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May 1, 2020

Social Security, Medicare, Veterans’ Benefits: Please Don’t Call Them “Entitlements”

Im entitled!
“I’m entitled!”

Social Security. Medicare. Veterans’ disability and other benefits. For tens of millions of Americans, they’ve come hard earned: through decades of work, hundreds of thousands of dollars in payroll tax payments, and through the sacrifice of health, mobility, sight, or other basic bodily functions most of us take for granted. These government programs are all that stands between many Americans and abject poverty.

For some politicians and opinion makers, however, they’re “entitlements,” or even “entitlement spending.”

Words mean things. They also imply and suggest things, often covertly. These words provide a particularly disturbing example of just how damaging a hidden emotional message that flies under the radar of critical thinking can be.

“Entitlement” sounds innocuous enough, but it’s objectionable because it conjures up the image of a privilege that neither was earned nor is really needed, but that the recipient refuses to forego because he or she is—well, entitled.

“Entitlement spending” takes this line of thought a step further. It suggests—and is intentionally portrayed as—a troublesome class of government programs that mindlessly crank out, as if on autopilot, ever increasing sums to the “entitled.” The high cost of these programs, so the reasoning goes, depletes the government’s coffers, and makes it necessary to cut funding in other areas where it is more urgently needed.

In reality, the exact opposite is true.
[Read more]

April 28, 2020

Simple Advice on Tapping Into Your Retirement Fund Early: Don’t

It’s no secret that the economy is currently in the midst of a slowdown. How serious is it? The old joke about the difference between a recession and a depression comes to mind: If your neighbor’s out of work, it’s a recession. If you’re out of work, it’s a depression.

Regardless of what you call the current economic situation, you may find yourself short of cash and looking around for a place where you can make up the shortfall. Then, a statement from your 401(k) or 403(b) plan arrives in the mail, and you think: hey, there’s tens (or hundreds) of thousands of dollars “just sitting there.” If I could just take a little out now…
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April 24, 2020

Gold as a Retirement Investment?

When people think of retirement investments, gold rarely crosses their minds. After all, gold doesn’t provide any income, and the whole purpose of saving for retirement is to replace the income shortfall when you’re not working any more.

To be sure, gold makes little sense for those who are already retired, and are seeking an investment that will generate income for day-to-day living. Future retirees, however, are less interested in current income than in growth and security of their retirement nest egg. For them, gold can be a part of a comprehensive retirement saving strategy.
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April 18, 2020

Is an “encore job” right for you?

If you’re a baby boomer nearing retirement age, and have been fortunate enough to be able to put aside a substantial nest egg, you may be in an “in between” place: ready, willing, and able to leave your job and try something else, but not ready to give up working entirely.

In the past, people in this position often did volunteer work, and that’s still a viable option. But more and more baby boomers are pursuing a different option: a new job that often involves public service, and usually doesn’t pay as well as one’s career job did, but that provides a deeper level of satisfaction. Marc Freedman, author of Encore: Finding Work That Matters in the Second Half of Life, calls these occupations “encore jobs.” Richard Leider and David Shapiro go even further, and talk about “putting your whole self into the second half of life.”

A recent article at TwinCities.com gives several examples. You can find thousands more real-life stories of people who have created meaningful encore careers at encorecareers.org.

April 15, 2020

Future retirees beware: Wall Street is lobbying to get its hands on your pension money

The big Wall Street banking and investment firms—the same fine people who brought us the subprime credit meltdown and the mortgage crisis—are now lobbying lawmakers to allow them to buy up and manage your pension fund money.

According to a recent Business Week report, roughly $500 billion—that’s half a trillion dollars—is currently sitting in so-called “frozen” pension plans. These are corporate pension plans that are closed to new members. Because corporations are cutting pension plans, new pension funds become frozen every day, and the trend is expected to continue. Among well-known companies with frozen plans are Alcoa, HP, Verizon, and IBM.

Currently, many of these plans are underfunded due to many reasons, such as fluctuations in the stock market. When this happens, the corporations can be forced to make up the shortfall. Thus, it’s no surprise that many companies would love to get rid of the pension plans even though they’re full of valuable assets.

And it’s no surprise that big Wall Street firms would love to take them over. They could charge their typical fees of 1% to 2% annually to manage them. That equates to billions of dollars of your hard-earned cash that would be gobbled up.

But the danger isn’t limited to a few percent points per year. As Business Week further reports, if the moneymen get the way, some 44 million future retirees’ money could be put at risk
[Read more]

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