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Retirees live cheaply in Panama

When it comes to age-related discounts, you can’t beat Panama.

To attract more investment, the Central American nation has eased immigration laws and set up a discount bonanza for expatriate pensioners that includes 20 percent off professional services such as those provided by lawyers, architects and physical therapists; no property tax for 20 years; no income tax on income earned outside Panama; and a 50 percent discount on real estate closing costs.

The list of discounts goes on and on, including price breaks on telephone service, surgery and domestic airfares and a one-time waiver of duties on imported household goods up to $10,000.

All it takes to qualify is pension income of $500 or more per month — at any age and from any source.

Although the law creating the discounts has been around since 1987, Panama began to promote the discounts only about two years ago, said Rafael Donado, commercial attache at the Panamanian Embassy.

“It’s booming at this point — and the most attractive program worldwide,” he said.

And Panama’s legal tender is the dollar, making relocation even more painless, he said.

Well, we can’t all move to Panama, although it does sound tempting.

But many of us can qualify for other age-related discounts, both stateside and abroad, that help pre-retirement and retirement income go further.

From being able to get in the short line for car inspections in the District of Columbia to cheaper rates for vacationing in a castle in Spain, they’re worth checking out.

One of the most obvious places to start is with AARP, which provides a package of discounts for members.

Although many age-related discounts are reserved for people in their 60s, AARP membership begins at 50, and the $12.50 annual membership fee buys discounts of up to 30 percent on car rental rates from Hertz and Avis and on eye exams and eyewear from companies including LensCrafters and Pearle Vision and many other goods and services.

This holiday season, the group is launching a Web site that pools discounts on more than 500 brand-name products.

Airlines used to be a good deal for older travelers, offering a 10 percent discount, but most of them have cut those programs — along with peanuts, jobs and other expenses.

Southwest Airlines still offers savings for travelers older than 65, however.

airlines, such as SAS, Lufthansa and Virgin, still offer discounts, said Joan Rattner Heilman, author of Unbelievably Good Deals and Great Adventures That You Absolutely Can’t Get Unless You’re Over 50 (McGraw Hill).

“As far as everything else goes, there are more and more discounts out there” for lodging, meals and rental cars, she said.

But don’t assume the discount is the best deal.

Check travel Web sites, including Cheapfares.com and Travelocity.com, that offer bargains, and you might find an even bigger break.

There are particularly nice bargains for lodging outside the United States, although you have to book them well in advance, said Heilman.

For instance, if at least one member of your party is 60, you can get 40 percent off a stay (except for Friday and Saturday nights) at the beautiful Pousada de Castelo, perched on a hilltop surrounded by centuries-old walls in Obidos, Spain.

And Spain has breaks on its government-owned inns, many of which are converted castles or convents.

There are also many good deals on outdoor activities.

The National Park Service has offered its Golden Age Passport for 41 years.

A one-time fee of $10 buys a lifetime of free admission to national parks, including Shenandoah National Park, which charges $15 per car from March through November, and Yellowstone National Park, which charges $25 per car.

Heilman said many retirees ski more these days because they can ski midweek when the slopes are less crowded.

Many ski resorts cut lift-ticket prices in half for skiers older than 60 or 65, she said, and some allow even older skiers to ski for free.

For instance, a six-day trip on the Salmon River in Idaho offered by Warren River Expeditions costs $190 less if you’re 50 or older.

You might have to produce your driver’s license to get lower-priced movie tickets, but who knows, said Heilman.



Retirees need not retire from bargain hunting (Akron Beacon Journal)

Forget cheap movies and early-bird meals at Applebee’s. When it comes to age-related discounts, you can’t beat Panama.

technorati tags:retire+cheaply, cheap+places+to+retire

Small changes can help you save a lot of money for retirement

You don’t have to deprive yourself to cut your spending.

Just by making small changes, you may save a lot of money.

For example, you could stop buying lottery tickets or ask yourself, before you buy something, how many hours you had to work to pay for it or start to shop at less expensive places — going from Nordstrom’s to Macy’s to Kohl’s to Marshalls to a consignment shop.

That was some of the advice given during a forum Monday in Parsippany on steps people can take to bolster their health and their wealth.

The forum was sponsored by the Daily Record and Rutgers Cooperative Extension of Morris County.

The speakers were Barbara O’Neill and Patricia Q. Brennan of Rutgers Cooperative Extension.

O’Neill is co-author of a new book, “Small Steps to Health and Wealth,” on which the forum was based.

-Try to discard “baggage” that you may have learned as a child, Brennan said.

Such as: You’re not supposed to talk about money.

The government and your employer will take care of you.

To show your love, you must always give an expensive gift.

A high amount of debt is normal.

The man should handle all the finances.

If you can cut your food bill, which typically is $189.20 a week, by 10 percent, you can save $1,000 a year.

· To increase your income, consider getting a part-time job during the holidays.

Make affirmations, such as “I have stopped smoking” or “I am a millionaire in the making.”

For example, if your debt exceeds 20 percent of your take-home pay, it’s a danger sign — unless it’s mortgage debt.

O’Neill said, “If your debt is that high, you’re working one day a week for nothing.”

· When you get a raise in salary, save some of it.

To obtain a copy of the book, send a check for
$20 to Morris County Extension Service, FCHS Department, Rutgers
Cooperative Extension of Morris County, P.O. Box 900, Morristown, NJ
07963-0900. If you pick up the book at the extension office, the cost
is $16.

Small changes can save a lot of money (Daily Record)

You don’t have to deprive yourself to cut your spending. Just by making small changes, you may save a lot of money.

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Five tips to help Americans kick your retirement planning into overdrive:

1)   Save, Save and then Save Some More!

You’ll never save enough for retirement if you don’t start saving now.
Put every penny you can into your company’s defined contribution plan,
(commonly referred to as a 401(k), 403(b), 457 plan, etc.) especially
if your contributions are being matched by your employer. You want to
shelter all the money you can from taxes and take full advantage of
your employer’s matching retirement plan contributions. Also, don’t be
afraid to look at after-tax planning vehicles like the Roth IRA or the
new Roth 401(k), which is now a permanent part of the tax code as a
result of the Pension Protection Act. We are not likely to see tax
rates as low as they are now, so it may make sense to grow assets that
you won’t have to pay taxes on later.

“While it may be hard to give up the current year’s tax deduction, you
should ask yourself which makes more sense: paying tax on the seed
(your original contributions) or the crop (your earnings). In most
cases it makes more sense to pay taxes on the seed. That’s why we like
the new Roth 401(k)s,” says Hinds.

2)   A Retirement Account is NOT an ATM

Don’t even think about touching the money you put toward your
retirement. “Think of your retirements as a black hole,” says Hinds.
“Once you’ve contributed the money, tell yourself that it’s
untouchable.”

Hinds says that having a good reason to withdraw money doesn’t matter.
While you may think it wise to pay off debt or buy a bigger house,
remember that you will likely have to “pay yourself back with interest”
for any loans you take against your company-sponsored retirement plan.
If you have a self-directed IRA, you will incur taxes and penalties if
you withdraw the money too soon. Worse than that, says Hinds, the money
will not be growing - either tax-free or tax-deferred, depending on the
type of IRA you’ve got. Early withdrawals for the wrong reasons put you
further away from your goal of achieving a secure retirement.

3)   Social “not much” Security

If you were counting on Social Security benefits to help supplement
your retirement savings, think again. Most experts agree that the
social security benefit program that our parents and grandparents knew
will not be the one we experience. According to many studies, within
the next decade, Social Security will begin to pay out more in benefits
than it will collect in taxes. Hinds warns that the Social Security
check that arrives in the mail each month will not likely be a
meaningful contributor to retirement income, and says the need for
people to develop their own effective retirement planning strategies
has never been more important.    

4)   Diversity Matters

A diverse portfolio can be your ticket to stability. By creating a
diversified portfolio - and not just among stock sectors - your
investments may perform more stably. An investment portfolio should
include stocks, bonds and money market securities. According to Hinds,
having technology stocks, airline stocks and automobile stocks does not
constitute diversification.

“Investors should look to strike a balance, to create a diversified
portfolio that will help them reach their retirement goals effectively
and safely. And, while the core part of your portfolio should include a
strategic mix of stocks, bonds and cash, a portion should be devoted to
more progressive strategies aimed at producing greater potential
growth. Some of the newer strategies even have built in income
protection in retirement, while still having the growth potential of
the stock market,” she says.

Diversification seeks to improve the performance by spreading your
investment dollars into various asset classes to add balance to your
portfolio. However, using this methodology does not guarantee a profit
or protection from loss in a declining market.

5)   Retirement Planning is a Rolling Stone

If you switch employers, consider rolling your retirement plan into a
self-directed IRA account — not your next employer’s 401(k) account. A
self-directed IRA opens additional investment options not available in
a 401(k) account and provides the opportunity to create a Stretch IRA,
a great distribution and legacy planning strategy. Although it is
tempting to take the cash and treat yourself to something nice, the
responsible thing is to preserve your retirement funds.

“Leave that money alone. You want it to grow so that you can enjoy a
secure retirement later,” says Hinds. “The average American gets a new
job every four years. If a retirement plan is cashed out every time a
person gets a new job, that person will never be able to retire and
live a similar lifestyle from his or her savings. That doesn’t even
take into account the tax penalties associated with cashing out a
retirement account.”   

For more info: http://www.granitefinancial.net/

Five Perils to Your Retirement Well-Being (PR Web)

Long-time Financial Advisor Offers Tips to Supercharge Retirement Planning

technorati tags:retirement+planning+tips, social+security+retirement+planning, cashing+out+401k

Using a reverse mortgage in your retirement planning

More than 52 percent of Americans currently say they are worried about outliving their retirement money.

In contrast to the average retirement age decreasing from 66.9 in 1990 to 62.7 in 2000 - an average of five months per year - the average life expectancy has increased an average of four months per year over that same period.

This is a compounding effect that has caused a stressful situation for many retirees.

The “old view” of retirement planning included Social Security, corporate pensions, other personal savings, company savings, and no debt.

So, liability management has become almost a necessity to survive for a growing number of retirees.

When turning 62, an increasingly popular financial strategy for homeowners becomes available.

A reverse mortgage is a loan against a house that allows the owner to stay there without selling and requires no monthly mortgage payment for as long as the owner lives in the house.

The loan qualification is largely based on the age of the occupants (one occupant must be at least 62) and the current value of the house.

There are no minimum income, asset or credit qualifications to meet, and it has no effect on Social Security or Medicare benefits.

Reverse mortgages also have no stated maturity date and are due only after the last owner no longer lives in the home.

The three most appealing things to seniors are that the Federal Housing Administration and Fannie Mae guarantee the payments to the borrower, guarantee borrowers can stay in their home, and guarantee the loan payoff can never exceed the home’s value, thus protecting the owners and their heirs from getting into financial trouble.

Like other financial strategies in retirement, making decisions based on opinions and not facts can lead to poor decisions.

The most common myths of reverse mortgages are that the lender takes ownership of the home, the loan becomes the heir’s responsibility, and the heirs will be opposed to the strategy.

The borrower retains ownership of the home just like the home was originally financed.

The reverse mortgage is a non-recourse loan, meaning the lender can only derive repayment of the loan from the proceeds of the sale of the property.

Experience demonstrates that once educated, most heirs are strongly in favor of the reverse mortgage strategy.

So if your retirement plan needs additional income, you want to reduce the burden on your children, or you just want to give your grandkids an early inheritance, reversing traditional retirement thinking could be the difference in having more gold in your golden years.

Reverse your thinking on retirement Knoxville News Sentinel (subscription), TN - Dec 2, 2006 … retirees. A number of retirement planning challenges that face retirees today were not concerns in retirement planning previously. …

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