Abundant Spirit | Spring 2012 1

Winter 2012 Edition

BUNDANT SPIRITLiving • Loving • Laughing • Celebrating A Secure Retirement

Americans RetirementConfidence Down but You Can Still Plan

There have been several recent studies to measure Americans’ confidence in their ability to sustain a secure retirement. The studies approach this subject from differing angles but the results are the same – Americans Retirement Confidence is Down Significantly.

We have learned that the changing financial needs of baby boomers, their adult children and their parents have altered their relationship with money and with each other.

A recent report reveals that about half (49%) of baby boomers stated that they are optimistic about the financial future of the United States, but this is down from two-thirds (64%) of those surveyed for an earlier study published in 2007. Only 17% of baby boomers said they were “very optimistic” about their financial future— a significant decline from 2007 when 39% reported the same. The survey shows that over 80% of people today are concerned about having enough money to retire and continue their lifestyle. This number is up from 71% from those surveyed in 2007.

Add to this declining confidence expanded concerns over the increasing health care costs. Long term care is becoming more expensive every year. For example in 2011, a private room in a long term care facility for one year would cost $85,775.00. If we do a projection to the growth of cost, at a low rate of 3.5%, the cost in 5 years jumps to $100,786.00 per year.

Gas prices have risen dramatically in the last three years. For example in 2009 gas cost an average of $1.85 per gallon, now that average is over $3.87 per gallon. Over the past decade, the annual cost of family coverage has risen 131% and the annual cost for single coverage is up Continues On Page 4

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With life expectancies on the rise, many people can now expect to live 20 to 30 years in retirement. It is now time for you to pursue your dreams and accomplish your long standing goals. But you also need to have a plan in

place for the unexpected. None of us know what the future holds, but what we do know is that life can be unpredictable, so it is better to be prepared just in case.

Many older adults may find it uncomfortable to have their children involved and informed about their personal finances. That’s definitely understandable but this is an important piece of planning for the future. Communicating with the trusted family members or persons can help reassure that your health care and financial wishes are fulfilled correctly. It will also lift the burden and pressure that comes from the unexpected emergency that could force another to make these decisions for you.

This can be a broad overview of your wishes about your health and financial concerns; this does not need to be detailed information about your facts and figures.

Here are some areas you might want to consider reviewing with those whom you trust to ensure your wishes are fulfilled:• Will – a prepared will allows you to

avoid leaving the disposition of your estate up to the state and its probate laws. Make sure that you review your written will often to make the necessary changes and updates as circumstances change. The specific content of the will does not need to be disclosed to your children or trusted family member but the location of the will is critical.

• Trusts – A Trust will help to protect your estate from unnecessary taxation and even mismanagement of funds. The same applies as mentioned above, the specific details do not need to be reviewed. However the trustee should know where the documents are and possibly even talk over some of the information with you.

• Living Will – This is the document that specifies your preference regarding the administering or withholding of life-sustaining medical treatment. Be sure to provide copies of these documents to anyone whom you have deemed to be involved in making decisions regarding your health care in the event that you cannot.

• Assets and Debts – Compile a list of your assets and debts and share them with your children or the person you have determined will be responsible to make decisions for you. This list should be detailed and complete to ensure your finances are taken care of the way you wish.

Planning for the worst case scenario is not pleasant but it can help you and your loved ones through unforeseen tragedy. Initially this type of planning may feel uncomfortable but with the help of a skilled financial professional you will see this daunting task quickly fall into place. Once completed you will be able to rest assured that you did all that was necessary to make sure your wishes will be implemented. For more information on what is involved in this process, or how to start organizing yourself and your finances, contact your financial professional today.

What Should Your Children Know AboutYour Finances?

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We all know the feeling, the sea of paperwork that seems to plague us all, it just builds and builds into a huge mound. Then the inevitable question comes, “What should I do with all this paperwork”?

The answer is knowing when to shred and when to stash your paper.

WHAT TO TOSS AND WHEN • Bank Statements: 1 year • Credit Card Bills: Shred after payment, unless needed for taxes• Non Insurance Related Accounts: if these are TAXABLE accounts, you

should keep annual statements until the sale of each asset within the account

• Retirement Accounts - 401(k), 403 (b), 457, IRA, Roth): Shred as they change or you acquire a new one

• Tax Returns & Supporting Documents: Keep for 7 years

KEEP FOR AS LONG AS YOU OWN THE FOLLOWING ASSETS:

• Appliance Warranties• Vehicle Titles• Vehicle Loan Documents• Auto Insurance Policy• Home Purchase Documents • Homeowners Insurance Policy• Disability Insurance Policies (as long as in-force)

KEEP FOREVER • Copies of wills, trusts, health care proxies/living wills and powers of

attorney (attorney/executor should have copies)• Pension plan documents• Life Insurance policies• Birth/Death certificates & Social Security cards• Marriage Licenses and Divorce Decrees• Safe-deposit box inventory

Lastly another good reason to save certain documents is so you will have them available when you meet with your financial professional for your yearly review. This is a perfect opportunity for you to go over any financial details that may have changed over the year.

Financial DataWhat to Shred and What to Save Nursing Home Costs

Individual Out-of-PocketMedicareMedigapMedicaid/Medi-CalManaged Care (HMO)Long Term Care InsuranceVeterans Benefits

In-Home Health Care Services (Skilled)Individual Out-of-PocketMedicareMedigapMedicaid/Medi-CalManaged Care (HMO)Medicaid/Medi-CalLong-Term Care InsuranceVeterans Benefits

In-Home Care Services (Custodial)Private Out-of-PocketMedigapLong-TermCare Insurance

Assisted Living Facility CostsPrivate Out-of-PocketLong-Term Care InsuranceVeterans Benefits

Nursing Home CostsPrivate Out-of-PocketMedicareMedigapMedicaid/Medi-CalManaged Care (HMO)Long Term Care InsuranceVeterans Benefits

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BUNDANT SPIRITLiving • Loving • Laughing • Celebrating A Secure Retirement

120%, according to Kaiser. In each of the past 10 years, health insurance premium increases have outpaced inflation -- sometimes by as much as 11 percentage points.

So how do we get a handle on these areas of finance that directly impact our lives and security in retirement? Plan. I have a friend who always used to tell me that “Failing to plan is planning to fail”. Now more than ever we need to be proactive with our finances. We need to become educated consumers and we need to get ahead, at least as much as possible, of this run-away train of the rising costs of living.

Here is the good news, with the help of a skilled financial professional you can get ahead and you can plan and you can find ways to meet your rising retirement living needs. Today’s insurance market offers many options for planning for retirement, the preservation of assets and the transfer of your wealth. Take the time today to meet with a financial profession of your choice and take the time to plan how you will spend and preserve your money. Plan for success.

6 Mini-Meals or 3 Square Meals: Which is Better?

Grazing, or breaking up your daily calories into five or six small meals throughout the day, has some advantages over sitting down to the traditional three square meals.

Think about when you are not feeling well, it could be either from a simple sore throat or cold to a complex chemotherapy treatment. Often it can be hard to eat anything more than a small meal, if even that. Thus mini-meals, spaced just a few hours apart, can help keep boost your energy and body up during those times when you would just rather not eat anything at all.

Studies show that eating smaller, more frequent meals, in place of the traditional three large ones, lowers blood cholesterol levels and will help to stabilize blood sugar. This is a plus for anyone who is eating to beat heart disease or diabetes. We suggest that if you have either of these health concerns, that you discuss this style of eating with your doctor or a registered dietitian.