USA Today, February 2nd, 2010
Hi, Gladys, I'm 73 years young and I need
to make money to supplement my Social Security. I would like to try
selling the fire extinguishers that you talked about in your book. I
think I can sell them at flea markets and maybe even set up a table at
conferences at my local convention center. I need you to supply the
name and address of the manufacturer so that I can buy them wholesale.
— Don
Yes, my teenage entrepreneurial life started out
selling all sorts of different things including fire extinguishers.
That was more than 40 years ago. I don't remember the company name or
where they were located. What I do know is that there are more
opportunities today for earning money than were available 40 years ago.
More and more seniors are entering the small
business world in order to supplement their income. And for that the
world is, or should be grateful. In the past our seniors took all of
their valuable knowledge, wisdom and know-how into retirement with
them. The economic situation of today has allowed the knowledge and
wisdom gained by those of us over 50 to remain active and lets us share
our know-how with the younger generation.
I regularly encounter folks who have taken the
knowledge they've acquired and put it to economic use. Let me share a
some of their stories with you. Hopefully you will be inspired and get
an idea or two for yourself.
I walk daily in a park near my home. On those
walks I often run into a couple, both in their mid-70s. When the cost
of living exceeded their fixed income they decided that the best answer
was to start a business. Both loved animals. They had three dogs as
pets and knew plenty about their care requirements. With that in mind
they started a "doggie daycare service." Dog lovers brought their pets
to them for care during the day instead of leaving the dogs locked up
in the house while they went to work. Their service also extends to
vacationing families that don't want to place their beloved animals in
a kennel. The couple walks the park every day with about 10 dogs on
leashes. According to them, they realize a substantial income as a
result of their service.
Read more of this article.Working in Retirement: Many companies are specifically looking to hire retirees. Let NewRetirement.com help you find these companies and other opportunities should you wish to continue working.
US News & World Report, February 2nd, 2010
President Obama’s budget for fiscal year 2011 includes many proposals aimed to help workers prepare for retirement. Here’s a look at the retirement projects the White House is asking Congress to fund.
Automatic IRAs.
Companies that don’t offer a retirement plan may soon be required to
enroll their employees in an IRA account. Under Obama’s current
proposal, 3 percent of employee pay would be direct-deposited into a
Roth IRA, the default savings vehicle. Workers may opt out, chose a traditional IRA,
or elect to save a different amount. Small firms with 10 or fewer
employees or companies that have been in business less than two years
would be exempt from participation.
Employers could claim a temporary tax credit upon automatically
signing their workers up for the IRA for $25 per enrolled employee up
to $250 for two years. Another tax credit would be available to small
businesses that begin their own retirement plan equal to 50 percent of
the start-up expenses for establishing or administering a new
retirement plan up to $1,000 per year for three years, an increase from
the $500 businesses are eligible for under current law. The proposal
would become effective in 2012.
A government 401(k) match. The Obama administration is proposing expanding the Saver’s Credit in 2011 to provide a 50 percent match on the first $500 of retirement savings
for individuals who earn less than $32,500 annually. Couples who take
home less than $65,000 could receive a match on their first $1,000 of
savings and the match would be gradually phased out for couples with
income between $65,000 and $85,000. The maximum credit would be $250
for a single filer and $500 for a married couple and be fully
refundable.
Read more of this article.Professional
Financial Advisers: Find out how these proposals will affect your retirement planning by contacting a professional financial adviser, or researching individual programs on NewRetirement.com
The Oklahoman, February 3rd, 2010
DEAR BRUCE: A few months ago I purchased a car for $28,000. Now I'm
regretting my decision. I was so excited about this shiny car that I
jumped into a deal that I just can't afford. I have been to several
dealers hoping to trade the car in on something used knowing that I
would have negative equity. Every dealer told me that it couldn't be
done, that I am "upside-down." I'm not sure what that means. How do I
sell this car and get out from under?
DEAR R.T.: Unhappily, there is very little that I know of that you can
do. When you drive a new car off the dealer's lot, it depreciates
dramatically. The problem is that if you put little or no money down,
then you are immediately "upside-down." You didn't mention it in your
letter, but I'm assuming that you financed the car for four, five or
even six years, which further exacerbates your situation. You are just
going to have to swallow hard and maybe pick up a part-time job to make
the car payments.
DEAR BRUCE: I want to throw in my two cents about viaticals. I
know you have addressed them before in your column and you are on
point. Viaticals and life settlements are not an investment for the
faint of heart. Just like the insurance business, its success depends
very heavily on the law of large numbers. We are an institutionally
funded purchaser of life settlements and own hundreds of millions of
dollars of these policies. I just don't want to see any small investors
hurt in this marketplace. -- Reader, via e-mail
DEAR READER: Thank you very much. Everything you say is true.
Investing in viaticals is one that has to be looked at very carefully.
Professionals like yourself know this, and, oftentimes, the amateur
investor is misled to their sorrow.
Read more of this article.
Life Settlement Programs: Investigate whether a Life Settlement is the right decision for you by researching on NewRetirement.com
The Seattle Times, February 4th, 2010
Washington State Long-Term Care Ombudsman Louise Ryan, an
advocate for the elderly and others in long-term-care facilities,
answered questions Wednesday online about caring for those in adult
family homes and other settings. Her office:
800-562-6028
Q: What are warning signs family should be on the lookout for when visiting family/parents in these homes?
A: Listen to what your family member is telling you
about the home. Even if they have dementia, they still might be able to
report on certain circumstances accurately. Observe their behavior/body
language around the staff. Are there smiles and respectful
communication? Do staffers know your loved one's needs and preferences?
I also think it's fair to ask your family member if you can observe
their skin, depending of course on the relationship that you have with
your family member. Also, know that not all bruises are a sign of
abuse. If you see bruises, ask your family member what happened and ask
the provider.
Warning signs of abuse/neglect/bad care can include such things as
repeated falls, unexplained weight loss, sudden changes in behavior
such as withdrawal or agitation, not toileting or grooming. Again those
are indicators. As a family member, do not hesitate to ask questions.
And if you are not satisfied with the answers, seek out help from an
ombudsman, send a complaint to DSHS, and consult with your loved one's
physician.
Q: The food at my mother's nursing home is
awful. She doesn't eat most of it and is losing weight. How do I get
them to serve more palatable meals?
A: This sounds like a project for a resident or
family council. If your mother is able to attend a resident council
meeting, have her put it on the agenda to discuss. Be specific about
the food problems — too much starch, not enough fresh fruits, and so
on. Make specific suggestions to the dietary staff and administrator.
Ombudsmen are experts at resolving food complaints: Resident Councils
of Washington: www.residentcouncil.org, and Family Councils: www.nccnhr.org
Q: Other than lower cost to the public, why
would the state put people in family-like homes instead of institutions
such as nursing homes?
A: Our state has a genuine interest in honoring
consumer choice of where a person receives services — in his own home
(and with a choice of home-care provider) or at a facility (and that
includes what type of facility). The challenge our state faces and what
was so well described in "Seniors for Sale" is that promoting choice
can become paramount to other practical matters. We want choice and we
also want quality care, services and support. Although our state faces
a huge budget crisis, this is not the time to reduce community-based
services.
Read more of this article.
Dallas Morning News, February 4th, 2010
My wife and
I are retired, in our 70s and live comfortably on Social Security,
dividends and some CD interest. We have recently received an offer
through AARP to invest in a fixed immediate annuity with a cash refund
feature that guarantees you will never be paid back less than you paid
in. In other words, if a spouse dies, the surviving spouse would be
paid the difference.
The offer indicates that a $100,000
annuity for a 76-year-old would pay $687 a month for life. That would
be $8,244 a year, or an annual return before taxes of more than 8
percent. We don't understand how the annuity can pay such a high
interest rate when our CDs are paying less than 1 percent a year. Can
you clarify this for us?
A.R., Dallas
Part of
what you are receiving is your original investment, not interest. The
actual investment return that you receive, if any, will depend on how
long you live. The longer you live, the better the chance that you'll
get "your money's worth" from the contract. Remember, you're buying a
life annuity. That's a contract with an insurance company that will
provide you with a fixed monthly payment for your lifetime. These
contracts have many variations:
• A fixed monthly payment for your life only.
• A fixed monthly payment for your life or at least 5, 10, 15 or 20 years.
• A fixed monthly payment for your life with an installment refund that
guarantees that you, or a beneficiary, will receive at least an amount
equal to the original investment paid out in monthly payments.
The
offer you got in the mail, $687 a month for life with installment
refund, is less than the amount offered on a similar contract on the
Web site www.immediate annuities.com. There, the installment refund
annuity payment is $757 a month, or 10.2 percent more. So the offer
isn't "too good to be true." It's somewhat below typical offers.
Read more of this article.Annuity
Advice for Retirement: Learn more about the ins and outs of annuities by browsing our information resources at NewRetirement.com
Business Week, February 4th, 2010
Workers approaching retirement are often told by experts that they will
need only about 80% of their income after they stop working to maintain
the same lifestyle.
After all, expenses fall when retirees don't need to dry-clean their
work wardrobe and commute every day. And they have more time to shop
for deals and handle house and yard work themselves. Presumably, the
children are out of the nest or have their own financial flight plan.
The problem is that many retirees soon discover the 80% rule of
thumb doesn't work. "I'm finding that to be unrealistic with today's
retirees," says James R. Miller, president of Woodward Financial
Advisors in Chapel Hill, N.C. "It is more like 100%."
Expenses associated with work might fall, but early retirees face
temptations everywhere, whether in the form of travel, golf, club
memberships, or more socializing.
A regular paycheck—and the obligation to save much of it each
month—often constrains budgets. By contrast, the newly retired can dip
into a nest egg for the first time, and "for some, it's akin to winning
the lottery," says Ken Eaton, a principal at financial planning firm
Stepp & Rothwell in Overland Park, Kan. Without the "artificial
boundary" of a paycheck, "they can easily spend a lot more than their
portfolio can sustain," he says.
Bloomberg BusinessWeek received tips from more than two dozen financial advisers on how to spend less in retirement.
Read more of this article.About
Reverse Mortgages: Learn all about reverse mortgages at
NewRetirement.com
Professional
Financial Advisors: Find out what a financial advisor can do for
you at NewRetirement.com.
The New York Times, February 4th, 2010
During my training, I took care of a man in his 50s with a devastating
surgical complication: His abdominal incision had split open a week
after an emergency operation. Even after we had taken him back to the
operating room, sewn the deepest layer of his abdominal wall closed and
treated the infection that had caused his wound to fall apart in the
first place, he still had a three-inch long crevice along the middle of
his belly. Until the edges contracted and the gaping expanse filled in
on its own, he and his wife would have to pack damp gauze into the
wound every day to keep it clean and help it heal.
But on a visit a few weeks after his discharge from the hospital, I
noticed that the gauze had been packed more loosely and changed less
frequently than we had instructed. What should have been white and
fluffy looked dried and yellowed, and his wound was no longer clean and
healthy but covered with crusty patches.
When I started to
lecture him on the importance of dressing changes, he leaned over to
interrupt. “Hey, Doc,” he said, pointing to the pile of unopened gauze
I had brought into the room to re-dress his wound. “Do you think I
could have the extra? This stuff isn’t cheap.”
My patient had
been cutting back on the gauze and changing the dressing less often
because he couldn’t afford the supplies. And while I had been careful
to recite the science behind the treatments, I had no idea how much he
had to pay or if he could afford the expense.
As I stuffed a
few packages into my patient’s pocket, I realized that in the busy
day-to-day pursuit of becoming a good doctor, I had telescoped in on
the clinical details, neglecting my once-cherished ideal to embrace the
social and economic aspects of health care. By the time I was in
residency, as was so apparent that afternoon, I had completely lost
touch with my patient’s economic reality.
I believed that being
a good doctor meant knowing the clinical facts down cold. And I somehow
had led myself to believe that it would’ve taken much more time and
effort to pay closer attention to those other details.
It was as if there had to be some kind of trade-off.
But
I was wrong, on two counts. It was possible to learn about the economic
and social aspects of health care while immersed in the details of
biology, physiology and pharmacology. And it was impossible to become a
good clinician without doing so.
Read more of this article.
Supplemental Medicare Insurance: Consider purchasing additional medical coverage to ensure that you can afford the costs of health care.
San Francisco Chronicle, February 6th, 2010
A 25-year-old former customer service representative with a San
Francisco branch of Bank of America has been charged with swindling
$61,000 from a 96-year-old woman who entrusted him with her finances.
Saul Cornejo of Daly City was being held on $50,000 bail after
pleading not guilty Thursday to charges of felony elder abuse and grand
theft. His attorney, Carmen Aguirre, declined to comment.
Police said the victim, Eunice Mongan of Daly City, was a customer
at the BofA branch at 5150 Mission St. and made weekly visits to
transfer money to pay her bills.
Cornejo persuaded her to open an account and allow him access to it as her "personal banker," San Francisco prosecutors said.
They say that from July 2008 through August 2009, Cornejo opened new accounts in Mongan's name and withdrew money from them.
The alleged crimes came to light in August after Mongan's niece
accompanied her to the bank and thought Cornejo was acting
suspiciously.
The niece did some checking and discovered that her name had been
removed from some of the accounts and that statements had stopped
coming to her aunt, prosecutors said.
She then went to Bank of America officials and San Francisco
police, who found a total of $61,000 missing from her aunt's accounts
and from the proceeds of a reverse mortgage.
Read more of this article.About
Reverse Mortgages: Know the possible risks and benefits of a reverse mortgage by researching the program on NewRetirement.com
Deseret News, February 5th, 2009
When given the opportunity, criminals will target whom they perceive
as the weakest among us. And that notion could become even more
apparent as Utah and the nation cope with the bursting of the real
estate and economic bubbles.
The
Salt Lake office of the Federal Bureau of Investigation and the Utah
Division of Real Estate have compiled a list of the potential top five
mortgage related rip-offs in 2010. Chief among them: a reverse mortgage
scam targeting the elderly.
"Scam
artists are always looking for new ways to reinvent the same crime,"
said Michelle Pickens, special agent and mortgage fraud coordinator
with the FBI. "The reverse mortgage scam is based off the 'straw buyer'
model where they use senior citizens … against their own mortgages."
Reverse
mortgages can be a legitimate way for homeowners to take equity from
their homes without a monthly payment, which can be especially useful
to seniors who need supplemental income during retirement, she said.
Unfortunately,
con artists sometimes convince seniors they can live in a home for
free, obtain a home loan under the occupant's name and disappear with
the equity, while leaving the victim to repay the mortgage.
Read more of this article.
About
Reverse Mortgages: NewRetirement pre-screens reverse mortgage lenders to work with, and provides as much information as we can about the pitfalls and considerations that seniors should know about when dealing with reverse mortgages. Learn more at NewRetirement.com.
Mortgage Refinancing: Learn what you should and shouldn't do when considering refinancing your home at NewRetirement.com.
The Kingston Whig-Standard, February 5th, 2009
A formalized savings plan is one of the soundest
ways to turn your retirement dream into a reality. Taking advantage of
the tax benefits of an RRSP, TFSA and RRIF are strategies that I have
always recommended. Here are some strategies that you can use to
maximize the benefits of your Self-Directed RRSP, TFSA or RRIF.
GROW YOUR SAVINGS
* TFSA is a new general-purpose tax-efficient vehicle for
Canadians that complements existing registered savings plans for
retirement and education. TFSA will allow Canadians to set money aside
in eligible investment vehicles and watch those savings grow tax-free
throughout their lifetimes. TFSA savings can be used to purchase a new
car, renovate a house, start a small business or take a family
vacation. It's the single most important personal savings vehicle since
the introduction of the RRSP.
* Make an "In-Kind" contribution -With a self-directed RRSP,
you can contribute qualified securities you already own rather than
selling the securities and contributing cash. You'll still have to pay
the tax on any accrued gains at the time of the transfer but don't
transfer securities that have declined in value, as the loss will be
denied.
* Consider an RRSP loan -If you do not have enough money to
make a full RRSP contribution this year or you want to take ad-v a nt a
g e of your unused RSP room, consider an RRSP loan. By applying the tax
refund generated by your RRSP contribution to the balance of the loan,
you should be able to pay off the entire loan within the year. Interest
on these loans is not tax-deductible so paying off the loan as quickly
as possible is a must.
* Get out of that RRIF -A RRIF requires you to take a minimum
amount from the plan each year. If you don't need the income and are
under age 71, roll your RRIF back into an RRSP. Although this can be
done on a tax-deferred basis, you will be required to make the annual
minimum withdrawal from the RRIF before the plan is closed.
Read more of this article.Professional
Financial Advisors: Many of the above plans are highly technical, and can require expert advise to properly employ and integrate with your portfolio. Consider looking into a professional financial adviser to assist you in navigating your financial plans.
Montana Billings-Gazette, February 4th, 2009
A disproportionate number of Montana nursing homes rated below
average by the government are operated by for-profit corporations,
an analysis shows.
Almost 60 percent of the state’s skilled-nursing facilities awarded
one or two stars by Medicare are for-profit entities, according to
information available on the government’s Nursing Home Compare Web
site.
But only about 40 percent of all Montana nursing homes are run by
for-profit companies.
“I don’t know whether they’re trying to cut corners,” said Kathy
Chaffee, regional ombudsman for the Area II Agency on Aging in
Billings. “What I would like to see are their survey results. What
are they not doing?”
Medicare rates nursing homes on a five-star scale using data
collected during annual inspections. Facilities are also scored on
their staffing levels and how they perform on certain quality
measures.
Some 26 of Montana’s 90 nursing homes earned one or two stars in
the most recent analysis. One star is “much below average” and two
stars is “below average,” according to Medicare.
Read more of this article.Long Term Care Insurance: Consider mitigating the enormous financial burden of Long Term Care by researching your options at NewRetirement.com.
AP Newswire, February 4th, 2009
The financial strain of caring for older relatives can be
devastating without proper planning. Here are some online resources for
those who want to put the proper safeguards in place and for caregivers
who may be looking for assistance:
www.medicare.gov -- Find out what Medicare
does and doesn't cover, compare home health agencies and nursing homes
in your area, plan for your long-term care needs and other information.
www.homeinstead.com -- Home Instead Senior Care site has resources for finding home care, becoming a caregiver and other elder care resources.
www.state.gov/m/dghr/flo/c23141.htm -- A U.S. State Department
site on caring for elderly parents that is aimed at families posted
abroad but gives very valuable general information and links.
www.caregiving.org -- National Alliance for Caregiving, a nonprofit organization focusing on issues of family caregiving.
www.caps4caregivers.org
-- Children of Aging Parents, a nonprofit assisting caregivers of the
elderly or chronically ill with information, referrals and support.
www.thefamilycaregiver.org
-- National Family Caregivers Association, another group that educates
and supports those who care for loved ones with a chronic illness or
disability.
Read more of this article.Long Term Care Insurance: Consider mitigating the enormous financial burden of Long Term Care Insurance by researching your options at NewRetirement.com
The New York Times, February 4th, 2009
Re “Annuities Get Obama Fist Bump” (Your Money column, Jan. 30):
The Obama administration is rightly promoting annuities as part of its
strategy to give Americans a better shot at a more secure retirement.
But retirees need not sacrifice complete control of their retirement
savings to enjoy a guaranteed income for life.
Many companies
have begun offering their employees “guaranteed minimum withdrawal
benefit” options for their 401(k)s. These hybrid provisions grant
workers many of the benefits of traditional annuities, including a
level of guaranteed income and income protection from volatility in the
financial markets. These flexible lifetime income guarantees do not
typically lock retirees into defined payout schedules.
They can
also allow retirees to pass assets along to their heirs. Americans
nearing retirement are understandably nervous about their financial
security. Annuities and guaranteed lifetime withdrawal benefits both
have an important role to play in mitigating that uncertainty and
helping Americans preserve the value of their retirement savings.
Christine C. Marcks
President, Prudential Retirement
Hartford, Feb.
3, 2010
Annuity
Advice for Retirement: Evaluate and compare annuities at
NewRetirement.com
The New York Times, January 27th, 2009
Annuities are a basic staple of modern portfolios, the financial equivalent of a backstop to guarantee a minimum of income in
retirement.
They work like an old-time corporate pension plan, paying out a regular
amount of money over the course of retirement. The big difference is
that amount you receive is wholly dependent on how much you put into
the annuity.
Here are the basics of annuities.
TYPES In its most basic form, an annuity is a contract with an insurance
company that makes payments at regular intervals for a set period of
time. The classic fixed-annuity provided people a set payment for
however long they lived — from a few months to decades. An insurance
company’s actuaries took their best guess on your life expectancy while
you hoped to outwit them and collect a check into your 90s.
Few
annuities are structured this way anymore. One reason is people have
realized that a static payout is not great. For one thing, it does not
account for inflation: $1,000 a month today will probably not buy as
much in 10 or 20 years.
To make annuities more appealing — and to
bring in more money — insurance companies created more sophisticated
types of variable annuities.
Many of these annuities offer the
option of a higher payment if the value of the underlying securities
rises yet lock in a minimum payment if they fall.
Read more of this article.
About
Reverse Mortgages: Learn all about reverse mortgages at
NewRetirement.com
Professional
Financial Advisors: Find out what a financial advisor can do for
you at NewRetirement.com.
The New York Times, January 29th, 2009
Annuities: The official
retirement vehicle of the Obama administration.
As slogans go, it’s hardly “Keep Hope Alive,” or even “Change We Can Believe In.”
But there were annuities, in a report
from the administration’s Middle Class Task Force that came out this
week. They are among the tools the administration is promoting as it
tries to give Americans a better shot at a more secure retirement.
At
its simplest, which is how the White House seems to want to keep it, an
annuity is something you buy with a large pile of cash in exchange for
a monthly check for the rest of your life.
If the biggest risk
in retirement is running out of money, an annuity can help guarantee
that you won’t. In effect, it allows you to buy the pension that your
employer has probably stopped offering, and it can help pick up where Social Security leaves off.
President Obama did not discuss annuities in his State of the Union address
on Wednesday night, probably figuring that viewers had enough problems
staying awake. But the mere mention of them by the task force was
enough to send executives at the insurance companies that sell the products into paroxysms of glee.
“I
never thought I’d have the president as a wholesaler for us,” said
Christopher O. Blunt, executive vice president of retirement income
security at the New York Life Insurance Company. “This is awesome. I’m
trying to see if I can get him to do a big broker meeting for us.”
Read more of this article.About
Reverse Mortgages: Learn all about reverse mortgages at
NewRetirement.com
Professional
Financial Advisors: Find out what a financial advisor can do for
you at NewRetirement.com.