01/30/17

These Are The Top 10 States For Retirement

By Alana Stramowski, January 3, 2017, Homehealthcarenews.com

The majority of older Americans wish to age in place, but aside from living near family and friends, they also are looking at other factors to choose where they want to live as they age.

The best states for retirement were found based on life expectancy, tax friendliness ranking, violent crime rate per 100,000, the cost of living index and health care costs, according to a recent study from MoneySavingPro.com.

Taking the No. 1 spot on the list is Idaho. The state has a life expectancy of 79.5 years, a tax friendliness ranking of 28, violent crimes per 100,000 is 212.2, a health care cost per capita of $5,658 and a cost of living index rating of 88.2.

Following Idaho is Utah in second place. Utah has a life expectancy of 80.2, a tax friendliness ranking of 27, violent crimes is 215.6 of 100,000, a cost of living index rating 92.4 and a health care cost per capita of $5,031, which is the lowest on the top 10 list.

The states with the best tax friendliness rankings are Alaska in first place and Colorado in second place, the study found.

There are also a few warmer-weather climates on the top 10 list, which many seniors strive for. Those states include Hawaii, Arizona, Kentucky and Georgia.

These are the top 10 best states for retirement:

1. Idaho

2. Utah

3. North Dakota

4. Hawaii

5. Arizona

6. Colorado

7. Kentucky

8. Georgia

9. Iowa

10. Kansas

On the flip side, the 10 worst states for retirement were revealed, according to the study. The worst is West Virginia. The state has a life expectancy of 75.4, a tax friendliness ranking of 46, 302 violent crimes per 100,000, a health care cost per capita of $7,667 and a cost of living index rating of 103.7.

The worst 10 states for retirement are:

50. West Virginia

49. Tennessee

48. South Carolina

47. Alaska

46. Nevada

45. New Jersey

44. Massachusetts

43. Texas

42. New York

41. Wisconsin

To Your Successful Retirement!

Michael Ginsberg, JD, CFP®

01/23/17

The 10 Best Places in the World to Retire in 2017

By Richard Eisenberg, January 2, 2017, NextAvenue.com

There’s a new best country in the world to retire, according to the experts at International Living (IL), an authority on global retirement and relocation opportunities. In its Annual Global Retirement Index, Mexico — one of the most popular countries among U.S. expats — has edged out last year’s No. 1, Panama.

But truth be told, Mexico (which was ranked No. 3 in 2016), Panama and Ecuador are within a hair of each other in the new International Living rankings. “There’s just a tenth of a percentage point difference in their total rankings,” said Dan Prescher, an International Living senior editor who lives with is wife Suzan Haskins in Cotacachi, Ecuador.

Retiring Abroad Is Growing in Popularity

If you’re intrigued because you’re considering joining the expat community, you’re in good company.

According to a recent AP story by Maria Zamudio, the number of Americans retiring outside the U.S. grew 17 percent between 2010 and 2015. Currently, about 400,000 American retirees live abroad. And, Zamudio noted, that number is “expected to increase over the next 10 years as more baby boomers retire.”

The big news in the past year regarding retiring around the world was the strength of the dollar. It has made living in some countries incredibly cost effective.

— Dan Prescher, International Living

Where the International Living Top 10 Countries Are

Six of IL’s Top 10 places in this year’s ranking are nearby, in Latin America — either in North America (No. 1 Mexico), Central America (No. 2 Panama, No. 4 Costa Rica and No. 8 Nicaragua) or South America (No. 3 Ecuador and No. 5 Colombia). Just three are in Europe (No. 7 Spain, No. 9 Portugal and a new addition to the winners’ list, No. 10 Malta); just one is in Asia (No. 6 Malaysia). Thailand, No. 7 in last year’s rankings, fell out of the Top 10. (See the slideshow below for specifics about each of the 10 countries atop International Living’s 2017 list.)

Incidentally, communities in Mexico, Colombia, Spain, Nicaragua and Portugal are also in the just-released Top 10 Best Places to Live Overseas in 2017 from Live and Invest Overseas.

Most of International Living Top 10 countries this year “have been heavyweight contenders in our Index for some time,” said Eoin Bassett, IL’s editorial director, who is based in No. 21 Ireland. This year, IL turned its sights on 24 countries, adding Bolivia to its list (No. 18, by the way).

Where the Buys Are

“The big news for U.S. citizens in the past year regarding retiring around the world was the strength of the dollar. It has made living in some countries, especially Latin America, incredibly cost effective,” said Prescher. “The exchange rate was outrageous in our favor. The Mexican peso today is 20 to 1 against the U.S. dollar, which has made Mexico an incredible deal.”

Expats in Mexico told IL that they live well there on as little as $1,200 a month. “My rent is $575 a month for a two-bedroom apartment with a great modern bathroom and nice kitchen,” San Francisco native turned Puerto Vallarta resident Jack Bramy told International Living.

How International Living Ranks Countries for Retirement

To compile its 2017 ranking, International Living’s editors, correspondents, contributors and contacts around the world crunched data and personal insights for 10 categories (from Cost of Living to Visas & Residence to Fitting In to Climate).

Cost of living is a major retirement concern for Americans, according to a recent Transamerica Center for Retirement Studies survey of U.S. workers. Respondents told Transamerica that an affordable cost of living was their most important criteria for where to live in retirement.

So what else made these 10 countries so great this year?

Mexico was best among International Living’s Top 10 for Entertainment & Amenities, but also had impressive scores in every other category.

I asked Prescher why Mexico scored so well for entertainment and amenities. Turns out, he and his wife were visiting the picturesque town of Ajijic, in western Mexico, at the time. “Oh man, there’s nothing like good quality Mexican food and music,” he said. “We’re just 50 minutes from Guadalajara, the second largest city in Mexico and a world-class city like Miami. If you can’t find it or do it in Guadalajara, it’s not worth finding or doing.”

What Made the Winners Win

Runner-up Panama received IL’s best scores for Benefits & Discounts and Visas & Residence. “Panama changed its visa situation a little and it’s now incredibly easy to get a residency visa,” said Prescher.

The country is also well known for its Pensionado program of discounts for retirees there who receive at least $1,000 a month in income. The deals, which Prescher says are “some of the best in Central America and South America,” include 50 percent off entertainment; 30 percent off bus, boat and train fares; 25 percent off airline tickets and 20 percent off doctor’s bills. Prescher also calls health care in Panama City “world-class.”

Ecuador had top scores for Buying and Renting (tied with Nicaragua) and for Climate. “Ecuador has always been one of the most affordable places for real estate in Central America and the strong dollar did nothing but improve that,” said Prescher. And don’t get the ex-Nebraskan started on the unbeatable weather in his now-home country; living near the Equator, he pays nothing for heating or air conditioning.

Costa Rica led the Top 10 for Healthy Lifestyle (tied with Nicaragua); Malaysia for both Fitting In (“it’s a nexus for world cultures,” said Prescher) and Health Care (it’s a popular medical tourism destination); Spain for Infrastructure (great mass transit and Internet) and Nicaragua for Buying & Renting, Cost of Living and Healthy Lifestyle.

Bassett calls Nicaragua “the lowest-cost retirement destination in Central America,” adding that “every year it offers more and more by way of amenities and opportunities.”

Along with Spain and Malta, Bassett noted, Portugal “is an even more appealing destination heading into 2017 with the strength of the dollar against the Euro.”

Advice for Retiring Abroad

Even the International Living folks don’t think you should move to a foreign country for retirement just because it scores well in their (or anyone else’s) ranking, though. Before relocating, said Prescher, “profile yourself ruthlessly about what you really want in a place. Find out what you can and can’t live without.” Then, be certain any locale you’re considering is a match.

And before making a permanent move to a particular place, Prescher added, “try it out for as long as you can. See what it’s like to be there not just on vacation, but long enough to set up Internet access and to open a bank account.”

I’d add one giant caveat about the International Living rankings: The political and economic climate in the U.S. in 2017 could change considerably, which could, in turn, affect the lure of some countries as retirement havens.

As Prescher said presciently: “The presidential situation has changed completely, so everyone will be watching. What we will do with our relationship with Mexico and European countries is anybody’s guess.”

To Your Successful Retirement!

Michael Ginsberg, JD, CFP®

01/17/17

How to Save for Retirement in Your 40s

By Rodney Brooks, Jan 8, 2017, THE STREET.COM

Many people wait until later in life to start saving for retirement. It gets complicated with kids and aging parents, but Gen X can find a winning strategy.

Beginning your retirement savings in your 20s and 30s is a great strategy, recommended by many financial planners. But many people wait until their 40s – after they have settled into family life with marriage, automobiles, kids and first homes. That’s just the reality. But it’s still not too late to begin savings habits that will pay off handsomely once you reach retirement age.

“As you get into your 40s, chances are you are making a little more money, starting to hit stride in your career, and maybe you have kids,” says Tom Mingone, founder and managing partner of Capital Management Group. “You may have discretionary income.”

The most effective method to save is out of your paycheck, through your 401(k), he says. “The best way to save is a direct deduction out of your check,” Mingone says. “Extra money is like extra closet space. There is no such thing. You use what you have. Pay yourself first. Have money coming out on the 1st or 15th (of the month). You will get used to living on less.”

In their 40s is when people have a job history and higher income, says Laurie Blackburn, first vice president, Investments at the Speck – Caudron Investment Group of Wells Fargo Advisors in Alexandria, Va. ”It is time to start maxing out your IRA and 401(k) contributions, if they haven’t,” she says. “If you start younger, you can increase that amount every year.

A lot of 401(k)s have a built-in escalator – 3% (contribution rate) goes to 4%. Every year, your contribution increases 1 percent, till you are maxed out.” By the time you are in your 40s, you should be maxed out, she recommends. Next up, you should look at your asset allocation and risk tolerance, she says.

Bob Stammers, director of investor engagement for the CFA Institute, says that even though their 40s are top earning years for many, it is also the time when people have many claims on their income, especially things like their kids’ college tuition. For that reason he says he would like to see the retirement system go from annual dollar limits to lifetime limits.

“At different times of people’s lives they have significant income they can contribute to retirement plans,” he says. “For most people, it’s in their 40s. People need to think about maintaining their lifestyles and put away any windfall or increase in salary.” Of course, many people in their 40s start to consume more, because they’re earning more. “Those that don’t get disciplined about savings habits and tracking expenses don’t have money they can put toward retirement,” Stammers adds.

Mingone says no matter which stage you are in life, you also need to think about taxes.”You always want to be aware of your tax bite,” he says. “We think of saving for retirement in three bucket – taxes now, taxes later and taxes never,” he says. “Taxes now are mutual funds. You pay taxes now on gains. Taxes later are things like 401(k) and IRAs. You get a deduction, but you don’t pay taxes now. You pay taxes later. Taxes never are things like Roth 401(k), Roth IRA and life insurance. If you structure it property, all you income will be tax free.” He says it’s also important to be actively manage your investments at the end of the year: Harvest your losses and minimize earnings. “You don’t want to be taxed heavily,” he adds.

To Your Successful Retirement!

Michael Ginsberg, JD, CFP®

01/10/17

18 Questions to Ask Yourself Before You Retire

By Dave Hughes, January 5, 2017, US News & World Report

After you retire, your daily life will change in more ways than you probably imagine. Developing a clear picture of how you want to live your life after you retire will help you make better plans and adapt more easily to the changes retirement brings. You need to decide what your retirement will be like and come up with specific things to look forward to. If you’re married or partnered, there are many conversations to have together. You shouldn’t assume that your spouse wants the same things you do. Give careful thought to these questions as you approach retirement:

1. What does being retired mean to you? Obviously, retirement typically means not going to work. Beyond that, you may look at the next chapter of your life as a new adventure, or you may see it as a chance to relax. While it’s fine to decompress for a few weeks or months after you retire, sooner or later you’ll want to get on with your new life.

2. What do you want to add to your life and eliminate from your life? Aside from no longer working, you may want to decrease or eliminate your involvement in professional associations, boards or other obligations. You may wish to cancel housekeeping or landscaping services and take on those tasks yourself or vice versa. You are now free to engage in only those things that truly bring value and enjoyment to your life.

3. What are your travel plans? This is a multi-faceted question that includes how much time you hope to spend traveling, where you want to go and how you want to get there. Your travel plans may range from exploring the world to simply visiting friends and relatives. You may decide to become a snowbird.

4. What will you be passionate about? Once you no longer have to focus on your career or raising children, your interests and priorities may change dramatically. Think about what will excite you and give you things to look forward to. If you haven’t been focused on anything other than your career and your family, you will need to find something new.

5. Is it important to be close to your family? If you live away from your family, think about how often you will want to visit them and how often you hope they will visit you. Keep in mind that although you will have a lot more time on your hands, other family members may still be busy with their careers. If you have grandchildren, consider how much you’re willing to serve as a babysitter.

6. Do you want to remain in the community where you live now or move somewhere else? Many people dream of moving to a warmer climate or a favorite vacation spot near a lake or in the mountains. But it’s important to consider whether your new location has the businesses, services and recreational and cultural amenities you will want for your day-to-day life. You’ll also be moving away from many of the people who are most important to you.

7. How do you feel about downsizing? In addition to considering the pros and cons of moving to a smaller house, think about how many possessions you are willing to get rid of and what you definitely want to keep. You and your spouse may have very different opinions on this issue.

8. How structured or spontaneous do you want your life to be? While you might eagerly anticipate freedom from your tightly-structured work day and look forward to waking up each morning without an alarm clock, you will probably find that living a totally unstructured life isn’t as enjoyable as it sounds. Some structure helps ensure that you will do the things you want to do and keep your life on track.

9. Do you plan to start a business after you retire? This doesn’t have to be a business in the traditional sense. There are many activities you could pursue that produce income, such as selling crafts or artwork, consulting services or becoming a paid writer, musician or public speaker.

10. What activities do you plan to engage in? Hopefully, you are looking forward to retirement as a time when you can do many of the things you didn’t have time for while you were working. You’ll want to coordinate with your spouse to find the right combination of solo activities, things you will do with your spouse and group activities.

11. What do you want your social life to look like? After you leave work, socialization doesn’t happen as easily as it did before. You will have to take a more proactive role in keeping in touch with your friends. It’s a good idea to choose some activities that will expose you to new people. Staying socially engaged is extremely important after you retire in order to avoid loneliness.

12. Which people in your life are most important to you? Think about how you will stay engaged with friends after you retire, especially those who continue to work. If your circle of friends consists mostly of work colleagues, you may be surprised by how quickly those relationships fade. Similarly, if you move after you retire, you will have less contact with your current friends.

13. What new things do you want to learn? Many seniors stay mentally engaged by continuing to learn throughout retirement. The best part is that you can focus on whatever you are interested in and not worry about exams and grades.

14. What’s on your bucket list? Having a list of things you want to do and places you want to visit is great, but in order to actually accomplish them you will need to set some dates and make some concrete plans.

15. What will provide a sense of purpose for you after you retire? If you relied heavily on your career accomplishments for purpose and fulfillment, you may experience a feeling of emptiness after you retire until you find a new source of satisfaction.

16. Do you want to be of service to others in some way, such as volunteering or mentoring? If you envision retirement as being entirely about relaxation, leisure and fun, you may discover that you still value the reward and the sense of purpose that comes from helping others. Mentoring or teaching is an excellent way to share your knowledge with others.

17. Do you want to spend all or most of your money on yourself or leave an inheritance to your beneficiaries? There’s no wrong answer to this question, but it’s important to be on the same page as your spouse. You may be surprised to learn that your heirs hope that you’ll spend your money on yourself.

18. How do you want to be remembered? After you leave your working career, you will probably realize that your professional accomplishments such as awards, promotions and an impressive job title don’t matter as much. You may find that the impact you have on other people and what you contribute to the world matters a lot more.

Thoughtfully answering these questions will help you to envision a future filled with exciting possibilities and give you a clearer picture of what you want for the rest of your life.

To Your Successful Retirement!

Michael Ginsberg, JD, CFP®