Your Retirement | WYPR

Your Retirement

Every once in a while, an organization will publish their rankings of the best and worst states or cities for retirement.  Bankrate recently did just that, ranking the nation’s fifty largest metropolitan areas.  Bankrate considered a host of factors, including cost of living, taxes, crime healthcare, public transit, weather, things to do, and the percent of population 65 or older. Get the results in this episode.

A report from the National Institute on Retirement Security entitled 'Millennials and Retirement:  Already Falling Short,' further contributes to our collective understand of how vast the nation’s retirement crisis has become. The analysis finds that 66 percent of working Millennials have nothing saved for retirement, and the situation is far worse for Millennial Latinos. Among Latinos, about 5 in 6 Millennials who are working have nothing saved for retirement. The report further indicates that a bit more than a third of Millennials actually participates in employer-sponsored retirement plans despite the fact that two-thirds of Millennials work for employers offering such plans.

Unretirement

Apr 20, 2018

Many of us plan retirement for years.  We contribute to our 401ks.  We pick out a place in Florida.  We tell our kids and grandkids that it’s going to be OK, but that they’re going to have to take care of themselves from now on.  And then the day comes – we retire – and then, sometimes, we decide, that retirement is just not for us.  Economists refer to this lifestyle U-turn as unretirement.

Downward Mobility

Apr 12, 2018

A recent Forbes article concludes that there are 8.5 million older workers and their spouses who will experience downward mobility in retirement absent some deviation from current trend. Who are these endangered 8.5 million?

There continues to be much discussion regarding America’s retirement crisis. Far too many people lack adequate retirement savings, and face diminished living standards once they stop working. In response, there has been a move toward automatic enrollment in employer-sponsored retirement plans.

Earlier this year, it appeared that something quite rare was about to occur.  One of the fifty U.S. states, Washington State, was striving to pass a bill that would have instituted a new payroll tax to help cover the cost of long term care, whether in a nursing home, a residence, or elsewhere in a community.

Efforts to keep older Americans in the workforce longer could help combat America’s high rates of old age poverty and also reducing inequality—this according to a new report from the Organization for Economic Cooperation and Development or OECD. The Paris-based think tank provides advice on the best policies to follow to its 35 member governments. The report calls upon America to support longer careers for all socioeconomic groups as a way to diminish old-age poverty without placing additional strain on pension systems. More than 20 percent of Americans over the age of 65 have an income that classifies them below the poverty line. For purposes of the OECD study, poverty was defined as half of median disposable household income.  Future retirees face even higher risks of poverty as inequality advances. As indicated in The Wall Street Journal, while America has a higher share of older people in the workforce compared to most major economies, how people fare in their later years depends critically on educational attainment.  The gap between workers with different skillsets is enormous and poised to widen as digital transition progresses according to OECD analysts. One way to support longer careers is by offering flexible or phased retirement. Under such a system, older workers receive a full or partial pension benefit while continuing in paid work, often with reduced hours. Far fewer Americans work part-time in retirement relative to populations in Germany and the United Kingdom. 

You are probably not looking for a reason to retire early.  The reason is fairly obvious.  Early retirement may be much more pleasant that working well into one’s 60s or 70s or beyond.  But here’s another reason that renders early retirement more appealing – it could lengthen your life.  That’s the conclusion of research made available over the years as well as from a 2017 study published in the journal Health Economics.  As indicated by The New York Times, in that study, three economists from the Netherlands analyzed what transpired when some Dutch civil servants could temporarily quality for early retirement in 2005. Men responding to the early retirement offer were nearly three percentage points less likely to die over the next five years than those who did not retire early. Parenthetically, too few women met the early retirement eligibility criteria to be included in the study. In any case, these findings echo those of other studies. For instance, an analysis in the U.S. found that seven years of retirement can be as good for one’s health as reducing by 20 percent the chance of acquiring a serious disease like diabetes or heart conditions. The salubrious effects of retirement have also been discerned in studies using data from England, Germany, and Israel. This likely reflects the fact that for many people, work can be stressful and can leave little time for exercise.  

To stretch out one’s retirement savings, one may have to eventually move to a lower cost city. Many people from the northeast United States end up moving to the American South, with one of the major factors being warmer weather. But that’s hardly the only factor. States like North and South Carolina tend to have costs of living far beneath what one contends with in Connecticut, New York, New Jersey or Maryland.  One of the difficulties in understanding differential costs of living in various areas is a dearth of comparable data.

Stock Ownership

Mar 1, 2018

There has been a lot of discussion in recent years regarding America’s retirement savings crisis.  One might think that a significant fraction of this crisis has been resolved by a booming stock market, with the logic being that 401Ks and 403Bs have been sufficiently stimulated to better position Americans for their golden years.  But data indicate that rising or falling stock prices have little impact on the income of wealth of most families. The reason?  They own little or no stock.  As indicated by writer Patricia Cohen, an astonishing 84 percent of all stocks owned by Americans belong to the wealthiest 10 percent of households... 

Start Saving Young

Feb 22, 2018

Let’s say that you are thirty years old. If you are, I am already not that fond of you, but let’s set that aside.  You may be wondering as a young person with much to look forward to how you should be preparing for the balance of your financial life, including retirement. The first piece of advice would be to avoid mimicking the behavior of the majority... 

Anirban gives an overview of a survey of Millenials' ideas around retirement savings. 

All of us have grown up understanding the concept of retirement. The notion is very simple – we work, we save, and then we stop working and enjoy a whole lot of free time during which we take care of grandchildren, golf, knit, travel, or all of the above. But as indicated by Kiplinger, hundreds of years ago, most people didn’t grow old so there was no need to retire.  People often worked to survive until they were simply unable to work any longer...

We’ve spoken repeatedly about the notion that you would likely be better off financially in retirement if you worked for more years and waited to begin claiming Social Security.  Not only does working longer allow one to save more money for retirement, but delaying the receipt of Social Security benefits increases the value of monthly benefits.  Here’s another reason to hold off collecting those Social Security checks – if you retire early, you are more likely to die earlier as well...

So now we are into 2018, which means that we are in the midst of another year during which people will be both fretting about and preparing for retirement.  As indicated by U.S. News, there are some reasons to believe that your retirement will be meaningfully better than the one your grandparents lived. At the heart of this optimism are technological advances...

Let’s say that you work for a company offering automatic enrollment in their retirement plan. That’s a good thing. In such instances, the employer will typically enroll an employee in the plan once he or she meets eligibility requirements. At that point, a certain percentage of the paycheck, known as the contribution rate, will be directed into the investment fund the company has selected...

Economic Insecurity

Jan 11, 2018

Inequality and economic insecurity have been on the rise among American workers for years. A new report from the Organization for Economic Cooperation and Development finds that the situation deteriorates further as Americans age into retirement...

Fragile finances

Jan 4, 2018

Record number of Americans older than 65  are working – now nearly one in five as indicated by the Washington Post. That proportion has risen steadily over the past decade and at a rate far in excess of any other age group...

Where to Retire

Dec 28, 2017

We often pontificate about how to save for retirement, how much to save, how long to work, and how to budget. But perhaps the solution to retirement lies largely in deciding where one should live.

A 2016 Fidelity study estimates that a typical retired couple will have $260,000 in out-of-pocket healthcare outlays, up from an estimated $220,000 in 2014...

Delaying Retirement

Dec 15, 2017

There are a lot of people in a lot of places offering retirement advice.  Many of these advisors suggest taking full advantage of employer-sponsored savings plans, maintaining a diversified portfolio, and quickly paying off high interest debt.  All of that makes sense...

What does it mean to retire early?  Well, according to Aperion Care, which has produced an interactive map indicating the official and average retirement ages for people around the world, the typical American leaves the workforce at the age of 63...

When people need cash in a hurry, their lack of emergency savings can create financial issues far beyond that short-term cash crunch.  

Questioning Retirement

Nov 23, 2017

So you want to retire early? There's some questions you should be asking yourself. 

Inequality and economic insecurity have been on the rise among American workers for years...

Many would agree that we are in the midst of a retirement crisis, with many households effectively having saved nothing for retirement and therefore enormously dependent upon a single source of income – Social Security.  But is it possible that one day in the distant future, America will not be in the midst of a retirement crisis because household savings patterns will have changed? 

In this segment, we often discuss the lack of preparedness for retirement suffered by many Americans. But with the economy improving recently and financial markets surging, there have been some positive developments and there is evidence of growing confidence among seniors...

October is an important month for America’s retirees. That’s not simply because there will soon be children banging on doors making outrageous demands for candy and threatening diabolical acts. It’s also because October is the month when Social Security trustees typically announce the annual cost of living adjustment to monthly checks.  

Working Seniors

Oct 19, 2017

Many of us worry that we will not have the financial capacity to actually retire. We are living longer, which is a good thing, but our lives are also more expensive and many of use to not have an extensive financial safety net.  Accordingly, record number of Americans older than 65 are working – now nearly 1 in 5 as indicated by The Washington Post.  

Unpaid Eldercare

Oct 13, 2017

For a growing share of older Americans, retirement may be approaching, but so too is a new job:  unpaid care for the elderly...

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