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  • Smaller Social Security Checks for 1947-Born Boomers
    Smaller Social Security Checks for 1947-Born Boomers
    Sponsored by <img width=1 height=1 alt="" src="us.bc.yahoo.com/b?P=q9Ym69G_R1emFPNISteC...;>
    by Emily Brandon
    Friday, October 16, 2009provided byUSNews.com

    Social Security checks increased by 5.8 percent this year, the largest Social Security increase in over 25 years.

    Next year is a different story. There will be no cost-of-living increase for Social Security recipients. Beneficiaries are not expected to receive another adjustment until 2012, under current law. Social Security increases are tied to the Consumer Price Index for Urban Workers, which decreased in 2009 due to plummeting prices.

    More from USNews.com:

    Social Security Makes the Call: No 2010 COLA

    Social Security's Wheel of Fortune

    America's Best Affordable Places to Retire

    The seniors who will be most impacted by the absence of a Social Security boost are not current beneficiaries, who will continue to get checks for the same amount, but new retirees born in 1947 who first signed up for Social Security this year, according to a new analysis by Andrew Biggs, a resident scholar at the American Enterprise Institute and a former deputy commissioner of the Social Security Administration. This group of people never benefited from the supersized Social Security increase last year and could see their purchasing power eroded by inflation before cost-of-living increases resume in 2012. "Current retirees won't be hurt, but new retirees will have a permanent benefit reduction of around 5 percent," says Biggs. "Folks in the 1947 cohort will tend to receive benefits around 5 percent lower than they would have had the 2008 up and down spike in inflation not occurred."

    The inflation hiccup in 2008 will cause newly retired couples receiving a monthly Social Security check of $2,235 to receive $1,340 less in each year of retirement than they would have if the Consumer Price Index had a more steady climb, according to calculations by Biggs. If the pair survives until age 83, the couple will get $25,000 less in lifetime benefits. Americans turning 62 in 2010 will also receive lower lifetime benefits, but their reduction will be around half that of current 62-year-olds.

    This financial loss can't be avoided by delaying retirement until after cost-of-living adjustments are currently projected to resume in 2012, Biggs cautions. Inflation adjustments, or the absence of them, are factored into the calculation of your Social Security payment if they occur in the year you turn 62 or later, even if you haven't signed up for benefits yet. "Basically, the inflation adjusted primary insurance amount as of ages 63 and 64 will be the same as it was at 62, since the cost of living adjustments over the next two years will be zero," says Biggs.

    Copyrighted, U.S.News & World Report, L.P. All rights reserved.
    Oct 16 09:55 am | Link | 2 Comments
  • Quote of the Day - - Elizabeth Warren
    "The middle class became a resource to be pulled from - "the turkey at the thanksgiving dinner" - the middle class has gotten shakier and shakier, it has become hollowed out. The middle class makes us who we are. The middle class gives us political stability. It is safe to walk our streets because we have a middle class. And every time we hollow [the middle class] out we take the risk that something of what we know as America begins to die. That's what scares me." - Elizabeth Warren
    Oct 16 07:17 am | Link | Comment!
  • .the value of your house. From the Washington Post:
    .the value of your house. From the Washington Post:

     

    "We have cases where houses are being appraised at less than the cost to build them," Howard said. "People are just being really, really conservative."

    Some housing industry insiders also say that the appraisal process has become more complicated since the implementation of a new set of rules, known as the Home Valuation Code of Conduct, in May. The rules, put in place by Fannie Mae and Freddie Mac, aim to shield appraisers from pressure to submit a desired estimate of a home's value to hasten its sale.


    Oct 09 10:12 pm | Link | Comment!
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