3 Costly Social Security Mistakes That Women Make

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Retirement planning is an important part of long-term financial wellness. For women, the process can be especially fraught.

In general, women tend to make less money and live longer than men. This combination can lead to lower Social Security benefit payments and other issues.

Let’s take a look at some of the costliest Social Security mistakes that women might make.

1. Claiming Social Security benefits too soon

Deciding to take Social Security benefits too soon can be costly for men, too, but that negative effect tends to be amplified for women, particularly for single women and women in same-sex relationships or marriages.

Women usually have it harder than men when saving for retirement, as they have lower lifetime earnings and a longer lifespan than men, on average. For single women, these challenges are compounded by the absence of a significant other bringing in additional Social Security income — or any other type of retirement income.

Additionally, in some cases, women tend to have a lower level of confidence in their financial abilities than men.

With all of these factors, it can be especially smart for single women and women in same-sex relationships to put off claiming Social Security benefits as long as possible so the amount of their monthly benefit is higher when they do start receiving it.

2. Forgetting about your ex-spouse

If you were married and then divorced — and the marriage lasted at least 10 years — you might be eligible for benefits through your ex-spouse.

So, before assuming that you must rely solely on your own Social Security account, find out if you’d get a better monthly payment by claiming through an ex’s earnings record.

“If you’re currently unmarried and at least 62, and the ex is at least 62, you can claim spousal benefits,” says Russ Settle, with Social Security Choices, a site devoted to helping people decide when to begin claiming benefits.

Settle notes that your own retirement benefits at full retirement age must be less than one-half of your ex’s benefits. (When you claim ex-spousal benefits, he says, it will trigger a claim for your own benefits, unless you were born before 1954.) Even if your ex hasn’t applied for benefits yet, you can file a claim on the ex’s account, as long as you and the ex both are at least 62.

Settle points out one caution:

“Remarriage results in a loss of ex-spousal benefits.”

If your later marriage also ends, though, you again become eligible for the ex-spousal benefits.

3. Letting your spouse make a unilateral claiming decision

If you’re married, you’d like to think that your spouse has your best interests at heart. However, that might not always be the case, especially when making decisions about when to start claiming Social Security benefits.

A 2018 study from the Center for Retirement Research found that a husband can increase his wife’s survivor benefits by 7.3% each year by delaying claiming his benefits. However, the study says, many husbands don’t consider the impact that their age at claiming benefits can have on their wives’ future benefits.

Instead, many husbands tend to consider more immediate issues and decide to claim Social Security sooner. Even after being educated about the possible impact on their wives later, many husbands said they wouldn’t change their claiming age.

It’s a good idea to sit down with your spouse and talk about how to best manage when each of you should file a claim for benefits. It’s best to coordinate your retirement plans and your Social Security claims.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

12 Smart Tricks to Organize Every Room of Your Home

Woman organizing her home
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The late comedian George Carlin famously talked about “stuff” in what became one of his most epic stand-ups:

“This is my stuff, that’s your stuff … That’s all you need in life, a little place for your stuff. That’s all your house is: a place to keep your stuff.”

As we all know, stuff becomes a problem! We have too much stuff and need to find ways to keep it all organized. So, check out these hacks guaranteed to save time, space and money.

1. Organize your jeans with S hooks

Organizing jeans with S hooks
Parker Wallace / Money Talks News

How many years have you folded your jeans neatly on a shelf? That’s great, until you’re suddenly running late and looking for your favorite pair — and they all end up thrown on the floor as you make a mad dash to the door.

Metal S hooks are less than $1 each at the hardware store and fit perfectly on any clothing rack to hang jeans by their belt loops. Now, you can see every pair in your closet, and they don’t get that annoying crease from being folded. You can even hang them in order from the skinny jeans you haven’t worn since 1997 to the fat pants you’ve been meaning to donate.

Here’s a 40-pack of S hooks at Amazon.

2. Use a pegboard to organize jewelry

Necklaces hanging on wall.
Parker Wallace / Money Talks News

There’s nothing more frustrating than going into your jewelry box to pull out a necklace, only to find it’s in a tangled knot with 11 other necklaces. No one’s got time for jewelry drama like that.

Mounting a pegboard allows you to organize jewelry with hooks so you can hang each necklace individually, as well as ensuring your earrings always have a mate.

3. Stack bracelets on a paper towel holder

Bracelets
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Chunky bracelets can take up too much space in drawers or jewelry boxes, so stack them on the rod of a standing paper towel holder for easy access. Here’s one at Amazon.

4. Use pool noodles as tall boot shapers

Boots held up by swim noodles.
Parker Wallace / Money Talks News

Your tall boots will never slouch at the bottom of a closet again! Instead of shelling out money for expensive boot hangers, cut up a plastic foam pool noodle, slide the pieces into your boots and they’ll stand tall and perfectly in line.

While you can also buy these pool noodles at Amazon, you can often find them for a buck at the dollar store.

5. Roll up your tanks and tees

Organized teeshirts
Parker Wallace / Money Talks News

Even if you fold tank tops and T-shirts neatly, it may take some digging to find the one you’re looking for. Rolling them up like little sushi rolls not only is a space saver, but it also allows you to easily reach for the one you want because they’re not piled on top of one another.

To get these orderly rolls, simply fold a shirt in half lengthwise, fold in half again and roll it up.

6. Use a shower liner with pockets to organize toiletries

Shower curtain organization
Parker Wallace / Money Talks News

A single shower rack doesn’t usually have enough room for multiple shampoos, conditioners and all those bath and beauty products you have piled up, spilling into the tub.

A shower liner with pockets is an easy solution that will keep your products organized and out of sight after you hang a shower curtain in front of it. Here is one at Amazon.

7. Organize makeup brushes in jars of coffee beans

Makeup brushes in a stand
Parker Wallace / Money Talks News

Dig those makeup brushes out of the bottom of your makeup bag and keep them cleaner and more organized — with coffee beans!

All you need is a container filled with some beans, and your brushes will stay standing and separated. Bonus: If you run out of java in the kitchen, you’ve got some reserves!

8. Transform a junk drawer with small plastic bins

Organized vanity drawer
Parker Wallace / Money Talks News

Instead of blindly fishing through whatever you threw into your bathroom vanity drawer, keep items separated with small plastic containers. Secure each container with a small amount of museum putty on the bottom to keep it in place.

9. Put a clothes rack by the dryer for a no-wrinkle finish

Laundry
Parker Wallace / Money Talks News

As soon as your clothes are dry or almost dry, having a rack nearby to hang up shirts and slacks makes it easier to go from dryer to closet — as well as a way to keep clothes from getting wrinkled by being tossed in a laundry basket.

10. Use a silverware tray to organize office supplies

Office drawer
Parker Wallace / Money Talks News

Still looking for those batteries you bought not too long ago? Silverware trays are a great way to keep office drawers organized with spaces for household essentials, from tape and stamps to chargers and pens.

11. Display kitchen counter must-haves with a cake stand

Tray organizer
Parker Wallace / Money Talks News

A decorative cake stand can be an attractive way to organize utensils, salt and pepper shakers, and all of your kitchen counter odds and ends in one place.

12. Use Mason jars in the pantry

Items in mason jars
Parker Wallace / Money Talks News

No more toothpicks falling all over the kitchen floor when you have a miniature Mason jar to keep them in one place! Since Mason jars come in so many convenient sizes, you can use them to organize all of your loose pantry products, from straws to spatulas.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

10 Bad Money Habits That Are Robbing You Blind

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Developing good habits helps us focus on things that need our attention most.

But as you work to get your financial life on track, you’ll probably find old, counterproductive habits undermining your progress. Some of them worked once, but now they’re holding you back. Others have always been bad.

Dropping bad money habits makes it easier to power up your financial life. Following are some bad money habits and tips for ending them.

1. Carrying a credit card balance

Carrying a balance on a credit card is like walking down the street with a hole in your wallet and letting money leak out.

Here’s why: Suppose you are paying down a $5,000 balance on a card charging 15% interest. If you only pay the minimum amount each month, it’ll take decades to pay off the debt and cost you thousands of dollars in interest.

Build a better habit: Devote every spare penny to getting rid of credit card debt. If you have other pressing debts, make a plan for dealing with all of them. For more tips on avoiding debt, check out “7 Easy Ways to Stay Out of Debt.”

Keep the balance from building again by making a new habit of paying off the entire bill every month — no exceptions ever.

2. Failing to fund a retirement plan

There are compelling excuses for putting off saving for retirement. But none of those excuses will matter if you reach retirement age with little saved. And, if you don’t take advantage of your employer’s matching contributions to a retirement plan, you’re passing up free money every month.

Build a better habit: Start paying close attention to your retirement savings. If you can’t significantly increase the monthly contribution you make to your plan immediately, increase it by 1% a month. Once a year, check the performance of your investments and rebalance your portfolio.

3. Not shopping for monthly services

Hopefully, you comparison-shopped before signing up for insurance policies. And we trust you did the same thing with phone, internet and cable services.

But you might be missing savings if you’re not checking prices again every year.

Build a better habit: Put some energy into improving your financial life. Once a year, spend 30 to 60 minutes price shopping for monthly services. To make it easy, keep a list with each company’s name, your account number and your monthly payment amount.

If it seems you’ll never get around to doing this, consider contacting BillCutterz, a service that negotiates on your behalf to get discounts on your monthly bills. Here’s a report on how it works.

4. Paying for cable or a landline phone

Cable TV prices are going nowhere but up. Free and cheaper alternatives to cable make experimenting worthwhile. But will you get out of your rut and try something new?

Build a better habit: Before trying a change, record your viewing habits for a week or two to see how and if you’re using the services you currently have. If streaming seems like a legitimate option for you, check out “13 Streaming TV Services That Cost $20 a Month — or Less.”

Ditto for your landline telephone. If you’re able, drop the landline and use mobile phones only. If that seems too radical, refrain from using the service for one month — or even just a week — while you check out alternatives.

5. Ignoring coupons and deal sites

If you aren’t using coupons and checking daily deal sites, you’re spending too much. However, you still need to exercise discipline when bargain shopping, so you don’t sabotage good intentions with impulse buys.

Build a better habit: Tackle bad habits in small bites. Try just one deal or coupon site. Money Talks News’ deals page, for example, has new sales and coupons every day relating to clothes, shoes, electronics, tools and more.

6. Playing investing too safe

Safe investing is important. But there’s safe, and then there’s too safe. Keeping all your money in no-risk accounts means inflation will rob you of spending power slowly but surely.

Build a new habit: Don’t break all your bad habits at once. Pick one and focus. For instance, make managing your investments a priority. Money Talks News founder Stacy Johnson offers some tips for getting started in “Ask Stacy — How Do I Invest in a Mutual Fund?”

7. Getting hooked on lattes

That $4 latte is killing your budget. One such latte each workday adds up to $20 a week — potentially $1,040 a year. If you tip a dollar each time, you’re spending $1,300 a year. Surely, there’s something you would rather do with that $1,000.

Build a better habit: Substitute new habits you enjoy for the old ones. A latte is a way of treating yourself, so find treats that don’t bust your budget.

8. Living without an emergency fund

If you don’t have an emergency fund, your life is a high-wire act with no safety net. Emergencies are inevitable. Life is full of them.

Build a better habit: Make a commitment to change. Write down your pledge and put it where you’ll see it. This will allow it to reinforce your resolve.

Commit and watch your savings build. If necessary, take on a few hours of extra work each week, whether it’s overtime at work or watching a neighbor’s dogs. For more tips, check out “9 Tips for Starting an Emergency Fund Today.”

9. Buying retail

Paying retail markup is like setting a match to a pile of cash. Smart buyers find ways to avoid doing that.

For example, a new car’s value drops fast the minute you drive it off the dealer’s lot. So, buy one that’s gently used instead.

Build a better habit: If you feel pressured to keep up with your friends or neighbors, ask yourself what that’s costing you. Stay out of malls and brand-name stores except when researching products. Read up on prices online so you know a good price when you see it.

And check out this post: “41 Things You Should Never Buy.”

10. Using shopping as entertainment

Perhaps you know people with compulsive shopping habits. Maybe you are one of them. Spending creates a high that’s addictive, severely damaging your budget and the financial security of your family.

Build a better habit: Try a spending fast. Remove your name from catalog lists, stay out of stores and hang out with friends whose idea of fun doesn’t include shopping.

Check out “11 Tips and Tricks That Will Keep You From Overspending” for more tips.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

The Top 5 Reasons Seniors Stay Frugal in Retirement

Accountant
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Countless workers scrimp and save for years with the goal of enjoying a comfortable retirement. Many of those folks do not abandon their penny-pinching ways once their golden years finally arrive.

Surprisingly, fear of running out of money is not the No. 1 factor that drives retirees to stay frugal, according to the Employee Benefit Research Institute’s (EBRI’s) Spending in Retirement Survey.

Instead, the survey — which asked 2,000 individuals ages 62 to 75 about their spending habits and their situation at and during retirement — found four more-common reasons that retirees keep their wallets shut.

The five reasons the retirees most often cited for not spending down assets are:

  1. Saving assets for an unforeseen cost later in retirement — 38%
  2. Feeling that spending down assets is unnecessary — 37%
  3. Wanting to leave as much as possible to heirs — 33%
  4. Simply feeling better when account balances remain high — 31%
  5. Fear of running out of money — 27%

Among these retirees, the average amount of current financial assets was $200,000, with a median of $75,000. More than two-thirds — 69% — said their standard of living is the same or higher than it was when they were working, and 61% believe their spending is appropriate for what they can afford.

The power of a fat nest egg should not be underestimated. Among survey respondents, 64% said saving as much as possible leaves them feeling happy and fulfilled. That finding seems to support recent research that has revealed that — contrary to common folk wisdom — having more money does indeed make people happier.

In fact, the retirees in the EBRI survey said they wish they had saved more for retirement. Just 18% said they saved more than was needed, while 46% reported saving less than they needed in retirement.

Saving for a great retirement

In life, it’s smart to learn from the wisdom of those who are in the place today that you are headed toward tomorrow. If many of today’s retirees wish they had saved more, chances are good you will feel the same way when you retire.

So, now is the time to begin building your retirement nest egg. The Money Talks News course The Only Retirement Guide You’ll Ever Need can get you off to a great start.

This 14-week boot camp offers everything you need to plan the rest of your life, know you’ll have enough money and make your retirement dreams a reality.

The course, intended for those who are 45 or older, can teach you everything from “Social Security secrets” to how to time your retirement.

For more tips on how to build and maintain a nest egg, check out “Your Top 5 Retirement Questions, Answered.”

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

7 Reasons Not to Claim Social Security Early

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Some people believe in starting to collect Social Security as early as possible, which is generally at age 62.

“Live while it is yet possible to live!” the early birds cry. “After all, I could die tomorrow, and then the government will keep my money.”

What’s more likely is that you’ll live a lot longer than 62.

According to the Social Security Administration (SSA), the average woman reaching the age of 65 today will live until nearly 87. The average man who is 65 today can expect to live until about 84.

One way to help ensure you don’t run out of money before then is to postpone claiming your Social Security retirement benefits. There are advantages to waiting as late as 70 years old.

While waiting until age 70 isn’t for everyone, following are some reasons that claiming sooner than later can be a bad idea.

1. Claiming early reduces your benefit

Some people think that taking Social Security at age 62 means more money overall. That’s not necessarily true.

The amount of your monthly benefit is based on a formula that’s meant to be actuarially neutral. That basically means you should get the same total amount of benefits over the course of your retirement regardless of the age at which you first claim benefits.

Your monthly benefit will be reduced if you claim before reaching what the SSA calls your “full retirement age,” an age set by the SSA that depends on the year you were born. For example, full retirement age for a person born in 1955 is 66 years and 2 months, while full retirement age for anyone born in 1960 or later is 67.

If you delay claiming until after your full retirement age, you will receive an even bigger monthly benefit once you do claim. For every year you hold off past full retirement age, your benefit will grow by as much as 8%.

The SSA’s “Quick Calculator” can give you a rough idea of your own benefit amount based on when you plan to retire.

A custom analysis of your claiming options, offered by specialized companies like Social Security Choices, can further help you determine when the best time is for you to claim your benefits.

Money Talks News founder Stacy Johnson himself got an analysis from Social Security Choices. To learn more about such a report — including how to land a discount on the cost of your report — check out “Maximize Your Social Security.”

2. You might outlive your other retirement income

If there’s a chance that you could use up your retirement funds before you die, a higher Social Security benefit could be crucial.

Getting every last dollar you can in your monthly benefit is important, especially if you don’t have a partner who’s also receiving benefits.

3. Working longer can increase your benefit

Your monthly benefit amount is based on the amount of income you earned during each of your 35 highest-earning working years. However, not everyone is able or willing to work for 35 years, often due to health or family issues.

When that’s the case, the government will substitute zeroes for the missing years in its calculation, which can significantly lower your monthly benefit amount.

Low-earning years also bring down the total, says Emily Guy Birken, author of “Making Social Security Work for You.”

As tempting as early retirement can be, think big-picture and look for ways to bring in more bucks before claiming.

“Anything you can do to replace those zeroes and anything you can do to replace those low-earning years will help beef up your retirement,” Birken tells Money Talks News.

4. COLAs will not boost your benefit as much

A lower monthly benefit means that each cost-of-living adjustment (COLA) — the inflation-based regular increase to your monthly benefit amount — will result in less money than it would have if you had postponed claiming Social Security.

Why? COLAs are a percentage of your monthly benefit. So, the smaller your benefit amount, the smaller your COLA dollar amount.

A 2% COLA, for example, would increase a $2,000 benefit by around $40 a month, or $480 per year. But it would increase a $2,480 benefit by about $49.60, or $595.20 per year.

5. You might stiff your spouse

Working at least until your full retirement age gives your husband or wife a better chance at a reasonably comfortable retirement if you die first.

That’s because widows and widowers often can benefit from Social Security survivors benefits, which are based on their spouse’s benefit amount.

Using the same benefit amounts as above, say a man gets a $2,000 benefit, while his wife’s check will be $1,700 upon her own retirement. If he dies first, she could be eligible for up to $2,000 in monthly benefits. But if he’d waited a few years to claim Social Security, and let his benefit amount grow, she could have been eligible for up to $2,480.

6. You might be hit by a ‘tax torpedo’

Some people want to let their portfolios grow, so they take Social Security early and live on it until they’re forced to withdraw required minimum distributions (RMDs) from their retirement accounts.

This plan can backfire, though, because of how Social Security benefits are taxed.

The extent to which your benefits are taxable is based on what the SSA calls your “combined income.” It includes taxable income, such as withdrawals from tax-deferred retirement accounts like traditional 401(k) plans and traditional individual retirement accounts (IRAs).

Depending on the amount of your combined income, up to 85% of your Social Security benefit could be taxed.

One way to dodge such a tax torpedo is to withdraw less money from your tax-deferred retirement account each year. And delaying claiming Social Security can help you do that because you’ll get a bigger monthly benefit.

In turn, Birken explains:

“You won’t need to take as much from your taxable retirement [plan] to make up the amount you need to live on.”

Some people don’t realize they might have to pay taxes on their benefits. Birken calls it “one of the really nasty surprises about Social Security.”

For more ways to keep Uncle Sam from taking part of your benefits, check out “5 Ways to Avoid Taxes on Social Security Income.”

7. You still like your job

Just because you’re old enough to retire doesn’t mean you have to retire.

Even a part-time salary — plus any other retirement benefits — could cover expenses until you hit age 70, at which point your Social Security benefit would be maximized.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

What Homeowners Do to Sleep at Night

Happy woman sleeping peacefully in bed in the morning
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Now that you’ve signed the mortgage and moved into your new home, you may be thinking it’s time to kick back and enjoy it.

Not so fast.

Have you got a plan for covering the bill when the garage door sticks halfway down just as you’re leaving for work? When the ice maker leaks? When the oven stops cold while you’re baking your 4-year-old’s birthday cake?

There’s no calling the landlord now. It’s all on you.

Here’s an idea: Call America’s 1st Choice Home Club and Reliable Home Warranty now, so you’re covered when (not if) your home systems and appliances break down.

As America’s 1st Choice Home Club says, “Life happens. Be prepared.”

Different from home insurance

It’s easy to confuse home warranties with home insurance. They sound sort of alike.

But they’re not.

Home insurance protects your structure and some of your possessions after a disaster — fire, storms and hail, for example. But home insurance may not help pay to fix or replace your broken garage door or the stopped-dead oven.

That’s when you’ll want a home warranty. A warranty helps repair or replace a home’s systems and appliances that have broken from normal wear and tear.

You’ve got choices

Some plans cover more, others less. Reliable Home Warranty, for example, has three levels of coverage — one for basics (including plumbing, electrical, water heater, oven and dishwasher — oh, and that garage door) and an upgraded plan that covers more: things like laundry appliances, built-in microwaves, and cooling and heating systems. Yet another plan lets you add coverage for pools, spas, roof leaks and septic systems.

“Regardless of the age, make, or model, if we can’t repair it, we’ll replace it,” Reliable Home Warranty says.

At America’s 1st Choice Home Club, you can choose among plans that cover six, nine, 15 or 18 appliances and systems. There’s additional coverage you can buy for home systems, including heating, air conditioning, plumbing and electrical. Check out America’s 1st Choice Home Club; they’ll give you a quote in 30 seconds.

As always, when signing a contract, read all the details, including the fine print.

Do you need a home warranty?

Okay, warranties are a good thing. But do you need one? Well, ask yourself what you will do if:

  • Your furnace quits in mid-December
  • The washer grinds to a halt halfway through a load
  • Your water heater springs a leak while you’re out of town

Can you afford to put life on hold while you search for a repair person? And raid savings to cover surprise repair bills? If so, a warranty’s not for you.

But for many of us, it’s a good idea.

With a home warranty, you can sleep at night knowing that when you call your warranty company, they’ll step in to help.

Warranties sell homes

Thinking of selling your home? Make your listing stand out when you offer a home warranty with the purchase. That added perk gives buyers peace of mind when they make an offer on your home.

Start here by getting your quotes from Reliable Home Warranty and America’s 1st Choice Home Club.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

The Annuity Everyone Needs — and Anybody Can Get

Senior holding cash
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Finding and purchasing the right annuity — especially one with built-in inflation protection — can be a difficult and expensive chore.

But if you are smart and flexible, virtually any American retiree can grab such an annuity on the cheap.

By waiting until age 70 to claim Social Security, you can create an annuity that will pay out the maximum monthly income for which you are eligible.

Even better, the federal government will adjust the payment upward each year to account for inflation — all at no extra cost to you. That is a virtually unheard-of benefit in the world of annuities, where inflation adjustments typically are available only as an expensive add-on feature.

All of this means delaying claiming your Social Security benefits can be a great way to add a little extra financial peace of mind to your golden years.

As Social Security expert Jeff Miller — co-founder of Social Security Choices, a company that provides advice on Social Security claiming decisions — wrote in a Q&A for Money Talks News:

“Social Security is an annuity, and delayed claiming is by far the cheapest annuity you can buy.”

How to get this benefit

To some degree, anyone who collects Social Security gets this built-in annuity benefit. Even if you claim early — such as when you are first eligible at age 62, or any time thereafter up to age 70 — you will get a guaranteed inflation-adjusted payment each month, year after year.

But delaying Social Security until age 70 is the best way to get the biggest payoff if you want to use your benefits in place of a traditional annuity.

By waiting, you get a larger check for the rest of your lifetime. As the Social Security Administration explains, for each year you delay claiming Social Security beyond what’s known as your “full retirement age,” your benefit increases by up to 8%.

Now, there can be good reasons not to delay claiming your Social Security benefits. We outline a few of them in “5 Reasons You Should Claim Social Security ASAP.”

So, you need to determine which claiming strategy makes the best sense for you — and a company like Social Security Choices can help with that decision, as we detail in “A Simple Way to Maximize Your Social Security.”

But if you have saved a lot of money for retirement and want extra peace of mind, delaying Social Security can be a great way to create the maximum inflation-protected income for which you are eligible. And you get that protection without having to pay another dime beyond what you contributed in FICA taxes during your working years.

Sound like a strategy that might work for you? The key to making it a reality is to work later into life and keep a steady income until age 70 — or to have a nest egg big enough to see you through the early years of retirement until you begin claiming Social Security later.

You can get help with saving for retirement by reading:

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

5 States With the Worst Health Care for Retirees

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Retirees traditionally flock to the South to spend their golden years in sunshine and warmth. But if you have a health condition, you may want to think twice before making such a move.

The five states with the worst retiree health care are all located in the South, according to WalletHub’s latest annual ranking of the best states to retire.

The analysis found that the five worst states for retiree health care in 2021 are:

  • West Virginia (ranked No. 50 for health care)
  • Mississippi (No. 49)
  • Alabama (No. 48)
  • Tennessee (No. 47)
  • Kentucky (No. 46)

In ranking the 50 states based on the health care available to retirees, WalletHub looked at more than a dozen metrics, including:

  • COVID-19 testing rate and death rate
  • Number of family and general physicians per capita
  • Number of dentists per capita
  • Top-rated geriatrics hospitals
  • Quality of public hospitals

If good health care is paramount for you — and you can stand the cold — staying in the North for retirement might be a better idea. Four of the five top states for retiree health care are located in colder climates.

However, the tropical paradise of Hawaii topped that list. So, you could retire there — if you can afford it.

The top five states for retiree health care are:

  1. Hawaii
  2. Minnesota
  3. Vermont
  4. Alaska
  5. Colorado

How to cut your health care costs

Health care is expensive. That’s true no matter where you live — or what age you are. With a little planning, though, you can hang on to more of your hard-earned cash.

For example, a little old-fashioned “give and take” — like offering to pay in cash — might save you a bundle. As we report in “7 Ways Anyone Can Cut Their Health Care Costs“:

“Tell the medical office that you’re paying cash for a service and ask for a discount. Besides a lower bill, you might be able to negotiate a no-interest payment plan to spread your payments over a few months.”

Prescription drugs are a costly fact of life for millions of retirees. But Money Talks News managing editor Karla Bowsher has learned a few things about trimming such expenses.

Tap into her hard-earned wisdom by checking out “5 Ways I Slashed My Drug Costs up to 50%.”

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

This Is the Best Age to Buy Long-Term Care Insurance

Man in a nursing home
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Long-term care is jaw-droppingly expensive. The national median cost for staying in a private room at a nursing home is $105,852 per year, according to Genworth Financial.

Receiving care in your home is cheaper, but even a home health aide will set you back almost $55,000 a year, assuming they provide care for 6.5 hours a day.

Don’t assume Medicare will pick up the tab, either. It doesn’t provide coverage for ongoing custodial care such as that typically provided by assisted living and nursing home facilities.

State Medicaid programs will pay for nursing home care but only after you’ve depleted almost all your assets first.

Buying long-term care insurance is one way to cover the cost of care, but policies can come with their own hefty price tag.

Premiums will be lower if you buy coverage when you’re younger, but you may end up paying for years on a policy before you need it. Wait too long, and you could be denied coverage.

So what’s the sweet spot for purchasing long-term care insurance? It seems to be in your 50s.

Consider long-term care insurance before age 60

Premiums for long-term care insurance climb as you age, but that’s not the main reason you want to buy early. Instead, you want to have some coverage in place in your 50s before any health issues could waylay your application.

“Something as simple as going to physical therapy could cause a denial,” says Erin Ardleigh, founder and president of Dynama Insurance, which is based in New York City but helps clients nationwide. “Waiting until 60 (to buy insurance) can be risky.”

At age 65, more than one-third of long-term care insurance applicants are denied, according to 2020 data from the American Association for Long-Term Care Insurance.

More than half of applications for those age 75 and older are denied.

Long-term care insurance costs by age

Once you hit your 60s, insurance prices start to go up significantly as well.

The following is an example of how monthly premiums increase based on an applicant’s age.

These estimates, provided by a Mutual of Omaha calculator, assume a single female in Manhattan is applying for coverage of $5,000 a month for 36 months.

  • Age 45: $234 per month
  • Age 55: $293 per month
  • Age 65: $422 per month
  • Age 75: $820 per month

While most policies are designed to have level premiums, there is no guarantee they won’t go up, Ardleigh says. Premiums may also depend upon whether someone is buying insurance as part of a couple and what elimination period is included in the policy. The elimination period is the amount of time that must pass after you begin needing care before benefits are paid.

Buying some coverage is better than none

Ardleigh recommends her clients buy policies that have, at a minimum, a $5,000 a month benefit for 24 months. A higher monthly benefit means the opportunity to stay in a nicer facility should you need care. However, purchasing more than three years of coverage may be unnecessary for many people, since the average nursing home stay lasts just two to three years.

If a policy with those minimums is too expensive, any coverage will be better than no coverage.

“Imagine it’s snowing,” Ardleigh suggests as an analogy. “Anything you put on is going to help when you go outside.”

While a light jacket isn’t as good as a heavy winter coat, it’s better than walking outdoors without any outerwear.

If you can’t afford a traditional long-term care policy or aren’t sure if you’ll need long-term care, a hybrid life insurance policy is another option. These policies provide coverage for long-term care, and any benefits not used during the policyholder’s lifetime are passed on to heirs as a death benefit.

“We’re definitely seeing people who are younger buying long-term care insurance through hybrid policies,” Ardleigh says.

While not everyone will have the same long-term care insurance needs, everyone needs to have a long-term care plan. Talk to a trusted insurance broker and get quotes from several companies and product lines to help you decide what is the best way to prepare for covering the costs associated with home health, assisted living and nursing home care.

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Source: moneytalksnews.com