Friday, July 15, 2016

Are you using your Tax-FREE account?

Are you using the tax code to your benefit? The rich pay only 17% total while we pay 33% total. Use your IRS-approved tax shelter account to avoid the taxes they owe. In retirement, you must take RMD from your qualified accounts because you didn’t pay upfront. However, you may be missing an opportunity to save on taxes. Let’s say your only income is SS and an IRA and pension. Your SS benefit is taxed based on the level of your other income. Couples over 65 can have taxable income of about $24,000 and pay no tax (SD+PE). If your SS, RMD and other taxable income is $12,000, you could pull out another $12,000 from your IRA with no additional tax. Converting that additional $12,000 with no tax to a Roth IRA now allows your $12,000 (not taxed) to grow to $24,000 (in 8 years) and never be taxed. Plus, if you do this every year, your future RMDs will be lower, allowing more conversions at ZERO tax forever.

We can have democracy in this country, or we can have great wealth concentrated in the hands of a few, but we can't have both.   Louis Brandeis, Supreme Court justice (1916-1938)

Are you overpaying for your managed account
Some managed account firms are using a lower fee schedule to attract your money. Some are charging 50 basis points (0.50%) to manage your portfolio and just 0.25% to house it. Then when it reaches a good size, say $400,000, you pay only $1,500 or $1,000 tops. This compares to the standard 1% for management plus 1.5% of funds. Some firms use index and active funds in the portfolios so that you cover the full range of risk-adjusted performance. These firms are pricing for a discount of 1.5% compared to the industry standard. Vanguard’s low-cost leader status is pushing this trend to lower fees.
Forget the middlemen. Get the best for less: https://www.amazon.com/Vanguards-Top-Ten-mutual-funds/dp/150073909X
  
Is your 401k robbing you of a FULL nest egg?
Are your fees too high? New lawsuits show that Lockheed’s $62 million settlement was the rule not the exception. You may have lost $ thousands since the plan took their fees off the top and you never saw them. When your employer installs a plan, it picks the seller and investment options, not you. You would pick Vanguard, with the lowest fees. Fujitsu, for example, picked target-date funds created by a Shepherd Kaplan who charged the retail rate of over 1% not 0.15% for new funds which underperformed their benchmarks. Employees paid about $3 million in excess record-keeping fees in 2011 alone. Employees were forced to subsidize their employer in a ‘revenue sharing’ plan.


Why Wall Street professionals can’t beat the market
Trent wrote a great explanation of what money managers actually do to be top dogs.
Managers are really marketing firms. They would rather be rich than be smart. Consider: you can pick thousands of managers of mutual funds. How can they justify people giving them money? They must do some tricks with stats to make it look like they lead the pack so we will give them money. They must spend money to advertise. They must go to conferences and TV shows to talk themselves up. They must do a lot of data mining to find that exact time when their funds did well. If they are lucky they will have some story to sell about their funds or themselves. Their fees lower your returns over time.

You can avoid increases in state taxes too
In the future, many states will have to increase taxes to cover huge pension obligations and collapsing infrastructure and state scandals. For instance, NJ’s Christie costs tax payers $10 million related to the Bridgegate scandal so far. He has missed promised pension funding and road rebuilding funding. Christie gave millionaires a break on taxes so they wouldn’t leave but they did. KS cut taxes on business and the economy tanked. No one wants to move a business there if the schools and infrastructure are poor. KS took federal money for child support it must return. KS has slashed funding for higher education too. IL has lost millions of dollars in investment income because of the budget stalemate. Emergency funding for universities, domestic violence shelters and food stamps will run out soon. Primary and secondary schools may have a delayed opening. GOP-run states are unlikely to reinstate taxes on their millionaire supporters.  

Auto claims can bump your insurance premium. How much?
I have a claim—my bumper got dented when I backed too far. Should I file a claim or pay myself. I have comprehensive. How much will my premium rise? I have $1,000 deductible and have saved $100 a year for 10 years. New site gives you the probable extra premium you will pay: http://www.insurancequotes.com/auto/auto-insurance-claim-rate-increase-022216 I was happy carrying a higher deductible since I got a great rate years ago. Site says my increase would be small but if I am in an accident in the next year my next claim puts me at jeopardy of higher premium. 2 in 2 years is not good.

Are NextShares right for you or just marketing trick?
NextShares are a mash-up of a typical mutual fund - with a manager buying and selling stocks or bonds in hopes of beating the market - and an exchange-traded fund built to shave trading costs and taxes. Traders can buy NextShares throughout the day, like ETFs, but they price after the market closes, like mutual funds. But unlike ETF that try to beat the market, NextShares only reports holdings quarterly. ETFs report holdings daily and thus are copied. So you are buying a promise; not visible securities. The industry thinks they will replace mutual funds because their structure makes them “big money-savers.” However, you are paying the trading costs and the underlying fees which have not been disclosed yet. It will be very hard for investors to beat the low-cost leader of funds at 0.05%. Plus the new funds have no history. The industry is desperate for new money.

Is your medical insurer being fair?
Your medical insurance provider may be overcharging you for tests and procedures. If you have insurance with a high deductible, you may be better off paying cash for the test.  https://www.healthcarebluebook.com/page_ProcedureDetails.aspx?id=379&dataset=lab&g=Blood+Glucose+(Sugar)+Level says this diabetes test costs $11. My insurer’s lab (LabCorp) has me sign a form making me liable for $577 if my insurer does not pay them. If my deductible is $2,000, I am way ahead paying cash with no insurance card. Does my insurer pay $11 or $150 for the test? It is great how we get stuck from both sides. We pay the premiums but we can’t get them to charge us the cash price. We are subsidizing the CEO’s $14 million pay package without the benefits. When I am sick, the last thing I should have to do is dicker about price but this is our “best in world” system.




            I can’t release tax returns since I pay the “lowest rate possible.” he pays minus%!
            I don’t encourage violence, just more guns and intolerance of non-whites. Riots?
            Pro choice DEM for VP should help some delegates decide to quit. GOP Platform
            After 4,000 lawsuits by and against Don--he rarely follows through. Scary!
            57% embarrassed to work a firm that paid for Don’s coronation.
            A Supreme says calling Don a faker was ill-advised. He will swamp her as Pres.

            DEMs platform is a progressive statement—Do Nothing Congress will sit on it.
            DEMs revive togetherness for Hill’s coronation.
            Clinton’s Whitewater investigation lasted 8 years, 3,000 subpoenas, 10 million             pages—cost more than $70 million. Emails $30 million—she is running for Pres.

Rick Perry: Mexican wall will be a “digital” “technological” barrier, not physical one


Regulators are the only protection we have since we can’t sue anymore
            “It is nearly impossible for one individual to take on a corporation with vast resources.” (GOP bill requires impossible: every person in class action suffer “same type and scope of injury”)
               Supremes stop us from suing—State courts no longer available to sue corporations!

.Harley caught brakes may fail—recall?
.Chetan Kapur, ThinkStrategy Capital, caught hiding $ millions with Swiss he stole.
.Fiat pays hackers so it understands how they crash Jeeps remotely.
.FBI goes to activists’ homes—“Don’t go to Cleveland” for protests. ACLU?
.Santander Bank fined for illegal overdraft service practices—deceptive marketing
.Porsche recalls all the 918 Spyders for seat belt mount
.You can't bring a water gun to GOP Convention, but you can bring an AK-47.

.When everyone has guns; your chance of being killed goes up. Just by the numbers. 

We need regulation—GOP wrong—companies/cities wouldn’t fix bad products on own


SCAMS
KY Ark is brainwashing kids? or voters who gave $18 million in tax subsidy? Only 6,000
Bahamas tells its young visitors to US: use “extreme caution” with police?
GM can’t avoid death claims for killing 124 people by hiding in liability bankruptcy.


Pope Francis appointed former Fox News Burke to serve as his chief spokesman?!?

How our government wastes our money
More troops to Iraq and more troops to Afghan. We are building missile base in S Korea.
GOP “demands” that Obama ask for money! --setting up a bitter political fight? Deals?
Obama’s government posted a budget surplus of $6 billion in June? GOP $12 Trillion.
US investigation of Clinton cost more than $70 million Whitewater. Benghazi $6.8 million and Email’s cost $30 million. No indictment and she might become Pres.
Christie costs tax payers $10 million related to the Bridgegate scandal so far. 
Zika will cost more AFTER infections than prevention now -- Kids will need life care!

Who owns your account now?


IAN
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