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Staggering shortfall in pensions - what you need to know if you’re counting on one:
Bottom Line: If you’re counting on a pension – you need to know what I’m about to tell you, but you won’t like it…
We just hit a staggering record shortfall of $452 billion across all companies that promise a pension. That’s right, pensions are under funded by $452 right now and that number could grow. In fact the number has grown by 27% year over year.
91 million Americans are currently counting on pensions being there for them in the future. That compares with just 51 million who have 401k plans. That needs to reverse and quickly. I’ve long called pension plans legalized fraud (much like Social Security). I don’t say that to be dramatic or to mislead. It’s simply a reality from a pragmatic point of view. Why?
Is there any guarantee that your company will be around and financially sound in 30 years? How about 20 or 10 or even next year? Of course not. That’s true of Social Security as well. That’s why 401k or 401k like accounts are the answer.
Once an account is in your name it can’t be taken away from you. If your company goes out of business tomorrow you still retain 100% of your retirement savings. The same would be true with regard to Social Security. This enormous pension shortfall only highlights the need to take as much control over our retirement accounts as possible. If you have an option between a 401k account and a pension plan – take the 401k option every time.
Starbucks is about to offer 10x faster internet and the implications for you could be big:
Bottom Line: For many Starbucks loyalists the free Wi-Fi is a daily benefit of their coffee shop experience. If this is you - expect a big improvement in speed. Starbucks is saying that they will soon be offering internet in all of their 7000+
Google will be the new internet service provider to Starbucks, replacing AT&T who’s been the provider since 2008. For years it’s been a war between the
If Google can power Starbucks, they surely aren’t far from offering residential nationwide service. If it’s significantly faster and cheaper who will you go with? This will force the hand of the traditonal companies and regardless we should benefit. Stay tuned…
Bottom Line: Yesterday we received the
What’s interesting is that prior to the final negative revision by the Government to the first quarter
The job growth that’s above the average of sub 2% growth is explainable in part because companies that weren’t wanting to hire until after they had a better handle on what compliance with the ACA would cost them. Those companies aren’t in a position to wait another year and half before they hire and so they’ve started to add to their payrolls. As a result economic growth should improve in the 3rd and 4th quarter with an increase in employment. And there is one more take away.
The rate of a 30 year fixed rate mortgage yesterday prior to the Federal Reserve downgrading the economic outlook for the year was 4.3%. The rate this morning is 4.4%. That’s an indication that the Fed is still poised to reverse its QE policy later this year. That makes sense with an improving economy in the 2nd half of the year. I don’t know exactly what the Fed plans to do but I believe they will begin to taper QE in the 4th quarter of this year and mortgage rates will likely be higher at the end of the year vs. where they are right now.