Squared Away Blog

“Self-control” is a catch-all label for resisting all sorts of temptations, including overspending. According to a new study, controlling overspending can be broken down into three distinct behaviors: • Setting goals such as buying a house or saving money. • Monitoring bank statements to systematically track where your money goes. • Committing to the goal in the face of short-term temptations to spend. Data for the study came from a nationally representative U.S. survey of households over age 50. The survey has extensive information about the households’ finances and about each individual’s resolve to set goals, track their finances, and carry out their commitments – whether financial or non-financial. Households lacking self-control disproportionately have lower net worth – no surpris…

If providing healthcare to more Americans is the goal, the COVID-era tax credits for people buying insurance on the Affordable Care Act (ACA) marketplaces have been a big success. Enrollment in ACA policies has doubled to a record 24 million since 2021, when Congress approved the credits, which reduced monthly premiums by hundreds of dollars and ensured that health insurance was affordable during the pandemic. The Inflation Reduction Act of 2022 extended the subsidies through the end of this year. But the tax credits would not be renewed under some budget proposals being considered in the House. Without them, the Urban Institute has estimated enrollment in ACA policies would decline by more than 7 million and that 4 million of…

In a recent podcast, syndicated columnist Helen Dennis and I discuss her program for “renewment” as opposed to retirement. Specifically aimed at career women in or moving towards retirement, Dennis and her program co-founder Bernice Bratter have convened more than 40 groups of women working together to find fulfillment in their post-working lives. These groups of eight to ten women meet regularly, sometimes for decades, to discuss the issues they face in their later years. While each group is autonomous, they are guided by Dennis and Bratter’s book, “Project Renewment: The First Retirement Model for Career Women.” It provides prompts for discussion such as: The New Retirement Dennis explained to me that a lot about retirement has changed in recent decades. This is t…

Some 38 million family caregivers spend an estimated 36 billion hours a year caring for their loved ones. The patchwork of federal and state assistance available to them doesn’t match up to the weight of this burden. One policy in particular stands out as something they feel would help them: direct payments for their time spent as a caregiver. While this benefit exists under numerous state Medicaid programs, these programs help limited numbers of people because the eligibility requirements are very difficult to meet. Yet direct payments were by far the most popular policy option: 44 percent of the caregivers who participated in recent focus groups said this was their top choice among various options for financial assistance. Direct payments…

Paul and Sandra McCrossan live on such high ground in Toronto that their neighborhood is a popular rest stop for migrating birds. But sodden ground affected their aerie when the city experienced its highest rainfall in recorded history in August. For the first time, their basement showed traces of moisture. And for Paul McCrossan, unusually heavy rainfall due to climate change was a risk to his home that he wasn’t willing to tolerate. The couple spent $10,000 coating the outside walls of their basement to protect them from water and making sure the drains in the widow wells were clear. “These were unanticipated but not unmanageable expenses,” McCrossan, who had a long career in insurance as a risk manager, said…

What the heck is a representative payee? Social Security approves a family member or, less frequently, an organization to receive benefits on behalf of an individual who is old and infirm or has a disability. The representative is required to ensure that the benefits are being used to meet the needs of the person in their care. To gauge how well the program is working, Travis Labrum at the University of Pittsburgh conducted lengthy telephone interviews with five people with a mental illness who receive their benefits through a family member and with seven family members acting in that official role. He said that two out of three people who have family representatives managing their finances said they are fairly…

Debt is stressful. But did you know your stress level depends on the type of debt you have? Credit cards cause far more stress than first mortgages and lines of credit, a study by Ohio State researchers finds. The more striking finding is that reverse mortgages, which allow people over age 62 to tap the equity in their homes, may reduce stress – at least temporarily. The researchers used a simple example to illustrate the magnitude of credit card stress. Charging $640 on a card is as stress-producing as adding $10,000 to a mortgage. Credit cards are more stressful than home loans, because the balances on high-rate cards increase quickly when they’re not paid off, and the debt is not…

Kathleen Rehl’s husband died in February 2007, two months after his cancer diagnosis. She has taken on the mission of helping other widows process their grief, while they slowly assume the new financial responsibilities of widowhood. Rehl, who is 72, is a former financial planner, speaker, and author of “Moving Forward on Your Own: A Financial Guidebook for Widows.” She explains the three stages of widowhood – and advises women to take each stage at their own pace. Question: Why focus on widows? Rehl: After a husband dies, and whether it’s unexpected or a long-lingering death, there is a numb period. Some widows refer to it as “my jello brain” or “my widow’s brain.” It’s a result of how t…

It’s usually not talent or street smarts or brains that make people wealthy and comfortable. It’s the luck of having rich parents. But there is another way to get there, one that is within reach: becoming the first generation in the family to earn a college degree. A new study by the Federal Reserve Bank of St. Louis, using the latest federal data on household finances, measures the impact of having that degree – or not having one – on wealth and income. Although the ranks of college-educated Americans have grown over the past quarter century, people lacking a degree still make up a substantial majority – two out of three Americans. ……

Seven years ago this month, this personal finance and retirement blog debuted. How things have changed. For one thing, back in 2011, a lot more people were reading blogs and newspapers on their clunky desktop computers. In recognition of the now-ubiquitous smart phone – more accurately, a computer that happens to have a phone – we just redesigned how Squared Away looks on phones to enlarge the type and make the articles easier to read.  Our older readers will appreciate this update. Year 7 is also an opportunity to restate the blog’s mission, which, frankly, was not fully refined in the early years.  In some ways, our mission has not changed: we continue to emphasize retirement security and personal finance, with a…

Edward, Ashley, and Kirby Cash Edward Cash would really rather spend his hard-earned paychecks from the Memphis Police Department on his daughter than on humdrum necessities like student loans, replacing a broken-down car, or saving. “I need money, as much money as I can to take care of this new human in my life,” Cash said about 4-year-old Kirby. Of course, he and his wife, Ashley Cash, a Memphis city planner, pay their bills, in between doting on Kirby.  But college loans are different: they get help.  The city government pays down $50 a month on each of their loan balances – as it does for some 600 employees. In May, Memphis joined Fortune 500 companies in the vanguard of employers…

It is virtually impossible to function in the modern world without a computer or cell phone and broadband. But paying the monthly cell or cable bill can be a stretch for low-income workers and retirees. Congress recognized the importance of having access to the Internet during COVID’s months-long isolation, passing a $1.4 billion program to subsidize broadband. That program, which is run by the FCC, is running out of money. But a more modest federal program in existence since the 1980s, Lifeline, is still in operation. Lifeline subsidizes up to $9.25 per month for cell or Internet service. This is one-third the size of the COVID subsidy that’s expiring. But every little bit helps. Three groups are eligible. Workers and…