Squared Away Blog

At tax time, many Americans think, often fleetingly, about spending less and socking away more for retirement. Until April 15, the IRS permits people who do not have a pension plan at work to deduct up to $6,000 for money placed in an IRA; taxpayers who do have an employer pension can also receive the IRA deduction if their earnings fall under the IRS’ income limits. The tough question that trips people up is: How much will I need? The easy way to think about this is in terms of the income necessary to maintain your current standard of living after the paychecks stop coming in.  Click here for a tool that estimates both how much you’ll need and how…

No one really needs confirmation of how tough the Great Recession was. But the Center for Retirement Research at Boston College has quantified the decline – and it’s brutal. Investment losses and falling home prices placed 53 percent of U.S. households in danger of a decline in their standard of living after they quit working and retire, reports the Center, which funds this blog. That’s up sharply from 45 percent in 2004, prior to the financial boom, which created a strong – albeit fleeting – increase in Americans’ wealth. The longer-term erosion in Americans’ retirement prospects is even more troubling and reflects deeper issues. The Great Recession just hammered the point home. In 1989, just under one-third of Americans faced…

The flaunting of wealth that marked the Gilded Age is difficult to grasp. Forbes reports there are currently 425 U.S. billionaires, the most in any country. They tend to live in cocoons, flinching when the media write about their vast homes or other trappings of wealth. But Newport Rhode Island’s Gilded Age mansions were built for the express purpose of showcasing the unprecedented fortunes accumulated during the new industrial age. Summer residents paraded in their finery during afternoon carriage rides and held lavish parties for hundreds – sometimes thousands – on the grounds of their seaside homes, which replicated the castles that wealthy Americans saw during their European vacations. [On Aug. 16-19, The Preservation Society of Newport will host a…

The promise of America is progress, but that progress stalled for the youngest generation: U.S. workers under age 45 earned dramatically less than workers who were that same age a decade ago, the Federal Reserve Board’s latest survey shows. For Americans 35 through 44, the median household income – the income that falls in the middle of all earners – was $53,900 in 2010. That’s 14 percent less income than in 2001 when households in the 35-44 age bracket were earning $63,000, according to the Fed’s Survey of Consumer Finances released Monday. For young adults in the under-35 age bracket, median income fell to $35,100 in 2010, from $40,900 for that group in 2001. The median income also declined, by…

nasdaq_80-09 Some of Michael Najjar’s images transport people to the precarious heights of the Andes mountain range in Argentina. Others focus attention on the severe cliffs over which a mountain can slide. Using photographs taken during his climb to the summit of Mount Aconcagua, Najjar used the computer to manipulate the images of surrounding mountain ranges to track the paths of the world’s stock market indexes over the past three decades. Inspired by his ongoing interest in technology, he attempted to evoke the impact of algorithmic trading on stocks and options trading, which carves out some market peaks and valleys. “I wanted to do something extremely physical to rematerialize what has become invisible,” Najjar said in a recent telephone interview…

Chilling. That sums up a documentary about financial fraud against elderly people premiering tomorrow at the Quad Cinema on 13th Street in Manhattan. “Last Will and Embezzlement” is about fraudsters who seek out vulnerable elderly people suffering from cognitive decline for no other purpose than to exploit their trust and steal their money. It’s not uncommon for these con men and women to be family. By first-time producers Pamela Glasner and Deborah Louise Robinson, the film would’ve benefitted from more reporting and more focus – they try to do too much when they get into court systems and solutions. But the film does what journalism does best: It finds people willing to tell personal gripping stories – not easy to…

Tried-and-true financial frauds – Ponzi schemes, high-yield investments, and “pump and dump” stock scams – have victimized unsuspecting targets for decades, even centuries. These well-known frauds are effective, because con men change their disguises so they won’t be recognized. Six common disguises are detailed in a report I wrote for the Financial Security Project at Boston College’s Center for Retirement Research, which hosts this blog…

You have to admire a financial writer and editor with the guts to put this on his LinkedIn profile: “While many Wall Street people go to Harvard or Yale University to learn about business, Ron went to art school.” The cartoons shown here are in a humorous financial book by Ronald DeLegge 2d, who said he first earned his chops as an insurance salesman at a small Midwestern company that eventually became part of AIG. His cartoons appear in “Gents with no ¢ents: A closer look at Wall Street, its customers, financial regulators, and the media.” Dave Clegg was the illustrator. Enjoy…

“Money Matters,” a play that opened last weekend in Cambridge, Mass., demonstrated the financial wit of its teenage actors at the same time that they – and the audience – embraced the complexities of money. Credit versus debt, income differences among classmates, money and relationships, certificates of deposit, needs versus wants – this only scratches the surface of the subject matter in the Youth Underground theater production, which begins touring the Boston area in February. The actors clearly were having fun, but their performance served as an educational tool that might be replicated. For example, the screenplay was based on the actors and other teenagers’ 80-some interviews of community residents about their financial viewpoints and mishaps. The stories generated ideas…

Money and cheating go hand in hand – now add art to the mix. An art exhibit was inspired in part by the research that found a “robust relationship between creativity and dishonesty” by Francesca Gino at the Harvard Business School and Dan Ariely of Duke University, a behavioral economist who founded Duke’s Center for Advanced Hindsight, the location of the exhibit. What does the art say to you – about financial planning, the scammers who slink among us, or our money culture? Squared Away picked pieces by two of the exhibit’s 22 artists, who are from North Carolina, Israel and elsewhere. The artists’ explanations are included with their work: ……

Occupy Wall Street protesters have made their feelings known about the widening U.S. wealth gap. So, what do the rest of us think? A Harvard Business School professor – Michael Norton – and a behavioral economist – Dan Ariely – teamed up to ask people their preferences when it comes to the distribution of wealth. They found that Americans of all types and political affiliations “vastly underestimated” the magnitude of the difference between rich and poor in this country. At a time many people are suffering in the slowing economy and languishing job market, it’s interesting to see a comparison between what Americans believe about U.S. wealth distribution and the reality they inhabit. The American rags to riches myth endures…

In this humorous Ted video, Graham Hill advocates minimalism as an alternative to consumerism and showcases his 420-square-foot apartment in Manhattan. His living arrangement may seem extreme but residents of Tokyo have been living small for years, and his main point is well taken: he has reduced both his living expenses and his environmental footprint. Hill is a modern Renaissance man. He studied architecture, founded Treehugger.com to take environmental sustainability mainstream, and dreamed up the idea for those ceramic Greek coffee cups, a replica of the paper cups, found in art museum gift shops. “From his New York home, he schemes daily about how he can help humanity avoid rapid extinction,” according to his bio…