Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

Consumer Archive

Consumer

How To Retire Happy On H&FF Radio

 Permanent link
WASHINGTON (6/28/13)--Prepare for a flawless retirement and aim for smart financial benchmarks with this week's Home & Family Finance Radio.

In this episode, which you can listen to on the Internet, host Paul Berry, Washington, D.C., journalist and broadcaster, discusses these topics with special guests:

  • "Retire Happy." Stan Hinden, a former retirement columnist for The Washington Post and author of the recently updated "How to Retire Happy: The 12 Most Important Decisions You Make Before You Retire," Bowie, Md., shares the crucial components of a successful retirement.
  • Avoid These Retirement Setbacks." Jane Clark, a senior editor with the magazine Kiplinger's Personal Finance, Washington, D.C., shines a light on six common retirement pitfalls and how to sidestep them.
  • "Gauging Financial Progress." Susan Tiffany, certified credit union financial counselor and director of consumer periodicals, Credit Union National Association, Madison, Wis., acknowledges it's easy to get lost in the financial weeds and gives you some benchmarks to put you on the right path.
Home & Family Finance is a resource center for personal finance information at CUNA. The radio show is sponsored by CO-OP Network, the national credit union ATM network; Cabot Creamery Cooperative, maker of award-winning cheddar; and the Defense Credit Union Council and member credit unions, serving those who serve the country worldwide.

Home & Family Finance airs Sundays at 3 p.m. ET on the Radio America Network. The show also is carried on American Forces Radio Network. The one-hour program devoted to consumer finance issues is brought to you by America's credit unions and their 95 million members, and is presented by CO-OP Network.

CUNA and Radio America are podcasting Home & Family Finance through iTunes, Podcast Alley, Odeo, and other popular podcast library sites, as well as on Radio America and CUNA's websites.

For related information, read "Two Surveys Show That Americans Need Financial Overhaul" and "Elders Are Easy Targets for Scams" in the Home & Family Finance Resource Center.

DOL Launches Online Retirement Toolkit

 Permanent link
WASHINGTON (6/25/13)--Workers trying to navigate the murky waters of Social Security, Medicare and Medicaid have a new tool, thanks to a collaboration among the Department of Labor (DOL), the Social Security Administration (SSA), and the Centers for Medicare and Medicaid Services (U.S. Department of Labor June 5).

The online toolkit helps workers understand the important decisions they need to make before retirement and includes a timeline for retirement planning--what to do starting at age 50  through age 70 1/2. You'll find general guidance about savings plans, Medicare, and prescription drug coverage, as well as Social Security what-if's. The toolkit includes links to a variety of publications and interactive tools, many available in Spanish, on topics ranging from pensions to elder rights and protections.

The online toolkit comes at a good time. Average Americans are no better prepared for retirement than they were in 2009, according to a study released in early June by consulting firm McKinsey & Company (MarketWatch June 6). On a scale of  one to 100, where 100 indicates you could sustain your preretirement standard of living, the national average score stands at 64. That means you could afford to retire only if you cut back on essentials like food, housing, and health care.

Data from the SSA confirm we're off track. More than half (53%) of married couples and three-fourths (74%) of unmarried retirees receive at least half of their income from Social Security. Worse, nearly a quarter of married couples and almost half of unmarried retirees rely on Social Security payments for at least 90% of their income.

Before you run the numbers for your retirement plan:

  • Create a retirement budget. Identify expenses you may incur in retirement, including travel, hobbies, mortgage, property taxes, gifts, education expenses for you or family members, and health care, to name a few. List all sources of income, including a traditional pension if you're lucky enough to have one.
  • Plan for a shortfall. Social Security was never intended to cover 100% of retirement needs, so personal savings will need to make up the difference. As a general rule, you need at least $15 to $20 in savings to cover each dollar of the annual shortfall between your income and your expenses, according to SSA. For example, if your projected retirement expenses exceed Social Security and pensions by $20,000 a year, you might need a nest egg of $300,000 to $400,000 to bridge the gap.
  • Use several different online retirement calculators. Each has its own input requirements and assumptions. Check out the Ballpark E$timate, which is also available through the App Store, and AARP's retirement calculator.
The retirement toolkit is available on the DOL website at dol.gov; type "retirement toolkit" in the search bar.

For more information, read "Who Goes First? For Couples, Retirement Is All About Timing" in the Home & Family Finance Resource Center.

H&FF Radio: How To Talk About Death And Finances

 Permanent link
WASHINGTON (6/21/13)--This week Home & Family Finance Radio tells you how college-bound freshmen should spend their summers, and helps prepare you for difficult conversations about money and death.

In this episode, which you can listen to on the Internet, host Paul Berry, Washington, D.C., journalist and broadcaster, discusses these topics with special guests:

  • "10 Tips for Incoming Freshmen." Jeremy Hyman, co-author of a weekly education column for US News and World Reports and the "The Professors' Guide Series" of books, Fayetteville, Ark., shares steps college-bound students can take this summer to prepare for their first semester of higher education.
  • "Aging, Finances, and Candor." Ted Beck, president of the National Endowment for Financial Education, Denver, points out that seven of 10 adults in the U.S. say they have difficulty communicating with aging family members about their financial decisions. Beck offers advice about how to approach this crucial subject.
  • "The Most Difficult Conversation." Samira Beckwith, CEO of Hope HealthCare Services, Fort Meyers, Fla., talks about "end of life etiquette" and how to speak with dying friends and family members.
Home & Family Finance is a resource center for personal finance information at the Credit Union National Association. The radio show is sponsored by CO-OP Network, the national credit union ATM network; Cabot Creamery Cooperative, maker of award-winning cheddar; and the Defense Credit Union Council and member credit unions, serving those who serve the country worldwide.

Home & Family Finance airs Sundays at 3 p.m. ET on the Radio America Network. The show also is carried on American Forces Radio Network. The one-hour program devoted to consumer finance issues is brought to you by America's credit unions and their 95 million members, and is presented by CO-OP Network.

CUNA and Radio America are podcasting Home & Family Finance through iTunes, Podcast Alley, Odeo, and other popular podcast library sites, as well as on Radio America and CUNA's websites.

For related information, read "Two Surveys Show That Americans Need Financial Overhaul" and "Elders Are Easy Targets for Scams" in the Home & Family Finance Resource Center.

Prepare To Curb Health Care Expenses In Retirement

 Permanent link
OAKBROOK, Ill. (6/18/13)--Today's preretirees can expect to live longer than those of previous generations--and with more serious illnesses and chronic conditions like high cholesterol, high blood pressure, and obesity. This trend will be costly (Advocate Health Care June 9).

According to Urban Institute findings, you can plan on spending about 30% of your income on health care expenses in retirement. Will you be able to afford the care you'll need?

Your planned-for Social Security and pension benefits might not be adequate, health and vigor likely will decline, Medicare won't cover long-term support and services--in short, life could get a lot harder.

For many, one solution to not having saved enough for health care in retirement is to stay in the work force longer. But what if you get sick and have to retire? If you're not at least age 65 and covered in part by Medicare, this could seriously deplete your savings.

Even if you retire early and keep your health, it's a double whammy: A new report by the Health Care Cost Institute finds that early retirees will pay even more dearly for health care. The report estimates costs at $146,400 for someone age 65 who lives 20 more years, and $372,400 for someone retiring at age 55 and living 30 more years.

Here's how you can prepare today to afford health care in retirement:

  • Stay healthy. It's never too late to quit smoking, watch your diet, get enough sleep, and exercise. Start small, bankroll your successes and build from there.
  • Educate yourself about health issues. Get regular checkups and ask questions. Take advantage of the many online forums and organizations devoted to different health concerns.
  • Purchase health care insurance wisely. If you have choices, carefully evaluate each health care plan available to you. Look for ways to save on premiums in your region. Investigate your insurance options ahead of the rollout of online insurance exchanges in October by visiting the federal government's website, HealthCare.org.
  • Save on health care costs. Use generic drugs when possible and weigh the pros and cons of recommended tests and procedures. Shop for high-quality, low-cost providers.
In addition, find ways to save and invest more money for retirement, now. Consider starting a health savings account (HSA). A high-deductible plan with a health savings account could save you a lot of money if you're single and rarely go to the doctor. For related information, read "Medigap Helps Pay Out-of-Pocket Costs" in the Home & Family Finance Resource Center.

Father's Day, High Cost Of Internet On H&FF Radio

 Permanent link
WASHINGTON (6/14/13)--This Father's Day Sunday, Home & Family Finance Radio imparts some paternal advice, dissects the high-cost of American Internet, and ponders if the stock market's recent highs are sustainable.

In this episode, which you can listen to on the Internet, host Paul Berry, Washington, D.C., journalist and broadcaster, discusses these topics with special guests:

  • "Father's Day Lessons." Tim Hoch, author of the book "50 Rules for Sons," Forth Worth, Texas, shares some fatherly wisdom.
  • "Most Expensive Internet in the World." Steve Slon, editorial director for the Saturday Evening Post, Indianapolis, explains why Americans pay more for the Internet than most other developed countries.
  • "Riding the Volatile Market." Michael Farr, president of investment firm Farr, Miller & Washington, Washington, D.C., looks at the stock market's recent record highs, and tells you if now is a good time to invest or disinvest.
Home & Family Finance is a resource center for personal finance information at the Credit Union National Association. The radio show is sponsored by CO-OP Network, the national credit union ATM network; Cabot Creamery Cooperative, maker of award-winning cheddar; and the Defense Credit Union Council and member credit unions, serving those who serve the country worldwide.

Home & Family Finance airs Sundays at 3 p.m. ET on the Radio America Network. The show also is carried on American Forces Radio Network. The one-hour program devoted to consumer finance issues is sponsored by America's credit unions and their 95 million members, and is presented by CO-OP Network.

CUNA and Radio America are podcasting Home & Family Finance through iTunes, Podcast Alley, Odeo, and other popular podcast library sites, as well as on Radio America and CUNA's websites.

For related information, read "May Financial Fitness Challenge--Benchmarks Help Gauge Financial Progress" in the Home & Family Finance Resource Center.

No-Mortgage Goal Not For Every Retiree

 Permanent link
NEW YORK (6/11/13)--Not long ago, people gauged retirement readiness by their mortgage-free status. This stipulation no longer always holds true. In 1989, only 26.4% of householders retired while still carrying a mortgage. In 2007, that number rose to 46.5%, according to the most recent numbers from the Federal Reserve's Survey of Consumer Finances (businesstime.com May 28).

Paying off a mortgage has pros and cons, and the best decision isn't the same for everyone. If you won't have peace of mind until our mortgage is paid in full, paying it off might be the answer for you. Your living expenses will be cut and you'll have a resource in your home equity.

On the other hand, low interest rates can make continuing to pay a mortgage and investing surplus money elsewhere an attractive option for some. You might see a greater return following this route.

"Paying off a mortgage is advisable only if these four preconditions are met," said Steve Rick, the Credit Union National Association's senior economist.  The pre-conditions are:

  • You've paid off all high-interest rate consumer debt. You're likely paying a much higher interest rate on credit card debt than you are on your mortgage. Put extra money toward credit card debt instead of paying extra on your mortgage to see an instant return. While paying off card debt, you still can deduct mortgage interest if you itemize--there's no tax break on credit card payments.
  • You've built an emergency savings fund equal to six months of living expenses. You probably have no intention of tapping retirement savings to pay off your mortgage, but you could end up doing so if you don't have a significant emergency fund. Also keep in mind that you'll need income in retirement to pay for other expenses. Experts say your best bet is to plan to retire at or as close to your preretirement income as possible. You could end up house-rich and cash-poor if you're not careful.
  • You've maxed out retirement account contributions. If you only have a few years left before retirement, it's your last chance to fund retirement accounts. For 2013, you can contribute $23,000 to a 401(k) and $6,500 to an individual retirement account if you're age 50 or older. If paying extra toward a mortgage to get it paid off by retirement is keeping you from contributing the max, not paying your mortgage off early could be the better choice (Kiplinger May 2012).
  • The after-tax return on available investments is less than the after-tax cost of your mortgage. With interest rates on bonds and share certificates/certificates of deposit (share certificates of deposit) expected to be very low for the next few years, many mortgage holders will meet this precondition, Rick says.
For more information about mortgages, read the Financial Fitness Challenge "Catch the Refi Wave" in the Home & Family Finance Resource Center.

Productivity Advice, End Of Money On H&FF Radio

 Permanent link
WASHINGTON (6/7/13)--This Sunday Home & Family Finance Radio ponders a future without money while helping you find a little more of it in the present during a rebroadcast of a show that originally aired last year.

The show, which you also can hear later via the Internet, features Paul Berry, Washington, D.C., journalist and broadcaster, discussing these topics with special guests:

  • "Personal Productivity Secrets." Maura Thomas, Austin, Texas, a 20-year personal productivity leader, and founder and chief trainer of Regain Your Time.com, talks about managing the details of life and work.
  • "The End of Money." David Wolman, Portland, Ore., a contributing editor at Wired and author of "The End of Money"--described by one reviewer as "a tidy history of money and its discontents, [as well as] a travel story"--considers the future of cash and how it will affect your wallet.
  • "Find More Money." Susan Tiffany, certified credit union financial counselor and director of consumer periodicals, Credit Union National Association, Madison, Wis., suggests ways to discover money in your budget for saving and paying off debt.
  • "Too Late to Travel and Save This Summer?" Susan Tanzman, owner and president of Martin's Travel and Tours, Los Angeles, offers ideas for cost-effective summer travel.
Home & Family Finance is a resource center for personal finance information at CUNA. The radio show is sponsored by CO-OP Network, the national credit union ATM network; Cabot Creamery Cooperative, maker of award-winning cheddar; and the Defense Credit Union Council and member credit unions, serving those who serve the country worldwide.

Home & Family Finance airs Sundays at 3 p.m. ET on the Radio America Network. The show also is carried on American Forces Radio Network. The one-hour program devoted to consumer finance issues is brought to you by America's credit unions and their 95 million members, and is presented by CO-OP Network.

CUNA and Radio America are podcasting Home & Family Finance through iTunes, Podcast Alley, Odeo, and other popular podcast library sites, as well as on Radio America and CUNA's websites.

For more information, read the "July Financial Fitness Challenge--Find More Money" and "Make Tracks: Traveling by Train for Your Next Trip" in the Home & Family Finance Resource Center.

Time to Sell? Home Prices Surge

 Permanent link
WASHINGTON (6/4/13)--If you're considering selling your house, now is the best time in years to do so. This week the Standard & Poor's Case-Shiller home price index reported that housing prices posted their biggest annual gain in seven years, jumping 10.9% in March (Washington Post May 28).

The last time home prices rose so quickly was in 2006, but most analysts aren't worried about another housing bubble. None of the 20 housing markets tracked by Standard & Poor's are back to their peak levels, even those that have climbed 25% from their previous lows (Wall Street Journal May 28). Nationally, home prices are around their 2003 levels.

Driving the surge is a mix of factors, including:

  1. High rents and low interest rates. Mortgage rates have hovered around all-time lows, while in many markets the cost of renting has been comparatively high.
  1. Increased consumer confidence. The private research group Conference Board's sentiment index showed that consumer confidence in May was the highest it's been since 2008 (Bloomberg May 28).
  1. Tight supply. In April there were 2.16 million homes on the market, the fewest for any April since 2001, according to the National Association of Realtors (Bloomberg May 23).
What this means is that your house should sell quickly and at a good--if not at an all-time high-- price. Strong housing markets are seeing multiple offers for the same property, a sign of boom times for real estate. Glenn Kelman, CEO of the online real estate brokerage firm Redfin, said earlier this year in The New York Times that "spring is the Super Bowl of annual real estate sales." June is the month for the highest number of signed contracts.

So if you're thinking about selling, list now, while the weather is good and people are looking to buy. Make sure your property is spic and span, freshly painted inside, and attractive from the curb. Then ask a real estate agent for a market review to help set a price that will move your listing.

Another driver is that signs indicate interest rates for mortgages are rising, potentially dampening demand. The Mortgage Bankers Association reported that interest rates on fixed 30-year mortgages rose from 3.78% to an average 3.9% last week amid fears that the improving economy would spur the Federal Reserve to raise borrowing rates (Reuters May 29). It was the biggest single jump in mortgage rates in 14 months.

For related information, read "Move or Remodel: What Calculation Works for You?" in the Home & Family Finance Resource Center.