 |
|||
|
|
|
|
|
|
|
|||
- Luncheon Site Questionnaires, Results
- Fraud Alerts!
- Baby Boomers Will Spend Golden Years at Work
- IRS Warns Taxpayers of New E-mail Scams
- Government Workers Feeling Pension Pressure
- Social Security, Should I Collect at 62?
*************************************************
RESULTS OF LUNCHEON SITE QUESTIONNAIRES
(Filled out by Attendees at the April 10, 2008 RPESJC Lunch)
The RPESJC Board of Directors recently appointed an ad-hoc committee to review the attendance, cost, quality, and facilities of the current monthly lunches in order to determine if changes are needed and what kind of changes would be most acceptable to the membership. Thirty-four retirees in attendance at the April 10, 2008 RPESJC Luncheon at John’s Incredible Pizza were asked to fill out a questionnaire. This was a first step in the process; to find out what those who regularly attend prefer. You can access the results of that questionnaire by clicking on this link.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
- Fraud Alert! Bogus Telemarketer
- Fraud Alert! Digital Television
- Fraud Alert! Lottery Schemes
- Fraud Alert! Pet Scams
- Fraud Alert! Phishing
- Fraud Alert! Stop Calling Me!
- Fraud Alert! Sweepstake Schemes
- Fraud Alert! Tax-Time Scams
- Fraud Alert! Traveling Con Artists
Bogus Telemarketers Seek Credit Card Info
Fraudulent telemarketers are calling consumers claiming to be with your credit card company and needing to “verify information.” Callers may say they are with the security department from VISA or MasterCard, and ask if you have purchased an anti-telemarketing device for $500 from an Arizona company. When you say “no,” the caller says they will issue a credit to your account, and need to verify your address and the seven-digit security number on the back of your card. The caller will ask that you read the last three numbers to verify that the card has not been lost or stolen.
The callers are not from VISA or MasterCard, but are con artists who trick you into giving out valuable security information so they can use your credit card number for purchases over the Internet or telephone.
To protect yourself from credit card fraud:
ü NEVER give out personal information to anyone who has called or emailed you – no matter if they claim to be with a “security department.” Credit card companies and banks never ask for anything off their cards because they already have that information;
ü Don’t talk to strangers over the phone or reply to unsolicited e-mail.
For assistance call the
DA's Elder Fraud Line:
(209) 468-2488
Also visit SJC District Attorney's Web Site: http://www.sjgov.org/da/
For additional fraud alert information from the San Joaquin District Attorney's office click here: Jan 2008 Fraud Alert
CASE is a Partnership of the District Attorney and the Community to Prevent Elder Financial Exploitation
The FBI Internet Crime Report reveals the top internet scams of 2007. Pet Scams: You see an ad selling a pet and send in your money, plus a little extra for delivery. You never get the pet; the scam artist simply takes your money and runs.....(more)
Many Internet users are receiving e-mails requesting account information. The e-mail sender is supposedly a bank, government agency, or companies like eBay or PayPal; but in reality they are criminals.
Attempts to steal your sensitive information are called "phishing" and it is very prevalent.......(more)
Fraud Alert!....Stop Calling Me!
Tired of calls from strangers? Take back control of your telephone! How do you do this? Click here.
Fraud Alert!....Tax-Time Scams
Don't let tax-time become scam-time. For more information on phony IRS e-mails and fictitious bank correspondence and phony forms, click on this link!
Fraud Alert!....Traveling Con Artists
Traveling con artists are in San Joaquin County. For more information click on this link!
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
|
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ IRS Warns Taxpayers of New E-mail Scams |
|
|
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Government Workers Feeling Pension Pressure
Unions battle to retain fixed monthly checks instead of individual accounts
By Martin Wolk
Chief economics correspondent MSNBC
The promise of a lifelong monthly retirement check, with all the security that implies, has always been one of the biggest attractions of government service, from sanitation workers to members of Congress.
Now police officers, teachers, public health workers and the unions that represent them in many states are scrambling to defend the treasured benefit that the vast majority of them still enjoy but is rapidly disappearing from the corporate world.
For the most part they are winning, arguing successfully that providing a traditional pension plan for public workers is a cost-effective investment of taxpayer dollars, helping to attract and retain a higher-quality workforce.
But the stock market run up of the late 1990s and its subsequent collapse has left some state pension funds badly under funded, opening the door to free-market advocates who want to see public workers funneled into defined contribution pension plans similar to the 401(k) accounts that have come dominate the private sector.
Officials of unions representing public-sector workers describe the battle over the future of retirement as one of their top two priorities, along with health-care costs.
It is a very hot issue, said Rich Ferlauto, director of pension investment for the American Federation of State, County and Municipal Employees. The movement to privatize pensions really threatens the middle-class lifestyle of people who have worked all their lives he said.
In Alaska, lawmakers last year voted to stop offering a "defined-benefit" pension plan, which provides monthly checks for the lifetime of each retiree. Current teachers, police officers and other state and local government employees will keep the benefit, but new hires will be required to participate in a "defined-contribution" plan similar to a 401(k).
Under the new plan employees will contribute 8 percent of their pretax pay into an individual retirement savings account, which their employer will partly match with a 5 percent contribution, with additional contributions for health care and death and disability benefits. The funds will be invested in any of 10 stock or bond funds as allocated by the employee.
Oregon recently shifted to a hybrid that adds elements of an individual account. But elsewhere the idea has been rejected, most recently in California and Colorado.
In essence, the debate over President Bush’s plan to privatize Social Security is being played out on dozens of smaller stages as managers of state and municipal pension plans grapple with the fallout of the 2000-2002 bear market, compounded in some cases by mismanagement, reckless political choices and possibly fraud.
Free-market activists say public-sector employees should shoulder more of the burden for their own retirement security, putting money aside in personal accounts that would get some government matching funds but would be managed by each individual.
That would mirror the trend in the private sector, where only one-third of new employees at larger companies are covered by a traditional pension, compared with 80 percent just two decades ago. By contrast 90 percent of government workers still have a defined-benefit pension plan, according to the Employee Benefit Research Institute.
The push to defined-contribution plans is a worrisome prospect to people like Doris Sutherland, 78, of Grand Junction, Colo., who retired from her job as a secretary for a state agency in 1988 and now lives mostly on her $2,300 monthly pension. Sutherland gets no Social Security benefit from her many years of public service because state and local government workers in Colorado, along with several other states, are exempt from the system.
Sutherland contributed up to 11 percent of her pay into the state's public-employee pension plan over the years and now is vigilant against any attacks on it, acting as an advocate for retirees in her union, the Colorado Association of Public Employees.
"I think for most of the people that are retired right now, their benefit is pretty secure," she said. "But I don’t want new hires to have nothing to look forward to. If they don’t have a sound retirement (plan), they won't stay any length of time."
Sutherland supplements her income with work as a gift-wrapper and with a small 401(k) from a brief stint in the private sector, but she is skeptical about investing her retirement savings in the stock market. "I don’t think it's that sound of an investment," she said.
The debate over the future of pensions for government workers has been pushed along by the deteriorating financial condition of many state and municipal retirement funds. In fiscal 2000, the average state pension plan had assets equal to 107 percent of their liabilities, according to Wilshire Consulting, which surveyed 125 big plans with total assets of nearly $2 trillion. By fiscal 2005 that figure had dropped to 85 percent. Unfunded liabilities totaled $242 billion as of fiscal 2003, the last year for which complete figures were available.
In some states, the picture is far bleaker. In Illinois, the state pension plan has assets valued at only 60 percent of its liabilities, and in West Virginia the figure is 44 percent, according to a report issued this year by Standard & Poor’s.
Parry Young, a credit analyst with Standard & Poor’s, said the main reason funding levels have dropped so low at some state pension funds is that the bull market of the 1990s emboldened state legislators to take contribution "holidays" and in many cases to increase benefits.
Most of the state plans were created in the 1920s and 1930s and were never fully funded until the 1990s stock bubble made every fund manager look like a stock-picking genius. By 2000, with the strong bull market, on average they got up over 100 percent, so everyone was feeling very confident Young said.
Because of actuarial accounting methods that smooth out changes in asset values, the full impact of the bear market did not become apparent until several years after the market peaked. And then in some states, the loss of assets triggered a crisis.
In Colorado, the crisis came to a head this past spring with a pitched battle over the future of the state's pension plan, but unions defeated a movement to switch the system to a defined-contribution type.
California Gov. Arnold Schwarzenegger also learned the perils of trying to take on the pension benefits of government workers.
Last year, in his state of the state address, Schwarzenegger proposed moving to a defined-contribution plan, saying the state’s pension system was a train on a track to disaster. He endorsed a constitutional amendment that would have eliminated defined-benefit pensions for new employees.
State employees, including police, firefighters and public health nurses quickly mobilized, focusing on a provision in the proposed ballot initiative that would have scrapped death and disability benefits. Schwarzenegger’s popularity plummeted, partly as a result of intense union opposition to the plan. The governor ultimately withdrew his support.
Elsewhere, though, advocates of the individual approach to retirement plans have scored some successes. Michigan has been using a mandatory defined-contribution plan since 1997, after a reform bill narrowly passed the state Legislature and was signed into law by then-Gov. John Engler.
While the plan has been in effect for more than a decade, it will take many, many years to determine which is better for taxpayers and workers -- the defined-benefit or the defined-contribution plan, said Chris DeRose, the state’s director of retirement services.
State agencies certainly have more certainty about the contributions they need to make for the defined-contribution employees, he said. But about half the employees are still in the defined-benefit plan, which has enjoyed strong market returns over the past three years, he said.
Advocates of defined-benefit plans say they operate at a lower cost, which increases returns over the long run, and that individuals generally do a poor job of managing their retirement savings, investing either too aggressively or too cautiously.
They point to the example of Nebraska, which switched to a defined-contribution plan in the 1960s and then switched back to a traditional pension plan several years ago largely because of the low returns being earned in individual accounts.
Experts say there is no easy answer to the question of what is the best retirement plan but generally agree that for a secure retirement, workers should have the traditional three-legged stool of a fixed pension like Social Security, tax-deferred savings and ordinary savings.
If you ask a pension professional what is the best type of pension plan to have, a defined benefit or defined contribution plan, you ordinarily will get the same answer, said Mark Iwry, a non-resident senior fellow of the Brookings Institution and a senior adviser of the Retirement Security Project.
The answer is both, he said. You want a combination of the attributes of the defined benefit plan on the one hand and the defined contribution plan on the other.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
You can collect Social Security when you're 62, but should you?
Oldest Boomers reach that age this year - need to consider health care, benefits
The oldest Baby Boomers turn 62 this year, and some are using that as the catalyst to consider retiring.
It's possible because they can begin collecting their Social Security benefits at that age, though at a lower level than if they wait until age 66 or older.
But before quitting their jobs, Baby Boomers need to think long and hard about whether they're ready financially and psychologically to move into the next phase of their lives, experts say.
"For some, turning 62 is the siren calling from the shore," said William Wright, a certified financial planner in Wichita and president of the Financial Planning Association of Kansas. "There's the opportunity for the Social Security check ... and we've been through four years of bull market, so people have amassed the assets."
But Boomers considering early retirement also need some sense of what they're going to do with their time.
"There's a set of financial conditions and psychological and qualitative conditions," Wright said. "Not having both can spell peril for the retiree."
Bill Frisbie, 64, who retired from his job selling print products 2 1/2 years ago because of Parkinson's disease, said he would have continued to work if he hadn't gotten sick.
"I liked the thrill of the hunt," he said. "I worked 60-hour, 70-hour weeks. I actually miss that."
Diminished benefits
He worries that if his wife, Lynette, 57 and an executive with the Western wear company Sheplers Inc., retires too early, she'll be bored or risk outliving their savings.
On the other hand, he said, the couple have been working with Wright to determine whether they have the resources for her to join him in retirement in a couple of years.
"The real positive side is that it would give us more time together," Frisbie said.
Experts say there are a number of issues Boomers should weigh before plunging into retirement.
While Americans can begin collecting Social Security at age 62, their monthly benefit check will be at least 25 percent smaller than it would be if they wait to full retirement age. The impact on benefits can be determined at the Social Security Web site, www.socialsecurity.gov. Search for the "retirement age calculator" and then click on "age 62 benefit" for the analysis.
Health care crucial
Bryan Beatty, a fee-based asset manager in Vienna, Va., said many would-be early retirees also overlook health care costs.
"A lot of people don't realize that Medicare doesn't kick in until age 65," he said. Medicare is the federal health insurance program that provides hospitalization, medical and drug coverage.
Bridging the gap in coverage between 62 and 65 can be expensive, he said, especially for workers who don't have retiree health coverage. In some cases, a worker can take advantage of a spouse's coverage. In others, they can buy 18 months of coverage from their former employers under a program known by the acronym COBRA.
An alternative is private health insurance, "but you better not have any pre-existing conditions," Beatty warned.
Drew Denning, vice president for the retiree services division at the Principal Financial Group in Des Moines, Iowa, said Boomers also need to "make sure your nest egg is at critical mass."
He noted that studies by the nonprofit Employee Benefit Research Institute in Washington and other groups have found that a majority of Americans haven't saved enough and haven't tried to estimate retirement expenses.
Denning's quick formula: Figure that you'll spend in retirement 70 to 100 percent of what you do before retirement. Subtract your Social Security benefit. Subtract your pension, if you've got one. Say the result is that you need an additional $50,000 a year. Multiply that number by 20 to 25.
In this case, your nest egg needs to be at least $1 million, which will allow withdrawal at a rate of 4 to 5 percent a year to support your lifestyle. Because the numbers are so daunting, many Boomers will have to work beyond 62, he said.
"Frankly, you're better off knowing at 62 that you can't afford to retire until 65 than to find out at 75 that you can't make it," Denning said.
Options in starting Social Security
Drew Denning, vice president of the retiree services division at the Principal Financial Group, suggests that Baby Boomers look at several factors before deciding when to collect Social Security benefits:
Take Social Security early:
-- If you don't expect to live long
-- If you have a rich pension
Take benefits at full retirement age, which is 66 or older for Boomers:
-- If you expect to live a very long life
-- If you can live on other assets until 70, then count on Social Security as a guaranteed income stream
Used with permission of The Associated Press © 2008 All Rights Reserved.