Our daily roundup of retirement news your clients may be thinking about.
Today’s seniors are embracing new retirement philosophies, writes an expert on Fox Business. “The retirees I worked with 15 years ago were determined to be debt-free, live on the interest and appreciation of their investments while never spending their principal, and hand down their hard-earned wealth to their loving children,” the expert writes. “Today, many of my clients are buying BMWs and traveling to adventurous places in Europe ... This enthusiasm for life is quite exciting, but their high cost of living without an income from work does present challenges.”
The groups managing hundreds of millions are coming over from Merrill, Northwestern Mutual and Wells Fargo.
Matheus Riolfi is the co-founder and CEO of Tint. Before this, he was the Director of International Expansion at Turo and launched the company in Canada, the UK, and Germany. He pioneered operations, including designing risk management in different company stages and sourcing insurance in various countries. He is a licensed insurance broker in all 50 US states, holds an MBA from Harvard Business School and a dual degree in business from the University of São Paulo and Kedge Business School.
Sammy is the founder and CEO of YuLife, a tech-driven insurance company on a mission to inspire life by providing group insurance, wellbeing, and rewards in one simple app. He originally built Policy Portfolio plc, the first market maker in traded endowments and led the flotation of the company on the full London Stock Exchange. He then went on to become the founding CEO of PruProtect (now VitalityLife), which was the first life insurance company in the UK to reward healthy living. Sammy holds a degree in computer science from Imperial College London.
A minimalist portfolio consisting of index funds may be cheap, easy to maintain and well-diversified, but it may not be as tax-efficient as expected, especially for wealthy retirees who face higher tax rates, writes an expert on Morningstar. Holding these assets in taxable accounts will generate income distributions that are subject to ordinary income tax rates, and affluent retirees can also see a spike in their tax bill once they start taking required minimum distributions from tax-deferred accounts at age 70 1/2, the expert writes. “[M]anaging taxable assets for maximum tax efficiency is a way to reduce the drag of taxes on that portion of the portfolio, at least.”
The average expense ratio among the top-performers is 40 basis points higher than the average.
Clients will be in a better position to boost contributions to their 401(k)s once their children leave home, according to this article on Bloomberg. It would mean a reduction in expenses, allowing them to have better cash flow and save more money in the process. "The lift comes from disposable dollars. It’s a material amount of money,” says an expert.
Downsizing a home is one option for clients looking to improve their financial prospects in retirement, according to this article on Motley Fool. By downsizing to a smaller home, clients can reduce their housing and utility costs. Moving to a cheaper neighborhood could mean a lower property tax burden. Downsizing is not meant for all retirees, so it is important to weigh all options and make a budget projection before making a decision.
