2024 has undoubtedly been a newsworthy year, and we’re only one quarter through! Between the shouts of wars and cries for cease fire, attacks on shipping vessels, thundering earthquakes, the crash and splash of a massive bridge collapsing, the excitement of a solar eclipse, not to mention all the political noise of an election year it can be hard to focus on what’s going on in our country. Through it all, a steady pulse can be felt, the heartbeat of America- Small Businesses. Much like our own human hearts, most people don’t think about the steady thrum of these individual businesses, yet they work on, keeping the body of our economy alive.

According to SBA Office of Advocacy, small businesses have accounted for over 40% of our GDP over the last few decades. They contribute significantly to our local economies, circulating revenue and supporting other local businesses, which is vital to keeping our economy healthy. Small businesses help to stabilize our economy. These enterprises provide employment opportunities within our communities and bring creativity, and more competition to the marketplace. New and innovative ideas often come from small businesses, helping to drive our economy forward. Small businesses help to knit our communities together.

The U.S. Chamber of Commerce reports that there were 12.9 million jobs created by small businesses between 1996 and 2021, an average of 516,000 a year. After the pandemic we saw a surge, 5.5 million jobs created from small businesses from 2020 to now, an average of 1,571,000 jobs a year.

Small businesses face plenty of challenges. They have limited access to capital compared to big corporations, increased pressure from other competitors, regulatory hurdles and red tape to deal with, not to mention the volatility of our current economic situation. Recession and inflation have been a huge obstacle for small businesses. Over 50% of small business owners say that inflation is their top challenge (U.S. Chamber of Commerce 2023).

Without small businesses pumping life into our economy the American people and our economy would experience a tremendous strain, on both a national and local scale. The consequences would reach far beyond the loss of millions of jobs. Small businesses contribute  substantially to our economy, without their contribution economic growth and innovation would slow. We would see reduced consumer spending and investing, which could lead to a recession. We would see supply chain disruptions and kinks in our supply chain which affect  other parts of our economy. We would lose the uniqueness and diversity we gain from having so many different businesses, which would result in a                  concentration of economic power in the hands of larger corporations, reducing competition. Without small businesses the government would lose a substantial amount in tax revenues, which would put pressure on government budgets, potentially leading to cuts in  public services and higher taxes on personal wages. 

It's crucial, more now than ever, to support small business and create a more stable and healthy economy. The importance of small businesses cannot be overstated. When we support small businesses, we ensure that steady life giving pulse will endure, giving life to our country for decades to come.

Photo 2 by: Tim Mossholder

We’re seeing a shift in the popularity of collar colors. For years parents and high school councilors have  encouraged young people to pursue traditional college educations and settle into a high paying white-collar job with a white picket fence to go with it. The prioritization of college degrees over trade careers has created an increasing shortage of skilled blue-collar workers in the US. There are over 9 million unfilled blue-collar jobs. So what do we do when the backbone of our economy starts to give out?

There is a demand for skilled trades people, which is outpacing the supply of people qualified to fill those roles. This shortage has increased the demand, which in turn has increased what businesses are willing to pay those workers. Between 2010 and 2012 the wage increase for blue color jobs went up only .6% compared to the increase of 4.5% for white collar jobs. However, between 2020 and 2022 those same blue color jobs increased pay by 14%, where the white-collar jobs only saw an increase of 7.5%. Wage gains for some blue-collar jobs have started to outpace gains for white collar jobs over the last three years. The combined shortage of trade workers and higher pay is driving up costs, creating a domino effect in our economy.

The starting pay for most white-collar jobs is still higher than entry level blue-collar jobs, but under the latest economic stress we’re seeing more and more layoffs in the white-collar world. Companies are turning to AI, replacing many employees as businesses try to cut back and ease the pinching pressure of our struggling economy. The result: many white-collar jobs are not as stable as they used to be.

Eight of the ten highest earning industries for small business ownership come from blue-collar industries including: construction, roofing, flooring, painting, heating & air conditioning, carpentry, plumbing, and electrical- all of which can earn more than $5,000 a month. This challenges the idea that you need to have a four-year degree in order to stand amongst the top earners of the country.

Blue-collar workers have always been the backbone of the United States and play a vital role in the American economy. In order to fuel a healthy economy, we need to find a balance between the blue-collar and the white-collar, this may require a shift in perspective as we help the young and upcoming workforce realize that blue-collar jobs are worth investing their time in. This country was built on the hard work of people willing to get their hands dirty and put in the extra effort.

Photo by: Jason Richard

Money supply refers to the volume of money held by the public at a particular time, this includes the currency in circulation (physical cash) and demand deposits (the assets on the books of financial institutions). The record of money supply is kept by the Central Bank of the country. 

Changes in the money supply have been seen as a key factor in driving the economy and business cycles. In the past, measuring the money supply has shown correlation between money supply and inflation as well as between money supply and price levels. However, over the last couple of decades, the relationship between money supply and inflation has become less predictable, making it less reliable as a guide for monetary policy. For this reason, monitoring money supply is used along side other economic measures, which allows for a broader, more accurate picture of the economy.

When the supply of money circulating increases, we typically see lower interest rates, which then generates more investment and puts more money back into circulation for consumers, which then leads to more spending. However, we can see the inverse of this when money supply falls or growth rate declines. When this happens, banks lend less, consumer demand declines, and people tend to hold on to their money rather than spending it, decreases again the amount of money in circulation. Further effects can be seen as businesses slow growth or lay off employees and home and car loans decline.

Turning 65 can mean a lot of things, but for most people it means signing up for Medicare. This can be a confusing thing to navigate. Let’s take a look at some Medicare basics and what your options are.

Medicare is a federal health insurance program. Those who are turning 65 can sign up between three months before their birth month and three months after their birth month, providing a 7-month window.

There are different parts of Medicare to cover specific services.

Medicare Part A (hospital insurance) covers inpatient hospital stays, care in a nursing facility, hospice, and some limited home health care. Normally, you don’t pay a monthly premium for Part A. There are some people who are not eligible for premium-free, but might be able to purchase Part A.

Part B (medical insurance) covers most doctor visits, outpatient care, medical equipment, diagnostic testing, ambulance service, and preventative services. Part B requires a premium amount, which for most people in 2024, is $174.70 per month and an annual deductible of $240. After the deductible is met, Medicare Part B covers 80% of your covered medical services, the remaining 20% you pay out of pocket.

Medicare Parts A & B are often called Original Medicare. Original Medicare pays most, but not all, of the costs of covered health care services. A Medicare Supplement Insurance, also known as Medigap, can help pay some of the remaining costs of your health care. This includes things like copayments, coinsurance, and deductibles, (the 20% from above). Some Medigap policies may also cover services or supplies Original Medicare doesn’t cover. Generally, you must have Medicare Parts A & B to buy a Medigap policy. One of the big advantages of a Medigap policy is you have the freedom to see any doctor that accepts Medicare.

Part C is known as Medicare Advantage and offers an optional, alternative way to receive your Original Medicare benefits. These plans are offered and managed by private health maintenance organizations (HMO’s). Instead of having Original Medicare, Parts A & B, you would have a managed plan like an HMO. To be eligible, you must already be enrolled in Parts A & B. These plans will cover the same services that traditional plans cover, but the independent HMO are allowed to set their own cost share requirements as well as their own co-pay and coinsurance amounts that you are responsible for paying. These costs are subject to increases as per the HMO. They also have different rules for how you can receive services. A downside to Medicare Advantage plans is they don’t always cover certain expenses when you get sick, resulting in unforeseen out-of-pocket costs, and what you end up paying for these plans can differ depending on your overall health. A significant limitation is Medicare Advantage plans use a network of doctors and hospitals, restricting your care to a list of approved doctors and facilities.

One challenge with the Medicare Advantage plans is that they can leave a market area and stop covering people in that area. Leaving these people to wake up one day with no additional coverage other than their original Medicare parts A & B. Medicare Supplement insurance companies can’t do that, providing you with reliable coverage. Once you are covered, the only way to lose the policy coverage is to stop paying the premiums. 

Part D helps pay for prescription drugs and recommended shots and vaccines. To get Medicare drug coverage, you must join a Medicare-approved plan that offers drug coverage. Each plan varies by cost and specific drugs covered, but they all must provide at least the standard coverage set by Medicare.

Deciding what coverage works best for you and your situation can take some research and consideration and will depend on your own personal factors. Do your homework and review each plan and its pricing.

Photo 1 by Marcelo Leal

Photo 2 byHush Naidoo Jade Photography

Photo 3 by freestocks

Your house is a very, very, very fine house, with two cats in the yard, life used to be so hard. Now everything is easy 'cause…you updated your property and casualty policy.

Property & Casualty insurance (P&C) is a term for policies that cover things like your house, cars, RVs, boats, motorcycles, etc. and the liabilities associated with them. These types of policies help safeguard against property damage as well as protect you from liability issues.

Most often, a person’s home is their biggest asset. Doesn’t it make sense to make sure it’s properly protected in case of a loss? Now is a great time to do some “spring cleaning” regarding your P&C policies. Because of the high inflation we have experienced, and the significant increase in home values, it’s important to make sure your coverage is up to date with the current value of your home.

Homeowners are typically required to maintain a policy that covers 80% of the replacement value of their home. If the coverage falls below the required amount the insurance company assumes the homeowner is self-insuring for the difference. This is called the coinsurance clause in the policy. This clause requires a policy holder to maintain the right level of coverage, so the insurance company receives a fair premium for the risk of possible claims.

Here's an example of how the increase in value of your home can result in inadequate coverage if your policy is not updated. If you bought a house for $300,000 and the insurance company is insuring it for 80% of the value (the required coverage, excluding the value of the land, which is not part of replacement value of the house), and you suffered a loss, the insurance company would pay up to $240,000 to rebuild the house. If your house increases in value from $300,000 to $500,000 the insurance company will pay per the coinsurance formula in the policy.

The typical coinsurance formula is:

(actual amount of insurance / required amount of  insurance) X amount of loss = amount of claim.

If your policy hasn’t been updated to the proper value this is how the insurance company would calculate the payment for the loss filed: ($240,000 / $400,000) X $100,000 = $60,000. Resulting in a $20,000 coinsurance cost to the homeowner to complete the needed repairs.

Some homeowner policies have an inflation clause that automatically increases the policy to the required level. This is one reason why homeowners policies tend to increase regularly, because the value of the home keeps going up. While we don’t anticipate having losses, they do happen, so we need to keep our policies up to date to make sure we don’t fall into a coinsurance scenario. 

Photo by Ian MacDonald

It’s usually pretty easy to love and care about the people in our lives, especially when it comes to family, but sometimes life calls on us to take that a step further and become caregivers.

People become caregivers for many different reasons. Often times, an elderly parent is in need of care from their children, sometimes a grandparent steps in to care for a grandchild. Other times, it could be the need of a sibling or other relative, or perhaps a friend stepping in to help another friend or neighbor. However, it comes about, becoming a caregiver can be both rewarding and burdensome. 

A caregiver is someone that provides care and tends to the needs of a person with short- or long-term limitations due to age, injury, disability, or illness. This could mean providing physical, social, medical, and emotional support. While it’s easy to list the black and white expectations of a caregiver, it goes much deeper than superficial actions. Being a caregiver means becoming an advocate, a cleaner, a medication dispenser, a cook, and requires flexibility. All those responsibilities can feel overwhelming. It can also create a huge financial  burden to both the person needing care and the caregiver. A study done in 2011 showed that women over 50 who leave the workforce to care for a loved one lose up to $324,000 in wages, Social Security   benefits, and private pensions over their lifetime      because of their caregiving responsibilities.

Being a caretaker is not all bad, though. It is, in fact, a wonderful opportunity to develop a sense of empathy and greater understanding of others. It allows you the chance to learn patience and problem-solving and enhance communication skills. You can develop many abilities that could be useful in other areas of your life.

So where is the balance between the overwhelm and the reward? A lot of it comes down to how well the person needing aid has prepared financially. When people include a Long-Term Care (LTC) policy in their retirement and financial plan it ensures that if the time comes, there is money set aside for their needs, easing the burden a lack of money could place on them and their caretaker. Having LTC insurance in place changes the role of the caregiver to a care manager, allowing them to pay for professional help when needed, relieving the burden of being a sole caregiver. The role change can also relieve other personal burdens felt as a caregiver, reducing the pressure it places on their family and work life. However, one of the greatest blessings comes from the piece of mind it can provide.

Being a caregiver can be a rewarding and fulfilling role. It provides an opportunity to give back and help someone else. It’s important to plan financially and avoid the negative pitfalls of being financially unprepared. Having a LTC policy could be an option as you plan for your future retirement needs, for both you and your loved ones that would be taking care of you, providing peace of mind for everyone involved.

Photo by Lina Trochez

We can’t escape paying taxes. It’s a part of life; it’s unavoidable. Even folks that try to evade paying their taxes end up paying. Afterall, failing to pay his income taxes was the tipping point in being able to convict famous mob boss, Al Capone. One way or another, Uncle Sam gets his payday. So, what does this mean for your retirement accounts?

Most people begin making withdrawals from their retirement accounts before the required 74-year threshold. If you put off your withdrawals until later, it could bump you into a higher tax bracket. It’s important to have a retirement plan involving tax strategy.

Photo by Josh Appel