Social Security is possibly the most important social program in the United States. Each year, 21.7 million Americans are raised from poverty entirely because of their Social Security checks each month, according to the Center of Policy Priorities and budget.

It is also a program the vast majority of Americans will depend on, to some degree, during retirement. National pollster Gallup found that 85 percent of people that have not retired yet and were surveyed in April 2021 plan to depend on Social Security as a minor or major source of income to live on in their retirement years.

Yet, with as successful as Social Security has been for decades, it does have some serious financial concerns.

Social Security hasn’t done this in four decades

Just as investors can review a publicly traded company’s balance sheet and income statement to find out the total revenue a company is making and what that money is being spent on, Social Security’s “balance sheet” is published yearly.

Each year, the Social Security Board of Trustees releases a long report that examines every part of the program. This includes complete data on the total revenue Social Security made from its 3 income sources — the taxation of benefits, the taxation of payroll tax, and interest income — and how much of that money was channeled into administrative costs and payments.

Since Congress passed the Social Security Amendments of 1983 and it was signed into law by then- Pres. Ronald Reagan, the program has had an increase in their cash reserves. This is to say that Social Security has continually brought in more revenue each year than it has paid out. Social Security’s asset reserves increased from around $25 billion to $2.91 trillion between 1982 and 2020.

But this trend has changed. Even though the 2022 Board of Trustees balance sheet will not be published for at least several more months, the Social Security Administration will update each month on its investment holdings. It is required by law for the program’s asset reserves to be put in special-issue bonds, like United States Treasury bonds. Between the end of Dec. 2020 and the end of Dec. 2021, the total investments held by Social Security dropped over $31 billion. That is the 1st cash outflow for Social Security since 1982.

Even worse, these outflows are only slated to worsen. According to the intermediate-cost model (i.e., what the Board of Trustees thinks is most likely to happen), Social Security’s cash outflow might decrease the program’s asset reserves to only $1.34 trillion by 2030.

Every worker should be making it a priority to save for retirement to ensure that they have a secure future ahead of them. Making an investment for when your older and unlikely to be able to work is important because you cannot live on SS alone. You will likely need to depend on your savings to make up what the difference is between the income you will need and the amount of your retirement benefits.

Unfortunately, some recent research has discovered that most people are falling far behind when it comes to investing the amount they will need for their investments to provide enough income for them long after their paychecks stop coming in.

Workers are not doing nearly enough to save money for old age

An estimated 33% of employees are saving under 5% of their income for retirement.

Now, while it is good news that a lot of people are saving at least a little money, the not so good news is that investing under 5% of earnings is well below what you will likely need to provide for yourself as a senior citizen. In fact, while the usual rule of thumb has been investing at minimum 10% of your income for your future retirement, even this probably is not enough given the lower future returns that are expected, increasing healthcare costs and longer lifespans.

Instead, most future retirees will probably need to start investing about 15% to 20% of their earnings, which includes any employer match, if they desire a comfortable standard of living when they are in their later years.

How can you save even more for retirement?

While it is easy to say that workers need to save over 5% of their income, it is harder to do that in reality. In fact, if it were so easy to invest enough, it is likely many people would be doing that already.

There are a few techniques most people could implement that could help increase their savings rate. To raise the amount of your income that you are putting aside:

• Save your raises. When you get an increase to your salary, it should be put into investments before you can get used to having the extra money — especially if you are currently saving under 5% of your income. You are not yet reliant on that extra money so you could keep living on what your current budget is and add put your extra earnings into your retirement plan.
• Inch up your contributions to your retirement account. If you are able to increase your retirement account contributions slowly over time, you could gradually start putting in the necessary lifestyle changes that will enable you to invest 15% of your income. For instance, try increasing your contribution by about 1% and see if you could still live without any debt. You probably will not notice any difference. Once you start getting used to that, then raise it by another 1%.
• Make a big change. A lot of small budget cuts could be difficult to sustain, but one huge lifestyle change could be easier. For example, if you were to downsize to a smaller home or cheaper car, you could divert additional money to your retirement savings and you should hopefully acclimate fast to your new circumstances without having to constantly deprive yourself of the small pleasures.

If these approaches do not work for you but you are among the 1/3 of Americans that contribute less than 5% of your total income to retirement, it is important to search for a solution that will let you invest more. You will need savings later on in life, and the sooner you invest enough of your income into retirement, the easier it will be for you to build up that nest egg.

The top semiconductor companies Advanced Micro Devices and Nvidia are already being heavily used by metaverse creators for their hardware needs. Here is why that business space could be huge in the future.

1. The case for Nvidia

Nvidia creates state-of-the-art graphics cards for a wide range of purposes, such as gaming, robotics, data centers, as well as the company’s professional-visualization space, which is home to Nvidia’s Omniverse project. Nvidia’s Omniverse project is its virtual-world simulation and real-time 3D collaboration platform, available to the creators using the RTX graphics chips.

It can be used to create games or any other application involving virtual environments, including the metaverse, and over 100,000 developers are leveraging the graphic cards capabilities. From a financial perspective, the company’s professional-visualization section has made up just 7.8% of its $26.9 billion in total revenue in fiscal year 2022, but it was the quickest growing by far with an increase of 100% in revenue.

Beyond the Omniverse project, the company is already making graphics chips that can be compatible with most top virtual-reality headsets, which includes the Oculus brand, and is owned by the social-media giant Meta Platforms — the main creator of the metaverse.

Nvidia has a record year in 2022 from both a profitability and revenue standpoint. Its $26.9 billion in revenue has represented 61% growth when compared to fiscal year 2021, and its $4.44 in adjusted earnings each share increased 78%. This growth run is set to continue into fiscal year 2023 with analysts expecting $34 billion in revenue and around $5.55 in expected earnings.

As an investment, this Nvidia stock is a great way to add parts of the metaverse to your portfolio because it comes with many well-established, high-growth segments attached.

2. The case for Advanced Micro Devices

AMD is one of the most popular producers of semiconductors around the world and has a portfolio of huge deals. Its chips power many popular gaming consoles such as Microsoft’s Xbox and Sony’s PlayStation. Top EV maker Tesla has also selected AMD chips to run its infotainment systems in several of its cars.

2021 was a huge year for AMD. The company’s gross profit margin skyrocketed to 48% from 45% during 2020, and that has helped adjusted earnings for each share see growth of 116% to $2.79. And that has come on the back of a 68% boost in revenue up to $16.4 billion. AMD attributed its performance to increased sales of its products that have a higher-margin, but the pandemic-driven chip shortage issues have also given most semiconductor manufacturers the ability to raise prices throughout the year.

Analysts expect another show of strength this year with up to $25.5 billion in expected revenue and $3.99 in earnings potential. Given AMD’s growth rates, it is easy to say that AMD deserves a large premium, so the stock seems attractive even at its current price.

As Ethereum has seen an increased transaction volume, network traffic speeds have slowed down. And because of each transaction that is competing for a limited amount of mining power, transaction fees have soared. Of course, there is an upgrade underway that will attempt to address that issue, but scalability is not expected to start improving until 2023. In the meantime, there are other blockchains that have already fixed that problem, and they are starting to gain ground on Ethereum.

Here is one crypto that might eventually be bigger than Ethereum.

Scalability keeps its costs low

Avalanche is a programmable blockchain that is designed by Ava Labs. Its main innovation is the snowman consensus protocol, which is a type of POS in which validators can confirm transactions by sampling a small random subset of nodes instead of engaging in a time-consuming exchange of messages with every other node that’s on the network.

That gives Avalanche very fast speeds. In fact, with a throughput of about 4,500 transactions each second and a finalization time of just two seconds, Ava Labs thinks Avalanche now is the fastest blockchain in the world. For context, ETH handles about 14 transactions per second, and it needs up to six minutes to finalize its transactions. That lack of scalability has made its platform expensive; the avg. transaction fee is over $20 on ETH, but you will likely have to pay just a few cents on the Avalanche network.

Compatibility grows use cases

Avalanche is created to be compatible with ETH smart contracts, meaning creators could easily port their dApps from one blockchain to the other. Lending protocol Aave and Stablecoin exchange Curve are two of the more popular DeFi platforms on ETH, and both were launched on Avalanche in Oct, offering its investors a cheaper and faster means of access.

Shortly after, ETH-native USD Coin — a stablecoin that’s pegged to the United States dollar — was added to Avalanche in Dec. As the cryptoeconomy’s number two most-popular stablecoin, USDC might give the Avalanche DeFi ecosystem a large boost, because it lets people invest in DeFi without have to hold volatile crypto. For example, you could earn a 1.56% yearly percentage yield by lending USDC to the Aave protocol today. That is orders of magnitude over the 0.06% paid by the avg. bank savings account.

Utility might supercharge adoption

In short, Avalanche is very cheap, fast and compatible with ETH. Over the last year, that value proposition has given rise to rapid adoption. Avalanche’s transaction volume crossed 1 million per day for the first time in Jan. 2022. That is up from just a few hundred transactions each day in Jan. 2021, and it is almost equal to the 1.2 million avg. daily transactions that is seen on ETH so far this year.

Moreover, Avalanche currently has 175 blockchain projects — including many video games, DeFi protocols and NFT marketplaces– and it comes in ranked as the fourth-biggest DeFi ecosystem, with around $11 billion being invested on the blockchain. Moving forward, as those DeFi and dApps products draw in more consumers, developers and investors to its platform, demand for the AVAX token should increase, driving its value even higher. And with time, I think Avalanche might surpass ETH in terms of value and popularity.

Getting wealthy in the stock market could be as easy as owning a few pieces of the most powerful companies around the world and letting them compound for years on end. But you cannot pick just any stock in the market; most will not cut it over long periods.

Sometimes if it is broken, do not fix it. Some businesses have been compounding for years and are still going strong in today’s market. If you are wanting to put your hard-earned money into stocks and still sleep well at night while owning them, listen up. Here are three winners that you may want to consider.

1. Berkshire Hathaway

Investing in holding firm Berkshire Hathaway means trusting your dollars with the investing legends like Warren Buffett and Charlie Munger, who still manage the company to this day. Berkshire has built a large portfolio of private companies, including Duracell, Fruit of the Loom, Geico and has stakes in public companies such as Apple, American Express and Coca-Cola.

Berkshire has for years steadily seen growth its book of value (which is the total value of the firm’s assets minus its debt obligations) and the value of its shares has followed. with time, the stock has produced immense riches for investors, returning over 20% returns each year from 1964 all the way to 2018. With over $144 billion in short-term investments and cash on the firm’s balance sheet, Warren Buffett is ready for the company’s next Apple-like opportunity.

2. Sherwin-Williams

Paint and coatings maker Sherwin-Williams sells over one-in-four cans of paint throughout North America. Its products are sold under various brand names in many retail stores and in its name-brand stores. Whether you are a homeowner remodeling or just slapping a yearly coat of stain on your deck, or a contractor with some commercial projects, you are purchasing Sherwin-Williams’ products over and over again.

Sherwin-Williams makes almost $0.17 of free cash flow on each dollar in revenue and sends most of it back to its shareholders through dividends. Also, the business is a Dividend Aristocrat with about 43 consecutive yearly payout increases, and the stock has returned over 85,000% during its lifetime. The company has grown revenue an avg. of 9% yearly over the last decade, so there is potential for continued growth in this proven compounder.

3. Home Depot

Homeowners are undoubtedly familiar with Home Depot, where they have probably spent weekends purchasing appliances, garden plants or tools for countless home projects to be completed. The company’s brand power, product selection and large store footprint have helped it continue to grow in the face of competition from online e-commerce businesses like Amazon. Revenue has increased an avg. of 7% over the last decade.

The stock has been a winner for a long time now, minting millionaires who have made even smaller investments in its IPO and had held them over the years. But Home Depot’s success story may not be over just yet. The company’s trailing 1 year revenue is around $147 billion, and Bank of America calculates the market’s total value in home improvement to be around $767 billion with a lot of room to grow to over $1 trillion in the future. Home Depot should see more growth opportunities to take more market share and benefit from the increased home-improvement consumer spending moving forward.

Today’s high rate of inflation is a great reminder that your savings account will need to grow just to keep your buying power where it is. One of the best ways to do that may be dividend growth stocks and growth stocks, which, after the most recent tech sell-off, are currently trading at better valuations.

Times of market turmoil can be uncomfortable, but these are often the best times for long-term investors to put their money to work. Here are the two growth stars that have a competitive advantage, giving them the staying power and also a pathway to making today’s investors rich years out into the future.

Microsoft

Microsoft makes for an excellent core holding for both defensive and aggressive investors. Its legacy operating system is an entrenched part of most personal computers around the world, and its software franchises that include the Dynamics enterprise resource planning suite and the Office productivity suite are cash cows that have been growing at a steady pace. Meanwhile, Microsoft’s number two position in cloud computing gives it a rising growth star, with the Azure cloud platform seeing growth of 46% this past quarter. Microsoft has also been making thoughtful acquisitions over the last few years under the CEO Satya Nadella, into the social media space with LinkedIn, developer tools with GitHub service, and some video games, with acquisitions of a few game studios culminating in the most recent offer to purchase Activision Blizzard.

Microsoft’s sprawling empire so far has a nice combination of growth stars, cash cows and emerging services and products, compounding your investment dollars at a very high rate of return on invested capital.

Microsoft may not look like a cheap stock at 31 times earnings, but when you think about the fact that it has a higher credit rating than the United States government, and that the 30-year United States Treasury bond only yields about 2.25% today, Microsoft’s 3.3% earnings yield looks great. That is especially when those earnings are continuing to grow over 20% each year despite the Microsoft’s huge size.

ASML Holdings

You might have heard that we have a semiconductor shortage, because of the increase in digitization that’s coming out of the Covid pandemic. The importance of these chips and chip-production has never been higher than it is today, as evidenced by the developing countries set to offer billions in subsidies to chip businesses just to keep some of the chip capacity in their own countries. Yet because of the wider tech sell-offs, the semiconductor index has decreased about 14% to start the year off.

The sell-off has been harder on the higher-multiple chip stocks such as ASML Holdings, which is down 18.6% for the year and 27.4% from its all-time highs that was set this past summer. ASML still deserves a high multiple, given that it does have a monopoly on extreme ultraviolet lithography — the main technology to creating leading-edge chips.

EUV tools have only began to be utilized a few years ago for the leading-edge logic chips, and all the main DRAM memory businesses are now starting to use EUV on their current and future nodes. So, we’re still in the early stages of EUV usage.

Indeed, it is possible to retire a millionaire with just ETFs alone, as long as you can manage your end-to-end financial plans the right way. You will need to start investing early enough, invest enough of your money in an aggressive enough plan, and convert some of that money to higher certainty options as your retirement nears. In a lot of ways, in fact, ETFs could make your investing job a little easier as you strive to have millionaire status by retirement.

Why ETFs are able to help you out

An ETF is really just a pre-designed assortment of investments. The main advantage of an ETF is that it provides a one-stop-shop to purchase multiple investments within its framework of the underlying strategy, many times with lower overhead costs. That allows you as an investor to focus on the overall strategies that you are interested in following, and then allow the ETFs do the work of choosing the specific investments for that strategy.

If you would like to get the longer-term benefits of investing without the effort or hassle of scouring your financial statements to attempt to separate the losers from the winners, ETFs could be a great tool to have in your arsenal.

How long can it take for you to get there?

The more money you can put away and the higher the rate of return you can earn, the less time it will take to become a millionaire.

Over a long time period, the stock market has delivered yearly returns somewhere between the 8% to 10% levels, although those returns are not guaranteed. That makes market tracking ETFs a great tool to use for the long term to try and reach millionaire status.

Your monthly investment amounts are based on maxing out your IRA and 401(k) contributions for the entire year. In particular:

• $2,833.33 would max out both an IRA and a 401(k) for an investor that is 50 and older. The yearly limits in that age group are $7,000 for IRA contributions and $27,000 for 401(k) contributions.
• $2,250.00 would be a max for a 401(k) contribution for an investor who is age 50 or over.
• $2,208.33 would be a max for both an IRA and a 401(k) for an investor who is younger than 50. The yearly limits in that age group are $6,000 for IRA contributions and $20,500 for 401(k) contributions.
• $1,708.33 would max out the 401(k) contribution for an investor who is younger than 50.

There is one popular investor who has remained really quiet about the metaverse and its potential. Warren Buffett has not ever really been a big fan of many tech stocks. Unsurprisingly, the multibillionaire has not publicly hopped onboard the metaverse bandwagon.

However, do not think for a second that Warren Buffett would not like to profit from the metaverse if it takes off as many predict it will. And Buffet already has a dog in the hunt. Here is Buffett’s favorite metaverse stock.

The apple of Buffett’s eye

There are actually several metaverse stocks that Buffett likes which might win in the metaverse. Berkshire scooped up some shares of Activision Blizzard in Q4 of 2021. Microsoft announced its plans this past month to acquire the gaming company, saying that the deal would be helpful in “provide building blocks for its metaverse.”

Berkshire also owns a large stake in Chinese battery and EV maker BYD. The business recently applied for a trademark “BYD Metaverse.”

However, Warren Buffett’s favorite metaverse stock happens to be the apple of his eye. Apple comes in ranked by far as the largest holding in Berkshire’s equity portfolio. Warren Buffett has even said in the past that Apple is “probably the best company I know of in the world.”

Missing out on the metaverse?

But should Apple really be seen as a metaverse stock? After all, Apple did not join in the metaverse frenzy this past year. As recently as just a month ago, you could find articles that discussed how Apple did not have any major metaverse plans in the works.

Apple CEO Tim Cook has set the record straight, though, with what he said in the company’s 2022 Q4 conference call. Cook was questioned about Apple’s possible role in the metaverse. He said that Apple is “in the innovation business” and is “always exploring emerging and new technologies.”

Cook also noted that there are over 14,000 augmented reality kit apps in the company’s App Store. He also added, “We see that there’s a lot of potential in the metaverse space and we are investing accordingly.” 

It should not be surprising at all that Apple does indeed have plans to be a player within the metaverse space. The company has consistently been the main innovator in consumer tech. Apple is reportedly creating an AR/virtual reality headset and AR glasses. The potential of the metaverse for these devices is big– even if Apple may not hype it up as much as some would like.

This giant should keep growing

The metaverse is just one possible growth driver for the company. The smartphone market around the globe continues to grow. Increased availability of 5G provides a strong tailwind on this front for Apple.

Apple is also reportedly creating a self-driving vehicle. Analyst Katy Huberty believes that Apple can double its revenue if it dives into the self-driving EV market.

Warren Buffett may remain quiet about the metaverse for now. But the performance of his stake in Apple might do all the talking that is needed. This tech giant should continue to grow a lot bigger over the next ten years and beyond.

A 401(k) is an excellent retirement savings method, but you need to know how you should use it to get the most out of it. There are so many rules that surround these accounts, it is easy to make terrible mistakes if you are not careful. There is one mistake in particular you will want to avoid at all costs if you are trying to maximize your savings.

Don’t leave any money on the table

You will probably end up paying for most of your retirement expenses all by yourself, but if you qualify for the 401(k) match, you might get some help from the company you work for. Just As long as you add to your 401(k) account, your employer will also add some cash in your 401(k) for your future. However, this is a limited-time offer.

After the year is over, your opportunity to claim a 401(k) match for that year will be gone. If you were to skip your 401(k) contributions, you are essentially giving up a big bonus — one that might be worth a few thousand dollars in the future.

Every business has its own unique 401(k) matching formula, so discuss this with your HR department to find out how yours will work. The most common approach is to do the dollar-for-dollar 401(k) match on 3% of your salary or do a $0.50-on-the-dollar 401(k) match on 6% of your salary.

So, if your salary was $50,000 this year, that means you would contribute either $1,500 or $3,000 of your personal money and the company you work for would put in another $1,500 for you. And each year you work there, you will be able to earn another $1,500 match from your employer– or even more than that if you were to get a raise in the future.

If you have consistently earned the $1,500 match over a 20 year span and that money earned an 8% average yearly rate of return, your matches by themselves would be worth over $71,500. And that is not including any contributions of your own money. If you had contributed $1,500 of your personal money each year, you would have double that within 20 years.

But just because it is in your account does not mean it’s yours

You should definitely try claiming a 401(k) match if you were to qualify for one, but you usually cannot just take the money out and run. Most 401(k)s will have a vesting schedule that will determine when your 401(k) match can actually belong to you.

Some businesses have what is called a cliff vesting schedule. This states that you must work for the employer for a certain number of years before you are allowed to keep the employer-matched 401(k) funds if you were to quit your job.

Others use what is called a graded vesting schedule, which is where your 401(k) match will be released to you gradually over a period of time. You may get to keep 25% of your match if you quit the job after one year, 50% if you quit after two years of working for the company, and so on.

Once you are fully vested, you could take all employer-matched funds out once you leave the company. If you are not sure whether you are fully vested already, it would be a good idea to check with your HR dept. Those who are not may want to stick with their current job for a while longer, so they do not forfeit some of their retirement savings.