Wealth and Wisdom: Week of June 13, 2022

There’s lots of “breaking news” in your financial world right now – and nearly all of it has to do with the oldest law in economics: supply and demand.

In response to the pandemic, government leaders tried to do something that had never been attempted before – putting our economy on pause – and now nearly two and a half years later we are still dealing with the resulting shortages, surpluses, and quickly shifting consumer demand.

The government and central bankers also flooded the economy with trillions of dollars in new spending – dollars that in many cases didn’t exist before – to keep us out of recession. Their plan worked, but it also sparked the highest inflation we’ve seen in 40 years. The tardy response from a sleepy Federal Reserve means we will be facing higher prices and higher interest rates for some time to come.

We want to keep you aware of these new challenges and help you find ways to cope with them.

An expensive summer to fly

Airfares have jumped 50% – a sign that major carriers are having trouble keeping up with pent-up demand for travel. (Reading time: 2 minutes)

Inflation: This is not the 1970s

Economists and investors believe inflation will peak at a lower rate – and sooner – than during the stagflation days of the 1970s. (Reading time: 4 minutes)

How to save $133 per month

A new study shows consumers are spending an average of $133 each month on subscriptions they don’t use. (Reading time: 2 minutes)

Overstocked shelves mean discounts are coming

Supply-chain bottlenecks drove up prices last year – but the trend is now reversing. (Reading time: 3 minutes)

Is the hot housing market cooling off?

Many believe the inventory of homes for sale has bottomed – which could eventually lead to lower prices. (Reading time: 1 minutes)

Seniors: no Medicare relief this year

Medicare won’t be spending as much on a new Alzheimer’s drug as first thought – but Part B premiums won’t be coming down until 2023. (Reading time: 2 minutes)

Saving Social Security

New projections say Social Security’s trust fund will be exhausted in 2035 – one year later than last year’s estimate. (Reading time: 5 minutes)

Changes to Thrift Savings Plans

If you save for retirement with a TSP, you’ll need to know about some big changes to the program that just took effect. (Reading time: 9 minutes)

High-earners now face higher audit risk

If you earn more than $100,000 a year, the IRS wants you know your odds of getting audited have just doubled. (Reading time: 3 minutes)

Mike’s Pro Tip of the Week

Are you ever tempted by the savings rates you see advertised on the internet – from banks you’ve never heard of? The FDIC’s BankFind search engine will give you the bank’s current insurance status, its history – and other useful information.

Words to the Wise

“Good investing hurts. Investors pay a high price for comfort and get paid a high price for doing what few others will. That will always be the case.”
Morgan Housel

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