Couples Not Doing Social Security Planning

 

A majority of married couples in their 60s lack the knowledge about how to maximize their Social Security benefits and whether or not to expect Social Security advice from a financial planner. Social Security planning is becoming an expected service from financial planners. However, the vast majority of people are unaware of strategies that could increase their lifetime Social Security benefit by $20,000 to $40,000 or more.

Awareness of the various planning options available was more common among those with higher incomes and net worth. People who expected financial planners to perform Social Security planning and analysis for them were more commonly those with higher incomes and net worth.

Seventy-four percent of people with household income exceeding $200,000 would expect to receive advice on Social Security benefit options from a financial planner, compared to only 48 percent of those with household incomes less than $50,000.

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IRS Taxpayer Advocate Service Limits Its Assistance

 

The Internal Revenue Service’s Taxpayer Advocate Service is temporarily changing the criteria it uses for accepting cases and said it would no longer deal with cases in which the problem involves an IRS delay in processing certain tax documents.

Effective Oct. 1, 2011, the Internal Revenue Service generally would no longer accept cases that only involve processing delays for the following issues: original returns; unpostable or reject returns; amended returns; and injured spouse claims.

The service said it would no longer accept so-called “systemic burden” cases that fit the following criteria: the taxpayer has experienced a delay of more than 30 days to resolve a tax account problem; the taxpayer has not received a response or resolution to the problem or inquiry by the date promised; or a system or procedure has either failed to operate as intended, or failed to resolve the taxpayer’s problem or dispute with the IRS.

In these categories of cases, processing delays at the IRS typically arise either because the affected functions are overloaded with work or because of systemic processing glitches. Assuming these processing delays do not create an economic burden, the taxpayer advocate’s role is typically limited to contacting the appropriate IRS function to advocate for resolution of the taxpayer’s problem, providing updates to taxpayers, and looking for patterns of delay to identify systemic problems.

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Women Lack Retirement Confidence

 

While half of all individuals with at least $500,000 in investable assets are women, just 34 percent expressed confidence they would have enough money to live comfortably in retirement, while fully half feel they need assistance in managing their finances.

According to a report issued by the Insured Retirement Institute, “Women, Retirement, and Advisors: Concerned about Meeting Retirement Expectations, Female Boomers Seek Expert Advice,” guaranteed retirement income is the most important trait that Boomer women are looking for in an investment. When selecting a financial advisor, 71 percent said they value professional designations, while 61 percent cite trust and respect as qualitative factors.

The report also found that married women are more likely to be better prepared for retirement than unmarried women, with six out of ten married women saying they have tried to calculate the amount of money needed, compared four out of ten of unmarried women.

Nearly half of unmarried women expect Social Security to be a major source of retirement income (49 percent) compared to 39 percent of married women. Married women are more likely to have contacted a financial planner for retirement income advice, with 53 percent, compared to 32 percent of unmarried women.

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Things you can do to boost your retirement security as a woman

 

  1. Make a conscious effort to take charge of your own retirement planning. Don’t leave it to chance… or your husband. Start saving for retirement. No excuses.
  2. Get knowledgeable about finances. You don’t need to become a Wall Street wizard. You can learn enough to make intelligent choices – or at least understand the advice of experts – by reading a few books or attending one of those weekend seminars. Investing a few hours learning the basics can pay big dividends in knowledge today, and financial security tomorrow.
  3. Make maximum contributions to qualified retirement plans through work and IRAs on your own.
  4. If you’re married, take an active part in your household’s finances. Become economic partners with your husband.
  5. If you’re married, discuss the critical differences between joint and single life pension and annuity benefits. Under a single life option, when he dies, his benefits die with him. Also, since you probably will outlive him, make sure that your (his and yours) estate plan provides for you after he is gone.
  6. Look before you leap when changing jobs. Don’t go solely for a bigger paycheck; make sure you won’t lose retirement benefits. Also, you may want to think twice before retiring early – before your benefits are maxed out.
  7. Become financially aggressive. Historically, women have tended to be conservative with money. While this is changing, many women still tend to focus too much on protecting principal than on achieving solid returns.

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