Category: Blog

Did you know that delaying the age at which you receive your Social Security benefits could give you a nice increase in benefits rather than receiving 100 % of your Social Security Benefits at age 66?

Yes, if you waited until age 68 you can multiply your Full Retirement Benefit by 116%.  If you waited until age 70 you can multiply your Full Retirement Benefit by 132%. Half of all Americans retire between age 61 and age 65. Read the Money Magazine article below for more information.

Despite a severe retirement income crisis, many Americans still stop work too

About half of Americans call it quits between ages 61 and 65 while 18% retire even earlier, according to the data shown here from LIMRA Secure Retirement Institute. By age 75, 89% of Americans have left the labor force, LIMRA says.

The retirement statistics no doubt include some people who can’t find work or who can’t work because of health problems. Still, early retirement can mean an income squeeze.

Along with stopping work early, most Americans begin collecting Social Security before their full retirement age, which is 66 for many and rises to 67 for those born after 1960, LIMRA says in a recent report.

The percentage of those claiming Social Security early is declining. That’s generally good news because monthly benefits rise by roughly 6.5% to 8% a year between ages 62 and 70. Still, in 2014, 57% of men and 64% of women took the benefit early, LIMRA says.

Half of leading-edge baby boomers, those ages 61 to 69, have fully retired and about 15% of the U.S. population is now finished with work. Among this group, the presence of a traditional pension or retirement plan is often what separates those considered income-rich from those who are not, LIMRA found.

Retired Americans receive $1.3 trillion in income. The vast majority of this income comes from two sources: Social Security (42%) and traditional pension and retirement plans (30%). Traditional pensions remain fairly common for those over 75 but are virtually nonexistent for those under 34, LIMRA found.

Some 41% of retirees have annual income less than $25,000, and of those, only 21% receive income from a pension or retirement plan. Meanwhile, of retirees with income over $50,000 a year, about 80% draw from a pension or retirement plan.

To get a picture of how severe the retirement income crisis is—and why more Americans should consider working longer and delaying Social Security—LIMRA looked at total savings. U.S. households own $31 trillion of investable assets. That’s an average of $253,200 per household. But most of that is owned by the wealthy. The median holding is just $17,500 and three in four American households have saved less than $100,000.

Lite Brite

Crisp black paper in palpable suspense stretched out eyes ready for creation. We found its joy in Lite Brite, in clowns and trains of rainbows, where the warm buzz of the lamp turned to magic in our hands; in the clink and clank of Lincoln Logs; in the tap-tap-tap of Tinker Toys—a greenhouse, a tropic, a Hawaiian Delight of imagination, where flora flourished and fauna came to dwell.

Questions sprung across the twin hills of my cerebrum, flowers cheering each other, “Rise! Leap!”—not a one so inhibited that it would settle into abstinence. Silver vines wove a carpet of complexity, an unmyelinated beauty that, thanks to you, I never lost.

Tropical summer and Eskimo kisses—real kisses, too—felt as finger paints of freedom, and hugs squished like turtle box sand, the kind we made tunnels out of. Whistling raspberries that smelled like lipstick, cologne, and little boy smiles, you wrapped me in bear blankets and garden hose showers.

We spend the day on Lite Brite. Splashes of color tingle in my heart like the lamp tingles on my skin. Your smiling face feels peg-glow good. The world we create looks small, but happy. Outside, you can find Doodle Bugs and grass blade whistles. Tiny things fit into your hand, you see, but they fill up your heart like Meme’s breakfasts fill your tummy.

Bacon crackles on the stove; I watch it sizzle, legs kicking free, held up by little boy arms strong from when we wrestle. We sample grapefruit, pucker, and laugh. At bath time, we make George Washington Hairdo bubbles, and belly buttons have magic, like Treasure Trolls. You bring every moment the most wonderful magic in the world.

You tuck me up in a taco roll (all the way around), and I tell you: I never want to stop needing you.

I recently read an article in Employee Benefit News, titled “Millennials distrupt traditional benefits for modern priorities”

The following are some excerpts and comments from that article:

The percentage of young workers who understand insurance products is well below that of older workers. As I read the article I pondered a number of potential reasons for the gap in understanding. That would be for further discussion. Perhaps more importantly let’s consider what can we do to tip the scale back in the other direction. From my perspective one–on–one counsel from people who know, is ideal.  There is so much information that is so readily accessible with a few clicks and swipes. However, if you want a short cut that helps to decipher the myriad of available choices, sit down and TALK with knowledgeable professional.

The article goes on to say:

A common problem millennials have reported encountering is not understanding the benefits being offered to them and how important they might be to their future. According to MetLife’s study, 52% of millennials understand life insurance, compared to 69% of boomers, and more than one-third of millennials don’t understand their basic medical coverage. It is not uncommon to see employees click a “Waive the Benefit” without counsel or understanding as to WHY they are waiving the benefit. By the same token, the same employees that end up having a brief discussion regarding the merits of that benefit choose “YES- Elect the Benefit”. Face to face discussions are paramount for most employees to understand the relationship between Term Life and Permanent Life Insurance so they have adequate information to make a positive decision for them and their families. A decision today literally could impact the immediate family and potentially even generations to come.

Mentioned in the same article:

Carlos Hernandez, VP of strategic alliances with Acclaris, says the main thing employers need to keep in mind when offering these benefits is to just keep it simple. “Employers are trying to structure programs with more instantaneous values,” Hernandez says. “A benefit program like an HSA is a great one because it will support someone who is 20 years old and just graduated and somebody who is 60 years old and is ready to walk out the door.” Regardless if you are 20 years old or 60 years old, take the time to understand how a High Deductible health insurance plan combined with an HSA (health savings account) could be good for you. The immediate tax advantages can add additional value to a more cost effective and cost controlled Health Insurance Strategy.

Give some consideration to the following:  Slow down, sit down and have a discussion regarding your employee benefit decisions.

The TRS School District Open Enrollment period for Employee Benefits is officially closed.  Certainly, it is satisfying to assist employees making all important benefit decisions for the upcoming school year. By the same token, it is somewhat disheartening to know that more than 75% of the employees do not come in for individual consultation. One may assert that those employees do not have changes that need to be made. To the contrary, approximately 30% of those that do come for a review make a change that they did not specifically intend to make when they walked in the door. Even for changes that employees intend to make, often they are assisted with the counsel of a qualified enrollment specialist.

 It is not uncommon that well educated people neglect important benefit decisions/changes simply because they do not take the time to consider significant changes that may have taken place in their lives. Are you fiscally responsible when it comes to your benefit decisions?

 It pays to review, just ask these people :

 I met with an administrator that had continued to pay for the most expensive health insurance plan even though his children were grown and there was no longer a need for that rich benefit plan. This employee and his spouse seldom went to the doctor.  Another employee said “ I do not go to the doctor very often”.  So my question was “why pay an extra $121 a month just to have access to a Co-Pay plan ?”

 Unfortunately, a young mother never took advantage of a Dependent Care Flexible Spending Account. After 8 years of child care expense, she knows that she could have saved thousands of dollars on her income tax if only she had utilized the Flex.

 Many times one does not think about how they will pay their bills if they are hurt or sick and can’t work. If they don’t have disability income protection they are completely self insured.  Perhaps the employee doesn’t need the 14 day elimination period and the maximum benefit. They may be well served to mitigate some of that risk by taking a 45 or 90 day elimination period with a benefit less than the max available based on their income. I would say “some is better than none”! Some employees have alot of sick leave built up….and are well served with the longer waiting periods.

 When it comes to life insurance so many rely only on what the employer provides. Term Life rates will continue to increase and eventually coverage will terminate. With Permanent Life insurance, rates are level, can be guaranteed for life and the death benefit is guaranteed level for life.  Ultimately, Permanent Life insurance will pay an income tax free death benefit if the premiums are paid and the policy is in force. Permanent means “until death do us part”!

 In short, often it pays for employees to review their benefits and long range plans at least annually!!