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How to make it, spend it, and invest it

3 Jun 2019

3 ways to boost clients’ retirement savings without upping their contributions by Amanda Schiavo

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Welcome to Retirement Scan, our daily roundup of retirement news your clients may be talking about.

3 ways to boost clients’ retirement savings without upping their contributions
Clients who want to turbocharge their retirement savings without raising their contributions should find ways to reduce their investment fees, according to Motley Fool. They should also start contributing early to traditional 401(k)s and IRAs, as the contributions can help reduce their taxable income. Making regular contributions is also another strategy, but they should ensure that their contributions don’t exceed the limits to avoid a penalty tax.

Ignoring this client asset may become an advisor’s nightmare
Financial advisors should tell their clients with permanent life insurance to invest their cash-value in the stock market through a sub-account, according to CNBC. The invested assets will grow on a tax-deferred basis and policy holders can apply for a loan to generate tax-free money in retirement. Having tax-free income in retirement affords retirees greater flexibility to manage their taxable income and minimize their tax bill.

What does the House retirement bill mean for your clients?
The House passed bipartisan legislation that would change the rules for 401(k) plans and IRAs to enable more workers to save for retirement, according to The Wall Street Journal. President Donald Trump is expected to sign the bill once it clears the Senate. Under the bill, retirement savers would be allowed to use their 401(k) funds to buy an annuity while long-tenured part-time workers would have access to their employer-sponsored plans. The bill would also scrap the age cap for traditional IRA contributions and allow retirees would start taking required minimum distributions at the age of 72.

Forget retirement — focus on financial independence
Although personal finance experts are split on “Financial Independence, Retire Early” or FIRE movement, it is changing the conversations about retirement, according to MarketWatch. “There are corporate executives who have come into my office paying a mortgage, have kids in private school, and they’re exhausted in their 60s and want to retire,” says an expert. “There have been a few times when it just wasn’t feasible, and they hadn’t thought about it their whole life. If FIRE can bring awareness to that earlier on, I’m all for it.”

Amanda Schiavo

Amanda Schiavo is an associate editor of Employee Benefit News and Employee Benefit Adviser. Follow her on Twitter at @SchiavoAmanda. https://www.financial-planning.com/news/ways-to-boost-clients-retirement-savings-without-upping-their-contributions

This article is suggested reading by Secured Financial Services, LLC and President and Chief Executive Officer of Secured Financial Solutions, LLC, Anil Vazirani. Please visit https://secured-financial-solutions.com/

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