Yellowstone

At 62, You’re a ‘Senior’ at National Parks

Wolf pups are born in late spring and early summer in Denali National Park in Alaska.

Wolf pups are born in late spring and early summer in Denali National Park in Alaska.

No better time than retirement to take in our national parks at the leisurely pace they deserve.

At age 62, Americans can purchase a $10 park pass that is a life-time ticket to the magnificence of Glacier National Park, bison calves grazing with their mothers at Yellowstone, or peregrine falcons nesting at Acadia. But get the pass soon, though, because AARP reports the price will increase to $80.

Many people don’t learn the pass exists until they visit a national park where a ranger might or might not offer one.  The passes, which are issued by the National Park Service, include free access to the holder, a spouse and others riding in their car. The pass sometimes includes discounts of 50 percent at camping facilities.

It’s possible to purchase the life passes online for $20. The Park Service advises travelers planning a trip to contact a park in advance to make sure the $10 passes are available for purchase at that specific location.

While it’s generally not wise to claim your Social Security at 62, it’d be silly not to take advantage of this federal benefit.Learn More

Young Workers’ Hopes Confront Reality

Part time vs full time chartAs the post-recession job market continues to improve, so has young adults’ optimism about their future opportunities, a Federal Reserve Board survey shows.

What’s poignant about this youthful optimism is that a changing labor market is making it increasingly difficult for young adults to get their careers off to the right start.

Surely, they sense this. Nearly two-thirds of adults between ages 18 and 30 told the Federal Reserve in a 2015 survey featured in a recent webinar that their schedules in “permanent” jobs were changing daily, weekly, or monthly. They strongly prefer future job stability over higher pay, despite the trendy flexibility of the “gig” economy, Uber driving, and freelancing.

“Permanent employment is not the same as stable employment,” Amy Blair, the Aspen Institute research director for the economic opportunities program, said during the webinar.   “Without a stable floor, it’s difficult for a person to invest in himself or herself to build a career.”

The U.S. Bureau of Labor Statistics (BLS) has identified 30 jobs it predicts will have the fastest growth, generating 5 million jobs by 2024.  Most of the top 10 are characterized by part-time, low-paying, or seasonal work that can make it difficult to put together a full-time schedule, Blair said. Many are the types of jobs that also lack health benefits, 401(k)s, and paid-time off.

The BLS’ top 10 are: …Learn More

Fewer Older Americans Work Part-time

Flip Flop in Work Schedules chartIt’s now a given that more people in their 60s and 70s are choosing to keep working.

But a related trend rumbling beneath the surface isn’t so well-known: the share of working older people with full-time jobs has increased sharply – to almost 61 percent in 2016 from 40 percent in 1995 – as part-time work has become less popular.

The majority of older Americans are retired. But among those who do work, the move from part-time to full-time is “a major shift” in work schedules, concluded the Brookings Institution’s Barry Bosworth and Gary Burtless and George Washington University’s Ken Zhang in a report last year.  This is one aspect of the broader trend of rising labor force participation for the nation’s older workers.

Burtless said in an email that the likely reason for the shift toward full-time employment is that more of the growing number of people who are working in their 60s and 70s are simply staying put in full-time career jobs.

Not surprisingly, much more income for the entire U.S. population over 65 comes from work. In 1990, employment earnings made up just 18 percent of their income from all sources. By 2012, that had almost doubled to 33 percent, according to the Brookings report.

Fueling the increase in full-time work are changes to the U.S. retirement system, as well as an increasingly healthy older population: …Learn More

Paying Medical Bills is a Herculean Task

Hercules sculpture, Florence, Italy.

Hercules sculpture, Florence, Italy.

Medical bills are leaving “a lasting imprint on families’ balance sheets,” JP Morgan Chase concludes from its recent analysis of the anonymous checking and credit card account activity of some 250,000 bank customers.

With little available cash on hand, 53 percent of these families prepare to pay large, one-time medical expenses by waiting for an uptick in their income. Nevertheless, a year after the bill is paid, they are still struggling to patch the hole blown in their household budgets, according to the report, “Coping with Costs: Big Data on Expense Volatility and Medical Payments.”

The 2013-2015 account data show that family incomes tend to be 4 percent higher, on average, in the month a medical bill is paid. This doesn’t mean that people suddenly become Uber drivers or work more overtime hours. What is probably going on, the bank said, is that people “have delayed either receipt of medical treatment or payment of their medical bill until they were able to pay” – when the extra income arrives.

Tax refunds are one clear source of this income for paying large one-time medical bills. These payments were the most frequent around tax time, JP Morgan’s customer data show. But the $163 average increase in monthly income, mostly from tax returns, was small relative to the average $2,000 medical bill.

The damage done to family finances was apparent even a year after such bills were paid.  Credit card balances, which had been reduced prior to paying the medical bill, rose for at least a year following a payment. Meanwhile, spending on non-medical purchases, as well as the amount of cash on hand, decline in the aftermath as the families struggle to repair their household finances.

This dry but compelling report is a window into the Herculean feat of paying medical bills for some families.  It helps to explain why two out of three Republicans and Democrats in a Kaiser Family Foundation poll said that lowering their health care costs should be a top priority for any reform.

To read the full J.P. Morgan report, click here.Learn More

Growing tree

Women Get a Bigger Social Security Bump

The magic number is 35.

That’s how many years of earnings the U.S. Social Security Administration (SSA) uses to calculate every worker’s pension benefit.  But 35 years can be a tall order for the many boomer women who took time off or cut back on their hours to raise their children.  Nearly half of 62-year-old working women today didn’t make any money for at least one year in their earnings history on record with SSA.

But this also means they have more to gain financially than men from working longer, because each additional year of work substitutes for a zero- or low-earning year during motherhood in the benefit calculation, according to research by Matt Rutledge and John Lindner at the Center for Retirement Research, which sponsors this blog.

Beefing up one’s earnings record is actually one of the two ways that working longer raises monthly benefits.  The other, more familiar way is a benefit increase from delaying collecting Social Security.

Delaying claiming compresses the time period over which workers will receive benefits.  The resulting increase when they finally do start is known as Social Security’s “actuarial adjustment.”  Take the most extreme example: both men and women who begin their Social Security at age 70 receive 76 percent more per month from this adjustment than they would’ve gotten had they started at 62.

But it is women who generally gain much more from additional years in the labor force.

By working to 70, rather than retiring at 62, the average woman can increase her monthly Social Security check by 12 percent, the researchers found.  Adding this to the standard actuarial adjustment produces an 88-percent increase, from roughly $1,112 per month at 62 to $2,090 at age 70.

The earnings bump that 62-year-old men get from working to 70 is half as big – about 6 percent – because men typically already have had more years of higher earnings during their working lives.

A woman doesn’t have to work all the way to 70 either to benefit. Any period of delay will increase monthly benefits – and that will help. …Learn More

Crumbling wall

College Calculator Bridges Class Divide

A degree from a premier college can vault a teenager from a low-income family to the height of economic success as an adult.

College listTo date, 15 colleges have signed on to work with Levine, who initially created the calculator for applicants to Wellesley College, where he is an economics professor.

But disadvantaged students face a multitude of barriers to attending the nation’s top colleges, from getting the grades required to withstand stiff competition for acceptance to the absence of a degreed family member who can steer a child, niece or grandson through the process.

Phillip Levine is breaking down one barrier: the well-founded fear among low-income and even middle-class families that an elite liberal arts college is out of the question.

Levine designed a calculator to estimate how much an individual applicant will actually pay, after plugging in his or her family’s unique financial data, such as income, house value, mortgage amount, etc. – and the calculator is way easier than filling out a FAFSA form. Argh.

What’s new about Levine’s cost estimates is that they come from crunching family financial stats into a program that contains an individual college’s unique information about its financial aid and work-study programs, as well as how much current students pay based on their parents’ financial information [these data are supplied anonymously to Levine]. …Learn More

Get Paid What You’re Worth

 

“No one will ever pay you what you’re worth,” Casey Brown says in the Ted video above.

An employee’s value is also highest when unemployment is as low as it is now – 4.4 percent in April – and employers are scrambling to fill jobs.

Why would an employer pay more than it has to? With unions all but extinct, the burden falls on individuals to ensure they’re paid fairly or well.  Low unemployment provides workers with more leverage to get what we deserve. Unfortunately, many of us are not good at negotiating how much we earn.  Or we avoid it entirely, because we’re uncomfortable with talking money – especially women.

Women “say things like, ‘I don’t like to sing my own praises,’ ” Brown notes.

One time-honored way to test the waters is to get an offer for a job you might like that pays more than your current position. If your current employer values you, they’ll increase your pay to keep you. It can be a risky strategy.  In our free-wheeling labor “market,” however, it’s also the best way to learn what you’re worth, because there is only general information about compensation for different types of jobs.

In fact, management researcher David Burkus argues that the U.S. compensation system is built around secrecy.  “Keeping salaries secret leads to information asymmetry … [and] an employer can use that secrecy to save a lot of money,” he says in another Ted video. Translation: a lack of information makes it easier to under-pay you.

Unions know this. Historically, unions posted compensation in the different job tiers in each industry so workers would know what they were entitled to.

In place of unions, Elaine Varelas, recruiter for Keystone Partners in Boston, suggested other places to get this critical information: glassdoor.com, job recruiters, LinkedIn contacts, and even human resources executives at friends’ firms who might provide you with salary ranges.

“People owe it to themselves to do their homework and stop hiding under the discomfort,” Varelas says.

So get out there and learn something that will definitely be interesting – and possibly lucrative! Learn More