Our daily roundup of retirement news your clients may be thinking about.
Lessons clients can learn from their parents’ retirement
Young people can learn valuable insights from their parents' retirement, such as the importance of a strategic plan and the advantage of saving early in their careers, according to this article in Money. Their parents' retirement also can teach them the value of building multiple sources of retirement income, reduce their investment costs, downsize if possible, and automate their retirement plan contributions and increases. Their parents, as a group, delayed any gratification and made early sacrifices, as well as managed their debt wisely to secure their retirement. --Money
How clients can save money by automating their portfolios
Clients need to avoid making emotional decisions to succeed in retirement saving and investing, and one way to do this is by automating certain aspects of their finances, according to MarketWatch. For example, they may opt for automatic transfer of their salary to their savings accounts or retirement plans, and diversify their portfolio automatically by investing in index funds. They can also rebalance their portfolio annually and follow their financial adviser's recommendations and set automatic monthly transfers to their checking accounts for their estimated expenses per month. --MarketWatch
Social Security FAQ: Spousal benefits
Under the Bipartisan Budget Act of 2015, only clients born before Jan. 2, 1954, and reached their full retirement age have the option to delay their own retirement benefit and file for a spousal benefit, according to Morningstar. Such an option will no longer be available to those who were born after that date. They also will be applying for their own retirement and spousal benefits if they are no longer entitled to make a restricted claim of benefits under the new law. -- Morningstar
13 funds to consider for retired clients
Retirees who have to convert their retirement savings into an income stream will need to make some changes to their investment portfolio but not necessarily a radical restructuring, according to Kiplinger. They need to realize that they cannot make their portfolio generate the needed income with just one investment type, but with a well-balanced, diversified menu of asset types. Know the mutual funds and exchange-traded funds that experts recommend for retiree investors to include in their portfolio.--Kiplinger
The new math on reverse mortgages
For financial advisors, recent policy changes providing increased protection for homeowners who get a reverse mortgage have made such an option a more helpful tool in retirement planning, according to MarketWatch. “Over time, these changes may encourage larger banks to re-enter the market, further increasing the credibility of the product and potentially lowering costs,” says an expert. --MarketWatch
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