Squared Away Blog

The housing market has shrugged off the pandemic, and home prices are rising sharply due to historically low interest rates. The market crash more than a decade ago is a distant memory. The total value of the equity in older Americans’ homes has doubled since 2010, hitting $8.05 trillion at the end of last year. The irony is that federally insured reverse mortgages, which allow a long-time homeowner to cash in on tens of thousands of dollars of equity, aren’t very popular. Last year, only 42,000 Home Equity Conversion Mortgages (HECMs) were sold – half as many as in 2010 – according to the U.S. Department of Housing and Urban Development (HUD). One reason HECM reverse mortgages haven’t caught on,…

The oldest minority retirees are struggling with debt, a new Urban Institute study finds. The researchers’ starting point is that people generally reduce their debt as they age. To prepare for retiring, older workers try to pay down their mortgage balances and pay off credit cards. Once retired, their debt continues to shrink. But on closer inspection, retirees in their 70s and 80s in the nation’s predominantly minority neighborhoods have shed less of their debt than their counterparts in mostly white neighborhoods, who tend to be better off financially. In a sign of financial distress among the oldest lower-income and minority retirees, 20 percent of their loans go to collections for non-payment – double the rate for higher-income and whit…

The states’ health insurance marketplaces will sell subsidized family policies to workers who have employer coverage on one condition: their employer premiums are deemed unaffordable. But this condition has a quirk. Under the Affordable Care Act (ACA), a worker is eligible to buy a subsidized family plan only if he can’t afford his employer’s premiums for an individual policy, defined in the law as exceeding 9.83 percent of his income. Policymakers argue this is the wrong standard, because the ineligible worker needs a family policy, and employers’ family policies usually have much higher premiums than their individual policies. The Kaiser Family Foundation estimates some 5.1 million workers are in this predicament, which is known as the “family glitch.” The majority…

“Supernova” does not have a happy ending. But that’s how stories about Alzheimer’s go, and the film, which recently began streaming, is worth watching. It’s one of those occasional movies that come along and portray the emotional aspects of this disease with nuance. The films, by using big-name stars like Stanley Tucci and Colin Firth in “Supernova,” lift some of the stigma around dementia that can isolate its victims and their caregivers. Dementia “is still very much a taboo topic,” said Bobbi Matchar, who, as director of the Duke Dementia Family Support Program, facilitates group discussions for people with dementia and their families. “Having movies that more accurately portray the face of dementia is really helpful.” The newest of thes…

U.S. fertility is already at record lows, and women in their 30s have had only 1.3 children on average – well short of their expectations for more than two children. But they still have time left on their biological clock. So, will they catch up? Several factors are working specifically against the college graduates in this cohort. Religiously observant people usually have more children, and the decline in religious affiliation is reducing their fertility. Their fertility is also being hurt by the falling marriage rate, which leaves fewer couples ready to raise a family. In addition, the women’s careers often compete with having children. In a new study, Anqi Chen and Nilufer Gok at the Center for Retirement Research predicted…

Gayle Blanton, the blogger’s mother My 85-year-old mother is on top of her bills. She pays several of them online, which is impressive enough, and she knows which bill is due when. So, we should both take some comfort in the fact that she is not having difficulty managing her money, which is an early sign of dementia. The connection between poor money management and declining cognitive capacity was established in research years ago. An obvious next question – when does this early warning system kick in? – is answered in The Journal of the American Medical Association. The researchers followed more than 81,000 men on Medicare for more than a decade and linked their medical records to their Equifax…

About 13 percent of the older people in a recent study – average age 74 – who were initially living independently moved into a nursing home within five years. Perhaps because they know their vulnerabilities, their expectations of whether they would one day need nursing home care helped predict their actual nursing home use, the study found. In fact, the researchers said, the accuracy of the predictions showed that the older people must have taken into account personal information that went beyond what was apparent in the 1998-2016 survey data used in the study, which included details about their health, ease of functioning, and other influences on whether they need care. However, foresight did not translate into facing up to…

The annual pay for a plumber in Omaha, Nebraska, with three years of experience is around $55,000 a year, while a certified nursing assistant there earns $30,000. Or compare an electrician in the Phoenix area making $62,000 to $39,000 for a dental assistant. Recognizing that many of the occupations dominated by women don’t pay well, young women of color are increasingly moving into the construction trades. Black, Latina, and Asian women and women of mixed race account for 45 percent of the 308,000 women working in the trades. This exceeds their 38 percent share of the women’s labor force overall, according to an analysis of 2016-2018 data by Ariane Hegewisch of the Institute for Women’s Policy Research. The largest grou…

Do applications for federal disability benefits rise, fall, or remain unchanged when the minimum wage increases? Understanding whether the minimum wage affects disability applications is an important issue as Congress debates an increase in the federal minimum and the states have been very active: 14 states began last year with a higher minimum wage after passing new legislation or ballot initiatives. Another seven states had previously enacted automatic yearly increases in their minimums. One possibility considered in a new study is that applications to the U.S. Social Security Administration for disability benefits could decline if wages increase enough to make a steady paycheck that much more appealing than a modest monthly disability check. But Syracuse University economist Gary Engelhardt finds…

It’s difficult to envision what life will look like on the other side of the consequential decision to retire. But research can help demystify what lies ahead – about the decision itself, the financial challenges, and even the taxes. Readers understand this, as evidenced by the most popular blog posts in the first three months of the year. Here are the highlights: The retirement decision. The article, “Retirement Ages Geared to Life Expectancy,” attracted the most reader traffic. Myriad considerations go into a decision to retire. But a sense of whether one might live a long time – because of good health or simply seeing that parents or neighbors are living unusually long – is a compelling reason to postpon…

If people need to work and can work, they will work. That’s my takeaway from a new set of data that sketches a clearer picture of U.S. workers who are holding down multiple jobs. Nearly 8 percent of workers had two or more jobs in 2018, the latest year of data available from the U.S. Census Bureau. The data also show that holding two or more jobs becomes more common during economic expansions, when jobs are plentiful, and falls during recessions, when the opportunities dry up. But the longer-term trend is up: the share of people holding multiple jobs has slowly increased over the past two decades. In a recent webinar, Census Bureau economist James Spletzer provided a couple of…

For half to two-thirds of the college loans made over the past decade, the former students owe more than they initially borrowed. This is the result of a federal program that bases monthly student loan payments on the borrowers’ income if they aren’t earning enough to afford the standard payments. But the monthly payments in these much-needed Income Driven Repayment (IDR) plans are often less than is required to fully service the principal and interest on the loans. So instead of getting ahead, borrowers are perennially behind and never chip away at the balances. People who go into the repayment plans are “trying to bail out a boat with a bucket that has a hole in it,” said Betsy Mayotte,…