MONEY real estate

Retiring? Stay or Go, You’ve Got Moves to Make

Housing accounts for the biggest part of your costs in retirement. So spend wisely.

Once you start looking at retirement over a horizon of five years or so, it’s time to start thinking about how you’ll manage your biggest single asset: your home.Whether you intend to stay put or move to that lake cottage, keeping real estate costs under control is key to your security.

Those costs may be larger than you think. On average, housing makes up one-third of spending for those ages 54 to 74—the largest single category. More than half of Americans ages 55 to 64 are carrying mortgages, higher than in previous generations. “Paying mortgage debt into retirement reduces your lifetime wealth and limits your spending,” says Pam Villarreal, a senior fellow at the National Center for Policy Analysis.

Staying in your house, with your mortgage paid, doesn’t free you from making decisions. Few pre-­retirees think about adapting their homes for retirement living. “It’s hard for active people in their fifties or sixties to think about what they might want 15 years from now,” says Bonnie Sewell, a financial adviser in Leesburg, Va.  Should you end up not being able to get around easily, though, you’ll have fewer choices and less ability to make them. So take action now:

Moving? Don’t take your mortgage with you. Nearly 30% of boomers plan to relocate when they retire, according to a new AARP survey. Many of them are seeking to cut costs by moving to a lower-tax state. Carry a mortgage, however, and this strategy may not have a big impact on your cash flow, as a recent analysis by Villarreal found. Mortgage debt can easily erode the benefits of lower taxes. Run your own numbers at whynotmove.org.

Cash flow

Sure, if you’ve got plenty of cash, mortgage payments may not seem like an issue. But there’s security, and flexibility, in not carrying debt. “Many of my clients see having no mortgage payments as a way of freeing up cash for future health care costs,” says Philadelphia financial planner Cathy Seeber.

If you plan to stay, renovate now. By your late fifties, your kids are probably out of the house, and the tuition bills are behind you—or nearly so. Time to renovate? Use this opportunity to make a few additional changes that will let you stay in your home for the next couple of decades. “The last thing you want to do in your seventies or eighties is manage a major rehab in an emergency,” says Sewell.

If you have a house with stairs, make sure you can live on one floor if necessary, says Mary Jo Peterson, a design consultant in Brookfield, Conn.  That may mean expanding a powder room to a full bath. You can also add design touches that appeal to people of all ages—a sloped ­entrance-walk instead of steps is more convenient for moms with strollers and college students dragging suitcases, not just the elderly. Find more ideas at aarp.org/­livable-communities, and your family home can last for generations.

 

MONEY working in retirement

Don’t Buy Into the Retirement Gloom

Senior in the workplace
Thomas Barwick—Getty Images

In the emerging Unretirement movement, you are your best investment.

This story was originally published at Next Avenue.

Gray wave. Age wave. Geezer tsunami. (Pick your favorite — or most hated — euphemism.) Catchphrases like these capture the realization that we’re living longer and that older Americans make up a growing share of the population. As economist Laurence Kotlikoff and columnist Scott Burns say in The Coming Generational Storm: “The aging of America isn’t a temporary event. We are well into a change that is permanent, irreversible, and very long term.”

Living longer should be a trend worth celebrating. But many people believe that America’s boomers can’t afford retirement, let alone a decent retirement. They fear that aging boomers are inevitably hurtling toward a lower standard of living.

And here’s their evidence: We’ve just been through the worst downturn since the 1930s, decimating jobs and pensions. Retirement savings are slim. Surveys show that boomers aren’t spending much time planning for retirement. The prediction that the swelling tab for Social Security and other old-age entitlements will push the U.S. government and economy into a Greece-like collapse seems almost routine.

The Unretirement Movement

Don’t buy into the retirement gloom. I’m not.

Here’s why: The signs of a grassroots push to reinvent the last third of life are unmistakable. Call it the “Unretirement” movement — and it is a movement.

Unretirement starts with the insight that earning a paycheck well into the traditional retirement years will make a huge difference in our future living standards. You — and your skills and talents — are your best retirement investment. What’s more, if society taps into the talents and abilities of sixty-somethings and seventy-somethings, employers will benefit, the economy will be wealthier and funding entitlements will be much easier.

The Unretirement movement is built off a series of broad, mutually reinforcing changes in the economy and society that are transforming an aging workforce into a powerful economic asset. Boomers are the most educated generation in U.S. history and they’re healthier, on average, than previous generations. A century-long trend toward a declining average age of retirement has already reversed itself and — it’s safe to say — you ain’t seen nothin’ yet.

“Many people aren’t slowing down in their 60s and 70s,” says Ross Levin, a certified financial planner and president of Accredited Investors in Edina, Minn. Adds Nicole Maestas, economist at the Rand Corp., the Santa Monica, Calif.-based think tank: “Yes, America has an aging population. The upside of that is a whole generation of people who are interested in anything but retirement.”

Your ‘Next Big Thing

Just ask Luanne Mullin, 60. She has done marketing for a dance company, opened a theater company and run a recording studio. These days, Mullin is a project manager at the University of California, San Francisco, overseeing the construction of scientific laboratories (she does mediation at the school on the side).

“I think there’s more and more of us at 60 who are saying, ‘OK, what’s my next career? What do I want to do that’s fulfilling?’” Mullin told me. “I’m all for what’s my next big thing.”Mullin loves her work, but she’s also wrestling with the same questions as many of her peers. “What is this aging thing?” she wonders. “Am I living fully? Is this the second half of life I dreamed of, or if not, how do I pull it together?”

When Unretirement is Tougher

For many in their 50s and 60s, the transition to Unretirement is much tougher — especially for those who are involuntarily unemployed, like Debbie Nowak.

She didn’t see the layoff coming. Nowak worked for more than 30 years in customer relations for the pensions and benefits department at Evangelical Lutheran Church in America, in Minneapolis-St. Paul, Minn., In November 2011, at 58, she lost her job there.

Nowak, who has a high school diploma, let herself grieve until the holidays were over. In the New Year, she got her severance, went on unemployment and began thinking about embracing something completely different from her old job. “I never thought of myself as a risk taker,” she says. “After 30 years, I thought I should take a risk.”

Nowak had a stained glass hobby, making window panes, mosaic trays, and other objects. That led her to the idea of working in the wood finishing and furniture-restoring business. Last year, she got a certificate from The National Institute for Wood Finishing at Dakota Community Technical College in Rosemount, Minn. To pay for it, Nowak took out a loan and the state chipped in from its displaced workers fund.

Today, she has a part-time job at small furniture-restoration company. “It’s a crap shoot, a risk I was willing to take,” says Nowak. “This is also a way to produce additional income in retirement.”

As Mullin and Nowak demonstrate, we’re living though a period of experimentation while redefining retirement. Many people are stumbling about, searching for an encore career, a part-time job or contract work that offers them meaning and an income.

Some find it extremely tough to get hired, cobbling together a job here and a contract there, assuming they’re healthy. Especially vulnerable are less-educated workers who never made much money or never had jobs with employer-sponsored retirement and health benefits.

How Society Will Change

The rise of Unretirement calls for a whole cluster of changes in how society rewards work, creates jobs, shares the wealth and deals with old age. Unretirement will affect where Americans live out their lives, too, as they seek communities and services equipped for them.

Taken altogether, boomers will construct a new vision of their retirement years, which will impact how younger generations will think about their careers.

“People tend to learn from examples or stories handed down from previous generations — but there are few stories to navigate the new context of old age and retirement for the baby boomers,” writes Joseph Coughlin, the infectiously enthusiastic head of MIT’s AgeLab, a multi-disciplinary center. “When there are no set rules you make them up. The future of old age will be improvised.”

Send Your Unretirement Questions

This blog aims to take a first draft at the Unretirement improv act. I’ll particularly focus on the personal finance and entrepreneurial start-up implications of the movement. I’ll talk about successes and failures, the impediments of age discrimination and the lessons people learn as they search for meaning and income in their next chapters.

Most of all, I hope to hear from you and find out about your experiences so I can address your questions in future columns. Send your queries to me at cfarrell@mpr.org. My twitter address is @cfarrellecon.

Peter Drucker, the late philosopher of management, noted that every once in a while, society crosses a major divide. “Within a few short decades, society rearranges itself — its worldview; its basic values; its social and political structure; its arts; its key institutions,” Drucker wrote in Post-Capitalist Society. “Fifty years later there is a new world.”

The transformation of retirement into Unretirement marks such a divide. Welcome to a revolution in the making.

Chris Farrell is economics editor for APM’s Marketplace Money, a syndicated personal finance program, and author of the forthcoming Unretirement: How Baby Boomers Are Changing the Way We Think About Work, Community, and The Good Life. He will be writing on Unretirement twice a month.

Related Links:

‘Partial Retirement’ Is On the Rise

A Manual for Encore Careers

 

TIME Aging

Centenarians Don’t Die for the Same Reasons We Do

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Howard Kingsnorth—Getty Images

Those who survive to see their second century are indeed different from the rest of us, according to the latest research

Researchers in the UK say that people who live to be 100 or more are less likely to die of the chronic conditions that are the leading causes of death, such as heart disease can cancer, but more likely to die of sudden declines in their health caused by infections or frailty.

VIDEO: Watch: The Island That Holds the Secret to Long Life

After reviewing death certificates of 35,867 centenarians who died between 2001 and 2010 in England, the scientists found that around a third died in assisted care homes. The most common cause of death was frailty or old age (28%), followed by pneumonia (18%). Only 8.6% of those over 100 years died of heart disease, and only 4.4% died of cancer, which remain the leading killers in industrialized nations. By comparison, among those between ages 80 to 85, 19% died of heart disease and 24% died of cancer.

MORE: How to Live 100 Years

Understanding that most of the oldest old, among the fastest growing proportions of western populations, are more vulnerable to sudden events such as infections that can land them in the hospital and on a downward health spiral, should help countries to better prepare for the ever-growing proportion of longer-lived individuals, say the authors. Globally, centenarians are expected to grow from 317,000 to more than 3.2 million by 2050.

MONEY financial advisers

A 90-Year-Old Woman’s Tough Decision

Is it in someone's best interests to give up control over her own money? A financial adviser struggles with the question.

How do you ask a 90-year-old client to give up total control of her assets?

Recently I had a meeting with a long-term client (let’s call her Susan) and her out-of-state nephew in which the nephew and I asked her to resign as the trustee of her own revocable trust.

This is a tough conversation to have. In effect, we were asking her to transfer control of all of her money to her nephew. Susan agreed to do this, but only because she trusts my advice. Talk about responsibility.

Let me provide a little background. Susan hired me as her financial adviser just after the dot-com bust. She was recently widowed. Her husband had put their investments 100% in stocks. Her stocks were dropping in value a lot, she was scared, and she didn’t know what to do. She has no children and wanted most of her money to go to charity when she passed. (Susan was one of the inspirations for a book I wrote: RINKs — Retired, Independent, No Kids.)

We created charitable remainder trusts for Susan, which established annuities for her and helped diversify her portfolio tax-efficiently. We set up a revocable trust for the rest of her assets. With no children, she made one of her nephews a successor trustee for her trusts.

Susan’s investments have grown nicely over the years, and running out of money was never an issue. The issue was her declining health. She moved to a very nice assisted living residence, and we made sure most of her bills were automatically paid because she was becoming confused about money and forgetting to pay some bills. Her tax attorney had been suggesting to me and her nephew that it was time Susan stepped down and let someone else control her finances. I was resistant. I pushed back. My biggest concern: Would Susan be taken advantage of?

Yes, we financial planners go to seminars and meetings discussing estate planning and asset transfers. But nothing can actually prepare you for helping a client make such an important, irreversible decision. How can you advise a client to trust a distant relative when you don’t understand that relative’s own history or motivations about money? How can you explain this to someone, who may not really understand why this will be for her own benefit?

I think you have to rely on your best judgment of the individuals involved. You have to ask a lot of questions. And you have to respect the reasoning why the client, when originally creating the estate documents, would choose this individual over all other possible candidates to be the successor trustee. And that’s what I did in Susan’s case.

Yes, we make the big bucks managing money, and that’s what most people see. But the emotionally hard and more important work is helping clients make the really tough life decisions.

—————————————-

Raymond Mignone has been a certified financial planner and fee-only investment adviser since 1989, with offices in Boynton Beach, Fla., and Little Neck, N.Y. He is the author of the book RINKs – Retired, Independent, No Kids. His website is www.RayMignone.com.

TIME

You’re Older Than You Think You Are

Thanks to your environment, you may actually be older than you think you are

As much as we try to fight it, we’re aging faster than we’d like, and we can blame our own bad habits for some of that. Researchers at the University of North Carolina (UNC) have developed a way to test for our molecular, or physiologic age, which, it turns out, may have little to do with the number that appears on our driver’s licenses.

This age reflects the various assaults on our bodies that come from things such as smoking, tanning, and stress, as well as exposure to ultraviolet light (every time we step outdoors). Led by senior author Dr. Norman Sharpless, director of the Lineberger Comprehensive Cancer Center at UNC, the scientists developed a litmus test for how quickly a group of immune cells known as T cells aged. As cells near the end of their natural life, they start dividing more slowly and accumulate more DNA damage, and that triggers a certain gene to become more active. Using that gene’s activity as a signal of such cellular senescence, Sharpless and his team started to test how different factors affected this gene.

So far, they report in the journal Trends in Molecular Medicine, cigarette smoke and ultraviolent light drove both mouse and human cells to age faster. No surprise there. Chemotherapy drugs use to treat breast cancer also stressed the cells to wear out sooner.

More surprising, however, was that a high fat diet, which Sharpless assumed would also contribute to aging, didn’t make the mice get much older. “Why we got that unexpected answer is unclear—it may be that the mice are different enough from humans, or it may be that the dose [of the high fat diet] wasn’t sufficient,” he says.

The things he and his team tested have involved agents or behaviors that damage DNA. But Sharpless knows that’s not the only thing that turns young cells old. He’s also aware that cellular senescence isn’t the only marker of a person’s physiologic age. But it does provide a good way to put all of our favorite anti-aging remedies to the test—like green tea, exercise and that glass of red wine with dinner. He also hopes that it can be used to predict which cancer patients may experience faster aging from chemotherapy and guide them toward less damaging drugs.

You won’t be able to do that on your own, since harvesting T cells isn’t something that’s available in a DIY kit, but Sharpless has founded a company that is creating a more user-friendly (and commercial) way to track how quickly we are barreling toward our golden years.

TIME Aging

Watch: The Island That Holds the Secret to Long Life

Here's how the people of Ikaria, Greece reach old age

+ READ ARTICLE

Today is the 115th birthday of Jeralean Talley, the oldest living American.

While reaching that age would be considered a feat by many, it’s not so far-fetched to the people of Ikaria, Greece. In 2009, it was named a longevity hotspot for being home to people who reach the age of 90 at a rate two and a half times greater than in the U.S.

“Ikaria’s a very unique island. The people are not what you would find in other places. They have a different lifestyle, a different way of looking at life,” said Thea Parikos, an American-born Ikarian who returned to the island as an adult.

Situated in the Aegean Sea, Ikaria is a mountainous island with a population of 10,000. Winding dirt paths descend toward cerulean water and the faint bleating of meandering goats in the distance can often be heard. The island’s arresting beauty and temperate climate create an enticing atmosphere of rest, but elderly Ikarians thrive on keeping themselves busy.

The remarkable longevity of Ikarians is attributed to multiple factors. A heavily plant-based diet, habitual physical activity such as tending to a garden, social bonds, and a stoic approach to stressful situations have been cited as reasons why Ikaria is home to such a high number of centenarians.

“Everybody’s trying to find the secrets of longevity,” said Xanthi Tigani, who is writing her Ph.D. thesis on Greek longevity at the University of Athens Medical School. “There’s no one thing that can make you grow to be 100 years old or older.”

Nothing can make us stop trying to figure it out, though. And the Ikarians may provide some clues.

Dan Q. Tham is a production assistant for the CNN Documentary Unit.

TIME Aging

Signs You May Be Aging Too Fast

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Klaus Vedfelt—Getty Images

Your body is a masterpiece, so you need to take care of it. With proper restoration, it can be an ageless classic

Your body is like a machine—it wears down over time. But with proper maintenance, you can add years and quality to your life. Here are the numbers you should aim to beat.

Age 27: Muscle Mass May Start to Decline

After this age, men can lose 3 1/2 pounds of muscle per decade, according to a Portuguese study.

Protect Yourself: Twenty grams of whey protein after lifting can boost muscle gains 49 percent, say U.K. researchers.

More: Is your workout burning flab—or just burning up your time? Don’t fall for these 5 fat-loss myths.

Age 35: Crow’s-Feet Emerge

Your skin’s collagen is breaking down—from either smiling or squinting. If it’s the latter, watch out: “There’s a good chance that people with premature crow’s-feet from squinting in sunlight are headed toward future facial skin cancer,” says Neal Schultz, M.D., a Manhattan dermatologist.

Protect Yourself: Wear sporty wraparound sunglasses during outdoor activities like hiking or yard work, says Joel L. Cohen, M.D., a dermatological surgeon based in Colorado. “And apply sunscreen daily, even for your commute.”

Age 43: Words Become Blurry Up Close

Hold this page out at arm’s length. If you’re over 40 and need to squint to read it, you may have presbyopia, a condition resulting from the loss of elasticity in your eyes’ lenses, says Dennis Levi, O.D., Ph.D., a professor at UC Berkeley.

Protect Yourself: Again—wear shades. Sunglasses rated to block 99 to 100 percent of UVA and UVB rays and absorb UV up to 400 nanometers can help prevent eye damage. And if you’re struggling on your computer, increase the font size. Every 2.8-point jump makes tasks seem 8 percent easier, say UC Berkeley scientists.

More: 6 sneaky cancer culprits

Age 45: Age Spots First Appear

Look at the back of your left hand, which receives extra sun while you drive. See brown or white patches? Those indicate damaged pigment-producing cells, which are reproducing too much, says MH dermatology advisor Adnan Nasir, M.D., Ph.D.

Protect Yourself: Whether you see age spots or not, apply an SPF 30 product every morning to all your exposed skin—even your arms—to help prevent skin cancer. If you want to lighten existing spots, use a product with kojic acid, like La-Roche Posay Mela-D Serum ($53, soap.com).

Age 65: Joint Pain Sets In

If your hands, knees, or hips hurt after exercise, you may have osteoarthritis, the breakdown of cartilage between bones.

Protect Yourself: Hit the gym. Overweight or obese people are nearly three times as likely to have osteoarthritis in the knee, the most common spot for older people. Already in pain? Try unloaded exercises, such as seated knee extensions. Japanese researchers found that these may be best for reducing joint pain.

Age 69: Hearing Needs Assistance

The high frequencies that sharpen speech drop out first, so people with hearing loss tend to think others are not speaking clearly, says Pamela Souza, Ph.D., CCC-A, a professor at Northwestern University.

Protect Yourself: Keep headphones below half volume. Listening to an iPod nano for an hour at just 50 percent can temporarily damage your ears, Belgian researchers found.

More: Whether in your 20s, 30s, 40s, or 50+, you can still live great at any age.

 

This article was written by Julie Smith and originally appeared on MensHealth.com

TIME animals

The World’s Oldest Cat Is 24 and Eats KFC

That's twice a cat's normal lifespan

The average cat lives just a dozen or so years, and Poppy, a tortoiseshell cat in England, is twice that old. The cat was just named the world’s oldest feline at the ripe old age of 24.

What happens when you live double your species’ lifespan? Well, Poppy is blind and deaf, but she’s still pretty active, says her adoptive mother Marguerite Corner. And what’s her secret? “I guess she has a good diet and lots of exercise,” Corner says. But every diet needs some treats: “We sometimes give her a bit of KFC chicken, fish and chips and even the odd bit of kebab meat.”

Another key to longevity is not letting anyone mess with your turf. “Poppy is definitely the top cat and she is still quite feisty,” says Corner’s daughter Jacqui. “If one of the other cats tries to eat her food she will bite them on the ear.”

TIME Japan

Japan Is Desperate to Rescue Its Economy from an Early Grave

General Images of Economy Ahead Of Nationwide Quarterly Land Price Data Release
Pedestrians cross an intersection in the Shibuya district of Tokyo, Japan, on Friday, Nov. 22, 2013. Kiyoshi Ota—Bloomberg/Getty Images

Any less than 100 million people would spell doom for the nation's economy, officials warned, while neglecting one glaringly easy fix

Japan’s battle against gray hairs took an unusual turn this week when the Ministry of Commerce set the very lowest acceptable bound for its aging population: 100 million people. Beyond this point, there lays a “crisis.”

Or so warned Akio Mimura, head of Japan’s Chamber of Commerce and Industry. Mimura urged the government to make 100 million the official population target, backed by policies that would promote childrearing. “If we don’t do anything, an extremely difficult future will be waiting for us,” Mimura said.

His concerns are well founded. Japan has one of the lowest fertility rates in the world, with each woman bearing an average of 1.4 children. At that rate, demographers project a plunge from 127 million people today to 87 million by 2060, sapping the workforce of its vital young workers and putting an enormous strain on state finances.

The shrinkage has already begun. In 2013, Japan’s population declined by a record-breaking 244,000 people.

All of which has led to some rather creative policy proposals from the Chamber of Commerce, such as retaining 70-year-old’s in the workforce, doubling government expenditures on childcare and encouraging men to ask working women out on a date.

But once again, policymakers dodged the quickest fix, namely to import workers from abroad. The island nation has an outstandingly small number of immigrants. They form less than 2% of the population, compared with a wealthy country average of 11%. Japan could triple the number of foreigners and still not approach the norm among wealthy nations.

Migrants
Source: UN Population Division of the Department of Economic and Social Affairs

Of course there’s a reason for policymakers’ skittishness around the issue. Immigration reform consistently takes a beating at the polls. One recent survey by Asahi Shimbun newspaper asked respondents if they would accept more immigrants to preserve “economic vitality.” Even with the positive spin, 65% opposed.

Japan Immigration Bureau’s motto is, “internationalization in compliance with the rules.” A simple rule rewrite could alleviate Japan’s demographic fix. It certainly would be easier than prodding the nation’s families to have another 13 million babies. But judging from this week’s presentation from the Chamber of Commerce, it remains politically stillborn.

 

TIME Aging

‘Vampire’ Mice May Hold Key to Eternal Youth

Mouse
Getty Images

New studies published in Science and Nature Medicine find that older mice who are given blood from younger rodents quickly become rejuvenated, raising hopes for treating age-related degenerative conditions in humans like dementia and Alzheimer's

Aging mice gain energy, while also exhibiting greater strength and memory, when injected with the blood of younger specimens, according to a new study.

Scientists at Harvard and the University of California, San Francisco, carried out experiments on rodents with ages equivalent to humans in their 20s and 60s.

A protein called GDF11 — also found in human blood — is behind the rejuvenating properties, they suggest in research published in the journals Science and Nature Medicine. Concentration of the substance appears to decline in advanced years.

The findings could be used to treat age-related diseases such as dementia and Alzheimer’s. However, some have cautioned that stimulating the rapid regrowth of cells could possibly lead to increased risks of cancer.

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