Money Minute: Rents Go Sky High; Netflix, Amazon Content War Erupts

The cost of apartment rentals is going up faster than the rate of inflation.

A real estate research firm says apartment rents have jumped 3.2 percent from a year ago. It's a simple matter of supply and demand. More young people are finding jobs and leaving their parents home or the group living arrangement they've been in, while the vacancy rate continues to decline. And experts say this trend is likely to continue.

Americans are much more optimistic about their personal finances than they were just six months ago. A newly launched index from the Consumer Bankers Association and AOL -- the parent of Daily Finance -- finds many of us have shaken off the slumber brought on the government shutdown last fall. Since then, the stock market has rallied and the nation's employment picture has brightened.

The content war between Netflix (NFLX) and Amazon.com (AMZN) is on. Amazon's Prime Video Service has won the latest skirmish, getting exclusive rights to the upcoming encore series of the Fox TV (FOX) hit, "24." %VIRTUAL-article-sponsoredlinks%The 12 episode Jack Bauer sequel, "24: Live Another Day," begins on May 5th. Amazon also gets exclusive rights to all 192 episodes of the hit TV drama. Amazon recently won the rights to two other hit TV series, even though they may not appeal to same audience: "Downton Abbey" and "Spongebob SquarePants."

Here on Wall Street, the Dow Jones industrial average (^DJI) gained 75 points Tuesday, the Nasdaq composite (^IXIC) jumped 69, and Standard & Poor's 500 index (^GPSC) gained 13 points, hitting its seventh record high this year. And the Dow is within 44 points of the all-time high it set on Dec. 31 last year.

Finally, Starbucks (SBUX) is responding to customer complaints and bringing back some menu items. You'll soon be able to buy slices of banana, pumpkin or lemon loaf cake. The breakfast market is heating up, and as Bloomberg notes, Starbucks wants to provide fancier offerings than fast-food competitors, without getting too fancy.

-Produced by Drew Trachtenberg.

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Money Minute: Rents Go Sky High; Netflix, Amazon Content War Erupts
The 1099 forms you received from brokerages and other financial institutions might not be the last ones they send. It's common for them to issue corrected versions a little later. Consider getting your tax return ready to go, then waiting until close to April 15 before submitting it. That way, you can incorporate any last-minute changes and avoid having to file an amended return.
Pay attention to when you sell any holding, because the capital gains tax rates differ for long-term and short-term holdings. Short-term capital gains are taxed at your ordinary income tax rate, which could top 30 percent. Long-term gains (those held for more than a year) get preferential rates, which are zero percent for those in low-income brackets and 15 percent for most of us.
If you own underwater stocks, consider selling them for a loss. You can use those losses to offset gains from other sales, reducing your taxes owed. You can always buy back the asset later, if you still believe in it -- just be sure to wait for 31 days to pass, to observe the "wash sale rule."
If you're planning to sell one or more holdings that will give you a really big gain, submit an amended W-4 form to increase your withholding, or send the IRS an estimated tax payment. Underpaying your taxes significantly during the year can lead to a penalty at tax time. You may be protected by a "safe harbor" provision, though, which can save you from having to jump through those hoops.
If you're planning to buy shares of a mutual fund, determine when it will distribute its dividends. Many funds do so near the end of the year, and when that happens, the fund's share price will drop by the amount of the distribution -- which is taxable to shareholders. It's better to just wait until after that payout to buy in.
Mutual funds with high turnover ratios (reflecting a lot of buying and selling in a fund) have expenses for these trades. It's worth favoring funds with low turnover ratios, especially index funds and index-tracking ETFs, which simply hold onto the mix of securities in a given index, without a lot of trading activity. (Index funds generally outperform their higher-turnover counterparts, too.)
Boost the power of your Individual Retirement Accounts by making your annual contributions early in the year, giving the funds more time to grow. Over decades, it can make a significant difference.
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