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Catching Up on Retirement Saving

 

If you are starting at or near 50, consider these ideas.

 Provided by Reeve Conover

 Do you fear you are saving for retirement too late? Plan to address that anxiety with some positive financial moves. If you have little saved for retirement at age 50 (or thereabouts), there is still much you can do to generate a fund for your future and to sustain your retirement prospects.

Contribute and play catch-up. This year’s standard contribution limit for an IRA (Roth or traditional) is $5,500; common employer-sponsored retirement plans have a 2018 contribution limit of $18,500. You should try, if at all possible, to meet those limits. In fact, starting in the year you turn 50, you have a chance to contribute even more: for you, the ceiling for annual IRA contributions is $6,500; the limit on yearly contributions to workplace retirement plans, $24,500.1

 

Look for low-fee options. Lower fees on your retirement savings accounts mean less of your invested assets going to management expenses. An account returning 6% per year over 25 years with an annual expense ratio of 0.5% could leave you with $30,000 more in savings than an account under similar conditions and time frame charging a 2.0% annual fee.2

 

Focus on determining the retirement income you will need. If you are behind on saving, you may be tempted to place your money into extremely risky and speculative investments – anything to make up for lost time. That may not work out well. Rather than risk big losses you have little time to recover from, save reasonably and talk to a financial professional about income investing. What investments could potentially produce recurring income to supplement your Social Security payments?

Consider where you could retire cheaply. When your retirement savings are less than you would prefer, this implies a compromise. Not necessarily a compromise of your dreams, but of your lifestyle. There are many areas of the country and the world that may allow you to retire with less financial pressure.

Think about retiring later. Every additional year you work is one less year of retirement to fund. Each year you refrain from drawing down your retirement accounts, you give them another year of potential growth and compounding – and compounding becomes more significant as those accounts grow larger. Working longer also lets you claim Social Security later, and that means bigger monthly retirement benefits for you.

Most members of Generation X need to save more for their futures. The median retirement savings balance for a Gen Xer, according to research from Allianz, is about $35,000. A recent survey from Comet Financial Intelligence found that 41% of Gen Xers had not yet begun to build their retirement funds. So, if you have not started or progressed much, you have company. Now is the time to plan your progress and follow through.3,

 

Reeve Conovermay be reached at 843-800-8190 or reeve@reevewillknow.com.

 

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

 

«RepresentativeDisclosure»

 

Citations.

1 – irs.gov/newsroom/irs-announces-2018-pension-plan-limitations-401k-contribution-limit-increases-to-18500-for-2018 [10/25/18]

2 – businessinsider.com/401k-fees-devastate-retirement-2017-5 [5/10/17]

3 – fool.com/retirement/2018/02/07/heres-what-gen-xers-have-saved-for-retirement.aspx [2/7/18]

4 – entrepreneur.com/article/309746 [3/2/18]

 

IRS Adjusts 2018 HSA limits

On Monday the IRS announced a reduction to the 2018 Health Savings Account (HSA) family contribution limit to $6,850 from the previously set amount of $6,900. If you have already contributed the maximum amount to your Family HSA for 2018, this could mean that election changes may be required and excess contributions may need to be returned. Contact Participant Services for more information.

This change does not impact contribution limits for individual HSAs, Flexible Spending Accounts (FSAs), Commuter Reimbursement Accounts (CRAs) or QSEHRAs.

CIGNA to acquire ExpressScripts

After CVS agreed to acquire insurer Aetna, CIGNA has agreed to purchase express scripts for $67 billion.  Express Scripts is the largest pharmacy benefit manager (PBM) in the country.  This continues the remake of the nations healthcare system through merger and acquisition:

 

“Aetna and CVS have said they hope to create “front doors” to healthcare through 9,800 stores run by CVS. That deal could turn many of the chain’s stores into one-stop-shop locations for an array of healthcare needs like blood work and eye or hearing care, in addition to their traditional role of filling prescriptions.

UnitedHealth Group Inc., which runs the nation’s largest insurer, is spending almost $5 billion to buy nearly 300 primary and specialty care clinics and some urgent care and surgery centres. That push will help the company steer patients away from expensive hospital care.

Another insurer, Humana Inc., is making a separate deal to better manage the care of its Medicare Advantage patients.”

Medi-Share expansion in Florida?

According to an article in the Orlando Sentinel, legislation is in moving forward in Florida allow this:

 

“TALLAHASSEE — A bill that could increase enrollment in health-care sharing ministries is headed to Gov. Rick Scott.

The House passed the measure (SB 660) by an 89-27 vote late Wednesday, with opposition coming from Democrats who expressed concerns that the Florida Office of Insurance Regulation doesn’t regulate such sharing arrangements. The Senate voted unanimously to pass the bill earlier in the session.

Health-care sharing ministries have been exempt from Florida’s insurance code since 2008 and limit participation to people who share the same religious beliefs. The bill would broaden current law to include people with the same set of ethical beliefs.

The bill, if signed by Scott, would benefit some large health-care ministries, including Melbourne-based Christian Care Ministries and its cost-sharing program known as Medi-Share.

Last year, Medi-Share, which promotes itself as “God-honoring health care” served 300,000 members nationwide who agreed to attest to a “statement of faith” that, among other things, said the Bible is “God’s written revelation to man and is verbally inspired.”

People who obtain coverage agree to not use illegal drugs, alcohol or tobacco and refrain from having sex outside of marriage or abusing legal drugs.

Members of ministries such as Medi-Share pay monthly membership fees or contributions. According to Med-Share’s website, the share is matched monthly with other people’s medical bills. Members know each month whose “eligible” bills they are helping to pay.

Enrollment in the ministries has grown since passage of Obamacare. That’s because it contains a provision exempting ministries that meet certain requirements from having to comply with the law, which required insurance companies to provide access to birth control.”

Medicare issuing new ID numbers

CMS will soon begin mailing out new Medicare cards to all beneficiaries that contain NEW Medicare Beneficiary Identification (MBI) numbers. The new Medicare identification numbers will no longer contain Social Security Numbers and are intended to help protect individuals’ identities. Below is important information related to the issuance of new Medicare cards:
  • New Medicare cards will be assigned to all Medicare beneficiaries
  • The new cards will contain an 11 character identifier that is unique to each beneficiary
  • The mailing will occur between April 2018 and April 2019.   Beneficiaries should be patient; they may receive their card at a different time than a friend or neighbor
  • Once beneficiaries receive their new card they are encouraged to destroy their old card and begin using the new card right away
  • This does not affect your ID card with your  Health Plan.
What you should do:
  • Please let us know as soon as you have your new number.   Click here to see how beneficiaries can update an address with Social Security:
Health Plans will update member’s files as CMS informs us of the beneficiaries’ new identification number, through 2019.
CMS will continue to accept existing Medicare numbers through 12/31/2019; however the transition will be easier if you submit enrollment forms using the new Medicare number whenever possible.
May 2018
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Reeve Conover is a Registered Representative. Securities offered through Cambridge Investment Research, Inc., a Broker/dealer member FINRA/SPIC. Cambridge and Conover Consulting are not affiliated. Licensed in SC, NC, NY, CT, NJ, and CA.
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