Pennsylvania Becomes Ninth State to Move Away from Pensions for Public Workers

Recently, Pennsylvania Governor Tom Wolf signed a bill making the Keystone State the ninth to replace the traditional pension system for state employees with a “hybrid” retirement account that combines a pension structure and 401(k)-style plan.

The new law marks a continuing shift away from the burdensome, pension-based retirement systems for public employees threatening to drive states and municipalities into bankruptcy.

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Taking effect in January 2019, the Pennsylvania law will vastly reduce the burden of state taxpayers presently obligated to collectively serve as the guarantor of the pension benefits for public employees.

As reported by CNN Money, Pennsylvania joins Rhode Island, Virginia, Tennessee, and Georgia in creating a multi-faceted structure wherein state workers contribute to one plan, similar to a traditional pension, that will provide a guaranteed payout at retirement, and to a second that’s similar to a 401(k), which employees can carry with them if they happen to move on from working for the state. States that have implemented the plans will continue to make contributions on behalf of their employees, but the total obligation will be greatly reduced.

In a statement, Gov. Wolf bottom-lined the importance of the reform measure, saying, “Let’s be clear: This plan addresses our liability in the only real and responsible way possible, by changing the structure of pension benefits.” Pennsylvania’s pension fund, which was running a $20 billion surplus in 2000, posted a $70 billion deficit in 2015, according to CNN Money.

Those hired for high-risk jobs in Pennsylvania, like police officers, will remain, at least for now, in the traditional pension system. All other new hires, such as teachers, will be moved into the new system.

As with so many other states, Pennsylvania found its pension structure in particular jeopardy after the 2008 economic collapse. Additionally, commitments made to significant benefit increases, including some that are retroactive, helped put Pennsylvania’s system, as well as the systems of so many other states, at grave risk of default.

The information contained here is for general information purposes only. The Financial Writer blog and Bob Yetman disclaim responsibility for any liability or loss incurred as a consequence of the use or application, either directly or indirectly, of any information presented herein. Nothing contained in this article, or any other article featured at this blog, should be construed as a solicitation or recommendation to engage in any financial transaction. You should seek the advice of a qualified professional before making any changes to your personal financial profile.

Study: Cell Phone Bill Could Prove to Be One Key to Accessing Consumer Credit

Imagine if the fact you reliably pay your cell phone bill each month turned out to be the basis on which you come to enjoy access to substantial credit at competitive rates.

It could happen.

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According to USA Today, the findings of a study conducted by ID Analytics LLC, a developer of consumer risk management software for businesses, suggest that evaluating cell phone and utilities payment histories can be just as reliable a predictor of credit risk as the payment histories associated with credit card bills, mortgages, auto loans, and student loans.

“This is a win-win for lenders and consumers, especially young adults and other populations that have historically been marginalized by traditional scoring models,” said Ajay Nigam, an ID Analytics senior vice president, in a written statement.

Equifax, Experian, and TransUnion, the nation’s three principal nationwide credit reporting agencies, evaluate credit histories by looking at more robust kinds of accounts, like mortgages and car loans, but a lot of people, primarily young adults and low-income folks, are often unable to access meaningful credit because they’ve never had any such financial products in their names. This deficiency tends to leave them unable to access “regular” credit at a competitive rate.

However, ID Analytics uncovered something interesting: 70 percent to 90 percent of credit applicants who either have no credit history or very little credit history…do have accounts with telecommunications companies by virtue of having cell phones.

More importantly, in its look at the portfolio of a popular credit card issuer, ID Analytics found that roughly half of the people denied a credit card by that company for having no credit score would have been eligible for the plastic if cell phone bill payment histories, as well as other, “alternative” payment histories, were utilized as a part of the underwriting process.

The information contained here is for general information purposes only. The Financial Writer blog and Bob Yetman disclaim responsibility for any liability or loss incurred as a consequence of the use or application, either directly or indirectly, of any information presented herein. Nothing contained in this article, or any other article featured at this blog, should be construed as a solicitation or recommendation to engage in any financial transaction. You should seek the advice of a qualified professional before making any changes to your personal financial profile.

Shark Tank’s Daymond John on Working to Make It Big as an Entrepreneur: “Don’t Quit Your Day Job”

For those of you who are bent on achieving entrepreneurial success, but cannot bring yourselves to quit your day job and throw everything you have into your dream effort, side hustle, or whatever you want to call it…Shark Tank’s Daymond John understands, and has your back.

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As a matter of fact, he thinks it’s a bad idea for anyone building a business on the side to leave behind the source of income that’s paying the bills right now.

According to John, the notion that one must quit a reliable, “regular” job to ultimately become successful as an entrepreneur “is garbage,” according to the mega-successful founder of the FUBU clothing line.

And he speaks from personal experience.

During an appearance last week at CNBC’s iConic conference in New York City, John said, “I was working at Red Lobster for five years as a waiter as I was running this business.” From there, he recalled that “it was 40 hours at Red Lobster and six hours at FUBU. Then it was 30 hours at Red Lobster and 20 hours at FUBU, because money started to come in.”

Importantly, John said that even as his business started to gain traction, he kept his restaurant job.

Why?

“If it would have failed, I still wouldn’t have been owing everybody; I wouldn’t have had this huge deficit; my credit wouldn’t have been ruined for seven years.”

In other words, John says to keep your day job until it is positively clear that you don’t need it any longer.

So how do you stay the course in burning the candle at both ends? The old-fashioned way, says John.

“Work. Bust your butt. Get up before everybody, go to sleep after everybody, and bust your butt. That’s it.”

The information contained here is for general information purposes only. The Financial Writer blog and Bob Yetman disclaim responsibility for any liability or loss incurred as a consequence of the use or application, either directly or indirectly, of any information presented herein. Nothing contained in this article, or any other article featured at this blog, should be construed as a solicitation or recommendation to engage in any financial transaction. You should seek the advice of a qualified professional before making any changes to your personal financial profile.

Survey: 1 in 4 Americans Skips Doctor Because of the High Cost

You probably expect people to do it; you might even be one of them. It turns out, according to a new Bankrate.com study, that a large number of Americans – 25 percent of them – are passing on going to the doctor because they can’t afford it.

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Speaking to Fox Business about the disturbing survey results, Bankrate.com analyst Robin Saks Frankel said, “I found it concerning that so many people skip medical care because they are afraid of what the cost of treatment could be. Not all aches and pains can be easily dismissed and the future costs could end up being higher for someone if a condition is left untreated. To have health insurance and yet still have fears about treatment fees just seems wrong.”

No argument there.

According to the survey, older millennials, those in the age 27 to 36 age bracket, are most likely to skip the doctor because of cost fears – a whopping 32 percent of them don’t go to the doctor, presently. Frankel said that millennials are the biggest group of healthcare dropouts because of the enormous amount of student debt with which they’re burdened.

Historically, perceived invincibility has been a factor in keeping younger adults from going to the doctor, but now, the issue of expense is making that avoidance problem much worse.

To be sure, it is not just millennials forgoing health care services; 25 percent of America is a much larger chunk than which is represented by the older millennial demographic. The reality is that access to health care is presently out of reach, by virtue of high cost, to a great many Americans, and while there has not been a lot of talk on the national level as to how that inaccessibility is affecting mortality, make no mistake: if nothing changes, there will be plenty of conversation on that point, very soon.

The information contained here is for general information purposes only. The Financial Writer blog and Bob Yetman disclaim responsibility for any liability or loss incurred as a consequence of the use or application, either directly or indirectly, of any information presented herein. Nothing contained in this article, or any other article featured at this blog, should be construed as a solicitation or recommendation to engage in any financial transaction. You should seek the advice of a qualified professional before making any changes to your personal financial profile.

Alabama Town Demands Teenagers Get Business Licenses in Order to Mow Lawns

Summer jobs for teens just aren’t what they used to be in these United States.

It seems that one city in Alabama has decided that local kids who want to mow lawns as a way of making a few bucks can only do so legally if they get business licenses.

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In Gardendale, as in municipalities all across the country, local laws require that those who choose to run some kind of an enterprise must have a business license.

Nothing shocking about that, in general; even some of the most ardent anti-government types have no problem with cities and towns requiring business licenses.

What is surprising is that Gardendale is going to the extent of demanding that local kids who want to cut neighbors’ lawns for a few bucks – an activity once seen as a rite of passage for teens in America – will need to secure a business license.

It appears that local lawn care companies in Gardendale are partly behind the city government’s push to crack down on kids who cut grass without the proper credentials, according to WBMA.

Resident Elton Campbell has a granddaughter who mows the lawns of her neighbors.

“One of the men that cuts several yards made a remark to one of our neighbors that ‘if he saw her cutting grass again that he was going to call Gardendale’ because she didn’t have a business license,” said Campbell.

Adding insult to injury is the cost of the license – $110. For many young kids doing lawns here and there for summer work, that’s a whole lot of money.

Gardendale’s mayor, Stan Hogeland, says that while everyone running a business within city limits must have a license, that mandate is not intended to apply to kids cutting lawns for neighbors.

“I would love to have something on our books that gave a more favorable response to that student out there cutting grass,” said Hogeland. “And see if there’s maybe a temporary license during the summer months that targets teenagers.”

For now, though, kids in Gardendale had better pony up that $110…or else.

The information contained here is for general information purposes only. The Financial Writer blog and Bob Yetman disclaim responsibility for any liability or loss incurred as a consequence of the use or application, either directly or indirectly, of any information presented herein. Nothing contained in this article, or any other article featured at this blog, should be construed as a solicitation or recommendation to engage in any financial transaction. You should seek the advice of a qualified professional before making any changes to your personal financial profile.

Judge Hands 35 Years to First American Convicted of Trying to Join ISIS

Did you happen to see this?

A U.S. citizen convicted of trying to join the Islamic State did not get off easy.

Back on May 31, a federal judge sentenced the first American ever convicted of trying to wage jihad on behalf of ISIS to 35 years in prison.

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From a statement issued by the Department of Justice:

“Today, Tairod Nathan Webster Pugh, a U.S. citizen and former member of the U.S. Air Force, was sentenced to 35 years in prison for attempting to provide material support to the Islamic State of Iraq and Syria (ISIS), a designated foreign terrorist organization, and obstruction of justice.”

As reported by the New York Post, Pugh, ostensibly a big, tough jihadist, was in tears during his sentencing by U.S. District Judge Nicholas Garaufis. Addressing the judge, Pugh said, “I am a black man, I am a military man, I am a Muslim man. I protected this country and the Constitution. And my service was repaid by stripping me of my career, shaming my wife, shaming my parents, shaming my children.”

If Pugh was seeking sympathy from Garaufis, it was not forthcoming.

“This isn’t about whether you’re Muslim or Christian or Jewish,” said the judge to the defendant before handing down his decision. “This is about whether you’re going to stand up for your country, which has done so much for you, or betray your country.”

“You made your choice,” proclaimed the judge. “I have no sympathy.”

Boom.

The information contained here is for general information purposes only. The Financial Writer blog and Bob Yetman disclaim responsibility for any liability or loss incurred as a consequence of the use or application, either directly or indirectly, of any information presented herein. Nothing contained in this article, or any other article featured at this blog, should be construed as a solicitation or recommendation to engage in any financial transaction. You should seek the advice of a qualified professional before making any changes to your personal financial profile.

SBA Administrator Says Volume of Government Regulations Is Devastating Small Businesses

Have you tried to start a small business in America recently?

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Depending on the size and nature of your concern, you may be out of compliance with a host of local, state, and federal regulations and not even know it. There are large numbers of people, all across the country, who innocently start working at very small, almost-entirely self-contained enterprises, and later find themselves at odds with regulators eager to fine and sanction them for any of a whole host of violations, many of them very minor and technical in nature.

So is there any real help forthcoming?

Very possibly. Linda McMahon, wife of professional wrestling impresario Vince McMahon and new administrator of the U.S. Small Business Administration (SBA), seems genuinely concerned about the fact that the present regulatory environment in the nation is suffocating small business. On Monday, McMahon rightly noted that even more than any one regulation, it is the mountain of rules and laws facing small business that prompt many budding entrepreneurs to decide that going into business just isn’t worth the hassle.

“It is not necessarily any particular regulation as much as it is the volume of regulations,” McMahon said Monday as a guest on Fox Business’ After the Bell. “And the cost of compliance and the time for compliance—everything is just way too complex than what it needs to be.”

Still, while it is a good sign that the Trump administration – including, and especially, the SBA’s administrator – recognize that small business owners are drowning in regulations, that awareness is of no value if material change is not implemented.

Here’s hoping the right thing is done, for the sake of all of those who keep America’s economic engine running.

The information contained here is for general information purposes only. The Financial Writer blog and Bob Yetman disclaim responsibility for any liability or loss incurred as a consequence of the use or application, either directly or indirectly, of any information presented herein. Nothing contained in this article, or any other article featured at this blog, should be construed as a solicitation or recommendation to engage in any financial transaction. You should seek the advice of a qualified professional before making any changes to your personal financial profile.

Study: Valedictorians Rarely Enjoy Wild Success, While the Average Millionaire’s College GPA is 2.9

If you believe your fair-to-middlin’ performance in school is a sign that you’ll never be a roaring success, you might want to think again.

It turns out that while valedictorians and salutatorians typically do quite well in adulthood, thank you very much, the average college GPA of millionaires is just 2.9, equivalent to a B-minus.

So, what gives?

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According to Eric Barker, author of Barking Up the Wrong Tree: The Surprising Science Behind Why Everything You Know About Success Is (Mostly) Wrong, the inherent nature and structure of formal education has a tendency to reward the kind of behavior that makes for a good student, but does not so great a job of validating the dynamic traits of which millionaires are so frequently and naturally possessed.

Barker notes that “schools reward students who consistently do what they are told,” but it’s typically the case that those who often make a significant impact somewhere along the line have a record of shaking things up, and thinking unconventionally.

Additionally, says Barker, “schools reward being a generalist,” while society seems to do a better job at handing over its strongest, “real world” accolades to those who singularly devote themselves to a particular passion, and take it further than anyone who has come before.

Addressing his assessments with Business Insider, Barker said, in part: “Valedictorians often go on to be the people who support the system — they become a part of the system — but they don’t change the system or overthrow the system.”

The information contained here is for general information purposes only. The Financial Writer blog and Bob Yetman disclaim responsibility for any liability or loss incurred as a consequence of the use or application, either directly or indirectly, of any information presented herein. Nothing contained in this article, or any other article featured at this blog, should be construed as a solicitation or recommendation to engage in any financial transaction. You should seek the advice of a qualified professional before making any changes to your personal financial profile.

Robot Preacher Beams Lights from Its Hands, Gives Automated Blessings

It was just a matter of time.

According to the Daily Mail Online, there’s a new preacher in town, and this one is likely very different from the faith leader you see each Sunday morning at your local house of worship.

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This preacher is neither male nor female…because this preacher is not even human.

This preacher is a robot – a robot that answers to the name “BlessU-2.”

BlessU-2, presently on display in Wittenberg, Germany, is programmed to dole out blessings in a variety of languages, and beam lights from its hands.

As described by the Daily Mail, the robot first welcomes a user, and then asks if they would prefer to be blessed by a male or female voice. Next, the user is asked to choose a blessing, and once they’ve made a selection, the robot raises its arms upward and smiles. Lights begin to flash in the mechanical preacher’s arms, at which point it says, “God bless and protect you,” and then recites verse from the Bible. Once finished, the user has the option to print the blessing from the robot.

According to Sebastian von Gehren, spokesman for the evangelical church presently featuring the robot, “It is an experiment that is supposed to inspire discussion.”

However, Von Gehren added, “The machine should not replace the blessing of a pastor. In the future there will not be a blessing robot in every church.”

Perhaps if the designers want to achieve something TRULY lifelike, they could program the robot preacher to request that users send it their life savings.

Just kidding.

Have a blessed day.

The information contained here is for general information purposes only. The Financial Writer blog and Bob Yetman disclaim responsibility for any liability or loss incurred as a consequence of the use or application, either directly or indirectly, of any information presented herein. Nothing contained in this article, or any other article featured at this blog, should be construed as a solicitation or recommendation to engage in any financial transaction. You should seek the advice of a qualified professional before making any changes to your personal financial profile.

 

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