Tag Archives: Cola

Posted in Donald Capone, Investing/Financial Planning, Jen Hill, Personal, Retirement Planning, Social Security

Tagged Birthday, Cola, CPI-W, Pension, Pension COLA, Social Security

July (YIKES GOING FAST) 2021 Financial Planning and Capital Market Review – By John Kvale

Posted on August 2, 2021 by John Kvale CFA, CFP | Leave a comment

Hello and Welcome to our July 2021 Financial Planning and Capital Market Update!

If you are too busy to read, feel free to listen as we describe our post and thoughts in friendly podcast audio format as well as Video!

Newbies –

We like to articulate our thoughts and review on a Monthly basis our Financial Planning Tips, Capital Markets and current events!

Hope you enjoy!

July 2021 Video

YouTube

Financial Planning Tip(s)

IRS Refunds and Tax Return Processing Very Delayed

In this Break In Post, after having discussions with several of you, and then touching our CPA contacts we came to the conclusion that the IRS is delayed in processing returns and more importantly REFUNDS!!!

Before we could get the news to you, this Yahoo Finance Article nicely summarizes that the IRS is behind on a whopping 20% of returns or over 30 million !

With a September 1, 2021 IRS stimulus check lookback (those who did not get the last round of stimulus will be reviewed by the IRS to see if they qualify) the IRS has their hands very full….

All together…. PATIENCE! They will eventually get to us!

Fingers Crossed For a Hot (Large) COLA Increase

Catching wind through our contacts of a possible HOT (read Large!) COLA adjustment this year for Social Security and possibly those lucky ones that have a COLA adjuster on their Pension or other retirement plan we dug in here in this post and outlined the methodology used by the SSA. The line in the sand for adjustment is later in the year but as can be seen by the latest CPI-W running at 6.1%, with a little luck, we may have a very nice adjustment on our hands!

Capital Market Comments

Valuations are Getting Better but Expectations are WAY out of Line!

In this post and with the help of our Friends at JPMorgan we happily reviewed the far right hand smartly turning graph, that is headed in the correct direction for better valuations… YAY

A bit later in the month we ran across a wonderful but somewhat worrisome poll done by Natixis of over 8000 investors and their expected return over the next 10 years…. Way off base in our minds….

Likely to see this last poll make its way into the Newsletter as these numbers are likely so exaggerated, we want more air time!

Ok…that’s a wrap for the July review….

Have a Great Day, Talk to You at the End of August!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

Posted in Audio, Clients/Clients Only, General Financial Planning, Investing/Financial Planning, Market Comments, Monthly Review, Retirement Planning, Social Security, Tax Related, Video

Tagged Cola, Forward PE, Inflation, IRS, IRS Delays, IRS Refunds, JPMorgan, Natixis, Natixis Investor Survey, Pension COLA, Social Security COLA

Social Secuirty COLA – Cost of Living Adjustment – Look Out Above – 5-6% COLA ?? Maybe … WOW … Pension Recipients You May Receive a Similar Increase …

Posted on July 26, 2021 by John Kvale CFA, CFP | Leave a comment

With a few of our industry rags shouting look out above for the Social Security COLA (Cost of Living Adjustment) we took a deep dive into the SSA (Social Security Administration) methodology for the adjustment.

Pension Recipients with COLA adjustments you likely will be in the same boat of increases, depending on the index the COLA adjustment is marked against….ok digressing a bit, but wanted to get that thought out !

Social Security COLA Methodology

Basically the SSSA looks at the CPI – W in the third quarter of the year and compares it to the prior year and marks the new COLA Accordingly….

The fuss or cheer, is due to the dramatic increase in the CPI – W …that most recent print is 6.1% WOW!

The CPI – W

“The Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) is based on the expenditures of households included in the CPI-U definition that meet two requirements: more than one-half of the household’s income must come from clerical or wage occupations, and at least one of the household’s earners must have been employed for at least 37 weeks during the previous 12 months. The CPI-W population represents about 29 percent of the total U.S. population and is a subset of the CPI-U population!”

From the latest BLS (Bureau of Labor Statistics) Here

SSA Methodology

Here is the SSA Methodology from their calculation pamphlet last year here https://www.ssa.gov/pubs/EN-05-10526.pdf

To determine the COLA, the average CPI-W for the third calendar quarter of the most recent year a COLA was determined is compared to the average CPI-W for the third calendar quarter of the current year. The resulting percentage increase, if any, represents the percentage that will be used to increase Social Security benefits beginning for December of the current year. SSI benefits increase by the same percentage the following month (January). If the increase in the CPI-W is at least one-tenth of one percent (0.1 percent), there will be a COLA. However, if the CPI-W increases by less than 0.05 percent, or if the CPI-W decreases, there won’t be a COLA.

Have a Great “COLA Adjustment Heads Up” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

Posted in Investing/Financial Planning, Social Security

Tagged Cola, Pension, Pension COLA, Social Security, Social Security COLA

October 2020 Podcast Video, Financial Planning and Capital Market Update – By John Kvale …

Posted on November 2, 2020 by John Kvale CFA, CFP | Leave a comment

Hello and Welcome to our October 2020 Financial Planning and Capital Market Update!

If you are too busy to read, feel free to listen as we describe our post and thoughts in friendly podcast audio format as well as Video!

Newbies –

We like to articulate our thoughts and review on a Monthly basis our Financial Planning Tips, Capital Markets and current events!

Hope you enjoy!

October Video

(YouTube)

Financial Planning Tip (s) –

Social Security COLA Increase 1.3%

Social Security, one of the few Pension Like Benefits that has a Cost of Living Adjustment (COLA) announced an annual increase – there is not always an increase … which we discussed here in this post with links to the announcement for those wanting more detail!

Possible Realizing of Capital Gains

With year end tax planning in mind, here in this post we discuss the possibility of realizing Capital Gains if your are on the fence and may be thinking of pushing gains out to next year…. this with approval and knowledge of your tax professional – let’s not get reckless!

Capital Market Comments

Election Outcomes and Market Reactions

Here in this post we carefully tip toe into the Election outcomes and possible market outcomes ….

Hanging Chads – No one is elected and a lengthy battle ensues – In our minds, most Market disruptive – Participants dislike uncertainty
Clean Sweep Either Direction – This may surprise you, but participants generally favor a partial party political holding
Partial Party Holding = Inferred from the points above – Partial party holding in either direction is likely least market disruptive

Have a Great October Update!

Talk to you at the end of November!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

Posted in General Financial Planning, Investing/Financial Planning, Market Comments, Retirement Planning, Social Security

Tagged Capital Gains, Cola, Election, Social Security COLA, tax planning, taxes

YEAA – Social Security Benefit Increase 2.8% – Most other Pensions to Follow too

Posted on October 17, 2018 by John Kvale CFA, CFP | Leave a comment

Each year our federal government accesses the inflationary environment and makes a determination for those on Social Security as to how much, if any, of an inflationary adjustment is needed…. AKA Cola adjustment-

COLA Adjustment – Cost of Living Adjustment

Looking into 2019, those on fixed incomes with COLA or Cost of Living Adjustments, in MOST cases will see a 2.8% increase per the Social Security Administration and their flagship marker, the CPI or consumer price index…

This includes in most cases pension, and other fixed income types, as they usually (we have just run across a disconnect, but are not to the bottom of it yet) follow the same index – good for all.

Here is the last decade of adjustments from the Social Security Administration

Social Security Tax Maximum

Ok – so the good news for those receiving fixed income could be looked at as a minor detractor for those paying the new higher Social Security Tax amount – but hey, we are all in this together –

Here is the new Social Security Tax Maximum amount with a little historical perspective for your perusal:

In 2019, the new tax maximum (said another way- the amount of money you need to earn to max your Social Security Benefit) is $132,900!

Have a great “Social Security COLA” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

Here is a great fact sheet link

Posted in Investing/Financial Planning, Social Security, Tax Related

Tagged Cola, Social Security COLA, Social Security Tax Maximume

Social Security Raise in 2018 is 2% NICE!

Posted on October 16, 2017 by John Kvale CFA, CFP | Leave a comment

The Social Security Administration announced late last week the COLA (Cost of living adjustment) based not he CPI, Consumer Price Index (see graph below) would be a 2% increase.

Three Important Numbers

2% – The increase in ALL Social Security benefits for 2018

$128,700 – The phase out level of Social Security withholdings – Medicare 3% does not phase out anymore

$17,040 – The maximum amount of employment related income you can earn AND draw Social Security early without facing a dollar for dollar tax above this amount

The CPI – Consumer Price Index

The Consumer Price Index (CPI) (to be exact, it is the CPI-W for clerical workers and wage earners- it looks exactly the same) is the basic index living adjustments for Social Security (and many other instruments) are used.

As you can see the line is generally up, but there are years that no adjustment is made!

Happy 2% raise next year!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

http://www.jkfinancialinc.com

http://www.street-cents.com

Posted in General Financial Planning, Interest Rates, Investing/Financial Planning, Social Security

Tagged Cola, Consumer Price Index, CPI, Social Security, Social Security Increase

No Social Security/Pension Cost of Living Adjustment Increase for 2016

Posted on October 19, 2015 by John Kvale CFA, CFP | Leave a comment

On October 15, 2015 the Social Security administration formally announced that there will be no Cost of Living Adjustment for 2016.

No Cost of Living Adjustment

The Cost of Living Adjustment (COLA) for Social Security and most other pension plans is based on the Consumer Price Index (CPI). Recall this is part of what Janet Yellen and her friends at the latest Federal Open Market Committee (FOMC) said was too low for their comfort and was used as one reason they did not increase rates.

Here is a good graph of the components of CPI, by Bonddad —

Believe it or not, the long term average of CPI is 2.75% – We are no where near that today !

Have a Great Day!

John A. Kvale CFA, CFP

http://www.jkfinancialinc.com

http://www.street-cents.com

8222 Douglas Ave # 590

Dallas, TX 75225