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For Near Retirees, Taxes Are a Mystery: Idea File

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Financial professionals need useful, low-key ways to get prospects’ attention.

Near retirees are staggering through a blizzard of marketers’ efforts to get their attention.

Nationwide has come up with a possible way to shine a beam through all that snow: Tax tips.

(Related: 5 New Questions About How the Annuity Market Will Weather 2019)

The Nationwide Retirement Institute, a Nationwide affiliate, recently published the results of a survey of 1,031 U.S. adults ages 50 and older. Some of the questions were about taxes.

About 52% of the participants who were approaching retirement said they wished they knew more about how their income would be taxed in retirement.

About 40% of the near-retirees said they did not know what changes in their tax bracket might do to their post-retirement tax bills.

Eric Henderson, president of Nationwide’s life insurance business, said in an interview that the answers to the tax bracket question surprised him.

Many near retirees “really don’t know much about taxes in retirement,” Henderson said.

If near retirees don’t know how tax brackets work, “what else don’t they know about?” he asked.

Financial professionals who are not tax advisors cannot give tax advice, but they can give basic, general information about how post-retirement taxes work, and they may be able to find other strategies, such as teaming up with accountants, to get near retirees’ attention by offering them important, useful tax information, Henderson said.

— Read 5 LTC Thoughts From a Top Nationwide Executiveon ThinkAdvisor.

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