Shortlink

Paying for Healthcare, One Way or Another

Despite a rough start, enrollment in private health plans through The Patient Protection and Affordable Care Act (commonly referred to as “Obamacare”) was at three million by the end of January. Some five million are expected to sign up by the March deadline — a considerable improvement from its inauspicious beginnings, but still about two million shy of the White House’s projected goal.

One of the key tenets of the mandated insurance provision is for plenty of healthy young adults to enroll to help offset the costs of those who are older and presumably run up more healthcare costs. The numbers were actually skewed the other way as of mid-January — 55 percent of enrollees were age 45 and above while 45 percent of enrollees were age 44 and younger.

[CLICK HERE to read the article, “Obamacare Private Plan Enrollment Reaches 3 Million,” at Bloomberg Businessweek, Jan. 24, 2014.]

[CLICK HERE to read the article, “States make more progress in Obamacare enrollment,” at CNBC.com, Jan. 29, 2014.]

[CLICK HERE to read the article, “Who’s Buying Obamacare, in Three Charts,” at Bloomberg Businessweek, Jan. 13, 2014.]

Medicare Expansion, or Lack Thereof

A 2012 Supreme Court decision held that Medicaid eligibility expansion would be left up to individual states. However, if employer-offered health plans are deemed too expensive (if plans cost workers more than 9.5 percent of their family income or pay less than 60 percent of their medical costs) and workers then buy subsidized Obamacare insurance, businesses may face a tax penalty of up to $3,000 per worker who purchase private health insurance from an exchange.

This Medicaid expansion-related tax will impact employers with more than 50 full-time workers starting in 2015. Presently, there are 25 states that chose not to expand Medicaid coverage, and the collective tax hit to their employers could be substantial: In Texas, as much as $400 million; Florida, as much as $253 million, and North Carolina, as much as $120 million.

[CLICK HERE to read the article, “Employers face tax hit in states with no Medicaid expansion,” at CNBC.com, Jan. 22, 2014.]

Mind the (Income) Gap

According to a recent survey by the National Center for Health Statistics at the CDC, one in four U.S. families struggled to pay medical expenses in 2012, and one in 10 said they couldn’t pay some bills at all. In fact, unpaid medical bills are the foremost reason why households are forced to declare personal bankruptcy — including those that have health insurance coverage.

However, another study from the Brookings Institution indicates that the Affordable Care Act (ACA) will help improve the well-being and incomes of Americans in the bottom fifth of the income distribution by increasing their income by as much as 6 percent. The study uses an expansive definition of income to include part of the value of insurance.

ACA employs certain wealth redistribution provisions such as Medicaid expansion, subsidies, higher Medicare premiums, Medicare payroll tax contributions, and a new investment tax on high-income taxpayers. As a result of these redistribution provisions, “the gains and losses cause small proportional drops in income for Americans in the top three-quarters of the income distribution.”

[CLICK HERE to read the article, “One in four U.S. families struggles to pay medical bills,” at Employee Benefit News, Jan. 28, 2014.]

[CLICK HERE to read the article, “Potential Effects of the Affordable Care Act on Income Inequality,” at The Brookings Institute, Jan. 27, 2014.]

Meanwhile, Republican Congressmen have proposed an alternative healthcare plan to replace Obamacare, with similar-yet-different provisions that also serve to redistribute wealth via tax credits and expanded Medicaid eligibility. According to one health policy academic, “There’s no way a Republican can run for president in 2016 without having a major health-care plan.”

[CLICK HERE to read the article, “Republican Senators Pitch Obamacare Replacement for 2017,” at Bloomberg, Jan. 27, 2014.]

If you’re concerned about how healthcare expenses could impact your overall financial picture, please feel free to contact us for an evaluation.

By contacting us, you may be provided with information regarding the purchase of insurance products.

These articles are being provided to for informational purposes only and should not be used as the basis for any financial decisions.  While we believe this information to be correct, we do not guarantee the accuracy or completeness of the information included. All clients are encouraged to consult qualified tax and legal professionals before making any decisions about your personal situation.

AE02140116

Shortlink

Olympi-nomics

In the wake of the recent Olympic winter games in Sochi, Russia, a number of economists have mounted theories linking success at Winter Olympics with economic development for participating countries.

One such research paper by two French professors purports that the number of Olympic medals a country wins is directly correlated to that nation’s population and per-capita income. Based on their calculations, the U.S. was projected to lead in the medal count with 36, followed by Germany (28), and Canada (27), with Russia and Norway tied (24) in fourth place.*

[CLICK HERE to read the article, “Predicting the Winter Olympics with Economics,” at Freakonomics.com, Feb. 11, 2014.]

[CLICK HERE to read the article, “A Strong Economy Is the Secret to Winning Medals at the Winter Olympics,” at BusinessInsider.com, Feb. 9, 2014.]

Then there’s the question of how much being the host country for the Olympics can help that nation’s economy. In the case of Russia, its economy grew by only 1.3 percent in 2013, following a 7 percent average annual rate in the first eight years of Russian President Vladimir Putin’s rule.

The Russian government banked on the idea that hosting the Winter Olympics would have a significant long-term impact on the country’s economy. Money that could have been spent on schools, hospitals and general infrastructure was allocated to the construction and modernization of the airport, 260 kilometers of roads, highway interchanges and bypasses; 200 kilometers of railway, 54 bridges and 22 tunnels; 14 brand new venues and 19,000 hotel rooms.

Apparently the winter games are more expensive to plan and train for than the summer games. The investment to host this Olympic event was said to cost around $50 billion. Clearly, a lot of people had to be interested in visiting Sochi — which was only just developed as a ski resort destination in preparation for the event — for the games to deliver long-term returns to the host country.

[CLICK HERE] to read the article, “Are the Sochi Olympics Economically Worthwhile?” at DailyForex.com, Feb. 12, 2014.

[CLICK HERE to read the article, “Sochi Olympics: Going for the Gold, Spending in the Red,” at NBCnews.com, Feb. 14, 2014.]

Then again, a few of those new 19,000 hotel rooms weren’t quite finished. In fact, journalists from around the world had a field day tweeting about their accommodations, ranging from unfinished rooms to undrinkable water.

[CLICK HERE to read the article, “Journalists at Sochi are Live-Tweeting Their Hilarious and Gross Hotel Experiences,” from The Washington Post, Feb. 4, 2014.]

[CLICK HERE to read the article, “Images from Sochi: From the Bizarre to the Sublime,” at CBSnews.com, Feb. 8, 2014.]

If there’s a lesson we as individuals can take from this year’s Winter Olympic Games, it’s the importance of carefully considering our return on investment before we make an expensive purchase. Well, that and to pursue our dreams with passion and commitment the way our heroic Olympians do.

*Actual medal count rank was Russia (33), United States (28), Norway (26), Canada (25), Netherlands (24) and Germany (19).

By contacting us, you may be offered information regarding the purchase of insurance products.

These articles are being provided for informational purposes only and should not be used as the basis for any financial decisions. While we believe this information to be correct, we do not guarantee the accuracy or completeness of the information included.

AE02145004

Shortlink

Tax Updates

As we enter tax season, many issues abound. Congress is back in session and, you never know, may at some point start discussing ideas for tax reform. Whether or not Congress tackles reform provisions this year, things may change within the tax landscape. That’s because every year there are a plethora of provisions that will expire unless Congress takes action. A list of these expiring federal tax provisions is detailed in a report from the Joint Committee on Taxation.

[CLICK HERE to read the article, “Tax Policy Update,” at Mondaq.com, Jan. 20, 2014.]

[CLICK HERE to read the “List of Expiring Federal Tax Provisions,” at the Joint Committee on Taxation, Jan. 10, 2014.]

Also on the tax front, the IRS continues to issue new guidance for the 2014 tax year. Starting January 1, participants in employer 401(k) plans may convert assets from tax-deferred vehicles to a Roth account (if offered within the plan). Before this year, only participants eligible for retirement distributions could take advantage of this option. Assets converted will be taxed in the year they transfer to the Roth account, and the beauty of this new feature is that you can pay taxes on your previous contributions while you’re still working – then enjoy income tax-free distributions of principal and subsequent earnings once you retire.

[CLICK HERE to read the article, “IRS Issues Notice on Expanded In-Plan Roth Conversion Option,” at Morgan Lewis, Dec. 18, 2013.]

If you owe a backlog of taxes, don’t forget about the IRS’ Fresh Start Program. This program permits taxpayers to make monthly installment payments on back taxes without getting hit with a federal tax lien. Last April the agency expanded its provision to allow individual taxpayers who owe up to $50,000 to make payments via a direct debit installment plan for up to six years. The easiest way to apply for a payment plan is to use the Online Payment Agreement tool at IRS.gov.

[CLICK HERE to read the news release,  “IRS Fresh Start Program Helps Taxpayers Who Owe the IRS,” at IRS, April 17, 2013.]

It is likely that as we file our 2013 returns this year, there are lessons we will learn following the first full year since the American Taxpayer Relief Act of 2012 (ATRA) was passed. A representative of AllianceBernstein projects that between ATRA and the new Medicare surtax, some taxpayers will face up to 14 percent higher taxes over last year.

Complex returns may require the services of a qualified tax advisor, but many people opt to complete their own returns – which is not a bad way to learn important lessons first hand to help plan for next year. The IRS has created a series of videos to help individuals prepare their returns focusing on a variety of tax topics.

[CLICK HERE to read the blog, “Lessons Learned in 2013,” at AllianceBernstein, Dec. 15, 2013.]

[CLICK HERE to read the article, “IRS Offers Videos to Help Taxpayers Preparing to File in 2014,” at the IRS, Jan. 3, 2014.]

We’re happy to work with you on 2014 financial strategies. If you have questions or would like to schedule a no-obligation meeting, please contact us.

By contacting us, you may be offered information regarding the purchase of insurance products.

These articles are being provided to for informational purposes only and should not be used as the basis for any financial decisions.  While we believe this information to be correct, we do not guarantee the accuracy or completeness of the information included. All clients are encouraged to consult qualified tax and legal professionals before making any decisions about your personal situation.

1401092

Shortlink

Happy Days Are Here Again…

What a difference a couple of years made — from challenging times in Europe to the plummet in domestic home values to unemployment approaching double digits. The economic recovery in the U.S. may have been slow, but it has hardly been nonexistent.

As we gaze into the crystal ball for 2014, the typical signs and leading economic indicators look good. The following reports and insights by industry analysts and experts definitely offer an air of optimism. And it’s about time. Enjoy.

[CLICK HERE to read the article, “Q1 2014 Update: Seven Key Takeaways,” at Fidelity Investments, Jan. 10, 2014.]

[CLICK HERE to read the article, “Keep Optimistic and Carry On,” at Guggenheim Partners, Jan. 15, 2014.]

[CLICK HERE to read the monthly letter, “Improving Growth, Low Inflation and Favorable Markets,” at Merrill Lynch CIO Reports, December 2013.]

[CLICK HERE to read the article, “The Case for Optimism,” at Merrill Lynch Wealth Management, 2014.]

[CLICK HERE to read the report, “Squeezing out More Juice,” at BlackRock, December 2013.]

[CLICK HERE to read the report, “Outlook 2014,” at Oppenheimer Funds, Dec. 9, 2013.]

[CLICK HERE to read the report, “On the Markets,” at Morgan Stanley Smith Barney, January 2014.]

[CLICK HERE to read the report, “Outlook 2014,” at BNY Mellon, Nov. 7, 2013.]

[CLICK HERE to read the report, “2014 Economic and Market Outlook,” at Wells Fargo Advisors, December 2013.]

Has there been a tangible difference in your financial life since the Great Recession? Do you breathe a little easier, open up your wallet a little more often in support of economic growth, of course — knowing the country is on a path to more prosperous times?

If your yesterday was blue, we hope your today is brighter. We’d like to help you take advantage of this uptick on the financial and economic landscape. After all, the plans you make today will help determine what your future holds — since we all know what a difference a couple of years make. And the difference is you. Please contact us if we can help.

By contacting us, you may be offered information regarding the purchase of insurance products.

These articles are being provided for informational purposes only. While we believe this information to be correct, we do not guarantee the accuracy or completeness of the information included.

1401075

Shortlink

Long-term Goals

One of the hallmarks of contemporary society is that we want everything right now. We can communicate 24/7 via text, phone, email, tweets and posts and wouldn’t dream of driving on a long trip without a fully charged phone. Remember when cars used to break down on the side of the road and you had to hoof it to the nearest phone?

We’ve raised children who require immediate satisfaction. We can get TV and movies on demand, and we can even pause our personal televisions and devices for a bathroom break and then start shows and newscasts back up again — whenever we demand.

But some things are better achieved by waiting. For example, you can lose weight with a surgical procedure, or you can embark on a long-term program of nutritional eating and exercise; many people view the latter as more preferable. We tend to forget that the long-term process can be more fulfilling, such as growing your own vegetables instead of buying them at the grocer or reading the book instead of — or at least before — you watch the movie.

The beginning of a new calendar year may be a good time to reassess what we want to accomplish and, perhaps more importantly, how we want to accomplish it.

Recently, Mercer published findings of a study on the potential for offering shareholder loyalty rewards. The research was conducted to find ways to entice public corporations to follow more long-term strategies rather than hit short-term earnings goals at the behest of shareholders. If shareholders were more incented to invest for the long haul, perhaps companies could do the same. But as it turns out, the idea of granting extra dividends, warrants or additional voting rights to investors who hold shares for a long term, such as a minimum of three years, was not well received for a variety of reasons.

[CLICK HERE to read the news release, “Mercer ‘Loyalty Shares’ Research Indicates Consensus on Negative Impact of Short-Termism,” at Mercer.com, Dec. 18, 2013.]

[CLICK HERE to read the report, “Building a Long-Term Shareholder Base: Assessing the Potential of Loyalty-Driven Securities,” at Mercer.com, Dec. 18, 2013.]

However, the long-term approach does often present rewards, as billionaire investor Warren Buffett will attest. Over the last 10 years, Berkshire’s stock has gained 111.16 percent, significantly outperforming the 66.23 percent return of the Standard & Poor’s 500 Index over the same timeframe.

[CLICK HERE to read the article, “Buffett Beats S&P for Second Straight Year,” at CNBC.com, Dec. 31, 2013.]

One of your long-term goals may be paying off debt, which one young couple did with very strict discipline and by, interestingly enough, learning carpentry and gardening skills. Working low-paying jobs during the economic downturn, they managed to pay down about $116,000 in student loans and $2,000 in car payments while also starting a family and saving for a down payment to buy a home.

[CLICK HERE to read the article, “How One Family Paid off Almost $118,000 in Debt,” at Yahoo.com, Jan. 2, 2014.]

But alas, one of the tougher things to achieve is long-term happiness. A night out with friends, a memorable vacation and even a bowl of ice cream can provide short-term bliss. However, sustaining happiness over a lifetime requires some real effort. A 75-year survey, known as the Harvard Grant Study, provides some insights on how it can be accomplished.

“The conclusion of the study, not in a medical but in a psychological sense, is that connection is the whole shooting match,” observed George Vaillant, Harvard psychiatrist and director of the study from 1972 to 2004.

[CLICK HERE to read the article, “The 75-Year Study that Found the Secrets to a Fulfilling Life,” at HuffingtonPost.com, Aug. 11, 2013.]

No doubt, considering the world as it is today with the ease of technology and convenience of fast food, it’s tempting to take the most expedient route to satisfaction. But like a long, sudsy bath or a hike in the woods, some things are better enjoyed by taking your time.

If we can help you with a long-term financial strategy, please give us a call.

By contacting us, you may be offered information regarding the purchase of insurance products.

These articles are being provided for informational purposes only. While we believe this information to be correct, we do not guarantee the accuracy or completeness of the information included.

AE01140011

Shortlink

What’s Ahead for 2014?

The usual pundits and prognosticators are at it again — making all sorts of predictions and observations about how this next year will play out.

For starters, the New Year will get a little darker. That’s because manufacturers will cease making 40- and 60-watt incandescent bulbs, having already phased out the production of 100- and 75-watt bulbs in 2012 and 2013. You can still buy incandescent bulbs as long as supplies last, but U.S. manufacturers are no longer permitted to produce or import them. Incandescent bulbs do not meet the new standards that require all screw-in light bulbs to use 25 percent less power by 2014 and 65 percent less by 2020. It appears we are in for darker times moving forward, indeed.

[CLICK HERE to read the article, “Majority of Americans Still in the Dark About Incandescent Light Bulb Phase-Out,” from NBC News, Dec. 26, 2013.]

[CLICK HERE to read the “Sylvania Socket Survey,” from Sylvania, December 2013.]

On the economic front, the painstakingly slow recovery is expected to continue. Wall Street analysts do not expect U.S. equities to perform as well as they did in 2013. However, if you’ve sat conservatively on the sidelines throughout this latest bull market, remember that small corrections and price drops offer the opportunity for selective entry points. You may want to evaluate your retirement strategy for this year and consider what may work best for your situation.

[CLICK HERE to read the article, “Here’s What 14 Top Wall Street Strategists are Saying About the Stock Market in 2014,” at FinancialPost.com, Dec. 26, 2013.]

As you review your financial picture, also stay cognizant of the upcoming changes in tax laws for 2014. Tax breaks on the chopping block include deductions for college tuition and fees, private mortgage insurance premiums and mass transit commuter expenses.

[CLICK HERE to read the article, “8 Disappearing Tax Breaks,” at CNNMoney.com, Dec. 27, 2013.]

Politically, it should be yet another interesting year as hopefuls and members of Congress prepare for the 2014 elections. We enjoyed a slight whisper of bipartisanship with the signing of the new budget bill in December, but this will once again be tested when the deficit ceiling is reached this spring. Another hot item expected to be debated this year is immigration law.

[CLICK HERE to read the article, “Obama Looks Ahead to 2014 After Finishing 2013 Business,” from The Huffington Post, Dec. 27, 2013.]

It appears Hollywood will have to step up its special effects movie-making game if it wants to keep up with the United States military. This year, the Navy expects to launch its first laser weapon on board a ship in the Persian Gulf, the Army is making a serious effort at taking advantage of 3-D printing technology and the Air Force is hiring a slew of “cyber professionals” to progress in areas of cyber warfare.

[CLICK HERE to read the article, “Military Tech in 2014: Lasers, Drones and Cyberops,” at Cnet.com, Dec. 27, 2013.]

And to end on a light note, if you’re a fan of film, the next link provides a detailed list of movies you can look forward to watching in 2014.

[CLICK HERE to read the “The Most Popular Feature Films Released in 2014,” at IMDB.com, Dec. 27, 2013.]

As usual, if there’s anything we can do to help you make your financial outlook brighter and increase your confidence in retirement, please give us a call. By contacting us, you may be offered information regarding the purchase of insurance products.

These articles are being provided to you for informational purposes only. While we believe this information to be correct, we do not guarantee the accuracy or completeness of the information included.

1401006

Shortlink

Win/Loss Columns: An Exciting End to 2013

Well, perhaps we missed the excitement of yet another year-end cliffhanger like we had in 2012. This year, Congress got it together long enough to recess with a budget deal ready for the president’s signature. The Bipartisan Budget Act of 2013 was initiated by dealmakers Sen. Patty Murray, D-Wash., and Rep. Paul Ryan, R-Wis. Let’s put that one in the “win” column, for at the very least we won’t have to experience the threat of another government shutdown.

The passage of this bill was a pretty strong accomplishment for the partisan Congress, although during the 2013 session it had enacted only 66 laws as of Dec. 25. In the past, the average has been 162.

[CLICK HERE for the summary report, “Summary of the Bipartisan Budget Act of 2013,” from the House of Representatives Committee on the Budget, Dec. 10, 2013.]

[CLICK HERE to read the article, “Entrepreneurship: A Timeless, Ageless Passion,” at Forbes.com, Dec. 9, 2013.]

There were a number of other year-end surprises as well. Target stores recently confirmed that the credit and debit card information of as many as 40 million accounts had been compromised, and those who shopped at the store’s brick-and-mortar locations just after Thanksgiving became possible victims of fraud abuse. It appears that there are now phony credit cards available on the black market that were created using stolen information as part of the Target data breach. We’ll put that one in the “loss” column.

[CLICK HERE to read the article, “40 Million Target Customers Affected by Security Breach,” at Forbes.com, Dec. 19, 2013.]

[CLICK HERE to read the article, “Stolen Target Credit Cards Available on Black Markets Everywhere,” from Los Angeles Times, Dec. 20, 2013.]

[CLICK HERE to read the article, “Cards Stolen in Target Breach Flood Underground Markets,” at Krebson Security, Dec. 13, 2013.]

Pop music star Beyoncé scored a big “win” late in the season with a surprise album launch available exclusively on iTunes. Her recent, multi-song release was promoted by only one avenue: a 15-second video posted on her Instagram webpage. The pop star demonstrated the power of social media’s reach by selling more than 800,000 “copies” of the album in just the first three days. It’ll be interesting to see if other musicians will have the clout — and courage — to follow the same strategy.

[CLICK HERE to read the article, “Ignore the Hype. Beyoncé’s Release Was Totally Old-School,” from The Washington Post, Dec. 17, 2013.]

Alternatively, a not-so-famous musical group — the Holderness family of Raleigh, N.C. — scored big on the viral music video network. It seems the lively family of four takes great pride in the production of their annual Christmas video, as it does make for much more engaging entertainment than the usual Christmas letter. See this “win” for yourself.

[CLICK HERE to read the article, “‘Christmas Jammies’ Rockets Holderness Family to Viral Video Fame,” from The Huffington Post, Dec. 15, 2013.]

Regardless of the nationwide year-end picks and pans, we hope that when you evaluate 2013 in the context of your own life, you’ll have more wins than losses. If we can help you improve on that record in 2014, please contact us.

By contacting us, you may be offered information regarding the purchase of insurance products.

These articles are being provided to you for informational purposes only. While we believe this information to be correct, we do not guarantee the accuracy or completeness of the information included.

AE12130935

Shortlink

Win/Loss Columns: An Exciting End to 2013

Well, perhaps we missed the excitement of yet another year-end cliffhanger like we had in 2012. This year, Congress got it together long enough to recess with a budget deal ready for the president’s signature. The Bipartisan Budget Act of 2013 was initiated by dealmakers Sen. Patty Murray, D-Wash., and Rep. Paul Ryan, R-Wis. Let’s put that one in the “win” column, for at the very least we won’t have to experience the threat of another government shutdown.

The passage of this bill was a pretty strong accomplishment for the partisan Congress, although during the 2013 session it had enacted only 66 laws as of Dec. 25. In the past, the average has been 162.

[CLICK HERE for the summary report, “Summary of the Bipartisan Budget Act of 2013,” from the House of Representatives Committee on the Budget, Dec. 10, 2013.]

[CLICK HERE to read the article, “Entrepreneurship: A Timeless, Ageless Passion,” at Forbes.com, Dec. 9, 2013.]

There were a number of other year-end surprises as well. Target stores recently confirmed that the credit and debit card information of as many as 40 million accounts had been compromised, and those who shopped at the store’s brick-and-mortar locations just after Thanksgiving became possible victims of fraud abuse. It appears that there are now phony credit cards available on the black market that were created using stolen information as part of the Target data breach. We’ll put that one in the “loss” column.

[CLICK HERE to read the article, “40 Million Target Customers Affected by Security Breach,” at Forbes.com, Dec. 19, 2013.]

[CLICK HERE to read the article, “Stolen Target Credit Cards Available on Black Markets Everywhere,” from Los Angeles Times, Dec. 20, 2013.]

[CLICK HERE to read the article, “Cards Stolen in Target Breach Flood Underground Markets,” at Krebson Security, Dec. 13, 2013.]

Pop music star Beyoncé scored a big “win” late in the season with a surprise album launch available exclusively on iTunes. Her recent, multi-song release was promoted by only one avenue: a 15-second video posted on her Instagram webpage. The pop star demonstrated the power of social media’s reach by selling more than 800,000 “copies” of the album in just the first three days. It’ll be interesting to see if other musicians will have the clout — and courage — to follow the same strategy.

[CLICK HERE to read the article, “Ignore the Hype. Beyoncé’s Release Was Totally Old-School,” from The Washington Post, Dec. 17, 2013.]

Alternatively, a not-so-famous musical group — the Holderness family of Raleigh, N.C. — scored big on the viral music video network. It seems the lively family of four takes great pride in the production of their annual Christmas video, as it does make for much more engaging entertainment than the usual Christmas letter. See this “win” for yourself.

[CLICK HERE to read the article, “‘Christmas Jammies’ Rockets Holderness Family to Viral Video Fame,” from The Huffington Post, Dec. 15, 2013.]

Regardless of the nationwide year-end picks and pans, we hope that when you evaluate 2013 in the context of your own life, you’ll have more wins than losses. If we can help you improve on that record in 2014, please contact us.

By contacting us, you may be offered information regarding the purchase of insurance products.

These articles are being provided to you for informational purposes only. While we believe this information to be correct, we do not guarantee the accuracy or completeness of the information included.

AE12130935

Shortlink

Income Updates for Various Demographics

Despite the economic setback and slow recovery in recent years, or perhaps because of them, it seems Americans may be on a trajectory for higher income — if not higher income, then perhaps greater satisfaction with the income that they earn. Here’s a recent round-up of studies about current demographic groups and their earning prospects.

Baby Boomers
In 2012, it was the baby boomers who created a larger percentage of new firms than any other demographic. Some of the reasons these more mature workers are taking the entrepreneurial leap include:

  • Income independence – to help protect themselves from layoffs or salary cuts during economic setbacks
  • Exploring additional income opportunities – to supplement retirement savings
  • Living longer and healthier – eager to explore new (or old) interests

[CLICK HERE to read the article, “Entrepreneurship: A Timeless, Ageless Passion,” at Forbes.com, Dec. 9, 2013.]

[CLICK HERE to read the report, “Kauffman Index of Entrepreneurial Activity 1996-2012,” from The Kauffman Foundation, April 17, 2013.]

Women
According to the U.S. Census Bureau, the number of U.S. women with six-figure incomes is rising at more than three times the rate of men who earn that much. Among developing nations, women’s earned income is increasing faster than men’s earned income (8.1 percent versus 5.8 percent). And within just 15 years, the Boston Consulting Group projects that women as a group will out-earn men. 

[CLICK HERE to read the article, “Women Power,” at Merrill Lynch Advisor, Fall/Winter 2013.]

Young Adults
As it turns out, the Millennials who graduated during the bleak years of the recession might not turn out so disadvantaged after all. According to research by an assistant professor of Goizueta Business School at Emory University, college graduates who entered the workforce during economic downturns are significantly more satisfied with their jobs throughout their careers. The analysis suggests that when early job experiences are subjected to adverse circumstances, people are more apt to be grateful just to have a job and less likely to ruminate on how they could do better. So in an interesting twist, the generation we previously criticized as “entitled” may end up being very productive — and very content — with whatever levels of accomplishment they achieve in life.

[CLICK HERE to read the article, “Research: Recession Grads May Wind Up Happier in the Long Run,” at The Harvard Business Review Blog Network, Dec. 5, 2013.]

After all, money doesn’t necessarily lead to happiness — although another study does indicate that riches can make you smarter. A recent Brookings study revealed that children from wealthy families scored higher on standardized tests. By their late teens, six out of every 10 children from upper-echelon families placed among the top third of test takers, indicating that the more money a family has, the more academic enrichment those children receive.

And, while academic achievements often translate into better paying jobs, wealth doesn’t always pave the way. According to the Brookings study, bright and driven poor children had a pretty good chance of moving up the status pole to the upper-middle class. The study further asserts that “there also seemed to be a ‘glass floor’ that kept a great many wealthy kids with ‘mediocre skills’ from sliding into (relative) poverty.”

[CLICK HERE to read the article, “Would You Rather Be Born Smart or Rich?” at The Atlantic, Dec. 2, 2013.]

There are some good lessons to be learned from these research findings. Perhaps we should all be more mindful and grateful for what we have, while never letting a glass ceiling (or floor) stop us from reaching our potential. Whatever your income, or state of mind about it, we’re here to help you make the most of it.

By contacting us, you may be offered information regarding the purchase of insurance products.

These articles are being provided to for informational purposes only. While we believe this information to be correct, we do not guarantee the accuracy or completeness of the information included.

1312071

Shortlink

Skewing Data

Every day we see reports, surveys, research and analysis of data that’s been commissioned and compiled by government agencies, private businesses and third party think tanks. While much of the information is informative, it usually indicates a larger story, or trend, and should be reviewed within a certain context.

For example, a recent jobs report has reduced the country’s unemployment rate to 7 percent, which is quite positive. However, the Bureau of Labor Statistics points out in the report that the data reflects the numbers of previously furloughed federal employees who were permitted to return to work after the government shutdown in October. Employment reports this time of year also tend to be influenced by the pickup during the holiday season.

As such, it’s important to view the jobs report within context and be wary of making decisions based on positive data — factors to be considered in both the stock market and in anticipating the moves of the Federal Reserve.

[CLICK HERE to read the release, “Employment Situation Summary,” at BLS.gov, Dec. 6, 2013.]

[CLICK HERE to read the article, “Jobs Report: U.S. Economy Added 203k Jobs in November, Unemployment Down to 7 Percent,” at Forbes.com, Dec. 6, 2013.]

[CLICK HERE to read the article, “5 Trends Beneath the Surface in November Jobs Report,” from The Salt Lake Tribune, Dec. 8, 2013.]

Alas, even results from this year’s Black Friday and Cyber Monday benefit from analysis beneath the surface. Bloomberg reports that while 2 million more people shopped this Black Friday, they actually bought less than in recent years. This was attributed to the fact that shoppers tend to be on a mission this year — only buying the products on their list and eschewing great deals that amount to no more than impulse buying. Should this be an enduring trend, what a great lesson to come out of the recession: The hope that Americans may be more discerning about how they spend discretionary income in light of the impact that an economic setback can have.

[CLICK HERE to read the article, “Retail Results Have Been Counted, so We Know Who Wins,” at Bloomberg.com, Dec. 3, 2013.]

[CLICK HERE to read the article, “Black Friday 2013 in Review,” from The Christian Science Monitor, Dec. 4, 2013.]

It seems that every time a news report is released with a new study — with presumably objective findings — a monsoon of analysis follows. And that analysis is not always objective; it is often skewed to meet the author’s objective.

The fact is that our interpretation of nearly everything is skewed by the culmination of our experiences and influences. It can be difficult to determine what is wrong, what is right and what is simply accurate — particularly in such a politically partisan environment.

[CLICK HERE to read the article, “29,000 Sign up for Insurance on Improved HealthCare.gov Site,” at NBCnews.com, Dec. 4, 2013.]

[CLICK HERE to view the video, “Is Obamacare on the Road to Recovery?” at FoxNews.com, Dec. 7, 2013.]

At the end of the day, we interpret news and data in terms of how it impacts our own personal situation. It’s our goal to understand each of our clients’ situations and assess their needs within the context of their retirement strategy in order to help them make informed decisions. For more information on how we may be of assistance, please contact us.

By contacting us, you may be offered information regarding the purchase of insurance products.

These articles are being provided to for informational purposes only. While we believe this information to be correct, we do not guarantee the accuracy or completeness of the information included.

1312034