Our daily roundup of retirement news your clients may be thinking about.

Retirement literacy shockingly low: survey
Many Americans fared poorly in a retirement literacy survey conducted by the American College of Financial Services, according to this article from the Chicago Tribune. Only 38% of the participants were aware that the maximum sustainable withdrawal rate is 4% for a nest egg worth $100,000, while only 34% of the respondents knew the impact of negative return on assets is greater at retirement age than either before or after retirement. The survey also found that participants had average understanding about IRAs, with many participants not knowing a sufficient amount of Social Security benefits.

Do clients need to pay off mortgage before they retire?
Lower-income families stand to gain more from paying off their home mortgage before retirement compared with wealthy households, according to this article on MarketWatch. Families with more than $1 million invested assets should treat debt the way companies do and use it to limit their risk exposure. "You are a lot better off if you can bring more money to the table through the strategic use of debt and then target a lower, less-volatile return," says an expert.

Beware the impact on RMDs when reversing a Roth IRA conversion
Undoing a Roth conversion could have an impact on a 73-year-old retiree's required minimum distribution from his traditional IRA for this year, according to this article on Kiplinger. Converting the IRA assets to a Roth would be excluded from RMD calculation for 2017, but re-characterizing it and getting back the money paid for taxes on the converted amount would mean an increase in the RMD amount and the subsequent tax. “If all or a portion of the conversion is reversed, an adjustment to the December 31, 2016, balance needs to be made, thus increasing the 2017 RMD,” says a retirement strategist.

How setting up an online Social Security account fights ID theft
Clients are advised to create an online account on Social Security website to gain access to personal records, including their future retirement benefits, according to this article on CBS Moneywatch. Having a ‘my Social Security account’ online could also help deter identity-related theft, as only one account can be created per Social Security number.

Retirement takes more than curb appeal
Pre-retirees are advised to seek help from a retirement professional to ensure a smooth transition into the golden years, writes a Forbes contributor. "It’s time to recognize the role that retirement coaching can play in helping people remodel their identity, re-wire their relationships with family, friends, and neighbors, and move their health and well-being to the top of the honey-do list," writes the expert.

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