instructions
stringlengths 9
489
⌀ | user
stringlengths 1
8.98k
⌀ | assistant
stringlengths 1
17k
⌀ |
|---|---|---|
“Correct” answer on Visa credit quiz doesn't make sense | null | I agree with you. The quiz was looking at it differently, as if you had a huge card balance and were making minimum payments. The fact that I run all my spending through my cards somehow looks like my card payments are 60-70% of my budget. But when you break it out, zero of that is interest, and it's just a budgeting tool. |
How many stocks will I own in n years if I reinvest my dividends? | null | Your example shows a 4% dividend. If we assume the stock continues to yield 4%, the math drops to something simple. Rule of 72 says your shares will double in 18 years. So in 18 years, 1000 shares will be 2000, at whatever price it's trading. Shares X (1.04)^N years = shares after N years. This is as good an oversimplification as any. |
Real estate loans for repairs | null | If you intend to flip this property, you might consider either a construction loan or private money. A construction loan allows you to borrow from a bank against the value of the finished house a little at a time. As each stage of the construction/repairs are completed, the bank releases more funds to you. Interest accrues during the construction, but no payments need to be made until the construction/repairs are complete. Private money works in a similar manner, but the full amount can be released to you at once so you can get the repairs done more quickly. The interest rate will be higher. If you are flipping, then this higher interest rate is simply a cost of doing business. Since it's a private loan, you ca structure the deal any way you want. Perhaps accruing interest until the property is sold and then paying it back as a single balloon payment on sale of the property. To find private money, contact a mortgage broker and tell them what you have in mind. If you're intending to keep the property for yourself, private money is still an option. Once the repairs are complete, have the bank reassess the property value and refinance based on the new amount. Pay back the private loan with equity pulled from the house and all the shiny new repairs. |
Why are credit cards preferred in the US? | null | Credit card fraud protection (by law), credit card cash back programs (provided by most CC issuers), and debit card fees (commonly imposed by the merchant). The crux is that with CC transactions, a small percentage is remitted to the issuing bank. Since the banks are already making money hand over fist on CC's, they incentivize people to use them. CC security is also lax because the merchant is responsible for fraudulent charges instead of the bank. If the merchant fails to check a signature, they are held liable for all charges if the card holder reports a fraudulent transaction. |
How can I increase my hourly pay as a software developer? | null | It's a tough thing to do. You should look for a salaried position. Your freelance skills will be much better received, if you've worked for a couple of companies doing programming full time. Nothing beats working at it all day long for a few years. If you're set on being freelance, write some utility that will be popular, and submit it to Freshmeat.net. Now that's asking a lot. Those on the Web looking for programmers will most likely want you to work for 'sweat equity'. That is, a share in the company for you labour. In other words "FREE". I've done my share of those, and if you're just getting into this, you should steer away from them. You may hit the jackpot, but you won't sleep for the next few years ;-) |
Common practice for start/end date of balance sheet | null | One's paycheck typically has a YTD (year to date) number that will end on the latest check of the year. I am paid bi-weekly, and my first 2012 check was for work 12/25 - 1/7. So, for my own balance sheet, brokerage statements and stock valuations end 12/31, but my pay ended 12/24. And then a new sheet starts. |
Is socialtrend.com or/and feelthetrend.com legitimate? | null | It's called a "Pyramid scheme". Its illegal in almost every country of the Western world. You're not going to earn lifetime income, of course, and these things collapse pretty quickly. Most of the "common folks" don't return the investment, its the organizers who take the money. Sometimes they run, most times they end up in jail. The way these schemes work is that they pay the early "investors" from the fees paid by new "investors". As long as a steady stream of new people keep signing up and paying into it those who got in very early make money. The idea is based on the geometric procession of each new person signing up two or more people, and those people doing the same. Pretty quickly at that rate you need to sign up every human being on the planet to keep the new money flowing in to make it work, which obviously is not realistic. Ultimately a small % of the people (if they can stay out of jail) will make a big amount of money the vast majority of "investors" get stiffed. |
Is it a good idea to teach children that work is linearly related to income? | null | As a parent I think you absolutely have to teach them that income is related to work because (for most people at least) it's a more fundamental principle than budgeting, investments, interest, etc. Once they've learned that the primary source of income is work, then you can start teaching them what to do with it, i.e. how to budget, economise, save, invest, etc. |
Can a CEO short his own company? | null | That would be the ultimate in insider trading. They made a stock transaction knowing in advance what was going to happen to the share price. They could easily expect to face jail time, plus the CEO would still face lawsuits from the board of directors, the stockholders and the employees. |
What is the cost of “free” trades? | null | In the case of Wells Fargo, I believe that free trading is linked to your overall banking relationship with the firm. So if you have a checking account with a balance of $X, or a total relationship with the bank ("relationship" is usually defined as loan balances + deposit balances) over a certain amount, they give you a plum like free stock trades. The theory behind this approach is that banks want to be a one-stop shop for you. The idea is that they can market the banks products to you over a period of years (lowering customer acquisition cost) and offer you a level of convenience that allows them to charge a premium for services. For example, many people will pay a rate or fee premium on a mortgage or car loan so that they can do all of their business in one place. In other cases, free trading is linked to marketing campaigns by funds. Charles Schwab started this with the "no transaction fee" mutual fund store many years ago -- transaction fees are actually paid for by the mutual funds who pay for placement in the program. "Free ETF trade" programs are similar. |
What prices are compared to decide a security is over-valued, fairly valued or under-valued? | null | I was wondering how "future cash flows of the asset" are predicted? Are they also predicted using fundamental and/or technical analysis? There are a many ways to forecast the future cash flows of assets. For example, for companies: It seems like calculating expected/required rate using CAPM does not belong to either fundamental or technical analysis, does it? I would qualify the CAPM as quantitative analysis because it's mathematics and statistics. It's not really fundamental since its does not relies on economical data (except the prices). And as for technical analysis, the term is often used as a synonym for graphical analysis or chartism, but quantitative analysis can also be referred as technical analysis. the present value of future cash flows [...] (called intrinsic price/value, if I am correct?) Yes you are correct. I wonder when deciding whether an asset is over/fair/under-valued, ususally what kind of price is compared to what other kind of price? If it's only to compare with the price, usually, the Net asset value (which is the book value), the Discount Cash flows (the intrinsic value) and the price of comparable companies and the CAPM are used in comparison to current market price of the asset that you are studying. Why is it in the quote to compare the first two kinds of prices, instead of comparing the current real price on the markets to any of the other three kinds? Actually the last line of the quote says that the comparison is done on the observed price which is the market price (the other prices can't really be observed). But, think that the part: an asset is correctly priced when its estimated price is the same as the present value of future cash flows of the asset means that, since the CAPM gives you an expected rate of return, by using this rate to compute the present value of future cash flows of the asset, you should have the same predicted price. I wrote this post explaining some valuation strategies. Maybe you can find some more information by reading it. |
Saving $1,000+ per month…what should I do with it? | null | I like the other answers. But, here's one thing that concerns me that hasn't specifically been addressed yet: You mentioned your student loans are at low rates of interest. Are those rates fixed or variable? If those interest rates are variable, I would not count on rates remaining low indefinitely. If you could imagine those rates going up by say 2% or 4% or more over time, would such rates make you change your mind about the debt and the pace at which you're paying it off? I would suggest that as the economy recovers over the next couple of years, the spectre of inflation will force the Fed to raise interest rates. You don't want to be holding variable-rate debt when rates are rising. For that reason, if your loan rate is variable, I would increase your payment amount so you can eliminate your debt sooner than later. Also – You mention in one of your comments that buying a home is 4+ years away. That's not a long time, so I wouldn't commit the bulk of your savings to investing in the stock market, which can be temperamental over short periods of time. You don't want to be in a large loss position just when it's time to buy your first home. However, it may be worth having some of your skin in the game, so to speak. Personally, I would take a balanced approach: 1/3 debt repayment, 1/3 high interest cash savings, and 1/3 in some broad diversified index funds – and not all in the U.S. Although, I also like the idea of getting some travel in while young, so perhaps 1/4 allocations to the money stuff, and 1/4 towards travel? :-) Good luck. |
value of guaranteeing a business loan | null | You should ask the bank supplying the SBA loan about the % of ownership that is required to personally guarantee the loan. Different banks give different figures, but I believe the last time I heard about this it was 20% or more owners must personally guarantee the loan. Before you spend a lot of money on legal fees drawing up a complicated scheme of shares, ask the bank what they require. Make sure you speak with an underwriter since many service people don't know the rules. |
investing - where to trade online? (Greek citizen) | null | You will likely need to open an account in another EU country, like a broker operating out of France, Britain or Germany, to get the best options. If you are comfortable using an english language site and interface, I highly recommend Interactive Brokers as they let you trade in many markets simultaneously, have simple currency conversion, and great tools. But, they are geared toward active traders so you might be better with a more retail oriented broker if you are new to trading stocks. There are many options. Here is a list to start with: |
Using GnuCash for accurate cost basis calculation for foreign investments (CAD primary currency) | null | You would need to use Trading Accounts. You can enable this, File->Properties->Account settings tab, and check Use Trading Accounts. For more details see the following site: http://wiki.gnucash.org/wiki/Trading_Accounts |
Possible replacement for Quicken | null | Do you use any other online features of Quicken? How many unique ticker symbols do you have? How often do you really need to update the prices? You can always continue to use Quicken, and enter the stock prices by hand. Maybe update them once a month to get an idea of how your investments are doing. That should work indefinitely. |
I received $1000 and was asked to send it back. How was this scam meant to work? | null | OK, there is no way in hell that a stranger should have your contact details. there is no way in hell that a stranger should be able to determine your name from that account number unless you are previously known to them. Have they explained to your satisfaction how any previous relationship was established? It was correct to direct them back to their own bank or their branch manager if they bank with the CBA. There are procedures in place for this, and you are in the clear if the bank handles it. Even there is a previous relationship, and you are in their address book, think long and hard about their "bona fides". It may not have been a scam they may have had fat fingers and be genuinely out of pocket now. It is SOP that if you refuse to refund the money the banks will become less helpful. (EDIT - you have consented to retrun the money). EDIT - IF you had not consented... Disclosure: I am a former CBA employee and a 20 year veteran of NetBank, and these are my own opinions. |
What are the benefits of investing in alternative investments? | null | Pros: Why Invest in Alternative Assets
Almost every financial advisor will give you the same investment advice: investing in alternative assets is generally a sound investment decision.
There are several major reasons for this.
1. Low correlation: Correlation refers to the relationship between two assets. Alternatives tend to have a low correlation with the standard asset class. So, alternative asset prices are more likely to move inversely to those trading on the public market.
This makes them useful for diversification and achieving your investment objectives. Investing in hard assets like real estate and commodities can provide the added benefit of acting as a hedge against inflation.
For this reason, many large institutional funds, such as pension funds, often allocate a small portion of their portfolios to alternative investments like hedge funds.
2. Improved risk-return profile: Alternative assets can improve the risk-return profile of an investment portfolio and increase total returns through access to a broader range of investments and strategies.
3. Greater accessibility: Alternative investments have historically been geared towards sophisticated investors. However, it’s becoming easier for everyday retail investors to take advantage. Retail investors also have access to alternative investments like an alternative mutual fund and exchange-traded fund. These alt funds are publicly offered and SEC-registered but may hold non-traditional investments or employ complex investment strategies.
For example, wine investing platforms like Vinovest have made wine investing much more convenient, while others like Masterworks have opened art investments to the general public.
Cons of Alternative Investments
While there are a host of attractive benefits, it’s essential to understand the negatives as well.
1. Tough to value: Some alternative tangible assets can also be challenging to value, depending on their scarcity. The more scarce it is, the tougher it would be to compare historic prices. More so, since companies don’t have to disclose the same financial information, the underlying assets of the alternative investments can be difficult to value.
2. Illiquidity: Alternative investments are often more illiquid and require longer investment timelines than the more traditional options.
After investing, there’s a chance the funds are locked until the investment reaches maturity.
Further, the investment may only mature after five or ten years. And, not every alternative investment will provide returns during this time - some may only payout at the maturity date. This means you need to be acutely aware of any near-term financial needs and investment objectives.
3. Lack of transparency in regulations: Alternative investments aren’t subject to the same regulation as most traditional assets. This lack of regulation in the private market is a risk. It makes alternative assets more opaque than the public market.
For example, let’s look at how the US Securities and Exchange Commission (SEC) views these assets.
Publicly traded investments are subject to the 1940 Investment Act, which regulates investment funds. An exemption in this Act means many alternative investments aren't subject to the same legal structure as traditional asset classes. Also, some of these platforms don't have to register with the SEC, and they’re not overseen or regulated by the agency in the same way as traditional assets are.
4. Accessibility: Some alternative investments are only available to institutional or accredited investors.
(An institutional investor refers to any company or organization that invests on behalf of its clients.
An accredited investor is someone with an income exceeding $200,000 in the previous two years or a joint income of more than $300,000. An accredited investor may also have a net worth exceeding $1 million, excluding the value of the primary residence.)
In any case, the pros outweigh the cons.
It pays to look beyond traditional investment avenues like stocks, bonds, and cash. Alternative investments should form an important part of any investment strategy.
Next, let’s take a look at some alternative assets worth investing in. |
If a stock has only buyers and no sellers how does its price go up? | null | You can, in theory, have the stock price go up without any trading actually occurring. It depends on how the price is quoted. The stock price is not always quoted as the last price someone paid for it. It can also be quoted as the ask price, which is the price a seller is willing to sell at, and the price youd pay if you bought at market. If I am a seller, I can raise the asking price at any time. And if there are no other sellers, or at least none that are selling lower than me, it would look like the price is going up. Because it is, it now costs more to buy it. But no trading has actually occurred. |
What types of careers consistently make the most money entering with no background or social skills? | null | It sounds like you're massively under-selling yourself. You presumably have a degree to get into the PhD program, and you now have work experience as well. But you're applying for jobs in fast food restaurants. You may struggle to get a job because they will expect you to only be there a few weeks until you find a "proper" job. |
Should I finance a new home theater at 0% even though I have the cash for it? | null | I bought a Thinkpad in Dec 2007 using BillMeLater, which was working with IBM/Lenovo at that time. I was getting the notebook at the lowest price available, from the manufacturer. I had the money to pay for it -- around $1400. But I went ahead and took the offer from BillMeLater. It was essentially a 12-month zero-interest credit card balance transfer loan. Sketchy bit its very nature. They spammed my inbox with solicitations, which was annoying. But I set my bank to pay the monthly amount (or slightly over, since it decreases each month) and to make the final payoff -- all at the time of purchase. This worked just fine -- but I still had spam from BillMeLater for quite a while. I still ran a slight risk that something would go wrong, at which point I'd face interest charges -- but I would then have paid off the item plus those interest charges. Luckily I avoided that. I'm not sure I'd bother doing this again, but if the sticker price was high enough, I might be tempted.... |
Visitor Shopping in the US: Would I get tax refund? Would I have to pay anything upon departure? | null | Sales tax and luxury tax is what you will have to pay tax wise, and they are non-refundable (in most cases but the rules vary area to area). This really tripped up some friends of mine I had come from England. The rules are complicated and regional. Sales tax is anywhere from 0% to 10.25% and are not usually applied to raw foods. Luxury taxes are usually state level and only apply to things most people consider a large purchase. Jewelry, cars, houses, etc. Not things your likely to buy. (Small, "normal" jewelry usually doesn't count. Diamond covered flava-flav clock ... probably has a luxury tax.) For sales tax, it can change a lot. Don't be afraid to ask. People ask all the time. It's normal. I personally add 10% to what I buy. Sales tax in my city is 7%, county is 6.5%, state is 6%. So you can get different rates depending on what side of the street you shop on some times. Under normal circumstances you do not get a refund on these taxes. Some states do give refunds. Usually however the trouble of getting that refund isn't worth it unless making a large purchase. You are not exempt from paying sales tax. (Depending on where you go you may get asked). Business are exempt if they are purchasing things to re-sell. Only the end customer pays sales tax. Depending on where you go, online purchases may not be subject to sales tax. Though they might. That, again, depends on city, county, and state laws. Normally, you will have to pay sales tax at the register. It will be calculated into your total, and show as a line item on your receipt. http://3.bp.blogspot.com/-yAvAm2BQ3xs/TudY-lfLDzI/AAAAAAAAAGs/gYG8wJeaohw/s1600/great%2Boutdoors%2Breceipt%2BQR-%2Bbefore%2Band%2Bafter.jpg Also some products have other non-refundable taxes. Rental car taxes, fuel taxes and road taxes are all likely taxes you will have to pay. Areas that have a lot of tourists, usually (but not always) have more of these kinds of taxes. Friendly note. DON'T BUY DVDs HERE! They won't work when you get home. I know you didn't ask but this catches a lot of people. Same for electronics (in many cases, specially optical drives and wireless). |
How can I stop wasting food? | null | The best way to stop wasting food is to create a weekly plan. Every weekend, before making your grocery shopping, take 30-60 mins and plan (with your spouse if your married) for the next week's meals. It doesn't need to be too detailed, but it'll help you to approximate what you need in terms of food for the whole week and buy accordingly. I have a similar problem where I need to go out often and also work a lot. But spending some time on the weekend to create a plan helps me minimize my wastage a lot. My inspiration to do this has been from the below 2 articles from Trent in SimpleDollar http://www.thesimpledollar.com/2008/10/16/how-to-plan-ahead-for-next-weeks-meals-and-save-significant-money-a-step-by-step-guide/ http://www.thesimpledollar.com/2007/09/15/the-one-hour-project-plan-your-meals-for-one-week-in-advance/ |
If gold's price implodes then what goes up? | null | Ok, I think what you're really asking is "how can I benefit from a collapse in the price of gold?" :-) And that's easy. (The hard part's making that kind of call with money on the line...) The ETF GLD is entirely physical gold sitting in a bank vault. In New York, I believe. You could simply sell it short. Alternatively, you could buy a put option on it. Even more risky, you could sell a (naked) call option on it. i.e. you receive the option premium up front, and if it expires worthless you keep the money. Of course, if gold goes up, you're on the hook. (Don't do this.) (the "Don't do this" was added by Chris W. Rea. I agree that selling naked options is best avoided, but I'm not going to tell you what to do. What I should have done was make clear that your potential losses are unlimited when selling naked calls. For example, if you sold a single GLD naked call, and gold went to shoot to $1,000,000/oz, you'd be on the hook for around $10,000,000. An unrealistic example, perhaps, but one that's worth pondering to grasp the risk you'd be exposing yourself to with selling naked calls. -- Patches) Alternative ETFs that work the same, holding physical gold, are IAU and SGOL. With those the gold is stored in London and Switzerland, respectively, if I remember right. Gold peaked around $1900 and is now back down to the $1500s. So, is the run over, and it's all downhill from here? Or is it a simple retracement, gathering strength to push past $2000? I have no idea. And I make no recommendations. |
Why are there many small banks and more banks in the U.S.? | null | Wikipedia has a good summary: Historically, branch banking in the United States - especially interstate branch banking - was viewed unfavorably by regulatory authorities, and this was codified with the enactment of the McFadden Act of 1927, which specifically prohibited interstate banking. Over the next few decades, some banks attempted to circumvent McFadden's provisions by establishing bank holding companies that operated so-called independent banks in multiple states. To address this, The Bank Holding Company Act of 1956 prohibited bank holding companies headquartered in one state from having branches in any other state. Most interstate banking prohibitions were repealed by the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994. Research has also found that anticompetitive state provisions restricted out-of-state growth when those provisions were more restrictive than the provisions set by the Interstate Banking and Branching Efficiency Act or by neighboring states. Some states have also had restrictive bank branch laws; for example, Illinois outlawed branches (other than the main office) until 1967, and did not allow an unlimited number until 1993. |
In what state should I register my web-based LLC? | null | In GA, LLC fees are $50 a year. Incorporating is a one time $100 fee. This information is current as of September 2013. |
Clarification on 529 fund | null | Yes, maybe. The 529 is pretty cool in that you can open an account for yourself, and change the beneficiary as you wish, or not. In theory, one can start a 529 for children or grandchildren yet unborn. Back to you - a 529 is not deductible on your federal return. It grows tax deferred, and tax free if used for approved education. Some states offer deductions depending on the state. There is a list of states that offer such a deduction. |
Online service that computes implied volatility | null | remember that IV is literally the volatility that would be present to equate to the latest price of a particular option contract, assuming the Black-Scholes-Merton model. Yahoo's free finance service lists the IV for all the options that it tracks. |
How can a 'saver' maintain or increase wealth in low interest rate economy? | null | I think this is a good question with no single right answer. For a conservative investor, possible responses to low rates would be: Probably the best response is somewhere in the middle: consider riskier investments for a part of your portfolio, but still hold on to some cash, and in any case do not expect great results in a bad economy. For a more detailed analysis, let's consider the three main asset classes of cash, bonds, and stocks, and how they might preform in a low-interest-rate environment. (By "stocks" I really mean mutual funds that invest in a diversified mixture of stocks, rather than individual stocks, which would be even riskier. You can use mutual funds for bonds too, although diversification is not important for government bonds.) Cash. Advantages: Safe in the short term. Available on short notice for emergencies. Disadvantages: Low returns, and possibly inflation (although you retain the flexibility to move to other investments if inflation increases.) Bonds. Advantages: Somewhat higher returns than cash. Disadvantages: Returns are still rather low, and more vulnerable to inflation. Also the market price will drop temporarily if rates rise. Stocks. Advantages: Better at preserving your purchasing power against inflation in the long term (20 years or more, say.) Returns are likely to be higher than stocks or bonds on average. Disadvantages: Price can fluctuate a lot in the short-to-medium term. Also, expected returns are still less than they would be in better economic times. Although the low rates may change the question a little, the most important thing for an investor is still to be familiar with these basic asset classes. Note that the best risk-adjusted reward might be attained by some mixture of the three. |
Are car buying services worth it? | null | I have used car buying services through Costco and USAA. Twice with a Ford, and once with a Honda. In all instances I was directed to sales people that were uncommonly friendly and pleasant to work with. I was given a deep discount without any negotiation. In two of the three cases I did not have a trade. In one case I had a trade, and negotiated a deeper discount then was originally offered. Did I get a good deal? Eh, who knows? Really it depends what your goal is. If your goal is to avoid negotiation, avoid idiot salesmen, and receive a good discount then a quality car buying service may be for you. My research, a few years old, indicated Costco's program was better then the USAA one. If your goal is get a deep as a discount as possible on a new car, well then you have some work cut out for you. Keep some hand sanitizer handy when you meet one of the slime ball salesmen. Keep in mind that not everyone understand the difference between the words value and cheap. If your goal is to pay as little as possible for quality transportation. Avoid most dealers and new cars. But I don't think that is what you are looking for. |
What options are available for a home loan with poor credit but a good rental history? | null | Take the long term view. Build up the cash. Once you have enough cash in the bank, you don't need a credit score. With 6 months living expenses in the bank after paying 20% down on a small house, he should have no issues getting a reasonably priced mortgage. However, if he waited just a bit longer he might buy the same house outright with cash. When I ran the computations for myself many years ago, it would have taken me half as long to save the money and pay cash for my home as it did for me to take a mortgage and pay it off. |
Returning to the UK after working in Switzerland, What to do with my Swiss Francs? | null | If you "have no immediate plans for the money and will probably not return to Switzerland for a long time or at all" then it might be best just to exchange the money so then you can use/invest it in the UK. Maybe keep a bill or two for memory-sake - I do that whenever I travel to a foreign country. |
What is the opposite of a hedge? | null | There is no opposite of a hedge, except not having a hedge at all. A "hedge" isn't directional. If you are short, you hedge by having something that minimizes your losses if you are wrong. If you are long, you hedge by having something that minimizes your losses if it decreases in value. If you own a house, you hedge by having insurance. There are "hedged bets" and "unhedged bets" |
Where can you find dividends for Australian Stock Market Shares (ASX) for more than 2 years of data? | null | It's difficult to compile free information because the large providers are not yet permitted to provide bulk data downloads by their sources. As better advertising revenue arrangements that mimic youtube become more prevalent, this will assuredly change, based upon the trend. The data is available at money.msn.com. Here's an example for ASX:TSE. You can compare that to shares outstanding here. They've been improving the site incrementally over time and have recently added extensive non-US data. Non-US listings weren't available until about 5 years ago. I haven't used their screener for some years because I've built my own custom tools, but I will tell you that with a little PHP knowledge, you can build a custom screener with just a few pages of code; besides, it wouldn't surprise me if their screener has increased in power. It may have the filter you seek already conveniently prepared. Based upon the trend, one day bulk data downloads will be available much like how they are for US equities on finviz.com. To do your part to hasten that wonderful day, I recommend turning off your adblocker on money.msn and clicking on a worthy advertisement. With enough revenue, a data provider may finally be seduced into entering into better arrangements. I'd much rather prefer downloading in bulk unadulterated than maintain a custom screener. money.msn has been my go to site for mult-year financials for more than a decade. They even provide limited 10-year data which also has been expanded slowly over the years. |
Retirement Options for Income | null | I can think of one major income source you didn't mention, dividends. Rather than withdrawing from your pension pot, you can roll it over to a SIPP, invest it in quality dividend growth stocks, then (depending on your pension size) withdraw only the dividends to live on. The goal here is that you buy quality dividend growth stocks. This will mean you rarely have to sell your investments, and can weather the ups and downs of the market in relative comfort, while using the dividends as your income to live off of. The growth aspect comes into play when considering keeping up with inflation, or simply growing your income. In effect, companies grow the size of their dividend payments and you use that to beat the effects of inflation. Meanwhile, you do get the benefit of principle growth in the companies you've invested in. I don't know the history of the UK stock market, but the US market has averaged over 7% total return (including dividends) over the long term. A typical dividend payout is not much better than your annuity option though -- 3% to 4% is probably achievable. Although, looking at the list of UK Dividend Champion list (companies that have grown their dividend for 25 years continuous), some of them have higher yields than that right now. Though that might be a warning sign... BTW, given all the legal changes around buy-to-lets recently (increases stamp duty on purchase, reduction in mortgage interest deduction, increased paperwork burden due to "right to rent" laws, etc.) you want to check this carefully to make sure you're safe on forecasting your return. |
Passive vs. active investing past performance comparison/data? | null | The Telegraph had an interesting article recently going back 30 years for Mutual's in the UK that had beaten the market and trackers for both IT and UT http://www.telegraph.co.uk/finance/personalfinance/investing/11489789/The-funds-that-have-returned-more-than-12pc-per-year-for-THIRTY-years.html |
Auto insurance on new car | null | $600 a month is high, but may be the best you can do. When I moved from UK to Canada my first insurance quote was $3000 a year, but that was 20 years ago and I was older than 27. The rates go down substantially after you have had a local license for a few years. Best tips for minimising this: |
I'm 23 and was given $50k. What should I do? | null | The best option for maximizing your money long-term is to contribute to the 401(k) offered by your employer. If you park your inheritance in a savings account you can draw on it to augment your income while you max out your contributions to the 401(k). You will get whatever the employer matches right off the bat and your gains are tax deferred. In essence you will be putting your inheritance into the 401(k) and forcing your employer to match at whatever rate they do. So if your employer matches at 50 cents on the dollar you will turn your 50 thousand into 75 thousand. |
Sell your home and invest in growth stock mutual fund | null | It wouldn't surprise me to see a country's return to show Inflation + 2-4%, on average. The members of this board are from all over the world, but those in a low inflation country, as the US,Canada, and Australia are right now, would be used to a long term return of 8-10%, with sub 2% inflation. In your case, the 20% return is looking backwards, hindsight, and not a guarantee. Your country's 10 year bonds are just under 10%. The difference between the 10% gov bond and the 20% market return reflects the difference between a 'guaranteed' return vs a risky one. Stocks and homes have different return profiles over the decades. A home tends to cost what some hour's pay per month can afford to finance. (To explain - In the US, the median home cost will center around what the median earner can finance with about a week's pay per month. This is my own observation, and it tends to be correct in the long term. When median homes are too high or low compared to this, they must tend back toward equilibrium.) Your home will grow in value according to my thesis, but an investment home has both value that can rise or fall, as well as the monthly rent. This provides total return as a stock had growth and dividends. Regardless of country, I can't predict the future, only point out a potential flaw in your plan. |
Why is auto insurance ridiculously overpriced for those who drive few miles? | null | because it cost the insurer more, obviously. while this sounds snarky, it's important to realize that actual insurance companies set their insurance rates based on actual historical costs. for some reason people who report low miles have cost the company more dollars per reported mile than people who report high miles. in that sense, insurance is not overpriced. if it were truly overpriced, then an insurer would specialize in such insurance and make a killing on the free market. the more interesting questions is why do drivers who claim to travel very few miles cost the insurance companies so much per mile? that question has a host of possible answers and it's difficult to say which is the largest cost. here are just a few: |
What does “profits to the shareholders jumped to 15 cents a share” mean? | null | What does it mean in terms of share price? Should the share price increase by 15 cents? No, but you're on the right track. In theory, the price of a share reflects it's "share" of time discounted future earnings. To put it concretely, imagine a company consistently earning 15 cents a share every year and paying it all out as dividends. If you only paid 25 cents for it, you could earn five cents a share by just holding it for two years. If you imagine that stocks are priced assuming a holding period of 20 years or so, so we'd expect the stock to cost less than 3 dollars. More accurately, the share price reflects expected future earnings. If everyone is assuming this company is growing earnings every quarter, an announcement will only confirm information people have already been trading based on. So if this 15 cents announcement is a surprise, then we'd expect the stock price to rise as a function of both the "surprise" in earnings, and how long we expect them to stay at this new profitability level before competition claws their earnings away. Concretely, if 5 cents a share of that announcement were "earnings surprise," you'd expect it to rise somewhere around a dollar. |
What is the tax treatment of scrip dividends in the UK? | null | The HMRC website would explain it better to you. There is a lot of factors and conditions involved, so refer to the HMRC website for clarification. If your question had more details, it could have been easy to pinpoint the exact answer. Do I declare the value of shares as income Why would you do that ? You haven't generated income from that yet(sold it to make a profit/loss), so how can that be declared as income. |
How do financial services aimed at women differ from conventional services? | null | It is just marketing and market segmentation. We could all shop at WalMart, but some people prefer wider aisles and mood music so they shop at Macys. Other people are fine shopping at Target or online. Women face no different challenges. The challenges in investing depend on who you are, where you are in life and what your goals are. I think it is fine to target a certain demographic over another, but they are just trying to make a niche. I prefer to not think about worst case scenarios, and I view all financial advisors with a healthy skepticism, regardless of gender. |
Why is a stock that pays a dividend preferrable to one that doesn't? | null | One reason to prefer a dividend-paying stock is when you don't plan to reinvest the dividends. For example, if you're retired and living off the income from your investments, a dividend-paying stock can give you a relatively stable income. |
Should I charge my children interest when they borrow money? | null | Going from personal experience, my parents let my brother and me borrow money from them all the time. However there was always some noteworthy things to take into account. As an example, I borrowed a large sum of money on my student loan (we will just say it was $50,000). I had saved nearly $30,000 on my own and my parents lent me $10,000. I paid the remaining off over the course of about a year and a half. After this loan was paid off - I started paying my parents back. They dictated that I should not worry about paying them until my other interest loans were paid off. Once they were, my priority was to pay back my parents. Its supposed to help your children get ahead a little bit rather then sucking out interest from them. As long as the money was not needed elsewhere and is spent on something important I would not worry about it. Just make sure they are aware they are expected to pay it back in a reasonable amount of time or with specific requirements (such as after other loans are paid off). |
When does it make financial sense to take advantage of employer's tuition reimbursement program? | null | If you have decided to do the degree, and are simply deciding whether to accept employer funding for it or not, take the funding. I see no difference between "my employer doesn't pay my tuition" and "my employer paid my tuition but I had to pay it back because I moved on". Therefore there is no downside to letting them pay the tuition. If you want to move on before the two years (or whatever) is up, you pay back that interest free loan. You are still ahead over self funding the degree. If you have not decided to do the degree, and are letting the employer-funded tuition figure into your decision process, stop that right now. Doing a degree is hard work. You will either work much longer hours than you do now, or live on a lower salary, or more likely both. You might enjoy it, you might be worth more afterwards, and it might open the door to a raft of careers available only to those with the degree. The actual cost of the tuition is unlikely to be significant in this decision process. Removing it (by assuming the employer pays it) should still not be done. If it's worth doing when you self fund, then do it and relax knowing you won't feel trapped at your employer even if you let them pay it (or lend you the money for it if you end up leaving.) |
How can I decide whether do a masters even if I have go into debt after doing it? | null | What should I do? Weigh your options and decide which education investment lines up better with your goals. Some of the costs from pursuing a degree at the more reputable university may include: However there are probably some benefits to pursuing a degree at this university: You will know best which of these apply to you in addition to any pros or cons not mentioned. You need to evaluate each one in order to make a decision. |
How smart is it to really be 100% debt free? | null | As others mentioned, the only clear reason to remain in debt is if you can find an investment that yields more than what you're paying to maintain the debt. This can happen if a debt was established during low-rate period and you're in a high-rate period (not what is happening now.) A speculative reason to keep debt is as an inflation bet. If you believe money will shortly lose value, you are better off postponing repayment until the drop occurs. However you're not likely to be able to make these bets successfully. Hope this helps |
Who can truly afford luxury cars? | null | Keep in mind your household income is in the top 20%, which does not translate to wealth. Given a healthy income, and no debt, other then a small house payment, you probably have a decent amount of free cash flow. This could easily be used to buy a car on time… which a lot of people do. Congratulations on being different. Having said that, living as you do, you will likely be wealthier than your income suggests. If you invested the amount you saved on car payments for an average car you can become a muli-millionaire. Doing that alone can put you in the top 10% of the wealthiest in this nation. Keep in mind 76% of Americans live paycheck-to-paycheck, so there is a sizable portion of the population that make more than you do, yet one costly emergency can cause them to spiral into significant financial difficulty. News flash: Emergencies happen. If I am not being clear, you are living wisely! I would recommend reading The Millionaire Next Door and The Millionaire Mind. You will understand that not following the whims of advertisers is good for your bottom line and that it is good to be different from the general population. One of my favorite stories from the author is these yuppies hires the author to find them rich people to sell their products. The author gets the rich people by offering them cash, albeit a relatively small amount considering their wealth (about $200) and lunch. The yuppies complain that the guys don’t “look rich” as there are no fancy suits or Rolex watches. One of the rich guys likes the pitch so much in inquires on how he can buy the company. There are a lot of lessons in that short anecdote. |
How to make an investment in a single company's stock while remaining market-neutral? | null | You can employ a hedging strategy using short selling, put options, or other methods that will partially neutralize your exposure to the overall market. e.g. You could short sell a market-wide index such as the S&P500, while going long (buying) the company you are interested in. Investopedia has a nice primer on this: Also, see this related question here: |
Is it true that more than 99% of active traders cannot beat the index? | null | What decision are you trying to make? Are you interested day trading stocks to make it rich? Or are you looking at your investment options and trying to decide between an actively managed mutual fund and an ETF? If the former, then precise statistics are hard to come by, but I believe that 99% of day traders would do better investing in an ETF. If the latter, then there are lots of studies that show that most actively managed funds do worse than index funds, so with most actively managed funds you are paying higher fees for worse performance. Here is a quote from the Bogleheads Guide to Investing: Index funds outperform approximately 80 percent of all actively managed funds over long periods of time. They do so for one simple reason: rock-bottom costs. In a random market, we don't know what future returns will be. However, we do know that an investor who keeps his or her costs low will earn a higher return than one who does not. That's the indexer's edge. Many people believe that your best option for investing is a diverse portfolio of ETFs, like this. This is what I do. |
I carelessly invested in a stock on a spike near the peak price. How can I salvage my investment? | null | Yes, you could sell what you have and bet against others that the stock price will continue to fall within a period of time "Shorting". If you're right, your value goes UP even though the stock price goes down. This is a pretty darn risky bet to make. If you're wrong, there's no limit to how much money you can owe. At least with stocks they can only fall to zero! When you short, and the price goes up and up and up (before the deadline) you owe it! And just as with stocks, someone else has to agree to take the bet. If a stock is pretty obviously tanking, its unlikely that someone would oppose your bet. (It's probably pretty clear that I barely know what I'm talking about, but I was surprised not to see this listed among the answers.) |
1099-MISC vs K-1 — duplicated numbers? | null | Well, you won't be double taxed based on what you described. Partners are taxed on income, typically distributions. Your gain in the partnership is not income. However, you were essentially given some money which you elected to invest in the partnership, so you need to pay tax on that money. The question becomes, are you being double taxed in another way? Your question doesn't explain how you invested, but pretty much the options are either a payroll deduction (some amount taken out of X paychecks or a bonus) or some other payment to you that was not treated as a payroll deduction. Given that you got a 1099, that suggests the latter. However, if the money was taken out as a payroll deduction - you've already paid taxes (via your W2)! So, I'd double check on that. Regarding why the numbers don't exactly match up - Your shares in the partnership likely transacted before the partnership valuation. Let's illustrate with an example. Say the partnership is currently worth $1000 with 100 outstanding shares. You put up $1000 and get 100 shares. Partnership is now worth $2000 with 200 outstanding shares. However, after a good year for the firm, it's valuation sets the firm's worth at $3000. Your gain is $1500 not $1000. You can also see if what happened was the firm's valuation went down, your gain would be less than your initial investment. If instead your shares transacted immediately after the valuation, then your gain and your cost to acquire the shares would be the same. So again, I'd suggest double checking on this - if your shares transacted after the valuation, there needs to be an explanation for the difference in your gain. For reference: http://smallbusiness.findlaw.com/incorporation-and-legal-structures/partnership-taxes.html And https://www.irs.gov/publications/p541/ar02.html Here you learn the purpose of the gain boxes on your K1 - tracking your capital basis should the partnership sell. Essentially, when the partnership is sold, you as a partner get some money. That money is then taxed. How much you pay will depend on what you received versus what the company was worth and whether your gain was long term or short term. This link doesn't go into that detail, but should give you a thread to pull. I'd also suggest reading more about partnerships and K1 and not just the IRS publications. Don't get me wrong, they're a good source of information, just also dense and sometimes tough to understand. Good luck and congrats. |
$700 guaranteed to not be touched for 15 years+, should I put it anywhere other than a savings account? | null | (Since you used the dollar sign without any qualification, I assume you're in the United States and talking about US dollars.) You have a few options here. I won't make a specific recommendation, but will present some options and hopefully useful information. Here's the short story: To buy individual stocks, you need to go through a broker. These brokers charge a fee for every transaction, usually in the neighborhood of $7. Since you probably won't want to just buy and hold a single stock for 15 years, the fees are probably unreasonable for you. If you want the educational experience of picking stocks and managing a portfolio, I suggest not using real money. Most mutual funds have minimum investments on the order of a few thousand dollars. If you shop around, there are mutual funds that may work for you. In general, look for a fund that: An example of a fund that meets these requirements is SWPPX from Charles Schwabb, which tracks the S&P 500. Buy the product directly from the mutual fund company: if you go through a broker or financial manager they'll try to rip you off. The main advantage of such a mutual fund is that it will probably make your daughter significantly more money over the next 15 years than the safer options. The tradeoff is that you have to be prepared to accept the volatility of the stock market and the possibility that your daughter might lose money. Your daughter can buy savings bonds through the US Treasury's TreasuryDirect website. There are two relevant varieties: You and your daughter seem to be the intended customers of these products: they are available in low denominations and they guarantee a rate for up to 30 years. The Series I bonds are the only product I know of that's guaranteed to keep pace with inflation until redeemed at an unknown time many years in the future. It is probably not a big concern for your daughter in these amounts, but the interest on these bonds is exempt from state taxes in all cases, and is exempt from Federal taxes if you use them for education expenses. The main weakness of these bonds is probably that they're too safe. You can get better returns by taking some risk, and some risk is probably acceptable in your situation. Savings accounts, including so-called "money market accounts" from banks are a possibility. They are very convenient, but you might have to shop around for one that: I don't have any particular insight into whether these are likely to outperform or be outperformed by treasury bonds. Remember, however, that the interest rates are not guaranteed over the long run, and that money lost to inflation is significant over 15 years. Certificates of deposit are what a bank wants you to do in your situation: you hand your money to the bank, and they guarantee a rate for some number of months or years. You pay a penalty if you want the money sooner. The longest terms I've typically seen are 5 years, but there may be longer terms available if you shop around. You can probably get better rates on CDs than you can through a savings account. The rates are not guaranteed in the long run, since the terms won't last 15 years and you'll have to get new CDs as your old ones mature. Again, I don't have any particular insight on whether these are likely to keep up with inflation or how performance will compare to treasury bonds. Watch out for the same things that affect savings accounts, in particular fees and reduced rates for balances of your size. |
What are some well known or well regarded arguments against investing? | null | I think you're confusing risk analysis (that is what you quoted as "Taleb Distribution") with arguments against taking risks altogether. You need to understand that not taking a risk - is by itself a risk. You can lose money by not investing it, because of the very same Taleb Distribution: an unpredictable catastrophic event. Take an example of keeping cash in your house and not investing it anywhere. In the 1998 default of the Russian Federation, people lost money by not investing it. Why? Because had they invested the money - they would have the investments/properties, but since they only had cash - it became worthless overnight. There's no argument for or against investing on its own. The arguments are always related to the investment goals and the risk analysis. You're looking for something that doesn't exist. |
What options do I have at 26 years old, with 1.2 million USD? | null | Former financial analyst here, happy to help you. First off, you are right to not be entirely trusting of advisors and attorneys. They are usually trustworthy, but not always. And when you are new to this, the untrustworthy ones have a habit of reaching you first - you're their target market. I'll give you a little breakdown of how to plan, and a starting investment. First, figure out your future expenses. A LOT of that money may go to medical bills or associated care - don't forget the costs of modifications and customizations to items so you can have a better quality of life. Cars can be retrofit to assist you with a wheelchair, you can build a chair lift into a staircase, things like that which will be important for mobility - all depending on the lingering medical conditions. Mobility and independence will be critically important for you. Your past expenses are the best predictor of future expenses, so filter out the one-time legal and medical costs and use those to predict. Second, for investing there is a simple route to get into the stock market, and hopefully you will hear it a lot: Exchange Traded Funds (ETFs). You'll hear "The S&P 500 increased by 80 points today..." on the news; the S&P is a combination of 500 different stocks and is used to gauge the market overall. You can buy an exchange traded fund as a stock, and it's an investment in all those components. There's an ETF for almost anything, but the most popular ones are for those big indexes. I would suggest putting a few hundred thousand into an S&P 500 indexed ETF (do it at maybe $10,000 per month, so you spread the money out and ensure you don't buy at a market peak), and then let it sit there for many years. You can buy stocks through online brokerages like Scottrade or ETrade, and they make it fairly easy - they even have local offices that you can visit for help. Stocks are the easiest way to invest. Once you've done this, you can also open a IRA (a type of retirement account with special tax benefits) and contribute several thousand dollars to it per year. I'll be happy to give more advice if/when you need it, but there are a number of good books for beginning investors that can explain it better than I. I would suggest that you avoid real estate, especially if you expect to move overseas, as it is significantly more complicated and has maintenance costs and taxes. |
Why is tax loss harvesting helpful for passive investing? | null | The harvested losses are capital losses. See this IRS page: Generally, realized capital losses are first offset against realized capital gains. Any excess losses can be deducted against ordinary income up to $3,000 ($1,500 if married filing separately) on line 13 of Form 1040. Losses in excess of this limit can be carried forward to later years to reduce capital gains or ordinary income until the balance of these losses is used up. This means that your harvested losses can be used to offset ordinary income --- up to $3000 in a single year, and with extra losses carried forward to future years. It is pretty close to a free lunch, provided that you have some losses somewhere in your portfolio. This free lunch is available to anyone, but for a human, it can be quite a chore to decide when to sell what, keep track of the losses, and avoid the wash sale rules. The advantage of robo-advisors is that they eat that kind of bookkeeping for breakfast, so they can take advantage of tax loss harvesting opportunities that would be too cumbersome for a human to bother with. |
What's the best application, software or tool that can be used to track time? | null | A free solution that I've been using is Task Coach. It has tasks, subtasks, categories, and all the stuff you would expect from a time tracking program. It also counts each distinct period spent on a task as a separate "effort" that you can add comments, for example to remind you what that chunk of time was spent on. |
If one owns 75% of company shares, does that mean that he would have to take upon himself 75% of the company's expenses? | null | You can look at the company separately from the ownership. The company needs money that it doesn't have, therefore it needs to borrow money from somewhere or go bankrupt. And if they can't get money from their bank, then they can of course ask people related to the company, like the two shareholders, for a loan. It's a loan, like every other loan, that needs to be repaid. How big the loan is doesn't depend on the ownership, but on how much money each one is willing and capable of giving. The loan doesn't give them any rights in the company, except the right to get their money back with interest in the future. Alternatively, such a company might have 200 shares, and might have given 75 to one owner and 25 to the other owner, keeping 100 shares back. In that case, the shareholders can decide to sell some of these 100 shares. I might buy 10 shares for $1,000 each, so the company has now $10,000 cash, and I have some ownership of the company (about 9.09%, and the 75% and 25% shares have gone down, because now they own 75 out of 110 or 25 out of 110 shares). I won't get the $10,000 back, ever; it's not a loan but the purchase of part of the company. |
Company asking for card details to refund over email | null | Definitely push for a check, they may not do anything nefarious with your credit card number however someone else may be able to read the email before it gets to its final destination. It's never safe to give out credit card number in a less than secure interface. Also, if this is a well known company, then the person interacting with you should know better than to ask for your information through email. |
If a stock doesn't pay dividends, then why is the stock worth anything? | null | Remember that long term appreciation has tax advantages over short-term dividends. If you buy shares of a company, never earn any dividends, and then sell the stock for a profit in 20 years, you've essentially deferred all of the capital gains taxes (and thus your money has compounded faster) for a 20 year period. For this reason, I tend to favor non-dividend stocks, because I want to maximize my long-term gain. Another example, in estate planning, is something called a step-up basis: |
How does one value Facebook stock as a potential investment? | null | To know if a stock is undervalued is not something that can be easily assessed (else, everybody would know which stock is undervalued and everybody will buy it until it reaches its "true" value). But there are methods to assess the value of a company, I think that the 3 most known methods are: If the assets of the company were to be sold right now and that all its debts were to be paid back right now, how much will be left? This remaining amount would be the fundamental value of your company. That method could work well on real estate company whose value is more or less the buildings that they own minus of much they borrowed to acquire them. It's not really usefull in the case of Facebook, as most of its business is immaterial. I know the value of several companies of the same sector, so if I want to assess the value of another company of this sector I just have to compare it to the others. For example, you find out that simiral internet companies are being traded at a price that is 15 times their projected dividends (its called a Price Earning Ratio). Then, if you see that Facebook, all else being equal, is trading at 10 times its projected dividends, you could say that buying it would be at a discount. A company is worth as much as the cash flow that it will give me in the future If you think that facebook will give some dividends for a certain period of time, then you compute their present value (this means finding how much you should put in a bank account today to have the same amount in the future, this can be done by dividing the amount by some interest rates). So, if you think that holding a share of a Facebook for a long period of time would give you (at present value) 100 and that the share of the Facebook is being traded at 70, then buy it. There is another well known method, a more quantitative one, this is the Capital Asset Pricing Model. I won't go into the details of this one, but its about looking at how a company should be priced relatively to a benchmark of other companies. Also there are a lot's of factor that could affect the price of a company and make it strays away from its fundamental value: crisis, interest rates, regulation, price of oil, bad management, ..... And even by applying the previous methods, the fundemantal value itself will remain speculative and you can never be sure of it. And saying that you are buying at a discount will remain an opinion. After that, to price companies, you are likely to understand financial analysis, corporate finance and a bit of macroeconomy. |
Should withheld income tax be included as income? | null | Does it make sense to report withheld tax income as an additional income? Is it required by the IRS? Is $T deductible? This is what is called imputed income. The ticket is an income for you, but the company doesn't want you to pay tax on it. But you have to. But they want to be nice to you and give you the ticket on their buck. But that's the law. So what have the accountants invented? Imputed income. The company raises your salary in the amount of taxes paid (+some, but that's negligible), in addition to the actual ticket. So it seems, to you, that you got the ticket for free. The IRS doesn't see the ticket, it just sees that you got a $T+$X bonus and paid $T taxes. The fact that the $X you got in form of a ticket doesn't matter to them. Re your edit - you cannot deduct anything, since you can only deduct unreimbursed expenses, whereas $X is not at all an expense for you (you didn't buy that ticket, the company did), and $T is taxes, which are not deductible (its not an expense). In other words, had C not have been nice, I would be in a better position! No. Your net pay shouldn't be affected, technically, so from your perspective you just got a plane ticket for free. Had C not been nice, you would still not be able to deduct the whole cost of $X, because unreimbursed employee expenses have a 2% AGI threshold. |
Long(100%)-Short(-100%) investment explanation | null | When portfolio positions are reported in percentages, those percentages are relative to the portfolio's base equity. When you start out, that is equal to the cash you have in a portfolio. Later it's the net equity of the portfolio (i.e., how much money you could withdraw if you were to exit all your positions). If you put $5,000 into your account and are long and short 50%, then you are long $2,500 and short $2,500. If it's 100% and -100%, then long and short $5,000. "Leverage" is often computed gross (as if all positions were long). So if you have 100% and -100%, then your broker may say you are "levered 2 to 1." That is, your gross exposure is twice as large as your underlying base equity. |
How long should I keep my bills? | null | Consumerist posted a list of how long to keep bills. |
buying a stock while the price is going down, and buy it at a lower price | null | If you bought them, you can sell them. That does not preclude you from buying again later. You might get yourself into a situation where you need to account for a so-called "wash sale" on your taxes, but your broker should calculate that and report it on your 1099-B at the end of the year. There's nothing illegal about this though - It's just a required step in the accounting of capital gains for tax purposes. |
New car cash vs finance | null | Yes, maybe. Sometimes the mother company (that makes the car) covers a bit of the loss that comes from the super-offer loan, so the dealer loses a bit less. But generally, you are right. you should be able to talk them into some rebate that gets you around the given number, depending on how good you are a negotiator (and how urgently they need to sell a car) |
Why do gas stations charge different amounts in the same local area? | null | One factor I haven't seen mentioned is volume. Suppliers will charge a slightly lower price to the station if they buy in full tanker truck loads instead of smaller quantities. Where I am this is probably still the largest factor in price spread with all newer bigger stations being 20-30 cents cheaper than the old small ones (often a repair shop with 2 pumps out front); the only reason it's slowly becoming less pronounced is that the old small stations are steadily closing up as their tanks fail leak inspections because they don't sell enough gas to justify repair and replacement. |
When a company liquidates, are earlier investors paid back first? | null | Assuming no debt, as you've specified in the comments to your question, the assets should generally be distributed proportional to ownership share. BUT, without any sort of agreement, there might be contention on what each investor's share is and that might get fought out in court. With a corporation issuing shares, the corporate charter probably defines the relationship between different classes of shares (or specifies only one class). For a partnership though, you could conceivable have people making claims of ownership stake based on labor in addition to any cash that they put up. Messy if there's no up-front agreement. |
Should I buy a house with a friend? | null | I'd be curious to compare current rent with what your overhead would be with a house. Most single people would view your current arrangement as ideal. When those about to graduate college ask for money advice, I offer that they should start by living as though they are still in college, share a house or multibedroomed apartment and sack away the difference. If you really want to buy, and I'd assume for this answer that you feel the housing market in your area has passes its bottom, I'd suggest you run the numbers and see if you can buy the house, 100% yours, but then rent out one or two rooms. You don't share your mortgage details, just charge a fair price. When the stars line up just right, these deals cost you the down payment, but the roommates pay the mortgage. I discourage the buying by two or more for the reasons MrChrister listed. |
Should I sell my stocks to put a down payment on a house before it becomes a long term investment? | null | In the United States Short-term capital gains are taxed at rates similar to regular income which is 25% if you make less than $91,000 and 28% if you make more than that but less than $190,000. If you make more than $190,000 then the rate is 33%. If you hold the stock for a year or more than the tax rate is 15%, unless your income is less than $33,000 in which case there is no tax on long-term gains. As a general rule, the way to make money is to stay out of debt, so I cannot advise you to assume a mortgage. Financially you are better off investing your money. Much like you I bought a house with a mortgage using about $30,000 in a down payment about 20 years ago and I paid it off a few years ago. If I had to do it over again, I would have bought a shack (a steel building) for $30,000 and lived in that and invested my income. If I had done that, I would be about $500,000 richer today than I am now. |
Typical discount for cash purchase on $1+ million homes? | null | I don't have a solid data-backed answer, but this is too lengthy for a comment. I've read that on average, about 1-2% is what you can get as a cash discount on a home purchase, all else being equal, but no hard data to back that. In certain situations it makes sense for a cash discount to be much greater than that, for instance, if the seller is in a hurry to close and your cash offer has no inspection clause. Similarly, if a house has been re-listed after a sale fell through you might get a greater cash-discount, or if an owner just over-values the advantages of a cash-offer. Anecdotally, I had a neighbor take a cash offer 5% below asking and they had multiple offers at asking, they took the cash offer so they could close faster (15 days). Also, I've lost out to a cash offer, also at 5% below asking, and they also had a short-closing period and no-inspection, my offer was over asking on that one, so total cash discount > 5%. There can be more volatility in the luxury home market, but I wouldn't guess that changes the cash vs financed evaluation much. Would love to see if anyone finds a good source, but even if they do, an average is only so helpful. |
Equity market inflow meaning | null | Inflows to the US equity market can come from a variety of sources; for instance: You were paid a year-end bonus and decided to invest it in US equities instead of foreign equities, bonds, savings or debt reduction. You sold foreign equities, bonds, or other non-US equities and decided to invest in US equities. You decided a better use of cash in a savings account, CD or money market fund, was to invest in US equities. If for every buyer, there's a seller, doesn't that also mean that there were $25B in outflows in the same time period? Not necessarily. Generally, the mentions we see of inflows and outflows are net; that is, the gross investment in US equities, minus gross sales of US equities equals net inflows or outflows. The mere fact that I sold my position in, say, Caterpillar, doesn't mean that I had to re-invest in US equities. I may have bought a bond or a CD or a house. Because of fluctuations in existing stocks market value, bankruptcies and new issues, US equities never are and never will be a zero-sum game. |
Refinance when going to sell? | null | In the first years of a loan, most of what you're paying is interest, so my guess is that this is a bad idea. But there are lots of mortgage calculators offered for free on the web (your bank's website may have one) so I'd suggest that you spend some time running actual numbers before deciding. Reminder: Most renovations do NOT pay for themselves in increased sales price, not least because you'll lose the buyers who don't like what you've done but would have been happy to renovate it themselves to their own tastes. Unless there is something which will actively impair your ability to sell the house, you should usually renovate when you plan to stay there for a while and take your returns in enjoying the house more, NOT on the way out. (There's been some recent discussion of this over in Home Improvement, pointing out that the changes which return more than they cost are usually simple things like refreshing the paint, "staging" the house so it looks lived in but not cluttered, replacing damaged blinds, washing windows, putting out a few more flowers, and so on.) |
Using business check to pay at retail | null | You can just buy the items personally and then submit an expense report to the company to get reimbursed. Keep all the receipts. Paying with a company check is also fine, but you might run into problems with stores not accepting checks. |
Can I cover a short sale with the stock I already own? | null | Yes, you call the broker and tell him to use those shares to deliver to the short position. |
How can I lookup the business associated with a FEIN? | null | If it is Texas company, you can try doing a taxable entity search on the Texas Comptroller website. |
What to do with a 50K inheritance [duplicate] | null | The basic optimization rule on distributing windfalls toward debt is to pay off the highest interest rate debt first putting any extra money into that debt while making minimum payments to the other creditors. If the 5k in "other debt" is credit card debt it is virtually certain to be the highest interest rate debt. Pay it off immediately. Don't wait for the next statement. Once you are paying on credit cards there is no grace period and the sooner you pay it the less interest you will accrue. Second, keep 10k for emergencies but pretend you don't have it. Keep your spending as close as possible to what it is now. Check the interest rate on the auto loan v student loans. If the auto loan is materially higher pay it off, then pay the remaining 20k toward the student loans. Added this comment about credit with a view towards the OP's future: Something to consider for the longer term is getting your credit situation set up so that should you want to buy a new car or a home a few years down the road you will be paying the lowest possible interest. You can jump start your credit by taking out one or two secured credit cards from one of the banks that will, in a few years, unsecure your account, return your deposit, and leave no trace you ever opened a secured account. That's the route I took with Citi and Wells Fargo. While over spending on credit cards can be tempting, they are, with a solid payment history, the single most important positive attribute on a credit report and impact FICO scores more than other type of credit or debt. So make an absolute practice of only using them for things you would buy anyway and always, always, pay each monthly bill in full. This one thing will make it far easier to find a good rental, buy a car on the best terms, or get a mortgage at good rates. And remember: Credit is not equal to debt. Maximize the former and minimize the latter. |
RSU Tax Implications of 83(b) Election | null | I can make that election to pay taxes now (even though they aren't vested) based on the dollar value at the time they are granted? That is correct. You must file the election with the IRS within 30 days after the grant (and then attach a copy to that year's tax return). would I not pay any taxes on the gains because I already claimed them as income? No, you claim income based on the grant value, the gains after that are your taxable capital gains. The difference is that if you don't use 83(b) election - that would not be capital gains, but rather ordinary salary income. what happens if I quit / get terminated after paying taxes on un-vested shares? Do I lose those taxes, or do I get it back in a refund next year? Or would it be a deduction next year? You lose these taxes. That's the risk you're taking. Generally 83(b) election is not very useful for RSUs of established public companies. You take a large risk of forfeited taxes to save the difference between capital gains and ordinary gains, which is not all that much. It is very useful when you're in a startup with valuations growing rapidly but stocks not yet publicly trading, which means that if you pay tax on vest you'll pay much more and won't have stocks to sell to cover for that, while the amounts you put at risk are relatively small. |
Why is day trading considered riskier than long-term trading? | null | It's important to distinguish between speculation and investing. Buying something because you hope to make money on market fluctuations is speculation. Buying something and expecting to make money because your money is providing actual economic value is investing. If Person A buys 100 shares of a stock with the intent of selling them in a few hours, and Person B buys 100 shares of the same stock with the intent of holding on to it for a year, then obviously at that point they both have the same risk. The difference comes over the course of the year. First, Person B is going to be making money from the economic value the company provides over the whole year, while the only way Person A can make money is from market fluctuation (the economic value the company provides over the course of an hour is unlikely to be significant). Person B is exposed to the risk of buying the stock, but that's counterbalanced by the profit from holding the stock for a year, while Person A just has the risk. Second, if Person A is buying a new stock every hour, then they're going to have thousands of transactions. So even though Person B assumed just as much risk as Person A for that one transaction, Person A has more total risk. |
What should I do with my money? | null | Edit: I a in the United States, seek advice from someone who is also in Australia. I am getting about 5.5% per year by investing in a fund (ticker:PGF) that, in turn, buys preferred stock in banks. Preferred stock acts a bit like a bond and a bit like a stock. The price is very stable. However, a bank account is FDIC insured (in the USA) and an investment is not. I use the Reinvestment program at Scottrade so that the monthly dividends are automatically reinvested with no commission. However I do not know if this is available outside of the United States. Investing yealds greater returns but exposes you to greater risk. You have to know your risk tolerance. |
Are online mortgage lenders as good as local brick-and-mortar ones? | null | At least five of my co-workers are currently re-financing through Amerisave. Four have had a wonderful experience. The fifth has been dealing with a representative who constantly misunderstands him, asks for duplicate paperwork, and is in general fairly annoying to deal with. He is willing to go through the hassle because he found the lowest rates through them. All five co-workers recommend Amerisave despite this one co-worker's difficulties. Another person I know has refinanced through mortgagefool.com twice with good results. In general I think online lenders are like brick and mortar lenders in that some will be good, some will be not-so-good. |
Why are interest rates on saving accounts so low in USA and Europe? | null | Banks in general will keep saving rates as low as possible especially if there is a surplus of funds or alternative access for funding as in the case of the Fed in the USA. Generally speaking, why would bank pay you a high interest rate when they cannot generate any income from your money? Usually we will expect to see a drop in the loan interest rate when their is a surplus of funds so as to encourage investment. But if the market is volatile then no banks will allow easy access to money through loans. The old traditional policy of lending money without proper security and no control from the central bank has created serious problems for savings account holders when some of these banks went into bankruptcy. It is for this reason most countries has modified their Financial Act to offer more protection to account holders. At the moment banks must follow rigid guidelines before a loan can be approved to a customer. In my country (Guyana) we have seen the collapse of a few banks which sent a shock wave across the county for those that have savings held at those bank. We have also seen unsecured loans having to be written off thus putting serious pressure of those banks. So government stepped in a few years ago and amended the act to make it mandatory to have commercial banks follow certain strict guidelines before approving a loan. |
Do I live in a state for tax purposes if my permanent home is in another state? | null | You're most likely required to file in both for 2013 - since you've lived in both. From 2014 and on you're definitely a NY resident (since you're renting a place there and live there), and you may very well continue being NJ resident (since you're essentially continue being domiciled there). I suggest talking to a EA/CPA licensed in NY and NJ to try and see what you can do to avoid being resident in both the states, or see if it is at all an issue other than filing everything double. |
What is the next step to collect money after a judgment has been ignored? | null | According to LegalZoom: If your debtor is unwilling to pay and you know they have the means, it's time to use your local sheriff. You have three options to collect: a bank levy, wage garnishment, or a real estate lien. It sounds like you'll need to reach out to your local police/sheriff's department and they can further help you out and get you your money. |
Is it legal if I'm managing my family's entire wealth? | null | All the other answers posted thus far discuss matters from the perspective of US tax laws and are unanimous in declaring that what the OP wants to do is indeed a very bad idea. I fully agree: it is a bad idea from the perspective of US tax laws, and is likely a bad idea from the perspective of Indian tax laws too, but what the OP wants to do is (or used to be) common practice in India. In more recent times, India has created a Permanent Account Number ("PAN number") for each taxpayer for income tax purposes, and each bank account or investment must have the owner's (or first-named owner's, in case of a joint account) PAN number associated with it. This most likely has decreased the popularity of such arrangements, or has led to new twists being used. The OP has not indicated the residence and citizenship of his family (or his own status for that matter), but if they are all Indian citizens resident in India and are Hindus, then there might be one mechanism for doing what the OP wants to do: apply for a PAN number in the name of the Hindu Undivided Family and use this number to carry out the investments in the name of the Hindu Undivided Family. (There presumably are similar statuses for undivided families for other religions, but I am not familiar with them). There are lots of matters here which are more legal questions than personal finance questions: e.g. if the OP is a US tax resident, then the family presumably will not be able to claim Hindu Undivided Family status since the OP has been divided from the family for tax purposes (or so I think). Even if HUF status is available, the OP might not be able to act as the pater familias while his father is alive, and so on. Consultation with tax lawyers, not just chartered accountants, in India is certainly advisable. |
How can I diversify investments across currencies in ISA? | null | You have to check if the investment vehicle you are planning to buy is acceptable for ISA on a case by case. Then if it is allowed by HMRC you have to check that your ISA provider offers those products (the mainstream providers might offer a more limited range of products and you might have to go to change your provider) |
How does leverage work? | null | For sake of simplicity, say the Euro is trading at $1.25. You have leveraged control of $100,000 given the 100x leverage. If you are bullish on the Euro, you are long 80,000 euros. For every 1% it rises, you gain $1000. If it drops by the same 1%, you are wiped out, you lost your $1000. With the contracts I am familiar with, there is a minimum margin, and your account is "marked to market" each night. If your positive balance drops too low, you get the margin call. It's a zero sum game, for every dollar you make, there's a guy on the other side of the trade. Odds are he's doing this full time and is smarter than you. |
If I send money to someone on student visa in USA, will he need to pay taxes on that? | null | First: I am not a tax lawyer. This is just an educated opinion; not a legally verified answer. Taxes are to be paid on income, not on money that you handle for someone. So if the idea is only that he gets and holds the money for you until a later point in time, there should be no tax liability. If the amount is high enough to raise a flag in the bank so the IRS might look at it, and he wants to be sure to not get in trouble, he should keep it separate, and keep a record of 'handing it to you'. Note that if he makes interest on it, or uses it to pay his credit down until you come or such, the situation changes. |
Pay index fund expense ratios with cash instead of fund balance | null | The mutual fund is legally its own company that you're investing in, with its own expenses. Mutual fund expense ratios are a calculated value, not a promise that you'll pay a certain percentage on a particular day. That is to say, at the end of their fiscal year, a fund will total up how much it spent on administration and divide it by the total assets under management to calculate what the expense ratio is for that year, and publish it in the annual report. But you can't just "pay the fee" for any given year. In a "regular" account, you certainly could look at what expenses were paid for each fund by multiplying the expense ratio by your investment, and use it in some way to figure out how much additional you want to contribute to "make it whole" again. But it makes about as much sense as trying to pay the commission for buying a single stock out of one checking account while paying for the share price out of another. It may help you in some sort of mental accounting of expenses, but since it's all your money, and the expenses are all part of what you're paying to be able to invest, it's not really doing much good since money is fungible. In a retirement account with contribution limits, it still doesn't really make sense, since any contribution from outside funds to try to pay for expense ratios would be counted as contributions like any other. Again, I guess it could somehow help you account for how much money you wanted to contribute in a year, but I'm not really sure it would help you much. Some funds or brokerages do have non-expense-ratio-based fees, and in some cases you can pay for those from outside the account. And there are a couple cases where for a retirement account this lets you keep your contributions invested while paying for fees from outside funds. This may be the kind of thing that your coworker was referring to, though it's hard to tell exactly from your description. Usually it's best just to have investments with as low fees as possible regardless, since they're one of the biggest drags on returns, and I'd be very wary of any brokerage-based fees when there are very cheap and free mutual fund brokerages out there. |
Is my mother eligible for SNAP? | null | If she lives by herself, my guess would be that she qualifies as a household of one. Either way, her monthly income is below the threshold, so she should be eligible. Per the linked website The only way to determine if your household is eligible for SNAP benefits is to apply. I'd say it's worth a try. |
Should I take a personal loan for my postgraduate studies? | null | As mentioned in the comments, there are costs associated with owning & living in an apartment. First you have to pay maintenance charges on a monthly basis and perhaps also property tax. Find out the overall outgoings when you live in that apartment & add the EMI payments to the bank, it should not be way higher than your current rent. As an advantage you are getting an asset when you buy an apartment & rent is a complete loss, ast least financial terms. So, real estate is in general a good idea over paying rent. As for the loan part, personal loans are by far the most expensive of loans as they are in general unsecured loans (but do check with your bank). One way is to try and get a student loan, which should be cheaper. If you can borrow from family that is the best option, you could return the money with perhaps bank fixed deposit rates, it is better to pay family interest than bank. If none of the options are workable, then personal loan is something you need to look at with a clear goal to pay it off as soon as possible and try to take it in stages, as an when you require it and if possible avoid taking all the 15,000/- at once. |
Someone asks you to co-sign a loan. How to reject & say “no” nicely or politely? | null | I have been in this situation and I essentially went for the truthful answer. I first explained that co-signing for a loan wasn't just vouching for the person, which I certainly would do, but it was putting my name on the loan and making me the person they loan company would go after if a payment was ever missed. Then I explained that even within married couples, money can be a major source of strife and fights, it would be even worse for someone not quite as close like a family member or friend. Essentially I wouldn't want to risk my relationship with a good friend or family member over some financial matter. |
The doctor didn't charge the health insurance in time, am I liable? | null | If you read all that paperwork they made you fill out at the emergency room, there is probably something in there explicitly stating that you owe any bills you rack up regardless of what happens with the insurance company. They generally have a disclaimer that filing for you with your insurance company is a courtesy service they offer, but they are not obliged to do it. Ultimately, you are responsible for your bills even if the provider slow-billed you. Sorry. |
What are good Monthly Income Funds? [Canada] | null | @sharam - big question. I am going to answer part of it, but not as directly as you might like. You mention 4-6 cents per unit per month, but fail to give a unit price, so it is hard to tell how much return you are really looking for. Given the amount you have to invest, depending on your time horizon, you will do much better outside of mutual funds. Many funds in this category have fees in the 2% range. You actually have enough money to have a diversified portfolio on your own, without recourse to funds. If you want to use a fund-like product, I encourage you to look at well established ETFs (Exchange Traded Funds). They are basically like mutual funds that trade on the open stock market. One good example in this category is iShares XDV Good Luck |
How smart is it to really be 100% debt free? | null | Very smart. Let other people pay you interest. Don't pay other people interest. And, yes, I know it's possible to borrow money from one place and lend it to another place at a slightly higher rate, but why bother. |
Calculating Future Value: Initial deposit and recurring deposits of a fixed but different Value | null | If I is the initial deposit, P the periodic deposit, r the rent per period, n the number of periods, and F the final value, than we can combine two formulas into one to get the following answer: F = I*(1+r)n + P*[(1+r)n-1]/r In this case, you get V = 1000*(1.05)20 + 100*[(1.05)20-1]/0.05 = 5959.89 USD. Note that the actual final value may be lower because of rounding errors. |
Why is day trading considered riskier than long-term trading? | null | Short-term, the game is supply/demand and how the various participants react to it at various prices. On longer term, prices start to better reflect the fundamentals. Within something like week to some month or two, if there has not been any unique value affecting news, then interest, options, market maker(s), swing traders and such play bigger part. With intraday, the effects of available liquidity become very pronounced. The market makers have algos that try to guess what type of client they have and they prefer to give high price to large buyer and low price to small buyer. As intraday trader has spreads and commissions big part of their expenses and leverage magnifies those, instead of being able to take advantage of the lower prices, they prefer to stop out after small move against them. In practise this means that when they buy low, that low will soon be the midpoint of the day and tomorrows high etc if they are still holding on. Buy and sell are similar to long call or long put options position. And options are like insurance, they cost you. Also the longer the position is held the more likely it is to end up with someone with ability to test your margin if you're highly leveraged and constantly making your wins from the same source. Risk management is also issue. The leveraged pros trade through a company. Not sure if they're able to open another such company and still open accounts after the inevitable. |
Getting a mortgage while self-employed | null | Would it be worth legitimizing his business or is it too late at this point? To be blunt, you're asking if we recommend that he stop breaking the law. The answer is obviously yes, he should be declaring his income. And it would probably benefit him to get on the same page as his employer (or client) so they can both start obeying the law together. Once he's filed a tax return for 2016 that would certainly help his cause as far as a lender is concerned, and as soon as he can provide some recent pay stubs (or paid invoices) he should be ready to move forward on the mortgage based on that additional income. |
What are the tax implications of lending to my own LLC? | null | It'll be just like any other loan you make, on your end, and receive, on your LLC's end. You pay taxes on the interest received, and your LLC can deduct the interest paid. Do make sure you set it up properly, however: If you want to loan money to your business, you should have your attorney draw up paperwork to define the terms of the loan, including repayment and consequences for non-repayment of the loan. It should be clear that the loan is a binding obligation on the part of the company. As a recent Tax Court case notes, the absence of such paperwork negates the loan. For tax purposes, the loan is an "arms length" transaction, being treated like any other debt. From: http://biztaxlaw.about.com/od/financingyourstartup/f/investinbusiness.htm |
Subsets and Splits
No community queries yet
The top public SQL queries from the community will appear here once available.