Key Points It's important to know how Social Security spousal benefits work. The timing of your claim may depend on what your spouse does. There's only so much money a spousal benefit will pay you, and you can't double dip. The $23,760 Social Security bonus most retirees completely overlook › Most people earn their Social Security benefits in retirement by working for a good number of years and paying into the system. Specifically, you need to accumulate 40 work credits to qualify for Social Secu ...

A Roth conversion is the process of rolling over retirement funds invested in a pretax account, like a regular IRA or 401(k), into an after-tax Roth IRA. You’ll pay capital gains taxes at the time of rollover, but you won’t pay taxes in retirement when it’s time to withdraw from the Roth. Read Next: This ‘Boring’ Investment Could Be the Secret To Never Running Out of Retirement Income Check Out: 5 Clever Ways Retirees Are Earning Up To $1K Per Month From Home While a conversion can be the right thing for ...

Core Insights - Many retirees may consider returning to work for various reasons, including financial benefits, social interaction, and alleviating boredom [1] Group 1: Financial Benefits - The median retirement plan balance for Americans aged 65 to 74 was $200,000 as of 2022, which may not be sufficient for a comfortable retirement, making work a viable option to increase income [3] - Working can provide additional income to cover expenses and enhance spending power, especially if retirement savings are inadequate [4] Group 2: Social Interaction - Employment can serve as a significant source of social interaction, which many retirees may miss after leaving the workforce [5] - For those without a strong social network, part-time work can help mitigate feelings of loneliness [6] Group 3: Alleviating Boredom - Transitioning from a full-time job to retirement can lead to excessive downtime, and returning to work can help fill that void [7] - Engaging in work, even on a freelance basis, can provide a fulfilling way to stay busy and avoid restlessness [9] Group 4: Considerations Regarding Social Security - While working can enhance income, retirees on Social Security must be cautious, as earnings may affect benefits if they have not reached full retirement age [10]

Group 1 - The article emphasizes the importance of annuities as a stable and predictable investment option for retirement savings, contrasting them with more glamorous investment choices [1][2][3] - Annuities are often misunderstood due to their complexity and perceived high costs, which can intimidate potential investors [4][5] - The structure of annuities allows for lifetime income, addressing the critical need for stable income during retirement and eliminating longevity risk [6][7] Group 2 - Annuities can provide protection of principal, investment returns, or income payouts, making them a valuable addition to an investment portfolio when properly understood [5] - The potential for annuities to offer floor and capped returns linked to market indices, such as the S&P 500, provides a safety net against market losses while allowing for growth [7]

Core Insights - Financial expert Suze Orman advocates for a strategic shift towards dividend-paying stocks over traditional Treasury bonds, potentially increasing after-tax income by over 30% for retirees [2][3]. Investment Analysis - Orman's analysis shows that a hypothetical $100,000 investment in seven selected dividend-paying stocks could yield $4,304 in after-tax income annually, compared to $3,268 from a 10-year Treasury bond at 4.3%, resulting in an additional $10,360 over ten years [3]. - The favorable tax treatment of qualified dividends, taxed at capital gains rates rather than ordinary income rates, contributes to the higher after-tax income from dividend stocks [4]. Stock Recommendations - Orman recommends seven dividend-paying stocks with yields of 3.9% or higher: AbbVie (ABBV), AT&T (T), Prudential Financial (PRU), Fifth Third Bancorp (FITB), Sanofi (SNY), Williams Companies (WMB), and Amcor (AMCR), which average a 5.69% annual dividend yield [5]. - Emphasis is placed on conducting due diligence to ensure companies have sufficient free cash flow to support their dividends [6]. Risk Management - Orman addresses concerns about dividend cuts, arguing that dividend-paying stocks provide income during market downturns, unlike Treasury bonds that lock in rates [7]. - Quality dividend stocks often increase their payouts annually, providing a safety factor for investors [7]. Investment Strategy - Orman suggests a balanced investment approach, maintaining exposure to technology and growth stocks while using dividend stocks for income generation [8]. - For retirees, she recommends dollar-cost averaging and consulting financial professionals, cautioning against chasing excessively high yields [9].

The federal government and some states tax Social Security. But even if you live in a state that doesn’t tax your benefits, you should still have a financial and tax plan that maximizes your retirement income. https://t.co/86QqZoyBSn ...

Annuity Basics - Annuities are tools to help generate retirement income [1] - The industry offers fixed, variable, indexed, immediate, and deferred annuities [1]

Core Insights - Many retirees are seeking multiple sources of passive income to supplement their retirement savings, especially when living on a fixed income [1][2] Guaranteed Income Streams - Annuities are highlighted as a viable option for retirees to secure guaranteed passive income, with higher interest rates from multiyear guaranteed annuities enhancing retirement savings [3] - Dividend-paying stocks from established blue-chip corporations provide recurring payouts, although investors must be cautious of rate changes and potential suspended payments during economic downturns [3] Investment Funds - Mutual funds and exchange-traded funds (ETFs) can also generate dividends and distribution income, offering another passive cash flow source for retirees, provided they manage risk levels appropriately [4] Real Estate Investments - Real estate remains a traditional passive income generator, with the potential for rental income from unused properties, which can significantly enhance a retiree's income stream [5]

Core Insights - Workplace plan sponsors are evolving from merely overseeing 401(k) accounts to becoming full-service financial planning resources for employees, which could significantly impact the wealth management industry [1] Group 1: Plan Sponsors' Concerns and Actions - A survey of 1,144 plan sponsors indicates their primary concern is ensuring that their plans adequately prepare participants for financial security in retirement [2] - 92% of plan sponsors report collaborating with an advisor or consultant, although this role was previously limited to fiduciary responsibilities and investment recommendations [3] - 93% of plan sponsors now offer financial wellness programs, with over half implementing these programs within the last year [4] Group 2: Role of Advisors - Advisors are becoming essential resources as plan sponsors seek more engagement to enhance participant saving and engagement through financial planning and wellness programs [5] - The nature of expanded education provided by advisors varies across different plans, reflecting the unique needs of each sponsor [5] Group 3: Successful Offerings and Education - Successful offerings for plan sponsors include lunch webinar series on financial planning and dedicated sessions for individual participant questions, covering topics like cash flow, saving strategies, estate planning, tax planning, and retirement income [6] - There is a recognition that without proper education, participants may not fully maximize their benefits for their future [7]

Core Insights - Social Security benefits serve as a crucial source of guaranteed lifetime income for seniors, protected against inflation and providing financial support until death [1] - Many seniors make mistakes regarding their Social Security benefits, which can lead to significant financial losses [2] Group 1: Common Mistakes - Not coordinating with a spouse before claiming Social Security can lead to regrettable decisions, as couples can employ strategies to maximize combined lifetime benefits [4][6] - Failing to perform a break-even calculation is another critical error, as it helps determine the optimal time to claim Social Security benefits [7] Group 2: Financial Implications - Claiming benefits early can significantly reduce monthly payments; for instance, a standard benefit of $2,000 per month could decrease to $1,400 if claimed at age 62 instead of waiting until the Full Retirement Age of 67 [9]