Several states have pension “millionaire” retirees
A study out of the American Enterprise Institute finds that several states have career workers that will retire with a pension having a net present value of over $1 million. According to the research, the average career public employee will enjoy a replacement income of 87% of final earnings, with employees of 14 states over 90% and 3 states just over 100% (Oregon, California, and Texas). New Mexico shows average replacement incomes of 113%, while West Virginia calculates a 115% replacement income upon retirement. Even better news is retirees don’t have to continue living in West Virginia to collect it.
2015 Health Savings Account details released
Pre-tax contributions to Health Savings Accounts are used to pay the insured’s’ medical expenses, and the maximum allowable contribution will increase next year. The IRS announced new thresholds of $3,350 for individuals and $6,650 for families. For those establishing an HSA account, a healthy measure of due diligence is necessary. Some companies charge a hefty fee up front to set up the account while others will have monthly maintenance or investing fees that can be avoided.
Municipal bonds make a comeback
According to Morningstar, 2013 saw over $58 billion flow out of municipal bond funds. There was a combination of rising interest rates and cities teetering on the brink of bankruptcy. There is always the threat of default, though that rate continues to be historically low. There is also the threat that tax exemption will be limited in some capacity. But the American taxpayer, acknowledging the rising income tax environment, has put roughly $19 billion back into municipals this year and has been rewarded. Through the first quarter, the Barclay’s Municipal Bond Index returned 3.32 percent.
ESOPs, or Employee Stock Option Plans, are traditionally considered larger company plans. For big companies, giving employees a percentage of company ownership creates a sense of participation. Small businesses can also consider these profit-sharing plans as a method of succession. For owners looking to transition out or sell, there may be some sizeable tax benefits to using this strategy, especially if the company is structured as a C-corporation. One drawback of this type of plan might be costly implementation and administration fees.
Some wealthy people buy paintings, others renounce U.S. citizenship
A recent art auction by Christie’s netted over $280 million, with 18 of the works fetching over $5 million. Monet’s painting of water lilies netted a tidy total of $27 million. Picasso’s portrait of Dora Maar was purchased for a “disappointing” $22.6 million. Meanwhile, there is talk of several wealthy people living overseas that will renounce their U.S. citizenship in preparation for the asset disclosure rules that will go in effect in July. Estimates are that the number of expatriates climbed almost fifty percent in the first quarter of 2014 from a year earlier.
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].
5 Businesses Facing Boycotts
Hobby Lobby
Retail Arts and Crafts Stores
Headquarters: Oklahoma City, OK
Local Locations: Warwick, RI; Seekonk, MA; Holyoke, MA; Manchester, NH; East Haven, CT
The company is proud and public regarding its Christian orientation. Founder David Green says "its true owner is God." The national chain of 560 stores are closed Sundays.
There is currently a suit before the U.S. Supreme Court which claims that, as a "tightly held" family business with Evangelical Christian convictions, it should not have to abide by the Affordable Care Act's mandate that it provide two "objectionable" methods of contraception to its female employees.
These methods are emergency contraception (or Plan B) and various intrauterine devices, which Hobby Lobby owners consider "abortifacients."
Chick-fil-A
Fast Food Restaurants
Headquarters: College Park, GA
Local Locations: Burlington, MA; Chicopee, MA, Peabody, MA; Westborough, MA (Pending); Warwick, RI (Pending)
The American fast-food chain known for ads in which cows encourage customers to eat chicken was the focus of controversy following a series of public comments made in June 2012 by chief operating officer Dan Cathy opposing same-sex marriage.
Cathy’s comments went public just after reports that Chick-fil-A's charitable endeavor, the S. Truett Cathy-family-operated WinShape Foundation, had made millions in donations to political groups that oppose LGBT rights. Activists called for protests and boycotts of the chain, while counter-protestors rallied in support by eating at the restaurants.
Boston Mayor Thomas Menino said he would not allow the company to open franchises in the city "unless they open up their policies.” The former Mayor also wrote a letter to Dan Cathy, stating: "We are indeed full of pride for our support of same sex marriage and our work to expand freedom for all people."
In July, 2012. Chick-fil-A released a statement in July 2012 stating, "Going forward, our intent is to leave the policy debate over same-sex marriage to the government and political arena." 2014 tax filings for 2012 showed the group stopped funding all but one of the criticized organizations.
Citgo
Gas Stations
Headquarters: Houston, TX
Local Locations: 14 Rhode Island locations
Many Americans supported boycotts of the company known locally for their iconic Fenway Park sign because they equated it with boycotting Venezuela President Hugo Chávez. Citgo is owned by PDV America, Inc., an indirect wholly owned subsidiary of Petróleos de Venezuela, S.A., the national oil company of Venezuela.
In 2006 at the United Nations, Chávez called George W. Bush the devil and claimed the U.S. president left a sulfur smell around the U.N. speakers’ podium – strong words, even in light of Bush’s declining polling numbers and popularity in America.
The Venezuelan president was famous for anti-American rhetoric. He referred to the United States as “a bad person,” “an assassin,” and “a violent invader.” He speculated about whether the United States was responsible for a spate of cancer diagnoses among Latin American leftists.
WPRO's John DePetro
AM Talk Radio
Headquarters: Providence, RI
This is not the first time Rhode Islanders have boycotted John Depetro and companies that advertise on his program. This time, however, politicians are on board.
In September, DePetro called two female labor activists whores on his WPRO morning radio show. He was fired from a radio station in Boston for calling a gubernatorial candidate a “fat lesbian.” He and WPRO are bieng sued by a WPRO employee for sexual harassment. His wife took blame for a ratings scandal in which someone from his home address faked industry reporting forms.
Labor leader Maureen Martin is the public face of For Our Daughters, the group that is trying to get DePetro off the air. She’s been joined by at least 14 high-level politicians who say they won’t spend their campaign dollars on WPRO until DePetro is off the air. This list includes Governor Lincoln Chafee, Lt. Gov. Elizabeth Roberts, Secretary of State A. Ralph Mollis, Senate President M. Teresa Paiva Weed, Senate Majority Leader Dominick Ruggerio, U.S. Rep. James Langevin and U.S. Sen. Sheldon Whitehouse, Cranston Mayor Allan Fung and State Republican Party Chairman Mark Smiley.
Allston DoubleTree Suites
Hotel
Headquarters: McLean, VA
Workers initiated a boycott of the Harvard-owned DoubleTree Hotel in Allston last month over the process of deciding whether to join UNITE HERE! Local 26, a Massachusetts-based union that represents Harvard’s dining hall employees.
On Thursday, March 27, workers announced the boycott and asked that guests not meet, eat or sleep at the property until they receive respect and dignity at work.
More than 100 workers were joined by Harvard dining services employees, Harvard undergraduate and graduate students and hotel workers from all over the city. The workers have also found support from City Cambridge Councilors Dennis Benzan, Marc McGovern, Leland Cheung, and Nadeem Mazen.
Workers can unionize in two different ways. One involves a National Labor Relations Board election that leads to a union if 50 percent of workers vote for one. The other way, preferred by the protesting DoubleTree workers, allows workers to sign a card at any time that allows a union to be formed.
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