Latest news with #retirement
The Sun
38 minutes ago
- Automotive
- The Sun
Motorbike fan quits job after scooping £4m lotto win and reveals dream purchase
A HARLEY-Davidson motorbike fan plans an easy ride into retirement after winning £4million on the National Lottery. Jon Waring, 57, has already handed in his notice as a police radio operator and nurse wife Lucy, 48, is also quitting. 2 The couple, who have a 15-year-old daughter, are set to splash the cash with a Harley trike topping Jon's shopping list, while a hot tub is Lucy's No1 priority. They also aim to buy a new family home in the area and create a music room in the house. Jon said: "This will be the perfect place to display the family's guitar collection - and potentially add to it too. "As a family, we love rock music and now the world really is our oyster - we hope to get the chance to attend gigs up and down the country. " This win will just enable us all to slow down, enjoy life - and of course hit that road on the sunny days ahead on our new trike." They do not have passports but are now looking forward to whichever holidays take their fancy. Reacting to his huge win in the Lotto draw on May 31 Jon said: 'I keep thinking I am going to wake up from a dream. Jon, who also hopes to go on a Lions rugby trip, added: 'It won't change us but it will change what we can do.' I almost died after freak surgery accident AND bus crash, now I've won £65k in lottery win 2
Wall Street Journal
an hour ago
- Business
- Wall Street Journal
The Social Security Iceberg Gets Closer
With all the enthusiasm of a madman, the U.S. continues to barrel toward history's most predictable crisis. Social Security is now expected to be insolvent in 2033, necessitating a 23% cut in benefits. The Medicare hospital fund will run out the same year, requiring an 11% spending cut. That's according to annual reports Wednesday by the official trustees. These projections are notably worse than last year's. The blow to Social Security benefits is two percentage points higher, and the default date is three quarters nearer. One factor cited by the trustees is that Congress, in its infinite generosity with other people's money, recently passed the deceptively named Social Security Fairness Act, topping up benefits for state and local government workers. The Medicare depletion day has moved three years earlier, owing to higher actual and expected costs. Those exact figures and dates move around somewhat, including based on how the economy is faring, so don't take them as gospel. But the larger picture, which has been obvious for years, is that America's retirement programs are on a unsustainable path and need to be reformed to be saved. Yet President Trump campaigned on never touching Social Security and Medicare. Perhaps he was sold a delusion that it would be possible to balance the books by going after fraud, such as all of those alleged 150-year-olds on benefits that Elon Musk kept insisting exist. Or maybe Mr. Trump thinks the political challenge is too great given that Democrats are utterly cynical in the way they accuse the GOP of pulling the plug on grandma.
Yahoo
2 hours ago
- Business
- Yahoo
What happens to an annuity if your insurance company goes broke?
Annuities are often marketed as a safe and reliable source of income, especially in retirement. They come with the promise of steady payments — a sort of paycheck replacement designed to offer peace of mind to risk-averse retirees. But what happens if the insurance company backing your annuity goes broke? While insurance insolvency is rare, it can happen. Here's everything you need to know if your annuity company goes broke. Annuity companies operate under strict regulations. They're required to hold substantial reserves to cover their obligations, including annuity payments. Despite these safeguards, life insurance companies can face insolvency. Insolvency occurs when an insurance company can no longer afford to pay out claims and doesn't have enough assets to cover its liabilities. Insurance companies can face insolvency for different reasons, including economic downturns, poor investment strategies, fraud or mismanagement. New to annuities? Annuities are complex and a bit different than other financial products. Learn how annuity fees and commissions work and the common annuity terms that every investor should know. If the insurance company issuing your annuity goes belly up, your principal and future payments aren't insured by the federal government, the way deposits of up to $250,000 are at FDIC-insured banks. Or the way the Securities Investor Protection Corp (SIPC) provides up to $500,000 to investors if their brokerage firm fails. While there's no federal safety net for annuities, state insurance guaranty associations offer some protection to policyholders. If an insurance company becomes insolvent, these associations can step in to cover some or all of your annuity benefits. Insurance is regulated at the state level, so federal laws like bankruptcy statutes typically don't apply to insurance companies. Instead, when an insurer becomes insolvent, the state insurance department intervenes and assumes control of the company. Liquidation is the last resort. It's only used when rehabilitation or other corrective measures fail to stabilize the company's finances. The process involves shutting down the business and selling its assets to pay off outstanding claims. Policyholders will be notified of the liquidation and provided with instructions on how to file a claim against the company's estate. Guaranty associations often take over from here. Guaranty associations are nonprofit organizations established by state law to protect policyholders from significant financial losses if their insurer becomes insolvent. When an insurance company fails, these associations step in to cover eligible claims that the insurer would have otherwise paid. All insurance companies are legally required to participate in these associations and contribute funds. Not all claims are covered though, and there are limits on how much an association will pay per claim. Maximum coverage varies by state, with $250,000 being a common limit for annuities. The amount of protection you qualify for is based on the present value of your future annuity benefits, according to the National Organization of Life and Health Insurance Guaranty Associations (NOLHGA). Learn more: Pros and cons of annuity investing If you learn that your annuity provider is in financial trouble, don't panic. Follow these steps. Verify the situation: If you receive a notice of receivership or liquidation from your insurance provider, confirm the status of your insurance company by contacting your state's department of insurance or the NOLHGA. Contact your guaranty association: Reach out to your state's guaranty association if you have questions about your specific situation. Here is a list of each state's guaranty association, along with contact information. Keep good records: Make sure you have all relevant documentation for your annuity on hand, including account balances, payment schedules, premiums paid and contract terms. Consult a financial advisor: Seek advice from a financial advisor who can help you navigate the insolvency process — it's complex. A fee-only financial advisor can also assess the impact on your retirement plan and help you explore alternative investment options. Be patient: The time it takes for a guaranty association to process and pay a claim varies, but payments typically start as soon as possible after an order of liquidation is issued. Sixty to 90 days can be common but be prepared for delays. In most states, if your benefits exceed the guaranty association's coverage limits — say you owned a $700,000 immediate fixed annuity and your state only covers up to $250,000 — the remaining amount turns into a claim against the insolvent insurer's estate. When the company's assets are sold off, you might get a slice of that back, however, it could take years. Though unlikely, if the insolvent company's estate doesn't have any assets, the guaranty association coverage is the only payout you'll receive, regardless of your account balance. Learn more: Annuity mistakes you do not want to make Insurance company failures are uncommon. These companies must comply with strict reserve requirements and file regular audits with state insurance regulators. Insurer insolvency rates have declined dramatically since the early 1990s, and in recent years, there's only been one or two cases per year on average, according to the National Organization of Life and Health Insurance Guaranty Associations. While rare, an annuity issuer failing can be a nightmare for policyholders. In 2019, four insurance companies owned by now-convicted fraudster Greg Lindberg — Southland National Insurance Corp., Colorado Bankers Life Insurance Co., Bankers Life Insurance Co. and Southland National Reinsurance Corp. — were placed under state rehabilitation by the Superior Court of Wake County, North Carolina. Roughly 70,000 holders of annuities totaling $2.2 billion were unable to withdraw their money for over four years as regulators worked to unwind the complex financial scheme and Lindberg delayed a liquidation through court appeals. That proved problematic for victims because state guaranty associations don't pay out until the company is in liquidation. Many who lost access to their money — either temporarily or forever — were retirees or risk-averse investors who bought annuities. Annuity policyholders of Colorado Bankers and Bankers Life only began receiving partial payments in September 2023. So while insurance company failures are less common now, for annuity owners even one failure can feel like too many if it's their insurer that goes bust. While the thought of your annuity provider going broke sounds alarming, the chances of it happening are low. If it does happen, protections are in place to safeguard your money. State guaranty associations provide an important safety net, ensuring annuity holders recover some or all of their funds. Sign in to access your portfolio
Forbes
2 hours ago
- Business
- Forbes
Whatever They Do, Don't Let Them Reform An ‘Insolvent' Social Security
Let's start with the obvious, now and in the future Social Security payments aren't remotely imperiled. It's said here over and over again, but rates saying once again, that the surest sign that present and future Social Security payments (including COLA increases) are safe and sound is the certain lack of a 'lockbox' or 'trust fund.' In the past, Social Security collections that weren't sent out to retirees were predictably spent by politicians who exist to spend. In the future, shortfalls in Social Security collections relative to outgoings will be paid for by general revenues flowing into Treasury. Which is why reform of Social Security, reduced benefits, or delayed retirement age promoted by the various Social Security alarmists and scolds would be such a bad idea. Yes, you read that right. Reform of Social Security would be an awful idea precisely because it would lead to bigger government. Outlandish? Not really. Stop and think about it. In thinking about it, let's be clear that Social Security, like Medicare, was itself a bad idea. Really bad. The very notion that we need or needed government to provide for retirement in a world and nation dense with all manner of financial services firms eager to put our savings to work in pursuit of retirement nest eggs insults foolish. Just think how much bigger all of our retirements would be if the U.S. Treasury hadn't been the recipient of so much of our earnings each paycheck, not to mention the equal amount contributed by our employers. Still, if there's a positive to Social Security it's that what's a bad idea has the potential to account for a growing share of federal dollars flowing out of Washington. The latter worries the Washington Post's Catherine Rampell, along with libertarians like the Cato Institute's Romina Boccia, but this situation should cheer those who prefer erecting roadblocks to government growth wherever we can find them. Rampell and Boccia worry about the federal government not having enough money to spend as Social Security accounts for a growing share of federal outlays, but perhaps at least Boccia could be convinced that this is a feature of Social Security's allegedly looming 'insolvency.' As is argued in my upcoming book The Deficit Delusion, the bigger the take of Social Security from general revenues, the fewer opportunities for politicians on either side to dream up new ways of spending our money. The simple, economy-sapping truth is that most government programs start out small, only to grow big. The growth is an effect of every program having at least one constituent on both sides of the aisle in Congress. Once sponsors can be found on both sides, it's hard to kill what shouldn't have been given life to begin with. So, while Social Security remains a bad idea, it's a bad idea that we all know, and that most of us have worked around. See the earlier comment about the density of financial service firms. Rather than give the political class new dollars to dream up new programs, it's better to simply allow Social Security to 'crowd them out.' So-called 'insolvency' can't come soon enough.
Yahoo
3 hours ago
- Business
- Yahoo
$3,000 superannuation boost coming for Aussies from July 1: 'Huge difference'
Superannuation will soon be paid on the government's parental leave payments. The change means Aussies could receive nearly $3,000 extra into their retirement fund, which could make a 'huge difference' over time. Parents with babies born or adopted after July 1 will receive the additional superannuation payment when they receive paid parental leave. This will be 12 per cent of their payment, in line with the super guarantee rate increase. UniSuper senior private client adviser Melinda Brown told Yahoo Finance the changes also coincided with paid parental leave increasing from 22 to 24 weeks. It will increase again on July 1, 2026, up to 26 weeks. RELATED Devastating superannuation tax reality hitting 50,000 Australians in growing trend Centrelink age pension changes coming into effect from July 1 $1,000 ATO school fees tax deduction that Aussies don't realise they can claim 'At the minimum wage and with the super contribution of 12 per cent, that's nearly $3,000 that's going to be put into their superannuation,' she said. 'Compounding over a number of years, it is going to make a huge difference. Especially as we know that women generally retire with 25 per cent less in superannuation than men.' Paid parental leave is based on the minimum wage, which will increase by 3.5 per cent to $24.95 per hour, or $948 per week, on July 1. The move is expected to improve the retirement balances of around 180,000 Australian families each year. In Australia, WGEA data found 68 per cent of employers offer access to paid parental leave on top of the government scheme. The majority (87 per cent) who offer paid parental leave also pay superannuation for parents while they are on leave. For workers who don't, Brown said it can be worth asking your employer if they will pay super during your leave. 'The more an employer is asked this question, the more they may decide to think about actually paying super on parental leave,' she said. If you are eligible for parental leave pay, the Australian Taxation Office (ATO) will pay a super contribution directly to your super fund. This is called the Paid Parental Leave Superannuation Contribution (PPLSC). If you share your parental leave, each parent will get the super contribution based on how many days they use. It will be paid automatically after the relevant financial year ends, starting from July, 2026. Brown said it was important for parents to take proactive steps to prepare their super before they go on parental leave. That includes checking your insurance, as inactive super accounts may lose cover unless you elect to keep it. 'That can happen if it's been over 16 months since you've had a contribution,' Brown told Yahoo Finance. 'So you can actually ask your super fund. There's usually a form where you can just elect to ensure that you do keep that cover.' It can also be worth considering voluntary contributions before or during your leave to help grow your super, or spouse contributions or splitting. 'At the end of each financial year, you can split the super contributions received from the employer so your concessional contributions, you can split to your spouse if you wish,' Brown said. "It's up to 85 per cent of the concessional contributions. So they do allow for the 15 per cent contribution tax, and it's also limited to the concessional cap.' If you have multiple super accounts, it could also be worth consolidating them to save on fees. You can get this through myGov. It may also be worth considering your investment mix and getting financial advice tailored to your circumstances. 'A lot of super funds these days do provide limited advice at no extra cost to you. So it can be a really good time to have a chat to your super fund about what services they can help you with,' Brown pour accéder à votre portefeuille
