How to Maximize Your Social Security

Suppose you’re having sex with your husband, and he happens to die, umm, sometime during the encounter. Suppose you’ve been married less than nine months – and Social Security benefits are denied thanks to some obscure nine-month rule. Well, somewhere within all the 2,728 rules is an exception applicable when death happens due to extreme exertion. The particular lady in question eventually collected benefits.

Paul Solman.wiki
Paul Solman (Wikipedia photo)

These are the sorts of stories Paul Solman weaves into discussions of his recent book (with Laurence Kotlikoff and Philip Moeller,) Get What’s Yours: The Secrets to Maxing Out Your Social Security. He wants you to catch the part about there being 2,728 rules – in case you don’t really want to read the 3,000+ pages of the document yourself. The mind can boggle at the sheer numbers. In fact, though, the rules are there to help us all, even newlyweds whose newlies do not long survive the wed. The complexity of our financial lives may be bewildering, but Solman observes, “America’s great strength is in its    complexity.”

Solman simply wants you to Get What’s Yours.

The long-time business and economic correspondent for PBS NewsHour spoke recently about his book at the Commonwealth Club of California, an event moderated by KGO TV Consumer Reporter Michael Finney. His basic message to those of us less left-brained (although Solman’s left brain clearly enjoys its coexistence with an entertainingly creative right brain) is summed up in three points:

1 – Be patient.

2 – Be aware of, and know how to maximize, over a dozen different benefits. (What you can afford, how many dependents you must consider….)

3 – Stagger your benefits.

You’re planning to retire on Social Security? Not, says Solman. “Social Security is not a retirement policy. It is an insurance policy.” But it can indeed make your retirement easier, and could be a major piece of your long-term financial plan. Solman said in an aside that he thinks most financial planners are suspect and people should be careful in choosing. “What financial planner ever advised buying TIPS (Treasury Inflation-Protected Securities,)” he asks.

Fran & Paul Solman.2
Solman off-duty, teaching a few Tai Chi moves to the writer

Three audience members already drawing Social Security each estimated his or her current payments would be at least double, if they had known earlier what they have learned from Get What’s Yours. So is the book cheating? “No,” Solman says emphatically, “you follow the rules. It’s not cheating, it’s what the law says you can do.”

One thing anyone considering eventually taking Social Security benefits can do could be to check out a copy of Get What’s Yours. Unless you’d rather study those 2,728 rules and try to figure them out for yourself.

Moving in with mom and dad

Waiting lines at the bathroom? Overflow in the kitchen cabinets? Welcome to the suddenly multi-generational family home.

Yesterday a friend of mine was alternately laughing and crying (I mean, literally) over the tales of her once comfortable, now overstuffed home. Her daughter and son-in-law, both unemployed for an extended time and overwhelmed by mounting debt and loss of health insurance, recently moved in with the older generation. With them came three grandchildren, ages 3, 8 and 11. It could make a great sitcom pilot. “My husband was so desperate to get into one of our two and a half bathrooms the other day,” she said, “that he suggested getting one of those take-a-number things they have in hospital waiting areas. The kids put labels on their snack bar boxes, but now I can’t even find which shelf the boxes got stuffed into or what they’re hiding behind.”

Welcome to the brave new world of extended-family housing.

The extended family is making something of a comeback, thanks to delayed marriage, immigration and recession-induced job losses and foreclosures that have forced people to double-up under one roof, an analysis of Census Bureau figures has found.

“The Waltons are back,” said Paul Taylor, executive vice president of the Pew Research Center, which conducted the analysis.

Multigenerational families, which accounted for 25 percent of the population in 1940 but only 12 percent by 1980, inched up to 16 percent in 2008, according to the analysis.

For the rapidly growing 65+ segment of the population, there’s good news and bad news in this. Loneliness is often cited as a great fear among the aged. At talks and workshops this writer often does on end-of-life issues (advance directives, end-of-life choices, etc.) the response to any “What do you fear most?” question is never “death,” almost always “pain,” “isolation” or “loneliness.” When younger generations move in, loneliness is unlikely, but other problems may well take its place.

The analysis also found that the proportion of people 65 and older who live alone, which had been rising steeply for nearly a century — from 6 percent in 1900 to 29 percent in 1990 — declined slightly, to 27 percent.

At the same time, the share of older people living in multigenerational families, which plummeted to 17 percent in 1980 from 57 percent in 1900, rose to 20 percent.

While the pre-World War II extended family may have been idealized as a nurturing cocoon, the latest manifestation is too recent and a result of too many factors, positive and negative, to be romanticized.

“It calls to mind one of the famous lines in American poetry, from Robert Frost: ‘Home is the place where, when you have to go there, they have to take you in,’ ” Mr. Taylor said. “I don’t know that I can offer a value judgment of whether it’s good or bad. It reflects our time.”

The decline of extended families coincided with an exodus to the suburbs, where many young adults preferred to raise their children, and the enactment of Social Security and Medicare, which made older adults more financially independent.

A lot of factors combine to create the more than 49 million adults currently living in multi-generational homes, the census figures show. We’re living longer, getting married later, getting divorced more often, losing jobs and losing homes. One ray of good news is that the homes now housing multiple generations tend to be larger than a generation ago. Two and a half bathrooms for three generations still beats the olden days of one bathroom for a family of five. But not many families get along as well as the Waltons did. “We love the kids and the grandchidren,” remarked my stressed-out friend mentioned above, “but my son-in-law’s first paycheck is going to go for the down payment on a new apartment.”

Households With Extended Families Are on the Rise, Census Shows – NYTimes.com.

Democrats have a survey too — they just don't call it a Census

In the interest of fair-and-balanced commentary in this space, we want to report receipt of an Official Document from the Democrats. This one, unlike that decidedly suspect missile from the Republicans last week, does not advertise itself as an Official Census Document and does not raise the fear level to code red. It advertises itself as a 2010 Priority Issues Survey, which, in fact, it is.

The envelope, though, does bear the admonition: Do Not Tamper. We wonder who’s been tampering with Democratic issues, other than the hapless invaders of Louisiana Senator Mary Landrieu’s office. We’re not even sure how one can Tamper with an Official Document.

Nevertheless. Because the Democratic Party Headquarters bothered to send a fairly straightforward questionnaire, with a minimum of weighted sentences, below are listed a few considered responses to this “opportunity to help shape Democratic priorities and build a brighter future for America.” You are invited to send your own answers to www.dccc.org, even if you lack an Official Survey Registration number, and we’ll see who’s paying attention. One citizen’s response:

Yes, I believe waterboarding is torture and the U.S. has a moral responsibility to not engage in or condone any form of torture.

Yes, every American should be guaranteed access to affordable, quality health care.

No, I don’t support privatization of Social Security, but Yes, the Medicare prescription benefit plan should be reformed so the government can negotiate lower drug prices with big pharmaceutical companies. (Good luck with that, government.)

Yes, the federal government would do well to provide more assistance to Americans who want to continue their education beyond high school. Cutting student loan interest rates, increasing college tuition tax deductions, increasing Pell grants – all sound good to me.

Weighted question next: How concerned are you about the environmental damage resulting from last-minute Bush Administration maneuvers to weaken laws like the Clean Air Act, Clean Water Act and Endangered Species Act. Well, since I happen to agree, pretty darned concerned.

Slightly different phraseology question: How serious a threat is global warming? Thanks for not asking, as the Republicans did, if I believe it’s real. I’ll go with Very Serious.

That’s about it for the Democrats. They do also provide a postage-paid envelope, and they also invite your contribution.

If the Independents have an Official Survey going, it will be duly reported in this space.

Finances after 50: Have we learned anything from the Great Recession?

Too soon poor, too late smart? A story by WSJ staff reporter Glenn Ruffenach in the November 14/15 Wall Street Journal “Encore” section  asks if we’ve learned any lessons from the financial crisis. And just in case you’re feeling smug about having done so, a quiz inside may shine a sober light of reality. It also contains a lot of data you will find useful, interesting and possibly surprising.

Amid the tumult of the past year, financial advisers are telling us that the Great Recession has produced one invaluable benefit: an education.

We now know, for instance, that our nest eggs can lose almost half their value in a matter of months; that “diversifying” our holdings doesn’t necessarily safeguard those holdings; and that our homes—our one investment for later life that was supposed to be foolproof—can make us look like, well, fools.

How much have you taken away from the events of the past year? Try our quiz and find out.

OK, so it isn’t much of a silver lining. But even worse is that we’ve supposedly learned these lessons before—after each recession, sell-off and market bubble since the 1960s. And yet, we continue to make the same mistakes.

How much have you learned about retirement finances in the past year? And has it sunk in this time? Our quiz will offer you a chance to see if you know where you stand—and provide some guidance for the future.

You’ll have to pick up the Weekend Journal for the quiz, but here’s one freebie in advance:

Q – In retirement, Social Security will likely replace what percentage of your pre-retirement income: (a) 23%; (b) 33%; (c) 43%; (d) 53%.

A – Well, don’t guess high.

Or:

Q – The single best cure for a battered nest egg is: (a) invest more aggressively; (b) save more money; (c) Work longer; (d) Plan to withdraw less money from retirement savings

A – And just when that pile of books to read is so inviting… sorry. (c)

The quiz is full of useful data and interesting insight (fully 40% of men and 41% of women ages 40-50 are considered obese by the Centers for Disease Control & Prevention, for instance; you knew?) One overall message seems to be, in fact: If you have one, don’t quit your day job.

Boomers & the high cost of dying

As health reform slogs along, a few critical pieces are already gone for good — or for now, at least. One of the saddest is coverage for end-of-life conversations; one of the saddest elements of our culture in general and healthcare mish-mash in particular is the tendency to treat death as a curable disease. Timothy Egan, in a recent blog for the New York Times, makes an eloquent case for injecting a little reality into all this.

In the last days of her life, Annabel Kitzhaber had a decision to make: she could be the tissue-skinned woman in the hospital with the tubes and the needles, the meds and smells and the squawk of television. Or she could go home and finish the love story with the man she’d been married to for 65 years.

Her husband was a soldier who had fought through Europe with Patton’s army. And as he aged, his son would call him on D-Day and thank him – for saving the world from the Nazis, for bequeathing his generation with a relatively easy time.

That son, John Kitzhaber, knew exactly what his mother’s decision meant. He was not only a governor, a Democrat who served two terms in Oregon as it tried to show the world that a state could give health care to most of its citizens, but a doctor himself.

At age 88, with a weak heart, and tests that showed she most likely had cancer, Annabel chose to go home, walking away from the medical-industrial complex.

“The whole focus had been centered on her illness and her aging,” said Kitzhaber. “But both she and my father let go that part of their lives that they could not control and instead began to focus on what they could control: the joys and blessings of their marriage.”

She died at home, four months after the decision, surrounded by those she loved. Her husband died eight months later.

The story of Annabel and Albert Kitzhaber is no more remarkable than a grove of ancient maple trees blushing gold in the early autumn, a moment in a life cycle. But for reasons both cynical and clinical, the American political debate on health care treats end-of-life care like a contagion — an unspeakable one at that.

Kitzhaber, having seen the absurdities of the system — Medicare would pay hundreds of thousands for continuing treatments but not $18 an hour for an in-home caregiver to help her die as she chose — was among the thousands of us who were distressed to see the debate get sidetracked by misinformation and outright lies. He knows the truth: that changing the way we treat dying people is the only way real economies and compassionate reform will happen. He is not only a politician, currently running for a third term as governor of Oregon, the state that has shown us the way, but a physician. And he’s smack in the middle of the Baby Boomer generation. Egan cites the recent Newsweek cover article by Evan Thomas, “The Case for Killing Granny,” and its on-target line about this being the elephant in the room, “Everybody sees it, but nobody wants to talk about it.

John Kitzhaber, M.D., politician, and son who watched both parents die in a dignified way, cannot stop talking about it. His parents’ generation won the war, built the interstate highway system, cured polio, eradicated smallpox and created the two greatest social programs of the 20th century — Social Security and Medicare.

Now the baton has been passed to the Baby Boomers. But the hour is late, Kitzhaber says, with no answer to a pressing generational question: “What is our legacy?”

The Way We Die Now – Timothy Egan Blog – NYTimes.com.

Health Reform Geezer Gap

At least one more old geezer — we are legion — is fed up with the Medicare generation getting all the blame for opposing health reform. James Ridgeway writes in his Unsilent Generation blog today that

This health reform debate is about substituting a phony intergenerational war for what ought to be class war – pitting the old against the young, instead of pitting the rich against the poor, or the corporations against the little guy. There WILL be cuts to Medicare, and everyone says this has to happen to keep Medicare from going bankrupt before younger people get to use it. But in fact, if pols were willing to cut the profits of insurance and drug companies, there would be enough for everyone–we could have Medicare for all.

Which does certainly cut to the chase. Ridgeway cites his own earlier writing that applied Dean Baker’s chutzpah definition to today’s economy.

The classic definition of “chutzpah” is the kid who kills both of his parents and then begs for mercy because he is an orphan. The Wall Street crew are out to top this. After wrecking the economy with their convoluted finances, and tapping the US Treasury for trillions in bail-out bucks, they now want to cut Social Security and Medicare because we don’t have the money.

I am still with President Obama on paying for reform through elimination of waste and fraud, though that’s obviously not going to happen overnight and not going to pay for it all by a long shot. But Medicare’s going to survive, as will most Medicare recipients although we are all terminal. The moments of truth will come when the bargaining is over and we learn what the trade-offs really cost. That is, whether Big Pharma and insurance industry negotiations trump the public option, and other details still near and dear to many hearts.

So many trillions, so many sectors looking to save their own skins — or their own trillions, as the case may be — can boggle the mind quickly enough to send Jane Q. Public desperately in search of simplification, and blaming a generation is easy. The Medicares don’t want to lose their benefits, the Boomers worry that there won’t be enough for them (a legitimate worry, in fact) and the people who need health care get lost in the shuffle. Ridgeway fills in a lot of blanks. Check it out.