If you're like me - at some point as a kid - you pushed all the buttons in an elevator, making life a bit more miserable for those with places to be. Elevators are like the stock market - they go up - and they go down. But when markets go down, unlike the elevator,...
The Excruciating Cost of…Costs
Ever meet an investment advisor who doesn’t wear a nice suit, drive an expensive car, or live in a posh neighborhood? Ever see an investment firm in a rundown strip mall, next to a Dollar Tree or Goodwill store? There’s a reason. Accessing Wall Steet exchanges...
Reverse Crystal Ball
If you’re under the age of 35, chances are you have never personally experienced a bear market where stock values go down by 20% or more from their highs. That’s because there hasn’t been a bear market since the 40% collapse of 2008-2009. In fact, the...
How to Reduce Your Student Loan Balance in 2021 Without it Costing a Dime!
Shortly after the pandemic began, the Trump administration suspended payment requirements on government student loans. The Biden administration recently extended payment deferment through September 2021. Deferment – in this case – means that not only is...
Death by Credit Card
It would be nearly impossible to function in today’s world without using a credit card from time to time. And so long as we pay the balance off each month – that convenience comes our way free of charge – and who doesn’t like free? But carrying balances on our...
You’re in Control!
Look – debt is nasty stuff. After the ‘shine’ wears off of the stuff you bought – the payments linger and begin to smell – bad – really bad. Debt is a financial drag. It shifts priorities away from the things that are most important (like our families) – to...
Houston – We have a Problem
Recently, my daughter and her husband undertook a complete – and expensive – renovation of their kitchen. It was a long project – and with a toddler running around, the inconvenience of living without a kitchen was – well - a bit trying. What made it worse was that...
Five Financial Adjustments to Consider in a Covid World
Who would have thought – way back in March when this whole thing took over our lives – that this tiny virus would still be impacting our lives so significantly at Thanksgiving? Well – here we are. So we’ve put together some year-end thoughts about how you might clean...
What the heck is ‘Amortized’ Interest (and why should I care)?
When a bank loans money – it charges interest for the use of that money. Think of interest as rent. Say we borrow $12,000 – and agree to repay it over 10 years at an interest rate of 5.46%. Based on those loan terms, our total interest charge will be...
Have They No Shame!
Let’s face it – in today’s world, it’s nearly impossible to live even a modest life without taking on debt from time to time. Unfortunately, modest debt has given way to overwhelming debt for many – and the impact, given the fragility of our economy in this...
An Open Letter to College-Bound Kids
What your parents want you to know – but are too romantic to tell you! Warning: you’re not gonna like what I’m about to share with you – but you need to hear it. You may be thinking, ‘my parents – romantic?’ In this case – yes – they are. You see,...
Have You Opened your Gift from the CARES Act Yet?
Congress passed the CARES act shortly after the Coronavirus outbreak. One feature of the Act allows those ‘impacted by the virus’ to withdraw up to $100,000 from a qualified plan (401k, IRA, and others), without the usually 10% penalty (for those under 59-1/2)....
Where the Coronavirus may have a 20% Mortality Rate
CAMBRIDGE, MASSACHUSETTS - MARCH 12: Harvard Sophomore Jordan Di Verniero, 19, sits with her belongings in front of Eliot House before returning home to Ormond Beach, Florida, for the rest of the semester on March 12, 2020 in Cambridge, Massachusetts. Students have...
10 Reasons Millennials should ditch the 401k
In today’s market, there are products and options that are far superior to the now 45 year-old qualified plan – plans that are not one-sided partnerships.
The Bond Myth
Bonds are generally regarded as tax-inefficient because the interest payments are always taxed as ordinary income – the highest rates in the code. Unless of course, you buy tax-free municipal bonds. But it turns out those aren’t so tax-free either.
Dumb Money, Scared Money, and Smart Money
More and more savers are discovering that insurance products uniquely fit the bill – particularly indexed life insurance and indexed annuities. In fact, much of the money that has fled the market in the last several months is finding its way to insurance companies because of their feature set.
Revisiting the College 529 Plan
We are advocates of a plan that is also funded with after-tax dollars, and like the 529 plan, is accessible tax-free. It doesn’t generate a state tax credit, but it also eliminates any FAFSA penalty, and those tend to cancel each other out.
Where our plans really shine is that they are not exposed to market risk, and they can be used for any purpose – college, starting a business, travelling the world, or starting a killer long-term tax-free retirement account.
Had Enough Yet?
The S&P 500 is down 8% this year already — including another 2.2% Friday — in what’s been the worst start to a year ever. Since the market peak on May 21, 2015, the market has declined 11.7%.”
Reset – 5 Financial Considerations for the New Year
Then, think about the really big things that can happen to you. For example, what if I… 1) Die too soon, 2) Live too long, or 3) get sick?
My failed relationship
… find a qualified, interested prospect and make a deal happen. The problem is, most realtorslive in a Field of Dreams – believing that “if we list it, they will come.”
Why Almost Everyone will Overpay For College (Part 3 of 3)
A college is a business. You are a potential customer. You represent 4.5 years of tuition, room, board, books, and an economic participant in the college community. Even at a modestly priced school, chances are you represent at $150,000 “client.”
Why Almost Everyone will Overpay For College (Part 2 of 3)
Today, there are a staggering 2,000,000 parents collecting Social Security Benefits while they’re still paying on parent loans (some are drawing Social Security just to pay on those loans), and a mind-boggling 300,000 of them are having their Social Security benefits garnished to pay their parent debt down!
Why Almost Everyone will Overpay For College (Part 1 of 3)
How many Quarter Million Dollar mistakes can you make in a lifetime without it seriously affecting you?
The good news is that whether the Junior at your house is 8 or 18, it’s not too late
Cash Value Life Insurance as a Retirement Saving Tool?
Lately, I’ve been doing quite a bit of speaking on the subject of cash value life insurance as a savings vehicle and a source of retirement income. Without going into detail here, let’s highlight a few of the reasons that properly structured cash value life insurance...
Market 2015: Is this the “Big One?”
Every day – every year, I tell audiences nationwide - on radio, television, in print, and in person, that they need to be paying much more attention to the Three Wealth Killers (Market Risk, Taxes, and Fees/Commissions); and much less attention to the latest whiz-bang...
Is Your Retirement Plan Fuzzy Math?
Effective planning requires evaluating options, making strategic decisions, and then acting in a way that lets you achieve your goal. For most people, a retirement plan requires careful consideration of all these elements to ensure a reasonable lifestyle when work is...
The Five Tax Gotchas
No one likes the idea of learning bad news after it’s too late to do anything about it. But that’s exactly what most Americans will discover when they reach retirement. Are you one of them? You are if you’ve fallen victim to the allure of tax-qualified plans like...
The Retirement Drawdown Question
I published this a year ago, but it still seems relevant so I wanted to put it back out there. -Jay A recent article from Yahoo Finance (The Risks of Spending Your Retirement) had an interesting take on issues related to drawing income from one’s nest-egg in...
The High Cost of ‘Free’ Money
We know – by the rule of 72 – that money growing at 7.2% will double in 10 years. So $100 pre-tax dollars grows to $200 in 10 years; and $75 after-tax dollars grows to $150 in 10 years. That’s their proof.
However, when that $200 is taxed at the same 25% rate, the qualified account ends up with – surprise – $150. There is no mathematical advantage to tax deferral.
The Paid-Off Home Myth
If I have $1,000,000 in an IRA – the reality is – I really only ‘own’ the after-tax equivalent – say $700,000 if my tax rate is 30%. The rest belongs to Uncle Sam – I’m just ‘holding’ it for him, temporarily. So if my account grows by 10%, my portion of that growth is $70,000, and my deferred tax liability (debt) grows by $30,000.