Day: March 23, 2020

Jonathan Burton's Life Savings: Workers need full access to 401(k) and IRA retirement savings now to combat coronavirus hit

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The coronavirus threat to Americans is massive, and so will be the resulting economic hit. You’re going to need enough cash to cover monthly living expenses for the next year, at least.

To help millions of Americans weather this crisis, Congress should immediately waive early withdrawal penalties and income taxes for all 401(k) retirement plans, for amounts up to $25,000 over the next 12 months, after which the waiver would sunset or be renewed. Early withdrawal penalties and income taxes for traditional IRAs should also be waived, up to $25,000, again with a 12-month sunset.

Currently, if you’re under age 59 1/2, money taken from a 401(k) or traditional IRA is taxed as ordinary income, as if you earned it on the job, and subject to an additional 10% penalty. This includes withdrawals due to financial hardship and job loss — inevitabilities of the coming coronavirus recession. Already the Dow Jones Industrial Average DJIA, -3.04% is down 37% from its February peak, and American jobs are at risk.

Over the coming year, Americans could face an economic tsunami possibly more devastating than the 2008-09 Great Recession. Full, unobstructed and temporary access to retirement savings will help them stay afloat if and when U.S. unemployment hits Great Depression levels.

Read: Cash is the coronavirus vaccine we need now

Financial advisers and other retirement experts will protest loudly, saying that such a waiver irresponsibly encourages people to sell securities at the bottom of the market and jeopardizes their retirement.

In normal times, that would be true. This waiver goes against the explicit mandate of employer-sponsored and individual retirement plans — make it difficult to withdraw money so people are forced to save. But desperate times require desperate measures. The editorial board of The Wall Street Journal, a sister publication to MarketWatch, recently endorsed this idea, saying that “a limited period of allowing free-and-clear withdrawals would encourage parents, brothers, uncles and so forth to act as a financial backstop to younger and less-fortunate family.”

Emergency access to retirement savings isn’t a ticket to buy a new car or take a vacation — it’s cash in the bank for food, rent, utilities, mortgage and other necessities as American society faces an economic challenge it hasn’t endured since the 1930s. The coronavirus contraction could put as many as 30% of Americans out of work, Federal Reserve Bank of St. Louis President James Bullard predicts. Without this waiver, millions of Americans will be unemployed or under-employed, and any cash in their 401(k) will be languish untapped, used only as a last resort. 

Unfortunately, not every American can get this help; only about half of U.S. workers participate in 401(k) or other defined-contribution plans. Even then, most people haven’t saved nearly enough to fund a comfortable retirement. For example, the average 401(k) balance among Americans aged 50-59 — after their peak earning years and on the cusp of retirement — is $174,000, according to recent research from investment-management giant Fidelity Investments. 

Read: You may not have as much in your 401(k) for retirement as you think

Show us the money. Congress already is considering a form of Universal Basic Income — a one-time $1,200 check for most adults and $500 for children is on the table as part of a contentious $2 trillion economic stimulus proposal. Congress also should include a waiver for early retirement-plan withdrawals to any rescue package, knowing that such action will give working Americans greater financial leverage to combat the crisis and help recirculate cash into strapped businesses up and down Main Street.

Tax- and penalty-free retirement-plan withdrawals will help all non-retired Americans, but families in their 30s and 40s — people who will have many decades to recover from this crisis — would be especially relieved. Americans in their 30s have about $42,000 on average in 401(k)s, while those in their 40s have about $102,000. Withdrawing $25,000 will not destroy anyone’s retirement, but it will give many Americans financial security from whatever economic disaster is coming so they can survive to invest another day.

Read: The Fed is going to buy ETFs. What does it mean?

More: Fed is now effectively the ‘lender of last resort’ to Main Street; not just Wall Street

Jonathan Burton is a MarketWatch editor and columnist.

Personal Finance Daily: How much exercise is OK during the coronavirus pandemic? and in Paris, the French scramble to make sense of a chaotic situation — with paperwork

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Hi there, MarketWatchers. Stay safe and don’t miss these top stories:

Personal Finance
How much exercise is OK during the coronavirus pandemic? What’s too risky?

Both too much and too little exercise are bad for you.

Zillow and Redfin are pausing home-buying — could the coronavirus pandemic make the iBuyer model more popular?

As home sales screech to a halt, home-buying companies will face massive expenses.

‘All they care about is making money.’ Can my supermarket manager force me to remove my face mask at work?

‘Wearing the mask makes me feel safer and helps to guard me against coronavirus. It does not interfere with my ability to do my job.’

In Paris, the French scramble to make sense of a chaotic situation — with paperwork

The lockdown reflects not only France’s unique relationship with bureaucracy, but also its disdain for overreaching authority.

There are 382,000 job openings and counting as Amazon, Walmart, Domino’s and more hire to meet coronavirus demand

The number of jobless claims rose by 70,000 last week, but several sectors are ramping up hiring even as the coronavirus pandemic creates layoffs.

What the Families First coronavirus relief bill means for small-business owners and self-employed people

The Families First Coronavirus Response Act requires paid leave for small-business employees affected by coronavirus and includes tax relief for employers.

Send us your photos of life during the coronavirus pandemic

MarketWatch wants to see your most compelling photos — but please don’t put yourself at risk.

CVS receipts and wet wipes as toilet paper? People are flushing all the wrong alternatives during coronavirus shortage

Creative personal hygiene solutions are apparently one side effect of the social distancing and work-from-home contingencies deemed necessary to slow the deadly COVID-19 pandemic.

IRS removes cap on the amount of taxes that can be deferred until July 15

The government agency also clarified that the rules extending filing and payment dates for people and businesses also apply to estates.

‘This is such a blatant disregard for the coronavirus advice from the CDC.’ Can my employer force me to go to work?

‘We still have quite a bit of foot traffic throughout the building.’

Elsewhere on MarketWatch
California police chief to Trump administration: ‘Stop testing NBA players, and start testing our first responders’

Police departments are also struggling during the coronavirus pandemic, law enforcement agencies tell the White House.

Gas prices could soon drop to 99 cents a gallon in parts of the U.S.

As the coronavirus crushes demand for gasoline, prices are plunging all over the country.

Trump team is weighing whether coronavirus-induced shutdown is doing ‘more harm than good’

How much damage can be inflicted on the U.S. economy to try to stop the coronavirus from killing more people? The Trump White House is increasingly asking the question — and the answer could have grave implications for the health and livelihood of all Americans.

Chicago is turning empty hotel rooms into temporary coronavirus isolation spaces — other cities should do the same

It also gets hotel employees back to work.

These small-business owners made their dreams come true — and then the coronavirus hit

MarketWatch spoke to four small-business owners about how they’re coping and adapting.

Commodities Corner: Fed move awakens gold, just as supply of the metal hits a snag

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Gold’s one-day dollar surge is one for the record books. But as bullion deliveries hit a snag and mining operations slow, the precious metal may soon see prices rally to new heights.

On Monday, the most-active April gold futures contract GCJ20, +5.11%  rallied by $83, or 5.6%, to settle at $1,567.60 an ounce. The one-day dollar gain for the metal was the largest ever, based on data going back to November 1984, according to Dow Jones Market Data.

The move for the metal followed the Federal Reserve’s decision Monday to unleash its balance sheet and purchase an unlimited amount of Treasurys and securities tied to residential and commercial mortgages to ward off a credit crunch, a process known as “quantitative easing” that aims to pump liquidity into frozen financial markets.

Unlimited quantitative easing is a “huge signal, another part of upcoming trillions of new debt monetization,” said Peter Spina, president and chief executive officer at GoldSeek.com. “Many on Wall Street are waking up after the shock” of declines in recent weeks.

“The endless QE to trillions in global liquidity programs are all in gold’s favor among the general turmoil,” he told MarketWatch. “Gold is returning back to its function as a global currency.”

‘I will not be shocked if we see gold at $1,700 an ounce by Friday of this week or next.’

Peter Spina, GoldSeek.com

Spina said he would not be shocked if gold moves up $1,700 an ounce by “Friday of this week or next,” and a gold price of $2,000 and higher is possible in the second quarter.

Futures prices haven’t traded at $1,700 since late 2012 and prices at $2,000 would mark record highs, according to FactSet data.

“We are near the days where we see gold go up $100 or $200 a day and not see a pullback,” Spina said.

The market may also see a “perfect storm for a super price spike” in the coming months as the supply chain for physical gold bullion breaks down,” he said. There are “going to be difficulties sourcing new supplies in a hot market.”

Demand for bullion has been surging for “many weeks” but refiners are closing down, and miners are shutting production, due to COVID-19 lockdowns, he said. “So with a true gold rush underway, there is a perfect storm brewing for the gold and gold miners.”

Three of the world’s largest gold refineries—Valcambi, Argor-Heraeus and PAMP—said Monday that they have suspended production in Switzerland for at least a week on the back of mandatory closure of non-essential industry in the country to prevent the spread of coronavirus, according to a report from Reuters Monday. The report said the three refineries process around 1,500 metric tons of gold a year, or about a third of total global annual supply.

Bullion services provider GoldCore, based in Dublin, said Monday that it has “experienced record demand in recent days and the global supply of gold and silver bullion coins and gold bars has quickly evaporated.”

Read: Physical demand for silver spikes as price drops to an 11-year low

“Most of the largest gold refineries and mints in the world have closed their refining and minting operations for the next two weeks, and this suspension in production may become longer which …will badly impact supply,” GoldCore said.

Mark O’Byrne, research director at GoldCore, told MarketWatch that the supply issues have to do with gold and silver bullion coins, as well as bars, and it’s a “global phenomenon with dealers in the U.S., U.K., Europe and Asia, selling out.”

A full picture of “demand and supply dynamics” for gold won’t emerge for another month, said Juan Carlos Artigas, director of investment research at the World Gold Council. For now, gold, like most asset classes, is being affected by the “unprecedented economic and financial market condition in play around the globe.”

Recent volatility in the price of gold has been “driven by massive liquidations across all assets, and likely magnified by leveraged positions and rule-based trading,” he said. Still, it remains “one of the best performing asset classes year to date.”

Artigas said gold price volatility may remain “elevated until there’s more clarity of the extent of the impact of the coronavirus pandemic to the global economy and the subsequent measures government will enact to slow down the contagion [and] buffer their economies.”

That said, Artigas expects the “high risk levels in financial markets, combined with the widespread negative real rates and quantitative easing, will be supportive of gold investment demand as a safe haven.”

Meanwhile, O’Byrne referred to the selloff in gold futures as “purely a futures driven phenomenon” and said prices are likely to “bottom soon and then start to rise very sharply as the global precious metals supply chain breaks down.”

Gold futures fell by 2.1% last week, following a hefty loss of more than 9% the week before.

Read: Why gold’s plunge proves it’s a safe haven asset

O’Byrne said investors should keep an eye on premiums for bullion coins and bars, as they are a “better price benchmark than the subject-to-margin-call-selling-and-manipulation futures price.”

Outside the Box: Retirees get religion: Aging happier takes a little faith

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As you count the years and months until you can retire, you fantasize about your new life: More time to enjoy your family and favorite hobbies, freedom to sleep late and a lack of obligatory commitments.

With nowhere to be by a certain time, newly minted retirees can do what they want, when they want. All that glorious choice leaves you dizzy with possibilities of what to do.

There’s one option that can unexpectedly rise to the top—an activity that barely registered during your working career but now holds allure.

Here’s a hint: It involves praying.

“As people age, they become more religious,” said Mark Kunik, professor of psychiatry at Baylor College of Medicine in Houston, Texas. “There’s no doubt about that.”

What leads to this intensified practice of faith? It’s all part of the changing landscape of a retiree’s new reality.

“People are looking for meaning for their life,” Kunik said. “When people work, they feel that meaning in their work. There’s a vacuum when they stop working,” so they look elsewhere.

Two other factors can drive retirees to their local church, synagogue or mosque. First, seniors who experience a series of losses (from physical decline to the death of loved ones) may seek solace in religion. Second, they may crave companionship and welcome an opportunity to get out of the house and interact with others who share a common bond.

“Religion can provide social support, especially when you retire,” Kunik said.

He adds that seniors gain health benefits from deriving meaning and purpose from life. Such fulfillment can come from religion, of course, but also from other sources such as volunteering for a nonprofit organization or learning a new skill.

A local place of worship can thus serve double duty: Aside from attending religious services—what Kunik calls “praying and leaving”—you can attend social events such as concerts, movie screenings and discussion groups at that venue.

“It’s those learning and social activities that are good for cognitive and psychological health,” he said. “Even having meals together is a healthy practice.”

While religion is certainly not required to enjoy a happy retirement, it doesn’t hurt. Weekly attendance at a place of worship makes you significantly more likely to be happy in retirement when compared with non-attendees, according to a 2018 survey by Wes Moss, author of “You Can Retire Sooner Than You Think.”

“People who said they attended church once a week were one and a half times more likely to be happy,” said Moss, chief investment strategist at Atlanta-based Capital Investment Advisors. “People who only attended church one to three times a year were 50% more likely to be unhappy.”

But don’t get carried away. Once church attendance increased to more than once a week, happiness levels receded.

Moss can’t explain that. But he does emphasize that religion can serve as a “core pursuit”—a central activity that shapes a retiree’s life.

“Whether it’s attending weekly religious services or engaging in other core pursuits like volunteering, retirees need to avoid idleness,” Moss said. “Social connectedness becomes more challenging when you no longer work and you’re not around people as much. So you have to make extra effort” to participate in your community in order to get more satisfaction from your golden years.

Zillow and Redfin are pausing home-buying — could the coronavirus pandemic make the iBuyer model more popular?

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As state and local governments across the country put restrictions on business activity to stop the spread of the coronavirus, so-called “iBuyer” companies have stopped purchasing homes.

Whether the iBuying business model — in which companies use technology to make instant offers on homes and then sell those properties for a profit — will survive any recession that results from the COVID-19 outbreak remains an open question.

Zillow ZG, +13.48%  announced Monday that it had paused all home-buying activity through its iBuying service, Zillow Offers. “Given the concerns for public safety and rapid developments by governments that restrict local real estate activities, we determined it was prudent to pause our home buying to preserve our capital,” said Zillow Chief Executive Rich Barton said.

The news sent Zillow Z, +14.82%  shares up in trading Monday, even as the Dow Jones Industrial Average DJIA, -3.04%  and S&P 500 SPX, -2.93%  fell in value as the coronavirus outbreak continued to create market turmoil.

Offerpad also confirmed to Marketwatch that it will not be purchasing homes at this time. “Due to health concerns for customers and employees, the uncertainty of the economic impact, and to ensure we are complying with proper local municipalities, protocols and CDC requirements related to COVID-19, we are not currently providing offers to new sellers,” said Cortney Read, Offerpad’s senior director of communications.

Read more: This new trend in house selling could cast a cloud over America’s property market

Before Zillow, Redfin RDFN, +3.10%  and Opendoor had paused their home-buying operations because of similar concerns. That iBuyers chose to stop purchasing homes at this time is not a major surprise, analysts said, because purchasing homes requires a significant amount of capital. “iBuying is capital intensive which is not ideal in a time when everyone is looking for liquidity (or cash),” Danielle Hale, chief economist at Realtor.com, told MarketWatch.

Companies also pointed to the difficulty they now face in off-loading homes from their balance sheets. “We remain as committed as ever to giving homeowners the option of an instant offer, but only when we can know what a fair price for an offer would be,” Redfin CEO Glenn Kelman said. “With whole cities shutting down nearly all commerce, no one can say what a fair price is right now, so we’re not making any instant offers.”

Even as these companies stop purchasing homes, they still face significant hurdles to remain viable as the coronavirus outbreak wreaks havoc on the economy. All of the iBuying companies already have thousands of homes in their inventory — homes that are now much harder to sell as millions of Americans face the prospect of being laid off.

‘If you own one house in Phoenix and the market goes down, 5%, you’re out a couple thousand dollars. The problem is, if you own 3,000 houses and the markets seize up everywhere at once you’re potentially in a lot of pain.’

Mike DelPrete, an independent analyst who tracks the iBuying industry

Zillow confirmed its home inventory balance was 1,860 homes as of March 19, down from 2,707 home at the end of 2019. Other companies, such as Opendoor, were likely buying significantly more homes recently, Mike DelPrete, an independent analyst who tracks the iBuying industry, estimated.

Beyond the costs of keeping those homes on these companies’ balance sheets, which could produce significant losses, there’s also the risk that they will see smaller returns when they go to sell those properties in the future if home prices drop.

“It’s a math problem,” DelPrete said. “If you own one house in Phoenix and the market goes down, 5%, you’re out a couple thousand dollars. The problem is, if you own 3,000 houses and the markets seize up everywhere at once you’re potentially in a lot of pain.”

Also see: Mortgage rates surge to highest level since January even though the Fed just brought interest rates to 0% — here’s why

Because the coronavirus and the resulting economic turmoil have affected all parts of country at once — unlike a more typical recession where only certain markets might be affected — the hedge iBuyers had taken by diversifying their portfolio geographically has not paid off.

And with the unique situation the coronavirus outbreak has caused, these companies are faced with few options of what to do with these properties, such as pivoting toward renting, except sitting on them and waiting for the market to recover, DelPrete said.

Therefore, survival could come down to which companies do more than iBuying, with Zillow and Redfin in a potentially better position than Opendoor and Offerpad.

Those iBuyers that do come through, though, could face a more receptive audience for their business. For home sellers who need to offload their properties as quickly as possible in a recession environment, the speedy process iBuyers offer could be quite appealing.

“From the seller’s perspective, it’s probably a great time to have an iBuyer since you can sell without opening your home up for any open houses,” Hale said.

Dispatches from a Pandemic: In Paris, the French scramble to make sense of a chaotic situation — with paperwork

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PARIS, France — On Tuesday morning, shortly before France went into official lockdown, I stopped to take a photo of the iconic Parisian brasserie Les Deux Magots. The normally-bustling cafe was shuttered, and Saint-Germain-des-Prés, the historic neighborhood where it is located, was the quietest I’ve ever seen it.

As I reached for my phone, a Frenchman came over to me and started grumbling. His parents had lived through the war, he said, and even then, they never closed Les Deux Magots. He was less than receptive when I tried to reason that this was a different kind of threat than the war, and warranted a different response.

You can’t blame him for not fully understanding. President Emmanuel Macron did say six times in a live address last Monday that we were “at war.” That refrain was clear, though other government messaging — including around the actual rules of the lockdown — has been notably more opaque. Despite asking bars, restaurants and non-essential shops to close at midnight last Saturday, March 14, the state went ahead with nationwide municipal elections the following day. (Perhaps no surprise that Paris’ parks soon filled with flâneurs enjoying what felt like the first real day of spring.)

The next evening we learned we’d be starting 15 days of formal confinement (a period everyone expects to be extended). In a decree released after the president’s press conference, we were told we could only leave the house for five reasons, such as going to a doctor’s appointment or buying essential items (in addition to regular groceries, pastries and wine made the cut). We also learned we’d need to carry a certificate, or attestation — essentially a handwritten hall pass excusing ourselves for being outdoors. The memes proliferated.

Macron had specifically said we could go for runs. So Parisians, normally loathe to don active wear in public, flooded the streets in their sneakers and leggings.

Taking brief, solo exercise is also among the five valid reasons for going out, and on Wednesday, you would have been forgiven for thinking a marathon was underway. There was some confusion around whether a simple stroll would be permitted, but Macron had specifically said we could go for runs. So Parisians, normally loathe to don active wear in public, flooded the streets in their sneakers and leggings — though many appeared to be taking suspiciously long walking breaks.

Before long, rumors began to swirl that we would be limited in how far we could jog. On Twitter TWTR, +2.61%, the sports ministry told one curious runner he could only go 1-2 kilometers (0.6-1.2 miles) from home. Out in the street, a police officer told me there was no official limit but rather it was up to their discretion; in her opinion, three or four city blocks seemed fair. By Friday, a friend in the 7th arrondissement heard gendarmes out her window restricting joggers to only 500 meters (0.3 miles). Each new development sent Twitter, and my WhatsApp conversations, into a frenzy.

One triathlete I know, who is currently training for an Iron Man, found a 5-kilometer loop around his Paris home that he can make four or five times per run. But when it comes to cycling, the guidelines are even hazier. The French cycling federation said the sport did not meet the necessary criteria, while the ministry of interior told Liberation newspaper it was permitted if necessary for “personal balance.”

Amidst the confusion, there is space for humor. Another whisper — that soon we would only be allowed to leave the house once a day, and would have to choose just one of the five acceptable reasons — prompted a wry response in my family group chat. “Sounds complicated,” my cousin said, “if you go to work every day, for instance, and need food.”

Authorities are pleading with citizens to use common sense and courtesy, and to take the dangers seriously. France has the seventh highest number of infections of COVID-19, the disease caused by the virus SARS-CoV-2. As of Monday afternoon, there were 20,104 confirmed cases of coronavirus in France, and the number of fatalities hit 862. Worldwide, there were 372,563 confirmed cases as of Monday and 16,381 deaths; 100,885 people have recovered.

But the lockdown also reflects not only France’s unique relationship with bureaucracy, but also its disdain for overreaching authority.

Though they may smirk at the required certificates to leave the house, the French are more than familiar with paperwork. Anyone who’s had to renew a driver’s license or update a national-identity card knows that. They are less welcoming, however, of checks on their personal freedoms. The French national motto, after all, begins with “Liberté” and I’d argue they are second only to Americans in their love of freedom.

Nowhere does that manifest itself more obviously than in their frequently-exercised right to protest. Take, for example, the recent months of general strikes (sparked by a government plan to reform pension schemes, which Macron has now postponed), and the Gilets Jaunes (“Yellow Vest”) protesters, who took to the streets as usual last Saturday despite a global pandemic having been declared.

Still, we are finding silver linings. Every evening at 7 p.m., the residents of the building where I’m staying open their windows to the courtyard and greet each other, often with a glass of wine in hand.

The French have long had a fraught relationship with authority. Some took issue with the state of emergency declared in 2015 after a series of terrorist attacks. That was extended five times over the course of two years, and activists argued the exceptional powers given to security services were eroding human rights. Even I found it unsettling, during that time, how gendarmes could materialize out of nowhere one moment and disappear the next.

Now, again, there is a heightened police presence. Though they are tasked with fining people for breaking the lockdown rules, their presence could also ease concerns about street crime given the emptier neighborhoods and talk of an impending nationwide curfew (the city of Nice already imposed one last week). The question of crime admittedly crossed my mind when, during the only metro ride I’ve taken since the lockdown, I witnessed an attempted cell-phone robbery on a nearly-empty train.

Just like in the U.S., there is a shortage of N95 masks in some hospitals, while police still appear to have them, and many civilians, too. One of my cousins, a medical resident who works in an emergency department treating non-coronavirus patients, is being rationed three surgical masks a day. Those might protect his patients from him, but won’t protect him from the patients, or anyone else. Meanwhile, Parisians, like the Spanish, are taking to their balconies every evening to cheer for medical workers — a heartwarming gesture, if not as useful as PPE.

As the first week of lockdown rolled into the weekend, Paris became noticeably quieter. Whether it was the colder weather or people starting to feel the sting of police fines (€135, or $145) if you break the rules), the streets emptied. No amateur athletes along the Seine; the quays were closed to foot traffic on Saturday. On Sunday, the day my family usually gets together for lunch, we instead took to our computers — and celebrated my nephew’s third birthday over video call.

Still, we are finding silver linings. Every evening at 7 p.m., the residents of the building where I’m staying open their windows to the courtyard and greet each other, often with a glass of wine in hand. We’re not Italian — we don’t sing songs — but even this gesture is more than you might expect from Parisians. My French aunt, with whom I’m locked down, liked the idea but worried we’d have little to say. We’ve lived in the same building for years but barely know each other, she admitted.

In the end, we’ve been pleasantly surprised by the friendly conversation. Amidst all the uncertainty, it is one regular activity we never miss.

TaxWatch: IRS removes cap on the amount of taxes that can be deferred until July 15

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Individuals and businesses can now defer any amount of owed taxes until July 15, the Internal Revenue Service announced.

The Treasury Department is contributing to the government’s efforts to ensure people and businesses have quick access to cash as the coronavirus outbreak grinds into the economy, keeping consumers at home and putting millions of jobs at risk.

Previously, individuals, married couples and small business owners could defer payment on up to $1 million while corporations had a $10 million limit, according to initial made earlier this month.

But the IRS took away those caps in a notice issued Friday night. Interest and non-payment penalties will only begin to accrue on July 16.

The same notice clarifies that the rules extending filing and payment dates for people and businesses also apply to estates.

Last week, the IRS pushed back the deadline to file and pay income taxes from April 15 to July 15.

Don’t miss: IRS will allow high-deductible health plans to cover the cost of coronavirus testing

Treasury Secretary Steve Mnuchin is urging taxpayers to keep filing their taxes as soon as they can, regardless of the extended dates. That way, anyone who is due a tax refund can get it as soon as possible, he’s said.

The IRS received 76.1 million individual returns as of March 13, according to the agency’s statistics. The average refund was $2,973.

Outside the Box: How to plan for the unique financial challenges women face

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As we celebrate another Women’s History Month, I’ve been reflecting on the role of women in the financial ecosystem.

Women make up half the population but for so long have been treated like a niche demographic in financial services. Today, women are largely responsible for their families’ financial decision-making, and we hold the majority of consumer spending power. Certainly, we are anything but a niche.

Let’s take a look at the numbers. Women are a true financial force, controlling over half of personal wealth in the United States, to the tune of $14 trillion. By 2030, we’re estimated to control two-thirds of it, thanks in large part to the coming wave of intergenerational wealth transfer from Baby Boomers to succeeding generations. That’s a lot of assets in female hands.

I’ve heard many times that investing in women is a great way to invest in whole communities. Globally, working women put significantly more of their earnings into their families than men do,3 and women are responsible for 70%-80% of all consumer spending, which means we’re putting a lot of money back into the economy.

With all of this economic power, you might expect women to feel they are on top of their financial lives. Unfortunately, that’s not the current case.

Research shows that women are much more likely than men to experience financial anxiety (57% vs. 47%) and to feel stressed when discussing their finances (49% vs. 38%). Moreover, just 12% of women are “very confident” they’ll be able to retire comfortably.

These numbers might seem disheartening, but we can turn the tide through education, goal-setting and planning.

Planning for the challenges women face

It is true that women’s needs and obligations often differ from those of men, so we should be having candid conversations about money acknowledging that fact.

For one, women provide a disproportionate amount of caregiving in the U.S., and much of this labor is not only unpaid but may also lead to a reduction in income. For instance, we may put our careers on hold or reduce our working hours to care for children and/or aging parents.

Spending less time in the workforce can have far-reaching financial effects, in some cases preventing participation in company-sponsored retirement plans, or preventing a smooth career trajectory and the pay increases that come with it.

On average, women live about five years longer than men, meaning many of us outlive our male partners. Because of the career interruptions I just mentioned, that means many women are living longer on less income.

Finally, women may not be taking full advantage of the investment opportunities at their disposal, or the potential for their assets to grow, as they are more likely to take a conservative approach to money.

Setting and meeting goals

When I talk to women about their money, I encourage them to think of it as a vehicle for realizing their personal vision of success. Through thoughtful planning, you can garner the financial freedom to pursue your dreams, bring stability to your life and the lives of your loved ones, handle the inevitable obstacles life throws in your path, and contribute to the causes close to your heart.

That all sounds great, but how do you get started? There are a few basic steps for developing a money management strategy.

First, define your goals. Some of the things you’ll want to consider are the personal and professional milestones you hope to achieve in the short- and long-term. You might ask yourself what being financially comfortable means to you. Even if it seems far away, you should begin to think about what an ideal retirement will look like, whether it’s traveling the world or moving close to your grandchildren.

With your goals articulated, a sound next step is to come up with a saving and investment strategy, keeping in mind that it may very well change over time. A great place to start is with your workplace retirement plan, which may offer access to professional advice. If you have other financial wellness resources available to you at work — such as financial planning or coaching, or educational programming — enthusiastically take advantage of them.

Get your family involved in this planning as well. With your partner, be honest about financial values and fears. Level-set on goals and expectations for retirement. And be sure you have information about and access to one another’s financial documents and accounts so you’re prepared if something should happen to one of you.

If you have kids, talk to them about money too. You might discuss values around money, what their definition of success looks like – understanding it may differ from yours – and how they may be able to use their resources to affect positive change. Also get them thinking about important concepts like credit, budgeting and starting to save and invest early.

Preparing for the expected and the unexpected

For all of our careful planning, life is bound to throw us curveballs. A change in employment, an accident or illness, or the loss of a loved one can take a major financial toll on top of the physical and emotional trauma. In the short term, work towards building an emergency fund in a liquid account, which could cover three to six months of essential living expenses if you find yourself short on income.

Depending on your age, estate planning may or may not be top-of-mind, but one of the best ways you can care for your family is to get your financial affairs in order. Proper estate planning can help you manage estate taxation, ensure your assets will go to the intended beneficiaries and minimize family turmoil.

When it comes to healthcare, plan for the best but prepare for the worst-case scenario. You can do this by making sure your health insurance plan covers the essentials, considering life and disability insurance policies, getting important legal documents in place (including a healthcare proxy and medical directives), and factoring the long-term cost of healthcare into your overall wealth management strategy.

The bottom line

It’s natural to feel overwhelmed by all the life events we need to prepare for. But women are tough, and we’re smart, and we’re planners.

Feeling in control of your finances can propel you in so many other areas of your life, so you owe it to yourself to define your goals, start a dialogue with your loved ones and create a game plan. The modern face of wealth is female, so walk confidently into your financial future.

Krystal Barker Buissereth, CFA, is executive director and head of financial wellness, Morgan Stanley at Work.

This article has been prepared for informational purposes only. The information and data in the article has been obtained from sources outside of Morgan Stanley. Morgan Stanley makes no representations or guarantees as to the accuracy or completeness of the information or data from sources outside of Morgan Stanley. It does not provide individually tailored investment advice and has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. The strategies and/or investments discussed in this article may not be suitable for all investors. Morgan Stanley recommends that investors independently evaluate particular investments and strategies, and encourages investors to seek the advice of a Financial Advisor. The appropriateness of a particular investment or strategy will depend on an investor’s individual circumstances and objectives.

Morgan Stanley Smith Barney LLC (“Morgan Stanley”), its affiliates and Morgan Stanley Financial Advisors and Private Wealth Advisors do not provide tax or legal advice. Clients should consult their tax advisor for matters involving taxation and tax planning and their attorney for matters involving trust and estate planning and other legal matters.

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FA Center: This is a sure way to make costly investing mistakes in the coronavirus crash

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All of the Dow Jones Industrial Average’s gains since 2017 have been erased, and the U.S. market benchmark is verging on its worst month since the Great Depression. Who wouldn’t be checking their investment portfolio all of the time?

Yet the frequent checking not only raises your anxiety level, but also makes you a worse investor. Behavioral finance studies into investor behavior confirm this. Their consistent finding is that we tend to be more cautious when we check our portfolios constantly, with adverse long-term consequences for our investing goals.

I was prompted to write this column after seeing a full-page magazine advertisement from a major financial services company extolling the virtues of its smartphone app that allows you at any time — in this ad it’s a nature walk — to check on and update your long-term financial plan.

Really? The mark of a good financial plan is that it frees you from having to check and re-check your portfolio every day, week, month or even quarter — much less while walking your dogs. The ability to make changes while strolling through the forest is a recipe for self-destructive behavior.

The groundbreaking study proving this was published in the Quarterly Journal of Economics in 1995 by Shlomo Benartzi, a professor and chair of the Behavioral Decision-Making Group at the UCLA Anderson School of Management, and Richard Thaler, Professor of Behavioral Science and Economics at the University of Chicago Booth School of Business (and 2015 Nobel laureate in economics). The professors reached their conclusion after conducting simulations comparing the behavior of investors who frequently checked their portfolios versus those who did so infrequently.

The researchers found that the former group constructed much more conservative portfolios, with far lower equity exposures, than the latter group. The professors called this phenomenon “myopic loss aversion.” Not surprisingly, it led the more frequent checkers to have significantly poorer performance over time.

To be sure, this research was published before the internet had come to completely dominate our lives. In the 1980s and 1990s, many investors relied on monthly or quarterly statements to determine their net worth. So the professors assumed that the frequent checkers were those who looked at their portfolio values every few months.

Calling those people “frequent checkers” seems quaint, since they now would be considered almost long-term investors. But the same pattern that Benartzi and Thaler discovered three decades ago applies in today’s 24/7 world.

Consider a 2016 study from the National Bureau of Economic Research that compared the performance of stock traders in two different groups: Those who focused on their portfolio’s performance on a second-by-second basis with those who checked every four hours. Those in the four-hour group “invest 33% more in risky assets, yielding profits that are 53% higher, compared to traders who receive frequent price information,” the study found.

Recent volatility provides a good illustration of the general phenomenon. On March 16, the Dow DJIA, -4.55%  dropped 3,000 points, or 12.9% — the worst one-day percentage plunge for the Dow since 1896, with the sole exception of the 1987 Crash. That was enough to send anyone into a panic — if they were watching the market that day. In fact, however, the broad market at the March 16 close was just 3.8% lower than where it had closed two trading sessions previously. Those who focused on the Dow’s three-day rate of change were a lot less anxious than those who focused on shorter horizons.

Human nature

By the way, this pattern that the researchers have documented appears to be fairly universal, and not confined to the stock market.

Consider a study conducted by Ellen Peters, director of the Center for Science Communication Research at the University of Oregon, and Par Bjalkebring, a researcher in the Department of Psychology at the University of Gothenburg in Sweden. As Peters described in a recent New York Times article, they compared the anxiety levels of two groups of Americans: The first contained those who at least once a day had checked the latest coronavirus statistics, and the second contained those who were less-frequent checkers. They found that the frequent checkers were more anxious, with 38% of them self-reporting that they worried about the virus, in contrast to just 18% of those who checked less frequently.

“Our findings suggest that people who look frequently at coronavirus statistics may focus too much on the scary stuff — the numbers of infected people and deaths — and not enough on the numbers of people not infected and of those infected who survived,” Peters wrote.

Antidote to myopic loss aversion

Is there an antidote to myopic loss aversion? To find out, we need first to understand what causes it. Benartzi and Thaler argued that it is the result of two factors: people are more sensitive to losses than to gains, and the shorter-term our focus, the more we experience losses.

Since our sensitivity to losses is hard-wired into our psyches, we’re unlikely to change it anytime soon. So the key is to check our portfolios less frequently.

Is that realistic? The only way to find out is to try. Carve out significant periods where you don’t check the markets. Make these periods long enough, and do this experiment enough times, to get a good idea of how it may affect your mood.

Not only might you find yourself less stressed, your portfolio over time may actually perform better. That would reduce your anxiety level even more, creating a virtuous cycle in which you eventually find yourself leaving your smartphone at home when you take the dogs for a walk.

Mark Hulbert is a regular contributor to MarketWatch. His Hulbert Ratings tracks investment newsletters that pay a flat fee to be audited. He can be reached at mark@hulbertratings.com

More: Wall Street money manager says the stock market won’t hit bottom until investors throw in the towel — and we’re not there yet

Also read: The Dow is on pace for its worst month since the Great Depression, but here’s why all hope isn’t lost amid the coronavirus crisis

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Next Avenue: How to get Social Security help while the agency’s offices are closed

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This article is reprinted by permission from NextAvenue.org.

The Social Security Administration has closed all its 1,200 field offices around the country until further notice due to the coronavirus pandemic. So, what will it mean for you if you’ll need help with benefits, a replacement Social Security card or have questions about Social Security or Medicare?

The answer depends on how you’ll turn to the Social Security Administration for help as a result. You may be able to get what you need online — though that could depend on which state you live in. But if you’ll want to speak to a Social Security phone rep, prepare for a long (possibly very long) hold.

For questions or concerns that require speaking to a human, you’ll need to try calling the Social Security toll-free number and be prepared to wait.

The decision to close the offices, Social Security Administrator Andrew Saul said, “protects the population we serve — older Americans and people with underlying medical conditions — and our employees during the Coronavirus (COVID-19) pandemic.”

That it does. And it’s especially wise considering that many of the 43 million annual visitors to Social Security offices are older Americans, who are the most susceptible to the coronavirus.

Social Security benefits during the pandemic

Payments to the 69 million-plus Social Security beneficiaries won’t be affected by the field-office shutdown. And field offices will continue offering in-person assistance in what the agency calls “dire circumstances” — such as helping people with severe disabilities, blindness or terminal illnesses.” You’ll need to call the local office in advance to arrange for these meetings.

Also read: I tested 2 free Social Security retirement calculators, and here’s what I found

If you had an office appointment scheduled, expect to get a call from a Social Security staffer. That person will either try to help you by phone or reschedule, according to Mark Miller in the New York Times.

One impending Social Security customer service problem: the agency’s toll-free number (800-772-1213) has been understaffed for years due to severe agency budget cuts.

Social Security’s customer service challenges

“We have some challenges, as everybody knows, in delivering the proper service to our customers,” Saul told AARP in February 2020. “The 800 number, that has been a major problem, major concern for all our customers. If you called in, you would find you had an unacceptable waiting time — sometimes 30 minutes, sometimes 40 minutes.”

To his credit, Saul announced plans to attack the problem when he took the job last year, calling improved customer service his priority. Since then, he brought on 500 teleservice reps, which he told AARP cut down call time by about 50%.

Also on MarketWatch: How can we fix Social Security’s coming cash shortfall?

He said another 500 phone reps would be hired later this year, though that was before the pandemic. In February, he told AARP: “I think if you watch over the next six months, we will get the call centers down to the proper waiting time, which will be close to zero. That’s a prediction that I’m willing to make here, and I believe we will succeed in doing this”

Whether that prediction will come true given how the world of work has changed due to the coronavirus is anyone’s guess.

In January, Saul also reversed a 2012 decision to close Social Security offices at noon on Wednesdays. From then until the coronavirus shutdown, all its offices were open 9 a.m. to 4 p.m. weekdays.

Getting a replacement Social Security card now

About a third of people coming to Social Security offices do so to get replacement Social Security cards. And roughly 20% come for their Social Security benefit statements.

You can also get your Social Security benefit statement on the Social Security website or apply for benefits there, as long as you have a “mySocial Security” account.

Read next: The IRS is postponing tax payment deadlines during the coronavirus outbreak — what that means for your taxes

If you need a replacement Social Security card, you can apply for one free online at the Social Security website — but only if you live in one of the 40 states that permit this for all citizens age 18 or older. The ones that don’t: Alabama, Minnesota, Nevada, New Hampshire, Ohio, Oklahoma, Oregon and West Virginia. In Delaware and Wisconsin, you can only apply online if you have a driver’s license. So, if you can’t apply online, you’ll need to call Social Security for help getting a new card.

To apply for a card online if you live elsewhere, you’ll need to have or set up a “mySocial Security” account. Before the pandemic, it generally took 10 to 14 business days from the time your application was processed to get the new card in the mail.

There’s no need to pay a fee to a private service to do this for you.

What the Social Security site can do for you

You can also get your Social Security benefit statement on the Social Security website or apply for benefits there, as long as you have a my Social Security account.

Check the Social Security site periodically for updates on its procedures during these turbulent times or sign up there for alerts about the updates.

When you have to speak to someone at Social Security

For questions or concerns that require speaking to a human, you’ll need to try calling the Social Security toll-free number and be prepared to wait. Social Security’s advice to callers: “Please be patient.” The phone reps will prioritize urgent issues.

Back in December 2019, Kathleen Romig, senior policy analyst at the Center on Budget and Policy Priorities, told Next Avenue: “If you are going to call the 800 number, you should block out an hour of time so that you can wait on hold.” And that was before the you-know-what.

Richard Eisenberg is the Senior Web Editor of the Money & Security and Work & Purpose channels of Next Avenue and Managing Editor for the site. He is the author of “How to Avoid a Mid-Life Financial Crisis” and has been a personal finance editor at Money, Yahoo, Good Housekeeping, and CBS MoneyWatch. Follow him on Twitter.

This article is reprinted by permission from NextAvenue.org, © 2020 Twin Cities Public Television, Inc. All rights reserved.

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