Clients must overcome inertia or resistance to change to successfully build their retirement funds, writes Ron Carson, CEO of Carson Group, in Forbes. They should also start saving early and even avoid advice from friends and loved ones if that advice isn’t directly linked to their specific needs and goals. As much as possible, clients should not allow their emotions to get in the way of decision making, especially when it comes to investing, Carson writes.
When clients reach the age of 59 1/2, there are specific moves they can make to boost their financial prospects, according to this Kiplinger article. For example, 401(k) withdrawals will no longer be penalized so they can use this as a safety net — as long as they remember withdrawn funds will still be subject to taxation. Clients can also make catch-up contributions to tax-deferred retirement accounts: Such a move will help boost their savings and reduce their taxable incomes.
Donating to charity directly from an IRA is one strategy clients can use to minimize the tax bite on retirement income, according to this Forbes article. There are additional benefits for retirees age 70 1/2 and older, as they can avoid taxes on required minimum distributions. Contributions to the fund are tax deductible for that tax year, but clients can wait to decide later where they donate the money. Capital gains on stock donated to these funds are also not taxed.
Based on the premise that clients should save about $1 million for a secure retirement, most Americans are far from a secure retirement, according to industry research cited in this CNBC article. More than one in seven respondents to the research’s study have not put aside anything for retirement, while just 10% said they have enough savings by the time they retire.
