Archives For August 2017

Researchers at Boston College’s Center for Retirement Research analyzed the current status of State and Local government defined-benefit (i.e., “traditional”) pension plans across the nation.  What they found was a bit disturbing.  Despite an assumption that the plans would earn an average return of 7.6% per year, the 170 plans reviewed by analysts actually had an average return of just 0.6% in 2016. This has dropped the average plan funding percentage to just 67.9%.  Given the underperformance with regard to investments, there remain only two viable options—increasing contributions (from governments, their workers, and/or taxpayers), or reducing pension benefits, or both.  Most observers believe that, in the end, it is taxpayers who will once again get the bill.

For anyone who has funded college costs, you know that the costs have soared for years. In fact, over the past 30 years, college tuition has risen a whopping 400%, with annual growth rates far exceeding the rate of inflation.It seems as though market forces have caused colleges to become more competitive in their pricing as last year’s increase was more in line with inflation at 1.9%. For many, college has become unaffordable, and many are quickly ruling out choices based on price, and considering a more affordable institution.

You can read more here… https://www.wsj.com/articles/in-reversal-colleges-rein-in-tuition-1500822001