Warren Wealth Article Archive
Articles Posted During 01/2010
How And When To Sign Up For Medicare
Monday 01/25/2010 - 12:03:15 pm
Breaking down the enrollment periods and eligibility.
provided by Jacob Warren
Medicare enrollment is automatic for some of us. In fact, anyone who has received a Social Security check or 24 months worth of Social Security Disability Insurance (SSDI) is automatically enrolled in Medicare Part A and Part B.1 Part A is hospital insurance; Part B is medical insurance.
If you’re getting Social Security checks and approaching age 65, you’ll get a Medicare card in the mail three months before your 65th birthday. Medicare benefits begin on the first day of the month in which you turn 65. If you are getting SSDI (regardless of your age), the card will arrive coincidental with your 22nd monthly payment and you are entitled to Medicare coverage with your 25th monthly payment.1,2
Oh yes, there is another important criterion: you must be a U.S. citizen or a legal resident of this country for five years or longer to be eligible for Medicare.1
Some of us have to contact the SSA. If you’re coming up on 65 and not receiving Social Security benefits, SSDI or benefits from the Railroad Retirement Board, you can still apply for Medicare coverage. You can visit your local Social Security Administration office or dial (800) 772-1213 or go to www.ssa.gov to determine your eligibility. (If you’re going online, don’t just type in ssa.gov; you need the www. to get to the site.)
In this case, if you are eligible you have the choice of accepting or rejecting Part B coverage. If you want Medicare Part A and Medicare Part B, then you should sign your Medicare card and keep it in your wallet. If you don’t want Part B, you put an "X" in the refusal box on the back of the Medicare card form, and send the form to the address shown right below where your signature goes. About four weeks later, you will get a new Medicare card indicating that you only have Part A coverage.3
When can you add or drop forms of Medicare coverage? Medicare has enrollment periods that allow you to do this.
• The initial enrollment period is seven months long. It starts three months before the month in which you turn 65 and ends three months after that month. You can enroll in any type of Medicare coverage within this seven-month window – Part A, Part B, Part C (Medicare Advantage Plan), and Part D (prescription drug coverage). AS it happens, if you don’t sign up for some of this coverage during the initial enrollment period, it may cost you more to add it later.1
• Once you are enrolled in Medicare, you can only make changes in coverage during certain periods of time. For example, the annual enrollment period for Part D is November 15-December 31, with Part D coverage starting January 1. (You can also select a health plan for the next year or drop or change Part D coverage in this period.)4,5
• Additionally, there are also open enrollment periods between January 1 and March 31. These dates frame an open enrollment period for Part D; if you enroll in Part D in this window, coverage starts on the first day of the month after the plan receives your enrollment form. There is also an open enrollment period for Part B coverage from January 1 to March 31; if you sign up for such coverage within that period, it begins in July of that year.1,4
Special situations. Individuals with end-stage kidney failure who need dialysis or a transplant may qualify for Medicare regardless of age. Upon diagnosis, they can contact the SSA. Medicare coverage usually takes effect three months after a patient begins dialysis. People with Lou Gehrig’s Disease (ALS) are automatically enrolled in Medicare as soon as they begin receiving SSDI payments.1
Do you have questions about eligibility, or the eligibility of your parents? Your first stop should be the Social Security Administration (see the contact information in the fourth paragraph above). You can also visit www.medicare.gov and www.cms.hhs.gov.
Jacob Warren
Warren Wealth Management
111 West Port Plaza Drive, Ste 300, Saint Louis, MO 63146
(866) 463- 0752 ext. 52337 toll free, (314) 819-0464
---------------------------------------------------------------------------------
Securities and Investment Advisory Services offered through Woodbury Financial Services, Inc., Member FINRA, SIPC, and Registered Investment Advisor. Warren Wealth Management and Woodbury Financial Services, Inc. are unaffiliated entities.
Content provided by Peter Montoya, Inc. These are the views of Peter Montoya, Inc., not the named representative or Woodbury Financial Services, Inc., and should not be considered investment advice. Neither the representative or Woodbury Financial offer tax or legal advice. All information is believed to be from reliable sources; however, the publisher makes no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting, or other professional services. If expert assistance is needed, the reader is advised to work with a competent professional. Consult your representative for further information.
Citations.
1 nycmccap.org/guide/chap06a1.html [8/16/09]
2 questions.medicare.gov/cgi-bin/medicare.cfg/php/enduser/std_adp.php?p_faqid=2193 [9/1/09]
3 questions.medicare.gov/cgi-bin/medicare.cfg/php/enduser/std_adp.php?p_faqid=2191 [9/1/09]
4 questions.medicare.gov/cgi-bin/medicare.cfg/php/enduser/std_adp.php?p_faqid=2253&p_created=1254843348 [10/6/09]
5 cms.hhs.gov/center/openenrollment.asp [10/1/09]
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The Decade In Review
Tuesday 01/19/2010 - 12:28:16 pm
A look at stocks, commodities and memories (good and bad).
Provided by Jacob Warren
A turbulent ten years. The 2000s gave us remarkable opportunity and remarkable volatility. They tested our patience, and many investment strategies. They taught us to hold on, hang in there and diversify.
Stocks. Was it really a “lost decade”? It depends on how you were invested. Yes, the Dow ended the 1990s at 11,497.12 and ended the 2000s at 10,428.05, amounting to a 9.30% slip. The S&P 500 lost 24.10% in the same interval. If you had invested a lump sum into an index fund tracking the S&P 500 on December 31, 1999 and left those assets untouched for ten years, you would have ended up with a sizable loss.1,2
Well, that sounds dismal - but how many of us actually invest this way? Very few of us make one lump sum investment and just watch it for ten years. Thanks to diversification, rebalancing and constant inflows of new money, quite a few investors were able to grow their assets and/or outperform the S&P 500 in the past decade.
The fact is, five sectors of the S&P 500 gained 10% or more across the 2000s – health care (+10.85%), utilities (+10.92%), materials (+24.91%), consumer staples (+31.84%) and energy (+102.12%).2
Few articles about the “lost decade” mention this notable factoid: the Russell 2000 advanced 23.90% during the 2000s.2 Some investments that focused on buying undervalued small-company stocks gained an average of 8.3% annually in the 2000s.3
Outside America, developing stock markets shattered all expectations while the developed markets mirrored American performance. Look at the decade-long gains in key indices in some of the BRIC nations, as measured by CNBC.com: China, +72%; India, +249%; Brazil, +301%; Russia, +863%. Compare all that with the benchmark indices in Japan (-44%), France (-34%), Great Britain (-22%) and Germany (-14%) in the past decade.4 Emerging markets gained an average of 9.3% per year in the last ten years.3
Commodities. It was a decade of amazing gains in the broad commodities market. From the end of 1999 to the end of 2009, gold advanced 278.52%. How about silver and copper? Silver gained 208.91% and king copper rose 287.78%. Crude oil rose 210.00% during the 2000s.2
How great a decade was it for the commodities sector? Only one notable commodity posted a ten-year loss from 12/31/1999 to 12/31/2009. That was palladium, which retreated 8.98%. On the other hand, we know that 16 commodities gained 100% or more across the decade.2
The two biggest gainers during the 2000s were a pair of crops: sugar (+340.36%) and cocoa (+293.31%).2
Highs and lows. We are 10 years past the bursting of the tech bubble – March 10 will mark the 10th anniversary of the NASDAQ’s all-time high of 5,132.50.5 And of course, a decade-defining geopolitical event rocked the markets 18 months later.
General Motors and Chrysler filed for bankruptcy protection in 2009; at the start of the decade, so did Enron - the company that Fortune Magazine ranked as “most innovative” each year from 1995-2000.6 In 2008, Lehman Brothers, Morgan Stanley, Goldman Sachs, Merrill Lynch, and Washington Mutual either folded, mutated, or were bought up while AIG, Freddie Mac and Fannie Mae were bailed out.
The Dow hit a new high of 11,723 in January 2000, a post-9/11 closing low of 7,286 in October 2002, and then ended 2003 at 10,453 (as the DJIA gained 25.32% that year while the dollar lost 14.67%). The Dow hit new peaks of 11,727 on October 3, 2006 and 14,164 on October 9, 2007. A close of 11,215 on July 2, 2008 officially marked the start of a bear market.7
From March 9, 2009 closing lows to the end of the year, the Dow shot up 59.28% and the S&P 500 advanced 64.83%.2 This led to some to entertain tantalizing thoughts about the birth of a new bull market. Or it is simply a cyclical bull in a secular bear? The jury is still out, as the saying goes; we can hope for the best.
What did we learn? The 2000s taught us lessons about irrational exuberance (companies that had never made a dime were probably not worth billions) and lessons about the value of diversifying your portfolio. We also learned lessons in perseverance – those who stayed invested have seen their portfolios make a strong recovery.
The 2000s put investors through some seemingly unimaginable financial headlines. It was a rare decade, an aberrant one in stock market history – for example, the Dow hadn’t had a negative decade since the 1930s, and it had advanced 228.25% over the 1980s and 317.59% for the 1990s.8 Will we see it make a double- or triple-digit advance in the next ten years? We don’t know. Past performance is no indicator of future success. Yet the awesome potential of the stock market and commodities markets should not be dismissed – and with economies healing the world over, it is clearly time to look forward and stay invested.
Jacob Warren
Warren Wealth Management
111 West Port Plaza Drive, Ste 300, Saint Louis, MO 63146
(866) 463- 0752 ext. 52337 toll free, (314) 819-0464
---------------------------------------------------------------------------------
Securities and Investment Advisory Services offered through Woodbury Financial Services, Inc., Member FINRA, SIPC, and Registered Investment Advisor. Warren Wealth Management and Woodbury Financial Services, Inc. are unaffiliated entities.
Content provided by Peter Montoya, Inc.
These are the views of Peter Montoya, Inc., not the named representative or Woodbury Financial Services, Inc., and should not be considered investment advice. Neither the representative or Woodbury Financial offer tax or legal advice. All information is believed to be from reliable sources; however, the publisher makes no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting, or other professional services. If expert assistance is needed, the reader is advised to work with a competent professional. Consult your representative for further information.
Citations.
1 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=12%2F31%2F99&mode=add&symb=DJIA [1/16/09]
2 cnbc.com/id/34645043 [12/31/09]
3 articles.latimes.com/2009/dec/31/business/la-fi-stocks31-2009dec31?pg=3 [12/31/09]
4 cnbc.com/id/34643111 [12/31/09]
5 smartmoney.com/investing/economy/the-financial-decade-in-review/?page=2 [12/31/09]
6 smartmoney.com/investing/economy/the-financial-decade-in-review/?page=4 [12/31/09]
7 the-privateer.com/chart/dow-long.html [12/31/09]
8 cnbc.com/id/34619797 [12/29/09]
[Permalink]
Provided by Jacob Warren
A turbulent ten years. The 2000s gave us remarkable opportunity and remarkable volatility. They tested our patience, and many investment strategies. They taught us to hold on, hang in there and diversify.
Stocks. Was it really a “lost decade”? It depends on how you were invested. Yes, the Dow ended the 1990s at 11,497.12 and ended the 2000s at 10,428.05, amounting to a 9.30% slip. The S&P 500 lost 24.10% in the same interval. If you had invested a lump sum into an index fund tracking the S&P 500 on December 31, 1999 and left those assets untouched for ten years, you would have ended up with a sizable loss.1,2
Well, that sounds dismal - but how many of us actually invest this way? Very few of us make one lump sum investment and just watch it for ten years. Thanks to diversification, rebalancing and constant inflows of new money, quite a few investors were able to grow their assets and/or outperform the S&P 500 in the past decade.
The fact is, five sectors of the S&P 500 gained 10% or more across the 2000s – health care (+10.85%), utilities (+10.92%), materials (+24.91%), consumer staples (+31.84%) and energy (+102.12%).2
Few articles about the “lost decade” mention this notable factoid: the Russell 2000 advanced 23.90% during the 2000s.2 Some investments that focused on buying undervalued small-company stocks gained an average of 8.3% annually in the 2000s.3
Outside America, developing stock markets shattered all expectations while the developed markets mirrored American performance. Look at the decade-long gains in key indices in some of the BRIC nations, as measured by CNBC.com: China, +72%; India, +249%; Brazil, +301%; Russia, +863%. Compare all that with the benchmark indices in Japan (-44%), France (-34%), Great Britain (-22%) and Germany (-14%) in the past decade.4 Emerging markets gained an average of 9.3% per year in the last ten years.3
Commodities. It was a decade of amazing gains in the broad commodities market. From the end of 1999 to the end of 2009, gold advanced 278.52%. How about silver and copper? Silver gained 208.91% and king copper rose 287.78%. Crude oil rose 210.00% during the 2000s.2
How great a decade was it for the commodities sector? Only one notable commodity posted a ten-year loss from 12/31/1999 to 12/31/2009. That was palladium, which retreated 8.98%. On the other hand, we know that 16 commodities gained 100% or more across the decade.2
The two biggest gainers during the 2000s were a pair of crops: sugar (+340.36%) and cocoa (+293.31%).2
Highs and lows. We are 10 years past the bursting of the tech bubble – March 10 will mark the 10th anniversary of the NASDAQ’s all-time high of 5,132.50.5 And of course, a decade-defining geopolitical event rocked the markets 18 months later.
General Motors and Chrysler filed for bankruptcy protection in 2009; at the start of the decade, so did Enron - the company that Fortune Magazine ranked as “most innovative” each year from 1995-2000.6 In 2008, Lehman Brothers, Morgan Stanley, Goldman Sachs, Merrill Lynch, and Washington Mutual either folded, mutated, or were bought up while AIG, Freddie Mac and Fannie Mae were bailed out.
The Dow hit a new high of 11,723 in January 2000, a post-9/11 closing low of 7,286 in October 2002, and then ended 2003 at 10,453 (as the DJIA gained 25.32% that year while the dollar lost 14.67%). The Dow hit new peaks of 11,727 on October 3, 2006 and 14,164 on October 9, 2007. A close of 11,215 on July 2, 2008 officially marked the start of a bear market.7
From March 9, 2009 closing lows to the end of the year, the Dow shot up 59.28% and the S&P 500 advanced 64.83%.2 This led to some to entertain tantalizing thoughts about the birth of a new bull market. Or it is simply a cyclical bull in a secular bear? The jury is still out, as the saying goes; we can hope for the best.
What did we learn? The 2000s taught us lessons about irrational exuberance (companies that had never made a dime were probably not worth billions) and lessons about the value of diversifying your portfolio. We also learned lessons in perseverance – those who stayed invested have seen their portfolios make a strong recovery.
The 2000s put investors through some seemingly unimaginable financial headlines. It was a rare decade, an aberrant one in stock market history – for example, the Dow hadn’t had a negative decade since the 1930s, and it had advanced 228.25% over the 1980s and 317.59% for the 1990s.8 Will we see it make a double- or triple-digit advance in the next ten years? We don’t know. Past performance is no indicator of future success. Yet the awesome potential of the stock market and commodities markets should not be dismissed – and with economies healing the world over, it is clearly time to look forward and stay invested.
Jacob Warren
Warren Wealth Management
111 West Port Plaza Drive, Ste 300, Saint Louis, MO 63146
(866) 463- 0752 ext. 52337 toll free, (314) 819-0464
---------------------------------------------------------------------------------
Securities and Investment Advisory Services offered through Woodbury Financial Services, Inc., Member FINRA, SIPC, and Registered Investment Advisor. Warren Wealth Management and Woodbury Financial Services, Inc. are unaffiliated entities.
Content provided by Peter Montoya, Inc.
These are the views of Peter Montoya, Inc., not the named representative or Woodbury Financial Services, Inc., and should not be considered investment advice. Neither the representative or Woodbury Financial offer tax or legal advice. All information is believed to be from reliable sources; however, the publisher makes no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting, or other professional services. If expert assistance is needed, the reader is advised to work with a competent professional. Consult your representative for further information.
Citations.
1 money.cnn.com/quote/historical/historical.html?pg=hi&close_date=12%2F31%2F99&mode=add&symb=DJIA [1/16/09]
2 cnbc.com/id/34645043 [12/31/09]
3 articles.latimes.com/2009/dec/31/business/la-fi-stocks31-2009dec31?pg=3 [12/31/09]
4 cnbc.com/id/34643111 [12/31/09]
5 smartmoney.com/investing/economy/the-financial-decade-in-review/?page=2 [12/31/09]
6 smartmoney.com/investing/economy/the-financial-decade-in-review/?page=4 [12/31/09]
7 the-privateer.com/chart/dow-long.html [12/31/09]
8 cnbc.com/id/34619797 [12/29/09]
[Permalink]
A Look At Mortgage Term Life Insurance
Tuesday 01/12/2010 - 1:37:34 pm
What are the pros and cons of paying premiums for mortgage protection?
provided by Jacob Warren
A potential “helping hand” for a homeowner’s heirs. No one wants to saddle their heirs with the hard choice of paying off an unsettled mortgage or selling or losing a home. A mortgage term life insurance policy can provide relief in such a dilemma.
Simply put, this is a term life policy designed for homeowners. If you die owing a huge sum to a mortgage lender, the proceeds from the policy will pay off the note.
Why, and why not? The pros and cons of mortgage term life are simply stated. On the plus side, you are paying (relatively) little for a lot of potential mortgage protection, which could be useful if your heirs are in no financial shape to make mortgage payments. On the negative side, term insurance is term insurance. If you live past the term of your mortgage term life policy, no benefit will be forthcoming for all those premiums.
You don’t find many fans of mortgage term life insurance in the mortgage industry. Their argument is that a regular life insurance policy might do the job just as well, and give your heirs more flexibility besides. Still, quite a few homeowners want mortgage term life insurance and appreciate its designated purpose.
Basic types. The cheapest type of mortgage term life is the level premium/level benefit policy. You can commonly purchase them with 20-, 25- or 30-year terms. As the name implies, the premiums are guaranteed to stay level for the entire policy term, and the benefit amount does not decline with time.
You can still find the original kind of mortgage term life policy, in which your premiums stay level but your coverage shrinks as your mortgage balance diminishes. While some banks and insurers still offer these “old school” policies, they are getting scarce.
An interesting alternative. Some homeowners decide to get a return-of-premium term life policy instead of a mortgage term life policy. With an ROP term policy, the insurance company will give you all of your premiums back if you outlive the term (provided, of course, that you’ve kept your policy in force). Someone with 20 years left on a home loan could get a 20-year ROP term policy for an amount comparable to their mortgage balance and get all the money paid into the policy back without a tax consequence if they are alive two decades later.1 That money could be used for any need or objective.
So how is this different than private mortgage insurance? Well, PMI isn’t about protecting you at all – it’s about protecting the lender in case you default on your home loan. It diversifies that risk to a third party.
Should you look into these options? You might be in a situation in which you really don’t want to risk burdening your heirs with an existing mortgage – especially if they are trying to pay off one themselves. Or, maybe you want a more flexible insurance option that could be used to pay off a mortgage or meet other needs. Talk to your financial or insurance advisor today to explore this a little further.
Jacob Warren
Warren Wealth Management
111 West Port Plaza Drive, Ste 300, Saint Louis, MO 63146
(866) 463- 0752 ext. 52337 toll free, (314) 819-0464
---------------------------------------------------------------------------------
Securities and Investment Advisory Services offered through Woodbury Financial Services, Inc., Member FINRA, SIPC, and Registered Investment Advisor. Warren Wealth Management and Woodbury Financial Services, Inc. are unaffiliated entities.
Content provided by Peter Montoya, Inc.
These are the views of Peter Montoya Inc., not the named Representative nor Broker/Dealer, and should not be construed as investment advice. Neither the named Representative nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information.
Citations.
1 usnews.com/usnews/biztech/articles/041025/25insurance.htm [10/17/04]
[Permalink]
provided by Jacob Warren
A potential “helping hand” for a homeowner’s heirs. No one wants to saddle their heirs with the hard choice of paying off an unsettled mortgage or selling or losing a home. A mortgage term life insurance policy can provide relief in such a dilemma.
Simply put, this is a term life policy designed for homeowners. If you die owing a huge sum to a mortgage lender, the proceeds from the policy will pay off the note.
Why, and why not? The pros and cons of mortgage term life are simply stated. On the plus side, you are paying (relatively) little for a lot of potential mortgage protection, which could be useful if your heirs are in no financial shape to make mortgage payments. On the negative side, term insurance is term insurance. If you live past the term of your mortgage term life policy, no benefit will be forthcoming for all those premiums.
You don’t find many fans of mortgage term life insurance in the mortgage industry. Their argument is that a regular life insurance policy might do the job just as well, and give your heirs more flexibility besides. Still, quite a few homeowners want mortgage term life insurance and appreciate its designated purpose.
Basic types. The cheapest type of mortgage term life is the level premium/level benefit policy. You can commonly purchase them with 20-, 25- or 30-year terms. As the name implies, the premiums are guaranteed to stay level for the entire policy term, and the benefit amount does not decline with time.
You can still find the original kind of mortgage term life policy, in which your premiums stay level but your coverage shrinks as your mortgage balance diminishes. While some banks and insurers still offer these “old school” policies, they are getting scarce.
An interesting alternative. Some homeowners decide to get a return-of-premium term life policy instead of a mortgage term life policy. With an ROP term policy, the insurance company will give you all of your premiums back if you outlive the term (provided, of course, that you’ve kept your policy in force). Someone with 20 years left on a home loan could get a 20-year ROP term policy for an amount comparable to their mortgage balance and get all the money paid into the policy back without a tax consequence if they are alive two decades later.1 That money could be used for any need or objective.
So how is this different than private mortgage insurance? Well, PMI isn’t about protecting you at all – it’s about protecting the lender in case you default on your home loan. It diversifies that risk to a third party.
Should you look into these options? You might be in a situation in which you really don’t want to risk burdening your heirs with an existing mortgage – especially if they are trying to pay off one themselves. Or, maybe you want a more flexible insurance option that could be used to pay off a mortgage or meet other needs. Talk to your financial or insurance advisor today to explore this a little further.
Jacob Warren
Warren Wealth Management
111 West Port Plaza Drive, Ste 300, Saint Louis, MO 63146
(866) 463- 0752 ext. 52337 toll free, (314) 819-0464
---------------------------------------------------------------------------------
Securities and Investment Advisory Services offered through Woodbury Financial Services, Inc., Member FINRA, SIPC, and Registered Investment Advisor. Warren Wealth Management and Woodbury Financial Services, Inc. are unaffiliated entities.
Content provided by Peter Montoya, Inc.
These are the views of Peter Montoya Inc., not the named Representative nor Broker/Dealer, and should not be construed as investment advice. Neither the named Representative nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information.
Citations.
1 usnews.com/usnews/biztech/articles/041025/25insurance.htm [10/17/04]
[Permalink]
Why Choose A Credit Union?
Monday 01/04/2010 - 11:20:23 am
What do they have going for them that banks don’t?
Presented by Jacob Warren
Why do people choose a credit union over a bank? It isn’t just a matter of one’s profession or union encouraging the choice – though that certainly plays a role. People like credit unions for other compelling reasons.
A fundamental (and philosophical) difference. Credit unions are not-for-profit organizations owned by their members; retail and business banks are for-profit private enterprises. A bank seeks to maximize earnings as it serves its customers. The more income it can derive from you, the better for its future. Banks have to answer to shareholders. Credit unions must ultimately answer to members.
Credit unions commonly use profits to fund reserves. Excess earnings may be indirectly returned to members – they can translate into reduced loan rates, higher interest rates on savings accounts (which are called share accounts), and lower fees. Some CUs have even sent members bonus checks.
A chance to potentially save money over time. Money which banks might charge you, that is. Checking accounts are free at most credit unions. In most cases, a checking account at a CU requires no minimum balance, and there are no per-check fees or overdraft fees. Historically, most credit unions haven’t returned cancelled checks to their members – mostly because of the expense. However, many CUs provide them at request.
What about ATMs? Well, there are more than you might think. Many credit unions belong to the CO-OP Network, a credit-union only ATM network with more than 28,000 ATMs in America. Credit Union 24, a member-owned, full-service ATM cooperative, helps CUs offer their members more than 100,000 ATMs and more than 50,000 surcharge-free ATMs.1,2
If you need to get a loan to buy a car or some other major item, the person on the other side of the desk may quickly ask you if you belong to a credit union. There’s a reason for that: loan rates at CUs are often better than those at banks.
Are your assets federally insured at a credit union? Yes, in almost all cases. Just as almost all banks are FDIC-insured, about 98% of credit unions are federally insured through the National Credit Union Share Insurance Fund, administered by the National Credit Union Administration (NCUA). No member of a federally insured credit union has lost a cent of their insured credit union savings in the NCUA’s history.3
A share account at a federally insured credit union is insured up to $250,000 through the end of 2013 as a result of the Emergency Economic Stabilization Act of 2008, the same level of insurance that the FDIC affords bank accounts.3
Credit unions may not be as numerous as banks, but these are some of the reasons why their members prefer them. If you have eligibility to join a credit union, it is worth seeing what that credit union can do for you and comparing the potential long-term savings of a credit union relationship against a bank relationship.
Jacob Warren
Warren Wealth Management
111 West Port Plaza Drive, Ste 300, Saint Louis, MO 63146
(866) 463- 0752 ext. 52337 toll free, (314) 819-0464
--------------------------------------------------------------------------------
Securities and Investment Advisory Services offered through Woodbury Financial Services, Inc., Member FINRA, SIPC, and Registered Investment Advisor. Warren Wealth Management and Woodbury Financial Services, Inc. are unaffiliated entities.
Content provided by Peter Montoya, Inc.
These are the views of Peter Montoya Inc., not the named Representative nor Broker/Dealer, and should not be construed as investment advice. Neither the named Representative nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Professional for further information.
[Permalink]
Presented by Jacob Warren
Why do people choose a credit union over a bank? It isn’t just a matter of one’s profession or union encouraging the choice – though that certainly plays a role. People like credit unions for other compelling reasons.
A fundamental (and philosophical) difference. Credit unions are not-for-profit organizations owned by their members; retail and business banks are for-profit private enterprises. A bank seeks to maximize earnings as it serves its customers. The more income it can derive from you, the better for its future. Banks have to answer to shareholders. Credit unions must ultimately answer to members.
Credit unions commonly use profits to fund reserves. Excess earnings may be indirectly returned to members – they can translate into reduced loan rates, higher interest rates on savings accounts (which are called share accounts), and lower fees. Some CUs have even sent members bonus checks.
A chance to potentially save money over time. Money which banks might charge you, that is. Checking accounts are free at most credit unions. In most cases, a checking account at a CU requires no minimum balance, and there are no per-check fees or overdraft fees. Historically, most credit unions haven’t returned cancelled checks to their members – mostly because of the expense. However, many CUs provide them at request.
What about ATMs? Well, there are more than you might think. Many credit unions belong to the CO-OP Network, a credit-union only ATM network with more than 28,000 ATMs in America. Credit Union 24, a member-owned, full-service ATM cooperative, helps CUs offer their members more than 100,000 ATMs and more than 50,000 surcharge-free ATMs.1,2
If you need to get a loan to buy a car or some other major item, the person on the other side of the desk may quickly ask you if you belong to a credit union. There’s a reason for that: loan rates at CUs are often better than those at banks.
Are your assets federally insured at a credit union? Yes, in almost all cases. Just as almost all banks are FDIC-insured, about 98% of credit unions are federally insured through the National Credit Union Share Insurance Fund, administered by the National Credit Union Administration (NCUA). No member of a federally insured credit union has lost a cent of their insured credit union savings in the NCUA’s history.3
A share account at a federally insured credit union is insured up to $250,000 through the end of 2013 as a result of the Emergency Economic Stabilization Act of 2008, the same level of insurance that the FDIC affords bank accounts.3
Credit unions may not be as numerous as banks, but these are some of the reasons why their members prefer them. If you have eligibility to join a credit union, it is worth seeing what that credit union can do for you and comparing the potential long-term savings of a credit union relationship against a bank relationship.
Jacob Warren
Warren Wealth Management
111 West Port Plaza Drive, Ste 300, Saint Louis, MO 63146
(866) 463- 0752 ext. 52337 toll free, (314) 819-0464
--------------------------------------------------------------------------------
Securities and Investment Advisory Services offered through Woodbury Financial Services, Inc., Member FINRA, SIPC, and Registered Investment Advisor. Warren Wealth Management and Woodbury Financial Services, Inc. are unaffiliated entities.
Content provided by Peter Montoya, Inc.
These are the views of Peter Montoya Inc., not the named Representative nor Broker/Dealer, and should not be construed as investment advice. Neither the named Representative nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Professional for further information.
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Some Financial New Year's Resolutions
Monday 01/04/2010 - 11:15:27 am
Things you might want to consider doing in 2010.
Presented by Jacob Warren
Okay. It’s that time of year - the time for new year’s resolutions. They can include financial resolutions. Here are some possibilities for 2010.
Control non-mortgage debt. Experian says the average American carries about $17,000 in debt unrelated to home loans. Too much of this is simply credit card debt. So how about paying down, paying off and maybe getting rid of some cards?1
How much financial ground can you lose to plastic? Well, if you have a credit card with a $17,000 balance and 10% APR and you pay $200 monthly on it, it will take you 12 years to pay it off.1
You may have so-called “good debts” as a consequence of your business or your professional career. Yet ultimately, debt is debt. You can certainly plan to build wealth and control debt at the same time, and why not plan to do both?
Play catch-up if you’re older than 50. All of us over 50 have the chance to make a catch-up contribution to our IRAs and 401(k)s. If you have a 401(k), you can defer up to $22,000 of your 2010 salary into it if you’re over 50 (an extra $5,500 above the usual limit). You also have the chance to contribute an extra $1,000 to your IRA (or among multiple IRAs if you have more than one). And if you’ve got an IRA, there’s no point in waiting until April 15, 2011 to make your 2010 contribution – if you wait that long, you’ll potentially lose 15 months of interest.2
Look into the possibility of a Roth IRA conversion. 2010 presents investors with a prime opportunity to convert traditional IRAs into Roths. The IRS has removed the income limitations on Roth conversions this year, and it will let you spread the taxes due on a 2010 Roth conversion across 2011 and 2012. However, you should definitely talk to a tax professional before you make this move. As income tax rates could be raised for 2011 or 2012, you may want to take the tax hit on a Roth conversion in 2010 instead.3
Keep important documents where you can access them. Tax returns, wills, trust documents, deeds, insurance policies – you don’t want to have to hunt for this stuff, and neither should your heirs in a crisis. You may not want to keep these documents out in the open, but you should know where they are. Resolve to put them all together in a central place in 2010. Another option: you may want to store copies online. Some financial professionals offer their clients firewall-protected, password-only “web vaults” for this purpose, so you can take a look at these items away from home if needed.
Understand how your portfolio assets are allocated. A new FINRA survey finds that 79% of Americans regularly contribute to retirement savings plans. That’s the good news. The bad news? About a fifth of those people had no idea how those assets were invested.4
When stocks do well, it is easy to become less vigilant about your investments. It is also easy for your portfolio to get out of whack and become overweighted in this or that asset class. So the first part of 2010 is a very good time to check in with your financial professional. After all the volatility in the market the last couple of years, it is prudent to review your investments and see if your portfolio needs rebalancing to bring it back in line with your risk tolerance and investment horizon.
More people abide by financial resolutions than you might think. In late 2009, Fidelity surveyed a group of about 1,000 Americans and found that 60% of them had kept financial resolutions they made at the start of the year.5 So it can be done. Resolve to change your financial habits for the better – and follow through on it.
Jacob Warren
Warren Wealth Management
111 West Port Plaza Drive, Ste 300, Saint Louis, MO 63146
(866) 463- 0752 ext. 52337 toll free, (314) 819-0464
---------------------------------------------------------------------------------
Securities and Investment Advisory Services offered through Woodbury Financial Services, Inc., Member FINRA, SIPC, and Registered Investment Advisor. Warren Wealth Management and Woodbury Financial Services, Inc. are unaffiliated entities.
Content provided by Peter Montoya, Inc.
These are the views of Peter Montoya Inc., not the named Representative nor Broker/Dealer, and should not be construed as investment advice. Neither the named Representative nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information.
Citations.
1 walletpop.com/blog/2009/12/28/put-the-solution-in-resolution-10-steps-to-financial-sanity-i/ [12/28/09]
2 washingtonpost.com/wp-dyn/content/article/2009/12/18/AR2009121804699.html [12/18/09]
3 latimes.com/business/la-fi-roth-iras1-2010jan01,0,3862158,full.column [1/1/10]
4 foxbusiness.com/story/markets/americans-nearly-flunk-financial-literacy-test/ [12/28/09]
5 blogs.consumerreports.org/money/2009/12/financial-2010-new-years-resolutions-surveys-save-money-spend-less-stick-to-budget-fidelity-investme.html [12/31/09]
[Permalink]
Presented by Jacob Warren
Okay. It’s that time of year - the time for new year’s resolutions. They can include financial resolutions. Here are some possibilities for 2010.
Control non-mortgage debt. Experian says the average American carries about $17,000 in debt unrelated to home loans. Too much of this is simply credit card debt. So how about paying down, paying off and maybe getting rid of some cards?1
How much financial ground can you lose to plastic? Well, if you have a credit card with a $17,000 balance and 10% APR and you pay $200 monthly on it, it will take you 12 years to pay it off.1
You may have so-called “good debts” as a consequence of your business or your professional career. Yet ultimately, debt is debt. You can certainly plan to build wealth and control debt at the same time, and why not plan to do both?
Play catch-up if you’re older than 50. All of us over 50 have the chance to make a catch-up contribution to our IRAs and 401(k)s. If you have a 401(k), you can defer up to $22,000 of your 2010 salary into it if you’re over 50 (an extra $5,500 above the usual limit). You also have the chance to contribute an extra $1,000 to your IRA (or among multiple IRAs if you have more than one). And if you’ve got an IRA, there’s no point in waiting until April 15, 2011 to make your 2010 contribution – if you wait that long, you’ll potentially lose 15 months of interest.2
Look into the possibility of a Roth IRA conversion. 2010 presents investors with a prime opportunity to convert traditional IRAs into Roths. The IRS has removed the income limitations on Roth conversions this year, and it will let you spread the taxes due on a 2010 Roth conversion across 2011 and 2012. However, you should definitely talk to a tax professional before you make this move. As income tax rates could be raised for 2011 or 2012, you may want to take the tax hit on a Roth conversion in 2010 instead.3
Keep important documents where you can access them. Tax returns, wills, trust documents, deeds, insurance policies – you don’t want to have to hunt for this stuff, and neither should your heirs in a crisis. You may not want to keep these documents out in the open, but you should know where they are. Resolve to put them all together in a central place in 2010. Another option: you may want to store copies online. Some financial professionals offer their clients firewall-protected, password-only “web vaults” for this purpose, so you can take a look at these items away from home if needed.
Understand how your portfolio assets are allocated. A new FINRA survey finds that 79% of Americans regularly contribute to retirement savings plans. That’s the good news. The bad news? About a fifth of those people had no idea how those assets were invested.4
When stocks do well, it is easy to become less vigilant about your investments. It is also easy for your portfolio to get out of whack and become overweighted in this or that asset class. So the first part of 2010 is a very good time to check in with your financial professional. After all the volatility in the market the last couple of years, it is prudent to review your investments and see if your portfolio needs rebalancing to bring it back in line with your risk tolerance and investment horizon.
More people abide by financial resolutions than you might think. In late 2009, Fidelity surveyed a group of about 1,000 Americans and found that 60% of them had kept financial resolutions they made at the start of the year.5 So it can be done. Resolve to change your financial habits for the better – and follow through on it.
Jacob Warren
Warren Wealth Management
111 West Port Plaza Drive, Ste 300, Saint Louis, MO 63146
(866) 463- 0752 ext. 52337 toll free, (314) 819-0464
---------------------------------------------------------------------------------
Securities and Investment Advisory Services offered through Woodbury Financial Services, Inc., Member FINRA, SIPC, and Registered Investment Advisor. Warren Wealth Management and Woodbury Financial Services, Inc. are unaffiliated entities.
Content provided by Peter Montoya, Inc.
These are the views of Peter Montoya Inc., not the named Representative nor Broker/Dealer, and should not be construed as investment advice. Neither the named Representative nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information.
Citations.
1 walletpop.com/blog/2009/12/28/put-the-solution-in-resolution-10-steps-to-financial-sanity-i/ [12/28/09]
2 washingtonpost.com/wp-dyn/content/article/2009/12/18/AR2009121804699.html [12/18/09]
3 latimes.com/business/la-fi-roth-iras1-2010jan01,0,3862158,full.column [1/1/10]
4 foxbusiness.com/story/markets/americans-nearly-flunk-financial-literacy-test/ [12/28/09]
5 blogs.consumerreports.org/money/2009/12/financial-2010-new-years-resolutions-surveys-save-money-spend-less-stick-to-budget-fidelity-investme.html [12/31/09]
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