A digest of timely information and insight about finance, investing, and retirement.
Becker: Putting PERA on a path to prosperity | Denver Post
Democrats and Republicans in the Colorado General Assembly are elected to solve problems and to make our state a better place to live, thrive and yes — retire. Our state is no stranger to drought and the Public Employees’ Retirement Association pension system was drying up the future of our retirees and public servants. This session legislators were faced with the colossal challenge of fixing this broken retirement system on behalf of our constituents.
Some people get a pit in the stomach when they think about saying goodbye to that paycheck. Or at the prospect of deconstructing a nest egg they spent decades building. They might worry about feeling irrelevant or bored without the stimulation of work. For most people, retirement won’t be carefree. They will replace whatever worries they have now with a new set of concerns: health (and their mortality), money, humankind’s future. Of course, timing is everything: Retire too early, and you risk outliving your money. Stay at the desk too long, and you might miss out on life.
Vanguard has issued a new framework, jointly developed with Mercer, that helps pre-retirees and retirees better understand the financial planning implications of annual health care costs and long-term care expenses. The research paper, “Planning for healthcare costs in retirement,” outlines key health care cost factors and personal considerations, as well as frames health care expenses as an annual cost rather than a lifetime lump sum.
You might think of networking as a necessary career-boosting tool, but it’s just as important in retirement. Many retirees quickly realize how closely their identities were attached to their jobs. They are unprepared for a post-career life that may not include their colleagues and “work family.”
During a period of uncertainty about potential changes to pension benefits, retirements in Kentucky surged among state and local government employees over the past 12 months. But in comparison, the number of Kentucky teachers retiring did not increase. Kentucky Retirement Systems reports that 8,445 state and local government employees will retire in the fiscal year that will end June 30 — an increase of 17.5 percent in the number of retirements over the previous fiscal year.
State’s $12.5B pension shortfall contributes to reduced bond rating | Santa Fe New Mexican
A lagging economy and New Mexico’s “extremely large pension liabilities” helped lead a national credit rating agency to downgrade the state’s bond rating by a notch. Bond ratings, which reflect confidence in a state’s ability to pay its debts, can affect borrowing costs for road building and other projects. In dropping New Mexico’s general obligation bond rating to Aa2, its third-highest rating, Moody’s Investors Service cited New Mexico’s obligations to the Public Employees Retirement System and the Educational Employees Retirement System, which face total shortfalls of about $12.5 billion.