Squared Away Blog

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 –…

How well you will live in retirement will depend on two things: your income and the local cost of living. A new study that ranks each state based on how many of its retirees can meet a basic standard of living comes up with an interesting combination of places that are financially friendly – or not – to people over 65. For example, who would expect Mississippi to be in the same company with California? The cost of living in Mississippi is much lower than in California – and most states. But 31 percent of Mississippi’s retired single people and 24 percent of its retired couples fall into what the study calls the “gap” between being poor and having barely…

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…

On Jan. 1, Arizona residents caring for elderly or disabled family members became eligible for up to a $1,000 reimbursement from the state for expenses incurred in their caregiving responsibilities. This is a trial program and the legislature allocated very little money – $1 million over two years – in a state with an estimated 800,000 residents caring for a disabled adult over 18. But it’s a start. Caregivers “aren’t asking for everything. They’re asking for a little bit to make their lives better,” said Elaine Ryan, vice president of government affairs for AARP, which has been on the forefront of advocating for such policies at the state level. “That’s the least we can do.” Arizona’s program would defray a…

The articles that our readers gravitated to over the course of this year provide a window into baby boomers’ biggest concerns about retirement. Judging by the most popular blogs of 2019, they were very interested in the critical decision of when to claim Social Security and whether the money they have saved will be enough to last into old age. Nearly half of U.S. workers in their 50s could potentially fall short of the income they’ll need to live comfortably in retirement. So people are also reading articles about whether to extend their careers and about other ways they might fill the financial gap. Here is a list of 10 of our most popular blogs in 2019. Please take a…

Next Tuesday – New Year’s Eve – we’ll return with a list of some of our readers’ favorite blogs of 2019. Our regular featured articles will resume Thursday, Jan. 2. Thank you for reading and posting comments on our retirement and personal finance blog. We hope you’ll continue to be involved in the new year. ……

Joejuan Williams Photo courtesy of the New England Patriots. Joejuan Williams, a rookie defensive back for the New England Patriots, has received a lot of attention for his practice of saving 90 percent of his game-day paychecks. He credits his frugality to a personal finance class at his Nashville, Tenn., high school. “It completely changed my life,” Williams told The Boston Globe recently. “I’m going to sacrifice now for me to be happy later.” Williams, having signed a $6.6 million contract this season, isn’t exactly living on the edge. But keep in mind that these sky-high earnings are often temporary for football players. When one considers that the average NFL career lasts about three years, Williams is just playing it…

The computer revolution, unleashed in the 1970s, has not stopped. Minicomputers replaced mainframes, and IBM introduced its personal computer. Then came the Internet, laptops, robots, iPhones, and increasingly intelligent software that can drive cars and discern music preferences. Continual technological change has reshaped and regenerated the economy several times over, creating new types of jobs unimaginable a few years earlier. But the past four decades have also been tumultuous for the workers who were either replaced by machines or couldn’t keep up with the evolving demands of their jobs. This is a pressing issue for the older workers who would benefit from working longer to improve their retirement finances. An erosion in their physical stamina or mental agility conceivably makes…

What do groceries, GPS trackers, and prescription drug copayments have in common? They are some of the myriad items caregivers may end up paying for to help out an ailing parent or other family member. And these are just the incidentals. Three out of four caregivers have made changes to their jobs as a result of their caregiving responsibilities, whether going to flex time, working part-time, quitting altogether, or retiring early, according to a Transamerica Institute survey. To ease the financial toll, some caregivers dip into retirement savings or stop their 401(k) contributions. Not surprisingly, caregiving places the most strain on low-income families. People choose to be caregivers because they feel it’s critically important to help a loved one, said…

One of retirees’ biggest fears is that they will have to go into a nursing home. This fear isn’t just psychological – it’s also financial. Roughly half of older Americans will find themselves in a nursing home at some point, according to a 2015 estimate. These stays usually last months, but sometimes years, and the costs add up quickly for those who have to pay for them out of their own pockets. At an average price of at least $225 per day for a semi-private room, a nursing home stay can put a big dent in retirees’ savings. A new study in the journal Medical Care Research and Review on how much seniors pay out-of-pocket for facilities in eight states…

College upperclassmen and recent graduates have a lot on their minds. One thing they don’t always like to think too hard about is money. Maggie Germano But Maggie Germano, a financial coach, encourages them to get things out in the open and talk about it. At a recent personal finance session here at Boston College, she answered students’ questions about their credit ratings, student loans, and how to avoid spending money they do not have. Here are the five best tips from Germano, a 2009 graduate of the State University of New York in Fredonia. She now lives in Washington D.C. Pay attention. The first step to getting control of one’s finances is to pay attention to them, she said…