First Centennial Bank of Redlands, California, was seized by a state regulator, the third U.S. bank to fail this year, as the recession deepens and the slump in the housing industry sends home foreclosures to records.

COBRA Coverage Is Unaffordable for Most Laid-Off Workers

Although federal and state laws provide a potential health lifeline for laid-off workers, the costs of the coverage they provide are usually prohibitively high.

However, when people are laid off from their jobs, if they want to continue coverage under COBRA, they must pay the entire cost of the premium plus a 2 percent administrative fee.

The national average cost of employer-provided coverage for an individual, plus a 2 percent fww, amounts to $4,656 a year, or $388 amonth.  For family coverage, the cost jumps to $12,823, or $1069 a month.

Nationally, to maintain single coverage, the average unemployed worker would need to spend 30 percent of his or her unemployment insurance (UI) check on COBRA Premiums.

Courtesy of FamiliesUSA.org

President George W. Bush will ride out the recession with a pension of $196,700. The pension begins immediately upon his departure from office at noon on Inauguration Day, January 20. And unlike many private sector pensions, Bush’s payouts will grow to $203,600 next year and $210,700 in 2011.

Vice President Dick Cheney will weather the bear market with a pension worth an estimated $132,451 per year. His pension, based on service as a Representative, Vice President, and other executive branch posts, will also be regularly adjusted for the cost of living.

Courtesy of USNews.com

The pension plans of the companies in the Standard and Poor's 500-stock index were underfunded by about $362 billion in 2008, according to David Zion, an analyst at Credit Suisse. Of the 500 companies in the index, 360 had plans that were underfunded.

"It may be quite likely that you work for someone that has an underfunded pension plan, but if I was in that situation, would that worry me? Not as long as I was under that maximum annual guarantee of the PBGC. The vast majority of people are," said Jack L. VanDerhei, research director for the Employee Benefit Research Institute.

Finding out whether your pension is underfunded isn't hard but takes a little digging. If you work for a publicly traded company, you can look at your employer's annual report, also known as a 10-K, which it is required to file with the Securities and Exchange Commission. Look for a line that gives the company's benefit obligation and another that lists the plan's assets. Let's say the assets amount to $90 million and the obligation is $100 million. That means your pension is 90 percent funded.

Courtesy of WashingtonPost.com

Here's a recap of money market yields (7-day yields) from several mutual fund companies:

Vanguard Prime (VMMXX) 2.14%

Fidelity Cash Reserves (FDRXX) 1.78%

T. Rowe Prime Reserves (PRRXX) 1.07%

Schwab Investor MM (SW2XX) 1.11%

The Social Security Administration, envisaging the near-future prospect of 10,000 baby boomers applying for benefits every day, has put together a new online service that will allow people to get their benefits without ever traveling to a Social Security field office.

The agency, in introducing the program Tuesday, said most people will be able to apply for their retirement or disability benefits in 15 minutes or less.

Those wanting to use the new program can go to www.socialsecurity.gov and click on "Applying Online for Retirement Benefits."

We've been getting a lot of inquiries on the new MRD rules for 2009 and received a frequent question. Fortunately, a recent issue of the Wall Street Journal provides the answer:

If I turned 70½  in 2008 and had planned to take my first withdrawal by the April 1, 2009 deadline, does the new law permit me to skip it?

A: No. The law suspends distributions only for 2009. Although first-timers are allowed to delay 2008's distribution until April 1, 2009, the withdrawal still counts toward your obligation for 2008, Mr. Slott says. So, if you turned 70½ in 2008 and decided to wait until April 1, 2009, to make your first withdrawal, that deadline still applies. To calculate this distribution, you would use your account balance as of Dec. 31, 2007.

Most contributions that go into your 401k plan or 403b plan are "pre-tax" monies. Some plans allow deferrals above the limits and are ear-marked as "after-tax" contributions.  Plan providers will be able to tell you if there are any after-tax monies in your plan. Those after- tax monies may be eligible to be converted to the Roth IRA.

Kiplingers.com explains:

Not all retirement plans allow after-tax contributions. But if yours is among those that do, this is a great way to keep some of your retirement savings growing tax free without paying the usual price of admission to convert to a Roth IRA. Normally, you must wait to switch jobs or retire before you can move money out of your employer-based retirement account. But some plans permit in-service distributions, allowing you to roll over some or all of your 401(k) money to an IRA once you reach age 59 1/2 .

Every Friday, the Edison Lounge in Los Angeles transforms itself into a soup kitchen to, in their words, "maintain perspective through this financial crisis and to support those truly in need." Enjoy bathtub gin in the form of "Your 401(k)," or the bourbon "Bail Out," as well as free grilled cheese and tomato soup. 25% of net proceeds go to charity, and you're encouraged to make extra donations on top of tips. With each cocktail downed, drinkers are also encouraged to write down their feelings about the economy.

President Bush signed legislation today that offers a measure of tax relief to retirees next year. The Worker, Retiree, and Employer Recovery Act was also passed by both houses of Congress earlier this month.

The bill allows retirees to avoid making withdrawals from depleted 401(k)s, IRAs, and 403(b)s in 2009. But seniors over age 70 ½ need to take withdrawals this year by December 31 or face an excise tax of 50 percent of the amount that should have been withdrawn plus income tax.

Remember this does not impact your MRD this year- you'll have to take distributions from retirement accounts for 2008.