3 Tips for Living Comfortably on Social Security Benefits Alone - The Motley Fool

For a good chunk of American retirees, Social Security benefits are a major source of income. Roughly half of married beneficiaries rely on Social Security for at least 50% of their income according to the Social Security Administration, and around one in five couples depends on their benefits for more than 90% of their retirement income.

Despite the fact that so many people rely on their benefits to make ends meet, not saving anything on your own and expecting Social Security to cover all your retirement expenses isn't the best idea. The average beneficiary only receives around $1,400 per month, and most people will need to pinch pennies to get by on that amount.

That said, sometimes people have no choice but to make the most of Social Security in retirement because they don't have much in savings to fall back on. While it's never too late to start saving, if your savings run dry a few years into retirement, finding ways to live comfortably on Social Security alone may be your best bet. Fortunately, there are a few things you can do to ensure you're living your best life on a tight budget.

Image source: Getty Images

1. Delay claiming benefits to earn bigger checks

Exactly how much you receive in Social Security benefits depends on when you claim them. The only way you'll receive the full amount you're theoretically entitled to is to claim at your full retirement age (FRA), which is 66, 67, or somewhere in between, depending on when you were born. You can claim earlier than your FRA (as early as age 62), but by doing so your benefits will be reduced by up to 30%. On the other side of the coin, if you wait until after your FRA to claim (until age 70), you'll receive extra money on top of the full amount you're entitled to -- up to 32% more, in fact.

Once you start claiming benefits, you can technically change your mind. But you only have a year to do so, and you have to repay the benefits you've already received. Once your decision has been locked in, you're stuck with your benefit amount for the rest of your life (although yearly cost of living adjustments will affect exactly how much you receive). That means if you claim early and receive smaller checks, you'll receive those smaller checks for life. But if you delay benefits to earn those fatter checks, you'll receive more money every month for the rest of your life.

Those bigger checks can go a long way if Social Security is your only source of income in retirement. Even an extra few hundred dollars per month can be the difference between just getting by and being comfortable.

2. Pay off as much debt as possible before you retire

The fewer debt repayments you have to make each month, the more money you have to spend on fun retirement activities. This is especially important if you're going to be living on Social Security alone, since every dollar counts.

If you can't pay off all your debt before retirement, focus first on the debt with the highest interest rates. The longer it takes to pay off high-interest debt, the more your interest payments will snowball over time. Depending on how much debt you have, you may end up paying thousands of dollars in interest alone. Even if you're making more than the minimum payment every month, if the majority of that money goes toward interest, it could take years to pay off your debt completely.

Once your highest-interest debt has been repaid, then tackle the debt with the next-highest interest rate, and so on until you're debt-free.

If you're struggling to pay down debt and save for retirement at the same time, establish your priorities by looking at the type of debt you have and what you're paying in interest. While it's always a good idea to set at least a little money aside for retirement, if you're carrying thousands of dollars in debt and paying, say, 18% in interest per year, putting money in a retirement account earning annual returns of 7% may not do as much good as paying off your debt.

3. Rethink your retirement expectations

You may dream of spending your retirement traveling across the country or lounging on the beach every day. But if you're going to be living on Social Security benefits, you may need to scale back your expectations.

That's not to say you can't live a perfectly enjoyable retirement on a budget. No matter where your interests lie, there are plenty of free and inexpensive activities to enjoy in retirement. You may not be able to travel the world and splurge on expensive hobbies, but that doesn't mean you have to spend retirement stuck at home in front of the TV. Find a cause you care about and start volunteering at a local non-profit organization, write that novel you always said you never had time for, or grab a few friends and explore your city's parks and museums. There are plenty of ways to enjoy retirement without spending a lot of money if you know where to look.

Spending retirement on a tight budget is a great opportunity to stretch your creative muscles and find ways to cut costs without sacrificing your quality of life. For example, when you want to take the occasional vacation, try traveling during the off season when airline tickets and hotel rooms are cheaper. Or if you've always wanted to learn a new hobby, research online to find some free tutorials and practice your skills at home before you sign up for expensive classes.

While living on Social Security benefits alone isn't ideal, if it's your only option you can still make the most of it. By being creative with your retirement lifestyle and making strategic financial decisions, you can still enjoy a comfortable retirement even on a tight budget.

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2019-06-30 10:15:00Z
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China's factory activity shrinks as U.S. tariffs, slowdown hit orders - Investing.com

© Reuters. Workers direct a crane lifting steel pipes for export at a port in Lianyungang, Jiangsu

BEIJING (Reuters) - China's factory activity shrank more than expected in June, an official manufacturing survey showed, highlighting the need for more economic stimulus as U.S. tariffs and weaker domestic demand ramped up pressure on new orders for goods.

The Purchasing Managers' Index (PMI) stood at 49.4 in June, China's National Bureau of Statistics said on Sunday, unchanged from the previous month and below the 50-point mark that separates growth from contraction on a monthly basis. Analysts polled by Reuters predicted a reading of 49.5.

The weak manufacturing readings are likely to cast a shadow over the apparent progress U.S. and Chinese leaders made at the G20 summit in Japan over the weekend in restarting their troubled talks over tariffs amid a costly trade war.

They will also spark concerns about stalling growth in China and the risk of a global recession, despite slightly better-than-expected export and industrial profits data in May.

Many economists still expect the economy to face strong headwinds in coming months as domestic demand falters and external risks rise.

"Although the outcome of the G20 summit (in Osaka) might boost confidence for some entities, organic growth in the economy is still insufficient, and counter-cyclical stimulus policies need to be maintained," researchers at Huatai Securities wrote in a research note on Sunday.

"The PMI index continued to fall across the board this month, and only the raw material inventory sub-index was up due to weak demand," the research note read.

In June, China's factory output growth slowed, with the subindex falling to 51.3 from 51.7 in May while the contraction in total new orders accelerated to 49.6 from 49.8.

Export orders extended their decline with the sub-index falling to 46.3 from May's 46.5, suggesting a further weakening in global demand.

Import orders also worsened, reflecting softening demand at home despite a flurry of growth-supporting measures rolled out earlier this year.

Southwest Securities said weak new export orders reflected a fading of the front-loading effect, which had temporarily boosted exports as Chinese companies rushed to place orders before more tariffs took effect.

Presidents Donald Trump and Xi Jinping held ice-breaking talks at the G20 summit on Saturday. However, Chinese state media warned on Sunday Beijing and Washington will likely face a long road before the two countries could reach a deal.

Analysts at Nomura expect any gains achieved on a temporary trade deal between China and the United States would prove fleeting with a renewed escalation likely further down the road.

Trump has already imposed tariffs on $250 billion of Chinese goods and is threatening to extend those to another $300 billion, which would effectively cover all of China's exports to the United States. China has retaliated with tariffs on U.S. imports.

To deal with the economic challenges, policymakers have released a range of measures and are expected to launch more. Premier Li Keqiang last week pledged to cut real interest rates on financing for small and micro firms.

Goldman Sachs (NYSE:) said the lack of any substantive progress in Sino-U.S. trade talks at the G20 over the weekend suggested stimulus, including cuts to banks' reserve requirements, was likely to be needed.

"We expect more policy easing (two more reserve requirement ratio cuts in 2H this year, more fiscal measures to support infrastructure investment) to come in the next few months," Goldman Sachs said in a note.

    Manufacturers continued to cut jobs in June, with the employment sub-index falling to 46.9, compared with 47.0 in May, when it hit the lowest level seen since March 2009.

An official business survey showed activity in China's services sector held firm in June despite growing pressure on the broader economy from U.S. trade measures, with the official reading at 54.2 in June from 54.3 in May.

Beijing has been counting on a strong services sector to pick up the slack as it tries to shift the economy away from a dependence on heavy industry and manufacturing exports.

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2019-06-30 08:47:00Z
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Bargain hunters for stocks, gold and bonds face one simple fact: a synchronized rally means nothing is cheap - MarketWatch

Stocks are pricey but so are bonds and gold. Even bitcoin has caught a bid after a months long fallow period recently, giving way to a powerful burst higher.

That dynamic has left many investors, strategists and other Wall Street watchers wrestling with some tough questions: What to buy if everything is trading at a relative premium to historic averages and the swiftly changing narrative on trade or the economy could ignite stomach-churning price swings?

And if it feels like the recent tandem asset run-up has the markets on a knives edge, it may be for a good reason. “Things can quickly change on a dime from a [Federal Reserve] perspective, from a trade perspective,” Lindsey Bell, investment strategist at CFRA, told MarketWatch in a recent interview.

The S&P 500 price-to-earnings — a popular way of valuing stocks — on a trailing 12-month basis is at 21.83, compared with a 10-year average of 17.87, according to Dow Jones Market Data. That means the combined price of the constituents of the index was almost 22 times the net earnings produced over the past year. The historical mean is 15.75.

If investors find those valuations rich, so-called haven investments also are pricey. Gold prices GCQ19, -0.08% for example, which don’t normally rally alongside assets perceived as risky like stocks, finished not far from their highest level in six-years on Friday at $1,413.70 an ounce, based on the most-active futures contract. That is higher than the one-year ($1,264.87/oz.), five-year ($1,243.19/oz.) and 10-year averages ($1,324.85).

The 10-year Treasury note yield TMUBMUSD10Y, +0.00% finished last week’s trade at 2%, about half-a-percentage point below the 10-year average for the benchmark bond at 2.482% — briefly dipping beneath that level to mark a nearly three-year nadir.

Outside of those widely followed instruments, bitcoin BTCUSD, -2.12%  is trading at around $12,000, despite an end-of-the-week stumble, well above its average over the past three years at $5,253.56.

And a measure of the stock-market turbulence also is relatively richly priced. The Cboe Volatility Index VIX, -4.68% also known by its ticker symbol VIX, typically rises when stocks fall and for that reason is a common way to hedge against market slumps, stands at 15.08, not far from its five-year average at 15.08 or the 10-year average at 17.34.

The curious state of affairs in the investing landscape is one that some strategists argue is the byproduct of global central bankers who are struggling to sustain a decades-old recovery.

The Federal Reserve is considering easing monetary policy after a series of interest-rate increases that began at the end of 2015. Fed Chairman Jerome Powell has said “cross currents” from a dispute over trade policy and import tariffs between China and the U.S. is at least partly the justification for lowering borrowing costs again. The European Central Bank is similarly considering restarting measures to stimulate the eurozone’s economy.

One possible consequence of this monetary easing is some $13 trillion in government debt that offers yields below zero, meaning that lenders can expect to recover less than their original investments from sovereign borrowers.

“I think one of the unintended, yet in hindsight predictable, outcomes of ZIRP [zero interest-rate policy] was to force investors into looking for returns anywhere they can find it,” Michael Antonelli, a market strategist at Baird, told MarketWatch.

“Stocks, gold, real estate, even the burgeoning world of crypto-currencies, if you offer zero or negative interest rates on an ever increasing amount of ‘safe’ government debt then investing behavior will be altered,” he said.

On Friday, the Dow Jones Industrial Average DJIA, +0.28% put in its best June return since 1938, the S&P 500 index SPX, +0.58%  notched the best such gain since 1955, and the Nasdaq Composite Index COMP, +0.48% marked its best June since 2000, even as those benchmarks logged weekly losses amid uncertainties over trade policy ahead of the closely watched G-20 meeting in Osaka, Japan on Saturday.

Antonelli said a “great many assets” are “rich” compared against historical valuations, adding that “whether that unravels at some point only time will tell but the behavior of it seems very human to me.”

Still, investors are clearly uneasy. Bank of America Merrill Lynch analysts led by Michael Hartnett, chief investment strategist, say that investors have never been so negative on a market that is rallying so briskly (see chart below):

Perhaps, the biggest risk of the rally in assets across the board is, as CFRA’s Bell says, the narrative can change swiftly and assets that don’t tend usually move in lockstep can revert to their normal levels and correlations, potentially bruising investors’ wallets.

On Saturday overnight, U.S. President Donald Trump and China’s President Xi Jinping agreed to a cease-fire in their yearlong trade war, averting an escalation in potentially market-rattling tensions, but a substantive deal is far from certaint and volatility is the likely reality in the near-term even as talks resume.

Read: Kyle Bass says Wall Street investors should ignore G-20 and brace for a fresh round of Trump tariffs

Check out: Investors awaiting the G-20 meeting miss a key point: The damage from U.S.-China trade war may be done already

So what’s an investor to do against that backdrop?

Bell says a balanced, diversified investment portfolio is the answer. The strategist recommends an allocation of 55% in stocks (15% of that in foreign equities) 25% in bonds, 15% in cash, and a 5% allocation to gold. “You have to a carefully crafted portfolio,” she said.

Looking ahead:

It’s a holiday-shortened week, with U.S. markets closed in observance of Independence Day on Thursday, July 4.

JOBS, JOBS JOBS: Investors will watch for the most important labor-market report since the last one. The Labor Department’s nonfarm-payroll report for June comes after job growth of 75,000 in May, well below estimates of 185,000. Economists’ consensus estimates for June is for the creation of 170,000 jobs and an unemployment rate holding at 3.6%. The report is due at 8:30 a.m. Eastern Time.

Monday

A gauge of manufacturing activity for June is due at 9:45 a.m., with the more closely watched read from ISM at 10 a.m. Data on construction spending also is due on that day at the same time.

Wednesday

A read on private-sector employment from ADP is due at 8:15 a.m. ET, with a reading of weekly jobless claims to follow at 8:30 a.m., a day earlier than usual because of the Fourth of July holiday, along with a trade-deficit report. At 9:45 a.m., IHS Markit services service-sector report, followed by ISM’s non-manufacturing gauge at 10 a.m., as well as a report on factory orders at the same time.

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2019-06-29 18:56:00Z
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Delta Air Lines' Oil Refinery Just Became Way More Valuable - Motley Fool

Philadelphia Energy Solutions' refinery suffered a massive explosion and fire in the early morning of June 21. (Fortunately, there were only a handful of minor injuries.) Last week, the company -- which filed for bankruptcy last year and has continued to face financial difficulties -- announced that it will not repair and reopen the South Philadelphia facility.

This marks a sudden end for the largest oil refinery in the Northeast. But it's good news for Delta Air Lines (NYSE:DAL), which owns one of the few remaining refineries in the region. (Several others have closed over the past decade.) While other airlines could face higher jet fuel prices due to the loss of refinery capacity, Delta's Monroe Energy subsidiary could see a nice uptick in profits from higher refining margins.

Delta's unusual investment

Seven years ago, Delta shocked observers by buying a refinery in Trainer, Pennsylvania, that had recently been shuttered by Phillips 66. Delta's total investment was around $250 million: $150 million after government incentives to buy the refinery, plus $100 million for upgrades.

Many pundits doubted that an airline could successfully operate a refinery that struggled as part of a major refining company. However, Delta's management saw the deal as a cheap, relatively low-risk way to protect itself against swings in refining margins that can drive up the price of jet fuel at times.

Delta bought a refinery in 2012 to hedge against volatile refining margins. Image source: Delta Air Lines.

The Trainer refinery has had a mixed track record under Delta's ownership. Changes in the structure of the oil market and rising environmental compliance costs have made the refinery less profitable than the airline had projected. (Back in 2012, Delta said the refinery would earn $300 million annually. It nearly hit that figure in 2015, but hasn't come close since.)

On the other hand, owning the refinery has insulated Delta from elevated refining margins during periods of disruption, such as after Hurricane Harvey in late 2017. The refinery posted operating income of $110 million in 2017 and $58 million in 2018, before swinging to a $34 million loss in the first quarter of 2019.

The refinery's economics just improved

East Coast refining margins jumped by several cents following the explosion at the Philadelphia Energy Solutions refinery. While there is plenty of infrastructure to move more refined products to the Northeast by pipeline and ship, the uptick in refining margins in the region is unlikely to disappear completely anytime soon.

Furthermore, Philadelphia Energy Solutions' refinery lacked the capability to blend biofuels into its products, forcing it to buy renewable credits instead. Delta's Trainer facility is in the same position. With Philadelphia Energy Solutions shutting down, Delta's Monroe Energy unit will face less competition for buying these renewable credits, which should reduce its costs.

The Trainer refinery processes about 185,000 barrels of oil per day. That works out to nearly 3 billion gallons annually. Thus, an increase in refining margins of as little as $0.04 per gallon would boost the refinery's annual operating profit by more than $100 million, a significant sum.

Will this help Delta find a partner?

Since last fall, Delta has been looking for a strategic partner to buy a stake in the Trainer refinery. Given that it only needs jet fuel for its airline business -- not all of the other products the refinery produces -- finding a partner to deal with the rest of the refinery's output would make sense.

So far, Delta hasn't been able to close a deal. The company has even explored selling the refinery entirely, according to Reuters -- although executives have disputed that report.

Regardless of whether a sale or a joint venture is the ultimate goal, the Philadelphia Energy Solutions refinery closure will help Delta. Potential partners (or buyers) that may have been nervous about the Trainer facility's economics may be willing to take another look now, due to the more favorable competitive landscape. Despite the refinery's ups and downs over the years, Delta's bold move to enter the refining business is still on track to pay off in the long run.

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2019-06-29 16:14:00Z
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Newark airport reopens after 'emergency' shutdown over diverted United Airlines flight - Fox News

Newark Liberty International Airport (EWR) reopened on Saturday morning after an "airport emergency” shut down all air traffic at the New Jersey air hub for almost one hour.

It has since been revealed that the shutdown followed the emergency landing of United Airlines flight 2098 from New York's LaGuardia Airport to Houston, a rep for the carrier confirmed to Fox News.

According to the spokesperson, "United flight 2098 experienced a mechanical issue upon takeoff and diverted to Newark Liberty International Airport. Our pilots reacted quickly to ensure the safety of the aircraft and our customers, who deplaned using deployed slides after landing."

"There are no reported injuries and we’re making alternate arrangements to get our customers to their final destination as soon as possible," the official told Fox News.

Reps for EWR announced the shutdown on Twitter at 8:46 a.m., urging travelers to “check with your carrier before coming to the airport.”

CHRISSY TEIGEN TAKES GRAVY THROUGH AIRPORT SECURITY, REVEALING ODD TSA LOOPHOLE

About an hour later, officials said that the airport was reopened, though passengers should “expect delays” and continue to check with their carriers for any updates, Fox 5 DC reports.

Witnesses tweeted that a United aircraft was seen on the tarmac surrounded by emergency vehicles, according to NJ.com.

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United flight 2098 departed New York’s LaGuardia Airport at 7:57 a.m. on Saturday and was soon diverted to EWR, as per LaGuardia’s website.

This is a developing story, check back for updates.

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2019-06-29 15:51:05Z
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Newark airport reopens after 'emergency' shutdown over diverted United Airlines flight - Fox News

Newark Liberty International Airport (EWR) reopened on Saturday morning after an "airport emergency” shut down all air traffic at the New Jersey air hub for almost one hour.

It has since been revealed that the shutdown followed the emergency landing of United Airlines flight 2098 from New York's LaGuardia Airport to Houston, a rep for the carrier confirmed to Fox News.

According to the spokesperson, "United flight 2098 experienced a mechanical issue upon takeoff and diverted to Newark Liberty International Airport. Our pilots reacted quickly to ensure the safety of the aircraft and our customers, who deplaned using deployed slides after landing."

"There are no reported injuries and we’re making alternate arrangements to get our customers to their final destination as soon as possible," the official told Fox News.

Reps for EWR announced the shutdown on Twitter at 8:46 a.m., urging travelers to “check with your carrier before coming to the airport.”

CHRISSY TEIGEN TAKES GRAVY THROUGH AIRPORT SECURITY, REVEALING ODD TSA LOOPHOLE

About an hour later, officials said that the airport was reopened, though passengers should “expect delays” and continue to check with their carriers for any updates, Fox 5 DC reports.

Witnesses tweeted that a United aircraft was seen on the tarmac surrounded by emergency vehicles, according to NJ.com.

FOLLOW US ON FACEBOOK FOR MORE FOX LIFESTYLE NEWS

United flight 2098 departed New York’s LaGuardia Airport at 7:57 a.m. on Saturday and was soon diverted to EWR, as per LaGuardia’s website.

This is a developing story, check back for updates.

CLICK HERE TO GET THE FOX NEWS APP

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https://www.foxnews.com/travel/newark-airport-reopens-emergency-shutdown

2019-06-29 15:36:49Z
52780323151546

Newark Airport reopens after 'emergency' shutdown - Fox News

Newark Liberty International Airport (EWR) reopened on Saturday morning after an "airport emergency” shut down all air traffic at New Jersey air hub for almost one hour.

Reps for EWR announced the news on Twitter at 8:46 a.m., urging travelers to “check with your carrier before coming to the airport.”

CHRISSY TEIGEN TAKES GRAVY THROUGH AIRPORT SECURITY, REVEALING ODD TSA LOOPHOLE

About an hour later, officials said that the airport was reopened, though passengers should “expect delays” and continue to check with their carrier for any updates, Fox 5 DC reports.

It remains unclear at this time why EWR was shutdown.

Witnesses tweeted that an aircraft, perhaps making an emergency landing, was seen on the tarmac surrounded by emergency vehicles, according to NJ.com.

FOLLOW US ON FACEBOOK FOR MORE FOX LIFESTYLE NEWS

United Airlines flight 2098 reportedly departed New York’s LaGuardia Airport at 7:57 a.m. on Saturday and was soon diverted to EWR, as per LaGuardia’s website.

This is a developing story, check back for updates.

CLICK HERE TO GET THE FOX NEWS APP

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https://www.foxnews.com/travel/newark-airport-reopens-emergency-shutdown

2019-06-29 14:25:34Z
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