Blog Archives

First Evidence of Obamacare (ACA) Costs Being Passed on to Consumers

2/28/2014

I can make a firm pledge, under my plan, no family making less than $250,000 a year will see any form of tax increase. Not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes.” – Barack Obama

We remember this famous pledge from President Obama. Unfortunately, it will not end up being true. This will effect all of us. A 1% increase in the cost of food/dining out adds up over time. Check out this video from Local 6 in Orlando.

Hopefully this is not a trend that will continue. As you saw in the video, some of the Gator's Dockside locations are not adding the ACA surcharge. However, I am not that hopeful.

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Are There Any Good Reasons To Raise the Minimum Wage?

2/26/2014

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Credit: Dambreaker.files.wordpress.com

In the interest of fairness, I will examine the (possibly) good reasons to raise the minimum wage. I think we would all agree that helping people rise out of poverty is a virtuous thing. So...please make sure your tray tables are in their full upright position and away we go!

CLAIM

A higher Minimum Wage will reduce the number of people in poverty.

If we accounted for inflation...the minimum wage would be at $10.10

The following is a quote from president Obama. "I’m going to keep pushing until we get a higher minimum wage for hardworking Americans across the entire country. It will be good for our economy. It will be good for our families,"

Credit: Streethypenewspaper.com

RESULT

According to therecent report from the CBO, only 19 percent of the benefits of this increase will go to households in poverty.

Actually, not really. If the wage had risen along the years so would have other PRICES, a wage is a price. The subsequent rise in prices as a whole would trigger inflationary pressure and this would have caused a contraction in the job market.

It is true that if you put more money in the pockets of low-income workers, they tend to spend it. However, According to the CBO, and as we said in ourearlier post, this will also cost jobs. Between the job loss and inflationary pressure this increase will cause, the benefit to the economy would be negligible.

Quite frankly, the breakdown of the family structure is what causes the need for low skilled workers to have their pay artificially raised. What would be good for families, would be if we had more jobs. Michael Strain puts it this
way: “Hundreds of thousands of low-skill workers are trying to
find a job but can’t. Is it really the right time to raise the cost of hiring
and make it harder for businesses to hire them?

Overall, what little bit of good is done by the increase in minimum wage, is overshadowed by the unintended consequences. According to Jeffery Dorfman, "If the aim is to redistribute income without people noticing because the government role in the process is once removed, raising the minimum wage might be a good choice. However, if the goal is to help workers in or near poverty to earn a better living, the policy fails due to its poor focus and extraordinary cost relative to the reduction in poverty. We can do better by poor workers than this."

Please feel free to chime in with your own opinions below

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Whatever Happened To Personal Responsibility?

2/22/2014

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Image Credit: Shilohlogan.com

Do we hold others accountable for our shortcomings? As a teacher I have often heard that a particular student may learn better if I taught him/her better. This is quite possibly true and it is why I strive to not only impart the necessary knowledge but also inspire my students to do more. A recent article from Sammiches and Psych Meds speaks to this point. The author states that "students need a teacher who is equipped to see why curriculum is relevant and how to apply it to their daily lives and futures". Click on the link above to see the entire article, as it is very good.

A recent conversation I was having on Marketwatch.com about the city employees in Detroit having their pensions cut, inspired this post.

It is, ultimately, the responsibility of the individual to ensure the outcome they are striving for occurs. That is, do not rely on others to subsidize your expectations. I believe it to be a very unfortunate thing that people are losing pensions or seeing the balances in their 401k's dwindle due to bad decision making. However, isn't this something that we should prepare for? Isn't the possibility of misfortune, however slight, something that should be in the review of our minds eye?

So...If I am striving to do my best for myself and those around me by going above and beyond, doesn't it hold true that others should as well? I believe that if we all increased our levels of responsibility, then collectively the world would be a better place. Instead of doing for others...first do for yourself. If I am responsible enough to "do for myself" and to "take care of myself" then the good from that will spill over towards those around me. This rationale can also be applied to the current debate on raising the minimum wage. As a society we want to have compassion for those around us. This need for compassion leads us to raise the minimum wage, thereby causing other jobs to be lost. However, If we encouraged people who are making minimum wage to increase and improve their skillset, they would have the ability to move on to better paying jobs without negative consequences to those around them.

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Save Money! Make you favorite restaurant meals at home

2/20/2014

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You can't help it! You want to stop spending money, you want to start saving more, but the food at your favorite restaurant is just too good! Well, problem solved, check out the link below to a cookbook that has all the recipes from your favorite restaurants.

Click Here!

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(MORE) Reasons not to raise the minimum wage

2/18/2014

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Photo credit: Blog.Mlive.com

Well here we go again. The CBO, (Congressional Budget Office), came out with a report that says raising the Federal Minimum Wage to $10.10 an hour would lift 900,000 people out of poverty. Awesome! Less poor people! Well, there is one problem. There are 45 million people that will be below the poverty line this year so this is barely a 2% decrease in the amount of people in poverty. Why not do it you ask? Because that same report says raising the minimum wage to $10.10 an hour would cost 500,000 jobs!. That means there will not be as many people available to pay for the goods these minimum wage workers are producing.

We had an earlier post that explained in detail how raising the minimum wage would cost jobs

We would love to hear your comments on this! Make sure you respond below

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The High Cost of Bad Credit

2/13/2014

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As a teacher, I expect to see students who struggle with the concept of credit and how it works. The funny thing is, I saw it all the time with people in their 30's, 40's and 50's when I was a financial planner. The concept should be simple....do no spend money you do not have. But we Americans love ourselves some free stuff. How many times have I heard, "I didn't have the money" or "times were tough", so we put it on credit. That is the one way that teenagers and poor money managers are the same, they are both full of excuses

I have put together the many ways in which the average person spends way too much money every year, just because they have poor credit.

Early on, when we are young, we have something known as juvenile credit. No, I am not referencing teenage boys buying water ballons and toilet paper for a night of highjinks, but rather the fact they having no credit history can be just as much of a problem as a bad credit history. No one wants to sell a car or rent an apartment to someone they can't trust, and that is what our credit history tells people. Can I trust this person?

The high price of bad credit is way more than a few $30.00 late fees. The following list highlights the various ways a poor credit score can cost you, literally.

Inability to Open a Checking Account: if you don't have a checking account, you cannot pay bills by check or online. You will have to waste time, (you could be working) to go to the various locations to pay your bill in cash.

Using Check Cashing Services: Not only do many of these services charge a hefty fee, (Walmart is the cheapest, places like Check-n-go are way expensive), but now you are walking around with tons of cash that you are more likely to spend on things you do not need.

No Zero Percent for You!: Not only will you not be able to get the "special" deals you see on T.V., you will actually have to pay much higher rates for car loans and home loans. If you can even qualify!

Not Hiring: Having worked in the retail banking industry, I speak from experience. We performed credit checks on every employee and if you had below average credit we would not hire you. This rule also applies to any other company where you handle money or are what is known as a fiduciary. A fiduciary is someone like a financial planner who is in charge/control of large sums of money. (ThinkBernie Madoff)

The above reasons could possibly cost you thousands every year. This is the difference between getting ahead and just getting by.