Retirement insights from a Colorado PERA perspective

A distant view shows a mountainous landscape with sloping peaks, green trees in the foreground, and a cloudy sky above.

A digest of timely information and insight about finance, investing, and retirement.



<a href="https://medium.com/@RosenthalHealth/how-economic-incentives-have-created-our-dysfunctional-us-medical-market-b681c51d6436" target="_blank" rel="noreferrer noopener">How economic incentives have created our dysfunctional medical market</a>|&nbsp;<a href="https://medium.com" target="_blank" rel="noreferrer noopener">Medium</a> There are 10 economic rules that seem to govern the U.S. medical market, and there are real-life examples that show how they come into play. Economic forces and incentives that motivate our health system often lead to medical practices that are not especially good for our health — or our wallets.



<a href="https://www.cbsnews.com/news/american-workers-big-disconnect-about-retirement/" target="_blank" rel="noreferrer noopener">American workers’ big disconnect about retirement</a> |&nbsp;<a href="https://www.cbsnews.com" target="_blank" rel="noreferrer noopener">MoneyWatch</a> “Wishful thinking” could be one way to describe many Americans’ expectations about retirement. When the modest financial resources that most workers have accumulated and the longer lives we’re all living are considered, the math just doesn’t add up to workers’ expectations about when they can retire and what their standard of living in retirement will be.



<a href="https://content.copera.org/retirement-roundup-how-economic-incentives-have-created-our-dysfunctional-medical-market/" target="_blank" rel="noreferrer noopener">Where to retire in Mexico on $20,000</a> |&nbsp;<a href="https://content.copera.org/retirement-roundup-the-confusion-surrounding-retirement-planning/" target="_blank" rel="noreferrer noopener">US News</a> Durango, Mexico, is an amenity-rich city with great infrastructure, a welcoming population and a very affordable real estate market. The low cost of living is complimented by the dollar’s strength versus the Mexican peso. The weather is ideal for many retirees. Skies are clear blue and nights are cool, making for great sleeping. This is a clean city whose well-kept streets are lined by buildings and structures more reminiscent of old&nbsp;<a href="https://www.copera.org/retirement-roundup-how-economic-incentives-have-created-our-dysfunctional-medical-market" target="_blank" rel="noreferrer noopener" class="broken_link">Europe</a>&nbsp;than Latin America.



<a href="https://www.nytimes.com/2018/08/10/business/vanguard-recession-economy.html?emc=edit_th_180812&amp;nl=todaysheadlines&amp;nlid=280288050812" target="_blank" rel="noreferrer noopener">Vanguard warns of worsening odds for the economy and markets</a> |&nbsp;<a href="https://www.nytimes.com" target="_blank" rel="noreferrer noopener">New York Times</a> The chances of a recession by the end of 2020 are mounting and the prospects for the American stock market in the next decade have worsened appreciably. Those are prognoses, not facts. But they’re not just offhand projections, either. They are the sober assessments of Vanguard, the $5 trillion asset management firm. And they suggest that the current good times may amount to a reprieve: an opportunity to make sure that you are prepared for a storm.



<a href="https://www.marketwatch.com/story/heres-why-you-shouldnt-retire-super-early-even-if-you-can-2018-08-30" target="_blank" rel="noreferrer noopener">Here’s why you shouldn’t retire early—even if you can</a> |&nbsp;<a href="https://www.marketwatch.com" target="_blank" rel="noreferrer noopener">MarketWatch</a> The FIRE movement, short for “financial independence, retire early,” is burning up on the internet. Hundreds of anonymous bloggers (they tend not to reveal their identities because they’re still employed and are afraid of losing their jobs) share their goals of leaving their 9-to-5 jobs and write about how they plan to do so. Some choose to give up their careers entirely, while others decide to freelance in the industry they work in or try an entirely new part-time job. But there are financial and emotional consequences of early retirement, from giving up potentially high earnings to living on a shoestring budget and forgoing what can make life enjoyable.



<a href="https://www.cbsnews.com/news/3-steps-toward-fixing-americas-retirement-system/" target="_blank" rel="noreferrer noopener">3 steps toward fixing America’s retirement system</a> |&nbsp;<a href="https://www.cbsnews.com" target="_blank" rel="noreferrer noopener">CBS News</a> The U.S. retirement system clearly has shortcomings that are leading to widespread insecurity among older workers. In recognition of this anxiety, recent meetings in Washington, D.C., focused on <a href="https://www.cbsnews.com/news/social-securitys-funding-challenges-can-be-solved/" target="_blank" rel="noreferrer noopener">much-needed modernization</a>&nbsp;as the Bipartisan Policy Center (BPC) launched its&nbsp;<a href="https://fundingourfuture.us/#s1" target="_blank" rel="noreferrer noopener">Funding Our Future</a>&nbsp;initiative. The initiative focuses on three significant changes that could significantly improve retirement for many U.S. workers: putting Social Security on a sustainable financial path; closing the retirement plan coverage gap; and encouraging employer-sponsored retirement plans to offer lifetime retirement income options.

Retirement Roundup: How economic incentives have created our dysfunctional medical market

A digest of timely information and insight about finance, investing, and retirement.



<a href="https://www.forbes.com/sites/ebauer/2018/07/13/retirement-savings-and-pension-funding-101-some-actuary-splaining/#763497846db4" target="_blank" rel="noreferrer noopener">Retirement savings and pension funding 101 (some actuary-splaining)</a> |&nbsp;<a href="https://www.forbes.com" target="_blank" rel="noreferrer noopener">Forbes</a> How do employers fund and account for pensions?&nbsp; How should workers save for retirement?&nbsp; Revisiting the basics of pension funding methods might provide a different way of thinking about these issues.



<a href="https://www.reuters.com/article/us-column-marksjarvis-healthcare/how-to-shockproof-your-retirement-healthcare-costs-idUSKBN1K119S" target="_blank" rel="noreferrer noopener">How to shockproof your retirement health care costs</a> |&nbsp;<a href="https://www.reuters.com" target="_blank" rel="noreferrer noopener">Reuters</a> In a national survey by Brightwork Partners, four in five baby boomers said they worry but they are too confused to plan for medical costs. Tools are on the way. While most retirement health care research focuses on broad lifetime numbers, like <a href="https://www.azcentral.com/story/money/business/consumers/2018/04/22/health-costs-retirement-5-things-you-should-know/521129002/" target="_blank" rel="noreferrer noopener">Fidelity’s recent estimate</a> that a couple will spend $280,000 on health care costs in retirement, a new study by Mercer Health and Benefits and Vanguard Research broke it down more specifically.



<a href="https://www.healthcaredive.com/news/ma-outperforms-traditional-medicare-for-people-with-chronic-conditions-stu/527532/" target="_blank" rel="noreferrer noopener">Study: MA outperforms Medicare for people with chronic conditions</a> |&nbsp;<a href="https://www.healthcaredive.com" target="_blank" rel="noreferrer noopener">Healthcare Dive</a> Medicare Advantage enrollees with chronic conditions had 23 percent fewer inpatient stays and 33 percent fewer emergency room visits than beneficiaries in traditional fee-for-service Medicare, according to a recent Avalere Health&nbsp;<a href="http://avalere.com/expertise/managed-care/insights/medicare-advantage-achieves-better-health-outcomes-and-lower-utilization-of" target="_blank" rel="noreferrer noopener">study</a>. There were similar results for dual-eligible beneficiaries, among which MA recipients had 33 percent fewer hospitalizations, 42 percent fewer ER visits, and 20 percent lower costs.



<a href="http://www.startribune.com/minnesota-s-pension-changes-not-a-cure-all-moody-s-warns/487616801/" target="_blank" rel="noreferrer noopener">Minnesota’s pension changes “far from a cure-all,” Moody’s warns</a> |&nbsp;<a href="http://www.startribune.com" target="_blank" rel="noreferrer noopener">Star-Tribune</a> Just one month after Gov. Mark Dayton signed a massive overhaul of Minnesota’s pension system into law, the prominent credit rating agency Moody’s warned that the changes are “far from a cure-all.” Moody’s was one of several rating agencies that recently published articles saying the state’s reform, which is expected to stabilize the benefits of 511,000 retirees and public employees, is a step in the right direction. But the agencies warned more work will be needed to handle high pension burdens.



<a href="https://content.copera.org/retirement-roundup-retirement-savings-and-pension-funding-101/" target="_blank" rel="noreferrer noopener">Commentary: Public pension funds must not divest from reality</a> |&nbsp;<a href="https://www.copera.org/federal-legislation-hurt-institutional-investors-main-street-retirees" target="_blank" rel="noreferrer noopener" class="broken_link">Pensions &amp; Investments</a> Pension funds must invest long-term to meet the anticipated needs of retirees. Every dollar counts, and long-term growth is essential, especially because markets do not always go up. Managing other people’s money is not a trivial pursuit — it demands prudence, patience and perception, not political gamesmanship.



<a href="https://www.nytimes.com/2018/07/13/business/in-a-tight-labor-market-retirees-fill-gaps-their-previous-employers-cant.html" target="_blank" rel="noreferrer noopener">In a tight labor market, retirees fill gaps their previous employers can’t</a> |&nbsp;<a href="https://www.nytimes.com/" target="_blank" rel="noreferrer noopener">New York Times</a> At a moment when the unemployment rate is low, hovering around 3.9 percent, some employers are turning to their pool of retirees to fill holes in their staff. As with many of the unretired, the benefits of going back to work are more than financial. Full retirement, after all, isn’t right for everyone. For some seniors, work gives meaning. Losing it can be devastating.

Retirement Roundup: Retirement savings and pension funding 101

A digest of timely information and insight about finance, investing, and retirement.



<a href="https://www.nytimes.com/2018/07/06/business/women-men-longevity-retirement.html" target="_blank" rel="noreferrer noopener">Women outlive men. Why do they retire earlier?</a> |&nbsp;<a href="https://www.nytimes.com" target="_blank" rel="noreferrer noopener">New York Times</a> Based on current life expectancy tables, a typical girl born in the United States today will most likely live until she is almost 87 years old — nearly four years longer than a typical boy born in 2018. But if current trends remain in place, she will probably&nbsp;<a href="https://www.nytimes.com/2017/11/10/business/how-to-win-the-battle-of-the-sexes-over-pay-.html" target="_blank" rel="noreferrer noopener">earn less</a>&nbsp;than he will, thanks in part, to a career that may be delayed or interrupted by bouts of caregiving, including motherhood. That’s what the statistics show.



<a href="https://www.plansponsor.com/case-using-institutional-approach-dc-plan-investments/" target="_blank" rel="noreferrer noopener">The case for using an institutional approach for DC plan investments</a> |&nbsp;<a href="https://www.plansponsor.com/" target="_blank" rel="noreferrer noopener">PlanSponsor</a> A report,&nbsp;<a href="https://www.copera.org/retirement-roundup-women-outlive-men-yet-retire-earlier" target="_blank" rel="noreferrer noopener" class="broken_link">“Defined Contribution Investments on Trial,”</a>&nbsp;from the Institutional Relationship Group at PGIM, the asset management arm of Prudential Financial, notes that recent lawsuits have challenged the investment menu selection approach of many defined contribution (DC) retirement plans. Some plans use what PGIM calls the Retail Approach with a primary focus on appealing to what is believed to be what participants want, using a wide array of choice and an emphasis on name recognition. Others use what PGIM calls the Simple Approach, focusing on minimizing fees and maximizing simplicity, using heavy or exclusive use of passively managed funds and basic asset classes.



<a href="https://www.nytimes.com/2018/06/24/us/politics/medicare-chronic-illness-benefits.html" target="_blank" rel="noreferrer noopener">Medicare allows more benefits for chronically ill, aiming to improve care</a> |&nbsp;<a href="https://www.nytimes.com/" target="_blank" rel="noreferrer noopener">New York Times</a> Congress and the Trump administration are revamping Medicare to provide extra benefits to people with multiple chronic illnesses, a significant departure from the program’s traditional focus that aims to create a new model of care for millions of older Americans. The changes — reflected in a new law and in official guidance from the Department of Health and Human Services — tackle a vexing and costly problem in American health care: how to deal with long-term illnesses that can build on one another, and the social factors outside the reach of traditional medicine that can contribute to them, like nutrition, transportation, and housing.



<a href="https://www.plansponsor.com/firms-offer-framework-planning-retirement-health-costs/" target="_blank" rel="noreferrer noopener">Firms offer framework for planning for retirement costs</a> |&nbsp;<a href="https://www.plansponsor.com" target="_blank" rel="noreferrer noopener">PlanSponsor</a> Vanguard has issued a new framework, jointly developed with Mercer, that helps pre-retirees and retirees better understand the financial planning implications of annual health care costs and long-term care expenses. The research paper,&nbsp;<a href="https://content.copera.org/retirement-roundup-putting-pera-on-a-path-to-prosperity/" target="_blank" rel="noreferrer noopener">“Planning for healthcare costs in retirement,”</a>&nbsp;outlines key health care cost factors and personal considerations, as well as frames health care expenses as an annual cost rather than a lifetime lump sum.



<a href="https://www.forbes.com/sites/andrewbiggs/2018/07/02/the-medias-coverage-of-retirement-saving-really-is-terrible/#5f5f4bcda2e6" target="_blank" rel="noreferrer noopener">The media’s coverage of retirement saving really is terrible</a> |&nbsp;<a href="https://www.forbes.com" target="_blank" rel="noreferrer noopener">Forbes</a> Americans&nbsp;<a href="https://news.gallup.com/poll/233861/update-americans-concerns-retirement-persist.aspx?g_source=link_NEWSV9&amp;g_medium=NEWSFEED&amp;g_campaign=item_&amp;g_content=Update%3a%2520Americans%27%2520Concerns%2520About%2520Retirement%2520Persist" target="_blank" rel="noreferrer noopener">worry&nbsp;</a>about retirement, and understandably so. Not because there’s an&nbsp;actual retirement crisis in the making, but because Americans are everywhere told that there is. A recent lengthy Wall Street Journal&nbsp;<a href="https://www.wsj.com/articles/a-generation-of-americans-is-entering-old-age-the-least-prepared-in-decades-1529676033" target="_blank" rel="noreferrer noopener">treatment</a>&nbsp;of Americans’ retirement savings – titled “A Generation of Americans Is Entering Old Age the Least Prepared in Decades” – is one of the most depressing examples. The Journal’s coverage of Americans’ retirement prospects serves up flawed data tied to touching, but unrepresentative personal case studies, all the while ignoring clear indications that retirement savings and retirement incomes have never been higher.

Retirement Roundup: Women outlive men yet retire earlier

A digest of timely information and insight about finance, investing, and retirement.



<a href="https://hbr.org/2018/03/americans-havent-saved-enough-for-retirement-what-are-we-going-to-do-about-it">Americans haven’t saved enough for retirement. What are we going to do about it?</a>&nbsp;|&nbsp;<a href="https://hbr.org">Harvard Business Review</a> Ultimately, the shift from defined benefit pension plans to employee-directed defined contribution 401(k)s <a href="http://crr.bc.edu/wp-content/uploads/2015/06/wp_2015-17.pdf">is the major driver of the impending retirement crisis</a>. Beginning in the 1980s, this move helped companies reduce their retirement liabilities and better meet their quarterly financial targets, but put an unmanageable burden on employees. For 401(k)s to be effective, for example, contributions must be made consistently throughout a worker’s career. In practice, people tend to make contributions sporadically. They also struggle in choosing contribution levels and investment options, and avoiding the temptation of using their savings for other needs.



<a href="https://content.copera.org/retirement-roundup-what-can-be-done-about-the-impending-retirement-crisis/">Ohio lawmakers kill bill to cut PERS benefits</a> |<a href="http://www.dispatch.com">The Columbus Dispatch </a>Republican House leaders shut down hearings on legislation to reduce benefits for Ohio’s largest public retirement system after running into fierce opposition from retirees. The measure would implement recommendations by the Ohio Public Employees Retirement System – or OPERS – aimed to shore up the $90 billion fund. After a handful of hearings, the bill did not have enough votes to pass. It was opposed by many Republican and Democratic lawmakers, and even the state representative sponsoring the bill was skeptical about the plan.



<a href="https://www.marketwatch.com/story/why-early-retirement-can-be-a-killer-2018-03-19">Why early retirement can be a killer</a> |<a href="https://www.marketwatch.com">MarketWatch</a>Think twice – nay, thrice – before claiming your Social Security benefits at age 62. Your life might depend on your decision. Literally. That’s because there’s a marked increase in mortality among men who retire at 62 and begin receiving Social Security, according to a fascinating new study that recently was distributed by the National Bureau of Economic Research. Its authors are two economics professors: Maria Fitzpatrick of Cornell University and Timothy Moore of the University of Melbourne in Australia. The increase in the death rate is quite large, furthermore, particularly among males who retire and claim Social Security at 62: By 20 percent, according to the study. Among females, in contrast, the data are inconclusive.



<a href="https://www.nytimes.com/2018/03/30/health/unretirement-work-seniors.html">Many Americans try retirement, then change their minds</a> |<a href="https://www.nytimes.com">The New York Times</a> Sue Ellen King had circled her retirement date on the calendar: March 8, 2015. She had worked as a critical care nurse and nursing educator at University of Florida Health (UF Health) in Jacksonville, Fla., for 38 years; co-workers joked that she was there when the hospital’s foundation was laid, which happened to be true. So the send-offs went on for days — parties in the units where she had worked, a dinner in her honor, gifts including a framed photo signed by colleagues. Ms. King felt ready. She’d turned 66, her full Social Security retirement age. She’d invested fully in the hospital’s 401(k) plan and consulted with a financial adviser. She and her husband, who had already retired, had paid off the mortgage on their three-bedroom ranch. They took a week’s trip to Hilton Head, S.C., to celebrate their impending freedom. But her retirement lasted just three months. “I’d done all the preparation, except to really think about what life was going to be like,” Ms. King said. Days spent organizing recipes and photos, and lunching with friends, proved less engaging than expected.



<a href="https://www.ai-cio.com/news/minnesota-senate-unanimously-approves-pension-bill/">Minnesota Senate unanimously approves pension bill</a> |<a href="https://www.ai-cio.com">Chief Investment Officer</a>The Minnesota State Senate has unanimously approved a pension overhaul bill that proposes mandatory contribution increases, reduced cost-of-living adjustments, and a lower investment rate of return for the state’s public retirement plans. Backers of the reform say the proposed bill would save Minnesota $6.1 billion over a 30-year period, $3.4 billion of which will be in immediate savings. They also say that if enacted, the state’s public pension plans’ funded status will be between 85 percent and 95 percent by 2048 from approximately 77.8 percent in 2017. “This is the largest pension reform bill in Minnesota’s history,” said the bill’s author, Sen. Julie Rosen (R), in a statement, adding that it “took years of work and negotiations.”



<a href="https://blogs.wsj.com/economics/2018/04/03/why-women-should-keep-working-after-their-husbands-retire/">Why women should keep working after their husbands retire</a> |<a href="https://blogs.wsj.com/">The Wall Street Journal</a>American women should keep working after their husbands retire if they want to catch up in terms of Social Security benefits, based on new research. Married couples often choose to stop working at the same time, taking advantage of the opportunity to travel or otherwise spend time together. But most married women are younger than their husbands, and some have delayed or interrupted careers due to child-rearing. Waiting longer to retire would bring them disproportionate gains under the formula for calculating Social Security retirement benefits, economist Nicole Maestas said in a recent paper. “If you have had a period out of the labor force, or a period of part-time work, or a period when you were earning much less than you’re earning now….you have an opportunity to replace those zeros with positive numbers that are high,” said Ms. Maestas, an associate professor of health care policy at Harvard Medical School. “I’m not sure people are fully aware of all of that.”

Retirement Roundup: What to do about the ‘impending retirement crisis’

A digest of timely information and insight about finance, investing, and retirement.



<a href="https://content.copera.org/retirement-roundup-interim-ceo-baker-tapped-to-join-institutional-investor-group/" target="_blank" rel="noreferrer noopener">Council of Institutional Investors taps Ash Williams as new chairman</a> |&nbsp;<a href="https://www.copera.org/federal-legislation-hurt-institutional-investors-main-street-retirees" target="_blank" rel="noreferrer noopener" class="broken_link">Pensions &amp; Investments</a>The Council of Institutional Investors on Wednesday announced that Ron Baker, PERA’s Interim Executive Director, has joined their board and Ashbel Williams, executive director and chief investment officer of the $209.7 billion Florida State Board of Administration, Tallahassee, was named chairman. Other new board members for 2018-2019 include Jerry Albright, CIO of the $146 billion Texas Teacher Retirement System, Austin; Renaye Manley, deputy director, strategic initiatives department at the Service Employees International Union; Thomas McIntyre, international representative at the International Union of Bricklayers and Allied Craftworkers; Hope Mehlman, chief governance officer and assistant corporate secretary at Regions Financial Corp.; and Jennifer Peet, corporate governance director for the Oregon State Treasury and the $78.9 billion Oregon Public Employees Retirement Fund, Salem.



<a href="https://www.nytimes.com/2018/03/16/business/fiduciary-rule-retirement-planning.html" target="_blank" rel="noreferrer noopener">Court overturns Obama-era rule on retirement planners</a>&nbsp;|&nbsp;<a href="https://www.nytimes.com" target="_blank" rel="noreferrer noopener">The New York Times</a> A federal appeals court has ruled that the Department of Labor overstepped its authority when it wrote a rule that required financial professionals, including brokers and insurance agents, to put their customers’ financial interests ahead of their own. The United States Court of Appeals for the Fifth Circuit overturned a lower court’s ruling in a 2-to-1 decision siding with the plaintiffs, which include several groups representing the financial services industry. The strongly worded decision is not necessarily the end of the <a href="https://www.copera.org/retirement-roundup-long-1-million-last" target="_blank" rel="noreferrer noopener" class="broken_link">fiduciary rule</a>, lawyers said, but its future is highly uncertain.



<a href="https://www.courier-journal.com/story/news/politics/2018/03/14/stivers-dont-see-lot-hope-pension-bill/424601002/" target="_blank" rel="noreferrer noopener">Kentucky&#8217;s pension reform bill is unlikely to pass</a> |<a href="https://www.courier-journal.com" target="_blank" rel="noreferrer noopener">Louisville Courier-Journal </a>Key Senate Republican leaders acknowledged last Wednesday there is little hope for passage of the pension reform bill during the 2018 General Assembly and began warning of serious ramifications if the bill is not passed. &#8220;I don’t see a lot of hope for it. That’s just the reality,” Senate President Robert Stivers said Wednesday of the status of the pension measure, Senate Bill 1. The Senate president said, &#8220;I am looking at legislation to introduce later on. I do not want to come into a special session, but it may be necessary.&#8221;



<a href="https://www.cnbc.com/2018/03/09/women-fail-to-save-enough-for-retirement-heres-how-to-fix-that.html" target="_blank" rel="noreferrer noopener">Women fail to save enough for retirement. Here&#8217;s how to fix that</a> |<a href="https://www.cnbc.com" target="_blank" rel="noreferrer noopener">CNBC</a>When it comes to saving for retirement, most women aren&#8217;t giving themselves a passing grade. Only 12 percent of working women are &#8220;very confident&#8221; that they will be able to retire comfortably, according to new research from the Transamerica Center for Retirement Studies. Another 46 percent of women are &#8220;not too confident&#8221; or &#8220;not at all confident&#8221; about their retirement, according to the survey. That insecurity highlights the unique challenges women face when it comes to saving for their later years.



<a href="http://time.com/money/5187025/what-retirees-can-learn-from-this-years-oscar-winners/" target="_blank" rel="noreferrer noopener">What retirees can learn from this year&#8217;s Oscar winners</a> |&nbsp;<a href="http://time.com/money/" target="_blank" rel="noreferrer noopener">Time-Money</a>This year’s Oscars delivered a powerful and inspiring message for anyone who’s nearing or is at retirement age: Achievement doesn’t have an expiration date, and success and fulfillment are still possible even as you’re increasingly reeling in the years.



<a href="https://www.marketwatch.com/story/the-irrational-time-people-save-for-retirement-2018-03-19" target="_blank" rel="noreferrer noopener">The irrational thing some people do when they retire</a> |&nbsp;<a href="https://www.marketwatch.com/" target="_blank" rel="noreferrer noopener">MarketWatch</a>The best time to save for retirement is decades before it starts, but some people get into the habit of squirreling away money only after calling it quits. Researchers from Columbia Business School and Copenhagen Business School <a href="http://www.nber.org/papers/w24405" target="_blank" rel="noreferrer noopener">found</a> that after retirement, retirees were more inclined to reduce consumer debt and increase their liquid savings. The data doesn’t give a definitive explanation, but researchers call it the “retirement-consumption puzzle,” suspecting it is a mix of work-related expenses disappearing and more leisure time to spend cooking and looking for better deals.

Retirement Roundup: Interim CEO Baker tapped to join institutional investor group

A digest of timely information and insight about finance, investing, and retirement.



<a href="https://www.theatlantic.com/business/archive/2018/02/pensions-safety-net-california/553970/" target="_blank" rel="noreferrer noopener">This is what life without retirement savings looks like</a> |&nbsp;<a href="https://www.theatlantic.com" target="_blank" rel="noreferrer noopener">The Atlantic</a>Roberta Gordon never thought she’d still be alive at age 76. She definitely didn’t think she’d still be working. But every Saturday, she goes down to the local grocery store and hands out samples, earning $50 a day, because she needs the money. “I’m a working woman again,” she said in the common room of the senior apartment complex where she now lives, here in California’s Inland Empire. Gordon has worked dozens of odd jobs throughout her life—as a house cleaner, a home health aide, a telemarketer, a librarian, a fundraiser—but at many times in her life, she didn’t have a steady job that paid into Social Security. She didn’t receive a pension. And she definitely wasn’t making enough to put aside money for retirement.



<a href="https://www.marketwatch.com/story/a-new-idea-mandatory-retirement-accounts-to-help-workers-delay-claiming-social-security-2018-02-28" target="_blank" rel="noreferrer noopener">A new idea: Mandatory retirement accounts to help workers delay claiming Social Security</a> |<a href="https://www.marketwatch.com" target="_blank" rel="noreferrer noopener">MarketWatch</a>A new proposal would create retirement saving accounts that would enable people to postpone the age at which they claim Social Security, thereby increasing monthly benefits.



<a href="https://www.nytimes.com/2018/03/05/opinion/investor-class-pensions.html" target="_blank" rel="noreferrer noopener">The real reason the investor class hates pensions</a>|<a href="https://www.nytimes.com" target="_blank" rel="noreferrer noopener">The New York Times</a>No issue in America today better illustrates the divergent interests of working Americans and the 1 percent than pension reform. Substantial empirical evidence shows that the 401(k), recently renounced by its own investors, is grossly inadequate and will leave tens of millions of Americans with insufficient retirement assets. And yet states and cities are busy converting traditional pensions into these failing 401(k)s or equivalents, to the great benefit of money managers and the finance class. 401(k) holders let ourselves be charged high fees that we do not understand, we accept poor returns quarter after quarter, we never sue to enforce our rights, we never vote as shareholders and we never tell our investment managers how we think they ought to vote.



<a href="https://content.copera.org/retirement-roundup-what-retirement-looks-like-with-no-savings/" target="_blank" rel="noreferrer noopener">Kentucky pension bill illegal in at least 21 ways, Beshear tells lawmakers</a> |<a href="https://www.copera.org/retirement-roundup-social-security-retirement-age-going-up" target="_blank" rel="noreferrer noopener" class="broken_link">Lexington Herald-Leader</a> In February, Kentucky Attorney General Andy Beshear told state lawmakers that a proposal to overhaul Kentucky’s ailing public pension systems contains “multiple legal violations.” In a six-page legal opinion, Beshear outlined 21 ways he believes proposed legislation violates the “inviolable contract” the state has made with teachers and employees of state and local governments. “It is clear that if you pass [the bill] into law, you should expect numerous lawsuits, which the commonwealth will lose,” Beshear warned lawmakers.



<a href="http://www.governing.com/topics/workforce/gov-pension-reform-new-employees-retirement.html" target="_blank" rel="noreferrer noopener">Retirement experts to new government employees: Think for yourself</a> |<a href="http://www.governing.com" target="_blank" rel="noreferrer noopener">Governing</a>When politicians talk about pensions, it’s usually about the enormous weight they place on government budgets. According to the Volcker Alliance, state and local governments are on the hook for $1 trillion in unfunded pension liabilities. Lawmakers on both sides of the aisle push for pension “reform,” a word often used in a positive sense, to rescue dollars that could instead be used for other services. But what about future retirees? Is pension reform positive for them? In many cases, not so much.



<a href="https://www.copera.org/retirement-roundup-what-retirement-looks-like-with-no-savings" target="_blank" rel="noreferrer noopener" class="broken_link">31 weird things about retiring you probably didn&#8217;t know</a>&nbsp;|&nbsp;<a href="https://content.copera.org/retirement-roundup-what-retirement-looks-like-with-no-savings/" target="_blank" rel="noreferrer noopener">Nasdaq</a> It&#8217;s never too early to start thinking about how you want to spend your time — and your money — in retirement. No matter if you&#8217;re hoping to retire as early as possible or plan to work until you can&#8217;t, having a plan for how you want to spend your senior years helps make sure your dreams come true. Fortunately, there are some weird and interesting facts that could help you make the most out of retirement. Read and see how you can make retirement easy.

Retirement Roundup: What retirement looks like with no savings

A digest of timely information and insight about finance, investing, and retirement.



<a href="https://content.copera.org/retirement-roundup-baker-named-interim-pera-executive-director/" target="_blank" rel="noreferrer noopener">Colorado PERA Board of Trustees Names Interim Executive Director</a> |&nbsp;<a href="https://www.copera.org/" target="_blank" rel="noreferrer noopener">Colorado PERA</a>The Board of Trustees of Colorado PERA named Ron Baker as Interim Executive Director effective December 15, 2017. Mr. Baker joined PERA in 1994 and was appointed to his current position as Chief Administrative Officer in 2013. “I want to thank the Board for their confidence in me–it’s truly humbling to assume this role at this difficult time,” Mr. Baker said. “We will continue to work guided by the example set by Greg in serving the 560,000 current and former Colorado public employees who rely on PERA,” he concluded.



<a href="https://www.plansponsor.com/lack-of-financial-literacy-remains-historic-american-challenge/" target="_blank" rel="noreferrer noopener">Lack of Financial Literacy Remains Historic American Challenge</a> |<a href="https://www.plansponsor.com" target="_blank" rel="noreferrer noopener">PLANSPONSOR</a>A new analysis published by Martha Brown Menard, who conducts financial-services user experience research for Questis, dissects both successful and unsuccessful financial education programs, with an aim at discovering what approaches work best in what circumstances. Setting the stage for her recommendations, Menard suggests financial stress among U.S. employees is reaching “epidemic proportions.” She cites survey data to the effect that 75 percent or more live paycheck to paycheck, personal savings rates are at their lowest since 2007, and <a href="https://www.plansponsor.com/americans-debt-serious-impediment-retirement-savings/" target="_blank" rel="noreferrer noopener">non-mortgage debt levels are higher now than during the Great Recession</a>.



<a href="https://www.marketwatch.com/story/5-ways-the-tax-bill-will-affect-your-retirement-2017-12-20" target="_blank" rel="noreferrer noopener">5 ways the tax bill will affect your retirement</a> |<a href="https://www.marketwatch.com/" target="_blank" rel="noreferrer noopener">MarketWatch</a>The $1.2 trillion tax overhaul that passed on Wednesday will affect your retirement in a number of ways. The tax plan no longer includes lowering contribution limits on retirement accounts or nixing traditional individual retirement accounts in lieu of Roth individual retirement accounts (which would have shifted when retirement savers pay taxes on their savings), but it does address individual retirement accounts and increases the standard deduction (by almost double), which could affect the way people itemize their charitable donations. These changes would be for next year’s taxes, to be filed in 2019 — 2017 tax returns are due on April 17.



<a href="https://www.nytimes.com/2017/12/16/business/asked-about-retiring-they-have-a-simple-answer-why.html?smid=tw-share" target="_blank" rel="noreferrer noopener">Asked About Retiring, They Have a Simple Answer: Why?</a> |<a href="https://www.nytimes.com" target="_blank" rel="noreferrer noopener">The New York Times</a> On most mornings, Jack B. Weinstein rises at 5:30 to exercise. At 7:00, a car takes him from his home in Great Neck to Cadman Plaza in Brooklyn, where he is a senior Federal District Court judge for the Eastern District of New York. Once at the courthouse, Judge Weinstein has coffee and gossips with colleagues. By 9:00, he’s at work hearing motions, reviewing filings and &nbsp;sentencing defendants. In the afternoon, he tries cases. None of that is so unusual. But Judge Weinstein is 96 — decades past the age when most Americans choose to stop working. “Retire? I’ve never thought of retiring,” he declares. Judge Weinstein was first appointed to the bench more than 50 years ago and is still in the thick of hot-button issues in the courts. “I’m a better judge, in some respects, than when I was younger. I don’t remember names. But I listen more. And I’m more compassionate. I see things from more angles. If you are doing interesting work, you want to continue.”



<a href="https://www.marketwatch.com/story/four-ways-to-change-401k-plans-for-the-better-2017-10-25" target="_blank" rel="noreferrer noopener">Four ways to change 401(k) plans for the better</a> |<a href="https://www.marketwatch.com" target="_blank" rel="noreferrer noopener">MarketWatch</a>Over the past few months, 401(k) plans have been in the news a lot. At one point, Republicans floated the idea of drastically lowering the maximum that employees could contribute. And this week, President Trump asked once again how everyone’s 401(k) plans are doing as a result of the rising stock market. But what these plans need even more than a bull market is a way to get more people to participate in them, some experts suggest. Yes — 401(k) account balances and stock market performance are tied to one another, but not everyone has access to these defined contribution plans, and few who do invest in them.



<a href="http://www.houstonchronicle.com/news/politics/houston/article/Lawsuit-claims-Houston-misled-voters-on-1B-12440008.php" target="_blank" rel="noreferrer noopener">Lawsuit claims Houston misled voters on $1B pension bonds</a>&nbsp;|&nbsp;<a href="http://www.houstonchronicle.com" target="_blank" rel="noreferrer noopener">Houston Chronicle</a> Mayor Sylvester Turner misled voters into approving a $1 billion pension bond referendum last month, a new lawsuit alleges, claiming that city officials plan to use the bonds’ passage to sidestep a voter-approved limit on the property tax revenue Houston can collect. Turner’s office flatly denied that reading of the Proposition A ballot language, calling the wording “boilerplate” and saying the city has not and will not sidestep the revenue cap as a result of the vote on the mayor’s landmark pension reform package or any of the prior bond issuances that included the same phrasing. A local businessman and former Houston housing department director, James Noteware, sued the city Friday in state district court, contesting the Nov. 7 election on the grounds that the ballot language was “materially misleading.”

Retirement Roundup: Baker named interim PERA Executive Director

A digest of timely information and insight about finance, investing, and retirement.



<a href="https://www.plansponsor.com/public-pensions-able-pay-promised-benefits/" target="_blank" rel="noreferrer noopener">Public Pensions Have Been Able to Pay Promised Benefits</a> |&nbsp;<a href="https://www.plansponsor.com" target="_blank" rel="noreferrer noopener">PLANSPONSOR</a>Some policymakers want to close participation in a public pension plan to all new hires, cut benefits and increase employee contributions, or convert defined benefit (DB) plan pensions into defined contribution (DC) plans. They usually cite the underfunding of public pension plans as the reason for these ideas. New research shows that funding status has little correlation with a pension fund’s ability to pay its promised benefits. Michael Kahn, director of research for the National Conference on Public Employee Retirement Systems (NCPERS) used data from the annual survey of public pensions by the U.S. Census Bureau for 1993 to 2016 and other data and found that during the last quarter century or so, state and local pension plans have always been able to meet their benefit and other payment obligations.



<a href="http://squaredawayblog.bc.edu/squared-away/retirees-say-ugh-to-medicare-shopping/">Retirees say ‘Ugh’ to Medicare Shopping</a> |<a href="http://squaredawayblog.bc.edu/">Squared Away Blog</a>In terms of popularity, reviewing Medicare plans during the open enrollment period ranks right up there with doing taxes. Retirees on Medicare view healthcare as their most burdensome expense. But they are less likely to comparison shop for Medicare plans than for their groceries and gas, even though plan shopping would probably save more money.



<a href="https://content.copera.org/retirement-roundup-pensions-are-keeping-promises/" target="_blank" rel="noreferrer noopener">Funds fighting effort to add UBIT measure</a> |<a href="https://www.copera.org/federal-legislation-hurt-institutional-investors-main-street-retirees" target="_blank" rel="noreferrer noopener" class="broken_link">Pensions &amp; Investments</a>As Congressional Republicans rush to pass tax reform before 2018, public pension plan officials are determined to see one new idea not make it to the finish line: the House plan for a new tax on unrelated business income from direct investments, such as real estate and private equity. The Internal Revenue Service already applies the unrelated business income tax, known as UBIT, to state colleges and universities. But its longstanding silence on application of that tax to other state entities has led public pension plans to believe it does not apply to them, particularly since their gross income already is excluded under another part of the IRS code. Under the House bill, being exempt under one section of tax code would not spare entities from UBIT on income from direct investments. With no grandfathering period, public pension funds would be facing a whole new world in January if the measure is passed.



<a href="https://www.cnbc.com/2017/11/24/health-care-costs-in-retirement-can-top-275000.html" target="_blank" rel="noreferrer noopener">The $275K retirement expense you can&#8217;t afford to ignore</a> |<a href="https://www.cnbc.com" target="_blank" rel="noreferrer noopener">CNBC</a> Before you retire, give your health-care financial plan a checkup. A healthy 65-year-old couple retiring this year can expect to spend $275,000 to cover health-care costs in retirement, according to Fidelity. Those calculations include premiums, cost-sharing provisions and out-of-pocket costs associated with Medicare parts A, B and D — but don&#8217;t include other health expenses, such as over-the-counter medications, dental services, and long-term care.



<a href="https://www.ai-cio.com/news/survey-shows-geopolitical-risk-tops-pension-asset-managers-concerns/" target="_blank" rel="noreferrer noopener">Survey Shows Geopolitical Risk Tops Pension, Asset Managers’ Concerns</a> |<a href="https://www.ai-cio.com/" target="_blank" rel="noreferrer noopener">Chief Investment Officer</a>Institutional investors see geopolitical stability as the biggest short- to medium-term risk to the global economy, more than inflation, growth rates, and central bank policy combined, according to a report from asset manager PineBridge Investments. In a survey of pensions, consultants, and asset management professionals, PineBridge found that 55 percent of pension professionals, and 54 percent of asset managers, saw geopolitical risk as the biggest threat to the economy. “The results surprised me, as I believe geopolitical risk is currently quite low by recent standards,” said Steve Cook, co-head of emerging markets fixed income at PineBridge Investments, in a <a href="https://www.pinebridge.com/press-releases/pinebridge-investments-survey-shows-geopolitical-risk-tops-pension-professionals-concerns" target="_blank" rel="noreferrer noopener">release</a>. “Presumably, respondents are nervous with regard to Korea, Iran, and other potential flashpoints.”



<a href="https://www.nytimes.com/2017/11/24/your-money/some-women-attain-an-enviable-status-401-k-millionaire.html" target="_blank" rel="noreferrer noopener">Some Women Attain an Enviable Status: 401(k) Millionaire</a>&nbsp;|&nbsp;<a href="https://www.nytimes.com" target="_blank" rel="noreferrer noopener">The New York Times</a> Accumulating $1 million in retirement savings is symbolic, even if it means different things to different people. It represents an aspirational amount of wealth to some, financial security to others or a milestone on the way to greater savings still. Of course, in a nation where 44 percent of the population does not have $400 saved for an emergency expense, reaching $1 million may seem unimaginable. For a small but growing number of working women, however, it has become a reality.

Retirement Roundup: Pensions are keeping promises

A digest of timely information and insight about finance, investing, and retirement.



<a href="http://www.plansponsor.com/Taxpayers-Not-Burdened-by-Public-Pensions/">Taxpayers not burdened by public pensions |&nbsp;</a><a href="http://www.plansponsor.com">PlanSponsor</a>



Taxpayers only contribute about 20 cents on the dollar toward public pensions plan contributions, according to a <a href="http://www.ncpers.org/files/NCPERS%20Research%20Series_2017%20Public%20Pensions%20Are%20A%20Good%20Deal%20for%20Taxpayers_Web.pdf" target="_blank" rel="noreferrer noopener">recent paper</a> by the <a href="http://www.ncpers.org/" target="_blank" rel="noreferrer noopener">National Conference on Public Employee Retirement Systems</a> (NCPERS). And <a href="http://www.nirsonline.org/index.php?option=com_content&amp;task=view&amp;id=945&amp;Itemid=76" target="_blank" rel="noreferrer noopener">research</a> from the <a href="http://www.nirsonline.org" target="_blank" rel="noreferrer noopener">National Institute on Retirement Security</a> (NIRS) indicates that every dollar paid in pension benefits creates $2.21 in economic output.



<a href="http://time.com/money/4902055/retirement-planning-mistakes-fix/">This is what retirees would do differently if they could go back in time |&nbsp;</a><a href="http://www.time.com/money">Time-Money</a>



A little bit of practical advice or a fresh perspective on the retirement savings journey could come from recent and soon-to-be-retirees who shared some of the lessons they learned on their own retirement paths.



<a href="http://www.denverpost.com/2017/08/09/modern-wealth-index-denver-lower-than-national/">Denverites define $2 million as the entryway to wealth, lower than national mark |&nbsp;</a><a href="http://www.denverpost.com">The Denver Post</a>



Being wealthy can mean different things to different people, but for residents of the Mile High City, the threshold is a net worth of $2 million, according to the new <a href="https://content.copera.org/retirement-roundup-pensions-taxpayers/" target="_blank" rel="noreferrer noopener">Modern Wealth Index for Denver</a> from Charles Schwab &amp; Co. Nationally, the “wealthy” mark was $2.4 million and the “financially comfortable” mark was $1.1 million. In metro Denver, financially comfortable was defined as $541,700.



<a href="https://www.nytimes.com/2017/08/09/business/labor-department-fiduciary-rule.html">Labor Dept. seeks delay of consumer protection rule for financial advisors |&nbsp;</a><a href="http://www.nytimes.com">The New York Times</a>



Regulators are seeking to delay the deadline for financial advisors to fully comply with a rule that would require them to act in their customers’ best interest, according to a federal court filing earlier this month. [<a href="https://www.copera.org/retirement-roundup-long-1-million-last" target="_blank" rel="noreferrer noopener" class="broken_link">Read more</a> about the federal rule as it was first introduced in April, 2016.]



<a href="https://www.nytimes.com/2017/08/12/business/why-the-dow-isnt-really-the-stock-market.html">Why the Dow isn’t really the stock market |&nbsp;</a><a href="http://www.nytimes.com">The New York Times</a>



The <a href="https://content.copera.org/retirement-roundup-pensions-taxpayers/" target="_blank" rel="noreferrer noopener">Dow Jones</a> Industrial Average, the oldest and best-known measuring stick for the American stock market, has risen more than 18 percent over the last 12 months, a spectacular return. Meanwhile, the <a href="https://content.copera.org/retirement-roundup-pensions-taxpayers/" target="_blank" rel="noreferrer noopener">Standard &amp; Poor’s 500-stock index</a>, the benchmark for large companies used by many stock professionals, has been far less impressive, with a gain in the last 12 months of a little over 12 percent.&nbsp; To a surprising extent, the divergence depends on just two stocks, Apple and Boeing, and on the ways in which the two indexes are constructed. The Dow is an old and simple index, including only 30 stocks that are weighted by price, meaning that the highest-priced share of a stock – which happens to be <a href="http://www.boeing.com/" target="_blank" rel="noreferrer noopener">Boeing</a> at the moment – has the greatest sway in the index. The S.&amp;P. is known as a “market-weighted index” and is used by professionals much more widely than the Dow.



<a href="http://www.marketwatch.com/story/why-loneliness-is-more-dangerous-than-obesity-2017-08-10">Why loneliness is more dangerous than obesity |&nbsp;</a><a href="http://www.marketwatch.com">MarketWatch</a>



Loneliness is just as much of a public health hazard as obesity, according to research presented at the American Psychological Association annual conference. Research from a large number of studies showed people who had greater social connections had a 50 percent reduced risk of dying early, and social isolation, loneliness or living alone each played a significant role in premature death. Over 42 million Americans over the age of 45 suffer from chronic loneliness, according to the <a href="http://www.aarp.org/research/topics/life/info-2014/loneliness_2010.html" target="_blank" rel="noreferrer noopener">AARP</a>. People that considered themselves lonely were less likely to engage in social activities, such as going to religious services, volunteering or finding a hobby. (The AARP <a href="https://content.copera.org/retirement-roundup-pensions-taxpayers/" target="_blank" rel="noreferrer noopener">promotes group activities</a> for seniors.)

Retirement Roundup: Pensions Benefit Taxpayers

A digest of timely information and insight about finance, investing, and retirement



<a href="https://www.nytimes.com/2017/08/06/health/prescription-drugs-brand-name-generic.html" target="_blank" rel="noreferrer noopener">Take the generic, patients are told. Until they are not.</a>&nbsp;|&nbsp;<a href="http://www.nytimes.com" target="_blank" rel="noreferrer noopener">The New York Times</a>



Standard advice for consumers is to always ask if there is a cheaper generic when prescribed a medicine. But in the upside-down world of prescription drugs, conventional wisdom about how to lower drug costs is often wrong. As pharmaceutical companies squeeze the last profits from products that are facing cheaper generic competition, corporations are cutting deals that give consumers little choice but to buy brand-name drugs – and sometimes pay more at the pharmacy counter than they would for generics.



<a href="https://www.fool.com/retirement/2017/08/02/should-you-pay-off-your-mortgage-or-save-for-retir.aspx" target="_blank" rel="noreferrer noopener">Should you pay down your mortgage or save for retirement?</a>&nbsp;|&nbsp;<a href="http://www.fool.com" target="_blank" rel="noreferrer noopener">The Motley Fool</a>



If you have a little extra cash at the end of each month, it&#8217;s wise to put it toward long-term financial goals. But how do you know which goals should come first? Is it more worthwhile to put your extra money toward your mortgage or your retirement fund? The short answer is that they&#8217;re both good options.



<a href="http://www.plansponsor.com/Millennials-Lack-Confidence-in-Social-Securitys-Future/" target="_blank" rel="noreferrer noopener">Millennials lack confidence in Social Security’s future</a>&nbsp;|&nbsp;<a href="http://www.plansponsor.com" target="_blank" rel="noreferrer noopener">PlanSponsor</a>



A majority of young Americans lack confidence in the future of Social Security, according to the most recent <a href="http://genforwardsurvey.com/about/" target="_blank" rel="noreferrer noopener">GenForward</a> <a href="https://www.copera.org/retirement-roundup-prescription-drug" class="broken_link">study</a> from the University of Chicago. The sentiment was strongest among African Americans and Latinos. Yet, despite their pessimism, Social Security remains a portion of millennials’ plans for living in retirement.



<a href="https://www.nytimes.com/2017/07/28/business/treasury-retirement-myra-obama.html?" target="_blank" rel="noreferrer noopener">Treasury ends Obama-era retirement savings plan</a>&nbsp;|&nbsp;<a href="http://www.nytimes.com" target="_blank" rel="noreferrer noopener">The New York Times</a>



An Obama-era program that created savings accounts to help more people put away money for retirement is being shut down by the Treasury Department, which deemed the program too expensive. The 30,000 participants in the program, known as myRA and intended for people who did not have access to workplace savings plans, were informed that they could roll the money into a <a href="https://www.irs.gov/retirement-plans/individual-retirement-arrangements-iras-1" target="_blank" rel="noreferrer noopener">Roth</a> individual retirement account.



<a href="http://khn.org/news/many-still-sidestep-end-of-life-care-planning-study-finds/" target="_blank" rel="noreferrer noopener">Many still sidestep end-of-life care planning, study finds</a>&nbsp;|&nbsp;<a href="http://www.khn.org" target="_blank" rel="noreferrer noopener">Kaiser Health News</a>



Even though advance directives have been promoted for nearly 50 years, only about a third of U.S. adults have them, according to a recent study.



<a href="http://www.cbsnews.com/news/what-you-should-know-about-retiring-in-a-foreign-country/" target="_blank" rel="noreferrer noopener">What you should know about retiring in a foreign country</a>&nbsp;|&nbsp;<a href="http://www.cbsnews.com/moneywatch/" target="_blank" rel="noreferrer noopener">CBS Money Watch</a>



More people are choosing to spend their retirement years abroad, with over half a million Americans collecting their Social Security benefits in different countries around the world. But choosing to retire abroad shouldn’t be undertaken lightly. There are a number of things to take into account, from the cost of living and fluctuating exchange rates to health care access and even the ability to receive benefit payments using a foreign banking system.

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