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Marketplace with host Kai Ryssdal produced and distributed by American Public Media focuses on the latest business news both nationally and internationally, the global economy, and wider events linked to the financial markets.
The only national daily business news program originating from the West Coast, Marketplace is noted for its timely, relevant and accessible coverage of business, economics and personal finance.
Friday, December 6, 2013 6:11pm
Money is on our minds this time of year, between holiday spending and New Year's resolutions, many of us are geared up to cut where we can and start 2014 fresh. With that in mind, it's time to answer your money questions.
Joining Carmen today is CBS News business analyst Jill Schlesinger.
Suzanne from Boston, a long-time Money listener, lives with her husband who works at a tech startup. She's a resident in psychiatry, and graduated from medical school in 2011 with about $200,000 in student debt.
She currently makes about $60,000 a year and her husband makes more. They're both contributing to pay down her loans because her husband doesn't have any. She's enrolled in an income-based payment plan, so her payments are pretty small.
Suzanne is also enrolled in a public service loan forgiveness program that she's skeptical about. Allegedly, after 120 payments her student debt is forgiven. She wants to know if this is true, since the law was only enacted in 2007. Right now, she's paying the minimum payment every month, but interest is accruing like crazy. If the debt isn't really forgiven, she's going to have racked up a huge amount of debt.
Suzanne and her husband can contribute more to her student loans, should they? Her residency is 5 years, after which she hopes to continue working in a non-profit -- but her salary will likely double.
The Public Service Loan Forgiveness program does exist, but it comes with a few caveats. "Qualifying employment is any employment with a federal, state, or local government agency, entity, or organization or a not-for-profit organization that has been designated as tax-exempt by the Internal Revenue Service (IRS) under Section 501(c)(3) of the Internal Revenue Code (IRC)," which Jill Schlessinger notes is "pretty much every hospital out there."
"The reality is if you see yourself continuing to work, you're going to have your residency and then maybe you're going to be an attending physician ... then it should work," Schlessinger says. Carmen adds it's also important that these loans are federal, as the forgiveness program only covers federal loans.
"What you need to do is head to the administrative offices of the hosopital you are at, and talk to them about what you need in terms of paper work and information and make sure you qualify for this program," Carmen says.
To hear more advice on how to reduce day-to-day spending and other listener questions, click the play button above.
Friday, December 6, 2013 6:06pm
As President of South Africa, Nelson Mandela faced an uphill battle to rebuild the country’s economy after economic sanctions were imposed by other countries protesting the apartheid government. His success varied.
“He began a process that saw South Africa achieve the longest period of its economic growth – for 15 years” says Buntu Williams, a BBC business reporter based in Johannesburg.
The only slowed in 2008 when the financial crisis hit. And even now in South Africa, Mandela remains a prominent figure when it comes to the economy because “most of the policies that would follow were really developed in the time that he was president.”
But inequality is still a problem in South Africa.
When Mandela came to power, the average white household earned nine times what the average black household earned. Today, the average white household earns six times more than a black one.
Mandela’s policies were often hindered by South Africa’s weak economy and lack of funds says Williams. But Mandela never attempted to nationalize private businesses as other left-leaning leaders have done.
“At the center of it all was to ensure white South Africans in particular and also to ensure black that South Africa’s problems were going to be negotiated. That there was going to be peace, that the country wouldn’t fall into chaos.”
Williams says South African markets haven’t moved much since news of Mandela's death. He attributes it to the respect South Africans feel towards Mandela.
Friday, December 6, 2013 4:55pm
We get way more questions than we could ever hope to answer, so that's why we created the lightning round. Five minutes of personal finance, and we're tackling questions about gifts, donations ... a bit of holiday spirit in the shape of stocks, bonds, IRAs, and college savings. This week, we're joined by Ben Johnson, host of Marketplace Tech.
Gene says his girlfriend recently set up a brokerage account, and he wants to give her a hundred shares of a stock we both invest in as a gift. Are there any taxes associated with giving a gift of stock? The current market value of the stock would put it at around $2000.
Carmen: "First of all, diversify and not just own one stock. Beyond that, there are some tax implications on financial gifts, but the max for 2013 is actually $14,000 before you have to report it to the tax man. So that's your exclusion. For information on 2014 and beyond, check out irs.gov."
Erin through our Facebook asks, "What's the best type of account or best way to set one up so family members can contribute to it?"
Carmen: "That would be a 529. Those 529's, consider those the IRAs for college education. And not only can multiple family members put money in there, but should that child not use the money [and] there's a sibling, the sibling gets to use the money. Go to savingforcollege.com for free info."
Aries wants to know what's the best way to give a college fund to her brother's kids?
Carmen: "Open a 529. Family members can open a 529 for other folks. So that is awesome. And if you start it, you can even ask the rest of the fmaily every year, that instead of buying, you know more plastic stuff, that they could actually put more money in that account. But you want to make sure that if they already have a college fund, that you talk to them about it and see what form it is. If they don't have a 529 and you don't want to open one either, just send them a check and say: 'Please put this into the college account.'"
Also from Facebook, Jennifer says her 11 year old son wants to get to know investing. She's thought about giving him a penny trading account with $100 in it, but doesn't know if that would really help him learn. Getting him one or two shares of a stock he likes would work, but what if it tanks? What's the best holiday gift to help a young'un learn something mama doesn't already know how to do?
Carmen: "You don't have to have money invested to learn how to invest. What you want to do is make sure he just has the basics ... you want to make sure that you also have him understand cash, credit, banking accounts, all of that stuff as well. If you want to fiddle around and you want to play around on the market but you don't want to risk real money, Marketwatch from wsj has a virtual stock exchange."
Friday, December 6, 2013 4:31pm
This final note today: in which we see the future...
And it's us.
Electronic money has been used to buy an electronic car. The Lamborghini dealership in Newport Beach, California announced this week somebody came in and bought a Tesla using Bitcoin.
Sticker price on a Telsa S is about $95,000. At today's rate of exchange that's about 108 bitcoins. Though it's worth a note that bitcoins have lost 30 percent of their value the past two days...
So there's that.
Friday, December 6, 2013 2:25pm
Heidi Moore from the Guardian and the Wall Street Journal's Sudeep Reddy recap the week in news. The economy added 203,000 jobs this month with the unemployment rate down to 7 percent, its lowest point in 5 years.
Heidi and Sudeep share their suggested #longreads for the weekend:
There are places in this world that only reporting, and not commentary, can take you. A lot of commentators, from banks CEOs to TV pundits, have a lot of feelings about the Fed's easing programs. But Carrick Mollenkamp, a reporter for Reuters, gets to the real-world truth of what that means, like workers struggling financially while their companies' financial backers make substantial profits. This is a must-read story of the real-world consequences of Wall Street and finance.
Nelson Mandela died this week, and as when any great man passes, there have been tributes both beautiful and mawkish. This great piece by Peter Beinart reminds us of the history that can get swept under the rug: that Mandela, now universally seen as a hero, was once labeled a terrorist and lawbreaker by the U.S. government. Nothing looks more misguided in hindsight. The one big lesson of his life might be that there's a right side to history, and it's no easy matter to identify it early and stick to the principles that make resistance to a popular idea necessary. That's helpful to remember in this age when everyone from intelligence agencies to financial firms work hard to make their agendas the lasting ones.
Thomas Frank has a wonderful, devastating think piece in Harper's about the real-life consequences of the minimum wage. "Let me tell you about this one stretch of Hillsborough Road in Durham, North Carolina," he starts, and if you're hooked there, you'll find every other sentence just as compelling. The best part is the tone -- conversational, compelling, but never tendentious or lecturing. Sit with it this weekend.
The inventor of karaoke is a global superstar zillionaire, right? No, Daisuke Inoue never patented the device. His story will make you cry, or maybe sing.
Still in the realm of songs, the famous “Free Nelson Mandela” was written by someone who at first had never heard of Nelson Mandela, author Dorian Lynskey found.
We’ve heard about Edward Snowden for months. How he engaged with Glenn Greenwald, as told in one sitting by Janet Reitman in Rolling Stone, will show you how he influenced the course of spying and the intelligence beat.
September 23, 2013