Retirement News : Seniors : One woman's retirement options

One woman's retirement options

Date Added: 31-03-2005

WASHINGTON - Pamela Ginsberg was once invited to a bar mitzvah by a customer and danced the hora in the family circle. At the grocery store where she works as a butcher, she has blanketed part of a wall behind the deli counter with photos and hand-scrawled notes from children she has treated to slices of turkey. When she serves customers, she stands beneath a flying wooden cow and pig - gifts from a man who could not get enough of her corned beef.

These are the reasons Ginsberg lists for why she likes working at the Brookeville Market in Washington. "It's my life," said Ginsberg, who is the store's kosher and specialty foods buyer. "These people are my customers, but they treat me like family."

But no pension or 401(k) plan comes attached to her job. She is 41 and has $7,000 in the bank. Her annual salary of about roughly $40,000 might seem reasonable for a single person with no children, no car and no debt, but increasingly Ginsberg frets about what her finances will look like when she stops carving cutlets.

She has reason to be concerned. A review of Ginsberg's finances by three financial planners indicated she needs to make big changes right away, cutting her few indulgences, and investing as much as possible. Even then, they say, she is likely to run out of money and be dependent on Social Security.

Since President Bush outlined his plan to partially privatize Social Security, Ginsberg said, she has followed the debate attentively, aware that she is in the age group most likely to be caught in the middle -too young to be protected from benefit cuts, too old to fully bounce back if private accounts don't generate the expected returns.

"I've read everything I can get my hands on," Ginsberg said, noting that her perceptions about retirement were shaped by seeing her mother live comfortably on Social Security and a veterans pension after her father died. "I grew up thinking I would have Social Security to live on."
According to her latest Social Security statement, if Ginsberg continues working until age 65, she can expect to receive $950 a month, just shy of today's average monthly Social Security benefit of $955. That is enough to cover the rent she presently pays for a one-bedroom apartment in Adams Morgan, but it would leave her short for food, utilities and other necessities.

Retirement planning, Ginsberg acknowledges, has suddenly become an urgent matter.

In that she is not alone. As of 2001, a federal analysis of households with at least one worker from age 21 to 64 concluded 28 million -more than one-third of the total -did not have any retirement savings account. The study, released in 2003, relied on Census Bureau and Federal Reserve data.

From now until she retires, Ginsberg and millions of others may be asked to absorb the benefits cuts and tax increases many experts say are necessary to ensure long-term solvency of a Social Security system projected to fall short by 2041 of money needed to pay 100 percent of expected benefits.

Mary Malgoire, of the Family Firm in Bethesda, Md., and Stuart Ritter, of T. Rowe Price in Baltimore, came up with general advice. Alexandra Armstrong and associates at Armstrong, MacIntyre & Severns in the District ran detailed projections based on three scenarios.

All three agreed Ginsberg must make changes now if she wants to maintain her standard of living in retirement. Though they estimated she has only $7,000 in disposable income each year, after taxes, rent and utilities, they said she needs to begin saving and investing in the stock market.

"I've read everything I can get my hands on," Ginsberg said, noting that her perceptions about retirement were shaped by seeing her mother live comfortably on Social Security and a veterans pension after her father died. "I grew up thinking I would have Social Security to live on."
According to her latest Social Security statement, if Ginsberg continues working until age 65, she can expect to receive $950 a month, just shy of today's average monthly Social Security benefit of $955. That is enough to cover the rent she presently pays for a one-bedroom apartment in Adams Morgan, but it would leave her short for food, utilities and other necessities.

Retirement planning, Ginsberg acknowledges, has suddenly become an urgent matter.

In that she is not alone. As of 2001, a federal analysis of households with at least one worker from age 21 to 64 concluded 28 million -more than one-third of the total -did not have any retirement savings account. The study, released in 2003, relied on Census Bureau and Federal Reserve data.

From now until she retires, Ginsberg and millions of others may be asked to absorb the benefits cuts and tax increases many experts say are necessary to ensure long-term solvency of a Social Security system projected to fall short by 2041 of money needed to pay 100 percent of expected benefits.

Mary Malgoire, of the Family Firm in Bethesda, Md., and Stuart Ritter, of T. Rowe Price in Baltimore, came up with general advice. Alexandra Armstrong and associates at Armstrong, MacIntyre & Severns in the District ran detailed projections based on three scenarios.

All three agreed Ginsberg must make changes now if she wants to maintain her standard of living in retirement. Though they estimated she has only $7,000 in disposable income each year, after taxes, rent and utilities, they said she needs to begin saving and investing in the stock market.

"I've read everything I can get my hands on," Ginsberg said, noting that her perceptions about retirement were shaped by seeing her mother live comfortably on Social Security and a veterans pension after her father died. "I grew up thinking I would have Social Security to live on."
According to her latest Social Security statement, if Ginsberg continues working until age 65, she can expect to receive $950 a month, just shy of today's average monthly Social Security benefit of $955. That is enough to cover the rent she presently pays for a one-bedroom apartment in Adams Morgan, but it would leave her short for food, utilities and other necessities.

Retirement planning, Ginsberg acknowledges, has suddenly become an urgent matter.

In that she is not alone. As of 2001, a federal analysis of households with at least one worker from age 21 to 64 concluded 28 million -more than one-third of the total -did not have any retirement savings account. The study, released in 2003, relied on Census Bureau and Federal Reserve data.

From now until she retires, Ginsberg and millions of others may be asked to absorb the benefits cuts and tax increases many experts say are necessary to ensure long-term solvency of a Social Security system projected to fall short by 2041 of money needed to pay 100 percent of expected benefits.

Mary Malgoire, of the Family Firm in Bethesda, Md., and Stuart Ritter, of T. Rowe Price in Baltimore, came up with general advice. Alexandra Armstrong and associates at Armstrong, MacIntyre & Severns in the District ran detailed projections based on three scenarios.

All three agreed Ginsberg must make changes now if she wants to maintain her standard of living in retirement. Though they estimated she has only $7,000 in disposable income each year, after taxes, rent and utilities, they said she needs to begin saving and investing in the stock market.

For More Information:

http://www.concordmonitor.com/apps/pbcs.dll/article?AID=/20050330/REPOSITORY/503300332/1003/BUSINESS