The Social Security Administration has tightened security in order to prevent hackers and identity thieves. Now, when you log into your Social Security Administration account, you do what you’ve always done: give your user name and password. Then you receive a security code sent by text message, and type in that code to complete your login procedure. In the cybersecurity trade, this is known as multifactor authentication.
In the wake of the so-called “Brexit” vote in the United Kingdom, and the possibility (though not the certainty) that the U.K. will leave the European Union, you’re likely reading a lot of alarmist stories about the vote’s impact on the U.S. and your portfolio.
Don’t believe half of what you read.
Everybody should have a power of attorney—that is, a legal document that gives a designated individual the right to act on their behalf when making financial decisions. The power of attorney is most often used by adult children to make decisions on behalf of aging parents when they are no longer capable of making sound decisions on their own.
You might be surprised to learn that your pension and IRA assets are protected from fraud, malfeasance and sly predation by an entirely different government agency than your taxable and brokerage accounts. Under the Investment Advisers Act of 1940, the Securities and Exchange Commission polices investment advice and the fairness of recommendations and markets related to taxable accounts. Retirement accounts are policed under the Employee Retirement Income Security Act (ERISA) of 1974, by the U.S. Department of Labor.
The average investor isn’t stupid. The latest evidence comes from a look at where investors are putting their money, taken by the Morningstar mutual fund data organization.
The rule of thumb in financial planning circles is that you shouldn’t spend more than 25% of your income on housing costs. But if you live in certain cities, it might be a tad difficult to follow that rule. Pity New Yorkers, whose rent costs 63.1% of their income. And New York is cheap compared with other locations.
Most people think that the Securities and Exchange Commission (SEC) regulates the investment markets and providers of investment advice, and that the Financial Industry Regulatory Authority (FINRA) regulates the Wall Street sales agents.
But in fact, when it comes to your retirement plan, like a 401(k) account, the chief regulator is actually the United States Department of Labor. Anybody who provides advice to these plans has to meet standards generally defined in the 1975 law known as ERISA (Employee Retirement Income Security Act), which is administered by the Department of Labor.