MONEY MONDAY 9/24/18
Topic #1: Tariffs
You've probably been hearing about the tariffs that the US is placing on Chinese products coming into the country… and you've probably been thinking, "What does this mean to me?" Now, we have an idea…
WalMart has just announced that the latest batch of proposed tariffs could make it more expensive for U.S. households to buy items ranging from cribs to Christmas lights.
Walmart joined other industry players in sounding an alarm that American shoppers will suffer the most if another batch of levies is imposed on goods and parts bought from China.
Here's a snippet from the letter sent to the office of the U.S. Trade Representative: "Should the tariffs go into effect, Walmart customers will face cost increases for essential items like car seats, cribs, backpacks, hats, pet products and bicycles.... Either consumers will pay more, suppliers will receive less, retail margins will be lower, or consumers will buy fewer products or forego purchases altogether."
Walmart has often been criticized for stocking its shelves with goods made overseas, particularly in China, in an effort to keep its prices low. But the retailer says that 2/3 of its spending on merchandise sold in the U.S. goes to items that are grown, made or composed of parts produced in America.
And the alarm is sounding even closer to home, as well: P&G is feeling it. Two weeks ago, the company lobbied to have more than a dozen imported goods left off the list of more than $200 billion worth of Chinese products subject to the trade penalty, which takes effect this week. But, no such luck.
P&G has plants across the United States and makes more than 90% of what it sells at home. But like so many other American corporate giants, P&G relies on China for parts and materials to manufacture and package its brands. No one in the United States makes those components.
The company told the White House that it uses Chinese parts and products to produce lines of Crest and Oral-B toothpaste and toothbrushes, Febreze air freshener, Downy and Bounce dryer sheets, Braun electric shavers, Head & Shoulders, Pantene and Olay shampoo, and a vacuum model of Swiffer.
If P&G isn't excluded from the tariffs, production costs will go up. So, either they pass the increase in costs onto YOU the consumer… or they absorb the costs and profits will fall, which is bad news if you're a P&G stockholder.
HERE'S THE SIMPLY MONEY POINT
What started out as a "trade spat" with China has now ballooned into a full-blown trade war. And you're probably going to start feeling the effects, either on your wallet, or in your investments.
Every Sunday, you can find the Simply Money column in The Cincinnati Enquirer and on cincinnati.com
T.R. from Kenton County: How much do I need in my 401(k) to retire? I’m close to $500,000, but not sure if that’s enough.
#3: Relationships and money
If you're married, here's the cold, hard truth that you need to realize: it's highly likely that one of you will become a widow or widower at some point.
Women are more than 3 times as likely as men to lose their spouse, given that women tend to outlive men, and men tend to marry younger women.
Yet there's a big disconnect between both members of a married couple regarding this risk. 53% of all people who've lost a spouse said they didn't have a plan if one of them passed away.
And 76% of married retirees said they wouldn't be financially prepared for retirement if their spouse passed away.
What can you do to reduce the risk and worry that comes with losing a spouse? It's time to 'show each other the love' by planning for this inevitability.
Also, share information! This means knowing how to access your spouse's accounts, and having both names on all accounts and deeds. It also means having the ability to access cash easily… and potentially keeping your credit card debt separate.
This also means, if you work with a financial advisor, BOTH of you should be involved in meetings and discussions.
Find the courage to take steps now to protect your spouse, while both of you are still alive. Then when the inevitable happens, the surviving spouse can focus on healing the emotional disruption without the added stress of worrying about money.
HERE'S THE SIMPLY MONEY POINT
Planning NOW will make a difficult situation down the road a little easier.