Our daily roundup of retirement news your clients may be thinking about.
Retirees in roughly two dozen states, including California and Texas, are able to take advantage of a property tax deferral programs, according to this article for Money. These are available to older homeowners who want to put off paying real estate taxes provided they remain living in their home. Homeowners who have mortgages usually need approval from their lenders, the article says. When program participants eventually sell or pass away, the state claims the balance of what they owe, plus interest, from their home equity.
Clients should consider real-estate investment trusts in their portfolio to offset the impact of inflation, according to this article from Kiplinger. REITs enable investors to achieve diversification. These trusts also provide generous dividends as they are required to distribute at least 90% of their taxable income to their shareholders. Hefty dividend income, plus appreciation of stock prices, will enable investors to cope with price increases.
A ruling issued by the IRS would enables companies to help their workers repay student loan debt using their 401(k) plans, writes Alicia H. Munnell, director of Boston College Center for Retirement Research on MarketWatch. Based on the ruling, employers under certain circumstances can link their 401(k) matching contributions to their employees' student loan repayments made outside of the plan, explains the expert. "This is a small positive step toward improving retirement saving. I always worry, however, that without automatic enrollment, too few employees will take advantage of such an option when offered."
A study by Northwestern Mutual has found that 78% of Americans claimed that they are "extremely" or "somewhat" worried about not saving enough for retirement, according to this article on CNBC. The study also found that 21% have not saved anything, with 10% having a retirement balance of below $5,000. Americans who have saved for retirement hold an average of $84,821, an amount, which many experts say, is not enough to secure retirement.
