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How Your Data Get into the Wrong Hands

Chris Vickery, director of cyber-risk research for UpGuard in California, warned NPR listeners recently about a situation in which another high-technology company allowed 198 million voters’ personal information to become publicly accessible online.

When our non-financial information gets loose on the Internet, it can cause financial damage: “If a bad guy has your phone number and can get your PIN, they can, at 3 in the morning, get a code sent to your phone, listen to your voicemails, log in to your bank account and drain all your money,” Vickery said. “Phone numbers are more important than people realize.”  

Callout quoteSquared Away asked him to expand on what occurs when we freely hand over our personal data to retailers, financial institutions, and credit rating agencies, which then sell it to other companies or “data brokers” that buy and resell data.

Q. Is the dangerous situation you mentioned involving voters’ personal information still present, and has any financial fraud resulted from its release?

Vickery. I don’t know of any specific frauds that came out of that situation, but voter data in general – the more we make it available, the more fraud that is bound to come of it. It’s not a good idea.

Q. It has become routine to share our email address, as we’re required to do when we conduct business or buy things online. Is this a bad idea?

Vickery. Knowing that you use a particular email can be very useful to a bad guy. But the fact of the matter is there are a lot of people being careless with their emails. Getting mad at your best friend who gives your email address to an airline to share your arrival time might be a little unreasonable, but I don’t think it’s unreasonable to expect the companies to treat them more carefully than they have been. Companies that buy and sell your data create risks for you.  For example, have you heard of the concept of a “data base of ruin”? That is the concept whereby a dataset is created – maybe not all in one place – a healthcare breach here, a supermarket breach there – and this is all being brought together in one form where a malicious actor can search anybody and, based on one email address that you have authenticated, can get everything on everybody. This data base of ruin is starting to emerge. There are people seeking to do this, and there are already data sets commercially available that are scary in the level of detail they go into.  The more we can protect data and make those things unlikely to be used, the better off we will be.

Q. A 2013 Senate report found that data brokers buying and selling personal information sort people into various categories based on their financial circumstance – in essence there is a profile of every one of us, and it can be used for fraudulent purposes. How do these profiles get compiled?

Vickery. The roots of this stuff probably existed before I was born in 1984.  I can’t tell you exactly where it all came from, but things like voter data bases get rolled into these commercial purposes. Everything you buy at the grocery store with your special discount card gets rolled into these data bases. Anybody you provide data to is turning around and selling it to somebody. …Learn More

Washington DC

Retirement Researchers Meet Next Week

On August 3 and 4, the Retirement Research Consortium will hold its annual meeting in which retirement researchers from around the country will converge on Washington to present their latest findings.

The papers being presented next week will explore the impact on retirement from our health, work-life balance, and family ties, as well the millennial generation’s prospects for retirement. These are just some of the research topics. Click here for the full agenda.

For those who can’t attend, the CRR will provide live streaming of the presentations as they occur. In late August, they will be archived on the CRR’s website.

The Retirement Research Consortium includes the Center for Retirement Research (CRR) at Boston College, which sponsors this blog, as well as the Michigan Retirement Research Center, and the National Bureau of Economic Research. The research being presented at the conference is funded by the U.S. Social Security Administration.  Throughout the year, the findings will be covered in this blog.Learn More

Retrofitting Your Home for Old Age

Brickhouse Design Group Ltd.

Big advances in the construction industry are helping the elderly better maneuver around their homes, and they’re doing it in style.

Ramps no longer look like ramps; they are pleasantly lit walkways with stone paving. Compact pneumatic elevators squeeze into tight spaces.  The lip at the entrance to the shower – the one an elderly person can trip over or that blocks a wheelchair – has cleverly been eliminated. Watch this recent webinar to find out how.

And here’s an interesting idea: a reverse mortgage is one way to pay for the upgrades required for seniors who want to remain in their homes as they age.

That is the punch line in the webinar, which is sponsored (not surprisingly) by the National Reverse Mortgage Lenders Association (NRMLA).  NRMLA confirms that some loan originators report that the proceeds from federally insured reverse mortgages are being used for the purpose, though this is not widespread – yet.

Many are, however, considering it: one in four older households in a 2014-2015 academic survey reported, after they had received reverse mortgage counseling, that they planned to use their funds to pay for home improvements.

This webinar isn’t exactly exciting. But it will interest baby boomers who are either caring for elderly parents or thinking about their own old age.  One poll found that 87 percent of older Americans would not want to move into a nursing home. But if they want to age in their homes, there’s apparently a lot of work to be done.

“The bulk of long-term care will occur in single-family, owner-occupied homes,” predicted one webinar presenter, citing a study. “But the homes aren’t prepared.” …Learn More

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Retirement Calculators: 3 Good Options

The Internet offers many free calculators to baby boomers wanting to get a better handle on whether their retirement finances are on track.

The operative words here are “on track,” because each calculator has strengths and weaknesses.  Calculators aren’t capable of providing a bullet-proof analysis of the complex factors and future unknowns that will determine whether someone has done the planning and saving required to ensure a financially secure retirement.

With that caveat, Squared Away found three calculators, listed below, that do a good job. They met our criteria of being reliable, free, and easy to use.  Many other calculators were quickly eliminated, because they were indecipherable or created issues on the first try.

Most important, each calculator selected covered the assumptions crucial to an accurate analysis. All ask such obvious questions as how much an older worker and spouse (or single person) have saved, their portfolio’s returns, and estimates of their Social Security and pension income.  The first calculator below asks how much money the user wants to leave to his children, and all three include the user’s home equity, a major resource that most retirees are loath to tap but are under increasing financial pressure to consider. Also, the first two ask more detailed questions – and are more time-consuming – than the third, which is the best option if you want just a rough estimate of where you stand.

Finally, this blog’s writer tested each calculator and compared the results with her personal adviser’s customized analysis. Each time, the outcomes were in the same ballpark as the adviser’s.  A fourth good option is to use the calculator provided by the financial company managing your employer’s 401(k) – most of the major providers offer them. …Learn More

Fourth of July

Celebrate the 4th!

Many of you are enjoying a long weekend or taking the entire week off. Enjoy your vacations and drive safely.

As the summer kicks into high gear, we’ll continue blogging twice a week about retirement and related personal financial issues.Learn More

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Top 10 Blogs Explore Weighty Issues

Millennials’ reliance on their parents, retirement finances, and long-term care – Squared Away readers had some serious topics on their minds during the first half of the year.

Here are the 10 most popular blogs, ranked by the number of page views each received between January and June:

  • Retiree Benefits: Tale of 2 Cities (and States)
  • Get Dental Work Before You Retire
  • Long-Term Care Insurance Goes Uptown
  • Long-Term Care on a Boxed Wine Budget
  • The Benefits of Late-Career Job Changes
  • Retirees Don’t Touch Home Equity
  • People Lack Emergency Funds, Tap 401(k)s
  • Managing Money with Cognitive Decline
  • Why Parents’ Home is the Millennial Crib
  • Our Stubborn State of Financial Illiteracy …

Learn More

Is There a Student Loan Gender Gap?

Now comes the toughest part of borrowing money for college: paying it back.

There is much for this year’s crop of graduates to learn.  For example, the federal government gives you a reprieve after graduation, usually six months, before requiring you to start repaying your debts. But did you know that interest builds up during this “grace period”?  Starting payments right away reduces how much you’ll have to pay back.

Making repayment mistakes or not having a plan can also be very costly.  Click here for some tips to avoid these mistakes.

Here’s another issue: women borrow slightly more money for undergraduate degrees than do men but earn less after college and seem to have more difficulty paying back their loans.

In 2012, women borrowed $21,000 for an undergraduate degree, on average, compared with about $19,500 for men, according to a new study by the American Association of University Women (AAUW).

Men are able to pay their debt back faster too. During the first four years after graduation, men pay off 38 percent of their outstanding college debt. Women pay about 31 percent. Women graduates with student debt are also more likely to report more difficulty making their rent payments, AAWU’s survey found.

Many questions remain unanswered. What explains the differences? Also, the study doesn’t control for how much young adult men and women earn in their jobs. Nor does it sort out the implication of different payoffs for the different types of degrees that men and women choose.  Careers in software engineering or nursing are more likely to justify hefty loans than degrees in film or women’s studies with uncertain career paths.

This study raises interesting issues, which future research will hopefully address.

In the meantime, women, it’s something to think about. Learn More

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