Get Your Ducks in a Row

It is never too early, or too late to start saving for your retirement. The first step is understanding your current budget. Once you know how much you are spending in a month, you can figure out how much you can afford to save, or ways to increase your savings.

WISER’s retirement income worksheet, called Get Your Ducks in a Row, will help you to organize each of your sources of retirement income, so there is no guesswork as to how much retirement income you will receive each month. It is an easy-to-use tool that considers all of your benefits, such as Social Security, Employer Pensions, as well as contributions from part-time work. The worksheet also distinguishes which sources will keep up with inflation, and which will not.

This useful tool, as well as many other financial and retirement planning resources are available on WISER’s website.

Test Your Financial Prowess

How much do you know about retirement security? Find out by taking this quiz from the Wall Street Journal:

1) What percentage of surveyed workers said that—in the wake of the financial crisis—they still plan to retire on their original schedule?

a. 21%
b. 31%
c. 41%
d. 51%

(ANSWER: b. Only about one-third of workers, according to a survey in September by Bankrate Inc., said the recession hasn't affected their planned retirement date. One in five said they anticipated leaving the office between one and five years later than planned.)

2) An analysis of trading behavior over a two-year period in 401(k) plans found that the greatest percentage of workers made a change in their accounts:

a. Once during the two years
b. Twice during the two years
c. Once each quarter
d. Twice each year
e. Never made any change

(ANSWER: e. Looking at a group of 1.2 million workers in more than 1,500 retirement plans, a report from the University of Michigan found that 80% of workers initiated no trades in their accounts during the two-year period. Eleven percent made only one trade."For the overwhelming majority of retirement savers," according to the report, "there is no evidence of portfolio rebalancing, shifts in risk tolerance with age, or tactical portfolio changes.")

3) What percentage of participants age 55-64 in employer retirement programs made the maximum contribution to their accounts in 2008—and what percentage of workers age 50-plus took advantage of catch-up contributions?

Maximum Catch-up
a. 10%a. 13%
b. 20%b. 23%
c. 30%c. 33%
d. 40%d. 43%

(ANSWERS: B (maximum) and A (catch-up). Vanguard Group, in a survey of its defined-contribution plans, with more than three million participants, found that only one in five workers approaching retirement made the maximum contribution to their employer savings accounts—and only one in seven workers took advantage of catch-up contributions. )

4) What percentage of workers and/or their spouses have tried to calculate how much money they will need to save for a comfortable retirement?

a. 34%
b. 44%
c. 54%
d. 64%

(ANSWER: B. Fewer than half of surveyed workers in 2009, according to the Employee Benefit Research Institute, had put pencil to paper—a fundamental step in any effective retirement plan. The same percentage said they simply guessed at how much money they will need in later life.)

5) In retirement, Social Security will likely replace what percentage of your pre-retirement income?

a. 23%
b. 33%
c. 43%
d. 53%

(ANSWER: b. Thus, the question: If Social Security, according to the agency's board of trustees, will provide approximately one-third of the amount needed for retirement, will your savings and assets be sufficient to generate the balance?)

6) The single best cure for a battered nest egg is to:

a. Invest more aggressively
b. Save more money
c. Work longer
d. Plan to withdraw less money from retirement savings

(ANSWER: c—for many people. There is, of course, no single best answer for patching a nest egg. A combination of two or more of these tactics probably would help many current and would-be retirees.)

* WISER has many resources to help you plan for your secure retirement, including a worksheet to help you add up your sources of retirement income as well as a general budget sheet to help you get on track today!

Source: Ruffenach, Glenn. “Have You Learned Your Lessons?” 14 Nov. 2009. The Wall Street Journal, Personal Finance. .

No COLA this year??

The Social Security Administration’s announcement that it will not be providing Cost of Living Adjustment increases to its beneficiaries has caused quite a stir among seniors, nonprofits, and members of Congress. Here are some basic facts about the COLA itself, the implications of not having an increase, and the possibilities for other funding for Social Security beneficiaries.

Social Security benefits are adjusted each year to fit the cost of living increase measured by the Consumer Price Index. Because there has been inflation every year since 1975, there has also been an increase in social security benefits to help elders with the increased costs of living. This year, however, as a result of the economic crisis, the cost of living actually decreased. Thankfully, Social Security benefits are never smaller than they were the year before, but that means this year benefits will be the same as last year (no COLA/increase).

Even though the CPI measurement shows that the cost of living did not increase in the past year, elder advocates remind Congress that the economic crisis has hit seniors, as they pay high costs for healthcare and prescription drugs, and have few, if any, years of work to rebuild lost retirement savings. Because women live longer than men and have lower incomes due to time out of the workforce to provide caregiving and other duties, elder women are at a high risk of poverty.

President Obama is supporting a bill to provide $250 to seniors, veterans, and individuals with disabilities to make up for the lack of a COLA. The bill is called the Emergency Senior Citizens Relief Act of 2009 (H.R. 3597, S. 1685). President Obama’s proposed legislation would cost between $13 and 14 billion, but Social Security Commissioner Michael Astrue believes this payment is necessary to protect elders against medical costs that have increased “at a rate of inflation much higher than any other commodity.”

Opponents of the bill maintain that giving elders money even though the cost of living has not increased, will begin to transform the Social Security system into a welfare program. The COLA was designed precisely to increase only when inflation increased, and since that did not happen, seniors technically can purchase more with their benefits this year than last year. It is not Social Security’s responsibility to make up for the shortcomings of the overall economy, and beginning to compensate seniors in this way transforms the entire program from an earned benefit program to a welfare program. Finally, the country’s deficit is already large enough, without adding billions of dollars to the national debt. For these reasons, to opponents, Obama’s bill is unjustified and unnecessary.

Regardless of whether you support or oppose Obama’s bill to provide funding for seniors this year, those are the basic facts about the COLA in our Social Security program. Check back for updates on the bill!

Don’t Be a Statistic; Start Planning Your Financial Future!

The Census Bureau’s newly released numbers highlight the challenges that almost all Americans are facing when trying to reach a financially stable retirement, and this challenge is even greater for women. A few findings from the report are as follows:

• The wage gap between men and women grew between 2007 and 2008. Median earnings for women in 2008 were just $35,745, while median earnings for men totaled $46,367. Women are earning only 77 percent of what men earn, down from 78 percent in 2007.

• The poverty rate increased this year also: the 2008 poverty rate was 13.2 percent, up from 12.5 percent in 2007. This is the first significant increase in the poverty rate since 2004.

• The income deficit, the difference between a family’s income and the poverty line, for families in poverty increased between 2007 and 2008. This income deficit was largest for families with female headed households ($9,638). (Income, Poverty, and Health Insurance Coverage in the United States: 2008)

Women clearly have many obstacles to overcome when planning for a secure retirement. According to a WISER Special Report, The Pay Gap is Connected to the Retirement Gap, almost half of all women work in lower-paying jobs that do not offer retirement plans or 401(k)s.

In addition, women take, on average, 12 years off of work to provide caregiving. While women are busy taking care of family members, they lose years of income to add to their Social Security benefits and retirement plans.

What Can you Do About it?

While these statistics may seem daunting, there are lots of things women can do to start taking control of their financial futures, and the best time to start is now!

Want an easy way to get on the right track? Check out WISER’s website to learn about saving and investing strategies. Educating yourself is a crucial step in planning your secure retirement!

Savvy Saving for Young Women

With the economy currently in recession and unemployment on the rise, it is vital for young people, especially young women, to start saving early. Job security is never a guarantee, so ladies, it's a good idea to become savvy with your spending and saving early.

Whether you're still in college or fresh into a job, it's essential to put some money aside each month. Investing in a mutual fund or U.S. Savings bond is a good idea, and the sooner you start the better, so the interest can compound for more years. Consider setting up and automatic withdrawal of $50 a month or more from your paycheck or checking account into your savings.

If you're still in college, collegescholarships.org offers several good tips on how to live on a budget while saving for the future.

After graduation and newly employed means a steady paycheck, but don't let this be a reason to spend more. Check out nextstudent.com to learn how to live on a budget, happily, while saving for the future.

Beth Kobliner's newly revised and updated Get a Financial Life examines personal finances in your twenties and thirties. Kobliner also discusses ways to get out of debt, save for your first home, and how to invest wisely with little money. Check out this review by USA Today.

Whether you're young and employed or still getting an education, don't put off saving. Start today.

5 Questions to Ask Your Mother or Grandmother

May is Older Americans Month, and for many of us, the most important older Americans are our own parents and grandparents. Although thinking about retirement is difficult for everyone in these tough financial times, it is particularly important for women, who too often live out their retirement years in precarious financial straits.

This month, take time to help yourself - and those you love - plan for a more secure retirement. Start by asking your mother or grandmother the following questions, following up with suggestions found in the complete version. Together you may find some solutions that will make both of your lives better.

5 Questions to Ask Your Mother or Grandmother

1. Can you make ends meet; are you worried about depleting all of your savings?

2. Do you have a competent tax and financial advisor?

3. Are you struggling with prescription drug costs?

4. Are you getting all the medical care you need?

5. Have you been approached to get involved in charitable contributions, investment schemes, business ventures or loans that seem questionable?

To read the entire fact sheet, visit The National Education and Resource Center on Women and Retirement Planning at wiserwomen.org.

Happy Older Americans Month!

Retirement Insecurity, a new report by The New Hampshire Women’s Policy Institute and underwritten by WISER, examines the financial status of New Hampshire’s older women and recommends state-level policy changes that could increase savings for current and future generations. The report provides the first-ever in-depth analysis of the financial status of New Hampshire’s women aged 65 and older. Among the paper’s major findings are: 

·         Women’s lower income during retirement years is driven by a disparity in lifetime earnings between women and men due to differences in pay rates, labor force participation in full-time and part-time work, as well as women’s primary role as caregivers in society. The estimated lifetime cost of caregiving is $659,139. 

·         New Hampshire women 65 and over who live alone have the lowest incomes among the state’s older population and are at the greatest risk of not being able to pay housing or health care costs. Sixty-two percent of older women living alone have incomes below what is needed to cover basic costs of living. 

·         The Institute estimates an older women living alone needs approximately $20,000 per year to cover the basic costs of living, just over twice the federal poverty level. Approximately 28,000 women 65 and over in New Hampshire had household incomes below that level in 2007. 

·         The lack of financial security is a major driver for public benefit programs as New Hampshire residents age. Is estimated that Medicaid spending on women aged 65 and over in 2020 is expected to cost New Hampshire taxpayers $330 million.

·         There are a range of policies and activities which can be implemented now, many with minimal immediate cost that will help to ensure that the women of New Hampshire are able to live out their lives in the homes of their choosing and as a continued social, economic and political force in their communities.

 For more information, go to http://www.nhwpi.org/, or download the Retirement Insecurity Fact Sheet. To access the 30-page report pdf, click here. 

Blog About It: Elder Economic Security

Today marks the start of Older Americans Month. WISER is partnering with Wider Opportunities for Women on its National Elder Economic Security Initiative: What does elder economic security mean to you? We encourage you to answer this question by leaving a comment on WISER's blog, or on the National Elder Economic Security Blog. 

Old Age Is No Place for Sissies

Life Expectancy

While a long life can be a wonderful gift, a long life in poverty or near poverty is not so wonderful. Today, an average woman’s life expectancy at birth is 80.4 years, compared to 75.2 years for an average man. If a woman lives to age 65, she can expect to live until age 85 ― about three years longer than a 65-year-old man. 

Marital Status

Many widows face poverty for the first time in their lives. Between the ages 75–84, only 34 percent of women are married with their spouse present. For women aged 85 and older, only 13 percent are married with their spouse present. In contrast, 70 percent of men aged 75–84 and 56 percent aged 85 and older are married with a spouse present.

With the death of a spouse, women often experience a steep drop in income. When a woman becomes a widow, she stands to lose a significant amount of income from her spouse’s pension and even from Social Security.

Poverty

The poverty rate for all women age 65 and older is 12 percent. Single women in this age group are at a much higher risk of poverty. Over 20 percent of single white women are living in poverty; the rate is double for single African American and Hispanic women. 

Portion of Single Older Women Who Are Poor and Near Poor
	Below 100% of Poverty (Threshold $9,669)	Below 150% of Poverty (Threshold $14,504)	Below 200% of Poverty (Threshold $19,338)
Age
65+	19.1	45.9	61.5
65-74	18.4	38.6	53.4
75+	19.5	47.1	66.5
Note: The poverty thresholds shown in this table are for 2007,  calculated in 2008.  Source: CPS, Table POV 01, 2008.

Retirement Income

The median annual income for women age 65 and older is not quite two-thirds of what men the same age are receiving ($14,021 compared to $22,323). Social Security is intended to replace approximately 40 percent of an average earner’s wages, but many women rely on it as their primary or only source of retirement income. This is one of the major reasons why so many women are poor or near poor.

In theory, women should be saving more money than men because they live longer and will need money to support themselves and pay for the rising cost of health care and prescription drugs.  Yet in reality, they are not able to save the vast amounts that are needed due to diverse work patterns and caregiving responsibilities that require them to move in and out of the paid labor force or to work at part-time jobs where they are less likely to have retirement plans or savings.

As a result, millions of women are vulnerable to outliving their assets and facing the real possibility of poverty.

We can hope that public policymakers will adopt changes to prevent poverty in old age, such as providing caregiver credits, improving the Saver's Tax Credit, developing a better system of financing and providing long-term care. However, women must learn to make the most of the existing system and make the best financial decisions toward securing their futures. 

So, what does Elder Economic Security mean to you? 

Why does she earn less?

Yesterday, Tuesday, April 28 was Equal Pay Day. 

Today, 56 percent of working women earn less than $30,000 a year and only 7 percent earn more than $75,000; in contrast, 39 percent of men earn less than $30,000 and 18 percent earn more than $75,000. Women, on average, are paid 78 cents for every dollar a man makes.  For those ages 65 and older, the income gap between women and men is even larger—older men’s median annual income was almost twice that of older women ($23,500 and $13,603 respectively).   

So, why does she earn less? 

Part of the wage gap between the sexes is the result of differences in education, experience, or time spent out of the paid workforce; but a significant portion of the gap cannot be explained by any of these factors, and may simply be the result of wage discrimination. Working women pay a steep price for unequal pay. The typical working woman with a college degree will make about $500,000 less in wages over her lifetime than an equivalent male—an amount that could provide a comfortable retirement nest egg.

Take Action

From The National Committee on Pay Equity—Urge your senators to support the Paycheck Fairness Act:

The House passed the Paycheck Fairness Act to strengthen enforcement of the Equal Pay Act on January 9, 2009. Please urge your senators to support S.182. The Paycheck Fairness Act would ensure effective remedies for wage discrimination and make it easier to sue on behalf of groups of women. Read NCPE's Feb. 23, 2009 letter to senators urging quick action on the Paycheck Fairness Act (S.182). 

(http://www.pay-equity.org/PDFs/Letter-to-Senate-PFA2-23-09.pdf)

For more on the gender wage gap, go to http://www.pay-equity.org/. 

WISERWoman & Long-Term Care

What comes to mind when someone uses the term "long-term care"? Do you picture a nursing home or a hospital? Long-term care includes a broad range of health and support services that people need as they age or if they are disabled, including personal care and assistance with daily tasks such as eating, dressing and bathing. The latest issue of WISERWoman highlights long-term care, examines its costs and explores long-term care insurance as an option. For women, who are more likely to live alone in old age, it is crucial to begin asking the tough questions related to long-term care: Who will provide care? How will I pay for it? Should I buy LTC insurance?

Read it here.

Find Out More: Viaticals Resource Guide

This week, we chatted with WISER Senior Policy Analyst Laurel Beedon about Viaticals. If you still have questions on viaticals or you're just looking for more information, here's WISER's list of Viaticals resources:

American Council on Life Insurance
1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2599
www.acli.org

National Association of Insurance Commissioners
444 North Capitol Street, N.W.
Washington, DC 20001
www.naic.org

National Association of People with AIDS
1413 K Street, N.W.
Washington, DC 20005
www.napwa.org

National Viatical Association
1200 G Street, N.W., Suite 760
Washington, DC 20005
www.nationalviatical.org

For more information, you can also contact your state insurance commissioner or state attorney general. The National Association of Insurance Commissioners has state-by-state contact information for insurance commissioners here.

WISER Celebrates America Saves Week!

This week is America Saves Week. All over the country, individuals and organizations are using this week to rededicate themselves to saving and paying down debts. Many are worried about their retirement. These issues are especially important for single women. Women live longer and earn less than men; they are also more likely to remain single, to be widowed or divorced and vulnerable to poverty.

For America Saves Week, WISER has new resources for women who are going through a divorce or who have been widowed. WISER’s guide, “Divorce and Retirement: Take Control of the Retirement Benefits,” helps women navigate the complicated world of dividing retirement benefits at divorce, while “WISER’s Report on Widowhood” offers financial tips for widows of all ages.

Spare Change: Stimulus Act Offers Premium Assistance COBRA Beneficiaries

Beginning March 1, 2009, the government will subsidize 65% of the cost of COBRA premiums for eligible workers and their dependents who were/are involuntarily terminated between September 1, 2008 and December 31, 2009 for up to nine months. The subsidy is available as long as the person's adjusted gross income is $125,000 or less ($250,000 or less for joint filers). It is phased out as adjusted gross income increases from $125,000 to $145,000 ($250,000 to $290,000 for joint filers), so that there is no subsidy at all above those levels.

For those who did not initially elect COBRA coverage, the legislation also provides an additional 60 day election period.

Q&A: Viaticals

This week, the WISER blog writers had a Q&A session with WISER's Senior Policy Analyst, Laurel Beedon, on Viaticals. A viatical is a legal document that sells your life insurance policy to a third party.

Q:Why would I sell my life insurance?
A: A viatical can provide needed money if you are terminally or chronically ill and in a difficult financial situation.

Q: Who is involved?
A: You, as a terminally or chronically ill person sell your life insurance policy to an investor in return for a lump-sum payment. The investor then takes over payments on the policy and is the beneficiary of the policy upon your death. Usually, a viatical broker arranges the agreement between you, the seller of the policy, and the buyer using a viatical purchase agreement. The broker is paid a commission.

Q: What should I find out?
A: If you are considering a viatical, it is important to ask some questions and learn about all the options on your life insurance policy before you make your decision.

Here are some questions to ask and people to check with before you decide on a viatical:

• Do you have any cash value in your life insurance policy? If so, you may be able to use some of the cash value to meet your immediate needs and still keep your policy in force for your beneficiaries without having to sell it to a third party.


• Does your life insurance carrier offer accelerated death benefits? Those benefits could pay you a substantial portion of your policy’s death benefit and you wouldn’t have to sell your policy to a third party.


• Will your receipt of cash from a viatical agreement be taxed? Check with your financial or tax advisor.


• Will you lose any public assistance or social service benefits such as food stamps or Medicaid if you receive a cash settlement?


• Will buyers of your policy be able to learn your identity and will they know certain medical and personal information about you, such as your address and life expectancy?

Before you make any major decisions, you may also want to consult your own financial advisor or attorney. Shop around. Talk with several companies and/or brokers to find the best arrangement. Don't fall for high pressure tactics. You don't have to accept an offer, and you can change your mind. Check with your state insurance department to verify the company or broker you are considering is licensed. Check with your state attorney general’s office for complaints against the company.

Tomorrow: Find Out More: Viaticals Resource Guide

Financial News You Can Use

-On February 17, 2009, President Obama signed the American Recovery and Reinvestment Act of 2009. This new legislation provides a one-time payment of $250 to Social Security and Supplemental Security Income beneficiaries. Over 60 million beneficiaries will receive a one-time payment. Social Security expect all payments to be delivered by late May 2009. To assist Social Security in issuing these payments as quickly as possible, beneficiaries should not contact Social Security unless they do not receive their payment by June 4th.

-A new law may make it easier for some Americans to allow their retirement funds to recoup losses. That’s because mandatory withdrawals from certain retirement accounts have been waived for tax year 2009. Usually, anyone age 70 1/2 or older is required to withdraw funds from their retirement plans each year, even if the money isn’t needed. These plans include 401(k)s, 403(b)s, some 457(b)s as well as IRAs and IRA-based plans such as Simple IRAs and SEPs.
However, The Worker, Retiree and Employer Recovery Act of 2008 waives the requirement to withdraw funds in 2009. To learn more, visit www.irs.gov/pub/irs-drop/n-09-09.pdf.

-For people who want to save, Social Security offers online planning tools such as the Retirement Estimator. The Estimator allows people to try out different retirement scenarios. Just plug in some quick information and you’ll get estimates of your future benefits based on your personal earnings record. Try it out at www.socialsecurity.gov/estimator.

Facing Divorce? Be Sure to Protect Your Finances

In The Observer’s January 25, 2009 edition, an article entitled “Men become richer after divorce,” written by Amelia Hill, a social affairs correspondent, exposed truths regarding the financial well-being of divorced spouses who have children. In a study conducted by Stephen Jenkins, director of the Institute for Social and Economic Research and chair of the Council of the International Association for Research on Income and Wealth, findings reveal a father’s income rose by one third after divorce, and a woman’s income fell by more than one fifth after divorce regardless of whether the female is a mother. In concordance with the findings, Ruth Smallacombe, a family consultant at Resolution and Family Law in Partnership (Flip) stated, “The general belief that men get fleeced by their divorces while women get richer and live off the proceeds has long been due for exposure as a pernicious myth.” While 27% of separated women are impoverished, less than 9% of separated men face this challenge. Women need to be prepared for the obstacles they may face after divorce. Remember, marriage is a shared partnership. To learn more about how to ensure that you receive your share of the marital property, read WISER’s newly published report entitled, “Divorce and Retirement: Take Control of Retirement Benefits.”

New WISER Release: Divorce and Retirement: Take Control of Retirement Benefits

The Women's Institute for a Secure Retirement (WISER) today released Divorce and Retirement: How to Take Control of Retirement Benefits, a short, commonsense guide on a complicated topic: splitting the financial assets -- all of them -- during a divorce. For hundreds of thousands of couples, this Valentine's Day is only another reminder of the fraught financial reality that divorce presents.

"Divorce is complicated enough without having to worry about retirement benefits," says Cindy Hounsell, President of the Women's Institute for a Secure Retirement. "Our goal is to arm women against their biggest enemy, and it's not the husband -- it's a lack of information."
Written by WISER staff, including D.C.-based divorce attorney and expert Anne E. Moss, Divorce and Retirement claims that what you don't know -- and don't ask about -- can and will hurt you in a divorce. WISER urges readers to get as much information as possible prior to the divorce because "it's nearly impossible to go back to court and ask about a share of your ex-husband's benefit that you learn about after the fact."
The booklet includes Moss's "10 Ways to Avoid Losing the Pension During a Divorce," -- a harsh wakeup call to anyone who currently trusts her lawyer completely. As Moss says, "Ask your lawyer these questions!"

Hounsell agrees. "Knowing what to ask your lawyer can save you from additional heartache during a divorce," she says. "Trust no one -- and never assume that your attorney is an expert on the many federal and state laws in place for splitting retirement benefits."
Because pension and retirement benefits are not automatically split in a divorce, they are often overlooked, and women especially can end up losing big. Divorce and Retirement reiterates the importance of these benefits and breaks down the legal jargon that usually accompanies information on marital property, negotiating an agreement, and getting a qualified domestic relations order (QDRO). WISER also points readers to additional resources, such as AoA-funded Pension Rights Projects across the country, and fact sheets that go into further detail.
"This booklet is not about getting more than your share, or getting back at your former spouse," says Hounsell. "It's about money -- your money -- and how to make sure an innocent oversight (or not-so-innocent) doesn't prevent you from receiving extra help when you'll probably need it most -- in retirement."

Divorce and Retirement is available for free online at www.wiserwomen.org, or in hard copy for $4. Contact WISER at info@wiserwomen.org or call 202-393-5452 for more information.

Government Gives Retirement Funds Room to Recover

A new law may make it easier for some Americans to allow their retirement funds to recoup losses. That’s because mandatory withdrawals from certain retirement accounts have been waived for tax year 2009.

Usually, anyone age 70 1/2 or older is required to withdraw funds from their retirement plans each year, even if the money isn’t needed. These plans include 401(k)s, 403(b)s, some 457(b)s as well as IRAs and IRA-based plans such as Simple IRAs and SEPs. However, The Worker, Retiree and Employer Recovery Act of 2008 waives the requirement to withdraw funds in 2009. To learn more, visit www.irs.gov/pub/irs-drop/n-09-09.pdf.

[Government Gives Retirement Funds Room to Recover] IRS.gov

Do You Qualify for the EITC?

Do you:

1. Possess a valid Social Security number.
2. Meet certain residency and filing criteria, including following guidelines for a qualifying child.
3. Have an investment income that's no more thatn $2,950.
4. Have a total earned income of at least $1 and and an earned income and adjusted gross income (AGI) that's less than:

• $12,880 with no qualifying child ($15,880 if married, filing jointly)
• $33,995 with one qualifying child ($36,995 if married, filing jointly)
• $38,646 with more than one qualifying child ($41,646 if married, filing jointly)

If you meet the criteria above, you may be eligible for the Earned Income Tax Credit (EITC). The EITC is a refundable credit for low and moderate-income taxpayers. If you qualify, you could pay less federal income tax, pay no tax or receive a refund. To find out if you're eligible for an EITC this year, visit the IRS website and use their eligibility tool. If you know you're eligible, find out how much your EITC will be for 2008.

Legislative Update: Paycheck Fairness Act

With the Lilly Ledbetter Fair Pay Act passed, the pay equity community turns its attentions to the Paycheck Fairness Act. This legislation was introduced with the Lilly Ledbetter Fair Pay Act and was approved by the House, but has yet to reach the Senate.

The Paycheck Fairness Act would strengthen the Equal Pay Act (EPA) and allow it to fulfill its promise that women would receive equal pay for equal work, a promise that has remained unfulfilled now for forty five years. The EPA narrowed the wage gap, which previously had women earning 59 cents to a man's dollar, but so far it still has not been able to close it. Women now make 78 cents to a mans dollar, an negligible increase from 2006 when women made 77 cents. The Paycheck Fairness Act would prohibit employers from retaliating against workers who share salary information. This information is often key to uncovering instances of pay discrimination. The bill would also ensure that if there are pay-disparities, they are based on legitimate work-related reasons rather than gender. Essentially, it would close the loopholes that riddled the EPA and create systems and tools that would offer women legal protection from pay discrimination.

We will continue providing you with updates on the Paycheck Fairness Act. For more information, check out these resources:

• How the Paycheck Fairness Act Will Strengthen the Equal Pay Act from the National Women's Law Center
• The Paycheck Fairness Act, H.R. 1338, is Essential to Combating Pay Discrimination Against Women in the Workplace from the National Partnership for Women & Families

Savvy Saver: Savings Tips and Tricks

America Saves week is just around the corner, making it a perfect time to talk about how to save. Money may be tight these days, but there are tips and tricks that can help you continue to contribute to your savings plan. Whether your putting away money for retirement, creating an emergency fund, or just trying to create a tighter day to day budget, these resources can help you work towards your savings goals.

Learn about the Savers's Tax Credit: The Saver's Tax Credit is a non-refundable tax credit for contributions to qualified retirement plans such as 401(k)s, IRAs and others. This credit is for low and middle income taxpayers and provides a credit between 10% and 50% of your retirement plan contribution each year, up to $2,000.00. Think you might qualify? Find out more by dowloading WISER's new fact sheet "The Saver's Tax Credit."

Consider a $50 a month – or more – automatic deduction from your paycheck or checking account to invest in a mutual fund or to buy U.S. Savings Bonds: The sooner you start the better! Investing early pays off because the interest compounds for more years.

Find out if you qualify for an Earned Income Tax Credit (EITC): Locate the Volunteer Income Tax Assistance office near you for free in-person tax help by contacting the IRS at: 800-829-1040 or visiting www.irs.gov.

Young Women and Social Security

Social Security has a present this year for young workers. If you're between the ages of 25 and 35, you will receive a new insert in your annual Social Security statement. "What Young Workers Should Know About Social Security and Savings" provides valuable information on how Social Security works with tips and resources on how to save. It also answers the age old question "Will Social Security still be around when I retire?" If you can't wait for your annual statement, download the insert here.

Still looking for more resources on Social Security? Check out the Social Security section of the WISER website for more information.

State Healthcare Coverage May Aid in Creating a National Plan

A feeling of excitement was felt on Capitol Hill in one of the first hearings, conducted after the inauguration of President Barack Obama. On Thursday January 22, 2009, the Senate’s Health, Education, Labor, and Pensions committee held a hearing to examine measures states are enacting to keep their citizens healthy.

According to Senator Edward M. Kennedy of Massachusetts, the chairman of the committee, 38% of deaths related to chronic illness among Americans arise from alcohol use, smoking, physical inactivity and poor diet. In addition, 75% of health care costs associated with chronic disease are preventable. State Senator of Iowa, Jack Hatch, stressed the importance of preventative healthcare measures. He mentioned that Iowa should lead prevention and wellness initiatives by enabling doctors to use efficient practices and administer proper protocols necessary to treat chronic illnesses. Health care costs are continuing to rise making it necessary for people to receive proper health education, so they can make better lifestyle choices to improve health and contain costs. The state of Iowa has enacted preventative healthcare measures as a means of reform. Some include: 1. By 2011, the state is expected to provide healthcare coverage for all eligible children 2. Iowa has strengthened its public health and prevention programs by launching the healthy communities initiative, enabling small businesses to receive a qualified wellness tax credit.

Mr. Emmet spoke about our country’s failure to treat mental illness. He revealed mental illness is a major cause of disability, yet many insurance services do not provide coverage for mental health visits.

Dr. Dobson stressed the need for community healthcare services. He revealed quality of healthcare can be enhanced and the cost of healthcare can be reduced by providing people with primary care, creating local networks to gather resources and providing state funding for healthcare related programs. State healthcare systems need to be sustained in order to enable one to have access to care and be treated efficiently.

Dr. Bigby spoke about the importance of prevention. She mentioned the 2006 Massachusetts health care reform bill designed to provide the citizens of the commonwealth with universal coverage. 97.4% of Massachusetts residents contain healthcare coverage, 99% of kids contain coverage and 90% of residents have regular healthcare providers and thus receive preventative care. In addition, Dr. Bigby spoke about “Mass in Motion,” a program designed to promote healthy eating and exercise through grants to cities and towns in hopes of making wellness a priority. She also addressed the need to remedy the racial and ethic disparity prevalent in who receives healthcare coverage.

The experts at this hearing were in agreement that access to and quality of healthcare needs to be augmented. In order for people to live healthier lives, they say diet and exercise programs, as well as preventative and routine healthcare services need to be provided to the people of our nation.