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IN THIS ISSUE: A salary speedbump, home equity loans, and smart ways to save |
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THE HEADLINES
Stuck in the middleWhat’s happening: About 25% of midcareer professionals go at least 5 years without a raise or significant promotion, according to research from New York University’s School of Professional Studies and the Burning Glass Institute.1 This could have a long-lasting impact on finances, even affecting retirement savings. |
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Here’s why: Although the job market has picked up this year, hiring trends remain relatively subdued and some major companies have laid off staff. This could be preventing workers from moving up or jumping to better-paying jobs.
What it means for you: Strengthening skills like public speaking and time management could help reduce the risk of a stall, says the study.
Continuing education—which may be covered in part by your employer—could
also help you make a career pivot and stop a stall. Plus, there are ways you could make more money without switching
jobs—get 10 ideas.
Not facing a career stall? If your income is rising, here are 5 moves to help maximize peak earning years. |
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Care packageWhat happened: Washington state just became the first in the US to institute a state-operated program for long-term care insurance. It helps cover services like home health aides and nursing home stays.
Here’s why: More than half of Americans will need long-term care, according to the Department of Health and Human Services, and it’s pricey.2 The yearly median cost of a nonmedical caregiver is about $80,000.3 Yet only 3% of Americans older than age 50 have long-term care insurance, according to LIMRA, the Life Insurance Marketing and Research Association.4
What it means for you: Medicare doesn’t cover nonmedical long-term care. So unless you’re in Washington, consider learning about your long-term care options and
6 ways to pay for long-term care. Need more guidance? A Fidelity pro could help you create a long-term care plan. |
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Home stretchWhat happened: This year, homeowners took out the most equity in the first 3 months since early 2021, according to a new report from Intercontinental Exchange, a financial markets technology and data company.5 Home equity lines of credit (HELOCs) and home equity loans accounted for the majority of the withdrawals.
Here’s why: Homeowners with low mortgage rates might want to access cash from equity without giving up their loan.
What it means for you: Pros caution against taking loans for everyday living expenses—it could signal you’re spending more than you can afford. (Psst … here are
5 ways to keep that in check.) You’re better off tapping emergency savings. Generally, borrowing against home equity should fund expenses that can raise your home’s value or reduce your home insurance costs. These can include home upgrades, repairs, and maintenance.
Also, consider that if the Federal Reserve keeps interest rates high or raises them, your monthly payment on a home equity line could balloon and push you further into debt. Learn more about when and why to tap home equity and which type might work best for your situation. |
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HOW TO
Trick your brain into saving moreThese 3 painless ideas could lead to big wins. |
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QUICK Q
Should I open an IRA if I already have a 401(k)?An individual retirement account (IRA) could help you save more for retirement outside of an employer-sponsored plan, such as a 401(k) or 403(b), because you could:
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Contribute to a 401(k) and an IRA at the same time. They each have separate annual contribution limits that don’t count against each other. (Check out these 6 ways to max out your retirement savings.)
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Gain access to a potentially wider range of investment choices than your employer-sponsored plan.
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Take advantage of potential tax-deferred growth and potential tax-free withdrawals depending on the type of IRA you choose.
Pro tip: Consider contributing enough to your 401(k) to get your full employer match before contributing to an IRA.
Read more about investing for retirement with a 401(k) and Roth IRA. Then consider which type of IRA might be right for you. |
