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Asset Preservation Advisors




City:Atlanta

State: GA



BIOGRAPHY:
APA’s philosophy is to work closely with our clients to develop an in-depth understanding of their unique needs and objectives. We then customize a municipal bond portfolio that best meets their specific goals and needs. APA manages high quality municipal bond portfolios in four strategies: Short-Term, Intermediate-Term, High Income, and Taxable.

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Economic Security Declines for Americans

Economic security is out of reach for more than one in five Americans. What contributes to their insecurity?

| BY Adriana Reyneri

Economic security remains out of reach for the more than 20 percent of Americans who saw their household income decline by one-fourth or more in the recession and lack adequate reserves to make up for the loss, according to a report released today by Yale University and the Rockefeller Foundation and reported by CNN Money.

 The report updates the finding of the Economic Security Index launched last year by Yale political science professor Jacob Hacker and funded by the foundation. More than one in five Americans – about 62 million people - have lived in economic insecurity since the start of the recession.

 “Traditionally, talk of economic dislocation has focused on Americans at the bottom of the economic ladder. Yet the recent downturn has showcased another side, the risk confronted by most Americans, poor and middle class, of tumbling down the economic ladder without an adequate safety net,” Hacker explained in a recent article called “Understanding Economic Insecurity: The Downward Spiral of the Middle Class.”

 Prior to the recession less than 18 percent of families lived in economic uncertainty, according to the index, and 25 years ago 16 percent faced a financially precarious situation. According to Hacker, “The prevalence of insecurity has increased over the last generation, and this insecurity is associated with strong psychological responses and substantial economic hardship.”

 The index uses three criteria to measure economic insecurity, major income loss, out-of-pocket medical expenses and a lack of savings. Health care costs have been a major threat to economic security, according to the index, which found that medical expenses have increased by a median of 36 percent in the last 25 years.

 According to these criteria, the financial situation of some groups has become more precarious than others. Young adults ages 18 to 34 had the highest rate of economic insecurity at 25 percent. African-Americans and Hispanics also had a high rate of economic insecurity, nearly 25 percent, compared to less than 20 percent for whites. Economic security was also high – more than 25 percent – for households headed by an individual who never graduated from high school.

 The Economic Security Index is the “first integrated measure of the economic insecurity of American families,” according to a statement from Yale and the foundation. The index represents the share of Americans who experienced at least a 25 percent decline in inflation adjusted “available” household income.

 Economic shocks to a household can included a firing, layoff, illness or injury that causes loss of work, as well as higher health insurance premiums, loss of health insurance or major out-of-pocket health expenses. Declines in wealth due to losses in retirement funds or falling home values, or a change in marital status due to divorce or death can all make a household less financially secure.

 The index is part of the “Campaign for American Workers” initiative of the Rockefeller Foundation. The foundation states that the initiative “strives to improve economic security among American workers and their families, in part by improving knowledge and understanding among policymakers.”