What The Bankers Are Actually Worried About

What The Bankers Are Actually Worried About: Morning Brief

Rick Newman·Senior Columnist  Tue, May 2, 2023

Bankers rule at the annual Milken Institute Global Conference in Beverly Hills, Calif.

So there’s tension in the air as this year’s confab of financiers and business leaders starts on the same day that First Republic Bank fails in a government-backed takeover by JPMorgan Chase.  Just a bit of unpleasant housekeeping, many of the attendees at this year’s conference say.

“No one likes to see a bank fail, but that said, it’s good to see the last remaining source of uncertainty resolved today,” Citibank CEO Jane Fraser told a packed ballroom during the conference’s kickoff session. “We should all feel pleased about that.”

Fraser said the US financial system is “very solid.”

First Republic’s demise follows the failure of two other banks, Silicon Valley and Signature, in March. Is a crisis spreading? Nope. In an interview with Yahoo Finance, Marc Rowan, CEO of Apollo Group (Yahoo Finance’s parent company) said, “the three banks that have failed … totally predictable mark-to-market losses on treasuries, well known structure of the deposit base.” Well-run banks don’t have such problems, he insists.

So everything is fine? Sorry, no.

Americans don’t need to worry about a cascading series of bank failures, but the three failed banks are already setting off a series of repercussions likely to include a sharp cutback in lending that that will slow growth, maybe to a halt.

“The implications are going to be pretty profound,” David Hunt, CEO of asset manager PGIM, said on the kickoff panel. “There’s going to be a real ratcheting up of regulation in the banking system. That will further hinder the supply of credit going into the economy. We are going to see a real slowing of aggregate demand.”

Behind the scenes, more money is flowing out of traditional banks and into other institutions that comprise the "shadow banking" system: private-equity firms, hedge funds, non-traditional lenders and so on. The big, well-known firms aren't showing unusual signs of stress.

But there's a lot of scuttlebutt about mid-market firms that could get squeezed by rising rates and falling asset values, just as those three regional banks did. Shadow banks are less regulated than banks that take customer deposits and offer FDIC insurance. So if there's some kind of crisis, the odds of a government bailout are low. Watch this space.

There’s always a political specter haunting the Milken attendees. This year it’s the debt-ceiling standoff between Republicans who want to slash spending in order to raise the federal borrowing limit, and Democrats who say raise the limit and talk about spending cuts separately.

“We don’t pick up the phone and tell the politicians what to do," Fraser said. "But we do lay out the consequences. This time feels different. It’s more worrying.”

To continue reading, please go to the original article here:

https://www.yahoo.com/finance/news/what-the-bankers-are-actually-worried-about-morning-brief-120016591.html

They’re Taking A Wrecking Ball To The “American Reality”

They’re Taking A Wrecking Ball To The “American Reality”

May 1, 2023  By Simon Black Sovereign Man

Last September-- a bit more than seven months ago-- my father died. Technically he was my step-father, but he was every bit my dad, and I loved him. The loss was hard.  We didn’t do a memorial service right away, though. My mother understandably just wasn’t in the right frame of mind. So we waited… until last weekend, and held the memorial service at the George Bush Presidential Center at Southern Methodist University in Dallas.

It was a good thing my mother booked such a large venue; the memorial service was incredibly well attended, and nearly 500 people came to pay their respects.

https://cdn.sovereignman.com/wp-content/uploads/2023/05/IMG_6804-1152x1536.jpg

After the service was over, I wanted to get my mind off the day’s events, so some friends and I popped upstairs to check out the Bush presidential museum… which was currently presenting an exhibit aptly named “Freedom Matters”.

I couldn’t agree more.

Access to the museum, however, is tightly controlled. And you can only enter after going through an airport-style security checkpoint. You know the drill-- empty your pockets, take off your clothes, and submit to an angry authority who treats you like you’ve just been booked at the county jail.

My friend Jim was lucky enough to receive extra screening; after setting off the metal detector, he was pulled aside and assumed the “I surrender” pose while gruff security personnel waved a magnetic wand near his genitals.

Curiously the security wand kept going off, prompting the increasingly irate guard to demand “what is this? What’s in here?”

I couldn’t help myself and shouted, “It’s his dignity!” Apparently Jim forgot to remove it before going through security.

The irony seemed to be lost on the guards, whose brusque treatment of museum visitors was taking place directly in front of an exhibit literally called “Freedom Matters”.

At the front of the exhibit was a large banner-- I snapped a photo-- defining freedom, according to a former Soviet dissident:

“Can a person walk into the middle of the town square and express his or her views without fear of arrest, imprisonment, or physical harm? If he can, then that person is living in a free society. If not, it’s a fear society.”

I thought about this quote for a few moments, glanced back at the security guards wanding another unlucky visitor, and quickly realized-- based on this definition-- that the US is quickly becoming a fear society.

You can no longer freely express views without fear of reprisal anymore-- especially if those views conflict with the radical woke left.

Personal opinions can easily be viewed as hate speech, misinformation, violence, etc. And we’ve all seen too many instances of people’s lives being ruined by cancel culture. But I’ll come back to this.

After wandering around the museum for a while and enjoying some jokes with my friends, I finally returned home to the AirBnb I’m renting with my family, very close to where I grew up in the Dallas area.

It’s the quintessential American suburb: clean, quiet, safe, and stable. The house where I’m staying is at the end of a picturesque tree-lined cul-de-sac, and on the other end of the street is a large park where small children were playing organized sports in the afternoon.

Parents chatted with each other on the playground while their kids bounced around the jungle gym. Retirees were out walking their dogs. Even the postman drove by and greeted some of the residents by name. Everyone was happy… and it was basically perfect.

This isn’t the famous ‘American Dream’. It’s not a dream. This is real life as it’s supposed to be… the pinnacle of civilization, the product of more than two centuries of hard work and responsibility. It is the American Reality.

That’s why it’s so frustrating to watch the people in charge dismantle it. Brick by brick, neighborhood by neighborhood, they’ve been chipping away at this vast, enviable middle class prosperity, ripping it away in front of our very eyes.

They’ve encouraged “mostly peaceful” violence and caused an alarming rise in crime as a result of their soft “criminal first” policies.

They’ve sent the cost of living to record highs, and yet have no understanding how their spending practices could have possibly contributed to inflation. They’ve expanded the national debt to a record high $31.5 trillion and plan to keep overspending tax revenue by trillions of dollars every year.

They’ve worked hard to re-engineer childhood education (and have succeeded in many school districts). Biology has been rewritten to conform to new woke ethics. Math is racist. And parents who complain about the decline in educational standards are threatened by the federal government.

The most comical part of this suffering is the abject political dysfunction that’s on display every single day of our lives.

Consider that, amid deadly and toxic train derailments, airplanes around the country that have been grounded, total chaos at the national seaports, Transportation Secretary Pete Buttigieg’s priority right now is ensuring that Ford and General Motors use female crash test dummies.

It’s so ridiculous it almost sounds made up. And yet it’s completely true.

Or consider that the Treasury Department is now weeks away from defaulting on the national debt, once again, having reached its statutory debt limit. Congress is required to pass a law to raise the debt ceiling.

Yet the President of the United States refuses to negotiate a single penny in spending cuts in order to reach a compromise with the House of Representatives. Not a penny.

Simultaneously the guy was shown on video recently unable to remember how many grandchildren he has, or even the fact that he had recently returned from a trip to Ireland.

These examples of extreme incompetence never end. It’s so aggravating. Even terrifying.

That’s why I write so much about taking simple, sensible steps to reclaim control.

For example, if you think Pete Buttigieg is doing a great job as Transportation Secretary, then by all means, please continue to overpay your taxes and give him as much of your money as possible.

If, on the other hand, you recognize that he is demonstrably incompetent, completely unqualified to be Transportation Secretary, and was only given the position because he checks a diversity box (and agreed to endorse candidate Biden in 2020) then you might want to consider the multitude of completely legal ways to reduce your tax bill… and stop giving Pete so much money to waste.

It’s perfectly normal to feel angry or disgusted with America’s terrible leadership. But it’s a lot more effective to channel some of that energy into reducing their impact on your life.

There absolutely are ways to reduce your tax bill, to mitigate the effects of inflation, to still make phenomenal investments, to fund your retirement, and to ensure that you’re in a position of strength no matter how destructive they become.

There’s no downside in doing this. If this decline reverses and America starts to dig its way out of this hole, you won’t be worse off for putting yourself in a stronger position.

And that is actually still a possibility. This country has so much potential upside from its entrepreneurial brilliance, talented workforce, immense resource wealth, and more. That’s why it’s so bewildering to see how badly the people in charge are screwing it up.

At the moment, though, it’s difficult to see any real change on the horizon. As President Biden said in his re-election announcement, he wants to “finish the job”. By that I presume he means completely destroying the country.

This is nothing new; history is full of superpowers who eradicate themselves from within. They lay waste to the very ideals that made them strong and prosperous to begin with, they create divisions and disunity, and they subject themselves to horrendous, weak leadership.

But it’s one thing to understand the decline of empires and civilizations through the lens of history. It’s quite another to watch it happen from your living room window.

To your freedom,  Simon Black, Founder  Sovereign Man

https://www.sovereignman.com/trends/theyre-taking-a-wrecking-ball-to-the-american-reality-147087/

7 Income Streams That Make Millionaires Rich

7 Income Streams That Make Millionaires Rich

Andrew Lisa   Mon, May 1, 2023

You can tell a lot about how rich people make their money by looking at their taxes -- which is probably why they work so hard to keep people from nosing around in their returns.

Stay Ahead Of The Market

The IRS gave regular people a glimpse into that insulated world in 2015 when it published the results of a research study titled, "Over the Top: How Tax Returns Show that the Very Rich Are Different from You and Me."

It remains the most comprehensive examination of how rich people get and keep their fortunes. It used estate tax data dating back decades, specifically from Form 706, the United States Estate (and Generation-Skipping Transfer) Tax Return.

If your estate's executor isn't planning to file one of those on your behalf after you die, you probably need to keep saving.

The study's findings revealed seven income streams that millionaires -- and even richer people with real money -- tend to have in common. Are you looking to turn on a new financial faucet in your own life? If you want to get rich, the following various income streams of millionaires are a good place to start.

Capital Gains From Appreciated Assets

Many people face the familiar problem of wanting to buy a giant social media company to assert control over the national dialogue without upsetting their day-to-day cash flow.

Elon Musk faced this very dilemma in when he needed cash on hand in case his now-infamous Twitter deal went through. He solved the problem by selling roughly $7 billion of his Tesla stock, which he exercised the option to buy for pennies on the dollar as part of his compensation package.

While it's not exactly an income stream, millionaires buy and hold appreciating liquid assets like stocks because they can convert them to cash any time they need an infusion of capital.

Dividend Income

Once Elon Musk sold his shares, they were gone forever unless he decided to buy them back.

Dividend stocks, on the other hand, let millionaires have their cake and eat it, too, by making regular payments to their shareholders without requiring them to sell. As the stocks appreciate over time, the dividend payments get bigger. Like the goose that lays the golden egg, dividend stocks are the ultimate passive income stream -- and if you ever need a shot in the arm, you can also sell the goose for a lump-sum windfall.

Interest Payments

To continue reading, please go to the original article here:

https://www.yahoo.com/finance/news/7-income-streams-millionaires-rich-200008107.html

5 Things You Should Never Spend Money on If You Want To Be Rich

I’m a Financial Planning Expert: Here Are 5 Things You Should Never Spend Money on If You Want To Be Rich

Heather Taylor   Mon, May 1, 2023

If you’re not rich, you may wonder how you can get rich at various intervals of your life. Building long-term wealth generally means making smart decisions with your finances like investing consistently and prioritizing paying off any debt.  What it doesn’t include is spending money on stuff that does not have lasting value. How do you know which purchases are preventing you from building wealth? Here’s what one financial planning expert does not recommend spending your money on if you want to be rich.

Luxury Items

This includes designer clothing, expensive watches, vintage cars and any other high-priced status symbol items.

“Buying luxury items you can’t afford can be a significant drain on your finances,” said Ryan Cullen, co-founder and CEO of Cullen Cioffi Capital Management. Cullen recommends concentrating on building your wealth by investing in assets that appreciate in value over time, like stocks or real estate.

Impulse Purchases

Impulse purchases can be lottery tickets or anything you might buy when you’re feeling a bit emotional, like going on a shopping spree after a difficult day at work. These add up over time and can drain your finances. The better approach, Cullen said, is to focus on building a solid financial plan and sticking to it.

Rent

To continue reading, please go to the original article here:

https://finance.yahoo.com/news/m-financial-planning-expert-5-152841032.html

New IRS Rules, Itemized Deductions: Expert Explains Filing Taxes In 2023

New IRS Rules, Itemized Deductions: Expert Explains Filing Taxes In 2023

Bethan Moorcraft    Sat, April 29, 2023

'Unwarranted and unfair': The IRS is now watching how much you make selling any items online — how even casual sellers could get dinged by the new tax rules

A battle has been brewing between e-commerce giants and the Internal Revenue Service (IRS) — and once again, millions of Americans are stuck in the middle. Online shopping giants like Etsy, eBay and StubHub — and the third-party payment networks they use, including PayPal, Square and CashApp — have called on Congress to give relief to millions of online sellers by raising the income reporting threshold on IRS form 1099-K.

The American Rescue Plan of 2021 lowered the 1099-K reporting threshold from $20,000 over 200 transactions to just $600 from any number of transactions, effective January 1.

Nearly 40% of Americans sold items online early in the pandemic, netting about $1,800 on average, according to a MoneyMagnify survey. For those who continue to sell goods on sites like Poshmark, Facebook Marketplace or Etsy to make some extra cash, here’s what you need to know about the new tax rules.

What is the new rule?

The American Rescue Plan of 2021 requires third-party settlement organizations and credit card companies — including payment apps — to report payments for goods and services if they exceed $600 per year.

What that means is if you sell handmade jewelry, art or home décor on Etsy and your transactions total $600 or more in 2023, Etsy will send you a 1099-K form that you should use to report your income to the IRS.

The same rule applies if you sell any personal items online like a car, refrigerator, furniture, stereo or even clothes — and your transactions for the year add up to $600 or more.

To continue reading, please go to the original article here:

'Unwarranted and unfair': The IRS is now watching how much you make selling any items online — how even casual sellers could get dinged by the new tax rules

What To Know If You Deposit More Than $10K Into Your Checking Account

What To Know If You Deposit More Than $10K Into Your Checking Account

Angela Mae  Mon, May 1, 2023

If you plan to deposit $10,000 or more into your checking account, there are a few things you should consider first. By law, banks have to report deposits that exceed a certain amount.  Not only that, but many bank accounts come with maximum deposit restrictions. You may also be subject to certain fees when making such a large deposit. If you frequently make large deposits, you should also watch out for any potential scams or fraudulent activity. But even if this is a one-time thing, it’s still important to know about these factors and how they might affect you.

Banks Must Report Large Deposits

“According to the Bank Secrecy Act, banks are required to file Currency Transaction Reports (CTR) for any cash deposits over $10,000,” said Lyle Solomon, principal attorney at Oak View Law Group. CTRs typically include the name of the individual, their account number, Social Security number and taxpayer identification number — all of which are verified and recorded by the bank.

Banks must file CTRs to the Financial Crimes Enforcement Network (FinCEN), which is part of the U.S. Department of the Treasury. Some banks will do this manually, while others will automate the process.

“The creation of a CTR does not mean that your account will be frozen, nor that the Men in Black will be visiting your home,” said Herman (Tommy) Thompson Jr., CFP, ChSNC, ChFC certified financial planner at Innovative Financial Group. For banks, it’s considered standard procedure and isn’t a cause for concern if the deposit is legitimate.

These procedures exist to help prevent money laundering, counterfeit deposits and similar financial crimes from occurring. By requiring banks to report deposits of $10,000 or more, the government can more easily keep track of monetary transactions. As long as your deposits are legitimate, you won’t have anything to worry about.

Structuring Is Illegal

Some people will try to avoid the federal cash-reporting rules by making smaller deposits that total $10,000 or more over a short period — say, a few days or weeks. This is known as “structuring” and is considered illegal. Structuring is essentially the “practice of conducting financial transactions in a specific pattern calculated to avoid the creation of certain records and reports, according to the IRS,” said Solomon.

To continue reading, please go to the original article here:

https://finance.yahoo.com/news/know-deposit-more-10k-checking-130016900.html

4 Money Lessons From High-Net-Worth People That You Need Right Now

4 Money Lessons From High-Net-Worth People That You Need Right Now

Wola Odeniran, CEPF®  Tue, April 25, 2023

Advisors often work with high-net-worth clients and are able to understand the expectations wealthy clients have about managing their finances. The good news is that some of those takeaways can be applied to clients who are not high-net-worth individuals.

Read on to understand four lessons advisors can take from high-net-worth clients – and how they can be applied to any client.

If you are looking to grow your financial advisory business, check out SmartAsset’s SmartAdvisor platform.

Almost Everyone Needs an Estate Plan

Estate-planning practices apply to every client, no matter their tax bracket, says Renee Fry, co-founder and CEO of Gentreo, a company that provides estate-planning document services.

“Financial advisors should take the example of their high-net-worth clients and apply estate-planning principles to all their customers, regardless of income bracket,” Fry says. “Every person has an estate, regardless of their income level, and thus, everyone should have a plan in place to ensure that their assets are distributed according to their wishes.”

Proper planning can help advisors build a bigger client base. “By doing so, advisors can help ensure their client’s financial security, build long-term trust and differentiate themselves from their competitors,” Fry says.

If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.

Outside Advice Is Valuable, Even When Clients Are Knowledgeable

Some clients may be titans of business or professional heavyweights, which has helped them benefit financially. “But that doesn’t mean that they know how to budget, how much insurance to have, how to invest or what to do with their wealth in terms of estate and charitable giving,” says Amy Jo Lauber, a certified financial planner and founder of Lauber Financial Planning.

Lauber also says that non-high-net-worth clients, especially those looking to improve their financial situation, often have more financial awareness than those who are wealthy.

“I find people who are living paycheck-to-paycheck are much more aware of their financial situation because they need to be,” Lauber says.

Index Funds Can Be a Foundation for Client Portfolios

To continue reading, please go to the original article here:

https://finance.yahoo.com/news/4-lessons-advisors-learn-high-170850089.html

It’s Okay to Be in Debt, Just Not Okay to Stay in Debt

It’s Okay to Be in Debt, Just Not Okay to Stay in Debt

APRIL 26, 2023  Financial Pilgrimage

Ever since college, I have always thought I was good with money. At least, that’s what I’d tell myself in my 20s. At the age of 25, I was completely debt-free! Yet, we accumulated nearly $200,000 in debt by age 30.  Most purchases were normal today: a house, student loans, newer cars, a wedding, a condo at the lake. Oh wait, a lake house is not typical, but it happened. While getting into debt was not ideal, I don’t regret any of it, and thankfully we had the financial means to dig out. However, I know not everyone is as fortunate. Regardless, this is our story.

Going Nearly $200,000 in Debt

After graduating with a master’s degree at 25, I started life with a clean slate. I had a little bit of savings in the bank that I could scrape together over the years. My “college fund” was $6,000, and since I never had to use it, my parents gave it to me after graduating.

In addition, I had saved a few thousand dollars more over the years from my job, waiting tables and bartending in college. So at age 25, I had no debt and a decent amount of money to start my life.

If I could do it all over again, there are things I would do differently. Regardless, by my 30th birthday, we had accumulated nearly $200,000 in debt. How did this happen?

Our road to accumulating this debt is not all that uncommon. Many life events can take place soon after graduating from college.

First was the newer car “needed” since I had a better-paying job and could afford it. That, of course, came with a five-figure loan.

Next was planning for a wedding. This included purchasing an engagement ring and paying for our wedding. In total, this cost us somewhere between $20,000 and $25,000. We mostly paid with savings, but it still set us back financially.

Along the way, Mrs. FP returned to school to get her teaching certificate. But unfortunately, we stared at almost $50,000 in student loan debt once she graduated.

Then, of course, we needed to live somewhere. We purchased my grandparents’ old house shortly after my grandmother passed away. The house was purchased below market value though we still ended up with a $100,000 mortgage and a home that needed completely renovated. We are still spending money renovating this house ten years later.

And last but not least, we ended up buying a lake house with family. This also included buying a wave runner and chipping in to buy a boat. My parents paid for the down payment, and we’ve split the monthly payments with my two other brothers for nearly ten years.

Shortly after agreeing to buy the lake house, we found ourselves in a bank lobby taking out a home equity loan because two bathrooms were leaking into our basement.

More debt.

And yes, we went in on the lake house purchase already nearly $200,000 in debt. I’m a terrible personal finance blogger, I know.

Drowning in Debt

To continue reading, please go to the original article here:

https://financialpilgrimage.com/okay-to-be-in-debt/

Some Things I Think

Some Things I Think

APR 26, 2023  by Morgan Housel@morganhousel

The fastest way to get rich is to go slow.

Many beliefs are held because there is a social and tribal benefit to holding them, not necessarily because they’re true.  Nothing is more blinding than success caused by luck, because when you succeed without effort it’s easy to think, “I must be naturally talented.”  Social media makes more sense when you view it as a place people go to perform rather than a place to communicate.  Comedy is the best way to teach about human behavior. George Carlin, Chris Rock, and Jerry Seinfeld have done more to enlighten others than 99.9% of psychology PhDs.

The best measure of wealth is what you have minus what you want. (By this measure, some billionaires are broke.)   The most valuable personal finance asset is not needing to impress anyone.

Most financial debates are people with different time horizons talking over each other.

From school, I remember: Every good story I was told, but none of the formulas I memorized before a test.

It’s easiest to convince people that you’re special if they don’t know you well enough to see all the ways you’re not.

“People like you more when you are working towards something, not when you have it.” - Drake

A lot of people seem to have a necessary level of stress, and when their life is going well they make up imaginary problems to fill the void.

Few things are as persuasive as your own BS, while nothing is easier to identify than other people’s BS.

Everything is sales.

Every employee is replaceable.

Those we admire most in sports, business, politics, and entertainment tend to share one quality: They knew when it was time to quit, time to pass the baton, time to disappear, in a way that preserved, even enhanced, their reputation. Nothing diminishes past success like overstaying your welcome.

The hardest thing when studying history is that you know how the story ends, which makes it impossible to put yourself in people’s shoes and imagine what they were thinking or feeling in the past.

You can only ignore the critics if you also discount the praise.

There are two types of people: Those who want to know more and those who want to defend what they already know.

My jealousy of dogs: They can sit for hours doing absolutely nothing, appearing perfectly content.

A lot of people like making money more than they enjoy having money. The change, not the accumulated amount, is the thrill.

Matt Damon says, “You retard socially and emotionally the moment you become famous. Your experience of the world is never the same.” The same may be true – and far more common – for those who become wealthy.

Most beliefs are self-validating. Angry people look for problems and find them everywhere, happy people seek out smiles and find them everywhere, pessimists look for trouble and find it everywhere. Brains are good at filtering inputs to focus on what you want to believe.

Few traits are as attractive as humility, but few are as common as vanity.

Everyone wants to be lucky and to be admired, but no one admires a person for their luck.

The market is rational but investors play different games and those games look irrational to people playing a different game.

A big problem with bubbles is the reflexive association between wealth and wisdom, so a bunch of crazy ideas are taken seriously because a temporarily rich person said it.

Logic doesn’t persuade people. Clarity, storytelling, and appealing to self-interest do.

To continue reading, please go to the original article here:

 https://collabfund.com/blog/thoughts/

Is It Better to Be Rich or Wealthy?

Is It Better to Be Rich or Wealthy?

Rebecca Lake  Fri, April 28, 2023

Being rich and being wealthy are often seen as being the same thing. After all, people who are rich or wealthy tend to have more assets and greater financial freedom than the typical person. In reality, there are some major differences that define what it means to be rich vs. wealthy. If your financial goals include rising to the ranks of the rich or growing wealth, it’s important to know how they compare.

A financial advisor can help you create a financial plan for your wealth management needs and goals.

Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests.

If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.

What Does It Mean to Be Rich?

Income is often used as a standard when measuring what it means to be a rich person. So what income is considered rich?

If you’re looking at the top 1% of earners, then you’d need an annual income of $540,009 to be rich, according to the Internal Revenue Service (IRS). The Economic Policy Institute (EPI) defines the top 1% as people who earn $819,324 or more per year.

What about the top 5% or the top 20%? If you think of the top 5% as being rich, then you’d need to make $335,891 per year according to the EPI. If you’d like to crack the top 20%, you’d need to earn $130,545 per year, according to a SmartAsset analysis of income distributions in the top 100 largest U.S. cities.

It’s important to keep in mind that income alone does not necessarily determine whether you’re rich or not. Someone who makes a higher income but spends instead of saving or has significant amounts of debt, for example, may live a rich lifestyle but be broke on paper.

What Does It Mean to Be Wealthy?

Wealth is often defined in terms of net worth. Net worth is a measurement of the difference between your assets and liabilities.

Generally, a liquid net worth of $1 million would make you a high net worth (HNW) individual. To reach very high net worth status, you’d need a net worth of $5 million to $10 million. Individuals with a net worth of $30 million or more might qualify as ultra-high net worth.

Those numbers reflect how the financial industry typically views wealth. The average American views a net worth of $774,000 as enough to be financially comfortable, with a net worth of $2.2 million required to be wealthy. That’s according to Schwab’s 2022 Modern Wealth Survey.

If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.

Differences Between Rich vs. Wealthy

To continue reading, please go to the original article here:

https://finance.yahoo.com/news/key-differences-between-rich-wealthy-140035053.html

Experts: How To Spot Money Scams Via Email and Text Messaging

Experts: How To Spot Money Scams Via Email and Text Messaging

Heather Taylor  Thu, April 27, 2023

Have you ever received a text message or email making an unusual money request? This is a type of social engineering scam often referred to as phishing, and it is quickly becoming all too common among the masses.  According to Kevin Lee, VP of trust and safety at Sift, 98% of cybercrime involves social engineering. Fraudsters using social engineering scams will trick or manipulate people into revealing confidential information including passwords, credit card numbers or other credentials. Cybercriminals will use this information to commit payment fraud or account takeover (ATO) attacks. According to a recent Sift report, ATO attacks jumped by 131% in the first half of 2022.

As phishing and money scams become increasingly convincing, what can people do to protect themselves? Here’s how you can spot money scams through email and text messaging and what to do next if you think you’re the target of a scammer.

Signs of a Money Scam

The next time you receive an unusual or suspicious text or email, keep your eyes peeled for the following signs of a social engineering scam.

Sense of Urgency

One of the most common tactics fraudsters use is creating a sense of urgency.

This is an attempt to prompt you to quickly take action without thinking all the way through about the text or email you just received. Lee uses the example of receiving a text that says your bank account will be shut down unless you immediately share a password, download something or click a link.

Grammatical Errors

Grammatical errors are common red flags indicating scammy messages. These will include obvious misspellings or strange wording and can easily be spotted.

Mismatching Sender Email and Domain Name

Look out for sender emails and domain names that don’t match. “It’s important to pay attention to missing letters or numbers that stand in for letters, like the number 0 instead of an O,” Lee said.

Jason Zirkle, certified fraud examiner (CFE) at the Association of Certified Fraud Examiners (ACFE), said to keep an eye out to see whether the sender’s email address looks like a suspicious variation of a well-known company. A good example is receiving an email from “Google” that has the email address google-support-us.com.

Texts or Emails “Claiming” Something

Zirkle said you can spot money scams through texts or emails “claiming” the following have happened:

You won a prize in a contest, even if you don’t remember entering the contest.

The email or text is from law enforcement or a government agency.

The text or email claims it is from a shipping company, like UPS or FedEx, and it needs you to click on a tracking link.

Zirkle said, “Any text messages asking you to click a link, no matter who they purport to be from, are a red flag.”

Email Attachments

Do not open or download any attachments you are not expecting in an email.

Hyperlinks in Email

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