Tuesday, July 30, 2013

Some cities with "pre-retirement" working populations not prepared for demographic crisis

Many popular, high-tech oriented smaller American cities (like Austin, TX and Raleigh-Durham NC) have large populations of “pre seniors” still working, but will need many more services for seniors soon, when compared to cities (as in Florida) who market services to seniors.
Sharon Jayson has the snazzy article (“5 Must-Do’s as age-wave bears down on the USA”) in US Today Tuesday, July 30, 2013, here
  
Cities like Austin may have a false sense of security because many older adults are employed as executives in high tech businesses today.
  
Communities need to pay more attention to public transportation (making it usable), and to the availability of senior housing and caregiving.  
  
One obvious observation is the tremendous range in senior self-sufficiency and productivity.  We can look around and see some seniors whose dedication to goals seems to keep them almost immune to decline.  Look at Jimmy Carter, for example.  Strong extended and social ties are important to some seniors (as in the “Blue Zones” on Oprah) but might be overrated in importance;  some people are naturally more independent. 
  

Austin is one of my favorite cities (I lived in Dallas in the 1980’s).  

Monday, July 22, 2013

CNN describes "dementia village" in the Netherlands, as if it were an "Under the Dome" setup

On Saturday, CNN’s Sanjay Gupta presented a new concept in dementia care or Alzheimer’s care, a “Dementia village”, an experimental community in the Netherlands.

The village replicates most of the spaces in a normal town, including a grocery store, but there is no real money exchanged.  There is only one entranceway into the village, and Gupta said that residents will spend the rest of their lives there.

Gupta also compared the place to the artificial bubble community in the movie “The Truman Show” (or possibly Stephen King’s “Under the Dome”).

The CNN link is here.
    
How is this different from an assisted living or (better) a CCRC  (Continuing Care Retirement Community, July 10, 2010 post), other than having maybe more outdoor space?

Sunday, July 21, 2013

Wealth tax debate comes back, as governments find bailouts hard to justify in a world with "unearned assets" lying around

The next big battle that could really hit wealthier retirees may be “wealth taxes”, according to a Sunday Business article in the New York Times July 21, by Tyler Cowen, p. 6, link here

In the United States, the main “wealth taxes” in practice are property taxes, and inheritance and estate taxes, which generally have generous exemptions, as often discussed here previously.  There are also indirect wealth taxes subsumed in capital gains, and in practical requirements that depositors hold money in accounts with very low interest rates, making it easier for governments to borrow   “Wealth” taxes also raise the ideological objection of “double taxation”.
   

But economists also look at total wealth in an economy, much of it held by richer individuals or families, relative to public debt, and argue that it is hard to argue for bailouts and cutbacks when there is still so much wealth around.  This will be particularly true in Europe.  

Saturday, July 20, 2013

Municipal and state pension plans may have used bad actuarial math for decades -- not just Detroit, but all bond funds


Mary Williams Walsh has a major report on a possible major conceptual error in the way municipalities have estimated their pension obligations (income and payments) over the years.  Although immediate attention is drawn to the problem by the sudden Chapter 9 bankruptcy filing by the city of Detroit, the issue has been known for years, particularly since a dissertation was submitted on the area Jeremy Gold in 2000.  The link for the New York Times story is here

Brad Plumer has a story on the Washington Post Wonkblog that boils all this down to one problem: more retirees, fewer workers, link here
                                    
The implications, perhaps like a next chess move, should be obvious.  Is the math right for the millions of private pensions, even those which are closed but still paying out (like mine)?

Could the value of many mutual bond funds (especially tax-free municipals) be further undermined on Wall Street as the implications of this article get out?


And it is not completely clear that Detroit can legally avoid putting pensioners first in line in the current filing.  The applicable word is sacrifice. 

Saturday, July 13, 2013

Reverse mortgages may not remain "slam dunk"

Reverse mortgages, as a kind of “ATM” for baby boomers in retirement, may come under more scruting by HUD and the FHA soon, according to a New York Times Business Day story by Tara Siegel Bernard Saturday, July 13, 2013, link here.

The FHA eliminated a type of “lump sum” loan in 2012, but how it is considering rules requiring senior borrowers to undergo a financial assessment, which can include credit report, and evaluation of income, expenses, net worth, and liquidity. 

Borrowers have run into problems, like not being able to pay local property taxes.  (In Arlington VA, being one day late with a 6-month tax payment results in an automatic $250 penalty.)  
  
In my own circumstances, I would not be eligible for such an instrument because the house in which I have the right to live technically belongs to a trust.  There are indeed trade-offs in how you set things up.



Update: Monday, Nov. 13, 2017

I was told by an attorney today that I could have used my trust for a reverse mortgage rather than selling for a downsized place if I needed cash, and there are some strategic advantages to doing so (not downsizing). I'll cover some of this discussion on Wordpress soon in more detail.

Thursday, July 11, 2013

Americans will have longer periods of disability at end of life

The Wall Street Journal has an important story Thursday, July 11, 2013 by Ron Winslow, “Longer, not healthier lives: Americans see gains in longevity, but are spending more years with disabilities”, p. A3.

The story is based on a new study in JAMA, the Journal of the American Medical Association.  
  
This is the worst possible news for adult children who are likely to wind up as caregivers, particularly as states like Pennsylvania) may show more interest in enforcing their filial responsibility laws.  In a culture that values human life at all costs, many ethical issues about “personal responsibility” and the importance of marriage turn on their heads.   
  
  
The biggest increase in disability is likely to come from Alzheimer’s disease. 
   

Obesity is cited as a reason for disability, but it is complex/  Weight does not always cause earlier death or heart disease.  But it is correlated to income.  Obesity and Type 2 diabetes seems to be increasing with poverty, and seems less common in educated and upper income families.  I’ve noticed something else, too.  Generally, gay men are a little less likely than usual to be or become obese.  

Wednesday, July 10, 2013

Today is Bill's 70th birthday, in retirement (not in relief)

Today, Wednesday, July 10, 2013, I “celebrated” my seventieth birthday.  Yupm three score and ten.
I don’t think I’ll make an “eleventieth” birthday, like Baggins.  And I made “career” decisions that depend on living off accumulations, and not veering off course of being a journalist, not hocking things—not good if I could live as long as people in Middle Earth. 

So I find myself watching interest rates, the markets, stability, the debt ceiling. Watching how real people work and live.  
It’s interesting to go back in time, reverse chronological order, by ten years at a time. It's not so optimistic as to how many decades ahead there can be. 

At this time in 2003 (as I turned 60), I was in my last two months in Minneapolis, engrossed in my job job as a debt collector for RMA near the MSP airport, even though I knew I would soon go back to VA. “Lawrence v. Texas” had just been decided.  Much of the past decade would be consumed with eldercare for my mother.  I would start Social Security early in 2005 at age 62.

In 1993 (turning 50), I lived in a high rise apartment in Arlington VA, near mother.   I worked for USLICO, an  insurance company with ties to the military that would be obliterated by mergers (eventually with ING). Bill Clinton was about to announce   “Don’t Ask, Don’t Tell, Don’t Pursue”, and I was contemplating my dance moves to get into the debate.  That would happen with my 1997 book, after a lot of preparation. 

 That would lead to my relocation to Minneapolis for six years and become one of the most interesting periods of my life.

In 1983 (turning 40), I was living in Harvey’s Racquet apartments in the Oak Lawn section of Dallas, TX, working for Chilton (now Experian).  I was active in the chess club and winning games.   But the AIDS epidemic had become a big scare.  I would even have a (negative) biopsy for Kaposi’s Sarcoma and become an AIDS buddy with the Oak Lawn Counseling Center.  Economic downturns would help stimulate my move back to Virginia in 1988.

In 1973 (30), I lived in Caldwell NJ and worked for Univac.  I had just “come out” a second time.  I wanted to move into NYC and explore my new life, which I would do in 1974.

In 1963 (20), I was living at home and going to GWU full time. I would soon take my first wage-paying job, at the National Bureau of Standards.  I had been thrown out of William and Mary in the fall of 1961 for admitting homosexuality, and undergone “therapy” at NIH in the fall of 1962.  These were not good times.  
But I would go on to graduate school at the University of Kansas in 1966, earn an MA, and get drafted and serve in the Army honorably, setting myself up for a Great Irony three decades later.

In 1953 (10), I was about to start fifth grade, but had started piano lessons in 1952. I learned to root for the Washington Senators baseball that summer. 
  

I do count on pension and social security.  It’s a good thing I’m not a retiree from the city of Detroit, from what I read today.  Comerica Park is an oasis.  I was there in 2012. 

Thursday, July 04, 2013

If national service is proposed for young adults, could it also be expected of retirees?

There’s been buzz about national service recently, especially a proposal by Ret Gen Stanley McChrystal to set up an “expected” but legally voluntary form of national service for people between ages 18-28, for one year. 
  
E.J. Dionne, Jr. weighs in on this proposal on p. A19 of the July 4 Washington Post, “A call to service”, here.  Dionne ends his piece with an important reference to the idea that “inalienable rights entail certain unavoidable responsibilities”.  Indeed, these common responsibilities, and higher calls to socialization, tend to drill deep into person areas and reinforce the need for complementarity in personal relationships, and foster the interdependence necessary for sustainability.

President Obama had mentioned such an idea about the time of his first term inauguration in 2009 (particularly in commencement speeches), but has backed off a bit from the idea. 

A natural question would be, should it be limited to just young adults?  Maybe it should be expected of physically capable retirees, too. 

I did attend some sessions on the Peace Corps in 2003 (while still in Minneapolis), and heard that the oldest volunteer was 82 at the time.  But the volunteer form seemed to place a lot of emphasis on previous volunteerism and activities indicating a lot of socialization, such as personal caregiving or childcare, as well as participation in organizations.  I recall a prescient comment at a session about online reputation of volunteers, too -- that could become very sensitive overseas in less developed, less democratic countries.  
  
In fact, there is something disturbing about connecting volunteerism to bureaucracy, which becomes a source of power for some people.  I’ve even run in to a little bit of this with AIDS-service organizations in the past.
The government has had is own volunteer bureaucracy (like AmericCorps and Teach for America)  since 9/11, and it looks like just that. 

Let's not forget that for many adults today, including the childless -- caring for elderly parents (filial responsibility) and sometimes other family members is quickly growing as a kind of "service".

But Dionne is probably referring to a more regimented kind of experience -- where you live in a unit or group and do not have everyday touch with your own affairs or even on-line life, a bit like military service. 
    
For young adults, it’s worth noting that faith-based organizations often sponsor overseas infrastructure projects, especially having to do with clean water.  For an engineering school graduate, this may be a kind of service, but it’s a great first job on a resume and an adventure.