Friday Financial Five – November 20th, 2015

Friday, November 20, 2015

Daniel P. Forbes GoLocalPDX MINDSETTER™

Morningstar rates the 529 plans

Morningstar conducted their annual ranking of the states’ different 529 college savings options. The criteria include five P’s – Performance, Price, Parent, Process, and People. Two plans received a negative rating – Arizona’s Ivy Funds plan and the South Dakota plan. Rhode Island’s CollegeBoundfund, one of the largest 529 plans in the country, will be changing investment managers from Alliance Bernstein to Invesco. Ascensus, the new plan administrator, will be opening offices in the state in 2016.

Gini used to compare large city income inequality

The Gini coefficient was created by Italian statistician Corrado Gini to measure individual income inequality in an economy. A Gini measurement of zero reflects total equality and a calculation of one means complete inequality. Bloomberg used the measurement (http://www.bloomberg.com/news/articles/2015-11-10/the-10-most-unequal-big-cities-in-america ) to compare large U.S. cities, each with at least 250,000 in population. Based on these findings, the city with the highest level of inequality is New Orleans. Rounding out the top five are Atlanta, Cincinnati, Boston, and Dallas. All of the large cities listed have a Gini calculation between .5 and .6, which are higher than the country’s average of .48. The United States has seen this average increase pretty dramatically over the last five years.

Forbes 40 under 40

No cities in California hit the top 10 for the Gini coefficient, but California is called home for 33 of the top 40 wealthiest American entrepreneurs under the age of 40. Mark Zuckerberg heads the list with a net worth of over $47 billion. He has four times the wealth of former roommate and number two on the list, Dustin Mokovitz. All of the list’s entrepreneurs are worth at least $400 million, with 34 of them making their fortune in the tech sector. The lone woman to make the list is Elizabeth Holmes, who started a blood-testing company called Theranos.

HARP remains an option through 2016

The Home Affordable Refinance Program (HARP), a product of the financial crisis, continues to exist at least through the end of next year. While the program has undergone recent revisions, terms of eligibility are still available at the HARP website (http://www.harp.gov/ ). Borrowers need to be current on their mortgage and have a Fannie Mae or Freddie Mac loan. The loan would have to have been originated before or on May 31st, 2009, with the outstanding mortgage balance representing greater than 80% of the home’s value. To date, the program has refinanced over 3 million borrowers.

Madoff victims awarded over $1 billion

Another byproduct of the crisis was the uncovering of the Bernie Madoff Ponzi scheme. Roughly seven years later, that case is moving towards a conclusion. The bankruptcy judge overseeing the liquidation of Bernard L. Madoff Investment Securities, LLC approved the distribution of $1.18 billion by the end of the year. At that point, over half of the $17 billion bilked from of clients will have been recovered.

Dan Forbes, a CFP Board Ambassador, is a regular contributor on financial issues. He leads the firm Forbes Financial Planning, Inc in East Greenwich, RI and can be reached at [email protected].

Related Slideshow: Oregon Business Rankings in US

See how Oregon stacked up against the other states in the U.S.

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ThumbTack

Oregon gets a C+ for small business friendliness from Thumbtack, in conjunction with the Kauffman Foundation.

According to the ranking:

Overall friendliness C+

Ease of starting a business B
Ease of hiring D+
Regulations D
Health & safety D
Employment, labor & hiring D
Tax code D+
Licensing C-
Environmental D
Zoning D+
Training & networking programs B+