Our daily roundup of retirement news your clients may be thinking about.
Signing up late for Medicare Part B can trigger a lifelong penalty
Seniors are advised to do research on Medicare because missing the deadline for enrollment in the program could mean a lifelong penalty, in some cases, of 10% of Medicare Part B premium for every year they have not enrolled, according to this article on Los Angeles Times. The seven-month enrollment kicks in three months before they turn 65 and extends through three months after their birth month. Those who have filed for retirement benefits at 65 are automatically enrolled for an insurance package that covers both Medicare Part A and Part B, but those who have deferred their benefits have to enroll themselves into the program. --Los Angeles Times
How to avoid outliving your retirement savings
For many financial advisors, a 4% withdrawal rule is recommended to ensure retirees will not outlive their retirement savings, but recently some analysts doubt if such a strategy will work, according to this article on CNNMoney. Clients are advised to monitor their situations and remain flexible. They should tap their retirement savings at a reasonable rate and make adjustments as they move on. A reasonable rate is between 3% and 4%, and this may go higher or lower depending on the other sources of retirement income they have. --CNNMoney
Retirement investing: Combining correlation and compromise
Diversifying an investment portfolio based on "the principle of correlation combined with the complementary principle of compromise" is a way to ensure that retirees' nest egg will be enough to support them through the golden years, according to author Chris Minnucci. Such an approach means building a portfolio that consists of some high-volatility investments, investments that behave along with stocks of large-cap companies and some low-correlation investments, and bonds to offset the stocks' volatility, Minnucci says. "Risk and stock volatility are not the same thing at all." --MarketWatch
Medicare-provider penalties, incentives detailed in report
Nearly 40% of health-care providers who treat Medicare beneficiaries--more than 460,000 doctors--failed to report patients' health information to the authorities in 2013. In turn, that prompted the government to slash 1.5% from the payments this year, according to a report to from the Centers for Medicare and Medicaid Services. Some 70% of providers that opted not to participate treat fewer than 100 Medicare beneficiaries annually, with nearly 642,000 providers expected to earn a .5% boost in payments after complying with the requirement, the agency said. "These are not measures of physician qualitythey're more a reflection of the staff's ability to code effectively," said Anders Gilberg of the Medical Group Management Association. --The Wall Street Journal
Is your 401(k) on track for a secure retirement?
While retirement confidence has increased based on a new research, workers need to make sure that their 401(k) plans are on track to secure their retirement, according to this article on CNBC. They need to opt to take automatic contributions but make their own choices when it comes to diversification, fees and taxation, such as picking low-cost investments, an expert says. "Probably the most important thing is picking appropriate investments," says A. Raymond Benton of Lincoln Financial Advisors. --CNBC
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