Airline satisfaction grows as travelers accept extra fees as their fate-By Brittany Jones-Cooper

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Airlines are generally something that we can all complain about together. But according to a new study, Americans are more satisfied with air travel than ever before.

Despite the constant news about flight delays, cramped seats, scary turbulence and in-flight confrontations, the North American Airline Satisfaction Study from J.D. Power found that customer satisfaction is at a 10-year high.

One reason customers are so happy is because fares are lower than they’ve been in a long time. Thanks to lower jet fuel prices, the airfare prediction app Hopper reports that advanced-purchase tickets cost 20% less that two years ago, and fares this summer are expected to reach a seven-year low. The  average price of an airline ticket in the U.S. dropped to $363 in the fourth quarter of 2015. According to the Department of Transportation, that's the lowest it's been since 2010.

The J.D. Power study also attributed overall higher satisfaction with air travel to the simple fact that we’ve gotten used to all those extra fees. Passengers are just resigned to the fact that they have to pay for booking, baggage, seat, and in-flight food fees that they no longer view paying them as a negative thing – it’s just part of travel. (By the way, U.S. airlines collected $3.8 billion in baggage fees alone in 2015.)

One group that does have a problem with baggage fees: the U.S. Senate. On Thursday, a handful of lawmakers asked major airlines to do away with baggage fees, especially during the busy summer travel months. They predict that without fees, more passengers will check bags, and security lines will move faster. The airline industry doesn’t agree, saying that if they remove fees, then fares might increase.

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Outside of finances, J.D. Power reports that features like entertainment options, Wi-Fi, and power plugs have also contributed to overall satisfaction. Rick Garlick, global travel and hospitality practice lead at J.D. Power, says airlines realize how important the customer experience truly is. “Airlines are making positive strides by adding value to its products and services with newer and cleaner planes, better in-flight services, improving on-time arrivals and bumping fewer passengers from their flights,” Garlick says.

When it comes to specific airlines, Alaska Airlines (ALK) dominates the competition. For the ninth consecutive year, the regional airline has ranked highest among traditional carriers with an index score of 751 out of 1,000. Delta (DAL) came in second with a score of 725.

For low-cost carriers, JetBlue (JBLU) topped the charts for the 11th consecutive year with a score of 790 out of 1000. This is the 12th time the airline has performed the highest in the study. Southwest came in right behind JetBlue with a score of 789.

And this isn’t the only study confirming that passengers are in-like with airlines. In April the Airline Quality Rating (AQR) released its report about airline performance and the results reflected the same message. Overall, the airline industry AQR score improved in 2015 showing that on-time arrival percentages had increased and the number of mishandled baggage had fallen.

With that said, customer complaints rose by 37%, proving that travelers will continue to have high standards with it comes to air travel. 

Culled from Yahoo

There's never been a better time for women to start investing-By Mandi Woodruff

New investing platforms cater to women

Women seeking out professional investment advice have never been in a more powerful position. Women now control half of all personal wealth in America — $14 trillion — and are projected to control $22 trillion by the year 2020. Numbers like these have sent traditionally male-dominated financial firms into a frantic scramble to figure out how to tap into this largely underserved market.
They're going to have to move fast. There's a growing number of promising new digital investing platforms that are tailoring their services solely with the needs of female investors in mind. Two of these new platforms are launching this week, including Ellevest, a new venture created by Wall Street powerhouse Sallie Krawcheck. Ellevest (pronounced el-ah-vest) already has an impressive list of backers, including its lead investor, investment research giant Morningstar, which kicked in $8 million of the $10 million the company has raised so far. Allianz Chief Economic Investor Mohamed El-Erian, Mastercard CEO Ajay Banga, and Karen Finerman, president of hedge fund Metropolitan Capital Advisors, are also throwing their weight behind the platform.

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Sallie Krawcheck, the former president of the Global Wealth & Investment Management division of Bank of America, …

Krawcheck's Ellevest joins women-centric investing platform SheCapital and The Daily Worth’s Worth Financial Management, which is also due to launch this week. Each of these platforms is still relatively new, and it’s too soon to tell whether the “for women, by women” approach will resonate with their target audience. Krawcheck says what they share in common is that they aren't buying into the stereotype that women aren't interested in investing. 
“The [investment] industry speaks a different language than women,” Krawcheck told Yahoo Finance. “Women don’t invest because we’re not providing them with an experience that speaks to them.”
According to a recent study by investment manager BlackRock, men are more likely to say they consider themselves “investors” and enjoy investing than women. Women overall are still less likely to invest than men, despite research showing women live longer and will need to save more to fund longer retirements. This investing gap has proven to be as stubborn to shrink as the wage gap, persisting even as women have emerged as the primary breadwinner in 40% of homes in the U.S. today and better savers than men.
"If we really want to close the gender investment gap we need to rethink [how we are giving advice]," Krawcheck says. 
Krawcheck, who has held leadership roles at Bank of America and Citigroup, is no stranger to the gender-based investing space. In 2014, she launched the first-ever gender-specific mutual fund, Pax Ellevate Global Women’s Index Fund (PXWEX), which only invests in companies with women in key leadership roles (current top holdings include Microsoft, Yahoo Finance parent company Yahoo, Inc. and Procter & Gamble).
To sign up for Ellevest, you’ll have to join a lengthy wait list.
We took a look at Ellevest ahead of its launch to see how it works.

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Source: Ellevest

Ellevest does charge a fee for its services — 0.50% of assets invested per year, which you’ll pay on top of whatever fees are associated with your individual investments. All assets will be managed by a team led by Chief Investment Officer Sylvia Kwan. Because of the low-cost digital approach Ellevest has taken, that fee is much lower than the 2%-3% cut many investment managers charge. But a fee is a fee and it eats into future returns. Krawcheck says they factor their fee into every savings projection users get, so there are no surprises.
Ellevest’s fee is higher than roboadvisors like Betterment (0.15%-0.35%) and Wealthfront (0.25%). But Ellevest doesn’t require a minimum to start investing, which might give them an edge. You need $500 to open an account with Wealthfront and you have to make a $100-a-month auto-deposit commitment to Betterment to score the 0.35% fee (otherwise, it charges $3 a month).
Among the female-centric advisory platforms on the market, Ellevest’s fees are among the lowest. Investors need $5,000 in assets to open a SheCapital portfolio with a 0.50% fee. SheCapital charges a lower fee of 0.35%, but clients must have at least $1 million in assets. WorthFM charges $2 per month for investors with less than $5,000 in assets. The fee is 0.50% once investors are over the $5,000 mark.
Says Krawcheck: “We want to be the best value. We don’t necessarily want to be the cheapest [option].”
Joe Mansueto, chairman of Morningstar, said he sees their investment in Ellevest as a natural alliance. “This is an investment in a firm that is doing something a little different than what we do. We don't have anything like this targeted to women,” Mansueto says. “It’s not just pure investment advice. It’s more goal-based [advice], all wrapped up in a really nice user experience.”

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Source: Ellevest

Like Betterment and Wealthfront, two of the leading young companies in the online automated investing industry, Ellevest emphasizes investing in stock and bond ETFs that offer broad market exposure. It offers a host of Vanguard stock mutual funds and half a dozen bond funds. Most of their 21-item menu of investments includes broad-based Vanguard index funds in a variety of flavors (funds that track the total stock market, U.S. midcap stocks, small-cap stocks, emerging markets, and developed markets, as well as a half dozen bond funds).
Based on how much you want to save and your time frame, Ellevest will automatically allocate your assets. For long-term goals like retirement, Ellevest will be more likely to put the majority of your investments in stock funds. A short-term goal like a wedding or vacation fund will be more likely to be stashed in bonds or cash.  
Where Ellevest differs from competitors is how it tailors to clients. The platform uses a goals-based approach to investing. Users select different goals — buying a house, going on vacation, starting a business, saving for retirement — and tell the platform which goals have the highest priority. You can tell Ellevest how much you want to save and how often.
Ellevest also keeps track of the likelihood that you will achieve your goal. If you start to fall off track, Ellevest will either make specific investment recommendations or ask you to increase your contributions. (They will have help available by phone as well).
Based on financial information you submit (salary, current assets, etc.) the platform uses an algorithm to produce an investment plan it thinks is most likely to help the woman achieve her goals according to her timeline. If your goals are a little too ambitious for your earnings potential, Ellevest will sideline lower-priority goals and focus on high priorities.
Part of the algorithm is based on automated investing methodologies Morningstar has long used in its investment advice offering. CIO Kwan’s team will also keep watch over users’ portfolios, making adjustments if they are unhappy with their performance.  
What you won’t find during the signup process is the standard list of “What type of investor are you?” questions that firms use to determine risk tolerance. Krawcheck would rather establish trust with women so they allow her team to decide how risky she can afford to be. Part of the reason is that women tend to take on less risk and that can work to their disadvantage as investors. In order to achieve long-term investing goals, women could use an extra nudge from a team of professionals who know what they’re doing.

“It doesn't make sense for you to invest one way because you're an introvert and another way because you're an extrovert,” Krawcheck says. “You invest to achieve a goal and not to match your personality. Instead, we base asset allocation on her unique goal and its characteristics.”

Culled from yahoo finance

Toyota forecasts net profit plunge this year as strong yen bites

The logo of Toyota is pictured at at the 37th Bangkok International Motor Show in Bangkok, Thailand, March 22, 2016. Picture taken March 22, 2016. REUTERS/Chaiwat Subprasom

TOKYO (Reuters) - Toyota Motor Corp forecast on Wednesday a plunge in net profit for the current year, snapping three straight years of record profit, hit by a sharp appreciation in the yen.

After net profit rose 6.4 percent in the year ended March to 2.31 trillion yen (14.71 billion pounds), Toyota is forecasting it will drop 35 percent this year to 1.5 trillion yen. That compares with the average estimate of 2.25 trillion yen for the current year, based on predictions from 28 analysts polled by Thomson Reuters I/B/E/S.

Toyota expects operating profit, which excludes earnings made in China, will drop 40 percent this year to 1.7 trillion yen, based on the assumption that the dollar will average 105 yen this year. The dollar averaged a far more favourable 120 yen (JPY=) last year.
(Reporting by Minami Funakoshi; Editing by Muralikumar Anantharaman)

Culled from Reuters

Should You Assume You’ll Live Until 100 for Your Nest Egg? - By Glenn Ruffenach

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Birthday cake made by one of my friends, for another of my friends!

I’m working with a financial adviser who suggests that, for planning purposes, my nest egg should last until I reach age 100. I understand the need for erring on the side of caution, but that figure seems somewhat excessive. Can you recommend a good tool for estimating one’s life expectancy?

Actually, that suggestion makes more sense than you might think. Between 1980 and 2010, the population age 90 and older nearly tripled, reaching 1.9 million people, according to the Census Bureau. Over the next four decades, the 90-plus demographic is expected to quadruple. (And just FYI: The U.S. had 53,364 centenarians in 2010.)
The point: Many people, when planning for retirement, tend to underestimate their life expectancy and, as a result, tend to overestimate how much they can spend after they leave the office.
All that said, there are several good tools that can help you judge how many more birthday parties to plan for. Two popular ones are livingto100.com and How Long Will I Live? (go to myabaris.com and click on Tools). Both incorporate variables like family history, personal health and socioeconomic status.
Also check out Blue Zones, a public-health organization, and its “Vitality Compass.” (Go to bluezones.com and click on Tools.) This particular calculator—in addition to estimating life expectancy—can help forecast “healthy-life expectancy,” or the age a person will reach before being diagnosed with heart disease, diabetes or cancer. The site also offers tips for living longer.
I am 74 years old and, each year, take my required minimum withdrawal from my 401(k) with Vanguard. My wife has a 403(b) plan with a different investment firm. She is 70 years old and needs to begin withdrawals this year. Her investment firm representative mentioned that since we file jointly on our tax return, my wife’s required withdrawal could be made from my 401(k). Is that correct?
Your wife needs a new investment rep.
There is no such thing as a “joint” 401(k) or a “joint” 403(b), says Ed Slott, a certified public accountant and individual-retirement-account specialist in Rockville Centre, N.Y. When the time comes, participants in retirement plans must make individual withdrawals from their individual accounts—even if a wife and husband file jointly and the combined income goes on the same tax return. So, you must continue to withdraw your required minimum from your 401(k), and your wife must withdraw her required minimum from her 403(b).
Indeed, if you follow the representative’s advice, you could create a nasty tax problem for yourselves, Mr. Slott says. To start, you would withdraw more than the required minimum from the 401(k) and end up paying more in taxes. Meanwhile, there would be no withdrawal from the 403(b).
Failing to take that required distribution would result in a 50% penalty on the shortfall. (If you are supposed to withdraw $10,000, the Internal Revenue Service will bill you $5,000.)
“Investment advisers really need to know the tax rules,” Mr. Slott says. “They are managing retirement accounts subject to these rules. That is the bigger story.”

I have about $1 million in various retirement accounts, mostly in stocks. I have a real-estate rental that is worth about $300,000 that is intended to generate income in retirement. In light of all I read about the asset-allocation classes of stock, bonds and cash, where would I count the real estate in these models?

Think of that property as stock.

To start, the income isn’t guaranteed, as it would be with, say, a certificate of deposit, says Mark Maisonneuve, a portfolio manager in Farmington Hills, Mich. Yes, you might have a lease and a tenant who makes regular (even increasing) payments. But unexpected expenses to maintain (or in the case of bad tenants, rehabilitate) the property could turn the asset’s return from gain to loss.

Looking ahead, the sale price of the property—if you or your heirs decide to sell—is completely unknown; there is no creditor pledging to make good on the return of principal on a set date as with a bond.

In fact, rental property would go into the more speculative part of one’s stock allocation, and requires close attention, Mr. Maisonneuve adds.

“Landlords consider rentals as safer because they see all the inner workings,” he says. “But property is never as liquid as many stocks, nor do stocks wake us up in the middle of the night to deal with a crumbling foundation or collapsed sewer drain.”

I have two questions. If my wife (born in 1954) takes Social Security before she reaches her full retirement age and continues to work, I understand that her benefits could be reduced temporarily if her salary exceeds certain levels. How does a younger spouse’s full-time earnings affect these thresholds? And if I decide to delay claiming Social Security benefits, how much time needs to pass before I see an increase in my payout? In other words, do benefits increase each month that I wait, or each year that I wait?

Your first question refers to Social Security’s “earnings test.” And you’re correct: People who collect both benefits and a salary before reaching full retirement age could see their benefits reduced if their income exceeds certain levels.

The earnings of a spouse aren’t part of this calculation. So if your wife is collecting benefits and earning a paycheck, her salary—and her salary alone—will determine if there is a reduction in her benefits.

To answer your second question: A person’s Social Security payout will increase each month that he or she waits to claim benefits. (Put another way: You don’t have to wait 12 months for a larger check.)

Let’s say you’re eligible for a benefit of $1,000 at a full retirement age of 66. If you claim benefits at age 63 and four months, your monthly benefit would total $822; if you wait an additional month, the payout would be $828. /agereduction.html.)

Culled from The Wall Street Journal

How One NASCAR Driver Plans to Avoid Going Broke in Retirement -Sheiresa Ngo

Aric Almirola with his son, Alex | Matt Sullivan/Getty Images

Stories hit the news every day about celebrities who made a fortune and then squandered it all. One sports star who has made a decision not to let this become his story is NASCAR driver Aric Almirola. The Cheat Sheet chatted with Almirola to learn more about his quest for financial security.
The Cheat Sheet: What prompted you to start learning about personal finance?
Aric Almirola: I started learning about personal finance at a really young age. My grandfather took us racing, and we left our race shop with a budgeted amount o­f cash. That was the cash we had to put gas in the truck that pulled the trailer, buy our pit passes, get food from the concession stands, and all of the things we needed when we were out racing. So I learned about budgeting and personal finance really early on in life. And, with my own personal finance, I got a crash course in finance as soon as I left college. Once I told my parents I was leaving college to follow my dream of becoming a professional race car driver, they said that if I wanted to move away from home and quit school then I was on my own. I had to figure out how to start paying for my own truck payment, insurance bills, cell phone bills, rent for an apartment, and everything that you need to survive on your own. So that forced me into learning how to manage my personal finances.
CS: What are some things you are doing to prepare your finances for retirement and life after NASCAR?
AA: The number one thing I’m doing to prepare for retirement is saving. I’m very blessed and fortunate to have a great career and make good money. To be able to do what I love is obviously a blessing, but at the same time, I have to live well within my means and save for the future. I think that’s important regardless if you’re a NASCAR driver or if you’re an everyday business man. You can’t spend more than you make because it just doesn’t work. I have the luxury of being in a position that allows me to save money, and because I do that, it’s helping me prepare for retirement.
Another important thing I’ve done to prepare for retirement is have a fiduciary adviser help me with my investments. There’s a lot of opportunity out there to invest your money, but there’s also a lot of vehicles you can use to invest your money that will also cost you money. If you’re an average investor like me and you’re not aware of what is out there and all of the hidden fees, then it can cost you a lot of money in the long run. I think it’s very important to hire a fiduciary adviser you can trust. The purpose of a fiduciary adviser is to have someone in your corner that will help you get the right unsolicited investments that they will not be getting kickbacks from or reaping the benefits of a fee structure. That’s what I’ve done and it’s been an important step in the process for me.
You also need to take an interest in your finances. I’ve taken a very aggressive interest in my personal finances and my retirement planning because nobody will have my best interest at heart more than I will for myself. It can be very confusing and challenging to understand at times, but I’m continuously digging deeper into the financial world to educate myself.
CS: What is your opinion of athletes who have gone broke after retirement? Are you ever afraid that could happen to you?  
AA: I think that’s a shame. I feel like any professional athlete is very similar to a lottery winner. There are so many people out there that are good at baseball but will never get to play in Major League Baseball. There are a lot people that are great at football but will never be professional because they weren’t on the right team in high school or college and didn’t get noticed. And it’s the same for a race car driver. I raced against thousands of kids growing up that I know had every bit as much talent as I did, and some had even more. But they just didn’t get the same lucky breaks that I did to make it to where I am today. So I really view making it to the professional level of any sport like being a lottery winner.
The pay comes along with both. It’s such a shame to see people get that money and blow it all. They don’t have any sort of reality or sense that the money will stop one day. The flow of income won’t always be there. There’s a small window of opportunity for professional athletes to make as much money as they can for as long as they can. The best professional athletes will play for 10 or 15 years. Then at the end of that they are a middle-aged person that has to figure out how to live until they’re 90 years old. If you’ve blown it buying expensive houses, cars, jewelry and all of the same stuff for your friends, then it’s really hard to plan for life after sports.
CS: What lessons are you teaching your children about money?
AA: Something that I’ve really been on our kids about is to not be entitled. That’s the biggest thing for me. Money is out there. Money is out there to be had and to be made, but you have to work for it. People aren’t just sitting around waiting to throw money at you. My son Alex is three years old and my daughter Abby is two years old, so they’re really in the infancy of learning about money. But, one thing that my wife, Janice, and I have made them do is pick up their toys in the playroom and put them all away. We ask them to help us when we have to take the garbage out. We ask them to walk out to the street with us to help us get the mail.
We do all this to help them understand the value of work because at the end of the day we give them a coin or two to put into a jar that we keep in our kitchen. They get to watch that jar fill up. It’s their piggy bank, so to speak. They don’t care much about the denomination right now. Two pennies are currently better than one quarter. They are so young that they don’t understand the denomination part, but they do understand that if they help clean up and do work that they’ll get money for that. So right now we’re mainly focusing on helping them learn that if they work, help and pitch in, they’ll earn their money.

Culled from Money & Career Cheat Sheet