Your Unbiased Advisor: Which is better for you--ETF or mutual fund?

Which is better for you—ETF or mutual fund?

As usual it depends. It depends on what you are trying to do with your money. ETFs are index funds that can be traded daily for a price. You have to have a brokerage account. You should know why you are buying this particular one—not just because your broker is selling it. The industry created these securities because investors were moving money to index funds because they beat stock pickers over time. They created ETFs so they could get investors to trade again. Now, the pitch is this ‘slice of the market will beat your cheap index fund.’ They have not. Studies show “In every single time period and data point tested, low-cost funds beat high-cost funds” and cost is the most accurate predictor of success. Over time, paying 2% of your money may seem trivial but can take 63% of your potential accumulation.

Trader or Investor: https://www.amazon.com/Wealth-Without-Wall-Street-Commissions/dp/1442168137

What if you did NOT file a tax return on time?

Anyone who didn’t file and owes tax should file a return as soon as possible and pay as much as possible to reduce penalties and interest. There’s no penalty for filing a late return if a refund is due. Penalties and interest only accrue on unfiled returns of taxpayers who don’t pay by the deadline. IRS Free File is still available on IRS.gov through October 15 to prepare and file returns electronically if you qualify. If you usually pay on time you may qualify for penalty relief. Otherwise, apply online for a payment plan—an installment agreement. IRS fixes your math errors and notifies you by mail—calls from IRS are scammers. Letters may also request missing forms or schedules.

Amendment to fix: https://www.irs.gov/newsroom/tips-for-taxpayers-who-have-to-amend-a-tax-return

You can earn HIGHER returns than the Harvard Endowment

A small college in WI uses a former businessman as advisor. Working from his home, his picks surpassed the dozens of advisor portfolio managers at Harvard and many other Ivy schools. The winning advisor’s approach is more pedestrian: mostly low-cost, market-tracking index funds from Vanguard, the same funds used by legions of do-it-yourself individual investors. Why isn’t reliance on indexing more common among those who oversee the nation’s half a trillion dollars in college endowments? “Maybe it’s too simple,” advisor Abt says. That is also what Warren Buffett says. How could Ivy school advisors justify $175 millions in salary and bonus if they used low-cost index funds?

Anybody can do that: https://www.amazon.com/MasterClass-Buffetts-SIMPLE-Strategy/dp/1983485268

Do you know all the lingo and fees when you shop for a car/vehicle?
Time to review what the sales person means and charges are BEFORE you hit the internet to search for your best deal. This glossary helps you learn what fees you can negotiate and which your state requires. Do you pay the average price for your model and mileage (used) and dealer or private owner? Obtain your own financing if you can since dealers make more on the financing (for those with poor credit) than on the car. Just don’t tell the seller until you agree on the price. Remember, you are going through all this because a car/vehicle can cost as much as your house down payment. Over 6-8 years of the loan you may be overpaying by $9,600 or more. Same with insurance. Cutting out the add-ons and using a high deductible will save you $500 to $1000 per year.

Ask for all 12 discounts: https://www.amazon.com/Vehicle-Insurance-Beware-Double-Coverage/dp/1480027634

Why is a Target Retirement fund perfect for your graduate?

Easy to start and add money every year. There is no fear of buying the wrong securities. You can make contributions automatically. Over time this fund will earn more because the cost is very low—0.15%. If your grad earns money, even part-time, you can match it in an account that creates a nest egg that is completely tax-FREE. Even if they have to use some of it along the way, they won’t pay tax on the contributions. Even if the market does not grow every year, they have a good chance of amassing $500,000 over 30 years. Your money earns the stock market average of 10-12%. This account avoids all the contingencies of an employer’s 401k like high fees, poor performance, bankruptcy, or tracking abandoned plans--and solves the annual ‘pick a present’ problem.

Make your gift Tax-Free forever: https://www.amazon.com/Tax-Shelter-Young-Americans/dp/1500426520

Is your advisor raising your fees and costs?

A growing number of investment advisors are successfully increasing client fees from 10 to 25 basis points, industry insiders say. “We have seen many clients increase their fees, in contrast to racing to be the lowest-cost wealth manager,” said Carolyn Armitage. “When you lower your prices, it can imply that you’re really not providing all the services you promised or that you’re not that good.” Charging us another 0.025% on our account may not seem like much but it can add anger to poor performance and over time can rob your nest egg of up to 25% of possible totals.

Pay less; keep more: https://www.amazon.com/Win-Investment-War-Earn-11/dp/1522916369

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~~America~~

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