Our daily roundup of retirement news your clients may be thinking about.
Dollar-cost averaging is not a good strategy for retirement investors to manage risk in their portfolio, according to CNNMoney. Such strategy leads to a series of asset allocations in investment portfolio that don't truly indicate the investors' risk tolerance. Investors are better off investing their money all at once in options to achieve their desired portfolio mix. –CNNMoney
A client is eligible to a Social Security survivors benefit on her spouse's record if the spouse dies before her and the benefit will be equivalent to the spouse's retirement benefit, according to this article on Yahoo Finance. The survivors benefit will be bigger than the spousal benefit the client is entitled to receive. While Social Security is expected to release the client's retirement benefits first, the actual benefit will be bigger if her spousal benefits will be larger than her own retirement benefit. –Yahoo Finance
Freight handlers and machine operators are more likely to retire early compared with other workers, according to a study by researchers at the University of Michigan. People who are working as purchasing managers, business and promotion agents and licensed practical nurses are also very likely to go on an early retirement, the study found. Social workers, postsecondary teachers, clergy, lawyers and judges are people who are likely to work longer and retire later than the others. –Money
People who have high-deductible health insurance coverage are entitled to a health savings account, which can be also a good vehicle for saving for retirement, according to CBS Moneywatch. HSA contributions can reduce their taxable income and will grow tax-free and withdrawals will not be subject to income tax if the money will be used for qualified medical expenses. As such, HSAs enable clients to save more on taxes compared with investing in a 401(k) plan or an IRA. –CBS Moneywatch
Clients are advised to simplify their investing, taxes and other basic management items to make their finances easier to manage in retirement, according to MarketWatch. For example, they may consider converting 401(k) assets to a Roth to lower their tax liability and make tax preparation simpler after retiring. Also, clients should avoid private real-estate partnerships, since these require complicated tax compliance and they will find these assets difficult to sell. –MarketWatch