Medicare enrollees can save hundreds of dollars on premiums and out-of-pocket costs by doing a checkup on their coverage in the weeks to come. But few bother to review what they’ve got or make changes.
If you use traditional fee-for-service Medicare and have a Medigap supplemental plan–and you’re happy with what you have–there’s no need to do anything during annual enrollment. But if you have Part D prescription drug coverage, or are enrolled in Medicare Advantage (the managed care alternative to traditional fee-for-service Medicare), it can pay to kick the tires. Click here to read a comprehensive article and checklist from Morningstar.
Essentially, there are two brains at work among investors: a relatively hopeful one thinking now is a good time to BUY because of continuing jobs growth, the consumer being in good shape, the FED remaining a friend to investors, and a rebounding of manufacturing. But, there is also gloomy “SELL” brain raising the specter of Presidential Election uncertainty and the possibility the FED will raise rates quickly. The two brains alternate in effectiveness causing the markets to wildly fluctuate. Unfortunately, I see these fluctuations continuing until after the Election.
Investors are advised to continue to think of their portfolios as long term and monitor the factors in The “Heat Map” below.
New Jersey Gov. Chris Christie ended the longstanding reciprocal tax agreement between New Jersey and Pennsylvania. The agreement had exempted employees that live in New Jersey and Pennsylvania but worked on the opposite side of the Delaware River from being taxed in the state where they worked.
If Christie does not reverse his decision to terminate the pact, many commuters may face larger overall state and local tax liabilities beginning January 1, 2017. No taxpayers living in either state will pay less tax as a result of this change.
If you are an affected taxpayer, please contact us for more details on how this action will change your state income tax.
Changes to the “FAFSA” (Free Application for Federal Student Aid) Process for 2017–18
SUBMIT A FAFSA EARLIER: Students will be able to submit a 2017–18 FAFSA as early as Oct. 1, 2016, rather than beginning on Jan. 1, 2017. The earlier submission date will be a permanent change, enabling students to complete and submit their FAFSAs as early as October 1 every year. (There is NO CHANGE to the 2016–17 schedule. The 2016–17 FAFSA became available Jan. 1, 2016.)
USE EARLIER INCOME AND TAX INFORMATION: Beginning with the 2017–18 FAFSA, students will be required to report income and tax information from an earlier tax year. For example, on the 2017–18 FAFSA, students (and parents, as appropriate) will report their 2015 income and tax information, rather than their 2016 income and tax information.
Here’s a summary of key dates for submitting the FAFSA depending on when you plan to go to school:
“Pay yourself first.” Many have heard that term but fail to implement it into their personal finance strategy. Those who either have a savings goal OR have trouble prioritizing their savings may want to set up a routine, automatic “periodic investment program” into a solid growth and income mutual fund. It’s less complicated than its name. Just specify the amount per month (say $100) that you think you can afford. The amount can be withdrawn automatically from your checking account. And, try to save at least 25% of annual bonuses or windfalls to this periodic investment program. This investment style, sometimes referred to as “dollar cost averaging” is a good approach to investing because you end up purchasing more shares when the price of the fund is low. It’s a proven technique, but remember, dollar cost averaging does not assure a profit or protect again loss in declining markets.
The two following news stories illustrate how incapable our government has become in pulling off a technological advancement and also how capable (and feared!) the Russians have become.
On July 30, 2016, the Social Security Administration began requiring new and current Social Security account holders to sign into their account using a one-time code text message as an extra measure on online security. Merely, two-weeks later, the agency reversed itself. The SSA’s stepped-up security measure encountered technical problems from the start. “Our aggressive implementation inconvenienced or restricted access to some of our account holders (so it was dropped),” Social Security press office.
After Russian 800-meter runner Yulia Stepanova and her husband exposed the systematic state-sponsored doping regimen pervasive in Russian athletics, the couple and their young son fled to the United States, fearing for their safety. Now it seems that their fears were well founded. The World Anti-Doping Agency (WADA) announced Aug. 13 that hackers had illegally accessed Stepanova’s account in an agency database, which contains, among other personal information, her family’s address in the United States. (Athletes are required to maintain current address information in the WADA system to facilitate unscheduled, off-competition drug testing.) WADA also noted that no other accounts had been accessed in the data breach, suggesting that Stepanova, who has since moved again with her family, was the specific target of the hack.
That someone’s personal information was compromised by a data intrusion is hardly surprising in this age of widespread hacking. It is unusual, however, for hackers to home in on a single person in the course of an attack. The Kremlin’s track record in dealing with those who cross it — even people who seek refuge in the West — proves that the Russia’s government has a long reach, made all the longer by the country’s prodigious hacking capabilities.
As the outcome of the race for U.S. President becomes clearer, it is interesting to review the past for rates of return on the S&P 500 index under different political parties. The last 50 years were used to derive the following stats. They represent annual total returns for the stock market as measured by the S&P 500 Index.
Democrat President and a Republican-led Congress: 18%
Republican President and a Democrat-led Congress: 4.5%
The White House and Congress controlled by the same political party: 11.9%
When the House and the Senate were controlled by different parties (regardless of which party is in the White House): 2%
Disclosure note: The above rates of return represent total return which adds the dividend on the stocks in the index to the change in value of the stock index. The S&P 500 index is comprised of 500 stocks and is market cap weighted (each stock weighting within the index is dependent upon the market value of the stock).
The Bank of England (a similar institution to our Federal Reserve Bank) lowered its benchmark interest rate to .25%, the lowest rate in its 322 year history.
The move is designed to stimulate the British economy by encouraging increased borrowing by British corporations and consumers. However, many economic experts question the effectiveness of such a strategy.
We have made the case in recent articles for the U.S. Government improve management of its spending and debt. But, according to the Wall Street Journal, no matter who wins the White House in November, don’t expect to hear new calls for reduced spending.
Gone are the fights of yesteryear over striking a “grand bargain” to slash the debt. In their place a new debate has emerged over whether America’s borrowing capacity has gone up—and how the nation might take advantage of it.
The top candidates from both major parties have made scant mention of addressing rising long-term deficits and are calling instead for an increase in federal stimulus.
Republican nominee Donald Trump has outlined massive tax cuts and, without getting specific, has promised big federal outlays on infrastructure, border security and an expansion of health-care services for veterans.
The GOP platform calls for a constitutional amendment requiring balanced budgets, but that’s easier said than done, as illustrated by congressional Republicans’ inability to pass a budget resolution this year.
Hillary Clinton, the likely Democratic nominee, also has issued proposals for spending on roads and higher education, projects she would fund with new taxes on higher-income earners and the financial industry.
Four years ago, the Democratic Party platform referred seven times to cutting the deficit. The platform that delegates will consider at this week’s convention in Philadelphia doesn’t mention the deficit and pledges to pay for new spending.
So what accounts for the shifting political dynamic?
First, an expanding economy and the budget agreements of recent years have returned near-term deficits to their long-run averages. Second, health-care cost growth, a major driver of projected deficits, has slowed. Third, markets indicate borrowing costs may be lower for longer than anyone expected just a few years ago amid weaker global growth prospects.
As you may recall, we have been advising you to refinance your debt now. We would like to take this opportunity to give the United States Government some advice regarding its debt:
Cool it, US Government! You are spending way beyond your means. The national debt has more than doubled in 8 short years from $9.5 Trillion to $19.3 Trillion. And, we do not hear either candidate suggesting the U.S. Government must cut spending to control the deficit.
The yield on the U.S. Treasury Note with a 10 year maturity HAS NEVER BEEN LOWER. The yield was 1.36% on 7/8/2016, the lowest rate in its 225 year history.
Go Long! Every student of Finance knows borrowers, in this case the U.S. Government, should borrow using the longest maturity when interest rates are low. But, only 13% of U.S. Government debt has a maturity of over 10 years.
Go even Longer! The longest maturity U.S. Government bond issued is currently 30 years in length. But, why 30 years? Why not 50 years? Other developed nations have issued 50-year bonds. Why not United States?
