Yearly Archives: 2010


A Former Bond Salesman’s Epiphany on Investing

Last month in the New York Times, I read an interesting article about an ex-Wall Street bond salesman’s perspective on investing. Gordon Murray brings to light something I would agree with: most people on Wall Street know very little about personal investing.  In my own experience as an ex-derivatives trader, I admit that I had some things to learn when I made a career shift to help individuals and their families manage their investment portfolios.

To learn more about Murray’s epiphany about personal investing and his book The Investment Answer, please click here to read the NY Times article, “A Dying Banker’s Last Instructions.”

By |December 27th, 2010|Books, Investing|

Consumers are Shopping Again

Despite hovering fears of a double-dip recession since early summer, the U.S. consumer has stood strong.  Research firms ComScore and Retail Metrics recently released data indicating that retailers, especially large chains, are experiencing encouraging sales increases over last year. Yes, consumers are shopping again, and a bright holiday shopping season is in the works.

Beginning Black Friday and continuing throughout the weekend following Thanksgiving, this year’s holiday shopping period started strong and reflected a more hopeful consumer attitude.  Against the ominous backdrop of high unemployment, the Conference Board consumer confidence index hit 54.1 in November, the highest level in five months.  Overall, sales surged more than 7 percent in the past 12 months.  Large retailers performed even better, with a full 85 percent of chains exceeding forecasts.

Cyber Monday, the Monday after Thanksgiving, was the biggest online shopping day in history.  ComScore reports that online spending on Cyber Monday exceeded $1 billion for the first time ever.  More than 9 million shoppers initiated 17 million transactions on Cyber Monday, a 19 percent increase over last year.  Online shoppers jumped on aggressive promotions and discounts, free shipping offers and overall convenience.

More billion-dollar online spending days are expected before the holiday shopping season is over.  And, while growing quickly, online shopping is only around 10 percent of total holiday spending.  One question hanging over the Cyber Monday’s numbers is how much worker productivity was lost on time spent shopping online from work computers.  Perhaps proving there is a survey for everything, CareerBuilder’s annual “holiday shopping from work” survey indicates that almost 30 percent of employees plan to shop on-line at the workplace.

By |December 13th, 2010|Current Affairs|

7 Reasons to Review Your Term Life Insurance

Guest post by Doug Lerner, President, Lerner Group

There are many important reasons to review your term life insurance policy. Here are the top seven.

  1. Are you overpaying? Let’s face it, we are experiencing extreme economic volatility and many people are looking to cut costs any way possible. You may be able to save some money on premiums and extend the term period a few more years. Carrier pricing is extremely competitive right now, which makes it the right time to see if you can improve your situation.
  2. Did you buy your policy from a captive agent? There are many agents who work for a single carrier and may only offer that carrier’s products (examples are All State, State Farm and Northwestern Mutual). There are many more carriers available to an independent agent, which would allow you access to more competitively-priced products.
  3. Did you buy a policy through an internet website? Many individuals think that purchasing a policy online is the easiest and most effective way. Unfortunately, what often happens is the policy is not shopped around to multiple carriers, and the client ends up paying more for a policy. Because each carrier has different health guidelines, it is vital to make sure the appropriate carrier is chosen. A policy purchased online should definitely be reviewed to make sure it is the right choice. There is no cost associated with the use of an agent, so you might as well utilize their services.
  4. Has your family situation changed? If you’ve recently gotten married or had a child, your need for life insurance may have changed. It is often less expensive to buy a new term policy for a larger amount than to supplement your old policy.
  5. Have you bought a house? You may have had enough coverage to support a family, but the added expenses a house brings may have increased your needs.
  6. Have you had a positive change in health? If you have stopped smoking, lost weight, or lowered your blood pressure or cholesterol, you may be able to qualify for a better health rating and lower premium. Life insurance carriers have loosened their underwriting guidelines, especially involving family history and medically controlled health conditions.
  7. Is your current term policy expiring soon? You may be approaching the end of the guaranteed level term period. If you still have a need for coverage, it may make more sense to apply now than to wait until it expires and be subject to substantially higher premiums.
By |December 6th, 2010|Financial Planning, Insurance|

Retirement Accounts & Required Minimum Distribution

The year a person turns 70½ years of age, he or she must begin making an annual Required Minimum Distribution (RMD) from IRAs, 401(k)s and similar retirement plans. According to the IRS, retirement plan participants and IRA owners are responsible for taking the correct amount of RMDs on time every year. Those who fail to do so face stiff penalties — 50 percent of the amount not taken.

You may delay your first RMD until April 1 of the year after you turn 70½; however, you would still need to take your second RMD by December 31 of the same year. For example, if you turned 70 in November 2009. That means you turned 70½ in May 2010. You may take your 2010 RMD by December 31, 2010, or you may wait until April 1, 2011. If you defer, you must take a second distribution — for 2011 — by December 31, 2011.

The RMD rules apply to all qualified retirement plans, such as 401(k)s, 403(b)s and 457s. The rules also apply to IRAs, including contributory, SEPs, Simples and Rollovers. The total IRA RMD can be taken from one account, but it must take into consideration all IRA assets.

Distributions from qualified retirement plans should be taken separately from IRA accounts. If you have multiple qualified retirement accounts, greater complexity is involved and you should contact an advisor. Inherited IRAs are unique distributions, must be taken separately and have special rules.

If you have questions about the required minimum distribution process, don’t hesitate to call your financial advisor.

By |November 29th, 2010|Retirement, Taxes|