Wednesday, April 3, 2019

Current Personal Finance Events

A recent 18-hour trip (as a passenger) provided an opportunity to review current personal finance events in detail. Below are some financial topics that have been recently making headlines:

¨     Retirement Savings Legislation- The federal Retirement Enhancement and Savings Act is under consideration in Congress and reportedly has widespread bipartisan support. The bill has a number of provisions to open up savings opportunities for more American workers. New Jersey recently passed similarly-motivated legislation: The NJ Secure Choice Savings Act.


¨     Tax Scams- As the 2018 tax season enters its final two weeks, the IRS is warning taxpayers about impersonation scams. Fraudsters call, claim to be from the IRS, and request Social Security numbers or other personal identification information to commit identity theft.


¨     Lower Investment Advisory Fees- Standard advisory fees of one percent of assets under management (AUM) are increasingly being challenged by lower cost services. Competitive investment advisory firms are charging relatively low annual flat fees or AUM fees as low as 0.25% to 0.40% of AUM.


¨     Tax Underwithholding Threshold- The IRS lowered the underwithholding penalty threshold from 90% (and later 85%) of 2018 taxes owed. This change came in response to concerns about tax withholding adequacy in the wake of the Tax Cuts and Jobs Act.


¨     Stock Market Performance- On March 29, the last trading day of the first quarter of 2019, the Standard and Poor’s index had its best first quarter performance since 1998. CNBC referred it as a “stellar quarter.”

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