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January 13, 2017

Penelope WangThis week Congress moved a step closer to repealing the Affordable Care Act. Republicans say they will replace Obamacare with a better plan, but so far there’s little clarity on what that will be or when it will happen. For older workers who are not yet eligible for Medicare, it’s best to be cautious right now about taking early retirement or changing jobs if you will lose employer coverage. For those with job-based health insurance, be aware that a repeal of Obamacare affects you too, since many protections may be changed, including access to coverage if you have a pre-existing condition, free preventive care, and the law’s prohibition of lifetime and yearly dollar limits on benefits. (For more on unexpected fallout, see this article.) Still, there’s a possible silver lining: Upper-income Americans may get a nice tax break. Meanwhile, our best advice is to buy coverage now if you need it—the deadline to sign up for this year is Jan. 31. Get it while you can.

Best wishes,

Penny

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THIS WEEK’S RETIREMENT NEWS, INSIGHTS AND ADVICE

Investing Guru Jack Bogle’s One Piece of Advice for 2017

With January nearly half over, your financial resolutions may not be going so well. Don’t beat yourself up. Instead, consider Vanguard founder Jack Bogle’s advice, which focuses on what not to do, as well as other tips from experts. MONEY

The 7 Ages That Matter Most in Retirement Planning

If you’re a boomer or Gen Xer, pay attention: You need to put some important dates on your calendar. When you reach key ages, IRS rules allow you to save more in retirement plans as well as tap your accounts without penalty, if needed. You also need to be aware of important dates for claiming Social Security and Medicare. Check out the rules. FORBES

How to Fund a Long Retirement

One of the biggest challenges in retirement planning is getting a handle on your lifespan. Longevity has been increasing, which means that you and your spouse are likely to live longer than previous generations. So unless you’re planning for those extra years in retirement, you may face a savings shortfall. Writer Robert Powell reviews the numbers. MARKETWATCH

Why Dow 20,000 Is a Meaningless Milestone

This week the Dow Industrial Average nearly reached 20,000, and when it does cross that level, it will be viewed as an historic event. Hold the applause. As contributor Walter Updegrave explains, hitting 20,000 will have psychological significance. But for your retirement portfolio, other investing factors matter a lot more. MONEY

Unconventional Investments Can Put Your IRA at Risk

If you hold alternative investments in your IRA—real estate, gold, private equity, and the like—you may be jeopardizing your savings. A new report by the General Accounting Office found that many IRA investors don’t understand the tax treatment of these assets or the difficulties in assessing their value, says writer Greg Iacurci. Make sure you’re not one of them. INVESTMENT NEWS

What to Do With Unneeded RMDs

It’s a nice problem to have: You’re 70 1/2 or older, and you have to take your required minimum distributions (RMDs)—but you don’t need to spend them yet. What to do with the money? Morningstar’s Christine Benz offers options. Preview: If you’ve got grandkids, consider a 529 plan. MORNINGSTAR

Working ‘Til You Die Is a Lousy Financial Plan

Millennials have a bleak outlook about retirement, a recent survey found. One in eight say they’ll work until they die, or at least until their 80s. As contributor Dan Kadlec points out, that attitude probably stems from skepticism about the future of Social Security. Truth is, young workers are far more likely to collect Social Security benefits someday than to keep working in their 80s. In any case, planning not to retire is no excuse to skimp on saving. MONEY

The Best Way to Age in Place

Of course, many older Americans don’t want to move. And as growing numbers of seniors age in place, naturally occurring retirement communities (NORCs) are springing up around the country. This deep dive into NORC living finds it can work well, especially if the area is walkable and offers services, but health care is a challenge. It’s worth a close read, if you or your parents expect to live in one someday. POLITICO

A Slower Pace for the Galloping Gourmet

If you watched TV back in the 70s (dating myself), you may recall the Galloping Gourmet, aka Graham Kerr. Prefiguring many later TV stars, he had a high-energy presence, leaping over chairs, and a casual approach to cooking, often done with wine in hand. Today, at age 82, he leads a calmer life, which offers lessons for us all. THE NEW YORK TIMES

YOUR RETIREMENT QUESTIONS ANSWERED

What Is a Target-Date Fund?

Q.: My employer automatically enrolled me in the company 401(k) retirement plan and put 100% of my money into a target-date fund. Is this safe? What exactly is it?

A.: Not to worry. These days most large employers auto-enroll new employees (and sometimes current workers) into their 401(k) plans to get people started on saving for later life. Your contributions are automatically directed into a default investment, which is typically a target-date fund. You can always opt out, or choose a different investment. But you are probably better off staying put, since a target-date fund is a great option, especially for investors just starting out. READ MORE

WORDS OF WISDOM

“Everyone has to make up their mind if money is money or money isn't money and sooner or later they always do decide that money is money.”

--Writer Gertrude Stein

ABOUT PENNY: Penelope Wang is editor at large at MONEY with a focus on retirement planning. A graduate of Swarthmore College and Columbia University School of International Affairs, she was recently ranked among the "top social influencers in personal finance and wealth." You can email her at retirewithmoney@moneymail.com and follow her on Twitter @PennyWriter.

 
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