Squared Away Blog

More than 10 percent of the nation’s retirees struggle with hunger. New research offers one explanation: when people retire and give up a regular paycheck, they sometimes adjust to having less income by reducing their food intake. After retiring, the men in the study ate 17 percent less protein, which becomes more important as people age. Their total calorie intake also dropped 19 percent, and their Vitamin E consumption fell 16 percent, on average, according to researchers at the University of Michigan and University of Delaware. The retirees also cut back on several other nutrients. This contradicts previous studies, which had failed to uncover a link between diet and retirement income. Skeptical of the findings, the researchers did an exhaustiv…

As retirees’ health declines, their medical costs go up. These costs include both everyday healthcare expenses and long-term care costs. The everyday expenses that Medicare does not cover – Part B and Part D premiums, copayments, eyeglasses, and dental care – consume about 20 percent of the incomes of households ages 75 and over. While not exactly good news, 20 percent is “perhaps manageable” for most, concluded researchers at the Center for Retirement Research in a summary of various studies in this area. The real problem comes for the unlucky minority – about 5 percent of seniors – who spend more than half of their income out of their own pockets for healthcare. Turning to long-term care, these services are less…

Since only about half of all private sector workers currently have access to an employer 401(k) plan, it’s not at all unusual for spouses who are both working to have only one saver in the family. When that’s the case, is the person who is contributing to the employer retirement plan saving for two?  The answer is definitely not, concludes a new study by the Center for Retirement Research. The challenge for couples living on two paychecks is that they have to save more money to maintain their current lifestyle after they retire. But households with two earners and only one saver end up saving less than others – only about 5 percent of the couple’s combined incomes, compared wit…

One in four workers in their mid-50s will eventually encounter difficulties on the job, because their bodies start breaking down or they aren’t as sharp as they used to be. When a new, disabling condition is long-lasting, 63-year-olds – still a young age to be retiring – are two times more likely to stop working than other people their age, according to a new study by Mathematica, a Princeton, N.J., research firm. The researchers started out with a fairly healthy group of 55-year-olds and followed their career paths through age 67. Strikingly, even people as young as 59 who have experienced a new work-limiting health condition leave the labor force at a much higher rate than those who did not…

My divorced aunt did not work while she was raising eight children. After her former husband died, she was pleasantly surprised to learn she could start collecting his Social Security. She has a lot of company. Nearly two out of three men and women in a new survey by RAND were unaware of this rule: a divorced person who was married for at least 10 years is entitled to the deceased spouses’s survivor benefit. In fact, she would even get the benefit if he remarried. In the case of couples who were still married when the spouse died, the marriage had to last only nine months for the survivor to get the benefit. Fewer than half of the people surveyed…

The perils of aging generally escalate around 75, and they are becoming more pervasive as more Americans live to very old ages. One of these perils – declining cognitive ability – often creates financial problems. A new study that summarized the research on this side of the retirement equation identified the financial fallout from dementia. Currently, dementia afflicts roughly a quarter of seniors in their early 80s. And geriatricians and demographers have predicted for years that dementia will become a serious societal problem in the future as the tsunami of baby boomers reach older ages. The first sign of deteriorating financial skills might be forgetting to pay a bill. But when severe dementia sets in, the vast majority completely lose their…

Racial differences in workers’ finances are nothing less than shocking: whites have roughly six times more wealth than Latinos and black-Americans and double the income. These age-old disparities will be as familiar to readers as they are to economists. But a clear and updated picture of their magnitude was presented in a recent study. In 2016, U.S. household wealth, regardless of race, still had not rebounded to 2007 levels. But whites made a lot more progress climbing out of the hole created by the plunging stock market and housing crash that ushered in the 2008 recession. The researchers examined changes in each group’s net worth over a decade. Pre-recession, white households had five times more wealth than blacks; this ratio…

Amid a growing awareness that many Americans aren’t properly prepared for retirement, various efforts have ramped up to push the non-savers to save. A notable initiative is occurring in state government. California, Illinois, and Oregon have started IRA savings programs that require private employers to offer the state-sponsored IRAs to workers if the company doesn’t already have a 401(k). Cell phone apps are also popping up to make saving easier. One such app – Finhabits – is being marketed directly to Latinos, who financial experts say are particularly unprepared for retirement. Two out of three Latino workers aren’t saving in a retirement plan, often because they work in low-wage restaurant and hotel jobs that don’t offer one. The Finhabits a…

“We are rapidly approaching the point where we will simply be unable to afford medical care,” says Dr. Edward Hoffer. This is no exaggeration, according to the Henry J. Kaiser Family Foundation: health insurance deductibles and copayments are rising so fast that a significant share of working families have great difficulty paying for their care. “We as a society have to decide whether healthcare is a right or a privilege,” Dr. Hoffer said. “I happen to think it’s a right. We can’t all drive a Mercedes but every American deserves to have access to healthcare.” His book, “Prescription for Bankruptcy,” provides his insider’s view of why healthcare costs keep going up. For 46 years, he has worked in Massachusetts as…

In April, Trudy Schuett will have a procedure to save a tooth, which she estimates a dentist would charge $3,000 to $5,000 to do. But Schuett, who lacks dental insurance, will pay about $1,000, because the procedure will be performed by dental students at Midwestern University Clinics in Glendale, Arizona. Her cleanings at the school are affordable too. Regular clinic visits have saved “buckets of money,” she said. She is one of those resourceful retirees who always finds a way. But two out of three people over 65 do not have dental insurance, according to the Henry J. Kaiser Foundation, often because they lose the coverage when they leave their employer. Medicare does not pay for routine dental expenses, thoug…

If you don’t know this fact about Social Security, join the club. The percentage of earnings for all U.S. workers combined that is subject to the Social Security payroll tax is falling. Growing income inequality is the reason. Thirty-five years ago, Social Security taxes were levied on 90 percent of all workers’ earnings. By 2016, this taxable share of earnings had declined to 82.7 percent, according to federal data, and it will continue to drop over the next decade. The payroll tax is 12.4 percent of an individual worker’s earnings, with half deducted from his paycheck and half paid by the employer. But the tax has a cap: once earnings reach $132,900 – the cap for 2019 – they do…

A son uses his elderly mother’s ATM card at casinos and liquor stores or takes her to the bank to withdraw money from her account. A woman reports that her sister stole thousands of dollars’ worth of jewelry from their mother, who suffers from dementia. An elderly couple assigns power of attorney to their son, only to watch him sell their house and spend the proceeds he was supposed to use to create a living space in his home for his parents. News accounts like these are rare. But reports about financial abuse of the elderly are increasing. The problem lurks largely in the shadows, because parents view it as a private family affair and are loathe to file a…