Does your ideal retirement include hours at the beach, challenging hikes or tennis matches? Maybe you want to enroll in writing classes, volunteer or finally get to some art museums. Whatever youre dreaming of, the first question to ask is: Where should I live?

While theres no simple answer, we tried to make it a little easier for you to decide the best place to retire. Money combed through about 47,500 data points and considered factors like housing, climate, diversity and safety to create a list of destinations to suit every taste and budget. You can see more about our methodology below.

Of course, 2020 isnt a normal time, and the pandemic means that some of the fun activities weve highlighted cant happen right now, or are only happening with special safety modifications. Even traveling to scope out new places may be unsafe for the time being. But choosing the right spot is a decision youre making for the long haul. So our list weighs factors that will make these cities stand out over time, plus natural attractions that can be enjoyed right now.

Focal Flame Photography / Courtesy of Destination Madison

Population: 256,000 Population 50-plus: 28.2% Days of sunshine a year: 185 Median home price: $292,000

A college town in the Badger State might not spring to mind as an ideal place to retire. But with tons of recreational activities and natural beauty, Madison, Wis. a metropolitan area sandwiched between two lakes has taken the top spot on our list.

Its many charms come at an affordable price. The citys median home price, $292,000, is one of the lowest of all our winners.

Usually, living near the University of Wisconsin has its perks. People aged 60 and older can also audit courses at the university for free, and during this fall semester, 800 did so virtually, according to the university. During a typical weekend, people can stroll in the university Arboretum and the Lakeshore Nature Preserve on campus.

Madison has a bustling restaurant scene and free events, like Wisconsin Chamber Orchestra concerts on the lawn of the state Capitol. Also near the Capitol is the Dane County Farmers Market, which touts itself as the largest producer-only market in the country and has extended its outdoor season during the pandemic.

The citys art institutions, like the Madison Museum of Contemporary Art, and many movie theaters can provide a safe haven during a cloudy day. And when family visits, you can easily entertain kids by visiting the Madisons Children Museum and Henry Vilas Zoo, or renting a paddle board or kayak at one of the nearby lakes.

The state capital has 38 retirement communities, the most of all our winners.

Wisconsins sales tax is just around 5% among the five lowest in the country and the state provides property tax breaks for older residents. COVID-19 has certainly taken its toll on Wisconsin, but its workforce has fared better than much of the country, with its unemployment rate at 5.7% in October compared to the countrys 6.9%.

Population: 83,000 Population 50-plus: 48.4% Days of sunshine a year: 244 Median home price: $211,000

Once known as the Citrus City for its shipping of citrus to northern states, Largo, Florida is at the heart of Pinellas County, a peninsula surrounded by Tampa Bay and Gulf of Mexico. The city may not be a well-known retirement destination like Boca Raton to the southeast, but it offers plenty of beautiful beaches and sun for less.

Largo has the lowest median home price of our winners at $211,000. And Florida ties with Tennessee as being the most tax-friendly on our list, according to our data; neither has a state income tax. With 24 retirement communities in the area and nearly half the population aged 50 or older, its a welcoming place for retirees.

The city along the Gulf Coast scored highest among our winners for a pleasant atmosphere, thanks to its walkability and great weather. On a sunny day, residents can explore the Florida Botanical Gardens or 70-acre Largo Central Park with fountains, picnic pavilions and a playground. Those looking to entertain visiting friends and family can head to the Central Park Performing Arts Center to see music, dance and theater performances.

Of course, a main attraction for Largo is its proximity to beaches along the Gulf of Mexico and there are many to choose from. Largo residents are close to beaches with public access, like Indian Rocks Beach, St. Pete Beach and Clearwater Beach, which was named TripAdvisors best beach in the U.S. for three of the last five years (the other two years it was Siesta Beach, which is under a 90-minute drive from Largo). Finally, you cant talk about Florida without mentioning golf courses, and Largo is home to plenty, including the East Bay Golf Club and Pinecrest Golf Club.

Population: 62,000 Population 50-plus: 43.9% Days of sunshine a year: 205 Median home price: $500,000

Settled in the 1600s by Welsh Quakers, Lower Merion, Pennsylvania borders Philadelphia. The township has a suburban feel and easy access to a vibrant city known for its food and art scenes.

If being close to health care options in retirement is a concern, this city could be a good spot for you. In addition to having both the Bryn Mawr Hospital and Lankenau Hospital, Lower Merion has a high number of primary care providers, mental health providers and doctors in the area for its population, according to our data. However, this access does come at a cost. While Lower Merion scores highest among our winners for the strength of its economy, it also has the highest median home price on our list at $500,000.

But if youre looking for a variety of ways to stay mentally and physically active, Lower Merion the home of the womens college Bryn Mawr could be worth it. From the 12-acre Barnes Arboretum (which housed the well-known art institution the Barnes Foundation before it moved to Philly in 2012) to hikes along the Main Line, like the Cynwyd Heritage Trail, this spot is great for walkers. The pedestrian and bicycle network connects parks and the Schuylkill River with neighborhoods, businesses, schools and more.

For those looking for some indoor entertainment, being so close to the City of Brotherly Love means Lower Merion has 234 museums and 367 theaters within a 15-mile radius. Meanwhile, those 55 years old or older can become members of the Center For Positive Aging in Lower Merion (PALM), which offers services including weekly grocery shopping and free medical screenings, as well as classes, workshops and entertainment, some of which has continued virtually through the pandemic.

Population: 84,000 Population 50-plus: 36.5% Days of sunshine a year: 208 Median home price: $495,000

Most cities cant boast a history that spans from Benjamin Franklin to Neil Diamond and Taylor Swift but Franklin, Tenn. can. Named after the founding father and home to Dark Horse Recording Studios, where many well-known musicians have recorded albums, the city has made the top 10 of Moneys Best Places to Live lists for three of the last four years. Its secret is out: Franklin was one of the fastest growing large cities between 2010 and 2019, according to the Census Bureau.

While Franklins median home price is $495,000 high compared to some other cities on our list its lower than those in neighboring city Brentwood. The citys overall housing market ranked high among our winners, as relatively few households spend more than half their income on housing.

It may be just a half-hour drive to Nashvilles legendary music scene, but Franklin offers plenty of attractions in its own right. From walking tours of sites from the Civil Wars Battle of Franklin, to museums like the Lotz House and Williamson County Museum, youre not likely to get bored of the citys history. The historic district in Downtown Franklin also has 15 blocks of modern-day activities: restaurants, shopping, art galleries and more. And if you want to hear good live music, you dont have to travel to Nashville. At Pucketts Grocery & Restaurant you can enjoy live performances over some BBQ, and the Pilgrimage Music Festival has brought a wide variety of artists the Foo Fighters, Lionel Richie, Sheryl Crow and Justin Timberlake, to name a few to Franklins Harlinsdale Farm.

Focal Flame Photography/courtesy of Destination Madison

Brett Sayles / Boise Convention and Visitors Bureau

Population: 234,000 Population 50-plus: 34.1% Days of sunshine a year: 210 Median home price: $335,000

Where is the largest concentration of Basques the ethnic group with roots in the western foothills of the Pyrenees Mountains in the U.S.? If you somehow guessed Boise, Idaho, youd be correct. Idahos capital and most populous city even has the Basque Block downtown, with the Basque Museum and Cultural Center and The Basque Market, where you can find pintxos (Basque for tapas, small plates meant to be shared) and paella.

Boise State University makes Boise a university town, with over 26,000 students enrolled in 2019. Thats likely why it scored high for convenience in our rankings, with its proximity to grocery stores and food markets, pharmacies, banks, shopping centers and more.

Boise has the feel of a big city without the price tag that usually comes attached. Idahoans have low utility costs compared to the rest of the country and the lowest average monthly gas bill, according to a recent report from Move.org. And people 65 and older can ride the local bus system for as low as 75 cents.

Boise also has a thriving art scene. The city not only has street art and the Boise Art Museum, its also home to the Gene Harris Jazz Festival and Idaho Shakespeare Festival, as well as Ballet Idaho and the Boise Philharmonic. Yet amid all this culture, you dont have to compromise access to nature: residents also enjoy the view of Idahos mountains. In just one day, you can easily go from fishing or canoeing on the Boise River in the morning, to biking along the 25-mile Boise River Greenbelt in the afternoon to grabbing a bite downtown for dinner.

Population: 154,000 Population 50-plus: 38.6% Days of sunshine a year: 245 Median home price: $392,000

Just eight miles west of Denver a 15-minute ride on the light rail train Lakewood isnt bogged down by skyscrapers. Neighboring the foothills of the Rocky Mountains, Lakewood has more than 7,200 acres of open space.

Houses in this city may cost more than some of our other winners, but median home prices fall short of the home sale prices in many other Colorado cities, like Centennial and Denver. And it makes up for that cost elsewhere, especially with inexpensive fun for the whole family. There are more than 850 amusements (think festivals, zoos, boat rentals and more) and 265 theaters within 15 miles.

Colorado is a go-to spot for anyone who loves the outdoors, and living in Lakewood means you have skiing, boating and hiking destinations like Bear Creek Lake Park, which has 15 miles of trails just a short drive away. But there is also plenty to keep you entertained indoors, from the Belmar shopping and dining spot with over 80 retailers and restaurants, to the Lakewood Cultural Center with art galleries and performing arts classes throughout the year.

For those over the age of 55, the Lloyd G. Clements Community Center offers day trips, drop-in activities like dance and art classes, sports, community meals and more. The Older Adult Wellness Fair (although cancelled this year due to COVID-19) usually brings the community together for fitness classes, strength tests and health assessments.

Courtesy of Explore Asheville

Population: 94,000 Population 50-plus: 35.8% Days of sunshine a year: 212 Median home price: $328,000

Youre probably not looking to retire in the largest privately-owned house in the country, but if you were, youd head to Asheville, N.C. The Biltmore House, now a museum, has 35 bedrooms, 43 bathrooms and 65 fireplaces.

Biltmore aside, the cost of living is relatively low in Asheville. You can get a hamburger at Tastee Diner for just $5, and the bus fare for those aged 65 and older is just 50 cents (or $110 for an annual pass).

At the Osher Lifelong Learning Institute (OLLI) at University of North Carolina (UNC) Asheville, older adults can take classes from UNC faculty on everything from economics to photography (classes have moved online during the pandemic). You can also take advantage of the local Blue Ridge Mountains with Senior Treks, low-impact hikes run through the Asheville Parks and Recreation Outdoor Programs. The hiking opportunities dont stop there Asheville is less than an hour-long drive from the Great Smoky Mountains National Park and the Pisgah National Forest.

And once youre comfortable dining out again, you wont run out of new restaurants to try. Asheville was on The Daily Meals 2019 list of top foodie towns in America, and its visitors bureau Explore Asheville refers to it as a Foodtopia. It seems to live up to the name. Asheville has the highest numbers of bars and restaurants per capita among our winners.

There are also 12 retirement communities in the area.

Population: 45,000 Population 50-plus: 43.7% Days of sunshine a year: 205 Median home price: $390,000

Bridgewater Township in New Jersey has changed plenty since the stars-and-stripes flew above it for the very first time in 1777. From a small farming community as recently as the fifties, the township has evolved into one of the hottest suburbs of New York City because of its proximity to the Big Apple alongside affordable real estate and lower crime rates.

Located just 40 minutes from Newark and 90 minutes by train from Penn Station in Manhattan, Bridgewater has median home prices of $390,000. Compare that with half a million dollars for the New YorkNewarkJersey City metro area.

One of Bridgewaters major draws is the Washington Valley Park, where visitors can enjoy 720 acres of pine and hemlock forests, as well as a 21-acre reservoir open to fishing. A network of trails allows for hiking and mountain biking, while the Hawk Watch Area is popular with birdwatchers, as it provides a spot to view the August to November migration of raptor birds (including hawks, ospreys, and bald eagles) down south.

Back in town, golf enthusiasts will enjoy hitting the links at the Green Knoll Golf Course, one of the many publicly maintained courses in Somerset County. Green Knoll offers challenges for golfers of all levels, while aspiring golfers can take courses at the Learning Center in the Neshanic Valley Golf Course in nearby Neshanic Station.

For a taste of MLB-level talent without the price tag, you can catch the Somerset Patriots, the New York Yankees Double-A affiliate team, at TD Bank Ballpark. Premium field box tickets go for as low as $15 (though games with crowds are currently on hold due to the coronavirus pandemic.)

Population: 143,000 Population 50-plus: 36.2% Days of sunshine a year: 265 Median home price: $461,000

The city of Roseville is located 20 minutes north of Sacramento to the east of the Sierra Nevada Mountains. Like the rest of the Sacramento area, Roseville enjoys a Mediterranean climate. Living there doesnt just mean great weather; it also means great wine.

There are 52 vineyards within 25 miles of Roseville, the most of any city on our list. From family businesses like Dora Dain Wines to world-class wineries like Wise Villa, its easy to make a weekend (or four) out of tasting the best varieties the region has to offer.

All these sunny days mean theres plenty of fun to be had outdoors. There are plenty of golf courses in the city, including the Sierra View Country Club and the Woodcreek Golf Club. Roseville also has the All-American Speedway, a NASCAR-sanctioned racetrack that is a favorite with locals.

The Westfield Galleria, the second-largest mall in northern California, is located in the city, featuring flagship store Nordstrom and everything from Hugo Boss to the Disney Store. Other malls in downtown Roseville are Stanford Ranch and the Ridge at Creekside.

And once youve explored everything Roseville has to offer and it might take a while just remember that Lake Tahoe and the Sierra Nevada ski resorts are just two hours away.

Population: 84,000 Population 50-plus: 41.8% Days of sunshine a year: 278 Median home price: $367,000

This vibrant state capital in the foothills of the Sangre de Cristo Mountains is famed for its cultural scene and natural beauty, making it ideal for retirees who want to live life to the fullest.

Santa Fe has the most clear-sky days of any city or town on our list, which is great news for outdoor enthusiasts. There are hundreds of trails in and around Santa Fe for beginners and experienced hikers alike, with the Santa Fe National Forest being a major destination. This forest spans over one million acres, including 300,000 acres of untouched wilderness, 1,000 miles of rivers, and almost 20 lakes open to fishing with a New Mexico license.

If youre more drawn to cultural attractions, theres a lot to love about Santa Fe. History buffs will enjoy walking the historic city center, with its old-fashioned adobe buildings, local eateries and shops, and landmarks like the Loretto Chapel, famous for its miraculous staircase, a spiraling wooden structure with two 360-degree turns and no visible means of support.

Santa Fe is also home to dozens of museums and art galleries. Some standouts are the Museum of International Folk Art, where the Girard Wing features a Mexican town in miniature, and the Georgia OKeefe Museum, dedicated to the artist who lived her last years in Santa Fe. Another local favorite is El Rancho de las Golondrinas, a living 18th-century village with adobe houses and costumed re-enactors. Multiple events are held in the ranch year-round dont miss the Santa Fe Wine Festival in July or the Harvest Festival in the fall.

To find Moneys Best Places to Retire, we looked only at places with populations above 50,000. We eliminated any location that had more than double the national crime risk, less than 85% of its states median household income or a lack of racial diversity. This gave us 1,890 places.

We then collected about 47,500 different data points to narrow the list, and filtered out locations with a median sales price above $550,000 in the first quarter of 2020. We considered data on each places housing market, economic health, cost of living, quality of life, mental and physical health factors, diversity and amenities, all provided by research partner Witlytic. You can view more information about the data we used here. To pick the retirement destinations noted here, we put the greatest weight on quality of life factors (like weather and percentage of residents age 50 or above), cost of living, health and safety amenities and the housing market.

Among the statistics called out here: Population and percent of population age 50 or above data reflect Synergos Technologies Inc.s interpretation of Census and IRS data. Median home sale price reflects the first quarter of 2020 median from Attom Data. Count of days of sunshine a year reflects clear day data from the National Oceanic and Atmospheric Administration.

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The 10 Best Places to Retire in America - Money

Justice of the Peace Pedro Hernandez performs a wedding in 2011.

Yellowstone County Justice of the Peace Pedro Hernandez is sworn in by Judge Ingrid Gustafson during a ceremony at the County Commissioners offices in 2010.

Three years after retiring, former Yellowstone County Justice of the Peace Pedro Hernandez died Sunday afternoon of COVID-19 related pneumonia.

At the time his retirement was announced in Sept. 2017, Hernandez was 76 years old and had worked as a judge for 42 years. He said at the time that he was the longest-serving elected judge in Montana.

The judge was married to Debby Hernandez, who served as Yellowstone County's auditor from 2003 to 2017. She also announced her retirement in September 2017.

Pedro Hernandez was appointed in 1975 to fill a vacancy. He served in the U.S. Air Force during the Vietnam War and studied criminal and juvenile justice at Eastern Montana College, now known as Montana State University Billings.

In 1970, Hernandez became a police officer before taking a job in 1972 as a probation officer for the 13th Judicial District.

Hernandez did not have a law degree, which is not a requirement for a justice of the peace. He had said in the past that he met all of the education requirements to serve as judge, completed mandatory training and testing and maintained his certification as required by the Montana Supreme Court.

At the time of his retirement he was a member of the Yellowstone County Bar Association, the American Bar Association and the American Judges Association.

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Pedro Hernandez, retired justice of the peace, dies - Billings Gazette

While the iShares fund has impressive average returns, performance from one year to the next has varied widely. In 2013, for example, the fund grew nearly 34% -- but then it showed a 0.78% loss in 2018.

That's the nature of growth funds; they can be a rollercoaster ride. Keep that in mind as you decide how to use this position. It could be appropriate for a long-term savings goal, like saving for retirement healthcare costs that you'll incur 25 years from now. But if you need the money within the next 10 years, you might want something more stable.

Planning for your future healthcare expenses is not an exact science. Even so, it is safe to assume that your medical costs will probably be the largest line item on your retirement budget. And that means you're smart to save and invest as much as you can now in your HSA. You can always adjust your plan later, but you can't go back and make up for earnings missed because you didn't start saving soon enough.

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Ill be 57 next month and am divorced with three kids living with me. One is 28, shes working, another is 21 and a senior in college (with a full scholarship) and the youngest is 15 (a sophomore in high school with a full scholarship).

I plan to retire at the end of next year with $25,000 in credit card debt and 15 more years to pay my mortgage. The credit cards have 0% interest. I have a good medical benefit when I retire and it will cover my two sons under 26 years old. My monthly expenses are $2,000, including life insurance, utilities, and a car payment.

My mortgage is around $4,000 monthly impounded. The interest rate is 2% until January 2022, then 3% until January 2023 and the remaining loan is 4.5%. Is it worth it to refinance to a lower rate? I also plan to just pay the principal and pay interest in December and April. I have two credit cards: one that totals $20,000, where the 0% promo ends in April 2021, and another with $4,500 where the 0% interest promo ends this December.

I work for the state and have a pension and 401(k) and 457 investments that total $110,000. I also have one months worth of expenses in an emergency fund. I can only apply for a loan to the retirement accounts while employed.

I would like to ask if retiring will be a good idea. If so, is it appropriate to take a loan with my investment to pay off the credit card debt before retiring? Based on our benefit, I dont have to repay the debt (to the 401(k)) after my retirement unless I win the lottery or something. There wont be a penalty. My annual gross income is $96,000.

Im a cohabitant with my ex on the house but get no contribution from him at all. I am working with my lawyer to see if I have the right to kick him out of the house.

Please help.

Thank you.

CDT

See: Im a 57-year-old nurse with no retirement savings and I want to retire within seven years. What can I do?

Dear CDT,

You have a lot to juggle, so the fact that youre reaching out to someone for some financial guidance should be deemed an accomplishment all its own!

The truth is, you may want to hold off on retiring if you can. Having $110,000 in retirement accounts is great, and you dont want to have to start dwindling that down while also trying to manage a way to effectively pay down credit card debt and a mortgage. Should an emergency arise, taking a big chunk out of that nest egg could end up hurting you significantly in the long run.

I think she needs to take a hard look at her income and expenses, said Tammy Wener, a financial adviser and co-founder of RW Financial Planning. When it comes to retirement, so many things are out of your control, like inflation and investment return. The one thing you do have control over is expenses. Furthermore, your pension may be enough to maintain your lifestyle though advisers wondered what exactly you would be getting from that pension every month but you would still be better off with a larger nest egg to fall back on.

Say you retire next year after all, but you still have credit card debt and hefty bills to pay. Any retirement income you have with and outside of your current funds may not be sufficient for your current living expenses, and if in a few years you realize this, you could end up back in the workforce though it may be hard to get the same or a similar job you already have.

Lets look at your 401(k) and 457 plans for a moment. You said you could take a loan and based on your benefit you dont need to pay it back, but you should be extremely cautious about this. With 401(k) loans, employees may be required to repay that loan if theyre separated from their employers, so this is a stipulation you should absolutely verify. If there was any misunderstanding as to how a loan is treated, that remaining loan would be treated as taxable income when you left your job, Wener said.

Financial advisers usually caution investors not to take loans and withdrawals from retirement accounts if they can avoid it, and in your case, this may be especially true as you plan to retire in the next year. When you take a loan, you may be paying yourself and your account back, but your balance is reduced by the amount of the loan, which means you could lose out on investment returns. In the midst of this pandemic, many of the Americans who took a loan or withdrawal regret it now, a recent survey found. I would not recommend swapping debt by taking a loan from her investments, said Hank Fox, a financial planner. Instead, she should pay whatever amount is due each month to avoid the finance charges and continue to pay-down the balances.

Dont miss: 5 ways to find free financial advice

Also, consider what would happen if you continued to work: youd still be able to contribute to a retirement account, boost your savings and, if applicable, reap the rewards with an employer match. Youd also narrow the amount of time you have between retirement and when you can claim Social Security benefits, Fox said.

Outside of the retirement accounts, you should try to build a sizable emergency fund, Wener said. Financial advisers typically suggest three to six months worth of living expenses, though you might want to strive for closer to six to offset any undesirable scenarios.

Im not sure what the motivation was to retire next year, but if you can delay it, this may be the best solution. The first thing I would recommend is that she reconsider retiring next year, Fox said. Since she will be 57 in November and assuming she is in good health, she should expect to be in retirement for 30 years or more.

If postponing retirement is not an option, and it isnt always, he suggests reducing or eliminating your mortgage, since its your largest expense by far. You could refinance, Wener said. Interest rates are very low these days, and while you may end up paying a little more every month for the next two years compared with that 2% rate you currently have, youd end up paying the same and then less from February 2022 and on.

As for your credit cards, having a 0% interest rate is such a huge help in paying off debts faster, so you should try to extend that benefit, either by calling and asking about your options with your current credit card company or looking at alternative 0% interest cards.

A financial adviser specifically, a Certified Financial Planner could really help you crunch the numbers and find meaningful ways to make the most of the money you have now and will be getting in retirement, said Vince Clanton, principal and investment adviser representative at Chancellor Wealth Management.

An adviser can gather information on your current earnings and expenses, retirement savings, potential Social Security benefits and pension and create a financial plan to help you navigate retirement. Voluntary retirement, and particularly early retirement, are very big decisions, Clanton said. Its extremely important to know and understand all of the variables.

Letters are edited for clarity.

Have a question about your own retirement savings? Email us at HelpMeRetire@marketwatch.com

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I want to retire next year, but I have $25,000 in credit card debt and a major monthly mortgage payment I also live with my three kids and ex -...

Retirement savers may never have had it more difficult.

For decades, financial advisors routinely recommended an investment portfolio of 60% stocks and 40% bonds. It was seen as a goldilocks formula, combiningpotential for growth with protection if stock prices fell.

But the interest rate on benchmark 10-year US government bondslong a core part of the everyday persons retirement portfoliois hovering near record lows at around 0.8%, with little chance of rising anytime soon. The Federal Reserve, seeking to give the economy a boost, is likely to keep yields near zero until at least 2023.

To be ready for retirement, most people are going to have to find a way to save more, take more investment risk, or work longer than they might have expected. The famed 60-40 portfolio, which has returned about 10% a year since the depths of the 2008 financial crisis, may generate returns of about half that in the coming years according to some projections.

This is the hardest investing environment a lot of people have ever had to face, says Ben Carlson, director of institutional asset management at Ritholtz Wealth Management. At our firm, weve racked our brains forever about thiswhats the alternative? Is it dividend stocks? Is it corporate bonds, is it emerging market bonds? There really is no easy answer.

Treasury bonds have long performed an important job for investorstheyre pretty much the only asset that tends to increase in value when theres a panic, whether thats from a terrorist attack or a financial crisis. Giulio Renzi Ricci, senior investment strategist at Vanguard, says Treasuries still have a role to play as a shock absorber, and he continues to expect US government debt to be a haven when times get tough.

But once you account for inflation, government bonds have always been vulnerable to losing money. In inflation-adjusted terms, (using the CPI index, for example), 10-year Treasury securities are in negative territory, as theyve often been historically. And with the notes currently yielding less than 1%, their capacity for absorbing shocks has been greatly diminished.

Even a small drop in investment returns has immense impact onwhen, or whether, people can afford to retire. Imagine a 35-year-old investor who has socked away $50,000 and plans to put away $500 a month for the next 30 years. An annual return of 7% would result in a retirement portfolio worth more than $1 million when the person is 65. An annual return of 4% would result in holdings worth about half of that, around $513,000plus, three decades of inflation will eat into those returns, raising the risk that the person outlives their savings.

Finance professionals have mixed opinions on where to go from here.

As far as Jared Woodard is concerned, the 60-40 portfolio is dead. I came out with this thesis a year ago, and Im more confident than I was before, said Woodard, who heads the research investment committee at Bank of America.

He argues that such a conservative portfolio has pretty much always been a bad deal for investors: a dollar invested the entire US stock market in 1950 would be worth $1,763 now, while a dollar in a 60-40 portfolio would have only risen to about $535.

If investors cant afford to save more, they may instead dial up the risk, pushing more of their holdings into stocks (an 80-20 portfolio, perhaps), or swapping government bonds for corporate bonds and loans, emerging-market assets, or longer maturity debt. (Woodard thinks savers can take prudent risks by investing some of their money in things like corporate bonds and loans, higher yielding municipal debt, and even tech stocks, which have been a crowded trade for some time but remain one of the few places to find companies with decent earnings growth.)

But taking more risk has, well, risks. In swapping out Treasuries for riskier securities, youre diluting your diversification benefits, Vanguards Ricci says. Youre getting more expected return but for a higher level of risk.

If the stock market tanks just before a person retires, they might not be able to ride out the losses before theyre due to stop working.

Surprisingly, even as the hope for returns dwindles, investors in the US dont appear to be giving up on bonds. So far this year theyve put almost $20 billion into exchange-traded funds for Treasury debt, though thats on pace for the lowest annual total in four years, according to Eric Balchunas, an analyst at Bloomberg Intelligence. Corporate bond ETFs, meanwhile, have sucked in more than triple that amount. (Much of that money was probably trying to get in ahead of the Fed, which bought company debt ETFs for the first time ever. The central bank did so to keep the coronavirus pandemic from disrupting corporate financing markets.)

With Treasuries yielding so little, some investors have looked to gold as their crisis hedge. Gold ETFs have taken in $32.5 billion this year, blowing away the old annual record of $12 billion.

Research suggests that a lot of Americans are fairly risk-averse when it comes to their savings. In a Wells Fargo/Gallup survey about investment and retirement optimism, only 4% of the respondents said they were comfortable taking a lot of risk, while 46% said they wanted to take only a little risk. When it comes to investing, 59% said the fear of losing money was the emotion that had the biggest influence on their tolerance for risk.

If investors cant afford to save more and arent willing to dial up the risk, then they may plan to work longer. Indeed, almost 30% of people surveyed by financial advisor Edward Jones said they plan to delay retirement because of the coronavirus pandemic.

The trouble with this strategy is that people can overestimate their capacity to keep working. The average retirement age in the US is 61 and has barely budged in recent years. Thats five years younger than the age at which people, on average, expect to retire, according Gallup survey data of adults over age 18. Some may leave the workforce earlier than expected because of health problems, or to a look after a family member.

Older workers who lose or leave their jobs may find it difficult to find employment again, sometimes because of age discrimination. In this recession, customer-facing jobs in the retail or hospitality sectors may not be an option for older workers because they face greater Covid-19 health risks than younger employees.

I suspect a lot of aspiring retirees think theyre going to be able to work longer than theyre able to, said Robert Williams, a vice president at the Schwab Center for Financial Research.

Not saving enough for retirement has long been a problem for many Americans, but Williams says ultra-low interest rates are shining a light on this concern. (In his view, the 60-40 portfolio isnt dead, but he argues the investment staple needs to be adjusted, potentially with company debt instead of government debt, or more exposure to the stock market.)

Ritholtzs Carson, meanwhile, suspects ultra-low interest rates will encourage financial institutions to start marketing exotic stufffinancial products that use derivatives or leverage, as demand grows for anything with a hint a extra yield. Mostly, though, he expects that many peopleare just going to have to work longer, whether they want to or not, and rely pretty heavily on Social Security.

Continued here:
With interest rates near record lows, retirement may have to wait - Quartz

Maurie Backman, The Motley Fool Published 6:00 a.m. ET Oct. 16, 2020

Health care is a major burden for Americans of all ages. For seniors, it's a giant concern. Many seniors live on a fixed income and tight budget, relying heavily on their Social Security benefits to make ends meet. It's not surprising to learn that 60% of seniors 65 and older who are enrolled in Medicare worry about their ability to afford health care, according to a MedicareGuide.com survey. In fact, 50% of people in that age group fear that a major personal health crisis could lead to serious debtor even bankruptcy.

What's equally concerning is that 24% of older Americans say they'd need to use a credit card to pay for a severe illness. Meanwhile, 32% say they'd tap their retirement savings to cover that cost. The latter isn't terrible per se the whole point of having money in an IRA or 401(k) is to be able to spend it on any retirement expense that arises, health care included. But there's actually a better way for seniors to pay for health care and avoid debt at a time in their lives when they really can't afford it.

While padding an IRA or 401(k) during your working years could help ensure that you have enough money to pay for your future health-related needs, there's an even better account for that purpose: the health savings account.

An HSA actually offers more tax benefits than an IRA or a 401(k). Your contributions go in tax-free, the growth is tax-free, and the withdrawals are tax-free (provided they're used to cover qualified medical expenses).

Planning: From assessing income sources to asset allocation, here are 6 easy steps to retirement planning

401 (k): A $5,500 withdrawal from your 401(k) could cost you $30,000

The beauty of HSAs is that their funds don't expire. You can contribute to an HSA at age 30 and withdraw money year by year as needed to pay for your near-term medical expenses. Any money you don't use can be invested and withdrawn later on. In fact, it pays to overfund your HSA year after year, putting in more money than you expect to use immediately so you have the option of carrying funds all the way into retirement. Having an HSA at that stage of life could spare you from debt or bankruptcy in the event of a serious illness or expensive hospital stay.

(Photo: Getty Images)

Shockingly, in the aforementioned survey, only 2% of respondents said they'd pay for a severe illness with HSA funds, suggesting many retirees today don't have one of these accounts at their disposal. If you have the option to participate in an HSA, it pays to not only take advantage, but to also contribute the maximum amount allowed.

Not sure how much to contribute to your 401(k)?: Make sure to get your full employer match.

For the current year, you can contribute up to $3,550 to an HSA for individual coverage and up to $7,100 for family coverage. Next year, these limits will increase to $3,600 and $7,200, respectively. If you're 55 or over, you can contribute an extra $1,000 on top of whichever limit applies to you.

Serious illnesses or injuries can strike at any time. In fact, 32% of seniors say they've had to grapple with a surprise medical bill over the past two years. The best way to tackle all your health care expenses in retirement is to have a dedicated source of funds at the ready to pay for them. If you play your cards right, an HSA could be your ticket to financial security even as your peers risk severe debt or bankruptcy.

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60% of Medicare enrollees worry about health care costs. Here's the best way to pay for them in retirement - USA TODAY

In recent times, the economic turmoil caused by the Covid-19 pandemic has affected retirement plans for many Americans. And infection rates vary in different parts across the country, introducing new stressors and changing daily life.

So given all that, what are the best places in America to retire? On Tuesday, U.S. News & World Report released its list of the best places in the United States to retire for 2020 and 2021.

The top destination, according to the survey? Sarasota, Florida.

To determine the best places to retire, in August, U.S. News surveyed more than 3,000 people who were either approaching retirement age (45-59) or at it, about the factors they consider important in a retirement destination.

Based on those responses, they scored the 150 most populous metropolitan areas based on six indexes: housing affordability, happiness, desirability, retiree taxes, job market and health care quality. Each place was given an overall score out of 10 points.

These are the top five best cities to retire in 2020 and 2021, according to U.S. News:

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Known for its spacious farms and Amish communities, Lancaster, Pennsylvania, about an hour west of Philadelphia, was the fifth-best place to retire this year, with a score of 7.4 in the retirement index. In 2018, Lancaster came in first place in U.S. News' retirement ranking. This year, Lancaster got top ranks in health care and housing affordability, with a median home price of $215,975.

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The "Sunshine State"is a popular retirement spot for reasons beyond the year-round sunny weather. Naples, for example, which is on the Gulf of Mexico in southwest Florida, got an overall retirement score of 7.4 out of 10. Homes are less affordable in Naples than other Florida cities, with a median price of $326,000. That said, Naples and other Florida municipalities have a "homestead tax exemption" for permanent residents, which decrease a property's taxable value by up to $50,000.

Jeff Greenberg | Universal Images Group | Getty Images

Port St. Lucie, Florida which is located between Miami and Orlando, and north of Palm Beach took third place in U.S. News' retirement ranking, with an overall score of 7.4. The reason? High scores in affordable housing and health care. (Port St. Lucie scored slightly higher than Naples in these two categories.) Sports fans might know Port St. Lucie as the spring training site of the New York Mets, and the home of the PGA Center for Golf Learning and Performance. In 2019, Port St. Lucie was ranked the fifth-best place to retire by U.S. News.

Philippe TURPIN | Photononstop | Getty Images

Though Fort Myers, Florida took the top rank of retirement destinations in 2019, this year it moved to second place with a score of 7.4. The Southwest Gulf Coast city has high scores in housing affordability (6.5), with the median home costing $226,825. However, it only scored 5.9 for healthcare. Lee County, where Fort Myers is located, has 21,331 cases of Covid-19.

Pola Damonte via Getty Images | Moment | Getty Images

With an overall score of 7.6, Sarasota, Florida was the top-ranked place to retire, up from second place last year. The "Circus City" which is located in southwest Florida, was ranked very high in housing affordability, with a median home price of $227,754. Sarasota also received a score of 6.4 for healthcare. (Sarasota County has reported more than 8,600 cases of Covid-19.) The city of 785,997 people is very popular among older adults; 31% of residents are over 65, and the median age of residents is 52.

Although Florida and other Southern states claimed many of the top spots in the U.S. News ranking, Ann Arbor, Michigan, home of the University of Michigan, came in seventh place with high scores in health care. Elsewhere in the Midwest, Grand Rapids, Michigan, the second-largest city in Michigan, was ranked within the top 25. And in New England, Manchester, New Hampshire, which is an hour from Boston, Massachusetts, came in 14th place with a score of 7.0.

To see how your city measured up, visit U.S. News for the full listing.

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Retail REITs are among the many ways to gain exposure to real estate without becoming a landlord. Here, a strip mall parking lot in Marlboro, N.J. Michael Loccisano/Getty Images

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What role should REITs play in my FIRE portfolio?

To achieve financial independence before traditional retirement age, you need a portfolio that includes investments that can provide large returns, particularly during an economic downturn. So its no surprise that many FIRE adherents turn to real estate as a key element in their financial planning.

Yet while many look to become landlords for the steady income and growth potential, a high bar to entry means property ownership isnt for everyone, says Angela Palacios, a financial planner and director of investment at the Southfield, Mich.-based Center for Financial Planning, where she oversees asset allocation for $1.2 billion in client portfolios.

Barrons brings retirement planning and advice to you in a weekly wrap-up of our articles about preparing for life after work.

Instead, she recommends real estate investment trusts for FIRE investors to access the returns that rental properties can offer, without the overhead or legwork required to be a landlord. REITs blend the ability of owning real estate with the convenience of purchasing a stock, she says.

REITs are companies that generate income through rental properties, which are often commercial. For example, a company might own and manage multiple strip malls, apartment complexes, or industrial properties. Publicly traded REITs are bought and sold much like stocks, giving shareholders access to a percentage of the rental income that those properties generate.

REITs are required to pay out at least 90% of their annual taxable income to investorstranslating to largely consistent, and potentially large, dividends. That income can help prevent a FIRE investor from drawing on accounts that he or she is banking on for the long term. And if the income isnt needed yet, the dividends can be reinvested to help boost savings.

On average, REIT dividends tend to hover around 4%. So, theyre naturally appealing when interest rates are down and investors are looking for something with decent yields, Palacios says.

But beware of using REITs in place of corporate or government bonds in your portfolio, she says. REITs are often more volatile than bonds, so Palacios recommends treating them more like a part of your stock portfolio. You can hold them in a taxable brokerage account, but a tax-deferred account can allow an investor to shelter returns, which may be particularly appealing to those in a high tax bracket.

Palacios generally makes sure clients have exposure to REITs through REIT mutual funds or exchange-traded funds. Both options provide diversification, which can be particularly beneficial in an uncertain economy. A simple and inexpensive ETF that Palacios recommends is Vanguard Real Estate ETF (ticker: VNQ), which is based on a U.S. REIT market index .

If choosing to invest in an individual REIT on your own, make sure to seek out impartial sources of information, Palacios says. She recommends researching on the Securities and Exchange Commission website or Morningstar.com, both of which can provide the valuation metrics needed to make an informed investment. If youre not sure what to look for, start with paying attention to the analyst comments and a REITs price versus fair value ratings. Undervalued REITs are priced below their fair value.

While Palacios deals only with publicly traded REITs, some investors do seek out a broker to help them purchase privately held REITs. Investors should beware that private REITs may be available only to accredited investors who either have at least $1 million in net worth (excluding their primary residence) or who have earned over $200,000 per year for the past two years. They dont provide the same liquidity as publicly traded options. They may also have high buy-in fees, and because theyre privately held, they arent required to publish the same information on their performance.

REITs offer FIRE investors a potentially strong passive income stream. Some investors may still prefer buying whole properties themselves, for the hands-on aspect and financial benefits of being a landlord. Either option can work, if you know what youre looking for, Palacios says. Youre building your wealth, so whatever will give you the return you need to help you reach your goals may be worth considering.

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Forget the Rent, Collect the Yield: Why Investors Looking to Retire Early Should Consider REITs - Barron's

Coronavirus is changing when and why workers are retiring. FOX Business Gerri Willis with more.

Making your retirement money last is imperative to enjoying financial security in your later years. Unfortunately, far too many retirees make major mistakes that could leave them at risk of running short of cash. Here are four big errors that could leave you broke.

THE 5 MOST IMPORTANT RETIREMENT QUESTIONS

To make sure your retirement money doesn't run short, you can't afford to drain your account too quickly. Taking too much money out impairs the ability of your money to work for you. When you have too little invested to earn reasonable returns, your accounts will empty out fast.

To make sure this doesn't happen, decide on a safe withdrawal strategy that makes sense for you. Experts recommended the4% rulefor years, but with interest rates so low now and life spans getting longer, this approach leaves you at serious risk of running short.

HALF OF RETIREES WISH THEY'D BUDGETED MORE FOR THIS

TheCenter for Retirement Researchat Boston College instead recommends calculating your withdrawal rate based on tables the IRS prepares to help you figure out required minimum distributions. If you want to simplify things, though, you could always just decide on a lower withdrawal rate, such as taking 3% of your account balance out in the first year of retirement and then adjusting withdrawals to keep pace with inflation each year thereafter.

As a retiree, you need to maintain the appropriateasset allocation. If you invest too conservatively because you're scared of incurring losses, you could earn very low returns, causing your nest egg to dwindle too fast. On the other hand, if you're overexposed topotentially volatile stocks,you could experience outsize losses.

To make sure you have the right mix of investments, subtract your age from 110. Invest that percentage of your portfolio in the stock market (so the portfolio of a 70-year-old, for example, would have 40% in stocks) and the remainder in safer investments, even though they have a lower potential return on investment.

3 SOCIAL SECURITY BASICS EVERY INVESTOR MUST KNOW

Investment fees eat away at returns throughout your working life, but they can become an especially big problem when you're on a fixed income and every dollar counts.

Today, most brokerages offer $0 commissions on stock trades, so you shouldn't pay a fee to buy or sell investments. And carefully review management fees for any funds you invest in. If you work with a financial or investment adviser, you'll also want to understand the adviser's fee structure upfront and make sure it's reasonable and worth the money.

THIS LESSER-KNOWN RETIREMENT SAVINGS TOOL IS LOADED WITH TAX BENEFITS

Health care is one of the biggest expenses retirees face, with the Employee Benefit Research Institute estimating a senior couple in 2020might need as much as $325,000to cover out-of-pocket health care costs throughout retirement. And that doesn't even take long-term care into account.

You should cover health care throughout the entirety of your career by saving money in a health savings account (HSA) or earmarking some 401(k) or IRA funds for your medical needs. If you haven't done that, try to save an emergency fund for medical care, shop around for the most comprehensive insurance coverage you can find, and consider long-term care insurance.

Now you know how to avoid these mistakes that could drive you broke, so hopefully, you can enjoy a financially secure retirement.

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4 good ways to go broke in retirement - Fox Business

If you decide that your primary income source during retirement will be none other than Social Security, whose meager raises barely allow seniors to keep up with inflation, then you may be in for a financial shock once you leave the workforce behind. But if you make an effort to save independently and save well, then you'll lower your risk of winding up short.

How much money should you set aside for retirement? A good rule of thumb is to aim to sock away 15% to 20% of your earnings (more if possible) in a 401(k) or IRA. Furthermore, you'll want to invest your savings aggressively for maximum growth, and that means loading up on stocks, especially when you're younger and retirement is a good number of years away.

The amount of savings you're able to amass in time for retirement will depend on how early you start building your nest egg and how well your investments perform. But here's a snapshot of the wealth you might build if you give yourself a 35-year savings window and go heavy on stocks in your portfolio:

Monthly Contribution

Ending Balance After 35 Years atAverage Annual 7% Return

$200

$331,800

$400

$663,500

$600

$995,300

$800

$1.33 million

$1,000

$1.66 million

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Americans Are Facing a $3.83 Trillion Retirement Shortfall. Here's What to Do About It - North Platte Telegraph