All Episodes - The Steve Pomeranz Show

Will February's Market Volatility Derail The Rest Of The Year?

January 2018’s 5.6% rise in the S&P 500 suggests shares will likely rise for the rest of 2018. Will February's rout cancel this old adage?

Now You Can Earn Royalties From Your Favorite Music Artist

Royalty rights is a rising alternative asset class that could help diversify your portfolio. It has its risks, so proceed with caution.

Considering Diversifying Into Real Estate? Know The Risks First

Real estate is a great way to diversify your investments provided you know how to calculate your real rate of return and are aware of the risks.

What Buffett's Real Estate Investments Will Teach You About Investing

With market volatility rising again, it's time to go back to the master. Buffett's 2013 Annual Report, is exactly what the doctor ordered.

12 Smart Financial Moves For The New Year: Part II

Get financially ahead in 2018 with 12 smart financial moves that help you save money, shore up your finances, and protect your identity.

12 Smart Financial Moves For The New Year: Part I

Get financially ahead in 2018 with 12 smart financial moves that help you save money, shore up your finances, and protect your identity.

Surprising Moves To Improve Your Credit Score And Change Your Life

Significantly improve your credit score and save hundreds of thousands of dollars in excess interest and fees over a lifetime.  

Don’t Let The New Tax Law Keep You From Buying Your Next Home

Don’t let the new tax law keep you from buying a new home. Instead, focus on low mortgage interest rates and the wonderful benefits of home ownership.

How Offshore Tax Evasion Schemes Are Hurting Us All

Find out how billions of dollars of potential tax revenue are being diverted through offshore shell companies and how it's hurting us all.

Trying To Change The World? Here's How To Put Your Money Where Your Mouth Is

Want to change the world for the better? Like the idea of giving back and doing good?  Get your investments to help with the heavy lifting.

Are You Protected From The Growing Epidemic Of Elder Financial Abuse?

1 in 10 seniors (aprox 5 million) are victims of elder abuse & neglect every year.  It's a major issue, so here's how to protect yourself & those you love.

Don't Let Unfounded Fears Stop You From Buying A Home

Don’t psych yourself out of the home-buying market due to unfounded fears. Instead, overcome those fears and become the proud owner of your first home.

Now Is A Good Time To Find Your Dream Employee

With unemployment at an 18-year low, find out how your company can hire dream employees in a tight labor market.

Financial Wisdom In 41 Savvy Tweets

Definitely read that heavy tome on investments and financial planning. But if you’re in a hurry, get your financial smarts through 41 witty tweets instead.

Looking To Buy Or Sell Your Home? 2018 Might Just Be The Year To Do It!

Real estate prices have risen steadily over the past few years. Will the trend continue? See what’s in store for the 2018 housing market.

Buying Your Next Home? Watch Out For Those Hidden Costs!!

People base affordability on down-payment, mortgage, taxes, and closing costs. But there are actually more expenses you should budget for.

Don't Fall Victim To These Real Estate Scams

Real estate scams are on the rise as people get more comfortable transacting online, sight unseen. Protect yourself with these simple precautions.

Do You Hold Too Much Of Your Company’s Stock?

Employees have made millions holding company stock. What we don’t hear is how employees have lost millions holding company stock. So where’s the balance?

The Secret To Successfully Flipping Homes

Flipping homes can be profitable, but it takes a lot to get it right. You could end up with a renovated home that no one wants to buy.

The Surprising Ways Self Driving Cars Will Change Our World

If self driving cars become a reality in ten or twenty years, they will change the entire real estate landscape in ways few of us can imagine.

Don't Let Your Loved One Become A Victim Of Elder Abuse

Could You Or Someone You Know Be A Victim Of Elder Abuse?Financial crimes against the elderly are nothing new. Older people are often targeted by children, close family, friends and scam artists of various types. The elderly are also vulnerable to cyber-crime, hacking and identity theft. I believe it is important to warn my readers to be aware of crimes against the elderly and convey this on to people who could be targets.A recent article I came across in the New York Times by Constance Gustke also highlights this topic. The article starts out with a story about an 84-year old woman, Maria, who was approached by a longtime friend, a younger woman, for a $500,000 loan to help get her boyfriend back on his feet. Maria decided to help because she had lent money to her young friend before and it had always been paid back. Without consulting a professional, she handed over $500,000 but never got back a cent even after a judgment against the couple! Maria now deeply regrets her generosity. At 84, she’s lost her retirement nest egg and lives near the edge of poverty. Thankfully, Maria owns her home and receives social security so she will do okay, but that’s no consolation!Maria says she treated this “friend” like a daughter. The friend, meanwhile, won her trust and said she’d always be there to take care of Maria and then, sadly, sold her out.It’s a sad story but what’s even sadder is that this is just the tip of the iceberg. Financial crimes against elders take a toll on their lives and pocketbooks every day. Sadly, trusted caregivers children, friends, and relatives are often most at fault.Older adults are vulnerable targets because they usually have a fair amount of money saved, are typically debt-free, and own their homes. As old age takes a toll on memory loss, weakened motor skills such as the inability to sign checks after a stroke, dementia, Alzheimer’s, etc., the elderly become increasingly incapable of protecting themselves against fraud and unwittingly become easy targets from people they’d never suspect—trusted friends, close family members, or caretakers who get greedy, especially when they know the elder has no recourse to anyone else for day-to-day survival.Elderly abuse has no boundaries. It happens across social strata. For example, in a recent high profile case, millionaire socialite Brooke Astor was robbed by her son, Anthony Marshall, of tens of millions of dollars after getting power of attorney over his mother’s assets.In another prominent case, noted actor Mickey Rooney was robbed by his stepson, who began draining millions from Mickey’s accounts after purchasing hydrocodone without a prescription, receiving power of attorney, and leaving the actor broke and in debt when he died. In testimony to Congress before he died, Mr. Rooney urged abused elderly people to not stay silent as he had.Track Your Money And Assets At All Times And Don’t Let your Caretaker Get The Feeling They Aren’t Being WatchedFinancial crimes experts also urge victims to speak out and contact a lawyer or their state’s Adult Protective Services agency (Florida’s APS can be found here) if they are victims of abuse or deception. They say these crimes often start small with thefts of small items like jewelry and blank checks but increase over time if the smaller crimes go undetected. Track your money and assets at all times and don’t let your caretaker get the feeling they aren’t being watched.Often, when financial abuse happens, the defrauded person is afraid of looking foolish or causing anguish in the family. Caregivers often threaten or emotionally blackmail elders aga...

Think You Can Open A Restaurant And Succeed?  Here's What It Takes

Want to open a restaurant? It’s not as easy as it looks.  Find out what it takes to get your Michelin Star.

Money-Saving Advice For First Time Home Buyers

First time home buyers often make rookie mistakes that cost them tens of thousands in extra home-related costs. Here's what you need to avoid. 

Dilbert Creator Explains Why President Trump Is A Master Persuader: Part I

Ever wonder why Trump’s slogans stick in your head while Democratic catchphrases fail to catch on?  Dilbert creator Scott Adams gives us the scoop.

Dilbert Creator Explains Why President Trump Is A Master Persuader: Part II

Ever wonder why Trump’s slogans stick in your head while Democratic catchphrases fail to catch on?  Dilbert creator Scott Adams gives us the scoop.

The New Tax Reform Plans: Who Wins, Who Loses?

The House and Senate tax reform bills create winners and losers. Will you fare better under the new plan or will your taxes get even more complex? Find out.

How Much House Can Your Money Buy?

Now that millennials are buying more homes, is housing affordability getting better or worse? And how much home can their money really buy? 

How Much Does The Twelve Days Of Christmas Actually Cost

Here are some quirky ways to follow rising costs according to the 12 Days of Christmas.

Investment Alert: Is Your Employer’s 401(k) Plan Ripping You Off?

Several companies have mismanaged employee 401(k) contributions by charging excessive fees on underperforming funds. Make sure your 401(k) is well-managed.

Everything You Need To Know Before Your First Big Art Investment: Part I

Ever wondered how to tippy-toe into the daunting world of art collecting? We’ve got the answers on what to look for and art’s suitability as an investment.

Everything You Need To Know Before Your First Big Art Investment: Part II

Ever wondered how to tippy-toe into the daunting world of art collecting? We’ve got the answers on what to look for and art’s suitability as an investment.

Homes Are More Affordable Today Than 20 Years Ago

Unbelievably, as a percentage of median home income, monthly mortgages are more affordable today than 20 years ago. So it’s still a great time to buy!

The Art Of Saving For College In 5 Steps

Saving for college begins at birth.  Here’s how you can calculate the cost of college before your child is out of diapers.

Warren Buffett's First $100 Million: The Early Successes & Failures

It wasn't all lollipops and roses in the beginning for Warren Buffett.  Glen Arnold’s new book looks into the making of his first $100 Million...a great read.

Will Tax Reform Kill America’s Housing Market?

Tax reform proposals want to do away with the mortgage interest deduction. Will this kill America’s housing market?

Turns Out Lord Voldemort Makes A Great Financial Role Model

Learn from Lord Voldemort’s single-minded, self-denying, ruthless focus on achieving his goals and why he makes a perfect if unlikely financial role model.

Worried About Getting Bumped Off Your Next Flight? Know Your Airline Passenger Rights!

Wondering what your options are if you're delayed or bumped off the plane? We've got your airline passenger rights listed here so you'll know what to do.

Great Investors Have Great Instincts

With Vitaliy Katsenelson, CEO at Investment Management Associates and author of The Little Book of Sideways Markets, and Active Value InvestingVitaliy Katsenelson is Chief Investment Officer with Investment Management Associates and a well-known author of two books, The Little Book of Sideways Markets, and Active Value Investing.  In addition, his articles have appeared in major financial magazines and journals.Vitaliy runs a blog called ContrarianEdge.com, which could give you some idea of the kind of investor he is. Conformity is not his style. In fact, he says, his style can best be described as being able to see things that others don’t; often that means doing the opposite of what the market's doing and being your own person.It’s not clairvoyanceVitaliy says that the vision of great investors has nothing to do with crystal balls but with having the right mental models; it’s the ability to see value where others don’t and following a consistent investment process time after time after time.To further explain his position, when analyzing an investment, Vitaliy asks himself these questions:Do I want to be in this business?Do I like the management?How well do they allocate capital?Do they have a process I can relate to?The contrarian way Sticking to your position, not conforming to the accepted view isn’t easy in any aspect of life. For an investor, especially operating under the pressure and responsibility of handling other people’s money, it’s especially difficult. You may know you’re right, but it takes courage to explain to your clients and get them to accept the contrarian mindset, especially when your decisions may seem wrong for a long period of time.When you have a situation where the market seems at odds with your instincts, Vitaliy follows a procedure that involves conferring with other respected investors to see all sides of the situation while figuring out what a company is worth. That takes work and a strong belief in your contrarian method.But sometimes you change direction.As committed as one may be to a credo, Vitaliy says it’s important for an investor to be able to change his mind. Using Warren Buffett (whom he greatly admires) as an example, Vitaliy states that even though Buffett has been quoted as saying he would never own an airline or a technology company, he eventually bought IBM and just recently purchased airline stock.The mark of a great investor is success and along with that is the ability “to constantly learn and then change your mind when you get an insight.” Something true of Vitaliy and all great investors.Disclosure: The opinions expressed are those of the interviewee and not necessarily United Capital.  Interviewee is not a representative of United ...

Great Investors Have Great Instincts

With Vitaliy Katsenelson, CEO at Investment Management Associates and author of The Little Book of Sideways Markets, and Active Value InvestingVitaliy Katsenelson is Chief Investment Officer with Investment Management Associates and a well-known author of two books, The Little Book of Sideways Markets, and Active Value Investing.  In addition, his articles have appeared in major financial magazines and journals.Vitaliy runs a blog called ContrarianEdge.com, which could give you some idea of the kind of investor he is. Conformity is not his style. In fact, he says, his style can best be described as being able to see things that others don’t; often that means doing the opposite of what the market's doing and being your own person.It’s not clairvoyanceVitaliy says that the vision of great investors has nothing to do with crystal balls but with having the right mental models; it’s the ability to see value where others don’t and following a consistent investment process time after time after time.To further explain his position, when analyzing an investment, Vitaliy asks himself these questions:Do I want to be in this business?Do I like the management?How well do they allocate capital?Do they have a process I can relate to?The contrarian way Sticking to your position, not conforming to the accepted view isn’t easy in any aspect of life. For an investor, especially operating under the pressure and responsibility of handling other people’s money, it’s especially difficult. You may know you’re right, but it takes courage to explain to your clients and get them to accept the contrarian mindset, especially when your decisions may seem wrong for a long period of time.When you have a situation where the market seems at odds with your instincts, Vitaliy follows a procedure that involves conferring with other respected investors to see all sides of the situation while figuring out what a company is worth. That takes work and a strong belief in your contrarian method.But sometimes you change direction.As committed as one may be to a credo, Vitaliy says it’s important for an investor to be able to change his mind. Using Warren Buffett (whom he greatly admires) as an example, Vitaliy states that even though Buffett has been quoted as saying he would never own an airline or a technology company, he eventually bought IBM and just recently purchased airline stock.The mark of a great investor is success and along with that is the ability “to constantly learn and then change your mind when you get an insight.” Something true of Vitaliy and all great investors.Disclosure: The opinions expressed are those of the interviewee and not necessarily United Capital.  Interviewee is not a representative of United ...

How Much Longer Will This Bull Market Last?

The stock market has been on a tear since March 2009. So, are stocks overvalued and due for a market correction—or are they getting ready to soar?

Disciplined Growth Strategies Of Successful Companies

Looking for a great long-term growth company to add to your portfolio? Here's how successful CEOs use disciplined growth strategies to beat the competition.

Disciplined Growth Strategies Of Unsuccessful Companies

Steve and Peter break apart unsuccessful companies to learn "what not to do" when it comes to beating the competition.

How Online Shopping Is Forever Changing Real Estate As We Know It

Are deals like Amazon and Wholefoods upending real estate as we know it? Find out how all of this will impact your real estate investments. 

The Best Times To Buy And Sell Homes

Americans are less willing to relocate for job opportunities than previous generations. Plus...what’s the best time to buy or sell a home?

You Are Your Own Biggest Motivator To Financial Success

Become your own biggest motivator for financial success. Here's how to channel your energies to save, invest, and become financially independent.

Could A Change In The Tax Code Drive Away Home Buyers?

Could the Republican’s tax code reform initiative drive away home buyers by eliminating the mortgage interest deduction?

Can You Become A Genius?

With Eric Weiner, Former NPR Foreign Correspondent, Author of The Geography of Genius: A Search for the World’s Most Creative Places. From Ancient Athens to Silicon ValleyIn discussing his latest book The Geography of Genius, geopolitical writer and foreign correspondent Eric Weiner defines genius as that person in our culture whose creativity hits a target no one else can see, thereby compelling the rest of the world to recognize and acknowledge the accomplishment, Einstein being a good example.He goes further to say that in order for these bursts of life-changing genius to occur, the cultural environment must be fertile and nurturing. He gives the analogy of a garden that needs the proper components of soil and nutrients in order to produce quality vegetables. Like the seed that flourishes in rich soil, genius occurs as a result of an idea or a discovery happening at an opportune time and place.Addressing the fact that there have been so few women geniuses, he states that women historically have been dominated and controlled by white men and therefore have not had the opportunity and the freedom to create and discover on a grand scale, dispelling the notion that genius is genetic.In addition, when the cultural environment is right, we get clusters of genius, for example, 15th century Florence which produced the original Renaissance Man, Leonardo da Vinci. The Medici and other Florentine families understood and appreciated art; they sought out great works and were generous in their patronage. The interest and the money of these families fostered a creative ecology where genius could develop and thrive.The Golden Age of Athens is another example of a fertile environment, but a completely different one from Florence. The ancient Greeks invented the symposium, a gathering place where men gathered and drank (albeit moderately) while discussing freely and without censure the great ideas that would be passed on to future generations and cultures.Somewhat like Greece, the people of Edinburgh, Scotland were able to take the ideas of others and greatly improve upon them—the steam engine being one of those massive improvements. Edinburgh, after having lost its independence to England, was a rough and difficult place to live. The Scots’ response to this intractable environment was the merging of ideas and innovation, which came to the forefront with their advancement in medicine. The Scots were masters of practical innovation.A common denominator of these genius clusters was some sort of chaos or trauma coming before. Athens had been burned to the ground; Florence had been decimated by the bubonic plague, as examples. These occurrences shook up the established social order. The chaos happens somewhere between the breaking down of the old order and the re-structuring of another, after which comes a new social order ripe for the emerging of ideas and cultural leaps.Weiner goes on to explain the genius cluster in Silicon Valley today emanating from, strangely enough, the sinking of the Titanic in 1912, after which all ships were required to have ship to shore radios on board. With a location far from the East Coast and the powerful money elite, Palo Alto, California and the area that makes up Silicon Valley had the freedom and the innovative thinking that spawned the Federal Telegraph Company, amateur radio, and other “tinkering” that led up to the tech world we live in today.To conclude,

How To Achieve Your Dreams And Take On The World

With Natalie MacNeil, Author of She Takes on the World and The Conquer Kit, Creator of SheTakesonTheWorld.comNatalie MacNeil is an entrepreneur, author, and speaker who focuses on the growing number of women starting their own businesses without an MBA or prior experience in financial or management areas. Filling that knowledge gap is what led to The Conquer Club, a 12-month business mentorship program designed to outfit these women with the skills and connections necessary to building and maintaining a successful company, and to take the steps to achieve your dreams.The value of the support system that The Conquer Club offers goes beyond the basic tenets of setting up and running the day to day operations; the value extends to showing varied perspectives from multiple points of view and experiences. For example, even the advice to hire a virtual assistant can be the impetus that allows a business to take a leap to the next level and on to greater success.On her website shetakesontheworld.com, Natalie shares many of the resources she uses in her own business—a bit like allowing a behind-the-scenes peek into how a business can change and improve along the way.While she understands the benefits of a 9-5 job, Natalie wants those women looking to transition to entrepreneurship to focus on the 5-9, by using those 3-4 hours of evening time to move the ball towards their goals, a few yards at a time.Natalie stresses the importance of doing the hard work, sticking to a plan, not giving up, and being persistent, much like with long-term investing. She also urges people to not shy away from sharing their opinions, even if that means facing criticism or creating controversy—because that’s what got her noticed.Disclosure: The opinions expressed are those of the interviewee and not necessarily United Capital.  Interviewee is not a representative of United Capital. Investing involves risk and investors should carefully consider their own investment objectives and never rely on any single chart, graph or marketing piece to make decisions.  Content provided is intended for informational purposes only, is not a recommendation to buy or sell any securities, and should not be considered tax, legal, investment advice. Please contact your tax, legal, financial professional with questions about your specific needs and circumstances.  The information contained herein was obtained from sources believed to be reliable, however their accuracy and completeness cannot be guaranteed. All data are driven from publicly available information and has not been independently verified by United Capital.

Reorganizing Your Life For Comfortable Retirement

With Donna Rosato, Senior Writer at Money MagazineAs we go through our adult lives, it’s important to periodically check our vital signs, for both our physical and our financial health.  Donna Rosato, a senior writer at Money Magazine, has the protocol for making certain that all aspects of our money life are monitored on a regular basis, thereby ensuring that we’re prepared for retirement and also for encountering those inevitable emergency situations.Donna’s recommended checklist for assessing your financial well-being includes keeping tabs on your credit score, regularly contributing to a retirement fund, and maintaining an emergency fund of about six months of living expenses for any of life’s surprises.Even though people are feeling more secure in the job market today, it’s important to be constantly on guard for potential pitfalls. For example, if you live in an area that depends on the status of one industry and that industry fails, the value in your home could be affected. Donna advises assessing risks along the way and making financial adjustments accordingly.Setting goals and making a plan to achieve those goals, whether it be a trip to Bali or paying off a student loan, is a strong motivator for success. And following through is much easier with either a visual reminder such as a picture board in your workspace or utilizing one of the tech tools which hit you with a reminder notice that it’s time to contribute to that fund—and then you have the pleasure of watching the dream incrementally materialize.Disclosure: The opinions expressed are those of the interviewee and not necessarily United Capital.  Interviewee is not a representative of United Capital. Investing involves risk and investors should carefully consider their own investment objectives and never rely on any single chart, graph or marketing piece to make decisions.  Content provided is intended for informational purposes only, is not a recommendation to buy or sell any securities, and should not be considered tax, legal, investment advice. Please contact your tax, legal, financial professional with questions about your specific needs and circumstances.  The information contained herein was obtained from sources believed to be reliable, however their accuracy and completeness cannot be guaranteed. All data are driven from publicly available information and has not been independently verified by United Capital.

How The Media Hijacks Your Mind Without You Knowing It!

Our minds are hardwired with availability bias, which can influence our investment decisions unless we consciously recognize this and step in to stop it.

How The Media Hijacks Your Mind Without You Knowing It!

Our minds are hardwired with availability bias, which can influence our investment decisions unless we consciously recognize this and step in to stop it.

Understanding Bitcoin And Its Future

Bitcoins have soared in value to about $7,000 apiece. So, would you buy some for your retirement portfolio or is it a bubble to sucker you in?

Understanding Bitcoin And Its Future

Bitcoins have soared in value to about $7,000 apiece. So, would you buy some for your retirement portfolio or is it a bubble to sucker you in?

How To Spot Elder Abuse And Prevent It

Would you recognize elder abuse if you saw it? Here's what you should do to prevent it and how to report it.  Michael Hackard has the answers.

How To Spot Elder Abuse And Prevent It

Would you recognize elder abuse if you saw it? Here's what you should do to prevent it and how to report it.  Michael Hackard has the answers.

Can Individuals With Tenacious Moral Fiber Succeed In Today's World?

How much moral fiber should companies have? Expert Shawn Vij explains why ethical business practices promote personal and professional growth.

Can Individuals With Tenacious Moral Fiber Succeed In Today's World?

How much moral fiber should companies have? Expert Shawn Vij explains why ethical business practices promote personal and professional growth.

Think Twice Before Adding Children To Your House Deed

Should adults add a child’s name to the house deed? Real Estate Round-Up has the answer, along with an update on the U.S. housing market.

Think Twice Before Adding Children To Your House Deed

Should adults add a child’s name to the house deed? Real Estate Round-Up has the answer, along with an update on the U.S. housing market.

An In-Depth Look At The Greatest Minds Of Investing

William Green discusses his new book Great Minds of Investing which offers a human look at some of the most successful iconic investors in the world.

A Great Investor's Million Dollar Secret

With Mohnish Pabrai, managing partner of Pabrai Investment FundsMohnish Pabrai, managing partner of Pabrai Investment Funds which he founded in 1999 is considered to be one of the world's greatest investors and is this week’s addition to our “Great Investor” series.Back in ‘94, Mohnish was the owner of a successful IT firm when a window opened into a new world as he began hearing and reading about Warren Buffett. He was particularly intrigued by the concept of compounding which Einstein called the “eighth wonder of the world,” leading Buffett to know early on that he would one day be rich. From there, Mohnish began his own compounding engine that eventually took him into a new direction.Wise words from Warren BuffettWarren Buffett has often been quoted as saying, "I'm a better investor because I'm a businessman, and I'm a better businessman because I'm an investor.” Mohnish took the core principle of these words and approached every buy as though he were buying either a fraction of or an entire business. Still within what he calls his learning period of the mid-90s, heheld on to the basic ideas of buying a dollar for well under a dollar and looking for businesses that were within the circle of competence.Looking for the upside without a downside.After following such great investors as Warren Buffett, Charlie Munger and others—whose style of investing went against the grain of most mutual fund investors at that time who were rapidly turning over scores of stocks with little or no regard to the intrinsic value of the businesses themselves—Mohnish set up The Pabrai Fund in 1999.Contrary to the perception of the entrepreneur as risk-taker, Mohnish is quick to point out that successful entrepreneurs try to minimize risk and instead look for a business with the lowest risk possible but one with the highest potential rewards—the upside without a downside. He mentions Richard Branson as someone who has managed spectacularly well in this regard.Lunch with WarrenIn 2007, Mohnish won the coveted bid to have lunch with Warren Buffett. During that time, Warren spoke about integrity and, in explaining his internal yardstick, he asked the question "Would you prefer to be the greatest lover in the world and known as the worst or would you prefer to be the worst lover in the world and known as the greatest?" He then said, "If you answer that correctly, then you have the right internal yardstick."The takeaway for Mohnish from that lunch was that Warren highly values both integrity and truthfulness and looks to his inner scorecard in both investing and in life. Neither Charlie Munger nor Warren Buffett pays attention to what we would consider either acceptable investments or acceptable behavior.Peter Kaufman’s 3 reasons for great successAnother of Mohnish’s influencers was Peter Kaufman who interviewed both Warren and his partner Charlie Munger for his book Poor Charlie's Almanack, in which he listed the three reasons for their success:* The willingness to be patient. Charlie Munger said they don't make money when they buy stocks, and they don't make money when they sell stocks, they make money by being patient.* Extreme decisiveness. You must be willing to bet heavily if the opportunity strikes.* Having no concern about being different from the crowd.The keys to great investingBecoming rich takes certain deliberate actions, according to Mohnish. Point by point, he advises:-begin early, in your 20s, if possible-always spend less than you earn-take advantage of tax laws, IRAs, 401ks, etc-invest in low-cost index funds“Dollar-cost average that in throughout your life,” he says, “and even at very modest annual returns and very modest savings rates,

A Great Investor's Million Dollar Secret

With Mohnish Pabrai, managing partner of Pabrai Investment FundsMohnish Pabrai, managing partner of Pabrai Investment Funds which he founded in 1999 is considered to be one of the world's greatest investors and is this week’s addition to our “Great Investor” series.Back in ‘94, Mohnish was the owner of a successful IT firm when a window opened into a new world as he began hearing and reading about Warren Buffett. He was particularly intrigued by the concept of compounding which Einstein called the “eighth wonder of the world,” leading Buffett to know early on that he would one day be rich. From there, Mohnish began his own compounding engine that eventually took him into a new direction.Wise words from Warren BuffettWarren Buffett has often been quoted as saying, "I'm a better investor because I'm a businessman, and I'm a better businessman because I'm an investor.” Mohnish took the core principle of these words and approached every buy as though he were buying either a fraction of or an entire business. Still within what he calls his learning period of the mid-90s, heheld on to the basic ideas of buying a dollar for well under a dollar and looking for businesses that were within the circle of competence.Looking for the upside without a downside.After following such great investors as Warren Buffett, Charlie Munger and others—whose style of investing went against the grain of most mutual fund investors at that time who were rapidly turning over scores of stocks with little or no regard to the intrinsic value of the businesses themselves—Mohnish set up The Pabrai Fund in 1999.Contrary to the perception of the entrepreneur as risk-taker, Mohnish is quick to point out that successful entrepreneurs try to minimize risk and instead look for a business with the lowest risk possible but one with the highest potential rewards—the upside without a downside. He mentions Richard Branson as someone who has managed spectacularly well in this regard.Lunch with WarrenIn 2007, Mohnish won the coveted bid to have lunch with Warren Buffett. During that time, Warren spoke about integrity and, in explaining his internal yardstick, he asked the question "Would you prefer to be the greatest lover in the world and known as the worst or would you prefer to be the worst lover in the world and known as the greatest?" He then said, "If you answer that correctly, then you have the right internal yardstick."The takeaway for Mohnish from that lunch was that Warren highly values both integrity and truthfulness and looks to his inner scorecard in both investing and in life. Neither Charlie Munger nor Warren Buffett pays attention to what we would consider either acceptable investments or acceptable behavior.Peter Kaufman’s 3 reasons for great successAnother of Mohnish’s influencers was Peter Kaufman who interviewed both Warren and his partner Charlie Munger for his book Poor Charlie's Almanack, in which he listed the three reasons for their success:* The willingness to be patient. Charlie Munger said they don't make money when they buy stocks, and they don't make money when they sell stocks, they make money by being patient.* Extreme decisiveness. You must be willing to bet heavily if the opportunity strikes.* Having no concern about being different from the crowd.The keys to great investingBecoming rich takes certain deliberate actions, according to Mohnish. Point by point, he advises:-begin early, in your 20s, if possible-always spend less than you earn-take advantage of tax laws, IRAs, 401ks, etc-invest in low-cost index funds“Dollar-cost average that in throughout your life,” he says, “and even at very modest annual returns and very modest savings rates,

Turns Out All Great Investors Take The Road Less Traveled

With Tom Russo, Managing Partner at Gardner Russo & GardnerAs part of our new “Great Investor Series,” this is the first “What’s in Their Wallet” segment which can also be found here.Tom Russo, Managing Partner at Gardner Russo & Gardner, a hedge fund managing about $12 billion, is a recognized thought leader in the field of investments and devotes time lecturing and educating students.Before we see what makes Tom a Great Investor, it’s interesting to hear how it all began for him, how he segued from a career in law to the world of finance as a money manager when circumstance put one of the greatest investors of all time in his path.An Early Lesson in Investing from Warren BuffettAs Tom tells it, he was a student in 1982 at Stanford’s Law and Business Graduate Program when his value investment professor brought in one of his colleagues to speak to the class—that colleague turned out to be Warren Buffett.  Where most investment conversation at the time had to do with modern portfolio theory, Tom recalls that Mr. Buffett spoke about investing in businesses as though you owned them yourself with such “clarity of thought it that parted the way for me.”At that defining moment of Tom Russo’s career, Buffett laid out a specific 3-prong analysis of what a business must possess to have a competitive advantage:* The non-taxation of unrealized gains, which requires the investor to think about businesses that have the capacity to grow, the capacity to reinvest.* Before investing, you must know that the management whom you trust to reinvest will do so with the owner’s, rather than the management’s, interest in mind.* Invest in businesses that you like because you’ll probably work harder at it and be more intuitive about it.By following these guidelines through the years, Tom says sixty-plus percent of his investments have been in family-controlled companies, which to some may imply more risk, but in actuality, there is less risk. In addition, the favored companies are ones that throw off a lot of cash, are able to reinvest that cash successfully, and have global aspirations and brand recognition.A Great Investor Knows the Difference Between Instant and Slow Roasted CoffeeTo be a smart investor, Tom advises, you must have a long-term view and the capacity to suffer; you want to invest in companies willing to make strategic moves in a timely mindful manner that will pay off in the future and one that is strong enough to keep corporate raiders from breaking through the door.It took Nestle 15 years to perfect Nespresso, the most successful premium single-portioned coffee on the market. During those developmental years of laboring over the crema, the beans, the scent, the bar pressure, the technology, and the marketing strategy, imitators rushed to the scene, pushed their products out the door, and ultimately failed. Nestle, by taking its time, did it right and launched a classy, profitable member of the Nestle Group.Stock Options: Who Wins And Who Loses?One of the reasons Tom says he’s invested so highly in internationally based companies is that they use stock options as a far smaller portion of compensation than they do in the US, where the practice of dangling stock options has actually become a destructive practice.Tom explains, “With options, you suddenly introduce into the equation of reinvestment an element called time.  Your options are good for three years, and if the price isn't $72.50 three years from now, they're worthless.  You as the manager have every ability to deliver the kind of results that Wall Street demands of you to get to $72.50 in three years, but that might actually come at the cost of the future because you may cut spending.  You may make the numbers and ruin the value of the company in ...

Turns Out All Great Investors Take The Road Less Traveled

With Tom Russo, Managing Partner at Gardner Russo & GardnerAs part of our new “Great Investor Series,” this is the first “What’s in Their Wallet” segment which can also be found here.Tom Russo, Managing Partner at Gardner Russo & Gardner, a hedge fund managing about $12 billion, is a recognized thought leader in the field of investments and devotes time lecturing and educating students.Before we see what makes Tom a Great Investor, it’s interesting to hear how it all began for him, how he segued from a career in law to the world of finance as a money manager when circumstance put one of the greatest investors of all time in his path.An Early Lesson in Investing from Warren BuffettAs Tom tells it, he was a student in 1982 at Stanford’s Law and Business Graduate Program when his value investment professor brought in one of his colleagues to speak to the class—that colleague turned out to be Warren Buffett.  Where most investment conversation at the time had to do with modern portfolio theory, Tom recalls that Mr. Buffett spoke about investing in businesses as though you owned them yourself with such “clarity of thought it that parted the way for me.”At that defining moment of Tom Russo’s career, Buffett laid out a specific 3-prong analysis of what a business must possess to have a competitive advantage:* The non-taxation of unrealized gains, which requires the investor to think about businesses that have the capacity to grow, the capacity to reinvest.* Before investing, you must know that the management whom you trust to reinvest will do so with the owner’s, rather than the management’s, interest in mind.* Invest in businesses that you like because you’ll probably work harder at it and be more intuitive about it.By following these guidelines through the years, Tom says sixty-plus percent of his investments have been in family-controlled companies, which to some may imply more risk, but in actuality, there is less risk. In addition, the favored companies are ones that throw off a lot of cash, are able to reinvest that cash successfully, and have global aspirations and brand recognition.A Great Investor Knows the Difference Between Instant and Slow Roasted CoffeeTo be a smart investor, Tom advises, you must have a long-term view and the capacity to suffer; you want to invest in companies willing to make strategic moves in a timely mindful manner that will pay off in the future and one that is strong enough to keep corporate raiders from breaking through the door.It took Nestle 15 years to perfect Nespresso, the most successful premium single-portioned coffee on the market. During those developmental years of laboring over the crema, the beans, the scent, the bar pressure, the technology, and the marketing strategy, imitators rushed to the scene, pushed their products out the door, and ultimately failed. Nestle, by taking its time, did it right and launched a classy, profitable member of the Nestle Group.Stock Options: Who Wins And Who Loses?One of the reasons Tom says he’s invested so highly in internationally based companies is that they use stock options as a far smaller portion of compensation than they do in the US, where the practice of dangling stock options has actually become a destructive practice.Tom explains, “With options, you suddenly introduce into the equation of reinvestment an element called time.  Your options are good for three years, and if the price isn't $72.50 three years from now, they're worthless.  You as the manager have every ability to deliver the kind of results that Wall Street demands of you to get to $72.50 in three years, but that might actually come at the cost of the future because you may cut spending.  You may make the numbers and ruin the value of the company in ...

Best Selling Author Nelson DeMille Explains How To Make A Blockbuster Book

There’s a lot more competition in a market influenced by Internet and smartphones. Luckily, Nelson DeMille explains how to still come out on top.

Best Selling Author Nelson DeMille Explains How To Make A Blockbuster Book

There’s a lot more competition in a market influenced by Internet and smartphones. Luckily, Nelson DeMille explains how to still come out on top.

Hiding in the Bathroom: An Introvert’s Guide To Overcoming Social Anxiety

It’s quite possible that the person enthralling everyone with a great story and amazing sales pitch is actually a silently, suffering introvert.

Hiding in the Bathroom: An Introvert’s Guide To Overcoming Social Anxiety

It’s quite possible that the person enthralling everyone with a great story and amazing sales pitch is actually a silently, suffering introvert.

What Do You Do If You Have A Bad Condo Board?

Living with a bad Condo Board? Here are your options.

What Do You Do If You Have A Bad Condo Board?

Living with a bad Condo Board? Here are your options.

New Report! Surprise Savings You Didn't Know Existed At Warehouse Clubs

Turns out Costco & BJ's offer significant savings on things other than your 15-pack of paper towels and 40 pounds of dog food. Here's the breakdown.

New Report! Surprise Savings You Didn't Know Existed At Warehouse Clubs

Turns out Costco & BJ's offer significant savings on things other than your 15-pack of paper towels and 40 pounds of dog food. Here's the breakdown.

401(k) Pros and Cons You Should Not Ignore

Tax deferred investments don’t always make sense for several reasons.  So, make sure you understand these 401(k) pros and cons before you dive in.

A Peek Inside The Wallet Of Another Great Investor

With Mohamed El-Erian, Bloomberg View columnist, Chief Economic Advisor at Allianz, and Chairman of President Obama's Global Development CouncilContinuing with our new series called “The Great Investors, What's in their Wallet?”  The Steve Pomeranz Show has invited Mohamed El-Erian, truly one of the world’s greatest investors, to speak about his personal investing practices.Mohamed is a Bloomberg View columnist, Chief Economic Advisor at Allianz, and Chairman of President Obama's Global Development Council.  In previous interviews, we discussed his latest book, The Only Game in Town: Central Banks, Instability, and Avoiding the Next Collapse, and he helped us understand and get some needed perspective on the implications of the Brexit referendum, when that was a big issue a few months ago.A Peek Inside Mohamed’s “Wallet”It may be surprising to learn that about 30% of Mohamed’s portfolio is in cash at the moment, which Mohamed acknowledges doesn’t pay him anything at all.  He states, in fact, that inflation actually eats away the real purchasing power of that cash. So how does he explain his present position?“We have been living through a very unusual period in which financial assets have been decoupled from fundamentals and for good reason.  Central banks have tried to use the financial markets as a way of promoting growth, by pushing up artificially asset prices, making people feel richer, and triggering the wealth effect, so they'd go out and spend more.  Unfortunately, it hasn't worked.”The Investor’s DefenseWith central banks becoming less effective, the smart investor responds with resilience, in case prices do go down, and with agility to take advantage of overshoots. In that vein, Mohamed says he has reduced his holdings of public equities and public bonds and moved those mostly into cash, and, in addition, has invested more actively in venture capital.Dealing With Artificially Low-Interest RatesIn spite of the fact that stock prices are high relative to other risky investments, stocks are still an attractive option, and the equity market, says Mohamed, “is the only place you can get any returns or expect to get any returns.”  In order to keep the economy moving forward, the Fed has created artificially low-interest rates, which, in turn, has produced an over-priced market. At some point, prices will go down and having cash on hand enables an investor to buy at more attractive prices when that does occur.The Illuminating Tale of the Dog and The CatTo illustrate the concept of buying in an artificially priced market, Mohamed uses the example of the dog and the cat. There's a cat that you can buy at $30,000, but there's a dog that you can buy at $10,000. How would you choose? You might say, "I'd rather buy a dog at $10,000." But, says Mohamed, “that doesn't make it a good thing to do.  It may be cheaper in relative terms, but in absolute terms it's expensive.” And not a smart investment.Choosing Your Mistakes as an InvestorConsidering the many unknowns in the marketplace, it’s not possible to cover all bases when deciding where and how to invest, and the choice of either staying out of the market and waiting it out or going “all-in” is crucial. So which way do you go? Mohamed says “it's better to recover from a mistake where you've left some money on the table than one in which you've lost quite a bit of money fast.” Venturing into the Venture SideWith the stock market having done well this year, Mohamed has offset the 0% earnings on his cash by focusing on venture capital investments. Venture capital investments are early stage, risky investments in which you get an equity stake in the business with the hope that it will give b...

A Peek Inside The Wallet Of Another Great Investor

With Mohamed El-Erian, Bloomberg View columnist, Chief Economic Advisor at Allianz, and Chairman of President Obama's Global Development CouncilContinuing with our new series called “The Great Investors, What's in their Wallet?”  The Steve Pomeranz Show has invited Mohamed El-Erian, truly one of the world’s greatest investors, to speak about his personal investing practices.Mohamed is a Bloomberg View columnist, Chief Economic Advisor at Allianz, and Chairman of President Obama's Global Development Council.  In previous interviews, we discussed his latest book, The Only Game in Town: Central Banks, Instability, and Avoiding the Next Collapse, and he helped us understand and get some needed perspective on the implications of the Brexit referendum, when that was a big issue a few months ago.A Peek Inside Mohamed’s “Wallet”It may be surprising to learn that about 30% of Mohamed’s portfolio is in cash at the moment, which Mohamed acknowledges doesn’t pay him anything at all.  He states, in fact, that inflation actually eats away the real purchasing power of that cash. So how does he explain his present position?“We have been living through a very unusual period in which financial assets have been decoupled from fundamentals and for good reason.  Central banks have tried to use the financial markets as a way of promoting growth, by pushing up artificially asset prices, making people feel richer, and triggering the wealth effect, so they'd go out and spend more.  Unfortunately, it hasn't worked.”The Investor’s DefenseWith central banks becoming less effective, the smart investor responds with resilience, in case prices do go down, and with agility to take advantage of overshoots. In that vein, Mohamed says he has reduced his holdings of public equities and public bonds and moved those mostly into cash, and, in addition, has invested more actively in venture capital.Dealing With Artificially Low-Interest RatesIn spite of the fact that stock prices are high relative to other risky investments, stocks are still an attractive option, and the equity market, says Mohamed, “is the only place you can get any returns or expect to get any returns.”  In order to keep the economy moving forward, the Fed has created artificially low-interest rates, which, in turn, has produced an over-priced market. At some point, prices will go down and having cash on hand enables an investor to buy at more attractive prices when that does occur.The Illuminating Tale of the Dog and The CatTo illustrate the concept of buying in an artificially priced market, Mohamed uses the example of the dog and the cat. There's a cat that you can buy at $30,000, but there's a dog that you can buy at $10,000. How would you choose? You might say, "I'd rather buy a dog at $10,000." But, says Mohamed, “that doesn't make it a good thing to do.  It may be cheaper in relative terms, but in absolute terms it's expensive.” And not a smart investment.Choosing Your Mistakes as an InvestorConsidering the many unknowns in the marketplace, it’s not possible to cover all bases when deciding where and how to invest, and the choice of either staying out of the market and waiting it out or going “all-in” is crucial. So which way do you go? Mohamed says “it's better to recover from a mistake where you've left some money on the table than one in which you've lost quite a bit of money fast.” Venturing into the Venture SideWith the stock market having done well this year, Mohamed has offset the 0% earnings on his cash by focusing on venture capital investments. Venture capital investments are early stage, risky investments in which you get an equity stake in the business with the hope that it will give b...

Improve Your Financial Life In Just 3 Weeks

Want to improve your financial life fast? Christine Benz has made complicated easy with this 21-day challenge. So why don't you start right now?

Improve Your Financial Life In Just 3 Weeks

Want to improve your financial life fast? Christine Benz has made complicated easy with this 21-day challenge. So why don't you start right now?

Achieve Your Dreams In Retirement With Unretirement

Unretirement is about leading a full life in retirement, maximizing your potential, and achieving your dreams. It's so good, it's almost too good to be true.

Sports & Stocks: When Winning Is Everything

Ever wonder what sports and stocks have in common? Here's how to apply winning sports strategies to your investment efforts.

Sports & Stocks: When Winning Is Everything

Ever wonder what sports and stocks have in common? Here's how to apply winning sports strategies to your investment efforts.

Are Bitcoins Really Worth Anything Or Just A Bubble Waiting To Burst?

Bitcoin has soared in value since its debut five years ago.  Are Bitcoins really worth the digits they're "printed" on?

Are Bitcoins Really Worth Anything Or Just A Bubble Waiting To Burst?

Bitcoin has soared in value since its debut five years ago.  Are Bitcoins really worth the digits they're "printed" on?

The Grey Nomad: Surviving As A Low Income Senior

The 2008 housing and market crashes hit many US seniors especially hard. Here's how it's affected their retirement income.

How To Retire Well

First rule in how to retire? Plan for the unplanned so there's no surprises.

Hot Off The Press! The First 2018 Housing Outlook

Freddie Mac’s 2018 housing outlook predicts a rise in new home inventory, higher mortgage interest rates and a modest increase in home prices.

Should You Be A Copycat Investor?

Piggyback investing alongside your investment gurus is easy to do but in no way guarantees that those very same investments will perform as well for you.

10 Best & Worst College Majors For A Lucrative Career

The best college majors could pay as much as $3.4 million more in lifetime earnings than the worst college majors.

The Kardashians: An American Drama

Jerry Oppenheimer’s new book, The Kardashians: An American Drama, reveals some interesting facts about their rise to the top you may not have known...

Calling All Small Investors! Here’s A Guide Just For You

Small investors can reap sizable investment gains, even on relatively small portfolios, if they take advantage of low cost ways to grow their money.

Home Prices Have Been Up Every Month, But Where’s The Inventory?

Home prices have risen every month for the past 66 months but tight inventory continues to hold down home sales.

Irma's Economic Impact Could Be 200% More Than Katrina

Hurricane Irma’s economic impact could be as much as $190 billion, 200 percent more than Katrina’s costs, because of Florida’s rapidly growing population.

The Woman Who Smashed Codes:The Unlikely Heroine Who Outwitted America's Enemies

In his novel, The Woman Who Smashed Codes, Jason Fagone shines a light on unsung heroine, Elizebeth Friedman, and her pioneering work in cryptography.

Boston Globe's Black Mass Journalist Tackles A Glaring Injustice In His New Novel, Trell

Dick Lehr’s new novel, Trell, is inspired by the true story of a young man's false imprisonment for murder and those who fought to free him.

Trump Tax Plan: Long On Promises, Short On Details

Trump tax plan lowers tax brackets but is woefully short on details. Here's what we've put together so far.

Yes, Florida Home Sales Are Rising After Hurricane Irma

Floridians appear to have stepped up home selling activity in the aftermath of Hurricane Irma. Plus, Terry’s advice on roof re-inspections after a storm.

Fake Financial News Or Trusted Source? Know The Difference

The ease of putting up a blog or an investment research website has spawned an industry of fake financial news. Make sure you're not its next victim.

How To Protect Yourself After The Massive Equifax Data Breach

Your personal data was almost certainly compromised in the Equifax data breach, so check if you’ve been impacted and take steps to protect your credit.

The Memo You May Have Missed: John Hope Bryant's Five Rules For Financial Freedom

In his new book, The Memo: Five Rules for Your Economic Liberation, John Hope Bryant lays out five rules for achieving financial freedom.

Purge Before You Splurge (On A New House)

Getting a start on a new house can also mean getting a fresh start with your stuff... Here's what needs to go.

How To Return To Work As A New Mother Successfully

With Cheryl Casone, reporter and anchor for Fox Business Network, Author of The Comeback: How Today's Moms Reenter the Workplace SuccessfullyThe stay at home mom is a dinosaur from days long gone. Whether from economic necessity or desire, most moms today are either already out in the workforce or they’re returning after time out to raise children.  Recognizing that reentry after a long hiatus from earning a paycheck can be an intimidating venture, Cheryl Casone, reporter and anchor for Fox Business Network, wrote a book on the subject called The Comeback: How Today's Moms Reenter the Workplace Successfully. Cheryl herself grew up with a working mom which she says was her inspiration for living her own life and for mentoring other women who may be agonizing over the guilt of leaving their children coupled with the insecurity of going back into an arena where the rules have changed.The two biggest concerns women have about the return to work after having children, says Cheryl are: The kids will suffer; I won’t have anything to offer; my skills are rusty or out of date.”To counter these fears, Cheryl points to a recent Harvard University study that interviewed both mothers and daughters of over 50,000 women in 25 countries and concluded that daughters, in particular—but sons as well—were more successful and reported higher levels of work/life balance than children raised by mothers who never worked. This cultural shift is light years away from the days of Leave it to Beaver.In researching her book, Cheryl interviewed over 100 women many of whose stories are cited in the book as supporting testimony for the findings from the Harvard study.Acknowledging the obstacles facing many women wanting to return to the business world, Cheryl offers invaluable advice on how to navigate back to a satisfactory position in the workplace.* Before leaving your present job, she counsels, always secure contact information for your colleagues, so you can keep in touch from home.* Social media means you never have to be in isolation. The world is right there on your screen, so maintain those contacts during your time off from work. Also, reach out for actual face-to-face meet ups with local colleagues.* Acknowledge that after being at home for a while, you might have to accept less money or a different title.* Building a resume is a key factor in presenting yourself as a prospective employee.  Cheryl’s advice is to emphasize your strong points at the top of the page, front and center, and to not minimize some of the skills you’ve used at home, such as negotiating, multi-tasking, and organizing.The Comeback: How Today's Moms Reenter the Workplace Successfully is a self-help book that will coach you back into the workplace. Cheryl gives you advice, resources, and courage to go confidently into the arena of the successful working mom.Disclosure: The opinions expressed are those of the interviewee and not necessarily United Capital.  Interviewee is not a representative of United Capital.

Naked Retirement: Prepare To Bare It all In Your Golden Years

In Naked Retirement, Robert Laura shows people how to lead fulfilled lives in retirement by being financially, emotionally, and professionally prepared.

Your Kids Want Your Money: Will Giving It To Them Put Your Future In Jeopardy?

Most parents want to help with their children’s financial needs, but juggling their requests with your retirement demands will take some financial finesse. 

Buyer Beware: Flipped Homes Could Be A Real Nightmare If You're Not Careful

Be careful buying flipped homes because "Home Flippers" have little motivation to take care of the property and may not be around if you have problems later.

Hurricane Season Got You Down? Get Back Up With These Disaster Survival Tips

Hurricane fatigue? Here's some disaster survival tips to help you get it together without too much headache.

Norm Champ Goes Public With His Adventures Inside The SEC – Post Madoff

In his book, Going Public: My Adventures Inside the SEC and How to Prevent the Next Devastating Crisis, Norm Champ discusses what he learned during his SEC tenure.

Number Crunchers Unite! We Need You More Than Ever

WSJ's Greg Ip bravely defends Economists in his article, “In Defense of the Dismal Science", while Steve praises all "bean-counters" who search for truth in numbers. 

Number Crunchers Unite! We Need You More Than Ever (Part II)

WSJ's Greg Ip bravely defends Economists in his article, “In Defense of the Dismal Science", while Steve praises all "bean-counters" who search for truth in numbers. 

Tiny Homes: Big Hope Or Big Hype?

Tiny homes are big in the news, but before you commit, consider zoning laws, insurance and mortgage options, resale values, and your long-term needs.

401(k) Pros and Cons You Should Not Ignore

Tax deferred investments don’t always make sense for several reasons.  So, make sure you understand these 401(k) pros and cons before you dive in.

Lessons From Game Of Thrones And The Power Of Money

Here are the most important financial lessons from Game of Thrones—from power shifts to warring families, to winning strategies for your portfolio.

Structured Settlements Are For Suckers

Should you be wary of structured settlements? This expert says you should be afraid, very afraid...

Be Alert! Hackers Are Stealing Millions From Buyers By Using These Real Estate Scams

With hackers getting busier, bolder, and smarter by the minute, protect yourself from potentially disastrous real estate scams in this age of digital money.

Divorce Planning: Why Divvying Up Financial Assets Is No Cake Walk

with Matthew Lundy, Esq., Certified Divorce Financial AnalystDivorce Planning For Financial AssetsMatthew L. Lundy, Esq. and his law firm specialize in handling domestic relations and family law litigation, along with divorce planning and estate planning. He has developed a reputation as a young lawyer with a special skill for handling complicated legal issues. Matthew has been honored as a "Rising Star" by Super Lawyers Magazine and as an “Outstanding Young Lawyer” by the American Registry.Matt has seen a lot of complicated cases and has helped many deserving individuals get their fair share in retirement. He also addresses the impact of market fluctuations on retirement portfolio values and how a couple should navigate the complicated finances behind divorce.  He sheds light on the complexities behind retirement accounts and offers divorce planning tips on how to divide assets, especially equity assets, so you don’t lose out by having to sell when the market is down.Qualified Domestic Relations OrderMatt explains his specialty, the QDRO, Qualified Domestic Relations Order, a term that often comes up in divorce cases and is a court order that essentially divides up retirement plans for couples going through divorce. Plans include any retirement and pension plans set up by employers in the private sector under the Employee Retirement Income Security Act of 1974 (ERISA).He says QDROs are complicated because the subject matter of retirement plans is complicated and goes beyond what most people need to know on a routine basis, which is how much they have in the plan, what their holdings are, and a few trading basics.  In divorce planning, you have to get very specific about what the plan is and how it's being divided.  It’s not as easy as a simple “divide by two” because it depends on the securities you hold in the plan.  He cites the example of a checking account, where the cash value does not fluctuate if you make no transactions, so that is easy to divide.  But when a retirement account has a collection of fairly complicated investments—with stocks, options, mutual funds, ETFs, bonds, etc.—values can sharply change within a few hours/days/weeks, so categorizing what is in the portfolio and determining how and when it should be divided is no straightforward task.Matt’s Most Interesting Case—The Uncompromising PilotOn Steve’s prompting, Matt says he has seen a lot of interesting cases in divorce planning, in the context of family law.One case that stands out for him, very early in his career, is where a woman with two children was getting a divorce. Her husband, who was a pilot and made about $200,000 a year, refused to pay any child support or alimony.  He wouldn't even pay for the house and, basically, abandoned everybody and left.The woman was in dire need of money when she came to Matt’s law firm.  They went straight to court.  On hearing her case, the judge was absolutely irate with her husband for his behavior and wanted to throw him in jail.Rather than have him thrown in jail, however, Matt and his team asked the judge to enter a QDRO for the entire balance of the husband’s 401(k), which was about $400,000.  The judge agreed and took the entire account and assigned it to her.  Essentially, what they did was use the QDRO as an enforcement mechanism for a non-compliant person.Everyone Loses With A Shrinking PortfolioNext, Steve wonders what happens when a plan’s assets shrink over the course of a year, say from $500,000 to $250,000.  Matt says those are classified as passive gains and losses based on market fluctuations, and each party eats half the loss.Within the purview of divorce planning, he also talks about the more complicated division of Defined Benefit Plans that factor in issues such as the income stream, periodic cost-of-living adjustments,

Want To Quit Your Job NOW? Consider These 8 Affordable Places To Live

If quitting your job and living abroad sounds appealing, check out this list of the 8 most affordable places to live outside the U.S.

Liberate Your College Savings With A 529 Plan

To make the most of a tax-advantaged, college savings 529 Plan, front-load investments, minimize fees and penalties, add beneficiaries, and avoid taxes.

The Gender Pay Gap Is Real! Here's How To Handle It Like A Pro

In today’s world, it’s best to be upfront about money issues early in a relationship and openly address gender pay gap issues in the workplace.

The Fun Way To Help Your Kids Become Successful Entrepreneurs

JJ Ramberg explains how to help your kids become successful entrepreneurs and give them "a leg up" in business & life.

Have You Been A Victim Of Home Buyer's Remorse?

Make sure you’re not a victim of home buyer’s remorse by thoroughly checking out the home and making sure the neighborhood fits your lifestyle and needs.

Turns Out Lord Voldemort Makes A Great Financial Role Model

Learn from Lord Voldemort’s single-minded, self-denying, ruthless focus on achieving his goals and why he makes a perfect if unlikely financial role model.

Looking For Financial Success? Follow These Simple Steps

You too can become a financial success if you put your mind to it. Just follow a few simple steps and stick with the program. It’s easier than you think!

2017 Stock Market Outlook: A Mid-Year Analysis

BlackRock sees low economic volatility & strong global growth in its 2017 stock market outlook. Conclusion: Stick with stocks for now & consider investing abroad.

Lower Your Interest Rate On College Debt With A ‘Student Loan Cash Out Refinance' Program

Fannie Mae’s new "student loan cash out refinance" program makes it easier to pay off student loans at a lower interest rate by refinancing your mortgage.

Smart Money's New Wave: Smart Beta ETFs

Smart Beta ETFs are growing at twice the rate of index ETFs and are poised to become the next big innovation in asset management. Here’s how.

Worried About Getting Bumped Off Your Next Flight? Know Your Airline Passenger Rights!

Wondering what your options are if you're delayed or bumped off the plane? We've got your airline passenger rights listed here so you'll know what to do.

Bag The Top Cash Back Credit Cards And Earn Free Money

Check out Kiplinger’s best cash back cards to see how you can earn the most free money from your everyday credit card purchases.

Think Outside The Box To Win In Today’s Tight Housing Market

Frustrated by the competition in today’s tight housing market? See how you can get creative and make your offer stand out.

The New Love Deal: What You Must Know Before Marrying, Moving In, And Moving On

Afraid of discussing finances with your partner? Dive into “The New Love Deal” and have one less thing to stress about in your relationship.

What To Do If Your Neighbor's Airbnb Starts Spinning Out Of Control

What do you do if the Airbnb guests start jumping off the roof into the pool and start strewing beer cans and trash all over the yard?

Confessions Of A Recovering Car Dealer

You’re no match for the slick car dealer. Level the playing field and get the inside scoop on how to get the best deal for the car you want.

Are You A Shopaholic? Know The Signs, Break The Habit

Retail therapy: It feels so good, but it’s a habit that can destroy your financial health. Here's everything you need to know about being a shopaholic.

Cuba Rising: The Journey From Poverty To Plenty

See Cuba from the eyes of this Cuban-born US politician, as he takes us though the beginning stages of Cuba's great awakening.

4 Tips To Buy Stocks Low

Steve shows you the tried-and-true methods to buy stocks low in the style of Warren Buffett.

How To Build Wealth Through Investing And Become The Invisible Millionaire Next Door

Believe it or not, all you need to build wealth through investing is a steady job, the right mindset, and some discipline.

5 Parallels Between Poker And Investing

While gambling in the stock market is often disastrous, even Warren Buffett knows when to hold them and when to fold them.

Predict And Profit From Demographic Shifts

Turns out you can predict the next big trend and profit from demographic shifts. This expert tells us how.  (Hint: It's almost too easy)...

America’s Affordable Housing Crisis Just Got Worse In 2017

Recent data showed a 7% drop in homes for sale at $100,000 or below, underscoring a worsening of America’s affordable housing crisis.  

Amazon To Buy Whole Foods: Now That's Food For Thought!

By now you've heard the headlines "Amazon To Buy Whole Foods". We look at what the future of shopping may look like.

Understanding The Great Depression May Explain Trump's Impact

Understanding the Great Depression provides valuable insights on whether Trump’s America First stance might cause economic turmoil in the years ahead.

Will The 2017 Market Rally Continue Through The Rest Of The Year?

We're in the second longest bull market since World War II.  Many fear that this sustained 2017 market rally could end soon, so we took an in-depth look.

It’s a Seller’s Market for Now, But Things Could "Flip"

We are in a seller’s market now, subject to change over the next few years.  Here's a look at when things might flip over to a buyer’s market.

Keys To Success For A Life Of Passion And Purpose

These techniques can lead to a more productive personal and professional life. The keys to success are as relevant for men as they are for women.

What America's $1.4 Trillion Student Loan Crisis Means To You

America faces a student loan crisis, with $1.4 trillion in outstanding educational loans. Here's what you can do to tame the beast.

Congress Is Going To Change The Affordable Care Act.  Are You Ready?

Republicans have vowed to make changes to the Affordable Care Act. Here's how their key provisions will impact Americans of all ages.

How To Think About Money: Here's A Blueprint For Your Financial Affairs

Jonathan Clements discusses his latest book, How to Think About Money, focusing on harmonizing all aspects of your personal finances.

Increase In Fannie Mae's Debt To Income Ceiling Should Make Your Next House Easier To Buy

Fannie Mae raised its debt to income ceiling which might boost affordability and home purchases in this hot housing market.

Do I Have Enough For Retirement?

As Bob Dylan, our recent surprise Nobel Laureate once said famously in song… “the times, they are a ‘changin…”There was a time when working hard and following the rules almost certainly guaranteed a comfortable retirement, but that very American dream of a blissful retirement, free of financial worries, appears to be slipping away for more and more Americans—especially those who “don’t follow the rules.” What I mean by “rules” are simple things such as making a budget, managing expenses, consistent saving and investing, keeping track of your job-related benefits, and sticking to your plan.Do I have enough for retirement?Today, most U.S. households are heading for a worse lifestyle and quality of life in retirement than they enjoyed while they were working, despite bringing in reasonably good paychecks, and this is—woefully—because they simply aren't saving enough. Thirty-five percent of U.S. households in their prime earning years have nothing saved in a retirement account and no access to a traditional pension plan, according to an analysis from the Federal Reserve.Among households that do have some savings, the typical amount is $73,200; that's about 15 months of the median household's income. The only group that doesn't have to worry as much are the richest 10% of households that have more than $400,000 in retirement accounts.The low retirement balances mean the majority of households — 52% — are at risk of having to cut their spending after entering retirement.Make a retirement plan and stick to it.So, for most Americans, things don’t look that good, which is a pity because I believe the American Dream is still achievable by most Americans if they just get their basic financial planning in order and stick diligently to a plan. And let me add this: I’ve been a practicing financial advisor for 35 years, and I have seen many success stories—people with modest jobs and paychecks who, through wise financial planning early in life, conservative spending, and prudent investing are now millionaires.These people are positioned to live a rich lifestyle in retirement, free of financial worry, with tremendous peace of mind, and more money in the bank than they’ll likely need. That’s what I want for all of you. So, you see, the problem isn’t that Americans aren’t making enough; it’s that they aren’t being diligent enough about retirement savings.In light of our recent election, let me also say that this retirement anxiety stretches across political affiliations. Nearly equal percentages of Democrats and Republicans say they're not managing their retirement planning very well.It’s not your fault, but it is your responsibility.That said, the fault doesn’t wholly lie with American taxpayers. This looming retirement crisis is also the result of a system that has increasingly put workers in charge of saving for and managing their own retirements. Data shows that the top 10% of U.S. households made more than $162,000 last year—up 6% from a decade earlier, after adjusting for inflation. For middle-class Americans, incomes have barely stayed ahead of inflation, while lower-income households are now making less than they were a decade ago.With traditional pensions plans increasingly becoming extinct, it's even more important for Americans to save on their own. Meanwhile, Social Security—the last line of defense for many people’s retirement plans—is barely going to be enough to support you as you age.To help close the gap, states are trying their own measures. California recently passed a law requiring employers to automatically enroll their workers in a state-run retirement savings program by deducting money from each paycheck, and early results are very encouraging.The bottom line is the onus still lies on you. Making these important changes in your financial life can make all this retirement pain avoidable.

Yes…Luxury Investments Are Losing Their Luster

The economy is firing on all cylinders, but why are luxury investments fading? Here's how the decline will affect you even if you're not invested.

How Bettin' On The Ponies Equates To Successful Investing

Here's how investors can boost their successful investing returns by studying what it takes to win at the racetrack. 

How Technology Has Impacted The Music Business

Technology has impacted the music business in almost every aspect. Here's how new artists can still break through and make a name for themselves.

What Seniors Must Know About Long Term Care

There’s a 70% chance that someone over the age of 65 will need some form of home care but it doesn’t come cheap. Here's how to budget for it just in case.

Why Are Millennials Buying Homes Rather Than Renting Them?

Recent data shows that millennials are buying homes at twice the rate than they are renting, suggesting they're finally getting into the housing market.

How To Use Dividend Investing As A Key Strategy For Success

Cash flow investing is an integral strategy of the value investing philosophy. Dr. Gary Smith shows us how to create a Dividend Investing "Money Machine".

How Will Eliminating The Property Tax Deduction Affect You?

Terry and Steve discuss possible changes coming from the Trump administration on federal income tax deductions for property taxes.

Is Your Emergency Savings Fund Big Enough?

Learn the nuances of having just the right amount in your emergency fund. 

Divorce, Scandal, And The Road Financial Recovery

Married to a husband jailed for fraud, Author Janet Lombardi details her fall and triumphant rise to financial recovery. 

Great Investor Charlie Dreifus Rocks Small-Caps Like Nobody's Business

Great Investor Charlie Dreifus goes deep with Steve about opportunities in small companies. 

Everything You Need To Know About Signing Up For Medicare

Navigating the maze of signing up for Medicare can be confusing and fraught with costly mistakes. Here's what you need to know to get it right.

It's Hurricane Season Again! Do You Have The Right Insurance?

We certainly don't want you to be caught out in the storm. Make sure your home is properly insured against natural disasters.

Part 1 Exclusive With Great Investor Mohnish Pabrai

As part of our “Great Investors” series, standout Mohnish Pabrai joins Steve to talk about Warren Buffett, tech stocks, and stock prices in Q2 2017.

Will Our Shopping Malls Disappear Forever?

Are shopping malls in economic free-fall and doomed long term? Here's a close look at the pressure online shopping is putting on brick and mortar retailers.

Part 2 Exclusive With Great Investor Mohnish Pabrai

Part 2 of our “Great Investors” series, standout Mohnish Pabrai joins Steve to talk about Warren Buffett, tech stocks, and stock prices in Q2 2017.

How To Get A Great Deal On A New Car

While going toe-to-toe with a car salesman is still the way most car deals are negotiated, online tools are empowering consumers and changing the game.

The Stress Of Moving Is Keeping People At Home

Moving is so stressful that it's actually having a negative impact on the housing market. Plus tips for buyers in a tight market and more...

Don't Make These 3 Common Retirement Mistakes

Retirement planning is fraught with the potential for costly mistakes. Here are 3 of the biggest. Be careful out there!  

An In Depth Look At The Greatest Minds Of Investing

William Green discusses his new book Great Minds of Investing which offers a human look at some of the most successful iconic investors in the world.

Introducing Three Of Wall Street's Hottest Market Indicators

With Turney Duff, Author of The Buy Side: A Wall Street Trader’s Tale of Spectacular Excess, Contributor to Showtime's Billions and CNBC’s The Filthy Rich GuideTurney Duff, Survivor Of Wall Street ExcessIf you’re looking for an eyewitness account of the wild rides, Dionysian excesses, trophy and status seeking, and the fortunes made and lost on Wall Street over the past couple of decades, Turney Duff might be your man. As a trader at major hedge funds, he participated in the decadent boom times and bloody busts and lived to tell the tale in his 2013 book The Buy Side: A Wall Street Trader’s Tale of Spectacular Excess.  He also has consulted for the Showtime hit Billions, is a regular on CNBC’s The Filthy Rich Guide, is a frequent article contributor to many financial websites, a blogger on his site TurneyDuff.com, and has enjoyed a host of other accolades.  He joins Steve to talk about the culture of “The Street” and its seeming lack of all limits on ostentatious and hedonistic behavior during bull markets as well as his own story of getting in over his head with the temptations he found while raking in a high 6-figure salary.Is The 2017 Stock Rally Feeding A Spend Big Culture On Wall Street?The high-octane stock market rally that’s been in the driver’s seat since the November election has no doubt created a lot of wealth—at least on paper— and 2017 bonuses for fund managers and traders are on track to rain a lot more money on “The Street.”  Steve asks Duff whether he’s currently seeing the kind of flashy, risk-taking exuberance that marked the go-go years of the late ‘90s and mid-2000s, pre-crisis.  Duff replies that he’s not seeing the same levels of decadence that he witnessed and joined in during those earlier bull runs.  He does admit, however, that many of the men on Wall Street he knows seem to be breaking in the direction of “increasing their deviant factor,” but he’s not convinced that “we’re heading back to where it was.”  The feedback he’s gotten from many friends and acquaintances about a recent article he wrote on the dawning of a new extravagance on Wall Street has been critical of his thesis, arguing that there’s no such thing.  Nevertheless, Duff sees evidence that a lot of big money players are ramping up their spending on “extracurriculars,” even as many others are holding back and keeping a lower profile.Conflict Of Money-Shaming Vs The Reemergence Of Wealth-FlauntingSteve floats an explanation for the relative reticence of bankers and financial pros. After the financial market meltdown in 2008, the culture on Wall Street became much more conservative for a number of reasons: Obama’s election signaled that new regulations of the industry were on the way, bonuses were slashed, thousands were laid off, public sentiment was in a nasty mood towards the nation’s financiers, and countless people and companies had been burned by the stock and housing markets.  Duff agrees, noting that when he asked his Wall Street contacts before the most recent market rally, as recently as October 2016, a majority were in savings mode and reluctant to use expense accounts.  He believes the reason is that people have not felt financially safe since the crisis, even as markets have steadily overcome their losses.  The trauma of seeing homes and stocks lose over 50% of their value has left a mark that will endure, even on younger generations who weren’t directly affected.  Duff sees a fair amount of “wealth-shaming” going on by the public, a persistent hangover from the crisis that is perhaps concentrated in the notion of the 1% vs the 99%.  Steve finds the phrase “wealth-shaming” a helpful barometer of larger scale changes in the culture.  Until recently, the very rich have kept their spending relatively in check and discrete, but Trump has arguably ushered a new cycle of unashamed,

Is The One You Love Cheating On You Financially?

Financial infidelity can destroy relationships. Make sure you have shared goals and always keep the lines of communication open.

Low Housing Inventory Is Frustrating Would Be Buyers

Low-housing inventory is frustrating buyers and exacerbating market deadlock. Is this why rents are so high?

What? $650 Million's Not Enough For Johnny Depp?

Although Johnny Depp is worth a lot of money, he's got himself into a heap of trouble and there are lessons here for all of us.

Managing Your Money To Create A New Life After Divorce

Divorce can be a rough road but the future can be bright if you make the right moves now.

Just How Much Is Enough For Your Emergency Cash Fund?

Having an emergency cash fund is important but knowing where to stash it matters too. 

Best Credit Cards For College Grads?  It's Time To Learn The Game

Wondering about the best credit cards for college students and college grads? Here are the best choices to make money and build credit.

Looking For A Retreat? How About Vero Beach?

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLVero Beach Offers Quiet Retreat From Busy South FloridaOn the docket today Steve and Terry chat about the quiet beach town of Vero Beach, Florida, issues that frequently come up with flipped properties, renter fees versus deposits, and landlord's insurance.  Vero Beach is an hour north of South Florida, and in many ways offers a contrast to the hectic pace and crowds found in the urban/suburban sprawl that stretches from Palm Beach to Miami.  Terry describes Vero Beach as a very nice community, quieter and more seasonal than South Florida, and one where nobody lives more than 15 minutes from the beach.  Many people from Fort Lauderdale and surrounding towns drive up to Vero Beach for a leisurely retreat from the hustle and bustle.One difference South Floridians will notice right away is how much easier it is to get access to the beach in Vero Beach.  The area also contains abundant natural beauty, from the coast to the Indian River “lagoon” which the Intracoastal Waterway flows through.  Other perks include numerous restaurants and golf courses.  The luxury community of John Island offers a more exclusive experience for those who can afford it.Vero Beach Real Estate And Median Home PricesTerry notes that the median home price in Vero Beach is about $188,000 or $132 per square foot, quite a bit cheaper than what you'll find further south.  There are many single-family homes listing in the 250-350 thousand range.  New residential construction has picked up after a long period of inactivity.  Like South Florida and other areas in and out of state, the Vero Beach area is no longer seeing foreclosures and short sales.  Steve asks whether there's been growth in median home prices, and Terry confirms that prices are up in Vero Beach as in most of the state to the tune of around 10% annually for the last several years.  The relatively low, affordable median home prices offer a clue as to how far they fell during the mortgage crisis.  The long and slow recovery from a deep bottom may suggest there is more opportunity for price gains in Vero Beach than in other cities in South Florida.Buyer Beware When It Comes To Purchasing A Flipped HomeThe conversation turns to the hot real estate market and the resurgence of home flipping.  Steve asks Terry to talk about some of the potential legal complications of buying a flipped property.  She replies that it’s crucial to understand who the actual seller is—is it a bank or an investor, and do they have the legal title yet?  This scenario usually follows from a foreclosure.  Another murky situation can come up when a homeowner has passed away and left their home to an heir.  Sometimes the heir doesn't have the title before they sell it to an investor or an investor buys such a property but then has to wait a certain period of time before they can legally re-sell it.  This may mean that as a purchaser you have to have two appraisals done before you can buy it.  The bottom line is that you need to know who the seller is and be on the lookout for issues that can arise with a flipped property.Steve recalls that during the height of the housing bubble, he saw home flippers buying homes but not closing on them before re-selling them.  Terry says she saw some of that back in the mid-2000s but hasn't seen it lately.  What she has seen a lot of recently are investors buying a home, fixing it up, and then having to wait 120 days or so to sell it.Flipping Houses Not As Easy As It Looks And Many Do It BadlyFlipping houses might seem exciting and easy and better than working a regular job, Steve comments, but the reality is that nothing easy is going to offer a path to success. It's imperative to treat property flipping like you would any business or investment,

The Grey Nomads: Surviving As Low Income Seniors

The 2008 housing and market crashes hit US seniors especially hard. Here's how it's affecting retirement income.

Here's What You Missed At The Berkshire Hathaway Meeting

What's the latest on Berkshire and the legendary Warren Buffett?  Technology stocks, missed Amazon opportunities, the hush around Wells Fargo, and much more.

Retirement Withdrawal Strategies To Make Your Money Last

When it comes time to living off your savings, what is the ideal retirement withdrawal rate to cope with market volatility and changing spending needs?

What Exactly Is Up With Interest Rates These Days?

We explore why interest rates are so low and the best savings account rates being offered today.

Home Sales And Prices Spring Forward

Terry Story digs into the numbers along with what's hot and what's not in home features and styles. Turns out man caves are so last year.

Manage Your Finances Successfully Like A Great Chief Financial Officer

Just as businesses must be managed to be successful, you can manage your finances to ensure stability and wealth for you and your family.

How To Find Work After Retirement: Job Search Strategies For Retirees

Finding a job as you approach retirement can be difficult.  Here are some valuable strategies to help you find work after retirement.

Why Investing In Art Is Like Playing For The NBA

Investing in art can add value to your assets, especially in a diversified investment portfolio.  But buyer beware...

Overcoming Divorce And Emerging Stronger

With Angie Hallier, Certified Family Law Specialist, Author – The Wiser DivorceStrategies for Less Painful & Expensive DivorcesIn The Wiser Divorce, Angie Hallier, a family law attorney for over 20 years, shares strategies she’s honed for her clients to help them find less complex, drawn out, expensive, and painful paths through divorce and out to the other side.  These include lessons on keeping your emotions in check and compartmentalized from the legal process, putting children first and collaborating with your spouse on childcare, finding the right attorney, prioritizing goals and desired outcomes, avoiding unnecessarily high financial costs, and considering a settlement in lieu of a divorce ruling, among others.  She suggests approaching divorce like you would starting a small business and makes the analogy believable.  By following her recommendations, you’ll have a better chance of emerging post-divorce with a positive attitude, your children’s welfare intact, and your financial house in order, ready for exciting opportunities in what Hallier calls your “Next Best Life.”Ditch the drama and forget the blame game, to loosely paraphrase Hallier’s advice. Divorce is commonly—and with good reason—thought of as a major life crisis, but being prepared and mindful of potentially better resolutions can make the difference between flailing through it bitterly, dragging the family along with you, and accruing heavy legal fees versus working effectively with a lawyer to reach a speedy settlement or court-ordered decree while keeping your children protected from the conflict. The Wiser Divorce features realistic strategies, positive solutions, and even worksheets that can help heal a broken family and help you grow personally.Divorce as a Battleground and a Gradual Shift to New ParadigmsSteve begins the conversation by asking Hallier how divorce came to be seen as a winner-takes-all legal battle and wonders if that perception is finally beginning to change.  Hallier argues that this idea of divorce as battlefield is a myth, albeit one based in the long-standing practice of approaching divorce as a lawsuit in which one spouse sues the other.  This leads to a majority of cases going to court, a process steered by attorneys who believe that you have to go to court to discover the facts of a case and get them in front of a judge.  Nowadays, Hallier maintains, there are many more ways that people can go about ending the legal contract of marriage that don’t require courts and judges’ decrees.  She elaborates on this by explaining that there is no “supreme commander of justice” in family law courts that will render judgments that make everything fair, validating the fundamental goodness and rightness of one party against the other.  Judges are ordinary people who are overworked and jaded from years of being on the receiving end of countless emotional appeals to justify one party and resolve every detail in the cases they oversee.  Even though they may seem sympathetic to a petitioner, they’ll never be able to render the kind of decree that many spouses want, especially considering that they’ll only spend a few hours on the case.  They are also restrained by the law as to what they can or can’t order.  Understanding the reality of a judge’s limitations can be transformational to the extent that people realize they aren’t going to get everything they want in the judicial outcome. This can open their minds to far less expensive and time-consum...

How To Guarantee A Return On Your Home Improvement Investment

Selling your home? These home improvement projects will add the most value to your property.

How Much Life Insurance Do You Really Need?

Life Insurance for the Attention Span ChallengedToday I want to help you understand a topic that many may find a little bit morbid, dull, and baffling: Life Insurance. Okay, before you zone out, you should know that, short of dying rich, life insurance is probably the best way to take care of your loved ones after you're gone.Most of us are naturally reluctant contemplating our own death or the demise of our loved ones, but for the sake of your family and your peace of mind, you need to overcome this aversion and face up to it.Okay, so I'm not going to try to convince you that the subject is fun, but I would argue that it's not as hopelessly confusing as you might think it is.  I'm going to try to walk you through it in simple and practical terms.If this in any way sounds like a sales pitch, it’s not and I don't think everyone needs life insurance.But the question is: Do You Need Life Insurance?Well, who needs life insurance and who doesn’t? This answer is easy: if you have dependents—children, a spouse—or if you don't have adequate savings or other assets, life insurance can replace your lost income if you die.  If you want to provide them with a similar lifestyle to the one they're accustomed to, life insurance can fill this role in your financial plan. By lifestyle, I mean annual income to cover recurring costs like rent, food, and bills but might also include major one-off expenses like college tuition or a new car, for example.Basic Options in Life InsuranceOn to the thornier part of the life insurance puzzle: what kind of life insurance makes the most sense in your case?  There are two basic categories: term life and permanent life policies. Permanent Life goes by many names: Cash-Value, Whole, Universal, Variable, to name a few.They are permanent because, unlike term life which covers a fixed number of years, permanent policies are structured to last a lifetime.I’ve promised to spare you from drowning in a sea of details, so I want to narrow these down to a basic choice between term life and whole life insurance.  If your goal is to protect your family for very long periods of time or to substitute for a closing of your business or to pay for estate taxes after your death, you'll want to look into whole life or universal insurance. If you are primarily concerned with protecting your family from the loss of income that would result from your death, during your working years, a term life policy makes more sense and is significantly easier to pay because the premiums are much lower.How Much Life Insurance Do You Need?Let's turn to the question of how much insurance you need.  Some advisors throw out a generic recommendation of 5, 10, or 20 times your annual salary, but you'd be well served to look closer at your finances and your family's particular needs before deciding on an amount.For starters, add up all your unpaid debts, your mortgages, your credit cards, your loans as those will be directly deducted from the insurance proceeds.  If you think you’re going to add on more debt over time, you’ll want to buy more insurance to cover it.The next factor—in some ways the heart of the issue—is replacing the loss of income that you're no longer providing for your family.  What will happen is that the insurance proceeds will be invested in assets that will generate some income for your dependents to live on and also cover future one-off obligations like college tuition.  At this point, you probably want to err on the side of a slightly more generous level of income to guard again inflation.Figuring out how much the insurance payout must be to generate enough income is tricky because of the volatile nature of investments.  In order to arrive at the size of the insurance payout you need, you have to make a reasonable assumption about the average annual ...

Did You Get The Memo On Money And Financial Empowerment?

John Hope Bryant talks about how his new book The Memo and his mission to spread financial empowerment to all those in need.

Turns Out Marijuana Stocks Are Starting To Look Like Real Investments

The Wolf of Weed Street talks with Steve about recent changes in state laws governing cannabis and how to approach investing in this still nascent industry.

What To Do When Your HOA Goes Rogue!

Terry says that the presidents of HOAs can’t just tweak the rules to suit themselves. Here's what to do if they do.

Having The Money Talk With Your Adult Children

When's a good time to have the money talk with adult children?  How should aging and health be factored into this discussion?  Find out here.

Stock Market Bubble 2017: Is The Stock Market In A Bubble?

Is the stock market in a bubble in 2017? Explore different ways to define and spot bubbles and reach your own conclusions.

Can You Pass This Money Quiz?

Think you know a lot about money? The results of this 6 question Money Quiz might shock you.

People Say "Invest For The Long Term" But Just How Long Is That?

“Invest for the long term” is common advice, but how long is long term? Here's what you need to know about returns and why patience is so critical.

Next Time, Give a Gift Card Of Stock Instead

Stockpile.com offers gift cards for buying stocks. CEO Avi Lele joins Steve to talk about the the benefits of his platform and the gift of giving stocks.

What Do Bankruptcy And Your IRS Refund Have In Common?

They both occur in the same month. Are they related...? 

Gucci: An Epic Family Legend Unmasked

An exclusive interview with heir Patricia Gucci on success, romance, secrets, and the ultimate betrayal that tore apart the Gucci legacy.

6 Steps To Get “Super Rich” From A Man Who Went From Broke To Millions

Grant Cardone offers six steps to get “super rich.” Learn how to become a millionaire from a man who went from broke to wealthy.

Every Stock Market Rally Climbs A "Wall Of Worry" And This Time Is No Different

Although there have always been good reasons to sell your stocks, over the long term it probably would have been a mistake.

How To Take Your Business Into The Big Leagues

What do Garth Brooks, baseball, and great businesses have in common? Find out why baseball is the best metaphor for business success.

The Home Affordability Crisis: Are You Being Priced Out Of The Real Estate Market?

Now that housing markets have become less affordable in 25% of the country, where can you go to still be able to afford the house of your dreams?

Here's A Secret: Sometimes An Average Return Is Excellent

As a financial advisor, I am constantly regaled by stories of the big stock winners of the day. The so-called ten-baggers, which is a term coined by the legendary Fidelity Fund manager, Peter Lynch, who would talk about those stocks that went up 10 fold. But today​ I want to make the case against reaching for the stars and just make the case to you to reach​ for mediocrity in your investments.No one ever talks about the merits of reaching for mediocrity, but I am going to, so please stay with me on this.I plan to use some data in my commentary today that came from Craig Israelsen who wrote an article titled “Are Average Returns Enough for Clients?” for Financial-Planning.com.In his article, Craig compares annual returns from the S&P 500 index versus a portfolio of seven other different types of assets. We call these assets “asset classes” and they consist of large-cap U.S. stocks, small-cap U.S. stocks, international stocks, commodities, real estate, U.S. bonds, and cash. To further my reaching for mediocrity, I’ll call this the “Average Portfolio.” The author looked at what may have happened if one invested an equal amount in each class over a 44-year period from 1970 to 2013 and compared it to the S&P 500 index, which, as you probably know, is comprised of 500 large U.S. companies. Remember that the S&P 500 is a cap-weighted, unmanaged index made up of stocks​ only.The data Craig presented in the article showed that annual returns from the S&P 500 were better than the Average Portfolio 55%​ of the time,​ doing better in 24 of the 44 years. And sometimes the S&P 500 was way ahead of the Average Portfolio, like in 1998, for example, it beat the Average Portfolio by about 27.5%. And furthermore, over the 24 years that the S&P was ahead, it beat the Average Portfolio by an average of 8.3% per year—a pretty massive margin.But here’s the key. Despite those 24 years of solid outperformance, the two portfolios delivered about the same average annual returns over the 44-year period, with the S&P up 10.4% annually and the Average Portfolio up 10.3%.So what gives? How’s this possible?Turns out, the S&P had nine losing years while the Average Portfolio had five losing years—not much there to explain the strange performance. Looking a little deeper, we find the answer not in the frequency of the declines, but in the magnitude of the declines. You see, the losing years for the S&P 500 were dramatically worse. The S&P 500 average decline was 15.2% versus only 8.7% for the Average Portfolio—that 6.5% average disparity is what makes all the difference.Most of us would likely jump to the conclusion that 24 up​​years with an average outperformance of 8.3% would easily beat 9 down ​​years of 6.5% annual underperformance, but compounding works a little differently because negative returns damage a portfolio way more disproportionately than positive returns. And here’s a simple example:If you start with a hundred dollars and lose 50%, you’re down to $50. But to get back to $100, you need a gain of $50.  Earning $50 bucks on $50 bucks requires a 100% gain to make up for a 50% loss, so negative gains are much harder to dig out of. Do you see what I mean?Even though the S&P 500 frequently outperformed the Average Portfolio, those gains were largely undermined by the four extra down years and the extra depths of those down years. Investors should also understand that an Average Portfolio will probably never outperform a single sector, in any given year—it’s one reason so many people have trouble sticking with an asset allocated portfolio. It’s much easier and more fun to chase popular stocks that are going up right now. It really feels like you are onto something when you start to make money this way....

El-Erian On The End of New Normal: Part 2

With Mohammed El-Erian, Chief Economic Advisor at Allianz SC, Chairman of President's Global Development CouncilFederal Reserve Normalizing in 2017?Shifting gears to interest rates and the Federal Reserve, Steve raises the possibility that, in addition to its announcing two more rate hikes for 2017, the Fed is also signaling its readiness to unwind its balance sheet by selling some of the $1.7 trillion in mortgages and $2.5 trillion in Treasury securities that it purchased to stabilize the financial system in the aftermath of the global market crash in 2008.  Steve wonders whether this action would bring the market and the economy “back to reality”?  El-Erian thinks that the Fed wants to move away from being “the only game in town” in terms of supporting markets and that the relatively healthy state of the economy at the moment offers them “a window for it to start its normalization process.” This normalization includes easing measures to keep interest rates extremely low and getting out of the business of buying securities, upending policies which the Fed has been committed to for the past nearly nine years. El-Erian also remarks that he expects “at least” two more rate hikes this year, suggesting that he wouldn't be surprised by further increases.So what does this mean for markets?  El-Erian says there will be less support in terms of cheap money (i.e.rates and liquidity) but that markets are reassured by the fact that the Fed wants to exit or normalize in a very orderly fashion. There's no market panic yet because markets still believe that the Fed will have their back if needed.  El-Erian expects higher market volatility for 2017/2018 as central banks in the US, Japan, and Europe withdraw support from buoyant markets. He contends that this situation relates back to his belief that the three elements of the “New Normal”—which have aided a muted growth/low volatility scenario—are at risk of breaking down. At this point, we're either going to pivot to high or low growth, not stay on the same unsustainable course. One facet of this impending change is that politics in Europe are especially uncertain and this is already affecting economies in the form of BREXIT, with the possibility of further European Union defections to come.Foreign Markets Outperform US Stocks in 2017Steve points out that foreign markets have been performing better than domestic in the past couple of months and asks El-Erian why that is.  He answers that it’s primarily because of rotation and lag: rotation meaning that investors are seeking other sectors that have not been as overbought as US equities and lag essentially being another way of saying the same thing—foreign markets were left behind in the initial run up in stock prices after the US election.  Financials and industrials were the first to gain from the “Trump effect.” Other domestic sectors like tech followed and, soon after, so did foreign and emerging markets, which continue to be seen by many as underpriced even though they have risen sharply, while the US equities have gone flat. Emerging market sovereigns are also better prepared for a Fed interest rate hike than many US companies, thanks to reductions in their debt and increases in dollar reserves over the past several years. That said, it's still important to look at countries individually.  In El-Erian's estimation, if you buy into the US stock market today, it's because you expect Trump and Congress to deliver growth policies.Steve observes that yields on longer-term Treasuries recently declined after a brief rise, indicating that buyers are still pouring in (demand for bonds raises their prices and lowers their yield).  Short-term yields, meanwhile, have risen on the back of increases in the Fed Funds rate. This reduction in the spread between long-term and short-term yields is called a “flattening yield c...

How Carl Icahn Made A Fortune From The Rubble Of The Las Vegas Fountainebleau

With Josh Beroukhim, Full-time real estate investor & owner of Bridge Properties, Founder of BehindtheDeals.comTurnberry's Ill-fated Fontainebleau Hotel DevelopmentJosh Beroukhim publishes articles analyzing and drawing lessons from high-profile real estate deals on his website behindthedeals.com.  He joins Steve to talk about a recent piece he wrote on the Fontainebleau Las Vegas, a hotel which the development firm Turnberry Associates nearly completed in 2009, only to have the project stopped cold and the company bankrupted when its lender, Bank of America, called in its nearly $3 billion loan.The story begins with Turnberry's purchase in 2005 of the iconic Fontainebleau Hotel in Miami Beach. The company's plan was to make $1 billion in renovations to the Miami Beach property and simultaneously build a 4000 room sister hotel in Las Vegas.  The Fontainebleau Las Vegas hotel broke ground in 2007 and just two years later, with the property 70% complete and more than $2 billion dollars spent on building costs and improvements, the project came to a crashing halt.  With about $800 million left to complete the hotel and the real estate and financial sectors in free fall, BoA decided to kill the remainder of its loan to Turnberry.  What happened next, when Turnberry found itself in Miami Bankruptcy Court, is where the deal that Beroukhim's analysis keys in on is first struck.Icahn Buys The Fontainebleau Las Vegas Out Of BankruptcyIn bankruptcy court, Turnberry was forced to sell the Fontainebleau Las Vegas to the highest bidder. While there was a lot of interest in this opportunity, in the end only three bids were submitted, and the only one of those which qualified was hostile takeover legend Carl Icahn's offer of $150 million. Just on the cost of the lot itself, Carl Icahn scored big, paying only $6 million an acre for primetime land that Turnberry had paid $34 million an acre for.  Considering how much money Turnberry and Bank of America had sunk into the hotel, the discount Icahn scored was obviously deep, but Beroukhim lays out the nuts and bolts of the deal's value.Fast forward momentarily to 2016 when Icahn hired a brokerage firm to list the still unfinished hotel at $650 million—which observers believed he would get, plus or minus 5%—to get a glimpse of the windfall involved.  Backtracking, Steve asks Josh whether Icahn had plans improve or finish the hotel and then resell it. His answer is that, from the beginning, Icahn's plan seemed to be to hold onto the property in its unfinished state and sell it when the market improved.  In fact, he went even further than that, auctioning off all the furniture, mattresses, beds, wallpaper, and carpets for about $5 million, pennies on the dollar deals for its buyers. Steve observes that this looks like it was taken from the playbook of Icahn's infamous corporate raiding years, buying distressed companies and stripping their assets and selling the remains.  In this case, Icahn clearly had no interest in owning Las Vegas real estate or operating a hotel.Breaking Down the Deal, Icahn Wins BigSo far, the salient details of the deal are that Icahn paid $150 million for the property, sold $5 million worth of furniture, and is going to sell it for around $650 million, but Steve asks Josh to walk him through his analysis and break the numbers down further.  For starters, Beroukhim responds, there were acquisition costs of about $2.5 million for due diligence costs, closing costs, and legal fees.  The annual “carrying costs”—unavoidable expenses like property taxes, insurance, and maintenance—Josh calculates at $5 million/year, which comes out to around $35 million for the 7-year duration that Icahn has owned the property.  There was also a one-time cost of $1 million to cover the building in a special ta...

Worried About Thin Credit? Get Back On The Grid!

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLBuilding Materials and Other Costs of Home Building RiseSteve starts off today's segment with Terry Story by talking about reports which implore new home buyers to “Act Now before prices go up!” Terry says she just heard about these warnings recently and discovered that they are related to a 25% increase in the cost of building materials over the past year.  It turns out that lumber is in short supply due to a breakdown in a trade agreement between the US and Canada.  But that's not the only factor driving new home building costs up.  There has also been a tightening in the labor market, which is pushing wages up for construction and trades workers.  Moreover, developed lots are disappearing and the cost of land is going up in many locales.  All of these forces are conspiring to make new home building significantly pricier.Mortgage Rates Rising or Holding Steady?Many potential home buyers are also anxious about mortgage rates, wondering whether their rise will perhaps put their dreams of home ownership out of reach.  But Steve and Terry have good news on this front: they believe mortgage rates probably will not go up very much in the next couple years.  Steve points out that it's difficult to predict where interest rates are going.  The Federal Reserve manipulates the overnight Fed Funds rate to steer inflation, credit markets, and the economy, and in the last decade, they have been attempting to prop up markets and the economy by maintaining extremely low rates. The Fed Funds rate has risen by 0.25 points three times in the past year and a half, and the Fed itself has indicated it will hike target rates two more times by the same amount this year.Mortgages are actually tied to the 10-year Treasury note, which fluctuates based on a number of factors, most importantly inflation expectations. Buyers will want a higher yield if they anticipate inflation, which eats away at that yield.  Ten-year Treasury yields have not moved up despite the increase in the Fed Funds rate, thus neither have mortgage rates. Steve argues that, as a potential home buyer, instead of following the Fed Funds rate, what you want to watch out for as the economy heats up are signs of inflation in other areas besides housing prices.  That will signal impending rises in 10-year note yields and mortgage rates.  It helps put things into perspective to remember that it wasn't so long ago—in the 1990s—that mortgage rates were around 7%, and this was considered affordable, which it was, at least in comparison to the double-digit rates in the 1980s.  Rates today have a very long way to go before brushing up against 7%, which would require far higher inflation than we've seen in decades.Thin Credit? Get Back On the Grid!People who pay for everything with cash are at a major disadvantage when it comes to getting a bank mortgage. Banks make loans based on borrowers' credit history, which helps determine lending rates and other parameters of those loans. Those folks who refuse to use credit cards or other forms of borrowed (and re-paid) money are essentially invisible—“off the grid” as Steve puts it—and therefore are unknown risks to lenders. Most banks will simply balk at offering mortgages to thin-credit individuals.  The irony is that many thin-credit individuals are probably in healthy financial shape and may be more responsible than others when it comes to managing their money.Breaking out from thin-credit status to become someone whom lenders would be willing to work with is not terribly complicated.  Opening credit cards and establishing a track record of both using and paying them down can provide a fairly quick fix. But even folks who can't abide the idea of credit cards have options: paying and documenting rent and other bills and ...

10 Tricks To Appear Smart In Meetings

With Sarah Cooper, author of “100 Tricks to Appear Smart in Meetings”, Founder of thecooperreview.comCorporate Defector Drops Out To Follow Her DreamsSarah Cooper is a former Google employee turned comedienne and author. She writes hilarious business satire on her website The Cooper Review online and has recently published her first book 100 Tricks to Appear Smart in Meetings. Steve asks Sarah to talk about her decision to leave Google to pursue an uncertain dream of becoming a comic writer. She remembers a quote that affected her which said that if you haven't done something you want to do by the time you're 40, you probably won't do it. As someone approaching her 40s, this “scared the hell out of her,” crystallizing the idea that she shouldn't put her dreams off indefinitely, even as everyone around her thought she was throwing away a golden opportunity to work at one of the best companies in the world. The decision was hard because she liked her job and appreciated the benefits and safety that went along with it and also because she couldn't convince her husband, family, and friends that it was a good, and on some level, a necessary move. In the end, she decided it would be riskier to her happiness and future to stick with her cozy Google career than it would be to start over as an unknown writer.10 Tricks To Appear Smart At MeetingsKnowing this little bit of background, it's clear from even a passing glance at The Cooper Review that Sarah has mined a lot of source material on the modern workplace from her time at Google and other jobs. The motto of The Cooper Review is “funny because it's true.” Her work skewers—in a light-hearted way— corporate cultures based on endless meetings and reliance on jargon and a certain amount of posturing and bluffing to impress one's peers and bosses. Her piece entitled “10 Tricks to Appear Smart at Meetings” is a good and very funny example of her style and target selection. The inspiration for this post comes from her observations of the absurd things people in meetings say and do to make it seem like they know what they are talking about even though they've barely been paying attention at all. The first item in this list is drawing a Venn Diagram. Seemingly out of nowhere, someone volunteers to make a quick presentation of an idea using a Venn Diagram. What Sarah noticed was a Venn Diagram Effect where other meeting attendees suddenly came to life and started making suggestions about the size of the circles, colors and labels used any time a Venn Diagram was thrown up on a whiteboard, even when it made little sense or added nothing to the conversation. Her advice: draw some kind of Venn Diagram, note a burst of chiming in from colleagues, then “slink back to your chair and continue playing Candy Crush”. This one came from a personal experience where a colleague drew a blatantly terrible Venn Diagram and instead of getting clowned by others in the meeting, everyone reacted as if he had done something very smart.The second tongue-in-cheek recommendation is to fool people into thinking you're a quick study by pointlessly converting percentages into fractions. When someone mentions a statistic (“33% of users liked feature X”) retort with a deadpan “so you're saying that 1 in 3 users likes the feature.” Apparently, this passes for a display of sharp math skills in certain interactions. Of course, it's just another kind of smokescreen for the would-be sneaky converter's lack of engagement and inability to add anything of value.Suggestion #3 is to encourage everyone to “take a step back.” This one comes in handy when you realize your co-workers are throwing out ideas and comments and you don't have any of your own to contribute. Stopping the meeting with this invitation to “take a step back”,

Real Estate Prices Are Higher Because Of Millennials Buying Homes

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLConsumer Confidence In Housing Market Terry and Steve cover a slew of topics on today's show including consumer confidence in the housing market, millennials buying first homes in greater numbers, and possible parallels between the housing and stock markets. Consumer confidence in the housing market hit an all-time high in February 2017, and Terry breaks down what that means for home prices and buyers and sellers. Millennials Buying Homes One of the main effects of this consumer exuberance is that people are more apt to make bigger purchases like buying a home. There are other trends playing into that confidence and pushing home prices higher including an expectation of rising interest rates and a surge in millennials buying their first homes. Millennials are moving out of their parents' homes in record numbers, creating a wave of new household formations. Terry remarks that rising interest rates should cool down home price appreciation, preventing a replay of the early 2000s housing bubble. Steve cautions that there may be some parallels between the current stock market and the housing market, namely that prices are very high. Buying stocks or a home near a market peak entails a risk that prices could drop modestly or even significantly below peak levelsReturn Of The Flippers Another sign of a healthy or, at least, an energetic housing market is the fact that house flipping has been getting more popular in recent years, albeit still below levels seen in the mid-2000s. Terry notes that today's flippers no longer reap the same upside that access to foreclosures and short sales—so ubiquitous in the late 2000s/early 2010s—provided. Terry mentions that she hasn't had a single foreclosure or short sale in the past two years. Nevertheless, quite a few flippers are still doing well even in a picked-over market, with home prices at a median of $192K and gross profits near $62K. Other flippers have fallen victim to underestimating the costs of buying and selling and making repairs to the property while overestimating the price it might sell for.Buying A Flipped Home: What To Watch Out For Terry has some advice for homebuyers considering purchasing a home owned by a flipper. Before making an offer, you need to first come to terms with the possibility that the owner has taken shortcuts in the remodeling/repair process. Because flippers focus on cleaning up and enhancing the cosmetic things that buyers notice first, it may not be obvious right away that other, more important and expensive items have been neglected. Terry recommends looking behind doors and opening up drawers to find out what condition the cabinetry and other hardware are really in. Of course, the inspection process is supposed to flag these and other bigger ticket problems like roofs and electrical panels. The inspection results will provide ammunition for negotiating on the home price, but sometimes it helps to go straight to the permits which were pulled by the owner for repairs. Your inspector might provide these, but you can also go yourself to City Hall and check the permits to see if they were properly handled.

The Easy Way To Invest Like A Legend

With John Reese, Founder – Validea.com, Author – The Guru Investor: How to Beat the Market Using History’s Best Investment StrategiesJohn Reese holds a Harvard MBA and a Computer Science degree from MIT and is the Founder of Validea.com, a website that aggregates the investing strategies of Wall Street legends such as Peter Lynch, Ken Fischer, Warren Buffett, Marty Zweig, Joel Greenblatt, and others, providing deep strategy, portfolio, and individual stock analysis, among other research tools. You can find out more about Reese's actively managed ETF, an unusual hybrid fund, which blends 10 strategies from 10 different “Wall Street legends” on http://www.valideafunds.com.Some of John’s goals for Validea are to help make the strategies and historical track records of some of the most successful professional investors usable and understandable to individual investors; to offer strategic frameworks that help investors overcome the emotions and biases that lead to abandoning and switching strategies; and to offer an ETF—named Validea Market Legends ETF—based on his custom software which executes a set of rules based closely on the books written by these investing gurus which determines criteria for stock evaluation, selection, and portfolio management.Asked to tell the backstory of Validea, Reese starts by talking about his early efforts at MIT's artificial intelligence lab to extract wisdom from books and create programs that could then do things by following rules and instructions derived from these books. Many years later, after getting burned in the stock market and deciding to broaden his education about investing, Reese came across Peter Lynch's book One Up on Wall Street. Because Lynch's track record of out-performing the market and competitors was so well established and because the book was exceptionally clear in detailing the methods he utilized in his mutual fund (the most successful one of his era) Reese decided to revisit his AI experiments and find out if he could translate Lynch's advice into algorithms that a computer could follow.  Encouraged by the success of this project, he decided to move on to books by other famous investors: first Benjamin Graham's Intelligent Investor, then to others like Warren Buffett, Ken Fisher, Marty Zweig, and more.  With Graham's book, Reese was able to integrate a database of 6000 stocks and write programs which would scan through all this historic data to find out where they met the strategies' criteria.Steve wonders how Reese is able to distill and replicate the strategies of some of these legends who did not write with as much painstaking organization as Graham and Lynch. Reese says the main thing is that he carefully reads the books by these gurus over and over again until he understands exactly what they mean, and how they execute their process. It's not always easy, Reese admits. Sometimes they're just not clear enough to reduce to a rule, as would be the case if, say, they recommend buying a low price/earning stock. A simplistic statement like this involves too many unknown variables, for instance, do you calculate earnings based on past or future performance? Reese gets his code to replicate the exact method and criteria of the investment strategy as closely as possible,

Is A Trust Right For You?

With Eleanor Blayney, CFP Board, Directions for Women, Author – Women’s WorthIn her book,  Women’s Worth, Eleanor Blayney, author and Consumer Advocate for the Certified Financial Planner Board of Standards, breaks through the traditionally male-dominated field of financial advice to offer insights and information that women can use to make the most of their financial lives. Her approach blends practical advice with easy-to-do exercises that will help you understand your beliefs about money, learn the fundamentals of financial planning, and gain confidence in your financial know-how.Today, however, Eleanor joins The Steve Pomeranz Show to talk about trusts and their benefits. In introducing Eleanor, Steve notes that one of the most common questions he's asked is whether one should set up a trust for themselves and their assets. Is a trust the best way to pass money onto the next generation or to take care of the financial needs of someone else? Many of these same folks also have the impression that trusts are only relevant to the rich. Eleanor argues against this stereotype, asserting that trusts aren’t just for the wealthy, but may also be a good option for anyone with an “interesting” or perhaps “complicated” life. In situations where someone has been married more than once, for example, or has children with multiple partners, setting up a trust can ensure that more complicated directives on leaving specific assets to specific beneficiaries meeting specific conditions are followed.Steve asks Eleanor whether there is a simple test to determine whether a trust would be suitable for you and your estate. Her answer is that it comes back to the complexity of how you want your estate parceled up and distributed. Time is also a factor as well, how long you want your assets to last, which we discuss at the end of this summary. The more you find yourself wanting to add more detailed instructions about particular assets and beneficiaries—placing “if, and, or but” conditions on gifts to be bequeathed—the more you should consider a trust as the most reliable way to accomplish that.Trusts come in two main types: irrevocable and revocable. Revocable trusts can be updated and assets added, subtracted or redirected anytime the trustor wants. (The trustor is the person who set up the trust who is also often the trustee until incapacity or death.) These are sometimes called “living trusts.” Provisions are frequently included that provide directions for what to do when the trustor becomes incapacitated or is otherwise unable to perform these duties.  In most cases, the trust becomes irrevocable after the death of the trustor/trustee, meaning that no new assets or instructions can be added to it.One of the main reasons for setting up trusts is to avoid probate, a court-supervised process of interpreting a will and instructing an executor on how to distribute assets. Trusts are private affairs handled by trustees, while probate entails the creation of a public record. This can have various negative effects, including inciting family members or others to contest the will or merely to stir up jealousy and resentment.There are other specialized types of trusts that can be set up to define the terms of passing on assets to certain individuals. One of these is a “special needs” trust. This is designed to provide long-term care for children that parents believe will not be able to achieve financial independence.

Buy High, Sell Low: How To Go Broke By Following The Crowd

Buy High, Sell Low, Repeat until BrokeOne of the most reliable ways to lose your shirt in the stock market is to buy high, sell low, rinse and repeat. After a while: Presto! No more shirt!  Of course, no one puts their hard-earned cash into the market intending to follow this formula for disaster, but a disturbingly large number of people do it anyway. Why is this money-shredding pattern so common?  How is it that timing market trends is so difficult? The simple truth is that markets and investors are susceptible to the twin engines of greed and fear that drive short-term crowd psychology and thus stock prices. Trying to play catch up to rising stock prices or cutting losses after their decline are recipes for poor results. Buying a ticket right at the beginning of a long ride up or stepping off just before it plummets back to earth requires superhuman foresight—or, more likely, very lucky and unrepeatable timing.Efficient Markets or Crowds Animated by Greed and Fear?Efficient market theory claims that markets gather all available information about every company in the stock market—including their future earnings—and then “price in” this information in close to real time. Stock prices are said to reflect this collective knowledge, the unseen hand of the “efficient market.” The efficient market is supposed to reduce the number of “mispriced” stocks which would present long (buy) or short (sell) opportunities. But one person's “efficient market” is another person's “crowd,” and crowds are notoriously fickle, ruled by greed and fear, and prone to a dangerous, over-reactive herd mentality. Aligning stock picks with a supposedly efficient market by trying to spot stocks that have recently risen and then riding those stocks' coattails is another way of expressing a “follow the crowd” approach. We know from countless market casualties, large and small, that following the crowd as an investment philosophy is a dubious proposition.  In fact, while it sometimes works in the short run, in the long run, it's a terrific way to go broke. Impulsiveness, lack of discipline, and financial illiteracy all conspire to make following the crowd an exercise in wishful and usually very expensive thinking.Forever Playing Catch UpMany investors think they are being smart by not trying to second-guess experts or the recent direction of the market—most often during a bull run. But the reality is that they are still greedily chasing after price gains that have already happened and literally passing them by. Playing catch up in this way is very often disappointing. In many cases, it becomes clear in hindsight that a large portion of a stock's gains comes shortly after its last bottom, meaning that later investors reap less upside. If you're late to the game, you stand to gain less than early birds, and you're taking on more risk. Greed's rewards are watered down. Some pursue “momentum” stocks—stocks of companies that have shown strong growth in recent months or years.  The problem is that no one knows for sure if that momentum will continue with further price gains in the short term or how large those might be. If anything, the market is usually ahead of itself, factoring in expectations of future earnings gains. What this means is that the current price already reflects what the stock will be worth at some point in the future—if everything goes well and nothing surprising happens (good luck with that).  Again, chances are that you've probably missed the price appreciation driven by expectations of future profits. Not only is your upside limited, but if those expectations of earnings growth don't come to fruition, you will be left holding the bag. The timing could go either way in these scenarios. For this reason, any honest market veteran will tell you that timing is a fool's errand.Fear and Capitulation On the fear side of the equation,

What Makes This One-Cent Magenta Stamp Worth $9.5 Million?

With James Barron, New York Times reporter and author of The One-Cent Magenta: Inside the Quest to Own the Most Valuable Stamp in the WorldThe One-Cent Magenta: Where It All BeganVeteran New York Times columnist and author James Barron has published a book entitled The One-Cent Magenta: Inside the Quest to Own the Most Valuable Stamp in the World. The story about how a rather plain magenta stamp issued in the 1850s came to be sold in 2014 for $9.5 million dollars is surprisingly entertaining in its twists and turns and edifying in its illumination of the obsession with rarity and its acquisition within the universe of serious and rich collectors. Barron describes how he first heard of the the One-Cent Magenta at a cocktail party where he bumped into an auctioneer he knew. He had written earlier stories of other famous sales of rare items that this auctioneer had made, e.g., copies of the Declaration of Independence and the Magna Carta and one of the pianos from the movie Casablanca. This auctioneer mentioned that he hoped to sell the stamp for $10 million but was worried that a group of collectors in London might destroy the stamp by trying to ascertain its authenticity using a benzene solution. At this point, Barron was already convinced that there was a great story to tell. (The benzene tangent, by the way, turned out to be a red herring. Stamps these days are authenticated through some expensive forensic gadgetry.)The story begins in British Guiana in the 1850s when a local postmaster found himself out of stamps and had to go to the town newspaper to print off a quick batch of stamps so that the postal system could carry on. Several hundred one-cent stamps and a lesser number of four centers were printed. The one-cent stamps were immediately used to send out newspapers, presumably to subscribers outside the range of the paper's army of paperboys. The stamps were immediately forgotten about until 16 years later, when a 12-year-old stamp collector in the throes of adolescent philately found a stash of stamped letters in his deceased uncle's home. There was one rather homely and smudged stamp on a newspaper that was not interesting enough to keep him from trading it for other stamps from London. As Barron puts it, this was the worst stamp deal ever. What would become the holy grail of stamp collecting, the One-Cent Magenta, a dream to countless future philatelists, was pawned off for a few shilling’s worth of ephemera.Once There Were TwoAfter a brief digression on extremely rare and expensive American coins and stamps such as the Inverted Jenny, we pick up the story again with a wealthy collector named Arthur Hine who acquired the One-Cent Magenta at some point in the 1920s. He had spent around a million dollars (a fantastic sum in pre-depression dollars) building his stamp collection. Another collector contacted him claiming to have another One-Cent Magenta stamp and offering Hine the opportunity to buy this only copy in existence. As the story goes, Hine invited this seller to his home, where they examined the two stamps side-by-side. Even though there were slight differences—mainly in the size of the initials written on the face of the stamp—Hine was sufficiently convinced that he agreed to buy this other One-Cent Magenta. While the two men were about to enjoy post-sale celebratory cigars, Hine set the stamp he'd just bought on fire. He now had the only One-Cent Magenta in the known world. While Hine may have merely thought  he was preserving the value of his only-one-in-the-world stamp by burning the other, his action might represent the psychological pinnacle of the search for uniqueness. There's little doubt that decades later, the singularity of Hine's One-Cent Magenta did cont...

How To Bloom Where You're Planted

With Joann Lublin, Wall Street Journal's management news editor, columnist, and author of  Earning It: Hard-Won Lessons from Trailblazing Women at the Top of the Business WorldBloom Where You're Planted Joann Lublin, the Wall Street Journal's management news editor, columnist, and author joins Steve to talk about her book  Earning It: Hard-Won Lessons from Trailblazing Women at the Top of the Business World and its exploration of the careers of businesswomen and what they can teach other women about making it in business. Steve keys in on one of the ideas Lublin writes about: “blooming where you're planted.” The phrase originates in the story Joann tells about Avon CEO Andrea Jung and her early years as an employee of Bloomingdale's. In her mid-20s, Jung was working as the store's swimwear buyer, where she had already enjoyed some success. When the CEO asked Jung to meet him for a chat, she excitedly hoped that she was about to be tapped to run the glamorous “ready-to-wear” department. Instead, the CEO asked her to take over the neglected “intimate apparel” division, which was if anything a demotion in Jung's eyes, even as the CEO pitched the idea as an opportunity to revitalize a stagnant department in her own vision. The department had been run by the same man for 30 years and was staffed entirely with men, all with more time in the company than her. She knew she would have to overcome a mountain of skepticism and defensiveness. Despite her reservations, she accepted the challenge.On her first day in the new position, she recalled a poster she had seen in the HR department that read “Bloom Where You're Planted.” It seemed to propose an attitude of accepting certain limitations while seeing in them the possibility of a new type of success.  She realized at that moment that what had seemed like a career detour or setback could also be thought of as a chance to prove her value to management by turning around the fortunes of a failing enterprise. And turn around the department is exactly what she did, introducing a number of bold changes even when met with resistance from other employees. During the two years she was in the position, her innovations took hold, transforming customer’s expectations of what “intimate apparel” could be and, in turn, the department took off.  Jung recalled the experience as a “career-defining moment,” crediting it with helping her deal with situations she ran into at Avon years later where she again had to “bloom where planted.”Calculated Risk in the WorkplaceA common theme in the stories of women in the workplace that Lublin chronicles is being thrust into situations where they felt like they were “in over their heads.” This kind of scenario often has more to do with lack of experience than lack of talent or aptitude. Lublin notes that surveys have shown that men are promoted more frequently based on a perception of their potential to do a job, even one outside their realm of experience, while women are evaluated for promotions based on the specifics of their previous achievements. Lublin believes that many women who might assume leadership positions are thwarted from doing so because their skill sets and backgrounds don't exactly match the new roles they're striving for, a standard not applied consistently to men.  One antidote to this unfair and ineffective systemic bias, Lublin suggests, is that women could begin taking more calculated risks. In Andrea Jung's story, her calculated risk was sticking with a less-than-ideal job that she didn't want and putting forth her best effort because she saw opportunity there.Of course, some kinds of risks are riskier than others, and some of what Lublin calls “mission impossible” risks contain the possibility of a failure that might even damage one's career.

The Middle Class Is Shrinking Fast…Which Class Are You In?

Americans Are Richer Than Ever, But They Don’t Feel That Way. Which Income Class Are You In?On March 9, 2017, the Federal Reserve reported that the net worth of U.S. households and non-profit organizations rose to $92.8 trillion during the fourth quarter of 2016, up 6.3% from the end of 2015. This is a sum of all assets (such as homes, stocks, bonds, vehicles, and cash) minus all debts, including mortgages, credit cards, and student and auto loans. Actually, it’s amazing that they can even come up with a number like that!The big rally in stocks and a steady climb in home prices added more than $2 trillion of wealth to household balance sheets. The biggest contributor was the stock market, which added $728 billion to household net worth in the fourth quarter, and the continuing increase in national real estate prices, which climbed by $557 billion in the fourth quarter, reaching a record of $26.5 trillion. That exceeds the housing bubble’s peak by more than $1 trillion. Talk about a bounce back—wow!Household debt increased at an annual rate of 3.8 percent in the fourth quarter of 2016 to about $15 trillion, spurred by record-low interest rates. Consumer credit grew 6.2 percent, while mortgage debt grew 3.1 percent at an annual rate.But even though U.S. household net worth hit a new high, that news is small solace to a majority of Americans—and there’s the rub.That’s because a rising market benefits only a small percentage of U.S. households since stock ownership is concentrated among the wealthy. Many individuals who might have been invested have also missed the eight-year bull market. Cash flowed out of U.S. equity funds in six of the past eight years through 2016, according to data from Morningstar.On the other hand, rising home values benefited more U.S. households because there are more homeowners than stock owners and because the value of homes far exceeds the value of stocks held by typical American families. Even so, the homeownership rate is near a 50-year low and is well below its pre-crisis peak in 2006.This is why the so-called “wealth effect” isn’t having as much of an impact on how consumers are spending their money as it used to. I think the “wealth effect” has also been smaller than usual due to lingering caution after the financial crisis.In addition, the personal savings rate was at 5.5% as of January 2017, twice as high as a decade ago. And, while there are early signs of wage growth, wages have grown surprisingly slowly for much of the economic recovery. So, while bulging portfolios are nice, fatter paychecks are what we need to kick the U.S. economy into the next gear.This new report also begs the question: Which income class do you belong to?While politicians love to use the term "middle class" to evoke images of vigorous, respectable, hard-working Americans with good moral values, the truth is the middle class includes people with vastly different lifestyles and vastly different concerns.During his first speech to a joint session of Congress, President Trump blamed the shrinking of the middle class on America's trade policies, repeated his promise to provide "massive tax relief" to this group, and said that a merit-based immigration system will help struggling families get back into the middle-class category.But, really, what is middle class in America? Which Americans are actually middle class?The median household income in the U.S. is $56,500. So approximately half of all Americans fall below this $56,500 annual income figure and the other half are above it. But this figure, by itself, doesn't help us compare households of different sizes— $56,500 to a young couple with no children is very different from $56,500 for a couple with three children, especially if the kids are in college.What is Upper-Middle Class?According to census data from 2015, 6.1% of U.S.

How To Buy A Home When You Already Own A Home

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLWhat options does a current home owner have if they decide they really want to buy a new home but are unable to come up with the money before selling the home they're living in?  Terry talks with Steve about the ins and outs of what is called a “sale contingency,” in which a prospective buyer enters into a contract with a home seller that gives them the option to buy the new home if they sell their existing home by a certain date. Terry admits that these deals are often difficult to negotiate because they can delay the sale and add another layer of complexity from the seller's perspective. Moreover, they always come at a cost to the buyer, who, of course, wants to minimize those costs.A home sale contingency helps cash-poor buyers who have equity in their current homes get access to the liquidity (cash) they need—usually by selling their own home—to close a sale on a new home. The contingency essentially gives the buyer a little more time to sell his own home. To pull this off, the buyer must price his home more aggressively, accepting somewhat less than he wants to and somewhat less than the comps. The buyer's realtor must persuade the seller and his realtor that the buyer is serious about selling his own home within a short time frame and that the buyer's offer is not only competitive but a better deal than he'll get elsewhere. The seller is also likely to want a kick-out clause added to the contingency, which allows him to nullify the contingency contract in order to accept an offer from another prospective buyer.One way that a buyer trying to sign a contingency contract can influence the seller is by offering a “rent back” option. This allows the home seller to stay in his own home for a month or two after closing the sale, at a very reasonable rent. For many sellers, this is an attractive add-on to a contingency contract, though for buyers it represents another cost on top of the skin already sacrificed to aggressively sell the current home low and buy the new one high.Another option for contingency buyers is to take out a home equity line of credit (HELOC)—a kind of second mortgage—in order to raise the cash necessary to buy the new home. This approach is not without its risks and expenses either because a HELOC affects the buyer's debt-to-income ratio, and, therefore, the bank underwriting the new mortgage may back out. Buyers need to discuss the particulars of their situation with their mortgage underwriter before making an offer on the new home, whether a contingency sale or conventional one, to make sure they will still qualify for the new home loan. If all the key numbers are acceptable to the lender—income, credit, equity in the house—this may be a workable option.Steve and Terry wind down their conversation this week by talking about a new trend in home building: using shipping containers to build homes. These containers are cheap to purchase as is (between $1000 and $4500) and are repurposed by being painted, decorated, or otherwise treated to supposedly look like “real homes.” These might be multiple modular “cans” or solo ones, and the process of turning them into homes is called “upcycling.” Some have been spotted on the market north of $200,000. This trend also has some commercial applications like the hip new restaurants in the arts district of Miami. Neither Steve nor Terry have seen one of these container homes or restaurants in person, and they're somewhat surprised that such a small space—typically around 1000 square feet per container—could have very broad appeal but remark that it fits in with the consumer interest in “tiny homes” of late.

Investing Uncertainty Got You Down?  Here's How To Use It To Your Advantage

With Vitaliy Katsenelson, Chief Investment Officer at Investment Management Associates and contributor to Institutional Investor MagazineThe Argument For Why Investing Uncertainty Is Actually A Good ThingVitaliy Katsenelson, CIO at Investment Management Associates in Denver, rejoins The Steve Pomeranz Show to talk with Steve about the importance of making “I don't know” a part of your investment strategy, and how familiarity with your portfolio holdings can make a big difference in terms of tolerating uncertainty. Referring to a recent article by Vitaliy on the subject of not knowing everything that might influence any given investment, Steve wonders whether saying “I don't know” would be professional suicide for an investment advisor. Vitaliy responds by reconstructing a case he's made for an “I don't know” kind of agnosticism about different possible scenarios that might affect portfolio planning. By way of example, he talks about an article he wrote in which he dedicates a page for arguing each side of a debate about whether inflation or deflation was likely to occur in the near future. He says he realized, based on strongly worded emails he received about the piece, that investors and other observers of the economy tended to strongly separate themselves into either inflationary or deflationary camps.While offering a brief digression on how one might re-position one's investments for either inflation or deflation—adding gold for inflation or bonds for deflation, etc.—he says the deeper realization he reached is that either camp could be wrong, and there was no good way to be sure which would be more accurate. In any event, the cost of being wrong would be very costly. The end game is not to fatalistically say “forget it, it's impossible to know what will happen,” but rather to use not knowing as a jumping off point for a thought experiment whose goal is a portfolio adapted to complex circumstances. The best strategy for an “I don't know” world where either inflation or deflation is possible, Vitaliy reasoned, is to buy stocks that will maintain their value and hopefully their stock prices in either scenario. Vitaliy introduces the metaphor of the “second best hand in poker” to describe investors so convinced that their outlooks are correct that they misjudge the strength of their hand and pay a big price for doing so.Intrinsic Valuation vs. Short-term Stock MovementsVitaliy distinguishes the inflationary/deflationary “I don't know” portfolio from typical portfolio diversification. In this case, it's about using a methodology to identify companies that can perform well in both inflationary and deflationary macro environments. Unpacking this methodology, he sketches the outlines of how his valuation process works. One important point he makes is that there can be a disconnect between a company's intrinsic value and its stock price, even with very well known, heavily traded companies. In fact, one of the goals of value investing is to find stocks that are “mispriced.” For buy and hold investors, this means priced too low. He remarks on the paradox that sometimes it's good for investors when solid companies suffer a stock price decline. The reason for this is that it allows companies to be more aggressive about buying back their own stock, and this bodes well for the financial strength of the company and eventually for its shareholders. He even views these “corrections” in a stock price—if the underlying value of the company hasn't changed—as a buying opportunity for investors that have just taken the correction on the chin. This is a lesson he shares with his own clients, and he says that once absorbed, it can have a profound effect on their confidence in their portfolios. He adds that he considers it an important part of his job to “c...

4 Vital Habits Of Successful Entrepreneurs You Must Have

With Eric Schurenberg, Editor-in-Chief of Inc. MagazineWhen Do Entrepreneurs Cross The Line From Passion To Self-Neglect?Eric Schurenberg, Editor-in-Chief of Inc. Magazine, joins The Steve Pomeranz Show to talk with Steve about an article Inc. published on the financial habits of highly effective entrepreneurs and wealthy CEOs. The overriding principle, that in the long run separates successful executives from the rest of the pack, is “diversification,” which, in this case, refers to a diversified personal wealth portfolio.  A common scenario with entrepreneurs and CEOs is that they're so focused on growing their companies that they neglect their personal finances. Passion can become a kind of myopia equating the success of their company's future with personal financial sacrifices made in the present.  They convince themselves that any type of personal enrichment—from taking a larger salary to saving money in personal accounts to selling company stock—is at cross purposes with growing their business. Needless to say, not only can this outlook be personally damaging in the here-and-now, the negative impact it could have on the entrepreneur's estate can also affect their families and other beneficiaries.Extreme Lack Of DiversificationThe attitude we're describing is informed by a philosophy that goes something like: “Take care of the business today, and it will take care of you down the line.” While total commitment to their company's growth and success is in many ways par for the course for entrepreneurs and is generally lauded by peers and outside investors, when it comes to managing their personal financial goals and risks, company founders and executives would do well not to sink every last dime into their companies. Instead, they should diversify their wealth, just like everyone else. Too many company founders believe so fervently in their company's story that they see their own path to riches as running through their company's eventual success, to the exclusion of every other kind of investment they might make while building their business. From a risk standpoint, this is borderline crazy. No financial planner would ever advise a client to put all of their eggs in a single basket, and the fact that the basket, in this case, is one's own company makes no difference. There is also a widely-held belief that publicly investing all of your money in your company is a show of faith and confidence that will inspire investors and employees. This might be true to an extent, at certain junctures anyway, but that doesn't make it a wise strategy overall.1. Getting Started: Dedicated Retirement AccountInstead of betting everything on a huge payout down the road, entrepreneurs and CEOs should spend time and money diversifying their assets today. A good place to start is setting up a dedicated retirement account. A surprisingly large percentage of entrepreneurs skimp on this (up to 75% according to Inc.com), thinking that they will enjoy generous benefits when their company reaches a certain maturity. Eric describes a “solo 401k” program for people running solo businesses with only outside contractors. This has a big advantage over other 401ks because the maximum contributions are much higher, up to $50K a year, or $100K if a spouse works for the company as well. Entrepreneurs may never need this money if their dreams for their company come to fruition, but think of this as an insurance policy against the possibility that plans to become wildly wealthy come up short. There are, of course, a number of other types of retirement accounts that can be set up, each with different advantages, tax features, and so on.2. Buy Stocks Outside Your SectorOn a closely related note, entrepreneurs and executives should not load up their retirement accounts with company stock.

The Wisdom Of Howard Marks

Introducing Howard MarksI am going to introduce you to a lesser-known legend in the world of investing, a man named Howard Marks, who I’m guessing most of you have never heard of.Howard Marks is a 67-year-old billionaire who co-founded the investment management firm Oaktree Capital Management which now manages about $84 billion in assets and is a publicly-traded company with ticker symbol OAK.Oaktree's Market-beating ReturnsOaktree focuses its investments on high-yield bonds, distressed debt, and private equity and has delivered a whopping 23% average annual return over the past 25 years—that’s quite a mind-boggling return and, to put it in perspective, if you had invested $100,000 with Oaktree 25 years ago, you’d now have almost $18 million.   Marks has rightly earned his fame and fortune by very carefully managing money for his clients.Buffett Follows Marks's MemosLike Buffett, Marks too sends out folksy memos to Oaktree clients where he outlines his views on investing, the markets, and the economy that are insightful, direct, and sharply written, and have a strong following with value investors including Warren Buffett who says, “When I see memos from Howard Marks in my mail, they’re the first thing I open and read. I always learn something.” Marks also has a book titled The Most Important Thing: Uncommon Sense for the Thoughtful Investor which is a terrific book that I’ve have read. You can also read his memos on Oaktree’s website here.Success in investing is not a function of what you buy. It’s a function of what you pay.Marks recently gave a speech at The Wharton School and here are some of his comments that I wanted to share.It's What You Pay, Not What You OwnMarks said, “Success in investing is not a function of what you buy. It’s a function of what you pay.” And while that doesn’t sound quite right when you first hear it, it does when Marks puts it in context.  When he joined Citibank in 1969, all the big banks were into “nifty-fifty” investing, which was about buying the 50 highest-quality, fastest-growing companies in America (household names like Coca-Cola, IBM, Kodak, Merck, and Xerox) without really worrying about the price they bought them at. Investors bid up shares to about five times what these stocks were really worth and created a bubble—and lost 90% of their money by 1973 when these shares collapsed. Shortly thereafter, in 1978, Marks started Citibank’s high-yield debt practice and made a lot of money by investing in some of the worst companies in America.  That’s what led Marks to say that while investing is a function of what you buy, you should also pay close attention to how much you’re paying for companies relative to their intrinsic value. Don’t let bubbles carry you away.Investing Success Depends on Company ValuationA high-quality asset can be (and often is) overpriced and a bad investment, while a low-quality asset can often be bought cheaply and give you good returns.   The trick lies in knowing how to correctly value an asset beyond what its stock price says it’s worth. When I say “what a stock is worth”, it makes me think back to the story of Mr. Market, an allegory created by Ben Graham, mentor to Warren Buffet and considered to be the father of value investing.The trick lies in knowing how to correctly value an asset beyond what its stock price says it’s worth.Not-Loser’s TennisMarks also said he doesn’t play winner’s tennis but likes to play what he calls not-loser’s tennis.  That’s a little confusing, I know.  Here’s what he says.   If you think you can see the future and where the world is headed, go for winner’s tennis.  If you think the world is full of uncertainty and randomness, spend your time trying to avoid losers. If you avoid the losers, the winners will take care of themselves,

Using Retirement Money To Pay For College May Be A Huge Mistake

With Sharon Epperson, Senior Personal Finance Correspondent, CNBCDilemma: Paying For Kids CollegeParents have long faced the financial challenge of competing claims between their children's college education and their own retirement savings. What's new is that in the past decade or two the costs of college have inflated at near exponential levels. The consequences of this inflation are at least twofold: students are taking on massive debt on the one hand, and parent’s retirement savings are being depleted on the other. Sharon Epperson, Senior Personal Finance Correspondent at CNBC, joins Steve to talk about this dilemma, trying to find a balance between parent’s and children's contributions to the cost of college, strategies for retirement saving, and reigning in household expenses.Using Retirement Money To Pay For College: Don't Do ItWhile many parents pull money out of their 401k, IRA, or other retirement savings account to reduce the burden of college loans on their children, Sharon is emphatic that this is a boundary that should not be crossed. While the instinct to shelter your kids from what might be very heavy debt (the average is now $29,000) is natural, it should never be done at the expense of your own retirement funds, which cannot be easily replenished. There is no such thing as a “retirement loan.”  Steve comments that he often advises parents dealing with this issue that their children generally have a much longer timeline to pay back their college loans than the parents do to refill their retirement fund coffers.Lessons From The Struggle To Pay For CollegeSharon concurs, noting that parents don't have as long to recover from a financial setback as children do and, therefore, need ample savings.  She also believes that there are some potentially very valuable lessons that parents can take from this situation and impart to their children. It's important for parents to stress to their children that they too had to work and save to help pay for their own education (albeit far less in dollar terms), work extra hard for scholarship money, and perhaps even take on loans as well. One takeaway is that sacrifice is often required for achieving your most important goals, another that with the right attitude and understanding, loans can be a valuable tool, not just for what they can buy but for the self-discipline they require to pay down. The realization that they are about to leave the nest and that Mom & Dad won't be paying for everything can ultimately be empowering, especially when contrasted against students who are sheltered from that realizationThe Four-legged Stool Of Paying For CollegeSteve proposes a four-legged stool metaphor to explain how college can be funded: one leg would be student loans, another leg contributions from parents (whether from income they don't need or a college fund they've been investing in), and, as a third leg, the savings that the student has squirreled away from their own jobs. Sharon chimes in with the fourth leg: “free money” meaning essentially scholarship funds, a kind of holy grail in the college financing game. As difficult to believe as it may seem, the hunt for scholarships can begin at a young age while parents are supporting a variety of extracurricular activities. If a child excels in one or more areas, these could become building blocks later on that could eventually support a scholarship application. She notes that parents can start learning about specific scholarships and the criteria they're based on through the website fastweb.com. They may also be able to research scholarships sponsored by various organizations, perhaps a trade union you belong to, or local businesses, etc. Sharon argues that high school or even junior high is not too early to start crafting a resume for your children.

What You Need To Know About Home Insurance But Don't

With Terry Story, 26-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLTackling a couple of topics from her real estate survival guide, Terry talks with Steve about what a landlord can do when a tenant refuses to open the property for a visit from a real estate agent and prospective buyer, and what you need to know about home insurance before you buy a property.Uncooperative TenantsOn the first issue, Terry draws on the experience of real estate attorney Gary Singer, who was asked what the landlord's rights are when it comes to a tenant who resists showing the property to the landlord who brings along an agent or would-be buyer. The answer is that legally speaking while tenants are expected to cooperate with the landlord on allowing access to the property, in practice, it is hard to define or enforce, and with most leases, there's very little that can be done. With “reasonable notice” landlords ought to have access to make agreed upon repairs, which would allow contractors, lenders, and potential new tenants or buyers to see the property. Defining “reasonable notice,” it turns out, is difficult, at best, and, in reality, these repair visits can be deferred indefinitely by an uncooperative tenant. In theory, it would help if the landlord had this conversation well in advance of the date they want to schedule a visit, but that too offers no guarantee of compliance. Simply opening up the house while the tenant is away and showing or inspecting it can lead to accusations of harassment or missing or broken personal property, so that's not a workable option. Landlords can access the property during an extreme emergency like a house fire, but that's clearly not ever a desirable scenario.Limited Legal Options = Need for PersuasionSince there is so much gray area in terms of legal recourses to show the property, and options are limited even when it is going to be sold and there's nothing the tenant can do about that fact, it may make sense to try to persuade tenants to allow access with financial or other incentives. Terry suggests that landlords put themselves in their tenant’s shoes, and imagine how they might feel about making things easy for an owner who's kicking them out. Offering a reasonable discount on the remaining months in the tenant's lease can go a long way towards gaining their cooperation. Another option would be to offer the tenant the option to buy the property, even at some discount to the market value. As an act of goodwill, this can make a difference.House Insurance QuoteThe second topic from the real estate survival guide is home insurance, and, in particular, getting a quote or estimate of its cost before buying a home. After the mortgage and property taxes, home insurance is the third largest expense for homeowners. It's vital that you not fly blind on this component of owning property. Without a quote, or at least an estimate of its cost—a better one than your lender can provide—it's impossible to figure out your monthly insurance expenses. It's a good idea to contact an insurance agent before you make that bold offer on a home.There are many variables that come into play as far as the price of insurance, and one of the most important is location. This can be expressed as proximity to fire hydrants and fire stations or, more seriously, flood zones. In fact, flood insurance is required for properties in designated flood zones, and if you're in one, it can be the most expensive factor. Another aspect to the insurance equation with broad consequences is the age of the property. Roofs, in particular, need to be replaced every 20 years or so, and insurers won't even write a policy for a roof with less than 3 years of life left. If that's the case with the home you want to buy, be prepared to pay for a new roof. There are,

Stop Believing These Investment Myths That Keep You Broke

First, a question: How many of you who have invested in the stock market would like to know when the next major market downturn will be so you can protect yourself beforehand?I’m sure if I were posing this question to a large audience, I would see a sea of hands. I mean, who wouldn’t like to know the answer? Everyone wants to ride the rocket up and would love not to be strapped in for the inevitable fall. As a matter of fact, as an advisor, I’m getting calls all the time from clients saying, “Is this the time to get out? Can’t we take some money off the table?”So, here’s the problem. Most of the financial media as well as the venerable Warren Buffett, my hero, continually tout the benefits of investing solely in the S&P 500 Index. You know the S&P 500 — it’s a list of the 500 most important companies in America. It’s made up of the Apples, the Exxons, the Walmarts, and the Proctor and Gambles of the world, just to name a few.And, believe me, I agree with the idea that this index is truly a wonderful way for an investor to create wealth over a long period of time, but it has certain problems that tend to make it a very mediocre investment for most people.And you’ll never guess why most people do so miserably with this investment. Here you go, here’s the answer….ready? It’s because the investment is boring.It’s a one decision “decision” that is supposed to last you for the rest of your life. Most of us could not stand idly by without doing something for the rest of our lives. Markets go in cycles; they go up, they go down. Sometimes they go down mildly, and sometimes they go down horrendously. Unfortunately, the average investor can’t stomach the pain and will do something to reduce it.So here is my first reason, the first myth, that is keeping you broke:Myth #1“I should invest in the S&P 500, and it should be the only stock investment I should make!”What’s the reality behind that idea? Well, as I said, it could be your worst.So, you might ask me how I know this. Well, I have proof. Numerous studies have shown that, while the S&P 500 had earned 8% annually during the period of 1996-2015 (a 20-year period), the average investor earned only slightly over 2%. That is $320,000 of lost earnings on a $100,000 investment over 20 years.What accounts for this disturbing differential? I think it’s the emotional impact of suffering through market volatility. It is a result of the compelling force to have to do something during periods of distress. Like I said at the beginning, we all would love to avoid the pain of market downturns.So, what can one do about it? Well, here’s are some ideas:#1. Create a diversified portfolio of investments that Ying while others Yang. In other words, add some bonds, add some real estate, add some foreign markets to the mix.#2. Think of it like the hub and spoke of the wheel on your car, with the hub as the core part of your investment, which can be the S&P 500 and then for the other part, the spoke part, add the other types of investments that I just mentioned.#3 Read a book on investing psychology. There are so many good books out there that can help you dramatically. They can help you understand your feelings and, by understanding, you may be able to change those feelings and do the right thing during market downturns.Myth #2Growth Stocks like the Apples and Googles of the world make you more money than boring stocks like Walmart, and Verizon, and General Electric, and AT&T.Who doesn’t love a great growth story? Apple going from $3 per share to $140, Amazon rising from $10 to a staggering $800 per share. That’s real wealth creation! Those kinds of stocks are fun and sexy and make great copy for articles and front covers for magazines. These types of stocks disrupt old industries and, in truth, many improve the economy and our lives.

An Anniversary To Remember: The 2009 Bear Market Low

March 9, 2009: The Day Stocks Bottomed OutI wonder if any of my listeners, especially those active in the stock market, remembered the historical significance of last Thursday, March 9th, 2017??Well, believe it or not, that day marked the eight year anniversary of when stocks bottomed out on March 9, 2009, the worst of the blood bath of the 2008 financial crisis, aka the 2009 bear market low.But first, let’s first recap what happened. The 2007-2009 financial crisis spawned a 17-month bear market that lasted from October 9, 2007 to March 9, 2009. In that period, the S&P 500 lost approximately 50% of its value. While the decline was incredibly nasty, the duration of this bear market was relatively short due to the extraordinary interventions by the government and the central bank to prop up at-risk companies.The bear market was confirmed in June 2008 when the Dow Jones Industrial Average (DJIA) had fallen 20% from its October 2007 high, which it reached after the heady bull market of 2002–07 when property prices and stock values were on a tear.On October 11, 2007, the Dow hit a peak of 14,198. before starting its decline.The decline of 20% by mid-2008 was in tandem with other stock markets across the globe. On September 29, 2008, the Dow experienced a record-breaking 777.68 drop with a close at 10,365.45. It then hit a market low of 6,443.27 on March 6 of ’09, having lost over 54% of its value since the high of 2007. The bear market then reversed course on March 9, 2009, as the Dow rebounded in the next three weeks more than 20% from its low up to 7924.56 and then it went up 30% by mid-May and over 60% by the end of the year.Interestingly, when stocks bottomed out that day eight years ago—amidst fear, doom and gloom—The Wall Street Journal’s Money and Investing section ran a story with the title, “How low can stocks go?”And, back then, it wasn’t an idle question. The Dow was on its fourth straight week of losses, while the broader S&P 500 was below 700 for the first time in 13 years. Goldman Sachs put out a research report that warned that the S&P could fall as low as 400. Imagine that! Goldman Sachs, the ultimate insider on Wall Street, was so gloomy on stocks and completely misread the tea leaves and predicted a further 40% drop in the S&P from its 700 level. Stunning!So, eight years ago, on March 9, 2009, the Dow closed at 6,547, the S&P 500 was at 677, and the Nasdaq closed at 1,269. Fast forward to March 9, 2017 and the Dow closed at 20,858, up almost 220%, or about 18% a year on average. The S&P 500 is now near 2,365, up 250% or about 19.6% per year; and the Nasdaq is near 5,840, up the most with a gain of 360% or about 24% per year. That’s a pretty phenomenal bull market.Now, eight years later, we know without a doubt that March 9, 2009 was the bottom of a months-long financial panic that wiped away trillions of dollars in assets. But on what now appears to have been the best buying opportunity of a generation, many only wondered how much lower the markets would tumble. And this underscores a recurring theme I point to: That emotion, fear, and uncertainty get the better of even the most experienced and qualified investors in the market. That it’s futile to try and call the bottom in real-time, and that investors should always look for dips as long-term buying opportunities on good quality stocks.I was an investment advisor, of course, during that period of time, and on March 9, 2009—I remember like it was yesterday—I would not buy on that day. As a fiduciary, legally in charge of other people’s money, I thought that the economy was too worrisome to commit clients’ funds. But by May and June or so, I started to feel more confident and waited for the confidence to come back into the market and then I started to come back in.Looking back, everywhere you turned on that March 9 day in 2009,

The Art Of Improvisation And Business Communication

With Bob Kulhan, President, CEO, and Founder of Business Improv, Author, Adjunct Professor at Duke University's Fuqua School of Business and Columbia Business SchoolBob Kulhan And The Evolution Of Business ImprovBob Kulhan, author, actor, and CEO of Business Improv, as well as adjunct professor at Duke and Columbia business schools, joins Steve to talk about what business people can learn from practicing techniques borrowed from the world of improvisation. Bob has worked with Tina Fey and Amy Poehler and has taught for many years at Second City, Chicago's legendary comedy club and talent incubator. While he's gone on to help countless businesses improve their communication cultures via corporate training programs staged by Business Improv, his insights and practices could arguably be used by just about anyone, whether to become more productive in business or for relationships overall.Improv Becomes Experiential LearningBob's experience with improvisation dates back over two decades when, much to his parents' chagrin, he abandoned an up-and-coming small business to dedicate four years to studying improv. After finishing that study in the mid-90s, in a development he describes as “pretty much by coincidence,” he forged the idea of running corporate training workshops based on improvisation concepts. The initial results were mixed; many clients had a hard time seeing any lasting value beyond a few diverting hours of fun.  It wasn't until he landed a gig creating experiential learning programs at Duke's Fuqua School of Business that his ideas really started to take flight. The Fuqua School brought further conceptual weight to Kulhan's experiential improv practices, folding in academic work from fields of study like behavioral psychology, cognitive psychology, organizational theory, and behavioral decision making.Rules Of Improv And Corporate TrainingAs a musician himself, Steve observes that most art forms are based on rules and discipline and asks Bob to talk the rules of improvisation as they relate to business and helping people and teams get better at what they do. Bob states that the core concept of improvisation is something he calls “Yes, And.”  This short phrase could be contrasted against “Yes, But” and the sense starts to come into focus: The former opens a path for continued dialog and exchange, while the latter tends to foreclose certain possibilities.  As Bob eloquently states it: “‘Yes’ is unconditional acceptance; you give me this gift, this offer, this opportunity. ‘And', then, is the bridge to what you do with it, your intelligence, your energy, your attitude.” This is the fundamental rule in improvisation because it opens many doors, including one Bob labels “postponed judgment,” which also has resonance in a business context. Other qualities that “Yes, And” hones and brings to the forefront include slowing down and being focused in the moment, qualities that promote leadership and emotional intelligence.  Communication is encouraged and enhanced by “Yes, And” both on an individual basis and a collaborative team level. It also offers value as a conflict management practice. All of these refinements to communication scenarios and norms that the art of improvisation offers can bring enormous business value.Steve wonders how much good improvisation depends upon relevant experience that can be drawn from. To use the music analogy again, it appears that even improvised playing is dependent on the ability to call upon a kind of stock or vocabulary of memorized riffs and phrasings. Bob agrees that becoming truly good at improvisation requires years of study and practice. He's sanguine about the possibilities, however, suggesting that verbal improv affords participants the chance to organically explore “infinite potentials.

Higher Drug Prices Got You Down? Lower Prescription Costs With These Easy Tips

With Dr. Lynne Nowak, M.D., Medical Director for Express Scripts LabManaging Your Healthcare CostsLynne Nowak, internal medicine MD and Medical Director for Express Scripts Lab, a pharmacy benefit management service, joins Steve to talk about getting a better handle on your healthcare costs, pharmacy benefits, and new information technology that empowers patients. Steve mentions a recent survey which demonstrated that 50% of consumers don't know how to predict their own out-of-pocket healthcare costs, either presently or in the future. It also found that dealing with costs is the most stressful and difficult aspect of managing their healthcare.  Furthermore, only 25% of those surveyed had any money saved for healthcare for next year. Dr. Nowak's first piece of advice for people suffering from this kind of uncertainty, lack of information, and fear of out-of-control costs is to delve into their insurance benefits, especially their pharmacy plans since those can be both consistent and expensive. Pharmacy plans can vary a lot, even person by person, so you need to understand the rules in your plan.Preferred Pharmacy: Lower Drug Costs, Home DeliveryDiving deeper into the prescription drug issue, Dr. Nowak notes that most plans have a pharmacy network and, oftentimes, a preferred pharmacy that the insurer has negotiated better terms with for their customers' benefit.  Co-pays through that preferred pharmacy can be significantly cheaper than those that can be found by shopping around at retail pharmacies. Some pharmacy plans offer home delivery, which is not only convenient but also less expensive. Co-pays are again cheaper with this option and a 90-day supply of medication can be delivered instead of the typical 30-day supply.  Dr. Nowak mentions that the cost savings are found on both the insurer and patient sides, and home delivery is safer to boot.  Speaking of her own company Express Scripts, she adds that the home delivery option doesn't deny patients the ability to shop retail pharmacies.Despite there being more healthcare information online and through providers, almost half of US consumers have not even logged onto their insurance company's web portal or called in for basic information.  Steve wonders whether a near majority of insurance plan holders are in denial about their lack of knowledge of their healthcare benefits.  Dr. Nowak argues that it's less about denial than it is about patients not understanding what advantage they can gain from insurers websites and mobile apps. As an example, she describes how the Express Scripts app, which many of their clients (insurers) offer to their customers, allows one to look up the price of a medication before it’s filled. Comparative prices are shown, and, if the plan works with a preferred pharmacy, the prices/co-pays for that pharmacy are shown as well. Information about generic versions of drugs and their costs are offered in the app as well.  Patients would do well to look up this information before their next doctor visit and bring these generic alternatives to the attention of their doctors because it can save them a lot of money. Unsurprisingly, not all apps have the same features and plan agnostic ones like GoodRX only provide retail price comparisons, while those provided by an insurer or pharmacy benefit management service like Express Scripts are able to drill down into pharmacy networks and specific benefits.Pharmaceutical Companies and Drug PricingSteve brings up the topic of certain drug companies charging exorbitant prices for their drugs and wonders how that affects managers of pharmacy benefits. Dr. Nowak explains that instances of blatant profiteering are luckily not as common as one might think but acknowledges that it certainly is a concern for Express Scripts.

3 Questions You Need To Ask Before Buying Your Next Home

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLHousing Prices Approaching A Top?The housing market continued to gain strength in 2017, with the final quarter delivering the fastest sales pace all year.  Home prices are still appreciating, notching their 58th consecutive month of year-over-year gains.  That said, Terry notes that many buyers are expressing a tinge of trepidation about and resistance to current prices. The fiery stock market in recent months appears—paradoxically, at least, on one level—to be contributing to the modest increase in conservative sentiment, a raising of antennas that markets may be overbought. To some extent, this resistance to current home prices can be explained as a vestigial reaction dating back to the massive meltdowns in the housing and stock markets in 2008.  Even though low housing inventory is playing into sellers' hands and adding pressure on buyers to make offers higher than they want to, prices are rising much more slowly than before. Steve avers that he sees only a very small risk of a systemic crisis on that magnitude. He also states that he thinks that a certain amount of skepticism about prices is a sign of a healthy market. It's natural and perhaps even helpful to a self-correcting market for prospective buyers to take an extra breath and say “I'm not comfortable at these price levels”.  Healthy, rational markets should fluctuate and adjust to accommodate these kinds of dynamics.Questions Before Buying A HomeAddressing the buyer side of the market equation in more detail, Steve asks Terry to walk listeners through a brief survey of the three questions that prospective buyers should ask themselves before searching for a home. The first question is “Why do you want to own a home?” Casting aside the common answer that a home is a good investment (it may or may not be), Terry presses her clients to be specific: Is it because you want a great place to raise your kids?  A safe place for your family? Do you want a larger place? Do you want more control over your space than you have at a rental?  The next question is “where”—not only in terms of location but as in “where are prices headed?”  While acknowledging that mortgage rates are expected to rise moderately this year and that prices will probably rise somewhat as well, Steve believes that other factors like location deserve to be weighted more, and neither of these variables changes how much you can afford to pay for a home. Terry agrees, adding that spending less than you can afford is often a smart play, especially if that means owning a home that will also be more affordable for other buyers in the event that you decide to sell it.Another key element in determining the criteria of your house search is how long you expect to live in the home. For people getting serious about a home purchase, that should ideally be between 5 and 10 years.  Five years is typically the “break-even” point in a normal market where you can sell without losing much capital. If you expect to move again in less than 10 years, you should reconsider buying a home and seek out objective professional advice. Steve notes that this is similar to the advice he'd give to someone about to make a significant investment in the stock market: If your timeline is less that 10 years, the risk you're taking on will invariably be much higher.Condo Association “Sleepover” RulesSteve wraps up today's segment with another letter sent to the Sun Sentinel's Gary Singer, this time about a condo owner whose housing association has asked her to fill out a tenant application for her boyfriend who frequently overnights. The writer feels like it's “juvenile” for the HOA to ask this of her for her boyfriend's sleepovers. Terry says the only real resolution can be had by reading the HOA's govern...

First Time Investors Should Avoid These 6 Dangerous Moves

Remember the first time you heard about the stock market? I’m sure it got the adrenaline up for many of you: excited about picking stocks, with dreams of doubling, tripling and 10x-ing your money, the early days when you hadn’t tasted your first loss of capital and were completely unaware of the dangerous pitfalls of inexperienced, untrained, and over-confident investing. It’s almost like a rite of passage, where the market quickly hazes newbies and shows them that it’s the one that’s all powerful.So, for those of you who are new to investing, let me give you a few tips on how you can keep from getting burned by the market.* Jumping in Head FirstThe basics of investing sound really simple in theory—buy low and sell high, that’s it! How hard can that be, right??  Well, you’ll be surprised. To make money with this simple strategy, you have to know what “low” and “high” really mean.Remember, in the stock market, when you buy, someone else sells; and when you sell, someone else buys. So, what you may think “high” as a seller of shares could be considered “low” (enough) by the buyer in any transaction. Are you really smarter than your anonymous counterparty?See what I mean, how different conclusions can be drawn from the same information? Because of this hard-to-pin-down relative nature of the market, it is important to study up a bit before jumping in. It’s really never as simple as “buy low and sell high”. I always say that investing is simple, but it’s not easy.Before you start investing on your own, I do believe you should read up on basic accounting so you understand terms such as revenue, revenue growth, operating expenses, operating profit and earnings per share that feature in a company’s income statement. It’s also important to understand terms such as cash, total assets, current assets, goodwill, total liabilities, current liabilities, and owner’s equity (also called book value), which are features on a company’s balance sheet, and terms such as working capital and cash flow, so you’re in a slightly better position to truly assess a company’s financial position before you jump on someone’s recommendation to buy a “hot” stock.In addition, it’s also important to understand a few basic metrics that let you gauge a company’s stock price relative to its financials—terms such as book value, dividend yield, price-to-earnings ratio (P/E) and so on. Understand how they are calculated, where their major weaknesses lie and where these metrics have generally been for a stock and its industry over time,  so you can compare a company’s stock valuation relative to its fundamentals and relative to its competitors or the market as a whole.While you are learning, it’s always good to start out by using virtual money in a stock simulator. Most likely, you'll find that the market is much more complex than a few ratios can express, but learning those and testing them on a demo account can help lead you to the next level of study.* Playing Penny Stocks and FadsLet’s talk about penny stocks. At first glance, penny stocks, which literally cost less than a dollar per share, seem like a great idea to invest in. With as little as $100, you can get a lot more shares of a penny stock than of popular companies such as Facebook that costs about $136 per share or Google that costs $830 per share… right? And, you may be tempted by the sizable upside if a penny stock goes up by a dollar.But remember: a penny stock is a penny stock for a reason. The market doesn’t believe the company warrants a higher valuation and that the company may not offer much future gain. What penny stocks offer in position size and potential profitability may reflect high volatility and poor expected returns. So even if you buy a stock for 50 cents, its higher volatility means you could end up losing the entire 50 cents should the company tank.

5 Tips For Investing In Your 30s

As many of my listeners know, I am a huge proponent of saving diligently and investing as early as your first paycheck to take advantage of the magic of compounding.If you skipped saving and investing in your 20s, don’t worry. You’re definitely not too old to reap the benefits of investing. Getting started now gives you plenty of reasonable paths to building a multi-million dollar nest egg by retirement.Especially now with the stock market hitting new highs, if you’re working and saving and have been afraid of the stock market, wake up! Put the past behind you and get invested. You have a long time to have these investments work out in your favor.1. Start with your 401(k)A 401(k) is the first place most people should save for retirement. It has a high annual contribution limit of $18,000. Contributions get swept into the account directly from your paycheck—before taxes—like magic. And, perhaps best of all, many employers will match your contributions, at least, up to a cap. That’s free money you won’t find through other offerings.Here’s the payoff: Let’s pretend you make $50,000 and begin saving at age 30. Let’s also make a few reasonable assumptions. Let’s say you get 2% annual salary increases, save 10% each year towards your 401(k), collect a 3% match from your employer, and get a 6% average annual return on your investment.  This alone will net you a little over $1 million by age 67. If you make more, save more and invest more—all the better.2. Supplement with a Roth IRAOnce you’re capturing that full 401(k) match, you should take a second look at your 401(k)’s investment options and take particular note of the plan’s administrative fees. If your plan is too costly, you’re better off directing any additional contributions to the second-best place for your retirement savings: an individual retirement account, such as a Roth IRA.As I noted above, with a 401(k), your contributions go in pretax, which means they’re taxed when you withdraw them in retirement. With a Roth IRA, your contributions go in after-tax, which means you invest, pay no tax when you make withdrawals in retirement—so your money grows tax-free in a Roth IRA—which is really nice.This tax diversification is why it’s a good idea to combine a 401(k) with a Roth IRA if you meet the income eligibility rules for a Roth.The downside is that IRA contributions have lower caps than 401(k)s, just $5,500 in 2017 versus $18,000 in your 401(k). So, if you max out your IRA contribution, go back to your 401(k) until you hit its $18,000 ceiling.Consistently saving $5,500 in your Roth IRA each year beginning at age 30 with a 6% return will give you about $740,000 at age 67. But remember, we called this a supplement, and that’s $740,000 you can draw on tax-free in retirement, over and above your 401(k).3. Time is on your sideYoung people have a long-time horizon before retirement, which means they can worry less about short-term stock market volatility and stay invested for the long run and get the higher long-term returns associated with stocks without worrying about bonds, etc. So, while in your 20s and 30s, focus your investments on stocks and stock mutual funds. But do not get greedy or cocky! Be prudent, don’t bet the bank on speculative stuff, diversify, ignore market volatility, do not rush in to buy or sell, but hold your investments over time. And for the stocks that pay dividends, I’d strongly suggest you enroll in automatic dividend reinvestment, where as soon as your dividends are paid out, they are used to buy additional fractional shares of the stocks you own… this also works for ETF’s and Mutual Funds and is a great way of building your wealth.Let’s say you played it safe in your 401(k) and earned an average annual return of 4% through some combination of bonds and other investments, instead of the 6% you could get with stocks.

The Warren Buffett Index Funds Controversy Explained

With Frank Byrd, Founder of Fielder Capital GroupWarren Buffett Index FundsSteve's last guest today is Frank Byrd, a money management veteran, former Merrill Lynch financial consultant, chartered financial analyst, and founder of Fielder Capital Group.Frank joins Steve to talk about Warren Buffett and his value investment strategy and, relatedly, the performance of index funds versus active portfolio management and why big money management firms are often a poor match for small-time investors. Steve kicks off the conversation by mentioning that he too worked for Merrill Lynch in a sales capacity at the beginning of his career in finance. He asks Frank to talk about his encounter with the reputation, writings, and strategies of Warren Buffett while he was still hammering away making cold calls to sales prospects. The back story to Frank's discovery of Buffet is that during his sales work, he developed relationships with a number of older individual investors who had enjoyed a successful long-term track record in stocks. These investors tended to pick stocks of companies that they understood and had confidence in. With very modest beginnings, many of these investors had accumulated multi-million dollar portfolios over the decades.Warren Buffett Value InvestingThis experience – seeing an approach to investing that worked and trying to develop a repeatable strategy based on this success – was at odds with the Wall Street research Frank was reading at the time. A breakthrough came when a colleague brought him a copy of Buffett's annual report for his company Berkshire Hathaway. Buffett's commentary lined up with Frank's observations and emerging investment philosophy and, as he put it, immediately “changed my life.” Finally, here was an approach to investing that simply made sense: “Buy shares of great businesses run by great people at good-to-great prices and hold them a long time.”  This goes a ways towards describing the value investment philosophy in a nutshell.  Steve describes a similar experience while working at Merrill Lynch when the head of research explained the core concepts of value investing, setting Steve on a path to discover Buffett himself.Value-oriented Money ManagementFrank began to attend Berkshire Hathaway meetings while researching other successful money managers that followed Buffett's strategy of buying a small number of stocks and holding them for the long-term. These managers had the common denominators of low portfolio turnover (infrequent buying and selling), lack of “over-diversification” (low number of stocks), and a value orientation (understanding company balance sheets).  Extensive research identified only a half-dozen managers with strong track records that followed these principles. Unfortunately, only half of these managed funds were open to new investors. The main question in Frank's mind was why there so few managers with strategies guided by these concepts.After Merrill Lynch, and still driven to learn more about Buffett's and a mere handful of other manager’s approaches, Frank went back to school to get an MBA at Columbia University where Buffett himself studied under Benjamin Graham, the founder of value investing.  Steve brings up a contradiction between, on the one hand, the widely held (as well as critiqued) idea in economics of “the efficient market,” which says that markets price in all known information about a company, thereby making it virtually impossible to get a jump, price-wise, on other investors and, on the other hand, Buffett's seeming success at gaining just such an advantage over other investors. While some would see buying at a certain price as a kind of timing, Buffett's commitment is to buying stocks at a reasonable price based on their financial fundamentals and holding for the long term.

Even Steep Discounts Aren't Reviving The Sale Of Luxury Homes

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLPending Home Sales Down in January 2017 Pending home sales dipped in January 2017, a state of affairs which Terry attributes to an imbalance between supply and demand in the housing market.  Housing inventory is less than 6 months, which means, in theory, that if no new sellers added their homes to this inventory, all available supply would be sold in less than 6 months.  This sub-6 month supply, incidentally, is the criteria for using the term “seller’s market,” and that is certainly the case in locations across the country today. Terry notes that roughly only 20% of homes that hit the market sell in a timely fashion, and the remainder – which fail to sell because they're too expensive or unattractive for other reasons – constitute the bulk of the unsold inventory.Low Housing Inventory: Seller’s Market It might seem counter-intuitive that pending sales have fallen in a strong housing market, but, in part, the recent successes for home sellers have set the stage for the current hiccup by depleting the number of sought after homes for sale. Returning to the lower number of pending home sales, fewer sales contracts means fewer pending sales, and, eventually, fewer closings. Terry explains that the lack of sales contracts, in her experience, is a result of buyers not finding what they're looking for and both sellers and buyers not being able to get on the same page in terms of the value of a home.  For many homes on the market, a holding pattern has set in, with both buyers and sellers adopting a wait and see attitude. This is the basic reason for the downturn in pending sales and completed sales.She describes many sellers as “greedy and unrealistic.” Delving a bit deeper into buyer psychology, Terry observes that a large number of would-be buyers, having witnessed the mortgage meltdown of 2007, are afraid the housing market is overpriced and are wary of buying into a market top. They see housing prices as being near a peak and expect them to, at best, flat-line for the next few years. The number of homes in the locations, condition, and price range that buyers find attractive is very low. Finally, uncertainty in the political realm and euphoria in the stock market are also contributing to a sense that the economy may be overheating.Luxury Market on HoldAs for the luxury market, asking prices have been coming down, sometimes significantly in dollar terms if not in percentage terms, but the number of buyers in that segment is not large enough to absorb the slack in the market. The strength of the US dollar is also weighing down on sales because it makes these properties more expensive for foreign cash buyers. Compound this factor with a frenzy of new building and thus competition in the high end of the market – at least in Florida – and buyers are taking more time to find more value and better deals.First-Time Home Buyers Seek Median Priced HomesThe market has been healthier and sales have been strong in other price ranges, particularly in and below the median 300-400K realm, according to Terry.  For sellers, asking prices still need to be tuned to the local market, with realistic discounts for needed upgrades and other liabilities.  First-time home buyers are out in force and ready to bid on well-priced houses. Correctly priced homes in the median range are still being bid up beyond the asking price, a sign of on-going strength in this niche. Meanwhile, expensive waterfront properties and overpriced homes in the wrong locale are languishing and for all intents and purposes aren't receiving bids near listed prices.

Warren Buffett On US Economy's “Secret Sauce”

The Secret Sauce of US ProsperityYou may have heard Warren Buffett describe the US economy's success over the past few American centuries as a “secret sauce” and also heard his beliefs on how and why America will continue to grow and prosper.  It is part and parcel of his bedrock belief in US prosperity and one of his favorite themes.  The secret sauce that powers the US economy, says Buffett, is made of innovation and productivity.In a 2014 dialog with Quicken Loans Chairman Dan Gilbert, Buffett praised the staying power of the US economy, arguing that babies born in America today are the “luckiest people ever born in the history of the world” thanks to an economy and society that “unleashes human potential like no system has ever unleashed it in history.”Polls these days show that a majority of Americans are pessimistic about the direction the country is heading, but Buffett says he “could not disagree more” with those sentiments.  For those worried about politicians reneging on Social Security or Medicare or Medicaid, he declares that “America’s Social Security promises will be honored and perhaps made more generous.”  And his message to parents fretting about dwindling job opportunities for their children is equally sunny and to-the-point: “America’s kids will live far better than their parents did.”In his 2015 annual Berkshire Hathaway letter to shareholders, Buffett wrote:“For 240 years, it’s been a terrible mistake to bet against America, and now is no time to start. America’s golden goose of commerce and innovation will continue to lay more and larger eggs.”Forget Politics, Buy AmericaJust recently in an interview on CNBC, Buffett remarked that he was unconcerned by the outcome of the 2016 US election because the foundation of the US economy was sound and resilient.  And he follows his optimistic take on the economy with his investment strategy. He said, “we're almost always a net buyer of stocks over time.”  For those that have followed his career at all, you know that this upbeat outlook about American business is nothing new for the Oracle of Omaha.  In 2008, near the low point in the stock market meltdown, Buffett wrote an article for the New York Times titled “Buy America. I am.”  He did exactly that, investing in stocks when fear ruled the market and, by all accounts, most of those investments have paid off handsomely.History of The Sauce: Productivity RulesThe story of America's 240 year-long run of productivity gains and innovation is the “secret sauce” itself and is one that Buffett returns to again and again, and he doesn’t shy away from the label of “secret” which he thinks is entirely appropriate. Buffett loves to mention that the average American is six times more productive today than they were when he was born in 1930. Crucially, this growth has nothing to do with Americans being smarter or working harder today but is, instead, a result of changes in workplace efficiency that have “unleashed human potential.”  In his view, productivity gains go hand in hand with innovation, meaning that technology drives productivity, and the need to improve productivity drives technology.But this doesn't only work for companies. The development of new products and services that “improves experiences” and even changes how people want to spend their time is another key part of the story of “America's economic magic.”  This kind of innovation brings products to market before consumers even know they want them. A great example of this is personal computers. PCs were hardly imagined as a concept at all until certain innovators brought them to market.  Buffett believes deeply that this productivity-slash-innovation dynamic has brought “awesome benefits to society” and is responsible for the “major gains in the goods and services we've received” and ...

Don’t Miss These Tax Breaks In 2017

With the April 15 personal income tax filing deadline just a few months away, I wanted to talk about a few tax changes for 2017 and remind you of a few tax breaks that you should use to reduce your tax burden. It’s a good list, so let’s get started with new or improved tax breaks for 2017.Gift Tax Exclusion for ABLE AccountsMany of you have probably not heard of this, but an ABLE account—which is short for Achieving a Better Life Experience— offers tax-advantaged opportunities for disabled people and their families. It helps them save and pay for expenses related to disability. Although ABLE account legislation was passed in 2014, these specialized accounts only became available for us to generally use in 2016.So, here’s what’s allowed: Anyone, including a family member or friend of a disabled person, can contribute up to $14,000 to an ABLE account without having to pay a gift tax. And earnings and distributions are tax-free when they are used to pay for qualified disability expenses such as:* Housing* Education* Transportation* Health* Prevention and wellness* Employment training and support* Assistive technology* and Personal support servicesThese accounts offer state and federal tax advantages. In addition, the first $100,000 in an ABLE account does not count as income or assets when disabled individuals try to qualify for public assistance programs. Although only nine states currently have ABLE programs, you can either open an account or contribute to one in a state other than your own. So, if you know someone with a disability, talk to them about this new ABLE account; it’s a good initiative and a great way to financially support those in need, such as say our disabled veterans or near and dear ones.Higher Tax ThresholdsYou’ll be happy to know that the IRS raised its tax thresholds for 2016, therefore, you'll likely pay a lower percentage of your wages toward taxes if you earned more last year than you did in 2015.For example, if you were a married couple, filing jointly, your joint income of more than $74,900 would have placed you in the 25 percent bracket in 2015. For 2016 though, you’ll have to make more than $75,300 to be in the 25% bracket.  I know that’s a difference of just $400, but, heck, every dollar matters. So be sure to check those tax tables at the back and see what tax bracket you fall in for 2016.Increased Earned Income CreditRemember Earned Income Credit—it’s something that came up a lot in the Presidential debates in 2016. Here’s the deal: If you have low or moderate income, you might qualify for a federal Earned Income Credit. The income-based credit is for everyone if you qualify. The maximum credit for 2016 is $6,269 for filers with three or more qualifying children. The amount reflects a $27 increase from 2015's figure of $6,242.If you qualify, definitely take advantage by filling out Schedule EIC and attaching it to your tax return if you have a qualifying child and meet the income requirement.Okay, now here’s a reminder of the tax breaks that every first-time home buyer should know:Home Mortgage Interest DeductionAs most of you know, mortgage interest deduction is one of the biggest home tax breaks. It covers interest paid on loans of up to $1 million, or $500,000 if you're married but filing a separate return. And this deduction can be especially beneficial for borrowers with new loans because interest charges on mortgages are typically steeper in the early years of the mortgage's term. In other words, of your fixed monthly mortgage amount, a greater portion is allocated to interest in the early years and less to paying back the borrowed principal. So if you recently bought a home, make sure you take this deduction while you can because there’s also been some talk of phasing this out.

What's The Minimum Credit Score Needed To Buy A House?

With Tim Beyers, Mortgage Analyst with American FinancingInterest Rates and Their Effect on Mortgage RatesEven though they had all but telegraphed their decision six months earlier, when the Federal Reserve nudged their benchmark rate up by a quarter of a percent at the end of 2016, it prompted an immediate torrent of news stories and blog posts about the effect this would have on mortgage lending rates and the housing market.While the consensus expectation is that US Treasury 10-year notes and 30-year bonds (which are seen as determining rates for mortgages) will inch up in lockstep with the benchmark rate, there's more to the story.  Steve's guest Tim Beyers, a Mortgage Analyst with American Financing, explains that there are two types of mortgage rates: fixed and variable.  Fixed rate mortgages are unaffected by changes in Federal rates, but variable rate mortgages usually float based on what the current 10-year note is yielding.  Adjustable rate mortgages (ARMs) are the most common variable rate loans and are most directly affected by changes in interest rates.  As some ARMs offer a “teaser” rate for 7 years, others reset after a year. The devil here is in the details.Both fixed or variable rate loans can be refinanced at a new fixed rate if the mortgage holder meets certain financial criteria.  This basic premise holds true for new mortgages as well—the borrower's financial situation plays into the rates at which banks are willing to lend to the buyer.  In Beyers's opinion, the recent 0.25% increase in Fed “funds rate” and an additional 0.25% rate increase—which the Federal Reserve has indicated it will make in 2017—will not affect home buyers very much.  It will affect 10-year and 30-year rates, which again will go up in proportion to the benchmark rate, and will also fluctuate based on longer-term expectations of the economy as a whole.  Steve and Tim agree that while we have no influence whatsoever on interest rates set by the Federal Reserve, we can control to some real extent the mortgage rates we are offered by improving our financial position vis-a-vis credit scores, debt, and the size of our down payment.Credit Score Needed to Buy a HouseWhether you're considering refinancing a mortgage or you're buying a home, it's critical to understand the effect of your credit score on mortgage rates.  Lenders will undoubtedly zero in on this number— also called a FICO score—as it is seen as the single most important factor in evaluating your ability to pay back a loan.  The interest rates you will be offered will vary depending on your credit score.  Credit scores typically run a scale from 500 to 850, and a score north of 740 is going to put you in a strong position to receive good rates. Obtaining credit score reports from the three major agencies can take time, but the law requires that agencies provide this information to you once a year at no cost.  The website to get these reports is annualcreditreport.com.  In addition to the headline FICO score, the agency reports will provide details about loans, revolving lines of credit (credit cards) and bankruptcies.  If you find outdated or wrong information in these reports, there is a process to correct it which involves sending a letter and supporting documentation to the agency.  This should take about 30 days.  Also noteworthy is that after seven years, delinquent loans and bankruptcies are automatically deleted from the report.Mortgage Hidden CostsSteve remarks that many home buyers fail to grasp the full costs of buying a home including, of course, the mortgage itself, but also “hidden expenses” related to repairs and maintenance among other items: fixing a roof or air conditioner, spraying for termite, etc.  Tim recommends that home buyers first use a mortga...

Selling And Buying Your Pet Friendly Home

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLCommercial Real Estate TechnologyIn this week's talk with veteran real estate agent Terry Story, we cover trends in commercial real estate technology and the technological forces driving change in commercial real estate, as well as questions about urban chickens and the hazards of pet ownership for home sellers and buyers.  The conversation starts with an open-ended question from Steve about how new technology is impacting or leading new trends in commercial real estate.  Terry affirms that technology is changing the game in a number of areas and begins an overview of these impacts by noting that many retailers are collecting data from their shopper’s cell phones when they are in the store.  This data is used not only for marketing purposes but also to guide decision making about store locations and floor layouts.  Retail brand apps that offer coupons and promotions have become an important marketing channel as well.  Some apps customize offers based on consumer behavior in stores and online, and, on the back end, this data can again be used to inform future business decisions.E-commerce Distribution Centers Terry brings up another trend where technology is affecting commercial real estate—the location of eCommerce distribution centers.  The phenomenal growth of online shopping has led to new challenges on the industrial side of retailer strategy, namely how to build distribution facilities in closer proximity to major markets and transportation infrastructure like rail, trucks, freights, etc.  Until recently, large eCommerce companies built distribution hubs outside of urban areas, where land, labor, and access to transportation resources are cheaper. In an era of same or next day shipping, when speed of delivery is a key competitive benchmark, distribution needs to migrate closer to customers. This shift is affecting commercial real estate demand and prices in formerly under-utilized industrial areas.Micro-unit ApartmentsTerry's final example of technology-driven change is the emergence of so-called “micro-unit” apartments around 350-500 square feet.  This trend is fueled by the high costs of urban living, and the apartments are generally priced for recent college grads, especially for those with expensive student loans. Many of these buildings are mixed use, with apartments situated above commercial property. While 350 square feet would feel claustrophobic to many, younger renters appear more willing to accept it as a tradeoff for living in hip urban areas.Neighborhood RoostersFrom today's grab bag of real estate questions, Steve picks a letter from someone living near a neighbor with a rooster. The poor guy seems to be on his last good nerve, what with the rooster starting his crowing before dawn.  Steve asks Terry what this guy can do short of buying a gun to deal with the problem.  Terry's first recommendation is to talk with the neighbor. If the neighbor is unsympathetic, check with the homeowners' association, if you have one.  The association can lean on the rooster owner and will probably have the support of all the other neighbors as well.  If you're not a member of an HOA, or if that fails to solve the problem, check in with the code enforcement division of your city. Most will have statutes against agricultural animals in urban or suburban areas, and if you bring a violation of these laws to their attention, they will force the rooster out of the neighborhood (or into a pot of soup, as the case may be).  The last resort would be a lawsuit, but, of course, that's not ideal because of the cost, even when you know the law is on your side.Pet Friendly Real EstateFinally, Steve segues to a question about pets and pet owners and the apparent increase in the number of pet owners ...

Learn To Spot Financial Fraud And Broker Malpractice

With Robert Port, Partner with the Atlanta law firm of Gaslowitz Frankel LLCNo Crystal Balls:  Recognizing Broker MisconductRobert Port is an Atlanta-based lawyer specializing in commercial litigation and fiduciary disputes.  He recently wrote an article entitled “Courtside Seat: Everything I Know About Investing I Learned in Court” which summarizes lessons learned from decades of representing individuals who've lost money thanks to the misconduct of their investment advisors, insurance agents, and stock brokers.The first lesson that Port and Steve discuss hinges on the unpredictable nature of markets. The simple truth is that no one has a crystal ball when it comes to forecasting markets or stock prices.  For one thing, these prices rise and fall based on news, which is itself unpredictable by definition.   Statements and insinuations by people pitching their skills and insights—claiming, for example, that stock XYZ or the S&P 500 will be 20% higher or lower by some date—ought to raise a major red flag.  Port argues that because of this randomness to asset price movements, it is impossible for brokers, fund managers, or financial newsletters to consistently time and beat the market.  They might outperform for a year or two, but, eventually, their returns will “revert to the mean average,” which will likely be lower than overall market trends, especially after fund and trading fees are extracted.  There is more luck than skill in beating the market, Port asserts, citing academic research that backs him up on this point.Why are so many investors susceptible to the duplicitous claims of those who present themselves as financial wizards who know when and what direction stocks are headed?  Naivete or an uncritical willingness to believe, greed, and lack of due diligence may all play into it, but one shouldn't ignore the major advantages that Wall Street and other operatives have when it comes to dazzling people with technical charts and analysis.  The arsenal of tactics and sophisticated language used by industry to draw individual investors into making bad decisions often rises to the level of misconduct and can be litigated as such.  The investments being peddled may be mutual or hedge funds or stock picks, among others.  As Port writes, the lesson here is to “Avoid actively managed investments. Stock picking and market timing are losers’ games.”Avoid Investment Products And Financial FraudOut of the seven lessons Port writes about in “Courtside Seat”, Steve asks Robert to elaborate on the fifth: “Be Leery of Investment Products”.  Port admits that “his antenna goes way up” when he hears the phrase “investment product” or “investment vehicle” because of his extensive experience working with investors who have gotten entangled in these to disastrous results.  Some examples of investment products that can be abused are limited partnerships, real estate investments, investment trusts, annuities, and mortgage-backed securities.  For starters, the firms which engineer these products don't always have their clients' best interests at heart.  Developed as they often are by MBAs and financial “quants” (who make mathematic models), they tend to be highly technical, wrapped in legalese, and opaque to just about anyone trying to understand how they work. Worse, they are often laden with fees and expenses that are not obvious to investors and not properly explained by the brokers that sell them.  Professional brokers themselves often don't understand what they're selling either. This kind of complexity should be a warning sign that you are getting in over your head. Port offers a simple rule of thumb: If you can't explain what and why you're investing in to a middle schooler, you probably shouldn't be buying it.

Why You Should Never Make A Lowball Offer On A House

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLLowball Offer on HouseToday's talk with Boca Raton real estate agent Terry Story begins with a question from Steve about the wisdom of making a lowball offer on a home you're interested in buying.  Terry states unequivocally that lowball offers are a bad idea all the way around, particularly in today's seller's market when a majority of listed properties receive multiple bids.  Not only are these offers almost always rejected when sellers have the upper hand, as they do now, but offended sellers generally won't bother to make a counter offer.  If the rejected buyer wants to submit a new, higher bid, his negotiating power is far less than it would have been without the lowball bid.Comps Based on Interior, Locale, Upgrades, PhotosFor home buyers trying to get a handle of what a fair price is for a property they're interested in, it's critical to look at neighborhood level comps (comparisons) that have recently sold within a 20% price range of the asking price. But this is just a beginning and relatively superficial.  A professional assessment would factor in the interior condition of the home, the qualities of its locale, and the need for updates or maintenance fixes.  One way to gain insight into the latter issue is by reading the realtor notes that accompany a listing.  While realtors trying to sell a home are naturally going to emphasize the best aspects of the home, what they leave out can be more telling.  A lack of details on items that require periodic updates – like roofs or hurricane windows here in Florida – can indicate problems that ought to impact the sale price.  As far as locale, a deeper look at the specifics of the property – does it back onto a lake or a busy road, for example – is important as well.  It shouldn't be a surprise that the shape that the interior of the house is in should also be a major consideration.  While you may have heard it before, it bears repeating that photos of the home can be deceptive and should not be a substitute for a tour of the property.  It's fairly easy for a professional photographer to make a home look bigger, prettier, and more pristine than it really is.  Buyer beware!Mortgage Pre-ApprovalSteve shifts the conversation to mortgage pre-approvals, asking whether they play a big role in the sales process.  Terry's answer is an emphatic yes: pre-approvals are critical, especially in today's market.  For starters, a pre-approval will give you a concrete idea of what you can afford.  Secondly, sellers now require pre-approval. Finally, in a competitive market like we have today, the buyer who has all her paperwork in order is going to have a much better shot at winning a bidding war.  The transparency of a buyer's financial position, that a loan pre-approval demands, is reassuring to sellers.Home Updates and Maintenance ItemsThe presence or lack thereof of key home updates and maintenance items can affect a home's sale price and buyer-seller negotiations.  While bigger updates to kitchens, baths, and floors are more easily factored in, maintenance issues (air conditioners, hot water heaters, etc.) often only come to light after a property inspection, after a price has already been agreed upon.  Sellers should ideally show some flexibility and willingness to either lower their price or have work done and old items replaced, but they frequently elect to hold the line, reiterating that the property is offered “as is" or offering only very minor concessions on the price. It's not uncommon for this stance to provoke buyers to rescind their offers and walk away. If a seller hasn't carefully considered the costs of needed maintenance work and/or replacement of aging items on the asking price of the home and...

Let The IRS Help You Build Substantial Tax Free Wealth

Reduce your taxes and build wealth with investments that offer tax incentives. From energy to real estate and more.

Trade Mindfully To Create A Larger Nest Egg

With Dr. Gary Dayton, Trading Psychologist and Author of Trade Mindfully: Achieve Your Optimum Trading Performance with Mindfulness and Cutting Edge PsychologyIn his new book, Trade Mindfully: Achieve Your Optimum Trading Performance with Mindfulness and Cutting Edge Psychology, Dr. Dayton presents the two true components to what can make you become a successful trader. Dr. Dayton is an expert on trading psychology and advocates applying the concepts and practice of “mindfulness” to improving trading strategies. Mindfulness, according to Dr. Dayton, goes back more than 2,500 years to the mental techniques used by yogis and Buddhist practitioners to calm and focus their minds on the moment, and he shows us how these strategies can be used by investors to reduce stress and the fear of loss and to control unwanted trading emotions and ‘recency’ effects—to improve objectivity in interpreting trading data and gaining an edge on portfolio performance.Loss Aversion, Recency Effects, and Other Biases and DistractionsHe discusses loss aversion and why losses hurt more than the euphoria of equivalent gains and how this impacts portfolio performance. His techniques are about training the mind for greater attention, better focus, and casting aside distractions and their influence on our trading behavior. The idea is to get over your visceral emotions and to let rational decision-making prevail. He shows us how to ignore data that really is not relevant to our portfolio’s performance, and gets us to dig deeper into questions that are more relevant to our trading goals.He addresses the ‘recency’ effect, where recent experiences are more heavily weighted in our minds and lead to irrational decisions. For example, three losses in a row lead to greater loss aversion or three profitable trades could lead to irrational exuberance and losing trades. He presents solid research on loss aversion (how losses hurt a lot more than equivalent gains) and how mindful trading puts loss aversion in perspective.So, listen in to get an edge on your trading strategies. While short-term trading may work for some, these mindfulness techniques can be equally useful for fundamentals-based investing and holding shares for the long term, which is undoubtedly a safer wealth preservation and growth strategy.

This Just In: Science Confirms Warren Buffett Advice

Neuroscience Investigation of Irrational Exuberance and Market CrashesI came across a rather interesting piece of research from Caltech. The paper has a rather long geeky title, “Irrational Exuberance and Neural Crash Warning Signals During Endogenous Experimental Market Bubbles”. It is about an experimental study to discover warning signs of irrational exuberance and a possible crash as market bubbles start to form. The paper’s findings have also been nicely condensed in laymen’s terms by Kimm Fesenmaier of Caltech. Warren Buffett's advice to “be fearful when others are greedy and be greedy when others are fearful” appears to have found a new foothold in this experiment's results.In their experiments, Caltech’s researchers used neuroscience to study the brain activity and behavior of people trading in experimental markets where price bubbles were artificially simulated and internally or “endogenously” created. They hooked up electrodes to traders’ heads and watched brain activity and behavior as stock prices rose to levels that were well above fundamental value to see how these experimental traders reacted as prices rose, as stock price bubbles formed, and then burst.BE FEARFUL WHEN OTHERS ARE GREEDY AND BE GREEDY ONLY WHEN OTHERS ARE FEARFULMarket Trends and Brain Activity: Classifying Different ResponsesOn analyzing this experimental trading data, researchers found two distinct patterns of brain activity. One small fraction of participants got early warning signals from their brains that made them feel uncomfortable and urged them to sell even as share prices were rising. The other larger group got brain signals that made them behave greedily, buying aggressively as stock prices rose and even after they peaked.Researchers found that the lucky few who received early warning signals and got out of the market early earned the most money while the larger group displayed what former Fed chairman Alan Greenspan called “irrational exuberance” and lost their shirts. Again, this pattern resonates with the well-known Warren Buffett advice about going against market currents during periods of fear and greed.Do Market Bubbles Come from Internal or External Factors?The researchers also saw a market bubble form without outside hype in the experiments; there were no television sets with talking heads hyping up their various views on the market, just experimental traders in a room reacting to rising stock prices. So, a bubble formed without any outside hype or misinformation, which was a bit of a surprise finding because general market wisdom mostly attributes bubbles to external hype or other external factors.Trading Strategies and Impulses of Low, Medium, and High EarnersResearchers then conducted a subsequent experiment. They divided participants into three groups based on market earnings—low, medium, and high—and found that low earners tended to be momentum buyers who started buying as prices went up and kept buying even as prices tanked, apparently hoping to make money on a bounce back or trying to lower their average purchase price because they bought when shares were peaking.Medium earners were those who played it safe, did not take too many risks, and neither made nor lost a lot of money. The high earners were traders who bought early and sold when stock prices were on the rise, above fundamental value, but well before they peaked.These high-earning traders emotionally did something that was really hard to do: they sold their shares in a rising market because the region of the brain that deals with risk aversion sent out strong early warning signals to this small fraction of high earners.Warren Buffett Advice on Fear & Greed Explains Trading OutcomesThe neurological experiment by Caltech’s researchers confirmed Warren Buffett’...

Trump Effect On Stock Market: From Hype To Snipe & Gripe

With Sam Stovall, Chief Investment Strategist at CFRA ResearchThe Trump effect on stock market: From hype to snipe and gripe?Veteran equities analyst and market patterns historian Sam Stovall joins Steve to talk about recent gains in the stock market, the Trump effect on markets, and the volatility and valuation of stocks headed into 2017, among other topics.  Steve kicks off the interview by asking Sam to review the market's reactions to President Trump's actions both before and after he was inaugurated, a sentiment that may be encapsulated in the phrase “from hype to snipe, then gripe”.  Stovall describes the exuberance that followed Trump's election victory as powered by expectations of deregulation of the financial industry among other sectors and a surge in earnings from industrial and materials companies that would benefit from the infrastructure development that Trump promised.  Fast forward to February, less than a month into Trump's presidency, and amidst the barrage of executive orders, there is a growing sense that perhaps some of the more heavily anticipated programs in Trump's agenda won't roll out in his much ballyhooed first 100 days in office, or even the first 200.  Stovall avers that the collision between the market's early pricing in of Trump's promised deregulation and stimulus and reality may result in a giveback of steep gains made since last November.Stock market volatility 2016 At Steve's prompting, the conversation detours to the stock market's performance in 2016, a year that saw a good deal of volatility between its bearish start and strong finish.  Tom recalls that many investors were expecting a recession at the beginning of 2016 led by weak earnings, a collapse in oil prices, and worries about China.  After further consideration, many came to the conclusion that the problems were mainly confined to the energy sector, and this analysis enabled a broader market rebound.  As far as the volatility is concerned—the market swung 23% as measured by the early lows to its end of year highs—Stovall points out that the market has averaged an annual 27% movement in every year since WWII.  While it may have seemed volatile, in historic terms it was actually a bit less volatile than normal.  Steve remarks that this data reveals an important lesson about volatility, namely that it does not reliably predict major market downturns.  Stovall agrees and amplifies Steve's point by noting that the stock market posted gains in 85% of the years since WWII.  Moreover, most of those up years experienced a negative year-to-date return at some point.  Stovall deduces from this data that volatility is simply a part of investing.  He makes a final, salient observation that volatility in bull markets rises over time and that the longer a bull run lasts, the more unstable it becomes.Bull market resilience and exhaustionIn another insight drawn from Stovall's trove of historical research, he describes a pattern in bull markets of robust recovery to break-even levels following 5-10% pullbacks and 10-20% corrections. Since WWII, 8 out of 10 market declines have returned to break even within 4 months, supporting the case to be made for buying stock during a pullback or correction.  Steve wonders whether this particular bull market is nearing an end, based on P/E ratios and its unusually long run, the 2nd longest since WWII.  Stovall reckons that bull markets “don't die of old age; they die of fright” and that what they fear is recession.  For this reason, Stovall focuses on broader economic trends, expressed by indicators like the treasury yield, number of housing starts and consumer confidence and supplemented by leading indicators, all of which can shed light on where the economy is heading.  According to Stovall,

From Successful Kickstarter Story To Shark Tank

With Elizabeth Granados, Creator and CEO of Little NomadThe Successful Kickstarter StoryElizabeth Granados returns to the Steve Pomeranz Show to follow up with us about her exciting journey to entrepreneurial success of her company Little Nomad.  She first joined us in June 2016 after a successful round of fundraising using Facebook to generate awareness of her product and capture emails of interested consumers and Kickstarter to solicit seed money, as well as email to promote pre-sales.  The whole process enabled her to take her product from concept to production and to accelerate brand and sales momentum.  Today we talk with Elizabeth about how she skillfully utilized these online resources, what has happened since launching her product, her appearance on Shark Tank, and how the business is evolving.Elizabeth describes how she first took her idea—illustrated foam play mats for babies and toddlers—and created a photoshop image to share on Facebook groups that she belonged to which targeted moms of small children.  The photo enjoyed some free grass roots advertising as it was also reposted on other group pages.  This boosted Elizabeth's confidence that there was a legitimate interest in her idea, and she acted adroitly to add a link to the photo that directed people interested in learning more to a landing page where they could sign up for email notifications.  In the meantime, she was working on creating a 30-day Kickstarter campaign to encourage pre-sales and invite investment capital.   When that was ready, she announced the Kickstarter campaign and the ability to pre-order the product to her list of Facebook emails.Successful Kickstarter CampaignsThe campaign raised over $100,000 in the first month, more than enough to manufacture the first batch of Little Nomad play mats. That first round of mats fulfilled all the pre-sales, leaving her with a healthy inventory with which to continue to grow the business, and money left over to invest in the business.  She credits the Kickstarter campaign with enabling her to side step using her own capital to get the business rolling. Apropos the manufacturing process, Elizabeth admits that she wished she had gone about it slightly differently.  Manufacturing requires a “final sample prototype” on which the fabrication of the product is based.  With the business growing quickly before a single play mat had been made, she felt a time crunch when it came to creating this sample prototype.  Ultimately, however, the prototype was created and the play mats were shipped and arrived on time.  Elizabeth enthusiastically adds that sales have more than doubled since the Facebook/email/Kickstarter campaign.Little Nomad on Shark TankSteve asks about Elizabeth's recent appearance on Shark Tank, ABC's popular show that pairs early-stage entrepreneurs with high-profile business people.  She talks about how, as a huge fan of the show, she'd long wanted to appear as a guest.  The application process was daunting, she explains, but she finally made the cut.  As Elizabeth tells it, she spent a long time preparing for her appearance on Shark Tank, reading the Shark books, memorizing her pitch, and learning as much as she could about her own business.  Not only did she demo her play mat, she brought along her 18-month-old daughter to clamber around on it.  While her baby did have a minor crying jag, it didn't interrupt her pitch too badly.  Steve shares that his impression was that the panel of judges was favorable overall and that the incident with the baby came across as funny rather than a distraction.One of the goals of the Shark Tank appearance was to raise more funds by offering ...

Is It Better To Pay Off Mortgage Or Invest That Money?

With Tom Anderson, Author of The Value of Debt and Building WealthSave or Pay Off Debt?Tom Anderson, author of The Value of Debt and Building Wealth, joins Steve to talk about the potential benefits of debt in terms of managing your retirement income, when debt should be “extinguished” as quickly as possible, and a variety of nuances in these and other scenarios.The conversation begins with Steve's observation that many folks, especially those under 40, see debt as a “four letter word,” something to avoid like the plague if possible.  He speculates that this outlook is a hangover from the housing bust in 2006 which resulted in thousands of underwater mortgages where people owed more than the value of their homes.  Foreclosures and job losses cascaded into further loan defaults and bankruptcies.  Steve asks whether Tom believes that the time has come for this generation—as well as others—to reconsider their view of debt as an inherently risky gambit and unnecessary burden.Anderson answers in the affirmative, though he's quick to add that not all debt is the same and that he would never recommend piling on debt for its own sake.  Instead, he argues that the generation that witnessed the housing bubble collapse should value flexibility and liquidity when thinking about debt.  Flexibility, in this case, means being open to using debt as a tool in the right circumstances, and liquidity is access to cash for an emergency reserve or other needs.  Anderson argues that people are generally too aggressive—or inflexible, so to speak—about paying off debt to the exclusion of liquidity.Anderson takes pains to ground his advice about debt in the reality that “staggering” debt permeates our society at levels higher than it ever has.  His conviction is that a “thoughtful, comprehensive, balanced approach” towards debt is needed which can guide individual decisions about when to pay down certain kinds of debt.  On a more sophisticated level, this approach can inform our overall financial planning, retirement savings, and asset allocation strategies.Pay off mortgage or invest?Steve explains that one of the most common questions he's asked as a financial advisor, and one that comes up frequently on this show, has to do with the wisdom of paying off your mortgage before you retire.  Tom's reply is more nuanced than a simple yes or no.  He begins by categorizing debt into three types: oppressive, working, and enriching debt.  For the most part, these categories are based on the interest rates of the loans in question.  Anything over 8% annually is oppressive, according to Anderson.  Credit card APRs are often higher than 8% and frequently double that and are, therefore, an obvious candidate to be paid off as soon as possible.  Mortgages, on the other hand, are typically much lower—especially those written in the 8 or so years since the Federal Reserve cut interest rates to near zero or those refinanced during this time.  If your mortgage interest rate is around 2-3% after taxes (or 4-5% before taxes), Anderson asserts that it would be better to build up your savings than pay off the mortgage.  The reason is that your savings, invested in a diversified portfolio that approximate market benchmarks, will be compounded, meaning that those savings will grow faster than your debt.  Most people will benefit more from a strategy of saving/investing than paying down debt early.

How To Price A Home Given Current Market Conditions

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLHousing Market 2017 Cross CurrentsThis week's conversation with Coldwell Banker real estate agent Terry Story touches on a variety of cross-currents affecting the housing market, including rising prices, confusion among first-time buyers over minimum down payments, low inventory, and the possibility of stronger single family home building and the dynamics that stem from pricing homes above or at market levels.While home sales grew and prices continued to rise last year, there are signs that demand might be topping out.  By the end of 2016, only 55% of non-home owners believed that now was a good time to buy a home, down from 63% at the beginning of the year.  With mortgage rates inching up, the perception of the market as too expensive may be gaining legs.  This view contrasts indirectly with the fact that 90% of homeowners last year were confident that owning a home was a key part of the American dream.  To what degree this confidence is rooted in the strong price appreciation accompanying this housing market recovery is up for speculation.Housing Inventory Delving further into this story, Terry reports that home prices and rents are up over 40% during the past 5 years, rapidly outpacing wage growth.  The combination of high prices, high student loan debt, and limited supply of entry level houses on the market are conspiring to put a damper on first-time homebuyers.  These dynamics, as well as the faster growth of rent prices, has steered builders towards apartments rather than standalone homes in recent months.  Nevertheless, Story is optimistic that low inventories and the fact that rents and mortgages are nearing parity will start to galvanize new home building.  An expanded supply of new homes should help correct the affordability problem to some degree and would be welcome for that reason.  An interesting metric that Terry shares is that a greater than six-month supply of homes for sale indicates a buyer's market, while a less than six-month supply signals a seller's market.  Terry's South Florida market is currently running at about a four-month supply, which is favorable to sellers.One area of confusion among new homebuyers is the question of down payments.  Many believe that they have to come up with 10% or 20% of the home's value and despair over being able to save enough to meet that number.  Terry reminds those new home buyers that they may be able to purchase a home with as little as 3% down.  With a lower down payment comes PMI (private mortgage insurance) and that adds to the total cost (but not the closing cost) of the mortgage.How to Price a HomeSteve and Terry wrap up their conversation by looking at the effect that a home seller's asking price has on potential buyers and their bidding.  Terry offers a simple hypothetical example of a homeowner with a home that they hope to sell in the $300-325K range.  If they list the house for $300K—a price Terry describes as “right at where the market is”—they are likely to get a surge of interest from potential buyers and oftentimes a competitive bidding situation will arise, pushing the price up towards $325K or more.  On the other hand, if the house is listed at $325,000—which is more aligned with where the market is heading—interested buyers should still show up, but there will be fewer offers and, in all likelihood, they will not bid the price up beyond its listing price.  Having multiple offers is always a better situation for sellers as it affords them some leverage to ask for a bigger down payment or other concessions.  Steve wonders whether there are pros and cons to listing a house at, say, $299,900 instead of $300K, and Terry replies that it absolutely does matter for one main reason: the way people search real estate websites,

How To Prepare For Your Next Financial Emergency

In early 2015, the Consumer Finance Protection Bureau proposed a framework for understanding financial well-being in terms of four elements.The first two have to do with financial security: feeling in control of your monthly expenses and being able to absorb unpredictable financial shocks.The other two are in regards to financial freedom:  being on track to meet goals and having the flexibility to make choices.I want to talk today about the second principle: being able to absorb financial shocks.Financial Emergencies Some of us seem wired to worry about money and finances.  You know a small amount fear can be a good thing, but it can also quickly snowball into a negative, energy-draining phenomenon.Start by asking yourself a series of questions: * Do you have a particular scenario or maybe a list of scenarios in mind when you worry about a future financial shock?* If this or another shock were to actually come to pass, what do you think would be the ideal resolution?* Also, what resources would you need in order to handle a surprise hardship? By resources I mean cash savings, health insurance, and unemployment insurance, or even other non-financial assets like your job skills.* What measures do you need to take to absorb the kind of shocks that you find most worrisome and keep you up at night? After all, if this is keeping you awake at night, it’s about time you got some well-needed rest.These worries could be anything from unexpected medical expenses, car or home repairs, emergency travel related to family crises, or job loss.Defining your particular fears and talking about them with a financial advisor is also something to consider.  It will help to identify unrealistic versus reasonable financial fears and what plan should be put into place to better put you at ease.There are at least two ways to prepare for a financial emergency, the first is putting aside money for an emergency fund.  I know that putting money aside can be difficult for some as it requires discipline to saving a certain amount of your income until you have a decent emergency reserve.  If you listen to my show, you know I always stress having a suitable emergency fund at hand as it will prevent a lot of devastating financial mistakes that could hurt you for years. Try to put 20% of every paycheck aside to reach your goal and if you can do this automatically through your bank, so much the better.The second is having a backup plan, taking steps to ensure that you have the confidence, skills, and grit to handle sudden financial challenges which may require more than a monetary solution.Both strategies avoid resorting to credit cards and other types of borrowing in order to stay prepared ahead of time.Emergency Fund: How Large and How to Save for It So, just how much is enough for an emergency fund?  There is a lot of advice out there.  For starters, you'll want to know how to figure how much money needs to be set aside, and, of course, how you'll implement the plan to reach that goal.Many financial planners recommend setting aside at least six months of income into an emergency fund, sometimes up to nine months if you're a freelancer or your work is seasonal or irregular.  This holds true even if you're eligible for unemployment insurance.  Unemployment insurance can be immensely helpful in allowing you to leave your rainy-day fund more or less intact.Health insurance is a huge topic in its own right, but knowing what your deductibles are will give you a ballpark idea of how much cash you'll need on hand in case you have a medical emergency.If your deductibles are high, talk with a financial advisor or someone from your human resources department about health savings accounts.  These can make a real difference by alleviating a cash cr...

2017 Stock Market Predictions: Part I

With Annell Danczyk and Brian Lazorishak, Senior Portfolio Managers at Stack Financial Management2017 Stock Market PredictionsSteve welcomes Annell Danczyk and Brian Lazorishak, senior portfolio managers for Stack Financial Management, to discuss their 2017 stock market predictions and analysis of the economy, global financial news, interest rates, and other factors affecting markets.   Brian is a CMT (Chartered Market Technician) amongst other credentials, and both Brian and Annell are Chartered Financial Analysts.   Given their backgrounds and their focus on “safety first” and “asset protection” investing strategies, it should come as no surprise that Brain and Annell approach portfolio management with a blend of valuation analysis, “growth at a reasonable price” stock picking, dividends analysis, and technical trading analysis.  Both of our guests utilize and contribute to InvesTech Research, a sister company to Stack Financial which compiles decade’s worth of market data and information on individual companies, executes a variety of analyses, and shares findings independently of the big Wall Street brokerages.Because it might be useful for many of our readers, we offer here a simplified overview of terms and concepts describing the different strategies mentioned above:Valuation analysis at its most basic involves the study of Price / Earnings ratios and companies' internal financial health.  The goal is to find undervalued stocks and buy and hold them for the longer-term.  The “growth at a reasonable price” framework looks for companies with competitive advantages and superior profitability, usually smaller cap stocks that trade with higher than average volatility (beta).  Dividends analysis identifies stocks with the best dividend yields or those with strong historical dividend growth.  Technical trading uses charts and data to model and predict market movements and trends. 2016 Markets Review The conversation begins with an overview of the stock market's performance in 2016, and its strong finish after a rocky start and relatively volatile pattern much of the year.  Markets seemed to shake off potentially disruptive news stories, in the form of the Brexit vote and Donald Trump's surprise win, without much trouble.  Annell notes that markets tend to dislike uncertainty, and, in both of the cases just mentioned, markets ticked up after a perception settled in that those events were resolved, at least for the short term.P/E Ratios and Advance-Decline LinesSteve asks about rising P/E ratios—as reflected in the trusted Shiller PE index, among others—and what that might tell us about the ongoing bull market.  Brian agrees that valuations are historically high, noting that 90 years of S&P performance shows that P/E ratios are in the top 10% all-time and even higher (top 3%) if the late 90s tech bubble and 2008 financial crisis are excluded.   This fact alone implies higher risk levels.   He qualifies this unnerving data by claiming that high P/E ratios are not sufficient to stop a bull market.Annell talks about how they pay attention to performance across a breadth of stocks, not just a basket of highly capitalized names that the well-known indexes favor—thanks to their being “capitalization weighted” which inflates the importance of large-cap stocks.  One key indicator of this breadth is the so-called “advance-decline line”, which as the name suggests, compares the number of stocks of all capitalization levels that have risen to the number that have declined on any given day.  This ratio demonstrates when a market rise or decline is broadly shared by a majority of stocks or if it is being led up or down by a small number of over-or-under-performing stocks.

The Modern Entrepreneur’s Handbook

With Michael Palumbo, trader, entrepreneur, venture capitalist, and author of Calculated Risk: The Modern Entrepreneur's HandbookMichael Palumbo and the Modern Entrepreneur's HandbookSteve welcomes guest Michael Palumbo to today's show.  Palumbo has been variously a trader, a venture capitalist, an entrepreneur, and an author. He recently published a fascinating, useful, and concise book entitled Calculated Risk: The Modern Entrepreneur's Handbook.   Michael's impressive resume includes, among other accomplishments, launching Third Millennium Trading at the Chicago Board of Options Exchange, a company he started for $250,000 which was valued at $100 million just 10 years later.  He also found success as an angel investor in a financial tech startup which grew to a $1.7 billion dollar business.  Michael joins Steve today to talk about what makes successful companies thrive while their competitors fade, checklists that entrepreneurs launching new companies should consider (as well as the investors evaluating them) and how entrepreneurs can value their own companies the way that venture capitalists do.New Company ChecklistsThe conversation begins with a discussion of some of the aforementioned checklists which Michael believes can help entrepreneurs and investors better understand a company's prospects.  These checklists apply both to the value of the core idea or ideas underpinning the business (its main products or services) and also to the execution of a plan to bring these ideas to market.  The first checklist is the “geography test,” which looks at the chances that an idea will be likable and find a larger audience of potential buyers beyond the company's local market.  It's a fairly simple test that attempts to assess whether an idea is going to catch on and help the company grow.  Steve asks Michael to give an example of a company that started small and then realized its potential for “scalability” and executed on that.  Michael opines that Amazon is a perfect example of this kind of company, and marvels that they have grown from a bookseller to become the largest retailer in the world.The next checklist has to do with “feasibility,” which Michael explains as having to do with the question of whether current technology can provide support for the product and enable it to sell.  This leads to some interesting speculations about internet companies from the late 90s that did not survive the tech bust of 2000.   Michael asserts that some of these companies had solid ideas but were simply too early in their entrance to consumer markets.  Because dial-up internet was far slower in those days, creating a compelling user experience on the web based on their ideas was simply impossible.  It's fascinating to think of how some notorious failed “web 1.0” companies might have become great successes if they had only waited 5 or 6 years before launching. This thought experiment illustrates the principle of feasibility and the dangers of mismatches between great ideas and the technological environments needed to realize them.People More Important than Ideas: Management and SalesDemonstrating his background as a venture capitalist with expertise at evaluating startups, Michael makes a compelling case that the founders, management, and sales talent at new companies deserve to be treated as critical checklists of their own.

Why Home Sale Agreements Are Failing

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLHome Sale Agreement Cancellations Higher in 2016 During the past year, home sale agreements failed at higher rates throughout the country.  According to Trulia data, home sale agreements in 2016 fell through at a rate of 3.9%, twice the clip of 2015.  This is a very broad phenomenon, which is being seen in different price categories, and in 96 of the top 100 largest metro areas.  Steve and Terry try to get to the bottom of this troubling trend or, at least, to shed some light on some of the common scenarios which lead to sale agreements being canceled.First-time Home Buyers and FHA MortgagesTerry notes that many of these home purchase agreement cancellations are occurring with first-time buyers who have (or believe they have) a pre-approved mortgage but end up being denied a loan.  To some extent, this stems from the type of houses that first-time buyers are trying to purchase: relatively older properties that often need repairs to pass inspections.  Newer homes offer a more straightforward transaction, but they tend to cost more.  In competitive, appreciating markets, this problem is exacerbated by the fact that many homes on the market are attracting multiple would-be buyers, thereby driving up bids.  First-time buyers with minimal cash for a down payment—sometimes as low as 3%—are stretching their budget by raising their bids, and this puts them in a riskier position as far as being able to afford higher mortgage payments and expensive repairs.  The FHA (Federal Housing Administration) which underwrites many first-time buyer mortgages is balking at closing these loans for over-extended buyers, even when those buyers have been pre-approved.  In many cases, buyers have gone through the process of signing a purchase agreement and have made a deposit, only to find out days later that their mortgage request has been denied.  This, of course, impacts sellers and makes their lives more complicated as they have to change the status of their homes from pending back to “for sale,” and perhaps renegotiate with other bidders, if there were any.FHA Appraisals & Failures to Close SalesOne of the most important factors driving these types of broken sales agreements—aside from the FHA's risk-aversion towards low down payment buyers—is the stringent and, at times, seemingly arbitrary way the FHA performs appraisals.  FHA appraisers approach their work a bit differently than other appraisers and their criteria are different.  Terry describes a couple of examples of FHA appraisers somewhat high-handed approach: they require that homes in Florida have a working heating system, and also flatly reject properties with window air conditioning units.  Perhaps these policies can only be chalked up to bureaucratic rigidity, but, unfortunately, for many would-be home buyers, they have real world consequences.  When you combine these kinds of policies with the repairs needed on older homes priced within their budget, first-time buyers are really taking it on the chin.  If the seller refuses to pay to fix issues, which the appraiser docked the home price for, and the buyer can't afford to make those repairs on their own dime, the agreement will most likely fall through.Another area of complexity attributable to appraisals has to do with a fairly common scenario in which an appraisal of the value of a home for sale comes in significantly less than an offer which has already been accepted.  This happens more often in neighborhoods where home prices are rising because appraisals look backward at historic sales of “comps” (comparable properties) in the same neighborhood.  If there haven't been many recent sales, a conservative appraisal will usually come in lower than the offers, especially if there have been multiple competing bids driving up the sale pri...

2017 Stock Market Predictions: Part II

With Annell Danczyk and Brian Lazorishak, Senior Portfolio Managers at Stack Financial ManagementPicking Individual Stocks for Stock Market 2017For the second part of their discussion, Steve turns to stock picking strategies and the research which support it.  Having defined “valuation analysis” and “growth at a reasonable price” as two poles on the strategy continuum, for the purposes of argument, Steve asks Brian and Annell to elaborate on their approach.  Annell admits to a bias towards “growth at a reasonable price” overvaluation, though she adds that “asset protection” remains a cornerstone as well.   “Asset protection” is achieved by maintaining a “cash buffer” and shifting portfolio allocations to follow market cycles.By way of a quick overview of “growth at a reasonable price”, Brian outlines an analytical lens which rates the competitive advantages, superior profitability, and financial strength of individual companies.   Companies with intrinsic competitive advantages are more profitable in the long run and pass those profits on as dividend returns as well as capital appreciation.   Brian views valuation—again, P/E, or stock price relative to earnings—as a kind of “built-in protection” against price declines.  He nuances this observation to say that, in his approach, the idea is not to find the cheapest, most undervalued stocks so much as it is to pass on highly valued companies with less upside to their equity.Index Funds and Asset ProtectionSteve brings up the question of index funds, noting that while he often recommends them to clients, he also feels that investors won't find much reassurance that they own quality companies during a market downturn.  Brian expands on this, asserting that a well thought out selection of individual stocks can preserve assets better in a market downturn.  He agrees that index funds are widely and legitimately used by many private investors as well as fund managers, but qualifies this by arguing that, to some degree, a passive instrument like an index fund looks better during a bull market than it will over the course of multiple market cycles.Finally, Steve wraps up the conversation by turning to interest rates and inflation.   The Federal Reserve raised the Fed Fund rate by 0.25% at the end of 2016, and the yield on longer-term bonds moved up accordingly.   Steve wonders whether the rate hikes, along with possibly large economic stimulus in the form of infrastructure programs launched by the new Administration, will add to inflationary pressures.  Brian replies that he sees inflation largely under control for the moment but admits that pre-inflation factors like wage growth and a tighter job market could foreshadow more rapid inflation.  He asserts that the Fed will feel pressed to “normalize” (increase) rates if they detect an increase in inflationary signals.Annell and Brian will be speaking together at the MoneyShow Orlando on February 9th: Is a Bear Market Looming in 2017: Where to Watch  and February 10th: The Worst & The Best: Where to Survive & Thrive in the Next Bear Market.Steve will be speaking on February 10th: Myth Busting Your Way to Riches.For more information on the MoneyShow Orlando and to register for free, click here.Click here for Part I 

What’s Next For Consumers After Macy’s And Sears Closing?

I’m sure by now you’ve heard about Macy’s and Sears closing their doors left and right.  First announced last summer, we now have the official list of the 68 Macy’s stores closing and the grim news of more than 10,000 employees being laid off.Sears has also found itself in the same boat, mounting losses of 150 Sears and Kmarts to be closed or sold.American malls, in general, have been struggling to stay relevant and profitable while online shopping becomes more and more prevalent.Kohl’s, for example, has been reporting weak in-store sales with many looking to make it up this holiday and failing to do so due to the undeniable convenience of online shopping and delivery.So, to what extent are Macy’s and Sears in trouble?  How bad is it?  And what does that mean to you?Macy's and Sears have triggered losses in their stock prices with underlying problems that have been building for some time.Macy's has consistently been losing money for the past two years, while Sears scraped a new low by losing almost $750 million in one quarter.Sears was more or less forced to sell its Craftsman Line to Black and Decker for $775 million in an attempt to make up the negative numbers.Lost revenues will hurt Macy's bottom line to the tune of $575 million in the short term, although they expect to save $550 million from the closed stores going forward.According to their current CEO who is leaving the firm, "We are closing locations that are unproductive or are no longer robust shopping destinations … as well as monetizing locations with highly valued real estate”.So, what does that mean?  It means people are getting laid off and both Macy’s and Sears are attempting to sell their stores to make up for some of the loss.Their plans also include investing substantial amounts in their online presence (I wonder what took them so long!) and developing new store concepts, such as expanding “stand-alones” like Macy’s Bluemercury beauty shops.Now, interestingly, Bloomingdale's (also owned by Macy's) is doing ok, so they are expecting to open some new international Bloomingdale's locations.Declining Foot Traffic at Macy'sDespite Macy’s ambitious plans for restructuring, CEO Lundgren doesn’t deny that things aren’t looking great.  As we all know just from going into either Sears or Macy’s, the stores have been empty and in disarray for some time.  The products are disorganized and everything appears to be on clearance. Just walking around to browse is rather unsettling.  Even the flagship stores have been neglected.Growth of Online Retail Eclipses Brick and Mortar SalesSo, what’s next?  Are the day of department stores over, with nothing but doom and gloom when you walk in?Everyone, including your grandparents, probably know by now that online shopping is a great way to get deals and find less common products (first editions of Harry Potter, anyone?), not to mention avoiding all that parking lot traffic.Amazon has revolutionized into a magical place where you can buy just about anything you can imagine and that’s become a fact that is now universally known.  The fact that this has long been taking a toll on brick-and-mortar mom and pops and large chains alike should come as no surprise.Even though many of us don't like the idea of hurting local businesses, it’s now become a struggle between convenience vs tradition.While I’m paraphrasing, extensive data backs up the prevailing trends of online sales growth which, unfortunately, comes at a great cost to traditional retailers, who have been closing their doors more and more.  It also explains a good deal about why Macy's and Sea...

Trumponomics 101: What A Trump Stock Market Looks Like So Far

With John Thomas, AKA the Mad Hedge Fund Trader Guest John Thomas is a hedge fund manager and finance blogger who has dubbed himself the “Mad Hedge Fund Trader”, a title that may surprise you if you actually look at his resume and credentials, both of which are impressive: He founded and later sold the first international hedge fund and was a member of White House press corps in the 1980s, to name two highlights.   Steve opens their wide-ranging conversation by asking whether it's true that hedge fund managers—perhaps emulating a strategy used by some of the all-time great investors—often seek out assets that are mispriced.  John agrees that, indeed, this principle is the “bread and butter” of fund managers and financial advisors.  He adds that his fund tries to buy cheap assets and sell (short) expensive ones, a simple principle that unsurprisingly isn't as easy as it sounds.Stock Market 2017 Forecast and Trumponomics Diving deeper into John's recent writing and investment moves, he explains that he correctly foresaw that tech companies' stock prices would get, as he puts it, “absolutely trashed” in the immediate aftermath of Trump's election victory.  The reasons he expected this short-term fall had to do with the well-publicized lack of love—politically speaking—between Silicon Valley and the President-Elect, and market anticipation that highly globalized tech companies could face strong headwinds from Trump's anti-globalization, anti-immigration, pro-tariff stances.  While tech stocks have rebounded, John pocketed some nice returns from his foresight and quick trades.  In fact, he's still bearish on the tech sector until Trump makes clear whether he intends, in John's words, to “pursue his anti-globalization fantasies” of 35% – 45% import duties for Mexico and China.  John is convinced that such reckless protectionism could lead to grave results for the US and world economies, setting up Trump to become a modern Herbert Hoover, the US president who led the country into the Great Depression.  On the plus side, he doesn't think that Trump will stick to these policies if it becomes apparent that they are sending markets into a tailspin.  He goes further and remarks that if Trump's economic plans begin to tank US markets, this would offer a golden opportunity to “buy the dip” on the assumption that Trump will rather quickly come to his senses.  Convinced that most investors will take a pass on buying into a sharp move down in stock prices, John observes that volatility and mispricing becomes more pronounced in bear markets.  Using the examples of Apple (low P/E ratio, underpriced) and Kimberly-Clark, the toilet paper manufacturer (higher P/E ratio, overpriced), John explains how investors flee to “safer” yet arguably overpriced companies—in this case, toilet paper instead of tech—and, in the process, create more opportunities for funds like his own to jump on mispriced equities.In an interesting sort of sidebar to the main conversation, Steve and John discuss the curious situation of federal tax revenues and spending on the state level.  Both the East and West Coasts pay into the tax system more than they get back from it in terms of federal spending, while states in the Midwest and Deep South—strongholds of Trump's supporters—reap more than they put into Federal coffers.  This is ironic given that many of these folks say they want to dramatically shrink the size of government, apparently not understanding the benefits they receive from military, infrastructure, and entitlement spending.  Alaska may be the ultimate example of this irony, as their libertarian politicians vent about an overlarge federal government and brag about their fiscal independence while they receive $7 in federal spending per dollar of tax revenue.US Politics and Markets Overlap: Lessons from History

5 Simple Steps To Teaching Kids About Money

Healthy money habits to teach your kidsIt’s never too early to start teaching your children healthy habits and that includes financial ones. From an early age, children begin to observe their parents in all areas of life, including their spending and saving and how they talk about money. Kids pick up on our attitudes about money just by watching us. So grab this opportunity to inculcate healthy financial habits at a young age and help your kids become financially wise adults. Teaching kids about money is probably not as hard as you think, for them or for you—just use your everyday experiences with them to instill financial awareness. The first two money habits I plan to talk about can apply to very young children, while the last three are probably best with children aged 8 and up.* Model good financial behaviorChildren watch their parents and replicate many of their habits. So take a second and think about your “money behavior” when your children are around and reflect on what you think they may be learning from you about money.Are you mindful of your spending around your children? Are you and your partner always getting the newest gadgets, cars, or items for the house? Do you eat out a lot as a family? If you’ve answered yes to one or both of those questions, your children are likely to develop an “I want it, I can have it” financial attitude, which could lead to some pretty painful financial mistakes, mistakes like racking up heavy credit card bills to satisfy their need for instant gratification.  Clearly, this is the wrong approach—misleading by example, you might say—to teaching kids about money.  Instead, practice shopping on a budget, using coupons at the grocery store, and making home-cooked meals early on. Even if your children are young, they notice these things and will learn to value money. In fact, I, for one, am a big fan of value-for-money in a lot of my purchasing and spending decisions, such as, for example, buying high quality food even at a higher cost and cooking nutritious meals at home instead of going out for less healthy and more expensive dining options.* Make them wait to buy things they wantLearning how to delay gratification is a much-needed skill in today’s “have it now” society. Teach your children that when they go to the store with you, they don’t always get to leave with something. If they can’t stop talking about that new toy they want, tell them they can ask for it for their birthday or Christmas or let them earn money by helping out with chores around the house.Through this, kids will learn “discipline with spending”, and that they don’t always get to buy something when they want it. Once they start bringing home their own paychecks, this delayed gratification will help them stretch their paychecks through the month.The two points I just spoke about are money habits you should start practicing from the day your child is born. The next three are perhaps better saved until your kids are about eight years old and have a clearer sense of the world around them.* Kids savings accounts: teach them to save for the long-termKids savings accounts are a smart way to get them involved with managing money at a young age.  One of the best approaches to teaching kids about money and saving is with the “rule of thirds.” When your children get an allowance or money for their birthday, have them put one-third into a long-term savings account like a 529 college savings account and one-third into a savings account for a bigger purchase like a bike or an iPhone—something expensive that they really want. For the final third, give them the option of doing what they wish with it; let them spend it immediately if they want or let them, of their own volition, stash part of the last third into additional savings.Moreover, to reinforce this and to introduce them to day-to-day financial transactio...

Will Mortgage Rates In 2017 Go Up, Down, Or Stay Flat?

With Greg McBride, Senior Vice President & Chief Financial Analyst for Bankrate.comMortgage Rates in 2017: Are they Heading Up, Down, or Flat? Greg McBride, Chief Financial Analyst at Bankrate.com, returns to On the Money today to talk about mortgage rates, the federal funds rate, housing markets, and the economy, in general, and where they all might be headed in 2017.   Naturally, Greg is an expert on these and other topics, and we're lucky to have him here to share his insights and expectations about the coming year.Before turning towards a more forward-looking trends analysis (including Greg's forecast for mortgage rates in 2017), the conversation begins with a look at mortgage rates and the Federal Reserve's modest rate hike at the end of 2016.  On December 14, 2016, the Fed raised the overnight “federal funds rates” by 0.25%—only the second of such raises in almost a decade.  This immediately caused a larger spike in rates (aka yields) on 10-year notes and 30-year bonds and this, in turn, elevated mortgage rates, which are tied to these longer-term government securities.  Building on a rise that started in October, mortgage rates ended the year up 0.75%, an increase that has inflicted a certain amount of pain on potential home buyers.  Granted, this is coming on the heels of summer mortgage rates that scraped record lows of 3.5%, so, in that context, the Q4 rise is not a major game changer.Trump and the Prospect of Fiscal Stimulus and Rate InflationGreg notes how unusual and, indeed, how unprecedented it was that every week in Q4 2016 saw mortgage rates creep up (except for one week when rates were flat).  Steve wonders whether this might be evidence of an “inflection point”, where a short-term trend becomes a long one.  It's important to recall that mortgage rates were rising before the fed funds rate change, and Greg attributes this, in large part, to an expectation that Trump will follow through on his promises to cut taxes and invest in large-scale infrastructure spending.  These stimulus programs, if and when they arrive, should accelerate economic growth (GDP), add heat to an already strong stock market, and add to inflationary pressures.  This would also shift bond prices lower and yields higher on all securities including mortgage rates in 2017.Despite these rumblings of higher rates fueled by economic expansion, Greg is optimistic about where mortgage rates are headed in both the short term and for the remainder of 2017.  He points out that rates have pulled back slightly already in 2017 (from 4.3% to 4.2%) and expects that they will bounce around the 4-4.5% range for the foreseeable future.  He also expects that any correction in stock markets, international financial crisis, or a broader downturn in GDP will drive mortgage rates lower.  This is because, reacting to fear of falling asset prices in a so-called “flight to safety”, investors will rotate out of stocks and other equities and into bonds.  Higher demand for and thus prices of bonds leads to lower yields and hence cheaper mortgages.  This could present an opportunity for buyers to lock in rates under 4% and for homeowners to refinance at those rates as well.Treasuries Rates and Deeper Economic TrendsGreg makes a case that the bulk of the rise in interest rates has already been priced in by the market.  Looking deeper into the dynamics shaping the economy, he sees volatility emerging from conflicting trends: on the one hand, fiscal stimulus, and, on the other, weak productivity gains and an aging population.  The uneven growth that would result from these conflicts is not a departure from the pattern over the last few years.  As we've seen in the recent past, Greg expects mortgage rates to continue bouncing up and down.  In fact, he takes a step beyond this mixed forecast and states that he think...

Why Owning A Home Is The Foundation To Financial Security

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLHouse Appreciation Continues Apace in 2016 in Many MarketsOn this week's Real Estate Round-up, Boca Raton real estate agent Terry Story and Steve discuss house appreciation and the benefits of home ownership.  2016 has sustained the multi-year trend of house appreciation in many housing markets throughout the country.  Terry cites mortgage giant Freddie Mac's MiMi index (Multi-indicator Market Index) most recent reading as a reliable predictor that certain local markets—and to a lesser degree, broader markets—have yet to peak and, in fact, enjoy significant room for further appreciation.  With this as yet untapped potential upside, home equity is expected to grow, offering homeowners the option of opening home equity lines of credit for, among other things, home improvement projects.  Terry and Steve delve into state-level MiMi data which highlight which state housing markets have improved and which could have further house appreciation in the pipeline.Benefits of Owning a HomeThis last point provides a nice segue way into the next topic of conversation: the benefits of homeownership.  Terry walks Steve through her top 10 reasons for owning instead of renting a home.  Among these, the certainty of your monthly costs (outside of insurance and taxes) ranks at the top, as mortgage payments are fixed while rental rates are not.  Number two on Terry's list is house appreciation, which she admits is not guaranteed in the short term, but almost always is over the long haul.  Another big advantage of owning a home is the freedom to make renovations to the house and property.Some of the other reasons Terry cites include overall lower cost of maintaining the property, tax benefits, building equity in the home (which amounts to a “rainy day fund” savings account that can be utilized through a home equity loan) and the benefits of living in a community of fellow homeowners.  Rounding out the list, Terry asserts that the advantages of home ownership in terms of retirement security is very compelling.  Owning a home offers a nest egg which can be sold—often at a significant gain—to fund one's needs for retirement income.

The 12 Most Vital Insights From The World’s Top Investors

Twelve Key Insights from the World’s Top InvestorsOn one of my recent commentaries, I spoke about Howard Marks and shared some of his investing philosophies with you. Today, I want to share 12 key insights that are commonly shared by the 99 top investors in the world… but, first, let me give you some background.Magnus Angenfelt is a retired hedge fund manager and financial journalist from Sweden who recently wrote a book titled The World’s 99 Greatest Investors: The Secret of Success where he looks at the top 99 investors by highest absolute returns irrespective of investment style. His list includes some names you know and many you likely do not—folks such as John Bogle, Warren Buffett, Leon Cooperman, Ken Fisher, Mario Gabelli, Carl Icahn, Mark Mobius, Julian Robertson, George Soros, David Tepper, Paul Tudor Jones, Martin Zweig and more.Angenfelt says, on average, his chosen 99 most successful investors outperformed the market by about 12 percentage points each year for 25 years.Investing Styles of the Most Successful InvestorsIn the top 99, investing styles vary quite a bit, from value investing to speculating to quantitative-based trading. More than half of the top 99 are from the U.S. and, of these, about half are value investors who buy good stocks when they are marked down.But his list does not include prominent investors such as bond king Bill Gross of PIMCO simply because, as Angenfelt puts it, neither Gross nor any other investor who solely focuses on bonds made the cut because their returns are simply too poor, relative to returns from equity investments.The list has no women either, again, simply because no women made the cut purely on returns delivered over 25 years, even though the author names women investors such as Susan Byrne of Westwood Management who has produced better returns than many men—but not enough to qualify in the top 99.12 Insights from World's Top InvestorsAnd one of my favorite investment websites, gurufocus.com, compiled a list of Angenfelt’s top 12 insights that were common to almost all of the top 99. Here’s the list:* Be true to yourself. As Guy Spier, a Harvard-trained investor puts it, “My job is to be Guy Spier. I’m not going to do a very good job of beingBill Ackmanor Warren Buffett, but I’m going to do a damned good job of being Guy Spier, better than anybody on the planet. Everybody’s path is unique and I think it’s really, really important that we find our own path.”* Know your strengths and weaknesses.* Consider the risks, not the potential. This one goes back to Howard Marks’ comment on playing “not loser’s tennis,” which is basically about focusing on the risks as much as on the rewards so you avoid loss-making investments.* Be prepared to change your strategy if the market changes.This is a key insight—a lot changes over a 25-year period. Just compare, for example, our world and lifestyle in 1989 to where we are today in 2014. Much has changed. So, these top 99 investors have been very adept at keeping their ears to the ground for seismic changes in the investing landscape and making moves ahead of others to deliver outstanding returns… without being stuck to rigid strategies, while also being core to their fundamental approach to investing. For example, Buffett was a value investor then and is a value investor now, but he has changed his strategy over the years— from small businesses to big businesses, from domestic-only to international, and from non-tech to selectively tech. So, markets evolve and great investors evolve with them.* Don’t invest on the basis of tips. I think many individual investors are fairly shallow on due diligence and tend to implicitly p...

Increase Your Down-Payment With REX Agreements

With Terry Story, a 28-year veteran with Coldwell Banker located in Boca Raton, FLTerry Story joins Steve for their weekly confab about the latest news from real estate markets.  This week they discuss REX agreements, a new program pioneered by the FirstREX company which allows first-time home buyers to borrow money towards increasing their initial down payment, which in turn has a number of advantages for buyers, and, of course, some advantages for lenders as well.  They then turn their attention to rising eviction rates in rental markets around the country.  The trend is alarming to many, not least of which are renters in locales where home prices continue to gain altitude.  Finally, Steve and Terry discuss the often thorny pre-closing negotiations between home sellers and buyers over required disclosures, inspections, and the cost of repairs.REX Agreement Benefits for Buyers and Lenders As Story explains, REX agreements have taken off in the past few years as a popular way for cash-strapped home buyers to borrow funds to apply towards the down payment portion of their mortgage.  Instead of offering a 10% down payment, a REX agreement can provide the cash to increase that to 20% of the property's price.  This enables buyers to sidestep the private mortgage insurance program they would otherwise have to pay into, a decent savings in and of itself.  It also frees up funds for the buyer to make improvements to their new home, which naturally has knock-on benefits for other industries. The REX homebuyer program (underpinned by the REX agreement between homebuyer and lender) is not only offered without an accompanying annual interest rate, it also defers repayment of the loan until the house is re-sold.  Instead of a steady stream of income, the down payment lender takes an equity position in the home which is only actualized when the home is sold again or when the mortgage is paid off. The lender, in most cases, does ultimately get paid more than their initial loan, but that amount floats depending on the home's appreciation.  These REX agreements are not without risk for the lender, which is why they tend to get made more often in local markets which are seen to have good long-term prospects for stable and rising home prices.Rising Rents + Stagnant Income = Higher Rental EvictionsNext, Terry turns our attention to an unsettling and broad-based trend in rental markets: spiking eviction rates.  The fundamental problem is a disconnect between rising rents— up 66% since 2001—and a much more modest rise in income—around 35%.  A huge number of renters are paying a greater portion of their income, the so-called “housing burden,” towards rent.  This, of course, puts many renters in a more vulnerable position, perhaps one expensive medical bill or job loss away from eviction and possibly homelessness.Disclosures, Inspections & RepairsWrapping up this week's conversation, Steve and Terry talk about negotiations between home sellers and buyers on issues related to required disclosures and inspections and necessary vs. optional repairs. Before closing a home sale, current owners are bound by law to disclose everything they know about problems with the property, a process that goes hand in hand with required inspections. Buyers are then given a window of time to propose repairs to any important issues identified in disclosures or inspections.  Negotiations can break down and even threaten the closing if both sides are unable to come to an agreement on what needs to be fixed and how much it should cost.  Terry mentions a novel approach to resolving some of these disagreements: Instead of renegotiating the sale price, or delaying the close until all repairs are complete and re-inspected, a seller might offer a “monetary credit” to the buyer, which the latter can then use to address repairs on their own time.

The Author Of Forrest Gump Discusses Publishing In 2017

With Winston Groom, an American novelist and non-fiction writer best known for his book Forrest GumpForrest Gump author, Winston GroomWinston Groom is a prolific writer of both fiction and non-fiction books, best known for his unforgettable portrait of an American eccentric: Forrest Gump.  One might say that Groom instantly broke the mold with the character of Forrest Gump, an honest, good-hearted, and somewhat child-like man whose life is propelled by historical currents and a romantic storyline far from his small town Southern roots.  The story of a man who seems guided more by his innocence and loyalty than his intellect and ambition, whose adventures humorously revealed his steadfast love of home and country and a naive trust in the kindness of strangers, the movie Forrest Gump captured the imagination of Americans and continues to be considered a classic and a high point in actor Tom Hanks' career.The Origins of Forrest Gump, an American EccentricWinston is here with us today to discuss the inspiration and development of the novel Forrest Gump, a life in writing and publishing, and his recent work El Paso, among other topics.  Fans of the movie and novel will find insight into Winston's creative process in his re-telling of the humble story that got him started with Forrest Gump – one he heard from a friend of his father's while visiting in his hometown of Mobile, Alabama.  If you've ever wondered what tapping into the muse of inspiration feels like for a writer, Winston describes how he became “an instrument” while writing Forrest Gump, channeling what he calls “the lizard brain” of almost automatic creativity.  He also reminds us that this isn't exactly like normal workaday writing and, in fact, is far closer to the exception than the rule.Winston Groom on the New York publishing industryBy way of many colorful anecdotes, Winston also talks with Steve about his own journey from journalist to book author and his experiences with the maneuvering, deal-making, and the role of various personalities in the publishing and journalism worlds.  Anyone with an interest in having their own work published (his advice? “Make friends in the Hamptons”) or is simply curious about how the industry operates behind-the-scenes will be fascinated by his commentary.El Paso, a historical novel The latter part of the interview delves into his most recent novel, El Paso.  Similar to the hand-me-down origins of Forrest Gump, the backstory Winston provides on the genesis of El Paso is an interesting case of making use of a sort of patchwork quilt of tales borrowed from a friend and remade into a unified narrative.  The story is set in New Mexico in the early 1900s,

Despite The Market’s Rise, It’s The 1% That’s Been Hit Hardest

I just read a very interesting article posted on the website Seeking Alpha written by the Mad Hedge Fund Trader. I  subsequently discovered that the author is John Thomas. According to his bio, Thomas has written for The Economist Magazine and the Financial Times Newspaper, which are two of my favorite reading sources. Having spent 35 years in the investment arena, I can tell when someone knows what he is talking about.So here’s the gist of what he is saying:He asks, “Who has been most hurt by the change in markets after the presidential election?”Is it the liberals, the unions, the environmentalists? Well, it’s not, so he says—it is the 1%.How could that be, you may ask? Don’t the 1% have most of their money in stocks indicating that they would have profited greatly from the big rise in the market?Not so, he suggests. The 1% have the overwhelming share of their wealth parked in the bond market, and with interest rates rising, the value of these bonds have dropped significantly. For those of you who aren’t familiar with the concept of rising interest rates causing bond prices to fall, the idea is straightforward: In order to be able to sell your bond that has a fixed interest rate, the price of the bond has to be adjusted to match the rate on newer bonds issued. If rates rise, a buyer can either buy the new bond at the new prevailing rate or buy a bond with a lower interest rate at a cheaper price. This will compensate the buyer for owning an older bond with a lower rate of interest.So simply stated: As rates rise, bond prices fall.Mr. Thomas states that bond market losses now exceed $1 trillion since Trump gained the presidency, and he posits that the worst is yet to come. Here’s a quote: “If Trump actually implements his vast expansion of the federal deficit, ten-year Treasury bond yields could rocket from 2.42% to 6%, knocking one-third off of bond values”.  As I record today’s show, those 10-year Treasury bond yields he references are actually sitting at 2.6%!—meaning that rates have gone up even further and bond prices have dropped even more.He also goes on to say that there has been a big shift in the make-up of bond market investors.The bond market is heavily owned by the richest segment of the US and Global population. When large wealth was more evenly distributed, the top 1% only accounted for 1% of Treasury bond ownership. Today that figure is closer to 25%.He says that the wealthier families become, the more conservative they are in their investment choices. Their goal shifts from capital appreciation to asset protection.They’re less interested in return on their capital and become obsessed with return of their capital. This is how the rich stay rich, sometimes for centuries, he adds.What this means for the bond market is that these investors never sell. When they buy a 30-year Treasury bond, it is with the expectation of holding it for the full 30-year term maturity.By holding until maturity, they can avoid capital gains tax and only have to pay interest on the coupon payments. Even better, when they die, any taxes deferred from the buildup of the appreciation in the value of their securities gets neutralized due to the rule of the stepped-up cost basis. This means that the value of the securities get a new cost when you die. The new cost will be the value of the securities at the date of death. In other words, if you bought JNJ 30 years ago and, after splits and other things, your cost was $10 per share, the taxes paid at death if your family sold the stock would not be based on the cost to the original owner of $10 per share but on the current price of $115 per share as it is today. The bottom line is that taxes are never really paid.He adds to all of this the fact that 50% of our national debt is owned by foreign investors who also tend to hold paper for its full term.

If This Is A Stock Market Bubble, It Should Be Ashamed

With Michael Batnick, Director of Research at Ritholtz Wealth Management and writer of the blog Theirrelevantinvestor.comLooking Ahead to the 2017 Stock Market: Are We in a Bubble?In my end of year interview with wealth management Director of Research Michael Batnick, we wrap up 2016 by reviewing market movements and looking at winning and losing strategies during this year as well as over longer term bull and bear market cycles.  Wondering where the stock market is going in 2017?   With the bullish trend that's been building steam since this summer—and has really taken off in the past six weeks—are we entering “bubble territory”?  If so, is it a bubble that has spread wealth throughout markets and the economy, or is it, in fact, a bubble that “should be ashamed of itself” as Steve terms it, meaning one that so far has only had limited benefits to the upside, and perhaps ought not to be trusted.   Michael's thoughts on these subjects might surprise you, as even a veteran investor such as he admits that when it comes to timing the market's ups and downs, the unknown factors greatly outweigh the known.Don't Be a “2% Investor”One major takeaway from this conversation concerns the riskiness and overall poor performance of non-professionals attempting to “play the market.”  Michael refers to these do-it-yourselfers as “2% investors” because their average returns over time rarely provide more than a rather anemic 2% return.  The psychology behind the impulse to beat the steady-but-not-spectacular returns provided by managed funds (like mutual funds) is a powerful one, but those that follow it usually find the results disappointing at best.They say hindsight is 20/20, and along those lines, markets can appear more rational or predictable than they really are when looking backward.  The temptation to get in and out of the market, making money and protecting gains by simply following significant trends up or down, seems logical in theory, but in practice, there is a lot of guesswork involved.  Timing even major market changes is far trickier than it might appear to the average observer.As Michael points out, correctly identifying a true bear market is quite difficult in and of itself.  Even when markets shed 10% or more of their value, in the majority of these cases a -30% or -40% bear market does not ensue.  If you've pulled the trigger to sell after a 10% correction, you may be leaving a lot of potential gains on the table.  And for folks who think that selling some or all of their stocks while they are at all-time highs—as they are now, for example—again with the hope of getting a jump on the rest of the market and cashing in capital gains, Michael reminds us that in the history of the stock markets, all-time highs have followed one after another, more or less permanently raising the value of the market over the long haul.  Not only that, but selling stocks means losing out on dividends, and the rewards of buying new stock with those dividends.  The 2017 stock market may or may not continue the bullish trends of the latter part of 2016, but one thing that's certain is that most short-term investors, whether selling or buying, are going to guess wrong on the timing.  It's really just a question of how off was their timing, and how much that cost them.Alternatives to Playing the Stock Market in 2017Michael suggests that picking and timing stocks are, at the end of the day, a fool's errand for most individual investors.  And while for the moment, most indicators seem to be signaling continued gains in the 2017 stock market, if you've got a disproportionate amount of your portfolio invested in stocks, you are exposed to a higher level of risk than is appropriate for most people.

Avoid These Big Money Mistakes Every Generation Makes

Age brings us wisdom and hopefully, keeps us from repeating past mistakes—and that’s great! But age doesn’t always protect us from making mistakes in situations that we haven’t previously encountered.So it is with our money.  Every new stage of life brings new financial strategies we should ideally follow. But at every stage, we find new ways to not follow those strategies, and these money mistakes cause us to lose out and jeopardize our financial security. Moreover, as the economy and demographics change, we can be assured that the mistakes we make will not be static… so the mistakes of current generations aren’t the same missteps that their predecessors struggled to avoid.Here’s a closer look at some of the biggest money mistakes we make, decade by decade, and how to avoid them.20s: Playing it too safeLet’s begin with those of you who are in your 20s. I have often talked about the power of compounding and starting early with investing and saving. The first full decade of adult life—your 20s—should be about investing heavily. Yet, numerous studies show that today’s 20-somethings just do not take enough risks with investments to build up big returns.For example, a 2016 study found that millennials tended to favor retirement accounts with little stock and more guaranteed income, choices that would bring skimpy returns over time. When asked why they chose such a conservative portfolio, participants said things such as, “I honestly know nothing about money right now,” and explained that a portfolio with a lower risk level seemed like the “best option.”A majority of these millennials were selecting retirement portfolios more appropriate for employees nearing retirement, rather than those starting their careers. The best way to counter this classic money mistake is to recognize this as what we call “risk aversion” and, by knowing it, avoid it. So, instead of taking on the riskiest financial investments, millennials should look at options such as target-date funds, which start out with riskier allocations that gradually become more conservative.30s: Overwhelmed by ComplexityMore so than in previous generations, today’s 30-year-olds start making huge adult commitments such as getting married, having children, or buying a house.Yet many go into that situation with heightened expectations and think they are entitled to the same standard of living they had when they left their parents’ homes for college and career.But what 30-somethings forget is that it took their parents decades to build up to that stage. And their quest to replicate that lifestyle too early often leads to splurging on things like trying to live too large and beyond their means, which often leads to excess credit-card debt and excess spending, instead of saving, which means they miss out on the 8th wonder of the world: compounding interest. It would be wise for 30-somethings to focus on living prudently, saving, investing, and building up their nest eggs.40s: Misjudging big expensesBy our 40s, we tend to be about halfway through our working lives, just as bigger expenses enter the picture. Two of these, in particular, can be rife with error: the house and the children.Many people spend too much on buying a home, often disproportionately more than they can afford, and then don’t work aggressively enough to pay off their mortgages. A bigger home comes with a bigger mortgage, higher property taxes, and higher maintenance and utility bills. You end up saving much less than you could, which can lead to less-than-optimal income in retirement because your nest egg suffers.What you want to do instead is to ask yourself, “When do I want my mortgage paid off?” If you’re 40 and buy a big house, your 30-year mortgage isn’t going to be paid off until you’re 70. So even in retirement, when you may not have any income coming in, you may be forced to work just so you can keep your hou...

Living Large In A Tiny Way

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLLiving small in all the right placesOur resident real estate expert, Terry Story, is talking small this week—but in a very big way. It seems that there is a surge of interest in some parts of the country for tiny houses, houses no bigger than 200-300 square feet. In Spur, Texas, for example, an entire community of these Lilliputian homes is sprouting up, costing on average of from $30,00 to 50,000. Although these homes are illegal in some parts of the country, in Florida, Colorado, and Texas, people are going for them in large numbers.The size and other relative characteristics, such as these mini-homes being either on wheels or on a solid foundation, may not seem so different from traditional mobile homes that have been around for a long time now. Whatever the comparison, these new super-down-sized dwellings which offer only three essentials— kitchen, bathroom, and bedroom—are an up and coming phenomenon in the housing industry.  How better to simply your life than by going tiny?Before you sell your home, know the lucky numbers.Lucky 8s, unlucky 13, or is it number 4? When it comes to listing your home for sale, it turns out that the listing number is very important.  We all know that the number 13 is perceived to be an unlucky number for most people here in the U.S., however, within Chinese communities, it’s the number 4 that’s to be avoided. So, if you have a home to sell in Los Angeles, San Francisco, or New York, you’d do well to list your home with as many 8s as possible since that’s the most desirable number within the Chinese culture. Realtor.com, who conducted the research for all this, conceded that in reality, of 178 homes that popped up on listings that included multiples 8s, they only sold about 0.32% faster than other listings.The Trump EffectWhether you are buying large or small and no matter what you consider your lucky number, the new administration that will soon be taking over our government will have the greatest impact on the housing market.As far as the South Florida housing market is concerned, Terry believes that if Trump follows through on his promisesto lower taxes and to increase jobs and infrastructure the housing market will indeed benefit, even though rising interest rates will hamper the ability of some to make new housing purchases.The anticipation of faster growth in 2017 is one of the reasons the stock market has been on the rise, but this growth could also bring on inflation which will have its own impact on housing across the country.Terry reminds us that we’re pretty much at the peak of a 10-year cycle, one that rose up after the 2008 market downturn and, although it won’t happen overnight, the movement will slide downward at some pointTerry’s best advice: Buy what you can afford and don’t overreach just because we’re in a positive cycle because—we all know that what goes up does eventually come down.

17 Ways To Earn Extra Cash For Your Holiday Spending

With Bob Niedt, Online Editor at Kiplinger.comThe holidays might be the most wonderful time of the year, but it’s also the most expensive. It’s when most of us are wishing we had more to spend on presents, entertaining, or simply to pay off those end of year bills.Award-winning journalist and Online Editor at Kiplinger.com, Bob Niedt wrote an article listing 17 ways—beyond setting up a lemonade stand—to generate extra cash for your holiday spending.* Sell unwanted electronics: Check on Gamestop.com, com, Nextworth.com, and Usell.com for ways to sell your smartphones, tablets, game consoles, video games, textbooks. Shipping is free with all of these sites.* Search for unclaimed property: Anyone can search a state’s unclaimed property database through naupa.org or missingmoney.com. You might discover uncollected insurance benefits, utility deposits, or an unclaimed inheritance.* Adjust your tax withholding: If you’re one of the lucky ones who received a tax refund for 2015, you can go to HR and adjust your withholding so that your take home pay rises. Kiplinger offers an easy-to-use withholding calculator.* Tutor or teach: Explore sites such as Wyzant.com and Tutor.com or check with social media sites for areas matching your skills and expertise. Various staffing firms across the country post positions for substitute teachers and other educational staffing positions.* Be a tour guide: Check out the travel guide site Vayable.com and your local places of historic interest which attract more visitors during the holidays.* Get paid for your opinions: You can participate in an in-person focus group such as those run by Focus Pointe Global or take online and phone surveys for the Harris Poll and Inspired Opinions. In addition, you can be an “online juror” at Ejury.com and Onlineverdict.com.* Sell gently worn clothing: Take your used clothing and accessories to local consignment shops, sell online at thredup.com and Therealreal.com, or set up your own account on Ebay.com.* Join a street team: Companies such as Street Team Promotion need helpers to promote films, products, and events by handing out samples or waving signs.* Babysit: Be a nanny or babysitter by placing a listing on sites such as Care.com and sittercity.com, or do it the old-fashioned way by putting the word out with your friends and neighbors.* Sell excess furniture: Take your used furniture and home accessories to a local consignment shop, advertise on Craigslist, or investigate online sites such as Chairish.com* Redeem reward points: One-third of all rewards go unredeemed each year, so check your accounts and make your claim.* Walk dogs: People are busy at this time of year, so taking Polly the Pug for a walk in the park could earn you anywhere from $15 to $30 an hour. Advertise on Craigslist or with your local veterinarian—or, again, ask around.* Sell your creations: Your Christmas cookies, homemade decorative greeting cards, or any other creative hobby could sell on sites such as Etsy, Deviantart, or Zazzle—or at local fairs.* Participate in clinical trials: Play safe with this one by checking with Clinicaltrials.gov, but you could pad your wallet by joining a legitimate study for medical or pharmaceutical companies.* Cash in unused gift cards: Check in all your nooks and crannies for any forgotten gift cards and contact a gift card resale site such as Giftcardgranny, cardpool, and Junkcard to get at least partial value.* Perform odd jobs & small tasks: Advertise your writing, translation,

Which Stocks Should You Own In A Bull Market?

With Michael Batnick, Director of Research at Ritholtz Wealth Management and writer of the blog Theirrelevantinvestor.comThe definition of a permanent portfolio (in the U.S.) is one constructed of one-quarter U.S. stocks, one-quarter cash, one-quarter long-term government bonds, and one-quarter gold—simple and easy to understand.Michael Batnick, Director of Research at Ritholtz Wealth Management and writer of the blog Theirrelevantinvestor.comexplains to our listeners the benefits and drawbacks of the permanent portfolio and why it’s not for everyone.With an equal distribution of asset allocations, a permanent portfolio is resistant to volatility; in fact, Michael estimates it may be about half—or even less—as vulnerable to market volatility as a standard 60 stocks/40 bonds portfolio. That’s a positive feature. When a bear market hits and stocks are dropping like acorns from an oak in a windstorm, you can sit back and relax. Not for the faint of heart investor.But what happens to your serenity in a bull market when stocks are rising and your brother-in-law with the 60/40 portfolio is dancing in the street and ordering a private jet with his earnings? That’s not so much fun.  The challenge for the permanent portfolio investor is having the ability to sit back through these upsides in the market and watch everyone around you making so much money.Since we all know that what goes up must eventually come down, Michael reminds us that, although bull markets are comparatively long, a bear market always follows and the gnashing of the teeth through those downturns  strikes a heavy emotional toll. As Michael tells it, “The challenge with the 60/40 portfolio is, of course, that the bear markets are quick and they're vicious. Eighteen months doesn't feel that quick, but the challenge of the permanent portfolio is that the bull markets are so long.”  You have to have the mentality to hang in there.The permanent portfolio versus the classic 60/40Going back to 1976 when Barclay’s Aggregate Bond Index began, the classic 60/40 portfolio did just a bit over 10% a year and the permanent portfolio did a little less at 8.4% a year, which doesn’t seem like so much until you consider the difference that 1 ¾% can make. One dollar would have had a total return of 5000% with the 60/40 and only 2600% with the permanent. Less wealth created, for sure, but the permanent portfolio gives you the ability to stay invested for 30 or 40 years, but you must give yourself reasonable expectations.Holding a permanent portfolio in today’s environment might require the stoicism of a monk— stocks are rising, cash is at zero, and bonds and gold are dropping. However, when the downside occurs, it’s just the opposite for the permanent portfolio investor who can sit back and snooze while the economy trembles. But, Michael adds “…expansions are much longer lasting than contractions.  They (permanent portfolio investors) sit around waiting for the last laugh, but they could be waiting for a decade or more.”It’s a choice not every investor is willing to make.

Don’t Let Holiday Spending Ruin Your Relationship

With David Maxfield, Author, Consultant to Fortune 500 companies, and VP of Research at VitalSmarts.com, Crucial Accountability, Influencer, and Change AnythingAlong with tidings of comfort and joy, the holidays often bring unwelcome stress over holiday spending. How do we avoid blowing it all by Black Friday…and how can we talk to our spouse or partner in a way that doesn’t end up in rancor and discord?The author of three New York Times Bestsellers, Crucial Accountability, Influencer, and Change Anything, consultant to Fortune 500 companies, and VP of Research at VitalSmarts.com, David Maxfield unwraps the secret to talking about holiday finances, staying on financial track, and maintaining your holiday cheer.The holiday money pitMoney is a strange bedfellow; having the “money talk” with our loved ones, whether it’s our children, aging parents, or our partners, propels us into emotional territory where the stakes are often quite high. It just strikes a raw nerve with most people.When it comes to agreeing on a budget for holiday spending, David refers to research that reveals the three ways people are most inclined to react:* Change the subject and avoid the conversation.* Lie about what things cost.* Hide the items altogether.And over half the people in the survey admitted to spending $500 or more over what they had agreed upon with their spouse. It’s easy to see that serious conflicts could arise.Coming to terms instead of coming to blowsSo how should you go about avoiding a conflict over this? David says the first thing is to start early, perhaps as early as before Thanksgiving—sit down, come up with a budget, and establish financial ground rules.After that happens, if one partner goes off the rails, it’s critical for the health of the relationship to discover why the overspending has occurred. If he or she has rented a storage unit to hide the purchases or continually lies about it, then the focus comes down to one of trust, which is a much bigger issue.Whether it’s spending for the holidays or any other time of the year, acknowledging the emotional component of talking about money within a relationship is important. You have to be able to approach your partner without him or her becoming defensive, which is not easy in what David refers to as our “very low ac...

With Interest Rates Rising, What’s In Store For Real Estate?

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLTerry Story continually reminds us that the real estate market is sensitive to outside factors, so it’s smart to know which way the wind is blowing in 2017 if you plan to buy or sell.How high will they go?Yes, the Fed has been threatening to raise rates by the end of this year and now with a new administration moving into the White House, a slight rise has already happened. Don’t worry about huge hikes anytime soon, though; most experts say we’ll be dealing with rates of 4-4 1/2%, still well below 5%.We’ve been seeing low inventory and high prices for a while now, and Terry predicts an increase in price of about 3.9% for 2017. With inflation running around 2%, that’s still a gain greater than inflation.It’s baby boomers and millennials all over again.And what does all this mean to buyers, especially first-time buyers? Realtor.com says they will face new hurdles navigating the qualification and buying process. Higher mortgage rates mean higher monthly payments, in most cases, putting a strain on the budget of millennials who are the largest demographic group out there looking for new homes. They could find themselves priced out of the market. A bright spot on the horizon, however, is the anticipation of a stronger economy which will bring higher wages and less job insecurity to this young group of buyers.On the other side of the demographic spectrum, baby boomers, who make up 30% of prospective buyers for 2017, will be out there are wanting to downsize. So, we have these two distinct age groups dominating the market and pretty much determining trends for the next 10 years.Go Midwest, Young Man and Woman Especially for millennials, the real estate hotbed is in the midwestern cities, as illustrated in the chart below from Realtor.com for top housing markets. (A tip for business owners or entrepreneurs catering to this demographic.)Top housing markets from Realtor.com:1Phoenix, AZ2Los Angeles, CA3Boston, MA4Sacramento, CA5Riverside, CA6Jacksonville, FL7Orlando, FL8Raleigh, NC9Tucson, AZ10Portland, OR11Durham, NC12Colorado Springs, CO13Jackson, MS14Detroit, MI15San Diego, CA16Salt Lake City,

How Small Business Owners Can Win The Tax Game Right Now

With Joy Taylor, Tax attorney and Tax Editor at Kiplinger.comThe very idea of an audit by the IRS can make strong men and women quake. As long as you don’t operate in the crooked lane, being audited is not nearly as scary as one might think, but, even so, it’s better to avoid waving any red flagsA few months ago, we spoke with Joy Taylor, tax attorney and tax editor at Kiplinger.com, about ways to avoid audits for retirees. This week she’s bringing her sage advice to address small business owners.Quelling fears of an audit by the IRSThe likelihood of any individual getting that unwelcome notice from the IRS is .84%, that’s about one in 119 returns.Even so, fear of an audit runs especially high with those who are self-employed. Joy explains that’s partly because small businesses are able to take many deductions that larger businesses cannot, and deductions are something that the IRS keeps its eye on. In 2015, the IRS examined between 2% and 2.5% of small business owners who attached Schedule C; that percentage is 3 times the overall rate for individuals, still not a large number, however.Know how to play the IRS tax game.A small business owner earning over $1 million a year has a one in ten chance of an audit. But, if you don’t make enough money or if you report large losses, your chances also increase. This gets tricky since after about three years of losses, the IRS might view your business as a hobby. The thinking here is that if you are legitimately and seriously running a business, you can deduct losses, however, your activity also must generate profit for three out of every five years to avoid sending out a giant red flag to the IRS.Does your business sound like you’re having fun?Joy warns that the IRS looks at Schedule Cs with large losses especially within certain areas, such as dog breeding, horse breeding, and travel writing. If it sounds like a hobby and looks like a hobby, chances are you’ll be hearing from them.Assuming you run a legitimate business for profit, and not necessarily for fun, there are certain valid deductions you can take, with caution. If you work from home, you must use that office space exclusively as your principle place of business. Since more and more people are working from home today, the IRS has actually simplified the process so that instead of having to claim a portion of things, such as phone and electricity, a standard rate of $5 per square foot of space can be claimed, which is a maximum deduction of $1,500.Another red flag you want to be aware of is claiming 100% of your vehicle for business, since, this is rarely the case. What you should do, however, is keep detailed mileage logs and precise calendar entries to avoid IRS scrutiny.Joy also reminds us that in the rare circumstance that you are tagged by the IRS for an audit, it most likely will be done by mail, and, if you keep records and your nose clean, you’ll have nothing to be afraid of.

Does A Trump Administration Mean Higher Interest Rates?

With Allen Robinson, Founder and President of First Trust Mortgage CorpInterest rates affect us all, so it’s good to get the scoop from an expert to see exactly how much of a change is on the horizon for 2017 with a President Trump in the Oval Office.Allen Robinson is the President and Founder of First Trust Mortgagee, specializing in providing residential mortgages, and, therefore, is the perfect expert to address some of our concerns.Rumors of an end of the year interest rate hike by the Federal Reserve have been twirling the wind for some time now, but since the election—possibly because of an anticipation of accelerating economic growth and a pickup in inflation—we’ve already had a hike of 0.5% in 10 days. Even so, rates are still relatively low with 30-year fixed-rate conventionals hovering around 4% and 15-year fixed rates in the low threes, at 3.25Interestingly, says Allen, we’re now at the same place we were in January 2016, and, so, after a dip in mid-summer, we’re ending the year where we started.  In spite of the rise in the fixed rates, the adjustable mortgage rates have not gone up nearly as quickly, creating a gap that most likely will continue. A seven-year adjustable (meaning that the rate is fixed for the first seven years and then changes in the years thereafter) today is going at a rate of 3.5% for those first seven years.Looking back into the history of mortgage rates.If the specter of rising interest rates is causing anxiety, a look into the past should quell those fears.The averages for a 30-year mortgage:In the 1970s—8.86.In the 1980s—in the 12s and 13sIn the 1990s—8.12In the 2000s—6.29Today, that average is 3.94.What will 2017 mean for the first-time home buyer?Interest will rise affecting first-time home buyers, many of whom will be millennials going from the bar scene to life in the domestic lane. What they carry with them in many cases, unfortunately, is student debt. Adding that financial burden to higher mortgage rates and increased home prices, and you can see the financial challenges they’ll be facing. Typically, says Allen, millennials are putting down only 3% and then borrowing more, which, in turn, means they’ll have to pay private mortgage insurance to cover the loan-to-value gap on their home.Who is the keeper of your mortgage?Allen deals strictly with residential mortgages, of which, locally, 35 to 40% are FHA loans. It may come as a surprise to learn that all conventional loans are eventually bought by either Fannie Mae or Freddie Mac, meaning that the government actually owns the mortgage market and that banks are only pass-through institutions, taking their bit off the top to service these loans. As a consequence of this set-up, says Allen, “the government is directly involved in keeping these rates as low as they've been.  We'll see what happens as the new Trump administration moves in.”  The industry outlook is looking good for the moment, says Allen. “Here in South Florida, our biggest competition to the mortgage industry is people paying cash for their properties.  The other stimulus is that rents have gone up so high that, in my world, if you keep the interest rates below 8%, it's still more affordable to buy a home than it is to pay rent at these ridiculous rates.”  In spite of uncertainty over the direction of our new government in the coming year, it’s good to know, should you be in the market to purchase that new home, that the sky won’t be falling on it anytime soon.

Putting Your Place On Airbnb?  Protect Yourself First…

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLThe past few years have brought about major changes in almost every sector of our lives. We now have VRBO, UBER, Airbnb, not to mention Twitter, and who knows what’s coming next?Throughout her 28 years in the real estate business, Terry Story has had to adjust to many innovations in her industry. VRBO and Airbnb are the most recent disrupters to come along and have already had a profound effect on the market.Airbnb could be coming to a house near you.An online service that allows people to host or rent their homes for free, Airbnb allows people to host or rent their homes for free. However, says Terry, “people don't realize that in posting their homes on Airbnb there are regulations.  There's liability, there's taxation involved.” It’s required to check in your area for any regulations or required permits or licenses.In addition, you should check with your insurance agent to determine if you’re properly insured for damages or injuries incurred during your rental period. It may be your home that you’re renting out, but to the government you’re on the same playing field as commercial rental apartments or hotels, so make sure you know and adhere to the rules.Terry says that in the state of Florida, you now have to collect a 6% bed tax in order to rent out your property in this manner. On another note, be aware that once you turn your home over to commercial use, you lose your homestead exemption.Deposit not required!Contrary to what most people believe, it’s not mandatory to put down a deposit before purchasing a home. Terry says that “for a contract to be binding in real estate, it only requires consideration.  Consideration is defined as something of value offered for something else of value. States vary, but in Florida the formation of a contract is accomplished when there is an offer and an acceptance between the contracting parties of the exchange of consideration, that is something of value, sometimes referred to as the meeting of the minds.”A deposit is the way to go in almost every case because “the seller is looking for liquidated damages in the event that you don't go through with the deal. The deposit goes into another section of the contract called liquidated damages.” Terry says she’s never done a transaction without there being a deposit, it’s the accepted way of doing business; legally it’s not required; realistically it is.Showing the moneyThe other requirement for a buyer is proof of funds. You have to show you’re financially sound enough to go through with the sale and to afford the responsibilities of the home.Terry says that whatever changes or innovations are in store for 2017, your qualified real estate agent will be your best advocate if you plan to buy or to sell a home.

Great Investor Guy Spier Opens Up His Wallet

With Guy Spier, Value Investor with Aquamarine Capital, Author of The Education of a Value InvestorWith so many investors all trying to beat the market, what separates a truly Great Investor from the pack? One major factor is that Great Investors know the territory that lies underneath the map.Guy Spier is a Zurich-based investor and author of a book on investing entitled The Education of a Value Investor and is well known for bidding $650,100 with Mohnish Pabrai for a charity lunch with Warren Buffett in June 2007.Guy says his investment theory comes down to zigging when all the others are zagging—and the ability to know the difference between the “map” and the “territory”.Between the map and the territoryThe “map”, he goes on to explain, shows data and other salient information about a company that on the surface appears to reveal what’s going on inside but, in reality, is covering up the true value and obscuring future prospects.A firm’s quarterly report, for example, is a “map” created by the accountants who estimate sales and future earnings based on a number of assumptions, when, in fact, those assumptions often don’t pan out. To assess the actual value, Guy stresses the importance of looking more deeply into the “territory” for the degree of divergence between the two. For example, is a company posting revenue figures at the point when clients have actually bought or are they throwing out higher numbers that reflect only the intention of clients to buy? A great investor looks for that divergence and moves when the divergence swings in his favor.Warren Buffett defines the moat.Just as in days of old when plundering knights were thwarted by an open drawbridge over the moat surrounding the castle, attractive investments are those that have defensible characteristics.Warren Buffett has been quoted many times about the moat which he explains somewhat as a tall bridge across a sea mass, where the only way you can drive a car from point A to point B in that area is over that bridge. A company that is protected in such a way that renders it not vulnerable to competition is becoming even more rare in the digital age. Buffett’s partner, Charlie Munger, has stated, "Moats are getting attacked in many, many different areas and whole corporations that were set up for a certain kind of information and economic infrastructure are having to adjust. Some will adjust and some won't."With moats breaking down, the challenge to the investor is even greater, says Guy, and “the problems we face as investors is that those moats have become even more highly valued because people realize they're even rarer than they were before.”  Those fewer companies that are protected by a moat become even more valuable, leading in some cases to extreme over-evaluation.What’s in Guy Spier’s wallet?The question we always ask of our Great Investors is “what’s in your wallet?”Guy answered that even though investing in smaller cap companies is a better place to be, it’s also more likely to be more vulnerable to changes in the competitive dynamics in a way that larger companies aren't.  “This has created a bias in me to want to be and feel safer in larger companies. One of the best places to protect yourself from inflation,

How To Rock Your Employee Benefits

It’s that time again! We’ve almost wrapped up another year and the holidays are here—time to relax, bond with family and community, and enjoy various holiday traditions. But in all the hustle and bustle of Thanksgiving, Black Friday, holiday shopping and socializing, it’s easy to forget about that other most important annual tradition of selecting workplace benefits for the coming year.The benefits of employee benefitsHealth insurance and other benefits helped draw you to your job. But when a bazillion projects fill your inbox, it’s tempting to cruise through open enrollment on autopilot, but I strongly urge you to not take this one lightly, which is why I’m giving you this heads-up ahead of the final deadline.This is one task worthy of your attention, so here are five common mistakes I want you to avoid:* Choosing the same coverage mindlesslyThe biggest mistake is tuning out. I know many of you will spend a fair amount of time looking for deals and planning your Black Friday and holiday purchases, which is great. But I also urge you to dedicate some time on planning for your financial security, and, frankly, this will not take up a lot of your time. It’s totally worth it!A 2014 survey showed that 90% of all U.S. employees elect the same benefits plan year after year, without really bothering to check if anything has changed. That’s not a good strategy because insurers often change benefits within plans to drive up their profits or fix what’s not working for them—and I don’t want you to get blindsided.While a change may seem small on the face of it, it may have a big impact on your family. For example, a health plan might change its provider network and exclude your doctor.On the flip side, your employer may have expanded its selection of plans, with new perks, and by blindly going with your old plan, you might just be leaving money on the table.So do this: Make sure you attend the open enrollment meeting at work (almost all employers have these open enrollment meetings) and use the tools provided to compare plans. Take questions to your employer’s human resources department or benefits consultant, so you are aware of plan changes and can proactively select one that’s right for you. Get into the habit of doing this every year, and, come what may, make sure you attend your company’s benefits meetings and keep yourself updated all year round.Also—and this is important—if there have been changes to your family situation, such as a newborn, marriage, divorce or kids leaving home, make sure you notify HR and update your benefits accordingly.* Misunderstanding tax-advantaged accounts for out-of-pocket expensesMany employers provide tax-advantaged accounts that you can use to pay for child care, commuting, or out-of-pocket medical expenses. If used correctly, these accounts can help you save significant sums of money, but employees really need to understand the rules associated with them because each type of account works a little differently.For example, with health savings accounts, or HSAs, all the unused money rolls over to the following year. On the other hand, many medical flexible spending accounts, or FSAs, restrict this and let you roll over just $500 of unused money to the next year, and you lose any unused money above that amount.So understand how the accounts work, estimate your annual expenses before you decide how much to contribute and keep a running track of what you spend through the year.* Choosing a health plan on price onlyNever choose a health plan on price only. Most U.S. employees have their portion of healthcare premiums directly deducted from their paychecks, so many of them look at price and often pick a lower priced plan. But, beware!—many of these lower premium plans come with higher deductibles and extra copays.

Alert! New Home Building Is Exploding

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLWhen the numbers come in, sometimes it’s good to pay attention, especially if you’re in the real estate market and the numbers in question relate to record highs.Terry Story, our resident 28-year agent with Coldwell Banker, reports a 25% gain in housing starts, which is new construction. “That's the highest level since August of 2007, according to the Commerce Department last week”, says Terry.  “This is actually the greatest percentage gain since July of 1982.”In September of ’82, the Federal Reserve started to reduce rates which precipitated the great bull market of the ‘80s and ‘90s, and here we are coming into 2017 back at record levels.The highest surge in housing starts has been with single family homes, up 10.7% of all new construction. In the South Florida market, this hasn’t been so apparent because there’s not much land on which to build, unless you go farther north and west. What is evident in South Florida, however, are a lot of home renovations, high rises, and rental units.Although it’s impossible to know if this upward trend will last, Terry points out that historically these construction projects do have a certain amount of economic endurance. Throughout the process, building materials, furniture, and appliances, for instance, are being bought—an example of trickle-down economics at work.Again, for the South Florida market, inventory remains low and prices remain high, which has created a state of stagnation since many properties just aren’t saleable; there’s little to buy at fair market value.Interest rates may have a big impact on all of this very soon as we’re seeing rates on 10-year treasury notes increase, foreshadowing an uptick in home mortgage rates and making it more expensive to buy a home. On the other side, it may also bring home prices back down to a more realistic range for buyers.For the next several years, the movement in the real estate market will most likely be defined by two diverse age groups: older millennials (between 25 to 35 years old) will be out there buying new homes as baby boomers (the 65-year-old age group) will be selling and then downsizing into smaller homes or rentals.So lots of movement ahead in the housing world, according to all the data.

Kids Too Attached To Home? A Parenting Guide For You

With Allyson Hawkins Ward, Chief Executive NCAR at IBM, Author of Please Don't Come Home: (Except for a Visit); A Field Guide to Creating Independent AdultsIt’s perfectly fine to hover over your child’s cradle, but it’s not okay when they’re eligible to vote and taking their LSATs.Allyson Hawkins Ward's new book, Please Don't Come Home: (Except for a Visit); A Field Guide to Creating Independent Adults, is a must-read for parents who want to raise independent and emotionally healthy children.As an executive coach, Allyson became aware of a problem when many of her coaching sessions designed to help clients with their careers ended up focusing on their high school or college-aged children unable to cope with life without being dependent on their parents, more in the emotional sense than the financial.Helicopter parents—listen up! An overly-protective brand of parenting has produced a generation of kids ill-equipped to move out of the shadow of parents who have, for all of their lives, monitored, sheltered, and directed every aspect of their existence. Moving out of the house, going to college, getting a job—it’s scary out there!Parenting guide for baby boomers.The generation of baby boomers is largely responsible for creating this atmosphere of uber-parenting, somewhat with good reason. Stranger-danger never existed in the way it has since the wave of child abductions and the publicity it stirred up came into our culture back in, let’s say, the 80s and after. Young children were taught to mistrust, to use passwords, and to keep in constant communication with their parents—and that’s become so easy to do, often to the extreme with tweets, texts, and all the myriad social media sites at everyone’s fingertips.Hooked on praiseAllyson talks about the phenomenon of over-praising and over-rewarding our children to the degree that they can’t accept losing or not bringing home a trophy for merely showing up at the soccer field. Like being dependent on drugs, they can’t move forward in school or ultimately in their careers without being lauded at every juncture. They need that fix!  “You're really, really setting them up for some very difficult times,” says Allyson, “if you're not there to maintain that level of praise.  Of course, that doesn't happen in the real world.”  Furthermore, she says, “Showing up is not an achievement.”To help parents cope and hopefully correct the effects of helicopter parenting, Allyson’s book contains a 4-step strategy called GRIT.  She explains that GRIT stands for hard work and is a game plan to get our kids ready for life on their own, to show them how to be resourceful, how to advocate for themselves, and how to have the resilience to brush off the inevitable failures.The value of failureAllyson makes the very strong point in her book that it is better to praise for effort, rather than for intelligence, citing a study which showed that students praised for hard work were able to take on new challenges and break new ground, whereas those praised for intelligence took the easier path by repeating the same patterns, just to avoid looking bad and losing face. The goal is to continue the journey by growing and improving along the way.Allowing our children to fail and instilling within them a resilience and resourcefulness which pulls them through those failures is a gift of ...

The Best Car Insurance Prices Are Literally At Your Fingertips

With Penny Gusner, Insurance Expert at Insure.comIf you drive a car, you need auto insurance, and with so many ads out there saying “come with us”, you want to know that you’re getting the best deal.Penny Gusner is an expert on car insurance and as an analyst for websites such as insure.com, carinsurance.com, and insurance.com can steer you in the right direction.Go online to get on the right track.Insure.com ranked the best auto insurance companies based on an evaluation by surveyed policyholders. Five key factors made up the survey:* Customer service, which encompasses any questions raised after becoming a policyholder.* Claims service, all the way from the incident to the resolution.* Value for price* Customer recommendation* Ratings from A.M. Best, a global insurance credit ratings serviceBased on this survey by insure.com, you’ll get the best auto insurance prices at—in descending order—USAA, ACSA (AAA of Southern California), CSAA (AAA of Northern California), Travelers, Mercury, and State Farm at number six. Surprisingly, some of the most well-known and more highly advertised, such as Geico, Allstate, and Farmers, are far down the list.Low premiums can be too expensive.Price is understandably one of the most critical factors when choosing an insurance company, but Penny cautions against not carefully evaluating other features. For instance, when you have to make a claim and you get the run-around—having to take your car for multiple quotes for repair, for instance—or the claims department is difficult to reach or to do business with, having the lowest premium loses its luster. A good hard look at each of the five issues is most important.Once you’ve narrowed your preferences down to several companies, you can go online at insurance.com, fill out a short form with your particular information, and quickly get quotes from those companies. But, says Penny, since “insurance policies are so personalized, like they can't guess about your real driving record and the crime in your area, all the things that when you put in your own information,” you won’t come away with the exact premium. You will, however, be able to compare costs before going forward with speaking to an agent.Take your questions to the dinner table.And, once again, as with many decisions we make in life, it always makes sense to seek out the recommendations from friends and family. Combining that method with the available online tools should make the process easier, faster, and more price agreeable.

2017 Real Estate Forecast

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLMore of the same is not always a bad thing, and heading into 2017, Terry Story sees the real estate market continuing along its present path—low inventory and high prices. Both of these factors affect baby boomers and the elderly who hope to sell and downsize and young people with limited funds looking to move into their first home.Many millennials have little option other than renting and, even though rental construction has been ramped up, the price of rentals still outpaces income which creates a conundrum if you’re trying to save for a down payment.Rise and fall of interest ratesTerry says that if interest rates rise, which they are expected to do by the New Year, that increase coupled with housing and rental prices will create a double squeeze making monthly payments less affordable for most people.Will self-correction save the day?If prices remain too high, then buyers will stay away, houses won’t sell, inventory will rise, and prices will soften.This is the way markets self-correct and is something to think about, says Terry. “It’s the interesting dynamics of working with a free marketplace.  It's good.  It's the way markets self-correct.”Cycles generally run in 10-12 year segments, and we’re now coming up to the end of one and the beginning of another. Regardless of the political or economic climate, we should begin seeing shifts and adjustments in certain areas.Terry says a demographic shift is already occurring with the urbanization of the suburbs. Since housing prices have pushed many people to settle for living in communities outside of the city centers, shopping malls, restaurants, movie theatres, and other establishments common to urban centers are opening up in these areas.Commercial real estate vs online shoppingOnline shopping with free shipping and easy returns signals some warnings for many brick and mortar businesses. A case in point is Macy’s who this year announced the closure of a sizable number of its stores due to online purchasing. Expect to see some changes in the types of businesses occupying space in major retail centers—health clubs and gyms and restaurants, for example.

What Is Going To Happen To Your Money After The Election?

With Steve PomeranzWell, the election is over and, thank heaven, we can get back to important things, like learning about self-driving cars and watching Game of Thrones and WestworldI will say that, when it was over, I felt a strong sense of relief. It was as if I had been living with a screaming monkey running around my house, throwing things at me every day. At least now, the house is quiet and I can get control of my mind again.So what does this change in our political landscape mean to investors, to savers, and to us money watchers?Let’s take a look at the recent past first. If you have been following the market—which I do every day because it’s my job—we initially saw a stunning decline in the price of the US stock market on election night. In case you hadn’t heard, stock market futures at one point declined by 800 points at 2:30 election morning. I got all itchy and started to think about buying the market on this tremendous dip. Gotta buy the fear, right? But, alas, I was not the only one with that in mind and, by the end of the day, the market had rallied 300 points.What is most fascinating, however, was the way the different sectors in the market began acting. But before we look at the stock market, we should take a close look at the bond market because this kind of explains it all. The bond market got clobbered! Interest rates soared on any bonds with longer-term maturities, causing their prices to drop. This means if you have bonds in your portfolio that are there to keep you safe—guess what?—they just got really volatile and have declined more than stocks.And any company that could be hurt by rising interest rates, like utilities and real estate, also declined. On the other side of the coin, companies that would benefit from rising interest rates soared—especially bank stocks. Bank stocks make their money by the spread; the spread is determined by what they pay us on our checking and savings accounts, which is zilch, and what they are able to lend that money that we give them to businesses and individuals, let’s say, in mortgages and business loans.Well, if interest rates go up on the long end of the scale, that affects what the banks get on mortgages. They get more money on mortgages; at the same time, interest rates stay low on the short term, which is our savings accounts, so they make a lot of money. Plus, they have a certain amount of leverage, which enhances their returns too. We saw some huge moves in the big banks last week.Here are some thoughts on possible future scenarios: The current feeling is that in order for Trump to fulfill his promises about getting people back to work, he will start to spend lots and lots of money on infrastructure—that’s fixing bridges, airports, waterways, roads, and the like. He will do this by borrowing tons of money and then using that money to build things. Who knows how to do that better than The Donald? He always borrowed HUGE amounts of money for his real estate projects, so it seems this will be a natural.All this borrowing will filter into the economy and could get the economy moving higher.He’s hoping on some of the old trickle-down action that became famous during the Reagan years and, in Reagan fashion, he’s talking about lowering corporate tax rates and individual tax rates, which, according to theory, puts more money in people’s pockets and should get the economy moving. Higher corporate profits will be good for the stock market, so it may increase the disparity between those who have financial assets and those who don’t.Does that sound familiar? Well, it’s kind of ironic, for sure, because this is exactly what happened during Obama’s presidency, so I’m not sure if anything is really different here. The bottom line for all of us is to save and get some of those financial assets so you can participate in all of this—if I’m right.

Want To Know How To Invest Well? First, Learn The Language

5 Investing Terms You're Probably Using IncorrectlyLike most professions, finance has a language of its own. If you’re not part of the club—and even when you are—it’s easy to get the lingo wrong, and that can lead to some very expensive mistakes.To help you avoid that, I’ve compiled a list of some of the most frequently misused words in finance…and what they really mean.1. VolatilityA lot of people mistakenly think that volatility is the same as uncertainty and use the two words interchangeably. Volatility is also often framed as a bad thing, especially when people talk of “too much volatility” in the markets.But volatility is just a way of measuring the change in the price of an investment over a particular period of time— whether stocks are going up or down, the amount they move either way, is the stock’s volatility.Let’s say you have two companies, Company A and Company B, and both have an average share price of $30 over the past month. But if Company A had a bigger price swing than Company B, its stock is the more volatile of the two.So when a stock has low volatility, it typically does not make extreme moves away from its average price. And when a stock has a lot of volatility, its price swings are bigger. But these movements are simply short term—and here’s the key: For assets held over a longer period of time, these day-to-day movements have little impact on performance.One other note about volatility: A lot of people are afraid of it, but, if used wisely, volatility can be your friend. If you are buying, use downward volatility to buy; if you are selling, use it to sell. Be the master of volatility; don’t let it master you!2. Cheap vs. Expensive StockI’m sure many of you have heard investors look at the price of a stock and make a declaration about whether it’s “cheap” or “expensive”. In this misused version of the term, shares of Apple are deemed “expensive” if they’re around US$110 per share. But shares of a healthcare company—we’ll use Affymetrix as an example—which trades around US$14 per share are deemed “cheap.”But the price of a stock has nothing to do with whether it’s cheap or expensive. When financial professionals talk about cheap and expensive stocks, they are referring to what they see as a stock’s value relative to its long-term fundamentals and current earnings. So, for example, they may look at the price per share and compare it to the earnings per share and come up with a ratio called the price to earnings ratio or P/E.In this case, Apple’s P/E is 12 and Affymetrix sports a P/E of 117. So Apple shares are cheap, and Affymetrix shares are nosebleed expensive, based on current earnings. So price and value are not necessarily related.3 Median vs. Average (or mean)This one takes me back to elementary school math, but there’s an important difference between median and average (often also called the “mean”). Both median and mean refer to a midpoint in a series of numbers, but the way they’re calculated is very different.Let’s say there are 7 people in a classroom, 6 kids and one teacher. Here is a list of their ages: 5, 6, 6, 7, 7, 8 and 36The average (or mean) age of everyone in the classroom is calculated by adding all the ages and dividing by the number of people. So the sum of the ages is 75 and dividing by 7 results in an average age of 10.7 years.But we already know that, if all the kids are 5-6-7-8-years-old, an average age of 10.7 doesn’t really describe the scene because, of course, the teacher’s age skews the results. The mean isn’t representative of the age of everyone in the room since six of the seven people in the room are younger than the average age.A more accurate indicator is the median age. The median is calculated by arranging the values from lowest to highest and picking the one in the middle – which works out to 7 years. So, the median age is 7.

The Best Value Of Your Car? It’s In The Mileage, Baby!

With David Muhlbaum, Kiplinger’s online editor and resident car expertKnowing how to take care of your car can prolong its life and save you money.David Muhlbaum is the online editor for Kiplinger magazine, covering business forecasting and taxes along with the unusual subject of car maintenance for which, as he says, his degree in American literature qualified him not one bit.Your car manual and your mechanic are your 2 best friends…for the first 100,000 miles.David’s advice for keeping your car running in optimal condition for the first 100,000 miles is simple:  pay attention to the maintenance schedule as stated in your car’s manual and find a good mechanic.Very close to or just after hitting the 100,000 mark, David encourages you to check the health of the timing belt and related parts which, if not attended to in time, can result in a multi-thousand-dollar replacement bill.Getting to that second 100,000 miles.After your car exceeds 100,000 miles, your manual won’t be of much help, so that’s the time your trusted mechanic and your diligence will pay off if you want to ride your vehicle all the way to the 200,000-mile marker. During this phase, David says it’s imperative to be proactive with your own maintenance schedule and, this being the technology age, there’s usually a Youtube video to answer and help diagnose any issue you might have.Make a checklist and check often.Monitoring your car’s condition is somewhat like knowing your own body: Your car has a certain sound, a certain feel, so any change should be a red flag to take notice, and David says to use your senses as a guide:Do you hear a rattle?Do you see a stain from underneath when you pull out?Is there a strange smell coming from the engine?Are your lights including turn signals working?Paying attention to these warning signs can save you time and money.How and when to change the oil.Contrary to the standard concept of changing the oil every 3,000 miles, David explains it’s more important to do so according to the instructions in your owner’s manualAnd although we’re hardly talking about whether to use  extra-virgin olive oil from Italy or Spain for your salad, the decision between using synthetic (which is better, but more expensive) or standard oil will most likely be determined by price. The important thing is to remember to stay on schedule with your oil changes.Say “no” to short trips.David explains “That fuel contains water and some of that water will get into your car's oil and exhaust system every time the engine runs.  On a longer trip, the car's engine gets hot and burns that unburnt fuel and other contaminants out of the oil, out of the engine, out of the exhaust.  That's a good thing that it's gone”So no “stop and go” jaunts if you want to extend the life of your car.If 50 is the new 30 in our youth-oriented culture, then David Muhlbaum sees no reason why 200,000 can’t be the new 100,000 for the life of your car.

Today’s Most Important Secrets To Buying A Home

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLThe climate today is definitely not as it was back in 2006-2008 when the real estate market was spiraling downward and many people found themselves underwater and couldn’t afford to live in their homes. One way out of that bad situation was to sell short of what was owed on the home and then appeal to the bank for loan forgiveness.Terry says that, although not nearly as common as back in the days of the big bubble burst, short sales can still be found in the today’s real estate market.A Bargain or a Big Mistake?Before succumbing to the lure of the great buy, Terry has some words of caution:* Keep your emotions at bay while you assess the true value of the home.* A house in short sale has probably sat there for a while, probably not well-cared for.* Check for signs of neglect such as termite damage, water damage, appliances in disrepair, etc.* Do the home inspection immediately, even before waiting for the bank to accept the offer.* Investigate all legal and insurance information in advance.What looks at first sight like the deal of a lifetime could turn out to be a big mess, so proceed with caution.Terry’s Real Estate Survivor GuideQuestion #1: When does an offer become binding?If a buyer submits a strong offer that, after a length of time, is rejected, does that potential buyer have any legal recourse?Terry’s answer is an unequivocal no, unless there is some written contractual relationship between buyer and seller, and that stands even if the listing agent conveys unrealistic expectations to the buyer.Question #2: When is a post-occupancy agreement needed?If the seller remains in the house after closing (and is then technically a tenant) or the buyer moves in before closing, it’s advisable to have a written agreement to protect against damages incurred either by fault of the occupant or act of God. So always be sure to have insurance and liability issues in place.

How To Buy Art Successfully In Today’s New World

With Peter Loughrey, Director of Modern Design & Fine Art at Los Angeles Modern Auctions (LAMA)An appreciation for art, like for beauty, is in the eye of the beholder, but a shift is occurring in the art market today that has little to do with art for art’s sake.Director of Modern Design and Fine Art at Los Angeles Modern Auctions, Peter Loughrey, is perhaps the most experienced modern art and design specialist in the auction house industry, but he’s probably most well-known for his appearances on the PBS Antique Road Show.Peter explains that the change in the art market has much to do with the difference in the motivation of the collectors of today as opposed to those of 30 or 40 years ago—the baby boomers vs the millennials.An object of beauty or a good investment? Back in the mid-80s when Peter began his career, baby boomers were buying art for mostly aesthetic purposes. So whether the purchase was a pop-art painting of a rising artist or a Louis XVI French slipper chair, it was bought to be enjoyed. Since then several things have occurred to change the landscape: Baby boomers are retiring or downsizing and either selling off or passing on these treasures to their heirs. In addition, over the decades, the value of many of these items has increased dramatically, qualifying them—if they weren’t already—as investment pieces. A whole new resale market has emerged that could benefit the seller who might be in need of additional finances going into retirement.The millennials who are now coming into the art market, says Peter, “have a taste for modernism and for contemporary art periods and movements.  They're focusing more on the pieces that have the most value-oriented backgrounds.” His advice to them always is to “find pieces that you like that are also holding their value and are consistently tradable.”Who can you trust in the digital age?The digital age has placed a limitless supply of information literally at our fingertips. In the past, one had to trust an art dealer who may or may not, in fact, be trustworthy and who typically held on to information making it difficult to determine the value of an item at any particular moment.The art market turned upside down.The dramatic change, says Peter, is that… “there's a whole network of dealers like myself who will share that information for free and very quickly.  That is actually a unique distinction about the market today, as opposed to thirty years ago.  That gives people the option of understanding what things are worth, almost on a daily basis.  Almost like you would look up your stock portfolio, you can now look up your art collection portfolio.”Exciting stuff if you are an art lover or investor.

Are Home Prices Rising Or Falling?

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLThis week we begin Terry Story’s Real Estate Roundup with the question that’s always on the minds of home buyers and sellers:Are home prices rising or falling?Terry reports the findings of the S&P Core Logic Case-Shiller 20-City Index Report which shows a rise of 5.1% in August after a 5% gain in July.The highest gains are in the Seattle and Denver areas, a reflection of better employment figures and rising pay rates. Other notable cities in this category are Dallas, Miami, and San Francisco.Looking forward to 2017Terry says that for the coming year, it’s predicted that the majority of home purchases will be those of first-time buyers. Low inventory and high prices are somewhat balanced out by easier mortgage qualification and low-interest rates which make ownership more affordable.The most desired features trending for these primarily young first-time buyers are safe neighborhoods, more space, and larger yards, all of which indicates a heavier move to the suburbs.The hottest times to buy that houseTypically, spring and summer are when realtors see the most activity owing to the school calendar, but this varies around the country and certainly in Florida with its steady influx of retirees.How has the rental market changed in the past year?Terry says the rental market is still hot and points to an average annual gross rental yield of 8.7% as the draw for investors. Of course, this doesn’t take into account costs of maintenance and upkeep and the risk of vacancy, all of which still allows room for profit.

Winter Is Coming….Keep Your Money Safe

“Winter is coming! Winter is coming! Winter is coming!” Is this a cry to get all of your money out of the stock market because the end is near?No, no, no, it absolutely is not!If you watch the hit series Game of Thrones you know winter has been highly anticipated throughout the six seasons it’s been running.  You may also know that you want to be on the right side of the wall for fear of the deathly “White Walkers”, and you may want to begin acquiring some serious protection if you haven’t already done so.  Just like winter is coming here and on Game of Thrones, winter may also be coming for your portfolio.  So here are some tips to ensure you’re on the right side of the wall and that you’ve got some serious protection for your portfolio during those dark times.Do I have your attention?  Let’s begin.Some people ask me, “Steve, with interest rates so low, why should I have any bonds or CDs or savings accounts in my long term investing plan?” This is when I tell them the story of the Farmer.A farmer must plant his crop at a specific time. He knows that as spring approaches, it’s time to get the soil ready for planting, fully aware of the growing and harvesting season ahead.If all goes according to plan, (maybe based on the Farmer’s Almanac or hopefully the Department of Agriculture), he will be tending to his crop throughout the summer.What does he do as he tends to this crop? Of course, he wants to keep his crop healthy until he’s ready to harvest in the fall, so does he pluck his healthy plants and keep the weeds sprouting around and trying to take over? Of course not, he weeds out the underperforming plants and keeps only the healthy ones.Notice I used the word underperforming plants. I do this purposefully because there is a direct analogy from the farmer’s experience to the successful investor.Most investors will look at their portfolio and sell their winners and keep their losers in the hope that the losers will rebound and become winners in the future. In reality, however, after taking their profits “off the table”, they end up with a portfolio of losers. This would be like tending your garden and pulling out only the healthy plants. You are left with weeds and other unwanted junk. Same thing for investors.Following this strategy of selling your winners and keeping your losers will end with an unhappy result.Farmer’s lesson #1: Cull out your weakest plants, get rid of the weeds and tend to your healthy plants, fertilize them, keep the bugs away, and watch them faithfully.For Investors: Cull out your weakest holdings, tend to the heathy companies in your portfolio, maybe add some money to them, and watch them faithfully. Look for their ability to compound their earnings at high rates of return and watch their business very carefully. If you can find a group of companies that will do this, hold on to them as long as you possibly can. This is where real wealth creation comes from.Farmer Lesson #2:The farmer knows, as we all do, that winter will eventually come. Some winters are mild, some are nasty, but as spring turns to fall and fall to winter, the farmer knows when it’s time to harvest and to prepare for the upcoming cold weather.What does the farmer do? He will take a portion of his harvest and cans or bottles it. He will put his tomatoes, his corn, his cucumbers, and make sure they are preserved for the winter ahead. And, most importantly, he will store these goods in his pantry to use when needed.For Investors: The bonds in your portfolio represent the farmer’s pantry.As stock investors, we know that markets and economies are cyclical and bear markets are always going to come. Bear markets are a necessary part of the economic cycle because of the basic fact that good economies that last a long time tend to make people do silly things.

What Happens After The Presidential Election?

With Mohamed El-Erian, Bloomberg View columnist, Chief Economic Advisor at Allianz, and Chairman of President Obama's Global Development CouncilHow will the election results affect the stock market and your financial future? With less than one week to go, that’s a question many people are asking these days.As a Bloomberg View columnist, Chief Economic Advisor at Allianz, and Chairman of President Obama's Global Development Council, Mohamed El-Erian is particularly qualified to sort out the possible scenarios.Mohamed believes that the impact on markets will be relatively limited if Clinton wins and Congress remains split since, as it’s been for the last eight years, getting anything passed will still be difficult.Disruption occurs, however, under two scenarios:* Trump wins and goes forward on his trade proposal and begins slapping tariffs on China and Mexico.* Clinton wins and the Democrats gain control of both houses of Congress, indicating more government involvement and higher taxes.What the Increase in The GDP Means For The EconomyReferring to something more quantifiable, Mohamed points out that the Commerce Department just released a GDP increase of 2.9 for the 3rd quarter, showing the economy rebounding stronger than in the first 2 quarters and indicating we’ll be in the range of 1.5-2% for the year as a whole. Higher business investments and more exports have contributed to these higher numbers, but, according to Mohamed, we are “well below what we are capable of if only Congress were to get its act together and step up to its economic governance responsibility.”According to Mohamed there is so much cash on the corporate balance sheets that Congress could unleash without even having to make a “big bang policy announcement”, but instead by acting on four particular areas:* Implementing a set of pro-growth structural reforms aimed at the loopholes, exemptions, and ad hoc changes that have rendered our tax system anti-growth.* Increase spending on infrastructure.* Retooling our labor market and education reforms.* Improving global policy coordination with the US playing a leading role.On a cautionary, but positive, note, Mohamed says that combining the better GDP number with a more robust labor market could help us move forward economically, with the Fed most likely hiking up interest rates in December to reflect these more promising figures. That is—unless the election results cause disruption.Can Congress and The American People Come Together Post Presidential Election?But it’s not only the stock market that will be affected by the election results; whoever wins this November must bring a divided Congress and country togetherMohamed says that “a signal of the extent to which messy politics contaminates good economics” concerns the difficulty of getting anything moving forward to improve our infrastructure, something that both sides in Congress and probably all Americans would like to see happen.  Unfortunately, our politicians fear being perceived as collaborating with the other side and risk being punished by the extreme fringes of either party.So how the stock market will react after the election depends on how the election winds blow and, for the moment, at least until November 8th, all we have is uncertainty.

If You Flip Houses, You’d Better Be Well Insured

With Terry Story, 28-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLEvery week, expert realtor Terry Story keeps us up-to-date on the latest news in the real estate market.Following up on last week’s topic about the returning trend of flipping houses, Terry emphasizes the importance of having the necessary insurance if you’re planning to engage in that practice.Insurance checklist:                                     * Before renovating, notify your homeowner’s insurance company, since you’ll be increasing the value of the home.* Confirm that the general contractor is licensed and bonded and carries workman’s compensation and liability insurance.* Consider coverage for subcontractors because, if the contractor doesn’t pay them, it becomes your liability.* Think about having builder’s risk insurance which covers building materials and equipment.* Confirm that your contractor has completed operations insurance in case something goes awry after the job is done.When to Drive By a Real Estate ListingYou see a house in the paper or online that you like but are unsure as to certain aspects of the neighborhood. What time of day is best to drive by? According to Terry, one of the best times is around 8 a.m. in the morning, during rush hour. From there, she recommends:*10 a.m. to check for construction, traffic, noise*3 p.m. when kids return home from school*5:30 p.m. again to check on traffic and commute time*after midnight for noise from trains or planes overhead*Friday night for level of activity and safety concernsHaving the experience of a real estate expert on your side is probably the best investment you can make when considering to  buy or sell your property.

The Business Of Picking Stocks May Be Dying

I recently came across an eye-catching headline in The Wall Street Journal; it was titled “The Dying Business of Picking Stocks”, and it, of course, piqued my interest, so I read on.Here’s what the article had to say: Its main premise was that investors are moving their money away from active stock picking and moving it into passive investments such as index funds and certain passive Exchange Traded Funds that really don’t need a star portfolio manager, and this is pushing stock pickers to the margins.Instead of saying mutual funds and index funds, it’s better to think of mutual funds, in general, to be actively managed and index funds to be passively managed. So I’m going to be using these terms from this point forward.Over the past three years, investors have added nearly $1.3 trillion to passive mutual funds and exchange-traded funds, while draining more than a quarter trillion from active funds. On the one hand, people are pulling money out of active funds and moving it into passive funds, and people are moving new money toward passive investments as wellSo what’s driving this? Advocates of passive funds cite their superior performance over time, lower fees, and simplicity.And this is shaking things up on Wall Street, with hedge-fund managers—the quintessential active investors—facing mounting withdrawals as they struggle to justify their fees. Hedge funds bet on and against stocks and markets worldwide and generally have higher fees than mutual funds, purportedly because they can deliver market-beating returns. But the truth is this: Hedge funds have not outperformed the U.S. stock market as a group since 2008.With this trend getting bigger by the day, some giants of passive investing, such as Vanguard Group and BlackRock, are attracting lots of money and gaining clout in shareholder votes at public companies.That said, active funds continue to hold a majority of America’s invested monies—66% of mutual-fund and exchange-traded-fund assets are still actively invested, but those numbers are down from 84% ten years ago and are shrinking fast.In my opinion, the real driver of this upheaval is performance and the lack thereof by actively-traded funds compared to their benchmarks, which are typically indexes such as the S&P 500, the Dow Jones, or the NASDAQ for U.S. stocks. Here’s some data to back that up: Over the past decade, between 71% and 93% of active U.S. stock mutual funds have either closed or underperformed the index funds they are trying to beat, according to Morningstar.Moreover, passively matching the performance of a stock index basically involves building a basket of securities that represents the index. For example, if you’re trying to track the Dow Jones Industrial Average, you simply build a portfolio that mirrors the average of the 30 stocks that make up the Dow and re-balance your portfolio only when there are changes made to the index. Other than that, you pretty much do nothing! You don’t have to research companies; you don’t have to follow all the daily news about them; you don’t have to worry about whether shares went up or down, or by how much; and you don’t need to make buy or sell decisions. Just sit back, relax, and follow the index. So you’d save time, effort, fees, and commissions with this passive strategy—with no research and no unnecessary and expensive stock trades.As a result, passive funds’ expenses are a fraction of what active funds charge, sometimes 1/30th or less. And with the current climate of near-zero interest rates, even a few percentage points in fees stand out more than ever.Advocates of active investing will tell you that there is a downside, which is that passive funds are designed to only match the markets, so investors are giving up on the chance to outperform or beat the index.

Barbara Corcoran Reveals A Most Shocking Shark Tank Ever

With Barbara Corcoran, business woman, author, investor on ABC’s Shark TankThe TV reality show Shark Tank, now in its 8th season, catapults entrepreneurs into the winner’s circle or into the rejection pile, depending on the judgment of its business savvy panel of potential investors, the so-called sharks.One of those shark investors, Barbara Corcoran, who brings her experience as an outstanding business leader, author, and career builder into the “tank” each week, visited The Steve Pomeranz Show to discuss the somewhat startling changes we’ll see on the show this year, as well as to offer a few comments on her contentious real estate dealings with one of our presidential candidates by the name of Donald Trump.Barbara characterizes the new Shark Tank as confused, heated, and shocking. Not only does it bring the concept of cut throat competition into a new dimension, but it also goes out on a much edgier limb with some unconventional deals and entrepreneurs. For their part, many of the entrepreneurs are, in Barbara’s words, “getting greedier” by valuing their companies with astronomical numbers, partially because some have already raised a bundle by crowd-sourcing, which places a false monetary worth on the venture.X-rated TV in primetime? Barbara said she questioned one offer that was so shocking it rendered her speechless for 45 minutes wondering how it ever got by the lawyers in the first place. Even though the segment was doctored up so as to not offend anyone of any age, Barbara said, “When you see it, you'll know which one I'm talking about. Shocking!”When asked which of her recent deals was the most successful, Barbara answered unequivocally that it was the little knit sock company called Grace and Lace that turned into a $40 million business within three years. On the other end of the spectrum, her greatest disappointments were three deals she ended up losing to Lori Greiner this season and to discover the details, she says, again, you’ll have to watch the show.The Corcoran Group, which Barbara began in 1973 with a $1000 loan from an old boyfriend and partner, went on to become New York’s largest and most successful real estate company. That level of accomplishment continues to drive Barbara to mentor and invest in other startups. When asked about a recent rumor that she and fellow Shark Kevin O’Leary were interested in investing in the cannabis industry, Barbara countered that, although it would be a great money maker, marijuana was hardly in her game plan as an investment.Because of all her success, Barbara believes in paying it forward, which was the impetus behind OnDeck, an online contest she developed to allow a would-be entrepreneur the chance to pitch an idea that, if accepted, grants an award of a $10,000-no-interest loan, a trip to New York, and one-on-one coaching with Barbara herself.As for Donald Trump, Barbara Corcoran reveals that at one time they enjoyed a mutually beneficial business relationship. As a real estate developer, Donald built the properties that Barbara, as a real estate broker, sold. Until, that is, they made the biggest real estate deal in the United States for which Barbara’s company, The Corcoran Group, was entitled to a $5 million commission that Trump refused to pay and instead countered with a $5 million lawsuit. Barbara won that suit in court, and The Donald was ordered to pay the $5 million in monthly installments. Admitting that he’s the greatest salesman she’s ever known, she also says she’s surprised that he’s come this far since she’s never known him to follow through with his promises.Barbara’s business acumen is legendary and her commitment to helping energetic and innovative young entrepreneurs sincere, stretching well beyond the desire to snag the best deal on the Shark Tank. To see how this season plays out for Barbara Corcoran and the rest of the shark...

Clinton Vs Trump: Your Healthcare Is At Stake

With Laura Adams, Senior Insurance Analyst for insuranceQuotes.comClinton vs Trump: The prize-fighting atmosphere of this year’s presidential election process has two opponents glowering at each other from either side of the ring, diametrically opposed in nearly every area. The winner will be determined by either a knock-out margin or a close call. Whomever that victor is, you can be assured that one of the major platform items to be addressed, and one that affects all Americans profoundly, will be healthcare.Laura Adams, a personal finance expert and senior insurance analyst for insurancequotes.com has great insight into the ideas and proposals of both Hillary Clinton and Donald Trump on this critically important issue.Simplistically, Donald Trump favors the repeal of Obamacare and Hillary Clinton wants to tweak and expand it.Before examining the two varying positions, Laura points out that before either candidate can affect change to our healthcare system, there are countless complex laws and regulations on a state-to-state basis that come into play with many of the insurance carriers. In addition to that hurdle, any change or even dissolution of Obamacare must have the support of Congress.Bear in mind, Laura says, that if Trump is elected and the Republicans retain control of the Congress, probably nothing would block a repeal; however, if the opposite occurs and the Democrats are in control, it’s a different game altogether.The reality is that higher insurance premiums are expected for next year, largely due to a lack of competition in some areas of the country, but also because of prescription drug costs and a rise in the cost of living. On the positive side, Obamacare has eliminated pre-existing conditions as an exclusionary factor and the percentage of people in the US who are insured is now above 90%, the highest ever. In spite of that, the negatives can’t be ignored. Costs must come down without compromising quality of care and availability for all. One major problem with Obamacare has been the refusal of young people to opt in—whether because of financial concerns or a sense of invincibility. The theory was that the younger, healthier population paying in would balance out the older, sicker people who place the most weight on the healthcare system.Beyond his insistence that he favors the repeal of Obamacare, Donald Trump hasn’t spelled out his healthcare policy in much detail beyond stating that it would be “something much better”.Laura goes on to say that, “He has said that he would look at insurance more on a federal basis rather than a state basis, so he's talking about not letting insurance companies compete state-to-state, not letting an insurer say, ‘Okay, I'm going to do business in North Dakota, but I'm not going to do business in South Dakota,’ and breaking up those state lines would sort of level the playing field with competition.  That's really about as specific as he's gotten.”Trump also said he would save $11 billion by taking immigrants out of the system, would exempt health savings account from taxes, and would mandate doctors and hospitals to offer more transparent prices.  Laura adds that to her, this sounds like the free-trade system we had in past and that didn’t work very well.Hillary Clinton then would expand and fine-tune Obamacare by decreasing costs and placing caps on prescription drugs and premium increases. In addition, she would expand Medicare in those states that had chosen to not expand it. This idea is primarily for those consumers who don’t qualify for Obamacare because they earn too much, placing them in a sort of rock-and-a-hard-place position—they can’t afford insurance company premiums and they don’t qualify for Medicaid.She would also lower the Medicare eligibility age from 65 to 55,

The Tax Game For Avoiding Audits

With Joy Taylor, Assistant Editor at Kiplinger.comBeing audited by the IRS ranks at the top of the list of life’s greatest fears for many people. Joy Taylor of Kiplinger.com and a tax attorney in Washington D C reassures us that only a very small number of returns will ever be audited. In fact, in 2015 less than 1% of individuals received such unwelcome news from the IRS.That being said, Joy says there are common errors that could land any of us in that less than 1% group. She’s particularly concerned about retirees, many of whom are living on fixed incomes, and points out some red flags that could give the IRS cause to place unwanted scrutiny on some returns.* Taking higher than average deductions on a return, deductions that are disproportionately larger than the income. This applies to all taxpayers, including retirees, and could include a large medical expense or charitable deduction. If there are those deductions, and they’re legitimate, make sure you have proper documentation.* Not taking the RMD (required minimum distribution) from your IRA or 401k at age 70 ½ and older.* Conversely, for early retirees, taking distributions before reaching a certain age, generally 59 ½.* Declaring losses from rental properties which is not an allowable deduction. The exceptions are if you actively participate in renting your property, then you can deduct up to $25,000 of the loss against your other income that that amount does phase out. And if you’re a real estate professional, you can fully deduct your losses.* Recreational gambling losses and winnings must be reported, but the deductions for the losses can’t exceed the amount of the winnings.Retirement should be a time when the stresses of your earlier working life are behind you, when you can enjoy your hard-earned money with a worry-free mind, without fearing an audit notification by the IRS will turn up in your mailbox. Paying attention to Joy Taylor’s red flags will help assure you that your next tax return will be in that vast percentage which never gets a second look.

Living Large In The 21st Century

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLWe Americans were all a bit closer back 100 years ago, at least in the physical sense. In 1910, the average household of 4.5 people occupied approximately 1300 square feet. Today, those averages are 2.5 people sharing 2400 square feet.Averages aside, home sizes are heading in opposite directions depending on the part of the country. Orlando, San Antonio, and Nashville top the charts for the most square feet per house, whereas the smallest average homes are being built in Boston, San Francisco, and Miami. The obvious correlation here is the high density of population to smaller dwellings, perhaps most evident with New York City where the average home being built today is 11% smaller than in 1910.But the rising popularity of the micro-home, perhaps best characterized by IKEA’s 200 square feet version, can be attributed not only to a dearth of land in certain areas but to cost. Terry tells us she recently went inside one of these tiny houses in Maine, “a tiny house on a property, and the shower was actually outdoors, but it was teeny, and two people were living in it.  It was like, the bed was above the kitchen.  The place was immaculate, and this person told me he feels very comfortable living in there.”Terry also reports a return to the trend of flipping houses made popular back before the recession of 2008. But this time around, partly because banks are lending money a bit more freely, this practice is doable for the smaller operator who can buy an investment home of $200,000 or under, perhaps fix it up, and then flip it for a profit.Terry’s cautionary note for anyone considering a foray into flipping is to remember “you always have to have an end user.  When you're in the flipping business, you're taking a house, making it nice, and then reselling it. So as long as you have an end user still buying these properties, and the people buying, the end users, are people that want to live there.”  To return to an old theme—but one of interest if you’re buying or selling a home—home prices climbed in July an average of 5%, according to the Case-Shiller report and, again, it’s because of limited inventory. But, as always, there are geographic differences with some places in the double digits and others only from 1 to 5%.

Harry Potter: Boy Turned Financial Wizard?

Call him “the boy who saved”. Daniel Radcliffe became famous when he was cast to play Harry Potter, The Boy Wizard at the tender age of 10. This turned into a role that launched his acting career and brought him considerable wealth, estimated at about $100 million. But to give you some perspective, while $100 million is a heck of a lot of money, the eight movies in the blockbuster Harry Potter franchise raked in close to $8 billion worldwide.Now, five years after the final Harry Potter film hit the screens, Daniel Radcliffe (now a 27-year-old British star) revealed that he doesn’t touch the money he made and jokingly says he’s been hoarding his money at Gringotts, the bank for wizards.“I don’t really do anything with my money,” Radcliffe told the Belfast Telegraph in late September and put forth a compelling argument for why he decided to save it.Radcliffe said, “I’m very grateful for it because having money means you don’t have to worry about it, which is a very lovely freedom to have. It also gives me immense freedom, career-wise. For all the people who’ve followed my career, I want to give them something to be interested in, rather than them just watch me make loads of money on crap films for the rest of my life.” (I’m sure he wasn’t referencing the Harry Potter films, right?)While Radcliffe may be talking specifically about movie projects, no matter what your role in life, he’s right about not splurging what you have but saving it instead. For example, Radcliffe could easily have burnt that money on fancy cars, extravagant houses, and other expensive shenanigans, but having money socked away can afford you a significant amount of freedom and security. People with money in the bank sleep a little easier at night knowing they can weather unexpected financial shocks and even pursue new job opportunities if their boss turns out to be a real He-Who-Must-Not-Be-Named, a reference to the evil Lord Voldemort in the book series.But, despite the clear advantages of saving all you can, many people—and Americans, in particular—just aren’t saving enough. Survey after survey shows that we’re woefully underfunded for retirement, are ill-equipped to handle even a small financial emergency, and carry more debt than is ideal.Of course, part of this is attributable to socioeconomic reasons for our lower savings: Many folks are still recovering from the Great Recession; wage growth has been pretty stagnant; and high levels of student loan debt are weighing down many Americans’ finances.But even people who are on a tight budget can consider Radcliffe their financial Patronus, the apparition that scares away happiness-stealing dementors and finds new ways to save. Here’s how you might be able to get some more galleons in your vault.* Automate your savingsWe all know we shouldn’t spend more than what we have. But if this is a challenge for you, consider setting up an automatic transfer so at least some of your extra funds (after paying your bills) make it into your savings account. You can apply a similar strategy to your investments and increase your 401K contributions from each paycheck.* Improve your creditA good credit score can help you save on everything from mortgage rates to insurance policies. So if your credit is a little lackluster, it might behoove you to put in a little work. You can improve your scores by paying down high credit card balances, disputing errors on your credit report, and identifying specific areas where you need to improve. You can find out what these areas are and monitor your progress toward building great credit by viewing your free credit report summary, updated every 14 days. Improving your credit will lower your expenses and give you extra money to sock away.* Find ways to generate more incomeThe gig economy is real and, in many respects, thriving,

Scammers In IRS Clothing Are Targeting College Students

With Kelly Erb, tax specialist and writer for Forbes.comSeniors aren’t the only group targeted by scammers. On the other end of the spectrum, college students are perfect prey for fraudsters in IRS clothing.Kelly Erb, a tax expert and writer for Forbes.com, has investigated what’s behind a new warning from the IRS regarding a scam aimed specifically at college students. In this case, the scammers phone the students saying that they owe a federal student tax which must be paid immediately by wire, usually by Moneygram, an untraceable form of payment, and, if they don’t comply immediately, the police will be contacted.First of all, there is no such thing as a federal student tax; it’s simply another device aimed at this specific group of young people. The tactics used to frighten these students—who otherwise might be skeptical—include giving them information such as where they go to school, where they live, the name of a parent perhaps, and even their social security number, anything to make the caller sound legitimate. These schemes can be particularly frightening for a student dependent on student loans or financial aid and is unaware of tax laws or how the IRS works.Kelly stresses that, no matter what the case, we should all be aware that the IRS will never make initial contact over the phone or via email. If there ever is an issue, the IRS will send a written letter through the mail stating exactly what you owe and why; and, furthermore, they will never call asking for verification of information. If that happens, you can be assured the scammers are on the other end of the line.If money is legitimately owed to the IRS, they also will never demand payment in one form only, such as a Moneygram or a debit card, or even—and this has happened—with gift cards. Kelly says that over a million dollars have been paid out to these crooks in ITune cards from unsuspecting victims.And never, never, she adds, should you engage with them over the phone thinking you can scare them because, as she says, “the problem is that these scammers, once they realize that you're an easy victim and they get what they want, they don't stop calling.  They actually ramp up their efforts.” And then “the chances of you getting tricked are even greater because they can actually coax information out of you, maybe not money, but information about you that is very, very helpful to them, such as you might say, ‘I'm going to tell my dad.  He's a lawyer.’ " Kelly has a cautionary note for anyone who may be in default of student loan payments at some point in their lives: Never ignore any legitimate contact from the IRS concerning money that you owe for student debt. You can be assured you won’t be shipped off to debtor’s prison in some remote penal colony, but you will need to respond appropriately and to show up in court, if necessary.As for targeting those scammers who are targeting vulnerable students, the IRS has issued a new warning at the beginning of this school year to both students and their parents to be vigilant and on the lookout for the bad guys on the phone or on your email.

How To Think About Money

With Jonathan Clements, award winning financial writer and author of How to Think About MoneyRewiring our brains is difficult no matter what the focus, but since we homo-sapiens have been hardwired from our hunter-gather ancestors to fail at money management, saving and investing for our financial future is particularly challenging. So says Jonathan Clements, longtime personal finance columnist for The Wall Street Journal and author of the new book How to Think About Money.We’ve been told to work like crazy for several, maybe four decades, of our lives, saving as much as we can along the way, doing all the right things, before retiring and then spending the next 25 to 30 years on golden pond living off the fruits of all that past labor.Jonathan’s position turns this conventional retirement “wisdom” upside down. For a number of reasons, this old way of thinking just doesn’t work in today’s culture: not only does it lead to boredom and lack of purpose, but since we can expect longer lifespans, we may not have enough money to see us through to the rest of our lives.At least half of all males who are age 65 today have a life expectancy of 84 and for females that number is age 88. In fact, life insurance companies are now running illustrations out to age 115, which gives you some idea of the projected rise in mortality.Throwing in the towel at the traditional age 65 increases the vulnerability of outliving your money, especially factoring in an unexpected low-return financial environment or perhaps cuts in Social Security. Adjusting to such uncertainties would be hard and, even though one can cut back on expenses such as travel and entertainment, it could also be devastating to your financial security. According to Jonathan, moving the retirement age up to 70 is a partial solution to this problem.But the better way is to envision a gradual retirement phase whereby you pursue a passionate existence without a paycheck being the goal. “Doing something productive with our retirement years,” says Jonathan, “could actually make for a more meaningful retirement. Maybe we start to engage in part-time work.  We continue to get some money.  We continue to contribute towards society.  Thanks to that, we also find it much easier to pay for retirement because we're not starting to run down our retirements, maybe even starting in our early 60s.”Jonathan also has an against-the-grain idea of how young people should proceed toward the future. The current trend seems to be you follow your passion in your 20s—whether that be as a rock musician, a poet, or as a planter of organic seeds in fertile farm land—before getting on to the serious part of earning a living. Jonathan says, “I actually think that that's total nonsense, and, in fact, the total opposite is true.  Psychologists make this distinction between extrinsic and intrinsic motivation, or external and internal motivation.  People, when they're in their 20s, are greatly motivated by external rewards.  They want the promotions and the pay raises.  By the time you get to your 40s and 50s, those are less important.  Instead, you're more focused on doing things that you personally think are important. In your 20s is the time to learn the rules of the work world; you're highly motivated by those external rewards.  Once you get into your 40s and 50s,

Market Insights Of George Soros

George Soros is a living legend among traders. With a net worth of $28 billion, he is the richest market speculator in the world. He is known for big, bold bets, and his success as a trader offers a few lessons to everyday investors.Soros’ trading philosophy can best be described by two phrases:“It doesn’t matter if you are right or wrong, but how much money you make when you are right, and how much money you lose when you are wrong!”And…“When you have a tremendous conviction on a trade, you have to go for the jugular. When you are right on something, you can’t own enough”.Now, I would not recommend this two-phase strategy to my listeners because, remember, Soros invests disposable money from high-net-worth individuals and disposable money from his own pocket. So if his bets go bad, he and his investors still have millions laying around and can afford to absorb those losses, which is not the case for most of us. If you want to emulate Soros, make sure you do so with only a small disposable part of your portfolio that you would not mind losing entirely.So here are a few tidbits of market insights that reveal how Soros thinks about financial markets:Soros believes market prices are almost always wrong and present a biased view of the future. He believes that markets are always biased in one direction or another. They are either too bullish or too bearish, and here’s the revolutionary thought: What the market actually does influences the events that they anticipate. I’ll get into that more in a minute. These movements are easy for him to see in financial markets. He sees buy and sell decisions, which are based on expectations about future stock prices and future prices, in turn, become contingent on present buy and sell decisions.So there’s essentially a circular relationship between cause and effect with each affecting the other in what’s basically a Catch 22. By the way, if some of you don’t know about Catch 22, look it up. It’s an important concept you’ll run into in your own life from time to time.Also as we use fundamental analysis to attempt to determine the future value of a company, the daily movement of stock prices also influences those fundamentals. As a result, buy and sell decisions are more complicated in the short term, and that’s one reason short-term trading is so darn hard. It’s most likely a game that you are going to lose, and it’s a game that even the most highly trained professionals struggle to overcome. Now this is a tough game when trading on a short-term basis. In the long term, however, these influencing type factors disappear and fundamental analysis will likely work well.Let’s talk about Soros’ view of bubblesWhen Soros sees a bubble forming, he rushes in to buy, adding fuel to the fire, pushing the stock higher just by the act of buying a big chunk of it. By the way, if you follow the markets like I do, you will see days when stocks move strongly in one direction or another for no apparent reason. Well, maybe George Soros is doing something on that day.In Soros’ view, every bubble has two components: The first component is an underlying trend that prevails in reality that fundamentally tells you whether a company is worth investing in or not, and the second component is a misconception relating to that trend. What sets the bubble in motion is when positive feedback develops between the trend and the misconception. In other words, when the trend is positive and leads to a huge surge in buying because everyone is jumping on the bandwagon, this takes the stock well above its underlying fundamentals.As the bubble inflates, short sellers, fundamentals, and plain-old “profit taking” test the bubble with short selloffs along the way. When shares survive these tests, both the trend and the misconception are reinforced, driving shares even higher after a brief selloff. But, eventually,

Everything You Need To Know About The Real Estate Market

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLIt might seem like you need a divining rod to predict the way the real estate market will go at any point in time, but, from all her years of experience, Terry Story usually can foresee the future highs and lows all by herself.Citing some information from the fall 2016 Housing and Mortgage Market Review published by Arch Mortgage Insurance Company, Terry says the likelihood of home prices declining over the next year or so is very low. Speaking specifically of the South Florida market, although prices are still rising and inventory is relatively flat, the housing market is in a period of stabilization. Since there is a need here for more inventory, the risk of declining seems to be minimal.In those parts of the country affected by the coal, oil, and natural gas industries, those areas which are economically sensitive, Terry says there is evidence of some softness in housing prices.One thing to remember is that because many people coming out of the last recession who received loan modifications that have now reached their time limits, you may see a bit of an increase in short sales if those individuals haven’tbeen able to build up enough equity in their homes to be able to sell.Terry interjects that of all the best areas for real estate investors to invest, Florida again dominates the top 25 list. These are the places with the largest year-over-year rental rate increase.A recent and frequent topic of discussion among realtors and their clients has been the idea of multiple offers coming in for a single property. Terry offers some useful tips for negotiating these multiple offers:* Offer an increased amount of earnest money upfront.* Send the offer with a bank statement or such verifying you actually have the funds.* Give the seller some flexibility moving out, perhaps allowing them to remain in the house after closing.* Don’t include contingencies like the sale of your own property.* Don’t ask for home warranties and termite bonds.* Don’t demand the seller pay part of your closing costs.As an agent, Terry says, “you're not allowed to discuss motivation, unless the seller allows you to do so. Getting that kind of information may be difficult. It'd be great if you have it, but that's all part of the negotiating.”That being said, a good real estate agent can make the negotiations much easier. After all, experience counts.

The Highs & Lows Of Housing Inventory

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLTerry Story has been talking for months now about the lack of inventory driving up prices in the real estate market and generally making it increasingly more difficult for buyers to find what they can afford. Because location is sometimes everything, Terry explains that there are geographical exceptions. Trulia, the online resource for real estate listings, cites six metro areas currently recording annual increases in inventory: Fort Myers, Miami, and Sarasota, Florida; Las Vegas, Nevada; Fresco, California; and Oklahoma.  Interestingly, these are also the areas having had the biggest declines in the market crash of 2006.Narrowing the discussion down to the South Florida market, Terry shows a bit of a recent decline in inventory causing a rise in prices and resulting in an average of 75 days for a home to sell. Most of the new housing construction, she said, is not taking place in her particular area, but more to the north and west of it.Perhaps an indication of an overall confidence in the economy is at the root of the increase in real estate investments Terry sees going on.  As opposed to what might be the more profitable venture of investing in stocks and bonds or even gold, many people like the sense of owning something they can feel and touch, the bricks and mortar sense of things. A note of caution with a real estate investment, however, is the difficulty of liquidating quickly if need be.The question posed for this week’s segment we call “Ask A Real Estate Pro” is, “Can a home owner's association charge owners extra for gate control access?”  Terry answers, “Absolutely.  They can pretty much charge for anything that they want.  You see this all the time.”  And owners should be aware that if they don’t possess a copy of the HOA documents for the buyer, they may be charged for a new set, including application fees, by the home owner’s association.It’s wise to know the rules before going into negotiations of any kind and, before venturing into the real estate market, a qualified realtor is your best ally.

How To Dig Yourself Out Of Debt

As you know, debt is just another term for money that you borrow and need to pay back to someone.  Typically, you have to pay back with added interest and the rate that you pay is determined by factors such as your credit rating and whether the debt can be backed by assets, such as your car or house, which are called collateral. The better your rating and the better the assets, the lower the rate.There are times—especially when interest rates are low, as they are now—when it simply makes more sense to borrow to make a purchase, instead of paying cash. If you purchase a house and pay 3.5% for a mortgage or a car (paying next to nothing, really), then you most likely want to borrow the money rather than pay cash.Moreover, most Americans simply do not have the spare cash laying around to make these big purchases, so they do have to resort to borrowing. Debt is essentially a reality for most of us, whether it be for a home, a car, appliances, student loans, or something else.As a matter of fact, an analysis of the Federal Reserve and government data shows that Americans collectively owe a whopping $712 billion on their credit cards, which is about $15,400 per average household, with that average household paying $6,700 in interest on all their debt each year. That eats up 9% of the average household income.Inevitably, most Americans find themselves in debt at some point in their lives. Ideally, if you are careful about taking on debt your monthly debt-related payments will be well within your monthly paycheck. At other times, your debt level might be just high enough to make you uncomfortable or, at worst case, might become a crushing, sleep-stealing weight that you just can't handle anymore.Four Ways to Get Out of DebtI want to talk about 4 ways to get out of debt. Small or big, there are basically only 4 ways—from penny pinching on one end of the spectrum to bankruptcy on the other, and the right method will depend on your circumstances.All of them have this first step in common, and that's building a realistic budget. Many people don't have a great handle on where their money goes. To free up money to pay bills, you have to first see what kind of money is available. The best way to do that is by tracking your spending for a few weeks, maybe a few months. That's not so hard because there are plenty of online tools and mobile applications that can help you get a true picture of your finances and show you those areas where you can cut back on your spending so you can start paying your bills off steadily.By the way, this the same for all, no matter how much money you have. With exception of the Warren Buffets or the Mark Zuckerbergs of the world, everyone has limited resources, whether it be millions, thousands, or hundreds. Each of them has to allocate their resources and spending based upon these limitations. For those with relatively small debts, the simple belt tightening might be all that is needed to free up the money to pay off the credit card balance.Online tools such as the payoff calculator at creditcards.com can tell you how long it will take to pay off your debt under various scenarios. Try the one at creditcardfinder.com, which allows users to input information for up to 9 credit cards and then obtain a ranking of which cards to pay off first. That is pretty cool.Some of you may have money saved in retirement or in investment accounts and may be tempted to break into those to pay off debt. But think again—not only will you lose hard won savings, but you will also miss out on any gains you might have made in the stock market, thereby compromising your retirement security.Be aware that you'll have to pay a tax penalty if you withdraw from a 401K or an IRA before age 59 and 1/2. I dislike this approach because it doesn't impose an...

When Scammers Come Calling, Know What To Do

With Blake Ellis & Melanie Hicken, Investigative Reporters, CNN Scams come knocking from all sides: They arrive in the mail; they show up in our inbox; they call us on the phone, and they particularly target the elderly.Blake Ellis and Melanie Hicken of CNN Money recently broke a story about a global mail scheme that turned out to be one of the largest in the history of the Department of Justice.Impaired cognition, desperation, or naivete’ often drive older people to fall prey to acts of fraud which can leave them financially devastated. The sophistication behind these come-ons is startling and quite frightening—they offer big prizes, answers to life’s questions from “beyond”, and they always require you to send money, sometimes even a small sum, to get to that pot of gold. Of course, that pot of gold never appears.While investigating acts of consumer fraud, Blake and Melanie were scanning through a pile of junk mail and came upon a letter from a French psychic named Maria Duval, which led to their uncovering a massive scam. They initially discovered that over the course of almost 20 years, the Maria Duval scam had bilked more than two hundred million dollars from the unsuspecting in just the United States and Canada alone. Was there actually a Maria Duval? They had to go all the way to France to find out that she did, indeed, exist but was now too elderly and ill to even be interviewed. Information from her son revealed that, although she had gotten some money herself, she was just another victim of the scammers who used her name and picture to their advantage.Whether it’s the Nigerian minister scam, the winning Sweepstakes in the mail, a financial windfall scam, or Maria Duval divining a prophecy, what all these schemes have in common is money being sent and checks being cashed. Following the money trail is what led to the stunning realization that one company in Canada called PacNet was responsible for processing payments for multiple fraudulent schemes. Maria Duval was only the tip of the iceberg.When contacted and questioned by Melanie and Blake, the officials at PacNet claimed to be innocent of any wrongdoing and that they too were victims of the scammers. Not only were they processing all these payments, they also obscured where the money was going and engaged in a whole host of shady and nefarious evasions. Even after receiving stern warnings from the government, PacNet denied culpability and continued to operate as usual.But the government was just as persistent and the U.S. Treasury eventually took the unprecedented action of adding PacNet to a blacklist along with some of the most dangerous and deadly criminal cartels, drug dealers, and murderers. PacNet is the first of its kind to be on this list.Now that it's designated as a transnational criminal organization, U.S. companies and individuals are banned from doing business with PacNet, so it's cut out of the U.S. financial system entirely.  It can no longer prey on victims here in the U.S. and will be unable to do business with many international banks as well.It's going to be very hard for PacNet to continue doing business anywhere, and that’s a very good thing. These scams are taking away the only money many of the elderly have. The sad part is that, like the Whack-A-Mole theory, you can punch one down, but another will pop up somewhere else. Thanks to the dedication and persistence of people like Melanie Hicken and Blake Ellis who go after these deplorable scammers, many of their plots will be foiled.  You and I can do our part by looking after our elderly parents and neighbors. 

What To Do With Your Money During The Presidential Election

I want to talk about some of the ways either a Clinton Presidency or a Trump Presidency could affect your finances—with a little bit of my opinion thrown in.Let’s begin with Hillary.How A Clinton Presidency Could Affect Your FinancesAlthough she’s been fairly quiet since her official nomination, Hillary Clinton has consistently presented a platform of changes focused—as she says—on American families. She has proposed four key programs that support her campaign’s Families First theme, starting with free preschool for every 4-year-old in the U.S. as well as paid family leave for new parents. For students, she’s proposed debt-free college options for state universities and community colleges. Finally, for seniors, she’s mentioned an expansion of certain Social Security benefits.In her first 100 days, Clinton plans to increase infrastructure spending, essentially earmarking $275 billion to improve, repair, and maintain roads and bridges across the nation. A number of economists feel that the jobs created by these projects could boost the overall economy and growth rate, but we can’t ignore the hefty price tag they bring, which will squeeze some families harder than others. Who will get squeezed and how hard? Well, Clinton intends to raise the tax rate on those who make $1 million or more, ensuring that this group pays a minimum rate of 30 percent. Those who earn more than $5 million will be subject to an additional surcharge of 4 percent. In addition, she plans to cap itemized deductions at 28 percent and to reduce the threshold for estate taxes to $3.5 million down from the current 5.5 million, while imposing a 50% rate for estates worth over $10 million per person, 55% for estates over $50 million, and 65% for estates exceeding $500 million. Lastly, she has mentioned increasing the wage ceiling for Social Security payroll taxes, which is currently at $118,000.My commentary: This is, essentially, a model for the redistribution of wealth, something that benefits one end of the economic spectrum far more than the other. With the expansion of entitlement programs, benefits focused on middle-and-lower-income households, and the infrastructure spending (which will all be funded by higher-earning households), a Clinton presidency seems focused on taking from the wealthy in order to benefit the middle class and the poor. I think she would agree with my assessment.How A Trump Presidency Could Affect Your FinancesIn spite of the many conflicting statements Donald Trump has made on a variety of topics, there is one subject he’s been clear on. His goal as president would be to put America First by helping ensure that we come out ahead in trade deals and keeping more companies operating on home soil. Two ways he plans to do that are by taxing goods coming in from Mexico and China and by reducing corporate taxes to 15 percent, a measure that will make corporations think twice about moving overseas.While these plans sound great, we should remember that for every action there could be an equal and opposite reaction. It’s possible that the tariffs could work against us by increasing prices to a point that consumers won’t be able to afford. It may also push manufacturing to other parts of Asia rather than bringing it back home. Looking back at history as an example, it’s worth noting that one of the reasons behind the Great Depression was a rise in tariffs and protectionism. Reagan, too, had mixed results imposing tariffs on the Japanese in the 1980s.It’s not all business tax and tariffs for Trump, however. Families who pay for childcare and eldercare may enjoy larger personal tax deductions under a Trump presidency, although this change won’t really help the more than 45 percent of Americans who pay no federal income taxes. Social Security and Medicare recipients are unlikely to suffer a reduction in benefits, but Trump has not rejected the idea of some entitlement cuts.

4 Key Words You Need To Use When Selling Your Home

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLWords matter when you're selling your home. Using the right words and phrases will make a difference in how long your home is on the market and what the sales price will be.Terry Story, our resident real estate expert, tells us that Core Logic researched this idea and listed the impact certain words had on the process.* Fenced in backyard: This conveys a place of privacy and security for children and pets, and so is viewed as a positive.* Open concept, natural light, open kitchen: These words are used to describe a sense of space which appeals to most home seekers* Gourmet kitchen, ceramic tile, granite counter tops: Gourmet kitchen may imply that the price of the house is too high to compensate for the owners having put in an expensive kitchen—also too few people even cook today. Interestingly, both ceramic tile and granite are now passe—the new magic word is quartz. So all negatives here.* Golf course lot: The negative here is that it often implies a country club community requiring membership fees.For Terry’s “Ask A Real Estate Pro” segment, we were asked the question:"We bought a home two years ago with an FHA loan and an interest rate of 4 1/2%.  As part of our monthly mortgage, we're paying mortgage insurance. I've been receiving offers in the mail to refinance at a better interest rate to lower our payments.  Is this something that we should do?"Terry’s answer: “If you put down less than 20%, this insurance protects the lender from you going into default or foreclosure. It runs about $150 a month. So if you can put down 20%, you’ll save in the long run.”Regarding refinancing, if you plan on moving in 2 or 3 years, you do not want to refinance. If you have close to 80% equity in this house, “then it would be wise to go ahead and convert to a conventional loan.  By doing so, you're going to probably save closer to $250 a month based on the average loan amount at 3 1/2%, plus the savings of that mortgage insurance that you're no longer having to pay.  Keep in mind, to refinance, it's not free.  There are costs associated with that.”Another question posed to Terry concerned condo rules which were being ignored by multiple owners. “By ignoring the rules for a long period of time, the association has lost the rights to enforce them.  The board would need to call a meeting, properly pass a new resolution, and then inform the owners that all the new violations will be addressed.”

Conventional Wisdom Regarding Your Mortgage

With Holden Lewis, Senior Mortgage Analyst and Senior Editor at bankrate.comThe conventional wisdom regarding home mortgages is that the 15-year is better than the 30-year plan in the long run. After 15 years, you’ll own your home free and clear, a basic tenet of the American dream, and you’ve paid fewer fees and a lower interest rate.Holden Lewis, Senior Editor at bankrate.com and a senior mortgage analyst, recently wrote an article focused on the drawbacks of taking out a 15-year mortgage, why people typically opt for them as opposed to a 30-year mortgage, and why they often refinance at some point into that 15-year period.On the surface, it appears that the main drawback of the 15-year mortgage is a higher monthly payment. Holden says that part of the appeal is the emotional satisfaction that comes with knowing you can have your home paid off in a shorter period of time and, that when that day comes, no matter what happens, your safety net, your security zone, is that home.But a deeper analysis reveals that having a 30-year mortgage actually gives you more flexibility and security in hard times. As Holden explains it, “Let's say the car needs a big repair and someone is hospitalized.  All of a sudden, you’ve got all these huge bills.  If you have a 30-year loan with that smaller monthly payment than a 15-year loan, then you just have more room to pay all of your bills, including your mortgage.” You’d be better prepared for any of life’s unexpected events.He advises taking out a 30-year loan and paying extra on that mortgage each month as long as you can. Assuming there is no financial crisis along the way, you have the potential to have the same benefits of a 15-year loan with less interest paid and full home ownership in less time.With a 30-year loan, you also have the option to refinance into either a 15-year loan or into another 30-year loan with a lower interest rate. “If you refinance into another 30-year loan under the scenario I have,” says Holden, “if you pay an extra $530.00 a month on this $200,000.00 mortgage, you'll end up paying it off in 15 years, but if you get a 15-year loan, it's $73.00 less than that $530.00 extra.” You get a break on the interest rate with a 15-year and, again assuming a $200,000 loan amount, you would be ahead $73 a month, an amount you can use for savings.Paying less on that monthly mortgage offers the possibility to set aside an amount to invest in, perhaps, a basket of common stocks such as the S&P 500, which over a 10 or 20-year period, statistics show would have a higher rate of return than investing in your home.In addition, cautions Holden, “…it would be utter madness to be paying off your mortgage in 15 years when you're carrying a balance on a credit card that has an interest rate of 12% or 18%.”  So before you go for a mortgage, know all the facts and determine what’s in your best interest.

Buying A New Home In This Changing Real Estate Market

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLTerry Story always knows which way the wind is blowing in the real estate market and now, she reports, home prices are taking a turn after years of rapidly accelerating price gains.The Case-Schiller Report shows home values still soaring in the northwest, but slowing down in other parts of the country because of a dwindling supply of inventory.Prices can only go up so high since they have to keep up with incomes. If prices rise past the ability of those who buy these homes to afford them, they can get stretched which we saw back in the bubble of '05.  High home prices and low inventory are driving more people toward renting instead of buying.Another problem Terry notices is that many lower-end buyers can’t find what they thought they could get for the money and so they become discouraged. Oftentimes, then, they’ll settle for a desired neighborhood and end up buying a house that needs fixing or renovating, which enables them to make it more like a new home, one closer to the original dream.There is help with financing out there, Terry says. The FHA offers a 203K plan and, in Florida, this can get you a mortgage up to 340,000 which includes money for repairs, which often solves a problem especially for young first time home buyers who don’t have the extra 20 to 30 thousand dollars for improvements.Fannie Mae also has a program called Home Style Renovation that lets you mortgage up to $417,000, but repairs can’t exceed 50% of the value after appraisal.Terry has advice for how to prep your home for sale: Clean, clean, clean, she urges, and purge of your home of knick-knacks, family photos, and all other clutter. Make it as much like a model home as possible by de-personalizing the space and fixing items that are in visible need of repair. As a final note, she says to make your environment look and smell good—so deodorize, spruce up the landscaping, add fresh mulch and flowers, and present a clean and orderly garage.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Roundup.  This is time every single week we get together with noted real estate agent Terry Story.  Terry is a 27-year veteran with Coldwell Banker located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: After years and years of home price gains and almost at an accelerating pace, I think the tide is turning a little bit.  Tell us about home prices these days.Terry Story: You know, Steve, according to the Case-Schiller Report, they do analyze the 20-city home price index, there's a little bit of a slow down.  What we're looking at, home values are still soaring in the northwest.  That place is on fire, but we're starting to see slow downs nationwide.  Prices are increasing, but slowing down.  However, they're still increasing more than buyer’s incomes.  What's happening is we're now getting into a dwindling supply of homes available.  That's just changing the dynamics a little bit.  For example, homes in the northwest, they climbed at a double-digit pace; we're looking at 12%.  Cities in the Midwest, that was kind of a mixed bag.  The southern areas, we saw stronger price gains like Dallas, Atlanta, Tampa area, and then the index plunged.  The index did plunge after the housing burst in 2006.  It actually plummeted by more than a third before the prices started to rise again back in March of 2016.  We're starting to see overall just a slow down in the price gains which is no surprise because there's a ceiling.  You can only go up so high.  People's incomes have to be able to keep up with this.Steve Pomeranz: Yeah, I mean, trees don't grow to the sky.

The Art Of Saving For College In 5 Steps

Here’s something we all know from hearsay: College expenses have been steadily rising over the years.For example, just annual tuition and fees (not counting room and board) for a four-year college degree at a public university cost $2,400 on average in 1975. That same four-year public university degree costs $9,400 per year in the 2015-16 school year (in 2015 dollars) which is still a bargain compared to the $32,400 in annual tuition and fees you’d have paid at a private four-year college in 2015. But, public or private, you’re looking at about a 3.5% annual increase in tuition and fees. And while that may not seem like a lot, it adds up quickly year-after-year, especially if you have a newborn and you’re looking at where fees might be 16 to 18 years from now.So how do you plan ahead so you have enough to cover your child’s tuition and fees several years down the road??Thankfully, it’s not that hard to figure out. With some thoughtful planning, you can come up with a reasonable estimate of your “magic number” for saving for college.So here’s what you need to consider as you start planning ahead:1) The type of school you’d like your child to attend: The cost of attendance varies greatly depending on whether you want a two or a four-year school and whether it’s public or private. Costs ranged from around $11,000 to about $44,000 (including room and board) per year in 2015, according to a recent survey from the College Board.Also, many of my clients have a sense of the kinds of students their children really are, even at a fairly young age. If they’re honest, they can make an educated guess whether the child is Harvard bound or state college bound. So they can plan accordingly.2) Room and board: Room and board, which accounts for a large portion of the cost of attendance, is one area where you can save money by having your child live at home for the first year or two if that’s feasible. Though let me warn you, that’s likely not going to go down well with your college-bound freshman who’d rather be on-campus enjoying the “college experience”.3) Inflation: According to the College Board’s recent study, prices increased by about 3% from the 2014-15 school year to the 2015-16 school year.  It’s best to err on the side of caution and choose a relatively high rate of inflation, say, 5%, as you calculate how much money you’ll need to save.4) Price actually paid: Thankfully, many students don’t pay full price because of institutional and federal grants and tax benefits. So, depending on your financial circumstances and your child’s educational prowess, your child’s four-year degree could cost between 10% to 25% less, but I’d rather you not fall short, so save the full amount and consider money saved to be a bonus after the fact.5) Your child’s contribution: Many parents believe that their children should help pay for school through work or student loans. If you decide to have your child contribute, make sure he or she is aware of the risk and burden involved in taking on debt.Now let’s put this all together with an example. Say you’re a newly married couple and want to plan for college for your new baby, and you already have a type of in-state school in mind. Figure out the estimated in-state cost of attendance for 2016-17 at that university—let’s say it’s about $26,500 in total per year. Now, figure out how much you’d like your child to contribute; say you decide your child’s share should be around $12,000 of that $26,500.So your contribution works out to $26,500 less $12,000, which is $14,500 for the first year. Increase that by 5% each year and you’re looking at $15,200 for the second year, $16,000 for the third year, and about $16,800 for the fourth year. Add it all up and you’re looking at about $62,500 in today’s dollars. Now factor in college expense’s inflation of 5% over the next 18 years, so that’s $150,

How To Vote & Invest Without Fear In This Presidential Election

With Michael K. Farr, CEO and Founder of Farr, Miller & WashingtonIt’s been an unusual year in the market: The S&P had been down 12% at one point; Brexit created a case of global economic jitters—then the market rallied and hasn’t stopped since. So what’s going on and where do we go from here?Michael Farr, a CNBC contributor and President of the DC investment firm, Farr, Miller & Washington, and a frequent guest on On The Money, offers a thoughtful and interesting analysis to help us make sense of recent events shaking up the stock market as well as our collective sense of economic security.Michael believes that rapidly occurring global and national news-making events cause what he refers to as distraction amnesia, where we barely are able to process one crisis before another headline comes along at whiplash speed grabbing our attention and switching our focus. So we’re skipping around from one panic mode to the next: it’s Brexit, then it’s rising or falling oil prices, then terrorism or some other factor beyond our control. Before you know it, we’re investing from an emotional position which, Michael says, is the fall of the long-term investor.Brexit created an atmosphere of fear driving some investors to panic and sell, which turned out to be a big mistake when the market quickly rebounded from a slight downturn. Now our attention is focused on the presidential election campaign and, once again, emotion is steering the ship, but this time, it’s not fear so much as anger that’s at the emotional core. Michael points out the extreme polarizing sense within this current election debate—no matter if you’re a Trump or a Clinton supporter—emanating mostly from the “economic disparity we’re seeing among socioeconomic groups”, from “a middle-class that hasn’t seen any real wage gains adjusted for inflation since 1997. There's a large part of the population that is feeling disenfranchised, in many ways voiceless, unrecognized,” says Michael, “and they see the election and other areas as ways to lash out and try to be heard, but they're shouting.” As unsettling as this political clamor or any other screaming headline might be, it’s crucial to leave emotions out of the voting booth and your investment choices. Market fluctuations will continue to occur, but the Federal Reserve continues to feed liquidity in the marketplace and to keep interest rates low. Will we see those rise in the near future? No one knows for sure, but Michael quotes one Governor as saying he would need to see evidence of more inflation before he would support a rate hike this year.Avoiding the inevitable distractions in our present world takes resolve and emotional strength. Michael Farr’s advice is to listen to the words of Steve Pomeranz: “Nobody can really figure out the mechanism behind or against rising markets and especially regarding what's going to happen in the near future.  You've just got to focus on what you own.  Sometimes that stuff's going to be overvalued, sometimes it's going to be undervalued, but underlying these securities is wealth creation for shareholders.”So, concludes Michael Farr, buy good stuff and hang on to it.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: I'm very happy to welcome back Michael Farr.  Michael's an award-winning author, CNBC contributor, and president of the DC investment firm, Farr, Miller & Washington.  We've discussed many issues on this show, and I wanted to ask him to come by and see what's on his mind because we've had kind of a wacky year.  Welcome to the show, Michael.  Welcome back.Michael Farr: Thank you, Steve.  It's always good to be back with you on On The Money.Steve Pomeranz:  Hey, you know, I was just thinking, this year has been so strange.

Five Easy Fixes For A Better Economy

With James M. Stone, Author, Founder and CEO of Plymouth Rock Assurance Corp., Former Massachusetts Insurance CommissionerSince we’re in a Presidential campaign cycle, the problems and challenges of our country are front and center, and we’re continually bombarded by rhetoric from all sides on how to fix what ails us.James M. Stone, CEO of Plymouth Rock Assurance Corp, former Massachusetts Insurance Commissioner from 1975 to 1979 and then Chairman and Commissioner of the US Commodities Futures Trading Commission, has written a book called Five Easy Theses: Commonsense Solutions to America’s Greatest Economic Challenges, in which he addresses matters of public policy regarding healthcare, education, inequality, and social security—those issues that concern all of us.Jim states at the outset that there are other matters of equal value, both on a national and international level, and he doesn’t assume to have easy answers across that vast spectrum. The book, instead, focuses on the areas within his level of expertise.There are two types of federal policies steering the economy, explains Jim: one is the monetary policy resulting from the action of the Federal Reserve’s manipulating interest rates and the money supply; the other is the fiscal policy that is the product of government spending managed by Congress, which is at the core of Jim’s message.Jim believes that the problems around social security have got to be considered sooner rather than later, and the simple solution, as he sees it, is to begin raising the eligibility age now before we arrive at the critical stage. To use his metaphor, “Now we’re a speeding car heading toward a brick wall.” At the inception of Social Security, life expectancy in the United States was only in the 60s, whereas since then, it’s risen dramatically and is expected to keep on rising. We’re a much younger older population.Regarding the high cost of our healthcare, Jim’s first line of attack is to lower the cost of pharmaceuticals. He makes the alarming statement that “no other developed nation in the world spends more than about 10% of GNP on healthcare.  We spend 18%.  That's more than a trillion a year… and we are not able to show that we get better infant mortality, better life expectancy, better healthy lifespan, better obesity.  We don't get better anything, but we spend over a trillion dollars a year more than we have to.”Part of his answer to this problem is to shorten the time span on the patents for these drugs but to have the rest of the world who benefit from our research share in the cost. At the moment, the US shoulders most of that burden.Right now the overall insanely high cost of healthcare is affected by the enormous amount of paperwork required for different insurers and different programs, as well as sales costs for marketing, which could be greatly reduced if the government were to act as administrator, thereby eliminating much of the paperwork. He cites the statistic that 20% of all healthcare dollars is spent on marketing and administration; most other nations spend 2 or 3%.Other changes Jim proposes are eliminating many of the subsidies as well as interest deductions.  “If you add up what the home mortgage deduction and the corporate interest deduction costs, it’s just about equal to the whole deficit.”When Jim discusses income inequality, he says that “wealth inequality is much more unfairly distributed than income.  The wealth numbers are really striking.  It appears that in the last 40 years, the United States created more wealth than any other country in the history of the wor...

How To Position Yourself To Get The Best Real Estate Deal

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLBuying a new home is one of the most exciting events in a person’s life, but it also can be one of the most frustrating. Instead of going into a state of high anxiety, consider allowing a professional real estate agent to guide you through the process from start to finish.Even though the economy is good and interest rates are low right now, the real estate market is in constant flux.  With her 27 years in the business, Terry Story has learned how to ride through the changes and negotiate the best deal for her clients.Terry says that prices are higher across the board right now because of low inventory, so it’s important to know how to position yourself to get the best house for the money. At the beginning of the search process, Terry advises prospective buyers to have realistic expectations, to not go in looking for the elusive perfect house, but to expect to make some compromises and to stay focused on those points most essential to you, like being in the right school district.Your qualified agent can also be your best source of information when it comes to qualifying for a mortgage. No longer is a 20% down payment a requirement; it can be as low as 3%, and if you’re a veteran, 100% financing could be possible.Many people today are purchasing homes governed by a mandatory homeowner’s association. It’s critical for the buyer to have a copy of the HOA documents before signing the contract since there may be some restrictions or rules that are unacceptable and may be cause for not purchasing in that particular neighborhood. It’s the buyer’s responsibility to ask for these documents in advance, and a good real estate agent will make sure that happens.A complicated situation could occur if the unthinkable happens and the buyer dies prior to the closing. Terry says she recently experienced such a predicament where one of the spouses passed away and the surviving spouse didn’t want to go through with the transaction. A real estate attorney was called in at her suggestion which then resulted in a reasonable resolution for all.So since your realtor can be your greatest advocate all through the home buying process, finding that person you can work with is your best first step toward a happy conclusion.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for real estate roundup.  This is the time every single week we get together with noted real estate agent, Terry Story. Terry is a 27-year veteran with Coldwell Banker located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: So, Terry, the economy is improving, interest rates are low, and many consumers now find themselves in a position financially to become a first time homeowner.  However, there are some frustrations that people are experiencing right now.  Let's talk about them.  What's one of the first frustrations that a new time home buyer might encounter?Terry Story: Sure, well, first of all, don't get discouraged.  The first thing that I find is they can't figure out the home buying process, and that's what realtors are for.  Really if you're a first time home buyer, don't try to do this on your own.  Get yourself associated with a good realtor who's familiar with the area that you're looking for.  It can be a very frustrating process, but if you have a professional guiding you, it'll make this process so much easier.Steve Pomeranz: It's like anything else that you attempt to do.  There's complications to it.  There's details that…we don't really do this for a living, so, therefore, you can read all the articles you want or maybe even a book or two and that's just wonder...

Luxury Home Sales In A Holding Pattern

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLTerry Story always reminds us that all real estate is local and so even when talking about high-end housing, the luxury market, it’s no different.Since February 7, the number of luxury homes for sale in our area (those priced between 1 to 2 million) jumped from 7 to 18, that’s over 100 % increase, but there has been only one sale during that period. So clearly there’s a stall at that level.The median price here in South Florida is in the $500,000 range, which is over double the median price nationwide. This is the range of the move-up buyer, the executive type buyer, the relocation buyer, and these homes were moving up until late 2015. Then sellers began to hear that the market was going up 3 to 4%, and they then began to price their homes accordingly, causing another stall at this level. Terry thinks the buyers are actually there, but they're just waiting for the sellers to become more realistic with their pricing so inventory can start moving again. The irony here is that interest rates are lower today than back at the beginning of the year, and the market and the economy, in general, are doing well.The main reason people are listing their homes right now is that they’re looking for larger or nicer homes—they’re moving up the ladder, as it were. These move-up buyers, says Terry, account for about 40% and then those relocating to other areas comes in at about 24%.The remaining percentage can be attributed to retirement, change in marital status from death or divorce, and then those wanting to move to a better school district, which is always a factor.We live in a mobile society in stark contrast to say 40 or 50 years ago when homes were, if not forever, at least, for most of one’s adult lifetime. Many of us move many times throughout our lives and that’s what makes the real estate world go round and round.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Roundup.  This is the time every single week we get together with noted real estate agent, Terry Story.  Terry is a 27-year veteran with Coldwell Banker located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: The markets ebb, and the markets flow, and there are low priced and medium priced homes, but today I want to talk about what the luxury priced market is doing.  It's not so healthy, is it?Terry Story: You know, I mean everything is local.  You have to look in your own local marketplace.  What we've seen, Steve, since late 2015, there's been severe inventory woes.  You can see this in Manhattan, West Village, or Beverly Hills in Los Angeles, where actually it's more of high levels of inventory.  It's that old story, supply and demand.  The inventory levels are rising, and when inventory rises, prices fall.I can relate that to my own marketplace.  I did a study the other day in an area that I sell a lot of.  Interestingly enough, I noticed that the inventory since February was seven luxury homes for sale, non-waterfront homes, and that to today's date jumped up to 18.  That's over a 100% increase in inventory.  Interestingly enough, during that, however, many months, February through August, there's only been one sale.  You've got to say to yourself, "All right, what's going on here?"Steve Pomeranz: What are the general prices of these homes you're talking about?Terry Story: This study that I did were homes priced from a million to two million.  Our median market price, in this area, is in the 500 range.  This is more than double the median priced homes.  This is your typical move-up buyer, your executive type buyer, relocating buyers,

Why The Euro May Be Destined To Fail

With Mark Blyth, Consultant on International Political Economy, Eastman Professor of Political Economy at the Watson Institute of International and Public Affairs at Brown University, and author of  Austerity: The History of a Dangerous Idea, & Great TransformationsMark Blyth is a consultant on International Political Economy, the Eastman Professor of Political Economy at the Watson Institute of International and Public Affairs at Brown University, and the author of Austerity: The History of a Dangerous Idea, & Great Transformations.Mark has spent years studying and writing about the European economy where recently the focus has been placed on the weakening of the EU and its difficulty finding its way back to prosperity. One of the premises in Mark’s book is that austerity programs do not work when all states do it simultaneously, which is what is happening in Europe now. He explains that when both the government and the private sectors are saving, the only way for the underlying economy to go is down. This he calls the paradox of thrift.  Greece, which can’t seem to come out from under its blanket of economic gloom, is perhaps the best example of a stalled austerity program. The two sectors, private and government, simply can not both be saving at one time.A fundamental difference between the European Union and the US—and the reason we were able to survive the last financial crisis—is that we have our own currency, which allowed the Federal Reserve and Congress to stimulate the economy by propping up the financial sector and, ultimately, giving the economy room to grow.The EU, on the other hand, shares a common currency, over which the individual countries have no control— they can’t print it, devalue it, or inflate it. Austerity programs have been imposed, the UK has voted for Brexit, and how this plays out will have to be seen.There has been much discussion during our presidential campaign season about how high taxes are in the US.  And as for the opposing views of our two candidates, simplistically stated, Trump wants to lower them and Clinton want to raise them.Mark cites statistics from OECD (the Organization for Economic Cooperation and Development) showing that the United States is one of the least taxed societies in the world.  “The problem in the United States,” says Mark, “isn't a taxation problem that's too high.  It's actually too low relative to the amount the government is spending, so you constantly run structural deficits which accumulate debts.”He also says that the majority of households in the highest income tax brackets are actually upper middle class, and not the super wealthy, and if you burden this group with higher taxes, it would yield no financial benefit at all.  As it stands now, the super wealthy pay a lower nominal tax rate because of the way tax law is structured. Mark believes this is unfair and is the reason that people are angry and feeling disenfranchised.That some of this discontent can be attributed to the changes brought about by globalization and technology can’t be denied, a subject covered in depth in Mark’s book, Austerity: The History of a Dangerous Idea, & Great Transformations, along with some interesting positions on the Reagan/Thatcher years.Read The Entire Transcript HereCollapse Transcr...

Donald Trump Might Not Be A Smart Investor

With Steven Goldberg, Investment Advisor, Writer for Kiplinger.comWe may not have his tax returns or a valid report on the state of his health, but we do have some idea as to how Donald Trump invests.Steven Goldberg of Kiplinger.com has gone digging into Trump’s investment strategies and wrote an article about his discoveries called "How Donald Trump Invests Outside of Real Estate."Aside from his real estate holdings, it appears that Donald Trump loves junk bonds. These lower-quality bonds carry with them the substantial risk that the person borrowing the money won't be able to pay it off.  His financial disclosure report, which he was required to file since he’s a Presidential candidate, revealed that he has millions, but not billions, in these stocks and bonds. It’s estimated that, outside of his real estate positions, he has about $114 invested in other asset classes.Trump has boasted that he’s worth $10 billion, although Forbes has said it’s more realistically around $3 billion. Whatever number is closer to the truth doesn’t matter; it’s still a huge sum to have such a comparatively small amount invested in stocks ad bonds. Relatively speaking, it’s just not very much.As for his overall performance in the market, assuming there are no trades in his portfolio, Steven assesses that as mediocre, coming in a little under 6%. Comparing that to the S&P 500, “he would have lagged pretty dramatically.” But adding in his real estate holdings, he may have matched the return of the stock market.Steven acknowledges that at Kiplinger there is a preference for stocks over other types of assets because they’ve produced better results over time than any other investment, but volatility does keep some investors away. That’s a valid fear for most people in retirement who should have no more than 50-60% in stocks, according to Kiplinger.Steven’s investigative efforts into Trump’s holdings also show his fondness for hedge funds, the riskiest kind of junk bonds, with which he has several big positions. These are companies that are near or going through bankruptcy. Having called himself the King of Debt, he’s certainly fishing in familiar waters, which is actually a good thing.Understandably, for a man who deals in the world of brick and mortar, the intangible aspect of the stock market has less appeal and may even suggest a lukewarm level of interest. He has 45 positions that are worth less than $1,000 and another 35 worth between $1000 and $10,000 and holds these among four brokerage accounts.What Steven found most surprising was the unnecessarily high fees in his mutual funds. Also, in total, he has 151 positions in stocks, 101 in mutual funds, and 85 individual bonds, spread so widely that no one could keep track of it all.It seems disorganized, and, quite frankly the portfolio looks like a mess, but not having the inside knowledge of who his brokers are, we can only speculate.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: Hey.  Wonder how real estate mogul, Donald Trump, invests his own money when he's not investing in real estate?  Well, Steven Goldberg from Kiplinger is here, and he did a little digging to come up with some surprising answers.  Hey, Steven.  Welcome to the show.Steven Goldberg: Glad to be here.Steve Pomeranz: When it comes to investing outside of real estate Donald Trump takes big risks, but not with stocks, you say.  What does he actually do?Steven Goldberg: He loves junk bonds.  I was surprised at how so scatter shot his investments were.  They were kind of all over the place, but the thing he emphasizes the most is junk bond...

4 Ways To Be Sure You Don’t Screw Up An Inherited IRA

With Rachel Sheedy, Contributor to the Kiplinger Retirement ReportYour spouse or your rich uncle bequeaths you the money in their IRA. Besides being grateful, what do you do? How do you handle such a windfall? Decisions must be made quickly and it even becomes more complicated if you’re part of a shared inheritance.Rachel Sheedy takes us through the four steps to take if you find yourself in this position as written for Kiplinger’s Retirement Report below:* Retitle the account. Because you can’t roll the money into your own IRA, you must create a properly titled inherited IRA. "It must include the name of the decedent and the beneficiary, clearly identifying who is who," says Denise Appleby, chief executive officer of Appleby Retirement Consulting, in Grayson, Ga. For example, the account could be retitled to "Mary Smith (deceased August 8, 2016) IRA for the benefit of Joe Smith." You should also name successor beneficiaries.If you want to "stretch" the benefits of the tax shelter over your lifetime, you must take annual withdrawals based on your life expectancy, beginning no later than the end of the year after the year the original owner died. Those distributions are taxable from an inherited traditional IRA, but tax-free from an inherited Roth IRA. Otherwise, you must clean out the account within five years of the owner's death if he died before age 70 or, if he died past that age, you must use the deceased owner’s life expectancy to take distributions.* Split an IRA. While an owner can name multiple IRA beneficiaries, it can pay off for those heirs to divide the IRA after the owner's death. If they remain together on the inherited IRA, the life expectancy of the oldest beneficiary must be used to calculate RMDs.Instead, each beneficiary should set up an inherited IRA so that his or her own life expectancy comes into play. This is particularly important if there is a large age difference between heirs. If a 60-year-old son and a 22-year-old granddaughter are named heirs to a traditional IRA, for instance, separating the accounts would set the 22-year-old's first RMD at 1.6% of the account balance, compared with a 4% withdrawal required by the 60-year-old. That means more of her money can stay in the account to grow tax-deferred. (You can always take more than the minimum if you need to.)The IRA must be split by December 31 of the year after the year the owner died. Each heir can then devise a personal investment strategy and, notes Jeffrey Levine, chief retirement strategist for IRA advice firm Ed Slott and Co., name his or her own beneficiaries.* Pay out a nonperson’s share. If you are named an heir along with a charity or other nonperson entity, you'll want to pay off that share no later than September 30 of the year following the owner's death. Otherwise, you'll lose the chance to stretch the IRA over your own lifetime because all assets must be disbursed within five years of the owner’s death if the owner died before age 70. If the owner died after that age, you'd have to take annual withdrawals based on the deceased's remaining life expectancy, as set out in IRS tables.* Turn it down. What if you think the IRA could be better maximized by the next beneficiary in line? "If the heir does not desire the income or the additional asset, he can disinherit his interest in the IRA," says Joe Heider, president of Cirrus Wealth Management, in Cleveland.For example, a daughter may be the primary beneficiary but decides she wants her children, who were named as contingent beneficiaries, to inherit the IRA. They could stretch distributions out longer and perhaps pay tax on the money...

The Real Estate Market Takes Its Bumps

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLThings can get a bit bumpy in the real estate world and, according to Terry Story, this is one of those times. Existing home sales have slowed down, inventory is low in many parts of the country, and prices are generally too high for most buyers.A regional breakdown of the decline in home sales shows the  Northeast  down by 13%, the Midwest by about 5%, the South by about 2%—however, the West rose about 2.5%.Terry’s remedy for this stalled market is for sellers to price more realistically, perhaps by utilizing the new pricing strategy she’s talked about recently; that is, by pricing the home just at or slightly under the desired price, thereby creating a bidding war among buyers which ideally results in a satisfying conclusion.As evidence of the effectiveness of this approach, Terry says she has five offers on one house at the moment, with prospective buyers competing with each other to get a higher and higher price.A page from the Terry Story Real Estate Survival GuideYour house has sold and the inspection process has been completed. What is the best way to handle repairs that need to be done after the inspection?Terry says that in our area homes are generally sold as is. After a report is generated indicating the necessary repairs, a dollar amount is determined, and the seller issues a credit to the buyers who are then responsible from that point forward. This avoids the buyer being dissatisfied with the quality of work done by the seller which, in turn, could cause problems at closing.On a final note, September is Realtor Safety Month, designated as such primarily to alert sellers to be mindful of keeping valuables, personal information, drugs, car keys, and even pets hidden or locked away when realtors and customers come through your homes.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Roundup.  This is the time every single week, we get together with noted real estate agent, Terry Story.  Terry is a 27-year veteran with Coldwell Banker located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: The real estate market's getting a little bit bumpy here.  I understand that existing home sales have slowed down. That's existing homes sales.  What do you think the reason for that is?Terry Story: Steve, we have low levels of inventory in certain parts of the country.  When you have low levels of inventory and the price is rising, you're going to get a slowdown in sales.  What we're looking at is …  And for the month of the July, they really fell off track. We've been climbing and climbing and climbing. Especially for the summer months, summer months are really busy times, especially for the single parent homes.  They're usually really strong.  It comes down to affordable housing.  Low levels of inventory, prices rising, buyers can't seem to afford what's out there.  We do have inventory, it's not like there's no inventory, but it's not inventory that people want. There are always homes that are on the market that are over-priced and those homes are going to sit there because the buyers aren't willing to pay more than what the market will bear.Steve Pomeranz: Right. We’ve talked about this almost endlessly in the last few months. The fact that sellers really need to price realistically in order to get that house sold.  We even talked about new strategies.  Instead of pricing it high and looking to negotiate the price down, is price it just slightly below.Terry Story: Yep.  I got an offer today I'm trying to put in, there's already five offers.Steve Pomeranz: Yeah.

Can Early Retirement Be Bad For Your Health?

We all do our best to live a good life, to earn enough so we can provide for ourselves and our loved ones, and to save enough towards retirement. But what’s the right age to retire?About a century ago, around the year 1900, most babies born did not live past the age of 50, but today life expectancy at birth in the U.S., Japan, and other developed countries is close to 80 years. People are healthier, are living longer, and feel fit enough to actively work into their 60s, 70s, or even their 80s, which begs the question: When’s a good time to retire?There are no clear cut answers to this vexing question. Many workers have a simple attitude toward retirement: the sooner, the better. If you have the financial resources to assume a life of leisure, why not do so? While there are many I know who’d love to retire as soon as they can, I know just as many who love to work and want to keep going at it forever.So here’s one piece of research that says, “Retire Early, Die Early” with the premise that for healthy workers, retiring even a year early raises the risk of earlier mortality. This newly published research (from Oregon State University) from a large-scale study from 1992 to 2010 provides a stark and compelling answer: If you retire early, you will likely hasten your own death,The researchers found that among healthy retirees, “a one-year-older age at retirement was associated with an 11 percent lower risk of all-cause mortality”.Similarly, unhealthy retirees had a lower all-cause mortality risk when retiring later which led them to conclude that early retirement may be a risk factor for mortality and that a prolonged working life may provide survival benefits among U.S. adults.And while the researchers conceded that the reasons for this are generally not well understood, they said one possible explanation could be that employment is a key component of an individual’s identity and provides them with substantial financial, psychosocial, and cognitive resources that prolong life.Furthermore, as I have also discussed before, retirement could be a stressful life event  leading to anxiety and depression among people who suddenly have no structure or purpose in their day-to-day existence. Such stress has long been associated with poorer health.So if you’re thinking about taking early retirement, you should probably think again – which seems sad, doesn’t it? I know many of us look forward to finally kicking the commute and filling our day with activities we cherish way more than work.There’s an encouraging flip side to the retirement age debate. This comes from a study which points to data collected from pension funds at large U.S. companies such as Boeing, Lockheed Martin, AT&T, and others which shows that employees who retire after the age of 65—so-called “late retirees”—do not live long enough to collect their fair share of pension money. This research points to an actuarial study that shows a positive connection between a low age at retirement and a high average age of death, the opposite conclusion of the study I just discussed. But there might be some other factors at work.* First, this latter study says that hard-working late retirees probably put too much stress on their aging body-and-mind, are stressed, and develop various serious health problems.* Then, that earlier retirees probably are either wealthier or more able to plan and manage the various aspects of their life, health and career, so they can afford to retire early and comfortably.* Moreover, this latter study said these early retirees are not really idling after their early retirements, that they still continue doing some work on a part-time basis, at a more leisurely pace, with financial security so they are less susceptible to work pressures and are less stressed out. Furthermore, they have the luxury to pick and choose part-time work that is of real interest to th...

Election Year Myth Busting: What’s True And What’s False

With Michael Brush, Journalist at Marketwatch.comMyths belong in tales from ancient Greece or Rome, not in Presidential campaigns. This year, however, they’re coming at us like love bugs on a Florida highway in September. So how do we break through all the rhetoric to get to the truth?Michael Brush of Marketwatch.com addresses six of these election year myths which center around your financial life and could influence you at the voting booth.Myth #1:  The economy is merely trudging along at stalled speed, the GDP is low, and stocks are vulnerable. Michael explains that while GDP is coming in at 1.1%, GDI is coming in at about 3% which sounds about right if you consider the really strong auto sales, strong employment numbers, strong loan growth, and strong wage growth.Auto sales came in this year at almost 18 million and employment's been robust at about 280,000 jobs a month, about 200,000 a month over the past year.Myth #2: The US has been plagued by stagnant wages for decades.Politicians love to spread fear by unleashing misinformation that impacts the market. An example from a past election year is back in 2012 when both Newt Gingrich and Mitt Romney were talking about the “Obama depression”, triggering a market decline when, in fact, the economy was in recovery and on track.There are different ways of measuring and when speaking about wages in the US, Michael refers to ADP, Automatic Data Processing, a company that handles payroll processing for a large number of US companies. “ADP tracks people in the same jobs, and they're showing wage growth of about 4% to 5%, which is pretty good. As the boomers retire, a lot of really high incomes go out of the equation, and as young people come in, a lot of really low incomes come in.  As a group, that puts downward pressure.” So in essence, we have people who have earned higher wages coming out of the job market and being replaced by younger workers with lower wages.Myth #3: People are angry and worried about the health of the economy, so they support Trump.“Consumer spending was up almost 3% in the first half of the year,” says Michael.  “That's a pretty big number. That doesn't really jive with the concept of people being angry about the economy.”Myth #4: We’re a nation that is drowning in personal debt.That statement is not borne out by the facts. Taking out the millennials who have not been saving, the savings rate for those 45 and up is about 6%, which, according to Michael, is a healthy number.Myth #5: Low oil prices devastated the oil patch, hurting jobs growth overall.Although the oil-producing states of Texas and Oklahoma have been damaged, other states have actually benefited from the boost from cheap energy.Myth #6: Technology helps us get more work done.Surprisingly, the numbers don’t support this idea. Productivity has been flat since around 2005, which could be attributed to the theory that in the 80s and 90s—because of technology—how we do things in the office and in factories changed. Now a lot of the technology developments are in our personal lives which might actually detract from work. There are studies that show social apps (Facebook, Tinder, for example) lower self-esteem, which could theoretically lower motivation and make you work less.Understanding what’s behind some of these myths helps us become better investors and smarter, more well-informed voters.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: In case you haven't heard, we are in an election year and there's enough negative rhetoric flying around to choke a horse.  The only rhetoric we're interested in here on this show is centered around your money and your financial life.

Clinton Vs Trump: Economic Plans Edition

With Douglas Harbrecht, Director of Digital Media at Kiplinger Washington EditorsBoth Donald Trump and Hillary Clinton are promising to grow the economy and increase jobs in our country. Their plans are different but both will affect your personal finances, so it’s vital to understand at least the basic tenets of each candidate’s proposal.  So we're bringing you Clinton vs Trump, the economic plan edition.Doug Harbrecht, Director of Digital Media at Kiplinger Washington Editors, has been covering politics for 30 years and says he’s never before seen economic growth in jobs framed quite this way.From the start, Trump has campaigned for renegotiating or nullifying every trade deal since NAFTA. His is a protectionist approach very is is a protectionist apporachHissimilar to the BREXIT code which is pulling the United Kingdom out of the European Union and a radical departure from the long-standing GOP platform of pro-globalization and pro-trade from the last 100 years.For her part, Clinton follows a more traditional Democratic stance calling for free-trade and “tax and economic incentives to entice multinationals to bring their dollars back to the US.”They have opposing ideas of how to deal with American corporations who merge with foreign corporations and then pay a lower tax rate because they are domiciled in a foreign country. Trump would lower American corporate taxes to 15% to de-incentivize them from doing these inversions.  Clinton, on the other hand, has said she would impose penalties on those companies who take these foreign tax advantages.Concerning the Affordable Care Act, Trump and Clinton are also diametrically opposed. Clinton would expand on it, says Doug, “by seeking to lower out of pocket and prescription drug costs.  To make premiums more affordable, she backs a tax credit of $5000 per family to cover costs exceeding 5% of household income.” For Trump’s part, he’s been widely quoted as saying he would repeal the whole thing and allow private plans to work across state lines.As for Social Security and Medicare which will concern all of us sooner or later, Hillary Clinton has proposed expanding those benefits for women who are widows and caregivers and would let some individuals over the age of 50 or 55 to buy into Medicare instead of at the present age of 62. To pay for all this, she wants to close loopholes for the wealthy and for corporations.Donald Trump has said he would preserve both Social Security and Medicare but has hinted at entitlement cuts to keep both programs solvent.The Tax Policy Institute has analyzed both candidate’s overall economic proposals to predict the future cost and effect on the deficit. By costing out Clinton’s proposals, they say that over ten years these tax increases could raise about 1.1 trillion dollars and, assuming the spending to be around 1 trillion dollars, it could result in a neutral position for the deficit, which is a good thing.Trump has been less specific with many of his proposals and actually changed it from the beginning of his campaign in his speech to the Detroit Economic Club on August 8th, so the calculations haven’t yet been determined. “That said, though,” explained Doug, “the Tax Policy Center did look at his original tax cut plan and estimated that it would cost 9.5 trillion dollars over the next 10 years.” But there is an assumption that he will have to make additional spending cuts so that the red ink won’t increase the public debt.For a more detailed and comprehensive comparison between Clinton and Trump and what each candidate’s platform means to you and your finances, we invite you to attend an in-person talk with Steve Pomeranz on September 22nd at 7pm at the Marriott Hotel in Boca Raton.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: The effect of the candidate&#821...

Time The Stock Market At Your Peril

With Steven Goldberg, Investment Advisor, Writer for Kiplinger.comTiming the stock market can be a loser’s game, but just like in Vegas, many people still gamble against the odds. And with easy access to the endless stream of information out there, anticipating the market’s gyrations has become even more difficult, if not impossible.Steven Goldberg of Kiplinger.com recently wrote an article around this theme called, “Timing the Stock Market at Your Peril.”So how can you tell which way the financial wind will blow in times of stormy weather? A near seismic event occurred with the Brexit announcement which sounded pretty serious for a couple of days when stocks sold off, but then the air cleared and the market quickly recovered all its losses.With all of his 35 years of experience in the business, Steven Goldberg admits that at the end of the day, no one really knows what the market’s going to do. It has a mind and a momentum all its own. Events of great magnitude can occur causing a market to fall, but sometimes it’s as simple as someone deciding to unload shares for whatever reason and buyers being unwilling to step up to the plate.Circumstances can occur which point to a market turn, such as with the famous speech by Alan Greenspan in 1996 about irrational exuberance when stocks kept rising by double digits. His assessment was correct, but the peak didn’t happen until three years later. Someone reacting to this information too early would have been correct in terms of direction but wrong in terms of timing and would have missed out on all those earnings.It’s very hard for investors to live with uncertainty, but with the enormous amount of information available on a 24-hour basis and so many more players in the game, Steven says it’s harder than ever to beat the market. There are ways to position your investments to profit from cheap valuations, however. For example, he cites that back in ’96 “to have sold some of the tech stocks and bought some of the more value-oriented stocks and some of the foreign stocks would have worked.” It’s the emotional aspect of investing that’s the most challenging; staying on the sidelines when tech stocks were going up would have been really hard. “Currently,” he goes on, “I think the real values are in foreign stocks and also in emerging markets and yet they've done terribly.  US stocks have beaten foreign stocks for 3 or 4 or 5 years now.”  Acknowledging that even though emerging markets are beating everything right now, Steven says we don’t yet know whether it’s just a head fake, a false alarm.The last five years have seen a lot of head fakes. In a world full of uncertainties, we’re experiencing one of the longest bull markets in history which could be because the Federal Reserve is keeping the market propped up. Again, we just don’t know.In conclusion, Steven adds that we need to remember “that since 1900 stocks have returned about 10%.  In that period, we had the Great Depression, we had 2 World Wars, and all kinds of disasters that were smaller.”The best advice is to buy good quality investments and to be diversified.  If you're going to buy mutual funds, buy index funds with low cost and low taxes. Successfully timing the markets would be very profitable if you could actually do it, but you really can't.People tend to hold on to their farms, their residences, their commercial real estate, and they tend to make money over time. But in stocks there is a blessing and a curse: The blessing is that stocks are liquid, and the curse is also that stocks are liquid.Read The Entire Transcript HereCollapse Transcript

Can Home Buyers and Sellers Be Friends?

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLA house goes on the market and everyone is on his best behavior, putting his shiniest foot forward. The seller cordially opens up the home to potential buyers who are generally respectful and wanting to make a good impression, and everyone is smiling. But after the sale, that relationship between buyer and seller sometimes takes a radical shift.Terry says you have to look at both sides.  From the buyer’s point of view, after the inspection process has taken place, they’re eager to make plans, maybe come back in and measure windows or flooring. The sellers, however, want to lock the door and get back to their lives. It could be risky and even jeopardize the sale if the buyer does come back in and realize from perhaps their contractor that what they had imagined isn’t possible to accomplish.Nevertheless, Terry advises her clients to go through the inspection process with a contractor and wait until the walkthrough before going back in. It’s a good idea to have your realtor or contractor at the walkthrough as well, especially if the house has been vacant and vulnerable to vandalism.Now with the beginning of the school year, Terry notes a bit of a lull in real estate activity here in the South Florida area. Most home seekers have made their new home decisions, but in this business, Terry says, there’s always another  peak season just around the corner.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Roundup.  This is the time every single week we get together with noted real estate agent Terry Story.  Terry is a 27-year veteran with Coldwell Banker located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: Let me ask you this question.  Can and should buyers be entitled to come visit the house that they're bidding on after the inspection period and before their walkthrough?  Because that contains all kinds of problems.Terry Story: It does, Steve, and it depends on how you're looking at it.  Take the view of the buyer and you can take the view of the seller.  The buyers like to go back to the house multiple times.  After they've done their inspection, they like to place furniture, take new measurements.  From a seller's perspective, they've sold their home, they'd like to go on with their life.  They don't want to have to necessarily keep showing it, keeping it clean and tidy.  There's risk involved when you do this, Steve.  The more, especially if the buyer is planning on renovations, and what we find is the buyer would like to come back and bring this contractor, then that contractor.  This can become a problem and a deal killer, actually.  A buyer may find out, "Oh, I can't really do what I thought I could do by taking down this wall," or what have you.Steve Pomeranz: It's risk to the seller because the buyer may be changing their mind or something?Terry Story: That's correct.Steve Pomeranz: For whatever reason.Terry Story: That's correct.  Now you have some circumstances, lately, in this type of market that we're in, you'll have people buying homes that are from out of state.  They're familiar with the neighborhood.  They visited the neighborhood.  They know what the homes are like, yet they left without being able to buy a home because there is nothing available that they liked when they were in town.  What we find, Steve, is people will go online, look at houses in that particular neighborhood.  They find one that they like.  They'll send their agent over there to preview the home for them, and then they're making offers on the house.  I've had this happen multiple times this...

Watch Out For Those Hidden Financial Fees

Once you make the shift from saving to investing, the first order of business is to minimize fees and expenses, in order to get the most return possible. But with interest rates near all-time lows for several years now—and appearing likely to remain that way for many more years to come—some investors are getting antsy… and looking for ways to juice their returns so they earn more than the paltry returns on bank savings, CDs, and bonds. Some are also not so bullish on continued high stock market returns going forward and are concerned that the S&P 500 has little room to rise after its 85% return over the past five years.The paradox of this “lower expected returns” scenario is that investors are too scared to handle their own money and are willing to turn to professionals, which in itself is a sound strategy.But, many, in their desperation, are looking for “star investment managers” whom they believe could goose their returns through financial wizardry, out-of-the-box gambles, and other forms of “pixie dust”. As a result, individual investors are increasingly handing their money over to high-fee advisers to overcome low expected future returns.And many are buying into what some investment managers are telling them, which is to diversify outside of stocks and bonds and other real assets like gold, into so-called “alternatives” and other vehicles, which somehow through the sprinkling of “pixie dust” can produce market-beating returns.   The reality of these alternatives, which has been shown over and over again, is that most of those assets just don’t bring anything remotely close to what they promise despite the high fees charged to you in order for you to get in the game.But here’s the catch with “star investment managers”: Sure they’re out there—with long-term proven records—people such as Warren Buffett of Berkshire Hathaway and Howard Marks of Oaktree Capital. But finding a sure-fire market-beating money manager is anything but a sure thing. Moreover, as we all know, past investment performance is no guarantee of future returns, so going with a “star” does not automatically guarantee high returns.There’s another catch with “star investment managers”:  They typically demand higher fees to support their search and research for higher-yielding assets because they often need to dig deep and communicate with specialized experts to uncover hidden, undiscovered, undervalued investment gems.And while these high-fee advisers or portfolio managers might actually manage assets better, what they put in one pocket with better behavior and performance, they take from the other pocket with high fees. And if they under-perform the market—which statistically is the more likely outcome—you get to experience a double whammy: Your bad returns get further sliced by the high fees you’ve paid, hurting your portfolio more than simple returns from a low-cost index fund.We also see this in recent data on investment performance. As more active managers fail to perform well, advisory fees are on the rise. So, in their search for higher returns, investors are running scared into the arms of high-fee advisers who gladly slip their hands into your back pocket as they embrace you.Historical number-crunching of managed portfolios has also proven that high fees can be the most destructive part of any financial plan.And while no one knows what the future returns of the stock market will be, many think that stocks tend to generate lower future returns when they’re richly valued. So, with the S&P 500 index up 85%, lower returns could be much more likely. Add higher fees to that and they will eat up a bigger portion of this lower return.Just to clarify, in a world where some of the best funds and advisers cost less than 0.5% a year of managed assets—and much less for index funds—anything above that 0.5% threshold falls into the “high fee” category, in my opinion.

How A Trump Presidency Could Affect Your Finances

With Heather Long, CNN’s Senior Markets and Economy WriterLast week we spoke with Heather Long, CNN’s Senior Markets and Economy Writer, to discuss Hillary Clinton’s economic policy (click here for the interview). This week we again asked Heather to bring her insight to examine Trump’s ideas and how you would be financially impacted under his economic platform.As a brief recap of last week’s segment, we compared Trump’s economic message of “America first” and Hillary’s as “families first”. While Donald Trump wants to start on day one by tackling our trade policy, Hillary’s primary goal in the first 100 days is to bump up infrastructure spending.To further expand on the comparison of their individual tax platforms, Hillary said she would raise taxes on those earning over $250,00, while Trump said he would cut taxes across the board, both for individuals and for corporations. He’s also on record wanting to do away with estate tax and lowering capital gains tax, which would be a boon to US businesses but also would, in effect, mean a lot less revenue for the government. Whether or not this would stimulate the economy, as Trump says it would, is a matter of some debate.Trump has also been widely quoted as saying that the US is the big loser in trade deals, particularly with Mexico and China which he wants to reverse by taxing goods coming in from those countries. Of course, this will have an effect at the consumer level with higher prices at the store and, in addition, will most likely result in those same countries imposing their own taxes on goods and services from the US.  (Some economists fear the result could be a trade war, such as preceded the Great Depression.) Clinton also has spoken about imposing tariffs on trade, although to a somewhat lesser degree.Would these tariffs bring jobs back to the US, as Trump declares? Many economists think this to be a bit of magical thinking. It may indeed take manufacturing away from China and Mexico only to be moved to other parts of Asia or Africa, instead.Regarding issues most relevant to women, Trump has proposed a bigger tax credit to offset the cost of childcare and eldercare. A problem with this, says Heather, is that many lower-income families don’t incur enough income tax to be helped by this credit; however, Trump has also come out saying the credit could be used against payroll tax, which has to do with Social Security. Donald Trump has also stated that he wouldn’t touch Social Security or Medicare, but he has winked at some entitlement cuts.If this all sounds a bit murky, bear in mind that we’re riding along on the presidential election trail and candidates will continue to make promises and to modify those promises, right up to the moment when he or she places his or her hand on the Bible to assume the Presidency of the United States. Then we the people will witness what happens with every presidential election platform, no matter how well-intentioned or well-planned, as it either partially survives or is swallowed up by the forces of reality in Congress and the world stage. Then we likely will get something like that box of chocolates in Forrest Gump’s lap.On September 22 at The Boca Raton Renaissance Hotel, Steve Pomeranz invites all interested parties to an open discussion of what the outcome of this presidential election means to your money, your portfolio, and your financial future.  Click here to sign up.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: On September 22, I will be inviting you all to join me in person as I discuss what this presidential election means to your money and your finances, and I'll talk more about that in detail a...

US Manufacturing Is At A Peak…So Where Are The Jobs?

With Ylan Mui, The Washington Post financial writer covering the federal reserve and the economy,  “What Republicans and Democrats Get Wrong About American Manufacturing”Ask the man on the street about manufacturing in America and chances are he’ll say the US doesn’t make anything anymore, and all our jobs have gone to China and other countries overseas.Ylan Mui, who wrote a recent article for The Washington Post entitled, “What Republicans and Democrats Get Wrong About American Manufacturing,” tells us the facts don’t support this perception.The surprising reality is that we manufacture two and a half times as many products now as we did back in 1970 and “our industrial production—what economists call the output for the manufacturing industry—is near peak level, and it's increased dramatically over the past forty years”The misperception instilled in the mind of the man in the street, however, is largely the result of the types of manufacturing jobs lost to overseas concerns and to the very real drop in the number of workers employed in US manufacturing today. Heather points out that while China has taken over in the production of steel, toys, many electronics, and apparel, for instance, we in the US are making a different category of products—pharmaceuticals, heavy machinery, cars and trucks, being among the most notable. The cause of the decline in jobs from nineteen million in 1979 to twelve million today is technology and automation; it simply takes fewer people to produce an item and that leaves about a third of the previous workforce unemployed.Although, says Ylan, “there have been multiple proposals throughout the years and certainly very good efforts to retrain workers for new industries… finding another place for these workers is a lot more difficult than we thought.”  Often, when a company that had employed large numbers closes, it takes the town with it, leaving behind an area in serious decline. So even with training and new skills, some of these workers will have to relocate in order to find new jobs. Often they’re either unwilling or unable to do that for a variety of reasons, one of which could be a housing market that went into decline along with everything else. One bright spot, says Ylan, is that real estate has improved making it easier for many people to sell their home and make that relocation to an area of greater opportunities.In spite of what the candidates may be promising about bringing jobs back to America, “it’s very hard to stop the march of technology” and as for bringing most of these lost manufacturing jobs back home, it’s about as likely as getting Colgate back into the tube.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: The candidates may be right about one thing.  It's a fact that many people have lost their jobs that they've had for many years, and for many, there isn't an obvious alternative for them.  However, the explanations both candidates give for this issue are more suited to getting votes than they are to adhering to the real facts.  It's the real facts that we really want to get to on this show.  To get to the point, I've invited Ylan Mui.  She joins me from The Washington Post where she's a financial writer covering the federal reserve and the economy and she penned a recent article titled “What Republicans and ...

How To Fix Up A House: HGTV Vs Reality

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLHGTV, one of the most popular TV channels, is all about today’s trend toward remodeling and renovating instead of buying a new home, which all looks very fun and easy on the screen. Someone comes in, takes the measure of things, does a little here, a little there, and you’re left smiling in the middle of your brand new living space at the end of the segment.  This is fantasy TV, says Terry, who offers some valuable advice if you’re considering such a project on your own.* Beware of knocking down walls since they may be there for support or to house electrical or plumbing.* Permits must be pulled when doing many of these changes.* Consider the character of a home before you make a design decision. You could be devaluing a historic home with contemporary updates.* Be mindful of installing high-priced materials that may not pay off if you sell your home down the road.Always consult with a professional before making decisions that could cost you.We recently talked to Terry about the best pricing strategy when putting your home on the market. How to do this to your best advantage—especially considering that more and more people are checking listings online before they hit the streets—is to straddle both sides of the fence. As an example, if the appropriate value of your home is in the 190s or the 210s, placing it at $200,000 would catch both the lower and higher brackets and give you the most exposure.Check back with us every week for Terry’s take on the current and ever-changing real estate climate.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Roundup.  This is the time every single week we get together with noted real estate agent Terry Story.  Terry is a 27-year veteran with Coldwell Banker located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: There's a huge trend today towards renovating and remodeling your home and staying put as opposed to moving to a new home.  What are some of the do's and don't's to consider?Terry Story: Wow.  Home renovation, you have all these great television shows that make it look fun and easy, and it can be done quickly….Steve Pomeranz: In a half hour, right?Terry Story: Yeah.  By the end of the show, your house is completely redone, and life is great.  There were no headaches along the way.  There is a big trend towards renovating homes.  Here are some things that often turn out badly.  Tearing down walls, while some walls—they look like they're easy to tear down—you might want to bring them halfway or actually rip them out.  You need to know what you're getting into because many of the homeowners don't realize that they're load-bearing walls.  They're holding up the floors, the framework of the house, and may be full of electrical and plumbing.  Before you decide to start knocking down walls, make sure you consult professionals to see what's the implication of taking that down.  Then, of course, there's also municipality codes.  When you start getting into changing out electrical and plumbing and moving that around, you really need to pull permits.Steve Pomeranz: Yeah, don't knock out a wall if it's a load-bearing wall, guys, okay?Terry Story: Definitely don't. It won't be so pretty.Steve Pomeranz: It's not going to work out really well for you if you do that.Terry Story: No. A thing to rethink is modernizing a historic house.  Removing some of the historic appeal and character of a home, such as like removing original woodwork, or built-ins, or those claw-foot bathtubs,

Watch Out For The Taxes On Those Medals, Michael Phelps!

If you work for a living, you know that your wages are taxable. You probably also know that most forms of investment income are taxable. But the IRS doesn't stop there. If you’ve picked up some extra cash through luck, athletic skill, or even criminal activities, there’s a good chance you owe taxes on that money as well. So here are nine things that you may not know are taxable:(I realize that many items on this “list of taxable” will not apply to most of you, but it’s still a fascinating list nonetheless.)Buried TreasureIn February 2013, a couple was walking their dog on their own rural property in northern California when they discovered six cans filled with 19th-century gold coins. Imagine that, what luck!  They literally stumbled onto a mini-goldmine! Turns out, the coins were valued at up to $10 million and put up for sale privately and on Amazon.com. (Check it out if you’re interested in buying a few old gold coins.)The couple has wisely chosen to stay anonymous, but they won’t be able to hide their good fortune from the IRS, which says that “Found Property” that was lost or abandoned is taxable at its fair market value in the first year that it’s your undisputed possession. That means the couple will have to pay federal taxes of 39.6% on their windfall, plus California state tax of up to 13.3%.In case you’re interested, the precedent for the IRS’s “treasure trove” rule dates back to 1964, when a couple discovered $4,467 in a used piano they had purchased for $15. The IRS, of course, immediately jumped on this and said the couple owed income taxes on the money and a U.S. District Court agreed.Educational, Research, and Other Forms of Scholarships.This is one that more of you are likely to encounter, and here’s how it works. If you receive a scholarship to cover tuition, fees, and books— you know, core educational expenses—you don’t have to pay taxes on the money. But if your scholarship also covers room and board, travel, and other expenses, that portion of the award is taxable.Likewise, students who receive financial aid in exchange for work, such as serving as a teaching or research assistant, must pay tax on that money, even if they use the proceeds to pay for direct expenses, such as tuition and books.Stolen PropertyThis is one I am hoping none of my listeners have to worry about. If someone—clearly not you, my listener—robs a bank, embezzles money, or stages an art heist, the IRS expects them to pay taxes on the proceeds. As the IRS puts it, “Income from illegal activities, such as money from dealing illegal drugs, must be included in your income on Form 1040. Bribes are also taxable”.Now, in reality, I don’t see any criminals reporting his or her ill-gotten gains on their tax returns. But, if caught, the feds can add tax evasion to the list of charges against you. That’s what happened to notorious gangster Al Capone, who served 11 years for tax evasion because he never filed a tax return on his ill-gotten gains.Gambling WinningsHere’s one that could apply to some of you. Despite the tagline,  “What happens in Vegas, stays in Vegas”, it doesn't necessarily stay in Vegas. Gambling income includes winnings from lotteries, horse races, and casinos. The payer—the casino or the lottery operator, say—is required to give you a Form W2-G (which they also report to the IRS) if you win $1,200 or more from bingo or slot machines, $1,500 or more from keno, over $5,000 from a poker tournament, or $600 or more at a horse track. But even if you don't receive a W2-G, the IRS expects you to report gambling proceeds on line 21 (other income) of your 1040.The good news, on the flip side—and something that could apply to more of us—is if you itemize deductions when filing your tax returns, gambling losses are deductible, but only to the extent of the winnings you report as income. For example, if you won $4,

How A Clinton Presidency Could Affect Your Finances

With Heather Long, CNN’s Senior Markets and Economy WriterIt’s a lot more fun to focus on the controversies surrounding both Donald Trump and Hillary Clinton than to look into what they actually stand for. But before anyone goes into a voting booth on November 8th, it’s imperative to look past the media noise to find the substance and to understand the core issues that anchor each candidate’s platform.Heather Long, who holds a master’s in financial economics from Oxford University and is currently CNN’s Senior Markets and Economy Writer discusses Hillary Clinton’s economic policy and how the average citizen would be impacted were she to be elected.In contrast to Trump’s economic message of “America first”, and Hillary’s has been tagged “families first”, a platform that Heather examines in depth. While Trump wants to start on day one by tackling our trade policy, Hillary’s primary goal in the first 100 days is to bump up infrastructure spending.At the heart of Hillary’s plan for the first 100 days is bumping up infrastructure spending, something that both sides of the aisle concede is badly needed. Across the nation, many of our roads and bridges require repair and maintenance work, and many economists feel that the jobs created by these projects could boost the overall economy and growth rate.Aside from infrastructure, Hillary has proposed four key programs that support her family first position:* Paid family leave without fear of losing employment for new parents.* Free pre-school for every 4-year-old in America.* An option for debt-free college at a state university or community college if certain requirements and contributions are met.* Expanding some social security benefits, for instance, in the case where an elderly woman would retain full payment when her spouse dies.How will all these projects be paid for? Hillary’s tax plan is to raise the tax rate on people who make a million or more, ensuring that this group pays a minimum rate of 30% and, for those who earn over 5 million, she wants to place a surcharge of 4%. In addition, the threshold for estate tax would be reduced to 3.5 million (from 4.47) and the taxable rate on that excess would go from 40% to 45%.Many independent organizations (Tax Policy Foundation and Tax Policy Center) have stated that her plan, in its present form, is basically revenue plus. Heather cautions, however, that Hillary may be “a lot closer to revenue neutral, but whether or not she has a surplus certainly remains to be seen.”Some changes to the tax code are also on her agenda, rendering it even more complicated than it presently is. Trump, on the other hand, wants to simplify the tax code, reducing it to three brackets.Heather feels that no matter who is in office, of all of these plans, both infrastructure spending and corporate tax reform have the best chance of getting through a Republican House.A candidate’s campaign program is never set in stone, nor can it be since we are a nation built upon a two-party system and have a government with built-in checks and balances. That being said and acknowledged, the obligation of every citizen is to have a comprehensive understanding of each candidate’s platform.Next week, Onthemoneyradio.org will present the economic plan of Donald Trump and the Republican Party.________________________On September 22 at The Boca Raton Renaissance Hotel, Steve Pomeranz invites all interested parties to an open discussion of what the outcome of this presidential election means to your money, your portfolio, and your financial future.  Click here to sign up.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz : On September 22,

The Next Big Bang In Real Estate Investing

With Michael Torres, Chief Executive Officer and Portfolio Manager of Adelante Capital ManagementA great change is on the horizon for investors and possibly an even bigger change for the real estate industry. Some refer to this coming event as the “Big Bang”.Michael Torres, Chief Executive Officer and Portfolio Manager of Adelante Capital Management, says that before explaining this impending event, it’s important to analyze some of the basics.First, he explains, there are only two types of investing: either you own something or you lend money.Real Estate Investment Trusts—commonly known as REITS— represent ownership of real assets. With that ownership come all the possibilities of reward and risk. In one sense, you can say that it is a direct ownership in the many different types of real estate investments. By putting together a number of REITS from different areas of the real estate market, one can reduce risk through diversification and hopefully benefit from the positive economics occurring in different parts of the real estate industry.One downside when investing in individual properties on your own is lack of liquidity. If you buy a duplex, condo, or any property as an investment, it’s not easy to sell quickly or to liquidate, if necessary. Publicly traded REITS, on the other hand, are very liquid and can be sold at a moment’s notice.Now to the BIG Bang. Prior to this month, August 2016, investing in a diversified portfolio of real estate through index funds had not been possible. That’s about the change. Real estate investments will now be separated from all other financial index funds and put into their own unique fund, which will open the door to investing specifically in a broad range of real estate investments at a very low cost and high liquidity.This may have the effect of attracting more capital to the industry, making it easier for pension plans and large investors to benefit from the sector. Generally speaking, more capital is good for everyone.Finally, Michael puts forth the new concept that, in fact, owning real estate is a way of investing in the housing of the economy, so that over time, as the economy does well, the companies  that house the economy should also do well.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: You know coming very soon there's going to be what I refer to as a big bang in the real estate market.  Now this is not a scary kind of big bang, it doesn't mean that the world is falling apart and that real estate is going to the dogs.  In fact, I think it's going to be quite the opposite.  To talk about it, I've invited a man with 30 years of expertise, he's Chief Executive Officer and Portfolio Manager for Adelante Capital Management, and he's the person who was instrumental in creating one of the major indexes for real estate, the Wilshire Real Estate Securities Index.  With me is Michael Torres, welcome to the show, Michael.Michael Torres:    Great Steve, great to be with you.Steve Pomeranz: The real estate market is made up of many different kinds of investments.  Let's list some of them to begin with.  Many people have heard of REITs, or real estate investment trusts.  What are they?Michael Torres:    Real estate investment trusts are no different than any other corporate organization.  However, they must make a tax election, so it's an enterprise, whether it be public or private, that makes an election which allows them to forego paying corporate taxes provided they finance or own commercial real estate.Steve Pomeranz: Those taxes are paid by the individual who buys the real estate investment trust?Michael Torres:    That is absolutely correct.Steve Pomeranz: That's different from real estate operating companies in what way?

Navigating The Sticky Process Of Buying And Selling A Home

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLCaught in the middle of selling your old home and buying a new home?  A common situation for many of us who aren’t in the position to pay two mortgages. With 27 years of experience under her real estate belt, Terry has a formula to meet this challenge:* Before putting your home on the market, carefully research where you want to live and have a general idea of prices in that area.* If you get an offer on your home before you find your new home, state that the sale is contingent upon finding that home within a certain time frame.* Establish an extended closing period of up to 90 days instead of the usual 45.* Be prepared to go into temporary housing, whether with a family member or into an apartment or short-term rental, if necessary.In Terry’s experience, rarely does it come to this last situation since, she says, something always seems to work out, perhaps because once you have a buyer, the motivation to find a new home ramps up.We spoke with Terry recently about pricing your home so that you receive multiple offers from which to choose. If you happen to be one of those potential buyers who placed an offer in this scenario and you really want to win at this, what can you do?  Terry advises employing a bit of psychological warfare—in a friendly way, of course—by:* Obtaining pre-approval before submitting your offer. Turn in your tax returns, bank statements, all necessary financial requirements.* Setting up a shorter inspection period in the contract.* Putting down as large a down payment as possible.* Making your offer not contingent upon appraisal, if you really want the property.Timing isn’t always everything when buying or selling real estate. As Terry will tell you, a little creativity and flexibility need to go into the mix as well, whether you’re a buyer or a seller.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Roundup.  This is the time every single week we get together with noted real estate agent Terry Story. Terry is a 27-year veteran with Coldwell Banker, located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: Hey, Terry, if I'm in a position where I want to buy a new home, but I haven't sold my current home, how do I handle this difficult positioning of buying a new home at the same time I'm trying to sell.Terry Story: Sure.  Let me tell you, this is a challenge.  It can be done.  There's a couple of different ways you can do it.  What I tell my customers is, first, when you decide to make that decision and you know that you have to sell your house first and you're not quite sure where you want to go, begin shopping the general area.  Decide you want this part of town, you want that part of town.  Maybe what particular neighborhoods you want.  Have an idea in mind as to where you want to go.  If you feel that you can find something in that area, then go ahead and put the home on the market.  While you put your home on the market, keep an eye on these particular areas that you're looking at.  What happens is you get the offer on the house and now you have to panic because you're like, "Oh, my gosh.  I'm going to sell my house and I have no place to go."Steve Pomeranz: Right, exactly.Terry Story: That's what everyone does.  First, try to get the buyer to give you so many days contingent upon you being able to find a house.  That would be plan A.  Plan B, maybe give yourself an extended closing.  Say, maybe instead of 45 days, make it 60 or 90 days, if the buyer buying your home is willing to do so. Plan C is the most important.

Turns Out Silicon Valley Is A Bunch Of (Chaos) Monkeys

With Antonio Garcia Martinez, Former Product Manager at Facebook and author of Chaos Monkeys: Obscene Fortune and Random Failure in Silicon ValleyNot all monkeys run amok in the wild or in cages at the San Diego Zoo. Some monkeys—the chaos monkeys that Antonio Garcia Martinez refers to in his book—are doing their disruptive dance in Silicon Valley. These monkeys are actually software programs designed to be let loose on computer systems to test their efficiency and resilience.Author Antonio Garcia Martinez barely survived the Goldman Sachs bubble-burst before heading west to join the in-crowd of the tech industry. That crowd turned out to be a culture of rampant self-expression, with uber-confident whiz-kids throwing ideas at the digital wall desperately hoping for one to stick, and shooting the competition in the heart at every opportunity. While the mainstream news agencies headline Silicon Valley innovations and successes, the duplicity, back-stabbing, and often vengeful machinations are seldom revealed as in Chaos Monkeys: Obscene Fortune and Random Failure in Silicon Valley.Silicone Valley operates by its own rules and its own requirements. A Harvard business degree is valued less than a stint with Y Combinator, a sort of training program for technology innovators whose “graduates” Garcia Martinez describes as “bomb-throwing anarchist subversive[s] mixed with coldblooded execution mixed with irreverent whimsy, a sort of technology-enabled 12-year-old boy.” More specifically, Y Combinator is a company that produces other companies, such as Airbnb and Dropbox, by setting up a boot camp of sorts where a product can be pitched in front of Silicon Valley venture capitalists. If successful, money is raised and a business is born.The disruption created by unleashing the chaos monkey theory sounds the death-knell for some and opens the way for a successful culture-changer for others, such as occurred with the standard taxi business when Uber was created. Silicon Valley YC grads are set loose to “basically rampage through society, knocking over or shutting down one or another industry by disruptive technology.”  The monkeys at play.The author began his own startup called AdGrok which he sold to Twitter before heading on over to the golden realm of Mark Zuckerburg’s Facebook, back before the IPO when it was still in startup mode. He calls Zuckerberg a genius, a driven motivator, and a force of nature who fires up all the cylinders of Facebook. Garcia Martinez describes the Facebook atmosphere as a “corporate culture in which a 23-year-old engineer feels empowered to look at Facebook and push some change and have it succeed or fail or whatever, but be in this constant maelstrom of really creative dynamism and constantly pitching new products, many of them frankly ill-thought-out or poorly executed. The point is to actually find that winner that opens the new chapter in social media.  Creating that culture and maintaining it over years, I think, is where the genius aspect comes in for Zuckerberg.”As Garcia Martinez so amusingly tells it, a never-flagging adrenalin-surge was essential to holding your place in such a competitive arena where you had to constantly prove your worth to stay in the game. Although he points fingers and tells tales,

Here’s Why A Financial Planner Can Be Your Life Line

With Eric Hutchinson, CFP, Managing Director of Hutchinson Financial, Author of The Financial Briefing: Answers to Life's Most Important Money QuestionsFrom the first coin or dollar you get in exchange for a lost baby tooth, money plays a big role in your life. You will need it, enjoy it, worry about it, work for it, and, if you play the game correctly, never run out of it. Eric Hutchinson, Managing Director of Hutchinson Financial, knows the rules of the game and has written a book, The Financial Briefing: Answers to Life's Most Important Money Questions, that can guide you all the way to the finish line.It’s important to begin your relationship with money early in life, by developing and understanding how to acquire, save, and invest your money. The first step is formulating a plan designed around your own specific needs and priorities, writing down your goals, and then putting everything in place to begin achieving those goals. It’s a different template for everyone: are you looking forward to an early retirement so you can sail around Cape of Good Hope in your 50s, do you want to provide your children and grandchildren with a legacy, or do you want to have a second home at the beach? And how about priorities? Do you long for a Patek Philippe or are you happy as a clam wearing a Timex?After you define your goals, Eric advises working with a Certified Financial Planner, a trained money professional, who can act as a coach to put you on your individual track and, most importantly, can keep you on that track, especially when life’s inevitable curveballs come your way.Choosing a trusted CFP can be the most crucial step in the process, and Eric’s book includes the resources available to help you make the right choice. Once that’s done, your CFP can help you with the smart choices for your financial future. Do you need to set up a trust, is life insurance a necessity, do you have adequate retirement savings? As far as investments, do you need a strategy that produces income or one that increases in value over the long term? A CFP can wade through the varied and complex available options to create your personalized and balanced portfolio.The Financial Briefing: Answers to Life's Most Important Money Questions is a thoughtfully written guidebook for anyone wanting to live a life of financial security and independence. And who doesn’t?Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: My guest is Eric Hutchinson.  He's a managing director or Hutchinson Financial now a division of United Capital.  He's a CFP with over 30 years of experience in financial planning and investments, etc.  I've asked him to join me today because he's written a book.  The book is

The Road To Financial Security Through Entrepreneurship

With Douglas McCormick, Author of Family Inc.: Using Business Principles to Maximize Your Family's Wealth, Managing Partner and Co-Founder of HCI Equity PartnersAfter years of experience in the investment world and corporate boardrooms, Douglas McCormick, Managing Partner and Co-Founder of HCI Equity Partners, developed a formula for family financial security which he explains in his new book, Family Inc.: Using Business Principles to Maximize Your Family's Wealth.Our previous interview with Douglas McCormick focused on the concept of operating a family within the framework of a corporation to ensure stability and wealth. For today’s segment, Douglas addresses the value of having your own business because, as he writes, "Today only 15% of the population earns more than $100,000, so probability suggests that the path to wealth is not through traditional employment alone." A compelling statement, supported by the fact that wages in our very competitive labor market are not that high and neither are overall returns on investments, meaning you have to save heavily in order to achieve financial independence as a paid employee.Douglas’s theory of why entrepreneurship can better generate significant wealth is based on four fundamental points:* Entrepreneurs are able to work longer in life. Instead of forced retirement, entrepreneurs can scale down their involvement, working on a part-time basis, while the business still operates and produces income.* Returns on capital in a private business can exceed 50% per year.* The tax code for entrepreneurship is more efficient.* A good business can be sold for a profit.On the cautionary side, owning your own business is not without risk and, for most people, Douglas says, it’s a game of “incrementalism”, requiring certain skill sets and certain amounts of capital. Although entrepreneurship can create a lot of wealth, it’s also not easy to get your money out of the business at any given time, and you also have to have the stomach to ride the waves of volatility that can occur in your monthly earnings.“To be an entrepreneur and be successful,” Douglas says, “I think you've got to have a little bit of a war chest where you can afford to go without a paycheck for a period of time.”  Owning your own business, as opposed to taking the paid employee route, managed properly can not only lead to financial independence and security but can also provide a sense of fulfillment and life purpose that comes from creating and building your own life story.Sound interesting? Go deeper by reading  Family Inc.: Using Business Principles to Maximize Your Family's Wealth.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: Just recently I interviewed my next guest.  He's a private equity investor and entrepreneur.  His name is Douglas McCormick and it was about his new book

The Secret Sadness Of Retired Men

With the unfortunate passing of Robin Williams and all that has been written about his struggle with depression, I began to think about my own practice and the men I speak with who seem to experience their own journey of sadness and depression as they enter into retirement.I decided to highlight elderly male depression in my commentary, partly as a small tribute to Robin Williams, Philip Seymour Hoffman, and others who cut their lives short.In particular, I’m focusing on men today because, being a man and being an observer over many years of financial advising, it doesn’t take a psychologist or an expert in any of the social sciences to know that we men go through our own set of mental challenges unique to our gender and which are fundamentally different from women.For example, men who are already retired or getting ready to retire can go from working lives and good health to retirement and possibly poor health. They can experience sadness and depression that typically will go untreated and unaddressed. This is so because, in large part, we men are less communicative about our problems than women. Let’s face it, guys, we just don’t wanna talk about it! Right?Maybe we see dependency and life off-the-treadmill as a weakness or something to be ashamed of.   Many of us have a hard time coping with this major life change.According to psychotherapist Terrence Real, there is a growing body of research which shows that retirement significantly increases the risk of clinical depression and even suicide among men. Surveys show there are about 11 million depressed men in America at any given time—that’s about 9% of the adult male population. The real number is probably higher because men just don’t talk about these sorts of issues and don’t voluntarily tell those who care about them that they are sad, depressed, or need help. Often we’re simply unaware that we are clinically depressed and attribute our sadness to old age, lethargy, illness, or some other factor.as we approach retirement, our traditional “masculine role” fades and make us feel a sense of loss which gets deeper if we can’t successfully transfer our “sense of identity and self-worth” to new interests.Many of us typically attach our “sense of identity and self-worth” to the professional work we do, the money we bring home, and the support we give to our families. But as we approach retirement, our traditional masculine role fades and makes us feel a sense of loss which gets deeper if we can’t successfully transfer our “sense of identity and self-worth” to new interests. This sense of loss is the leading cause of depression in older retired males.And that’s not all, folks. Other losses such as the death of a spouse or close friend, loss of workplace friendships, and the sense of professional belonging can add to these feelings. Also, we can see the prospect of mental or physical decline as something to worry about, especially, because, typically, we often lack support networks that can help rehabilitate our sense of self-worth.The good news is that studies show a 90% success rate for people who seek help. So it is important not to go into this alone and shut yourself off. You need to gently open up about your sadness and find the right resources which are plentiful and there is medication which can help considerably if prescribed by an experienced professional.There is a lot of help out there.So what are some of the signs you should look for? First, know that this sadness is fairly common, not something to be ashamed of.Some of the classic signs of depression are feeling blue, losing one’s sense of pleasure and joy in life, changes in sleeping or eating habits and fatigue, increased drinking, a marked increase in irritability and aggression, and a significant withdrawal from other people and life.Spotting depression is not easy because a number of other things can mimic depres...

Increase Your Credit Score Before Going For A Mortgage

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLTerry’s topics this week include the all-important credit score that banks consider before granting a mortgage. Instead of the old automated process, a new kind of software allows for “trended credit data” which pulls payments you’ve made from the past two years to see, not only if you’ve paid on time, but how much of your balances you actually pay. Mortgage lenders are looking at patterns that give them a predictive feature to determine whether or not you’re a good risk.Changing topics, Terry comments on the fact that, overall in our country, lot sizes are continuing to shrink, mostly due to high population density, since many people choose to live close to work and schools.  Even retirees often opt for living in cities and more crowded residential sections which allow them the ease of walking to most places. If you long for wide open spaces, large expansive properties do still exist at reasonable prices, but those tend to be in more remote areas.Terry’s Real Estate Survival Guide topic concerns a question that was submitted from Gary Singer of the Sun Sentinel. The reader asked a question regarding the responsibility of a homeowner to pay a portion of a fee levied against the homeowner’s association for a code violation. Regardless of the circumstance and its relevance to any particular homeowner, all members are held equally responsible and must share in any such expenses. It’s all for the good of the community in which you chose to live, says Terry.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Round-up.  This is the time every single week we get together with noted real estate agent Terry Story.  Terry is a 27-year veteran with Coldwell Banker located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: You know, I understand that the banks are changing the rules a little bit on how they measure your credit in order to give you a mortgage.  Tell us about that.Terry Story: That's right, Steve.  Up until now, they evaluate a buyer’s potential standard credit by looking at an automated process.  They take into account how much you owe, who it's owed to, and if you make your payments on time.  Now, this revised software's going to rely on what they're calling a trended credit data, which is going to be pulling payment records from the last 24 months to determine not only if you pay on time, but how much you pay towards your credit card balances.  In other words, they're looking to see that you're making more than that minimum.What's also being said, really, they're looking for habits.  It's not really necessarily saying that you should pay 20% more or anything like that, but seeing that your willingness to pay more than that minimum and they're looking for the habits.Steve Pomeranz: The idea basically is that as the gathering of data grows and they're able to apply more statistical analysis to it, they find different aspects of our financial life that can predict, or have predictive natures, or predictive features.  They're saying, "Hey, we realize that if we can see who is paying off their loans at a faster rate and doing it consistently over time, we can assign maybe a higher credit rating to them, and we feel more comfortable about giving them a mortgage." This is a new wrinkle.  We haven't seen this before.Terry Story: That's right.  I think this is a good thing.  I don't think it's necessarily going to penalize those that only make the minimum payments because, for some, that's all they can do, but certainly you get the extra credit if you go the extra mile.

Do You Have The Millionaire Mindset?

The Millionaire MindsetIn addition to giving you my take on the markets and how to invest your money, I like to keep reminding my readers on “habits” you can easily embrace that will systematically bring you closer to building and retaining wealth.Somehow wealth has started to become a dirty word in America, so, if you’re so inclined, just substitute the word wealth with security and independence.With so many theories in the world today, I’m sure that some think the rich are born with some sort of a “millionaire gene”, something inherent in their DNA that makes them better adapted for wealth creation.  I don’t think such a gene exists. And even if it did exist, I think your chances of getting wealthy would be significantly higher if you focused on a few tried and true steps toward building wealth, rather than wishing you’d won some sort of genetic lottery.The investing world is full of common folk, like you and me, who have gotten rich through simple behavioral changes they’ve deeply embedded into their mindset and lifestyle—simple, regular people who don’t earn phenomenal sums of money but still have millions in overall net worthToday, I plan to outline a few traits that are commonly seen in millionaires that we can all learn from. By the way, these traits have been nicely outlined in an article titled “Are You Millionaire Material?” by Serena Kappes at DailyWorth.com.People focused on wealth building see opportunities instead of obstacles. They don’t let excuses stymie them and are adept at getting past obstacles. For example, if they have shortcomings, they will look for simple ways to overcome them by leveraging outside skill sets, like selling their ideas to those with better sets of skills, getting outside investors, or bootstrapping their resources to get the job done themselves.  People with the millionaire mindset believe strongly in themselves and have the strength to overcome odds and win.The millionaire mindset focuses on investments – on using money to make money. And, as we all know, while saving heavily may get you money in the bank, it may not—by itself—make you a millionaire unless you start really early and live a long life.  Those with a millionaire mindset focus on investments, on using money to make money, knowing that money in the bank earns close to nothing and loses buying power over time to inflation. It’s not something they want, so they learn to leverage the power of investing and compounding.Millionaire minds also constantly spend time and money on increasing their knowledge, skills, and capabilities. They invest time in learning new things so they’re professionally ahead of their peers; they read a lot so they can foresee emerging trends; and they keep themselves fit and eat well, realizing that good physical health is also an investment in their future.The millionaire mindset dares to be different and is open to being wrong. It can stomach “reasonable” risk and understands that risk inherently includes the risk of failure. Millionaires also hone their risk taking over time. As Frank McKinney, a maverick real-estate millionaire known for building luxury spec homes advises, “Exercise risk like a muscle… take a calculated risk and then see if it pays off and then take another calculated risk and see if that pays off, too, and soon you’ll start to better trust your own judgment and analysis.”The millionaire mindset is comfortable with taking reasonable risks, but, to be clear, they don’t gamble or put themselves or their families in harm’s way for a dream, but assess the situation and take a chance only if it seems like a reasonable risk could deliver a worthwhile return.Millionaire mindsets are also programmed to quickly bounce back from adversity and move in continuous forward motion even when failure and setbacks happen...

Think Twice Before You Price Your Home

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLAs a real estate agent of some 27 years, Terry Story has seen her share of ups and downs, bad markets and good markets, homes under water, new construction thriving or lagging, but every once in a while, something a little different enters into the picture.The standard for pricing a home for sale has typically been to list it above the value or above what the seller wants and then to negotiate down from there to an agreeable number. Terry says a smarter approach is to list the home either at or slighter lower than that figure. This idea may sound counterintuitive, but it actually attracts multiple buyers who then engage in a sort of bidding war ending with the home selling for above the list price.  So thinking twice before you price your home may be just what you need.As an example, Terry recently had three offers for a home valued at $300,000 that was listed at $299,000 which brought in three offers and eventually sold for $310,000. This more creative pricing is something that Terry says can move a home more quickly and also weeds out the less qualified buyers. With several bids in for one property, the race is on for prospective buyers to get approval and win the “contest”. Exposing a home to the greatest number of people is key, so if you’re selling on your own, you’re really missing out on the exposure a professional agent can bring to the picture.Summer traditionally is the best time to buy or sell a home, and Terry thinks this is particularly true right now since the current low-interest rates and home prices are bound to rise before too long. Many people who were held captive in their homes after the 2008 crisis are finally realizing some equity which allows for more relocation to areas with better job opportunities, all of which contributes to a healthier economy and to a more vital and stronger real estate market.So if you’re sitting around wondering when it’s a good time to sell your home, Terry Story will tell you “right now”. And if you ask her when it’s a good time to buy, Terry’s answer will be “right now”. Sage advice from a seasoned veteran.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Roundup.  This is the time every single week we get together with noted real estate agent, Terry Story.  Terry is a 27-year veteran with Coldwell Banker located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: One of my favorite parts of doing this segment with you is when we start to find out about your work and what challenges you face on a daily basis, but you've got some tips for getting the most money when selling your house.  What are they?Terry Story: Steve, this is going to sound counterintuitive, but price the home. I'll give an example.  Let's say a home, the market value is $300,000.  You could either price it at, let's say, $325 or $299,500 or any number comparable to those.  If you were to take that home that's worth $300,000 and you price it right at that number, slightly below, what happens is you're going to, if it's priced right, you're going to have a strong response from the buyers because they recognize the value, and you will get multiple offers.  I just did this the other day.  I had somebody…we debated where we should price it at.  I said the value was around $300,000.  We talked about $325 versus $299.  We put it at $299.  We got 3 offers.  I ended up selling it for $310,000.Now the why?  Because what happens is you're allowing the buyers to bid against each other, and that way, as a seller, you don't have to wait for that one offer and you're trying to win that negotiation against that one buyer.

4 Simple Ways To Maximize Your Credit Score Right Now

Our economy is fueled by the stuff we buy and sell—you know that—and it includes all kinds of transactions by individuals, by businesses, by governments, and, nowadays, most of these transactions don’t include cash. They either use credit or, increasingly, online services, such as Paypal or other mobile pay applications. Think about it: When was the last time you paid for something significant with cash?So in our credit-based world, an individual's credit score is an all-important factor in making credit transactions affordable at low-interest rates. While we use credit or debit cards for routine transactions, big-ticket items, such as mortgages or car payments, require new lines of credit with lenders calling credit-rating agencies to check on your credit scores. But each time there's a “hard” inquiry, your credit score takes a hit.But how much of a hit do your scores really take—a bit, not too much? It’s typical for the score to drop 5 to 10 points after a hard credit inquiry. But there’s a bit more to it than that behind the scenes.How Applying for Credit Can Effect You.The hit isn't the same for everyone because your history with credit matters a lot. With hard inquiries, the change in your score depends on factors such as how long you’ve been using credit and whether your credit report includes any late payments, delinquencies, etc.An inquiry’s effect on your credit score also depends on what you’re applying for. Many scoring models combine multiple credit inquiries and put things, such as mortgage, auto or student loan inquiries, together to allow consumers to shop around for the best rate, without worrying about how much each inquiry might ding their score. Depending on the scoring model, that “rate shopping” period, in which multiple inquiries count as one, can vary between 14 to 45 days. This is new and very important. One of the great obstacles for shopping around was the negative impact it would have on your credit rating. The rating agencies got smart and did away with this restriction. Bravo for them!Credit card applications have a different scoring modelEvery time you apply for a credit card, you take points off your score, typically about five points or less for each credit card application.It pays to do your homework and shop around.Experts suggest that consumers shop around for credit to help minimize the damage that inquiries cause to your scores. But first, do your homework in terms of credit card applications. Doing your homework before you apply will give you an understanding of the qualifications different cards have ahead of time. This way you can, for instance, avoid applying for a card that requires a high score if your score is low and avoid the futility of getting a sure-shot rejection letter while also having the hard inquiry impact your score.Be Strategic.It’s a good idea to only apply for credit when you need it  and to time your credit card application so it's not when you have major purchases coming up that could be affected by recent inquiries on your credit report. For example, if there is any likelihood of your applying for a mortgage in the near  future, don’t apply for new credit because you could lower your score and increase the interest rate on your loan. So hold off on applying for any new credit until after closing on the home. But don't overly sweat it because, on the bright side, the score tends to be somewhat forgiving of negative new account impacts, with any such harm tending to lessen after about six months of history.Keep an Eye on Your Credit.Immediately after applying for credit, your score may drop a bit, but, like I said, this dip isn’t permanent. So if you've kept credit balances low and have not missed making timely payments, your score should recover and even improve over time if you are a disciplined user of credit.

Bonds: The Nerds In High School You Should Have Befriended

Whenever any of us decides to tune into the financial media to see what’s going on and learn possible places to invest our money, all we hear about is stocks—such and such stock is hot, such and such is not, and so on—however, you rarely hear about bonds. I guess they’re not as interesting as stocks. Bonds are pretty stable, mostly pay a fixed interest rate, and mature sometime in the future, so they’re kind of boring.I’m not going to argue that point. They are and should be boring— that is the point—which is why they hold a valuable place in the diversification of your hard-earned money.But, ah, here’s the rub. We all know that interest rates are low, right? You can borrow money to buy a home and pay under 4%. That’s a loan to you for 30 years at under 4%. It’s ecstatically low! So it’s one thing to borrow money at a low rate, but if you lend the money at a low rate, it looks less attractive.By the way, lending money is the definition of a bond. When you own one, you are, in fact, lending money to someone or some entity. Take Apple, for example. This year, Apple issued $12 billion worth of bonds that mature in 30 years. The interest rate you would receive if you bought it is 4.65%. Would you loan someone money for 30 years for 4.65%? Let’s say you were unsure if Apple was going to be around in 30 years for you to get your money back. Let’s say you only wanted the safest security on the planet. That would be US Treasury Bonds. Right now the yield on the 30-year US Treasury bond is 2.3%. After taxes and inflation, you are actually losing money. So, as interest rates continue to be low, bonds do not look attractive to most investors.As investors know, central banks are keeping rates low, low, low to ward off the risk of recession in an uncertain environment. Despite on-again off-again expectations of tightening from the U.S. Federal Reserve, benchmark rates seem likely to stay pretty much where they are for some time to come.Even so, the collapse in yields worldwide has left U.S. corporate bonds as one of the last places on earth to get relatively safe, steady income. So while investors fret over low-interest rates and low payouts, the relative attractiveness of U.S. corporate debt has drawn in billions of investor cash. That could be a boon for American businesses who, like Apple, can borrow almost unlimited amounts to drive their competitive advantage in a global marketplace.And this low-interest rate scenario means bonds are expensive because bond prices go up as rates drop in an inverse relationship. And for individual investors, who have to pay transaction costs, yields are even lower.So a natural response might be to look beyond bonds and concentrate on dividends. For example, if you buy an S&P 500 type index fund that concentrates on the higher dividend paying companies, you can get around a 3% yield, which isn’t bad for a diversified income play compared to traditional fixed income options. Individual stocks can offer even higher yields, of course, and you don’t have to go crazy with risk-taking to find them. For instance, a lot of banks offer dividend yields north of four percent.But it’s when you get greedy that the troubles with non-bond income generators might start to appear. There is always the risk of dividend cuts and other unforeseen issues that accompany the uncertainty of certain investments, like stocks and real estate.This might sound counter-intuitive after noting how low bond yields are, but the uncertainty of dividend yields only highlights the real value and role of bonds. At the most basic level, in a well-constructed portfolio, bonds are there to diversify risk. After all, when stocks do poorly, bonds usually do betterSo while you should goose your portfolio with solid income-generating dividend stocks, investors should not give up on safe-haven bonds, despite the low yields,

Pokemon Go Is Just The Beginning Of A Whole New Reality

With Andy Serwer, Editor-in-Chief of Yahoo Finance, Former Managing Director of FortuneJust when the real world got comfortable with the idea of virtual reality, along comes this thing called augmented reality.Besides the Bento box and karaoke, many aspects of Japanese culture have seeped into the American lifestyle. But perhaps nothing can equal the impact of Pokemon Go, a by-product of the Nintendo game Pokemon. If someone walks into you on the street these days and he doesn’t have a walking stick and a guide dog, chances are he’s playing Pokemon Go, the craze that has captivated millions and is lifting the Japanese economy up from the doldrums.Andrew Serwer, Editor-in-Chief of Yahoo Finance and former Managing Director of Fortune, has written a thing or two about Japan in his career as a journalist. He recalls that before it began to unravel in the early ‘90s, the Japanese stock market, real estate market, the economy, in general, was booming. Now, after several stagnant decades, Japan is coming back, to a large degree because of the popularity of Pokemon Go and to LINE, a giant messaging app.Although both are products belonging to the tech world, Pokemon Go is the one causing bodily bruises and mishaps as well as initiating the world into augmented reality, the combination of virtual reality and the real world. In such a short time, a game that’s obviously fun for millions has become a boon to some enterprising businesses who have capitalized on it as a lure to attract customers. A character just might be located in a pizza parlor or coffee shop where—Surprise, Surprise!—a discount could be offered.Andrew says this is the first of many applications of augmented reality and that CEOs of major corporations are already thinking of how it can be used in their lines of business. The potential and possibilities are enormous and most certainly will be popping up in areas beyond games, such as dating apps, exercise apps, and for educational purposes.In the meantime, as walkers and drivers addicted to Pokemon Go struggle to pay attention to the sidewalk and the road, Japan is experiencing a much-needed boost in the stock market, which is a good dose of reality for the once-wobbly economy.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: My guest is Andy Serwer.  He is the editor-in-chief of Yahoo Finance, and he's best known for serving as a managing director of Fortune from 2006 to 2014.  He's based in New York City where he’s on the line with me today.  Andy Serwer, welcome to the show.Andrew Serwer: Thanks, Steve.Steve Pomeranz: You wrote an article where you mentioned Pokemon— and, of course, in the last week or so, Pokemon has exploded onto the scene—but you also mentioned that coming out of Japan (and some other things coming out of Japan) the Japanese stock market rose dramatically, it's almost like the '80s again in Japan.  Just quickly tell us about that.Andrew Serwer: Well, if you remember, Steve, back in the 1980s, it seemed like Japan was taking over the world economically.  Remember, they came in and bought Rockefeller Center in the United States and Pebble Beach, the golf course.  Their stock market was booming, real estate values there boomed, and then, in 1990, it all began to come apart, and the economy crashed, and it's been a zombie economy for all those years and years.  Never really true because it's still been an awfully big market, but kind of a backwater until maybe this week.Steve Pomeranz: What happened?Andrew Serwer: Well, a bunch of things happened.  First of all, you mentioned Pokemon Go, and we can talk about that a little bit.  There was also a giant IPO this week, Line, l-i-n-e, which is a giant Japanese messaging app, not unlike Wii Chat and Snapchat and all of those.

Building Your Brand? Beware Of These Traps

With Julie Cottineau, Author of Twist: How Fresh Perspectives Build Breakthrough Brands, Founder and CEO of BrandTwistBreaking away from the competition in today’s crowded world is a challenge for any business. How to become the next hot concept or product is the subject of Julie Cottineau’s new book, Twist: How Fresh Perspectives Build Breakthrough BrandsAs a brand consultant and past Vice President of Brands at Richard Branson’s Virgin Group, Julie experienced that “aha” moment one day that led her to realize “that the way to really break out in any category is to take off your brand blinders, to forget about what your competition is doing, look at brands that you love that are breaking through, that are doing well in other categories, and use or twist those best practices.”Some of the key misconceptions with many businesses are:*Believing that a brand is the same as a business  model.*Thinking you must mimic the competition to succeed.*Not realizing that your logo, website, and name do not in themselves constitute a brand.In her book and on her website Brandtwist.com, Julie advises her clients to become students of brand. Not only knowing which brands are the most noticeable, but those that pull you in, the ones you tell your friends about, the ones you order from or go to for service—these are the ones you can borrow from to develop your own brand.The technique to building your brand effectively can begin as early as high school, says Julie. Since the competition to get into college these days is so fierce, she recommends focusing on some unique quality that sets you apart and grabs the attention of the admissions department. She cites the example of her own daughter who combined her passion for music with community service and work projects as well as incorporating it into the theme of her college essay.Instead of imitating your competition, the twist within Twist: How Fresh Perspectives Build Breakthrough Brands is removing your “brand-blinders” to find that singular quality that best defines you and sets your business apart from the pack.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: In a crowded business world where everyone is vying for our short attention spans, being very different from your competition is the key, and branding is one of the most important ways for businesses to break out of the crowd.  Not only businesses but also for us, as individuals, personal branding is another important tool to help us get what we want from this crowded world.  Julie Cottineau is Founder and CEO of BrandTwist, a brand consultant and creator of brandschoolonline.com.  Prior to launching her own business, she was Vice President of Brands at Richard Branson's Virgin Group.  Her new book is

The Age Old Question: To Rent Or Buy?

With Terry Story, 26-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLIt always seems like such a conundrum: is it better to rent or buy?  After 27 years as a real estate expert, Terry Story still has to answer, “it depends”. Not only is the real estate market local, it’s also changeable. Like the stock market, things go up and things go down, so you just have to know where you are in place and time.Terry says that after about five years of rising rental rates, “we're starting to see a surge of multi-family permits and buildings going up creating more supply.  As you know, when you have more supply, the prices start to come down.” Not only will there be more choices for the renter, but many of these new rental properties will begin competing against each other which will further drive down the cost and create the option for more amenities than before.For business owners looking for office space, however, Terry refers to Res.Inc which reported that US office vacancy rate had fallen to a seven-year low, meaning that prices will be on the rise in this area.Back to the decision of whether to buy or to rent a home, Terry advises the third of all home buyers who are 35 years or younger to buy if they plan to stay in the home at least for two years. That two-year mark along with interest rates now hovering in the 3.6% zone almost ensures that buying is the better way to go. That being said, Terry cautions against making a purchase that is more than 28% of your gross pre-tax income on a monthly basis. Another factor to consider is the amount of hidden costs in being a home owner—taxes, insurance, lawn care, incidental maintenance, and repairs.Going back to the question, “Should I rent or buy?”—after everything is taken into account and the numbers add up, at this time and in most places, it’s a good day to buy a home.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Roundup.  This is the time every single week we get together with noted real estate agent, Terry Story.  Terry is a 27-year veteran with Coldwell Banker located in Boca Raton, Florida.  Welcome back to the show Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: Many people are still renting, and home buying still is a challenge for many.  What is going on with the rental market?  Are prices or rents still rising as they were?Terry Story: Yes and no.  It's starting to lose its mojo.  I like the way that sounds.  Basically, what we're seeing, Steve, that the rents have gone up so much in the last five years—they jumped up about 20% nationwide during this five-year period of time—but we're starting to see a surge of multi-family permits and buildings going up creating more supply.  As you know, when you have more supply the prices start to come down.  These buildings aren't built overnight, so it does take time, and it takes a couple of years.  You can even see in our own market.  We've got lots of buildings going on, and that's going to make the prices begin to fall a little bit.Steve Pomeranz: In your own community, if you see buildings going up, and they are rental buildings, know that that's probably a good sign if you're a renter.  First of all, it gives you more options, and, secondly, there may be a time in some future where these projects will start competing against each other.Terry Story: Yeah, like, for example, in New York, they're going to see 2.6 times more apartments in the next year.  It's a historical average in Boston of 2.5 %.  These areas should start to see the prices soften a little bit, or the developers or the community's offering more amenities, or giving you a free month rent, that sort of thing.  It's by no means indicating that there's not a demand—the de...

Can’t Stop Spending Money? We’re Here To Help

With the long warm days of summer and with kids off from schools and colleges, it's tempting to want to get out and splurge on holidays and getaways, summer concerts, activities for the kids, etc. All this summer fun shouldn't end up breaking your budget, however, by throwing you off your savings and investment plan or—worse—having you dipping into retirement funds or landing you in serious credit card debt.Here are a few steps to help you enjoy your summer guilt free, without breaking the bank.* Rein in Your SpendingCan't stop spending money?  As I always say, with most things financial, it really helps to start with a plan well ahead of when you anticipate spending, ideally six months before your planned “summer” expenses so that you can set aside small amounts every month towards your upcoming trip, vacation, or shopping plans. As a first step, always create a spending plan – and the sooner, the better.It’s important to resist getting carried away and to keep your spending in line with what you can reasonably afford. In fact, one of my key pieces of advice to my clients is to get comfortable with your financial status and spend according to your budget, not your social aspirations. If you can maintain that financial discipline, you're virtually assured of a comfortable financial nest egg.Now, if by chance, you’ve already landed yourself in debt, then focus on putting together a debt repayment plan as your next step. A good first step is to absolutely stop using credit cards to cover your everyday living expenses and learn to live within your financial means. The sooner you stop living on credit, the better—otherwise you could find yourself deep in debt. If you have moderate credit card debt, then the next step is…* Consider a Balance Transfer Credit CardA balance transfer credit card offers a reduced rate of interest for a limited time and that could help you pay off debt faster. Sometimes, you may even get an offer that waives off the roughly 3% fee that accompanies most transfers. But make sure you use the balance transfer credit card to cut back on your debt, not as yet another card you can spend on.Be aware of the “teaser rate” time frame which typically lasts between 4 and 18 months and make a plan to have the debt paid off by the expiration. If not, you may end up right back where you started.Also, know that a balance transfer on a new credit card could ding your credit score…* So Keep an Eye on Your Credit ScoreAbout a third of your credit history is impacted by your payment history, so if you are unable to make your debt payments on time or if you skip them altogether—a big no-no—then your credit score will take a severe hit.On the flip side, if you work to pay down your debt and use less credit than is available to you, you will likely start to see your score improve. If you're approved for expenses of up to, say, $5,000 on your card and only spend about $1,500 or so per month and pay your card in full every month, you'll steadily improve your score.And with online fraud, identity theft, and phishing scams aiming to steal your personal information, it's always a good idea to review your credit report once a year to make sure there aren’t any problems, like errors or fraudulent accounts that could tank your credit even if you've been doing everything right. So make sure you get a free annual credit report each year from sites such as AnnualCreditReport.com and do all you can to live well within your financial means and to quickly clear all outstanding debt.Finally, let’s discuss the Snowball Effect. This is one of the most powerful financial forces in the universe, second only to the magic of compounding. This is not theoretical for me since I have experienced this myself and kn...

Create Wealth The Cheap And Easy Way

With Spencer Jakab, writer and editor of the Wall Street Journal column, “Heard on the Street”, Author of Heads I Win, Tails I WinSpencer Jakab, writer and editor of the Wall Street Journal column, “Heard on the Street,” has heard it all. All the hype, all the advice, all the dos and the donts swirling around the media from every point of view, bombarding the confused investor from all angles, and every source about as reliable as flipping a coin.In fact, that is exactly the premise of Spencer’s new book, Heads I Win, Tails I Win, a valuable read for the novice and the experienced investor alike because we’re all vulnerable to the latest and loudest horn blower out there. Spencer thinks that most financial advice is “basically useless and a little bit of it is worse than useless in the sense that you are being led down a primrose path.”  His somewhat unorthodox advice, which he says can be summed up in about eight bullet points, is essentially to be cheap and lazy, and that entails a bit of passivity and deaf ears.The average investor, he says, typically performs well below the market average as a result of zigging where he or she should have zagged, poor timing, over-reacting to news such as Brexit, and getting seduced by the latest financial fad. The antidote, Spencer says, is to be as lazy and as passive as possible in the face of these temptations, to stick to a plan, and to tell yourself: "I'm going to rebalance on this date; I'm going to have this allocation; I'm not going to let this scary headline or this hot new trend derail me from that." The other half of Spencer’s advice is to be cheap, to pay as little as possible, not more than one-tenth of a percentage point for a bond or stock fund. In times of low returns, such as now, that alone can save you money and double your nest egg.The influence of the media is ubiquitous and seductive. And scary financial rants and doomsday prophecies that create a collective adrenalin rush garner the best TV ratings, something that never happens when everything hums along nicely.  Spencer advises taking the grain of salt approach and sticking to your plan.Acknowledging, however, that we often are no match for the force of current trends and headlines, a professional fee-only advisor can be the neutralizing voice of reason—especially during an anxious time such as we experienced with Brexit or back in 2008 with the Lehman collapse—that can prevent a costly misstep.So while Spencer cautions investors to remain lazy and cheap, he concedes that for most of us “having counsel and having counsel where their interests and your interests are aligned is a very smart thing.”  Full of interesting anecdotes Heads I Win, Tails I Win is a concise and entertaining investment guide that aims to keep you on the sane and, ultimately, successful path to financial wealth.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: Spencer Jakab writes for and edits the “Heard on the Street” column for the Wall Street Journal and was a top rated stock analyst covering emerging markets at Credit Suisse.  His new book, Heads I Win, Tails I Win, is a very good book for the novice and the experienced investor alike, so let's meet him and find out what he has to say.  Welcome to the show, Spencer.

How Panic Is Infecting Our Financial System

With Professor Hal S. Scott, author and Nomura Professor and Director of the Program on International Financial Systems at Harvard Law School, Author of Connectedness and Contagion: Protecting the Financial System from PanicsThe impact of the financial crisis of 2008 ran deep. Everyone from the man on the street to the Federal Reserve felt the tremors to some degree.  As a result, the US government instituted a series of regulations designed to prevent a replay of those events. But will they actually do the job?Professor Hal Scott, the Nomura Professor and Director of the Program on International Financial Systems at Harvard Law School, is doubtful.  In his book, Connectedness and Contagion: Protecting the Financial System from Panics, he explains his thesis.Back in 2008, while the financial world was falling apart one banking and financial institution at a time, the Federal Reserve came to the rescue, like a caped crusader with a huge safety net. They guaranteed market funds after the failure of Lehman Brothers, lent money to those banks on the point of failure, and increased insurance limits on ordinary demand deposits, in essence, acting as the lender of last resort.The contagion that Professor Scott refers to in his title is the irrational panic that causes everyone to want nothing more in such critical times than to withdraw their money and stuff it in a safe deposit box or under the mattress, all of which has a huge impact and can exacerbate an already shaky situation.The collapse of the housing market got all the credit for the crash, when, actually, it was so much more complex, states Professor Scott. The decline in housing prices “evolved into something quite different where you had runs on money market funds that weren't holding anything, where companies like Xerox couldn't issue commercial paper.”  And it quickly became a panic about everything. During a financially vulnerable period, it’s obvious that depositors and investors are not privy to the same information as those on the inside of these financial institutions, so, mostly heeding the advice of their peers, the public becomes infected with distrust and fear allowing a “head to the hills” mentality to take over.We just experienced a global version of this contagious fever with Brexit. The doomsday prophets were all over the media, and even though we haven’t seen it all play out yet, the sky did not fall on Europe’s head.After the financial crisis of 2008, the US government passed the Dodd-Frank Wall Street Reform and Consumer Protection Act which imposed regulations on financial institutions designed to prevent another such outbreak. In his book, Professor Scott tells why he thinks the issue was incorrectly addressed. Dodd-Frank, he says, requires banks to shore up their capital in order to weather another financial crisis, but if panic takes over again and depositors demand their money, no amount of capital would be sufficient. In addition, many of the measures that successfully warded off disaster in 2008— lender of last resort, deposit insurance, guarantees by the Treasury in the money market funds, and TARP—have now been restricted or eliminated.Should another crisis occur, political or economical, Professor Scott says, “we would not be in a really good position to fight it.” Congress and the public, to a degree, have become so averse to the idea of bailouts t...

Navigating the Risks and Rewards of Our New Renaissance

With Ian Goldin, Professor of Globalisation and Development and Director of the Oxford Martin School at the University of Oxford, Author of The Age of Discovery: Navigating the Risks and Rewards of Our New Renaissance“It was the best of times, it was the worst of times,…it was the season of Light, it was the season of Darkness…”, so begins A Tale of Two Cities, Charles Dickens novel set in London and Paris in the context of life before and during the French Revolution. Some might apply these lines to the sentiments of many in today’s world of rapid change and global discontent. Ian Goldin offers a different view, an optimistic view, in his new book, The Age of Discovery: Navigating the Risks and Rewards of Our New Renaissance.As Director of the Oxford Martin School at the University of Oxford, past Vice-President of the World Bank from 2003 to 2006, and advisor to President Nelson Mandela, among other distinguished positions, Ian Goldin speaks with historical perspective and international acumen when he states that, on the contrary, these are the best of times.  We’re living longer, healthier lives than ever before; our average incomes are higher; our access to many choices and freedoms is higher; and yet, he acknowledges, there’s a general mood of pessimism in many places.Goldin refers to the present as a New Renaissance and to explain the general discontent taking place in spite of such optimistic and exciting elements in our society, he highlights several factors.The world has been fundamentally transformed in the last 26 years, since the fall of the Berlin Wall, and the rate of acceleration has upset our equilibrium. “When change happens more rapidly,” he says, “people get left behind more rapidly because if you aren't able to change, if you aren't able to change jobs… or go to where the jobs are, or you don't like the changes, you get left out of change more rapidly.  Inequality is growing in many countries between people that are able to benefit and those that aren't able, and the sources of uncertainty and complexity are growing, as well.” A recent example is the reaction of a block of disenfranchised people voting for Brexit, Great Britain’s decision to leave the European Union.Goldin points out a distinct parallel between the present time and the European Renaissance of the 14th and 15th centuries, which was most certainly a period of tremendous disruption. The world rose up out of the Dark Ages with an explosion of great artistic, humanistic, and scientific achievements. Great men doing great things filled with imagination: Michelangelo and da Vinci, Copernicus, Galileo, Gutenberg, Columbus, Magellan, and so many more. Not only did people have exposure to great works of art, but the printing press allowed the dissemination of information and knowledge, and the world, which had been a rather small place, suddenly expanded geographically.But then what followed was a backlash, a pushback from extremists and reactionaries: Savonarola and the Bonfire of the Vanities, Luther attacking the corruption of the Catholic Church, The Catholic Church instituting the Inquisition, heretics, homosexuals, Jews, Muslims were hounded, and no one felt safe. Ultimately, Europe was pulled back to the mental dark ages.The lesson from those events, says Goldin, “is how these periods of tumultuous change can lead very, very quickly and very surprisingly to these rapid reversals. In such times, there are always those whose lives actually don't improve, who feel left behind and discontented and rese...

Planning To Flip A House? Consider This First

With Terry Story, 26-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLAlthough home sales are doing well these days, the home renovation business is thriving. Terry says there are two kinds of renovators out there— first-time buyers fixing up older homes and long-time homeowners choosing to stay and fix up the place.The largest group is the new home buyers who purchase older homes because of location or price and take on ambitious projects such as remodeling kitchens and bathrooms, adding on rooms, or major landscaping. Generally, they’re spending an average of $66,000 on such improvements.The other group, those who have lived in the home for perhaps 25 years or so, spend about $36,000 making upgrades and enhancements as the alternative to moving.Terry says this is an excellent time for anyone selling products or services for remodeling—contractors, carpet and flooring specialists, stores such as Lowe’s and Home Depot.As a busy real estate agent, Terry often encounters problems that can derail a closing date on a home sale. Since few people can pay cash for a new home, for the most part, these delays or cancellations are related to issues with the buyer’s financing.  Quite often, the buyer of a new home is faced with having to first or simultaneously sell their present home before being able to take on the costs for the new one. For some, bridge loans are an option as is tapping into a home equity line of credit. Terry’s advice to her clients is to have a plan in place should the timing not be so well coordinated.In closing, Terry comments on the flipping phenomenon that was so prevalent back before the housing crash. Instead of buying and trying to flip a house, as in the past, Terry says investors are buying, fixing, and then renting. Since rents are on the rise, this practice usually brings a good rate of return.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Round-up.  This is the time every single week we get together with noted real estate agent Terry Story.  Terry is a 27-year veteran with Coldwell Banker located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: I know that home sales are doing rather well, but I think a lot of people these days are deciding to stay in their home and renovate.  What's going on in the renovation market?  Is there more than one type?Terry Story: Absolutely, Steve.  There are actually two kinds of renovators.  What we're seeing, the largest group of people renovating are the new homeowners.  They're taking on the larger projects, so somebody who just purchased a home and they want to redo it.  They didn’t want to buy an old house.  They wanted to buy something that is more centrally located, so they're buying that older home, turning into bigger projects.  For example, they're remodeling the kitchens, that’s the most popular.  Then they're tackling the bathrooms and then maybe doing curb-appeal projects such as painting the house, roof, et cetera.  They're spending on average about $66,000 on homes.Your next kind of home owner/renovator, they're spending about $36,000.  That’s the person who's been in their house 25 years.  They don’t really want to move, and they tend to tackle the projects on their own.  They might not hire that general contractor, therefore, they tend to spend less.Steve Pomeranz: Yeah.Terry Story: The new home-buyer coming in spends a lot more than the current person currently living in the house.Steve Pomeranz: Yeah, so this is a good time for anyone really in the local remodeling construction business, I guess, for people who sell flooring and those kinds of services as well.Terry Story: Absolutely.

Beware: Rolling Over Your 401k Is About To Get Weird

When most working Americans leave their jobs—voluntarily or otherwise—they are often clueless about what to do with their company-sponsored 401k plans. Do you keep it with your former employer, transfer it to your new employer’s plan, roll it into a traditional or Roth IRA, or take a lump-sum distribution? That’s what I plan to address today to help you know what you should consider when faced with this dilemma.This topic is also relevant because of the new conflict-of-interest rule (which I spoke about a few weeks back) which mandates that financial advisers do what's in the best interest of their clients. Earlier, advisers almost always recommended rolling your 401k into an IRA when you left your employer because advisers earned commissions or fees on that rollover. But under the new rule, starting next year, advisers will no longer be able to give a knee-jerk answer to the "should you leave your 401k with your former employer or roll it over to an IRA" question. Instead, they will have to act in your best interest, just like fiduciaries who analyze your options and suggest a course of action that’s right for you.So here are some things to consider before you convert your 401k to an IRA:What does it cost?Generally, leaving your 401k with your former employer or transferring it to your new employer—if that’s an option— costs less in fees and expenses than if you work with an adviser when rolling it into an IRA.What are your investment options?Generally, you have fewer investments to choose from in a 401k relative to an IRA. On average, there are 25 investment options in a 401k versus thousands in an IRA. And getting back to cost, your investment choices in an IRA are often cheaper than a 401k plan because an IRA lets you invest in a range of low-cost index funds and ETFs.So now you want to look at the differential in costs. The investments themselves can be cheaper in an IRA versus your 401k, but if you need investment advice you will have to pay them. If you contact an adviser, have them calculate the net difference in costs between what you’ll save on the investments versus the added cost of hiring someone to help you. Then, if you think you need help, you’ll know exactly what the additional cost is and you can determine if it’s worth it.Do you need the money before age 59½?If the answer is “yes” that you may need to withdraw money from your retirement plan before the age of 59½, then avoid rolling your 401k into an IRA simply because you’ll pay no penalty if you withdraw from a 401k before the age of 55, but you will pay a full 10% penalty when you draw money from your IRA before the age of 59 ½. So if you need to withdraw, say $20,000, you'll have to fork over $2,000 as penalty and that's serious money. So think ahead on what your future spending needs look like and stay in your 401k if you think you might make a withdrawal. That said, I really want you to plan things so you don't tap into retirement savings. You really want them to grow steadily over time because withdrawals can often set you back more than you might think—and that might break the good discipline of regular savings and investment.Do you need creditor protection?Here's something else to consider: 401k plans have federal protection from creditors. Your IRA may not and also may have fewer protections that vary from state to state. So if you need federal protection, consider leaving your 401k with your former employer or transferring it to your new employer’s planOther factors to consider:If you're considering a lump-sum distribution, just make sure it's not a taxable distribution. A good financial adviser will be able to steer you properly about your options. Many plans have all-or-nothing rules, so either all your money stays with the plan or all of it goes. Make sure, whatever you decide,

Understanding Today’s World Through The Lens Of Star Wars

With Cass Sunstein, Founder and Director of the Program on Behavioral Economics and Public Policy at Harvard, Former White House regulatory czar, Author of The World According to Star WarsWhat Does Luke Skywalker have to do with Ruth Bader Ginsburg or Brexit with Star Wars? Turns out that in Cass Sunstein’s new book, The World According to Star Wars, there are parallels with both.Cass Sunstein, Founder and Director of the Program on Behavioral Economics and Public Policy at Harvard University and currently the Robert Walmsley University Professor at Harvard generally writes books and articles of a more serious nature, but this time, he was inspired by his then five-year-old son’s obsession with all things Star Wars.  Focusing on the star-power, as it were, of a phenomenon that has spanned over four decades, earned 30 billion dollars, and captured the imagination of children and adults all over the world, Cass questioned the driving force within Star Wars.George Lucas, the creator of Star Wars, has often spoken about the influence of Joseph Campbell’s 1949 book The Hero with A Thousand Faces which outlines the age-old motif of the hero’s journey, one of the cultural myths embedded into all cultures and religions. The usually reluctant hero is called upon to face a formidable challenge, survives after walking though moral and physical hot coals, and then ultimately returns home in victory, like Homer’s Ulysses and Lucas’s Luke Skywalker,In his book, Sunstein uses episodes of Star Wars as lessons in constitutional law, global economics, and political uprisings.  He also explores the choices, both ethical and practical, we all must face in life. Every pivotal stage of history has its own dominant force, whether for good or evil, that propels societies and cultures in new directions. In the US today, many people are feeling disenfranchised, unhappy with the economy, with lack of opportunity, with government interference. They feel frustrated with our leaders’ inability to enforce change, and so the stage was set for what is taking place in our present presidential campaign—from the left, from the right, from Bernie Sanders (while he was still a challenger to Hillary Clinton) to Donald Trump. The old order, the status quo is being challenged, and a rebellion, even of spirit, is definitely taking place.  As the recent Brexit vote in Great Britain exemplifies, this force is not just happening in the United States but is taking on a global proportions.Cass draws an interesting analogy between our judicial system—and the Supreme Court, in particular—to an aspect of Star Wars.Each of the seven episodes of Star Wars must be faithful to the one preceding it, explains Sunstein, so that each episode adds a layer to the total story and must be faithful to what came before. The Supreme Court must perform in much the same way, where each case, whether it involve affirmative action, abortion, same-sex marriage, or any other issue must respect the actions and judicial decisions that came before. Of course,

How Nathan’s Famous Became America’s Top Dog

With William Handwerker, grandson of Nathan Handwerker, Author of  Nathan's Famous: The First 100 Years, An Unauthorized View of America’s Favorite Frankfurter CompanyHot dogs on the Fourth of July—or any other day of the year—often means Nathan’s Famous on a bun.But back in 1916 when Bill Handwerker’s grandfather opened a small frankfurter stand on Coney Island, he wasn’t seeking fame as much as survival in a vast sea of other frankfurter stands. How Nathan Handwerker blew away the competition is the subject of his grandson, Bill Handwerker’s new book, Nathan's Famous: The First 100 Years, An Unauthorized View of America’s Favorite Frankfurter Company.Nathan Handwerker arrived in New York City in 1912, the period of the great European immigration, not knowing the language or the culture of his adopted land. Within four years, he opened his first stand serving French fries, malted milkshakes, and frankfurters, the traditional fare offered by everyone else all along the busy stretch of Coney Island. Competition was intense.To differentiate himself from the pack, Nathan boldly slashed the price of his frankfurters in half, from ten cents to five. When his unhappy competitors struck back with rumors that he had compromised the quality of his product in order to reduce the price, Nathan reacted with the spirit of a pioneer American entrepreneur. He had people dressed in doctor’s coats and stethoscopes (borrowed from a local hospital) eating hot dogs in front of his restaurant, so passersby would think, “Well, if a doctor can eat here, it must be good for you.” And Nathan’s was on its way to becoming the iconic brand we know today.Bill writes that it wasn’t exactly a straight path to success from that point forward, however.  As in most longtime businesses, there were ups and downs.When Bill’s father came back from World War II, he recognized that Nathan’s Famous had to join the mass migration to the suburbs; a simple stand on Coney Island couldn’t sustain the growing members of the Handwerker family anymore. And so a second store was opened on Long Island, and more were to follow.By the time Bill himself came onboard, the company was thriving, and Nathans’ Famous was a packaged item on sale in supermarkets across the country. One of the setbacks occurred, however, when Nathan’s Famous purchased Wetson’s, a prominent hamburger fast food outlet, a venture that was to prove costly and count as one of the missteps in the history of the company. Nathan’s survived this setback, however, through a lot of hard work and an uncompromising dedication to quality and service, which Bill claims is the primary reason behind their 100 years of success.Today the company is no longer family-owned, but the legacy left by a Polish immigrant who turned a simple frankfurter into an iconic brand is a success story as American as apple pie.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: From a meager frankfurter stand in Coney Island, New York in 1916, to America's most loved and iconic household brand, Nathan's Famous is an icon we all know.  My next guest is the grandson of the founder of Nathan's Famous, and he has written a book,

Will Brexit Affect The Value Of Your Home?

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLTerry Story always has her real estate eye fixed on the local market and, therefore, is tuned into the potential effects Brexit could have in South Florida. “In the short term,” she says, “the US could be flooded with investors flocking to the US as a safe haven, putting more demand on real estate, and, of course, that would be a good thing for us.”  Also, she adds, interest rates will likely remain low or go down, meaning that mortgage rates will be more attractive to the home buyer. Recently, we saw average home mortgage rates of 3.46%, producing lower monthly payments and giving the buyers greater buying power.  “To give you an idea what this means,” says Terry, “it'll allow the average home buyer to buy 8% more expensive of a house.”Home prices have climbed overall in April, with five US cities showing record home values and 20 major markets having double-digit annual increases.  The cause here has nothing to do with Brexit, but with shrinking inventory, which was actually created by the pushback from buyers who refuse to consider paying such inflated prices.One of Terry’s resources for real estate news, a report called The 8 Critical Trends in Real Estate, predicts that commercial projects will decrease as many insurance companies, bankers, and debt marketers reach allocation limits. To better understand this, Terry explains that, especially with commercial real estate, the big building projects are launched during a healthy economic phase. But since these ventures can take up to or more than two years to complete, the economy could be back to a negative position, where few developers would risk beginning something new.Based on the shifting demographics of the millennial population growing at about the same rate as that of baby boomers retiring, Terry offers this optimistic prediction: “There's going to be continued growth in the multifamily and growth in the boomer-focused housing, offering medical facilities, assisted living facilities.”Although Terry often says that all real estate is local, it’s important to remember that world events from afar can have consequences in our own back yard.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Roundup.  This is the time every single week we get together with noted real estate agent Terry Story. Terry is a 27-year veteran with Coldwell Banker located in sunny Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: The news has been and continues to be is this vote by the British Union to get the heck out of the European Union, and we're wondering what effect might that have on US real estate.Terry Story: Steve, in the short term, the US could be flooded with investors flocking to the US as a safe haven, putting more demand on real estate, and, of course, that would be a good thing for us.  While there's a rise in the dollar, it could hurt US exports.  It's also expected to put downward pressure on the long-term mortgage interest rate.  It's going to be two-fold.  One, long-term interest rates; two, investors leaving some of their investments in London, specifically, and moving to the US.Steve Pomeranz: When you have stress times like these, the big money, institutional money, and pension money has to go somewhere, and if it seeks safety, there's only a limited few areas they can invest in.  The most liquid area in the world to invest in for big dollars is US Treasuries, so if there's more demand for those bonds, then prices rise, which means the corresponding interest rates fall, and then if interest rates fall, mortgage rates, which are pegged to treasury rates, will also fall.

Brexit: How To Remain Calm And Carry On

The news is out! We all now know that Britain has voted to leave the European Union. Is this a big event? You betcha! And it’s going to change a lot of things.But, first, let’s take a step back and remember how we arrived at this point. If you were brought up in the 20th century, you know that the European continent has been witness to countless wars and horrific bloodshed during the 19th century and before. So after experiencing two devastating world wars, a movement began to unite the continent through trade and institutions, which, in effect, would enable free trade laws, freedom of movement, and the reduction of barriers—all managed by technocrats and bureaucrats rather than by nationalist parties competing for resources and wealth through open conflict and misery.What has followed have been six decades of integration and the fostering of cooperation between neighboring states instead of war and pestilence and misery.So one can say that, in the effort to serve the goals of peace and collaboration, the European experiment has been a resounding success— and a remarkable achievement. “Six decades ago, the Continent was at war; and three decades later, it was divided by the Iron Curtain and haunted by the threat of nuclear war. Today, one can rent a car in Portugal and drive all the way to Estonia without facing any border controls. EU citizens can study, work, and retire anywhere they want in the Continent”. So writes Stratfor Global.It’s important to note that Britain’s role from the start has been conflicted. And according to the research company Stratfor Global, “Britain has been maintaining some distance from the Continent as a key part of its national strategy since the beginning. London has been skeptical of the European project from its inception, interested more in the bloc's common market than in any federal aspirations.”These feelings have been nascent and a great deal of Euro-scepticism has been present, as I said, from the very beginning.So, importantly, this vote to “Leave” has crystallized the concern that attempts to centralize the European bloc may be doing member states more harm than good and that, to varying degrees, the feeling is that countries may be losing their identities and control of their own destinies.Whether this is actually true is cause for much debate. But, nevertheless, it has fostered some feelings of xenophobia and rumblings from other nationalist parties, which is a movement, in my opinion, toward darker times once again.Perhaps it is correct that individual states have lost some control over their own destinies and that restoring rights that these countries should not have lost in the first place is a positive step, which could explain why the European Union is losing the battle for its citizens’ hearts and minds. Perhaps the European Union is at once too centralized and not centralized enough, and this middle ground is becoming increasingly untenable.Okay, let’s talk right now about what this means to US investors.Up until this vote, stocks were vacillating significantly. If the vote leaned toward “Leave”, the market went down 150 points. If it tilted toward “Remain”, it would jump 200 points, and, as a matter of fact, the night of the vote the US market increased by 230 points.Now that the “Leave” vote has been cast, the markets are wildly gyrating to the down- side.Are there serious implications for the US? The answer is yes but not nearly as much as the repercussions Britain may feel when things begin to settle out.Our Federal Reserve Chair Janet Yellen recently stated that a British exit from the EU "could have consequences in turn for the U.S. economic outlook."Stocks will decline as uncertainty mounts and the future becomes cloudier.

Too Busy? Here’s Brexit In 15 Minutes

With Mohamed El-Erian, Bloomberg View columnist, Chief Economic Advisor at Allianz and is Chairman of President Obama's Global Development Counsel, and Author of The Only Game in Town: Central Banks, Instability, and Avoiding the Next Collapse  Making sense out of Great Britain’s decision to divorce itself from the European Union is a job for a highly-qualified expert. Mohamed El-Erian, author, Bloomberg View columnist, Chief Economic Advisor at Allianz, and Chairman of President Obama's Global Development Counsel, is such an expert.Mohamed foreshadowed the chaos caused by Brexit in his latest book The Only Game in Town: Central Banks, Instability, and Avoiding the Next Collapse, which was the subject of a compelling interview here at On The Money Radio last February. At the time, he spoke of the T-junction, that point in the road where you come to an intersection and must choose between following two dramatically different roads. Because of Brexit and other disruptive factors in our world economies and societies, Mohamed warns that we are now approaching that T junction, the end of the road, so to speak, and political choices will greatly affect the order of the world going forward.How Brexit became the improbable that turned into a reality is best explained by going back to the beginning of Britain’s entry into the European Union. Unlike most of the other member countries who welcomed the opportunity to participate in a free trade zone and enjoy close economic, financial, social, and political ties, Great Britain viewed the EU mainly as a super free trade zone. Instead, they were held to regulations and requirements they found difficult to swallow, including those concerning immigration and open borders.The political arena that ensued involved a Prime Minister, David Cameron, and his Conservative Party whose stability was threatened by the UKIP, the United Kingdom Independence Party, a fringe party much like the Tea Party branch of our Republican party, whose main goal was to exit from the EU. In order to win re-election, Cameron promised a referendum if he was unable to achieve certain concessions from his European partners. Apparently, the UKIP was not appeased, the referendum took place, and, to the surprise of even those who voted for it, Brexit ruled the day. And now what does remain is a mess.Because this is such a singular world event, with no playbook to refer to, no one knows precisely what comes next. The ball is up in the air and how it all settles, Mohamed says, depends on the political choices made in the near future, not just in England or in the rest of Europe, but in the United States, as well.Politics greatly affects the economy and the shock waves from something like Brexit create what Mohamed calls “unusual uncertainty”. Investment wise, so many factors are in play at one time that investors cannot differentiate between the good and the bad. With plenty of cash to invest, this could be a perfect time to pick up good names that are trading cheaply. Mohamed defines good names as those companies or countries with strong balance sheets, positive cash flow, and good management.As for broad-based index funds or passive investments, the appeal is low fees, but part of the danger lies in passive funds being part of the index. Mohamed offers the example of Argentina which defaulted in 2001 and was 22% of the index.

Can You Really Buy A House With Only 3% Down?

With Terry Story, 27-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLNo one is going to get excited about 3% discount on a $10 movie ticket, but to buy a house with only a 3% down payment on a $250,000 mortgage could be cause for a big celebration.Up until now, a 3% down payment on a home mortgage was only available with FHA loans and, even at that, the cost of the required mortgage insurance had gotten quite high. Recently, major lenders, such as JP Morgan Chase, Wells Fargo, and Bank of America, began offering their own version of 3% down mortgages which do not require the applicant to buy mortgage insurance. (A minimum credit score, somewhere 620 and 660, is a requirement, however.) Some of the thinking behind these large institutions easing up on mortgage requirements boils down to their desire to create lifelong customers who will be buying and utilizing other banking products in the future.These new home mortgage products are quite attractive for the young first-time home buyer who typically could not come up with the higher percentage down-payment.Terry’s Real Estate Survival Guide section this week addresses the importance of the seller’s property disclosure. Your real estate agent requires the seller to fill out a list informing the buyer as to what may be wrong with any part of the house, such as a faulty air conditioner or a sometime water leak in the attic. This disclosure does not obligate the seller to repair or replace anything, it simply allows the buyer to either negotiate for repairs or to accept the property as is. Not complying with this requirement can result in legal action against the seller after the sale, so it’s best to pay heed.Terry says she’s frequently asked about the most solid or the best property investments, which presently in our South Florida area are:* Senior housing* Student housing* Warehouses* Neighborhood strip malls* Self-storageFrom changes in mortgage requirements to finding the most desirable neighborhood for your needs and everything in-between, Terry Story always has her finger on the latest trends in the real estate market.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Roundup with Terry Story. Terry is a 27-year veteran with Coldwell Banker located in sunny Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: I've heard now that the 3% down payment for a mortgage is getting to be quite of a regular thing.  Are banks aggressively marketing these?Terry Story: They are.  Usually they were through the Federal Housing Administration, FHA, loans.  They're great programs, 3% down, but what's happened is the cost to do these mortgages has gotten really high.  You're required to have mortgage insurance and the cost of mortgage insurance has gone up.  Lenders such as JPMorgan Chase, Wells Fargo, and some other lenders, Bank of America, are now offering their own version of the 3% down, and in some cases, they're not requiring any mortgage insurance.  In essence, what's happening, Steve, you're basically getting the same product at less cost.  For example, with Wells Fargo's program, you can get down payment assistance from the form of gifts or community assistance programs.Steve Pomeranz: They don't care how you get the money.  They used to care, but you're saying they don't really care anymore how you get the money.  They must have some other requirements.  It must be tougher to get those mortgages.Terry Story: Yeah.  You're going to have to have certain credit scores.  Wells Fargo wants a minimum of 620.  They're going to have some requirements.  The thought behind all of this, Steve,

Does The Federal Reserve Really Know What They’re Doing?

With Danielle Marceau, Senior Economist with PrevedereIf you’re going to the beach and you want to know if it’s going to be sunshine or storm clouds, you could check grandma’s arthritic knees, pick up a divining rod, or maybe call Al Roker. When it comes to forecasting the economy, however, you’ll want a more scientific approach.Danielle Marceau is a senior economist at Prevedere, where economic growth is predicted by identifying leading indicators and coming up with algorithms that have produced results with more than 85% accuracy. Prevedere defines their method as a “statistical combination of multiple leading macroeconomic trends, creating a single line representing the future momentum of the industry.”Danielle says that the Federal Reserve, in contrast to the philosophy behind Prevedere, uses a reactionary method to measure economic growth, one based on the current state of the economy and not necessarily on looking into the future. An example of the disparity between the two systems concerns the employment numbers that just came out in May. The Fed had predicted the number of jobs added to be around 160,000, when, in reality, they came in at 38,000. Prevedere had actually predicted a lower number of new jobs based on their indicators, which included, for instance, the fact that corporate profits, small business confidence, and industrial production were all calling for weaker jobs growth.It’s important to note, Danielle points out, that in spite of the slow growth we’re currently experiencing, we’re not looking at a contraction, a pulling back, but instead a period of deceleration, a softness in the economy.Even factoring in for the uncertainty caused by Brexit, none of the leading indicators are foreshadowing an imminent recession in the US because of Great Britain’s divorce proceedings from the European Union.This optimism is partly due to Prevedere’s industry outlook scores, health scores, as it were, that measure the health of certain industries trending in a positive direction, which they refer to as B  to C industries—business to consumer—which include healthcare,  technology, retail  packaged goods, and the auto industry, all consumer-end focused industries which have scored positively. Based on their data, the US economy doesn’t seem to be particularly vulnerable to the global fallout incurred by Brexit.Brexit, however, has undoubtedly rattled the stability of the world economy and volatility will probably be with us for the foreseeable future. According to Prevedere’s calculations, the economic forecast may not promise all blue skies and sunshine, but neither does it point to stormy weather.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: There's a lot of talk these days about the fact that the Fed keeps predicting or keep making bad predictions about the US economy as they try to adjust interest rates to either speed up or slow down economic growth.  My guest, Danielle Marceau, is a senior economist at Prevedere.  She's an expert of forecasting growth and the growth and contraction of the US economy. And their algorithm, so they write, has produced results with more than 85% accuracy.  So that truly interested me, and I wanted to get to talk to her.  Welcome to the show, Danielle.Danielle Marceau: Thanks, Steve. Thanks for having me.Steve Pomeranz: Those of us who follow policy making from the Federal Reserve, and I know you do as well, have noticed that they've talked about raising interest rates quite often, and they only really were able to raise them once, and they keep modifying their predictions on growth.  What's going on there?Danielle Marceau: Yes, I believe and what I've seen is that, really, they missed their opportunity to get the raise in that they had expected or wanted to get in.

Extra! Extra! Get Your Housing Market Update

With Terry Story, 26-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLWhen talking shop, Terry always counsels that all real estate is local. And so speaking of the South Florida market, one buyer’s positive is another seller’s negative.  A lack of inventory has created a sit back and enjoy the show moment for anyone with a For Sale sign in front of their house. Buyers, on the other hand, find themselves in a state of frustration with higher prices and heavy competition for a few desirable properties.When it comes to the choice of either buying or renting today, Terry cites the Case-Shiller Home Price Index as showing that in some metro areas, such as Boston and New York, it’s better to buy, whereas, in Dallas and Denver, renting seems to be the smarter way to go for the moment. Again, it all depends on your location.As for the luxury market (over $2.2 million), there’s been a decline both globally and nationally.  Even in Dubai, that area of glitz and extreme wealth, housing prices have tumbled by about 25% because of falling oil prices.From the large and luxurious to the extreme opposite side of the housing scale are tiny homes, those of about 400 square feet.  These Lilliputian dwellings are a rising and growing trend appealing to students, millennials, and retirees.For today’s slice of her Real Estate Survival Guide, Terry talks about a term known as “procuring cause”, which is the series of events taking place with a client that determines if the realtor is entitled to a commission on a sale. This often happens when a home seeker works with multiple realtors. Besides often resulting in an ugly situation that has to be arbitrated through local real estate boards, using more than one realtor is not a smart move for the buyer since, especially in the same community, all realtors have access to the same properties.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Round Up.  This is the time every single week we get together with noted real estate agent Terry Story. Terry is a 27-year veteran with Coldwell Banker, located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: Hey, Terry, are sellers happy these days?  Are buyers happy?  Who is happy?Terry Story: Who is happy?  Happy, happy, happy.  Right now, we have happy sellers and very frustrated buyers.  They did a recent home purchase sentiment index by Fannie Mae and, basically, the report indicates this: The homeowners are at an all-time high in their happiness as to it being a good time to sell.  On the reverse side, we have the buyers at an all-time low as their sentiment as to the market conditions.  What's causing this is lack of inventory.  Lack of inventory is driving fewer choices for buyers, prices rising, being placed into multiple bid situations.  For a seller, they're sitting back and watching the show and enjoying it.Steve Pomeranz: They're not really selling in mass, though.Terry Story: No, they're not selling in mass.  The numbers of sales, I think, are down.  I know the reason why the number of sales is down is because we don't have enough inventory.  The demand is out there.  There's plenty of buyers.  When I talk about this, Steve—real estate is local—so when I say this, this may not necessarily be true in your specific neighborhood or community.  On a national level, this is what we're seeing.Steve Pomeranz:  Terry, is it more advantageous to buy today or to rent?  We always have that discussion.Terry Story: The buy-rent battle.Steve Pomeranz: In different economies, in different locations, one may be better than the other.  What do you see?Terry Story: Sure.  The Case-Shiller Home Price Index found that, nationally,

How To Kick Butt With Kickstarter And Rock Your Career

With Elizabeth Granados, Entrepreneur and Developer of Little-nomad.comAnyone who’s had a baby or who has played with a baby knows, there are times when you just have to get down on the floor, and something has to cover that floor.  Elizabeth Granados is a young mother who noticed that although play mats had taken the place of blankets, they were all of the same style foam mats in primary colors. Recognizing the need for something more tasteful and more in keeping with the living space of young families, Elizabeth developed Little Nomad, a line of beautifully illustrated printed play mats.Little Nomad is a success story for the modern entrepreneur. Elizabeth’s baby-steps from idea to product development and, ultimately, sales began with one idea for a niche market that she knew well, and her path is a lesson for anyone hoping to sell and market online. She took a thoughtful approach by first testing the market within a Facebook group of about 14,000 moms, diligently posting, interacting, and maintaining a strong presence until she knew she had something worth taking forward.Elizabeth then set up a landing page with beautiful photos of the product, announcing a sales launch date, collecting emails, and garnering interest by offering a limited number of deeply discounted play mats to her first responders.  After taking a course in crowdfunding called “From Zero to Funded” with Cathryn Lavery and with a small amount of startup capital, Elizabeth began a Kickstarter campaign by presenting the product through a professional video along with early bird incentives to the first people who signed on.The strategy behind Little Nomad is a lesson for anyone with an idea and the entrepreneurial spirit needed to see it through to a successful end.  If you would like to help fund this project, or find out more please click here.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: Elizabeth Granados is the creator and CEO of Little Nomad, a company that has just started and designed and created a new baby category—beautifully illustrated printed play mats.  Now, discussing the product isn't really the purpose of my having her on the show today, but she has done all of this, raising her now 11-month-old baby girl and has just finished a highly successful Kickstarter campaign to get her going.I saw Elizabeth's video promotion.  I was extremely impressed with the quality of the video and her message, and I want to share that with all of you, especially those of you who have great ideas and want to learn how to bring them into the marketplace.  Elizabeth is doing a fantastic job of just that.  Hey, Elizabeth. Welcome to the show.Elizabeth Granados: Hi. Thank youSteve Pomeranz: Quickly, let's talk about the product and what it actually does.Elizabeth Granados: Sure. I have an 11-month-old baby, as you said; and, before that, I had friends with babies and just seeing the traditional foam play mat with the primary colors in my friends' homes, I saw a need for something more tasteful, more beautiful, particularly for city moms who share their living area with their child's play space. So working with an illustrator, we designed a beautifully-illustrated printed play mat to fill that need.Steve Pomeranz: Very good.  A lot of people have great ideas.  They see a need, but, in your case, did the idea come first or did the idea of marketing to moms and trying to find a niche in the mom market come first?Elizabeth Granados: I'm one of those entrepren...

The 5 Pivotal Years That Set Your Financial Future

There is a constant stream of messages telling us to save, save, save for retirement. They are important messages and you should listen closely.However, there are key pivotal ages when your retirement portfolio will require hands-on attention when you’ll have to make decisions that impact your financial security and quality of life for years to come. These windows of opportunity may last as little as a few months, so listen carefully and make sure you don’t miss these five crucial ages to make your best financial progress.Money’s Penelope Wang recently penned an article which zeroed in on five key pivotal times in your life and career when you should take full advantage of windows-of-opportunity to stash away money and stay on track—and I have added some of my own ideas, as well.* Age 25: Commit to SavingWhen you’re just out of college, saving can be hard. But halfway through your twenties, with a job or two behind you, you’re psychologically and financially ready to set money aside. If you start your savings at 25, you’ll get the full effect of 40 or more years of compounding… and you’ll develop a habit that will serve you well for life.Here’s your key move for this age: Aim to put away at least 10% of your pay in your workplace plan, if you have one, or set up a Roth IRA. Most 25-year olds are also fairly computer savvy, so to keep you on-track, pick one of many free financial apps that automatically helps you track and save towards your goals. For example, an app at Acorns.com is free and diverts small amounts into your savings accounts by rounding up your debit or credit card transactions to the nearest dollar and funneling that change into an investment account.* Age 45: Turn Up the VolumeAt 45, you’re near your peak earning years, which are 48 for men and 39 for women—that’s when your salary level is at its highest and you most likely have fewer working years ahead of you than behind you, so retirement has to be a priority. This is a good time to turn up the volume on your savings and power-save. Now is also the time to not get carried away into making wasteful or over-indulgent purchases.Here’s your key move for this age: Take stock of your savings over the past 20 years. Then use online tools and retirement calculators to realistically estimate how much retirement income your portfolio will generate over the next 20 years. While forecasts aren’t perfect, they can inspire. A 2014 study out of Stanford University found that seeing such long-term estimates helped spur workers to boost their savings. For more detail and guidance, hire a qualified financial planner who can find other areas of savings and help keep you on track.* Age 60: Get Familiar with Social SecurityThe earliest you can receive Social Security, generally, is at age 62, but claiming strategies, especially for married couples, can be complicated. As I’ve mentioned before, early withdrawal from social security comes with a life-long penalty. So don’t rush to get your social security, but come up with a plan that keeps you from tapping that resource until it’s penalty-free for you, so you get its full benefit.Here are your key moves for this age: Although about 40% of all retirees claim social security at age 62, look for ways to hold off because monthly benefits grow 7% to 8% per year until you’re 70. While you wait, build up enough cash to cover emergencies and daily expenses and temporarily lower the risk of your portfolio in case a bear market rears its ugly head. Your adviser should be recommending this and a good one will know exactly what to do.* Age 65: Enroll in MedicareUnless you or your spouse is still working and you’re on an em...

Surprise! Women Are More Retirement Savvy Than Men

Adapted from the article on cnbc.com: “Women Save More Than Men Before Retirement” by Sarah O'BrienLet me ask you this: Between men and women, who do you think knows more about finance, stocks, bonds, ETFs, and other investment securities? Go ahead and take a second, think about it, and pick an answer—men or women?In most American households (including yours), who makes most or all of the decisions related to retirement savings and investments—the man or the woman??I wish I could see you all and ask for a show of hands on the answers, but this is radio, so I’ll just cut to the chase. It turns out that women rule the roost when it comes to saving for retirement. And recent research by Vanguard shows that women are the ones signing up for 401(k) plans and saving a larger piece of their salaries compared to their male counterparts. Surprised? I’m sure some of you are!Data from the Vanguard Center for Retirement Research shows that women save more than men before retirement, yet men have more wealth because they typically earn more. The study found that women are 14 percent more likely to voluntarily take advantage of pre-tax retirement savings accounts than men and save anywhere from 7 percent to 16 percent more than men, depending on income level.The average retirement account balance across all income levels for women was $79,572 vs. $123,262 for men, but that imbalance is skewed by large differences at the high-income range, which is mostly comprised of men. But when you look at the under-$100,000 crowd, men don't beat out women's account balances.Additionally, although women generally get a bad rap for being more risk-averse than men, the Vanguard study shows that both genders allocate about the same amount of their retirement money to stocks and index funds.The study also found that more women (42 percent) than men (36 percent) use professionally managed portfolio allocations, such as target-date funds. In other words, men are more likely to cobble together their own portfolio than choose a target-date fund or similar option that would put their allocation of stocks and bonds in the hands of someone else.Similarly, many financial advisors observe that men are less likely to be long-term planners or to seek out a financial pro for help.  Compare that to the stereotype that men won't ask for directions if they are lost but women will, and the same applies when it comes to asking for financial advice. Men seem to think they should know everything that's going on in the financial world, but we need to break that mindset.  So all my male listeners, going forward, please don't be embarrassed to ask for advice. It’s not a sign of weakness; it’s actually a sign that you’re smart.Women tend to plan much more for the long term and are on the right track from the very beginning. But with men, it’s only when there’s an immediate need—like if they are close to retirement—that they usually seek advice.But it’s not all bad news for men. A study from the Global Financial Literacy Excellence Center showed that while both men and women  scored poorly on a three-question financial literacy quiz, men did better. Just 22 percent of the women surveyed for the study answered all three questions correctly, compared with 38 percent of men acing the quiz. But men were more confident about their financial knowledge than they should be. And even when they were wrong, they reported being “very confident” about their answers. Women, in contrast, were more likely to admit when they were unsure of the answer.In other words, women, generally speaking, can ask for directions when they're lost and, it appears, also ask for financial advice. (As an aside, I have to admit that I hate asking for directions but force myself to do it anyway...

Is There A Pot Of Gold At The End Of The Marijuana Rainbow?

With Jeffrey M. Zucker, Entrepreneur and Co-Founder of Green Lion PartnersWith regulated cannabis now legal in 24 states and in the District of Columbia, the industry is moving out of the shadows and into the above-ground economy. Jeffrey M. Zucker, along with his involvement in various entrepreneurial ventures, is the co-founder of the leading cannabis industry firm Green Lion Partners.This fairly rapid level of acceptance of cannabis can be attributed to several factors including the value it has brought to the economy and to the medical world. This acceptance, in turn, has spawned a host of new companies, such as growers, sellers, and cultivators who are facing the challenges of working with a product that’s still against Federal law. Probably the largest hurdle for those who actually touch the plant itself concerns banking. What do you do with all that cash?There’s a solution for most problems and, in this case, software firms such as Flowhub, compliance companies such as Metric, and security services which transport money to safe locations are stepping in to circumvent some of the obstacles.Jeffrey and his colleagues and partners in the business of cannabis are presenting the argument that a safe and regulated system would work to the benefit of all concerned.  At this point, marijuana is still a Class One drug, along with heroin, LSD, and cocaine, drugs with highly addictive and abusive potential. Marijuana doesn’t fit into that category and, in addition, has an incredible number of medical uses. A movement is presently underway to either have cannabis classified as a Class 2 drug or— which is the hope for the future—to have it declassified altogether.A Facebook site called Mass Roots is stepping in where traditional methods of running a business normally would function. Mass Roots began as simply a social network for cannabis users and aficionados but has now grown into a platform for cannabis-related businesses to advertise directly. Although not yet on the NASDAQ, Mass Roots is listed on the Bulletin Board with a stock price of about 80 cents.With more and more states legalizing marijuana, the full potential of the cannabis industry will grow along with the general acceptance on a national level.  In the meantime, Jeffrey Zucker deals with the complexities of navigating the restrictions and prohibitions of a successful industry hopping and skipping its way to the mainstream of the business world.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: I don't partake in the use of cannabis, but I am interested in how its wider acceptance and emerging legality is moving out of the shadows and into the above-ground economy.  I've conducted a few interviews on this subject already, but a newer wrinkle has come to my attention and I want to discuss it right now.  My guest is Jeffrey M.  Zucker, he co-founded the leading cannabis industry firm Green Lion Partners and runs a portfolio of Angel Investments, as well.  Hey, Jeffrey, welcome to the show.Jeffrey Zucker: Thanks for having me.  Glad to be here.Steve Pomeranz: Let's begin broadly and hone into the main subject today.  I think cannabis is now legal in 24 states, plus DC?  If so, what's the pace of adoption by new states at this juncture?Jeffrey Zucker: That's a great question.  We're really excited for this year, 2016.  Cannabis legislation could be on up to 7 or 8 ballots at this point.  It's been pretty fast-moving, for the most part.  In the acceptance, in terms of the industry, it’s really gaining traction, I'd say throughout the United States, as people see the kind of help that it can bring to both people's health as well as the economy.Steve Pomeranz: I'm sure there's a whole bunch of industries that have s...

The New Fiduciary Rule Will Bring Your 401(k) Into The Light

With Douglas Harbrecht, Director of New Media at Kiplinger.comBecause not all financial advisors operate under the same ethical standards as a fiduciary, the Department of Labor has proposed to Congress a new set of regulations designed to protect the investor saving for retirement.Doug Harbrecht, Director of New Media at Kiplinger.com, wants every investor to understand the importance of vetting his or her financial advisor since this is the person who stewards your money and has your retirement future in his hands. The Department of Labor, Doug says, may face heavy opposition in Congress over these proposed rules because, if passed, every financial professional will be held to the same standards as a fiduciary. The important distinction is that a fiduciary is required to operate solely in the client’s best interest and not, as is often the case with non-fiduciary advisors, to garner the most commissions by pushing products that are just okay, that are suitable, but not the best options for the client. The intention is to eliminate the salesperson aspect of the financial industry.Whether or not the Department of Labor is successful in its endeavor, Doug encourages every investor to be pro-active in selecting a financial advisor by asking the question, “Are you a fiduciary, a registered investment advisor?”  If the answer is no or if you get a rope-a-dope response, move on.Many financial advisors who are fiduciaries work on a fee-only basis and, in addition, will tend to put you into a balanced program designed solely to meet your retirement goals.The importance of having a trusted and open relationship with your financial advisor cannot be over-stated. It’s your hard-earned money, and you deserve the most financially rewarding and secure retirement available to you.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: New rules abound designed to help the investor.  That's the headline you are seeing more of if you pay any attention to the investment world.  What are the rules and how do they protect you?  With me is Doug Harbrecht, Media Director at Kiplinger.com.  Hey, Doug, welcome to the show.Doug Harbrecht: Hey, Steve.  Nice to be here.Steve Pomeranz: The Department of Labor aims to keep bad investments out of people's retirement accounts.  How do they propose to do this?Doug Harbrecht: They're raising the bar on investment advice that is provided to retirement savers, not all savers and not all Americans, but those who are saving money for retirement.  Basically, this new rule would say that, essentially, anyone providing investment advice on a retirement account for compensation—for fees or commissions or whatever—they must act as what's called a fiduciary.  I know that word may put people to sleep but what it means, in essence, is that the advisor has to put the investor's interests first, ahead of his or her own, that the saver's interest come first.  What that differentiates it from is that for brokers who just try to sell you a product, whether it be an insurance product or whatever and they only have to make sure that it's suitable to your needs.  They don't have to be looking out for you. They just have to make sure that it's suitable for your needs.Steve Pomeranz: If someone recommends something that may pay them a higher commission, it still might be suitable to their needs, but it's not really under the fiduciary standard where your needs and future come first. So it's a much broader definition, and I would say to our listeners here that anyone who is using investment advice or looking to seek investment advice should know the difference and should know the term fiduciary because that is a much highe...

A Lesson From Prince: Don’t Forget To Exert Your Will

As most of you know, the much-loved singer, songwriter Prince died recently of unnatural causes at the age of 58. He was a musical innovator best known for his eclectic work, flamboyant stage presence, extravagant dress and makeup, and wide vocal range. Prince sold over 100 million records worldwide, making him one of the best-selling artists of all time.But with the mourning over his death barely over, bickering has already begun over Prince’s estimated $200-300 million estate and $500 million back-catalogue. Prince died with no known will — so his sister, Tyka Nelson, and five remaining half-siblings will likely inherit his fortune under Minnesota state law. But whatever the final result, squabbling over the millions promises to be a drawn-out process.BBC ran an article written by Kate Ashford, which spells out a lot of the ramifications of contesting a will and other aspects of wealth transfer after death; so, as I always like to do, we take a recent celebrity’s death to educate you about your money.Here’s a true story: A mother and father own a farm and have four children. Only one of the children, let’s call him Michael, works on this farm. He does so for 40 years for little pay, keeping it afloat, while the other three children have successful careers elsewhere. In their estate documents, the parents stated that when they die, the family farm should go to Michael and the family home should go to the other three siblings.Unfortunately, the parents also added a paragraph that said, “These are the arrangements to be carried out unless the children vote to change it.” Now, after the parents’ death, the other three siblings outvoted Michael and are each suing for a quarter of the value of the entire farm. If they win, the farm will be liquidated, leaving Michael with only a quarter of the value of the operation at age 60.This is the situation facing a financial planner in the State of Virginia who says: “There is no question what the parents’ intentions were, but the siblings are still taking Michael to court. They no longer speak to each other. They all think Michael is being greedy. They will lose the court battle but the family may never heal.”Contesting a will is a gut-wrenching process and could potentially be avoided if more families talked about estate planning in advance. Despite the many obvious benefits of estate planning, three-quarters of all wealthy families in the U.S. don’t discuss money and inheritance ahead of time, in ways that avoid misunderstandings and unintended consequences after they’re gone.There’s usually also a lot of animosity that develops over the years and makes wills that much more contentious. The war extends beyond the will into settling decades of simmering tensions.So if you’re in a situation where you’re faced with contesting a will, make sure you have good reasons and a fair amount of stamina because disputing a will isn’t easy.Here’s what you should know:What it will take: You’ll need to provide an acceptable legal argument for invalidating the will. You’ll also need the resources to pay a lawyer who specializes in estate litigation —which can cost tens of thousands—and the confidence to go up against your family if circumstances warrant it. So given how disputing a will can be a difficult, emotional, and expensive process, make sure you know what you’re getting into ahead of time.Depending on where you live, you may also need to have “standing” to contest a will. To have standing, you’d need to have been in-line to inherit even if there had been no will. When there's no estate document, the rules of intestacy apply, which are the state or country laws that apply to the transfer of an estate after a death. Typical intestacy rules might pass property to a spouse first, children second, parents third, and so on,

A Reasonable Prediction About This Year’s Stock Market

After a shaky start to the year with markets down in January and the first 10 days of February stocks have rebounded nicely. And the S&P 500 index has made it back into positive territory—up!—about 1.5% or so year-to-date, but still down from this time last year.With first quarter earnings mostly in (and disappointing results from many large retailers), many are now questioning the strength of consumer spending. But economic data from last week showed that it’s not all bad news on the consumer front because April’s retail sales figures showed a 1.3% increase, which was notably higher than expectations. Likewise, the latest reading of consumer sentiment rose from 89 in April to 95.8 in May, its highest level in 11 months. So economic data suggests that the consumer sector remains fairly healthy despite first-quarter earnings struggles at major retailers and energy companies. And with consumer spending driving two-thirds of our economy, things don’t look too bad going forward.In addition to bullish trends in consumer spending, there are other reasons to be optimistic about the economy and the stock market.So let’s look at the pros and cons as Bob Doll sees them. Bob is a well-respected industry veteran and is Chief Equity Strategist with Nuveen Asset Management.On the positive side:* Equity values—stock prices relative to earnings—do not appear to be stretched. In other words, stock valuations, for the most part, are fairly in line with corporate earnings. And because valuations are reasonable, we’re unlikely to see sharp corrections associated with stock bubbles. I agree with that.* Earnings improvements should start to materialize in the coming quarters. The first quarter is often seasonal, impacted by a wait-and-see attitude by corporate executives before they make large capital spending decisions, and is where winter weather often plays a role in economic growth and earnings. But with positive economic data beginning to flow in and with strengthening consumer fundamentals, corporate spending and earnings should start to look up in the coming quarters.* The oil rout appears to be over. Remember how oil prices kept falling down to about $26 per barrel just three months ago in early February? Well, prices have almost doubled since then and crude is now close to the $50 level, at a six-month high, and that’s been a major boon pulling the beleaguered oil and gas industry out of a dangerous slump that severely impacted stock market sentiment, capital investment, and jobs earlier in the year. And the good news is that with oil back up again, the markets too have gotten out of their February slump.* Investor sentiment may be overly bearish, and I can tell you that almost everyone who walks in my door is bearish and waiting for some major bad thing to happen. And this ties into my earlier point: That equity valuations do not appear to be stretched and, in some cases, shares of good solid companies are trading at enticing discounts. Case in point, over the past few months, one of Buffett’s two major money managers within Berkshire Hathaway has built-up a $1 billion position in Apple stock, which was hurt by overly bearish sentiment to the point where those managers at Berkshire saw good value.* Bob thinks corporate tax reform prospects for next year appear bright, so that too should boost corporate sentiment and spending…which, in turn, translates into more jobs, higher wages, better consumer sentiment, and economic growth. How he can tell this based on the current presidential candidates’ statements is a mystery to me, so we will see how this plays out.But as I stated in one of my earlier commentaries, with the stock market there are always risks, as one type of risk rotates out and another rotates in to take its place.The negatives include:* The fact that Q1 earnings were shaky means investors are now taking a wait-...

Hey, Baby Boomers!  Marketers Still Put You First!

With Jaana Remes, Economist and Partner at McKinsey Global InstituteWe live in a rapidly changing world with global and technology influences and innovations becoming passe before they even get a chance to become the norm. In fact, the norm is a term that is becoming passe by definition.Jaana Remes, a partner at the McKinsey Global Institute, says we are in a time of great flux regarding consumer spending around the world and, in particular, in our own national backyard.The results of a recent McKinsey comprehensive survey revealed the three major groups that will be shaping future global consumption:* The aging and retirement of the developed world* China’s working-age consumers raised in post-reform China* Working-age consumers in the US, the so-called millennialsThe surprising takeaway from the study of this survey is that companies are focusing more and more of their advertising and promotion on the first group, the aging and retiring baby boomers, who will account for a much larger percentage of consumer spending than the present working-age population.Even in the housing market, nearly half of all renovations are done by the over 55 group who, instead of downsizing or relocating to “Golden Pond” communities, are aging in place, in their present homes.This shift away from the glorification and pandering to the youth market on behalf of companies can be attributed to the reality that many millennials and even Gen Xers are struggling financially. Unlike the boomers who came of age during a relatively simple and economically predictable time, millennials had to launch their careers during the difficult period of the last eight years and most of them may never reach the level of success of their parents’ generation.Jaana also points out that this growing older generation, the over-60s with an ever-increasing life expectancy, will be different from those in the past due to several factors. One is an inequality between those being financially secure and those who are not, since this is the first generation that has had to be proactive about setting up retirement funds.  In the housing sector, there will be more multi-generational housing based on ethnic diversity but also more single households due to the high divorce rate among boomers.The full extent of the findings of the McKinsey survey can be found at mckinsey.com.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: You know I'm always reporting and discussing this vast changing economy and this fast changing world of money.  Recently, I had Steve Case, the founder of AOL on the show.  He made the case for a 3rd wave of the internet, describing how the pace of change is accelerating from the old economy to the new.  There's some new information around, as far as the way consumers are spending and as the world changes and ages.  To this effect, I'll ask my next guest, Jaana Remes, to join us. Jaana is a McKinsey Global Institute Partner.  She's going to discuss a survey that they did, a comprehensive survey, which captured the real state of consumers spending trends. Welcome to the show.Jaana Remes: Thank you so much, Steve, for having me.Steve Pomeranz: First, tell us about this survey.  Give us a good idea of what you guys did.Jaana Remes: We are in one of those moments, indeed, as you said, where things are changing.  We have had China's investment boom of the last 15 years come to a slow end.  It's time for us to start thinking where the next wave of growth is going to come from.  It really will have to come from consumers who are going to be the next wave of global growth.  When we started to reflect on that, where exactly the consumers will be who will have the numbe...

Slash Your Tax Bill Now!

With Phil DeMuth, Managing Director at Conservative Wealth Management and author of The Overtaxed Investor: Slash Your Tax Bill and Be a Tax Alpha DogWhen it comes to figuring out the tax code, most of us meander between Confusion Lane and Anxiety Road. You want to pay the legal amount but not a penny more, so how can you arrive within that safety zone?Phil DeMuth addresses this conundrum in his new book, The Overtaxed Investor: Slash Your Tax Bill and Be a Tax Alpha Dog, an especially important read if you’re an investor in a high-bracket watching the earnings from your portfolio being poured out each year into the coffers of the tax authorities.A California resident in this group, for example, could be looking at 33% of all earnings from dividends and capital gains going to the state and federal governments, a sure roadblock to building wealth. As a counter-measure, Phil advises that all dividends, stocks, taxable funds, everything which is tax-intensive, be held in tax-qualified accounts such as 401ks or IRAs and to steer clear of mutual funds that pay dividends and incur capital gains.And if you are invested in high-dividend stocks, make sure to house them inside a tax-qualified account, like an IRA.For those approaching retirement, you want to avoid finding yourself in a higher tax bracket because you’ve saved diligently and socked away a large portion of your income into a large IRA which requires you to begin taking distributions each year according to the government’s life expectancy schedule.  Phil says that somewhere before retirement, perhaps in your 60s, it would be smart to convert some of your IRA to a Roth IRA, transferring only an amount that puts you in a more reasonable tax bracket.When it comes to taxes, avoidance doesn’t pay, but a well-thought out strategy to keeping your hard-earned money working well for you into retirement does.  Phil DeMuth’s entertaining book, The Overtaxed Investor: Slash Your Tax Bill and Be a Tax Alpha Dog, can help steer you away from your tax code worries.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: Who understands the entire tax code?  The answer is no one.  No one understands this tax code.  Finding your tax rate is like shooting a ball into a pinball machine.  You watch it getting slingshot around the board lighting lights, buzzing buzzers, and ringing bells, until the end when you look up at the game board and you find out what you owe.  Well, that's craziness.  How do you get this craziness under control, so you end up paying the legal amount due in your taxes but not a penny more?  Well, my next guest, Phil DeMuth, answers that question for us in his new book

The Perils of Home Purchasing Every Buyer Should Know

With Terry Story, 26-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLAs a longtime real estate agent, Terry Story has encountered many complications along the way from the first showing to the handing over of the keys. It has happened, she says, that just before the deal is inked, the seller is gripped with buyer’s remorse and backs out. Where’s the recourse for the buyer?Unfortunately, sometimes the only answer lies with the courts, but suing can be expensive, time-consuming, and often not rewarding for the buyer. Terry’s advice is to simply turn away and begin a new home search, as heartbreaking as that may be.As part of Terry’s Real Estate Survival Guide, she encourages buyers to comply with a code of house-seeking etiquette. Realizing that the owners have staged their homes so they show in the best possible way and then have to vacate for the duration of the prospective buyer’s visit, buyers should always show respect and restraint toward another person’s property. Don’t come with an army of friends and relatives, don’t allow children to run helter-skelter through the rooms, don’t move objects around, and don’t leave fingerprints on windows. The homeowner may be recording your visit on a hidden camera, and so your performance could derail or negatively influence the buyer’s desire to purchase that home.Terry tells all buyers to pretend they’re walking into the White House and to act accordingly.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Roundup.  This is the time every single week we get together with noted real estate agent, Terry Story. Terry is a 26-year veteran with Coldwell Banker located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: Well, you know I always like for us to do our Real Estate Survival Guide, and this is the time in the show that we try to put in every single week where there's a problem that springs up or a tip that you can give to our listeners about real estate.  What is it this week?Terry Story: Well, this week it's about buyer's remorse and buyers wanting to get out of contracts, and they have so many outs through their inspection clause, through their mortgage, but what happens when a seller gets seller's remorse and they want to back out of a contract?Steve Pomeranz: What happens?Terry Story: Basically, it's this.  Sellers, sometimes it happens, not very often, where they want to get out of the deal.  You, as a buyer, don't want that to happen, so the only way you're going to be able to realistically deal with this in a practical sense is you're going to have to sue them.  What are you suing them for?  Specific performance.Steve Pomeranz: Before you go on, let me read the actual question because I think it's a well-written question:  "We found a house and entered into a contract to buy it.  We did our inspections, got our mortgage loans set up, and are ready for the closing about three weeks from now.  Last night, the seller called and told us that she had an unexpected issue and will not be able to sell us the house.  Don't we have rights here?  Do we have to wait until the closing date comes and goes before we can start taking action to enforce the contract?"That is the situation.  You've put all this effort and time and your heart into buying this new home and seller pulls out at the very last minute.  You feel like, "Heck, I deserve some redress here."Terry Story: Yes.  The first thing you have to do is hire an attorney.  That's the absolute first thing you need to do, and there are some provisions to try to prevent this from happening, and one of them, Steve, you know the commission…if a realtor is involved and...

Would You Bet A Million Bucks Against Warren Buffett?

Have you heard about the $1 million dollar bet Warren Buffett made with a famous hedge fund manager? The bet was: Could a group of hedge funds, professionally selected, beat an index fund over a 10-year period?The hedge fund manager, Ted Seides, accepted Buffett’s challenge and picked a group of five hedge funds that he expected would collectively outperform an index fund chosen by Buffett. The winner would get $1 million donated to a charity of his choice. Each man put $320,000 in bonds (for a total of $640,000) that was supposed to mature to $1 million by 2018. (By the way, if you’re wondering what the rate of return is that will grow your money from $640,000 to $1 Million in 10 years, it’s 4.51%.)Buffett picked the low-cost Vanguard 500 Index Fund Admiral Shares (VFIAX) which is based on the S&P 500 index, but the names of the hedge funds were never publicly released to protect their reputations.And, so far, Warren Buffett is winning big. His index fund was up nearly 66% from the time the bet began in 2008 until the end of 2015, a return of about three times that of the funds chosen by Seides, despite the fact that the index underperformed the hedge funds last year.Thanks to an article about this on Yahoo Finance by Lawrence Lewitinn, there are a number of quotes by Wall Street legend, John Bogle, founder of the Vanguard Group and pioneer of index funds. Bogle was interviewed about this and said Buffett “is a believer” that hedge funds can’t beat the market over time. Bogle said of Buffett, “He's been talking about indexing and the S&P 500 since before I ever met him.” In fact, Buffett believes in index funds so much that he has set up a trust for his wife's estate and has directed that 90% of it be invested in a low-cost S&P 500 index fund.Referring to this bet, Bogle said Ted Seides made a big mistake when choosing his hedge fund managers. And that mistake is one of the things working in Buffett’s favor in the bet. You see, Seides chose a basket of five funds. Seides chose to hedge his bet a little by attempting a little bit of diversification, to cut down his risk. Bogle thinks he might have actually done better if he had put all his money into one or two high-flyers.A single hedge fund can do just about anything. When you get five of them together, they're going to more or less average each other out. And hedge funds have not done very well for the past seven or eight years. There are a lot of very smart, very aggressive people in the Hedge Fund business because it is extremely lucrative if you’re successful.And since there is such a high level of competition, it’s hard coming out on top.Bogle also warns those who pick stocks. He talks of the explosive growth of stocks such as Facebook (FB), Apple (AAPL), Netflix (NFLX), and Alphabet (GOOG, GOOGL) – the so-called “FANG” stocks – and cautions investors by saying:“More power to you if you picked them at the very beginning, but I don't know anybody who did. To look at them today, as if they're going to repeat their fantastic early record, is just extremely unwise. The trick is picking the next Google or the next Apple, all of these names that are relatively new to investing, but that is just a really hard job.He warns investors against looking back and seeing what funds or stocks did in the past because, as we all know, past performance is no guarantee of future success, and there’s a lot of what’s called reversion to the mean. The good funds tend to go down to the average, and the bad funds and stocks tend to go up to average.So here are the main takeaways. You’re almost always better off playing it safe and investing the bulk of your assets in index funds, just as Buffett wants 90% of his wife’s estate invested in index funds, which provide diversification with full exposure to U.S. equities. Invest the other 10% in a variety of other assets su...

Technology Is Changing Our Lives Faster Than We Think

With Steve Case, Co-founder and Former CEO of AOL, Author of The Third WaveThirty years after the inception of the internet as we know it, Steve Case, co-founder of AOL, has written a new book, The Third Wave: An Entrepreneur's Vision of the Future, revealing a new paradigm already set into motion that will change the way we live our daily lives.Anyone old enough to remember when you had to pay a monthly fee to get web access can understand the giant leaps forward technology has taken since that time and how dramatically the internet has changed our personal lives as well as our culture. Steve refers to this early period as The First Wave. Considering that in 1985 at the start of AOL only 3% of households were online and at the end of that period, roughly in the year 2000, that number had increased to about 51%. And that was just the beginning of The Second Wave, the time when Facebook, Twitter, Snapchat, and Google became major players in our daily lives, affecting forever the way we interact, learn, and are entertained.The Third Wave, as Steve Case describes it, will be at least— if not more—dramatic and life-changing than its predecessors and will truly give definition to the term “the internet of everything”.In developmental stage already is the driverless car which will be one component of technologically powered smart cities. Transformative changes in the field of education will alter the way our children learn and study. The standards and practices of our present health care industry (the largest industry in our country) will undergo drastic modifications on both the corporate and personal levels. In addition, large banking institutions could very well be forced to redesign themselves in order to function in a new economic climate.Of course, all of this will inevitably cause disruption in our culture. Some industries will fall along the wayside, jobs will be lost and others created, some workers will have to be re-trained, and a surge of entrepreneurship will likely occur with many people dividing their working life between two or more endeavors. Some of the nervousness seen in our current presidential election process can be attributed to these undercurrents of change already at play.Just as the world adjusted to the shifts that occurred during the Industrial Revolution in the early 19th century, so will we regain our balance and become accustomed to The Third Wave as it moves into our daily lives and changes us one innovation at a time.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: You know, there was a time when one company handled nearly half of all internet traffic and created the first significant portal into the new world of the internet.  There was a time when you'd have to pick up a free CD at the checkout line of your grocery store and pay a monthly fee in order to get access to the web.  There was a time when that company became one of the most valuable and fastest-growing companies in the history of America.The man who lead that company and is now leading the way toward a new phase of the internet revolution is here with me today.  I want to welcome Steve Case, co-founder and former CEO of AOL.  Steve, welcome to the show.Steve Case: Great to be with you.Steve Pomeranz: It's 30 years after the beginning of the internet, as we know it.  The internet has integrated into all aspects of our lives...

What Makes Prophets of Financial Doom So Smart? Not Much!

With Allan S. Roth, Founder of Wealth Logic in Colorado Springs and contributing writer at the Wall Street Journal, AARP, and Financial Planning MagazineEspecially in times of uncertainty—whether political, economic, or personal—we’re out there reading tea leaves for answers. When that uncertainty involves our financial lives, we often turn to these so-called financial gurus tossing out market predictions, some hopeful, but mostly dire. Why do we think they have some access to the unknown when in reality their crystal ball is as cloudy as our own?Allan S. Roth, Founder of Wealth Logic in Colorado Springs and contributing writer at the Wall Street Journal and AARP, has studied this phenomenon and even teaches a behavioral finance class. The answer, he says, is not in our stars or our tea leaves, for that matter, but is embedded within human natureThere is probably no area more closely tied to our emotions than money. We want to be in control and attaching to a prediction about the market gives us the false sense of steering our own destiny.  And there is no shortage of experts in the media throwing out their theories.In reality, says Roth, there are no such reliable indicators. The market will do what it will do, dependent on more factors than can be logically assessed by any financial expert.  In fact, the best piece of advice and the one most often quoted by Steve Pomeranz himself is from Warren Buffett: “Be greedy when others are fearful, and fearful when others are greedy.”Allan Roth has followed and assessed the predictions of some of the better-known market prognosticators such as Mark Yusko, Jim Cramer, and Harry Dent and concluded that in all cases, on the average, the results are even less than 50/50. If you hang in there long enough, one or two of these wild predictions may actually come to pass. But, he says, if anyone could accurately predict the market, they would be wealthy beyond the level of even Warren Buffett who built his wealth by following a steady and thoughtful investing strategy.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: Have you ever seen those ads predicting stock market doom by the so-called investment profits and gurus?  These people say they have impressive track records of accurate forecasts in the past, but the question is how do you know, and do they really?I found Allan S. Roth, he wrote an article for Financial Planning Magazine.  He also writes for CBSmoneywatch.com.  He's taken a closer look at these people, to dig more into the truth.  Let's welcome Allan Roth to the show.  Hey, Allan, welcome.Allan Roth: Thanks very much, and by the way I write for the Wall Street Journal and AARP, and haven't written for CBS for about a year now.Steve Pomeranz: I guess it's time to update your bio then, isn't it?  Okay, so Wall Street Journal, AARP, terrific.  We are all, those of us who are paying attention to the markets and investments, we're all living in an age of uncertainty, we really want to know the future.  Why are we so addicted to this idea of having to have people predict, and following these gurus?Allan Roth: It's natural to want to know the future.  I teach a behavioral finance class, and one of the exercises we go through is to show that humans can't think randomly.  We don't want to believe that we don't know the future.  We want to believe that we're in control.  The smarter the person is, by the way, the more they want to try to predict the future.  Then we look at, after stocks collapsed in '08-'09, everything was there, and we do hindsight bias and keep making that mistake over and over again.Steve Pomeranz: Everybody who—I talk to a lot of people every single day,

Still Supporting Your Adult Children? Maybe Not A Great Idea.

With Peter Dunn, columnist for USA Today and the Indy Star, Author of ten books, Comedian and Financial Expert, and Host of Pete The Planner Radio ShowThe dual careers of comedian and financial advisor may seem an unusual mix, but not to Peter Dunn. The USA Today columnist, author of ten books, and host of the popular radio show, Pete the Planner, combines the two in a surprising way.Pete recently ran a two-part series on his program about adult children still being financially supported from home and the parents who are writing the checks. This unhealthy partnership was created by a generation of parents who never raised a child who was allowed to fail or come in second and is then perpetuated by those same children who become adults who can’t stand on their own two financial feet.Often there is a failure on the part of the parents to steer their children into a field of study that offers good potential for future employment and instead letting them follow their dreams into a sector rife with job insecurity, and, on top of this, allowing them to take on a load of student loan debt they’ll be shackled with for decades to come.So how do you stop the enabling and cut through this seemingly impassable predicament? Pete advises setting a timeline for financial independence, however difficult that might be, and allowing the child to float away on his or her own, by setting a budget and perhaps even changing career goals. A harsh gaze into a future of continued codependency and its inevitable consequences should be the catalyst to set a new pattern in motion, where the result is financial security and health for both parent and child.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: My next guest is Peter Dunn, also known as Pete the Planner, an award-winning comedian and personal finance expert.  He's also a USA Today columnist and the author of ten books. He hosts a popular radio show, the Pete the Planner Show, and is a columnist for the Indie Star.  Pete the Planner, Peter Dunn.  Welcome to the show, Pete.Peter Dunn: Thanks for having me, Steve.Steve Pomeranz: Just tell me really quickly how you found yourself in this field of giving personal financial advice.Peter Dunn: I used to be a financial planner and investment advisor.  I noticed a trend in my clients that they needed more help with dealing with money and less help investing, so I was like, hey, I'm going to start teaching people how to deal with money effectively from a budgeting cash-flow perspective.  It worked so well, I ended up selling my investment practice, and now I work closely with financial advisors to fix the behaviors of their clients.Steve Pomeranz: You wrote an open letter to parents which attracted my attention, which is why I asked you to join me today.  The letter was to parents who financially support their adult children, and I found it intriguing and well thought out.  It's part of a two-part series.  The first part of the series is from the parent's point of view, and the second part of the series is from the adult child's point of view.  Take us through that a little bit.Peter Dunn: It certainly takes two to tango, and when there's a dependency issue between parents and adult children financially, both parties have culpability there.  From a parent's perspective, we love our kids so much and we don't want to see them fail or suffer, that we're willing to martyr and sacrifice our money when they are struggling.  My assertion in the column, Steve, is that you're martyring the wrong resource.  Don't martyr your money, martyr your feelings.  Let them fail.  Let them figure out that in order for their resources and their bills to match up, they're going to have to fail.

Questions Your Real Estate Agent Will Never Answer

With Terry Story, 26-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLA real estate agent is a good source of information for the home seeker, but it’s important to know where the line is drawn. Terry Story says there are certain loaded questions that you should avoid asking and that any savvy agent will avoid answering.Buyers will always want to know about the quality of the neighborhood: Is it good, is it safe, and what kind of people are on the block—questions that would require an answer that may violate discrimination laws. The agent also has to be on guard for “testers”, those people who are fishing around for infractions in this area that could jeopardize an agent’s career. Terry advises that many of these questions, such as the crime rate of an area, can be found easily on the internet.Another issue of discrimination that might occur concerns homeowner association rules.  Any alteration to existing regulations which interferes with a person’s religious practices could be viewed as discriminatory. One example of this comes from a reader in the Sun Sentinel who worried that the mandatory use of an electric key fob to gain access to his community would violate his religious beliefs on the Sabbath. In such instances, the problem would have to be solved through his HOA or condo association.So when it comes to speaking with your realtor, do some online advance research and don’t put him or her in an uncomfortable position.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Round-up.  This is the time every single week we get together with noted real estate agent, Terry Story. Terry is a 26-year veteran with Coldwell Banker located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: The life of a real estate agent.  People are always asking you questions, of course, about the home.Terry Story: Everything.Steve Pomeranz: Everything.  Everything.  However, there are certain questions that I think should not be asked of a real estate agent.  Talk to us about that.Terry Story: Sure.  You can't expect agents to answer these loaded questions, and people ask them all the time.  Is this a good neighborhood?  Is this a safe neighborhood?  Are the schools good?  What type of people live here?  Worse is when they specifically ask, can you show us a neighborhood where there's a large number of “fill in the blank”?  We have to adhere by national housing laws, the Fair Housing Act, and we can't answer these questions because of discrimination laws.  Just don't ask the agents these questions.Steve Pomeranz: Again, some of these are so subjective when someone asks you if this is a good neighborhood.  That could be a code word for something.Terry Story: It could be a code word.  For someone, it may be a code word, but it is very subjective.  What I think is a good neighborhood, Steve, and you think is a good neighborhood aren't necessarily one in the same.  It puts agents in a very funny position.  Is it a safe neighborhood?  Those are things that are easy to look up.A lot of these answers to these questions, Steve, a buyer can find out fairly easy on the internet.  We're not really allowed to direct you to what sites to go to per se, but I can tell you that a lot of the cities have their own websites that talk about crime statistics.  Certainly, you can pull up the school ratings in any of the …  just Google the names of the schools and they'll show you, in many cases, charts and graphs.  They grade the schools on a variety of categories.  If you are concerned about the schools, go visit the schools.  Learn for yourself, is this a good school for my child?The one I get all the time,

Obama’s New Rules To Protect Your 401K

For some time now, consumer advocates have been urging legislators to do more to protect consumers against excessive fees charged by a few rogue financial planners for biased financial planning advice that is often “not in the best interests of their clients”—just so these advisors can rake in higher fees and commissions—in a manner that essentially steals from their clients’ retirement contributions and fills their own pockets. Not good!After much deliberation with the financial services industry, the Obama Administration enacted new rules on April 6, 2016, to protect more Americans from being ripped off. These rules are controversial, but I think there’s some merit to them because when you’re planning for retirement, your advisor should be focused first on what makes sense for your finances, not theirs.The new rules are designed to prevent consumers from being steered toward IRAs and other retirement investments with “higher fees or lower returns” that disproportionately benefit the advisors who are recommending or selling them and are against the consumer’s best financial interest. In justifying this new legislation, the White House estimates that such conflicts of interest cost Americans $17 billion a year in lost retirement savings. The White House also estimated that the rules would save a 45-year-old worker with $100,000 in retirement savings about $37,000 over two decades before turning 65. That’s a fair amount of money for one household.But, on the downside, these rules are fairly complex and complying with them could drive up the cost of investments, making it a bit more difficult for average Americans to get retirement advice.  So let’s see how this all plays out over the next few decades.In the meantime, here are the top five things you need to know about the new rules, which will be phased in over an 8-month period beginning in April 2017: * Your nest egg takes precedent.For decades, many investment advisors have been required— under federal law—to put the best interest of their clients first. Such advisors usually earn a flat fee and are known as fiduciaries. But other retirement advisors, such as brokers and insurance agents, have been held to a lower standard and were only required to make sure investments were suitable for their clients, which is a much broader standard and quite open to interpretation. This gave brokers and agents the leeway to recommend investments that provided nice commissions and sometimes benefited the agent’s bottom line even more than the client’s.These commissions are paid by companies that offer mutual funds or other investments that can have higher fees or lower returns, benefiting the company and harming the client. And this has become a bigger issue as Americans have shifted from pension plans administered by their employer to 401K and other retirement plans that they manage themselves.So the new rules make all retirement investment advisors into fiduciaries, meaning they must put the client's best interests above their own. * The biggest impact will be on IRAs.While a 401(k) plan is administered by a fiduciary who selects and monitors the investment options available to participants in the plan, such is not the case with IRAs, which can be sold by a host of financial advisors.The conflict-of-interest is greater with IRAs. IRAs are purchased individually and have higher costs while 401K plans are run by companies that pool the investments of their employees and get better rates. So when you’re with all the other employees in a company-administered 401K, you have more buying power. To mitigate this conflict of interest, the new rules require that advisors who sell or help manage IRAs act as fiduciaries. * Financial advisors can still accept commissions… with a caveat.

How To Survive As A Real Estate Agent

With Terry Story, 26-year veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLAs a successful real estate agent for 26 years, Terry Story has come across about every scenario possible in the world of housing and those who are either wanting to get in or get out of a home, all of which has led to her Real Estate Survival Guide.In this week’s show, Terry highlights a few things important to know for both the buyer and seller, one being “the ugly house across the street.” It’s the one with the lawn gone to seed, the tiles sliding off the roof, the paint peeling off the front—the eyesore, so to speak, which affects the property value of all surrounding homes. Terry’s advice is to investigate. The home could be in foreclosure, the occupants may be renters and the owners unaware, or they could even cooperate and spruce up the place, in which case the situation is temporary. The last resort, of course, is contacting a real estate attorney.A common challenge for the agent is the home seekers who make appointments to view homes they are not yet in a position to buy. Often this is because their present home must first be sold, in which case the better avenue would be for them to do research in advance, such as looking at the many online tools and visiting open houses, before making appointments with a real estate agent and wasting their valuable time.Terry also states that home equity loans are becoming easier to obtain; hence, more home improvements mean a stronger real estate environment, and that’s good for everyone.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: It's time for Real Estate Roundup.  This is the time every single week we get together with noted real estate agent, Terry Story. Terry is a 26-year veteran with Coldwell Banker located in Boca Raton, Florida.  Welcome back to the show, Terry.Terry Story: Thanks for having me, Steve.Steve Pomeranz: We are going to talk about what we call your Real Estate Survival Guide.  Here's a question: "I've been trying to sell my home for a year with no luck.  My real estate agent tells me that it's because of the bad condition of the home next door.  It looks awful, I already have complained to the city, but nothing changed.  What can I do?" This is from Robert.  By the way, the answers from this are from Gary M. Singer, a Florida attorney who is writing for the Sun Sentinel.Terry Story: Yeah, this is a common problem.  I just had it happen a couple of weeks ago.  It was an ugly house across the way.  They had—I'll call it—lawn ornaments out front.  Just junk all around the property.  It is a problem.  What you can do is keep going back to the city.  There are code and zoning rules against this kind of thing.  If that doesn't work, maybe politely check with the owner next door, see if he's willing to do something, or if he'll help you out.  Sometimes the owners may not even live there, they're out of state, and may not realize that the tenants aren't keeping up the property.  You need to delve into it a little bit more.  When all else fails, you can put up a fence, tall hedges.  Maybe even offer to help clean up whatever the situation may be.  This does hold back homes from selling on average.Steve Pomeranz: How much? If a person walks up to your home and your home is just great, but next door is a mess and some are like some terrible artistic, eclectic collection of stuff, you got to do something.Terry Story: Right. What they say is it drops your home value by about 5 percent.  It depends on the situation next door.  Maybe it's only temporary.  Maybe it's a short sale, so eventually, it's going to get picked up or foreclosure, depending on the situation. And, if all else fails, you can always turn to a local real estate attorney to see about...

You Raised Us, Now Work With Us. – Sincerely, Millennials

with Lauren Stiller Rikleen, Expert on Strategic Leadership, Author of You Raised Us – Now Work With Us: Millennials, Career Success and Building Strong Workplace TeamsIs the workplace really a battle zone between seasoned and experienced baby boomers and the less experienced, but ambitious and self-confident millennials? Lauren Stiller Rikleen has conducted research which exposes the cultural differences largely to blame for the bad rap attributed to both sides and lays it all out in her book, You Raised Us, Now Work With Us: Millennials, Career Success, and Building Strong Work Place Teams.Millennials (those born between roughly 1978 and 2000) were raised in the technology decades and for that reason alone come into the workplace with better tech skills than the majority of boomers. In addition, boomer parents raised this generation to be self-confident as well as having given them travel and educational advantages far exceeding those of previous generations, for the most part.The stereotypical traits attributed to millennials are a sense of entitlement, lack of loyalty and commitment, as well as a lack of respect for the older worker. The boomers, on the other hand, often view these younger workmates, who appear to be aggressive and disrespectful, as vultures on the limb, waiting to swoop down and take their positions.Lauren points out that another intervening generation, the gen Xers, pushing to take on senior leadership roles, are more often a greater cause of friction with the older boomer generation who, in fact,  are sticking around and holding on to those positions longer than in the past. So while the work ethics and manners may differ between boomers and millennials, it’s actually the gen Xers creating most of the discord.Lauren writes in her book that because the cultural gap between boomers and millennials is immense, better communication and understanding is the key to a harmonious working environment.Read The Entire Transcript HereCollapse TranscriptSteve Pomeranz: The battle between generations rages on in the workplace.  Boomers say, "These kids don't have a clue what hard work is." Millennials say, "These old fogies think we're free tech support." Well, there's going to be some discussion in between and, if there is a chasm between generations, my next guest can explain it and help us to work it out.  She is Lauren Stiller Rikleen, President of the Rikleen Institute for Strategic Leadership and author of You Raised Us, Now Work With Us: Millennials, Career Success, and Building Strong Work Place Teams. Hey, Lauren, welcome to the show.Lauren Stiller Rikleen: Thank you so much.Steve Pomeranz: So we're talking about the millennial generation, how big is this generation in the US?Lauren Stiller Rikleen: 86 million.Steve Pomeranz: 86 million young people.Lauren Stiller Rikleen: Yeah.Steve Pomeranz: Now we're talking about ages approximating what?Lauren Stiller Rikleen: Well,

8 More Ways To Save The Most Money, Ever

Need A Moving Company? Be Careful Who You Hire

9 Ways To Save The Most Money, Ever

Signs Of Health In Housing

How To Succeed in Business… Even If You’re A Millennial

Divorce Deterrent: Having The Money Talk Before Marriage

Understanding Risk In The Stock Market

The Art And Science Of Warren Buffett

Don’t Pay Your Medical Bills Right Away

Want To Franchise Your Business? There’s a Book for That.

The Real Estate Market in Flux…Again…As Always

Even Billionaire Investors Make These Simple Money Mistakes

This Wall Street Trader Uses Sex And Real Estate To Forecast The Market

To All The Single Ladies: Plan Now For Your Financial Future

Save Money By Letting This Genius Company Negotiate Your Bills

It’s Fair Weather & Sunny Skies For Home Prices In 2016

Here’s How Much A House Cost The Year You Were Born

What The One Percent Look For In Luxury Real Estate

A Fool-Proof Method To Invest Like Warren Buffett

‘Tis The Season: How To Dress Up Your House for Sale

Both Trump And Sanders Could Cause A Market Crash If Elected

Why Uber Lost $1 Billion In China

The One Graduation Gift That Will Last A Lifetime

In Search Of Fortune: The Allure Of Sunken Treasures

How To Continue Working In Retirement (And Still Be Happy)

Today’s Top Selling Home Styles

5 Takeaways On Interest Rates From The Fed

Buying and Selling Real Estate During Spring Fever

Checks These Signs First Before Following Company Stocks

Top 150 Retirement Friendly Cities In The US

Can Home Ownership Make Driving Your Car Cheaper?

9 Ways To Avoid Going Broke In Retirement

Retirement: A Contrarian’s Perspective

7 Retirement Benefits Threatened By The Obama Budget

Fear Not The Raging Bull Market

From Tiny Homes to Mega Mansions

Steve Shares Warren Buffett’s Inspiring Letter To Shareholders

What’s Hot & What’s Not In The World Of Real Estate

Inspire Like a TED Talk Speaker And Get Your Ideas To Soar

What To Do If You Win The Lottery (Or Get An Inheritance)

Avoiding These Tax Fraud Schemes Could Save Your Bacon!

Dear Kanye West, Daymond John Has Your Money

It’s Time For Some Unsolicted Financial Advise For Kanye West

New To Investing? 8 Rookie Mistakes To Avoid

Rising Home Prices Through the Lens of an App

15 Vital Tips To Get You Ready for Retirement

While we all eagerly await our retirement years, some go in better than others-and preparing ahead of time will make a world of differences in your finances, your quality of life, and your peace of mind.So, to make sure you do go in well-prepared, I constructed a list with the help of gobankingrates.com, cherry-picking some of their ideas, those that I encounter on a daily basis when advising clients.1. First And Foremost, Check Your Emotional ReadinessJust because there is a magical retirement age of 65 doesn't mean you have to fir into what is expected.  You want to ask yourself why you are retiring.  Is it to launch into a life of leisure, or is it just that you are tired of what you have been doing for oh-so many years?I find that many people say they want to retire, but the act itself is complicated and can touch up many issues, both financial and emotional.  Some soul-searching may be in order before you take this very important step.2. Bone Up On Interests And HobbiesWhat are you going to do in retirement?  I talk to some who say: "Nothing but play golf every day."  I understand this desire to get our of the rat-race and pursue a hobby, but retirement can be a very long period, and it seems an active person would grow bored within a few years.So, are there any other interests or hobbies that excite your imagination?  Visiting a country of your great-grandparents or sailing to exotic locations?  Taking a world tour?  Writing a book?  Picking up the guitar or the saxophone again and forming a band?  Why not?!?If this is the way you're thinking, a little pre-planning is in order.  Here are a few ideas.Whether you are pursuing a passion or looking for extra income, use the years leading up to retirement to build the skills, resources, and professional network you'll need to earn additional income after you leave your current job.3. Get OrganizedThe article suggests, and I quote: "Organization isn't just to make your life easier in retirement; it's also so loves ones can easily find key documents in case of emergency."  But organization can go a long way to clear the mind of clutter - and mental clutter can be your biggest enemy.Also, you want to start mapping out a post-retirement budget.  When you're working, you're getting a nice monthly pay-check and maybe some corporate perks, but all that goes away in retirement.So, where are your paychecks going to come from?  Do you have a pension?  When should you take social security?  How much can you spend of your savings to support your life and be sure your money lasts?These are big questions and while some are easy to answer, not all can be determined simplistically.  Consulting a good Financial Planner can help greatly in this stage of preparation.4. Avoid Lifestyle InflationThe years leading up to retirement are when your income will likely be at its highest - use of this higher income to add to savings.  Don't let salary raises lead to lifestyle inflation.  Keep your budget in check and take a close look at your monthly expenses to identify what you can do without.  This gradual approach will let you significantly cut your monthly expenses without feeling the shock of adjustment, and the money saved will give you the added benefit of boosting your retirement nest egg as well.5. Check Your Savings NumbersCarefully check your retirement numbers before you abandon the safety-net of a regular paycheck.  Some advisors recommend having roughly 10 to 12 times your final salary saved up before you start your retirement.  I think you'll need more in line of 15 to 20.  Either way, the more, the better.6. Coordinate Timing With Your PartnerIt is fun to think of retiring together and immediately embarking on your elaborate travel plans, but if one of you continues to work for a little while, you can both benefit from the employer's benefit package.

How To Invest In Today’s Complicated Market

With Bruce Johnstone, Managing Director and Senior Marketing Investment Strategist at Fidelity InvestmentsBruce Johnstone discusses tips on how to invest, the current market volatility and the unprecedented degree of  governmental intervention in the monetary system.  He suggests that in spite of this stimulus, economies are not responding as expected, and the markets are concerned about low growth and the possibility of deflation.Bruce then busts the myth that good investing should only include great companies, because as manager of the very successful Fidelity Equity Income Fund, he concentrated on cheap companies, citing that many great companies are over-valued.He used four criteria in choosing these cheap stocks: high dividend yield, low price to earning ration, low price to book value, and low price to sales.When asked where the best values were in the world today, Bruce said he felt that investing in the US is the best choice, because so many foreign countries are suffering from the oil crisis and other structural problemsSteve expressed concern about the fact that large foreign bank stock prices were back at 2008 levels and wanted to know if this was the so-called canary in the coal mine. Bruce responded by pointing out that the banks are in much better shape today than back then, and he feels that in most instances the market had over-reacted to fears of a banking crisis.The discussion turned to  negative interest rates, and both Steve and Bruce commented on how weird the situation had become.  Steve mentioned that Scandinavian mortgage holders where being paid interest by the bank each month, and Bruce said that although it is mind-boggling, he thought this would last a very long time. But to invest successfully, one had to do the research to find the cheap stocks that are always hiding beneath the radar.

How To Negotiate And Win, The MIT Way

With Lawrence Susskind, Professor at MIT, Author of 20 books on negotiation skills and techniques including his latest, Good for You, Great for Me: Finding the Trading Zone and Winning at Win-Win NegotiationsAcknowledging that we all negotiate in many aspects of our daily lives— with our spouses, our friends, our children—Professor Susskind defines how to negotiate, as it applies to his  online course, as the proper interaction between investors and entrepreneurs, so that each party presents and protects their respective interests in a manner that leads to positive results all the way around.As opposed to the “old school” way of selling, where the presenter or sales person goes into the room with a product or an idea and simply puts it on the table, Susskind teaches the value of advance preparation, the importance of building relationships, studying all the angles, and anticipating resistance, all important components of how to negotiate successfully.  He stresses the value of trust within these relationships. The venture capitalist, for instance, needs to keep connected to the inventor down the road, after the sale, in order to sustain and grow that business. Without trust between partners, there can be little chance of that happening.Professor Susskind’s online entrepreneurial negotiation course teaches these skills by matching each student with a partner and putting them into an interactive situation where they go through all the steps of an actual negotiation. After that, they watch a video of Susskind in a kind of debriefing, where he confronts the same situation, utilizing all the points of his program and his philosophy. For example, if there is an adversarial point in the negotiations, he illustrates how to handle resistance and bring the negotiating back to neutral ground.He concludes by saying that you don’t have to be the smartest person in the room to be a successful negotiator.  Instead,you need to be the best prepared, the best listener, and the most creative problem solver.

A “Novel” Guide To The Process Of Divorce

With Stan Corey, CFP®, CPWA®, Certified Financial Planner, Author of The Divorce Dance: Protect Your Money, Manage Your Emotions & Understand the Legal IssuesAfter many years of working with divorcing couples, Certified Financial Planner Stan Corey has written a novel called The Divorce Dance, where his characters Jim and Natalie take the reader on a sort of fictional journey through the entire process of divorce. Conceding that women are genetically more amenable to the idea of a self-help book,  Stan has Natalie be the teacher, the one who does the research and drives the story along.Early on in the story, Natalie interviews several attorneys, and judging by their strengths and weaknesses (which are described in the book) decides which is best for her situation. The reader, in turn, can learn which would be in their favor, often depending upon whether or not children are involved, the presence or absence of animosity, financial needs, etc.In addition, Natalie learns that often the best course of action involves more than simply the selection of a lawyer, but is greatly enhanced by incorporating litigation, mediation, and collaboration.Stan emphasizes the importance of knowing the divorce laws in your state. Although child support is mandated by statute, alimony and marital settlements are not, so determining the assets and worth of each couple is where a financial planner comes into the dance.In those states which are called equitable distribution states, Florida and Virginia are two examples, a detailed look at all assets and earnings precedes the allocation of finances, which is usually done on a percentage basis. The financial implications, particularly for the woman if she is the lower wage earner, are not always clear during the emotional period of the divorce process, so having that expert advice can be critical.

Starter Homes Set To Boost First Time Real Estate Sales

With Terry Story, 26-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLLuxury home sales have slowed down lately, so the gap in sales has been filled somewhat by lower priced new housing. For example, D.R. Horton in Florida, Texas, and the Carolinas is designing and building homes which are affordable for the younger first-time home buyer, a group that has in the past found new housing to be beyond their means. These homes range from a basic no-frills model to more up-scale, but still affordable levels.The scale of homes is also seeing an increase, from an average of 2660 square feet, not too long ago, to 2720, according to the National Association of Builders. In addition, the average price of a new home today is $350,000, an increase of $100,000 since 2009, which is pretty remarkable.Another current trend to note is the emphasis on playrooms as opposed to big yards, this being the obvious influence of millennials who are starting and raising families.As for rising mortgage rates, Terry says, it will happen, but no one knows exactly when.Not to be over-looked as affecting our current housing market is the fact that local communities, in order to not lose federal funds, must comply with affirmative action rules set by the U.S. Department of Housing and Urban Development, which can alter where affordable housing can be built.Real estate agents are also concerned with the impact of erosion on beachfront property, especially here in Florida where so many houses and condos are seeing the water coming closer and closer. This issue, Terry emphasizes, is of great concern.

The Value Of A Financial Advisor During Market Volatility

Joe Duran, CEO & Founding Partner of United Capital, Best Selling Author of The Money Code: Unlocking the Secrets to Great Financial DecisionsWith the markets swooning amidst high volatility since August 2015 and the S&P 500 down almost about 9% since the beginning of 2016, it’s been a pretty rough ride for investors. And Joe Duran, for one, believes we are in a bear market. To back that up, he points out that most stocks are down 20% in spite of the fact that standard indexes don’t reflect this. On top of all this, international markets have taken a beating and gold prices are up sharply, another reflection of bearish sentiment. There is good news, according to Joe, who thinks the end is in sight and we’re probably past the worst of it.It is possible that low interest rates which represent the current “flight to safety” may presage some talk of the “R” word (recession); but, Joe thinks if that does happen, it won’t be was bad as 2008 because individuals, corporations, and U.S. banks are much more financially secure.So if you’re thinking of rushing for the exits, think again… because it’s simply not all that bad, and U.S. markets should be able to bounce back from their recent weakness. Joe reminds us that while getting out is easy, most investors inevitably miss the “getting back in” part, because it’s virtually impossible to time that right. This is where a good financial advisor can be invaluable—to guide you through the tug of war between following your emotions and doing what is logically the best option for long-term wealth creation.

The Justice Department Goes After Luxury Home Buyers

With Terry Story, 26-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLWhile most people thought the Federal Reserve’s move to raise interest rates was the tipping point—beyond which mortgage rates would begin to climb back up—Terry sheds prescient light on why that is not the case. She says mortgage interest rates have little to do with the Fed’s raising of short-term rates, but more to do with the market’s overall view on where the economy and inflation are headed over the long-term. This expectation is more closely reflected by the interest rate on the 10-year Treasury bond. So with a tame economy and weak inflation (as is currently the case) mortgage interest rates continue to be very attractive.Moreover, as equity markets sink on fears of domestic and global economic weakness, investors move their money to highly liquid safe havens, such as the U.S. Treasury market. This action drives up Treasury bond prices, which also drives yields down and keeps mortgage rates low. So Terry urges home buyers to not read too much into the Fed’s quarter-percentage point rate increases.Terry also gives us a heads-up on greater government oversight in the luxury home market, homes that sell for more than $1 million in most parts of the U.S. and for more than $3 million in more expensive housing markets, such as Manhattan. She says the Justice Department’s Financial Crimes Network has initiated a pilot program to find out who’s buying these expensive homes, which could cause high-end home buyers to lose their anonymity. The government is apparently doing this to track “dirty” money and to keep it out of the housing market, which is probably a good thing.Finally, the short supply of affordable homes has led to a dramatic upswing in property rental prices and is causing multiple families to split the rent in single-family homes. Terry sees high rentals for the near future, but believes things will even out over time.

9 Vital Tax Breaks You Probably Never Heard Of

We all like to complain about tax breaks for millionaires and companies with offshore subsidiaries—but guess what! In recent years, lawmakers have enacted dozens of tax incentives targeted at middle-class families, ordinary working men and women, and I want to make sure you take full advantage of each one relevant to your situation. These tax breaks are listed on one of my favorite websites, Kiplinger.com.in recent years, lawmakers have enacted dozens of tax incentives targeted at middle-class families - for ordinary working men and women, and I want to make sure you take full advantage of each one that’s relevant to your situation1. Saving for RetirementLet’s begin with saving for retirement. Most of you know this. Anyone with earned income can contribute to a traditional IRA, but not everyone who contributes can claim a tax deduction.Here's how the deduction rules work for traditional IRAs. First, there's a $5,500 limit on how much you can contribute each year for everyone below the age of 50, and that limit rises to $6,500 if you're above 50 by the end of the tax year. Now if you’re working part-time and earn less than $5,500 annually, you can contribute 100% of your income up to the $5.500. I strongly urge you to contribute the full amount to minimize your taxes and get your savings going.2. Save and Be CreditedFew know about a special tax break available to low and moderate income taxpayers who are saving for retirement. If you are single and make under $30,500 or are married and earn under $61,000, you can get a credit on your taxes by taking advantage of the Saver's Tax Credit. A tax credit is a beautiful thing, because it comes right off your tax liability. This means that if your owe $2,000 and get a credit for $1,000, you end up owing $1,000, which is much better than a deduction against your income. The maximum credit is $1,000, so check with your tax preparer or tax software to see if you qualify.3. Get Paid (More) for WorkingFor those of you making less than 15,000 if you're single and $20,000 if you're married and filing jointly, our government provides a tax incentive to reward you for working. It’s called the Earned Income Tax Credit. Here’s what makes this popular: If this tax credit exceeds the amount of taxes you owe, you get a tax refund—a check back to you. In essence, you're no longer a taxpayer. But, here’s the deal. You MUST act to claim the credit by filing your taxes, a step many just don't take, even though it’s not complicated.For 2015, this tax credit ranges from $50 to $6,200, depending on your income and how many children you have. So if you aren’t making very much, this earned Income Tax Credit can sure help.4. Your Child, Your CreditFor new parents, each new baby comes with a $1,000 child tax credit to lower and middle income earners and continues every year until your child turns 17. Remember, as I said before, a tax credit is a beautiful thing, because it comes right off of your tax liability. This credit begins to disappear as income rises above $75,000 on single and $110,000 on joint returns. There's no limit to how many kids you may claim on a return, as long as they qualify.5. Get Credit for That Child’s CareYou may also qualify for a tax credit that will reduce the cost of child care. If your children are younger than 13, you’re eligible for a 20-35% credit for up to $3,000 in child-care expenses for one child or $6,000 for two or more. Eligible expenses include the cost of a nanny, preschool, before or after school care and summer day camp.Another way to reduce child care expenses is to participate in your employer’s flexible spending account for dependent care expenses. With these accounts, money is deducted from your gross salary ,and you can contribute up to $5,000 per year.6. Zero Tax on Capital GainsLet’s talk about Capital Gains. For most people, long-term capital gains (and qualified dividends) are taxed at 15 or 23.

Mohamed El-Erian Part I: Volatile Markets Ahead

With Mohamed El-Erian, Chair of President Obama's Global Development Council Chief Economic Adviser at Allianz, Author of The Only Game in Town: Central Banks, Instability, And Avoiding The Next CollapseMohamed El-Erian is chief economic adviser at Allianz (a multinational financial services company), the former CEO and co-chief investment officer at PIMCO, and author of The Only Game in Town: Central Banks, Instability, And Avoiding The Next Collapse. El-Erian serves as chair of President Obama's Global Development Council and is a columnist for Bloomberg View, as well as contributing editor to the Financial Times and a member of their A List.In 2009, Mohamed El-Erian and his colleagues at PIMCO predicted that economic growth would hit a slower “new normal” rate, which has largely come true and played itself out. He believes the “new normal” is coming to an end as the Federal Reserve maneuvers to extricate itself as the primary driver of economic growth— “the only game in town” as his book’s title says. So El-Erian sees the U.S. economy approaching what he calls a T junction, with some uncertainty ahead.He also addresses the impact of negative interest rates in the Bank of Japan and added stimulus by the European Central Bank as a means to overcome structural head winds and force money into the economy, and thereby pushing investors into taking more risks and triggering the “wealth effect”. He likens this to being pushed into a marriage, which he says is more likely to meet with resistance than being pulled into a loving union. So he believes Japan’s move into negative interest rates may not yield expected results. Moreover, such moves have caused companies to deploy their cash towards non-growth initiatives such as buybacks, dividends, and defensive mergers.El-Erian believes risk has migrated from the banking sector to institutions and households through the stock market. Since banks are highly capitalized and very cautious about lending, the risk now lies in the non-banking sector; so the Fed’s extricating itself from supporting the economy is causing higher volatility in the stock market. He also points to changing relationships between traditional asset classes. Oil and stocks now move in tandem. A drop in oil prices causes a sharp drop in stocks, making portfolio diversification all the more difficult. Looking ahead, he sees short-term volatility and urges investors to increase their cash positions to 25%-30% to weather a potential storm. In spite of that, El-Erian views U.S. stocks as a sound place to be invested in over the long-run.Click here for Part II

Mohamed El-Erian Part II: ETF Risks, Gold, And Market Gloom

With Mohamed El-Erian, Chair of President Obama's Global Development Council, Chief Economic Adviser at Allianz, Author of The Only Game in Town: Central Banks, Instability, And Avoiding The Next CollapseMohamed El-Erian addresses the risks posed by exchange traded funds (ETFs), which he views as powerful instruments that deliver diversification and liquidity, but advises investors to remember they are buying the whole basket. It’s like going to a restaurant and ordering the whole menu. When you do this, often the bad components of an ETF can undermine performance from the good ones, and this doesn’t always make sense. Secondly, ETFs give you the delusion of liquidity; because when markets tank, ETFs may trade with prohibitive bid-offer spreads of as much as 10%. He believes ETFs make sense for investments in broad indexes such as the S&P 500 ,but investors need to be cautious when looking at specialized esoteric markets such as high-yield ETFs.He also talks about the value of gold as a safe haven and believes people romanced gold and took prices too high, but then under-bid to where current gold prices are more reasonable. He recommends having up to 5% gold in your portfolio, because it’s negatively correlated to many other investments  and adds diversification.He believes investors need to be cautious now for two reasons: The Fed’s inability to predict the risks faced by the U.S. economy, and the impact of human behavior when fear precipitates bad investing practices. Finally he addresses how technology is driving exciting innovation while socio-economic winds of change are threatening economic growth.

My Brush With Bernie Madoff

I watched the ABC movie about Bernie Madoff this week, which brought back a surge of memories I’d like to share with you.It was circa 2004 when I got a call from a client just dying to sign up with Bernie Madoff...It was circa 2004 when I got a call from a client just dying to sign up with Madoff. My client had been talking with a friend who had been in the Madoff fund since its inception in the 60’s and was arrogantly touting its many attributes.This friend had invested 2-3 million with Bernie Madoff and had also gotten others to do the same. He told my client he thought he could convince Madoff to invest his money since he knew Madoff personally and so had an “inside track”. Rounding out the rest of this story, this friend had also involved the in-laws of my client’s daughter, and those in-laws had invested all of their money—plus their entire company’s bankroll into the fund.A few days later, at my request, my client and his friend came back to my office with the Madoff statements, so I could take a look. The first batch of statements looked legitimate (like any other brokerage statement) but were missing some important details. When I asked if there was more, I was handed a large bundle of print-outs printed from an old dot-matrix printer. You know, the type of paper with the holes on each side! This print-out contained all of the trades going back a number of years.I thanked them, and over the following number of days, I studied it all. The information on those sheets raised a lot of questions.The first thing I noticed was that all of the trades were made in the middle of each month—different dates of the month, but definitely clustered in the middle. Each trade contained a purchase of an index fund, which held the top 100 companies in the S&P 500. Alongside these trades were purchases of puts and calls, which are normally used to enhance the return or protect the principal.It didn’t make sense. How could anyone know what particular day to buy and sell these investments in order to achieve a consistent annual profit of 10%? There were only two possibilities, as far as I could see.The first possibility was that somehow Madoff knew when large institutions were actively in the market buying and selling. If Madoff placed his own trades before placing his investor’s, he might be able to pull this off. I knew Madoff’s brokerage firm was a market maker, which is a firm that facilitates trading in a security and therefore sees customer order flow. So bottom line, if he sees the order flow, he can get in front of it.There’s only one problem with this. It’s illegal. It’s called front running, and it is against the law for any broker to put his own trades ahead of a customer’s order.That was a big red flag.The other possibility was that it was all a fraud. I couldn’t wrap my head around this. Madoff’s name had been around ever since I could remember, and I had never heard any negative news surrounding him. The thought of a Ponzi scheme crossed my mind, but I couldn’t believe it.Needless to say, I counseled my client against putting his money with Madoff, which turned out to be one of the best things I had ever done. Saving a client from disaster is a wonderful thing.What happened to the friend? The friend, who had believed he was worth $8-9 million (according to my client) and had received his original investment back through monthly dividends (of other people’s money, of course), ended up with nothing. The in-laws were wiped out as well, along with so many others.Some further thoughts and take-aways from the Bernie Madoff tragedyIn 2009 or 2010, I interviewed Laurence Leamer, a terrific author in Palm Beach, who had written a book called Madness Under the Royal Palms about Palm Beach Society. He mentioned that the Jewish Community in Palm Beach was very philanthropic.

Home Prices Hitting Record Highs Once Again

With Terry Story, 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLTerry addresses November 2015’s rising home prices and all-time highs in select markets such as Dallas, Denver, San Francisco, and Portland, areas that have fully rebounded to pre-crash levels, causing tight inventory and affordability issues. She sees inventory of “saleable” properties (those which pass the 4-point inspection and are otherwise desirable) as the biggest issue right now. Buyers want to buy but don’t want to over-pay.And she still sees appraisals lagging the market, where comparable homes are hard to find, making home values hard to peg down. But buyers can work around lower appraisal prices by negotiating with the buyer or putting up the difference as cash, because the lender will peg to the appraised price.She also addresses new home sales, which were up 11% in December 2015 due to seasonally warm temperatures, especially in the northeast. She attributes this to steady job growth, low unemployment, and an uptick in wages—all of which are positives for the home market. People are also still eager to lock in low interest rates, which is spurring home sales. The strength of the U.S. dollar versus the Canadian dollar is also driving some sales by foreign owners who are keen to cash out and repatriate funds back to their home countries. However, Terry believes in holding on to homes for the long-run rather than trying to run a quick profit.

Inside The Mind Of One Of The Greatest Gurus Of Value Investing

Walter Schloss: One of the Greatest Minds of Value InvestingEveryone has heard of Warren Buffett and perhaps a few of you know some other names like Peter Lynch from Fidelity and John Templeton from the Franklin Templeton Funds, but I bet most of you have never heard about the legendary stock-picker, Walter Schloss. Schloss was one of the world’s best investors of all time, despite never having even touched a computer or used the Internet. Schloss died in 2012 at the ripe old age of 95,  so let’s find out some more about him and start at the beginning.Schloss never attended college, and at the young age of 18 he started out as a “runner” on Wall Street… a runner was someone who literally ran the orders from the brokerage firm to the trading floor. Then World War II struck and after Schloss served his time of duty he returned to his passion and went back to Wall Street. Schloss decided to educate himself on the business of stocks through courses offered by the New York Stock Exchange, and (get this!) was lucky to have legendary value investor Benjamin Graham as one of his teachers. Of course Ben Graham was the biggest influence on Warren Buffet and others and is considered the Father of Securities Analysis. Schloss excelled at this because he then went to work for the Graham-Newman partnership where he honed his investing skills. And, in 1955, he founded his own firm: Walter J. Schloss Associates - where he racked up one of the best records in investing history until his passing in 2012. When he decided to close his firm in the early 2000s, his record stood at a compound average annual return of 16% per year over a 40 year career – that’s pretty astounding! To put that in perspective, that’s the equivalent of turning $100,000 into $38 million over a 40-year span – pretty remarkable!Book Value and HonestySo how he achieved such spectacular returns was the result his investing style which was based on the value investing techniques developed Benjamin Graham. As Walter put it so simply, “we buy cheap stocks.” While the concept sounds overly-simple, what he really meant to say was “we buy stocks cheap”… and by cheap, he didn’t mean buying up the cheapest stocks in terms of price, but buying stocks that were selling well below their intrinsic or book value.In an interview he gave to Forbes many years ago, he said, “I focus on assets. If you don’t have a lot of debt, it’s worth something.” Aside from buying firms below book value, Schloss looked at the management of a company and whether they were overly greedy or honest. While he did not personally visit each company, he relied on his observations and analysis of how management ran the business over time… and that gave him a good prediction of whether the business would or would not prosper in the future.And, ultimately, he found the combination of honest management and buying at a large discount to book value turned out to be a very powerful combination.“Own It”While investing in stocks with honest management and a low price relative to book value was key to his success, he also understood the importance of adequately diversifying his holdings, stuffing over one hundred companies into his portfolio. In fact, if he saw a good opportunity, he just had to buy it. As he stated in an interview in 2003, “the important part is to have some money in the stock. If you don’t have any money in a stock you tend to forget about it.” And that is so true… so where he saw value, he added the company to his portfolio, and committed himself to following the company.Schloss was also firm in his convictions. In fact, as a contrarian, Schloss was also famously fine with Warren Buffett’s criticism that diversification was protection against ignorance. In fact, in one of his talks, Buffett went on to praise Schloss’s stubbornness, saying “He owns many more stocks than I do and is far less interested in the underlying nature of the business; I don’t seem to have ver...

How Well-Diversified Portfolios Beat Inflation Over Time

With Terry Savage, Nationally Recognized Expert on Personal Finance, the Markets and the Economy, Author – The Savage Truth on Money (Amazon.com Best 10 money books), Author - The New Love Deal:  Everything You Must Know Before Marrying, Moving In, or MovingTerry Savage and Steve Pomeranz are both featured speakers at the MoneyShow in Orlando, Florida, in March 2016, a convention that offers individual investors a one-stop resource for unbiased investment education with keynote sessions, panel discussions, free educational seminars, state of the art investing tools, live trading software, networking opportunities, and more. While Steve will talk about investing like Warren Buffett, Terry will talk about focusing on things beyond investing. She says that while most people do focus on their investing, they need to also focus on doing something with the money they’re accumulating, such as their IRA withdrawal plan, their estate plan, long-term care insurance, etc.Terry’s website features a recent interview with Warren Buffett. She addresses recent market volatility in the first month of 2016, and advises investors to focus on basic facts and to keep things in long-term perspective. The one fact she likes to share is that there has never been a 20-year period (going back to 1926) when investments in large diversified U.S. stocks—with dividends reinvested—have ever lost money, even after accounting for inflation. So stay invested over the long run and believe in the American economy!Although everyone has heard this many times, it’s difficult to act on this simple advice, because investors are often driven by fear and greed, which often does them in. Here’s where Terry recommends having a good fee-only investment advisor. So know your stage in life,  plan for what’s next, and diversify your portfolio accordingly—all necessary tools to beat inflation.She warns against taking extraordinary risks just to earn a slightly better return and respects the value of having a certain amount of your portfolio in cash, so you have enough to see you through retirement.Finally, Terry’s surprised by the Millennial Mistake, the notion that millennials prefer employer provided paid time off and life insurance instead of 401(k) benefits. She understands that the 2008 crash was brutal for many of them but wants them to use time, the greatest asset they have, to grow their wealth in a compounded fashion.

Kiplinger Says No Recession Brewing for the US Economy

With David Payne, Staff Economist and Reporter – Kiplinger LetterThere’s a lot of economic uncertainty out there—particularly outside US borders—with a sharp drop in oil prices causing worries in the US energy sector and a slowdown in China impacting sales at American companies across the spectrum. Understandably, this uncertainty is playing out in the stock market and causing anxiety for many Americans. But David Payne and his team at Kiplinger believe the US economy is on sound footing and in little danger of tipping into a recession.Here’s why: Our underlying economic fundamentals are sound, and David expects the US economy to expand at a 2.5% clip in 2016 with strength in consumer spending, continued low unemployment, a healthy housing picture, rising residential and commercial rental rates, sound consumer credit, high automotive sales on low gasoline prices, etc. He also believes economic fundamentals in the US should lead to an uptick in stock prices in 2016.And while he believes gasoline prices will not go much lower, he sees malaise in the energy sector that won’t go away until oil prices rebound and thinks exporters will continue to see foreign profit growth counteracted by the strong dollar, with no dollar weakening in sight until 2017. So exports will likely stay flat or even dip a little in the coming months, which will hurt manufacturers, from makers of steel and other fabricated metals to producers of heavy machinery. However, a higher dollar will keep a lid on US inflation.But this weakness will be offset by gains elsewhere, such as a pickup in consumer spending, which accounts for roughly two-thirds of economic activity. Savings at the pump can also boost spending on travel, dining out, and other leisure activities, as well as encourage personal savings.Kiplinger also projects a rise in business spending in 2016 with investments in technology and vehicle fleets but not so much on building up inventories. In addition, stronger tax collections should result in expanded government spending at the federal, state, and local levels, benefiting everyone from defense contractors to road and bridge builders. Housing and health care services are also expected to propel job and wage growth, further strengthening the US economy. Moreover, David believes overall hiring will stay strong and expects employers to add about 200,000 new workers each month in 2016, on average.

Don’t Let Climbing Interest Rates Derail Your Home Purchase

With Elysia Stobbe, Author – How to Get Approved for the Best Mortgage without Sticking a Fork in Your Eye: A Comprehensive Guide for First Time Home Buyers and Home Buyers Getting a Mortgage since the Mortgage Crisis of 2008Interest rates are all over the map nowadays. Because of the Federal Reserve, short term rates have risen and long term rates have dropped. As a mortgage industry expert, Elysia Stobbe sees interest rates trending downward and believes it is still a great time to lock in a 30-year mortgage at very favorable rates. But if the Federal Reserve goes through with its planned increases (four 0.25% quarterly increases for a total increase of 1% in 2016), monthly mortgage payments could rise considerably. However, Elysia cautions buyers against overly finessing mortgage interest rates, because a small fractional rise won’t amount to a significant increase in your monthly mortgage payment.She also believes people should make a home purchase only if they can comfortably afford a mortgage. To her, the safest loan-to-income ratio should be one-to-four, where your monthly mortgage is no greater than 25% of your monthly income. Because she tends to be overly conservative, she tells us not to take that 25% recommendation as set-in-stone (especially now when mortgage rates are at all-time lows) and to be open to increasing your mortgage outlay to perhaps a third of your monthly income, but only if it wouldn’t put a strain on your lifestyle.

Are You Ready For The Self Sufficient Home?

With Terry Story, 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLHas the future finally arrived, and do we now have the long awaited self sufficient home? Terry believes we’re getting one step closer with innovations such as Amazon’s Replenishment Service where machines at home, such as printers or appliances, automatically reorder supplies when needed. For example, your laundry machine could automatically place an order for detergent when it’s running low—one less thing for you to worry about on your to-do list! Sounds kinda nice and promising and could help us cut down on a lot of routine chores.Changing gears, more 55+ home owners now are selling and moving into rental properties, causing an increase in rental prices, particularly for high-end luxury rentals. This rise is attractive to real estate investors and is fueling a selective construction boom. The rental market is also attractive (and often the only option) for many people who were adversely affected by the 2008 economic downturn and who haven’t yet been able to qualify for a mortgage. Another reason rental properties are hot right now.Finally, a lot of people don’t trust traditional FICO credit scores, causing online lenders, such as Social Finance of San Francisco, to switch to other measures of creditworthiness. These lenders offer personal, student, and home loans by looking at more forward-thinking credit measures and by discounting one-off factors, such as job losses during the 2008 crisis. These factors are often better indicators for predicting someone’s creditworthiness.

8 Major Mistakes People Make After Retirement

While we all make financial mistakes, it’s easier to bounce-back and get-back-on-plan while we’re young… and do-able - but harder to bounce back as we get older… because, a) retirees typically do not have a nice regular paycheck coming in but have to carefully make the most of their retirement savings to meet monthly expenses, and b) because, unlike say a 25- or 35-year old, folks in retirement do not have the luxury of time to make up for mistakes – so the margin of error is much smaller for retirees than it is for younger workers.So I want to forewarn you, and keep you from making some of the worst mistakes I’ve seen people make in retirement. I’ll also share a link to an article on this topic – from FinancialWord.com - on my website – www.OnTheMoneyRadio.org - so you can listen to my thoughts on this subject and read more about it. So let’s get started with the worst mistakes people make in retirement.For most folks, retirement means a sudden drop in monthly spending power… because now – and for the rest of their lives – they’re fully dependent on their savings, social security, and a pension check if they’re lucky1) Not Changing Your Lifestyle After RetirementRetirement is often a time of significant financial change – from having a paying full-time job to having no regular pay check for the rest of your life (in most cases). For most working class folks, this means a sudden drop in monthly spending power… because now – and for the rest of their lives – they’re fully dependent on their savings and social security, and a pension check if they’re lucky. But one of the biggest mistakes retirees make - is not adjusting their expenses to their new budget-dependent life – where food, clothing and entertainment expenses must be adjusted because they are no longer earning the same amount of money as they were while in the work force.Retirees must also account for healthcare and long-term-care costs as a person ages. So talk to a trusted financial planner to make adjustments to your budgeting and planning, so you are prepared for any eventuality.2) Failing to Move to More Conservative InvestmentsOnce you have retired, you can’t afford large negative swings in your savings. So you have to balance out portfolio growth with a reduced level of risk, and think more short-term because you may not have the luxury of riding out long-stretches of a down-market without withdrawing money or selling shares. So while you should still keep some money in aggressive growth investments, make sure you reduce your risk exposure and factor in worst-case scenarios such as an extended bear market and how you plan to weather that… all I am saying is don’t be overly optimistic or overly pessimistic, but plan well so you can ride out the worst, should it so come to bear.3) Applying for Social Security Too EarlyNow… I think most of my regular listeners are aware of this because I have spoken often about the penalties associated with early withdrawal of social security… so to recap – just because you are eligible to apply for Social Security at age 62 does not mean that you should. If you tap into social security at age 62, you’ll get about 25% less than what you would get on your full retirement age of 66. You will also get 32% less than if you wait until age 70. So if you’re in reasonably good health, delay your application for retirement benefits until 66 for sure, and until age 70 if you can. If that means taking a part-time job – well below your qualifications even – I’d say it’s worth doing… if it helps you meet expenses and allows you to put off social security withdrawals.4) Spending Too Much Money Too SoonWhen you retire and have saved and invested regularly, you may be in the happy state of having a pretty large nestegg… but make sure you don’t spend too much money too so...

Manage Your Investments Like An NFL Team

With Robert Stammers, Director of Investor Education at the CFA Institute, Contributor for Huffington PostBob Stammers likens managing your investments to an NFL team, and believes one can learn a lot from football strategy that can then be applied directly to managing your money. For example, like football teams that spend a significant amount of time in the preseason determining their overall team strategy, investors must also determine their overall investment objectives, what strategies they will employ and which assets they should purchase before constructing a portfolio.Just like an NFL team, an investment portfolio needs solid offensive and defensive strategies that are determined through the assets you buy. On a football team, players are picked to play a specific position on the field. In investment management, each asset has a specific role in achieving an investor's long term financial objectives. In fact, it's the asset allocation between investments in securities like equities, bonds, and alternative assets that have proven to have the greatest impact on a portfolio's investment performance. For example, in many portfolios a large allocation to equities is an offensive strategy that can be compared to the passing game. However, like the passing game, equities are also riskier in relation to most other assets and can cause investment losses and portfolio values to swing unpredictably.Investing in bonds can be compared to the ground game. Using running backs does not usually result in large yardage gains, however it does provide stability in the offense and reduces the risk of turnover. Like the ground game, bonds provide portfolio stability and although performance is often less than that of equities, it is much more consistent and in investment terms does not provide as much risk. You get the idea.Bob also provides analogies for alternative assets (real estate, commodities, private equity and hedge funds), managing risk, playing defense, and having the right coach.

What Your Financial Advisor Isn’t Telling You

With Liz Davidson, CEO of Financial Finesse, Author of What Your Financial Advisor Isn’t Telling YouLiz speaks directly to average investors who are likely pretty good at their jobs and sincere about saving diligently for retirement and other life expenses, but don’t quite know how to effectively handle their financial and retirement portfolios. One of Liz’s main points is that average investors need to realize that how they manage their daily lives has a profound impact on their finances, perhaps more so than the specific investments they might make – issues that financial advisors are mostly unaware of and unable to address – such as, say, mediating an argument about money matters in a couple’s bedroom.Liz also draws on her experience as a hedge fund manager to better advise people on how to manage their money, especially as she saw really smart people making not-so-smart moves during the dot-com boom of the late 90s. And get this… Liz believes the average employee could be leaving as much as $1 million on the table by not taking full advantage of the various benefits offered to them over their working lives – things such as maxing out matching 401(k) grants (and, really, leaving free money on the table), or not taking advantage of subsidized benefits such as tuition reimbursements offered by employers for employees or qualifying dependents, adoption assistance, legal support, etc. For example, with a Health Savings Account (HSA), employees can put money in there, get a tax deduction and use the money at any date in the future, with tax-free money – without the downsides of a use-it-or-lose-it account.Liz talks about the concept of “Financial Independence Day” each year – when you setup your finances to get you more solidly on the path to building-up your nest-egg. And busts the myth that investors can do without a financial advisor – because most investors have neither the time, the expertize, or the discipline to make the most of their money including tax optimization and investment decision-making. Finally, she gives us tips on how to find a good financial advisor and how spouses or life partners can do a better job of rowing the boat together.

How This Year’s Interest Rate Changes May Impact Your Life

With Greg McBride, Chief Financial Analyst, BankRate.comGreg McBride gives us BankRate.com’s 2016 Financial Outlook. He starts with the Federal Reserve and says he doubts that the Fed will actually go through with raising interest rates changes four times in 2016, as they’ve indicated. Greg sees them raising rates twice in 2016, or perhaps three times at the most… and that’s going to increase the price of money across the U.S. economy and the world.The dynamic this time around is also different – banks are sitting on huge sums of investor deposits and are in no rush to raise interest rates on savings and CDs to attract deposits… so investors will likely have to work harder to earn a decent return on capital – perhaps looking at credit unions, online banks or smaller banks for slightly higher rates. The post-2008 regulation on banking has also restricted lending – so they’ve raised the cost of borrowing but are going to hold down rates paid on deposits. But borrowers beware of adjustable rate loans, because in a rising interest rate environment, higher rates could really throw your finances off balance. So this is still a great time to switch to an appropriate fixed-rate mortgage to avoid higher monthly payments and insulate yourself from rising rates.Greg also warns against early cashing out of your CDs because early withdrawal penalties could cost you more than the interest you’ve earned on that deposit. So if you have some CDs, just bide your time, let that money stay in the CD till it matures, and only then cash it out.

The Housing Market And The “Missing Link”

With Terry Story, 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLTerry updates us on the housing recovery’s “missing link”… and what she’s alluding to is the drop off in first-time home buyers. In the past, first-time home buyers have accounted for about 40% of homes bought, but that number has now dropped to about 30% – and that’s a problem… because if first-time home buyers don’t buy, then the number of move-up buyers reduces. So first-time home buyers are critical to building a solid base for the housing market.When surveyed, 56% of 18-34 year old first-time home buyers wanted to buy a house but were not aware that they could do so with just a 3% down-payment – much less than the 16% down payment misconception many of these younger potential buyers had. So there’s misinformation amongst this critical group that is also holding the housing market down, and education is key. Many of these buyers also have fresh memories of the recent housing crisis, and that too is driving hesitation.But as the employment picture brightens, first-time home buyers should step-up more boldly into the housing market. Moreover, most surveys indicate that housing should rise by about 3.5% in 2016, and that there’s little long-term downside from where home prices now stand. Prices now are also a lot more stable than they were before the 2007 crash.Terry answers a listener’s question… about a do-it-yourself deed that has incorrect information – and what the new owners will have to do to clear up their deed – because a bad deed is a dead-stopper for a re-sale. Finally, Terry talks about a For-Sale-By-Owner situation and how the seller needs to work against a slew of people that are essentially against you, trying to beat you down on the deal. So FSBO only if you have a lot of information on home sales minutiae, else you’re simply better off getting an agent.

Here’s How To Handle Today’s Market Volatility

As humans, almost all investors are naturally inclined to follow tendencies dictated by our psychology. We extrapolate recent events into the future, and we are scarred by prior traumas. These reactions make total sense in some cases but in the case of investing, they can ruin our financial future. The thinking that causes us to extrapolate rising markets as if they will continue to rise forever or extrapolate market declines as if they never end, goes hand in hand.Remember Real Estate in 2005? So many extrapolated that this rising market would go on indefinitely. Or how about 2008? Yes, it was scary and the decline was downright brutal. But did the United States “go out of business?” Of course not. Yet so many pulled their money out of the market only to see it rise for the next 7 years without them. So yes, for the past 7 years, we have gotten to expect that markets go straight up, as they have done since March 2009 – but the minute that we see any deviation from those expectations, we anticipate a market meltdown like 2008. The reality is though, that the future doesn’t always follow such extreme examples. As a matter of fact, those extremes are quite rare. And indeed, “extreme” is a word that can be used to describe both the disaster of the financial crisis ‘08 and the tremendous bull market that followed, of which both were almost without parallel.In reality though, the market is more inclined to follow a pattern seen throughout much of history. And that is one with more volatility than we have seen in the past seven years, and one that might neither go straight up nor straight down. We must recognize the tradeoffs that dictate the fact that, with higher potential reward comes the necessity to undertake more potential volatility. And this market volatility often means losses from time to time, in a way that is neither extraordinary nor necessarily predictive of any looming calamity.Yes, there are positives and negatives in the world. But when are there not?Positives:The economy grew at its long term potential growth rate, but even that was sufficient to provide for strong payroll gains during the quarter. The fed hiked rates indicated that it would proceed at a gradual pace, heartening investors who may have worried about rapid tightening. The drop in energy prices could boost consumer spending over the longer term, though early indications have been consumers’ preference for saving that windfall.Negatives:Global growth concerns, such as in China, could have ripple effects through the global economy; the strong dollar continues to be a strong headwind to U.S.; the sharp plunge in energy prices prompted a sharp cutback in capital spending by many energy firms, and has had ripple effects throughout the stock and bond markets.You always climb a wall of worry in Wall Street and it really does you no good to fret about it.You always climb a wall of worry in Wall Street and it really does you no good to fret about it. But I can instead offer a few questions for you to think about. Have you calculated or sat down with somebody who will help you measure the outcome of good and bad markets on your financial goals. I mean in particular, within the context of how YOU want to live. Not some generic, one size fits all calculator that you found on the Internet.Can you or your advisor identify those areas of your finances that are in your control and those that are not in your control? Knowing this is key to what to do if something out of the ordinary happens. Make sure this analysis includes an understanding of the psychology of investing, to help you make the right decisions and help you understand what money really means to you and how money’s role in your life motivates you: In other words, does money represent the attainment of Happiness for you or freedom from Fear, for you?Also, in times like these, it is imperative that you recognize the human instinct to “do something”.

Bright Spots in America’s Retirement Preparedness

With Ben Steverman, Reporter – Bloomberg NewsIn a bit of optimism for retirees, Ben Steverman says America’s retirement preparedness is not all doom-and-gloom, and there is a lot average Americans can do to be financially ready for retirement. He starts with talking about Social Security – and say “it’s there” – that there’s enough money in the program through 2033, and beyond with likely new measures over the years. He also has good things to say about Medicare, and will take care of bare necessities.For those without a pension, for consistent lifetime income, investors should look at investments that can provide a steady stream of retirement income, and consider options such as Reverse Mortgages to tap into the equity they’ve built up over decades. He also recommends Target Date funds - where an investor provides his retirement date and the fund automatically rebalances his portfolio allocation between stocks and bonds as he nears retirement date – so investors themselves don’t have to worry about portfolio rebalancing over time. Target Date funds are simple and have a low structure but they really only work if all your retirement money is in target-date funds… which is not the case for 62% of all holders - who mix and match them with other investments to “diversify” and lose about 2% in performance compared to those who go all-in with target-date funds. So a mix-and-match approach changes your risk profile in ways that typically do not benefit your portfolio, and this 2% under-performance can significantly impact your portfolio over 20 to 30 years.Ben also reveals, surprisingly, that despite the millennial generation’s much-touted aversion to the stock market, 84% of their retirement assets are invested in stocks, while baby-boomers hold a disproportionate 69% in stocks – perhaps more than they should in percentage terms - despite being much closer to retirement. His bottom-line recommendation – stocks are a great investment vehicle over the long-term but - because markets tend to be volatile – it’s not where you should park savings intended for tuition or a mortgage down-payment.

Housing Market Returns To “Normal”

With Terry Story, 26-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLThis week, Terry talks about a return to “normal” in the housing market after the best-year ever since 2007. So Terry believes the home-buying market will stabilize and slow down a little after rising sharply higher over the past few years. With a strong jobs report and clear signs that the U.S. economy appears to be getting back on its feet, Terry expects more millennials to enter the housing market, just as baby-boomers downsize as they enter retirement. Builders, who had earlier targeted higher-priced luxury homes, now see a trend reversal that makes affordable construction more appealing – to match the increased number of lower-paying jobs. As a result, markets with the highest prices could see some cooling.And while the Federal Reserve has raised short-term interest rates, long-term interest rates remain really low by historic measures and continue to support the return to normalcy in housing. Moreover, high rental rates – with many renters paying more than 30% of their income towards rent – might also spur a move away from rentals to property ownership, especially if more affordable homes come to market that require a smaller down-payment – because in 75% of the U.S., it’s cheaper to own a home than pay monthly rent.Terry also addresses the shortage in supply of homes for sale – with inventory at just 5.1 months across the U.S. Anything less than six months is a seller’s market because there is less inventory, solid demand, and prices could be bid up, especially if your home sits in a desirable neighborhood. That said, it may not always pay to downsize if you live in a state that rewards home ownership through lower taxes, or where downsizing does not really improve your overall quality of life.

The Year That Nothing Worked: A Look Back At 2015

Welcome to 2016 and Happy New Year… I wish my listeners a great year personally and professionally – and hope you achieve all your savings, retirement and investment goals.Now, looking back - 2015 wasn’t a great year for the market as a whole… the Dow Jones ended the year down 3.5%, the S&P 500 was down 2.15% but the tech-heavy Nasdaq bucked the trend to post a 4.2% gain in 2015.Gold, Silver, CommoditiesGold investors lost money as the precious metal dropped from slightly over $1,200 per ounce in January to about $1,060 by year-end. Silver dropped from the $16 per ounce level to about $14. Commodity prices tanked about 22%, especially towards the second half of 2015. In fact, commodity prices fell to a decade low as tepid global inflation dimmed the allure of precious metals, as weak Chinese demand hurt raw-material prices, and as a global supply glut sent crude oil tumbling.Interest RatesInterest rates on CDs ranged from 1.05% to about 1.76% - quite on the low side. 10-year Treasury rates climbed from about 2.12% in January to 2.27% at year end – so bonds lost value as rates rose. In the bond market, high-yield corporate debt headed for its first decline since 2008 amid a flood of investor redemptions from junk bond funds and concern that rising borrowing costs could threaten solvency for the low-credit companies that issue junk bonds.Median home sale prices rose in 2015 – prices on existing homes went up a healthy 11% from $198,000 in January to $220,000 in November; median prices on new homes also moved up, a modest 4.4%, from $292,000 in January to $305,000 in November.30-year mortgage interest rates showed some volatility but were largely range bound – moving from about 3.66% in January to a high of 4.09% in July 2015 and ending the year at 3.96% - so mortgage rates continue to hover near all-time lows.And the Federal Reserve finally nudged up interest rates - by 0.25% (25 basis points) in mid-December – with cautious and measured increases in 2016 based on the strength of our domestic economy and headwinds in the global geopolitical landscape.2015 wasn’t a great year for stocks, bonds, cash deposits, gold or silver. It was also the worst year for asset allocation funds since 1937So 2015 wasn’t a great year for stocks, bonds, cash deposits, gold or silver. It was also the worst year for asset allocation funds since 1937. Asset allocation funds are based on diversification – so when one market struggles, the fund reallocates its assets to chase performance… but, in 2015, that didn’t work either.Asset Allocation StrategyIn an asset allocation strategy, money managers typically diversify their funds through investments in four broad buckets - stocks, bonds, cash and commodities. But the correlation of across-the-board declines in 2015 made it virtually impossible to amplify returns by rotating among assets. Since 1995, practically every year has seen some asset deliver returns exceeding 10 percent. Sadly, not so in 2015, as the equity market and bond market were more joined at the hip than normal, as Lu Wang notes in a recent article on Bloomberg.com.After embracing everything from Treasuries to high-yield bonds and technology shares amid seven years of zero-percent interest rates, investors found themselves with nowhere to run in 2015 - as the Federal Reserve’s campaign of stimulus drew to an end. So while the Fed stimulus lifted all boats, the Fed’s withdrawing of stimulus appears to be holding the boats down… and exchange-traded funds that invest in different asset types as a way to diversify risk have struggled. Among 35 such ETFs tracked by Bloomberg, the median loss for 2015 was 5 percent.Uncertainty over the timing of the Fed’s first interest rate increase in almost a decade and its potential impact on the economy also weighed on...

Make Your Money Last In Retirement

With Jane Bryant Quinn, personal finance expert and author of How to Make Your Money Last: The Indispensable Retirement GuideJane Bryant Quinn is a nationally known commentator on personal finance, with books and columns read and trusted by millions. In her long career, she has established herself as one of America’s most reliable voices for people trying to manage their money well. In her public policy writings, she addresses matters including investor protection, health insurance, Social Security and the future of retirement accounts.She writes a column every month for the AARP Monthly Bulletin and AARP.com on issues affecting people in mid-life and retirement. Her newest book, How to Make Your Money Last: The Indispensable Retirement Guide, was published in January, 2016.She talks about the five stages people go through when they enter retirement. She emphasizes having an emotional plan in addition to a retirement plan – so you’re mentally prepared for all the freedom and the breakaway from routine (with upsides and downsides) that retirement brings. There’s the initial honeymoon period but after a while emptiness and a loss of status could set in, or your money might be going out the door faster than you thought, or you could get depressed over having nothing to do. So it’s important to get engaged in meaningful activities so you reorient yourself to being retired. She compares retirement to graduating from school, with that feeling of what am I going to do now?!In her book - How to Make Your Money Last – Jane shows you how to turn your retirement savings into a steady paycheck that will last for life. Today, people worry that they’re going to run out of money in their older age, or when one spouse dies. She talks about how much money you should take out of your savings every year to make your money last 20-30 years or more. That won’t happen if you use a few tricks for squeezing higher payments from your assets—from your Social Security account (find the hidden values there), pension (monthly income or lump sum?), home equity (sell and invest the proceeds or take a reverse mortgage?), savings (should you buy a lifetime annuity?), and retirement accounts (how to invest and—critically—how much to withdraw from your savings each year?). The right moves will not only raise the amount you have to spend, they’ll stretch out your money over many more years. She also talks at length about using Immediate Pay Annuities to your advantage as an extra guaranteed income – the only type of annuity that she’d recommend to retirees so they can raise their standards of living.She also offers up a look at savings and investments in a new way. If you stick with super-safe choices, the money might not last. You need safe money to help pay the bills in your early retirement years. But to ensure that you’ll still have spending money 10 and 20 years from now, you have to invest for growth, today. Jane shows you how. At a time when people are living longer, yet retiring with a smaller pot of savings than they’d hoped for, her book could become your guiding light into retirement.

Should The U.S. Ditch The Penny?

With Philip Diehl, Former Director at the U.S. MintShould the U.S. government get rid of that little copper colored coin that none of ever seem to really use – the penny? Philip Diehl, former Director of the United States Mint under the Clinton administration, says we should’ve ditched the penny 20 years ago – because it has outlived its usefulness. There are now over 200 billion pennies in circulation – that have a collective nominal value of $2 billion. With inflation on the rise, the penny has near-zero purchasing power.Even so, the penny is still around. Partly because there is a strong emotional attachment to it, but more importantly because production of penny blanks has been outsourced and those vested interests have no desire to see their production go to zero. In addition, the Illinois Congressional Delegation doesn’t want to see the penny go… because their native son, Abraham Lincoln, is on the penny. And no one on Capitol Hill cares enough to fight those interests.Interestingly, it also costs about two cents to produce each penny – so it’s a loss-maker for the U.S. Mint. Moreover, without the penny, the $0.99 prices will have to get rounded-up. But with 75% of all commercial transactions done in electronic form, dropping the penny would have no impact on pricing.Similar logic can also be extended to the nickel – the five cent coin – which isn’t a money loser as yet but has limited use. And as Philip Diehl says, one coin at a time, let’s deal with eliminating the penny before we think of getting rid of the nickel.

Instead Of Toys, Gift Stocks And Index Funds

With Peggy Mangot, former Google Executive and Co-Founder and CEO of SparkGift.comPeggy is a veteran in the consumer financial services industry. Previously, Peggy led strategic partnership management at Google focusing on Google Wallet. Peggy has held senior roles with Visa, PricewaterhouseCoopers, Allianz, and Accenture. She began her career as a financial markets & payment system risk analyst for the Federal Reserve Bank of Chicago.She co-founded a company called SparkGift after repeatedly noticing a common problem among friends and family – the desire to give a meaningful gift that can truly add financial value, without wasting money on meaningless toys and gift cards. So SparkGift empowers people to give gifts – specifically fractional stocks and index funds - that can truly impact their loved ones' lives. Rather than just creating a moment of delight, Spark believes a gift can be a more meaningful, longer lasting experience. And even a small investment gift of $20 can go a long way towards empowering someone's financial future.SparkGift is aimed at people who value savings and investment over consumption and spending – especially to kids who have pretty much everything. So Peggy and her team decided to make it easy and fun to gift investment assets – without the hassle of opening up brokerage accounts, etc. Her company supports 6,000 stocks and funds, lists the most popular stocks and index funds, offers a Gift Registry, and creates digital gift certificates. The process is technology-enabled and significantly easier to setup. And because SparkGift supports fractional shares, gifts could start as low as $20. On top, SparkGift charges a flat $2.95 fee and 3% of the gifted amount that is paid by the gift-giver. After that, the gift receiver has to pay nothing to maintain the account. Moreover, accounts are setup for automatic dividend reinvestment so the account can grow over time. So here’s something else to consider the next time you need to give someone a gift – specially to kids and young adults who could benefit from a nice stock growth account.

Your Next House At 50% Off? The Government Says Yes!

With Terry Story, 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLThe U.S. Department of Housing and Urban Development (HUD) has launched a new initiative called the Good Neighbor Next Door at HUD Homestore. Buying a home through HUD's Good Neighbor Next Door initiative is designed to encourage renewal of revitalization areas by providing an opportunity for law enforcement officers, firefighters, emergency medical technicians and teachers to purchase homes in these communities. HUD provides a substantial incentive in the form of a 50% off the list price of eligible properties, and bids for property must be submitted by a HUD-registered real estate broker.HUD Home Store is the listing site for HUD real estate owned (REO) single-family properties. This site provides the public, brokers, potential owner-occupants, state and local governments and nonprofit organizations a centralized location to search the inventory of HUD properties for sale. In addition, registered real estate brokers and other organizations can place bids on behalf of their clients to purchase a HUD property. HUD Home Store also includes many informative user-friendly features providing advice and guidance for consumers on the home buying process. A HUD home is a 1-to-4 unit residential property acquired by HUD as a result of a foreclosure action on an FHA-insured mortgage. HUD becomes the property owner and offers it for sale to recover the loss on the foreclosure claim. Many of these homes can be fixed to provide good value to buyers.Terry also gives us the Housing Forecast for 2016 – new home construction and moderate gains in the existing homes market should push home sales to a record high in 2016 – so expect a solid year for the housing market – with price gains in the sustainable 3% range, and millennials buying about 30% of it all. Retirees are also expected to buy up a lot of retirement properties. Sales are expected to peak in prosperous job markets.In her Real Estate Survival Guide, Terry talks about down payments… and that it would take 22 years for the average Floridian to save up for a 10% down-payment on an average home… pretty shocking! Terry also talks about whether Neighborhood Watch signs – and says it really depends on how you view it, especially if you only see those signs in a few select neighborhoods – so think positive, don’t be alarmed, and ask a few questions to make sure you’re not moving into an overly crime-prone area.

Baby Boomers Are Holding Up The Market

With Terry Story, 26-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLThis week, veteran Florida real estate agent Terry Story talks about the impact of the Federal Reserve finally raising interest rates and how this modest 0.25% increase might impact borrowers, their ability to get mortgages, and the housing market as a whole. Fundamentally, Terry believes rates are still “so so low” by historical standards that the rate-hike impact is negligible. She believes mortgage interest rates would have to rise close to the 6% - 6.5% level before there is a sizable impact on housing. Moreover, despite super low mortgage interest rates that, if anything, should boost purchases, the housing market is currently being driven more by supply and demand, with limited supply, shortage of inventory, fewer properties for sale and rising property prices. Ideally, Terry wants to see rates rise a little because that might spur buyers to jump in before rates get beyond reach.Terry also attributes low housing inventory to baby boomers - who own about 66% of all homes in the U.S. – and are nearing retirement, are empty nesters but are still not downsizing their homes because they’re waiting to re-build the home equity they lost in the 2008 downturn. Then add their millennial children who are still staying with their baby boomer parents… so there’s a bottleneck in homes for sale.Terry also talks about recent feature additions on Zillow.com with tools that can help you tweak the value of your home based on the home improvements you’ve made, your home’s preferred location, etc. But while this tool is nice, you really want a knowledgeable realtor who knows what comparable properties are really selling for with upgrades and everything else.Terry talks about what renters really look for – not the great club houses – but more contemporary needs such as high-speed Internet, walk-in closets, parking spaces, sound proof walls, in-unit washer-dryers, etc. – and a swimming pool.Finally, Terry talks about the value of a great credit score on your borrowing rate, with discounts of 0.24% to 1.17% on your mortgage per 10 point increase in your credit score. So pay off your bills on time and do all you can to boost your credit score.

Rethinking America’s Approach to Education

With William Deresiewicz, Former English Professor, Author of Excellent Sheep: The Miseducation of the American Elite & The Way to a Meaningful LifeIn his book, Bill Deresiewicz believes our approach to education is wrong with an over-emphasis on hyper-achievers trained to jump through higher and higher hoops while neglecting other facets such as a focus on a well-rounded education that makes our students better prepared for life and career.Bill talks about the insane admissions frenzy and incredible competitiveness to get into a good university – our ticket to the good life. He also talks about the “excellent sheep” – the ultra-high achievers who are always looking for the next step to climb higher. This elite group also tends to overwhelmingly flock to four career buckets – finance, consulting, law and medicine – and form the core of America’s leadership across industry and government.Bill also served on Yale University’s Admissions Committee, and shares his insights from that experience. The admissions criteria were just extremely high and tended to favor students with multiple proficiencies in things like sports, foreign languages, music, art, and, of course, straight-A grades in high school. This focus on super achievement was also brought to light in the satirical book - Battle Hymn of the Tiger Mother, by Amy Chua - that spoke with self-deprecating humor about very strict parenting.But are our educational systems and social values focusing on the wrong vectors and are we missing out as a society? Can we have better leaders by changing the education and admissions process? Can we mold well-rounded leaders by de-emphasizing achievement and allowing people to find their true calling beyond the current top four fields of finance, consulting, medicine and law? Can the admissions process be changed to allow independent, courageous and curious free-thinkers access to the country’s best colleges? How do we make our schools better? And is an online education as effective as sitting in a teacher-led classroom?

Are You Well-Prepared For Retirement?

With Diane Oakley, Executive Director, National Institute on Retirement SecurityWhile most Americans don’t save as much as they should, is the retirement savings crisis worse than we think? Of 38 million working age households, fully 45% do not have any retirement assets at all. And older Americans – between the ages of 55-64 - only have a median of $12,000 in their IRA or other retirement accounts.Diane Oakley’s organization does research on America’s retirement trends and directly knows a lot about our preparedness as a nation for retirement - because she’s been involved in retirement planning, social security and related issues at the highest levels of government. Diane shares some rather shocking statistics on retirement. For example, while most people need a certain multiple of their income to maintain their lifestyles in retirement, 90% of us are grossly behind where we should be on retirement savings, in an era when “defined benefit” plans have been replaced by “defined contribution” plans – so we have no guarantee of the income we’ll have in retirement and are essentially left to sink or swim on our own. Wealthier folks generally tend to be better prepared for retirement with a stable “three-legged stool” that’s made up of an IRA, a 401(k) and a defined benefits plan… but they are in a minority. Most Americans, however, are way behind on their retirement savings – and needs to step up their savings for retirement.Diane shares her thoughts on how much we should save per year to make sure we are prepared for retirement, as a percentage of our income, and the bare minimum we should have (as a multiple of last salary) going into retirement. She also offers tips on savings schemes that are matched by the government and should be taken advantage of so we can all better prepare for a dignified retirement as jobs also continue to get scare for older Americans, specially when economic growth slows.

How Millennials Should Spend and Budget Their Money

With Kerri Anne Renzulli, Reporter at Time MoneyMillennials comprise a generation with a mind of its own, uniquely different from their predecessor baby boomers. They’ve grown up with technology in a more connected world, believe that our Earth is a shared resource, cherish personal freedoms and expect more from the workplace. Millennials also tend to switch jobs way more often – once every two years on average - than generations before them, and tend to place less value on the importance of money. So Kerri Anne, a millennial herself, talks about millennial attitudes towards money, spending and savings, and offers insights on what millennials are doing right or wrong, and how they can better manage their finances for a comfortable retirement.Turns out, millennials live by plastic - debit cards in particular. Find out why it’s easier to spend on plastic than spending hard cash, and how that plays into purchasing decisions but turns out to be more expensive every year. For example, millennials tend to focus more on the benefits of their purchase and overspend when they pay by card, but tend to focus more on the cost outlay when they pay by cash, and are more prudent about their spending. So 11% of all millennials tend to go over their card limits and pay heavy overdraft fees (about $35 per month), and a whopping 44% do not pay their bills in full each month – which, of course, leads to them racking on really expensive, high interest rate debt on unpaid amounts.See what Kerri Anne suggests millennials do to control their spending and manage their finances. While budgets are easy to make in theory, learn how to make realistic budgets and stick with them over the long term, with online tools and apps that make financial budgeting much more manageable.

The Impact Of Technology: A Look At The History And Future Of America

With Dr. Richard Kurin, PhD, Under Secretary for History, Art & Culture at the Smithsonian Institute, Author of Six Books including Hope Diamond: The Legendary History of a Cursed Gem and The Smithsonian's History of America in 101 ObjectsAmericans have always been seekers of innovation, exploration and adventure – it’s in our DNA. This innovation mindset has been central to shaping our nation’s economy, role as global powerbroker and leader, advanced military capabilities, and history and culture – much as it continues to do so today, with the world getting pretty much all of its game-changing innovation from the United States. Dr. Richard Kurin is a prolific author, researcher and maven on the intersection of American innovation history, art and culture, and gives us fascinating insights into how technology has continually reshaped American and global life – economic, military, political, business and civil – in positive and negative ways, predictably at times but more often with unintended consequences.Dr. Kurin believes the invention of the telegraph was a major change – eons before the Internet and technology as we know it today – and transformed the American way of life, just as the Cotton Gin disrupted the cotton economy and inadvertently reinforced cotton production and slavery… with far reaching consequences beyond the original invention or intent. He talks of how the telegraph upturned the world of communication – where each character cost money - and replaced flowery, flowing letters with brevity in our written and spoken words. Similarly, the railroad impacted our western expansion… and hugely impacted global trade, commerce and the exchange of ideas. He also talks about how the radio changed communication, entertainment and political landscapes – with Roosevelt’s fireside chats that brought the president into people’s homes in real time, and saved the banking system from collapsing during the Great Depression of 1929; or how the music and entertainment business models underwent a revolution.Kurin talks about today’s technological innovations with mobile communications and the Internet. He uses historical insights to build a picture on where today’s technological innovation could take us in the future, the value of patents in America’s history, and tells us what really matters for business success beyond the initial invention or innovation.

Can Money Buy Happiness?

Can money buy happiness?Elizabeth Dunn is an Associate Professor in the Department of Psychology at the University of British Columbia in Vancouver, Canada. Michael Norton is a Marketing Professor at the Harvard Business School. And the two of them have co-authored a book titled “Happy Money: The New Science of Smarter Spending.” The book’s main premise is that happiness depends more on how you spend your money than how much you have, and it’s been nicely summarized by Andrew Blackman in an article titled Can money buy happiness? that was published in the Wall Street Journal a few days ago.The connection between money and happinessIn the book, Dunn and Norton describe an experiment where they gave the same amount of money to people in two groups, and told the first group to spend it on themselves and told the second group to spend it on others and (surprise, surprise) the second group, that was asked to give money away, was way happier than the first group that was told to spend money on themselves.The book’s results, at first glance, seem obvious: people with higher incomes are, broadly speaking, happier than those who struggle to get by.But dig a little deeper and the findings get a lot more useful.   Wealth alone doesn't guarantee a good life. What matters more than a big paycheck is how you spend it.Researchers found that life experiences give us more lasting pleasure than material thingsWhen people do spend money on themselves, they are a lot happier when they use it for experiences than for material goods. Researchers found that life experiences give us more lasting pleasure than material things.  Yet people, do the opposite.  They deny themselves experiences and prioritize buying material goods, thinking experiences are fleeting and material goods last longer.When people looked back at their purchases, they realized that experiences actually provided more happiness and more lasting value, while material purchases provided a brief thrill and were then taken for granted.Experiences are often shared with other people and meet more of our underlying psychological needs, giving us a greater sense of social connection. For example, if you've climbed the Himalayas, that’s something you’ll always remember and talk about, long after all your favorite gadgets have gone to the landfill.We also tend not to compare our experiences with other people. Keeping up with the Joneses is much more prominent for material things than for experiential things.A recent research paper called “Waiting for Merlot” shows that we also get more pleasure out of anticipating experiences than anticipating material things. People waiting for an event are generally excited whereas people waiting for material things seem more impatient.Use your money effectively to lead a happier lifeAnother trick to living happier lives is to consciously foster appreciation and gratitude for what you have. Literally count your blessings and don’t take things for granted.Move your material possessions around. For example, if you keep a painting hanging at the same spot on the same wall, you’ll stop noticing it after a while. So swap it with a painting from another room, and you’ll see each of them with fresh eyes, and appreciate them more.Want to get more happiness from the things you own?  Lend something you own to someone else for a while, for their enjoyment .  You’ll find that you appreciate and enjoy that thing a lot more when you get it back.A lot of us think we’ll give to charity one day, when we’re richer, but there are benefits to giving even when people are struggling to meet their own basic needs. What matters more than the dollar amount you give is seeing that your money makes a difference in other people’s lives, even if the amount you gave was quite small.

Do Your Homework To Avoid This Property Rental Scam

With Terry Story, 26-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLNoted real estate veteran, Terry Story, talks about the importance of appraisals when you sell a house, and reminds us that we only need appraisals if there’s a mortgage involved, not if it’s an all cash deal. One in five home sale contracts get delayed over appraisal issues and of that, about 10% fail to go through.Appraisals also have quantitative and qualitative aspects because an appraiser essentially compares the home for sale to similar properties in the neighborhood, and has to make changes for things such as an extra bedroom, a bigger or smaller covered area relative to the neighborhood median, the condition of the house, etc. So some of these adjustments tend to be approximations that are open to interpretation. For example, an appraiser may value an extra bedroom at about $2,500 but the market value of an extra bedroom is significantly higher. So when you see an appraised value, make a few adjustments of your own to reflect how the market might value differences. Additionally, appraisal values on intangibles such as, say, the views from a home, are also very subjective.In her Real Estate Survival Guide, Terry addresses a rental scam where tenants paid the security deposit upfront, moved into an apartment where the owner purportedly lived abroad and regularly paid their rent, only to get an eviction notice a few months down the road because their rental was a bank foreclosed property, a rather common scam that targets foreclosed homes or property owned by persons living abroad. Terry’s sage advice? Always check public property records and do your homework before moving in.If you’re in the market for a newly built home, move quickly because there typically is a lead time of at least three months before you can move in. Moreover, take advantage of still low mortgage interest rates before they start to move up. Finally, if you are selling a “smart” home, make sure you remove all your codes and passwords from the home’s smart devices lest that information fall into unscrupulous hands.

Here’s Your Year-End Financial Checklist

A few days back, my primary care doctor’s office sent me a reminder to come in for my annual physical exam.  You know, the one where they check you out just to make sure everything’s humming along as it should and to make sure you’re doing all you can to stay in good health for the next 12 months.on your annual financial checkup, take stock of your financial health.  Consider how you’ve progressed towards financial goals and how well you’re positioned for future financial success and prepare a budget for spending, savings, and investments in the year ahead.Along the same lines, as a financial adviser, I urge my clients to take stock of their finances regularly, ideally every month or every quarter, but definitely at least once a year. Think of this as your annual financial checkup where you take stock of your financial health, how you’ve progressed towards your financial goals and how well you’re positioned for future financial success.  And then prepare a budget for spending, savings and investments in the year ahead.This financial health check will give you peace of mind, keep you on-track to achieving your financial goals and protect you in times of adversity. It will also serve as a gentle motivator that gets you to think twice before spending frivolously and guide you toward staying on top of your savings and retirement goals.So today I plan to talk about the things I’d like you to think of as part of your annual financial checkup.  Let’s get started. Estate Documents:Some of you may have heard the urban legend about the guy who got divorced and remarried and then accidentally left millions to his ex-wife when he died because he forgot to change his beneficiaries. The problem is, this isn't a myth. These things can and do happen, more often than you might think, as Jennifer Woods of CNBC points out in a recent article.A year-end financial checkup also helps you make sure your important documents are in order, reflects your wishes, and you are up-to-date with major life changes such as marriage, birth, or divorce. These are documents such as your last will and testament, health-care proxy, and power of attorney. Your estate planner should make sure these documents are updated to reflect any recent changes to state or federal laws.Designated Persons:Another aspect of these documents is making sure that the people you've appointed to handle various things like your estate, medical decisions on your behalf or acting as guardians if you have minor children are still alive and capable. Furthermore, situations and relationships often change, so someone who may have once been appropriate may no longer be the right choice. For example, people often list their parents as guardians of their children, but parents age or get sick or disabled and are often not in a position to act as guardians.  Make sure you’re comfortable with your choice for appointees, and talk to them every year about how you’d like them to manage your affairs.  Don’t just rely on documents because written words can be interpreted differently and could lead to actions you may not want.  It’s always a good idea to have that talk and to let your appointees know they’ve been nominated.  Ask them if they’re still willing to play the part and tell them how you’d like your affairs handled. It’s also a good idea to record these conversations so they be referred back to or presented should disputes arise.Now is also a good time to add or check who you’ve listed as beneficiaries for things such as life insurance policies, retirement accounts, CDs, savings or brokerage accounts. If a beneficiary isn't named the asset will pass through your estate and be distributed based on the terms of your will.Here’s another thing.  Our nation is one of immigrants who’ve come from abroad,

Barbara Corcoran On Achieving Your Dreams

With Barbara Corcoran, Businesswoman, Entrepreneur, Investor, Author of Shark Tales: How I Turned $1000 into a Billion Dollar BusinessBarbara Corcoran is best known as one of the “sharks” on ABC’s hit show Shark Tank where Barbara competes with other so-called sharks to invest her own money. Barbara's story is an inspiring rags to riches tale, turning a thousand dollar loan into a multi-billion dollar real estate empire in New York City, competing and winning against the big bad boys there.In her second appearance on On The Money, Barbara Corcoran opens up about how life changed after she sold her business, made a fortune and achieved the quintessential American dream but then woke up grumpy every morning. She realized that she missed getting up and going to work doing something she loved.  So she decided to jump back into business doing what she was great at, creating a media brand which she attributes to the successful sale of her first business. Things didn’t go her way until she ended up getting a gig as a political consultant on Fox News that led to The Today Show and finally to Shark Tank.She also talks about the worst pitches she’s heard on Shark Tank (which are too many to count) and about the deals she missed and regrets. She also talks about the "On Deck" contest.  "On Deck" is an online lender that organized a contest with $10,000 going to each of the entrepreneurial winners. Barbara is tough as nails, wonderfully down to earth, and follows her gut instinct on how to surround herself with winners and stay ahead in life.

Watch Out When Buying Long-Term Care Insurance

With Howard Schwartz, founder Schwartz Family Home CareOver the years, Howard has developed significant expertise in long-term care insurance and the claims process, a field he believes is misunderstood. Conceptually, long-term care insurance is presented as this big idea to protect buyers from the high costs of long-term care with a sales presentation that lists out all the great features that the insurance offers. But there is a disappointing reality of what really happens when you go to use the policy.Howard has seen policies change significantly over time because insurance companies have lost a lot of money on these policies in years past. For example, they’ve eliminated life-time unlimited benefits (only finite time policies) and policies have become tax qualified which means that the insurance kicks in only if your long-term care exceeds 90 days. The trigger is far more stringent than when policies would pay for as little as a week of disability. Many companies see these policies as money losers and have stopped offering them so consumers now have fewer choices.Typical benefits are about $100 per day of care and up to $200 per day for live-in care. Howard says you’re generally fine with 3 years of care but the biggest hurdles today are getting the paperwork together (about 10 days) and getting the companies to sign-off on benefits after they evaluate the claim. Even if you have the policy, coverage is not guaranteed, and everything depends on the insurance company approving the care.In cases like these, it’s very important that family members have power of attorney to make medical decisions when crises happen. It’s important to have your documents on hand and to be prepared ahead of time, because the complex process of insurance companies can take weeks at the very least.

More Millennials Head Back to Parents’ Home

With Terry Story, 26 year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLTerry updates us on real estate sales in the U.S.  She says the Pending Home Sales Index has essentially stayed flat in the month of October, which is unusual after two straight months of declines. She attributes this to a shortage of inventory which makes it harder to sell more homes. Surprisingly, the Northeast saw the most dramatic price appreciation and constraint on sales than any other part of the country.Flat October sales are also surprising because interest rates were at all-time lows, the U.S. economy was doing well, unemployment was down and mortgages were easy to get, often with as little as 5% down for home buyers with good credit.Terry also discusses the impact of new mortgage rules.  Realtors had a year to prepare for this new “3-day rule” and now work a lot harder to close a sale.  The good news is this hasn’t really slowed down the home buying process in any discernible manner and is a win for buyers because it offers a lot more transparency. Moreover, as realtors get used to this new process, things should get a lot easier under the new rules.And here’s a surprising bit of new census data: More millennials now live in their parents’ house than during the Great Recession of 2008.  31% of those between the ages of 18 and 34 now live with their parents, up from 27% a decade ago. Rising prices have also cut down on first-time home buyers because of higher down payments.In the “Ask the Real Estate Pro” segment, Terry touches on “not cutting corners on permits”.  A home owner wants to put a shed in his backyard but the permit process is stalled because the city is concerned over a setback.  This is the space you need to leave between your boundary and any construction, perhaps due to utility easements, etc. Terry also says that despite the added time and cost, people should get their permits in place, especially if it’s about adding to the property.  Not only will this keep the city from asking you to tear it down, it will also enhance your property value. Do not bypass the permitting process.Another listener’s question is about a branch from a neighbor’s fruit tree hanging over the fence, dropping fruit and attracting pests. The listener has repeatedly asked the neighbor to cut the branch, but the neighbor refuses. Terry’s advice is to send a written note to the neighbor, and then trim that branch in a manner that causes no damage to the tree. The same applies to roots, but it’s better to consult an arborologist before whacking an axe at it! 

The Mad Hatter Would Love Todays Negative Interest Rates

The Federal Reserve’s monetary policy and interest rate s etting body, t he Federal Open Market Committee or FOMC as it’s generally called, i s set to meet for two days this coming Tuesday and Wednesday. And virtua lly everyone that follows the Fed believes the committee will hike interest rates by 25 basis points or  by 0.25% at  next week’s meeting, with an announcement due on Dec. 16, 2015. This would be the Fed’s first interest rate hike—seven years to the date f rom December 16, 2008, when the Federal Reserve cut rates to rock bottom. So rates in the U.S. will finally rise just a tad  above their near  rock bottom levels and will then flow  into most of our financial transactions such as interests paid on deposits or charges against borrowings. Higher rates in the U.S. will also boost the attractiveness of the dollar , which has recently risen to record highs against many foreign currencies, on the near certainty of a rate hike next week.in some developed countries in Europe, interest rates are less than zero… and offer a window into what might happen down the path of negative ratesBut get this:  There  actually are developed countries in Europe where interest rates are less than zero. That’s because  European Central Bank pushed down its deposit rate—what it pays commercial banks—to minus 0.3% from minus 0.2%. And, in response to the ECB’s rate cuts, three of the Euro Zone smaller neighbors (Denmark, Sweden, and Switzerland) pushed their interest rates deeper into negative territory, resulting in a number of unusual outcomes with ramifications for big businesses, consumers, and everyone in between. These countries offer a window into what might happen if the eurozone travels farther  down the path of negative rates.So, for example, the Swiss National Bank now has a deposit rate of minus 0.75%, and it’s only fair to wonder what this all really means.The Bizarre Implications of Negative Interest RatesFor one, the money you hold in the bank will pay you no interest. On the contrary, banks now charge you to hold your deposits. Sounds  strange, doesn’t it? It just seems to up-end the whole concept of banking that we’ve grown up with, where banks would compete to get you to open an account and incentivize you to deposit and invest more of your money with the bank.But that’s apparently not the case anymore, at least in a select few countries, Tommy Stubbington writes in an article in The Wall Street Journal. He reports that Danish companies now pay their taxes early.  Why? So they can rid themselves of the cash they hold.But there’s also a rather bizarre and attractive flip side to this negative interest rate scenario. In a nutshell, it’s where banks pay you to borrow money from them. Sounds too good to be true, doesn’t it? Turns out, that’s just the case in Denmark. Instead of charging interest on home loans, Danish banks now send monthly payments to people who borrowed from the bank to buy a home... like having your cake and eating it, too!Such is life in the upside-down world of negative interest rates, in which banks impose a levy on customers to hold their money, instead of paying interest on deposits.I’ve checked all my textbooks, and a scenario of negative interest rates just wasn’t supposed to happen. In economics, zero is the floor. But Europe’s economic stagnation has proved so long and intractable that the region’s central banks are cutting interest rates to spur their economies. I guess their logic is if it helps to move rates from 1% to 0.5% and from 0.5% to 0%, why not try minus 0.5%?Negative Interest Rates Could Have Economic BenefitsWhile Europe’s negative rate adventure has only just begun, it is far from clear how it will end. Now, just as the dollar has strengthened on a pending rate hike, the ECB’s negative deposit rate has helped bring down the value of the euro,

For Great Deals, The Best Time To Buy Is After The Holidays

With Andrea Browne, Online Editor at Kiplinger.comAlthough the Christmas shopping season is almost over, Andrea Browne believes it’s not the end of the best times to buy things, and tells us that we could still score some pretty juicy year-end deals.She starts by telling us not to get taken in by all the aggressive deals in the run up to Christmas. Instead  we should  hold off until after Christmas – perhaps the best time to buy - when a lot of good deals get even better, as retailers look at clearing out their inventories. For example, retailers know that families often get together over the holiday season and may be looking to buy bedding items – sheets, pillowcases, comforters, etc. But hold off, because these items go on deep discount right after Christmas.Another example is gift cards.  Because a lot of people procrastinate their gift buying, and then settle for gift cards as the easy way out, and they often buy more gift cards than they need. Then  after Christmas, they hop online to sell their extra gift cards for 15% off or more, at sites such as CardPool.com and CardCash.com.  So that’s virtually cash sitting on the table.Another obvious item is exercise equipment. Generally people set their fitness goals before the New Year and don’t want to miss out on the great bargains. Well, retailers know there is this seasonal pre-New Year demand, and so they offer incredible deals around Thanksgiving and early December. But, the best time to buy, again, is after Christmas – more specifically, after New Year when exercise equipment gets discounted by about 50%.Cruise operators also cash in during the holiday season, so January through March is often a better time to go on a cruise. Andrea lays out many other ideas on how people can save a lot more by simply holding off until the demand dies down – kinda like Warren Buffett’s approach to buying stocks!

The 2016 Money Guide Is Here

With Jonathan Clements, Financial Writer, Author of Jonathan Clements Money GuideJonathan spent almost 20 years at The Wall Street Journal, where he was the newspaper's personal finance columnist. Between October 1994 and April 2008, he wrote 1,009 columns for the Journal and for The Wall Street Journal Sunday. He then worked for six years at Citigroup, where he was Director of Financial Education for Citi Personal Wealth Management, before returning to the Journal for an additional 15-month stint as a columnist. He's the author of the award-winning Jonathan Clements Money Guide and is currently working on a new book, How to Think About Money, which is slated for publication in September 2016. He also puts out a free newsletter every few months.His Money Guide helps investors build their own financial plans in 18 easy steps, provides updated tax guidance, financial dos and don’ts, facts and figures on the economy and the markets, and other interesting tidbits on a wide range of financial topics, such as retirement.His book was meant to demystify finance and share commonsense, easy to implement strategies when handling their money. He also talks about working part-time in retirement, generating income in retirement, and how that really goes a long way towards managing daily expenses while also keeping you mentally occupied. He also addresses the pros and cons of buying a fixed annuity, and how your annuity decision should be tied into your health and longevity prospects, and factor in inflation.  He also suggests diversifying your annuity across multiple underwriters, as you  diversify your asset portfolio.He also talks about his portfolio allocation to sail through the next 25 years of retirement, at least. One of his strategies is to  n to five years of cash or equivalent of daily expenses to see you through as much as a five year slump in the market, so you don’t cash out when stocks are down and have the wherewithal to ride out market bottoms. Jonathan also talks about diversifying some of his portfolio through global diversification, especially when U.S. stocks appear to be more pricey than foreign issues. Finally, he addresses the benefits and myths of home ownership, and financial dos and don’ts going into 2016.

The Risks And Rewards Of Investing In Tax Free Bonds

With Scott Colyer, CEO and Chief Investment Officer at Advisors Asset ManagementWith over 28 years of industry experience, Scott Colyer has become a highly respected fixed income strategist and investment counselor on tax free bonds and other investments. He takes a truly strategic approach to portfolio management by focusing on macro and micro economic trends to navigate complex market cycles. His insights on municipal bonare  requently featured on several leading financial media outlets, including The Wall Street Journal and CNN Money. He has been CEO and Chief Investment Officer of AAM since 1998.Scott talks about the municipal bond market, which has several (not all) tax free bonds where local investors do not pay taxes on interest earned.  With the U.S. economy improving across the board, Scott notes that municipal issuers have become stronger with a bounce back in tax collections and a vibrant economy that generates cash for municipalities to pay off their bond debts. And that’s good news for income seeking investors, especially those inclined to safer, more conservative, and less volatile investments – investments in school districts, utilities, etc.Scott also believes investors should do their research before they buy, because sometimes (less than 1% of all issuers) municipalities tend to over-borrow in a declining tax and services revenue environment and get themselves and their bond holders in trouble. For example, Puerto Rico appears to have dug itself into a hol e with over borrowing, and will likely have to reach some settlement that will not deliver full principal to bondholders.Scott also addresses some bonds that are insured, which are, of course, safer for investors. But investors likely pay a slight premium for this additional safety,  and that’s actually worth it because the guarantee of principal and interest returns makes these bonds lose less value and are more liquid (easier to buy and sell). So, overall, municipal bonds provide tax benefits and are safer investments. Scott also walks us through basic bond math, helps us understand the impact of interest rates on bond values, and how individuals can invest in municipal bonds.

Why Millennials Have Stopped Buying Homes

With Terry Story, a 26 year veteran with Coldwell Banker located in Boca Raton, FL.  For more about Terry Story go to terrystory.comTerry updates us on the housing recovery’s “missing link”, and what she’s alluding to is the drop off in millennial homebuyers. In the past, millennials have accounted for about 40% of first-time home buyers each year, as they settle down, marry, have children, and look to buy a home. But the number of millennial buyers is down sharply this month – to just 32%. She believes this is due to factors such as student loans, rising rental costs that cuts down their savings for a down payment, etc. So most of the buyers now are move-up buyers who have built-in equity that they transfer from one home to another.And while homes are not the best long-term investment (Warren Buffett did not get rich buying and holding homes for the long run), owning a home keeps you at par with other homes, which is another way of saying that your home price rises with your neighborhood, and this accumulation of home equity—where you pay down your mortgage monthly and see home price appreciation—gives you the freedom to relocate and buy another home. By comparison, renters do not see any equity buildup effects from their rental payments and need to have other backup sources of income to keep paying their rents.Additionally, how do you choose which home to buy in a neighborhood you like? Do you necessarily forego buying an expensive house for something that’s less pricey, or are you better off buying a more expensive home? According to Terry, the least expensive home will see the most appreciation—partly through remodeling—that could deliver a significant upside in home value.Should homebuyers talk to banks or specialist mortgage lenders? Turns out, mortgage lenders have a wider basket of products that can better suit your financial constraints, often at a lower mortgage rate.Finally, Terry answers a listener’s question about living in a townhouse that shares a wall with a house that has a rat infestation problem. Terry suggests first checking with your homeowner’s association which is often responsible for common walls or writing to the absent neighbor to let him know there is a rat problem, or,  if all else fails, treating the infestation and getting/suing the HOA or the neighbor for their share of the expenses.----

Mark Zuckerberg And His $45 Billion Gift Are Under Fire

This past Tuesday, on December 1, Mark Zuckerberg, the co-founder and chief executive of Facebook, and his wife, Dr. Priscilla Chan, publicly shared a letter they’d written to Max, their one-week old newborn daughter. In that letter, the couple pledged to give 99 percent of their Facebook shares to charitable causes through the course of their lives. With Facebook’s market valuation at about $300 billion, the Zuckerberg amounts to about $45 billion. Wow!!! That’s one generous commitment to charity. and my hat is off to them several times over for making such an amazing commitment.Mark Zuckerberg’s charitable plans are the latest indication of a growing interest in philanthropy among Silicon Valley’s young billionaires, who appear eager to spread their wealth while they are still young.Mark Zuckerberg’s charitable plans are the latest indication of a growing interest in philanthropy among Silicon Valley’s young billionaires, who unlike previous generations of business tycoons, appear eager to spread their wealth while they are still young. Mark Zuckerberg is 31 and his wife, Priscilla Chan, is 30. They wrote, “Our initial areas of focus will be personalized learning, curing disease, connecting people, and building strong communities. We must build technology to make change. Many institutions invest money in these challenges, but most progress comes from productivity gains through innovation. We must participate in policy and advocacy to shape debates. Many institutions are unwilling to do this, but progress must be supported by movements to be sustainable.”In a securities filing, Facebook said Zuckerberg planned “to sell or gift no more than $1 billion of Facebook stock each year for the next three years.” And he intends to retain his majority voting position in the company’s stock for the foreseeable future.Zuckerberg also frequently says he’s been hugely inspired by Microsoft co-founder Bill Gates - one of his childhood heroes for his zeal in building Microsoft into a colossus in the technology industry, and for reshaping personal philanthropy through the Giving Pledge, an initiative started by Bill Gates and Warren Buffett to get wealthy individuals and their families to give away more than half of their wealth to charities during their lifetimes or after. Bill Gates, by the way, has pledged to give away at least 95 percent of his $85 billion net worth.Giving Through Limited Liability Corporation Draws Mixed ReactionsWhat’s also interesting is how they chose to structure their giving.  In the letter, the Zuckerbergs said they were forming a new organization, the Chan Zuckerberg Initiative, to manage the money through an unusual limited liability corporate structure. They have not yet detailed how the money will be spent and the pace at which the money will be given out, but there’s enough time for that. For now, what matters most is the commitment they have made to supporting great causes.By using a limited liability company instead of a nonprofit corporation or foundation, the Zuckerberg family will be able to go beyond making philanthropic grants. They will invest in companies, lobby for legislation, and seek to influence public policy debates, which nonprofits are restricted from doing under tax laws. And any profits from the investments would be plowed back into the Chan Zuckerberg Initiative for future projects.With an LLC, donors have the ability to invest politically, in the for-profit sector and the nonprofit sector simultaneously. An LLC, for example, can spend money on political ads. A tax-exempt nonprofit can't. And an LLC could make angel investments in clean energy startups in a way that a tax-exempt nonprofit can't. But an LLC can also make donations to tax-exempt nonprofits and thus reap the tax benefits of charitable giving. So today’s giving is strongly influenced by a desire to actively influence change through philanthropy.In addition,

What’s In Store For The Wealth Of Future Generations ?

With Dr. James Grubman, Author of the forthcoming book: Cross Cultures: How Global Families Negotiate Change Across GenerationsDr. Jim Grubman of FamilyWealth Consulting is an internationally recognized educator in the multidisciplinary field of family wealth psychology. He works with affluent families and their advisors to understand the many ways that wealth and life can be integrated successfully across current and future generations.He talks of the ground-breaking research that classifies the world’s cultures in three categories: the individualist culture that’s mostly associated with the West (Europe, North America and Australia) and is focused on individual needs, assertiveness, self-sufficiency, etc.; the collective harmony culture that’s mostly found in East Asia, China, Hong Kong, and Japan, which emphasizes the family and maintaining dignity in a social environment; and the honor culture that exists in India, the Middle East, Latin America, Russia and Eastern Europe, tribal cultures which have a heavy focus on maintaining family honor and functioning above individualism.As globalism increases, cultures start to clash and challenge each other’s mores, especially in future generations, and Jim helps families frame such clashes to resolve such issues by focusing on shared interests to come to compromise solutions. Both generations need to give and respect the other’s perspectives and attitudes for harmonious living.Using skills developed as a psychologist for over 35 years, Jim helps individuals and families work through the natural dilemmas of acquired or inherited wealth. He contributes thought leadership to many areas of wealth psychology, family enterprise governance, and wealth management to promote understanding of what individuals, couples, and families need as they become successful. His goal is to help those with good fortune achieve their greatest potential.His book explores the similarities between newcomers to wealth and the journeys of immigrants to new lands, and outlines key steps families must take in raising well-balanced, responsible, and strong inheritors.

Is It Possible To Beat the Market?

With Frederik Vanhaverbeke, Bond Portfolio Manager at KBC Asset Management, Author of Excess Returns: A comparative study of the methods of the world's greatest investorsFrederik Vanhaverbeke has parlayed his analytical smarts into developing his own technique on how to beat the market. He’s not your typical MBA that’s now in the world of finance. Instead, he holds a PhD in electrical engineering in 2005. Over the past decade, Frederik has built considerable expertise in the areas of stock investing, company analysis, accounting, etc., through the reading of hundreds of books, articles, shareholders' letters, etc. in his free time. And his thorough knowledge of best practices in the field of investing has helped him beat the market by a substantial margin over the past ten years. Currently, he is employed as a bond portfolio manager at KBC Asset Management in Belgium.In his book Excess Returns, Vanhaverbeke analyses the investment approach of the world's top investors (Warren Buffett, Benjamin Graham, Anthony Bolton, Peter Lynch, Charles Munger, Joel Greenblatt, Seth Klarman, David Einhorn, Daniel Loeb, Lou Simpson, Prem Watsa and many more)  and shows how to achieve market-beating returns.In conversation with Steve, he candidly shares his current thoughts on the market. He believes stocks in the U.S. are expensive with high valuation multiples, as they are but to a lesser extent in Europe. As a result, he’s increased the cash weighting in his portfolio and advises investors to sit still and wait for opportunities to come along. Reflecting on stock market selloffs in emerging markets in 2015, he believes we are at the beginning of a really serious crisis in emerging markets that could be triggered by a conclusive slowdown in China’s economy. On the prospect of rising interest rates in the U.S., he sees positives and negatives.To beat the market, he looks at investments in companies such as Berkshire Hathaway. He also likes to put his money where other smart investors are going. He also recommends Index Funds for people that do not have the analytical skills or the time to study the market and pick companies, but suggest Index Fund investors understand the market so they don’t go in at the top.

S&P 500: The 2016 Market Outlook

With Barry Ritholtz, Founder and Chief Investment Officer of Ritholtz Wealth ManagementBarry Ritholtz is the founder and chief investment officer of Ritholtz Wealth Management, a financial planning and asset management firm with over $175 million in assets, including investments in the S&P 500. Ritholtz writes a daily column for Bloomberg View and a twice monthly column on Personal Finance and Investing for The Washington Post.Barry lays out his views on U.S. economic strength and why, despite its strength, a lot of people aren’t all too happy with the economy. He believes people need to focus on how nicely the U.S. economy has recovered after a major financial crisis and in a fairly short period of time. But he does believe this has been a lumpy recovery, with parts of the country with vibrant sectors - such as Seattle, San Francisco, New York, Boston, D.C. and regions with manufacturing and farmland roots – having recovered nicely, while others continue to struggle. His data also shows that people with good educational backgrounds have bounced back nicely relative to those without a college degree that continue to see challenges with jobs and wage growth. So two factors – your industry sector and your education level – influence your economic bounceback.He talks about the tremendous advantage of having ultra-low interest rates, and how that’s aided our economic recovery. For the most part, he doesn’t see the impending rate hike as overly significant for savers in the near term. Barry also puts today’s low interest rates into perspective relative to 16% bonds in decades past.Barry also lays out why people don’t outperform the S&P 500 or other benchmark funds – because they’re off chasing whatever is “hot” at the time and ignore markets that are beaten up. He also sees stocks as expensive in the U.S. relative to Europe and emerging markets, and believes this may be a good time to diversify your portfolio. And while he’s wary of making predictions, he believes the U.S. economy is on the right course and is gradually strengthening, so he does not anticipate a major crash anytime soon unless extraneous factors kick in.

Know the Ground Rules Before You Buying Your Next Home

With Terry Story, 26-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLAfter a solid 2015 year-to-date, Terry tells us that the housing market is still going strong, with a shortage of good homes for sale and continued low interest rates that continue to drive prices higher, especially in choicer neighborhoods. Median home prices continue to rise, with a 5.5% year over year gain in the median price of $229,000 across the U.S. in the third quarter of 2015. But she also sees a bit of a slowdown taking place, which she views as good for the market in the long run so prices don’t go through the roof and create a bubble. Cities in California and Hawaii continue to top the board, with strong price appreciation in San Francisco, San Diego, Santa Ana, and Honolulu. Cities in the Mid West – Ohio, Illinois and other states - have seen the lowest appreciation. But the fastest home price appreciation in 2015 was in Terry’s turf of South Florida, where there has been solid job gains, little new construction, and foreign investments.First time home buyers are being forced into buying a home faster than they may want to. Normally, millennials make up about 40% of first time buyers, but this number dropped to 33% in 2014 on high education loans and lifestyle choices such as the desire to settle down first and marry later in life.  However, with rental rates rising faster than home appreciation and with interest rates still low, they see home buying as a better investment option.Terry also talks about some good news for first time condominium buyers. New FHA rules now allow more homes to be FHA-approved, so buyers don’t have to cough up higher down payments.In her Real Estate Survival Guide, Terry helps buyers become savvier, to better understand the negotiating process and the rules of the game. For example, sellers are under no obligation to disclose that they have other offers or to enter into discussions with the first bidder on a house. So offering full price or paying in cash is not a sure bet. And counter offers only hold if they are in writing, so skip verbal and have offers signed by all parties. Also, once the seller accepts the contract in writing, there is no backing away. So look to your agent to understand the rules of the game before you get into the housing market.

From Average Joe To Millionaire: Retire Comfortably With Millions

How To Retire Comfortably With MillionsA friend of mine recently sent me a video clip from Yahoo! It was a pretty simple clip and yet very powerful, so I thought I’d share it with you. The video featured two down-to-earth regular guys who spoke in simple terms about how much they earned and what they did to retire comfortably with millions in their bank accounts.DougThe first to speak – Doug Nordman, age 53. Doug and his wife spent 20 years in the U.S. Navy. Doug’s salary peaked at about $88,000 per year before he retired in 2002. His wife’s salary peaked out at about the same number – so together, these two were making pretty good money while saving as much as they could… and in their 30s, Doug and his wife realized that their savings were pretty substantial and were growing fast enough to almost replace their incomes.Doug says his financial freedom came from saving a high percentage of their income or, as he puts it, “we tried to save as much as we could”. Most of the time, they’d reduce expenses and save over half of their income, and invest it regularly in “pretty much the boring mutual funds, index funds, exchange-traded funds that everybody should use for their retirement. Nothing special.”As Doug prepared to retire from the Navy, in 2002, his investment portfolio had grown to a few million - and could support him and his wife without them having to take up civilian jobs.Today, Doug and his wife live in Hawaii where he spends his time surfing and completing do-it-yourself projects around his home.Doug says he and his wife have a lot of frugal habits that make them big savers. They plant a lot of fruit trees in their yard and have fresh fruit year-round, partly because the growing climate in Hawaii is really good year-round. They also do things like composting green waste and buying things second-hand from places like Craigslist and Goodwill, where –as he puts it - “you're effectively recycling possessions that other people don’t want anymore, and you’re getting them for yourself at a much cheaper price than if you bought them new.”He’s also chronicled his journey to early retirement on his web site, The-Military-Guide.com – it’s a pretty impressive website that offers all kinds of advice to military personnel… on finance, savings, loans, etc., … with general interest articles that we could all benefit from, so check it out.RayThe second person on the video clip - Ray Hinchliffe, Jr. Ray is now in his late sixties… and started his career started as a food clerk at A&P earning just $67 a week; he then shifted to Safeway, where he stayed for the next 30 years and moved up to Store Manager, making over $100,000 a year.Ray found that the best and easiest way to save was by putting money away every week and every month from his regular paycheck and taking advantage of 401(k) plans and stock plans where the company would match the money he put into retirement or buying Safeway stock.Ray says there were lots of things that he “wanted” but not a lot of things that he “needed”. To him, a used car did the same thing as a new car, and saved him quite a bit of money. Ray and his family would also save on vacations by going with other couples and splitting the bill, and – he says - that added-up significantly towards their savings.Ray built a sizable nest egg – now several million dollars - under the guidance of his financial advisor, primarily through disciplined saving and following through on a simple plan with regular investments. He says one of the best things he did for his finances was purchasing a home as soon as he was able to. Today, Ray owns multiple properties and says he’s happy with a relaxing retirement.So here’s their advice for people who want to retire comfortably.stay on course with your investing aims. It’s like a boat. You set a course. If you have a good plan and you follow it, you’ll succeed and your investing will definitely pay a huge dividend.

How Lunch With Warren Buffett Can Change A Guy

With Guy Spier, Investor, Author “The Education of a Value Investor: My Transformative Quest for Wealth, Wisdom and Enlightenment”Guy Spier is a Harvard MBA who shot to fame in June 2007 after he bid $650,100 with Mohnish Pabrai for a charity lunch with Warren Buffett. Spier manages the Aqua Marine Fund that is inspired by and styled after Buffett’s investing philosophies.In a fairly candid interview, Zurich-based Guy Spier talks about how his Oxford and Harvard education may have hindered him, more than helped him. Success at business is more about evaluating people, knowing how to say no in the right situation, learning how to fail gracefully, etc. And why, perhaps, a bottom-up job at McDonald’s may have better prepared him for the world of business and entrepreneurship with skills that are needed to navigate the various twists and dilemmas of real life and business. See why Guy wants people to experience what he calls “bad ponds” in life and what made him the famed investor he is today – based on his experiences of coming from the pristine world of academia at elite schools to the bumpy and less than upright rough-and-tumble world of business.He talks about picking up a book titled “The Intelligent Investor” with a foreword by Warren Buffett, and how this gave him a moral compass and put him on a path to success. He also talks about his lunch with Warren Buffett and what Warren said that really changed Guy’s approach to life, investing and building his own company. He also talks about meeting Mohnish Pabrai, another immigrant, who, too, modeled his investment fund on Warren Buffett – and that common thread led to a chance meeting that grew into a lot more. He, in fact, believes Pabrai changed his life way more than his one-time meeting with Buffett.He talks at length about his lunch with Buffett, how Buffett shaped Berkshire into an entity that reflects his personality, and how that gave Guy the inspiration to build a company that aligned with the core of his own philosophies.

Can A Utility Rip Out Your Fence And Not Pay for Repairs?

With Terry Story, 26-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLGetting a mortgage and how companies look at your credit history is pretty antiquated… but there’s change on the way… the new system will look at “trending” data with payment frequency and more relevant data – especially for younger borrowers with limited data history - that would help lenders make better decisions about the credit worthiness of borrowers – hopefully making the system safer over the long run.Terry talks about the changing mindset of consumers. For example, adapting building design to tenant use in ways that are more practical to how business is done today. She also talks about how cities are beginning to think about things like driver-less cars and the culture of sharing, and how that would change city planning,She also tells us why we have to fill out so much paperwork when we apply for a mortgage… basically because banks want to stay in the lending business, and not get stuck with collateral property.In her Real Estate Survival Guide, a listener received notice that a utility wants to rip-up his fence and lawn, and wants to know if that’s legal. Terry’s response… when you buy a house, it comes with easements so utilities can service their assets; those are areas that home owners should not build on. If they do, the utility has every right to rip out the fence and access their easement, without having to pay a dime to the home owner for that new fence. 

Barbara Corcoran Tells How She Turned $1000 Into A Billion Dollar Business

With Barbara Corcoran, Businesswoman, Entrepreneur, Investor, Author of Shark Tales: How I Turned $1000 into a Billion Dollar BusinessBarbara Corcoran has become somewhat of a household name as one of the “sharks” on ABC’s hit show, Shark Tank, where American entrepreneurs pitch business ideas for capital investments by the sharks, who spend their own hard-earned cash on the deals. On Shark Tank, Barbara has invested her own money into about 32 businesses after successfully beating out the other sharks on those deals. Barbara is an active columnist, a guest business speaker, a business consultant, and hosts "The Millionaire Broker with Barbara Corcoran" on CNBC.Barbara Corcoran’s credentials include straight Ds in high school and college, 20 jobs by the time she turned twenty-three, and how she became a multi-millionaire. She graduated with a degree in education in 1971. After graduation, she taught school for a year, but soon moved on… working various jobs including a side job renting apartments in New York City. She wanted to be her own boss, and in 1973 co-founded a real estate business called The Corcoran Group with her boyfriend, who fronted a $1,000 loan. In the mid-1970s, she began publishing The Corcoran Report on real estate data trends in New York City. In 2001, Corcoran sold her business for $66 million. Later, in 2014, she and Phil Nadel co-founded Barbara Corcoran Venture Partners, an early-stage investing syndicate.In her conversation with Steve, Barbara talks about what it takes to succeed as an entrepreneur, what venture investors look for in entrepreneurs and who her favorite sharks are on the show. She also talks about her newest book, Shark Tales, and takes us behind the scenes of her life, her business and her ‘seen on TV’ venture capitalism. Barbara is famously brash and blunt, bold and courageous, and a brilliant identifier of opportunity and talent (often invisible to others). She talks about her rags to riches story, her underdog status, how she gradually built a business empire, how tough it is to build a business, and what it takes to succeed. She also talks about her involvement in the On Deck contest that encourages budding entrepreneurs.

5 Smart Year-End Financial Moves to Save More in 2016

2015 is almost drawing to a close, with the S&P 500 up just about 1% or so year-to-date – it hasn’t been such a good year for stocks – with a fair amount of volatility and a sharp drop in mid-August that sent markets reeling… but, thankfully, markets recovered and were up a very solid 8.3% in the month of October alone… but, as one of my guests (Sam Stovall, Managing Director of U.S. Equity Strategy at S&P Capital IQ) reminded me just last week, after the strong rally in October, don’t expect more than modest market gains in November and December, statistically speaking… no one knows for sure, of course.And with presidential elections due in November 2016, you’ll be happy to know that - since World War II - the S&P 500 has been up 6% on average in each election year… so, with some luck, 2016 should look good for stocks… and as goes January, so goes the rest of the year – so all eyes will be on how markets perform in January 2016.Here are five year-end financial moves that can improve your finances and increase the odds of your portfolio doing well in 2016But without relying too much on the vagaries of the market, Bloomberg’s Suzanne Woolley has highlighted five year-end financial moves that can improve your finances and increase the odds of your portfolio doing well in 2016.#1 Check your mixSo… as I stated earlier, 2015’s been a pretty volatile year for the markets… and this volatility could have messed up your portfolio mix. So before the year ends, I want you to take a careful look at your portfolio, 401(k) investments, etc. to see if they are aligned with your long-term investment goals. I also want you to carefully look at your target-date funds, if you have any – these are funds that automatically rebalance your holdings between asset classes as you get closer to your retirement date – and check to see if they are in need of any tweaking.Now… Why check something that's on autopilot, you might ask… Well, first, because I am surprised by how many people just don't know how their target-date funds are invested and what they will likely deliver as they approach retirement. And, second, because I want you to understand the different fund types you hold to get a sense of your portfolio’s equity risk.For example, T. Rowe Price’s 2025 Retirement fund has 71 percent invested in equities now, with 10 years until the date its holders plan to retire. Another fund - the Wells Fargo Advantage DJ 2025 fund - has 49 percent invested in equities and a shorter period to retirement. So make sure that the funds you hold are in-line with your anticipated retirement date, and proportionally hold the right amount of equities relative to debt.The point is simply to know what you own and be comfortable with it, or adjust your holdings… and not give in to panic if there's a big market drop that you fear could crimp the growth of your retirement assets.#2 Lower your taxable incomeNow’s also the time to complete all your tax-deductible items… So if you’re inclined to philanthropy, now is a good time to complete your charitable givings – which must be done by December 31 so you can take those as deductions on your 2015 taxes… and make sure you keep your receipts, just in case you’re audited.If you have kids and live in a state that allows tax credits or deductions for 529-fund contributions, be sure to contribute by yearend. I believe 34 states and the District of Columbia offer full or partial deductions.You should also consider donating or gifting appreciated assets such as stocks, real estate and mutual funds – to avoid paying hefty capital gains taxes. For example, let’s say you want to donate $20,000 to your alma mater… and say you just happen to have a mutual fund that’s now worth $20,000 that you bought ages ago for $5,000. Your one option is to sell the fund, pay taxes on the $15,

America’s Greatest Con Artist You Never Heard Of

With T.D. Thornton, Author of My Adventures With Your Money: George Graham Rice and the Golden Age of the Con ArtistT.D. Thornton explores the glorious underbelly of America in his new book, My Adventures With Your Money, that takes us into the lurid, imaginative and brilliant world of G.G. Rice, one of America's most notorious and colorful con artists.Master swindler George Graham Rice (“GG”) operated at the zenith of America's golden age of con artistry with plenty of illicit competition, but he stood apart from everyone else due to the sheer audacity, pure nerve and nefarious brilliance of his scams. Against the dark rise of American greed in the early 20th Century into the Roaring Twenties, the dapper but devious "GG" feasted on a nation of gullible prey with the flair of circus showman P.T. Barnum and on a financial scale comparable to modern fraudster Bernie Madoff.GG Rice developed carefully planned and efficiently executed schemes… techniques that are now core to many of today’s modern marketing tactics such as celebrity endorsements, telemarketing, customer profiling (his “sucker list”), data mining, etc. He was a brilliant man who chose to apply his talents to being a con artist. But had he applied his talents within the rule of law, perhaps history would have held him in higher esteem.Thornton walks us through some of Rice’s biggest cons and his ability to bounce back from adversity and being broke – all very fascinating, albeit with a strong dark side to them. For example, with only seven dollars to his name, GG parlayed a chance horse racing tip into millions, lost it all to pride and ego, then won it back many times over. He also engaged in shady Wall Street practices. Securities regulators called hime the "Jackal of Wall Street," and he sparked riots in Manhattan's financial district by perfecting the art of "bucket shop" trading with the sole purpose of bilking the public blind on worthless penny stocks.From the lawless frontier of the Gold Rush to his lust for dizzying riches on Wall Street, GG's supreme knowledge of "sucker psychology" empowered him to orchestrate everything from street corner rip-offs for pocket change to elaborately scripted gambling hoaxes for hundreds of thousands of dollars, all while being vilified by old-guard profiteers like J.P. Morgan and befriended by gangsters like Arnold Rothstein.

Enrolling In Medicare? Here’s What You Need To Know

With Susan B. Garland, Editor of Kiplinger’s Retirement ReportSusan Garland is editor of Kiplinger's Retirement Report, a personal finance publication whose subscribers are retirees, and those approaching retirement and are eager to understand the various financial benefits and expenses related to retirement, such as enrolling in Medicare in a timely manner, what types of healthcare insurances to buy, etc.Garland walks us through the maze of signing up with Medicare - with tips on what seniors need to do, specifics such as enrolling in Medicare within a seven month window, penalties for not signing up on time, and how various employment situations (such as the size of your employer) impact your enrollment in Medicare.For example, Garland tells us that seniors become eligible for Medicare on their 65th birthday and must ideally sign up for Medicare a few months before they turn 65, or risk not having coverage for a few months. She also talks about employer size and how that impacts enrolling in Medicare. So if you are 65, working and covered through your employer, you can stick with your company plan and sign up for Medicare within 8 months of leaving that job… but this rule only applies to companies with more than 20 employees. If you work for a small business with less than 20 employees, your employer is not obligated to cover your healthcare needs after you turn 65… and there’s a good chance your private insurer could ask you to pay back whatever it spent for your healthcare, which can add up to a really big amount if you had a hospital stay – so being ignorant of Medicare enrollment requirements is simply not worth it.Garland also educates us on the various parts of Medicare, what they cover and what you must additionally purchase to cover co-pays, etc. For example, Medicare Part A pays for hospital services at no cost to you, Part B has a premium that starts at about $105 per month, Part D covers prescription drug coverage and MediGap Supplemental Insurance helps pay for expenses not covered by Medicare. Her talk is an essential primer to getting you ready for Medicare as you approach your 65th birthday.

New Laws To Reign In Your Home Owners Association

With Terry Story, 26-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLThis week, Terry begins by addressing the rise in state laws and ombudsmen offices to monitor and regulate Home Owners Associations. With a rising number of legal challenges and disputes between condominium and home owners and their Home Owners Associations (HOAs), many states are setting up offices to monitor, mediate and manage HOA – Resident relations. States recognize that fault often can lie with both parties – rule-flouting home owners or overly onerous HOA administrators who can sometimes be overly strict towards residents in the HOA.Next, she talks about rising interest in older, less expensive homes as investors shy away from expensive new properties and look for higher yields in attractive older neighborhoods where rental rates are rising and homes are still reasonably affordable. Terry advises such investors to focus on location, location, location and look for qualities such as a high-performing school district, but warns investors to expect above-average prices in more desirable neighborhoods.She also addresses the rising trend of home flipping as home prices rise across the U.S., with the most homes flipped for a profit in sunny Florida, according to Realty Trac. But, Terry warns, home flipping isn’t for everyone – you really need to know what you’re doing, have full grasp of remodeling expenses and hidden costs, and know how to contain costs by perhaps having your own team of trusted contractors. While the gross profit on flips averaged $66,000 in 2014, Terry warns that to make that profit, you need to be very efficient.Finally, she discusses the pros and cons of renting versus buying. While some may argue that renters don’t have to pay for expensive ongoing maintenance and repairs, Terry points out that the landlord is ultimately an investor and he factors-in ongoing expenses into the rent you’re paying. So while you won’t have to pay to replace a broken appliance or a leaky roof in your rental property, these one-off expenses are factored into the rent you pay. Moreover, she believes that the financials of home ownership almost always outperform rentals, and home ownership is a great way to generate long term wealth.

Top 10 Money-Saving Military Benefits For Families

Veteran’s Day has come and gone and I feel especially thankful for all who have served and continue to serve in the military… many sacrificing their daily lives at home and many putting their lives at risk to keep us safe and strong. I thank you all for your service.I started to think about the financial challenges one must encounter as a service man or woman and I wanted to see if there were any military benefits or compensations for these challenges in terms of special financial benefits that the government may have created.the government offers military families a list of financial benefits that I hope our service members know aboutAnd thanks to Kiplinger Magazine I found a list of military benefits that most of us don’t know about and I even hope our service members know about. Here’s a sampling:Let’s start with savings and retirement plans:In the Government’s retirement plan, the so-called TSP Plan, a service member can invest up to $18,000 in 2015, and if they're receiving tax-free income while deployed, they can increase their contributions to $53,000 for the year.And now the government has given them access to a Roth Retirement Plan. This ROTH acts like a regular one in that all of the earnings are tax free, which is like a Roth IRA for the rest of us - but without the income restrictions.An additional ROTH benefit service members can get occurs when they receive tax-free combat-zone pay. Because there is no income tax on their pay and their money can go into the Roth tax-free, contributions go in tax-free and their earnings come out tax-free. That’s a nice touch.Talk about savings; The government also gives service members a 10% Guaranteed Return on Savings. That’s right, a 10% Guaranteed Return on Savings!Here’s the direct quote from Kiplinger: “The military’s Savings Deposit Program lets deployed service members invest up to $10,000 in the program each time you are deployed. You receive 10% annual interest, compounded quarterly; the program lasts for up to three months after your return.” Also, any increase in this tax-free take-home pay can be stashed in this 10% interest savings plan.Remember the G.I. Bill? Well, it still exists and offers free college for yourself, your spouse or your kids. This post 9/11 GI Bill covers the full cost of in-state tuition and fees at public colleges for up to 36 months (four academic years), or up to $21,085 per year for private colleges and foreign schools. You’ll also get a housing stipend and money for books and tutoring.The money may be used for undergraduate or graduate programs, or for certain programs at vocational and trade schools. And one of the best features of the Post 9/11 GI Bill is that longtime service members may transfer their benefits to a spouse or children.Inexpensive Life InsuranceThe government also offers Service members one of the lowest-cost life insurance programs available. The cost for coverage is only 7 cents per $1,000 of coverage per month, which translates to $336 a year for the maximum $400,000. Life Insurance is guaranteed regardless of your age, health or likelihood of being deployed. Service members can also get $100,000 in coverage for a spouse for as little as $60 a year if he or she is under age 35.Here’s one that’s a little more subtle but can be helpful. If you maintain a legal residence a state that has no or low income taxes and are deployed out of that state, service members will still be taxed according to their place of legal residence. This rule can shield them from taxes despite the fact that they are living in another state. This applies to the spouse as well if both have to live out of their state of legal residence.

How Being An Introvert Can Help You Succeed In An Extroverted World

With Kim Staflund, Author of Successful Selling Tips for Introverted AuthorsIn our increasingly competitive world, success often seems tied to being an extrovert.  Going out there, striking up conversations and making things happen is how business gets done. But, as Kim Staflund tells us, being an introvert can also be a highly effective leadership characteristic. Moreover, introversion is not an absolute – it’s a sliding scale with varying degrees.Kim Staflund has a secret to share. She's introverted, but she's managed to promote a number of successful books describing how you can do it too. She says the top three fears for most introverts (and many extroverts) are:* What if it’s a bad idea?* What if it doesn’t work?* How to face criticisms to one’s ideas?Kim believes computers and the Internet have made things easier for introverts allowing them to play to their strengths without having direct human interaction by taking advantage of presentations, blogs and social media.Being an introvert has certain advantages, they are great listeners and skillful listening is often key to becoming a successful seller. Introverts are also very comfortable with solitude and can use their quiet time to read-up and inform themselves.  So introverts and extroverts of the world take note – understand each other’s strengths and team up to leverage those strengths in order to succeed in today's competitive world.

Choosing The Right Adviser To Invest Your Money

With Mark Ciucci, Senior Vice President of Advice at United Capital Financial Life Management™As a senior executive at United Capital, Mark guides us through the process of navigating the investment world in order to get the right adviser to invest your money. While the investment professionals have historically concentrated on the selling of financial products, today's true professional focuses on matching the proper investment strategies to your individual life goals.The right investment professional should work with you to understand your priorities, and your near term and long term goals – so it’s important to interview investment advisers to make sure you get someone who’s clearly on your side. If someone begins recommending a product before discussing your life's goals, Mark says run away as quickly as possible and find someone who can invest your money soundly.Advisers also need to manage the amount of risk their clients can truly bear.  He says risk is something most advisers get wrong – so you need an adviser who isn’t out to please you but to truly determine what level of risk is appropriate for you and invest your money accordingly. He doesn’t want advisers to get caught up in simplicities like the so-called "4% rule" but set up a personalized investment plan that truly works for you.

How Much Higher Can The S&P 500 Go?

With Sam Stovall, Managing Director, U.S. Equity Strategy of S&P Capital IQ’s Global Markets Intelligence group; Author - The Seven Rules of Wall Street, The Standard & Poor’s Guide to Sector InvestingSam Stovall is an analyst, publisher and communicator of Standard & Poor’s outlook for the economy, market, and sectors. Sam is Chairman of the S&P Investment Policy Committee, where he focuses on market history and valuations, as well as industry momentum strategies.Sam’s a frequent guest on the show and talks about the potential impact of a widely expected interest rate hike by the Federal Reserve in December 2015. Sam reminds us that the fourth quarter has historically (since World War II) been the best for stocks, with an average 4% gain in the S&P 500.But with a great rally in the S&P 500 in October – driving shares up more than 8% - did sap the expected performance for the rest of the year?  Sam, alas, says yes… so don’t be surprised if shares don’t rise as much or perhaps even drop in November and December. Sam expects November and December to still be positive and would not recommend trading on this idea.He also addresses how the upcoming presidential election on November 8, 2016, might impact the markets. Since World War II, the S&P 500 has been up 6% on average in each election year  -with virtually no down year-  so things continue to look good for stocks.  It is a common Wall Street adage, "as goes January, so goes the year,"  so all eyes will be on how markets perform this January. Sam also addresses different sectors of the economy, global investing and the impact of lower energy prices. He also urges investors to rotate out of sectors instead of selling everything and hoping to time the market.

US Migration Trends

With Terry Story, 26-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLTerry shares her insights… and her befuddlement on some recent US migration data which show that about 8.5 million people migrate each year from one metro area to another within the US. For example, the largest recent migration flow happened in Southern California where about 90,000 people moved from the Los Angeles metropolitan area to the city of Riverside which is only about 55 miles to the east of downtown LA. And 54,000 people moved west from Riverside to LA… so go figure!Terry also talks about the recent October 3, 2015 changes in mortgage rules to favor consumers. It’s basically a 1,900-page new rule book that aims to increase transparency on costs and other issues related to mortgages. But the new rules will require new hiring and administrative overhead and are expected to hike lending costs from about $4,500 to $7,000 per loan – and buyers and sellers will likely end up footing the bill for these added costs.And with El Niño raising its head, many regions across the U.S. may need to brace for more storms.  The Tampa Bay area is ranked as the most vulnerable with potential for $175 billion in losses, followed by New Orleans at $130 billion and New York City at $100 million. 

California Takes A Gamble On Facebook CEO

In 2012, Facebook CEO and founder Mark Zuckerberg paid an estimated $1 billion in taxes, which was considered one of the biggest payments ever. Then, in subsequent years, Zuckerberg beat his own record. According to company filings, he sold 41.4 millio...

This Type Of ETF Could Make You Rich

With Gary Stroik, Chief Investment Officer at WBI FundsAmong investment choices, there’s still a lack of knowledge on the ETF or Exchange-Traded Fund despite their stellar success over the past 25 years since their founding (with over $2 trillion in assets across 1,400 ETFs at the end of 2014). ETFs should be a core component of every portfolio, so it’s important that investors know more about them. ETFs are virtually like mutual funds except that they trade all day long and can be bought and sold with the liquidity of regular stocks.An illustrative downside of mutual funds is that your price is as-of the end of day. So if you place your mutual fund sell order in the morning and the market crashes (think 20% market crash in October 1987), you could end up receiving a much lower price for your mutual fund than you expected. Such is not the case with ETFs because you can buy and sell them virtually instantaneously.ETFs also offer significant tax advantages and don’t leave you holding the bag for others’ gains and losses – in some instances owing capital gains taxes on mutual funds that you sold for a loss. Another key difference is the active versus passive management feature of mutual fund versus ETF. Mutual funds are typically actively managed whereas ETFs typically follow an index without any judgment call by the fund manager – so you also end up paying a lot less in fees and expenses with ETFs relative to mutual funds.So despite all the bad rap that Wall Street gets, the ETF was actually a very useful innovation. But Wall Street now has a “smart beta ETF” – with beta measuring the correlation between two things. So a beta of 1.0 exactly mimics an index whereas the beta rises above 1.0 if the security has higher volatility than what it’s being compared to.Stroik also walks us through how stock indexes are structured, weighing the index based on their market capitalization – so Apple, Google, Microsoft, Exxon Mobil and Berkshire Hathaway make up a disproportionate 11% of the weight of the S&P 500 – so an index does not necessarily give you the diversification you want. So traditional ETFs that mimic an index may not be good enough… and this is where smart beta ETFs come into play – and slice and dice indexes to correct for some of their biases.

Older Couples Should Question Marriage Benefits

With Jane Bryant Quinn, Personal Finance Expert, author of Making the Most of Your Money NOWJane Bryant Quinn is an expert on personal finance and an author of multiple books on personal finance, including a new book out in January 2016 titled “How to Make Your Money Last” where she advises everyone on how to stretch their money in retirement as life spans continue to expand. She also talks about the financial issues around the benefits of wedded bliss, emotions apart… with tips such as marriage benefits for retiree finances such as survivor’s benefits, medical decision-making power, tax benefits on IRAs, etc. – things you cannot do if you are a single retiree.But while there are marriage benefits, there also are a few pitfalls such as being liable for the other’s medical or long-term care bills – which you can navigate around through things like long-term care insurance. Jane talks about how remarriage impacts your social security benefits. She also talks about how Congress dropped a bombshell with changes in social security laws that close a lot of earlier loopholes – so those heading into retirement should make sure they educate themselves on these changes and plan ahead.Jane has had a wonderfully colorful life, with a good measure of financial missteps and misfortune along the way, but through it all, she’s managed to come out ahead and has used her experience of triumph over loss to motivate others to make the most of their money and save enough for a comfortable retirement.Jane say, she’s writes about personal finance because she’s a lot smarter now. First because she saved a lot of money and learned how to invest it well. Second, to show that everyone makes mistakes. The trick is to learn from them, grow strong and do better.  And third, to abolish the myth that you have to be born with a math book in your mouth to be good at making decisions about your personal money.As she puts it, personal finance has nothing to do with math. It’s all about understanding simple principles (such as automatic savings), knowing where to find the advice and tools you need (on her website and in her books) and choosing low-cost, plain-vanilla financial products (because they’ve proven to be superior to everything else over time).

Fund Your HSA Now To Save Thousands In Taxes Later

With Kevin Martin, Senior Tax Advisor, H&R BlockWant to pay less in taxes but aren’t quite sure how? Or are you amongst the 63% of eligible Americans who are just giving money away to the government when you can keep it? Kevin Martin, a senior tax advisor at H&R Block shows us how we can all take advantage of various government tax breaks to reduce our 2015 tax burden.As 2015 draws to a close, this is a good time to think about how you can take advantage of various government approved tax shelters such as health savings accounts (HSA) and flexible spending arrangements – but less than 37% of all eligible FSA savers use these legal shelters to reduce their tax burden, so use things like Open Enrollment to sign-up now and get a break on healthcare premiums.Martin walks us through Flexible Spending Accounts – where you put in money for qualified medical expenses, up to $2,550 for 2015 - and can reduce your taxable income by the amount you put in. One down side of this account is that it’s a Use It or Lose It – where the balance cannot be rolled over into the next year – so perhaps that’s why so many people don’t use it, especially younger folks, and why seniors with annual medical expenses are better positioned to take advantage of this.There’s also an HSA or Health Savings Account which let’s you contribute money towards healthcare expenditures and invest the money you put into this account – without the dreaded Use It or Lose It feature. Moreover, the growth in that account is also tax-free, as long as the money’s used to pay for qualified healthcare expenses. If you take the money out, you pay taxes and pay a 20% penalty. So tune in to find out how you can pay less in taxes.

5 Key Factors that Drive Home Sales

With Terry Story, 26-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLSo with the housing market doing pretty well, Terry sheds some light on why people buy and sell their homes and key factors of what's driving home sales. The #1 reason for sellers appears to be “I’m just tired of it” as people accumulate junk through the years, tire of the same old layout, have no desire to go through renovations and are basically just done with the home and looking for a change. The #1 reason for buyers, at least right now, is that mortgage rates are still at all-time lows – under 4% - rates we last saw in 1971! Moreover, home prices still appear reasonable, especially with the lower mortgage rates.Now, with the economy bouncing back, people feel more confident – financially – and have recovered some of their losses through the 2008 recession – so they are more comfortable with making the financial commitment, have an employment and salary history that can get them a mortgage, and have money saved up for a down-payment, which no longer needs to be as high as 20% but is down to single-digits, especially for those with good credit.People are also buying and selling homes because of changes in family circumstances – births, deaths, families merging together, etc.And the #1 mistake when you’re buying a new home or building a custom home is over-building! With the average cost of construction at about $105 per square foot, shaving off even 500 square feet is about $50,000 in savings. Not to mention the maintenance, furniture and fittings. People should also think of resale value and look at whether people are really looking to buy a 5,000 sf home. In the same vein, holding back on upgrades can save you money that can be better used on must-have features. And stay on top of the process.Terry also talks about millennials becoming a more important demographic as 10,000 baby-boomers retire each day and are looking at down-sizing – eyeing some of the same properties that younger millennials may find attractive, and winning out with greater buying power.

Change in Payday Lending Rules Could Hurt Those Who Need It The Most

With William Isaac, former Chairman of the FDICBill Isaac quite an expert in the field of finance and banking, and has some choice thoughts on the pros and cons of payday lending – small loans that typically do not attract any interest from banks and are typically sought by sub-prime lenders who turn to shady lenders for short-term loans of $200 - $300, to be repaid with fees and rates that are close to 400% in annual terms. So they’re really high cost loans made to people who can least afford the high interest. Bill talks about a new set of rules on payday lending from the Consumer Financial Protection Bureau – and says this could really hurt those that really depend on payday lending and drive them into the arms of loan sharks and other unsavory characters.In 1978, at age 34, Bill Isaac was tapped by President Jimmy Carter to serve as the youngest-ever member of the board of the FDIC. The position proved to be full throttle from day one – in fact, on his first day in office at the FDIC, Isaac was called down to Puerto Rico, where one of the territory’s largest banks, Banco Credito, was set to fail. Isaac was named Chairman of the FDIC in 1981 following the election of President Ronald Reagan. He served in that position through 1985 and is credited with preparing the FDIC for an onslaught of bank failures throughout the 1980s and into the 1990s.Isaac is involved extensively in thought leadership relating to the financial services industry and policy makers worldwide. His articles are published in the Wall Street Journal, Washington Post, New York Times, Forbes and other leading publications. He also appears regularly on leading television and radio programs in the US and abroad, is a contributor to CNBC, testifies before Congress, and is a frequent speaker throughout the world on finance and regulatory matters.While there is no racial bias in payday lending, they do target low-income people in dire need of money. But Bill makes the case that these loans actually provide quite a service to people who desperately need these loans, and are often their best alternative – provided, of course, you stop rolling it over, don’t pay your interest and dig yourself deep into a hole. But responsible payday lenders are cognizant of this and, in their own interest, prevent extensive rollovers of short-term payday lending.

How to Profitably Sell a Small Business

With Pamela Dennis, Author of Exit Signs: The Expressway to Selling Your Company with Pride and ProfitPamela has worked with amazing leaders and their organizations for over 35 years: from emerging companies and small, closely held partnerships to global Fortune 100 firms. She knows the challenges of diverse industries in growth times and in downturns. Pamela also built and led an international consulting business that received recognition for its own growth and impact. She sold that business after nearly 20 years and the firm continues today -- profitably, with new and legacy organizations in the US and internationally. That experience is the basis for her book, Exit Signs.In the next five to ten years, millions of small and mid-size business owners – aging baby boomers - will try to sell a small business. But an astonishing 87% of them don't have an exit plan. If you've been waiting to make a plan to transfer ownership of your business, then this is the book you've been waiting for. Exit Signs is about both the tactics of selling and the transitions of leaving. It gives you a step-by-step map to sell a small business in a way that produces the profit you've dreamed about. These steps bring you confidence and pride knowing your company will be in solid hands and they give you greater serenity about the next chapter in your life. For any type of owner and any type of business now is the time to let Exit Signs help you onto the expressway towards a great sale.As she puts it, there are 22 million small businesses and less than 50% have an exit strategy – partly because they are all consumed with growing their baby, partly because they don’t think this is the right time and partly because they’ve never thought about going to sell a small business. And with small businesses making up a large percentage of American payrolls, a disastrous sale potentially impacts millions of jobs.She also talks about steps such as financials, customer retention, bench strength, operational efficiency if the owner leaves and other steps to make sure the company succeeds even after the owner leaves.

Lie to Home Buyers, Go to Jail

With Terry Story, 26-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLHere’s a long but attention grabbing headline from the world of residential real estate… Couple arrested after 'pocketing $153,000 of insurance money and selling house without telling the new owners about a secret sinkhole that splits the living room in two’.A Florida couple could face up to 20 years in prison each after allegedly taking insurance money to fix a sinkhole but failing to fix the problem before they sold the property to another owner. The couple face federal charges for wire fraud after supposedly receiving a $153,000 settlement but leaving a sinkhole and collecting an additional $60,000 from a family with five children. Terry’s advice – honesty is always the best policy when you’re selling a home so you don’t have to face a lawsuit down the road, and for obvious moral reasons.In addition, there’s some good news for low income home buyers – with laws that let income from household members - grandma and grandpa – potentially count towards income to pay off a mortgage. That’s great news for folks that tend to live in joint families – it’s a win all around provided home buyers do not lie or take unfair advantage of those who live with them.Terry also cautions people against over-estimating their home values as they go into a sale – because price is a key factor in home sales. If you over-price your home, savvy buyers that do their homework over the Internet will not even come and look at your home – because buyers typically do way more research than sellers.Experts think the housing market should remain strong through 2017 – so this is still an okay time to be investing in property – especially with the U.S. economy mostly picking up across all states.Finally, Terry answers a listener’s question about protecting yourself and your property while wanting to help out a loved one… her advice, treat it like a business transaction and protect yourself.

5 Reasons Oil Prices Are Near A New Tipping Point

Oil prices have seen a fair amount of volatility over the past 20 years – with West Texas Intermediate or WTI Crude climbing from a low of about $11 per barrel in December 1998 to a high of almost $134 per barrel in June 2008, just ten years later, the...

How to Profitably Sell a Small Business

With Pamela Dennis, Author of Exit Signs: The Expressway to Selling Your Company with Pride and ProfitPamela has worked with amazing leaders and their organizations for over 35 years: from emerging companies and small, closely held partnerships to global Fortune 100 firms. She knows the challenges of diverse industries in growth times and in downturns. Pamela also built and led an international consulting business that received recognition for its own growth and impact. She sold that business after nearly 20 years and the firm continues today -- profitably, with new and legacy organizations in the US and internationally. That experience is the basis for her book, Exit Signs.In the next five to ten years, millions of small and mid-size business owners – aging baby boomers - will try selling a small business. But an astonishing 87% of them don't have an exit plan. If you've been waiting to make a plan to transfer ownership of your business, then this is the book you've been waiting for. Exit Signs is about both the tactics of selling and the transitions of leaving. It gives you a step-by-step map for selling a small business in a way that produces the profit you've dreamed about. These steps bring you confidence and pride knowing your company will be in solid hands and they give you greater serenity about the next chapter in your life. For any type of owner and any type of business now is the time to let Exit Signs help you onto the expressway towards a great sale.As she puts it, there are 22 million small businesses and less than 50% have an exit strategy – partly because they are all consumed with growing their baby, partly because they don’t think this is the right time and partly because they’ve never thought about selling a small business. And with small businesses making up a large percentage of American payrolls, a disastrous sale potentially impacts millions of jobs.She also talks about steps such as financials, customer retention, bench strength, operational efficiency if the owner leaves and other steps to make sure the company succeeds even after the owner leaves.

7 Common Myths When Buying a Home

Over the past few years, there have been quite a few changes in the mortgage qualification process for those buying a home – with the aim of protecting consumers from the kind of housing crisis and meltdown we witnessed in 2007 when the mortgage industry collapsed, home prices tanked, foreclosures were rampant… and led to a global recession in 2008.everyone interested in buying a home should be aware of recent regulatory changes, and also not fall prey to common myths about home buyingSo, I think everyone contemplating a housing transaction – as a buyer or seller – should be aware of recent regulatory changes. I also want to address common myths about home buying that were nicely covered in a recent article by Caroline Banton in GoBankingRates.com.Now, I’m sure most of you remember the madness in the housing sector: rash mortgage lending standards, zero down payments even to people with bad credit, aggressive sales tactics that got people into buying a home they really could not afford – on the false pretext that housing prices will only continue to rise over time, etc. That, of course, led to low ‘credit quality’ mortgages (sub-prime mortgages as they were called) being repackaged by Wall Street and sold off with excellent credit ratings, and everything famously collapsed like a house of cards.Then, federal regulators initially tightened lending standards to prevent such future defaults and foreclosures. The new standards used stricter assessments to determine whether prospective buyers had the ability to repay their mortgages when buying a home.Okay – with that background, let me walk you through the changes and bust some widely held perceptions about home buying.Myth No. 1: A Big Down Payment Is RequiredIn January 2014, regulators eased up on those tight lending standards after real estate groups and consumer advocates claimed that millions of Americans would not be able to qualify for housing loans. They argued that people with good steady jobs had simply seen their savings disappear through the 2008 crisis, and good quality buyers just could not afford to make a 20% down payment, as the tighter regulations required.As a result, the proposed 20 percent down payment rule was dropped. Banks now are only required to document that a borrower has the means necessary to afford a mortgage as long as it does not exceed a certain threshold of debt.Now, banks typically require between 5 percent and 20 percent of a home’s purchase price as down payment – so there’s more flexibility and people with good credit can get away with putting down as little as 5% though lenders typically require private mortgage insurance (or PMI) for down payments under 20 percent – to protect the lender should you default on the mortgage.PMI typically costs between .05 percent and 1 percent of the loan amount annually. So PMI of 1 percent on a $100,000 mortgage, for example, would cost $1,000 a year or about $83 a month.So, believe it or not, most prospective home buyers are still under the false impression that a 20 percent down payment is required – it’s probably the most common misconception lenders encounter.Additionally, loans from the Federal Housing Administration require a down payment of just 3.5 percent of the home’s purchase price. And loans from the Department of Veterans Affairs and the U.S. Department of Agriculture require no down payment for eligible buyers – so make sure you see how low you can go.National, state and county programs also offer grants to home buyers – ain’t that nice – provided you meet specific guidelines such as completing a home buying class before obtaining the grant – not too painful, considering what you get in return – I’ll take it if I can!Myth No. 2: I Need Perfect CreditYour FICO credit score, which is a measure of your credit worthiness, can range from 350 to 850.

It’s All About Your Money In The Upcoming Republican Debate

With John Harwood, Chief Washington Correspondent for CNBC, Political Writer for The New York TimesJohn Harwood of CNBC will be one of three moderators of the third Republican presidential debate along with Becky Quick, co-anchor of the Wall Street-focused show “Squawk Box,” and Quick’s co-anchor, Carl Quintanilla.The debate - titled “Your Money, Your Vote” – to be held Wednesday, October 28, 2015, live from the Coors Events Center at the University of Colorado in Boulder, which is used to hosting 11,000 fans for U of C basketball games. John says the debate will pay particular attention to economic issues and how they impact your money, including taxes, retirement spending and job growth, and says tech policy will come up in the questioning. They will also focus on affordability for middle class Americans and policy decisions that will impact current and future generations – with discussions on candidates’ positions on proposed tax cuts such as Rand Paul and Ted Cruz’s flat tax, dividends and capital gains’ tax treatment, tax credits for certain income groups, etc.John lays out economic positions and tax cut proposed by leading candidates and how each will impact policy, whether they overly favor the wealthy, how they impact estate taxes and their overall implications –  how much they lower government revenue but don’t spell out spending cuts to make up for the loss.The debate is set to run two hours (including commercial breaks). Originally expected to be another marathon session, CNBC acquiesced to the demands of several of the contenders eager for a more succinct session. Who will participate in the debate? With the exception of Scott Walker, the main draw of candidates is identical to the previous debate that aired on CNN: Donald Trump, Ben Carson, Jeb Bush, Marco Rubio, Ted Cruz, Mike Huckabee, Rand Paul, Carly Fiorina, Chris Christie, and John Kasich. Where will they stand on stage? Donald Trump, the highest polling candidate with an average of 25.22 percent, will stand center-stage for the debate, though with an even number of candidates, Carson also will appear in the center, polling at 19.78 percent.

No October Rate Hike Despite Job Growth

With David Payne, Staff Economist – Kiplinger LetterEveryone’s wondering what’s next for interest rates that have been at all-time lows for the past 6 ½ years. David Payne sheds some light on this and talks about how job growth and inflation play into the Fed’s decision.David is both staff economist and reporter for The Kiplinger Letter, overseeing Kiplinger’s forecasts for the U.S. and world economies. Previously, he was senior principal economist in the Center for Forecasting and Modeling at IHS/GlobalInsight, and an economist in the Chief Economist's Office of the U.S. Department of Commerce. David has co-written weekly reports on job growth and economic conditions since 1992, and has forecasted GDP and its components since 1995, beating the Blue Chip Indicators forecasts two-thirds of the time. David is a Certified Business Economist as recognized by the National Association for Business Economics.David expects an increase in interest rates by the end of the year based on Fed Chair Janet Yellen’s comments but there are doves and hawks within the Fed’s rate setting committee so the jury will continue to be out till rates are raised.The Fed, of course, will base its hike on economic fundamentals. One of the data points the Fed watches is job growth and employment – which is doing pretty well in the U.S. and supports the case for a rate hike. But another Fed measure – inflation – isn’t an issue; it’s well below the Fed’s 2% threshold rate for action due to factors such as low oil prices and a strong dollar that continues to make imports less expensive. Slowing growth in China also raises concerns over the strength of the global economy, and gives pause to U.S. economists.Now, when rates rise – which they will at some point, who knows when – David expects the increase to be slow and measured, as the bond market expects – with about one rate rise in mid-2016 and the other towards the end of 2016.David also talks about how a rate rise will ripple through other borrowing costs and rates on CDs. With the Fed meeting this week, let’s wait and see what they say about the state of the economy and inflation.

Get Approved For A Mortgage Without Sticking A Fork In Your Eye

With Elysia Stobbe, Author – How to Get Approved for the Best Mortgage Without Sticking a Fork in Your Eye: A Comprehensive Guide for First Time Home Buyers and Home Buyers Getting a Mortgage Since the Mortgage Crisis of 2008Did you know that over 50% of mortgages don't close? Do you know how much home you can buy? Do you know how much paperwork in involved? Most people don't know how much home purchasing power they have, how much to expect for closing costs (varies by state), or how much paperwork is involved when applying for a home loan to get approved for a mortgage. Most people have no idea the difference between loan programs from bank to bank, lender to lender, or broker to broker- or what the differences are between the main types of residential mortgage providers. Most people have no criteria for choosing a lender, the type of loan to seek, or how much down payment is best for them. For example, are there differences between the types of property that may affect down payment?Elysia’s book hands out excellent tips on how to get approved for a mortgage. She’s a mortgage broker, has been in the industry for over 13 years and closed more $250 million in residential mortgage loans during her career.The mortgage industry is packed with nuance, which can lead to confusion for the consumer. While trying to buy a home, you may have people from many different professions telling you what you should do and how to make decisions to get approved for a mortgage – so who should you listen to in which situations?Your most personal financial information is critical to the mortgage process and yet do you know who you are sending it to? What about mortgage insurance? Why is it required and when?The two questions she hears most often hear are: "What's the payment?" and, "What's the interest rate?" While these questions are important, there are several other questions that are just as critical: what is the right loan type for you; is there an up-front funding fee for the loan; what are the differences in available mortgage insurance; how will property type restrictions affect your loan; what are the pros and cons of the loan; what is the down payment requirement with this loan choice over another; what are the closing costs associated with each loan type; and, who is allowed to pay the closing costs? Successfully navigating the maze of questions, regulations, and requirements ultimately leads to a mortgage closing.

How to Avoid Home Buyer’s Remorse

With Terry Story, 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLHome buyers, millennials and the rest of us, often have Buyer’s Remorse. Terry talks about the Top Buyer’s Remorse Issues with post-purchase regret. Believe it or not, topping the list is “my house is too big” – especially when their utilities jump up in the bigger home with higher electric, gas, heating, cooling, watering bills, cleaning area, etc.The second remorse is “layout awkwardness” so make sure the home’s layout matches your needs. Also make sure you don’t get caught up in fancy new millennial trends that are like passing fads and make your home less saleable down the road. Many, especially physically active millennials, love the pool at first but soon figure out that it’s more a liability and an ongoing cost, without much use. Granted, pools do help with resale value in certain regions of the U.S. but not necessarily across the country.There’s also some good news, buying a home today is 48% more affordable than in 2006 – this despite home prices outgrowing wage increases, largely aided by significantly lower mortgage interest rates today compared to 2006 – that lead to lower monthly payments, making home more affordable.98% of Americans now have cell phones and people are increasingly getting rid of landlines and even setting up their alarm systems through cellular connections. So it’s important to make sure you buy a home in an area that is well served by mobile service providers, and gives you at least two options when choosing land-line based Internet service, with at least one fiber optic provider so you can get the blazing fast Internet speeds you need to work and play. You could even be in a city like Manhattan or San Francisco, and still face connectivity issues – so make sure you check this out too before you buy, in this increasingly interconnected world.

The CEO That Outperformed Steve Jobs Apple Stock

Remembering Steve JobsWell… how time flies… it’s now been over five years since Steve Jobs - Apple’s charismatic founder and CEO – passed away in August 2011. And, the much-anticipated movie “Steve Jobs” – a biopic that purportedly highlights three k...

Found Footage: Donald Trump Said No To Running For President

With David Beck, Founder, "Reelin in the Years"David Peck founded ‘Reelin in the Years’ when he was just 26, and has always had a strong interest in music. Their most recent release was The Merv Griffin Show 1962-1986, a 12-DVD box set of some of the greatest episodes from one of television’s most beloved talk shows. He’s also got unseen, archival footage of Donald Trump from 1980. Interestingly, in the clips, Donald Trump is interviewed and one of his questions is whether the Donald would ever consider running for president, and Trump actually says NO, he would not consider it. How times have changes, with Donald Trump now the Republican front runner early in the race for president.In his chat with Steve, he talks about the fascinating rise of Merv Griffin into one of the industry’s top television hosts and a media mogul credited with creating game shows in the 1950s, including Jeopardy! and Wheel of Fortune. He was a very astute talent and businessman, and used his smarts to build considerable influence, fan following and wealth.David Peck’s company, Reelin’ in the Years Productions, has signed representational deals with many of the world’s biggest television stations and has amassed the world’s largest library of music footage, housing over 20,000 hours of material from the 1920s to today. The company is recognized as a world leader in music footage, and representation of the daily talk-show The Merv Griffin Show, the Sir David Frost Archive and others, with rights to license over 4,000 hours of in-depth interviews with the 20th century’s icons of Film and Television, Politics, Comedy, Literature, Art, Science, Fashion and Sports, filmed between 1962-2012.As well as licensing thousands of short clips for various projects, Reelin’ In The Years Productions has also been involved in creating original programs and releasing whole performances from their archive on DVD. The company has also produced a multi-platinum selling Motown series with the Temptations, Marvin Gaye, Smokey Robinson & the Miracles. Their most recent release was The Merv Griffin Show 1962-1986, a 12-DVD box set of some of the greatest episodes from one of television’s most beloved talk shows.

Forbes Believes Real Estate Mogul Could be Gamechanger

With Jilliene Helman, CEO and Founder of Realty MogulRealtyMogul.com is an online capital marketplace for real estate - connecting borrowers and sponsors to capital from accredited and institutional investors.  The company is the brainchild of Jilliene Helman who was recently listed in Forbes magazine. As part of its 2015 ’30 Under 30’ honors for young achievers, Forbes listed Helman at #28 in the Enterprise Technology category. Forbes also covered Helman’s rise from a 25-year old Vice President at Union Bank to the CEO of her own company that has done over $80 million in real estate transactions.Through an online platform, RealtyMogul.com gives borrowers access to debt capital, sponsors access to equity capital and investors tools to browse investments, do due diligence and invest online. It’s crowd-funding for real estate that gives well-heeled accredited investors an ownership stake in real estate assets they choose to invest in, and online dashboards that show them how their investments are performing on a quarterly or monthly basis, with monthly or quarterly cash distributions.So if you’re interested, check out their website and tune in to hear how the platform works for you as an investor in the two funds the company currently offers. Invest across property type (residential, retail, medical, etc.), across geography and across debt and/or equity – for a well-diversified real estate portfolio. But don’t expect day to day liquidity through this platform but dive in only if you’re willing to commit your capital without withdrawals for anywhere from one to ten years.RealtyMogul.com offers fix-and-flip loans, bridge and permanent loans and joint venture equity. It’s a site that caters to active and passive real estate investors, including individual investors that buy houses for rent, small commercial properties or REITs. But such investors can expand their investments through Realty Mogul, with minimum investments starting at $5,000 so investors can build a diversified portfolio of assets, with average transaction size of $35,000 and about three or more transactions, with investors typically investing about $90,000 through the platform.The company has over 17,000 active accredited and institutional investors as members, and their members have invested over $80 million dollars in over 250+ properties, and received millions in distributions. For accredited and institutional investors looking to diversify their portfolio, RealtyMogul.com offers a fast, easy, frictionless platform that serves as a 21st century bridge connecting them to previously inaccessible investment opportunities.And for both real estate investment sponsors looking to raise joint venture equity and borrowers looking for flexible debt, RealtyMogul.com provides access to equity and debt that would likely take several months to secure through more traditional means – but beware, rates can be as high as 10% over and above the 2% -3% origination fee and the 0.5% servicing fee. So the company caters to accredited or institutional investors wanting to diversify their portfolios across real estate asset classes, borrowers in search of flexible loans, or real estate investment sponsors looking to raise joint venture equity.

The Modern Workplace: 3 Vital Steps For Millennials

With Nigel Dessau, CMO at Stratus Technologies, Author of Become a 21st Century Executive: Breaking Away from the PackNigel Dessau is the author of “Become a 21st Century Executive: Breaking Away from the Pack” and the driving force behind the website ‘The 3 Minute Mentor’ which provides simple, easy to follow career guidance in easy to follow three minute videos. The website is followed by thousands of subscribers from all over the world, including millennials who have recently entered the workforce and want to develop their career skills for success.His book provides a guide directed to both new (think millennials that make up the largest percentage of today’s workforce) and experienced middle managers, and offers advice to help these workers survive in the modern workplace. More than just a review of office or corporate practices, the book is a program designed to help executives assess strengths, weaknesses, and determine whether there's opportunity to succeed in an existing corporate structure, or whether it's time to look for a better business match.Chapters address the specifics of managing for better effectiveness, understanding what typically goes wrong in business interactions, how to better approach budgeting and other topics ranging from locating mentors to understanding the power of value propositions. The result is a game plan for achievement and advancement, recommended for young millennials and older managers who want to move onward as well as upward in their careers.In his book, Nigel talks of taking chances as a pre-requisite to breaking through to higher levels in your career. He addresses three key aspects – foundations - to moving up in your organization – Content, Approach, and Network… what you know that is of value, doing things with the stuff you know to achieve your business objectives, and leveraging your network to get ahead.Previously, as Senior Vice President and Chief Marketing Officer of AMD, he was responsible for the company’s global marketing, image and campaign strategies. Earlier, he spent 19 years at IBM and led the marketing strategy behind e-business and the transition to On Demand Business.

Is It Better To Rent Or Buy?

With Terry Story, 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLTerry covers four key aspects related to housing – recent consumer-oriented changes that impact mortgages, a question on unauthorized property alterations by a tenant, whether it’s better to rent or buy, and the reasons that people tend to want to move out of their homes and neighborhoods.The Consumer Financial Protection Bureau just put out a new mortgage initiative – the Know Before You Owe mortgage disclosure rule - designed to help consumers understand their loan options, shop for a mortgage that’s best for them, and avoid costly surprises at the closing table. The Know Before You Owe mortgage disclosure rule replaces four disclosure forms with two new ones, the Loan Estimate and the Closing Disclosure. The new forms are easier to understand and easier to use. The rule also requires that you get three business days to review your Closing Disclosure and ask questions before you close on a mortgage. So to make sure the closing process goes smoothly for you, it’s important to know how this rule will affect you as a mortgage buyer, and help you choose lenders and realtors that are aware of and well prepared to handle these changes on your home mortgage process. The bottom line is that consumers will now know their closing costs and all relevant numbers three days prior to closing - for better consumer awareness... but be prepared; the rule went into effect October 3 and it’s going to be crazy initially as computer systems changeover and people get comfortable with the changes.Terry answers a listener’s question about a tenant who made changes to a rental property without written permission from the owner – that’s a big no no, by the way – such changes are clear grounds for eviction and you shouldn't expect to get reimbursed for the changes you made... so it's important that landlords and tenants are aware of this. Major property repairs typically are the landlord's problem, so if you encounter something serious, don’t take it upon yourself to fix it… but contact your landlord first, and know that you can also use this as grounds to cancel your lease. In a nutshell, know your rights and your limitations.Is it better to rent or buy? There is no right answer and it really depends on your financial situation and where you live... some locations and situations favor ownership, others are closer to breakeven between owning and renting – so there is no straight answer but view this in context to where you live.And lack of space appears to be the #1 reason people want to move, followed by maintenance related issues (too old, not well maintained, chronically problematic plumbing, etc.), noisy and unfriendly neighbors, messy yards, too many fast-moving vehicles on their street, houses that are too close to each other, or being too far from retail – the reasons runs the gamut.

How Empowered Women Build Wealth And Banish Fear

With Cary Carbonaro, CFP, Managing Director at United Capital, Author of The Money Queen’s Guide: For Women Who Want to Build Wealth and Banish FearCary Carbonaro has seen tremendous highs in her professional career over the past 25 years where she's focused on providing top tier financial advice to thousands of clients, but she’s also seen some really bad lows in her personal life – primarily from a financially dodgy husband.So, to share her story and warn and advise others – men and women, she recently published a book titled The Money Queen’s Guide to help other empowered women take better control of their financial lives, anticipate deadbeat situations before they erupt, and generally be in better control of their wealth and finances. She offers great advice throughout her book on a wide variety of topics, with five keys to financial planning.For example, she wants couples to make sure they fully understand each other’s financial assets, savings, loans and liabilities – with full transparency before heading into relationships - so there are no nasty hidden surprises down the road. But doing your financial due diligence on a future spouse is not an easy thing and something most women, in particular, shy away from – so Cary wants empowered women to overcome their fears and take on this challenge before making long-term commitments to ensure their own financial security later on in life.

How To Be Financially Protected From A Data Breach

With Dr. Timothy Summers, Cyber Strategist, President of Summers & Co., Author of How Hackers Think: A Study of Cybersecurity Experts and Their Mental ModelsA data breach is a severe and growing nemesis, with skillful hackers cracking into America’s most secure databases and systems, often with the support of their governments. Cyber security is one of the biggest threats individuals, corporations and governments face across the world and the threat of a potential data breach is just around the corner.Hackers steal everything from personal information to corporate, business and government secrets. Dr. Summers addresses the implications of this big looming concern. He tells us how these intruders operate on the “dark web”.He also addresses why companies are unwilling to protect our data against a potential data breach, and typically tell consumers what to do to better protect their data without, apparently, doing anything significant to do more to protect consumers. Moreover, companies are under no regulatory pressure to act because regulations have been stymied by corporate-backed political opposition. So Summers walks us through a few things we can do to make it more difficult for hackers to steal our data and identities.

Is It Time-Up Or Time-Out For The S&P 500?

On August 17, 2015, the S&P 500 Index was slightly above 2,100. Then in just one week, by August 25, the index had dropped like a stone - down 11% - to 1,867… and it’s been very volatile since then. For example, last Friday – on October 2nd – markets w...

What Does It Take To Become A Great Real Estate Investor?

With Eleanor Blayney, Consumer Advocate at the CFP Board, Author of Women’s Worth: Finding Your Financial ConfidenceIn her conversation with Steve, Eleanor addresses being a real estate investor. As real estate valuations go up and interest rates remain at all-time lows, many investors are looking at supplementing their retirement income with monthly payouts from rental properties. But while people are regaining their appetite for real estate and considering becoming a real estate investor, it's important to understand the nuances of real estate investing, including the risks, headaches and uncertainties involved.It's also important to understand that real estate need not be viewed as an alternative to the stock market.  And while investors like the ability to touch and walk around their real estate investments, without the volatility surrounding stock investments, investors should not forget that real estate too can be a pretty volatile asset, as we saw in the collapse in 2007.So those who have become a real estate investor should really be viewed in the same vein as running a business with its own set of risks, upside and uncertainty.  For example, that rental check that you expect next month may well not arrive for a host of reasons, or your tenant may file for bankruptcy, call you for unexpected and often expensive maintenance and repairs, etc. So real estate investing is not a slam dunk and has a host of uncertainties, not to mention large upfront purchase costs and the burden of servicing a loan, navigating the complex tax code around real estate investing or the lack of liquidity because you can’t pull your money out as easily. So tune in to hear all the nuances of real estate investing before you jump in and make some serious mistakes.

Why You Still Need A Real Estate Agent

With Terry Story, 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLEven Web-Savvy Millennials Prefer A Face To Face On Their Home BuysHere’s something that’s pretty counter-intuitive… the abundance of online information has actually driven up demand for the face to face real estate agent – from 83% in 2010 to 88% in 2015. Part of the reason is that there’s just so much information out there that it’s hard to tell truth from fiction and marketing hype, so buyers, including younger, web savvy millennials are using their online research to select experienced agents that can hold their hands through likely their biggest expenses ever – a home purchase.There’s also the issue of changing real estate and mortgage laws which buyers have a hard time keeping up with, and naturally see value in using an agent that’s up-to-date on all the regulations and is on-hand to help with negotiations and answer questions face to face.And with rising unemployment, demand for housing continues to be strong, especially in more desirable areas. So higher prices are pushing buyers out to cheaper areas away from city centers and commuting distances appear to be rising. Tight inventory is also capping people that want to sell and trade out or trade up, so it’s a bit of a Catch 22, which is why new home construction could be the answer to alleviating the crunch in housing.

Don’t Let Hidden Fees Ruin Your Vacation

With Terry Story, 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLAfter soaring all year, existing home sales stalled a little in August 2016, down 4.8%, because of tight inventory levels that perhaps deterred some buyers. In a related development, price rises have also moderated which is good news for buyers who can still score great rates on their mortgages. The declines were most pronounced in the south and the west – regions that had also rebounded strongly in the past.Terry shares her thoughts on how the Fed’s decision on interest rates… see why she thinks that’s a bit of a non-event for home sales. In addition, Chinese premier Xi Jinpeng’s recent visit to the U.S. highlighted the impact that Chinese investors have had on the U.S. housing market – on single family homes and apartments.Finally, changes in the pricing of vacation rentals and hidden charges are something you should be aware of if you’re active in that market. See what’s happening there, why it’s happening and what you can do to protect yourself.

The Power Of Growth Stocks According To Buffett’s Mentor Benjamin Graham

with Fred Martin, President & CIO, Disciplined Growth Investors and Author of Benjamin Graham and the Power of Growth Stocks: Lost Growth Stock Strategies from the Father of Value InvestingFred Martin is a disciplined investor and an ardent disciple of Ben Graham. Martin founded Disciplined Growth Investors in 1997. As President and Chief Investment Officer, he oversees the operation of the firm and serves as an analyst, portfolio manager and head of the investment team. Fred has a very clear commitment to what his job is about and that’s making money for his clients.As a portfolio manager, Fred has built his investment process on the strategies of the late Benjamin Graham “The Father of Securities Analysis.” Fred has expanded on Graham’s strategy in his book which helps you rediscover the legendary investor’s forgotten growth-investing strategy through a cutting-edge approach to capturing profits in today’s volatile markets. Fred shares the investing approach that was founded on Graham’s long-lost valuation formula. And his method promises to let you accurately and confidently value growth-companies for a buy-and-hold strategy that mitigates risk and positions your portfolio for superior long-term returns.Fred outlines three key steps to identify growth stocks, evaluate Margin of Safety, and make a call on whether to buy or simply stay on the sidelines and “admire” a company that may be great but too richly valued to deliver a minimum “hurdle rate of return”. He also shares Graham’s simple but fairly accurate back-of-the-envelope calculation – the Capitalization Model – on valuing growth stocks. Fred also lets us in on what investors need, beyond data and valuation, to score a few big winners.While mostly viewed as the guru of value investing, Graham openly admitted that his biggest winner - by a huge margin - were growth stocks. So what are growth stocks and how are they different from value stocks? 

How Much Of Investment Success Is Luck?

Howard Marks on “Luck in Investing”Some of my regular listeners may recognize the name, Howard Marks.  He’s the 67-year old billionaire who co-founded investment management firm Oaktree Capital which manages about $84 billion in assets, mostly in alternative investments such as high-yield bonds and has delivered a whopping 23% average annual return over the past 25 years.Marks regularly puts out memos outlining his views and philosophies on a broad range of topics related to the investing business. One of his recent memos addresses the role of luck in investment success.Marks starts his memo with a quip from Jack Dorsey, the founder of microblogging platform Twitter, who recently tweeted that “Success is never accidental.  No accidents, just planning; no luck, only strategy; no randomness, just perfect logic.”This quip went against Marks’ grain.  Marks himself believes luck, circumstance and randomness play a huge role in success, and this tweet prompted him to address the issue of luck in the investing game in this recent memo.a great many things contribute to success. Some are our own doing, while many others are beyond our controlMarks says “A great many things contribute to success. Some are our own doing, while many others are beyond our control. There’s no doubt that hard work, planning and persistence are essential for repeated success. But even the hardest workers and best decision makers among us will fail to succeed consistently without luck.”The Components of Luck in InvestingMarks says the components of luck range from accidents of birth and genetics, to chance meetings and fortuitous choices, and even to random, unforeseeable events that cause decisions to turn out right.Luck, according to Marks and others, takes on many forms such as demographic luck and the Ovarian Lottery which is about being born at the right place, to the right parents, at the right time.For example, Warren Buffett says “I’ve had it so good in this world, you know. The odds were fifty-to-one against me being born in the United States in 1930. I won the lottery the day I emerged from the womb by being in the United States instead of in some other country where my chances would have been way different.”Buffett is insightful enough to realize (and secure enough to admit) that he isn’t solely responsible for his success. What if he’d been born in Bangladesh instead, or born a woman in 1930, or missed out on studying under Ben Graham at Columbia?  Luck played a role in making him who he is.Similarly, Marks believes there is luck in investing. He writes, “Performance is what happens when events collide with an existing portfolio. We arrange our portfolios in expectation of what we think will happen in the future… and get desired results if future events conform to our expectations… and less-desired results if they don’t.”He says, even if investors’ skillful analysis and reasonable assumptions are “right” in some abstract sense, it still takes a great deal of luck for their version of future events to materialize.He then quotes Elroy Dimson of the London Business School who said “Risk means more things can happen than will happen.” The future isn’t a predetermined scenario that’s sure to unfold, but rather a range of possibilities, any one of which may happen. And even the most rigorously derived view of the future is far-from-sure to be right. Many other things may happen instead.Even when we assemble our portfolios diligently, unpredictable future events determine whether our performance will be rewarded or punished. People whose expectations are borne out generally make money, and those whose aren’t lose.Sometimes, even though an investor’s projections are “wrong,” the investor may be bailed out by unforeseeable positive developments such as non-fundamentally based price appreciation. Marks says such an investor is “right for the wrong reason” (or just plain “lucky”).Alternatively,

How to Make Retirement The Best Years Of Your Life

with Robert Laura, Financial Planner, Author of Naked Retirement: Living A Happy, Healthy, & Connected RetirementRobert discusses topics he details in his book, “Naked Retirement” which aims to prepare people for retirement – not just the financial aspects of retirement but, more importantly, the non-financial aspects that can make all the difference between a good and a bad retirement. Everyone dreams of retiring, they see it as this Holy Grail when they’ll finally live the life they’ve always wanted… but sadly, only 40% of all retirees find happiness in retirement. There are tremendous positives to retirement but there is also a dark side… with depression, suicide, stress, loss of meaning, etc.So, in conversation with Steve, Robert shares the essence of his book and lays out the kinds of topics that people heading into retirement should think about ahead of time so they can make the most of their golden years. Robert offers simple exercises and worksheets that people can use to prepare themselves for this next phase of their lives where they are unburdened by distractions such as going to work, taking care of children, etc., and often end up not knowing what to do with all this free time unless they plan ahead.

The Biggest Discount Day For Closing A Home Sale

With Terry Story, 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLWould you believe it, they say the best day to choose when closing a home sale is October 8 to get the biggest discount on that day… now, really??!! Well, there doesn’t seem to be much logic to it but that’s what the data points to, and they also have these dates city by city – but don’t buy too much into it.  However, as far as minimizing pesky costs on closing a home, something to consider.Apparently, a lot of buyers want to close their home purchases on either the 15th or the 30th of the month, so there’s a fair amount of backlog and it’s crowded. So, as Terry advises, avoid shooting for those dates and pick a closing date that’s either in the first two weeks or after the middle of the month. She also advises against Friday closings because delays in paperwork move things to Monday and having that weekend gap can disrupt the closing process. As she puts it, delays on Friday can get really ugly.Terry also says mortgage loans can now be had for as low as a 3% down payment. But 20% is a nice number because below that level of down payment you have to take out extra insurance and that’s an unnecessary expense if you can avoid it. But look at the trend, if prices are rising, consider getting in early even with a lower down payment.

How Investment Decisions Are Influenced By Our Genetic DNA

With Dr. Richard Peterson, expert on Investor Psychology and Investment Decisions, Author of Inside the Investor's Brain: The Power of Mind Over MoneyDr. Peterson gives us a few insights on how our investment decisions are influenced and why we each react differently to exactly the same market information, with actions ranging from complete risk aversion to extreme risk taking. He discusses “asymmetric bias” and how investors can prevent over-reacting to low probability events to protect their portfolios. Steve gets Richard’s take on why “herd mentality” is so prevalent in investment decisions and how media-induced “emotional priming” results in metabolic changes inside our bodies which, along with our DNA, make us react differently to events.Dr. Peterson is a Behavoral Economist and researches how the brain makes stock trading decisions with unique insights into how the mind of an investor operates to make those investment decisions and how developing emotional awareness leads to long-term success.

10 Stocks Even The Pope Could Love

With Kathy Kristof, Contributing Editor – Kiplinger Personal Finance; Author – Investing 101In light of the Pope coming to America, Kathy took a look at the stock holdings of three Catholic values fund families - Ave Maria, LKCM Aquinas and Epiphany Faith and Family Values - which all base their investment choices on the ecumenical constraints of the church. That means barring investments in companies that facilitate abortions or produce pornography, among other things.Even with these exclusions, Catholic values funds have plenty of companies to choose from. So Kathy lists their top holdings and lists 10 stocks that savvy investors - and even the Pope - could love.

Avoid These Money-Losing Financial Moves

Now I know that a lot of my listeners and clients are well on their way to a comfortable retirement and are living fulfilling lives with all the joys of a steady job or business, a nice house of their choosing in a good neighborhood, and a good lifestyle with material and social comforts such as the ability to dine at nice restaurants, take nice vacations, socialize with wonderful people and indulge their desires for things like comfortable cars, elegant home furnishings, etc. - things that are nice to have and make for a rich, comfortable and fulfilling life.There are joys to buying new cars and high quality name brands, but only if you've got everything else taken care of.That said, I also routinely meet people who have had steady, well paying jobs but have still not managed to save enough for retirement, and are worried about their financial future.  And when quizzed about what they did to not be financially secure, I often see the same pattern repeated over and over – with unwise financial moves – mostly out of ignorance or an overly carefree live-for-today attitude – that kept them from saving and regularly investing for a financially-secure.There are joys to buying new cars and high quality name brands, but only if you've got everything else taken care of. In the meantime, be smart, pull yourself together and get in great financial shape.So here's a list of eight unwise financial moves that I came across in an MSN Money article that I wanted to share with you today. But before that, let me stress that some of these moves, like buying a fancy new car, do not apply to people who are financially secure but to those who don’t have enough savings and need to save more so they can build a comfortable nest egg.8 Tips to Get Your Finances in Order* Borrowing to buy depreciating assetsProblem: Your IOU becomes an OMG when your purchase loses value. That’s why the housing crisis was so devastating to many families. Everybody with an underwater mortgage – meaning they suddenly owed more than their homes were worth – learned this the hard way.How to avoid it: While homes typically increase in value, we generally know beforehand what’s going to lose value – almost everything. And borrowing money to buy things that decrease in value — like cars — is simply compounding the loss. That’s why — ideally — credit should be used only to buy those few things that generally increase in value: a house, an education, or maybe a business.* Buying a new carProblem: If consumers want to feel smart, they comparison shop, kick a few tires, and talk to a few salespeople in an attempt to get a decent deal. But even if they drive the hardest possible bargain, that new car is still guaranteed to lose thousands of dollars in value the second they buy it and drive it off the lot.How to avoid it: For starters, buy used, preferably from private sellers. And there is something of an art to finding a great used car. Check out tips and resources online with a search on “Tips for Buying Your Next Car for Less” or “Things You Should Check Before Buying a Used Car.”* Saving while in debtProblem: Savings provide a sense of security, but if you pay more interest on your debt than you earn as a return on your investments, you’re going backward. One possible exception could be debt that comes with a tax benefit, such as mortgage interest or some student loans.How to avoid it: As a rule of thumb, use low-interest savings to pay off high-interest debt. The reverse will gradually reduce your net worth. But don’t sacrifice peace of mind. If you’re in danger of being laid off or expecting a big expense, and retaining cash helps you sleep at night, that’s worth factoring in.* Buying name brandsProblem: In some cases, name brands are worth the extra cost.

Steve Answers Listeners’ Financial Questions

I encourage my listeners to write in with questions.  My mission is to protect and educate and so I always offer free 15 minute consultations to discuss any financial questions you have.  Often, people write in with questions, some complicated, some simple, so I decided to go through some of my favorites today.  I urge you to write in at any time by going to onthemoneyradio.org and clicking on Contact.  (You're already halfway there!)  Ask us any financial question you may have and we will get back to you.  That is my guarantee.Let’s begin.Here’s one I received just the other day, which I found to be quite interesting:Financial Question:A lot of women I talk to in their 50’s and 60’s these days are planning to live together when the time comes to really start cutting personal expenses - when we have to try to live on our often somewhat modest savings, investments and social security.How does a financial advisor help women who don’t own a lot, have a lot in savings or otherwise have access to wealth beyond their week to week existence?Financial Answer:A Financial Advisor can come in very handy in your situation. Helping you to shape a reasonable budget while making sure its realistic and won’t contain any nasty surprises in the future.He or she can help you look at the future and guide you on how to set up your estate in the most fair and tax efficient mannerThey can help you look at your insurance and perhaps save you money by getting rid of un-needed policies or restructuring the ones you already have.This is just the tip of the iceberg of arenas an experienced Financial Planner can help you with.As with the hiring of any professional, do your homework until you find one that will work best for you and charges fees within your financial capabilities. However, don’t be penny-wise and pound-foolish. Price is what you pay…value is what you get.You know, I often take time out of my schedule to answer complicated questions.  But some can be fun.  Even though the question might not fall EXACTLY into my area of expertise, I will still respond to the best of my ability.  Here’s one I had a lot of fun with:Financial Question:Help on selling art as a first timer?Hello,  I'm finishing up on an art piece, with the intention of selling copies; however I've never sold my art before (I should also mention I'm still in high school, and know little to nothing about selling/buying processes).Are there set guidelines in selling/making a profit in the art field? How I should price my copies, physical (or digital?) - I don't want to embarrassingly undersell myself, moreover set a misguiding precedent in prices.Any sites you recommend to provide the ordering/printing/shipping and handling process.Financial Answer:I have limited experience in the art market, but I would counsel you that when you are starting out, be less concerned about price and more concerned about getting into the market and finding a good mentor. Also, just meeting other artists will be extremely helpful. I'm sure there are plenty of resources on-line and there are good sites which curate and sell art works. www.artsy.net and www.saatchiart.com are two that come to mind.Good Luck and when you get your art on-line, send me the link, I'd love to see it.HIS RESPONSE:  Hi Mr.Pomeranz,My utmost thanks for replying!I should mention that very fitting to this situation, I'm currently taking a Business and Entrepreneurial course as one of my classes. Moreover, I also talked with my teacher about this, to which I got some helpful pointers (Breaking even with profit over production cost, establishing a precedent in price based on the amount of hours put in, etc.). However those things are leaning towards a market introduction, and as you said in your reply, focusing on finding a mentor should be my modus operandi. To which I raise a question of rookie curiosity...How impactful will a mentor be,

Now Is A Good Time To Find Your Dream Job

With Paul McDonald (http://www.roberthalf.com/blog/author/paul-mcdonald), Sr. Executive Director - Professional Staffing Services at Robert HalfPaul is an active blogger for his company, Robert Half, which provides temporary and permanent staffing solutions and advises corporations on salary levels for various positions. With unemployment down to 5.1%, Paul talks about salary and wage growth prospects going forward. He sees a war for good talent and says the current environment favors employees who are again in a position to command multiple job offers and negotiate higher salaries.  So, now would be a great time to go after that dream job you've always wanted.This employees’ market is driven by continued investments in innovation and technology that is driving demand for tech-savvy employees, mobile app developers, smart sales and marketing associates who understand today’s customers, and executives who can drive strategy and corporate culture where employees are looking for more a wholesome work, aka dream job, environment.

You’ll Be My Caregiver When I’m Old, Right?

With Kelli Grant (http://www.cnbc.com/2015/09/10/caregiving-is-becoming-increasingly-common.html), CNBC Personal Finance and Consumer Spending ReporterIn the past year, about 43.5 million American adults worked as an unpaid caregiver, the bulk of them to an adult age 50 or older, according to an AARP Caregiving report released in June. But the ranks of being a caregiver have shifted to include more men and young adults—a quarter of caregivers are millennials, AARP found. And the number of caregivers is expected to grow as baby boomers age into retirement.The caregiver need is 'growing and growing'. And it’s not just hands-on care: 8 percent of baby boomers, 13 percent of Generation X and 19 percent of millennials are financially supporting a parent, to the tune of $12,000 a year. Of those, 31 percent said they are also caregivers for that parent. Are you prepared should you be called on to become a caregiver?

Take Advantage Now, Before Federal Reserve Raise Rates

With Terry Story (http://www.terrystory.com/), 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLWith the Federal Reserve holding steady on interest rates this past week, it’s still a great time to take advantage of these low rates while they last.In real estate roundup, Terry addresses rental scams where scammers find an empty home or apartment, act as agents, meet potential tenants, then take their deposit and run. So make sure you don’t fall for such scams. Terry hands out a few tips on how you not to get conned and protect yourself.Also, this is a new trend – a big boom towards rental “housing” where home developers are now building single family homes just for rent. Partly because builders don’t really make a lot of money on starter homes but by renting, they save the property appreciation upside for themselves.

It’s Not Your Father’s Mutual Funds Anymore And That’s A Good Thing…

With John Rekenthaler, (http://www.morningstar.com/advisor/authors/john-rekenthaler.htm) Vice President, Research and Columnist with MorningstarJohn built Morningstar's retirement advice business from a start-up operation into one of the largest independent advice and guidance providers in the retirement industry, reaching more than 10 million participants and 63,000 plan sponsors. John also helped develop Morningstar's proprietary methodologies such as the Morningstar Rating for mutual funds, and earlier directed Morningstar's investment information products for variable annuities.John walks us through the history and evolution of the mutual fund industry over the past 60 years – from a murky industry with gimmick funds and questionable charges once as high as 8% and sales fees of 1% per year in perpetuity. Then things started to get more competition-driven with the advent of no-load funds, greater regulatory scrutiny and greater transparency. ETFs helped put more pressure on the industry, with lower cost and greater diversity to help investors better customize and manage their portfolios.

Did Dr. Dre Outwit Apple At Their Own Game?

I am a big fan of staying invested in stocks for the long run… but I am also a big fan of diversification… more specifically, diversification of your sources of income and retirement savings. So, for example, while I think everyone should take advantag...

If Presidential Candidates Can’t Manage Their Own Money, Should They Manage Ours?

With Aaron Leaman (http://www.signaturefp.com/news/), CFP, Chief Investment Officer – Signature FinancialWith the elections race heating up, Aaron analyzes how the field of Republican and Democratic presidential candidates manage their personal finances and retirement preparedness – basically how they handle their money – as a reflection of how they might manage the nation’s finances should they become president. And the field ranges from Scott Walker who has a negative net worth to Donald Trump on the other end with hundreds of millions in the bank.Aaron is a licensed financial advisor representative and a Chartered Financial Analyst whose primary responsibility is the management of investments, rather than clients. A student of Modern Portfolio Theory and a longtime proponent of working to match risk to reward, Aaron focuses his expertise on the development and ongoing performance of all client portfolios and investments. He maintains a day-to-day watch over conditions in the world economy and its various capital markets, and frequently works to research new and emerging companies, technologies, and trends.

Unleash Your True Potential With Steve Jobs Philosophy

With Scott Ford, CEO – Cornerstone Wealth Management, Blogger – “How to Live a Steve Jobs Life - On Your Own Terms (http://www.carsonwealth.com/insights/blog/how-to-live-a-steve-jobs-life-on-your-own-terms/)”As Steve Jobs famously said in his commencement speech at Stanford in 2005, after his diagnosis with pancreatic cancer, “If you don’t set priorities for yourself, life will live you, not the other way around. Remembering that I’ll be dead soon is the most important tool I’ve ever encountered to help me make the big choices in life…” he said. “Your time is limited, so don’t waste it living someone else’s life… Have the courage to follow your heart and intuition. They somehow already know what you truly want to become.”Scott discussed Steve’s philosophy of tapping into your subconscious and harnessing its power to uncover your deepest desires for your business and your life. It will unleash tremendous power in all that you do - not just in the future but right now, with the “Six Most” and “Vital One” exercises that transform your life as soon as you begin to use them. In the Six Most exercise, you identify your six top priorities for each day; and the Vital One is the big goal you must accomplish for the week.With experience in financial consulting since 1996, Scott is a respected financial advisor. Scott is the author of two books: Financial Jiu-Jitsu: A Fighter’s Guide to Conquering Your Finances and The Widows Wealth Map: Six Steps to Beginning Again. Scott is the creator of two processes that helps clients achieve their goals. The Way2Wealth is a personal and pro-active wealth management system that is designed to bring clarity and simplicity to the complex issues of financial management, and is complemented with Scott’s trademark philosophy, known as the “Six Pillars of Life,” which is the foundation in developing a unique and comprehensive financial planning process.

Why More Americans Need Life Insurance

With J. J. Montanaro, Certified Financial Planner - USAA (https://www.usaa.com/inet/pages/insurance_life_main?wa_ref=pub_global_products_ins_life)September is Life Insurance Awareness Month. So this is a great time to address a growing crisis of underinsurance, with too many Americans - more than 40% - without adequate life insurance; a time to educate Americans about the importance of life insurance and helping them get the coverage they need.Have you been contemplating purchasing life insurance, but aren’t sure if it’s something you really need or can afford? USAA certified financial planner, Joseph "J.J." Montanaro discusses how much life insurance coverage we all need, what age is the right age to purchase life insurance, why it’s often considered retirement insurance, and if it’s ever a good idea to purchase life insurance through your employer.JJ is a Certified Financial Planner. He is a native of Kansas City and earned his bachelor's degree in engineering from the United States Military Academy, West Point, N.Y. He holds FINRA Series 7, 63, and 65 securities registrations, and a member of the Financial Planning Association.

Home Buyer Alert! Your Monthly Mortgage Payments May Rise

With Terry Story (http://www.terrystory.com/), 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLWith almost sure signs of an interest rate hike in 2015, the housing market continues to stay strong with mortgage applications up 11% and refinancing up 17% as people move to cash in on low mortgage rates before they go up. There’s a line of buyers and a shortage of supply, and recent stock market volatility appears to have unfazed home buyers.So there is strong demand for new homes to fill the inventory gap… but builders don’t appear to be ramping-up supply because profit margins on lower end homes aren’t compelling enough for builders who remain focused on higher-end luxury homes.Federal Housing Administration home loans are getting a tuneup, with many changes going into effect Oct. 4. Under new rules, potential borrowers will likely save thousands at closing. But those monthly mortgage payments will be a little higher.  Terry talks about the new rule that is easier for consumers to read and understand, but could disrupt and extend home closings – so buyers and sellers should plan on some turbulence as these new rules settle into the home buying ecosystem, and pick lenders that can handle this transition.

Market Volatility Got You Down? Round Up The Usual Suspects

Wall Street's wild week ended with relative calm, but no trader or money manager is betting the lull will last. In one of the stock market's most chaotic periods in years, the benchmark Standard & Poor's 500 first plunged 11.2% in just six sessions stretching into last week, then roared back 6.4% over the next two days.It’s all about China and the FedThe two main issues dogging the markets are China's slowing economy, and uncertainty as to whether the Federal Reserve will start lifting its benchmark U.S. interest rate, currently near zero, starting next month. Now… recent gains in several areas of the U.S. economy indicate the central bank might go ahead and raise rates. But amid China's woes and the financial markets' turbulence, some speculate that the Fed will continue to wait.Defend against market volatility this fallAnd the ride will probably stay rocky for a while, as many veteran market watchers predict – with more triple-digit moves in the Dow in both directions, as we’ve already seen happen this week. Moreover, most equity strategists don't expect a quick recovery from the market's recent plunge, despite its head-turning rally last week.Market watchers say there's been technical damage done to the market, and that it "would be silly to think we're going to run up again to all-time highs all of a sudden.”As noted by my recent guest Sam Stovall, U.S. equity strategist at S&P Capital IQ, in the 11 times since World War II that the market fell by 5% or more in August, it continued to fall in September 80% of the time, and did so an average of 4%. So investors really should brace themselves against the 80% chance that stocks could fall in September.Consider stocks in defensive sectorsBut as James Peltz of the LA Times reports, even in down markets some industry sectors perform better than others. That was true last week, as tech, energy and "consumer discretionary" stock sectors finished with gains, including automakers such as Ford Motor Co., home builders such as Lennar Corp. and retailers such as Amazon.com.the sectors that held up best were the usual suspects - so-called defensive sectors such as telecom, consumer staples and utilitiesAnd as Sam Stovall put it, "The sectors that held up best — as Capt. Renault from 'Casablanca' said — were the usual suspects". They included so-called defensive sectors such as telecom, consumer staples and utilities whose products and services remain in demand even as global economies and markets are shift abruptly.The consumer staples sector includes food and beverage stocks such as PepsiCo Inc. and personal-products firms such as Kimberly-Clark Corp. "When times are challenging, it's usually those defensive areas that fare well," Stovall said.Utilities also attract buyers as a good defensive play when you have a really unstable market, partly because many utilities offer attractive dividend yields.But we all know it’s hard to time the market. So one alternative is to rebalance your portfolio with these types of defensive stocks — and stay invested through market volatility so you don't lose out on all the gains if the market rises, and don’t lose as much if it falls.In addition, sectors less influenced by China and the market's wild swings are another defensive way to stay invested. Sectors such as consumer-discretionary stocks such as Home Depot and Best Buy because U.S. economic trends mainly tend to drive consumer spending at these stores – which could also benefit from the strong dollar and cheaper imports from China.But regardless of whether it's China or other pressures weighing on the market, Sam Stovall believes “it typically takes five months for the correction to bottom and four months to get back to break-even" – so most likely, the volatility is here to stay. As Sam says "We've really only been in this correction for about three months because the S&P 500 peaked on May 21, and it's not going to be over any time soon."

7 Reasons Why the Market Went Nuts

With Jeff Cox, Finance Editor - CNBC (http://www.cnbc.com/2015/08/26/seven-reasons-why-the-market-has-been-totally-nuts.html)Jeff Cox is the finance editor for CNBC.com where he manages coverage of the financial markets and Wall Street. His stories are among the most-read items on the site each day as he interviews some of the smartest and most well-respected analysts and advisors in the financial world. He also is a frequent guest on CNBC.Over the course of a journalism career that began in 1987, Cox has covered everything from the collapse of the financial system to presidential politics to local government battles in his native Pennsylvania.In a recent article, Jeff lays out seven reasons why the stock market went “totally nuts” (http://www.cnbc.com/2015/08/26/seven-reasons-why-the-market-has-been-totally-nuts.html) in August 2015. He ties them to price discovery, the Fed, China, late-day sell orders, computer-driven trading, technical breakdowns and China again!

Is It Illegal If Your Landlord Wants Cash?

With Terry Story (http://www.terrystory.com/), 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FL“They’re back!” Millennials appear to be moving back in with their parents – to save enough for a new home, to payback student loans, etc. It’s actually not a bad thing to do for a couple of years. Terry also answers a listener’s question on the screening of buyers by a condominium association who can afford the house but don’t have the best credit. But, fortunately, this is a rare occurrence.Another listener was required to pay his rent in cash so the owner could lower his taxes. While cash payments are allowed, Terry advises lessees a.k.a. tenants on what they should do to protect themselves and make sure they aren’t victims of fraud or a bad lease.Finally, Terry fields a home owner’s question on foreclosure when he fell behind on a mortgage payment and was surprised by how little time he had before being served… not to Terry’s surprise. Find out why.

Americans Need to Boost Retirement Savings

With Greg McBride, Chief Financial Analyst, BankRate.com (http://www.bankrate.com/)BankRate.com (http://www.bankrate.com/) recently reported results from their survey on whether Americans were saving more or less towards their retirement accounts such as 401(k) and IRA. The good news is that 20% of all working Americans are socking away more towards retirement than last year… and there’s been a 50% drop in Americans who have not upped their savings… so that’s all positive.But there are trouble spots – with 10% saying they did not contribute towards retirement this year or last year – and that’s the highest in five years… so it’s a mixed report. Part of this can be fixed with workplace retirement plans and auto-enrollment. Moreover, contributions should go up as you near retirement – seamlessly and automatically, straight off the top before you get your hands on that money. So tune in to see how and why you should not ignore your nest-egg today.

Guard Your Portfolio Against Recent Market Volatility

With Sam Stovall (http://www.spcapitaliq.com/blogauthors/sam-stovall), Managing Director, U.S. Equity Strategy of S&P Capital IQ’s Global Markets Intelligence group; Author - The Seven Rules of Wall Street, The Standard & Poor’s Guide to Sector InvestingSam Stovall is an analyst, publisher and communicator of S&P’s outlooks for the economy, market, and sectors. He is the Chairman of the S&P Investment Policy Committee, where he focuses on market history and valuations, as well as industry momentum strategies.Sam’s a frequent guest on the show and talks about the recent volatility in global equities, whether this correction was on the cards, whether this was a pullback or a correction, and more. He correlates and benchmarks recent moves to long-term historical averages, and cautions investors to not get too complacent or over-aggressive with equities beyond their inherent risk tolerances. He also tells investors which metrics to focus on in times of high volatility to ride things out without causing long-term damage to their portfolios.

How To Get Free Services From Medicare

With Chris Abbott, Health Plan CEO at UnitedHealthcare (http://www.uhc.com/) Medicare and RetirementChris Abbott shares his views on Medicare and Medicaid as it marks its 50th anniversary, and the impact these government administered programs have had on millions of Americans in terms of quality of life and health.Steve tells us what we can expect from Medicare and what individuals can do to keep themselves healthier through Medicare’s free testing options for things such as heart disease and colon cancer that can be easily prevented if we focus on staying healthy and get regular checkups such as colorectal cancer screening, cholesterol and sugar testing, glaucoma testing, etc. He advocates health care over ‘sick care’, and urges wellness visits to stay fit.He also gives us tips on what people can do to get the most out of these free services, and talks about what these programs must do to stay cutting-edge, relevant and focused for the next 50 years.

What’s Causing Global Stock Market Meltdown?

As most of you know, it’s been an incredibly volatile week for stocks.Moments after the U.S. stock market opened on Monday, the Dow Jones industrial average had plunged nearly 1,100 points – a four-digit decline that is enough to jolt even the most...

What’s Next for U.S. Interest Rates?

With Luke Tilley, Chief Economist - Wilmington Trust (https://www.wilmingtontrust.com/wtcom/)Luke Tilley is a member of Wilmington Trust’s Investment Strategy Team, developing forecasts of the U.S. and international economies, as well as researching emerging issues to support and enhance the firm’s investment strategy. He oversees the firm’s effort in the macroeconomic forecasting area. Tilley is also responsible for communicating the economic outlook and investment strategy to clients and the public.Prior to joining Wilmington Trust in 2015, Tilley was economic advisor at the Federal Reserve Bank of Philadelphia. Earlier in his career, he worked as a senior economist at IHS Global Insight and as an economist for the U.S. Department of Housing and Urban Development.Here, Tilley shares his views on how the Fed will likely weigh recent market volatility, inflation trends and U.S. and global economic data when determining when to raise short-term interest rates. He also talks about China’s yuan deflation and what that really means for the U.S. and other trading partners, and how all this might impact U.S. markets near- and long-term.

Home Sales Steady And Strong Despite Low Inventory

With Terry Story (http://www.terrystory.com/), 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLHome sales continue to rise, at record highs, and good homes get snapped up pretty quickly. So, what should you do as a seller looking to trade up? Should you buy before you sell your primary home? And are you ready to stay in a “temporary” home for a considerable period of time until you buy a home that’s right for you, at the right price?And how will an increase in interest rates impact the housing market? Will higher rates kill demand or continue to pull in buyers attracted by near record-low rates? Are housing trends strong across the U.S. or in small pockets? And will the recent rout in stocks drive people to invest in homes as a rush to safety?

Behind The Making Of Xbox

With Robbie Bach (http://www.robbiebach.com/), Former Chief Xbox Officer, Author - Xbox Revisited: A Game Plan for Corporate and Civic Renewal (http://www.amazon.com/gp/product/1612548482/ref=as_li_tl?ie=UTF8&camp=1789&creative=390957&creativeASIN=1612548482&linkCode=as2&tag=onthmora-20&linkId=ISM5ZZHUXCTP2WFN)Robbie Bach joined Microsoft in 1988 and over the next 22 years worked in various marketing, general management and business leadership roles. Beginning in 1999, as Chief Xbox Officer, he led the creation and development of the highly successful Xbox video game business. Now in his new role as a “Civic Engineer,” Robbie believes we all have a responsibility to engage on civic issues and dedicates his time and energy to providing strategies, creative ideas, and consulting to organizations who are driving positive change in our communities. He speaks to corporate, academic and civic groups across the country and in 2015 completed his first book, Xbox Revisited: A Game Plan for Corporate and Civic Renewal.Xbox Revisited is a wake-up call, a challenge to every citizen to become a “civic engineer” addressing the challenges we face in our communities and across our country. Using the 3P Framework of Purpose, Principles, and Priorities developed by the Xbox team, Robbie takes business, non-profit, and community-engaged readers behind the making of Xbox—a triumphant saga from garage-shop beginnings to business success.Bach describes the process used to revitalize a beleaguered business in dire straits and applies it to civic engineering and a country adrift in a sea of challenges. Building off of lessons learned from two challenging days in 2001—the first when the original Xbox failed to turn on at its unveiling and the second on 9/11 as the terrorist attacks played out before our eyes—Xbox Revisited provides a simple yet effective framework to address even the most complex problems we face in our personal, professional, and civic lives.

How To Maximize Your Lifetime Social Security Benefits

With Craig Jaffe (http://www.unitedcp.com/), Senior Wealth Manager, United Capital Financial Life ManagementAs Wealth Adviser at United Capital, Craig uses his experience and analytical skills to help his clients navigate through their unique paths to maximize their lifetime social security benefits. In this segment, Craig walks us through various strategies, such as File and Suspend, which can help individuals, couples and divorcees manage and maximize their social security benefits. He also offers tips, tools and useful websites to learn more about and analyze various social security withdrawal options.For the next couple of weeks, I’ll be discussing Social Security in detail with expert guests. I want to make sure you’re getting the information you need, therefore I’m giving out a detailed social security analysis and strategy for free. If you’d like access to the analysis, simply request it by clicking here (http://www.onthemoneyradio.org/contact-us/) and filling out the form to request it. My mission is to educate and protect, so I invite you to take advantage of this information and know I’m offering this to you to thank you for listening.

Make Sure You’re Safe From The Dark Web

With Adam Levin, Chairman and founder of IDT911 (http://www.idt911.com/), Chairman and founder of Credit.com (http://credit.com)Adam K. Levin is a consumer advocate with more than 30 years’ experience in personal finance, privacy, real estate and government service. A former director of the New Jersey Division of Consumer Affairs, Levin is Chairman and founder of IDT911, Chairman and founder of Credit.com (http://credit.com).Adam is an expert on personal finance, credit, identity management, fraud and privacy. He writes a weekly column which appears in Huffington Post and ABCNews.com, as well as other major media outlets such as Yahoo!, AOL, MSN, and Business Insider. Adam’s passion is to educate consumers on personal finance, identity management and privacy issues.With hacking and online predators on the rise, Adam gives us 7 warning flags on how to protect ourselves from identity theft, online fraud, phishing and other scams.

With Stocks Falling, is it Time for Gold?

Gold prices kicked off the beginning of the 21st century and the new millennium, on January 1, 2001, at about $270 per ounce… and steadily rose 7-fold to a high of $1,895 on September 5, 2011 – with an annualized gain of about 18% per year for that 11 ...

America Voted: Real Estate is the Most Favored Investment

With Terry Story (http://www.terrystory.com/), a 25 year veteran with Coldwell Banker located in Boca Raton, FLBankRate.com recently released results from a survey that placed Real Estate as the #1 investment choice for American consumers when asked what they considered the best investment vehicle for money they could tie up for 10 years or longer. Real Estate was comfortably ahead of stocks, which placed third. Though American consumers are still concerned about jobs and the economy, survey respondents mostly feel good about their personal finances.27% of the survey’s respondents picked real estate, 23% picked cash investments (savings accounts, CDs, etc) and the stock market came in at 17%. Precious metals were at 14%. Bonds were farther down at 5%. 8% didn't like any of the choices, and 7% didn't have an answer.Terry tells us why she isn’t surprised, and why she is delighted, by the survey’s results. That said, on the show last week, Greg McBride of BankRate.com (http://www.onthemoneyradio.org/results-are-in-stocks-better-than-real-estate-cash-and-gold/) also explained why investors must really consider stocks for the long run as their best bet to wealth creation.Terry also tells us how lenders are relaxing standards and dropping credit score requirements significantly to encourage home ownership. And gives us the latest home improvement trends in American homes.

Questionable Annuity Sales Tactics Are Under Pressure

In December 2014, my commentary focused on the risks of annuities and I urged my listeners not to give in to the hard sell of annuities without reading the fine print.Annuity 101Here’s a quick recap.An annuity is a hybrid product that combines aspects of an insurance product and a mutual fund.Here’s how most annuities are structured: When you buy an annuity, the underwriter subtracts certain fees and expenses and does some math to come up with a fixed amount he can pay you each year… say that works out to $5,000 that you will receive each year for the rest of your life, without any adjustments for inflation. But over the course of say 20 years, with inflation at about 3%, the purchasing power of $5,000 drops significantly… to the equivalent of about $2,000 – so your annuity income stream does not keep pace with inflation and loses purchasing power significantly over time.There are different types of annuities, with the popular ones classified by an alphabet. Annuities with C shares and L shares generally offer investors the ability to withdraw their premium payments or exchange their contracts sooner or even immediately without paying a surrender charge. In the case of C shares, they generally have no surrender period during which an investor would have to pay a charge for such a withdrawal. But the investor generally pays higher ongoing fees for that early withdrawal benefit. And these products offer a rich compensation stream for broker-dealers and their affiliated financial advisers.Riders, which come at an extra cost, are added to annuity contracts to blunt the market risk in the product's underlying investments. They offer additional features, such as death benefits that protect income or withdrawals if the beneficiary lives longer than expected.Most annuities also charge fairly high fees – from 3.5% to 5% each year… so if your annuity earns about 5% to 7% a year… after fees, you only end up with a net yield of 1.5% to 3.5% each year. And the rub is that most of these fees go towards paying generous broker commissions… which is why annuity salespersons sell you pretty hard, often locking-you into unrealistic expectations.And should you choose to break an annuity, you’ll end up paying pretty hefty penalties. So, I had urged my listeners back then, if you’re considering annuities, research your options well – look into fees, commissions, payouts, inflation adjustments… and compare them to yields on simple or inflation-protected U.S. Treasury or high-quality corporate bonds that yield a bit more, don’t charge exorbitant fees and do not lock-in your money or have you pay hefty penalties on early termination.Annuity Regulation and Industry ImpactThen, in February 2015, President Obama proposed strict regulations that limit hidden fees, “back-door payments” and conflicts-of-interest – in a bid to reduce investment fees, expenses and biased investment advice, such as when some advisers steer clients into funds that pay high kickbacks but do not deliver superior returns.The proposed rule required financial advisers to act as “fiduciaries” for their clients and put clients' interests ahead of their own compensation or company profits.Regulatory pressure and negative coverage is beginning to have an impact on the less desirable aspects of the annuities industry.And it seems, all this regulatory pressure and negative coverage is beginning to have an impact on the less desirable aspects of the annuities industry. As a recent article by Trevor Hunnicutt outlined in InvestmentNews.com (http://www.investmentnews.com/article/20150729/FREE/150729865/under-regulatory-pressure-voya-restricts-sales-of-more-variable?utm_source=Morning-20150730&utm_medium=email&utm_campaign=investmentnews&utm_term=text&CSFlag=3i4c3kfjfsfa5pt3p54ob2q5f3), a leading purveyor of annuities - Voya Financial Advisors - has restricted sales of variable annuities for the second time in two months,

Can We Believe What China Tells Us?

With Michael Farr (http://farrmiller.com/our-team/michael-k-farr/), President of investment advisory firm Farr, Miller & Washington LLCSharp stock market losses in July 2015 have made China a recent hot topic, with Michael Farr weighing in on the implications of a sharp drop in China, the Chinese government’s attempts at controlling the decline and what the drop really means for China and the world economy. China’s also the next new worry after a debt crisis resolution in Greece (contentious as that might be) and agreement on conditions for the lifting of sanctions in Iran.Investors also worry about the believability of economic data coming out of China and try to make the most out of the manufactured data reported by the Chinese government. So is China really growing at the 5% - 6% rate the government claims or is it time to head for the exits with investments in that country. Also, what do commodity price drops reflect on China demand for raw material for infrastructure development?

5 Critical Things You Must Know About Social Security

With Sharon Epperson (http://www.cnbc.com/sharon-epperson/), Senior Personal Finance Correspondent - CNBCSharon Epperson covers the many facets of how people manage, grow and protect their money. Her expertise includes saving and investing for retirement, paying for college, managing mortgage, student loan, credit card and other debt, and building a financial legacy through estate planning. Her book, “The Big Payoff: 8 Steps Couples Can Take to Make the Most of Their Money-and Live Richly Ever After”, was a finalist for the Books for a Better Life Awards, honoring works that have "changed the lives of millions."With Social Security in its 80th year, Sharon talks about the steps everyone – young and old – should take to know everything about the money that’s taken out of your paycheck and where it goes. She wants people to know what the payoffs are if you defer your social security benefits, and offers basic facts about social security – 5 things everyone must know about social security.For the next couple of weeks, I’ll be discussing Social Security in detail with expert guests. I want to make sure you’re getting the information you need, therefore I’m giving out a detailed social security analysis and strategy for free.  If you’d like access to the analysis, simply request it by clicking here (http://www.onthemoneyradio.org/contact-us/) and filling out the form to request it.  My mission is to educate and protect, so I invite you to take advantage of this information and know I’m offering this to you to thank you for listening.

Results Are In: Stocks Better Than Real Estate, Cash and Gold

With Greg McBride, Chief Financial Analyst, BankRate.com (http://www.bankrate.com/)With nearly two decades of experience in personal finance, Greg provides in-depth commentary and practical advice to consumers. And through Bankrate.com's Money Makeover series, he has helped consumers plan for retirement, manage debt and develop appropriate investment allocations.BankRate.com (http://www.bankrate.com/) just concluded a survey on what kinds of investments people prefer over time. And, surprise surprise, only 17% of all Americans believe stocks are where they should invest their money… coming in a distant third after real estate and even cash. And of those interviewed, young millennials were the most averse to stocks – perhaps because they’ve seen multiple crashes. And this despite solid math on stocks being the best bet over the long run while real estate has typically only kept up with inflation, while cash has just lose value to inflation year after year. So it’s time investors looked past short term volatility and risk and viewed stocks as their best bet to growing wealth over time. Greg also warns investors on bond funds, especially with interest rates poised to rise from their bottom barrel levels… but who knows when rates might finally start going up given renewed global growth concerns in places like China.

Your House Is Finally Worth What It Was In 2006

With Terry Story (http://www.terrystory.com/), 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLReal estate has been on the up and up, and existing home sales and prices have now surpassed 2006 levels which was near the height of the housing market. This past spring was the hottest selling season since the downturn, and the momentum has continued into the summer. Home sales and median prices have risen sharply over the past year, pretty much across the U.S., and the West Coast is still the most expensive place to live in with prices up almost 10% over the past year. So affordability is now becoming a bit of an issue because higher prices also mean higher monthly mortgage expenses and increased home price appraisal issues.But rising home prices offer a lesson, especially for folks that lost their homes to foreclosure – that it pays to carefully evaluate your finances… and only buy a house you can truly afford to pay off, even through downturns and periods of extended unemployment. So folks should consider holding-off on buying that dream house… unless they can really afford it.And there’s change afoot. Effective October 3, 2015, banks have to give their documents to a buyer at least three days before closing – to give them a chance to review what they are signing. While this is a good consumer rule, ground reality reflects last minute changes all the time… so this rule is going to push out closings and upset home moves initially, but things should iron out over time.

America’s Growing Wealth Gap

with Jamie Johnson (http://en.wikipedia.org/wiki/Jamie_Johnson_(filmmaker)), Documentary Film Producer (“Born Rich”, “The One Percent”)Jamie Johnson is the great-grandson of Robert Wood Johnson, the co-founder of Johnson & Johnson (J&J), a company’s that’s worth over $300 billion. Jamie himself is estimated to have a net worth of about $600 million. Growing up in a family that inherited its extreme wealth, money and a host of other topics were taboo.Young Jamie, however, saw this as a problem and wanted to highlight the issues faced by the “generational” ultra-rich because he felt that “not talking” about key issues only handicapped such generations from succeeding in business, financial planning, family stability, money matters and a lot of other issues. Jamie produced two films where he explores these taboos and America’s growing chasm between the rich and poor. He believes many of these issues are specific to inherited wealth and do not apply to billionaire entrepreneurs and first-generation wealth creators.His films offer greater transparency into the ultra-rich and could be pioneering in bridging the psychological and emotional disconnect between America’s rich and poor. He also discusses the suitability of free markets in addressing these broader wealth-gap issues. 

Simple, Smart Investing: How Investors Can Simplify Investing and Boost Returns

with Ian Kennedy (http://simplesmartinvesting.com/), Former Director of Investment Research at Cambridge Associates and Author of “Simple, Smart Investing”Ian Kennedy served as the Director of Investment Research at noted equity research firm, Cambridge Associates, for several years and has studied market movements and investor performance through multiple bull and bear markets. Ian has compiled his insights in a new book titled “Smart, Simple Investing” where he walks investors through the pitfalls of investing and the secrets to doing it right. Steve likens his book to a “How to Invest Guide - For Everyone”, with nuggets of wisdom that Steve wholeheartedly endorses for the most part… heck, Steve should’ve written this book but Ian beat him to it!In this segment, Ian discusses the pros and cons of letting experts manage your money, what to look for when selecting a financial advisor, what you need to know to succeed as a D-I-Y investor and how best to diversify your portfolio in a global world. He also busts widely prevalent myths on investing and shows you how to cut through the noise to focus on long-term investment success. This 12-minute segment could significantly change the way you manage your money - the simple, smart way.

Are You Cut Out to be a Landlord?

With Terry Story (http://www.terrystory.com/), 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLOften times as we move or upgrade our homes, we are faced with a choice – do we sell the house or do we rent it out? Terry sheds light on how to rationally approach this question - with pros and cons that cover hard financial facts and the softer side of successfully being a landlord. While passive income is great – and being a landlord seems like an easy way of doing so – don’t be fooled. Real estate comes with a lot of risks such as non-payment of rent, long terms of vacancy between tenants, maintenance, physical inspections, tenant violations, etc.So real estate involves expenses you cannot escape such as property taxes that must be paid irrespective of whether you have the property rented out or not. So before you jump in, consider the alternatives, such as stock index funds where you literally don’t have to life a finger and can see your investment grow steadily over time.And, switching gears, home prices were rocketing higher at about 12% annually but seem to have tapered off to about 4% to 5% annually. So is this a slowdown or is this a healthy taper? And with prices up so much, are we now in a housing bubble and is a crash on the cards or will prices continue to rise sustainably for the foreseeable future?

Understanding the World’s Greatest Investors

With Frederik Vanhaverbeke, Author – Excess Returns: A Comparative Study of the World’s Greatest Investors (http://www.amazon.com/gp/product/B00L80QE2Y/ref=as_li_tl?ie=UTF8&camp=1789&creative=390957&creativeASIN=B00L80QE2Y&linkCode=as2&tag=onthmora-20&linkId=2AOI346JXSOUS3Q5)It is possible to beat the market! Taking this as a starting point, Frederik’s book - Excess Returns - sets out to explore how exactly the most famous investors in the world have done it, year after year, sometimes by huge margins.Excess Returns is not a superficial survey of what investors have said about what they do. Rather, Frederik applies a forensic analysis to hundreds of books, articles, letters and speeches made by dozens of top investors over the last century and synthesizes his findings into a definitive blueprint of how exactly these investment legends have gone about their work.Learn of the striking similarities in the craft of great investors, crucial subtleties in their methods that are ignored by many, and the unconscious errors investors commonly make and how these are counter to successful investing.

The Charles Schwab Guide to Finances After 50

With Carrie Schwab Pomerantz (http://www.schwab.com/public/schwab/resource_center/expert_insight/ask_carrie), Senior Vice President, Charles Schwab & Co., Author – The Charles Schwab Guide to Finance After Fifty (http://www.amazon.com/gp/product/B00FO60EMO/ref=as_li_tl?ie=UTF8&camp=1789&creative=390957&creativeASIN=B00FO60EMO&linkCode=as2&tag=onthmora-20&linkId=HMV24PJC3RJOAS7C)The financial world is more complex than ever before… and with competing financial priorities, fewer pensions, and more economic volatility, today’s fifty-somethings face more challenges than previous generations.Drawing on 30 years of financial experience, questions from her syndicated Ask Carrie column, and the latest guidance from the Schwab Center for Financial Research, Carrie Schwab-Pomerantz tackles today’s complex challenges and offers clear, straightforward advice in her new book, The Charles Schwab Guide to Finances After Fifty.

Home Equity Loans Make a Comeback

With Terry Story (http://www.terrystory.com/), 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLBelieve it or not, most people looking at buying new homes in the U.S. have one must have that’s on top of their list… and that’s… high speed broadband… of all things, especially in rural and less connected parts of the country… either because they need that broadband connection for work or simply, more likely, just want to watch Netflix!And as home sales continue to rise, especially as rental economics make less and less sense, there’s good demand for homes. Easier lending standards have made it easier for more people to now get loans, even people with lower than ideal credit but good employment histories. In addition, with home prices now well above what they were in 2008, home equity loans are again back in fashion – with competitive rates and interest only loans for the first 10 years of the loan.Finally, Terry answers a listener’s question about whether a hot-tub needs permission from your HOA.

S&P 500 Trumps “The Donald”

It seems the silly season is in full swing as presidential contenders jockey with each other to capture our attention in the media. So far, no one has done this better than Mr. Donald Trump. Now, his Net Worth has been the subject of much speculation and light on facts but Mr. Trump puts his numbers at $10 billion or more. So researching this point further, I came across an article by Karla Bowsher on MoneyTalksNews.com (www.moneytalksnews.com/why-youre-probably-better-investing-than-donald-trump/) which took a more interesting tack, I thought. It calculated what he would be worth today if he had simply invested in the S&P 500 rather than followed his own investing ideas as a Real Estate Magnate.So here’s a little tidbit on him. Trump got a big head-start in life because his father, Fred, was a multimillionaire New York real estate developer… and, to give credit where it’s due, The Donald did grow what he inherited and created a fortune of his own.But what if he’d simply stopped working 30 years ago and invested all his money in a simple S&P 500 Index fund; What would he be worth today?At a high level, here are the numbers. Trump is estimated to be worth about $4.1 billion in the latest “Forbes 400” list, which puts him in the No. 133 spot of the richest folks in America. But in a recent press release, The Donald says he’s worth about $10 billion – so fine, let’s give him the benefit of the doubt and assume his net worth is $10 billion.Now, Trump was also on the Forbes 400 list in 1982, when the magazine published its first annual list of America’s wealthiest citizens. That year, Forbes estimated Trump’s fortune at over $200 million but also acknowledged that Trump claimed it was $500 million. I guess there’s a pattern here, would you agree? So, again, let’s give Trump the benefit of the doubt and assume he was worth $500 million in 1982.Now, if Trump had retired in 1982, sold his real estate holdings and invested his $500 million in the S&P 500 Index, his money would have grown at an annualized rate of about 12% from 1982 through the end of 2014, assuming dividends were reinvested.Considering that Trump has not always been as shrewd as he’d have you believe, especially considering he’s filed four corporate bankruptcies since 1982, would he have been oin better financial shape had he just sat back and  put his money in a simple index fund? Would he have been worth more than the 10 Bill?The answer in one minute.More relevantly, can you do what he didn’t? Harness the twin tools of stocks investing and compound interest? Yes you can.While few of us have the resources to invest in each and every stock of 500 of America’s largest companies, nearly all of us have the ability to do so through mutual funds, like an S&P 500 index fund through plans such as your 401(k) or personal brokerage account.So, if you decide to take on more risk and chase The Donald, you will need to make a couple of important decisions:#1. First, pick an asset class. You could buy stocks or bonds, or choose from a slew of other alternative investments. But, to keep things simple, there’s nothing wrong with sticking with just stocks and bonds.And many experts urge average investors to put their money in mutual funds rather than buy individual stocks and bonds because not everyone is equipped to truly analyze stocks and bonds. Instead, you’re better off choosing a stock mutual fund, a bond mutual fund or a portfolio of mutual funds that includes both stocks and bonds.But in the long run, stocks offer a greater rate of return than other asset classes such as bonds. Stocks have delivered average returns of 8 percent to 10 percent annually over the last 100 years, which is more than any other asset class – and this higher return can simply be attributed to the fact that stocks entail greater risk than bonds and participate in the growth of the United States which happens in fits and starts.

The Housing Market is Red Hot

With Terry Story (http://www.terrystory.com/), 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLExisting home sales grew at the fastest pace in nearly 8 years to 5.49 million homes per year, with home prices hitting new highs since 2007. Terry attributes this to a steadily improving economic environment in the U.S., higher employee confidence, low interest rates and easier lending standards. With low inventory, there are now frequent bidding wars, a nice 180 degrees from when houses went unsold for up to 15 months. So that’s good news for just about everyone including buyers even though they do have to pay a bit more to get the house they want.Terry also talks about the slight drop in foreign buyers as their home currencies – Canada, the United Kingdom, China, India and Mexico – fall relative to the U.S. Dollar, which is a bit of good news for U.S. buyers because they now face marginally less competition from cash rich international buyers.Finally, Terry addresses a landlord’s question about a tenant not maintaining a rental property despite paying rent on time and generating complaints from other home owners in the neighborhood.

5 Tactics to Help Patient Investors Prosper

With James Glassman (http://www.kiplinger.com/fronts/archive/bios/index.html?bylineID=44), Contributing Columnist – Kiplinger’s Personal Finance, Author - Safety Net: The Strategy for De-Risking Your Investments in a Time of Turbulence (http://www.amazon.com/gp/product/0307591263/ref=as_li_tl?ie=UTF8&camp=1789&creative=390957&creativeASIN=0307591263&linkCode=as2&tag=onthmora-20&linkId=ZE32FZUNF3QJPJIN)How can you construct a financial investment strategy to protect yourself during these turbulent times…yet still get the growth you need to ensure a solid financial future and comfortable retirement? The answer lies in building an investing safety net that gives you the gains while offering protection against the downside. When turbulence strikes, Jim’s tips will help you avoid the financial nightmares of recent years when portfolios and 401Ks were devastated.Jim provides the specifics you need for shrewd asset allocation such as by how much to reduce stock ownership, ensuring the stocks you own meet the right criteria, how to invest in bonds to diversify your portfolio and hedge against a decline, and own funds based on other currencies.Jim’s five principles and 18 rules help keep the “animal spirits” in check when fads and news flashes tempt you, and keep you from making rash investing decisions you may later regret.

Lifting the Veil on China’s Stock Markets

With Tom Easton (http://www.economist.com/mediadirectory/tom-easton), American Finance Editor and China Expert at The EconomistFollowing a 30% drop in Chinese stocks within a few weeks, Tom Easton gives us insights on the drivers behind China’s economy and markets, and lifts the veil a little so we can better understand China – a major player in the global economy.Tom’s been watching and reporting on various aspects of China’s economy such as wild movements in commodity prices, rampant speculation with borrowed money driving up prices, systemic imbalances, the Chinese government’s attempts to introduce limited free market policies while still retaining an iron grip on the markets and how the psyche of the Chinese people influences the economy in ways that are very different from what happens in the western world.

Pending Home Sales at 9-Year High

With Terry Story (http://www.terrystory.com/), 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLPending home sales hit their highest mark in nine years and that’s a good thing, because pending home sales is a forward looking indicator on signed contracts – so things are looking up for the housing market with U.S. consumers buying homes… and this reflects a deeper reality – that Americans are increasingly comfortable with their long-term employment prospects and are bullish about where the economy is headed. But rising home sales have other implications, such as more competition for the few homes in the market and rising prices – which is great for sellers but not so good for buyers.And, in the Real Estate Roundup section, Terry answers questions related to renters living in homes that are going into foreclosure – their rights, their options and what the law says in such matters. More importantly, find out what you should do before you rent so you don’t face rental problems down the road. And gives us a 3-part checklist on what sellers need to do before they put their homes up for sale.

Common Questions on Retirement Planning

With Donna Rosato (//time.com/author/donna-rosato-3/), Senior Writer at TIME MONEY on Career Strategies, Retirement PlanningDonna Rosato has spent a lot of time studying and writing about financial planning and financial issues faced by retirees. In this segment, Donna answers readers questions on topics that range from social security rights for divorced spouses, asset allocation for retirees so they can sail through life’s various challenges, the safe level of emergency cash reserves (fyi – it’s not the same as what you’d set aside if you were younger, healthier and had a regular paycheck coming in!) and how to build-up that cash safety net and making it grow.Donna also addresses questions from single moms who have no retirement savings and want to know what their options are, listeners who want to know if their dividend income counts towards retirement savings, and picking funds in 401(k) plans to minimize fees and expenses.

Flashing Red Signs from China’s Markets

With Lei Mao (http://www.wbs.ac.uk/about/person/lei-mao), Assistant Professor at Finance at Warwick University (UK)Chinese stocks have taken a big hit of late – with markets down 30% within a few weeks. But, to put things in perspective, Chinese shares have almost doubled over the past 12 months so even with a 30% drop, shares are still up about 65% for the year – and that’s a super-fantastic year in any stock market. But does this sharp selloff signal trouble in China? And how does a slowdown in China impact global and American companies?Prof. Mao gives us an insider’s view on the quality of data coming out of China, why we should be concerned about what China is doing to drive economic growth and how leverage can be dangerous for the stock market and economic fundamentals… in ways that many economists believe are not sustainable over the long run. China’s all-powerful government also gets to set its own rules, pretty much – and that’s another thing that worries free market advocates who well know that governments can control stock and commodity prices only so long before market forces kick in and cause havoc.

Prepare Your Stock Portfolio for Higher Interest Rates

Last week, I spoke about low interest rates and how investors could adjust their fixed income holdings to prepare for the inevitable uptick in interest rates.See, it’s been nearly a decade since investors have had to contend with the Federal Reserve raising interest rates. And, going by recent comments by Federal Reserve Chairwoman – Janet Yellen – the Fed will almost certainly raise interest rates by a notch – 0.25% - sometime in the second half of 2015, with Fed watchers expecting a rate hike in the September timeframe. Economists then expect the Fed to raise interest rates in a measured manner, leaning on the side of caution so as to not upset our recovering economy.So, with an uptick virtually a sure thing, it’s time investors prepared their stock portfolios for a rising interest rate environment.Arguments for a Continued Bull MarketUltra low interest rates have led to extensive low-cost borrowing, and this borrowed money has been plowed into investments that have powered the stock bull market since March 2009. So what happens if money gets more expensive when rates go up?On the one hand, strong unapologetic bulls say the stock market believes in Janet Yellen and her accommodative monetary policies, and believe a gradual raising of rates will continue to drive and improve the U.S. economy… which they reason, will drive stronger corporate earnings and, consequently, take share prices even higher. And these bulls point to the fact that historically, some of the best and most consistent stock market returns occurred when interest rates were rising from very low levels – much like the current scenario.What's more, market bulls note that one of the biggest threats to stocks and bonds in the long run is high inflation. So if one of the motivators of a rate hike is to battle the threat of inflation, then inflation is less of a concern… so, in theory, that should hold down longer-term interest rates and bolster stocks.What the Bears SayIn the opposing camp are analysts who have studied the impact of central bank policy on markets. They note that, historically, the stock market's performance is dramatically better when the Fed is in an expansive period and lowering rates to enable cheaper borrowing than when it’s in a restrictive period and raising rates to raise companies' borrowing costs and head-off inflation. In this higher or rising rate environment, cash and new bonds pay more, offering more competition for stocks.And although some bulls believe the Fed will stop raising rates after just a few small rate hikes, analysts believe that it's not the level of rates that matters but the direction they’re headed in.It's also worth noting that the global economy and markets have never been in the situation they're in today, which makes it tougher to imagine what's next. For one, even if the Fed begins to raise rates, central banks in much of the rest of the world — including Europe, Japan and China — show no sign of following suit. That could act as a weight on U.S. bond yields if foreign investors turn to the U.S. for better yields because their buying of U.S. bonds could hold or drive-up prices and weigh on yields.But while I don’t think investors should abandon U.S. stocks just because rates are going to go up, I do want you to prepare for a rockier road for equities as the economic expansion ages, specially with many stocks richly valued relative to earnings.So look at your holdings and consider selling or hedging stocks that appear rich or over-valued, and consider focusing on many fairly-valued stocks, including some big name U.S. stocks that benefit from economic growth at home and abroad.Now, another factor to keep in mind is that rising interest rates could lead to a stronger dollar and this makes U.S. exports more expensive for international buyers and reduces repatriated corporate earnings when the dollar is higher than most other currencies.

How to Survive A Major Stock Market Crash

The implications of major recent and past events and their impacts on the financial markets – everything from the depression in 1987 to the more recent flash crash.

Financial Planning for LGBT and Nonconventional Couples

The financial implications of the Supreme Court’s ruling against a ban on same sex marriages.

Prepare Your Bond Portfolio For Higher Interest Rates

Predictions of investor reaction range from Armageddon to a nonevent.

Does Rental Property Ownership Make Sense?

It always sounds great when someone says they bought a home, rented it out and the rent pays the mortgage. But it’s not all that simple and not necessarily all that attractive.

iPhone Madness: The Story Behind The First Phone

With Andy Grignon, Veteran Software Developer at Apple and part of the rag tag group that developed the first iPhoneAndy Grignon has made a career out of creating and shipping highly visible consumer products. He started out at Apple in the Advanced Technology Group developing QuickTime Conferencing and QuickTime Streaming technologies. A couple small companies later, he was back at Apple building iChat AV and the iSight camera.He went on to write Dashboard for MacOS, prior to becoming part of the small, ragtag group charged with creating iPhone. After shipping iPhone 1.0, he left for Palm to co-invent webOS. As VP of Applications and Platforms, he oversaw the release of 13 versions of webOS.Andy discusses the excitement, chaos and madness of developing the iPhone under Steve Jobs, the new era of computing in the 1980s and the technological aspects of National Geographic’s new documentary – The 2000s: A New Reality - a two-night miniseries event that revisits key events of the decade through first-person interviews with the unexpected game changers, news makers, world leaders and entertainers who left their marks on history.

Financial Planning For Your First Child

As part of my live well series, I wanted to address the financial implications of having children, or more specifically, having your first child.  While becoming a parent is very exciting and fulfilling, it’s also significantly life changing in many ways… but here let me focus on the financial aspects of becoming a parent.Plan for Income ReductionWell, if you’re a two-income couple, one of the first changes you might face is a straight reduction in your wife’s income should she go on short-term or extended maternity leave.  This, of course, also depends on her employment status and the pregnancy-related benefits she receives… but for the most part, young expecting couples are faced with a sudden loss of income of the mother.  So make sure, as soon as you find out you’re going to become parents, you use the remaining seven or eight months before the baby’s birth to set your finances in order and rejig your lifestyle to accommodate a new person in your household and a drop in takehome pay.  In instances where the mother is not working, adjust your lifestyle for the added expenses of a new born.And, ideally, plan ahead as soon as you are married or in a relationship where the two of you would want children.Also speak with your employer to see if you’re covered by short-term disability insurance that could pay up to 70% of your gross income for about six weeks typically; also check with HR on your maternity benefits and make full use of them on things like your insurance co-pays… treat a pregnancy like any other medical condition and plan ahead for necessary out-of-pocket expenses.Plan for Baby ExpensesIn addition to loss of income, a baby comes with multiple expenses such as an added healthcare deduction from your salary, out-of-pocket hospital expenses for the mother and child, temporary periods of absence for the father that could also result in reduced pay close to the time of delivery and, of course, money for the baby’s clothes, toys, crib, formula, diapers, car seat and more.  You’re sort of hit by a mini tsunami of expenses when a baby is born so it’s best that you be prepared.Now, a lot of excited parents tend to get carried away and buy expensive cribs, expensive clothes and so on… driven by a noble thought where they want to give their child the best that they can afford… but, frankly, the child knows no better – a $1 toy from the Dollar Store is often as exciting and challenging as a $50 gift from your favorite baby store… and a fancy crib made of solid wood can easily be substituted by something that’s way less expensive… just focus on the basics and then some; give your child a comfortable mattress and a warm blanket and you’ll be fine.This is also a good time to look for used items – you can get excellent quality children’s items that other kids have simply outgrown and are going for a song.Use a Baby Shower to Get What You NeedSimilarly, use events such as the Baby Shower to ask for practical and inexpensive gifts so you get two or three really useful things in place of items that the baby’s really indifferent to... and in so doing, reduce your expenses by getting necessary and basic items.  Of course, we all want our kids to look cute and all, so go ahead and buy a few pretty clothes, but stick to thriftier stores if you can – they too have plenty good options that will not reduce your baby’s cute quotient!Instead, invest in things that matter – such as good quality diapers, good quality and healthy baby food and formula, a good car seat, etc.Take Advantage of College Savings PlansAs soon as you have a baby, you can also start socking away for baby’s education – with tax free contributions to Coverdell Education Savings Accounts (Coverdell ESA) and Qualified Tuition Programs (QTPs or 529 Plans) that let you invest today so the money grows tax-free and can be withdrawn tax-free provided funds are used for qualified educational expenses such as tuition, educational supplies,

When to Buy Used Stuff

With Cameron Huddleston, Contributing Editor at Kiplinger Washington Editors, Author – Daily Kips Tips at Kiplinger.comAs part of Steve’s Live Well Series, guest Cameron Huddleston helps listeners decide when and what to buy used versus new. Used goods are certainly way less expensive than buying new, and can help people live better within tight budgets, provided they are realistic and willing to make a few sacrifices.But buying used goods is not always a good idea (think mattresses, think bed bugs). Some things are simply just better new, but a lot of what we pay top dollar for is often a good candidate for used not new. And it’s not always about the money… sometimes, buying used can help you get something you may not otherwise be able to afford, and significantly up your lifestyle. So tune in for great ideas on how you can save money buying used items, while sometimes actually living with higher quality items!

The Silent Housing Crisis

With Terry Story, 25-year Veteran Real Estate Agent with Coldwell Banker in Boca Raton, FLA recent report alluded to the Silent Housing Crisis that spoke about rising rental prices, specially places like San Francisco and New York where renters are paying 30% to 50% of their income to stay in rented houses – that’s a lot! But builders see this, and have responded by ramping up the construction of multi-family homes. Even so, new home supply takes a while before it’s available for rent but new rental construction, especially in hot markets, should alleviate the Silent Housing Crisis when it comes to rentals.In other news, first-time home buyers are jumping into the housing market in record numbers – partly helped by low interest rates, down payments as low as 3% to 5% and a relaxation of credit rules to enable easier but not riskier home loan origination. But borrowers beware, lenders have little tolerance for lies on home loan applications so make sure you don’t try and game the system.

23 Golden Rules for Investors

You can't see the future through a rear-view mirror.

CNBC’s Bob Pisani on Greece’s Debt Crisis

What the failure of Greece could mean for the rest of Europe.

A Case for Legalizing Marijuana

Is marijuana going to be a new major market like cigarettes and alcohol, or are some states going to draw the line?

Rising Mortgage Interest Rates and Boomerang Buyers

Interest rates aren’t likely to rise too fast, likely stay in the 4% range on 30-year loans for 2015, which looks like free money compared to rates of 16% and more in decades past.

Taking Bubba Gump from Movie to Restaurant

Scott Barnett, Founder & CEO of the Bubba Gump Shrimp Company, takes us on an inspiring journey of bringing the successful restaurant from movie to reality.

5 Common Investing Mistakes

Here are five flawed investment strategies that your should be aware of, and check to make sure they’re not part of your investment portfolio.

Could The Security Breach At The IRS Prevent You From Buying Your Next Home?

The IRS recently reported that its computer and data systems were hacked and about 100,000 tax-payers had their tax return data compromised. Should you be concerned, especially if you’re in the market to buy a house?

How to Avoid A Tax Audit

Find out what triggers IRS audits, the penalties you may face, and how you should respond if you do get contacted on your taxes.

Index Funds & ETFs With Consuelo Mack

Consuelo Mack helps investors build diversified portfolios for long-term success.

Divorce: 3 Mistakes That Will Crush Your Financial Future

It can be hard to find money your spouse may have deliberately hidden, making the best remedy prevention.

The Rising Market for Ultra Luxurious Homes

There are over 300 homes for sale in the U.S. that are priced north of $30 million… with amenities like 40 car garages, mini golf courses and a whole lot more…

America’s Top Retirement Destinations

Choosing a retirement destination with a low cost of living can really help stretch a fixed income. But the place you select should offer more than just affordability.

Meet John Rogers – An Investment Legend

John’s passion for investing began at age 12, when his father began buying him stocks as Christmas and birthday gifts.

Think Like A Billionaire: 39 Quotes To Invest By

“Be fearful when others are greedy and greedy when others are fearful.”

How Technology Impacts Investing

Maria Bartiromo reveals why she left CNBC after 20 years for the Fox Business Network and helped build their brand just as she did on CNBC. Also, ever wonder why it still feels like jobs are hard to get?

Understand Your Investing Behavior

Shayna Steiner shares her insights on investor behavior impacts investing decisions. Those whose emotions are easily affected by good or bad news, and jump to impulsive investment decisions, this one's for you.

Rise Above Your Job Title

Know what is most important right now and focus on the vital purpose and value-added contributions that can help you stand out and stay ahead of the change curve.

Home Moving Scandals To Watch Out For