Wealth and Wisdom: Week of May 6, 2024

On the one hand, at the beginning of this year – a scant five months ago – 9 out of 10 of the nation’s economists were on the record predicting the Fed would cut interest rates at its May 1 meeting.

On the other hand, by the time the Fed met last week, 97% of those same economists were saying just the opposite.

Now we know why President Harry Truman once pleaded: “Give me a one-handed economist!”

With hopes of rate cuts fading fast, the pressure is now on corporate profits. We’re in the middle of quarterly earnings season, and while overall the reported results so far have been decent, they aren’t overly impressive. Plus, we learned last week that companies are having to pay higher wages to attract employees – something else that could keep inflation and interest rates elevated for a while.

All of which might explain the recent pullback in stock prices.

More relief for inherited IRA beneficiaries

The IRS still can’t decide how certain beneficiaries of inherited IRAs should be withdrawing the money – so it’s waiving RMD penalties for another year. (Reading time: 2 minutes)

Boomers are coming up short at retirement...

They are reaching retirement age now in record numbers – but two-thirds of them haven’t saved enough money. (Reading time: 3 minutes)

…but millennials are doing well financially

New research shows the average wealth of Americans under age 40 is growing rapidly – despite some earlier concerns. (Reading time: 4 minutes)

How much money does it take to make us happy?

A new survey shows how much the average American needs today – in income and net worth – to feel happy and financially secure. (Reading time: 3 minutes)

Spending tomorrow’s wealth today

Thanks to higher interest rates and uncontrollable spending – the U.S. government now spends a trillion dollars a year in interest alone. (Reading time: 2 minutes)

Where the candidates stand on retirement issues

President Biden wants to raise taxes to save Social Security and Medicare. If his opponent has a plan, he’s not sharing it yet. (Reading time: 7 minutes)

30 years of market returns

Despite a litany of bubbles, crashes, 9/11, and the pandemic over the last three decades, investment returns have been remarkably close to their long-term averages. (Reading time: 3 minutes)

Roth IRAs vs. Roth 401(k)s: how they differ

These two retirement savings vehicles are based on the same premise – but up close there are some stark and surprising differences. (Reading time: 3 minutes)

Essential advice for new college graduates

Here are 9 strategies to give you a head-start on financial success – advantages that could compound for the rest of your life. (Reading time: 4 minutes)

Today's prices may not be as high as we think

Of course things cost much less back in the ‘good old days’ – but compared with how much people earned, they now seem really expensive. (Reading time: 2 minutes)

Words to the Wise

“If you do what you love, you’ll never work a day in your life. I learned that’s a total crock. You’ll work harder than you ever thought possible, but the tools will feel light in your hands.”

– Tim Cook

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