Financial News Friday – July 4, 2014

Financial News Friday – July 4, 2014

Happy Independence Day!

Treasury Opens Door For New Annuity Options (Financial Planning)

The IRS and Treasury Department have finalized rules governing longevity annuities. These types of annuities only begin paying out once a retiree reaches age 80 or 85 and last for the remainder of the purchaser’s life. Maximum contributions to such an annuity are capped at 25% of a retirees retirement account. Expect commentary about these in a future post.

One Trick To Make Your Next Flight Better – And Cheaper (MarketWatch)

Do you need to check your bags? This article suggests that you send your bags via Fed Ex or UPS. This trick solves the problem of liquids in your baggage and makes it less likely that you’ll lose your luggage. With many airlines increasing their bag check fees on an annual basis, its likely to be cheaper to ship it via a conventional mail service.

Think College is Out of Reach Now? Just Wait. (Yahoo Finance)

A bill passed last year by Congress that ties student loan rates to 10 Year Treasury Note rates plus a risk premium came into effect on July 1st. Many college students are likely to pay higher rates this year and will continue to pay higher rates when interest rates eventually rise.

Puerto Rico Hits Back (Financial Planning)

Earlier this week Moody’s Investors Service downgraded Puerto Rico’s credit ratings. The US territory’s credit rating has now been decreased even further below investment grade debt. Puerto Rico’s Governor has shot back at Moody’s, saying the downgrade is unfair and has threatened a potential lawsuit against the firm­

Limits To Stretch IRAs Floated To Pay For Highway Repairs (Investment News)

After the recent ruling that removed creditor protection from inherited IRAs, it looks like they are once again in the spotlight. Legislators are once again looking into eliminating the provision that allows inheritors of IRAs to “stretch” an  their required minimum distributions over the remainder of their lifetime. It’s an idea that has been around for the past few years and it looks like it will eventually see action on the floor of Congress, whether it’s with this bill or a future bill. Therefore it may be unwise to count on the stretch provision as part of an estate plan.

Obama Wants More Financial Reform (CNN Money)

President Obama wants to see further regulations placed on banks through greater financial reform.

U.S. Economy Added 288,000 Jobs In June; Unemployment Rate At 6.1% (NY Times)

The official unemployment number has decreased from 7.9% to 6.1%

Photo by Brian Talbot (Flickr)

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