A woman looking at a Guggenheim art exibit where an entire room is wallpapered with 100,000 $1 bills.

Money Is What You Make of It

Hans-Peter Feldmann, winner of the prestigious Hugo Boss Prize for contemporary art, displayed the precise amount of his $100,000 prize in this wall of overlapping dollar bills on display at the Guggenheim Museum in New York.

Feldmann’s art often groups similar items found in daily life to unearth their meaning. “Bank notes, like artworks, are objects that have no inherent worth beyond what society agrees to invest them with,” the museum said. “At its core, this formal experiment presents an opportunity to experience an abstract concept — a numerical figure and the economic possibilities it entails — as a visual object and an immersive physical environment.”

The exhibit is on display through November 2.Learn More

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Widows Have Social Security Options

Julie Taylor-Cooper, who worked for decades as an accounting manager, now scrapes by on her late husband’s Social Security checks and a $145-a-week job.

Many baby boomers like Taylor-Cooper may not realize there are various strategies for claiming full Social Security benefits that can have a dramatic impact on their retirement security.

“There are eight or nine options for retirees, spouses, and widows,” said Stephen Richardson, spokesman for the Social Security Administration. (Full disclosure: SSA funds this blog.)

Julie Taylor-Cooper from Over Fifty and Out of Work on Vimeo.

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Unseen Risks Challenge Consumers

Financial-product complexity isn’t talked about on Capitol Hill, where Congress is arming itself for battle royale over the appointment of Harvard Law School professor Elizabeth Warren to head the new Consumer Financial Protection Bureau.

But some economics and business professors are sticking up for the financial consumer, who they say faces an “ever-widening set of financial options” and “dizzying amount of information.”

“Households are expected to make decisions about pension plan contributions and payouts, to choose from a wide array of credit instruments to fund everything from home purchase to short-term cash needs, and more generally to assume a greater level of responsibility for their financial well-being,” Harvard economists Brigitte Madrian and John Campbell, Harvard Law professor Howell Jackson, and Peter Tufano at the Harvard Business School wrote in a recent paper.

“There is growing evidence that consumers make avoidable financial mistakes” with “nontrivial financial consequences,” they said.

Published in the latest issue of the Journal of Economic Perspectives, the paper used three case studies to support their call for more creative regulation: mortgages, payday loans, and 401(k)s. …Learn More

Identical cartoon men looking confused, all are in black and white except one.

Complexity Dogs Financial Consumers

There is a race between financial companies and their consumers, and the consumer is dead last.

It has become virtually impossible for regular folks to keep pace with Wall Street’s increasingly complex financial products or the confusing bells and whistles being attached to once-familiar products. Look no further than the “basic” checking account, which is no longer basic, according to a recent study by The Pew Charitable Trusts. And forget about deciphering “universal variable life insurance.”

Evidence of this complexity abounds in the personal finance section of The Wall Street Journal, which recently ran an article about the profusion of “draw-down” products to help retirees use their 401(k)s to lock in a steady stream of income. The newspaper also warned about the banking industry’s new push to sell “professional credit cards,” which aren’t subject to regulations that limit controversial billing practices.

Even with checking accounts, the devil is in the details. In “Hidden Risks: The Case for Safe and Transparent Checking Accounts,” Pew analyzed fees in 250 checking accounts – that’s how many were offered just by the nation’s 10 largest banking companies. Learn More

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Forced into Retirement? Downsize

Laid off from his job as a software engineer, Ken Wadland did something smart: he downsized.

After losing his job in June 2009, it immediately became obvious to Wadland that he could not afford his large house in the Rhode Island countryside. He sold it and purchased a condominium to reduce his housing costs, which are the largest single expense for most households.

The financial-services industry barrages baby boomers with tips for saving and investing their retirement nest eggs. But little attention is paid to the strategy of downsizing, an effective way for baby boomers to improve their retirement security by cashing in on the large amounts of equity built up in their homes over decades.

“I’d rather not have the expense,” Wadland, who is 60, said in this video.

Ken Wadland from Over Fifty and Out of Work on Vimeo.

Wadland explained how he came around to his decision in the online video series, “Over 50 and Out of Work,” which is featured occasionally in Squared Away.

His most recent job was at a large company, which once awarded him for being an innovator. “My passion is solving puzzles,” said Wadland. …
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Older Workers Behind the 8 Ball

Rudy Limas, a laid-off truck driver, resorted to applying for unskilled labor jobs – anything to get back to work and support his family.

“They look at your age and think, ‘He can’t handle it’ – even though I can,” the 61-year-old Oregon resident said. “They look at your age [and] they’re not going to hire you.””

Limas’ video interview, included in the online project, “Over 50 and Out of Work,” was selected by Squared Away for a series about the particular financial issues facing people approaching retirement age who lose their jobs.

Rudy Limas from Over Fifty and Out of Work on Vimeo.

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Toll High When Layoffs Hit After 50

The financial impact on older people who find themselves out of work goes far beyond the missed paychecks: it upsets well-laid plans for retirement.

Stan Bednarczyk, an engineer who was laid off in 2009 by a Michigan automobile supplier, has numerous concerns.  He can no longer contribute to the retirement account sponsored by his former employer.  And since Social Security is based on an individual’s 35 highest years of earnings, his future benefit may be lower when he retires.

The total dollar cost of his late-career joblessness, which he detailed in this video, is shocking.

 

Stan Bednarczyk from Over Fifty and Out of Work on Vimeo.

Bednarczyk was among 100 unemployed men and women interviewed for a powerful new video project, “Over 50 and Out of Work,” by New York journalists Susan Sipprelle, Samuel Newman, and Nikolia Apostolou. … Learn More

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