Friday Financial Five – June 3, 2016

Friday, June 03, 2016

Dan Forbes, GoLocal Contributor

President Obama looks to expand Social Security benefits

A huge percentage of the country receives the majority of their income from Social Security. President Obama, who in the past has acknowledged how underfunded the program is, recently suggested benefits should increase. To fund expanded benefits, he suggested the wealthy would pay more into the program, a staple of the Democratic presidential candidates’ platforms. The president has supported lifting the income cap that’s subject to Social Security taxes in the past, but that was to provide additional funding to the program, not expand the payment of benefits.

ECB leaves interest rates alone

The European Central Bank continued a negative interest rate environment while awaiting Britain’s referendum on the Euro. The decision could go either way and the result will determine the future course of action for the rest of the ECB’s participants. President Draghi of the ECB was cautiously optimistic that conditions are improving but stated there may be further stimulus needed to meet an inflation target of just under two percent.

Student debt lingering for millennials

The Plan Sponsor Council of America (PSCA) examined student loan debt as a barrier to retirement savings for millennials in the workforce. Its estimated that seventy percent of students are borrowing money to finance their education, an increase from half of students who borrowed twenty years prior. Over a third of the study’s respondents stated that their student loan debt presented a “moderate” or “high” barrier to saving for retirement. While many companies offer tuition reimbursement for workers, very few assist directly in loan repayment plans.

Chamber of Commerce fighting overtime changes

The United States Chamber of Commerce, with support from local chambers across the nation, is fighting the changes recently imposed by the Department of Labor. With the new rule, the threshold for salaried employees to receive overtime pay for working more than 40 hours will increase from $23,660 to $47,476, effective December 1st of this year. Beginning January 1st of 2020, those levels will occur every three years. According to the U.S. Chamber, this will result in salaried workers being moved to hourly and a reduction in health and retirement benefits. The Chamber is advocating that Congress stop the rule’s implementation and allow further study of its ramifications.

Friendly cities to start a new business

As the Chamber fights on behalf of small business owners, the list of major cities that make it easier to start a business is the subject of an analysis by Wallethub. Sioux Falls tops the list and Grand Rapids comes in second as both capitalize on solid “costs” and “business environment” scores. Boston is the top city in the northeast, placing fourteenth overall. Texas has six spots in the top twenty-three. Providence finished 149th out of a possible 150.

Dan Forbes, a CFP Board Ambassador, is a regular contributor on financial issues.

Related Slideshow: Oregon Business Rankings in US

See how Oregon stacked up against the other states in the U.S.

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ThumbTack

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+
Regulations D
Health & safety D
Employment, labor & hiring D
Tax code D+
Licensing C-
Environmental D
Zoning D+
Training & networking programs B+