Planning to Retire
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Most Retirement Savers Aren't Exiting the Stock Market
Continue reading… 2 CommentsIt's easy to issue the empty threat that you're going to pull your retirement stash out of the stock market. But most nest eggs aren't mattressbound. An admittedly preplunge Gallup poll released today found that, among the 61 percent of Americans who have money in stocks, 70 percent have not seriously considered withdrawing from the market. Some 20 percent have seriously considered moving to safer investments, but only 8 percent have actually taken money out.
TIAA-CREF, which provides financial services to people in the academic, medical, and cultural fields, says call volume from clients is up 50 percent from this time last year. "Everyone is so afraid. They get nervous and might call and say, 'I want to take all of my money out of stocks,' " says Jeannette Innocent, a TIAA-CREF wealth management adviser in Waltham, Mass. But Innocent, who says she often feels like a psychologist as well as a financial adviser, reassures clients that the portfolios of most individuals aren't tanking as fast as the stock market as a whole, if they have solid diversification and an appropriate risk level. "I'm talking to people who may only be down 5 or 6 percent," she says. "Some clients who are more aggressive may be down 8 or 9." Innocent says only four of her approximately 200 clients have pulled out of the market and put their money in FDIC-insured CDs after talking to her.
Gallup asked on September 26 and 27, "Which of the following do you think is the best long-term investment?" Almost a third of Americans chose safe, low-return financial vehicles that will be lucky to outpace inflation. They responded: savings accounts/CDs (31 percent), real estate (26 percent), stocks/mutual funds (23 percent), and bonds (13 percent).
Have you changed your investment strategy in the past few weeks?
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Commemorating Teacher Retirement on Facebook
Continue reading… 0 CommentsAlmost everyone has teachers they fondly remember from high school or elementary school. But do you keep in touch with them? Do you even know if they are still teaching? Enter Facebook. At least two dozen groups have formed to commemorate the retirement of a favorite teacher.
Evan Cobb, 28, a communications director in New Haven, Conn., formed a Facebook group to contact former students of his mother, global studies teacher Sue Cobb, 59, of Fredonia, N.Y. "I wanted to let people know that she was retiring and have them provide stories about her. Within about 24 hours, we had 100 members," says Cobb. The group currently has 320 members. "By the time we got to her retirement party, I'd gotten about 80 or so messages from students—testimonials about the difference that she made in their lives," says Cobb. He collected the stories in a binder and presented it to his mother at her retirement party. Sue Cobb retired this year and has since joined the group.
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How the Washington Mutual Takeover Will Affect Consumers
Continue reading… 117 CommentsThe government seized banking giant Washington Mutual last night and then sold some pieces of it to JPMorgan Chase for approximately $1.9 billion. Here is how this will affect former Washington Mutual consumers:
What will happen to my bank account?
If you had an account with Washington Mutual Bank yesterday, you now have an account with JPMorgan Chase Bank. All deposit accounts, including savings, checking, money market, and retirement accounts and certificates of deposit, have been transferred to JPMorgan Chase Bank. No depositor has lost any money, even if it was above FDIC insurance limits. Direct deposits and Social Security checks will continue as normal. -
Sarah Palin's Parents Kill Rats in Retirement
Continue reading… 17 CommentsMany retirees would like to continue to do interesting work in retirement. Vice presidential nominee Sarah Palin's parents got part-time jobs as wildlife specialists for the U.S. Department of Agriculture. Chuck Heath, 70, a retired science teacher, and Sally Heath, 67, a retired secretary, travel throughout Alaska trapping or killing animals, often in remote locations. They sometimes travel for assignments to other parts of the country as well.
The Associated Press reports:
They've eradicated rat infestations, shooed geese from runways, and killed foxes that were keeping threatened Canada geese from nesting. In January 2002, they went to New York City for a two-week assignment that fit their specialty. Their job was to make sure birds and rats did not disturb the debris from the collapsed World Trade Center towers that was being searched by forensic teams for human remains in Staten Island's Fresh Kills landfill. They used snap-traps to catch mice and rats and pyrotechnics to scare off the gulls. If the birds persisted, the couple shot them as a last resort, Chuck Heath told the Associated Press on Thursday.
Heath said he was happy to leave New York and get back to Alaska. He complained to the New York Times about the heavy traffic. "I'm a country boy," he said.
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100 Years Old and Still Going to Work Every Day
Continue reading… 5 CommentsRetirement experts tell us we should try to work until age 70. Some seniors choose to work even longer. Experience Works, a nonprofit organization that helps older workers find jobs, recently honored an outstanding older worker in each state. I asked the three oldest for the secret to working past age 90.
Jack Borden, 100, only hinted at the answer. "I have a little wooden plaque on my desk that someone gave me. It says, 'Diplomacy is the ability to let someone else have your way,' " says Borden, who works about 40 hours a week as an attorney in Weatherford, Texas. The former FBI special agent has practiced law for 73 years, doing mostly real estate and probate work. "I must like it or I wouldn't still be doing it," says Borden. "There's a lot of people I can help without charging them a lot of money." Borden began working on the family farm at age 5. "By the time I was 10 years old, I was tying four mules to a grinder cutting grains," he says. The high school dropout went back to school for a law degree, graduating in 1936. "The experience is really the educator, and the more experiences you have, the better you are at any job," says Borden. "You are just now getting to the age when you are really worth your money."
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The Most Common 401(k) Features
Continue reading… 0 CommentsEvery company's 401(k) plan is slightly different. Some businesses offer more lucrative company matches and more diverse investment choices than others. A national survey released today examines what the typical 401(k) looks like. Here are a few of the highlights.
Company Contributions. Employer deposits into 401(k) plans averaged 3.2 percent of pay, according to a survey of 1,011 plans with 7.4 million participants and more than $730 billion in plan assets by the Profit Sharing/401k Council of America. The study represents 401(k)'s in 2007. The most common 401(k) recipe is a fixed match, which is present in 24.8 percent of plans. Among those with fixed matches, the most popular formulas are 50 cents per dollar up to the first 6 percent of pay (26 percent of plans), one dollar for every dollar up to the first 4 percent of pay (10 percent), and dollar for dollar up to the first 3 percent of pay (8 percent).
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The 10 Best Employers for Workers Over Age 50
Continue reading… 1 CommentIvy League colleges don't only top U.S.News & World Report ' s annual college rankings. Now, one of the eight elite institutions was also named a great place for older workers to intermingle with younger scholars. Cornell University topped this year's list of the best employers for workers over age 50, produced annually by AARP.
Cornell was recognized in part because of its innovative health-related programs for employees, including health screenings in office buildings on campus, computerized and in-person health counseling, weight-loss workshops, nutrition classes, stress-management programs, and other classes for older adults with titles like Staying Strong, Gentle Yoga, and Core Conditioning. The university also provides access to five fitness centers on campus, an ice skating rink, and several swimming pools. Picking a healthy place to live and work can greatly improve the quality of life in your golden years.
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The 10 Best International Employers for Older Workers
Continue reading… 0 CommentsFor the first time this year, AARP has added international employers to its annual ranking of great employers for older workers. The list, which spans only four countries—almost all of which are in Europe—highlights practices that make it easy for older workers to stay on the job.
International Employers That Welcome Older Workers
- Agewell—Sandwell Primary Care Trust, West Bromwich, United Kingdom
- Alexandra Hospital, Singapore
- BT Group PLC, London
- Centrica PLC, Windsor, United Kingdom
- Deutsche Bahn AG, Berlin
- Domestic & General Group PLC, Nottingham, United Kingdom
- Horsens Kommune, Horsens, Denmark
- Loewe AG, Kronach, Germany
- SICK AG, Waldkirch, Germany
- Singapore Health Services Pte Ltd., Singapore
Source: AARP, 2008
Tell us, have you considered working abroad in retirement?
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How to Retire During a Financial Crisis
Continue reading… 10 CommentsOlder Americans with their nest egg in the stock market right now may be watching secure retirement dreams crumble before their eyes. Retirees and baby boomers near retirement age may have lost a hefty chuck of their savings at an age when many have little time or ability to recover.
Avoiding and recouping large financial losses is a long and tedious process without a quick fix. Strategies advanced by financial advisers and retirement experts include delaying retirement until the market improves, reducing withdrawals from retirement accounts for a few years, leaving your asset allocation intact and hoping the market corrects itself, or changing your investment allocation to become more conservative as you age.
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Study: Falling Housing Prices Are Jeopardizing Retirement Security
Continue reading… 4 CommentsFalling housing prices can make it almost impossible to get out from under a mortgage you can no longer afford. A new AARP Public Policy Institute analysis says depressed home values are hitting baby boomers and seniors harder than other age groups. Americans over age 50 with homes worth less than their mortgage have a foreclosure rate approximately double the national average, AARP reports.
Foreclosure rates overall on first mortgages are higher for younger borrowers than for those over 50. But older households approaching retirement or already on a fixed income have less time to recover financial losses associated with foreclosure. Some 684,000 Americans ages 50 or older were either delinquent (30 to 180 days late), in foreclosure, or had lost their homes during the six months ending in December 2007, which represents 28 percent of all delinquencies and foreclosures.
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Forgetting: Is It Aging or Alzheimer's?
Continue reading… 4 CommentsEveryone forgets their keys occasionally, gets lost sometimes, or just can't quite remember the name of someone they were introduced to in the past. Young people usually shrug off these temporary bouts of memory loss. But older people may wonder if it could be the beginning of mild cognitive impairment or even Alzheimer's disease. U.S. News asked William Uffner, medical director of the Friends Hospital Older Adult Program in Philadelphia, how to tell when memory loss is a normal sign of aging or something more serious. Excerpts:
How do you know what's normal (like forgetting your keys) and when things are growing more serious?
The brain is unable to recognize when something is wrong with it. People generally are not aware when they have crossed over from a mild memory problem into dementia. More often, it is going to be a family member or an associate or someone else who makes the realization that a person isn't appropriately functioning and managing their affairs anymore. The individual themselves is likely to call the bank and say the bank made a mistake. That's a sign of true cognitive decline. -
Ideas for the Risk-Averse Saver
Continue reading… 3 CommentsThe key to weathering any financial storm is having a reserve of completely safe and accessible cash. This emergency fund can be tapped for unexpected expenses so that your nest egg and other long-term investments can accrue completely intact. Even money market funds, long touted by financial advisers and financial services companies as relatively safe investments with decent yields, may be trending downward. On Tuesday, the Reserve Primary Fund—a giant money market fund—saw its shares "break the buck," which means each $1 share is now worth only 97 cents. This is reportedly the first time investors will lose money held in a money-market fund.
Here's a look at some risk-free savings options.
FDIC-insured accounts. Checking, savings, certificates of deposit, and money-market deposit accounts are insured up to $100,000 per depositor, per insured bank. Certain retirement accounts, such as individual retirement accounts, are insured up to $250,000. Multiple accounts at the same bank, such as a CD and a checking account, all count toward the same $100,000. But $100,000 accounts at two different banks would each be fully insured. Couples with joint accounts can get up to $200,000 in coverage. Mutual funds, annuities, life insurance policies, stocks, and bonds are not insured. If a bank should fail, the FDIC pays out the amount you are insured for within a few days by establishing an account at another insured bank or providing a check.
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How Safe Is Your Brokerage Account?
Continue reading… 0 CommentsWhen a brokerage firm fails, customer assets are usually still safe—up to a point. All brokerage firms that do business with the public are required to be members of the Securities Investor Protection Corp., a nonprofit organization that provides some insurance to investors if the firm becomes insolvent.
SIPC covers the replacement of missing stocks and other securities up to $500,000, including $100,000 in cash claims. Investors typically receive their assets in one to three months once liquidation is initiated. The cash comes from a reserve fund authorized by Congress specifically for investors at failed brokerage firms.
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Baby Boomer Drug Use
Continue reading… 4 CommentsEfforts to curb illegal drugs often focus on the young—with good reason. While more than 20 percent of 18-to-20-year-olds used illicit drugs last year, only about 6 percent of 50-to-54-year-olds did.
But illegal drug use among young people is decreasing. Cocaine and methamphetamine use among young adults dropped over the past year, according to a recent report, although abuse of prescription drugs is on the rise. Meanwhile, there has been a spike in illicit drug use among baby boomers.
The Substance Abuse and Mental Health Services Administration 2007 survey on drug use found that the rate of illicit drug use in the past month among those ages 50 to 54 increased from 3.4 percent in 2002 to 5.7 percent in 2007. The confidential survey of 67,500, which included in-person interviews conducted in respondents' homes, found that among those between the ages of 55 and 59, illicit drug use more than doubled from 1.9 percent in 2002 to 4.1 percent in 2007.
The authors of the report say these trends may partially reflect the aging into these age groups of the baby boomers, whose lifetime rates of illicit drug use are higher than those of older age groups.
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How the Merrill Lynch Acquisition Will Affect Your 401(k)
Continue reading… 8 CommentsBank of America is acquiring Merrill Lynch for $50 billion. U.S. News asked three financial advisers what this means for Merrill Lynch customers and all 401(k) investors. Excerpts:
Steven Dimitriou, a financial adviser and managing partner at Boston's Mayflower Advisors
All 401(k) investors: Strictly as an investor, there is no doubt today's news is awful. It is hurting the markets. But if you have a long-term plan for the next 15 to 20-plus years, it is really more of a buying opportunity than anything. I don't want to say it's a bottom, but it is certainly starting to feel like a bottom. For the 401(k) investor, this is a good time to rebalance and stick with it.
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The 3 Most Powerful Old People in America
Continue reading… 3 CommentsMany people retire to a hammock in their backyard, bingo night, or the golf course. But some elder statesmen, business leaders, and cultural icons are achieving new heights in philanthropy, business, and law well into their ninth decade.
Slate recently ranked the 80 most powerful Americans over age 80. Here are a few of the highlights.
1. John Paul Stevens, 88, an associate Supreme Court justice who wrote the most cited opinion in American law: Chevron v. Natural Resources Defense Council
2. Kirk Kerkorian, 91, president and CEO of the investment company Tracinda Corp. and majority owner of the MGM Mirage in Las Vegas
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Geraldo Rivera, 65, Has No Plans to Retire
Continue reading… 15 CommentsAt age 65, Geraldo Rivera doesn't consider himself close to retirement. "With a 3-year-old, and five kids total, I'm not going to quit," he told the Birmingham (Ala.) News. "I've got two years left on this contract, and I'm thinking I'll work maybe three years after that. Seventy would be a good age."
Rivera, currently in Texas tracking Hurricane Ike, hosts Geraldo at Large on Fox News. He also produced and hosted The Geraldo Rivera Show for 11 years. Prominent stories he has covered include the aftermath of Hurricane Katrina, the Iraqi elections from Baghdad, the O. J. Simpson civil trial, an exclusive interview with Michael Jackson the evening before his trial on child molestations charges, and an investigation into Elvis Presley's death for the news show 20/20.
The world traveler and veteran foreign correspondent says, "I've got my weekend show, and I've got my regular Friday slot on O'Reilly, and if anything big comes up like Gustav, I'll go cover it. I've been to Iraq nine times already." Rivera has also reported breaking news from Afghanistan, Pakistan, Chile, Guatemala, the Philippines, Nicaragua, Lebanon, Croatia, Bosnia, Kosovo, and Colombia. But he wouldn't mind slowing down a bit to spend more time with his children. "I have a 3-year-old, so to the extent I can, I also like to be close to home," Rivera says.
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Seniors Losing Sleep Over Financial Worries
Continue reading… 2 CommentsNagging doubts about personal finances keep many seniors awake at night. A recent survey found that 53 percent of adults age 60 and older say current economic conditions are worse than any they have ever experienced before.
"While there have been serious economic downturns in the past, it is clear that this group of people over 60 feel particularly vulnerable during this time of their lives," says Sandra Timmermann, director of the MetLife Mature Market Institute.
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Politely Calling John McCain Old
Continue reading… 10 CommentsAs you may have heard, if elected, John McCain will be the oldest U.S. president in history. Geriatric jokes about the 72-year-old candidate are an easy choice for the late-night talk show hosts.
Senator McCain is well past many American aging milestones: Social Security eligibility (62), the age at which most people retire in the United States (63), qualifying for Medicare (65), and the age at which delaying claiming Social Security no longer produces higher payouts (70). Although not a baby boomer, he may share the work ethic of boomers who plan to work as long as possible because they like their job or desire to serve the community, but perhaps not the mentality of those who keep working because they need the money and have no other choice.
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Lance Armstrong Comes out of Retirement
Continue reading… 0 CommentsThe rumors were true. Lance Armstrong is coming out of retirement.
"I am happy to announce that after talking with my children, my family, and my closest friends, I have decided to return to professional cycling in order to raise awareness of the global cancer burden," Armstrong said. "This year alone, nearly 8 million people will die of cancer worldwide. Millions more will suffer in isolation, victims not only of the disease but of social stigma. After the passage of Proposition 15 in Texas, a $3 billion investment in the fight against cancer which is helping to make this disease part of the national dialogue in America, it's now time to address cancer on a global level."
You can watch the announcement in his own words here or read this Vanity Fair article about his return.
