Archive for October, 2011

32 Ways Of Looking At Unemployment, In One Chart

The unemployment rate fell slightly to 9 percent in October, according to this morning’s big jobs report. But this single number hides a huge variation among different groups.

For high school grads in their early 20s, for example, the unemployment rate is about 18 percent. For college grads in their 30s and 40s, the rate is under 5 percent.

The chart below allows you to explore these differences in detail. You can see how the unemployment rate has changed over time for people of all ages and all levels of educational attainment.

While the rate varies from group to group, the same trend holds constant for almost everyone: Unemployment shot way up in 2008 and 2009 and is still far higher than it was before the recession.

Notes

– Figures for 2001-2010 are annual averages; 2011 figures are based on the October jobs numbers released this morning.

Source: Bureau of Labor Statistics

Credit: Jacob Goldstein, Alyson Hurt and Jess Jiang/NPR

 

New Mortgage Options for a New Economy

It’s a new housing market, a new lending environment and a new economy. Keeping that in mind, it makes sense that new types of mortgages are popping up all over the place. Some of the innovative new mortgage options that are available to borrowers include:

The 40-Year Mortgage

The 40-year mortgage relates to the term or number of years that the mortgage is outstanding. In addition, the term of the mortgage indicates how the monthly mortgage payments are amortized.

In short, a 30-year mortgage allows the borrower to amortize their monthly mortgage payments over 30 years. This means that the monthly payments will typically be lower than that of a 15-year mortgage, for example, which has a shorter term. With a 40-year mortgage, the borrower is getting the advantage of having an even longer term on the mortgage so they can spread out their mortgage payments, which also means that the monthly mortgage payments are usually going to be much lower than that of a 30-year or 15-year mortgage.

The Hybrid Mortgage

The hybrid mortgage combines the qualities of a fixed rate and adjustable rate mortgage. G


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Reach investment goals in a bum economy

News of a potential double-dip recession and persistent economic instability has investors running for safety and concerned about whether they can still reach their investment goals.

While the future of the economy is uncertain, and opinions vary about how quickly we’ll recover, one thing is certain: Whether we’re headed for another recession or just prone to “flash recessions” — one-month slowdowns in gross domestic product, or GDP — investors are looking at their portfolios and wondering what to do next.

A recession is defined as two consecutive down quarters of GDP. The last double-dip recession, which is two recessions with a short-lived recovery in between, was from 1981 to 1982. Back then, we had high inflation and interest rates. Once the economy recovered in 1983, the U.S. enjoyed a bull market for nearly 20 years.

But that was then. Now the economic landscape looks different.


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5 Ways To Prepare For Winter

With the temperatures dipping in the 30’s this week, the Midwest is starting to feel Old Man Winter creep in quickly!  Unfortunately, the cold usually means higher energy bills and sometimes unexpected repairs, but with a little planning, you can avoid some of the extra costs that come with the cold.

The US Department of Energy estimated that 5-30% of your energy use is wasted because of drafty windows and doors.

Solution:  We noticed a significant difference in the draft from our patio door when we sealed it with a plastic window film kit made by Duct Tape.  Using a blow dryer, you stretch the plastic until it’s tight, which creates an insulated barrier between your home and the cold glass.  Depending on how you apply the plastic, you might be able to seal up edges that let cold air creep in.  For a more archaic way of blocking a draft, you can roll up a towel and put it up against a door or window frame.

While it’s pretty obvious that you should have a good amount of insulation in your attic, you may have overlooked some great tax credits for insulating your home.  According to energystar.gov, you can receive a tax credit equal to 10% of what you spent on insulation up to $500 for the year.  Granted, that means you would need to spend $5,000 in insulation, but even if you spent $1,000 on insulation, it would be nice to get $100 back when you do your taxes.  Here’s how you can apply for energy tax credits.

Don’t forget to protect pipes and outdoor spigots as well.  Visit your local hardware store for pre-slit pipe insulation and trim to fit the length of the pipes that need insulating.

Every year I winterize my car for less than $100.  A full service oil change, new wiper blades, and an emergency kit are excellent ways to keep your car in the best shape for those cold months.  If you have room in your trunk, you might consider putting a small shovel and extra ice scraper back there for the season.  Last year we lived in an apartment building that didn’t do a great job in clearing the snow.  If we didn’t have a shovel of our own, we would have been forced to take a day off of work like many others who were stranded in the parking lot after a big snowfall!

For every 1 degree that you lower your heat, you’ll save between 1 and 3%.  Take the guesswork out of adjusting your thermostat by investing in a programmable thermostat.  You can pick them up from Lowes or Walmart around $40.

  • Put on extra clothes Instead of turning up the heat, I’ll throw on a hoodie if I’m cold.  Reread tip #4 to see how an extra degree can really add up over time.
  • Keep doors shut and vents closed – If you have a guest bedroom, shut the door, close the vents and seal up the windows.  Why send heat to a part of your house that isn’t being used?
  • Throw on an extra blanket at night. It’s just simple and effective.<


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FOFA will kill small practices, AFA conference told

Many small financial planning practices will fail after the Future of Financial Advice (FOFA) legislation is introduced, Bridges Financial Services CEO Michael Carter has warned.

Speaking yesterday during a panel discussion at the Association of Financial Advisers annual conference on the Gold Coast, he said the cost of providing financial advice will “put a lot of suburban planning practices out of business, and the consumer will be the biggest loser in the whole process”.

Mr Carter says FOFA is a “blunt instrument” that has been applied to all advisers regardless of the quality of their practices.

“The legislation makes no concessions to those existing good practices that are delivering good outcomes for their clients,” he said.

But CommInsure GM Tim Browne believes FOFA will help deliver better advice to clients.

“Improving the fiduciary duty will raise the standard,” he told the conference. “The problem is, I don’t think we have the fiduciary balance right for delivering good advice.”

Compliance Risk Solutions Principal Christina Kalantzis says proposals such as the “opt-in” provisions of the legislation “are a waste of time and of no value”.

“This will become a cost burden and just create more red tape,” she told the conference. “The industry has been getting th


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