DURHAM, N.C., Jan. 26, 2016 /PRNewswire/ -- The most recent Wall Street Journal survey shows leading economists predict a 17% chance the U.S. will enter another recession in 2016, with 80 percent of respondents predicting negative consequences for the economy.
A major cause for concern going forward is the FED's monetary policy. The nation's central bank is dancing around the issue of a series of rate hikes, which could threaten the U.S. economy.
According to David C. Lewis, RFC, owner of the startup financial services company Monegenix® (www.monegenix.com), "Business owners are in for a rude awakening if the FED decides to continue these rate hikes. All that cheap credit will suddenly be uncheap. You're just not going to be able to continue borrowing money at the rates they are now."
A bad economy also means sluggish retirement savings. For years, consumers and businesses have been told that saving money for their future is as easy as socking money away in a 401(k) or some other tax qualified retirement account. But, Lewis sees it differently.
"When you look at the numbers, the advice we're being told just doesn't jive with reality. We're seeing average retirement savings for business owners of $137,447. That might sound like a lot, but it's only $768 a month. Nobody can live on that. And, if the economy starts to slide, who is going to have the extra money to keep pumping up their retirement account?"
That combination of slowed business growth and depressed revenues could create a longer-term problem, says David.
"Let's say you chock up the low savings balances to poor savings habits. OK. I can understand that. But, when you drop from 2012.66 to 1906.90 in the S&P500 in January, that savings takes a serious hit. And, if January is as good as it gets for 2016, that's not a huge motivator for business owners to save money. Where will future growth come from?"
If the economy doesn't turn around, some experts believe we could see a repeat of 2008. If that happens, it could mean another lost decade.
Founded in 2014, Monegenix® is a privately owned financial services company that designs custom insurance-based financial plans, educational material, and financial tools for small business owners.
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