Welcome to Retirement Scan, our daily roundup of retirement news your clients may be talking about.
Clients should be aware that changes to Medicare, Social Security and other retirement plans will impact their savings and income next year, according to this article in MarketWatch. For example, workers can contribute $500 more to their 401(k), 403(b) and other similar plans. The average Social Security benefit will also increase by 1.6% as a result of inflationary adjustments, but Medicare standard monthly Part B premiums are on tap to rise by at least 6.7% next year.
Seniors need to rely on sound math to determine the amount of savings they will need to secure their retirements, according to this article in Kiplinger. To do this, they should determine their current actual spending, exclude expenses that will go away in retirement and figure out the cost of their preferred lifestyles. They should also factor in the cost of health care, taxes, inflation and changes in expenses over time. It is also important they have an emergency funds and back-up plans, as well as review their spending every year once they have retired.
Clients can boost their retirement savings by setting up an automatic transfer from their bank account to their IRAs, according to this article in Motley Fool. It will make it easier for them to add retirement savings to their budget. Experts say clients should be setting aside 10% to 15% of their income, and the amount should be more if they have not been saving consistently.
More than half of them track the industry’s top-performing category.
Whether or not clients are saving more than what they will need in retirement depends on their personal circumstances and the level of future financial security they desire, according to this article in CNBC. To strike a good balance between retirement savings and current needs, clients should ensure that their retirement plans are reasonable, account for what they need now and in the future and anticipate unforeseen expenses. It also pays for clients to have more retirement savings than what is necessary, as it allows them to feel more secure and even help others financially.
