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A ‘Rising Tide’ Lifts Women

There’s an old saying: A rising tide lifts all boats. Applied to the economy, this means that general improvements could benefit all participants within the economy. The same appears to be true for women.1

As the U.S. economy continues to grow, there is an influx of money available for small business startups. This is great news for female entrepreneurs struggling to find startup capital.2

The rollback of certain provisions of the Dodd-Frank Act has given many community banks and credit unions the latitude to lend more to local business owners, and the Small Business Administration is noting more loans.3 While men appear to still have greater access to funds from traditional lenders than women, the gap is finally narrowing (34 percent versus 31 percent).4

We hope that each of our clients has been able to take advantage of the strong economy, job market and real estate opportunities driven by today’s rising tide. Higher income and assets can help us raise our standard of living as well as provide a more secure financial future. If you need assistance determining ways to help protect your retirement income from being at risk during changing tides, call us to discuss strategies for securing your retirement income for the future.

Interestingly, women also are taking advantage of some of the political changes taking place today. Many see our current president as more of a businessman than a politician, allowing the field to open for a wide variety of people to run for office. A past survey revealed women who felt unqualified to run for office were less likely to “go for it” than men who believed the same. However, today’s political arena has presented a rising tide: 529 women are running for national congressional offices in the midterm elections; 78 are running for governor.5

Recent issues — such as gender income equality, increased demand for diversity and workplace harassment — have raised not just the tide, but also raised the bar for appropriate treatment of women. According to one legal consulting firm, the current landscape has created a positive environment for female lawyers to negotiate pay raises on par with their male peers.6

In many ways, the past year’s trials and tribulations have generated a new movement, leading some media outlets to label 2018 as the “Year of the Woman.” As more women are engaged in the workforce, not only have productivity and profits increased, but we’ve seen increased overall skill levels and an entirely new platform of complementary skills. Perhaps most significantly though, the rising tide of women in the workforce has raised overall wages — even for men.7

Content prepared by Kara Stefan Communications.

1 Kimberly Weisul. Inc. May 30, 2018. “7 Signs That the Investment Landscape for Women Is Finally Changing.” https://www.inc.com/kimberly-weisul/seven-signs-that-women-entrepreneurs-are-about-to-rake-in-the-dough.html?cid=sf01001. Accessed July 10, 2018.

2 Ibid.

3 Rieva Lesonsky. Small Business Trends. July 2, 2018. “Exclusive Interview: SBA Administrator Linda McMahon Says Small Business Options Improving.” https://smallbiztrends.com/2018/07/linda-mcmahon-is-optimistic-small-business.html. Accessed July 10, 2018.

4 Annie Pilon. Small Business Trends. June 18, 2018. “20 Amazing Stats on Women Entrepreneurs from SCORE.” https://smallbiztrends.com/2018/06/women-entrepreneurs-statistics.html. Accessed July 10, 2018.

5 Margaret Talbot. The New Yorker. April 18, 2018. “The women running in the midterms during the Trump era.” https://www.newyorker.com/news/news-desk/2018-midterm-elections-women-candidates-trump. Accessed July 10, 2018.

6 Miriam Rozen. The American Lawyer. June 12, 2018. “Seasoned Women Lawyers Gaining Leverage in Salary Talks.” https://www.law.com/americanlawyer/2018/06/12/you-go-girl-seasoned-women-lawyers-gain-leverage-in-salary-talks/?slreturn=20180610192104. Accessed July 10, 2018.

7 Amanda Weinstein. Harvard Business Review. Jan. 31, 2018. “When More Women Join the Workforce, Wages Rise — Including for Men.” https://hbr.org/2018/01/when-more-women-join-the-workforce-wages-rise-including-for-men. Accessed July 10, 2018.

Neither our firm nor its agents or representatives may give tax advice. Individuals should consult with a qualified professional for guidance before making any purchasing decisions. 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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All About Bots

Even if you aren’t familiar with bots, you’ve likely come into contact with many of these forms of artificial intelligence, or AI. Bots are applications that perform automated tasks such as setting alarms, relaying weather forecasts or conducting online search for travel deals. Many smart phones come equipped with personal-service bots, such as the iPhone’s Siri.1

AI is ramping up in a number of ways that affect consumers’ lives — even when we don’t realize it. For example, Amazon uses AI for automated shopping suggestions and Bank of America utilizes online customer service chatbots.2

There are many areas in which a bot can either deploy specific instructions or assess historical data and make recommendations. However, there are still areas in our lives that can benefit from being handled by human interaction, such as financial decisions. We believe it’s important to work with a trusted and experienced financial professional who can offer guidance tailored to your circumstances.

For example, there’s more to buying an insurance contract than just knowing your age and expected lifespan. Many factors — such as leaving money to your loved ones, retirement income needs and goals for the future — come into play. If you are looking for some human interaction to help you assess your retirement income needs, give us a call.

As for bots, there’s a lot of chatter online and in the news about their misuse in how they spread misinformation and influence the way people think and consequently act. For example, the social media website Twitter is reported to have a preponderance of bots used as fake accounts to generate acrimony among users. According to one report, bot accounts make up 9 to 15 percent of all Twitter users. The company deletes these accounts once they are identified and has increased measures to prevent bots from signing up to the tune of around 50,000 new bot accounts a day.3

Over at Facebook, they are combating the bot-manipulated spread of fake news by using their own automated systems. Unfortunately, there are a few flaws with using AI to combat AI. For example, in the days leading up to the Fourth of July, the newspaper in a small Texas town posted a series of passages from the U.S. Declaration of Independence on its Facebook page.4

One post that cited potentially offensive-sounding language (“He is at this time transporting large Armies of foreign Mercenaries to compleat the works of death, desolation and tyranny, already begun with circumstances of Cruelty & perfidy scarcely paralleled in the most barbarous ages, and totally unworthy the Head of a civilized nation”) was identified as hate speech and thereby removed by Facebook bots. Eventually the mistake was rectified with an apology from Facebook.5

An interesting twist in the bot phenomenon is some companies want their users to believe they’ve developed the latest bot technology, but in reality, they’ve determined it’s cheaper to hire humans to do the work rather than invest in AI capabilities. In effect, they’ve hired humans to imitate bot technology instead of the other way around. For example, a couple of startup firms that feature calendar-scheduling services actually employ humans to pretend to be chatbots for this mind-numbing task. Some of the workers were so bored by the task they reported looking forward to being replaced by actual bots.6

Content prepared by Kara Stefan Communications.

1 Sarah Mitroff. CNET. May 5, 2016. “What is a bot? Here’s everything you need to know.” https://www.cnet.com/how-to/what-is-a-bot/. Accessed July 8, 2018.

2 Ben Dickson. TheNextWeb.com. July 5, 2018. “7 surprising companies where you can work on cutting-edge AI technology.” https://thenextweb.com/artificial-intelligence/2018/07/05/companies-work-ai-technology/. Accessed July 8, 2018.

3 Maya Kosoff. Vanity Fair. June 27, 2018. “Can Twitter Purge Its Bots Without Killing Its Bottom Line?” https://www.vanityfair.com/news/2018/06/can-jack-dorsey-twitter-purge-bots-without-killing-bottom-line. Accessed July 8, 2018.

4 Simon Sharwood. The Register. July 5, 2018. “US Declaration of Independence labeled hate speech by Facebook bots.” https://www.theregister.co.uk/2018/07/05/us_declaration_of_independence_labeled_hate_speech_by_facebook_bots/. Accessed July 8, 2018.

5 Ibid.

6 Olivia Solon. The Guardian. July 6, 2018. “The rise of ‘pseudo-AI’: how tech firms quietly use humans to do bots’ work.” https://www.theguardian.com/technology/2018/jul/06/artificial-intelligence-ai-humans-bots-tech-companies. Accessed July 8, 2018.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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The Future of Transportation

China appears to be leading the charge in the future of transportation infrastructure — but it’s happening today. The government has constructed a test section of solar-panel comprised road, mapping sensors and electric-battery rechargers to create an “intelligent highway.” The design enables on-the-go recharging of electric-vehicle batteries as well for traffic updates and accurate mapping. Additionally, the embedded solar panels will be able to generate enough electricity to power highway lights and 800 homes.1

We tend to become embroiled in our day-to-day existence and forget there’s a whole world focused on innovating ways to make our lives easier. Thirty years ago, we never would have considered the convenience of carrying a mobile phone everywhere we go; too often we stayed at home so we wouldn’t miss an important phone call.

When considering innovation — whether cars, phones or computing technology — it’s worth asking how we can incorporate these advances into our lifestyles. For example, taking advantage of rear-camera systems in cars when backing out of the driveway or checking an online account to see whether we paid a bill are both particularly useful features as we get older. These innovations in technology have helped people feel more confident in their day-to-day tasks. As financial professionals, we are here to help you create a retirement income strategy through the use of insurance products that you can feel confident about.

In the U.S., a Missouri-based technology venture, Integrated Roadways, is working on its own version of “smart pavement.” This pavement system embeds a sensor, data and connectivity network designed to improve roadway safety and provide Wi-Fi in vehicles.2

In 2013, Elon Musk first proposed the idea of high-speed travel through vacuum tubes — kind of like a turbo-charged super train made safer by being completely surrounded by guardrails. The idea is being tested by several different entities, including a 19-passenger prototype developed in Dubai with speeds up to 700 mph. While the prototype looks like a small, sleek and upscale airliner, it does leave a bit to be desired — like windows (not functional when traveling encased in a tube). The trade-off, however, for this particular model is the ability to travel an 87-mile route in about 12 minutes — a trip that normally takes about 90 minutes by car.3

In the U.S., 76 percent of commuters drive to work alone, but ride-hailing and ride-sharing resources (such as Uber) are on the rise. However, these services have led to declining use of light-rail mass transit resources. This poses a conundrum, since more cars on the road continues to strain our reliance on gas, road and highway infrastructure rehabilitation and traffic congestion.4

In the Netherlands, the government is piloting ways to encourage more sustainable modes of transportation. Already a bicycle-friendly country, employers are driving an initiative to offer tax-advantaged pay incentives for workers who cycle instead of drive to work. This not only helps reduce reliance on foreign oil, but further eliminates traffic congestion. Employers and workers also benefit by not having to pay for parking. The health benefits can be substantial as well.5

Content prepared by Kara Stefan Communications.

1 Bloomberg. April 11, 2018. “China’s Built a Road So Smart It Will Be Able to Charge Your Car.” https://www.bloomberg.com/news/features/2018-04-11/the-solar-highway-that-can-recharge-electric-cars-on-the-move. Accessed June 30, 2018.

2 Robert A. Cronkleton. Kansas City Star. May 21, 2018. “Wi-Fi in the road? Kansas City tech start-up is wiring pavement for safety — and fun.” https://www.kansascity.com/news/business/article210853514.html. Accessed June 30, 2018.

3 David Freeman. NBC News. May 20, 2018. “New hyperloop photos show capsule’s sleek, windowless interior.” https://www.nbcnews.com/mach/science/new-hyperloop-photos-show-capsule-s-sleek-windowless-interior-ncna875266. Accessed June 30, 2018.

4 Leonid Bershidsky. Bloomberg. July 1, 2018. “Innovation Can’t Fix Urban Transportation’s Woes.” https://www.bloomberg.com/view/articles/2018-07-01/ride-sharing-and-other-services-can-worsen-urban-transportation. Accessed July 1, 2018.

5 Harry Cockburn. Independent. June 20, 2018. “Netherlands considering paying people to cycle to work in effort to cut road congestion.” https://www.independent.co.uk/news/world/europe/netherlands-cycling-pay-use-bicycle-road-congestion-dutch-companies-a8408146.html. Accessed June 30, 2018.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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Food for Health

We love our bacon. In recent years, this pork delicacy has seen a resurgence in popularity alongside new ways to enhance recipes ranging from bacon-infused macaroni and cheese1 to the not-quite traditional bacon-wrapped holiday turkey.2

But just because something is popular doesn’t mean it’s good for you. According to the World Cancer Research Fund, one way to help reduce your risk of developing cancer is to omit processed meats from your diet. This includes bacon, salami, hot dogs and some sausages, all of which have been linked to an increased risk for colorectal cancer. While beef, pork and lamb also may contribute to cancer risk, the correlation isn’t quite as strong.3

It seems as if studies emerge every day recommending what we should and shouldn’t eat to improve our health. While researchers can draw reasonable guidelines, the reality is we’re all different; our various lifestyle choices, bodies and genetic makeup result in individual health outcomes, longevity and quality of life. Because of this, it’s a good idea to consider life insurance and to also plan for potential long-term care costs, for ourselves and to help protect our loved ones’ financial future. Please give us a call if you’d like to discuss your insurance options.

Now’s the time to focus on lifestyle choices to help promote a long and healthy life. For example, eggs had a bad reputation for many years. But recent studies show that eating eggs in moderation — approximately one a day — is believed to reduce the risk of diabetes without driving up serum cholesterol levels.Naturally, it’s best to omit any accompanying ham or bacon.4

Instead of potato chips or other crunchy, salty snacks, choose a handful of pecans, which may improve insulin levels to help reduce the risk of heart disease, particularly in people who are overweight or obese. Also, mushrooms are shown to reduce excess inflammation linked to health ailments such as thyroid and heart conditions.5

Good news for coffee drinkers: A recent study found strong correlations from caffeine and coffee to a lower risk for heart disease, type 2 diabetes, breast, colorectal, colon endometrial and prostate cancers.6

Those trying to lose weight may avoid carbohydrates. In doing so, many people increase their intake of protein-laden foods. However, be careful with this approach, as the types of foods you eat may be more of a key factor. For example, one study found that those eating a diet high in meat-based protein had a 60 percent increase in cardiovascular disease. Meanwhile, those getting their protein largely from nuts and seeds actually reduced their risk for cardiovascular disease by 40 percent.7

 

Content prepared by Kara Stefan Communications.

1 Tess Koman. Delish.com. June 6, 2018. “Move Your Cheese-Loving Butt: Panera Just Rolled Out A Bacon Mac And Cheese.” https://www.delish.com/food-news/a21087421/panera-bacon-mac-and-cheese/. Accessed June 25, 2018.

2 Indiana Nash. The Daily Gazette. Nov. 19, 2017. “8 alternative ways to prepare your Thanksgiving turkey.” https://dailygazette.com/article/2017/11/19/8-alternative-ways-to-prepare-your-thanksgiving-turkey. Accessed June 25, 2018.

3 Jamie Ducharme. Time. May 26, 2018. “Cancer Group Recommends Ditching Bacon and Booze to Stay Cancer-Free.” http://time.com/5292566/world-cancer-research-fund-report/. Accessed June 25, 2018.

4 Kathleen Doheny. EndocrineWeb.com. June 16, 2018. “Heart Healthy Diet to Improve Cardiovascular Health, Lower Diabetes Risk.” https://www.endocrineweb.com/news/diabetes/59709-heart-healthy-diet-improve-cardiovascular-health-lower-diabetes-risk. Accessed June 25, 2018.

5 Ibid.

6 Kashmira Gander. Newsweek. June 22, 2018. “Drinking this much coffee can help keep your heart healthy, study suggests.” http://www.newsweek.com/amount-coffee-which-could-protect-heart-revealed-study-990660. Accessed June 25, 2018.

7 Sarah Angle. Healthline. June 14, 2018. “Think Your High-Protein Diet Is Healthy? It May Be Hurting Your Heart.” https://www.healthline.com/health-news/high-protein-diet-hurting-your-heart#1. Accessed June 25, 2018.

 

Guarantees and protections provided by insurance products are backed by the financial strength and claims-paying ability of the issuing insurer.

 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

 

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Job Trends

For decades, young people were told college was the surest route to financial success as an adult. Get a degree, get a good job.

However, this formula seems to be broken. During the recession, jobs for recent college graduates were scarce, causing many to continue their higher education and sink deeper into student loan debt. With minimal wage hikes for some white-collar professions, not all college degrees are paying for themselves. In many cases, they can even be a liability.1

On the other hand, skilled trade industries continue to elevate their wages due to a shortage of available workers. Today’s high school graduates may find well-paying jobs with benefits right off the bat, particularly if they have motivation and well-rounded resumes. Perhaps most importantly, they must be willing to work hard and learn a new skill. These workers may not earn as much as a college graduate throughout their lifespan, but there’s also nothing stopping them from going to college later.2

The employment market continues to change, behooving job seekers to be more flexible with goals and expectations. For example, the construction and health/personal-care industries are expected to account for a third of all new jobs through 2022.3

Some cities in lesser-populated areas of the country are actively recruiting people to relocate and fill jobs in specialized labor industries. The city of Hamilton, Ohio, offers a $5,000 moving bonus to help pay student loans, while Grant County, Indiana, offers $5,000 toward buying a home.4

The trend is also positive for older workers. A new survey revealed 77 percent of employers believe workers age 50 and up as are more engaged in their job and offer greater experience and range of skills than their younger counterparts.5

The growing demand for older workers may be an important factor in your retirement planning. It may not be necessary to fully fund your nest egg and then retire “cold turkey.” Instead, many employers are starting to understand the value of flexible employment, both from an overhead cost to a productivity perspective. Therefore, older workers may be able to negotiate lower pay to supplement retirement income — delaying full retirement — via flexible work arrangements or contract employment.6

Some older people have also taken advantage of new community and online classes teaching coding and computer programming skills. Some are developing new skills to start second careers or use in volunteer opportunities. Learning a new hobby, such as making personalized electronic cards for family members, can help aging brains stay sharp.7

If you’d like help reviewing your retirement income strategy and discussing ways to incorporate earned income, please don’t hesitate to give us a call.


Content prepared by Kara Stefan Communications.

1 Kavya Vaghul. The Washington Center for Equitable Growth. “The student loan crisis is fueled by a weak labor market.” https://equitablegrowth.org/the-student-loan-crisis-is-fueled-by-a-weak-labor-market/. Accessed June 16, 2018.

2  Jon Marcus. The Hechinger Report. April 23, 2018. “High-paying jobs go begging while high school grads line up for bachelor’s degrees.” http://hechingerreport.org/high-paying-jobs-go-begging-while-high-school-grads-line-up-for-bachelors-degrees/. Accessed June 16, 2018.

3 Ibid.

4 David Harrison and Shayndi Raice. The Wall Street Journal. April 30, 2018. ” How Bad Is the Labor Shortage? Cities Will Pay You to Move There.” https://www.wsj.com/articles/how-bad-is-the-labor-shortage-cities-will-pay-you-to-move-there-1525102030. Accessed June 16, 2018.

5 Joanna Hughes. The Job Network. “Hiring Trends Show Older Workers in Demand.” https://www.thejobnetwork.com/hiring-trends-show-older-workers-in-demand/. Accessed June 16, 2018.

6 Eric Titner. The Job Network. “Trends that older workers need to watch for in 2018.” https://www.thejobnetwork.com/trends-that-older-workers-need-to-watch-for-in-2018/. Accessed June 16, 2018.

7 Vivian Marino. The New York Times. Sep. 22, 2017. “Some People Learn to Code in Their 60s, 70s or 80s.” https://www.nytimes.com/2017/09/22/your-money/some-people-learn-to-code-in-their-60s-70s-or-80s.html?utm_sq=fs1lzdnev7. Accessed June 16, 2018.

 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

 

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Long-Term Care Update

Long-term care continues to be a challenging issue in the U.S. It appears the second wave of baby boomers is even more determined to “age at home,” while at the same time, they are more likely to suffer from multiple chronic conditions, such as heart disease and diabetes.1 This confluence of factors makes it all the more difficult to come up with solutions for long-term care.

To complicate matters, insurers that offer long-term care (LTC) insurance have become more particular about offering coverage. According to the American Association for Long-Term Care Insurance, more people are being denied coverage across the spectrum of age brackets. The following shows the percentage of applicants declined coverage in 2017:2

  • Below age 50: 20%
  • 50- to 59-year-olds: 22%
  • 60- to 69-year-olds: 30%
  • 70- to 79-year-olds: 44%

Not only have sales of traditional LTC policies decreased over the last 17 years (currently one-tenth of the sales in 2000), but there are now far fewer insurers in the marketplace.3

Although we often spend a lot of time on planning for retirement, we don’t always devote substantial time and resources to how to pay for potential long-term care expenses. We should. Like it or not, long-term care is expensive and likely to take up a large portion of our household budgets later in life. Some insurance products such as life insurance and annuities provide various options you may want to consider. We’d be happy to discuss your options based on your unique situation.

People are living longer but continue to develop health conditions that require caregiving as they age. As a result, LTC premiums continue to rise. However, traditional LTC premiums are considered a medical expense. For an individual who itemizes tax deductions, medical expenses can be deductible if certain qualifications are met. The amount of LTC insurance premiums that can be treated as a medical expense is subject to limitations based on the insured’s age.4

Also consider activating a chronic illness or long-term care rider that may be attached to your term life or permanent life insurance policy, as these riders can assist with the costs of long-term care should the need arise. Note that the ability to use this option is subject to specific contract terms. Also, benefits are generally treated as accelerated death benefits, which will reduce the overall death benefit of your life insurance policy.

Pets have LTC needs, too

One of the greatest comforts for seniors who find themselves more and more homebound is the company of a pet. As such, it’s important to consider the long-term care needs of your pets as they grow older as well. Dogs are considered geriatric at age 10, but a vet may start talking about senior care around age seven, particularly for large-breed dogs. These changes may involve nutrition, dental care and exercise needs and even running lab work to check for potential age-related problems.5

While outdoor cats are subject to environmental hazards that cannot be controlled by a vet, indoor cats generally have longer lifespans. Felines are considered to be entering old age at about 9 years old, with the average lifespan from 12 to 18 years. In fact, trends in veterinary medicine are attributed to longer lifespans in cats these days.6

Unfortunately, the older we get, the more difficult it is to get to regular checkups for ourselves, let alone our pets. One vet facility in the Tampa Bay-area of Florida offers a mobile clinic that brings veterinarian services to pet-owning seniors, whether living at home or in an assisted living facility.7

Also, remember to keep your pets in mind when you write or update your will. It’s important to have conversations with family and friends to help ensure that your pets will have a loving home should you pass away before them.

 

Content prepared by Kara Stefan Communications.

1 Susannah Luthi. Modern Healthcare. June 5, 2018. “Azar touts new SNF pay model for making long-term care sustainable.” http://www.modernhealthcare.com/article/20180605/NEWS/180609963. Accessed June 9, 2018.

2 American Association for Long-Term Care Insurance. May 10, 2018. “It’s Harder To Health Qualify For Long-Term Care Insurance, Start Earlier.” http://www.aaltci.org/news/long-term-care-insurance-association-news/its-harder-to-health-qualify-for-long-term-care-insurance-start-earlier. Accessed June 15, 2018.

3 Greg Iacurci. Investment News. May 11, 2018. “Insurers becoming more stringent with long-term-care policies.” http://www.investmentnews.com/article/20180511/FREE/180519978/insurers-becoming-more-stringent-with-long-term-care-policies. Accessed June 10, 2018.

4 American Association for Long-Term Care Insurance. “Long-Term Care Insurance Tax-Deductibility Rules – LTC Tax Rules.” http://www.aaltci.org/long-term-care-insurance/learning-center/tax-for-business.php. Accessed June 15, 2018.

5 Joey Turner. Globalanimal.org. June 6, 2018. “Tail-wagging tips on caring for older pets.” https://www.globalanimal.org/2018/06/06/how-to-care-for-older-pets/44957/. Accessed June 10, 2018.

6 Ibid.

7 Kelly Ring. Fox News 13. June 5, 2018. “Mobile service brings veterinary care to senior pet owners.” http://www.fox13news.com/news/what-s-right-with-tampa-bay/mobile-service-brings-veterinary-car-to-senior-pet-owners. Accessed June 9, 2018.

Neither our firm nor its agents or representatives may give tax advice. Individuals should consult with a qualified professional for guidance before making any purchasing decisions. 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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Various Types of “Economies”

As recently as five years ago, few people had heard of emerging businesses like Airbnb and Uber that allow proprietors to share their personal residences and cars to generate income. This business model is now commonly referred to as the “sharing economy.” 1

However, just as capitalism morphs, so does the concept of sharing. For example, some Uber drivers actually lease an upscale car to charge higher fares that compete with luxury driving services.2

The Great Recession played a hand in encouraging unemployed workers to find innovative sources of income when jobs were scarce, and the sharing economy has been seen as influential in our overall economy’s recovery. It’s worth considering how we can better prepare ourselves for potential economic declines via job innovation, vigilant savings habits and protecting a portion of our retirement assets through guaranteed insurance products. If you’d like help devising a strategy using a variety of insurance products to help you work toward your long-term retirement income goals, please call us to schedule a meeting.

In addition to the sharing economy, today’s world is home to a wide array of economic varieties, including:

Sharing Economy

As mentioned, this model focuses on sharing or renting under-utilized assets. One of the primary concerns with this model is trusting others to take care of your personal assets. Some proprietors require an upfront deposit to help defray the cost of breakage or stolen goods. Insurance companies also have gotten into this business by developing policies for reimbursement.3

On-Demand Economy

This model focuses on providing goods and services on an as-needed basis. For example, in situations where a short-term rental is cheaper than buying — such as owning a car in a large metropolitan city — it can be more cost effective and convenient to use Uber transportation rather than own a car. This is true in expensive cities including New York City, Chicago, Los Angeles, and others, particularly when including expenses like gas and insurance. 4

Peer Economy

This economic model is based on the creation of products, delivery of services, funding and more by peer-to-peer (P2P) networks. These peer-lending platforms can help bolster economic progress, particularly in a rising interest-rate environment. For example, a small business seeking capital may be able to use an online P2P lending platform that matches borrowers to lenders. This can help a business owner acquire a less expensive loan more quickly than through a traditional financial institution.5

Crowd Economy

The crowd economy enlists the larger population or a subset to generate funding, information, resources and more. This particularly interesting phenomenon has infinite applications. For example, the city of Akron, Ohio, is providing CPR training to the general public in hopes that crowd-sourcing certain emergency service skills will lead to more victims getting immediate help until paramedics arrive.6 Crowd-sourcing also is a good way to find undiscovered talent. Instead of hiring an advertising agency to produce promotional artwork for an annual film festival, the organizers may hold an open competition for the public, tapping local artists whose talent may otherwise go unnoticed.7

Statistics indicate that the sharing economy and its various iterations are producing big revenues. A recent U.S. study found that on-demand workers generated more than $110 billion in the 15 largest metropolitan areas, including New York City, Los Angeles, Miami, Chicago, San Francisco and Washington, D.C.8

 

Content prepared by Kara Stefan Communications.

1 April Rinne. World Economic Forum. Dec. 13, 2017. “What exactly is the sharing economy?” https://www.weforum.org/agenda/2017/12/when-is-sharing-not-really-sharing/. Accessed June 2, 2018.

2 Ibid.

3 Matthew Wall. BBC News. June 1, 2018. “‘I bought my mum a flat just by renting out my camera kit.’” https://www.bbc.com/news/business-44301183. Accessed June 2, 2018.

4 Megan Rose Dickey. TechCrunch.com. May 30, 2018. “Here’s where it’s cheaper to take an Uber than to own a car.” https://techcrunch.com/2018/05/30/heres-where-its-cheaper-to-take-an-uber-than-to-own-a-car/. Accessed June 2, 2018.

5 Craig Asano and Michael King. The Globe and Mail. May 30, 2018. “Peer-to-peer lending will help small businesses stay afloat.” https://www.theglobeandmail.com/business/commentary/article-peer-to-peer-lending-will-help-small-businesses-stay-afloat/. Accessed June 2, 2018.

6 Doug Livingston. Akron Beacon Journal. May 31, 2018. “Akron is ‘crowd-sourcing’ CPR.” https://www.ohio.com/akron/news/akron-is-crowd-sourcing-cpr. Accessed June 2, 2018.

7 Michael Beiermeister. WBKB11.com. June 1, 2018. “Thunder Bay Film Society Crowdsourcing Cover Art for 2018 Sunrise 45 Film Festival.” http://www.wbkb11.com/thunder-bay-film-society-crowdsourcing-cover-art-for-2018-sunrise-45-film-festival. Accessed June 2, 2018.

8 Benjamin Mann. JD Supra. May 24, 2018. “The Gigs Get Bigger: Recent Data Shows the On-Demand Economy is Growing Into New Areas.” https://www.jdsupra.com/legalnews/the-gigs-get-bigger-recent-data-shows-85361/. Accessed June 2, 2018.

 

Guarantees and protections provided by insurance products including annuities are backed by the financial strength and claims-paying ability of the issuing insurer.

 

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

 

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Family Business Considerations

 

Family businesses that manage to survive generation after generation leave not only a family legacy, but also the potential for tremendous wealth. For example, Arkansas-based Walmart is presently the largest business in the world in terms of revenue, earning more than $485 billion in 2017. In 1992, founder Sam Walton passed away and left his retail empire in the hands of seven heirs.1

Presently, the Walton family business outranks the wealth of the Koch Industries energy group, which is the second-largest privately owned company. Next in line in terms of individual wealth of business founders are Jeff Bezos (Amazon), Bill Gates (Microsoft) and Warren Buffett (Berkshire Hathaway).2

These are just samples of the scope of wealth an entrepreneur can amass. However, most small business owners do well just to keep their heads above water. For those who would like to pass their business on to family members, there are basic business management strategies to keep in mind.3 If we can help you develop an insurance strategy to help protect your business, your key executive staff or your legacy, please give us a call.

On a day-to-day basis, successful family-owned entities generally follow some well-honed principles to keep family politics out of the business. For example, the patriarch and his four daughters who run the six-generation family-owned business D.G. Yuengling & Son Inc. have many varying opinions. To keep the business humming, they agree that it’s OK to disagree: “Diversity of opinion is what keeps family businesses strong and spurs collaboration.”4

It’s also a good idea to keep family and business separate. This means scheduling regular, in-office staff meetings so that family dinners can focus on just that — family. It’s important, too, that everyone has distinct roles and responsibilities. It’s difficult enough when duties overlap among workers, but in a family business this can lead to an all-out sibling brawl. When jobs and job titles are doled out to family members based on their natural strengths and interests, each employee can take ownership and be held accountable, as well as enjoy the pride and satisfaction for their individual contributions.5

For some families, entering the family business may take time. Even beyond a formal education, it may be important to first seek non-family job experience before “boomeranging” back to the fold. This scenario worked well for the three generations that run Cleaver Farm and Home — a building-supply distributor in Kansas. The business has managed to expand as each generation of family members took charge. For the current generation of brothers, launching their own career paths allowed them to return to their family roots and give their own children the sort of childhood they enjoyed.6

Bear in mind, too, that younger generations can bring new skill sets to the family business.

For example, a 17-year-old prodigy whose family has owned a metalworking company since the late Middle Ages has introduced technology to the fold. Anton Klingspor added exponential growth in his family’s business through various technological tools like LinkedIn Lead Builder and Facebook Workplace to improve team collaboration and communication.7

As a business grows larger and more complex, the family may need to look outside the fold for specific skills and experience. It’s important to engage knowledgeable professionals and establish formal business and family governance systems to help manage risks and enjoy a more sustainable foundation for future success.8

Content prepared by Kara Stefan Communications.

1 Lianna Brinded. Quartz. May 14, 2018. “The richest family in the world beat the Koch brothers, Bezos, Gates, and Buffett.” https://qz.com/1276872/the-richest-people-in-the-world-walton-family-koch-brothers-bill-gates-jeff-bezos-warren-buffett/. Accessed May 28, 2018.

2 Ibid.

3 Hilary Sheinbaum. Forbes. April 30, 2018. “How The 4 Yuengling Sisters Manage The Family Business.” https://www.forbes.com/sites/hilarysheinbaum/2018/04/30/how-4-sisters-manage-the-family-business-and-still-get-along-and-you-can-too/#198c9d0262ca. Accessed May 28, 2018.

4 Ibid.

5 Amy George. Inc. Jan. 17, 2018. “How to Build a Family Business That Lasts for Generations, According to Bravo TV Star Tabatha Coffey.” https://www.inc.com/amy-george/how-to-build-a-family-business-that-lasts-for-generations-according-to-bravo-tv-star-tabatha-coffey.html. Accessed May 28, 2018.

6 Raney Rapp. Farm Talk. May 15, 2018. “Cleaver Farm and Home celebrates three generations of family business.” http://www.farmtalknewspaper.com/news/cleaver-farm-and-home-celebrates-three-generations-of-family-business/article_7796c170-584b-11e8-8ed6-27bc3ee8f20b.html. Accessed May 28, 2018.

7 John White. Inc. Sept. 7, 2017. “How This 17-Year-Old Used an Entrepreneurial Mindset to Grow His Family Business to $300-Million.” https://www.inc.com/john-white/lessons-from-a-gen-zer-on-how-to-grow-a-200-year-o.html. Accessed May 28, 2018.

8 Marleen Dielemen. Forbes. May 25, 2018. “4 Types Of Family Businesses You’ll See In Asia And How To Govern Each Effectively.” https://www.forbes.com/sites/nusbusinessschool/2018/05/25/4-types-of-family-businesses-youll-see-in-asia-and-how-to-govern-each-effectively/#5147434e659f. Accessed May 28, 2018.

Guarantees and protections provided by insurance products are backed by the financial strength and claims-paying ability of the issuing insurer.

 We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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The Psychology of Economics

 

Countries with a longstanding track record of economic stability and security tend to have the happiest citizens, reports journalist Dan Buettner, who has studied what makes people happy. Education and health care are two primary reasons why, combining to create an upwardly mobile lifecycle.1

Mothers with higher education levels tend to have fewer children, and those children tend to be healthier and more productive adults, Buettner says. In turn, they often become successful parents and make more well-informed voting decisions. This enables the next generation to make even higher social and economic gains.2

With this in mind, it’s worth considering how we can make education and health care more affordable within our own households. College tuition is expected to continue experiencing higher inflation levels than most other household expenses.3 Health insurance and medical inflation is expected to outpace overall economic inflation this year for the first time since 2010.4 If you’re looking for ways to help prepare for future health care and higher education costs for you and your loved ones, please set up a time to visit with us.

Another interesting, emerging economic trend is that of human workers versus automation. While we can debate the merits of cost savings versus human judgment, there’s an underlying theory that technology is not necessarily the key to future economic growth. In fact, in a departure from encouraging more students to study the STEM disciplines (science, technology, engineering and math), there’s a new movement to better understand the drivers of human behavior and how we might interact with technology in the future.5

If you look at recent trends in consumer-driven technology, there is a discernible shift away from high-tech products and services. For example, independent bookstores and print books are experiencing a revival after years of competing with the rising popularity of online bookstores and eReaders.6 And, remarkably, instant-print cameras have become fashionable again and experienced a 30 percent growth in sales in 2017.7

Content prepared by Kara Stefan Communications.

1 Knowledge@Wharton. March 2, 2018. “What Can We Learn from the World’s Happiest People?” http://knowledge.wharton.upenn.edu/article/blue-zones-happiness/. Accessed May 18, 2018.

2 Ibid.

3 Venessa Wong. CNBC. March 17, 2017. “In 18 years, a college degree could cost about $500,000.” https://www.cnbc.com/2017/03/17/in-18-years-a-college-degree-could-cost-about-500000.html. Accessed June 7, 2018.

4 Fortune. Feb. 15, 2018. “Healthcare Prices to Outpace Inflation for the First Time Since 2010.http://fortune.com/2018/02/15/healthcare-prices/. Accessed May 18, 2018.

5 Shon Burton. MarketWatch. May 31, 2018. “Opinion: Coding skills won’t save your job – but the humanities will.” https://www.marketwatch.com/story/coding-skills-wont-save-your-job-but-the-humanities-will-2018-05-17. Accessed May 18, 2018.

6 Alex Preston. The Guardian. May 14, 2018. “How real books have trumped ebooks.” https://www.theguardian.com/books/2017/may/14/how-real-books-trumped-ebooks-publishing-revival. Accessed June 4, 2018.

7 Chaim Pikarski. Twice. Feb. 20, 2018. “What’s driving the instant photo revival?” https://www.twice.com/blog/whats-driving-instant-print-photo-revival. Accessed May 18, 2018.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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For Some Retirees, Home is Where the Debt is

Today’s pre-retirees and retirees tend to have far more debt than those in years past. In addition to factors like credit card payments and medical expenses, this generation is seeing the effects of higher home prices and easily obtained low down-payment mortgages in the early 2000s.1

Between 2003 and 2016, Americans 60 and older nearly tripled their household debt — composed of mortgages, home equity loans, auto loans, student loans and credit cards.2 According to the Employee Benefit Research Institute, households headed by a person age 75 or older held an average debt load of $36,757 in 2016.3

If you’re still carrying a fair amount of debt and nearing retirement, we can help you review your household budget to help plan for a more confident retirement. Please give us a call if you’d like to schedule a meeting.

One of the challenges in the new tax law is the interest-cap deduction on mortgage loan payments, meaning homeowners with high mortgage balances may be required under the new law to deduct less mortgage interest. The mortgage limit on new homes purchased is $750,000, while the limit on mortgages purchased before Dec. 15, 2017, remains $1 million.These numbers are important if downsizing is part of your debt-reduction strategy.4

Another major contributor to debt is the rising cost of sending children to college. Of the 3.5 million Americans who owe an average of $24,000 in Parent PLUS student loan debt, about half of them are parents older than age 50. Worse yet, the number of parents with student loans is rising at a faster rate than students.5 Unfortunately, all those debt payments could be used to save for retirement.

The No. 1 reason individuals file for bankruptcy is medical debt.6 Whether nearing retirement or already there, unexpected health care costs can seriously curtail retirement funds. It’s a good idea to work with a financial professional to develop a strategy for paying potential health care costs down the road.

 

Content created by Kara Stefan Communications.

1 Rebecca Moore. PlanAdvisor. Jan. 10, 2018. “Debt Causing Financial Vulnerability for Pre-Retirees.” https://www.planadviser.com/debt-causing-financial-vulnerability-pre-retirees/. Accessed May 11, 2018.

2 Michelle Singletary. The Washington Post. Feb. 26, 2018. “Should you retire your debt before retiring?” https://www.washingtonpost.com/news/get-there/wp/2018/02/26/should-you-retire-your-debt-before-retiring/?noredirect=on&utm_term=.d3d26dc8cda2. Accessed May 11, 2018.

3 Annie Nova. CNBC. May 9, 2018. “Almost half of Americans don’t expect to have enough money to retire comfortably — but there’s some good news.https://www.cnbc.com/2018/05/09/almost-half-of-americans-dont-expect-to-have-enough-money-to-retire-comfortably–but-theres-some-good-news.html. Accessed May 11, 2018.

4 Anthony P. Curatola. MarketWatch. May 10, 2018. “Watch for these pitfalls if you want to deduct mortgage interest under the new tax law.” https://www.marketwatch.com/story/watch-out-for-these-pitfalls-if-you-want-to-deduct-mortgage-interest-under-the-new-tax-law-2018-05-09. Accessed May 11, 2018.

5 Kathy A. Bolten. Des Moines Register. April 2, 2018. “Thousands of Iowa parents are going into debt to pay for their kids’ college (and they probably shouldn’t).” https://features.desmoinesregister.com/news/parent-plus-student-loans-college-debt/. Accessed May 11, 2018.

6 Sharon Epperson. CNBC. Nov. 16, 2017. “Don’t let surprise medical bills drain your retirement.” https://www.cnbc.com/2017/11/15/dont-let-surprise-medical-bills-drain-your-retirement.html. Accessed May 11, 2018.

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

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