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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
An Impressive Performance By The Federal Reserve
Published Wednesday, February 15, 2023 at: 6:05 PM EST
Over the last 12 months, the Consumer Price Index increased 6.4% before seasonal adjustment. With the Federal Reserve targeting a 2% inflation rate, it may seem like inflation is still not under control. But if you break down the monthly inflation figures, it’s a tale of two very different periods: a five month period of high inflation followed by much lower inflation for the last seven months.
The average monthly increase in inflation for the past seven months was .27%. That’s 3.25% on annualized basis, which is not so far from the Federal Reserve’s 2% goal.
The Federal Reserve’s survey of the Federal Open Market Committee, indicates two more rate hikes of a quarter of 1% are yet to come, with one in March and another in April or May. This is expected to complete one of the most aggressive rate hike campaigns in the history of the last century.
At the end of a brutal rate hike cycle, the economy is similarly divided. The U.S. Index of Leading Economic Indicators has sunk eight straight months, which historically is a sure sign a recession is on the way. However, the job market is booming, with 11 million jobs open but only 5.7 million job seekers. This means consumers will continue to have money to spend and consumers drive 70% of the economy.
Whether a soft landing would be possible after very aggressive Fed tightening has been the big question facing investors for many months. But it is starting to seem possible that there may be no landing at all. Inflation could settle near the 2% target by the end of 2023 and the economy could continue to grow modestly, never touching down.
It’s an impressive demonstration of the power of the U.S. Federal Reserve System, and evidence of what makes America exceptional.
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