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For Some Retirees, Home is Where the Debt is

Today’s pre-retirees and retirees tend to have far more debt than those in years past. In addition to factors like credit card payments and medical expenses, this generation is seeing the effects of higher home prices and easily obtained low down-payment mortgages in the early 2000s.1

Between 2003 and 2016, Americans 60 and older nearly tripled their household debt — composed of mortgages, home equity loans, auto loans, student loans and credit cards.2 According to the Employee Benefit Research Institute, households headed by a person age 75 or older held an average debt load of $36,757 in 2016.3

If you’re still carrying a fair amount of debt and nearing retirement, we can help you review your household budget to help plan for a more confident retirement. Please give us a call if you’d like to schedule a meeting.

One of the challenges in the new tax law is the interest-cap deduction on mortgage loan payments, meaning homeowners with high mortgage balances may be required under the new law to deduct less mortgage interest. The mortgage limit on new homes purchased is $750,000, while the limit on mortgages purchased before Dec. 15, 2017, remains $1 million.These numbers are important if downsizing is part of your debt-reduction strategy.4

Another major contributor to debt is the rising cost of sending children to college. Of the 3.5 million Americans who owe an average of $24,000 in Parent PLUS student loan debt, about half of them are parents older than age 50. Worse yet, the number of parents with student loans is rising at a faster rate than students.5 Unfortunately, all those debt payments could be used to save for retirement.

The No. 1 reason individuals file for bankruptcy is medical debt.6 Whether nearing retirement or already there, unexpected health care costs can seriously curtail retirement funds. It’s a good idea to work with a financial professional to develop a strategy for paying potential health care costs down the road.

 

Content created by Kara Stefan Communications.

1 Rebecca Moore. PlanAdvisor. Jan. 10, 2018. “Debt Causing Financial Vulnerability for Pre-Retirees.” https://www.planadviser.com/debt-causing-financial-vulnerability-pre-retirees/. Accessed May 11, 2018.

2 Michelle Singletary. The Washington Post. Feb. 26, 2018. “Should you retire your debt before retiring?” https://www.washingtonpost.com/news/get-there/wp/2018/02/26/should-you-retire-your-debt-before-retiring/?noredirect=on&utm_term=.d3d26dc8cda2. Accessed May 11, 2018.

3 Annie Nova. CNBC. May 9, 2018. “Almost half of Americans don’t expect to have enough money to retire comfortably — but there’s some good news.https://www.cnbc.com/2018/05/09/almost-half-of-americans-dont-expect-to-have-enough-money-to-retire-comfortably–but-theres-some-good-news.html. Accessed May 11, 2018.

4 Anthony P. Curatola. MarketWatch. May 10, 2018. “Watch for these pitfalls if you want to deduct mortgage interest under the new tax law.” https://www.marketwatch.com/story/watch-out-for-these-pitfalls-if-you-want-to-deduct-mortgage-interest-under-the-new-tax-law-2018-05-09. Accessed May 11, 2018.

5 Kathy A. Bolten. Des Moines Register. April 2, 2018. “Thousands of Iowa parents are going into debt to pay for their kids’ college (and they probably shouldn’t).” https://features.desmoinesregister.com/news/parent-plus-student-loans-college-debt/. Accessed May 11, 2018.

6 Sharon Epperson. CNBC. Nov. 16, 2017. “Don’t let surprise medical bills drain your retirement.” https://www.cnbc.com/2017/11/15/dont-let-surprise-medical-bills-drain-your-retirement.html. Accessed May 11, 2018.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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Medicare News

Earlier this year, Congress passed a last-minute budget deal that included provisions affecting Medicare benefits. Specifically, one provision will permit certain therapies to continue beyond the previous caps, subject to conditions. All therapy (physical, speech and occupational) must continue to be classified as “reasonable and necessary to treat the individual’s illness or injury.” 1

 

There had been ambiguity in the past as to whether Medicare would continue paying for sessions without measurable improvement. Now, however, therapy sessions may continue per the provider’s recommendation. Retroactive for this year, once therapy billing has reached $2,010 (about 20 sessions at $100 per visit), a provider must add an extra billing code to ensure payment. However, if total expenses subsequently pass a $3,000 threshold, they may be subject to medical reviews and audits.2

 

The federal budget agreement also accelerated the share-cost reduction during the so-called “doughnut hole” period in Medicare drug plans. Starting one year earlier — in 2019 — Medicare beneficiaries will pay 25 percent (instead of 35 percent) of drug expenses once they reach the stated annual limit (currently $3,750 in 2018).3

 

Medicare rules are always changing. It’s a lot like trying to make retirement planning decisions throughout your career — the bar is a moving target. One potential solution is to over-plan and overfund your share of expected health care expenses in retirement. If you’re looking for ways to help plan for possible increased health care expenses in the future, contact us.  We’d be happy to discuss your options based on your unique situation.

 

In April, the Centers for Medicare & Medicaid Services (CMS) issued a final ruling with updates for Medicare Advantage (MA) plans to provide more choices. Specifically, the rule expands the definition of “primarily health-related” benefits to cover products and services not considered direct medical treatments. Examples include air conditioners for people with asthma, healthy groceries, rides to medical appointments and home-delivered meals. Paid benefits also may include home modifications for mobility and balance, such as installing a wheelchair ramp or bathroom grab bars. Plans may offer benefits to help pay home aides who help with dressing, eating and other personal, daily-living care. MA plans must submit their bids for CMS approval by June 4 to begin offering these benefits in 2019.4

 

The new CMS rule also includes initiatives to address the national prescription opioid epidemic. Specifically, Medicare Part D plans now limit new opioid prescriptions for acute pain management to no more than a seven-day supply. The Overutilization Monitoring System (OMS) is expanding, increasing pharmacist accountability for patients already taking opioids.5

 

The CMS rule is part of a hardline approach to combating the opioid crisis. The White House has established a Safer Prescribing Plan initiative with specific goals that include cutting nationwide opioid prescription fills by one-third within three years.6

 

Content created by Kara Stefan Communications.

 

1 Judith Graham. Kaiser Health News. March 29, 2018. “Scrutinizing Medicare Coverage For Physical, Occupational And Speech Therapy.” https://khn.org/news/scrutinizing-medicare-coverage-for-physical-occupational-and-speech-therapy/. Accessed May 4, 2018.

2 Ibid.

3 Susan Jaffe. Kaiser Health News. March 14, 2018. “Lifting Therapy Caps Is A Load Off Medicare Patients’ Shoulders.” https://khn.org/news/lifting-therapy-caps-proves-a-load-off-medicare-patients-shoulders/. Accessed May 4, 2018.

4 Bruce Japsen. Forbes. April 5, 2018. “How Trump’s New Medicare Rules Boost Amazon And Walmart.” https://www.forbes.com/sites/brucejapsen/2018/04/05/how-trumps-new-medicare-rules-boost-amazon-and-walmart/#600a42d6786c. Accessed May 4, 2018.

5 CMS. Fact Sheets. April 2, 2018. “2019 Medicare Advantage and Part D Rate Announcement and Call Letter.” https://www.cms.gov/Newsroom/MediaReleaseDatabase/Fact-sheets/2018-Fact-sheets-items/2018-04-02-2.html. Accessed May 4, 2018.

6 The White House. Fact Sheets. March 19, 2018. “President Donald J. Trump’s Initiative to Stop Opioid Abuse and Reduce Drug Supply and Demand.” https://www.whitehouse.gov/briefings-statements/president-donald-j-trumps-initiative-stop-opioid-abuse-reduce-drug-supply-demand/. Accessed May 4, 2018.

 

We are able to provide you with information but not guidance or advice related to Medicare. Our firm is not affiliated with the U.S. government or any governmental agency.

 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

 

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Consider Having a Backup Plan

When looking ahead in anticipation of Social Security benefits, many people expect to wait until an average age of 66 to make a claim.1

 

However, Nationwide Retirement Institute’s fifth annual Social Security survey found many retirees start drawing Social Security at the earliest possible age of 622 — frequently the result of being laid off or health issues.

 

Thirty-six percent of respondents reported health problems got in the way of living the retirement they expected, and of those, 80 percent say health problems occurred as many as five or more years earlier than expected.3

 

This tells us something we already know but are constantly reminded of: Life does not always go as planned. Many financial professionals tell their clients one of the most effective ways to help ensure enough income throughout retirement is to continue working through their 60s. This may not be preferable, but it’s an option.

 

Others may plan to work longer but end up retiring for reasons beyond their control. It’s good to have a contingency plan. As an independent financial services firm, we help people create retirement income strategies using a variety of insurance products to custom suit their needs and objectives. Give us a call if you’re interested in finding out more.

 

It’s important to have a backup plan because there are many challenges for people working longer. For example, as jobs move further into technology, artificial intelligence and automation, new job skills are constantly required. It’s good to challenge the brain, but young college graduates typically have a firmer grasp on today and tomorrow’s technology — it’s a steep learning curve.4

 

A Washington Post article recently referred to the “gray ceiling.” As women have faced the “glass ceiling” as an obstacle to career advancement, age discrimination is sometimes manifested in the hiring, continued employment, development and advancement of older workers.5

 

Fortunately, recent workforce trends have made it easier for older workers to continue earning income past traditional retirement age. Many employers have embraced the work model of the “gig economy,” staffing up (and down) as needed with independent contractors. Older workers have proven to be well-suited for this type of employment due to their laser-like experience in certain roles, reliability and stability. A recent study suggests older white-collar professionals are driving the growing demand for gig workers among businesses in certain industries.6

 

While employers may embrace the gig economy to add and drop staff as needed, remember workers can do the same. Establishing yourself as a freelancer or independent contractor gives you the freedom to work as much or as little as needed.7 You can take off a month to go on vacation, or six months to fly south for the winter. You can also take on work only when you have big bills coming up, like homeowner’s insurance or property taxes.

 

A 2017 survey found one-third of future retirees are planning part-time work to provide at least 25 percent of their household income. Besides income, many gig workers ages 51 to 70 say a primary reason for freelancing is simply to stay active in retirement.8

 

Content prepared by Kara Stefan Communications.

 

1 Nationwide Retirement Institute. April 2018. “Social Security 5th Annual Consumer Survey.” https://nationwidefinancial.com/media/pdf/NFM-17422AO.pdf. Accessed May 10, 2018.

2 Ibid.

3 Ibid.

4 James Manyika, Susan Lund, Michael Chui, Jacques Bughin, Jonathan Woetzel, Parul Batra, Ryan Ko and Saurabh Sanghvi. McKinsey Global Institute. November 2017. “What the future of work will mean for jobs, skills, and wages.” https://www.mckinsey.com/featured-insights/future-of-organizations-and-work/what-the-future-of-work-will-mean-for-jobs-skills-and-wages#part%205. Accessed May 1, 2018.

5 Susan Williams. Booming Encore. March 2018. “Older Workers Watch Your Head – Breaking Through the Gray Ceiling.” http://www.boomingencore.com/older-workers-watch-head-breaking-gray-ceiling/. Accessed May 1, 2018.

6 Valerie Bolden-Barrett. HR Dive. Oct. 3, 2017. “Older workers — not millennials — are driving the gig economy.” https://www.hrdive.com/news/older-workers-not-millennials-are-driving-the-gig-economy/506349/. Accessed May 1, 2018.

7 Elaine Pofeldt. Forbes. Aug. 30, 2017. “Why Older Workers Are Embracing the Gig Economy.” https://www.forbes.com/sites/elainepofeldt/2017/08/30/why-older-workers-are-embracing-the-gig-economy/#642f904a42ce. Accessed May 1, 2018.

8 Ibid.

 

This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

 

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Technology Pros and Cons

Not all innovations are initially successful. Think about the driverless car. It sounded like a great idea — helping the disabled and elderly retain some independence — until the first pedestrian fatality involving a driverless car occurred in Arizona this year.1

Driverless technology may be a work in progress, but it may still have advantages. After all, the technology could reduce the number of cars on the road and their greenhouse gas emissions. America’s parking lots consume more land than Delaware and Rhode Island combined, and the average privately owned car in the U.S. is used only 5 percent of the time, sitting parked the rest of the time.

We deal with the pros and cons of new technology every day. We love our smartphones, often relying on them too much — like when the battery goes dead and GPS navigation disappears. After all, who carries a map in their car these days? These lessons can be applied to other aspects of life, like carrying insurance for an item we no longer use, such as a boat or a lost piece of jewelry. Take stock and see if there are goods, services or habits you do not need and are costing you money. Sometimes our conveniences create more problems than they solve. 

While you’re in the mood to take stock, consider giving us a call to review your current retirement income strategy. We will be happy to help you make sure it aligns with your goals for retirement.

Social media is another area that has revealed both pros and cons. It has been a wonderful invention for keeping family, friends and colleagues in touch, regardless of location. Then Facebook announced that 87 million users’ data was used by a political consulting and data brokerage firm.3 One of the data scandal’s most interesting revelations was, while a social media user may carefully control who sees his or her personal information, any time we friend, follow or otherwise link with other people exposes information to marketers who target the followed individuals.4

Other “conveniences” also may have questionable implications. Amazon recently announced it was adding an option to deliver packages to a purchaser’s locked car, in addition to the in-home delivery service launched last year. The new car delivery service uses an Amazon Key app with connection technologies common in new vehicles.5 Trusting a delivery person with access to your empty home or car — what possibly could go wrong?

Despite constant concerns about privacy and security in technology and personal data, one of the most irritating issues is keeping track of passwords. It seems we are constantly inundated with requests to change them, so much so it’s nearly impossible to keep up with which websites have which passwords. While most people recognize the need to exercise caution, two of the most common passwords used today are still “123456″ and “Password.”6

Content prepared by Kara Stefan Communications.

1 Anita Balakrishnan and Deirdre Bosa. CNBC. March 19, 2018. “Uber halts self-driving car tests after first known death of a pedestrian.” https://www.cnbc.com/2018/03/19/uber-self-driving-car-fatality-halts-testing-in-all-cities-report-says.html. Accessed April 27, 2018. 

2 Ely Razin. Forbes. March 11, 2018. “How Driverless Cars Could Disrupt The Real Estate Industry.” https://www.forbes.com/sites/elyrazin/2018/03/11/how-driverless-cars-could-disrupt-the-real-estate-industry/#61039ab013c1. Accessed April 27, 2018. 

3 Nadeem Badshah. The Guardian. April 8, 2018. “Facebook to contact 87 million users affected by data breach.” https://www.theguardian.com/technology/2018/apr/08/facebook-to-contact-the-87-million-users-affected-by-data-breach. Accessed April 27, 2018. 

4 Knowledge@Wharton. March 22, 2018. “Why the Cambridge Analytica Scandal Is a Watershed Moment for Social Media.” http://knowledge.wharton.upenn.edu/article/fallout-cambridge-analytica/. Accessed April 27, 2018. 

5 Andrew J. Hawkins. The Verge. April 24, 2018. “Amazon will now deliver packages to the trunk of your car.” https://www.theverge.com/2018/4/24/17261744/amazon-package-delivery-car-trunk-gm-volvo. Accessed April 27, 2018. 

6 Matt Burgess. Wired. Jan. 2, 2018. “In 2018, it’s finally time to ditch those bad tech habits.” http://www.wired.co.uk/article/technology-resolutions-2018-improve-digital. Accessed April 27, 2018. 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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Notes on U.S. Infrastructure

The American Society of Civil Engineers has given the U.S. an overall infrastructure grade of D+. Throughout the next decade, it will take more than $4.5 trillion to fix our aging infrastructure — including upgrades to roads, mass transit, wastewater treatment plants and the electrical grid.1

We’ve reached the mission-critical stage. One industry analyst observed, “We’re at the point where our infrastructure is becoming an impediment to productivity and long-term economic growth.”2

The idea of national infrastructure may remind us of personal retirement preparation. If you are still working and thinking about retirement options, consider your own “infrastructure” situation. First, are you considering relocating or downsizing, or are you committed to aging in your own home? If you prefer the latter, it’s a good idea to check out your home from top to bottom to see whether you need any major repairs or maintenance while you’re still earning a paycheck.

This inspection should include considering a new roof, checking for mold buildup in your crawl space and researching new windows or other energy-efficient features that can help lower your utility bills. Even replacing older appliances could impact your household budget once you’re living on a fixed income.

Given our dramatic weather pattern swings, we should also prepare for the possibility of a natural disaster that could affect our daily living. Consider how you might plan for a long-term disruption in power or clean water supplies, such as installing a generator, solar panels, tiles and/or a battery pack. While it may seem farfetched, remember that the citizens of Puerto Rico probably never thought they would have to adapt for long-term power outages, as seen after Hurricane Maria.3

One way the U.S. is trying to address some of these issues is by incorporating green stormwater infrastructure (GSI) in sewer overflow control and integrated wet-weather plans. The idea is to evaluate the performance of GSI systems for future development.4

With all the discussion about funding at the federal level, one little-known fact is how much infrastructure is controlled at the local level. In fact, 40 percent of the nation’s bridges and 46 percent of all public roads are owned and maintained by counties. Furthermore, counties help fund one-third of the nation’s airports and 78 percent of public transportation programs.5

The news isn’t all bad. According to the World Economic Forum, the U.S. international ranking for overall infrastructure quality improved from 25th to 12th place last year out of 138 countries. However, when it comes to specific categories, we show mixed results — the U.S. ranks second in road infrastructure spending but ranks 60th for road safety. The U.S. also lags behind other developed countries when it comes to infrastructure resilience and future sustainability.6

Content prepared by Kara Stefan Communications.

1 Merrill Lynch. 2018. “Getting a Bigger Bang for the Infrastructure Buck.” https://www.ml.com/articles/getting-a-bigger-bang-from-the-infrastructure-buck.html#financial-research-and-insights. Accessed April 20, 2018.

2 Ibid.

3 Camilla Domonoske. NPR. April 18, 2018. “Puerto Rico Loses Power — Again.” https://www.npr.org/sections/thetwo-way/2018/04/18/603569966/puerto-rico-loses-power-again. Accessed April 20, 2018.

4 Water Environment Federation. April 4, 2018. “Data analyses confirm GSI value in overflow control.” http://stormwater.wef.org/2018/04/data-analyses-confirm-gsi-value-overflow-control/. Accessed April 20, 2018.

5 Mary Scott Nabers. Infrastructure USA. April 9, 2018. “County government — a critical component of America’s greatness.” https://www.infrastructureusa.org/county-government-a-critical-component-of-americas-greatness/. Accessed April 20, 2018.

6 Hiba Baroud. PBS News Hour. Feb. 18, 2018. “Measuring up U.S. infrastructure against other countries.” https://www.pbs.org/newshour/nation/measuring-up-u-s-infrastructure-against-other-countries. Accessed April 20, 2018.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

 

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Music Plays Instrumental Role in Healing Ailments

Hearing a familiar song from a happy period in your life, such as childhood, can instantly make you feel joyful. It’s as if you’re right back there — toe tapping, head bopping and singing along. Just as with our sight, smell and taste senses, positive auditory memories can enhance mood and transport us back to a happier time.

The power of music has led researchers to study various applications of music therapy to help people overcome the pain of health conditions, emotional challenges and even the cognitive decline that often accompanies old age.1

It’s not enough to believe we will all grow old gracefully. This usually doesn’t happen without planning. A big part of planning for retirement isn’t just how to provide enough income for the rest of our life, but how to help ensure we still enjoy a high quality of life no matter our age.

As an independent financial services firm, we help people create retirement strategies using a variety of insurance products to custom suit their needs and objectives; just give us a call. As for creating a plan to help enhance quality of life, consider some of these music therapy applications.

Music therapy is now a board-certified health profession. With approximately 7,500 practitioners throughout the country, the practice has become prevalent in nursing homes and hospices. The American Music Therapy Association reports about 10 percent of musical therapists work with terminally ill patients in a new discipline called end-of-life music therapy.2

A growing body of research indicates music therapy can help improve cognitive function in patients with Alzheimer’s disease.3 It also can be used to aid in stress and pain management, memory enhancement, communication and physical rehabilitation.4

Further, the discipline has been found to help people with psychiatric problems, such as depression, trauma and schizophrenia. Music can help calm patients as well as help them process emotions, trauma and grief.5

Interestingly, the military has used forms of music therapy since the post-World War I era. Trained musical therapists use it as a tool to help wounded, injured or ill soldiers express their thoughts nonverbally. Research also shows music can be effective at increasing neuroplasticity in the brain, which is an important role in helping veterans address symptoms of PTSD and traumatic brain injuries.6

 

Content prepared by Kara Stefan Communications. 

1 Sharon Otterman. The New York Times. Jan. 15, 2018. “Music Therapy Offers an End-of-Life Grace Note.” https://www.nytimes.com/2018/01/15/nyregion/music-therapy-nursing-home-hospice.html. Accessed April 13, 2018.

2 Ibid.

3 Sherry Christiansen. Alzheimer’s Universe. July 24, 2017. “Quick Alzheimer’s Prevention Pearl: Studies Show Music Improves Cognition in People with Alzheimer’s Disease.” https://www.alzu.org/blog/2017/07/24/how-music-helps-with-alzheimers-prevention/. Accessed April 18, 2018.

4 American Music Therapy Association. 2018. “What is Music Therapy?” https://www.musictherapy.org. Accessed April 13, 2018.

5 Molly Warren. National Alliance on Mental Illness. Dec. 19, 2016. “The Impact of Music Therapy on Mental Health.https://www.nami.org/Blogs/NAMI-Blog/December-2016/The-Impact-of-Music-Therapy-on-Mental-Health. Accessed April 18, 2018.

6 Frank Otto. Drexel University News Blog. March 20, 2018. “3 Things to Keep in Mind About Music Therapy in the Military.https://newsblog.drexel.edu/2018/03/20/3-things-to-keep-in-mind-about-music-therapy-in-the-military/. Accessed April 13, 2018.

 

 

This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

 

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Demographic Differences

Consider these questions for a moment: Have your outlook and attitude toward politics and culture changed over the years? Or are you the same as always? If you were a conservative young adult, do you hold the same beliefs today? If you were a rebel as a youngster, are you still? Or have you mellowed with age?

The study of generational cohorts gives researchers a better understanding of what influences us as we age. What are the factors that influence our beliefs — parents, education, religion, career path, life experiences or opportunities to travel? Also, how much impact do the economy and social politics have? For example, millennials who saw their parents lose jobs, and even homes, during the economic recession that began in December 2007 may have a different view of the world than they would have if the recession had not been so severe.

We do change as we grow older. And certainly, our financial picture changes to reflect our needs, our wants and our goals. As you reflect on what you were like in the past and where you’re headed in the future, feel free to give us a call to discuss ways to create a retirement income plan that can help support the path you’re on now.

For the sake of generational research, think tank Pew Research Center has declared the end of an era. It has officially determined the last birth year for millennials as 1996. Pew defines millennials as anyone born between 1981 and 1996 (ages 22-37 in 2018) for its future work. People born starting in 1997 onward are considered members of a new generation.1

A lot has changed. Post-millennials are growing up in a time when social media, constant connectivity and on-demand entertainment are taken for granted. Most baby boomers (born from 1946 to 1964) will likely remember when television was still black and white, Generation X (born from 1965 to 1980) grew up with Blockbuster Video stores and Millennials embraced the age of smartphones and computer games.

This increased exposure to technology stratifies generations in ways you might expect. For example, among people who pay for their news sources, those over age 65 are five times more likely to buy a print edition rather than digital (72 percent vs. 14 percent).2

This preference carries over to reading books as well. Within the age 65+ demographic, 63 percent have read a print book in the past year, 15 percent have read an e-book and 12 percent have listened to an audiobook. Among the 18- to 29-year-old set, those numbers are 75 percent, 34 percent and 23 percent, respectively. Young adults are not abandoning books, they are simply diversifying the way they read.3

Here’s another interesting divide that seems a departure from years gone by. It’s a common perception that as we grow older, we develop healthier eating habits. Not so much anymore. Today’s millennials are very well attuned to healthy living habits. As a demographic, they smoke less, are more conscious of their diet and exercise more than previous generations at that age.4

There’s also a growing discrepancy between young and old when it comes to political beliefs. Among the “silent generation” (those born from 1928 to 1945), 52 percent lean Republican versus 43 percent Democrat. Baby boomers are pretty evenly split at 46 percent GOP and 48 percent Democrat. Millennials, on the other hand, are overwhelmingly more liberal than previous generations, with 59 percent Democrat and 32 percent Republican.5

Content prepared by Kara Stefan Communications.

1 Michael Dimock. Pew Research Center. March 1, 2018. “Defining generations: Where Millennials end and post-Millennials begin.” http://www.pewresearch.org/fact-tank/2018/03/01/defining-generations-where-millennials-end-and-post-millennials-begin/. Accessed March 29, 2018.

2 American Press Institute. May 2, 2017. “Print vs. digital subscribers: Demographic differences and paths to subscription.” https://www.americanpressinstitute.org/publications/reports/survey-research/print-vs-digital/. Accessed March 29, 2018.

3 Andrew Perrin. Pew Research Center. March 8, 2018. “Nearly one-in-five Americans now listen to audiobooks.” http://www.pewresearch.org/fact-tank/2018/03/08/nearly-one-in-five-americans-now-listen-to-audiobooks/. Accessed March 29, 2018.

4 A.T. Kearney. “Demographic Shifts.” https://www.atkearney.com/web/health250/1.-demographic-shifts. Accessed March 29, 2018.

5 Reid Wilson. The Hill. March 20, 2018. “Demographic gaps between parties widen.” http://thehill.com/homenews/campaign/379369-demographic-gaps-between-parties-widen. Accessed March 29, 2018.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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End-of-Life Issues

Before today’s modern medicine, people usually died of three things: injury, infections or some type of nutritional deficiency.1 Painkillers may have come in the form of herbal tea or some other applied root, so pain was a fact of life. Life expectancy was much shorter than today, and people often died suddenly or after a period of not feeling right but not knowing why. Most of the time, people died at home surrounded by family and loved ones.

Today, not so much. Four out of five Americans die in either a hospital or a nursing home.2 With medical advances, we are a nation both capable of and preoccupied with keeping people alive, including by artificial means.3

In accepting our eventual death, we must face the responsibility of preparing our estate and our health care proxy paperwork to help control how we face death. However, many people fail to take these actions. Recent studies revealed that nearly three quarters of adults have no health care proxy, living will or advance directive, and only 42 percent have a will.4

Whether sick or well, young or old, it’s important to maintain a will, up-to-date financial beneficiary forms and health care directive documentation. If you could use help figuring out what legal paperwork you need to complete, we may be able to refer you to a qualified attorney in our professional network.

Today, advanced medical technologies help pull us through events that in a previous era would have been fatal. We can better manage pain and multiple chronic conditions. While it’s great to live longer and feel better, that shouldn’t prevent us from considering our end-of-life preferences. After all, everyone dies sooner or later. Have you thought about how you’d like to go? Have you asked yourself if you would want more procedures to keep you alive, more time in an intensive care unit, more CPR and/or to be kept alive by machine?

Whatever your decision, make sure your wishes are known, both in legal documentation as well as in discussions with your loved ones. So many times, an elderly person will become weary of all the treatments and just want to die in peace. And just as many times, his or her family members will not accept this decision. That’s a painful problem for everyone involved.

How much health care is too much? Research on Medicare beneficiaries indicates that almost one in three undergoes an operation within a year of their death and that this event can actually do more harm than benefit.5 Other studies have shown that people who received intense care during the last six months of their life were no more likely to live longer than those who did not.6

These end of life issues do not rest entirely on the shoulders of the elderly and ill. Our health care industry focuses on prolonging life. Our physicians are drilled to “first, do no harm.” Health care is driven by the fee-for-services payment model, so doctors and pharmaceutical companies are financially rewarded for ordering more tests and screens, performing surgical procedures and prescribing medications.7

Therefore, each individual has to decide for himself or herself when enough is enough. Among terminally ill patients, 80 percent say they don’t want to die in a hospital.8 Those who complete the appropriate paperwork may have the opportunity to make this decision for themselves.

Content prepared by Kara Stefan Communications.

1 Haider Warraich. Knowledge@Wharton. Feb. 19, 2018. “How Modern Medicine Changed the Way People Die.” http://knowledge.wharton.upenn.edu/article/modern-death/?utm_source=kw_newsletter&utm_medium=email&utm_campaign=2018-02-22. Accessed March 20, 2018.

2 Ibid.

3 Ibid.

4 Kelli B. Grant. CNBC. Nov. 15, 2017. “Got a will? Here are 11 more end-of-life documents you may need.” https://www.cnbc.com/2017/11/15/12-financial-planning-documents-to-handle-health-end-of-life-care.html. Accessed March 20, 2018.

5 Liz Szabo. NPR. Feb. 28, 2018. “Too Late To Operate? Surgery Near End Of Life Is Common, Costly.” https://www.npr.org/sections/health-shots/2018/02/28/589282187/too-late-to-operate-surgery-near-end-of-life-is-common-costly. Accessed March 20, 2018.

6 Ann Brenoff. Huffington Post. July 14, 2017. “Want Control Over Your Death? Consider A ‘Do Not Hospitalize’ Order.” http://www.huffingtonpost.ca/entry/do-not-hospitalize-orders_us_59666c35e4b0a0c6f1e54ed9. March 20, 2018.

7 Liz Szabo. NPR. Feb. 28, 2018. “Too Late To Operate? Surgery Near End Of Life Is Common, Costly.” https://www.npr.org/sections/health-shots/2018/02/28/589282187/too-late-to-operate-surgery-near-end-of-life-is-common-costly. Accessed March 20, 2018.

8 Ann Brenoff. Huffington Post. July 14, 2017. “Want Control Over Your Death? Consider A ‘Do Not Hospitalize’ Order.” http://www.huffingtonpost.ca/entry/do-not-hospitalize-orders_us_59666c35e4b0a0c6f1e54ed9. March 20, 2018.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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Ideas for Your Inner Entrepreneur

One of the perks of retirement is having the time to pursue new interests. If you’ve always dreamed of starting your own business, retirement could provide the perfect opportunity.

It’s a good idea to get a financial checkup before you go full bore into entrepreneurship. We’re happy to help clients review their current retirement income situation and offer strategies through the use of insurance products to help with future retirement income needs. Please give us a call if you’d like to discuss this further.

What are the qualities of a successful entrepreneur? According to one angel investor, you don’t have to have an MBA. The following are three primary characteristics:1

1.      1. Talent. You need be able to get things done and have fanatical dedication to your cause.

2.      2. Technology. This should never be an after-thought. If you need tech to fund, produce, market, sell and/or distribute your product, then it’s just as important as your product itself.

3.      3. Traction. Your product is only “a great idea” if people are willing to pay their hard-earned cash to buy it.

Marketing is key to selling your product, and networking at trade shows and conferences is often seen as a great way to spread the word. Here are tips to help maximize these networking opportunities:2

  • Don’t just sell your product; market yourself. Let those you’re talking with know what you’re good at and what drives you.
  • If you hate networking, just smile. Look like a friendly person. Think of it as simply meeting new people, not as a make-or-break event. It may take a while to get your pitch down, so view every conversation as an opportunity to practice.
  • You might form a wonderful bond with another attendee, but if you can’t help each other professionally, exchange contact information and move on. Don’t waste a marketing opportunity to form a new friendship; you can do that later.

Warren Buffett once gave this advice to a 24-year-old budding entrepreneur:3

  • Before you go to sleep each night, ask yourself if you learned something new that day.
  • Pick up the phone. Don’t run away from problems; instead, confront them head-on.
  • No matter how successful you become, stay humble.

The following are three bits of wisdom from the recently departed Stephen Hawking that can help entrepreneurs problem solve and not get frustrated when they experience setbacks:4

1.      1. Always be grateful. Even when things go wrong, there are always positives to appreciate.

2.      2. Imperfection leads to opportunity. It gives us problems to solve, and therein marketable ideas.

3.      3. Never give up. Once you do, there’s no chance of success.

Perhaps you’ve been a successful entrepreneur and have sold your business for a healthy profit. You’re all set for retirement. What now? What can a person with that “go get ‘em” spirit do to stretch his entrepreneurial muscles without taking on the burden of another company?5

  • Consult. Help other entrepreneurs get the coaching they need for success.
  • Freelance. Take on temporary gigs or projects that interest you.
  • Volunteer. Devote your ability to fundraise, market and manage to a cause close to your heart.

 

Content prepared by Kara Stefan Communications.

1 Ryan Holmes. Inc. Nov. 10, 2017. “3 Ways to Test Your Next Business Idea.https://www.inc.com/linkedin/ryan-holmes/3-word-test-tell-youve-got-million-dollar-business-idea-ryan-holmes.html. Accessed March 16, 2018.

2 Alyssa Satara. Inc. March 16, 2018. “How to Avoid Wasting People’s Time — and 2 Other Networking Tricks I Learned at SxSW.” https://www.inc.com/alyssa-satara/3-networking-tricks-i-learned-at-sxsw-that-every-entrepreneur-should-know.html. Accessed March 16, 2018.

3 Karen Gilchrist. CNBC. March 14, 2018. “Warren Buffett rejected this entrepreneur’s dinner invitation — but he did give her 3 pieces of advice.” https://www.cnbc.com/2018/03/14/warren-buffett-rejects-dinner-invite-gives-3-pieces-of-advice.html. Accessed March 16, 2018.

4 Serhat Pala. Inc. March 16, 2018. “4 Lessons for Entrepreneurs from the Amazing Life of Stephen Hawking.” https://www.inc.com/serhat-pala/4-lessons-for-entrepreneurs-from-amazing-life-of-stephen-hawking.html. Accessed March 16, 2018.

5 Rob Walker. The New York Times. February 16, 2018. “When Early Retirement Turns Into a Total Bore.” https://www.nytimes.com/2018/02/16/business/early-retirement-a-total-bore.html. Accessed March 16, 2018.

 

 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

 

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A Look at How America Ranks

In his first year in office, President Trump has promoted his “America first” philosophy. This new focus, with its trade protectionism and tough stance on immigration, has somewhat changed the U.S. narrative on a world scale.1

Considering this new emphasis on America first, perhaps it’s worth looking at how the U.S. ranks on the world stage, according to various lists measuring financial health, happiness, education and more.

One of the most watched rankings for financial health is the annual World Economic Forum Global Competitiveness Report, which covers 137 economies and ranks the U.S. as No. 2. The Global Competitiveness Index measures national competitiveness, which includes a variety of institutions, policies and factors that determine each country’s level of productivity. The following are the top 10 countries ranked by the 2017-2018 Global Competitiveness Index:2

  1. Switzerland
  2. United States
  3. Singapore
  4. Netherlands
  5. Germany
  6. Hong Kong
  7. Sweden
  8. United Kingdom
  9. Japan
  10. Finland

According to the recently released “2018 Best Countries” listing from U.S. News & World Report, America is ranked No. 8 behind Switzerland, Canada, Germany, the U.K., Japan, Sweden and Australia.3 The Best Countries rating is based on opinions of over 21,000 people from 36 countries in a wide variety of categories, including business friendliness, entrepreneurship, citizenship, power, quality of life, cultural influence and more.4

However, America gets lower marks in the rankings of countries with the happiest residents. The U.S. came in 19th in the 2017 World Happiness Report; Norway was No. 1. This study measures countries by ways they support happiness, such as quality of work, health care and social foundations.5

Perhaps one of the reasons Americans aren’t as happy as some other nations’ citizens has to do with our infrastructure — particularly relating to transportation. One global study of vehicular traffic found the U.S. is home to 10 of the top 25 worst cities for traffic. The study, composed of 1,360 cities in 38 countries, measures the cost of sitting in traffic due to factors such as loss of worker productivity, wasted fuel and the high cost of transporting goods in traffic. Overall as a country, the U.S. ranked fifth.6

The results are mixed when it comes to education rankings. One of the latest rankings placed U.S. 15-year-olds at 38th out of 71 countries in math and 24th in science.7

However, the U.S. ranks highest in “QS World University Rankings by Subject.” The most recent rankings place U.S. higher education institutions at No. 1 in 34 of 48 categories.8

And finally, there is one category in which America excels in vast numbers: The largest number of billionaires. Presently, the world’s billionaires account for a record $9.1 trillion combined, which is up 18 percent from a year ago.9 Seven of the top 10 billionaires in the world call the U.S. home:10

  1. Jeff Bezos (Amazon, U.S.)
  2. Gates (Microsoft, U.S.)
  3. Warren Buffett (Berkshire Hathaway, U.S.)
  4. Bernard Arnault (LVMH, France)
  5. Mark Zuckerberg (Facebook, U.S.)
  6. Amancio Ortega (Zara, Spain)
  7. Carlos Slim Helu (telecom, Mexico)
  8. Charles Koch (Koch Industries, U.S.)
  9. David Koch (Koch Industries, U.S.)
  10. Larry Ellison (software, U.S.)

Content prepared by Kara Stefan Communications.

1 Griff Witte and Michael Birnbaum. The Washington Post. Jan. 20, 2018. https://www.washingtonpost.com/world/a-year-of-trumps-america-first-agenda-has-radically-changed-the-us-role-in-the-world/2018/01/20/c1258aa6-f7cf-11e7-9af7-a50bc3300042_story.html?utm_term=.aa4bcbfc56c0. Accessed March 22, 2018.

2 Klaus Schwab. World Economic Forum. 2017. “The Global Competitiveness Report

2017-2018.” Page ix. http://www3.weforum.org/docs/GCR2017-2018/05FullReport/TheGlobalCompetitivenessReport2017-2018.pdf. Accessed March 9, 2018.

3 U.S. News & World Report. 2018. “Overall Best Countries Ranking.” https://www.usnews.com/news/best-countries/overall-full-list. Accessed March 22, 2018.

4 Deidre McPhillips. U.S. News & World Report. Jan. 23, 2018. “Methodology: How the 2018 Best Countries Were Ranked.” https://www.usnews.com/news/best-countries/articles/methodology. Accessed March 22, 2018.

5 United Nations. 2017. “World Happiness Report 2017.” http://worldhappiness.report/ed/2017/. Accessed March 9, 2018.

6 INRIX, Inc. Feb. 5, 2018. “Los Angeles Tops INRIX Global Congestion Ranking.” http://inrix.com/press-releases/scorecard-2017/. Accessed March 22, 2018.

7 Drew Desilver. Pew Research Center. Feb. 15, 2017. “U.S. students’ academic achievement still lags that of their peers in many other countries.” http://www.pewresearch.org/fact-tank/2017/02/15/u-s-students-internationally-math-science/. Accessed March 9, 2018.

8 Patrick Atack. The Pie News. Feb. 28, 2018. “QS World University Rankings show US still top, but Asia rising.” https://thepienews.com/news/qs-world-university-rankings-show-us-still-top-but-asia-rising/. Accessed March 9, 2018.

9 Luisa Kroll. Forbes. March 6, 2018. “Forbes Billionaires 2018: Meet the Richest People on the Planet.” https://www.forbes.com/sites/luisakroll/2018/03/06/forbes-billionaires-2018-meet-the-richest-people-on-the-planet/#5256507f6523. Accessed March 9, 2018.

10 Forbes. 2018. “The World’s Billionaires.” https://www.forbes.com/billionaires/list/#version:static. Accessed March 9, 2018.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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