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Today's top trending stories

Read more about how the SECURE Act will change retirement savings, what Donald Trump said about his impeachment trial, and check out other stories trending online today.

Congress passes SECURE Act

A bill aimed at making retirement saving a bit easier is on its way to the president's desk for signing. While the bill will help some to save, especially those working part-time or at smaller companies, the bill is being criticized by some.

Read more about changes the SECURE Act will make from Money.com

Trump wants trial

While House Democrats hold up potential impeachment proceedings over concerns about how Republicans in the Senate will conduct the trial, President Trump wants a trial sooner than later, believing he will be exonerated.

Read more about what the president has said from the BBC

Democratic debate: Who won?

Last night featured the final debate in 2019 among those contending for the Democratic nomination for president.

See who won and lost at the debate according to NBC News

Bucks top Lakers

In what could be an NBA Finals preview, LeBron James and the Lakers lost to Giannis Antetokounmpo and the Bucks, 111-104.

Read more about the game from CBS Sports

Other headlines trending today

India extends controls on protests after day of deadly violence (CNN)

Wawa says data breach may have collected thousands of customer card numbers and names (CNBC)

Potential No. 1 pick in NBA Draft withdraws from Memphis to prepare (UPI)

All eyes in New England on Tom Brady's hurting elbow (FTW)

'Star Wars: Rise Of Skywalker' Feels The Force Thursday Night With Around $44M (Deadline)

Marvel Studios Rumored To Be Eyeing Emma Stone For A Major MCU Role (Brobible)

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Changes to retirement plans, Trump on impeachment & more: What's trending today - cleveland.com

Failing to withdraw a required minimum distribution (RMD) from your own or an inherited IRA by the deadline results in a big tax code penalty: 50%. That's right. If you were supposed to take out a minimum of $4,000 and (oops!) did not do so, you have the privilege of writing the IRS a check for $2,000.

Like many investors, you're likely aiming to build a comfortable nest egg to ensure a comfortable retirement. Among retirement financial planners, this is called the "accumulation phase." In this phase, your goal is to invest wisely by choosing stocks with long-term potential for your retirement portfolio, such as Ameriprise Financial Services (AMP), a current top ranked dividend stock.

There is also a second phase of retirement planning that gets less focus - despite the fact that it's the more interesting part. It's the "distribution phase," which essentially means spending the wealth you've worked hard to amass.

Making plans for the distribution stage involves deciding where you'll live in retirement, whether you'll travel, your proposed leisure activities, and more decisions that will affect your spending during your golden years.

Along with these aspects, it is important to consider the required minimum distribution (RMD) that applies to most retirement accounts. Essentially, the IRS requires you to withdraw a specific sum from your qualified retirement accounts once you hit age 72.

Why does the IRS requires you to start taking your money out? It's simple - they want to make sure they get their tax. If this rule didn't exist, people could live off other income and never pay tax on their retirement investment gains. Then, that money could be left to family or friends as an inheritance without the IRS collecting any taxes from you.

What You Need to Know About RMDs

Which types of retirement accounts have RMDs? Qualified retirement accounts like IRA accounts, 401(k)s, 457 plans and other tax-deferred retirement savings plans like a TSP, 403(b), TSA, SEP, or SIMPLE IRA plan require withdrawals in retirement.

When do I have to start taking distributions? For most accounts, you must take your first distribution by April 1 of the year following the calendar year in which you reach age 72.

Every year after your start date, you are required to take your RMD by December 31. Remember, for Roth IRAs you do not have to take an RMD because you paid taxes before contributing. However, other types of Roth accounts do require RMDs, but you may be able to avoid them (for instance, by rolling your Roth 401(k) into your Roth IRA).

What happens if don't take my RMD? The penalty for not taking a required minimum distribution, or if the distribution is not large enough, is a 50% tax on the amount not withdrawn in time.

How much money do I have to withdraw? To calculate a specific RMD, you must divide your prior year's December 31st retirement account balance by a "distribution period" factor based on your age.

Here's an example to give you an idea of the amount: Ann is 70 and will take her first RMD in the year she turns 72. Her IRA balance at the end of the prior year was $100,000. Her "distribution period" factor is 27.4. Dividing $100,000 by 27.4 equals $3,649.63. This is how much Ann is required to withdraw for the calendar year in which she turns 72.

Learning about the "distribution phase" is just one aspect of preparing for your nest egg years.

To learn more about the tax implications of retirement spending - and much more about retirement planning - download our free guide: Retirement Made Easy.

You???ll find useful, detailed steps to help you navigate both the accumulation and distribution phases of retirement planning. Get Your FREE Guide Now Ameriprise Financial, Inc. (AMP) : Free Stock Analysis Report To read this article on Zacks.com click here.

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Know These 3 Facts to Avoid Paying Half Your Retirement Income to the IRS - December 20, 2019 - Yahoo Finance

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KANSAS CITY, Mo. -- It's retirement day for one KCPD officer and his partner.

Now retired Officer David Edwards and his working dog Ike celebrated the milestone together on Friday. The pair have done most everything together, and now they can add retiring to the list.

"I've always liked dogs. It's always been fun, and started going out and volunteering working on my own time with them in the 90s, and wound up out there," Edwards said.

Edwards was with KCPD for 32 years, nine months and six days. He worked with dogs for nearly 30 years and had six partners. Ike the Belgian Malinois has been with him for seven.

Sgt. William Brown, Edwards' and Ike's supervisor, was sad to see them go.

"I think it's important because these dogs are our partners," Brown said. "They're with us 24 hours a day seven days a week. To see them grow together and leave together is really important."

Their badges were given to them in a shadow box in front of colleagues, family and friends. On the back of Edwards' badge is a heart sticker his daughter placed there more than two decades ago.

"Even as she got older it was still nice when you pinned a badge on another shirt. It was an immediate family connection," Edwards said.

"Sometimes you go through the day and you may not think about, 'Oh, I wonder what theyre doing.' When you put that on there its like, 'Man, I hope theyre OK. I gotta make sure theyre OK. I havent talked to them in a day or two.' So its a nice little reminder."

Edwards said he's going to enjoy a more slow-paced life with hunting, fishing and enjoying time with family, including his newborn granddaughter. However, he'll make sure Ike keeps busy.

"He never quits. He's going all the time," Edwards said. "He's searched a house three or four times in one setting. I can get him to lay down for 10 minutes, maybe, and then he's up searching the whole house again."

They're both reserve officers for the department now. David and Ike will be back when the department needs them, but for now they will have their cake and eat it, too.

"To watch them grow together and to watch them ride off into the sunset together, I don't think you could ask for anything more," Brown said.

"It was the best way to -- the only way to retire," Edwards said. "I can't imagine retiring without him. I don't think I would. I think I would keep working until he could retire."

39.099727 -94.578567

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The only way to retire: Kansas City police officer and his K-9 partner retire together - WDAF FOX4 Kansas City

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Portraits of retired and retiring judges unveiled - The Winchester Star

Dear Catey,

Im quickly closing in on 60 and will retire at the end of this year. I can spend about $2,500 a month in retirement. Im single, and my family lives on the West Coast. I prefer a cooler climate, proximity to an ocean and enjoy a community that supports the arts. Im not opposed to snowbirding to avoid extreme summer temperatures. I currently live in Alaska, and south has an undeniable appeal.

M.D.

Dear M.D.,

Im not going to lie: Finding a compelling spot to live on the West Coast so you can be near your family and the ocean might be a little tough to do with a budget of $2,500 a month. But I think Im up for the challenge. In other words: This winter could be decidedly less chilly for you!

Ive got a handful of places that are artsy, relatively affordable (at least for the West Coast) and within a few hours drive of the Pacific Ocean. Since youre single, you might be able to squeeze by on $2,500 a month in these spots, especially if you dont have much in the way of health care or other expenses, but I will say that youll need to keep a pretty tight leash on your spending to do so.

But before I dive in, I think its important for all readers to note that if you want to spend part of the year in a location like Alaska or Florida, both no-income-tax states, check the rules on how long you must stay in the state per year to maintain the tax advantage. (M.D., this article on Alaska snowbirds might be of interest to you.)

That said, whether you decide to spend part of your time in Alaska or not, here are some spots you might want to consider.

Olympia, Wash.

Like Alaska, Washington has no state income tax and its state capital, Olympia, has plenty of other perks you might like, too, including arts offerings. The Olympia Film Society showcases independent and classic films at the historic Capitol Theater, a city landmark. Art collectors wont want to miss the semiannual Arts Walk, featuring paintings, sculptures, photography and more, Kiplinger writes of Olympia, which it calls a smart place to retire. And should you want more in the way of arts, you can drive about an hour and be in Seattle.

If youre craving the beach, head to the 40-acre Kenneydell Park, which offers 1,000 feet of freshwater beach, plenty of trails to hike and a swimming area on Black Lake. Olympia also boasts a wine trail, a coffee trail and a university that welcomes older students.

Its certainly not dirt-cheap to live in Olympia (the cost of living is 13% above the national average, according to Sperlings Best Places most of that due to housing (the average one-bedroom costs about $930 a month to rent, for example). But the absence of a state income tax could give you a boost should you decide to work a part-time gig to supplement your $2,500 a month, and will help you keep more of the money you withdraw from any retirement accounts.

Eureka, Calif.

Its tough to do California on a budget if you want to be on the ocean, but Eureka fits the bill. Its got a cost of living thats only about 5% above the national average, according to Sperlings Best Places, and the average one-bedroom rents for less than $800 a month.

This sleepy seaport town at the northern end of the state is crowded with artists and dotted with quaint Victorian homes, I wrote back in 2012 when I recommended it for active retirees. And though its small (fewer than 30,000 people), there are interesting arts offerings, including monthly art walks, art galleries, food and music festivals, and more.

Temperatures in Eureka are relatively mild (its typically in the 50s and 60s) and there are myriad redwood trees, as those who hike and bike will surely discover. That said, there are some downsides to living here, including high property-crime rates and more than an average number of rainy days.

Medford, Ore.

This isnt the first time Ive recommended Medford to a retiree when 66-year-old Bill from San Diego got sick of Californias costs, I suggested he go here, too and theres a good reason for that. Medford is pretty affordable (with a cost of living about 9% above the national average) and has decent weather with mild temperatures and less rain than in other parts of Oregon.

Ashland is just 20 minutes by car from Medford and is known as an arts community (its home to the renowned Oregon Shakespeare Festival), but Medford, too, has its fair share of artsy stuff to do, including theater, art galleries and a dance-oriented arts center. Sperlings Best Places even calls it a cultural and residential crossroads between California and the Pacific Northwest.

Also, there are more than two dozen parks in Medford, and southern Oregon offers gorgeous hiking options, and Medford is an emerging wine region with a growing artisan food scene. One possible drawback is a relative lack of diversity in the area.

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Im 59, have $2,500 a month to spend and prefer an artsy community near the ocean thats not too hot where should I retire? - MarketWatch

Dear Liz: Im retired, 64 and delaying Social Security for a few years. I want to create a monthly stream of income from $850,000 in retirement funds. It may be needed to show a solid, dependable income so that I can get a mortgage. Is there any way to avoid the 20% federal and 7% state tax withholding? I do realize the amount I withdraw could trigger higher Medicare premiums in the future. The drawdown is $8,300 per month, which leaves me a spendable amount of $6,000.

Answer: Good for you for delaying the start of Social Security, but please get yourself to a fee-only certified financial planner before you tap any of your retirement funds. A 4% initial withdrawal rate from retirement funds is considered sustainable.

The amount youre contemplating would be nearly three times that. Even if youre withdrawing at that rate for a limited time, it could leave you without enough money later. And if this high withdrawal rate is the only way you can get the mortgage you want, you may be taking on more debt than you can really afford.

The certified financial planner also can help you with a tax strategy. Tax withholding on retirement income is usually voluntary, but paying the actual tax is mandatory.

The percentage you ultimately pay on the withdrawals will be based on your tax bracket, which could be higher or lower than the 20% federal and 7% state rates you cite.

Before you withdraw anything, you should have a good idea of what the tax bill will be and have plans to cover it. Those could include having the investment company withhold a certain percentage or making quarterly estimated tax payments.

You may have done well with a do-it-yourself approach up to this point, but there are many ways to mess up your finances unknowingly in retirement. Youd be smart to get expert help in creating a tax-efficient withdrawal strategy that maximizes your retirement income while minimizing the risk of running out of cash.

Liz Weston, Certified Financial Planner, is a personal finance columnist for NerdWallet. Questions may be sent to her at 3940 Laurel Canyon, No. 238, Studio City, CA 91604, or by using the Contact form at asklizweston.com.

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Liz Weston: Get professional help before withdrawing retirement funds - OregonLive.com

Traditional C.C.R.Cs operate under an assortment of contractual arrangements. Some have high buy-in fees, refundable to varying degrees after a residents death; others function more like rentals. Depending on luxury and geography, they tend to serve seniors who are financially comfortable.

Often, residents sell their houses to pay entrance fees that average $107,000 to $427,000, according to a report from LeadingAge, the trade association representing nonprofit senior care providers. (LeadingAge has rebranded these entities life plan communities.) Monthly fees range from $2,100 to $4,200.

Its a great solution for people who either have means or good retirement plans, some wealth built up, said Ruth Katz, senior vice president of public policy and advocacy at LeadingAge.

So far, the at-home programs carry lower price tags, though members still pay for housing and other living costs. At Senior Choice at Home in Florida, Mr. Ahmadi said, a 75-year-old would probably pay $55,000 to $60,000 in entrance fees and about $525 a month.

At Springpoint Choice, which has about 270 members in New Jersey and Delaware, initial fees run $30,000 to $65,000, with monthly charges of $300 to $500. All the fees are tax deductible.

If in a year they have a life-changing event, they could be paying $400 a month for skilled nursing, which on the East Coast typically costs $13,000 a month, Ms. Laidman said.

Ms. Basso joined Springpoint Choice at a bargain rate. Because she has good long-term care insurance, her entrance fee was a discounted $25,790; she paid it with the sale of her New Jersey house and her parents condo. Her $128 monthly fee has since increased to $146.

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A Retirement Community That Comes to You - The New York Times

Peter Dunn, Special to USA TODAY Published 6:00 a.m. ET Nov. 8, 2019 | Updated 1:37 p.m. ET Nov. 8, 2019

USA TODAY's Janna Herron explains the theory behind the FIRE movement - Financial Independence, Retire Early USA TODAY

Dear Pete,

I just retired at 60.I am a single, head-of-household male with no children.When I retired, my annual salary was about $120,000.I have had my mortgage paid off for about fouryears and have no monthly debt load.I have approximately $1.7 millionin investable assets.

The job I left offered no real pension once I retired.Even though I have taken a part-time job (sixmonths per year, very flexible consulting work ), I am still concerned about outliving my savings.Am I nuts to be concerned? Dean

Feeding Your Piggy Bank: This is how much the average American saves each year

Pete the Planner: I never tell a person not to worry, whether they should be worried or not.Were all wired differently. Instead, Im going to use our time together to illuminate apathto successand to help you identify some circumstances that could upendyour plans.

Im concerned youdidnt mention your current income. In fact, Ive convinced myself you dont know what it is. If thats the case, thats a problem. Sure, you likely make avariable level of income from your consulting gig, but how much is that and how does it set your lifestyle? If you make less, do you spend less?Or do you supplement an arbitrary amount of income with an arbitrary withdrawal from your nest egg?

Yournest egg, as youve acknowledged, is not a bottomless bowl of M&Ms grandma setsoutaround the holidays. Your dollars are finite. And if youwithdraw themindiscriminately, your fear of depletion is warranted.

Whether you like it or not, you need a budget.You must determine exactly how much all of your monthly obligations cost you.(Photo: Getty Images)

I can only assume you lived on your $120,000 salary and that standard of living has continued into your new retirement. You paid off your homeand your debt beforeretirement, which is fantastic. However, that doesnt necessarily mean you then setaside the money that previously satisfied those debts as savings on a monthly basis. If you didnt, then you increased your lifestyle heading intoretirement, which is common, but not great.

In fact, paying off major debts just before retirement can be incredibly dangerousbecauseof the risk of increased discretionary income increasing your lifestyle, heading toward a period of time (retirement) in which your available income is likely to decrease.

Additionally, if at retirement you becamesolelyresponsible for your health insurance premiums, then yourmonthly obligations increased the moment your income theoretically decreased. Assuming fullresponsibilityforinsurancepremiums for the first time in a long time can shock the system, and the wallet.

Whether you like it or not, you need a budget.

Earning Money After Retirement: Look for these three streams

You must determine exactly how much all of your monthly obligations cost you. Once youvefound this number, you have to ask yourself a very vital question Isthis sustainable? Ive convinced myself you dont know the number, and in turn, cant possibly confirmitsviability.

Forinstance, if you spend $6,500 per month consistently, then you must assign income to handle those expenses every month. If you simply spendwhatever feelsright, youll find yourself broke in a decade.

The importance of homing inon your true living expenses isespecially practical as you approach the age in which youll activate your SocialSecurity retirement benefits. Its not uncommon for a person whos been retired for a few years tounintentionally increasetheir lifestyle once Social Security income kicksin. This generallyhappens when a retireeoperates without a budget.

(Photo: Getty Images)

Look, I fully understand how unappealing budgeting is,especially once youve worked so long and hard to provide yourself an adequate retirement. But itsbecause youve worked so long and hard that you oweyourself the benefits budgeting provides.

Cure for loneliness?Alexa as your new bestie: Can an AI robot or voice assistant help you feel less lonely?

Even $1.7 million can disappear in arelatively short period of time if you refuse to budget. To replicate the lifestyle ($120,000 annually) youve just left behind in the workplace,youd need to withdraw 7% ofyour nest egg on an annual basis. That is not a sustainable plan. The more consulting income you earn, the less youll have to withdraw.

You also need to take the time to think through how your consulting income will wane. Will it gradually decrease over time as you purposefully put in fewer hours? Or will your income come to a screeching halt, whether it's voluntary or placed upon you. Too often, retirees who are working part time wrongly assume they alonedictate the continued viability of their part-time income strategy.

Thepiecesof a successful retirement are all there for you. Just be sure toassemblethemcorrectly.

Read or Share this story: https://www.usatoday.com/story/money/columnist/2019/11/08/retirement-possible-live-longer-than-your-savings/4122346002/

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Pete the Planner: Could a retiree outlive his savings even with a part-time job? Possibly. - USA TODAY

Early retirement is a dream shared by many but achieved by few. In fact, although half of U.S. workers say they'd like to retire by age 60, according to a survey from TD Ameritrade, only a third expect to be able to do so.

Retirement is expensive enough as it is, so if you want to be able to leave your job earlier than the traditional retirement age, you'll likely need to have a mountain of cash saved up to last the rest of your life. So when you picture what types of people can afford to retire early, you may be imagining doctors, lawyers, and other affluent professionals.

Image source: Getty Images.

However, new research shows a surprising reality: Workers who hold unskilled positions tend to retire earlier than their professional counterparts, and they also spend more years in retirement. But before you quit your job, there's more to the story.

This surprising tidbit comes from a report published in theJournal of Epidemiology and Community Health. Researchers spent over a decade studying citizens in the U.K. to find out how occupational social class and overall health affected the age at which workers retired. In part, they looked at the differences between those who worked unskilled jobs like cleaners, messengers, and manual laborers and those who worked professional jobs such as doctors, accountants, and engineers.

Ultimately, they discovered that those who held unskilled positions retired earlier, on average, than those in professional roles. Furthermore, these unskilled workers also tended to spend more years in retirement. In fact, unskilled workers in poor health still spent around five years longer in retirement than professional workers in good health.

That said, the study also revealed that the reason unskilled workers retired earlier usually had to do with health problems. The professional workers who spent fewer years in retirement did so because they were in better health and were able to work longer before retiring.

Early retirement is more common than you may think, and it's not always a positive thing. Roughly 43% of current U.S. retirees said they were forced into retirement earlier than they'd anticipated, a report from the Employee Benefit Research Institute found. When asked why they had to leave their jobs early, the most common responses included health issues and unexpected job loss.

If you have to leave your job earlier than you planned and your savings aren't retirement ready, your golden years may not be as enjoyable as you'd hoped. Especially if you're forced to retire due to health issues and can no longer work, you may have no choice but to make do on whatever you have saved -- whether you can actually afford to retire or not.

Some factors -- like health issues and unexpected job loss -- are out of your control, so you may not be able to avoid an earlier-than-expected retirement. But you can prepare yourself the best you can and protect your financial future.

One way to do that is to start building a robust retirement fund sooner rather than later. If your retirement strategy is to simply work into your 70s or 80s so you don't need to save as much now, your plans could be thrown out the window if you end up retiring before you're financially prepared. While it's not necessarily a bad thing to want to work past the traditional retirement age, make sure you have a backup plan in case you have to retire earlier than you anticipate.

A second option is to increase your Social Security benefits. Waiting to file for benefits until your full retirement age (FRA) will ensure you'll receive the full benefit amount you're entitled to. But if you wait until after your FRA to claim, you'll receive extra money each month in addition to your full amount. That boost can be significant, too -- those with a FRA of 67 can expect to receive an additional 24% each month by waiting to claim until age 70.

The downside to this strategy is that if you're forced into retirement in your early or mid-60s, you'll need to be able to survive on your savings alone until you're ready to claim benefits. But if you can swing it, you can collect fatter Social Security checks every month for the rest of your life.

Early retirement can either be a dream come true or a nightmare, depending on your financial situation. While you can't know whether you'll be forced into an early retirement or not, you can protect your finances to give yourself the best shot at retiring as comfortably as possible.

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Workers in These Careers Retire the Earliest, Study Says - The Motley Fool

Target-date funds (TDFs) can be fantastic retirement savings tools. Many are well-diversified, cost-effective, and automatically reduce risk for investors as they approach retirement.

Theres a problem though. Most hold bonds in their early years when young investors are protected from portfolio balance declines by relatively large contributions to accounts with relatively small balances. They also rarely include meaningful amounts of small-value asset classes which historically have improved returns over the long haul.

To offset this over-conservatism, we proposed a simple solution: multiply the investors age by 1.5 and use that as a percentage to invest in a TDF, then put the rest into an all-equity fund. In backtesting, this approach outperformed a pure TDF approach in more than 99% of the 576 overlapping 40-year periods tested, and only increased dips in portfolio balances (drawdowns) by 2% to 6%. Heres the summary data from that study. Please see that article for detailed descriptions.

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Here are the two funds you need before and after retirement - MarketWatch