As I noted in previous blog posts, immediate annuities are a financial device that many of us ought to seriously consider in order to ensure a life time stream of income so as not to outlive our money - say stashed in an IRA. Recall also what the AARP Bulletin reported in July of 2012. . According to A. Barry Rand ('Financial Capability', p. 38):
"Half of those working have no sense of how much savings they will need in retirement. According to the Center for Retirement Research at Boston College, almost 44% of working households, ages 36 to 62, are at risk of having insufficient savings for their retirement years. This puts even greater pressure on national retirement systems that already face insolvency challenges."
One answer proposed was immediate fixed annuities..
The problem is that getting such an annuity requires turning over a large stash of your money in one lump sum to obtain a monthly income. Right now, for example, checking at the website:
http://www.immediateannuities.com/
One learns that a 55 year old man paying out $100,000 can obtain an immediate fixed annuity for roughly $5,772 a year or $481 a month.
However, we have now learned "longevity policies" are being aggressively touted - that is annuities that don't pay immediately but much later. (Denver Post, Aug. 24, 'Insurance Against Outliving Your IRA'). Typically these start paying out at age 75, when one would receive $24,192 a year. Even better would be waiting until age 85 when you'd receive $81, 936 a year.
But before you begin considering the last, bear in mind the actuarial tables for Social Security which show the typical American at age 55 has only 28.65 years of life expectancy left - and even less for males (about 14.5 years.) So the odds are that despite all the financial hubbub about living to or past 90, the average male will have long since gone quietly into that good night by then. And what happens to the 100 grand you used to purchase the policy? Well, the insurance company keeps your money!
While longevity annuities sound like a terrific idea on the surface, one would be advised to think very carefully before any purchase. In particular, what exact chances do you put on living until 75 (or 85) to collect your big payout? What is your family health history and life expectancy of your parents? If you're not confident in living that long it may be better not to be so greedy and instead take the lesser yearly amounts in a standard immediate annuity. I mean, look, even the standard immediate annuity for the 55 year old will pile up a total of $173, 160 before he could make his first collection at 85 for a longevity version. To me, the odds warrant that choice instead of grabbing for the big $81- odd grand payout and croaking before you get it!
Of course, for normal annuities it is therefore wise to incorporate a death benefit - so if one spouse dies earlier than expected at least the other can get something. Ordinarily this means a drop in the inflation-adjusted income - in the article I cited (Denver Post, ibid.) a drop from 5.9% to 5.4% is cited. What can counterbalance this loss is at least deferring Social Security until age 70.
It also goes without saying, but I will, that to protect your annuity investment you should only go to an insurer with a triple A rating. (Some advisors say 'double A' should be the limit - but call me cautious!)
As we learn more of how difficult it will be for people in retirement, and the numerous attacks being mounted on Social Security, Americans would be well advised to consider annuities in providing a stream of income in later years - even to supplement their Social Security.
Showing posts with label immediate fixed annuities. Show all posts
Showing posts with label immediate fixed annuities. Show all posts
Sunday, September 14, 2014
Sunday, July 29, 2012
Karen Klein About to Retire? Maybe!
Karen Klein: Let's hope she really retires and doesn't change her mind!Three cheers for former school bus aide Karen Klein, who after a nasty bullying incident back in June (in Greece, NY) made international headlines, and has since collected over $703,000 in a special fund set up on Indiegogo.com (by Max Sidirov, 25, from Toronto). Sidirov initially set up the site to raise just $5,000 to send Klein "on a much deserved vacation". that threshold was quickly passed . Given the new total, Karen now evidently plans to finally retire.
I had actually advised her do just that when the total was barely three-fifths of what it is now. I also noted in that situation she could go on vacation just about any time she desired.. Therein also I emphasized she could have a comfortable retirement using only a portion of her money to fund immediate fixed annuities which would provide her a steady, safe income for life. I even gave the website to go to: http://www.immediateannuities.com/
The above site is really useful for anyone 62 or over, who doesn't wish to risk money in the stock market, and for which different annual income amounts can be generated based on location, age, and the duration of the annuity. (Shorter annuities, e.g. 10, 15 years, are available which will generate more income per month - assuming you will only live that much longer or can find supplemental income down the line.)
Given her whopping new total collected, and what she plans to do with it all, Karen has stated that:
“I want to save some, I want to invest in some things to make it grow, and donate to a couple of groups that I have in mind,” according to The National Post
I would at this point, just warn her to beware of "investing to make it grow" when the economic climate we inhabit is not one to support that. Sadly, every type of financial huckster will also want to share in her new found riches, and that means promising her almost anything - but which is likely fraudulent - given today's low demand environment. Hence, I advise Karen again, as I did before, to put away the "growth" game - say for stocks (phantom money) or even CDs promising 5-6% per annum, and stick to the tried and true immediate annuities - which will assure that she won't have to come back at any point begging for her job.
Charity donations, up to a point, are fine and we know Klein has a granddaughter with Down syndrome and a grandson with autism, ensuring she will likely use some of the money to donate to organizations that help those causes.
Karen denies in the sundry press reports that she's retiring because of the odious kids that harassed her on the bus, including sarcastic and nasty comments about her son who committed suicide. Maybe this is so, but I'd warrant - given the accounts heard from many similar people who've retired from analogous positions, that the nature of the job just lost its appeal. The incident on the bus was then simply a "bridge too far" or the "straw that broke the camel's back". Pick whatever hackneyed, recycled saying you want. Karen, bottom line, had reached her 'nuff of this shit' limit - which all of us have. So no, it probably wasn't that single incident but the cumulative toll of lots of minor incidents culminating in that one.
In the end, the reason doesn't matter, what matters is that she's really going to retire. To that end, may I also offer one more piece of advise?
Please complete the paperwork that makes it official! According to the same press reports, Karen has dilly-dallied and still has not submitted the paperwork up to the time of this blog. This isn't sanguine, and makes me wonder if in fact Karen hasn't truly finalized her decision or cut it in stone. Leaving a loose end, and such a glaring one, is not a good omen.
Go for it, Karen! Get the damned paperwork done and make that retirement REAL! The last thing we want is to see you sitting on that bus again, taking crap from a bunch of diminutive congenital losers! And - if you allow yourself to do that- there won't be much sympathy next time.
So - TWO things:
1) Get yourself several laddered immediate fixed annuities and forget those "growth" investments (by the way I will offer you a test to see if you are really ready to make stock, mutual fund investments) and
2) Complete the paperwork and get it submitted to make the retirement official.
You now have the time and moola to go to Hawaii where you indicated an interest for extended vacation. Take it and don't step back into that school district with those ingrates!
Tuesday, July 10, 2012
Immediate Annuities Remain The Best Bet to Secure A Decent Retirement
The recent (July-August) AARP Bulletin carried ominous news for Americans near to or planning retirement. According to A. Barry Rand ('Financial Capability', p. 38):
"Half of those working have no sense of how much savings they will need in retirement. According to the Center for Retirement Research at Boston College, almost 44% of working households, ages 36 to 62, are at risk of having insufficient savings for their retirement years. This puts even greater pressure on national retirement systems that already face insolvency challenges."
The last especially comes to mind as President Obama is once again hoist on the Bush Tax cuts petard, challenging the Repubs to allow those tax cuts to expire for the wealthiest, but allowing the "middle class" cuts to remain (e.g. for those earning $250,000 or less a year.) But as we know, this is not a serious economic proposal but political gamesmanship. It might energize a few of the base, but isn't a long term economic strategy. In fact as I've blogged on before,
http://brane-space.blogspot.com/2010/12/bushs-revenge-or-how-zombie-tax-cuts.html
ALL the BUSH TAX CUTS need to go!
We need that total allottment of money saved not only to pay for implementation of Mr. Obama's health care reform plan (especially expanding Medicaid, and especially as the SC ruled the mandate is only allowable under the government's tax authority), but to sustain the health of those "national retirement systems", e.g. Social Secuity and Medicare, that the AARP author indicates will be under more pressure on account of inadequate American saving.
Mr. Obama said in a speech Monday:
"Let's not hold the vast majority of Americans and our economy hostage while we debate the merits of another tax cut for the wealthy"
But that is exactly what we are doing! We are doing it by: 1) Playing on the Republican perpetual tax cut wicket, hence allowing them to control the economic narrative 2) engendering less revenues and higher deficits the next ten years - which will then demand severe cuts to Social Security, Medicare, Medicaid and even basic benefits like food stamps.
This is a false choice. The middle class, in any case, will be held hostage to Simpson-Bowles (the Obama Deficit Commission, or some other mutant commission hatched by Romney) and having major future benefits cut, perhaps by adjustment of the S.S. COLA or raising premiums for Medicare, if not also the age threshold (to 67). Thus, rather than play this absurd political game with the toxic Bushie tax cuts, Obama needs to come clean and ask people what they want: minor tax cut benefits for a year or two (or likely more) , or preserving their Social Security and Medicare? They cannot have both and politicians, no matter how much they want to game this, ought not let their constituents believe so.
As today's Denver Post editorial put it (p. 17A):
"We have no objection in principle to the wealthy paying more. However, the point is not to punish the wealthy, it's to put the federal budget on a sound footing...that simply can't be done through tax hikes on the wealthy alone."
Which is exactly correct and the numbers don't lie. By GAO reckoning, hitting the wealthy alone (though it may feel good and perceived as politically advantageous) will save $700 billion over ten years. Repealing the tax cuts for everyone will save $3.7 TRILLION. That is enough to accomplish a lot, and spare middle class retirees from the future deficit-incited axe to the federal budget that Obama doesn't mention as a consequence of his tax-cut decoupling extension politics. (And we already know from the last time this farce played out two years ago, the Reeps won't go for it. So it will be 'all or nothing' and once more a one or two year extension,... possibly leading to a permanent extension of these insane tax cuts if Romney is elected....paid for by gutting all social programs)
People need to wake up to this and stop blinding themselves to how the tax cuts are actually terrible for our economy. Since I've already exposed the false nature of all tax cuts and any "benefits" for our economy (including jobs) , see e.g.
http://brane-space.blogspot.com/2012/06/no-therell-be-no-tax-amageddon-or.html
I want to focus on the financial strategies to adopt if our politicos go down this horrid path once again, risking the future retirement security of millions and threatening to make the nation a permanent hostage to bond traders and rating agencies (Greece anyone?). As I noted earlier, in proposing my retirement solution (which I seriously hope she adopted) for former bus driver Karen Klein,
http://brane-space.blogspot.com/2012/06/advice-to-karen-klein-take-money-and.html
the answer is immediate fixed annuities. Let us say that (under a worst case scenario) Mitt Romney is elected in November and on taking office one of his first acts - aided and abetted by a total Reep congress - is to make the Bush tax cuts permanent. This will mean adopting a rigorous Ryan-style budget and cutting Social Security (probably by altering its COLA, so seniors can no longer remotely keep up with inflation) and also voucherizing Medicare, which, contrary to Reepo spin, will also affect the costs for current beneficiaries. I estimate the total hit from all these cuts may be as large as $10,000 a year for each retiree. Maybe a third of the added cost will come from the S.S. COLA change, a third from raising the Medicare premiums or age to receive it or both, and a third will come from further Medicare privatization, generating much larger co-pays, and higher costs for certain interventions, from hip replacements to prostatectomies. (As well as putting a ceiling cost on such procedures, say of $5,000 each with the patient to pay the rest.)
This means at least $10,000 more in annual income will be needed on top of what is already received. In years past, of course, people were led into the stock market, but as the recent (May) Kiplinger Retirement Report noted, those days are gone. Before, given a portfolio of "60% in stocks, 40% in bonds you could withdraw 4% of your assets initially and increase that in subsequent years to keep pace with inflation. Such a strategy offered a 90% probability of not outliving your money over a 30-year retirement."
As Kiplinger then noted, that probability was fine so long as the stock market was growing or bonds performed well when stocks took a hit, but it was exposed as useless in the wake of the 2008 market meltdown when ALL asset classes were clobbered. In fact, the equities market has been essentially flat since 2000. Bonds (i.e. bond funds) have mainly been exposed as fraudulent, often marked AAA by unscrupulous ratings agencies when they were actually at junk level. (BB or below, because of harboring 'toxic waste' like credit default swaps.)
The alternative now proposed, instead of attempting to get rich quick with huge returns via equities or bond investments, is to use immediate fixed annuities. I already provided a link in the previous cite for my Karen Klein blog but for those who'd like to see or get an instant estimate of different immediate fixed annuities for differing amounts and ages, go to:
http://www.immediateannuities.com/
According to Kiplinger's, for a 65-year old man in Virginia who wants to spend a total of $300,000 on an immediate annuity the payback now is $1,737 a month. This would add up to more than $20,000 of added income per year, or more than enough to cover the increased costs of social benefits arising from the advent of the deficit mongers....if the tax cut mavens can't halt their addiction to the Bush tax cuts.
I encourage readers to play with the immediate annuities link - plugging in different amounts- and try to determine what they'd need to invest in a single fixed annuity to generate an additonal $10,000 a year of income for life. Another piece of advice given in the Kiplinger Report is worth repeating:
"Consider buying products from several insurance companies to spread your risk if one of the insurance companies goes under."
This strategy then is one of "laddering" to hedge your bets. I also invite readers to try to ladder a set that would also deliver $10k a year for their needs.
Remember, folks, as long as our politicos are playing the odious tax cut game your future benefits WILL be cut - those cuts will have to pay for your temporary piddling tax cuts. Only someone living in Financial Fantasyland will not see this. It is your job to be proactive and seek to protect yourself now, since you obviously won't be able to depend on our tax cut hostage government to do so!
"Half of those working have no sense of how much savings they will need in retirement. According to the Center for Retirement Research at Boston College, almost 44% of working households, ages 36 to 62, are at risk of having insufficient savings for their retirement years. This puts even greater pressure on national retirement systems that already face insolvency challenges."
The last especially comes to mind as President Obama is once again hoist on the Bush Tax cuts petard, challenging the Repubs to allow those tax cuts to expire for the wealthiest, but allowing the "middle class" cuts to remain (e.g. for those earning $250,000 or less a year.) But as we know, this is not a serious economic proposal but political gamesmanship. It might energize a few of the base, but isn't a long term economic strategy. In fact as I've blogged on before,
http://brane-space.blogspot.com/2010/12/bushs-revenge-or-how-zombie-tax-cuts.html
ALL the BUSH TAX CUTS need to go!
We need that total allottment of money saved not only to pay for implementation of Mr. Obama's health care reform plan (especially expanding Medicaid, and especially as the SC ruled the mandate is only allowable under the government's tax authority), but to sustain the health of those "national retirement systems", e.g. Social Secuity and Medicare, that the AARP author indicates will be under more pressure on account of inadequate American saving.
Mr. Obama said in a speech Monday:
"Let's not hold the vast majority of Americans and our economy hostage while we debate the merits of another tax cut for the wealthy"
But that is exactly what we are doing! We are doing it by: 1) Playing on the Republican perpetual tax cut wicket, hence allowing them to control the economic narrative 2) engendering less revenues and higher deficits the next ten years - which will then demand severe cuts to Social Security, Medicare, Medicaid and even basic benefits like food stamps.
This is a false choice. The middle class, in any case, will be held hostage to Simpson-Bowles (the Obama Deficit Commission, or some other mutant commission hatched by Romney) and having major future benefits cut, perhaps by adjustment of the S.S. COLA or raising premiums for Medicare, if not also the age threshold (to 67). Thus, rather than play this absurd political game with the toxic Bushie tax cuts, Obama needs to come clean and ask people what they want: minor tax cut benefits for a year or two (or likely more) , or preserving their Social Security and Medicare? They cannot have both and politicians, no matter how much they want to game this, ought not let their constituents believe so.
As today's Denver Post editorial put it (p. 17A):
"We have no objection in principle to the wealthy paying more. However, the point is not to punish the wealthy, it's to put the federal budget on a sound footing...that simply can't be done through tax hikes on the wealthy alone."
Which is exactly correct and the numbers don't lie. By GAO reckoning, hitting the wealthy alone (though it may feel good and perceived as politically advantageous) will save $700 billion over ten years. Repealing the tax cuts for everyone will save $3.7 TRILLION. That is enough to accomplish a lot, and spare middle class retirees from the future deficit-incited axe to the federal budget that Obama doesn't mention as a consequence of his tax-cut decoupling extension politics. (And we already know from the last time this farce played out two years ago, the Reeps won't go for it. So it will be 'all or nothing' and once more a one or two year extension,... possibly leading to a permanent extension of these insane tax cuts if Romney is elected....paid for by gutting all social programs)
People need to wake up to this and stop blinding themselves to how the tax cuts are actually terrible for our economy. Since I've already exposed the false nature of all tax cuts and any "benefits" for our economy (including jobs) , see e.g.
http://brane-space.blogspot.com/2012/06/no-therell-be-no-tax-amageddon-or.html
I want to focus on the financial strategies to adopt if our politicos go down this horrid path once again, risking the future retirement security of millions and threatening to make the nation a permanent hostage to bond traders and rating agencies (Greece anyone?). As I noted earlier, in proposing my retirement solution (which I seriously hope she adopted) for former bus driver Karen Klein,
http://brane-space.blogspot.com/2012/06/advice-to-karen-klein-take-money-and.html
the answer is immediate fixed annuities. Let us say that (under a worst case scenario) Mitt Romney is elected in November and on taking office one of his first acts - aided and abetted by a total Reep congress - is to make the Bush tax cuts permanent. This will mean adopting a rigorous Ryan-style budget and cutting Social Security (probably by altering its COLA, so seniors can no longer remotely keep up with inflation) and also voucherizing Medicare, which, contrary to Reepo spin, will also affect the costs for current beneficiaries. I estimate the total hit from all these cuts may be as large as $10,000 a year for each retiree. Maybe a third of the added cost will come from the S.S. COLA change, a third from raising the Medicare premiums or age to receive it or both, and a third will come from further Medicare privatization, generating much larger co-pays, and higher costs for certain interventions, from hip replacements to prostatectomies. (As well as putting a ceiling cost on such procedures, say of $5,000 each with the patient to pay the rest.)
This means at least $10,000 more in annual income will be needed on top of what is already received. In years past, of course, people were led into the stock market, but as the recent (May) Kiplinger Retirement Report noted, those days are gone. Before, given a portfolio of "60% in stocks, 40% in bonds you could withdraw 4% of your assets initially and increase that in subsequent years to keep pace with inflation. Such a strategy offered a 90% probability of not outliving your money over a 30-year retirement."
As Kiplinger then noted, that probability was fine so long as the stock market was growing or bonds performed well when stocks took a hit, but it was exposed as useless in the wake of the 2008 market meltdown when ALL asset classes were clobbered. In fact, the equities market has been essentially flat since 2000. Bonds (i.e. bond funds) have mainly been exposed as fraudulent, often marked AAA by unscrupulous ratings agencies when they were actually at junk level. (BB or below, because of harboring 'toxic waste' like credit default swaps.)
The alternative now proposed, instead of attempting to get rich quick with huge returns via equities or bond investments, is to use immediate fixed annuities. I already provided a link in the previous cite for my Karen Klein blog but for those who'd like to see or get an instant estimate of different immediate fixed annuities for differing amounts and ages, go to:
http://www.immediateannuities.com/
According to Kiplinger's, for a 65-year old man in Virginia who wants to spend a total of $300,000 on an immediate annuity the payback now is $1,737 a month. This would add up to more than $20,000 of added income per year, or more than enough to cover the increased costs of social benefits arising from the advent of the deficit mongers....if the tax cut mavens can't halt their addiction to the Bush tax cuts.
I encourage readers to play with the immediate annuities link - plugging in different amounts- and try to determine what they'd need to invest in a single fixed annuity to generate an additonal $10,000 a year of income for life. Another piece of advice given in the Kiplinger Report is worth repeating:
"Consider buying products from several insurance companies to spread your risk if one of the insurance companies goes under."
This strategy then is one of "laddering" to hedge your bets. I also invite readers to try to ladder a set that would also deliver $10k a year for their needs.
Remember, folks, as long as our politicos are playing the odious tax cut game your future benefits WILL be cut - those cuts will have to pay for your temporary piddling tax cuts. Only someone living in Financial Fantasyland will not see this. It is your job to be proactive and seek to protect yourself now, since you obviously won't be able to depend on our tax cut hostage government to do so!
Friday, June 22, 2012
Advice to Karen Klein: Take the Money and RETIRE!
By now, everyone who hasn't been living under a rock is aware of the vile bullying of 68-year old school bus monitor Karen Klein, at the hands of some loathsome juvenile delinquents. (No, I don't mince words, or use euphemisms - and neither should anyone after watching this video (scroll toward the middle of the news page):
http://www.wptv.com/dpp/news/local_news/water_cooler/karen-klein-bus-monitor-abuse-video-youtube-video-of-woman-bullied-by-children-goes-viral
No sooner had the vid made it onto Youtube than it became viral and a worldwide sensation, with outrage pouring in from places as far away as Australia. People in civilized countries (such as those that still evince some respect for their elders and revile bullying in general) were aghast that the little maggots could even go so far as to taunt Karen over her son who had committed suicide. As they say, that behavior is the pits.
But, as can be observed in the video, Karen remained seated and took the abuse stoically which was a large part of what drew admiration. As news reports point out, Karen isn't being paid a hell of a lot to take this crap, about $15,000 a year. But so many well wishers felt bad for her that they set up a fund, ostensibly to "send her on vacation". As reported on this morning's CBS Early Show that fund now stands at just under $450,000.
Vacation...Vexation.....It's time for Karen to RETIRE!
Why hang around a peaknuckle job where you're not appreciated, and with the potential for such incidents to recur? (Oh sure, the kids have apparently "apologized", but anyone with working neurons knows that's more driven by pressure from irate parents than from heartfelt acknowledgement of what they subjected this woman to.) Why go back to that crap?
The fact is, the money so far accumulated for Karen is more than enough to allow her to retire comfortably, without ever having to face any potential harassment again, say when a new crop of congenital misfits enters center stage - and whose parents may not be as rigorous about discipline. (Especially after this incident recedes into oblivion.)
Let's look at the financials:
Even after Uncle Sam and her state (New York) take out their respective taxes, Karen will be left with around $270,000. With this one lump sum, she can purchase an immediate fixed annuity that will provide her with $1,542 a month lifetime income. As long as she lives (and actuarial tables show the average American woman still kicking at 68 can expect to live to at least 83) she will have that money coming in. Add in Social Security (say $1000 a month estimated) and that yearly income total climbs to $30,492 or more than double what she's earning in her job.
That amount will more than allow for occasional vacations and other luxuries she can't afford currently, by virtue of nearly doubling her disposable income.
If Karen wants to put aside a liquid fund for emergencies, and not tie all her money up in an annuity (or ladders of such) she can still come out ahead. Let's say then she opts to put $120,000 away for reserve money, say in a money market fund (Capital One currently is offering about 0.50%) she can have that money at the ready while also earning interest of about $650 a year. If she buys an immediate fixed annuity with the balance ($150k, and notice how I am not factoring in stocks or bond funds, or mutual funds at all....with good reason...because they are about to take a nose dive when the Eurozone problems come- a -calling) she will generate $856 a month based on a single life income and that adds to $10,273 a year. Add in her estimated Social Security and the annual income total comes to $22, 273/yr. Again, a lot more than she's earning.
For those who'd like to see or get an estimate of different immediate fixed annuities for differing amounts and ages, go to: http://www.immediateannuities.com/
Here's the deal: I've seen too many Americans raised and nurtured on the Calvinist 'work til you drop dead' ethic work too long and postpone what good life, or at least better life, they could have until too late. Time waits for no one, and as a person ages, health problems tend to multiply. The fantastic Swiss Alpine trip planned at age 50 for a retirement in 15 years or 20, may never come to pass if the person or couple is struck by multiple serious health problems. One cannot assume anything!
Thus, when the opportunity presents itself, the best option is always to take the path that most immediately enhances one's life options and quality and using that remaining time on Earth for self-edification, improvement. Read, learn, volunteer, TRAVEL where and when you can! Karen opined in a news segment last evening that she desired to take "an RV trip across America". Well then do it! And do it at your pace without having to worry about the need to report back to work as a monitor for ingrates and n'er do wells. (Of course, many will say most of the kids weren't like that, and plausibly in the future most won't be either. Maybe, but why take the chance on a repeat that may be even worse, with another generation of kids that may be more degenerate than those that abused here. Hell, life's too short to make such bets!)
Anyway, that's my advice to Karen, for what it's worth. I hope (for one) that she takes it!
http://www.wptv.com/dpp/news/local_news/water_cooler/karen-klein-bus-monitor-abuse-video-youtube-video-of-woman-bullied-by-children-goes-viral
No sooner had the vid made it onto Youtube than it became viral and a worldwide sensation, with outrage pouring in from places as far away as Australia. People in civilized countries (such as those that still evince some respect for their elders and revile bullying in general) were aghast that the little maggots could even go so far as to taunt Karen over her son who had committed suicide. As they say, that behavior is the pits.
But, as can be observed in the video, Karen remained seated and took the abuse stoically which was a large part of what drew admiration. As news reports point out, Karen isn't being paid a hell of a lot to take this crap, about $15,000 a year. But so many well wishers felt bad for her that they set up a fund, ostensibly to "send her on vacation". As reported on this morning's CBS Early Show that fund now stands at just under $450,000.
Vacation...Vexation.....It's time for Karen to RETIRE!
Why hang around a peaknuckle job where you're not appreciated, and with the potential for such incidents to recur? (Oh sure, the kids have apparently "apologized", but anyone with working neurons knows that's more driven by pressure from irate parents than from heartfelt acknowledgement of what they subjected this woman to.) Why go back to that crap?
The fact is, the money so far accumulated for Karen is more than enough to allow her to retire comfortably, without ever having to face any potential harassment again, say when a new crop of congenital misfits enters center stage - and whose parents may not be as rigorous about discipline. (Especially after this incident recedes into oblivion.)
Let's look at the financials:
Even after Uncle Sam and her state (New York) take out their respective taxes, Karen will be left with around $270,000. With this one lump sum, she can purchase an immediate fixed annuity that will provide her with $1,542 a month lifetime income. As long as she lives (and actuarial tables show the average American woman still kicking at 68 can expect to live to at least 83) she will have that money coming in. Add in Social Security (say $1000 a month estimated) and that yearly income total climbs to $30,492 or more than double what she's earning in her job.
That amount will more than allow for occasional vacations and other luxuries she can't afford currently, by virtue of nearly doubling her disposable income.
If Karen wants to put aside a liquid fund for emergencies, and not tie all her money up in an annuity (or ladders of such) she can still come out ahead. Let's say then she opts to put $120,000 away for reserve money, say in a money market fund (Capital One currently is offering about 0.50%) she can have that money at the ready while also earning interest of about $650 a year. If she buys an immediate fixed annuity with the balance ($150k, and notice how I am not factoring in stocks or bond funds, or mutual funds at all....with good reason...because they are about to take a nose dive when the Eurozone problems come- a -calling) she will generate $856 a month based on a single life income and that adds to $10,273 a year. Add in her estimated Social Security and the annual income total comes to $22, 273/yr. Again, a lot more than she's earning.
For those who'd like to see or get an estimate of different immediate fixed annuities for differing amounts and ages, go to: http://www.immediateannuities.com/
Here's the deal: I've seen too many Americans raised and nurtured on the Calvinist 'work til you drop dead' ethic work too long and postpone what good life, or at least better life, they could have until too late. Time waits for no one, and as a person ages, health problems tend to multiply. The fantastic Swiss Alpine trip planned at age 50 for a retirement in 15 years or 20, may never come to pass if the person or couple is struck by multiple serious health problems. One cannot assume anything!
Thus, when the opportunity presents itself, the best option is always to take the path that most immediately enhances one's life options and quality and using that remaining time on Earth for self-edification, improvement. Read, learn, volunteer, TRAVEL where and when you can! Karen opined in a news segment last evening that she desired to take "an RV trip across America". Well then do it! And do it at your pace without having to worry about the need to report back to work as a monitor for ingrates and n'er do wells. (Of course, many will say most of the kids weren't like that, and plausibly in the future most won't be either. Maybe, but why take the chance on a repeat that may be even worse, with another generation of kids that may be more degenerate than those that abused here. Hell, life's too short to make such bets!)
Anyway, that's my advice to Karen, for what it's worth. I hope (for one) that she takes it!
Subscribe to:
Posts (Atom)