Wealth and Wisdom: Week of April 22, 2024

Like a basketball guard who picks up his dribble when facing a full-court press, the Fed is pivoting yet again. In the span of a few short weeks, the central bank has gone from predicting three interest rates cuts in 2024 to promising none at all. Fed Chair Jerome Powell said resurgent inflation makes it less likely we’ll see lower rates anytime soon, and there’s now debate among bond investors that the Fed may even have to raise rates if prices don’t start easing again soon. No timeouts left, and no one to throw the ball to.

Speaking of taxes (I realize we weren’t, but I’ll bet you’ve been thinking about them lately), I read an interesting article the other day that said “the tax code is so complex and tangled that Americans spend nearly $300 billion just to figure out how much they owe the government.” And thanks partly to the confusing maze of the U.S. tax code, $450 billion in taxes goes unpaid each year.

No Wealth and Wisdom next week. I’ll see you the week of May 6.

Here’s who pays how much in taxes

A new analysis shows the top 1% of earners pay more than 45% of U.S. income taxes. The bottom 50% pay just over 2%. (Reading time: 3 minutes)

Using investment losses to lower this year’s tax bill

How tax-loss harvesting works – and how to sidestep the strategy’s biggest pitfall. (Reading time: 4 minutes)

Car insurance rates are up 22% over last year

Blame more expensive cars, more lenient law enforcement – and drivers who don’t have enough sense to put down their cellphones. (Reading time: 4 minutes)

Punished for playing by the rules

The Biden administration is forgiving student debt for another 277,000 borrowers – making those still paying down their loans look like suckers. (Reading time: 3 minutes)

Last-minute checklist if you’re about to retire

Get the answers to these three questions before you clock out for the last time. (Reading time: 3 minutes)

Should retirees downsize in this housing market?

Home prices are high – and so are mortgage rates – but there are still plenty of reasons to consider moving to a smaller home in retirement. (Reading time: 3 minutes)

The Social Security ‘bridge strategy

Here’s a way to cover your retirement expenses while allowing your Social Security benefits to keep increasing until age 70. (Reading time: 4 minutes)

Or maybe just keep working

Staying on the job past “normal” retirement age has many potential benefits – and not all of them are financial. (Reading time: 3 minutes)

Finding the right financial advisor

A good advisor can make your financial life easier and less stressful while helping you make better decisions. (Reading time: 4 minutes)

A beginning investor’s bookshelf

Here’s a list of 11 popular books for new investors – and the last one is my personal favorite. (Reading time: 7 minutes)

Words to the Wise

““Starbucks announced a new program that will pay employees to take classes at Arizona State. Said Starbucks employee: ‘We already went to college. That’s why we work at Starbucks.’””

– Seth Meyers

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