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Annual Healthcare Enrollment Ahead
It’s that time of year again when healthcare costs tend to spike. According to a 2016 Commonwealth Fund study, healthcare expenses now make up over 10.1% of family budgets, a significant increase from just a decade ago. Despite this surge, healthcare costs are outpacing income, though the rate has slowed slightly. Without delving into politics, my aim is to help people navigate the healthcare landscape, ensuring they don’t settle for subpar coverage or go without altogether.
Healthcare Sharing Ministries
For many Americans, healthcare has become a significant expense in their budget, especially with the introduction of the Affordable Care Act (Obama Care), which led to skyrocketing health insurance premiums for millions who do not qualify for subsidies. However, a reasonably priced alternative exists within the rapidly growing sector known as healthcare sharing ministries.
The IRS is a Bad Business Partner
When you started saving in your 401(k)/403(b) plan, the thought of partnering with the Government likely never crossed your mind. However, that’s essentially what happened. Qualified retirement accounts (401(k), 403(b), IRAs) were initially attractive because tax brackets were much higher, with the top bracket at 70% and the median at 39%. Fast forward to today, with tax rates significantly lower, and very few retirees find themselves in a lower tax bracket. The catch? You don’t actually own all of your Qualified Retirement Account. After factoring in federal and state taxes, you might only have 70%-75% of its stated value.
Social Security Leveling- State Employees Beware!
I recently spoke with an NC State Employee who had worked for the State of NC for 30 years but was only 56. They had discussed retirement options with the State Retirement System and were under the impression they could start Social Security early. However, what they likely heard was about the state’s plan for those retiring before Social Security eligibility, where the state provides additional benefits early and reduces them when Social Security kicks in at age 62.
Let me ask a couple of questions
If you own a home do you have homeowner’s insurance? Of course, you do! If something major happens to your house you want to be able to replace it. In 2014, only 5.3% of all homeowners made a claim on their policy, including everything from fire to theft. Do you have automobile insurance if you own a car? On average, a person with automobile insurance files a claim once every 17.9 years, equating to a 5.6% likelihood. This insurance is typically required in most states. Now, imagine this scenario: If you were confronted with a 75% likelihood of encountering a $200,000 expense, and you had the option to purchase insurance to cover it, would you?
Eat Your Greeens
In my younger days, I worked at a summer camp. Those summers were some of the best times of my life! The comradery between the staff and the chance to serve as a role model for the kids made every...
Additional Retirement Planning Services
Over the past six years, my company has gained recognition as an expert in Social Security. Originally established to provide education, analysis, and consulting on Social Security, we’ve expanded our focus to address the broader spectrum of retirement planning needs. Over the last seven months, I’ve been deeply involved in retirement planning for an insurance company, which has highlighted the multitude of issues individuals face as they plan for retirement. As a result, we are expanding our company to better serve the increasing needs of those preparing for retirement.
January 2017 Newsletter
Firstly, Happy New Year! I hope 2017 brings you great success. After a break over Christmas, it’s time to delve back into work. With the inauguration of a new president next week, there’s a lot of speculation about how Social Security will fare in the near future. Articles on Facebook have been extreme, with some predicting doomsday scenarios and others envisioning a golden era. While it’s unlikely that either extreme will materialize, it’s essential to sift through the noise and stay informed.
The Runway
A few years back, at a conference, I came across an intriguing story about a commercial pilot taking a friend for a ride in his personal plane. After a delightful flight, they approached for landing, but the pilot chose to touch down right at the end of the runway, then taxied all the way back to the hangar. Puzzled, the friend asked why he didn’t land in the middle. The pilot’s response was profound: “You can’t use the runway behind you.”
Are You Coachable?
While watching a special on Olympic athletes, I was struck by one athlete’s response when asked about the difference between him and others who didn’t make it to the Olympics. Instead of boasting about his abilities, he attributed his success to being coachable. He emphasized that even small improvements could make a big difference in highly competitive fields.
Busy Week
This week kicked off with a series of three educational events, each aimed at empowering individuals with a better understanding of Social Security and retirement planning.
Is Social Security a Ponzi Scheme?
So, it happened again. While scrolling through Facebook, I stumbled upon a post about Social Security. Intrigued, I clicked the link and found myself disagreeing with some of the analysis presented. Attempting to engage in a constructive conversation in the comments section, I was met with resistance. Many seemed unwilling to understand or discuss potential solutions to the impending challenges facing Social Security.
What is Your Number?
I recently came across an article that emphasized the importance of reaching a specific savings threshold for retirement. While savings certainly play a crucial role in retirement planning, they often take a backseat to other financial priorities throughout life. What such articles often overlook is the significance of leveraging controllable factors in retirement planning. The timing and coordination of these resources can significantly impact the longevity of your assets.
What to expect when you are expecting… a cost of living increase.
Undoubtedly, one of Social Security’s notable features is the Cost of Living Adjustment (COLA). However, last year surprised many retirees as there was no COLA, meaning no increase in benefits. Despite rising expenses like groceries, healthcare, and insurance, the COLA calculation is tied to the Consumer Price Index for Urban workers (CPI-W), which doesn’t always reflect actual spending. This discrepancy has led to a loss of purchasing power for seniors, estimated at 23% since 2000.
Trip to Nashville
I recently returned from Nashville, TN, where I conducted an educational session for the Society of Financial Service Professionals. This diverse group comprises over 25 professionals including CPAs, attorneys, insurance agents, and financial advisors. My invitation was to enhance their comprehension of Social Security and improve their ability to educate clients on this critical topic.
Still Have Questions?
Need a little guidance from a CERTIFIED FINANCIAL PLANNER™? Get in touch and I will be glad to help you determine if we’re the right option for your needs —no obligation, no commitment.