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Has your client’s retirement mindset shifted?

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

Has your client's retirement mindset shifted?
Today’s seniors are embracing new retirement philosophies, writes an expert on Fox Business. “The retirees I worked with 15 years ago were determined to be debt-free, live on the interest and appreciation of their investments while never spending their principal, and hand down their hard-earned wealth to their loving children,” the expert writes. “Today, many of my clients are buying BMWs and traveling to adventurous places in Europe ... This enthusiasm for life is quite exciting, but their high cost of living without an income from work does present challenges.”

December 9-12, 2019, Fontainebleau Miami Beach, Miami | A neutral zone of sorts allowing the profession’s leadership to convene and join in the conversation, engaging dialogue and civilized debate, all with the objective of elevating the role of the independent investment advisor.
December 5-6, 2019 | San Francisco, CA The digital transformation of the wealth management industry is happening quickly. The industry’s largest players are swiftly adapting to meet ever-increasing customer expectations, and the rest of the field striving to keep pace. Behind the scenes, many firms are increasing technology investments and increasing headcount in an effort to drive growth, but margins remain under pressure. In|Vest West will explore all the dynamics at play—from front to back office—and the technologies that are shaping the future of the firm.
CEO, 280 CapMarkets
8h ago

old couple travel retirement age 4/9/19
A couple stands on an embankment in Ishigaki, Okinawa Prefecture, Japan, on Saturday, June 20, 2015. The Abe administration aims to cap increases in spending as it tries to rein in the world's heaviest debt load while sustaining a recovery from two decades of stagnation. Photographer: Akio Kon/Bloomberg

Tax-efficient bucket portfolios for minimalist retirees
A minimalist portfolio consisting of index funds may be cheap, easy to maintain and well-diversified, but it may not be as tax-efficient as expected, especially for wealthy retirees who face higher tax rates, writes an expert on Morningstar. Holding these assets in taxable accounts will generate income distributions that are subject to ordinary income tax rates, and affluent retirees can also see a spike in their tax bill once they start taking required minimum distributions from tax-deferred accounts at age 70 1/2, the expert writes. “[M]anaging taxable assets for maximum tax efficiency is a way to reduce the drag of taxes on that portion of the portfolio, at least.”

The average expense ratio among the top-performers is 40 basis points higher than the average.
April 9

Are big 401(k) contributions easier for empty nesters?
Clients will be in a better position to boost contributions to their 401(k)s once their children leave home, according to this article on Bloomberg. It would mean a reduction in expenses, allowing them to have better cash flow and save more money in the process. "The lift comes from disposable dollars. It’s a material amount of money,” says an expert.

How to supercharge your client’s retirement savings
Downsizing a home is one option for clients looking to improve their financial prospects in retirement, according to this article on Motley Fool. By downsizing to a smaller home, clients can reduce their housing and utility costs. Moving to a cheaper neighborhood could mean a lower property tax burden. Downsizing is not meant for all retirees, so it is important to weigh all options and make a budget projection before making a decision.

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