Finding meaning / purpose can extend your life
A recent British study led by Andrew Steptoe, Director of the Institute of Epidemiology and Health care at University College London found that after taking other factors into account “people with the highest levels of ‘purpose in life’ were 30% less likely to die during the study period, living an average of two years longer than those with the lowest levels.” The study involved 9,000 people averaging 65 years old. (1)
James Maddux, Professor Emeritus of Psychology at George Mason University in Fairfax, Virginia, reviewed the study and his team agreed that the findings make sense. Maddux noted that “people who actively search for meaning in life may be generally better at setting goals and making plans, including health care decisions.” The study review said there is good news for people who lack a sense of purpose—“it can be increased”—for instance, other studies have found that meditation, group therapy, taking classes or volunteering can help.
Work longer, live longer
In another study in 2016 conducted by Oregon State University, (2) research indicates that working past age 65 could lead to a longer life, while retiring early may be a risk factor for an earlier death. Chenkai Wu, lead author and currently a doctoral student in the College of Public Health and Human Sciences, did the original research as part of his master’s thesis.
The researchers found that healthy adults who retired one year past age 65 had an 11 percent lower risk of death from all causes, even when taking into account demographic, lifestyle and health issues. They also found that even adults who described themselves as unhealthy were likely to live longer if they kept working.
“It may not apply to everybody, but we think work brings people a lot of economic and social benefits that could impact the length of their lives,” said Wu. He became interested in the topic due to much debated mandatory retirement ages in China, which in 2015 were 50 for men and 60 for women and men in labor-intensive jobs, and 55 and 65 respectively for white-collar women and men. (3)
“Most research in this area has focused on the economic impacts of delaying retirement. I thought it might be good to look at the health impacts,” Wu said. “People in the U.S. have more flexibility about when they retire compared to other countries, so it made sense to look at data from the U.S.” He examined data collected from 1992 through 2010, focusing on 2,956 U.S. adults. (2)
Planning for a longer life
There is no better time than now to put a plan in place which accounts for the longer years you may live, and encompasses your deepest desires as well as your current and future financial resources.
1 Pfizer, Get Old, “A ‘Purpose in Life’ May Extend Yours,” by Robert Preidt, HealthDay, July 15, 2016. getold.com. https://www.getold.com/a-purpose-in-life-may-extend-yours (accessed January 17, 2017).
2 OSU, Oregon State University, News and Research Communications “Working Longer May Lead to a Longer Life, New OSU Research Shows,” 04/27/2016. oregonstate.edu. http://oregonstate.edu/ua/ncs/archives/2016/apr/working-longer-may-lead-longer-life-new-osu-research-shows (accessed January 17, 2017).
3 USCBC, The US-China Business Council, “China’s Mandatory Retirement Age Changes: Impact for Foreign Companies,” by Owen Haacke, April 1, 2015. uschina.org. https://www.uschina.org/china%E2%80%99s-mandatory-retirement-age-changes-impact-foreign-companies (accessed January 17, 2017).
Whether you have children, grandchildren, nieces or nephews headed to college when they turn get into high school, it’s always best to put anticipated higher education expenses into your financial plan--the sooner/younger the better.
Call us to discuss. And read here to learn more:
1. FAFSA dates have just changed
For students college-bound in the 2017-2018 school year, there is an important FAFSA date change: the application date was just changed from January 1, 2017 to October 1, 2016—three months earlier. Details here.
Even if you think your family makes too much money to qualify for aid, most experts say you should apply for FAFSA (Free Application for Federal Student Aid) anyway, because colleges, state scholarship agencies, and foundations use the FAFSA when deciding who gets their scholarships, as well as how much each student will receive.
Students already on campus should also apply every year. And remember that school deadlines may be different from FAFSA deadlines.2. In terms of job prospects, a college degree is more necessary than ever.
According to the Department of Education,“a postsecondary credential has never been more important” because:
3. The cost of a college degree is high…second only to a home mortgage.
It’s no secret that college costs have skyrocketed. “College has never been more expensive…over the last three decades, tuition at four-year colleges has more than doubled, even after adjusting for inflation,” according to the Department of Education.
For the 2015-16 school year, the College Board estimated the average tuition and fees to be $9,410 per year at four-year, in-state public institutions. Room and board was about $10,000 annually. When you total various scenarios, the average cost of a bachelor’s degree ranges from $52,000-$130,000, depending on whether your child attends in-state or out-of-state, public vs. private university, attends community college first, and whether or not they have housing and food provided.
Chart from CollegeBoard.org
In fact, these days, paying for a college education is one of the biggest outlays any family will ever make, after their home mortgage.
Why so much? According to a Center for American Progress report, it was “the Great Recession and resultant state budget cuts that led to the public college tuition hikes which have unduly burdened low- and moderate-income families.”
4. Student debt is the highest in history
Student debt is a $140 billion-a-year industry, with 42 million Americans bearing $1.3 trillion in student debt. The federal government holds 93% of these outstanding student loans, making the Department of Education, in essence, one of the world’s largest banks. The average class of 2016 graduate with a student loan will owe more than $37,172, the highest level of debt yet. Almost 71% of bachelor degree recipients will graduate with a student loan, compared with less than 50% two decades ago.
Wall Street Journal
5. Try NOT to sacrifice retirement for college
A recent survey of parents by HSBC Group found that 98% of U.S. parents are considering a college education for their child—and 60% would be willing to go into debt to fund it. Although parents say this makes it difficult to keep up with other financial commitments, they still think it’s more important than long-term savings or credit card repayment. And 37% of U.S. parents say their children’s education is more important than their own retirement savings.
Commenting on the findings, HSBC’s Global Head of Wealth Management said:
“The financial sacrifices that parents are willing to make to fund their children’s education are proof of the unquestioning support they will give to help them achieve their ambitions. However, parents need to make sure that this financial investment is not made to the detriment of their own future wellbeing.
“By having a financial plan to meet their family’s overall needs and reviewing it regularly, parents will be better placed to support their children’s studies without compromising on their own long-term financial goals.”
A recent segment on CNBC agrees that sacrificing your retirement is not the best decision in the long run, and urges people to plan early: Watch here.
Let’s discuss ways you can plan ahead to fund both college tuition and your retirement. Call us today.
Volunteerism among retirees is popular these days and the activity seems to help them live longer. Studies from the Corporation for National and Community Service show people who volunteer “report lower mortality rates, lower rates of depression, fewer physical limitations and lower levels of stress than those who don't volunteer.” Data from the 2014 study shows 20 million older adults 55 and up average more than 3 billion hours of service in their communities annually. The value of this time is estimated at $75 billion.
Volunteering has some tax saving benefits, too. Though you can’t deduct anything for the time you spend volunteering, you can deduct the cost of gas and oil for your automobile while driving to the activity, or simply deduct 14 cents per mile. Other deductions can include uniforms and attending conventions.
Finding the Right Activity
Like a job, volunteering requires the right fit. It may seem logical to offer the experience and skills you developed while working but doing something completely different may be more rewarding. Make sure the activity offers the flexibility to fit your schedule and that it’s something you feel passionate about.
You’ve heard of foster parent programs, but did you know there are programs that pair children in need with foster grandparents? This is just one of the volunteer opportunities available through America’s Senior Corp program. Learn more at https://www.nationalservice.gov/programs/senior-corps/get-involved
There are plenty of resources to find the right activity. The federal government offers Serve.gov. Another great place to look is AARP's Create the Good program.
Your community needs your talents and your commitment. And with the positive benefits of volunteering, this is truly a win-win situation.
Do You Need a Will or Trust? Or Both?
When it comes to estate planning, most of us are at least familiar with t
he terms will and trust. However, it’s important to understand how they work. One difference is that a will goes into effect after death while a trust can be used to distribute property before or after death.
A will is a legal arrangement that has several important functions and usually requires at least one witness. (State requirements vary, for instance, two witnesses are required in Arizona.) A will is used to designate your chosen guardian/s for any minor children. A will gives instructions on how you wish your assets to be distributed upon your death. It names beneficiaries of your estate and what they are to receive. A will allows you to choose an executor, a person responsible for overseeing the distribution of your assets.
The important thing to remember is that a will is subject to probate. This court process goes into the public record, determines the validity of the will, considers any objections and pays any remaining creditors. Probate can take several months—or even longer if you die without a will.
A trust is a relationship in which an individual assigns their assets through another entity, called the “trustee.” The trustee is often another individual, a bank or an attorney, and they have the responsibility of transferring title of the assets to the trust's beneficiaries. Usually, two important goals of a trust are to keep the arrangement private and avoid probate.
A trust, however, doesn’t allow you to name a chosen guardian for your minor children, dictate funeral arrangements or determine who gets personal property items not specifically named in the trust. This is why a trust is almost always accompanied by a will.
Not everyone needs a trust, but it’s helpful if, for example, you have minor children who will be receiving your assets when they become adults because a trust can specify requirements that must be met before assets will be transferred to them. A trust is also commonly used to assign assets to a charitable organization.
Remember, wills and trusts aren’t just for the wealthy—just about everyone has assets of one kind or another. These estate planning tools help you dictate how and when they are to be distributed. It’s important to get professional help that may include an attorney, and it doesn’t have to be an expensive process.
Please contact us if you need help with setting up or reviewing your estate plan.
Learn more here:
Investopedia.com (link to this article) http://www.investopedia.com/articles/personal-finance/070715/estate-planning-living-trusts-vs-simple-wills.asp
ElderLawAnswers.com (link to this article)