Good Day Alabama: May 12, 2015
Here's what you saw:
MONEY TUESDAY - Stewart Welch joined us with four tips for saving for retirement! Recent research suggests that a full one-third of working Americans have no retirement savings. Another third have saved under $50,000. Thirty percent had saved more but fall far short of being on track to fully funding retirement based on their current lifestyle. Only about 4% were on or above track to accumulate enough wealth to allow them to retire with enough money to replace their work income. Stewart says with healthcare today and what he suspects will be significant improvements in healthcare in the future, large numbers of us will live well into our nineties and perhaps past age one hundred. He finds people generally fall into one of two broad categories:
Group A: "I have plenty of 'today' problems…I'll worry about retirement tomorrow." Unfortunately, today's problems tend to morph into a new set of problems tomorrow so 'getting to retirement planning' never seems to come. This defines the 96% who never save enough money.
Group B: "I have plenty of 'today' problems…but I'll add retirement planning to the list and start working on it now!" For the few that have this attitude here are some tips to help speed you along the way:
1. Know your number. It's hard to solve a problem without understanding the magnitude of the problem. How much exactly do you need to accumulate for retirement? Start with your net annual income - the total of net paychecks you deposit in the bank over one year. That's what you're spending now so let's assume you'll need that in retirement also. Subtract from this number any sources of income you reasonably expect at retirement such as Social Security or a company pension. Divide this number by 0.04 to determine the amount of capital you'll need to accumulate to replace your earned income during retirement. You should use this as a quick estimate only. Commit to having a detailed analysis completed with a Certified Financial Planner™ practitioner.
2. Track your spending for 30 days. People always tell Stewart they don't have money left over for savings but he has never met a person or couple who isn't wasting a lot of money. Buy an inexpensive small notebook and write down every penny you spend for thirty days then evaluate your spending. Could you divert 10% or 20% to retirement savings without dramatically affecting your lifestyle? We often find substantial saving in reducing property & casualty, life and other insurance products costs.
3. Save smarter. If your company has a matching 401k plan, be sure to invest enough to capture the match. If not invest in a tax deductible IRA. If you're in a low income tax bracket, invest in a Roth IRA. Two easy ways to increase your savings is to commit one-half of all raises or bonuses to your retirement savings program. You can also raise cash and de-clutter by selling your junk - rarely used clothes, garage and household items.
4. Invest smarter. Rates of return of fixed income investments - money market accounts, CDs and bonds - will not get you where you have to go. Be willing to be a long-term investor in the stock market. Yes, in the short term it will be very volatile but long term returns have exceeded 7% or more annually. You'll need a majority of your money invested in the stock market.
You may have a better idea for retirement saving. If so, do that! If not, start here but please don't wait until tomorrow! For more ideas, visit welchgroup.com.
Here's something that could help with weight loss! A shopping list! When researchers surveyed almost 1400 low income people about their shopping habits and their weight, they found that those who shopped with a shopping list weighed about 5 pounds less than those who reported that they did not shop with a list. Take this finding with some caution – this was an observational study – one of those "circumstantial evidence" kinds of studies. So we can't say that using a shopping list will cause you to lose weight – but this is definitely one that couldn't hurt trying. Most of the people in this study were overweight but they tended to weigh less if they used a list.
For better blood sugar control, just add exercise! Researchers randomly assigned 52 overweight men and women to lose weight either by dieting alone, exercising alone , or doing both – exercising and dieting. All three groups lost about the same amount of weight - 6-8% of their body weight. But the group who dieted and exercised has twice as much improvement in their body's sensitivity to insulin. Insulin helps you control your blood sugar. People with type 2 diabetes become less responsive to insulin which makes their blood sugar go up. So even though you may not lose more weight by exercising, you may be lowering your chances of getting diabetes even more! so just diet OR exercise. For the best blood sugar control, do both!
JEH JEH LIVE - Jeh Jeh joined us live from the Kappa Fraternity Facility in Titusville where he finds out about the Kappa Kids at Hemphill School & Proposed Kappa Knight Programs. He talked with Melvin Love about the Hemphill Program and Marlon King, Valton Johnson & CJ Mosley about their visit with students at Hemphill. Former school administrator Leon Harris and Arrington Middle School Principal Anthony Moss discussed launching the Kappa Knights Program Fall 2015 and how this program will bridge the current void between elementary school, middle school and high school and how this will allow continuity of students having access to Kappa mentors throughout school, post secondary and professional careers with the expectation that they will aspire to pledge as Kappa's and help to perpetuate the work of Guide Right's premise. Birmingham City Schools Coach Floyd Smith talked about how much mentoring works in the schools.