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10 Consumer Economy Problems That Urgently Need Fixing – Part 2

10 Consumer Economy Problems That Urgently Need Fixing – Part 2

In our last article we took a look at some of the problems that plague our financial market when the time comes for it to connect with the average customer. Most of the first five reasons deal with a severely deficient communication from the financial institutions towards their customers. Now let’s take a look at the next five consumer money problems that need to be fixed.

6. Problems with care insurance for the long-term:

Around 8 percent of elder citizens in the country have acquired long-term care insurance. Its benefits seem obvious of course, since it provides support for those suffering from any physical or mental problems that might not allow them to perform even some basic activities, like feeding, dressing or going to the bathroom for themselves for example. The reality is of course, that at least two-thirds of us will actually need these kind of services at some point in our lives and care insure becomes a must then, since the actual costs of specialized care of this kind can even bring down the finances of even the most wealthiest family, even if they acquire a personal loan to cover these expenses. In fact, health bills the number one reason for personal bankruptcies. Even then however, long-term care still fights to make its way into people’s lives, and is still disregarded by many.

7. Mortgage precautions:

The reason why the mortgage crisis occurred in the first place is that barely anyone paid attention the requested mortgage application, thus causing all of them to be approved, just as personal loans were. In the end, this brought  along the collapse of housing prices and millions of citizens losing their investments in the process. Now, even as the housing industry finally start to recover from the crisis, people who are perfectly capable of acquiring a personal loan or a home loan are being rejected by banks that are reluctant to loan money no matter how solid the borrowers are.

8. The mutual fund fees issue:

After what seemed like years of hearings efforts, the federal reserve finally came up with new disclosure rules pertaining fund fees. Investors of course, have already received their first batch of disclosure forms. However, these documents actually don’t disclose any fees that have to be paid. And even worse, it is not clear in the first place if consumers are actually reading the forms they are given.

9. Social security hardships:

The number of people who get a monthly Social Security or Supplemental Security Income (SSI) payments is now around 62 million. The interesting part here is that our government actually does a pretty good job of getting those payments out and, more importantly, of keeping track of all the earnings of everyone that has any wage income. the problem here though, is that social security has now become the main source of retirement income for the vast majority of Americans without them fully understanding how the system actually works. This in turn doesn’t allow them to claim other benefits that this program could offer them. The situation is already bad, but it gets even worse, since the Social Security Administration has actually stopped paper-based statements that used to explain the program to participants due to budge cuts.

10. Understanding taxes:

You might find it hard to believe, but there is actually a huge amount of financial advice out there all pertaining is about taxes. Here are just a few examples:

– Are the contributions on this account taxable?
– Compare income-taxes against capital-gains taxes.
– If I claim Social Security before my retirement age, how will any additional earnings be taxed?

Taxes are perhaps the most complicated and misunderstood of all our money problems. Surprisingly though, they are also the ones that can provide us with the most benefits if we only learn to handle them properly.

And there you have it. While this list is by no means comprehensive, at least you know that there are some real problems that need to be tackled by our government. But what is even more important is that we can actually go a long way by simply making an effort to understand them.