Work Less, Spend Less: How Retiring Boomers may Impact the Economy

The economy has grown, in large part, because consumers are spending more money. It remains to be seen whether that trend will continue as more of the massive baby boomer generation approaches retirement.

Even before people retire, many tend to slow down their spending habits. Part of this is lifestyle driven; by age 50, most consumers have bought a home, furnished it, sent their kids off to college and are reining in their household budget.1

If this sounds familiar to your situation, it’s a good time to take a look at your retirement income plan. We can create a strategy through the use of insurance products that can help you work toward your retirement income goals, and the sooner you start saving for retirement, the better.  

The highest years for earning often come just before retirement but that’s also the time with the least amount of growth in income. According to studies conducted by the Federal Reserve Bank of New York, young adults see the fastest income increases. Those increases slow mid-career, and by the time we’re in our 50s, our hard-earned salaries could represent negative real wage growth.2

Given little to negligible income increases during the latter stages of a career, it is more likely older workers are saving their money for retirement — not pouring it back into the economy. Recent research revealed that 80 percent of baby boomers are cutting back on how much money they spend. Among them:3

·         54% reduced discretionary expenses

·         47% reduced recurring monthly expenses

·         35% have created and maintain a household budget

The Congressional Budget Office reports that once the majority of baby boomers retire, government spending as a percentage of GDP will likely increase by another 9 percent due to the jump in entitlement benefits.4

Not only will baby boomers likely be spending less as they age, many will continue to work. However, the mix of jobs available to older workers is changing as well. Over the past 26 years, 30 percent of manufacturing jobs have been eliminated, while service-oriented jobs in the education and health care fields have doubled.5

Data from the Bureau of Labor Statistics show the average age of blue-collar workers is climbing upward. The median age for a construction worker was 42.7 in 2016 — just one of the many occupations that would be difficult to continue past a certain age.6

The good news is the health sector is growing, which is good timing as more baby boomers begin seeking personal care aides, registered nurses and home health aides.7

Content prepared by Kara Stefan Communications

1 David Ader. Wealth Management. Feb. 1, 2017. “Will Retired Boomers Kill the Economy?” http://www.wealthmanagement.com/retirement-planning/will-retired-boomers-kill-economy. Accessed Feb. 28, 2017.

2 Robert Rich, Joseph Tracy and Ellen Fu. Federal Reserve Bank of New York. Sept. 28, 2017. “U.S. Real Wage Growth: Slowing Down with Age.” http://libertystreeteconomics.newyorkfed.org/2016/09/us-real-wage-growth-slowing-down-with-age.html. Accessed Feb. 28, 2017.

3 Javier Simon. PlanSponsor. Feb. 27, 2017. “Baby Boomers Adjusted Retirement Expectations Post Recession.” http://plansponsor.com/Baby-Boomers-Adjusted-Retirement-Expectations-Post-Recession/. Accessed Feb. 28, 2017.

4 Knowledge@Wharton. Feb. 23, 2017. “What’s Holding Back U.S. Economic Growth?” http://knowledge.wharton.upenn.edu/article/whats-holding-back-u-s-economic-growth/. Accessed Feb. 28, 2017.

5 Neil Howe. Forbes. Feb. 28, 2017. “The Spread of the Pink-Collar Economy.” https://www.forbes.com/sites/neilhowe/2017/02/28/the-spread-of-the-pink-collar-economy/print/. Accessed Feb. 28, 2017.

6 Ibid.

7 Ibid.

 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

A 100-Year Lifespan: Ways to Help Increase Enjoyment

The average life expectancy of a baby born in the U.S. today is 80 years. However, this prediction assumes prevailing patterns of mortality at the time of birth stay the same throughout a person’s life.1

In reality, patterns of mortality improve over time thanks to discoveries and innovations in nutrition and medical science. If you extrapolate the data to represent the same pace of mortality improvement in the future, people up to age 30 today can reasonably expect to live to an average age of 100.2

However, just as important as how long you live is how well you live. Below are some ideas on steps you can take to help ensure you enjoy your retirement years.  

One way to prepare for an active retirement is to engage in work-life balance early in life. Many people work long hours and don’t take enough vacation time. Over time, this can lead to mental and physical exhaustion. If we don’t take care of ourselves when we’re younger, we have less chance of enjoying a higher quality of life when we’re older.

Or, consider your perspective – are you pursuing your own happiness or trying to find meaning in life? Studies have demonstrated that the pursuit of happiness may not be as good for our well-being as the pursuit of a more meaningful life. In other words, being directed and motivated by valued life goals, which often can take more effort and cause more stress, may be more rewarding. To illustrate, consider the rewards of raising children versus embarking on a series of exotic vacations. Researchers have found that, over the long term, people who pursued more meaning and purpose were more deeply satisfied than those chasing temporary happiness.3

Another study even found a correlation between greater engagement in day-to-day life with a higher degree of financial success, possibly because this type of person tends to place a high value on pursuing long-term goals.4

Exercise is also key. According to the Centers for Disease Control and Prevention, about 32 percent of older adults do not engage in any physical exercise. Understandably, people who don’t prioritize exercise when they’re younger are not likely do so in retirement, so it’s important to make it a habit early on.5

It’s also important to choose activities you can continue as you age. Classes growing in popularity among the over-50 set include dance, strength training, gentle yoga, “gentle stretch,” “Pilates fusion,” ballet barre and tai chi. According to the American College of Sports Medicine, programs for older adults are among the top 20 fitness trends for 2017.6

Retirees may be familiar with the SilverSneakers program, celebrating its 25th anniversary. The program is free for adults over age 65 who are covered by Medicare Advantage, Medicare Supplement and many other plans.7

 In addition to things you should do to enrich a 100-year life, there are things that would make it less enjoyable. One of those things is dementia. While there are many risk factors for dementia, including age, alcohol use, smoking, diabetes, hypertension and genetics, a recent study discovered a few other common triggers that can increase the risk of cognitive decline:8

  • Taking anticholinergic drugs, which includes over-the-counter sleep aids, sedating allergy meds (e.g., Benadryl), sedating pain meds (e.g., Tylenol PM) and prescription meds such as some antidepressants and urinary incontinence treatments. The study also found that once people stop taking these meds, their risk dropped back to normal levels.
  • Lack of vitamin D
  • Heartburn medications with proton pump inhibitors (PPIs) such as Prilosec and Prevacid (complete list here)

We can help you prepare for longer life expectancies by utilizing insurance products within your overall retirement income strategy. Please feel free to contact us to discuss how we can help.

Content prepared by Kara Stefan Communications

1 Peter Vanham. World Economic Forum. Sept. 15, 2016. “You’ll Probably Live to Be 100. Here’s How You Need To Prepare For It.” https://www.weforum.org/agenda/2016/09/you-ll-probably-live-to-be-100-here-s-how-you-need-to-prepare-for-it/. Accessed March 3, 2017.

2 Ibid.

3 Emily Esfahani Smith and Jennifer Aaker. New York Magazine. Dec. 30, 2016. “In 2017, Pursue Meaning Instead of Happiness.” http://nymag.com/scienceofus/2016/12/in-2017-pursue-meaning-instead-of-happiness.html. Accessed March 3, 2017.

4 Drake Baer. New York Magazine. Jan. 4, 2017. “Living with Purpose Yields a Longer Life and Higher Income.” http://nymag.com/scienceofus/2017/01/living-with-purpose-yields-a-longer-life-and-higher-income.html. Accessed March 3, 2017.

5 Lynn Langway. Next Avenue. Jan. 30, 2017. “Boomers Took Fitness and Made It Their Own.” http://www.nextavenue.org/boomers-fitness-trends/. Accessed March 3, 2017.

6 Ibid.

7 Ibid.

8 Beth Levine. Next Avenue. May 25, 2016. “3 Surprising Things That Raise Your Dementia Risk.” http://www.nextavenue.org/3-surprising-things-raise-dementia-risk/. Accessed March 3, 2017.

 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

The Power of Mindfulness

It seems everywhere you turn these days, from news shows to news articles to local advertisements, there’s this idea of promoting “mindfulness” in our day-to-day lives. Mindfulness is generally accepted as focusing one’s mental state on the present moment, being completely aware of all elements around us.

Some financial professionals have expanded this idea of mindfulness to financial management. In an effort to help achieve this, some people practice a no-spending day, no-spending week or no-spending month. By avoiding expenses at all costs, we are forced to assess if and why we need to make certain purchases.1 For example, if you go into a store for one item, you shouldn’t leave with six more. Likewise, you might find you end up consuming all of the canned foods in your pantry before you feel the need to buy more.

Recognizing the difference between wants and needs is probably the biggest benefit to conducting a no-spend day.2 It’s also a good way to allocate your retirement income streams to help ensure your money doesn’t run out. In other words, you could designate steady and reliable income streams (such as Social Security, a pension or an annuity) for necessities such as food and utilities in retirement, while any other variable income can be used to pay for occasional indulgences.

There’s a growing body of research that supports this idea that mindfulness-focused activities, such as meditation and yoga, can help decrease anxiety, depression, stress and pain, as well as help improve general health, mental health and quality of life. In fact, one study concluded that the impact of ongoing mindfulness activities was both significant and long term compared to taking a short-term vacation which, at the outset, was very successful at relieving stress.3

Neuroscience studies also have correlated the impact of aerobic exercise on cognitive clarity. In fact, vigorous exercise has been identified as the only known trigger to create new neurons in the brain. These newly produced neurons appear in parts of the brain associated with learning, memory, concentration and time management.4

When comparing brain scans of young-adult cross-country runners to young adults who don’t engage in regular physical activity, scientists found that overall, the runners demonstrated greater functional connectivity for activities such as planning and decision-making.5

On the surface, it may seem that the older we get, the less sharp our minds become. But alas, there also are studies that demonstrate more mature minds benefit from “crystallized intelligence.” This represents the knowledge and data that we have accumulated over decades of work and life experience. Older workers in particular can counteract age-related cognitive lag by relying on this foundation of experience to troubleshoot problems and innovate new solutions on the job.6

Some educators believe that the medical profession should take this new focus on mindfulness into consideration, not just as a means to help patients cope with health conditions but also to help physicians become better at their jobs.

Doctors are sometimes guilty of taking a set of symptoms at face value and settling on an incorrect diagnosis because they are not tuned in to other symptoms or patient data that may have bearing. Medicine is an inexact science that takes years of experience to become adept at recognizing a wide array of conditions, yet it is equally important not to let that experience and confidence close the mind to other possibilities.

This is where the practice of mindfulness can help physicians become more attuned to each patient’s full array of symptoms and their own biases. To date, some experts believe a missing ingredient in medical education and medical practice are courses or workshops that teach physicians the practice and impact of mindfulness.7 This has become even more critical now that health care delivery has become more of a volume and administrative business with less time spent with patients.

Are you practicing mindfulness in the various areas of your life? Please give us a call if we can help you be more mindful of your current financial situation and long-term retirement income goals.

1 Maggie McGrath. Forbes. March 8, 2016. “Turbo-Charge Your Finances with the Power of Mindful Spending.” http://www.forbes.com/sites/maggiemcgrath/2016/03/08/turbo-charge-your-finances-with-the-power-of-mindful-spending/#2eba22013796. Accessed Feb. 21, 2017.

2 Ibid.

3 Monique Tello. Harvard Health Publications. Oct. 27, 2016. “Regular meditation more beneficial than vacation.” http://www.health.harvard.edu/blog/relaxation-benefits-meditation-stronger-relaxation-benefits-taking-vacation-2016102710532. Accessed Feb. 21, 2017.

4 Melissa Dahl. New York Magazine. April 21, 2016. “How Neuroscientists Explain the Mind-Clearing Magic of Running.” http://nymag.com/scienceofus/2016/04/how-neuroscientists-explain-the-mind-clearing-magic-of-running.html. Accessed Feb. 21, 2017.

5 Alexis Blue. World Economic Forum. Dec. 19, 2016. “Want to give your brain a boost? Running may be the answer.” https://www.weforum.org/agenda/2016/12/running-isnt-just-good-for-your-fitness-it-could-give-your-brain-a-boost. Accessed Feb. 21, 2017.

6 Kim Blanton. Center for Retirement Research at Boston College. Dec. 8, 2016. “Inside the Minds of Older Workers.” http://squaredawayblog.bc.edu/squared-away/inside-the-minds-of-older-workers/. Accessed Feb. 21, 2017.

7 Knowledge@Wharton. Feb. 16, 2017. “How Mindfulness Can Lead to Better Health Care Outcomes.” http://knowledge.wharton.upenn.edu/article/how-mindfulness-can-lead-to-better-health-care-outcomes/. Accessed Feb. 21, 2017.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

 

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

Health Tips from Around the World

These days, it’s difficult to tell if America is still the greatest country in the world or one that has slipped from its pedestal. Perhaps it depends upon the measuring criteria. It is widely documented that the U.S. spends more on health care than any other country, with a total bill of $3.2 trillion last year.1

Despite this tremendous investment in health care, an analysis of 14 developed nations showed life expectancies for people at age 65 are shorter in the United States. American women ranked last in longevity among the 14 developed countries, and men were second to last. Some experts suggest this is due to universal health care and more generous retirement benefits offered in other developed countries.2

Cost, particularly during retirement, may be a factor in how well health is maintained during the later years in life. If you’re considering creating a retirement income strategy that includes planning for potentially increasing health care costs in retirement, we can introduce you to various insurance product options.

While the federal government considers different ways to reform America’s health care delivery and payment system, it’s worth considering what other countries do to produce better results. On an individual basis, we can each learn new ways of managing our own health by considering tips from other countries.

For example, the Dutch are big on bicycling. The average citizen bikes more than 600 miles a year — not just for recreation, but also to and from work. As a result of this constant source of exercise, fewer call in sick to work, and studies show that bikers tend to have more energy and greater power of concentration than non-bikers.3

The Chinese practice Taoism, which involves taking mental and physical timeouts throughout the day to breathe deeply and reflect quietly. This philosophy is one of the basic tenets of today’s cognitive therapy that is used to treat depression, anxiety, stress, trauma and even chronic pain.4

In Finland, one of the national pastimes is relaxing in a sauna, which is believed to boost the immune system and cardiovascular endurance. The country boasts more than one sauna per every five people.5

Chopsticks used in many Asian cultures are known to slow down the pace of eating, which not only helps the body’s digestive system but tends to reduce the amount of food consumed.6

Yoga is a popular activity in India. Studies show that practicing yoga on a regular basis can improve circulation, flexibility, strength, posture and help clear the mind, reduce stress, ease pain and boost immunity. Another positive health influence in India is the use of various spices and herbs, including turmeric, ginger, chili peppers, saffron and cardamom.7

The French are considered somewhat of a mystery for their longevity and relative good health considering their love of wine, cheese and rich sauces. However, experts say they tend to stay slim because they eat small portions over long meals, resist snacking and stop eating when they feel full.8

One author has engaged in a project called Blue Zones, attempting to determine patterns among locales throughout the world that have high concentrations of centenarians, people who live to 100. In general terms, the most common pattern appears to be to “drink coffee for breakfast, tea in the afternoon, wine at 5 p.m.”9

Content prepared by Kara Stefan Communications

1 Carolyn Y. Johnson. The Washington Post. Dec. 27, 2016. “The U.S. spends more on health care than any other country. Here’s what we’re buying.” https://www.washingtonpost.com/news/wonk/wp/2016/12/27/the-u-s-spends-more-on-health-care-than-any-other-country-heres-what-were-buying/?utm_term=.b4bf88dc0213. Accessed Feb. 12, 2017.

2 Financial Planning. Jan. 11, 2017. “How long do U.S. retirees live compared to peers in other countries?” http://www.financial-planning.com/news/how-long-do-us-retirees-live-compared-to-peers-in-other-countries. Accessed Feb. 12, 2017.

3 P. Murali Doraiswamy, M.D.. Thrive Global. Nov. 30, 2016. “7 Well-Being Tips From Around the World… and the Surprising Science Behind Them.” https://journal.thriveglobal.com/7-well-being-tips-from-around-the-world-and-the-surprising-science-behind-them-b06aedeb8ac6#.3fk09m8ew. Accessed Feb. 12, 2017.

4 Ibid.

5 Ibid.

6 Integrative Nutrition. April 7, 2015. “7 Health Tips From Around the World.” http://www.integrativenutrition.com/blog/2015/04/7-health-tips-from-around-the-world. Accessed Feb. 12, 2017.

Jennifer Mulder. The Health Sessions. 2017. “The 8 Best Health Tips From Around the World.” http://thehealthsessions.com/best-health-tips-from-around-the-world/. Accessed Feb. 12, 2017.

8 Naomi Coleman. DailyMail. 2017. “Diet tips from around the world.” http://www.dailymail.co.uk/health/article-64420/Diet-tips-world.html. Accessed Feb. 12, 2017.

9 Eliza Barclay. NPR. Apr. 28, 2016. “Tea Tuesdays: Tea-Drinking Tips For A Longer Life.” http://www.npr.org/sections/thesalt/2015/04/28/400156651/tea-tuesdays-tea-drinking-tips-for-a-longer-life. Accessed Feb. 12, 2017.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

 

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

Medicare Reform Outlook: Uncertain

With a new administration in the nation’s highest office, there is growing debate about Medicare reform.

The federal program, which helps provide health insurance to those over 65 and certain younger people with disabilities, is partially funded by participant premiums and a 1.45 percent payroll tax, matched by employers. Yet, it routinely exceeds its funding sources, according to researcher Philip Moeller.1

Lawmakers, lobbyists and entities have set forth various proposals to modernize Medicare into a program that could essentially pay for itself. One recommendation is a premium support system, in which the federal government would pay a set amount for each Medicare beneficiary toward the purchase of a health insurance plan; this is often referred to as a defined contribution or voucher approach.2

Whether the Medicare program changes, we’re prepared to help you make adjustments to your retirement income strategy to help with future health care expenses; give us a call.

Yet, the outlook on possible Medicare changes is uncertain as different voices compete on how to fix the program. One of the most prominent advocates of Medicare reform, House Speaker Paul Ryan, has set forth a plan that provides premium support, guaranteed coverage options, competitive bidding among plans and higher assistance for seniors with lower incomes or greater health care needs.3

The Committee for Economic Development has proposed similar reform incentives to expand competition among Medicare Advantage plans. Under the committee plan, seniors would receive a geographically benchmarked premium subsidy and pay for the balance of Advantage plans based on the coverage they prefer among a range of competitive options.4

As Congress considers reforming health care for the entire nation, some of the latest proposals include many of the Medicare provisions already in force through the Affordable Care Act. These include preventative screenings for certain conditions and penalizing hospitals for poor-quality care while rewarding providers for care that results in improved health outcomes.5

Despite increasing calls for Medicare reform by the Republican party, the newly installed president campaigned on a platform to leave the program as is.6 Moving forward, whether this issue heats up as a party divider remains to be seen.

Content prepared by Kara Stefan Communications

1 Philip Moeller. PBS. Nov. 16, 2016. “Column: Who’s paying the true cost of Medicare?” http://www.pbs.org/newshour/making-sense/column-whos-paying-the-true-cost-of-medicare/. Accessed Feb. 5, 2017.

2 Gretchen Jacobson and Tricia Neuman. Kaiser Family Foundation. Jul. 19, 2016. “Turning Medicare Into a Premium Support System: Frequently Asked Questions.” http://kff.org/medicare/issue-brief/turning-medicare-into-a-premium-support-system-frequently-asked-questions/. Accessed Feb. 5, 2017.

3 Paul Ryan. PaulRyan.house.gov. Jan. 30, 2017. “Medicare.” http://paulryan.house.gov/issues/issue/?IssueID=9969\. Accessed Feb. 5, 2017.

4 Committee for Economic Development. Oct. 2016. “Modernizing Medicare.” https://www.ced.org/reports/single/modernizing-medicare. Accessed Feb. 5, 2017.

5 Bruce Japsen. Forbes. Jan. 29, 2017. “As GOP Backs Off ACA Repeal, Obama’s Medicare Reforms Remain.” http://www.forbes.com/sites/brucejapsen/2017/01/29/as-gop-backs-off-full-aca-repeal-obamas-medicare-reforms-stand/print/. Accessed Feb. 5, 2017.

6 Eric Pianin. The Fiscal Times. Dec. 4, 2016. “Pence Dampens Ryan’s Call for Major Medicare Overhaul Next Year.” http://www.thefiscaltimes.com/2016/12/04/Pence-Dampens-Ryan-s-Call-Major-Medicare-Overhaul-Next-Year. Accessed Feb. 5, 2017.

We are able to provide you with information but not guidance or advice related to Medicare. Our firm is not affiliated with the U.S. government or any governmental agency.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

 

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

Higher Education Cost Inflation Helps Lead to Legitimizing of MOOCs

Almost 40 percent of high school graduates accepted for college admission ultimately do not attend the following year. The reason? College is expensive: The average college graduate emerged with about $30,000 in student loans in 2015.1

So you’ve got to wonder, is it worth it to graduate with that much debt, especially these days when job security can be a challenge? Parents all over America may ask themselves this question. After all, for decades a college education has been considered the key to getting a good job and pursuing an upper-middle-class lifestyle. But with stagnant wages, many college students may not find jobs that pay enough to cover those student loans while still paving the way for their financial future.

Thankfully, there is a movement to open up access to college education. One online education phenomenon that has exploded in popularity since 2011 is the MOOC, or “massive open online course.” They started out being free, short courses available to anyone with access to the internet. Today, many prestigious universities offer these courses, including Caltech, Harvard, MIT, Stanford, Oxford and the Sorbonne.2

With such widespread, even global, acceptance, many in education are pondering whether MOOCs offer a solution to two common problems with our higher education system: access and cost. Today, 93 percent of the global population lacks the ability to receive a higher education for geographic or economic reasons, and MOOCs can help to avoid conflict with both.3

There are several reasons why college tuition has increased so much. One is that individual states used to cover up to two-thirds of state-funded university budgets. Now they cover only about half, which means parents, students and student loans must cover that deficit. A second reason is that more money is allocated to pay for non-academic staff at colleges and universities; twice as much as in the past. A big part of that represents what many believe to be unreasonably high compensation for top university administrators, especially relative to what professors are paid.4

This may be why MOOCs have become so popular in recent years; there is less administrative and bureaucratic involvement in these courses. Between 2015 and the end of 2016, the number of users who registered for at least one massive open online course grew from 35 million to 58 million worldwide.5 More than 700 universities now offer 6,850 online courses, with business and technology being the most popular subjects. In fact, what started out as a free education movement has now added paid certificate and degree programs. This shift in business model is beginning to redefine MOOCs’ role in the education marketplace.6

Even campus-based colleges have joined the online education bandwagon. Today, most courses comprise online and classroom lectures; face-to-face and Facetime meetings with professors; online interactions with instructors and classmates for study sessions and projects; social media discussions and other web-related activities.7

As for the implications of completing a degree online, what was once a heavy stigma may be changing as more employers get their own experiences with online coursework. In fact, research has found that many online graduates from respected brick-and-mortar universities have the same chances of finding a job, getting a raise or being promoted as students who earned their degree on campus.8

Of course, any education technology, innovation or tool will have its own set of drawbacks and limits. However, it is promising to see universities adjusting the traditional model to help make college more affordable and accessible. Whether your child or grandchild prefers a traditional college education or is open to nontraditional types like MOOCs, we can help you create strategies utilizing insurance products to help put college within financial reach.

Content prepared by Kara Stefan Communications

1 Robert Ubell. IEEE Spectrum. Jan. 23, 2017. “Can MOOCs Cure the Tuition Epidemic?” http://spectrum.ieee.org/tech-talk/at-work/education/can-moocs-cure-the-tuition-epidemic. Accessed Jan. 31, 2017.

2 Rosamond Hutt. We Forum. Dec. 13, 2016. “You can now take a course at the world’s best universities for free.” https://www.weforum.org/agenda/2016/12/you-can-now-take-a-course-at-the-world-s-best-universities-for-free-here-s-how-that-happened. Accessed Jan. 31, 2017.

3 Diane Luckow. Simon Frazier University. Jan. 3, 2017. “SFU MOOC a new route for students.” https://www.sfu.ca/sfunews/stories/2017/sfu-mooc-new-route-for-students.html. Accessed Jan. 31, 2017.

4Robert Ubell. IEEE Spectrum. Jan. 23, 2017. “Can MOOCs Cure the Tuition Epidemic?” http://spectrum.ieee.org/tech-talk/at-work/education/can-moocs-cure-the-tuition-epidemic. Accessed Jan. 31, 2017.

5 Natalie Marsh. The PIE News. Jan. 4, 2017. “MOOC users reach 58 million globally.” https://thepienews.com/news/edu-tech/mooc-users-reach-58-million-globally/. Accessed Jan. 31, 2017.

6 Ibid.

7 Robert Ubell. IEEE Spectrum. Jan. 30, 2017. “What Do Employers Really Think About Online Degrees?” http://spectrum.ieee.org/tech-talk/at-work/education/what-do-employers-really-think-about-online-degrees. Accessed Jan. 31, 2017.

8 Ibid.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

U.S. Housing Market Update

The 30-year fixed mortgage rate rose from 3.5 percent to 4.25 percent after the presidential election. While higher rates might deter potential homebuyers — particularly young first-timers — residential real estate is expected to continue being a seller’s market throughout 2017.1

Meanwhile, the fate of Fannie Mae and Freddie Mac remains unclear. These government-sponsored enterprises have been managed by a federal agency since the housing slump in 2008. Trump’s pick for Treasury secretary, Steven Mnuchin, has indicated that his top priority is to privatize these mortgage giants.2

The real estate market bodes particularly well for retirees who have paid off their mortgage. While many retirees prefer to stay put in their longtime homes, it may be worth considering downsizing to a smaller place that is easier to maintain. Today’s market provides a wide range of potential homebuyers willing to pay top dollar for homes in areas with low inventory.3

Many retirees looking to downsize are in the same boat as other homebuyers: Plenty of motivation but not enough options from which to choose. In this situation, many are considering new construction, including the lower-cost “tiny house” trend.4

Those in the market for a new home can even custom build a smaller home designed to make life easier as they age, featuring no stairs, wide hallways, easily accessed storage areas and some of the new smart-home technological conveniences to help them stay in touch with loved ones.5

For those who haven’t retired, or aren’t prepared to downsize just yet, one possibility may be purchasing a smaller home now and using it for rental income until they’re ready.6

Be sure to consult with a professional real estate agent or broker to help decide what’s best for your unique situation.

Content prepared by Kara Stefan Communications

1 Diana Olick. CNBC. Dec. 13, 2016. “How rising mortgage rates may not matter for housing.” http://www.cnbc.com/2016/12/13/how-rising-rates-may-not-matter-for-housing.html. Accessed Feb. 8, 2017.

2 Holden Lewis. Bankrate.com. 2017. “What’s in store for housing market in 2017?” http://www.bankrate.com/finance/mortgages/housing-trends-1.aspx. Accessed Jan. 24, 2017.

3 Yuqing Pan. Realtor.com. Jan. 16, 2017. “Sold Out: These 10 U.S. Cities Have the Biggest Housing Shortages.” http://www.realtor.com/news/trends/top-10-housing-markets-constrained-by-tight-inventory/. Accessed Jan. 24, 2017.

4 Kiplinger. 2017. “10 Great Tiny Homes for Retirees.” http://www.kiplinger.com/slideshow/retirement/T010-S001-great-tiny-homes-for-retirees/index.html. Accessed Jan. 24, 2017.

5 TD Bank. Realtor.com. Sept. 18, 2015. “Is New Construction for You?” http://www.realtor.com/advice/buy/is-new-construction-for-you/. Accessed Jan. 24, 2017.

6 Bankrate. Aug. 2, 2016. “Funding retirement with rental income.” http://www.bankrate.com/finance/retirement/funding-retirement-with-rental-income-1.aspx. Accessed Feb. 22, 2017.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

AE02175017B