Best Ways to Save for Retirement!

By Eric Gursky
If your a young college student like me and the rest of our class you are probably wondering what are the best ways to secure a safe future. In order to best prepare for your eventual retirement there are keys steps that need to taken which will ensure a smooth ride to the finish. Start early: You can't predict market downturns or what happens to Social Security. But you can control how much you save, and the sooner you start, the easier it is to build a rock-solid nest egg
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Save regularly: Saving $4,000 might be a stretch if you're just getting on your feet. But putting away even small amounts now can make a difference.

Say you land a job making $45,000. You sign up to contribute 3 percent to the company 401(k) plan, or about $52 every other week. If you do just that for the next 40 years, you'd have about $400,000 as you near retirement

Don't Confuse Saving with Investing.

I am sure many of you are intent on saving for a house, a car, higher education or something else. By all means, continue saving, but don't invest your savings in stocks and stock mutual funds if you plan to make a large purchase within the next four to five years. Remember, investing will work wonders for you, if and only if, you put time on your side. Time periods of less than five years may not give you enough time to recover from a substantial market drop.

Though some of you have never experienced a sustained down market ( otherwise known as a "Bear Market"), let me assure you that they are not a thing of the past.

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Retirement Readiness Falls on Housing Market

By: Eric Gursky

Oct. 27 (Bloomberg) -- Fewer U.S. households are prepared for retirement after the value of their homes and investment portfolios declined in the recession, Nationwide Mutual Insurance Co. said.

Fifty-one percent of Americans would be unable to maintain their standard of living if they retired at age 65, compared with 44 percent in 2007, the insurer said today in a statement, citing the National Retirement Risk Index it developed with the Center for Retirement Research at Boston College. The estimate is “conservative” because it doesn’t include medical costs or long-term care, the insurer said.

“The real problem behind this is that so many households were dependant on their home values,” Paul Ballew, a senior vice president of customer insights and analytics at Nationwide, said in an interview. “Once home prices came back down to normal levels, we wake up one day and realize we don’t have adequate savings.”

Americans are facing a decline in the value of their homes and other assets at the same time the U.S. government is pushing back the age that retirees qualify for full Social Security benefits. The average 401(k) retirement savings account fell by almost one-third in 2008, and people aren’t saving enough to make up the difference, Ballew said.

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Is Working Through Retirement the New Trend?

By: Eric Gursky
When people think of retirement they imagine the days playing golf and sipping on an umbrella drink somewhere warm. That society norm was 10 years ago, now that our economy has rapidly changed and people's 401k futures are less secure we are seeing an increasing number of 65+ workers still playing a major role in the workforce. In fact, Marc Freedman, author of Prime Time, describes how the baby boomers will transform how society views retirement -- bringing about a new image of aging, retirement, and the role of older Americans in our society. He cites statistics that show that in just a few years the number of folks over age 50 will surpass a quarter of the U.S. population. And the U.S. Bureau of Labor Statistics reports that baby boomers are reaching the age of 60 at the rate of one every seven seconds. Many of these folks will be searching for something beyond a leisurely retirement. Whether you work after age 65 will depend on many factors -- whether you have a defined-benefit plan or retiree health insurance, whether you are in good health, whether you can find work. But make no mistake about it: Some of you will work past age 65 and earned income will play a significant role in your finances. Of course, this new reality is often a function of need, particularly with the recent downturn, Freedman said. "But social norms are fast changing," he said. "Many folks simply want to continue to go to work to engage with other people. It makes them happier and gives them a greater sense of purpose." After all, earning a paycheck in your latter years can make a huge difference in retirement living standards. Pocketing even a slim income often allows retirement portfolios to compound over a longer period of time.

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Best Countries for Retirement

By: Eric Gursky
If you could move to any country of your choice to retire with the most secure pension benefits, which would you pick? By and large, experts who study pension systems say no country is a retirement Shangri-La, though certainly some places do better than others in providing for retirees' financial security.

"I am having a hard time dredging up a country where things are copacetic," said Olivia S. Mitchell, a professor and director of the Boettner Center for Pensions and Retirement Research at The Wharton School. "Everyone pretty much has been hit by the global financial crisis and virtually everyone is confronting the aging revolution."

Others agreed. "We always regard this as a dreaded question: Which country has the best pension system?" said Edward Whitehouse of the Organization for Economic Cooperation and Development (OECD), which this summer published a definitive examination of pensions in 30 developed countries.

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Singers Never Retire

Posted By Shawn Gao

Many people plan to make their retirement in their golden year; however; some of people may not want to retire. These people are singers who are enjoying making their music. Even though these people are making millions of money for one year, they don't even think how they will do after they retire. The most famous rap singer- Jay- Z announced that he would never retire. Also, some of singers, like Tom Jones, said no to retirement. Why are singers so different from residents? Why don't they want to have early retirement?
Singers like Tom Jones who are nearly 70 years old, are enjoying their musical journeys, and have no plans to make. Tom Jones said that the older he gets, he enjoys what he has done and what's happened through his career. Most of singers have the same ideas as Tom Jones has. When they get elder and elder, they want to keep making more music as they could. Also, they do not want to make their fans sad.
Some singers, like country singer Garth Brooks, has announced he is ending his semi- retirement and signed up for an extended run of dates in Las Vegas. Many singers retire in their middle career, and return to the platforms later on.
For those fans, they are lucky enough to follow their never ever retired singers.
Reference
1.http://news.bbc.co.uk/2/hi/entertainment/8311133.stm
2.http://www.entertainmentandshowbiz.com/tom-jones-tom-jones-says-no-to-retirement-2009101220593
3.http://www.entertainmentandshowbiz.com/jay-z-jay-z-will-never-announce-retirement-2009092019313

Work Keeps You Healthy In Retirement

Posted by Shawn Gao

A new study informs it is better to continue to work after retiring, as it helps in having fewer diseases and fewer functional limitations than those who quit work completely.

The study published in the October issue of the Journal of Occupational Health Psychology shows, a part-time job or self-employment or ‘bridge employment’ is generally good for health after retiring officially.
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When Early Retirement Is The Only Option

By Quang Nguyen



Many people have their life plan mapped out since they are in their 20s. People like artist Richard Freund knew that he would work until he was 70 years old while his wife, a psychotherapist planned to work until she turned 62. They planned how their retirement was going to be with all of their investments and work benefits. And then came the recession. People just simply can't find work. For the more educated and wealthier group of people, things might come easy as they have the resources to work out a deal somehow, but for the majority of the labor market, things do not look too well. For many of them, retirement is the only option. It is a terrible situation to be in, but there is nothing they can do about it.

People are feeling scared. This is the first time since the great depression that put people into this situation. Some might try to find another job and get back to work. Most economists would suggest people to try to find another job to get that extra income that they don't have. Some are thinking of getting their social security benefits. However, they must work at least 10 years in order to qualify for the benefits. One good thing about the social security system is that they adjust the money amount into today dollar. For example, if you earn $5,000 in 1967, it will be $39,000 today.

The government is also doing its best to improve the situation. In October, President Obama called for Congress to approve $250 payment to as much as 50 millions seniors to make up for the fact that Social Security will not increase next year. The White House estimated that the cost to this plan will be $13 billion. Although $250 might not be that much, it would really help those who are in trouble. Although the result of this program is not yet to know, it sure would calm people down and support them through this difficult time.

Sources:

http://www.msnbc.msn.com/id/33231989/ns/business-personal_finance/

http://money.cnn.com/2009/10/13/pf/expert/retired_early.moneymag/index.htm?postversion=2009101310

http://www.msnbc.msn.com/id/33316549/ns/business-personal_finance/

Is the Recession Helping Us Live Longer?

posted by Jameel Murray

Last week I posted an article discussing the effects of the recession, which are forcing citizens to work through retirement. Because employees do not have the proper savings to retire due to the recession, many are forced to work past the retirement age minimum. Even though it may sound a bit difficult, it may actually be a great thing for most. Recent studies have shown that those who work temporary or part time jobs after the retirement age are physically and mentally healthier than those that are fully retired. Researchers interviewed an estimated amount of 12,200 people every two years over a six-year period. This may not seem surprising for most but can we actually give credit to a grueling recession for keeping our citizens healthy?
Retirees who continue to work past the retirement age function better daily and suffer 17 percent fewer diseases than those who actually retire. Studies have also discovered that those who do tend to fully retire often die sooner. According to Professor Cary Cooper, an occupational psychologists at the University of Lancaster, if one’s mental wellbeing is depleted it will affect you physically. In conclusion, the recession has condensed our wealth, however it has proven to complement our health.

Sources: http://www.themedguru.com/20091014/newsfeature/employment-post-retirement-leads-better-health-study-86129713.html

http://www.stuff.co.nz/life-style/2969037/Retirement-is-not-the-healthy-option

http://www.nepalnews.net/story/554409

Retirement: When time IS an issue

By Jonathan Tse



It is very important to start saving up for retirement early on in one's life because unexpected things can happen later on, so one must be prepared to have enough money to last until long after retirement. For those who started later, there are still ways to live comfortably and not have to save massive amounts of money in the last few years of work.
In this type of situation, one must continue to invest no matter what the amount. Also, the investment should contain a good mix of something like 50% stocks, 40% bonds and 10% cash. One should not only rely on stocks because it is very risky to only rely on stocks, so bonds should also take up a big part of one's portfolio. Even though stocks are not earning as much as they did, having a diverse portfolio of stocks and holding them for a longer time will still give one decent profits in any type of economic situation. Holding too much of only one company's stock would be risky no matter how well a company is doing because of the uncertainties of business, so diversification helps reduce these risks. Some other things that can be done is to max out one's 401(k) and to take advantage of the $5000 provision for people over the age of 50. Try to find more ways to get the most out of investments and savings by finding and switching over to ones with the most interest rates and lower fees.
It pays to start early and save as much as one can when one has the ability to earn more.

http://money.cnn.com/2008/07/08/pf/retirement/boomer_july.moneymag/index.htm?postversion=2008071510
http://money.cnn.com/2008/09/05/retirement/retirement_perfectplan_60s.moneymag/index.htm?postversion=2008090912
http://money.cnn.com/2008/08/15/pf/millionaires.moneymag/

The right way to unretire

Posted by Quang Nguyen



Tom Wogan loves working with his hands, especially building fishing rods and restoring World War II Army knives. So when he retired in June 2006 at age 60 from his $110,000-a-year job as a shift manager at the Florida City nuclear power plant near his home in Palmetto Bay, Fla., he looked forward to spending carefree days puttering around his garage working on his hobbies. With a retirement portfolio worth $1.1 million, Wogan thought he was all set.

Then the bottom fell out of the stock market. Wogan's cool million plummeted 36% in a matter of months; since then, as he's tapped savings to meet living expenses, his portfolio has dropped further and is now worth just $630,000. That's hardly enough to last Wogan and his wife, Pamela, 55, into ripe old age -- especially since her job as a graphic designer pays only $32,000 a year and the Wogans still pay a mortgage and aren't done with college tuition for three of their four children yet.

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Millionaires in the making: The Rodrigueses

posted by Jonathan Tse

Only 27 years old, prodigious savers Gina and John Rodrigues are determined to retire with a million-dollar nest egg by the time they turn 40. Here's the odd part: They just might make it.



(Money Magazine) -- John and Gina Rodrigues have always been good with numbers. John is a software engineer who manages a team at Microsoft, and Gina spent years processing mortgages at Wells Fargo and Countrywide Home Loans. But the numbers they are especially good at are the kind with dollar signs in front of them.

At age 27, John and Gina already earn a combined $174,000 a year, save half of what they make and have built a formidable portfolio of $380,000 in stocks, mutual funds and cash. Their goal: to become millionaires and retire by the time they turn 40, just 13 years from now.

To make that dream a reality, they have become black-belt practitioners of an art rarely practiced in America these days: While others with their earning power might indulge in fancy dinners, luxury vacations and designer wardrobes, the Rodrigueses live like young couples did before the era of easy credit. They rent the house where John grew up in the San Francisco Bay Area for a mere $650 a month; rarely travel; split an entrée on the rare occasions they eat out; and spend almost nothing on clothes (John wears free Microsoft T-shirts, while Gina gets hand-me-downs from her sister).

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Gulf Between Rich And Poor Seniors Could Widen

by Ashlea Ebeling
posted by Jameel Murray

The current downturn will likely sharpen the financial gulf between the most affluent, best-educated retirees and the poorest ones. That, at least, is the conclusion suggested by new data from the Social Security Administration and a new study by Phillip Levine, chair of the Department of Economics at Wellesley College.

For all their bellyaching about declines in the value of their 401(k)s, the best-educated older workers, whose skills are most in demand, usually have a way to make up for their losses: work longer. The less educated, particularly during a recession, often do not have that luxury and end up forced into an early retirement.

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During Retirement, You Can’t Afford to Coast

Posted by Alma Zhumagulova
By PAUL B. BROWN
Published: October 10, 2009


FOR those of us who, thanks to the market’s recent climb, are now feeling slightly better when we look at our retirement accounts, Daniel R. Solin offers this splash of cold water in the face:
Skip to next paragraph

“How you invest during retirement is as critical as how you invest in preparing for retirement.”

And he contends in “The Smartest Retirement Book You’ll Ever Read” (Perigee, $21.95) that we are not prepared for that second phase of our investing lives.

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How to have you dream retirement come true!

By Alma Zhumagulova


In this current situation almost everyone is worse-off: recent graduates, who can’t find job, middle-aged people being laid-off, even the older generation that cannot leave their jobs and retire as planned.
In order to learn from the older generation’s mistakes, you should start saving for retirement as early as you can and save regularly. The dollar that you did not save in your 20s becomes $8 you have to save if you start saving in 50s. When you are just starting to acquire the basic fixed assets such as home, car, or are paying of student loans, it is fine to save only 3% of income, but as time goes on you should progressively increase the share of income you are putting aside to about 10-12% which is the optimal desirable amount.
If, however, you procrastinate saving early, it is not too late to start saving 15 years before your retirement. At this moment you should establish a financial plan for saving and retiring, gradually get rid of any debts, and try to pay off your mortgage. According to CNNMoney, one should aim for 80% of their income before taxes for heir retirement income to maintain the same level of life. Everyone is unique and everyone has their own “dream” retirement vision, so adjust your savings not only according to your income but also to your desired lifestyle after retirement. Always have a cushion, i.e. save more than average for your income level, just to be on the safe side.
When you are very close to your retirement, try to use up your benefits provided by your employer and take the vacation days you haven’t taken either as cash or a nice break. Decide on how you will withdraw your savings, sign up for Social Security and Medicare and then start enjoying your retirement.

References:
http://www.chicagotribune.com/business/yourmoney/chi-tc-biz-ym-started-1004oct04,0,7403517.story

http://www.hometownannapolis.com/news/bus/2009/10/04-29/Ways-to-prepare-early-for-your-retirement.html

http://money.cnn.com/2009/10/08/pf/expert/retirement_incom.moneymag/index.htm?postversion=2009100810

It is not late to start your retirement planning

posted by Shawn Gao

When people are fifty or more years old, they are wondering whether they start their retirement saving too late.
One recent research by HSBC shows that only 13 percent of people around the world have already prepared for their retirement saving, and another 43 percent of people have undertaken some planning without clear mind of how much income they have from the plans.
Depending on the current situations, elder people have to deposit more than teenagers and adults. Since elder people have already passed their golden years of working, they need to consider more about their saving plans.
However, during the downturn economy years, financial advisors offer some special retirement plans for those elder people who didn't start their retirement savings early. It is fair that elder people need to expand their working years with enough saving s for another 15 years. Financial advisors suggest that elder people could be in self- employment or part- time in order to increase their income and expand working years. To build enough wealth to support their rest of lives need to set more time and meaningful amount of money.
reference:
1.http://gulfnews.com/business/your-money/retirement-planning-for-late-starters-1.512484
2.http://www.onlinenews.com.pk/details.php?id=153295
3.http://www.kaiserhealthnews.org/Columns/2009/October/101209Gleckman.aspx

Retirement planning for late starters

Posted by Shawn Gao

If you're in your 50s and haven't set aside money for your retirement, you may have a big problem.
If you're in your 50s and haven't set aside money for your retirement, you may have a big problem. But you're not alone. Across all age groups, only a few people have actually prepared for their golden years.
According to a study by HSBC, just about 13 per cent of people around the world feel they are very well prepared to cope with their retirement. Although 43 per cent have undertaken some planning, they lack a clear sense of what their retirement income will be like.
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Retire in Style

By Quang Nguyen



During this economics downturn, many people are struggling just to live by. It's easy to read on the news that many people are considering working after retirement. However, there are a number of people are living it up and enjoying the best that retirement brings. These people are the one who save through their working years after years. It is estimated that in order to have a good time during retirement, you should save as much as 80% of your salary. And that is just for people who make under $100,000 a year. For others, who made around $250,000, they save as much as 88% of their salary toward retirement. The advice is that give yourself some cushion for the golden ages.

The average age for retirement is 65. However, many executives, professionals, and business owners retire at 60 or earlier. Some people who work for large organizations even get a better deal to retire in their mid-50s when the companies are looking for ways to downsizing. When you retire at age 65, the only benefit you get is the full benefit from Social Security, which is around $1,200 a month. For people who have saved and invested for their retirement, this money is sure nothing compare to many years in their early retirement.

So what options do you have when you get into the old people's world with money in your pocket? Well there is the continuing-care retirement community that you can check in. This amazing place offers gourmet restaurants, infinity pools, gyms, spas and concierges. Some even have cinema and putting green. The greatest luxury of it is health care for life. There are currently 1,800 continuing-care retirement community in the country, and right now is the best time to get into one. For the past couple years, applicants have to be on a long waiting list and some never actually get in. What is the cost you might ask. Well there is an up-front cost that ranges from $20,000 to $1 million, and it averages out to be $250,000. And this is just for getting in. Once you in, there's a monthly cost of around $2,750. You can also pay around $7,000 to $8,000 a month for the skilled nursing care. So assuming a person is going to live 15 years at the community, and spends around $2,000 for the monthly fee, it will be $360,000 plus the entrance fee. How can people afford this you might ask. Most sell their house for the entrance fee, and their saving for retirement works perfectly fine with the monthly fee.

Sources:

http://money.cnn.com/2009/10/08/pf/expert/retirement_incom.moneymag/index.htm

http://findarticles.com/p/articles/mi_m1365/is_n3_v26/ai_17464077/?tag=content;col1

http://money.cnn.com/2009/02/12/retirement/Gengler_living_up_retirement.moneymag/index.htm?postversion=2009021304

Recent findings show that many Americans are planning to work past retirement

By Jameel Murray

When it comes to financial planning, retirement can be a scary thing to think about for most people. Given that most citizens are not familiar with their own retirement planning, retirement is becoming a problem for many employees. According to a recent study conducted by Bankrate, more Americans are planning to work past retirement. While 39 percent of citizens are planning to work past retirement because they simply enjoy working, 55 percent of retirees worry that they have not saved enough and would be required to work in order to have a substantial living situation. Because of the recent economic turmoil, 40 percent of Americans are planning to postpone their retirement. Other percentages display that 40 percent of Americans are solely investing for retirement while 27 percent receive aid from a financial adviser.
Even though the financial crisis has altered the retirement plans of many Americans, studies have also discovered that the majority of workers worried about their retirement plans are those with a high school education or less. These recent findings have outnumbered historical statistics and therefore provide us an example of the importance of financial planning. It is required that employees get some source of aid or advisory when making their retirement planning decisions.

Source: http://www.prnewswire.com/news-releases/75-of-americans-plan-on-working-as-long-as-they-can-63589602.html

http://www.google.com/hostednews/ap/article/ALeqM5jnz6k_0akwWFZa3GkQ7tmoZP3RwAD9B5Q5V82

http://philadelphia.bizjournals.com/philadelphia/stories/2009/10/05/daily28.html

Roth IRA, the savior of retirement funds?

by Jonathan Tse


Traditionally, the Roth IRA accounts were only open to people with incomes of less than $100,000. But beginning January 1, 2010, people with incomes greater than $100,000 can transfer their assets to Roth accounts. Unlike most other IRAs, the money grows tax free and there is no tax on withdrawals after the age of 59.5. The only problem is that no one knows about these benefits of the Roth, so there are very few people who would know to take advantage of this. Many employers are now trying to promote this to improve on their own offered retirement packages. Normally, in the IRA system, money placed in its account will grow tax free, but withdrawals made will be taxable.

For younger people who want to start saving up for retirement, Ross is very useful when used in conjunction with a pre-tax 401(k)plan so that they will have access to both a taxable and tax-free source of retirement funds. For younger people, since they are usually starting off in low income bracket, Ross benefits them greatly.

Many people are contemplating transferring the money in their 401(k)s directly to Ross accounts, but professionals warn that there are dangers to this. A danger is that the transfer may lead to IRA accounts being dropped. One would receive a tax bill with more value at the time of conversion, but may also later end up with an account that is worth significantly less. Although there are dangers to doing this, the benefits would mostly outweigh the dangers.

http://www.smartmoney.com/personal-finance/retirement/which-ira-is-best-7968/
http://www.thestreet.com/story/10608381/1/confusion-about-roth-iras-abounds.html?cm_ven=GOOGLEN
http://www.detnews.com/article/20091005/BIZ01/910050304/1010/Time-to-move-the-nest-egg

Now's the time to apply online for retirement

by Chuck Stovall
posted by Jameel Murray

If you’re planning on retiring sometime early in the new year, now is the time to apply for retirement benefits. The most convenient way to apply for Social Security benefits is online—from the comfort of your home or office. Just go to www.socialsecurity.gov/applyonline.

Our website will walk you through the online retirement application process. We will tell you what information you will need to answer the questions on the application. Further, we will describe the documents you might need to present once you have submitted your application.

Before you start your application, we recommend you get an estimate of your retirement benefit. This too, you can do on the Social Security website at www.socialsecurity.gov/estimator. The Retirement Estimator uses your personal employment history to estimate your retirement benefit. It also will help you to answer some of the questions on the retirement application.

You can use the online application to apply for Social Security retirement or spouses benefits if you:

Are at least 61 years and nine months old;
Want to start your benefits in the next four months; and
Live in the United States.
You will want to be fully informed of your options and their consequences before applying. The website will tell you everything you need to know about the Social Security “basics” so you’ll be ready to retire when you apply online.

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When the golden years include a commute

Posted by Quang Nguyen



At an age when many people start envisioning retirement, John Hanna was thinking about how he could keep on working.

“I didn’t want to retire,” he recalls.

Hanna, who is now 83, held on to his full-time job as an insurance broker until finally retiring at age 72. But without work, the Lititz, Pa., resident soon found that he was bored and restless.

nd so, about a year later, Hanna went back to work as a notary for a car auction company. He continues to work two days a week and has no intention of giving it up.

“I see what happens to guys that retire and just sit around,” Hanna said. “You know, we turn to mush.”

A combination of good health, economic necessity and the other rewards of work are pushing some Americans to stay in the work force long past traditional retirement age. About 7 percent of people age 75 or older were in the labor force as of June, up from about 5 percent a decade ago, according to the Bureau of Labor Statistics. That translates to more than 1.1 million people working past age 74, up from 750,000 a decade ago.

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Time to move the nest egg?

Changes in Roth IRA rules next year could benefit your retirement fund
Brian J. O'Connor / Detroit News Finance Editor
Posted by Jonathan Tse



Having money means having choices, and soon the two or three people left in the U.S. with any kind of sizeable income will have to make one: whether to convert their IRAs.
Starting in 2010, high-income savers can convert their regular Individual Retirement Accounts to Roth IRAs. This allows them to pay taxes on the accounts now and forever escape taxes on future investment gains.
The timing couldn't be better for anyone who's seen their IRA balance drop in the market meltdown, since many personal finance experts expect tax rates to go up in the next few years. Converting a regular IRA to a Roth now allows savers to trim their tax bills two ways: They pay taxes on their temporarily lower balances now and do it at the current lower tax rates, instead of paying higher tax rates on bigger balances later, when their accounts have (we hope) regained their losses.

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Tips for young investors who hope to retire some day

By Alma Zhumagulova

If you've ever calculated how much you'll need for retirement, you know the number can be big.

So it's no surprise that with stocks still down some 30 percent from their peak in 2007, few people are confident about their savings.

Even Social Security is feeling the strain: With more people out of work, the program is on track to pay out more in benefits than it collects in 2010 and 2011, according to reports last week.

What's a young investor to do?

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Employees are getting early retirement

Posted by Shawn Gao

Since GE went bankruptcy, there have been many blue collars brought their package back to their home. Things did not just happen recently. The previous, many blue collars went to street and strike on the bankruptcy of GE.
Till now, things didn't go so well. Still, many companies were announcing cut down employees in order to help themselves getting out the recession. It is true that cutting numbers of employees will reduce cost of one company; however; how about the people who just got their” early retirements”? Actually, people are still respecting what US government could make. After many polices came out, the way of living during the recession was not better. Even if some developed counties announced the economy is getting better. Many people didn't find the way to get their jobs again. So far, job markets doesn't seem as it pass the recession time. Not only those blue collars, but also the graduated students will get their early retirements. What else will the governments do for future years? The question has many answers, but people need their jobs back. It is the way to figure out their debts.
reference:
1.http://www.goerie.com/apps/pbcs.dll/article?AID=/20091004/NEWS02/310049940
2.http://online.wsj.com/article/BT-CO-20091002-701224.html
3.http://www.google.com/hostednews/ap/article/ALeqM5h6BfoloJOnV0TeI7eIHC1ZWuBxygD9AVS0202

Ways to prepare early for your retirement

posted by Shawn Gao

You can buy a "Retirement Countdown Clock" online for about $30. You program the kitschy timepiece to count down the number of days, minutes and seconds until your desired retirement date.
It's cute, but to be truly useful it needs an additional feature: an alarm that goes off periodically to signal you that it's time to take care of pre-retirement business.
Until someone invents a clock that helps you with your actual planning, you can use Consumer Reports Money Adviser's timetable to keep your retirement plans on track.

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Social Security During This Big Wave of Retirement

By Quang Nguyen



The current economic downturn has forced many Americans to lose their jobs. With big job losses and early retirement from laid-off seniors making it difficult for the Social Security to pay out benefits. It is expected that for the next two years, the Social Security will have to pay out more benefits than it collects in taxes. The deficits will be $10 Billions in 2010 and $9 Billions in 2011. Even though it will not affect the payments to retirees since the surpluses of Social Security is $2.5 Trillions from previous years, it will add to the overall federal deficit. According to the Social Security, the application for retirement benefits are as much as 23% higher than last year, and claims for disability also increased to 20% higher.

Furthermore, the high number of baby-boomers getting to their retirement plus the number of other unemployed people chosen to retire early have added up to a 19% jump in 2009. There are approximately 2.6 million people entering to the Social Security benefits this year in comparison to 2.2 people in 2008. Just during last August, the government has paid out $6 Billion in benefits more than it took in taxes.

Social Security officers commented that they have already had prediction on the high number of retirees due to the great number of baby-boomers, however they did not think it would be this high. The people who retire early have to cut out a big portion of their benefits. Many of whom do not have a choice since they lose their jobs and could not afford to raise a family. Some people tried to find another job but the current economy does not guarantee it.

Sources:

http://finance.yahoo.com/news/Job-losses-early-retirements-apf-161066651.html?x=0&.v=6

http://www.usatoday.com/news/nation/2009-10-01-social-security_N.htm?csp=34

http://www.msnbc.msn.com/id/33043206/ns/business-us_business/

http://www.washingtontimes.com/news/2009/sep/28/job-losses-hurt-social-security/

Recession Gets in Way of Retirement Planning

by Jameel Murray

The recent economic downturn has affected our living. Because of the recent recession, Americans are seemingly more responsible with their money. Since the recession, people’s savings have drastically increased, fearing the idea that the recession is not going to end anytime soon. Even though people are starting to save more, the investment in retirement has been somewhat stalled. According to the 2009 Benefits and Talents survey, 87% of respondents have stated that they are delaying retirement plans, due to the economic conditions. Employers have also taken the same attitude toward their retirement planning programs, but due to the high cost of company required contributions, companies are not changing their pension, benefit programs anytime soon.
Although stalling retirement planning may seem like a bad thing for employees, studies have shown that most of these employees have little or no knowledge of the amount of money needed to retire. Many believe that retirement would eventually become a challenge for many Americans in the future because very few employees know how much to save for retirement.

http://sev.prnewswire.com/banking-financial-services/20090930/CG8410530092009-1.htmlhttp://www.news-insurances.com/recession-makes-employees-worry-about-their-retirement/01675307http://charlotte.bizjournals.com/charlotte/stories/2009/09/28/daily40.html

Baby boomers in their retirement

By Alma Zhumagulova

Currently there are around 77 million baby boomers that are at or near their retirement age. The 401(k) retirement plan along with the two financial crises in the 2000s is going to turn their retirement planning into a nightmare. Thousands of savers lost huge parts of their savings in the burst of the dot-com bubble in 2000 and the current recession. According to Associated Press about 20% of their retirement savings were lost in the crisis, and even though they were restored to some extent, they were still 2.6% lower than in the previous year. Additionally, many of the baby boomers have not been saving enough throughout their careers. This is causing the baby boomers to continually postpone their retirement and to give up on their “dream” retirement: travelling, buying a second home etc. In order to maintain the lifestyle they were used to after they stop working many elderly people are forced to work longer than they expected. In 2008 around 25% of Americans in the age bracket of 65 to 74 were employed, and at this moment, around 9% of Americans between the ages 75 to 84 are still working.

Around 66 million workers in the US are currently covered by a 401(k) retirement plan which was not even initially designed as pension plan but instead as “a tax shelter for end-of-the-year bonuses for bankers”. Many experts now argue that the 401(k) plan is very difficult to arrange even for professionals let alone the baby boomers that were used to the old defined-benefit pension plan. They don’t know how much they will need after retirement, how much to put aside, and what to invest in. In order to prevent these retirement problems for the future generations of Americans it is necessary to either alter the retirement planning system or to teach them how to save so as to have the dream retirement they deserve.

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Job losses, early retirements hurt Social Security

by Steven Olemacher
posted by Jameel Murray

WASHINGTON — Big job losses and a spike in early retirement claims from laid-off seniors will force Social Security to pay out more in benefits than it collects in taxes the next two years, the first time that's happened since the 1980s.
The deficits — $10 billion in 2010 and $9 billion in 2011 — won't affect payments to retirees because Social Security has accumulated surpluses from previous years totaling $2.5 trillion. But they will add to the overall federal deficit.
Applications for retirement benefits are 23 percent higher than last year, while disability claims have risen by about 20 percent. Social Security officials had expected applications to increase from the growing number of baby boomers reaching retirement, but they didn't expect the increase to be so large.
What happened? The recession hit and many older workers suddenly found themselves laid off with no place to turn but Social Security.

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Workers discover 401(k) plans are failing them in retirement

By Brian J. O'Connor / Detroit News Finance Editor
Posted by Alma Zhumagulova


If you're one of the more than 66 million workers covered by a 401(k) retirement plan, Nancy Hwa has some news for you.

"It was a tax shelter for end-of-the-year bonuses for bankers," says Hwa, spokeswoman for Retirement USA, a group working to improve retirement plans. "The 401(k) was never even intended to be a retirement plan."

And now, many workers are discovering, it isn't.

By the end of last year, the average 401(k) balance dropped to $57,200, down 28 percent from $79,600 in 2007, according to consulting firm Hewitt Associates. Forty-four percent of workers lost at least 30 percent.

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The new ‘retirement’ plan: Just keep working

Posted by Quang Nguyen



When Kathy Corrigan, 64, was let go last September from her job with a trade association, she already had begun to think about retiring after a 25-year career as a meeting planner.

But when she sat down and looked over her savings, she realized the 30 percent hit she took from the market meltdown meant her shrunken nest egg wouldn’t go far enough.

“The numbers just were not crunching right,” she said. “I don’t think I ever intended to fully retire. But it’s definitely not an option now — at least not for the immediate future. I’m still hoping that it will be no more than 5 years, but you have to continually reassess.”

Even before the collapse of the housing and financial markets last year, Americans were woefully unprepared to pay retirement in the traditional sense of a post-career period of leisure and personal pursuits supported by a pension, well-managed nest egg and Social Security.

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The old people are coming back!

by Jonathan Tse



The current economic situation of America is leading to many different changes. Probably one of the most drastic is the retirement plans of the elderly. No longer are people past the age of retirement staying at home relaxing and going on vacations all over the world. In fact, the new retirement plan for the elderly is to stay in the workforce.
The recession has made it so that the elderly cannot support themselves after retirement, so they are left with only two choices: to reduce their standards of living and spend less or to re-enter the workforce. Many more senior citizens are choosing to continue working and delay retirement either because of the fact that they are not able to reduce their spending by much, or because it is humiliating to admit a loss of wealth in front of family and friends. The current generation of senior citizens were expected to be growing and among the richest. Due to the recession, they are not pouring nearly as much into the economy as predicted earlier.
Many elderly people are re-entering the workforce in fields that they did not previously work in. In order to gain more of an advantage, more elderly people are also re-educating themselves by attending community colleges and attaining quick degrees so that they may quickly start working again. With the increasingly competitive working environment, and also stereotypical beliefs about older people, it is becoming much more difficult for the elderly to find and maintain long-term occupations.

http://www.msnbc.msn.com/id/32087898/ns/business-personal_finance/page/2/

http://hr.blr.com/news.aspx?id=4276

http://www.nytimes.com/2009/04/02/business/retirementspecial/02reskill.html?pagewanted=3&_r=1&ref=retirementspecial

As work force grays, employers lag behind

posted by Jonathan Tse

Older workers need flexibility, training, but often fail to get it



By Eve Tahmincioglu
msnbc.com contributor
updated 9:56 a.m. ET, Thurs., July 30, 2009


Eve Tahmincioglu
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Anne Staats was 75 when she took a year off work to care for her ailing husband.

After her husband passed away, she was ready to go back to her job as a receptionist for a home care and medical staffing company but didn't want to work full time. Fortunately for her the company, Interim HealthCare in Sunrise, Fla., had a program in place to hire older workers and allowed her to return to work three days a week with full benefits, including vacation and sick time.

“I was lucky to be working for Interim,” says Staats, now 85. “Other companies would look at you and say, ‘You’re too old.’”

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How Retirement Planning Has Changed

By Jorden Meltz

After the events of last year, many soon to be retirees were left asking how will I still be able to retire at the age that I previously planned on retiring at? The realization for some is that they won't and instead face several more years of working ahead of them. Since 1992 there has been a dramatic drop in company pensions, 40% to 17%, and a rise in 401k Plans, 32% to 80%. The reason why the change in the two has affected so many is that 401k Plans depend upon how successfully the employee has invested their money and unfortunately even prior investing success did not prevent many from losing large percentages of their retirement funds. It is estimated 401k Plans lost 40% as the country entered into a recession over the past year. With a much greater emphasis now on 401k Plans people will be forced to take a more active role in their investments and it is now recommended people look to bond indexes and stocks that pay dividends for better performing investments. The events of the past year has lead most people looking to retire towards reevaluating their plans and investments and has hopefully left many of those people more knowledgeable and prepared to deal with the market then before.

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Health Care Costs and Retirement

by Leah Gorham

Proper planning for retirement is not only important for retirees to maintain the lifestyle they had before retirement, but may also be crucial for paying for the high cost of health care. Retirement health care costs are rising due to factors such as the increased use of technology and prescription drugs and at the same time, personal savings are decreasing and the Social Security system will likely fail to provide adequate support in the future.

In 2008 an analysis by the Employee Benefit Research Institute said that a couple currently at the age of 65 would need $635,000 to cover healthcare costs in retirement, not including long-term care costs. This estimate gives the retired couple a 90 percent chance of having enough money to cover all health bills beyond what Medicare covers as opposed to lower estimates.

Options for paying for health care and long-term care include Medicaid buying long-term care insurance, selling the family home when long-term care is needed, or tapping into the value of the home through a reverse mortgage. Many poor seniors will rely on Medicaid, while those with a higher income may prefer to buy insurance, which can cost about $3,500 a year if acquired at age 65. According to the American Council of Life Insurers approximately 48% of long-term care recipients and their families pay long-term care costs out of their own pockets, 41% qualify for Medicaid, 8% are getting temporary coverage provided by Medicare. and only 3% are paying with private long-term care insurance.

It is important to think about the options for long-term health care before the need is dire and prepare adequately for retirement health care costs early.

Source 1, Source 2, Source 3

The "Working Retirement" Conundrum

By Mary Clare McGraw

An increasing number of retirees are taking up a second job, even a second career, often totally unrelated to their pre-retirement career, with the underlying motivation of paying the bills. For a variety of reasons, surveys have shown that the majority of aging baby boomers are planning on working in retirement. That second job can be a great way for a retired individual to take up what was perhaps just an enjoyable hobby earlier in life and turn it into a source of income that acts as a security net in this unsure recession. Although it may be a necessity in order to maintain an income during a longer life expectancy, that second job owning a restaurant or a floral shop can be a pure joy and a way to stay occupied almost.
As enjoyable as a hobby-turned job can be, it is dangerous to depend on the possibility of that supplemental income later in life because there are a number of things that can happen to prevent an individual from being able to work. Studies have shown that one in four Americans won’t be able to work in retirement for one reason or another, whether it is a health problem, accident, or any unforeseen event. Working in retirement can be a blessing or a curse, but regardless of whether or not an individual plans to work in retirement, it is essential to save and invest years in advance.

Source 1, Source 2, Source 3

7 Ways to Mess up Your 401K

posted by Leah Gorham

By Liz Pulliam Weston

Not contributing at all is the biggest mistake people make, but there are others that can cost you substantially as well.

In many ways, the 401(k) picture looks bright.

Most folks who have access to a 401(k) take advantage of their workplace retirement plans. Average balances are up over the past few years. And workers seem to have finally gotten the message that company stock is not their best investment option.

But millions of workers are still blowing it every day when dealing with their retirement plans. Here are the seven biggest blunders you can make:

1. Not signing up
I've seen a few awful 401(k) plans in my time. One was run by a dentist who forced his employees to help him buy raw land. (That was their only investment option.) Another offered only high-cost, poorly performing variable annuities with surrender charges that lasted 16 years, meaning workers often had to forfeit a good chunk of their money if they left their jobs and wanted to roll over their accounts.

But such truly heinous plans are few. Most participants get a decent range of investment options (17 choices is typical), reasonable fees and a company match. About 98% of the large-company plans that Hewitt Associates surveyed contribute to employee plans, with two-thirds offering matches.

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How to make your money last

Posted by Nick Porcell

Once you have your Social Security strategy down, there's just one little retirement question left to consider: How can you make the money that you've so diligently saved provide the life you want for as long as you live? Oh. That.

Figuring out how to draw secure retirement income from a portfolio is a challenge in the best of times; today it's made more complicated by fear. Having seen the worst-case scenario unfold in the past year, you've probably gone into loss-avoidance mode. But deflecting market risk leaves you vulnerable to inflation risk -- and the risk that you'll outlive your money. So hiding in cash won't save you.

"No one investment can protect you from every risk you'll face," says John Ameriks, head of Vanguard Investment Counseling & Research. What you need, rather, is a basket of investments that provides:


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how Individual Retirement Acccounts (IRAs) help you save for retirement.

Posted by Mary Clare McGraw

A traditional IRA (individual retirement account) is a critical retirement planning opportunity. Tax-deferred growth and a potential tax deduction are among its most important features. Traditional IRA considerations include:
Why Open an IRA

A traditional IRA is particularly attractive to those who are not eligible for a workplace retirement plan (like a 401(k)) or whose earnings limit their ability to contribute to a Roth IRA. With opportunities for tax-deferred growth limited, a traditional IRA can be a great way to increase the likelihood that your retirement years are prosperous ones.


How and Where to Open an IRA

You can open an IRA at nearly any bank or brokerage house, either in-person or online. Opening an IRA is a very simple process, typically with help readily available. Often, there are just a few forms for you to complete. Bring your Social Security number with you as well as the Social Security numbers and addresses of any potential beneficiaries of your account.

Click here to learn more about IRAs

Putting the eggs back in the nest

Posted by Jorden Meltz

Like millions of Americans who have painfully watched their home's value collapse and their 401(k) crumble, the Lineberrys are being forced to make major lifestyle changes they never imagined.

It's natural when you lose money to want to make it back. Research shows that the pain of financial loss is much more acute than the satisfaction of a gain. Losses of course are particularly hard on retirees, who no longer have the time to recoup them and need regular income from a portfolio.

Do you really want to know the quickest ways to replace lost wealth? It's not by pouring money into stocks or other speculative investments. The answer is to follow a financial plan that brings down the cost of your lifestyle.

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Investing Safely for Retirement: If there Is Such a Thing

By Jorden Meltz

With many having lost large portions of their retirement savings last year, the question on most peoples minds is how do I make it back? To some the answer is to invest in riskier securities in hopes of making the money back sooner and to others the answer is to avoid risk and work longer. There is no wrong or right answer and instead it is truly a matter of opinion and personal comfort zone. Experts have spoken out about the issue though, and have made strong cases for both sides. Economist Zvi Bodie believes that stocks are always risky and contrary to common belief do not lose their risk over time. It is with this mindset that might lead some to believe investing in treasuries or high rated bonds is their best bet, even at the expense of working several years more. Another less risky approach some are advising their clients to take on is bringing their stock to bond ratio closer together: having a 54% to 46% split versus a more traditional 60% to 40%. With the market still in a state of uncertainty, bonds have continued to perform well, and thus some believe currently they are the better investment. Lastly, since many consider bonds safer investments, are high yield bonds the way to go?. Granted they bring higher returns, but they also have a higher chance of defaulting and thus become a risky investment. Year to date high yield bonds, also known as junk bonds, have been the top performer in the bond category and it will be interesting to see if that statement holds true for the rest of the year. With retirement on the minds of many, there are many questions all having a variety of answers. Although the answer may not be what they want to hear, with retirement approaching quickly for many, they are answers that must be taken into consideration.

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Retirement Savings Challenges for Women

by Leah Gorham

Studies have shown that women tend to lag behind men in saving for retirement. In a 2008 survey of over 1,300 workers or retirees over age 25 by nonpartisan Employee Benefit Research Institute (EBRI) and Matthew Greenwald & Associates it was found that 58% of women and 64% of men said they were contributing to a workplace retirement account. Also, while 70% of men said that they were "currently saving," only 59% of women said the same.

There are several factors that account for why women save less then men for retirement. First, the wage gap between men and women result in lower median pay for women, then resulting in a reduced ability to save for retirement. However, behavioral differences can also impact the gender gap in retirement savings. Many women make choices to provide care for their children and/or aging family members and in doing so may give up their careers or significantly decrease their earnings. Women are also more likely to work for non-profits and small firms that are less likely to offer employer-based retirement plans. Women need to consider these challenges seriously when thinking about saving for their retirement. Another factor to consider is that women generally live longer then men and therefore need to plan for a longer retirement.

There are several strategies that women can use in order to ensure a secure retirement and lessen the gender gap in retirement savings. These strategies include:
-Starting your own retirement account and putting your retirement savings first.
-Seek employment with retirement benefits.
-Always keep a portion of investments in stocks.
-Consider opening a spousal IRA.
-Check your Social Security record.
-Continue to play an active role in the financial planning process.

Source 1, Source 2, Source 3

What Social Security's Underfunding Means for Your Retirement

The baby boomers will get their payouts, but what about the rest of us?

Posted by Mary Clare McGraw

Social Security and Medicare's annual checkup revealed that the recession
and longer life expectancies are taxing the health of the entitlement system. The Social Security Board of Trustees report found that program costs will exceed tax revenues in 2016, a year sooner than predicted in last year's report. The trust fund will be exhausted in 2037, four years sooner than the 2008 estimate. Here's a look at how the projections could affect your retirement plans.

Smooth sailing for the baby boomers. In 2037, the year the trust fund is currently projected to be depleted, the youngest baby boomers, currently age 45, will be 73. It's highly unlikely that baby boomers will face a rise in the retirement age or cuts in benefits. "The good news for current beneficiaries and those nearing retirement is that your benefits will remain secure and intact for the foreseeable future," says Nancy LeaMond, executive vice president of AARP, a lobbying group for older Americans.

Changes for younger people. Social Security and Medicare will still be around for younger generations. But there is some uncertainty about whether there will be tax increases, benefit cuts, some combination of the two, or other fixes to correct the underfunding.

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Not much retirement security from government

Posted by Leah Gorham

Federal entitlement programs are critical to retirement security, but these programs are rapidly moving into the red. New projections by the trustees of the Social Security and Medicare trust funds released May 11 indicate that both funds will run out of money even sooner than estimated in last year's report.

The Social Security trust fund is in better shape than Medicare. Revenues still exceed benefits by a comfortable amount. Unfortunately, the wave of baby boomer retirements will change that picture. The new trustees report still expects the surplus to continue until 2015 but move into deficit thereafter. This report projects that by 2037, revenues will be only 75 percent of benefit payments.

An increase in average retirement age could help extend the period of surplus, but probably not by much. If workers delay retirement, they will continue to pay taxes into the system and not take money out, but when they do retire they will also get higher benefits. A net improvement in the trust fund results, but the change mostly delays the problem rather than reduces it.

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Posted by Nick Porcell

Tapping 401(k) retirement funds to meet expenses is a last resort for many investors, but the relentless economic downturn took its toll this year, as hardship withdrawals saw double-digit increases, according to record keepers.

Hardship withdrawals among the 2.8 million participants in 1,500 plans served by Bank of America Merrill Lynch increased 23 percent year to date through August 31 compared with the year-earlier period, said Kevin Crain, managing director of plan participant solutions at Bank of America Merrill Lynch, the institutional retirement, philanthropy and investments business unit at Bank of America.

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Retirement: Goal-Based Investing Gains Traction

Posted by Jorden Meltz


As defined benefit plans fade into history, more American workers are confronting the fact that they will need to be much more active in deciding how to marshal their retirement savings than their parents had to be. But how best to line up what you have now with what you'll need later?

That's where goal-based investing, or what some people call liability-driven investing, comes in. This increasingly popular approach is yet another example of the retail investing world borrowing a page from institutional investors' playbook—trying to manage people's assets so they better match their liabilities, which has long been a focus of pension funds.

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Points to Remember When Saving For Retirement

By Mary Clare McGraw

Saving and planning for retirement is no walk in the park, although one may think putting money aside is enough, it is essential to adequately plan for risks and road blocks that may occur along the way. It is crucial to take into account the possibility that inflation will deplete the value of your income in the future, as well as the troubling effects of outliving your assets. Experts estimate that in order to maintain the same standard of living after retirement as before, you would have to maintain at least 70% of your preretirement income, which is very generous and not always possible to obtain.
The possibility of outliving your assets is strengthened by the fact that health care costs are rising and simply the fact that people are living longer postretirement lives. A longer life is often accompanied by increased medical expenses, so the two go hand in hand, draining a retiree’s assets completely.
A major goal in retirement planning should be to not only put aside money and assets for your retirement years, but to ideally create a sustainable, predictable stream of income that even has the potential to increase over time. A way to maintain a steady income could be to hold a part-time job doing something you enjoy and may not have had the opportunity to pursue earlier in life when you had a career. It is never too early to plan for retirement and there are limitless ways in which you can save, with proper planning, retirement should be a relaxing, stress-free time in your life, and well-deserved of course!

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The Retirement Dilemma: Keep Working?

Posted by Mary Clare McGraw

As the first cohort of the baby boom generation this year hits 63—which is the average age of retirement in the U.S.—the big question is: Are they financially ready to retire? That question is only going to gain urgency in the next several years as more and more boomers jump into the pool of retired Americans. Unfortunately, statistics suggest that retirement isn't going to be nearly as comfortable as most boomers had hoped.

Declining wealth, brought about by lower stock prices and falling home values, has hurt older households substantially. Americans lost 18% of their net worth last year, and the decline has disproportionately hit households of those nearing retirement. But even before the asset bubble burst, Americans looked ill-prepared for retirement. A year later the situation is no better.

The Center for Retirement Research (CRR) at Boston College estimates that 43% of Americans are "at risk," meaning they would be unable to maintain their current standard of living in retirement. The good news: Most Americans seem to understand their situation. Only 19% of the population says they are prepared when they really aren't, according to a CRR survey. The bad news is that they don't seem to be doing much about it, whether through saving, paying off debt, or taking advantage of preretirement investment opportunities available to them.

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Investment Decisions for Those Nearing Retirement

By Jorden Meltz

During the current recession, and the past year more specifically, exposure to equities has left many retirement portfolios with substantial losses that could take years to make back.
For those not planning on retiring in the near future, they can follow the cyclical nature of the market and hope to make back their money over time; but those looking to retire in the near future lack this luxury. In the beginning of the year 2008 the Employee Benefit Research Institute released a study saying 40% of investors between the ages of 56 and 65 had 70% of their retirement accounts in equities. This age range is a crucial point where many begin to contemplate retirement, and thus heavy exposure to equities has left many of these people adjusting their retirement plans. Advisors are now recommending reducing equity possessions by 1-2% each year after a certain age; in an effort to minimize potential losses as one nears retirement. With that said though, it is still important to maintain a diversified portfolio, as this can be the key to your retirement portfolio’s recovery. A recent study showed that the combination of delaying retirement by one to two years and maintaining a well diversified portfolio would help those looking to retire in the near future return their portfolios to an adequate level faster then if the same people would have converted their money to cash, as they will be required to work even longer. For those looking to invest wisely as their potential retirement date approaches, it seems making adjustments towards safer levels of diversification each year may be the most effective way to keep one on their route to retirement.


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Planning for Late Retirement

By Leah Gorham

The vision of retirement in the United States is rapidly changing and we are beginning to see the workforce age as many people continue to work well into their 60’s, 70’s, and 80’s. According to the AARP Bulletin, the Bureau of Labor Statistics reports that between the years 2000 and 2008 the number of workers aged 65 to 69 rose 25 percent. Moreover, increases for workers in their 70’s were even higher- the 70 to 74 age group rose by 32 percent and 75 to 79 rose by 38 percent. As our economy struggles and drug and health care costs rise, many baby boomers and even Gen X-ers may not be able to comfortably retire in their lifetime. Debt is also a huge issue for Americans and recent studies show that many workers are approaching retirement with large amounts of debt. This is not the ideal situation one would like to be in as they approach retirement age.

However, late retirement may not always be a bad thing. Many people reach peak earning power in their 60’s and their expenses decrease as their kids finish college and they finish paying off mortgages. It is possible to rebuild savings and plan for a late retirement even in your 50’s and 60’s. In order to successfully plan for retirement in a relatively short time it is important to take stock of your current financial situation, think about potential opportunities and risks, look ahead and forecast where your current plan will take you, and then revise your plan with investment vehicles that fit suit your needs.

Source 1, Source 2, Source 3