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3 Essential RMD Tips Every Boomer Needs to Know

Unknown individual retirement accounts, money management, personal finance retirement, retirement, retirement planning

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<div class="keypoints-box">
 <h3 class="keypoints-header">
 Key Points
 </h3>
 <ul class="keypoints-list">
 <li class="keypoints-item">
 
 Retirement account distributions can pose challenges for older individuals unprepared to start using their saved funds.
 
 </li>
 <li class="keypoints-item">
 
 Some tax-favored retirement plans do not require minimum distributions.
 
 </li>
 <li class="keypoints-item">
 
 Your distribution won't lead to a tax bill if you plan it carefully.
 
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 <li class="keypoints-item">
 
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 Setting aside funds for retirement through an IRA or 401(k) might lead to significant tax benefits. You not only avoid taxation on this portion of your earnings now but also benefit from tax-free growth within these accounts. Taxes will be due solely upon withdrawing money from your savings later in life.


 However, there’s a drawback to setting aside funds for retirement in an IRA or 401(k). At some point, you will be obligated to begin withdrawing money from your account through what are known as required minimum distributions (RMDs).


 For certain individuals, Required Minimum Distributions (RMDs) pose no challenge. Suppose you must withdraw $12,000 annually from your IRA according to your account value and projected lifespan, yet this sum was already intended to meet your living expenses; thus, there’s no concern involved.


 However, for older individuals who do not require those funds, Required Minimum Distributions (RMDs) can be troublesome. They might not only lead to an unexpected tax liability but also reduce the amount of money available to accumulate in a way that offers tax advantages.


 Nevertheless, with adequate financial planning, Required Minimum Distributions (RMDs) can cease to be an issue. If you're feeling anxious about taking RMDs upon retiring, here are three key points you ought to understand regarding these distributions.

<img data-document-id="cms/api/amp/image/AA1Cc2mC" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1Cc2mC.jpg"/>
<h2>
 1. These rules do not pertain to Roth 401(k)s anymore.
</h2>

 In the past, Roth IRAs were the sole tax-favored retirement plans allowing seniors to avoid required minimum distributions (RMDs). However, it’s important to recognize that Roth 401(k)s also no longer enforce these RMD requirements.


 This is beneficial since Roth IRAs come with income restrictions, whereas Roth 401(k)s do not. Therefore, if your earnings exceed the limit for a Roth IRA yet your employer offers a retirement plan with a Roth option, you’re still able to proceed.


 Of course, if you
 do
 make more than the limit for a Roth IRA, then you might consider
 backdoor option
 To investigate. However, a Roth 401(k) might simply be more convenient.

<h2>
 2. There's no requirement for them to be used.
</h2>

 A common misunderstanding is that Required Minimum Distributions (RMDs) compel you to deplete your retirement savings annually. While it’s correct that failing to withdraw RMDs from a tax-favored account can result in significant fines, the Internal Revenue Service (IRS) does not mandate how you use these distributions. You have control over whether you choose to spend them or not.


 If you find yourself financially secure enough not to rely on these funds for daily costs, you could opt to withdraw your Required Minimum Distributions (RMDs) and channel them into a taxable investment account instead. Alternatively, you might choose to create a certificate of deposit (CD) staircase at an institution providing competitive returns. In this case, remember that any profits or interests generated will not benefit from favorable taxation. However, having those extra funds available means you retain the flexibility to continue expanding your wealth without feeling pressured to allocate it towards particular expenditures.

<h2>
 3. Giving them away might wipe out your tax liability.
</h2>

 The primary issue with Required Minimum Distributions (RMDs) is that retirees often find themselves obligated to pay taxes on withdrawals they might not require. However, it’s not guaranteed that these RMDs will result in a significant tax liability for you.


 If you contribute your Required Minimum Distributions (RMDs) to charity through what’s called a qualified charitable distribution, you can avoid taxation. However, the crucial point is to direct your RMD payment straight to an eligible nonprofit, rather than withdrawing the funds yourself and subsequently issuing a separate donation check.


 Retirees often face Required Minimum Distributions (RMDs), yet these distributions do not always disrupt their financial situation later in life. You can adopt strategies to prevent having RMDs altogether. However, should such measures fail, there are methods to handle your RMDs effectively and profitably. Additionally, seeking advice from a financial consultant could prove beneficial in handling both your RMDs and the potential taxes tied to them.

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3 Essential RMD Tips Every Boomer Needs to Know

Unknown individual retirement accounts, money management, personal finance retirement, retirement, retirement planning

Key Points Retirement account distributions can pose challenges for older individuals unprepared to start using their saved funds. Some tax-favored retirement pla…

From $5.15/Hr at Taco Bell to $3.5M by 39: My Simple Rule for Financial Freedom

Unknown investing, personal finance careers, personal finance retirement, retirement planning, work and pay

American Jamal Robinson joined the workforce with a single objective: to achieve retirement at the earliest opportunity.


 The individual, who is 40 years old, mentioned during his conversation that he established a retirement target for himself at a young age, specifically when he was a teenager.
 CNBC Make It
 .


 Robinson stated, 'I always believed that condensing that period of my life into less time would be the most logical approach.'


 'At the age of 17, I decided to aim for early retirement by 45, but surprisingly achieved this goal six years ahead of schedule.'


 Having retired, Robinson has been enjoying a comfortable life in
 Dubai
 from his $3.5 million savings.


 What are the keys to achieving success? It involves saving money, making investments, and concentrating on sustaining your financial independence.


 Nevertheless, it took Robinson some time to achieve his objective, during which he earned $5.15 per hour at Taco Bell.

<img data-document-id="cms/api/amp/image/AA1CmsxO" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1CmsxO.jpg"/>

 Robinson acknowledged that his upbringing without significant financial resources influenced the way he managed and accumulated wealth later in life.


 "I felt quite alone in the world without substantial backing, so I believed it was crucial to accumulate as much wealth as possible, just in case anything went wrong and I needed to fend for myself," he elaborated.


 This taught him about the 'importance of money' early on and secured his first employment as a church custodian at just 14 years old.


 When he was 16, he started doing lengthy shifts at Taco Bell while going to school.


 Robinson received a full scholarship to attend Tennessee Tech where he obtained bachelor’s degrees in both computer engineering and mathematics.


 After graduating, the technology specialist started his initial full-time position with an annual salary of $41,000, which eventually grew consistently to reach $225,000.


 His compensation increased to $400,000, then $727,000, and ultimately reached $1 million.


 As he worked, he continued his education to obtain additional qualifications.
 
 nine post-graduate certifications in business and technology along with an MBA.
 

<img data-document-id="cms/api/amp/image/AA1Cmv9p" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1Cmv9p.jpg"/>

 
 Robinson collaborated with firms such as
 Amazon
 ,
 Microsoft
 ,
 IBM
 And prior to his retirement from Intel, he went on to become a data science professor at UC Berkeley.
 


 
 Nevertheless, despite his resume and salary being at an all-time high, he never saw himself as a major spender.
 


 "I still see myself today as just a minimum-wage worker earning $5.15 an hour," Robinson confessed.


 'I'd earn $1 million annually, yet find it challenging to splurge more than $50 on a single purchase.'


 Rather than indulging in costly purchases, he continued to save his funds, realizing it would only hasten his path to retiring.


 "I progressed from saving 30 percent to 50 percent, then to 80 percent and even up to nearly 90 percent," Robinson stated.


 'This would have excited me even more, as I realized it sped up my journey toward eventually retiring.'


 As a tech leader with expertise in generative AI, he decided to resign after amassing a portfolio worth $3.5 million, even though he was earning $1.1 million annually.

<img data-document-id="cms/api/amp/image/AA1Cmqao" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1Cmqao.jpg"/>

 'Many believe it's insane for me to depart from AI when it holds such significance,' Robinson stated.


 'For me, it has always been crucial to concentrate on achieving my retirement objective so I can dedicate time to personal growth and ensure that I am contributing positively to making the world a better place.'


 Upon retiring, Robinson adopted a four percent withdrawal strategy, enabling him to generate an annual income of $185,000.


 This total amounts to roughly $15,400 per month; however, the ex-tech executive typically expends between $9,000 and $12,000 within that period.


 "If you maintain a disciplined and responsible approach towards [the money you have earned], then using it for experiences that simplify your life or positively influence others' lives — these actions are not detrimental," he emphasized.


 Robinson easily adjusted to life in Dubai, stating that it isn’t more costly than residing in major American cities he has previously lived in.


 "If I invest the same amount of money here, I usually have a far more enjoyable time. Alternatively, if I choose to spend less, I still receive an equally satisfying experience," he mentioned.


 Even though he lives under those conditions, Robinson stated that he wouldn’t be paying taxes in Dubai but intends to settle with the IRS because he’s an American residing overseas.

<img data-document-id="cms/api/amp/image/AA1Cmqar" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1Cmqar.jpg"/>

 Robinson is striving to adjust his investment portfolio, which includes multiple technology-based stocks.


 He likewise has a passion for DJing and is presently engaged in authoring a book along with crafting a podcast.


 "I am concentrating on my own spiritual development," he stated, mentioning that his current emphasis is on the present moment rather than speculating about the future.


 His work visa will end in July with his previous employer, and he intends to depart from Dubai after that.

Read more

From $5.15/Hr at Taco Bell to $3.5M by 39: My Simple Rule for Financial Freedom

Unknown investing, personal finance careers, personal finance retirement, retirement planning, work and pay

American Jamal Robinson joined the workforce with a single objective: to achieve retirement at the earliest opportunity. The individual, who is 40 years old, mentioned during his conversation that …

まさか、夢だと言ってくれ…「年金月18万円」75歳男性、「コツコツと貯めた 2,000万円」が老後10年で底をつく大誤算。きっかけは48年間連れ添った愛妻の死

Unknown money, personal finance, personal finance retirement, retirement planning, wealth

<img data-document-id="cms/api/amp/image/AA1Cbcd4" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1Cbcd4.jpg"/>


 老後資金2,000万円不足問題のインパクトから、「老後のために2,000万円は貯める！」と目標を定めている人は多いようです。しかし、2,000万円の貯金があるからといって、老後の安心は絶対かといえば、そのようなことはありません。

<h2>
 妻と過ごすはずだった、安泰の老後
</h2>

 年金不安から資産運用が当たり前になりつつあるなか、最終的な目標額はいくらなのでしょうか。金融広報中央委員会『家計の金融行動に関する世論調査（二人以上世帯）』によると、金融資産目標額は平均で3,014万円。中央値は1,500万円でした。年齢別にみていくと、60代で平均3,397万円、中央値は2,000万円。70代では平均2,723万円で、中央値は2,000万円。一時、老後資金2,000万円不足と騒がれていました。その余波でしょうか、老後を見据えて「2,000万円」をひとつの目標にしていると推測されます。


 75歳の原和夫さん（仮名）もそのひとり。長年会社員として働き、退職金とコツコツ貯めた預貯金を合わせ、65歳の時点で老後資金は約2,000万円を確保していました。


 「ひとり1,000万円、夫婦であれば2,000万円あれば、老後は安心だと思っていたんです」


 65歳から受け取り始めた年金は月18万円ほど。その3年後には妻も年金を受け取り始め、派手な暮らしではないものの、妻とふたり、穏やかな老後を送っていました。


 しかし、結婚48年を迎えて、妻が68歳で急逝。そこから、原さんの生活は大きく狂い始めます。最初に家計を大きく圧迫したのは、自宅の修繕費でした。


 
 「持ち家だったので、住居費の心配はないと思っていました。でも、築35年ともなると、あちこちガタがくるんですよ」
 


 特に深刻だったのは、水回りと屋根の劣化。そこに追い打ちをかけるように大型台風の襲来。それによりキッチンや浴室の配管から水漏れが発生し、屋根瓦の一部も剥がれました。修理を後回しにするわけにもいかず、見積もりを取ると、なんと約500万円。痛い出費でしたが、長年妻と過ごしたマイホーム。いつまでもここで住み続けたい……そう考えると仕方のない出費でした。

<h2>
 妻に先立たれ、崩れ始めた老後プラン
</h2>

 さらに、妻に先立たれひとり暮らしになったことで、日常の生活費もじわじわと増えていきました。家事はすべて妻に任せきりだった原さんは家事力ゼロ。次第に家のなかは散らかり放題。洗濯はもちろん、食事も自分で作ることはできません。乱れていくばかりの日常をどうにかしようと、家事代行サービスを利用するようになりました。さらに外食の回数も増え、妻とふたり暮らしのときよりもかさむようになったのです。そのような生活により、毎月10万～15万円程度を貯金から取り崩し。


 そこへ追い打ちをかけたのが、健康の問題でした。「加齢とともに、病院に行く機会が増えました。持病の薬代に加え、歯の治療や白内障の手術など、思った以上にお金がかかるんです」。こうした想定外の出費が続き、原さんの貯蓄は右肩下がり。


 焦った原さんは、ある決断をします。世間では「資産運用」ブーム。この流れに乗れば、資産を増やすことができるかもしれない……何とも安直な理由で投資をスタートさせます。


 当初は、銀行の勧めで投資信託を購入。しかし値動きが思った以上に激しく、不安になった原さんは、途中で売却。結果的に、数十万円の損失を出してしまいました。それでも諦めきれず、今度は個別株に手を出します。「高配当株なら年金の足しになる」との触れ込みを信じましたが、株価の変動に一喜一憂する日々が続き、また途中で売却。結局、利益を出すどころか損失ばかりが積み重なり、10年前に2,000万円あった貯蓄は、ほぼ底をついてしまったのです。


 
 「まさか、夢だと言ってくれ……」
 


 70代半ばにして、生活レベルを大幅に下げざるを得ない状況に直面している原さん。


 
 「年金18万円だけで、この先の生活を賄わないといけません。でも家の維持費もかかるだろうし、医療費のことも考えないといけない。不安しかないですね」
 


 原さんのケースは決して特殊なものではありません。老後の想定外の出費は、誰にでも起こりうること。特に、自宅の修繕費や医療費は、思った以上にかかることが多いといいます。さらに原さんの場合、未経験ながら投資に手を出し、損失をさらに拡大させました。「まさか、こんなはずでは……」と後悔しないために。老後資金の準備は、想定以上の余裕をもって考えておくことが大切なのかもしれません。


 ［参考資料］


 金融広報中央委員会『令和5年 家計の金融行動に関する世論調査（二人以上世帯）』

まさか、夢だと言ってくれ…「年金月18万円」75歳男性、「コツコツと貯めた 2,000万円」が老後10年で底をつく大誤算。きっかけは48年間連れ添った愛妻の死

Unknown money, personal finance, personal finance retirement, retirement planning, wealth

老後資金2,000万円不足問題のインパクトから、「老後のために2,000万円は貯める！」と目標を定めている人は多いようです。しかし、2,000万円の貯金があるからといって、老後の安心は絶対かといえば、そのようなことはありません。妻と過ごすはずだった、安泰の老後年金不安から資産運用が当たり前になりつつあるなか、最終的な目標額はいくらなのでしょうか。金融広報中央委員会『家計の金融行動に…

Should You Take Superannuation as a Lump Sum or an Income Stream? Find Out Which is Better!

Unknown income, investing, money, personal finance retirement, retirement planning

<img data-document-id="cms/api/amp/image/AA1uAzQE" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1uAzQE.jpg"/>

 Australians heading into
 retirement
 face a tough decision on how to access their hard-earned
 superannuation
 .


 The question is: Should you opt for a lump sum, an income stream, or a combination of both?


 And just like every broad-based question in life, it circles back to the cliched but truthful answer: "It depends".


 That's not ideal for someone seeking a more definitive answer, but what you can do is understand the pros and cons of both routes to obtaining your money. Here's a breakdown to help you make an informed choice.

<h2 class="wp-block-heading" id="h-options-for-accessing-superannuation">
 Options for accessing superannuation
</h2>

 When you retire, you can withdraw your super as a lump sum, convert it into an income stream, or combine the two. Each approach offers unique benefits and trade-offs.


 A single payment provides you full control over your complete superannuation funds right away, allowing you to utilize them for settling debts, making investments, or indulging in well-desired extravagances.


 
 Lump sumsÂ are typically
 tax-free for people aged 60 or above
 . However, not
 
 All funds provide this feature.


 As per MoneySmart, this superannuation choice might attract you if you carry high-interest debts or plan to make substantial one-time buys, like reducing the size of your house.


 However, investing significant sums initially might drain your retirement savings more quickly than anticipated, possibly resulting in reduced finances during your later years.


 Investing beyond your superannuation could subject you to increased tax rates compared to what’s offered inside the super system, particularly when trading shares or real estate.


 It largely hinges on what you project your yearly living costs will amount to. These projections should encompass elements such as vacations and doctor visits, among others.
 what type of retirement
 you wish for.


 The viability of this option can also hinge on your ultimate superannuation account balance. Those with larger balances may find this choice more appealing.

<h2 class="wp-block-heading" id="h-what-about-an-income-stream">
 How about generating an income stream?
</h2>

 When you have a steady flow of income, your superannuation gets transformed into consistent payouts, much like receiving a wage. These disbursements keep coming during your retirement, akin to a sinking fund, though they might be put back into investments as well.


 This approach provides a consistent earnings stream, tax-free investment gains, and might assist in safeguarding your retirement funds for future years.


 Revenue sources offer significant flexibility, enabling you to select payment schedules and amounts while adhering to minimum withdrawal requirements.


 Nevertheless, the maximum amount you can move into a retirement-phase account is limited to $1.9 million due to the transfer balance cap.

<h2 class="wp-block-heading" id="h-por-que-no-los-dos-why-not-both">
 Why not both?
</h2>

 A lot of people after retiring choose a blend of these options. They might withdraw part of their superannuation as a lump sum to handle upfront costs, while keeping the rest invested in an income stream for steady, ongoing financial support.


 It seems like you're getting everything at once, but there are some catches.


 Money continues to be utilized within the superannuation system, which means these funds may not be easily accessible when required. Others could find alternative investment opportunities where the capital might serve them better financially.


 Once again, this depends on the specific circumstances, but there are several methods to tap into the revenue stream, such as
 account-based stream and annuities.


 As stated by the Australian Tax Office, several tax offsets apply to the income portion as well.

<h2 class="wp-block-heading" id="h-superannuation-takeaway">
 Superannuation takeaway
</h2>

 Your choice between taking your superannuation as a one-time lump sum, an ongoing income stream, or combining both will depend on your individual situation.


 Every choice comes with advantages and disadvantages, making it essential to weigh them all to guarantee your superannuation aids in fulfilling your retirement aspirations.


 Regardless of the situation, having all the key information can assist in making sound choices.


 The post
 Is it preferable to withdraw your superannuation as a one-time lump sum or an ongoing income stream?
 appeared first on
 The Motley Fool Australia
 .

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Should You Take Superannuation as a Lump Sum or an Income Stream? Find Out Which is Better!

Unknown income, investing, money, personal finance retirement, retirement planning

Australians heading into retirement face a tough decision on how to access their hard-earned superannuation . The question is: Should you opt for a lump sum, an income stream, or a combination …

Here's How Your Social Security Benefits Compare at Ages 62, 67, and 70

Unknown personal finance retirement, retirement, retirement planning, senior citizens, social security

Over eighty years, Social Security has provided monthly benefits to those who have retired. Although these payments aren’t enriching anyone, they’ve become essential for many retirees.


 For the past 23 consecutive years, Gallup has carried out a survey to assess the degree of reliance retired workers have on their received incomes.
 Social Security
 These surveys indicate that between 80% to 90% of retirees depend on their regular monthly payment to help with their living costs.


 
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 An independent study conducted by the Center on Budget and Policy Priorities revealed that without Social Security, the poverty rate among adults aged 65 and older would be approximately four times greater — standing at 10.2% as of 2022 with Social Security compared to an estimated 38.7% if not for Social Security.


 Hence, maximizing benefits from Social Security will be crucial for the financial health of most upcoming retirees.

<div class="image">
 <img data-document-id="cms/api/amp/image/AA1wj7A4" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1wj7A4.jpg"/>
</div>

 However, to get the most out of your Social Security benefits, you must first grasp how these payments are determined. Only after understanding this will you be able to
 understand the significance of your declared age
 , and how choosing to collect at an earlier age (62), a mid-point age (67), or a later age (70) could affect your monthly benefits.

<h2>
 The calculation of your monthly Social Security benefit involves these four elements.
</h2>

 Even though Social Security occasionally has unexpected elements for beneficiaries — were you aware that Social Security benefits may be subject to taxation at the federal level?
 in addition to nine states
 The four elements utilized by the Social Security Administration (SSA) to determine your monthly benefit amount are clear-cut:

<ol>
 <li>
 Work history
 </li>
 <li>
 Earnings history
 </li>
 <li>
 Full retirement age
 </li>
 <li>
 Claiming age
 </li>
</ol>

 Your job performance and financial record are closely linked. When determining your monthly payout, the Social Security Administration considers your top 35 years of earnings adjusted for inflation. Earning a higher average wage or salary over your career—note that investment income does not factor in here—increases your chances of getting a larger monthly benefit once you retire.


 However, irrespective of your annual income, you will face penalties if your work record falls short of 35 years. The SSA will add zeros for each year below 35 that you haven’t worked when calculating your benefits. To ensure your Social Security payments help cover living expenses after retiring, aim to log at least three decades and five years of employment.


 The third factor, known as your full retirement age, is
 based on the year of your birth
 It signifies the age at which you qualify to receive your full retired-worker benefit, and this aspect is the sole element beyond our control.


 Lastly, but without being of lesser importance,
 Your stated age can greatly influence the fluctuation of both your monthly and lifetime payout amounts.
 Although you may start receiving retirement benefits as young as 62 years old, there’s a financial motivation to be more patient. Specifically, each additional year an individual delays claiming their benefits from age 62 through age 70 can increase their payment amount by approximately 8%. The chart illustrates how these increments vary based on when your full retirement age falls.

<table>
 <tr>
 <td class="xl65">
 
 Birth Year
 
 </td>
 <td class="xl65">
 
 Age 62
 
 </td>
 <td class="xl65">
 
 Age 63
 
 </td>
 <td class="xl65">
 
 Age 64
 
 </td>
 <td class="xl65">
 
 Age 65
 
 </td>
 <td class="xl65">
 
 Age 66
 
 </td>
 <td class="xl65">
 
 Age 67
 
 </td>
 <td class="xl65">
 
 Age 68
 
 </td>
 <td class="xl65">
 
 Age 69
 
 </td>
 <td class="xl65">
 
 Age 70
 
 </td>
 </tr>
 <tr>
 <td>
 1943-1954
 </td>
 <td class="xl64">
 75%
 </td>
 <td class="xl64">
 80%
 </td>
 <td class="xl63">
 86.7%
 </td>
 <td class="xl63">
 93.3%
 </td>
 <td class="xl64">
 100%
 </td>
 <td class="xl64">
 108%
 </td>
 <td class="xl64">
 116%
 </td>
 <td class="xl64">
 124%
 </td>
 <td class="xl64">
 132%
 </td>
 </tr>
 <tr>
 <td>
 1955
 </td>
 <td class="xl63">
 74.2%
 </td>
 <td class="xl63">
 79.2%
 </td>
 <td class="xl63">
 85.6%
 </td>
 <td class="xl63">
 92.2%
 </td>
 <td class="xl63">
 98.9%
 </td>
 <td class="xl63">
 106.7%
 </td>
 <td class="xl63">
 114.7%
 </td>
 <td class="xl63">
 122.7%
 </td>
 <td class="xl63">
 130.7%
 </td>
 </tr>
 <tr>
 <td>
 1956
 </td>
 <td class="xl63">
 73.3%
 </td>
 <td class="xl63">
 78.3%
 </td>
 <td class="xl63">
 84.4%
 </td>
 <td class="xl63">
 91.1%
 </td>
 <td class="xl63">
 97.8%
 </td>
 <td class="xl63">
 105.3%
 </td>
 <td class="xl63">
 113.3%
 </td>
 <td class="xl63">
 121.3%
 </td>
 <td class="xl63">
 129.3%
 </td>
 </tr>
 <tr>
 <td>
 1957
 </td>
 <td class="xl63">
 72.5%
 </td>
 <td class="xl63">
 77.5%
 </td>
 <td class="xl63">
 83.3%
 </td>
 <td class="xl64">
 90%
 </td>
 <td class="xl63">
 96.7%
 </td>
 <td class="xl64">
 104%
 </td>
 <td class="xl64">
 112%
 </td>
 <td class="xl64">
 120%
 </td>
 <td class="xl64">
 128%
 </td>
 </tr>
 <tr>
 <td>
 1958
 </td>
 <td class="xl63">
 71.7%
 </td>
 <td class="xl63">
 76.7%
 </td>
 <td class="xl63">
 82.2%
 </td>
 <td class="xl63">
 88.9%
 </td>
 <td class="xl63">
 95.6%
 </td>
 <td class="xl63">
 102.7%
 </td>
 <td class="xl63">
 110.7%
 </td>
 <td class="xl63">
 118.7%
 </td>
 <td class="xl63">
 126.7%
 </td>
 </tr>
 <tr>
 <td>
 1959
 </td>
 <td class="xl63">
 70.8%
 </td>
 <td class="xl63">
 75.8%
 </td>
 <td class="xl63">
 81.1%
 </td>
 <td class="xl63">
 87.8%
 </td>
 <td class="xl63">
 94.4%
 </td>
 <td class="xl63">
 101.3%
 </td>
 <td class="xl63">
 109.3%
 </td>
 <td class="xl63">
 117.3%
 </td>
 <td class="xl63">
 125.3%
 </td>
 </tr>
 <tr>
 <td>
 1960 or later
 </td>
 <td class="xl64">
 70%
 </td>
 <td class="xl64">
 75%
 </td>
 <td class="xl64">
 80%
 </td>
 <td class="xl63">
 86.7%
 </td>
 <td class="xl63">
 93.3%
 </td>
 <td class="xl64">
 100%
 </td>
 <td class="xl64">
 108%
 </td>
 <td class="xl64">
 116%
 </td>
 <td class="xl64">
 124%
 </td>
 </tr>
</table>

 Data source: Social Security Administration.

<h2>
 What is the typical Social Security payment amount at age 62, age 67, and age 70?
</h2>

 Even though each year from the standard collection span of 62 to 70 offers distinct pros and cons,
 Three claimed age groups are expected to become particularly favored moving forward.
 62, 67, and 70.


 Let’s quickly explore the advantages and disadvantages of filing for benefits at these three different ages, and then examine what the typical recipient receives monthly when they claim at 62, 67, and 70 years old.

<ul>
 <li>
 
 
 What's the advantage of collecting benefits at age 62?
 
 The attraction of receiving benefits at age 62 lies in not needing to hold off before accessing your entitlements. Additionally, there’s the potential for
 extensive reductions in Social Security benefits by 2033
 Receiving your payment immediately could be seen as a strategy to avoid potential decreases.
 
 
 Conversely, your payment will have a permanent reduction of 25% to 30% once you start receiving benefits at age 62 (the exact percentage depends on your birth year). Furthermore, you might face additional penalties for filing early.
 like the retirement earnings test
 This enables the SSA to deduct part or all of your benefits based on your earnings.
 
 </li>
 <li>
 
 What is the reason for collecting at age 67?
 
 This might swiftly turn into the favored claiming age due to the fact that 67 is considered the full retirement age for those born in 1960 or later, which includes a majority of today’s working population. Starting benefits at this age ensures there will be no decrease in your monthly benefit amount. However, the drawback of opting for this age is that should you live well past your eighties, retrospectively speaking, you may end up foregoing substantial Social Security payments.
 </li>
 <li>
 
 What is the purpose of collecting at age 70?
 
 Claiming benefits at age 70 ensures that you receive the highest possible monthly payment, increasing it by 24% to 32% compared to what you'd get at your full retirement age, depending on when you were born. However, this strategy doesn’t ensure that you’ll live sufficiently long to fully capitalize on these higher lifetime payouts from Social Security.
 </li>
</ul>

 Having gained insight into the advantages and disadvantages of these three filing ages, we can now look at the typical Social Security benefits received at age 62, 67, and 70.


 Each year, the SSA's Office of the Actuary publishes a detailed analysis outlining the
 mean monthly assistance for retired workers aged from 62 up to those over 99
 . Bear in mind this information is derived from
 age
 Of retirees who stopped working as of December 2023, this doesn’t necessarily reflect the age at which they started receiving benefits, unless they were 62 years old.


 Given these points, approximately 590,000 residents live in the area.
 The typical retired worker aged 62 received an average monthly benefit of $1,298.26.
 In December 2023, approximately 2.92 million retired individuals received payments.
 mean payment of $1,883.50 upon reaching 67 years old
 Finally, approximately 3.01 million recipients who have retired are benefiting from this program.
 saved an average advantage of $2,037.54 upon reaching 70 years old.
 .


 Across the entire range of the conventional claiming spectrum, those who waited until they were 70 years old received, on average, 57% more compared to individuals who started collecting benefits at the earliest opportunity.

<div class="image">
 <img data-document-id="cms/api/amp/image/AA1wiWeK" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1wiWeK.jpg"/>
</div>
<h2>
 Statistically speaking, there
 is
 an older supervisor citing typical retirement ages
</h2>

 Given the significant differences in monthly benefits, you may be questioning whether choosing certain ages within the typical claiming window offers future retirees an advantage for optimizing their Social Security income. A thorough statistical study reveals that there indeed is such an optimal age.


 In 2019, researchers from United Income published a study,
 The Overlooked Retirement Plan Right Before Our Eyes
 , analyzed the claim decisions of 20,000 retirees utilizing data from the University of Michigan’s Health and Retirement Study. The objective was to determine whether any particular age could maximize Social Security benefits. Here, an “optimal” distribution refers to one that would yield the highest benefit amount.
 lifetime
 (key word!) income collection.


 As one would anticipate, this comprehensive study revealed that merely 4% of the 20,000 retirees analyzed had filed for benefits at the ideal time. Given that our life expectancy is unknown beforehand, there's
 There will always be some level of uncertainty involved.
 When reaching our claim determination.


 Moreover, each of us follows our distinct journey towards retirement. Our individual mix of financial requirements, available retirement savings options, marital situation, tax consequences, personal well-being, among others factors, can vary greatly from person to person. Given this diversity, there isn’t a single plan that suits everyone, which naturally leads to differences in when and how people decide to claim their benefits.


 However, the more important find is the nearly perfect inversion between actual and optimal claims. Although 79% of the 20,000 retired workers began receiving their benefit from ages 62 through 64,
 Only 8% of the claims in this range were eventually found to be optimal.
 .


 On the flip side, even though just a tiny fraction of retirees delayed claiming their Social Security benefits until they reached age 70, this still occurred.
 ideal for 57%, which amounts to 20,000 retirees examined
 .


 To be fair, this does not imply that every future retiree needs to wait until they turn 70 before starting to collect benefits. Individuals who suffer from one or more long-term illnesses that could reduce their life expectancy might have valid reasons for opting to receive payments at an earlier age.


 However, according to this comprehensive statistical assessment, being patient is likely to yield substantial rewards for most future retirees. This is an important consideration should you anticipate relying on Social Security, in whatever role, to cover your expenses during retirement.

<h2>
 The $
 
 22,924
 
 The Social Security benefit many seniors entirely miss out on.
</h2>

 If you’re similar to many Americans, you might be lagging several years—or even more—behind on saving for retirement. However, some lesser-known “ Social Security tips” may assist in increasing your post-retirement earnings. For instance: one simple strategy has the potential to net you an extra $
 
 22,924
 
 More every year! After mastering strategies to optimize your Social Security benefits, we believe you can retire with confidence and achieve the peace of mind everyone seeks.
 Just click here to find out how you can learn more about these tactics.


 
 Check out the "Social Security secrets" »
 


 The Motley Fool has a
 disclosure policy
 .

Here's How Your Social Security Benefits Compare at Ages 62, 67, and 70

Unknown personal finance retirement, retirement, retirement planning, senior citizens, social security

Over eighty years, Social Security has provided monthly benefits to those who have retired. Although these payments aren’t enriching anyone, they’ve become essential for many retirees. For the past…

Retiring at 67 with $3M: Do You Need a Financial Planner to Protect Your Nest Egg?

Unknown financial advice, financial planning, personal finance retirement, retirement, retirement planning

<img data-document-id="cms/api/amp/image/AA1BxpVj" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1BxpVj.jpg"/>

 A 2024 CPP Investments
 survey found that
 Canadians believe they will require $900,000 for a comfortable retirement, marking a 29% rise compared to the previous year.


 However, according to Statistics Canada from 2024
 report revealed
 The median retirement savings of Canadians stands at $573,040. This indicates that most retirees face a significant shortfall.


 If you’ve retired with a $3 million portfolio, you're certainly doing better than most. You not only possess far greater assets compared to an average Canadian retiree but also surpass the recommended $900,000 per individual needed for a comfortable retirement.


 However, you might be pondering whether it’s worth hiring a financial planner to assist with managing your retirement funds. The reality is that there are both advantages and disadvantages to seeking professional financial assistance.

<h2>
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<h2>
 Using a financial planner
</h2>

 If you possess $3 million in assets, own your home outright, and do not have any significant financial worries, you may think that hiring an expert isn’t necessary. However, there’s good cause for reconsidering this assumption.
 25% of Canadians
 possess a financial advisor or planner, according to research conducted by CIBC and FP Canada.


 The advantage of collaborating with a financial advisor is having someone knowledgeable who remains unemotional about your finances providing guidance on managing your resources. This can be incredibly valuable, particularly when unexpected challenges arise in life.


 Your financial situation might currently be strong, but what happens if your life changes or your health deteriorates, leading to the need for prolonged medical support?


 If you lack insurance coverage, the cost of hiring a home health aide might range from approximately $3,500 to $30,000 each month.
 The Scotia Wealth Management report discovered
 A financial advisor or planner can assist you not just in preparing for such expenses, but also in managing them when they come up.


 Moreover, even though you've demonstrated considerable knowledge about savings and investments by accumulating $3 million before retiring, there might still be gaps in your investment strategy. Consulting with a financial advisor could assist in identifying these areas and ensuring that your portfolio is structured both to generate revenue and endure significant economic downturns or high inflation periods.


 Additionally, with $3 million at your disposal, you might consider leaving an inheritance behind. However, keep in mind that the worth of $3 million now won’t remain the same as $3 million later, particularly if inflation rises sharply. Consulting with a financial advisor will help you explore various estate planning strategies, enabling you to make well-informed choices about the kind of heritage you want to pass along.


 Ultimately, collaborating with a financial advisor might assist you in feeling more at ease during your later years; this shifts the responsibility from you being the expert to someone who keeps up with the latest information.

<h2>
 Managing your finances solo
</h2>

 A clear drawback of collaborating with a financial advisor is the extra expense incurred. This cost might differ based on various factors such as the specific individual you choose, your location, and the fee model utilized by your advisor. Should you handle your finances independently, you would avoid paying these professional charges altogether.


 Suppose a financial advisor charges you a fee equivalent to 1% of your total assets under management. In the case of a $3 million portfolio, this amounts to an annual charge of $30,000 for assistance that might be unnecessary.


 Certainly, numerous financial advisors earn compensation based on a percentage of the assets they manage. This incentivizes them to expand your investment portfolio further so their earnings increase accordingly. However, upon retirement, what might matter most isn’t necessarily growing your wealth but ensuring a consistent stream of income. If this stability is already achieved, then hiring an advisor could seem less necessary.


 If you have successfully built and managed your investment portfolio over the years, you might be well-prepared to keep doing so—particularly if you are an astute investor attuned to market trends and recognize the significance of diversifying your assets.


 Moreover, although a financial advisor may provide advice on estate planning, you'll generally require an attorney to draft a will or trust (or whichever instrument you choose for passing down an inheritance). Thus, even though a financial expert might help guide you towards your preferred choice, you're likely facing additional legal fees separately.


 Before finalizing your choice, consider meeting with one or two advisors to get their input. However, if you've reached $3 million and are handling things effectively, hiring additional assistance might not be necessary right now. Ensure that prior to making significant financial decisions, you gather all the information available. In essence, you're acting as your own advisor.

<h2>
 Read More
</h2>
<ul>
 <li>
 Unforeseen medical expenses can accumulate rapidly, even within Canada’s healthcare framework.
 
 cost-effective health coverage
 
 to safeguard you and those dear to you
 </li>
</ul>
<h4>
 Sources
</h4>

 1.
 CPP Investments:
 Almost two out of every three Canadians express concerns about their retirement savings, according to a recent survey released on October 30, 2024.


 
 2.
 Statistics Canada:
 Economic Family Type Assets and Debts by Age Group for Canada, Provinces, and Selected Census Metropolitan Areas, Survey of Financial Security (in millions) (October 29, 2024)
 


 3.
 Cision:
 A vast majority of Canadians are tackling financial planning independently according to the CIBC and FP Canada™ Survey (multiplied by 1,000,000) (November 27, 2023).


 
 4.
 Scotia Wealth Management:
 Why staying at home as we age remains out of reach for numerous Canadians—and what can be done about it (January 9, 2024)
 


 This article
 At age 67, after retiring with a $3 million investment portfolio and owning a home free of mortgage, would it be worthwhile to hire a financial advisor to guarantee our savings will endure throughout retirement?
 originally appeared on Money.ca

<h2>
 What To Read Next
</h2>
<ul>
 <li>
 In 2024, Warren Buffett shifted his focus to include Canadian stocks — here’s
 
 Three tactics enabling you to invest akin to an expert
 
 </li>
 <li>
 Want to boost your retirement savings from $183K to $833K? Consider these essential tactics:
 
 update your retirement savings
 
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 Boost your savings and reduce taxes — look into this option
 
 right investment account
 
 For your monetary objectives today
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 The content of this article serves solely as information and must not be interpreted as advice. No warranties of any sort are provided with this material.

Retiring at 67 with $3M: Do You Need a Financial Planner to Protect Your Nest Egg?

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 「FIRE」という言葉が注目されています。FIREとは、Financial Independence, Retire Earlyの略で、『経済的な自立を実現させて、仕事を早期に退職する生活スタイル』のこと。FIREに憧れるものの、いざ実行となると敷居が高いところ。それなら、60歳で仕事を辞めるのは実現できるかも……。


 とはいっても、誰でも60歳で仕事が辞められるものではありません。60歳で仕事を辞めたい人は、どういうことをしておくべきでしょうか？


 <h2>
 1）住宅ローンは完済、教育費は別貯め
 </h2>
 一番避けたいのは、リタイア後も多額の固定費がかかること。リタイア後の基本生活費はできるだけコンパクトにしたいものです。


 まずは、住宅ローンの返済が60歳までに終わるようにしておきましょう。住宅ローンの返済が残っていると、家計の収支はかなり悪化します。退職金でローンを完済する計画もアウト。退職金はリタイア後の生活の基盤となるものです。現役時代に住宅ローンは完済しましょう。


 同様に、60歳を超えても子どもの教育費がかかる人も要注意です。教育費は予想以上にかかります。自分たちの老後のお金を教育費にあてることは厳禁です。最低でも学費分は自分たちの老後のお金とは別に貯めておきましょう。


 <h2>
 2）個人型確定拠出年金iDeCo等で年金上乗せ
 </h2>
 老後の生活の支えとなるのは公的年金（老齢年金）でしょう。60歳から75歳（※）の間で好きな時から年金が受給できます。65歳以降に年金を受け取る「繰り下げ受給」をすると、65歳で受け取るはずの基準額より1カ月あたり0.7％年金額が増額されます。


 ※昭和27年4月2日以降生まれの人、受給権発生日が平成29年4月1日以降の人が該当


 70歳まで繰り下げをすると42％、75歳までで82％も65歳受給時より年金額が増えます。生涯受け取れる年金ですから、長生きのリスクに備えるために、少しでも年金額を増やしておきたいところ。


 そのためには、私的年金を準備しましょう。私的年金で生活する期間を設け、公的年金の受給開始を遅らせるのです。年金額を増やすと、年金だけで生活できる可能性が高くなります。60歳でリタイアするなら、少なくとも、70歳までは私的年金等で生活費をまかない、70歳以降から公的年金を受給するようにしましょう。


 この私的年金として、税制メリットがある「個人型確定拠出年金（iDeCo）」を利用するとよいでしょう。年金の上乗せをしっかりしておくことが大切です。


 <h2>
 3）受給できる年金額を確認
 </h2>
 老後生活の収入は公的年金がメインとなります。その年金額を知っておかないと、リタイア可能かどうかも判断できません。将来の年金額を知るには、「ねんきんネット」を利用しましょう。年金記録を確認し、年金見込額を試算することができます。将来の働き方などで年金額の変化をシミュレーションすることもできます。


 毎年、誕生月に送られてくる「ねんきん定期便」に記入されているアクセスキーと基礎年金番号があれば、すぐに利用することができます（アクセスキーがなくても、基礎年金番号がわかれば利用できます。基礎年金番号がわからない場合は、ねんきん定期便から基礎年金番号を知ることも可能です）。


 2）で準備したiDeCoなどの個人年金を利用し、公的年金の受給を70歳以降にできそうな場合は、受給開始年齢と受給額を把握しておきます。


 <h2>
 4）基本生活費を把握
 </h2>
 老後の家計の収入がわかれば、次は支出を把握する必要があります。毎月の生活費が年金受給額以内におさまる家計を目指したいからです。一般的には、リタイア後の生活費は現役時代の7割程度といわれています。ということは、現役時代の生活費を把握しなくてはいけません。


 現在の毎月の支出（教育費や住宅ローンを除く）を把握するために、3カ月間は全ての支出を家計簿につけます。スマホの家計簿アプリなどもありますから、まずは使いやすいもので全支出を管理します。また、年単位で支出するもの（固定資産税、車関連費用、年払いの保険料など）もリストアップしておきましょう。


 1年でかかる生活費がわかれば、老後の生活費も予想できます。税金やマンションの管理費などは現在の金額を、食費や交際費などの生活費は今の7割と仮定して老後の生活費を予想します。


 <h2>
 5）60歳までに貯めるべき金額を把握・計画
 </h2>
 最後に、60歳までに用意するべき預貯金額を知り、その金額を貯めることができるのであれば、60歳リタイアは可能ということになります。3）で年金収入を、4）で老後の生活費を把握することができました。まずは、年金収入で老後の生活費がまかなえるかどうかがポイントです。年金受給の繰り下げなどを検討し、まずは基本生活費を年金額内に収められたら、リタイアOKのサインです。


 年金額が少なくて基本生活費がまかなえそうになければ、赤字額の総額をだしてみましょう。100歳まで生きると考えて計算すると安心です。最低でも、その金額を60歳までに預貯金で用意できなくては、60歳でリタイアは難しいでしょう。


 次に、基本生活費以外に必要になりそうなお金を把握します。リタイア後に海外旅行に行きたい、月に一度は温泉旅行に行きたいなどの基本生活費とは別の費用。マイホームのリフォーム代なども予定があれば加算します。体が不自由になったら有料老人ホームに入りたいなどの希望がある場合は、必要な金額を試算しておきます。これらの老後のイベント費用の総額をだしてみましょう。


 最後に、医療費や介護の費用も考えておかなくてはいけません。予備費も含めて1人あたり2000万円は考えておきたいところ。これらの総額が60歳までに貯めるべき金額となります。


 <h2>
 毎月の赤字、老後のイベント費用、医療介護費を60歳までに貯める！
 </h2>
 これらの老後の基本生活費の赤字分（基本生活費が年金でまかなえない場合）、老後のイベント費用、医療費介護費といった老後に必要となるお金が把握できました。60歳で仕事をリタイアしたい場合は、その金額を60歳までに用意しなくてはいけません。


 退職金などを考慮し、残りは60歳までに貯められるように計画をたてましょう。それが実行できれば、60歳でリタイアが視野に入るでしょう。今現在の生活費の把握、老後費用の設定、計画的な貯蓄計画と実行ができれば、60歳で仕事を辞めることが可能になるでしょう。


 文：福一 由紀（ファイナンシャルプランナー）


 大学卒業後システムエンジニアとして勤務。2人の子どもを出産し退職後FP資格を取得。女性のFP仲間とともに会社を設立し、セミナー、執筆、各種メディアへの企画監修、コンサルティングなどを行っている。

60歳で仕事を辞めたいならやっておくべき5つのこと

Unknown lifestyle, personal finance retirement, retirement, retirement planning, senior citizens

「FIRE」という言葉が注目されています。FIREとは、Financial Independence, Retire Earlyの略で、『経済的な自立を実現させて、仕事を早期に退職する生活スタイル』のこと。FIREに憧れるものの、いざ実行となると敷居が高いところ。それなら、60歳で仕事を辞めるのは実現できるかも……。とはいっても、誰でも60歳で仕事が辞められるものではありませ…

Retiring Abroad: Top Countries Chosen by U.S. Retirees

Unknown living abroad, pensions, retirement, retirement planning, senior citizens

Editor’s note: Subscribe now
 Unleashing the Globe: DIWIDATravel’s Weekly Newsletter
 . Stay updated with destination news along with the newest developments in aviation, cuisine, beverages, and accommodations.


 Attracted by either the pleasant weather or more affordable living costs, an increasing number of older Americans are opting to spend their retirement abroad. They believe this move could align more closely with both their financial goals and personal preferences for lifestyle.


 Although precise figures haven't been released, businesses and groups that help individuals relocate overseas have experienced a significant surge in website visits and inquiries following the election during recent months—evidence some interpret as an indication of "growing momentum" or a developing trend where numerous Americans, particularly those who are retired, are contemplating or even initiating a permanent relocation abroad.


 I don't believe it will simply disappear as it has in all prior elections I've covered," said Kathleen Peddicord, founder and publisher of Live andInvest Overseas, to DIWIDATravel. "This issue isn't likely to vanish. People are raising significant concerns comparing one country with another regarding their residency choices and potential tax obligations. These aren't idealistic queries; they're highly pragmatic.


 Founded in 2008, LIOS releases frequent articles covering topics related to living overseas, including issues like taxation and healthcare. According to Peddicord, website visits surged approximately 250% after the election, and this ongoing engagement has contributed significantly to "our most substantial increase in readership ever."


 Peddicord mentioned that around 80% of the LIOS audience consists of retirees, encompassing both those who have already retired and individuals preparing for retirement. The group releases an annual list each year.
 10 Top Locations for Retirement
 Is one of the publication’s “most-read and eagerly awaited” reports.


 International Living
 , a monthly magazine and website dedicated to life overseas, has experienced a notable rise in inquiries and web traffic. This trend began prior to the election, as reported by Executive Editor Jennifer Stevens to DIWIDATravel. The publication’s insights are supported by data analysis.
 Annual Global Retirement Index
 is influenced by elements such as accommodation, visa policies, cost of living, and healthcare, along with insights provided by over 200 local editors and correspondents.


 During the latest annual conference of the publication, held in Las Vegas in October 2024, Stevens mentioned that she had conversations with numerous readers, such as retired individuals, who expressed increasing worries regarding "the Trump policies causing discomfort for residents within the U.S." They also discussed issues like the current social climate in America and how tariff changes might affect the economy under the newly elected leadership.


 Stevens mentioned that alongside this concern, she observed an enthusiasm among people regarding possible tax cuts and increased disposable income—benefits that might extend beyond U.S. borders as well. "People are exploring methods to broaden their international investments or utilize those funds overseas," she explains.


 The scarcity of money remains a significant concern for numerous American retirees today. The rising expenses related to housing, rentals, and health care are draining their savings at a faster rate compared to earlier generations—indeed, this trend is quite pronounced.
 nearly half of American households
 do not have any savings in a retirement account.


 Meanwhile, more than
 17 million Americans
 A third of those aged 65 or older—about one in three—are deemed economically insecure, with their income levels falling at 200% or higher above the federal poverty line.


 Moving to a country with a much lower cost of living offers an opportunity to “invert your budget, so you could take what you’re currently spending on, say, transportation, and move to a place where you don’t need a car, for instance, and use that budget for discretionary spending,” Sophia Titley, LIOS editor-in-chief, tells DIWIDATravel.


 Aside from their financial situations, which typically revolve around predetermined budgets, retirees must navigate particular requirements when considering relocation overseas. Primarily, they need to determine if they are permitted—or possess the resources—to retire in their chosen country. For instance, certain nations might provide appealing job opportunities for digital nomads—but these may be less accessible for individuals who are no longer employed.


 You should focus on locations where obtaining a residency visa is feasible," Titley advises. "That seems like the most logical starting point. Assess your current situation, financial capabilities, various eligibility criteria, and consider areas that provide residency options for regular individuals.


 An important factor to consider is assessing your eligibility and understanding the expenses related to healthcare and health insurance in your new location. It’s advisable to conduct comprehensive research ahead of time since certain nations, such as Spain and France, mandate having health insurance as part of their visa approval process.


 Peddicord points out that "the positive aspect... is that regardless of where you go, healthcare will be more economical since it costs more in the United States compared to anywhere else—not just for healthcare itself, but also for health insurance."


 Ultimately, retirees enrolled in Medicare – which is a federal health insurance program designed for Americans aged 65 and above (as well as certain younger people with disabilities) – ought to ensure they thoroughly research how relocating overseas could affect their eligibility benefits.


 Medicare generally won’t cover healthcare expenses except in certain cases.
 outside of the US
 However, specialists suggest maintaining coverage if feasible, as it can provide a safeguard and a feeling of security in case of significant health issues or injuries.


 “Maintaining this option keeps things flexible,” says Peddicord. “If needed, you could return to the U.S., where you might have family and a stronger support system during such an ordeal. On the other hand, if you've surrendered your Medicare, rejoining the program isn’t always easy.”


 Although visas, taxation, and health care rank as some of the key factors when relocating overseas, retirees ought to also evaluate various destinations—along with their smaller regional areas—to ensure they match their desired way of life.


 Below are five nations ideal for retirees in 2025. (While this compilation mainly caters to American retirees, it includes useful broad details as well.)

<h3>
 Panama
</h3>
<img data-document-id="cms/api/amp/image/AA1BiVQ8" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1BiVQ8.jpg"/>

 This nation in Central America led International Living’s list.
 Annual Global Retirement Index
 As the top choice for retiring in 2025 globally, thanks to its simple visa procedures, high standard of living, and great cost-effectiveness.


 Panama offers "possibly the finest retirement visa program globally," according to Stevens. "They recognized early on that making it simple for international retirees to move there could attract them to spend their wealth within Panama’s borders. As such, obtaining and renewing a visa in Panama is straightforward, offering excellent perks for retirees."


 These perks encompass reduced rates on flights, theater tickets, and various others. The contemporary healthcare system in Panama garners acclaim as well—aside from being cost-effective for medical services, permanent residents who qualify as pensioners (age 60 for men, 55 for women) get a 20% discount on prescriptions.


 
 Key considerations:
 
 In Panama, the bar for its passive income requirement isn’t very high: you need at least a monthly income of US $1,000 from sources like a government initiative, including Social Security, or through payments from a private company. For each additional dependent, this minimum amount increases by an extra $250 every month.


 English proficiency levels
 Are quite minimal throughout the nation, making it particularly beneficial to have at least a basic understanding of Spanish.


 
 How to execute the transition:
 
 The website for the Embassy of Panama explicitly mentions in English
 on its website
 To apply for a retiree visa, often referred to as the Pensionado Visa, certain requirements must be met. Keep in mind that your application needs to be handled by a Panamanian lawyer, and you should submit it within Panama itself.

<h3>
 France
</h3>
<img data-document-id="cms/api/amp/image/AA1BiVQe" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1BiVQe.jpg"/>

 France is renowned for its exquisite cuisine, premier museums, and stunning beaches along with picturesque landscapes. However, those fondly anticipating their golden years in this cherished European nation might be particularly attracted to another significant perk: an exceptional healthcare system available to all inhabitants, which is predominantly funded by the state.


 Moreover, France’s cost of living is unexpectedly affordable for some. As reported
 Chase Buchanan’s latest data
 The rental cost for a family apartment in France can be as little as approximately $1,100 per month outside of Paris, with grocery costs, public transport, and various other expenditures being notably cheaper compared to those in the U.S.


 "Beyond Paris, there are regions in France that offer remarkably budget-friendly living costs," states Peddicord. She divides her time with her family between Paris and Panama City, often surprising others when she mentions that Paris actually turns out to be more economical than expected.


 She encourages those who aspire to spend their retirement in the City of Light not to dismiss it outright as too expensive. "Even Paris should remain on your radar, provided you invest some time into thorough investigation."


 
 Key considerations:
 
 A significant benefit for American retirees moving to France is their continued ability to contribute to tax-favored U.S. retirement plans such as 401(k)s and IRAs. This advantage is due to the bilateral tax agreement between the U.S. and France, ensuring these accounts remain unaffected.
 taxed at US rates
 For Americans residing in France, rather than possibly facing higher
 French income tax rates
 .


 Nevertheless, there is an important point regarding inheritance tax: In contrast to the US system, where taxes are levied based on the overall estate value, in France, the taxation occurs per beneficiary rather than on the entire estate sum. Additionally, due to mandatory succession laws, certain minimum shares must be allocated to designated beneficiaries—information that retirees owning substantial assets ought to keep in mind.


 France's bureaucratic system can be daunting, particularly for individuals who do not speak French. Unlike in many other European nations, English is not commonly used here, especially beyond the big urban centers.


 
 How to execute the transition:
 
 Ready to say
 oui
 for retirement in France? U.S. citizens have the option to apply for it.


 the
 Long-Stay Visa for Retirement
 (Long Stay Visa for Pensioners). For this choice, you must provide evidence of adequate financial means along with health insurance coverage. You'll submit your application for this visa at the closest French consulate within the U.S., following which you receive what is referred to as the
 carte de séjour visiteur
 (A residential visa) requires your pension to be at least $1,073 for an individual or $1,666 for a couple. This visa remains effective for one year but offers renewal options.

<h3>
 Malaysia
</h3>
<img data-document-id="cms/api/amp/image/AA1Bj4Hg" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1Bj4Hg.jpg"/>

 Malaysia, which
 ranked seventh
 In the 2025 Global Retirement Index published by International Living, it provides an "exceptionally impressive" value for money according to Stevens. This destination is ideal for people aiming to extend their financial resources, along with retirees seeking a pleasant living environment at significantly lower costs compared to what they'd incur in the U.S., as she clarifies. She further adds, "If simplicity is preferred, one could manage almost without spending anything."


 Based on information from International Living, renting a one-bedroom apartment in Kuala Lumpur typically ranges from $300 to $500 per month, with utility expenses adding approximately $40-$60 more each month. In lesser urban areas like Penang and Malacca, which are outside the main city center, you can find even better deals on rent alongside a less hectic lifestyle and active foreign resident groups.


 Malaysia's healthcare system is also top-notch, featuring state-of-the-art facilities, personnel who speak English, and provides high-quality care at reasonable costs. An additional perk for those looking to retire here: Any money you bring into the country is exempt from taxes.


 Moreover, this Southeast Asian nation serves as a vibrant blend of various cultures and culinary traditions, with English being extensively used (official signs are also displayed in English). "In certain aspects, exploring that region might be more straightforward for someone who doesn't know Spanish, compared to visiting Mexico," remarks Stevens.


 
 Key considerations:
 
 Malaysia experiences a consistently hot and wet tropical weather all year long, which might not suit individuals who enjoy experiencing different seasons. Moreover, for retirees planning regular returns to the U.S., flying out of Malaysia can be quite challenging due to lengthy flight durations exceeding 20 hours.


 
 How to make the transition:
 
 Malaysia offers various visa choices tailored particularly for retirees. The most favored one is the
 Malaysia as My Second Home (MM2H) initiative
 , providing a renewable multiple-entry visa. To be eligible, you must be at least 50 years old and satisfy certain financial criteria: deposit around $35,883 into a Malaysian bank account; global banks such as Citibank and HSBC are also acceptable for this requirement. Alternatively, you can demonstrate having a consistent monthly income of roughly $2,350 sourced from a government-issued pension.

<h3>
 Spain
</h3>

 Thanks to superb climate, top-notch healthcare, comparatively affordable living costs, and renowned cuisine, this European nation has long been a favorite destination for retirees over many years.
 InterNations' 2024 Expatriate City Rankings
 The leading positions among the 53 cities were claimed by Spanish cities (specifically Valencia, Málaga, and Alicante). In comparison, Madrid secured the seventh spot, whereas Barcelona was placed at twenty-first.


 Moreover, Spain offers a broad spectrum of choices catering to various lifestyles, ranging from the bustling center of Madrid to quaint towns scattered across the nation’s eastern Mediterranean shoreline, alongside the picturesque Basque Country on Spain’s northwestern Atlantic edge.


 
 What to consider
 
 Spain's taxation system is complex and varies between different autonomous regions. As a basic guideline, if you reside in Spain for over 183 days within a single calendar year, you are deemed a tax resident.


 Spanish proficiency ranks amongst the lowest in Europe, particularly beyond metropolitan areas such as Madrid and Barcelona. While most Spaniards speak Castilian Spanish, certain autonomous communities have their own officially recognized languages; Catalan in Catalonia being one instance, along with Basque, known locally as Euskara, which is used in the Basque region.


 Lastly, don't look for any early bird dinner discounts; Spaniards typically have their supper after 8:30 p.m.


 
 How to execute the relocation:
 
 Spain’s
 non-lucrative visa
 (NLV, also referred to as a retirement visa) is a favored option for Americans. This visa is mainly designed for individuals who have adequate passive income or financial resources so they do not rely on Spain’s social security benefits (the current requirement stands at roughly $2,600 per month for an individual applicant; each extra family member necessitates additional funding).


 You’ll apply
 through your nearest consulate
 (this refers to the procedures for the Los Angeles consulate but provides a step-by-step guide). Additionally, you must present evidence of your insurance coverage in Spain; navigating this part might be somewhat complicated since travel insurance isn’t acceptable here. Expect extensive documentation requirements and long lead times for scheduling appointments, so make sure to prepare well ahead of time.

<h3>
 Mexico
</h3>
<img data-document-id="cms/api/amp/image/AA1Bj4Hi" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1Bj4Hi.jpg"/>

 The country located south of the US frequently places highly on lists for ideal retirement destinations (in 2025, it secured the fourth spot on International Living’s Global Retirement Index). Its closeness to America, lower costs, and relaxed lifestyle make it very appealing. Additionally, Mexico provides a great choice for those considering living overseas but only seasonally.


 In the meantime, bustling English-speaking expatriate communities in most urban areas, along with numerous familiar service providers from the US such as Netflix and Amazon, assist new arrivals in adapting more smoothly.


 Mexico provides numerous tax benefits that particularly appeal to retirees. There are no taxes on inheritances or accumulated wealth, and unlike in many other nations, you achieve tax resident status based on where your main residence or principal place of business is located, rather than the aggregate number of days you spend within the nation.


 
 Key considerations:
 
 Mexico ranks among
 the least peaceful
 According to official data, these countries are located in Latin America. The statistics reveal that there were
 31,062 homicides in 2023
 , approximately 24 out of every 100,000 residents (in the U.S., this rate was around six per 100,000 individuals in 2023, as reported
 Federal Bureau of Investigation
 data).


 While cartel-related violence and drug trafficking dominate headlines in Mexico, petty crimes like theft and pickpocketing are actually the issues most frequently brought up by people.


 Moreover, similar to what occurs in several other nations such as Portugal, an increase in foreign residents along with growing gentrification in particular urban areas has ignited debate and concern.
 growing tensions
 In certain regions that have substantial expatriate communities.


 
 How to go about making the move:
 
 Individuals with valid passports from nations that do not need a visa, such as those from the United States, may stay in Mexico for up to 180 days. However, they are required to obtain a visitor’s permit, also known as an fmm.
 Forma Migratoria Multiple
 (FMM) upon arrival at their point of entry. Remember that the precise number of days permitted is still determined by the immigration officer who processes them.)


 For extended visits, retirees might consider looking into visa options.
 temporary
 and
 permanent residents
 . They are both quite simple; however, candidates need to show they have financial stability.


 To get additional DIWIDA news and newsletters, sign up for an account there.
 DIWIDA

Retiring Abroad: Top Countries Chosen by U.S. Retirees

Unknown living abroad, pensions, retirement, retirement planning, senior citizens

Editor’s note: Subscribe now Unleashing the Globe: DIWIDATravel’s Weekly Newsletter . Stay updated with destination news along with the newest developments in aviation, cuisine, beverages, and acc…

How Many Americans Really Retire With $1 Million?

Unknown economics, money, personal finance retirement, retirement, retirement planning

Aiming to retire with $1 million is a significant aspiration for numerous individuals. Even though the cost of living has increased in recent times, $1 million remains a substantial sum that can provide a comfortable lifestyle during one’s retirement years when combined with other resources.
 Social Security
 .


 As achieving millionaire status becomes more commonplace, it remains an accomplishment that eludes most individuals until they reach retirement age. However, with proper planning, steadfast consistency, and maybe a bit of good fortune, you can position yourself to become part of the exclusive group known as the "two-comma club."


 
 Start Your Mornings Smarter!
 
 Wake up with
 
 Breakfast news
 
 In your inbox each trading day.
 
 
 Register Now for Free »
 
 


 This is how many individuals manage to reach retirement age with $1 million.

<div class="image">
 <img data-document-id="cms/api/amp/image/AA1B8XSs" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1B8XSs.jpg"/>
</div>
<h2>
 Pensioning off as a millionaire isn't overly rare, yet still quite uncommon.
</h2>

 The most reliable data we have to assess the number of Americans with a net worth of $1 million or higher originates from the
 Federal Reserve
 Every three years, the Federal Reserve carries out a Survey of Consumer Finances, which gathers crucial demographic information and delves deep into individuals' finances from American citizens. The latest iteration of this survey was conducted in 2022. We will not receive the findings for the 2025 survey for roughly another one and a half years; thus, at present, these are our most current figures available.


 Approximately 18% of U.S. households boasted a net worth of at least $1 million in 2022, based on available statistics. However, this figure encompasses household units spanning from 18 to 95 years old.


 When examining households with the primary breadwinner aged between 50 and 64 years old—right around the typical retirement age—one in every four can be considered millionaires. This equates to approximately 16.3 million people in the U.S.


 Certainly, some individuals do achieve millionaire status long before they reach their retirement years. However, the proportion of people attaining such significant wealth by age 50 is considerably smaller.


 It’s important to observe that the number of millionaires stays notably consistent among those who have surpassed retirement age. This could indicate various benefits that older generations enjoy when building wealth, including reduced costs related to education and housing. However, this stability might also highlight the effectiveness of amassing and maintaining assets that increase in value gradually, such as shares.


 Actually, that's the simplest method for you to become part of the community of millionaire retirees.

<h2>
 The straightforward way to retire as a millionaire
</h2>

 About one-fourth of U.S. families manage to amass a net worth of $1 million by retirement age, which might encourage you to believe that achieving this benchmark is also within your grasp. Becoming a millionaire isn’t typically due to random chance; though fortune may play a role, it’s more often the result of persistent saving and investing that allows individuals to secure the financial stability required for a comfortable retirement.


 There are many easy opportunities that can assist you in becoming a millionaire when you retire.


 Initially, focus on clearing any high-interest debts like credit cards or personal loans because these take precedence over everything else. Few investment opportunities can match the returns of eliminating debt with an annual interest rate of 30%.


 If your boss provides a
 matching 401(k) contribution
 , that should be the first place you start saving for retirement. Even if the investment options in your workplace retirement plan aren't great and the fees are high, it's probably worth securing the match.


 If your employer does not provide a retirement plan with a matching contribution, look into utilizing any available tax-advantaged retirement accounts.
 IRA or Roth IRA
 It's an excellent choice for saving towards retirement since you won’t incur any taxes.
 taxes on capital gains
 or dividends in your account. This could lead to a significantly larger savings pot when you retire.


 When selecting where to invest, you have numerous choices. Investing in specific stocks might appeal to you as you spot chances within the market. However, should you lack the time for thorough company analysis and stock valuation, opting for a low-cost diversified fund would be wise.
 index fund
 such as the
 
 Vanguard S&P 500 ETF
 
 
 (NYSEMKT: VOO)
 
 The fund follows the index of
 
 S&P 500
 
 index, commonly employed as a standard reference
 large-cap U.S. stocks
 It levies only 0.03% of your total assets to offer a well-diversified mix that mirrors the performance of the benchmark index.


 Despite the benefits that senior citizens might have enjoyed with regard to expenses such as college tuition or property purchases, young individuals possess a significant edge in the realm of investment: time. This factor stands out as an incredibly potent element within financial planning. The extended duration for which you permit your capital to accumulate interest leads to substantial growth. Regularly setting aside funds and channeling them into investments across years has the potential to transform one into a millionaire.


 Even if you find yourself pushing forty or fifty, becoming a millionaire at retirement isn’t out of reach. It will require ramping up your saving efforts and sticking steadfastly to your strategy. Achieving this milestone doesn’t need to remain an unattainable fantasy; countless Americans can confirm otherwise.

<h2>
 The $
 
 22,924
 
 The Social Security benefit many seniors fail to notice.
</h2>

 If you’re similar to many Americans, you might be lagging several years—or even more—behind on saving for retirement. However, some lesser-known “Social Security strategies” may assist in increasing your retirement earnings. For instance: one simple tactic could provide an additional $
 
 22,924
 
 More every year! After mastering strategies to optimize your Social Security benefits, we believe you can retire with confidence and achieve the peace of mind everyone seeks.
 Just click here to find out how you can learn more about these tactics.


 
 Check out the "Social Security Secrets" »
 


 Adam Levy
 has no holdings in any of the aforementioned stocks. The Motley Fool holds positions in and advocates for investing in the Vanguard S&P 500 ETF. The organization also has a
 disclosure policy
 .

How Many Americans Really Retire With $1 Million?

Unknown economics, money, personal finance retirement, retirement, retirement planning

Aiming to retire with $1 million is a significant aspiration for numerous individuals. Even though the cost of living has increased in recent times, $1 million remains a substantial sum that can pro…

Study shows how long Social Security, $1.5M nest egg would last in 50 states

Unknown money, personal finance retirement, retirement, retirement planning, social security

<img data-document-id="cms/api/amp/video/AA1zTQNl" data-reference="video"/>
 
 Retirement nest eggs and Social Security benefits are key sources of funds for many Americans as they live out their golden years in the state of their choosing.
 
 
 A recently-released study
 from GOBankingRates
 looked at the financial runway that retirees would have in each state with Social Security benefits and $1.5 million socked away for retirement, finding West Virginia offered the most years before living costs would deplete their retirement savings.
 
 
 The Mountain State ranked No. 1 with $1.5 million in retirement savings expected to sustain retirees there for a whopping 54 years while facing about $27,800 in living costs each year after
 Social Security benefits
 , according to the study.
 
 
 The Social Security Administration (SSA) allows Americans to access their Social Security retirement benefits early starting at age 62, though payments "will be reduced a small percentage for each month before your full retirement age" if they do that, according to the SSA. One’s "full retirement age" depends on when a person was born.
 
 
 
 SOCIAL SECURITY PAYMENTS TO INCREASE FOR PUBLIC PENSION RECIPIENTS
 
 
 
 GOBankingRates said it used data from a slew of sources, including the Bureau of Labor Statistics, the SSA and Missouri Economic Research and Information Center, to determine its rankings of how states stack up in terms of the amount of time that Social Security and $1.5 million in retirement would last
 retirees
 residing in them.
 
 
 
 READ ON THE FOX BUSINESS APP
 
 
 
 Overall, the study indicated that those two sources of funds would provide different amounts of years of "financial security"
 for retirees
 in states across the country. States’ cost of living after Social Security ranged from $27,803 to $87,770 per year, it found.
 
 
 
 401(K) BALANCES HIT SECOND HIGHEST ON RECORD: FIDELITY
 
 
 
 GoBankingRates found the number of years that $1.5 million and Social Security
 would sustain
 retirees in each state was:
 
 <img data-document-id="cms/api/amp/image/BB1nwSZl" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/BB1nwSZl.jpg"/>
 <img data-document-id="cms/api/amp/image/BB1nJxXh" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/BB1nJxXh.jpg"/>
 <img data-document-id="cms/api/amp/image/AA1B6J6S" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1B6J6S.jpg"/>
 <img data-document-id="cms/api/amp/image/AA1ujvfk" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1ujvfk.jpg"/>
 
 
 THIS MIDWESTERN STATE IS CONSIDERED ONE OF THE BEST PLACES TO RETIRE, NEW STUDY SAYS: SEE THE LIST
 
 


 
 
 Original article source:
 
 Study shows how long Social Security, $1.5M nest egg would last in 50 states

Study shows how long Social Security, $1.5M nest egg would last in 50 states

Unknown money, personal finance retirement, retirement, retirement planning, social security

Retirement nest eggs and Social Security benefits are key sources of funds for many Americans as they live out their golden years in the state of their choosing. A recently-released study…

Here’s how a 40-year-old could start investing £100 per week to retire early

Unknown investing, investing economy, investors, personal finance retirement, retirement planning

<img data-document-id="cms/api/amp/image/AA13PhLc" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA13PhLc.jpg"/>

 Retirement can seem a long way off for many people. A financially savvy worker can turn that long-term timeframe to their advantage and start investing sooner rather than later to help fund their retirement.


 For example, if a 40-year-old started today by investing £100 each week in carefully chosen blue-chip shares, I reckon they could grow their wealth and potentially
 retire early
 .

<h2 class="wp-block-heading" id="h-regular-saving-can-help-build-a-sizeable-retirement-fund">
 Regular saving can help build a sizeable retirement fund
</h2>

 Of course, starting at 30 would be even better than starting at 40 – and at 20 would be even better than at 30!


 Unfortunately, though, many of us do not realise that (or have other spending priorities) until it is too late. Even at 40, fortunately, an investor could still make a big difference to their retirement fund if they start investing immediately.


 Putting £100 per week into a
 Stocks and Shares ISA
 or
 SIPP
 and compounding it at 10% annually, after 25 years the investor will have a retirement fund of close to £535k.


 That could help them draw an income (for example, via dividends) and
 retire earlier than otherwise
 .

<h2 class="wp-block-heading" id="h-building-a-quality-portfolio-of-great-shares">
 Building a quality portfolio of great shares
</h2>

 A goal of 10% might not sound too challenging. After all, FTSE 100 insurer
 
 Phoenix
 
 
 Group
 
 (
 LSE: PHNX
 ) currently offers a dividend yield of 10.2% and has been a consistent dividend raiser in recent years. Some other blue-chip shares also offer high yields.


 But there are several things to bear in mind. That compound annual growth rate includes good years as well as bad. It also includes capital gain (or loss), as well as dividends.


 Phoenix has a generous dividend yield, but its share price has fallen 11% in the past five years.


 On top of that, it is always important to diversify across different shares in case one of them disappoints. Over the decades between age 40 and retirement, that is much more likely to happen than it may seem to an investor when they first start investing!


 But with the
 right approach
 and
 investing mindset
 , I think a 10% compound annual growth rate could be achievable.

<h2 class="wp-block-heading" id="h-one-share-to-consider">
 One share to consider
</h2>

 In fact, I do still think Phoenix is a share to consider for its long-term potential.


 The insurance sector is extensive and doesn’t seem poised for significant shrinkage anytime soon, as far as I can tell. Given its approximately 12 million clients and near £300 billion in volume, Phoenix operates a massive enterprise capable of producing substantial surplus funds. This financial cushion is beneficial when supporting sizeable dividend payouts.


 All stocks come with risks, including Phoenix. One aspect is their portfolio of mortgages, which relies on specific valuation assumptions. Should a downturn in the property market lead to significant drops in prices, these assumptions might prove insufficient. This could force Phoenix to reassess the value of its mortgage book, potentially reducing profit margins.


 Looking ahead over the longer term, however, I believe the established enterprise still holds considerable promise.


 The post
 For someone who is 40 years old aiming to retire early, here’s how they might begin by investing £100 each week.
 appeared first on
 The Motley Fool UK
 .

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Here’s how a 40-year-old could start investing £100 per week to retire early

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Retirement can seem a long way off for many people. A financially savvy worker can turn that long-term timeframe to their advantage and start investing sooner rather than later to help fund their re…

4 Key Social Security Rule Updates Coming in April 2025

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If you receive Social Security benefits, you have probably adjusted to your updated payments over the past few months due to the 2.5% cost-of-living adjustment (COLA) implemented in January. Typically, your benefit amount wouldn’t change for the remainder of the year. However, 2025 is turning out to be far from typical when it comes to Social Security.


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<h2>
 1. Increased benefits for countless seniors impacted by the Social Security Fairness Act
</h2>

 President Biden signed the
 Social Security Fairness Act
 During his last days in office, he eliminated two clauses that decreased benefits for retirees receiving pensions from non-Social Security-covered employers, impacting numerous firefighters, police officers, and teachers.


 Around 3.2 million recipients are impacted by this alteration in the rules, encompassing certain widows and widowers.
 spousal beneficiaries
 The legislation affects all benefits paid out after December 2023. Numerous qualifying elderly individuals were issued a single retroactive payment in March, which covered the outstanding benefits owed to them.


 Retirees who are impacted will experience a permanent boost in their monthly benefits as well. This change will mostly take effect with the April 2025 payment. Based on estimates from the Congressional Budget Office, the typical retired worker can expect an additional $360 each month. Meanwhile, spousal recipients will likely see an extra $700 per month, and those eligible widows or widowers should anticipate an average increase of approximately $1,190 every month.


 Nevertheless, certain intricate cases have remained beyond the capabilities of automation within the Social Security Administration. Should your situation fall into one of these categories, it might take up to a year to obtain the funds due to you under the Social Security Fairness Act. If you think this legislation impacts you and your payments in April 2025 mirror those from March, contact the Social Security Administration for further details.

<h2>
 2. Stricter identity confirmation regulations
</h2>

 Starting from April 14, 2025, the Social Security Administration will implement stricter identity verification processes aimed at enhancing protection of Social Security records and benefits from fraudulent activities. Individuals utilizing their
 my Social Security account
 To make alterations such as updating your address or changing your direct deposit information will go unnoticed.


 However, individuals who opt to submit their applications for benefits or modify them through alternative means will be required to go to a Social Security office personally. The only exceptions are people who are applying for Medicare, disability benefits, or Supplemental Security Income (SSI).


 With the updated regulations, you can start your Social Security application via telephone should you choose to do so. However, finishing the process requires visiting a local Social Security office in person to show your ID for verification purposes.


 The Social Security Administration offers an online resource that can assist you.
 find your closest field office
 This could perhaps benefit from a second look, despite your prior visits to a nearby Social Security office. Many governmental offices have shut down this year, which means the location you used to go to might now be inaccessible.


 If visiting in person isn’t preferable for you, think about setting up a My Social Security account if you haven’t done so yet. Initially, when establishing your profile, you will need to respond to several identity verification queries to confirm your authenticity. However, after completing these steps, you can access your information using just a username and password whenever updates are needed.

<h2>
 3. Accelerated implementation of direct deposit updates
</h2>

 Previously, altering the bank account where the Social Security Administration deposited your benefits took around 30 days. From now on, this process will be completed within just one business day.


 You have the option to update your direct deposit details through your My Social Security account. Alternatively, if you prefer not to make changes online, you can call them to request the modification up until April 14, 2025.

<h2>
 4. Go back to achieving a full 100% recovery rate for overpayments.
</h2>

 Occasionally, the Social Security Administration may make an error leading to excess payments to recipients. In such cases, they have the right to reclaim these funds through subsequent disbursements. However, under the Biden Administration’s guidelines implemented for 2024, the repayment rate has been limited to whichever is higher: either $10 or 10 percent of each payment received.


 If your typical monthly Social Security benefits amount to $2,000 but one month you receive $3,000, the Social Security Administration might deduct $100 from subsequent payments—so you would only get $1,900 per month—until they have recovered the excess $1,000.


 The administration under President Trump has restored the full overpayment recovery rate of 100%, which was applicable before 2024. This change impacts all fresh overpayments made starting from March 27, 2025. For those who incurred overpayments earlier than this date, the previous limit of a 10% recovery rate remains unchanged. Additionally, Supplemental Security Income (SSI) continues to enforce an overpayment recovery rate capped at 10%.


 This alteration implies that you might not receive any funds from Social Security for a period if you received excess payments previously. For retired individuals, this could pose challenges; some may have already used up the additional amount assuming there was no mistake.


 If losing your Social Security benefits due to overpayment recovery is not an option for you, reach out to your nearest Social Security office to ask for a reduced repayment rate. Additionally,
 appeal the overpayment decision
 The Social Security Administration might choose to exempt you from repaying an overpayment, letting you retain the additional funds, provided you demonstrate that the error leading to the overpayment wasn’t due to your actions and that you lack the financial means to repay it.


 Should you have any queries regarding these Social Security updates, it's advisable to reach out to the Social Security Administration directly.

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4 Key Social Security Rule Updates Coming in April 2025

Unknown economics, retirement, retirement planning, social security, social welfare

If you receive Social Security benefits, you have probably adjusted to your updated payments over the past few months due to the 2.5% cost-of-living adjustment (COLA) implemented in January. Typical…

Discover 9 Clever Ways to Withdraw Retirement Funds

Unknown 401 retirement plans, personal finance, personal finance retirement, retirement, retirement planning

<img data-document-id="cms/api/amp/image/AA1zeGkW" data-reference="image" src="https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1zeGkW.jpg"/>

 If you find saving for retirement complex, imagine the challenge of withdrawing those funds efficiently to keep your tax bill as low as possible.


 As high as 70 percent of your hard-won retirement savings could vanish due to income, estate, and state taxes," asserts IRA expert Ed Slott, who authored "Fund Your Future: A Tax-Efficient Saving Strategy for Your Twenties and Thirties" and "The Retirement Savings Time Bomb Tick-Tocks Loudly.


 That’s cash that many individuals would rather hold onto personally. Yet, what steps can actually make this possible? Below are nine effective withdrawal methods designed to assist you in sidestepping expensive tax pitfalls and retaining greater portions of your retirement savings.

<h2>
 1. Adhere to the guidelines for Required Minimum Distributions (RMDs)
</h2>

 RMD stands for
 required minimum distribution
 , and once you reach the age of 73, you'll be required to begin withdrawing a minimum sum from various retirement accounts like a traditional IRA or
 401(k) plans
 .


 You are required to make Required Minimum Distributions (RMDs) every year by April 1 from the year following when you reach age 73, and by December 31 for each year thereafter. To put it another way, if you become 73 in 2024, you must withdraw your initial RMD by April 1, 2025.


 As the legislation was enacted,
 SECURE Act 2.0
 In late 2022, the required minimum distribution (RMD) starting age was raised from 72 to 73 in 2023. On January 1, 2033, this age will increase once more to 75.


 The consequence of not adhering to the guidelines is significant. Missing the deadline for Required Minimum Distributions (RMDs) incurs a substantial 25 percent excise tax. Should you fail to withdraw your RMD from an account,
 IRA
 Correct the error swiftly and resubmit your tax forms—the penalty might be decreased to 10 percent.


 If you come up short with your required minimum distribution (RMD), penalties can still be applied. For instance, if your RMD for the year should have been $20,000 but due to an error you only withdrew $5,000, the Internal Revenue Service (IRS) would impose a 25% penalty. This means they could charge you $3,750, which represents one-fourth of the missing $15,000 withdrawal amount.


 When calculating your Required Minimum Distribution (RMD), keep in mind that it can vary each year. This fluctuation depends on factors such as your current age, estimated lifespan (a longer expected lifetime means a smaller withdrawal amount), and the total account balance, which should reflect the fair market value of the assets held within your accounts as of December 31st of the previous year prior to taking the distribution.


 Take a look at the "Uniform Life Table" in
 IRS Publication 590-B
 To assist in determining how much you need to withdraw from your account.
 financial advisor
 Can also assist you in making optimal choices when it comes to taking withdrawals from your retirement accounts.

<h2>
 2. Remove funds from accounts in the proper sequence
</h2>

 If your retirement savings are necessary for getting by and you're considering withdrawing funds from an IRA, 401(k), or another account, here’s what you should know.
 Roth account
 , resist the urge for immediate satisfaction. While withdrawing from a Roth IRA is tax-free, you could end up losing out due to missed opportunities.


 Rather than doing otherwise, opt to withdrawal funds initially from your taxable retirement accounts and proceed accordingly.
 Roth IRAs
 by oneself for as much time as feasible.


 Doubtful? Think about this scenario: A 73-year-old individual decides to withdraw $18,000 from a conventional IRA and finds themselves in the 24% tax bracket. This means they will end up paying $4,320 in taxes. However, withdrawing the identical sum from a Roth IRA wouldn’t result in any tax payment at all. Now imagine further—should this person avoid Required Minimum Distributions (RMDs) from their Roth IRA and achieve a yearly return of 7%, after ten more years, the total value could reach approximately $35,409. Importantly, these gains remain untaxed upon withdrawal either by them directly or through inheritance by beneficiaries.

<h2>
 3. Understand the process of taking distributions
</h2>

 If you've accumulated multiple retirement accounts due to changing jobs frequently and you're nearing retirement, you'll need to determine how to access these funds. You might not necessarily have to draw from all of them.


 Do you have to check all of your accounts? Likely not.


 If you have several conventional IRAs, you're able to make withdrawals from each individually. However, a potentially smarter strategy might involve consolidating the assets across all your accounts into a single IRA before making just one withdrawal.


 Combining IRAs into one account might streamline documentation, facilitate the calculation of upcoming distributions, and provide more control over your finances.
 asset allocation
 , Slott says.


 However, you cannot use IRA withdrawals to fulfill your required minimum distribution (RMD) obligations for a 403(b), 401(k), or any other similar plan.


 It's important to remember that 401(k) plans cannot be combined to calculate one single required minimum distribution, according to George Jones, a senior tax analyst and managing editor at Wolters Kluwer Tax & Accounting. Consolidating these plans into an IRA can simplify this process.

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<h2>
 4. Grasp the regulations concerning Required Minimum Distributions for spouses
</h2>

 Should you find yourself with a much younger partner likely to inherit your IRA, you might be able to decrease your mandatory withdrawals. This could lead to lower tax liabilities and ensure your retirement savings stretch further over time.


 Keep in mind that Required Minimum Distributions (RMDs) are figured out with elements such as your expected lifespan according to the Internal Revenue Service (IRS). However, should you have designated an individual spouse as the exclusive recipient of your Individual Retirement Account (IRA), and this spouse is more than ten years your junior, the calculation for your RMD would be based on a joint-life expectancy chart instead. This adjustment can lessen the sum you must withdraw each year.


 For instance, consider an individual retiring at age 73 this year, who must begin taking required minimum distributions (RMDs) by April 1st of the subsequent year. According to the Internal Revenue Service (IRS), such a person has a projected lifespan of 26.5 years from now. If their Individual Retirement Account (IRA) holds $200,000, then their initial RMD for that period would amount to $7,547.17—calculated as $200,000 divided by 26.5.


 However, suppose this individual appoints their 56-year-old spouse as the exclusive beneficiary for the retirement account. Then, their combined life expectancy would amount to 31.7 years. Consequently, the initial Required Minimum Distribution (RMD) would be reduced to $6,309. The Internal Revenue Service (IRS) outlines this procedure.
 A table for this scenario can be found in Publication 590-B.
 .

<h2>
 5. Donate to charity
</h2>

 Do you have a meaningful cause you wish to contribute to? If one of your long-term financial goals involves supporting a charitable organization, consider utilizing your retirement resources to create an impact.


 This legislation permits people who are 70 years old and six months or older to make tax-free contributions, referred to as
 qualified charitable distributions
 Up to $100,000 per year can be donated directly from an IRA to a charitable organization as part of the required minimum distribution. This donation does not get counted as taxable income, thus lowering the donor’s potential income tax burden. Additionally, if you submit a joint tax return with your spouse, they too may contribute up to $100,000 yearly under this provision.


 However, keep in mind that those making tax-free charitable distributions from their IRAs will not be eligible to claim these contributions as a deductible itemization.


 “Either one of these options applies,” explains Slott. “Those who adopt this approach will incur lower tax liabilities; therefore, for those with charitable inclinations, it represents the optimal method for making contributions.”

<h2>
 6. Take "in-kind" withdrawals that count as required minimum distributions (RMDs)
</h2>

 If selling your assets isn't appealing, opting for cash withdrawals might seem simpler, yet it's not mandatory—or necessarily advisable. Instead, consider what are known as in-kind distributions, which involve withdrawing stocks or bonds directly. This approach could be preferable for those aiming to retain their holdings for different purposes. Essentially, these assets would shift from your IRA to a taxable account. On the day of transfer, these in-kind withdrawals will be evaluated based on their current fair market value.


 Withdrawing assets directly might be simpler and more cost-effective compared to selling the investments within your IRA and then repurchasing them in another investment account, which could incur additional penalties or charges.

<h2>
 7. Consider delaying RMDs
</h2>

 Delaying your retirement? If you're still employed at 73 and contributing to a 401(k) or 403(b), you might be exempt from Required Minimum Distributions (RMDs)—provided you don't hold more than 5% of the business and your retirement plan allows this exception. Under such circumstances, you can postpone RMDs until April 1 following the year you retire. At that point, you will begin withdrawing funds.


 This holds true as long as you're employed at any point during the year. Therefore, if you're 73½ years old and considering retirement before the end of the year, think again unless you wish to take an early distribution. Should you continue working past January 1st—even for just a single day—it will delay your requirement to withdraw the initial RMD by another year.


 Remember that the delay applies only to your current employer’s 401(k) plan. However, if you have 401(k) accounts from former employers and you're 73 years old or more, you will be required to withdraw funds from those accounts.

<h2>
 8. Think about doing a Roth conversion
</h2>

 Tax experts and retirement consultants frequently encourage their clients to transfer retirement accounts into Roth IRAs.
 Roth conversion
 — where time and tax-free growth can work their magic. However, it isn’t a cure-all solution, and this step might not be beneficial for every worker.


 Converting a conventional 401(k) or traditional IRA into a Roth IRA usually leads to a taxable event. Nonetheless, after completing this transfer, any growth within these accounts occurs without taxes, and they won’t be touched again as long as certain conditions are met.


 Suppose a 43-year-old individual secures a new position and opts to transfer $150,000 from their 401(k) to a Roth IRA. Given that this person falls within the 35% federal income tax bracket, they will face a tax liability of $52,500, ideally settled using external funds rather than those inside the IRA. Assuming the full sum in the Roth account experiences steady growth at an annual rate of 7%, after three decades, it could amass to approximately $1.14 million.


 For individuals nearing retirement or those required to take Required Minimum Distributions (RMDs), if you intend to use these retirement funds personally rather than leaving them to beneficiaries, it might be prudent to keep them invested as they are.


 “However, if your aim is to safeguard that retirement asset for beneficiaries,” Slott explains, “this is an excellent strategy as it eliminates the doubt around future tax rates. Switching to a Roth IRA is highly beneficial for the coming generations.”

<h2>
 9. Perform a Roth conversion when you're in your "semi-retirement" phase.
</h2>

 When your career is coming to an end and you're making less money, it might become essential to withdraw funds from your retirement account. Provided you are at least 59½ years of age, you can make withdrawals from your retirement plans without facing penalties.
 A 10% penalty for withdrawing funds prematurely
 .


 This could also be a good opportunity to transfer part of your traditional IRA to a Roth IRA—particularly if you anticipate your tax bracket will increase once you reach age 73 and must start withdrawing minimum distributions. Adopting this approach might allow you to delay claiming Social Security benefits until a future date when doing so would be more advantageous.
 benefits will be bigger
 .


 Go over it with your financial advisor to determine if this is suitable for your circumstances.

<h2>
 Bottom line
</h2>

 Using some skilled maneuvers and understanding how to withdraw funds from your retirement accounts can help reduce the impact of taxes. However, this is a complicated issue.
 finding a financial advisor
 Who will act in your best interests to assist you through this process may prove invaluable many times over.
 Here’s how you can locate an exceptional advisor.


 Editorial Disclaimer: It is recommended that all investors perform their own thorough research into investment strategies prior to making an investment choice. Additionally, it should be noted that previous performance of investment products does not ensure future growth in value.

Discover 9 Clever Ways to Withdraw Retirement Funds

Unknown 401 retirement plans, personal finance, personal finance retirement, retirement, retirement planning

If you find saving for retirement complex, imagine the challenge of withdrawing those funds efficiently to keep your tax bill as low as possible. As high as 70 percent of your hard-won retirement s…