Health

What Happens If I Can’t Retire?

September 9, 2009 By Jennifer Derrick 9 Comments

In financial circles the big push is to get people to save enough money so that they can retire in comfort. That’s a noble goal, but the fact is that more and more people aren’t going to be able to retire, at least not in the way that they dream about. Pensions are a thing of the past, Social Security is iffy at best, and many people simply haven’t saved enough to cover both ridiculous health care expenses and a life of leisure.

We all dream of the life of leisure, the daily golf game, and the fantastic trips, but reality is likely to be somewhat different than our dreams because the money just won’t be there. Nobody wants to talk about what happens at that point. So what happens if you arrive at your retirement age, or you get close, and you discover that you don’t have enough? What can you do, beyond saving as much as possible?

The most obvious answer is to work longer. Putting off retirement for even a couple of years gives you a chance to save even more money. You don’t have to work at your current 9 to 5 job, either. Maybe you take this opportunity to start your own business or take a job in a field you always wanted to try. If you have to keep working, no one says that it has to be in a job you hate. In fact, continuing to work well past retirement age, even if only part time, not only allows you to save more money, it may save your sanity. We all think we want to quit working but a lot of retirees, after living the life of leisure for a couple of months, find that they are bored and that they miss making a contribution somewhere. They miss the socialization, too. If you can find work that you love, you may find that you prefer to keep working.

The other thing you can do is to adjust your expectations for your retirement. In other words, get real with yourself. If you know you don’t have a lot of money, don’t delude yourself. Don’t retire and then go on a binge of trips and leisure activities and drain your resources within the first five years of retirement. Adjust your expectations downward. Realize that you can’t take five luxury trips a year and be happy with one budget trip. Realize that you may have to work and find a way to be okay with that. Accept that you may have to sell the big house and move to a condo. Don’t dwell on what cannot be or waste your remaining time asking “what if.” Get out there and do what you can, but be realistic about it and accept that maybe you have to reduce your expectations a bit.

Retiring into a life of leisure is a fairly recent concept. Our grandparents worked until their health failed and they had no choice but to stop. Maybe they scaled back on their hours, but they still worked. The idea of simply sitting around and doing nothing or traveling full time is a new idea (made possible by a marketing machine that wants to push seniors into all kinds of activities) and it’s an idea that simply may not be possible or even advisable. We live longer now and if you retire at sixty-five, your money may very well have to last thirty years. Unless you have a lot of money, the retirement ideal that is pushed by the marketers is a distant dream. Thanks to rising health care costs, even with the best savings habits in the world you may still not have enough to support yourself without working at all for the remaining years of your life. And if you can? Great, but keeping yourself active and involved in something is likely to keep you healthy and mentally strong much longer than doing nothing but playing golf all day.

The better answer may be to gradually phase working out of your life. Maybe at sixty-five you trade in the 9 to 5 desk job for a job in a museum or something else that you really enjoy. Or you piece together a couple of part time jobs. Then at seventy you scale back to part time hours. At seventy-five, maybe your income comes from a hobby that you can pursue at home and turn into a little cash. Maybe you work at that until your health prevents you from working at all. You can still have some of the joys of retirement on such a plan because you’re working a “job,” no longer chasing a “career” that sucks up all of your time. You can travel and spend time with the grandkids, but still have some money coming in on the side while keeping yourself engaged in society.

Certainly you should strive to save as much as you can during your prime earning years. Whatever your “retirement” consists of, you can bet that big health care expenses are going to be part of it and you’ll want enough money to take care of yourself without subjecting yourself to government assistance. But if you end up having to work a little longer than you hope or you end up with a smaller retirement budget than you dream of, it doesn’t have to be the end of the world. There are positives to a “retirement” that still includes work.

YMCA Membership Benefits

September 5, 2009 By David G. Mitchell 7 Comments

I have successfully completed a month of visiting the gym. More specifically, I have religiously gone to the gym twenty-six times in the past twenty-nine days. I am certainly not remotely close to winning any body building prizes, but I am quite proud of myself.

OK. Don’t roll your eyes. I am not going to start preaching to you that you should be exercising more. That is your decision and I respect your decisions, especially when I know that my new found zeal for going to the gym could wane in the weeks and months to come. Nevertheless, I am enjoying myself and that is because I am getting so much more than a workout from the gym.

My wife and I have a family membership to our local YMCA, a truly beautiful, recently renovated facility. For that, I believe we pay $79 per month – about $1.33 per day for each of us. In exchange for that $1.33 per day, we get huge value that makes the expenditure the last one we would ever cut from our budget, long after satellite television, the cinema and pretty much everything else in our lives other than our kids.

For example, the most obvious benefit that we get from our YMCA membership is access to a huge weight room that offers an enormous range of weight training options. My wife likes to life free weights, so she tends to use the free weight area of the gym and occasionally stops at a weight machine for specific exercises. In contrast, I like to work a specific routine on machines equipped with Fitlinxx computers which monitor my progress, help me to maintain my pace and record my weightlifting data so that I can access it at the touch of a button. If my wife and I were to try to recreate our YMCA gym at our home, it would occupy our entire home and cost us much more money than we could ever begin to afford. That is only one of the possible benefits of a membership at a good gym.

Numerous Cardiovascular Options

Our YMCA offers numerous treadmills, different types of stationary bicycles, two types of stair climbing machines, elliptical machines, rowing machines and other types of cardio equipment. Those machines give us multiple options for varying our workouts and each is equipped with a television monitor. I can watch any program I want to watch while I get a cardio workout and it really helps to make the workout go faster.

Trainers to Offer Advice

Our gym has numerous trainers walking the floor and ready to answer questions about technique and appropriate training methods. We never need to worry about injuring ourselves because of bad form because we know that if we do not know how to do something, assistance is always available.

Classes, Classes, Classes

Our gym offers yoga, dance, Zhumba (although I have no idea what that is), Pilates and a bunch of other classes for all age groups and levels. I do not use these classes because exercise is a solitary activity for me, but there are sometimes lines out the door full of people who really love such group classes. My wife takes numerous spinning classes and swears that it has done wonders for her cardio health.

Child Care

Neighbors, who did not have a gym membership, always lamented that they could not exercise because they had no one to watch their kids. Our YMCA offers free on-site child care. When my children were younger and I was at work, my wife would take them to the child care center when she arrived at the gym and they would enjoy games with their peers while my wife worked out. She could spend an hour and a half to two hours working out and checking up on the kids every so often and that gave her piece of mind and time for a work out without adding the need for a baby sitter.

Children’s Activities

Even if you do not belong to a YMCA, if you have young children there is a good chance that they have played sports at the Y. YMCA members receive a substantial discount on sports registration fees. Our discounts paid for half of our yearly membership fees when our kids were much younger. Our YMCA also offers youth dances with reduced admission charges for the children of members. For older kids, our YMCA offers a free youth center that has Foosball, pool, television and other activities.

Adult Sports Leagues

Whether you play basketball, softball, flag football or something else, your gym may offer a venue for adult sports leagues. Registration costs are usually reasonable and the social opportunities are tremendous.

Swimming

Swimming pools are expensive to maintain. If you belong to a good gym with a pool, you can consider buying a home or renting an apartment that does not have pool access. Our YMCA has multiple pools and offers a “Dive-In Movie” on Friday nights during the summer so that families can watch movies in the pool or by the pool.

Sauna

Even if you do not exercise, the amenities in the locker room at a good gym can be excellent. On an off day from your exercise routine, if you feel like a sauna or a steam bath, your local gym may give you the means to do so.

What motivates you to go the gym? What value do you see in a gym membership? If you are not a member of a gym, how do you exercise? If you do go the gym, what gym do you think offers the best value?

Are Restaurant Deals A Good Trend?

August 13, 2009 By David G. Mitchell 11 Comments

A few months ago, I wrote about the death of the DVD as a major delivery platform for movies. At the time, my local video store was charging $5 for five-day movie rentals and its stores were generally not very busy (based on my observations). By contrast, the local library was increasingly busy and even more increasingly devoting shelf space to DVDs.

Fast forward to the present, and the decline of the DVD continues. At the same time, Blockbuster has introduced new pricing models which make rental at times a more attractive option than the library. Blockbuster customers now have the added option of renting a new movie for $2 for one night or an older film for only $1. I love the new model and I admit that I am now occasionally going back in to Blockbuster.

I will gladly pay a dollar or two for a movie rental for a night after I have checked the library (less than a quarter mile away) to make sure that I cannot borrow the movie for free for a week. If my family really wants to watch a particular movie, the rental cost is consistent with the value of the instant gratification that Blockbuster is more likely to present, especially with respect to the rental of new releases. My local video store still is not as busy as it was three or four years ago, but the dollar rentals have made it busier than it was at this time last year, or so it seems to me.

I’ve noticed that a lot of local establishments are following a marketing plan that seems similar to Blockbuster’s. They are lowering prices. Restaurants in particular are offering some amazing deals on meals, including multi-course feasts. Throughout much of August, for example, Maggiano’s Little Italy is now offering a BOGO deal on its pastas as part of its “Today and Tomorrow” promotion. Other nearby higher end restaurants are offering deep discounts on three course meals and dinners for two.

Unlike the price reductions on DVD rentals or other hard goods, which I enjoy, I am not quite as certain that huge price reductions by restaurants are a good thing. With a DVD, whether I pay $1 or $5 or get it for free at the library, I am getting the same product. With food, however, we are much more likely to “get what we pay for.” If dinner for two cost $49 two years ago and the same meal is now offered for $25, how does the restaurant make any money?

I suppose that the restaurants may be relying on patrons to enjoy their meals with selections from the bar, and that a three course meal will ensure that several trips to the bar are possible. Nevertheless, I have to wonder how much of a bar bill patrons will run up if they are attracted to a restaurant by a deep discount on the food.

If restaurants are not using multi-course meals as loss leaders, could they possibly have been making so much of a profit two years ago that they can cut their prices in half now and still make money? I hope not because if that is the case, it will make every meal I have ever had in a restaurant seem more than a little tainted.

And that brings me to my third thought — could restaurants be cutting the quality of their ingredients in order to offset their lower prices? I know that if I want to cut my weekly grocery bill, apart from taking advantage of sales and coupons, I can seek lesser quality ingredients. While that does save me money, it also often cuts the value of the meals that I prepare and decreases the pleasure that I have eating the meals that I cook.

What do you think? How can restaurants cut their prices so much and still make money? Are they sacrificing profits or cutting back on quality? What do you think?

Healthy Couponing

August 12, 2009 By Jennifer Derrick 10 Comments

It’s no secret that I’m a big coupon user. When I mention this to people, I get one of three reactions:

1. “Hey, that’s great, how much do you save?”

2. “You must have a really unhealthy diet because coupons are only for junk food. It’s not worth it.”

3. “You could save so much more if you bought store brands.”

Number one makes me smile because I know I’m in the presence of someone who understands. Number three makes me sigh because I know that store brands are usually cheaper. I only use coupons when the name brand with coupon is cheaper than the store brand, or when I just cannot stand the store brand. I know the game and get a little irritated when someone assumes that I’m doing it wrong.

It’s number two that really raises my hackles. I get a little angry when people assume that, because I’m using coupons, I’m feeding my family nothing but cookies, chips, and boxed mac and cheese. While we do enjoy those things some of the time, in moderation, we actually eat very healthfully. And we still use coupons. How can that be?

Coupons have come a long way in recent years, partly because food manufacturers have also come a long way. We now have many more organic, vegetarian, natural, low sodium, and sugar-free alternatives than we used to. Many are made by national manufacturers who are willing to put out coupons for their wares. It’s not uncommon for the Sunday coupon flier to feature coupons for natural peanut butter, organic cereals, eggs, low sugar/sodium alternatives, bagged salads (not always economically sound, but certainly fast to make when you’re in a hurry), frozen and canned vegetables and fruits (which have been shown to be as healthy as fresh and without the spoilage problem), whole wheat breads, milk, yogurt, flour, and soy products. Yes, there are coupons for sugary cereals, Pop Tarts, boxed mac and cheese, high sodium dinner kits, and sodas, but there are still plenty of options for those who prefer healthier items.

I tend to score my best coupons for “healthy” products directly from the store fliers. They often have coupons for fresh meat and produce, store brand milk, eggs, and cheeses, fresh deli products, and baking products like flour and spices. Usually these work in conjunction with the store’s loyalty card. The loyalty card brings the price down a few cents and then the coupon brings it down even more. Or there are often coupons like $5 off a $50 purchase. You can use this coupon to buy anything you want, healthy items included.

Several of our stores now offer eCoupons in addition to their regular fliers. When you register at their site, they send you an email alert letting you know that there are new deals available. When you go to the website you can choose which of the “coupons” to add to your loyalty card and create a shopping list. When you get to the register with the items and swipe your loyalty card, the “coupons” are automatically deducted from your order. The stores here frequently include meats, produce, and dairy items in these deals, as well as name brand healthier products like Kashi, Stonyfield, Morningstar, Bocca, and others.

This past week I made my bi-weekly trip to the grocery store. Here are some of the “healthy” coupons that I used:

Free milk with purchase of bananas: That one was in the store’s flier.
$0.50 off five Del Monte canned vegetables. These were on sale, plus the store doubled the coupon, making the name brand cheaper than the store brand.
$1.00 off Kashi cereal
$0.75 off Egglands best eggs. Again, doubled and on sale made them cheaper than the store brand.
$1.00 off any Morningstar vegetarian item.
$1.00 off a bag of potatoes (from the store flier)
$1.00 off bagged salad
$1.00 off six cups of Stonyfield yogurt
$0.50 off 5 lbs. of flour (from the store’s flier)
$1.00 off Sara Lee whole wheat bread
$5.00 off a $50 purchase
$.50 off Smuckers Natural peanut butter
$1.00 off Tropicana low sugar orange juice
$.50 off Dole canned fruit
$1.00 off popcorn (the kind in a jar you pop in an air popper)
$0.75 off low fat cottage cheese
$1.00 off Steam Fresh vegetables
$1.00 off mixed bag of apples and oranges. From the store’s flier.
$.50 off any produce item. This was an eDeal.

Couponing no longer means that you have to choose unhealthy foods. There are many healthier alternatives available now and coupons to match. Even if you don’t want to use food coupons because you still believe you can’t eat healthfully, coupons are widely available for toiletries, paper goods, cleansers, pet products, and other household items. Those can still help you save money, even if all you ever eat is raw produce. Even if all I used on my recent trip was the $5 off $50 coupon, that would still have been well worth the time it took to clip it and stick it in my purse.

Using coupons does not automatically doom you to an unhealthy diet. Yes, sometimes there is nothing in the Sunday coupon fliers for healthy products. Look around a little more. Try your store’s flier or see if they have eCoupons. Check the next week’s paper as you might have better luck then. If your store never offers any coupons you can use, try writing to their corporate headquarters and making your needs known. If enough people complain, maybe they’ll start adding more healthful coupons and deals. Over time you can find coupons that you can use. And when you hold out to combine those coupons with sales, you can eat healthfully on a budget.

What My Mother’s Illness Taught Me About Personal Finance

May 2, 2009 By Jennifer Touchette 5 Comments

When my mother became ill a few years ago, I did what all adult children usually do: worry and think, “She has to be OK! She’s the parent.” Finances, however, didn’t enter my mind.

It was interesting to note that my parents – level-headed as always – remembered to consider the financial repercussions of Mom’s illness as well as the health repercussions. Because of that, their finances were able to weather the upheaval that an illness can cause.

Finding the best deal: It may seem unthinkable to “shop” for a doctor and treatments when facing a major illness, but that is what my parents did. Cancer is a tricky disease because one never knows how an individual will respond to treatment once the diagnosis is complete. For Mom, it was recommended that she have both surgery and chemotherapy, both of which came with huge price tags. Always the thrifty shopper, she and my father considered the best prices as much as they were able. Their shopping around was not necessarily for the benefit of their insurance company, but because they knew this illness could cost enough to reach the caps of their coverage, and then they would be responsible for the extra costs.

After many discussions with her doctor and the second-opinion doctor, combing the Internet and reading whatever they could get their hands on, my parents decided it would make the most sense financially to have the surgery performed in their hometown. Thanks to the recently updated surgical facilities, the cost-benefit of driving two hours away to the next big city was minimized. The surgeon my parents chose was as experienced as the one they considered in the other city, and the hospital where recovery would begin was smaller, yet cheaper, with a good nursing and support staff.

After the surgery and hospital stay, recovery continued for Mom at home. Thankfully, she had a live-in caregiver – my father – to take care of her; so considering the cost of hired help was not an issue.

My parents also considered going out of town for the chemotherapy, but the cost of driving to the next big city together with discomfort of the chemotherapy symptoms and exceptional local cancer treatment center, swayed my parents to again stay in their hometown.

Still terrifying, those bills: When the bills started arriving, the totals were frightening. I wasn’t much help as I gasped about the costs, but my father steadfastly called the insurance companies when something seemed amiss, paid what they owed and took Mom to her aftercare appointments. I was able to pitch in and complete by father’s regular tasks, such as taking care of the yard, cooking a bit and such, which would have either been ignored or hired out if I hadn’t been able to be there.

My parents did have to dip into their savings to help pay everyday expenses, co-payments and other medical bills they were responsible for when the insurance topped out. Thankfully, they had socked away enough money to cover six months of expenses in their savings. Also, years before Mom got sick, my parents had taken out cancer treatment coverage out with AFLAC. It really helped at a time like this to have the extra cash available when my parents needed it most.

Sadly, the combination of cancer and pre-existing heart disease finally took Mom. My father, while desperately sad, was not burdened with the additional worry of being financially destitute from the cancer treatments, thanks to their good planning and research.

Lessons learned: With the recession looming, medical costs and lack of health insurance make a major illness even scarier. Hopefully, I will be able to help my father as valiantly as he helped Mom should he get ill. Therefore, I’m going to strive to:

Encourage my father (and myself) to maintain an emergency savings account to draw from for medical, and other, emergencies.
Shop around for medical care, especially to strive for the best combination in medical care and cost-effectiveness.
Remember to consider recovery costs. Will I need to hire people to help with cooking, cleaning, personal care, etc.?
Keep my head about me when the big medical bills arrive and deal carefully with the insurance companies and medical facilities.
Be confident of a cure, but also prepare for final costs, including creating a will, burial, and considering another person to take over the finances, if necessary.

Flu Financial Preparations Revisited

April 25, 2009 By Jeffrey Strain 4 Comments

Editors Note: With the Mexican swine flu making headlines, a trip this weekend found my local drug store had nearly run out of surgical masks – if you haven’t already made preparations, it’s certainly the time to do it while supplies are still available. This is an article that was written toward preparing for the avian flu, but the fundamentals are the same for both

I wrote about this a couple of months back – being in Asia when the SARS outbreak happened probably makes me a bit more paranoid, but with it spreading widely in Europe now, it seems just a matter of time. This is what a recent USA Today article recommends:

Food: Items that can be eaten without cooking (in case the power is out), such as peanut butter and crackers; canned meat, fish, fruits and vegetables; baby food and formula; dry cereals; protein bars; beverages; and a manual can opener.
Medical needs: Prescription medicines such as glucose and blood pressure monitoring equipment; anti-diarrhea medicines; a thermometer; and fluids with electrolytes (such as Gatorade or Pedialyte). Stock up on personal needs such as toilet paper, baby diapers, feminine supplies and hand-washing supplies.
Activities: Home-learning supplies, in case schools are closed, and toys, books, games and DVDs to keep people occupied.
Other supplies: Flashlight, portable radio, batteries, trash bags, bleach, paper towels and matches.

and what I previously recommended:

1. Buy a good supply of surgical masks: You can get these at your local drug store or home improvement store. Once the outbreak happens, there will be a run on these at your local stores and they soon won’t be available. Supply and demand will cause their prices to rise quite a bit in second hand markets like ebay. How do I know? That is exactly what happened in Japan when the SARS outbreak occurred.

Purchase face masks early for bird flu financial preparation

The masks are not so much for preventing people from coughing directly in your face as keeping your hands away from your nose and mouth. The virus is much more likely to be transmitted as follows than you getting coughed on directly in the face:

— Someone with the virus touches his nose getting the virus on his hand

— He opens a door leaving the virus on the door knob

— You opened the same door after him getting the virus on your hand

— you unconsciously touch your nose contracting the virus

Which brings us to number

2. Get in the habit of washing your hands regularly: As a former teacher with lots of kids running around with runny noses, you learn to wash your hands constantly to make it through the school year without getting sick. If you have kids, get them in the habit of washing their hands several times a day (the more the better). Once the flu comes, if they aren’t in the habit of washing their hands often already, you aren’t going to be able to teach them in that short period of time.

3. Wash thoroughly: From what I’ve read, bacterial soap in itself won’t kill the flu virus, but the main reason to wash you hands isn’t to kill it.

“The soap isn’t meant to kill the bug, its purpose is to make your hands slippery, so the virus slides off under water.”

That means taking the time to wash hands thoroughly so all the virus slips off.

4. When the outbreak occurs, change your habits: You’re not going to be able to lock yourself inside when the outbreak occurs since it will last a full season (several months), but avoiding crowds will be a good habit to get into. Crowds are always an easy place for the flu to spread. If you have kids with play groups or other activities, you’ll want to consider cancelling them for a season.

5. Get the vaccine immunization when available: I doubt the government will have enough medication to go around when the flu outbreak occurs and the limited supplies they have will go to high risk patients (elderly, children, those with compromised immune systems, etc). The fact is, antibiotics don’t work on the flu virus (they work on bacteria), so there is little the doctor can do once you get sick. Since the virus will be totally new, even the drugs that doctors think may help in reality may or may not, so you don’t want to count on these (thus prepare not to get it in the first place). Once the virus is identified, however, they will culture it to make a vaccine. As soon as that vaccine is ready and available, get immunized with it.

While nobody hopes that this happens, experts say it’s only a matter of time – if not this avian flu, then some other. Preparing and stocking up now will not only better your chances of avoiding the flu all together, preparation will save you a lot if prices spike due to panic.
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More on the bird flu from the personal finance arena:

From Mapgirl’s Fiscal Challenge: Washing Your Hands Saves You Money