Mature Life Features

Cecil Scaglione, Editor

Archive for the ‘Finance’ Category

No Such Thing as a Stupid Question . . .

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. . . when you invest.

Betting on the Super Bowl is easier than gambling on the stock market. There are only two teams and one of them is sure to be a winner.

Rather than toss the dice against the vagaries of the various markets that contain thousands of stocks, investigate before buying anything. You wouldn’t go out and buy a car and then bring it home to check out its performance.

Shy away from securities offered on the telephone or by e-mail. Deal only with a securities firm that you know or one recommended by a person who is familiar with the investment industry. You might ask your tax preparer, attorney, or accountant for a referral.

Beware of promises of quick and too-good-to-be-true profits as well as high-pressure tactics by the sales people.

Don’t be afraid of “asking a stupid question.” You’re only being stupid if you don’t ask questions about something you don’t understand and still go ahead and invest your money on it.

Written by Cecil Scaglione

November 30, 2021 at 3:00 am

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To Be a Big Gun in Business . . .

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. . . get yourself an M B A

and make sure you don’t get fired.

Written by Cecil Scaglione

November 20, 2021 at 9:44 am

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Lending to Family Member Not Good Business

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Neither a family borrower, nor a family lender be, to paraphrase Shakespeare.

Shakespeare also wrote that lending money to a friend is an excellent means of losing both your friend and your money. But with a relative, you lose your money and the family ties become frayed.

A colleague lent in-laws half the price of a home to help them acquire the property. It didn’t take long for the in-laws to resent the situation. Not only have they not paid off any of the loan, they’re no longer speaking to their benefactor.

It’s been estimated that as much as $65 billion is lent to a family or friend.

It seems logical for people to turn to their parents or siblings in time of fiscal misfortune.

But before you dig into your pockets to bail out a relative, ask yourself several questions.

First of all, do you need the money? If you do, how are you going to be able to go after it when your relative shows no sign of repaying you?

If the borrower-to-be has a history of overextended credit cards, late rental payments, or job-hopping, you’re foolish to expect the money will be repaid.

The use of the money is an important factor. If the loan will be used to enable a family member to complete a college education or help elderly parents keep their home or give a start-up boost to a family entrepreneur, you might give the matter serious thought.

Making a loan to your grandson and his wife so they can splurge on an anniversary cruise or to a daughter who collects race horses makes much less sense.

Parents have another concern: giving a loan to one child may spark jealousy in the other children.

Family and financial experts agree on one major point: worse than the loss of money in any of these person-to-person transactions is the fracture of the relationship. In many cases, the borrowers, either through guilt or resentment, distance themselves from their benefactors.

Putting things in writing can avoid some of the personal pitfalls. This is a financial transaction and should be treated as such.

Lender and borrower should agree upon and write down the amount of the loan, interest rate, and payment schedule. If you need to run it buy an attorney, do so. It’s a good idea to have the signing of the loan document witnessed or notarized.

If the person makes a request for money and doesn’t see it that way, you can suggest bluntly that if he or she wants charity, ask for it.

Written by Cecil Scaglione

November 19, 2021 at 5:00 am

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With Inflation Hoisting Prices . . .

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. . . we’ll soon have to get a loan to buy stamps

so we can mail in our payments.

Written by Cecil Scaglione

November 17, 2021 at 5:00 am

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Tax-Preparer Can Help You Enjoy Christmas

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While spending money may be taking most of your attention during the Christmas Season, you should take a moment to make some plans on how to save some money before the end of the year rolls around.

You can join the millions of taxpayers who accounted for more than $470 billion in tax-deductible charitable donations last year. Just make sure your check is in the mail before Dec. 3 and always get a receipt for anything you give to a non-profit group.

Take care if you’ve finally decided to fork over the family flivver to a charitable organization. The Internal Revenue Service has cracked down on abuses of this practice. No longer do you deduct the Blue Book (considered the market price) figure listed for your ancient auto. The norm now is to take what the organization gets for the vehicle when it is auctioned off.

As with all tax-related matters, discuss your plans with your tax preparer before making any decisions.

When you review your charitable-giving for the year, you might consider a gift of stocks and bonds that will not only elicit smiles from the recipient of your largess, but make yourself feel financially merry, too.

Review your investment portfolio. If you have some money-makers that could shove you into deeper tax-paying waters, consider giving a portion of them to your favorite charity to lighten your tax burden.

Written by Cecil Scaglione

November 15, 2021 at 5:00 am

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No Need to Gag on Gasoline Prices

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If you no longer need a family car — you fly to vacations, walk to the grocery, and take cabs to the dentist — you’ll save yourself tons of money.

You have no car payments, no insurance premiums no maintenance costs, and no need to haul a pocketful of credit cards to the nearest gasoline pump to fill your tank. The money you save buys a ton of cab trips.

The thought of not having a vehicle parked in the garage or driveway makes most people shudder. The thought of conspiracies, government meddling, foreign control, distribution problems, and a host of other reasons, real or imagined, driving up the cost of a gallon of gasoline prompt these same people to carp and complain. Fuel prices are getting as much talk time these days as does the weather.

Just as a few adjustments will help you beat the weather, such as heading south if it’s cold or for the beach if it’s too hot, there are a multitude of moves you can make to avoid being hammered by rising gasoline prices if you don’t want to sell your car.

Plan your trips. If you have a list of chores to do, take a moment to mentally map out the shortest route to combine them all. In other words, don’t drive to the dry cleaners, then drive back home to drop off the clean clothes, and head to the nursery to pick up some houseplants, drop them off at home, and then motor to the supermarket for groceries.

After cutting down on the length of your trips, reduce the number of trips. When you’re not driving, you’re not using gasoline.

Mechanics and motorists pretty well agree that speeding slurps up the gasoline. “Speed limit” driving not only is safer, it saves you money.

At the pump, you don’t always have to buy the highest-rated premium gasoline. Your vehicle manual will tell you the octane-level your vehicle requires.

Keep your tires inflated properly. Under-inflated rubber causes “drag” and requires more fuel to propel your vehicle. Lift the hood and inspect your air filter. If it’s dirty, replace it. If you don’t know where it is, check your manual.

Check the oil level. And the transmission fluid level. Adding oil or fluid when required is no more complicated than pouring coffee into a cup.

Written by Cecil Scaglione

November 1, 2021 at 5:00 am

Tightwads Can Have Fun, Too

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Be a tightwad.

That doesn’t mean being miser­ly. You can still enjoy life, dote on your kids and grandchil­dren and enjoy va­cations.

But don’t throw your money around. Rich people don’t.

The road to tightwadism is at­tained by pinching pennies. That’s also the first step to­ward saving, which is in the general direction of invest­ing.

One thing requires clarifica­tion. Be­ing a penny pincher does not mean you buy “cheap.” It means you make cer­tain you get what you want and good value for what you pay. It doesn’t mean you buy the cheapest cut of steak. It means you buy the cut with the least fat and bone on it.

One of the first things you should do, if you haven’t al­ready, is consol­idate as much debt as possible, espe­cially if it’s size­able. A good working definition of debt is the amount of money still left to pay after you’ve paid all your month­ly bills. A mortgage is debt. (Al­though this can also be consid­ered an in­vestment, which al­ters the pic­ture.)

A car loan and size­able credit-card and store bills also are debt. And the in­ter­est rate on this type of debt can be expen­sive.

So, in true tight­wad fashion, con­sider consolidating all this debt into a home-equity loan, on which the inter­est is much lower than what you’re paying on your credit cards.

If you have to make a major purchase such as a piece of furni­ture, an ap­pli­ance, or an au­tomo­bile, wait un­til the end of the month to shop. That’s when these business oper­ators are anxious to meet monthly sales quo­tas. Before you go out to make such a purchase, take a hard look at what you intend to re­place to see if it can be re­paired or last another couple of years.

It’s also a good idea to buy ap­pli­ances in the off-season. Buy an air-conditioner in win­ter and a furnace during the summer.

You can pinch pen­nies around the house without even noticing it. Repair leaky faucets and re­place your light bulbs with flo­res­cent lighting. Open your drapes during winter to let the sun warm up your home. Close them during summer to keep it cool in­side.

Grocery shopping is a constant, so make a list of things you can buy in bulk — sugar, flour and condiments, for ex­ample — to save cents. And cook your own meals in­stead of calling for de­liv­ery. Chi­nese food and piz­za can be made at home for less cost and in about the same time it takes to be delivered.

Shop around for ge­neric drugs. Get approval from your doctor and druggist to do so. Then you can slash prices on some of your medicines.

When you shop for clothing, avoid anything with a label re­quiring “dry cleaning.” Wash­able clothing is just as good-looking and just as comfortable.

Written by Cecil Scaglione

October 25, 2021 at 5:00 am

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Only Your Computer Knows Virtual Money

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It’s a tenet of investing: if you don’t understand the company or product and what it does, drop it and move on to something else.

Which makes the Bitcoin story totally bizarre. Not only is it understood by a select group of financial high flyers, no one is really sure who started it.

Since the Bitcoin’s birth a dozen years ago, it’s travelled a bumpy road the stretches from a price of $400 five years ago to more than $60,000 earlier this year. Along the way it dropped to $4,000 in 2019 from $19,000 two years earlier.

But not to worry, if Bitcoin sounds a bit scary, there are more than 6,500 other cryptocurrencies on the market.

None of these currencies involve printing presses. They exist only in computers – cyberspace. Like Bitcoin, you can’t store any of it under your mattress.

There is a growing industry servicing the spending of Bitcoins after you buy them. They’re readily available at thousands of automated teller machines around the country.

The value of Bitcoin rises only if there’s a demand for it. If no one wants it, the value drops – dramatically.

If Bitcoin doesn’t catch your fancy, you can purchase Ethereum, Litecoin, Stellar, Polkadot, Cardano and, as pointed out earlier, thousands of other options.

And there’s a whole new language involved.

For example, Ethereum claims to be “a decentralized software platform that enables smart contracts and decentralized applications (dapps) to be built and run without any downtime, fraud, control, or interference from a third party.

“The goal behind Ethereum is to create a decentralized suite of financial products that anyone in the world can freely access, regardless of nationality, ethnicity, or faith.”

Did you get all that?

Transactions are conducted through a digital ledger called a blockchain. This involves a global computer network that stores the virtual money in a digital wallet.

A lure of cryptocurrency is the ability of blockchain to process and record software programs to transfer large sums of money around the world without an intermediary.

For example, it takes five days to transmit cross-border payments at an average fee of more than 6 percent, accounting for a $4 trillion business globally. Bitcoin cuts the transfer time down to about 10 minutes. Fees vary for the various currency forms. Some are no fee.

If you feel you understand the function of virtual currencies and see them as part of your financial future, make sure you understand the beginning, middle and end of what can happen to your money if you think you’d like to get involved and invest.

Written by Cecil Scaglione

October 22, 2021 at 5:00 am

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Came Up With a Good Way …

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. . . to stretch your budget.

Just write rubber checks.

Written by Cecil Scaglione

October 1, 2021 at 10:21 pm

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Just Ask

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The out-of-control spin ignited by Bev’s recent disastrous diagnoses of debilitating diseases – breast and spinal cancer and ALS – has become a bit more manageable because of some welcome experiences with care, comfort and support personnel and organizations we’ve encountered who have taught us to ask.

Our first major eye-opener occurred when we were faced with a thousands-of-dollars-a-month chemotherapy medication the oncologist prescribed. We said we just can’t afford that much. A patient advocate on staff called us in and asked for a copy of last year’s income-tax return. A few days later we were notified the medication would be provided for us – FREE. The staffer told us to just ask for her whenever we feel the need for some support, whether it’s economic or emotional.

Then, during our first appearance at the ALS doctor’s regular clinic, monitoring tests were conducted by several medical experts and we also met with an ALS organization volunteer. A few days later, a delivery man dropped by with toilet support bars (which he installed for us) and a transport wheelchair.

“They’re on loan until you’re through with them,” he said. “If there’s anything else you need, just ask.”

While there is no stopping the disease chewing away at her nerve cells, these are just a couple of the several events that are making Bev’s life more comfortable by simply asking.

 

Written by Cecil Scaglione

June 3, 2018 at 7:43 am