entrepreneurship, new economy, Socially Responsible Investing, SRI

‘Be the change that you wish to see in the world’: A Speech to Cooperative Impact 2015, Princeton 5/14/2015

Several years ago, I was asked to give an opening keynote speech to a gathering of social innovation entrepreneurs. The message I think is one that continues to be relevant…

We are on the edge of the greatest entrepreneurial revolution in the history of mankind.

The internet, the “cloud”, on-demand shipping, social media, Linked In… All are changing how we relate to each other economically and socially.

As entrepreneurs we are on the cutting edge. We all know entrepreneurs are a special subset of people and “social entrepreneurs” even more so.

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health, life insurance, protection, risk management

Diet, health, and the financial impact on life insurance

The purpose of life insurance is to manage risk. Individuals and families need protection in the event a primary bread winner passes away.

Several factors drive what life insurance costs for an individual. Women tend to live longer, so their cost for life insurance is lower than it is for men. The healthier a person is, the less expensive it is for them to obtain life insurance. People who smoke pay significantly more for life insurance.

Each person’s health situation is unique. Part of the process of obtaining life insurance is to collect medical samples for testing. The underwriter also reviews records from your doctors over the past 5 years. They also examine driving records.

Once all of the information is collected the underwriter evaluates the data at hand and assign the insured person a health rating. The better the rating, the lower the premium. 

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economy, interest rates, retirement, risk management

The End of the 10 Year Bull Market

There is a Chinese curse… “May you live in interesting times.” (1)

 

Given the past month, we clearly live in interesting times. Twice this week the market has opened down more than 5% triggering circuit breakers. While these breaks helped, the market still declined.

 

As of March 12, 2020 the SP500 is down 26%.

 

On March 3, 2020 the Federal Reserve announced a 50 basis point rate cut and are expected to cut rates another 100 basis points at its March 18th meeting. (2) On March 12, 2020 the Fed announced a $5.5 trillion program to assist in Repo operations. (3)

Yes… $5.5 trillion… The scale of the program is beyond anything ever attempted to stabilize markets.

 

WHAT ARE THE ISSUES THAT ARE FEEDING INTO EACH OTHER? HOW DID WE GET HERE?

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charitable giving, life insurance, protection

A beloved relative has passed away and left me an inheritance… What should I do?

I have had several clients experience the passing of a beloved family member in the past 6 months. All ages, all walks of life. To a person they struggle with the desire to have their father or spouse or daughter back with them again, and how to move forward without them.

I have lost both of my parents; my mother passed away at 42 from lung cancer. I know the pain they suffer. Looking back, her illness and death really hurt my father and younger brother financially. She didn’t have life insurance. Due to the illness many of the family’s assets were exhausted. My father and brother did the best that they could do, but it was a difficult journey.

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Climate change, economy, environment, ESG, retirement, risk management, Socially Responsible Investing, SRI

Climate Concerns Rise, but Energy Sector is Fighting Back…

In the past year Climate Change has become a focus of central concern for people worldwide. Warnings have been issued by IPCC that we need to collectively and drastically reduce our use of fossil fuels within 10 years in order to avoid the worst impacts of a rise in temperatures above 1.5 degrees.

Institutions are joining in the demand for change.

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economy, retirement, risk management

Psychology and the Market

On Monday February 24th 2020 the Dow dropped over 1000 points in a single day.

 

Human behavior is driven two forces, fight or flight. When facing a dramatic event we as individuals are forced to REACT to what happens. 

When looking at the market, if a person is underinvested and it goes up day after day making new highs, that person may experience FOMO… fear of missing out. They might make the decision to invest based on emotion instead of fundamentals.

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income, retirement, Taxes

RMD: What are the Risks and How Can We Address Them?

Several recent studies show peoples number one fear is running out of money during retirement.

To prepare us for retirement the government gives workers the ability to set up qualified accounts in order to save for retirement and get tax deferred growth. By deferring taxes money saved can grow faster. You put money away, not paying taxes now, but paying taxes on the money when you pull it out during retirement.

When you get to retirement, you can start pulling money from your account. In the past it has been considered good practice to not draw more than 4% from an account during retirement in order to make sure you don’t outlive your money. In the past bond yields have been 5-7% and that makes a 4% draw down possible. Now over the past 5 years bond yields have been around 2-3% and because many retirees rely on bonds to deliver income to their portfolio, many economists and advisors have been advising clients to withdraw less from their IRAs; this is so retirees don’t run out of money when they are older.

Now what if I told you there was a government program that requires you to draw more income from your account, without any consideration for how long you or your spouse will live, and without regard for whether you will run out of money or not.

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disability, health, protection, risk management

Deaths of Despair

In recent months companies at the center of the Opioid Crisis have been fighting in court about the roles they played in the epidemic that has affected millions of Americans. The over prescription of highly addictive drugs has had severe impacts on families, businesses, and the economy as a whole. (1) But the Opioid Crisis is only part of a much larger problem facing American Society.

In March of 2017 a landmark study was released connecting opioid abuse, financial security and death rates in the United States. The information is sobering and should be the focus of policy changes at all levels of government.

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disability, economy, health, life insurance, protection, retirement, risk management

Women and Financial Security

In 2018, the government of Iceland passed a law making it illegal to pay women less than men. (1) 

According to a World Economic Forum report, “At the current pace, gender gaps can potentially be closed in 54 years in Western Europe… and in 151 years in North America (reflecting lack of progress in the region this year).” (2)

A recent study by Economic Policy Institute found that women earn 74 cents for every $1 earned by a man with similar education and experience. This wage gap has always existed and is disturbing in a society founded upon equality and justice. (3)

This wage gap has important implications for women and their financial security, especially during retirement. 

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AI, disability, economy, life insurance, new economy, protection, retirement

Jobs at Risk

A recent study by McKinsey Global Institute examined how robotics will affect labor and the economy. The study estimated that 800 million jobs (1/5 of all jobs) will be impacted by advances in robotics. (1)

Among the jobs most impacted include brokers, accountants, office staff, machine operators, and food service. Lower skilled, repetitive tasks are most likely to be replaced.

What does this mean for family finances in the years to come?

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