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

Why clients shouldn’t use retirement savings to pay off debt
Employees with debts who transfer jobs and have the option to withdraw their retirement savings are likely to cash out these savings, according to a study by the Employee Benefit Research Institute. Retirement investors who are making such withdrawals are missing out on the growth of investments that he or she would have earned. Clients should be able to weigh how much it would cost to withdraw and pay down debt, versus keeping the funds in a retirement investment account, which could outpace the level of savings realized from paying down debt, according to EBRI.  --The Washington Post

8 solutions when retirement savings that are too low
Staying employed for a longer period of time and delaying the start of one's Social Security are two of the most effective ways to augment a low savings rate for retirement investors, according to MarketWatch. Other crucial options are to pay off debt before retiring, downsizing the house, or moving to a less expensive retirement community, including foreign locations. A reverse mortgage is also an option, but should only be considered a last resort because of its high costs.  --MarketWatch

A Low-Cost Investment Option for Some 401(k) Savers
Collective investment trusts may present a viable low-cost option as part of 401(k) plans, as it can be adjusted according to a plan's needs, especially for institutional investors in retirement and pension plans, according to Morningstar. However, CITs are not covered by SEC regulations, and as a result, lacks the transparency required from conventional mutual funds. For investors, weighing CITs should involve checking whether a qualified manager is overseeing the account and ensuring that the plans include complete and proper documentation.--Morningstar

Should you pay off your mortgage when retiring?
People can pay off their mortgage in retirement through prepayment or by giving 50% of the monthly mortgage payment every two weeks, according to USA Today. Most baby boomers who responded to a Demand Institute survey still owe money on their houses and many of those who plan to move plan to upsize or take out another mortgage. Carrying mortgages until retirement is dependent on the person’s financial situation, an expert said.  --USA Today

Recent rout makes high-yield bonds intriguing
Traditional fixed-income funds are not yielding much gain for retirees, but yields from high-yield, or junk, bonds have increased recently, according to MarketWatch. High-yield bonds are rated lower than investment-grade and carry more risk than those safer investments. As the U.S. is still in the process of economic recovery, investors should seek professional advice before putting their money in high-yield bonds, but those wanting to enter the market with lower volatility risk may consider low-cost ETFs.  --MarketWatch

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