Freeman's Blog


October 30th, 2012 by

The health insurance landscape is changing, and larger deductibles and copays could mean that families will be spending more of their household incomes on medical care. One survey found that 39% of employers planned to increase in-network deductibles for 2012 insurance plans to help curtail premium costs.

It's OK to hagle over heath care

Becoming a more informed consumer may help you reduce your medical bills. Here are some tips that could help you save money while pursuing better health.

  • Communicate to service providers that costs matter to you. Doctors may be more inclined to take your financial situation into account when making recommendations.
  • Ask about generic prescription options for recommended drug regimens.
  • Before scheduling potentially expensive diagnostic tests or health screenings, confirm that the service provider is in your insurance network and/or ask for a referral to one who is.
  • For elective procedures, take your time choosing a doctor and a facility because charges can vary widely. Ask for detailed estimates and try to negotiate a better price.
  • If you receive a bill that is higher than expected, don’t assume it is set in stone. Check hospital bills closely for errors, dispute charges that you feel your insurance should cover, and if all else fails offer to settle your account at a discount.

Sources: USA Today, October 7, 2011; Consumer Reports, October 2011

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October 25th, 2012 by

The odds of replacing current income in retirement

Do Retirement Specialists Know Better?

Americans who are most likely to be prepared for retirement contribute at least 10% of their incomes to a 401(k) or similar defined-contribution plan. If that goal seems out of reach, consider that participants who contribute 4% to 10% of their earnings still have an 84% chance of replacing their current incomes. Distributions from employer-sponsored plans are subject to ordinary income tax. Withdrawals taken prior to age 59½ may be subject to a 10% federal income tax penalty, with certain exceptions such as the plan participant’s death, disability, or separation from service at age 55 or older.

Discussing your retirement goals with a professional could motivate you to save more.

Your retirement adviser can review your financial vehicles whenever you have concerns. Although there is no assurance that working with someone will improve your nest egg results, a professional who focuses on your overall,  long-term retirement strategies can help you consider options that could have a substantial effect on your retirement dollars.
Source:, July 1, 2011

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October 24th, 2012 by

In a 2012 survey, 50% of current retirees said they retired earlier than they had planned.1

Retirement PlanningMany retirees reported reasons that were beyond their control, such as health problems or disability, company downsizing or closure, changes in the skills required for their jobs, or having to care for a spouse or family member. Yet some said they retired early by choice because they could afford to or because they wanted to do something different.2

If you’re nearing the end of your working years, you probably have a retirement timetable in mind. It may be as specific as a particular date or as general as a range of years. Regardless of your retirement planning, circumstances could change (as the experience of current retirees demonstrates) and retirement might come sooner than you think.

Calculate Your Income Stream

trend in age retirementIf you had to retire early, would you be able to maintain your standard of living? It might be helpful to calculate your projected income based on your preferred retirement timetable and an earlier date. Of course, the sooner you retire, the less time there will be for your financial instruments to pursue potential growth, so accelerating your retirement dollars now could make a big difference in how much you might have in your nest egg. If you retire on schedule (or later), having a potentially larger nest egg could give you more flexibility in your retirement lifestyle. Also keep in mind that Social Security benefits typically will be reduced if you retire before your “full retirement age,” which ranges from 65 to 67, depending on year of birth.

life_guide_retirementSurprises can be fun in many situations, but not when it comes to retirement. Preparing now could help ease you into a more comfortable retirement lifestyle.Download my free “Thinking Of Retirement?” Life Guide to help you with your retirement planning.

footnote 1 and 2 = Employee Benefit Research Institute, 2012

October 23rd, 2012 by

There are a number of reasons why people buy annuities. This insurance-based financial vehicle can provide many benefits that retirees might want.

Retirement planningDeferral of taxes is a big benefit, and so is the ability to put large sums of money into an annuity — more than is allowed annually in a 401(k) plan or an IRA — all at once or over a period of time. Annuities offer flexible payout options that can help retirees meet their cash-flow needs. They also offer a death benefit; generally if the contract owner or annuitant dies before the annuitization stage, the beneficiary will receive a death benefit at least equal to the net premiums paid. Annuities can help an estate avoid probate; beneficiaries receive the annuity proceeds without time delays and probate expenses. One of the most appealing benefits of an annuity is the option for a guaranteed lifetime income stream.

When you purchase an annuity contract, your annuity accumulates tax deferred until you start taking withdrawals in retirement. Distributions of earnings are taxed as ordinary income and may be subject to an additional 10% federal income tax penalty if taken prior to reaching age 59½.

Fixed annuities pay a fixed rate of growth that can start right away (with an immediate fixed annuity) or can be postponed to a future date (with a deferred fixed annuity). Although life_guide_retirementthe rate on a fixed annuity may be adjusted, it will never fall below a guaranteed minimum rate specified in the annuity contract. This guaranteed rate acts as a “floor” to protect owners from periods of low interest rates. Any guarantees are contingent on the claims-paying ability of the issuing insurance company.

Download my free “Thinking Of Retirement?” Life Guide to help you with your retirement planning.