56 THE QUEENS COURIER • SENIOR LIVING • FEBRUARY 21, 2013 FOR BREAKING NEWS VISIT www.queenscourier.com senior living s BOOMERS CONNECT AT RAPID PACE Even though they’re still common, jokes about clueless baby boomers calling their kids to fi gure out how to use technology are starting to feel outdated. While today’s youngest generations are practically born with tablets, smartphones and laptops in their hands, grandparents are also adopting technology at a startling pace. Boomers’ enthusiasm to consume new technology is growing and changing as fast as the fi eld of new products available. In fact, a 2012 Forrester Research technology survey found 78 percent are online, and of those, 54 percent own laptops. Tablet use among boomers is growing too; 11 percent already own one and another 15 percent plan on buying one soon. While the boomers’ generational trait of progressiveness helps to explain this tech rush, more practical reasons demystify it as well. M a n y amo n g the generat ion are at the peak of their earning p o w e r , w i t h more money to spend on technology than other age groups. A 2012 survey by Nielsen showed that within fi ve years, approximately 50 percent of the U.S. population will be 50 or older, and they’ll control 70 percent of disposable income. For this generation, a forward-thinking mindset has always been a common trait, so crossing the digital divide was bound to happen. Despite their proven purchasing power, many advertisers are leaving these consumers in the lurch. Although boomers account for 49 percent of total sales of consumer packaged goods, Nielsen estimates that less than 5 percent of advertising dollars are targeted toward adults ages 35 to 64. Overcoming the learning curve as well as the lack of attention from marketers has shown just how much boomers value the latest technology developments. But for those who don’t yet have their hands on the latest gadgets, organizations like AARP are making it easier for boomers to get connected. For example, members can get discounts of 5 to 12 percent on a range of HP products, 10 percent off Amazon’s Kindle e-readers, including the popular tablet Kindle Fire, and even discounted phone service from Vonage. For more information about discounts available to AARP members, visit www.aarpdiscounts.com. Courtesy BPT Don’t let these myths rain on your retirement party Do you dream of the day you can retire, but aren’t sure how to get there? You’re not alone. Many people fi nd it easier to avoid reality when it comes to planning for retirement. “That can lead to big mistakes in their retirement income planning,” says Zachary Gipson, vice president of retirement and wealth planning at USAA. Here’s a look at fi ve common myths that could derail your expectations for income when you retire. Myth 1: You won’t be around long enough to go through your money The reality: Life expectancies are at record highs in the United States, so it’s important to acknowledge that you or a family member may spend as many years in retirement as you did working. According to a 2010 report by the National Academy of Social Insurance, for a 65-year-old married couple, there’s a 48 percent chance that one spouse will live to age 90. To help stretch your money, consider incorporating immediate and deferred annuities into your planning. Created to provide guaranteed, lifelong income in retirement, they can also offer guaranteed growth while you’re saving for it, Gipson explains. A long retirement extends your exposure to one of fi nancial planning’s most subtle enemies: infl ation. As you invest, it’s important to seek a mix of assets that guard against the declining value of the dollar and that is in line with your risk tolerance and goals. Myth 2: You should get out of stocks when you retire The reality: Stocks can help provide the long-term growth you need to make your assets last longer since your retirement could span several decades. You’ve probably heard you should reduce your investment risk as you age. But with traditional pensions being replaced by 401(k) plans, you’re wholly responsible for making asset allocation decisions. As Gipson puts it, “Everyone now has to be a pension fund manager with their own money, and most people just aren’t equipped to do that.” Gipson agrees with the notion of dampening portfolio risk at retirement, but that doesn’t mean getting rid of stocks entirely. Rather, regularly reviewing, and if necessary, rebalancing your portfolio based on your risk tolerance can lock in gains from strongperforming asset classes and allow you to buy those that underperform at cheaper prices. Myth 3: You can just keep working The reality: Counting on being able to work as long as you want is dangerous, Gipson says. Employers are feeling pressure to cut costs, and with high unemployment, fi nding work is always a challenge. A disability also could force you to stop working prematurely. Many people think they can simply work longer if they don’t have enough money to retire. According to a recent survey by the Employee Benefi t Research Institute, 74percent of workers plan to work at least part time during their retirement years, and Schaffer notes working in retirement has become a necessity for many. Good planning doesn’t rely on good fortune. Rather, your plan should both keep you from having to work the rest of your life and deal with the consequences of unexpected surprises that prevent you from earning a paycheck. Myth 4: An inheritance will bail you out The reality: You may be hoping for an inheritance as a potential retirement boost. But hope is not a strategy, and counting on an inheritance can create big problems if it doesn’t come through. Many people who expect to inherit money never do so, Gipson says. And even for those who do inherit money, it’s often too little or comes too late to make a difference in their retirement planning, he adds. The safer thing to do is to treat an inheritance as an unexpected bonus rather than relying on it. Myth 5: Your taxes will be lower in retirement The reality: Big government defi cits make future tax increases much more likely. Also, taking money out of retirement accounts, such as traditional IRAs and 401(k)s, creates taxable income that can push you into higher tax brackets. One suggestion Gipson offers is to consider converting part of your eligible retirement assets to a Roth IRA. By doing so, you’ll pay taxes now, but you’ll create a tax-free pool of money to tap in retirement. Diversifying with both Roth and traditional IRAs is a possible way to handle future tax uncertainty. Courtesy BPT
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