Home Sweet Home

Americans will spend some of their Social Security tax cut and are more upbeat about their local economies, according to 1,007 Americans polled in the RBC Consumer Outlook Index released on Jan. 6. Forty-two percent said they plan to spend all or most of the one-year Social Security payroll tax cut that became effective on Jan. 1, 2011. Just 26% said they plan to save all of the money. Some 47% of respondents said their local economy is weak, down from 51% in December and 59% in September 2010. But they had a gloomier picture of the country as a whole, with 64% saying the country is on "the wrong track," up from 61% in December. It was the ninth consecutive month that 60% or more of the respondents were negative about the country's direction.

Dismantling Dodd-Frank?

Several aspects of the Dodd-Frank Wall Street Reform and Consumer Protection Act have yet to be fully codified and implemented, but conservative House members are already trying to repeal it. Rep. Michele Bachmann (R-Minn.) on Jan. 6 introduced a repeal bill saying that Dodd-Frank overreaches federal powers. The Act calls for a self-funding mechanism for the SEC, allowing the agency to collect fees from the industry and use those funds to improve inspection and examination of financial advisors. Newly elected Republican House members are seeking to reduce funding for the SEC, among other things.

Health Savings Surpluses

At the end of 2010, there was $7.7 billion in health savings accounts (HSAs) and health reimbursement accounts (HRAs), spread over 5.2 million accounts, according to January data from the Employee Benefit Research Institute (EBRI). A close look at the numbers, however, reveals a more complex picture. First, at the end of 2010, average balances were $1,355, down 4.5% from the end of 2009. EBRI also found that changes in account balances varied across the household income spectrum. Balances increased for those with less than $50,000 in household income, fell for those with $50,000âˆ'$99,999 and were unchanged for those with $100,000 or more. Interestingly, account balances increased with education levels up to the college degree level, but only individuals with graduate degrees saw a decline in average account balances in 2010.