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Slick TV ads often make financial planning and wealth management sound simple, but it’s usually not. Managing wealth requires knowing a lot about highly technical topics, like taxes, government regulations, and finance as well as history, psychology and how to communicate with loved ones about sensitive issues. This article highlights some of the knowledge needed to manage wealth and why it’s often so daunting without the help of an independent personal financial advisor who is familiar with your situation.
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Understanding The Federal Reserve Mandate To End Inflation
The Federal Reserve System, the nation’s central bank, has a dual mandate to pursue maximum employment and maintain price stability. These two priorities are currently treated equally, but that was not always the case. In fact, the Fed’s bias toward maximizing employment was a critical driver of the stagflation that plagued the U.S. in the late 1960s and 1970s. Recognizing the need to balance price stability and maximum employment, in 1977, Congress revised the Federal Reserve Act.
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Fed Governor Kugler Details Inflation And Economic Outlook
The 12-month inflation rate, as measured by the personal consumption expenditures (PCE) index, was 2.6% in December, down from its peak of 7.1% in June 2022, and the six-month rate for PCE inflation was even lower, at 2%, which is the target rate set by the Federal Reserve.
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Why Rates May Not Be Cut Until June
The cost of a loan to buy a home, car, college education, and achieve the American Dream is staying the same for now. As expected, Federal Reserve Chairman Jerome Powell said the central bank did not lower loan rates following the Fed’s Wednesday, Jan. 31, 2024, policy meeting.
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Practical Suggestions For Achieving Your 2024 Resolutions
New Year’s resolutions usually fail because they‘re often too hard to achieve. After six months, only 10% of people who make resolutions achieve them or remain committed to them, , according to a study by Dr. Mark Griffiths, a Chartered Psychologist and Distinguished Professor of Behavioral Addiction at the Nottingham Trent University. What can you do to make financial, medical, or other personal resolutions more likely to be achieved?
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A Sign Of Progress In Solving U.S. Economic Problems
The Federal Reserve appears to be pulling off a feat most experts did not believe it could: ending its aggressive inflation-fighting campaign of 11 interest rate hikes without tipping the U.S. economy into a recession.
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Fed Keeps Rates Unchanged; Expects Easing In 2024
To promote transparency and free markets, the Federal Reserve System began publishing the opinions of the 19 U.S. central bankers that decide interest rate policy.
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Have You Logged Into Your Social Security Account?
Have you logged in to your Social Security account? Creating an online account at SSA.gov is an important first step in understanding your retirement income situation. However, only about 60 million of the 160 million individuals in the U.S. labor force who have Social Security accounts have created a way to access the Social Security Administration’s website.
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The Great Fake Out Of 2023 Is Poised To Extend Into 2024
All year long, the economy and stock prices have fooled experts and consumers, outperforming expectations month after month.
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Test Your Financial Planning IQ
The five questions below are a challenge meant to allow you to assess your knowledge of investing, tax and financial planning. If you have been following our news stream, this quiz draws on familiar ground. The answers are below.
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Planning Briefs
Amid Rapid Crosscurrents, A New Wave Of Small Business Is Emerging
Published Wednesday, December 8, 2021 at: 10:20 AM EST
The stock market has been more volatile in recent weeks, amid a rising tide of bad news on inflation, the Omicron variant, and job creation. Yet key economic fundamentals are booming, and a hidden treasure of capitalism may slowly be making its way to the surface.
First, the bad news: The Federal Reserve was wrong about inflation and how temporary it would be. The Fed was expecting inflation would top out at 4%, but in October, the most recent data available shows, the inflation rate blew through 4% to 5%, the highest level in decades! And the Fed has now backed off its assertion that inflation would be temporary and be over with early 2022.
More bad news hit when the Bureau of Labor Statistics announced on December 3rd that only 210,000 new jobs were created in November, much less than the 530,000 that had been expected. The U.S. needs to average about 100,000 new jobs monthly to keep up with growth of the population, so the 210,000 may seem strong. However, the labor market lost 22 million jobs in the pandemic and is struggling to make up for that unprecedented loss.
The number of employees in November remained 3.9 million lower than before the pandemic hit; the labor force is smaller, which usually translates into less consumer spending and slower growth of the U.S.
The proportion of the civilian population 16 years and older actively seeking work or working unexpectedly has not recovered from the pandemic.
The labor participation rate did rise more in November than it has in months, but still badly lags its pre-pandemic rate. The cause of this drop in the labor participation rate is widely ascribed to Baby Boomers who were at or near retirement when the pandemic hit and who chose to retire rather than risk catching the virus at work and, also, “The Great Resignation” by individuals who reassessed their life goals and financial needs during the Covid outbreak.
Which brings us to a hidden treasure easily lost in the latest swirl of grim economic news: The number of self-employed soared after pandemic struck and has rarely been so strong. Labor Department data show the number of self-employed Americans has soared from 9.4 million before the pandemic to 10 million in October. Census Bureau data reflect the same growth pattern in new business applications.
Small businesses account for nearly two-thirds of private-sector job growth in the U.S, and a flood of entrepreneurialism is being let loose. The growing ranks of self-employed have started new businesses and one or two of them could be the next Google or Amazon, and some will be local businesses with something better than before. Amid the swift crosscurrents of the world’s largest economy, on the strength of a new wave of entrepreneurs, bubbling up to the surface is American capitalism at its best.
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