Greetings!
We often talk to parents and grandparents about sending their children to college. With costs increasing, we often feel a great deal of stress regarding loans and hear and read constantly about the dire straights of our children's and grandchildren's financial futures.
Research shows that students are not taking out loans of greater than $100,000 to go to school. According to data compiled by the Kansas City Fed, less than 3% of all student loan borrowers took out more than $100k. Only half a percent borrowed more than $200k.
The average size of a student loan is skewed upwards by the few students who take on outsize portions. The median loan debt in the first quarter of 2012 was $13,600. That's half the average number often quoted in the papers and on the news. In fact, 1/3 students graduate with no debt at all!
So maybe things are not so bad after all.
As many of you may know, I propose that students take on some of their financial burden themselves. I often propose the 1/3, 1/3 and 1/3 process: 1/3 mom and dad, 1/3 loans and 1/3 work and scholarship. The more financial responsibility our kids feel early in their lives, the more successful they will become as adults. Often, a little skin in the game helps students take their studies more seriously. We can help them enter this world with a healthy level of stress--not too much or too little--and increase the likelihood of their success. (6)
As with all financial decisions, values and goals are just as important as the financial figures. |
| Lunch and Learn: Behind the Smoke |
Last November, Colorado voted to approve the legalization of marijuana. What does this mean for employers and employees? How legal is legal? Do you have a clear cut drug policy in your employee handbook?
Please join Kim Ritter, Employment Law Attorney at Minor & Brown PC, for this discussion.
Behind the Smoke:
What Amendment 64 Means for Businesses
Date: Wednesday, March 6, 11:30 am - 12:30 pm
Location: Our office, 9800 Mt. Pyramid Court, Suite 450
Englewood, CO 80112
Lunch will be provided.
or call 303-690-5070. Seating is limited.
Friends and colleagues are welcome to attend!
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| Weekly Economic Update | |
DESPITE ANXIETIES, DOW STAYS ABOVE 14,000
The DJIA settled at 14,089.66 Friday, gaining 0.64% on the week. The S&P 500 (+0.17% to 1,518.20) and NASDAQ (+0.25% to 3,169.74) also logged five-day advances. All this happened in the face of significant instability, as Wall Street fretted over the deadlock in Italy's national elections and the sequester cuts taking effect on March 1. Congress and the White House could not arrange a deal to delay the sequestration last week, which means that $85 billion will be subtracted from the budgets of government agencies between March 2 and October 1 unless a bipartisan agreement emerges to undo the cuts. (1,2)
TERRIFIC REAL ESTATE DATA HELPS BUOY STOCKS
New home buying accelerated 16% in January - the biggest monthly rise in almost 20 years, according to the Commerce Department. Pending home sales rose 4.5% in January, the National Association of Realtors said; that was far above the 1.0% gain forecast by economists polled by Briefing.com. Finally, the December edition of the S&P/Case-Shiller Home Price Index showed a 6.8% yearly gain across 20 metro markets, bettering November's 5.5% impressive annualized increase. (3,4)
MANUFACTURING PMI RISES IN FEBRUARY
The Institute for Supply Management's manufacturing PMI improved 1.1% in February to 54.2. While the Commerce Department noted a 5.2% overall retreat in durable goods orders in January (the first decline in four months), new orders rose 1.9% when the volatile transportation category was factored out. (4,5)
CONSUMER CONFIDENCE & SPENDING HOLD UP
The Conference Board's February consumer confidence poll soared to 69.0 from January's 58.4 mark, and the University of Michigan's final February consumer sentiment survey came in at 77.6, topping the Reuters consensus forecast of 76.3. The federal government revised Q4 GDP north slightly to +0.1% last week; consumer spending rose 0.2% in January, even as consumer incomes fell 3.6%. (1,4)
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| Market Summary |
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% Change |
Y-T-D |
1Yr Chg |
5-Year Avg | |
DJIA |
+7.52 |
+8.55 |
+2.97 | |
NASDAQ |
+4.98 |
+6.05 |
+7.91 | |
S&P 500 |
+6.45 |
+10.49 |
+2.82 |
(Source: cnbc.com, usatoday.com, treasury.gov, treasurydirect.gov -03/01/13). Past performance is no guarantee of future results. Indices are unmanaged, and investors cannot invest in them directly. |
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Create a beautiful week!
Karl Frank, MBA, MSF
Certified Financial Planner (R)
A & I Financial Services LLC
303.690.5070
Citations:
1 - www.cnbc.com/id/100511717 [3/1/13]
2 - www.reuters.com/article/2013/03/01/us-usa-fiscal-idUSBRE91P0W220130301 [3/1/13]
3 - www.mercurynews.com/real-estate/ci_22670982/new
-home-sales-hit-highest-level-more-than [2/26/13]
4 - briefing.com/investor/calendars/economic/2013/02/25-01 [3/1/13]
5 - www.census.gov/manufacturing/m3/adv/pdf/durgd.pdf
6 - ConvergEx - Morning Market Commentary 1/31/2013
Securities offered through Geneos Wealth Management, Inc., member FINRA/SIPC. Investment advisory services offered through A & I Financial Services LLC, registered investment advisor. |
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| Words for Thought |
"All you need in the world is love and laughter - to have love in one hand, and laughter in the other."
August Wilson
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Riddle of the Week
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Kristi and David live at opposite ends of a metro area but attend the same college. David left for campus 30 minutes before Kristi and they met at a coffee house. Who was closer to campus when they met?
Last week's riddle:
What can explode slowly, with no smoke or flame?
Last week's answer:
A population |
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