Our daily roundup of retirement news your clients may be thinking about.
Entrepreneurs who are operating abroad need to comply with tax reporting obligations and to take advantage of qualified retirement accounts for their business, writes David Kuenzi, founder of U.S.-based Thun Financial Advisors. Those who have a controlling stake in a controlled foreign corporation will face very complicated tax reporting requirements and be required to file Form 5471 every year regardless of their business's financial status, Kuenzi says. "Even if no tax is due, failure to file a Form 5471 can result in large penalties." The Wall Street Journal
Although Social Security faces insolvency problem in the coming years and there is an urgency to fix the problem, lawmakers are very unlikely to arrive at a sweeping reform to address the situation, according to this article on The Motley Fool. When the program has to reduce benefits in the early 2030s, lawmakers will be more inclined to opt for deficit spending to secure table benefit payments. Regardless of what happens, workers need to boost their savings rate so they will be financially secure even if there will be cuts to their Social Security benefits. The Motley Fool
The number of investments that investors should have in their portfolio depends on a number of factors, such as the type of account, the size of funds and the period of time that they can commit, according to this article on Forbes. Investors that start out with $10,000 or less may begin with one asset allocation. These investors can develop the habit of saving while having access to major asset classes, such as large-cap, small-cap and bonds. Forbes
As part of the so-called sandwich generation, many workers in their 50s are in a very tough situation as they are obliged to provide support to their parents and adult children, according to this article from Consumer Reports. They may also expect to see their term life insurance lapse and their medical expenses soar. Read the tips on how these people can handle these issues and improve their retirement prospects. Yahoo Finance
Buying an insurance to have retirement security is a good move if clients feel a financial disaster is likely in the future, according to this article on CBS Moneywatch. An insurance coverage is a good choice if it provides a source of income until clients die, even when the stock market declines or inflation drives up living costs, and they get automatic payments. Social Security, employer-provided pensions and annuities are only the sources of retirement income that meet these requirements. CBS Moneywatch