Month: September 2026

New Trump Account Updates

Picture two couples, each with a baby born this year, each routing $2,500 of salary into that child’s Trump Account through an employer’s payroll system. One couple sits in the 35% bracket. The other, at roughly $65,000…

4 min read

Trump Account UpdatesPicture two couples, each with a baby born this year, each routing $2,500 of salary into that child’s Trump Account through an employer’s payroll system. One couple sits in the 35% bracket. The other, at roughly $65,000 of taxable income, is in the 12% bracket. Both contributions escape federal income tax. The first couple’s bill shrinks by $875. The second couple’s bill shrinks by $300. Same account, same dollars, nearly three times the benefit for the household that needed it less.

That arithmetic is the quiet story inside what has been presented as a workplace convenience.

Congress Built the Benefit – The IRS Just Wrote the Manual

The One Big Beautiful Bill Act already let employers put up to $2,500 a year into an employee’s or a dependent’s Trump Account without adding to the worker’s income, and it already allowed a company to run that contribution through a Section 125 cafeteria plan so the employee funds a child’s account out of pre-tax salary. Employers could begin on July 4, 2026. What Treasury and the IRS published on Aug. 11 is the operating manual: how to structure the program, how nondiscrimination testing works, and a safe harbor for companies that want to match the government’s $1,000.

The Break Stops at the Income Tax Line

It is easy to overstate what “pre-tax” buys here. The exclusion applies to federal income tax only. The money stays wages for Social Security, Medicare, and unemployment tax purposes. So, the savings amount to nothing more than the sum deferred multiplied by the filer’s top income tax rate, which is precisely why $2,500 is worth $875 to a 35% taxpayer and $300 to a 12% taxpayer.

Postponed for Decades, Not Years

Nor is the tax forgiven. Nothing can be withdrawn throughout the rule’s growth period, which runs until January 1 of the year the child turns 18. From that date, the account behaves like any other traditional IRA, meaning a 10% additional tax on distributions taken before age 59½ unless an exception applies, on top of ordinary income tax. The realistic horizon is four decades or more, not the college fund some families picture.

On the basics: Trump Accounts, Section 530A of the code, came out of last year’s OBBBA. A child who is a U.S. citizen born from 2025 through 2028 can receive a one-time $1,000 federal deposit, though it is not automatic. A parent has to open the account and elect the deposit on Form 4547, and the child needs a Social Security number. Contributions from all sources top out at $5,000 a year at current levels, indexed for inflation after 2027. The money must sit in a fund tracking a broad index of mostly U.S. stocks, with no leverage and fees capped at a tenth of a percent.

Taxation on the way out follows the money’s path in. Dollars contributed with after-tax income create basis and come back untaxed. Everything else, meaning the federal $1,000, employer contributions, pre-tax payroll elections and all investment earnings, is ordinary income when withdrawn.

Not Every Parent Will Get the Chance

Access tilts the same direction. Mercer surveyed close to 350 employers in April and found roughly 4% expecting to launch a contribution program in 2026 or 2027, with about two-thirds ruling it out. Adoption skews toward large firms with real benefits infrastructure, the same employers already offering generous 401(k) matches. A parent at a small company may never see the option. Anyone self-employed is excluded by rule: partners, sole proprietors, and more-than-2% S corporation shareholders cannot make the pre-tax election even if their own company sponsors a program for its common-law employees.

There is a planning burden, too. Households with finite savings already ration dollars across retirement accounts, 529 plans and emergency reserves. A pre-tax Trump Account election adds another comparison, and the families most likely to get it right are the ones who can afford advice.

Conclusion

The regulations are proposals. Written comments close Sept. 25, and a hearing is set for Oct. 15, so the final text could shift. Employers may rely on the proposed rules in the meantime. What is unlikely to shift is the underlying arithmetic. The $1,000 from Treasury lands identically in every eligible child’s account. The pre-tax payroll option does not, and its value climbs with the parent’s bracket.

Understanding Inflation Accounting

According to the July 12, 2026, Consumer Price Index Release from the U.S. Bureau of Labor Statistics, the 12-month inflation rate rose by 3.4 percent and the month-over-month measure rose by 0.1 percent in July 2026…

3 min read

Understanding Inflation AccountingAccording to the July 12, 2026, Consumer Price Index Release from the U.S. Bureau of Labor Statistics, the 12-month inflation rate rose by 3.4 percent, and the month-over-month measure rose by 0.1 percent in July 2026 compared to June 2026. With inflation higher than normal over the past few years compared to near-term historical averages, understanding how inflation is accounted for is essential for companies to interpret it properly. 

Defining Inflation & Accounting Needs

This reporting technique adjusts a business’ financial statements that accounts for inflation-related price changes. By adjusting for a price index, it updates financial statements to show a business’s true financial position and ensure consistency over time.

Whether it’s inflation or deflation, this type of accounting is used during periods of significant price fluctuations. It’s especially important for publicly traded, multinational corporations and how they report their finances since investors look at their performance on a quarter-over-quarter and year-over-year basis.

There are two primary methods: current purchasing power (CPP) and current cost accounting (CCA). CPP looks at monetary and nonmonetary items as separate spheres. Examples of monetary assets include cash, investments, accounts and notes receivable – essentially an asset that can be turned into a determinable monetary figure. Non-monetary assets can take the form of tangible assets like those in a business’ property, plant or equipment line item. Intellectual property and goodwill are other examples of non-monetary assets.

While nonmonetary items are indexed based upon a metric such as the Consumer Price Index (CPI), with the CPP method using historical costs as the baseline numbers, monetary items are evaluated to see what value the items may have gained or lost during the period analyzed. 

CCA analyzes asset values at their fair market value, not their historical cost or the price paid for assets when originally reported. The following example illustrates how the CPP model calculates it:

A company bought equipment in 2010 for $15,000 based upon a price index of 200, and in 2026 the established price index rose to 400. Based on taking the new price index of 400, divided by the previous price index of 200 (400/200 = 2), the original purchase price of $15,000 is to be multiplied by the conversion factor of 2 = $15,000 x 2 = $30,000.

When the company goes to account for it on their financial statements, it would be recorded on its balance sheet on the line item “closing equipment balance” for the $30,000.

Why Restating Financial Statements is Important

It’s important to ensure a business’ historical information is relevant, along with their financial statements providing internal and external audiences an accurate perspective of what inflation and deflation do. During periods of high inflation or deflation, if the data is not indexed accordingly, it’s inaccurate. The primary benefit is that business’ income and expenses are represented and comparable with other companies and historical information.  

While each business and its asset inventory is different, understanding how deflation and inflation impact businesses is an important consideration for daily operations and external audiences who may lend or invest in a company.

Bond Investment Strategies

Bonds are designed to deliver both capital preservation and income, and are generally considered lower risk than stock investing. The purchase price of a bond is basically a loan to an issuer, such as the federal government…

5 min read

Bond Investment StrategiesBonds are designed to deliver both capital preservation and income, and are generally considered lower risk than stock investing. The purchase price of a bond is basically a loan to an issuer, such as the federal government, a municipal government, or a corporation. The term of the loan is determined for a specific period of time – referred to as the maturity date.

During that time, the issuer uses bond money to fund projects, and in return pays the buyer interest over the term of the loan. Once the term ends, the bond issuer pays back the money it borrowed (i.e., the purchase price). The interest is paid on a predetermined schedule – quarterly, semiannually, or annually. The interest rate on a bond is called the coupon rate, and it is fixed at the time of issuance and remains the same until the bond matures.

For example, say you purchase a 10-year bond for $10,000 with a coupon rate of 4 percent, paid twice a year.. Over the 10 years you’ll collect $4,000 in interest, and at maturity you get your $10,000 back. That’s a 40 percent cumulative return on the original investment.

Bonds with a maturity date of less than four years are considered short-term; between four and 10 years are considered intermediate-term bonds; and terms of 10 or more years are considered long-term bonds. Bonds can be useful in many ways, such as to provide income, save for a particular expense, or to seek out high interest rates for a higher total return. The following are a few bond strategies to address each type of objective.

Objective: Generate Income

To generate income over a long period of time – when interest rates tend to fluctuate – one strategy is to ladder bond holdings. This means purchasing a portfolio of individual bonds with varying maturity dates. For example, you may spread out your bond terms from one to 30 years – with each interval acting as a rung on this metaphorical ladder. Note that each type of bond is rated for the credit quality of the issuer, which reflects its likelihood of default. The lower the credit rating, the higher the interest paid to compensate for the issuer’s extra risk.

As each bond matures, you can reinvest money into another bond based on the current prices and coupon rates on offer at that time. This way you may continue to shop for higher coupon rates every few years without locking up all of your money for a 10-, 20-, or 30-year duration. When rates are on the rise, you can secure a higher yield as your bonds mature. If rates are falling, reinvest that money in a short-term bond as a holding pattern until coupon rates increase again. This way, you continue to benefit from owning longer-term bonds purchased when rates were higher. Barring any defaults, the ladder continues to grow and offer steady growth for bond assets.

Objective: Save for a Particular Expense

The Bullet strategy is a simple way to generate the money you need for a specific financial goal within a specific time frame – such as buying a house in five years, or saving for college or a retirement nest egg in 10 or 20 years. You basically purchase bonds with a similar maturity date. Between the purchase price and the generated income, you’ll know exactly how much you will receive when those bonds mature. It’s like shooting a bullet straight toward your financial goal.

Objective: Seek Higher Interest

The Barbell strategy splits your money between the two ends of the maturity range and skips the middle. You hold short-term bonds on one end and long-term bonds on the other, with little or nothing in between, much like the weights sitting at either end of a barbell.

The long end captures the higher coupon rates that generally come with committing money for a longer period. The short end keeps a portion of your money coming due on a regular basis, so each time one of those bonds matures, you can re-evaluate rates and decide where that money goes next. If rates have moved higher, shift it to the long end and lock in the better coupon. If rates remain tepid, buy another short-term bond and wait. The result is a portfolio that captures much of the yield available at the long end without committing everything to a rate you may later regret.

There are many different types of bonds, including federal government, municipal government, and corporate bonds. While government bonds are generally considered safe, each bond is issued a credit rating based on the issuer’s financial health, creditworthiness, and past history of repaying debt obligations. Investors also have the option to invest in bond funds, which offer a large selection of bonds and do not require investments to be held to maturity. However, bond fund interest rates fluctuate daily, and there is no guarantee the investor will receive the original principal amount when they cash out of the fund.

How to Keep Your Cash When You Make Good Money

You’re doing well, earning a good salary. But somewhere around the latter part of the month, after you’ve paid your obligations and basically lived your life, which isn’t extravagant, you…

4 min read

How to Keep Your Cash When You Make Good MoneyYou’re doing well, earning a good salary. But somewhere around the latter part of the month, after you’ve paid your obligations and basically lived your life, which isn’t extravagant, you look at your checking and savings accounts, and well, there isn’t much there. And that sinking feeling starts to kick in. Sound familiar?

This is called lifestyle inflation. In a nutshell, the way you spend increases over time in relation to your rising income, so your financial floor rises right along with it. In fact, according to a Federal Reserve Survey of Consumer Finances, households that earn between $100,000 and $200,000 are in sizeable credit card debt, have retirement accounts that need help, and very little savings in relation to their income. What to do? Here are a few ways to get a handle on this.

Get a real number. You might have all your expenses in QuickBooks or the like and, on paper, you look good. But to get a real picture of how you’re doing, calculate the expected net worth you should have for someone at your age with your salary: Multiply your age by your salary, then divide it by ten. If your net worth is below half that number, something’s not adding up. Pun intended. The next critical step: Subtract your liabilities from your assets. This might not feel good, but from this you’ll instantly see what you can affect and change.

Pinpoint the source of your lifestyle inflation. It might not be huge expenses, but little pricey purchases over time that are causing you to feel financially squeezed. Go to your spreadsheet and take a look at the last three years and compare. See where you’ve spent more, calculate the difference, and there’s your answer. Areas to consider are housing, dining, subscriptions and services, travel, gifts, clothing, etc. Don’t make drastic changes all at once, as you might rebound and splurge. Just try to reduce your spending in the areas with the biggest deltas. Give yourself 60 days. Easy does it for lasting change­. This might be a smart mantra.

Set up intentional constraints in certain areas. As mentioned above, you don’t need to become a fiscal conservative. Just look at the areas where things feel a bit…much. Here are three principles to work with:

  • Decide on savings and investment allocations for payday. There are non-negotiables you can put on auto-draft. If you don’t see it, you won’t miss it.
  • Determine a set number for each category. But approach these numbers as conscious decisions, not as a way to restrict yourself. You’re choosing not to spend $500 on dinner each week because in relation to the rest of your goals, this makes sense.
  • Set up a discretionary account. You know, fun money. This is a fixed monthly transfer amount without overdraft protection. When the money’s gone, it’s gone. This isn’t a way to frustrate or shame yourself; you just have a real window into what you’re spending, rather than some vague notion. This creates real clarity.

Reimagine your social spending. We’re talking dinners out with friends, group trips, or even the things that just feel normal, like wedding and birthday gifts. This might be the hardest part of all. So here’s a tip: Don’t let these things sneak up on you. Plan for these events in advance and give yourself a price range to stay within. This way, you stay on track and don’t miss out on important moments.

The truth is that your income might well continue to increase. You’ll get that raise and bonus. So instead of living it up and spending with wild abandon, try this: for every raise or bonus, put at least 50 percent of the net increase toward savings or investments before changing anything about your lifestyle, i.e., buying that new car, etc. The other 50 percent? Make intentional choices about how you want to spend. Conscious decisions pay off in the long run. And best of all, you won’t continue to feel broke.

Insurance for AI Risk: Is It Time to Consider AI Liability Coverage?

Over the past few years, artificial intelligence (AI) has evolved from a futuristic concept into a core engine of modern enterprise strategy. Organizations across every major industry are now using AI to automate complex workflows…

4 min read

Insurance for AI RiskOver the past few years, artificial intelligence (AI) has evolved from a futuristic concept into a core engine of modern enterprise strategy. Organizations across every major industry are now using AI to automate complex workflows, augment customer service operations, drive predictive decision-making, and unlock greater operational productivity.

Understanding AI Risk

AI is not an easily defined category, as it spans several dimensions that traditional risk frames are not built to accommodate. The Gallagher report, Smart Systems, Blind Spots: Rethinking Insurance for the AI Era, found that the pace of AI adoption surpassed the insurance industry’s capacity to develop responsive products.

What makes AI unique is that risks associated with it emerge from the way systems learn, generate outputs, and make decisions to influence customers, employees, and business outcomes.

Modern businesses face several distinct risk vectors:

  • Biased or discriminatory decisions
    Automated recruitment, lending, or credit-scoring models trained on flawed data can produce systematically unfair outcomes. This can result in regulatory penalties, civil rights litigation, and damaged brand reputation.
  • Hallucinations and inaccurate outputs
    AI models can confidently generate inaccurate or misleading information. A customer-facing AI assistant that provides incorrect financial, legal or medical guidance could create significant liability exposure.
  • Intellectual property and copyright disputes
    Models trained on vast, unvetted datasets reproduce copyrighted material, exposing organizations to costly intellectual property infringement claims.
  • Data privacy violations
    Unintentional exposure of proprietary trade secrets or personally identifiable information (PII) during model training can trigger regulatory investigations under frameworks such as the EU AI Act, the General Data Protection Regulation (GDPR), or state-level privacy laws.
  • Cybersecurity vulnerabilities
    AI introduces new attack vectors, including prompt injection, data poisoning, and model extraction. Malicious actors can exploit these to compromise business integrity.
  • Financial losses
    Autonomous trading agents or algorithmic pricing models operating at high speeds can execute erroneous transactions, leading to immediate financial losses.

Why Traditional Insurance May Not Be Enough

Existing coverage was not designed for current AI issues. Cyber policies were designed around data breaches and network intrusion. This does not cover an AI model making a biased hiring decision or fabricating a financial projection.

Professional indemnity and E&O policies assume a human professional exercised judgment. So, when an algorithm makes a mistake, an insurer may dispute whether the policy was intended to respond. For general liability policies, the focus is on bodily injury and property damage. If an AI program causes bodily injury, insurers can debate whether the policy applies.

Several incidents have caused some insurance companies to exclude AI from their corporate policies. For instance, Google was sued by a Minnesota-based company after its AI Overviews feature named it as a defendant in a lawsuit. This is just one case that highlights the growing concern around “silent insurance” when policies do not explicitly address AI-related risks. However, businesses may assume they are covered when they are not.

The challenge is compounded by the rapidly evolving legal landscape, with governments worldwide introducing new regulations.

The Rise of AI Liability Coverage

In response, a new category is beginning to take shape. This is AI liability insurance. These policies are designed to explicitly address the development, deployment, and use of AI systems. While offerings may vary across providers, AI liability covers incidents such as AI-driven discrimination claims, IP infringement from generative outputs, financial losses from automated decision-making, and regulatory penalties tied to AI non-compliance.

Insurers are approaching underwriting as they did with early cyber policies. They are starting cautiously, requiring detailed disclosure of how AI is used, existing governance controls, and how models are tested and monitored.

Beyond Insurance: Building Comprehensive AI Resilience

Insurance alone cannot eliminate AI risk and should not be a substitute for operational resilience. Organizations building genuine AI resilience are investing in:

  • Formal AI governance frameworks
  • Meaningful oversight of consequential decisions
  • Ongoing model monitoring and auditing
  • Employee training on responsible AI use
  • Clearly articulated responsible AI principles
  • Tested incident response plans specifically for AI-related failures.

A well-governed AI program will also make a business significantly more insurable, as underwriters increasingly price risk based on demonstrated controls.

Conclusion

AI has become one of the greatest sources of competitive advantage as well as a new source of liability. As regulatory scrutiny increases and AI-driven decisions become more consequential, executives must broaden their understanding of enterprise risk. Insurance should not be viewed as a substitute for governance, oversight or responsible AI practices.

For businesses increasingly relying on AI, the question is no longer whether AI creates liability risk, but whether existing insurance is equipped to respond to it. 

Focused on Ending Insider Trading, the Penny, Epilepsy, the War in Iran, and Projects that Waste Taxpayer Money

strong>21st Century ROAD to Housing Act (HR 6644) – This bipartisan, White House-endorsed bill addresses housing affordability by placing ownership restrictions on…

4 min read

Focused on Ending Insider Trading, the Penny, Epilepsy, the War in Iran, and Projects that Waste Taxpayer Money21st Century ROAD to Housing Act (HR 6644) – This bipartisan, White House-endorsed bill addresses housing affordability by placing ownership restrictions on large institutional investors and expanding financing for homebuyers. Introduced by Rep. French Hill (R-AR) on Dec. 11, 2025, it passed in the House on Feb. 9 and in the Senate with changes on March 12. The bill went back and forth between the two chambers until both agreed to the final form on June 23. However, during that time frame, the President withheld his support, and the bill was enacted on July 11 by the 10-day rule (meaning it was neither signed nor vetoed by the President within 10 days of receiving the bill from Congress).

Stop Insider Trading Act (HR 7008) – Known as SITA, this bill would expand the penalties for members of Congress who engage in insider trading, beyond those originally imposed by the STOCK Act of 2012. Under SITA, the penalty would increase from $200 to $2000 or 10 percent of the value of the transaction, whichever is greater, plus any profits. Note that despite violations, the STOCK Act penalties have never been successfully enforced. SITA would also ban legislators, their spouses, and dependents from purchasing individual stocks. It would not require them to discard stocks they currently own; however, in order to sell, they must issue a public notice at least seven days in advance. The bill is not likely to pass in the Senate because it contains provisions related to voting restrictions from the controversial SAVE Act. The bill was introduced by Rep. Bryan Steil (R-WI) on Jan. 12, passed in the House on July 22, and awaits consideration in the Senate, which is currently in recess until Sept. 14.

Common Cents Act (S 1525) – This act was introduced by Rep. Cynthia Lummis (R-WY) on April 30, 2025. The bill instructs the Secretary of the Treasury to stop minting the penny and issue a rule that requires cash transactions to be rounded up or down to the nearest 5 cents. This bill passed in the Senate on Aug. 7 and is now in the House for consideration.

National Plan for Epilepsy Act (S 494) – This bipartisan bill was introduced by Sen. Eric Schmitt (R-MO) on Feb. 10, 2025. Its objective is to require the Department of Health and Human Services (HHS) to develop and implement a national plan to prevent, diagnose, treat, and cure epilepsy. Mandatory activities include coordinating research and services across all federal agencies, soliciting public comments, and establishing an advisory council to report to HHS and Congress every two years with an evaluation of federally funded efforts and recommended actions regarding the nation’s progress on epilepsy. The bill passed in the Senate on Aug. 4 and is now under consideration in the House.

Directing the President, pursuant to section 5(c) of the War Powers Resolution, to remove United States Armed Forces from hostilities with Iran (HConRes 89) – This concurrent resolution would direct the President to remove U.S. troops from engaging in hostilities with Iran sans a declaration of war or Congressional authorization to use military force. Note that the resolution does not prevent the US from defending itself, its military, diplomatic installations, or allies from an imminent attack. The legislation was introduced by Rep. Pramila Jayapal (D-WA) on April 23. It passed in the House on July 23 and currently resides in the Senate.

Billion Dollar Boondoggle Act (HR 1722) – This bipartisan act would require an annual report issued to Congress by the Office of Management and Budget (OMB) that details taxpayer-funded projects that are over budget and behind schedule. The bill was introduced on Feb. 27, 2025, by Rep. Mariannette Miller-Meeks (R-IA). It passed in the House on July 22, 2026, and awaits consideration in the Senate.

Understanding Accumulated Other Comprehensive Income

According to the Flossbach von Storch Research Institute, 328 of the S&P 500 companies in 2024 had a negative Other Comprehensive Income (OCI) of $4.5 billion…

3 min read

Understanding Accumulated Other Comprehensive IncomeAccording to the Flossbach von Storch Research Institute, 328 of the S&P 500 companies in 2024 had a negative Other Comprehensive Income (OCI) of $4.5 billion. This is attributed to rising interest rates since 2022 had OCI figures of negative $325 billion. Understanding OCI and Accumulated Other Comprehensive Income (AOCI) is essential to see what this means and how it’s calculated.

AOCI is where unrealized gains or losses are listed as a special line item found under the Shareholder’s Equity section of a company’s balance sheet. As part of OCI, all unrealized transactions are excluded from net income on an income statement. OCI is the difference between net income and comprehensive income.

Illustrating How Financial Statements Work

If a business has multiple quarters of OCI, say $500,000 in Q1, $750,000 in Q2, and $1.25 million in Q3, the company’s balance sheet would have $2.5 million on its balance sheet under the AOCI line item in the Shareholder’s Equity section at the end of Q3.  

Investments that are classified as available for sale, not intended to be held until maturity, and are not a loan or a receivable may be recognized as OCI. One example is a bond portfolio that’s not held to maturity that’s seen an unrealized decrease or increase, and the available-for-sale asset can be included. Pension plans, for example, that see an increase in value, the difference, after recipient distributions are deducted, can similarly be recognized as OCI. Derivatives, classified as cash flow hedges, that experience unrealized gains and losses, also may qualify for OCI classification.

Important Considerations

If a transaction is completed and a gain or loss is realized, the reporting is moved from AOCI to the balance sheet’s Net Income section.

While it’s optional for privately held companies and nonprofits that don’t share it with external parties, the Financial Accounting Standards Board (FASB) generated a novel standard in 1997 mandating comprehensive accounting for all publicly traded companies in the United States. This is for all income, including other or special types of income, especially for losses/profits not yet realized.

Reporting AOCI accounts on the balance sheet is important because gains and losses impact the balance sheet overall and the business’ income statistics. It’s also important to note that net income and retained earnings on the income statement are not finalized until transactions are completed and moved to a different section of the balance sheet.

According to FASB’s Statement of Financial Accounting Standards No. 220, titled “Income Statement — Reporting Comprehensive Income,” the reporting business must document comprehensive income in one or a series of two continuous statements with both other comprehensive income and net income.

Conclusion

Understanding OCI and AOCI work is essential for business owners and external audiences, such as potential investors, when examining a business’ operations.