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Is your client setting up an HSA? They should be

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

Is your client setting up an HSA? They should be
Clients with high-deductible health insurance plans should consider setting up an HSA during this year’s open enrollment, according to this article in Money. An HSA is an underutilized savings and investment vehicle, but it can help people save for healthcare expenses in retirement. While HSA contributions are tax-deductible, savings grow tax-free and withdrawals are also not subject to taxes — as long as they are used for qualified medical expenses.

Are retired clients spending too much?
Seven in 10 senior clients are not aware of the 4% withdrawal rule, according to a poll cited by a Morningstar expert. About 16% of clients say that 6% to 8% would be a sustainable rate, according to the poll. "That's a problem. Because setting a sustainable withdrawal rate is such an important part of retirement planning," the expert says. "And at a bare minimum, anyone embarking on retirement should understand the basics of spending rates: how to calculate them, how to make sure their spending passes the sniff test of sustainability given their time horizon and asset allocation, and why it can be valuable to adjust spending rates over time."

5 finance conversations newly married clients need to have
Newly married clients need to work together as they find ways to handle expenses and plan for future goals, according to this Motley Fool article. They should discuss how to pay bills, how to cover emergency expenses and what insurance they need to have. They should also work on their long-term goals, decide on how they will achieve them, and plan and save for retirement together.

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November 6

How to help clients factor longevity risk into retirement planning
Clients in their 40s and 50s should consider the risk of longevity when creating a retirement plan, as they may live longer than anticipated, writes a Forbes contributor. "[A]s life expectancy continues to increase, the real number Gen Xers should focus on is the probability that they will live to a certain age. For a married couple who are both 50 years old today, the man has an 18% chance of making it to age 90. The female has a 30% chance. But the likelihood of either of them making it to age 90 is 42%,” the expert says.

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