To Age Well, Change How You Feel About Aging

Negative stereotypes about getting older can become a self-fulfilling prophecy. How to improve your mind-set-and well-being.

Scientists are discovering something very peculiar about aging: How we feel about getting old matters. A lot.

In test after test, researchers are finding that if we think about getting older in terms of decline or disability, our health likely will suffer. If, on the other hand, we see aging in terms of opportunity and growth, our bodies respond in kind.

That research holds out the possibility for much healthier aging. But it also points to a very big obstacle: Negative stereotypes about aging are pervasive in America. Even many older adults embrace the idea that getting old is a bad thing-which means they’re doing potentially serious harm to their health without realizing it.

Can we change the way we feel about aging-and improve our prospects for healthier senior years? A growing body of research offers hope.

Psychologists and neuroscientists are identifying strategies that individuals can use to improve their mind-sets about aging, with benefits for their health and well-being. In a recent study, for example, researchers at institutions including the Yale School of Public Health found that older individuals who were subliminally exposed to positive messages about aging showed long-term improvements in self-image, strength and balance. Other recent studies have shown that it’s possible to achieve similar results with tactics that psychologists, cognitive therapists and educators use to treat depression, combat race and gender bias, and break people of harmful habits, such as smoking.

Negative stereotypes about aging “are a public-health issue,” says Becca Levy, an associate professor of epidemiology and psychology at the Yale School of Public Health and lead author of the Yale study. “What people aren’t aware of is that they have the ability to overcome and resist negative stereotypes” and “compensate for the ill effects of automatic ageism.”

With that in mind, here are four ways people can better protect themselves from the potentially harmful effects of stereotypes about aging.

1. Understand the myths vs. the facts
Experts say the first step in overcoming negative stereotypes about aging is simply to understand how they work and recognize just how debilitating the consequences can be.

Stereotypes in general-negative and positive-are entrenched in part because they help us take cognitive shortcuts. By offering a way to “automatically categorize people into social groups,” they allow us to “free up mental energy to” live our daily lives, says Michael North, an assistant professor of management and organizations at New York University’s Stern School of Business. “If we were to try to make sense of everything and everybody we encounter, we wouldn’t have enough attention left over to be functional human beings.”

Some stereotypes about older adults are positive: the kind grandparent; the elder statesman; the spry matriarch. But “in most Western societies, the perception of age and aging is predominantly negative,” says Dana Kotter-Gruehn, a visiting assistant professor of psychology and neuroscience at Duke University in Durham, N.C.

Scientists aren’t sure exactly how holding negative stereotypes affects health, but they say it’s clear that there is a connection, and it isn’t simply correlation. In test after test, negative stereotypes have been shown to lead to poor health results. Over the past two decades, dozens of studies from psychologists, medical doctors and neuroscientists have shown that older people with more negative views of aging fare more poorly on health than those with less-pessimistic attitudes.

Even when study participants have similar health, education levels and socioeconomic status, those with more negative outlooks about aging show greater declines in a variety of areas over time. They have shakier handwriting, poorer memories, higher rates of cardiac disease and lower odds of recovering from severe disability, according to studies by Prof. Levy. They are less likely to eat a balanced diet, exercise and follow instructions for taking prescription medications as they age. They even die younger-the median difference in survival rates is 7.5 years.

None of which is to say that some negative views of aging aren’t true. We certainly can experience declines in physical strength as we age, and our senses tend to weaken, too. But it’s important to realize that many other things that are broadly accepted just aren’t true.

For example, far from feeling more depressed or lonely than younger people, older people tend to express greater satisfaction with their relationships. Some studies have found that, at work, older workers make fewer errors than their younger counterparts. And research suggests that memory can be enhanced in old age.

The lesson: While most people assume aging can be explained entirely “as a physiological process,” Prof. Levy says, “beliefs about aging, which are taken from the culture, have an impact.”

Education, then, is a start: getting beyond myths about aging and, equally important, understanding (as a growing body of research indicates) that our moods, relationships and overall sense of well-being actually can improve with age, as can knowledge and certain types of intelligence.

A forthcoming study demonstrates that education alone can have a big impact on how we look at aging. Psychologists at Colorado State University conducted an experiment aimed at improving attitudes about aging among 62 sedentary adults, ages 53 and older. Over the course of a month, the participants attended two-hour weekly classes aimed at debunking age stereotypes and received instruction in ways to set achievable fitness goals.

The findings: “People’s negative views on aging became much more positive,” says Manfred Diehl, a co-author and professor of human development and family studies at Colorado State. The participants also increased their levels of physical activity in the two months over which they were monitored afterward.

2. Recognize stereotypes in everyday life
Once you’re aware of the power of stereotypes, it’s important to be aware of just how pervasive they are. Again, that isn’t to say that none of the messages are true. But we are bombarded by one view of aging without being aware of it, so paying attention is an important way to lessen the impact.

Studies show that negative stereotypes about aging-for example, that older people inevitably grow less productive and more depressed-are as pervasive as they are inaccurate. On television, older adults are often absent or “provide comic relief by displaying physical or mental incompetence,” Prof. Levy wrote in a 2005 study of 76 television watchers that showed, among other things, that those who watched more television had more negative “images of aging” than less-frequent viewers.

More recently, she and other researchers examined 84 Facebook groups that included descriptions of people ages 60 and older. On all but one, they found that negative stereotypes predominated, with 27% of the site descriptions “infantilizing” older adults and 37% advocating “banning [older adults] from public activities,” such as shopping.

“Because there is no PC backlash against it,” ageism is often “overlooked as a form of prejudice,” says Prof. North in New York.

Prof. Levy recommends keeping a diary. In the 2005 study of television viewers, researchers asked about half of the 76 participants to evaluate in writing the physical and cognitive health of older television characters. The other half were asked to simply record the names of the shows they watched. After a week, the scientists surveyed both groups. Those who wrote the detailed evaluations were significantly more aware than the other group was of how elders are presented, the study says.

It’s also important to acknowledge our own prejudices, says Ashton Applewhite, author of the blogs “This Chair Rocks” and “Yo, Is This Ageist?”

Before you conclude you don’t have any, take the Implicit Association Test. Harvard University publishes an online version, which psychologists use to measure bias by gauging how quickly test-takers associate pleasant versus unpleasant words with young and old faces.

The next step is to become more aware of your own thoughts about older people and aging. One thing to guard against: a tendency to “blame things automatically and reflexively on age,” says Ms. Applewhite.

Many older adults automatically attribute physical and health problems to aging, rather than to specific causes that might be treatable. For example, Type 2 diabetes is not caused by age but by a poor diet, lack of exercise and other factors, many of which can be addressed. Others chalk up occasional memory lapses to “senior moments,” rather than to disorganization or busyness; in contrast, someone in their 20s who constantly loses his or her keys would never attribute that to age.

Blaming everything on age can “reinforce negative stereotypes in ourselves” that equate aging with decline, says Mary Lee Hummert, a professor at the Gerontology Center at the University of Kansas in Lawrence, Kan.

A growing number of organizations are pointing out prejudices and stereotypes and helping people overcome them., a nonprofit based in Ithaca, N.Y., sponsors initiatives including “Age of Disruption Tour,” a show currently traveling the country that mixes music with lectures about overcoming aging stereotypes.

3. Substitute positive for negative stereotypes
But being aware of negative stereotypes isn’t enough. Research shows that negative stereotypes about aging have a much stronger influence over older adults than positive ones-so it’s important to learn to emphasize the good side of aging.

In recent years, researchers have begun identifying techniques people can use to interrupt negative thoughts about stereotyped groups as they arise-and substitute more positive thoughts.

In a study published in 2012, researchers at the University of Wisconsin used a combination of techniques to see whether they could reduce the biases of 91 undergraduates.

After taking the Implicit Association Test, the 91 participants-90% of whom demonstrated more negative associations with black than with white people-were divided into two groups. One group was enrolled in a 45-minute training session, while the other wasn’t given any specific instructions.

Those enrolled in the training session were taught about bias and its consequences and given several techniques designed to substitute positive for negative stereotypes and images. For example, the scientists asked participants to look for examples of people in stereotyped groups who don’t fit the stereotypes. Participants were also instructed to “think about what it would be like” to be a member of a stereotyped group and to try to have contact with and “obtain specific information” about the individuals in those groups whom they encountered.

“We explained that if they were motivated to eliminate bias, they could learn and then practice the various bias reduction techniques,” says lead author and psychology professor Patricia Devine.

Eight weeks later, all 91 took the test again. Those assigned to the training program showed a larger increase in concern about discrimination and also dramatically less bias than those without it, says Prof. Devine, who believes the same results would hold for age stereotypes. “It is important to harness the power of the conscious mind to overcome bias of all sorts,” she adds.

4. Accept the aging process
All that said, it’s important not to go overboard and expect an entirely positive experience of aging. The key is to hold both positive and negative in balance and really understand and own the aging process.

On average, individuals ages 40 and older report feeling 20% younger than their actual ages-a tendency that can serve a useful psychological purpose.

“By distancing yourself from your age, you also distance yourself from negative age stereotypes,” says David Weiss, assistant professor of sociomedical sciences at Columbia University’s Mailman School of Public Health in New York.

But age denial can also leave us vulnerable to the harmful impact of negative age stereotypes down the road-for example, if we suffer a disability or are confronted by evidence that others view us as old, experts say.

Moreover, “denying one’s age may be psychologically harmful in that it disassociates us from various important developmental tasks that should take place in later life,” says Prof. Weiss.

The solution may sound trite, but experts say it’s crucial: “To embrace aging-both the good and bad,” says geriatrician Bill Thomas, co-founder of

Dr. Thomas says it’s important to look not just at the negative changes that take place as we age but also at the positives, such as the improvements scientific studies have shown over time in our interpersonal skills, relationships, expertise and knowledge. While it’s important to accept the negatives-you may, for example, no longer be the runner or tennis player you once were-that doesn’t mean you cannot adapt your game or find other outlets with similar payoffs.

Recent studies point to other techniques we can employ to become more satisfied-or less dissatisfied-with our age.

Research by Prof. Weiss, for example, concludes that identifying with one’s generation, such as baby boomers’ being proud of the differences they made in the culture, is a way to “embrace a more positive conception of older age” and link people “to a positive social identity or legacy that will endure beyond their own lifetime.” In the research, Prof. Weiss and a co-author found that older people who thought about their generations reported better well-being.

Yet another solution: exercise. While the health benefits of physical activity are widely known, a 2012 study shows that exercise can also leave us feeling better about the aging process.

Researchers at the Berlin medical center Charité Campus Benjamin Franklin enrolled 247 women, ages 70 to 93, and randomly divided them into three groups. During three 90-minute sessions each week, one group attended a computer class, while another took an exercise program. The third group was told to stick to their normal routines.

After six months, the exercise group reported the highest level of satisfaction with aging, says Verena Klusmann, lead author and psychologist at the Universities of Konstanz and Bremen. (All three groups started at similar satisfaction levels.)

“These women were more physically fit, more alert and had better executive functioning. The positive experience of exercising affected their well-being and improved attitudes about aging,” she says.

By ANNE TERGESEN, The Wall Street Journal

How retirees can make the most of their home equity

As more Americans approach retirement age with meager savings, many might consider tapping their home equity. After all, on average, Americans have more net worth in their homes than in financial assets, according to a recent report from the Boston College Center for Retirement Research (CRR). But are recent and near retirees taking advantage of this equity to help fund their retirement?

Not really, according to “How Americans Manage Their Finances,” a recent report from the University of Southern California (USC) in collaboration with the Society of Actuaries. The USC report found that by late 2015, fewer than 1 percent of Americans age 62 and older had taken out a reverse mortgage — a financial tool that lets you borrow against your home equity and not repay the loan until you sell the house or die.

Reverse mortgages have been receiving a lot of fanfare lately as aging boomers look for ways to finance their retirement and lenders use persuasive ads to pitch their products. Reverse mortgages also received a boost recently with lower-cost loans being introduced as a result of new government regulations and as thoughtful analysts such as Wade Pfau have discussed how they can be a viable part of a retirement income portfolio.

The USC report shows that far more older Americans are using their home equity in traditional and conventional ways. Most older Americans own their home — 74 percent of those 60 to 69 and 87 percent of those 70 and older. Of these homeowners, 34 percent in the 60-to-69 group and 56 percent of the 70 and older group owned their homes mortgage-free.

Of older Americans with mortgages, most plan to pay these loans off, according to the current payment schedule (57 percent of people 60 to 69, and 70 percent of those 70 and over). Most haven’t refinanced their mortgages in the past three years and don’t plan to refinance, saying they’re close to paying off their mortgage, their current interest rate is already quite low or there’s not much potential to save money.

Owning your home mortgage-free gives you control over your living expenses. By paying off your mortgage, you’ll live rent-free, with no landlord raising your rent or asking you to move. Retirees who’ve paid off their mortgage have substantially lower living expenses compared to both renters and owners with a mortgage, allowing their Social Security and retirement savings to go much farther each month.

Paying off your mortgage and not taking a reverse mortgage also allows you to hold your home equity as a reserve you can tap later if you really need the money to pay for medical or long-term care expenses. At that time, you’ll have the flexibility to determine the best way to tap your home equity, through a loan, reverse mortgage or simply selling the house and cashing in the equity.

If you don’t need to tap into your home equity, it can serve as an inheritance to leave your children or charities.

Indeed, the USC study confirmed that many Americans are already using these strategies. When older survey respondents were asked why they hadn’t taken out a reverse mortgage, the three most prevalent answers were:
They didn’t need a reverse mortgage (60 percent)
They wanted to preserve home equity for heirs (31 percent)
They wanted to preserve home equity for an emergency fund (14 percent)

If you’re considering a reverse mortgage, it’s important to do your homework before going through with it. For instance, using a reverse mortgage to pay for long-term care expenses has one big problem: Most lenders require at least one owner to be living in the home. If all owners move out of the house and into assisted living, the lender can terminate the mortgage.

The CRR report discusses the pros and cons of various ways to tap your home equity, including details on reverse mortgages. It’s a good place to start doing your research into the most appropriate way to tap home equity given your unique goals and circumstances.

Steve Vernon, Moneywatch

New Math on Reverse Mortgages

Advisers now are promoting them as a valuable tool for retirement planning, thanks to recent safeguards

The reverse mortgage has won some new respect.

A decade ago, most financial advisers would roll their eyes at the mention of reverse mortgages, loans that give homeowners an advance on their home equity and allow them to delay repayment until the home is sold. Such products, these advisers used to say, weren’t for their clients, but rather for those who didn’t prepare financially for retirement.

New safeguards in recent years, however, have led many advisers and researchers to change their minds about reverse mortgages. Indeed, many now are exploring when and how to use them in financial plans.

One important change, the Reverse Mortgage Stabilization Act of 2013, prevents homeowners in most cases from taking all their equity at once-roughly 40% of the total amount that can be borrowed is unavailable until a year after the initial loan. Other recently enacted regulations require homeowners to demonstrate they are able and willing to pay their property taxes and home insurance. And there are new protections for the nonborrowing spouse.

Recent policy changes “should make the product safer for seniors in the future,” says Stephanie Moulton, an associate professor at Ohio State University and co-author of a 2015 paper on reverse mortgages published in the Journal of Urban Economics. Prof. Moulton estimates that such changes as limiting how much equity borrowers can extract upfront could cut the default rate on reverse mortgages in half. (In 2014, nearly 12% of reverse-mortgage borrowers in the federally insured Home Equity Conversion Mortgage program were in default on their property taxes or homeowners insurance.)

“Over time, these changes may encourage larger banks to re-enter the market, further increasing the credibility of the product and potentially lowering costs,” Prof. Moulton says.

Of course, there are still risks, including spending the proceeds too quickly and suffering losses if the proceeds are invested, as pointed out in a 2015 paper written by Wade Pfau, a professor at the American College of Financial Services in Bryn Mawr, Pa., that favored the use of reverse mortgages in a retirement-income plan under the right circumstances.

While acknowledging the risks, Prof. Moulton says that “one of the advantages of the federally insured reverse mortgage, the HECM, is that the government assumes some of the risk for the borrower.” For example, she notes that HECM borrowers can never end up on the hook for negative equity. If the balance on the reverse mortgage ever grows to exceed the value of the home, the federal insurance covers the difference.

Here’s a look at some of the reverse-mortgage strategies financial planners suggest:

Taking a lump sum
Borrowing enough of the equity in a house in a lump sum to pay off an existing mortgage is one of the most frequent uses of a reverse mortgage, says Prof. Moulton. More than 60% of reverse-mortgage borrowers have used the proceeds for this purpose, according to her research. “This actually may be a pretty smart strategy,” she says.

Prof. Moulton cites a recent report by Harvard University’s Joint Center for Housing Studies that found that nearly 40% of seniors age 65 and older carry a mortgage today, a rate that has more than doubled since 1992. “Using a reverse mortgage to pay off a forward mortgage frees up monthly cash flow to a household,” she says. “Essentially it has the same effect on a household budget as receiving a monthly annuity payment.”

But lump-sum borrowing can go wrong. Harold Evensky, chairman of Evensky & Katz/Foldes Financial, a wealth-management firm based in Lubbock, Texas, generally advises against using a lump sum as leverage to increase debt-as a down payment on a second home or vacation home, for instance. “There may be circumstances that justify the strategy, but it’s not something that should be considered without carefully considering the potential risk,” he says. “The risk is overleveraging,” he says-taking on more debt than you can afford to pay off.

And even if that isn’t the case-if the homeowner spends the borrowed money without incurring additional debt, say on a vacation or a car-spending the equity in a home this way deprives the homeowner of a valuable financial cushion, he says.

Opening a line of credit
Increasingly, advisers are suggesting that homeowners establish a line of credit through the HECM program whether they need the money immediately or not, because it can be used in several ways, as the need arises, to protect savings or even increase income in retirement.

A line of credit makes more sense than borrowing a lump sum and keeping it in reserve, says John Salter, an associate professor at Texas Tech University who has co-written papers with Mr. Evensky on reverse mortgages. That’s because, due to the intricacies of reverse-mortgage terms, the unused portion of a line of credit grows over the years, giving the homeowner access to more cash.

Shelley Giordano, chairwoman of the Funding Longevity Task Force, a Washington, D.C.-based industry group that promotes the use of home equity as a tool for retirement income, suggests setting up a reverse-mortgage line of credit as a way of protecting retirement funds from fluctuations in the financial markets.

Here’s the idea: In a bear market, homeowners can borrow funds as needed through the line of credit rather than withdrawing money from their investment portfolios. Withdrawals from a portfolio in down markets lock in losses and leave less money to grow when markets rebound. By borrowing instead, homeowners give the portfolio a better chance to recoup its losses when markets turn around.

Once the portfolio recovers, it can be used to pay off the line of credit, which is then fully available the next time cash is needed in a bear market. Ms. Giordano notes an HECM line of credit “cannot be canceled, frozen or reduced regardless of what the home value does in the future.”

An HECM line of credit also can be used as a source of income for those who want to delay applying for Social Security benefits and so increase their monthly payout when they do start taking benefits, Ms. Giordano says. After you apply for Social Security, you can stop taking money from the line of credit and, if you want, pay the loan back.

Because income from a reverse mortgage isn’t taxed, experts say an HECM line of credit can also be used-in place of taxable withdrawals from retirement accounts-to avoid tax-bracket creep, as well as the higher Medicare Part B and Part D premiums that can result from higher incomes.

Ms. Giordano also suggests using a reverse-mortgage line of credit to pay taxes due on Roth IRA conversions. In the conversion process, distributions from IRAs are taxed as ordinary income, and experts often recommend paying those taxes with funds outside the IRA, because using money from the IRA for that purpose generates even more taxes.

Mr. Evensky says the usefulness of reverse mortgages belies the negative impression some people still have of them.

“I believe most criticisms relate to a myopic view of the product that has not been reviewed for decades,” he says. “Unquestionably there can be misuses of the product. But the problem is the use, not the product.”
ROBERT POWELL, The Wall Street Journal

Seniors who receive federal benefit should consider receiving payments electronically

Keep in mind a disaster can disrupt mail service for days or even weeks. For those who depend on the mail for their Social Security benefits, a difficult situation can become worse if they are evacuated or lose their mail service – as 85,000 check recipients learned after Hurricane Katrina. Switching to electronic payments is one simple, significant way people can protect themselves financially before disaster strikes. It also eliminates the risk of stolen checks.

The U.S. Department of the Treasury recommends two safer ways to get federal benefits:

  • Direct deposit to a checking or savings account is the best option for people with bank accounts. Federal benefit recipients can sign up by calling (800) 333-1795 or at
  • The Direct Express® prepaid debit card is designed as a safe and easy alternative to paper checks for people who don’t have a bank account. Sign up is easy – call toll-free at (877) 212-9991 or sign up online at

Signing up for direct deposit or the Direct Express® card is a simple but important step that can help protect your family’s access to funds in case the unthinkable were to happen. If you or those close to you are still receiving Social Security or other federal benefits by check, please consider switching to one of these safer, easier options today.

With Age Comes a Growing Risk of Malnutrition

Diet, Inactivity and Chronic Ailments Leave a Surprising Number of People Vulnerable

For most older Americans, malnutrition may seem like a remote worry. But evidence is mounting that they should start paying attention-and that a range of age-related factors can interfere with the intake of nutrients necessary to ward off illness, keep the immune system strong, and maintain overall health and well-being.

The biggest culprits include obvious ones such as poor dietary choices and physical inactivity. But chronic ailments such as heart disease and diabetes and the drugs used to treat them can interfere with food intake and nutrient absorption. And loneliness, grief and depression, such as after the breakup of a marriage or death of a spouse, can disrupt healthful eating habits.

“A whole host of medical and social issues or underlying medical conditions can be responsible for poor nutritional status in older adults,” says Donald Hensrud, a nutrition specialist at the Mayo Clinic in Rochester, Minn., and editor of the health system’s Mayo Clinic Diet program. For example, adults living alone may eat the same thing over and over again because it’s easy, or lose interest in cooking and eating for one, so they end up on a “cookies and milk” diet, Dr. Hensrud says.

A study of older adults published last July in Geriatric Nursing found that while those who were depressed, widowed or both had higher intake of some nutrients, the majority of nutrient levels along with caloric intake were below the amounts recommended by national dietary guidelines. The study cited other research showing that, in comparison to peers who were married, widowed individuals are also more likely to consume fewer vegetables and eat foods that aren’t nutritious, and less likely to prepare homemade meals.

Growing Risk
The swell of aging baby boomers, makes it increasingly important for medical professionals to evaluate older patients for nutritional deficiencies and ensure they are consuming a balanced diet, Dr. Hensrud says. Often, malnourishment may be recognized only when older adults are admitted to the hospital, including for elective surgeries.

Malnutrition associated with eight diseases costs the U.S. health-care system $156.7 billion annually, according to a recent study published in the Journal of Parenteral and Enteral Nutrition. The researchers received funding from Abbott Nutrition, which makes nutritional supplements used in hospitals.

Patients with diseases such as diabetes or congestive heart failure may be at risk of malnourishment because of dietary restrictions such as limits on salt, fat, protein or sugar that may lead to inadequate eating. Smokers who suffer from chronic obstructive pulmonary disease, also known as emphysema, are at risk of malnourishment due to poor eating habits, lack of exercise and suppressed appetite, as well as changes in their metabolism, which make it harder for the body to absorb nutrients from food. Heavy drinkers are also at risk because excess alcohol interferes with the digestion and absorption of food.

While unintentional weight loss is often a sign of problems, overweight and even obese adults can be malnourished if they are sedentary and consuming unhealthy food.

The Mayo Clinic recommends a plant-based diet with plenty of fresh fruits and vegetables, whole-grain carbohydrates, healthy fats such as olive oil and canola oil, and leaner types of protein. Most studies show that popping handfuls of dietary supplements is of little use and can even be harmful in large quantities. But in some cases, such as vitamin D, which is essential for strong bones, and Vitamin B12, which is important for the function of the brain and nervous system, it may be advisable to supplement the diet in some way. Because some people over 50 have trouble absorbing the vitamin B12 found naturally in foods, the National Institute on Agingrecommends foods fortified with B12 such as cereal.

Protein consumption, along with regular physical activity, is vital for maintaining muscle mass and strength, “but many older individuals do not consume enough protein to maintain their muscle mass,” says Edward Archer, a researcher at the Nutrition Obesity Research Center at the University of Alabama, Birmingham. That can trigger what he calls “a downward spiral to frailty.”

Bigger Appetite
New evidence shows that older adults need more dietary protein than younger adults to make up for age-related changes in the way the body metabolizes protein. In a Journal of the American Medical Directors Association report in 2013, an international study group recommended average daily intake in the range of 1.0 to 1.2 grams of protein per kilogram of body weight per day (divide your weight in pounds in half, and the result is roughly how many grams of protein you need daily), along with endurance and resistance-type exercises to help those over 65 maintain or regain lean body mass and function. Those with acute or chronic diseases need even more dietary protein, or as much as 1.5 grams per kilogram of body weight, the group said.

Hospitals are increasingly educating their staffers on how to recognize malnutrition in older patients, screening patients within 24 hours of admittance and at regular intervals throughout their hospital stay. They are using new guidelines from the leading nutrition and dietetic societies, which say at least two of six factors must be present to diagnose malnutrition: insufficient food intake, weight loss, fat loss, loss of muscle mass, fluid buildup that can mask weight loss, and diminished functional ability measured by hand-grip strength.

According to the Alliance to Advance Patient Nutrition, a nonprofit group that includes the Society of Hospital Medicine, the Academy of Medical-Surgical Nurses, and the Academy of Nutrition and Dietetics, malnourished patients are up to three times as likely as others to develop an infection at the site of surgery or pneumonia after an operation, and twice as likely to develop bedsores. Close to half of patients who fall in a hospital are malnourished.

LAURA LANDRO, The Wall Street Journal

Are Majority of Reverse Mortgage Borrowers Satisfied?

How do reverse mortgage borrowers feel about their decision after the fact? According to a new study, the majority of them are satisfied.

Researchers at Ohio State conducted an in-depth study that included 1,761 participants. The goal was to interview those who had taken out the home loan and those who had not following the mandatory counseling session.

Following the counseling session, it found that 68% of borrowers went forward with the loan. 6% started the process but aborted it before closing the loan. The average age of participants was 70, with one-third being female. About 17% had earned a four-year college degree.

According to the study, 78% felt “satisfied” or “very satisfied” with their reverse mortgage. Meanwhile, 76% agreed that having a reverse mortgage improved their quality of life.

The average income of those involved in the study was $31,000 per year, or $2,600 per month, with median assets of $2,000. About 45% of the respondents said they had no assets at the time of the counseling session, with the reverse mortgage being a way for them to tap into their home’s wealth.

For most people, 42%, they sought a reverse mortgage to supplement their income, while 39% wanted the loan to pay off their previous mortgage. 24% used the loan to make home improvements, while 19% wanted to use the funds to provide financial assistance for friends and family. Just 16% wanted to use it to delay tapping into otherretirement income, while 14% used the loan to pay for medical costs. Only 6% said they would use the loan for big ticket purchases or vacations. A substantial 85% said their home was in good condition at the time of the loan.

As these numbers reflect, a majority of reverse mortgage borrowers intend to use the proceeds to supplement their income. As real estate wealth grows among retiring homeowners in the US, experts say that there are trillions of dollars in untapped wealth. In modern times, a reverse mortgage is being increasingly relied upon to replace pensions and help supplement retirement income. The results of this in-depth survey shouldn’t be surprising whatsoever. The best news of all was that most people who take out these home loans are satisfied with all is said and done.

Michael Lazar,

The Best Online Tools for Retirement Planning and Living

Apps and Websites Offer Help With Budgeting, Social Security, Lifestyle Planning and Other Essentials

Planning for retirement? Look no further than your tablet or smartphone.

A growing array of apps and websites make it easier to complete many of the most basic-and most important-tasks, from saving money and creating legal documents to figuring out a second career and where to live.

There are tools for people nearing or in retirement, and for people just starting to think about it. There are apps that help couples set up budgets and stick to them, websites that rebalance 401(k) allocations, and calculators that offer a better-than-educated guess as to how long that nest egg is going to have to last.

Some financial programs take care of chores that are crucial for getting ready for retirement but that many financial advisers often don’t have the time or inclination to do for their clients, such as regularly sweeping cash into accounts that earn higher-than-average interest, or tracking monthly spending.

There also are tools for assisting with health care, as well as help with some difficult issues that people often have trouble navigating, such as the legal, health and practical considerations involved in end-of-life planning.

A few caveats: Some of the financial websites require consumers to enter the usernames and passwords of their investment and bank accounts. Look for sites that use TRUSTe, Norton Secured Seal, or SOC 3, which verify that companies have adequate cybersecurity and privacy procedures, says Brian Costello, a vice president of information security at Yodlee Inc., which sells technology that many sites use to import data from users’ accounts.

Be aware, too, that many free programs make money by recommending products.

What follows are free or mostly low-cost programs that can help individuals and families better prepare for and get more enjoyment out of retirement.

What Will You Do in Retirement?
As baby boomers near the end of their careers, more Web services are helping them think about how they want to spend their time in retirement.

Our favorite:, which offers a free series of introspective exercises. The site also provides links to financial planners trained in “life planning,” which focuses on helping clients clarify their goals, values and priorities before planning their finances. (It receives no compensation for the referrals, says George Kinder, founder of the Kinder Institute of Life Planning, which developed the website and trains financial advisers in life planning.)

One exercise asks three questions: What would you do if you had all the time and money in the world? How would you live if you knew you had only five to 10 years left? And what would you most regret if you died tomorrow?

The goal: “To lead people to a deeper and deeper understanding of what’s most important to them,” says Mr. Kinder.

The site pushes users to come up with concrete goals they can achieve within weeks. For example, someone who dreams of moving to Vermont might pledge to research towns and discuss telecommuting with an employer, says Mr. Kinder.

An alternative:, an AARP website that offers free online tutorials on topics including setting goals and career planning. Developed by experts including author and executive coach Richard Leider, the program includes free 90-minute “checkups” for as many as 25 participants in locations nationwide. AARP is developing longer workshops and in 2015 plans to offer one-on-one online sessions with coaches for about $125 an hour.

Longevity Forecasting
People often underestimate how long they are going to live, which can cause them to overestimate how much they can spend each year in retirement. For many, the mistake lies in overlooking advances in health care that improve their odds of living longer than their parents did.

For an estimate that incorporates health, habits, socioeconomic status and family history, there are life-expectancy calculators such as and How Long Will I Live? The latter was developed by professors at the University of Pennsylvania.

Our favorite is from Blue Zones, a company that studies regions with exceptional longevity and advises companies and communities on ways to improve the health of their employees and inhabitants. (Search for “Vitality Compass” in the “Live-Longer” section at In addition to life expectancy, the calculator can forecast healthy-life expectancy, defined as the age someone will reach before being diagnosed with heart disease, diabetes or cancer. As a result, it can provide insight into the number of years a person might pay higher health-care or long-term-careexpenses. It also offers tips for living longer.

Developed with the University of Minnesota School of Public Health, the calculator is powered by an algorithm that takes into account 29 factors that 314 academic studies have linked to life expectancy, says Nick Buettner, Blue Zones’ community and corporate program director.

How Much to Save
Even with a realistic estimate of life expectancy, it’s virtually impossible to figure out how much to save for retirement or how long a nest egg might last without first knowing how much you’re spending and on what.

Several programs, including Mint and Yodlee’s MoneyCenter, can put together a budget for consumers based on their past spending patterns and alert them when they are in danger of exceeding past thresholds.

The services automatically import data from credit cards, loans, and bank, brokerage and 401(k) accounts. If a customer puts all of his or her purchases on credit and debit cards, the services can break down the spending into categories, such as utilities and groceries, and can even track amounts of spending at specific stores or on specific items.

A growing number of these sites also function as retirement calculators. Mint can project people’s retirement income based on what they have saved and what it figures they will save, given their habits. The service is free but earns a referral fee when users buy products and services, such as bank accounts and credit cards, from advertisers. Starting later this year, rival HelloWallet plans to offer the same basic service-and allow users to model what will happen if they work longer or put more into a traditional or Roth 401(k) or individual retirement account or a health-savings account. The service is available free through some employers, or for $100 a year.

Many services also try to help consumers save more money. HelloWallet computes a financial wellness score for each user, offers a comparison with scores of peers, and recommends ways to improve the score.

Retirement Income Planning
When planning retirement, saving money is half the battle. The other half: figuring out how to generate a steady paycheck throughout retirement.

A growing number of online tools can help. They include robust financial-planning software programs available from companies including Fidelity Investments and Morningstar Inc. that recommend what to invest in and withdrawal strategies. (Morningstar’s service, Retirement Manager, is available through some employer-sponsored defined-contribution plans.)

Because each has pros and cons and is programmed with different assumptions, it’s ideal to try more than one, says Anna Rappaport, chairperson of the Society of Actuaries committee on postretirement needs and risks.

Some recommend a specific approach to investing. For example, Fidelity’s Income Strategy Evaluator, available free, often recommends annuities for those unable to cover basic living expenses with guaranteed sources of retirement income, including Social Security and a pension. (Fidelity sells its own annuities, as well as offerings from companies including MetLife Inc. and New York Life Insurance Co.)

Our favorite income-planning tools-ESPlanner from Boston University economist Laurence Kotlikoff, and Retiree Income from Baylor University Prof. William Reichenstein and co-founder Bill Meyer-combine income and tax planning, an area that not all such tools address.

These services aren’t free. Three phone sessions with a Retiree Income adviser cost from $500 to $2,500. (The greater your assets, the higher the fee.) Retiree Income plans to introduce a do-it-yourself version on its website starting at about $20 a month in early 2015. ESPlanner starts at $149 for the first year plus $50-a-year updates. It offers guidance from an adviser on the phone for $150 an hour. For $500, an adviser will run the program.

“Our research has shown that an optimal Social Security strategy, combined with tax-efficient withdrawals, can extend the life of a portfolio by as much as 10 years or longer,” says Prof. Reichenstein. One caveat: The recommendations sometimes call for deferring Social Security to maximize those benefits and reap tax savings.

Social Security Planning
Not everyone depends on Social Security benefits to cover essential living expenses, but no one should pass up the opportunity to maximize those benefits if they can. The tricky part is knowing when is the best time for each individual to start collecting. A growing number of online programs aim to help users peg the optimal claiming strategy.

For couples, the claiming decision can be especially complicated because of the availability of spousal benefits and the need to consider the financial security of the survivor. Because benefits will rise by 6% to 8% for every year you delay claiming between the ages of 62 and 70, those who claim early may reduce the lifetime benefits they (and their surviving spouses) stand to receive by “tens of thousands of dollars,” says Christopher Jones, chief investment officer at Financial Engines Inc., which offers a free calculator.

Our top pick?, which charges from $20 to $250 (depending on the level of advice). This user-friendly site takes into account a wide variety of household configurations as well as the impact that many other sources of retirement income can have on Social Security benefits.

Medical Care
From quick consultations to second opinions, more Web-based companies offer virtual medical visits via text messages, email, phone and video.

Most services, including Teladoc and MDLive, are mainly for routine conditions, such as rashes, sports injuries and the flu. At Doctor on Demand Inc., patients who answer questions about their medical histories are typically connected with a primary-care doctor within two minutes, says Chief Executive Adam Jackson. The site’s 1,400 physicians can write prescriptions. The cost, which some insurers will cover, is $40 per visit.

For more serious conditions, Grand Rounds Inc. offers second opinions. The site has contracts with more than 1,000 specialists affiliated with facilities including Harvard Medical School. Mainly offered by employers, it is free to those who get it as an employee benefit. Otherwise, it costs $7,500 per medical case-and insurance generally doesn’t pick up the tab. That means if a patient contracts with the service in connection with a hip replacement, and gets cancer the next day, he or she would have to pay another $7,500 for help with that condition.

The service is intended “for complex cases where outcomes are going to be dramatically different based on expertise,” says Owen Tripp, chief executive of Grand Rounds. The service can give referrals to local doctors and book appointments. Aside from providing second opinions, the specialists help plan care and answer follow-up questions, he says.


Worried about mom or dad’s spending? New Web tools can give caregivers almost real-time oversight.

One free app, BillGuard, sends a person’s debit- and credit-card charges to a mobile inbox, where that person-or a designated caregiver-can monitor the transactions. There is typically a one-day lag between the transactions and the time when they appear in the inbox.

A caregiver keeping close tabs can use that information to cancel transactions or request refunds, says Yaron Samid, founder and chief executive. BillGuard also sends alerts about purchases from specific merchants that its algorithms and one million users have identified as scams.

For more control, True Link Financial Inc. offers a service with a prepaid debit card for $10 a month through which caregivers can monitor charges and block spending at specific merchants or charities, or on whole categories-sweepstakes, for example.

Estate Planning
A handful of sites offer a blueprint for estate planning, including a list of the documents that are generally needed in addition to a will.

One of the most comprehensive,, explains how to complete documents such as health-care proxies and powers of attorney that appoint people to make medical and financial decisions on behalf of someone who becomes incapacitated. It has links to standard versions of these documents for all 50 states plus the District of Columbia and discusses living wills, do-not-resuscitate orders and some types of trusts. The site also sends emails to urge users to take specific steps, such as uploading or completing documents.

For $75 a year, users receive five gigabytes of storage for documents on the site. Users frequently upload copies of items their beneficiaries will need, including insurance policies, Social Security cards, bank account numbers, online usernames and passwords, and contracts with funeral homes and cemeteries. Some users even include explanations of their wills, says Abby Schneiderman, the site’s co-founder.

The site requires users to name deputies to receive access to the information. It also recommends companies that provide wills and life insurance, although it currently receives no payment from those companies, says Ms. Schneiderman. Similar websites include Principled Heart.

End-of-Life Care
Making decisions in advance about what health care to receive at life’s end can be difficult. But people who don’t address the issue can leave loved ones guessing at critical times.

Moreover, “when these discussions take place in a crisis, conflict can emerge, including sibling rivalry,” says Harriet Warshaw, executive director of the nonprofit Conversation Project, one of a handful of initiatives dedicated to making it easier to talk about the topic.

Co-founded in 2010 by Pulitzer Prize-winning journalist Ellen Goodman, the Conversation Project offers a free “Conversation Starter Kit” that poses questions including: How much information do you want your doctor to share with your family? And are there important milestones you want to reach? There’s also advice on talking with doctors about these issues.

While 90% of Americans say it’s important to discuss end-of-life medical care, only 27% actually have the talk, says Ms. Warshaw. “Nobody wants to have these conversations, which is why people do not have more control over the way they live at the end of their lives. “We want to give people the courage and confidence to broach the subject.”

Sick of earning next to nothing in interest? Once a month, will automatically sweep cash from a checking account at one of five brick-and-mortar banks into one or more FDIC-insured savings accounts at online banks with above-average interest rates. Currently, those banks pay between 0.75% and 1.05%, versus the 0.09% national average for money-market and savings accounts. Max’s annual fee: 0.08% of total assets in the online bank accounts. The brick-and-mortar banks are Bank of America Corp., J.P. Morgan Chase & Co., Citigroup Inc.’s Citibank, Wells Fargo & Co. and First Republic Bank.

Another good way to save more is to pay less in fees. According to Vanguard Group, over a 40-year career, someone who invests 9% a year of a salary that starts at $30,000 into a balanced fund and pays 0.25% a year in fees will save 20% more than a person who pays 1.25% in fees. can help. The free site shows how much in dollars a user is paying in fees each month, and projects the cumulative lifetime cost of those fees. It identifies fees paid to financial advisers, brokerage firms, 401(k) plans, and mutual funds, and suggests similar, but lower-cost, funds.

For 401(k) advice, check out (with three O’s). For $1 to $15 a month,’s algorithm picks what funds to invest in from a customer’s 401(k) plan menu-and makes the trades for them. And every three months, the service rebalances the portfolio to a target mix of stocks and bonds that becomes more conservative over time, says CEO Chris Costello. One caveat: With a recommended 80% allocation to stocks for someone 10 years from retirement, the service is for those comfortable with equities.

Anne Tergesen,  Wall Street Journal

Retirement Gap Hurts Largest Group of Reverse Mortgage Borrowers: Women

The retirement crisis in the United States threatens to leave many unprepared Americans struggling to save enough for their non-working years. But while the need to adequately plan for retirement affects men and women, old and young, the female population stands to face the biggest uphill battle compared to their male counterparts, according to a recent report.

It is well documented that the U.S. faces a retirement savings crisis. The pain is particularly severe for women who, on average, live longer than men and thus require a bigger nest egg of savings to support this longevity, saysDiane Oakley, executive director of the National Institute on Retirement Security (NIRS).

Compare to men, women are 80% more likely to be impoverished at age 65 or older, while women between the ages of 75-79 are three times more likely than males to be living in poverty, according to a NIRS report released this week.

The report, “Shortchanged in Retirement, The Continuing Challenges to Women’s Financial Future,” details the financial security challenges women face and the wide gender gap that hinders their ability to plan for retirement.

“Women are financially disadvantaged because we still earn less than men and we typically take time out of our careers for caregiving-both of which reduce our ability to prepare for retirement,” Oakley said in a written statement on the report’s findings.

Although the median household incomes of Americans age 65 and older has increased over the years, women are earning 26% less than their male counterparts, according to NIRS, which finds the median household income for men age 65 and older was $48,280 in 2013. For women in this age group, the median income was $35, 810.

The NIRS report is based on an analysis of the 2012 Survey of Income and Program Participation (SIPP) data from the U.S. Census Bureau. This SIPP data examines the distinct challenges posed by the current retirement system of Social Security, pensions and savings for working-age women, retirement-aged women and retirement women.

“This new data is troubling-it shows that a woman’s nest egg is substantially smaller than a man’s and that we’re not making real headway toward closing the retirement gender gap,” said Oakley, who co-authored the report. “The fact that women over 65 are 80% more likely than men to fall into poverty in their retirement years is tragic and should be a call to action for policymakers.”

Traditionally, retirement security in the U.S. has been viewed as a three-legged-stool comprising Social Security, a pension and personal savings. With the rising popularity of reverse mortgages in the context of financial planning lately, the strategic use of home equity has been considered by some to transform this historical “stool” into a four-legged chair.

Women represent the largest group of borrowers utilizing a Home Equity Conversion Mortgage (HECM). In Fiscal Year 2015, 39% of HECM borrowers were single females, according to the most recent actuarial report on the Federal Housing Administration’s Mutual Mortgage Insurance Fund. Single males represented only 22% of total HECM borrowers in FY 2015 and multiple borrowers accounted for 39%.

Although the share of single females outnumbered all other HECM borrowers (except for multiple borrowers), this portion of the borrower population is declining while other groups are growing. In FY 2014, 40% of HECM borrowers were single females, whereas single males represented 21%. The share of multiple borrowers largely remained the same over the last fiscal year.

As employer-sponsored defined benefit pensions going the way of the dodo, and with many retirees’ personal savings not up to snuff and finding it difficult to make ends meet with Social Security, this traditional three-legged stool is broken, especially for women.

In 2010, men received $17,856 in median retirement income from a pension, whereas women received $12,000-or 33% less, according to NIRS.

The gender gap is also evident in defined contribution or 401(k)-type retirement accounts. In 2014, the median amount accumulated in these savings was $36,875 for men and $24,446 for women-or 34% less, according to data from investment management company The Vanguard Group cited in the report.

Vanguard also found that women, on average, saved less than men in their Individual Retirement Accounts (IRA), with the average balance for a man equal to $56,429, and the average balance for a woman equal to $26,307.

Because few employers offer workers automatic ways to translate their individual defined contribution (DC) account balances into lifetime incomes like defined benefit (DB) pension-and because women tend to live longer than men-NIRS finds that women would need to stretch their smaller DC accounts over more years in retirement by planning to withdraw fewer dollars each year; otherwise they put themselves at greater risk of outliving their retirement savings.

Women working in health care, education and public administration fields-where DB pension plans are more prevalent-have higher incomes in retirement and lower rates of poverty than in other industries, according to NIRS. This group of women, unfortunately, represents only a fraction of the population and leaves more work to be done.

In addition to spotlighting the gender disparities American women face as they prepare retirement, NIRS proposes several public policy options aimed to help reduce women’s vulnerability to financial hardship as they age.

Such proposals included strengthening Social Security benefits for women age 65 and older; increasing retirement plan coverage through auto-enrollment in IRAs; increased development of state-sponsored savings plans; expanding defined benefit pension plans; and providing spousal protections in defined contribution accounts.

Jason Oliva,

Older Americans Say Social Security Is Giving Them Wrong Information

Confusion over benefit-filing rules follows passage of new law in October

Some older Americans say they are getting wrong information from the Social Security Administration as they face a crucial deadline to take advantage of popular benefit-claiming strategies that are being eliminated.

At stake are tens of thousands of dollars in lifetime retirement benefits for some couples, according to Elaine Floyd, director of retirement and life planning at Horsesmouth LLC of New York, which trains financial advisers in Social Security claiming strategies.

Because the strategies-known as file-and-suspend and a restricted application for spousal benefits-are complicated and became popular only in the wake of a 2000 law, “Social Security workers have always been a little confused about them,” Ms. Floyd says. But when Congress passed a law in October that phases out the use of the two strategies starting in April, “the confusion got worse than ever,” she says.

Under the new law, those already using the combined strategies can continue to do so, while those born after Jan. 1, 1954 are generally out of luck. By and large, the confusion is over people who aren’t currently using the strategies but are entitled to do so if they act fast.


New Social Security Rules to End Key Filing Strategies (Oct. 31, 2015)
Social Security Strategies for Couples: The New Rulebook (Nov. 19, 2015)
Specifically, people who turn 66 by April 29 can still file for Social Security and suspend their benefits to allow a spouse to file a restricted application, as long as they act by that date. Doing so can make sense if your spouse was 62 or older by Jan. 1 of this year because people in that age group will continue to be able to file a restricted application for only a spousal benefit once they turn 66.

With such a coordinated strategy, one spouse can pocket the spousal benefit while both delay claiming their own benefits to take advantage of the delayed retirement credits that increase monthly payments by 6% to 8% for each year in which claiming is deferred between ages 66 and 70.

With the April 29 deadline looming, individuals eligible to take action are calling the Social Security Administration’s 800-number and visiting its 1,230 field offices nationwide to file and then suspend a claim. But some individuals have been mistakenly told they are ineligible-and some people who are at least 62 but not yet 66 have been wrongly told they need to file now to obtain only a spousal benefit-according to more than a dozen interviews with such individuals and professionals who provide Social Security advice.

Jeanne Houser, age 66, and her husband, Donald, 63, visited the Social Security office in Smithfield, N.C., twice in November, seeking to file and suspend her benefit so that Mr. Houser would be able to file a restricted application for spousal benefits when he turns 66. But during both visits, a Social Security agent told the couple that the combined strategy wasn’t available to them.

The Social Security agent “wouldn’t move forward with my application to file-and-suspend,” says Ms. Houser, a retired nurse. “She said there was no point to it because we both have to be 66.”

Barry Dunlap-who is 66 and whose wife, Kathryn Keller, is 64-says he was similarly rebuffed on two visits to the Social Security office in Santa Cruz, Calif. The couple’sfinancial adviser, Renee Snow, encouraged him to persevere. Mr. Dunlap says he filed-and-suspended his benefit on Feb. 16 over the objections of the agent, who “got heated and insisted Kathryn had to be 66″ by the end of April for the move to work.

Ms. Snow says her clients could have lost over $100,000 in lifetime benefits had they been thwarted from pursuing the two strategies.

“There definitely seems to be some kind of glitch” in Social Security’s operations, says Mr. Dunlap, a retired civil engineer. “I was educated about the strategy and I was still turned away the first time, so you can only imagine what happens to people” who aren’t as persistent, he says.

The Social Security Administration says it has made an effort to inform the 32,300 employees who staff its field offices and 800-number, with a mix of written guidance and video training since year-end. On Wednesday, the agency published new explanations of the rule changes on its website. It also issued two “emergency messages” on the new rules this month.

Such emergency messages are the “routine process used to provide employees with immediate instructions until final instructions are incorporated into” electronic operations manuals, the agency said in an emailed response to questions from the Journal. “In the coming weeks, we will be delivering comprehensive training, providing additional instructions and building on the guidance we have already published,” the agency said, adding that it doesn’t “believe there is widespread misinformation being disseminated to the public.”

Still, companies that offer Social Security advice say they are hearing from more couples having problems filing and suspending now to preserve the restricted-application option for a younger spouse.

Robin Brewton, vice president of client services at Social Security Solutions, says the Leawood, Kan., company receives calls from “a couple people a day” experiencing such problems. Lloyd Watnik, a benefits consultant in San Diego who works with clients nationwide, has received 10 such calls in the past two weeks.

Anyone rebuffed by a Social Security agent should ask to speak to a supervisor or technical agent, according to Russell Settle, co-founder of His client, Michael Ross, 63, requested such a meeting in early February after an agent at the Elkton, Md., Social Security office told his wife, Karen Ross, 66, that she couldn’t file-and-suspend unless her husband simultaneously filed a restricted application. In fact, people younger than full retirement age can’t file a restricted application; if they file for benefits, they are deemed to have filed for their earned benefit or a spousal benefit, whichever is greater.

Mr. Ross says the supervisor overruled the agent and allowed his wife to file-and-suspend.

Avram Sacks, a Skokie, Ill. attorney who specializes in Social Security, tells clients who want to suspend their benefits to take two copies of a letter with such a request to their local Social Security office. Once there, he says, ask a clerk to stamp both copies with the date and keep one to prove you filed the request before the deadline. “You can always file the claim even if the clerk says no. They have to accept it,” he adds.

Ms. Floyd recommends filing online to “avoid human contact.”

At her suggestion, Tim Potts, 66, filed for his benefit online on Feb. 12. after his local Social Security office incorrectly told him he couldn’t file-and-suspend because his wife, Lu Conser, won’t be 66 by the April 29 deadline. On Ms. Floyd’s advice, the Carlisle, Penn. resident wrote in the application’s “remarks” section, “I want to suspend benefits to build delayed credits.”

He has yet to receive confirmation that the agency has processed his application.

Anne Tergesen,

Medicare, reverse mortgages and the complexities of retirement planning

There is a critical nexus between financial advising, tax planning and health care planning that is more and more important in today’s world

My column last month about how reverse mortgages may help stave off Medicare surcharges ignited a few sparks and even more questions. One of the most persistent misunderstandings surrounding reverse mortgages is fear. As one adviser put it, how do we “deal with the fear that the reverse mortgage companies are going to take advantage of the homeowner?” This apprehension is understandable given some of the history in this market space.

As a quick refresher, the crux of my January article was to explore how to use reverse mortgages to reduce high-income retirees’ exposure to Medicare surcharges. The surtaxes, officially known as the income-related monthly adjustment amounts (IRMAA), create higher Medicare out-of-pocket costs for some beneficiaries without providing any additional health coverage benefits. The basic strategy is to structure retirement income to maximize cash-flow sources that are excluded from the Medicare’s MAGI calculation.

The lower the MAGI bracket, the lower Medicare Parts B and D surcharges will be without reducing benefits. A reverse mortgage is one of several methods to provide that tax-free liquidity and cash flow to your clients. A reverse mortgage is also known as a home equity conversion mortgage (HECM).


The functionally of and protections built into reverse mortgages changed dramatically when the Department of Housing and Urban Development (HUD) implemented new regulations in 2013. Some of these provisions upgraded consumer protections.

One of the newer requirements is that the prospective borrowers must meet with an independent HECM certified reverse mortgage counselor before closing. The HEMC counselor is trained to help people understand reverse mortgages and the appropriateness of a reverse mortgage to meet their needs. Additionally, they discuss alternatives to a reverse mortgage.

In preparation for the counseling session, the prospective borrower receives detailed instructions from HUD regarding the purpose of that counseling session. Clients also receive The National Council on Aging HUD approved reverse mortgage consumer booklet titled “Use Your Home to Stay at Home.”

The HECM certified reverse mortgage counselor works for a HUD-approved agency that is independent of the loan originator. The session cost ranges from $125 to $250. Some organizations have grants that may enable them to offer the service free of charge.

HECM counseling is not the only improvement added to reverse mortgage regulations. There are better spousal safeguards. Also, HECM limits have changed to increase the certainty that borrowers will have adequate means during the mortgage term to meet their property taxes, insurance and other home maintenance costs.


While this is all well and good, it still begs the question of what is the advisers’ role when considering including a reverse mortgage, or any other strategy to reduce high-income retirees’ exposure to Medicare surcharges. Certainly high-income clients’ circumstances are complex and multifaceted. They are well beyond the scope of an HECM counselor.

“The reverse-mortgage option should be viewed as a method for responsible retirees to create liquidity from an otherwise illiquid asset, which in turn can create new options that potentially support a more efficient retirement income strategy,” Wade Pfau, professor of retirement income at The American College, wrote in a recent Wall Street Journal article.

It is clear that there is a critical nexus between financial advising, tax planning and health care planning that is more and more important in today’s world. This is similarly true with other methods of diminishing income-related Medicare surcharges, such as ROTH conversions as well as certain kinds of life insurance and annuities. Each person’s financial, tax and health care forecast can vary widely well into retirement. There is no simple rule of thumb to rely on.

That is when a team approach with multiple disciplines to tackle the issues surrounding the plan for the right decumulation strategy is the way to go. The various members of the team provide guidance and support as people navigate these options. Advisers who grapple with this area will see improved preservation of their clients’ retirement nest eggs and experience increased customer satisfaction.

Katy Votava,