Archive - August 2017

1
The 7 Habits of Highly Effective Investors
2
Dangers of Taking Out a TSP Loan
3
High Exposure to Company Stock in Your 401K: Good or Bad?
4
Taxpayer Bill of Rights – Do You Know Your Rights?
5
Amazon, Whole Foods, and you

The 7 Habits of Highly Effective Investors

As Suzanne Woolley writes in her Bloomberg post, she’s identified seven habits of effective investors. I would agree with her on these habits.

  1. Save early, and automatically
  2. Expect financial emergencies
  3. Set an asset allocation, and diversify
  4. Keep fees low
  5. Use an advisor who is a fiduciary
  6. Spend less than you earn
  7. Maximize employee benefits

I would add Avoid leverage and Avoid speculation. You should invest within your risk tolerance and risk capacity. And, think long term for retirement investing and invest more conservatively as you come closer to needing your money for college, cars, or other financial goals.

Dan…

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Dangers of Taking Out a TSP Loan

Recently, Michael Kitces published an article titled, “Why Paying Yourself 5% Interest On A 401(k) Loan Is A Bad Investment.”  My first thought was, “If it’s a bad idea for a 401(k) loan, it must be even worse for Thrift Savings Plan loans.”  After all, the interest on a TSP loan is nowhere near 5%…it’s tied to the G-Fund interest rate.  At the time of this writing, that would be 2.25%.  In other words, that’s less than than half of the 401(k) loan mentioned in Kitces’ article.

But that’s not why I wrote this article.  After all, I …

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High Exposure to Company Stock in Your 401K: Good or Bad?

By Eve Kaplan, CFP® Professional

Is it good or bad to have a lot of employer stock in your 401k plan? It depends. Some employees accumulate company stock quickly because their company match is 100% company stock. Other employees load up on company stock because they’re bullish on their employer (and don’t fear an Enron-type recurrence). On balance, employees are holding a declining share of their 401k assets in company stock: less than 7% versus 19% in 1999*. This is generally positive trend but…in some instances it can make tax-sense to leave an employer with a heavy dose of company …

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Taxpayer Bill of Rights – Do You Know Your Rights?

bill of rightsThere is a set of Rights that are available to all of us as taxpayers – the Taxpayer Bill of Rights. This group of basic rights is available to us so that the government (and specifically the Treasury Department and the IRS) don’t over-step their boundaries when dealing with taxpayers.

It’s important to know your rights, and those set forth in the Taxpayer Bill of Rights can be very helpful if you’re having trouble working with the government. The rights scattered throughout the Internal Revenue Code, but are published in total in IRS Publication 1, readily available on the …

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Amazon, Whole Foods, and you

The takeover of Whole Foods by Amazon was approved this week, and we’re told that by Monday we could be seeing some big changes in the whole grocery business.  This has occasioned an awful lot of clothes-rending on the internet, and even Robert Reich (who I normally respect) has weighed in on what a terrible thing this is. Now Reich is a brilliant guy, and I’ve never been Secretary of Labor (although I’m pretty confident I could do a better job than the current incumbent), so I’m only going to argue here out of my own experience. I think the …

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