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10 ways retirement has changed over the past decade

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

10 ways retirement has changed over the past decade
Things have changed considerably over the past 10 years. Clients may need to change the way they view and plan for retirement, according to this article from Yahoo Finance. For example, today's retirees are expected to live longer, meaning they will need to plan for a longer retirement. Since pensions are gradually disappearing, more retirees will have to rely on 401(k)s. They can also expect higher healthcare expenses. Additionally, clients can no longer rely on the 4% rule to develop a sustainable withdrawal strategy.

Roth IRA as the perfect post-college starter account
Workers are advised to consider using a Roth IRA to save for future education costs, writes an expert in Forbes. These accounts are funded with after-tax dollars, meaning that clients can withdraw money any time without owing taxes and penalties. "Since [they] are limited in how much [they] can add to a Roth each year, funding the Roth early can make a large difference later in life,” he explains.

What women should consider when claiming Social Security
There are a few considerations that women need to make before deciding when to start collecting their Social Security benefits, according to this MarketWatch article. Those who are still working may expect Social Security to withhold a portion or all of the benefits if their wage income exceeds the earnings limit. Women also need to determine what their Medicare premiums are, as Social Security is expected to deduct the amount from their benefit payments. A certain portion of their retirement benefits will also be subject to taxation if their combined income exceeds a certain threshold.

These insiders are well placed to propel their firms forward and encourage colleagues to address the industry’s shortcomings.
December 19

Clients can spend their retirement savings without triggering a tax penalty
Seniors have to start taking required minimum distributions from their tax-deferred retirement accounts the year they turn 70, which will trigger a tax bill, according to this article from CNBC. Those who fail to take the distributions on time will face a tax penalty equivalent to 50% of the RMD amount. To avoid this, retirees are advised to take advantage of the distribution schedule that their IRA administrator offers. “It’s much easier to factor these RMDs into your income that way, and you’re not scrambling to meet the deadline — or risking forgetting,” says Arielle O’Shea, a retirement expert at NerdWallet.

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