Financial Headlines From The Summer

Today’s Wisdom:

A busy year hasn’t slowed down at all as we move into fall. Let’s look back at some of the top financial headlines from the summer before opening the mailbag to talk about insurance, mortgages, and the upcoming election.

Want to save time? Click the timestamps below to jump ahead to specific spots in the episode.

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What You’ll Learn:

Hopefully, you’ve all enjoyed a great summer despite some of the ongoing pandemic challenges. As we get ready to move into fall, we wanted to look back on the past few months and highlight some of the top financial headlines.

Salesforce Replaces Exxon

Maybe one of the bigger stories that didn’t get a ton of attention was the move by the Dow to replace Exxon with Salesforce. Exxon had a part of the Dow since 1928, which is remarkable. For Joel, this is a really big deal because this is a company that goes beyond gas and oil. These big companies could soon be at the forefront of developing clean energy solutions moving forward because they have the capital.

With only 30 companies in the Dow, it’s surprising to see a software-only company replace Exxon in this group. Is Salesforce a better representation of our economy right now? Many people are saying that and we’ll discuss that further on the show.

Apartment Vacancies in Manhattan

Many of us in the northeast have heard about the number of people that have left Manhattan over the last six months. Joel believes this is a short-term reaction to the pandemic that will become a long-term issue. We’ve seen the real estate market explode along the coast in Connecticut and a lot of that is coming from an increase in interest from people in New York.

Financial Planning After the Pandemic

A recent poll found that 72% of Americans will prioritize financial planning after the pandemic is over. Do we believe this will be true? It’s hard to believe that 3 out of every 4 people will now take the steps to secure their financial future if they haven’t already, but we’ll stay optimistic that this year will motivate people that needed a reason to act.

The Money Map Retirement Review is the place to start if you are one of the 72% that want to prioritize your finances. Our company offers to help anyone so take advantage and get your retirement on track.

Mailbag Questions

Life Insurance Policy

The first question we have in the mailbag today is from someone who wants to know what happens if State Farm goes bankrupt and can’t pay the death benefit on a large life insurance policy. This is a great question and we can understand why you’d be concerned. The main thing to know is that every state has a State Guarantee Fund for insurance companies, which acts similarly to FDIC with banks.

Mortgage Payments

The next question asks a common question we get about mortgage payments. Is it better to pay your house off or take advantage of low mortgage rates? A lot of things factor into this answer but it comes down to a personal preference many times. Joel and his wife made it a priority to pay off their mortgage but that’s not the solution for everyone.

The Upcoming Election

The final question is probably one of the top three topics we’re addressing right now: the upcoming election. Is it a good idea to move money to cash now ahead of the presidential election? No one knows what will happen and everyone has a different perspective on what the fallout could be. But what we will say is if your long-term retirement plan will be impacted significantly by this election, then you don’t have the correct plan.

1:19 – Salesforce replaces Exxon in the Dow.   

5:04 – Dunkin permanently closing 800 stores by the end of the year

6:36 – Huge number of vacancies in Manhattan apartments. Is this a long-term trend?  

8:21 – A big increase in online shopping this holiday season. FedEx is hiring 70,000 workers to handle shipping increases.  

10:26 – Recent poll found 72% of Americans will prioritize financial planning after the pandemic.

14:51 Mailbag Question 1: My husband has a substantial life insurance policy on him so I’m taken care of when he dies, but what happens if State Farm goes bankrupt and can’t pay the benefit?

17:26 –  Mailbag Question 2: I have enough cash to pay off my house but not sure how much it benefits me to pay it off with mortgage rates so low.

[19:39]Mailbag Question 3: I’m worried about what might happen to the market after the election. Should I be moving my money to cash now?

[22:11] – How we can help you with any of these issues.

Thanks for listening to this episode. We’ll be back again next week for another show.

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Final Thoughts:

“Some people have been shocked and they’ve woke up to their financial situation, to what’s happening with their long-term finances.”

– Joel Johnson, Money Wisdom Podcast

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