Friday Financial Five – January 31st, 2014
Friday, January 31, 2014
The new government retirement plan
The big financial news coming from the State of the Union address is the White House’s push to implement a government-sponsored savings account called “MyRA”. The account would be treated similar to a Roth IRA in that it would be an after tax contribution and would grow tax deferred. The funds would be invested in government bonds, which seems like a good way to make sure there’s always a market for the government’s debt. For employers that participate, the proposed threshold would allow contributions for households that make below $191,000. There would also be a maximum balance of $15,000, at which point the worker would be forced to roll the funds over to privately held Roth IRA. This isn’t a cure, but it brings renewed focus to workers’ lack of retirement savings.
Taper, taper, taper
In the lexicon of finance, “taper” has seen a compounded level of importance to the point that it may be the most important word for markets globally. The market’s abysmal week may have been a direct result of the anticipation of Wednesday’s Fed meeting. To their credit, the FOMC stayed the course and reduced bond purchases by another $10 billion, without any dissenting votes. This should continue throughout the year, while keeping the target interest rate near zero and reducing the market’s reliance. And at some point, the public will be able to hear “taper” and simply go about their day.
The intricacies of Roth conversion
All people with a traditional IRA can convert to a Roth, but some may shy away from doing it because of the steps or analysis involved. The primary concern is that converting will cause a taxable event. Any amount that is moved from traditional IRA to Roth will be included as income in the year of conversion, and it’s best that funds to pay that additional tax come from outside of retirement accounts. Converting is also not necessarily the end of the story. If an individual’s situation changes or the account value drops dramatically, the IRS allows a recharacterization of the IRA, reversing the process. Traditional IRA holders should review income, tax brackets, and financial goals to see if a Roth conversion makes sense.
Penalties for not having health insurance
With the Affordable Care Act dependent on young people enrolling, the IRS recently detailed possible penalties for non-compliance. The fine line here is making it painful enough that people will be inclined to join but not so burdensome that people go broke just trying to pay for insurance coverage. The penalty for lack of coverage starts out relatively affordable this year at $95 per month. It then jumps to $325 monthly in 2015 and $696 monthly in 2016. After that, the penalty will adjust according to inflation. The government will accept “minimum essential coverage” as proof of insurance, and the cost of this coverage can’t exceed 8 percent of an individual’s household income or the person is exempt.
Save the yacht owners!
Yacht owners and boat builders are uniting to save a tax deduction that currently allows the classification of yachts as second homes, which allows some owners to deduct financing interest. Democrats in congress are targeting this deduction as an unnecessary loophole, pushing the “Ending Subsidies for Yachts Act”. Currently, the IRS requires a camp stove, temporary toilet, and occupancy for 14 nights a year for yachts to qualify as a “second home”. This is a small portion of the overall interest deduction, but it’s expected to be included in a grander revision of the tax code.
Dan Forbes is a regular contributor on financial issues. He is a CFP Board Ambassador. He leads the firm Forbes Financial Planning, Inc in Providence, RI and can be reached at email@example.com .
“I think that being a chef is in my blood; the lineage of chefs in my family runs deep. As a child, I remember most kids mowing lawns to buy candy and things like that. I was kind of strange; I was using that money for fresh oysters.”“I have entered every competition since the first. It really is a blast. It’s one of the few times that all of us chefs from the Worcester area can get together and have a good time.”“I don’t really get the chance to dine out that much; most of my food is eaten at the restaurant. It’s probably for the best because I am one of the biggest food critics out there.”
Bushel N’ Peck
Grafton“I try to use as many local ingredients as possible in my cooking. We have a good relationship with Potter Hill Farm so we try to use whatever fresh ingredients as possible.”“My wife and I try to eat at home as much as possible and we try to eat as healthy as possible. When we do dine out some of our favorite restaurants include Prezo in Milford and Bocado in Worcester.”“I would describe my style of cooking as taking classic dishes and twisting them in a healthy-creative way.”
Sturbridge“My favorite foods to make are comfort foods. Comfort foods make people happy and that’s why I’m in this business.”“My dad was out of work in the 80s and used to rent Julia Child videos. When I came home from school we would watch them and then cook dinner for my mom.”“There are a handful of places in Worcester as well as Boston that I really enjoy eating at. I went to New York recently just to eat.”
Marlboro“My favorite season for food would have to be fall. I like how the cold weather allows for these slow-cooked and comfort meals.”“I’ve loved food since I was a child. We didn’t have a lot of food around the house so we cherished every meal.”“I prefer to cook at home around people, usually with a nice bottle of wine or a few brews. But when I dine out, I prefer the small ethnic mom and pop places.”
Worcester-comments from chef/co-owner Albert Maykel”I have been working with her for about six years now. [Her cooking style] is very comfort-oriented. She is a quick learner and very intelligent in the kitchen. She is a very hard working person and cares about the food that she makes. If she says true to her skills then I think she has a great shot [at the competition].”
Sturbridge“I went to automotive school; it made me realize how much I liked cooking. It also made me realize what I was good at. From then on, I was able to be a chef with a clear head.”“I grew up with my father being a chef. I kind up grew up in the industry. I remember peeling 400 potatoes as a kid and as I got older I had different jobs throughout the industry. Cooking was all I knew so it was all I did.”“Who doesn’t like pork? I also enjoy the process of letting something sit in the fridge for 30 days; it’s a lot of fun. Making your own pasta can be a lot of fun as well.”
Flying Water Cafe & Watering Hole
Worcester“I love making soups. It’s a great combination of different flavors. Also, you can turn almost anything into a soup. I remember the first time a customer tried one of my soups and they said that it was great and they would come back for more; from that point on, I was hooked.”“I absolutely love fresh herbs. You can gear them toward any season. They are a great multipurpose ingredient.”“I love a good homemade brick-oven pizza, but due to my hours I don’t get to cook at home as much as I would like. My wife is a great cook though; she usually has something good waiting for me when I get home.”
Worcester“Being a chef, you have to like and be willing to cook anything. Everyone may have a favorite dish or a specialty, but a great chef can make anything.”“I don’t see it as a competition; I see it as a gathering. We are coming together to try our best and to be here for the customers. I am proud of us making a day to come together and be there for the community.”“The best season has to be September and October. The produce, fruits, and fish are at their freshest; it’s all right there. Autumn is the heaven of the year. It’s better to get fresh local ingredients than to have them shipped to you because they aren’t in season.”
Rafael Guzman Cruz
Two Chefs Restaurant & Pastry Shop
Spencer“I don’t get to make it very often, but I like to make offal and sweet bread. Offal [the internal organs and entrails of an animal] has a more concentrated flavor in the meat than something like steak.”“It was great to learn how to make pizza dough. It is cool to see how a few simple ingredients will transform into a crispy form of bread. It was the first time I thought about the science behind food.”“Cooking was a way for me to express myself; I was introverted as a child. The kitchen was a great place because it became my own little world. I really liked cooking with my grandmother as a child; we did a lot of cooking with root vegetables and chicken.”
Oxford“I remember my first day in the kitchen; I almost chopped my palm of with the mandolin.”“I’m going to show the people what I am made of.”“We pretty much like to cook at home; my girl is also a good cook.”
Worcester“My favorite dish is a big ol’ steak; I’m old fashioned like that: meat and potatoes. I grew up on a farm so we used to eat steaks from our own cows.”“I’m known for my hot sauces; I’m a huge pepper-head. I love using a lot of hot peppers in my cooking.”“My first childhood memory would have to be making meatballs in my dad’s kitchen when I was about eight. I also remember being in my 20s out in Michigan. I remember the chef using a lot of fresh and local ingredients which was really inspiring.”
The Goddard House
Worcester“I love making sautés. I like them because you get to add one ingredient at a time. The process just creates a burst of flavor.”“I’m ridiculous but I like everything when it comes to food, except for other people’s cooking. I also don’t like junk food; I’ll maybe have some popcorn every now and then but that’s about it.”“Butter and salt are the biggest things for me. I also like cooking with garlic and onions. I’m big into sweet and savory dishes and I like to balance out my meals to fit that palate.”
Worcester“I enjoy pretty much everything [when it comes to eating]. That’s why I’m in this business; I enjoy food.”“I like to cook lamb shank. I love the way that it tastes and how it cooks.”“I like cooking with lemon and garlic. You can use them for almost anything.”
Dean Della Ventura
Millbury“I’m kind of an Italian guy when I cook, but I’m a meat and potato guy at heart.”“I’m definitely looking forward to the competition. I think I have a good opportunity to sweep. There are a lot of young bucks in the competition but I’m ready. It should be a fun time.”“I remember being in my grandmother’s kitchen. I remember watching her stir the sauce and making the meatballs and the pasta. Occasionally my brother and I would try to sneak a taste and we would end up getting slapped with a wooden spoon.”
Cherry Valley"If you see me, you will know that I enjoy everything; I'm always willing to try [any food] once. And if I don't like it, I usually try it a second time.""My favorite season, absolutely, is fall. I have my own garden at the restaurant and at my house and fall is the best time for fresh fruits and vegetables. I also like the fall because all of my spring vegetables have been pickled or preserved. I just love fresh and local ingredients; I try not to use anything with GMOs in it.""This competition is a great event for all the local chefs. Something Dom [Dominic Mercurio, founder of the event] does well is he brings in kids from the Worcester Vocational High School to help out. For me, it's all about the kids."
Worcester“I don’t like to do the same thing twice. I think every time I cook is an opportunity to try something new.”“My favorite season would have to be summer because of all the fresh fruits and veggies; that’s my thing. I also like cooking with animal fats because they have a nice, robust flavor that you can’t get with butter or oil.”“I was overweight as a kid and there became a time when I didn’t want to eat my mom’s cooking anymore. She told me that if I didn’t want to eat her food I would have to cook myself.”
Park Grill & Spirits Bar
Worcester”My favorite season, in general, is late summer, specifically late August to early September. Fruits and veggies are readily available and at their best. It really is the best time to be a chef.”“I’m super excited. This is my 4th year in the competition. Normally chefs are locked in the restaurant, so it is a refreshing change to be in a room among peers. I thrive on competition, as I think most chefs do.”“My favorite place to eat is at my own dining room table with my two boys and my wife.”
Worcester“I love this industry. It is very capturing and I love the excitement. There is also a lot of hard work and comradery which I love.”“I remember my grandmother always cooking when I was a child. Every day after school there would always be cookies or brownies or something being cooked.”“I love Vietnamese food. The food is just incredible. I try to eat it at least once a month.”
Northboro“I just want to have fun and have a good time. It is a great place to meet people. My main focus in this competition is not to win, just to have fun. This is my first time in this competition and I’m definitely a little nervous.”“I’m a big seafood guy; anything with seafood is great. The more seafood you can fit on my plate the better.”“I grew up with my grandmother and she cooked every day, twice a day: lunch and dinner. At one point I decided it was something I wanted to do and I got hooked.”
Damian EvangelousArmsby AbbeyWorcester"Whatever season we are in is my favorite season. I think every season has its perks. Every time a new season comes around I get excited to cook.""I was pretty young when I decided that I wanted to cook. It all started with me watching shows like Emeril Lagasse and Mario Batali on the Food Network.""I'm pretty excited for the competition. This will be the first time anyone from Armsby Abbey will be competing; I feel confident."