Our daily roundup of retirement news your clients may be thinking about.

Why most seniors can’t afford to pay more for Medicare
A proposal aimed at replacing Medicare with vouchers would transfer the risk to seniors and could lead to higher costs for some of them, according to CNN Money. While the intent would be to bring down costs over the long-term by introducing more competition, it could also make traditional Medicare more expensive by siphoning off healthier seniors to private plans. Indeed, the Congressional Budget Office estimated that this could increase Medicare premiums 50% by 2020 compared with current projections. And such an increase in Medicare costs would be unaffordable for many seniors, according to the new interactive tool developed by the Henry J. Kaiser Family Foundation. Based on a simulation model from the Urban Institute, the tool analyses the population data, including income and demographics, and their long-range effects on retirement and aging.  --CNN Money

When is it OK to borrow from your 401(k)?
While 401(k) participants are allowed to borrow from their plans, clients should understand that the loans are not the same and will depend on the employer and the plan, according to CBS Moneywatch. Those who consider taking a 401(k) loan need to account for the interest, duration of the repayment, and the terms if they lose their jobs. This article discusses when it’s ok to borrow from a 401(k) plan, plus important details that clients need to know, such as what happens if they fail to fully pay their loans.  --CBS Moneywatch

Picking the best pension-payout plan
The Wall Street Journal features how a financial advisor helped a retiring client decide on the best pension payout while ensuring that she would leave something for her husband if she dies first. The expert advised the client to take a monthly benefit instead of a lump-sum payment and to select the option that would give her $4,500 a month for life without spousal benefit, which is costly. The advisor then told the client to use a portion of her monthly benefit to get a life insurance policy that will benefit her husband upon her death.  --Wall Street Journal

Paying long-term-care premiums with HSA money
Long-term-care policyholders can withdraw their money from their health savings account to pay the premiums tax-free if they hold a tax-qualified policy, according to Kiplinger. They can also pay Medicare Part B, Part D, and Advantage premiums using their HSA money. The tax-free HSA withdrawals aimed at paying long-term-care premiums vary according to age, and the amounts are raised to cover inflation.  --Kiplinger

How 1% can add $1 million to retirement
Clients can pursue an additional 1% return on their retirement investments to lead a comfortable life in their golden years, according to MarketWatch. The extra 1% return could lead to more than $5,000 in savings every year, increase the annual investments and rewards by 100%, and eventually add $1 million to the nest egg in 30 years. The article offers seven steps for retirement investors on how to increase their nest eggs based on the extra-1%-return principle.   --MarketWatch

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