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Why is an AFHU Hebrew
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the Ladder Of Life:
"A penny saved is a penny earned."
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It drives the next
generation of
technology.
4 3
'7
President Obama views Mobileye in action— see video at www.afhu.org/CGA2
On his recent state visit to Israel, President Obama received a demonstration of
Mobileye from Amnon Shashua, the Sachs Family Professor of Computer Sciences at
The Hebrew University of Jerusalem. Mobileye, an Advanced Driver Assistance System,
saves lives and boosts automotive safety.
The Hebrew University of Jerusalem
is an engine of innovation and
discovery for Israel and our
global community.
When you create a secure AFHU
Hebrew University Gift Annuity—
with its high lifetime return, income
tax deduction and partially tax-free
payments—your annuity drives
Israeli-led innovation toward a
better and safer future.
AFHU Hebrew University
Gift Annuity Returns
Age
Rate
67
7o
6.2%
6.5%
7.1%
8.o%
9.5%
11.3%
75
8o
85
90
Rates are calculated based on a
single life. Cash contributions produce
partially tax-free annuity income.
Share in the vision of Albert
Einstein, a founder of The Hebrew
University. Help propel a catalyst
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for research and learning that
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For information on AFHU Hebrew University
Gift Annuities, please call AFHU Midwest
Region Executive Director, Judith Shenkman at
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Founded by Albert Einstein, Sigmund Freud, Martin Buber and Chaim Weizmann.
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44
May 9 • 2013
M
y grandfather always said
to me, "A penny saved is a
penny earned:' I heard these
words but never comprehended their
true significance. I remember saying to
myself, "So what good will it do me if I
save 25 cents here and there?"
Recently, it dawned on me that the
expression really contemplates the
maxim that your earnings are not
dependent on your spending habits. This
means whatever you don't spend ulti-
mately accumulates long-term toward
retirement savings. For instance, if you
elected to forego one $6,000 vacation
each year (rather than taking two) for
20 years with accumulated interest
compounding on $500 per month at 8
percent, you'd have $294,510.
When you're in elementary school,
you can't fathom issues and tribula-
tions that will unfold once
you step into the real world.
When events such as the
Boston Marathon bombings
or the Kennedy assassinations
occur, children observe the
process but are not able to
comprehend or feel the emo-
tional trauma. In high school,
you really don't understand
the career-related decisions
you will be required to make
during your college years;
and when you exit college
you don't realize what lies ahead in the
realm of full-time employment, mar-
riage and raising your own family.
It doesn't stop there. In your 30s,
you have a certain perspective on life,
family and friends — which changes as
you enter your 40s — and then again
in your 50s, and again and again with
each rung. During the 30s and 40s, the
focus is on funding the current expens-
es that begin with nursery school,
dance classes, soccer and baseball, and
summer camp and steadily climb to
funding transportation and then college
expenses.
For many of us, the task of saving for
retirement is sacrificed because of the
current financial pressures at this stage.
If you're like me, in this era you had
long ago dismissed that "penny saved,
penny earned" notion, thinking that
today's world doesn't revolve around
pennies.
When we reach our 50s — a breath
of fresh air comes as the nest empties.
(These days, however, that nest seems
to repopulate itself as kids seem to "go
and come" rather than "come and go!")
Finally, there is an opportunity to stash
funds toward retirement. As the 50s
mature, we are also faced with address-
ing our parents' needs as their age over-
takes their mobility and acuity levels.
We are thrust into uncharted waters
and forced to make decisions
that sometimes are in opposi-
tion to our parents' expressed
wishes. Here, we often gain
greater insight into our par-
ents' financial status, which,
as I often comment, can
reveal a situation where their
Social Security and minimal
retirement savings are inade-
quate to cover essential costs.
Even worse, this inquiry may
reveal that they have depleted
IRAs and savings to pay cred-
it card bills and mortgage payments
when smarter alternatives existed.
Our mindset is short-term. In col-
lege, we think only so far as 20s and
30s. In our 30s, we think about our
40s and maybe the 50s; and in our 50s,
we think about 60s and 70s — but not
much about the 80s. This is a mistake.
We need to think beyond two rungs.
If you're addressing issues with your
parents who are in their 80s, then
perhaps you should also think about
how you want these issues addressed
by your children when you are in your
80s. You will gain a better perspective
on your parents' emotions and properly
plan for your senior years. Better yet,
if you are still in your 30s, focus where
you will be in your 60s and 70s. Do this
and you will gain a 20-year advantage
by understanding what my grandfather
meant about a penny saved is a penny
earned!
❑
Ken Gross is an attorney with Thav Gross
and host of the Financial Crisis Talk Center
show that airs weekly at 9 a.m. Saturdays
on WDFN 1130 AM, "The Fan" and 1 p.m.
Sundays on MyTV20.