Investments tips in a volatile market

[TOGWT]

[FONT=comic sans ms,sans-serif]INVESTMENTS TIPS FOR 2008:

With all the turmoil in the market today and the collapse of Lehman Bros and Acquisition of Merrill Lynch by Bank of America this might be some good advice. For all of you with any money left, be aware of the next expected mergers so that you can get in on the ground floor and make some BIG bucks.

Watch for these consolidations in later this year:

1.) Hale Business Systems, Mary Kay Cosmetics, Fuller Brush, and W R. Grace Co. Will merge and become:
[FONT=comic sans ms,sans-serif]Hale, Mary, Fuller, Grace.

2.) Polygram Records, Warner Bros., and Zesta Crackers join forces and become:
[FONT=comic sans ms,sans-serif]Poly, Warner Cracker.[/FONT]

3.) 3M will merge with Goodyear and become:
[FONT=comic sans ms,sans-serif]MMMGood.
[/FONT]
4. Zippo Manufacturing, Audi Motors, Dofasco, and Dakota Mining will merge and become:
[FONT=comic sans ms,sans-serif]ZipAudiDoDa .[/FONT] [/FONT]5. FedEx is expected to join its competitor, UPS, and become:
[FONT=comic sans ms,sans-serif]FedUP. [/FONT]6. Fairchild Electronic s and Honeywell Computers will become:
[FONT=comic sans ms,sans-serif]Fairwell Honeychild. [/FONT]7. Grey Poupon and Docker Pants are expected to become:
[FONT=comic sans ms,sans-serif]PouponPants. [/FONT]8. Knotts Berry Farm and the National Organization of Women will become:
[FONT=comic sans ms,sans-serif]Knott NOW! [/FONT]And finally...

9. Victoria 's Secret and Smith &Wesson will merge under the new name:
[FONT=comic sans ms,sans-serif]TittyTittyBangBang [/FONT]

[/FONT]

 

[dengood1]

haha........funny!

 

[sal329]

Lol TOGWT you come off a serious person it is nice to see a post with a joke (please do not take that offensively at all)

 

[ScottB]

I needed this post after working thru all the financials and industry news.

 

[Smokin]

good one:Im the MAN

 

[PaintPolisher]

Thanks :goodpost:

al

 

[Surfer]

I needed this post after working thru all the financials and industry news.

You and I both

 

[YankeeFan]

Lol TOGWT you come off a serious person it is nice to see a post with a joke (please do not take that offensively at all)

Ditto

 

[Darren F]

Well if anyone wants some real advise look into a Fixed Annuity....They are guaranteed to never lose principal, tax deferred, can generated income for the rest of your life after you turn 59 1/2, they are asset protected and no probate if you die...

 

[Meghan]

Well if anyone wants some real advise look into a Fixed Annuity....They are guaranteed to never lose principal, tax deferred, can generated income for the rest of your life after you turn 59 1/2, they are asset protected and no probate if you die...

I like the idea of putting money away and not touching it till 59, just hope I make it that long to enjoy it!

 

[Bert31]

Well if anyone wants some real advise look into a Fixed Annuity....They are guaranteed to never lose principal, tax deferred, can generated income for the rest of your life after you turn 59 1/2, they are asset protected and no probate if you die...

If you decide on an annuity, just be very certain to investigate the fees. Fees and commissions on annuities can be insane. There have been cases where financial periodicals have reported where some the fees as high as 12% In that case, you are pretty much giving all the earnings on your investment to the insurance company/finance company. You would have done better putting your money in a no interest checking account over the years.

They also fund some fees as low as 1% which is comparable to the fees you would pay for no load mutual funds but with mutual funds you don't get the assurance of not outliving your money like with annuities. The industry average is 6% which in my opinion still eats too much into your earnings but I guess if you are really worried about outliving your money, then I guess it is worth it to you. I invest with no load index mutual funds. I realize there will be some times when my funds take a dip but when you have a long term horizon (probably won't retire for 40 years) you can take the good times with the bad times. I am still up a decent amount from one I first started investing after high school 13 years ago.

 

[ScottB]

the issue with annuities are across the board, and the post above is one that is not correct when dealing with a "fixed" annuity. "Variable" and "Indexed" annuities have CDSC charges (getting out early) and have a higher fee schedule on the backend versus the mutual funds purchased alone. That said they do offer some guarantees that your mutual fund portfolio doesnt and well worth the cost to some individuals. Does your mutual fund offer a high water mark for death benefit to survivors ?? Does your mutual fund offer a living rider ?? Does it offer an option to annuitize and guarantee a payment for the rest of your life once retirement or disability sets in ??

As for mutual funds, there are no load (which means no fee upfront) but yet higher costs in the rear where usually hidden in a prospectus that reads like a balance sheet and would need an accounting degree to decifer. In alot of cases paying for your mutual fund upfront makes sense and share class (A,B,C, Y)will determine costs and required holding periods. Obviously a well diversifed portfolio is a must and meeting with your advisor twice a year will bring additional understanding and can move holdings in a bad sector.

Now to finalize my rant, lets discuss "fixed" annuities. The only reason for such a vehicle is actually tax deferreral. Typically these programs offer a great teaser rate or a guarantee for a couple years, but have a drop off period on the backside where they can (and usually will) drop to floor rate. These are typically in the 2% area (floor) and always pay based upon long term bond rates, well under as thats what the annuity company usually purchases with them. The other benefit is most are protected by State Guarantee's also and thus if the insurance company fails then the insurers in the state all have to fund the losses.

Never take financial advice from a forum ... no offense ... look to a licensed individual or firm and check the licenses thru FINRA for added protection. Not knocking any of the posts before it but proper profiling and risk assessments are needed before steering anyone to a particular investment.

 

[Bert31]

and the post above is one that is not correct when dealing with a "fixed" annuity.

What was incorrect about it? All annuities have fees, otherwise financial firms would not offer them. You just need to make sure you watch the fees related to your investments, annuities particularily.

Never take financial advice from a forum ... no offense ... look to a licensed individual or firm and check the licenses thru FINRA for added protection. Not knocking any of the posts before it but proper profiling and risk assessments are needed before steering anyone to a particular investment.

You need to be careful here also. If you go to a financial planner who receives a commision off of products he sells you, you need to question if he is looking out for your interests or his interests. Here is where I tell people to be very cautious with annuities. Brokers love them due to the commision they generate. If you need professional advice, I would recommend going to a non commisioned, fee only investment advisor. This advisor will charge you by the hour and makes nothing off what you decide to invest in. He/she has not incentive to not be looking out only for your interests.

To take this one step further, educate yourself on investing so you don't have to rely 100% on someone else for your financial well being. In college I took an investment theory course which was outstanding and where I was first warned about checking out fee schedules of investments, particularily annuities.

Being a CPA I also used to work in public accounting with clients who had investments so I had to get training on the subject. I now am the head of financial reporting for two not-for-profits one of which has a $10 million endowment which is primarily in equities and fixed income investments so I have "kept up" with investing. Saying all that, despite all this formal training I have received, I still learn even more just doing my own research on the internet. Even the most novice person on investments could get a decent footing educating themselves but doing some searches on the popular financial websites. Almost all of them offer an area for beginners.

 

[ScottB]

fixed annuities do not have a typical fee schedule in the way you suggested above. The annuity company pays the brokers commision upfront (not the purchaser) and the interest is indeed inclusive of fee's and commisions but also tied to long term rates otherwise could not be competitive. In order to be viable they must offer benefits to entice clients from cds and other products. Tax deferral is one, annuitizing another, and obvious offering a floor rate similar to base interest rates is another. Thus the fee's are actually quite limited whereas on the variable annuity can be spread against the investment choices. An insurance company must keep these (fixed annuity proceeds) investments in very safe and guaranteed products to avoid exposure but it does allow them opportunities to divert more cash from other products (like car insurance) into the market for better returns.

As for your comment on not seeking the advice of a professional broker, or they will only entice you to what makes them money. Come on ... seriously most dont want complaints on their license nor will they stay in business for the long haul if complaints and settlements add up. Remember FINRA must report all complaints and even challenges even if resolved in brokers favor and thus a set of checks and balances in place for clients to use and I suggested it above. I guess the blanket statement that all accountants cheat the system and show clients how to avoid paying fair taxes would equate to your comment. I believe in all professions there is more good than bad !

The rules are simple for most individuals, you dont go to a broker for legal advice you visit your attorney. You dont go to your lawyer for accounting advice you visit your accountant. And you dont visit your accountant for investment advice you visit a qualified broker. They all should and can work in tandum to help grow a clients well being if the client carefully chooses each and asks for recommendations and checks their records. Infact in some states breaking this code can bring penalties and liability to that professional.

In closing as this is not one profession against another, it is giving the client more information which leads to better choice. I am all for a client doing their own homework and following thru, but the stats show that most dont do that (they give up as consumed by confusion) or the ones that do it on their own lose and give up. Using someone qualified is a good option but must be handled with care.

 

[Darren F]

I am an accountant and a licensed individual for Health Insurance, Life Insurance and Annuities....the annuity product I am talking about is one that I have my own money in. There are no fees at all, there are surrender charges if you want to withdraw more than the allowable 10% a year...It is also a 10 year product so you have to be willing to have it tied up for that long....If you want more information about it I would be more than happy to E Mail information to anyone that asks.

 

[Darren F]

to answer Killr.

1- If the annuitant dies there is a beneficiary and the beneficiary gets 100% of the annuity, all they need to do it provide a death certificate and it is yours, there is no probate to wait for.

2-If the beneficiary wants they can leave the money in the annuity until the contract ends instead of taking it all out.

3-there is a rider where you can take a guaranteed income out for the rest of your life without annuitizing the annuity....If by some chance you become confined you can actually double the income as well...

Something you didnt ask, if you become terminally ill or confined and dont want the double income, after the first contract year you can take out 100% of the annuity without any surrender charges....


it really is a great product, and like i said, if anyone wants more info i would be more than happy to e mail anyone additional information

 

[ScottB]

to answer Killr.

1- If the annuitant dies there is a beneficiary and the beneficiary gets 100% of the annuity, all they need to do it provide a death certificate and it is yours, there is no probate to wait for.

2-If the beneficiary wants they can leave the money in the annuity until the contract ends instead of taking it all out.

3-there is a rider where you can take a guaranteed income out for the rest of your life without annuitizing the annuity....If by some chance you become confined you can actually double the income as well...

Something you didnt ask, if you become terminally ill or confined and dont want the double income, after the first contract year you can take out 100% of the annuity without any surrender charges....


it really is a great product, and like i said, if anyone wants more info i would be more than happy to e mail anyone additional information

I highly agree with you Darren and indeed annuities are special products and offer alot of value to certain clients. We didnt even discuss the attachment legally to assets (cash) versus annuities protections. They must be sold by offering all the information, all potential risks, rewards, and as part of a diversified portfolio of asset management. Paying a little extra for something is valid in some instances and protection does have a price.

I should edit above ... FINRA is licensing for mutual funds, bonds, stocks and other investment vehicles. As Darren offered our annuity licenses are enforced , trained, and recorded by the State as Insurance policies. Since I have no complaints on either ... I hope all will forgive my late nite reply earlier.

 

[Bert31]

As for your comment on not seeking the advice of a professional broker, or they will only entice you to what makes them money. Come on ... seriously most dont want complaints on their license nor will they stay in business for the long haul if complaints and settlements add up. Remember FINRA must report all complaints and even challenges even if resolved in brokers favor and thus a set of checks and balances in place for clients to use and I suggested it above. I guess the blanket statement that all accountants cheat the system and show clients how to avoid paying fair taxes would equate to your comment. I believe in all professions there is more good than bad !.

I never said don't rely on professionals, I said (along with research of your own) rely on fee based (hourly) financial professionals sense they have no bias for what financial products you ultimately choose. This bias does not mean that they are dishonest and should be reported, it means they are naturally biased towards their own products, it happens to all of us.

Call up Sal Zaino right now and ask what the best sealant is. I feel pretty confident he would say Z-2, Z-5 and Z-CS. If you called Dr Ghodoussi (however you spell his last name) I have to believe he would say Opti-Seal. Jeff Brandt would say Jeff's Werkstat Acrylic Jett and Acrylic Jett Trigger. David Bynon would say Ultima Paint Gaurd Plus. The fact that these four are picking their own products, does that mean atleast three of them are liars? No, it means each of them have bias and for truely the best recommendation, one should read forums like this and see what those who have no affiliation with any of the vendors say. Granted even then you will get some disagreement but atleast each opinion would not be swayed by ownership of the product.

This bias is why so many people have begun seeking their CPA's advice in investing. This was an area CPA firms did not seek out (many don't want to go into this area as they feel it is not their expertise), clients sought them out for their advice. There were numerous reasons for this. The primary was clients felt they were being sold to rather than receiving financial advice which is a natural consequence when the broker's compensation ultimately is determined by if they sell their company's product or not.

Another reason was in Kentucky (and probably many other states) the requirements to sell investment securities are unfortunately lenient. There are many financial advisors who really shouldn't be giving financial advice but have jobs in the area because they know how to sell very well. The education, training and tests required by the American Institute of CPA's for their certification to offer investment advice (forget what it is called) is extremely rigorous and has earned quite a bit of respect in the investment community in that some financial institutions have hired them also.

 

[loudog2]

Just buy a seat at the Chicago Mercantile Exchange. Get a globex trading terminal at home. Dable in some Eurodollars, S&P's and live cattle. Make some money.:cheers:

Just kiding! I worked there for 10 years. Watched many people lose their clothes off there back. Everyone has a different opinion on how to save, or make money.

 

[ScottB]

Call up Sal Zaino right now and ask what the best sealant is. I feel pretty confident he would say Z-2, Z-5 and Z-CS. If you called Dr Ghodoussi (however you spell his last name) I have to believe he would say Opti-Seal. Jeff Brandt would say Jeff's Werkstat Acrylic Jett and Acrylic Jett Trigger. David Bynon would say Ultima Paint Gaurd Plus. The fact that these four are picking their own products, does that mean atleast three of them are liars? No, it means each of them have bias and for truely the best recommendation, one should read forums like this and see what those who have no affiliation with any of the vendors say. Granted even then you will get some disagreement but atleast each opinion would not be swayed by ownership of the product.

We will agree to disagree as post has gone way off original topic. Annuities are still a valuble option for clients and when sold properly can be a very vital part of an investment strategy. I implore you and others to reconsider annuities as part of their plan and yes understand the benefits and detractions before signing any contract.

As for the examples above, I think they are a little off base. Two of the three actual make their own product and have their name/reputation on the bottle. One is a rebottler. An investment broker doesnt have his name nor peformance on the product, but maybe by the backer of the firm depending on his employment. Your original bias on fee's in annuities drove to bias towards brokers fatten their paycheck with best money makers to brokers now only pumping their firms product as best. A brokers licensing opens them to sell most products and most study the best offers and ratings in order to complete the sale. An honest licensed financial advisor will derive additional business and referrals for doing the right thing for the customer and their goals, compensation, and book of business will flourish. I still believe most do it right and know for afact that I have and will continue to.

I hope you hold no harm to me, and I dont you. This post turned more into investments and I was in no way attacking you or your profession.