The History of Currency

 

9000 BC LIVESTOCK

To Barter or Not  to Barter

Contrary to popular belief, the idea that bartering pre-dates the invention of other forms of currency is now seen as unlikely. 1 The reason? Bartering is extremely inefficient. Historically, people have  engaged in a barter economy as a supplement to other  forms of payment.

With the rise of agriculture, other animals like cattle, sheep, camels and other livestock, along with sacks of grain were used as a traditional "stores of value".  Cattle were even called as "capitale" in latin, which is where we get the word "capital".2

1300 BC COWRIE SHELLS

Cowrie shells are the small, colorful shells of a certain type of sea snail found in the Pacific and Indian Oceans, and have been used as currency all over the world. Individually or strung on necklaces, they represented everything useful in a currency: small, divisible, and durable.3

700-600 BC COINS

Alternative Shapes

Besides the lumps of gold and silver in Turkey, the earliest coins took on shapes of knives and  spades.4

The first coins were put into use in seventh century Turkey. Not exactly round, they were small lumps of a gold and silver micture called electrum, often stamped with a pattern on one side.  Despite their irregular shapes, early coins were held to a strict  weight standards.5

600 AD PAPER GOODS

In addition to the first paper money, China also invented  the first "banknotes," made of leather. One foot square decorated with patterns and a fringed border, princes were required to purchase these notes at a price of 400,000 copper coins, and to present gifts to the emperor on them.6

The Tang Dynasty of China was the one to put paper money into use, nearly 500 years before it caught on to Europe. But early experiments were not without pitfalls,: china went through financial crisis when the  paper money production grew until its value bottomed out, causing massive inflation.7

1800 THE GOLD STANDARD

Through the Nose

The phrase "through the nose" has its origin in ninth century Ireland. when the Danes conquered the island, they took census by "counting noses"  imposing high taxes on each "nose."8

Britain was the first country to adopt the gold standard as the fixed value of their currency.  Germany, France and the U.S. followed suit in 1870s. By 1937, in the wake of the Great Depression, not a single country remained fully on the gold standard, and in 1971, the U.S. fully suspended it.9

CITATIONS:

1. AntheoEncyclopedia.com 2020

2.Scholastic.com 2021

3.NMMuseum.be 2021

4.Money.org 2021

5.Ancient.eu 2015

6.ForumScienceCoins.com accessed 2021

7.Time.com 2021

8.Grammarlist.com 2021

9.Britannica.com 2021

We may be reached at 800-916-9860

www.wenadvisory.com

This material does not necessarily represent the views of the presenting party, nor their affiliates. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

  

How Boomers and Millenials Differ

 

We are in the midst of an unprecedented transfer of wealth, with trillions of dollars being moved from one generation to the next. This transfer challenges many commonly held notions as new values and interests become more prominent. In short, the economy is changing, and while some of these new practices might raise an eyebrow or two, not all of these ideas are without merit.

For someone from the boomer generation, it might be easy to become upset with or confused by millennials' differing points of view. However, taking note of the differences between the two generations can foster better communication and understanding.

The younger generations, including millennials, Gen Z, zoomers, and whatever else you call them, have a different perspective on wealth than their forebears. As these generations reach middle age, an interesting trend has emerged in emphasizing YOLO (You Only Live Once). Now that these generations have the steering wheel, they seem to be stepping on the gas and running full force into exciting, once-in-a-lifetime experiences.

At this point, it bears looking at the “why” of the YOLO economy. In other words, why do these forty-somethings spend as if there is no tomorrow?

Less money: Your average 40-year-old earns about $49,000 a year. While this is more than the 40-year-olds of the previous generation, the rising cost of living has taken a significant bite out of that difference.1

Less control: This generation also holds a smaller piece of the pie. While the post-WWII cohort controlled 22 percent of wealth in the United States once it reached middle age, millennials only controlled seven percent.2

Perhaps the biggest factor is less marriage: Middle-aged millennials are less likely to be married or start families than prior generations. Only 44 percent of millennials have walked down the aisle by age 40, compared to 61 percent for Generation X and 53 percent for baby boomers. Only 30 percent of millennials live with a spouse and at least one child, far lower than prior generations. This means that the expenses that come with a family are also off the table. If you aren’t married, the costs of a possible divorce are simply gone. Without children, you don’t have to pay for school clothes each fall, braces, and everything else that comes with helping a child grow up.3

The result is a very different economic picture for today’s middle-aged individuals. Consequently, all of these differences have informed a different set of values. Among millennials, 78 percent prefer spending money on experiences rather than material things. While prior generations may have placed more importance on things like home ownership, car purchases, and investments, millennials are looking at a different future with disparate priorities. For these reasons, spending on travel, exclusive events, and entertainment has become a priority.4

Of course, many boomers today find themselves in similar situations as middle-aged millennials. Most of the boomer generation is in their retirement, with their children growing and perhaps finding themselves needing further stimulation in their golden years. While many keep working part-time, start businesses, or help their families with childcare, there may be a pang of that YOLO spirit in them as well, and a similar yearning for adventure.

And for good reason. While their middle-age experiences may have been very different, there is no better time than now to take that big trip you’ve always thought about. Maybe it’s time to splurge on those expensive concert tickets or challenge yourself through a special adventure that always seemed impractical, like learning to SCUBA dive or skydive.

This might be too far for some, but it’s important to remember that wealth can serve us in two ways: providing security and allowing us to enjoy life. If you’ve been working hard with your financial professionals to pursue that security, maybe it’s time to talk to them about your need for enjoyment.

It’s also possible that the younger people in your family have done too much YOLO and not enough saving and investing. A conversation with a trusted financial professional may help them understand how to balance living for today and preparing for tomorrow.

CITATIONS

1. Businessinsider.com, February 22, 2023
2. Fortune.com, March 22, 2023
3. Pewresearch.org, October 19, 2023
4. Harris Interactive, October 19, 2023

We may be reached at 800-916-9860

www.wenadvisory.com

This material does not necessarily represent the views of the presenting party, nor their affiliates. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

Five Most Overlooked Tax Deductions

 

Who among us wants to pay the IRS more taxes than we have to?

While few may raise their hands, Americans regularly overpay because they fail to take tax deductions for which they are eligible. Let’s take a quick look at the five most overlooked opportunities to manage your tax bill.

1. Reinvested Dividends: When your mutual fund pays you a dividend or capital gains distribution, that income is a taxable event (unless the fund is held in a tax-deferred account, like an IRA). If you’re like most fund owners, you reinvest these payments in additional shares of the fund. The tax trap lurks when you sell your mutual fund. If you fail to add the reinvested amounts back into the investment’s cost basis, it can result in double taxation of those dividends.1
   Mutual funds are sold only by prospectus. Please consider the charges, risks, expenses, and investment objectives carefully before investing. A prospectus containing this and other information about the investment company can be obtained from your financial professional. Read it carefully before you invest or send money.
2. Out-of-Pocket Charity: It’s not just cash donations that are deductible. If you donate goods or use your personal car for charitable work, these are potential tax deductions. Just be sure to get a receipt for any amount over $250.2
3. State Taxes: Did you owe state taxes when you filed your previous year’s tax returns? If you did, don’t forget to include this payment as a tax deduction on your current year’s tax return. There is currently a $10,000 cap on the state and local tax deduction.3
4. Medicare Premiums: You may be able to deduct unreimbursed medical and dental premiums, co-payments, deductibles, and other medical expenses to the extent that the costs exceed 7.5% of your adjusted gross income. This includes most Medicare premiums.4
5. Income in Respect of a Decedent: If you’ve inherited an IRA or pension, you may be able to deduct any estate tax paid by the IRA owner from the taxes due on the withdrawals you take from the inherited account.5

CITATIONS

1. Investopedia.com, January 11, 2024
2. IRS.gov, 2024
3. IRS.gov, 2024
4. IRS.gov, 2024
5. IRS.gov, 2024. In most circumstances, once you reach age 73, you must begin taking required minimum distributions from a Traditional Individual Retirement Account (IRA). Withdrawals from Traditional IRAs are taxed as ordinary income and, if taken before age 59½, may be subject to a 10% federal income tax penalty. You may continue to contribute to a Traditional IRA past age 70½ as long as you meet the earned-income requirement.

We may be reached at 800-916-9860

www.wenadvisory.com

This material does not necessarily represent the views of the presenting party, nor their affiliates. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

Do Your Kids Know The Value of a Silver Spoon?

 

You taught them how to read and how to ride a bike, but have you taught your children how to manage money?

The average debt for student borrowers is $40,499. And nearly 11% of new graduates will default within the first twelve months of repayment.1,2

For current college kids, it may be too late to avoid learning about debt the hard way. But if you still have children at home, save them (and yourself) some heartache by teaching them the basics of smart money management.

Have the conversation. Many everyday transactions can lead to discussions about money. At the grocery store, talk with your kids about comparing prices and staying within a budget. At the bank, teach them that the automated teller machine doesn’t just give you money for the asking. Show your kids a credit card statement to help them understand how “swiping the card” actually takes money out of your pocket.

Let them live it. An allowance program, where payments are tied to chores or household responsibilities, can help teach children the relationship between work and money. Your program might even include incentives or bonuses for exceptional work. Aside from allowances, you could create a budget for clothing or other items you provide. Let your kids decide how and when to spend the allotted money. This may help them learn to balance their wants and needs at a young age when the stakes are not too high.

Teach kids about saving, investing, and even retirement planning. To encourage teenagers to save, you might offer a match program, say 25 cents for every dollar they put in a savings account. Once they have saved $1,000, consider helping them open a custodial investment account, then teach them how to research performance and ratings online. You might even think about opening an individual retirement account (IRA). Some parents offer to fund an IRA for their children as long as their children are earning a paycheck.3

As you teach your children about money, don’t get discouraged if they don’t take your advice. Mistakes made at this stage in life can leave a lasting impression. Also, resist the temptation to bail them out. We all learn better when we reap the natural consequences of our actions. Your children probably won’t be stellar money managers at first, but what they learn now could pay them back later in life – when it really matters.

CITATIONS

1. EducationData.org, August 20, 2023
2. EducationData.org, August 27, 2023
3. Once you reach age 73 you must begin taking required minimum distributions from a Traditional Individual Retirement Account in most circumstances. Withdrawals from Traditional IRAs are taxed as ordinary income and, if taken before age 59½, may be subject to a 10% federal income tax penalty. Contributions to a Traditional IRA may be fully or partially deductible, depending on your adjusted gross income.

We may be reached at 800-916-9860

www.wenadvisory.com

This material does not necessarily represent the views of the presenting party, nor their affiliates. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

Unlocking the Treasures of Financial Wellness

 

While finances and health may seem unrelated, the two are often closely intertwined, especially in America’s bustling, free-flowing marketplace. Will the nation’s economy gather momentum in the years ahead? Will Americans continue to improve their personal balance sheets as the country moves forward?

First, let’s take a look at the financial facts by the numbers: 

• $67,521: the median income of an American household.1 

• $145,000: the average American household debt.2 

• $2,581: the average charitable contribution of general-population households.3 

• 697: the average American’s credit score.4 

• $106,478: the average American’s 401(k) balance. 5 

• 8.9%: the average 401(k) contribution rate as a percentage of salary.6 

• 35.3%: the percentage of US households that own a tradition or Roth IRA account.7 

• $1,657: the average American’s monthly social security retirement benefit.8 

• 40%: the percentage of the average worker’s income that social security was designed to replace.9 

Second, let’s examine two of the largest lifetime expenditures: retirement and health care. The general rule for retirement income is to have 70-80% of your working income available. However, some analysts say you should hit 100% of your annual working income levels during at least the first few years of retirement. Generally, spending habits don’t significantly change during retirement. Some expenses may decline while others, such as traveling costs, may increase.10,11

While the average retirement lasts 19 years for men and 21.6 years for women, married couples may fare better: at least one person, on average, is likely to make it to age 93. That could be 30 years or more, depending on the age at which you and your spouse retire.12 With annual U.S. health-care costs rising to $4.1 trillion, the industry consumes nearly 20% of the U.S. gross domestic product. What does that mean for the average retiree?13 A healthy couple retiring at the age of 65 can expect to pay nearly $208,000 out of pocket for health care expenses throughout the course of their retirement. This figure does factor in Medicare insurance, which takes effect at 65.14 One way you can prepare for future health care costs is by taking advantage of tools designed to help you prepare for them, such as a health savings account (HSA). An HSA is a type of tax advantaged savings account that can be used to pay for medical, dental, and vision care as well as prescription drugs. Keep in mind that once you start Medicare, you can no longer contribute pre-tax dollars to your HSA. If you were to withdraw money from your HSA for a non-medical reason, that money becomes taxable income and you face an additional 20% penalty. After age 65, you can take money out without the 20% penalty, but it still becomes taxable income.15 What about those who aren’t retired or anywhere near retirement? The average individual health insurance premium is about $450 a month, and premiums for families are about $1,157. What about deductibles? Under individual plans, they amount to around $4,490, and for families, they are about $8,440. How about by age? The average monthly premiums for different age groups are as follows: $224 for those under 18, $267 for 18–24 year olds, $318 for 25–34 year olds, $391 for 35–44 year olds, $529 for 45–54 year olds, and $771 for 55–64 year olds.16 

What do you do if your financial health needs some exercise? How do you create a strong bottom line to prepare for an uncertain financial future? 

LEARN LEARN LEARN

The first step in creating financial wellness is to gain knowledge. Knowledge is power—the power to build robust financial health. Some employers, organizations, and communities offer financial wellness programs. If such programs are available to you, consider signing up. The more you know, the better. The financial world can be complex and confusing. Understanding where the opportunities lie and how to make your way through the muddle of money management may give you a distinctive edge. If your employer doesn’t have a program, develop or find one of your own. Do the research. Remember, getting yourself a financial education may set you in the right direction. However, the most valuable, reliable, and up-to-date information may come from a financial professional who can help you with financial wellness programs on budgeting, debt management, and retirement strategies. It’s never too late to chart your course to financial wellness.

SAVE SAVE SAVE  

Part of goal setting is saving. Saving a portion of your income helps you develop financial discipline and allows you to envision your future more clearly. Saving also applies to—but is not exclusive to— preparing for your retirement. Saving helps keep you smooth and steady on life’s path through emergencies and unexpected twists and turns. It also helps you develop your ability to focus on both your short-and long-term goals, as opposed to meeting only your immediate needs. If your company provides a retirement plan, consider participating in it. Contributions to tax-deferred retirement plans indirectly help foster the budget discipline that may help you in the future.

GET PROFESSIONAL HELP

Consult with a financial professional. Professionals can provide insight and direction and help you develop a more disciplined approach to managing your personal finances. They can also provide you with the tools to paint your vision of a prosperous future.

SOURCES: 1. Census.gov, 2021 2. Debt.org, 2022 3. MarketWatch.com, 2021 4. Forbes.com, 2021 5. BusinessInsider.com, 2021 6. Investopedia.com, 2021 7. ICI.org, 2021 8. USNews.com, 2021 9. Investopedia.com, 2021 10. MoneyCrasher.com, 2022 11. BusinessInsider.com, 2021 12. Fidelity.com, 2021 13. CMS.gov, 2021 14. HVSFinancial.com, 2021 15. Investopedia.com, 2021 16. EHealthInsurance.com, 2021 17. Investopedia.com, 2021 18. NerdWallet.com, 2022

We may be reached at 800-916-9860

www.wenadvisory.com

This material does not necessarily represent the views of the presenting party, nor their affiliates. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

Four Really Good Reasons to Invest

 

Forty-two percent of Americans do not own any stocks or stock-related investments, according to a recent Gallup poll.1

Individuals may cite different reasons for not investing, but with important long-term financial goals, such as retirement, in the balance, the reasons may not be good enough.

Why Invest?

Make Money on Your Money

You might not have a hundred million dollars to invest, but that doesn't mean your money can't share in the same opportunities available to others. You work hard for your money; make sure your money works hard for you.

Achieve Self-Determination and Independence

When you build wealth, you may be in a better position to pursue the lifestyle you want. Your life can become one of possibilities rather than one of limitations.

Leave a Legacy to Your Heirs

The wealth you pass to the next generation can have a profound impact on your heirs, providing educational opportunities, the capital to start a business, or financial support to your grandchildren.

Support Causes Important To You

Wealth can be an important tool for impacting the world in a meaningful way. So whether your passion is the environment, the arts, or human welfare, you can use your wealth to affect positive changes in your community or around the world.

A Framework for Investing

The decision to invest is an acknowledgment that it comes with certain risks. Not all investments will do well, and some may lose money. However, without risk, there would be no opportunity to potentially earn the higher returns that can help you grow your wealth.

To manage investment risk, consider maintaining a broad diversification of your investments that reflects your personal risk tolerance, time horizon, and the nature of your financial goal. Remember, diversification is an approach to help manage investment risk. It does not eliminate the risk of loss if security prices decline.

Because investing can be complicated, consider working with a financial professional to help guide you on your wealth-building journey.

CITATIONS

1. Gallup.com, May 12, 2022

2. Freepik for the image

We may be reached at 800-916-9860

www.wenadvisory.com

This material does not necessarily represent the views of the presenting party, nor their affiliates. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

New Retirement Contribution Limits for 2024

 

The Internal Revenue Service (IRS) has released new limits for certain retirement accounts for the coming year.

Keep in mind that this update is for informational purposes only, so please consult with an accounting or tax professional before making any changes to your 2024 tax strategy. You can also contact your financial professional, who may be able to provide you with information about the pending changes.

Individual Retirement Accounts (IRAs)

Traditional IRA contribution limits are up $500 in 2024 to $7,000. Catch-up contributions for those over age 50 remain at $1,000, bringing the total limit to $8,000.

Remember, once you reach age 73, you must begin taking required minimum distributions from a Traditional IRA in most circumstances. Withdrawals are taxed as ordinary income and, if taken before age 59½, may be subject to a 10% federal income tax penalty.

Roth IRAs

The income phase-out range for Roth IRA contributions increases to $146,000-$161,000 for single filers and heads of household, an $8,000 increase. For married couples filing jointly, the phase-out will be $230,000-$240,000, a $12,000 increase. Married individuals filing separately see their phase-out range remain at $0-10,000.

To qualify for the tax-free and penalty-free withdrawal of earnings, Roth 401(k) distributions must meet a five-year holding requirement and occur after age 59½. Tax-free and penalty-free withdrawal can also be taken under certain other circumstances, such as the owner's death.

Workplace Retirement Accounts

Those with 401(k), 403(b), 457 plans, and similar accounts will see a $500 increase for 2024, the limit rising to $23,000. Those aged 50 and older will continue to have the ability to contribute an extra $7,500, bringing their total limit to $30,500.

Once you reach age 73 you must begin taking required minimum distributions from your 401(k) or other defined-contribution plans in most circumstances. Withdrawals are taxed as ordinary income and, if taken before age 59½, may be subject to a 10% federal income tax penalty.

SIMPLE Accounts

A $500 increase in limits for 2024 gives individuals contributing to this incentive match plan a $16,000 stoplight.

Much like a traditional IRA, once you reach age 73, you must begin taking required minimum distributions from a SIMPLE account in most circumstances. Withdrawals are taxed as ordinary income and, if taken before age 59½, may be subject to a 10% federal income tax penalty.

As a reminder, this article is for informational purposes only. Consult with an accounting or tax professional before making any changes to your 2024 tax strategy.

We may be reached at 800-916-9860

www.wenadvisory.com

This material does not necessarily represent the views of the presenting party, nor their affiliates. All information is believed to be from reliable sources; however we make no representation as to its completeness or accuracy. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.