Are you at least age 66? Check out “free spousal” benefits

You’ve likely been caught in the quandary of when you should begin taking Social Security benefits. It’s a tough decision. Taking them now can mean extra money hitting your bank account each month. On the other hand, each year you delay can give you an 8% bigger check from Uncle Sam for the rest of your life.

What should you do?

Well, if you are married, there is a way to get both: Checks right now and bigger ones in the future ...

The Social Security Administration will let you claim spousal benefits without forcing you to claim your own benefits. In other words, you are "free" to take a spousal benefit while letting your own retirement benefit continue to grow. You will receive a full spousal benefit equal to 50% of his or her retirement benefit. Then you can switch over to your own retirement benefit at a later age

However, you must be full retirement age (66 for most Boomers) for this strategy to work. Because if you are under full retirement age when you take a spousal benefit, it’ll be based on your record … not your spouse’s. Therefore, you will be stuck with a permanently lower benefit as a result of taking it prior to your full retirement age.

For more information, here is a link to the Social Security’s Retirement Planner.

 

Best wishes,

George

P.S. I’m on Twitter. Follow me at http://twitter.com/efinancialwrite for frequent updates, personal insights and observations on how to have a healthy retirement.

If you don’t have a Twitter account, sign up today at: http://www.twitter.com/signup and then click on the ‘Follow’ button from  http://twitter.com/efinancialwrite to receive updates on your cell phone or Twitter page.

Group long-term care insurance can save you a bundle

On page 80 of A Boomer’s Guide to Long-term Care I suggested seeing if your employer offers long-term care insurance as an employee benefit.

Here’s an example of the potential savings:

Anoka County, Minnesota gives its regular employees access to long-term care insurance through a voluntary program. With this municipal pool program, there is no cost to the county. And employees have the opportunity to purchase the insurance for as little as $16.54 a month for a 45-year-old.

According to the insurance industry trade group, LIMRA, the average 40- to 49-year old pays about $150 per month. So you can see that buying through your employer could be one heck of a deal. You might want to check it out.

Enjoy your weekend!

 

George

P.S. I’m on Twitter. Follow me at http://twitter.com/efinancialwrite for frequent updates, personal insights and observations on how to have a healthy retirement.

If you don’t have a Twitter account, sign up today at: http://www.twitter.com/signup and then click on the ‘Follow’ button from  http://twitter.com/efinancialwrite to receive updates on your cell phone or Twitter page.

National Retail posts outstanding 3rd quarter

1970-71 era

First of all, today is Veterans Day. So if you know a military veteran or see someone in a uniform, take a moment to say ‘Thank you.’

National Retail Properties (NNN) reported a 59.3% jump in third-quarter profit, as well as a 27.6% increase in revenue.

The REIT posted a net income of $33.3 million, or 30 cents per share, for the period ending September 30. That compared with net income of $20.9 million, or 24 cents per share, in the previous-year period

Revenue was $85 million for the third quarter … a huge jump from $66.6 million in the year-earlier period.

Here’s one more figure that got my attention: National’s portfolio had a 97.9% occupancy rate as of September 30, which compared with 97.4% as of December 31, 2011, and 97.2% as of September 30, 2011. This tells me that this REIT’s profits should continue to grow throughout 2013.

The REITs in the e-FinancialWriter portfolio are up 32.95% since inception, not including dividends.

REIT	Sector	Blog date	Price	Closing price 11/09/12	Return to date %	Dividend yield %
PSA	Self storage	3/14/2010	90.75	145.70	60.55	3.02
VTR	Health care	12/30/2010	52.87	63.69	20.47	3.89
HCP	Health care		36.81	44.15	19.94	4.53
HCN	Health care		47.53	58.64	23.37	5.22
IAECREIN:CN	Canada	9/27/2011	19.45cn	25.22cn	29.67	0
ZRE:CN	Canada		16.29cn	20.21cn	24.06	4.81
INVRLPRA:CN	Canada		5.45cn	5.56cn	2.06	1.23
NNN	Retail	1/29/2012	27.18	30.80	13.32	5.13
Index return since inception*					32.95
Avg dividend yield of REITs in portfolio					2.84

Source: Bloomberg

*Does not include dividends paid

Effective tomorrow, Monday November 12, I am removing the INVRLPRA:CN fund. It has not met expectations. Right now, there are better opportunities for income and growth in the residential rental REIT sector.  

If you have trouble seeing the chart, just in zoom in with your web browser.

Enjoy your weekend!

George

P.S. I’m on Twitter. Follow me at http://twitter.com/efinancialwrite for frequent updates, personal insights and observations on how to have a healthy retirement.

If you don’t have a Twitter account, sign up today at: http://www.twitter.com/signup and then click on the ‘Follow’ button from  http://twitter.com/efinancialwrite to receive updates on your cell phone or Twitter page.

How to buy rental houses without getting your hands dirty

Over the years I’ve done fairly well buying single family houses then renting them out. I was fortunate to have sold most of them by 2006, not long before the bubble popped. Now that prices seem to have hit bottom and mortgage rates are at historical lows, I think this could be a good time to get back in.

But to be honest, even though I think this sub-sector of real estate could be a good source of income with potential for appreciation along the way, I’m not sure I want to work that hard again. When you’re a small operator like I was with no more than 20 properties at any one time, you need to do most of the maintenance yourself.

Cleaning up after tenants move out, painting, patching holes in walls, fixing minor plumbing problems are just a few of the responsibilities you must assume. Plus you need to keep after tenants who don’t pay, even hauling them to court if needed.

So at this point in my life, you can understand why I’m a tad reluctant to jump back into the rental market.

However, in the near future there may be a way for me to invest in rentals without buying a house myself. And you might be interested, too ...

American Residential Properties is a real-estate investment company that buys, renovates, leases, and manages single-family houses. The Scottsdale, Arizona company operates as a private real estate investment trust (REIT), and recently sold $224 million worth of stock mainly to institutional investors. Now it is considering the idea of creating what I think is the first publicly traded REIT for single-family rental homes.

Two California companies, Waypoint Homes and Carrington Mortgage Holdings, are also looking into setting themselves up as publicly traded REITs investing in single-family rentals.

I’ll watch for further developments and post an update if something comes on the market.

Meanwhile keep this mind:

·         Hundreds-of-thousands of single-family homes are in foreclosure in many sections of the country

·         The homeownership rate has fallen over the past several years

·         For every percentage point drop in homeownership, the demand for rentals jumps by almost one million

·         A certain percentage of the population will always be renters because they have lousy credit, can’t come up with a down payment, or simply prefer to rent

Add them all up, and you can build a real good case for taking a close look at single-family rentals. And REITs could let you get in without the hassle of buying a house on your own.

Best wishes,

George

P.S. You can follow me on Twitter at: http://twitter.com/efinancialwrite for frequent updates, personal insights and observations on how to have a healthy retirement.

If you don’t have a Twitter account, sign up today at http://www.twitter.com/signup and then click on the Follow button from http://twitter.com/efinancialwrite to receive updates on either your cell phone or Twitter page.

Sandy teaches REIT investors a valuable lesson

Yesterday Forbes revealed that REITs own more than 1,600 properties in the areas affected by Sandy. What’s worse yet, though, is that six REITs have 50% or more of their portfolio in the devastated NYC metro area.

In fact, one REIT, Alexander’s Inc.(ALX) has 100% of its primarily retail portfolio there.

The lesson to be learned: Make sure the REITs you invest in are geographically well diversified.

Click here to read the complete Forbes article.

George

P.S. You can follow me on Twitter at http://twitter.com/efinancialwrite for frequent updates, personal insights and observations on how to have a healthy retirement.

If you don’t have a Twitter account, sign up today at http://www.twitter.com/signup and then click on the ‘Follow’ button from http://twitter.com/efinancialwrite to receive updates on either your cell phone or Twitter page.

Obama and Romney vs. Long-term Care. Guess Who Loses?

The Presidential election is only 12 days away. Yet I haven’t heard a peep out of Obama or Romney about long-term care.

Romney has said he’ll cut programs that support the elderly and give states more flexibility in how they offer these services. His cap on Medicaid spending would mean big cuts in long-term care.

Obama claims he won’t change a thing and of course has criticized Romney’s cuts while he’s hanging out at retirement communities begging for votes. It sounds good, but he doesn't have a plan on how to pay for it. Not a clue.

His CLASS Act as part of Obamacare was designed to be a national voluntary long-term care insurance program but never got off the ground. It was an absolute failure before the ink was even dry. Just like I predicted it would months before he threw in the towel.

So where does this leave you … the retiree or the soon-to-be retiree who may be concerned what will happen if your health changes?

Apparently long-term care is not a priority for either candidate. Therefore, no matter who wins on November 6, you are on your own. And the sooner you come up with a strategy, the better. If you’re not sure where to begin, pick up a copy of my book, A Boomer’s Guide to Long-term Care.

Best wishes,

George

P.S. I’m now on Twitter. Follow me at http://twitter.com/efinancialwrite for frequent updates, personal insights and observations on how to have a healthly retirement.

If you don’t have a Twitter account, sign up today at http://www.twitter.com/signup and then click on the ‘Follow’ button from http://twitter.com/efinancialwrite to receive updates on either your cell phone or Twitter page.

IRS ups LTCI premium deductions

In A Boomer’s Guide to Long-term Care I included a section on the deductibility of long-term care premiums.

The IRS limits the amount you can include in the deduction calculation based on your age. And it just increased the amounts for 2013 to:

• Age 40 and under – $360
• Age 41 to 50 - $680
• Age 51 to 60 - $1,360
• Age 61 to 70 - $3,640
• Age 71 or over - $4,550

However, your policy must meet special guidelines. For the fully story, plus tips on how to save on your insurance premiums, download your copy of A Boomer’s Guide to Long-term Care today for just $9.95.

Enjoy the rest of your weekend!  

George

P.S. I’m now on Twitter. Follow me at http://twitter.com/efinancialwrite for frequent updates, personal insights and observations on how to have a healthly retirement.

If you don’t have a Twitter account, sign up today at http://www.twitter.com/signup and then click on the ‘Follow’ button from http://twitter.com/efinancialwrite to receive updates on either your cell phone or Twitter page.

National Retail Properties declares dividend

National Retail Properties (NNN), one of the REITs in the e-FinancialWriter portfolio, declared a quarterly dividend of 39.5 cents per share payable November 15, 2012 to common shareholders of record on October 31, 2012. The dividend represents an annualized rate of $1.58 per share.

It is interesting to note that National is one of only four publicly traded REITs and 104 publicly traded companies in America to have increased annual dividends for 23 or more consecutive years. And its dividend growth rate over the past three years is 1.11% vs. -7.31% for the industry’s average.

National invests primarily in high-quality retail properties subject generally to long-term, net leases. As of June 30, 2012, the company owned 1,506 Investment Properties in 47 states with a gross leasable area of approximately 17.8 million square feet.

Since adding it to the Portfolio on January 29, 2012, it is up 17%.

The next earnings announcement from National is expected the week of November 5, 2012.

Best wishes,

George

Long-term care insurers running scared

Moody’s Investors Service reported that long-term care insurance faces an uncertain future because firms may find it difficult to profit from the product.

Laura Bazer, a vice president at Moody’s, issued this statement,

“Key credit considerations for the sector are the relative newness of long-term care insurance and the long-tailed and complex product structure, which make it difficult to price the product profitably.”

Genworth Financial Inc. has said it’s raising prices for the coverage, while the largest U.S. life insurers, led by MetLife Inc. and Prudential Financial Inc., are retreating from selling long-term care coverage.

So does this mean you should throw your hands up and forget about protecting your nest egg from soaring long-term care costs?

Heck no!

What it DOES mean is that you have to weigh your options even more closely. And the best place to begin is by picking up your copy of my updated and expanded edition of A Boomer’s Guide to Long-termCare.

Inside, I’ll show you what to look for in long-term care insurance policies and alternatives in case insurance is not for you.

Downloadyour copy here, right now.

Best wishes,

George

4 Reasons I like REITs So Much

San Gerardo de Dota, Costa Rica

I’ve written many times that I like real estate. I like stocks, too. But real estate helps reduce the risk of investing in the volatile stock market because it does not always move in tandem with other equities.  

And when friends or clients ask why I am especially fond of real estate investment trusts (REITs), I sum it up with four reasons: 

#1— Diversification

REITs own a basket of properties. Not just six or seven, often there will be several hundred in their portfolios. These holdings could be concentrated in one or two regions in the U.S., such as the Northeast, or throughout the whole country. 

#2— Income

REITs can generate a regular stream of income from the rent they collect from tenants. Then, by law, they must pay out at least 90% of their taxable income to shareholders. This has historically put REIT dividend yields considerably higher than average yield for the S&P 500 Index.

#3— Protection against Inflation

Real estate values and rents have historically risen along with inflation in our country. In fact, in all but two of the last 20 years, REITs’ dividends have beaten the Consumer Price Index.

#4— Total Return

When you combine strong, consistent dividends along with stock price appreciation, REITs have provided investors with higher returns than most other equities and bonds.

The proof: The FTSE NAREIT All Equity REIT Index has outpaced the S&P 500, the Nasdaq Composite, the Dow, and the Russell 2000 indices over the last 1-, 3-, 5-, 10-, 15-, 20-, 25-, 30-, 35-, and 40-year periods ending June 30, 2012.

That a pretty impressive record, if you ask me.

Best wishes,

George

P.S. I’m on Twitter. Follow me athttp://twitter.com/efinancialwrite for frequent updates, personal insights and observations on how to have a healthy retirement.

If you don’t have a Twitter account, sign up today athttp://www.twitter.com/signup and then click on the ‘Follow’ button from http://twitter.com/efinancialwriteto receive updates on either your cell phone or Twitter page.

REIT portfolio update

The REITs in the e-FinancialWriter portfolio continue performing well: Up 25.37% over the past 12 months and up 35.70% since inception, not including dividends.

REIT	Sector	Blog date	Price	Closing price 09/07/12	Return to date %	Dividend yield %
PSA	Self storage	3/14/2010	90.75	146.82	61.79	2.89
VTR	Health care	12/30/2010	52.87	65.04	23.02	3.74
HCP	Health care		36.81	46.64	26.70	4.25
HCN	Health care		47.53	58.66	23.42	5
IAECREIN:CN	Canada	9/27/2011	19.45cn	25.76cn	32.45	0
ZRE:CN	Canada		16.29cn	20.74cn	27.32	4.83
INVRLPRA:CN	Canada		5.45cn	5.54cn	1.70	1.86
NNN	Retail	1/29/2012	27.18	31.12	14.50	4.98
Index return since inception*					35.70
Avg 12-mo return of REITs in portfolio*					25.37
Avg dividend yield of REITs in portfolio					3.44
12-mo return S&P REIT index as of 08/31/12*					16.6
12-mo return S&P 500*					24.58

Source: Bloomberg

*Does not include dividends paid

If you have trouble seeing the chart, just in zoom in with your web browser.

Enjoy your weekend!

George

P.S. I’m on Twitter. Follow me at http://twitter.com/efinancialwrite for frequent updates, personal insights and observations on how to have a healthy retirement.

If you don’t have a Twitter account, sign up today at http://www.twitter.com/signup and then click on the ‘Follow’ button from http://twitter.com/efinancialwrite to receive updates on either your cell phone or Twitter page.