2011Oct3 Rolling Dice with Social Security

Social Security:

After years of being told that Social Security is "going broke" (probably not), or that it "won't be enough" (probably so), baby boomers are starting to realize that Social Security will be an important source of retirement income after all.

Baby boomers are redefining retirement in many ways, but the bedrock of most people's plans will be this 74-year-old program. There are many things that to consider when applying for Social Security;

Do you know how your benefits are calculated?

What is the effect if you retire between 62 and 65?

What is the effect if you retire between 66 and 70?

How does Cost of Living affect benefits?

How are spousal benefits calculated?

How does divorce or widowhood affect benefits?

What happens to benefits if you continue working?

How does a pension affect Social Security benefits?

How will my benefits be taxed?

For the answers to these questions along much more up to date information click here.

Markets: 

The fourth quarter continued right where the third quarter left off. With all of the uncertainty swirling around Greece remaining unresolved, global markets are still very wary of more bad news. Greece has said that they will be unable to meet the short term austerity targets set by the EU. They are hopeful that over the next year or so they can get closer, but that has been their stance all along. Sooner or later other European countries will need to see results, not promises.

All of our indicators remain negative. While we monitor them daily, none of them are showing signs of a sustained up trend. We will remain patient and be ready when things start to show some signs of life. 

 Outlook:

Here is the outlook from JEREMY SIEGEL, Professor of Finance, Wharton:

"I have indicated for a number of weeks that the incoming data do not confirm that the U.S. economy is entering a recession. This week's data put an exclamation point on that view. Today's much stronger than expected Chicago Purchasing Manager Index of 60.4 combined with much better-than-expected durable goods and jobless claims data reported Wednesday and Thursday, make the case. In fact, the durable goods data added some 4 tenths to estimates of GDP growth for the third quarter that ends today, which is running about 2%."

To be sure, there are some parts of the economy that are strengthening. We just need them to hang in there long enough for us to call it a trend. As always we will be listening to the signals and not trying to warp them into what we want to see.