Financial Planning, Retirement Issues


Signs and Symptoms of Baby Boomer Elder Abuse

September 21st, 2017 ernie Posted in Senior Life Style | No Comments »

 

What are the signs and symptoms of baby boomer elder abuse? They are many and anyone who is providing care, or is a friend or a family member of the senior needs to be on the alert. Often the most visible are bruises that really should not be there. Falls do take place causing broken bones etc. These can cause bruises as well. But if there is no fall and the senior you are visiting has a lot of bruises it might be worth your time investigating.

Another common form of elder abuse is financial which is the focus of this web site. Financial abuse takes place when there is outright stealing or when the senior is being charged for things that they really should not pay for or are paying too much for. Often care givers, whether they are family members or not cannot resist the monetary attraction. Several people should jointly monitor the seniors funds to make sure that their savings are not being prematurely spent leaving them destitute.

Elder Abuse from a Financial Perspective

Elder abuse from a financial perspective is pretty difficult to uncover unless there are large amounts of money involved. Regardless of the amount of savings and investments that a senior might have, family members should always monitor what is being spent. Unusual amounts or one time large amounts that you are not familiar with should be investigated.

More than one person should be checking accounts and spending levels. Money can corrupt no matter who it is. With two people monitoring accounts etc, there is less chance of collusion and financial elder abuse.

Elder financial abuse can come in many different forms. One time I was cutting my father in-laws lawn and a person drove in to the yard. He indicated that he was here to collect the monthly fee for the newspaper. The amount was around $45. I asked him how long he had been delivering the paper and how long he had been collecting cash from my father inlaw. This gentleman was around his mid 40’s and indicated he was relatively new, but it had been several months since he started collecting.

I got his name, his license number and then informed him that I had prepaid the subscription for the paper and that no collections should have been initiated. He quickly realized that the jog was up and left before I could say much more. What a scumbag. Taking money from the elderly. It was a small amount but still it makes him a scumbag.

I called the news paper and got him fired. However I am sure he has continued his ways and is taking money from seniors as I write this note.

The point of the story is that everyone must be alert. There are thieves everywhere. The elderly are particularly vulnerable.

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Baby Boomers Elder Abuse

September 7th, 2017 ernie Posted in Senior Life Style | No Comments »

baby boomers elder abuse Many baby boomers, born between 1945 1954 are now retiring. Although the financial advisor community, banks and government have talked about building sufficient retirement savings to cover them during retirement, many do not have sufficient funds  to take them through retirement. On top of that there seems to be in increasing level of elder abuse that is taking place. As more and more baby boomers move into their late retirement years this is becoming an increasing problem.  The chart summarizes the various kinds of elder abuse that takes place. Often the most visible or those of physical abuse. But there are five other types of abuse, including financial, verbal, emotional, neglect and even abandonment. How can people be so cruel and treat their elderly family members this way? How can care workers treat people this way?  It can be a terrible thing to experience this kind of abuse. Having lots of money does not always protect you either.

Elder abuse in our Community

Unfortunately in our society everything is driven by sex and money. If it is not sexual abuse, it is some form of abuse that is triggered by the greed of grabbing their money. Sometimes it is the fact that they don’t have enough money to pay for the services that seniors need. We cannot emphasize enough that baby boomers planning to retire  need to make sure that they have sufficient funds to pay for top quality care during their later years.

In addition family members need to take steps to protect their elder parents or relatives. Always have two members of the family looking after a senior, and two members of the family looking after the financial affairs. If you suspect any kind of elder abuse, whether it’s emotional, financial or other takes immediate steps to rectify the situation.

There are the obvious criminal cases that can be dealt with when someone is exposed to physical abuse and the perpetrator is caught and prosecuted. But there many more subtle situations that are never deal with that trouble many seniors today. Elder abuse is rampant and in many cases it is our own family members that are the guilty ones.

Examples of Elder Abuse

What about the son or daughter who slowly drains their parents bank accounts leaving them destitute and abandoned? What about care givers who are rough in their treatment? They never leave bruises, but you know that there is something going on. Then there are situations where they get the parents to pay for everything. The kids could even be well off.

Abandonment is one of the worst. Not everyone wants to look after someone who is old and frail. They may not have the patience and the personality. The senior ends up living by themselves and living as best they can until they cannot look after themselves any longer. They depend on the good will of neighbors who take pity. Where is the family in this situation?

Knowing that this is going on will at least help seniors takes steps to prepare for this situation. Plan now how your frail years will be to ensure that they are as good as they can be. We are going to write a series of posts on this subject so stay tuned.

 

 

 

 

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What is your Financial Life Expectancy

August 21st, 2017 ernie Posted in Retirement Planning | No Comments »

If we all knew how long we were going to live, planning our finances would be easy. Many people base their estimate on how long their family lived. This can be a good indicator as long as your parents died of natural causes and lived a simalir life to your own. We now know that this comparison is not always accurate.

With improvements in food, medical treatment and knowledge about how to take care of ourselves, we are all living longer. The question now is what is your real life expectancy and how will you plan for it financially?

Life Expectancy and Financial Impacts

The first step is to figure out your life expectancy based on genetics. Let’s assume both parents lived to age 75. It could be an easy assumption that their children will live until around age 75 as well.

With the help of a financial advisor you could use this age as a guide to calculate how much money to take out if your savings so that it will last until your demise. This is a first step only. You may find you have to work a bit longer to achieve the life style you want while in retirement. Or you have sufficient savings already.

Now assume you will live 10 years longer. Better food, better medical care and a healthier life style could contribute to living 10 or even 20 years longer than your relatives!

Adjust your financial plan for a longer period. Will you have sufficient funds? Will you need to work longer and save more? Perhaps you will need to cut back on expenses to ensure a comfortable life style as you live longer.

Do your analysis now and make some informed decisions to ensue you have sufficient funds to meet your extended life expectancy!

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Do I Have Enough Savings for a Secure Retirement 

August 7th, 2017 ernie Posted in Retirement Saving, Uncategorized | No Comments »

secure retirementThis is the main question we all have about our retirement future. How can we figure out what our future will be ? How long will we live? Should we base our life expectancy on how long our parents lived? Or perhaps our neighbors since we share a similar economic situation. A secure retirement means that we need to make an estimate of how long we will work, how long we will live and many other assumptions. In this post we will discuss these issues and others that many consumers need to factor into their decisions.

Will You Have a Secure Retirement

If your already retired and wondering if you have enough to live comfortably during retirement, it is time to take stock of a number of things about your life style and your situation. Here are a few, but bottom line, your income must be the same or more than your expenses, plus you needs savings set aside for emergencies that invariably will come along.

Track expenses – to get an understanding of where your money is being spent. If you need to reduce, then you can start here and identify those areas where you can reduce and how much it will save you.

Track income – to understand how much is coming in and whether it will be enough or not. If not you may have to reduce expenses, go back to work, even if it is just part time.

Re-evaluate every 6 months – life events and inflation happen all of the time. Recheck all of your calculations on a regular basis to make sure all of your assumptions are still accurate.

Balance income and expenses – as we said income must be higher than expenses otherwise it will eat into your savings quickly leaving you without enough to live on when you are much older.

Earn more, go back to work etc – going back to work can make a huge difference in both your life style as well as your savings. Your money will last much longer.

Reduce expenses – do you really need to eat out all of the time? Can you make cost cutting painless. Look at all of your expenses and make a decision on those that can be reduced.

Downsize , rent , move in with the kids – if you must, these are drastic reductions that can be made to reduce your expenses.

Obtain expert help – find a financial advisor you can trust and review your situation with him or her. You may want to get several recommendations before settling on one direction or another.

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Lifetime Pension Payments or lump Sum?

July 21st, 2017 ernie Posted in Pension Plans | No Comments »

Lifetime Pension Payments or lump SumShould we take a buyout which amounts to a lump sum payment or should we take a lifetime pension with benefits? There are pros and cons to both scenarios. Some people will be more comfortable with the knowledge that they will receive a fixed amount for as long as they live. While others feel better about managing their own money and having that lump sum to leave to their children as an inheritance. We will list some of the pros and cons for each. There is no right or wrong answer to this question. It really depends on the person, their situation in life and their risk tolerance.

Lifetime Pension Payments

  • Fixed pension for as long as you live
  • May include indexing for inflation
  • No perceived risk, many are guaranteed
  • You don’t need to worry about the impact of the markets
  • Cannot draw down in an emergency
  • If you die early the money is gone, payments stop
  • There is no inheritance for your children

Lump Sum Payment

  • Lump sum is paid into a registered plan
  • You have control over the investments
  • You also have control over how much is withdrawn
  • In an emergency more money can be withdrawn
  • Must take responsibility for managing into retirement
  • Must plan for lifetime withdrawals
  • Risk of running out of cash before you die
  • If you die early, all money left overs goes to your heirs
  • May lose sleep at night, do you have enough to last

As you can see there are some big advantages and disadvantages to both. Work with an advisor to assess what your payments would be in both scenarios and make the right decision for your situation and risk tolerance.

 

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The FUTURE is approaching NOW

June 21st, 2017 ernie Posted in Life Style | No Comments »

the future is approaching nowThe FUTURE is approaching so fast that they cannot handle it. Many people who read science fiction, will already realize that some of the things that were mentioned in science fiction books a few years ago are now reality. The FUTURE is approaching NOW and we better hang on to our hats because it will only speed up! Technology will change everything. If you brought someone from even 50 years ago into present time, they would be shocked at the devices we have and how our lives have changed.

In 1998, Kodak had 170,000 employees and sold 85% of all photo paper worldwide.
Within just a few years, their business model disappeared and they went bankrupt.

What happened to Kodak will happen in a lot of industries in the next 10 years and, most people won’t see it coming. Did you think in 1998 that 3 years later you would never take pictures on film again?

Yet digital cameras were invented in 1975. The first ones only had 10,000 pixels, but followed Moore’s law. So as with all exponential technologies, it was a disappointment for a time, before it became way superior and became mainstream in only a few short years. It will now happen again with Artificial Intelligence, health, autonomous and electric cars, education,3Dprinting, agriculture and jobs. Welcome to the 4th Industrial Revolution. Welcome to the Exponential Age .

The FUTURE is approaching NOW

Software will disrupt most traditional industries in the next 5-10 years.
Uber is just a software tool, they don’t own any cars, and are now the biggest taxi company in the world.

Airbnb is now the biggest hotel company in the world, although they don’t own any properties.
Artificial Intelligence: Computers become exponentially better in understanding the world . This year, a computer beat the best Go-player in the world, 10 years earlier than expected.
In the US , young lawyers already don’t get jobs. Because of IBM’s Watson, you can get legal advice (so far for more or less basic stuff) within seconds, with 90% accuracy compared with 70% accuracy when done by humans.

So if you study law, stop immediately. There will be 90% less lawyers in the future, only specialists will remain.

Watson already helps nurses diagnosing cancer, its 4 times more accurate than human nurses.
Facebook now has a pattern recognition software that can recognize faces better than humans. In 2030, computers will become more intelligent than humans. (NEVER!/Albert)

Autonomous cars : In 2018 the first self driving cars will appear for the public. Around 2020, the complete industry will start to be disrupted. You don’t want to own a car anymore. You will call a car with your phone, it will show up at your location and drive you to your destination.

You will not need to park it, you only pay for the driven distance and can be productive while driving.

Our kids will never get a driver’s license and will never own a car.

It will change the cities, because we will need 90-95% less cars for that. We can transform former parking spaces into parks.

1.2 million people die each year in car accidents worldwide. We now have one accident every60,000 miles (100,000 km), with autonomous driving that will drop to 1 accident in 6million miles (10 million km). That will save a million lives each year .
Most car companies will probably become bankrupt. Traditional car companies try the evolutionary approach and just build a better car, while tech companies (Tesla, Apple, Google) will do the revolutionary approach and build a computer on wheels.

Many engineers from Volkswagen and Audi; are completely terrified of Tesla.
Insurance companies will have massive trouble because without accidents, the insurance will become 100x cheaper. Their car insurance business model will disappear.

Real estate will change. Because if you can work while you commute, people will move further away to live in a more beautiful neighborhood.

Electric cars will become mainstream about 2020. Cities will be less noisy because all new cars will run on electricity.

Electricity will become incredibly cheap and clean: Solar production has been on an exponential curve for 30 years, but you can now see the burgeoning impact.
Last year, more solar energy was installed worldwide than fossil. Energy companies are desperately trying to limit access to the grid to prevent competition from home solar installations, but that can’t last. Technology will take care of that strategy.

With cheap electricity comes cheap and abundant water. Desalination of salt water now only needs 2kWh per cubic meter (@ 0.25 cents). We don’t have scarce water in most places, we only have scarce drinking water. Imagine what will be possible if anyone can have as much clean water as he wants, for nearly no cost. (wishful thinking???!!!)

Health: The Tricorder X price will be announced this year. There are companies who will build a medical device (called the “Tricorder” from Star Trek) that works with your phone, which takes your retina scan, your blood sample and you breath into it.

It then analyses 54 bio-markers that will identify nearly any disease.. It will be cheap, so in a few years everyone on this planet will have access to world class medical analysis, nearly for free Goodbye, medical establishment.

3D printing: The price of the cheapest 3D printer came down from $18,000 to $400 within 10years. In the same time, it became 100 times faster. All major shoe companies have already started 3D printing shoes.

Some spare airplane parts are already 3D printed in remote airports. The space station now has a printer that eliminates the need for the large amount of spare parts they used to have in the past.

At the end of this year, new smart phones will have 3D scanning possibilities. You can then 3D scan your feet and print your perfect shoe at home.
In China, they already 3D printed and built a complete 6-storey office building. By 2027, 10% of everything that’s being produced will be 3D printed.

Business opportunities: If you think of a niche you want to go in, first ask yourself: “In the future, do I think we will have that?” and if the answer is yes, how can you make that happen sooner?

If it doesn’t work with your phone, forget the idea. And any idea designed for success in the20th century is doomed to failure in the 21st century.

Work : 70-80% of jobs will disappear in the next 20 years. There will be a lot of new jobs, but it is not clear if there will be enough new jobs in such a short time. This will require a rethink on wealth distribution.

Agriculture : There will be a $100 agricultural robot in the future. Farmers in 3rd world countries can then become managers of their field instead of working all day on their fields.

Aeroponics will need much less water. The first Petri dish produced veal, is now available and will be cheaper than cow produced veal in 2018. Right now, 30% of all agricultural surfaces is used for cows. Imagine if we don’t need that space anymore.

There are several start-ups who will bring insect protein to the market shortly. It contains more protein than meat. It will be labelled as “alternative protein source” (because most people still reject the idea of eating insects).

There is an app called “moodies” which can already tell in which mood you’re in. By 2020 there will be apps that can tell by your facial expressions, if you are lying. Imagine a political debate where it’s being displayed when they’re telling the truth and when they’re not.

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How can I retire early?

May 21st, 2017 ernie Posted in Financial Independence | No Comments »

Almost everyone at some time in their lives wonder, how can I retire early? They might be having a tough day at work. Or perhaps they are envious of someone who is retired and the life they are able to leave. When you ask yourself this question, how can I retire early, the next step is critical. If you want to retire early, consumers need to put a plan in place and answer the following questions. Then they must work towards these goals to achieve their objective. Unless you are lucky enough to win the lottery, most of us will just have to work hard to make it happen.

Questions to Help Answer – How can I retire early?

These are the questions that will get you started and help achieve your plans. Work with an expert to ensure that you are considering the right questions and making the correct assumptions.

  • How much should I save
  • How should I invest
  • What will my housing cost in Retirement
  • How much will health care cost
  • Manage your tax liabilities

How much should I save – how much income will you need? What interest rate will you assume? How many years do you have to save towards retirement? What pensions will you receive?

How should I invest – Most experts will tell you focus on blue chip, diverse investments that will protect you from catastrophic losses. The market will go up and down.  Over the long term it should continue to increase providing growth in addition to your savings and help with your retirement goals.

What will my housing cost in Retirement – Will you stay where you are, downsize, move in with the kids or live in a seniors home. Each one of these has different costs and must be factored into your planning.

How much will health care cost – this is a huge assumption with huge impacts. What health coverage will you have? What is your co-pay? How will you afford your medical costs.

Manage your tax liabilities  – taxes are present in life and death. Focus on minimizing your taxes to ensure that more money is left in your pocket.

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Best Way to Avoid Boredom in Retirement

April 21st, 2017 ernie Posted in Retirement | No Comments »

Many people find they do not have enough hours in the day during retirement. While others are looking for help. They want to find the best way to avoid boredom in retirement. With so many people retiring these days, many are struggling, especially after the first year. They spend the first year travelling, completing projects around the house and visiting friends they have not seen for several years. They just did not have time when they were working. Suddenly they have all of this free time and they make the most of it. But what happens after the first year when all of the projects are completed? The budget has been max’d out and your friends are also traveling. Now what do you do?

Best Way to Avoid Boredom in Retirement

There are three important elements that consumers need to consider to avoid boredom in retirement. They are:

  • Sufficient budget
  • Good health
  • A purpose to your life

Having only one or two of these is really not sufficient. In fact having a purpose in life is probably the most important of them all. If you do not have a reason for getting up in the morning, it does not matter how healthy you are or how much money you have. You can survive on less money and varying degrees of health. Having a purpose in life is what keeps you going, challenges you and makes life interesting.

Everyone is different. Your purpose in life will be different from everyone you know. Whether it is a second career, pursuing hobbies, looking after the grand kids or volunteering it is something that you look forward too each day. Find what works for you. Try different things until you have that interest in life that makes you get up in the morning looking forward to the day.

 

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Big problem for new retirees

April 7th, 2017 ernie Posted in Uncategorized | No Comments »

problem for new retireesInitially your really busy catching up on all of the things you have been ignoring or delaying until your retirement. You knew that there would be time for these things once you finished work so you put them off. Many retirees find themselves very busy during the first few months or even the first year, but then something happens. It is the typical Big problem for new retirees. Initially they enjoy sleeping in, they get to travel on their schedule and there is a lot less stress in their lives. This new found freedom is actually pretty nice. But over time they run out of things to do around the house. Travel budgets get depleted and while it is nice to sleep in, you have the rest of the day to fill!

Many people suddenly find themselves missing the social interaction they had with people at work. They miss the fulfillment, achievement, and recognition they got from doing their jobs. They try to keep busy, but keeping busy is just not fulfilling any longer. Now what do they do for the rest of their retirement years?

Big problem for new retirees – Boredom

The B word comes into their vocabulary. They are bored and do not know what to do with their time. There three things you need to enjoy retirement. You need your health, you need a good financial plan that matches your lifestyle plans and you need the most important thing, a purpose in life.

For some consumers finding a purpose in life means looking after the grand kids. For others it means returning to the work force in a new career. Many start hobbies which turn into jobs. The most important element that these thing s must have is that they look forward to getting up in the morning and pursuing their purpose.

Everyone has something different. Each person needs to find out what works for them. Their purpose could change over time as well. They might start out on a hobby which leads to other things that they find more interesting. Whatever it is, try many alternatives until you find the one that works for your personal situation at your time of life.

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Financial Independence in Retirement 

March 21st, 2017 ernie Posted in Financial Independence | No Comments »

Financial Independence in Retirement Much was made of the slogan freedom 55. At the time it signified that a person could retire at 55, living the quality of life they wanted on the savings they had accumulated. Unfortunately many people lost a lot of money during the recessions in 2000 and 2008/09. Freedom 55 has been set aside for the time being. We all want to have financial independence in retirement. More importantly, we want to be financially independent at a certain point in our lives so that we can make our own decisions about work vs retirement.

In fact wouldn’t it be nice at age 45 to have sufficient income to allow you to make a decision about continuing to work, changing jobs or travel for awhile without worrying about money. There is a way to do this and it is just simple mathematics.

Financial Independence in Retirement

All consumers need to do is invest 10% of their incomes regardless of how much you make in a diversified group of stocks. They need to be blue chip stocks and they need to pay dividends. They should have an excellent record of paying dividends and increasing their dividends. While it is slow and boring, it is like the race of the tortoise and the hare. The tortoise won because he kept going and finished the race while the hare fooled around and did not focus on the race.

As your income increases so should your savings commitment. As your savings grows, there will come a time when the dividend income is larger than the money you add to the account every year from your salary.

If you begin later in life, you will have to save more to achieve the same result. You might have to work longer as well. But this approach will clearly ensure you are financially independent at some future point in your life.

Remember save 10%, don’t touch it, invest in blue chips only, diversify, reinvest the dividends and watch your savings grow!

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