Archive for the ‘Finance’ Category
I’ve Always Tried . . .
. . . to pay my taxes
with a smile,
but the IRS
keeps insisting on cash.
When Anyone Asks . . .
. . .”How’s your day going?”,
I give them the only factual answer I know:
“With the rotation of the earth.”
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Investors Need to
Wade Through Lies
A report released a few years ago revealed that a majority of financial planners lie about their method of payment when questioned by clients and prospects. That’s not surprising. What’s surprising is that a survey, conducted by the National Association of Personal Financial Advisors (NAPFA), had to be taken in the first place.
People lie, whether they’re financial planners, teachers, police officers, neighbors, bosses, merchants, politicians, salesclerks, mechanics, butchers, bakers or candlestick makers. Three days into my first job as a daily newspaper reporter, my city editor told me, “People out there are paid to lie to you.”
Now that you realize financial consultants, like the rest of us, toy with the truth, you might want to focus more personal efforts on your own financial future. It’s up to you to machete your own way through the financial jungle out there
A simple first step is to learn how to recognize a bad investment. There have always been fraudulent high-flying can’t-miss investment schemes since before the stock market erupted on the scene.
Be wary of any outfit claiming to offer a break-through product or service that will topple the big guys, such as AT&T or General Motors. An especially flagrant “beware” sign should also be envisioned when a company applauding its success, or successes, has just switched industries. A successful skateboard company may not be able to produce pet food profitably.
Walk away from investment opportunities that offer “golden sunsets” because of major contracts and alliances, none of which are identified, especially if a strategic linkage announced previously had to be retracted. Remember: if I let you use my telephone, I can claim that I have formed an alliance with AT&T to provide you that service.
The Difference . . .
. . . between weather forecasters
and politicians:
the weather folk admit they’re wrong most of the time.
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Emotional Stress
Tarnishes Legacy
Mature Life Features
A former neighbor recently received news she thought would never happen to her: a rich uncle died and left her some money. Not a lot, mind you, but it was an inheritance, a totally unexpected legacy.
Most people have some idea what they’d do with a financial windfall: pay off the mortgage, buy a new car, take cruise around the world – it depends on how much money is involved. But then what? It isn’t easy becoming wealthy overnight. Stories of the profligacy, foolishness, or ill-luck of lottery winners pour out of the news media with regularity.
In the case of our acquaintance, she immediately quit her part-time job, paid off the small debt she had, and sought out a financial adviser. She invested he remainder of her inheritance in safe income-producing financial vehicles to augment her monthly Social Security checks. Then she decided to move to another state to live with one of her children after discussing the matter with them and the rest of the family.
It has been estimated that current retirees will pass on more than $10 trillion to their heirs. Many beneficiaries of this largess have grown up poor or in modest circumstances, or have mismanaged their finances throughout their lives and have little concept of the challenges they face.
Do they put that $10,000, $100,000, or $1 million into the stock market or real estate? Do they sell the company they inherited, or do you try to keep it running? Do they keep all the stocks, bonds, and mutual funds in the portfolio that suddenly becomes their property?
Financial planners consistently offer this piece of advice: don’t do anything for awhile.
That’s more difficult than it sounds. Forty percent of baby boomers who received an inheritance of at least $50,000 made their financial decisions in less than a week, according to an Oppenheimer Funds survey.
While the financial facet requires patience and some effort to educate yourself on the best avenues to follow, the emotional side of inheriting can be a much more difficult challenge. The inheritance usually is intertwined with the death of a loved one and, as a result, associated with grief. Guilt often is a major emotional component of a legacy, leaving the heir feeling uncomfortable with not having earned the money.
There’s also a feeling of isolation compounded by the discomfort and worry inflicted by friends and family members badgering them for loans and gifts. The emotional stress causes many folks to get rid of their inheritance as quickly as possible.
On the other hand, people who take their time to plan what to do with an inheritance have been known to husband their wealth and continue living in their current lifestyle with the comfortable assurance that their financial future is secure.
Got A Problem . . .
. . . with your cell phone, computer, laptop or tablet?
No need to call,
just show up at noon in the lobby
and let the Fourcher Tech lads solve it for you.
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Planning Your Future
Includes Your Funeral
A neighbor’s husband took care of her, both emotionally and economically, until his death early last year. More than six months later, even with the assistance of her family attorney, she is still looking for documents vital to tying up all the loose ends in the estate.
While she’s alone in her predicament, she’s not alone in the number of men and women left stumbling in the dark after a spouse’s death. It seems that, along with prostate cancer, gaffes at work, and spousal-abuse, nobody wants to talk about their death. But everyone faces it. So a bit of planning is in order.
Several years ago, a friend who was the police chief in a city far away, was diagnosed with raging cancer in his early 40s. He was given weeks — not months — to live. He called all his friends and colleagues to a night at a local club and hosted a farewell party. At the beginning of the evening, he told everyone of his situation, told them all to eat and drink up and that he didn’t want to see them anymore because he wanted them to remember him as he was that night.
You don’t have to do the same thing. You can acquire a life-insurance policy payable on your death to be used to pay for the casket and caterer when you die. You can pare the price by opting for less-expensive cremation rather than pay for an elaborate and costly sealed box to house your remains underground.
You can work out your own funeral plans simply and economically. First ask yourself if you want an elaborate service and several-day visitation or do you prefer a simple gathering of relatives and friends. Do you want to be buried in a casket or is cremation your preference.
What does your family want? Discuss it with them.
Just as sure as you were born, with which you had nothing to do, you’re going to die, and you can so do something about those arrangements.
Most Folks Believe . . .
. . . it’s a good thing that
we have two parts to our brain,
but on the left side, there’s nothing right, and
on the right side, there’s nothing left.
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Emergencies Call for
Financial Hand-off Plan
You’re enjoying your vacation in your favorite village across the sea when you crash into a truck and you and your spouse are rushed to the nearest hospital with injuries that require weeks of treatment.
Who’s going to handle your financial affairs while you’re both bed-ridden in a foreign land?
Just thinking about all the things you have to do could kill you. You have to deal with local authorities after the crash, have the medical team caring for you contact your doctors back home, decide whether to have surgery where you are or try to get back home to have it done, re-arrange your return-ticket and travel arrangements, and make sure bills are paid back home if your medical treatment requires you to stay abroad longer than anticipated.
This is just one example of an unanticipated emergency that can mangle your life fiscally as well as physically.
To prepare for such events, you might consider having someone – usually a family member — to be ready to step in and take over your finances.
It doesn’t have to be permanent, but you should put together a financial plan that can be handed-off quickly when a disaster dumps on you.
Start by simplifying your finances.
Cut down the number and types of banking and credit-union accounts you have. If you have Social Security, retirement-fund, pension and any other payments being made automatically, have them consolidated into one account. Whoever has to stand in for you financially during an emergency will have no idea how you transfer funds from one account to another.
Eliminate electronic payments. Keep your papers bills and statements coming in by mail. This assures anyone picking up your money management will see all your bills.
This applies especially to credit cards. You might also cut down on the number of cards. Two or three are enough. Make a list of all accounts, credit cards and store cards you have.
List all recurring payments — utilities, internet service provider, rent or mortgage, medical and auto insurance, and so on. Also list any other sources of income,
Make copies of your driver’s license, Medicare and medical supplement cards to attach to that list. This will help your helpers identify themselves as your proxy. Keep this list in a spot handy enough so your agent can get at it quickly.
Don’t dump this job on someone who doesn’t want it. If all your family members don’t want or can’t handle such matters, you might consider hiring an attorney to handle your money matters when the unexpected blind-sides you.
You Know . . .
. . . you’re getting old when,
The Heat arrives and
you have to ask yourself
if you want a nice dish of ice cream
or a nice cold glass of beer.
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Test Your Financial IQ
So your braggart broker brother-in-law bugs you about not taking his advice and making a billion in the stock market. Or you think you have all the answers to present and possible problems in your financial future.
A financial IQ test published in Kiplinger’s Personal Finance magazine could put both of you to the test with a few basic questions that examine some rudimentary tenets of a sound personal fiscal policy.
A fun question asked how big a check you think you would get if you chose the cash option after winning a lottery jackpot of $100 million but had to split it with another person who also had the winning lottery number. After cutting the winnings in half and choosing a one-time cash payment, you would get a check for about $20 million.
By taking the one-time payout instead of monthly payments over 30 years, the prize amount is whittled down based on what is known as the “time value of money” according to a formula comparing the worth of today’s dollars against $1 three decades from now. This cuts your half-share of the lottery winnings to about $27 million, of which the Internal Revenue Service will claim some 25 percent. And then there are layers of other state and federal taxes to cut through before being able to tote your final total to the bank.
Then there’s the question about remarrying after your spouse of several decades has died. Should you marry the person who has emerged in your life as a possible mate or should you just move in and live together so you don’t forfeit Social Security survivor’s benefits based on your late husband’s hefty earnings history.
Go ahead and remarry, the article states. Widows and widowers 60 years and older may remarry and collect benefits based on their deceased spouse’s record if its more than what they’ve earned.
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A Friend Recently .. .
. . .mulled replacing some of her furniture
but she gave it up because she said
she and her recliner go way back.
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Caregivers Pay Economic, Emotional Prices
Besides the shoulder-stooping emotional cost of caring for ill and ailing loved ones, there is can be an enormous economic price to pay by the more than 22 million U.S. families who provide such care.
Caregiving costs individuals some $660,000 over their lifetimes in lost wages, and lost pension contributions and Social Security because they take time off, leave their jobs or miss out on opportunities for training, promotions, and plum assignments.
Almost 85 percent of employees reportedly make adjustments to their work schedules by taking sick leave or vacation time, decreasing work hours, taking a leave of absence, switching to part-time employment from full-time, resigning, or retiring.
Elder care has more negative impacts on workers than does child care, particularly for those who are the primary caretakers for an older adult. Taking care of an aging parent is always difficult, but it is even more difficult for employees who have to care for their parent in their own home. It essentially means employees have a second shift of work when they get home.
As the population ages, the number of caregivers grows and the personal and corporate costs rise. Employees who care for elderly or sick relatives with long-term-care insurance are twice as likely to stay in the workforce as are workers who care for relatives without coverage, according to data from three MetLife institute surveys.
In addition, working caregivers of loved ones with long-term-care insurance coverage are less likely to experience such types of stress as having to provide constant attention to the care recipient or having to offer caregiving while ailing themselves.
Thirsty Thursday . . .
. . . is always welcome and
it’s a bridge to Friday’s Super Supper Shuttle
that gets us to
Olive Garden,
Old Chicago Pizza,
Village Inn and
In.N.Out Burger this week.
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Compound Interest Beats the Odds
Famed physicist Albert Einstein is credited with describing the most powerful force in the universe as “compound interest.”
Yet just as many people who don’t understand his theory of relativity also don’t understand what he was driving at in this instance.
Three out of 10 Americans think their best chance of amassing half a comfortable financial cushion in their lifetime is to win a lottery or sweepstakes, according to a Consumer Federation of America poll. The odds of winning a lottery are one in 10,000,000 to 20,000,000.
When the Consumer Federation asked how much money you would earn by investing $25 a week for 40 years at a 7 percent return, no one guesses as high as the actual amount — $286,640. Invest $50 a week at that same 7 percent rate – the average annual return of the Standard and Poors 500 — for the same period and you double that amount, which is well more than half a million dollars.
What makes compound interest so powerful is that you not only earn interest on the money you put into an investment, but you also earn interest on the interest. If you put $100 in an investment program at 7 percent, you should have $107 at the end of the first year. The next year you earn 7 percent on the $107 not just the original $100.
Dr. Raz in Residence
Therapist Dr. Candace Raczkowski
will introduce her healing service to us at
1 p.m. in the 2nd floor theater
Her knowledge, experience, training and background
treating and preventing problems with
balance,
post-surgical recuperation,
joint inflation and
a wide-range of chronic conditions
will help most us overcome stiffness and pain.
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Married Couples More Wealthy Than Singles
Just like love and marriage, marriage and wealth‑building go hand in hand.
Don’t leap astride your high horse should someone suggest you or a dear friend or relative is marrying for money.
A Purdue University study reveals that marriage has a lot to do with wealth accumulation. Getting and staying married appears to provide institutional benefits that greatly impact long‑term economic well‑being.
A survey of more than 7,000 households that included at least one pre‑retirement person between 51 and 61 years of age indicated that people who never married had only 14 percent of the financial assets that married people accumulated.
Even when divorced individuals and surviving spouses remarried, they still did not make up as much financial ground as partners who were continuously married. The negative effects are greater when a marriage ends in divorce.
Financial potentials that are greater in marriage include home ownership, insurance coverage for spouses, survivor pension benefits, and increased rates of saving. A continuous marriage is more important to acquiring housing equity than other type of assets.
Which leads sponsors of the study to warn married couples pondering divorce to consult with a financial counselor before calling their attorneys.
A financial consultant can help because quickly liquidating jointly held property and establishing two households with the proceeds can be costly to both parties. And spinning off from that is the need to review individually held property before forging a marriage contract, whether it’s the first marriage or the latest in a series. Pre‑nuptial financial agreements should be given as much priority as legally binding romantic bonds.
Mature Life Features 