Washington (CNN)Oliver North, the Fox News contributor and the central figure in the Iran-Contra scandal, will be the National Rifle Association’s new president, the group announced Monday.
Washington (CNN)Oliver North, the Fox News contributor and the central figure in the Iran-Contra scandal, will be the National Rifle Association’s new president, the group announced Monday.
Washington (CNN)A Department of Education team that had looked into fraud and abuse by for-profit colleges has been dismantled to the point that it has “effectively killed investigations” into institutions where top hires of Education Secretary Betsy DeVos once worked, The New York Times reported Sunday, citing current and former employees.
Department spokeswoman Elizabeth Hill told the Times that the team had lost members due to attrition and those investigations are just one way the team helps the department provide oversight. Hill also said the new employees who had worked in the for-profit education sector did not influence the team’s work.
The department’s deputy press secretary, Evelyn Stauffer, did not immediately return CNN’s request for comment Sunday.
The Education Department reached a limited settlement with the for-profit college in 2016 after finding it couldn’t back up claims that 90 percent of its alumni since 1975 were employed in their field of study within six months of graduating, according to the Times, which added that investigations into its other practices continued afterward.
Although Hill told the newspaper that the probe was suspended early last year, before President Donald Trump took office, former and current employees disputed her account, saying the team’s work became a contentious issue in meetings with Trump’s transition team, the newspaper reported.
Millions of Americans who went to college are now crippled by their student loans. “Debt is the first thing I factor in all of my decisions,” says Jessie Suren, who graduated with a criminal justice degree and is struggling to pay off her debt.
Currently, there is a focus because of external factors to public school (access to funding) to prepare a student for college and career readiness. Unfortunately, some of the advice is misguided because although efforts are directed at increasing attendance in college using federal student loans there is no preventive counseling to students on how to repay the debt.
I personally made the decision to use student loans because it was a way to increase my income. As a public school teacher, my pay is a direct correlation or table cross matrix between the years of service and my education accomplishments. Therefore the amount of increase in annual pay because of my degrees is not uncommon but still painful each month.
I choose not to squander and complain about the debt but instead focus on using the knowledge to build the additional income to pay off the student loan debt so I can retire in comfort. My education has developed my writing and research skills to a level that I firmly believe is capable of accomplishing anything that I focus on through the end.
Ann Brenoff’s “On The Fly” is a weekly column about navigating growing older and a few other things.
Sorry to be the bearer of bad news here, but you are about to get sucked into a hellhole, unlike anything you’ve ever previously imagined. It will devastate you, leave you emotionally spent, make you physically ill and resentful at times. It could totally derail your career or force you to dip into your retirement savings and then one day it will abruptly end and leave you in a state of deep grief. Oh, and the government doesn’t really give a damn about any of this, so you are pretty much on your own.
What is this nightmare scenario? You are about to become my generation’s caregivers.
That’s right. A recently released AARP report, “Millennials: The Emerging Generation of Family Caregivers,” points the finger squarely at you. It notes that your caregiving responsibilities are just starting to rev up, with about 1 in 4 of you already putting in an extra 21 hours a week taking care of us. To be clear, that is 21 unpaid hours while you work at your real jobs and/or care for your own families at the same time.
Close to half of you will be helping a parent or a parent-in-law. In most cases (65 percent), it will be your mother, said AARP. About 76 percent of the people cared for by millennial family members are 50 or older, and the average care recipient is 60 years old. The average care recipient helped by a grandchild is 77 years old. And more than half of millennial family caregivers (51 percent) are the sole caregiver, alone in their duties.
You can expect this trend to continue. As more people like me go not-so-gently into our elder years, more of you will be asked to step up and take care of us. Why? U.S. public policy has lagged woefully behind today’s reality that 10,000 baby boomers a day are turning 65. And that burden is headed straight to your shoulders.
So let’s start with what caregiving entails. My generation already knows this, because we’ve served as our own parents’ and spouse’s caregivers, but here’s the CliffsNotes version for you.
Family caregivers today do many of the same things that nurses do, and then some. And much of it isn’t pretty.
You can look forward to changing adult diapers (just don’t dare try to claim those as a caregiving expense!), giving medications, installing safety bars, taping down rugs and telling your grandmother who helped raise you that she can’t drive anymore while she sobs and asks you what your name is. Again.
You will be changing catheters and testing blood and hooking up your dad to a home dialysis machine because visiting health aides don’t come every day. Family caregivers do. You will sometimes forget to dispose of your “sharps” properly and someone will call you on it.
You will make multiple trips a week driving your loved one to doctors, waste hours in line at the pharmacy and spend hours on the phone with insurance providers all the while trying to juggle your own life, family, and job. You will blow your stack, cry yourself to sleep and endure days when you don’t even have time to shower. Your own health will suffer. The stress of trying to work while doing all this will feel unbearable at times, especially if you’re doing it without help. Impatience may become your middle name.
You are a godsend that’s what everyone will tell you. After all, the work done by the nation’s family caregivers would cost about $642 billion a year if it were done by paid skilled nurses, according to the Rand Corp. Meanwhile, Rand put the annual income lost by family caregivers for the elderly at $522 billion. That was in 2014, so you can mentally adjust for inflation.
It’s staggering. Bear in mind: Family caregivers labor free of charge, contributing their time, their energy and often their own well-being. You will join their ranks out of love, obligation, guilt and for one other important reason: You’ll have no choice.
And it will cost you in yet another way. Caregivers’ out-of-pocket costs were nearly 20 percent of their annual income, AARP said in its 2016 report, with average annual spending of $6,954.
To cover the extra expense, AARP notes, many family caregivers cut back on their own spending. They reduce, if not stop, saving for retirement altogether. They don’t eat out or take vacations. And many have dipped into personal or retirement savings.
Many caregivers find their health adversely affected. A UCLA Center for Health Policy Research survey found that nearly one-third of the estimated 3 million-plus informal caregivers in California reported emotional stress so severe it disrupted their lives. “Caregiver syndrome” is the popular name for the anger, guilt, and exhaustion that come from providing unrelenting care for a chronically ill loved one.
As you will quickly find out for yourself, respite care an outsider to come in and give you a break once in a while is expensive and not always available.
Caregiving can impact your health, but what it does to your career is something awful times two. Caregivers miss days of work, don’t apply for or accept promotions, and sometimes just drop out of the paid workforce altogether to care for their loved ones.
Lost wages and benefits average $303,880 over the lifetimes of people 50 and older who stop working to care for a parent, according to a National Academies of Science, Engineering, and Medicine report. To add insult to that injury, a lower earnings history means reduced Social Security payments when you become eligible.
That National Academies of Science, Engineering, and Medicine report provides a very sobering look at the state of family caregiving in the U.S. It notes that caregivers are cracking under the strain, and although things could be done to support them, nobody is really paying attention.
What could be done to ease the almost certain misery you’re headed for? How about tax credits for caregiving or reimbursement for caregiving expenses? Why not offer Social Security credits so that caregivers don’t miss out down the road? And maybe pass paid family leave to take care of an elderly loved one so that after you’ve spent the night dealing with Grandpa’s tendency to rage after sunset, you don’t have to report to work at 9 a.m. the next day?
P.S. Welcome to the club.
Like millions of other Americans, financial journalist Janet Alvarez was laid off from her job in 2009. She decided to ride out the recession by pursuing her MBA, racking up six figures in student loan debt along the way.
But when she graduated, the economy was still sputtering, and there were few jobs available for her, despite her advanced degree. Her credit score was in the gutter, and to top it off, she had tens of thousands of dollars in medical debt.
“I was really at a rock bottom,” said Alvarez.
But thanks to her professional background, she had the skills to dig up solutions to her massive debt problem. Through a combination of income-driven repayment and refinancing, she was able to lower her payments until she was in a position to aggressively tackle her loans. Today she is nearly debt-free, and as the executive editor of personal finance site Wise Bread, she helps others navigate similar difficulties.
Whether you’re barely scraping by or simply want to pay less per month on your student loans, there’s hope for getting those payments lowered.
When you graduated from college, you were automatically enrolled in the standard repayment plan, the default plan for federal borrowers, which requires you to pay off your loan over 10 years. What you might not realize is that this plan is not your only option far from it, in fact.
One way to lower your monthly payments is to enroll in an extended payment plan. Adam Minsky, a lawyer whose practice is dedicated entirely to helping people with student loans, said this allows you to stretch out payments over up to 25 years. With more time to pay, the amount you have to hand over each month decreases.
The extended repayment option is available only to federal student loan borrowers (as are most repayment benefits). Additionally, you cannot have had an outstanding balance on any Direct Loans or Federal Family Education Loan (FFEL) Program loans before Oct. 7, 1998, and you must have at least $30,000 in Direct or FFEL loans.
The drawback? The longer you take to pay off your loan, the more you’ll pay in total interest. It’s important to ask yourself whether lower payments now are worth spending more on your loans over time.
If your income is low now but you expect it to increase over the next few years, a graduated repayment plan might give you the breathing room you need.
Rather than fixed payments over 25 years, this variation of the extended repayment plan starts off with monthly payments that gradually increase. Most federal loans require a payment period of just 10 years. However, if you consolidated any loans through the Department of Education, you may have 10 to 30 years to pay off the consolidated loan, depending on how much you owe.
If you’re unemployed … your payment might actually be $0. Janet Alvarez, executive editor of WiseBread
You also have the option of enrolling in one of four available income-driven repayment plans, which cap monthly payments as a percentage of your discretionary income.
In fact, according to Alvarez, “if you’re unemployed or your earnings dropped to a very low level, then your payment might actually be $0.”
These plans promise to forgive any remaining balance after the repayment period is up, though borrowers must pay taxes on the full forgiven amount the same year it’s discharged.
Another reason to consider an income-driven plan: You might get your debt forgiven sooner, tax-free.
“Certain loan forgiveness programs require that you be in certain types of repayment plans,” said Minsky. “For instance, the Public Service Loan Forgiveness program requires that borrowers be on an income-driven plan. So if you’re not in one of those plans, you might not be able to make qualifying payments toward that program.”
If you are considering one of these income-driven plans, be sure to fully investigate all the rules before committing. Then you can use the Department of Education’s repayment estimator to crunch the numbers and see which plan would work best for you.
If you have multiple federal student loans with varying interest rates, repayment terms, and payment due dates, a direct consolidation loan is a convenient way to roll all those loans into one. Plus, borrowers with loan balances exceeding $60,000 can extend their loan term up to 30 years, according to Minsky.
Consolidating is often required to enroll in certain repayment and forgiveness programs, including those outlined above. But even if you don’t pursue one of these programs, simply consolidating and extending the repayment period beyond 10 years is another way to see lower payments.
Keep in mind that federal consolidation doesn’t save you any money. Not only will you pay more interest over time, but also the interest rate you pay on your new loan will be a weighted average of your old loans, plus a small percentage. Again, you’ll have to decide what’s more important to you: more cash now or more savings overall.
One of the few options available to borrowers who took out private loans is student loan refinancing.
The process of refinancing involves taking out a new loan through a private lender and using that money to pay off your old loans. The goal is to achieve better terms with the new loan, such as a lower interest rate or different repayment term. Since refinancing is available only through private lenders, you’ll be subject to a credit check and other eligibility requirements to qualify, all of which vary by lender.
[With private loans,] basically, you owe what you owe, and you have to pay it. Janet Alvarez
Although it’s possible to refinance federal and private loans, refinancing federal loans is generally ill-advised. That’s because refinancing with a private lender strips you of any federal protections, such as income-driven options, forgiveness programs, deferment, and forbearance.
“Private loans generally don’t include any provisions to protect borrowers during times of unemployment or financial difficulty,” said Alvarez. “Basically, you owe what you owe, and you have to pay it.”
Even so, if you have older federal loans or high-interest PLUS loans, scoring a lower interest rate might be worth giving up those benefits.
“It comes down to the borrower’s risk tolerance … whether they’re comfortable giving up those rights and protections that are inherently part of the federal loan system,” said Minsky.
If you have private student loans, be sure to opt into your lender’s autopay program. Most lenders will provide a rate discount in exchange for the guarantee that they’ll get paid on time and in full every month.
Usually, the discount is a small 0.25 percent. Even so, every bit helps, especially if you have a large balance. Some lenders will offer an additional discount if you’ve made consistent payments for a certain period, according to Alvarez.
“Most of us will at some point encounter difficulties that are beyond our control,” said Alvarez. “A recession, we can’t control. Layoffs, we often can’t control.”
However, she said, after rebuilding her financial life from scratch, she felt much more empowered.
“I understood how the game worked,” said Alvarez.
The student loan system can feel like a game in which the odds are stacked against you. But if you know what tools are at your disposal, it’s a game you can learn to win.
Trump amassed a record $107 million in contributions to his inaugural committee. Previous presidents had kept donations low in an effort to avoid the appearance of selling presidential access — or favors.
As much as $45 million to the committee came from companies, some of which have served to shield the identities of the individual donors behind them. Following an investigation last year by HuffPost, the committee also admitted that it had made numerous errors in a list of donors it filed with the Federal Election Commission.
Mueller’s team has talked to witnesses about millions of dollars in contributions from donors to the inaugural committee with links to Russia, Qatar, the United Arab Emirates and Saudi Arabia, ABC reported, based on information from a source who has been present at recent interviews. Donations from some of those individual donors surpassed $1 million each, ABC said.
One of those questioned was California billionaire real estate investor Thomas Barrack, a longtime friend of Trump who was in charge of fundraising for the inaugural committee. Barrack has substantial private equity holdings in the Middle East.
One donor being scrutinized by Mueller’s team is American Andrew Intrater, who is both a business associate and relative of Russian multibillionaire Viktor Vekselberg, who owns the Russian global conglomerate Renova Group. That company was sanctioned in April by the U.S. Treasury Department to punish Russia for meddling in the U.S. presidential election and other suspected “malign activity.”
Vekselberg, who has close ties to Russian President Vladimir Putin, is an investor in New York investment company Columbus Nova. Renova recently listed Columbus Nova as a subsidiary, and it was identified as such in filings with the Securities and Exchange Commission.
Intrater, the CEO of Columbus Nova, donated $250,000 to Trump’s inauguration committee, according to FEC filings.
Columbus Nova also reportedly paid Trump’s personal attorney Michael Cohen $500,000 for consultant fees after Trump’s election. The company has acknowledged the payments to Cohen regarding information concerning “potential sources of capital and … investments in real estate and other ventures.” But the company statement denied that Vekselberg had anything to do with the money.
Columbus Nova was also involved in registering domain names during the presidential election for websites appealing to white nationalists, The Washington Post reported this week.
Life expectancy is rising globally – people born in 2016 will on average live seven years longer than those born 25 years ago.
Enter your information below to find the life expectancy for people of your age, country, and gender, as well as the proportion of your life you can on average, expect to be healthy.
Read more: http://www.bbc.co.uk/news/health-44107940
As an education investor, one of my favorite sayings is that education is the next industry to be disrupted by technology, and has been for the past twenty years.
When I started my career at Warburg Pincus, I inherited a portfolio of technology companies that senior partners naively believed would solve major problems in our education system.
It would have worked out fine, of course, except for all the people. Teachers weren’t always interested in changing the way they taught. IT staff weren’t always capable of implementing new technologies. And schools weren’t always 100% rational in their purchasing decisions. And so while, given the size of the market, projections inexorably led to $100M companies, sales cycles stretched asymptotically and deals never seemed to close, particularly in K-12 education.
My current firm, University Ventures, began life in 2011 with the goal of funding the next wave of innovation in higher education. Much of our early work did revolve around technology, such as backing companies that helped universities develop and deploy online degree programs. But it turned out that in making traditional degree programs more accessible, we weren’t addressing the fundamental problem.
At the time, America was in the process of recovering from the Great Recession, and it was clear that students were facing twin crises of college affordability and post-college employability. The fundamental problem we needed to solve was to help individuals traverse from point A to point B, where point B is a good first job – or a better job – in a growing sector of the economy.
Once we embarked on this journey, we figured out that the education-to-employment missing link was in the “last mile” and conceptualized “last-mile training” as the logical bridge over the skills gap. Last-mile training has two distinct elements.
The first is training on the digital skills that traditional postsecondary institutions aren’t addressing, and that is increasingly listed in job descriptions across all sectors of the economy (and particularly for entry-level jobs). This digital training can be as extensive as coding, or as minimal as becoming proficient on a SaaS platform utilized for a horizontal function (e.g., Salesforce CRM) or for a particular role in an industry vertical. The second is reducing friction on both sides of the human capital equation: friction that might impede candidates from getting the requisite last-mile training (education friction), and friction on the employer side that reduces the likelihood of hire (hiring friction). Successful last-mile models absorb education and hiring friction away from candidates and employers, eliminating tuition and guaranteeing employment outcomes for candidates, while typically providing employers with the opportunity to evaluate candidates’ work before making hiring decisions. Today we have eight portfolio companies that take on risk themselves in order to reduce friction for candidates and employers.
The first clearly viable last-mile training model is the combination of staffing. Staffing companies are a promising investment target for our broadened focus because they have their finger on the pulse of the talent needs of their clients. Moreover, staffing in the U.S. is a $150B industry consisting of profitable companies looking to move up the value chain with higher margin, differentiated products.
Because fill rates on job requests can be as low as 20% in some skill gap areas of technology and healthcare, there is no question that differentiation is required; many companies view staffing vendors as commodities because they continue to fish in the same small pool of talent, often serving up the exact same talent as competitors in response to requests.
Adding last-mile training to staffing not only frees the supply of talent by providing purpose-trained, job-ready, inexpensive talent at scale but also increases margins and accelerates growth. It is this potential that has prompted staffing market leader Adecco (market cap ~$12B) to acquire coding boot camp leader General Assembly for $412.5M. The acquisition launches Adecco down a promising new growth vector combining last-mile training and staffing.
We believe that staffing is only the most obvious last-mile training model. Witness the rise of pathways to employment like Education at Work. Owned by the not-for-profit Strada Education Network, Education at Work operates call centers on the campuses of universities like the University of Utah and Arizona State for the express purpose of providing last-mile training to students in sales and customer support roles. Clients can then hire proven talent once students graduate. Education at Work has hired over 2,000 students into its call centers since its inception in 2012.
Education at Work is the earliest example of what we call outsourced apprenticeships. For years policymakers have taken expensive junkets to Germany and Switzerland to view their vaunted apprenticeship models – ones we’ll never be able to replicate here for about a hundred different reasons. This week, Ivanka Trump’s Task Force on Apprenticeship Expansion submitted a report to the President with a “roadmap… for a new and more flexible apprenticeship model,” but no clear or compelling vision for scaling apprenticeships in America.
Outsourced apprenticeships are a uniquely American model for apprenticeships, where service providers like call centers, marketing firms, software development shops and others decide to differentiate not only based on services but also based on a provision of purpose-trained entry-level talent. Unlike traditional apprenticeship models, employers don’t need to worry about bringing apprentices on-site and managing them; in these models, apprentices sit at the service provider doing client work, proving their ability to do the job, reducing hiring friction with every passing day until they’re hired by clients.
America leads the world in many areas and outsourcing is one of them. Outsourced apprenticeships are an opportunity for America to leapfrog into leadership in alternative pathways to good jobs. All it will take is service providers to recognize that clients will welcome and pay for the additional value of talent provision. We foresee such models emerging across a range of industries and intend to invest in companies ideally positioned to launch them.
All of these next generation last-mile training businesses will deliver education and training – predominantly technical/digital training as well as soft-skills where employers also see a major gap. They’ll also be highly driven by technology; technology will be utilized to a source, assess and screen talent – increasingly via methods that resemble science fiction more than traditional HR practices – as well as to match talent to employers and positions. But they’re not EdTech businesses as much as they are full-stack solutions for both candidates and employers: candidates receive guaranteed pathways to employment that is not only free – they’re paid to do it, and employers are able to ascertain talent and fit before hiring.
While last-mile solutions can help alleviate the student loan debt and underemployment plaguing Millennials (and which put Gen Z in similar peril), they also have the potential to serve two other important social purposes. The first is diversity.
Just as last-mile providers have their finger on the pulse of the skill needs of their clients, they can do the same for other needs, like diversity. Last-mile providers are sourcing and launching cohorts that directly address skill needs, as well as diversity needs.
The second is retraining and reskilling of older, displaced workers. For generations, college classrooms were the sole option provided to such workers. But we’re unlikely to engage those workers in greatest need of reskilling if college classrooms – environments where they were previously unsuccessful – are the sole or even initial modality. As last-mile training models are in simulated or actual workplaces, they are much more accessible to displaced workers.
Finally, the emergence of last-mile full-stack solutions like outsourced apprenticeships raises the question of whether enterprises might not only seek to outsource entry-level hiring but all hiring. Why even hire an experienced worker from outside the company if there’s an intermediary willing to the source, assess and screen, upskill, match, and provide workers on a no-risk trial basis? As to sourcing, screening, skill-building, and matching technologies become more advanced, why not offload the risk of a bad hire to an outsourced talent partner? Most employers would willingly pay a premium to reduce the risk of bad hires, or even mediocre hires. If the market does evolve in this direction, education investors with a full-stack focus have the potential to create value in every sector of the economy, making traditional investment categories of “edtech” seem not only naïve but also quaint.
It can be tough to save for retirement when it is still decades away. It’s apparently even tough for older workers who are on the verge of retirement. Living expenses can eat up paychecks, and saving takes a back burner to spend. But it leads to the quintessential fear of what having no money in our older years looks like: the elderly parent who must move in with an adult child, having to choose between food and prescription drugs because only one can be afforded.
Here are some numbers that should scare you into becoming a retirement saver right this very minute:
That’s the amount of money 21 percent of all adult Americans have saved for retirement, according to a recent survey. Not one dollar. Nothing, zero, zip. These adults vary in age, occupation, education and skill set; they come from all over the country, and they are of every ethnicity and race. What they all have in common is just this one thing: They haven’t saved a nickel for retirement. Oh, and most of them work!
Almost 66 percent of employed people between the ages of 21 and 32 have absolutely nothing saved for retirement. For working Latinos in that age bracket, that number jumps to 83 percent. The National Institute on Retirement Security says the reasons for this vary, but certainly include the usual suspects of student loan debt and high housing costs. Things are so tough that 40 percent of millennials are still living at home, real-estate listing site Trulia found in an analysis of 2015 U.S. Census data. It’s the largest percentage since 1940, almost an 80-year period.
Savings among baby boomers the generation with retirement nipping closest to its heels is in the danger zone. One in three boomers has $25,000 or less in retirement savings.
Fidelity says that by age 30, you should have one year’s worth of salary saved. The company bumps that to twice your salary by age 35, three times your salary by age 40, seven times at 55, and 10 times at 67.
So, if you are 67 and earning $100,000 a year, you should have $1 million saved. Pass the Kleenex time?
Here’s a reality check: Across all age groups, the average retirement savings is a mere $95,766, according to the Economic Policy Institute, proving that Americans just don’t save enough, regardless of their age.
How do you get back on course? If you’re not saving enough in your employer’s plan to get the full matching contribution, increase your contribution. If you don’t have access to a 401(k), start an IRA. Use a nifty calculator like this one that tells you what each big purchase you want to make will “cost” in terms of retirement years. And for inspiration, watch your money grow on a compound interest calculator.
One of the more widely used rules of thumb says that for every $1,000 in monthly income you will need in retirement, you should have $250,000 saved. Let’s say you estimate that you will need $4,000 a month to live on when you retire. Roughly speaking, means you need to save $1,000,000.
This rule assumes that your investments will generate an annualized real return of 4 percent per year. Stocks, over the long run, are expected to produce annualized returns of roughly 7 percent, and this rule allows for inflation to devalue the dollar at roughly 3 percent a year. If investments generate less or inflation busts out, all bets are off.
According to Economic Policy Institute data, the average retirement savings for families aged 50 to 55 is $124,831. For families aged 56 to 61, it’s $163,577. That’s far less than the recommended $1 million.
Your 50th birthday means you can legally begin making catch-up contributions to your employer’s 401(k) or your individual retirement account. Go hurry and catch up!
Two-thirds of working millennials are offered retirement plans through their employers, but only 34 percent of them participate.
The National Institute of Retirement Security says the other 66 percent aren’t always eligible, despite working for a company that offers a plan. Employers usually require new employees to be with the organization for at least a year before allowing them into retirement plans. Millennials tend to jump from job to job, which hurts them when it comes to retirement savings. In 2014, more than half of millennials had spent a year or less with their current employers, according to NIRS.
One way around it is to set aside money each pay period until you’ve been with an employer for a year and then dump it into your new retirement account. That, or start an IRA. Not saving is not a good option, even if your company makes it harder to do.
It’s recommended that millennials save 15 percent of their salary for retirement. Only 5 percent of them do.
The best way to save for retirement is through our jobs. By increasing employer matches and default contribution rates, employers can greatly assist all workers with early-in-career, lower-income savings. Remember, those early-in-career savings increase the value of a long-term account because of decades of compound interest.
You will need to replace 70 percent to 90 percent of your annual pre-retirement income through savings and Social Security. So, someone who was living on $63,000 a year before retirement would need $44,000 to $57,000 per year in retirement.
Plan for a 20-year retirement. Remember to adjust for inflation and consider Social Security’s uncertainties.
Speaking of Social Security heads up for a 23 percent reduction. According to the latest projection, if nothing changes, the Social Security Trust Fund will only have enough revenue coming in to pay 77 percent of promised benefits beginning around 2034. If you were expecting to get $2,000 a month, your payout would shrink to $1,540. For younger workers today, that means more of your retirement will need to be funded through your savings so start saving ASAP.
And for older Americans, it could mean certain poverty. For 61 percent of elderly beneficiaries, Social Security provides the majority of their cash income. For 33 percent, it provides 90 percent or more of their monthly income. The average monthly retirement benefit was recently $1,368, or $16,416 per year. The overall maximum monthly Social Security benefit for those retiring at their full retirement age in 2017 is still just $2,687 or about $32,000 for the whole year.
Ignorance is not bliss when you will probably need to fund a 20-year retirement, yet an Age Wave/Merrill Lynch report found that 81 percent of Americans have no idea how much money they will need for retirement. Granted, retirement savings amounts are based on a lot of assumptions about things you can’t predict in your future your health, where you live, etc. But that’s not an excuse for saving nothing.
Start somewhere and take ownership of at least setting a target amount as a goal. That, or cue up the theme song from “The Twilight Zone.”
Atlanta (CNN)“The security guard refused to allow us inside.”