Business – Finance – Page 95

Wildfire smoke puts Chicago among cities with worst air quality in the world

The Washington Post

Wildfire smoke puts Chicago among cities with worst air quality in the world

It’s the latest in a series of smoke invasions from Canada this month.

Ian Livingston – June 27, 2023

Chicago’s skyline is draped in heavy smoke from the Canadian wildfires on Tuesday. (Kamil Krzaczynski/AFP/Getty Images)

A new round of dense smoke has invaded the United States, specifically the Great Lakes region, as wildfires munch through forests across Quebec and Ontario, with more than 3.7 million acres scorched over the last week in those provinces alone. Throughout Tuesday, Chicago air quality ranked as the worst in the world among major cities.

Minneapolis and Detroit joined Chicago among the 10 worst, all dealing with conditions no better than Code Red. Air quality was even worse in other locations, such as Waukesha, Wis., west of Milwaukee, where the more severe Code Maroon was reached. Grand Rapids, Mich. — which through Tuesday has been between Red and Maroon, at Code Purple — is among places from eastern Iowa through Michigan and into Ontario that have endured air in this bout that is very unhealthy or worse.

Air quality alerts will be in effect into Wednesday or Thursday from Minnesota and Iowa through most of the Midwest, the Great Lakes region, and into parts of the Northeast, Mid-Atlantic and the Carolinas.

The Air Quality Index (AQI) moves to Code Orange (unhealthy for sensitive groups) at a reading of 101. Code Red (unhealthy for everyone) starts at 151. Once reaching 201, it’s Code Purple (very unhealthy), and finally a Code Maroon (hazardous) begins at 301.

Wildfire smoke’s primary pollutant is often referred to as PM2.5. These are fine particles from burned organic matter less than or equal to 2.5 microns in diameter — a microscopic soot.

The latest on the Canadian wildfires and smoke

Haze obscures the skyline in Cedar Rapids, Iowa, on Tuesday, June 27, 2023. (Nick Rohlman/The Gazette via AP)

Canada is experiencing its worst fire season in modern history. Smoke from wildfires in Canada has also brought record-breaking air pollution to the United States, creating unhealthy air quality conditions from the Midwest to the East Coast. Check to see how bad wildfire smoke has been in your area.

The plume on Tuesday

A thick pall of smoke was draped from Quebec and Ontario to the southwest, toward parts of the Midwest and Great Lakes region, and began moving into the Ohio Valley and points east in the early evening. The worst of it late Tuesday was centered over Lake Michigan and surrounding states. A particularly thick patch of smoke was approaching Chicago from the north late afternoon.

In Michigan and surrounding areas, it was a mix of smoke and low clouds.

Smoke is visible in this satellite image Tuesday morning. (Colorado State/CIRA)

Air quality values as severe as Code Purple have been recorded in Iowa, Wisconsin, Michigan, Illinois and northern Indiana so far, with an hourly AQI near Milwaukee of 312 and climbing, according to an Environmental Protection Agency monitor late afternoon. The Canadian city of Sault Ste. Marie, on the international border of Michigan, reached an AQI reading Monday night as high as 353, which is Code Maroon. The city was under Code Purple for much of Tuesday.

Many more locations, from eastern Minnesota to the western slopes of the Appalachians, were seeing Code Red conditions. The thickest of the smoke plume had advanced as far east as Cincinnati and Akron, Ohio.

In Chicago, the National Weather Service wrote that “low visibility due to wildfire smoke will continue today. Consider limiting prolonged outdoor activities.”

Visibility in the city was down to two miles, with smoke reported from Chicago O’Hare International Airport. The Weather Service expected visibility of one to three miles across the region for much of Tuesday.

“You can literally smell the smoke in the air today in Chicago from the Canadian wildfires,” wrote a Twitter user.

Into Wednesday, smoke should keep slowly moving east and somewhat south. It should remain in the lower Great Lakes and push into the Midwest or Ohio Valley region. Some of the smoke was beginning to spill over into the Appalachians late Tuesday.

Many such days

The number of days at Code Orange or worse as a result of wildfire smoke continues to increase in the northeastern United States, though that number is comparatively low when examined against areas immediately surrounding the fires in Canada.

Many of these days also saw spikes beyond Code Orange.

U.S. cities among the worst air quality in the world Tuesday morning. (IQAir)

This month but before the current wave, much of western Wisconsin — in the thick again — had already recorded four or five 24-hour readings at Code Orange or higher. It’s a similar story in and around Detroit, with five Code Orange days in the city and up to seven or eight in nearby locations.

Wildfire smoke, air quality and your health

(Photo by AFP PHOTO / Nova Scotia Government) (Handout/AFP/Getty Images)

Wildfire smoke can travel great distances, with particulates small enough to enter the bloodstream through your lungs if inhaled. If you’re in an area affected by smoke, limit your outdoor activities (especially when exercising) and wear a good mask outside that can filter fine particles. Here’s how to protect yourself from wildfire smoke.End of carousel

More than a dozen days at Code Orange or worse have been tallied in June across the hardest-hit spots north of the border, in Ontario and Quebec, especially north and northwest of Ottawa.

The D.C. region just saw its worst smoke pollution on record

The number of bad air quality days may soon increase in the Northeast, as well. The Washington, D.C., region has had two bad air days this month, both Code Red. Much of Pennsylvania and New Jersey and parts of Southern New England have piled up three such days, with a few locations at four or five.

While AQI values in this plume are somewhat lower than they were earlier in the month — when hourly AQI values soared toward 400 in the Northeast — any values of Code Red or above are concerning for the general public.

Smoke’s future travel plans

This round of smoke, like the one June 7-8 that smothered the Northeast, is moving into circulation via a crawling low-pressure area that’s now over the eastern Great Lakes.

In general, winds blow from the east to the north of the low pressure center, pushing smoke westward from the source, before winds out of the north and northwest behind the center push smoke south. As the low pressure inches east, so does the area of smoke it is carrying along with it.

Over the next several days, the low should track through the Mid-Atlantic and offshore along the East Coast. This trajectory is expected to bringsmoke eastward.

Code Red is now in the forecast Wednesday for Buffalo, Pittsburgh, Cleveland and Columbus, Ohio, on the eastern side of the thickest plume. Code Orange is forecast for Syracuse, N.Y., Baltimore, Washington and Raleigh, N.C.

Smoke forecast through Wednesday, from the HRRR weather model. (NOAA)

Higher-level smoke will likely cover a larger area from the northern and central Plains, through the Midwest and Great Lakes region, then through the Mid-Atlantic and as far south as Georgia on Wednesday.

The potential for smoky skies could last into the weekend, although it will probably drop in intensity as the pattern shifts slightly.

Canadian wildfire smoke

Latest news: Why are Canada’s wildfires getting worse? Meteorologists aren’t sure how long fires will persist, but it’s already Canada’s worst fire season in modern history. Smoke from Canadian wildfires has spread over much of the Midwest, Northeast and Mid-Atlantic.

Air quality and your health: Breathing in wildfire smoke is bad for your health. The EPA uses a color-coded system to measure air quality — here’s what Code Red, Code Purple and more mean. Learn how to protect yourself including which air filters and air purifiers to choose for your home.

Environmental impact: Wildfires send greenhouse gases into the air, but Canada doesn’t count some of them as part of its official emissions contributions, a Post report found.

North Carolina GOP bars promotion of certain beliefs in state government, 1 of 6 veto overrides

Associated Press

North Carolina GOP bars promotion of certain beliefs in state government, 1 of 6 veto overrides

Gary D. Robertson – June 27, 2023

FILE – Democratic North Carolina Gov. Roy Cooper speaks to The Associated Press in a year-end interview at the Executive Mansion in Raleigh, N.C., Dec. 14, 2022. On Friday, June 16, 2023, Cooper vetoed GOP legislation that would ban the promotion of certain beliefs that some lawmakers have likened to critical race theory in state government workplaces. (AP Photo/Hannah Schoenbaum, File) (ASSOCIATED PRESS)

RALEIGH, N.C. (AP) — North Carolina’s GOP-dominated legislature swept six bills into law Tuesday with veto overrides, including one barring promotion of certain beliefs in state government workplaces that some lawmakers liken to critical race theory and another placing new limits on wetlands protection rules.

The measures, which also address green investing in state government, consumer loans and local government finances, became law after a succession of votes with margins large enough to overcome Democratic Gov. Roy Cooper’s formal vetoed objections earlier this month.

Five of the veto overrides were completed Tuesday with House votes, which followed several similar Senate votes over the past week. A sixth veto override effort cleared both the House and Senate on Tuesday.

The state constitution deems an override successful if at least three-fifths of the members in each chamber present and voting agree to enact the bill anyway despite the governor’s objections.

The overrides exemplify the expanded political muscle of Republicans after electoral seat gains last fall and a House Democrat’s party switch in April gave them exact veto-proof majorities in each chamber for the first time since late 2018. Cooper had been able to block several dozen GOP measures over the previous four years with vetoes because there were enough Democrats supporting his efforts.

Several of Tuesday’s override votes in the House included support from a few Democrats. Still, Republicans needed to ensure that enough of their party colleagues were in attendance to complete overrides.

Among the bills enacted Tuesday is the legislature’s annual farm bill, which contains more than 30 provisions such as penalties for cutting down timber, waiting periods for regulators to inspect veterinarians’ offices and the establishment of an official “Farmers Appreciation Day” in November.

Cooper’s farm bill veto came Friday. He said the measure would weaken the regulation of wetlands that help control flooding and pollution. His administration and environmental groups have said the bill’s language, when combined with a recent U.S. Supreme Court decision, would leave about half of the state’s wetlands unprotected.

Republicans and their allies blunted the impact of the bill’s language on wetlands, saying it would affect largely affect isolated terrain that rarely floods and align standards with federal law.

Another now-enacted law that takes effect in December bans trainers of state employees from advancing concepts to workers such as that “one race or sex is inherently superior to another race or sex,” or to believe they should feel guilty for past actions committed by people of the same race or sex. It also would prohibit hiring managers for state agencies, community colleges and the University of North Carolina system from compelling applicants for policy-making jobs to reveal their personal or political beliefs as a condition of employment.

In his veto message, Cooper said the bill attempts to suppress workplace discussions related to diversity, equity and inclusion that can reveal “unconscious bias we all bring to our work and our communities.” But supporters of the bill said it actually encourages a diverse set of beliefs within public agencies.

Both the House and Senate voted Tuesday to override the veto of a measure that now ban state agencies from using “environmental, social and governance” standards to screen potential investments, award contracts or hire and fire employees.

On state investments like those in pension funds, the bill says the state treasurer could solely consider factors expected to have a material effect on the financial risk or financial return of an investment.

At least two other states have already enacted laws banning such criteria. Republicans nationwide has raised questions about big business focusing upon environmental sustainability and workplace diversity so much that it harms shareholders and pensioners.

Cooper said in his veto message late week that the measure would needlessly limit the treasurer’s ability to make investment decisions that are in the best interests of the state retirement fund.

Other bills enacted over Cooper’s vetoes in part would raise interest rates and late fees on certain amounts of personal consumer finance loans as well as on consumer credit sales, such as when someone buys a car and pays for it in installments or with a finance charge. Cooper said the higher costs, which would take effect in October on new, renewed or modified loans, would harm residents who already are faced with rising costs of living.

Another bill with a veto now overridden would permit the state’s Local Government Commission to order withheld a portion of sales tax revenues the state collects for cities and counties that fail to complete annual audits of their accounts. Bill supporters said the measure will promote government accountability. Cooper said it was well-intentioned but would likely hurt the state’s smallest communities.

HELOCs are back. Cash-strapped borrowers are tapping into a $33 trillion pile of home equity.

MarketWatch – In One Chart

HELOCs are back. Cash-strapped borrowers are tapping into a $33 trillion pile of home equity.

Joy Wiltermuth – June 26, 2023

Banks hold most HELOCs

Borrowers are increasingly tapping into a pile of home equity for liquidity. **JUSTIN SULLIVAN/GETTY IMAGES**

Goodbye pandemic refi cash-outs. Hello HELOCs?

Home-equity lines of credit (HELOCs) and second-lien mortgages have been staging a notable comeback as U.S. homeowners look for liquidity and ways to monetize the pandemic surge in home prices, according to BofA Global.

It used to be that borrowers sitting on an estimated $33 trillion pile of equity built up in their homes could simply refinance and pull out cash, until the Federal Reserve’s rapid rate hikes began squelching the option.

Now, with mortgage rates above 6%, and the Fed penciling in two more rate hikes in 2023, cash-strapped homeowners have been seeking out alternatives to extract cash from their properties.

While cash-out refinances tumbled 83% in the fourth quarter of 2022 from a year before, HELOCs rose 7% and home-equity loans grew 31%, according to the latest TransUnion data.

“Borrower demand remains high, particularly given household budgets have been pressured by rising food and energy costs,” a BofA Global credit strategy team led by Pratik Gupta’s, wrote in a weekly client note.

Risky loans to subprime borrowers and home equity products helped precipitate the 2007-2008 global financial crisis and the era’s wave of devastating home foreclosures.

At the time, households had more than $1.2 trillion of home equity revolving and available credit (see chart), whereas the figure was closer to $900 billion in the first quarter of this year.

Home equity products are making a big comeback as households seek liquidity **BOFA GLOBAL, NEW YORK FED CONSUMER CREDIT PANEL/EQUIFAX**

The pandemic saw home prices surge, giving a big boost to home equity levels. The Urban Institute pegged home equity in the U.S. at $33 trillion as of May, up from a post-2008 peak of about $15 trillion.

BofA analysts argued this time home equity products look different, with roughly $17 trillion of tappable equity across 117 million U.S. homeowners, and most borrowers having high credit scores and low rates.

“The vast majority of that — $14 trillion — is from the cohort of homeowners who own their homes free & clear,” Gupta’s team wrote.

Another $1.6 trillion of equity could be available from Freddie Mac and Fannie Mae borrowers, according to his team, which pegged an estimated 94% of all outstanding U.S. first-lien home mortgages now below 4% rates.

Major banks own the bulk of home equity balances (see chart), led by Bank of America Corp. BAC, +1.23%, PNC Bank PNC, +0.57%, Wells Fargo, WFC, -0.05%, JPMorgan Chase JPM, +0.24% and Citizens CFG, +0.35%, according to the team, which notes several other major banks appear to have hit pause on their programs.

A smaller portion of HELOCs and second-lien mortgages have been securitized, or packaged up and sold as bond deals, while nonbank lenders have been offering the products as well.

Major Cuts to Social Security Are Back on the Table — What’s Being Proposed Now?

Go Banking Rates

Major Cuts to Social Security Are Back on the Table — What’s Being Proposed Now?

Vance Cariaga – June 22, 2023

A group of Republican lawmakers aims to balance the federal budget and slash government spending by targeting programs like Social Security — and some seniors could see a major reduction in lifetime benefits if the plan makes it into law.

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The proposal was unveiled June 14 by U.S. House conservatives, Bloomberg reported. One of its main features is to raise the full retirement age (FRA) at which seniors are entitled to the full benefits they are due.

The 176-member House Republican Study Committee (RSC) approved a fiscal blueprint that would gradually increase the FRA to 69 years old for seniors who turn 62 in 2033. The current full retirement age is 66 or 67, depending on your birth year. For all Americans born in 1960 or later, the FRA is 67.

As Bloomberg noted, workers expecting an earlier retirement benefit will see lifetime payouts reduced if the full retirement age is raised. Those payouts could be drastically reduced for seniors who claim benefits at age 62, when you are first eligible.

Lawmakers on both sides of the political aisle have been working to come up with a fix for Social Security before the program’s Old Age and Survivors Insurance (OASI) Trust Fund runs out of money. That could happen within the next decade or so. When it does, Social Security will be solely reliant on payroll taxes for funding — and those taxes only cover about 77% of current benefits.

While most Democrats want to boost Social Security through higher payroll taxes or reductions to benefits for wealthy Americans, the GOP has largely focused on paring down or privatizing the program.

As previously reported by GOBankingRates, House Speaker Kevin McCarthy (R-Calif.) recently told Fox News that this month’s debt limit bill was only “the first step” in a broader Republican agenda that includes further cuts.

“This isn’t the end,” McCarthy said. “This doesn’t solve all the problems. We only got to look at 11% of the budget to find these cuts. We have to look at the entire budget. … The majority driver of the budget is mandatory spending. It’s Medicare, Social Security, interest on the debt.”

As Bloomberg noted, Republicans argue that failing to change Social Security could lead to a 23% benefit cut once the trust fund is depleted. Raising the retirement age is a way to soften the immediate impact. The RSC said its proposal would balance the federal budget in seven years by cutting some $16 trillion in spending and $5 trillion in taxes.

“The RSC budget would implement common-sense policies to prevent the impending debt disaster, tame inflation, grow the economy, protect our national security, and defund [President Joe] Biden’s woke priorities,” U.S. Rep. Ben Cline (R-Va.), chairman of the group’s Budget and Spending Task Force, told Roll Call.

Democrats were quick to push back against the proposal.

“Budget Committee Democrats will make sure every American family knows that House Republicans want to force Americans to work longer for less, raise families’ costs, weaken our nation, and shrink our economy — all while wasting billions of dollars on more favors to special interests and handouts to the ultra-wealthy,” U.S. Rep. Brendan Boyle, (D-Pa.), the Budget Committee’s top Democrat, said in a statement.

Social Security: No Matter Your Age, Do Not Claim Benefits Until You Reach This Milestone
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Meanwhile, White House Press Secretary Karine Jean-Pierre issued a statement saying the RSC budget “amounts to a devastating attack on Medicare, Social Security, and Americans’ access to health coverage and prescription drugs.”

Although the proposal might make it through the GOP-led House, it’s unlikely to become law – at least while Biden is still president. Even if a bill somehow got approved by the Democrat-controlled Senate, Biden would almost certainly veto it.

Titanic submersible: 5 passengers on missing sub likely dead following ‘catastrophic implosion’

Yahoo! News

Titanic submersible: 5 passengers on missing sub likely dead following ‘catastrophic implosion’

Christopher Wilson – June 22, 2023

The Coast Guard announced Thursday that it believed the five passengers who disappeared while attempting to explore the Titanic shipwreck were likely lost due to a “catastrophic implosion” of their vessel.

U.S. Coast Guard Rear Adm. John Mauger announced at a press conference that on Thursday morning, five major pieces of debris had been found on the seafloor about 1,600 feet from the site of the Titanic, a finding “consistent with the catastrophic loss of the pressure chamber.” Mauger said they then notified the families and offered their condolences.

Shortly before Mauger’s comments, the company running the expedition, OceanGate, announced that the five passengers “have sadly been lost.”

OceanGate's tourist submersible vessel. — OceanGate’s tourist submersible vessel. (OceanGate/Handout via Getty Images)

“These men were true explorers who shared a distinct spirit of adventure, and a deep passion for exploring and protecting the world’s oceans,” read the statement. “Our hearts are with these five souls and every member of their families during this tragic time.”

The grim announcement came four days after a 21-foot tourist submersible named the Titan was reported missing approximately 900 miles east of Cape Cod, triggering a massive search to find the vessel before its occupants ran out of oxygen.

The Titan had been projected to run out of its 96-hour supply of breathable air on Thursday morning. And because the door was bolted from the outside, those inside would not have been able to open it on their own even if they were able to reach the surface. Asked about the possibility of recovering remains, Mauger called the conditions “unforgiving” and said there weren’t prospects for doing so at this time.

A missing sub and extensive search

The five occupants of the Titan and the Titan. — The five occupants of the Titan: Stockton Rush, Hamish Harding, Shahzada Dawood, Paul-Henri Nargeolet and Suleman Dawood, and the Titan. (Shannon Stapleton/Reuters; Courtesy of Jannicke Mikkelsen via Reuters; Courtesy of Engro Corporation Limited via Reuters; J. Sagat/AFP via Getty Images; Courtesy of Engro Corporation Limited via Reuters; OceanGate/Handout/Anadolu Agency via Getty Images)More

The Titan, operated by OceanGate, a private exploration company based in Everett, Wash., launched early Sunday morning to tour the Titanic wreckage with five passengers on board: OceanGate CEO Stockton Rush, 61; British billionaire and explorer Hamish Harding, 58; Pakistani businessman Shahzada Dawood, 48, and his 19-year-old son, Suleman; and Paul-Henri Nargeolet, a 77-year-old French explorer.

The Polar Prince, a Canadian research vessel and support ship for the expedition, lost contact with the submersible about an hour and 45 minutes after launch. OceanGate reported the Titan missing on Sunday evening, triggering a massive international search effort led by the U.S. Coast Guard and assisted by the U.S. Air Force, Navy, Air National Guard, Royal Canadian Navy and Canadian Coast Guard.

Troubling signs

OceanGate's tourist submersible on the surface of the sea. — OceanGate’s tourist submersible on the surface of the sea. (OceanGate/Handout/Anadolu Agency via Getty Images)

Founded in 2009, OceanGate charges up to $250,000 per person for a chance to visit the remnants of the Titanic, which sank in 1912 on its inaugural trip from England to New York. While Rush stated last year that the submersible had made it down to the wreckage a dozen times over the last two years, there had been a number of red flags about the operation. In 2018, more than three dozen oceanographers and deep-sea explorers wrote a letter to OceanGate warning that its “experimental” approach could lead to “catastrophic” consequences for its Titanic dives.

A 10-minute segment from CBS News Sunday Morning in November 2022 foreshadowed the tragedy. Journalist David Pogue discussed some of the paperwork he had to sign in an almost humorous tone, reading, “This experimental vessel has not been approved or certified by any regulatory body, and could result in physical injury, emotional trauma, or death,” before adding, “Where do I sign?”

In the 2022 piece, Pogue noted that while he was on the expedition the submersible never made it to the wreck site because of communications errors. He quoted one passenger as saying, “We were lost for two and a half hours.” Pogue’s own scheduled trip to the Titanic was canceled due to poor weather, and a back-up excursion to the trip to a Continental Shelf was called off due to technical difficulties after 37 feet of descent.

In a tweet Monday, Pogue said the craft was, in fact, lost for five hours and that adding an emergency locator beacon was discussed. Pogue added, “They could still send short texts to the sub, but did not know where it was. It was quiet and very tense, and they shut off the ship’s internet to prevent us from tweeting.” The company cited the need to keep “all channels open” as a reason for cutting off internet access, he said.

Another former passenger on the Titan told the BBC on Tuesday said he had to sign a “death waiver” that “lists one way after another that you could die on the trip,” including “[mentioning] death three times on page one, and so it’s never far from your mind.”

Working Longer Won’t Help Most Americans Actually Max Out Social Security

Smart Asset

Working Longer Won’t Help Most Americans Actually Max Out Social Security

Brian J. O’Connor – June 21, 2023

Working Longer to Max Out Social Security May Fail Most Workers

The idea of working longer before claiming Social Security benefits sounds like a great retirement strategy. Staying on the job means you can maximize your eventual benefit, continue to save for retirement and avoid tapping your investments to cover living expenses.

There’s just one problem: working longer is an unrealistic option for many. That’s the finding of the new book, “Overtime: America’s Aging Workforce and the Future of Working Longer,” a collection edited by Lisa F. Berkman and Beth C. Truesdale, and published by Oxford University Press.

A financial advisor can help you decide when the right time is to retire. Find a fiduciary advisor today.

“Though today’s middle-aged adults are less financially prepared for retirement than today’s retirees, delayed retirement is not an adequate solution,” the editors write. “Precarious working conditions, family caregiving responsibilities, poor health, and age discrimination make it difficult or impossible for many to work longer.”

A Look at the Numbers

That conclusion is borne out by the Social Security Administration’s own statistics. While nearly 13% of workers nearing retirement say they’ll wait to claim the biggest possible payout, only 5% of people wait to claim benefits at age 70. Instead, about one-quarter of all men and one-third of all women opt to collect benefits as soon as become eligible at age 62.

Even worse, the administration notes that “[m]ore than one in eight of today’s 20-year-olds will die before reaching age 67.”

Nonetheless, financial advisers continue to promote the idea of waiting to maximize your benefit. On paper, it’s an idea that makes perfect sense: delaying your benefits from the full retirement age of 67 to 70 adds 8% to your benefit amount each year, a cumulative 32% increase in benefit cash. And, since Social Security benefits adjust with inflation, a bigger initial benefit means a bigger increase from the cost-of-living adjustments.

If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.

The Problem With Working Longer

As a 2022 report from the National Bureau of Economic Research noted, “Americans are notoriously bad savers. Large numbers are reaching old age too poor to finance retirements that could last longer than they worked.” The study concluded that “virtually all American workers age 45 to 62 should wait beyond age 65 to collect. More than 90 percent should wait till age 70.”

The idea makes sense and the “Overtime” editors agree. “Longer life expectancies mean that Americans need income to support more years of life, and working longer is a commonly proposed solution,” they write.

However, they cite five different factors that undermine the concept of working longer to boost retirement income, including “Trends and inequalities in American demographics, health, family dynamics, jobs, and politics,” which are often not factored in.

The editors outline an array of possible solutions. “Robust retirement and disability policies are essential complements to working-longer policies.” They add that, “Working-longer policies must be supported by ‘good jobs’ policies to succeed.”

Bottom Line

Working longer and delaying retirement is a common strategy recommended to people who aren’t financially ready to retire. But a new book from Lisa F. Berkman and Beth C. Truesdale argues this alternative is unrealistic for many. Working conditions, caregiving responsibilities, health problems and age discrimination make it increasingly difficult for older Americans to continue to work.

Retirement Planning Tips

How much money will you need to save to be able to retire? Should you delay Social Security? These are just a couple questions that pre-retirees face. A financial advisor can help you answer them. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Fidelity recommends that you have 10 times your annual income saved for retirement by age 67. To find out if you’re on track, try SmartAsset’s retirement calculator. This free tool will estimate how much you’ll have when the time comes to retire.

Photo credit: ©iStock.com/PixelsEffect, ©iStock.com/FG Trade, ©iStock.com/ferrantraite

Expert Says Too Many Americans Are Cashing Out Their 401(k) Plans

Smart Asset

Expert Says Too Many Americans Are Cashing Out Their 401(k) Plans

Ben Geier – Jun 22, 2023

SmartAsset: Too Many People Are Cashing Out Their 401(k) Plans

When leaving a job, there are a lot of things you have to remember to do when you leave – clean out your desk, say goodbye to your coworkers and pack up your secret stash of candy, for instance. Another thing you have to do, of course, is take care of your retirement plan. There are several options, and according to a new study from Harvard Business Review, too many people are choosing to completely drain their account and take it in cash. There are a number of reasons why this is not the best option for dealing with retirement funds from a company you are leaving.

For help managing your own retirement savings, consider working with a financial advisor.

401(k) Options When Leaving a Job

When you leave a job, you have four basic options for handling your 401(k):

Keep it with your old employer. You do have the option of simply leaving your money in the plan at your old company. If you have less than $5,000, it’s worth noting your company can force you to take it or transfer it. Leaving your money with your old company also means when you want to access your funds in the future, you’ll have to deal with a company you may have long since left, which could cause some issues.
Rollover to an IRA. One of the most popular options in this situation is to take your money out of your 401(k) and put it into an individual retirement account. You can then reinvest in a buffet of options – and you can continue to put money into the account periodically.
Rollover to a new employer’s plan. There is another rollover option available – taking the money from your old account and putting it into the plan at your new employer. You can then continue to put money into the new plan and have all your retirement savings in one place.
Cash it out. Your final option – which will be explored more below – is to take the money out in cash.

If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.

Harvard’s Findings

Harvard Business Review cites data that in a survey of 160,000 employees in the United States between 2014 and 2016, 41.4% cashed out at least some of their 401(k) balance when leaving a job. Furthermore, 85% of those people took out the entire balance.

Generally speaking, this isn’t a great choice when it comes to planning for retirement. If you take money out of your retirement plan, it’s no longer growing in the market, and may not last until you retire.

Why, then, do so many people liquidate their 401(k) accounts when they leave a job? HBR thinks that it’s due to poor communication with people leaving their jobs. Most simply get a letter from their plan’s recordkeeper, and many take the simplest option of taking the money and running.

Picking one of the rollover options is often considered the best option for retirement savers – it keeps your money someplace you have easy access to and lets it keep growing, allowing your nest egg to expand. This puts you in the best position when you retire.

Bottom Line

According to Harvard Business Review, too many people are choosing to cash out their retirement savings when they leave a job. In fact, over 40% of people who left their job cashed out a portion of their savings between 2014 and 2016. They’d be better off picking a rollover option, which lets them keep their money in a retirement-focused account.

Retirement Planning Tips

A financial advisor can help you make the best choices when planning your retirement. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
If you use a 401(k), make sure you’re taking advantage of any employer match available to you. Your employer’s contributions are free money, which can ultimately help you reach your retirement goals.

Photo credit: ©iStock.com/FangXiaNuo, ©iStock.com/designer491

Their parents made China the world’s factory. Can the kids save the family business?

Reuters

Their parents made China the world’s factory. Can the kids save the family business?

David Kirton – Jun 18, 2023

RUICHANG, China (Reuters) – When Steven Du took over his parents’ factory producing temperature control systems in Shanghai, one of the first changes he made was to turn on the plant’s heating in winter – something his frugal forebears were reluctant to do.

“If you don’t improve their environment, the workers aren’t as happy and it’s harder for them to do their best work,” the 29-year-old said. “The change is worth the extra cost.”

Du, like tens of thousands of other young Chinese factory bosses, is inheriting a basic manufacturing business that can no longer rely on the labour-intensive model that made China the world’s largest exporter of goods.

A shrinking and ageing workforce and competition from Southeast Asia, India and elsewhere are making at least a third of China’s industrial base – the low-end manufacturers – obsolete, Chinese academics say.

This do-or-die mission of tech upgrades and practical changes largely falls on a group of people in their 20s and 30s known as “chang er dai”, or “the second factory generation”, a play on the derogative term for spoilt, rich children, “fu er dai”.

“If I’m chang er dai, I’m trying to save my family business from bankruptcy,” said Zhang Zhipeng, a research assistant at the Shenzhen Research Institute of High-Quality Development and New Structure, who estimates roughly 45,000 to 100,000 of this cohort are at various stages of taking over up to one-third of private Chinese manufacturing firms.

The large-scale generational transition, which comes as China’s growth prospects dim, is the first in the country’s private sector since the chang er dai’s parents emerged as industrialists in the decades after Mao Zedong’s death in 1976.

Reuters interviewed eight chang er dai for this report, who described their attempts to bring family businesses into the modern era with efficiency upgrades while facing challenges such as labour costs, shortages of workers and, in some cases, disagreements with relatives on the best way forward.

Du spoke on the condition that his business not be named to protect the privacy of his semi-retired parents, whom he said were in their 50s and largely leave factory affairs to him.

Like his peers, Du grew up with a level of comfort and opportunities his parents never dreamed of.

He went to high school and university in New Zealand, specialising in electrical engineering. He moved to the United States, working at Apple supplier Foxconn’s Wisconsin facilities. He studied Taiwanese and Japanese production methods, focused on reducing inefficiencies.

Those skills would come in handy in a factory the Chinese state set up in 1951 and privatised in 2002.

His father’s business acumen and his mother’s hard work helped turn the factory into a supplier to large Chinese appliance firms. It also sells components used in temperature-control systems for shopping malls, computer rooms, battery cooling, and medical equipment.

But production processes remained largely unchanged until Du took over in 2019. He introduced specialised industrial software that cuts across accounting, orders, procurements, deliveries, and other processes previously handled by humans, Du said.

He remodelled the factory floor to allow forklifts to drive around easily, grouping storage and production units differently to minimise physical effort for a workforce whose average age is around 50. A worker now walks 300 metres to complete the more complex tasks, down from one kilometre, and needs less than a third of the time to do it.

While his mother spent long hours micromanaging production, Du ends most days around 4 p.m. in a gym he set up inside the factory, and allows workers to use, before driving home.

“Young people like to be lazier, but laziness is actually a manifestation of progress,” he said.

Du raised wages by 10-20% in the past three years, to keep staff turnover under 5%, but says his factory is 50% more efficient.

“Factories need to transition to higher-end manufacturing or are doomed to fail, because their costs are rising,” said Zhang, the researcher.

A ‘MOTHER’S SON’

Zhang Zeqing estimates he achieved a similar efficiency boost by digitalising processes since he began co-managing with his parents their egg-products factory in Ruichang, a southeastern city.

At Ruichang City Yixiang Agricultural Products, workers in green uniforms place duck eggs into cups attached to a conveyor belt that feeds a vacuum-packing machine. A new screen above the machine displays the speed at which the eggs are sealed and estimates average output per worker, as well as the time and manpower needed to pack 10,000 eggs.

Barcodes track all products from farm to factory to store, allowing supervisors to monitor orders, production and delivery on their phones and make decisions based on real-time data.

“Before, we’d record all this by hand on paper,” said the 30-year-old. “All of the internal data was muddled. It led to a lot of wastage.”

Like five of the other chang er dai who spoke to Reuters, Zhang never planned to take over the factory. He wanted to study landscape design in France.

But he felt he had to step in, at least for a few years, and convince his now 55-year-old parents that tech upgrades, and setting up new distribution channels on e-commerce platforms, were worth investing in.

Something had to be done, he thought, as “the frontline employees are getting older and young people are less willing to work on the frontline”. China has record rates of jobless youth but many of them have university degrees and prefer not to work in factories, even if they take a job below their education level.

Zhang’s parents resisted at first, unwilling to spend money on a business they thought was doing fine. But they relented, eventually.

Sales have risen 35% annually since he came on board.

“I sometimes wonder why our e-commerce was successful when others failed. A manager at a company told me that because you are your mother’s son, she will support you infinitely, that is, even if you fail,” Zhang said.

‘TOO CHALLENGING’

To be sure, China as a whole is upgrading its industrial complex in more significant ways than the changes implemented by young factory managers like Du and Zhang.

Some segments, such as the heavily robotised electric vehicle industry, are disrupting global markets thanks to state subsidies, as well as foreign capital and know-how.

Chang er dai, however, help lift the bottom, which is also important for preserving China’s share of world manufacturing, two industry experts told Reuters.

Some of the technology Zhang introduced came from Black Lake Technologies, a company founded by Zhou Yuxiang, who counts more than 1,000 chang er dai among his clients.

“For the past decades, the model of many Chinese factories was based on revenue growth, so very few of them paid attention to production efficiency or digitalisation,” said the 34-year-old, who also sees himself as chang er dai, though he is not managing his parents’ business.

“They manage their operations typically through stacks of paper. More advanced factories might use Excel, but that’s it.”

Tian Weihua, an academic specialising in manufacturing upgrades at the Science and Technology Innovation Research Institute, a government think-tank, says the tech savvy and foreign experience of chang er dai give them a better chance than their parents to keep businesses competitive in a new environment of higher costs, weaker external demand and emerging manufacturing centres in cheaper, less developed countries.

But “technological upgrading doesn’t cure all ills”, said Tian, adding that further steps will be needed, including on product innovation.

Not all chang er dai will get there.

After studying textile design at the University of Arts in London, Zhang Ying, 29, took over her family’s garment factory in the eastern city of Ningbo in 2017.

But the business was struggling. Wages had more than doubled within a decade, to over 7,000 yuan a month. Workers, mostly migrants from inland provinces, were in short supply. She wouldn’t dare fire them.

Last year, she took time off to have a child and left other managers in charge. She has no intention to return.

“It was too challenging: the pressure was too sudden and great. I was getting hives from the stress and needed to be on medication for a year, so I quit,” she said.

(Reporting by David Kirton; Editing by Marius Zaharia and David Crawshaw)

Repub’s just can’t keep their hands off Social Security: Major Cuts to Social Security Are Back on the Table — What’s Being Proposed Now?

Go BankingRates

Major Cuts to Social Security Are Back on the Table — What’s Being Proposed Now?

Vance Cariaga – June 16, 2023

The 176-member House Republican Study Committee (RSC) approved a fiscal blueprint that would gradually increase the FRA to 69-years-old for seniors who turn 62 in 2033. The current full retirement age is 66 or 67, depending on your birth year. For all Americans born in 1960 or later, the FRA is 67.

While most Democrats want to boost Social Security through higher payroll taxes or reductions to benefits for wealthy Americans, the GOP has largely focused on paring down or privatizing the program.

Democrats were quick to push back against the proposal.

Solar-powered cars are challenging some of the most popular EV brands — and they can drive for weeks without charging

TCD

Solar-powered cars are challenging some of the most popular EV brands — and they can drive for weeks without charging

Abby Jackson – June 16, 2023

Auto manufacturers are racing to develop the latest and greatest cars. One trend we’re seeing is the rise of solar-powered cars, but how are these sun-powered machines different from other electric vehicles?

What are electric vehicles?

Electric vehicles (EVs) are battery-powered cars that use electric motors rather than an internal combustion engine for propulsion. When you charge an EV, the electricity gets stored in a large traction battery pack. This electricity gets used by an electric traction motor to drive the car’s wheels.

Gasoline vehicles have internal combustion engines that burn gasoline fuel to drive the wheels, releasing toxic fumes and harmful carbon pollution. These engines also produce noise pollution, or excessive noise and vibration.

Each year these gas-powered cars produce 3.3 billion tons of carbon pollution worldwide. Carbon air pollution traps heat from the sun within our atmosphere, causing the planet to overheat and extreme weather events like hurricanes to intensify.

It affects our health, too — fumes from car exhaust can cause or worsen asthma and other respiratory issues.

Since EVs only run on electricity, they don’t pollute the air. One study even found that having more EVs meant fewer emergency room visits for breathing problems. And compared to internal combustion engines, electric engines don’t produce nearly as much noise pollution.

A disadvantage of EVs is that we can’t always control where the electricity that charges these cars comes from — sometimes it means using dirty energy to drive a clean-energy car.

Why isn’t everyone adopting an EV?

EVs now make up 10% of all new car sales, but early adoption of new technology — like cars that don’t need to stop for gas — can be scary, though this technology isn’t very new anymore.

Today, there’s an abundance of EVs on the market at the lowest prices we’ve ever seen, and public charging infrastructure is expanding across the nation. This still isn’t enough for some drivers to trust the switch to electric cars.

One of the biggest hangups is range anxiety — defined as the fear an EV will run out of charge before reaching its destination and leaving its passengers stranded.

Though this is a bigger issue for long-distance travel rather than the majority of Americans that drive less than 30 miles a day, range anxiety is still enough to stop people from even considering the money-saving and electric alternatives to gas-powered cars.

Solar-powered cars, on the other hand, can practically erase these fears with the ability to get energy for free.

What are solar-powered cars?

Solar-powered cars (SPCs) are EVs completely or partially powered by direct solar energy. An array of photovoltaic cells converts sunlight into usable electric energy.

The panels on today’s SPCs can add between 15 and 45 additional miles in sunny conditions. When this free energy isn’t powering the car’s propulsion, it gets stored in the car’s battery.

SPCs have the same clean air and noise reduction benefits as other EVs but offer greater range independence.

California-based Aptera Motors and Dutch company Lightyear have led innovation by producing some of the first SPCs to hit the market. And there’s more to come. The 2024 Kia EV9 is partially powered by a solar panel built into the hood.

There have been a few setbacks for these solar car companies, and it will take some time before we start seeing SPCs in Super Bowl commercials.

“This is not like going from the flip phone technology to a smartphone, where they suddenly obsolete everything else,” AutoNation CEO Mike Jackson told CNBC. “This is a decadeslong journey from the internal combustion engine to electrification, but it’s here.”

In the meantime, there are a few solutions. One is to power charging stations with clean energy, like the English Shell station that converted to chargers equipped with solar panel awnings.

Another solution is to reduce EV charging anxiety — using electric vehicle apps to find charging points, ensuring your EV has a full charge before a long journey, and taking stops along your route as opportunities to charge.

To help other EV drivers, you can also call in any issues with a charging point to get them resolved.

Join our free newsletter for weekly updates on the coolest innovations improving our lives and saving our planet.

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HELOCs are back. Cash-strapped borrowers are tapping into a $33 trillion pile of home equity.

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Major Cuts to Social Security Are Back on the Table — What’s Being Proposed Now?

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Their parents made China the world’s factory. Can the kids save the family business?

Go BankingRates

Major Cuts to Social Security Are Back on the Table — What’s Being Proposed Now?

TCD

Solar-powered cars are challenging some of the most popular EV brands — and they can drive for weeks without charging

What are electric vehicles?

Why isn’t everyone adopting an EV?

What are solar-powered cars?