By Beth Franklin, Investment News – Aug 7, 2014
I received an interesting question from an individual investor during one of my recent Social Security presentations.
The woman, a client who attended a financial planning firm’s retirement symposium where I was speaking in McLean, Va., wanted to know why her Social Security benefit had declined this year.
Was she younger than her full retirement age and still working? I asked.
No, she replied.
By Richard Eisenberg, Forbes – Aug 7, 2014
If you’ll be applying for benefits anytime soon, you’ll likely encounter this problem first-hand should you want to go to a Social Security office or call the agency’s 800-number with a question.
And you may have noticed that, in 2011, Social Security stopped mailing statements telling you how much you could expect to receive in benefits. Instead, you were told to go to the Social Security Administration’s website and sign up for something called my Social Security. The agency’s rationale: a $30 million savings that year and $70 million a year thereafter. (It resumed the mailings for people 60 and older in February 2012.)
MarketWatch – Aug 7 2014
Many U.S. households are not prepared or even planning for retirement, according to a new survey released by the Federal Reserve Thursday.
“When it comes to planning and saving for retirement, the survey results tell a somewhat cautionary tale,” the survey concluded.
Despite the shift from pension plans to 401k plans, which has placed responsibility on the individual to plan for his or her their retirement, only about a quarter of those surveyed appear to be actively doing so.
Here are some stark facts:
Even the concept of retirement seems to be losing its luster. Among those ages 55 to 64 who had not yet retired, more respondents said they expect to keep working “as long as possible” than households who said they plan to follow the traditional retirement model of working full time until a set date and then stopping working altogether.
By Harry Brill, BeyondChron – Aug 6, 2014
Despite running a surplus of $2.8 trillion, the Social Security Administration (SSA) has closed 80 offices, eliminated over 500 temporary mobile offices, and reduced its workforce since 2010 by 11,000. Moreover, it is planning on closing in the near future hundreds of more offices, and eventually, shutting down as many of the 1,245 field offices that it can get away with. Many additional thousands of useful jobs will be discarded. Seniors will be compelled to cope with their questions and concerns via the computer. If things go as planned, SSA’s functions will be outsourced to private contractors.
By Emily Brandon, U.S. News & World Report Aug 5, 2014
Here are the taxes to consider as you select a place to retire.
By Jeff Brown, TheStreet – Aug 5, 2014
NEW YORK (TheStreet) — What will it take for a satisfying retirement?
Not as much as you think, perhaps.
Financial experts have kicked this question around for decades. The oft-quoted rule of thumb says the average retiree needs 70% of pre-retirement income to maintain the same standard of living after quitting work. That assumes there will be no further need to save and that the mortgage is paid off and expenses such as commuting are a thing of the past.
By Anne Tergesen, MarketWatch – Aug 5, 2014
A new report from the U.S. Government Accountability Office concludes that while these accounts can deliver higher returns and lower risk to 401(k) participants, they also charge higher fees that can offset some or all of their advantages.
In the wake of a set of 2007 regulatory changes that give employers a green light to automatically enroll 401(k) participants into managed accounts, these investment vehicles have become increasingly popular. About 36% of 401(k) plan sponsors offered managed accounts in 2012, up from 25% in 2005, according to the Plan Sponsor Council of America. Cerulli Associates, a research firm that specializes in the asset management industry, recently reported that there were $108 billion in assets in 401(k) managed accounts. Many industry watchers expect demand to grow as the baby boomers get closer to retirement – frequently a time when employees seek out the more customized advice available through a managed account.
Here’s a little something to lure them out of their mental bunkers: From wages and debt levels to health-care costs, some of the scariest financial trends are reversing. That doesn’t mean Americans can stop saving. But they may want to take a break from all the worry and self-flagellation to enjoy some actual good news on the retirement front.
By Philip Moeller, Time – Aug 5. 2014
Lately, though, the situation has quietly been improving — as the most recent government data released last week again confirmed. The trustees of Social Security and Medicare reported that the latter program should have enough money in its hospital insurance trust fund to last through 2030 — four years longer than they projected last year and 13 years longer than projected in 2009. The Congressional Budget Office’s updated estimate of long-term federal spending on major health programs (Medicare, Medicaid, the Children’s Health Insurance Program and Obamcare health-care exchange subsidies) would equal 8 percent of GDP in 2039 — 1.6 percentage points, or about 15 percent, less than the 9.6 percent the agency projected in 2010. It’s now 4.8 percent of GDP.