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Younger people have been falling behind in their financial planning and many are approaching middle age in crisis. Our lead story addresses this, while we have been working with more new clients in planning to combat this phenomenon.
As mentioned last month, student loans can place a burden on families until paid off. We share further understanding of the student loan forgiveness program in this month's second article.
This month's "What's Happening Now" section shares interesting stories on how the Rolling Stone's new tour is a lesson in retirement planning, what the new FaceApp trend can teach you about saving for retirement, and our support for cancer research through Pelotonia, and how we will match your contribution if you would like to pledge to this worthy cause.
We'd like to hear from you. Please feel free to contact us by phone at 614-888-2121, toll-free 877-389-2121 or e-mail chornyak@chornyak.com with any questions or comments. Or, follow this link to request a meeting with us to discuss your financial planning needs: https://www.chornyak.com/appointment-request. |
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'Playing Catch-Up in the Game of Life.'
Millennials Approach Middle Age in Crisis |
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New data show they're in worse financial shape than every preceding living generation and may never recover
American millennials are approaching middle age in worse financial shape than every living generation ahead of them, lagging behind baby boomers and Generation X despite a decade of economic growth and falling unemployment.
Hobbled by the financial crisis and recession that struck as they began their working life, Americans born between 1981 and 1996 have failed to match every other generation of young adults born since the Great Depression. They have less wealth, less property, lower marriage rates and fewer children, according to new data that compare generations at similar ages.
Even with record levels of education, the troubles of millennials have delayed traditional adult milestones in ways expected to alter the nation's demographic and economic contours through the end of the century.
Millennials helped drive the number of U.S. births to their lowest levels in 32 years. That means fewer workers in the future to support Social Security and other public programs for the ballooning population of retirees.
Social Security last month estimated that in 2035, after nearly all baby boomers retire, there will be 2.2 workers per beneficiary. Last year, there were 2.8. The current birthrate of around 1.8 children per woman is expected to create a Social Security deficit of nearly $2 trillion over the next 75 years.
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UNDERSTANDING THE BORROWER
DEFENSE TO REPAYMENT STUDENT
LOAN FORGIVENESS PROGRAM
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Have you heard the term borrower defense to repayment but are not sure what it means? Are you wondering if it could apply to your student loans? Read on to learn more about this program, as well as how to determine your eligibility and apply.
Have You Been Misled?
Borrower defense to repayment is a federal student loan forgiveness program available to students who obtained certain federal student loans while attending a school that either misled students or violated certain laws. Many of these violations occurred at institutions owned by Corinthian Colleges, Inc. (i.e., Everest Institute, Everest College, Everest University, Heald College, and WyoTech), affecting students who attended between July 1, 2010, and September 30, 2014. Although the issue is not limited to these schools, Corinthian Colleges gained particular attention during the sale and closing of several of its schools in 2015.
If you attended a school that you believe misled you or engaged in conduct that violated laws directly related to federal student loans you obtained during that time, a student loan forgiveness discharge may be a possibility. Further, if you have already made payments on those loans, you may request to be reimbursed.
Determining Eligibility If one of the following situations applies to you, you may be eligible for federal student loan forgiveness:
Do you believe you were defrauded by the school you attended, and/or do you believe the school violated state laws? If yes, then you may be eligible for a federal Direct Loan forgiveness discharge through the borrower defense to repayment program. Parent PLUS federal student loans may be eligible for forgiveness as well. According to Rev. Proc. 2015-57, amounts discharged through the borrower defense to repayment process may be excluded from gross income, to be determined on a case-by-case basis.
Did your school close while you were attending (and you have not transferred to a similar program at another school)? If yes, then you may be eligible for a closed school discharge. Upon meeting the requirements for this relief, you can apply for a loan discharge for a federal Direct Loan, the federal education loan program, or a federal Perkins Loan. Contact your loan servicer to apply for a loan discharge. According to Rev. Proc. 2015-57, amounts discharged under the closed school debt relief will be excluded from gross income. Read More
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Positive July for U.S. markets Markets had a solid start to the third quarter, with all three major U.S. indices showing gains for July. The S&P 500 returned 1.44 percent during the month, the Dow Jones Industrial Average rose by 1.12 percent, and the Nasdaq Composite gained 2.15 percent. This positive performance was supported by better-than-expected earnings results. According to Bloomberg Intelligence, companies in the S&P 500 have been outperforming analyst estimates for the second quarter. As of July 31, with 60 percent of companies reporting, year-overyear earnings growth sits at 0.8 percent for the quarter. This result is much stronger than the 2.2 percent decline that was forecast at the start of earnings season in mid-July. Ultimately, fundamentals drive long-term market performance, so this positive surprise for the second quarter is encouraging. Read More
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Securities and advisory services offered through Commonwealth Financial Network®
member FINRA/SIPC, a registered investment adviser.
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