Our daily roundup of retirement news your clients may be thinking about.
How to handle the financial challenges of caring for aging parents
People who decide to have their retired parents live with them face big challenges, such as financial burdens and home adjustments to make the place safe for elderly, according to this article on MarketWatch. To address these challenges, clients may seek tax deductions designed for taxpayers in this situation, as well as assistance from the Medicaid Cash and Counseling program, which offers monetary help and other services to low-income seniors and disabled adults. A power of attorney can help clients in this situation, although this can be emotionally difficult to approach. In some cases, it can help to sit down with the parent and a third-party such as the parent's primary care physician who can intervene and explain why it makes sense to let the child take over the financial matters. --MarketWatch
3 habits that are killing your client's chances of retiring early
The ability to retire early usually depends on the financial habits that clients have developed over the years, according to this article on The Motley Fool. One expert cites the importance of discipline of saving aggressively and putting their spending under control, while another expert advises against buying a new vehicle when it's not needed because of fast depreciation costs. Another expert cautions that contributing to a taxable investing account is not a good idea for those who plan to retire early. --The Motley Fool
Opinion: Retirement income still being undercounted
While statistics from the Social Security Administration show that many Americans are becoming increasingly dependent on Social Security for retirement income, the figures are based on the term "income," which is defined by the Census Bureau's Current Population Survey as regular payments, such as monthly checks from Social Security and "defined benefit" pensions, according to this opinion piece from Forbes. This means that retirement income is undercounted, since the term does not include withdrawals from 401(k) plans and other irregular payments. --Forbes
Treasury nixes some lump-sum pension payouts
Companies will not be allowed to offer a lump-sum pension payout to retirees who have been receiving monthly pension payments under a new notice issued by the Treasury Department and the Internal Revenue Service, according to an article in The Wall Street Journal. The notice, which took effect July 9, will not apply to those who obtained permission from the IRS to offer lump-sum payouts. Retirees who agreed to get annuity payments may not be in the same sharp cognitive condition they were in when they decided to take the annuity, prompting the IRS to issue the notice, according to a Treasury official. --The Wall Street Journal
Advisors ease emotional hurdles of retirement
Financial advisors are studying the psychological aspects of retirement planning to better help their clients who are preparing for the golden years, according to this article on CNBC. Some pre-retirees have enough money, but they don't have enough interests or activities to make a new meaningful life, a certified financial planner says in this article. The article suggests the retired clients should collaborate with a life coach and read books to help discover what their retirement can look like. --CNBC
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