Squared Away Blog

One might say that baby boomers on the cusp of retiring come in two varieties. Some cannot wait to retire and already have a plan. For others, the unknowns fill them with dread. How will I occupy my days? Should I do something meaningful, or is the goal just to have fun? And how do I figure this out? At 62, this writer really has no idea. For the other boomers who are feeling this way, take some comfort in knowing you are in good company. “I can’t say this strongly enough. There are some people who seem to literally not think about what their retirement might look like before they retire,” says Harvard Business School professor Teresa Amabile, whos…

Timing is everything for low-income people who rely on federal benefits to survive. For example, retirees who receive their Social Security checks early in the month and spend the money before the bills come in are more prone to fill the gap with high-cost payday loans than people who get their checks a few weeks later, a 2018 study found. New research in a similar vein shows that timing also matters for individuals who receive food aid under the federal Supplemental Nutrition Assistance Program, or SNAP. When the electricity bill arrives on or within a day of the monthly SNAP benefit, the lowest-income customers in this study were much less likely to have a past due bill or to hav…

 Romance scammers follow a predictable script. Find a willing person on social media or a dating website. Use the information she’s posted online to befriend her and then win her affection. Ask her for a loan for an urgent matter and promise to pay it back. After the money is wired, ply the victim for more money while promising to meet in person – a plan that never seems to pan out. Despite the flashing red lights that say “fraud,” romance scams are becoming increasingly profitable. Last year, its victims were cheated out of more than $200 million. This is a 40 percent increase over 2018 and exceeds the losses for any other type of scam, according to the Federal Trade Commission. Middle-aged…

Retirees are apparently unpersuaded that it’s a good idea to convert their substantial home equity into some retirement income. One way to tap this home equity is through state programs that defer older homeowners’ property taxes. The programs are offered in many states, but very few people take advantage of them. Retirees are also skeptical about the benefits of converting their equity into income using a federally insured reverse mortgage: only about 50,000 older homeowners, on average, get them every year. A big concern is that if they ever sell the house, the back taxes or the reverse mortgage must be paid back – with interest. But a new study by the Center for Retirement Research finds that this is…

Three out of four members of Generation X wish they could turn back the clock and get another shot at planning for retirement. One in three baby boomers say don’t think they’ll ever be able to retire. “Overwhelmingly, Americans are stressed about their current – and future – financial situation,” the National Association of Personal Financial Advisors said about these new survey results. Regrets about not planning and saving enough are enmeshed in our thinking about retirement. But it is really all your fault that you’re not getting it done? The honest answer to that question is “no.” There are big gaps in the U.S. retirement system that make it very difficult for many to carry the responsibility it places…

Life expectancy for 65-year-olds in the United States is less than in France, Japan, Spain, Italy, Australia, Canada, the United Kingdom, the Netherlands, and Germany. Fifty years ago, we ranked third. First, some perspective: during that time, the average U.S. life span increased dramatically, from age 79 to 84. The problem is that we haven’t kept up with the gains made by the nine other industrialized countries, which has caused our ranking to slide. A troubling undercurrent in this trend is that women, more than men, are creating the downdraft, according to an analysis by the Center for Retirement Research. The life expectancy of 65-year-old American women is 2½ years less than women in the other countries. The difference for…

Only about one in four older Americans consistently work in a traditional employment arrangement throughout their 50s and early 60s. For the rest, their late careers are punctuated by jobs – freelancer, independent contractor, and even waitress – that do not have any health or retirement benefits. Some older people are forced into these nontraditional jobs, while others choose them for the flexibility to set their own hours or telecommute. Whatever their reasons, they will eventually pay a price. The Center for Retirement Research estimates their future retirement income will be as much as 26 percent lower, depending on how much time they have spent in a nontraditional job. During these stints, the issues are that they were not saving…

Not so long ago, computers were incapable of driving a car or translating a traveler’s question from English to Hindi. Artificial intelligence changed all that. Computers have advanced beyond the routine work they do so efficiently on assembly lines and in financial company back offices. Today, major advances in artificial intelligence, namely machine learning, have opened up a new pathway to expanding the tasks computers can do – and, potentially, the number of workers who may lose their jobs to progress over the next 20 years. Machine learning works this way. A computer used to identify a cat by following explicit instructions telling it a cat has pointy ears, fur, and whiskers. Now, a computer can rapidly analyze and synthesiz…

The recent rise in Americans’ death rates is a crisis for the lowest-earning men. They are dying about 15 years younger than the highest-earners due to everything from obesity to opioids. Women with the lowest earnings are living 10 years less. But healthcare policy is doing what it’s supposed to in the states that expanded their Medicaid coverage to more low-income people under the Affordable Care Act (ACA): helping to stem the tide by making low-income people healthier. An analysis by the Center for Poverty Research at the University of California, Davis, found that death rates have declined in the states that chose to expand Medicaid coverage. The study focused on people between ages 55 and 64 – not quit…

Most people have already left their jobs before applying for federal disability benefits. The problem for older people is that when they are denied benefits, only a small minority of them ever return to work. Applicants to Social Security’s disability program who quit working do so for a combination of reasons. They are already finding it difficult to do their jobs, and leaving bolsters their case. However, when older people are denied benefits after the lengthy application process, it’s very challenging to return to the labor force, where ageism and outdated skills further complicate a disabled person’s job search. A new study looked at 805 applicants – average age 59 – who cleared step 1 of Social Security’s 5-step evaluation…

May all your dreams come true. This hope, displayed on a sign in The Villages retirement community in north central Florida, is why thousands of people flock there every year to retire. During my annual holiday trek to visit my 84-year-old mother in Orlando, my husband and I drove her to The Villages to visit her good friend who had moved there. What struck me was the contrast between its over-the-top comforts and my mother’s modest retirement community just outside Orlando, where many of the residents, who heavily depend on their Social Security, are just barely getting by. The differences in lifestyles reflect the retirement disparities that exist in this country and are a continuation of the disparities in our…

It’s smart to invest retirement savings in mutual funds that charge very low fees for one simple reason: the worker keeps more of his money and hands over less to Wall Street. But in a study of people in their 50s and 60s who have retired or otherwise left federal employment, the people with the most education and the best scores on a standardized test were more likely to make what seems to be the wrong decision. Rather than keep their retirement funds in the government’s Thrift Savings Plan (TSP), which has extremely low fees, they transferred the money to much higher-fee IRAs operated by financial companies. The $500 billion TSP – the world’s largest defined contribution retirement plan –…