CPAs: The Retirement Horizon is Changing for Your Clients

Filed under: The Advisor's Blog

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As your clients enjoy longer, healthier lives, they can also anticipate a longer retirement. People are still retiring around the same age that they always have, but most retirees today can expect to live twenty or even thirty years after they stop working. That’s a long time to live on a fixed income from a combination of Social Security or retirement plan distributions!

But in many cases, that isn’t even the plan. These days, more and more retirees are choosing to continue working in some capacity. Gone are the days of retiring from a long career with a single company, and playing golf for the rest of their lives. Retirees today enjoy better health and longer lives than previous generations, and most of them want to stay active and involved in the business world. They’re accomplishing this by transitioning into second careers, taking up consulting work, finding part time jobs, or even starting their own businesses. Most seniors enjoy the challenge of new and different work, and they’re certainly enjoying the paychecks as a supplement to their retirement income.

As a CPA, you are intimately familiar with your clients’ tax situations, and they will naturally turn to you for help with planning for taxes in retirement. But with retirement looking so different these days, you need to know more about their future plans before dispensing advice.

For instance, Social Security income can indeed be taxed, depending upon each retiree’s annual earnings. Income from retirement funds can also be taxed, depending upon the type of account and the individual’s overall tax bracket. In some cases, retirees who begin second careers in retirement can find themselves unpleasantly surprised by their tax burdens. It is imperative that your clients receive the right financial and tax advice as they are planning for retirement.

When you partner with a financial advisor who specializes in retirement planning, your clients receive the invaluable benefits of having a team of specialists at his or her side. Together you can help clients identify their own objectives for retirement, assess potential future income, and craft a plan to avoid excessive taxation in the future. By providing this service for your clients, you are going one step further toward helping them enjoy a secure future.

Investment Advisory Services offered through John P. Dubots Capital Management, LLC, CA License # 0822926