Ameriprise Financial http://so-l.ru/tags/show/ameriprise_financial Wed, 23 May 2018 11:59:38 +0300 <![CDATA[Legal Pot Is Notoriously White. Oakland Is Changing That.]]> OAKLAND, Calif. —On a Friday in January 2017, the night of President Donald Trump’s inauguration, Ebele Ifedigbo and Lanese Martin welcomed several dozen people to a cozy office in a marijuana-friendly part of the city cheekily nicknamed “Smoakland.” As folks lounging on comfy couches lit joints and puffed from vape pens, the two business school grads explained they were launching a project of their own, a nonprofit that would do something no one in the nation had ever done.

As they put it, they were going to train black and brown people to start their own legal cannabis companies.


In the audience, Linda Grant listened intently. Grant, who once sold enough weed to help support her children, had gotten out of the illegal drug trade to avoid a lengthy prison sentence. Since then, Grant, a 49-year-old mother of six, had watched her hometown become one of the unofficial capitals of the state’s ever-expanding cannabis business—an industry projected to do $6.5 billion in sales statewide by 2020. Oakland, with its decidedly left-leaning political vibe, was rife with cannabis-related businesses, legal and otherwise. But Grant’s dream of becoming the first black female owner of a cannabis dispensary on the east side of the city, where she lived, still felt out of reach. What she was hearing from these two millennial activists was a way forward that she didn’t know existed.

Ifedigbo and Martin founded the Hood Incubator because they saw the recreational cannabis trade not just as a business opportunity but “as a way to correct the injustices of the war on drugs launched in the early 1970s. Though minorities like Grant had played an outsized role in building the marijuana market, they also faced a disproportionate response from law enforcement, as Martin explained to the crowd assembled that January night in 2017. As recently as 2015, Oakland officers arrested black residents nearly 20 times more often than white residents for cannabis-related crimes. Ifedigbo noted that black people had owned or founded less than 5 percent of cannabis businesses nationwide and, across all industries, black-founded startups had received just 1 percent of venture capital funding. For many years, while officials awarded more and more licenses for medical marijuana-related businesses, only one black Oaklander held a dispensary permit.


“The cannabis industry has an opportunity to make equity a core component of the industry’s DNA,” Ifedigbo said later. “Other industries have generally seen social impact [initiatives] as an afterthought.”

Oakland officials were already looking at how to use new regulations to help African-American and Latino residents get jobs more significant than what one longtime City Council member called the “security guard in the parking lot.” But Ifedigbo, 29, and Martin, 32, knew that giving these aspiring entrepreneurs permits without training—or training without permits—would likely spell failure. In January 2017, the Hood Incubator launched the nation’s first cannabis business accelerator for people of color. It began training a dozen or so aspiring entrepreneurs whose business ideas included everything from edibles, like cannabis-infused salsa, to delivery companies hoping to be the Blue Apron or Uber Eats of the weed business.



Over the course of the four-month program, Ifedigbo shared lessons learned in Ivy League classrooms with people who understood how to run a cash business but didn’t speak the formal language of the business world. One year later, the nonprofit’s first graduates are beginning to launch their businesses and it is now in the process of selecting its new class of trainees. It has since attracted multiple five-figure donations—from sources including Harborside, a local cannabis dispensary, and Echoing Green, a global nonprofit that supports social entrepreneurs—and is in the midst of a campaign to raise $500,000.


In this blue-collar city of 420,000 people, where officials acknowledge that the benefits of a recent development and jobs boom are not evenly shared across Oakland’s demographic groups, even the efforts of a relatively small outfit like Hood Incubator can help blunt the threat of gentrification that has stirred fears of displacement. Oakland Mayor Libby Schaaf foresees that cannabis equity measures will encourage new businesses, jobs and development after years of disinvestment. “I’d measure success in the families who have lived under intergenerational poverty come out of that poverty through business ownership,” Schaaf says.


Ifedigbo and Martin, while fine-tuning the Hood Incubator’s strategy in Oakland, have their eyes set on spreading the model to other cities statewide—and eventually to cities like Chicago, Detroit and Memphis. Ifedigbo and Martin believe they can rewrite the rules of corporate responsibility to make diversity more than just a goodwill gesture or publicity campaign.

“The Hood Incubator isn’t just interested in weed—or getting a few businesses off the ground—but in setting national standards,” said William Armaline, a San Jose State University sociology professor who studies drug policy reforms. “They’re interested in changing the power dynamics between communities and those doing business in and profiting from those communities.”

***

Ifedigbo, a “middle-class kid who grew up in the ‘hood’,” never had to look far to see the signs of inequality in east Buffalo, New York. Ifedigbo’s father, a Nigerian-born architect, called attention to the contrast between their neighborhood’s check-cashing stores and bodegas, and the major banks and grocers that served the whiter side of town. By the age of 12, Ifedigbo (Ih-fay-DIG-boh) was encouraged to volunteer with organizations like Meals on Wheels. As a high school senior, Ifedigbo organized a student fundraiser that raised nearly $1,800 for Hurricane Katrina victims.

“Help didn't seem to be getting there quick enough,” Ifedigbo told the Buffalo News in 2005, “so I decided to do something about it.”

Ifedigbo often thought about how racial justice could be applied to lessons economics major learned at Columbia University. Intrigued by classmates who were eager to work on Wall Street, Ifedigbo interned at Goldman Sachs and Ameriprise Financial. Private sector internships were followed by an NAACP fellowship focused on crafting state-level policies to close the wealth gap between whites and blacks. Ifedigbo, who identifies using the pronouns they or them, also worked as a peer educator with Lesbian, Gay, Bisexual and Transgender Community Center’s Gender Identity Project. After choosing Yale for business school, Ifedigbo used the coursework to study whether historically disenfranchised communities could actually benefit from capitalism.

“There was a lot of conversation about social impact,” Ifedigbo says. “But even all that still felt like the same old system with a few tweaks that lead to a few superficial outcomes. [I wanted to know]: Is there a way to shift that on its head?”


As Ifedigbo’s MBA program was wrapping up, hundreds of thousands of Californians had signed a petition to place Proposition 64 on the ballot. Ifedigbo began to read just about everything published on the burgeoning market. Ifedigbo conducted an analysis of Oakland’s cannabis industry on the cusp of it going mainstream. By that fall, with Proposition 64 destined to pass, Ifedigbo had become friends with Martin, an organizer for the progressive advocacy group Oakland Rising, after they were introduced to each other at a potluck. They brainstormed how to prevent the new economy from becoming dominated by older white men.

Martin, a Brooklyn native who had been adopted and raised by a wealthy black couple, understood that opportunity bred achievement. So, she sought insights from community members about what resources they needed to break into the legal weed business. From there, she urged Oakland council members—who were crafting cannabis business regulations—to build a program that provided the resources those residents needed most.

“The historical inequities weren’t going to disappear on their own,” council member Rebecca Kaplan said. “The permits had to deal with that.”

After a year of policy debates, Oakland officials last year created the nation’s first program designed to set aside at least half of its new cannabis permits for residents who had been targets of the war on drugs. To qualify as an “equity applicant,” residents had to make less than 80 percent of the city’s area median income—nearly $53,000 for a one-person household in 2016—and either had to have been convicted of a cannabis crime or lived for 10 years in a neighborhood where officers disproportionately arrested people for cannabis-related offenses.



Ifedigbo and Martin realized that permits alone wouldn’t help former cannabis dealers flourish as legal entrepreneurs. Enter the Hood Incubator’s business accelerator. It would help minority Oakland residents break into the legal industry with a twice-a-week boot camp run over four months. The fellows would be exposed to lessons out of an MBA textbook: the basics of everything from reading financial statements to writing a pitch deck, a snappy presentation used by entrepreneurs as they entice potential investors for funding. And they would hear directly from people in the cannabis industry, from owners to attorneys to advocates.

“It didn’t make sense to work just on policy but not have anyone pipelined in to be ready [to benefit from that policy],” Martin said. “It made sense to tackle all of it.”

***


In many ways, Linda Grant was exactly the kind of person the Hood Incubator wanted to get into the legal cannabis trade. Aside from brief gigs as a bank security guard and McDonald’s cashier, the only way Grant had ever made a living was selling weed, starting back in middle school, when she’d sell dollar joints to her classmates. On her best weeks as an adult she made roughly $2,000—which made life a bit easier for a family that relied on welfare, food stamps and housing assistance. But the risks—three arrests, fines she couldn’t always afford and the threat of at least a decade behind bars if she kept dealing—forced her out of the business by the mid-2000s.

“I didn’t have ambitions of being a nurse; I was never going to do a 9 to 5; I was never going to sit behind a desk and be bossed around,” Grant told me recently as she steered her black Chrysler 200 around East Oakland. “I wanted to sell weed.”

Even though she had attended that open house in January 2017, it took a while longer for her to act on her ambition. Last fall, having watched the first cohort of the Hood Incubator’s business accelerator graduate, she decided she needed her own permit. She already had a company name: Herbin Collective. Eventually, she wanted to start a dispensary, but dispensaries required a ton of capital. So, she started off small with a plan to build a delivery business.


Grant had lived for more than a decade in an over-policed part of East Oakland. But proving residency was easier said than done. Grant had never had property records because she had never owned land. She couldn’t obtain housing or utility records going back more than a decade because those agencies hadn’t kept records that long. Moreover, when it came to proving her income, she had no pay stubs or W2 forms to show city officials.

“I didn’t have that stuff,” Grant says. “Real equity applicants don’t have that kind of stuff.”

Since May 2017, Oakland officials have received nearly 800 cannabis permit applications. More than half are equity applicants like Grant. And while the vast majority have been approved, it has not always been easy to navigate the obstacle course of municipal bureaucracy. This is where the Hood Incubator’s assistance has extended well beyond providing high-end advice on launching a startup. For instance, Grant doesn’t own a printer, but needed to drop off a paper copy of her permit application at City Hall. So Ifedigbo let her use the one at the Hood Incubator’s tiny downtown office. Martin has also arranged for pro bono work from consultants and lawyers, so the program’s fellows can spend their money on other startup costs.


But the most valuable service the Hood Incubator has provided to the equity applicants is to help them overcome a lack of formal business training. Before becoming a fellow, Dejah Fortune had nearly two decades of experience making salts, lotions and oils— including a cannabis-infused product to treat his grandmother’s arthritis—but he had little idea how to pique investors’ interest. He got help tailoring his pitch to identify a specific market (health-conscious cannabis patients), products (organic high-quality cannabis extracts) and funding needs ($25,000). Esteban Orozco, who’d worked as a nutrition coach, had never read a financial statement, much less written one. The program taught him how to “pivot” from his original business idea—a line of cannabis-infused vegan edibles—to one that teaches cannabis newcomers how to integrate pot into a healthy diet.

“It gave me a lot of confidence,” said Aanya Gamble Hill, a former University of California-San Francisco employee whose startup, A+ Collective, delivers cannabis products throughout Oakland and caters specifically to seniors. “I left thinking, ‘I could probably do this.’”


The Hood Incubator hasn’t just rolled out a niche program serving a handful of entrepreneurs. It has built a network of more than 2,000 members—some paying $1,000 a yearfor newsletters, clinics and webinars. Half of those come from California; the other half from cities as far away as Atlanta (which sits in a state that prohibits the growing or sale of medical marijuana) and New York. As Ifedigbo notes: “You're going to get much farther along in this industry if you're well-connected to the people who help write the laws, issue the permits, or other entrepreneurs within the space who are on the same trajectory as you.” They’ve also created apprenticeships through established companies so that black and Latino residents can be trained on the technical side of the industry.

But James Anthony, a local cannabis attorney, believes the biggest hurdle is the lack of capital available to black and Latino entrepreneurs, even as investors poured nearly $2 billion into the cannabis industry during the first two months of 2018, a roughly fourfold increase compared with the same period the year before. “If there’s no wealth in your community, and if you don’t solve that problem, you’re going to have a [higher] failure rate,” he says. Likewise, well-funded companies seeking permits have started making cash offers—including some that are five or six figures—to people who are eligible to get equity permits in exchange for them becoming token stakeholders who stay out of the daily operations.


“The intentions of a lot of people getting licensed in the Bay Area is more about money than cultural healing,” Fortune says. “People with access to resources, who are jumping ship from their current careers, have never smoked. There’s a disconnect.”

To offset some disparities regarding access to capital, Oakland has allowed larger companies who don’t immediately win “general” permits to get one by providing an equity applicant with rent-free space of at least 1,000 square feet for three years. Those companies could lose the permit, however, if the businesses they’re incubating fail. Beyond that, Greg Minor, assistant to Oakland's city administrator, says the city will soon make available $3.4 million in interest-free loans to equity applicants.

After Linda Grant obtained her permits in January, she created an account on a city website that resembles a dating app to match investors with entrepreneurs. One potential backer offered $50,000 if she would agree to be a hands-off partner. She rejected it. Ultimately, two men behind an edible company called GummiCares offered her 1,500 square feet of space in their squat warehouse 15 minutes from her duplex. Grant clicked with one of GummiCares’ co-founders, Curtis Ohlson, a bass player who once toured with Ray Charles. Ohlson wanted to help Grant fulfill her dream of opening a dispensary. But first, they’d work on launching her delivery business, which requires less seed money than a dispensary.

“Before, cannabis suppressed her life,” Ohlson says. “Hopefully, now, cannabis will uplift her family’s life.”

***


Next month, Ifedigbo and Martin will announce the next class of Hood Incubator fellows, planting the seeds for dozen or so more cannabis startups to flourish. Of the Hood Incubator’s 10 graduates in 2017, six are still pursuing their business concepts. But the rest are employed in the industry. Ifedigbo says the Hood Incubator graduation rate, around two-thirds of its accepted fellows, is comfortably on par with other kinds of business accelerators.

Now the duo is taking on a broader mission to help other cities follow Oakland’s lead. Ifedigbo says elected officials and academics, hearing about the nonprofit’s work by word of mouth, have reached out for advice. In recent months, officials in Sacramento and San Francisco have looked into creating similar programs. The Hood Incubator’s work was even cited in a case study for the city of Los Angeles as officials there look to build their own equity program.

Keith Stephenson, for many years the only black dispensary owner in Oakland, fears the rising costs of breaking into the cannabis industry business might limit the impact of equity programs. He ultimately hopes these kinds of permitting measures, which he supports, don’t just lead to “photo-op moments.” Anthony, the cannabis attorney, thinks permitting reforms may have the unintended consequence of driving some minority-owned cannabis entrepreneurs out of operation. He believes Oakland’s equity program is “well-intentioned,” but, when asked whether the program would lead to an increase of black and Latino cannabis businesses, he replied: “It’s probably a wash.”



In response, Martin says the equity program wasn’t designed to help those most likely to succeed: “It’s there to help those most impacted by the war on drugs. If we wanted to help the most likely to make it, we’d be targeting a different group [with our services.]”

No matter how far the idea spreads, Ifedigbo and Martin do not expect equity permitting will correct all the wrongs caused by the war of drugs. But it could begin to erase arrest rate disparities and spur legal changes, such as the recent decision by the Alameda County district attorney to start dismissing thousands of pot convictions dating from the 1970s. Ifedigbo hopes the data will someday show that “everyone has an equal opportunity to not only enter the industry but thrive and be sustainable in the industry.”


Grant is waiting for those seeds of change to bloom—slowly. As GummiCares renovates what will soon be Herbin Collective’s headquarters, she is now training her fleet of four delivery drivers and negotiating with a supplier from Santa Cruz. Her drivers, who include friends and a nephew, aren’t the only ones waiting to see if cannabis truly helps their community.

Her 23-year-old daughter, Makala, was inspired to apply to the Hood Incubator’s accelerator program. The young college dropout is now perfecting her edible recipes, including a weed-infused banana pudding topped with Chessman shortbread cookies, for her business that she plans to call Majic, a nod to the #BlackGirlMagic movement that celebrates the beauty and resilience of black women. Like her mother, she sees her business as more than just an income stream.

“I want to make hella money,” Makala says. “But I want to focus on healing people, too.”


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http://so-l.ru/news/y/2018_03_27_legal_pot_is_notoriously_white_oakland Tue, 27 Mar 2018 12:03:56 +0300
<![CDATA[Ameriprise Financial Continues To Push Consumers To Be Brilliant]]> http://so-l.ru/news/y/2018_01_22_ameriprise_financial_continues_to_push_c Mon, 22 Jan 2018 23:58:00 +0300 <![CDATA[How To Restructure Your Investments For Retirement]]> http://so-l.ru/news/y/2017_11_14_how_to_restructure_your_investments_for Tue, 14 Nov 2017 23:39:00 +0300 <![CDATA[15 Retirement Statistics That Will Scare the Crap Out of You]]> Scream scene

Scary retirement statistics | Source: Dimension Films

America’s retirement crisis is the most gruesome wreck you’ll find on Main Street. Victims happen every day amid a financial bloodbath of too much debt, not enough savings, and stalled wages. We can’t look away — nor should we. More than ever, you need to prepare for a time when you’ll want or need to retire.

In 1974, Congress passed the Employee Retirement Income Security Act and the IRA was introduced. Four years later, the IRS added a paragraph to the tax code, which led to the first 401(k) in 1981. Today, IRA and 401(K) retirement accounts have replaced pensions, with a downside: They are do-it-yourself retirement plans. When faced with the decision to save for retirement, individuals often make the default or “no decision” choice. But participants must take action to save for a voluntary retirement plan, so the “no decision” choice is a decision not to save.

This is slowly changing as more employers automatically enroll workers into 401(k) plans. But if you need a good scare to jumpstart your retirement plan, we’ve assembled a list of 15 retirement statistics that will scare the crap out of you — and hopefully get you thinking about saving more.

1. Nothing saved for retirement

Your mama may have told you to be happy with what you’ve got, but that isn’t much if we’re talking about retirement savings. A recent survey from GoBankingRates.com finds more than half of Americans have less than $10,000 saved for retirement, with one in three having nothing saved. The National Institute on Retirement Security estimates the nation’s retirement savings gap is between $6.8 and $14 trillion.

Exactly how much you need to save for retirement is an ongoing debate, but one thing is clear: You’ll need more than nothing.

Next: These are even worse than airline fees.

2. Fees can rob your retirement blind

Retirement fees

Retirement fees | Source: FutureAdvisor

Life is full of fees: convenience fees, installation fees, cancellation fees, ATM fees, checked-bag fees, it never ends. These fees are usually expressed in dollar signs, unless we’re talking about investing fees. Wall Street has some of the most elusive fee disclosures. Instead of dollar signs, expense ratios (the most common fees in retirement accounts) are expressed as percentages.

For example, an expense ratio of 1.25% seems low but in terms of dollars, that fee will cost you $125 annually for every $10,000 invested. Compounded over time, that adds up to staggering amounts. Making matters worse, you don’t see the fee subtracted from your balance statement. Instead, it’s subtracted from your market returns before your statement is even made.

FutureAdvisor calculates how different expense ratios affect two identical 401(k) portfolios starting at $10,000, and receiving the maximum annual contribution for 40 years. The first portfolio has an expense ratio of only 0.25%. It reaches a value of $1.49 million, with $80,985 in lifetime fees paid. The second portfolio has an expense ratio of 1.25%. It reaches a value of $1.21 million. That’s still a nice payday, but lifetime fees total a whopping $357,488. You could’ve saved $276,503 by simply choosing a low-cost fund (all other things equal).

Lesson learned: Pay attention to fees. If you notice an abundance of high-cost funds in your 401(k), talk to your employer about switching providers. Many employers do care about their employees’ retirement options. Examples of low-cost providers include Ubiquity, Employer Fiduciary, and Vanguard.

Next: This generation experiences a lot of financial regret.

3. Baby Boomers wish they’d done things differently

Man takes a swing

Man takes a swing | Source: iStock

As a whole, Baby Boomers are not ready for retirement. According to a survey by the Insured Retirement Institute, 76% of Baby Boomers are not confident that they have enough saved for retirement. Of those lacking confidence, 68% wish they’d saved more and 67% would’ve started saving earlier. More than half of Baby Boomers said they need Social Security to make it through their retired years.

These findings may surprise you; the Baby Boomer generation is famously hard-working and self-reliant. Known for being goal-oriented, they’ll likely remain focused on their retirement goals throughout their golden years. We’ll let this be a lesson for Millennials.

Next: A forced retirement doesn’t just happen to professional athletes.

4. You might not retire on your own terms

Arian Foster

Arian Foster retires early after a string of injuries | Maddie Meyer/Getty Images

Not everyone will be able to work well into their 80s like Warren Buffett, or well into their 90s like his right-hand man Charlie Munger. Gallup finds the average retirement age is 62. This corresponds with the Center for Retirement Research at Boston’s research that finds the average retirement age is about 64 for men and 62 for women.

Retiring when you’re physically and financially able to enjoy life is great news, but that’s not always the case. In fact, 55% of retirees actually retired earlier than expected, with health reasons cited as the No. 1 reason, followed by job loss. The third of workers expecting to never retire are in for a rude awakening. Don’t count on being able to work longer to make up for a lack of savings.

Next: Few retirees can escape this expense.

5. Healthcare costs are sickening in retirement

Source: iStock

Health care is expensive | iStock.com

Health truly equals wealth in retirement. Research from Fidelity says a couple that retired in 2015, both aged 65, will spend an estimated $245,000 on healthcare throughout retirement. That’s up from $220,000 in 2014 and $190,000 in 2005. Longer life expectancy and anticipated annual increases for medical and prescription expenses are the primary factors raising the bill.

“The sticker shock of $245,000 hopefully reinforces for many people that they need to act now, regardless of their age,” said Brad Kimler, executive vice president of Fidelity’s Benefits Consulting Services, in a press release. “For people offered a high-deductible health plan with a health savings account at work, choosing this option can really help them prepare, especially for Millennials who have a long time to save.”

Next: Not taking advantage of this benefit is basically throwing away money.

6. Millions miss out on “free” retirement money

Source: NRCC

Burning money | NRCC

We need all the help we can get when it comes to saving for retirement. Unfortunately, millions of Americans don’t do themselves any favors. According to Financial Engines, an independent investment advisor, one quarter of employees are not saving enough money to receive their employer’s 401(k) match. On average, those employees miss out on an extra $1,336 a year, or a little less than an extra $25 a week. Overall, Americans are losing an estimated $24 billion annually in matching contributions.

It gets worse. Retirement savers also leave money on the table with the Saver’s Credit. Only 25% of American workers with annual household incomes of less than $50,000 are aware of the tax credit, which is a benefit available to low- and moderate-income workers saving for retirement. The credit reduces a taxpayer’s federal income tax and may be applied to the first $2,000 ($4,000 if married and filing jointly) of voluntary contributions an eligible worker makes to a 401(k), 403(b), or similar employer-sponsored retirement plan, or an individual retirement account (IRA).

It’s not always easy to contribute to your retirement accounts, but nobody cares about your future self like you.

Next: Don’t let finances keep you up at night.

7. You’ll likely lose sleep worrying about retirement

Man and woman sleep in bed

Man and woman rest easy in retirement. | Source: iStock

If you have a solid, clear financial plan for your future, you’ll rest easy. Those who feel ashamed, guilty, or embarrassed about retirement? No so much, according to a study by Ramsey Solutions. About 56% of Americans lose sleep when they think about retirement. Most of these people cite anxiety as the main feeling they equate to with their financial future.

So, in this case, ignorance is not bliss. The more you plan and save for retirement, the more sleep you’ll get. (“Less than half of Americans who feel excited or confident about their future say they lose sleep over retirement,” according to Ramsey Solutions’ research.)

Next: Educate yourself in more ways than one.

8. Student loans could haunt your golden years

Source: iStock

College degrees cost money, sometimes too much | iStock.com

Millennials know all too well the financial burden of college debt. Recent findings from the LIMRA Secure Retirement Institute reveal that millennials who start their careers with $30,000 in student loans could have $325,000 less in retirement savings compared to debt-free peers. This is a fairly typical debt load for students. In 2015, the average student loan debt totaled $33,000, compared to $10,000 in 1990.

Debt isn’t always terrible. In fact, debt can be a wise investment if it leads to a significant increase in your earning potential. The trick is researching career options and understand how to reduce what you spend on a college degree. Financial aid, scholarships, technical degrees, and community colleges may help dampen the impact of education costs. At least six different student loan forgiveness programs can help you erase college debt.

Next: Women need a retirement plan more than ever.

9. Women are less prepared for retirement

A businesswoman is stressed.

A businesswoman is stressed. | iStock.com

Women are significantly less likely to save for retirement. The gap between men’s and women’s retirement savings equates to as much as 26% according to a report by GoBankingRate. (This widens as men and women’s balances get higher.) The women surveyed contributed to findings that state they’re 27% more likely than men to have no retirement saving. Nearly two-thirds of women have nothing saved or less than $10,000 in retirement savings (compared to 52% of men).

Many factors affect women’s abilities to save. It’s harder for women to save in general, as they earn less than men (making $0.79 for every dollar men make in full-time positions). Additionally, women often take time out of the workforce to raise children or care for elderly parents. During those times they may not be able to contribute to retirement savings. In all, women must save 18% while men need to save 10% to reach the same financial level in retirement.

Next: Are you smarter than a … financial advisor?

10. Financial literacy took a detour

dumb and dumber

Dumb money moves will cost you | New Line Cinema

I’m reminded of a quote from Mickey Mantle: “It’s unbelievable how much you don’t know about the game you’ve been playing all your life.”

It’s unbelievable how much people don’t know about something they try to acquire all their lives. Standard & Poor’s interviewed over 150,000 adults in more than 140 countries to gauge global financial literacy. The results are painful. Only 33% of adults worldwide can correctly answer at least three out of four financial concepts involving risk diversification, inflation, numeracy, and compound interest. That means 3.5 billion adults globally, most in developing economies, lack an understanding of basic financial concepts.

A lack of understanding creates an abundance of uncertainty and stress, which helps explain why 60% of employees report feeling somewhat or very stressed about their financial situations, or why 62% of millennials want a financial advisor to walk them through every step of the retirement planning process.

Next: Financial patience is a virtue, too.

11. The market can be slow sometimes

Money and plants growing

Money takes a while to grow | iStock.com/RomoloTavani

The stock market has three directions: up, down, and sideways. If investing in stocks is part of your retirement plan, building wealth can feel slow when the market isn’t ascending in a nice, straight line. Your retirement balances may even go backward from time to time.

Fidelity’s analysis of retirement accounts reveal that average balances dipped in the beginning of 2016. The average 401(k) balance fell from $91,800 in the first quarter of 2015 to $87,300 in the first quarter of 2016. The average IRA balance fell from $94,100 to $89,300 over the same period. These declines are due to the stock market’s worst new-year start in history, which is why it’s vital that you regard investing as a multi-decade process, and not get caught up in short-term volatility.

Next: Don’t make Social Security your one and only plan.

12. Social Security to become less sociable

social security building

Social Security building | Justin Sullivan/Getty Images

Nobody knows what Social Security will look like in a couple decades, but it will likely look different in some capacity. Without reform, benefits will need to be cut by 23% in aggregate in 2033, according to a recent report from the Social Security Administration. In other words, after the depletion of reserves, continuing tax income is expected to be sufficient enough to pay 77% of scheduled benefits in 2033.

Social Security is a lifeline to retirees. According to the Transamerica Center for Retirement Studies, Social Security is the most common cited source of income for retirees, with savings and investments at a distant second. The median age they started collecting benefits was 62. In fact, the Economic Policy Institute, a nonpartisan think tank, estimates that Social Security keeps nearly 27 million Americans above the poverty threshold, as gauged by the Supplemental Poverty Measure.

Next: Let’s hope for the best concerning your lifespan.

13. You might live longer than expected — and need more savings to do so

Betty White in The Golden Girls Touchstone Television

Betty White in The Golden Girls | Touchstone Television

Once you hit age 65, roughly the average retirement age, your odds of living for another decade or two is quite high. Men age 65 today have a 78% chance of living another 10 years, while women have an 85% chance, according to JPMorgan’s research. The odds of a long life increase dramatically for couples. In fact, couples age 65 today have an astounding 97% chance that at least one of them lives another 10 years and an 89% chance that one experiences their 80th birthday. It almost comes down to a coin flip that at least one person in the relationship lives to 90.

In short, you should plan on living to at least 90 or perhaps longer, depending on your family history. I once had an Ameriprise financial planner tell me he usually assumes his clients will live to be 100, just to be on the safe side.

Next: Retirement would be pretty boring without this.

14. “Fun money” is more important than it seems

couple, retirement

Couple preparing for retirement | Source: iStock

Retirement priorities may lie with healthcare concerns and basic necessities. But if you don’t save for leisure activities, you’ll find yourself in a financial conundrum nonetheless. Nearly 60% of retirees don’t budget for leisurely pursuits as they save for retirement, according to a Merrill Lynch study.

Although you may dream of learning a new skill or pursuing a hobby in retirement, it won’t happen if you don’t have the resources to do so. Factoring in entertainment expenses is crucial to a well-planned retirement. In fact, you may want to plan for even more leisurely expenses given the free time retirement allows.

Next: You don’t want to end up in this position.

15. Seniors are declaring bankruptcy at an unprecedented rate

couple talking to financial planner at home

Couple talking to a financial planner at home | iStock.com/Edward Bock

In 1991, only 2.1% of those filing for bankruptcy were 65 or older. This number climbed to 7% by 2007, a frightening number considering the more limited options seniors have for making money. This research, conducted by the Employee Benefit Research Institute, notes that “without a job or income stream to convince lenders otherwise, you may have a hard time opening credit cards, securing transportation, or renting a home as a senior if you’re forced to go this route.”

Follow Eric on Twitter @Mr_Eric_WSCS

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Read the original article from The Cheat Sheet]]>
http://so-l.ru/news/y/2017_10_31_15_retirement_statistics_that_will_scare Tue, 31 Oct 2017 02:01:00 +0300
<![CDATA[Wall Street ends at record high, led by banks; Apple weighs]]> Wall Street ends at record high, led by banks; Apple weighsThe S&P 500, Dow Jones industrials and Nasdaq Composite clocked record closes, with investors drawn to riskier assets as concerns about U.S. tensions with North Korea eased and the financial impact from Hurricane Irma appeared less severe than was feared last week. The financial sector <.SPSY> was the S&P 500's biggest driver during the regular session as bank stocks were helped by rising U.S. Treasury yields, while the utilities and real estate sectors lost ground. As long as these two issues - North Korea and the hurricane - have receded as concerns, it gives investors a green light to focus on stronger fundamentals," said David Joy, chief market strategist at Ameriprise Financial in Boston.


]]> http://so-l.ru/news/y/2017_09_12_yahoo_finance_wall_street_end Tue, 12 Sep 2017 23:34:32 +0300 <![CDATA[Wall Street ends at record high, led by banks; Apple weighs]]> Wall Street ends at record high, led by banks; Apple weighsThe S&P 500, Dow Jones industrials and Nasdaq Composite clocked record closes, with investors drawn to riskier assets as concerns about U.S. tensions with North Korea eased and the financial impact from Hurricane Irma appeared less severe than was feared last week. The financial sector (.SPSY) was the S&P 500's biggest driver during the regular session as bank stocks were helped by rising U.S. Treasury yields, while the utilities and real estate sectors lost ground. As long as these two issues - North Korea and the hurricane - have receded as concerns, it gives investors a green light to focus on stronger fundamentals," said David Joy, chief market strategist at Ameriprise Financial in Boston.


]]> http://so-l.ru/news/y/2017_09_12_wall_street_ends_at_record_high_led_by Tue, 12 Sep 2017 16:01:59 +0300 <![CDATA[Job Growth Cools, Unemployment Rate Falls To 4.5 Percent]]>





WASHINGTON, April 7 (Reuters) - U.S. job growth slowed sharply in March amid continued layoffs in the retail sector, but a drop in the unemployment rate to a near 10-year low of 4.5 percent suggested the labor market was still tightening.


Nonfarm payrolls increased by 98,000 jobs last month, the fewest since last May, Labor Department said on Friday.


Job gains, which had exceeded 200,000 in January and February, were also held back by a slowdown in hiring at construction sites, factories and leisure and hospitality businesses, which had been boosted by unusually warm temperatures earlier in the year.


In March, temperatures dropped and a storm lashed the Northeast, likely accounting for some of the stepback in hiring. The two-tenths of a percentage point drop in the unemployment rate from 4.7 percent in February took it to its lowest level since May 2007.


“There probably was a large weather-related factor in there during the measurement week. If you look at the underlying data outside of this singular report and the way it’s measured, the data still suggests that job growth is pretty good,” said Russell Price, senior economist at Ameriprise Financial Services in Troy, Michigan.


The dollar was trading higher against a basket of currencies, while prices for U.S. Treasuries rose. U.S. stock index futures were slightly lower.


The economy needs to create 75,000 to 100,000 jobs per month to keep up with growth in the working-age population.


While the bigger establishment survey showed fewer jobs created last month, the smaller and more volatile survey of households showed employment increased 472,000. The labor market is expected to hit full employment this year.


Economists polled by Reuters had forecast payrolls increasing 180,000 last month and the unemployment rate unchanged at 4.7 percent.


The weak payrolls gain could raise concerns about the economy’s health especially given signs that gross domestic product slowed to around a 1.0 percent annualized growth pace in the first quarter after rising at a 2.1 percent rate in the fourth quarter.


 


MODERATE WAGE GAINS


Average hourly earnings increased 5 cents or 0.2 percent in March after rising 0.3 percent in February. That lowered the year-on-year increase in wages to 2.7 percent.


Given rising inflation, the moderate job gains and gradual wage increases could still keep the Federal Reserve on course to raise interest rates again in June.


The U.S. central bank lifted its overnight interest rate by a quarter of a percentage point in March and has forecast two more hikes this year. The Fed has said it would look at how to reduce its portfolio of bond holdings later this year.


“I think for the Fed, it doesn’t change all that much in the near-term outlook. They were not going to go in May, and there are still going to be two more employment reports before the June meeting,” said Mark Cabana, head of U.S. short rates strategy at Bank of America Merrill Lynch in New York.


The labor force participation rate, or the share of working-age Americans who are employed or at least looking for a job, held at an 11-month high of 63 percent in March.


A broad measure of unemployment, that includes people who want to work but have given up searching and those working part-time because they cannot find full-time employment, fell to 8.9 percent, the lowest level since December 2007, from 9.2 percent in February.


The employment-to-population ratio increased one-tenth of a percentage point to 60.1 percent, the highest since February 2009.


Last month, construction jobs increased 6,000, the weakest since August, after robust gains in January and February. Manufacturing employment gained 11,000 jobs, slowing from the 26,000 positions created in February.


Retail payrolls fell 29,700, declining for a second straight month. Retailers including J.C. Penney Co Inc and Macy’s Inc have announced thousands of layoffs as they shift toward online sales and scale back on brick-and-mortar operations.


Government payrolls increased 9,000 despite a freeze on the hiring of civilian workers.


 


(Reporting by Lucia Mutikani; Additional reporting by Herb Lash and Sam Forgione in New York; Editing by Andrea Ricci)

-- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.

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http://so-l.ru/news/y/2017_04_07_job_growth_cools_unemployment_rate_fall Fri, 07 Apr 2017 16:27:26 +0300
<![CDATA[Will US Inflation Reach The Fed’s Target This Year?]]> Inflation expectations have been ticking higher lately, according to several sources, signaling that headline measures of year-over-year price indexes could reach the Federal Reserve’s 2% inflation target in 2017 for the first time in several years.

Market-based estimates of future inflation have been trending up in recent months, based on the yield spread between nominal and inflation-indexed Treasuries. The the yield spread on 10-year Treasuries, for instance, touched 1.98% on the first trading day of the year, based on daily data via Treasury.gov—close to the highest level in well over two years.

inf-f-5-10-2017-01-04

The Cleveland Fed’s inflation nowcast is even higher. The January 2017 estimate for the year-over-year change in the headline consumer price index is 2.28%, up from the 2.07% in December. The core CPI nowcast is a bit softer, but the current nowcast tops 2.0% as well. The key takeaway: this model’s anticipating that the 1.7% annual pace in headline CPI through November (the current report) will soon exceed the Fed’s 2.0% target.

That’s also the forecast via TradingEconomics.com’s econometric outlook for prices, which projects a rising trend for headline CPI’s annual changes in the months ahead.

inf-te-04jan2017

Meanwhile, prices in the manufacturing sector are posting firmer numbers lately. “Input price inflation accelerated for the third time in the past four months during December,” IHS Markit advised in yesterday’s survey update for the US. “Moreover, the latest rise in average cost burdens was the sharpest since October 2014, which manufacturers mainly linked to greater raw material prices (especially metals).”

Russell Price, senior economist at Ameriprise Financial, tells Bloomberg that he was “a little bit surprised by the strength of the increase” in the ISM price index. “We’ve seen firmer commodity prices across the board, and maybe the expectations of stronger results may be influencing responses in the survey. Headline inflation should see an acceleration.”

Despite the recent rise in inflation expectations, the market is projecting that the Fed will leave interest rates unchanged at the next monetary policy announcement on Feb. 1. Fed funds futures are pricing in a 97% probability (as of Jan. 3) that the central bank will maintain the current target rate range of 0.50% to 0.75%, according to CME data.

Nonetheless, the Fed continues to squeeze the real (inflation-adjusted) base money supply, which implies that monetary tightening is ongoing. The M0 measure of money fell 10.9% in November vs. the year-earlier level—the ninth straight month of year-over-year declines and close to the deepest slide in more than half a century.

ambsl-cpi2017-01-04

The current M0 decline follows years of extraordinarily high rates of growth, and so a fair amount of M0’s downside trend can be attributed to a mopping-up effort. Still, it’s clear that the Fed’s policy bias has shifted to a mildly hawkish stance.

Nothing’s written in stone, of course. But short of a sharp slowdown in economic growth (and/or ongoing strength in the US dollar), the rebound in inflation expectations looks set to continue and lay the groundwork for more interest rate hikes in the months ahead.

]]>
http://so-l.ru/news/y/2017_01_04_will_us_inflation_reach_the_fed_s_target Wed, 04 Jan 2017 15:01:42 +0300
<![CDATA[Ameriprise Financial downgraded to hold at SunTrust RH]]> ]]> http://so-l.ru/news/y/2016_12_19_ameriprise_financial_downgraded_to_hold Mon, 19 Dec 2016 15:56:57 +0300 <![CDATA[Four suitors submit binding bids for UniCredit's Pioneer: sources]]> ]]> http://so-l.ru/news/y/2016_11_11_four_suitors_submit_binding_bids_for_uni Fri, 11 Nov 2016 18:25:59 +0300 <![CDATA[Last pre-election jobs report: 161,000 jobs created in October]]> The final pre-election jobs report showed the economy added 161,000 jobs in October, the Labor Department reported Friday, down from 191,000 in September.

The October jobs report was in line with that of previous months and is not likely to sway the election toward Hillary Clinton or Donald Trump.

Unemployment was 4.9 percent, down from September’s 5 percent.

Average private-sector earnings were up 10 cents over September, when they rose 8 cents. Wages were up 2.8 percent over October 2015.

At the White House, the chairman of the Council of Economic Advisers, Jason Furman, said wages grew at "the fastest 12-month pace since the recovery began" and "have grown faster over the current business cycle than in any since the early 1970s."


Republicans were less impressed.

In a statement, GOP presidential nominee Donald Trump's national policy director, Stephen Miller, said the "disastrous jobs report underscores the total failures of the Obama-Clinton economy that delivers only for donors and special interests and robs working families."

And House Ways and Means Committee Chairman Kevin Brady (R-Texas) said the report "continues the slow-growth trend we’ve come to expect from the Obama Administration."

Analysts said October's jobs report was a good sign for the economy and increased the likelihood that the Federal Reserve will hike interest rates in December.

Russell Price, a senior economist at Ameriprise Financial in Detroit told Bloomberg "the pace of job growth remains pretty steady." And the report, he added, supports the idea that the opportunity is there for the Fed to raise rates, and it's certainly appropriate for them do so."

Elise Gould, senior economist at the left-leaning Economic Policy Institute, said the increase in wages was "a sign of a tightening labor market, where workers may be starting to gain some leverage." But she added the "Federal Reserve was correct not to raise interest rates this week, as the economy has been consistently hitting singles, but not hitting it out of the park."

Analysts surveyed by Bloomberg had predicted the creation of about 178,000 jobs, an unemployment rate of 4.9 percent and an increase in hourly earnings of 0.3 percent. The payroll company ADP estimated Wednesday based on its own records that October job growth in the private sector was 147,000.

The jobs report followed news from the Commerce Department last week that GDP increased 2.9 percent during the third quarter of 2016, according to an advance estimate. That’s well above the second quarter of 2016’s 1.4 percent and the first quarter of 2016’s 0.8 percent.

The Commerce Department’s second cut at estimating third quarter growth for 2016 will be released Nov. 29.


]]>
http://so-l.ru/news/y/2016_11_04_last_pre_election_jobs_report_161_000_j Fri, 04 Nov 2016 15:37:03 +0300
<![CDATA[Ameriprise Financial joins race to buy UniCredit's Pioneer: sources]]> ]]> http://so-l.ru/news/y/2016_11_03_ameriprise_financial_joins_race_to_buy_u Thu, 03 Nov 2016 19:53:04 +0300 <![CDATA[Ameriprise Financial downgraded to hold from buy at Deutsche Bank]]> ]]> http://so-l.ru/news/y/2016_10_14_ameriprise_financial_downgraded_to_hold Fri, 14 Oct 2016 16:56:30 +0300 <![CDATA[Заявки по безработице в США на минимуме за 2 месяца]]>

Число американских граждан, впервые подавших заявки на пособие по безработице, на прошлой неделе сократилось на 4 тыс. до 259 тыс., свидетельствуют данные Министерства труда США. Показатель достиг минимальной отметки за семь недель.

Опрошенные Bloomberg аналитики в среднем ожидали увеличения количества заявок до 265 тыс.

Число новых заявок упало ниже ключевой отметки (300 тыс.) в феврале 2015 г. и остается ниже этого уровня в течение 79 недель. В последний раз столь продолжительный период низкого уровня заявок был зафиксирован в 1970 г., когда трудоспособное население было намного меньше.

Данные свидетельствуют о том, что сейчас компании США стремятся удержать сотрудников на фоне нехватки квалифицированных кадров. Это, в частности, было отмечено в "Бежевой книге" - экономическом обзоре, опубликованном ранее Федеральной резервной системой (ФРС).

Среднее число заявок за последние четыре недели, менее волатильный показатель, уменьшилось с 263 тыс. до 261,25 тыс.

Количество продолжающих получать пособие по безработице жителей США за неделю, завершившуюся 27 августа, сократилось на 7 тыс. до 2,14 млн человек.

Ситуация на рынке труда США остается благоприятной, отметил старший экономист Ameriprise Financial Рассел Прайс. "Думаю, мы увидим немного более высокие темпы экономического роста во втором полугодии, это должно и дальше поддерживать спрос на рабочую силу", - добавил он.]]>
http://so-l.ru/news/y/2016_09_08_zayavki_po_bezrabotice_v_ssha_na_minimume Thu, 08 Sep 2016 16:48:00 +0300
<![CDATA[Заявки по безработице в США на минимуме за 2 месяца]]>

Число американских граждан, впервые подавших заявки на пособие по безработице, на прошлой неделе сократилось на 4 тыс. до 259 тыс., свидетельствуют данные Министерства труда США. Показатель достиг минимальной отметки за семь недель.

Опрошенные Bloomberg аналитики в среднем ожидали увеличения количества заявок до 265 тыс.

Число новых заявок упало ниже ключевой отметки (300 тыс.) в феврале 2015 г. и остается ниже этого уровня в течение 79 недель. В последний раз столь продолжительный период низкого уровня заявок был зафиксирован в 1970 г., когда трудоспособное население было намного меньше.

Данные свидетельствуют о том, что сейчас компании США стремятся удержать сотрудников на фоне нехватки квалифицированных кадров. Это, в частности, было отмечено в "Бежевой книге" - экономическом обзоре, опубликованном ранее Федеральной резервной системой (ФРС).

Среднее число заявок за последние четыре недели, менее волатильный показатель, уменьшилось с 263 тыс. до 261,25 тыс.

Количество продолжающих получать пособие по безработице жителей США за неделю, завершившуюся 27 августа, сократилось на 7 тыс. до 2,14 млн человек.

Ситуация на рынке труда США остается благоприятной, отметил старший экономист Ameriprise Financial Рассел Прайс. "Думаю, мы увидим немного более высокие темпы экономического роста во втором полугодии, это должно и дальше поддерживать спрос на рабочую силу", - добавил он.]]>
http://so-l.ru/news/y/2016_09_08_vestifinans_ekonomika_zayavki_po_bezra Thu, 08 Sep 2016 16:48:00 +0300
<![CDATA[Columbia Threadneedle suspends dealing in UK property funds]]> ]]> http://so-l.ru/news/y/2016_07_06_columbia_threadneedle_suspends_dealing_i Wed, 06 Jul 2016 19:00:53 +0300 <![CDATA[15 Retirement Statistics That Will Scare the Crap Out of You]]> Scream scene

Scary retirement statistics | Source: Dimension Films

America’s retirement crisis is the most gruesome wreck you’ll find on Main Street. Victims happen every day amid a financial bloodbath of too much debt, not enough savings, and stalled wages. We can’t look away — nor should we. More than ever, you need to prepare for a time when you’ll want or need to retire.

In 1974, Congress passed the Employee Retirement Income Security Act and the IRA was introduced. Four years later, the IRS added a paragraph to the tax code, which led to the first 401(k) in 1981. Today, IRA and 401(K) retirement accounts have replaced pensions, with a downside: They are do-it-yourself retirement plans. When faced with the decision to save for retirement, individuals often make the default or “no decision” choice. But participants must take action to save for a voluntary retirement plan, so the “no decision” choice is a decision not to save.

This is slowly changing as more employers automatically enroll workers into 401(k) plans. But if you need a good scare to jumpstart your retirement plan, we’ve assembled a list of 15 retirement statistics that will scare the crap out of you — and hopefully get you thinking about saving more.

1. Nothing saved for retirement

Your mama may have told you to be happy with what you’ve got, but that isn’t much if we’re talking about retirement savings. A recent survey from GoBankingRates.com finds more than half of Americans have less than $10,000 saved for retirement, with one in three having nothing saved. The National Institute on Retirement Security estimates the nation’s retirement savings gap is between $6.8 and $14 trillion.

Exactly how much you need to save for retirement is an ongoing debate, but one thing is clear: You’ll need more than nothing.

Next: These are even worse than airline fees.

2. Fees can rob your retirement blind

Retirement fees

Retirement fees | Source: FutureAdvisor

Life is full of fees: convenience fees, installation fees, cancellation fees, ATM fees, checked-bag fees, it never ends. These fees are usually expressed in dollar signs, unless we’re talking about investing fees. Wall Street has some of the most elusive fee disclosures. Instead of dollar signs, expense ratios (the most common fees in retirement accounts) are expressed as percentages.

For example, an expense ratio of 1.25% seems low but in terms of dollars, that fee will cost you $125 annually for every $10,000 invested. Compounded over time, that adds up to staggering amounts. Making matters worse, you don’t see the fee subtracted from your balance statement. Instead, it’s subtracted from your market returns before your statement is even made.

FutureAdvisor calculates how different expense ratios affect two identical 401(k) portfolios starting at $10,000, and receiving the maximum annual contribution for 40 years. The first portfolio has an expense ratio of only 0.25%. It reaches a value of $1.49 million, with $80,985 in lifetime fees paid. The second portfolio has an expense ratio of 1.25%. It reaches a value of $1.21 million. That’s still a nice payday, but lifetime fees total a whopping $357,488. You could’ve saved $276,503 by simply choosing a low-cost fund (all other things equal).

Lesson learned: Pay attention to fees. If you notice an abundance of high-cost funds in your 401(k), talk to your employer about switching providers. Many employers do care about their employees’ retirement options. Examples of low-cost providers include Ubiquity, Employer Fiduciary, and Vanguard.

Next: This generation experiences a lot of financial regret.

3. Baby Boomers wish they’d done things differently

Man takes a swing

Man takes a swing | Source: iStock

As a whole, Baby Boomers are not ready for retirement. According to a survey by the Insured Retirement Institute, 76% of Baby Boomers are not confident that they have enough saved for retirement. Of those lacking confidence, 68% wish they’d saved more and 67% would’ve started saving earlier. More than half of Baby Boomers said they need Social Security to make it through their retired years.

These findings may surprise you; the Baby Boomer generation is famously hard-working and self-reliant. Known for being goal-oriented, they’ll likely remain focused on their retirement goals throughout their golden years. We’ll let this be a lesson for Millennials.

Next: A forced retirement doesn’t just happen to professional athletes.

4. You might not retire on your own terms

Arian Foster

Arian Foster retires early after a string of injuries | Maddie Meyer/Getty Images

Not everyone will be able to work well into their 80s like Warren Buffett, or well into their 90s like his right-hand man Charlie Munger. Gallup finds the average retirement age is 62. This corresponds with the Center for Retirement Research at Boston’s research that finds the average retirement age is about 64 for men and 62 for women.

Retiring when you’re physically and financially able to enjoy life is great news, but that’s not always the case. In fact, 55% of retirees actually retired earlier than expected, with health reasons cited as the No. 1 reason, followed by job loss. The third of workers expecting to never retire are in for a rude awakening. Don’t count on being able to work longer to make up for a lack of savings.

Next: Few retirees can escape this expense.

5. Healthcare costs are sickening in retirement

Source: iStock

Health care is expensive | iStock.com

Health truly equals wealth in retirement. Research from Fidelity says a couple that retired in 2015, both aged 65, will spend an estimated $245,000 on healthcare throughout retirement. That’s up from $220,000 in 2014 and $190,000 in 2005. Longer life expectancy and anticipated annual increases for medical and prescription expenses are the primary factors raising the bill.

“The sticker shock of $245,000 hopefully reinforces for many people that they need to act now, regardless of their age,” said Brad Kimler, executive vice president of Fidelity’s Benefits Consulting Services, in a press release. “For people offered a high-deductible health plan with a health savings account at work, choosing this option can really help them prepare, especially for Millennials who have a long time to save.”

Next: Not taking advantage of this benefit is basically throwing away money.

6. Millions miss out on “free” retirement money

Source: NRCC

Burning money | NRCC

We need all the help we can get when it comes to saving for retirement. Unfortunately, millions of Americans don’t do themselves any favors. According to Financial Engines, an independent investment advisor, one quarter of employees are not saving enough money to receive their employer’s 401(k) match. On average, those employees miss out on an extra $1,336 a year, or a little less than an extra $25 a week. Overall, Americans are losing an estimated $24 billion annually in matching contributions.

It gets worse. Retirement savers also leave money on the table with the Saver’s Credit. Only 25% of American workers with annual household incomes of less than $50,000 are aware of the tax credit, which is a benefit available to low- and moderate-income workers saving for retirement. The credit reduces a taxpayer’s federal income tax and may be applied to the first $2,000 ($4,000 if married and filing jointly) of voluntary contributions an eligible worker makes to a 401(k), 403(b), or similar employer-sponsored retirement plan, or an individual retirement account (IRA).

It’s not always easy to contribute to your retirement accounts, but nobody cares about your future self like you.

Next: Don’t let finances keep you up at night.

7. You’ll likely lose sleep worrying about retirement

Man and woman sleep in bed

Man and woman rest easy in retirement. | Source: iStock

If you have a solid, clear financial plan for your future, you’ll rest easy. Those who feel ashamed, guilty, or embarrassed about retirement? No so much, according to a study by Ramsey Solutions. About 56% of Americans lose sleep when they think about retirement. Most of these people cite anxiety as the main feeling they equate to with their financial future.

So, in this case, ignorance is not bliss. The more you plan and save for retirement, the more sleep you’ll get. (“Less than half of Americans who feel excited or confident about their future say they lose sleep over retirement,” according to Ramsey Solutions’ research.)

Next: Educate yourself in more ways than one.

8. Student loans could haunt your golden years

Source: iStock

College degrees cost money, sometimes too much | iStock.com

Millennials know all too well the financial burden of college debt. Recent findings from the LIMRA Secure Retirement Institute reveal that millennials who start their careers with $30,000 in student loans could have $325,000 less in retirement savings compared to debt-free peers. This is a fairly typical debt load for students. In 2015, the average student loan debt totaled $33,000, compared to $10,000 in 1990.

Debt isn’t always terrible. In fact, debt can be a wise investment if it leads to a significant increase in your earning potential. The trick is researching career options and understand how to reduce what you spend on a college degree. Financial aid, scholarships, technical degrees, and community colleges may help dampen the impact of education costs. At least six different student loan forgiveness programs can help you erase college debt.

Next: Women need a retirement plan more than ever.

9. Women are less prepared for retirement

A businesswoman is stressed.

A businesswoman is stressed. | iStock.com

Women are significantly less likely to save for retirement. The gap between men’s and women’s retirement savings equates to as much as 26% according to a report by GoBankingRate. (This widens as men and women’s balances get higher.) The women surveyed contributed to findings that state they’re 27% more likely than men to have no retirement saving. Nearly two-thirds of women have nothing saved or less than $10,000 in retirement savings (compared to 52% of men).

Many factors affect women’s abilities to save. It’s harder for women to save in general, as they earn less than men (making $0.79 for every dollar men make in full-time positions). Additionally, women often take time out of the workforce to raise children or care for elderly parents. During those times they may not be able to contribute to retirement savings. In all, women must save 18% while men need to save 10% to reach the same financial level in retirement.

Next: Are you smarter than a … financial advisor?

10. Financial literacy took a detour

dumb and dumber

Dumb money moves will cost you | New Line Cinema

I’m reminded of a quote from Mickey Mantle: “It’s unbelievable how much you don’t know about the game you’ve been playing all your life.”

It’s unbelievable how much people don’t know about something they try to acquire all their lives. Standard & Poor’s interviewed over 150,000 adults in more than 140 countries to gauge global financial literacy. The results are painful. Only 33% of adults worldwide can correctly answer at least three out of four financial concepts involving risk diversification, inflation, numeracy, and compound interest. That means 3.5 billion adults globally, most in developing economies, lack an understanding of basic financial concepts.

A lack of understanding creates an abundance of uncertainty and stress, which helps explain why 60% of employees report feeling somewhat or very stressed about their financial situations, or why 62% of millennials want a financial advisor to walk them through every step of the retirement planning process.

Next: Financial patience is a virtue, too.

11. The market can be slow sometimes

Money and plants growing

Money takes a while to grow | iStock.com/RomoloTavani

The stock market has three directions: up, down, and sideways. If investing in stocks is part of your retirement plan, building wealth can feel slow when the market isn’t ascending in a nice, straight line. Your retirement balances may even go backward from time to time.

Fidelity’s analysis of retirement accounts reveal that average balances dipped in the beginning of 2016. The average 401(k) balance fell from $91,800 in the first quarter of 2015 to $87,300 in the first quarter of 2016. The average IRA balance fell from $94,100 to $89,300 over the same period. These declines are due to the stock market’s worst new-year start in history, which is why it’s vital that you regard investing as a multi-decade process, and not get caught up in short-term volatility.

Next: Don’t make Social Security your one and only plan.

12. Social Security to become less sociable

social security building

Social Security building | Justin Sullivan/Getty Images

Nobody knows what Social Security will look like in a couple decades, but it will likely look different in some capacity. Without reform, benefits will need to be cut by 23% in aggregate in 2033, according to a recent report from the Social Security Administration. In other words, after the depletion of reserves, continuing tax income is expected to be sufficient enough to pay 77% of scheduled benefits in 2033.

Social Security is a lifeline to retirees. According to the Transamerica Center for Retirement Studies, Social Security is the most common cited source of income for retirees, with savings and investments at a distant second. The median age they started collecting benefits was 62. In fact, the Economic Policy Institute, a nonpartisan think tank, estimates that Social Security keeps nearly 27 million Americans above the poverty threshold, as gauged by the Supplemental Poverty Measure.

Next: Let’s hope for the best concerning your lifespan.

13. You might live longer than expected — and need more savings to do so

Betty White in The Golden Girls Touchstone Television

Betty White in The Golden Girls | Touchstone Television

Once you hit age 65, roughly the average retirement age, your odds of living for another decade or two is quite high. Men age 65 today have a 78% chance of living another 10 years, while women have an 85% chance, according to JPMorgan’s research. The odds of a long life increase dramatically for couples. In fact, couples age 65 today have an astounding 97% chance that at least one of them lives another 10 years and an 89% chance that one experiences their 80th birthday. It almost comes down to a coin flip that at least one person in the relationship lives to 90.

In short, you should plan on living to at least 90 or perhaps longer, depending on your family history. I once had an Ameriprise financial planner tell me he usually assumes his clients will live to be 100, just to be on the safe side.

Next: Retirement would be pretty boring without this.

14. “Fun money” is more important than it seems

couple, retirement

Couple preparing for retirement | Source: iStock

Retirement priorities may lie with healthcare concerns and basic necessities. But if you don’t save for leisure activities, you’ll find yourself in a financial conundrum nonetheless. Nearly 60% of retirees don’t budget for leisurely pursuits as they save for retirement, according to a Merrill Lynch study.

Although you may dream of learning a new skill or pursuing a hobby in retirement, it won’t happen if you don’t have the resources to do so. Factoring in entertainment expenses is crucial to a well-planned retirement. In fact, you may want to plan for even more leisurely expenses given the free time retirement allows.

Next: You don’t want to end up in this position.

15. Seniors are declaring bankruptcy at an unprecedented rate

couple talking to financial planner at home

Couple talking to a financial planner at home | iStock.com/Edward Bock

In 1991, only 2.1% of those filing for bankruptcy were 65 or older. This number climbed to 7% by 2007, a frightening number considering the more limited options seniors have for making money. This research, conducted by the Employee Benefit Research Institute, notes that “without a job or income stream to convince lenders otherwise, you may have a hard time opening credit cards, securing transportation, or renting a home as a senior if you’re forced to go this route.”

Follow Eric on Twitter @Mr_Eric_WSCS

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http://so-l.ru/news/y/2016_05_20_15_retirement_statistics_that_will_scare Fri, 20 May 2016 01:05:55 +0300
<![CDATA[Money Problems Run in the Family: Should You Blame Your Parents?]]> young couple looking at bills

Worried young couple looking at bills | Source: iStock

You got your sense of humor from your mom and your good looks from your dad, but you may have inherited something else from your parents – your problems with money. Bad financial habits often run in the family, as parents pass along their attitudes about debt, saving, and spending to their kids, sometimes unwittingly.

Forty-four percent of Americans surveyed by the National Foundation for Credit Counseling (NFCC) said they learned most of their financial lessons from their parents. Yet in a separate NFCC poll, 44% also said they’d never considered whether there was a link between their parents’ financial habits and the way they handled money. Just 12% said their parents’ money mistakes caused them to adopt financial habits that were the opposite of Mom and Dad’s.

“Whether parents are astute money managers or woefully lacking in financial skills, their behavior influences what the children are learning, and likely impacting how they will handle their own finances as adults,” Gail Cunningham, spokesperson for the NFCC, said.

In other words, if you grew up in a household where instant gratification was the norm, you may find yourself succumbing to impulse purchases as an adult. If money was always tight when you were a child, you might splurge on luxuries as an adult to make up for feeling deprived as a kid. If your parents never talked about money, you might have difficulty having financial conversations with your own partner. And that’s to say nothing of the financial advantages or disadvantages you inherit as the child of rich or poor parents.

young girl holding cash

Young girl holding $100 bills | Source: iStock

“[M]any of us have an emotionally charged relationship with money, which is shaped very early on in our lives,” financial psychologist Brad Klontz told Morningstar. “We typically learn from our parents and grandparents what money is, what it means, how to deal with it, and how to feel about it.” In his research, Klontz has found a link between the financial messages people hear as children and their later beliefs about money. Someone who was raised in a family where wealth was associated with greed is more likely to have a lower income and net worth as an adult, for example.

How long does it take kids to learn to mimic Mom and Dad’s approach to managing money? Not long. Most of our money habits are formed by age 7, a study by Cambridge University researchers found. So, yes, feel free to be a little mad at your parents for failing to teach you the right money lessons as a kid. They may be partly to blame for your current struggles with credit card debt or difficulty saving. Meanwhile, your lucky friends who were raised in homes where financial literacy was a priority are probably watching their bank account balances soar.

The money culture you were raised in has such an impact on your adult financial habits that some financial advisors make it a point to ask questions about it when they meet with you. For them, understanding the financial lessons a person learned in their formative years is as important as looking at their 401(k) balance and credit card statements.

“I ask them to recall how they grew up with money. I want to understand how they learned about money, how money values were communicated to them,” Jim Stoops, now with Carlyon Family Wealth Management, told the Chicago Tribune. Realizing what drives financial missteps like overspending or investing too conservatively can help people eventually break those bad habits.

father teaching his son about money

Father teaching his son about money | Source: iStock

“Until we understand our family money background, we may not be able to take charge of our own financial destiny,” Lori Sackler, the author of The M Word: The Money Talk Every Family Needs to Have About Wealth and Their Financial Future, told Ameriprise Financial.

Still, you can’t lay the blame for all your dumb financial moves at the feet of Mom and Dad (even those who had the best teachers can still make money mistakes, after all). Being raised in a home where finances were shaky isn’t a blanket excuse for your own money management errors. Once you recognize your own bad financial habits, you can take responsibility for educating yourself about financial matters and changing your approach to money. You may even be able to break the cycle of bad financial behavior and give your own kids the leg up you didn’t have.

“By getting accurate, unbiased knowledge and advice, people can feel empowered and confident in their personal finance decisions,” AJ Smith, vice president of content strategy and managing editor of SmartAsset told Go Banking Rates. “They can then take steps to make a better financial future.”

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http://so-l.ru/news/y/2016_05_10_money_problems_run_in_the_family_should Tue, 10 May 2016 17:31:35 +0300
<![CDATA[2.607 Days Later, The "Most Hated Bull Market Ever" Is Now The Second Longest In History]]> It's official: as of today the bull market that has been mocked as fake, doomed and history’s most-hated just earned a new title: the second-longest ever. And it only took $14 trillion in central bank liquidity, a global, coordinated central bank "put", central banks purchases of Treasuries, MBS, ETFs and corporate bonds,  and nearly 700 rate cuts in the past 7 years to achieve it.

The stock market advance that started seven weeks after Barack Obama's first inauguration, and specifically with Obama's historic March 3, 2009 remark in which he said that "what you're now seeing is, profit and earning ratios are starting to get to the point where buying stocks is a potentially good deal if you've got a long term perspective on it," has now lasted 2,607 days. 

Since then it has dodged and waved through three 10% drops in the last 19 months while avoiding the 20% decline that denotes a bear market. That matches a rally from 1949 to 1956 which straddled the presidencies of Harry Truman and Dwight D. Eisenhower. Only the dot-com bubble of the 1990s lasted longer at 3,452 days.

That means if central banks wish to inject another $14 trillion or so in liquidity to extend the duration of this "most fate, most hated" bull "market", they will need to last another 845 days, or roughly another two and a half years, to make the current rally the longest ever without a bear market.

AS Bloomberg writes it may be an uphill battle: "the rally is showing signs of fatigue: for the first time its rolling 12-month return is negative, and companies in the Standard & Poor’s 500 Index are reporting their worst profits in six years. At the same time, economists are steadily downgrading their growth forecasts, the international outlook is much worse and investors are pulling money from equities at an unprecedented rate."

However, as Bloomberg also writes: "The Federal Reserve and other central banks have shown time and again that they stand ready to inject more cash into the financial system at the first sign of market turbulence."

Just in case anyone wonders why it is the "most-hated rally" (which it isn't as participation, if only from companies buying back their stock, is at an all time high).

Some are puzzled by the general reluctance to embrace central planning: "I don’t remember another post-war bull market that was this fearful, chronically and persistently,” said Jim Paulsen, the Minneapolis-based chief investment strategist at Wells Capital Management Inc., which oversees $337 billion. Investors are “forever prepared for the end of the world, but reluctantly being dragged back into to equities."

Perhaps Paulsen should thank Yellen et al. company for disconnecting the world's once upon a time most forward looking, most efficient discounting mechanism from all fundamentals.  And yes, that's a fact: the New Yorker writer John Brooks’ chronicle of the 1950s bull market is called “The Seven Fat Years,” a title few people would apply to America since the financial crisis. In truth, the signature characteristic of the Obama bull market has been its ability to soar above an economy going nowhere, returning 3.7 percent a quarter on average since March 2009, compared with a 0.9 percent gain in gross domestic product. That gap is the widest ever.

Meanwhile, despite relentless central bank intervention, the rally may be topping out. Stocks are stuck in their longest period of stasis since the rally began, going 11 months without posting a 52-week high. Fallow periods lasting longer than 12 months are poison to chart analysts, who view them as an indication of waning momentum over the long term. In the past, deep losses have not only signaled the end of bull markets but also foretold recessions.

As Bloomberg writes, a study by Leuthold Weeden Capital Management LLC showed that since World War II, the S&P 500’s rolling 12-month returns adjusted for inflation have averaged minus 9 percent at the economy’s peak. The measure reached minus 9.6 percent in February.

Another curious characteristic of the "bull market" - it's been driven by... selling?

Americans have been sellers of equities since 2007, slashing stock holdings by $2 trillion, data compiled by Fundstrat Global Advisors LLC show. While the pace of the liquidation is unprecedented since 1956, that represents a huge pool of potential demand, according to Tom Lee, the firm’s managing partner. Investors’ exodus during the decade that started in 1979, the year when BusinessWeek featured a cover story titled “The Death of Equities,” preceded a 400 percent rally in the 1990s.

 

* * *

So what happens next? Well, at the end of the day just two things matter: interest rates and corporate profits. While central banks are firmly determined to push rates as low as possible to expand multiples to record levels, they are having trouble with profits. Indeed, Bloomberg concludes that it may all boil down to earnings. More importantly, corporate earnings are in the midst of the fourth consecutive quarter of declines as weakness from energy spread to all but three industries. The trajectory of profits will determine the path of stocks going forward, according to David Joy, the Boston-based chief market strategist at Ameriprise Financial. “A lot of reasons to hate this expansion and bull market, and yet it keeps on going,” said Joy. “Certainly most of the money has been made. Certainly we’re closer to the end than the beginning. There is probably some chance that we see higher prices down the road, but all depends on earnings.”

Golf clap central bankers.

* * *

Finally, here are some thoughts on what happens next and can the second longest bull market become the longest ever, courtesy of BofA's Michael Hartnett.

The Path from No. 2 to No. 1

  • First, the last years of the longest ever equity bull market (i.e. the late-90s) were marked by cross-asset volatility and a bubble; that remains a plausible risk scenario.

  • Second, this bull market is trading more like the mid-50s bull market which slowly exhausted itself and then reversed for a year or two as the investment cycle moved to “overheating” in 1956-57 and then brief “recession” in 1956-57. Note how asset markets have struggled to produce upside since the era of excess liquidity came to an end and/or illustrates how low expected returns of bills, bonds, equities, and indeed all risk assets have become thanks to “financial repression”. The total return from a portfolio of equities, bonds, commodities, cash split percentage-wise 50/35/10/5 from the secular lows of 2009 to the end of QE3 in October 2014 of an investment of $100 would have grown to $198. Since the end of QE3 the same portfolio would have fallen 3.4% to a value of $192. Note this also shows a diminishing “wealth effect” for the economy, another reason to be long Main Street, short Wall Street.

  • Third, another factor behind the fatigue is earnings, which as the following chart shows, have also faded in recent quarters (even excluding the energy sector). Our shift in recent years from “raging bull” to “sitting bull” to “volatility bull” reflects low probability of the Higher EPS & Lower Rates in coming quarters.

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http://so-l.ru/news/y/2016_04_28_2_607_days_later_the_most_hated_bull_m Thu, 28 Apr 2016 14:57:45 +0300
<![CDATA[Ameriprise Financial started at buy with $115 stock price target at SunTrust RH]]> ]]> http://so-l.ru/news/y/2016_03_23_ameriprise_financial_started_at_buy_with Wed, 23 Mar 2016 13:40:16 +0300 <![CDATA[How to Prepare Your Finances for a Home Purchase]]>

Source: iStock

A home is one of the most significant purchases you’ll make. That’s why it will be important to make sure you have all the information you need. The Cheat Sheet spoke with Marcy Keckler, vice president of financial advice strategy at Ameriprise Financial, for her expert tips on how to prepare your finances for a home purchase.

Also stay tuned for upcoming stories on how to negotiate a home price and tips for keeping up with mortgage payments.

The Cheat Sheet: What are some things consumers should do to get their finances in order before buying a home?

Marcy Keckler: Shopping for a new home is an exciting time and you want to be sure you start off headed in the right direction. It’s really important to set a budget and stick to it. Be realistic about what you can afford so that you don’t get in over your head. Also, consider speaking with a lender about different loan options to help determine what will work best for your financial situation.

CS: How can home buyers save up enough for the down payment?

MK: If you haven’t already, set up a savings account specifically for your house fund. Map out your current cash flow, and think about delegating a set amount from your paycheck to be transferred into the fund each month. You’ll also want to keep closing costs, interest rates, and other hidden expenses in mind when saving for a home. If you are having trouble jumpstarting your savings, track your spending and cut down on the extras. You may be surprised how much you are spending on dining out or for your daily cup of coffee; these are costs that can really add up.

monopoly houses money

Christopher Furlong/Getty Images

CS: Generally, how much should you put down on a home?

MK: It really comes down to what you can afford because every financial situation is unique. If you have the means to put down 20% or even more, I would recommend it. Otherwise you may need to put down anywhere between 5% and 20% to qualify for a loan, depending on your situation and the type of loan.

CS: What can homebuyers do to get their credit in shape before applying for a mortgage?

MK: It’s no secret that a higher credit score will qualify you for a better mortgage rate. Be diligent about keeping track of your score because it really can make a huge difference for large purchases such as a house or a car. If your score is not where you would like for it to be, it may take some time to boost it. Reducing your total debt, and making all your payments on time are key things that can add points to your score.

CS: If you have the money to purchase a home with all cash, is this usually the best way to go?

MK: When deciding to pay for a home in cash or move forward with a mortgage, there is a lot to consider. While paying in all cash will certainly look attractive to sellers and mean no future mortgage payments, you don’t want to leave yourself strapped for cash either. A mortgage could give you more liquidity should unexpected expenses come up. You’ll want to keep current interest rates and investment markets in mind because it could make more sense to invest the cash instead.

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http://so-l.ru/news/y/2016_02_02_how_to_prepare_your_finances_for_a_home Tue, 02 Feb 2016 22:12:03 +0300