By Penelope Wang
October 7, 2016
Chad Griffith

If you’ve been investing for any length of time, you’re probably familiar with Jack Bogle, the legendary Vanguard founder who established the first retail index fund. Fans of Bogle and Vanguard’s ultra-low-cost funds have created an investing community, known as the Bogleheads, who meet once a year. My colleague, assistant managing editor Karen Damato, attended their most recent gathering and spoke with Bogle to get his advice for retirement investors. Spoiler: You have a lot of challenges right now. All the more reason to pay attention to Bogle’s money lessons, including sticking with inexpensive funds and keeping your investing as simple as possible. The good news: Following these principles will put you on the fast track toward achieving retirement security, as the Bogleheads can testify.

Best wishes,

Penny

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THIS WEEK’S RETIREMENT NEWS, INSIGHTS AND ADVICE

A Retirement Crisis? There Are Actually Three, Says Vanguard Founder Jack Bogle

The retirement crisis is not a single problem, says Vanguard founder Jack Bogle. At a recent gathering of the Bogleheads investing community, the index fund pioneer outlined three different challenges, with Social Security funding leading the list. And he noted a positive development too. MONEY

Think Twice About Using Your 401(k) Brokerage Window

A growing number of 401(k)s offer brokerage windows, which let you invest in a wide range of stocks and funds. That’s great if you don’t like the plan’s regular options or if you like hands-on investing. But as reporter Darla Mercado explains, you may be taking on more risk than you realize. CNBC

Here’s How 40% of 401(k) Savers Build Bigger-Than-Average Balances

If you’re feeling a bit frustrated by the small amount in your 401(k) balance, there’s some encouraging news. Steady savers, who keep contributing to their plans year after year are building up six-figure nest eggs, reports Paul Katzeff. See how they’re doing it. INVESTOR’S BUSINESS DAILY

What Retirement Savings Rate Should Millennials Shoot For?

You may have seen a recent study that found young adults need to save 22% of income throughout their careers in order to retire comfortably. Maybe not. That figure is based on a dire view of Social Security, says contributor Walter Updegrave. Still, millennials—and older investors too—can benefit from these savings tips. MONEY

Is 4% Still the Safest Retirement Withdrawal Amount?

The 4% rule has long been considered a safe retirement withdrawal strategy: Take out 4% of your assets in your first year, and adjust that amount for inflation in subsequent years. But the prospect of lower returns has led many experts to ratchet that number down. Better check out their best advice now. US NEWS

Why Your Medicare Premiums Could Jump 20% in 2017

Low inflation isn’t just a problem for investors seeking yield—it will also limit next year’s Social Security cost-of-living adjustment. And as a result, Medicare premium costs will rise sharply for some beneficiaries—including those who have not yet claimed Social Security. Contributor Phil Moeller explains the ripple effect. MONEY

Tax Advantages of Qualified Charitable Distributions From IRAs

After you turn 70½, IRS rules let you transfer up to $100,000 from your traditional IRA to qualified charities. This can be a smart move if you have the dough to donate. Your charitable giving can reduce your taxable income, which may lower your tax bill and help you avoid a Medicare premium surcharge, as these tax experts explain. AAII

For Your Retirement Planning, Count on Living to Age 95

Making a retirement plan would be a lot easier if you knew how long you will live. But all you can do is take your best guess. So make it an informed one. As writer Robert Powell reports, the latest data show that Americans are living longer than ever. Take a look at the numbers and factor them into your plan. USA TODAY

A New Challenge Beats Relaxation

The notion of retirement has long been associated with kicking back and relaxing. Hey, we deserve a break. But writer Jonathan Clements points out that endless leisure can be a recipe for boredom—and, eventually, misery. So consider taking on new challenges that will prove satisfying. These three steps can get you started. MONEY

YOUR RETIREMENT QUESTIONS ANSWERED

What’s the Best Way to Keep My Retirement Mix on Track?

A constant theme for retirement is to check your ratio of stocks and bonds to be sure you are on the right track. When I do that, should I be selling one and buying the other to balance, simply changing my future allocations for contributions, or both? —Joe Knippel

You’re definitely right to ask about your asset allocation, says Jarrett Solomon, director at Connecticut Wealth Management in Farmington, Conn. Keeping tabs on your stock-and-bond mix is essential to maintaining a risk level that you can live with, as well as ensuring that you are on track to earning the returns you need. READ MORE

WORDS OF WISDOM

“People who refuse to rest honorably on their laurels when they reach ‘retirement’ age seem very admirable to me.”

–Actress Helen Hayes

 

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