Teach kids about money with back-to-school shopping

Yikes! It's way too early to even thing about back to school shopping but this article explains how parents can use this annual ritual to teach their children about budgeting, comparison shopping, and money management. Don't freak out your kids by talking about back to school in June, but prepare for this August ritual by reading "The Easiest Way to Teach Your Kids About Money This Summer" by Matt Brownell: http://www.dailyfinance.com/on/teach-kids-about-money-back-to-school-shopping/

Wives lose when husband claims Social Security at Age 62

"Many husbands file for their Social Security benefits at age 62, a decision that may one day deprive their widowed wives of up to $170 a month."
According to research reported in the Squared Away blog, "almost 40 percent of all Americans claim their benefits the same year they turn 62." When wives outlive their husbands they suffer from his decision to claim benefits as early as possible, resulting in a smaller benefit... until death.  The study’s author, Alice Henriques, an economist with the Federal Reserve Board in Washington, “was able to show that the husbands, when they made their decisions, took into account the impact on themselves of the claiming date they selected. But they showed virtually ‘no response to the large incentives’ of having the ability to provide their widowed wives with more income in the future.”  It’s time for wives to be more involved in crucial financial decisions. Come to the Sept. 11 FPW to learn more about SS claiming strategies. Read the details at the Squared Away Blog: http://squaredawayblog.bc.edu/squared-away/62yo-men-file-social-security-wives-pay/

12 Steps to Financial Independence

Check out these 12 steps to financial independence and success, courtesy of author Lon Jeffries and Utah Business magazine: http://utahfinancialadvisor.blogspot.com/2013/06/twelve-simple-steps-to-becoming.html

Don't get "framed" when claiming Social Security Benefits

"We've been framed, at least when it comes to deciding when to begin taking Social Security benefits. According to behavioral economics research, the way seniors are presented with information about Social Security benefits has a big impact on their decision."  Learn about how "anchoring" can affect this vitally important decision:
http://money.usnews.com/money/blogs/the-best-life/2013/05/22/dont-get-framed-when-claiming-social-security_print.html

Gen X better start investing more for retirement

According to a study by the Center for Retirement Research at Boston College, "retirement is likely to be an even greater financial challenge for Generation X, now in their 30s and 40s" than for their boomer parents who are so often the focus of hand wringing about insufficient retirement preparation. The decline of pensions, longer lives, and higher Social Security retirement ages are among the factors affecting Gen X even more than boomers. "The upshot: unless 30- and 40-somethings start saving more and making plans to work longer, they’ll be unable to maintain the lifestyle to which they are growing accustomed." Learn more at the Squared Away Blog (an excellent resource): http://squaredawayblog.bc.edu/squared-away/retirement-tougher-for-boomer-children/

Understanding Medicare

While Medicare eligibility begins at age 65, don't wait until your birthday to find out details and sign up.  You need to plan much further ahead to know what is covered, much that isn't, the costs of Medigap policies, and the premium costs which rise each year.
"Medicare is split into two different kinds of insurance. Original Medicare consists of Parts A and B and is taken by most people who turn 65. Part A pays for approximately 80 percent of hospital costs and deductibles apply, so if an extended hospital stay is required the costs still could add up."
"Part B is medical insurance and pays for about 80 percent of medically necessary services from doctors and some other health care providers. There is a monthly premium that is means tested based on the person’s income for the prior two years. The premium this year ranges from $104.90 to $335.70, depending on an individual’s income."
Part D "helps cover the cost of prescription drugs, but there are co-payments and co-insurance and there is a coverage gap once the recipient reaches a certain level of expenses where he has to pay the cost of drugs until coverage kicks in again."
"Part C of Medicare insurance is a Medicare Advantage plan that combines Parts A, B and sometimes D under one policy."  Read the full article for more details:
http://www.fa-mag.com/news/advisor-recommends-early-planning-for-medicare-14428.html

Retirement Income Inadequacy

“Seniors in 48 states do not have enough income in retirement to replace 70% of their pre-retirement earnings, based on median income, according to an analysis by Interest.com. Seniors have a median household income of $35,107, and only those in Nevada and Hawaii had the income level that hit the recommended pre-retirement income-replacement rate that financial planners recommend.” Take away message: start saving while you are young. Not that Hawaii seniors are doing well due to the strong union presence in the workforce. Neveda only looks good because younger workers in that state earn such low wages so seniors look good in comparison.  Details at: http://money.cnn.com/2013/06/10/retirement/retirement-income/index.html Now is NOT the time to cut Social Security benefits; it's time for minor adjustments to strengthen the system.

Think You’re Financially Literate?

More than three-quarters of U.S. adults think they are good at managing their finances. Only 14 percent, however, got the right answers to a 5-question quiz on basic financial concepts like interest rates, mortgages and inflation according to a State-by-State Financial Capability Survey released by the FINRA Investor Education Foundation. Take the quiz and see how you compare to the national results:  http://www.usfinancialcapability.org/quiz.php?utm_source=MM&utm_medium=email&utm_campaign=Foundation_News_060613_FINAL

Funding Retirement with Plastic

Now this idea just seems to go against prudent financial management until you consider the details. The idea is NOT to charge your expenses in retirement but to use your credit card to add to a retirement account rather than get frequent flyer miles (which are getting harder to actually turn into flights) or other rewards. You only receive the benefits if you pay your card in full each month so set up an auto pay from your checking account. Check out the details at: http://blogs.marketwatch.com/encore/2013/05/31/funding-retirement-with-plastic/ If you already have a cash back credit card, consider committing the cash to help fund your IRA rather than spend.