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Annuities - Equity Indexed Annuities - Agents Prey On Unsuspecting |
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Tuesday, 03 April 2007 |
By Jeffery Voudrie
Look Out! Millions of Americans feel unsophisticated when they discuss investment opportunities. If you are one of them, beware. A legion of commission-based brokers and insurance agents is just waiting to sell you the ‘perfect investment.’ Unfortunately, it can easily be an investment you will regret for years to come.
I am referring to the latest product served up by the insurance industry that is designed to meet your every investing need. Equity Indexed Annuities (EIAs) are selling like hotcakes. In this Guarding Your Wealth Special Report, I will expose three things you should keep in mind when your broker or agent recommends an EIA to you.
First, EIAs are purchased mainly by people who don’t understand investing and thus don’t understand that better alternatives exist. These investors are sort of like me when it comes to car repair. Because I’m not an expert on engines, I never really know if I can trust the mechanic’s advice, especially since it’s in his best interest to get me to replace as many components as possible. Luckily, I have a friend in the car industry who usually arms me with enough information to keep me from being taken for a ride.
For most people, it is the same when it comes to investing. Because of the world of investing has become so complicated, most investors seek the advice of a professional. But how can you know that what they recommend is really what you need, especially if you know they will make a bundle on the deal? Fortunately, I’m going to give you the information that will keep you from being taken for a ride and regretting your decisions.
That’s why I am so opposed to Equity Indexed Annuities. They are mainly sold to those who don’t understand the realm of investing. Seniors over age 70 are particularly vulnerable. Think about it! If EIAs were such a good investment, wouldn’t experienced investors be buying them? Experienced investors don’t buy EIAs.
Experienced investors aren’t going to lock themselves into an investment for 7,10 or 12 years with only limited choices. Experienced investors recognize that better alternatives exist – alternatives that give them the flexibility to select from a wide range of investment options rather than just a handful. The next two Guarding Your Wealth articles will specifically discuss these alternatives and explain why they are better.
The second point to keep in mind is that those who recommend them may not have your best interests at heart. The advisors recommending EIAs are either insurance agents who don’t have access to better alternatives or brokers who have access to other alternatives but choose the investment that pays the highest commission. The only reason that EIAs require that you keep your money in them for 7,10, 12 years or longer is because it takes the insurance company that long to earn back the commission they paid the broker or agent to sell it to you.
If the ‘professional’ you are talking to gets paid on commission, a tremendous conflict of interest arises when they recommend an EIA. They will make more in one hour by getting you to buy an EIA then you will make in 3 to 4 years at the minimum 3% rate. When an agent or broker has a choice between recommending a product in which they make 1%-2% commission and one in which they could make a 10% commission, which do you think they will recommend?
Third, when hidden motivations and conflicts of interests are removed, EIAs are rarely recommended. Many financial advisors, myself included, get paid solely on management fees as opposed to commissions. If EIAs were such a wonderful investment, wouldn’t it make sense that they would also be widely used by advisors paid by management fees? They aren’t.
Quite frankly, in my friendly opinion, if you are talking to an advisor that recommends you purchase an Equity Indexed Annuity then you should find another advisor. You need to work with someone who has your best interests at heart. You should work with someone who gets paid based on how well they manage your money, not on how adept they are at selling you.
So look out! Explore all of your options and remember—it’s YOUR money!
Mr. Voudrie is a Certified Financial Planner and the President of Legacy Planning Group, Inc., a Private Wealth Management firm in Johnson City, TN. He can be reached at
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@guardingyourwealth.com
Nationally-syndicated financial columnist and Certified Financial Planner® Jeffrey Voudrie provides personal, in-depth money management services and advice to select private clients throughout the USA. He’ll answer your financial question – FREE at http://www.guardingyourwealth.com
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Why You Should Know Technical Analysis |
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Tuesday, 03 April 2007 |
By Paul Zou
No matter which style of investment you are engaged, you have to meet and know the basic of technical analysis. As you know, fundamental analysis and technical analysis are two main ways to forecast the price trend. Fundamental analysis involves researching and evaluating the characteristics of the object. Technical analysis, on the other hand, pays
more attention to price movements.
To understand technical analysis, you have to believe three assumes: all market fundamentals are depicted in the actual market data; history repeats itself and therefore markets move in fairly predictable, or at least quantifiable, patterns; prices move in trends.
Technical analysis is a method of predicting price movements by looking at purely market-generated data. Price data from a particular market is most commonly the type of information analyzed by a technician, though most will also keep a close watch on volume and open interest in futures contracts. Based on these information, there are many technical analysis methods which can be used as a tool to forecast the price trend, such method as chart research and technical indicators.
Chart research is the basic method of technical analysis. You can know a variety of charts patterns that show price action or specific trend. Trend is a term used to describe the persistence of price movement in one direction over time. Trends move in three directions: up, down and sideways.
Technical indicators can be expressed by the value of the indicator. The value will be up, down or same and you can get the signals which are coincident or leading the market. Technical indicators are objecthttp://i.ezinearticles.com/article-management/ezinearticles/ea_editor_manager.php#pv
EzineArticles.com Editors Interfaceive, and you can be objective too.
Almost every trader uses one method or more of technical analysis. Even the most reverent follower of market fundamentals is likely to glance at price charts before executing a trade. At their most basic level, these charts help traders determine ideal entry and exit points for a trade. They provide a visual representation of the historical price action of whatever is being studied.
Genarally speaking, fundamental analysis can only judge which direction the market will move, and technical analysis can supply both direction and price. Remember, fundamental analysis is a very effective way to forecast economic conditions, but not necessarily exact market prices. And anthoer thing you should know is that fundamental analysis is not suitable for you to day trading or short term trading.
As you are only normal individual just like me, you can not get the ongoing first-hand information and should know technical analysis first.
On the surface, it might appear that technicians ignore the fundamentals of the market while surrounding themselves with charts and data tables. However, a technical trader will tell you that all of the fundamentals are already represented in the price. They are not so much concerned that a natural disaster or an awful inflation number caused a recent spike in prices as much as how that price action fits into a pattern or trend. And much more to the point, how that pattern can be used to predict future prices.
The bottom line when utilizing any type of analytical method, technical or otherwise, is to stick to the basics, which are methodologies with a proven track record over a long period. After finding a trading system that works for you, the more esoteric fields of study can then be incorporated into your trading toolbox.
After you have begun trading, the only thing you should do is that you stay focused and disciplined on the strategy or trading method. This will be the only way for you to be successful and profitable.
Paul Zou is the blogger of Make Money Online Online Investment and Work At Home
Featured information for you to work at home and make money online.
You can contact him at email:
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Article Source: http://EzineArticles.com/?expert=Paul_Zou
http://EzineArticles.com/?Why-You-Should-Know-Technical-Analysis&id=499214
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Look Out For The Hidden 401(k) Costs... |
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Tuesday, 03 April 2007 |
By Mark Lund
When it comes to your 401(k), you probably don’t think about fees. After all, your employer foots the bill, right?
Wrong. Employees typically paid mutual-fund expenses, but now more are shouldering administrative expenses, which employers used to pay.
“Fees for 401(k) plans run anywhere from 10 basis points (0.10 percent) for IBM’s plan to 300 basis points (3 percent),” says Ted Benna, who created the first 401(k) plan in 1981 and is founder of the 401(k) Association, a Pennsylvania benefits consulting firm. At a Fortune 500 corporation, your fees are likely to be lower than what you would pay if you worked for a small company; 90 percent of plans cover fewer than 100 participants.
Depending on their size, fees can determine whether your nest egg looks like an ostrich’s or a sparrow’s. Say you invest $50,000 in a plan that charges a 0.5 percent fee, and you enjoy an 8 percent annual return for 30 years. You will retire with $437,748. Pay fees of 1.5 percent and you will have $107,000 less. (Rate of return is for illustrative purposes only)
The fees are not always visible. Typically, a broker will set up a company’s plan at no charge, bundling fees for administering the account with mutual-fund expenses. The broker stuffs the plan with higher-cost share classes, which drain money from employees’ accounts. “In essence, the company shifts the costs of administering the plan directly to the employees,” explained Don Phillips, Managing Director of Morningstar, the Chicago-based mutual-fund research company.
If you or someone you know needs some help managing retirement assets, setting up a retirment savings plan, or have life insurance needs, just give me a call at 801-545-0696 or visit us at www.stonecreekwealthadvisors.com
Respectfully,
Mark K. Lund, CRFA
Wealth Manager
Stonecreek Wealth Advisors, Inc.
10421 So. Jordan Gateway, Suite 600
So. Jordan UT 84095
801-545-0696
Securities offered through Sammons Securities Company, LLC
Member NASD and SIPC
P.S. If there is a topic or question you would like to have explored in one of my newsletters, please feel free to submit any questions or topics for discussion on the enclosed coupon.
Mark K. Lund, CRFA, has spent almost a decade as a Wealth Manager, serving the retirement planning needs for clients in Salt Lake City, Utah. Mark is one of a very small number of retirement planners across the country trained in retirement tax strategies. Most financial professionals typically take only one aspect of your personal finances and attempt to make it grow in a very linear, single-dimensional fashion. That’s why they don’t bother to correlate other items or tax issues in your total financial picture! Mark looks at all four phases of wealth accumulation to plan the most effective way to manage your wealth. To learn more about Mark, please visit http://www.stonecreekwealthadvisors.com
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Tuesday, 03 April 2007 |
By Jonathan Regidor
Forex is a popular way of making money by purchasing and selling different currencies. Unlike a stock market, where we have access to the same prices, the forex market has different levels.
Currencies are purchased and sold across local and global markets, an investments' value increases or decreases based on currency movements. Market conditions can change at any given time according to real world events.
I have been doing some research recently looking for a way of making money without having to be much of an expert. The forex market is an incredible way of profiting and having a full time income easily. The only problem is that its not really that easy unless you can find a good trading system that has many resources available.
Thats when I stumbled across a site with a trading system that I truly have confidence in. Its called Forex Aim, and I am extremely happy with the vast information I was able to obtain from their free e-books. One of the things I love about the e-books are how true they are. There is always a risk in forex, and anybody trying to sell you a system that gives a 100% guarantee is lying. Forex Aim explains that and has many more tips. You can subscribe on their website and get the free download via email.
I have to say that if you guys want to get started with an investment, the forex market is an interesting and rewarding way to do so. Do your research well and look for a reliable system that offers help. Thanks for reading.
Finance researcher
Feel free to visit the site at http://www.forexaim.com/
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http://EzineArticles.com/?Free-Forex-System-Ebooks&id=499518
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Understanding Financial Statement For Better Investing |
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Tuesday, 03 April 2007 |
By Yulianto None
Understanding financial statement can help you a lot in stock investing. It can help you in choosing the right stock. There are three main financial statement: balance sheet, income statement, and statement of cash flow.
Balance sheet shows the financial position of a firm at a particular point of time. Balance sheet shows the firms asset, which are resources used in its operation like cash, office equipment, and building. The balance sheet also shows liabilities (claims of creditor to assets) and stockholders’ equity (claims of owner to assets). The company gets their resources (assets) from borrowing (liabilities) and from their investor (equity). Thus assets = liability + equity.
So how do you know a company is good or not from its balance sheet? A good company will always grow their assets, means that they are expanding. Increasing liability could be good or bad. Too much debt / liability is not good for the company, because it will have more risk. The company might not able to pay all their debt. When reading balance sheet, always check the change of asset, and liability from the same period last year. For example, compare the first three months asset this year with the first three months asset last year. Also, check balance sheet with other company’s balance sheet in the similar industry, preferably the same size. Younger company will grow more then mature company. If company A’s asset grows 10 percent, and company B’s asset grows 20 percent, then it means that company B is better.
Income statement reports the revenue, expenses, and profit (or loss) for a company over a specific interval of time. The most important thing to look for is Net Income, which is the difference between total revenue and total expense during a period. Increasing Net Income is what we look for. Also checks for increasing sales, and decreasing expense.
Another important number is the Earning Per Share (EPS) or how much earning which represents a stock. Increasing EPS is also good, but you must also watch out for outstanding stock. The number of outstanding stock can give you false impression of EPS. So you should cross check with Net Income. Look for growing EPS and Net Income.
Statement cash flow indicates how the cash position of the firm has changed during the period covered by the income statement. The statement of cash flows breaks down the sources and uses of cash into three components: operating, investing, and financing activities. From this, you can know how the company uses and gets its money, like:
• Are they using their money for expanding the business (investing activities) or not.
• How much money do they get from their operation (net income).
• How much money do they pay for their debt.
• How much money do they pay dividend.
By answering to those questions and understanding the company’s balance sheet and income statement, we should know how the company is doing. Are they going to the right direction or not. If you think they are heading to the right direction, you might consider buying their stock.
Yulianto
www.stockpickguide.com
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Tuesday, 03 April 2007 |
By Chad Surges
How dare the stock market take any money from you!
One of the hardest things to control when you first start investing are your emotions. Revenge trading results when you let your emotions control your trading decisions instead of common sense. When you start trying to hard to get back losses you have incurred while trading by rushing into wild random trades you will have fallen victim to revenge trading.
In my opinion, the easiest way to avoid falling victim to revenge trading is to set some solid guidelines that you will stick to without hesitation.
As soon as you make a trade put in a stop-loss order. Do not rely on yourself to control your losses let a stop-loss order do it for you. To many people fall victim to the old methodology that when a stock is going down it will eventually have to come back up. So they hang to a stock that simply keeps going down and down and down. A stop-loss order prevents this from happening and keeps your losses small so you can use your money to invest in more winners than losers.
When you have a trade that does not go well STOP! To many people, including myself when I first started, feel they have to get right back in the game to make up the losses. Just remember the stock market will be there tomorrow and so will another great stock pick. Take a look at the factors that caused your stock pick to go bad and learn from them before jumping into another bad stock pick. Never let your emotions or anything else make you feel like you have to make a stock trade right away.
When trading stocks you have to not become emotional and be willing to accept that not every stock you pick is going to be a winner. So the trick is to control your emotions and get rid of the losers with small losses and then move on without regret.
For more information please visit: http://www.lucky-dog-investing.com
Author: Chad Surges
Degree: Bachelor of Science (Business)
Career: 10 years as a Logistics Executive
Article Source: http://EzineArticles.com/?expert=Chad_Surges
http://EzineArticles.com/?Revenge-Trading&id=500802
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