Victor Varma | Blog

Labor market improves for new college graduates

Posted on April 29, 2016March 31, 2016 by Victor Varma

At last, incomes for the latest college diploma-holders has risen to the highest level in more than a decade. And unemployment rates are falling quickly, according to a report from the Federal Reserve of New York.

The image of recent grads working in coffee shops is fading. But the data show that their experience highlights a growing divide in the U.S. economy between those with college degrees and those without.

Of course, graduates need the money. Most of them have huge college-education loans to pay off.

Richard Deitz, a senior economist at the New York Fed, and his colleague Jaison Abel, have developed data which answers the question of whether a college degree is worth the cost anymore.

The unemployment rate for college graduates has fallen from more than 7 percent in 2010 to just 4.9 percent recently. That is compared with a 5.3 percent jobless rate recently for all workers.

Mid-life crisis? Buy a motorcycle!

Posted on April 26, 2016March 31, 2016 by Victor Varma

Mid-lifers are loving motorcycles.

Most of them have wanted one for years, but kids, work, schedules got in the way.

Motorcycles are much more advanced than they were just 15 years ago. They include safety features found in cars, including anti-lock brakes, traction control to prevent skidding during acceleration, stability control to prevent skidding in turns.

Some bikes have infotainment systems that include navigation, music, bike-to-bike communication, and smartphone syncing.

Middle-aged and retired riders need a bike with firm suspension.

Harley Davidson recommends its Dyna Low Rider, which has great power, adjustable handlebars and seats, and a base price of $14,199. Used models are available and cost less.

Riding clubs abound for different types of motorcycles. When going for a group ride they enjoy like-minded people and often get together with them for other activities.

Another fun feature of bike riding: you’ll be riding and associating with people of all ages.

If it’s been a while since you rode a bike, or if it’s your first bike, take a motorcycle training class by the Motorcycle Safety Foundation. In many states you have to take a written exam to get a motorcycle license.

Before you ride, buy a helmet that features a “DOT” sticker that meets the Department of Transportation standards.

Get boots that cover your ankles and that don’t have shoelaces that could get caught in motorcycle gears.

Wear a leather or Kevlar jacket, gloves designed for motorcycling and long pants, not shorts.

Earth Day thoughts for 2016

Posted on April 22, 2016March 31, 2016 by Victor Varma

Almost everyone today shows some concern about what the inhabitants of Earth can do to keep the planet clean and livable.

Because each of us is only one person, there are no large-scale projects we can do, but if we all do something that may seem small, our combined efforts will help to keep our planet viable. A few things we can do:

Plant a tree. Over time, a single tree can improve the environment in a large area around it. So planting a tree makes a lot of sense today.

Learn about recycling. It’s all about disposing of waste materials in a productive way. It’s one of the best ideas for making the earth green forever.

The impact of a landfill can harm the Earth as it continues to grow, so take recycling seriously.

Develop a better cleaning strategy. Most people don’t have one. Your own cleaning plans might involve using natural products like vinegar for cleaning at home. Your home will be a nice place when it’s free of dust and odors.

Check froschusa.com for a wide selection of cleaning products that can be used in various ways. They use ingredients like lemon, lavender and baking soda.

Outdoors, chemicals can seep into the air and the ground, which could damage the environment.

For about 35 years, The Green Team at Gardener’s Supply (gardeners.com) has been a trusted resource for earth-friendly products. They help people garden in harmony with nature.

The Green Team has earth-friendly products that help people recycle waste into compost, build better soil, control pests organically, conserve water, protect biodiversity and grow their own food.

Companies hope to retrieve the business knowledge of pre-retirees

Posted on April 19, 2016March 31, 2016 by Victor Varma

Companies across the country from defense contractors to General Motors and General Electric are scrambling to ensure that millions of younger managers are ready to step into leadership roles as baby boomers retire.

About 10,000 boomers reach retirement age every day, according to Bloomberg Businessweek. Companies large and small are often unaware of how much company knowledge the retirees will take with them.

Dorothy Leonard, Professor Emeritus at Harvard Business School, and her firm Leonard-Barton Group, have developed knowledge-transfer programs at several GM divisions.

Until last year, boomers made up the largest portion of the U.S. population, and Generation X represented the biggest share of the workforce. Now millennials lead in both categories. They hold 20 percent of all management jobs, up from 3 percent in 2005, according to U.S. Bureau of Labor Statistics.

“In the next 10 to 15 years, we’re going to have the greatest transfer of knowledge that’s ever taken place,” says Chip Espinoza, Director of Organization Psychology at Concordia University Irvine. He says to handle the shift, companies need to create relationships between the generations.

Multinational defense and aerospace company BAE has been preparing for the retirement cliff for several years. They adopted a NASA program developed when the space agency started to lose expertise from lunar landings as individuals retired.

When BAE learns that an employee with deep institutional knowledge plans to retire, even in a couple of years, a knowledge transfer group of about a half-dozen people working in the same area is formed. The teams meet regularly to talk and exchange advice.

Younger workers get tips and older workers learn how to gradually hand off duties to junior employees.

Employers want you to leave your 401(k) behind

Posted on April 15, 2016March 31, 2016 by Victor Varma

American employers are urging employees to keep savings in their corporate plans when they leave the company or retire.

The move fits with an effort by companies to improve the terms of their plans and to encourage more workers to save. The goal is to ensure that older workers can afford to retire, which makes room for younger hires.

A huge pool of money is at stake. Baby boomers now in their 50s and 60s hold about $4 trillion in defined-contribution retirement plans, according to The Wall Street Journal. Some companies say that in 2013, for the first time, 401(k) withdrawals exceeded contributions.

Companies like International Paper tell employees that it’s easier and cheaper to keep their money in the company fund. Robert Hunkeler, V.P. of investments, says it costs workers just 0.45 percent of assets when they stay in the company’s 401(k) plan. By comparison, he estimates that it would cost 1.5 percent if withdrawn and invested elsewhere.

Financial advisors, who have been eyeing an influx of baby boomer wealth, stand to lose business and fees if companies succeed in persuading employees to leave their savings with their companies when they leave.

More than a third of American households with people age 50 to 64 have saved nothing for retirement.

Simple clues indicate tornado

Posted on April 12, 2016March 31, 2016 by Victor Varma

There are some simple clues that indicate a tornado may be on its way.

First, notice the sky. A dark, greenish storm sky or a cloud that lowers itself down in the sky — a wall cloud — could indicate a tornado.

If you are in the middle of a storm, with hail and high winds that suddenly stop and all becomes quiet, this could mean a tornado is imminent. Hail forms above rotating winds so it is a serious sign of trouble.

Many people go outside in the quiet period to collect hail or marvel at the sudden stillness, but this could be a bad move. Instead, make everyone in the family put on long pants, sturdy shoes and discuss your tornado plan. According to livescience.com, about 50 percent of injuries from tornadoes come after the storm has passed when people are injured by debris, downed wire or leaking gas.

Dust devils swirling in fields or streets could mean rotating winds have already formed above in storm clouds. Make your plans to take cover.

If you hear a continuous roar, rumble or train-like sound, it means a tornado is near. Move immediately to an inside room or basement. Sometimes sheltering under a mattress will help.

If you are driving and you see a tornado, do not attempt to shelter under a bridge or overpass. There are no handholds on overpasses and the wind tends to be stronger. Those who survive, tend to have vicious injuries, losing limbs and fingers.

If you see a tornado while driving on a freeway, pull over to the side of the road, never stop on the road itself. This creates a dangerous situation for everyone on the road. Do not park your car under a bridge or overpass. Go to the nearest ditch, lie flat and cover your head. Do not shelter under your car.

The best idea is to find a building. But this may be impossible on a freeway.

If the road configuration allows it, drive at a 90 degree angle to the direction of the tornado. Don’t put yourself in the position of trying to outrun a tornado. You likely won’t win.

In the U.S., tornado season tends to move northward from late winter to mid-summer.

Check these 5 simple ways to catch up on retirement savings

Posted on April 8, 2016March 31, 2016 by Victor Varma

The best way to save for your retirement is to start investing early and let compound interest work for you. But what if you started late or had financial problems at middle age that ate into your nest egg?

If you have a nest egg at all, you’re better off than more than a third of Americans who haven’t saved a penny for retirement. That includes a quarter of those aged 50 to 64.

When you’re behind on your savings, these tips can help you catch up:

First, focus on debt. Having little or no long-term debt can help keep monthly expenses low. Pay off the house if you can and keep your cars longer.
Reduce advisory fees. Choose low-cost index funds over high-fee annuities or actively managed funds. A Morningstar study estimates that the expense ratio across all mutual funds was about $64 per year on every $10,000.
Max out tax-deferred accounts. Take full advantage of IRAs and 401(k) plans, says an advisor at Bankrate.com. And pay yourself first by having money taken directly out of your paycheck, which ensures that the money is saved.
Work longer. Many people do. A survey from MerrillLynch found that 80 percent of those employed in their golden years work because they want to, not because they have to.
Don’t fall for risky bets. Never bet on aggressive investments or put all your eggs in one basket because you think you’ve found a sure thing, says Jeff Reeves writing in USA Today.

SUV sales are set to pass those of the family sedan

Posted on April 5, 2016March 31, 2016 by Victor Varma

Small sport-utility vehicles are becoming family favorites. Families say the ride is great, it gets good gas mileage and it has plenty of room in the back.

Buyers are willing to pay more for a sport-utility vehicle than they would for a sedan. The family sedan’s decades of dominance are coming to an end, according to Bloomberg Businessweek. They say there has been a shift in taste across the board.

Jessica Caldwell, a senior analyst for Edmunds.com says, “The compact SUV is very similar to a midsize car, only taller with more cargo capacity.”

Renovations that can add value to a home … and those that can reduce it

Posted on April 1, 2016March 31, 2016 by Victor Varma

Whether you’re thinking of selling your home or just want to improve its comfort value, there are inexpensive steps you can take to achieve either goal.
They include adding ceiling fans; updating appliances to attractive, energy-saving units, applying a fresh coat of paint and replacing old-style light fixtures.
Here are some renovations that will decrease the value of your home, according to Scott McGillivray, author of How to Add Value to Your Home.
* Breaking down the wall between two small bedrooms to create a master suite. Buyers prefer three-bedrooms.
* Converting an attached garage to living space. Sounds like a good idea, but many buyers won’t even look at a home that doesn’t have a garage.
* Adding artistic touches to the home, like large wall paintings. They can be painted over, but most buyers prefer uncluttered walls, a blank space for them to fill in, not an example of the previous owner’s tastes.
* Painting walls dark colors tends to make home buyers think the rooms are small and unwelcoming. Light-colored walls make the rooms feel larger and friendlier, which is what home buyers want, even if they will paint the walls themselves.
* Doing it yourself: Quoted in Bottom Line Personal, McGillivray says that unless you are a professional remodeler, skip do-it-yourself updates. When buyers, and the home inspectors they hire, see such work, they wonder what else you have done, such as working on the electricity and plumbing. Buyers are more confident when they feel a home has been professionally maintained.
* Adding a chain-link fence in the front yard looks cheap and unwelcoming. And it give buyers a low first impression of the property.

5 ways to protect yourself from fraud

Posted on March 25, 2016February 25, 2016 by Victor Varma

Ads on television or a friendly voice on the phone, can make a product or proposition sound mighty tempting.

But the products often disappoint and those friendly voices can belong to evil scammers.

How can you tell if you are talking to a scammer?

One thing you can do is have some firm rules about how you deal with people online or on the phone.

1. Know who you are dealing with. Is it really your grandson on the phone asking for money? Ask a question about the family that he would know but a scammer wouldn’t. If you are ordering online, read product reviews. Search for a company’s name online. See what others say about them.

2. Wiring money is like sending cash. You can’t get your money back. Don’t agree to swap a check for a wire transfer. Checks take a while to clear. Wire transfers are instant.

3. Be skeptical of claims of instant results. Beauty and health product are notorious for these claims.

4. Never reveal your social security number and birthdate over the telephone, in email or on the phone. Those two pieces of information can give a scammer all he needs to ruin your life.

5. Don’t play a foreign lottery. There is a reason this is illegal. If you must send any money, for any reason, then you haven’t won anything. You will lose your money. There will be nothing you can do about it.
Be an informed consumer; avoid scams and fraud! Visit ncpw.gov to find out more.