MONEY MONDAY 6/4/18
Economy added 223,000 jobs last month (188,000 expected)… unemployment rate fell from 3.9% to 3.8%.... And the "U6" number (includes discouraged workers and part-time workers who want to be full-time) fell to 7.6%
The closely watched average hourly earnings metric rose 0.3%, as expected. That translates to an annualized rate of 2.7%. If you put real numbers to this: if you were making $50,000 last year, you (in theory) are making $51,350 this year.
Job gains came from retail (31,000), health care (29,000), construction (25,000), professional and technical services (23,000) and transportation and warehousing, which added 19,000
All this new data means the Federal Reserve is still on track to raise short-term interest in June
The US only gets 3% of its imported steel from China! We actually import MORE steel from TURKEY than from China! We import the most from Canada (19% of total imports)
So, what's a tariff? It is simply a tax placed on some particular class of imported goods. So for example, a company bringing $100,000 of steel made in Canada into the United States would have to pay 25% ($25,000) to the government, effectively increasing its price. Tariffs are typically a governmental tool to protect domestic industries and raise revenue.
But the thing about tariffs? Countries can put their own, retalitory trade measures in place. For example, effective July 1, Canada will impose tariffs of 25% on shipments of U.S. steel and 10% on aluminum, as well as on other products, such as playing cards, inflatable boats and yogurt.
So, if this global trade war keeps growing, YOU are the one that loses in the end… companies hit with tariffs will pass the increase in price along to YOU, the consumer. One estimate shows that the average family will pay $210 more because of tariffs, which eats into your tax reform savings.
HERE'S THE SIMPLY MONEY POINT
It's real simple: A trade war would be really bad news for the economy AND your 401(k).
Every Sunday, Simply Money is answering your money questions in the Cincinnati Enquirer.
Carl in Clermont County: I’m 61 and trying to figure out when to take Social Security. I like the idea of claiming at 62 because I want to get my money as soon as possible. Does this thinking make sense?
And we have a brand new section on our website designed to help educate you as you plan for retirement! You'll find free online video tutorials, live events, and downloadable guides - such as "9 Things Everyone Must Know About Social Security!" Just go to simplymoneyadvisors.com and click on the "Retirement Resources" tab!
Saving for retirement can sometimes feel like an uphill battle, so it's easy to put off saving for another day, thinking you have plenty of time to get started before retirement. And while that might not seem like a big deal, that kind of thinking can cost you thousands (if not hundreds of thousands)! Here are a few other bad habits to nip in the bud before they become major issues.
You don't maintain a budget: Budgeting may not be the most exciting thing in the world, but it's the only way to stay on top of your finances and see how much you really spend each month. If you don't keep a budget, it's hard to know how much you'll need to have saved for retirement. You have to know what's coming in... and what's going out.
Creating a budget will also help you gauge how your finances will change once you retire, so it's important to keep a close eye on how much you're spending now so you're not caught off guard when you're living on a fixed income during retirement.
A good general rule of thumb is the Simply Money 50/30/20 rule: 50% of your take-home pay should go to "needs;" 30% to "wants" and 20% should be saved.
You're putting off saving until you make more: Maybe this is you… or maybe it's your adult kids. Either way, putting off saving for even one year can hurt you in the long term -- even if you save more down the road to try to make up for it.
You borrow from your retirement accounts: When you borrow from your savings, you need to pay that money back with interest (and those interest payments go back into your account). However, some retirement plans don't allow you to make additional contributions while you're repaying your loan, so you have to consider the opportunity cost of not making those extra contributions.
Remember, your retirement accounts should be used for retirement only! They're not a checking account.
HERE'S THE SIMPLY MONEY POINT
Bad money habits can torpedo your retirement if you're not careful!