health care http://www.wisebread.com/taxonomy/term/1472/all en-US 4 Affordable Retirement Spots With World-Class Health Care http://www.wisebread.com/4-affordable-retirement-spots-with-world-class-health-care <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/4-affordable-retirement-spots-with-world-class-health-care" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/senior_woman_placing_hands_on_the_shoulder_of_senior_man.jpg" alt="Senior woman placing hands on the shoulder of senior man" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Health care is one of the biggest considerations for any retiree planning to settle abroad, and could be a deciding factor when choosing which country to move to. Since Medicare does not cover health care costs for U.S. citizens living overseas, it&rsquo;s important to have a plan in place for how you&rsquo;re going to pay for it. But more than that, it&rsquo;s well advised to select somewhere that has a quality health care system to ensure that you get a good standard of treatment when you require it. (See also: <a href="http://www.wisebread.com/follow-these-5-steps-to-full-health-care-coverage-in-retirement?ref=seealso" target="_blank">Follow These 5 Steps to Full Health Care Coverage in Retirement</a>)</p> <p>As the saying goes, you can&rsquo;t put a price on your health. You can however, reduce how much it will cost for any treatment required. Many countries that are affordable to live in have health care on par with the U.S., so not only will your medical bills go down, but so will your cost of living.</p> <p>Note: All cost of living estimates refer to figures from <a href="http://numbeo.com" target="_blank">Numbeo</a>, the world&rsquo;s largest database of user contributed data about cities and countries worldwide.</p> <h2>Mexico</h2> <p><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5197/san_miguel_de_allende_in_mexico.jpg" width="605" height="340" alt="" /></p> <p>Living costs in Mexico City are nearly 60 percent lower than those in New York City, which is just one of the many reasons the country is a popular destination for retirees. It also has a high number of expats and a selection of communities specifically set up for retired Americans. Whether you want beautiful beaches, quaint colonial towns, or bustling cities with developed infrastructures, Mexico has it all. (See also: <a href="http://www.wisebread.com/how-almost-anyone-can-afford-to-retire-in-mexico?ref=seealso" target="_blank">How Almost Anyone Can Afford to Retire in Mexico</a>)</p> <p>As a foreigner, you won&rsquo;t be entitled to free public health care, but you&rsquo;ll have wide access to facilities because the majority of hospitals in Mexico are private establishments. Perhaps unsurprisingly, many of the best medical facilities in this country are based within the major cities of Mexico City, Guadalajara, and Monterrey. Thanks to the country&rsquo;s proximity to the U.S., many of Mexico&rsquo;s doctors not only speak excellent English, but have also spent time training and studying in the U.S.</p> <p>Dental care is particularly cheap in Mexico, with many U.S. citizens making special trips to enjoy the low prices. The border town of Los Algodones has even been nicknamed the &ldquo;dental capital of the world&rdquo; thanks to the high concentration of dental clinics there. Opticians are also easy to find in Los Algodones and there are a number of national chains and franchises that provide low priced examinations and treatments. (See also: <a href="http://www.wisebread.com/retire-for-half-the-cost-in-these-5-countries?ref=seealso" target="_blank">Retire for Half the Cost in These 5 Countries</a>)</p> <h2>Malaysia</h2> <p><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5197/floating_mosque_reflection_in_penang_malaysia.jpg" width="605" height="340" alt="" /></p> <p>Malaysia is regularly recognized as one of the best countries to retire in thanks to its welcoming culture, warm climate, and extremely low living costs. Life in the capital, Kuala Lumpur, is 54 percent cheaper than in New York City, meaning your dollar goes a lot further. Retirees from across the globe understandably see this as a real attraction, and in the major cities you&rsquo;ll find large expat populations.</p> <p>Medical tourism is big business here, so much so that Malaysia&rsquo;s Ministry of Health has its own Healthcare Travel Council. It was set up by the government to raise the profile of the country as a top destination for world-class health care services and increase both the quality and quantity of medical tourism. It helps provide a standardized level of service by only approving and endorsing top quality medical facilities, which should give you peace of mind when selecting where to get treatment.</p> <p>As a non-Malaysian, you won&rsquo;t have access to free public health care, meaning you&rsquo;ll need to get a good insurance policy. However, these are generally cheaper than in the U.S., and will enable you to receive treatment in either public or private facilities, depending on your preference. (See also: <a href="http://www.wisebread.com/5-incredible-places-to-retire-abroad-that-anyone-can-afford?ref=seealso" target="_blank">5 Incredible Places to Retire Abroad That Anyone Can Afford</a>)</p> <h2>Costa Rica</h2> <p><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5197/national_theatre_of_costa_rica_in_san_jose.jpg" width="605" height="340" alt="" /></p> <p>With stunning Caribbean beaches, lush inland jungles, developed cities, and a warm, sunny climate all year round, Costa Rica really has it all. The cost of living in San Jose is 40 percent below that of New York City, while the standard of living remains extremely high. It&rsquo;s little wonder Costa Rica is so popular among retirees from the U.S.</p> <p>Many U.S. citizens already travel to Costa Rica every year for so-called medical tourism, as the prices are far lower than back home. But for expats living there as legally recognized residents, it gets even better. You have access to both tiers of their health service, private and public. If you need emergency treatment, you are eligible to receive it under the universal Caja system, as well as regular checkups, many prescription drugs, and even some surgeries.</p> <p>In addition to the public health care available, there&rsquo;s also an excellent private system that many retirees pay for, mainly because waiting times on non life-threatening surgeries are much shorter. Both systems are renowned for having up-to-date equipment, facilities, and technologies, which partly explains why the health care is rated so highly. You&rsquo;ll also find that most doctors speak English to a very high standard, which should alleviate any concerns around communication. (See also: <a href="http://www.wisebread.com/5-countries-that-welcome-american-retirees?ref=seealso" target="_blank">5 Countries That Welcome American Retirees</a>)</p> <h2>Portugal</h2> <p><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5197/porto_portugal_cityscape.jpg" width="605" height="340" alt="" /></p> <p>This former world superpower on the southern tip of Europe&rsquo;s Iberian Peninsula once ruled over territories across Latin America, Oceania, Asia, and Africa. These days it&rsquo;s more famous as a major tourist destination, thanks to its incredible beaches, historic architecture, and diverse cuisine. With Lisbon&rsquo;s cost of living 43 percent lower than New York&rsquo;s, many retirees are now viewing this as the perfect place to settle down. The Algarve coast in particular is a retirement hot spot, as it has great weather, beautiful beaches, and a large, established expat community for support.</p> <p>Portugal has always been a well-loved holiday and retirement destination for Europeans, but recently it&rsquo;s become popular among Americans as well. With Portugal&rsquo;s introduction of the Non-Habitual Resident Regime, it&rsquo;s now possible receive your pension tax free here as well as many other sources of income.</p> <p>On top of these benefits, Portugal&rsquo;s health care system is well-known for having excellent facilities and well-trained staff. There is a good public health care system here that foreigners have access to. It&rsquo;s free apart from some nominal patient contributions used to ensure people access the service in the correct way &mdash; for example, not going to the emergency room unless absolutely necessary. Doctors, particularly in the popular areas for retirees, generally speak English.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/nick-wharton">Nick Wharton</a> of <a href="http://www.wisebread.com/4-affordable-retirement-spots-with-world-class-health-care">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-retirement-hotspots-that-are-cheaper-now-than-ever-before">9 Retirement Hotspots That Are Cheaper Now Than Ever Before</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/13-financial-steps-to-take-before-retiring-abroad">13 Financial Steps to Take Before Retiring Abroad</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-choose-the-perfect-country-to-retire-in">How to Choose the Perfect Country to Retire In</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-common-medicare-myths-debunked">5 Common Medicare Myths, Debunked</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-let-these-expenses-spoil-your-retirement-abroad">Don&#039;t Let These Expenses Spoil Your Retirement Abroad</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Health and Beauty Retirement Travel health care international travel retire abroad retirement retirement hot spots world-class health care Tue, 21 Nov 2017 09:30:10 +0000 Nick Wharton 2056742 at http://www.wisebread.com 13 Financial Steps to Take Before Retiring Abroad http://www.wisebread.com/13-financial-steps-to-take-before-retiring-abroad <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/13-financial-steps-to-take-before-retiring-abroad" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/happy_couple_enjoying_their_retirement.jpg" alt="Happy couple enjoying their retirement" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>If things go well for you, retirement can last for decades. But your retirement savings might not, especially if you live in a high-cost area. Households with a resident aged 65 or older have a median income of just $38,515, according to the U.S. Census Bureau. It's no wonder that the number of Americans retiring abroad grew 17 percent between 2010 and 2015, now numbering some 400,000, according to the Social Security Administration. (See also: <a href="http://www.wisebread.com/5-countries-where-you-can-retire-for-1000-a-month?ref=seealso" target="_blank">5 Countries Where You Can Retire for $1,000 a Month</a>)</p> <p>But retiring abroad isn't as simple as going on vacation. How will you access your savings or benefits from overseas? Can you buy property? What about medical care? All these questions can be addressed with some pre-takeoff financial planning. (See also: <a href="http://www.wisebread.com/9-things-to-know-before-retiring-abroad?Ref=seealso" target="_blank">9 Things to Know Before Retiring Abroad</a>)</p> <h2>1. Find a retiree-friendly destination</h2> <p>Some places have incentives like tax breaks and visa offers to attract American retirees, such as Panama and Costa Rica's <em>pensionado </em>programs. You may also qualify for senior citizen benefits established for locals, such as Ecuador's senior discount program, which offers savings on airfare, utilities, and sporting events.</p> <p>In addition, it's a good idea to consult the <a href="https://travel.state.gov/content/passports/en/country.html" target="_blank">State Department's country-specific information</a> about visa laws, health and safety conditions, and how much money you'd be allowed to bring into the country with you. (See also: <a href="http://www.wisebread.com/5-countries-that-welcome-american-retirees?ref=seealso" target="_blank">5 Countries That Welcome American Retirees</a>)</p> <h2>2. Find out if you can get Social Security payments there</h2> <p>Six in 10 retirees rely on Social Security for at least half their income, according to the Social Security Administration, making this a pretty important consideration. Fortunately, the SSA can send you your check if you move abroad to most countries, with the notable exceptions of Cuba and Cambodia. For certain other countries, including Ukraine, you can get your payments, but only if you meet certain conditions such as appearing at a U.S. embassy or consulate every six months.</p> <p>The Social Security Administration offers the <a href="https://www.ssa.gov/international/payments_outsideUS.html" target="_blank">Payments Abroad Screening Tool</a> to help you figure out if you'll be able to collect payments overseas.</p> <p>If you are a non-U.S. citizen receiving Social Security because you worked in the U.S. or are a dependent of someone who did, the rules on receiving payments overseas are more complicated. Consult the SSA booklet, <a href="https://www.ssa.gov/pubs/EN-05-10137.pdf" target="_blank">Your Payments While You Are Outside the United States</a> for the full story.</p> <p>Many American embassies worldwide have a <a href="https://www.ssa.gov/foreign/foreign.htm" target="_blank">Federal Benefits Unit</a> to help retirees with any Social Security issues.</p> <h2>3. Hire a new financial adviser</h2> <p>The wave of Americans retiring abroad has given rise to a new specialty in the financial industry: Cross-Border Planning. A cross-border specialist will help you understand local income tax laws so you don't risk over- or underpaying. They can also help you safely move spending money from the U.S. to your new home, and guide you through many other issues you might never have considered.</p> <p>It's almost impossible to find someone who knows the laws of every country, so use the <a href="http://crossborderplanning.com/about_us.htm" target="_blank">Cross-Border Financial Planning Alliance</a> to find someone who specializes in your chosen country.</p> <h2>4. Figure out what to do with your bank accounts</h2> <p>You should keep your U.S. bank account open to handle any expenses and bills you have stateside, and open another one in your new home country. Ask your U.S. bank if they charge a fee for making withdrawals from foreign automatic teller machines; if they do, you might want to upgrade your account or change banks before you move.</p> <p>For your foreign account, Expat Info Desk recommends choosing a large, well-known bank and transferring your money using an international currency exchange service. These are companies that transfer large amounts of money to an account in a foreign country, and they may offer a better conversion rate. Another option is to ask your home bank if they operate in your destination country.</p> <p>If you have more than $10,000 worth of assets in foreign accounts, the IRS notes you must report this to the U.S. government every year by filing a Report of Foreign Bank and Financial Accounts (FBAR) or face penalties of up to $100,000.</p> <h2>5. Stay on good terms with the U.S. Department of Treasury</h2> <p>Even though you no longer live in the U.S., if you maintain citizenship, you need to pay taxes. The Internal Revenue Service offers guidance on how and when to <a href="https://www.irs.gov/individuals/international-taxpayers/taxpayers-living-abroad" target="_blank">file a tax return from overseas</a>.</p> <p>Don't imagine that you'll be out of sight, out of mind to the U.S. government. In fact, it's actually more important for you to pay up than it is for citizens living at home, because if you owe more than $50,000 in delinquent payments, you could lose your passport.</p> <h2>6. Get online</h2> <p>Although mail service is unreliable in some parts of the world, internet connections are nearly ubiquitous. Even if you have always used paper statements and written checks before, now is a good time to embrace online banking to avoid delays and the cost of international postage.</p> <h2>7. Rent a home, then learn about buying</h2> <p>The Australian Expat Investor suggests renting at first, unless you have already been visiting your new country for years and are sure you're there to stay. You'll need to learn about the rules for tenancy in your new country. Don't be surprised if you have to pay an entire year's rent in advance. Even if you don't actually sign a lease before you move abroad, you should put aside the money you'll need and find out how to transfer it.</p> <p>Once you're established in your new country, look into whether purchasing a home might be a good financial move. It could cut your costs and serve as an investment if the local property market is on the upswing. (See also: <a href="http://www.wisebread.com/how-to-choose-the-perfect-country-to-retire-in?ref=seealso" target="_blank">How to Choose the Perfect Country to Retire In</a>)</p> <h2>8. Tap your U.S. home for income or capital</h2> <p>If you'll be leaving behind a home you own, you may not want to sell it at first. But you could consider renting out all or part of it. Some retirees use Airbnb to flexibly get income from their U.S. home, while reserving its availability for when they come back to visit. (See also: <a href="http://www.wisebread.com/5-easy-ways-to-make-good-money-from-airbnb?ref=seealso" target="_blank">5 Easy Ways to Make Good Money From Airbnb</a>)</p> <p>If you want to refinance your U.S. property to get money to buy a home overseas, look into doing that before you go. Homeowners who try to refinance from overseas may face a lot more confusing paperwork and hurdles.</p> <h2>9. Make an estate plan</h2> <p>If you have never made a will or considered putting assets in a revocable trust, talk to an estate attorney before you go, and get this taken care of. Find a lawyer who is knowledgeable about handling such things while living abroad, so they can advise you on whether your U.S. will can provide for distributing foreign assets, or if you'll need a second will created in your new home country.</p> <p>If you already have an estate plan, consult an attorney to see if any amendments will need to be made to cover assets located abroad.</p> <h2>10. Make a health care plan</h2> <p>Health care tends to be one of the greatest expenses in retirement. And unlike Social Security, you will not be able to use your Medicare benefits overseas. One decision to make is whether to enroll in Medicare anyway, so that it's still available to you on visits home or if you need to return to the States unexpectedly.</p> <p>Since most people don't have to pay a premium for Medicare Part A, which covers domestic hospitalization, some nursing home care, and hospice care, keeping that is a no brainer. Should you also pay for Medicare Part B, which helps pay for doctor visits and some prescriptions, among other expenses? That depends on how likely it is that you will ever return to the United States. If you don't carry Part B, and you must return because you become disabled and need help from your children, for example, you may have to go without coverage for months while waiting for the annual enrollment period, and you may also face premium penalties.</p> <p>Since Medicare is off the table for any care you need while overseas, you'll need to plan for financing that. Fortunately, health care in other countries is less expensive than it is in the United States. For example, the average per capita medical spending in Mexico is just over $1,000, compared just under $10,000 in the United States, according to the Organization for Economic Cooperation and Development. So paying for health care expenses out of pocket or buying local insurance or a hospital membership plan may be reasonable, with many expats saying they pay under $100 a month.</p> <h2>11. Buy insurance for everything else</h2> <p>Besides your health, you'll also need to insure your property. Understanding what insurance local laws require may be a lot harder in other markets than it is in the United States. It's a good idea to consult your local real estate agent about what insurance policy to get.</p> <h2>12. Get a financial power of attorney</h2> <p>You may need an adult son or daughter, or other representative, to make financial moves in your place while you are overseas. It's a good idea to leave them with a financial power of attorney document so that they can sign for you, for example, while selling property or other investments. (See also: <a href="http://www.wisebread.com/what-is-power-of-attorney?ref=seealso" target="_blank">What Is Power of Attorney?</a>)</p> <h2>13. Make an exit plan</h2> <p>Some retirees plan to enjoy their new home country while their health lasts, then return stateside if they become ill or disabled. If that's you, you'll want domestic long-term care insurance, and/or a nest egg in U.S. accounts to live off when you return. (See also: <a href="http://www.wisebread.com/is-long-term-care-insurance-worth-it?ref=seealso" target="_blank">Is Long Term Care Insurance Worth It?</a>)</p> <p>Even if you plan to live in the new country for the rest of your life, if you want your remains returned to the U.S., you'll need to plan for that. Look into emergency evacuation/repatriation insurance to help with medically equipped flights home or transportation of remains.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/carrie-kirby">Carrie Kirby</a> of <a href="http://www.wisebread.com/13-financial-steps-to-take-before-retiring-abroad">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-almost-anyone-can-afford-to-retire-in-mexico">How Almost Anyone Can Afford to Retire in Mexico</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/retire-for-half-the-cost-in-these-5-countries">Retire for Half the Cost in These 5 Countries</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-travel-in-retirement-keeps-you-young">6 Ways Travel in Retirement Keeps You Young</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-let-these-expenses-spoil-your-retirement-abroad">Don&#039;t Let These Expenses Spoil Your Retirement Abroad</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-overcome-these-4-common-retirement-fears">How to Overcome These 4 Common Retirement Fears</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Retirement Travel expats foreign countries health care long term care retiring abroad social security Mon, 20 Nov 2017 09:00:07 +0000 Carrie Kirby 2056087 at http://www.wisebread.com It's So Simple: 6 Steps to a Stable Retirement http://www.wisebread.com/its-so-simple-6-steps-to-a-stable-retirement <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/its-so-simple-6-steps-to-a-stable-retirement" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/senior_couple_dancing.jpg" alt="Senior couple dancing" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>If you are new to personal finance, you might find yourself thinking that reaching retirement is sort of like reaching a mythical place like Hogwarts. In both cases, the process required for entry is never adequately explained &mdash; and getting there yourself feels more like fantasy than reality.</p> <p>While it's unlikely that an owl will ever arrive to welcome you to a magical school, retirement is actually attainable for each and every muggle. In fact, the rules for reaching a stable retirement are relatively simple and require absolutely no financial wizardry on your part,</p> <p>Here are the only six things you need to do to achieve a stable retirement &mdash; no magic wands required.</p> <h2>1. Always spend less than you earn</h2> <p>No matter how much you make, you need to live on less than you earn. This is the kind of so-simple-it-feels-obvious advice that many personal finance experts take for granted, but keeping your expenses below your income is the cornerstone of saving for a stable retirement. Many people assume that they need to make a certain level of income before they can afford to start saving for retirement, but that's not true. As long as you always spend less than you earn, you can always save toward your retirement.</p> <p>If you're not sure how to go about reducing your expenses so that you're no longer spending everything that comes in, start by tracking your spending. This will help you better understand where your money is going so you can cut back on unnecessary spending. (See also: <a href="http://www.wisebread.com/save-more-and-spend-less-by-increasing-your-mental-transaction-costs?ref=seealso" target="_blank">Save More and Spend Less by Increasing Your &quot;Mental Transaction Costs&quot;</a>)</p> <h2>2. Max out your retirement contributions</h2> <p>Both your employer-sponsored 401(k) and your individual retirement account (IRA) have yearly contribution limits that you should strive to meet every year. The 2017 contribution limits are $18,000 for 401(k) plans (plus an additional $6,000 in catch-up contributions if over age 50), and $5,500 for IRAs ($6,500 if over age 50). The traditional versions of these investment vehicles are tax-deferred, which means you are funding your accounts with pretax dollars. Roth 401(k) plans and IRAs are funded with money you have paid taxes on, but they, like the traditional vehicles, grow tax-free.</p> <p>Many people can't afford to meet the full contribution limit for their 401(k) plan, plus maxing out an IRA as well. However, getting as close to the maximum contribution as you can for both of these vehicles will put you well on your way to retirement stability. In addition, many employers offer a 401(k) contribution match &mdash; and not maxing out this kind of matching program is akin to leaving free money on the table. (See also: <a href="http://www.wisebread.com/how-much-should-you-have-saved-for-retirement-by-30-40-50?ref=seealso" target="_blank">How Much Should You Have Saved for Retirement by 30? 40? 50?</a>)</p> <h2>3. Work at least 35 years</h2> <p>While retiring early is a common dream among many workers, leaving the workforce before putting in 35 full years of employment could damage your bottom line in retirement. That's because your Social Security benefits are calculated using the 35 highest earning years in your career. If you have less than 35 years of work experience, the Social Security Administration uses zeros to create your benefit calculation, lowering your average earnings and your payout. If you don't have 35 years of employment history, it's a good idea to keep working to get those zeros replaced in your Social Security calculation.</p> <p>Doing whatever you can to increase your monthly benefit will make a big difference in your bottom line once you retire. The most important increase you can make is to work at least 35 years total &mdash; although waiting as long as you can to take Social Security benefits is also an important strategy for increasing your monthly Social Security check. (See also: <a href="http://www.wisebread.com/6-smart-ways-to-boost-your-social-security-payout-before-retirement?Ref=seealso" target="_blank">6 Smart Ways to Boost Your Social Security Payout Before Retirement</a>)</p> <h2>4. Avoid debt</h2> <p>We live in a society that tells us we can have it all right now and pay for it later. The problem is that we <em>will</em> indeed pay for it later &mdash; with an impoverished retirement. While it may be possible to finance the lifestyle you want with debt, you will have no money available to save for retirement or otherwise invest. In addition, the added interest expense of borrowing money to pay for your lifestyle just makes it that much more expensive and unsustainable. (See also: <a href="http://www.wisebread.com/5-ways-to-pay-off-high-interest-credit-card-debt?ref=seealso" target="_blank">5 Ways to Pay Off High Interest Credit Card Debt</a>)</p> <h2>5. Invest for the long-term with index funds</h2> <p>While the movies show investing as a kind of game that you win by figuring out when to buy low and sell high, the best way to make sure your money grows is to follow a long-term buy-and-hold strategy.</p> <p>A 2016 DALBAR study on investment behavior revealed that investors routinely underperform the market despite solid annualized returns. For example, at the end of 2015, the S&amp;P 500 was averaging a return of 8.19 percent. That same year, investors saw returns top out at a measly average 4.67 percent &mdash; and this pattern is not new. Why such a discrepancy? Simple; rather than employing a buy-and-hold strategy, investors routinely try (and fail) to time the market. Year after year, their returns suffer as a result.</p> <p>You can use statistics and a long investment term to your advantage by investing in index funds. These funds aim to replicate the movement of specific securities in a target index, which means an index fund is going to do about as well as the target securities will do. (See also: <a href="http://www.wisebread.com/want-your-investments-to-do-better-stop-watching-the-news?ref=seealso" target="_blank">Want Your Investments to Do Better? Stop Watching the News</a>)</p> <h2>6. Take care of your health</h2> <p>Your health can have an enormous impact on your financial stability in retirement. That's because health care costs are a major concern in your older years, especially since this is one aspect of your retirement budget that you may not have control over. According to a 2016 Fidelity study, a 65-year-old couple retiring in 2016 will need about $260,000 to cover their medical and health care costs for the rest of their lives.</p> <p>While kale smoothies and daily kettlebell workouts cannot ensure your good health in retirement, taking good care of yourself throughout your life does improve the odds that you'll stay healthier as you age. You can consider each jog and healthy meal as an investment in your future. (See also: <a href="http://www.wisebread.com/dont-let-poor-health-kill-your-retirement-fund?ref=seealso" target="_blank">Don't Let Poor Health Kill Your Retirement Fund</a>)</p> <h2>Reaching retirement, one step at a time</h2> <p>Achieving a stable retirement doesn't require any magic. Instead, it's a matter of following some simple rules that will ensure you have the money you need to retire comfortably.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fits-so-simple-6-steps-to-a-stable-retirement&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FIt%2527s%2520So%2520Simple_%25206%2520Steps%2520to%2520a%2520Stable%2520Retirement.jpg&amp;description=It's%20So%20Simple%3A%206%20Steps%20to%20a%20Stable%20Retirement"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/It%27s%20So%20Simple_%206%20Steps%20to%20a%20Stable%20Retirement.jpg" alt="It's So Simple: 6 Steps to a Stable Retirement" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/emily-guy-birken">Emily Guy Birken</a> of <a href="http://www.wisebread.com/its-so-simple-6-steps-to-a-stable-retirement">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-7"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-signs-your-retirement-is-on-track">8 Signs Your Retirement Is on Track</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-benefits-of-carrying-a-mortgage-into-retirement">5 Benefits of Carrying a Mortgage Into Retirement</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-reasons-an-hsa-is-actually-worth-having">10 Reasons an HSA Is Actually Worth Having</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/are-you-putting-off-these-9-adult-money-moves">Are You Putting Off These 9 Adult Money Moves?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/12-money-moves-to-make-the-moment-you-decide-to-retire">12 Money Moves to Make the Moment You Decide to Retire</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Retirement buy and hold contributions debt health care index funds investing returns social security benefits stable retirement Tue, 31 Oct 2017 09:00:06 +0000 Emily Guy Birken 2041362 at http://www.wisebread.com 15 Surprising Insurance Policies You Might Need http://www.wisebread.com/15-surprising-insurance-policies-you-might-need <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/15-surprising-insurance-policies-you-might-need" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/family_doctor.jpg" alt="Family doctor" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Most people are familiar with the most common kinds of insurance &mdash; home, auto, life, and health insurance. But there are many additional insurance policies available for things that are probably not covered by your everyday basic policies. Depending on your risk exposure, additional insurance coverage could be worth the cost. (See also: <a href="http://www.wisebread.com/10-weird-types-of-insurance-you-didnt-even-know-about?ref=seealso" target="_blank">10 Weird Types of Insurance You Didn't Even Know About</a>)</p> <p>Here are some less well known kinds of insurance you might want to consider.</p> <h2>1. Pet insurance</h2> <p>This is basically health insurance for pets. A pet insurance policy can limit your expenses if your pet gets injured or sick and requires a costly medical procedure. If you would spend almost anything to save your fur baby, this can be worth getting so you don't have to worry about devastating veterinary bills. The cost of pet insurance ranges from about $10 to $70 per month, depending on the type of pet and the level of coverage. (See also: <a href="http://www.wisebread.com/7-things-you-need-to-know-about-pet-insurance?ref=seealso" target="_blank">7 Things You Need to Know About Pet Insurance</a>)</p> <h2>2. Earthquake insurance</h2> <p>Even though there is not much risk of a big quake here in Iowa, I once added earthquake coverage to my homeowners policy. At the time I lived in an old, two-story farmhouse that I thought would be susceptible to an earthquake, and the cost of coverage was only a few dollars per year. It was well worth it for the peace of mind.</p> <h2>3. Flood insurance</h2> <p>Damage to your home by flooding is not typically covered by standard homeowners insurance policies. If there has been a history of flooding on your property or nearby homes, you will want to take a look at getting flood insurance. The average cost of flood insurance is around $700 per year, but it can depend on the location and risk of flooding. (See also: <a href="http://www.wisebread.com/everything-you-need-to-know-about-flood-insurance?ref=seealso" target="_blank">Everything You Need to Know About Flood Insurance</a>)</p> <h2>4. Disability insurance</h2> <p>Disability insurance protects your paycheck in case you become incapacitated or disabled and are unable to work. Short-term disability insurance typically replaces about 80 percent of your income for two to six months. Long-term disability coverage may last for years or even your entire life, and typically covers up to 60 percent of your income. Disability insurance is especially important if you have a single earner in your household, or if one earner makes most of the income. (See also: <a href="http://www.wisebread.com/4-things-you-need-to-know-about-disability-insurance?ref=seealso" target="_blank">4 Things You Need to Know About Disability Insurance</a>)</p> <h2>5. Long-term care insurance</h2> <p>If you become unable to take care of yourself later in life, you may need assisted living services or to move into a nursing home; both of which can be astronomically expensive. Long-term care insurance helps cover these expenses and is offered as a traditional insurance policy or as a hybrid policy that combines life insurance and long-term care insurance. Note that these policies can be expensive, costing up to $2,000 per year &mdash; sometimes more. (See also: <a href="http://www.wisebread.com/is-long-term-care-insurance-worth-it?ref=seealso" target="_blank">Is Long Term Care Insurance Worth It?</a>)</p> <h2>6. Supplemental health insurance</h2> <p>In case of illness or injury, supplemental health insurance may cover deductibles and co-payments that are not covered by other forms of insurance. It may even provide a cash payment to cover expenses such as utility bills, housing payments, and groceries while you are not working. Plans typically cost up to $30 per month.</p> <h2>7. Identity theft insurance</h2> <p>If you are a victim of identity theft, this insurance policy will cover the expenses of restoring your identity, including application fees, postage, notary fees, and attorney fees. Some policies also provide fraud loss coverage in case funds are stolen from your account. Coverage costs between $25 and $50 per year.</p> <h2>8. Student loan insurance</h2> <p>Unlike most other types of debt, student loans cannot be discharged through bankruptcy if you become disabled and are unable to make the payments. Some disability insurance providers offer student loan protection that can be added onto a disability policy that will make your student loan payments. This type of coverage is especially popular for medical school graduates and others with large student loans.</p> <h2>9. Wedding insurance</h2> <p>A lot of the expensive things that can go wrong with a wedding are covered by wedding insurance. The wedding may need to be postponed due to illness or injury. The wedding dress, rings, and even the cake can be lost or damaged. Depending on coverage, wedding insurance typically costs a few hundred dollars and may be worth considering if you are planning an elaborate event for the big day. You can also get liability coverage to protect you in case an accident happens at the wedding.</p> <h2>10. Travel insurance</h2> <p>Travel insurance comes in two main varieties: trip cancellation insurance and medical travel insurance. Trip cancellation insurance typically runs about 5 to 7 percent of the trip cost and protects you from losses in case your trip is canceled due to sudden illness or natural disaster. Some <a href="http://www.wisebread.com/6-types-of-travel-insurance-credit-cards-include-that-you-didnt-know-about" target="_blank">credit cards offer travel protection</a>, so check with your card provider before taking out a separate policy. Medical travel insurance covers medical expenses if you are sick or injured in a foreign country, where your standard health insurance policy may not help you. (See also: <a href="http://www.wisebread.com/everything-you-need-to-know-about-buying-travel-insurance?ref=seealso" target="_blank">Everything You Need to Know About Buying Travel Insurance</a>)</p> <h2>11. Dorm insurance</h2> <p>Dorm insurance covers expensive items that you might take with you to college, such as a computer. It typically has a very low deductible (around $25), which makes it easier to get a payout if you suffer a loss. A $5,000 policy may have a premium of around $140 a year, according to Consumer Reports. But your homeowners insurance policy may already provide some coverage for students living in dormitories, so check before you sign up.</p> <h2>12. Renter's insurance</h2> <p>Even if you don't own a home, you may still want insurance coverage for possessions such as your clothes, furniture, and electronics in case of theft or damage. In fact, many landlords require you have this kind of insurance. Depending on the coverage, policies start at around $12 per month. (See also: <a href="http://www.wisebread.com/5-reasons-you-definitely-need-renters-insurance?ref=seealso" target="_blank">5 Reasons You Definitely Need Renters' Insurance</a>)</p> <h2>13. Antiques insurance</h2> <p>If you have a valuable collection of antiques, coins, stamps, fine wine, or anything else out of the ordinary, you might want to consider getting your collection appraised and getting insurance coverage to replace it in case of damage, theft, or destruction. Standard homeowners insurance policies have limited coverage for special items, so adding a rider or separate policy may make sense. Premiums can vary widely depending on the appraised value of your items.</p> <h2>14. Longevity insurance</h2> <p>One of the big variables in retirement planning is estimating your life span. Living for a long time increases the amount of funds you'll need in retirement. If you are worried about outliving your retirement savings, you can get longevity insurance, a type of deferred annuity, that starts paying out once you hit a certain age, such as 85. An important thing to note is longevity insurance is &quot;use it or lose it&quot; &mdash; if you die before collecting your benefit, the money is lost.</p> <h2>15. Mortgage protection insurance</h2> <p>Mortgage protection insurance pays off your mortgage in the event of your death, and covers your loan payments if you become disabled or lose your job. If you have life insurance and disability insurance, you may already be covered for this risk. Mortgage protection insurance can be a good option if you are in a high risk occupation and cannot easily get disability insurance. Premium costs vary but are typically several hundred dollars per year.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F15-surprising-insurance-policies-you-might-need&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F15%2520Surprising%2520Insurance%2520Policies%2520You%2520Might%2520Need.jpg&amp;description=15%20Surprising%20Insurance%20Policies%20You%20Might%20Need"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/15%20Surprising%20Insurance%20Policies%20You%20Might%20Need.jpg" alt="15 Surprising Insurance Policies You Might Need" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dr-penny-pincher">Dr Penny Pincher</a> of <a href="http://www.wisebread.com/15-surprising-insurance-policies-you-might-need">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-common-medicare-myths-debunked">5 Common Medicare Myths, Debunked</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/13-financial-steps-to-take-before-retiring-abroad">13 Financial Steps to Take Before Retiring Abroad</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-you-definitely-need-renters-insurance">5 Reasons You Definitely Need Renters&#039; Insurance</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-big-companies-that-offer-benefits-for-part-time-workers">9 Big Companies That Offer Benefits for Part-Time Workers</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/everything-you-need-to-know-about-flood-insurance">Everything You Need to Know About Flood Insurance</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Insurance coverage health care long term care pets protection renters insurance travel insurance valuables weddings weird insurance policies Tue, 31 Oct 2017 08:30:09 +0000 Dr Penny Pincher 2043246 at http://www.wisebread.com How to Overcome These 4 Common Retirement Fears http://www.wisebread.com/how-to-overcome-these-4-common-retirement-fears <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-overcome-these-4-common-retirement-fears" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/mature_businesswoman_portrait_in_her_office.jpg" alt="Mature Businesswoman Portrait In Her Office" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Modern retirement is a somewhat daunting prospect. Unlike previous generations, today's workers generally cannot count on a pension to fund their retirements &mdash; which means the buck stops with you when it comes to saving up the necessary money to live comfortably after you hang up your hat. Add to that the constant rhetoric about Social Security's imminent demise and the spiraling costs of health care for an aging population, and it's no wonder that thinking about retirement is heartburn-inducing.</p> <p>But even though many common retirement fears are perfectly rational, you do not have to feel overwhelmed by your concerns. Here's how you can overcome four of the most common retirement fears and plan for a fulfilling retirement.</p> <h2>I can't count on Social Security</h2> <p>The Social Security Trust Fund has been losing value since 2013, and it is projected to be entirely depleted by the year 2034. This fact is often touted as a reason for current workers to give up on the idea of receiving Social Security benefits at all once they reach full retirement age.</p> <p>After all, the Trust Fund will be empty by the time many current workers retire, and projected tax revenues will cover only 79 percent of promised benefits. This could mean anyone who is entitled to a $1,500 monthly benefit will only receive $1,185.</p> <h3>How to overcome this fear</h3> <p>While it is absolutely true that the Trust Fund will be depleted in less than 20 years, that does not mean that Social Security will simply dry up for current workers. American workers can count on Social Security to be there when they retire, no matter how old or young they are.</p> <p>Here's why you don't need to panic: To begin with, the dwindling of the Trust Fund is neither new nor imminent. It's also important to note that the United States is the only country in the world that attempts to predict the 75-year longevity of its social insurance funds, which means we are in a position to do something about the anticipated shortfall.</p> <p>Over the next couple of decades, it is likely that our government will make relatively small changes to the Social Security program in order to make up the 21 percent anticipated shortfall that will occur once the Trust Fund has run dry.</p> <p>In addition, 79 percent of promised benefits is much more than nothing. Even if we face the worst case scenario of no solution being proposed between now and 2034 (which seems unlikely, considering how popular Social Security is), there will still be something available for current workers, even if it is less than what was originally promised. (See also: <a href="http://www.wisebread.com/5-sobering-facts-about-social-security-you-shouldnt-panic-over?ref=seealso" target="_blank">5 Sobering Facts About Social Security You Shouldn't Panic Over</a>)</p> <h2>I'm going to outlive my money</h2> <p>Not having enough money in retirement is a truly frightening thought. And since it is impossible to know for certain how much money you will need in retirement, it's not possible to entirely dispel this fear, even if you have a robust retirement account.</p> <p>However, most Americans have very little money set aside for retirement. According to an Employee Benefit Research Institute survey from April 2017, 47 percent of American workers have less than $25,000 set aside for retirement. Considering the fact that it is prudent to withdraw no more than 4 percent of your nest egg per year during retirement to avoid outliving your savings, $25,000 would only net $1,000 of retirement income per year, which is nowhere near enough to live on.</p> <h3>How to overcome this fear</h3> <p>If you are among the 47 percent of American workers with less than $25,000 saved for retirement, the best way to deal with your fear of outliving your savings is to increase those savings.</p> <p>As of 2017, you can contribute up to $18,000 per year to a 401(k) or 403(b) plan, plus an additional $6,000 if you are over age 50. You may also contribute $5,500 to an IRA, plus an additional $1,000 if you are over 50. Maximizing those contributions can do a great deal to help you prepare for retirement. Even if contributing the maximum is out of your financial reach right now, upping your contribution by 1 or 2 percent can make a big difference in your nest egg's health.</p> <p>If you are already saving as much as you can for retirement and still worry about outliving your money, doing some research into the costs of what you want to do in retirement can help you overcome those fears. Knowing the real costs of retirement when you have already been a diligent saver can help you put your fears in perspective. (See also: <a href="http://www.wisebread.com/7-retirement-planning-steps-late-starters-must-make?ref=seealso" target="_blank">7 Retirement Planning Steps Late Starters Must Make</a>)</p> <h2>Illness in retirement will bankrupt me</h2> <p>According to Fidelity Benefits Consulting, the average cost of medical expenses for a 65-year-old couple retiring in 2016 will be an estimated $260,000. What's even more frightening about this enormous dollar figure is the fact that Fidelity based its calculations on 65-year-old retirees &mdash; meaning that the hypothetical retiring couple is already eligible for Medicare.</p> <p>Health care costs are undeniably high, and retirees are vulnerable to the high cost of medical care since it is difficult to shop around for better prices or stretch a fixed income. This means it's perfectly reasonable to worry that you might get sick after you retire and spend down all of your nest egg.</p> <h3>How to overcome this fear</h3> <p>It's true that health care is likely to be one of your biggest expenses in retirement, but that does not necessarily mean that an illness will bankrupt you.</p> <p>The first thing to do is learn about what you can expect from Medicare. Medicare Part A covers inpatient hospital care, home health care, and hospice care. Part B functions much like the typical health insurance you are familiar with from your workplace. Between these two, Medicare will cover about 80 percent of most of your medical needs. If you have a tough medical diagnosis, Medicare will cover your treatment, and careful money management can help you stay financially fit. (See also: <a href="http://www.wisebread.com/5-common-medicare-myths-debunked?ref=seealso" target="_blank">5 Common Medicare Myths, Debunked</a>)</p> <p>However, Medicare does not cover long-term care. This type of care &mdash; which describes the nonmedical help the elderly might need for daily living &mdash; is the aspect of your health care that can quickly overwhelm a nest egg.</p> <p><a href="http://www.wisebread.com/is-long-term-care-insurance-worth-it" target="_blank">Long-term care insurance</a> is a good option for some middle-income retirees, as it will make sure assets are protected in case you need long-term care. This kind of insurance can be pricey, however, which can put the cost out of reach for some retirees.</p> <p>If long-term care insurance is not in the cards for you, recognize that Medicaid will pay for your long-term care once you have exhausted your own resources. This is hardly an ideal option, but it can help ease your stress if you recognize that you will be able to get the care you need, no matter your financial situation.</p> <h2>I won't know who I am in retirement</h2> <p>The 2002 Jack Nicholson movie <em>About Schmidt</em> does an excellent job of showing how isolating retirement can be for some career-oriented workers. Nicholson's Warren Schmidt feels lost after retiring from several decades of working at an insurance company, and he returns to his office to try to recapture some of his sense of himself as an expert in his field, only to be brushed off by the young man who has taken his job.</p> <p>It's natural to be afraid of such a major life transition, particularly if you have always defined yourself by your career. Entering retirement without the structure of a daily routine can induce anxiety and fear, which can hardly help you to start writing your new chapter.</p> <h3>How to overcome this fear</h3> <p>One of the most important things our culture needs to do is stop looking at work and retirement as two distinct things, and start looking at them as two different parts of your whole life. Both your career and your retirement are your life, and you need to see it all as something that you can use to define yourself.</p> <p>That means structuring your life while you are working to include the things you will want to do when you are retired. For instance, if you dream of traveling in retirement, don't wait until you are retired to start your journeys. If you commit to making trips while you are still working, you will be well-prepared to be a traveler in retirement, and you will already define yourself by more than just your work.</p> <p>The best part about working to overcome this fear is that it gives you the opportunity to do the fun things you love while you are still in the midst of your career. With a little advance planning, retirement can provide a fulfilling evolution of the identity you've cultivated throughout your career.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fhow-to-overcome-these-4-common-retirement-fears&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520to%2520Overcome%2520These%25204%2520Common%2520Retirement%2520Fears.jpg&amp;description=How%20to%20Overcome%20These%204%20Common%20Retirement%20Fears"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;">&nbsp;<img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/How%20to%20Overcome%20These%204%20Common%20Retirement%20Fears.jpg" alt="How to Overcome These 4 Common Retirement Fears" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/emily-guy-birken">Emily Guy Birken</a> of <a href="http://www.wisebread.com/how-to-overcome-these-4-common-retirement-fears">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-12"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/13-financial-steps-to-take-before-retiring-abroad">13 Financial Steps to Take Before Retiring Abroad</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-face-these-7-scary-facts-about-retirement-saving">How to Face These 7 Scary Facts About Retirement Saving</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-how-your-taxes-will-change-when-you-retire">Here&#039;s How Your Taxes Will Change When You Retire</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-common-medicare-myths-debunked">5 Common Medicare Myths, Debunked</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-help-your-parents-retire">How to Help Your Parents Retire</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Retirement health care long term care medicare outliving money retirement fears social security Wed, 18 Oct 2017 08:00:07 +0000 Emily Guy Birken 2037739 at http://www.wisebread.com 5 Common Medicare Myths, Debunked http://www.wisebread.com/5-common-medicare-myths-debunked <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-common-medicare-myths-debunked" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/medicare_application_form_with_stethoscope.jpg" alt="Medicare application form with stethoscope" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>There is no larger health insurance program in the United States than Medicare. According to the Centers for Medicare &amp; Medicaid Services, more than 57 million people were receiving health benefits through the program as of March 2017.</p> <p>But just because millions are on Medicare doesn't mean that most people, especially those who have yet to hit 65, understand how this government program works. Most people instead believe several easily debunked myths about what Medicare does, how financially healthy it is, and what it doesn't do.</p> <h2>1. Medicare won&rsquo;t be around for me</h2> <p>You might worry that Medicare won't be around to cover your health care needs by the time you retire. Here's some good news: Medicare is not broke ... yet.</p> <p>The Medicare program had about $200 billion in reserves at the end of 2015. So the program does have money.</p> <p>There is some concern, though. Medicare is projected to run a surplus every year through 2020, when a growing number of Baby Boomers will start retiring. This means that Medicare will then run at an annual deficit beginning in 2021. If nothing is done to prevent this, the program will exhaust its reserves by the year 2028.</p> <p>That will be a big problem if it is allowed to happen. There are possible solutions, though, even though they will require some financial pain. The most obvious one would be to raise Medicare taxes. That won't make anyone happy, but it is the simplest way to ensure that Medicare does have enough dollars to cover all of its beneficiaries.</p> <h2>2. There's only one type of Medicare</h2> <p>Medicare is a complicated system. In fact, there are actually <em>four </em>types of Medicare coverage.</p> <p>Medicare Part A and Part B are part of what is known as original Medicare. Medicare Part A, known as hospital insurance, covers inpatient care received at hospitals and nursing facilities. Part B covers services and supplies that you need to treat health conditions. This part of Medicare covers outpatient care, preventive services, ambulance rides, and medical equipment.</p> <p>Medicare Part C is a bit more complicated: It's the part of the program that makes it possible for private health insurance companies to provide Medicare private health plans &mdash; in the form of HMOs and PPOs &mdash; known as Medicare Advantage Plans. You can elect to receive your medical benefits through a combination of Medicare Part A and Medicare Part B or from one of these private Advantage Plans. (See also: <a href="http://www.wisebread.com/8-tips-for-getting-the-most-out-of-your-medicare-plan?ref=seealso" target="_blank">8 Tips for Getting the Most Out of Your Medicare Plan</a>)</p> <p><a href="http://www.wisebread.com/how-to-compare-medicare-part-d-plans-a-beginner-s-guide" target="_blank">Medicare Part D</a> subsidizes the cost of your prescription drugs. This part of the program is often referred to as the Medicare prescription drug benefit.</p> <h2>3. You'll never have to pay for health insurance once you're on Medicare</h2> <p>Medicare will cover much of your health insurance needs. But there are some costs that you'll still need to cover on your own.</p> <p>For instance, Medicare does come with deductibles that you must pay before the insurance kicks in. These deductibles can change each year. For 2017, Medicare Part A comes with a $1,316 deductible per benefit period for your hospital stays. This means that if you do end up in the hospital, you'll have to pay this amount out of your own savings before Medicare will cover the rest of your expenses.</p> <p>Medicare Part B has a deductible of $183 for 2017. Again, you'll have to pay this amount before your Medicare coverage kicks in. And even after Part B coverage begins, you'll still have a copay. Medicare Part B generally covers 80 percent of your medical services. You'll have to cover the remaining 20 percent of these costs on your own.</p> <p>There are also coinsurance payments. If you must stay in a hospital for more than 60 days, you'll have to make a coinsurance payment for your Medicare Part A benefits.</p> <h2>4. Medicare covers all my medical needs</h2> <p>There are some medical services that Medicare does not provide any coverage for. Unfortunately, these services aren't exactly frivolous ones.</p> <p>Medicare does not provide dental coverage. It also doesn't pay for vision examinations for glasses. You can't rely on Medicare to cover the costs of dentures or hearing aids. And if you need long-term care, Medicare again won't provide coverage.</p> <p>You can purchase specialized insurance programs to cover these medical expenses. But you'll have to pay for the plans on your own. (See also: <a href="http://www.wisebread.com/is-long-term-care-insurance-worth-it?ref=seealso" target="_blank">Is Long Term Care Insurance Worth It?</a>)</p> <h2>5. I won't have to pay any premiums for Medicare</h2> <p>Most people won't pay any monthly premiums for their Medicare Part A coverage. That's the good news. The bad news? You will pay a monthly premium for Medicare Part B.</p> <p>As of 2017, the Part B premium stood at $134 a month. Medicare, though, says that most people who get Social Security benefits pay less than that, for an average monthly premium of $109. This premium is usually deducted directly from your Social Security benefits. You won't be writing a check each month, but you'll still be paying for that Part B coverage.</p> <p>You'll also have to pay a premium each month if you elect to sign up for a Medicare Part C plan. These premiums will vary depending on your plan. Medicare Part D comes with a monthly premium, too, though this will vary according to your specific plan.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F5-common-medicare-myths-debunked&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F5%2520Common%2520Medicare%2520Myths%252C%2520Debunked.jpg&amp;description=5%20Common%20Medicare%20Myths%2C%20Debunked"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/5%20Common%20Medicare%20Myths%2C%20Debunked.jpg" alt="5 Common Medicare Myths, Debunked" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/5-common-medicare-myths-debunked">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-one-question-you-need-to-answer-to-choose-the-best-health-care-plan">The One Question You Need to Answer to Choose the Best Health Care Plan</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/women-pay-more-for-health-care-heres-how-to-pay-less">Women Pay More for Health Care — Here&#039;s How to Pay Less</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/health-insurance-how-to-fight-back-against-4-common-claim-denials">Health Insurance: How to Fight Back Against 4 Common Claim Denials</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/15-surprising-insurance-policies-you-might-need">15 Surprising Insurance Policies You Might Need</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-sign-up-for-health-care-in-2018">How to Sign Up for Health Care in 2018</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Health and Beauty Insurance coverage deductibles health care medical medicare myths premiums retirement social security Thu, 05 Oct 2017 08:00:06 +0000 Dan Rafter 2030973 at http://www.wisebread.com How to Face These 7 Scary Facts About Retirement Saving http://www.wisebread.com/how-to-face-these-7-scary-facts-about-retirement-saving <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-face-these-7-scary-facts-about-retirement-saving" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/how_much_savings_will_you_need_to_retire.jpg" alt="How much savings will you need to retire" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Articles warning about our lack of retirement preparedness are a dime a dozen, and maybe that's part of the problem. We hear the warnings so often that we've become numb to them.</p> <p>Maybe packing the scariest statistics into one article will have more impact and motivate more of us to get in the retirement savings game. That's what this article is designed to do. But brace yourself: The picture isn't pretty.</p> <h2>1. You might not be saving enough</h2> <p>According to the Employee Benefit Research Institute (EBRI), about two out of every five workers today (44 percent) are not saving <em>any</em> money for retirement. None.</p> <p>Even among today's oldest workers &mdash; those closest to retirement &mdash; many have far too little saved for their later years. Among workers age 55 or older, 45 percent have less than $100,000 saved.</p> <p>If these folks really kick their savings into gear &mdash; let's say they end up with $250,000 by the time they finish their career &mdash; that still won't provide much to live on. A standard <a href="http://www.wisebread.com/4-retirement-rules-of-thumb-that-actually-work?ref=internal" target="_blank">retirement rule of thumb</a> says you can withdraw 4 percent of your nest egg every year without having to worry about draining your account before you die. At $250,000, that translates into just $10,000 of annual retirement income. (See also: <a href="http://www.wisebread.com/10-signs-you-arent-saving-enough-for-retirement?ref=seealso" target="_blank">10 Signs You Aren't Saving Enough for Retirement</a>)</p> <h2>2. You might outlive your money</h2> <p>Among the many risks financial planners talk about is <em>longevity risk</em>; the danger of living a long life. It may sound kind of funny to frame that as a risk since most of us would <em>like </em>to live a long life. However, running out of money before you run out of time wouldn't be very funny at all.</p> <p>A man who is 65 years old today can expect to live another 19.2 years, according to the Social Security Administration's Life Expectancy Calculator. A 65-year-old woman can expect to live another 21.6 years.</p> <p>Are you on track to save enough to cover your retirement expenses that long?</p> <h2>3. If you're young, you're probably not saving aggressively enough</h2> <p>Many millennials &mdash; people with the best opportunity to take advantage of compounding interest &mdash; are investing far too conservatively. A 2014 UBS Investor Watch survey found that millennials were almost as likely as baby boomers to describe their risk tolerance as conservative. The same survey found millennials holding over half their assets in cash.</p> <p>When you're young, the riskiest thing you can do with your investments is to play it too safe. Doing so will make it hard to outpace inflation and you'll miss out on much of the growth that compounding can provide. (See also: <a href="http://www.wisebread.com/5-facts-millennials-should-know-about-retirement-planning?ref=seealso" target="_blank">5 Facts Millennials Should Know About Retirement Planning</a>)</p> <h2>4. You can't count on Social Security to fill in much of the gap</h2> <p>As of July 2017, the average Social Security retirement benefit was just $1,325 per month. Even scarier, the Social Security Administration notes that Social Security provides 90 percent or more of the income received by about one in five elderly married couples, and two in five elderly singles.</p> <p>A big part of the problem is that many people claim benefits as soon as they qualify &mdash; age 62. That guarantees the lowest possible monthly benefit. Waiting until full retirement age (67 for anyone born in 1960 or later), or even better, age 70, will boost monthly benefits substantially. (See also: <a href="http://www.wisebread.com/6-smart-ways-to-boost-your-social-security-payout-before-retirement?ref=seealso" target="_blank">6 Smart Ways to Boost Your Social Security Payout Before Retirement</a>)</p> <h2>5. You shouldn't count on working for pay in your later years</h2> <p>Plan B for a growing number of today's workers is to retire after the typical retirement age of 65. For many, it isn't that they love their job so much; it's that they know they'll need the money.</p> <p>But their aspirations don't match reality. According to EBRI, 52 percent of today's workers <em>expect</em> to retire after age 65 or never retire, whereas just 14 percent of today's over-65 crowd <em>actually</em> retired that late or never retired.</p> <p>In fact, 48 percent of today's retirees left the workforce <em>earlier</em> than planned &mdash; mostly due to health issues or the need to care for a loved one.</p> <h2>6. You may have no idea how much you should be saving for retirement</h2> <p>EBRI found that just 41 percent of all of today's workers have tried to figure out how much they will need to have saved by the time they retire in order to live comfortably. Those that <em>have</em> run the numbers tend to save more for retirement. (See also: <a href="http://www.wisebread.com/this-one-thing-could-be-the-key-to-retiring-rich?Ref=seealso" target="_blank">This One Thing Could Be the Key to Retiring Rich</a>)</p> <h2>7. You may not be able to afford your later life health care costs</h2> <p>A recent Fidelity study found that a couple retiring this year would need $275,000 to cover their health care premiums, copays, deductibles, and out-of-pocket costs for prescription drugs over the course of their retirement. (See also: <a href="http://www.wisebread.com/9-unexpected-expenses-for-retirees-and-how-to-manage-them?ref=seealso" target="_blank">9 Unexpected Expenses for Retirees &mdash; And How to Manage Them</a>)</p> <p>What that figure <em>doesn't </em>include is long-term care, and yet, today's 65-year-olds have a 70 percent chance of needing some type of long-term care before they die, according to the U.S. Department of Health and Human Services. And that care is costly. Genworth's latest annual Cost of Care survey found that a private room in a nursing home cost nearly $7,700 per month in 2016, or over $92,000 per year. (See also: <a href="http://www.wisebread.com/is-long-term-care-insurance-worth-it?ref=seealso" target="_blank">Is Long Term Care Insurance Worth It?</a>)</p> <p>If these scary statistics have convinced you to take action, here are three of the most important steps to take: Run the numbers to figure out how much you should be saving for retirement, make saving a priority, and wait at least until full retirement age before claiming Social Security benefits.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fhow-to-face-these-7-scary-facts-about-retirement-saving&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520to%2520Face%2520These%25207%2520Scary%2520Facts%2520About%2520Retirement%2520Saving.jpg&amp;description=How%20to%20Face%20These%207%20Scary%20Facts%20About%20Retirement%20Saving"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/How%20to%20Face%20These%207%20Scary%20Facts%20About%20Retirement%20Saving.jpg" alt="How to Face These 7 Scary Facts About Retirement Saving" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/matt-bell">Matt Bell</a> of <a href="http://www.wisebread.com/how-to-face-these-7-scary-facts-about-retirement-saving">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-age-milestones-that-impact-your-retirement">6 Age Milestones That Impact Your Retirement</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-signs-its-time-to-retire">8 Signs It&#039;s Time to Retire</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-retirement-planning-changes-when-youre-single">7 Ways Retirement Planning Changes When You&#039;re Single</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-overcome-these-4-common-retirement-fears">How to Overcome These 4 Common Retirement Fears</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-tax-day-is-april-15-and-other-weird-financial-deadlines">Why Tax Day Is April 15 and Other Weird Financial Deadlines</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Retirement 401(k) expenses health care IRA not saving enough outliving money scary facts social security Wed, 04 Oct 2017 09:00:06 +0000 Matt Bell 2030771 at http://www.wisebread.com How the Self Employed Can Cut Health Care Costs http://www.wisebread.com/how-the-self-employed-can-cut-health-care-costs <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-the-self-employed-can-cut-health-care-costs" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/medical_costs.jpg" alt="Medical Costs" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>When you run your own business, times like the present &mdash; when there is a lot of uncertainty about health care policy &mdash; can be challenging. Many self-employed Americans are already struggling to pay for insurance and medical costs. And it's hard to predict whether your premiums or out-of-pocket costs will rise substantially in the near future.</p> <p>So how do you insulate yourself? There isn't an easy answer, as I found during the roughly 10-year period when my husband and I were both freelancers raising four children in New Jersey, a very high-cost state when it comes to health care. (Last fall, he went in-house with a client, so now we get our health care through his job.) This is what worked for us.</p> <h2>Opt for a high-deductible plan with a health savings account</h2> <p>When it comes to health insurance, many people prefer plans that cover most of their out-of-pocket costs &mdash; such as a preferred provider organization (PPO) plan. Unfortunately, the premiums for these tend to be extremely high. For us, enrolling in a PPO plan would have been like taking on a second mortgage. (See also: <a href="http://www.wisebread.com/the-one-question-you-need-to-answer-to-choose-the-best-plan-on-the-health-care-marketplace?ref=seealso" target="_blank">The One Question You Need to Answer to Choose the Right Health Care Plan</a>)</p> <p>If you don't use a lot of medical care, you may find yourself over-insured with a PPO plan. Generally, if you're self-employed, the most affordable option is a high-deductible health care plan (HDHP), which allows you to open and use a <a href="http://www.wisebread.com/how-an-hsa-saves-you-money?ref=internal" target="_blank">health savings account (HSA)</a>.</p> <p>The premiums for an HDHP tend to be lower than those for a PPO plan. Like most health care plans, an HDHP will completely cover preventive health services such as routine physicals and vaccinations &mdash; meaning you don't pay anything. However, there's a catch. Outside of preventive care, with a high-deductible plan you need to pay a certain dollar amount of medical costs &mdash; your deductible &mdash; before the plan starts covering your medical expenses. Often the deductible for an HDHP is thousands of dollars.</p> <p>A health savings plan can help you save for those medical costs in a tax-advantaged account, which is only available to people who have an HDHP. To use a health savings plan, your insurance plan's annual deductible in 2017 must be at least $1,300 if you're an individual, or $2,600 per year for a family plan (these numbers are adjusted every year).</p> <p>Putting that money into a health savings account on a pretax basis can reduce your taxable income. Because this helps cut your tax bill, there are, of course, limits to how much you can contribute ($3,400 for yourself only, or $6,750 for a family plan). You can use the money you put into the HSA to pay your medical expenses with a special debit card or checkbook you get when you open the account. The IRS publishes a <a href="https://www.irs.gov/pub/irs-pdf/p502.pdf" target="_blank">list of expenses you can use an HSA for</a>. (See also: <a href="http://www.wisebread.com/10-reasons-an-hsa-is-actually-worth-having?ref=seealso" target="_blank">10 Reasons an HSA Is Actually Worth Having</a>)</p> <p>To be sure, it is not easy to come up with the money to fund an HSA, especially if you are a freelancer with uneven income. We have funded ours by cutting down on extras. Sometimes making a small change, like switching to a better mobile phone plan, can make a difference. Even if you can only put in a quarter of the amount you're allowed and gradually increase the amount you contribute each year, you'll be further ahead than if you don't put anything into an HSA.</p> <h2>Get second opinions and shop around</h2> <p>There have been many cases over the years where the medical community has revised evidence-based recommendations as new information has become available for treating particular conditions. Given that reality, I've realized that there are many gray areas in medicine and have taken time to get second opinions any time a family member is advised to get a test or treatment that comes with risks or could be very costly. Sometimes, the doctor giving me a second opinion will suggest a way to tackle a problem using a simpler, less expensive solution that I haven't considered.</p> <p>I've found that functional medicine doctors can be fantastic allies in this respect. These MDs tend to be oriented toward finding the root cause of a problem so you can eliminate it, rather than simply treating the symptoms. Some don't take insurance, but there are a few who do, so it's worth asking health-oriented friends if they know one.</p> <p>Sometimes, it's even possible to shop around for medical procedures, despite the general lack of transparency in U.S. health care costs. I haven't personally used it, but the site <a href="https://www.mdsave.com/" target="_blank">MDsave</a>, which one entrepreneur highly recommended to me, allows you to compare prices and pay for medical procedures in advance at prearranged prices. There are also a number of other websites that let you compare medical costs.</p> <h2>Live a healthy lifestyle</h2> <p>None of us has total control over our health, but by doing what you can to eat well and stay fit, you can at least reduce your chances of developing health problems that have a lifestyle component or mitigate the harm they cause if you already have developed one.</p> <p>Many chronic conditions can be very costly, as a recent survey by the International Foundation of Employee Benefit Plans pointed out. Employers who completed the survey said the number one condition impacting their medical costs was diabetes, cited by 41 percent of respondents. Obesity, heart disease, and hypertension/high blood pressure were also among the top 10 medical costs.</p> <p>Two simple things you can do to stack the odds in favor of staying healthy, without any added expense, are buying fresh, unprocessed foods and preparing your food at home as often as you can. When you eat a lot of prepared frozen foods or eat out all the time, it's hard to avoid unhealthy ingredients, unless you can afford the highest-end options. (See also: <a href="http://www.wisebread.com/are-meal-prep-subscription-boxes-worth-it?ref=seealso" target="_blank">Are Meal Prep Subscription Boxes Worth It?</a>)</p> <p>The less-is-more approach can work with fitness, too. Instead of waiting for that perfect day when you can afford to sign up for a CrossFit or Barre class and do it regularly, find some type of enjoyable physical activity that is available to you now, whether that's taking a yoga class at your YMCA, going for a walk or jog around your neighborhood, or playing actively with your kids. And if you participate in an activity that gets you away from your computer, you'll probably meet some new friends, too, which is another good way to reduce stress. (See also: <a href="http://www.wisebread.com/10-lifestyle-changes-that-will-always-pay-off?ref=seealso" target="_blank">10 Lifestyle Changes That Will Always Pay Off</a>)</p> <p>These steps do take some effort, but they can pay off in lower health care costs. That's a big benefit if you're paying for your premiums and medical bills on your own.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fhow-the-self-employed-can-cut-health-care-costs&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHow%2520the%2520Self%2520Employed%2520Can%2520Cut%2520Health%2520Care%2520Costs.jpg&amp;description=How%20the%20Self%20Employed%20Can%20Cut%20Health%20Care%20Costs"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/How%20the%20Self%20Employed%20Can%20Cut%20Health%20Care%20Costs.jpg" alt="How the Self Employed Can Cut Health Care Costs" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/elaine-pofeldt">Elaine Pofeldt</a> of <a href="http://www.wisebread.com/how-the-self-employed-can-cut-health-care-costs">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/11-surprising-things-your-hsa-will-cover">11 Surprising Things Your HSA Will Cover</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-vital-things-to-remember-when-buying-health-insurance">5 Vital Things to Remember When Buying Health Insurance</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-reasons-an-hsa-is-actually-worth-having">10 Reasons an HSA Is Actually Worth Having</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-one-question-you-need-to-answer-to-choose-the-best-health-care-plan">The One Question You Need to Answer to Choose the Best Health Care Plan</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-common-medicare-myths-debunked">5 Common Medicare Myths, Debunked</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship Health and Beauty Insurance freelancers hdhp health care health savings accounts healthy living high deductible plans HSA medical care PPO self employed small business owners Tue, 03 Oct 2017 08:30:11 +0000 Elaine Pofeldt 2028483 at http://www.wisebread.com 7 Things You Need to Know About Pet Insurance http://www.wisebread.com/7-things-you-need-to-know-about-pet-insurance <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-things-you-need-to-know-about-pet-insurance" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/This_is_not_a_chew_toy.jpg" alt="This isn&#039;t a chew toy" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Do you need pet insurance? That depends. It can mean life or death for your pet if they experience a major medical issue &mdash; especially an expensive one that requires hospitalization or emergency surgery &mdash; but it can seem like an unnecessary monthly expense if you're paying into the plan and not using it. To make a decision whether pet insurance is right for you, here are a few things you should know. (See also: <a href="http://www.wisebread.com/is-pet-health-insurance-worth-it?ref=seealso" target="_blank">Is Pet Health Insurance Worth It?</a>)</p> <h2>1. There are three types of pet health coverage</h2> <p>Most pet insurance companies break down coverage into three categories. The lowest tier is an accident-only plan, which only covers accidents and emergencies, like if your dog gets hurt by another dog at the park. This coverage does not include any hereditary issues or serious health conditions. Conversely, there's a wellness plan, which doesn't include anything that the accident-only plan includes, but rather focuses on wellness and routine care, like annual exams, dental cleanings, and routine medications, like heartworm and flea-and-tick prevention.</p> <p>Two plans that don't overlap anywhere kind of force pet parents into the all-encompassing third option, and that's where the more expensive, major medical plans come in.</p> <p>More than 90 percent of all pet insurance plans purchased are in this category, according to PetInsuranceQuotes.com, which helps users compare coverage and prices among leading providers. It's likely major medical plans are so popular because they cover everything <em>except</em> wellness and routine care. Accidents, illnesses, cancer, orthopedic issues, hereditary conditions, and prescription meds are under the veil of these plans, the price of which is mostly determined by the breed of pet you have.</p> <h2>2. Pet insurance can help you avoid major debt</h2> <p>For many pet parents, putting an animal down when an expensive health issue strikes just isn't an option. They'll use any means possible to come up with the money to keep their pet alive. Using money from your emergency fund if it's readily available is one thing, but putting the bill on a credit card when money is already tight just isn't smart.</p> <p>Pet insurance, however, can eliminate that issue altogether. You'll pay a small amount each month so you don't have to experience even greater stress about your finances when your pet is in the hospital. The premium is probably worth the peace of mind. (See also: <a href="http://www.wisebread.com/5-pet-costs-you-dont-see-coming?ref=seealso" target="_blank">5 Pet Costs You Don't See Coming</a>)</p> <h2>3. Having coverage could mean saving your pet's life</h2> <p>When I first moved to Manhattan, barely able to pay my bills, my husband wanted a dog. I was dead-set against it, but his continued pleas caused me to cave, and before I knew it, we had a rambunctious puppy.</p> <p>Fast forward to a year-and-a-half later, still struggling to make ends meet, and our dog Jaxon is rushed to the hospital with a respiratory infection that cost about $8,000. There was a brief period of time when we weren't sure if our pet insurance would cover the cost of treatment &mdash; or how much we would have to spend out-of-pocket &mdash; and we had to make a tough decision. It was a quick decision. We could afford up to $3,000 in out-of-pocket expenses and nothing more; otherwise we would have to say our goodbyes. Thankfully we didn't have to, because the little bugger is still my best bud. Pet insurance saved Jaxon's life that day, and it could very well save your pet's life, too. (See also: <a href="http://www.wisebread.com/6-pet-expenses-you-should-never-skip?ref=seealso" target="_blank">6 Pet Expenses You Should Never Skip</a>)</p> <h2>4. Age plays an important part in the coverage you'll get</h2> <p>It's important to enroll your pet while they're young and healthy enough to get the best coverage at the lowest price. No pet insurance provider will cover pre-existing conditions, which makes getting coverage as the pet ages tougher and more expensive, if possible at all.</p> <p>&quot;If your pet is a senior and/or has pre-existing conditions, you may want to consider the accident-only plan,&quot; says Chris Middleton, president of Pets Best, a leading pet insurance provider. &quot;Or get the accident-only plan and add routine care to it.&quot;</p> <p>I decided to end major medical coverage on Jaxon because he doesn't go anywhere that he'll get hurt and he hasn't had any major medical issues for years; that level of insurance was becoming an expense that wasn't worth it. He's also getting up there in age, and at some point I have to let nature take its course. For now, he's happy, healthy, and we're enjoying life together.</p> <h2>5. Your pet's breed will influence coverage and cost</h2> <p>Some pet breeds are more prone to hereditary conditions and medical issues than others, which will affect the price you'll pay for pet insurance right off the bat. For example, you can expect to pay an average of $45 a month for a Labrador retriever versus $53 a month for an English bulldog, according to PetInsuranceQuotes.com. Both of these breeds come with their own set of hereditary issues that can be expensive to treat, which affect prices. If you know you want pet insurance but haven't found the perfect pet yet, it's worth researching insurance premiums based on breed; it may inform your decision on what breeds to focus on and which to avoid. (See also: <a href="http://www.wisebread.com/8-ways-to-lower-your-vet-bills?ref=seealso" target="_blank">8 Ways to Lower Your Vet Bills</a>)</p> <h2>6. Find the coverage that works best for your pet and your wallet</h2> <p>To get the most for your pet insurance price, look for a provider that covers the largest portion of your veterinary bill, coverage for congenital and hereditary conditions, and has no limits to the amount they will pay out.</p> <p>&quot;Choose a deductible that fits your budget and how they are applied,&quot; adds pet insurance provider Trupanion. &quot;Deductibles can help you control your premiums while making sure you see coverage before you hit your budget limit.&quot;</p> <h2>7. Pet insurance usually works on a reimbursement model</h2> <p>Pet insurance is a reimbursement model, meaning the pet owner pays their bill at the veterinarian (and often you must pay it in full before your pet is allowed to leave the facility), then submit the proof of payment to the provider for reimbursement. You should research the company's options for submitting claims before choosing a provider, advises Middleton.</p> <p>&quot;Since pet insurance is a reimbursement model, getting your money back quickly is one of the most important features,&quot; Middleton says. &quot;It's also important to look at how they will reimburse you. Some companies will only cut a check to pay your claim; so you have to factor in the time to cut the check, get it mailed to you, then deposit it.&quot;</p> <p>Direct-deposit reimbursement also is available at some providers.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F7-things-you-need-to-know-about-pet-insurance&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F7%2520Things%2520You%2520Need%2520to%2520Know%2520About%2520Pet%2520Insurance.jpg&amp;description=7%20Things%20You%20Need%20to%20Know%20About%20Pet%20Insurance"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/7%20Things%20You%20Need%20to%20Know%20About%20Pet%20Insurance.jpg" alt="7 Things You Need to Know About Pet Insurance" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/7-things-you-need-to-know-about-pet-insurance">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-pet-expenses-you-should-never-skip">6 Pet Expenses You Should Never Skip</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-ways-to-lower-your-vet-bills">8 Ways to Lower Your Vet Bills</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-personal-finance-tips-for-animal-lovers">7 Personal Finance Tips for Animal Lovers</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-5-best-pet-flea-shampoos">The 5 Best Pet Flea Shampoos</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-unexpected-dog-costs-you-should-prepare-for-now">5 Unexpected Dog Costs You Should Prepare for Now</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Family Health and Beauty cats dogs health care pet care pet insurance pet owner pets vet bills veterinary bills Fri, 15 Sep 2017 08:30:11 +0000 Mikey Rox 2020340 at http://www.wisebread.com Here's How You Should Budget Your Social Security Checks http://www.wisebread.com/heres-how-you-should-budget-your-social-security-checks <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/heres-how-you-should-budget-your-social-security-checks" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/united_states_treasury_government_check.jpg" alt="United States Treasury government check" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The average retired worker earns a monthly Social Security check of $1,360, according to the U.S. Social Security Administration. And for most retirees, Social Security benefits are just one source of income, with many supplementing their checks with money that they've saved in 401(k) plans, IRAs, and other savings vehicles.</p> <p>This doesn't mean, though, that these Social Security dollars aren't important. The administration says that Social Security benefits represent about 34 percent of the income of the elderly. That's why it's so important for retirees to create a budget for their Social Security benefits and determine the best way to spend such a significant portion of their monthly earnings. (See also: <a href="http://www.wisebread.com/6-smart-ways-to-boost-your-social-security-payout-before-retirement?ref=seealso" target="_blank">6 Smart Ways to Boost Your Social Security Payout Before Retirement</a>)</p> <h2>There's always a need for a budget</h2> <p>The first step in determining how to best spend Social Security benefits is to calculate your monthly income from all sources. Then, determine how much of this income comes from Social Security benefits alone. If Social Security accounts for 70 percent of your monthly income, you'll have to be especially careful how you spend it. If it accounts for just 20 percent, you'll have a bit more leeway.</p> <p>Once you determine how important your benefits are to your monthly income stream, it's time to calculate how much of your Social Security check you should devote to each of your main expenses. (See also: <a href="http://www.wisebread.com/6-ways-you-can-cut-costs-right-before-you-retire-0?ref=seealso" target="_blank">6 Ways You Can Cut Costs Right Before You Retire</a>)</p> <h2>Housing</h2> <p>Ideally, you'll enter retirement without a mortgage payment. But that doesn't always happen. You might choose to rent during your retirement years. Or, maybe you'll spend your retirement years in assisted living.</p> <p>Housing often remains a significant expense for retirees, with the Bureau of Labor Statistics reporting in March 2016 that seniors age 55 and older spend an average $16,219 a year on housing. Seniors from the ages of 65 to 74 spend an average $15,838.</p> <p>If you receive the average Social Security check of $1,360 a month, you'll receive $16,320 a year. This means that the average amount that retirees spend on housing would consume most of your Social Security income each year.</p> <p>It might make sense to devote a set percentage of every Social Security check to help cover your housing expenses. How much that percentage is will depend on how much you are spending on housing. If you live in a home with a mortgage that's been paid off, you obviously won't need to spend as much of your checks on housing as you would if you were still paying a mortgage. If housing is a significant expense, though, you might consider devoting 60 percent or more of your Social Security check to covering it. (See also: <a href="http://www.wisebread.com/5-countries-where-you-can-retire-for-1000-a-month?ref=seealso" target="_blank">5 Countries Where You Can Retire for $1,000 a Month</a>)</p> <h2>Food</h2> <p>The Bureau of Labor Statistics reported that seniors from the ages of 65 to 74 spend an average $6,303 a year on food. This makes sense: You have to eat, whether you're working or not. Make sure, then, to reserve part of your Social Security check for groceries and meals out.</p> <p>You do have control over this expense, of course. You can eat out less often and cook at home more, which would reduce your food expenses. But setting aside 20 percent or so of your monthly Social Security check for food should suffice.</p> <h2>Medical expenses</h2> <p>Depending on your health, medical costs could be a significant expense as you age. The numbers from the Bureau of Labor Statistics bear this out. According to the Bureau, adults from the ages of 65 to 74 spend an average $5,956 a year for medical care. The Bureau says that adults 74 and older spend an average $5,708 a year on health care. (See also: <a href="http://www.wisebread.com/how-an-hsa-could-help-your-retirement?ref=seealso" target="_blank">How an HSA Could Help Your Retirement</a>)</p> <p>Health expenses are one cost you have little control over. Sure, you can exercise and eat well. But you might still suffer health setbacks. It's important to reserve at least some of your Social Security check to cover these sometimes unexpected costs.</p> <p>Consider saving an additional 20 percent of your Social Security benefits for medical spending.</p> <h2>Other costs</h2> <p>If you've been keeping track, those three expenses might eat up your entire Social Security check. Again, this depends on how much Social Security income you receive each month and how much you actually spend on housing, health care, and food. (See also: <a href="http://www.wisebread.com/how-much-can-you-afford-to-spend-in-retirement?ref=seealso" target="_blank">How Much Can You Afford to Spend in Retirement?</a>)</p> <p>If you find that these three big expenses do swallow most or all of your expenses, you'll have to dip into your retirement savings and other income vehicles to cover costs such as travel, transportation, entertainment, and any other monthly bills.</p> <p>Budgeting your Social Security check highlights just how important it is to have multiple income sources at your disposal after retirement. As you can see, Social Security doesn't go that far when it comes to covering the basic living expenses of many seniors.</p> <p>You do have options, of course. You can scale back your retirement plans, perhaps choosing to travel less and eat in more often. You can also take on a part-time job. That extra income could come in handy to cover the smaller, unexpected expenses that tend to come up. (See also: <a href="http://www.wisebread.com/9-easy-ways-retirees-can-earn-extra-income?ref=seealso" target="_blank">9 Easy Ways Retirees Can Earn Extra Income</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fheres-how-you-should-budget-your-social-security-checks&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHeres%2520How%2520You%2520Should%2520Budget%2520Your%2520Social%2520Security%2520Checks.jpg&amp;description=Here's%20How%20You%20Should%20Budget%20Your%20Social%20Security%20Checks"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/Heres%20How%20You%20Should%20Budget%20Your%20Social%20Security%20Checks.jpg" alt="Here's How You Should Budget Your Social Security Checks" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/heres-how-you-should-budget-your-social-security-checks">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-ways-couples-are-shortchanging-their-retirement-savings">4 Ways Couples Are Shortchanging Their Retirement Savings</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-american-cities-where-you-can-retire-on-just-social-security">5 American Cities Where You Can Retire On Just Social Security</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-face-these-7-scary-facts-about-retirement-saving">How to Face These 7 Scary Facts About Retirement Saving</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-retiring-with-debt-isnt-the-end-of-the-world">Why Retiring With Debt Isn&#039;t the End of the World</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-almost-anyone-can-afford-to-retire-in-mexico">How Almost Anyone Can Afford to Retire in Mexico</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting Retirement beneficiaries benefits expenses food costs health care housing income medical costs social security Wed, 23 Aug 2017 08:30:05 +0000 Dan Rafter 2007581 at http://www.wisebread.com The One Question You Need to Answer to Choose the Best Health Care Plan http://www.wisebread.com/the-one-question-you-need-to-answer-to-choose-the-best-health-care-plan <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-one-question-you-need-to-answer-to-choose-the-best-health-care-plan" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-515605374.jpg" alt="Choosing the best health care plan based on one question" title="" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>Health insurance: That term alone may be enough to give you a headache, considering all of its confusing language, acronyms, high costs, and pages upon pages of fine print. If you're feeling lost, you aren't alone &mdash; and I'm here to help.</p> <p>As someone who has purchased their own insurance from health care marketplaces in several states, and worked professionally for a health insurance company, I've learned quite a bit about buying health insurance. Here are the main points you need to know to choose the best insurance plan for you and your family.</p> <h2>The two main health care costs</h2> <p>Health care costs are broken down into two main categories: fixed monthly costs and variable service costs.</p> <h3>1. Fixed monthly costs</h3> <p>Your health care bill is a fixed monthly cost that you pay in order to keep your insurance in good standing. Your bill is often referred to as your &quot;premium&quot; or &quot;monthly premium.&quot; It may change from year to year, but within a given calendar year, it's the same every month provided you don't have any life changes such as adding a new dependent to your plan.</p> <p>It's critically important that you pay this monthly charge every month when it's due. If you miss a payment or multiple payments, the insurance company could cancel your coverage or charge you a late fee. If you're having trouble paying your monthly premium, ask for help. Call your insurance company. There are often programs and payment options to help you manage your payments and keep your insurance active.</p> <h3>2. Variable service costs</h3> <p>These are costs that you will pay when you receive medical services such as doctor visits, prescriptions, visits to the emergency room or hospitalizations, and lab tests, just to name a few. The costs to you for these services depend upon your insurance and the provider of those services such as the doctor or pharmacy you use. When you pay these costs, they count against something called your deductible.</p> <p>Your deductible is the amount of money set by your insurance plan that <em>you </em>must pay before insurance contributes money to your medical costs.</p> <p>Your copay is the amount of money you must pay upfront to a service provider before you can receive care, medication, or tests.</p> <h2>An example of how all of these costs work together</h2> <p>Let's say you sign up with ABC health insurance company. These are the terms of the plan:</p> <ul> <li>Monthly premium: $100.<br /> &nbsp;</li> <li>Variable costs: $25 copay for a visit to your doctor (often called your primary care physician or PCP), $200 copay for a visit to the ER, $10 copay for prescriptions.<br /> &nbsp;</li> <li>Deductible: $1,000 in-network, $2,000 out-of-network. In-network means that a provider is approved by the insurance company. As a general rule, you should check to see if all of your providers are in-network with your insurance company, because in-network providers will be cheaper for you than out-of-network providers.</li> </ul> <p>Every month, you must pay the $100 premium, whether or not you receive any medical care that month.</p> <p>Now let's say you get a bad cold. You go to the doctor and they write you a prescription for some medicine to help you manage the congestion in your nose and chest. They're also a little concerned that this is more than just a cold, so they recommend a few tests from an in-network lab. Since you are feeling very sick, you agree to the lab tests. You pay the $25 copay to the doctor for the visit, and the $10 copay at your pharmacy for the prescription. Total variable costs so far are $35.</p> <p>The lab tests come back and it turns out you have an infection and need a second prescription. You pay another $10 copay to your pharmacist for the second medication, and the lab that ran the tests sends you a bill for $50. Total variable costs are now a total of $95.</p> <p>Now what about the deductible? Copays usually do not count toward your deductible, but billed costs do. Let's say this is the first time you're seeing a doctor this year. You can count your $50 lab cost against your $1,000 in-network deductible because the lab that ran the tests is in-network.</p> <p>Because you haven't yet hit the $1,000 in-network deductible of medical expenses, you must pay the lab the $50 for your lab tests. Your insurance doesn't cover any of that cost so long as your total billed in-network provider costs for the year (not counting copays) are below $1,000. Insurance does not cover any of your copays &mdash; you are responsible for those costs as well.</p> <h2>The one question you need to answer to choose the right plan</h2> <p>Health care is a complicated industry. There is one main question you need to answer to choose the right plan for you on the exchange: Would you rather pay a higher fixed monthly premium and pay lower costs for a serious illness or injury, or would you rather have a lower monthly premium and pay higher costs for a serious illness or injury?</p> <p>Once you answer that question, you significantly narrow down your choices and the decision becomes much simpler.</p> <h2>Narrowing down your choices</h2> <p>If you need some help answering the question above, here is a way to break it down into two smaller questions.</p> <h3>1. What is your risk tolerance?</h3> <p>You have to be able to sleep at night. If you are worried about a high monthly premium and not too worried about your potential for getting sick or having some kind of accident, then you could choose a higher-deductible plan with a lower monthly fee and higher service fees. If you would rather have the peace of mind of a lower-deductible plan with higher monthly fees and lower service fees, then a high monthly premium plan may be better for you. That is a very personal choice and there are no right or wrong answers.</p> <h3>2. How much financial flexibility do you have if you get sick or injured?</h3> <p>Another point to consider is your financial flexibility. In the event that you become sick or have an accident, do you have a substantial enough savings to cover high medical costs? If so, then you may be just fine with a plan that is cheaper on a monthly basis and has higher fees and a higher deductible. If you don't have significant savings for services, but you do have money to cover a higher monthly premium, then a more expensive plan upfront may be better for you.</p> <h2>What's covered in every plan (for now)</h2> <p>For now, the Affordable Care Act (commonly called the ACA or &quot;Obamacare&quot;) is the law of the land. When it was passed in 2010, it included a required set of services that all health insurance plans on the marketplace (also called &quot;the exchange&quot;) must include.</p> <p>That means that all of these services must be offered by all plans that wish to be a part of the marketplace. It does not mean that these services are free of charge. It just means that they have to be offered as part of the bundle of services, and there can be costs to you associated with them.</p> <p>The mandatory services, as long as the ACA is in effect, are:</p> <ul> <li>Ambulatory patient services. This includes any service outside of a hospital such as visits to a doctor's office, a clinic, or urgent care center.<br /> &nbsp;</li> <li>Chronic disease treatment. Chronic conditions are illnesses that must be consistently treated to prevent or slow their progression, but may never be fully cured. These include conditions such as diabetes and high blood pressure.<br /> &nbsp;</li> <li>Emergency services.<br /> &nbsp;</li> <li>Hospitalization.<br /> &nbsp;</li> <li>Laboratory services. Lab services include all tests that help doctors diagnose your illness or condition. Blood work is an example of a lab service.<br /> &nbsp;</li> <li>Maternity and newborn care.<br /> &nbsp;</li> <li>Mental health services and addiction treatment. This includes services in which you go for an office visit to a therapist as well as services that require you to check in to a facility for multiple days of treatment (known as inpatient services).<br /> &nbsp;</li> <li>Rehabilitative services and devices. This includes services that help you to recover from a mental or physical illness, injury, disability, or chronic condition. It may be inpatient or outpatient depending upon the recommendation by your physician.<br /> &nbsp;</li> <li>Pediatric services. This includes checkups, vaccines and immunizations, dental care, and vision care.<br /> &nbsp;</li> <li>Prescription drugs.<br /> &nbsp;</li> <li>Preventive and wellness services. This includes physicals, immunizations, and screenings such as mammograms and colonoscopies that are meant to prevent and/or detect certain medical conditions that would need treatment. For women, this also includes annual visits to a gynecologist. Many times these services are included in the insurance plan with no extra fee other than a copay provided you go to a service provider who is in-network.</li> </ul> <p>Remember, no matter which plan you choose on the exchange, it must include some provision for these services though the costs to you for providing them may vary significantly from plan to plan.</p> <h2>The main drivers of your health insurance costs</h2> <p>There are several factors that determine your monthly charge from the insurance company.</p> <ul> <li>Your age.<br /> &nbsp;</li> <li>Your home address. Where you live makes a difference in cost, for now, so you must go to the marketplace that is associated with the state in which you live. <a href="https://www.healthcare.gov/" target="_blank">HealthCare.gov</a> will tell you which exchange is yours based on the ZIP code you enter. You will then be able to see the plans available to you.<br /> &nbsp;</li> <li>How many dependents you want to cover, if any.<br /> &nbsp;</li> <li>Whether or not you smoke. Some states have an extra charge if you are a smoker.<br /> &nbsp;</li> <li>The insurance company you choose. Exchanges can have more than one insurance company in the marketplace.</li> </ul> <p>The health care exchanges do an excellent job of giving you side-by-side, apples-to-apples comparisons between different plans. If it's too much for you to figure out online, call your state exchange directly. They have excellent customer service representatives who are very knowledgeable and will help you through the online application. Be well.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/The%20One%20Question%20You%20Need%20to%20Answer%20to%20Choose%20the%20Best%20Plan%20on%20the%20Health%20Care%20Marketplace.jpg" alt="The One Question You Need to Answer to Choose the Best Plan on the Health Care Marketplace" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/christa-avampato">Christa Avampato</a> of <a href="http://www.wisebread.com/the-one-question-you-need-to-answer-to-choose-the-best-health-care-plan">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-sign-up-for-health-care-in-2018">How to Sign Up for Health Care in 2018</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/health-insurance-how-to-fight-back-against-4-common-claim-denials">Health Insurance: How to Fight Back Against 4 Common Claim Denials</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-vital-things-to-remember-when-buying-health-insurance">5 Vital Things to Remember When Buying Health Insurance</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/signing-up-for-obamacare-in-2015-heres-whats-new">Signing Up for Obamacare in 2015? Here&#039;s What&#039;s New</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/going-without-health-insurance-in-2015-heres-what-itll-cost-you">Going Without Health Insurance in 2015? Here&#039;s What It&#039;ll Cost You</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Health and Beauty Insurance ACA affordable care act copays costs deductibles doctors health care networks obamacare the exchange Tue, 08 Aug 2017 09:00:06 +0000 Christa Avampato 1994456 at http://www.wisebread.com 6 Ways Climate Change Could Affect Your Money http://www.wisebread.com/6-ways-climate-change-could-affect-your-money <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-ways-climate-change-could-affect-your-money" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-586087414.jpg" alt="Learning how climate change could affect your money" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>As our planet steadily warms and the climate changes, one thing is for certain &mdash; it is incredibly hard to predict what the long-term future holds.</p> <p>There is a ton of data that shows Earth's climate is warming, but the change is occurring so rapidly that the existing data doesn't necessarily provide scientists with a way to make 100 percent accurate predictions. Plus, we can hardly get weather predictions right for the next week, so imagine trying to make accurate predictions for decades into the future.</p> <p>All of that said, there are six predictions that we can generally make regarding the future of our planet and our money.</p> <h2>1. Water will cost more</h2> <p>Water is, hands down, our most precious resource on this planet. Scientists predict that potable water may become increasingly rare in the next 50 years &mdash; at least, based on our current climate models and methods for collecting and storing water. At least half the world's population relies on groundwater for personal consumption (with urban demand expected to grow by 55 percent by 2050, according to National Geographic), and groundwater is supplied by precipitation.</p> <p>Global warming is expected to increase downpours, so one might expect that our groundwater supply should be in good shape. However, that's not the case. Groundwater builds up slowly over time, through melting snowpack and steady precipitation. If climate forecast models are accurate, then it's possible that the next 100 years will see northern hemisphere snowfall amounts decline dramatically (between 10 percent and 30 percent, according to National Geographic). Increased precipitation, when it comes in the form of monsoon-like deluges that are too voluminous to be absorbed, simply causes flooding.</p> <p>In addition, warmer global temperatures will contribute to problems with water quality, according to both the Union of Concerned Scientists and Physicians for Social Responsibility. Rising seawater in low-lying coastal areas can contaminate freshwater reserves. In areas of drought, on the other hand, concentrations of freshwater contaminants are expected to increase, which can lead to potential health concerns for humans.</p> <p>Precipitation deluges can also cost municipalities millions if excess stormwater floods damage sewage treatment plants (as happened in Seattle in February 2017). This can lead to a costly backup &mdash; or in the case of the Seattle treatment plant, millions of gallons of raw sewage pouring into Puget Sound. All of this makes it extremely likely that the cost of potable water will get much higher in the next 50 years or so.</p> <h2>2. Energy will cost more</h2> <p>North America has enjoyed a boom in cheap oil and natural gas in recent years, thanks to fracking, a means of extracting oil and gas from rock shale using pressurized water. But as climate change causes freshwater supplies to dwindle and water costs to rise, expect to see either a falloff in fracking-related production of fossil fuels or a drop in demand.</p> <p>Other means of power generation may come under threat, too. Many of the country's rivers may actually see less water flow due to shifting precipitation patterns and accelerated evaporation rates. Less water flowing in our rivers will mean less water to power hydroelectric dams. Did you know that water is used to cool coal and nuclear power plants, too? Without access to that water, power brownouts are a possibility in many areas, especially during times of peak power usage.</p> <p>Fortunately, advancements in green technologies like solar and wind energy production (coupled with new efforts to manufacture batteries for home storage of electricity) promise possible relief. These technologies, along with microgrids &mdash; local energy grids that can disconnect from main power grids and run autonomously &mdash; can also help alleviate problems that arise from the aging of the already hopelessly outdated U.S. utilities infrastructure.</p> <h2>3. Food may cost a lot more</h2> <p>A warming climate is a mixed blessing when it comes to food production. Warmer weather and higher levels of carbon dioxide can mean happier crops and larger yields, but that's assuming that new diseases and pests don't also thrive on the warming conditions. Because the cost of food depends on so much more than crop yields, it's very difficult to say how food prices may rise in the future.</p> <p>According to National Geographic, some crops' yields will increase<a href="http://www.nationalgeographic.com/climate-change/how-to-live-with-it/crops.html">,</a> while others may see a significant drop. Among the predictions scientists are making:</p> <ul> <li>Corn yield may decline by as much as 20 percent in the Midwestern United States, and 16 percent in Brazil. And if the cost of corn and other basic cereals rises along with the cost of water, the cost of meat production will also rise.<br /> &nbsp;</li> <li>Potato farmers in northern Europe may expect an increase in production, whereas farms farther south will become increasingly drought-prone.<br /> &nbsp;</li> <li>West and East Africa may support more industrial agriculture, but China and India are expected to experience massive losses of arable land.</li> </ul> <p>As the climate continues warming, Americans may see a serious shortage of fresh fruits and vegetables, causing price hikes. California produces the vast majority of the fresh produce eaten in the United States, including citrus fruit, artichokes, broccoli, nuts, plums, and tomatoes. The state's vast farmlands are expected to suffer from more frequent droughts and heat waves as the climate continues warming.</p> <p>Seafood is also likely to become rarer and pricier as rising carbon dioxide levels cause oceans to acidify and harm or kill off species like salmon.</p> <h2>4. Flood prone real estate may lose value</h2> <p>Temperamental weather is one thing, but the warming atmosphere and oceans are also giving rise to more intense and numerous hurricanes and other ocean-centered storms.</p> <p>The tempests, combined with rising sea levels, are expected to devalue coastal property significantly over the next 50 to 100 years. According to the National Ocean Service, in 2010, 39 percent of the U.S. population lived in counties directly on the shoreline, with another 8 percent expected to join them by 2020. Consumers who own properties right up against the coast face not only physical dangers from rising sea levels, but also increasing costs, particularly for homeowners and flood insurance. You can expect to see premiums and deductibles rise in areas affected by climate change-related flooding.</p> <p>It has taken some time for the U.S. real estate world to react to the predictions about climate change, perhaps because North America hasn't experienced as much climate change-related damage as initially predicted (or perhaps because 60 percent of Americans don't believe that climate change will affect them personally, according to research from Yale University's Program on Climate Change Communication). However, changes are taking place. New York Times data shows home sales have dropped about 7.6 percent in high-risk flood areas of Miami-Dade County, even though home sales have increased 2.6 percent nationally.</p> <h2>5. Homeownership will cost more</h2> <p>Real estate agents like to say that there are three factors to consider when buying a home: location, location, location. Well, it's more true now than ever. While homeowners previously considered issues like neighborhood safety, the quality of the local school district, or local amenities, now homebuyers will also have to factor in issues like: Will my home be swept away in a freak flood? Are forest fires becoming a possibility in this area? The answers could point to significant dangers or at the very least, higher costs.</p> <p>Buying a home in an area that is negatively affected by climate change will affect more than your mortgage options and your insurance: You may also pay a fee just to live dangerously. Homes built in unincorporated fire-prone areas, for instance, may be charged an annual fee to help pay for firefighting efforts. This has already been proposed in Washington State.</p> <h2>6. Health care costs will continue to grow</h2> <p>Anyone who has been to Beijing or Bangkok knows how terrible air pollution can affect your health. From asthma to emphysema, a more polluted atmosphere (which is currently a huge contributor to our warming climate) can mean a host of new health issues.</p> <p>Warmer weather, combined with higher levels of carbon dioxide, can also cause plants to vigorously produce more pollen &mdash; meaning worsening symptoms for people with allergies.</p> <p>And a wetter, warmer climate encourages the spread of insects like mosquitoes, which carry deadly diseases. Speaking of insects, the bark beetle that is killing off vast swathes of forest in the Western United States and Canada is creating so much dead wood that it's contributing to larger, deadlier forest fires in the dry summer months. Those, in turn, further hurt asthmatics and people with other pulmonary issues.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F6-ways-climate-change-could-affect-your-money&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F6%2520Ways%2520Climate%2520Change%2520Could%2520Affect%2520Your%2520Money.jpg&amp;description=6%20Ways%20Climate%20Change%20Could%20Affect%20Your%20Money"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/6%20Ways%20Climate%20Change%20Could%20Affect%20Your%20Money.jpg" alt="6 Ways Climate Change Could Affect Your Money" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/andrea-karim">Andrea Karim</a> of <a href="http://www.wisebread.com/6-ways-climate-change-could-affect-your-money">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-industries-that-could-benefit-from-climate-change">8 Industries That Could Benefit From Climate Change</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/bottled-water-bottled-hype-part-1">Bottled Water, Bottled Hype Part 1</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/there-are-cheaper-ways-to-return-to-a-greener-earth">There are Cheaper Ways to Return to a Greener Earth</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/eight-natural-ways-to-make-water-more-flavorful">Eight Natural Ways to Make Water More Flavorful</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-reasons-an-hsa-is-actually-worth-having">10 Reasons an HSA Is Actually Worth Having</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Green Living agriculture climate change environment food costs global warming health care homeownership sea levels water Thu, 03 Aug 2017 09:00:05 +0000 Andrea Karim 1992116 at http://www.wisebread.com Here's How Boomers and Millennials Are Creating Winners on the Stock Market http://www.wisebread.com/heres-how-boomers-and-millennials-are-creating-winners-on-the-stock-market <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/heres-how-boomers-and-millennials-are-creating-winners-on-the-stock-market" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/mother_with_adult_daughter_in_park_together.jpg" alt="Mother With Adult Daughter In Park Together" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>It may not seem like millennials and baby boomers have a lot in common, aside from the fact that they make up a huge chunk of the U.S. population. But the two generations do share some similar traits when it comes to spending and investing. This is already having a significant impact on the economy and the stock market, and will continue to do so.</p> <p>Here are some key ways that baby boomers and millennials are impacting business and the markets.</p> <h2>Health care will be huge</h2> <p>There's a lot of noise related to the Affordable Care Act and a possible replacement. How things will shake out on Capitol Hill is anyone's guess, but there's no doubt that Americans will be spending more on health care. Baby boomers make up an increasing percentage of the U.S. population, and will require more medical attention as they age. This means big profits for pharmaceutical firms, but also biotech companies, hospitals, and manufacturers of medical equipment. The S&amp;P 500 Health Care Index has seen annualized returns of more than 16 percent over the last five years, and is up nearly 12 percent in 2017. Expect the upward trend to continue.</p> <h2>Health consciousness is also big</h2> <p>Millennials are aware of the obesity problem in America, and many of them are making lifestyle choices to counteract that. We've seen a push for more natural and organic food items, and a desire for less sugar and fat. This also means a continued expansion of fast-casual restaurants that offer healthier options, perhaps at the expense of traditional fast food chains. Baby boomers will help fuel this push to health as well simply by following doctor's orders to eat healthy as they age.</p> <h2>Investing costs will go down</h2> <p>Boomers have no interest in seeing their retirement savings cut down by high expense ratios and commissions, and millennials are becoming more savvy about the impact these costs have on their portfolios. These two demographics have led the charge against fees, and we've seen some brokerages respond. In February, Charles Schwab and Fidelity cut their online trade commissions to a mere $4.95, and many brokerage firms have expanded their offerings of commission-free exchange-traded funds (ETFs).</p> <p>Meanwhile, investing in low-cost index funds has ballooned; nearly half of all assets placed in mutual funds and ETFs are indexed rather than in actively-managed accounts, according to Morningstar.</p> <h2>Investing in individual stocks will decline</h2> <p>Aging baby boomers can be expected to withdraw their investments or at least shift their portfolios to more conservative investments like bonds and cash. Meanwhile, millennials are wary of the markets in general after living through the stock market declines of the early 2000s and 2008. Millennials have also learned that trying to beat the market by investing in individual stocks is generally a fool's game. This shying away from individual stocks could impact the overall returns in the stock market over time.</p> <h2>Popular brands aren't a sure thing</h2> <p>There has long been a common thought among investors that big, popular brands will always be surefire investments. Investors have long banked on the notion of brand loyalty as a driver of investment returns. But there have been several recent reports that millennials are not as brand-loyal as their predecessor generations. Millennials will go for value and quality, and aren't going to stick with a single brand out of stubbornness. This may have implications for stocks that have performed well over the years in part due to brand recognition.</p> <h2>Brick-and-mortar retail will go south</h2> <p>We're already seeing retail chains struggling, with H.G. Gregg, Gymboree, Rue 21, and several other brick-and-mortar outlets declaring bankruptcy in recent months. Meanwhile, online retailing giant Amazon just reported a 23 percent increase in sales, to $35.7 billion. Millennials don't mind shopping online, and baby boomers are less likely to go out on long shopping trips as they get older.</p> <h2>Experiences over objects</h2> <p>Millennials don't really care about owning things. Instead, they get satisfaction from experiences like fitness classes, travel, or eating well. To the extent that they need items such as music or movies, they prefer to obtain them through streaming services such as Netflix (one of the hottest tech stocks in America) or Spotify. Meanwhile, baby boomers are getting older and aren't in the habit of acquiring more &quot;stuff,&quot; either.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fheres-how-boomers-and-millennials-are-creating-winners-on-the-stock-market&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHeres%2520How%2520Boomers%2520and%2520Millennials%2520Are%2520Creating%2520Winners%2520on%2520the%2520Stock%2520Market.jpg&amp;description=Heres%20How%20Boomers%20and%20Millennials%20Are%20Creating%20Winners%20on%20the%20Stock%20Market"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/Heres%20How%20Boomers%20and%20Millennials%20Are%20Creating%20Winners%20on%20the%20Stock%20Market.jpg" alt="Here's How Boomers and Millennials Are Creating Winners on the Stock Market" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/tim-lemke">Tim Lemke</a> of <a href="http://www.wisebread.com/heres-how-boomers-and-millennials-are-creating-winners-on-the-stock-market">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-reasons-millennials-should-stop-being-afraid-of-the-stock-market">7 Reasons Millennials Should Stop Being Afraid of the Stock Market</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/are-you-making-the-biggest-investment-risk-of-all">Are You Making the Biggest Investment Risk of All?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/with-micro-investing-your-smartphone-pays-you">With Micro-Investing, Your Smartphone Pays YOU</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-things-everyone-should-know-about-the-commodities-markets">8 Things Everyone Should Know About the Commodities Markets</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/15-unexpected-expenses-of-a-new-baby">15 Unexpected Expenses of a New Baby</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment baby boomers brand loyalty eating well Food Health health care millennials retail stock market Mon, 24 Jul 2017 08:00:10 +0000 Tim Lemke 1986883 at http://www.wisebread.com 7 Ways Retirement Planning Changes When You're Single http://www.wisebread.com/7-ways-retirement-planning-changes-when-youre-single <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-ways-retirement-planning-changes-when-youre-single" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/senior_woman_relaxing.jpg" alt="Senior woman relaxing" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>It can sometimes feel like everything is created with couples in mind &mdash; including retirement planning. When every article, tip, and suggestion for retirement starts with the assumption that you are married, you might be forgiven for assuming that retiring solo is just a matter of cutting retirement planning advice in half.</p> <p>But there are specific challenges and concerns (not to mention benefits!) that single retirees need to prepare for before they hang up their careers. Here are seven ways that preparing for retirement is different for singles.</p> <h2>1. You need to have adequate disability insurance</h2> <p>Relying on no one but yourself can feel pretty liberating. Not only do you answer to no one but yourself, but you also get to enjoy the fruits of your own labor without having to compromise.</p> <p>The downside to this, however, is figuring how you will protect yourself in case your income runs dry. While anyone who relies on income from their job should carry adequate disability insurance, this is even more important for single workers who may not have another safety net to catch them if a disability makes it impossible to work. You need to protect yourself, your income, and your assets from the possibility you may be unable to work, even before you start the nitty-gritty of retirement planning.</p> <p>Even if you have disability insurance through work, that may not be adequate to protect you from a loss of income. Make sure you know exactly how much your work insurance covers and for how long, so that you are not left without an income if it's not enough. Also, don't assume that you are immune to potential disabilities just because the most strenuous thing you do at work is operate the copy machine. Illness is behind the majority of long-term absences from work &mdash; and anyone can get sick at any time.</p> <h2>2. Prepare for your health care needs</h2> <p>Health care costs are a major concern for all retirees, since this is one aspect of your retirement budget that you may not have control over. According to a 2016 Fidelity study, a 65-year-old couple retiring in 2016 would need $260,000 for health care to cover their medical and health care needs for the rest of their lives.</p> <p>That dollar figure is frightening no matter your marital status, and it's important that single people recognize that their costs may be higher than just half of a couple's health care costs. That's because many married couples can help each other to remain independent in ways that single retirees would need to pay for. For instance, you may need to pay for someone to help you at home or for entry into a retirement community sooner than a married couple would need those things.</p> <p>While <a href="http://www.wisebread.com/is-long-term-care-insurance-worth-it" target="_blank">long-term care insurance</a> has often been touted as a method of mitigating these expenses for both married and single retirees, the cost of this kind of insurance has become prohibitive. To prepare for the possibility of bad health in retirement, singles should also explore creative solutions to long-term health issues. For instance, taking in a rent-free roommate who helps with daily tasks is not only money-saving, but also offers social support. Planning ahead for potential solutions to health and mobility issues can provide you with some imaginative solutions that money can't buy.</p> <h2>3. Assign a power of attorney</h2> <p>It's easy to assume that you can skip the whole issue of legal planning if you are single and childless, but that's not necessarily true. For instance, do you know who will take care of your health care or financial decisions if you should become incapacitated? You need to assign a power of attorney to make sure that your wishes are followed if you cannot make your own decisions.</p> <p>Your power of attorney also needs to know where to find your important papers and should be kept apprised of any changes in your life or directives. This is the person who will pay your bills and handle your advanced directive if you fall ill. You can either pick someone in your life whom you trust, or hire a professional whom you trust to fill that role.</p> <h2>4. Invest in tax-deferred retirement vehicles during your career</h2> <p>Single workers miss out on a number of tax breaks that are offered to married couples. According to Jane Hodges writing for <em>The Wall Street Journal</em>, &quot;Without child tax credits, a spouse exemption, and no one with whom to realize the benefits of filing jointly, singles can take a pretty big tax punch during peak earning years.&quot;</p> <p>For this reason, single workers have a particular need to invest in tax-advantaged retirement vehicles, such as 401(k) and traditional IRA accounts. These vehicles allow you to make pretax contributions, which lowers your taxable income while also helping you prepare financially for retirement.</p> <h2>5. Consider rolling over into a Roth IRA before age 70&frac12;</h2> <p>Of course, Uncle Sam will still want his cut of the income you put in tax-deferred retirement accounts, which can cause a nasty tax surprise for singles post-retirement. That's because withdrawals from tax-deferred retirement accounts are taxed as ordinary income, and single retirees still do not have access to the tax breaks offered to married couples.</p> <p>This can become a serious problem for some single retirees as of age 70&frac12; because of the required minimum distributions on tax-deferred accounts. Traditional IRAs and 401(k)s require that retirees begin withdrawing a minimum distribution (based on a percentage of total assets) at age 70&frac12;, which means you might be facing a surprisingly high tax bracket upon reaching age 70&frac12;. You may also be forced to take more money from your accounts than you want or need because of the required minimum distribution.</p> <p>To protect yourself from this potentially painful tax bite, consider rolling over a portion of your assets from tax-deferred funds to a Roth IRA account before age 70&frac12;. Since Roth accounts are funded with after-tax dollars, you will have to pay ordinary income tax on your rollover. However, this will allow you to decide when you will pay those taxes and give you more freedom to keep your money invested if you don't need it.</p> <h2>6. Hold off on Social Security for as long as you can</h2> <p>Options for optimizing Social Security benefits are much simpler for singles. Basically, the only way to get a higher monthly benefit if you are single is to wait. The longer you can wait to receive your benefits between age 62 (the earliest you can take benefits) and 70 (when the benefits stop growing), the more money you will see with every monthly check. Even if you cannot wait until age 70, or your full retirement age (currently age 66), know that each month you delay taking your Social Security retirement benefits means a little more money in your checks.</p> <p>It's also important to remember that the federal government does not necessarily define single the same way you do. If you are divorced but were married for at least 10 years, then you are eligible for spousal benefits based on your ex's income record. However, you will collect your spousal benefits concurrently with your retirement benefits, so you will only see an increased benefit if your ex-spouse made a lot more money than you did.</p> <h2>7. Embrace the opportunities</h2> <p>While the IRS and Social Security Administration may both make marriage look like the better option &mdash; at least financially &mdash; it's important for singles to remember how many more opportunities they have available to them than do married couples. That's because a footloose and fancy-free retiree has far fewer obstacles to retirement than does a married couple.</p> <p>For instance, retiring abroad can be a very economical (not to mention fun) choice, and it is much easier for a single retiree to pull up roots than it is for a couple. Similarly, traveling in retirement can be much cheaper for one, since you do not have to compromise on where you are willing to save money.</p> <p>Single retirees can also explore alternative living options, like living with several friends &mdash; there's an excellent reason why all the Golden Girls were single, after all &mdash; or taking in a younger boarder or roommate, or even moving to a cheaper state. Making these decisions solo means you can find the living situation or opportunity that best fits your needs, wants, and temperament.</p> <!--<h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><script async defer src="//assets.pinterest.com/js/pinit.js"></script> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/7%20Ways%20Retirement%20Planning%20Changes%20When%20Youre%20Single.jpg" alt="7 Ways Retirement Planning Changes When You're Single" width="250" height="374" /></p> </div>--><!--<h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><script async defer src="//assets.pinterest.com/js/pinit.js"></script> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/7%20Ways%20Retirement%20Planning%20Changes%20When%20Youre%20Single.jpg" alt="7 Ways Retirement Planning Changes When You're Single" width="250" height="374" /></p> </div>--><br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/emily-guy-birken">Emily Guy Birken</a> of <a href="http://www.wisebread.com/7-ways-retirement-planning-changes-when-youre-single">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-face-these-7-scary-facts-about-retirement-saving">How to Face These 7 Scary Facts About Retirement Saving</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/3-common-retirement-regrets-you-can-avoid">3 Common Retirement Regrets You Can Avoid</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-revive-an-old-retirement-fund">How to Revive an Old Retirement Fund</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-age-milestones-that-impact-your-retirement">6 Age Milestones That Impact Your Retirement</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-retirement-planning-steps-late-starters-must-make">7 Retirement Planning Steps Late Starters Must Make</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Retirement 401(k) advice disability insurance health care IRA loss of income not married power of attorney retirement planning singles Fri, 14 Jul 2017 09:01:05 +0000 Emily Guy Birken 1982441 at http://www.wisebread.com 10 Reasons an HSA Is Actually Worth Having http://www.wisebread.com/10-reasons-an-hsa-is-actually-worth-having <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/10-reasons-an-hsa-is-actually-worth-having" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/male_medicine_doctor_wearing_blue_tie_holding_piggybank.jpg" alt="Male medicine doctor wearing blue tie holding piggy bank" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>I put off signing up for an HSA for years because it was confusing and seemed to have a lot of rules and restrictions. You need to have an HDHP (high deductible health plan) in order to get an HSA. HSA funds can only be spent on qualified medical expenses &mdash; or else you can be hit with a 20 percent penalty and have to pay income tax on the withdrawal. I was hesitant to contribute funds into an account when I was worried it would be complicated to get the money back out.</p> <p>But participating in an HSA turned out to be a lot easier than I expected, and it has saved me a lot of money. If you do not anticipate having a lot of health care expenses, a high deductible health plan plus an HSA may be a good move. (See also: <a href="http://www.wisebread.com/how-an-hsa-saves-you-money?ref=seealso" target="_blank">How an HSA Saves You Money</a>)</p> <h2>1. Convenient access to HSA funds</h2> <p>You can conveniently access your HSA funds using a credit card tied to the HSA account at the doctor's office or pharmacy. You can also pay medical expenses with a check or credit card, and then withdraw funds from your HSA account to put back into your checking account.</p> <h2>2. Use HSA funds for a variety of medical expenses</h2> <p>HSA spending is not limited to only doctor and hospital bills &mdash; you can also <a href="http://www.wisebread.com/11-surprising-things-your-hsa-will-cover" target="_blank">use HSA funds</a> for medication, eye care, dental care, and other health-related expenses including bandages and prescription sunglasses. The IRS offers a complete list of <a href="https://www.irs.gov/pub/irs-pdf/p502.pdf" target="_blank">qualified medical expenses</a>.</p> <h2>3. HSAs offer plenty of tax advantages</h2> <p>You'll contribute pretax dollars to an HSA from every paycheck, without paying income tax on those contributions. This means you can save around 25 to 30 percent on health care expenses, depending on your tax rate. In addition, you can earn interest on the funds in your HSA account. With some HSA providers, you can even invest your HSA funds for more potential growth. Gains on HSA funds are tax-free.</p> <p>For qualified medical expenses, you can also withdraw funds from your HSA tax-free.</p> <h2>4. HSA funds roll over from one year to the next</h2> <p>One of my concerns with putting money into an HSA was the fear that it was a &quot;use it or lose it&quot; proposition like some flexible spending accounts I have previously used for health expenses. But funds in an HSA roll over from one year to the next, so you never lose your money if you don't spend it.</p> <h2>5. An HSA builds funds for future medical costs</h2> <p>An HSA is not only a way to pay for current medical expenses, it is also an ideal vehicle to build savings for future medical expenses. You can deposit money on a pretax basis, enjoy growth on invested HSA funds without paying taxes, and then withdraw funds years later when medical expenses arise with no tax obligation. No other investment vehicle provides this combination of benefits to grow savings for medical costs.</p> <h2>6. You can use your HSA as an IRA at age 65</h2> <p>When you reach age 65, you can continue to draw funds for qualified medical expenses tax-free. Or, you can use your HSA funds for any purpose you wish, without penalty (but you will pay income taxes if it's for non-health spending). An HSA effectively functions as an individual retirement account (IRA) when you reach 65, with the added benefit of tax-free dollars for medical expenses.</p> <h2>7. Your HSA is portable</h2> <p>When you move from one employer to another, or even opt to pursue freelance work, you get to keep your HSA and all of your funds.</p> <h2>8. Free HSA funding</h2> <p>Some employers contribute funds to employees' HSA accounts as a benefit. If you don't have an HSA, you might be missing out on free money!</p> <h2>9. You don't need an employer to have a HSA</h2> <p>Although the easiest way to take advantage of an HSA is to simply sign up for a program offered by your employer, you can open your own HSA if you are self-employed. You will need to find your own HSA provider such as a bank, credit union, insurance company, or investment broker. Look for an HSA provider with low fees, that provides access to HSA funds via a credit card, and that provides investment options for HSA funds.</p> <h2>10. Significant tax savings</h2> <p>The maximum annual HSA contribution amount is $3,350 for individuals, or $6,750 for families. Let's say your federal plus state income tax rate is 25 percent. Since contributions are tax-free, if you contribute the maximum to your HSA, you would save $837.50 for an individual or $1687.50 for a family on taxes on current or future qualified medical expenses.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F10-reasons-an-hsa-is-actually-worth-having&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F10%2520Reasons%2520an%2520HSA%2520Is%2520Actually%2520Worth%2520Having.jpg&amp;description=10%20Reasons%20an%20HSA%20Is%20Actually%20Worth%20Having"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/10%20Reasons%20an%20HSA%20Is%20Actually%20Worth%20Having.jpg" alt="10 Reasons an HSA Is Actually Worth Having" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dr-penny-pincher">Dr Penny Pincher</a> of <a href="http://www.wisebread.com/10-reasons-an-hsa-is-actually-worth-having">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. 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