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Managing Withdrawals CarefullyCan Protect Retirement Income

Once you retire, you’ll have to start tapping into your investment portfolio. How can you avoid takingout so much that you risk outliving your resources?You’ll need to establish a proper withdrawal rate – the percentage of your portfolio’s value neededfor one year’s worth of retirement expenses. Ideally, if could stick with this rate, your portfolio wouldlast as long as you do.When you start your retirement, you might want to go with a more conservative rate. This could beespecially helpful when the financial markets have declined. Yet, even starting with a more modestrate, you may need to make adjustments periodically.So, when the markets have declined, how should you respond? You could cut down on your spending,so you would need less money from your investments. But if you have already been withdrawing amodest amount, adjustments may not be necessary. The key is to review your withdrawals with yourfinancial advisor to determine if you remain on track or if adjustments need to be made.By managing your withdrawal rate carefully, and reviewing it over time, you can take greater controlover your retirement income.

BUSINESS PAGE 27AFriday-Sunday, July 3-5, 2020 DentonRC.com

Liz WestonPERSONAL FINANCE

COMMENTARY

Armadillo adds hard seltzer line, Rio Fresco

Armadillo Brewing Co., pro-ducer of Armadillo Ale Works craft beer, is expanding its prod-uct line to offer Rio Fresco hard seltzers.

The brand will initially be re-leased throughout Denton, and will be available in four flavors: agave lime, blood orange hi-biscus, watermelon limón and pineapple mango. In addition, single flavor six-packs will fol-low later in the summer.

The self-distributed product will be available at Denton re-tailers including the Armadillo

Ale Works taproom and coffee shop in downtown Denton.

Texas Mutual Insurance honors local businesses

Texas Mutual Insurance Co. announced that four Denton County employers have been awarded the company’s top workplace safety honor: David Boone Oilfield Consulting Inc., Red River Partners LLC, Refuel US LLC and Sacred Cross EMS Inc.

In total, 200 workplace safety awards were distributed throughout the state to busi-nesses that have exemplified on-

the-job safety. To qualify, a com-pany must implement a safety program aimed at preventing on-the-job injuries.

Gohlke Pools makes list of top 50 pool builders

For the third year straight, Gohlke Pools has been named as one of the Top 50 Pool Builders in the United States by Pool & Spa News, according to a news release.

Gohlke Pool is the only Den-ton County-based pool builder included on the list, based on independent customer-service surveys performed by Guild-

Quality, an Atlanta-based firm.To qualify, a company must

demonstrate high levels of staff management and training, par-ticipation in both industry asso-ciations and their communities, along with annual revenue and web presence.

“We are not one of the larg-er pool builders in our industry, but this recognition is an indica-tion of the dedication that every-one here at Gohlke Pools has to building every customer’s pool to meet the highest standards in our industry,” Matt Gohlke, president of Gohlke Pools, said in a statement.

BRIEFLYIN BUSINESS

— Staff reports

As a 58-year-old woman on disability, Robin Short of Wallingford, Connecticut,

relies on her tax refund to catch up on bills. She filed her return electronically in February, opting for direct deposit so she could get her $773 refund quickly.

She’s still waiting, as are millions of others. The IRS is slowly resuming operations after pandemic-related lockdowns, but delayed refunds are devastating some people’s finances.

Tax refunds have become a lifeline

Tax refunds, which last year averaged $2,979, are the largest single infusion of cash for about 30% of U.S. families, says Fiona Greig, consumer research director at the JPMorgan Chase Institute, which researches economic issues. While many Americans use refunds to save or to pay down debt, significant numbers rely on the money to cover bills or to get needed medical care — and that was true even before COVID-19 threw millions out of work.

Delayed refunds can lead to evictions, hunger, creditor law-suits and health problems from postponed medical care, among other ill effects. Many households live so close to the edge that they can experience hardship when a refund is delayed by two or three weeks, let alone several months, says John Thompson, chief program officer for the Financial Health Network, which research-es financial challenges facing low- and moderate-income households.

“Not everybody has got the kind of flexibility or resilience to just be able to hold on,” Thomp-son says.

Most IRS operations shuttered by the pandemic

The IRS started shutting down tax return processing centers in March, along with its taxpayer help line, local offices and volunteer assistance pro-grams. Soon after, it focused on sending out more than 159 mil-lion payments as authorized by the coronavirus relief package. By mid-May, the agency faced a backlog of 10 million pieces of unopened mail, including paper tax returns.

People who filed electroni-cally generally got their refunds unless those returns were flagged, commonly because of identity theft concerns or a mismatch between the infor-mation on the return and what was provided by employers or financial institutions.

In Short’s case, the Turbo-Tax software she used counted a $3,800 annual pension payment twice, as both 1099 income and as W-2 income. The IRS sent her a letter about the error and advised her not to contact the agency for 60 days while the issue was resolved. Then, the lockdowns happened.

Short says her pension and monthly Social Security disability checks don’t cover her expenses. She makes arrange-ments to pay overdue bills, such

as her power bill, when her refund arrives. Otherwise, she says, the math of living on a low fixed income gets grim.

“Either you miss a payment on the electric bill, or you don’t get your medicine,” says Short, a former facilities manager and insulin-dependent diabetic who was severely injured when her car was hit by a drunken driver.

Using refunds to catch upPutting off bills, then using tax

refunds to catch up, is a com-mon practice among strapped households, Thompson says. A survey of people who used free filing methods for lower- and moderate-income taxpayers last year found roughly half said they needed their refunds for bills, rent, groceries and other everyday expenses, according to Prosperity Now, a nonprofit that promotes financial security.

People also increase their health care spending significantly after refund checks arrive. A 2018 study of 1.2 million checking ac-count holders found health care spending rose 60% in the week after people received refunds, indicating many were catching up on care, Greig says.

It’s not clear how long it will take the IRS to address the back-log or when taxpayers can expect their money. People can try using the “Where’s My Refund?” tool on the IRS site or call the taxpay-er help line, but getting through to a human is difficult even in normal times. Congress has cut the IRS’ budget by 20% since 2010, leading to a 22% reduction in staff, according to acting Na-tional Taxpayer Advocate Bridget Roberts. Without adequate staff, the agency answered less than one-third of its calls last year. Another option is to contact the Taxpayer Advocate Service, which has representatives in each state.

Rather than wait for the IRS to return their money each year, taxpayers can adjust their withholding so they get more money in their paychecks. But many don’t feel comfortable changing their withholding in case they wind up owing big sums, Thompson says.

“You’d have to predict how the year is going to go,” Thompson says. “And what could we possibly predict about this year?”

This column was provided to The Associated Press by the per-sonal finance website NerdWallet.

LIZ WESTON is a columnist at NerdWallet, a certified finan-cial planner and author of “Your Credit Score.” Email: lweston@nerdwallet.com. Twitter: @lizweston.

Some taxpayers face long wait for refunds

By David KoenigAP Airlines Writer

DALLAS — American Air-lines and four smaller carriers have reached agreement with the government for billions more in federal loans, a sign of the industry’s desperate fight to survive a downturn in air travel caused by the virus pandemic.

The Treasury Department said Thursday that it had signed letters of intent for new loans to American, Spirit Airlines, Fron-tier Airlines, Hawaiian Airlines

and SkyWest Airlines.All the leading U.S. airlines

had previously accepted a com-bination of grants and loans to help cover payroll costs through Sept. 30. These five are the first carriers to accept loans from a separate $25 billion kitty that Congress set aside under a $2.2 billion measure to help compa-nies hurt by the pandemic.

American Airlines said it signed a term sheet with Treasury for a $4.75 billion loan, which would be in addition to $5.8 bil-

lion that Treasury has already agreed to extend to American.

“We have to complete some legal work to reach a definitive credit agreement, but we expect to finalize that loan during the third quarter,” American CEO Doug Parker and President Robert Isom said in a note to employees. They said the addi-tional loan would give American liquidity of about $15 billion.

American is generally con-sidered the financially weakest of the largest U.S. airlines, hav-

ing entered the pandemic with the largest amount of debt. Isom said in May that the airline was considering using its AAdvan-tage frequent-flyer program as collateral for a federal loan.

Details about terms of the new loans for American and oth-ers were not immediately clear. The Treasury Department said it would post documentation with-in 72 hours of the agreements becoming final — which, judg-ing from American’s comments, could be weeks from now.

Airlines reach loan agreements with US

By Olivia RockemanBloomberg

Some 2020 graduates are finding jobs, even in this econo-my. Luck plays a role, sure, but so does a willingness to compromise.

Halle Steinberg said she wasn’t surprised when Delta Air Lines Inc. rescinded a job offer just two days before she graduat-ed with a degree in business an-alytics from Emory University’s Goizueta Business School in At-lanta. Undaunted, she applied for a data analytics position at Home Depot Inc. and got the job.

Maybe not as glamorous — the 25-year-old had been looking forward to the travel perks that come with work-ing for an airline — but it was a smart pivot. Millions have been locked down for months during the COVID-19 pandem-ic, and many are sprucing up their homes instead of spending money on flights for vacations or family visits.

Identifying such shifts may be key for new graduates look-

ing to survive in a market where more than 19.5 million Ameri-cans are unemployed, and many companies have stopped hiring or even shut down altogether. Entry-level openings were down 39% since last year as of June 15, with the biggest declines in travel and tourism, information technology and marketing and advertising, according to data from Glassdoor Inc.

“My class is only 44 students, and a little over half have a job,” Steinberg said. “A lot are strug-gling. By this time, usually ev-eryone has a job.”

Still, there are spots in indus-tries, sexy or not, that have been thrust into the spotlight during the pandemic: e-commerce, transportation and logistics, manufacturing, and health care, according to Amanda Stansell, a senior research analyst at Glass-door.

Alex Yom never imagined he would work in health care, but he feels grateful to have found a position at the Cancer Treatment Centers of America after a job of-fer from Uber Technologies Inc. was rescinded in May. Since the pandemic started, Uber has cut nearly 25% of its workforce.

“We were just coming off one

of the greatest expansions in the U.S. economy, so we were com-ing in with a lot of confidence,” Yom said of his classmates at the University of Notre Dame. “To have that kind of ripped away, I think, created anxiety for a lot of people, including myself.”

Yom spent a month reach-ing out to his contacts in search of a new position. Eventually a classmate connected him to an open role as a management fellow at the CTCA. He’s living with his parents in Indianapolis, Indiana, until his new job’s office opens in Chicago.

It’s difficult to say exactly how bad things are compared with previous years, but some schools have a rough sense of what their students are up against. At Car-leton College in Minnesota, just 25% of graduated seniors have secured employment so far, and summer internships are down 30% since last year, said RJ Holmes-Leopold, the director of the college’s career center.

In some sense, recent gradu-ates have an advantage. Without kids or a mortgage tying them to a certain city, they might be able to change plans and set out to another place. Many have moved back home with their parents.

That’s what Nika Chugh, a Drexel University graduate, did when her plan to work at a Chicago marketing company fell through after the firm froze hiring.

She now plans to move to Se-attle after getting a job in Ama-zon.com’s retail division, helping businesses that sell on Amazon with practically everything — supply chain issues, pricing or even her original specialty, mar-keting.

Those willing to keep an open mind and look beyond roles di-rectly related to their major are likely to be the most successful, Stansell said via email.

“What’s more important now than ever is a disciplined job search routine, thorough re-search and flawless application materials that will help first-time job seekers stand out,” Stansell said. “If a dream job or compa-ny isn’t hiring now, look for roles with related skills and experienc-es that you can still learn.”

Holmes-Leopold of Car-leton said the situation could get worse. “Our new graduates will end up competing against job seekers who were initially furloughed and then lost their employment,” he said.

Nice work, if you can get itWhere the class of 2020 is finding job opportunities

David Maialetti/AP file photo

University of Pennsylvania graduates Anna Alvarado, Maggie Danaher, Ketaki Gujar and Megan Spitzer watch their virtual graduation ceremony as they sit on campus in Philadelphia on May 18. Some 2020 graduates are finding work by identify-ing shifts in the job market.