An estimated 7 million Americans will reach the age of 65 by the start of 2013, and many will no doubt be thinking about retiring.
But even if falling off the "fiscal cliff' is avoided, some financial experts are warning anyone thinking about trading in their paycheck for a retirement fund next year.
"It's kind of a perfect storm in 2013 when you think about it," said Jason Wheeler, CEO of Pathfinder Wealth Consulting.
"With questions about taxes, spending cuts, the markets, health care—and then put those together with the number of seniors wanting to retire or will lose their jobs—the year could be a rough one when it comes to retirement," he said.
Topping Wheeler's worry list seniors are taxes.
"The magnitude of what a retiree will pay on their investments could really hurt their finances," he said. "And right now we don't know what that will be."
If no deal is reached to solve the fiscal cliff by Dec. 31, the Bush tax cuts end and rates go higher on capital gains and dividends.
As it stands now, the top tax rate on capital gains will jump to 23.8 percent from 15 percent and the top tax rate on dividends nearly triples to 43.4 percent from 15 percent. And any fiscal deal will likely include higher tax rates so seniors had better count on that when they plan for their retirement, said John O. McManus, CEO of McManus & Associates, a trust estates law firm.
Read more: http://www.cnbc.com/id/49827006
But even if falling off the "fiscal cliff' is avoided, some financial experts are warning anyone thinking about trading in their paycheck for a retirement fund next year.
"It's kind of a perfect storm in 2013 when you think about it," said Jason Wheeler, CEO of Pathfinder Wealth Consulting.
"With questions about taxes, spending cuts, the markets, health care—and then put those together with the number of seniors wanting to retire or will lose their jobs—the year could be a rough one when it comes to retirement," he said.
Topping Wheeler's worry list seniors are taxes.
"The magnitude of what a retiree will pay on their investments could really hurt their finances," he said. "And right now we don't know what that will be."
If no deal is reached to solve the fiscal cliff by Dec. 31, the Bush tax cuts end and rates go higher on capital gains and dividends.
As it stands now, the top tax rate on capital gains will jump to 23.8 percent from 15 percent and the top tax rate on dividends nearly triples to 43.4 percent from 15 percent. And any fiscal deal will likely include higher tax rates so seniors had better count on that when they plan for their retirement, said John O. McManus, CEO of McManus & Associates, a trust estates law firm.
Read more: http://www.cnbc.com/id/49827006
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