Retirement Communities Selling to Younger People

Retirement communities across the United States face an influx of younger families after being forced to reduce or scrap age restrictions for residents in order to sell houses in the current economic meltdown. In an attempt to stimulate sales, developers and community associations are reducing minimum age requirements, usually set at 55 or more, for new buyers at many retirement communities. At some new developments, age restrictions are being eliminated.

New Year’s Resolutions

Fidelity has suggested several age-based retirement resolutions for Americans to consider to kick-off the New Year. The resolutions offer guidance for investors in three different life stages, whether they are getting started, saving, or preparing for retirement.

Retirement Resolutions for Investors Getting Started (25-35 Years Old)

• Enroll and contribute to your workplace savings plan such as a 401(k)
• Develop a plan to reach long-term goals
• Open and contribute to an IRA based on your savings goals.

Retirement Resolutions for Investors in the Accumulation Stage (36-54 Years Old)

• Monitor and rebalance your portfolio at least once a year
• Catch up and/or max out on retirement savings vehicles such as a 401(k) or IRA
• Simplify and consolidate your assets
• Reduce high interest credit card debt and
• Build an emergency fund.

Retirement Resolutions for Investors in the Pre-Retirement Stage (55+ Years Old)

• Wait past age 62 before taking Social Security benefits if you have other sources of income, are in good health, plan for a longer retirement, or plan to continue working.
• For those who want higher payments later on to cover rising expenses like healthcare, but need supplemental income until Social Security payments start, bridge the income gap with funds, bonds or annuities. this strategy allows for maximum payments while also generating short term income to cover immediate expenses.
• Take Social Security benefits at age 62 if you need them for immediate expenses like healthcare costs.
• Create a retirement income plan to determine when you can retire and ensure a steady “paycheck” to cover your most important expenses in retirement
• Sign up for Medicare at age sixty-five

Ways to Protect Your Nest Egg

Though stock market values may be battered and the economic outlook grim, older investors can draw on a number of different strategies to keep their nest eggs from being wiped out.

• Tap taxable accounts first so your non-taxable accounts, such as a Roth IRA, can grow tax-free
• Go for total long-term return on stocks-don’t sell them in a panic
• Insulate yourself from inflation through treasury inflation protected securities (tips)—they offer investors a fixed interest rate above inflation, as measured by a consumer price index.,
• Consider converting your traditional IRA to a Roth IRA

Tax Relief for Seniors

Congress has approved tax relief for seniors who hold traditional individual retirement accounts. A new law awaiting the president's signature will suspend the required minimum withdrawals that people aged 70 1/2 and above must make from their individual retirement accounts for the year 2009.The goal is to give these accounts time to recover before the 2010 required distribution.

Defined-Benefit Programs Supporting Increased Payouts

State and local government defined-benefit employee retirement systems paid $168 billion to 7.5 million retirees and survivors in fiscal year 2007, the U.S. Census Bureau has reported. This is a $12 billion increase from the previous year when 7.3 million received payments.

The Error of Ford’s Ways

A judge has ordered Ford Motor Co. to start discussing settlement of a lawsuit filed on behalf of employees who had company stock as a retirement investment. In a key ruling this week, U.S. District Judge Stephen Murphy allowed the 2006 lawsuit to go forward over Ford's objections.

Current and former nonunion workers say it was a mistake for Ford to offer company stock as an investment for retirement. From April 2000 to April 2006, the stock fell approximately 70%.

States Ranked by Number of Public Employee Retirement Systems

Pennsylvania has more than nine-hundred public employee retirement systems, and Illinois, more than three-hundred fifty. They have the most public-employee retirement systems of all the states. In contrast, Hawaii and Maine had the fewest: each has one system to serve all public employees in their states.

CalPERS Plummeting

The California Public Employees Retirement System’s (CalPERS) investment fund is now worth $184.4 billion, 23% smaller than it was on June 30, 2008.

Another New York Retirement Scandal

A high-ranking New York state official who was listed as an employee of two New York agencies at once was improperly awarded state retirement benefits in one of the jobs and may have shortchanged his hours in the other. Continuing a crackdown on abuses in New York's multibillion-dollar pension fund. The employee in question was paid $24,000 a year as general counsel for the Olympic Regional Development Authority (ORDA) while also getting $146,699 as executive director of the state Racing and Wagering Board.

Auditors have said ORDA should treat him as an independent contractor, saving about $4,000 a year in retirement, Social Security and Medicare payments.

Winter Texans

Since they began coming here in the 1930s, Winter Texans have provided one of the Rio Grande Valley's greatest economic engines. Retirees seeking refuge from icy Northern winters spend an average of four months of the year here, pumping as much as $600 million annually into the economy, according to studies by the University of Texas-Pan American.