The federal government can raise the contribution limit to IRA and other retirement plans to help people boost their retirement savings, writes Michelle Perry Higgins, a financial planner and principal at California Financial Advisors. The maximum contribution amount remains very low despite gradual increases over the years, Higgins says. "Increasing the amount that could be contributed would be an added incentive to many people such as workers whose employers do not have a retirement plan or to non-working spouses who may be eligible for a spousal IRA." The Wall Street Journal
The $500 increase in the 401(k) contribution limit for 401(k) plans this year may be small but can help workers boost their retirement savings because of compounding, according to an article on The Motley Fool. For example, a 22-year-old worker could expect $263,000 more in his nest egg when he retires at 66 if he adds $500 to his annual retirement savings. They can also make after-tax contributions to their 401(k) plans and convert them to a Roth IRA so they can withdraw the money tax-free after they reach 59 1/2. The Motley Fool
The decision by a client to name his daughter as beneficiary of a Roth IRA intended for his grandson's college education is a good decision if he wants her to have full control of the account in case he dies, according to this article on MarketWatch. However, he may consider establishing a trust or other arrangement to ensure the assets will go to his grandson's college expenses. Another option is to consult with an adviser about a 529 savings and prepaid tuition plans, which don't require RMDs unlike a Roth IRA. MarketWatch
Seniors still have the opportunity of pursuing a second career to hone their creative talents after leaving their work, writes Chris Farrell, senior economics contributor for American Public Medias Marketplace. Many famous artists reached their peak when they were in their advance years, Farrell writes. To keep their creativity, they are advised to mingle with people of different ages and from different backgrounds, be open to doing something new, and develop new skills. Time Money
A 64-year-old client who is entitled to a mother's benefit, widow's benefit, and her own retirement benefit may maximize her benefits if she takes her reduced retirement benefit now and her widow's benefit when she turns 66. She may also start collecting her widows benefit before 66 and then shift to her own retirement benefit when she reaches 70. She may get all possible claiming strategies to maximize her benefits using commercial software. Forbes
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