Friday Financial Five—April 19th, 2013
Friday, April 19, 2013
Unemployment in RI drops again
It’s great news that the jobless rate in Rhode Island continued to drop in March, reaching 9.1 percent. Naysayers will point to the number of people dropping out of the workforce and other nuances of an imperfect calculation. The question is, why does the state continue to lag Massachusetts by such a wide margin and what’s being done about it? In March, Massachusetts unemployment came in at 6.4 percent, well below the national rate of 7.6 percent.
Social Security and the “Chained CPI”
A part of President Obama’s budget that has retirees’ attention is to change the Social Security COLA (Cost of Living Adjustment) to the “Chained CPI”. Chained CPI is supposed to be a more accurate measure of price increases over time because it takes consumer behavior into account. The White House hopes switching these measures will reduce the increase in Social Security payments by roughly 0.3 percent. It doesn’t sound like much, but that could mean a lot of money over time for the nation’s retirees.
The cost of FHA loans is going up
Loans from the Federal Housing Authority are a staple for first time homebuyers due to lower down payment requirements and favorable rates. One of the downsides of the FHA loan is the “mortgage insurance” the borrower has to pay to protect the bank from default. Typically, the borrower can get rid of the mortgage insurance after paying the loan down to roughly 80 percent loan-to-value or after a certain number of years. For loans taken out on or after June 3rd of this year, that mortgage insurance payment becomes permanent. Those looking to buy now need to take that into consideration.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTInsuring your valuables
Of all the issues homeowners can have with their home insurance, the failure to insure valuables, antiques and collectibles is one of the most common. A basic policy limits the coverage for your more valuable items such as jewelry, silverware, and musical instruments. Consider getting an appraisal done and have them scheduled individually on your homeowners’ policy. If you happen to have a 1986 Topps baseball card collection, don’t fret. Thanks to the steroids era, it’s worth about twenty bucks.
The Bitcoin digital currency
“Bitcoin” has emerged as a popular, yet highly volatile, alternative currency system. The virtual currency, “mined” by computers, does allow people to buy and sell goods and services (which may or may not be legal) or cash in on various exchanges for real dollars. This year, apparently in response to the European debt crisis, the Bitcoin’s value spiked from $13 to over $200. Earlier this month, the market suffered a huge correction when the exchanges were attacked. If nothing else, it offers an interesting peek into a system with finite currency held outside of a central government influence.
Dan Forbes is a regular contributor on financial issues. He is a CFP Board Ambassador. He leads the firm Forbes Financial Planning, Inc in Providence, RI and can be reached at [email protected].
Related Articles
- Friday Financial Five – March 22th, 2013
- Friday Financial Five – March 15th, 2013
- Friday Financial Five – March 8th, 2013
- Friday Financial Five – March 1st, 2013
- Friday Financial Five – February 22nd, 2013
- Friday Financial Five – February 15th, 2013
- Friday Financial Five—April 12th, 2013
- Friday Financial Five – February 1st, 2013
- Friday Financial Five—April 5th, 2013
