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The best way to save for retirement may be to not think about it

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

The best way to save for retirement may be to not think about it
Balances in 401(k) and 403(b) accounts increased 6% from year-ago levels, with IRA balances rising nearly 7% from last year, according to this article on MarketWatch, citing an analysis by Fidelity. However, many clients are still concerned about their prospects in their golden years, compelling them to become more serious about retirement saving. “We are seeing a lot of positive impacts on plan design features that employers have adopted, things like automatic enrollment and automatic increases. They’re taking more proactive steps to increase the default deferral rates to encourage people who may be suffering from inertia,” says a researcher.

S&P 500 stocks strapped with the most net debt dropped 5% this year.
Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., on Friday, Sept. 30, 2016. U.S. stocks advanced as Deutsche Bank AG erased losses in German trading and European shares pared declines, easing concerns that turmoil in the banking industry could spread. Photographer: Michael Nagle/Bloomberg

Over half of millennials expect an inheritance—they may be disappointed
More than 50% of millennials are expecting an inheritance after their parents pass away, according to this article on CNBC, citing a survey by Charles Schwab. However, experts say that their parents are less likely to leave them an inheritance because their elders are expected to live longer and will need a bigger nest egg. "It's really important we all rely on ourselves and be really independent and build our own savings and nest egg so we can call our own shots," says an expert with Charles Schwab Foundation.

American workers' big disconnect about retirement
Sixty-two percent of Americans polled by the Transamerica Center for Retirement Studies voiced confidence that they could live comfortably in retirement, according to this article on CBS Moneywatch. However, this may not be possible, as workers' median retirement savings is estimated at $71,000, with only 30% amassing at least $250,000 in savings, states the TCRS report. Based on a 4% withdrawal rule, retirees can expect $2,840 in annual income if they have saved just $71,000, or $10,000 if they retire with $250,000 in savings.

How to eliminate several risks while generating more retirement income
Clients who seek to boost their retirement income are likely to take on duration, market, reinvestment and timing risks, writes an investment advisor on Kiplinger. To avoid these risks, clients have the option of buying an income annuity, which can provide at least 3% more in income, explains the expert. "The extra 3% or more above what you could earn in comparably rated bonds is very competitive in your favor … if you live beyond your life expectancy."

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