Starting off 2019 here at Mackey Advisors™, we have already had numerous discussions with folks planning to retire at a date in the not too distant future. Would it surprise you to hear that every day, 10,000 boomers turn 65 in this country? Many of those folks have worked and saved for years in order to enjoy a whole new life called “retirement” after that 65th birthday. Unfortunately, all too often the ride into the sunset becomes a drive off a cliff even if they have prepared themselves to have a financially successful retirement.
As of this week, the government shutdown is now the longest in U.S. history. Granted, it is only a partial shutdown. Previous wholesale shutdowns occurred in January 2018 over immigration (specifically saving DACA-Deferred Action for Childhood Arrival) which lasted 3 days and October 2013 (over saving Obamacare) which lasted 16 days.
These prior shutdowns can be used to estimate the economic impact of the current one. According to the Office of Management and Budget, the October 2013 government shutdown lowered real GDP growth by 0.2% to 0.6% - or somewhere between $2 billion and $6 billion in lost economic output. It is estimated the current shutdown is knocking off anywhere from 0.1% to 0.5% of GDP per day. It will take quite a while for the actual impact to show up in economic stats.
Don’t get me started on the pronunciation of this month. Feb-BRuary and Feb-Uary are two very different pronunciations. One sounds like a frat-bro joke about a month-long binder, which is also the correct pronunciation, while the other sounds like gibberish. Regardless of your particular persuasion, why is this the only month with multiple pronunciations? No one skips the p in September. Let’s discuss something productive about the month of February.
Finalize your taxes
Take a new worth snapshot
Buy items on deep discount
Happy New Year everyone! While the new tax law has been in effect for over a year now, most of us will only begin experiencing it over the next few months as we prepare our 2018 taxes. Quite a bit has changed and gradually, throughout the last year we have gotten more and more info on how we might be affected.
Well, 2018’s third quarter earnings season is history. It was pretty much a repeat of both the first and second quarters. The U.S. economy will stay strong in 2019 and inflation will tick-up above 2% and so the U.S. central bank should continue to raise interest rates gradually, New York Fed President John Williams said Tuesday. “Given this outlook of strong growth, strong labor market and inflation near our goal and taking account all the various risks around the outlook, I do expect further gradual increases in interest rates will best sponsor a sustained economic expansion,” Williams said at a press briefing.
“If I could work my will, every idiot that goes about with “Merry Christmas” on his lips, should be boiled with his own pudding, and buried with a stake of holly through his heart!”…Ebenezer Scrooge
Does this sound like anyone you know? While it is from the original Charles Dickens’s, “A Christmas Carol,” I like to attribute it to my favorite Scrooge, Mr. Magoo. If you haven’t seen this hilarious animated classic, try You Tube or find the DVD. It is one of my favorite Christmas lines, but not so much because I am cranky, but because it tells a great story.
Depending on how you look at it, Scrooge either had it all or had nothing. He lived in a huge house, had a successful business, and spent his time counting his “crowns and coppers”. Of course he had time for all of this because that was all he had. His friends and loved ones had abandoned him and the townsfolk had trouble knowing whether to hate him or pity him.
Scrooge needed balance between success and happiness. At Mackey Advisors we work with clients to establish this balance every day.
People don’t realize it, but the Latin root for January (Ianua) means door. So, depending on your perspective you are either opening the door to the new year, or shutting the door on the prior year. If you are like me, it is more of a slamming the door shut and creating shock waves in the space-time continuum. Now onto the important things for the new year.
Find deep discounted items
Use a new finance app
Set a non-financial goal
It can’t get a whole lot better in the U.S. job market (or can it?). The employment situation continues blast through expectations. The number of Americans losing their jobs and applying for unemployment benefits each week remained near a 49-year low in mid-October, suggesting no visible deterioration in the U.S. labor market.
Initial jobless claims, on measure of layoffs, dropped by 5,000 to 210,000 in the seven days ended Oct. 13th. While new jobless claims edged up by 2,000 to 211,750, they have been below 220,00 since early July, a remarkable stretch last duplicated almost a half-century ago. The number of people collecting unemployment benefits, meanwhile, fell by 13,000 to 1.64 million. These “continuing” claims touched the lowest level since Aug 1973.
Additionally, Job Openings just hit a record high and the U.S. Unemployment rate has fallen to a 48-year low while hiring remains robust. The demand for labor is so strong it’s pushing up the cost of worker compensation and giving an economic growth cycle that’s now more than nine years old the staying power to become the longest expansion ever.
I feel like they threw Christmas in December because the sky is usually so drab. Although, December has some National Food days that make up for the gloominess: National Hot Chocolate Day; National Cookie Day; National Pumpkin Pie Day; National Brownie Day; National Eggnog Day; and National Fritters Day. Here are December’s money must do’s.
Check for unclaimed funds
Give to charity
Review annual spending
Recently, as part of the Economic Growth, Regulatory Relief, and Consumer Protection Act of 2018, Congress made several changes to credit rules that benefit consumers.
Under the new law, consumers are now allowed to "freeze" and "unfreeze" their credit reports free of charge at all three of the major credit reporting bureaus, Equifax, Experian,and TransUnion. The law also extends free credit freeze protection to children under age 16 and increases initial fraud alert protection to one full year (previously, fraud alerts expired after 90 days unless they were renewed).