Healthcare costs are strangling us

Recently, none other than the Sage of Omaha, Warren Buffet, has sounded the alarm on what he sees as the number one threat to American businesses—rising health care costs. His advice is that we better do something and do it quickly. While Congress bickers over how to repeal and replace Obamacare, there is still a large body of American politicians who believe we should simply return to the good old days. While they fiddle with adjusting insurer’s premiums, or gutting Medicaid, the entire healthcare system surrounding them continues to burn. While they debate whether you should be responsible for your own medical insurance and how much Medicare should cover, health care costs rise at the rate of hyperinflation. Our legislators and president are strangely silent on what happens to those whose employer does not provide health insurance because they can’t afford it; (which is the case for many in small businesses). And by the way, small businesses happen to be the main employer of American labor. They are also silent on what happens to those of us whose Medicare insurance premiums, plus uncovered medical expenses, become higher than their retirement income. Recent estimates put uncovered medical costs at $260,000 for these same retirees. Of course, there is always Medicaid for the impoverished among us. But even that program, if the House has its way, will be reduced by $1 trillion this year. The politicians are focusing on the symptoms and not the cause of our healthcare problems. Mr. Buffet, a Democrat, in his recent shareholder meeting, took time to address what he called the real problem for American business,...

Should college be free?

Recently, New York became the first state to offer a tuition-free college education to middle-class students at two and four year public colleges. Tennessee, Oregon and the city of San Francisco have also given similar benefits to students attending community colleges in their states. It’s about time. The headline of this column was taken from a series of articles I first published six years ago. At the time, I argued that the benefits of a college education today were about equivalent to the worth of a high school degree back in the 1940s and 1950s. Back then, graduating from high school opened the door to a good job, while creating a population of largely, law-abiding citizens (and guaranteed educated cannon fodder for the country’s military in time of war). Back in the day, when Thomas Jefferson first suggested creating a public school system, he and others like him argued that a free and common education would create good citizens, unite society and prevent crime and poverty.   It took decades before that concept became law but, once implemented, it worked as the founders expected. However, as society changed, a high school education was no longer sufficient. The computer age ushered in different educational demands and skill sets that students could only acquire in a higher-education environment.  For all intents and purposes, college (and vocational schools) has replaced high school as the entrance ticket to the “American Dream.” As such, I reasoned that since public high school education is free in the United States, why then should Americans pay for college? Under the New York legislation, tuition will be free for...

Markets wobble as geopolitical concerns escalate

This holiday weekend will be a worrisome one for global investors. Concerns that North Korea may decide to exhibit another show of force in the face of American warships off its coast has markets cautious and with good reason. The sad truth is that Kim Jong-un, the North Korean dictator, is unpredictable. It is one reason why the United States has steered clear of military confrontation with this country—up until now. If he does try something, like a nuclear missile test for example, our new president’s response may also be unpredictable. In fact, my hope is that China can exert pressure on its North Korean neighbor to stand down. In a remarkable shift in Chinese policy, a PRC-controlled media outlet warned North Korea this week that China would respond to any nuclear test severely. It could, for example, stop the flow of oil into North Korea. That would cripple North Korea’s already troublesome economy. It has also staged troops on its border with North Korea. I doubt they would use them but… Behind the scenes, President Trump and his Chinese counterpart, Xi Jinping, have been talking by telephone this week to diffuse the situation. Was there a little deal-making going on as well? It was probably not a coincidence that China voiced public displeasure with its long-term client state in the same week that Trump declined to name China as a currency manipulator ( something he had promised to do while campaigning). Adding to investor’s worries is the continued back-and-forth between the Russians and the Trump Administration over Syria. Evidently U.S. spyware had recorded Syrian officials discussing the planned...

Don’t let romance blind you to the financial downside of living together

Unmarried couples need as much, if not more, financial and estate planning than those who are married. Without it, one or both partners may lose everything they have committed to the relationship. Here is a primer on what steps you should take. Over 6.7 million unmarried couples are cohabitating in America at last count. Over 90% of them are heterosexual, in case you’re wondering. As such, these couples, regardless of sexual orientation or length of the relationship, are considered and classified as unrelated individuals in the eyes of the law. And the rights of unmarried couples are different depending on your state. Not all states, for example, recognize common-law marriages. As a result, without legal safeguards, the children you are raising, the assets you have mutually accumulated, and the house that you share can easily be taken from the surviving partner. The law will assume that any property and the care of surviving children should pass to your next of kin. Even your stated wishes of what you would want to happen in the event of your death or disability may not be followed. Okay, now that I have your attention, the first rule is to protect your estate. Your estate is everything and anything you own, or have contributed to before your death. Next, there needs to be documents established for situations that may be short of death but that still safeguard your rights. This would include what happens to you and/or your partner in the event of disability or illness, which might require someone else to make medical and financial decisions for you. Such an agreement is...

America’s road toward universal healthcare

The GOP’s plan to repeal and replace the Affordable Care Act was introduced this week. As one might expect, the Republican Party’s long-awaited plan was met with a firestorm of protests from just about every conceivable lobbying group. That’s exactly what one should expect, given that there is so much at stake. Headlines throughout the week warned that if the plan were passed in its present form, healthcare premiums could rise by 30% or more. Seniors could pay far more for coverage under the new plan, while between 6 million and 10 million people would lose their health insurance coverage altogether. The poor would get short shrift, while the wealthy would benefit most. The new plan dubbed “The American Health Care Act,” (if all goes as planned) will be rolled out in three phases under a budgetary process that would allow Republicans to pass the bill through a simple majority in the Senate. The problem is that although Republicans are unanimous on the need to repeal the Affordable Care Act (ACA), the party is divided in how to replace it. Readers might recall that after the landslide Republican victory in the general election, many Americans were worried that Obamacare would be abolished altogether. The doomsday crowd is convinced that the country’s health care insurance coverage will go back to the way things were prior to the ACA. I argue that it is too late for that. Regardless of what you may think of President Obama, he and the Democratic Party set this nation on a new course. It will, in my opinion, result in universal health care coverage for...

Pet trusts are the way to go

If you have been avoiding a visit to an estate planning lawyer, despite the pleading of your spouse, your kids or grandkids, consider this: your pet’s future well-being could be in jeopardy without a legal safeguard. As I wrote in my last column, new legislation is surfacing in a number of states that recognizes our concern for our pets. Even though we consider our pets part of the household, legally, your pet is not considered a human. Instead, they are considered tangible property and, generally speaking, tangible property cannot be named as a beneficiary of a trust. Many states, however, are allowing legally enforceable documents that can guarantee a pet’s continuing care. Forty-six states and the District of Columbia have passed statutes specific to pet trusts, according to the Animal Law Review.  In Massachusetts, legislation was passed in 2011 to provide for pets’ welfare after their owners’ demise. “The definition of tangible personal property hasn’t changed,” explained Attorney Holly Rogers, an expert in the area, “but legislatures have recognized a compassionate exception when it comes to our pets.” The primary legal document required to safeguard your pet is a pet trust, according to Attorney Rogers: “It can be as simple as ‘I leave $20,000 to my sister, Betty, for the care of my cat, Fluffy’,” The pet trust can be a stand-alone document, inserted into your will, or worked into your existing revocable trust. And, as we have written in the past, everyone should have a will or trust anyway. A trust is especially important if minors or adults who can’t care for themselves are involved.  A trust allows...