The charitable giving of individuals with donor-advised funds increased last year to 272 gifts of at least $1 million, up from 185 in 2013, according to Fidelity Charitable. The number of donor-advised funds at the organization were also up last year, growing from about 64,000 in 2013 to 72,170 in 2014. 62% of people with donor-advised funds through Fidelity said they would continue to use their funds to donate to charities after retirement.
Kim Laughton, president of Schwab Charitable, discusses how donor-advised funds can benefit advisers as well as clients. She says advisers who make charitable planning a focus of their practices through donor-advised funds can deepen their relationships with clients.
For those who had planned to retire early but cannot afford to do so, some advisers say there's another option: a "practice retirement." Under the strategy, near-retirees stop funding their retirement but continue working. Meanwhile, they divert some of their savings into activities they planned to pursue in early retirement, such as travel. Because "practice" retirees can afford to delay Social Security benefits while still working, they will increase the income they receive later.
Some near-retirees and retirees can use home refinancing as a tool, getting rid of home debt faster in the current low-rate environment, experts say. In some cases, the amount that older Americans could save by refinancing is greater than what they would earn on an investment, advisers say.
A common question among retirees and near-retirees is how much of their savings they can tap each year without running out of money. There's no magic answer, writes Walter Updegrave, but four strategies, including the common 4% rule, can provide guidance.