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  • Archive for 2017

    How To Keep Retirement Savings On Track While Caregiving

    Thursday, November 30th, 2017

    women

    November is National Family Caregivers Month—an annual event celebrated by WISER and partner organizations of family caregivers across the country. It’s a time to raise awareness of family caregiver issues, celebrate their efforts and increase support. This month’s theme “Caregiving Around the Clock” emphasizes that caregiving is a 24 hours a day, 7 days a week job.

    Caregiving is a consuming role—physically, mentally and financially—yet many who take on the work don’t identify with the job or fully realize the toll it takes. Often, it comes on unexpectedly, and sometimes the responsibilities may be shared. For example, caring for an elderly parent might be divided between siblings or a paid worker. Still, even if you are doing the actual work of caregiving part-time or just a few hours a week, the effort affects every part of your life. It becomes something you have to think about and plan for around the clock.

    The financial challenges of caregiving often come as a surprise to caregivers, as the day-to-day costs can really add up. Many smart retirement planners who believe that they have everything properly planned for are still often unprepared for the financial shock that caregiving for a family member can bring.  Even if the role of caregiver comes unexpectedly, there are ways to keep your retirement savings on track while caring for others.

    Create, and stick to, a household budget.

    Caregiving can affect your daily and long term spending in unexpected ways. That’s why it’s important to create and follow a budget. If you already have one, adjust it to consider your new expenditures. You may also have a lower income if you decide to stop working or reduce your hours. While you’re at it, have financial conversations with the person you’re providing care for, too. It’s easy for costs to balloon, and when mental and physical capacities diminish, the elderly can also be at an increased risk for being victimized by financial scammers.

    Try to avoid leaving your job.

    It can be tempting (or in some cases a necessity) to run to a loved one’s side when they need care. Doing so, though, can be extremely harmful to your finances. Leaving your job will mean losing compensation and benefits, and maybe skills and contacts. If at all possible, try to exhaust all other options before leaving your job or see if you can at least work reduced hours instead of quitting entirely.  If you have a retirement plan or pension through your employer, try to work at least as long as needed to be fully vested in your company’s retirement plan. If you are cutting back on hours, see if there is a minimum number of hours you can work to get reduced benefits.

    Be smart about the financial support you provide your loved ones

    Don’t drain your savings to help the person you are caring for financially. Usually, the major expense for older adults is health care. Drug plans run through Medicare and private companies may help cover the rising costs of medicine. Low-income seniors may also be eligible to receive help paying their premiums or for additional uncovered medical costs. Information about getting help paying for Medicare costs is available at Medicare.gov. The Eldercare Locator, a public service of the U.S. Administration on Aging is also a great resource for connecting with trusted resources in your community that can help with caregiving and other services for older adults and their families.  Visit eldercare.gov or call 1-800-677-1116.

    For more information and resources for managing your finances while caregiving, download WISER’s publication: Financial Steps for Caregivers. Included in the booklet is a budget worksheet that includes categories for caregiving costs.

    WISER’s 2017 Symposium: Wrap-Up & Highlights

    Thursday, September 28th, 2017

    On September 19, 2017, nearly 150 participants engaged on the issue WISER cares about most—women’s retirement security. The event was WISER’s 2017 Symposium: The Gender Story: A Symposium on Retirement Solutions for Women. 

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    The event began with opening remarks by WISER’s president, Cindy Hounsell, who set the tone for the event. She noted that since its inception, WISER has been working to help women navigate their financial lives towards a secure and stable retirement, and while much progress has been made, there is still so much work to be done. Following Cindy’s remarks, a dialogue on the gender story began. Kerry Hannon, who also wrote about the event, is an author and financial journalist. She along with the two other panelists, Catherine Collinson from the Transamerica Center for Retirement Studies and Jennifer Putney from Portfolio Evaluations, emphasized the importance of helping women to become confident when it comes to money issues.

    “Women have to get comfortable talking about money,” Putney said. “Talk about money with your friends. You don’t have to compare personal balance sheets, but you can talk conceptually.” Make a habit of it and planning for retirement will get easier.

    Mary Lazere gave the keynote address at WISER's 2017 Symposium.

    After that dialogue, which set the stage for the rest of the day, four panels of presenters covered the following topics: “Research and Strategies,” “A Ripple Effect- Expanding Retirement Literacy & Retirement Income,” “Opportunities for Change?,” and a congressional panel of Capitol Hill staff who discussed the status of current retirement policies. In between, attendees heard a keynote address from Mary Lazare, the principal deputy administrator at the Administration for Community Living, within the U.S. Department of Health and Human Services. Lazare explained that even for her, the challenges of being a woman and saving for retirement have been immense. She told of becoming a single mother and the financial strain and worry that presented.  But she also noted that savings can be transformative; once people start to save and see that savings grow, it can motivate them to keep going.

    Some stark figures were shared during the event. Janice Co, from Prudential Retirement, revealed that even though women now make up about half of the workforce, their retirement balances are on average about a third of men’s. She referred to Prudential’s study on women and the retirement income gender gap. A comprehensive study on caregivers, presented by Collinson and her colleague at Transamerica, Hector De La Torre, discovered that caregivers who make $25,000 pay about $100 per month on caregiving—making it extremely difficult to save for the future. This new study was released the day of the event. Additional presenters shared some of the many resources available to help people navigate complicated systems like Medicare, (The Medicare Rights Center) and prevent financial fraud and abuse among seniors (EverSafe).

    Materials from the event are available on WISER’s events page. The National Association of Plan Advisors also wrote up a great summary of the event.

    WISER is grateful to the speakers, participants, sponsors and partners who helped make the symposium a great success. Stay tuned to our website and facebook page for future WISER events!

     

     

    Considering Housing Costs in Retirement

    Thursday, August 10th, 2017

    TaxesThere are many things to think about as you approach retirement. Chief among them is how you will spend the money you have saved. It is difficult to know how long your retirement savings will need to last, so it is important to be frugal. However, spending too little money can also be detrimental to your personal safety, health and happiness. Finding the right balance between over and under spending requires planning ahead and budgeting. One of the most important things to consider when doing so are the various costs you will have during retirement, including health care and housing.

    When it comes to your housing during retirement, there is a lot of discussion of “livability.” But what does livability really mean? For a retired person, it can mean a lot of things. AARP created a livability index that scores different zip codes based on categories that included: housing (affordability and access), neighborhood (access to life, work and play), transportation (safe and convenient options), environment (clean air and water), health (prevention, access and quality), engagement (civic and social involvement) and opportunity (inclusion and possibilities). All of these things are important to consider when making retirement housing decisions, but most important of all is overall affordability.

    Many people want to “age in place,” which means continuing to live in the same home until the end of life, but doing so can become extremely costly. Oftentimes, homes will have to be retrofitted and remodeled to make them easier to use. This may include a stair glide, an elevator, a walk in tub, shower seats, and widened doors. These costs can total tens of thousands of dollars. Additional costs of aging in place include home health care services, cleaning services and meal delivery. Take these costs into consideration if you plan to age in place, and determine whether it is the best option. Oftentimes, it can be easier and more cost-effective to move out of a longtime home upon retirement into something better equipped for you as you age.

    There are many resources that can help you determine whether your best housing option in retirement is to age in place or move somewhere else, whether in your current area or somewhere totally new. The aforementioned AARP livability index provides helpful comparisons, as does Genworth Financial, which offers a tool that compares the average costs of home health care, adult day health care, assisted living facilities and nursing home care across states. Helpfully, it also allows calculation of future costs. Also take into account local tax laws when considering where to move—they can vary greatly and substantially impact how long your retirement savings can last. WISER’s fact sheets on long-term care are useful resources for retirement housing budgeting.

    Finally, keep in mind that if you have a definitive idea of how and where you see yourself living out your retirement years, it takes planning and preparation now to make those plans a reality.

    WISER

    About Us

    WISER is a nonprofit organization that works to help women, educators and policymakers understand the important issues surrounding women's retirement income. WISER creates a variety of consumer publications including fact sheets, booklets and a quarterly newsletter that explain in easy-to-understand language the complex issues surrounding Social Security, divorce, pay equity, pensions, savings and investments, banking, home-ownership, long-term care and disability insurance.

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