Posted on July 19, 2006 by Jason
By Rep. Buck McKeon (R-Calif.)
The Hill, July 19th, 2006
In the fall of 2004 — nearly two years ago — the
House Education and the Workforce Committee unveiled six principles to
fix our nation’s outdated pension laws.
These pillars represented the foundation for the defined-benefit
pension overhaul Congress was about to embark upon, and our committee
pledged to incorporate each principle into the final legislative
product we would send to President Bush.
Now, as the House-Senate conference readies a final blueprint, it is fitting to return to these six principles:
• Certainty. Establishing a permanent interest rate to calculate
employers’ pension liabilities more accurately so that they fund their
pension promises.
• Common sense. Enabling employers to build up a cushion in their pension plans during good economic times
• Stability. Closing funding loopholes and ensuring that employers make adequate and consistent cash payments to their plans.
Read more of this article.
Posted on July 19, 2006 by Jason
The New York Times, July 18th, 2006
The pharmaceutical industry is beginning to reap a windfall from a
surprisingly lucrative niche market: drugs for poor people.
And analysts expect the benefits to show up in many of the quarterly
financial results that drug makers will begin posting this week.
The windfall, which by some estimates could be $2 billion or more this year,
is a result of the transfer of millions of low-income people into the new
Medicare Part D drug program that went into effect in January. Under that
program, as it turns out, the prices paid by insurers, and eventually the
taxpayer, for the medications given to those transferred are likely to be higher
than what was paid under the federal-state Medicaid programs for the poor.
About 6.5 million low-income elderly people or younger disabled poor people
were automatically transferred into the Part D program for drug coverage.
Because their other health needs are still covered by Medicaid, they are called
dual eligibles.
Read more of this article. Learn more about Medicare.
Posted on July 17, 2006 by Jason
Washington Post, July 17th, 2006
If you hate making retirement
investing decisions, you might love the latest mutual fund
trend: Target-date retirement funds that require you to choose
a fund once and then forget it for decades.
These one-decision funds are a true trend. The first one
appeared in the late 1990s, and now there are more than 155 of
them, most created within the last three years, says
Morningstar.
To invest in one of these funds, you choose your expected
retirement date, and pick a fund that is aimed at that date.
So, a 25-year-old might choose a target 2050 fund, and a
60-year-old might choose a Target 2010 fund. The funds are
themselves funds of funds, premixed baskets of stock, bond and
real estate funds. As the target date of the fund approaches,
the portfolio mix gets more conservative, moving toward more
bonds and fewer stocks.
But even folks who have an aversion to investment decision
making have to go through the process at least once, to choose
the best target fund for them. And that requires a lot of
research.
Read more of this article.
Posted on July 17, 2006 by Jason
The Arizona Republic, July 17th, 2006
Worried about the rise of do-it-yourself retirement? Sit back and
relax. At least, that’s what the big financial services firms, and more
and more employers, want you to think you can do.
As 401(k)s,
employee stock-purchase plans, individual retirement accounts and other
defined-contribution programs supplant the old-fashioned company
pension, more and more of the “work” that employees must do to choose
retirement investments is being taken out of their hands.
That just might be what the doctor ordered, though, since studies show
that more workers contribute more money to their retirement when their
companies do it for them, with few people choosing not to participate.
Here are some of the 401(k) features you’re likely to see more of in the future:
• Automatic enrollment. More and more companies are choosing to automatically enroll new employees in their 401(k) plans.
Read more of this article.
Posted on July 13, 2006 by Jason
PSAs, booklet educate
seniors on preventing
telemarketing fraud
SeniorJournal.com, July 12th, 2006
The majority of fraudulent
telemarketing calls, 56 to 80 percent, are directed at senior
citizens. This problem is becoming worse as more and more Americans move
into the 65 and older age group. The National Crime Prevention Council,
in recognition of National Fraud Awareness Week, has issued a new
booklet – available online, and launched new television public service
announcements to help older Americans avoid telemarketing fraud.
Each year, nearly 25 million Americans, mostly
seniors, are victims of consumer fraud. In many cases, people have been
victimized in their own homes and even lost their life savings.
Many legitimate companies and charities solicit
consumers by phone and consider it an effective way to raise money or
increase company business. However, others are up to no good, says the
National Crime Prevention Council. Seniors can prevent telemarketing
fraud by being shrewd and savvy with telemarketers and keeping these
tips in mind:
? Offers too good to be true usually are. Ask to
receive the unbelievable deal or the amazing prize offer in writing so
you can read it carefully before making a commitment.
Read more of this article. Learn more about Retirement Pitfalls.
Posted on July 13, 2006 by Jason
Reuters, July 12th, 2006
If you hate making
retirement investing decisions, you might love the latest
mutual fund trend: Target-date retirement funds that require
you to choose a fund once and then forget it for decades.
These one-decision funds are a true trend. The first one
appeared in the late 1990s, and now there are more than 155 of
them, most created within the last three years, says
Morningstar.
To invest in one of these funds, you choose your expected
retirement date, and pick a fund that is aimed at that date.
So, a 25-year-old might choose a target 2050 fund, and a
60-year-old might choose a Target 2010 fund. The funds are
themselves funds of funds, premixed baskets of stock, bond and
real estate funds. As the target date of the fund approaches,
the portfolio mix gets more conservative, moving toward more
bonds and fewer stocks.
But even folks who have an aversion to investment decision
making have to go through the process at least once, to choose
the best target fund for them. And that requires a lot of
research.
Now, research firm Lipper has taken a stab at comparing the
funds. And while the firm did declare a “bake-off winner” it
also demonstrated that there are so many variables involved in
these funds that making one decision, once, is very tough.
Read more of this article. Learn more about Investments.
Posted on July 13, 2006 by Jason
CNN Money, July 12th, 2006
I recently saw an article about the cost of maintaining an affluent lifestyle in
retirement in different regions of the country. I can’t identify with such high
living, however. So can you tell me how much I have to save in order to have an
upper-middle-class lifestyle in retirement?
– Patrick Leonard, Olathe, Kansas
You’ve got to be careful about labels like “affluent,” “middle class” and
“upper middle class” to describe someone’s finances or lifestyle. After all, I
know people who live in homes worth close to a million bucks, own a big SUV or
two, take several vacations a year, but they’d recoil in horror if you suggested
that they were “affluent” or “rich.” They consider themselves upper-middle-class
at most.
So when you want to do some serious planning about your retirement, you’re
much better off avoiding imprecise concepts and focusing instead on some hard
numbers.
And the number you want to focus on in this case is how much annual income do
I need to live the type of life I want to lead in retirement?
Read more of this article. Learn more about Retirement Plans.
Posted on July 11, 2006 by Jason
The Seattle Times, July 10th, 2006
As I said last week, it’s easy
to age successfully when you’re healthy. Similarly, care providers have
the easiest time pleasing clients who have few needs. Where the pedal
hits the metal in all eldercare — whether it’s in home care or
residential services — is when you become frail and unable to care for
yourself. Then it’s a double-whammy: Not only are you vulnerable to
getting poor services, but you’re also less able to pick up and leave.
Which is why your first eldercare choice is often the most
important: It sets the stage for what happens next. It’s also why my
No. 1 rule in eldercare is simple: Plan for change. You’re healthy now,
but what happens when you’re not? Too many older people and their
families fail to look beyond their noses when they start down this
road. Like it or not, medical science lets us live well beyond our
wildest dreams. It’s something we can’t predict but it’s important to
add to our decision-making process: Where does this provider’s care
end, and where will we need to go next?
Like most things we buy, marketing sells the sizzle in eldercare,
and sometimes it’s better than the steak. “Lite” assistance dominates.
Effervescent ads promising adventure and fun catch your attention,
turning scowling images of aging into smiles. That’s good; negative
images of aging have dominated too long. But sometimes we forget to
think about the future when life gets more difficult.
I call it the “pretty wallpaper” effect — families often choose a
place based on what’s on the walls. I understand we like things to look
nice. But what happens when your mom falls? When she needs help at
night getting to the bathroom? When she becomes demented? When she’s
dying? The wallpaper won’t be important then. Your primary concern will
be the services in place to care for her.
Read more of this Article. Learn more about Long-Term Care.
Posted on July 11, 2006 by Jason
Reuters, July 10th, 2006
Retirees who do volunteer work in schools may help not only children but their own health as well, a study suggests.
Researchers
at Johns Hopkins University in Baltimore found that older adults who
served as mentors and tutors in their local elementary schools became
more physically active in their daily lives.
Those who were
sedentary before joining the volunteer program, called Experience
Corps, more than doubled their physical activity levels during the
school year, according to findings published online by the Journal of
Urban Health.
The increase was not just a result of the volunteer program
itself, the researchers found. Volunteers were more active in general,
getting more household chores and gardening done, for example, while
cutting down on TV time.
“They actually have more energy for
their daily activities,” said Dr. Erwin Tan, an assistant professor of
geriatrics at Johns Hopkins and the study’s lead author.
Read more of this article. Learn more about Working in Retirement.
Posted on July 11, 2006 by Jason
Contra Costa Times, July 10th, 2006
The federal
government, in its wisdom, doesn’t want us to spend all our retirement
money too quickly. So the tax man charges a 10 percent penalty to
discourage anyone from tapping into their Individual Retirement Account
before age 591/2.
There is a way around it, though.
Section 72(t) of the Internal Revenue Code allows people to withdraw
money from their IRA penalty-free before age 591/2, provided the
withdrawals are in “substantially equal periodic payments” for at least
five years.
Sounds simple enough, but it’s not. And an increasing number of
early retirees are being whipsawed by the temptation and the complex
rules that come with it.
“This section is creating a lot of havoc for early retirees,” said
Mark McClanahan, a certified financial planner at Baker Financial
Services in Arlington.
“I see this almost every day because there have been a lot of company buyouts in recent years.
“And people are retiring early, but they just don’t understand this law.”
Read more of this aritcle. Learn more about Retirement Plans.
