Downsizing When You Retire? Hold on! Some Seniors Are Upsizing!

Expanding Family Home

A recent study by Merrill Lynch discovered that although half of the retirees queried downsized to smaller livings quarters, 30 per cent moved into larger homes.

The chief reason was to plan for the possibility of accommodating visits from family or friends. It also is to allow that family members might want to return to the nest after all.

Many boomers and seasoned seniors are finding their off spring have a need to return home after getting a taste of the wide world out there.

These young people are called “helicopter kids.” They hover around Mom and Dad to return to their comfort zone when unemployment, relationships and economic hardship sour in the outside world. Of course, another reason to return home may be nothing more than missing Mom’s home cooking.

In 2014, for the first time in more than 130 years, adults ages 18 to 34 were slightly more likely to be living in their parents’ home than they were living with a spouse or partner in their own household, according to Pew Research.

Another changeable element in American society is for some couples seeking more home space for their parents. People are living longer and there are multiple reasons (health issues, death of one spouse, insufficient living expenses, etc.) for moving in an aging parent(s).

This is occurring more frequently. In 2008, 4.05 million parents were living with an adult child. By the end of 2011, the number had risen to 4.6 million — a 13.7 percent increase.

Even among the tradition downsizers, the trend is changing; the National Association of Realtors reports that in 2004, boomers downsized by 500 square feet, on the average. In 2016, they decreased house size by only 100 square feet.

All in all, more boomers and seasoned seniors are going to find themselves a member of the “Sandwich Generation.“ No, it’s not a secret sect with mass appreciation for bologna and mayo. It’s the large number of boomers who find themselves simultaneous moving toward retirement and also taking care of aging parents or children or both. The boomers are in between; hence, the sandwich analogy.

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Doctors Finally Own Up to It: “Drugs Can’t Fix LOWER BACK PAIN!”

Acute backache, pain area of red color

Oh my aching back! Too often at the first flinch of pain, you trot to the medicine cabinet and swallow a couple of Advil or Tylenol. Worst yet, you might take an opioid: Oxycodone or Fentanyl.

You should know before you begin the pill for pain ritual that the American College of Physicians (ACP) now has new guidelines recommending alternative therapies instead of pain meds for lower back pain.

The ACP (148,000 members) has finally admitted it: their chief tool to treat one of America’s most common aliments doesn’t work.

New ACP guidelines released this month suggested doctors recommend exercise and treatments like heat wraps, yoga, and mindfulness meditation to their patients before proscribing medications like over the counter painkillers or opioids.

You say you don’t have lower back pain? Congratulations! You’re the exception.

Low back pain is one of the top reasons people see their doctors and this nuisance aliment is the number one reason for missing work throughout the world.

Here’s the capper. Lower back pain is incredibly common-yet doctors don’t really know what causes it.

The kind of low back pain we are talking about has no detectable cause, unlike a tumor, pinched nerve or a fracture. It can be acute (last four weeks), sub acute (last four to six weeks) or chronic (12 or more weeks). Rarely, though, is it a sign of a more serious problem.

Doctors pencil it in as “nonspecific low back pain.”

There is no silver bullet but there are treatments that can reduce the pain. A major suggestion you should be doing anyway: exercising moderately without breaking your back (pun). Exercising, perhaps, is the best alternative to drugs.

It’s a given that obesity, smoking, depression and anxiety all have been linked with lower back pain. What’s the cure? Replacing prescription drugs in addition to exercise and heat therapy reveals a myriad of other suggestions:

Heat therapy is a good line of defense for acute or sub acute low back pain. This alternative strategy can be followed by massage, acupuncture, and spinal manipulation by a chiropractor may help.

For chronic back pain, exercise, rehabilitation therapy, acupuncture and mindfulness-based stress reduction can be utilized.

Other non-drug therapy can be tai chi, yoga, low-level laser therapy, cognitive behavioral therapy and spinal manipulation. It should be stressed that none of the previous suggestion therapies have been proven to be complete solutions for lower back pain.

Therefore, if these non-drug therapies do not provide relief, then the physician and patient consider treatment with NSAIDs as a first line therapy. Consider Tramadol or Duloxetine as second line therapy.

Physicians should consider opioids as a last option for treatment and only for patients who have failed other therapies. Opioids are associated with substantial harm including the risk of addiction or accidental overdose.

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Discard old investing methods and go after the best new ways to build wealth

Letterpress Risk

Don Wilkinson, co-author of Rollover( http://www.rolloverretirmentwealth.com)

What’s hot and what’s not. Like most things, building wealth for your retirement is ever changing. That’s not to say the old ways never worked, but today, there are better methods and strategies to expand your wealth.

Take the traditional buy and hold portfolio theory. It’s outdated. Remember 2008? That rollercoaster market is history now, but if you rode it out, you could have lost as much as 40 percent of your portfolio. There’s a better way to handle your retirement account today. Read on.

Mutual funds are but another financial vehicle that, year after year, have been a gross injustice for most investors. When you examine the fact that more than 90 percent of mutual funds have underperformed the stock market as a whole for the past five years, it’s a no-brainer.

In spite of the millions spent on marketing hype by funds companies and brokerages trying to convince you that selling mutual funds is the best way to build wealth, it isn’t necessarily so. There are much better returns-generating vehicles that are more secure, more transparent financial strategies like Exchange Traded Funds (ETFs), and Unified Managed Accounts (UMAs) that put the genie in your corner and more dollars in your pocket.

Let’s look at some more examples:

Old way: Commissions on every transaction by brokers leaving you wondering where your money was going and why?

New way: Fee-based management. Clients pay one flat fee for all services rendered, based on the value of their portfolio to the advisor, rather than a broker. The fee-based system gives the incentive for the advisor to increase the value of your portfolio. The advisor makes money; you make money. Makes sense doesn’t it?

While we’re talking about those fees laid on by the fund companies, the old way was a complete lack of transparency. Anything more than paying for services was all the investment companies wanted the investors to know.

New Way: Today, complete transparency is available to every investor. They have complete access to their portfolio, and are even able to track buys and sells by money managers on a real time basis. Insist on full transparency. It’s another new way for you to discard the old and get onboard with the new way of doing business.

New Way: Nowhere in financial management is the shift from the old to the new more critical than in the area of asset allocation. How critical is it? Asset allocation, market timing, and security selection were tested for the variability of returns by researchers. It was found that over time, asset allocation decisions are more important than the other factors in determining how a portfolio performs.

If that’s true, the mix of stocks, bonds, cash in asset classes, and how your assets are positioned are key in determining if your portfolio is “strategic” or “tactical”.

Strategic asset allocation is an asset management strategy based on portfolio theory. As you know, when a portfolio is set up, a base policy mix is selected based on projected returns and risk tolerance of the client. Then as time goes by, the original mixes are rebalanced yearly or quarterly to maintain the long-term financial goals of the client. This is basic buy and hold, but with rebalancing — this method is utilized by Warren Buffett.

However, this tried and true strategy offers promise of more stability while still maintaining a strategic outlook for the individual investor. This is utilizing a tactical approach to move among various asset classes to take advantage of short and intermediate market inefficiencies to increase returns. Our asset of choice is ETFs.

Tactical money managers (TMMs) use a systematic process to evaluate different asset classes on a short timeline basis. They take advantage of favorable investment valuations. This is the way they work. For many reasons, good investments will often become undervalued. This undervaluation may be the result of economic forces, lack of investor confidence, or any number of the other factors. However, when circumstances change and the factors that caused the undervaluation disappear, the investments’ price will rise to more favorable levels. Hence, the investor’s returns will be improved.

Thus, this strategy allows the TMM to create extra value by taking advantage of certain situations in the marketplace. It’s a moderately active strategy since the TMM(s) returns to the portfolio’s original strategic assets then move elsewhere when desired short-term profits are achieved. This is sometimes called an opportunistic approach.

So, just as believers in modern portfolio theory accept that investors should diversify across asset classes, we believe too the investor should also diversify across asset classes. However, the new way is to diversify further. Use a given percentage of your wealth to hire a TMM upon advice of your advisor to take advantage of the rise and fall of a cantankerous market (i.e., 2008 and early 2009, 2010, 2011, etc) to boost returns on a tactical basis.

This means tactical money management can work in tandem with strategic allocation to provide diversification on an increased dimension. Thus, the investor can be provided with the opportunity for better returns while reducing risk, if you have both strategies within the same portfolio.

Thus, you have positioned yourself strategically (long-term investments with periodic rebalancing) and tactically (short-term inclusions in the market) when conditions dictate trades in undervalued market opportunities.

Now, let’s talk about the financial structure you should implement to gain the most returns on their wealth and reach the best comfort level with your risk adverse strategy. Certainly, we don’t advise purchasing buy and hold mutual funds, which historically have dealt investors’ high capital gains taxes, lackluster return, lack of transparency and high/hidden fees.

The best new strategy to come along lately for the astute investor is the Unified Managed Account (UMA). Just like separate managed account (SMA), the UMA rewards the client with asset customization, professional money management and, most important, reduced tax liability.

Both SMAs and UMAs are asset management portfolio strategies managed by independent money managers under an asset based fee structure called a platform.

The UMA structure is simpler. It provides comprehensive asset management in a single account. It removes the need for multiple accounts and combines all the assets into one. Best of all, the UMA can also include most other alternative asset management vehicles (i.e. stocks, bonds, and ETFs). Again, the portfolio is arranged purely as one single account — with full transparency under a fee management system. Retiring baby boomers are looking for simplicity.

Thus the UMA approach using separate account managers and ETFs with access to both strategic and tactical models is the way to go for the future. Sure beats the old way!

Words 1106/15 min reading time….go to blog: http://www.make-readyretirement.com

 

Want To Live To 100? Here’s How…

I’m not talking about wasting away your most senior years in a nursing home but keeping strong , mobile, and energized to keep rolling along during your advanced years.

It can be that way if you adjust your lifestyle in some of the ways others do on this good earth who are living longer and healthier.

So why not? Look at people living well as centenarians. This just means adjusting your lifestyle doing what they do.

Let’s look how the oldest people achieve longevity and avoid the weakness and fragility that so often comes with aging. Researchers have been studying specific elderly groups of people in different parts of the world for decades.

Places like Okinawa, Japan; the Barbagia region of Sardinia, Italy; a Seventh-Day Adventist community in Loma Linda, Calif.; and the Nicoya Peninsula in Costa Rica. There are other places as well.

All the folks who live in these places live longer than in other locations. Why?

Take Okinawa, for instance, which the Japanese call “The Land of the Immortals.” These Okinawans have one of the longest average life expectancies in the world. Men live an average of 78 years and women 86 years.

The also have the longest spans without disability—on average 72.3 years for men and 77.7 for years for women.

Most important, these Okinawns have one-fifth the rate of heart disease, one-forth the rate of breast and prostate cancer and one-third the rate of dementia. They also suffer fewer strokes.

What’s the secret? These people grow their own gardens of fruits and vegetables—year around because of the mild climate. They eat fresh produce with every meal.

They also eat very little meat and small quantities of fish

They use turmeric (a powerful antioxidant) in their cooking which includes garlic, onions, peppers, and tomatoes.

Living longer is also noted on our own shores with the Seventh-Day Adventist community in California.

These people no only avoid meat, but all sources of caffeine, alcohol and stimulant spices. They also eat many vegetables and nuts of various kinds.

Consequently, studies of this population have revealed a very low incidence of all cancers, less heart disease and lower rates of diabetes.

Longevity is not only about the food these groups consume. These people thrive on strong social ties from family and community groups. Sociability is evident among all long living groups around the world.

So in addition to diet, social contacts, —often a lifetime of hard physical labor contributes of the longevity of these people.

In fact, for the Okinawans, there’s not a word for “retire”. These people continue to work until they are no longer able.

Moderate exercise is essential to prevent hip fractures and crippling leg weakness that is common among the inactive elderly in our society.

Moderate exercise that includes walking, bike riding, swimming and also weight training and resistance exercises can prevent osteoporosis and fractures so common among seniors in our society.

One overlooked factor to live longer is sweating. With AC in our homes and cars in our society, most people literally have to go out of their way to sweat. Yet, sweating removes poisons like mercury from our bodies. People living in the high zones of longevity are accustomed to sweating.

Another way to preserve your life longer is drinking plenty of water. Many people are dehydrated daily and don’t even realize it. A recent study found that if a man drinks 5 to 6 glasses of water a day it reduces his risk of a fatal heart attack by 60 to 70 percent.

Finally, the mental factor in aging has to be recognized as discovered in these global areas of long-livers.

People in our society work themselves to death persuading fame, wealth, social position, and power. One aspect many miss on the way up is happiness. Researchers have found critical factors like a religious faith, strong family bonds, close social relationships, a special time to rest daily and having a purpose in life are most important.

Many people have spent a lifetime doing damage to their bodies and their self-contentment. Some of these blog suggestions here can make a big difference in your health and longevity. It’s never too late to begin your healthiest lifestyle possible.

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“Phased Retirement:” A Better Option for Your Golden Years?

Don Wilkinson, co author of ROLLOVER. link to http://www.rolloverretirementwealth.com

Golden nest eggWebster’s Dictionary is always searching America’s lexicon landscape for words or phases that are becoming popular on their way to becoming permanent. “Phased Retirement” is a term we have seen with more and more usage in recent years brought on by many factors such as a up and down economy, longer life spans and the baby boomer generation rewriting the book on retirement.

Phased retirement is a catch all term for retiring by gradually decreasing work time instead of abruptly upon reaching retirement age moving to Florida to be full time on the golf course. Your decision to phase in retirement can be on your own terms or by necessity. That is, more and more retirement age people find themselves in a no choice situation to keep working because simply they can’t afford to retire as soon as they’d hoped.

Others don’t wish to clock from 95 mph to zero in one stop. They want to gradually move into full time retirement by continuing to work part-time, do volunteer work or tackle hobbies left on the shelve during their full-time working years. Either way, if you’re considering a phased retirement you should be ready for some very different financial challenges that usually do not occur with the traditional retirement process.

Sure, the prime financial benefit of a phased retirement is that you will continue to get a paycheck, which may lessen the need to draw on your retirement savings, allowing your money to grow further.

Conversely, when you reduce work hours and salary, it could have a direct impact on your benefits at your company.

Here’s a few considerations:
• Life insurance: May be tied to a multiple of your salary
• Long-term disability insurance: Determine what affect is has if you continue working with this form of insurance
• Company health insurance: Check your company health coverage to see if reducing work hours will affect eligibility.
• Social Security: Phased in retirement could reduce benefits if you begin to collect SS before reaching retirement age and continue to work. (Each year before full retirement age is reached, the SS benefit will be reduced by $1 for every $2 you earn over a set limit, which is $14,160 for this year.
• Pension and other retirement benefits: This is a critical area. You could be vulnerable if your company doesn’t subscribe to letting employees receive pension benefits earlier. NOTE: Federal law allows workers to take pension benefits at age 62.

Typically, pensions are formulated by an employee’s service years and salary during the final days of his/her last days of employment. You can see, by phasing in retirement, the lower salary could reduce earning additional pension benefits. It’s important to check this out with your place of employment.

What about your 401(k)? Will you still be able to participate if working hours are reduced to part-time?

You might have to be creative in long term prospects of you considering both the extra income you would be receiving as a part-time working employee either at the original company or something unrelated and the long term effects on your pension and other savings programs. Using your savings funds to increase your assets value in separate accounts or annuities might be good options as you age.

As more and more companies consider the value of phased retirement, restrictions will undoubtedly loosen up. After all, not only does this reduce the compensation packages of long-term employees but also company sponsored phased retirement programs can be used to retain skilled older employees who would otherwise retire (especially in sectors where there is a shortage of entry-level job applicants). This can reduce labor costs or arrange training of replacement employees by older workers. While currently only 5 percent of midsize and large companies offer a formal phased retirement program, nearly 60 percent expect to develop one in the next five years, according to a recent survey by Hewitt Associates.

A growing consensus exists that the nature of retirement is changing. No longer do most workers wish to experience a sudden end to work, followed by an equally sudden onset of full-time retirement. Instead, many workers wish to ease in to retirement, transitioning out of the workforce with a reduced workload.

My advice is to be alert to this accelerated trend of phased retirement and develop asset strategies to accommodate your needs if you seek this retirement lifestyle.

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Still Popping Pills Because Your Doctor Said To Take Them?

Bottle of spilled pills on black background

If you are among more than half of the nation’s population (seniors mostly), you are probably taking a prescribed medication. Very possibly, you are taking more than one…or a couple different ones daily…or so many daily you lose count. This goes not only for prescription drugs but also over-the-counter drugs, vitamins and supplements.

Nobody beats us for Pill Popping

 What this all means is Americans take more pills today than any other time in our history. No other country can match us for pill popping.

Sure, we have been handed excellent advances by the medical profession that enhances our resistance to disease and illness by taking prescription drugs.

At the same time, we see multiple prescription drugs interacting unfavorably with one another and causing our body to suffer. Not only that, but notable numbers of unnecessary drugs are handed out to patients by medical professionals because it’s the easy way to hopefully cause a respite to cure rather than examining other lifestyle external factors that could replace prescription drugs.

The medical profession hands out drugs because they have been pressured by the drug industry that medical products are a sure cure for what ails us.

Have you every counted the number of drug advertising commercials on a typical TV night compared to cars or fast food. In the ad world it’s called the “push” strategy. Prospective patients see the ads, and then ask their doctor to give the drug to them.

When Drugs Don’t Mix

What happens? Around 1.3 million people were taken to ERs in 2014 for adverse prescription drug effects. Of that large group, around 124,000 didn’t make it and died, according to the Center for Disease Control and Prevention and the Food and Drug Administration.

What if you could eliminate one or two of your cocktail of different medications? Would it make a positive difference in your overall health picture? Make sure you are being helped and not harmed by your drug regimen.  There’s ways to do this as outlined in an excellent special report, “Too Many Meds” in Consumer Reports Magazine (Sept 2017). This major article gives you some health saving tips to empower and protect your well being.

First, get to know your pharmacist–he’s cheaper than your doctor. Utilize these two individuals that oversee your health maintenance to give you good advice on the medications you are taking.

One warning is many older seniors have more than one specialist medical doctor treating different health issues. That’s a red flag that some medications may not be known to your primary medical doctor. Here are but a few of negative drug interactions that can occur:

MAIN DRUG MIX WITH THESE WHAT CAN HAPPEN
WARFARIN (treat and prevent blood clotting) Antidepressants (like CUMBALTA, PROZAC) Pain reliever like ASPIRIN, ADVIL AND ALEVE Internal Bleeding
LITHIUM (treat bipolar disorders) Diuretics or ACE inhibitors (used to treat high blood pressure and heart failure) Tremors, slurred speech, seizures, and heart palpitations
THEOPHYLINE (treat asthma, obstructive pulmonary disease, etc) CIMETIDINE (used to treat stomach ulcers and acid reflux Seizures

 Bag Them!

Gather up all you medication containers and supplements, bag them and take them to your local pharmacist. Spread them out on the counter, and ask him/her if he notices any interaction issues with the drugs you take now. Ask him/her, as well as your doctor, if some of your drugs can be eliminated? Could dosage be reduced or another drug substituted with reduced side effects? Ask him about lifestyle changes that eliminate or scale down your medications such as a more healthy diet, an exercise routine or curbing your smoking and/or alcoholic habit.

Don’t Let the Pills Blog You down

What you learn from your personal health provider(s) may lead you to less dependency on prescriptions drugs and a “enjoy life more” you. You may even feel like getting up in the morning and enjoying the whole day with more energy and a better outlook. What’s better than that?

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Saving a Lot Or None at All for Retirement? … Where Do You Stand?

Feed Me

Does your money disappear before the end of the month? If you’re like most Americans, you are more tuned to getting the immediate bills paid vs. thinking about way out in the future.

The story here is your retirement. The vast majority of Boomers (born 1946-1964) and seasoned seniors (born before 1946) have saved very little for their retirement years. In fact, 50 per cent of total Americans have put away nothing, nada for the Golden Years.

1 in 3 Americans Have $0 Saved for Retirement

Here is the research based on a 2016 gobankingrates.com survey: 35 per cent of all U.S. adults have about several hundred dollars set aside as retirement savings. Thirty-four per cent have zero savings and about half have no retirement account savings at all.

The survey cut across three income groups: millennials (18-34), Generation Xers (34-54), and baby boomers/ seniors (55 and over) with the intention of determing how these groups are saving for retirement. The survey revealed that many people are not on track to have enough money to cover their necessary needs during retirement.

Most of our concern is the situation of baby boomers and seasoned seniors who are reaching the “tipping” point of having nonsufficient resources to have a full retirement.

The key to retirement savings success is to begin as early as you can, take advantage of any employer matches, and automatically transfer funds from your paycheck to your retirement fund so that you do not even think of that money as disposable income. Treat savings as an expense and pay yourself first.

As seniors get closer to joining the retirement club, the gap between the savers and the save-nots widens. Although a larger portion of people age 55 and over report high-balance retirement funds ($300K+), there remains a significant subgroup that has little to no retirement savings.

Among those 60 and over, about a 25 percent have sufficient retirement savings, but the other 74 percent are still behind.

What’s the problem? The answer is “Procrastination”. Concerned about the bills due today and the things you want to buy tomorrow. Before you know it, twenty or thirty years have passed in a flash. Retirement age is coming and you know you don’t have enough money to retire with the lifestyle you’re accustomed.

From our book, Rollover, here are a few things you might consider as you move from a life of accumulating wealth to a life of distributing wealth:

#1 Work Your Contributions at Work. While you’re working, maximize the contributions to your retirement plan (i.e. 401(k) etc). Go max on the amount your employer is contributing.

#2 Work Longer…Retire Later. Having income coming in gives you a leg up to continuing to put funds into your retirement account. If your company provides health insurance, so be it and stay as long as you can.

#3 Cut Expenses, BIG and Little. Move somewhere where housing and everyday expenses are lower. How about downsizing to a smaller place like a condo or apartment? No new car, keep the old one. Investing that $400 new car payment for a 5 percent return to put more than $27,000 into your retirement account in a five years.

#4 Apply for Social Security… Now or Later. If you don’t need that SS check at 62, don’t apply until age 66. It means around 8% more per year on your final award. By waiting until age 70, the monthly benefit would be $1690 over $960 at age 62. Be careful, rules are changing. Check it out.

#5 Put Your Money Where the Returns Are. Educate yourself or consider paying an independent professional in choosing the right asset-management process during your retirement years. It can be a minefield without good advice.

About 80% of Americans Over 40 Are Behind on Saving for Retirement

savers_chartSource: https://www.gobankingrates.com/retirement/1-3-americans-0-saved-retirement/
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