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3 retirement risks that older Americans often forget to budget for. How to protect your nest egg

3 retirement risks that older Americans often forget to budget for. How to protect your nest egg

Yahoo20-04-2025

Planning for retirement is something that's best to do throughout your career, not just when you're approaching that milestone and have a year or two left to work.
Only half of Americans have tried to calculate how much money they'll need in retirement, according to a 2024 survey by the Employee Benefits Research Institute (EBRI).
I'm 49 years old and have nothing saved for retirement — what should I do? Don't panic. Here are 5 of the easiest ways you can catch up (and fast)
Nervous about the stock market in 2025? Find out how you can access this $1B private real estate fund (with as little as $10)
Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how
However, among those workers who did the calculation, 52% were inspired to save more. Even if you feel confident in your ability to cover your retirement expenses, it's important to be mindful of hidden costs that could impact your retirement finances. Here are three to keep on your radar.
Fidelity Investments expects the typical 65-year-old to spend $165,000 on healthcare during retirement. That may sound surprising, but even with Medicare coverage, several expenses could arise.
For one thing, Medicare isn't entirely free. Most enrollees don't pay a premium for Part A, which covers hospital care. However, Part B, which covers outpatient care, charges a monthly premium, as do some Part D drug and Medicare Advantage plans. Plus, higher earners risk surcharges on their Medicare premiums.
Premiums aside, there are a number of expenses that original Medicare (Parts A and B plus a Part D drug plan) does not cover, which retirees commonly need. These include dental care, eye exams, prescription glasses and hearing aids.
You'll also face copays and coinsurance under Medicare that you must pay out of pocket. If enrolled in original Medicare, you can buy supplemental insurance known as Medigap to help offset those costs. But then you're looking at premiums for Medigap, too.
Read more: The US stock market's 'fear gauge' has exploded — but this 1 'shockproof' asset is up 14% and helping American retirees stay calm. Here's how to own it ASAP
It's a big misconception that Medicare will pay for you to live in a nursing home or cover the cost of a home health aide. Medicare's scope of coverage is typically limited to medical issues only. So while Medicare might pay for rehab or physical therapy because you broke a hip, it won't pay for a home health aide because you're getting older and need help dressing yourself and using your kitchen.
Meanwhile, the cost of long-term care can be astronomical. According to Genworth, here are the annual median costs for certain long-term care services in the U.S. for 2024:
One option for defraying these costs is to buy long-term care insurance. But that might bust your budget, too. The American Association for Long-Term Care Insurance says an average $165,000 policy with no inflation protection purchased at age 55 by a single male costs $950 a year. For a 55-year-old female, that policy costs an average of $1,500. And for a 55-year-old opposite-gendered couple, the average price is $2,080 combined.
Of course, the actual cost of long-term care will depend on factors such as where you're located, your age at the time of your application and the state of your health. But all told, you might spend a lot of money to put that coverage in place.
In recent years, retirees and working Americans alike have experienced their share of rampant inflation. But even when inflation isn't as aggressive, it's still a hidden cost that can upend your retirement budget.
Social Security benefits are, thankfully, designed to keep up with inflation. They're eligible for an annual cost-of-living adjustment tied to the Consumer Price Index for Urban Wage Earners and Clerical Workers, a subset of the more widely known Consumer Price Index.
But ensuring that your savings can keep up with inflation is also critical. One way to do this is to avoid eliminating equities from your portfolio in retirement. You need some growth in your portfolio to make up for rising living costs. You can work with a financial advisor to develop an appropriate asset mix based on your income needs and risk appetite.
A financial advisor can also help set you up with assets in your portfolio that generate income. These could include dividend stocks, bonds and real estate investment trusts (REITs).
It could also be a good idea to delay your Social Security claim past your full retirement age, which is 67 for anyone born in 1960 or later. For each year you do, until age 70, your benefits rise 8%. And that boost is guaranteed for life.
Having a larger monthly benefit gives you more leeway to tackle not only inflation, but also surprise medical and health-related expenses. So it's a move worth considering if you don't need to sign up for Social Security sooner.
Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan 'works every single time' to kill debt, get rich in America — and that 'anyone' can do it
Rich, young Americans are ditching the stormy stock market — here are the alternative assets they're banking on instead
Here are 5 'must have' items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you?
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

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Elon Musk Has Benefited From DOGE Cuts but Have the Rest of Americans? Experts Weigh In
Elon Musk Has Benefited From DOGE Cuts but Have the Rest of Americans? Experts Weigh In

Yahoo

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Elon Musk Has Benefited From DOGE Cuts but Have the Rest of Americans? Experts Weigh In

Elon Musk's Department of Government Efficiency (DOGE) has claimed massive savings while facing criticism for potentially benefiting the billionaire personally. Congressional reports estimate Musk's companies avoided $2.37 billion in potential liability through DOGE's regulatory changes this year. For You: Read Next: Meanwhile, everyday Americans face increased delays and diminished access to essential services, according to finance expert Andrew Lokenauth, founder of A Senate subcommittee investigation revealed how DOGE cuts have disproportionately benefited Musk and his business empire. According to the minority staff report, Musk's companies faced 25 federal investigations before Trump took office. The report estimated Tesla alone faced $1.19 billion in potential liability for allegedly misleading autopilot statements. Check Out: The Congressional analysis further revealed that Musk put pressure on the head of the Federal Aviation Administration (FAA) to resign before Trump's inauguration. This could be because in September 2024 the FAA suggested several fines totaling $633,009 against SpaceX for license infractions. The FAA also tried to dismiss regulators overseeing Musk's economic interests. However, Musk can't be held accountable for this action because his status as senior advisor shields him from scrutiny that cabinet members receive. DOGE's website claims $175 billion in total savings since Trump took office, representing over $1,000 per taxpayer. However, analysis by multiple news outlets reveals significant accounting errors and questionable methodology in these calculations. According to The New York Times, earlier DOGE claims included an $8 billion typo for an $8 million contract. The Atlantic reported that verified budget savings stood at just $2 billion after correcting various accounting mistakes. Per a BBC analysis, less than 40% of DOGE's claimed savings include links to supporting documentation. According to CBS News, DOGE's actions may have actually cost taxpayers $135 billion through productivity losses and rehiring. 'There have been sectors where waste was reduced, mainly in outdated bureaucratic processes. Streamlining digital operations or cutting legacy contracts helped modernize tech and defense procurement. A few urban centers even saw faster permit approvals,' said Daniel Ray, national insurance expert and CEO of 'Rural communities and working-class families often get hit hardest. When funding is cut without a backup plan, essential services like mail or healthcare access vanish overnight,' Ray added. Reports from USA Today and the Center for American Progress also confirmed that Americans in some regions are experiencing longer wait times for Social Security and other federal services after staff reductions. Public trust in federal agencies has continued to decline as DOGE's cost-cutting measures reshape government operations. According to a KFF Health Tracking Poll, 61% of Americans opposed major cuts to staff and spending at federal health agencies. Moreover, 54% said the Trump administration and DOGE have gone too far with recent reductions. The same survey found that most Democrats and independents see the cuts as reckless, while a majority of Republicans support the changes as necessary for efficiency. 'Some see the cuts as needed tough love, while others see neglect. The mixed signals make it harder for people to believe the system works for them, especially when services feel slower or out of reach,' Ray explained. An analysis from the Council on Criminal Justice also warned that funding cuts risk eroding public trust in government, especially when services are reduced or discontinued. Lokenauth said indiscriminate reductions can lead to disruptions, backlogs and a decline in service quality, which further undermines confidence in federal institutions 'Policymakers need to understand fiscal responsibility should never mean sacrificing service. The lesson from DOGE is clear: Cutting costs isn't leadership unless paired with clear improvements and a strategy that protects the vulnerable while fixing what's broken,' Ray said. While DOGE's $175 billion in claimed savings includes contract cancellations and fraud crackdowns, experts argue that the human cost risks overshadowing short-term gains. The true long-term impact of DOGE's cuts on American communities and finances remains under debate, with both positive and negative effects still emerging. The subcommittee report said it does not accuse Musk of illegal activity in his DOGE role. However, according to multiple experts, the concentration of regulatory relief benefiting Musk's companies raises ethical questions. Per ongoing analysis, the true long-term impact of DOGE's cuts on American communities remains under scrutiny. Editor's note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on More From GOBankingRates 5 Cities You Need To Consider If You're Retiring in 2025 This article originally appeared on Elon Musk Has Benefited From DOGE Cuts but Have the Rest of Americans? Experts Weigh In Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data

Small American Business Owners Are Sharing How Tariffs Are Affecting Them
Small American Business Owners Are Sharing How Tariffs Are Affecting Them

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Small American Business Owners Are Sharing How Tariffs Are Affecting Them

When tariffs on Chinese goods spiked dramatically — peaking at over 100% in some cases before recent reductions — small business owners across America found themselves facing an impossible math problem. From toy designers to computer repair shops, countless entrepreneurs discovered that products they depend on — and that simply aren't made anywhere else — suddenly became prohibitively expensive. When u/toymakerinchina, a manufacturer of indoor playground equipment, asked how US small businesses were handling these dramatic tariff increases, the responses painted a sobering picture of an economy under strain: "Honestly, they're not able to cope. I know two people in separate small businesses in this situation who were running the numbers at 104% yesterday. They're already in a place with not-high margins. They also have to get their product out to distributors and on to end consumers, and there is a markup at each step. They're trying to increase direct-to-consumer sales to get a bit more efficient, but that's really hard. It's more likely they'll go bankrupt unless things get fixed fast. There aren't any American alternatives for the imported supply, and there won't be in the future. They're doomed to fail." "I have a computer repair shop. Literally everything computer-related is made in China, with few exceptions — Taiwan and Mexico, sometimes. New computers are about to get real expensive. This will either surge my business, in which case we'll just lower our margin on parts and maintain labor cost, or people are going to pay out the nose for new computers." "I've just had to place an order for $80,000 worth of equipment to be produced. Specialized gear only made in China. The budget was around $110,000 total. Now maybe $150,000. It will hurt if this level — or worse — is in place when it's ready to be shipped. It will take about three months to fabricate it all. I don't know if I have any way to mitigate this." "Our selling prices are going way up. Our sales volume will suffer because our poorest customers won't be able to afford our product. It's an item for people with disabilities. It's sad." "My sister designs plush toys and runs her own business. She's a small operation, but it's been her full-time gig for almost 10 years. On average, her orders are around 2,000 to 5,000 toys at a time. Her latest order was flat-out cancelled by the supplier. She's completely screwed. There simply isn't a viable alternative company that isn't based in China." "The previous steel and aluminum tariffs from the pandemic were rough. This is on another level. I don't think most people understand how screwed we are. Currently, my suppliers are trying to raise prices slowly. They're playing chicken with each other. They know they can't raise everything overnight, as they're also competing with other suppliers, and they still need to move product in order to maintain cash flow. I've been hoarding lots of inventory in preparation, but how long will it take to move that product if the economy is slow due to overall inflation? Our costs are just one aspect of being in business. If our customers are squeezed from every direction by tariffs on everything, then they don't have cash to purchase things from us. Then toss in some idiotic DOGE nonsense, where you eliminate millions of people from viable employment." "I'm about to close shop after doing it as my exclusive job for 10 years. It's screwed." "I have a $48,000 order that I placed two days ago just before the latest China tariff increase. Haven't paid the deposit yet, and now reassessing the move. Considering 1) reducing the order size just to not have such a large bill come due in two to three months and start seeking other suppliers in lower-tariffed countries or the US — although I would expect that even if we found a US manufacturer, the price would work out to be the same if not higher; 2) keep the order, but start adding a tariff fee to invoices now; 3) do nothing and hope the jerk in charge changes this move before the goods hit customs. We've already negotiated a lower price with our supplier, so not much else to be done there. We just raised our prices for the first time in three years to finally pass along some of the cost increases we've incurred in that time. It looked like we'd finally improve our margins over where they've been the last few years. And now this." "My family runs a restaurant. If our prices for takeout containers and other small disposables skyrocket, we're going to put some behind a price instead of giving them out for free. Currently, a large takeout foam container is 20 cents. If it hits 40 cents or more, we will tack on a 25-to-50-cent fee depending on just how high it actually goes. Please, everyone, understand that a small mom-and-pop style restaurant only runs 3% to 6% pure profit if that — right now, we are at about 4%." "My partner had a bunch of inventory on hand pre-tariff so he's just selling that and not ordering anything for now. And he raised prices because he can. He's pointing out that price increases are due to tariffs to educate his red-leaning customers on what they voted for." "Our wholesale will probably shut down after the last of our inventory is sold. It was a good run of 10 years but the Chinese tariffs will make continuing business impossible." "I am a small business owner — I create medieval and costume artistic wigs from wig bases made in China. I will pass the tariff on to the customer as I have no other choice. The US will never make what I need, and other countries making wigs don't come even close to the quality of wigs that China makes, not to mention the trust I have with my years-long suppliers and whatnot. I have no solution because I feel like even if we find loopholes, they can be 'plugged' overnight by the Trump administration. I wish I could include the sum of what my customer pays on tariffs in my pricing separately. That's not going to happen, I know. I will have way fewer customers, lose competitiveness on international markets, and will have to start a second business on the side. I see all this as very pessimistic and feel sorry for all of us affected in the US as well as China." "We're exhausted. We're exhausted from running the numbers, coming up with a barely workable solution, only to have the goal posts moved and that solution obliterated again and again and again. My entire industry is imploding. Yesterday, my company laid off the entire team except for the founder, who is still trying to pivot and find yet another workable solution in hopes he can bring us all back before we find other, more permanent placements." "I have a couple retail stores, and I've received calls from multiple wholesale companies saying many items will get 20% to 50% price increases. This was before China's retaliatory tariff increase. I just won't stock any items that have increased by 50%, other than extreme cases. Any items that I continue to stock will get price increases slower than how much they got increased by tariffs. It's so that customers won't notice the sudden sharp increase in price and leave my business with a sour taste. I will eventually increase it to match the same profit margin in the end, but I will do it slowly, even if it eats away my profit in the short term, to stay competitive. If this tariff war continues, I would assume many retail stores in my industry, maybe even I, won't be able to stay afloat and will go out of business. My hope is that I can outlast the competition while this tariff craze is going on. I just hope I don't have to let go of my employees." "The tariffs pose a huge threat to my business. I have an art business in the US, and I print my artwork on various art and stationery products. All of my stationery is manufactured in either Canada or China. I also print on various specialty papers that are only manufactured outside of the US. I have done some preparation by buying a year's worth of supplies to continue printing some of my own products, but I will have to discontinue many of my items for the foreseeable future. I am a small business and can't afford to buy products at such high markups. If these tariffs last long, I will be forced to close my business. I am already preparing by looking for a part-time job to supplement the loss of income this will be for me. Plus, my customer base is not wealthy people. Even if I had the savings to afford 104% tariffs, my customers would not." "Many of my materials are imported because US manufacturers charge almost 90% more for a similar sheet of material. So now my competitors and I will have to pay more for the product. Then we will mark it up the same percentage. $50 with a 100% markup meant I sold it for $100, and the company earned $50. Now it's $75 per sheet, and I mark it up to $150, and the company makes $75. We're more profitable. Sure, we may lose a few sales here or there because people can no longer afford to buy a sign for their business or housing development, but during COVID when scarcity drove prices up, we never ended up in a worse position, so I doubt we will here since people need our products, just as I'm sure people need your products." Are you a small business owner dealing with the impact of tariffs, or do you have thoughts on how these policies are affecting the economy? Whether you've witnessed these challenges firsthand, have ideas for solutions, or simply want to share your perspective on what this means for American businesses, drop your thoughts in the comments — or anonymous form — below. Note: Responses have been edited for length/clarity.

Rents remain far above pre-COVID levels. Use this tool to check prices in your area
Rents remain far above pre-COVID levels. Use this tool to check prices in your area

Yahoo

time44 minutes ago

  • Yahoo

Rents remain far above pre-COVID levels. Use this tool to check prices in your area

After seven years of work and more than $18 million invested, Harbor Village, a new affordable housing development in Carlisle, Pennsylvania, officially opened its doors in January. The 40-unit rental development came together thanks to Safe Harbour, a housing nonprofit based in Carlisle. By the time Safe Harbour started screening prospective tenants, there were over 400 applications, said Scott Shewell, the group's long-time president and CEO. 'And I still get calls every day,' he told USA TODAY. The median apartment rent in Carlisle was $1,259 in May. It was one of the fastest-growing areas for rent prices that month, up 6% from a year ago, according to a USA TODAY analysis of Apartment List data. Shewell wasn't surprised. The area, he said, has seen blockbuster growth over the past several years and even well-meaning local governments committed to affordable housing haven't been able to keep up with the demand. Population in Carlisle borough has gone up nearly 12% since 2020, according to the U.S. Census Bureau. In May, Manhattan, Kansas, led other metros as the fastest-growing market in rental prices. The metro saw a 14% increase in rent prices from the same month last year. It was followed by Abilene, Texas; Grand Forks, North Dakota-Minnesota and Shreveport-Bossier City, Louisiana. Recent data shows that the rental prices in most metro areas have leveled off, but for millions of renters, the typical rent still remains dramatically higher than it was before the COVID-19 pandemic began. The USA TODAY analysis of Apartment List data for 202 metro areas found that average monthly rent between January and May was significantly higher in 94% of the metros, compared with the same period in 2019. Excluding the handful that stayed about the same as pre-pandemic levels, the data showed that prices were up by an average of 31%. The pandemic supercharged the rental market, breaking old patterns of steady growth as the population shuffled, cities closed, and people started working from home. After a short drop in rental prices, prices rebounded aggressively, hitting record highs before flattening in the latter half of 2022. The impact has been felt across the board, from Manhattan in New York City to Manhattan in Kansas. The Apartment List data shows that the new level remained steady in May 2025, which, although a relief, does not do away with the rent burden the already high prices have put on families. According to census data, about 25% of renters in America are so rent-burdened that they spent more than half of their income on rent in 2023. That figure was 22% in 2019. A three-percentage point difference means millions more Americans are spending a substantial chunk of their paycheck in rent. When these high prices were accompanied by broader inflation in groceries, gas and energy, the strain was felt by families – charting up as a top issue in the 2024 presidential election, in which Americans elected President Donald Trump who centered his campaign on bringing down prices. Housing market experts say that the rental market might have settled on a new baseline, which means prices might not go back down to what they were in 2019. Read more: Work from home is reshaping the housing market 5 years after COVID Rob Warnock, a senior research associate at Apartment List, said a reversal to pre-pandemic prices is unlikely, as we're now at a level for how much housing costs. 'More realistic than rent prices coming down is rent prices stabilizing at a place where incomes can catch up,' Warnock said. For now, two trends in the market have emerged to keep the rental prices at a stable level: slowed rental demand and a recent construction frenzy. 'The past year has been really defined by a lot of new housing construction that was built over the previous three years, coupled with fairly low demand in the rental market,' Warnock said. 'As a result, what we see is that prices are largely flat, if not down.' There are only a handful of metros where rent prices have decreased over the past year. Notable among them is Bozeman, Montana, where people flocked during the pandemic for lower costs and outdoor spaces while working remotely. '(It) expedited everyone's decision-making to move to a town like Bozeman. There's a lot of fantasy around it,' said Casey Rose, an adviser at Sterling Commercial Real Estate Advisors. Amid the increased demand in the Montana mountain metro, developers started to build apartments. Many of the projects were delivered at the same time, which resulted in very low vacancy rates, Rose said. Compared with last year, rents in Bozeman are down roughly 10%, the second largest decline, according to the Apartment List data. But the actual prices, Rose said, can be masked by incentives like offering two months of free rent, or even a free iPad, TV, or ski pass. A similar pattern has played out in Austin, where rental prices are down 6.4% compared with a year ago. Stacey Auzanne, a property manager and a third-generation Austin resident, watched pandemic digital nomads flood into the city, while builders kept erecting new developments, creating a supply glut that kept rental prices suppressed. Auzanne, who manages dozens of properties, said the landlords she works with are holding rents steady, with one even dropping the price $50 a month. It's worth it to keep good tenants in place, she said – particularly in a market where there's more supply than demand. 'The market just kept accelerating and the bubble burst,' Auzanne said. 'This year, we're really feeling it.' Experts raised concerns that prices could go up because of the changing political landscape that has seen a stringent tariff policy and crackdown on immigrants who form a large part of the construction workforce. While housing inflation has dropped from its peak of over 8% in early 2023, costs have not fallen as quickly as overall inflation. According to consumer price index data released by the Labor Department on Wednesday, rent inflation was at 3.8% in May, the smallest annual increase since January 2022. This slowdown reflects lower rents for new leases finally filtering into rates for existing tenants. While the overall rise in consumer prices was modest in May, housing costs remained the largest contributor to inflation, accounting for 35% of all price increases. More: CPI report reveals inflation crept higher in May as tariff impact was tamer than expected This article originally appeared on USA TODAY: Rents remain far above pre-COVID levels. Check prices in your area

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