November 2012


Here is November’s review of blog posts. We hope you find something you enjoy!

Get Rich SlowlyThe really, really, really long-term view…and when you’ll die – Not knowing how long you are going to live can cause you problems when planning on how much money you’ll need to retire.

Good Financial CentsWhat is the Average Retirement Age? – The average retirement age is on the rise, and for good reason.

Good Financial Cents3 Tips for Baby Boomers Preparing for the Long Term – When you look at the long term, don’t forget to consider the cost of the care you might need in the future.

U.S. News MoneyGet-Out-of-Debt Resolutions for 2013 – Getting out of debt is a great financial New Year’s Resolution to set for yourself.

U.S. News Money Year End Retirement Planning Tips – December 31st is the deadline for some important retirement planning decisions.

Please let us know if you have a favorite financial blog that you think we should be reading.

 

  • Disclaimer: The information on this blog is not meant for specific financial advice. The ideas/opinions stated are not suited for everyone, and readers should use their own judgment in applying them in their financial lives.

We’re wishing everyone a Happy Thanksgiving! We know it’s not until next week, but we’ll be taking this Friday and next Friday off for the holiday. We’ll resume our weekly posts on Friday, November 30th.

A post over at Good Financial Cents this week, “Why You Might Not Want to be an “Average” American” by Miranda Marquit pointed to some “average” U.S. statistics that you should probably strive to be better than:

  •  “the average household credit card debt was $7,149” – Certainly not insurmountable, but with credit card interest rates typically high, carrying that amount of debt on credit cards can lead to large monthly payments. It also can mean many years of paying it down, assuming of course, that you aren’t adding new debt in the meantime.
  •  The average indebted household debt (this doesn’t include the mortgage) was $15,325” – More than double that of the average credit card debt. We would guess that in many cases, this would include debt for a car. Monthly payments on debt this size could be crippling to your finances, especially for lower income families, making it even more difficult to get out from under.
  •  “the savings rate at the end of September 2012 was 3.30%” – This amount wouldn’t even be enough to fund an emergency fund for many families, let alone allow them to save for other necessities and goals. It wouldn’t be unthinkable to say this savings rate is likely why the average debt is so high—when emergencies or other needs and wants pop up, families just don’t have enough cash saved to cover them, so they turn to their credit cards.
  • “According to the Social Security Bulletin, only about 1/3 of people aged 65 and older has an IRA or a 401(k)” – Since Social Security is often not enough to cover people’s retirement expenses, retirement funds are relied upon to cover the gap. However, for those who have no retirement funds, they have no choice but to make do. And with the savings rate so low, it unlikely they have funds elsewhere to turn to.
  •  “Those in the younger age bracket of 18 to 34 aren’t really saving, either: 56% are not saving at all” (referring to retirement) – These years are the best time to get started saving for retirement. Even though it is often the case that you will be making less during these years than later in your career, you will likely have less financial commitments. Maybe you haven’t bought a house yet, haven’t gotten married yet, or haven’t had kids. So, putting money aside may not hurt as badly as when you do these things. Unfortunately, the idea of “I have plenty of time” gets to many people. By the time you realize you need to get serious about retirement, it may be too late for you to make up the ground you lost during these years.

Obviously these statistics don’t tell the whole story. There are always mitigating circumstances: illness, job loss, disability, etc. However, the earlier you start taking these “averages” seriously, the better off you’ll be down the road.

 

  • Disclaimer: The information on this blog is not meant for specific financial advice. The ideas/opinions stated are not suited for everyone, and readers should use their own judgment in applying them in their financial lives.

Are you nearing retirement, but don’t want to stop working altogether? Have you considered working from home? In some cases, you may be able to find work doing the job you did during your career right from your own home. Tired of that job and want to find something else? There are plenty of options.

Jeff Rose over at Good Financial Cents had a post on Wednesday about this concept, “65 Home Business Ideas You Can Do From Your Kitchen Table.” There are many great ideas here! Maybe some you haven’t considered before.

You may not make as much doing one of these jobs as you did working your previous job (then again, you may make as much or more). However, that’s likely not your goal anyway. Working during “retirement” is a great way to offset expenses and avoid having to pull too aggressively down on your portfolio. And a job from home is also is a great way to stay productive while still giving you the flexibility to enjoy your free time.

Don’t think you can do it? While many of the jobs listed require a skill you may not have or a time commitment you aren’t willing to make, there are many more that are much more flexible (keep scrolling down). Love dogs? Become a dog walker or pet sitter. Love teaching? Become a tutor.

And this list is not just for retirees. These jobs could be for anyone looking to work from home.

 

  • Disclaimer: The information on this blog is not meant for specific financial advice. The ideas/opinions stated are not suited for everyone, and readers should use their own judgment in applying them in their financial lives.