Almost everywhere we look these days, we’re seeing big numbers – the nation’s deficit and debt, total student loans outstanding, the underfunding of municipal pensions, our over-extended entitlement programs: Social Security, Medicare and Medicaid. Where it’s all going is anybody’s guess, but at the risk of overload, I’m going to share one more big number with you – one that has clear relevance to all of our futures.     A 65-year-old couple retiring this year will need $240,00...  Read more...

Recently, a good friend of HORAN’s gave us an update on some of the estate planning provisions contained in President Obama’s proposed budget for 2013.   The budget, if passed intact, would permanently restore the estate and gift tax rates to those that were in effect in 2009 and curtail or eliminate several very popular estate planning techniques. Below is a summary of the proposed changes: The current estate tax exemption would decrease from $5.12 million to $3.5 million. ...  Read more...

Recently, I was reading a publication from UnitedHealthcare entitled, ‘Top Ten Health Care Trends’ by Jack Uldrich. It was fascinating. Listed below are just four of the ideas outlined in the paper.  It confirmed our thinking that health care will be vastly improved using technology.  New advances in Genomics will allow us to look within ourselves to really explore personalized medicine.  Robotic-assisted procedures are rapidly increasing and they are valuable because...  Read more...

Fixed returns on investments are reaching historic lows. Many of our clients who are in the distribution phase of life want a portion of their assets in fixed type investments so the portfolio is not subject to the ups and downs of the market.   But with returns so low, how do you balance risk and reward with the need to create a livable income from the portfolio? Paul Sullivan, reported in the New York Times on January 28th, “When Safe Bonds don’t Yield Enough to Retire On,” t...  Read more...

American households are still failing to fully embrace the current economic growth for three reasons - low interest rates on savings, ongoing loss of wealth, primarily caused by the decline in real estate dollars and persistently high credit card balances. Historically low returns on fixed investments are challenging all Americans, but especially Seniors.  The U.S. Treasury Department reports that the average interest rate paid by the US government was 5.034% as of 12/31/06.  In ...  Read more...

The chart below, released from the Internal Revenue Service in October of 2011, outlines the amount of Federal Income Tax paid by each income group in 1999 compared to 2009. The chart highlights some very interesting observations. The top 1% income bracket paid 36.1% of the tax in 1999 and paid about the same, 37.7% of the tax in 2009.   The top 10% of the income earners in the country paid 70.5% of the tax in 2009, up slightly from 1999 when they paid 66.5% of the tax.  The...  Read more...

Recently, there was an important article by Carl Richards writing for the Blog, “Bucks,” in The New York Times. The article bears repeating. Equity investment results in the period between 2000 and 2010 were not so grim if investors prudently followed the wisdom of diversifying their portfolio. In this article, Mr. Richards outlines the performance of a broadly diversified portfolio of equity investments consisting of five asset classes: Large stocks (the S&P 500) Smal...  Read more...

Life Insurance products have developed and matured over time. Policies issued over the last 30-40 years respond positively and negatively to economic trends. In many cases, the policies developed by the insurance companies responded to an economic cycle that never really repeated.  Last year, my friend John Barry of the firm Barry, Evans, Josephs & Snipes in North Carolina developed the chart below illustrating two historical timelines. The upper time line outlines key m...  Read more...

Employers who help workers deal with financial stress are creating a healthier and more productive work environment. Employers are grappling with the high cost of health care. Many are encouraging employees to adopt healthy lifestyles to address the spiraling cost of health care – a very important step. But, employers should also recognize that a significant number of their employees are dealing with financial stress which can contribute to medical issues and lost productivity. T...  Read more...

Today’s low interest rate environment is causing prudent families to boost the amount of life insurance they own to replace the income stream lost with the death of a spouse. Our research indicates that life insurance portfolios should be increased by as much as 27%. The unprecedented reduction in interest rates is causing a number of opportunities and problems in the American economy. Never has there been a better time to purchase a new home as mortgage interest rates are the lowes...  Read more...