Squared Away Blog

Sky-high city rent, college loan payments, and the low-paying days of an early career are a bad combination for today’s Millennial. Liz Patterson Liz Patterson has solved all that.  The carpenter built herself a 96-square-foot house on top of a flatbed truck for less than $7,000 in Manitou Springs, Colorado, a hip neighborhood near Colorado Springs. The house “represents my monetary freedom – it’s the whole reason I did it,” the 27-year-old said. Tiny houses, which average 500 square feet, are only about 1 percent of U.S. home sales. But builders say that sales continue to grow as Generation-X buys them as Airbnb rental properties, and baby boomers park their “granny pods” in an adult child’s backyard. Patterson’s house befor…

Karen Dobson Kay Dobson is 68, and it’s time to retire from her job as the jack of all trades at the Augusta Circle Elementary School in Greenville, South Carolina. But she isn’t quite as ready for her June retirement as she could’ve been. She recently learned that an admitted unfamiliarity with Social Security’s arcane rules cost her about $31,000 for two years of foregone spousal benefits based on her husband’s earnings. “I had not the vaguest idea that I would be eligible for that,” she said. Dobson is hardly the first person to make a painful mistake like this. People have all kinds of misconceptions about Social Security, or they lack a basic understanding of how it works – that…

Diane Taylor Betty Taylor is 74 and retired from a job she held for more than a decade filling Spiegel catalog orders and packing them up for shipping – she left in 1984. Diane Taylor, 70, was a packer and then a keypunch operator there between 1982 and 1995. But the sisters, who live together in their late mother’s house on Chicago’s Southwest Side, couldn’t track down anyone who could confirm that their low-paying jobs entitled them to Spiegel pensions. This is more common than one might think. When a single employer or union has continued to maintain its pension plan over several decades, retiring workers know where to go to sign up for their benefits. But the sisters’ pensions…

Caregiver in a nursing home can be grueling work, but my aunt loved it. In one of life’s cruel ironies, she died soon after retiring to take care of her husband, who is developing dementia. The great responsibility for his care fell suddenly on his children and grandchildren, and they’re struggling with it. I texted this video to a couple of my uncle’s daughters because it provides invaluable information and insight into the myriad causes of Alzheimer’s and the unique way its symptoms manifest in each individual. It also explains why diagnosis by a physician is critical – turns out, some people appear to have dementia, but the cause of their cognitive decline isn’t Alzheimer’s and may be reversible. T…

When once-simple financial tasks become difficult or confusing, it can be the canary in the coal mine signaling that an elderly person is developing dementia. Financial problems will soon follow once people with cognitive impairment start miscalculating and missing payments, forgetting and misplacing accounts, or falling victim to fraud. But some good news has come out of a new study of Medicare recipients: the vast majority of the 5.5 million people over 65 with established dementia – usually, though not, always Alzheimer’s disease – are receiving help from family and other caregivers with balancing their checkbooks, depositing and withdrawing money, and conducting transactions. Even better, they are actually benefitting from it. The seniors who receive assistance are more likely to be ab…

Different people, different strategies. Myra Hindus and Jewell Jackson Myra Hindus of Boston, semi-retired at 68, had her financial adviser estimate the 401(k) withdrawals necessary to support her $4,500 monthly budget, which the adviser also prescribed. But Hindus isn’t fully at ease about her finances, despite the professional advice, a paid-off mortgage, and a good bit more savings than most people have. “It’s a bunch of guesswork,” said the former diversity administrator and consultant to major universities who hedges her bets by teaching college social work courses. What overwhelms her are the many unknowns that will determine whether her money lasts as long as she does. What if her adviser is wrong? Or what if she lives well into her…

The 1980s featured bankrupt Texas savings and loans. Then, in the mid-2000s, Countrywide failed to clearly disclose to customers the spike in their subprime mortgage payments in year 3. In 2016, 5 million customers learned about their fabricated Wells Fargo accounts. And last year, Equifax breached 140 million customers’ privacy. No wonder people are flocking to the friendly credit union in their church, labor union or workplace. The widespread fraud reports making headlines with regularity have fed a perception that “fraud happens in the banking world and a lot of it goes unpunished,” said Mike Schenk, senior economist for the Credit Union National Association (CUNA). “It’s not just Countrywide as an abstract concept. It’s that Countrywide put people into thes…

It’s a simple concept. Deposit retirees’ Social Security checks right before their big-ticket bills come, especially rent. The U.S. Social Security Administration’s current schedule for depositing pension checks in bank accounts is based on each retiree’s birth date– it can be the second, third, or fourth Wednesday of each month. The problem is that cash-strapped, low-income seniors receiving the earlier checks, on the second or third Wednesdays, can fall into a common behavioral trap: they spend the money soon after it comes in and then can’t cover the rent, mortgages or credit cards due at the beginning of the following month. According to a clever new study, people who get these early monthly checks are at greater risk of resorting…

Hyacinthe Rigaud’s portrait of King Louis XIV, courtesy of the Getty Open Content Program Tontines might be a nifty idea for retirement income. Too bad they haven’t been legal here for a century. Tontine is a fancy word for betting on how long you’ll live – in a good way. Here’s the concept in a nutshell: many people pool their money in return for guaranteed regular payouts for life, similar to an annuity. The people who live to, say 90, will receive ever-increasing financial payoffs, because the number of participants in the pool will invariably shrink over time.  The catch is that the investors who die young won’t receive as much income as the men and women who live t…

The children in this video have a delightful take on our cultural attitudes and mores about money – what it is, what it can do, and whether to share it. The interviewer borrowed the format Art Linkletter used when asking kids questions on his Emmy Award-winning television show, “Art Linkletter’s House Party,” which aired between 1952 and 1969 – as boomers and their parents will remember. The new video about kids and money is posted on the American Financial Services Association Education Foundation’s website.  The foundation’s mission is to educate people about responsible money management, starting with young children and teenagers. The adorable factor makes this 6-minute video fly by…

Two new “sandwich generations” are getting into the thick of things: Generation X and Millennials. Baby boomers first latched onto this label as they juggled caring for their parents and children simultaneously.  With lifespans continuing to increase, the squeeze from parental caregiving is tightening among Gen-X and Millennials. As baby boomers and their parents get older, all three generations are feeling the financial strain of this familial obligation, which people take on either because “it is what family has always done” or “there was no other option,” according to caregivers’ responses to Northwestern Mutual’s new annual survey of adults between the ages of 18 and 64. A separate 2017 report, by the Center for Retirement Research, estimated that one in five people will,…

A retiree’s sources of money are often described as a three-legged stool: Social Security, pension, and savings. But many seniors’ financial support looks more like a single, sturdy pillar: Social Security. This is shown dramatically in new U.S. Social Security Administration (SSA) estimates of just how critical the federal program is to millions of older Americans.  The data speak for themselves: One in two retired households counts on Social Security for at least 50 percent of their total income. One in four gets virtually all income – 90 percent – from the program. The differences among myriad demographic groups also follow the usual socioeconomic patterns, according to the SSA researchers, Irena Dushi, Howard M. Iams, and Brad Trenkamp. ……