No-Free-Lunch Seminars for Seniors

Economists like to joke about free lunches. The subtext is that there’s a cost to everything.

A free lunch is also literally how high-pressure financial companies sometimes lure older Americans into a room to hear their investment pitches. The FINRA Investor Education Foundation says some 6 million older Americans have attended seminars in return for a free lunch. Every year, my mother’s retirement community outside of Orlando hosts a handful of these seminars, which are presented by financial firms, insurance companies, and even funeral homes.

FINRA warns that they can pressure seniors into making “unsuitable, even fraudulent investments.” The above FINRA video explains what’s behind the free-lunch presentations and proposes some questions that people can ask to determine the legitimacy of what’s being sold.

But it’s probably better to do what my mom does: find something fun to do instead.Learn More

Personal Finance Info – now in Spanish

The wealth of good financial information available from government, university, and non-profit organizations is an antidote to the television and Internet advertisements selling financial products. Squared Away regularly compiles these resources for our readers’ benefit. This newest installment starts with some that are available in Spanish for the nation’s growing Hispanic population:

  • The FINRA Investor Education Foundation translated its short video about why people make bad financial decisions into Spanish. “Pensando Dinero: la psicología detrás de nuestras mejores y peores decisiones financieras” – or “Thinking Money” – explores how emotions get in the way of common sense when making decisions about money. Several other FINRA resources also in Spanish include a glossary of online financial publications and a video about financial fraud. (“Pensando Dinero” is based on a documentary produced for public television; a free DVD of the English-language documentary is also available.)
  • “Thinking Fast and Slow” by Daniel Kahneman was an international bestseller about behavioral economics. To explore another insider’s take on this field, read what one of the field’s founders says about it. Richard Thaler’s latest book, “Misbehaving,” will be published in paperback in May. A New York Times review called it “a sly and somewhat subversive history of his profession.”
  • In just two years, the housing boom taking place in many parts of the country has added
    $1 trillion to the value of home equity held by people ages 62 and older, reports the National Reverse Mortgage Lenders Association. For retirees wondering whether it’s appropriate to turn some of their equity into income, the Center for Retirement Research at Boston College, which supports this blog, has produced a booklet on ways retirees can use their home equity, including through reverse mortgages. The online version is free, and a paper version costs a whopping $2.75.

Learn More

Year-end Thank You to Our Readers

Holiday thank you

To stay current on Squared Away blog posts in 2016, we invite you to join our free email list. You’ll receive just one email each week – with links to the two new posts for that week – when you sign up here.

Readers can also follow the blog on Twitter @SquaredAwayBC or on Facebook.Learn More

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Readers’ Picks in 2015

Squared Away readers should know this ritual by now. We consult Google Analytics to determine the articles with the most reader traffic over the past year.

This blog covers everything from student loans to helping low-income people improve their lot. But this year’s Top 10 was dominated by one topic: retirement.

Readers’ favorites are listed in order of their popularity, with links to each individual blog:

  • Navigating Retirement Taxes
  • Medicare Primer: Advantage or Medigap?
  • Why I Dropped My Financial Adviser
  • The Future of Retirement is Now
  • Annuities: Useful but Little Understood
  • Winging it in Retirement?
  • Fewer Need Long-Term Care
  • Misconceptions about Social Security
  • Late Career Job Changes Reduce Stress
  • Mortgage Payoff: Freedom versus the Math

To stay current on our Squared Away blog in 2016, we invite you to join our free email list. You’ll receive just one email each week – with links to the two new posts for that week – when you sign up here.      Learn More

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Social Security Delay: the Value to You

What matters most in retirement is how much money comes in the door every single month. That’s why this blog – and its sponsor, the Center for Retirement Research – hammers away at the wisdom of delaying when you sign up for Social Security in order to increase the size of your monthly checks.

So here’s a very quick project for the long Thanksgiving weekend: insert your birthday and earnings into this new online tool to get an anonymous, back-of-the-envelope estimate of how much a delay is worth to you.

The age you claim your benefits is crucial, because two out of three households rely on Social Security benefits for more than half of their retirement income. Yet the majority of people still sign up before they’re eligible for their full benefit, which is age 66 for most baby boomers. Monthly benefits are increased for every year of delay, up to age 70.

The cool part of the tool, released last week by the Consumer Financial Protection Bureau and the Social Security Administration, is the sliding feature. It shows how much monthly benefits rise if you change your claiming age from 62 to 66 to 70. Click here to try the tool. …Learn More

The Common Struggles of Working People

Brandi and Frank, the hypothetical couple in the above video, are drawn from extensive nationwide interviews with real Americans who work extremely hard, live modestly, and carry their financial anxiety through the day.

Ten of these families were also featured in written profiles by the U.S. Financial Diaries project. Like millions of working Americans, these families are buffeted by economic forces ranging from stagnating paychecks to a scarcity of employer benefits in low-wage jobs. The project identified common traits running through their financial lives.

They are continually trying to improve their lot, with education or by taking on extra jobs and by saving. Retirement saving, however, is a luxury – their saving is done to pay the unanticipated emergency or surprise expenses that inevitably crop up, according to the Diaries, a joint project of New York University’s Financial Access Initiative and the Center for Financial Services Innovation.

Saving for the short-term is also necessary because their sources of income can be erratic, requiring tricky rearrangements of their household resources. When they incur on-the-job expenses, employers’ reimbursements are often slow to arrive. Their monthly expenses often exceed monthly income, which can lead to late payments of utility bills or delays in medical treatment.

The following are short descriptions of some of the families profiled in the Diaries’ worthwhile project …Learn More

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New Online Financial Resources

Squared Away periodically alerts readers to information online that might be useful to them.  These three crossed the transom in August:

  • Natural disasters quickly turn into financial disasters. On Hurricane Katrina’s 10th anniversary, the National Endowment for Financial Education and other organizations have released a guide, Disasters and Financial Planning.  The guide includes tips on how to insure properly against hurricanes, floods, or forest fires and how to hire contractors to make repairs after disaster hits.
  • The U.S. Social Security Administration posts a raft of brochures online to explain everything from how to get your newborn’s Social Security number or replace your old one (citizen or non-citizen, international students) to disability information for veterans. There’s also information on federal benefits many people may be unaware of. For example, low-income Medicare enrollees can apply for extra help – up to $4,000 per year – to pay for their prescription drugs. Many of the brochures come in multiple languages, including Somali and Vietnamese.  Click here to see the full list of publications on socialsecurity.gov.
  • The Center for Financial Services Innovation’s Consumer Financial Health Study sorts Americans into four financial states: “unengaged,” “tenuous;” “at risk,” and “striving.”  They’re characterized by typical behavioral characteristics of how they handle – or fail to manage – their finances. For example, the unengaged typically “do not know how much their monthly debt payments are.” …

Learn More

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