Money and More© November 10, 2018

What is Retirement

The retirement years, for many, no longer exists the way they use to be for the early baby boom generation.  Pensions are no more for many people.  As a result, they must live on Social Security and the savings from a life time of working.  Some folks continue to work into their seventies and beyond.  Some folks work for the money and others to stay busy and feel fulfilled.  Retirement in the past often meant reaching a certain age and stopping work.  Today, the term “Financial Independence” often replaces the term “retirement.”  As our society grows older with generally better medical care people are having longer enjoyable lives that requires finances that will 30 to 40 years.  What does retirement mean to you?  What are decisions are you making today about tomorrow?

Life Planning

This week I have had the privilege to attend Life Planning Training presented by George Kinder, the father of life planning movement.  Life planning is important niche of financial planning that planners use to help clients reach their dreams.  As I learned in class this week, most folk’s critical dreams are not constrained by their finances as much as by themselves.  The life planner helps their clients integrate the work to reach their goals and dreams into their current life by creating focus and deliberate energized action.

Bond Ladder

A safe way to create an income stream in retirement is with a bond ladder.  A bond ladder is way of creating income for each year of financial independence.  Picture a ladder with each step or rung representing a year.  Purchased bonds will mature or turn into cash for each rung or year on the ladder.  Each year the money becomes available for the next year’s spending.  These are great to fund out to 15 years in the future.  US Treasury strips are my preferred bond for such a ladder as they fully backed by the federal government in same way FDIC protects bank accounts.  Though unlike FDIC insured accounts there is no maximum account size.

Discount Gift Cards

Looking for a way to save some money this holiday season.  Gift cards can be purchased online at discount for your favorite retailers.  This especially handy when making purchases online.  Using I was able to locate cards at for about 16% off.  That combined with a 25% online promotion allowed me to get approximately 40% off on a new winter coat.  Most discounts are smaller though I saw Starbucks for 10% off when I looked this week.  Happy Shopping!!

Social Security

Social Security is critical part of most average people’s retirement income.  While the basics I describe here are not too complex,  there are very specific rules and processes that govern social security benefits.

In simple terms, to earn social security a work must work for 40 quarters which means the equivalent of 10 years.  In 2018 workers must earn $1320 per in 2018.   Once reaching age 62 workers are eligible to start drawing social security.  If they are still working the social security will claw back $1 of benefits for $2 of earnings once wage income exceeds a certain level which is $17,040 in 2018.

The calendar year after a worker reaches full retirement age (age 67 for those born after 1960) a worker no longer will have the wage-earning limitations.  Note that there are special higher earning limits the year of retirement.  Those drawing prior to full retirement age will receive lower benefits that decrease about 8% for each year before full retirement age.  Those that delay benefits from full retirement age up to age 70 receive and extra 8% per year.  A person born after 1960 will receive about 25% more for the rest of their life by waiting the three years.

There are many details that a financial planner can help weed through.  The social security website has a lot of great information.  See for more details.  Better yet sign up on the website to check out your predicted retirement benefits and confirm your earnings record.

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