Terry Savage: Consumers will decide the fate of the economy
It’s up to us, the consumers, to determine the fate of our economy. While we waited for the debt ceiling impasse to be resolved, and while we continue to wonder about the next interest rate move on the part of the Fed, we have always been the real moving force in the American economy.
Consumer spending accounts for about 70% of all spending ...Read more
Terry Savage: Which stock market? It matters when judging returns
Last week’s column explained why it’s so difficult to “beat” the market. A review of professional money managers by S&P Dow Jones Indices revealed that half of large cap fund managers failed to beat their benchmark index (typically the S&P 500) in 2022.
And even those who outperform do so on a temporary basis; only 5% of the above-...Read more
Do you really think you can beat the market?
The stock market has traded in a fairly narrow range in recent weeks, holding its breath for a deal on the debt ceiling and for signs of oncoming recession. The market is also awaiting future Federal Reserve actions.
Bulls and bears have been in a standoff — debating whether a weaker economy will cause the Fed to cut rates and boost stock ...Read more
Terry Savage: Long-term care and inflation
A recent survey from the Senior Citizens League detailed the impact of inflation on the items senior consumers purchase most often. Over the past 23 years — from 2000 to 2023 — they point out that Social Security increased benefits by 78%, averaging 3.4% annually. But during the same period, the cost of goods and services bought by typical ...Read more
Terry Savage: More Social Security horror stories
Two months ago, I wrote a column telling the story of an older woman, a widow recovering from heart surgery, who was being harassed by the Social Security Administration demanding a “clawback” of more than $88,000 in benefits she had received over the years — all because the agency had made a mistake in calculating her benefits. Social ...Read more
Terry Savage: Fraudsters are more clever than you think
I’m going to tell you a scary story. Or rather, I’m going to let the person involved tell you his true story — one that should make you aware of how easy it is for your parents or you to get drawn into a financial scam.
Technology has enabled fraudsters to grab your money so quickly and so anonymously that instances of fraud have ...Read more
Terry Savage: Estate planning for all
People tend to avoid the discussion of estate planning because no one likes to think about their mortality. Plus, there’s the presumption that only the wealthy have an “estate” that needs planning.
But many moderate-income families may have a very special need to do some simple estate planning. If they arrange their assets properly, they ...Read more
Terry Savage: Speaking of safety
In the search for safety of your financial assets, there’s a sudden recognition that the FDIC doesn’t cover deposits above a certain limit: $250,000 per depositor, per insured bank.
You can extend that coverage through the use of joint accounts or trust accounts, but that raises the question of why you want to juggle those accounts when it ...Read more
Terry Savage: Is Social Security going broke?
The Social Security trustees just announced that the primary trust fund used to pay retirement benefits is set to become depleted in 2033. At that point, the only money available to pay promised retirement benefits will come from those currently paying into Social Security out of their monthly paychecks.
And, in 2033, that inflow is estimated ...Read more
Money, markets and fear
Given the recent headlines, I want to say a few words about the safety of your money in the bank — and all the “end of the world” financial stories, memes and social-media posts that have started to circulate — again.
This is not the first time Americans have worried about the fate of the U.S. dollar and America’s central place in the...Read more
What interest rate hikes mean for your finances
The Federal Reserve's latest rate hike is the ninth increase in the last 12 months — for a total of 475 basis points. The current Fed Funds target rate is 4.75% to 5%; a year ago it was less than 1%.
As a result, Americans have received a very public lesson in interest rate risk, and its impact on the banking system. But now it’s getting ...Read more
Terry Savage: Tips for tax filers
It’s that time of year again — income tax time. If you’ve already filed your return, pat yourself on the back. But if you’re one of the millions who procrastinate, here are some helpful reminders along with some tax changes that you might not have noticed yet.
This year's tax filing deadline is Tuesday, April 18th.
You can get an ...Read more
The unexpected cost of long-term care
It’s the one financial planning issue that everyone wants to avoid. Your retirement may go according to your financial plan. On the other hand, you and your family may face the unexpected cost of long-term care that is not covered by Medicare or Medicare Advantage plans.
This is the cost of getting help doing the basic activities of daily ...Read more