There are many benefits to marriage, but one you may not yet have considered is the flexibility married couples enjoy when deciding how and when to claim Social Security. Even though the basic rules apply to everyone, a couple has more options than a single person because each member of a couple1 can claim at different dates, and may be eligible for spousal benefits.
For much of the last decade, inflation has been low by historical standards. But, recently, wage growth and higher prices have sent signs that inflation may be making a comeback, serving as a reminder of the risks that come when the buying power of a dollar falls. Such risks always exist, even when they don’t seem so obvious.For much of the last decade, inflation has been low by historical standards. But, recently, wage growth and higher prices have sent signs that inflation may be making a comeback, serving as a reminder of the risks that come when the buying power of a dollar falls. Such risks always exist, even when they don’t seem so obvious.
You saved for years to get to retirement—contributing to a traditional 401(k) or IRA. Now it’s time to dip into those savings—even if you don’t really need to. Because you got a tax break when you contributed to these accounts, once you turn age 70½ the IRS requires you to withdraw every year from your traditional IRA or employer-sponsored retirement plan account, such as a 401(k) or 403(b), and start paying taxes on that money.1 It’s important to determine how these minimum required distributions—known as MRDs or RMDs (required minimum distributions)—fit into your retirement income plan.
You’ve likely spent a good deal of time thinking about investment risk. But have you stopped to think about more personal security issues, such as the safety of your online financial transactions and information stored on your computers? While most people recognize that online fraud or cybercrime is a potential threat, few know how or why they may be at risk. Cybercrime can take many forms, and understanding who the enemies are and how they commit crimes, may allow you to better defend yourself.
When planning for retirement, many people think that what they see in their retirement accounts is what they’ll have to spend in retirement. What they sometimes forget about are the taxes they will need to pay on certain withdrawals, like those from traditional 401(k)s and IRAs. “It’s not what you earn that counts but how much you get to keep after taxes,” says Matthew Kenigsberg, vice president in Fidelity’s Strategic Advisers. “Also, managing your tax brackets in retirement can help preserve more of your money for the next generation.”
Learn to navigate the costs, shifting coverage options, and insurance policy features.
No one really likes to think about needing long term health care services. But the reality is that each year, an estimated 12 million Americans need some type of long term care.
Are you prepared? According to the Department of Health and Human Services, the average use of long term care services is three years.2
Long term care is a key risk to your retirement plan, and you need to plan for it. It will affect you and your caregivers financially, physically, and emotionally. Having a plan to address these concerns is critical to easing the burden of this risk on you, your family, and your friends. Indeed, 51% of caregivers said providing care reduced the time they spent with their children and spouses/partners as well as time to take care of themselves.
Get answers to common questions on eligibility, claiming strategies, spousal benefits, and more.
What role do your Social Security benefits play as part of your retirement income strategy? Are you and your spouse or partner maximizing your benefits? What if you continue to work after claiming?
Answers to these questions were highlighted in a, “Make the most of Social Security,” webcast moderated by Kerry Sweeney Harris, vice president at Fidelity Investments. Panelists included Marcia Mantell, president of Mantell Retirement Consulting, and John Wells, a Fidelity planning and guidance consultant.
Key topics covered during the webcast included Social Security eligibility, benefits calculations, claiming strategies, and spousal benefits. Here are a few highlights, or watch the full webcast.
Tax-free growth potential and tax-free withdrawals in retirement—the tax benefits of a Roth IRA are clear. If you aren’t able to contribute to a Roth IRA because of the income limits, a Roth conversion for eligible retirement accounts is another way to have a Roth account. But, does it make sense if you are in or within 15 years or so of retirement? The answer: Maybe. A Roth IRA, even via a conversion, has the potential to benefit your retirement and legacy planning. That’s why we believe everyone should at least investigate a Roth IRA.
After working hard to build your retirement savings, don’t let taxes take a big bite out of them.
Chances are you contributed to a 401(k) or IRA as you saved for retirement. Now the time has come to use that money. Withdrawing from your retirement savings with an eye toward reducing taxes is important. Not only do taxes reduce your income, they can diminish potential future earnings and growth, which affects how long your savings may last.
“The important thing to keep in mind is that managing your withdrawals with taxes in mind can help boost your income in retirement,” explains John Sweeney, executive vice president of retirement and investing strategies at Fidelity.
Let’s start by reviewing the types of investment accounts and then some tax-efficient ways to withdraw from them. Of course, everyone’s situation is unique, so it is important to consult a tax professional.
Get answers to questions about eligibility, choices, costs, and when and how to sign up.
1. When am I eligible?
Normally, your health insurance coverage under Medicare begins when you reach age 65. However, you also may be eligible for Medicare at any age if you are diagnosed with end-stage renal disease or another qualifying disability.
When you do become eligible, you’ll want to remember to sign up within the seven-month time frame that begins three months before the month you turn 65 and ends three months after the month you turn 65. “If you miss this initial deadline, your coverage will be delayed because you’ll have to wait until the next January to March general enrollment period and your coverage won’t be effective until the following July,” Czarnowski cautions. You also may have to pay more for some of your coverage. You can enroll on the phone or at your local Social Security office.
If you’re still working when you’re 65 and get health insurance through your employer or your spouse’s employer, you don’t have to enroll right away, as long as you can prove that you had this coverage when you sign up later on.