A digest of timely information and insight about finance, investing, and retirement.
This may be one of the best things about turning 50 | MarketWatch
If you are age 50 or older, you can make extra “catch-up” contributions to certain types of tax-favored retirement accounts. There’s still time to make an extra catch-up contribution to your IRA for the 2015 tax year. The deadline is April 18.
Once you’ve reached age 50, you can make catch-up contributions to your traditional IRA or Roth IRA. And if you were 50 or older as of Dec. 31, 2015, you can still make a catch-up contribution for the 2015 tax year. If your employer allows them, you can also make extra salary-reduction contributions of up to $6,000 to your 401(k), 403(b), or 457 account.
Fewer of us save, more are confident of retirement. Are we crazy? | Bloomberg
The retirement confidence of Americans has come a long way since the recession. But it isn’t because of a surge in the number of people who are saving, according to the Retirement Confidence Survey released by the Employee Benefit Research Institute. The percentage of workers saying they or their spouse saved for retirement is 69 percent in 2016. And only 48 percent of workers have even tried to figure out how much money they’ll need to live on in retirement.
Workers with a retirement plan contributed the most to the higher overall confidence numbers. Many of the “very confident” have, or have a spouse who has, a defined contribution plan, an IRA or a defined benefit plan from a current or previous employer. Of workers with such savings plans, 26 percent were “very confident” about being able to afford retirement, compared with 10 percent of those who don’t have accounts.
Are you single? Social Security shows how your retirement could be at risk | The Motley Fool
Non-married people face a much tougher retirement than married people, according to data from the Social Security Administration. The median income for non-married seniors in 2013 was about one-third that of married seniors, with a typical single senior’s income clocking in at a mere $18,643 per year. While the road to a comfortable retirement is tougher for a single person than for a married couple, the more challenging path means that the sooner you get started, the better your chances of navigating it successfully.
Test your retirement IQ | Kiplinger
Ignorance may be the biggest threat to a comfortable retirement. Decisions leading up to retirement, including how much to save, how to allocate your investments, and how to anticipate retirement expenses can make a big difference. And the decisions don’t stop on Day One of post-career life. This quiz can help pinpoint how well-versed you are on this critical subject.
Stocks soar 13% in 5 weeks. Is the market too hot? | CNN Money
In just five weeks, the S&P 500 is up an incredible 13 percent from the February 11 lows. That rally has lifted the stock market into positive territory in 2016. Considering the market had its worst start to a year on record, it’s an impressive feat. But the speed of this rebound has some scratching their heads.
How to get people to delay retirement | The Wall Street Journal
The average American retires relatively early, at 64 for men and 62 for women. But with life expectancy rising by one to three moths with every year that passes, economists and policy experts say leaving the workforce at such ages is a luxury most people can no longer afford. Extending working lives is the most powerful lever we have to increase retirement security.
Defined benefitAlso known as a pension, this is a type of pooled retirement plan in which the plan promises to pay a lifetime benefit to the employee at retirement. The plan manages investments on behalf of members, and the retirement benefit is based on factors such as age at retirement, years of employment and salary history.Defined contributionA type of individual retirement plan in which an employee saves a portion of each paycheck (along with a potential employer match) and invests that money. The employee’s retirement benefit is based on their account balance at retirement. A 401(k) is a type of defined contribution plan.
