Category: Financial and taxes in retirement
March 29, 2011 -- One of the persistent myths about retirement is that it doesn't pay to work after you start collecting social security. The thinking goes is that because if you start collecting before your full retirement age your benefits are reduced, and because you will be taxed on a portion of your benefits if your overall earnings pass a certain threshold, you will be worse off for working.
A very helpful article from WSJ MarketWatch Editor Robert Powell, "Taxing Problem: How to Keep Working and Collecting Social Security", clearly explains why this thinking is off base. As Michael Kitces, editor and publisher of The Kitces Report says in the article “... frankly, I’ve never seen a situation where there was actually a net loss for working." He goes on to say that by working you bring additional dollars into the household. Uncle Sam gets to keep part of that, and you get to keep part. Everybody is ahead vs. ....
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Published on March 29, 2011
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Category: Financial and taxes in retirement
March 22, 2011 -- You are about to retire, but perhaps you didn't quite pay off the mortgage on your home before you got your gold watch (remember those days!). That might put you in a quandary - you have the money in your retirement account that could pay it off, and you know that CDs and T-bills are not going produce anywhere near the interest rate you are paying to the bank - even if you did refinance recently. And in addition, your income has dropped so that home mortgage deduction doesn't have the same effect as in your higher income days. So what to do?.....
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Published on March 22, 2011
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Category: Financial and taxes in retirement
March 7, 2011 -- Earlier this week we received this comment from a member: "I'm planning on retiring in 6 months and my wife is getting worried about having enough money in retirement. I have a good retirement plan, our home is paid off, and we are debt free. My wife also has retirement income. Any ideas on calming some of her fears?"
This question seems so pertinent to what so many baby boomers are going through right now. We can speak from experience here; the shock that comes from retiring and realizing that we are not going to be getting a paycheck anymore is very real. We can't count on raises or a promotion to fund an ever-expanding lifestyle. Saving money
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Published on March 7, 2011
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Category: Financial and taxes in retirement
Although it is true that most baby boomers feel poorly prepared for retirement on a financial basis, millions of them are very well heeled. Bank of America released its latest Merrill Lynch Affluent Insights Quarterly in January, which was based on a survey examining the values, financial priorities and concerns of affluent Americans. The survey found that the vast majority (84 percent) of affluent baby boomers (in this survey, boomers aged 46 - 64 who had investment assets of $250,000 or more) believe that their "retirement" will differ from that of their parents. These baby boomers see those differences as positive - 86 percent intend to live a more active lifestyle, and 72 percent believe they will enjoy a higher
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Published on February 8, 2011
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Category: Financial and taxes in retirement
The inadequate consolation of losing our parents is that our loss is usually associated with the prospect of receiving an inheritance. As baby boomers age and their parents start to reach old age, the inevitability of that happening grows ever more imminent. In 2007, 58% of baby boomers had at least 1 living parent.
The Center for Retirement Research of Boston College completed an intriguing research project not too long ago - "How Important Are Inheritances for Baby Boomers". In the study a panel of subjects born before 1954 were asked about the probability of and how much they might expect for an inheritance in the next 10 years. The results of the survey indicate that about two-thirds of baby boomers expect to receive an inheritance of some amount. Obviously, the wealthiest
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Published on February 1, 2011
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Category: Financial and taxes in retirement
Note - October, 2016 -- This article still has a lot of good information in it, but some is outdated, particularly as it pertains to spousal benefit strategies like "File and Suspend" and "Restricted Benefit". See "Filing for Social Security: 5 Reasons Why It Is More Complicated Than You Think" for more up to date information.
January 25, 2010 -- If your quick response to this question was 62, you might want to think a little harder. More and more information is coming out that supports the idea that you should wait as long as possible, particularly if you or your spouse had a high earning career. If you responded that you weren't sure, that was a good answer, because the question is a surprisingly complex one and highly personal too. This article will review some of the key considerations you need to take into account before reaching your decision. Note: See our 2011 article, "10 Things You Need to Know Before You Start Taking Social Security".
First, to recap: For people born between 1943 and 1954, your full retirement age is 66 (for people born earlier it is few months younger; or older if you were born in a later year). If you were in born in 1946 and elect
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Published on January 24, 2011
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Category: Financial and taxes in retirement
The Presidential blue ribbon panel on how to reduce the deficit revealed a draft of its plan earlier this month. We don’t know about you, but any time a proposal attracts both howls from the rabid right and screams from the liberal left, it has to be a pretty good thing. The draft report prompted us to write this article on how its draft proposals might affect you as an older baby boomer (born before 1956). It also includes information about how you can interactively fix the budget yourself - courtesy of the New York Times.
Here are some of the key aspects of the proposal from the commission co-chaired by Erskine B. Bowles and Alan K. Simpson.
In our opinion most of the
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Published on November 23, 2010
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Category: Financial and taxes in retirement
October 30, 2010 -- Americans might be justified in being envious of the French, who are taking to the streets to protest the raising of their retirement age from 60 to 62. Here in the states, the Sun Life Unretirement(SM) Index indicates that just as many Americans expect to retire at 70 as do 65. More than half more the working Americans responding to Sun Life's recent survey (52%) expect to work at least three years longer than originally planned. Whereas in previous years the reason for working longer was "to stay mentally engaged", "to earn enough money to live well" is cited just as frequently now.
Confidence continues to fall
At Topretirements we continue to see a steady stream of financial concerns relating to
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Published on October 30, 2010
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Category: Financial and taxes in retirement
The answer to this million-dollar question is—it depends. For many, financial decisions often hinge on alternative investments or innovative ways to grow wealth. Recently, we explored options like the beste bitcoin casino Nederland, a platform increasingly recognized for its potential to combine entertainment with financial gains through cryptocurrency gaming. Considering that the average baby boomer has only socked away about $50,000, it might be a bit of an academic question. Nevertheless, these emerging opportunities can spark curiosity and offer intriguing solutions for the future.
If you take the usually noted figure of 4% a year that can be safely taken out of the $1 million, you get $40,000 per year. No matter how much you have saved, experts agree that a 4% withdrawal rate will let you take money out for 30 years with only a slight danger of running out of money. If you get a pension or social security you could add that income on top of the $40,000 (the average SS payment to
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Published on October 18, 2010
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Category: Financial and taxes in retirement
You don't have to look hard to find either great optimism and depressing pessimism about the retirement prospects of American baby boomers. For example you could read "Find a Retirement Career" from Fidelity and feel pretty good. Or, you could spend some time with these articles from the Wall Street, "Another Threat to the Economy:Boomers Cutting Back" or USA Today, "Boomers Wanting to Work Past Retirement Age Find Limited Options", and get very depressed.
All of these articles have their strong points
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Published on September 29, 2010
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