Long-term Care and Expenses Broken Down by State

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My work with clients often brings to the fore-front a question on how to plan financially for aging parents.  Long-term care is just flat out expensive and on average, 1 in 2 people will need some type of care during retirement when incomes are fixed and protecting assets is critical.  First, understanding cost and pricing are important to the planning process.

This article in the Wall Street Journal just last week, provides some good insight and information to consider planning financially for assisting aging parents who might need your assistance with care or planning for oneself:

WSJ Long-term Care Costs

Gender Roles and Investing – “Men buy shares from Venus and women have investment savings from Mars”

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There may in fact be gender differences in approaches to investing and history has confirmed that there is a net positive benefit for women investors; however, the approach may go beyond just gender.  The article below from Investopedia is enlightening and includes several pieces of research from England and Germany:

 

https://www.investopedia.com/articles/basics/11/myths-and-realities-gender-finance.asp

Lessons for Teenagers – understanding debt and the cost of a loan

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As so many adolescents and young adults head off to college during this season, they are faced with various financial decisions, many of which are completely new and in uncharted territories.
Starting early with small lessons can help better prepare, especially our young women, to develop the tools needed to engage with a knowledge base instead of emotion when seeking financing for college or a car to get to work.
This article posted by Women Who Money provides some good insights and tools to assist in guiding our younger generation:

https://womenwhomoney.com/help-teenager-understand-loans/

Inflation vs. The Cost of Living – Quantifying a Female Variable

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When planning for retirement, remember it is key to understand that difference between factoring standard inflation (the cost / purchasing power that is lost over time) and the cost of living that is specific to you.  One of the key components to planning for a retirement that will last, is to understand what your standard of living will cost in the future and to plan accordingly with a sustainable investment design:

https://www.nj.com/business/2017/03/growing_poorer_inflation_vs_cost-of-living_biz_bra.html

The Australian Economic Miracle

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According to the Organization for Economic Cooperation and Development, Australia has the longest sustained expansion on record, at 28 years. They have not experienced a recession since 1991.

-The New York Times, April 6, 2019

THE 1 – 2 FINANCIAL STEPS FOR ALL WOMEN THAT WILL ENHANCE RETIREMENT

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As mentioned previously, women are much better at saving money and when they do invest, they have a slightly better long-term return on their investments.  A third component to building wealth and preparing for a successful retirement is long term financial planning. 

Engaging in decisions early in life and in relationships for purposes of planning for the years ahead are just as crucial as shifting assets from saving to investing.  This article from CNBC highlights the fact that women should be taking steps in the direction of planning, not just investing:

https://www.cnbc.com/2019/03/18/women-are-more-likely-to-leave-money-decisions-to-their-spouses.html

Women and Financial Literacy – generate compounding returns of their own!

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Increasing your financial literacy as a woman is an investment of its own.  This article from Forbes does a very good job at explaining why continually increasing your financial literacy, especially for women, is crucial and starting sooner rather than later has its own compounding effects.

https://www.forbes.com/sites/elizabethharris/2018/04/30/new-studies-highlight-why-women-must-become-more-financially-savvy/#769ac4fb7062

Women and the Importance of Retirement Saving:

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Women should be placing a greater importance on their focus towards retirement planning and making this focus intentional by way of saving, systematically.  Primarily women cost more, we live longer and incur statistically more healthcare costs as compared to our male counterparts.  Yet, women today still do not list saving for retirement as a number 1 priority.

The article below from Forbes raises awareness for women to realign their focus for retirement planning and creating this objective as a number 1 priority:

https://www.forbes.com/sites/elizabethharris/2018/03/28/new-study-may-explain-why-some-women-save-less-than-men-for-retirement/#1a5457483e52

Taxation of Social Security Benefits and Translating the Confusion

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The taxation of Social Security Benefits is often a shock to most people as it is commonly assumed that after age 70, those benefits are not taxed.  The taxation of benefits is based on your income which also includes investment income and non-taxable bond interest irrespective of age.

If you have a combined income greater than $34,000 annually ($25,000 for single filers), then a portion of your benefits will be taxed regardless of age.  Also note that RMD’s (required minimum distributions) are considered income and will add to your base for calculating how much of your benefits are taxed.

This is a great article from AARP that explains the details and caveats for the taxation of your retirement benefits.  If you have further questions or if can assist you with better understanding your unique situation, please contact my office on 703-535-5921 or send an email to [email protected].

https://www.aarp.org/retirement/social-security/questions-answers/how-is-ss-taxed.html

Tax tips and mistakes to avoid as you begin to prepare your taxes for 2018:

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https://www.fool.com/taxes/2019/01/27/3-costly-tax-mistakes-to-avoid.aspx