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Newly minted MDs at Morgan Stanley and Bank of America; unpacking Visa's $5.3 billion Plaid buy

Sat, 01/18/2020 - 7:49am  |  Clusterstock


Only 90-some-odd days until next bank-earnings season!

The trifecta of JPMorgan, Wells Fargo, and Citi in one day, followed by the rest of the Wall Street crowd reporting in the days after, meant a week of early mornings for financial journalists. That's OK, though, since we also get to have some fun parsing testy exchanges on analyst calls — this is, after all, a world where "thanks for that" often means quite the opposite, and "let me try that question again" is basically the webinar version of an all-out brawl. 

All of that verbal wrangling is part of a quest for "color" — in non-earnings-world speak, that's anything to help decipher the rush of numbers and vague explanations banks throw at you. Luckily, our reporters are always talking to insiders to do just that. 

If you aren't yet a subscriber to Wall Street Insider, you can sign up here

Alex Morrell explained what's behind a much-welcomed surge in bond-trading revenue across Wall Street. It sure seems like a great time to be an agency mortgage trader — insiders say JPMorgan led the pack there —  but it may be a short-lived party. 

Morgan Stanley is normally among the last to report when it comes to big-bank earnings, but earlier in the week Alex was quick to nab all the names (here's the list) of its 2020 MD promotes. It's a smaller class than recent years — understandable given the 1,500 layoffs the bank announced in December. Oh, and Alex also got the names of the new crop of Bank of America sales and trading MDs, and broke news on a big FICC overhaul there. 

Dakin Campbell has been covering Goldman Sachs' huge transformation under CEO David Solomon. Goldman execs told analysts to hang on until the bank's first-ever investor day for the real juicy stuff on its five-year plan. But as Dakin noted, Solomon did unveil key details this week about transitioning the bank's private-investing platform to be more reliant on outside money. 

To segue out of publicly-traded firms and into the startup space, Bradley Saacks noted that BlackRock CEO Larry Fink is "proud" that analytics platform Aladdin is close to topping $1 billion in revenue, a threshold he says only 3% of tech startups beat. Turns out, the one big secret to startup success that nobody's telling you is being attached to the world's largest asset manager. (BlackRock also just blew past a mind-boggling $7 trillion in assets.) 

That brings us to a call that caught everyone off-guard — this one was for the card folks after Visa announced it would buy buzzy fintech Plaid for $5.3 billion. And as Dan DeFrancesco pointed out, Visa CEO Al Kelly made what might seem like a passing comment that actually has huge implications for the web of financial players that will interact with a Visa-owned Plaid. 

Not everyone's racing to snap up fintechs, though. As Rebecca Ungarino reported, Merrill Lynch has zero plans to buy a robo-adviser. That thinking highlights how standalone wealth-tech firms may be in a tricky spot as legacy players invest in their own tech. Meanwhile, new startups in the space have ground nearly to a halt. 

Long reads below, including a deep dive on how exactly pricing algorithms for iBuyers like SoftBank-backed Opendoor work; Jamie Dimon's argument for why JPMorgan should really be thought of (and valued like) a subscription service; and why KKR is looking in unlikely places to invest in tech companies.

Have a great weekend, 


Insiders explain how iBuyers like SoftBank-backed Opendoor mix algorithms and human decision-making to flip houses

iBuyers, companies that purchase homes with almost instant all-cash offers, renovate and quickly resell them, were born in 2014 in the heat and sun of Phoenix, Arizona. 

SoftBank-backed Opendoor, now valued at $3.8 billion, first started purchasing homes in Phoenix that December.

By 2015, competitor Offerpad was also buying and flipping homes in Phoenix. The iBuyer model has continued to grow, with established real-estate listing players like Redfin and Zillow entering the fray. There are now active iBuyer markets in almost every region of the US, and even some international regions.

While iBuyers have tested new markets, Phoenix's lack of seasonality, an active local economy and housing market, and largely new housing stock has made it the iBuyer capital. 


WeWork convinced a skeptical SEC to let it use a wonky metric that tested accounting rules. Here are 58 pages of letters showing how the coworking company changed the agency's mind.

Business Insider obtained 58 pages of correspondence between the SEC and WeWork about the coworking company's IPO filing and questions or concerns the agency had about the document.

One crucial piece of the back-and-forth centered on the company's use of a non-GAAP financial metric.

The SEC originally asked WeWork to "remove disclosure of this measure throughout your registration statement."

After pushback from WeWork's lawyers, including a former chief of the same SEC division asking the company to scrap the metric, the agency relented and allowed the company to continue using the metric after it made some changes. 


Jamie Dimon makes renewed pitch for JPMorgan to be valued like a subscription service — and it shows how Wall Street is trying to echo Big Tech

Jamie Dimon may have just a tiny bit of tech envy. 

The JPMorgan Chase CEO sounded a familiar note on Tuesday on a call with journalists when he casually compared his bank to competitors in Silicon Valley. Answering a question about whether the bank's stellar performance has driven its stock price as high as it will go, Dimon said one aspect of its revenue — much of it being very stable — is similar to a subscription-based model.


A KKR exec explained how private equity is looking in unlikely places to invest in tech companies

Private equity firm KKR just raised $2.2 billion to invest in fast-growing tech companies and it will now hunt for deals in regions far beyond Silicon Valley. 

Dave Welsh, a KKR exec leading its technology media and telecom growth equity unit, said that it would seek investments in areas such as Florida, the greater Washington, D.C., area and Atlanta, as well as the Rocky Mountain region in Colorado and other regions throughout the Midwest.

The willingness to go far and wide points to how competition for the best investments across the private equity spectrum is getting stiffer, and more PE firms are getting creative with how they deploy their capital — seeking smaller, including minority, investments.


Charles Schwab just pulled the plug on a nearly $100 billion program where rival firms paid to sell ETFs

The broker wars have uncovered some complicated alliances, and it's not always clear who's friend or foe. 

Discount broker Charles Schwab just shuttered a nearly $100 billion program where it sold products from third-party asset management giants like State Street, JPMorgan Asset Management, and BlackRock.

The wealth management and brokerage firm said in its fourth-quarter earnings results on Thursday that it discontinued the program, called Schwab ETF OneSource, "as a result of the elimination of online trading commissions for US and Canadian-listed ETFs."

The move, completed in the fourth quarter, highlights the tough reality the money-management industry has found itself in following the major brokerages' decisions to remove online trading fees for stocks and ETFs late last year.


Credit Karma has been pegged as a 2020 IPO likely, but its CEO is more focused on developing new products as the $4 billion fintech does more than just free credit scores

Credit Karma, long known for its free credit scores, launched as something of a marketing firm, connecting its users with credit cards and loans and getting paid by the banks that offered those products.

But today, it's one of Silicon Valley's hottest fintechs, with a $4 billion valuation and 100 million users. And its audience has grown fast. The 13-year-old company added 75 million users in the last five years alone and says 1 in 2 millennials are on the platform.

Reports from the Wall Street Journal and CNBC have pegged Credit Karma as a 2020 IPO candidate, though its CEO has said he sees listing as a means, not an end, and is more focused on launching new products than going public soon. Credit Karma has indicated it is profitable according to past media reports. 

As Credit Karma looks to do more than free credit scores, it's also eyeing the next cohort of spenders — Gen Z.


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NOW WATCH: WeWork went from a $47 billion valuation to a failed IPO. Here's how the company makes money.

'Grave danger': The world's biggest stock bear says it could take 30 years for stocks to be fairly valued — and says a 67% market loss is 'far more likely'

Sat, 01/18/2020 - 6:05am  |  Clusterstock

  • John Hussman — the outspoken investor and former professor who's been predicting a stock collapse — says investors are locking in dismal returns "regardless of their investment horizon."
  • He says that it could take 30 years for GDP and corporate revenues to catch up to the S&P 500's current valuation. And that's in the highly unlikely scenario stock values sit still.
  • Hussman thinks that the S&P 500 is "far more likely" to lose two-thirds of its market value than the scenario above.
  • Click here for more BI Prime stories.

At a time where stocks seemingly carve out fresh all-time highs on a daily basis, one would think that investors would be taking victory laps, high-fiving, and serving up champagne. After all, since bottoming in March 2009 the S&P 500 has enjoyed one of the most epic bull runs in history, increasing nearly fivefold in the process.

But not all think that party on Wall Street is going to continue. In fact, one renowned market bear says the music is about to stop and result in decades of pain.

That market bear is John Hussman, the former economics professor who is now president of the Hussman Investment Trust. And he's not coy in his assessment. 

"Investors should keep in mind that market valuations stand nearly three times the historically run-of-the-mill valuation levels from which stocks have historically generated run-of-the-mill long-term returns," he penned in a recent client note, adding italics for emphasis.

He contineud: "In fact, the highest level of valuation ever observed at the end of any market cycle in history was in October 2002, and even that level is less than half of present valuation extremes."

To demonstrate this perceived valuation exuberance, Hussman provides the chart below. According to his calculations, every valuation ratio is between 2.5 to 3.2 times above their historical norms. 

To Hussman, this indicates that there's a wide disconnect between valuations and underlying fundamentals.

"This doesn't mean that valuations have 'stopped working,'" he said. "It means that speculative psychology plays an important role over shorter segments of the market cycle, and that investors place themselves in grave danger if they assume, at points of extreme confidence, that valuations can be ignored."

Although Hussman has been sounding the alarm on the market's valuation for quite some time now, he still requires market internals to deteriorate in order for him to adopt or increase a bearish outlook. That happens to be the case right now.

"At present, these measures remain negative, as they have for nearly the entire period since the January 2018 market peak," he said.

Below is Hussman's proprietary measure of market internals (red line) juxtaposed against the S&P 500's cumulative total return (blue line).

He added: "It's notable that the entire net gain of the S&P 500 over the past 20 years has occurred in periods featuring uniformity in our broad measures of market internals."

So what does this all mean? Allow Hussman to explain.

"The risks that investors face don't care whether their investment horizon is 10 years, or 12 years, or 20 years," he said. "The problem is that at present valuation extremes, passive investors are locking in dismal future return prospects regardless of their investment horizon."

The chart below shows his proprietary estimated 20-year annual total return for a conventional portfolio (60% stocks, 30% bonds, 10% cash — blue line) compared against the actual subsequent 20-year returns for that portfolio (red line). According to Hussman, passive investors can expect average annual total returns of about 3% over the next two decades.

To that end, Hussman concludes this thesis with a dismal prognostication:

"So how do you get to historically run-of-the-mill valuation norms? The answer is simple: Wait nearly 30 years, allowing both the U.S. economy and U.S. corporate revenues to grow at the same rate as the past two decades, while stock prices remain unchanged, with no intervening periods of recession or investor risk-aversion, or alternatively (and far more likely), watch the S&P 500 lose two-thirds of its value over the completion of this market cycle."

Hussman's track record

For the uninitiated, Hussman has repeatedly made headlines by predicting a stock-market decline exceeding 60%and forecasting a full decade of negative equity returns. And as the stock market has continued to grind mostly higher, he's persisted with his calls, undeterred.

But before you dismiss Hussman as a wonky perma-bear, consider his track record, which he broke down in his latest blog post. Here are the arguments he lays out:

Predicted in March 2000 that tech stocks would plunge 83%, then the tech-heavy Nasdaq 100 index lost an "improbably precise" 83% during a period from 2000 to 2002

  • Predicted in 2000 that the S&P 500 would likely see negative total returns over the following decade, which it did
  • Predicted in April 2007 that the S&P 500 could lose 40%, then it lost 55% in the subsequent collapse from 2007 to 2009

In the end, the more evidence Hussman unearths around the stock market's unsustainable conditions, the more worried investors should get. Sure, there may still be returns to be realized in this market cycle, but at what point does the mounting risk of a crash become too unbearable?

That's a question investors will have to answer themselves — and one that Hussman will clearly keep exploring in the interim.

SEE ALSO: Investor Joel Greenblatt is crushing 96% of peers by adding a unique twist to the famed strategies of Warren Buffett and Ben Graham. He shared with us his winning approach.

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NOW WATCH: A big-money investor in juggernauts like Facebook and Netflix breaks down the '3rd wave' firms that are leading the next round of tech disruption

Warren Buffett's 'most gruesome mistake' was buying Dexter Shoe. Here's the story of his $9 billion error.

Sat, 01/18/2020 - 6:00am  |  Clusterstock

  • Warren Buffett's "most gruesome mistake" was buying Dexter Shoe in 1993, a Maine shoemaker that soon collapsed under pressure from cheap foreign imports.
  • The famed investor paid for Dexter with 25,203 Class A shares in Berkshire Hathaway, worth about $8.7 billion today.
  • "I gave away 1.6% of a wonderful business ... to buy a worthless business," Buffett said in his 2007 letter to shareholders.
  • "As a financial disaster, this one deserves a spot in the Guinness Book of World Records," he wrote in his 2015 letter.
  • View Business Insider's homepage for more stories.

Warren Buffett's "most gruesome mistake" was buying Dexter Shoe in 1993. The Maine shoemaker quickly became worthless; the Berkshire Hathaway shares he swapped for it are worth about $8.7 billion today.

The so-called Oracle of Omaha acquired Dexter for 25,203 Class A shares, worth $433 million at the time. 

"Dexter, I can assure you, needs no fixing: It is one of the best-managed companies Charlie and I have seen in our business lifetimes," Buffett said in his 1993 letter to shareholders. Dexter was a "business jewel," he gushed, adding that it was a "sound decision" to pay for it with Berkshire stock.

While Buffett was wildly wrong about Dexter's prospects, he did recognize the threat that would soon sink the company: cheap, imported shoes from low-wage countries. However, he joked that "someone forgot to tell" Dexter's managers and workers about that challenge, as their factory was "highly competitive against all comers."

The famed investor cheerily predicted that Dexter and H.H. Brown, Berkshire's other shoe business, would rack up more than $85 million in pre-tax earnings in 1994. "I sing 'There's No Business Like Shoe Business' as I drive to work," Buffett told his investors.

The forecast proved to be right on the money. However, Buffett changed his tune after Berkshire's shoe profits gradually shank over the next few years, falling to $17 million by 1999.

"It has become extremely difficult for domestic producers to compete effectively," the Berkshire CEO told his shareholders. "In 1999, approximately 93% of the 1.3 billion pairs of shoes purchased in this country came from abroad, where extremely low-cost labor is the rule."

Buffett responded by sourcing more shoes internationally, but he couldn't stop the bleeding.

"I clearly made a mistake in paying what I did for Dexter," Buffett admitted in his 2000 letter. "I compounded that mistake in a huge way by using Berkshire shares in payment."

In 2001, Berkshire's shoe business finished $46 million in the red as it was "swamped by losses at Dexter," Buffett told investors.

Running short of options, he trusted the bosses of H.H. Brown to revive the troubled shoemaker. When shoe profits rebounded to $24 million in 2002, he proclaimed that "the Dexter operation has been turned around."

The recovery soon ran out of steam though, leading Buffett to bemoan his mistake again in his 2007 letter.

"I gave away 1.6% of a wonderful business – one now valued at $220 billion – to buy a worthless business," he said. "To date, Dexter is the worst deal that I've made."

Reflecting on his greatest errors in his 2014 letter, Buffett pointed to Dexter again.

"The most gruesome was Dexter Shoe," he said. "When we purchased the company in 1993, it had a terrific record and in no way looked to me like a cigar butt."

"As a financial disaster, this one deserves a spot in the Guinness Book of World Records," he added.

Buffett underlined the broader consequences of Dexter's collapse in his 2015 letter.

"Our once-prosperous Dexter operation folded, putting 1,600 employees in a small Maine town out of work," he said. "Many were past the point in life at which they could learn another trade."

"We lost our entire investment, which we could afford, but many workers lost a livelihood they could not replace."

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NOW WATCH: A big-money investor in juggernauts like Facebook and Netflix breaks down the '3rd wave' firms that are leading the next round of tech disruption

Disney is scrubbing the word 'Fox' from 20th Century Fox, chipping away at Rupert Murdoch's legacy

Fri, 01/17/2020 - 10:51pm  |  Clusterstock

  • Disney removed the word "Fox" from the name of the famed 20th Century Fox movie studio, Variety magazine reported Friday.
  • The studio will now be known as 20th Century Studios, multiple outlets confirmed.
  • Changing the name appears to be a conscious effort to distance the studio from Rupert Murdoch, who sold it to Disney in early 2019.
  • In recent years, Murdoch has shed vast swathes of his media empire, which is now focused on the Fox News cable network and a stable of influential newspapers.
  • Visit Business Insider's home page for more stories.

Disney executives have axed the word "Fox" from the famed 20th Century Fox movie production studio, a move which distances the company from its former owner Rupert Murdoch.

The change was reported on Friday by Variety magazine and later confirmed by multiple other outlets.

It shows Disney stamping its authority on the company, which it bought along with a vast array of other entertainment assets once owned by Murdoch's 21st Century Fox parent company.

The replacement name for 20th Century Fox, familiar from the opening credits of countless blockbusters, will be 20th Century Studios.

A similar rebrand also took place at Fox Searchlight Pictures, which specialises in arthouse films, and will now be known as Searchlight Pictures.

According to Variety, the change is a conscious effort to distance the brands from Murdoch's legacy, which is also tied up with the Fox News network, often a lightning rod for controversy, and unpopular in Hollywood.

An unnamed Disney source told the magazine: "I think the Fox name means Murdoch, and that is toxic."

The switch helps bring home the reality that Murdoch's status as a media mogul is diminished since the sale.

His decades-long foray into movies and entertainment, which saw his legacy bound up in hits like "Avatar," "Titanic," and the Star Wars franchise, is now symbolically as well as technically over.

Separately, a few months before the Disney sale, Murdoch's 21st Century Fox also sold its stake in the Sky TV cable network, which has substantial market share in Europe.

Murdoch continues to retain substantial media influence via his ownership of Fox's TV news properties, and newspapers including The Times of London, The Sun, The Wall Street Journal, and The New York Post.

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NOW WATCH: Watch the 20 details you may have missed in the new trailer for 'Birds of Prey'

Los Angeles teachers are suing Delta after a plane dumped jet fuel on them, allegedly leaving them dizzy and nauseous

Fri, 01/17/2020 - 9:31pm  |  Clusterstock

  • Four teachers at an elementary school in California are suing Delta after one of its planes jettisoned jet fuel that landed on a neighborhood, during an emergency landing.
  • While the practice isn't uncommon, questions remain over why the pilots decided to drop the fuel at an altitude not high enough for it to vaporize before reaching the ground.
  • The four teachers allege they experienced a "lasting and severe irritation" as a result of the Tuesday incident.
  • Visit Business Insider's homepage for more stories.

Four teachers in Los Angeles, California, filed a lawsuit against Delta Air Lines on Friday, saying they felt "sick, dizzy, and nauseated" after they were drenched by jet fuel released by an Boeing 777 aircraft that made an emergency landing at nearby Los Angeles International Airport.

"Fuel penetrated their mouths and noses as well producing a lasting and severe irritation and a lasting and noxious taste and smell," the lawsuit said, according to a Friday report from USA Today. 

In the lawsuit, the four elementary school teachers, who work at Park Avenue Elementary School in Cudahy, California, said they "could feel the fuel on their clothes, flesh, eyes and skin" following the jet fuel jettison, which occurred January 14.

The Federal Aviation Administration was investigating the decision to drop the fuel from mid-air. An expert said on CNN Thursday a communication error with Air Traffic Control may be to blame for the incident, as a transcript revealed the pilot told air-traffic controllers he did not plan to release the fuel.

The flight, Delta Air Lines flight 89, was slated to travel from LAX to Shanghai, China, when it began to face unspecified engine troubles, according to the previous Insider report. 

Some 60 adults and children were treated by firefighters at the scene, but none affected were sent to the hospital, USA Today reported. Most of the reported injuries involved complaints of skin irritation. The individuals treated came from five elementary and one high school in Cudahy, South Gate, and Los Angeles.

At a press conference on Friday, one of the teachers said that she later sought medical attention for recurring symptoms following the Tuesday incident.

The lawsuit alleges negligence by Delta and does not specify the damages sought by the four teachers, USA Today reported. About 30 children at Park Avenue Elementary were reportedly playing outside when the Tuesday incident occurred. The lawsuit alleges the teachers had to tend to the injuries of their students before they could attend to their own needs. 

While previous reports cited individuals affected at multiple area schools, all four of the teachers named in the suit work at Park Avenue Elementary School in Cudahy. About half of all injuries reported with Flight 98's fuel drop occurred at Park Avenue Elementary, USA Today said. 

The FAA said while fuel dumps of this nature are not uncommon in cases when a mechanical failure or medical issue occurs during a flight, they typically happen at altitudes so the fuel will atomize before reaching the ground.

It also was not clear how much of the 24 minutes flight 89 was in the air was spent shedding the jet fuel, though the process can reportedly be lengthy. Fuel is typically jettisoned during emergency landings in order to reduce the weight of the aircraft in order avoid potential damage to the aircraft or the runway, per a previous Insider report.  

Delta reportedly sent cleaning crews to the schools that were impacted by the fuel drop, though it has not commented on Friday's lawsuit.  

Business Insider reached out to Delta, but has not heard back.

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NOW WATCH: Here's why in-flight WiFi is so slow and expensive

Rihanna and her billionaire boyfriend have reportedly broken up. Here's what we know about the Saudi businessman she was first spotted with 3 years ago.

Fri, 01/17/2020 - 5:10pm  |  Clusterstock

  • Rihanna and her billionaire boyfriend, Hassan Jameel, have broken up after three years of dating, according to Us Weekly
  • The two had quietly been dating since 2017, according to reports, and kept a very low profile.
  • Us Weekly did not report the cause of the breakup and it's likely — given the fact that the couple was notoriously private when they were together — the pair will not reveal what caused them to split. 
  • Here's everything we know about the billionaire businessman said to be Rihanna's now-ex-boyfriend.
  • Visit Business Insider's homepage for more stories.

Rihanna's love life has been a media obsession for years — which may account for why she kept her relationship with billionaire Hassan Jameel so private.

But now, Us Weekly reports that the couple has broken up after three years of dating, with no explanations yet as to why. The report comes two months after the pop star admitted to having a boyfriend, having just confirmed the relationship in November in an interview with Vogue magazine. 

"Yeah, I'm dating," she told Vogue's op-ed editor Abby Aguirre in an interview for the magazine's cover. "I'm actually in an exclusive relationship for quite some time, and it's going really well, so I'm happy."

Despite maintaining a relatively low profile, Rihanna and Jameel were spotted together on numerous occasions — the duo was even spotted at a dinner in Santa Monica, California, which included the pop star's mother. Those days, it seems, are over. 

But who is Hassan Jameel, the man who captured — for a time, at least — the heart of the biggest pop star on the planet? Here's everything we know about the billionaire said to be Rihanna's now-ex-boyfriend.

SEE ALSO: Rihanna is the world's richest female musician — from yachting trips on the French Riviera to a staff that includes a chef and personal trainers, see how she spends her $600 million fortune

DON'T MISS: The fabulous life of Rihanna, from her Barbados roots to 33 Grammy noms, and Fenty Beauty's game-changing role in makeup

Rihanna was first linked to the Saudi businessman Hassan Jameel in 2017. They were seen kissing and having coffee together during a trip to Spain.

Source: People

The identity of the "mystery man" with Rihanna wasn't clear at first. But less than a day later, he was identified as Jameel, and the two were officially declared an item.

Source: Vogue

Despite the media's immediate interest in their romance, neither the singer nor the businessman discussed the relationship in the press at first — though Rihanna's dad did tell reporters that while he was aware his daughter had a new boyfriend, he had no clue that boyfriend was a billionaire.

"She told me she had a new boyfriend about a month ago, but I didn't know who he was," the singer's father told the Toronto Sun in 2017. "I always tell her, 'Don't date an entertainer, don't date an athlete.' They are busy going this way and that way, they don't have any quality time, and they're good looking guys so women fall all over them."

He added: "He's going to have to buckle up. She's a hard-working girl. She's very independent and ambitious."

While Rihanna's net worth of $600 million (per Forbes' most recent estimate) is nothing to scoff at, Jameel is exorbitantly wealthy himself. The Saudi businessman is a Toyota heir — his family owns Abdul Latif Jameel, the largest distribution company for Toyota in several Middle Eastern countries.

Source: Forbes, Harper's Bazaar

The company was founded in 1945 by Jameel's grandfather, Abdul Latif Jameel, and named after him. Hassan Jameel is the deputy president and vice chairman for Saudi Arabia.

He heads the company's domestic operations in Saudi Arabia. He handles automotive, land and real estate, and machinery operations.

Source: Family Business Council-Gulf, World Economic Forum

He also serves as the president of Community Jameel, a charity that his family's company runs.

Community Jameel's website says the organization "operates a wide range of initiatives which promote and contribute towards positive societal change and economic sustainability" and coordinates programs "focusing on the social, cultural, educational, and economic development of individuals and communities in the Middle East region and beyond."

The Jameel family ranked fourth on Forbes Middle East's 2017 list of the Arab world's richest families, putting their collective net worth at $2.2 billion.

Subsequent rankings left off all Saudis. Forbes Middle East explained in its 2018 list that it "chose to leave off all 10 Saudis given reports of asset seizures after some 200 people, including some billionaires, were detained."

Source: Forbes Middle East

The Jameel family also owned a soccer league. The Saudi Pro League was known as Dawry Jameel when it was sponsored by the company from 2013 to 2019.

Source: Community Jameel

Before his current roles in his family businesses, Jameel worked for Toyota, in the company's Japan offices.

Source: Family Business Council-Gulf

In fact, Jameel spent several years in Japan. He received a bachelor of arts in international economics from Sophia University in Tokyo before attending the London Business School for his MBA.

Source: Family Business Council-Gulf

He's also a polyglot, fluent in English, Arabic, and Japanese.

Source: Family Business Council-Gulf

Jameel was previously married to Lina Lazaar, a Tunisian art expert. The two wed in 2012 and divorced in 2017.

Source: The Sun

Before his romance with Rihanna, Jameel was also linked to supermodel Naomi Campbell.

Source: Harper's Bazaar

Over the past three years, the duo kept a very low profile. In August 2019, a source told People that the pair went out for a "lovely dinner evening" with Rihanna's mom and brother in Santa Monica, California. A few days later, paparazzi got photos of the two looking "cuddly" during dinner at Wally's in Beverly Hills.

Source: People, Elle

In one of their first sighted outings, Rihanna and Jameel celebrated Halloween together in Boston in 2017. Witnesses told Us Weekly that the singer was dressed as Kylo Ren from "Star Wars" and that Jameel was in a penguin costume.

"Rihanna and Hassan were canoodling all night," a source told Us Weekly. "She ordered extra pasta to take home because she said she often gets hungry around 2 a.m."

They also attended a Los Angeles Lakers game in February for her 31st birthday — one of the rare public outings where they were actually caught on camera together.

Source: W magazine

In June 2019, the couple took a trip to the Amalfi Coast, where they were photographed cuddling, with a group that appeared to include other members of the Jameel family.

Source: Elle

Shortly before that trip, Rihanna told The New York Times that earlier in 2019, she moved to London ("where she is closer to the team working on Fenty, which is designed in Paris and manufactured in Italy," The Times said) — though many speculated that the move was so she could be closer to Jameel, who reportedly lives there.

Source: New York Times, Metro

In a conversation with her "Ocean's 8" costar Sarah Paulson for Interview magazine in June 2019, Rihanna refused to confirm who she was dating — "Google it," she said — but did say that "of course" she was in love.

When Paulson asked whether she was going to get married, Rihanna paused, then said: "Only god knows that, girl. We plan and god laughs, right?"

She also explained how she prioritized a blossoming relationship amid her busy career.

"I got into a new relationship, and it matters to me," she said. "It was like, 'I need to make time for this.' Just like I nurture my businesses, I need to nurture this as well. I'll shut things down for two days, three days at a time. On my calendar we now have the infamous 'P,' which means personal days. This is a new thing."

Rihanna did confirm, however, that was in an "exclusive relationship" during an interview for Vogue's November 2019 cover story.

"Yeah, I'm dating," she told Vogue's Abby Aguirre. "I'm actually in an exclusive relationship for quite some time, and it's going really well, so I'm happy."

Rihanna also said she does want kids: "Without a doubt."

Source: Vogue

But on January 17, 2020, Us Weekly reported that Rihanna and Jameel had split after nearly three years together.

No details have been released as to what caused the breakup, but perhaps it will inspire some songs for her next album.

Source: Us Weekly

THE AI IN INSURANCE REPORT: How forward-thinking insurers are using AI to slash costs and boost customer satisfaction as disruption looms

Fri, 01/17/2020 - 5:02pm  |  Clusterstock

The insurance sector has fallen behind the curve of financial services innovation — and that's left hundreds of billions in potential cost savings on the table.

The most valuable area in which insurers can innovate is the use of artificial intelligence (AI): It's estimated that AI can drive cost savings of $390 billion across insurers' front, middle, and back offices by 2030, according to a report by Autonomous NEXT seen by Business Insider Intelligence. The front office is the most lucrative area to target for AI-driven cost savings, with $168 billion up for grabs by 2030.

There are three main aspects of the front office that stand to benefit most from AI. First, Chatbots and automated questionnaires can help insurers make customer service more efficient and improve customer satisfaction. Second, AI can help insurers offer more personalized policies for their customers. Finally, by streamlining the claims management process, insurers can increase their efficiency. 

In the AI in Insurance Report, Business Insider Intelligence will examine AI solutions across key areas of the front office — customer service, personalization, and claims management — to illustrate how the technology can significantly enhance the customer experience and cut costs along the value chain. We will look at companies that have accomplished these goals to illustrate what insurers should focus on when implementing AI, and offer recommendations on how to ensure successful AI adoption.

The companies mentioned in this report are: IBM, Lemonade, Lloyd's of London, Next Insurance, Planck, PolicyPal, Root, Tractable, and Zurich Insurance Group.

Here are some of the key takeaways from the report:

  • The cost savings that insurers can capture from using AI in the front office will allow them to refocus capital and employees on more lucrative objectives, such as underwriting policies.
  • To ensure that AI in the front office is successful, insurers need to have a clear strategy for implementing the tech and use it as a solution for specific problems.
  • Insurers are still at different stages when it comes to implementing AI: a number of them need to find ways to appropriately build their strategies and enable transformation, while the others must identify how to move forward with their existing strategy.
  • Overall, incumbents should focus on a hybrid model between digital and human to ensure they're catering to all consumers.

 In full, the report:

  • Outlines the benefits of using AI in the insurance industry.
  • Explains the three main ways insurers can revamp their front office using the technology.
  • Highlights players that have successfully implemented AI solutions in their front office.
  • Discusses how insurers should move forward with AI and what routes are the most lucrative option for players of different sizes.

Interested in getting the full report? Here are two ways to access it:

  1. Purchase & download the full report from our research store. >> Purchase & Download Now
  2. Subscribe to a Premium pass to Business Insider Intelligence and gain immediate access to this report and more than 250 other expertly researched reports. As an added bonus, you'll also gain access to all future reports and daily newsletters to ensure you stay ahead of the curve and benefit personally and professionally. >> Learn More Now

The choice is yours. But however you decide to acquire this report, you've given yourself a powerful advantage in your understanding of AI in insurance.

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A Goldman Sachs client poll finds 87% expect Trump to win the next election

Fri, 01/17/2020 - 3:39pm  |  Clusterstock

  • Goldman Sachs surveyed dozens of its clients and found that 87% expected President Donald Trump to win the 2020 election.
  • The bank's strategists polled attendees at a conference this week and received an average of 160 responses to their questions.
  • Only 5% of respondents expected a US recession this year, 45% expected a bear market in 2021, and 67% expected the Federal Reserve to hold interest rates steady this year.
  • View Business Insider's homepage for more stories.

Goldman Sachs surveyed dozens of its clients and found that the vast majority expected President Donald Trump to win a second term in office.

The banking titan's investment researchers polled attendees of its Global Strategy Conference in London this week, garnering an average of 160 responses to each of their questions. Asked whether Trump — who was recently impeached by the House of Representatives and now faces a Senate trial — would win the 2020 election, 87% of respondents said they expected him to triumph. The bank published its results in a research note Thursday.

Of course, Goldman's clientele is definitely not representative of the American electorate, and the betting site Oddschecker gives slimmer odds of a Trump victory, at 4/5.

Goldman's US strategists haven't predicted who will win the election but have warned that if one party holds the House and the Senate and Trump's 2017 tax cuts are rolled back, corporate earnings per share could drop by 7% next year — a sharp deviation from the strategists' baseline estimate of a 5% rise.

The strategists also surveyed conference attendees on when the next US recession would hit. Only 5% said this year, while 35% were bracing for one in 2021, and 38% expected it in 2022. Similarly, Goldman's economists put the odds of a recession in the next 12 months at under 20%.

Goldman also polled the crowd on the stock market and the Federal Reserve.

About 60% of respondents expected US equities to return 0% to 10% this year, but 45% predicted a bear market in 2021. Goldman's strategists expected positive returns on equities in the coming months.

More than two-thirds of respondents predicted the Federal Reserve would hold interest rates steady this year, after the central bank cut them three times last year. Only 4% expected it to raise rates.

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Travelers from China are being screened at US airports for a mysterious new virus that's killed 2 and sickened dozens

Fri, 01/17/2020 - 3:37pm  |  Clusterstock

  • Passengers from China arriving in Los Angeles, San Francisco, and New York will be screened by the Centers for Disease Control and Prevention for a mysterious new virus that's killed two and sickened dozens in China.
  • The virus, which is similar to SARS and causes pneumonia-like symptoms, was identified late last year in Wuhan, China, a city 700 miles south of Beijing, and has been detected in Thailand and Japan.
  • Most of the patients are thought to have contracted the virus from animals, but person-to-person transmission appears to be possible, albeit less common.
  • Visit Business Insider's homepage for more stories.

Federal health officials said on Friday that they would begin screening passengers arriving at three US airports from Wuhan, China, for signs of infection from a mysterious and potentially deadly new virus.

The Centers for Disease Control and Prevention (CDC) said it would deploy about 100 staff members to San Francisco International Airport, Los Angeles International Airport, and John F. Kennedy International Airport in New York City to help screen incoming passengers.

The screenings at three airports, which receive most of the travelers from Wuhan to the US on direct and connecting flights, will start Friday evening and Saturday morning. CDC officials will look for symptoms such as coughing and difficulty breathing, and will check passengers' temperatures using an infrared thermometer.

The new screening marks the first time that the CDC has moved to proactively check arriving travelers since the 2014 Ebola outbreak.

The new virus, called "2019-nCoV" by the CDC, is a coronavirus, the type of virus behind severe acute respiratory syndrome, or SARS.

2019-nCoV, which causes flu and pneumonia-like symptoms, was first observed late last year. The virus has killed two people and sickened dozens in China. Two cases have also been reported in Thailand, and one in Japan, both linked to travelers from Wuhan.

"Investigations into this novel coronavirus are ongoing and we are monitoring and responding to this evolving situation," Dr. Martin Cetron, director of the CDC's division which observes and manages global migration and quarantine needs, said in a press release.

The screenings come as millions of people are traveling across China and overseas for Lunar New Year, which starts on January 25. The World Health Organization said in a statement that additional cases in other countries were likely, "considering global travel patterns."

More than 60,000 people arrived in the US from Wuhan, a city about 700 miles south of Beijing, in 2019, the CDC said.

Chinese health officials reported that most, but not all, of the infected people had been near a large market where livestock was present, suggesting that the virus had jumped the species barrier and been transmitted directly from the animals. Person-to-person transmission appears more difficult, CDC officials said.

Several hundred healthcare workers who have treated patients have not shown any signs of contracting the virus.

SEE ALSO: 'This airplane is designed by clowns': Damning Boeing emails reveal internal complaints made about 737 Max safety and information being covered up

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The Capital One Spark Cash earns 2% back on all your spending, and it's currently offering a sign-up bonus worth up to $2,000

Fri, 01/17/2020 - 3:07pm  |  Clusterstock

  • If you apply by January 27, the Capital One® Spark® Cash for Business is offering up to $2,000 in cash bonuses for signing up and meeting a hefty minimum spending requirement.
  • Specifically, you'll earn $500 in bonus cash when you spend $5,000 on your card within the first three months, followed by another $1,500 in bonus cash when you spend $50,000 during the first six months.
  • The Capital One Spark Cash lets you redeem rewards to cover any purchases you want.
  • You'll also earn an unlimited 2% back with this card without having to keep track of bonus earning categories or earning caps.
  • See Business Insider's picks for the best small-business credit cards »

With so many lucrative business credit card offers out there today, it can be difficult to decide which card to use for the bulk of your business spending. Not only will you find business cards with huge sign-up bonuses, but you'll also find ones with generous fixed-rate rewards or tiered earning rates that can help you earn more points on specific business purchases.

The Capital One Spark Cash is a business card you should consider if you prefer to earn a fixed rate of rewards (as opposed to earning bonus rewards on certain spending categories) and have some flexibility in how you redeem your points.

Currently, you can even earn $2,000 in bonus cash with this card if you can spend at least $50,000 within six months of account opening. That's a high threshold to meet if your business has few expenses, but it may not be that difficult if you can cover operational costs, payroll, and more with plastic. This bonus is only available until January 27, so apply soon if you're interested.

Should you sign up? Keep reading to learn how the Spark Cash card's new offer works and how it compares to other business credit cards.

Keep in mind that we're focusing on the rewards and perks that make these credit cards great options, not things like interest rates and late fees, which will far outweigh the value of any points or miles. It's important to practice financial discipline when using credit cards by paying your balances in full each month, making payments on time, and only spending what you can afford to pay back. 

Earn up to $2,000 in cash back: Click here to learn more about the Capital One Spark Cash » Capital One Spark Cash details

Sign-up bonus: Earn $500 in bonus cash when you spend $5,000 within three months; earn another $1,500 in bonus cash when you spend $50,000 on your card within six months of account opening

Earning rate: Earn an unlimited 2% back for each dollar you spend

Annual fee: $0 the first year; $95 thereafter

Foreign transaction fees: None

Fee for employee cards: None

Welcome bonus

The Capital One Spark Cash is currently offering the most valuable sign-up bonus among business credit cards that earn cash back. The catch for this bonus is obvious, however. To earn the full bonus ($2,000 in bonus cash), you'll need to spend $5,000 within three months and $50,000 within six months of account opening.

This means you would need to have at least $8,334 in business expenses you could charge to your business credit card each month for six months straight. That's a lot of spending for some businesses, but it may be totally feasible for others.

Before you sign up for this card, it will help to figure out how much your business spends on average. If you spend a lot less than $8,334 per month on business expenses, pursuing the bonus on this card may be a lost cause.

Flat earning rate

One big benefit of this card is the fact you earn a flat 2% back for each dollar you spend. The rewards you earn are unlimited as well, so you'll never have to worry about earning caps.

This puts the Capital One Spark Cash ahead of other flat-rate business cards like the Ink Business Unlimited Credit Card, which offers a flat 1.5% back for each dollar you spend. The Capital One Spark Cash does charge a $95 annual fee after the first year whereas the Ink Business Unlimited does not, but the additional 0.5% of rewards can more than make up for it.

Using rewards

The Capital One Spark Cash lets you earn a flat 2% cash back for each dollar you spend. From there, you can redeem for statement credits to cover any purchases you want.

Having the option to redeem for statement credits makes things easy. You could pay for airfare, hotels, rental cars, or even holiday shopping with your credit card then use points to cover the purchases at a rate of 1 cent each. This means the sign-up bonus on this card is worth $2,000 in anything you want.

Note: Be sure not to confuse the Capital One Spark Cash with the Capital One® Spark® Miles for Business. The Capital One Spark Miles offers the same 2% in rewards for all your spending, but in the form of miles that you can choose to transfer to a handful of airline partners.


The Capital One Spark Cash offers a surprising number of benefits for cardholders, and it all starts with the fact you get free employee cards. If you have employees who frequently make business purchases, getting each of them an employee card can help you earn rewards and reach the threshold for this card's bonus a lot faster.

Other cardholder benefits include no foreign transaction fees on purchases made abroad, purchase protection against damage or theft for select items, and extended warranties. You also get auto rental damage waiver coverage when you use your credit card to pay for a rental car.

Finally, Capital One will send you a year-end summary that breaks down your business spending by category. This summary can help you assess your business expenses and cash flow and, best of all, it's free.

How does the Capital One Spark Cash compare to other cards?

This card's current sign-up bonus is incredibly intriguing, but you have to keep the high minimum spending requirement in mind. The reality is that many small businesses do not have $50,000 in expenses they can charge to a credit card within six months.

If you do have that much business spending, however, you should still consider how that spending would translate into rewards with other cards.

The following chart breaks down a few comparable business cards and how they work:

As you can see, the Capital One Spark Cash blows other comparable business cards out of the water the first year. Keep in mind, however, that you'll need to spend $50,000 within your first six months from opening the card to get the full value.

Also remember that the rewards you earn with this card are rather limited. If you want to travel, you may want to consider the Capital One Spark Miles for Business card since it's offering the same epic sign-up bonus right now, but in the form of miles, not cash back. The Capital One Spark Miles also lets you earn 2x miles on everything you buy, and you can redeem rewards to cover any travel expenses or transfer to a handful of airline partners.

The January 27 end date for the Spark Cash card's elevated sign-up offer is approaching, so don't wait too long to apply if you're interested.

Earn up to $2,000 in cash back: Click here to learn more about the Capital One Spark Cash »

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Dave & Buster's skyrockets 16% after private equity fund KKR says it's pushing for changes at the chain (PLAY)

Fri, 01/17/2020 - 2:55pm  |  Clusterstock

Shares of Dave & Buster's surged as much as 16% Friday to the highest the stock's been since June after KKR, a private-equity firm, disclosed in a Securities and Exchange filing that it is pushing for changes at the chain. 

It's unusual for a firm like KKR to publicly release such plans. The firm also said in the filing that it holds a 10.7% stake in Dave & Buster's that includes shares and options. That's an increase in KKR's stake in the restaurant chain — a passive filing dated September 30 showed the firm held a 2.65% stake. 

KKR has held and intends to continue to engage in discussions with management or the board of directors of Dave & Buster's about its business, operations, strategy, plans, and prospects, according to the filing. It also said that it might speak with stockholders or large security holders and could take actions such as board or management changes, or transactions including a merger, reorganization, or liquidation. 

The stock gains and news of KKR's involvement come after a less-than-stellar year for Dave & Buster's. In 2019, the stock shed nearly 10% while the S&P 500 gained 29%. The company suffered a steep drop in June when its quarterly earnings report showed an unexpected decline in same-store sales.

Dave & Buster's has gained roughly 5% year-to-date through Thursday's close.

Disclaimer: KKR is a major shareholder of German media group Axel Springer, which owns Business Insider.




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I asked my financial planner for help buying my second home, and he recommended a 3-part strategy that worked

Fri, 01/17/2020 - 2:51pm  |  Clusterstock

When my husband and I first got the idea that we might be interested in upgrading to a new house, we both knew there was one person we would need to call before we put anything into motion: our financial planner.

Since we've been working with our financial planner for three years now, we've come to count on his guidance and expertise when it comes to making big financial decisions. 

Having a financial planner isn't necessarily about having someone tell you what to do with your money, but it helps to get an opinion from a neutral source who just so happens to also be educated on all things finance. 

We weren't really sure what to expect on the call, since this would be our first experience selling a house and buying a new one with so many additional budgetary considerations. After all was said and done, though, our financial planner was able to help us home in on some very important considerations when putting together our new-home budget.

1. What items in our budget were non-negotiable?

Since our goal with a new house was to make a few upgrades — like finding a place with a larger backyard, a dedicated guest room, and a home office for me — we knew that we were likely going to be looking at places with higher mortgages than what we were currently paying. 

In order to help us determine how much extra home we could afford, our planner combed through our budget with us to determine what items would remain the same each month, and where we had some wiggle room. 

For example, some of our non-negotiable monthly budgetary items included:

Car-related items: What we pay for our car each month, plus gas and upkeep, were all expenses that wouldn't change based on moving to a new home.

Kid-related items: We have a number of areas where we spend for our two girls — like preschool payments, 529 contributions, and a miscellaneous category for things like clothes or swim lessons, diapers, etc. — and that number needed to remain relatively the same.

Retirement: Our financial planner made it pretty clear that putting less money into either of our retirement funds in order to pay for a bigger house wasn't a good idea. With future retirement goals in mind, we knew that this monthly budget item would need to remain the same.

Pet care: No matter where we lived, our cat would need the same care — like food and vet visits, etc.

Once we put together a list of items from our budget that wouldn't change, we had a better idea of how much wiggle room we might have for a monthly mortgage payment.

2. Of our negotiable budgetary items, how much were we willing to take away from each?

Our planner helped us realize that just because certain budget items were flexible — like miscellaneous spending categories we have built into our budget for buying home-related items, our general savings, and individual spending — that didn't mean we should take away from them completely to fund a new house. 

In other words, just because we could theoretically take $1,000 from what we put into savings every month doesn't mean that we should. 

He helped us to see that even if you can afford a home upgrade, it doesn't mean you should. By planning to draw a smaller amount of money from each of our discretionary budget items, we'd be able to keep funding those aspects of our lives, while also hopefully coming up with a decent amount of extra cash for an additional mortgage payment each month.

3. How much of a down payment could we afford?

The down payment is always an important factor to consider when you're buying a home. Experts still recommend putting down 20% as a down payment, even though it's possible to get a mortgage without putting down that amount. 

Still, that aside, the fact remains that the more money you can afford to put down on your home, the less your monthly payments will be, and the less you'll pay in interest over the life of your loan in general. 

Lucky for us, selling our current home would provide us with an immediate influx of cash, but it wasn't as simple as that. Our planner helped us run some numbers to consider how much we might actually make on the sale of our home, assuming a number of factors including:

Estimated sale price: It's good to include some fluctuations in you calculations here, just in case.

Closing costs: Closing costs are traditionally higher for the people buying the home (which we would be paying on the other end), but when it came to selling our home, things like title, recording, and HOA fees would all take chunks out of our final take-home amount.

Realtor fees: Each state has different laws when it comes to buying and selling a home, but in our case, the seller (us) pays both the selling and buying real estate agent fees. 

In our case, this would be 5.6% of the purchase price of our home — a huge number, but worth it in our mind for all the work our realtor put into helping us sell our home quickly and for the most money we could get.

Mortgage balance: We were lucky enough to have been able to put 20% down on our first home when we bought it, and at the time we sold it we had been living in it for a little over three years. 

That meant we had a decent amount of equity in the home for ourselves, but we would still owe the mortgage company the majority of what we made on the sale of the home.

With all of that information in mind, we were able to come up with an estimate for what we might have left over for a down payment. Then, with a down payment in mind and an idea of how much wiggle room we had in our budget each month for an additional mortgage payment, we were able to start looking at homes within a price range that we knew we could afford.

At the end of the day, even though I'm a person who enjoys working the numbers to make a financial goal work, in this particular situation, I was more than happy to have a professional by our side, walking us through some of the particulars that we might not have otherwise considered. 

We did eventually buy a house and now we're now two months into our new home, and I can say that the shift hasn't been too painful, monetarily, because we were so prepared.

Moving with 2- and 3-year-old kids, on the other hand ... that's a whole different story.

Ask a financial planner for help buying a home. Use SmartAsset's free tool to connect with a qualified professional near you »

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Thanks to a service called Plastiq, you can pay your mortgage with a credit card — here's how I used it to earn $2,000 toward travel

Fri, 01/17/2020 - 2:35pm  |  Clusterstock

In 2017, I had a singular focus: paying off my home mortgage and becoming entirely debt-free.

With enough persistence, I finally achieved that goal in early 2018. All of a sudden, I went from someone with a mortgage to someone who owns their home outright at the age of 38. I was pretty happy about the situation because, well, I hate debt. And now for the first time in my life, all "real debt" was behind me.

Even better, I managed to earn $2,000 in travel rewards while paying off my home mortgage. I accomplished this goal by funneling my mortgage payments through a service called Plastiq, then paying with a travel credit card that offers 2 times points for each dollar you spend.

Read more: The best credit cards with intro APR offers

To be 100% clear, I paid my mortgage off in chunks of $5,000 or $8,000 at a time, and I never paid a dime in interest along the way. I made extra payments only when I had cash in the bank to pay my credit card off at the end of the month because it would be downright silly to transfer low-interest debt to a high-interest credit card.

Now that my home is paid off (and we also paid off our first rental property that we bought in 2008), I have only one debt left: the mortgage on a second rental property we own. I have owned this property since 2007, and it's the first house my husband and I bought together. I owe about $40,000, and I'm using the same strategy I did with my house. I'm funneling payments through Plastiq, and I'm paying with my Barclaycard Arrival Plus World Elite Mastercard.


While the Barclaycard Arrival Plus World Elite Mastercard is no longer available to new customers, you could do something similar with a different credit card. Here's how I'm doing it and how you might do this too.

Keep in mind that we're focusing on the rewards and perks that make these credit cards great options, not things like interest rates and late fees, which will far outweigh the value of any points or miles. It's important to practice financial discipline when using credit cards by paying your balances in full each month, making payments on time, and spending only what you can afford to pay back. 

Earn 'fee-free dollars' from Plastiq

Plastiq is an online service that lets you pay any bill with a credit card, including bills you can't normally pay with plastic, like rent or your mortgage. This service does charge a 2.5% fee to use it, but there's a workaround.

For each person you refer to the program who pays at least $500 in bills through Plastiq, you earn $1,000 in fee-free dollars that you can use to pay your own bills without any fees.

Also note that the person you refer also gets $500 in fee-free dollars, so there's some incentive for them to sign up through you.

That's how I was able to pay off my home mortgage without any fees and how I'm continuing to pay off my rental-property mortgage without paying them. I'm a blogger, so I have referred hundreds of people to Plastiq over the years. Nobody expects you to have hundreds of referrals, but it may not be that difficult to refer a few people per month using your own unique referral link.

If your mortgage payment is $2,000 per month, for example, you would have to refer only two new customers per month in order to earn $2,000 in "fee-free dollars." From there, you could pay your mortgage payment with a qualifying rewards or travel credit card. Keep in mind, however, that this is a good idea only if you have the cash — and the discipline — to pay your credit-card bill in full.

Get the right credit card

Plastiq lets you pay pretty much any bill with any type of credit card, whether you have an American Express, Visa, Mastercard, or Discover. However, they do have some rules when it comes to paying your mortgage. Specifically, you cannot make a mortgage payment through Plastiq using American Express or Visa.

Fortunately, there are a ton of other rewards credit cards that would work quite well. You could pick up the Citi Premier℠ Card, which is a Mastercard. With the Citi Premier, you can earn a substantial sign-up bonus within the first few months along with ongoing rewards good for travel, gift cards, and more.

You could also apply for the Citi Double Cash Card, which would net you 2% back for each dollar you make in mortgage payments. The card earns 1% cash back when you make a purchase and 1% cash back when you pay your bill. There's no annual fee.

Another card to consider is the Capital One Savor Rewards Credit Card, which is also a Mastercard. This card gives you an initial cash bonus of $300 after you spend $3,000 on your card within three months of opening an account. You'll also earn 4% back on dining and entertainment, 2% back at grocery stores, and 1% back on all other purchases. A $95 annual fee applies, but this fee is waived the first year.

Read more: Business Insider's list of the best cash-back credit cards

Pay your credit card off each month

To end up "ahead" with the rewards you earn, you'll need to pay your credit-card bill in full each month. Since the average credit-card interest rate is well over 17% APR, paying your mortgage with a credit card and carrying a balance makes zero sense.

You should strive to remain debt-free if you plan to use credit cards to earn rewards. If you wind up in debt, you'll be worse off than when you started. Trust me when I say that if debt is inevitable, the rewards you can earn with a credit card just aren't worth it.

Earn cash back: Click here to learn more about the Citi Double Cash card »

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NOW WATCH: The surprising reason Americans drop a ball on New Year's Eve

Economists are slashing 4th-quarter GDP forecasts — citing poor holiday sales and warm winter weather

Fri, 01/17/2020 - 2:25pm  |  Clusterstock

Economists are slashing their expectations for fourth-quarter GDP growth as holiday sales come in lower than projected and utility output flounders.

Bank of America analysts on Friday cut their quarterly growth projection by 0.2 percentage points, to 2%, slowing from the third quarter's 2.1% growth and matching the rate seen in the second quarter of 2019.

December's retail sales excluding autos climbed by 0.7%, but control-group sales in November and October were both revised to mild drops after initial reports showed healthy gains.

The control group — which consists of sales except for car dealers, building-materials retailers, gas stations, office-supply stores, and a handful of other categories — is often used as a more precise way to measure consumer spending. The metric "is critical as it feeds directly into our GDP tracking estimate," the Bank of America team led by Michelle Meyer wrote.

JPMorgan Chase echoed that on Friday, cutting its fourth-quarter real GDP estimate to 1.5% from 2% as retail data signaled "weaker goods spending." The economic reading is also set to suffer from lower-than-expected utility use in the last months of the year, the economist Daniel Silver added, driven by "the unusually mild weather" in December.

Even a Federal Reserve bank is hedging its expectations for year-end economic growth. The Atlanta Fed's GDPNow indicator, which projects real GDP growth as major economic data is released, was lowered to 1.8% from 2.3% on Thursday following the release of December's worse-than-expected retail metrics.

The central bank maintained its 1.8% estimate through Friday morning, noting that slowing personal-expense growth was "partly offset" by an increase in residential investment. Construction data released Friday showed that housing starts jumped 16.9% in December to the highest level in 13 years, driven by low mortgage rates and resilient consumer confidence.

Numerous banks cut their 2020 GDP estimates in mid-December after Boeing announced it would halt 737 Max production in January. The bestselling model was grounded worldwide after two crashes, in late 2018 and early 2019, killed 346 people.

The pause in inventory buildup will drag on GDP in the first quarter of the new year, JPMorgan said December 17, adding that it could cut roughly 0.5 percentage points from the benchmark figure.

Treasury Secretary Steven Mnuchin on Sunday addressed the jet's production halt and effect on economic growth. The official's estimate for 2020 GDP was higher than other economists' but still took a hit from Boeing's decision.

"For this year, we've been looking at 2.5% to 3%. As I said, it may be closer to 2.5% because of the adjustment of the Boeing numbers," Mnuchin told Fox News.

Now read more markets coverage from Markets Insider and Business Insider:

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Financial therapy isn't just for people struggling with money — it's for anyone who wants to understand how their thoughts affect their bank account

Fri, 01/17/2020 - 2:24pm  |  Clusterstock

In addition to helping you manage your budget, invest your money, and reduce financial risk in your life, some financial planners — like Utah-based planner Dave Lowell — are also focused on helping their clients develop healthier mindsets around money so they can meet their financial goals and live more balanced lives.

Lowell calls this strategy financial therapy, and he says it's helped many of his clients gain control over areas of their lives that once felt overwhelming.

Financial therapy isn't about numbers — it's about thoughts

Financial therapy is typically an informal conversation clients have with their financial advisers or financial therapists about habits and mindsets that might be interfering with their financial goals or causing conflict or unhappiness in their lives. Basically, this conversation analyzes what you believe about money and how those beliefs affect your behavior.

Often, Lowell says, the best way to do this is to go back and examine some of your earliest memories with money and what lessons you learned — for example, maybe your parents habitually paid bills late, and as a result, you feel a sense of insecurity around your budget. "Understanding these money scripts or unconscious beliefs will help you understand why you do what you do with money and what emotions come with it," Lowell says.

It's easy to compartmentalize our financial lives, but the truth is, our money and our emotions are inextricably linked. Financial therapy sets aside the logic of your financial situation and dives into the "why" behind your financial behaviors. Understanding these emotions can help you gain perspective on your habits and routines so you can ultimately change them.

"Why don't we do what we know what we should do? What keeps us from progressing to the next level and building real wealth? Financial therapy analyzes the subconscious beliefs we have about money so we can consciously override them and act more rationally," Lowell says.

Financial therapy includes discussions around work, relationships, and happiness

Lowell says he frequently sees conflict between couples in which each partner has their own, contradictory belief about money, which can result in considerable relational and financial stress. "This often results in no budgeting, because it's too frustrating, and no real progress towards goals, since the topic is too sensitive to discuss," he says.

Another issue he sees often is over-spending, which he says is usually a result of believing that money, and spending money, will make you happier. "So you spend more to get a rush, but then the guilt sets in that you aren't being responsible with money and doing what you should be doing," he says. "So then you just spend more to fix that problem."

Another common mindset he helps clients with is workaholism — the thought that once you hit a certain income, or have a certain amount of money, then you will be happy and you will have "arrived." "This results in sacrificing things that are actually important to your life in the present, like relationships or hobbies, in order to get to that predetermined point faster," Lowell says. "When you do arrive — if you haven't moved the goal posts, so to speak — you usually find you have sacrificed everything and still aren't happy."

Therapy isn't just for people struggling with money

Even if you don't have "out of control" financial behavior, Lowell says taking time to discuss your financial history and perspectives can be a great way to see your situation clearer so you can come up with strategies for managing your money that make the most sense for you.

Lowell shares an example of a couple who had struggled with feeling guilty for spending money on themselves. "As we talked through why they felt that way, they realized it was because they felt they 'should be saving money' instead of spending it, which had been drilled into their heads at a young age," Lowell says.

In response, Lowell broke down their financial situation for them: They had plenty of savings and were being responsible with their money, so they could make room in their budget for spending without guilt.

"This shifted their mindset and let them feel joy about spending money on things they love," he says, "which has had a real day-to-day impact on their lives." 

Need help with your money? SmartAsset's free tool can find a financial adviser near you »

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Private-equity firms are focusing more on running companies than financial engineering — and that could help their PR problem

Fri, 01/17/2020 - 2:23pm  |  Clusterstock

  • Private-equity firms are facing a deal environment that, while challenging in their pursuit of returns, might just help stave off scrutiny of the industry.
  • Private equity has been blasted with criticism from celebrities and Democratic presidential candidate Sen. Elizabeth Warren. 
  • In 2019, private equity became a punching bag on late-night talk shows and the Twitter feeds of some politicians, who said the industry profits off US businesses at the expense of laid-off workers.
  • Firms have said they can add value to companies, but a report from PitchBook indicates private-equity firms will likely have to change their ways. 
  • Visit BI Prime for more stories.

Private-equity firms are facing a deal environment that, while challenging in their pursuit of returns, might just help stave off scrutiny of how they make money.

The industry has attracted criticism from celebrities, such as Taylor Swift, and Democratic presidential candidate Sen. Elizabeth Warren.

In 2019, private equity became a punching bag on late-night talk shows and the Twitter feeds of some politicians, who said the industry profits off US businesses at the expense of laid-off workers.

Private-equity firms have said they can add value to companies. But a new report from PitchBook indicates they will likely have to change their ways in light of a tougher deal market. 

PE firms are looking to improve operations 

The report said private-equity firms have had to get creative with how they deploy capital as investors increasingly pour money into the private markets in a search for yield after years of ultralow interest rates. 

Opportunities are difficult to find, and prices are rising for the best investments as multiple private-equity firms bid for companies.

This has meant private-equity firms are, in many cases, engaging in investments that eschew the traditional private-equity takeover: Instead of buying a whole company with a large debt load, they are settling for minority stakes and trying to improve operations.

"Improving IT, marketing, the supply chain and more has allowed operations, rather than financial engineering, to drive a mounting portion of PE returns," the PitchBook report said. "Not only do these strategies help PE firms propel returns ... they also address persistent public and political criticism." 

Read more: Private equity giants like Blackstone and KKR are loading up on industry specialists to help squeeze out returns, and that's creating a new power dynamic inside the firms

Public-relations battle heats up

With the 2020 presidential race heating up in the coming months, private equity is expected to remain a focus of politicians, with Warren saying private equity is a vivid illustration of how Wall Street needs reform. 

Specifically, Warren has criticized the management fees private-equity firms charge their portfolio companies, likening them to vampires that suck the life out of companies.

Adding fuel to the fire, Swift has railed against private equity's influence in the music business after talent manager Scooter Braun bought the rights to her music in a deal supported by the private-equity firm The Carlyle Group. 

In a speech at the Billboard Women in Music event this month, Swift called private equity "a potentially harmful force" to musicians and said firms were "buying up our music as if it is real estate."

Private-equity firms, meanwhile, have commissioned their own lobbyists and public-relations specialists in Washington to pull up research that illustrates how private equity has actually helped the American economy.

Read more: Elizabeth Warren's attack on private equity could have a surprising group of backers: Investors in private equity

The PitchBook report pointed to a third-quarter earnings call in which Blackstone CEO Stephen Schwarzman addressed some of the public criticism of the private-equity industry.

He said Blackstone's portfolio companies have added more than 100,000 net jobs during its ownership over the past 15 years.

"We are incredibly proud of what we do at Blackstone and the vital role we play in society," Schwarzman said on the call. "For example, the very strong returns we generate, particularly in the current low interest-rate environment, enable teachers, police officers, firemen, and other public and corporate-sector employees to retire with sufficient savings and secure pensions."

Blackstone, which has more than half a trillion dollars of assets under management, announced on Friday that it would hold its fourth-quarter and full-year investor conference call on January 30. 

Some firms modify investment approach

The PitchBook report held up KKR as an example of one private-equity firm that has modified its investing approach in a way that focuses on operational improvements within a portfolio company.

KKR and some other firms have done this by structuring a private-equity deal in such a way that provides employees with ownership stakes in the company — as well as bonuses tied to performance, the report said. In the past, these incentives were reserved exclusively for senior leadership.

PitchBook said it sees the private-equity industry continuing to evolve its investment approach, especially as the public criticism of the industry ramps up in 2020. 

"Continued scrutiny and backlash surrounding a lack of transparency, the fees charged to portfolio companies, ruthless tactics and asymmetric outcomes when PE firms succeed while portfolio companies fail will likely push the industry to change in some ways going forward," the report said. 

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5 credit cards with welcome bonuses of 50,000 points or more, so you can get a head start on your warm-weather travel plans

Fri, 01/17/2020 - 2:16pm  |  Clusterstock

Most people choose a rewards credit card that will help them earn miles or points for a favorite travel brand or program. Earning miles and points for each purchase can lead to huge value, and many rewards credit cards also offer new cardholders an intro bonus that could get you a free flight, hotel night, or more.

Here's a look at seven of the best bonuses that can get you 50,000 points or more. 

If you want even higher welcome offers, be sure to check out Business Insider's list of the best credit card offers for 100,000 points or more. Business Insider also regularly updates this list of the best credit card welcome offers currently available — keep that page bookmarked if you want to see what limited-time bonuses are currently running.

Keep in mind that we're focusing on the rewards and perks that make these credit cards great options, not things like interest rates and late fees, which will far outweigh the value of any points or miles. It's important to practice financial discipline when using credit cards by paying your balances in full each month, making payments on time, and only spending what you can afford to pay back. 

The best credit card offers for 50,000 points or more: 1. Chase Sapphire Preferred: 60,000 points

One of the best bonuses right now will earn you 60,000 Chase Ultimate Rewards points. The Sapphire Preferred card, which charges a $95 annual fee, currently features a bonus of 60,000 points after spending $4,000 in the first three months. That's conservatively worth $750 toward free and discounted travel when you use those points to book through Chase's Ultimate Rewards travel portal.

The Sapphire Preferred card earns 2 points per dollar on dining and travel purchases, 5 points per dollar on Lyft purchases, and 1 point per dollar everywhere else. You can redeem points for 1.25 cents each on most major airlines and hotels through the Chase website. You can also transfer Ultimate Rewards points to a list of travel partners for potentially more value per point.

Click here to learn more about the Chase Sapphire Preferred card » 

2. Capital One Venture card: 50,000 miles

The Venture card from Capital One offers 50,000 bonus miles after you spend $3,000 on purchases in the first three months. The card charges a $95 annual fee, which is waived the first year. Capital One miles are worth 1 cent each when you use them to offset travel purchases, which makes the Venture card's bonus worth $500. However, transfer partners can make these points more valuable in some cases.

With this card, you earn 2 miles per dollar on every purchase with no limits. Capital One makes these among the easiest travel reward miles to redeem with its Purchase Eraser tool. Just make any travel purchase with the card like usual, then log into Capital One to reimburse yourself for the purchase with miles. It essentially wipes the purchase off of your statement so you never have to pay.

Click here to learn more about the Capital One Venture card »

3. Chase Sapphire Reserve: 50,000 points

The ultra-premium Chase Sapphire Reserve card now charges a $550 annual fee (recently increased from $450) and features a 50,000-point bonus after $4,000 in purchases in the first three months. The bonus isn't as good as the 60,000-point offer on lower-tier Sapphire Preferred, but points are worth 1.5 cents each when you redeem through Chase with the premium version instead of 1.25 cents. That makes the bonus worth at least $750 toward travel.

It includes airport lounge access, a $300 statement credit on travel purchases, and extensive travel benefits and protections. You'll earn 3 points per dollar on travel and dining purchases, and 10 points per dollar on Lyft rides. Newly announced benefits include complimentary memberships to Lyft and DoorDash that offer discounts and additional benefits with those services.

Click here to learn more about the Chase Sapphire Reserve »

4. American Express Platinum: 60,000 points

The Platinum Card from American Express offers 60,000 points after $5,000 in purchases in the first three months. It charges a $550 annual fee, which includes access to a wide array of airport lounges, elite status with Hilton and Marriott, and other premium travel benefits. Amex points are worth about 2 cents each, according to The Points Guy, which makes this bonus worth $1,200.

The Amex Platinum card earns 5 Membership Rewards points per dollar on flights booked directly with airlines or American Express Travel as well as 5x on prepaid hotels booked on It gives you 1 point per dollar everywhere else.

Click here to learn more about the Amex Platinum card »

5. United Explorer card: 65,000 miles (limited-time offer)

For a limited time, the United Explorer card is running an increased sign-up offer of up to 65,000 United bonus miles. You'll get 40,000 miles after spending $2,000 on purchases in the first three months and another 25,000 after spending a total of $10,000 on the card in the first six months. United recently moved away from its fixed award chart, but 60,000 miles is roughly enough for a round-trip award flight to Europe.

The card is great for regular travelers on United. It gives you 2 miles per dollar for purchases at United, restaurants, and hotels. You get 1 mile per dollar on all other purchases. Benefits include a first bag checked free, 2 United Club one-time passes per year, priority boarding, 25% back on in-flight purchases, and more. It charges a $95 annual fee, but it's waived the first year.

Click here to learn more about the United Explorer card » Don't let a bonus go to waste

If you don't typically spend enough to reach the bonus, consider making a few future purchases early to get over the hurdle. Stocking up on non-perishable groceries, household items, or even a gift card for a favorite airline or restaurant that you know you'll use in the future could get you over the line to earn your bonus.

Once it's in your account, it's up to you to decide how to put it to the best use. Whether you're jetting off for an adventure, kicking back at a relaxing hotel, or want to take the family on an extra trip to visit grandma and grandpa, miles and points make it all a lot more affordable. Just remember to pay your balance in full each month, because interest fees will more than cancel out the value of any rewards you earn.

See Business Insider's list of the best credit card offers for 100,000 points or more »

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The head of Merrill Lynch explained why the firm has zero interest in buying a robo-adviser — and it shows how buzzy wealth-tech startups are in a tricky spot (BAC)

Fri, 01/17/2020 - 2:08pm  |  Clusterstock

  • The head of Bank of America's wealth management business, among the largest in the US, said on Wednesday that his unit was not planning to acquire a robo-adviser. 
  • Investment-focused tech startups "mainly had their heyday in the mid 2010s and learned some hard lessons along the way," the Deloitte Center for Financial Services said in a report published Wednesday. "As a result, many have shifted to a business-to-business (B2B) model, merged with incumbents, or simply disappeared."
  • Andy Sieg, the president of Merrill Lynch Wealth Management, told Business Insider that the unit is focused on investing in Merrill's existing technology and trying to ensure that its thousands of financial advisers are incorporating the full menu of tech into their practices.  
  • That thinking highlights how standalone robo-advice and wealth-tech firms may be in a tricky spot as legacy firms invest in their own technology. Meanwhile, the pipeline of new startups in the space has ground nearly to a halt. 
  • The firm has also doubled the number of its "digital specialists," from 15 to 30, who are responsible for guiding advisers on how best to harness new technology. 
  • Visit BI Prime for more wealth management stories.

The head of Bank of America's massive wealth management business said on Wednesday that buying a robo-adviser was not in the cards for the unit.

Andy Sieg, the president of Merrill Lynch Wealth Management, said the unit is focused on investing in Merrill's existing technology, which includes its own self-directed investing tool, and trying to ensure that its thousands of financial advisers are incorporating the full menu of tech available to them into their practices. 

"The best road to the future for us is continuing to invest in our own platforms, and ensure that they're leading the marketplace in terms of capabilities," Sieg, who has led the business since 2017, told Business Insider. 

That thinking highlights how standalone robo-advice and wealth-tech firms may be in in a tricky spot as legacy firms invest in their own technology. Meanwhile, the pipeline of new start-ups has ground nearly to a halt. 

"They mainly had their heyday in the mid 2010s and learned some hard lessons along the way," the Deloitte Center for Financial Services said of the fintechs it broadly groups as "invest-techs" in a report published on Wednesday. "As a result, many have shifted to a business-to-business (B2B) model, merged with incumbents, or simply disappeared."

The San Francisco-based startup SigFig, for its part, has pivoted in recent years from a business-to-consumer to a B2B business model.

Meanwhile the number of invest-tech firms coming to the market has dwindled since a post-financial-crisis peak of 81 in 2014, according to Deloitte's report.

Just four launched in 2018, and only one debuted last year.

"As invest-techs mature, they are now tasked with striking the right balance between collaboration and competition to secure their place at the forefront of the industry," Deloitte's team wrote.

The global head of financial technology banking at RBC told Business Insider earlier this month that while some robo-advisers' growth has been quite impressive, "to make the business models work, it's predicated on AUM levels that are much higher than where they sit today."

At the same time, legacy wealth managers like Merrill Lynch and peers like Morgan Stanley have to grapple with attracting a new generation of wealth and brokerage customers accustomed to cheap, automated transactions with brands that only emerged in the wake of the global financial crisis. 

Some 72% of Merrill Lynch clients are actively using Merrill Lynch and Bank of America's online or mobile platforms, Sieg said on Wednesday after Merrill and parent Bank of America reported fourth-quarter earnings results.

Within that base, the number of clients using the MyMerrill app — separate from its self-directed offering — rose 44% in one year. Last year, the business launched new digital features for clients, including the ability to scan and upload documents into the MyMerrill app, as well as sign documents directly with the app and send them to advisers. 

The firm has also doubled the number of its "digital specialists," from 15 to 30, who are responsible for guiding advisers on how best to harness new technology. 

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Big banks have saved $32 billion from Trump's tax cuts, report says

Fri, 01/17/2020 - 1:55pm  |  Clusterstock

  • President Donald Trump hailed his signature tax overhaul as a "middle-class miracle."
  • While studies show many Americans did pay less to the government because of that law, big banks appear to have emerged as some of the biggest winners. 
  • The nation's six top banks saved $18 billion in 2019 as a result of the Tax Cuts and Jobs Act, according to an analysis by Bloomberg News.
  • Visit Business Insider's homepage here.

President Donald Trump hailed his signature tax overhaul as a "middle-class miracle." And while studies show many Americans did pay less to the government because of that law, top banks appear to have emerged as some of the biggest winners. 

The nation's six top banks saved $18 billion in 2019 as a result of the Tax Cuts and Jobs Act, according to an analysis by Bloomberg News. The banks — Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley and Wells Fargo — have saved $32 billion since the legislation took effect in 2018. 

The average effective tax rate for the top banks fell to 18% last year, compared with 20% a year earlier and 30% before the $1.5 trillion package was put in place. Bloomberg calculated what was paid under the new tax law and compared that with averages between 2013 and 2017. 

At a signing ceremony for a partial trade deal with China on Wednesday, Trump called on several bank executives directly as he touted his economic policies including tax cuts. 

He asked Mary Erdoes, the head of JPMorgan Chase's asset management unit, to thank him for "incredible"' earnings in the fourth quarter.

"They were very substantial," Trump said at the ceremony in the East Room of the White House, referring to the earnings. "Will you say, 'Thank you, Mr. President,' at least? Huh? I made a lot of bankers look very good."

Combined profits at the six banks have jumped in recent years, coming in at more than $120 billion in 2018. Advocates of TCJA said large tax breaks enjoyed by corporations would trickle down to the middle class through pickups in hiring, investment and wages. But the package delivered benefits even more generous than expected to the ultra wealthy

The Trump administration has since shifted its approach, emphasizing a focus on the middle class in a proposed second round of tax cuts. While any such legislation would be unlikely to get through Congress before the November election, it gives Trump a fresh message for his base. 

SEE ALSO: NAFTA rewrite gets final OK in Congress, giving Trump back-to-back trade deals to tout

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I met with a new financial planner, and I've already made 2 game-changing tweaks to the way I manage my money

Fri, 01/17/2020 - 1:47pm  |  Clusterstock

For my husband and me, financial well-being is a top priority after neglecting it for years. We've made our fair share of irresponsible spending choices, which resulted in credit card debt and a lack of savings. 

Thankfully, since adjusting our budget and increasing our income, we've been able to pay off our credit card debt and make a bigger dent in our student loans. But now that we've removed the elephant that's been in the room for half a decade, we weren't sure how to create habits that would ensure a healthier financial future for our family of four. 

Our main question was this: What's the next step, now that we're out of debt? To find the answer, we decided to meet with a new financial planner.

A friend connected us to a certified financial planner (CFP) based in Chicago. We had an initial consultation on the phone, and I appreciated the CFP's direct style and sense of humor. He's also a parent, so we felt he could offer helpful insight on how to approach budgeting and saving with kids (and understand how expensive they can be). 

We decided to move forward with a planning meeting, and we couldn't believe how much we learned in those 60 minutes. Most of the call was going over our personal financial goals, both short and long term, and coming up with habits and strategies that would allow us to meet these goals over time. 

My husband and I agreed that we wanted to budget more effectively, save more money for retirement and our kids' college, and set aside as much as we can for emergencies along with spending and travel. 

Based on our current financial situation, the CFP made two recommendations that we're already starting to put in place: budgeting differently and streamlining my cash flow as a freelancer. 

'Pay yourself first'

I'll be the first to admit that the way my husband and I have budgeted in the past hasn't worked. For a lot of months, we didn't budget at all — the process either felt overwhelming or we simply didn't make time to sit down and create a plan for our income. 

Other months, we budgeted in a way that showed us where our money was going, but didn't contribute to our overall wealth. In other words, we didn't prioritize saving. 

A CFP can help you find ways to save more. Use SmartAsset's free tool to connect with a qualified professional »

In our meeting, the CFP recommended that we try to shift our perspective on budgeting. Instead of allocating all of our income toward expenses, he encouraged us to "pay ourselves first" — to set aside a certain amount for savings before it even hits our checking account. 

Along with my husband's 401(k) contribution, we plan to start allocating a specific amount to general savings from his paycheck. Since I'm a freelancer, I'll be putting aside a sum for my own retirement. I plan to ask in our next financial meeting the most effective way to invest in retirement as a self-employed person.

Create a separate business checking account

At times, living as a freelance writer means living month to month. All of my clients pay me different amounts at different times, and my workload can also vary drastically in a given month. 

That said, I've always had clients pay me via direct deposit to our joint checking account, since we generally needed all the money I was making. There's nothing inherently wrong with using the money you make, but for us, having the money available makes us more likely to spend it. 

Since at this point we don't need all the money I'm making for our immediate budget, the CFP recommended that I create a separate checking account for my business, and pay myself bi-monthly into the joint account. The goal is to be able to budget based on my husband's paychecks and my pre-determined self-payments each month, and to save the rest for estimated quarterly taxes or an emergency fund. 

While it might take some time for us to notice a major difference in the state of our finances, it feels good to have a plan in place, and a financial advocate who can hold us accountable along the way. Once we have some savings built up, we're excited to learn more from our financial planner about how we can invest our money in other, potentially more fruitful ways. 

A financial planner can help you spend less and save more. Use SmartAsset's free tool to connect with a qualified professional »

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