Squared Away Blog

More adults are planning their funerals than are making arrangements for care in their final years of life. That’s among the revealing findings about how Americans grapple with the inevitabilities of old age in an annual survey about U.S. attitudes toward long-term care. More than 1,400 adults were surveyed in March and April by the Associated Press-NORC Center for Public Affairs Research. (NORC is a social science research organization affiliated with the University of Chicago.) “Experts believe that, like any other long-term financial planning, long-term care planning is the kind of thing you should get started with as soon as possible,” said Jennifer Benz, a senior research scientist for AP-NORC. But for many people, “it’s not even on their radar,”…

About one in three Americans trying to pay down their student loans is 90 days or more late on their payments, according to a new report by the Federal Reserve Bank of New York. This is up sharply from a decade ago, when one in five people in repayment was that far behind. The Federal Reserve estimates that 31% was the “effective” delinquency rate in 2012; it applies only to people who have actively been in repayment. The bank said this rate is a more accurate measure of the problem than the widely reported rate for 90-day delinquencies – 17 percent – which includes all borrowers, including current students and those who’ve been granted some type of loan payment deferra…

Enrollment in the Medicare Advantage plans that private insurers offer as an alternative to traditional Medicare coverage has more than doubled over the past decade, the Kaiser Foundation reports. The share of the Medicare population enrolled in these private plans is 30 percent, up from 13 percent in 2005, the non-profit foundation said. The reason for this dramatic growth: Medicare Advantage became a better deal for older Americans in the wake of a 2003 increase in federal subsidies to insurance companies offering the plans. The federal government subsidizes insurers through its reimbursements for the care they cover for older Americans enrolled in Medicare Advantage. Those payments were increased in 2003. Insurers responded by reducing beneficiaries’ copayments and cost-sharing in t…

A new study estimating that just 12 percent of low-income older Americans save in a 401(k) or similar employer retirement plan also suggests that many more would save – if only they could. The researchers – April Yanyuan Wu, Matt Rutledge, and Jacob Penglase of the Center for Retirement Research – focused on individuals between ages 50 and 58 with household incomes below three times the poverty line. That was less than $36,357 in 2010 for a one-person household, for example, and less than $46,800 for two people. The period studied spans 1992 through 2010. Retirement saving primarily takes place in workplace plans. But to participate in a plan, workers must clear four hurdles. First, they need a job. Next,…

A new study provides important insights into American workers’ household budgets. The study found that when workers sensed a growing likelihood they might lose their jobs, they quickly pared their spending on a large and diverse basket of discretionary consumer goods. These included both standard purchases and big-ticket items, from gardening supplies and vacations to cars and dishwashers. The analysis was based on a survey of some 2,500 workers who were asked about their spending patterns and also asked to estimate their own chances of becoming unemployed over the coming year. The survey was conducted between 2009 and 2013, when the U.S. jobless rate at one point approached 10 percent. ……

Despite the growing tendency of Americans to migrate around the country for a job or retirement, half of all adults still live less than 25 miles from their mothers. Such details about basic family living patterns were described in this video featuring Janice Compton, an economist with the University of Manitoba, who conducts research on the relationship between geographic proximity to older parents and who cares for them. The vast majority of hands-on caregivers are family members. And elderly women, who tend to live longer than men, are more often the ones who receive care from their children. To determine who’s most likely to stay near mom – and be in a position to assume care-giving duties – Compton and…

Half of all American adults view their top financial goal as making sure they have enough money to retire, finds a survey conducted in early April and released last week by the National Endowment for Financial Education (NEFE). That’s barely changed from 47 percent who said so in NEFE’s 2011 survey. These figures are unimpressive if one considers that most everyone eventually retires. Further, fewer than one in five U.S. workers has the luxury of a traditional defined benefit plan that will send them a pension check every month. Saving for retirement hasn’t gotten any easier either: two of three adults in the NEFE survey identified an inability to save enough as a major financial obstacle. That sentiment may b…

The earnings gap between working men and women has narrowed somewhat over time, but it’s considerably wider for older women. Women who are now on the cusp of retirement and working full-time earn 67.5 cents for every dollar men their age earn – or 8 cents more than working women who were the same age (in their late 50s and early 60s) during the 1970s. For younger women, the pay gap persists but things are brighter.  Women in their late 20s and early 30s today earn 84 cents for every dollar a young man earns.  That’s a 20 cent gain over women who were their age back in 1970. These are among the myriad statistics documenting the history of t…

Consider this difficult situation: An elderly woman lends her oldest son $20,000 to help pay for some expensive medical care for his teenage son – her grandson – who’s stricken with cancer. When the woman writes her will, a different son who is also her executor – and happens to be an accountant – advises her to deduct the $20,000 loan, never repaid, from the oldest son’s modest inheritance. This happened in my family, and I was of two minds at the time.  Technically, the money was a loan – not a gift – so not paying it back was unfair to the other siblings who didn’t receive $20,000. But it seemed uncompassionate to take the money out of a…

The nation’s job market regained some of its momentum in March.  But it’s not just getting a job that’s key to gaining financial security – it’s about getting and keeping a quality job. In a recent report, the Institute on Assets and Social Policy at Brandeis University used interviews with workers around the country to identify three aspects of a job – beyond the size of the paycheck – that help people save money and bolster their financial security.  [Excerpts from some of the interviews are shown.] The report also gave some indications of how common it is for workers to go without them: Benefits – Employer health care, disability insurance, a 401(k) retirement plan with an employer savings match,…

As a young adult starting my career in Chicago in the 1980s, I didn’t have a clue how Social Security worked or why money was being taken out of my scrawny paycheck. But trust me on this: the Social Security retirement program becomes a lot more interesting to workers as they age and their retirement horizon comes into sharp focus.  It affects just about every American – and most of us pay into it. It is not only the bedrock of retirement for millions of Americans and their spouses, but it’s also a source of income for their survivors, including children, and workers who become disabled. In this video, officials from the U.S. Social Security Administration explain what its programs…

Only about half of all U.S. workers in the private sector participate in retirement savings plans at their current places of employment, according to a new report by the Center for Retirement Research. Pension coverage in this country “remains a serious problem,” concludes the Center, which also sponsors this blog. The goal of the Center’s report is to make sense of the myriad estimates of how many Americans are covered at work. One prominent source of data is the federal government’s survey of employers, the National Compensation Survey. The NCS shows that 78 percent of full-time workers, ages 25 through 64, have some type of defined benefit or defined contribution plan available to them at work. But that’s the rosiest…