Over the years, we’ve seen low-interest rates and we’ve even seen ‘ultra-low’ interest rates. However, now we see negative interest rates but what does that mean? And how does it affect the economy? Is it a good thing or a bad thing? Real vs Nominal Interest Rate Before we head any further, we should point out that real interest rates are adjusted for inflation whereas nominal rates are not. Is the Real Rate Important? As the real rate adjusts for inflation, this can turn a nominal yield from positive to negative. Let’s say that the bank sets a 1% nominal rate with inflation at 2%; the real rate would be -1%. When you put $1,000 into a bank, it will grow by $10 after one year, but it would be worth less than $1,000 when it comes to buying power. Therefore, purchasing power is lost when a negative rate is seen. […]
Over the past few months, the election and the stock market are topics of discussion on everyone’s lips. Now we are less than a month away from the big day. Despite much debate regarding how the outcome will affect different areas, we have yet seen how it will affect the stock market. With the United States as a key driver of the global economy, the result is likely to yield a reaction. No matter which of the paths we take, we can be sure after the election things will look very different. Overall, we should see a huge impact on health care, taxes, federal regulations, immigration policies, and more in the coming years. However, before we make predictions regarding this election and the stock market; let’s see what effect previous elections had on the stock market and global economy. Which combination is best? According to history, the stock market performed […]
Small Business Healthcare Tax Credit The Small Business Healthcare Tax Credit helps small businesses and tax-exempt organizations afford the health care they provide their employees. Your business is eligible for the credit if: Your business employees fewer than 25 employees. That includes those working full-time and part-time. If the average annual wage paid to employees must be less than $50,000 (in 2015), and the employer must pay at least 50% of all employees’ health insurance premium costs. Beginning in the tax year 2014, the tax credit became worth a maximum of 50% of premiums paid by small business employers and 35% of premiums paid by small tax-exempt employers. If you didn’t owe any taxes during the tax year, the credit could be carried back or forward to other tax years. To learn more about small business tax issues, please contact a qualified tax professional. Tip courtesy of IRS.gov
Counting the Cost of Hurricanes Whenever disaster strikes, people often wonder: What’s all this going to cost? Though the human toll of injury and death may be incalculable, experts have gotten pretty good at estimating the economic costs of lost production and physical damage due to major storms. According to one economist, about two-thirds of the financial losses of a hurricane are related to property damage while one-third come from economic losses. The insurance costs of property damage due to Matthew’s wind and storm surge are currently estimated to be between $4 billion and $6 billion, though those figures may rise as claims start rolling in. The chart below shows storm damage estimates for four major hurricanes since 1979. We can see that Hurricane Sandy and Hurricane Katrina dwarf Matthew regarding overall damage. However, Matthew is estimated to have a higher percentage of losses due to wind damage, which could […]
If you’re nearing retirement age, you may have questions about Required Minimum Distributions or RMDs. The rules surrounding RMDs are sometimes vague and unclear. However, you can face severe penalties for failing to withdrawal the right amount. That’s why it’s important to understand what’s required. Not only can you keep yourself out of trouble, but you can use your RMD to continue reaching your financial goals.
Everyone ever interested in working from home asks themselves how to start a home-based business? As the internet grows every day, there are now more opportunities to work from home than ever before. In truth, multiple industries now offer the ability for workers to work from home and even starting a brand new business is now easier than ever before. Despite this, there are still some traps that some people fall into and it can cost the future of any potential business. For this reason, we have created a comprehensive guide on how to start a home-based business. Whether you want tips for the planning stage or the actual execution, we will have it all for you here. Ultimately, there are three main steps to starting a home-based business. First, you have to decide what you’re going to do. Second, you have to complete a whole host of different planning […]