WASHINGTON -- The number of Americans filing new claims for unemployment benefits unexpectedly fell last week, indicating the jobs market was on solid footing even as the economy struggles to regain momentum after abruptly slowing in the first quarter.
Other data Thursday showed that a strong dollar and lower oil prices suppressed producer inflation in April. That together with signs of modest growth early in the second quarter suggest the Federal Reserve probably won't raise interest rates until later in the year.
Initial claims for state unemployment benefits slipped 1,000 to a seasonally adjusted 264,000 for the week ended May 9, the Labor Department said Thursday, within a whisker of a 15-year low reached two weeks ago.
They have been below 300,000, a threshold associated with a strengthening labor market, for 10 straight weeks. Economists polled by Reuters had forecast claims rising to 275,000.
The four-week moving average of claims, considered a better measure of labor market trends as it irons out week-to-week volatility, fell 7,750 to 271,750 last week. That was the lowest level since April 2000.
U.S. stock index futures added to gains after the data, while prices of U.S. Treasuries edged up. The U.S. dollar extended losses against a basket of currencies.
The claims data underscored the dilemma the U.S. central bank faces. Policymakers believe the economy is poised to strengthen and the labor market appears to be tightening, but surprisingly soft growth and subdued inflation pressures are complicating their plans to lift rates.
The Fed, which has a 2 percent inflation target, has kept its key short-term interest rate near zero since December 2008.
Producer Prices Resume Downward Trend
In a separate report, the Labor Department said its producer price index for final demand fell 0.4 percent last month, declining for the third time this year. The PPI increased 0.2 percent in March.
In the 12 months through April, producer prices fell 1.3 percent, the biggest year-on-year decline since 2010, after declining 0.8 percent in March.
Economists had forecast the PPI rising 0.2 percent last month and falling 0.8 percent from a year ago.
The economy barely grew in the first quarter, held back by a range of factors, including the dollar, bad weather and port disruptions. Retail sales and manufacturing data suggest that while activity is picking up, the pace remains modest.
A drop of 0.7 percent in the index for final demand goods accounted for more than 70 percent of the decline in the PPI last month. Energy prices fell 2.9 percent after rising 1.5 percent in March. Food prices fell for a fifth straight month.
The dollar, which has gained about 11 percent against the currencies of the United States' main trading partners since June, and lower energy prices are keeping inflation subdued.
Last month, the volatile trade services component, which mostly reflects profit margins at retailers and wholesalers, fell 0.8 percent after slipping 0.2 percent in the prior month.
A key measure of underlying producer price pressures that excludes food, energy and trade services ticked up 0.1 percent after rising 0.2 percent in March.
Beth Hall/APMichelle Duggar is surrounded by her children and husband Jim Bob after the birth of her 17th child in Rogers, Ark., in 2007.
Americans are fascinated by large families like the Duggars, of the TLC/Discovery reality show "19 Kids and Counting," so why don't more of us have big broods?
Sixty-five percent of Americans cite cost as the major deterrent to having larger families, according to a survey by the Pew Research Center. The cost to raise a child to age 18 now stands at $246,340, according the U.S. Department of Agriculture.
How do average large families without reality show salaries afford it? And without massive debt? Some real families talk on the record about whether there really is "economy of size" without a reputed $3.5 million Jim Bob Duggar net worth.
Food Is the Big Challenge
The Roberts family -- Ty, Amy and eight kids aged 4 months to 17 years -- live in an outlying Tulsa, Oklahoma, suburb and make do on husband Ty's $90,000 annual salary as a non-profit executive and some additional income from her large-family living blog.
Their food budget is $1,000 a month. Although Ty hunts a little and Amy buys a side of beef once or twice a year, she says keeping the food bill down is the biggest struggle with growing kids expecting three squares a day plus snacks. Back of the envelope figuring makes that 21 meals times 10 people a week, or 210 servings, give or take. She doesn't cut coupons or go to membership stores like Costco, finding those not worth the time or fees.
In rural Duncannon, Pennsylvania, the Robinsons, Gerald, Mary and their 11 children from age 15 months to 15 years live on husband Gerald's $95,000 sometimes variable sales income. Mary also finds food ("the largest part of our monthly budget") a challenge at $700. She relies on a buying club she and 14 other parents have organized to buy directly from a local food distributor. For a minimum $1,000 order for the group, their order delivered to a central pick up spot.
The Raineys, Elaine, Scott and nine children, ages 13 to 25 years, are struggling less with two of their kids now on their own and two in college. But Elaine also saves considerably on their $800 monthly food budget thanks to the privilege of shopping at the military commissary. Husband Scott is a retired army lieutenant colonel but still works bringing in -- along with his army pension -- just above six figures. Like the Robinsons and the Roberts, the Raineys rarely eat out at restaurants.
Hand Me Downs, of Course
All three families shop garage sales and thrift shops for clothes, although Amy Roberts does have to buy business attire at department store sales for her husband. All three families buy some shoes and underwear at big box stores like Walmart or discount stores like Famous Footwear. Roberts also highly recommends thredUp as an alternative for large families.
For years, the Raineys benefited from the kindness of the military base communities with other moms donating their kids' clothes and Elaine paying it back as her own children got older.
Mary Robinson also sews and one of her favorite money saving tips is to make winter hats and mittens out of fleece jackets she finds at garage sales. She also scours thrift shops with months in advance shopping lists for out of season boots, shoes and other clothes for the family, significantly marked down.
Health and Housing
One benefit of most health insurance plans is that insuring mom, dad and one child costs the same as insuring parents with plenty more kids. The Roberts family, in fact, doesn't use Ty's employer health benefits, instead finding a Christian-based health insurance plan was "about half the cost of the company sponsored plan" and which she adds, hasn't raised its rates in eight years and is in compliance with the Affordable Care Act, also known familiarly as "Obamacare."
The Raineys qualify for military heath insurance but regularly have to budget for the unexpected, as do the Robinsons. The Robinsons qualify for what Mary calls a basic no-frills plan through her husband's employer and admits the deductions and co-pays made it tight when they had their last child.
Housing, generally the largest part of the American family budget, looms less large for the Robinsons whose mortgage on their 5,000-square-foot "farmette" now roughly equals the food budget.
The Raineys bought their house outright during the housing crash at a six figure discount and because it was a fixer-upper. They did all the renovations themselves and enjoy a 5,600 square foot home.
While the Roberts' have always rented, (now $1,400 a month for a 2,200-square-foot home) they always try to find a lower cost of living area. Without a mortgage, the Roberts also have no debt.
Entertainment, What's That?
Rarely do any of these families go to movies or restaurants, take vacations or send the kids to camp. Instead all three prefer to spend that money on inexpensive family friendly inexpensive activities like camping and hiking or extracurriculars for the kids.
The Robinsons always believed in teaching the oldest kids how to play piano or ride horses who then the teach their younger siblings. Robinson also suggested it never hurts to ask if there is a sibling discount for classes.
Elaine Rainey admitted a big splurge for her family has been musical instruments but two children now play semi-professionally. Amy Roberts, too, believes this investment in her kids' unique interests is worthwhile and pays for music lessons and photography equipment.
By the way, none of the families pays for regular chores or give allowances.
College and Beyond
That USDA figure doesn't include the cost of college. All three families home-school and Rainey with two on their own and two in college is relieved those four earned scholarships. The three mothers say their children already expect to pay for college themselves or earn scholarships. The Roberts' have saved some money for college to which they add a little every year.
While all three families have little to no debt and manage to save a little for a rainy day expenses like car repairs or medical bills they do agree things are getting more challenging, especially food. But expecting the unexpected, paring extraneous frills and planning as a family are part and parcel of making the "economy of size" work.
NEW YORK -- Carl's Jr. and Hardee's are cramming a summer cookout into one burger.
The upcoming menu item is made with a beef patty that is topped with a split hot dog. The meaty duo sits on a layer of Lay's potato chips between hamburger buns. Ketchup, mustard, tomato, red onion, pickles and American cheese will be thrown in, too. The burger will have 1,030 calories and 64 grams of fat.
"The hot dog is like a smoked meat product, so it's not unlike bacon," said Brad Haley, chief marketing officer of CKE Restaurants, the owner of Carl's Jr. and Hardee's.
CKE Restaurants via AP
Fast food chains have been trying to outdo each other with outrageous menu items to stand out. Wendy's, for example, offered a cheeseburger topped with pulled pork last year.
Carl's Jr. and Hardee's are calling their new burger the Most American Thickburger. It goes on sale at both locations on May 20.
"We've had this idea, believe it or not, for a long time," Haley said.
The Most American Thickburger will use kettle-cooked Lay's chips, which are thicker than regular chips, to prevent them from getting soggy.
The burger will cost $5.79 alone or $8.29 for a combo, which comes with fries and a drink.
CKE Restaurants has experimented with meat-on-meat burgers before. It previously sold a burger topped with pastrami at Carl's Jr., and sold a burger smothered with thinly sliced steak, called the Philly Cheesesteak Thickburger, at Hardee's.
CKE Restaurants has experimented with meat-on-meat burgers before. It previously sold a burger topped with pastrami at Carl's Jr., and sold a burger smothered with thinly sliced steak, called the Philly Cheesesteak Thickburger, at Hardee's.
Alamy
Coal is dying as a source of energy in the U.S. as increased regulation and competing energy sources push it out of the market. The headlines might make you think that coal's decline will lead to higher energy bills or less energy security, but that's simply not the case.
As coal plants and coal mines are shut down around the country, the cost of electricity hasn't been as impacted as you might think. In fact, energy costs are now growing more slowly than they were when coal was the leading source of energy in the U.S. To understand why, you have to look at how quickly competing sources of energy are lowering their own costs.
The Decline of Coal
There's a lot of debate about what's actually driving the decline of coal in the electricity industry, but there's no denying that coal's best days are in the past. Over 150 coal power plants have been closed this century, and the trend shows no sign of slowing.
According to the U.S. Energy Information Administration, the use of coal in electricity generation is down more than 20 percent just since the beginning of 2008.
Source: U.S. Energy Information Administration
While coal generation has declined, you might think that energy costs would have spiked as a result. But the impact of plant closures has actually been to slow electricity cost growth.
The Surprising Impact on Electricity Prices
Electricity costs go up nearly every year because utilities need to make investments in maintaining the grid to serve customers, and those costs rise with inflation. So, it's no surprise that electricity rates have gone up over the past decade on a regular basis.
What is surprising is that the rate at which electricity prices have increased has actually slowed at the same time as coal plants are being shut down. Between 2001 and 2008, when coal usage was still growing, the price of electricity increased 4.2 percent a year in the U.S. In the six years since, electricity prices have increased just 1.2 percent a year.
Source: U.S. Energy Information Administration
That's partly due to the falling cost of natural gas and partly because wind and solar energy are now lower-cost than coal or natural gas. Investment bank Lazard issues ban annual report called Lazard's Levelized Cost of Energy Analysis that analyzes the cost to build new power plants, and coal at 6.6-15.1 cents per kWh is now more expensive than wind at 1.4-6.7 cents per kWh and even utility solar at 5.6-8.6 cents per kWh.
Regulations that make pollution from coal more expensive might be putting coal at a disadvantage, but alternatives to coal are winning on more than the pollution front. According to Lazard, wind and solar are actually lower-cost than coal was in 2009 (5.7 to 14.4 cents per kWh), before many current EPA regulations were put in place. So, cost is driving the drop in coal and growth in wind and solar energy.
Why Electricity Prices Could Actually Fall in the Future
The trends above don't show any signs of slowing, either, which could lead to falling electricity costs in the future, something we've never seen on a regular basis. That's because these new sources of generation on the electric grid are actually lowering costs year after year.
Between 2009 and 2014, wind and solar cut their own levelized costs of energy 52 and 55 percent, respectively, according to Lazard's analysis, and in 2014, 55 percent of new power generation in the U.S. was wind or solar. If the cost trend continues, even at a slower rate, electricity prices could begin to fall as more renewable generation is built.
The Crazy World of Energy in 2015
It may seem counterintuitive, but more renewable energy and natural gas combined with less coal is actually having the effect of slowing the growth in electricity prices, not the other way around. It's actually great for consumers.
Coal has played a big role in energy in the U.S. for over a century, but those days are coming to an end -- and it's becoming clear that the death of coal will actually have a positive impact on your energy costs. Maybe the new generation of cleaner energy plants makes both environmental and financial sense after all?
Travis Hoium is a Motley Fool contributor. Try any of our Foolish newsletter services free for 30 days. Is your portfolio ready for all that this year has to offer? Click here to check out our free report for one great stock to buy for 2015 and beyond.
ShutterstockBudget challenge: Try saving $50 a week for your summer activities.By Sabah Karimi
If you want to enjoy a carefree summer, make sure you have your finances in order so that money stressors don't rule your days. Whether you want to jet away on a summer vacation or just plan on enjoying a few weeks of rest and relaxation at home, prepare for a fun summer ahead by taking steps to improve your financial situation right now.
Here are six smart budget moves to make before summer begins.
1. Create a summer travel budget. If you're planning on doing any traveling this summer, put together a realistic budget to cover the cost of those road trips, weekend getaways or flight and hotel packages to your destination of choice. Start researching deals and determine what type of budget range you are comfortable with for each visit. Consider being flexible with your travel dates so you can secure a great mid-week deal or last-minute package to offset some of the costs.
2. Cut out extra expenses. Trimming down expenses even by $50 a week can save you $200 a month leading up to those long summer days. Take a close look at your grocery budget and everyday expenses such as coffee trips, parking fees and other miscellaneous costs that add to your weekly expenses. Cut back on extra trips, or plan on carpooling to save money on gas. Cook more of your meals at home to save on food costs. Making a conscious effort to save a little here and there can help you build up that savings account sooner than you think. Use a budgeting app for a few weeks to get into the habit of tracking your daily expenditures while you're on the go.
3. Organize your accounts. If you have more than one bank account or different types of accounts that may or may not be collecting interest, consider consolidating your accounts to make it easier to manage your money. Some online banks allow you to create sub-savings accounts for specific purchases and expenditures; this can help you build up that summer travel fund or just allocate a certain amount of money for recreational purposes for the season. Take inventory of your accounts to determine whether you are paying unnecessary fees or accumulating charges because you aren't maintaining a certain balance. Those extra costs can add up, so it may be time to shift things around and just maintain a single account.
4. Prepare a list of budget-friendly activities. Now is a great time to brainstorm some fun ideas and activities for summer. Being spontaneous is always fun, but it can also be a costly venture when you consider that many hotels and resorts book up quickly for the summer and command higher rates during peak season. Plan ahead by making a list of budget-friendly destinations, free activities in the area and low-cost events that you might be interested in attending this summer. Creating this list now can help you pick up a fun activity even at the last minute -- without worrying too much about cost. Turn to your chamber of commerce, local parks and recreation department, area museums and local travel blogs for some interesting ideas in the months ahead.
5. Boost your income. If you're having a hard time saving money, seek out some simple ways to give your income a boost. You could pick up a part-time job for a few months, sell some items online or talk to your current employer about getting a raise. Be realistic about how much you can earn over the next few months or how much you could cash in on by selling certain items. Make sure the money you save from these sources goes directly into a savings account specifically for summer funds.
6. Start operating on a cash-only basis. If saving money doesn't come naturally to you and you don't think you can reach your summer savings goal, start operating on a cash-only basis to get a better handle on spending. Withdraw a certain amount for personal expenses each week, and pay your bills directly from a checking or savings account. Getting into the habit of working only with the cash you have on hand can put you back in control of your finances and make it that much easier to set savings goals.
Sabah Karimi is a columnist for the blog Wise Bread, where you can find consumer tips like how to select the best balance transfer credit cards.
Store-bought greeting cards can get pretty costly, with prices going up to as much as $10 a card. However, there are ways to send personalized greeting cards on a budget. You just have to know where to look.
Using mobile apps, you can create and send beautiful greeting cards in minutes from the comfort of your home. For example, RedStamp lets you browse through hundreds of customizable templates and color schemes. The company will even put your card in the mail for you for as little as $2.99.
Another great app to check out is Postagram. Postagram connects to your phone's photo library so you can send custom postcards that are personalized with the photo of your choice. The best part is that the photo pops off of the card, so your special someone will get a greeting card and a personalized photo gift.
Remember, when it comes to greeting cards, sending shouldn't mean over-spending.
NEW YORK -- Coupons are everywhere. Everyone loves a good deal, and it's easy to start looking around the Web or a newspaper or circular and see visions of giant savings dance in front of your eyes. It's like free money, right?
Well, not exactly. Yes, there are tons of ways to save. No, it's not so easy to wade through all the options or pick a plan and stick to it.
First, you've got to realize why coupons were created: to get you to spend.
We've always said that coupons often encourage people to spend more than they have to and buy more than they want to.
"We've always said that coupons often encourage people to spend more than they have to and buy more than they want to," says Tod Marks, a senior project editor for Consumer Reports. In recent years, a big coupon trend has been offering savings that only kick in if you buy, say, two or three cans of soup instead of just one.
Coupons steer your shopping behavior in other ways. Companies use coupons to get you to shop at a particular store, buy a particular item, try a new product, or encourage you to spend more than you otherwise would.
But there's another reason. Companies use coupons to offer discounts to bargain-hunting shoppers while maintaining a higher price for customers less motivated by savings. Imagine a supermarket that sells a can of soup for $2. Some shoppers will buy the soup, but others will decide it's too expensive. The store could cut the price to $1 a can to get all of the customers to buy it, but that would slash its profits.
A coupon can give the store the best of both worlds. Dedicated deal-hunters will buy and save money, while everyone else accepts the higher price. And if you're excited about a good deal, you're more likely to buy without thinking.
"People do actually spend more when they think they're getting a good deal," says consumer psychology expert Dr. Kit Yarrow. "There's more focus on ingenuity and shopping prowess than on the item."
Yarrow, a professor emerita at Golden Gate University, says shoppers today expect discounts and don't trust retailers. But coupons let them feel they're making smart choices and leveling the playing field. That feeling is so powerful, they're actually willing to spend more money to get it.
"Retailers know that consumers are a little bit bargain-crazy right now and they're extra susceptible to people who feel like they're smart shoppers and they're getting one over on the system," she says.
The Web is full of coupon strategies and offers, but a few ideas stay pretty constant:
You need to carefully and honestly evaluate your eating habits. If you clip coupons and use them to buy a lot of food you won't eat, you're wasting money.
Do your research. Coupons on many foods come and go in cycles, so you may want to learn the patterns at your local supermarket.
Read the fine print on coupons and be conscious of expiration dates.
All that planning can be a challenge. It's real work. But with some care and focus on a few items, Marks says, you can certainly save money.
If coupons aren't for you, he recommends shopping at warehouse clubs like Costco, which have annual membership fees and regular low prices instead of constant sales. He also suggests buying store brands, which can be much cheaper than better-known national brands.
"There's no reason to pay full price on name brand staples that you buy week in and week out. If you pay attention to the store's flyer, the trends and the sales cycles become eminently clearer," he says.
NEW YORK -- Saudi Arabia and other oil-exporting nations are about to make your summer vacation a lot more fun by keeping gas prices at their lowest May-to-September levels in at least six years.
"The savings are going to be a big boon," says Patrick DeHaan of market tracker GasBuddy.com, which predicts U.S. pump prices will average around $2.40 to $2.65 a gallon from Memorial Day to Labor Day.
That will be lowest summertime level since at least 2009, when gas averaged $2.57 a gallon. And if prices remain near the bottom of GasBuddy's forecast, Americans will pay the smallest summer fuel charges since 2005, when gasoline averaged $2.33 a gallon during the May-to-September period.
Low summer pump prices are good news for the economy, as Americans do the most driving during warm-weather months.
DeHaan says a roughly $1-a-gallon drop in prices since last summer will put about $400 million extra in Americans' pockets every day in coming months.
AAA estimates lower fuel prices have already saved consumers $50 billion this year -- or $400 per household -- with the good times to only continue during the summer-driving season. The auto club's own summer forecast closely mirrors GasBuddy's, with AAA predicting pump prices will average around $2.50 to $2.75 a gallon nationwide during the next few months.
"It's clear that many Americans are using their gas savings to travel this year," Green says.
DeHaan says pump prices are way down due to a combination of higher U.S. shale-oil output and moves by Saudi Arabia and other Organization of Petroleum Exporting Countries countries to undersell their American rivals.
"The Saudis woke up one morning in early October and started to say that they were essentially looking to win market share back from the United States by offering discounts on oil," the expert says.
Although Saudi Arabia has somewhat backed off of that position, The Wall Street Journal reported this week that OPEC expects oil to rise no higher than around $76 a barrel over the next 10 years from roughly $61 today. That would keep consumers' fuel costs at around $3.31 a gallon or less if the current relationship between wholesale-oil prices and retail-gas charges holds.
Average gas costs have been generally falling for almost a year since hitting the current cycle's peak of $3.68 a gallon last June. Prices bottomed out at $2.03 a gallon on Jan. 26, but have partly rebounded since then to average $2.66 as of earlier this week.
Still, fuel costs are well below both their June 2014 highs and the all-time record of $4.10 a gallon that they reached in July 2008.
DeHaan says the modest prices should particularly help lower-paid Americans afford auto-oriented vacations this summer.
"Well-to-do travelers go where they want to go regardless of fuel prices, but the real different will be with paycheck-to-paycheck workers," he says. "With average earnings up and gas prices at their lowest levels since at least 2009, even the folks that aren't making the most income will be able to take some time off and hit the road."
NEW YORK -- U.S. stocks ended sharply stronger Thursday and the S&P 500 closed at a record high as investors worried less about interest rates and a weaker dollar offered the possibility of stronger sales for U.S. multinationals.
The Standard & Poor's 500 index (^GSPC) gained 22.62 points, or 1.1 percent, to end at 2,121.1, exceeding its previous all-time high close of 2,117.69 on April 24. The Nasdaq composite had its strongest day since January.
After oscillating in what many investors view as a range for much of the past three months, the S&P's gain in 2015 now stands at 3 percent.
The dollar moved to its lowest since January against a basket of currencies of major U.S. trading partners -- good news for companies that have large foreign sales.
A report showing a drop in initial claims for state unemployment benefits last week did little to change broad expectations that the U.S. Federal Reserve wouldn't increase interest rates before the second half of 2015 at the earliest.
"There's a 50-50 chance they're not going to raise rates this year, so why are we spending two years discussing this? Let's focus on the fact that the economy is doing okay," said Steve Goldman, principal of Goldman Management in Short Hills, New Jersey. "The path of least resistance is higher."
Wall Street's top banks expect the Federal Reserve to begin raising interest rates in September, according to a Reuters poll last week.
The Dow Jones industrial average (^DJI) rose 191.75 points, or 1.1 percent, to end at 18,252.24. The Nasdaq composite (^IXIC) added 69.10 points, or 1.4 percent, to 5,050.80.
Movers and Shakers
All of the 10 major S&P 500 sectors were higher, with the tech index's 1.73 percent rise leading the way. Apple (AAPL) shares rose 2.33 percent, making the stock the biggest driver on both the Nasdaq and S&P 500.
Apple's quarterly dividend, which many shareholders reinvest, was payable Thursday.
Avon Products (AVP) briefly jumped as much as 27.4 percent after a regulatory filing from a firm said it had offered to buy the cosmetics company for nearly three times its market value. Avon said it hadn't received an offer.
Shake Shack (SHAK) fell 4.18 percent to $65.50 after the hamburger chain reported a surprise adjusted quarterly profit. The stock debuted in January at a listing price of $21.
The S&P 500 posted 31 new 52-week highs and 5 new lows; the Nasdaq composite recorded 101 new highs and 29 new lows.
Advancing issues outnumbered declining ones on the NYSE by 2,339 to 744, for a 3.14-to-1 ratio; on the Nasdaq, 1,909 issues rose and 861 fell, for a 2.22-to-1 ratio favoring advancers.
"When you get those kinds of advance-decline numbers, that means there's a lot of buying. That's what impresses me on days like today," said Frank Gretz, a technical analyst at Wellington Shields & Co., a brokerage in New York. "A day like today clears the air to the upside."
About 6 billion shares changed hands on U.S. exchanges, below the 6.3 billion average for the last five sessions, according to BATS Global Markets.
-With additional reporting by Tanya Agrawal.
What to watch Friday:
The Federal Reserve Bank of New York releases its survey of manufacturing conditions in New York state for May at 8:30 a.m. Eastern time
The Federal Reserve releases industrial production for April at 9:15 a.m. Eastern time.
The University of Michigan releases findings from its preliminary survey of consumer sentiment for May at 10 a.m.
The Treasury Department releases international money flows data for March at 4 p.m.
Jack Dempsey/APCredit cards can give you behind the scenes access, say, for Denver Broncos' training camp.By Christine DiGangi
Freebies are among the many benefits of having a credit card. Some typical perks include car rental insurance, extended warranties on purchases and free credit scores, but many issuers have a collection of more luxurious offers, available to only some of their cardholders.
Rewards and what we're calling "perks" differ -- rewards are generally redeemable through points or miles you accumulate by spending money on the credit card. A so-called perk is an exclusive item or discount only available to card-members.
Even if you don't have an account branded as a "rewards card," you may have access to some special deals your issuer arranges for its customers. Be careful to read the terms and conditions, and know that it's usually not worth financing purchases just to get the associated rewards, because interest rates on such cards tend to be quite high. If you're carrying a balance, you can see how long it will take you to pay it off using this calculator.
When choosing a credit card, focus on what's most important to you, and make sure you only apply for cards you think you're qualified for. Check your credit before applying for a credit card, to see if your score meets the credit issuer's credit score threshold for the approval process. You can see two of your credit scores for free on Credit.com to see where you stand.
1. Free Monograms
The L.L. Bean Visa credit card allows cardholders to have their merchandise monogrammed for free. It's not a huge money saver, but it's unusual.
2. NFL Sideline Access
The NFL Extra Points card from Barclaycard gives fans a slew of offers, like visiting a team's training facility or access to the post-game press conference. "I was on the sidelines of the Denver Broncos game during the warmup, and when the warmup was over I went to the tunnel where all the players come out," said Jason Steele, an expert on credit card rewards and a frequent contributor on the topic to Credit.com. "It differs by team. These are generally things you couldn't get -- it's not something they just offer to everyone."
3. Pow-Wows With Celebrities
Citi Private Pass is a program for Citi cardholders that gets them into some ticketed events for free. The most recent free event is a talk with actress Claire Danes, tickets for which cost $40 but are complimentary for Citi cardholders. PrivatePass also allows cardholders to purchase various event tickets before they go on sale to the general public, including concerts, sports camps, restaurants and more.
4. United Virtual Airlines Flight Simulator
Some credit card issuers auction rewards to their cardholders -- instead of bidding money, cardholders bid miles or points for the prizes. In an auction through United Airlines and Chase for their Explorer cardholders, Steele got the opportunity to go to the United Airlines flight simulator center. "This is where airline pilots travel from all over the world to train," Steele said. He got to use the simulator and other equipment in the facility. "I got to jump down the emergency exit slides -- it was pretty fun."
5. BMW One-Day M School
One of the items on the InterContinental Hotels Group auction site -- associated with the IHG Rewards Club Select Credit Card -- is a class for two people at the BMW Performance Center in Thermal, California. The winner gets to exercise his or her driving skills in M model BMWs, just like professional drivers.
At publishing time, the NFL Extra Points card from Barclaycard, IHG Rewards Club Select Credit Card and United MileagePlus Explorer Card are offered through Credit.com product pages, and Credit.com is compensated if our users apply for and ultimately sign up for any of these cards. However, this relationship does not result in any preferential editorial treatment. It's important to remember that interest rates, fees and terms for credit cards, loans and other financial products frequently change. As a result, rates, fees and terms for credit cards, loans and other financial products cited in these articles may have changed since the date of publication. Please be sure to verify current rates, fees and terms with credit card issuers, banks or other financial institutions directly.
Alamy
You aren't particularly fond of your job -- and you have this great business idea -- but something always keeps you from acting on it.
If you're like most people who aspire to one day have their own business, you've probably been putting this move off for years.
But why?
There are at least 15 obstacles keeping you from starting your own business. But try to take it in stride -- they're common reasons which keep a lot of people from getting started on their business idea. Some of them are tangible problems, but most are primarily driven by emotion.
The good news is you can fix all of them.
1. Fear of The Unknown
Fear is just a part of the human condition. It's an emotion which rears its ugly head anytime you're about to take a plunge into the unknown. And if you're going to start your own business there will be plenty of unknowns, which means plenty to fear.
At the top of the list is fear of failure -- what if you start a business and it doesn't make it? What if you can't get your old job back? What if the business failure lands you in bankruptcy court? What if you lose your home because the business doesn't make enough money?
Solution: Everyone has fears, but some people are better at managing them than others. And that's really the key -- managing your fears.
Try taking these steps:
Avoid playing the "what if" game -- learn to separate legitimate concerns from fears based primarily on emotion. Make a list of the legitimate concerns only.
Come up with an action plan that addresses each of the legitimate concerns, with the understanding that some risks can only be minimized, not eliminated entirely.
While it's easy to dream up unknown horrors, understand that there will also be unexpected advantages that will come your way also.
Realize that while there are risks to doing anything that is completely new, there are also risks that come from doing nothing. For example, if you lose your job in the middle of a deep recession you'll be facing all of your worst fears head-on, and none of them will be as a result of starting your own business.
Fear is never a reason to not go forward, but rather a call to manage the risks that are part of your legitimate concerns.
2. You're Comfortable on Your Job
Just as fear can stop you dead in your tracks, comfort can also keep you from moving forward, but for very different reasons. If you are too settled in your job, you might find it difficult to leave. But comfort isn't necessarily a tangible reason for staying in a situation, particularly if you have something better planned.
Solution: Recognize that the level of comfort you have on your job could very easily change. A new work assignment, a new boss, or even a new coworker can make that comfort level go away in short order. By starting your own business, you'll begin to build a new comfort zone -- one where you'll have infinitely greater control. Look forward to that, rather than focusing on the comfort of the moment that your job offers.
3. You Don't Have Any Savings
This is one of the obstacles that qualifies as a real problem. That is to say that it is an obstacle that you will have to fix before you can move forward. In starting a business, you'll absolutely need savings. You may need it to pay for start-up expenses, but you'll certainly need it to cover the missing cash flow that almost always attends the start of a new business.
Solution: If you don't have any savings you'll have to change that before you launch your business. Here are some ways to do that:
Delay the start of your business until you have the savings you need.
Sell off any possessions you don't need to raise capital -- your second home, a boat or even a car that isn't absolutely necessary.
Make sure that you have at least enough money saved to cover your living expenses for six months. Startup expenses will increase the requirement.
Absolutely don't borrow money to cover savings. You may need to borrow later, and you'll want to keep the channels clear.
4. You Have Too Much Debt
This is one of the most common reasons why people are reluctant to go into business for themselves. If it will be tough to generate enough cash flow to cover your living expenses, having to service debt from your previous life can make the effort close to impossible.
Solution: Once again, plan to delay the start of your business until you get your debt situation under control. Take a second job, cut your living expenses (are you noticing a pattern?), sell off any assets that have debts attached to them, and absolutely refuse to take on any new debt under any circumstances.
5. Your Cost of Living Is High -- And You Don't Want To Change It
One burden you will not be able to afford to carry into self-employment is an expensive lifestyle. This is one of the main reasons for business failures -- it just isn't possible to start a brand-new business while trying to support a luxurious lifestyle.
Solution: Twice I suggested cutting your living expenses -- in connection with saving money and paying off debt -- and it's an obvious repeat here. But you might have to take it a step further than that. You may have to take a close look at your structural expenses. This will include your home and the cars you drive.
If you're seriously committed to starting a business, you may have to consider moving to a less expensive home, and trading down on your transportation. Your chances of business success will improve if you do.
6. You Don't Have Enough Confidence in Yourself
At the root, this sounds like I'm not sure I can do this. Newsflash: you'll never know until you try. If you're doing something completely new, something you've never done before, you have to do it a few times successfully before you develop that confidence level.
Solution: Never let a lack of confidence hold you back -- it's perfectly natural. Instead create a plan that will help you develop the confidence you need. For starters, you can choose to go into a business that's related to work that you're either doing now or have done in the past. If it's something totally new, try getting your feet wet by taking a part-time job or some type of contract arrangement in a related business. This will enable you to get the experience and develop the confidence that you need to go forward.
7. You Don't Have 'The Perfect Plan'
The saying among carpenters is measure twice, cut once. But life isn't as exact as carpentry. Sometimes even after you've done all the measuring you can, you still don't have the perfect plan. Don't let that be your obstacle -- you'll never have a perfect plan no matter how hard you try.
Solution: Let go of the quest for perfection. Get started with the best plan you can come up with. Even more important than having perfect plan is to be prepared to be flexible in the face of changing circumstances. When you go into business, you'll have as many of those as you can handle, and dealing with them will be far more important than your original plan.
8. You Hate Sales
If you're going to go into business for yourself, you're going to have to embrace your inner salesperson -- there's no way around it. For a lot of people, this can be a huge obstacle -- one big enough to keep a person from ever starting a business in the first place.
Solution: Any time you've been on a job interview, what were you doing? You were selling! And what was the "product" you were selling? It was YOU!
That's the basic idea of selling when you have your own business too.
Drop any notions that you have to do stereo-typical "hard" selling, you probably won't need to. In today's world, it's easier to win people over with gentle persuasion than with the hard-sell. It's mostly about taking your product or service, and talking to potential customers about what makes it good. Not everyone will buy your sales pitch, but it doesn't matter.
You only need enough sales to make your business profitable.
If you think you need help in the sales area, take a course or two at a local college. Or take courses in public speaking. Once you get comfortable talking in front of people, sales is really pretty easy.
9. Your Family and Friends Might Not Approve
This is probably the worst excuse for an obstacle to going into business for yourself. But it is an obstacle for some people nonetheless. For example, if mom and dad put out a lot of money for the college education that landed you in the career you're in now, they may not be too pleased with your deciding to take a major detour.
Solution: Starting your own business has never about other people. After all, if the venture fails, they won't be the ones losing money on it. It's your life, and you have to do what you think is best. If your business thrives, you'll probably win them over anyway. Never let this be an obstacle.
10. You Don't Want to Go Through That Temporary Loss of Income Thing
This is another of those "real" obstacles. In the modern world, you need money to do just about anything you want to do. When you start a business, the temporary loss of income is an expected part of the package.
Solution: Rather than allowing this obstacle to stop you, instead concentrate on how you can work around it:
Have some money saved up cover your first few months of operation.
Take on part-time or contract work to help bring in an income while your business is ramping up. A part-time job with benefits might even be a better solution.
Start your business as a side venture, that way you can build a cash flow before taking the plunge on a full-time basis.
11. You Don't Like the Idea of "Wearing Multiple Hats"
This is a common problem with upstart small businesses, and it falls in the category of real obstacles. If you have been working in a formal employment situation for a number of years, you're probably very accustomed to working on a small piece of your employer's business. But when you're in your own business, you're responsible for everything, and that's a real juggling act.
Solution: There's no way to get around the multitasking issue when your business is first starting out. Try to focus on the future, when you'll have sufficient cash flow to pay others to help with the workload.
In the meantime, concentrate on the activities that are most important to getting your business up and running. Most likely, those functions will be marketing and sales. These are the activities which will generate your cash flow, and eventually provide the funds to pay others to do jobs you don't want to handle.
Plan on spending most of your daytime hours working on those core activities, saving the rest to work on in the evening. Until your sales start to grow, those other functions probably won't require much time and attention anyway.
12. You're Worried About How and Where You'll Find Customers and Clients
This is a perfectly legitimate obstacle, and the only to address it is by having a game plan up and running.
Solution: In Obstacle No. 10, I recommended starting your business as a side venture to get a cash flow going before taking the business full-time. The same advice applies here -- by starting your business as a side venture while you hold your job, you have an opportunity to get a few customers and clients in before you start flying solo.
In addition, find out what other people in the same line of business are doing to get customers and clients, learn all you can about it, and do what they're doing. The age old advice applies here: never try reinventing the wheel.
13. You're Worried About Losing Your Company Benefits
Another legitimate obstacle, but one which is mostly temporary.
Solution: Plan to go on your spouses benefits, if he or she has a job that provides them. If not, opt to take the least expensive health insurance plan you can get, the cheapest term life insurance you can get, and let go of any notions of funding your retirement until your business has a solid cash flow.
Once it does, you'll be in a position to get all the benefits you currently have on your job, and then some. For example, Solo 401(k) plans for the self-employed can be much more generous than company sponsored 401(k) plans provided to employees.
It's definitely something to look forward to.
14. You Have Hobbies That Take Up a Lot of Your Time
If you're thinking you may need to give up your weekends on the golf course, you're probably thinking in the right direction. As explained in Obstacle No. 11, you'll need all the time you can get for all the hats you'll be wearing in your business.
Solution: The loss of hobby time will almost certainly be temporary. Once your business reaches the point of providing you with a living wage, you can start getting back into leisure activities. You'll still need decompression time, but it will need to be in activities that aren't so all-encompassing.
BONUS: Eliminating major hobbies will not only help free up your time, but it's also a way to lower your expenses. Plus, you might actually be able to make money from your hobbies.
Solution: This is another issue that's emotion driven, so you will have to find a way to manage it or it can turn into a obstacle to running your business forever. Here are some suggestions:
Understand the sense of security you attach to a job may be an illusion. A sudden job loss is all it will take to prove the point.
Having your own business is often more secure than holding a job. For example, if your business declines, you can find new sources of revenue (something you should always be doing when you're self-employed anyway). If you lose your job, it's goodbye income, and you'll have to start from scratch.
Recognize there truly is no security in life, so personal preferences do matter.
Develop a business plan than will include the creation of multiple income sources, which will make your business more secure than your job ever was.
If you want to start a business, understand obstacles are not stop signs, but challenges you need to overcome. If you can embrace that idea when you start your business, you'll be fully prepared to deal with whatever confronts you later on.
One of the easiest ways for frequent shoppers to increase their savings is to pick up discount gift cards at gift card swapping websites. It's not uncommon for well meaning family members, friends and coworkers to give you a gift card to somewhere you have no intention of ever shopping. Sure, you could re-gift that sucker (which really isn't a bad idea) or you could sell it on one of these sites.
The Latte Factor
When you list a gift card on a site, you usually select the amount you want to sell it for. I am a Starbucks addict. Like any good personal finance guru in training, I keep my addiction in check, but I also look for creative ways to get my caffeine fix at a discount.
Since I know I'm going to be a repeat customer, I buy Starbucks cards in $100 increments from the gift card swapping sites anytime I can find them discounted at least 15 percent. I wait for weekends when Raise has its additional 5 percent off sale, and then I load it onto my Starbucks rewards card, which gets me a free coffee for every 12 stars that I earn. My roughly $75 investment usually yields about 21 coffees and lasts me about four months. That's not that bad, especially when you consider how much I enjoy it.
All it really required was knowing my shopping habits, five minutes to sign up with a gift card site, five minutes to sign up with Starbucks rewards and, finally, the effort it takes to remember to watch out for Raise's extra 5 percent sale when my balance gets down to around $25.
Where to Buy and Sell
Some sites also allow you to swap one type of gift card for another without losing any value on the swap -- Dunkin' Donuts for Starbucks, for example, depending on your preferences. Here are five of my favorite sites for picking up discounted gift cards or making a few bucks with your own rejects:
Raise is really easy to navigate and often has sales sponsored by the site that can be layered on top of the already discounted gift cards.
Gift Card Granny has a section called Flash Deals that has extra discounted cards that are in short supply, pooled from all of the discount gift card sellers online.
Cardpool has a cool wish list section that lets you collect the cards you'd like and share with friends and family, great for holidays and birthdays.
Giftcard Zen has a nice, large collection of gift cards that infrequently runs out of the larger, more popular stores.
Card Cash touts it 45-day balance guarantee, so if you have any issues with your purchased card, it will cover it. It also has background checks for card sellers.
Since most of these sites have both physical and electronic gift cards, you can often find great, fast deals for impromptu gifts. Combining gift card websites with brand loyalty programs is one of the easiest ways to rack up big rewards fast with minimal effort.
Mel Bondar blogs at BrokeGirlRich, where she explores topics including how not to totally panic over adulthood, working in the arts and retirement strategies that don't involve living in a cardboard box under an overpass.
According to a survey done by the American Farm Bureau Federation, the ground chuck you'll need to make those juicy burgers costs 12 percent more this year -- about $4.61 per pound -- compared to a survey conducted a year ago. Grilled beef sirloin tips will cost you even more -- up 14 percent to $5.71 per pound.
Planning ahead, you are more likely to find the items you want in bulk or on sale. If a good deal is found far in advance, you can always freeze the beef beforehand. You can also just scrimp on the burgers and throw more hotdogs and bratwursts in the mix. Go healthy and grill more chicken instead. The same survey found that the price of chicken breast is down 7 percent to $3.28 per pound.
But the cookout shouldn't just be all about the grilled meat. If you're hosting, here are 10 things to consider for a fun, safe and budget-friendly barbecue.
1. Lawn Games
Lawn games are commonly forgotten additions to a cookout. It's not until the guests have arrived and begun to settle in that the absence of lawn games becomes apparent.
Games such as cornhole, bocce and croquet can be enjoyed by nearly all age levels and can be as competitive or casual as the players would like. These games are great for socializing, so guests don't need to focus too much on what's cooking. If you don't have any lawn games, you can suggest guests bring their own favorites, which increases the options without hurting your wallet.
2. Beer
OK, beer itself is rarely overlooked at a cookout. The possibility of running out of beer (and food) is a concern of nearly every host. As a result, there is often an excess of both. Hosting a BYOB barbecue is an easy way to cut down on your costs. Many guests even prefer to bring their own drinks, since their beer (and other drink) preferences often differ. Beer can also add an entertainment aspect to your cookout. If you're looking to impress your guests, try grilling an entire chicken with a beer can inside of it.
3. Ice Cream
Give your guests something cold and sweet to look forward to after an afternoon in the sun. While serving the burgers, you can always say, "leave room for dessert." That should keep your guests from having too many grilled meats.
Ice cream is a cheap and easy-to-serve addition to any barbecue. If clean up and extra utensils aren't an issue, buying a tub of ice cream is likely to be your best option on a budget. Otherwise, single-serve ice creams like popsicles, king cones and cookie sandwiches are easier to pass around. Breyers, Good Humor, Klondike, Magnum, and Popsicle have all introduced new and interesting flavors in time for summer -- from Hershey's Mini Kisses Caramel to Girl Scouts Thin Mints.
Kids at your barbecue will enjoy the flavors and packaging of Popsicle Frozen, inspired by the Disney movie, which retails for $3.99 for a 16 or 18-count box.
4. Sturdy Tools
Where I come from (the Northeast), the word "barbecue" usually refers to the grill itself, a gathering of people or a method of cooking. Enthusiasts, especially from the Southeast and Southwest, refer to barbecue as meat smoked for hours; chopped, sliced or minced; and served with a sauce that's thick and sugary, vinegar or ketchup-based.
Whichever type of barbecue you're going for, it's important to have sturdy grilling tools. You wouldn't want to waste a good steak or burger because of a flimsy set of tongs. If you're not using the right tools, you'll likely have to buy new ones year after year. So spend a good amount of time researching what gadgets you'll need for your next barbecue.
After the food has been cooked, it's important to keep your grill clean for the next time you use it. A clean grill also keeps future food from sticking to the grate, and keeps bugs from hanging around your grill. Brushes with steam cleaning, like the Motorized Grill Brush with Heavy-Duty Steam Cleaning Power from Brookstone, loosen the remaining grease and grime from a hot grill. Since this brush is also motorized, it does all the heavy-duty scrubbing for you.
5. Gloves
Just as regular kitchen tools aren't meant to be used with a grill, neither are the oven mitts you usually use while cooking. Grills can be unpredictable and dangerous in an instant. A burst of flame at an unexpected moment can mean a trip to the ER, so having a fire-resistant glove is essential. The Ove Glove uses the same materials used to make firefighters' flame-resistant clothing, and can be used in temperatures of up to 540°F, so there's no need to ruin your oven mitts trying to flip a burger.
6. Wood Planks
Cooking food on wood planks is a unique way to use your grill. Most people associate the planks with cooking salmon, but it can be used for pork, chicken, beef, shrimp and many types of fish. Wood planks are also a great way to cook food that you found on sale that might otherwise be a less interesting dish than food traditionally found on the grill. Just make sure you're familiar with the kind of wood being used, as each is distinct and will flavor the food being cooked on it.
7. Meat Thermometer
Meat thermometers are an incredibly handy tool to have. It doesn't take long for meat to go from undercooked to overcooked, and there's no guarantee that different pieces of meat will cook at the same rate, even when placed next to one another. A meat thermometer can take the guesswork out of grilling. A leave-in thermometer, such as the ThermoWorks ChefAlarm, enables you to monitor the temperature of the meat without repeatedly checking it. For those looking for a more budget-friendly alternative, instant-read thermometers work just as well with the meats you cook on the grill and in the oven.
8. Portable Speakers
Put on the music while you put on the barbecue show. Make it fun and interactive by allowing your guests to choose the music or suggest a play list. You can even have "name that tune" as one of your barbecue's highlights. Newer portable speakers like the Beats Pill can be connected by Bluetooth, which allow them to be controlled from afar.
9. Citronella Candles
While there are some people who seem unaffected by mosquito bites, others are not so lucky. To make sure all of your guests are comfortable as the sun goes down, reusable citronella candles look great and add extra light, all while keeping the bugs away. Having a few citronella candles around also means that no one needs to be covered in bug spray, which we can all be thankful for.
10. Hand Sanitizer and Sanitizing Wipes
Hand sanitizers are always good to have when you're serving lots of finger foods. Guests with kids will appreciate this and will keep them from using too many of your paper napkins. For final clean up, sanitizing wipes work wonderfully. It's always a good idea to wipe down areas that have been near raw meat as soon as possible to keep bacteria from spreading.
NEW YORK -- Not checking your credit score is like not going to a doctor for a check-up, but this indifference could be hazardous to your financial health.
One-third of Americans avoid or otherwise miss credit score checks, according to Bankrate.com (RATE), with 44 percent of seniors and 41 percent of millennials stating they've "never checked their credit scores." Only one-quarter of Americans check their credit scores at least once a year, Bankrate reports.
The ones going without are taking a big risk, experts say.
A good credit score will help you, among other things, qualify for the best rates on loans.
"Monitoring your credit goes well beyond scanning a three-digit number," says Jeanine Skowronski, credit card analyst at Bankrate.com.
"A good credit score will help you, among other things, qualify for the best rates on loans," Skowronski says. To improve it, "Americans need to thoroughly review their credit reports for errors or signs of fraud. They also need to understand what factors, like missed payments or high debt-to-available credit ratios, are driving their credit score."
Bankrate advises consumers to check their credit scores at least three times a year, a figure other financial experts generally support -- and everyday Americans, too.
"I've become something of a credit experts over the years," says Dan Nainan, a New York City actor and comedian. "My credit was horrible, but now my FICO score is over 800." Nainan says he gets a free copy of his credit report from each of the three major credit reporting agencies -- TransUnion, Experian and Equifax -- asking for a copy once every four months from each firm consecutively. "That way, you can stay on top of your credit," he says. "And technically, you can get a free report at any time just by saying that you were denied credit."
But don't focus too much on the actual credit score when your review a report. Instead, home in on the line-by-line personal financial information.
"The problem with the free reports is that you do not get a credit score," says Danny Garcia, founder of the credit repair firm PayAfterDeletion.com. "What most consumers don't know is that it is impossible to get your real credit score from any of the credit monitoring services, as none of these services provide a score that is actually used by the lender."
It's much more productive to focus on the data being reported, as it is the data that ultimately generate the score, Garcia says. "Also, the consumer should check to see what data is reporting and ensure that it is reporting 100 percent accurate. If even one item is inaccurate, the score can be affected by over 100 points."
Perhaps the best advice is to target the behaviors that lead to bad credit and turn those behaviors into habits that lead to a higher credit score. "If you know you've abused your credit in the past -- paid bills late, defaulted on debt, maxed out credit cards -- you may be curious," says Coleen Pantalone, a finance professor at Northeastern University. "In all likelihood, your credit score will be low, and any loans you are able to get will carry higher rates." "
"A better thing to do than checking the score is to begin working to restore your credit," Pantalone says. "Budget. Don't overspend. Pay bills on time."
Getty ImagesCreating a detailed budget will give you a financial roadmap and provide some valuable peace of mind.By Lou Carlozo
"Take a deep breath." "It's never too late." "Get some professional help." While those snippets are indeed culled from experts, they're not therapists -- though you might need one while facing the panicky prospect of a bone-dry retirement account.
If you're a baby boomer on the cusp of retirement, you could find yourself staring down this problem soon. Perhaps you missed out on compound interest by not investing young. Maybe the Great Recession decimated your individual retirement account. Medical or financial emergencies might've forced you to tap your funds as a last resort.
No matter the cause, refreshing a depleted retirement account is tough -- unless, of course, you've gone "bucket list" and want to drain it now. A newly released HSBC global retirement survey of 1,001 people age 25 and older shows that about 1 in 4 working Americans feel it's better to spend all their cash during the course of a lifetime and let children create their own wealth.
Dipping into an IRA "isn't necessarily a bad idea," says Brian Schwartz, vice president and senior financial adviser at HSBC Bank USA in Farmingdale, New York. "A client once told me: 'Now the clock is ticking on me.' They want to start doing the things they've always dreamed of but had to put aside to take care of the costs associated with raising a family."
But what if the clock's also ticking on your dream of financial security? Here are 10 nuggets of wisdom from investment pros -- meant to help cook a slender nest egg into something to feed you in retirement.
Don't throw the 'Hail Mary' pass. What seldom works in the closing seconds of a football game could spell disaster in the retirement game, says Kendrick Wakeman, CEO of FinMason, a financial education company. "Please don't put all your money into high-risk investments in the hopes of scoring some sort of a big win that will suddenly allow you to retire in the manner you dreamed about in your 20s," Wakeman says. That even means approaching stocks with caution. "As you get closer to retirement, the risk of loss in the stock market looms larger since there will not be much time to recover after a crash," he says.
Consider overlooked financial resources. While it's risky to count on unknowns such as real estate appreciation, you may have cash streams available outside the traditional retirement realm, says Jennifer Acuff, wealth adviser with TrueWealth in Atlanta. For example, "Understand your options with respect to Social Security and any pensions you might be entitled to from current or previous employers," she says.
Sacrifice. Numbers don't lie, but the bright side is that decreasing your expenses will help smaller retirement pools shrink slower, says John Diehl, senior vice president of strategic markets at Hartford Funds. "There is hope that some of these folks can make up cash shortfalls, but it may require sacrifices, which some people refuse to make," he says. And here's a pointed perspective from Michael Chadwick, CEO of Chadwick Financial Advisors in Unionville, Connecticut: "It's amazing when I work through the numbers that some people think manicures, landscapers and maids are a need," he says. "I've found people with less stressful and happier lives -- as they're not trying to substitute physical possessions for personal happiness."
Define 'comfortable retirement.' Especially if you've gone into your hand-wringing with a preset number or a vague image of cruise line frolic, it's time to get down to brass tacks. "Many boomers haven't really thought this through, while others are in full-stage denial," says Bellaria Jimenez, managing director with MetLife Premier Client Group, based in Cranford, New Jersey. "Unfortunately, many of these boomer clients do not have the accumulated assets they will need to provide for the 'comfortable' lifestyle they envision." That's when the time comes for a sharper picture that pays attention to the financial realities at hand -- along with the ones that can be changed.
Play the Social Security card. You won't survive solely on the money in your retirement fund, but from Social Security as well, says George Fraser, managing director of Retirement Benefits Group in Phoenix. "I advised one 66-year-old client making $26,000 a year to immediately file for his Social Security benefit since it was more than his salary," he says. The $32,000 a year he and his wife received in government benefits allowed him to use nearly all of his salary to make the maximum contribution to his company's 401(k) plan. That $24,000 a year "made a big difference," he says.
Create a detailed budget. Accounting for the money coming in and going out will give you some peace of mind in catching up by way of a road map. However, "We are not talking about scribbling a few figures on a napkin," Wakeman says. "You need to get a detailed budgeting tool such as Mint.com or LearnVest.com ... These tools can help you develop a budget that lets you start saving for retirement and, just as importantly, helps you stick to it."
Free up money by lowering fees. Assuming you have some investments going, chopping those fees can make a shocking difference, says Erik Laurence, vice president of marketing and business development at FeeX, a free service that finds and reduces hidden fees within investment accounts. "All else being equal, if you can reduce your fees from 1.75 percent down to 0.25 percent, this is equivalent to an additional 1.5 percent per year of return that will compound to help top off your account," he says.
Work a little longer. If you're looking forward to hanging up your hat now, this prospect may not appeal to you -- but it can provide extra padding for when it really counts. "The good news is this type of approach can work," especially when coupled with smart budgeting, says David Twibell, president and founder of Custom Portfolio Group in Englewood, Colorado. He's helped clients who survived the 2008 market crash, "and to their credit, they faced this challenge head on, cut back on their expenses and decided to work a little longer than they originally expected. Their hard work paid off and they are now retired with enough savings," he says.
Work the 'three levers.' A secure retirement, no matter your current situation, balances out your savings level, time until retirement and spending level in retirement. "That's often the secret -- looking for ways to make incremental changes across multiple fronts, which together can provide much more leverage than any one strategy alone," says Dave Yeske, managing director at the wealth management firm Yeske Buie and director of the financial planning program at Golden Gate University's Ageno School of Business. "The beautiful part of this story is that all three of those levers are within your control."
Keep calm and (don't) tarry on. What sounds like mere behavioral advice will make all the difference regarding the speed and rationality you take to your retirement quandaries. "Avoid panicking or standing out on a ledge," says Catherine Collinson, president of Transamerica Center for Retirement Studies. "It's totally counterproductive and a waste of precious time and energy that could be put to better use in terms of taking steps forward to improve your financial situation." One step she recommends is both commendable and courageous: "Take a close look in the financial mirror."
Tony Avelar/APGoogle's new self-driving prototype car is presented during a demonstration at the Google campus in Mountain View, Calif.By DEE-ANN DURBIN
MOUNTAIN VIEW, Calif. -- The latest version of Google's self-driving car -- a pod-like two-seater that needs no gas pedal or steering wheel -- will make its debut on public roads this summer, a significant step in the technology giant's mission to have driverless cars available to consumers in the next five years.
This prototype is the first vehicle built from scratch for the purpose of self-driving, Google says. It looks like a Smart car with a shiny black bowler hat to hide its sensors, and it can drive, brake and recognize road hazards without human intervention. It has more capabilities than the prototype Google introduced last May, which was so rudimentary it had fake headlights.
The new pod isn't designed for a long trip, or a joyride. It lacks air bags and other federally required safety features, so it can't go more than 25 mph. It's electric, and has to be recharged after 80 miles. And the pod can only drive in areas that have been thoroughly mapped by Google.
At first, it will likely even have a steering wheel and gas pedal -- current California regulations require them. Those regulations also require a driver to be able to take back control of the car at any time. But Google is lobbying for more flexible regulations.
Google will initially build and test 25 pods, mostly in neighborhoods surrounding its Mountain View headquarters. It will eventually build between 50 and 100, and will broaden testing to sites that are hillier and rainier.
The ultimate goal, says Google co-founder Sergey Brin, is computer-controlled cars that can eliminate human error, which is a factor in an estimated 90 percent of the 1.2 million road deaths that occur worldwide each year. Self-driving cars could also improve traffic congestion and transport the elderly and disabled.
Sharing Technology
Google shocked the auto industry in 2010 with its announcement that it was working on a driverless car. Brin insists Google doesn't aspire to be a car company, but wants its technology to be adopted by automakers.
"We want to partner to bring self-driving to all the vehicles in the world," Brin told a group of journalists and community members gathered earlier this week to take rides in the prototype.
For now the traditional automakers are pursuing their own self-driving technology, but with less ambitious timeline of 10 to 15 years for a truly driverless car.
Chris Urmson, who directs Google's self-driving car project, says the slow-moving, friendly looking prototype -- his young son thinks it looks like a koala because of the nose-like black laser on the front -- is a good bridge between the company's current test fleet of 20 specially outfitted Lexus SUVs and the more advanced, higher-speed driverless cars of its future, which might not even look like anything on the road today.
"This vehicle is really all about us learning. This vehicle could go on a freeway, but when we think about introducing the technology, we want to do that very thoughtfully and very safely," Urmson says.
Convincing drivers that driverless technology is safe is one of the hurdles the company must overcome. Earlier this week, in response to questions from The Associated Press, Google acknowledged 11 minor accidents in the six years it has been testing autonomous cars. Urmson says the company is proud of that record, and notes that Google's vehicles have completed more than 1.7 million miles of testing. He says all but one of the accidents were caused by drivers in other cars; in the only incident caused by a Google car, a staffer was driving in manual mode.
Consumers question whether they can trust self-driving cars to work all the time, who will be liable if there's an accident and how self-driving cars will interact with regular cars, says the consulting firm J.D. Power and Associates. In a 2013 survey of U.S. drivers, J.D. Power found only one in five was interested in a fully autonomous car.
Education and Feedback
Urmson says Google needs to do a better job of educating people about self-driving technology and updating them on Google's progress. It's building a Web site to teach people about the technology, and the site will feature a monthly report that will include details of any accidents involving Google cars. The site will also have a section where people can send feedback when they interact with the cars.
The prototype cars -- assembled in suburban Detroit by Roush Industries -- have the same array of radars, lasers and cameras as Google's fleet of Lexus SUVs, which allows them to share data. If one car's camera spots orange cones and construction signs, for example, it will alert all the others to slow down in that area or reroute around a lane closure.
Dmitri Dolgov, the head of software for the self-driving car project, says Google's software has gotten much better over the last year at classifying objects, like trees and mailboxes, and predicting behavior of pedestrians and other cars. For example, Google's cars will slow down if they sense that a car in the next lane is speeding up to cut in front of them. And in one recent test, a Google car paused when a cyclist ran a red light. Another car, driven by a human, went ahead and nearly hit the cyclist.
The system isn't perfect. On a test drive, one of Google's Lexus SUVs seemed momentarily confused when a mail truck partially blocked its path. Later, during a demonstration drive in Google's parking lot, the prototype -- without a wheel or pedal -- braked when it spotted a row of folding chairs. It had to figure out that the chairs wouldn't move before it proceeded.
Dolgov says it's impossible to predict everything its test cars might see, so they're programmed to act in the most conservative way when they confront something unusual, like the time a Google SUV stopped and waited while a woman in a wheelchair chased a duck with a broom.
Feature-by-Feature
Google isn't alone in developing self-driving cars. Mercedes-Benz, Infiniti and other brands already have advanced driver assistance systems, like lane keeping and adaptive cruise control, that can pilot the car on the highway with minimal input from the driver. Unlike Google, automakers think self-driving cars will arrive feature-by-feature instead of all at once, giving people plenty of time to adapt to autonomous driving.
But Urmson says that approach is "fundamentally wrong."
"We believe that's like saying, 'If I work really hard at jumping, one day I'll just be able to fly,'" he said.
Egil Juliussen, the principal analyst of infotainment and advanced driver assist systems for the consulting firm IHS Automotive, says Google's "moon shot" strategy is difficult and riskier than just adding features to existing cars. But he thinks it could ultimately be successful. Google could make self-driving urban pods for universities or urban centers, for example, or sell its technology to automakers.
Brin says the company is still refining its plans for self-driving cars, but he's excited about their potential.
"Our goal is to create something safer than human drivers," he said.
DETROIT -- Toyota Motor (TM) is recalling 637,000 vehicles in the United States as part of a massive expansion of a global recall to replace potentially defective air bags that could rupture and send shrapnel into occupants.
The vehicles are being recalled in three separate campaigns, according to documents posted early Friday by the National Highway Traffic Safety Administration.
The air bags were supplied by Japan's Takata Corp. More than 36 million vehicles equipped with Takata air bags and sold by 10 manufacturers have been recalled worldwide since mid-2009.
Earlier this week, Toyota in Japan said it would expand its global air bag recalls by nearly 5 million vehicles.
As part of that effort, Toyota is recalling 300,000 vehicles sold in high-humidity U.S. states and territories, including the 2005-2007 Corolla, Corolla Matrix and Sequoia, 2005-2006 Tundra and 2005-2007 Lexus SC, as well as the 2005-2007 Pontiac Vibe made for General Motors Co.
Toyota is also recalling 177,000 2003-2004 Tundra and 2004 Sequoia, as well as 160,000 2004-2005 RAV4.
With all of the recalls, NHTSA said "the inflator could rupture, with metal fragments striking and potentially seriously injuring" vehicle occupants.
In a statement, Toyota's U.S. subsidiary said "multiple investigations into the root cause of the potential for inflator rupture are taking place."
"The climate problem requires more than 90 percent reduction of CO2 emitted, and no amount of efficiency improvement is enough."
With those "optimistic" words, Bill Gates lit the fuse on the keg of dynamite that is America's green power lobby. Four years ago, the Microsoft (MSFT) co-founder-turned-save-the-world-activist crushed environmentalists' dreams of the world going "clean energy" to reverse the course of global warming. According to Gates, solar and wind power are nice technologies as far as they go -- but the idea that they could save the world?
Mr. Softy dismissed that idea as "cute," but quite simply unrealistic.
And he was right.
Green Energy Costs Too Much Green
As Gates explained it, the problem with green energy isn't that it doesn't work, but that it doesn't work fast enough. Whether you're talking about energy efficiency ("cash for caulkers") or improvements in the rate at which solar power plants and windmills convert sunlight and wind, respectively, to electricity -- pretty much any kind of green energy you name adds to the total energy supply of the world. But because the global population keeps increasing, new energy needs to outpace the rate of new green energy supplies. The United Nations estimates that global population will increase to somewhere between 7.5 billion and 9 billion by 2040. This necessitates building "dirty energy" sources -- plants powered by coal, for example -- to keep up with the rising power demands of a growing population.
Result: Despite adding megawatts of green energy every year, the world is still getting dirtier. In a recent report, the U.S. Energy Information Administration estimated that through 2040, global energy demand will increase by 56 percent, while the addition of dirty fuel sources will grow carbon dioxide emissions by 46 percent. In short, while green energy production will slow the growth of CO2 emissions, it can't stop -- much less reverse -- the trend.
Adding to the problem, despite marked reductions in the cost of solar power panels, for example, green energy continues to be one of the more expensive forms of energy available. Turning again to EIA reports, we find that most forms of solar- and wind-produced green energy cost more than the equivalent amount of megawatts generated by natural gas-fired power plants. In the best cases, these forms of green energy are anywhere from 21 percent to 367 percent more expensive. More pessimistic estimates put the disparity at as much as 20 times more expensive.
Tiny Atoms, Big Potential
Gates' solution: nuclear power. In 2010, Mr. Gates joined a group of investors putting $35 million into cutting-edge nuclear tech firm TerraPower, which he now chairs. TerraPower aims to develop a wholly new class of nuclear power generator that's 50 times more efficient than current-generation reactors, eliminates the need to reprocess spent nuclear fuel, and could be ready for deployment in less than 10 years. Reuters reports that the project will cost "billions," but the promise of 50-times improvement in efficiency suggests this could still be a bargain in comparison to current nuclear technology -- which the EIA says is already cheaper than offshore wind power, solar thermal, or solar photovoltaic.
If TerraPower's promises bear fruit, then the 50-times improvement in efficiency alone -- 5,000% -- promises to race ahead of Earth's rate of population growth and head it off at the pass. Expanding the use of CO2 emission-less nuclear power would then have a fighting chance of providing the extra power we need without accelerating global warming -- and potentially even reversing it.
Now here's the problem: According to a March Gallup poll, Americans' support for nuclear energy recently hit a near-20-year low. According to Gallup, just 51 percent of Americans favor the use of nuclear energy in the U.S. today. That's down 11 percentage points from where nuclear energy support peaked five years ago. And if the trend continues, we could be headed back to the absolute nadir for nuclear energy these past 20 years, when support briefly sank to 46 percent (in 2001).
At the same time, Gallup notes that solar and wind power -- which cost up to twice as much as nuclear but get much better press -- are enjoying banner days among American voters. According to Gallup data, solar power and wind are, respectively, the two most popular forms of energy among American voters. Of those polled, 79 percent favor the U.S. putting more emphasis on developing solar power, and 70 percent favor more wind.
But the sad truth of the matter is that, if Bill Gates is right, and if the EIA is right... then 70 to 79 percent of the rest of us want to do "clean energy" all wrong.
Motley Fool contributor Rich Smith likes the idea of cheap, clean, 50-times-more efficient nuclear power. But like most Americans, he's not really thrilled at the idea of having a nuke plant planted in his backyard. (And that may be precisely our problem.) Rich does not own shares of any company named above. Nor does The Motley Fool.Check out our free report on one great stock to buy for 2015 and beyond.
Darden Restaurants via APThe addition of breadstick sandwiches are Olive Garden's latest attempt to revamp its menu and marketing as sales have declined for the past three years.
There were plenty of winners and losers this week, with the country's largest Italian casual-dining chain announcing a new sandwich and the Blizzard royalty sending mixed signals with its latest menu move.
The financial services giant is returning more of its money to shareholders. American Express announced that it would be purchasing as many as 150 million shares, boosting the power of an earlier buyback plan that still had 45 million shares left to purchase on the open market. American Express is also boosting its quarterly dividend by 12 percent to 29 cents a share. The move pushes its yield to 1.5 percent.
Macy's (M) also announced a payout hike and a stock buyback, but it didn't make the cut this week because those treats accompanied a quarterly report by the department store chain that was surprisingly light.
Mobile gamers can be fickle. King Digital continues to shed players of its defining "Candy Crush Saga" game, and it can't seem to develop new titles to make up for the defections quickly enough.
King Digital clocked in with gross bookings of $604 million in its latest quarter, 6 percent below where it was a year earlier. That's not so bad -- and it was actually a sequential uptick -- but then King Digital rained on its own parade by warning that bookings for the current quarter will come in between $490 million and $520 million. That's a sharp sequential drop, even with seasonal tendencies.
Olive Garden -- Winner
A breadstick sandwich is coming to the rescue at Olive Garden. Darden Restaurants (DRI) revealed that its traffic-hungry casual Italian chain will introduce a new line of sandwiches served on breadsticks as buns.
The meatball or chicken Parmesan options will come with fries as well, and yes, unlimited breadsticks. Darden knows how to milk its signature menu items. Just before it unloaded Red Lobster two years ago it rolled out a lobster pot pie with the chain's addictive Cheddar Bay biscuit in crust form. A new sandwich line isn't enough to end the streak of two years of negative declining store traffic at Olive Garden, but it should generate plenty of free publicity for the chain hungry for attention.
Berkshire Hathaway's Dairy Queen is removing sodas as a choice from its kid meals. The move, in theory, makes sense. Sugary soft drinks have been tied to childhood obesity, and Dairy Queen becomes the latest chain that serves fast-food to go this route.
However, this makes the cut as a losing move because Dairy Queen still includes decadent ice cream as treats in its kid meals. Are you telling me a small cup of Coke is worse than a Dilly Bar with 220 calories and 10 grams of saturated fat?
This also makes the cut because Berkshire Hathaway happens to be Coca-Cola's (KO) largest shareholder.
The leading social networking website is throwing media companies a bone. Facebook is rolling out Instant Articles, a platform that lets select media companies publish articles directly from Facebook. The first wave of publishers includes New York Times, BuzzFeed, and National Geographic.
It's a win-win-win. Facebook users get articles that load quicker. Facebook keeps folks on its site. Media companies get to keep 100 percent of the ad revenue that they sell. They can also turn to Facebook's revenue-sharing marketing platform for unsold inventory and collect 70 percent of that.
It's yet another smart move by the dot-com darling.
Motley Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends American Express, Berkshire Hathaway, Coca-Cola and Facebook. The Motley Fool owns shares of Berkshire Hathaway and Facebook and has the following options: long January 2016 $37 calls on Coca-Cola and short January 2016 $37 puts on Coca-Cola. Try any of our Foolish newsletter services free for 30 days. Looking for a winner for your portfolio? Check out The Motley Fool's one great stock to buy for 2015 and beyond.
WASHINGTON -- U.S. industrial production unexpectedly fell for a fifth straight month in April due in part to a further decline in oil and gas drilling, suggesting that the economy is growing at only a modest pace in the second quarter.
Coming on the heels of weak retail sales and producer inflation data this week, the reports suggest the Federal Reserve probably won't raise interest rates anytime soon.
These are not the numbers that would inspire confidence in the Fed to tighten policy.
"It means in the next month or so we are unlikely to see a massive rebound in growth momentum. These are not the numbers that would inspire confidence in the Fed to tighten policy," said Millan Mulraine, deputy chief economist at TD Securities in New York.
Industrial output slipped 0.3 percent after a similar decline in March, the Fed said. Economists had expected a 0.1 percent gain.
A plunge of 14.5 percent in oil and gas well drilling pushed mining production down 0.8 percent last month. It was the fourth straight monthly decline in mining output.
Crude oil prices have fallen by about 50 percent since last June, resulting in a sharp drop in well drilling activity.
Companies such as Schlumberger (SLM), the world's No. 1 oilfield services provider, and Halliburton have slashed their capital spending budgets for this year. Caterpillar (CAT) has cut its 2015 profit outlook and warned that lower oil prices would hurt its energy equipment business.
Oil and gas drilling is down 46.5 percent over the year and there is no relief in sight despite the recent stabilization of crude oil prices. Oil rig counts continued to decline early in the second quarter.
"We see a further drop in mining investment over the next few quarters and are not convinced that business investment ex-mining will be strong enough to sufficiently offset this drag," said Michelle Meyer, a senior economist at Bank of America Merrill Lynch (BAC) in New York.
Sentiment Sours
In a separate report, the University of Michigan said its consumer sentiment index fell to 88.6 early this month, the lowest reading since October, from 95.9 in April.
There were slight declines in consumers' attitudes toward purchases of motor vehicles and homes.
While economists noted the weak relationship between consumer confidence and consumer spending, they nevertheless saw May's decline as unfavorable. Many of them believe that consumer spending will accelerate in the second quarter as households start drawing on their savings from relatively cheap gasoline prices.
"All things considered, the decline in confidence means that the potential for a pick-up in consumption growth over the next few months is probably smaller than we previously anticipated," said Paul Ashworth, chief economist at Capital Economics in Toronto.
The economy was slammed earlier in the year by bad weather, port disruptions, a strong dollar and deep spending cuts by energy firms. The government reported last month that GDP expanded at a 0.2 percent annual pace in the first quarter.
But trade and inventory data published after the GDP snapshot suggested the economy actually contracted. Second-quarter growth estimates are currently hovering around a 2.5 percent pace, well below the 4.6 percent pace in the same period last year.
U.S. stocks were marginally weaker, while prices for longer-dated U.S. government bonds rose. The dollar slipped against a basket of currencies.
Dollar Dampens Manufacturing
Last month, utilities production tumbled 1.3 percent, also contributing to the weakness in industrial output. Manufacturing production was unchanged after gaining 0.3 percent in March. It was restrained by a 0.9 percent drop in machinery, though motor vehicle production rose.
Manufacturing, which accounts for about 12 percent of the economy, has been dampened by the dollar. Even as the greenback rally fades, factory activity is unlikely to rebound strongly.
In a separate report, the New York Fed said its Empire State general business conditions index rose to 3.09 in May from -1.19 in April. A reading above zero indicates expansion.
While new orders rebounded this month, order books remained depressed and inventories swelled. Labor market indicators also weakened a bit.
"They suggest any pick-up in manufacturing activity will be muted, at best," said Jesse Hurwitz, an economist at Barclays in New York.
Store-bought greeting cards can get pretty costly, with prices going up to as much as $10 a card. However, there are ways to send personalized greeting cards on a budget. You just have to know where to look.
