Every time I’ve talked with someone about their investment portfolio recently, the subject of owning bonds or bond funds has inevitably come up. Most of the time, the conversations about the fixed income (bond) portion of their accounts has been less than hopeful. And the cynicism/pessimism hasn’t been coming from me… Continue reading “What’s All the Fuss About Bonds Being a Lousy Investment?”
While we usually discuss investing in the context of retirement planning in 401(k)s and IRAs, I was recently asked by a young mother about investing $50k in her 1 year old child’s name. (Since it’s in the child’s name, the money has to be used for his benefit but since he’s a minor, the mother has control over how the money will be invested and spent on his behalf.) Here are some things to consider. Continue reading “How to Invest for Your Child”
Over the last few weeks, I’ve been writing about investing in rental real estate. I’m going to conclude this series with a final argument in favor of real estate investing and that’s how it’s likely to be affected by four different economic environments relative to other investments and the opportunities each situation presents to real estate investors. Here are the four different scenarios: Continue reading “How Real Estate Investors Can Take Advantage Of Any Economic Scenario”
One of the most common questions I get asked is how to divide your money between different types of investments. You’ve probably heard that 90% of investment returns can be explained by your asset allocation or how you divide your money between stocks, bonds, and cash. The problem is that asset allocation guidelines can vary dramatically based on where you look. So how do you decide? Continue reading “The 5 Things That Really Matter When It Comes to Investing”
Last week, Financial Finesse released our annual Generational Research Report and all I can say is, “I resemble that remark.” The good news of our findings is that my generation, Gen X, is getting better across all areas of financial wellness. The bad news is that we were the hardest hit generation by the Great Recession and we are lagging our counterparts in many areas, especially cash management. Continue reading “Why Gen X Isn’t Doomed”
Over the last two days, we discussed the Baby Boomers and the Generation Xers. Finally, let’s take a look at the newest generation to enter the workforce: the Millennials. Like the other age groups, not saving enough for retirement is the biggest vulnerability facing Millennials. However, they’re the only generation that doesn’t seem to know it as Millennials ranked more urgent needs like managing cash flow, getting out of debt, and investing as higher priorities. Here are some steps Millennials can take to strike a better balance between the needs of today and tomorrow: Continue reading “7 Steps For Millennials to Define Their Financial Future”
Yesterday, we provided financial tips for the Baby Boom generation. Today, we take a look at Generation Xers, who are suffering the double whammy of experiencing tough economic times at a particularly vulnerable financial stage of life. While most Millennials were too young to own stocks or real estate during those market crashes, and Baby Boomers enjoyed decades of growth in both assets throughout the 80s and 90s, many Gen Xers had the misfortune of starting their investing just as both markets were peaking. This comes at a stage of life in which a majority of Generation Xers own a home (translate: have a mortgage payment) and have minor children (translate: extra mouths to feed). So if you’re a Gen Xer, here are some moves to consider: Continue reading “7 Steps for Generation Xers to Reclaim Their Financial Future”
This week, Financial Finesse is releasing our second annual generational research report so over the next few days, we’ll be addressing in our blog how each generation can overcome their unique challenges and take advantage of the opportunities they face. Today, we’ll start with the Baby Boomers, the last of whom will be celebrating their big 5-0 this year. In addition to now being able to apply for their AARP cards for discounts on eating out and travel, here are some more critical tips for their financial wellness: Continue reading “7 Steps For Baby Boomers to Secure Their Financial Future”
The holidays present numerous financial challenges, not to mention the positive and negative stress associated with spending some quality time with friends and family. (Insert your own mental image of Cousin Eddie from Christmas Vacation here.) Generosity is a wonderful characteristic to possess, but if left without monitoring, it can lead to overspending and debt. Additionally, travel costs can be expensive if you hit the road or the occasionally friendly skies to be with family. There is a well documented outbreak of financial stress and regret that occurs every January in our consumer-driven culture when the reality of holiday spending arrives in the form of a credit card statement. Continue reading “A New Way For Couples to Manage Their Finances in 2014”
I recently read this article about how the real question in life isn’t what you want. It’s what pain you want. We all have unlimited wants, but what are you willing to struggle for? What price are you willing to pay? Continue reading “The Question That Will Determine Your Financial Success”
I began my career in 1994 as an enroller for a large 401(k) provider. From the moment I started, I was indoctrinated in the virtues of this particular savings vehicle. Things like “tax-deductible savings” and “payroll deduction” became everyday vernacular, and before you knew it, I was out there evangelizing the masses on the greatness of this extremely important part of the tax code. So imagine my chagrin when I learned that my beloved 401(k) has come under attack recently by some who are calling for its demise. Continue reading “In Defense of the 401(k)”
During a recent series of retirement workshops geared toward early and mid-career employees, I received numerous questions regarding the role of target date funds in their 401(k). This brought up an interesting discussion about hands-on vs. hands-off investing options. Target-date funds are supposed to provide simple solutions for people seeking an all-in-one fund that is diversified. Yet, a tremendous amount of confusion surrounds these seemingly basic asset allocation tools. Furthermore, not all target date funds are created equal so it’s essential to first look under the hood if target date funds are a part of your investment plan for retirement. Continue reading “Understand the Facts About Target-Date Funds”
We may have evolved to focus on the bad things in life (our more cautious ancestors were more likely to survive and reproduce) but today is a time to give thanks for the good things that we too often take for granted. This applies to our financial life too. Here are 5 financial blessings we can be thankful for this Thanksgiving and some steps you can take to make the most of them: Continue reading “5 Financial Blessings to Be Thankful For Today”
As Thanksgiving approaches, what are some things you have to be thankful for? Your health? Your family? Your friends? How about a new job? According to the most recent data released by the Bureau of Labor Statistics, over 200,000 people entered the workforce in October. Whether they are entering the workforce for the first time or found a new job after previous employment, many will be automatically enrolled in their new employer’s 401(k) plan. Continue reading “Automatic Enrollment Does NOT Mean Automatic Retirement”
Thanksgiving is right around the corner, and if you are like most traditional American families, you’ll probably eat too much, watch a game or two on the TV, and simply enjoy spending some quality time with each other. For some families, spending quality time together happens regularly, but for many, including my own, it usually only happens around the holidays. If that is the case for your family, one thing you may want to do this holiday season is discuss long-term financial goals. It may not seem like the most enjoyable topic of conversation around the dinner table, but with more and more uncertainty about the future, it may be one of the more important conversations you will ever have in your life. Continue reading “What You May Want to Discuss Around the Thanksgiving Table”
In one of the cooler things I’ve read lately, law enforcement authorities conducted a sting operation to nab a world infamous pirate. They had to draw him to them since they had very little chance of getting past his protectors. So, they created a fake premise of asking him to be an adviser to a movie about Somali pirates. He took the bait, went to them and was arrested. I’m guessing he is regretting that choice! Continue reading “Don’t Believe Everything You’re Told…”
A couple of weeks ago, I discussed the important role that our thoughts and beliefs can play when it comes to working toward important financial goals. While an optimistic outlook is associated with many positive outcomes related to our health and wealth, as with most things in life, moderation is the key when it comes to optimism related to our personal finances. Here are some questions to help determine if your optimism is helping or hurting your personal finances: Continue reading “Is Optimism Helping or Hurting Your Financial Plan?”
Emergency funds are the Rodney Dangerfield of financial planning: they get no respect. While financial experts typically recommend keeping at least 3-6 and sometimes even as much as 9-12 months’ worth of necessary expenses in cash reserves for emergencies, no one really likes seeing all that money sitting somewhere earning less than 1%. Here are some ways to make that emergency money work harder for you: Continue reading “How to Make Your Emergency Fund Work Harder for You”
I may have told you before that my daughter participates in the ROTC program at her high school. Over the summer, she joined the air rifle team and has been practicing for the last several months. I had a chance to watch her participate in her first competition this weekend. I must admit I wasn’t sure what to expect, but as I watched her and her team perform, I began to realize that there was a lot more to the sport than just putting a pellet in the chamber and pulling the trigger. Continue reading “Ready. Aim… Financial Plan!”
A couple of weeks ago, my colleague Linda Robertson wrote a blog post about annuities, in which she described how happy her father was about a variable annuity that she sold him when she was a financial advisor. That may sound a bit puzzling since variable annuities have gotten a lot of bad press due to their high fees. But for those fees, you’re basically buying some form of insurance, which is why they’re sold by insurance companies. Here are some situations in which an annuity might actually make sense for you depending on what you’re looking to insure: Continue reading “Are Annuities a Good Deal or a Rip-Off?”
