Friday Financial Five – June 12, 2015
Friday, June 12, 2015
Lists ranking retirement destinations are a part of life now, as the decision of where to live in retirement is so important to the planning process. It should also serve as a wake-up call for states actively seeking to incentivize retirees to spend their money. The most recent list, courtesy of Bankrate.com, has Phoenix at the top and Arizona holding three of the top four spots. The only northeastern location to break the top 40 is Cambridge, Massachusetts. 172 locations are ranked based on taxes, weather, and crime, among other categories.
Student loan refinancing heating up
There had been a student loan freeze for years, forcing student borrowers to assume higher than market interest rates to fund tuition expense. Now, higher income professionals have expanding options for their debt, as private markets are offering to refinance 6 and 7 percent debt for much lower rates. Some of these loans also being securitized as SLABS (Student Loan Asset Based Securities) for investment purposes. As noted in Bloomberg, while this newfound flexibility is great for student borrowers, it will greatly alter government revenue as high interest loans come off the books due to refinancing.
June budget update
If it seems like you’re paying more in taxes, it’s probably because you are. According to the June release of May’s numbers, individual tax receipts are up over 12 percent for first seven months of the fiscal year. Corporate taxes are up over 10 percent. Medicare and Social Security spending are up as part of a 4 percent spending increase. Overall, the deficit is running 16 percent lower than the same time last year.
Older workers face possible employment issues
Instead of stopping work cold turkey, the retirement equation now involves “part-time work” or “going back to work” more than ever. A recent presentation by the U.S. Equal Employment Opportunity Commission details the challenges faced by older workers, especially since the recession of 2008. Unemployment rates for older workers have doubled and the time out of work has lengthened. It’s an important variable for anyone planning to work after the traditional retirement age to consider. For those unable to find work, the unenviable alternative may be a reduced standard of living.
Switzerland to vote on new estate tax
As budgets get revisited at the local level, it’s a reminder that countries can alter their tax base with changes in policy. Switzerland will vote next week on an estate tax measure that may drastically alter their business landscape. The measure would impose 20% tax on inheritances greater than 2 million Swiss francs ($2.2 million) bequeathed directly to children. Opponents point to the detrimental ramifications on family businesses in the country, with some projecting 12,000 people losing their job annually.
Dan Forbes is a regular contributor on financial issues. He is a CFP Board Ambassador. He leads the firm Forbes Financial Planning, Inc in East Greenwich, RI and can be reached at [email protected].
Related Slideshow: Oregon Business Rankings in US
See how Oregon stacked up against the other states in the U.S.
Oregon gets a C+ for small business friendliness from Thumbtack, in conjunction with the Kauffman Foundation.
According to the ranking:
Overall friendliness C+
Ease of starting a business B
Ease of hiring D+
Health & safety D
Employment, labor & hiring D
Tax code D+
Training & networking programs B+
Oregon has been ranked as the 2nd most eco-friendly state in the country, according to a recent study by WalletHub.
Oregon ranks eighth in environmental quality and first in Eco-Friendly Behaviors landing them in second overall.
Oregon is behind Vermont and ahead of New York and Minnesota who land in the third and fourth spots respectively.
Small Business Friendliness Grade: C+
The Economist grades states on an A+ to F grading scale for its small business climate. Oregon is one of 4 states that earned a "C+"
Overbearing bureaucracy and excessive licensing is stifling small business in America.
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