Friday Financial Five – April 4th, 2014
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Friday, April 04, 2014
Dan Forbes, GoLocalWorcester MINDSETTER™
High frequency trading gets more exposure
While other problems exist in the financial services industry, high frequency trading should be the priority for the SEC. The practice doesn’t pass the smell test, and the recent 60 Minutes piece with Michael Lewis does a good job of explaining the nuances. An argument exists that high frequency trading hasn’t been a focus because it doesn’t greatly harm any individual investor. Instead, it harms millions of investors in extremely small increments and violates the concept of fair trade. The SEC can put an end to this activity or at least dissuade it, possibly with a minimum time between trades or a trade tax. The goal should not be to stifle technological advancement but to create a level playing field between buyer and seller.
401(k) auto-enrollment helping retirement savings
While participation in the stock market is at a low, it appears those making 401(k) contributions is increasing. Auto-enrollment certainly has played a role, as the number of Merrill Lynch 401(k) sponsors using this practice increased by 16 percent in 2013. Merrill also saw a 25 percent increase in those opting for annual contribution increases. Many retirement plans participants adapt to the “forced” contribution and increase, then budgeting based on the remaining take home pay.
Social Security for public-sector workers
Government employees who have contributed to Social Security should really examine their benefits to ensure proper projected retirement income. WEP (Windfall Elimination Provision) rules and the Government Pension Offset can both reduce estimated benefits. The WEP reduction is maximized at one-half of the pension. The Government Offset factors into spousal and survivor benefits and can amount to two-thirds of the pension. Those in public service must be mindful of these provisions to properly forecast retirement income.
The cost of Alzheimer’s
A recent program by the Alzheimer’s Association highlighted the immediate need to address this not only as an obvious health issue, but to mitigate the overwhelming cost associated with caring for those affected. Alzheimer’s is the most expensive condition in the nation, costing $214 billion in 2014 and expected to climb to over $1 trillion by 2050. It accounts for 20% of all Medicare expense, with a total of $150 billion spent by Medicare and Medicaid combined. Out of pocket spending accounts for over $30 billion. This ailment may single-handedly threaten the sustainability of the entitlement programs, while simultaneously driving up the cost of Long Term Care coverage to prohibitive levels.
Madoff trustee looking for approval on another payout
It’s been over 5 years since Bernie Madoff’s investment firm failed. If approved by a bankruptcy judge, the most recent settlement agreement would bring total payouts to defrauded investors to almost $6 billion. Irving Picard, the trustee, most recently is looking for permission to pay out close to $350 million, the bulk of which comes as a settlement with JP Morgan Chase. Mr Picard’s legal team is not working pro-bono, as their recently submitted request for $39 million in fees would swell the total legal bill for this debacle to over $500 million.
Dan Forbes is a regular contributor on financial issues. He is a CFP Board Ambassador. He leads the firm Forbes Financial Planning, Inc in Providence, RI and can be reached at [email protected] .
Related Slideshow: 2014 Auto Insurance Rates in Central MA
Using a defined set of criteria, GoLocal utilized the Auto Insurance Premium Comparison tool from the Massachusetts Office of Consumer Affairs and Business Regulation to compile and rank the cities and towns of Central Massachusetts with the highest auto insurance premiums - lowest to highest.
The Criteria
Vehicle: 2008 Honda Civic LX
Policy: Single Vehicle, Single Operator Licensed 14 Years
Driving Record/Behaviors:
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Driver Licensed in Massachusetts: Yes
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Date of last accident or traffic violation: 5 years ago
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Days lapse in coverage during the previous 3 years: None
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Commutes to work: Yes
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Annual miles vehicle driven in past year: 15,000
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Years at current residence: 2
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Years with current agent: 3
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Years with current company: 2
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Discrepancies on Application: 0
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Subscriber to a Roadside Assitance Organization: No
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Policy Eligible for a Group Discount: No
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Premium paid in full at inception: No
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Companion insurance products purchased: None
Coverage:
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$20,000/$40,000 Bodily Injury Liability
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$20,000/$40,000 Uninsured Motorists
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$20,000/$40,000 Underinsured Motorist
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$25,000 Property Damage Liability
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$8,000 Personal Injury Protection ($0 deductible)
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71. Templeton
Highest Premium: $602.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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70. Upton
Highest Premium: $620.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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69. New Braintree
Highest Premium: $620.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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68. Millville
Highest Premium: $640.00
Lowest: $234.00
All premiums reflect rates effective on 1/1/14
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67. Hubbardston
Highest Premium: $640.00
Lowest: $234.00
All premiums reflect rates effective on 1/1/14
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66. Holland
Highest Premium: $640.00
Lowest: $234.00
All premiums reflect rates effective on 1/1/14
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65. West Boylston
Highest Premium: $640.00
Lowest: $268.00
All premiums reflect rates effective on 1/1/14
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64. Ashby
Highest Premium: $642.00
Lowest: $234.00
All premiums reflect rates effective on 1/1/14
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63. Westminster
Highest Premium: $651.00
Lowest: $234.00
All premiums reflect rates effective on 1/1/14
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62. Lunenburg
Highest Premium: $653.00
Lowest: $234.00
All premiums reflect rates effective on 1/1/14
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61. Townsend
Highest Premium: $655.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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60. Northborough
Highest Premium: $659.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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59. Orange
Highest Premium: $663.00
Lowest: $268.00
All premiums reflect rates effective on 1/1/14
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58.East Brookfield
Highest Premium: $663.00
Lowest: $268.00
All premiums reflect rates effective on 1/1/14
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57. Barre
Highest Premium: $663.00
Lowest: $268.00
All premiums reflect rates effective on 1/1/14
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56. Warren
Highest Premium: $663.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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55. Ware
Highest Premium: $663.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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54. Winchendon
Highest Premium: $666.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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53. Petersham
Highest Premium: $671.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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52. Sterling
Highest Premium: $672.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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51. Brimfield
Highest Premium: $679.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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50. Ashburnham
Highest Premium: $687.00
Lowest: $234.00
All premiums reflect rates effective on 1/1/14
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49. North Brookfield
Highest Premium: $692.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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48. Shirley
Highest Premium: $693.00
Lowest: $268.00
All premiums reflect rates effective on 1/1/14
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47. Brookfield
Highest Premium: $693.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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46. Uxbridge
Highest Premium: $698.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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45. Northbridge
Highest Premium: $698.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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44. Gardner
Highest Premium: $698.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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43. Ayer
Highest Premium: $698.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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42. Athol
Highest Premium: $698.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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41. Sturbridge
Highest Premium: $702.00
Lowest: $234.00
All premiums reflect rates effective on 1/1/14
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40. Topsfield
Highest Premium: $702.00
Lowest: $291.00
All premiums reflect rates effective on 1/1/14
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39. Charlton
Highest Premium: $703.00
Lowest: $291.00
All premiums reflect rates effective on 1/1/14
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38. Sutton
Highest Premium: $704.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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37. Hopkinton
Highest Premium: $705.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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36. Oakham
Highest Premium: $705.00
Lowest: $234.00
All premiums reflect rates effective on 1/1/14
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35. Hudson
Highest Premium: $705.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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34. Douglas
Highest Premium: $706.00
Lowest: $268.00
All premiums reflect rates effective on 1/1/14
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33. Harvard
Highest Premium: $707.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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32. West Brookfield
Highest Premium: $708.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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31. Paxton
Highest Premium: $714.00
Lowest: $300.00
All premiums reflect rates effective on 1/1/14
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30. Boylston
Highest Premium: $716.00
Lowest: $268.00
All premiums reflect rates effective on 1/1/14
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29. Bolton
Highest Premium: $719.00
Lowest: $234.00
All premiums reflect rates effective on 1/1/14
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28. Dudley
Highest Premium: $719.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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27. Palmer
Highest Premium: $719.00
Lowest: $291.00
All premiums reflect rates effective on 1/1/14
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26. Royalston
Highest Premium: $721.00
Lowest: $234.00
All premiums reflect rates effective on 1/1/14
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25. Oxford
Highest Premium: $727.00
Lowest: $300.00
All premiums reflect rates effective on 1/1/14
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24. Westborough
Highest Premium: $728.00
Lowest: $268.00
All premiums reflect rates effective on 1/1/14
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23. Millbury
Highest Premium: $744.00
Lowest: $291.00
All premiums reflect rates effective on 1/1/14
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22. Hardwick
Highest Premium: $746.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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21. Milford
Highest Premium: $746.00
Lowest: $300.00
All premiums reflect rates effective on 1/1/14
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20. Marlborough
Highest Premium: $746.00
Lowest: $300.00
All premiums reflect rates effective on 1/1/14
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19. Leominster
Highest Premium: $746.00
Lowest: $300.00
All premiums reflect rates effective on 1/1/14
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18. Clinton
Highest Premium: $746.00
Lowest: $310.00
All premiums reflect rates effective on 1/1/14
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17. Auburn
Highest Premium: $746.00
Lowest: $310.00
All premiums reflect rates effective on 1/1/14
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16. Hopedale
Highest Premium: $749.00
Lowest: $268.00
All premiums reflect rates effective on 1/1/14
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15. Lancaster
Highest Premium: $755.00
Lowest: $268.00
All premiums reflect rates effective on 1/1/14
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14. Southbridge
Highest Premium: $759.00
Lowest: $310.00
All premiums reflect rates effective on 1/1/14
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13. Rutland
Highest Premium: $766.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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12. Fitchburg
Highest Premium: $770.00
Lowest: $332.00
All premiums reflect rates effective on 1/1/14
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11. Princeton
Highest Premium: $773.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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10. Holden
Highest Premium: $773.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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9. Leicester
Highest Premium: $773.00
Lowest: $332.00
All premiums reflect rates effective on 1/1/14
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8. Mendon
Highest Premium: $779.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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7. Southborough
Highest Premium: $780.00
Lowest: $217.00
All premiums reflect rates effective on 1/1/14
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6. Webster
Highest Premium: $786.00
Lowest: $332.00
All premiums reflect rates effective on 1/1/14
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5. Spencer
Highest Premium: $805.00
Lowest: $310.00
All premiums reflect rates effective on 1/1/14
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4. Blackstone
Highest Premium: $829.00
Lowest: $268.00
All premiums reflect rates effective on 1/1/14
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3. Grafton
Highest Premium: $850.00
Lowest: $276.00
All premiums reflect rates effective on 1/1/14
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2. Shrewsbury
Highest Premium: $865.00
Lowest: $300.00
All premiums reflect rates effective on 1/1/14
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1. Worcester
Highest Premium: $997.00
Lowest: $440.00
All premiums reflect rates effective on 1/1/14
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