|
|
|
|
|
|
|
|
Economics 101
"Premium car makers' results roar ahead to pre-crisis highs"
Financial Times, October 29, 2010
Given
that unemployment has barely budged from its 30-year highs and that the
economy is barely growing - the headline above might seem a little
improbable.
The
numbers, however, speak for themselves. High-end European
automakers are at or near record levels of profitability, even as the
European and American economies continue to muddle along at best and
while European governments ponder aggressive new fiscal austerity
measures.
What gives?
One word: China.
According
to the Financial Times, "Mercedes car sales increased 17% to more than
317,000 units in the third quarter [of 2010], to a large extent driven
by a 140% rise in China to 40,748 vehicles. Mercedes sold one in
eight cars in China during this period."
Think
about that for a minute. Mercedes, the number one luxury auto in
the world, already sells one out of every eight of its cars in
China. And this says nothing about its sales to other
fast-growing emerging markets.
Of
course, it is not just fancy autos that the new rich in China are
buying. Luxury fashion, handbags, watches and jewelry are also
booming in this emerging market juggernaut. According to the
Economist, "Chinese luxury sales grew 20% during 2009, one of the worst
global retail years in history, and sales are forecast to grow by
another 30% in 2010. In five years China will likely be the
third-biggest market for luxury goods" (see "Bling is Back," The
Economist, October 23, 2010).
Even
during an extremely difficult economic climate at home, European and
American luxury brands and retailers are enjoying some of their best
years in history by following the money to China and other
up-and-coming countries.
The
Baby Boomers, the largest and wealthiest generation in history, are
trading down and scaling back their lifestyles in order to save for
retirement. Companies that have grown rich catering to the
Boomers-be they large, publically-traded multinationals or modest "mom
and pop" businesses-need to look elsewhere for customers. Companies
that can figure out how to profit from the Echo Boomers-the children of
the Baby Boomers-are potentially building a great business model for
the next 20 years. And of course, companies that can figure out
how to profit from the rise of the new middle class in China and other
emerging markets are also putting themselves in a fine position to
prosper. |
Steps to Retirement Planning
This column often suggests a variety
of ways you can plan for your retirement. Depending on your
situation, some recommendations may be more fitting than others.
But there are certain fundamentals that will apply to everyone.
1. Specify where important financial account information is located.
It may sound like an obvious thing to do, but few people keep a list of
where important records pertaining to the savings, retirement plans,
college-funding plans, mortgage, and insurance reside. Fewer still
could name them all quickly in an impromptu quiz. Keep a master list
and review it annually. If you'd like to receive our "Location List of
Documents," to make sure you don't forget any of the important
documents, simply contact my office and we'll email you a handy
worksheet.
2. Specify where important non-financial information and valuables are located.
Documents such as marriage certificates, birth certificates,
titles/deeds for the house/cars, passports, jewelry, safe deposit box
key, and items in storage facilities should be recorded on a master
list, as well.
3. Specify your final arrangements.
Along with your other important papers, include your wishes regarding
burial or cremation, where you want to be buried, whether you want to
be an organ donor (also should be noted on your driver's license), etc.
These topics can be difficult to
discuss, but by creating lists outlining your wishes and letting at
least one person know where that list is kept, you'll stand a much
better chance of having your wishes carried out - and not being a
burden on your family.
|
Turkey, Football, and Shopping
Of
course, we're talking about the 4-day Thanksgiving holiday that has
become the official beginning of the holiday season in the U.S.
After stuffing both the turkey and themselves on the fourth
Thursday of November, many consumers head out early on the fourth
Friday to fight the crowds for sensational deals. How did the day
now known as "Black Friday" get its name?
Be the first to respond to the email address in contacts and win a holiday prize. |
|
Contact Us
202 West 7th Street
Carroll, IA 51401
Email: federal.info@sklenar.com
phone:
866-792-6668 (toll free)
712-792-6400 (local)
fax: 712-792-6670
|
|
|
Alphabet Soup
FEHB, ACA, HSA and FSA That...is
a lot of acronyms to have attributed to one federal benefit - the
Federal Employees Health Benefit Plan. With the Affordable Care Act's
reform now being implemented, there are sometimes as many questions as
answers when it comes to what it really means to the average federal
employee. Like
any piece of legislation, there were some benefits added and others
taken away or limited. If you have a child between the ages of 22
and 26, you can now add them to your FEHB plan. The limit was
previously age 22, so this puts the federal plan in line with the age
limit of 26 already offered in many states. If
you have a child who has already gone off your FEHB because they
reached age 22, but aren't 26 yet, you can add them back to your plan
during a 90-day window beginning December 1 and ending March 1. If you
are currently in a family plan and you want to stay with the same
insurer, you'll simply download the notification letter from your
insurer's website, complete and send it in during the 90-day
window. But what if you want to change insurers or need to go
from self-only to family coverage? You'll complete SF-2809 (available
from Human Resources or on opm.gov) and use the qualifying life event
code "1C." For
those of you in a Health Savings Account (HSA) (about 3% of federal
employees) associated with a high-deductible health plan, your
reimbursements for over-the-counter drugs and medications will be
eliminated unless you have a doctor's prescription for those
drugs and medications. Insulin is the exception. Your HSA
is also affected by a new penalty clause if you use those funds for
anything other than medical expenses. The penalty was formerly
10%, but effective January 1, that penalty goes to 20% for use of HSA
funds for non-medical expenses. The
same reimbursement limitations for over-the-counter drugs and
medications also applies to your Flexible Spending Account.
Effective January 1, without a doctor's prescription you will no longer
be reimbursed for such things as Advil, Alka-Seltzer Plus, Nyquil, etc.
Again, insulin is the exception. Even
if none of these changes affect you, you'll still want to get the
Outline of Coverage from your current FEHB plan and read Section 2 to
see about the changes in your specific plan during Open Season which
runs from November 8 through December 13. |
|
The Cost of Education
A child born in 2010 that begins kindergarten in the fall of 2015 would attend college between the years of 2028 and 2032. If that child attended an average private 4-year college and if the annual price increases for private colleges experienced over the last 30 years continued into the future, the aggregate 4-year cost of the child's college education (including tuition, fees, room & board) will total $506,423 or nearly $127,000 per year
|
|
TSP Returns
Before listing the October
and year-to-date returns, here's a reminder that the contribution
limits for 2011 will remain at 2010 levels. You may contribute up
to $16,500 during 2011 (remember, this amount does not include the 5%
matching funds provided by the government if you are FERS) and an
additional $5,500 if you are age 50 or better in 2011.
G Fund
October - 0.18%
YTD - 2.42%
F Fund
October - 0.36%
YTD - 8.46%
C Fund
October - 3.80%
YTD - 7.84%
S Fund
October - 4.48%
YTD - 16.70%
I Fund
October - 3.63%
YTD - 4.91%
L Income
October - 0.92%
YTD - 4.23%
L 2010
October - 0.92%
YTD - 4.15%
L 2020
October - 2.29%
YTD - 6.78%
L 2030
October - 2.78%
YTD - 7.76%
L 2040
October - 3.16%
YTD - 8.47%
Returns courtesy of :
|
Unemployment Takes Its Toll
There were 5 unemployed Americans (14.77 million) for every 1 job opening (2.93 million) in the country as of 9/30/10
(source: Department of Labor).
|
|
|
|
|
Letter from the Editor
As we move into the
holiday season and look forward to the upcoming Thanksgiving holiday,
federal employees have much to stop and be thankful for. My clients
often express their gratitude for steady employment with great benefits
that include health insurance, life insurance and a retirement plan.
Personally, I am
thankful for the opportunity to work with so many of you by assisting
you in putting together a financial strategy that provides you with
options, control and peace of mind. Thank you for the trust you place in me to guide you.
Have a wonderful Thanksgiving!
Cordially,
John Sklenar CPA, PFS, CFP ChFEBC - Chartered Federal Employee Benefits Consultant 
|
|
|
