SAVVY SENIOR
Financial Paperwork: What to Keep, What to Toss

 

Feb. 3, 2016

Jim Miller


Dear Savvy Senior,

How long should a person hang on to old receipts, stock records, tax returns and other financial documents? I have accumulated boxes full of such papers over the years and would like to get rid of some of it now that I’m retired.

Getting Organized

 

Dear Getting,

This is a great time of the year to get rid of unnecessary or outdated paperwork and to organize your records in preparation for filing your tax return in the spring. Here’s a checklist of what to keep and what to toss out, along with some tips to help you reduce your future paper accumulation.
 

Toss Out

*ATM receipts and bank-deposit slips as soon as you match them up with your monthly statement.

*Credit card receipts after you get your statement, unless you might return the item or need proof of purchase for a warranty.

*Credit card statements that do not have a tax-related expense on them.

*Utility bills when the following month’s bill arrives showing that your prior payment was received. If you wish to track utility usage over time, you may want to keep them for a year, or if you deduct a home office on your taxes keep them for seven years.

To avoid identity theft, be sure you shred anything you throw away that contains your personal information. It’s best to use a crosscut shredder rather than a strip one, which leaves long paper bands that could be reassembled.

 

Keep One Year

*Paycheck stubs until you get your W-2 in January to check its accuracy.

*Bank statements (savings and checking account) to confirm your 1099s.

*Brokerage, 401(k), IRA and other investment statements until you get your annual summary (keep longer for tax purposes if they show a gain or loss).

*Receipts for health care bills in case you qualify for a medical deduction.

 

Keep Seven Years

Supporting documents for your taxes, including W-2s, 1099s, and receipts or canceled checks that substantiate deductions. The IRS usually has up to three years after you file to audit you but may look back up to six years if it suspects you substantially underreported income or committed fraud.

 

Keep Indefinitely

*Tax returns with proof of filing and payment. You should keep these for at least seven years, but many experts recommend you keep them forever because they provide a record of your financial history.

*IRS forms that you filed when making nondeductible contributions to a traditional IRA or a Roth conversion.

*Receipts for capital improvements that you’ve made to your home until seven years after you sell the house.

*Retirement and brokerage account annual statements as long as you hold those investments.

*Defined-benefit pension plan documents.

*Savings bonds until redeemed.

*Loan documents until the loan is paid off.

*Vehicle titles and registration information as long as you own the car, boat, truck, or other vehicle.

*Insurance policies as long as you have them.

*Warranties or receipts for big-ticket purchases for as long as you own the item, to support warranty and insurance claims.

 

Keep Forever

Personal and family records like birth certificates, marriage license, divorce papers, Social Security cards, military discharge papers and estate-planning documents (power of attorney, will, trust and advanced directive). Keep these in a fireproof safe or safe-deposit box.

 

Reduce Your Paper

To reduce your paper clutter, consider digitizing your documents by scanning them and converting them into PDF files so you can store them on your computer and back them up onto a USB flash drive or external hard drive like icloud.com or carbonite.com.

Your can also reduce your future paper load by switching to electronic statements and records whenever possible.

 

 

Could You Have COPD?       
  
Jan. 27, 2016


Dear Savvy Senior,

I have struggled with some shortness of breath for the past five years or so. I just thought I was getting older and out of shape, but a friend recently mentioned I may have COPD.  What can you tell me about this?

Breathless Bob

 

Dear Bob,

COPD, or chronic obstructive pulmonary disease is a serious lung disease that, over time, makes it hard to breathe. What’s more, an estimated 24 million people have COPD today, but about half of them don’t know it.

Many people mistake shortness of breath as a normal part of aging, or a result of being out of shape, but that’s not necessarily the case. COPD - a term used to describe a variety of lung diseases including emphysema and chronic bronchitis - develops slowly, so symptoms may not be obvious until damage has occurred.

Common symptoms include: an ongoing cough or a cough that produces a lot of mucus; shortness of breath, especially during physical activity; wheezing; and chest tightness.

Those most at risk are smokers or former smokers over age 40, and people who have had long-term exposure to other lung irritants like secondhand smoke, air pollution, chemical fumes and dust. There is also a rare genetic condition known as alpha-1-antitrypsin, or AAT deficiency that can increase the risks.

If you’re experiencing any of the aforementioned symptoms, you need to get tested by your doctor. A simple breathing test called spirometry can tell if you have COPD, and if so, how severe it is. Early screening can also identify COPD before major loss of lung function occurs.

If you do indeed have COPD, you need to know that while there’s no cure, there are things you can do to help manage symptoms and protect your lungs from further damage, including:

- Quit smoking: If you smoke, the best thing you can do to prevent more damage to your lungs is to quit. To get help, the National Cancer Institute offers a number of smoking cessation resources at smokefree.gov or call 1-800-QUIT-NOW. Or ask your doctor about prescription antismoking drugs that can help reduce your nicotine craving.

- Avoid air pollutants: Stay away from things that could irritate your lungs like dust, allergens and strong fumes. Also, to help improve your air quality at home, remove dust-collecting clutter and keep carpets clean; run the exhaust fan when using smelly cleaning products, bug sprays or paint; ban smoking indoors; and keep windows closed when outdoor air pollution is high (see airnow.gov for daily air-quality reports).

- Guard against flu: The flu can cause serious problems for people who have COPD, so get a flu shot every fall and wash and sanitize your hands frequently to avoid getting sick. Also ask your doctor about getting the pneumococcal immunizations for protection against pneumonia.

- Take prescribed medications: Bronchodilators (taken with an inhaler) are commonly used for COPD. They help relax the airway muscles to make breathing easier. Depending on how severe your condition, you may need a short-acting version only for when symptoms occur, or a long-acting prescription for daily use. Inhaled steroids may also help reduce inflammation and mucus and prevent flare-ups.





 

How to Find Discounts for People with Disabilities         
Jan. 20, 2016


Dear Savvy Senior,

Are there any worthwhile discounts available to people with disabilities, and if so, how can I find them? My wife - who’s 48 - has Multiple Sclerosis that now requires her to use a wheelchair.

Need to Save

 

Dear Need,

There are actually a wide variety of discounts and services available to people with disabilities and those living with a chronic illness that can literally save you hundreds and even thousands of dollars each year. Here are some tips to help you find them.

 

Always Ask

The first thing to know is that most businesses that offer discounts to people with disabilities or their escorts don’t publicize them, so it’s important to always ask.

Also note that most nonprofit organizations and government agencies that provide disabled services or benefits will require proof of disability through a letter from your doctor or some other form of verification before they will accommodate you.

 

Search Locally

The disabled discounts available to your wife will vary depending on where you live, so a good place to start is to contact the local chapter of the nonprofit organization that specializes in your particular disease or disability - in your wife’s case that would be the National Multiple Sclerosis Society (nationalmssociety.org, 800-344-4867).

Local chapters often know where to find discounts on the medical supplies, mobility equipment and support services. Some organizations have even negotiated special discounted rates with suppliers, and a few even provide subsidized equipment directly.

To search for other disability or disease specific organizations, use any Internet search engine, any type in your disease or disability followed by organizations - for example “Arthritis Organizations” or “Hearing Loss Organizations.”

 

Search Online

DisabledDiscounts.com is one of the best resources for finding disabled discounts online. This is a free website that lists thousands of discounts in all 50 states. You search by state and county in 30 different categories ranging from assistive technology to federal and state tax discounts, entertainment to education and so much more.

Also visit Benefits.gov and BenefitsCheckUp.org, two great sites that will help you look for financial assistance programs your wife and you may be eligible for, and will tell you how to apply. And see Disability.gov, a site that connects people with disabilities to helpful programs and services in your area.

 

Types of Discounts

Here are a few examples of the different types of disabled discounts and services that are out there.  

- Recreation: Most movie theaters, museums, zoos, theme parks and aquariums provide reduced admission to people with disabilities or their escort. And, the National Park Service offers the “America The Beautiful Access Pass” (see nps.gov/findapark/passes.htm) to disabled residents, which provides a lifetime of free access into all national parks and federal recreational lands. 

- Taxes: There are numerous federal tax deductions and credits available to people with disabilities, and a number of states and counties also offer property tax deductions to disabled homeowners.

- Utilities: Many utility companies, including electric, gas, phone, water and trash services offer discounts to customers who are disabled, elderly or low income.

- Communication devices: 47 states have equipment distribution programs (see tedpa.org) that offer free amplified telephones to residents with hearing impairment.

Home modifications: There are a number of federal, state, local and nonprofit organizations that help pay for home accessibility improvements like wheelchair ramps, handrails and grab bars for elderly and disabled people in need.

- Travel: Amtrak offers a 15 percent rail fare discount to adult passengers with a disability and up to one traveling companion.

- Reading services: For those with vision or physical impairments that make it difficult for them to read, the Library of Congress (see loc.gov/nls) offers a “Talking Books” program that provides free audiobooks, magazines and audio equipment. And the National Federation of the Blind offers a free newspaper and magazine reading service at nfbnewslineonline.org.

 

 
 

How to Keep Tabs On an Elderly Parent with Video Monitoring        
Jan. 14, 2016


Dear Savvy Senior,

Can you recommend some good home video monitoring devices that can help my sister and me keep an eye on our elderly mother? Over the holidays, we noticed that her health has slipped a bit, and would like to keep a closer eye on her.

Worried Daughters

 

Dear Worried,

There are lot’s of great video monitoring cameras that can help families keep a watchful eye on an elderly parent from afar, but make sure it’s OK with your mom first. Many seniors find this type of “I’m watching you” technology to be an invasion of privacy, while others don’t mind and even welcome the idea. With that said, here are some top monitoring devices for keeping tabs on your mom.

 

Video Monitoring

As the technology has improved and the costs have come down, video monitoring/surveillance cameras have become very popular for keeping an eye on your home, business, child or pet (via smartphone, tablet or computer), but they also work well for monitoring an elder loved one who lives alone.

Most home video monitoring cameras today are sleek, small and easy to set up, but do require home Wi-Fi.

Although camera capabilities will vary, the best devices all provide wide-view angles, HD quality video, night vision, built-in motion and sound detection that can notify you when something is happening, and two-way audio that let’s you talk and listen.

And, they also offer a video recording option (for an extra fee) that saves past video to a cloud, so you can rewind and review what you missed.

One of the best products available today that does all this and more is the Nest Cam (nest.com), which costs $199, but if you want their video recording option, it’s an extra $100 per year for a 10-day video history, or $300/year for 30 days.

Also check out the Piper NV (getpiper.com), which - at $279 - is more expensive than the Nest Cam but allows free Internet cloud storage. And the Simplicam (simplicam.com), which is the cheapest of the three but the video quality isn’t quite as good. They charge $150 for the camera, or $200 for the camera plus 24-hour video storage for one year.

 

Sensor Monitoring

If your mom is uncomfortable with video monitoring, and doesn’t want you to be able to peek in on her whenever you want, another less invasive option to consider is a “sensor” monitoring system.

These systems use small wireless sensors (not cameras) placed in key areas of your mom’s home that can detect changes in her activity patterns, and will notify you via text message, email or phone call if something out of the ordinary is happening.

A great company that offers this technology is Silver Mother (sen.se/silvermother), which provides small sensors that you attach to commonly used household objects like her pillbox, refrigerator door, TV remote, front door, etc.

So, for example, if your mom didn’t pick up her pillbox to get her medicine or didn’t open the refrigerator door to make breakfast like she usually does, or if she left the house at a peculiar time you would be notified and could check on her. You can also check up on her anytime you want online or through their mobile app. Silver Mother costs $299 for four sensors, with no ongoing monthly service fees.






Paying Income Tax on Social Security Benefits    
  
Jan. 6, 2015

Dear Savvy Senior,

Will I have to pay federal income taxes on my Social Security benefits when I retire?

Approaching Retirement

 

Dear Approaching,

Whether or not you’ll be required to pay federal income tax on your Social Security benefits will depend on your income and filing status. About 35 percent of Social Security recipients have total incomes high enough to trigger federal income tax on their benefits.

To figure out if your benefits will be taxable, you’ll need to add up all of your “provisional income,” which includes wages, taxable and non-taxable interest, dividends, pensions and taxable retirement-plan distributions, self-employment, and other taxable income, plus half your annual Social Security benefits, minus certain deductions used in figuring your adjusted gross income.
 

How To Calculate

To help you with the calculations, get a copy of IRS Publication 915 “Social Security and Equivalent Railroad Retirement Benefits,” which provides detailed instructions and worksheets. You can download it at irs.gov/pub/irs-pdf/p915.pdf or call the IRS at 800-829-3676 and ask them to mail you a free copy.

After you do the calculations, the IRS says that if you’re single and your total income from all of the listed sources is:

*Less that $25,000, your Social Security will not be subject to federal income tax.

*Between $25,000 and $34,000, up to 50 percent of your Social Security benefits will be taxed at your regular income-tax rate.

*More than $34,000, up to 85 percent of your benefits will be taxed.
 

If you’re married and filing jointly and the total from all sources is:

*Less that $32,000, your Social Security won’t be taxed.

*Between $32,000 and $44,000, up to 50 percent of your Social Security benefits will be taxed.

*More than $44,000, up to 85 percent of your benefits will be taxed.

If you’re married and file a separate return, you probably will pay taxes on your benefits.

To limit potential taxes on your benefits, you’ll need to be cautious when taking distributions from retirement accounts or other sources. In addition to triggering ordinary income tax, a distribution that significantly raises your gross income can bump the proportion of your Social Security benefits subject to taxes.

 

How to File

If you find that part of your Social Security benefits will be taxable, you’ll need to file using Form 1040 or Form 1040A. You cannot use Form 1040EZ. You also need to know that if you do owe taxes, you’ll need to make quarterly estimated tax payments to the IRS or you can choose to have it automatically withheld from your benefits.

To have it withheld, you’ll need to complete IRS Form W-4V, Voluntary Withholding Request (irs.gov/pub/irs-pdf/fw4v.pdf), and file it with your local Social Security office. You can choose to have 7 percent, 10 percent, 15 percent or 25 percent of your total benefit payment withheld. If you subsequently decide you don’t want the taxes withheld, you can file another W-4V to stop the withholding.

 

State Taxation

In addition to the federal government, 13 states - Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, North Dakota, Rhode Island, Utah, Vermont and West Virginia - tax Social Security benefits to some extent too. If you live in one of these states, check with your state tax agency for details.

For questions on taxable Social Security benefits call the IRS help line at 800-829-1040, or visit an IRS Taxpayer Assistance Center (see www.irs.gov/localcontacts) where you can get face-to-face help.

 

 

Helping an aging parent with their finances       
Dec. 29, 2015


Dear Savvy Senior

Can you offer any tips on helping an elderly parent with their finances? My 82-year-old mother is having some trouble keeping up with her bills, and I just found out that she has been making a lot of small contributions to suspicious charities.

Concerned Daughter
 

Dear Concerned,

Millions of adult children today serve as financial helpers to their elderly or ill parents or other loved ones. They provide services like paying bills, handling deposits and investments, filing insurance claims, preparing taxes and more. Here are some tips and resources that can help you help your mom.

 

Have a talk

Taking on some or all of the financial responsibility of an elderly parent or other loved one can sometimes be awkward and difficult.

The first step in helping your mom is to have a thoughtful and respectful talk with her, expressing your concerns and offering your help in simplifying her financial life. If you have siblings, it can be a good idea to get them involved too. This can help you head off any possible hard feelings, plus, with others involved, your mom will know everyone is concerned.

 

Get organized

If your mom is willing to let you help manage her financial affairs your first order of business is to get organized by making a list of her financial accounts, and locate her important legal documents. This will help you get a handle on her overall financial situation and let you know if any key documents are missing. Your list should include her:

-Monthly bills: Phone, cable, water and trash, gas, electric, credit card accounts, etc.

-Financial accounts: Including bank accounts, brokerage and mutual fund accounts, safe-deposit boxes, and any other financial assets she has.

-Company benefits: Any retirement plans, pensions or health benefits from your current or former employer.

-Insurance policies: Life, home, auto, long-term care, Medicare, etc.

-Important legal documents: A will, advanced medical directive which includes a living will and health-care proxy, and durable power of attorney which gives one or more people the legal authority to handle her finances if she becomes incapacitated. Make sure these documents are prepared.

-Taxes: Copies of your mom’s income tax returns over the past few years.

-Contact list: Names and phone numbers of key contacts like insurance agents, financial advisor, tax preparer, family attorney, etc.

 

Seek advice

If your mom has considerable assets or a complex financial situation, you and your mom should sit down with her financial advisor or attorney to review her situation. If she doesn’t have anyone, consider hiring a reputable fee-only financial planner who can help you figure things out and put a smart plan in place. Fee-only planners do not earn commissions by selling you financial products. They charge only for their services, which can be around $150 to $300 an hour. To locate one in your area, visit napfa.org or garrettplanningnetwork.com.

 

Simplify financial tasks

One of the easiest ways to simplify your mom’s monthly financial chores is to set up automatic payments for her utilities and other routine bills, and arrange for direct deposit of her income sources. You can also make arrangements to have her bank statements mailed directly to you, so you can monitor what’s coming in and going out each month. Or, you could set up your mom’s online banking service (if available), so you can pay bills and monitor her account anytime.

For more tips on financial caregiving, the Consumer Financial Protection Bureau offers four guides on “Managing Someone Else’s Money” that you can read online at consumerfinance.gov/blog/managing-someone-elses-money.

If you need some help or live far away, you may want to consider hiring a daily money manager (aadmm.com, 877-326-5991) who can come in once or twice a month to pay bills, make deposits, decipher health insurance statements and balance her checkbook. Costs range between $50 and $150 per hour.

 



Pill splitting dos and don’ts     
  
Dec. 21, 2015


Dear Savvy Senior,

Is pill splitting safe? I have several friends who cut their pills in half in order to save money, but I have some concerns. What can you tell me?

Cautious Kim
 

Dear Kim,

Pill splitting - literally cutting them in half - has become a popular way to save on pharmaceutical costs but you need to talk to your doctor or pharmacist first, because not all pills can be split. 

The reason pill splitting is such a money saver is because of a quirk in the way drugs are manufactured and priced. A pill that’s twice as strong as another may not be twice the price. In fact, it’s usually about the same price. So, buying a double-strength dose and cutting it in half may allow you to get two months worth of medicine for the price of one. But is it safe? As long as your doctor agrees that splitting your pills is OK for you, you learn how to do it properly and you split only pills that can be split, there’s really no danger.
 

Ask Your Doctor

If you’re interested in splitting your pills, talk to your doctor or pharmacist to find out if any of the medicines you use can be safely split. It’s also important to find out whether splitting them will save you enough money to justify the hassle.

The pills that are easiest to split are those with a score down the middle. However, not every pill that’s scored is meant to be split. Pills that are most commonly split include:

-Cholesterol-lowering drugs, like Crestor, Lipitor, Mevacor, Pravachol and Zocor.

-Antidepressants, like Lexapro, Celexa, Serzone, Paxil and Zoloft.

-High blood pressure medicines such as, Accupril, Zestril, Diovan, Avapro, Norvasc, Tenormin, Toprol and Cardura.

-Erectile dysfunction pills, like Viagra, Cialis and Levitra.
 

Use a splitter

Having the right equipment is very important too. Don’t use a knife or scissors to cut your pills in half. It can cause you to split them unevenly resulting in two pieces with very different dosages, which can be dangerous. Purchase a proper pill cutter that has a cover and a V-shaped pill grip that holds the pill securely in place. You can find them at most pharmacies for $3 to $10.

For convenience, you might be tempted to split the whole bottle of pills at once. But it’s best to do the splitting on the day you take the first half, and then take the other half on the second day or whenever you are scheduled to take your next dose. That will help keep the drugs from deteriorating due to exposure to heat, moisture or air. It will also help ensure that any deviation in the size of one dose is compensated in the next. It’s also important to know that pills are only safely split in half, and never into smaller portions such as into thirds or quarters.
 

Don’t split these

Some pills should never be split. Drugs that are time-released or long-lasting and tablets that contain a combination of drugs probably shouldn’t be split, because it’s difficult to ensure a proper amount of active ingredient in each half. Pills with a coating to protect your stomach, and pills that crumble easily or irritate your mouth shouldn’t be split either, along with chemotherapy drugs, anti-seizure medicines, birth control pills and capsules containing powders or gels.

Again, your doctor or pharmacist will know which drugs can and cannot be split. If you’re taking a medicine that can be split, you’ll need to get a prescription from your doctor for twice the dosage you need. Then you can start splitting safely, and saving.

 

 


 

How to make your kitchen safer and easier to use         
Dec. 17, 2015


Dear Savvy Senior,

What tips can you recommend for making a kitchen senior-friendly? My wife, who loves to cook, has had several kitchen-related accidents over the past year, which is why we would like to modify to make it safer and more practical.

Hungry Husband
 

Dear Hungry,

There are a number of simple modifications and inexpensive add-ons that can make a big difference in making your kitchen more age-friendly. Depending on your wife’s needs, here are some tips for each aspect of the kitchen

- Floors: If you have kitchen throw rugs, to reduce tripping or slipping, replace them with non-skid floor mats or consider gel mats, which are cushiony and more comfortable to stand on for long periods. GelPro.com and WellnessMats.com offer a nice selection.

- Lights: If the lighting in her kitchen is dim, replace the old overhead fixture with a bright new ceiling light, and add under-cabinet task lighting to brighten up her kitchen countertops.

- Cabinets and drawers: To reduce bending or reaching, organize your kitchen cabinets and drawers so that the items you most frequently use are within comfortable reach. You can also make your cabinets and pantry easier to access by installing pullout shelves or lazy susans. And D-shaped pull-handles for the cabinets and drawers are also recommended because they’re more comfortable for arthritic hands to grasp than knobs.

- Faucet: If you have a twist-handle kitchen faucet, replace it with an ADA-compliant single-handle faucet. They’re easier to use, especially for seniors with arthritis or limited hand strength. There are also kitchen faucets on the market today (like the Delta Touch20 faucet and Moen MotionSense) that will turn themselves on and off by simply touching the base or moving your hand over a motion sensor. And, for safety purposes, set your hot water tank at 120 degrees to prevent possible water burns.

- Microwave and stove: If your microwave is mounted above the stove, consider moving it to a countertop. This makes it safer and easier to reach. And if you’re concerned about your wife remembering to turn the stove off, there are automatic stove shut-off devices you can purchase and install to prevent a fire. See cookstop.com, stoveguardintl.com and pioneeringtech.com for some different options.

If you’re looking to upgrade some of your appliances too, here are some different senior-friendly features you should look for when shopping:

- Refrigerator and freezer: Side-by-side doors work well for seniors because the frequently used items (refrigerated and frozen) can be placed at mid-shelf range for easy access. Pullout adjustable height shelves and a water/ice dispenser on the outside of door are also very convenient.

- Stove or cooktop: Look for one with controls in the front so you won’t have to reach over hot burners to turn it off, and make sure the controls are easy to see. Flat surface electric or induction burners, or continuous grates on gas stoves are also great for sliding heavy pots and pans from one burner to the next. And ask about automatic shut-off burners.

- Oven: Self-cleaning ovens are a plus, and consider a side-swing door model. They’re easier to get into because you don’t have to lean over a hot swing-down door. Also consider a wall-mounted oven, installed at your wife’s preferred height to eliminate bending.

- Dishwasher: Consider a dishwasher drawer that slides in and out, and is installed on a 6 to 10-inch raised platform. These require less bending to load and unload.

- Washer and dryer: Front-load washers and dryers with pedestals that raise the height 10 to 15 inches are also back-savers and easy to access.

 



How much you’ll pay for Medicare in 2016     
  
Dec. 9, 2015


Dear Savvy Senior,

I know there won’t be a cost-of-living increase in Social Security benefits next year but what about Medicare? I’ve heard some beneficiaries will get hit with a big Part B monthly premium increase in 2016. What can you tell me, and who will this affect? 

Planning Ahead

 

Dear Planning,

All things considered, the news regarding your Medicare costs next year is pretty good. For about 70 percent of the nation’s 52 million Medicare beneficiaries, there will be no Part B premium increase in 2016. And thanks to the 2015 Bipartisan Budget Act that was signed into law by President Barack Obama on Nov. 2, the other 30 percent will pay much less than previously projected. Here’s what you can expect.

 

Part B Premiums

Because the Social Security Administration will not be giving out a cost of living increase (or COLA) in 2016, the Medicare Part B premiums for most current beneficiaries will not go up either. Thanks to the “hold harmless” provision in the Medicare law, which prohibits Part B premiums from rising in any year that there’s no COLA, the 2016 monthly premium will remain at $104.90 for most current Medicare participants.

However, this provision does not protect new Medicare enrollees (those who enroll in 2016), beneficiaries who are directly billed for their Part B premium, or current beneficiaries who have deferred claiming their Social Security. This includes people 65 or older who are still working but have signed up for Medicare because their employer doesn’t offer health insurance. It also hits people who have filed and suspended Social Security benefits to allow a spouse to claim.

If you fit into any of these categories, your Medicare Part B premium will increase to $121.80 a month in 2016 - which is much lower than the $159.30 that it would have been, had the budget deal fell through.

The hold-harmless rule also does not protect high-income Medicare beneficiaries who already pay higher Part B premiums because their annual incomes are above $85,000 for an individual or $170,000 for a couple. If you fit into this category, here’s what you’ll pay for your Part B premium next year, based on your 2014 tax returns.

-Individuals with incomes of $85,000 to $107,000, or married couples filing joint tax returns with incomes of $170,000 to $214,000, will pay $170.50 per month.

-Individuals earning $107,000 to $160,000 (couples $214,000 to $320,000) will pay $243.60.

-Individuals with incomes of $160,000 to $214,000 (couples $320,000 to $428,000) will pay $316.70.

-Individuals over $214,000 or couples above $428,000 will pay $389.80.

Another increase high-income beneficiaries (those with incomes over $85,000, or $170,000 for joint filers) need to be aware of is the surcharge on Part D premiums. Affluent seniors that have a Medicare Part D prescription drug plan will pay an additional $12.70 to $72.90 per month, depending on their income, on top of their regular Part D premiums.

 

Deductibles and co-pays

Other changes you need to know about that will affect all Medicare beneficiaries include the Part B deductible, which will increase to $166 in 2016 (it’s currently $147); and the Part A (hospital insurance) annual deductible which will go up to $1,288 (it’s currently $1,260) for hospital stays up to 60 days. That increases to $322 per day for days 61-90, and to $644 a day for days 91 and beyond. And the skilled nursing facility coinsurance for days 21-100 will also increase to $161 per day (it’s currently $157.50).

For more information on all the Medicare costs for 2016 visit Medicare.gov and click on “Your Medicare Costs” tab at the top of the page, or call 800-633-4227.

 

 

Getting a lift    
  
Dec. 2, 2015


Dear Savvy Senior,

I am interested in purchasing a recliner that lifts and lowers off the ground, or some other type of senior-friendly furniture that can help my elderly father. He’s arthritic and overweight and struggles mightily with getting up from most of the cushioned furniture in the house. What can you recommend?

Need a Boost

 

Dear Need,

The task of sitting down and/or getting up from soft cushioned furniture is a problem for many seniors who struggle with excessive weight, arthritis or other mobility issues. Here are some different product solutions that can help.
 

Lift Recliners

One of the most popular types of cushioned furniture on the market today for mobility challenged seniors is an electric recliner lift chair. While they look just like regular recliners, powerlift recliners come with a built-in motor that raises and lowers the entire chair, which makes sitting down and getting up much easier.

With literally dozens of different types and styles of lift recliners to choose from, here are a few key points that can help you select a good fit for your dad.

• Chair size: The recliner needs to fit the person sitting in it, so your dad’s height and weight will determine the size of chair he needs.

• Reclining options: Aside from the lifting system, the degree in which the chair reclines is your choice too. Most lift recliners are sold as either two-position, three-position or infinite-position lift chairs. The two-position chairs recline only to about 45 degrees, which makes them ideal for watching TV or reading. But if your dad wants to nap, he’ll probably want a three-position or infinite-position chair that reclines almost completely horizontally.

• Style and features: You’ll also need to choose the type of fabric, color and back style you want the chair to be, or if you want any extra features like built-in heating or massage elements, or a wall hugging chair which is great if you’re tight on space. 

While there are many companies that make lift recliners — such as Med-Lift, NexIdea, Catnapper, Berkline, Franklin and La-z-boy — Pride Mobility (pridemobility.com) and Golden Technologies (goldentech.com) have been around the longest and have some of the best reputations. With prices typically ranging between $600 and $2,000, you can find lift recliners at many medical supply stores and online.

You’ll also be happy to know that Medicare provides some help purchasing a lift chair. They cover the lift mechanism portion, which equates to around $300 towards your purchase.

 

Risedale Chairs

If powerlift recliners don’t appeal to your dad, another option to consider is a Risedale chair. These are open-legged, wing back chairs that are different from lift recliners because only the seat cushion lifts instead of the whole chair. Sold by Carex Health Brands (carex.com), the Risedale costs $725.

 

Furniture Adapters

If you’re looking for something less expensive, or if your dad doesn’t want different furniture, there are also a number of assistive products that can be added to his current furniture that can help too, like the Stander CouchCane or EZ Stand-N-Go (see stander.com).

These products provide support handles that make sitting down and standing up a little easier, and they both work on couches and recliners. Available online at Amazon.com, the CouchCanes sell for around $110, and the EZ Stand-N-Go costs $129.

Another way to make your dad’s furniture more accessible is by increasing its height with furniture risers. These typically range from 2 to 5 inches in height, are made of heavy-duty plastic or wood, and are inserted under the base of the legs or supports of his furniture. Costs typically range from a few dollars up to $50 or more and can be purchased at retail stores like Walmart and Target, or online at Amazon.com.






How to Guard Against Deadly Aortic Aneurysms    
  
Nov. 27, 2015


Dear Savvy Senior,

My father died several years ago, at the age of 76, from a stomach aneurysm, which now has me wondering. What are my risk factors of getting this, and what can I do to protect myself, as I get older?

Just Turned 60

Dear 60,

Stomach aneurysms, also known as “abdominal aortic aneurysms,” are very dangerous and the third leading cause of death in men over 60. They also tend to run in families, so having had a parent with this condition makes you much more vulnerable yourself.

An abdominal aortic aneurysm (or AAA) is a weak area in the lower portion of the aorta, which is the major artery that carries blood from the heart to the rest of the body. As blood flows through the aorta, the weak area bulges like a balloon and can burst if it gets too big, causing life-threatening internal bleeding. In fact, nearly 80 percent of AAAs that rupture are fatal, but the good news is that more than nine out of 10 that are detected early are treatable.

 

Who’s At Risk?

Around 200,000 people are diagnosed with AAAs each year, but estimates suggest that another 2 million people may have it but not realize it. The factors that can put you at increased risk are: 

• Smoking: Ninety percent of people with an AAA smoke or have smoked. This is the number one risk factor and one you can avoid.

• Age: Your risk of getting an AAA increases significantly after age 60 in men, and after age 70 in women.

• Family history: Having a parent or sibling who has had an AAA can increase your risk to around one in four.

• Gender: AAAs are five times more likely in men than in women.

• Health factors: Atherosclerosis, also known as hardening of the arteries, high blood pressure and high cholesterol levels also increase your risk.

 

Detection and Treatment

Because AAAs usually start small and enlarge slowly, they rarely show any symptoms, making them difficult to detect. However, large AAAs can sometimes cause a throbbing or pulsation in the abdomen, or cause abdominal or lower back pain.

The best way to detect an AAA is to get a simple, painless, 10-minute ultrasound screening test. All men over age 65 that have ever smoked, and anyone over 60 with a first-degree relative (father, mother or sibling) who has had an AAA should talk to their doctor getting screened.

You should also know that most health insurance plans cover AAA screenings, as does Medicare to beneficiaries with a family history of AAAs, and to men between the ages of 65 and 75 who have smoked at least 100 cigarettes during their life.

If an AAA is detected during screening, how it’s treated will depend on its size, rate of growth and your general health. If caught in the early stages when the aneurysm is small, it can be monitored and treated with medication. But if it is large or enlarging rapidly, you’ll probably need surgery.

 

AAA Protection

While some risk factors like your age, gender and family history are uncontrollable, there are a number of things you can do to protect yourself from AAA. For starters, if you smoke, you need to quit – see smokefree.gov or call 1-800-QUIT-NOW for help.

You also need to keep tabs on your blood pressure and cholesterol levels, and if they are high you need to take steps to lower them through diet, exercise and if necessary, medication.

 

 

Required IRA and 401(k) withdrawal rules for retirees      
Nov. 18, 2015


Dear Savvy Senior,

Can you give me the details on required IRA and 401(k) distributions? I turned 70 this year, and want to be clear on what I’m required to do, and when I’ll have to do it.

Planning Ahead

 

Dear Planning,

The old saying “you can’t take it with you” is definitely true when it comes to Uncle Sam and your tax-deferred retirement accounts. Here’s what you should know about required retirement account distributions along with some tips to help you avoid extra taxes and penalties:
 

— RMD Rules

Beginning at age 70½, the IRS requires all seniors that own tax-deferred retirement accounts – like traditional IRAs, SEP IRAs, SIMPLE IRAs, SARSEPs, 401(k)s, 403(b)s and 457s – must start taking annual required minimum distributions (RMDs), and pay taxes on those withdrawals. The reason: The IRS doesn’t want you hoarding your money in these accounts forever. They want their cut. Distributions are taxed as income at your ordinary income tax rate.

There are, however, two exceptions. Owners of Roth IRAs are not required to take a distribution, unless the Roth is inherited. And if you continue to work beyond age 70½, and you don’t own 5 percent or more of the company you work for, you can delay withdrawals from your employer’s retirement plan until after you retire. But if you have other non-work-related accounts, such as a traditional IRA or a 401(k) from a previous employer, you are still required to take RMDs from them after age 70½, even if you’re still working.

 

— RMD Deadlines

Generally, you must take your distribution every year by Dec. 31. First timers, however, can choose to delay taking their distribution until April 1 of the year following the year you turn 70½. So, for example, if your 70th birthday was in March 2015, you would turn 70½ in September and your required beginning date would be April 1, 2016. But if your 70th birthday occurred later in the year, say in August, you wouldn’t turn 70½ until 2016. In that case, you would be required to take your first distribution by April 1, 2017.

But be careful about delaying, because if you delay your first distribution, it may push you into a higher tax bracket because you must take your next distribution by December 31 of the same year.

Also note that you can always withdraw more than the required amount, but if you don’t take out the minimum, you’ll be hit with a 50 percent penalty on the amount that you failed to withdraw, along with the income tax you owe on it.

 

— Distribution Amounts

Your RMD is calculated by dividing your tax-deferred retirement account balance as of Dec. 31 of the previous year, by an IRS estimate of your life expectancy. A special rule applies if your spouse is the beneficiary and is more than 10 years younger than you.

IRA withdrawals must be calculated for each IRA you own, but you can withdraw the money from any IRA or combination of IRAs. 403(b) accounts also allow you to total the RMDs and take them from any account or combination of accounts.

With 401(k) plans, however, you must calculate the RMD for each plan and withdraw the appropriate amount from each account.

To calculate the size of your RMD, you can use the worksheets on the IRS website – see irs.gov/Retirement-Plans and click on “Required Minimum Distributions.” Or, contact your IRA custodian or retirement-plan administrator who can do the calculations for you.

For more information, call the IRS at 800-829-3676 and ask them to mail you a free copy of the “Distributions from Individual Retirement Arrangements” (publication 590-B), or see irs.gov/pub/irs-pdf/p590b.pdf.

 

 

How to choose a good nursing home    
  
Nov. 11, 2015


Dear Savvy Senior,

Can you give me some tips on picking a good nursing home for my mother who has Alzheimer’s disease? I’ve been taking care of her at home, but she’s gotten to the point where she’s too much for me to handle.

Overwhelmed Daughter
 

Dear Overwhelmed,

Choosing a good nursing home for a loved one with Alzheimer’s disease is a very important decision that requires careful evaluation and some homework. Here are some steps that can help you find a good facility and avoid a bad one: 

- Make a list: There are several sources you can turn to for referrals to nursing homes in your area: Your Area Agency on Aging (call 800-677-1116 for contact information); your mom’s doctor or nearby hospital discharge planner; or friends, family or neighbors who may have had a loved one in a nursing home. Ideally, the nursing homes should be close to family members and friends who can visit often, because residents with frequent visitors usually get better care.

- Compare nursing homes: To research and compare the nursing homes on your list, use Medicare’s nursing home compare tool at medicare.gov/nursinghomecompare. This tool provides a 5-star rating system on recent health inspections, staffing, quality of care, and overall rating.

You should also contact your local long-term care ombudsman. This is a government official who investigates nursing home complaints and can tell you which ones have had problems in the past. To find your local ombudsman, call your Area Agency on Aging or see ltcombudsman.org.

- Contact the facilities: Once you’ve narrowed your search, call the nursing homes you’re interested in to verify that they have a dementia unit that can facilitate your mom’s needs. Also, find out if they have any vacancies, what they charge, and if they accept Medicaid.

- Tour your top choices: During your nursing home visit, notice the cleanness and smell of the facility. Is it homey and inviting? Does the staff seem responsive and kind to its residents? Also be sure to taste the food, and talk to the residents and their family members, if available. It’s also a good idea to visit several times at different times of the day and different days of the week to get a broader perspective.

Also, find out about their staff screening (do they do background checks) and training procedures, staff-to-patient ratio, and the staff turnover rate.

To help you rate your visit, Medicare offers a helpful checklist of questions to ask at medicare.gov/nursinghomecompare/checklist.pdf, as does the Alzheimer’s Association at alz.org/visitinganursinghome.pdf. Print these lists from your computer and take them with you on your visit.

- Paying for care: With nursing home costs now averaging $250 per day nationally for a private room, paying for care is another area you may have questions about or need assistance with. Medicare only helps pay up to 100 days of rehabilitative nursing home care, which must occur after a hospital stay.

Most nursing home residents pay for care from either personal savings, a long-term care insurance policy, or through Medicaid once their savings are depleted.

The National Clearinghouse for Long-Term Care Information website (longtermcare.gov) is a good resource that can help you understand and research your financial options. You can also get help from your State Health Insurance Assistance Program (SHIP), which provides free counseling on all Medicare and Medicaid issues. To find a local SHIP counselor visit shiptacenter.org, or call 800-677-1116.

For more information, see Medicare’s online booklet “Your Guide to Choosing a Nursing Home” at medicare.gov/publications/pubs/pdf/02174.pdf.

 

 

Understanding Reverse Mortgages: Beware of Misleading Ads      
Nov. 4, 2015


Dear Savvy Senior,

Can you give us a rundown of how reverse mortgages work? I’ve see actors Fred Thompson and Henry Winkler pitching them on TV, and they sound like a good deal. What can you tell me?

Need the Money

 

Dear Need,

When it comes to celebrity spokespeople pitching reverse mortgages on TV, don’t believe everything you hear. Many of these ads are misleading and don’t always give you the whole story. In fact, the Consumer Financial Protection Bureau recently issued a warning to seniors to watch out for these deceptive advertisements. With that said, here’s the lowdown on reverse mortgages.
 

The Basics

A reverse mortgage is a unique type of loan that allows older homeowners to borrow money against the equity in their house that doesn’t have to be repaid until the homeowner dies, sells the house or moves out for at least 12 months. At that point, you or your heirs will have to pay back the loan plus accrued interest and fees, but you will never owe more than the value of the house.

It’s also important to understand that with a reverse mortgage, you, not the bank, own the house, so you’re still required to pay your property taxes and homeowners insurance. Not paying them can result in foreclosure.

To be eligible, you must be at least 62 years old, own your own home (or owe only a small balance) and currently be living there.

You will also need to undergo a financial assessment to determine whether you can afford to continue paying your property taxes and insurance. Depending on your financial situation, you may be required to put part of your loan into an escrow account to pay future bills. If the financial assessment finds that you cannot pay your insurance and taxes and have enough cash left to live on, you’ll be denied.
 

Loan Details

Around 95 percent of all reverse mortgages offered today are Home Equity Conversion Mortgages (HECM), which are FHA insured and offered through private mortgage lenders and banks. HECM’s also have home value limits that vary by county, but cannot exceed $625,500.

How much you can actually get through a reverse mortgage depends on your age, your home’s value and the prevailing interest rates. Generally, the older you are, the more your house is worth, and the lower the interest rates are, the more you can borrow. A 70-year-old, for example, with a home worth $250,000 could borrow around $136,000 with a fixed-rate HECM. To estimate how much you can borrow, use the reverse mortgage calculator at reversemortgage.org.

You also need to know that reverse mortgages are expensive with a number of fees, including: a 2 percent lender origination fee for the first $200,000 of the home’s value and 1 percent of the remaining value, with a cap of $6,000; a 0.5 percent upfront mortgage insurance premium (MIP) fee, plus an annual MIP fee that’s equal to 1.25 percent of the outstanding loan balance; along with an appraisal fee, closing costs and other miscellaneous expenses. Most fees can be deducted for the loan amount to reduce your out-of-pocket cost at closing.

To receive your money, you can opt for a lump sum, a line of credit, regular monthly checks or a combination of these. But in most cases, you cannot withdraw more than 60 percent of the loan during the first year. If you do, your upfront MIP fee will be bumped up to 2.5 percent.

 

Get Educated

To learn more, read the National Council on Aging’s online booklet “Use Your Home to Stay at Home,” which you can download at homeequityadvisor.org.

Also note that because reverse mortgages are complex loans, all borrowers are required to get face-to-face or telephone counseling through a HUD approved independent counseling agency before taking one out. Most agencies charge around $125 to $250. To locate one near you, visit go.usa.gov/v2H, or call 800-569-4287.

 

 

 

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