A digest of timely information and insight about finance, investing, and retirement.
In the past year, Colorado has moved up a few notches on an annual list of “best states to retire.” According to WalletHub, Colorado now ranks as the second-best state in the country to retire, behind only Florida. A year go, Colorado was ranked fifth. The criteria included affordability, quality of life, and health care.
The ninth biennial Risks and Process of Retirement Survey from the Society of Actuaries (SOA) identified an overall increase in consumer concern for their finances both prior to and during retirement in 2017. A significant number of retirees and pre-retirees report that they feel unprepared to navigate financial shocks and unexpected expenses – 61 percent of pre-retirees and 47 percent of retirees feel unprepared for expenses in retirement that could deplete their assets.
Social Security faces a long-term financial crisis. The demographic bump of baby boomers will continue to flow into the Social Security system for many years to come, and the outflow of Social Security benefits will not only use up all available payroll tax revenue but also eat into Social Security trust fund reserves, with projections suggesting a shortfall that leaves roughly a quarter of scheduled benefits unfunded. Many lawmakers see raising the full retirement age for Social Security benefits as a potential solution to the program’s financial woes. Yet, when lawmakers advocate for higher retirement ages without making similar changes to the age for collecting early benefits, the net impact is simply to cut monthly benefits to retirees.
About half of baby boomers are now over age 62 and can claim their Social Security benefits. The year 1955 was the midpoint for the post-World War II population explosion – and those boomers born in 1955 will turn 63 sometime this year.
A major missing piece in Kentucky’s lean 2018-20 state budget proposed by its governor, Matt Bevin, is the impact of a pension reform bill that legislative leaders are secretly writing. While the reform plan is being finalized, the governor and Republican leaders in the Kentucky legislature have endorsed a new approach to funding pensions that would require $392 million more in annual funding for the Teachers’ Retirement System.
An older person’s trip to the ER often signals a serious health challenge and should serve as a wake-up call for caregivers and relatives. Illnesses or injuries that lead to ER visits can initiate a fairly vulnerable period of time for older persons, and risks increase for seniors to acquire a disability within six months of an ER visit.