The Allstate Blog » Sue

Thinking About Early Retirement? A Few Things to Consider:

Sue — Thu, 24 Jan 2013 11:57:33 +0000

Early retirement isn’t for everyone. But for those who do dream of it, it’s an idea that sounds very enticing. If you’re thinking that you’d rather not spend your sunset years toiling away at a 9-5 job, you have options. Just don’t give your notice until you’ve considered some of the following factors involved in granting yourself an early release from the workforce.

You can’t begin to claim Social Security benefits until you’re at least 62

This means is that if you decide to retire from your career at the age of 59, you’ll have three potentially long years to wait before you can begin to receive monthly Social Security checks. Unless you’re in line to receive a generous pension from your employer or have a lot of money saved up from years of penny-pinching, coupon-clipping and resisting impulse shopping, you may have no choice but to keep working until you are 62 -- or even older.

If you retire before 66, you won’t get your full social security retirement benefit

In other words, the monthly check you’ll get from the Social Security Administration won’t be as high if you retire before 66 as you’d receive if you wait until reaching the full retirement age, which is determined by the year in which you were born. Although the checks will begin to increase in value the closer you get to 66, it’s an incremental process. For example, if you retire at the age of 62, you’ll only receive 75 percent of the full value of your Social Security earnings. If you retire at 63, that amount rises to 80 percent. At 64, you’ll get about 87 percent, and at 65, around 93 percent. There are plenty of retirement age and income calculators available online, include this one from Allstate Financial, which takes a snapshot of what you have and helps you make the most of it.

Give careful consideration to health care

Medicare doesn’t kick in until you’ve turned 65 – but what are your options if you choose to retire early and are still years away from that age? If your current employer’s pension plan offers medical coverage, this is likely going to be your best option, as long as it’s affordable. But, if health care isn’t offered, or if it’s too expensive or is only offered for a short period of time, that’ll leave you uninsured until you’re eligible for Medicare. You may be eligible to get group health insurance as a paying member of the American Association Retired Persons (AARP). There’s also this: If you’re retiring within 18 months of your 65^th birthday and your employer isn’t offering a retirement health care package, you could always pay for COBRA benefits to bridge the gap to Medicare coverage. Needless to say, this is expensive, but it may be a better option than crossing your fingers and hoping you won’t get sick between now and then.

Keep in mind the reality of inflation

If you decide to retire at the age of 55 and have a nest egg of a $250,000, you may want to consider: How far will that money get you in another 20 years, when inflation has its way with the cost of living, and what’s affordable now may be downright expensive then? As a rule, whenever you’re planning your retirement – early or not – it’s critical that you take into consideration what inflation will do to your savings much further down the line. Check out this inflation calculator from the Bureau of Labor Statistics to get an idea of what you may be looking at and how far your dollar will take you in a couple of decades. Early retirement may be doable, as long as you’re willing to do the math and plan far in advance. Whether you’re 25 or 55, it’s never too early to start planning ahead. The sooner you do, the better chance you’ll have at spending your sunset years enjoying yourself instead of losing sleep over money. Recommended by the Editor:

Adapt Your Home for Elderly Parents with a Home Safety Checklist

Sue — Tue, 22 Jan 2013 12:00:55 +0000

Earlier this year, my 84-year-old mother slipped and fell. Her accidental fall left her with a broken pelvis – and me with the realization that my aging mother could simply no longer care for herself at home. When we made the tough decision for her to move in with my family, I knew that our current home – with its second-floor guest bedroom and narrow stairs – would need to be changed. According to Caregiver.org, about 44 million Americans provide 37 billion hours of unpaid, "informal" care each year for adult family members and friends. While everyone’s situation is different, we all face a shared challenge of adapting our homes for an elderly parent. If you are preparing to care for an elderly parent in your home, you may need to modify your house to meet her mobility needs and to reduce her risk of falling. Consider the following safety checklist to help adapt your home to senior-specific home safety. Main Entrance

Install a threshold ramp and chair railings to make it easier to leave and enter the home.
Repair cracked sidewalks or uneven pavers that pose a tripping hazard.

Bathroom Safety

Install grab-bars by the toilet and in your bathtub or shower.
Add a no-slip rubber mat to the bottom of your bathtub or shower to prevent slipping.
Add a shower chair or bench for enhanced stability and ease of bathing.
Use a nightlight in the bathroom and hallway to illuminate the path from the bedroom to the bathroom at night.

Stair Safety

Reinforce handrails. An adult should be able to securely wrap his or her hands around the entire handrail with ease.
Add a second handrail on the opposite wall, if possible.
Increase lighting on stairs. Use a two-way switch so the light can easily be turned on and off from both upstairs and downstairs.
Remove rugs from the top and bottom of stairs.
If possible, convert a downstairs room into a bedroom to reduce stair use.

Living Space Safety

Remove throw rugs and runners or use double-sided tape and a non-slip backing to securely hold them in place.
Secure extension cords against the baseboards and out of high-traffic areas.
Reduce clutter. Remind children to keep toys and books off the floor.

Kitchen Safety

If your elderly parent will be cooking or preparing meals, place pots and pans at waist level for easy access.
If your elderly parent should not be cooking due to impairment, consider disconnecting the stove when you're not be home to prevent him or her from turning it on.
Place a microwave on the counter (rather than over the stove) to reduce bending and stretching while preparing food.

Caring for an elderly parent at home? Tell us -- how did you prepare your house for your parent’s arrival? Recommended by the Editor:

How to Go to College for Less

Sue — Tue, 15 Jan 2013 12:00:07 +0000

Outside-the-box strategies for saving money on college.

As the mother of two teenagers, news of rapidly increasing college tuition and the threat of high interest rates on student loans have me thinking about how to afford to pay for their education. Juggling the costs of a mortgage, a car payment, the needs of two growing children and various other expenses makes it hard to save for college, too. I don’t want my kids to start their young adult lives with a large burden of debt, and I also don’t want them to have to pay more than they have to as they strive for that all-important university diploma. After doing some research, here are some outside-the-box ideas on how to go to college for less:

Keep an open mind about private vs. state schools

Private schools seem synonymous with expensive tuition, so I thought they may be out of the question – but that’s not necessarily the case. Kevin Campbell, president of College Planning Authority, a college planning company based inTexas, says shying away from private schools because of the sticker price could be a mistake. “If you have a high-performing student who can get into the higher-end schools, they often have excellent financial aid,” he says. “We often send students to private schools for the same or less than a state school.” In comparing financial aid packages, be sure to ask if the aid is renewable or has any grade-point average requirements so you won’t be caught off guard later on. On the other hand, Zac Bissonnette, author of “Debt-Free U: How I Paid for an Outstanding College Education Without Loans, Scholarships, or Mooching off My Parents,” says students are most likely to get merit-based aid at schools where they’re in the top 10 percent of the incoming class, which some students wouldn’t want to attend. “If you get into a school that’s sort of a reach for you academically, you’re not going to get much merit aid,” he says. “For most families, the best thing to do will be to pick an affordable, in-state college.”

Consider studying outside of the United States

As tough as it might be to consider being an ocean away from one of my kids for four years, it could be a good way to reduce college expenses. Since college tuition in this country has risen faster than in other parts of the world, some students now choose to attend college in places likeEngland,ScotlandorCanada. “Particularly for students looking at international business, I think it starts to make a lot of sense,” saysCampbell. But, he adds, it might not be the best option if your student’s chosen career requires professional certification in theUnited States. “For instance, if you’re an engineering student, make sure the licensing agency will accept your education from out of the country.” Plus, if you want to be able to visit often or fly home for Christmas, Bissonnette cautions that travel costs back and forth could also add up quickly while attending school in another country.

Lower your expected family contribution (EFC)

Your EFC is calculated based on your answers to the Free Application for Federal Student Aid, or FAFSA, and deducted from the cost of attendance at a given school. If the COA exceeds your EFC, then your student is considered to have financial need, which could boost eligibility for grants, loans and scholarships. Campbell suggests using an online EFC calculator or working with a college planner who can explain “what assets count against you and which ones don’t.” For instance, investing in a qualified retirement account such as an IRA or 401(k) could lower your EFC, as could having more than one student in college at the same time.

Graduate Early

Spending less time in college can reduce the cost – so it may be worth encouraging your kids to do what they can to earn university credits before they even graduate high school. According to theNationalCenterfor Education Statistics, the median time it took for 2008 bachelor’s degree recipients to graduate was just over four years. Almost a third of first-time bachelor’s degree recipients took 49 to 72 months to complete their degrees, so graduating early (or at least on time) could help save money. “One of the ways to graduate early is to take summer classes through your local community college and transfer those credits,” suggests Bissonnette. Earning Advanced Placement or International Baccalaureate credits during high school can also help, depending on the college’s policies. Taking fewer credits each semester might allow your student to work his or her way through school and spread out the tuition burden, but unless they’re living at home, room and board could still account for a large portion of college costs. So, while heading off to college will undoubtedly come with a large price tag, taking a unique approach to funding your kids’ college education could reduce the debt load they have to pay back once they’ve got their diplomas in hand. Are you planning for your child’s education – or your own? Visit myallstatefinancial.com for information on starting a college savings account.

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Hoarders or Just Messy? Reclaim Your Kid’s Room with These Tips

Sue — Wed, 19 Sep 2012 11:00:07 +0000

Dead spiders. Cicada carcasses. colorful leaves and rocks. My 10-year old nephew’s bedroom is filled with these “treasures” he collects while exploring the woods behind his family’s country home. His closet is stuffed with Matchbox cars, Star Wars action figures, assorted Lego blocks and Harry Potter paraphernalia. Then, there’s his ever-growing collection of Xbox games that threaten to overtake the family media center. On a recent visit, my normally affable nephew had a full-on meltdown when his parents tried to throw away his old Happy Meal toys. Is my nephew a victim of our consumer culture – or should he be staring in his very own episode of “Hoarders: The Elementary School Years”? Children are notoriously messy, and in a culture that increasingly values object accumulation over quality time, it’s no surprise that my nephew’s room looks like a Toys “R” Us exploded. And while my nephew’s room may look like a disaster zone, psychology professor Randy O. Frost says this is not a cause for concern. “Collecting is very important for kids, starting at about age 2, when they learn the meaning of the word 'mine,' up until early teenage years,” says Frost, co-author of “Stuff: Compulsive Hoarding and the Meaning of Things” and a professor at Smith College in Massachusetts. So, if it’s perfectly normal for a kid to have collections – even extensive ones like my nephew’s collection of bug carcasses – is it still possible to achieve order in the chaos? Absolutely, says Leo Babauta, author of the popular Zen Habits blog. According to Babauta, the key is regular de-cluttering, kid-friendly organization bins and constant containment. Follow these five home organization tips to reclaim your child’s room:

Start with a massive purge. Identify the important items and then donate or dispose of the rest. We started with my nephew’s closet, saving the toys he still plays with while thinning down his bug collection. Many older toys were in great condition for donation, while the Happy Meal freebies went straight to the garbage.
Create kid-friendly storage. Containment is vital for clutter management. Bins and cubbies make it easy for kids to toss their toys inside after playtime. Create a bin for sports gear, stuffed animals, Legos, etc. We also created an inbox for my nephew’s school papers.
Clean as you go. Kids are not perfect; they’re naturally messy and enjoy collecting objects. Teaching kids to clean up what they mess up can help control the clutter. If my nephew wants to play Xbox, he needs to first put away his bug collection.
Buy less, enjoy more. As a doting aunt, I bear part of the blame for contributing to my nephew’s toy chaos. Changing a child’s thinking about toys starts by changing our thinking: Focus on quality over quantity, experiences over objects. Rather than showing up with a new Xbox game whenever I visit, now I plan trips to the amusement park, an afternoon baseball game or a hike through the woods. We may come back with a few new bugs, but that’s part of the experience.
Develop clean house habits. Regular de-cluttering is essential to keeping the mess under control. After holidays and birthdays, ask children to identify toys to donate in order to make space for their new gifts. This same rule applies to the adults. Do you have stacks of old magazines sitting in your living room? Gently worn clothes at the back of your closet? Never-used appliances taking up space in the kitchen? Set an example by donating objects with your kids.

What are your home organization tips for children’s rooms? Do you keep a list of all the items in your home? Share your ideas below!

Backyard Safety: Don’t Get Decked

Sue — Tue, 19 Jun 2012 12:06:34 +0000

I don't know about you, but the minute the weather gets above 60 degrees, we open up the back doors and make our deck into a sort of kitchen-backyard mashup. (I know the trendy thing to do is call it an "outdoor room," but that just doesn't have the same ring to it. "Mashup" makes me feel like a cross between Ty Pennington and the teacher from Glee.) (That would be another mashup. You think I'm getting carried away?)

Before you and your family set up camp out back, take a moment -- while you're doing the rest of your post-winter maintenance -- to give your deck the once-over. An outdoor-architecture company called Archadeck has come up with a handy acronym that includes all the safety points you need to think about: BE SAFER. Hey, it's easy to remember, right? So let's break it down:

B: Are the Boards of your deck warped, splintering, or mildewed? Give the surface a good brush-down, sand problem spots, and clean stains as you would if it were an inside floor. Clean between the cracks, too. Because there's no way you can enforce a no-bare-feet policy, no matter how many pairs of Crocs you pile up just outside the kitchen door.

E: Check Every connection in your deck. How does it connect to the house, to the stairs, to itself? Does the railing wobble? Make the rounds with a drill, screwdriver, pliers, and hammer to get all the screws, nuts, and nails in line (now that I think of it, that sounds like how my mom talked about us kids). S: How's the whole Structure looking? Take a step back -- to the other end of the backyard, or as far as you can get -- and assess your deck for any sagging, tilting, or off-kilter leaning. A: How does your deck Attach to the house? When decks do collapse, this point of connection is usually the culprit. So whatever method was used to marry your house and deck together, make sure it's still doing its job. And if it's not, call a contractor, not Dr. Phil. F: Now check out your Foundation. Are any of your Footings sinking into the ground? If so, that is going to affect the whole structure, and you'll want to compensate for that sooner rather than later -- while the problem's small enough that you didn't notice any sagging two letters ago. E: How do people Exit the deck? Check all the points of egress to make sure they're still safe, especially any stairs. You should also make sure you have shatterproof glass next to any spots where people could stumble against your house's windows. If you've been thinking about guard rails, this is a good time to act on that thought. R: Let's talk some more about Railings. Wiggle them (they shouldn't wiggle back), check where the posts meet the deck, and run your hands down the length to check for rust or splinters there, too. And if, over the winter, you found yourself baby-proofing the house, you need to take a moment to do the same for your deck. The slats should be no more than 4 inches apart, and you might consider a deck guard (usually some kind of non-climbable mesh screen). A good handyman should be able to help you with these adjustments, and you can call a contractor if you feel like the repairs will be considerable. Most likely, they'll cost less now than they will in a year, I can tell you that much!