Don’t Want to Delay Retirement? Here’s Another Option…
Although the current retirement age is 66, many seniors continue to work, even though they are eligible for full Social Security benefits. In fact, research by Provision Living (a provider of services for older adults) revealed that in U.S. cities with populations of 200,000 or more, at least 20 percent of people ages 65 and up were still working. Results of a more recent poll by Provision Living (August 2019) showed that 55 percent of respondents worked part time and 45 percent worked full time. Survey participants were between the ages of 65 and 85.
Why do seniors continue to work?
A sizable amount—one third—enjoy working and don’t want to retire, or prefer working but with fewer hours. However, 62 percent of respondents cited finances as the reason why they were still in the workforce; they couldn’t afford to retire, they were supporting families, or were still paying off debt. For many, their retirement savings were not at the level needed for a comfortable retirement that was not largely dependent on Social Security benefits.
In fact, 70 percent of working seniors in the survey said that Social Security would be their primary source of income after retirement. The others said a pension, 401(k), personal savings, and stocks would be their main income source in later years. A small percentage (11 percent) said they planned to rely on children or family to support them.
Plan for a comfortable retirement through self-direction
If you enjoy being in the workplace, that’s great! But if you’re thinking ahead to either working less or not at all, have you thought about self-directing your retirement plan?
Opening a self-directed IRA opens the door to building a more diverse retirement portfolio allowing you to invest in alternative assets such as real estate, private equity, unsecured or secured loans, and precious metals. Self-direction can be a powerful way to build retirement savings—and gives you the option to delay retirement because you want to keep working, not because you must due to finances.
Savvy investors who are comfortable making their own investment decisions can invest in what they already know and understand, take advantage of certain market opportunities, and enjoy tax-advantaged retirement savings.
The Social Security Trust Fund has an uncertain future which will affect many of today’s workers. Corporate pensions are disappearing. The stock market is unpredictable. Those who wish to self-direct their retirement plans can better control their futures, today—and create a hedge against market volatility.
Want to learn more about self-directed retirement plans? Contact us to set up a complimentary educational session. Alternatively, you can contact our team with any questions about self-directed IRAs and the many types of nontraditional investments these plans allow. We’re available via phone at 1-888-857-8058, or email at NewAccounts@NextGenerationTrust.com.
Are You Headed for a Retirement Income Crisis?
Financial advisor Ric Edelman (founder of Edelman Financial Services) was on Capitol Hill this summer with an urgent message for lawmakers: beware the retirement income crisis that will hit in 14 years. He was speaking at an event called “Planning for 75 at 25: Saving for Retirement and How Policy Affects You.” The event was held by the Funding Our Future Coalition, an organization launched by Edelman and the Bipartisan Policy Center in February.
His bottom line was this:
- The country is facing an enormous challenge regarding Social Security and Medicare
- Under current law—which was passed 35 years ago in 1983—Social Security retirement benefits will be cut 23 percent across the board starting in 2034. This cut will be for all retires equally, regardless of financial status.
- This action will lead to millions of retirees facing an economic crisis, because more than half of today’s retirees rely on Social Security for more than half of their income.
- Congress will raise taxes significantly in order to shore up cash reserves to avoid this from happening, creating a massive burden on younger workers.
- Two-thirds of Americans aged 21 to 32 have nothing saved for retirement.
Edelman added that many Americans—including sitting members of Congress who came into office long after the law was passed—are unaware of this legislation.
Open a self-directed IRA and head away from a retirement crisis
As many savvy investors already know, saving for retirement with a self-directed IRA is one way to avoid the forecasted economic crisis during one’s retirement years. By building a more diverse portfolio with alternative assets, and by making all your own investment decisions, you’re in control of your future. Whether you include real estate, precious metals, private equity, commodities, or other nontraditional investments allowed in a self-directed IRA, you can grow your retirement savings with the same tax advantages of regular retirement plans, but with far more investing options.
You can read up on self-direction as a retirement strategy in our whitepaper library and our handy starter kits will help you open an account. The team at Next Generation is here to answer any questions you have about self-directed IRAs; contact us at 1.888.857.8058 or NewAccounts@NextGenerationTrust.com.