My Personal Finance Blog

On 30th July 2010, the Government announced that the default retirement age, which is 65, is to be phased out from 6th April 2011 and abolished completely from 1st October 2011, when the statutory retirement procedures will be removed.

The current situation is if an employer wishes to retire an employee who has attained the default retirement age of 65, an employer must give a minimum of 6 months notice, or a maximum of 12 months notice of retirement to those employees. The notice must give the employees the right to request to work beyond their retirement age, in which case there should be a meeting to discuss this request, together with the right of appeal in respect of the decision. If, following the appeal the ultimate decision is that an employee is to retire upon his or her attaining the age of 65 years, there is no need for the employer to give reasons for the decision. The reason for dismissal is retirement.

From 6th April 2011 it will no longer be possible for employers to retire employees with this procedure. Indeed there will be transitional arrangements for retirements that have been notified prior to 6th April 2011 and where the date of retirement occurs before 1st October 2011.

From 1st October 2011, subject to the transitional arrangements, if an employer wishes to dismiss or retire an older employee, this would involve following a fair procedure and relying on one of the established reasons for a potentially fair dismissal which are set out in the Employment Rights Act 1996, which are, conduct, capability, illegality, redundancy or some other substantial reason.

The Government has published a consultation document, explaining the proposals to phase out the default retirement age. Responses to the consultation are required by 21st October 2010.

Once you complete the fixed years in your service, it is the time to retire. This is a crucial period of your life as you are mentally prepared to accept the fact that you have worked enough, and now you have to rest. You want to spend the remaining days of your life playing with your grandchildren and enjoying a relaxed schedule.

It is true that age for retirement entirely depends on an individual, but according to the U.S. Census Bureau, the retirement age is 62 years. Another most important thing is that age of retirement differs from one country to another. Regardless of the countries, it varies between fifty to seventy years of age range. There are also countries where different retirement age is set for male and female.

Sometimes, retirement age also depends on the particular occupations and professions. For example, those who are in military professions, or working as pilot, they require high level of physical and mental proficiency. So, for the professionals of these fields, retirement age is not same as the other industries.

Many a times, it has also been noticed that the individuals also choose an early or late retirement age depending on their needs and preferences. There are benefits and drawbacks of both early and late retirement. If you opt for early retirement, installment rates will not be huge enough, but you will get it for a longer duration. On the contrary, if you choose late retirement age, you will get larger rate of interest for a shorter time period.

In the US, 96% of employees are under the protection of Social Security which is considered as an integral part of the retirement plan. So, you must know all the pros and cons to be eligible for Social Security benefits and other related issues.

When the individuals reach the retirement age, they apply for availing different Retirement Insurance Benefits, and Old-age Insurance Benefits. The U.S. Social Security Administration is responsible for monitoring all these issues as the senior citizens can reap the best during the period of retirement. The date of birth, retirement age, etc. play important role for benefit payments.

After retirement, the retirees don’t get their monthly salaries, and they need to support themselves through pensions or savings. Normally, the government plays major part to support the senior citizens after retirement. There are quite a few financial institutions which offer various retirement plans as well.

In later life, people become more prone to illness. For this reason, the cost of health care after retirement becomes heavier. To protect the retirees, there are universal health insurance facilities for seniors which they can avail after reaching the age of retirement.

The internet will provide hope for many baby boomers looking for the best way to make money for their retirement. 2011 marks the year that the oldest Baby Boomers reach their 65th birthday. For the last quarter century, this generation has been fueling our economy, pushing stock prices, real estate values, and the prices of all assets in general, higher than ever before.

Unfortunately, not only were we borrowing most of the money we needed to pay for our purchases, but we were leveraging the very assets we were purchasing, at an over-inflated price. In other words, we were buying things with money we didn’t have, paying a higher price than the things were worth, thereby skewing the demand side of the traditional “supply and demand” model. The supply curve responded to a demand curve that was not backed by real money.

Now, at a time when we want to “cash in our chips,” we are discovering that our chips aren’t worth as much as we, perhaps naively, thought that they would be worth. That is to say, nobody will now give us as much for our chips as we originally paid for them. Since we based our retirement lifestyle on the inflated value of our chips, and now can’t find any buyers for those chips at the inflated price, we have to sell our chips for less. As a generation of folks not willing to settle for less, we will need to figure out a way to create more chips.

Fortunately, one of the greatest technological contributions of Baby Boom generation – the internet – will prove to be its salvation. The internet will become the best hope this generation has to make money for its retirement. This technology has created the fastest growing business platform in history, producing tremendous opportunities for entrepreneurs who want to succeed in business for themselves by taking advantage of the proven business models available on the internet.

The prerequisites are minimal, and there are plenty of honest, legitimate, and successful internet entrepreneurs willing to teach anyone who wants to learn how to acquire the skills and techniques necessary to create income online.

The Internal Revenue Service (IRS) today announced cost of living adjustments affecting dollar limitations for pension plans and other retirement-related items for tax year 2011. In general, these limits will either remain unchanged, or the inflation adjustments for 2011 will be small.

The elective deferral contribution limit for employees who participate in section 401(k), 403(b), or 457(b) plans, and the federal government’s Thrift Savings Plan remains unchanged at $16,500. The catch-up contribution limit under those plans for those aged 50 and over remains unchanged at $5,500.

The deduction for taxpayers making contributions to a traditional IRA is phased out for singles and heads of household who are active participants in an employer-sponsored retirement plan and have modified adjusted gross incomes (AGI) between $56,000 and $66,000. This amount is unchanged from 2010.

For married couples filing jointly, in which the spouse who makes the IRA contribution is an active participant in an employer-sponsored retirement plan, the income phase-out range is $90,000 to $110,000, up from $89,000 to $109,000. For an IRA contributor who is not an active participant in an employer-sponsored retirement plan and is married to someone who is an active participant, the deduction is phased out if the couple’s income is between $169,000 and $179,000, up from $167,000 and $177,000.

The AGI phase-out range for taxpayers making contributions to a Roth IRA is $169,000 to 179,000 for married couples filing jointly, up from $167,000 to $177,000 in 2010. For singles and heads of household, the income phase-out range is $107,000 to $122,000, up from $105,000 to $120,000. For a married individual filing a separate return who is an active participant in an employer-sponsored retirement plan, the phase-out range remains $0 to $10,000.

The AGI limit for the saver’s credit (also known as the retirement savings contributions credit) for low-and moderate-income workers is $56,500 for married couples filing jointly, up from $55,500 in 2010; $42,375 for heads of household, up from $41,625; and $28,250 for married individuals filing separately and for singles, up from $27,750.

For the eight million Americans who own long-term care insurance, eligible long-term care insurance premiums included in the term ‘medical care’ range from $340 to $4,240 per-individual. The applicable limit is based on attained age before the close of the tax year, according to the Accountant’s Guide to Long-Term Care Insurance, published by the American Association for Long-Term Care Insurance, the national trade group.

The limits are as follows: For age 40 or less, $340; for more than 40 but not more than 50, $640. For more than 50 but not more than 60, $1,270. For more than 60 but not more than 70, $3,390 and for more than age 70, $4,240.

The basic criteria for Social Security Retirement Age are the individual’s birth date. Studies have revealed a fact that these days are more health conscious and thus life spans have increased. And as a counter reaction Social Security Retirement Age has been modified accordingly. People can enjoy the benefits of the service in proportion with their age. There is a section of individuals who prefer not to work after a certain age. They can take advantage of the services by planning for their future well in time. Social Security retirement age is one of the major factors kept in mind while formulating the plans for retirement as well as the age appropriate for retirement.

Earlier Social Security Retirement Age was fixed at sixty-five years for long, along with the option of getting premature retirement at the age of sixty-two in case an individual demanded for it. Though some benefits were accordingly reduced for them. People working in congress are given the charge of formulating various necessary aspects regarding the issue. Various informational surveys and study of social conditions have been taken into account by them before finally deciding the Social Security Retirement Age. These councils have to visualize the basic needs of people and accordingly bring out the Social Security retirement age along with the different amount of benefits that the individuals will be getting at various stages.

Social Security Retirement Age Reflects the Needs of the Community

Depending upon there personal situations people have varied preferences as far as Social Security retirement age is concerned. Some prefer to keep working for as long as possible and get the complete benefits while others may opt for getting an early break and settling off with a lesser amount of money in the process. There is another group who wants to continue working even after their specified retirement age. So various people have different visualizations and situations according to which they have their choice of how and when they want to take the final break off from work.

Social Security Retirement Ages [http://www.1retirementplan.com/Retirement_Living/] are well specified according to the time of birth of a person. Complete benefits are offered to people born before 1973. They can opt to retire at the age of sixty-five and can enjoy full benefits. Individuals born between 1943 and 1954 have the option of going on with their work till the age of sixty-six, and reap full benefits. People born after 1960 can retire at sixty-seven taking the advantage of all benefits. Along with all the above criteria’s, all individuals have a fair option to retire at any stage, but their benefits get reduced accordingly. People also prefer to put in some extra money all the way during their tenure and get equally better amount at the later stages.