Monthly Archives: May 2018

How Can Older Workers Stay in the Game?

So, you retired, and a lot of your friends retired. It didn’t take long to see how difficult it is to retire without enough financial resources. No pensions. No large 401k to cash out. What can you do about it? Besides the usual list which may include scaling down your lifestyle,  you can take out some of your home equity with the use of a HECM mortgage to provide additional cashflow. Pay off the mortgage and reduce the overhead.

But even with those adjustments, some will consider staying in — or going back into — the workplace. There are challenges initiated by the changing workplace as evolving high tech skill sets overwhelm those not adequately trained.

Here are some strategies to consider — recently suggested by an article in the Wall Street Journal. These strategies help veteran employees stay current and valuable as workplaces become younger and more tech-focused.

By  Sue Shellenbarger

Updated May 22, 2018

Do your colleagues at the office seem to be getting younger?

It looks that way to the millions of older employees in industries being disrupted in the digital era and favoring younger more digitally savvy workers, such as tech, entertainment, retailing and media. As more workers in their 40s and beyond plan to delay retirement until their mid-60s, a growing number will have to hustle to reassert their value to their employers.

A core question older employees face: Would your boss hire you again with the skills you have now? Being able to answer yes takes some smart moves to keep your skills fresh, your attitude upbeat and your personal style up-to-date.

Waiting to act until a buyout offer or other rumblings of cutbacks surface at your company is too late. “You can’t wait until the axe is falling to get out of the way,” says Judith Gerberg, a New York City executive coach.

Networking with younger colleagues and showing curiosity about what they do can help you stay abreast of changes, says Ellis Chase, a New York career-management consultant and author. “You have to break through your comfort zone and talk to that 28-year-old hotshot. Seek her out and ask, ‘I’d love to learn more about this. Could you spend a half-hour with me? I’ll take you to lunch,’ ” Mr. Chase says.

Jeff Fuerst, 52

Jeff Fuerst, 52, spent eight years in his 40s as an inventory-management executive at Sears HoldingCorp. , the troubled retailer, in hopes of helping it turn around. He stayed abreast of technology and helped start a work-from-home program to help attract young recruits. As Sears continued to close stores, he kept his industry contacts fresh by attending meetings of professional groups.

In a transition initiated by one of those contacts, Mr. Fuerst left Sears three years ago for a position as a senior vice president at Integrated Merchandising Systems, a Morton Grove, Ill., merchandising and marketing agency. There, he’s learning e-commerce and digital-marketing technology, and he has since been promoted to chief logistics officer. “If you don’t react quickly to change, it’s very hard to keep up,” Mr. Fuerst says.

Forming ties and collaborating with colleagues at all levels is an important survival skill, Ms. Gerberg says. Make sure “you have somebody who, if your name comes up at a meeting to be fired, will say, ‘Oh no, that person is great. I’ve worked with them,’ ” she says. If your group is targeted for buyouts, having friends inside the company also improves your chances of transferring to a new assignment in a different unit.

Karen Alber, 54

Karen Alber, 54, continued to advance her skills and build new contacts during stints at three separate beverage and food companies in the past 15 years, enduring major cost cuts and restructuring threats and leaving voluntarily in each case. She earned certifications in a field that didn’t exist when she graduated from college in the 1980s—supply-chain management.

She joined professional groups and spoke at meetings. “I sometimes thought, ‘Really? I have to get on a plane and go to a conference?’ ” Ms. Alber says. “But then I did it anyway.” She took coaching courses because she enjoyed mentoring young colleagues.

She also volunteered for internal projects, including task forces for improving how work got done. She sometimes worried, “If I go on this team, how am I ever going to get my job back?” Ms. Alber says. But she learned valuable skills, including managing cross-functional teams and delegating work she couldn’t do herself, helping her advance to chief information officer.

Karen Alber, 54, stayed up-to-date in part by earning certifications in a field that didn’t even exist when she graduated from college: supply-chain management.

“It became her brand,” says Amy Ruppert, an executive coach who worked with Ms. Alber for years. “People knew, ‘You can throw Karen Alber into anything and she’ll run with it.’ ” Two years ago, Ms. Alber made a planned, voluntary move to a new career, co-founding the Integreship Group, a Chicago leadership-coaching firm, with Ms. Ruppert.

Many people face psychological roadblocks to learning new jobs or skills, says Andy Molinsky, a professor of organizational behavior at Brandeis University and author of a book on stepping outside your comfort zone. Older workers may feel resentful about having to stretch themselves when they’ve already worked for decades. Or they may think, “This doesn’t feel like me,” Dr. Molinsky says.

Some manage to venture into new terrain anyway, by developing a sense of purpose—a belief that making the effort is important for a reason you value deeply. Others manage to tweak, personalize or customize the way they move into new roles, so that they feel more comfortable, he says.

One way to do this, consultants and coaches say, is to develop your personal style. That doesn’t mean overhauling your wardrobe or appearance in an effort to look as hip as younger colleagues. “If you’re in your 30s and you have stubble, maybe it’s hunky. But if you’re 70 and you’ve got gray stubble, it looks like you’re homeless,” says Peter Cappelli, a management professor at the Wharton School and author of “Managing the Older Worker.”

New York image consultant Amanda Sanders advises choosing clothing and accessories that reflect current fashions, but making sure they also fit well and look good on you. Men can update their look by choosing trousers with tapered legs, leather shoes with double monk straps rather than laces, and contemporary glasses with tortoiseshell or colorful transparent frames. While an Apple watch suggests the wearer is tech savvy, “on someone older it looks like they’re trying to be young,” ​Ms. Sanders says. A​ better choice might be a classic watch with a leather band, she says. ​

Women should abandon outdated looks, such as a frumpy cardigan over a dress, in favor of a leather jacket or asymmetrical sweater, Ms. Sanders says.

Those whose hair is thinning can color it with highlights to lend more depth and thickness, she suggests. And gray hair is fine if it’s healthy and styled in a contemporary way, Ms. Sanders says. “Wear your age as a badge of honor,” she says. “If you believe it, they’ll believe it.”

SAVVY MOVES

To improve your survival chances late in your career:

If your area is a likely target for cuts, explore potential assignments in other units.

Look for problems you can solve for your employer to demonstrate your strengths.

Consider updating your wardrobe and hairstyle with help from a trusted adviser.

Participate when possible in off-hours socializing or charity events with colleagues.

Take the initiative to get to know younger colleagues with skills you don’t have.

Volunteer to help with training or onboarding programs for new hires.

Raise your hand for internal projects that will strengthen your network or skills.

Update your professional credentials via training or refresher courses.

Stay involved in professional organizations or your college alumni network.

WORK & FAMILY MAILBOX

Q: You wrote recently about employers replacing traditional one-desk-per-employee setups with unassigned desks and a variety of other spaces for meeting and socializing. What impact do these wide-open setups have on introverts?—M.S.

A: Losing your assigned desk can be especially jarring for introverts, who may feel the loss of a home base more keenly than others. Many also miss the predictability of sitting near the same people every day, employers and employees say. New hires in these freewheeling setups typically have to learn more new names and faces immediately.

Some introverts also benefit from being allowed to work from home or other private settings more often. Many employers provide this added flexibility as part of the transition to unassigned seating. These setups also typically include private workspaces for employees to settle down by themselves, focus on their work and think deeply.

Write to Sue Shellenbarger at Sue.Shellenbarger@wsj.com

Appeared in the May 23, 2018, print edition as ‘Reinvention in a Digital Era Stayin’ Alive.’

Those interested in a HECM should read through information on this website. Ask questions by calling Warren Strycker, a savvy upper aged veteran. See contact information under the “information” tab on the home page.

 

What can you do if you haven’t saved enough for retirement? (HECM it!)

Americans say this is their biggest financial regret; Is there a fix? (see editor’s note at the end of this story).

Taylor Tepper @TaylorTepper

May 16, 2018  in  Savings

Romona Robbins Photography/Getty Images

Brian Dooley wanted a recreational vehicle.

He and his wife, Brooke, liked to travel and didn’t want to leave their two cats and a dog behind. Brooke is a veterinarian. They were looking forward to cross-country drives to stay with family for weeks at a time, or just picking up and heading out into the country for a long weekend.

Four years ago, the then-San Antonio couple decided to plop down $20,000 in cash for their RV. The sum pretty much ate up their entire $25,000 emergency fund, but with no debt beyond their mortgage, Dooley, now 35, felt comfortable they could replenish it soon.

Ten days later, though, Brooke, 31 at the time, was diagnosed with breast cancer. After half a year of treatment, including chemotherapy and a double mastectomy, Brooke’s cancer was contained and removed. The couple had been able to replenish their savings in less than a year, even after paying $10,000 for an IVF-type procedure that wasn’t covered by insurance, to ensure their ability to one day have children.

“We learned the unexpected can happen, and an RV purchase is far from an emergency,” says Brian, who works in medical marketing.

Millions of Americans understand that lesson.

For the third consecutive year, according to a Bankrate survey, adults most regret not saving for retirement early enough – 18 percent of respondents – and not saving for emergency expenses (14 percent).

Debt was a secondary concern, with 1 in 10 respondents lamenting too much credit card debt and another 8 percent citing high student loans. Seven percent wish they saved more for their child’s college education, while 2 percent cite buying more house than they can afford.

Nearly a quarter said they regretted something else, and 15 percent had no financial regrets whatsoever.

While mild wage gains and rising housing costs have burdened Americans across the country, there exists no perfect moment to get serious about saving.

“Time is your greatest ally when saving for the future,” says Greg McBride, CFA, Bankrate chief financial analyst. “To workers of all ages, there is no better time than the present to increase your 401(k) contribution or fund an IRA.”

Saving in America

There are two savings crises among American households: short-term and long-term.

In the here and now, most adults do not have enough stowed away in a savings account to adequately protect them from going into debt, should disaster (lost job, health scare) occur.

Financial planners recommend an emergency fund comprising six months’ worth of essential expenses in a savings account. That’s about $23,000 for the average household living in a major metropolitan area, according to a recent Bankrate report.

How much does the average American have? Less than $4,000, according to Federal Reserve data, which is why 39 percent of adults wouldn’t pay from an unexpected $1,000 expense out of savings.

And then there’s retirement.

Half of working-age adults, according to Boston College’s Center for Retirement Research, may not be able to maintain their standard of living once they stop working.

Americans, as the latest Bankrate survey finds, simply are nervous about their lack of retirement savings. Just half of middle-income Americans own a retirement account, according to the Fed, with a median holding of only $25,000.

The figures are even more scary if you look at households helmed by someone between the ages of 55 to 64, or the decade before retirement. Only 60 percent of those Americans, who are about to be out of the workforce, are saving for retirement, with a median amount of $120,000. Financial planners estimate you need about 11 times your final paycheck to retire securely.

How you can avoid financial regret

“I’m not surprised the biggest regrets in your survey are about not saving enough,” says Chantel Bonneau, a San Diego-based Northwestern Mutual wealth management adviser and CFP professional. “So many are woefully behind schedule on savings.”

Bonneau sees two distinct problems among her clients who haven’t amassed adequate savings: incentives and anchoring.

Incentives: This issue revolves around the lack of a clear goal. What’s the point if you don’t have a story in your mind to account for why you’re saving? These clients may intellectually understand why saving is better for their finances than spending, but without a clear number in mind, they lose enthusiasm and focus.

“It’s just hard to get excited without a goal,” Bonneau says.

So, create a goal. Make it real. If you want to buy a house, label your savings account “down payment” and start building toward a specific number that will help you afford a home in your price range.

Anchoring: The other issue, especially for retirement, is not adjusting the amount of your savings when your income rises. Some of Bonneau’s clients contributed, say, $50 a month to an IRA when they were 22, but hadn’t increased their contributions as their incomes rose.

“People are locked in on numbers,” Bonneau says. “For instance, I just believe my cable bill should be $80 a month. I’m comfortable with that. The same thing happens with savings.”

The trick is to break yourself of that anchor. Fifty bucks may have made sense on your first salary but is insufficient later in life. In effect, you are living beyond your means by decreasing your savings rate.

Instead of thinking in terms of dollar amounts, then, use percentages. Get used to saving 10 percent of your pay in an employer-sponsored 401(k) including any match, or in an IRA.

You’ll have less to regret later in life.

This study was conducted for Bankrate via landline and cellphone by SSRS on its Omnibus survey platform. Interviews were conducted from May 2-6, 2018, among a sample of 1,004 respondents. The margin of error for total respondents is +/- 3.70% at the 95% confidence level. SSRS Omnibus is a national, weekly, dual-frame bilingual telephone survey. All SSRS Omnibus data are weighted to represent the target population.

So, what to do about it now? The HECM mortgage utilizes home equity to balance the budget in retirement when other income sources fail to cover deficits. Merton and others are now saying it will be the wave of the future in retirement planning. And, while not all those should be based on the numbers in this article, more are weighing in to recommend the HECM mortgage to clean up budget imbalances.

Consider the implications of the HECM mortgage as you browse this website.

Consider the implications of using it for yourself as you near your sixty second birthday by opening up dialogue with Warren Strycker, HECM veteran of many years. See Information tab on the home page for contact information. (https://gofinancial.net/home/)

Also, since many of you believe this is a bad decision, consider what the truth is vs the fake news you’ve been hearing by downloading this brochure for your consideration. (https://gofinancial.net/hecm-brochures/)

 

Life: The Long and the Short of It — Telomeres

AMARA ROSE MAY 7, 2018 

 “What we have done for ourselves alone dies with us; what we have done for others and the world remains and is immortal.”

—   Albert Pike

May is Older Americans Month, and in recognition of this year’s theme, Engage At Every Age, Americans are growing older than ever before. What’s their secret? Possibly telomeres.

What we learned from astronauts 

Telomeres — the protective endcaps of our chromosomes, which shorten over time as we age — appear to lengthen in space, a NASA study reveals.

Researchers compared a number of psychological and physiological factors affecting identical twin astronauts, one of whom spent a year in orbit aboard the International Space Station while his brother remained on Earth as a control. Testing confirmed that the off-planet brother returned to Earth with significantly longer telomeres.

While his telomeres shortened again after just a few days back on Earth, it begs the question: is living aboard a spacecraft the ultimate anti-aging tonic?

Ripe for disruption

It’s not just space that affects longevity; there’s a lot of health disruption happening right here at home. We may not be able to lengthen our telomeres (yet) but healthcare innovation has just taken a quantum leap forward: Amazon hired a geriatrician.

Isn’t that a bit odd? What does Amazon know that other businesses don’t?

According to MedCity News, “Healthcare — especially for seniors — is at its breaking point and is ripe for disruption. The old ways of doing things have not been working for patients or providers. That’s why the geriatricians who have been on the front lines are actually some of the most innovative minds who could shift the paradigm.”

Dementia without stigma

We’re also starting to remove the ignominy of memory loss. The inaugural “Dementia Village”, based on the pioneering Netherlands model, opened last month in Chula Vista, California. An adult day care center, known as Town Square, is a simulated town designed for reminiscent therapy, featuring everything from a 1959 car to a working diner and black-and-white movie theater.

While senior residences have seen the benefit of yesteryear-themed design, what’s intriguing about this dementia village is that it’s staffed with seniors, via a national home care franchise. They hope to scale the concept to 100 locations throughout the U.S.

Like Amazon hiring a geriatrician, having seniors support seniors makes perfect sense. Just as Japan is gearing up to care for its burgeoning number of older adults with Alzheimer’s through the concept of “dementia towns”, where residents take responsibility for seniors who need assistance rather than leaving this to immediate family or the medical establishment, dementia villages create a welcoming, immersive experience for elders who need memory care. And it’s stigma-free — inviting, even. The whole environment sounds quite appealing for any nostalgia buff!

For love of the game

For some seniors, working at what they love, whether it involves caring for their cohorts or ushering at a beloved ballgame, keeps those telomeres and the person they pilot in fighting trim to the very end.

That was the ticket for Phil Coyne, a Pittsburgh Pirates fan who retired in April just a few weeks prior to his 100th birthday after — wait for it — 81 years on the job, besting Elena Griffing’s 71-year record (of course, Ms. Griffing is almost a decade younger than Coyne, so she may catch up!)

Whatever their game, when elders love life, and when industry giants such as Amazon and the creators of Town Square continue to focus on the benefits of making senior wellness a priority, life for your reverse mortgage clients and prospects promises to be better than ever. Enjoy honoring your clients this May!

Home Equity can reduce debt and fill income gap

Debt of the Elderly and Near Elderly, 1992–2016

By Craig Copeland, Ph.D., Employee Benefit Research Institute

AT A GLANCE

Much of the attention to retirement preparedness focuses on asset accumulation in individual account retirement plans as well as the presence of defined benefit plans, but the other side of the balance sheet—debt—can potentially have a significant impact on the financial success of an individual’s retirement. Any debt that an elderly or near-elderly family may have accrued entering or during retirement can offset any asset accumulations, resulting in lower levels of retirement income security.

This Issue Brief focuses on the trends in debt levels among older American families with heads ages 55 or older (near-elderly families are defined as those with family heads ages 55–64 and elderly families are defined as those with family heads ages 65 and older), as financial liabilities are a vital but often ignored component of retirement income security. The Federal Reserve’s Survey of Consumer Finances (SCF) is used in this article to determine the debt levels.

Debt is examined in two ways:

 Debt payments relative to income.

 Debt relative to assets.

Each measure provides insight regarding the financial abilities of older American families to cover their debt before or during retirement. For example, higher debt-to-income ratios may be acceptable for younger families with long working careers ahead of them, because their incomes are likely to rise, and their debt (related to housing or children) is likely to fall in the future. On the other hand, higher debt-to-income ratios may represent more serious concerns for older families, which could be forced to reduce their accumulated assets to service the debt at points where their peak earning years are ending. However, if these older families with high debt-to-income ratios have low debt-to-asset ratios, the effect of paying off the debt may not be as financially difficult as it might be for those with high debt-to-income and high debt-to-asset ratios.

This study by the Employee Benefit Research Institute (EBRI) found various results about the debt holdings of families with heads ages 55 or older.

 A higher percentage of American families with heads ages 55 or older have debt, and families with the oldest heads are seeing the greatest increases. In 1992, 53.8 percent of families with heads ages 55 or older had debt and by 2010, 63.4 percent did so. This number continued to increase through 2016 reaching 68.0 percent. After 2007, the increase in debt has been most prevalent among the families with the oldest heads – ages 75 or older – where the percentage having debt has increased by nearly 60 percent (from 31.2 percent in 2007 to 49.8 percent in 2016).

ebri.org Issue Brief • March 5, 2018 • No. 443 2

 However, debt levels have decreased from their peaks in 2010, but the oldest families still have debt levels above their 2001 levels. The average debt amount for families with heads ages 55 or older was $82,968 in 2010, but this amount stood at $76,679 in 2016 (both amounts in 2016 dollars). Furthermore, debt payments as a percentage of income fell from 11.4 percent in 2010 to 8.2 percent in 2016. In addition, debt as a percentage of assets declined from 8.4 percent in 2010 to 6.5 percent in 2016. While the overall percentage of families with heads ages 55 or older having debt payments in excess of 40 percent of income (a common threshold for determining if a family has issue with debt) decreased in 2016, the percentage of families with heads ages 75 or older with debt payments in excess of 40 percent of income increased by more than 23 percent from 2007-2016.

 Housing debt has been driving the change in the level of debt payments since 2001, while the nonhousing (consumer) debt-payment share of income has held relatively stable since that time. Housing debt payments have been 1 to 3 times larger than those of nonhousing debt payments since 1992. In 2016, housing debt payments fell below both the 2010 and 2013 levels.

 Younger families, those with heads younger than age 55, have had a higher probability of having debt and higher debt payments as a percentage of income than older families. However, families with heads ages 55–64 have been more likely to have debt payments in excess of 40 percent of income than any other age group.

 While improving in many respects in the most recent years, the overall trends in debt are troubling as far as retirement preparedness is concerned, in that American families just reaching retirement or those newly retired are more likely to have debt—and higher levels of debt—than past generations, specifically those in the 1990s. Furthermore, the percentage of families with heads ages 75 or older whose debt payments are excessive relative to their incomes is near its highest levels since 1992. Consequently, more families that have elderly heads are placing themselves at risk of running short of money in retirement due to their increased likelihood of holding debt while in retirement.

**Editor’s Note: “At the ‘HECM TABLE’, debt is postponed and dealt with after you move, die or choose to pay it off. The debt itself is referred to as “non recourse” meaning the loan is tied to the house — not the owner — and never needs to be paid in his lifetime as long as the homeowner keeps his taxes and HOI paid up” says veteran mortgage professional, Warren Strycker. (See contact information at the home page under “information” — call with questions).

For those concerned about losing their inheritance, read https://gofinancial.net/2015/12/inheritance/ on this webpage. Those worried about losing their house, check out this tab on the home page: https://gofinancial.net/hecm-brochures/ Better yet, call Warren at 928 345-1200 (it’s probably quicker).

The rate of people 65 and older filing for bankruptcy is three times what it was in 1991

Turned down for a loan? Let us get you approved when other banks say NO!

 

CoreLogic: Home prices increase again; Spikes HECM Principal Limit

Western states see double digit increases.

(See editor’s note at the end of this article for impact on Reverse Mortgages)

Kelsey Ramírez

April 3, 2018

Home prices continue to surge, rising for their seventh consecutive month in February, according to the latest Home Price Index from CoreLogic, a property information, analytics and data-enabled solutions provider.

Home prices increased 6.7% across the U.S. from February 2017 to February 2018, and increased 1% from the month before, according to the report.

And this increase was even higher in western states, which continue to have hot housing markets, CoreLogic explained.

“A number of western states have had hot housing markets,” CoreLogic Chief Economist Frank Nothaft said. “Idaho, Nevada, Utah and Washington all had home prices up more than 11% over the last year.”

“With the recent rise in mortgage rates, affordability has fallen sharply in these states,” Nothaft said. “We expect home-price growth to slow over the next 12 months, dropping to 5% to 6% in Idaho, Utah and Washington, and slowing to 9.6% in Nevada.”

For the U.S. overall, CoreLogic’s HPI Forecast shows prices will slow to an increase of 4.7% by February 2019. California, on the other hand, will continue to surge, rising 10.3% year-over-year.

The CoreLogic HPI Forecast is a projection of home prices that is calculated using the CoreLogic HPI and other economic variables. Values are derived from state-level forecasts by weighting indices according to the number of owner-occupied households for each state.

An analysis of the country’s top 100 largest metros based on housing stock shows that 34% are now considered overvalued as of February, CoreLogic reported.

The market conditions indicator analysis categorizes home prices in individual markets as undervalued, at value or overvalued, by comparing home prices to their long-run, sustainable levels, which are supported by local market fundamentals, such as disposable income.

As of February, about 30% of the top 100 metros were undervalued while 36% were at value, the report showed.

“Family income is rising more slowly than home prices and mortgage rates, meaning that the mortgage payment takes a bigger bite out of income for new homebuyers,” CoreLogic President and CEO Frank Martell said. “CoreLogic’s market conditions indicator has identified nearly one-half of the 50 largest metropolitan areas as overvalued.”

“Often buyers are lulled into thinking these high-priced markets will continue, but we find that overvalued markets will tend to have a slowdown in price growth,” Martell said.

Editor’s note: The HECM benefit rises with the Principal Limit tied to home values — so this is good news for those ready to consider the HECM reverse mortgage now. If the market goes back down (as it did recently), less benefit is available. Don’t forget — this mortgage does not require payments in your lifetime as long as you keep taxes and homeowner’s insurance current opening up a great opportunity to reset your budget in retirement, says Warren Strycker, veteran HECM professional. Call 928 345-1200 for a HECM analysis to determine what these facts could mean to you. See “information” tab on home page for contact information.