Our daily roundup of retirement news your clients may be thinking about.
Having a written retirement policy statement to go with an investment policy statement can help near-retirees and retirees survive a market correction, according to this article by Morningstar's Christine Benz. The retirement policy statement serves as a blueprint for their plan and includes important details such asset allocation, withdrawal rate and Social Security start date, explains the expert. "Having these policy statements can really help insulate you from some of the market volatility that we've been experiencing recently."
Career trajectories for workers in their 50s can start to look less like a straight track and more like a roller coaster, according to this article from CNBC. Granted, the current job market is strong, but 56% of older workers experience at least one involuntary job loss after age 50, according to a new joint analysis from nonprofit newsroom ProPublica and Urban Institute, a think tank that focuses on economic and social policy research. Researchers focused on employer-related separations such as layoffs and business closings, with a special focus on cases that were "financially consequential" with either long periods of unemployment or sustained, substantial wage loss. They found that age discrimination makes it difficult for older workers to find jobs. Seniors who expect a late-career job loss are advised to continue building their job skills and take advantage of all training opportunities that their employer offers. They should also get on track with their retirement and other savings goals and rely less on future income.
Clients can ease their fears of the fumbling stock market by having a historical perspective on market returns and using strategies to protect their portfolio from market volatility, according to this article on CBS Marketwatch. For example, they should develop a Social Security claiming strategy that will maximize their retirement benefits and create guaranteed income sources, such as "bond ladders," low-cost payout annuities and reverse mortgage, to cover basic living expenses. They should then proceed to investing their remaining funds in stocks for considerable returns over time.
Retirement savers are advised to brace for a "bumpy ride" ahead because of multiple threat despite strong economic fundamentals, writes a financial planner on Fox Business. For example, the long bull market is poised to slow down after nearly a decade of robust performance, writes the expert. Investors approaching retirement are advised to shift to safer investments to minimize possible losses or convert traditional assets into a Roth at a time when lower tax brackets make the conversion a more attractive option.
