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Friday 6 April 2012

Weak U.S. jobs figures could hit world equities

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JPM44.34-0.07
MTL8.96-0.10
GRO1.120.07

By Chikako Mogi and David Gaffen
NEW YORK/TOKYO (Reuters) - World stock markets look poised to fall early next week and safe-haven government debt prices could rally after U.S. employment figures fell short of expectations on Friday.
U.S. stock futures fell more than 1 percent and Treasuries prices rallied after U.S. payrolls grew by 120,000 in March, far below the expected gain of 203,000 jobs.
The MSCI All-County World Index has dipped 2.9 percent after hitting an eight-month high on March 27. Concerns about slower growth in the United States and China, along with a revival of worries about the euro-zone debt crisis, have reduced appetite for stocks.
"I think the market will grind higher, but it will be at a much slower pace," said Jack Ablin, chief investment officer at Harris Private Bank. "Earnings and jobs aren't helping."
The focus next week is likely to be on several key economic releases from China and the beginning of U.S. earnings season.
Signals that central bankers are unlikely to inject more stimulus has undermined demand for equities.
The S&P 500's loss for the week of 0.7 percent was its biggest weekly decline of the year as yields on Spain's debt marched higher and its equity market plumbed lows not seen since the height of the euro zone's crisis last year.
Spain's rising bond yields, which have renewed concerns about Europe's debt problems, could temper buying interest in coming weeks. Along with Spain, yields in highly indebted Italy rose on Thursday, boosting investors' safe-haven appetite for U.S. Treasuries and German Bunds, as well as gold.
The euro-zone debt crisis receded from the headlines after heavy doses of stimulus from the European Central Bank late in 2011.
A slew of data due next week from China, the world's second largest economy after the United States, deterred investors in Asia from taking fresh positions at the end of the week. Signs of a sharper-than-expected slowdown could further undermine sentiment.
"The data from China will be the key measuring stick on how confidence will hold up," said Yoon So-jung, an analyst at Shinyoung Securities.
China is set to release first-quarter gross domestic product, inflation figures and trade balance data.
U.S. markets next week will focus on the beginning of earnings season, as bellwethers J.P. Morgan Chase & Co (JPM.N) and Google Inc (GOOG.O) are expected to report results.
U.S. earnings growth is expected to come in at 3.2 percent for the first quarter, but that figure falls to 1.8 percent year-over-year growth when Apple Inc (AAPL.O), the world's biggest company by market value, is excluded.
The weak U.S. payrolls report for March could renew hopes for more stimulus from the Federal Reserve. That could conceivably help stocks and hurt the dollar.
However, this week's release of minutes from the Fed's March meeting suggested less appetite for additional buying of government debt, even as committee members expressed worries about the sluggish pace of U.S. growth.
"The question for the dollar is whether this is as viewed as an outlier in an otherwise improving trend in labor markets or if it's viewed as enough to revive talk of another round of Fed policy easing," said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington D.C.
The euro rose against the dollar to $1.3087 after hitting a three-week low of $1.3035 on Thursday, while the dollar index (.DXY), measured against key currencies, slipped from three-week highs to 79.86.
Trading volumes were light because of the Good Friday holiday and market closings in Europe, and Treasuries rallied sharply, with the benchmark 10-year note up 1-2/32 in price to yield 2.065 percent.
S&P 500 futures fell 16.2 points, or 1.2 percent, to 1374, suggesting a weak open on Monday. Nasdaq 100 futures dropped 1.1 percent, or 31.25 points, to 2722.50 in thin trading. Dow futures dropped 137 points, or 1.1 percent, to 12,841.
Gold ticked higher to $1,637.99 an ounce in thin trade on Friday but ended down 1.8 percent on the week. Bullion hit a near three-month low of $1,611.80 this week.
Oil rose on Thursday after two straight days of losses on firm U.S. data and fears of Iran-related supply disruptions. Brent crude futures climbed 0.89 percent to settle at $123.43 a barrel, and U.S. crude jumped 1.81 percent to settle at $103.31.
(Additional reporting by Dominic Lau in Tokyo and Joonhee Yu in Seoul; Editing by Padraic Cassidy)

Thursday 13 October 2011

Nonito Donaire, Bob Arum and the Top Rank road to stardom

After an attempt to break free from Bob Arum and Top Rank Promotions, Filipino-American star, Nonito Donaire is back with the famed promoter and back on course to become, perhaps, the next big thing.

80-year-old Hall of Fame promoter, Bob Arum has seen and done it all over the course of his six decade involvement in the sport of boxing. Some may argue about whether Arum, overall, has been good or bad for boxing, but nobody can argue with the fact that few people have had as much of an impact on the sport as Arum.

Despite being a contractual wiz and, perhaps, one of the boldest, straight-faced truth manipulators in the long, shady history of professional prize fighting, Arum's greatest strength is matchmaking.

Arum's ability to sniff out quality targets for his fighters is second to none and he has used his talent to help build the careers and reputations of several of the sport's biggest names.

A matchmaking architect with an uncanny ability to target veteran fighters precisely at the moment they begin to become vulnerable, Arum's decisions allow for his talent to get full credit for beating world class names yet risk little when it comes to the actual in-ring opposition.

Follow the career paths of fighters like Oscar De la Hoya, Floyd Mayweather, Miguel Cotto, or Manny Pacquiao and you will see the promoter's handy work in action. Brought to the top via their considerable talent and ambition, they were made superstars with the help of skillful matchmaking by Arum.

De la Hoya, with an Olympic Gold Medal on his resume, was carefully brought along against increasingly recognizable names who were either on the downside of long careers or just about to begin their career descent. Names like John John Molina, Jorge Paez, and most famously, Julio Cesar Chavez helped turn "The Golden Boy" from interesting prospect into the biggest name in the sport and one of the biggest non-heavyweight draws of all-time.

Mayweather, also a decorated amateur and Olympic medalist, was brought along in a similar manner, against fighters whose name value, in some cases, was perhaps greater than their competitive value.

Puerto Rican star, Miguel Cotto, tore through a line-up of faded veterans and low-risk/big name foes like Cesar Bazan, Carlos Maussa, and Gianluca Branco en route to superstar status.

Filipino legend, Manny Pacquiao, has also benefited from shrewd and calculated matchmaking. Some would even say that Manny is Arum's masterpiece as far as smart opponent selection goes. The eight-division titlist has enjoyed a steady stream of faded resume builders ever since beginning his climb in weight in 2008. Of Pacquiao's six opponents since his demolition of fringe titlist, David Diaz at 135 lbs., five were coming off career-defining losses in their recent past and all six were considered to be on the decline.

Now, "The Filipino Flash," Nonito Donaire seems to be Arum's next upcoming star and the aged boxing mind of Arum is applying the same winning strategy to his rise.

In February, Donaire blew right through Fernando Montiel, stopping the Mexican veteran in two rounds and officially becoming a world class, main stage star in the process. Montiel, who earned much of his greatest success at flyweight and super flyweight, was a two belt bantamweight titlist at the time of his loss to Donaire and a legitimately well-regarded champion despite being above his optimal weight and, at a very seasoned 32, a little long in the tooth.

Later this month, Donaire will be back in action against 35-year-old undefeated veteran world titlist, Omar Narvaez, who is moving up one division to fight for the bantamweight title. While Narvaez is a current belt holder at super flyweight, he is best known for his work at flyweight.

Donaire will be entering the ring as a huge favorite and will have every physical advantage over his opponent. However, Narvaez will be a big name on Donaire's resume and, despite the real possibility of an easy blow-out, the win will go a long way in helping define the legacy of the Filipino-American star— even if other fighters would be significantly tougher opponents.

In boxing, perception is reality and a list of quality names is often more important to a fighter's legacy and earning potential than a list of quality fighters. Nobody knows this better than Bob Arum— and nobody plays the game better.

Paul Magno was a licensed official in the state of Michoacan, Mexico and a close follower of the sport for more than thirty years. His work can also be found on Fox Sports and The Boxing Tribune. In the past, Paul has done work for Inside Fights, The Queensberry Rules and Eastside Boxing.

Sources:

Boxrec, Boxrec Stats and Info, Boxrec

The Boxing Tribune, The Boxing Tribune Editorials and Fight Reports, The Boxing Tribune

Note: This article was written by a Yahoo! contributor. Sign up here to start publishing your own sports content.

Tech wrap: Google profit expectations eat dust

Google’s third-quarter results trounced Wall Street expectations as good cost controls helped boost the Internet search leader’s profit by about 26 percent. The world’s No. 1 Internet search engine said its net income in the three months ended September 30 totaled $2.73 billion, up from $2.17 billion in the year-ago period.

Analysts applauded Google’s results. “Christmas came early for Google shareholders. It’s all about the core business. You drive that extra revenue and expense becomes secondary. It was a great beat on the bottom line. It’s not necessarily because they are controlling expenses. It’s because they are driving more revenue”, said Colin Gillis of BGC Partners.

RIM’s co-CEOs apologized to millions of BlackBerry customers for a four-day outage that tarnished it’s image and set back the drive to catch up with Apple and other smartphone rivals. The service disruption could cost RIM millions of dollars in compensation to customers who lost service. The company did not say for certain whether it would compensate customers. Public relations specialists said its response to the crisis has been slow and poorly communicated.

Spotify, the European music streaming service backed by digital entrepreneur Sean Parker, has more than 250,000 paying users in the U.S. since it opened up shop in July, according to three people familiar with its data. Digital music subscription services are hoping to pick up the slack of lost CD sales for the music business by offering large libraries of songs for an-all-you-can-eat monthly fee by streaming songs over computers, mobile devices and more recently in cars.

A court slapped a temporary ban on the sale of Samsung’s latest Galaxy tablet in Australia, handing rival Apple another legal victory in the two firms’ global patent war. Whilst the ruling is a blow for Samsung, the Australian market is not large. A more important legal battle starts later today, when a Californian court begins hearing Apple’s bid to ban sales of Galaxy products in the United States.

Netflix’s U.S. customers will be able to watch shows like “Gossip Girl” and “The Vampire Diaries” online after it signed programing deals with CBS and Warner Bros for shows from their joint venture, The CW television network. Under the pact, older-season episodes of some shows, including “One Tree Hill” and “Nikita”, will available October 15 while others are set for January.

Stocks slide on JPMorgan tech rally trims losses

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, On Thursday October 13, 2011, 4:50 pm

NEW YORK (AP) -- Stocks sank Thursday, ending the fastest rally in the S&P 500 since March 2009.

Bank stocks dragged the market lower after JPMorgan Chase & Co. reported that a slowdown in investment banking hurt its results in the third quarter. An afternoon surge in technology stocks limited some of the losses.

The Dow Jones industrial average fell 40.72 points, or 0.4 percent, to close at 11,478.13. JPMorgan fell 4.8 percent. Other banks also fell. Citigroup Inc. dropped 5.3 percent, Morgan Stanley 4.4 percent and Bank of America Corp. 5.5 percent.

JPMorgan is the first big U.S. bank to report earnings. Next week Wells Fargo & Co., Citigroup Inc. and Morgan Stanley will report. JPMorgan is widely considered the strongest U.S. bank, so the results don't bode well for other financial companies, said Jason Lilly, a portfolio manager at Rockland Trust Investment Management Group. JPMorgan's income fell 4 percent, hurt by a 31 percent plunge in investment banking fees.

An afternoon rally in technology stocks trimmed some of the market's losses. Yahoo Inc. rose 1 percent as investors speculated the company might be bought. Technology stocks in the Standard & Poor's 500 index rose 1 percent, the most of any industry group in the index. The technology-focused Nasdaq composite rose 15.51, or 0.6 percent, to 2,620.24.

"There's a mounting interest in Yahoo and that has filtered out into tech stocks," said Quincy Krosby, a market strategist for Prudential Financial.

There was other encouraging news from the technology industry. Apple Inc. rose 1.6 percent a day ahead of the release of its latest iPhone. Google's third-quarter earnings, released after the close of trading, soared past analyst expectations. The stock jumped 5.4 percent in after-hours trading.

The Standard & Poor's 500 index fell 3.59, or 0.3 percent, to 1,203.66. Financial stocks fell 2.4 percent, the most of the 10 company groups that make up the index.

Investors were also disappointed by a report that China's trade surplus narrowed for a second straight month in September. That suggests the Chinese economy is slowing more than previously thought, which could hurt demand for exports from the U.S.

Stocks soared over the past week on signs that Europe was starting to get a handle on its financial crisis. The Standard & Poor's 500 index soared 9.8 from Oct. 3, when it closed at its lowest level of the year, through Wednesday. That was the biggest 7-day jump in the S&P 500 since March 2009.

The sharp highs and lows are typical of the volatility that has plagued markets since August, when investors began reacting to fears that indebted economies in Europe would collapse and the U.S. would slide back into recession. Most analysts think that the market is in for more swings until a resolution to Europe's debt is reached.

"Europe will definitely contribute to more volatility. That story isn't done." said Lilly.

In Europe, there was more progress toward strengthening a financial rescue fund aimed at shoring up the region's banks. Slovakia's parliament approved a measure that would release large amounts of money to European banks and governments before a full-blown crisis sets in. Slovakia had blocked the bill Tuesday, becoming the only one of the 17 countries that use the euro to do so.

Wall Street has been fearful for months that one of Europe's shakier economies could collapse. If countries like Greece, Spain and Italy can't repay their debts, global banks that own those countries' debt would be at risk. That could make banks even more leery of lending to each other and to businesses. If that escalates enough, it could cause another international financial crisis similar to what happened in late 2008.

Officials in Europe seemed like they were making progress toward shoring up European banks. In addition to the stronger bailout package, European Commission leaders had said they would require banks to hold more capital to protect them against losses. But without specifics on how those reforms will be accomplished, traders are getting concerned that the plans will deteriorate.

In corporate news, BlackBerry-maker Research in Motion Ltd. Fell 1.7 percent after a three-day outage that cut off service to users across the world. The company said it had fixed the problem, which resulted from a breakdown in its European infrastructure.

The Blackstone Group LP lost 5.4 percent after a Citi Investment Research analyst dropped the private-equity firm from a list of favorite stocks, saying the firm won't be able to make strong real estate investments for some time because of the weak economy.

Chip-maker Broadcom Corp. rose 2.3 percent after an analyst upgraded the company, saying it was selling more chips for smartphones.

Fitch puts three U.S. banks on review for downgrade

(Reuters) - Fitch Ratings placed Bank of America Corp (NYSE:BAC - News), Morgan Stanley (NYSE:MS - News) and Goldman Sachs Group Inc (NYSE:GS - News) on review for possible downgrades on Thursday.

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The ratings agency, which also put six European banks on review for downgrades, said the institutions' viability ratings and long-term issuer ratings were on "negative" watch as its analysts engage with the companies and review any new information they receive.

The cuts would in most cases be one notch and in some cases two notches, Fitch said.

"These institutions' business models are particularly sensitive to the increased challenges the financial markets are facing," Fitch said in a press release. "These challenges result from both economic developments, particularly in the euro area, as well as a myriad of regulatory changes."

(Reporting by Lauren Tara LaCapra in New York; Editing by Gary Hill)

Tuesday 11 October 2011

7 Insurance Tricks That Cost You Money

Is there a way to get insurance against insurance? For some who have been victims of the scrupulous practices of some insurance companies, they probably wish they could purchase some protection against their insurance. Sadly, we often feel like we're at the mercy of the insurance giants, but there is a way to level the playing field: education. If you know their tricks, you know how to avoid them.

More from Investopedia:

Unique Insurance Policies You Should Consider

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1. You May Not Need Collision Insurance

So you purchased an older model car. It's only worth $2,500 and is seven or more years old. As your car depreciates, it gets closer and closer to your deductible. Remember that the insurance company won't pay you any more than the value of your car, so if the value is the same or less than your deductible, you won't get any money. If you're driving an old car, consider not getting collision insurance. The minimum policy required by law is enough in your case. Don't count on your insurance agent to tell you, though.

2. If You Have a Car Loan, You Need Gap Insurance

After you got rid of that old car, you purchased a shiny new car complete with that brand new car smell that everybody loves. You took out a loan for $25,000 and drove home. Two weeks later your car was totaled and the insurance company offered to pay you $21,000 for the car. The bank is going to still want the $25,000 you owe, so you'll be on the hook for the other $4,000.

Without gap insurance, you have to pay it out of your pocket. If you have a loan for your car, you should also consider gap insurance.

3. Anti-Concurrent Language in Your Policy

You live in a coastal town and recently a major hurricane came through and caused major damage to your home, including tens of thousands of dollars in flood damage. Everything will be covered because you have hurricane insurance as part of your homeowner's policy, right? Wrong!

Your insurance company tells you that because of the anti-concurrent language in your policy, nothing is covered because flood damage isn't covered even though the damage was clearly caused by the hurricane. Adding insult to injury, they tell you that you should have read your policy. Does all of this sound confusing?

Make sure to ask your insurance agent about the anti-concurrent language in your policy and ask them to show it to you in the policy.

[Most Expensive Cars to Insure]

4. You'll Never Understand It, Anyway

Have you ever tried to read your insurance policy? Regardless of your level of education or your street smarts, these policies are written in an extremely complicated way, but this problem is quickly being solved. Legislation in more than half of the United States has been introduced or enacted in to law making insurance companies write their policies in plain English. Always ask for an explanation of the policy if you don't understand it. Do you have a phone that allows you to record? Turn the microphone on and record the insurance agent's explanation.

5. We Use Your Credit Score to Determine Your Rate

Had some troubles paying your bills? Bankruptcy? These may not seem like unreasonable items for your insurance company to look at if they're trusting you to make payments on your policy, but think of it another way: What if you believe in paying cash for everything and you have no credit? What if you're elderly and no longer make purchases requiring credit?

This practice assumes that having credit makes for a responsible person when in actuality, some people are so responsible that they don't need credit at all. When receiving a rate quote, ask the agent if they used your credit score as a metric to determine your rate.

6. We Get a Bonus If We Hassle You

According to a North Dakota Insurance Department report released in 2007, Farmers Insurance used to have an incentive program called "Quest for Gold" that rewarded adjusters with pizza parties and $25 gift cards if they met low payment goals. They weren't the only ones -- others rewarded adjusters with various gifts and pressured employees to meet low payment goals.

Before entering into negotiations with the insurance adjuster, know how much your car is worth, have a clear idea of the extent of your injuries and speak to an attorney if necessary. While not all insurance companies are going to act this way, they want to save money as much as you want to make money, so they will most likely not give you their best and fair offer without a little bit of negotiation on your part.

[The Most Stolen Vehicles in the U.S.]

7. We Consider It a Claim If You Call

A neighbor accidentally hit a baseball through your kitchen window, but you don't remember what your deductible is and you've never made a claim against your homeowner's insurance, so you call the company to collect some information. You tell them the situation and simply ask for information.

Your insurance company may view that as a claim and adjust rates accordingly and the call may go in into the CLUE (Comprehensive Loss Underwriting Exchange) report on your house, which is available to anybody with a financial interest in your home. That one phone call may make it difficult to get insurance for your home.

If you have a question about your policy and must call, make your question into a general question that you are asking to gain an understanding on your policy.

The Bottom Line

Not all insurance companies are out to get you, but like all types of businesses, there are honest and dishonest people and you have to protect yourself at all times.

5 Steps to a Secure Retirement

If you're like many Americans whose retirement savings took a major hit during the market meltdown a few years ago, you're probably wondering if you'll ever be able to retire. The eye-popping stock market drop in early August and the downgrade of the U.S. credit rating no doubt add to your jitters. Or maybe investment performance isn't your major worry. A spate of unemployment or depressed home values can make yesterday's vision of retirement seem like an impossible dream.

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Don't be discouraged: Recent statistics on recovering 401(k) and IRA balances suggest that many savers are already back on track. Plus, "Americans have proved themselves to be both resilient and resourceful," says Jay Wintrob, president of SunAmerica Financial Group, which recently released its "Retirement Re-Set" study. More than 80% of respondents to the survey said they learned important lessons in the past several years. "They are course-correcting — intending to work longer, save more, spend less and adjust their lifestyle expectations," Wintrob says.

Laraine Schigotzki is a classic example. With successful careers in commercial real estate, property management and corporate sales, Schigotzki, 46, was surprised when she became a victim of a faltering economy. "I never thought I'd get laid off, but now I look at it as a blessing," she says. After losing her job in 2008, Schigotzki enrolled in a U.S. Department of Labor retraining program to become a licensed skin-care specialist and went on to become certified as a holistic health professional. In 2010, she opened To Your Health Holistic Spa and Wellness Center, in Brick, N.J., where she offers organic skin and body treatments, health and nutritional counseling, and yoga classes.

Schigotzki's retirement savings are on hold while she builds her business, and she knows she has a lot of catching up to do. But she's banking on her new business, rather than relying on the stock market alone, to fund her retirement. "I am optimistic, and I'm not stressing about my future finances," she says. "I am putting my heart and soul into this, and I know I'll come out on top."

Nancy and Al Guido hoped to retire to their hometown of Chicago after living in Dayton, Ohio, for 17 years. But the collapse of both their investments and their home's value in 2008 — a year before their planned retirement date — blew away their plans to buy a house in the Windy City. They didn't let their initial disappointment stop them, however. They turned market forces into an advantage by shifting their home search to low-cost Alabama, where they scooped up a beautiful lakefront home near Birmingham at a bargain price. "We couldn't have afforded this house a few years earlier," says Al, 62.

The past few years have demonstrated that being flexible like the Guidos is an essential ingredient in retirement planning during these uncertain times. Follow our five-step guide to make the new normal work for you.

Step 1 | DO A REALITY CHECK

The main question on everyone's mind is, Will I have enough money to retire? More than half of those who participate in an employer-based retirement plan say that they have never taken the time to estimate how much they need to save for retirement. If you don't have a savings target in mind, it's tough to determine whether you are on track, says financial planner Philip Lubinski, head of the Strategic Distribution Institute, in Denver. Figure out your target number and whether you're saving enough to reach it by the time you want to retire.

"Some may be assuming they are off-track, when in fact, they aren't — or not as much as they think," says Lubinski. The answer to the burning question of Will I have enough? is determined by several factors, including when you plan to retire, how much income you need from your savings, how many years you'll need that income and the rate of return you can expect to achieve on your investments.

If you discover a shortfall between the amount you need to save and the amount your current account balance and continued savings will be worth by your target retirement date, then you'll have to make some tough choices. You could save more, work longer, chase higher returns or plan to throttle back on your retirement lifestyle — something most people hope to avoid.

"Americans are recalibrating their retirement dreams," says Carrie Schwab-Pomerantz, president of the Charles Schwab Foundation, which promotes financial literacy. "They don't want to buy a winery when they retire. They just want to keep living the life they've been living." J. Graydon Coghlan, a financial planner in San Diego, has observed a similar rethinking of retirement goals among his clients. "Instead of buying a second home, I see a lot of people fixing up their existing home to make it their retirement dream house and then just renting a place for a week or two in the desert or the mountains," says Coghlan.

Step 2 | PLAY CATCH-UP

It's been a volatile decade for the stock market, but investment returns are not solely to blame for the size of your retirement account. The main driver of account balances over time is your contribution rate. Investment returns, while important, have a less significant impact over the long term. For guidelines on how you should allocate your retirement savings at various ages, see the graphs below.

Ideally, you should aim to contribute 15% of your gross earnings to your retirement savings — including any employer matching contributions. The goal is to replace about half of your current salary, adjusted for inflation, during a retirement that could last 30 years or more. You'll probably replace another 30% or more of your current income with money from other sources, such as Social Security, a pension or part-time work, bringing you closer to 80% of pre­retirement income — generally the amount recommended to maintain a comfortable retirement.

Make sure you make the most of your company's retirement plan. According to a recent survey by Fidelity Investments, more than half of 401(k) participants say they would not be saving for retirement at all if it weren't for their company retirement plan. But economic conditions still present a challenge, with 54% reporting that they would contribute more to their 401(k) plan if they could. If you can't max out your contributions immediately, contribute at least as much as needed to capture your employer's matching contribution if you have one and work toward saving more in the future. In 2011, you can contribute up to $16,500 to a 401(k) or similar defined-contribution plan, such as 403(b) plans used by schools and hospitals, 457 plans available to state and local workers, and the Thrift Savings Plan available to the military and federal employees. Workers 50 and older can make additional catch-up contributions of up to $5,500, for a total of $22,000 in 2011.

If you don't have access to a retirement plan at work — or even if you do but you want to stash more money away — you can contribute up to $5,000 to an IRA in 2011, or $6,000 if you are 50 or older. You can choose a traditional IRA, which offers an upfront tax deduction for workers who meet the income requirements. Or you can choose a Roth IRA, which has no upfront tax deduction but provides tax-free income in retirement. Self-employed business owners can contribute up to $49,000, depending on income, to a SEP IRA for 2011, or up to $54,500, including catch-up contributions, to a solo 401(k).

Step 3 | WORK LONGER

The number of Americans age 55 and older in the workforce is now at an all-time high. Judith Randall, 72, of Chicago, is one of them. She describes her seasonal job as a guide on the city's river cruises and bus tours as "the best part-time job in the world." The retired legal secretary puts all her research skills to work, uncovering fascinating facts to share with her audiences. But the bottom line is that she needs the money. She relies on her earnings to supplement Social Security in order to pay her bills, and she squirrels away her tips for the winter, when there's no work. "I didn't save enough when I was working as a legal secretary," she says. "I have to work as long as I can."

Unfortunately, working longer may not be an option for some. More than 40% of current retirees stopped working earlier than they had planned, largely for reasons beyond their control, such as a layoff or health problem. And with more than two million people age 55 and older unemployed, the prospects of finding full-time work in their field are dim.

"More and more baby-boomers over age 50 are realizing that when they lose their corporate job, the only way that they can continue to do the work they were doing is to run their own business," says Jeff Williams, founder of Bizstarters.com. He offers a free "Boomer Biz Starter Kit" on his Web site, which includes an idea-generator guide to show how to use work and life experience to find good business ideas and how to evaluate the financial prospects of those ideas.

Step 4 | CREATE RETIREMENT INCOME

One of the greatest challenges in retirement is figuring out how to convert a pile of savings accumulated over a lifetime into a monthly stream of income that you can't outlive. The Government Accountability Office made headlines recently when it recommended that middle-income Americans — particularly those without a traditional pension — consider using up to half of their savings to buy an income annuity as a way to avoid the risk of outliving their money.

The drumbeat for guaranteed retirement income has been building during the past few years. When asked which is more attractive, a financial product providing a 4% return that is guaranteed not to lose value or one with an 8% return that is subject to market risk and loss of principal, 76% of respondents chose the guarantee, according to Allianz Life Insurance Co. "This new study confirms that a 'new normal' mindset has dug deep roots in the minds of boomers," says Allianz Life president Gary Bhojwani.

Capitalizing on the demand for secure income, New York Life Insurance Co. has launched a new annuity product that enables individuals to create a personal pension by investing a minimum of $10,000 initially and setting a future date to begin receiving guaranteed income payments for the rest of their life.

"The concept of a pension is certainly not new, but paying for it with cash rather than years of service is," says Chris Blunt, executive vice-president of retirement income security for New York Life. Blunt, 49, bought the first contract, investing $100,000 with the guarantee that he will receive $980 per month — nearly a 12% payout — starting at age 65 for the rest of his life, with annual inflation adjustments.

Unlike immediate annuities, which are typically sold to retirees in their seventies, this deferred annuity is targeted to preretirees in their fifties and early sixties who don't have a pension or whose pension was frozen and won't provide sufficient income in retirement, Blunt says.

Other insurers are also making it easier for consumers to figure out how an annuity might fit into their retirement-income puzzle. Anyone can use Fidelity's Income Strategy Evaluator to help decide how to allocate his or her portfolio to stocks, bonds and cash. The tool also shows how buying one or more annuities can create guaranteed income and provide protection from inflation and market volatility. MetLife recently unveiled its own version, the Retirement Income Selector.

Step 5 | DELAY SOCIAL SECURITY

Among the most crucial financial choices retirees must make is when to begin claiming Social Security benefits. The majority claim benefits before their normal retirement age, passing up an additional 25% or more in monthly inflation-adjusted benefits for the rest of their lives. That can be a costly mistake — particularly for some married couples, who can increase their lifetime retirement income by $100,000 or more just by choosing the right time and method for each spouse to claim benefits.

The GAO's report on retirement income found that it is more cost-effective to delay collecting Social Security benefits until normal retirement age than to collect them early with the intention of buying an annuity later on to make up the difference. Delaying benefits until normal retirement age — 66 for anyone born from 1943 through 1954 and gradually rising to 67 for those born in 1960 and later — means you can continue to work without forfeiting any benefits to the earnings cap limit. You can also employ some clever claiming strategies to maximize your benefits.

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