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American Morning
Minding Your Business: Time to Unretire?
Aired December 11, 2002 - 08:47 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANDY SERWER, "FORTUNE" MAGAZINE: Unretirement, it is the big new trend. I don't know about you, Bill, thought I was going to leave this job, hit the beach, go to the Final Four, travel with my kids, but a lot of people, millions and millions of Americans are finding they are not able to do that. Two very obvious reason -- one, plunging stock portfolios, and two, soaring health care costs. Also, the number of workers over 60 years old is really soaring. That is up 14 percent. Number of workers over 60 is up 14 percent and the number of workers 18 to 35 is down. Also, here is an interesting one, in 1998, two-thirds of large companies had health care coverage. Today, two-thirds of large companies don't.
BILL HEMMER, CNN ANCHOR: Wow. That could critical.
If you look at the way the stock market has gone, a lot of people were banking on the retirement money and their 401k and watched it fizzle, along with so many others.
What do you do if you're trying to make a decision as to whether or not you fit this category?
SERWER: Right, well, it's interesting. It seems like a no- brainer, you need more money, you go back to work. It's not that simple, Bill, because there are a lot of tax implications.
Let's look at some of these reasons. How much money do you need? If you say you need $20,000 more of income, you really have to factor in all of the costs of going back to work, commuting costs, lunch money. It might put you in a higher tax bracket. So that is number one. Will you get hit with a Social Security penalty is another one as well. They just got rid of that for workers in their later 60s. Still exists, though, in your younger 60s. And then, also, are you almost age 70 1/1? That, of course, is when you have to take those distributions from your 401k at work. If you go back to your old job, you don't have to take those distributions, but you do from an independent IRA.
Talk to the human resources people if you're at a big company, or if you don't have someone like that, talk to your accountant. Very important to get all that stuff straight.
HEMMER: As you well know, get a plan together, too.
SERWER: Oh, yes, start young, start young.
HEMMER: Thank you, Andy. See you next hour.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
Aired December 11, 2002 - 08:47 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANDY SERWER, "FORTUNE" MAGAZINE: Unretirement, it is the big new trend. I don't know about you, Bill, thought I was going to leave this job, hit the beach, go to the Final Four, travel with my kids, but a lot of people, millions and millions of Americans are finding they are not able to do that. Two very obvious reason -- one, plunging stock portfolios, and two, soaring health care costs. Also, the number of workers over 60 years old is really soaring. That is up 14 percent. Number of workers over 60 is up 14 percent and the number of workers 18 to 35 is down. Also, here is an interesting one, in 1998, two-thirds of large companies had health care coverage. Today, two-thirds of large companies don't.
BILL HEMMER, CNN ANCHOR: Wow. That could critical.
If you look at the way the stock market has gone, a lot of people were banking on the retirement money and their 401k and watched it fizzle, along with so many others.
What do you do if you're trying to make a decision as to whether or not you fit this category?
SERWER: Right, well, it's interesting. It seems like a no- brainer, you need more money, you go back to work. It's not that simple, Bill, because there are a lot of tax implications.
Let's look at some of these reasons. How much money do you need? If you say you need $20,000 more of income, you really have to factor in all of the costs of going back to work, commuting costs, lunch money. It might put you in a higher tax bracket. So that is number one. Will you get hit with a Social Security penalty is another one as well. They just got rid of that for workers in their later 60s. Still exists, though, in your younger 60s. And then, also, are you almost age 70 1/1? That, of course, is when you have to take those distributions from your 401k at work. If you go back to your old job, you don't have to take those distributions, but you do from an independent IRA.
Talk to the human resources people if you're at a big company, or if you don't have someone like that, talk to your accountant. Very important to get all that stuff straight.
HEMMER: As you well know, get a plan together, too.
SERWER: Oh, yes, start young, start young.
HEMMER: Thank you, Andy. See you next hour.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
