News about personal finance

According to U.S. Bank's 2026 Wealth Survey, Gen Z starts building wealth at 19 on average, 13 years before baby boomers. Still, 56% of Gen Z respondents say they did everything 'right' but have not reached their financial goals, and 29% have given up on buying a home for financial reasons. The article attributes this to rising costs: the median existing home sold for 4.7 times median household income in 2025, and in-state public college tuition in 2025-26 is roughly double its 1995-96 level after inflation. It also argues that traditional 401(k) matches leave out young workers who cannot afford to contribute.

One-year fixed savings rates have reached 4.41%, the highest since September 2024, and the average fixed rate across all terms is 4.49%. Personal finance experts say savers could earn about £215 more a year on £10,000 by choosing a 5.15% account instead of one paying 3%. Caitlyn Eastell of Moneyfacts notes that non-ISA fixed rates have risen for over six months, and top rates across all terms are above 5% for the first time since December 2023. Fixed bonds lock money away for the full term, so savers risk missing out if rates rise further. Meanwhile, £4.4 billion flowed into ISAs in August, ahead of the cash ISA changes in April.

The article calculates how much capital a 63-year-old would need in an IRA rollover to generate $70,200 a year, a hypothetical $5,850 a month, without buying an annuity. Required amounts vary by yield, from $585,000 at 12% to $2,265,000 at 3.1%. Examples include about $1,293,000 for 30-year Treasuries at roughly 5.4%, $2,265,000 for SCHD at about 3.1%, about $975,000 for JEPI at 7.2%, and about $605,000 for QYLD at 11.6%, though the article warns that covered-call funds can shrink principal. Subtracting average Social Security income of $2,170 a month cuts the needed portfolio to as little as $368,000 at a 12% yield.

Roth conversions move pretax or nondeductible IRA money into a Roth IRA, which can potentially reduce lifetime taxes but can also raise income in the conversion year, so the strategy isn't right for everyone. As of March 31, Roth conversions were up 41% from the same period in 2025, according to Fidelity data covering 19.6 million IRA accounts. Advisors warn that extra income can phase out tax benefits such as education credits, the SALT deduction worth up to $40,400 for 2026, and the $6,000 senior deduction, and can also raise Medicare premiums. For ACA marketplace enrollees, income above 400% of the federal poverty line, about $63,000 for a single person or $129,000 for a family of four in 2026, can cost them the premium tax credit, so they should proceed with caution.

Covered call ETFs, which hold stocks and sell call options to generate regular income, have attracted investors seeking monthly cash flow, but they can create tax surprises. Their distributions may include ordinary dividends, capital gains and return of capital, and return of capital reduces cost basis, so tax is deferred until shares are sold, often leaving a higher capital gains tax bill later. Advisers quoted in the article warn that after-tax returns may fall short of expectations and that investors often discover the tax impact only at tax time, so holding these funds in tax-deferred accounts such as a traditional IRA is suggested. The article also points to the Morningstar Tax Cost Ratio, which measures how much taxes on distributions reduce a fund's annualized return.