Archives for March 2011
Why Inflation hurts more than it did 30 years ago
Inflation hurts more than it did 30 years ago for Americans stuck with flat income WASHINGTON (AP) -- Inflation spooked the nation in the early 1980s. It surged and kept rising until it topped 13 percent. These days, inflation is much lower. Yet to many Americans, it feels worse now. And for a good reason: Their income has been even flatter than inflation. Back in the '80's, the money people made typically more than made up for high inflation. In 1981, banks would pay nearly 16 percent on a six-month CD. And workers typically got pay raises to match their…
5 Biggest Retirement Myths
It was a simple enough proposition. Michael and Margie Gershtenson had always heard that the Southwest, land of cacti, affordable housing and low taxes, was a great retiree haven. And they knew they needed to set aside a certain amount for life's next chapter—as those big-broker ads ask, "What's your number?" So they set up a foolproof plan: Build a nest egg of at least $3 million, and get out of town. Which is exactly what they did, hitting that threshold five years ago and closing down their dental practice in Colorado—Michael had been the dentist, Margie the hygienist.…
How to Deal With Inflation Risk in Retirement
In 1960, the median value of a home in the U.S. was $11,900. Today, some 50 years later, you'd be hard pressed to buy a decent car for that amount given that the average price in 2010 was close to $30,000. And in 50 more years, you might find it impossible to buy a car for $170,000, which was the median sales price of a single-family home in the U.S. in 2010. And that, my friends, is inflation — one of the most insidious risks Americans will face in retirement. Yet despite years of witnessing firsthand the…