Friday Financial Five – July 1, 2016

Friday, July 01, 2016

Dan Forbes, GoLocal Contributor

Brexit fallout still being sorted

The initial shock of the United Kingdom’s decision to leave the European Union is wearing off, and the longer term ramifications are still getting sorted out. Huge drops in global equity markets have been followed by rallies helping several market areas recoup much of the post-Brexit drop. Clarification on how the UK can continue to trade with European Union members may be helping. There’s also a push within Britain to present a second referendum, as it’s reported over a million “leave” voters are reconsidering their decision.

Big banks on better footing

Changes to bank capital requirements since 2009 have led to very positive results in the most recently conducted stress tests by the Federal Reserve. The Fed failed two banks’ capital plans, Deutsche Bank and Santander, and found some issues with some areas of Morgan Stanley. Bank of America, Citigroup, and Ally Financial passed this year after having several issues in the past. The positive results mean these large institutions can buy back more stock and increase dividend payments.

Group pushes presidential candidates on retirement

The Financial Services Roundtable hopes to make retirement stability a major focus of the presidential campaign. They’ve listed ten questions the candidates should address, including how to incentivize small businesses to improve retirement options. Other questions center around automatic enrollment, increasing employer matches, reducing penalties for savers that take early withdrawals, and how the candidates expect to strengthen Social Security in the long term.

Micro-scholarship and loan repayment options

College funding has another possibility in the form of “micro-scholarships”, with Raise.me providing a pathway for over 100 colleges to given money based on academic progress starting in the 9th grade. If nothing else, the venue will give prospective students an apples-to-apples comparison of what the participating schools would offer based on the same yearly grades. The site is probably most applicable to those that will not qualify for need based aid. On a similar note, those that have loans outstanding can look to the CFPB for a “Payback Playbook” . This guideline outlines different loan repayment options to fit the borrower’s income situation.

OJ attorney files for bankruptcy

In recent ESPN series following the rise and fall of OJ Simpson, we were reintroduced to the amazing legal defense team OJ put together for the trial of the century. One of those attorneys, F. Lee Bailey, has added to his list of high profile endeavors by recently declaring bankruptcy. Bailey’s financial woes stem from another case in 1994 where he was paid in shares of a Canadian company. Those shares ended up being worth over $20 million and Bailey has spent the last few decades battling the IRS on the treatment of this payment. Per the bankruptcy, Bailey has assets of $408,000 and liabilities of over $5 million.

Dan Forbes, a CFP Board Ambassador, is a regular contributor on financial issues. He leads the firm Forbes Financial Planning, Inc in East Greenwich, RI and can be reached at [email protected].

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Friday Financial Five – July 1, 2016

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