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Vol. 29, No. 2 • February, 2011 / www.Freeman-Spicer.com
[Remembering Eli Spicer 1914-2009]
The Quote . . . “Light travels faster than sound - isn’t that why some people appear bright until you hear them speak?” (Steven Wright)
Baby-Boomers Blues . . . . . . It’s every homeowners dream: making that 360th payment and finally getting to burn the mortgage. But in the years leading up to the recession, many Americans treated their homes like bottomless piggy banks. And as baby boomers now approach retirement, many are facing a harsh reality: the Grim Reaper could come calling before they ever pay off their mortgage. “A lot of them were seeing equity in their home and felt comfortable not putting money into retirement,” says Dean Baker, the co-director of the Center for Economic and Policy Research in Washington. “They’ve been completely wiped out.” Since 1989, the percentage of Americans ages 55 to 64 who still have a mortgage has risen from 49 to 63 percent, according to Harvard’s Joint Center for Housing Studies. During that same period, the median balance owed by this group has nearly tripled, to $85,000. The trend isn’t unique to just U.S. In the United Kingdom - where similarly lax lending standards and tax policies also helped create a housing bubble - a quarter of people ages 55 to 64 are still making mortgage payments, according to Aviva, the insurance giant. Of course, many Americans have refinanced responsibly and are using the money they’re saving on interest to pay off their mortgages in, say 15 years. But with so many 50-somethings saddled with first mortgages, along with large home-equity loans, many may never be able to rebuild their nest eggs. In other words, when it comes to retirement, 75 may become the new 65. (Newsweek)
Retiring In The Red . . . . . . Facing mounting medical expenses and insufficient savings, a growing number of seniors are falling into credit-card debt and spending their golden years in the red. Over the past decade, that’s led to a spike in bankruptcies among older Americans, according to a recent study by John Pottow, a law professor at the University of Michigan. He found that people ages 55 and over now account for more than 20 percent of all bankruptcies in the United States, compared with roughly 12 percent in 2001. Part of the problem: many more people today are retiring before they pay off their debt, as compared with prior generations. A recent study by CESI Debt Solutions, a non-profit personal finance firm, found that 56 percent of retirees had outstanding debts when they left the workforce, Yet nearly all among that group refused to delay retirement to pay down those debts. Only 4 percent of respondents said they would pay down debt by cashing in their 401(k) or IRA. Pottow also found that older debtors have 50 percent more credit-card debt than their younger counterparts. And according to the CESI survey, 75 percent of respondents cited medical or funeral expenses as the cause. “Retirement is supposed to be all about enjoying the time you’ve been saving up for,” says Neil Ellington, executive vice president of CESI. “The reality is many people couldn’t save enough.” (Newsweek)
“51 “ - the percentage of Americans who think it’s more likely that scientists will clone dinosaurs in their lifetime than it is that Congress will fix Social Security. (ING)
11 People On A Rope . . . . . . . . Eleven people were hanging on a rope, under a helicopter. 10 men and 1 woman. The rope was not strong enough to carry them all, so they decided that one had to leave, because otherwise they were all going to fall. They weren’t able to choose that person, until the woman gave a very touching speech. She said that she would voluntarily let go of the rope, because, as a woman, she was used to giving up everything for her husband and kids or for men in general, and was used to always making sacrifices with little in return. As soon as she finished her speech, all the men started clapping . . . . . . (Fournier)
529 Accounts . . . . . Here’s an unusual thought: Consider opening a 529 College Saving plan for yourself - separate from what you might already have for your kids’ education. The average worker in the United States retires - or changes careers - several years before the official retirement age, often because he’s been forced to. So you may need to go back to school to update your skills to maintain value in the workforce. Money in a 529 plan grows tax-free if you spend it on qualified expenses, like tuition at just about any post-secondary institution. If you don’t use it yourself, you can always change the beneficiary to a child or grandchild one day. (Money)
Have You Ever Been Guilty . . . . . . . of looking at others your own age and thinking, surely I can’t look that old? Well, you’ll love this one: My name is Alice, and I was sitting in the waiting room for my first appointment with a new dentist. I noticed his DDS Diploma on the wall, which bore his full name. Suddenly, I remembered a tall, handsome, dark-haired boy with the same name had been in my high school class some 30 - odd years ago. Could he be the same guy that I had a secret crush on, way back then? Upon seeing him, however, I quickly discarded any such thought. This balding, gray-haired man with the deeply lined face was way too old to have been my classmate. After he examined my teeth, I asked him if he had attended Morgan Park High School. “Yes, yes I did. I’m a Mustang,” he gleamed with pride. “When did you graduate?” I asked. He answered, “in 1975. Why do you ask?” “You were in my class!” I exclaimed. He looked at me closely. Then, that ugly, old, bald, wrinkled face, fat -a*** , gray-haired decrepit son-of-a-**** asked, “What Did You Teach?” (Novachek)
When You Only Have 8 Seconds . . . . . Go to the following web site if you’d like to see how smart you are: http://www.flashbynight.com/test - Smart or “Stoopid”? Are you smarter or “stoopider” than the average person? Take this short IQ test and find out how you compare....Of course only stupid people would take it as a true indicator of intelligence...and only intelligent people would take it as a true indicator of stupidity. Or Something like that . . . . (L. Smith)
New Regulations . . . . . . The standard mileage allowance for business driving inches up for 2011. The rate increases to 51¢ per mile, up 1¢ from 2010. For medical travel and moving, the allowance is 19¢ per mile, a 2½¢ hike. For charitable driving . . . 14¢. Health Savings Accounts: the maximum contribution is $6,150 for account owners with family medical coverage and as much as $3,050 for single coverage. HSA owners who were born before 1957 can put in an additional $1,000. The minimum deductibles remain at $2,400 for families and $1,200 for individuals. (Kiplinger)
“Management is doing things right; leadership is doing the right thing.” (Peter Drucker)
Management . . . . . . Twelve ways to shock your boss:
1. Show up to work early.
2. Take the initiative to ask questions.
3. Ask for advice, use it, then thank your boss.
4. Speak well of your boss behind his or her back.
5. When necessary, willingly stay late to finish an important project.
6. Do more than your share of the work.
7. Be willing to work odd shifts.
8. Every morning, come prepared to work hard.
9. Continue to grow professionally.
10. Read what you can about your field.
11. Suggest new ideas that will save the company time and money.
12. Stick around - don’t always look for greener pastures. (David Sanford)
2 Catholic Parrots . . . . . . A lady goes to her priest one day and tells him, “Father, I have a problem. I have two female parrots, but they only know how to say one thing.” “What do they say?” the priest inquired. They say, “Hi, we’re hookers! Do you want to have some fun?” “That’s obscene”, exclaimed the priest. Then he thought for a moment, “You know I may have a solution to your problem. I have two male talking parrots, which I have taught to pray and read the Bible. Bring your two parrots over to my house, and we’ll put them in the cage with Francis and Peter. My parrots can teach your parrots to praise and worship. Your parrots are sure to stop saying . . . that phrase in no time!” “Thank you,” said the woman....”this might be the perfect solution.” The next day, she brought her female parrots to the priest’s house. As he ushered her in, she saw that his two male parrots were inside their cage holding rosary beads and praying. Impressed, she walked over and placed her parrots in with them. After a few minutes, the female parrots cried out in unison: “Hi, we’re hookers! Do you want to have some fun?” There was stunned silence. One male parrot looked over at the other male parrot and exclaimed, “Put the beads away, Frank. Our prayers have been answered!” (Founier)
What Purchases Spouses Hide . . . . . Some 80% of husbands and wives spent money over the past year without telling their mates. What they blew the cash on:
• Clothing or Accessories: 25% of males and 43% of females.
• Alcohol: 19% of males and 8% of females.
• Music: 14% of males and 6% of females.
• Gifts: 12% of males and 21% of females.
• Dating Websites: 4% of males and 1% of females. (CESI Debt Solutions)
Crunching The Numbers: . . .
■ Average amount U.S. parents spend to raise a child to 18, excluding college tuition: $286,000.
■ No. 1 complaint about office working conditions: temperature.
■ The average amount a gift-card holder spends beyond the card’s value: $33.
■ The share of retail gift cards never redeemed: 6%.
■ The amount of additional pay a typical 6-foot employee earns
compared with a 5 foot 5 inch co-worker: $5,525. (INC)
Dear Lord: All I want for 2011 is a big fat bank account and a slim body. Please don’t mix these up like last year! (L. Smith)
Sincerely,
Edward C. Levy
President