Squared Away Blog

In terms of popularity, reviewing Medicare plans during the open enrollment, going on now, ranks right up there with doing taxes. Retirees on Medicare view healthcare as their most burdensome expense.  But they are less likely to comparison shop for Medicare plans than for their groceries and gas, even though plan shopping would probably save more money. Deciding on a Medicare Advantage plan or deciding to switch to traditional Medicare, with or without a Medigap supplement, is “overwhelming, scary, and has consequences, so we put it off,” said Bart Astor, a spokesman for the insurer WellCare Health Plans, whose nationally representative survey quantified just how much retirees dread Medicare enrollment. Selecting one path over another also necessitates predicting the impossible:…

Around age 58, people start getting happier. That’s what the research shows, and this blogger can attest to it. In the new video displayed below, Rocio Calvo, a Boston College professor of social work, offers up theories for the happiness phenomenon – financial security is one. She also has some particularly striking “happiness statistics” on Hispanics and immigrants. All over Boston College, academics are studying aging issues, which complement the financial and economic research turned out by the Center for Retirement Research, which sponsors this blog.   Calvo’s video is part of a series of videos by the multidisciplinary Institute on Aging at Boston College. It’s interesting viewing for older people and their families, with apologies for the regression table (t…

Edward, Ashley, and Kirby Cash Edward Cash would really rather spend his hard-earned paychecks from the Memphis Police Department on his daughter than on humdrum necessities like student loans, replacing a broken-down car, or saving. “I need money, as much money as I can to take care of this new human in my life,” Cash said about 4-year-old Kirby. Of course, he and his wife, Ashley Cash, a Memphis city planner, pay their bills, in between doting on Kirby.  But college loans are different: they get help.  The city government pays down $50 a month on each of their loan balances – as it does for some 600 employees. In May, Memphis joined Fortune 500 companies in the vanguard of employers…

Driving around major U.S. cities, it seems like every other car has a Lyft or Uber logo in the back windshield. These ride-sharing apps are prominent players in the increasingly popular “platform economy,” which links sellers with buyers of their goods and services, from used couches and basement junk to handymen and car rides. This is one corner of the fast-growing gig economy, which also includes freelancers and the self-employed. But who takes on these jobs, are they long-term or short-term endeavors, and how reliant are participants on the income they generate through online platforms or apps? Scouring its database of transactions in the bank accounts of 240,000 bank customers who participate in the platform economy, the JP Morgan Chase & Co…

Hilarious examples of “instant garbage” are offered up in this Portlandia clip by the show’s characters, Bryce Shivers and Lisa Eversman (played by Fred Armisen and Carrie Brownstein). The price point for an unwanted consumer product that becomes instant garbage is $4.99.  “We found the exact point between price and hassle that guarantees you won’t bother returning” the product, Eversman explains in the video below. Is the following theory a stretch? There seems to be a direct line between Americans’ relentless buying of stuff we do not need and our inadequate attempts at saving money. Try walking into a craft superstore or browsing Target’s $1 shelf and suddenly imagining the stuff all piled up at its ultimate destination, the loca…

The state of the nation’s health care system includes these incredible facts: Americans with health insurance who are “under-insured” have more than doubled to 41 million since 2013. They now make up 28 percent of adults. Geographic disparities can be stark. Nearly one in three Floridians and Texans is under-insured, compared with one in five in California and New York. Not surprisingly, insurance deductibles are higher in Florida and Texas. Much has been made of the fact that many Americans can’t afford their deductibles and out-of-pocket costs when purchasing polices under the Affordable Care Act (ACA).  The new report by the healthcare advocacy organization, The Commonwealth Fund, indicates that both ACA-insured and employer-insured Americans are frequently stretched to the limit…

The typical baby boomer couple had $135,000 in retirement savings last year, up from $111,000 in 2013 amid a rising stock market and a strong job market that has kept them employed, according to a report on the new Survey of Consumer Finances (SCF) by the Federal Reserve. Yet $135,000 – the balance for working couples who have a 401(k) – won’t go very far. This amount, held in both their 401(k)s and IRAs, will generate about $600 per month, said the SCF analysis by the Center for Retirement Research, which supports this blog.  That’s obviously not enough to supplement most retirees’ primary source of income: their Social Security benefits, which are slowly eroding for various reasons.  The purchasing power…

Generation X and millennials, there is time. In contrast to baby boomers, who are now mostly too old to rack up appreciable increases in their 401(k)s – though they should try – younger Gen-X and millennials have time and compounding investment returns on their side. This blog examines how they are faring – millennials, because saving and investing well now poises them for a secure retirement, and Gen-X because this “ignored” generation is sandwiched between the financial demands of parenting and parent care.  Their own assessments of their retirement preparedness appeared in a recent report by the nonprofit Transamerica Center for Retirement Studies (TCRS). Millennials “Millennials have heard the word that they need to save for retirement,” TCRS declared in its…

Behavioral economist Richard Thaler, winner of the 2017 Nobel Prize for economics, regards his field’s greatest contribution as showing that people are more likely to save if the saving happens automatically. “I’m all for empowerment and education, but the empirical evidence is that it doesn’t work,” he said in a 2015 Wall Street Journal interview. “That’s why I say make it easy.” To make saving for retirement easier, employers have increasingly turned to automated 401(k)s. Automation has taken two basic forms.  The first, automatically enrolling each employee, is pervasive and has had notable success in increasing participation in retirement savings plans.  The second form, automatically increasing the amount employees save – a concept originated by Thaler and economist Shlomo Benartzi – is…

The first thing that came to mind while listening to a recent webcast about part-time students was, Wow, people like me who attended four-year colleges are clueless about how hard it is to be a part-time student! My second thought was better summed up by one of the webcast’s panelists. Solving part-time students’ immense financial and logistical challenges “is really about economic and social mobility for a large group of citizens in our communities,” said Karen Stout, president of Achieving the Dream, a non-profit network of community colleges that promotes students’ success. Four in 10 U.S. college students are part-time and about four in 10 part-time students drop out very early in their education, according to the Center for American Progress,…

A new study of Medicare Advantage plans in 20 U.S. counties found that plans with higher premiums generally offer broader networks of physicians to their customers. “There are exceptions but there does seem to be a fairly clear relationship between how much plans are charging and the size of the network,” said Tricia Neuman, a Kaiser senior vice president and one of the study’s authors. The correlation between premiums and network size is one finding in a rare study that tries to get a handle on the quality of Advantage plans around the country amid a scarcity of data on these plans. An earlier Kaiser study looked at how many of a county’s hospitals and top cancer treatment centers are availab…

If you don’t know this chart on the Social Security website, you should: The chart shows the so-called Full Retirement Age (FRA), which is the age at which you’re entitled to your full monthly Social Security benefit, a pension based on your earnings history. Many boomers see their FRA as the time they ought to retire. But the question they should be asking themselves is: will the monthly benefit I’ll get at my FRA be enough? At a time when many Americans are in danger of not having enough money for retirement, the answer is frequently no. ……