Latest news with #wealthy
Yahoo
13 hours ago
- Business
- Yahoo
Contributor: Social Security is headed for a cliff. When will voters care?
Considering recent news, you may have missed that the 2025 trustees reports for Social Security and Medicare are out. Once again, they confirm what we've known for decades: Both programs are barreling straight toward insolvency. The Social Security retirement trust fund and Medicare Hospital Insurance trust fund are each on pace to run dry by 2033. When that happens, seniors will face an automatic 23% cut in their Social Security benefits. Medicare will reduce payments to hospitals by 11%. These cuts are not theoretical. They're baked into the law. If nothing changes, they will be made. I have nothing against cuts of this size. In fact, if it were up to me, I would cut deeper. Medicare is a terrible source of distortions for our convoluted healthcare market and needs to be reined in. Social Security was created back when being too old to work meant being poor. That's no longer the case for as many people. Thanks to decades of compound investment growth, widespread homeownership and rising asset values, seniors are no longer the systematically vulnerable group they once were. The top income quintile includes a growing number of retirees who draw substantial incomes from pensions and investment portfolios with Social Security benefits layered on top. These programs have become a transfer of wealth from the relatively poor to the relatively wealthy and old. Of course, America still has some poor seniors, so cutting across the board is bad. This is why the cuts should be targeted, not the automatic effects in 2033. And Congress should get started now. The size of the problem is staggering. Social Security's shortfall now equals 3.82% of taxable payroll or roughly 22% of scheduled benefit obligations. Avoiding insolvency eight years from now would require an immediate 27% benefit cut, according to former Social Security and Medicare trustee Charles Blahous. Alternatively, legislators could raise the payroll tax from 12.4% to 16.05%. That's a 29.4% increase. Or they could restructure Social Security so that only people who need the money would receive payments. But because facing this problem in an honest way is politically toxic, legislators are ignoring it. Blame does not rest solely with Congress. The American public has made it abundantly clear that they don't want reforms. They don't want benefit cuts or tax increases, and they certainly don't want higher retirement ages. So politicians pretend everything is fine. Congress does deserve fresh criticism for making things worse. Last year, legislators passed the misnamed 'Social Security Fairness Act,' giving windfall benefits to government workers who didn't pay into the system — which enlarges the shortfall. This year, the House proposed expanded tax breaks for seniors in the 'One Big Beautiful Bill Act,' which would further worsen the problem. The cost of political giveaways is steep. Social Security's 75-year unfunded obligation has now reached $28 trillion, up from $25 trillion just a year ago. Medicare is no better. Its costs are projected to rise from 3.8% of gross domestic product today to 6.7% by the end of the century (8.8% under more realistic assumptions). Most of the additional spending will be financed through general revenue, meaning more borrowing and more pressure on the federal budget. As Romina Boccia of the Cato Institute has documented, other countries have taken meaningful steps to address similar challenges. Sweden and Germany implemented automatic stabilizers that slow benefit growth or raise taxes when their systems become unsustainable. New Zealand and Canada have moved toward more modest, poverty-focused pension systems that offer basic support without bankrupting the state. A few weeks ago, Denmark increased the retirement age to 70. These are serious reforms. The U.S. has done nothing. Options exist. Policymakers could gradually raise the retirement age to reflect modern, healthier, longer lives. They could cap benefits at $2,050 monthly, preserving income for the bottom 50% of beneficiaries while progressively reducing benefits for the top half. They could reform the tax treatment of retirement income to encourage private savings, as Canada has done with its tax-free savings accounts. Any combination of these reforms would help. But that would require admitting that the current path is unsustainable. It would require telling voters the truth. It would require courage. So far, these admirable traits have been sorely lacking in our politicians. The programs' trustees have made the stakes clear: The only alternatives to reform will be drastic benefit cuts or massive tax hikes. Waiting until the trust funds are empty will leave no room for gradual, targeted solutions. It will force crisis-mode slashing that will hurt the most vulnerable. The ultimate blame is with voters who continue to reward politicians for promising the impossible. A functioning democracy cannot survive if the electorate insists on voting benefits for themselves to the point of insolvency. At some point, reality asserts itself. That moment is rapidly approaching. Veronique de Rugy is a senior research fellow at the Mercatus Center at George Mason University. This article was produced in collaboration with Creators Syndicate. If it's in the news right now, the L.A. Times' Opinion section covers it. Sign up for our weekly opinion newsletter. This story originally appeared in Los Angeles Times.
South China Morning Post
2 days ago
- Business
- South China Morning Post
Why are fewer wealthy Chinese likely to emigrate this year?
The number of wealthy mainland Chinese choosing to emigrate is projected to drop to a 10-year low this year thanks to the country's improved business environment and its growing appeal to tech entrepreneurs, according to a report by a London-based advisory firm. Henley & Partners' annual wealth migration report also said that Hong Kong is starting to see steady inflows of millionaire migrants from the rest of Asia, with an anticipated net inflow of 800 this year, including many executives from fast-growing hi-tech companies in neighbouring Shenzhen. A record 142,000 high-net-worth individuals – people with more than US$1 million in investible wealth – are expected to relocate internationally this year, according to the report, which was released on Tuesday. It said the net outflow of mainland Chinese millionaires would drop to 7,800 – down from 15,200 last year and 13,800 in 2023 – ending the country's decade-long run as the world's leading source of wantaway wealthy. The United Kingdom is set to have the largest net outflow of any country, losing 16,500 millionaires this year, the report said. Other European countries such as France, Spain and Germany are likely to be other major sources of outflow, it added. The rise of Chinese tech hubs such as Shenzhen and Hangzhou, alongside rapid growth in the private banking, healthcare and entertainment industries, is giving mainland millionaires new reasons to stay, Henley & Partners said. An emigration consultant and a wealthy Chinese mother said another major reason for the expected reduction in the outflow of mainland millionaires – likely to be the lowest since the Covid-19 pandemic according to the Henley & Partners report – was the growing uncertainty facing Chinese students studying abroad.
Times
4 days ago
- Business
- Times
Headline mews: the historic hidden gems selling like hot cakes
W ith their candy-coloured façades and climbing greenery, mews are tucked-away treasures that are steeped in history. The original residents of these former coach houses were the horses and staff that served the grand homes of the wealthy. But as carriages were replaced by cars, they were gradually converted into desirable abodes. So desirable that the average price of a mews house has increased 434 per cent in the past 30 years. In 1995, you could pick up a typical mews for about £83,500 (which, adjusted for inflation, is the equivalent of £172,020). However, the same property would cost in the region of £446,500 today, according to the estate agency Hamptons. In London, the quintessential heartland of the mews, the average price for one of these hidden gems tipped over the £1 million mark for the first time this year.
Yahoo
5 days ago
- Business
- Yahoo
Rich young Americans are ditching the stock market
Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below. The stock market has long been the go-to choice for people looking to invest their money. But that could be about to change as a younger generation — with a preference for alternative investments outside the shaky stock market — enters the scene. According to a recent survey from Bank of America, individuals aged 21 to 43 with at least $3 million in assets only have 25% of their portfolio invested in stocks — compared to 55% for wealthy investors aged above 43. Most rich, young Americans (93%) say they plan to allocate more of their portfolio to alternatives in the next few years. So, what alternative investments are capturing the interest of these young millionaires? Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how BlackRock CEO Larry Fink has an important message for the next wave of American retirees — here's how he says you can best weather the US retirement crisis Nervous about the stock market in 2025? Find out how you can access this $1B private real estate fund (with as little as $10) The Bank of America survey revealed that among wealthy young investors, 45% own gold as a physical asset, and another 45% are interested in holding it. Historically, gold has served as a hedge against inflation and market volatility. Many investors turn to 'safe haven' assets like gold during economic and geopolitical instability to preserve their wealth. The enthusiasm of investors has indeed propelled the price of gold to record levels with the precious metal recently sitting around the $3,300 per ounce mark as of June 2025. There are lots of gold assets to choose from, including gold bars, coins and gold stocks. One way to invest in gold that also provides significant tax advantages is to open a gold IRA with the help of American Hartford Gold. Gold IRAs allow investors to hold physical gold or gold-related assets within a retirement account — combining the tax advantages of an IRA with the protective benefits of investing in gold, making it an option for those looking to potentially hedge their retirement funds against economic uncertainties. Even better, you can often roll over existing 401(k) or IRA accounts into a gold IRA without tax-related penalties. To learn more, get your free 2025 information guide on investing in precious metals. Qualifying purchases can also receive up to $20,000 in free silver. Real estate has long been considered a solid portfolio hedge, as rent and property values tend to increase with inflation. It's no surprise that high-net-worth individuals — regardless of their age — see opportunity in this asset. In the Bank of America survey, 31% of younger people said real estate presents the greatest opportunities for growth. Federal Reserve data also shows that the top 1% of Americans hold over $6 trillion in real estate assets. For accredited investors, Homeshares gives access to the $36 trillion U.S. home equity market, which has historically been the exclusive playground of institutional investors. With a minimum investment of $25,000, investors can gain direct exposure to hundreds of owner-occupied homes in top U.S. cities through their U.S. Home Equity Fund — without the headaches of buying, owning or managing property. With risk-adjusted internal returns ranging from 14% to 17%, this approach provides an effective, hands-off way to invest in owner-occupied residential properties across regional markets. More than 72% of younger investors (ages 21-43) believe it is no longer possible to achieve above average investment returns by investing solely in traditional stocks and bonds. Art is one of the alternative investments that has captured the attention of smart investors. With over $67 billion in annual transaction volume and a total estimated global value of $1.7 trillion, art represents a massive asset class, according to Deloitte. In fact, fine art has historically outperformed the S&P 500, with contemporary art achieving an annual return of 11.5% from 1995 to 2023, compared to the S&P 500's 9.6% during the same period. In the past, you had to be ultra wealthy to invest in art, considering you needed to have the millions it takes to buy a painting at an auction. But Masterworks has now changed that. This investment platform has made it possible for more investors to access this prized asset. Instead of buying a single painting for millions of dollars, you can now invest in fractional shares of blue-chip paintings by renowned artists including Pablo Picasso, Basquiat and Banksy. All you have to do is select how many shares you want to buy and Masterworks will take care of the rest. Step 1: Accredited investors need to visit where they'll be prompted to enter a few details about their portfolio and investment goals. Step 2: Investors can schedule a call with one of Masterworks Advisers — registered investment representatives — to determine which current art holdings match their investment goals. The benefit is that you can select one or many art pieces, buying fractional shares based on your interests and goals. Step 3: As soon as Masterworks sells a piece you invested in, you get a return from the net proceeds. While every artwork performs differently, overall the past three exits — where Masterworks has acquired, held and eventually sold the art work — delivered median returns of 17.6%, 17.8%, and 21.5%. See important Regulation A disclosures at Read more: Rich, young Americans are ditching the stormy stock market — Private equity refers to investments in companies that are not publicly traded on a stock exchange. This asset class involves investing directly in private companies, often during their growth stages or through buyouts. It remains a popular choice among young investors seeking higher returns and more control over their investments. The Bank of America survey showed that over 25% of young wealthy millionaires identified private equity as one of the greatest growth opportunities. While private equity offers significant upside potential, it also requires a longer-term commitment and comes with higher risks than public equities. Private equity is a broad category that spans a wide range of assets. So, finding a firm that can help you allocate your capital to the right assets, could be a way to dip your toe into this lucrative category. Investors used to be skeptical about cryptocurrency, perhaps due to its speculative and highly volatile nature. But it has now entered the mainstream, and especially with President Trump vowing to create a 'strategic national Bitcoin stockpile', crypto has surged to a global market cap of $3.72 trillion. It's no surprise that the wealthy millennials and Gen Z are fond of this asset class. In the Bank of America survey, 29% of younger people said cryptos offer the greatest opportunities for growth, while only 7% of the older group agreed. Rich young Americans also allocated 15% of their portfolios to crypto, compared to 2% of the older generation. If you're interested in getting in on the crypto game, you can join the club through platforms like Gemini, which allows users to buy, sell and stores bitcoin and 70 other cryptocurrencies. You can place instant, recurring and limit buys on our growing and vetted list of available cryptos. But if you're not ready to buy just yet, you can still invest in crypto with their Gemini credit card. JPMorgan sees gold soaring to $6,000/ounce — use this 1 simple IRA trick to lock in those potential shiny gains (before it's too late) This tiny hot Costco item has skyrocketed 74% in price in under 2 years — but now the retail giant is restricting purchases. Here's how to buy the coveted asset in bulk This is how American car dealers use the '4-square method' to make big profits off you — and how you can ensure you pay a fair price for all your vehicle costs Millions of Americans now sit on a stunning $35 trillion in home equity — here's 1 new way to invest in responsible US homeowners This article provides information only and should not be construed as advice. It is provided without warranty of any kind. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
7 days ago
- Business
- Yahoo
4 Secrets of the Truly Wealthy, According to Dave Ramsey
One of Dave Ramsey's most consistent pieces of financial advice is that wealth-building isn't necessarily tied to how much money you make, but rather how you manage what you have. Many people assume that earning a higher income automatically leads to wealth, but Ramsey points out that a disciplined approach to spending and saving is far more important. Find Out: Read Next: Truly wealthy people live below their means and when they do spend money, they don't advertise it. Essentially, saving consistently is more important than the size of your paycheck or what you splurge on. Known for his no-nonsense approach to personal finance, Ramsey has helped millions of people get out of debt and take control of their financial futures. But what separates those who simply earn a good living from the truly wealthy? According to Ramsey, 'When you quit worrying about what people think and you're actually living life for you and your family — that causes you to make completely different purchases and live a completely different lifestyle.' Here are key principles that truly wealthy people understand and practice consistently. The wealthy don't leave their financial futures to chance. They create a plan, stick to it and regularly review it, which doesn't leave a lot of wiggle room for extravagant purchases like designer clothing. Think about some of the billionaires you see in the news — many aren't dressing like a million bucks even though they have more than a billion bucks. Ramsey would recommend taking baby steps toward building an emergency fund, paying off debt or investing for retirement well before you spend thousands of dollars on pants or shoes. The truly wealthy know where their money is going each month and it's not hanging in their closet. For You: Ramsey is a strong advocate for long-term investing and wealth-building strategies. However, once someone has grown their wealth to be in a place where they are considered rich, they tend not to advertise how much they have or are spending. Some of the most lavish and luxurious expenses can include trips the wealthy take, but the truly wealthy don't let you know about those. Ramsey said, 'They enjoy nice vacations but they seldom post them for you to see on Instagram because they didn't take you on vacation. They wanted to go on vacation.' Generosity is a hallmark of the truly wealthy, and giving often brings even more fulfillment than financial success. However, that doesn't mean they spend everything they can afford to during the holiday season. Ramsey noted, ' The Christmas presents around the tree are very reasonable,' when referring to what the truly wealthy spend on presents. Showing people you care or being generous doesn't necessarily come with an expensive price tag. When it comes to giving to your children, generational wealth may be more the goal than how many presents are under the tree. True wealth comes from a long-term perspective and avoiding debt, which means big expenses such as luxury cars should be avoided when possible. 'The car that they drive is understated and the valet is seldom impressed until he gets the tip. It's usually a used Camry, a nice used Honda or a nice old pickup truck of some kind,' Ramsey said. This long-term perspective includes avoiding debt as much as possible, because, as Ramsey has said, 'Debt is a thief.' The wealthy understand that having a reliable car they don't have to make payments on goes much further down the financial road than other flashier options. The bottom line is that the truly wealthy aren't simply people with high incomes or luxurious lifestyles. They are individuals who consistently practice discipline, intentionality and long-term thinking in their financial lives. They understand that true wealth comes from wise decisions, which means anyone can build lasting wealth and live a financially peaceful life if they put their mind to it. More From GOBankingRates 3 Luxury SUVs That Will Have Massive Price Drops in Summer 2025 How Much Money Is Needed To Be Considered Middle Class in Your State? 6 Popular SUVs That Aren't Worth the Cost -- and 6 Affordable Alternatives This article originally appeared on 4 Secrets of the Truly Wealthy, According to Dave Ramsey Sign in to access your portfolio
