CNBC.com Article: Tax Hikes Coming No Matter Who Wins White House

CNBC.com Article: Tax Hikes Coming No Matter Who Wins White House

 



Regardless of who wins the White House this November, the new health-care law will raise taxes on high-income Americans next year—and that could have implications for stocks and other assets.

Starting Jan. 1, there will be an additional 3.8 percent tax on investment income—including capital gains, dividends and rental income. It will apply to married couples with adjusted gross income of $250,000 or more and for individuals above $200,000.

There will also be a 0.9 percent tax next year on all salaries and wages earned above those same threshold amounts.

The new taxes, part of the 2010 health care law, are expected to help fund Medicare.

The tax hikes mean that the current dividend and capital gains tax rates of 15 percent will rise to at least to 18.8 percent next year for the wealthiest tax payers.

If Democrats win the White House and Senate, they are expected to push for a 20 percent capital gains and dividend tax rate, while Republican presidential hopeful Mitt Romney favors no change.

 

Read Full Article:CNBC

As Low Rates Depress Savers, Governments Reap Benefits

A consumer complaint is ricocheting around the world: low interest rates are eating away at savings, the New York Times reports.

Bill Taren, a retiree near Orlando, Fla., discovered in August that his credit union would pay only 0.4 percent annual interest on his saving account, even though inflation averaged 2.8 percent over the last year. So he and his wife decided to just stuff their money in the mattress, he says, because at least there “we can see the cash when we want.”

Jeanne and André Bussière, in Annecy, France, have a stable pension and a bank account that pays 2 percent interest — “almost nothing,” they say — even though the consumer price index rose an average of 2.5 percent over the last year.

Jiang Rong, an information technology professional in Xiamen, China, decided to dive back into the speculative real estate market rather than watch his savings wither at the bank. In China, too, the cost of living is outrunning savings, as local restaurants nearly double their prices.

The fact that interest yields are so low in so many parts of the world is no coincidence. Rates are determined not only by markets, but also by government policy. And right now many governments say they have good reason to keep their own borrowing costs as low as they possibly can. Just last week, the government’s report on job growth in the United States showed continued weakness, and an international forecasting group warned that the European economic powerhouse, Germany, will fall into recession later this year.

 

Read more: CNBC.com Article:

Who's Profiting From Your 401(k)?

 

CNBC.com Article: Who's Profiting From Your 401(k)?

Why investors have suffered below-market returns even as mutual fund management company owners enjoyed market-beating results.

In this election year, there's a lot of talk about how the middle class has been decimated by our economic woes. In a sobering study titled "[T]he lost decade of the Middle Class", Pew Research Center defines this beleaguered group as those with household incomes between $39,000 and $118,000.

According to Pew, since 2000 the middle class "has shrunk in size, fallen backward in income and wealth, and shed some – but by no means all – of its characteristic faith in the future."

Their median income has fallen from $72,956 to $69,487.

Full Story:
http://www.cnbc.com/id/48827909

Learn more at www.donaldjlester.com

Article: How Much Will It Cost You If Bush Tax Cuts End? A Lot

CNBC.com Article: How Much Will It Cost You If Bush Tax Cuts End? A Lot

Americans would shell out as much as $5,700 more a year if the Bush tax cuts are allowed to expire at the end of 2012, according to a new analysis that highlights the perils and political consequences of the nation's fiscal cliff.

Full Story:
http://www.cnbc.com/id/48674247

Learn more about this....www.donaldjlester.com

The Historical Shift in Social Security.

The Nest Egg is Boken as reported by Fox News.

New retirees receiving less in Social Security than they paid in, marking historic shift.

People retiring today are part of the first generation of workers who have paid more in Social Security taxes during their careers than they will receive in benefits after they retire. It's a historic shift that will only get worse for future retirees, according to an analysis by The Associated Press.
Previous generations got a much better bargain, mainly because payroll taxes were very low when Social Security was enacted in the 1930s and remained so for decades.
"For the early generations, it was an incredibly good deal," said Andrew Biggs, a former deputy Social Security commissioner who is now a scholar at the American Enterprise Institute. "The government gave you free money and getting free money is popular."
If you retired in 1960, you could expect to get back seven times more in benefits than you paid in Social Security taxes, and more if you were a low-income worker, as long you made it to age 78 for men and 81 for women.
As recently as 1985, workers at every income level could retire and expect to get more in benefits than they paid in Social Security taxes, though they didn't do quite as well as their parents and grandparents.
Not anymore.


Read more: http://www.foxnews.com/politics/2012/08/07/new-retirees-receiving-less-in-social-security-than-paid-in-marking-historic/#ixzz22yWt5aKh

Say Yes to Marriage, But Never to Joint Checking

Simple asset protection strategy.



CNBC.com Article: Say Yes to Marriage, But Never to Joint Checking

Newlyweds can mutually protect their credit scores by keeping their finances unentangled.

Full Story:
http://www.cnbc.com/id/48307272

Learn more about asset protection strategies by contacting Donald J. Lester at 719.330.2618

Crack Shacks, Mansions, and Household Wealth

Dave Gonigam – July 23, 2012

• Are Canadians richer than Americans. Well, yes… but for how long?
• Professor Niall Ferguson pinpoints “the biggest trend in economics, and perhaps geopolitics, in our lifetime”
• Byron King on the “white sands” that will speed up a critical step in the mining of metals by 99%
• A Chinese gold scam that could drive investors toward physical metal… an honest, if bizarre, silver offering from a scammy U.S. company… the most vitriolic letter ever addressed to The 5… and more!

Here’s a Monday milestone: Your typical Canadian is now richer than your average American. On paper, at least.
“Over the past five years,” reports the Toronto Globe and Mail, “net worth per Canadian household has exceeded net worth per American household (total combined value of liquid and real estate assets minus debt) for the first time.”
The paper cites figures from Environics Analytics that say the average household net worth in Canada was $363,202 in 2011. That compares with a U.S. figure of $319,970. The greenback and the loonie are more or less at parity these days, so the numbers aren’t skewed by currency fluctuations.
But wait, you ask… Isn’t Canada in the midst of a housing bubble? Wouldn’t that skew the numbers?
If you plug the word “Canada” and then “housing” into Google, the first auto-fill suggestion that comes up is “bubble.” Before “market.” Before “price.”
The question is of more than passing interest to this editor, en route to Vancouver for this week’s Agora Financial Investment Symposium.
Vancouver is truly a lovely place. It is also one of the world’s most-expensive housing markets. This year, it supplanted Sydney as No. 2 on a list assembled by an outfit called Demographia; Hong Kong is still tops.
Indeed, Vancouver is the inspiration for a website called “Crack Shack or Mansion?” — in which you look at pictures of various homes and guess whether they’re crack shacks or a $1 million-plus properties.




This one’s a mansion, listed for $1,180,000
“Canadians hold more than twice as much real estate as Americans and, once mortgages are factored in, have almost four times as much remaining equity in their real estate,” the Globe and Mail story goes on.
The part about their equity is good… as long as prices hold up. Right?
To be sure, Vancouver is an outlier when it comes to Canadian real estate. Still, the average home price in Canada last month was C$369,339, according to the Canadian Real Estate Association.
In examining whether such a figure is sustainable, it’s worth asking how it compares with median household income — which in 2010 was C$69,860.
Ouch… The average house price is 5.2 times median household income — rather more than the 2 or 3 times the personal finance experts would tell you is prudent.
At the peak of the U.S. housing bubble in 2006, the average home price was $246,500. Meanwhile, median household income was $48,201. That works out to a multiple of… whaddya know, 5.1 times.
Hmmm….

Read More at Agora Financial: http://5minforecast.agorafinancial.com/crack-shacks-mansions-and-household-wealth/


Learn more how Donald Lester can help you with your retirement planning...Call him at 719.785.7170