Retirees today face a host of financial challenges that previous generations didn’t. The exit of guaranteed pensions from the private sector, coupled with increasing lifespans, has left many older Americans scrambling to make ends meet.
Not only that, there is often the need to start providing care for elderly parents or other relatives who have become unable to perform one or more of the activities of daily living (ADLs).
Paying to have this type of support professionally can be a financial burden for those who don’t have any insurance to cover them. But providing the care yourself can be equally burdensome in other respects.
Nationwide Retirement Institute conducted a comprehensive survey on caregiving and how it affects the lives of the caregivers. The survey researchers looked at those who were in the middle of their careers. These folks are commonly referred to Gen Xers or the sandwich generation.
The survey was designed to find out how they fared in retirement when also dealing with the challenge of caregiving for loved ones. Read More
When you think of the word “risk,” you may get a mental picture of such activities as skydiving, race car driving, rodeos, or other similar activities that have uncertain outcomes. For investments, the word “risk” may make you think of losing your life savings on a high-risk venture such as an oil and gas drilling partnership.
But the reality is that there are many different types of investment risk. All investments carry their own types of risk. It’s important to note that no investment exists without any type of risk. Read More
In the last decade, two major market crashes have occurred, causing many working professionals to worry about the long-term safety of their investments. While many have access to retirement saving plans like 401(k) plans, the limits on contributions, costly tax implications, and exposure to market risks make 401(k)s less appealing for conservative-minded savers.
Recently, “IUL,” or indexed universal life insurance, has emerged as an alternative to the 401(k). It’s important to note that IUL is not an investment strategy but a type of permanent life insurance. Be cautious of discussions that treat IUL as an investment vehicle, especially compared to a 401(k) plan.
IUL might appeal to retirement savers, including younger professionals, because of its tax-efficient advantages over the 401(k) and other benefits. These advantages include protection from market downturns, greater flexibility with contributions and accessing funds, and improved tax treatment of future income. However, the suitability of any financial product always depends on the individual client’s needs, circumstances, and objectives.
Here’s a brief overview of indexed universal life insurance and how it differs from a 401(k) as a wealth-accumulating option. Read More
Everyone faces challenges to some extent when moving into retirement. Even those with the best-laid plans can still have some financial hiccups. And with everything that has happened in recent years, millions of Americans are wondering what it all might mean for their financial futures.
Take, for example, a 2020 workplace wellness survey put out by the Employee Benefit Research Institute. In the study, 1,028 workers of ages 21-64 said that they worried about their finances and retirement savings.
Two-thirds of employees felt stressed when they thought about their financial future. Almost half were concerned with their household financial well-being, with saving for retirement and having funds for an emergency being the top stressors. Read More
Starting on January 1, 2021, Social Security beneficiaries will see a boost in their benefits. Over 70 million recipients of Social Security and Supplemental Security income will receive a COLA bump of 1.3% in their monthly payouts.
This increase is lower than the increase of 1.6% for 2020 by 0.3%. It’s also 0.1% lower than the average COLA of 1.4% that recipients have received over the last decade.
The average Social Security recipient will see a monthly bump-up of about $20 overall. In other words, that will be an increase from an average benefit of $1,523 in 2020 to $1,543 in 2021. Read More
If you are looking for a decent rate for your money, your local bank might not offer much to write home about. We already are in a low-interest rate environment, and the Fed doesn’t appear to be ready to raise rates anytime soon.
When you near retirement it’s an important life transition. Your approach to money matters will probably change. Now is time to examine portfolio assets and consider how you will use them for income to sustain your retirement lifestyle. A good retirement planning company can help you plan for this transition.
Retirement Planning Companies May Have Different Specialties
However, investors have many options of financial firms in today’s industry. Different firms can vary in the unique expertise to the table. Some companies specialize in investment management and others in financial planning, for example.
While similar in some ways to financial planning and investment management, retirement planning is different. It concerns advice on the distribution of money and how people will use the money for income needs.
Business Type Also Matters
There is also the question of business organization. Some firms are just one of many broker offices for huge financial companies, while other firms are small, local businesses. Whether they have a captive or an independent status may influence the kinds and selections of the retirement products they can offer you.
So, all of this adds up to many retirement planning options for investors. How do you choose the right partner for you? Let’s take a look at some questions to answer. Read More
Sequence risk is the risk that you will take a big loss early on in the life of an investment portfolio. It’s already bad when you have investment losses at the early start of your retirement. It’s equally bad when you take losses just before you retire.
But if you are retired and taking withdrawals when the portfolio losses happen, the impact of those losses is compounded. By taking a withdrawal, you are already drawing down the balance of money in your portfolio from what it was prior.
If your portfolio also sustains a loss at the same time, the effects of both will come together to affect you. You will not only have to eat the loss, but you will further deplete the balance in your portfolio. So the timing of your withdrawals matters, especially in relation to how your portfolio performs. Read More
Annuities can help strengthen your overall retirement strategy with their unique guarantees.
From lifetime income to growth or protection, their contractual guarantees can help in many areas. But just like with any other instrument, annuities also have risks of their own.
Annuities are becoming an increasingly popular retirement savings vehicle for people in the U.S. Many folks are seeking alternative instruments that can guarantee them a stream of income for life.
With corporate pensions gradually disappearing from the financial marketplace, annuities have emerged as a viable substitute for these bygone streams of income.
Most annuity contracts today come with a variety of benefits and features that were unheard of a generation ago. Living and death benefit riders, guaranteed income riders, and disability and long-term care riders are now commonly available in many annuity products.
However, in order to take advantage of many of these benefits, the annuitant will have to give the insurance company permission to annuitize their contract.
Annuitization is a one-time, irreversible event that ends the accumulation phase of the annuity, where money was being put into the contract or a lump sum of money was left to grow on its own. Annuitization marks the start of the payout phase of the annuity.
Start a Conversation About Your Retirement What-Ifs
Start a Conversation About Your Retirement What-Ifs
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What Independent Guidance Does for You
What Independent Guidance
Does for You
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Stories from Others
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