Saturday, December 20, 2014

Retirement Guide 2011

Retirement Guide 2011

Pursuing retirement in an uncertain time
Retire - if you dare

Retirement - something taken for granted by Americans going back half a century - is no sure thing anymore. Not after the Great Recession, years of high unemployment, the collapse of housing prices, and stocks still below historic peaks.

Many people now picture themselves, like it or not, working far into old age - if they even are able. Their battle cry could be "Retire, if you dare!"

In the old days, the 1990s, baby boomers said they were better prepared than their parents for retirement. Now, they're not so sure.

But are those boomers more likely to have a secure retirement than the younger generations they now seem pitted against in a scramble for old-age benefits? Columnist Maria Panaritis thinks so.

Oh, and what about real estate, whose sale after years of appreciation was supposed to provide one of the financial legs on the retirement chair? That chair is looking rickety - if not broken for many homeowners - real estate writer Alan J. Heavens says.

Nevertheless, countless individuals and families are doing what they can with what they have in pursuit of retirement in frightening and uncertain times.

As Mike Armstrong advises, you'll be in better shape if you plan.  The stories and columns here will help point the way.

- Reid Kanaley


When did you start planning?
In my 20s
In my 30s
In my 40s
In my 50s
In my 60s
I haven't started yet
I'm afraid to go there

Retirement used to be a virtual entitlement. These days, and certainly moving forward, it must be strategized, plotted well in advance of the completion of one’s working life. Even then, there are no assurances. Here are the stories of three families whose due diligence that should have resulted in comfortable retirement. But the outcomes are starkly different.

I may joke that winning the lottery will be the only way I'll afford retirement, but that doesn't mean it's my financial plan. I've been saving for retirement for years. I viewed it as a way of paying myself - or rather, my future self. While it can be disconcerting to open those quarterly account statement, it's been comforting lately to see the money I've deferred from my paycheck growing again.



It hasn't been the best of times for Americans on the verge of retirement. The housing market has been even less kind, both to retirees and builders of the homes they have long expected aging boomers to buy. Sure, there were surveys suggesting a growing market for "age-qualified" housing. But many people who were eager to move are just staying put.

Today's Xers in the workforce have, unlike prior generations, watched pensions vanish and their wages flatten - not grow. They also bought houses when prices were artificially high, meaning they carry more mortgage debt than those sitting on the fat equity of homes bought before the housing bubble jacked up prices to unprecedented heights.

Retirement planning is no small task. Ideally, you start it in your 20s - though not everyone has the forethought. For the rest of us, these sites provide some direction. Find instructions on applying for benefits. Plans for you based on your age. Advice for job-hunting seniors. And, for the generation that's staring down retirement now, advice for baby boomers.

Baby boomers facing retirement are worried about their finances, and many believe that they will need to work longer than planned or will never be able to retire, according to a poll released earlier this year. The 76 million-strong generation born between 1946 and 1964 has clung tenaciously to its youth. Now, boomers are getting nervous about retirement.

It took the collapse of her marriage to jolt Luanne Schmidt into action. After years of taking a hands-off approach toward money, the 50-year-old nurse only recently took charge of her finances.  "Do I know enough about finances and the market yet? No," says this mother of three. "But I'm at least headed in the right direction."

Managing money doesn't get easier with age. Workers often hit their peak earning years only to be pulled in several directions. Beyond basic expenses, there may be college-age children or aging parents who need financial help. It can be a lot to balance as retirement savings should take on more importance.

Lowering your tax bill can make all the difference in retirement. Taking maximum advantage of tax breaks and other strategies will make savings last longer. That means tax planning can't end with the annual filing deadline. Just as workers are becoming more self-reliant in financing retirement, it's increasingly important for retirees to be savvy about the tax consequences.

Fretting is the new normal for retirement. We haven't saved enough, too many of us retire without financial security, and we may need to work longer to achieve it - assuming we can hang on to our jobs or find new ones. No wonder that workers and retirees are more pessimistic about their future prospects than they've been in years.