The Best Life
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Roth IRA Conversions Worth Considering
Continue reading… 2 CommentsFidelity Investments reports that a survey of 800 customers finds very little understanding of Roth IRAs. USAA, another big financial-services firm, did a similar survey over the summer and found the same thing. Both firms say the lack of understanding could be very costly to investors next year, when special rules take effect permitting holders of regular IRAs to convert them into Roth IRAs regardless of their taxable income levels. Right now, less than 10 percent of those surveyed plan to take advantage of the 2010 conversion rule. The companies say the percentages likely would be much higher if investors better understood Roths and the possible conversion benefits.
[See A Guide to Roth IRA Conversions.] -
Three Tips to Protect Your Credit Rating
Continue reading… 1 CommentThe Boomerater™ Report, our weekly collaboration with online baby boomer resource Boomerater, this week explores how to get a free credit report and protect your credit rating from being lowered.
[See 6 Money Lessons of the Great Recession.] -
A New Role for Stocks in Retirement Funds?
Continue reading… 2 CommentsThe stock market—and retirement accounts—are slowly recovering some of the horrendous losses inflicted in 2008 and early 2009. No one knows how many years it will take before investment values claw their way back to the level of the fall of 2007. But what is clear is that stocks will lead the way up, as surely as they led the collapse. What's also clear is that many investors have been warned away from retirement funds with heavy stock weightings.
Target-date mutual funds, which are designed to produce optimal returns based on a planned retirement date, have taken a sustained drubbing from many consumer advocates who have testified on Capitol Hill and from more than a few investment experts. The funds hold a mix of stocks, bonds, and money-market instruments and automatically adjust the percentages of such holdings as investors near retirement. This is known as a "glide path." When such funds designed for people reaching retirement age in 2010 lost 25 percent of their value last year, it came as a shock—especially to those who thought funds designed for people retiring soon should have been much less heavily invested in stocks.
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Here are Memories Worth Preserving
Continue reading… 0 CommentsFor the past 12 years, Beloit College has produced an annual list of things we take for granted but which are alien to incoming college freshmen. It is an enjoyable way to feel really old. This year's list, for example, reminds us that Shrek is the only Green Giant that this year's college freshmen know, that they have never used a card catalog and that the phrase "Help, I've fallen and I can't get up" means nothing to them (and neither does Steve Urkel).
[See America Turns Inward in Tough Times.] -
Four Free Entertainment Tips for Families
Continue reading… 2 CommentsThe Boomerater™ Report, our weekly collaboration with online baby boomer resource Boomerater, this week explores totally free, fun things to do with your family. “A couple of weeks ago you had ideas for no or low cost entertainment for singles," a member asks. "I’d like to learn suggestions for free entertainment for families on a tight budget. Our family plays board games and cards and we go to area parks, but would like to try some different free activities out of the house. My daughter is 13 and my nephew is 8.” Here are some Boomerater replies:
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These Digital Doctors Thrive on House Calls
Continue reading… 4 CommentsWireless and other digital forms of virtual healthcare, if designed and used well, can save a large amount of money, create better health outcomes, and help seniors remain in their homes. The extent and timing of this trend remains unclear, but seniors and their families should expect to see various forms of remote medical care headed their way. With aging populations soaring in virtually all of the world's most affluent countries, using technology to save money and improve medical care is set to become a major global industry.
[See tips on Making a Housing Plan for Your Later Years.]
Last April, General Electric and Intel said that they would partner to develop and commercialize home healthcare technologies. Thousands of start-up companies may have promising technologies and share similar dreams. But perhaps none have the commercialization experience, government-relations savvy, and global reach of GE and Intel. Today, the companies' home healthcare offerings include GE's QuietCare product and the Intel Health Guide. GE will market the Health Guide through its sales network, and the companies say they will invest $250 million in building the partnership over the next five years. Given their size and the scale of the opportunity, that number most likely is only an opening ante in what will be a much bigger game.
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Is This High Tide for Senior Finances?
Continue reading… 0 CommentsFor people using Social Security and Medicare, today may some day be remembered fondly as the high-water mark of these benefit programs. And as the financial pressure for reduced support mounts, it would be wise to step back and see what your next five to 10 years would look like if the values of these benefits declined by five or even ten percent. The odds of such a steep decline are slight but so were the chances that housing and investment markets would take a double swan dive of historic proportions. This is the time to think about such matters, not when they're already here, staring you in the face.
[See Why Retirement Spending Is More Art Than Science.] -
Four Financial Tips for Widows
Continue reading… 1 CommentThe Boomerater™ Report, our weekly collaboration with online baby boomer resource Boomerater, this week helps widows plan for their financial future while avoiding mistakes others have made. “My dear husband recently passed away," a Boomerater member writes. "For 40 years he handled our finances and I’m lost without him. I want to make sure our savings last so that I have financial security. My husband was a wonderful handyman who could fix anything and he did most of the yard work. I am considering selling the house and moving to a retirement community. Also, I work full time, but am thinking of retiring or changing to a less demanding job. There are so many decisions to make, where do I start?” Here is what other members said:
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Why Retirement Spending Is More Art Than Science
Continue reading… 8 CommentsRetirement experts have long advocated a conservative approach to spending down retirement assets. That's to ensure people don't outlive their funds. The most common rate recommended is 4 percent a year, although 5 percent and even 6 percent are sometimes considered appropriate, depending on an individual's financial circumstances and health. In the real world, however, there are wild variations when it comes to how people spend their money.
[See 3 Ways to Get Your 401(k) Back on Track.]
Research on the spend-down patterns of retirees leaves some to be desired. Fidelity Investments says its 18 million customers spend down their assets at a rate slightly above 4 percent. But that's an aggregate average that masks wild variations in behavior. And even at Fidelity, which beats the drum of retirement planning loudly and regularly, only 20 to 25 percent of those 18 million customers have ever completed a retirement plan, let alone followed its recommendations.
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Grandparents Get a Day -- Deserve Whole Year!
Continue reading… 0 CommentsRetirement was a receding concept for many grandparents even before the recession. But now, with pocketbooks and portfolios squeezed, and with many adult children out of work and struggling economically, grandparents are expected as never before to pitch in. So, when the 30th anniversary of the nation's first Grandparents' Day rolls around on Sept. 13, take your bow. Then, get back to work!
[See America Turns Inward in Tough Times.]
