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What it Means to be Disenfranchised

Disenfranchised people are those who feel deprived of a legal right or privilege. The number of people disenfranchised within the United States is part of the reason Donald Trump, a candidate without a history in politics, was elected to office. While much of the country is recovering from the Great Recession, there continues to be a lag for many disenfranchised Americans.1

For some, there’s a feeling that they can’t afford anything anymore. One poll found that a large swath of middle-class Americans long for quality jobs, affordable health care and child care and both economic and financial security.2

Over the past three decades, America’s economy has moved from manufacturing-based jobs to service-based jobs. This gradual process transformed the job market. Even with today’s low unemployment rate, there are jobs available, but in many cases, those who need the job may not have the skills and experience that the position requires or it may not pay the wages they are looking for.3

Americans dissatisfied with the health care initiatives introduced by Barack Obama reported a variety of motives for voting Trump. A common complaint was that premiums seemed to increase every year. Others went deeper, saying Trump’s proposals would promote personal responsibility rather than guarantee health care for those who are “lazy and entitled.” Sixty-six percent of Trump supporters said the economy is “rigged for people receiving government assistance.”4

The combination of expensive health care options, a difficult job market and overwhelming debt, and it’s easy to see why some have become so disenfranchised. How many Americans are we talking about?

Leading up to the election, a Gallup poll found only 27 percent were satisfied with the current state of the country.5 A post-election poll in December found a similar overall result, with Democrats still feeling slightly better than Republicans despite the presidential election results.6

Dissatisfaction can take on different forms. Many people have their concerns about the future of the country, but perhaps more importantly, are focused more on their own personal situation. The fact is, contentment has a lot to do with feeling confident, or at least hopeful, about your future.

One way to work toward this confidence is to insure a portion of your retirement assets. That’s where we come in. We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. Please contact us if you’d like to discuss ways to develop more confidence about your ability to provide income throughout retirement.

 

Content prepared by Kara Stefan Communications.

1 Bob Rapoza. The Hill. Dec. 9, 2016. “Rural America demands the nation’s attention.” http://thehill.com/blogs/pundits-blog/presidential-campaign/309735-rural-america-demands-the-nations-attention. Accessed Dec 9, 2016.

2 The Center for Retirement Research at Boston College. Nov. 15, 2016. “The Needs of Working Folks.” http://squaredawayblog.bc.edu/squared-away/the-needs-of-working-folks/. Accessed Dec 20, 2016.

3 Ibid.

4 Olga Khazan. The Atlantic. Dec. 20, 2016. “If Not Obamacare, Then What?”

https://www.theatlantic.com/health/archive/2016/12/if-not-obamacare-then-what/511130/. Accessed Dec 20, 2016.

5 Gallup. Oct. 13, 2016. “U.S. Satisfaction Remains Low Leading Up to Election.” http://www.gallup.com/poll/196388/satisfaction-remains-low-leading-election.aspx. Accessed Dec 20, 2016.

6 Clark Mindock. International Business Times. Dec. 16, 2016. “Are Americans Happy With The US? Election, Economy, Wars Have Most Dissatisfied, New Poll Finds.” http://www.ibtimes.com/are-americans-happy-us-election-economy-wars-have-most-dissatisfied-new-poll-finds-2461644. Accessed Dec 20, 2016.

 

This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.


The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

 

 

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Possible Perks and Perils of Buying Coastal Property

All over the world, from Miami to the Maldives, rising sea levels threaten coastal real estate.

Scientists say the daily high-water mark has been rising by nearly an inch a year in places like South Florida. During extraordinary high tides, saltwater even sneaks up the driveways of some multi-million dollar coastal homes.1 

While projections vary, the general consensus is that sea levels could rise by anywhere from 3 to 6.5 feet by the end of this century. 2 

Many people dream throughout their careers of owning a piece of real estate on the water, perhaps as a retirement first or second home. While oceanfront property demand remains strong and communities are still being developed, the potential effect of climate change is beginning to cast a shadow over this dream.3 

According to the federal government, eight out of 10 of the most expensive natural disasters in U.S. history were caused by hurricanes.4 For anyone intending to purchase property near the ocean, it’s an issue that should not be ignored. It’s a good idea to speak with an experienced property and casualty insurance agent to understand a homeowner’s responsibilities regarding coastal property. 

If your heart is set on the waterfront, a real estate agent with experience selling these types of properties can be helpful. Buying coastal properties requires a certain amount of due diligence. For example, it’s wise to find out:5 

·         The different types of mortgage loans and qualifying criteria, because a loan for waterfront properties can take a lot longer than a normal home loan

·         Whether the structure’s building materials are designed to withstand local weather conditions

·         What’s allowed and what permits are required for any improvements you may want to make, such as adding a deck, dock or boat lift

·         If all the utilities you expect are available, such as cable television, internet access and cellphone coverage 

Generally, mortgaged properties in flood zones require flood insurance sold by the federal government. While this insurance may be required to purchase the property, some homeowners later drop their policies. If you don’t have insurance and your house floods, the financial impact could be disastrous. Under some circumstances, the government may still offer assistance but it may not be nearly enough. For example, the average federal assistance in Florida is $4,000, compared to the average flood insurance payout of $51,000.6 

Another flood insurance tip: There’s generally a 30-day waiting period before coverage goes in force, so you may not want to wait until your local news starts tracking a storm to purchase flood insurance. 7 

Then again, coastal real estate can provide free housing for vacations as well as ongoing rental income. You should carefully consider whether you’re up for the task, which can include landlord duties, maintenance and upkeep, ongoing expenses and the inconvenience of an illiquid asset.8 

Content prepared by Kara Stefan Communications. 

1 Elizabeth Kolbert. The New Yorker. Dec. 28, 2015. “The Siege of Miami.” http://www.newyorker.com/magazine/2015/12/21/the-siege-of-miami. Accessed Dec 11, 2016.
2 Ibid.
3 Ian Urbina. The New York Times. Nov 24, 2016. “Perils of Climate Change Could Swamp Coastal Real Estate.” http://www.nytimes.com/2016/11/24/science/global-warming-coastal-real-estate.html?_r=0. Accessed Dec 11, 2016.
4 FloodSmart.gov. Sept. 27, 2016. “Tropical Storms and Hurricanes.” https://www.floodsmart.gov/floodsmart/pages/flooding_flood_risks/tropical_storms_hurricanes.jsp. Accessed Dec 11, 2016.
5 Shannon Petrie. HGTV. 2016. “Waterfront Buying: Top 10 Tips from Agents.” http://www.hgtv.com/design/real-estate/waterfront-buying-top-10-tips-from-agents. Accessed Dec 11, 2016.
6 Harold Bubil. The Herald Tribune. March 23, 2016. “Flood insurance is getting expensive, but can you afford to be without it?” http://realestate.heraldtribune.com/2016/03/23/flood-insurance-is-getting-expensive-but-can-you-afford-to-be-without-it/. Accessed Dec 11, 2016.
7 FloodSmart.gov. 2016. “Protect What Matters.” https://www.floodsmart.gov/floodsmart. Accessed Dec 11, 2016.
8 Bankrate.com. Aug. 2, 2016. “Funding retirement with rental income.” http://www.bankrate.com/finance/retirement/funding-retirement-with-rental-income-1.aspx. Accessed Dec 11, 2016. 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice. 

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference. 

 

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Tips for the Modern Traveler

Traditional vacation prep used to entail choosing a budget destination, buying some traveler’s checks and heading to the airport just in time for your flight. For many, that list of things to do has changed drastically. 

“Wellness travel” has become a big draw for vacationers who are willing to spend around 140 percent more than the average wanderer in pursuit of wellness opportunities. Wellness venues include treatment amenities ranging from spas, meditation, yoga, Pilates and kickboxing classes to personal nutrition and  detox programs.1 

If wellness is what you’re looking for, then prepare for some extra expense. One of the pitfalls of vacations is that we tend to overspend because, well, we’re on vacation. Before you even start shopping for airline tickets or hotel rates, it’s a good idea to establish a reasonable budget that you can afford to spend. 

Another thing you may want to consider is buying travel insurance, which about 30 percent of travelers now purchase. Policies range from minor to comprehensive “cancel for any reason” coverage. Remember that travel insurance is best purchased for large-ticket risks, so you don’t necessarily need to buy it for “nickel-and-dime” expenses. Keep in mind, the older you are, the more likely you may need medical care while on vacation.2 

Looking for the best credit card to use for traveling? If you’re going abroad, use one that doesn’t charge a foreign transaction fee. Many levy anywhere from 1 to 3 percent extra on every purchase — and that’s on top of any increases caused by currency conversion.3 Also, consider getting a credit card with the EU chip. 

It may also be a good idea to procure the local currency for your travel destination before you leave the U.S. You can order it through your bank and will likely get a better exchange rate than if you use other vendors once you’re abroad. Be aware, too, that the number of merchants that accept traveler’s checks is dwindling.4 

Another travel tip is to follow airline recommendations and arrive at the airport hours in advance to make it through security. This is especially important when the airport is busy. When it’s not, you’ve just got a lot of time on your hands and some uncomfortable seating. If you need some peace and quiet, find the airport chapel, or an airport museum or art gallery. Another way to break away from the crowds is to pay for a one-day pass into an exclusive airport VIP club.5 

When it comes to planning for a restful vacation, remember not to overbook activities so you get worn out, and that taking advantage of travel insurance, concierge recommendations at your destination and other available resources may help take some of the stress out of traveling. 

Content prepared by Kara Stefan Communications. 

1 Why Travel. Nov. 23, 2016. “10 Hotels Leading the Wellness Travel Space in 2017.” http://whytravel.us/news/10-hotels-leading-the-wellness-travel-space-in-2017.html. Accessed Dec 2, 2016.
2 Jeff Blyskal. Consumer Reports. Nov. 19, 2016. “Should You Buy Travel Insurance for the Holidays?” http://www.consumerreports.org/travel-insurance/should-you-buy-travel-insurance/. Accessed Dec 2, 2016.
3 The Flight Deal. Nov. 21, 2016. “How to Save Money Abroad with No Foreign Transaction Fee Credit Cards.” http://www.theflightdeal.com/2016/11/21/how-to-save-money-with-no-foreign-transaction-fee-credit-cards/. Accessed Dec 2, 2016.
4 Melissa Lambarena. Nerd Wallet. Mar. 9, 2016. “Where to Exchange Currency Without Paying Huge Fees.” https://www.nerdwallet.com/blog/banking/exchange-currency-paying-huge-fees/. Accessed Dec 2, 2016.
5 Rudy Maxa. Travel Channel. Dec. 1, 2016. “Layover Survival Guide.” http://www.travelchannel.com/interests/travel-tips/articles/layover-survival-guide. Accessed Dec 2, 2016. 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice. 

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference. 

 

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Looking Through the Glass Ceiling

The Women’s Rights Movement began in 1848 to enable women to have representation in decisions impacting their social, civil and religious rights.1 

While Hillary Clinton, the first female presidential candidate from a major party, was not elected this year, women take their right to vote very seriously. In every presidential election since 1964 (2016 results not yet available), the number of women who voted exceeded that of men.2 

Another area where women have made up ground, but are still working to pull even, is the wage difference between genders. This gap can also be a hindrance for women when it comes to saving for retirement. For example, while women are more likely than men to work for employers that offer retirement plans, far less are eligible to participate in those plans because they work part-time or for a shorter time span. As a result, nearly 12 percent of baby boomer women who have participated in the workforce end up retiring in poverty.3 

From paying bills to participating in large-scale financial decisions, it is important for women to take an active role in their own retirement planning. One thing to consider may be setting up separate retirement income streams for each spouse to ensure household income is not significantly reduced should one spouse die or become incapacitated. 

Self-employment is one area that might seem free of glass ceilings, but new research reveals a lack of capital funding available for women. Reasons cited for this include not having enough collateral necessary to secure a loan, gender discrimination or simply that women tend to be more risk averse when it comes to borrowing large sums of money.4

In a recent speech, Christine Lagarde, managing director of the International Monetary Fund, pointed out that if women participated in the U.S. labor force to the same extent as men, our national income could increase by 5 percent.5 

Lagarde also gave an example of women breaking the glass ceiling, but ultimately not achieving complete parity. Iceland elected its first female president back in 1980, but women’s wages there still trail men’s by 14 to 18 percent. Interestingly, Icelandic working women recently protested lower wages with a job walk-out at precisely 2:38 p.m. — the time of day when they stop being paid (relative to men’s pay).6 

The Women’s Rights Movement is now about 168 years old.According to the IMF, at the current rate of progression globally, women should achieve parity with men’s wages in another 170 years7 — so we’re almost halfway there. Baby steps. 

Content prepared by Kara Stefan Communications. 

1 Bonnie Eisenberg and Mary Ruthsdotter. National Women’s History Project. “History of the Women’s Rights Movement.” http://www.nwhp.org/resources/womens-rights-movement/history-of-the-womens-rights-movement/. Accessed Nov. 29, 2016.
2 Center for American Women and Politics. “Gender Differences in Voter Turnout.” http://www.cawp.rutgers.edu/sites/default/files/resources/genderdiff.pdf. Accessed Nov. 29, 2016.
3 Jennifer Erin Brown, Nari Rhee, Joelle Saad-Lessler and Diane Oakley. UC Berkeley Labor Center. March 1, 2016. “Shortchanged in Retirement: Continuing Challenges to Women’s Financial Future.” http://laborcenter.berkeley.edu/shortchanged-in-retirement-continuing-challenges-to-womens-financial-future/. Accessed Nov. 29, 2016.
4 Robert M. Sauer. World Economic Forum. Sept. 28, 2016. “The self-employed glass ceiling isn’t getting the attention it deserves.” https://www.weforum.org/agenda/2016/09/the-self-employed-glass-ceiling-isnt-getting-the-attention-it-deserves. Accessed Nov. 29, 2016.
5 Christine Lagarde. The International Monetary Fund. Nov. 14, 2016. “Women’s Empowerment: An Economic Game Changer.” https://www.imf.org/en/News/Articles/2016/11/14/SP111416-Womens-Empowerment-An-Economic-Game-Changer. Accessed Nov. 14, 2016.
6 Ibid.
7 Ibid. 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice. 

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference. 

 

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The State of Real Estate

Thanks to price and sales growth, the U.S. housing market outperformed the U.S. economy in the first six months of 2016. Part of that success is demographic driven: Older millennials are looking to grow their families and buy their first home at the same time that some baby boomers are downsizing in preparation for retirement.1

However, the market for existing homes is still struggling as a result of low inventory, which helps explain why 10 percent of homes sold this year are newly constructed, up 2 percent from a year ago.2

After mortgage rates remained relatively steady over the past few years, many projections expected a substantial increase in 2016. However, they remained in the 3 to 4 percent range for most of the year,3 and the number of home sales due to an inability to pay mortgages dropped to a nine-year low.4

Meanwhile, thanks in part to this low-rate environment, residential home prices reached an all-time high in the third quarter of 2016 — higher than even the pre-recession peak.5

Like so many areas of the economy, the housing market experienced a shakeup in the immediate aftermath of the election. There was a slight bump in the 30-year mortgage interest rate to 4 percent, a move that typically drives housing prices down.6 Given the dynamic between interest rates and housing prices, coupled with the fact that the President-elect is a real estate guru, it will be interesting to see how the housing market evolves under the new administration.

Recently, a couple of new studies revealed some other interesting trends in the housing market. One found that since 2012, homeowners without a college degree have seen the value of their homes appreciate by less than 0.2 percent, while college graduates have seen their home values soar by an average 10.8 percent.7

Women still have a more difficult time qualifying for a home mortgage and are more likely to pay a higher interest rate than men. However, one study found that women are less likely than men to default on their home loan.8

For retirees in the market for a property, be aware that a mortgage loan may be structured differently depending on if the property is considered a principal residence, a second home or an investment property.9


Content prepared by Kara Stefan Communications.

1 National Association of Realtors. Nov. 10, 2016. “Expect Busier Months Ahead.” http://realtormag.realtor.org/daily-news/2016/11/10/expect-busier-months-ahead#sf41976874. Accessed Nov. 14, 2016.

2 Ibid.

3 The Mortgage Reports. Nov. 1, 2016. “November 2016 Mortgage Rates Forecast.” http://themortgagereports.com/22963/november-2016-mortgage-rates-forecast-fha-va-conventional-loans. Accessed Nov. 12, 2016.

4 Kelsey Ramirez. Housing Wire. Nov. 3, 2016. “Median home prices finally pass housing boom levels, hit all-time high.” http://www.housingwire.com/articles/38436-median-home-prices-finally-pass-housing-boom-levels-hits-all-time-high. Accessed Nov. 12, 2016.

5 Ibid.

6 Diana Olick. CNBC. Nov. 14, 2016. “Panic in housing market as Trump effect pushes mortgage rates to 4%.” http://www.cnbc.com/2016/11/14/trump-effect-pushes-mortgage-rates-to-4.html. Accessed Nov. 12, 2016.

7 The Economist. Nov. 12, 2016. “To those that have.” http://www.economist.com/news/finance-and-economics/21709974-prices-are-diverging-geographic-social-and-ethnic-lines-those-have?fsrc=scn/tw/te/bl/ed/housinginamerica2tothosethathave. Accessed Nov. 14, 2016.

8 Knowledge@Wharton. Oct. 12, 2016. “Why Women Pay More for Mortgages.” http://knowledge.wharton.upenn.edu/article/why-women-pay-more-for-mortgages/. Accessed Nov. 12, 2016.

9 Scott Sheldon. Credit.com. Jul. 22, 2015. “The Surprising Way Your Job Can Impact Your Mortgage.” http://blog.credit.com/2015/07/the-surprising-way-your-job-can-impact-your-mortgage-121451/. Accessed Nov. 14, 2016.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

 

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

 

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The 60-Year Career

Now that people are living longer, many are also working longer. Just imagine, if you start working regularly at age 20 and don’t retire until age 80, that’s a 60-year career. While it’s not as common today, traditionally, many workers would spend their entire career working for the same employer

Take, for example, 86-year-old Detroit native Angelo Fracassa. He retired this year after working for the IRS for 60 years. He has an accounting degree, an MBA and was responsible for bringing new computer technology on board about the time most of his peers were retiring.1

Today, however, more workers are reinventing themselves and purposely pursuing different types of careers all in one lifetime. Retiree Bob White is one of them. He went from a stint in the Air Force to meteorologist to ordained minister to self-published novelist.2

After spending decades at an office job, some people enjoy the transition to a freelance career. There are plenty of options that allow you to put your skills to use, plus you can work from home with low overhead and lots of flexibility. One of the biggest challenges to starting out may be marketing yourself to find clients. For example, it can take a year or more to get a freelance writing business going.3

Fortunately, opportunities in the job market have grown for baby boomers who want to keep working toward a 60-year career.4 Whatever your career ambitions, it’s a good idea to evaluate your finances before making a career change. Sometimes it can be a challenge to bridge your income between the end of one regular paycheck and the beginning of another.5

As a financial professional, I can take a look at your individual situation and make recommendations on ways to generate income during this phase of your life through the use of insurance products.

A recent survey found that some of the wealthiest pre-retirees are more willing to work longer — not necessarily for the money, but for the intellectual challenge and a chance to stay physically and socially active. However, most want to change the way they work: About a third said they would prefer to work just part-time, while another third said they would like to transition in and out of the workforce, taking vacations or simply spending extended leisure time at home before heading back for another stint in the office.6

Content prepared by Kara Stefan Communications.

1 Jim Schaefer. Detroit Free Press. Feb. 23, 2016. “A few minutes with … a man who worked for 60 years.” http://www.freep.com/story/news/columnists/jim-schaefer/2016/02/20/few-minutes-man-who-worked-60-years/80659270/. Accessed Nov. 7, 2016.

2 Nadine Cheung. The Huffington Post. Sept. 23, 2015. “Retired Senior Finds New Career As A Novelist.” http://www.huffingtonpost.com/2015/09/23/bob-white-retired-novelist_n_8185188.html. Accessed Nov. 7, 2016. 

3 Jeb Harrison. The Huffington Post. May 18, 2016. “Freelancing Through Our Golden Years.” http://www.huffingtonpost.com/jeb-harrison/freelancing-through-our-g_b_10026190.html. Accessed Nov. 7, 2016.  

4 New Retirement. June 14, 2016. “Jobs for Seniors: What Are the Best Jobs After Retirement?” https://www.newretirement.com/retirement/jobs-for-seniors-best-jobs-after-retirement/. Accessed Nov. 7, 2016. 

5 Nanci Hellmich. USA Today. March 19, 2014. “Building a successful 2nd career near retirement.” http://www.usatoday.com/story/money/personalfinance/2014/03/19/successful-second-act/6022803/. Accessed Nov. 7, 2016. 

6 Dorie Clark. Harvard Business Review. April 28, 2016. “Planning Your Post-Retirement Career.” https://hbr.org/2016/04/planning-your-post-retirement-career. Accessed Nov. 7, 2016.

This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice. 

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference. 

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The 60-Year Career

Now that people are living longer, many are also working longer. Just imagine, if you start working regularly at age 20 and don’t retire until age 80, that’s a 60-year career. While it’s not as common today, traditionally, many workers would spend their entire career working for the same employer

Take, for example, 86-year-old Detroit native Angelo Fracassa. He retired this year after working for the IRS for 60 years. He has an accounting degree, an MBA and was responsible for bringing new computer technology on board about the time most of his peers were retiring.1

Today, however, more workers are reinventing themselves and purposely pursuing different types of careers all in one lifetime. Retiree Bob White is one of them. He went from a stint in the Air Force to meteorologist to ordained minister to self-published novelist.2

After spending decades at an office job, some people enjoy the transition to a freelance career. There are plenty of options that allow you to put your skills to use, plus you can work from home with low overhead and lots of flexibility. One of the biggest challenges to starting out may be marketing yourself to find clients. For example, it can take a year or more to get a freelance writing business going.3

Fortunately, opportunities in the job market have grown for baby boomers who want to keep working toward a 60-year career.4 Whatever your career ambitions, it’s a good idea to evaluate your finances before making a career change. Sometimes it can be a challenge to bridge your income between the end of one regular paycheck and the beginning of another.5

As a financial professional, I can take a look at your individual situation and make recommendations on ways to generate income during this phase of your life through the use of insurance products.

A recent survey found that some of the wealthiest pre-retirees are more willing to work longer — not necessarily for the money, but for the intellectual challenge and a chance to stay physically and socially active. However, most want to change the way they work: About a third said they would prefer to work just part-time, while another third said they would like to transition in and out of the workforce, taking vacations or simply spending extended leisure time at home before heading back for another stint in the office.6

Content prepared by Kara Stefan Communications.

1 Jim Schaefer. Detroit Free Press. Feb. 23, 2016. “A few minutes with … a man who worked for 60 years.” http://www.freep.com/story/news/columnists/jim-schaefer/2016/02/20/few-minutes-man-who-worked-60-years/80659270/. Accessed Nov. 7, 2016.

2 Nadine Cheung. The Huffington Post. Sept. 23, 2015. “Retired Senior Finds New Career As A Novelist.” http://www.huffingtonpost.com/2015/09/23/bob-white-retired-novelist_n_8185188.html. Accessed Nov. 7, 2016. 

3 Jeb Harrison. The Huffington Post. May 18, 2016. “Freelancing Through Our Golden Years.” http://www.huffingtonpost.com/jeb-harrison/freelancing-through-our-g_b_10026190.html. Accessed Nov. 7, 2016.  

4 New Retirement. June 14, 2016. “Jobs for Seniors: What Are the Best Jobs After Retirement?” https://www.newretirement.com/retirement/jobs-for-seniors-best-jobs-after-retirement/. Accessed Nov. 7, 2016. 

5 Nanci Hellmich. USA Today. March 19, 2014. “Building a successful 2nd career near retirement.” http://www.usatoday.com/story/money/personalfinance/2014/03/19/successful-second-act/6022803/. Accessed Nov. 7, 2016. 

6 Dorie Clark. Harvard Business Review. April 28, 2016. “Planning Your Post-Retirement Career.” https://hbr.org/2016/04/planning-your-post-retirement-career. Accessed Nov. 7, 2016.

This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice. 

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference. 

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Taxing Questions

At the end of October, the IRS made several announcements regarding taxes in 2017. 

Information available for the new year now includes tax rates, standard deductions, exemption amounts and more. While the standard deduction for various filing groups is set to increase by $50 or $100, an additional standard deduction of $1,250 is available for seniors (or the blind); $1,550 if the individual is also unmarried and not a surviving spouse.1 

It’s a little late in the year to be changing tax laws for 2017, but there was one instance in 1993 under Bill Clinton’s administration when a tax law went into effect retroactive to the beginning of the year in which it was passed.2 

There’s always plenty to think about at the end of the year, but don’t overlook opportunities to prepare for next year’s tax return in December, such as making charitable donations or maxing out contributions to your retirement accounts.3

Before Congress looks ahead to 2017, it still has tax issues to be dealt with by the end of this year. Common tax breaks set to expire at the end of 2016 pertain to mortgage insurance premiums, medical expense deductions and tuition deductions. It’s possible for tax breaks to be extended now that election season has ended, but there are no guarantees.4 

One thing both presidential candidates agreed on was the need for tax reform. The Brookings Institution5 and the Tax Foundation6 offer detailed views of several tax policy options that could be up for debate next year, along with their potential impacts. 

Neither our firm nor its agents or representatives may give tax advice. We recommend you consult an experienced tax advisor regarding your personal circumstances. Please feel free to contact us to discuss creating retirement strategies through the use of insurance products that can help you work toward your long-term retirement income goals. 

Content prepared by Kara Stefan Communications. 

1 Kelly Phillips Erb. Forbes. Oct. 25, 2016. “IRS Announces 2017 Tax Rates, Standard Deductions, Exemption Amounts and More.” http://www.forbes.com/sites/kellyphillipserb/2016/10/25/irs-announces-2017-tax-rates-standard-deductions-exemption-amounts-and-more/#689a9df0387a. Accessed Oct 28, 2016.
2 Ben Steverman. Financial Planning. Oct. 26, 2016. “The rich get ready for higher taxes under a President Clinton.” http://www.financial-planning.com/news/the-rich-get-ready-for-higher-taxes-under-a-president-clinton. Accessed Oct 28, 2016.
3 Sarah O’Brien. CNBC. Oct. 3, 2016. “Seriously: ‘Tis the season to think about tax strategies.” http://www.cnbc.com/2016/10/03/seriously-tis-the-season-to-think-about-tax-strategies.html. Accessed Oct 28, 2016.
4 Janet Berry-Johnson. Forbes. Sept. 26, 2016. “Popular Tax Breaks Expiring At The End of 2016.” http://www.forbes.com/sites/janetberryjohnson/2016/09/26/popular-tax-breaks-expiring-at-the-end-of-2016/#5193574f50ef. Accessed Nov. 11, 2016.
5 William G. Gale and Aaron Krupkin. The Brookings Institution. Oct. 6, 2016. “Tax reform needed now!” https://www.brookings.edu/research/tax-reform-needed-now/. Accessed Oct 28, 2016.
6 Kyle Pomerleau. Tax Foundation. July 25, 2016. “Details and Analysis of the 2016 House Republican Tax Reform Plan.” http://taxfoundation.org/article/details-and-analysis-2016-house-republican-tax-reform-plan. Accessed Oct 28, 2016. 

This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice. 

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference. 

 

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Get in the Entrepreneurial Spirit

Whether you want a little extra income or just want to get out and interact with new people, tapping into your entrepreneurial instincts can fill many needs in retirement. Here are a few examples of fun, money-generating ideas people have come up with recently. 

Remember photo booths — a printed strip of quick takes for a buck? These have regained popularity as a must-have activity at many weddings. One woman capitalized on the demand by purchasing a photo booth and pitching it for local wedding receptions. The side gig now generates a six-figure revenue.1 

It’s a good reminder that being an entrepreneur doesn’t necessarily mean coming up with a brand new product. You can also use your own talents to do something you enjoy and get paid for it. Mega-entrepreneur Martha Stewart said she’s seen a trend in product makers expressing their own spirit, with less focus on what the market wants. For example, if you sew aprons, add special, personalized messages on the front to make them unique.2 

Another idea is to create a business that charges less for things people need. For example, if you and your neighbors believe your city or county charges too much to pick up curbside garbage, invest in a truck and do it yourself for less.3 Advertise that you’ll retrieve and return trash cans to the backyard and still charge less than the city. 

Perhaps you enjoy cooking for large groups, but your family has spread out across the country. If that’s the case, consider cooking for someone else’s family. Today’s two-income families rely heavily on the fast-food industry to get meals on the table. Introduce a menu of your favorite meals to cook — including baked goods, desserts and ideas for special occasions — and distribute it among neighbors and friends.4 

Last year, just over 24 percent of new entrepreneurs were between the ages of 55 and 64.5 Remember, you have the advantage of knowing who you are, what you’re good at and, perhaps more importantly, what you’re not. If you can take your talents and knowledge to the masses, or even just your friends and their busy families, it could be a satisfying way to stay engaged in the community and supplement your income. 

Content prepared by Kara Stefan Communications. 

1 Elaine Pofeldt. Forbes. Oct. 24, 2016. “Why Small Business Ownership Will Skyrocket In 10 Years – Especially By Solopreneurs.” http://www.forbes.com/sites/elainepofeldt/2016/10/24/why-small-business-ownership-will-skyrocket-in-10-years-especially-by-solopreneurs/#35addb527725. Accessed Oct. 24, 2016.
2 Lydia Belanger. Entrepreneur. Oct. 24, 2016. “Martha Stewart: The World Wants Your Unique Product. You Just Need to Find the Right Partners.” https://www.entrepreneur.com/article/284213. Accessed Oct 24, 2016.
3 Richard Eisenberg. Forbes. July 7, 2016. “What It Takes to Be a Successful 50+ Business Owner.” http://www.forbes.com/sites/nextavenue/2016/07/07/what-it-takes-to-be-a-successful-50-business-owner/#3961408e3152. Accessed Oct 24, 2016.
4 Gayle Guyardo. WFLA. Jan. 13, 2016. “Busy Tampa families use local services to get home-cooked meals.” http://wfla.com/2016/01/13/busy-tampa-families-use-local-services-to-get-home-cooked-meals/. Accessed Oct 24, 2016.
5 Elizabeth Walsh. The New York Times. Sept. 9, 2016. “Older Entrepreneurs Take On the ‘Concrete Ceiling.'” http://www.nytimes.com/2016/09/10/your-money/older-entrepreneurs-take-on-the-concrete-ceiling.html?_r=0ets. Accessed Oct 24, 2016. 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice. 

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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Drug Prices: The Power of a Celebrity Tweet

When drug manufacturer Mylan increased the list price of EpiPen last summer, it suffered the wrath of celebrity backlash. Actress Sarah Jessica Parker publicly criticized the company for raising the price of its emergency allergy treatment to $608.1 

EpiPen, which has been around for decades, cost less than $100 when Mylan originally acquired the product in 2007. The company declined to comment on the price hike, but cited high-deductible health plans as a reason consumers now pay so much out-of-pocket for drugs.2 

If you think health care expenses are high now, imagine what they could be if they continue on this trajectory. One recent study asserted that, because health care inflation is dramatically higher than regular inflation, someone who retires this year may encounter $33,000 or more in total health care expenses during retirement than someone who retired in 2015.3 

When planning for retirement, it’s important to factor in the potential increase of medical costs and other expenses, in addition to possible reduced expenses,  such as mortgage payments and work commuting. We can help you create a retirement income strategy through the use of insurance products that you can feel confident about. 

While increasing pharmaceutical prices aren’t a new controversy, Parker’s celebrity status may have helped bring the issue into mainstream discussion. She posted on Instagram that she would no longer purchase the company’s products, urging them to “lower the cost to be more affordable for whom it is a life-saving necessity.”4 

The new-found spotlight on drug prices has generated some pretty interesting revelations about the industry. For example, because the process for developing new drugs and getting them approved by the FDA is so costly and time-consuming, some drug makers routinely look at their product line to see which ones are in a market that will tolerate a substantial price increase.5 

Unfortunately, one of those markets is “orphan drugs.” “Orphan drug” is the category name of medications developed for rare diseases, specifically those that affect fewer than 200,000 people. Because of the smaller market, these drugs tend to be quite expensive. In fact, legislation passed in 1983 was designed to encourage drug makers to develop treatments for such rare diseases. However, the market has become so lucrative that it threatens to increase insurance premiums for the broader population.6 

Regardless of what happens in the drug industry, what is important is how each of us can prepare for health care expenses and take advantage of cost-reduction strategies where available. To this end, the following are some basic tips to consider when a prescription drug is necessary:7 

  • Ask for a generic drug when prescribed a name brand drug
  • Ask your physician if there is a single medication that can address ailments for which you take multiple pills
  • Before you get your prescription filled, check with your insurance to see where the drug lies in your plan’s drug formulary. If it’s in a higher tier, print out the formulary and show it to your physician to see if there’s a lower-tier option that would work as well. Your pharmacist, in consultation with your doctor, may be able to help with this as well.
  • Use a mail-order plan for common maintenance medications
  • Make sure the pharmacy you go to is within your plan’s network
  • Check the drug manufacturer’s website for discount coupons 

 

Content prepared by Kara Stefan Communications. 

1 CBS News. Aug. 26, 2016. “Sarah Jessica Parker cuts ties with EpiPen over price hikes.” http://www.cbsnews.com/news/sarah-jessica-parker-cuts-ties-with-epipen-over-price-hikes/. Accessed Oct. 3, 2016.
2 Tara Parker-Poe and Rachel Rabkin Peachman. The New York Times. Aug. 22, 2016. “EpiPen Price Rise Sparks Concern for Allergy Sufferers.” http://well.blogs.nytimes.com/2016/08/22/epipen-price-rise-sparks-concern-for-allergy-sufferers/?_r=0. Accessed Oct. 8, 2016.
3 HealthView Services. Sept. 21, 2016. “HealthView Services: 2016 Retirement Health Care Costs Data Report.” http://www.hvsfinancial.com/PublicFiles/2016_RHCC_Data_Report.pdf. Accessed Oct. 3, 2016.
4 CBS News. Aug. 26, 2016. “Sarah Jessica Parker cuts ties with EpiPen over price hikes.” http://www.cbsnews.com/news/sarah-jessica-parker-cuts-ties-with-epipen-over-price-hikes/. Accessed Oct. 3, 2016.
5 Knowledge@Wharton. Aug. 26, 2016. “Will Mylan’s EpiPen Episode Help Curb Pharmaceutical Price Gouging?” http://knowledge.wharton.upenn.edu/article/why-competition-failed-to-regulate-the-cost-of-epipen/. Accessed Oct. 10, 2016.
6 Carolyn Y. Johnson. The Washington Post. Aug. 4, 2016. “High prices make once-neglected ‘orphan’ drugs a booming business.” https://www.washingtonpost.com/business/economy/high-prices-make-once-neglected-orphan-drugs-a-booming-business/2016/08/04/539d0968-1e10-11e6-9c81-4be1c14fb8c8_story.html. Accessed Oct. 13, 2016.
7 Kara Brandeisky. Time. Feb. 29, 2016. “13 Smart Ways to Save on Prescription Drugs.” http://time.com/money/4229587/save-money-prescription-drug-costs/. Accessed Oct. 13, 2016. 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice. 

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference. 

 

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