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Ponderings For the Week of August 3 to 9, 2020

Stocks Rose Despite Dysfunction in Washington

Most domestic stock indexes rose in the concluding week of July as a majority of quarterly corporate earnings reports produced pleasant surprises. Technology stock price gains again boosted the upside while energy stocks led the laggards with Exxon and Chevron reporting gargantuan second quarter losses.

Meanwhile, it was business as usual in a dysfunctional federal government, led by a stall in stimulus negotiations in Congress. Economic reports were also uninspiring. Second quarter gross domestic product (GDP) contracted a bit less than had been feared, but still enough to be the largest decline in modern history. But there were a couple of positive economic reports last week. The manufacturing sector appears to be on the road to recovery. Home sales rose in June for the first time in four months.

International stocks had a generally bad week due primarily to worries in both Europe and Asia about the rising incidence of coronavirus infections.

Advice for Those Considering a Career Change (Part I of II)

Changing careers is becoming the rule rather than the exception.  If you’re a middle-aged work veteran, how many careers have you had thus far? If you’re new to the workforce, ask your parents how many careers they’ve had. Rare is the individual who is a lifer with one career anymore. 

Why do you want to change?  If you’re thinking of a change, what’s the reason? Is it to earn more money or to have a more satisfying work life? The best of all worlds would be to have both a more stimulating job that pays more money. That may be a tough combination to achieve. It’s certainly within the reach of a business owner, but starting a business is a risky undertaking.

Before changing careers, weigh the pros and cons of your current occupation. Take inventory of what you like or dislike about your job. Are you unhappy with the type of work you do? Or, are you dissatisfied with the culture of the company? If you don’t like the way your company does business, you can search for a better employer. But if you’re unhappy with your occupation, you may need to make a bigger change. Perhaps you’re a pet food taster (yes, there is such an occupation) but you’d like to change your career and yet still exploit your sensory skills by becoming a wine taster. 

If you’ve decided that changing careers is in the cards, evaluate your interests and skills. Ask yourself:

  • What have I done in the past that I really liked doing?
  • What would I really love to do for a living?
  • Can I use my current skills in my new career?
  • Do I need more education or training in another field?

Next week, the second and concluding installment will offer several suggestions for those who want to change careers which is becoming even more prevalent as the pandemic jeopardizes many jobs.


Smart Money Tips

  • Raise deductibles to make your insurance more affordable. Insurance is expensive albeit absolutely necessary, but you can make it more affordable by raising the deductibles, in other words, by being willing to pay more in the event you suffer a loss. The insurance industry isn’t always very good at letting policyholders know about higher deductible coverage, so you’ll need to take the initiative. But if you can afford higher deductibles, particularly auto and homeowners or renters insurance, by all means check out the savings.
  • Are you sure your beneficiary designations are up-to-date? Many people unwittingly think those whom they have designated as beneficiaries, executors, etc. are okay when they are not. Some changes, like divorce or the death of a spouse, are obvious triggers of required document changes, although it’s surprising how many forget to make the needed changes. Other changes are subtler, but nevertheless require revisiting retirement plans and estate planning documents. For example, someone may have designated all children to inherit equal shares of the estate, but wants to disinherit one child who has since become estranged from the family. In addition to the will, other documents where the child is named, e.g., a life insurance policy, may also need to be revised. Another often-overlooked triggering event is a name change, for example, the marriage or divorce or remarriage of a daughter. While the name change may not cause undue problems in the future, revising certain documents, e.g., health care proxy and power of attorney, to reflect the new name may avoid a delay later on.



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