Welcome to Retirement Scan, our daily roundup of retirement news your clients may be talking about.
Assets in 401(k) plans currently amount to $5.7 trillion, representing 20% of the total retirement savings in the U.S., according to an ICI survey in this article from CNBC. Although 401(k) plans are widely used, more than one-third of American workers think that they pay no 401(k) fees, the survey found. Findings from a separate analysis show 401(k) participants pay an average of 0.45% in overall costs, the article says.
A revocable trust can be a great tool for estate planning, as it offers clients many advantages, according to an article in Kiplinger. A revocable trust allows clients to skip the probate court process, avoid conservatorship, gain greater flexibility and ensure privacy. However, this type of trust does not offer any tax benefits, and clients should plan carefully if they opt to place their retirement accounts into a trust.
-
Errors are regrettably common. They are also easily avoidable.
April 1 -
Military families can use one of these provisions to seriously cut their tax burden. Plus, can clients make an IRA contribution on behalf of a deceased person?
October 23 -
Financial planners don’t have to be attorneys to help clients avoid high cost oversights
December 24
Clients should not believe every retirement tip they get, as not all advice can help boost their prospects, according to an article in The Washington Post. For example, it is not advisable for seniors to carry a mortgage into retirement. Clients will also be better off saving both for their child’s education and their retirement than saving for only one of the two, according to the article. Filing for Social Security early is not always a poor financial move.
Fees were nearly half the price of the top-performing active funds.
Passive savers are more inclined to depend on auto-enrollment and focus on gratification in the short term, compared with their active counterparts, according to a study found in this article from MarketWatch. Active savers are also more likely to save more than the default contribution rate, the study found. “[O]ur findings suggest that developing ways to mitigate present bias and improve financial literacy may change saving outcomes and ultimately improve welfare,” researchers say.
