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Planning for retirement in a volatile market

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Planning for retirement in a volatile market

Dear Liz: I have a retirement account at work and a stock portfolio. Both are down significantly this year and I’m tired of losing money. What are the safest options now?

Answer: Before the “what” you need to think about the “why” and the “when.” Why are you investing in the first place? And when will you need this money?

If you’re investing for retirement, you may not need the money for years or decades. Even when you’re retired, you’ll likely need to keep a portion of your money in stocks if you want to keep ahead of inflation. The price for that inflation-beating power is suffering through occasional downturns.

You won’t suffer those downturns in “safer” investments such as U.S. Treasuries or FDIC-insured savings accounts, but you also won’t achieve the growth you likely need to meet your retirement goals. In fact, you may be losing money after inflation and taxes are factored in.

Also keep in mind that if you sell during downturns, you’ve locked in your losses. Any money that’s not invested won’t be able to participate in the inevitable rebounds after downturns. Plus, you may be generating a tax bill, since a stock that’s down for the year may still be worth more than when you bought it. (You don’t have to worry about taxes with most retirement accounts until you withdraw the money, but selling stocks in other accounts can generate capital gains.)

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The exception to all this is if you have money in stocks that you’re likely to need within five years. If that’s the case, the money should be moved to investments that preserve principal so the cash will be there when you need it.

Dear Liz: I am a retired special education teacher who receives a government pension. The recent law change now permits me to also receive Social Security. I have 38 of the 40 credits required in order to qualify. Am I better off getting a job to earn those two credits? Another teacher explained to me that I can be paid 50% of my husband’s Social Security benefit instead. That would likely be greater than my own Social Security benefit. We would both wait until we are 70 to collect Social Security.

Answer: The Social Security Fairness Act did away with the windfall elimination provision and the government pension offset, two rules that reduced Social Security benefits for people receiving pensions from jobs that didn’t pay into Social Security.

As you’ve noted, to qualify for your own benefit you would need 40 quarterly credits or 10 years of work history at jobs that paid into Social Security. If your credits were earned decades ago at low-paying jobs, then your spousal benefit might well be larger than your own retirement benefit.

Your spousal benefit can be up to 50% of your husband’s benefit at his full retirement age. Spousal benefits are reduced if you start before your own full retirement age, which is presumably 67, but won’t be increased if you wait beyond that age. Your husband must be receiving his own benefit before you can get a spousal benefit.

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The rules can be complex so you’ll want to educate yourself thoroughly and consider consulting a financial planner to figure out the best claiming strategy.

Dear Liz: My husband passed away in January 2024. He retired from the U.S. Postal Service after 37 years. He drew off of my Social Security since he did not pay in. How will the change in the windfall elimination provision affect me?

Answer: It may not.

Social Security has promised to increase benefits and make retroactive payments to people affected by the windfall elimination provision and the government pension offset. The retroactive payments reflect the increase in their payment amount dating back to January 2024, when the two provisions stopped applying. Social Security is mailing notices to people who will be affected, and most will see the benefit increases starting this month.

Technically, you weren’t affected by either provision, since they applied to people receiving pensions that didn’t pay into Social Security, not their spouses. Your husband’s Social Security spousal benefit likely was reduced because of the government pension offset.

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Since your husband died the month that the two provisions stopped applying, the amount Social Security may owe him retroactively is likely small, if anything. If you don’t get a notice or see a payment, you can call Social Security to inquire, but the agency says most affected beneficiaries will get their adjustments automatically.

You can learn more about the Social Security Fairness Act here: https://www.ssa.gov/benefits/retirement/social-security-fairness-act.html.

Liz Weston, Certified Financial Planner®, is a personal finance columnist. Questions may be sent to her at 3940 Laurel Canyon, No. 238, Studio City, CA 91604, or by using the “Contact” form at asklizweston.com.

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130,000 Igloo Coolers Recalled After Fingertip Amputations From Handle

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130,000 Igloo Coolers Recalled After Fingertip Amputations From Handle

About 130,000 Igloo coolers were recalled on Thursday after consumers reported 78 fingertip injuries from the cooler’s tow handle, 26 of which led to fingertip amputations, bone fractures or cuts, according to the U.S. Consumer Product Safety Commission.

This warning expands an initial recall issued in February of more than one million 90-quart Igloo Flip & Tow Rolling Coolers because the tow handle was crushing and seriously injuring people’s fingertips.

“The tow handle can pinch consumers’ fingertips against the cooler, posing fingertip amputation and crushing hazard,” the recall said.

In the February recall, the safety commission said that Igloo had received 12 reports of fingertip injuries from the coolers. Since then there have been an additional 78 reports, according to the commission.

The recalled coolers, all of which have the word “IGLOO” on the side of them, were manufactured before January 2024 and come in different colors. The manufacture date can be found on the bottom of the cooler.

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The commission said the latest recall also affected about 20,000 coolers in Canada and 5,900 in Mexico, which is in addition to the tens of thousands recalled from each country in February.

Igloo said that owners who bought the coolers between January 2019 and January 2025 should stop using them and contact the company for a free replacement handle.

The company said in a statement that it stood behind the quality of its products and that consumer “safety and satisfaction” were its top priorities.

The coolers were sold at Academy, Costco, Dick’s, Target and other retailers and online stores and were usually priced between $80 and $140.

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Insurance commissioner signals possible probe into State Farm's handling of L.A. wildfire claims

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Insurance commissioner signals possible probe into State Farm's handling of L.A. wildfire claims

After fielding a storm of complaints at a community meeting about how State Farm General is handling Los Angeles wildfire claims, California Insurance Commissioner Ricardo Lara said Saturday that regulators might launch a formal inquiry into the company’s practices.

Lara made his comments during a Zoom session attended by more 200 survivors of the Palisades and Eaton fires, who complained about delays in handling their claims, difficulty in getting testing for toxic substances and low cash offers to fix damaged homes and replace those destroyed.

“It’s not off the table,” said Lara, referring to the department’s authority to conduct what is called a “market conduct” exam into the company’s response to the fires. “We are not necessarily opposed to that.”

The department has previously conducted such investigations following other large fires.

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The Zoom session was organized by the Pali Strong community group, which was formed by Pacific Palisades residents after the Jan. 7 fires.

State Farm, on Sunday, said in response that it has the largest claims force in the industry and it is “focused on our customers and helping them recover from the largest fire event we have ever experienced in the state.”

“We actively work with each of our customers to resolve their claim by understanding the facts of their loss, identifying the damages and applicable coverage,” the statement said.

The company said that as of May 5 it had received more than 12,600 claims and paid more than $3.4 billion to customers.

Separately, Tony Cignarale, deputy commissioner of consumer services and market conduct, told the fire victims that the department sent the California FAIR Plan Assn. a letter last week seeking information into how the insurer of last resort is handling smoke damage claims.

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The FAIR Plan was sued last month by policyholders in both fire zones, who allege the state’s insurer is refusing to properly investigate and pay for smoke damage as required by state law. Also named as defendants are State Farm and other California licensed home insurers, who run the plan.

The threat to conduct a market conduct exam into State Farm General’s claims handling practices comes as California’s largest home insurer awaits a decision on its request for an emergency rate hike in response to its losses from the Jan. 7 fires.

The company originally filed for a 22% rate hike for its homeowner policies, but trimmed that down to 17% during a hearing last month before an administrative law judge.

The judge is expected to make a recommendation as early as this week to Lara, who can then accept, reject or revise the ruling. It also could be sent back for reconsideration.

Joy Chen, whose Altadena home was damaged by soot and ash, asked Lara to defer granting the company any rate hike until he “fully” investigates the complaints.

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“We’d be happy to submit them to you,” said Chen, a leader of the Eaton Fire Survivors Network.

Lara said that he could not tie any investigation into the complaints to consideration of the rate hike, which he said was a “separate judicial process that is currently underway.” However, he asked the fire survivors to submit all their complaints to the department so it could examine them.

“What I commit to doing is collecting all the data that I’m going to receive … and sending it to our law enforcement team, because I really want to look at … all the allegations that were talked about today,” he said.

Chen, who said her home was effectively remediated by her insurer, USAA, later told The Times, “Lara’s most important job is to protect California families but he is saying the department does not consider claims management when approving rate hikes — but this is one of the few legal powers he actually has to regulate the industry.”

Last week, the Los Angeles County Department of Public Health announced it found high levels of lead and other toxic metals at homes destroyed by the wildfires whose topsoil had been scraped by the U.S. Army Corps of Engineers, particularly in the Altadena area with its older housing stock.

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In regards to the FAIR Plan, Cignarale said the department’s letter to the insurer asked them “for very specific information as to the very steps that are being taken to resolve these smoke claims.”

Lara told the fire victims that he had issued a bulletin to state insurers in March stating that the department expected them to “fully investigate and pay legitimate smoke claims.” He said if that was not happening, fire victims should submit their complaints to the state so the department’s investigative unit could look into them.

He also said the department planned to convene health experts to develop state standards for smoke damage remediation. “Absent any set standards, then the insurance companies will do anything to get you back in your home as quickly as possible,” he said.

The FAIR Plan did not immediately respond to a request for comment.

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Why America’s ‘Beautiful Beef’ Is a Trade War Sore Point for Europe

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Why America’s ‘Beautiful Beef’ Is a Trade War Sore Point for Europe

Hendrik Dierendonck, a second-generation butcher who has become, as he describes it, “world famous in Belgium” for his curated local beef, thinks Europe’s way of raising cattle results in varied and delicious cuts that European consumers prize.

“They want hormone-free, grass-fed,” Mr. Dierendonck explained recently as he cut steaks at a bloody chopping block in his Michelin-starred restaurant, which backs onto the butchery his father started in the 1970s. “They want to know where it came from.”

Strict European Union food regulations, including a ban on hormones, govern Mr. Dierendonck’s work. And those rules could turn into a trade-war sticking point. The Trump administration argues that American meat, produced without similar regulations, is better — and wants Europe to buy more of it, and other American farm products.

“They hate our beef because our beef is beautiful,” Howard Lutnick, the commerce secretary, said in a televised interview last month. “And theirs is weak.”

Questions of beauty and strength aside, the administration is right about one thing: European policymakers are not keen on allowing more hormone-raised American steaks and burgers into the European Union.

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Further opening the European market to American farmers is just one ask on a laundry list of requests from the Trump team. American negotiators also want Europe to buy more American gas and trucks, to change their consumption taxes and to weaken their digital regulations.

Trade officials within the European Union are willing to make many concessions to avert a painful and protracted trade war and to avert higher tariffs. They have offered to drop car tariffs to zero, to buy more gas and to increase military purchases. Negotiators have even suggested they could buy more of certain agricultural products, like soy beans.

But Europeans have their limits, and those include America’s treated T-bones and acid-washed chicken breasts.

“E.U. standards, particularly as they relate to food, health and safety, are sacrosanct — that’s not part of the negotiation, and never will be,” Olof Gill, a spokesman for the European Commission, the E.U. administrative arm, said at a recent news conference. “That’s a red line.”

It is not clear how serious the Americans are about pushing for farm products like beef and chicken. But the topic has surfaced repeatedly. When U.S. officials unveiled a trade deal with Britain on Thursday, for instance, beef was part of the agreement.

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But according to Britain, the deal would simply make it cheaper for Americans to export more hormone-free beef to the country and would not weaken British health and safety rules, which are similar to those in the E.U.

When it comes to the European Union, the United States can already export a large amount of hormone-free beef without facing tariffs, so an equivalent deal would do little to help American farmers.

But diplomats and European officials have repeatedly insisted that there is no wiggle room to lower those health and safety standards. And when it comes to meat-related trade restrictions more broadly, there is very little. Chicken, for instance, faces relatively high tariffs, and there is limited appetite to lower those rates.

That’s because Europe is protective of both its food culture and its farms.

Where America tends to have massive agricultural businesses, Europeans have maintained a more robust network of smaller family operations. The 27-nation bloc has about nine million farms, compared with about two million in the United States.

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Subsidies and trade restrictions help to keep Europe’s agricultural system intact. The European Union allocates a big chunk of its budget to supporting farmers, and a mix of tariffs and quotas limit competition in sensitive areas. E.U. tariffs on agricultural products are around 11 percent overall, based on World Trade Organization estimates, though they vary hugely by product.

And the bloc could place higher tariffs on U.S. farm goods if trade negotiations fall through. Their list of products that could face retaliatory levies, published Thursday, includes beef and pork, along with many soy products and bourbon.

But it’s not just tariffs limiting European imports of American food. Strict health and safety standards also keep many foreign products off European grocery shelves.

Take beef. Mr. Dierendonck and other European farmers are banned from using growth stimulants, unlike in the United States, where cattle are often raised on large feedlots with the use of hormones. European safety officials have concluded that they cannot rule out health risks for humans from hormone-raised beef.

To Mr. Dierendonck, the rules also fit European preferences. The lack of hormones results in a less homogenous product. “Every terroir has its taste,” he explains, describing the unique “mouth feel” of the West Flemish Red cow he raises on his farm on the Belgian coast.

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But farming beef without hormones is more expensive. And American exporters have to adhere to hormone limitations when they send steaks, hamburgers or dairy products to E.U. countries, which European farmers argue is only fair. Otherwise, imports produced using cheaper methods could put European farmers out of business.

“We cannot accept import products that do not meet our production standards,” said Dominique Chargé, a cattle farmer from the west of France who is also president of La Coopération Agricole, a national federation representing French agricultural cooperatives.

The result is that the United States does not sell much beef to Europe. It makes more economic sense for U.S. farmers to sell into markets that allow hormone-raised cattle.

One frequent American complaint is that European health standards are more about preference than actual health.

American scientists have called the risks of hormone use in cows minimal. And though E.U. officials and consumers frequently sneer at America’s “chlorinated chickens,” that rallying cry is a bit dated. American farmers have for years been using a vinegar-like acid, and not chlorine, to rinse poultry and kill potential pathogens.

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Some studies in Europe have suggested that such treatments are not a replacement for raising a chicken in a way that makes it pathogen-free from the start. American scientists have concluded that the rinses do their job and are not harmful to humans.

“I don’t know that it’s really about the science,” said Dianna Bourassa, a microbiologist specializing in poultry at Auburn University. “In my microbiological opinion, there are no health implications.”

From the perspective of European farmers, though, whether the health risks are genuine is besides the point. So long as European voters oppose chemical-treated chicken and hormone-treated beef, Europe’s farmers cannot use those farming techniques.

“When you speak to our farmers, it’s about fairness,” explained Pieter Verhelst, a member of the executive board of a Belgian farmers’ union, Boerenbond. “The policy framework we start with is totally different, and those issues are mostly totally out of the hands of farmers.”

And European consumers do seem to support E.U. food and farming rules.

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Farmer protests last year loudly opposed more beef imports from South American countries, in part over concerns that the cows might be raised with a growth hormone. An Obama-era trade deal died in part thanks to popular anger over “chlorine chicken” (“Chlorhünchen,” to derisive Germans.)

E.U. public opinion polling has suggested that policies that promote farming and farmers are very popular. In a 2020 poll fielded in-person across the bloc, nearly 90 percent of Europeans agreed with the idea that agricultural imports “should only enter the E.U. if their production has complied with the E.U.’s environmental and animal welfare standards.”

In Europe, including at Mr. Dierendonck’s butchery and farm, there’s a value placed on the old-fashioned, small-scale way of doing things, policymakers and farmers agreed. Mr. Dierendonck does buy some American beef for customers who ask for it — it’s easy to cook, he said — but it’s a small part of the business.

“I like American beef very much, but I don’t like it too much,” said Mr. Dierendonck, explaining that to him, the beef his European suppliers provide is varied, like a fine wine. “For me, it’s about keeping traditions alive.”

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