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Why the need for human brokers while there are computers?
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There are still human brokers on the floor primarily due to tradition. Their numbers have certainly dwindled, however, and it's reasonable to expect the number of floor traders to decrease even more as electronic trading continues to grow. A key reason for human brokers, however, is due to privacy. Certain private exchanges such as dark pools maintain privacy for high profile clients and institutional investors, and human brokers are needed to execute anonymous deals in these venues. Even in this region, however, technology is supplanting the need for brokers. I don't believe there is any human-broker-free stock exchange, but Nasdaq and other traditionally OTC (over the counter) exchanges are as close as it gets since they never even had trading floors.
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Why is the price of my investment only updated once per day?
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There is no fundamental, good reason, I think; "that's just how it's done" (which is what all the other answers seem to be saying, w/o coming out and admitting it). Just guessing, but I'll bet most of the reason is historical: Before up-to-the-moment quotes were readily available, that was a bit tedious to calculate/update the fund's value, so enacted-laws let it be done just once per day. (@NL7 quotes the security act of 1940, which certainly has been updated, but also still might contain the results of crufty rationales, like this.) There are genuinely different issues between funds and stocks, though: One share of a fund is fundamentally different from one share of stock: There is a finite supply of Company-X-stock, and people are trading that piece of ownership around, and barter to find an mutually-agreeable-price. But when you buy into a mutual-fund, the mutual-fund "suddenly has more shares" -- it takes your money and uses it to buy shares of the underlying stocks (in a ratio equal to its current holdings). As a consequence: the mutual fund's price isn't determined by two people bartering and agreeing on a price (like stock); there is exactly one sane way to price a mutual fund, and that's the weighted total of its underlying stock. If you wanted to sell your ownership-of-Mutual-Fund-Z to a friend at 2:34pm, there wouldn't be any bartering, you'd just calculate the value based on the stated-value of the underlying stock at that exact moment. So: there's no inherent reason you can't instantaneously price a mutual fund. BUT people don't really buy/sell funds to each other -- they go to the fund-manager and essentially make a deposit-or-withdraw. The fund-manager is only required by law to do it once a day (and perhaps even forbidden from doing it more often?), so that's all they do. [Disclaimer: I know very little about markets and finance. But I recognize answers that are 'just because'.]
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How did my number of shares get reduced?
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How can they reduce the number of shares I hold? They may have purchased them. You don't say what stock it is, so we can only speculate. Let's say that the stock is called PENNY. So they may have taken your 1600 PENNY shares and renamed them to 1600 PENNYOLD shares. Then they created a new $5 PENNY share and gave you .2357 shares of that in exchange for your 1600 PENNYOLD shares. This suggests that your old shares were worth $1.1785 or less than a tenth of a cent each. As an example, MYLAN did this in 2015 as part of their tax inversion (moved official headquarters from the US to Europe). They did not change the number of shares at that time, but MYLAN is not a penny stock. This is the kind of thing that might happen in a bankruptcy. A reverse split (where they give you one share in exchange for more than one share) is also possible, although you received an odd amount for a reverse split. Usually those produce rounder numbers. A number like .2357 sounds more like a market price, as those can be bizarre.
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Wife sent to collections for ticket she paid ten years ago
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The first thing you should do is write a letter to the collection company telling them that you dispute all charges and demand, per section 809 of the Fair Debt Collection Practices Act, that they immediately validate and confirm any and all debts they allege you owe. You should further request that that they only communicate with you by mail. Section 809 requires them to examine the legal documents showing you allegedly owe a debt and they are required to send this to you. This all creates a useful paper trail. When you send the letter, be sure to send it as certified mail with a return receipt. From your description, it doesn't sound like this will do anything, but it's important you do it within 30 days of them contacting you. This is because the law allows them to assume the debt is valid if you don't do it within 30 days of their initial contact. I recommend you speak with an attorney. Most states have a statute of limitation on debt of about 4 or 5 years. I don't know if that applies to courts though. Whatever you do, be very careful of the language you use when speaking with them. Always refer to it as "the alleged debt," or "the debt you allege I owe." You don't want them misconstruing your words later on. As far as proving you paid it, I would look through every scrap of paper I'd ever touched looking for it. If that proves fruitless, try going to the courthouse and looking through their records. If they're saying you didn't pay, that's a long shot, but still worth a try. You could also try bank records from that time, like if you have a Visa statement showing $276.17 paid to the Nevada Court or something like that. If all else fails, the law allows you to send the collector a letter saying that you refuse to pay the debt. The collection company then legally must stop contacting you unless it's to tell you they are suing you or to tell you they won't contact you again. I strongly advise against this though. Your best bet is going to be speaking with a qualified attorney. Edit: You should also pull your credit reports to make sure this isn't being reported there. Federal law gives you the right to have a free copy of each of your credit reports once every year. If it is being reported, send a certified letter with return receipt to each bureau which is reporting it telling them you dispute the information. They then are required to confirm the information. If they can't confirm it, they must remove it. If they do confirm it, you are legally entitled to put a statement disputing the information next to it on your credit report. I am not an attorney. This is not legal advise. You should consult an attorney who is licensed to practice law in your particular jurisdiction.
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Are stores that offer military discounts compensated by the government?
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This story is about military grocery stores - i.e.: grocery stores for military personnel on military bases. There are no discounts for military personnel in a regular grocery store. But they may have subsidised prices in grocery stores located inside a military installation, and these are those stores that the story is talking about.
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How does the value of an asset (valued in two different currencies) change when the exchange rate changes?
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Gold is traded on the London stock exchange (LSE) and the New York stock exchange (NYSE) under various separate asset tickers, mainly denominated in sterling and US dollars respectively. These stocks will reflect FX changes very quickly. If you sold LSE gold and foreign exchanged your sterling to dollars to buy NYSE gold you would almost certainly lose on the spreads upon selling, FX'ing and re-buying. In short, the same asset doesn't exist in multiple currencies. It may have the same International Securities Identification Number (ISIN), but it can trade with different Stock Exchange Daily Official List (SEDOL) identifiers, reflecting different currencies and/or exchanges, each carrying a different price at any one time.
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What are the alternatives to compound interest for a Muslim?
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It depends whether you want to be technically compliant with the letter of the law or compliant with the underlying meaning. For instance, in some countries you can find shell companies that do nothing but deal in fixed income instruments (those that you want to avoid) and dividend stocks (those that you might or might not be allowed to use). You can buy stock of that shell company, which does not hand out dividends itself. Thereby, you transform interest and dividends into capital gains. These shell companies exist for fiscal reasons, the more risky capital gains are often less taxed than interest or dividends. This might technically solve your problem, but not really change anything in the underlying reality. P.S. Don't worry too much about missing compounding interest. The rates are incredibly low right now.
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Credit card statement dates follow pattern?
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Each bank is different. Usually in my experience for newer credit card accounts, there is a specific number of days in a billing cycle (something like 28) and then a 20-25 day grace period. Older accounts usually have 30+ day billing cycles. Back in the 90's, many cards also had 30-40 day grace periods. The language specific to your card is in the card agreement.
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PayPal wants me to “add a bank account”, another funding source. Credit card isn't working. Why?
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I've used PayPal for my business for a long time. Sometimes PayPal doesn't trust credit cards. Debit or direct bank transfer are reliable. There is also a charge for using a credit card but I don't think that is the reason. You may be trying to purchase a high value item. That would be a possible reason why PayPal allowed you to use credit cards in the past, but will not allow you to do so now, for these particular transactions.
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Does it make any sense to directly contribute to reducing the US national debt?
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At its heart, I think the best spirit of "donation" is helping others less fortunate than yourself. But as long as the US remains solvent, the chief benefit of paying down the national debt is - like paying off a credit card - lowering the future interest payments the U.S. taxpayer has to make. Since the wealthy pay a disproportionately large portion of taxes (per capita), your hard earned money would be disproportionately benefitting the wealthy. So I'd recommend you do one or both of the following: instead target your donations to a charity whose average beneficiary is less fortunate than yourself take political action with an aim towards balancing the federal budget (since the US national debt is principally financed in the form of 30 year treasuries, the U.S. will be completely out of debt if it can maintain a balanced budget for 30 years recanted, see below)
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Making an offer on a property - go in at market price?
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From then on we've felt he was really pushy and rushing us to make a decision (we need to lock in a good rate, its a sellers market, it'll go fast, snooze loose, etc). This is the first reason for walking away. I understand that all those factors might be true but my question is: How do I know we made a good offer? I'm going to be blunt, here: You don't. You work out ahead of time what you will pay (ignore the agent) and you make the offer on the basis of your own research, research you spent months undertaking. The listed price on the location is $375,000 and according to our agent similar units over the last few years had sold for that amount. So our agent suggested making an offer at market price. According to the agent. I'm going to be blunt here, what do any of the real estate sites out there - that offer a wealth of information for free - indicate? If you don't know, then yet again you don't know if you made the right offer or not. Do some research now by yourself. I would be shocked if your offer was at the right level. Set your emotions aside - there are a gazillion houses out there.
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If I short-sell a dividend-paying stock, do I have to pay the dividend?
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Well, if the short seller has to pay the dividend out of their pocket, what happens to the dividend the company paid out ?? Sounds like there are 2 divdends floating around, the short's, and the company's, but only 1 share of stock.
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What is an effective way to convert large sums of US based investments to foreign currencies?
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A stock, bond or ETF is basically a commodity. Where you bought it does not really matter, and it has a value in USD only inasmuch as there is a current market price quoted at an American exchange. But nothing prevents you from turning around and selling it on a European exchange where it is also listed for an equivalent amount of EUR (arbitrage activities of investment banks ensure that the price will be equivalent in regard to the current exchange rate). In fact, this can be used as a cheap form of currency conversion. For blue chips at least this is trivial; exotic securities might not be listed in Europe. All you need is a broker who allows you to trade on European exchanges and hold an account denominated in EUR. If necessary, transfer your securities to a broker who does, which should not cost more than a nominal fee. Mutual funds are a different beast though; it might be possible to sell shares on an exchange anyway, or sell them back to the issuer for EUR. It depends. In any case, however, transferring 7 figure sums internationally can trigger all kinds of tax events and money laundering investigations. You really need to hire a financial advisor who has international investment experience for this kind of thing, not ask a web forum!
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Is real (physical) money traded during online trading?
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I think you need to define what you mean by "buy currency online using some online forex trading platform" ... In large Fx trades, real money [you mean actual electronic money, as there is not paper that travels these days]... The Fx market is quite wide with all kinds of trades. There are quite a few Fx transactions that are meant for delivery. You have to pay in the currency for full amount and you get the funds electronicall credited to you in other currency [ofcouse you have an account in the other currency or you have an obligation to pay]. This type of transaction is valid in Ismalic Banking. The practise of derivaties based on this or forward contracts on this is not allowed.
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Lifetime ISA: What are the chances of a reputable Bank offering it?
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The Skipton Building Society has recently announced that it is offering a cash LISA. According to the papers it is the first to offer a cash LISA. Skipton is the UK's 4th largest UK Building Society and has been in existence since 1853. There are other providers of LISAs such as Hargreaves Landsdown. Hargreaves Lansdown is listed on the FTSE 100 i.e. it's one of the largest 100 companies with a UK stock market listing. Stocks and Shares and Cash LISAs are quite different so you need to decide which type you want before deciding where you want to get one from. You can switch from one to another at a later date if you so wish but you may need to switch providers to do so.
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UK: Personal finance book for a twenty-something
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I will definitely recommend the following books The above books will open lot of eyes to exactly know what you are doing with your personal finances in a day to day basis.These books will surely be in the top of my list which I will be giving away to my kins in my later stage. The concepts are universally the same, feel free to skip the chapters which were US based. I live in UK and I read most of the above books in late twenties, it surely made lot of changes and also drastically improved my personal finance acumen. I wish I have read these books in my early twenties.
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Is there a generally accepted term for fractions of Currency Units?
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I recently bought a stock - which was priced exactly as your question ponders, to the 1/100 cent. I happened to buy 2000 shares, but just a round lot of 100 would be enough to create no need for rounding. It's common for industry to price this way as well, where an electronic component purchased by the thousands, is priced to the tenth or hundredth of a cent. There's nothing magic about this, and you'll have more to ponder when your own lowest unit of currency is no longer minted. (I see you are in UK. Here, in the US, there's talk of dropping our cent. A 5 cent piece to be the smallest value coin. Yet, any non-cash transactions, such as checks, credit card purchases, etc, will still price to the penny.) To specifically answer the question - it's called decimal currency. 1/10, 1/100 of a cent.
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Does this plan make any sense for early 20s investments?
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I would wait, and invest that money in a Roth IRA. Because taxes are paid on the contributions to a Roth IRA, you can withdraw the contributions at any time, tax and penalty-free. In addition, you can withdraw contributions and earning to purchase your first home.
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What is the difference between a stock and a bond?
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A stock is an ownership interest in a company. There can be multiple classes of shares, but to simplify, assuming only one class of shares, a company issues some number of shares, let's say 1,000,000 shares and you can buy shares of the company. If you own 1,000 shares in this example, you would own one one-thousandth of the company. Public companies have their shares traded on the open market and the price varies as demand for the stock comes and goes relative to people willing to sell their shares. You typically buy stock in a company because you believe the company is going to prosper into the future and thus the value of its stock should rise in the open market. A bond is an indebted interest in a company. A company issues bonds to borrow money at an interest rate specified in the bond issuance and makes periodic payments of principal and interest. You buy bonds in a company to lend the company money at an interest rate specified in the bond because you believe the company will be able to repay the debt per the terms of the bond. The value of a bond as traded on the open exchange varies as the prevailing interest rates vary. If you buy a bond for $1,000 yielding 5% interest and interest rates go up to 10%, the value of your bond in the open market goes down so that the payment terms of 5% on $1,000 matches hypothetical terms of 10% on a lesser principal amount. Whatever lesser principal amount at the new rate would lead to the same payment terms determines the new market value. Alternatively, if interest rates go down, the current value of your bond increases on the open market to make it appear as if it is yielding a lower rate. Regardless of the market value, the company continues to pay interest on the original debt per its terms, so you can always hold onto a bond and get the original promised interest as long as the company does not go bankrupt. So in summary, bonds tend to be a safer investment that offers less potential return. However, this is not always the case, since if interest rates skyrocket, your bond's value will plummet, although you could just hold onto them and get the low rate originally promised.
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Investing $50k + Real Estate
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I would say that, for the most part, money should not be invested in the stock market or real estate. Mostly this money should be kept in savings: I feel like your emergency fund is light. You do not indicate what your expenses are per month, but unless you can live off of 1K/month, that is pretty low. I would bump that to about 15K, but that really depends upon your expenses. You may want to go higher when you consider your real estate investments. What happens if a water heater needs replacement? (41K left) EDIT: As stated you could reduce your expenses, in an emergency, to 2K. At the bare minimum your emergency fund should be 12K. I'd still be likely to have more as you don't have any money in sinking funds or designated savings and the real estate leaves you a bit exposed. In your shoes, I'd have 12K as a general emergency fund. Another 5K in a car fund (I don't mind driving a 5,000 car), 5k in a real estate/home repair fund, and save about 400 per month for yearly insurance and tax costs. Your first point is incorrect, you do have debt in the form of a car lease. That car needs to be replaced, and you might want to upgrade the other car. How much? Perhaps spend 12K on each and sell the existing car for 2K? (19K left). Congratulations on attempting to bootstrap a software company. What kind of cash do you anticipate needing? How about keeping 10K designated for that? (9K left) Assuming that medical school will run you about 50K per year for 4 years how do you propose to pay for it? Assuming that you put away 4K per month for 24 months and have 9K, you will come up about 95K short assuming some interests in your favor. The time frame is too short to invest it, so you are stuck with crappy bank rates.
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What are the tax liabilities or impact for selling gold?
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For reporting purposes, I would treat the purchase and sale of gold like a purchase and sale of a stock. The place to do so is Schedule D. (And if it's the wrong form, but you reported it, there is might not be a penalty, whereas there is a penalty for NOT reporting.) The long term gain would be at capital gains rates. The short term gain would be at ordinary income rates. And if you have two coins bought at two different times, you get to choose which one to report (as long as you report the OTHER one when you sell the second coin).
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In the stock market, why is the “open” price value never the same as previous day's “close”?
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Quoted from money.howstuffworks.com: NASDAQ has come up with an auction approach called the opening cross. Here's how it works. In the morning, a computer program looks at all the orders that have come in overnight in each different stock. Based on those orders, the program picks a price level that would be the best opening price. However, it also looks to see if there's a trade imbalance. For example, if a company announced bad news after the market closed, there might be 10 times more sell orders than buy orders. NASDAQ then broadcasts the price and imbalance information to its network of dealers with the goal of offsetting the imbalance. It then lets dealers place orders. This all happens very quickly, in a time window of two minutes or so, right before the market opens. Dealers can place orders, and those orders are factored into the opening price. Further reading here: Opening Price calculation
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For a car loan, how much should I get preapproved for?
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—they will pull your credit report and perform a "hard inquiry" on your file. This means the inquiry will be noted in your credit report and count against you, slightly. This is perfectly normal. Just don't apply too many times too soon or it can begin to add up. They will want proof of your income by asking for recent pay stubs. With this information, your income and your credit profile, they will determine the maximum amount of credit they will lend you and at what interest rate. The better your credit profile, the more money they can lend and the lower the rate. —that you want financed (the price of the car minus your down payment) that is the amount you can apply for and in that case the only factors they will determine are 1) whether or not you will be approved and 2) at what interest rate you will be approved. While interest rates generally follow the direction of the prime rate as dictated by the federal reserve, there are market fluctuations and variances from one lending institution to the next. Further, different institutions will have different criteria in terms of the amount of credit they deem you worthy of. —you know the price of the car. Now determine how much you want to put down and take the difference to a bank or credit union. Or, work directly with the dealer. Dealers often give special deals if you finance through them. A common scenario is: 1) A person goes to the car dealer 2) test drives 3) negotiates the purchase price 4) the salesman works the numbers to determine your monthly payment through their own bank. Pay attention during that last process. This is also where they can gain leverage in the deal and make money through the interest rate by offering longer loan terms to maximize their returns on your loan. It's not necessarily a bad thing, it's just how they have to make their money in the deal. It's good to know so you can form your own analysis of the deal and make sure they don't completely bankrupt you. —is that you can comfortable afford your monthly payment. The car dealers don't really know how much you can afford. They will try to determine to the best they can but only you really know. Don't take more than you can afford. be conservative about it. For example: Think you can only afford $300 a month? Budget it even lower and make yourself only afford $225 a month.
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Are social media accounts (e.g. YouTube, Twitter, Instagram, etc.) considered assets?
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Assets with zero value, perhaps. Unless you can prove that they have resale value. Good luck with that. In other words, not worth spending time on.
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Why haven't there been personal finance apps or softwares that use regression modeling or A.I.?
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How would they make money from it? They sell you the software for $100 (US example; could as easily be 100 Euros or 10,000 Japanese Yen). You use it to make recommendations on your blog. Your blog becomes rich from advertising. They sold $100 worth of software. If they spent $1 million in labor developing it, they're way behind. Another problem is that the software would stop working and need adjusted periodically. This is easy to do on a server but annoying on a PC. And who pays for the adjustments? Put both those things together, and it's a lot easier to do on a server. Another advantage is that a server can get a better data feed as well. Pay a premium for the detailed information rather than relying on public sources. And people are used to renting server access where they expect to buy software once. Another issue is that they are unlikely to beat the market this way. Yes, AIs have done so. But that's the latest AI, constantly adjusted. This is going to be a previous generation AI. It's more likely to match the market. And we already have a way to match the market: an index fund. If someone had a brilliant AI, the best use would probably be to sell it to a fund manager. The fund manager could then use the AI to find opportunities for its existing investors. Note that a $10 billion fund with a 10% return that gives a .1% commission would be paying $1 million. And that has no marketing or packaging overhead. Think $10 billion is a lot? Fidelity has $2 trillion.
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Can anyone else make an online payment for me?
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Your relative in the US could buy a pre-paid Visa (aka Visa gift card) and give you the numbers on that to pay. They're available for purchase at many grocery/convenience stores. In most (all??) cases there'll be a fee of a several dollars charged in addition to the face value of the card. The biggest headache I can think of would be that pre-paid cards are generally only available in $25/50/100 increments; unless the current SAT price matches one of the standard increments they'll have to buy the next card size up and then get the remaining money off it in a separate transaction. A grocery store would be one of the easier places for your relative to do this because cashiers there are used to splitting transactions across multiple payment sources (something not true at most other types of business) due to regularly processing transactions partially paid for via welfare benefits.
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Calculating theoretical Present Value
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The example from the following website: Investopedia - Calculating The Present And Future Value Of Annuities specifically the section 'Calculating the Present Value of an Annuity Due' shows how the calculation is made. Using their figures, if five payments of $1000 are made over five years and depreciation (inflation) is 5%, the present value is $4545.95 There is also a formula for this summation, (ref. finance formulas)
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Long term investment for money
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What explains the most of the future returns of a portfolio is the allocation between asset classes. In the long term, stock investments are almost certain to return more than any other kinds of investments. For 40+ years, I would choose a portfolio of 100% stocks. How to construct the portfolio, then? Diversification is the key. You should diversify in time (don't put a large sum of money into your stock portfolio immediately; if you have a large sum to invest, spread it around several years). You should diversify based on company size (invest in both large and small companies). You should also diversify internationally (don't invest in just US companies). If you prefer to pick individual stocks, 20 very carefully selected stocks may provide enough diversification if you keep diversification in mind during stock picking. However, careful stock picking cannot be expected to yield excess returns, and if you pick stocks manually, you need to rebalance your portfolio occasionally. Thus, if you're lazy, I would recommend a mutual fund, or many mutual funds if you have difficulty finding a low-cost one that is internationally diversified. The most important consideration is the cost. You cannot expect careful fund selection to yield excess returns before expenses. However, the expenses are certain costs, so prefer low-cost funds. Almost always this means picking index funds. Avoid funds that have a small number of stocks, because they typically invest only in the largest companies, which means you fail to get diversification in company size. So, instead of Euro STOXX 50, select STOXX 600 when investing to the European market. ETFs may have lower costs than traditional mutual funds, so keep ETFs in mind when selecting the mutual funds in which to invest. For international diversification, do not forget emerging markets. It is not excessive to invest e.g. 20% to emerging markets. Emerging markets have a higher risk but they also have a higher return. A portfolio that does not include emerging markets is not in my opinion well diversified. When getting close to retirement age, I would consider increasing the percentage of bonds in the portfolio. This should be done primarily by putting additional money to bonds instead of selling existing investments to avoid additional taxes (not sure if this applies to other taxation systems than the Finnish one). Bond investments are best made though low-cost mutual funds as well. Keep bond investments in your local currency and risk-free assets (i.e. select US government bonds). Whatever you do, remember that historical return is no guarantee of future return. Actually, the opposite may be true: there is a mean reversion law. If a particular investment has returned well in the past, it often means its price has gone up, making it more likely that the price goes down in the future. So don't select a fund based on its historical return; instead, select a fund based on low costs. However, I'm 99% certain that over a period of 40 years, stocks will return better than other investments. In addition to fund costs, taxes are the other certain thing that will be deducted from your returns. Research what options you have to reduce the taxes you need to pay. 401-K was explained in another answer; this may be a good option. Some things recommended in other answers that I would avoid:
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Do I need multiple credit monitoring services?
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Good question given what happened with Equifax You could avoid paying extra to Experian for monitoring all three, if you are getting free monitoring from Equifax(Only if Experian charges less for monitoring their own vs monitoring all three). If you do cancel monitor all three then the only one you would not be monitoring is Trans Union, but you should be fine as most finance companies report to at least two credit unions. But if you want to be 100% sure then monitor all three. But I would regard that as an overkill(personal opinion)
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When is the right time to buy a car and/or a house?
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My recommendation is to pay off your student loans as quickly as possible. It sounds like you're already doing this but don't incur any other large debts until you have this taken care of. I'd also recommend not buying a car, especially an expensive one, on credit or lease either. Back during the dotcom boom I and many friends bought or leased expensive cars only to lose them or struggle paying for them when the bottom dropped out. A car instantly depreciates and it's quite rare for them to ever gain value again. Stick with reliable, older, used cars that you can purchase for cash. If you do borrow for a car, shop around for the best deal and avoid 3+ year terms if at all possible. Don't lease unless you have a business structure where this might create a clear financial advantage. Avoid credit cards as much as possible although if you do plan to buy a house with a mortgage you'll need to maintain some credit history. If you have the discipline to keep your balance small and paid down you can use a credit card to build credit history. However, these things can quickly get out of hand and you'll wonder why you suddenly owe $10K, $20K or even more on them so be very careful with them. As for the house (speaking of US markets here), save up for at least a 20% down payment if you can. Based on what you said, this would be about $20-25K. This will give you a lot more flexibility to take advantage of deals that might come your way, even if you don't put it all into the house. "Stretching" to buy a house that's too expensive can quickly lead to financial ruin. As for house size, I recommend purchasing a 4 bedroom house even if you aren't planning on kids right away. It will resell better and you'll appreciate having the extra space for storage, home office, hobbies, etc. Also, life has a way of changing your plans for having kids and such.
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Should I buy stocks of my current employer because of its high dividend yield?
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Generally, it is considered a bad idea to put significant parts of your money in your own employer's stock, no matter how great the company looks right now. The reason is the old 'don't put all your eggs in one basket'. If there is ever a serious issue with your company, and you lose your job because they go down the drain, you don't only lose your job, but also your savings (and potentially 401k if you have their stock there too). So you end unemployed and without all your savings. Of course, this is a generic tip, and depending on the situation, it might be ok to ignore it, that's your decision. Just remember to have an eye on it, so you can get out while they are still floating - typically employees are not the first to know when it goes downhill, and when you see it in the papers, it's too late. Typically, you get a more secure and independent return-on-invest by buying into a well-managed mixed portfolio
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I'm a UK citizen, can I use US stockbrokers?
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The UK has historically aggressive financial law, inherited from Dutch friendship, influence, and acquisitions by conquest. The law is so open that nearly anyone can invest through the UK without much difficulty, and citizens have nearly no restrictions on where to invest. A UK citizen can either open an account in the US with paperwork hassles or at home with access to all world markets and less paperwork. Here is the UK version of my broker, Interactive Brokers. Their costs are the lowest, but you will be charged a minimum fee if you do not trade enough, and their minimum opening balance can be prohibitively high for some. If you do buy US products, be sure to file your W-8BEN.
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Is this investment opportunity problematic?
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it seems you have 3 concerns:
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Are my parents ripping me off with this deal that doesn't allow me to build my equity in my home?
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You're paying 5.2% 'interest' on the $115K (500 * 12 / 115,000) * 100 but the amount you pay back is not $115K but 75% of the property value at sale. Is that right? A mortgage would have cost about half that rate and the balloon payment would have been fixed - you would pay back $115K at maturity plus you could have sold it whenever you liked As Gnasher729 said, if you consider it to be rent then the situation looks different but the point of buying a house is to avoid paying 'useless' rent, build equity and hopefully make a capital gain I'd speak to a lawyer & possibly an accountant (regarding the numbers)
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What are some tips for getting the upper hand in car price negotiations?
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I read a really good tract that my credit union gave me years ago written by a former car salesman about negotiation tactics with car dealers. Wish I could find it again, but I remember a few of the main points. 1) Never negotiate based on the monthly payment amount. Car salesmen love to get you into thinking about the monthly loan payment and often start out by asking what you can afford for a payment. They know that they can essentially charge you whatever they want for the car and make the payments hit your budget by tweaking the loan terms (length, down payment, etc.) 2) (New cars only) Don't negotiate on the price directly. It is extremely hard to compare prices between dealerships because it is very hard to find exactly the same combination of options. Instead negotiate the markup amount over dealer invoice. 3) Negotiate one thing at a time A favorite shell game of car dealers is to get you to negotiate the car price, trade-in price, and financing all at one time. Unless you are a rain-man mathematical genius, don't do it. Doing this makes it easy for them to make concessions on one thing and take them right back somewhere else. (Minus $500 on the new car, plus $200 through an extra half point on financing, etc). 4) Handling the Trade-In 5) 99.9999% of the time the "I forgot to mention" extra items are a ripoff They make huge bonuses for selling this extremely overpriced junk you don't need. 6) Scrutinize everything on the sticker price I've seen car dealers have the balls to add a line item for "Marketing Costs" at around $500, then claim with a straight face that unlike OTHER dealers they are just being upfront about their expenses instead of hiding them in the price of the car. Pure bunk. If you negotiate based on an offset from the invoice instead of sticker price it helps you avoid all this nonsense since the manufacturer most assuredly did not include "Marketing costs" on the dealer invoice. 7) Call Around before closing the deal Car dealers can be a little cranky about this, but they often have an "Internet sales person" assigned to handle this type of deal. Once you know what you want, but before you buy, get the model number and all the codes for the options then call 2-3 dealers and try to get a quote over the phone or e-mail on that exact car. Again, get the quote in terms of markup from dealer invoice price, not sticker price. Going through the Internet sales guy doesn't at all mean you have to buy on the Internet, I still suggest going down to the dealership with the best price and test driving the car in person. The Internet guy is just a sales guy like all the rest of them and will be happy to meet with you and talk through the deal in-person. Update: After recently going through this process again and talking to a bunch of dealers, I have a few things to add: 7a) The price posted on the Internet is often the dealer's bottom line number. Because of sites like AutoTrader and other car marketplaces that let you shop the car across dealerships, they have a lot of incentive to put their rock-bottom prices online where they know people aggressively comparison shop. 7b) Get the price of the car using the stock number from multiple sources (Autotrader, dealer web site, eBay Motors, etc.) and find the lowest price advertised. Then either print or take a screenshot of that price. Dealers sometimes change their prices (up or down) between the time you see it online and when you get to the dealership. I just bought a car where the price went up $1,000 overnight. The sales guy brought up the website and tried to convince me that I was confused. I just pulled up the screenshot on my iPhone and he stopped arguing. I'm not certain, but I got the feeling that there is some kind of bait-switch law that says if you can prove they posted a price they have to honor it. In at least two dealerships they got very contrite and backed away slowly from their bargaining position when I offered proof that they had posted the car at a lower price. 8) The sales guy has ultimate authority on the deal and doesn't need approval Inevitably they will leave the room to "run the deal by my boss/financing guy/mom" This is just a game and negotiating trick to serve two purposes: - To keep you in the dealership longer not shopping at competitors. - So they can good-cop/bad-cop you in the negotiations on price. That is, insult your offer without making you upset at the guy in front of you. - To make it harder for you to walk out of the negotiation and compromise more readily. Let me clarify that last point. They are using a psychological sales trick to make you feel like an ass for wasting the guy's time if you walk out on the deal after sitting in his office all afternoon, especially since he gave you free coffee and sodas. Also, if you have personally invested a lot of time in the deal so far, it makes you feel like you wasted your own time if you don't cross the goal line. As soon as one side of a negotiation forfeits the option to walk away from the deal, the power shifts significantly to the other side. Bottom line: Don't feel guilty about walking out if you can't get the deal you want. Remember, the sales guy is the one that dragged this thing out by playing hide-and-seek with you all day. He wasted your time, not the reverse.
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Financing with two mortgages: a thing of the past?
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Depends on where we are in the credit cycle. When banks are scared like in 07 to 11, good luck. Now (13), they'll probably start begging you. There are more regulations that prevent it now, but they'll probably be eased as they usually are during good times. If the banks won't help you, private investors might. Just find your local mortgage investor club.
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Will capital gains affect my tax bracket?
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I'm not sure where you are, but in the United States capital gains are taxed at a lower rate than other types of income. On the 1040, captial gains income is separated from earned income, and income tax is calculated just on earned income. Then capital gains tax is calculated on capital gains income, and then added to income tax afterward.
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When can we exercice an option?
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If you're talking about ADBE options, that is an American style option, which can be exercised at any time before expiration. You can exercise your options by calling your broker and instructing them to exercise. Your broker will charge you a nominal fee to do so. As an aside, you probably don't want to exercise the option right now. It still has a lot of time value left, which you'll lose if you exercise. Just sell the option if you don't think ADBE will keep going up.
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Is 6% too high to trade stocks on margin?
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Yes, 6% is a waste of money, because some other brokers such as IB offer margin rates below 2%. Also, to borrow money for even less than any broker's margin interest rate, one can do an EFP transaction. This involves simultaneously shorting a stock and buying the SSF for the same stock. When the futures contract expires, you take delivery of the underlying stock to automatically close out your short position. Until then, you've effectively borrowed cash for the cost of borrowing the stock, which is typically less than 0.5% interest for widely traded ones. You also pay for the slight difference in price between the stock and the future, which is typically equivalent to another 0.5% interest or less. The total often comes to less than 1% interest. The only risk with this transaction is that the stock could become hard to borrow at some point, so then you would have to pay higher interest on it temporarily or maybe even have to close out your short early. But it is extremely rare for large, high-volume stocks to become hard-to-borrow. The borrowing cost of SPY has spiked above 5% on only a handful of days in the last decade.
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How should I deal with my long term gain this year?
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Long term capital gains are taxed at 15% this year, so the most you stand to save is $150. I wouldn't sell anything at a loss just to offset that, unless you planned on selling anyways. A few reasons: The Long term capital gains rate will go up to 20% next year, so your losses will be "worth more" next year than this year. Short term capital gains rates will go up next year as well, so again, better off saving your losses for next year. You must use capital losses to offset capital gains if you have them, but if you don't have any capital gains, you can use capital losses to offset ordinary income (up to a limit - $3,000 a year IIRC). So, if you just bite the bullet and pay the 15% on your gains this year, you could use your losses to offset your (likely higher rate) ordinary income next year. FYI, complete chart for capital gains tax rates is here. I also posted another answer about capital gains to this question a while back that might be useful.
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Why is a stock that pays a dividend preferrable to one that doesn't?
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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.
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Why is being “upside down” on a mortgage so bad?
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For most people "home ownership" is a long term lifestyle strategy (i.e. the intention is to own a home for several decades, regardless of how many times one particular house might be "swapped" for a different one. In an economic environment with steady monetary inflation, taking out a long-term loan backed by a tangible non-depreciating "permanent" asset (e.g. real estate) is in practice a form of investing not borrowing, because over time the monetary value of the asset will increase in line with inflation, but the size of the loan remains constant in money terms. That strategy was always at risk in the short term because of temporary falls in house prices, but long-term inflation running at say 5% per year would cancel out even a 20% fall in house prices in 4 years. Downturns in the economy were often correlated with rises in the inflation rate, which fixed the short-term problem even faster. Car and student loans are an essentially different financial proposition, because you know from the start that the asset will not retain its value (unless you are "investing in a vintage car" rather than "buying a means of personal transportation", a new car will lose most of its monetary value within say 5 years) or there is no tangible asset at all (e.g. taking out a student loan, paying for a vacation trip by credit card, etc). The "scariness" over home loans was the widespread realization that the rules of the game had been changed permanently, by the combination of an economic downturn plus national (or even international) financial policies designed to enforce low inflation rates - with the consequence that "being underwater" had been changed from a short term problem to a long-term one.
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What is the rationale behind stock markets retreating due to S&P having a negative outlook on the USA?
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Many of the major indices retreated today because of this news. Why? How do the rising budget deficits and debt relate to the stock markets? It does seem strange that there is a correlation between government debt and the stock market. But I could see many reasons for the reaction. The downgrade by S&P may make it more expensive for the government to borrow money (i.e. higher interest rates). This means it becomes more expensive for the government to borrow money and the government will probably need to raise taxes to cover the cost of borrowing. Rising taxes are not good for business. Also, many banks in the US hold US government debt. Rising yields will push down the value of their holdings which in turn will reduce the value of US debt on the businesses' balance sheets. This weakens the banks' balance sheets. They may even start to unload US bonds. Why is there such a large emphasis on the S&P rating? I don't know. I think they have proven they are practically useless. That's just my opinion. Many, though, still think they are a credible ratings agency. What happens when the debt ceiling is reached? Theoretically the government has to stop borrowing money once the debt ceiling is reached. If this occurs and the government does not raise the debt ceiling then the government faces three choices:
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How to understand adding or removing “liquidity” in stock markets with market/non-market orders?
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Not all limit orders add liquidity, but all market orders remove liquidity presuming there is liquidity to remove. A liquidity providing order is one that is posted to the limit book. If an order, even a limit order, is filled before being posted to the limit book, it removes liquidity. Liquidity is measured by a balance and abundance of quantities posted on the limit book and the best spread between the lowest ask and the highest bid.
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Main source of the shares/stocks data on the web
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The main source is a direct feed from the stock market itself. The faster the feed, the more expensive. 15-minute delay is essentially free... and for those of us who do long-term investment is more than adequate. If you want data sooner, sign up with a brokerage that provides that service as part of what you're paying them for... and remember that every bit you spend on services is that much more profit you have to make just to break even, so there's a real tradeoff.
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When trading put options, is your total risk decreased if you are in a position to exercise the option?
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You should also consider what the cost of the Put is, especially if the strike price is set at the current price, vs the average price delta of the security during the period between when you buy the put, and the expiration date. Also note the prices for puts on stocks with a lot of price volatility. There are a good number of situations where you may come out behind. If the stock stays the same price, you are out the premium you paid for the put. If the stock price rises less than the premium, you are out the difference between the two. If the stock price falls less than the premium, you are out the difference between the two. In order to be 'in the money' when writing a protective put, the stock has to either rise more than the premium you paid for the put (and you MUST sell, or hold and write off the expense of the put) or the stock price has to fall below the strike price to a level lower than the premium you paid, and you must SELL via the exercising the option. and you've protected yourself from a loss (presuming you were going to sell and not hold and see if the stock recovers. And since selling is required in both cases, if you've held the stock less than a year, then pay on any profits at short term rates (taxed as regular income) and if the price went down, you can't claim any loss (unless strike price was below your buy price), and would still need to pay if you had a net gain, and you likely can't deduct the price you paid for the put.
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How to find out if a company is legit?
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It depends greatly from place to place, but nothing beats the Internet reviews' research. If you can't find anything digging slightly deeper than the impressive home page, then you probably should be worried. As it seems that you are. Specifically, I do these: @JohnFX mentions a valid point: check for physical presence. Check that the office address is a real office and not a PO box or residential; call the number and see who answers it (if you call several times during different hours and the same person answers - that's probably a one-man operation). But that doesn't always help because short-term renting an office is not all that hard and getting a call-centre outsourced to a third-world country doesn't cost all that much. It definitely helps if you're dealing with someone local, but if you're in Sweden and checking out a suspicious operation in Cyprus - this is definitely not enough.
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What happened when the dot com bubble burst?
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Two big things: In many ways, the early internet people were correct -- in 2011 we are much more productive as a society than we were in 1991. (Which comes with downsides, such as high unemployment) The bubble was a result of over-estimating those improvements and under-estimating the time required to yield those productivity gains.
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Why are credit cards preferred in the US?
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Personally, I use my credit cards for everything because I get reward points (or, cash back, depending on the card), and I build credit history. I've had credit cards since I was 18 (now 22), and my credit score is in the higher end 700s which I'm told is pretty good for my age. Additionally, since I put my rent and large purchases on my credit card, I have a lot of reward points. I use these to buy things I wouldn't normally buy to try them out and see if they bring any value into my life. If not, I didn't really lose anything, but I have found value in some of those things. I realize most of this is gamification and consumerism at play, but getting that extra little thing once in a while for "free" which is pretty nice.
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Money Saved on finance charges
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Avoiding a cost (interest) isn't quite the same as income. There is no entry, nothing for you to consider for this avoided interest. What you do have is an expense that's no longer there, and you can decide to use that money elsewhere each month.
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What exactly can a financial advisor do for me, and is it worth the money?
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In my experience financial advisors do not normally assist with budgeting and personal everyday finance. There certainly are people who do that, but you would normally only consult them when you have financial difficulties, especially debt. The more common find of financial advisor is mostly focussed on advising you about savings and investments. A lot work for banks and investment companies. They will usually advise you for free, the downside being that they will only recommend their company's products. This may or may not be a bad thing, depending on the company. Others will charge you a commission on purchases, and their advice will be more neutral. This question will also be interesting: Are all financial advisors compensated in the same way?
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How do UK Gilts interest rates and repayments work?
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The name of the Gilt states the redemption date, but not the original issue date. A gilt with 8.75% yield and close to its redemption date may have been issued at a time when interest rates were indeed close to 8.75%. For example in the early 1990s, the UK inflation rate was about 8%. One reason for preferring high or low coupon gilts is the trade off between capital gains and income, and the different taxation rules for each. If you buy a gilt and hold it to its maturity date, you know in advance the exact price that it will be redeemed for (i.e. £100). You may prefer to take a high level of income now, knowing you will make a capital loss in future (which might offset some other predictable capital gain for tax purposes) or you may prefer not to take income that you don't need right now, and instead get a guaranteed capital gain in future (for example, when you plan to retire from work). Also, you can use the change in the market value of gilts as a gamble or a hedge against your expectation of interest rate changes in future, with the "government guaranteed" fallback position that if your predictions are wrong, you know exactly what return you will get if you hold the gilts to maturity. The same idea applies to other bond investments - but without the government guarantee, of course.
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What publicly available software do professional stock traders use for stock analysis?
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Bloomberg Professional seems to be very popular. It provides any kind of data you can imagine. Analysis is a subjective interpretation of the data.
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While working overseas my retirement has not gone into a retirement account. Is it going to kill me on the FAFSA?
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Are the schools going to count all my retirement I've saved over the last 20 years as assets and calculate my EFC on 5.x% of that?! Yes.
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I have savings and excess income. Is it time for me to find a financial advisor?
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Others have mentioned the term fiduciary but haven't really gone in to what that is. Despite the name "financial advisor" there is no legal (In the US) mandate as to what that means. Often times a financial advisor is little more than a sales rep whose job it is to sell particular financial instruments. These people will give you good generic advice such as "make sure you have a nest egg" and "don't spend more than you make". However when the rubber hits the road in terms of how to save they will often recommend/insist/pressure a particular asset/security which doesn't necessarily meet your risk/reward preference/tolerance. Often times the assets they pitch have high fees. These people won't charge you for their time because their time is a loss leader for the commissions they make on selling their products. In contrast a fiduciary's job responsibility is to look out for your interests. They shouldn't receive any kind of payment based on what assets you buy. This means that you have to pay them for their time. The NAPFA website seems to have good ideas on choosing an advisor. http://www.napfa.org/HowtoFindAnAdvisor.asp
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Pay off credit cards in one lump sum, or spread over a few months?
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Pay them off immediately. But, as I note in my article Too Little Debt?, a zero utilization is actually a negative hit. So you want to just use the cards to get over 1%. i.e. if the lines add to $38K, just charge say, gas and some groceries, $100/wk. Pay in full every month. It's the amount on the statement that counts, not the amount carried month to month accruing interest, which, I hope is zero for you from now on.
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Is it ever a good idea to close credit cards?
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Credit scoring has changed recently and the answer to this question will have slightly changed. While most points made here are true: But now (as of July 2017) it is possible having a large available credit balance can negatively effect your credit score directly: ... VantageScore will now mark a borrower negatively for having excessively large credit card limits, on the theory that the person could run up a high credit card debt quickly. Those who have prime credit scores may be hurt the most, since they are most likely to have multiple cards open. But those who like to play the credit card rewards program points game could be affected as well. source
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Expiring 401(k) Stock Option and Liquidation Implications
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I have had this happen a couple of times because of splits or sales of portions of the company. The general timeline was to announce how the split was to be handled; then the split; then a freeze in purchasing stock in the other company; then a freeze in sales; followed by a short blackout period; then the final transfers to funds/options/cash based on a mapping announced at the start of the process. You need to answer two questions: To determine if the final transactions will make the market move you have to understand how many shares are involved compared to the typical daily volume. There are two caveats: professional investors will be aware of the transaction date and can either ignore the employee transactions or try and take advantage of them; There may also be a mirroring set of transactions if the people left in the old company were awarded shares in your company as part of the sale. If you are happy with the default mapping then you can do nothing, and let the transaction happen based on the announced timeline. It is easy, and you don't have to worry about deadlines. If you don't like the default mapping then you need to know when the blackout period starts, so you don't end up not being able to perform the steps you want when you want. Timing is up to you. If the market doesn't like the acquisition/split it make make sense to make the move now, or wait until the last possible day depending on which part they don't like. Only you can answer that question.
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What are some factors I should consider when choosing between a CPA and tax software
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I'm glad keshlam and Bobby mentioned there are free tools, both from the IRS and private software companies. Also search for Volunteer Income Tax Assistance (VITA) in your area for individual help with your return. A walk-in tax clinic strength is tax preparation. CPAs and EAs provide a higher level of service. For example, they compile and review your prior year's return and your current year, although that is not relevant to your current situation. EAs and CPAs are allowed to represent you before the IRS. They can directly meet or contact the IRS and navigate audits and other requests on your behalf. Outside of tax season, an accountant can help you with tax planning and other taxable events. Some people do not hire a CPA or EA until they need representation. Establishing a relationship and familiarity with an accountant now can save time and money if you do anticipate you will need representation later. Part of what makes the tax code complicated is it can use very specific definitions of a common word. Furthermore, the specific definition of a phrase or word can change between publications. Also, the tax code uses all-encompassing definitions and provide detailed and lengthy lists that are not exhaustive; you may not find your situation listed or described in the tax code, yet you are responsible for reporting your taxable events. The best software cannot navigate you through your tax situation like an accountant. Lastly, some of the smartest people I have met are accountants and to get the most out of meeting with them you should be as familiar as possible with your position. The more familiar you are with accounting, the more advanced knowledge they can share with you. In short, you will probably need an accountant when: You need to explain yourself before the IRS (representation), you are encountering varying definitions in the tax code that have an impact on your return, or you have important economic activities that you are unsure of appropriate tax treatment.
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Are there any dangers in publicly sharing my personal finance data?
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I think it's advisable to exercise a fair amount of caution when posting information about yourself online. With the advances in data aggregation efforts, information that would have been considered sufficiently anonymized in years past might no longer be sufficient to protect you from bad actors online. For example, depending on which state, and even which county you live in, the county recorder's office may allow anyone with Internet access to freely search property records by your name. If they know approximately where you live (geolocation from the IP address that you use to post to a blog--which could be divulged if criminals compromised the blogging site) and your surname, they might be able to find your exact address if you own your home. If you have considerable wealth it could open you to targeted ransom attacks from organized criminals.
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Mortgage or not?
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A primary residence can be an admirable investment/retirement vehicle for a number of reasons. The tax savings on the mortgage are negligible compared to these. A $200,000 mortgage might result in a $2000 annual savings on your taxes -- but a $350,000 house might easily appreciate $20,000 (tax free!) in a good year. Some reasons to not buy a larger house. Getting into or out of a house is tremendously expensive and inconvenient. It can make some life-changes (including retirement) more difficult. There is no way to "diversify" a primary residence. You have one investment and you are a hostage to its fortunes. The shopping center down the street goes defunct and its ruins becomes a magnet for criminals and derelicts? Your next-door neighbor is a lunatic or a pyromaniac? A big hurricane hits your county? Ha-ha, now you're screwed. As they say in the Army, BOHICA: bend over, here it comes again. Even if nothing bad happens, you are paying to "enjoy" a bigger house whether you enjoy it or not. Eating spaghetti from paper plates, sitting on the floor of your enormous, empty dining room, may be romantic when you're 27. When you're 57, it may be considerably less fun. Speaking for myself, both my salary and my investment income have varied wildly, and often discouragingly, over my life, but my habit of buying and renovating dilapidated homes in chic neighborhoods has brought me six figures a year, year after year after year. tl;dr the mortgage-interest deduction is the smallest of many reasons to invest in residential real-estate, but there are good reasons not to.
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Does a stock really dip in price on the ex-dividend date? And why would it do this?
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Suppose the price didn't drop on the ex-dividend date. Then people wanting to make a quick return on their money would buy shares the day before, collect the dividend, and then sell them on the ex-dividend date. But all those people trying to buy on the day before would push the price up, and they would push the price down trying to sell on the date.
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Formula that predicts whether one is better off investing or paying down debt
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The formula you are looking for is pretty complicated. It's given here: http://itl.nist.gov/div898/handbook/eda/section3/eda3661.htm You might prefer to let somebody else do the grunt work for you. This page will calculate the probability for you: http://stattrek.com/online-calculator/normal.aspx. In your case, you'd enter mean=.114, standard deviation=.132, and "standard score"= ... oh, you didn't say what you're paying on your debt. Let's say it's 6%, i.e. .06. Note that this page will give you the probability that the actual number will be less than or equal to the "standard score". Enter all that and click the magic button and the probability that the investment will produce less than 6% is ... .34124, or 34%. The handy rule of thumb is that the probability is about 68% that the actual number will be within 1 standard deviation of the mean, 95% that it will be within 2 standard deviations, and 99.7% that it will be within 3. Which isn't exactly what you want because you don't want "within" but "less than". But you could get that by just adding half the difference from 100% for each of the above, i.e. instead of 68-95-99.7 it would be 84-98-99.9. Oh, I missed that in a follow-up comment you say you are paying 4% on a mortgage which you are adjusting to 3% because of tax implications. Probability based on mean and SD you gave of getting less than 3% is 26%. I didn't read the article you cite. I assume the standard deviation given is for the rate of return for one year. If you stretch that over many years, the SD goes down, as many factors tend to even out. So while the probability that money in a given, say, mutual fund will grow by less than 3% in one year is fairly high -- the 25 - 35% we're talking here sounds plausible to me -- the probability that it will grow by an average of less than 3% over a period of 10 or 15 or 20 years is much less. Further Thought There is, of course, no provably-true formula for what makes a reasonable risk. Suppose I offered you an investment that had a 99% chance of showing a $5,000 profit and a 1% chance of a $495,000 loss. Would you take it? I wouldn't. Even though the chance of a loss is small, if it happened, I'd lose everything I have. Is it worth that risk for the modest potential profit? I'd say no. Of course to someone who has a billion dollars, this might be a very reasonable risk. If it fails, oh well, that could really cut in to what he can spend on lunch tomorrow.
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Is selling put options an advisable strategy for a retiree to generate stable income?
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Yes -- If you are prepared to own the stock and have the cash to buy it, it can be a good way to generate income. The downside is really no more than buying a stock and it goes down -- which can happen to any investment -- and you have the premium of the put. Just don't do it on any stock you would not buy outright. To the posters who say it's a bad idea, I would like some more info on why they think that. It's not more bad idea than any investment. Yes it has risk, but so does buying stocks in general, buying dividend stocks etc and since most options expire worthless the odds are more in your favor selling puts.
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Consumer Loans vs Mortgages
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I went here: Consumer Loan Law. It seems that a consumer loan is anything other than a business loan or mortgage. However, in California it seems to include a mortgage. It's a bit weird to see that a HEL can be considered a consumer loan even if it is the primary or the only loan on a property. Getting a HEL can be a great low cost way to (re)finance a property as they tend to have low or no closing costs and lower interest rates.
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Odds of early assignment for a short in the money call
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It depends how deep in the money it is, compared to the dividend. Even an in the money call has some time premium. As the call holder, if I exercise instead of selling the call, I am trading the potential for a dividend, which I won't receive, for getting that time premium back by selling. Given the above, you'll notice a slight distortion in options pricing as a dividend date approaches, as the option will reflect not just the time premium, but the fact that exercising with grab the dividend. Edit to address your comment - $10 stock, $9 strike, 50 cent div. If the option price is high, say $2, because there's a year till expiration, exercising makes no sense. If it's just $1.10, I gain 40 cents by exercising and selling after the dividend.
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A friend wants to use my account for a wire transfer. Is this a scam or is it legitimate?
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This is another version of an old scam -- "let me have a check deposited in your account because I can't open one for some reason, and I'll share some of the money with you." Here the scammer is promising to "start a business" with you as a way to gain your confidence and trust. The first danger sign is that you only know this person from online. They are not someone you are friends with in the "real" world. They could be anybody. They used the name of a big company as a way to make what they're doing sound legitimate, but it's all a fraud. They could be depositing a faked Exxon check into your account, which could land YOU in huge trouble. Here's the thing -- The only way Exxon (or any other company) can deposit money in a bank under someone's name is if that person provides the account and routing numbers to an account that already exists. No company can just create an account in another person's name. That's Hollywood movie stuff, but it's not how banking works. To open an account, the bank would need identification on the account holder, so your "friend" already has an account if Exxon has allegedly deposited money. Further, Exxon isn't going to take back money that has already been deposited. In fact, they can't take it back. If the account is in his name, they can't do anything to the account or with the account. This is a situation you should run away from and never look back. Nothing about this story sounds right or legitimate, but this is one of the oldest scams out there since the beginning of the Internet. You would be well advised to stay VERY far away from your supposed friend, because they're anything but your friend. You are being SCAMMED. Don't be a victim. Stop communicating with this person immediately, and DON'T give them any personal information of any kind. They're crooks! I hope this helps. Good luck!
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I spend too much money. How can I get on the path to a frugal lifestyle?
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Gail Vaz-Oxlade from the television show Til Debt Do Us Part has a great interactive budget worksheet that helps you set up a "jar" or envelope system for each month based on your income and fixed expenses. We have used this successfully in the past. What we found most useful was, as others have said, writing everything down, keeping receipts, and thus being accountable and aware of our spending.
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Is CFD a viable option for long-term trading?
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Yes it is viable but uncommon. As with everything to do with investment, you have to know what you are doing and must have a plan. I have been successful with long term trading of CFDs for about 4 years now. It is true that the cost of financing to hold positions long term cuts into profits but so do the spreads when you trade frequently. What I have found works well for me is maintaining a portfolio that is low volatility, (e.g. picking a mix of positions that are negatively correlated) has a good sharpe ratio, sound fundamentals (i.e. co-integrated assets - or at least fairly stable correlations) then leveraging a modest amount.
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If stock price drops by the amount of dividend paid, what is the use of a dividend
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Victor, Yes the drop in price does completely cancel the dividend at first. However, as others have noted, there are other forces working on the price as well. If dividends were pointless then the following scenario would be true: Let's assume, hypothetically, two identical stocks, only one of which pays a 2% annual dividend quarterly. At the end of the year we would expect the share price of the dividend stock to be 2% lower than the non-dividend stock. And an equal investment in both stocks would yield exactly the same amount of money. So that is a hypothetical, and here is real market example: I compared, i.e. took the ratio of Vanguard's S&P 500 ETF (VOO) closing price to the S&P 500 Index closing price from sep 9, (2010-2014), after accounting for the VOO 2013 split. The VOO pays a quarterly dividend(about 2%/year), the S&P is an index, hence no dividend. The VOO share price, reduced each quarter by the dividend, still grew more than the S&P each year except 2012 to 2013, but looking at the entire 4yr period the VOO share price grew 80.3987% while S&P grew 80.083% (1/3 of 1% more for VOO). VOO does drop about 1/2% relative to S&P on every ex date, but obviously it makes it up. There are other forces working on VOO. VOO is trade-able, therefore subject to supply/demand pressures, while the S&P 500 is not. So for the VOO ETF the data does not indicate pointless dividends but instead implies dividends are free money. StockCharts.com supports this. S&P500 for last 1244 days (9/8/2010) shows 90% growth http://stockcharts.com/freecharts/perf.php?%24SPX while VOO for last 1244 days shows 105% growth http://stockcharts.com/freecharts/perf.php?VOO
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Should you co-sign a personal loan for a friend/family member? Why/why not?
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Never co-sign a loan for someone, especially family Taking out a loan for yourself is bad enough, but co-signing a loan is just plain stupid. Think about it, if the bank is asking for a co-signer its because they are not very confident that the applicant is going to be paying back the loan. So why would you then step up and say I'll pay back the loan if they don't, make me a co-signer please. Here is a list of things that people never think about when they cosign a loan for somebody. Now if you absolutely must co-sign a loan here is how I would do it. I, the co-signer would be the one who makes the payments to ensure that the loan was paid on time and I would be the one collecting the payment from the person who is getting the loan. Its a very simple way of preventing some of the worst situations that can arise and you should be willing to make the payments anyway after all thats what it means to cosign a loan. Your just turning things around and paying the loan upfront instead of paying after the applicant defaults and ruins every ones credit. (Source: user's own blog post Never co-sign a loan for someone, especially family)
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How could the 14th amendment relate to the US gov't debt ceiling crisis?
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Section Four of the amendment reads: The validity of the public debt of the United States, authorized by law, including debts incurred for payments of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. In other words, if President Obama wants to, he could unilaterally invoke this provision and go ahead and get the money he needs. Good articles describing this in some detail can be found here and here.
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Is it worth it to buy TurboTax Premier over Deluxe if I sold investments in a taxable account?
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Here are the lists for the tax forms that Deluxe and Premier include. I think you'll be fine with Deluxe because it sounds like all you need is the Schedule D/8949 forms. Deluxe actually includes most investment related forms.
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I earn $75K, have $30K in savings, no debt, rent from my parents who are losing their home. Should I buy a home now or save?
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The biggest red flag is the fact that your parents may lose their house. There are multiple parts of the decision. The red flag comes in because you are stretching your finances to the max to afford the house you are interested in. Buying down the interest rate makes some sense depending on how long you plan on staying, but not a a way to afford house X. Of course a bigger down payment will also influence the size of the house. You are also buying something in case your parents need a place to live. What happens if that never occurs? You now have something bigger than you need. You are mixing investments and housing. There is no guarantee that you will even break-even on the house as a investment. It can take several years to make back the closing costs involved in buying and selling a house, based solely on stable price and your monthly payments. If the price drops you might never make the money back. You might be better off renting what you need now or waiting until the current house is lost and then renting what you need then.
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Why is Insider Trading Illegal?
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Secret formulas are legal, "privileged information" is not. And that may be the whole point. People are allowed to trade stocks profitably if doing so results only from their skill. A "secret formula" (for evaluating information) is part of that skill. But having "privileged information" is not considered skill. It is considered an unfair, illegal advantage. Because company officials (and others) with privileged information are 1) not permitted to trade stocks while that information is privileged and 2) are not allowed to share that information with others. Inevitably, some do one or the other, which is why they are prosecuted. "Raj" took the process to new highs (or lows). He not only "dealt" in privileged information, he PAID for it. Anything from a new car or house to $500,000 a year in cash. In essence, he had a bunch of strategically placed "spies" inside or close to corporations including one on the board of Goldman Sachs, "selling out" their companies, and thereby practicing a form of corporate "treason."
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How to transfer personal auto lease to business auto lease?
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I'd approach the lender that you're getting the lease from, but be prepared for them either saying 'no' to putting the lease into the name of an LLC without any proven track record (because it hasn't been around for a while) or require you to sign a personal guarantee, which partially defeats the purpose of putting the car lease into the LLC. I'd also talk to an accountant to see if you can't just charge the business the mileage on your vehicle as that might be the simplest solution, especially if the lender gets stroppy. Of course the mileage rate might not cover the expense for the lease as that one is designed to cover the steepest part of the depreciation curve. Does your LLC generate the revenue needed so it can take on the lease in the first place? If it's a new business you might not need or want the drain on your finances that a lease can be.
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Are Forex traders forced to use leverage?
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Actually, most of the forex traders do not prefer the practice of leveraging. In forex trading, a contract signed by a common trader is way more than any common man can afford to risk. It is not a compulsion for the traders to use leveraging yet most of the traders practice it. The other side of it is completely different. Trading companies or brokers specifically like it because you turn into a kind of cash cow when your account gets exhausted. As for trader, most of them don’t practice leveraging.
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Lending to the bank
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The easiest way would be to set up a common savings account. Most of them pay some meager interest rate, and over one night it would be especially meager. A Certificate of Deposit is another way, but you'd have to lock the funds in for an extended period of time.
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How to open a Mega Money Market account without an ssn?
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According to the IRS: Aliens who are not eligible to apply for a U.S. social security number, or who do not meet the Social Security Administration's evidence requirements for an SSN, may apply for an Individual Taxpayer Identification Numbers (ITIN) from the Internal Revenue Service if they have a valid tax reason for needing an ITIN, as explained in the Form W-7 instructions. Seeing as you don't have a valid tax reason for an ITIN, your request will probably be denied by the IRS.
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Why do companies have a fiscal year different from the calendar year?
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I can think of a few good reasons: A company, especially public, usually wants their fourth-quarter earnings to be the strongest of the year. That ends each fiscal year on a high note for the company and its investors, which helps public sentiment and boosts stock prices. So, travel agencies and airlines usually like ending their year in October or March, in the lull between the summer and winter travel seasons with a large amount of that revenue falling within the company's fiscal Q4. Oil companies sometimes do the same because fuel prices are seasonal for much the same reasons. December is a really bad month to try to close out an entire year's accounting books. Accountants and execs are on vacation for large parts of the month, most retail stores are flooded with revenue (and then contra-revenue as items are returned) that takes time to account at the store level and then filter up to the corporate office, etc etc. It also doesn't tell the whole story for most retail outfits; December sales are usually inflated by purchases that are then returned in January after all the hullaballoo. As a result, a fiscal year end in January or even February keeps the entire season's revenues and expenses in one fiscal year.
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What are my options to deal with Student Loan debt collectors?
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I had about $16k in student loans. I defaulted on the loans, and they got > passed to a collection type agency (OSCEOLA). These guys are as legitimate as a collection agency can be. One thing that I feel is very sketchy is when they were verifying my identity they said "Does your Social Security Number end in ####. Is your Birthday Month/Day/Year." That is not sketchy. It would be sketchy for a caller to ask you to give that information; that's a common scheme for identity theft. OSCEOLA are following the rules on this one. My mom suggested I should consider applying for bankruptcy Won't help. Student loans can't be discharged in bankruptcy. You have the bankruptcy "reform" act passed during the Bush 43 regime for that. The loan itself is from school. What school? Contact them and ask for help. They may have washed their hands of your case when they turned over your file to OSCEOLA. Then again, they may not. It's worth finding out. Also, name and shame the school. Future applicants should be warned that they will do this. What can I do to aid in my negotiations with this company? Don't negotiate on the phone. You've discovered that they won't honor such negotiations. Ask for written communications sent by postal mail. Keep copies of everything, including both sides of the canceled checks you use to make payments (during the six months and in the future). Keep making the payments you agreed to in the conversation six months ago. Do not, EVER, ignore a letter from them. Do not, EVER, skip going to court if they send you a summons to appear. They count on people doing this. They can get a default judgement if you don't show up. Then you're well and truly screwed. What do you want? You want the $4K fee removed. If you want something else, figure out what it is. Here's what to do: Write them a polite letter explaining what you said here. Recount the conversation you had with their telephone agent where they said they would remove the $4K fee if you made payments. Recount the later conversation. If possible give the dates of both conversations and the names of the both agents. Explain the situation completely. Don't assume the recipient of your letter knows anything about your case. Include evidence that you made payments as agreed during the six months. If you were late or something, don't withhold that. Ask them to remove the extra $4K from your account, and ask for whatever else you want. Send the letter to them with a return receipt requested, or even registered mail. That will prevent them from claiming they didn't get it. And it will show them you're serious. Write a cover letter admitting your default, saying you relied on their negotiation to set things straight, and saying you're dismayed they aren't sticking to their word. The cover letter should ask for help sorting this out. Send copies of the letter with the cover letter to: Be sure to mark your letter to OSCEOLA "cc" all these folks, so they know you are asking for help. It can't hurt to call your congressional representative's office and ask to whom you should send the letter, and then address it by name. This is called Constituent Service, and they take pride in it. If you send this letter with copies you're letting them know you intend to fight. The collection agency may decide it's not worth the fight to get the $4K and decide to let it go. Again, if they call to pressure you, say you'd rather communicate in writing, and that they are not to call you by telephone. Then hang up. Should I hire a lawyer? Yes, but only if you get a court summons or if you don't get anywhere with this. You can give the lawyer all this paperwork I've suggested here, and it will help her come up to speed on your case. This is the kind of stuff the lawyer would do for you at well over $100 per hour. Is bankruptcy really an option Certainly not, unfortunately. Never forget that student lenders and their collection agencies are dangerous and clever predators. You are their lawful prey. They look at you, lick their chops, and think, "food." Watch John Oliver's takedown of that industry. https://www.youtube.com/watch?v=hxUAntt1z2c Good luck and stay safe.
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What is the correct way to report a tender offer fee on my taxes?
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It is perfectly legitimate to adjust your 1099-B income by broker's fees. Publication 17 (p 116) specifically instructs taxpayers to adjust their Schedule D reporting by broker's fees: Form 1099-B transactions. If you sold property, such as stocks, bonds, or certain commodities, through a broker, you should receive Form 1099-B or substitute statement from the broker. Use the Form 1099-B or the substitute statement to complete Form 8949. If you sold a covered security in 2013, your broker should send you a Form 1099-B (or substitute statement) that shows your basis. This will help you complete Form 8949. Generally, a covered security is a security you acquired after 2010. Report the gross proceeds shown in box 2a of Form 1099-B as the sales price in column (d) of either Part I or Part II of Form 8949, whichever applies. However, if the broker advises you, in box 2a of Form 1099-B, that gross proceeds (sales price) less commissions and option premiums were reported to the IRS, enter that net sales price in column (d) of either Part I or Part II of Form 8949, whichever applies. Include in column (g) any expense of sale, such as broker's fees, commissions, state and local transfer taxes, and option premiums, unless you reported the net sales price in column (d). If you include an expense of sale in column (g), enter “E” in column (f). You can rely on your own records and judgment, if you feel comfortable doing so. Brokers often make incomplete tax reporting. This may have been simpler from their perspective if the broker fees were variable, or integrated, or unknown for a number of clients party to a transaction. If a taxpayer has documentation of the expenses that justify an adjustment, then it's perfectly appropriate to include that in the calculations. It is not necessary to report the discrepancy, and it may increase scrutiny to include a written addendum. The Schedule D, Form 8949, and Form 1099-B will probably together adequately explain the source of the deduction.
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How can I improve my credit score if I am not paying bills or rent?
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You can improve your credit score simply by being an authorized user on someone's credit card account. They don't even physically have to give you a card to use, they can just add you to the account as an authorized user and your credit score will be affected. Be forewarned though, it can be negatively impacted as well. Only participate in such a scheme if it's with someone trustworthy and reliable.
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Why I cannot find a “Pure Cash” option in 401k investments?
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Technically there could be a true cash fund, but the issue is it would need to have some sort of cost associated with it, which would mean it would have negative yield or would charge a fee. In some cases, this might be preferable to having it invested in "cash equivalents," which as you note are not cash. It is important to note that there is nothing, even cash or physical precious metals, that is considered zero risk. They all just have different risks associated with them, that may be an issue under certain circumstances. In severe deflation, cash is king, and all non-cash asset classes and debt could go down in value. Under severe inflation, cash can become worthless. One respondent mentioned an alternative of stopping contributing to a 401k and depositing money in a bank, but that is not the same as cash either. In recent decades, people have been led to believe that depositing your money in the bank means you hold that in cash at the bank. That is untrue. They hold your deposit on their books and proceed to invest/loan that money, but those investments can turn sour in an economic and financial downturn. The same financial professionals would then remind you that, while this is true, there is the Federal Deposit Insurance Corporation (FDIC) that will make you whole should the bank go under. Unfortunately, if enough banks went under due to lack of reserves, the FDIC may be unable to make depositors whole for lack of reserves. In fact, they were nearing this during the last financial crisis. The sad thing is that the financial industry is bias against offering what you said, because they make money by using your money. Fractional reserve banking. You are essentially holding IOUs from your bank when you have money on deposit with them. Getting back to the original question; you could do some searching and see if there is an institution that would act as a cash depository for physical cash in your IRA. There are IRA-approved ways of holding physical precious metals, which isn't all too different of a concept from holding physical cash. 401k plans are chosen by your company and often have very limited options available, meaning it'd be unlikely you could ever hold physical cash or physical precious metals in your 401k.
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Merrill Lynch historical stock prices - where to find?
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You could try asking Merrill Lynch, (general inquiries) :- http://www.ml.com/index.asp?id=7695_114042 So far I only found a few graphics :- http://topics.nytimes.com/top/news/business/companies/merrill_lynch_and_company/ http://www.reuters.com/article/2008/01/17/us-merrilllynch-results-idUSWNAS674520080117 http://www.stocktradingtogo.com/2008/09/15/merrill-lynch-saved-by-bank-of-america-buyout/
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Is a stock's trade size history publicly available?
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You can buy the data and process it on your own. http://www.nyxdata.com/Data-Products/Daily-TAQ
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How are bonds affected by the Federal Funds Rate?
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The federal funds rate is one of the risk-free short-term rates in the economy. We often think of fixed income securities as paying this rate plus some premia associated with risk. For a treasury security, we can think this way: (interest rate) = (fed funds rate) + (term premium) The term premium is a bit extra the bond pays because if you hold a long term bond, you are exposed to interest rate risk, which is the risk that rates will generally rise after you buy, making your bond worth less. The relation is more complex if people have expectations of future rate moves, but this is the general idea. Anyway, generally speaking, longer term bonds are exposed to more interest rate risk, so they pay more, on average. For a corporate bond, we think this way: (interest rate) = (fed funds rate) + (term premium) + (default premium) where the default premium is some extra that the bond must pay to compensate the holder for default risk, which is the risk that the bond defaults or loses value as the company's prospects fall. You can see that corporate and government bonds are affected the same way (approximately, this is all hand-waving) by changes in the fed funds rate. Now, that all refers to the rates on new bonds. After a bond is issued, its value falls if rates rise because new bonds are relatively more attractive. Its value rises if rates on new bonds falls. So if there is an unexpected rise in the fed funds rate and you are holding a bond, you will be sad, especially if it is a long term bond (doesn't matter if it's corporate or government). Ask yourself, though, whether an increase in fed funds will be unexpected at this point. If the increase was expected, it will already be priced in. Are you more of an expert than the folks on wall-street at predicting interest rate changes? If not, it might not make sense to make decisions based on your belief about where rates are going. Just saying. Brick points out that treasuries are tax advantaged. That is, you don't have to pay state income tax on them (but you do pay federal). If you live in a state where this is true, this may matter to you a little bit. They also pay unnaturally little because they are convenient for use as a cash substitute in transactions and margining ("convenience yield"). In general, treasuries just don't pay much. Young folk like you tend to buy corporate bonds instead, so they can make money on the default and term premia.
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Is this investment opportunity problematic?
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It would have to be made as a "gift", and then the return would be a "gift" back to you, because you're not allowed to use a loan for a down payment. I see some problems, but different ones than you do: One more question: is the market really hot right now? It was quite cold for the last few years.
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Where can I find a company's earnings history for free?
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I was going to comment above, but I must have 50 reputation to comment. This is a question that vexes me, and I've given it some thought in the past. Morningstar is a good choice for simple, well-organized financial histories. It has more info available for free than some may realize. Enter the ticker symbol, and then click either the Financials or the Key Ratios tab, and you will get 5-10 years of some key financial stats. (A premium subscription is $185 per year, which is not too outrageous.) The American Association of Individual Investors (AAII) provides some good histories, and a screener, for a $29 annual fee. Zacks allows you to chart a metric like EPS going back a long ways, and so you can then click the chart in order to get the specific number. That is certainly easier than sorting through financial reports from the SEC. (A message just popped up to say that I'm not allowed to provide more than 2 links, so my contribution to this topic will end here. You can do a search to find the Zacks website. I love StackExchange and usually consult it for coding advice. It just happens to be an odd coincidence that this is my first answer. I might even have added that aside in a comment, but again, I can't comment as of yet.) It's problem, however, that the universe of free financial information is a graveyard of good resources that no longer exist. It seems that eventually everyone who provides this information wants to cash in on it. littleadv, above, says that someone should be paid to organize all this information. However, think that some basic financial information, organized like normal data (and, hey, this is not rocket science, but Excel 101) should be readily available for free. Maybe this is a project that needs to happen. With a mission statement of not selling people out later on. The closest thing out there may be Quandl (can't link; do a search), which provides a lot of charts for free, and provides a beautiful and flexible API. But its core US fundamental data, provided by Sharadar, costs $150 per quarter. So, not even a basic EPS chart is available there for free. With all of the power that corporations have over our society, I think they could be tabulating this information for us, rather than providing it to us in a data-dumb format that is the equivalent of printing a SQL database as a PDF! A company that is worth hundreds of billions on the stock market, and it can't be bothered to provide us with a basic Excel chart that summarizes its own historical earnings? Or, with all that the government does to try to help us understand all of these investments, they cannot simply tabulate some basic financial information for us? This stuff matters a great deal to our lives, and I think that much of it could and should be available, for free, to all of us, rather than mainly to financial professionals and those creating glossy annual reports. So, I disagree that yet another entity needs to be making money off providing the BASIC transparency about something as simple as historical earnings. Thank you for indulging that tangent. I know that SE prides itself on focused answers. A wonderful resource that I greatly appreciate.
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Possible to use balance transfers to avoid interest with major credit cards?
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IMO, it's a good deal. Pre-paying 3% interest is better than accruing it at 1-2% per month. The other nice thing about it is that all of your payments hit the principal.
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Working for recruiter on W-2 vs. working for client on 1099?
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The tax savings of being 1099 can be significant. It depends on your salary, and what you can deduct. You may want to consult with an accountant. The social security tax, for the self employed, is 12.4% of profit not on revenue. If you can write off more than half of the income as expenses then you could be paying less than a w-2 employee. Also you might make a higher salary as a 1099, it is rare the offer the same compensation for a W-2 as a 1099 as the former has higher expenses for the employer. It is hard to know without actual numbers, actual expected expense deductions and so forth. Which is why I would suggest consulting with an accountant. You may want to talk to one in the state where he will be working rather than where you live now.
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How does Robinhood stock broker make money?
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Disclosure: I don't have an iPhone, so I don't use RobinHood. That being said, I have a less "they're-out-to-get-ya" view of what they're doing. As a small business owner (2 businesses), employees cost the most. If you can create a solid business with few (or no) employees and let robots run it, you will drastically reduce your costs. Joe Polish said it similarly with sales letters, something along the lines of they never complain about a headache, need to take a year off to discover themself, or just need a personal day. Robots are the same; they do not have human limits. Most simple trading can be done and maintained by well written code and AI, there's very little need for humans to do anything other than build it. Think about the efficiency of bitcoin versus all the central banks combined; how many people are employed by central banks? Robinhood states that they are using technology in these ways to minimize costs and they're using a system that doesn't need physical branches (this doesn't mean they will never have them, just that they don't need them). Robinhood does not indicate that they allow everything to happen for free; only stock trading. I worked for a large trading firm once and observed that stock trading wasn't the bulk of where they made their money anyway; trading options, futures, index funds, etc are where the big money was and Robinhood says nothing about those being free. Like the CQM mentioned too, they'll be charging for margin as well. In a way, the individual stock trader is dead; many people - including this forum - prefer index funds, so more than likely, Robinhood will strike up a deal with an index fund company or create their own (this is just easy, passive income with an expense ratio). In this category, the markets are their playground, but they do need to attract enough people to their platform, thus free stock trading is a good way to do it. As for selling your information for advertising, that is always a possibility, but they have quite a few other options that would be good for most investors (index funds, affiliating with financial fund companies, etc) where they can start before ever needing to dip their toe in selling information. This isn't to say they won't do it, but that there are few other options they have. The major concern I have for Robinhood is ongoing security. Just building it and letting it run kind of assumes that there won't be major compromises in the future and as AI evolves, superior AI might be able to crush older AI.
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Why use accounting software like Quickbooks instead of Excel spreadsheets?
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Since this is a cooperative I'm guessing your partners may want to be able to view the books so another key point you may want to consider is collaboration. QuickBooks desktop has all of these same issues because it is meant to be used on a single desktop. We're in an age of mobile devices, and especially in a business like landscaping it would be nice if certain aspects of record keeping could be done at the point and time where they are incurred. I'd argue you want a Software as a Service (SaaS) accounting package as opposed to "accounting software" which might come on a CD in the form of QuickBooks, Sage and others. Additionally, most of these will also have guides to help make sure you are properly entering your records. Most of these SaaS products also have customer success teams to help you along should you need assistance. Depending on the level of your subscription you may get more sophisticated handling of taxes, customized invoices or integrated payroll. Your goal is to keep accurate records so you can better run your business and maintain obligations like filing taxes. You're not keeping the records just to have them. Keep them in a place where they will work for you and provide the insights and functionality that will help your business grow and become successful. Accounting software will always win in this scenario over a spreadsheet. FULL DISCLAIMER: I work for Kashoo, a simple cloud accounting product designed for small businesses. But the points I mention above are true for Xero, QuickBooks Online and Wave as well as Kashoo. And if you really want expertise to go with the actual software consider service providers with a platform like: Indinero, Bench, easyrecordbooks or Liberty Accounting.
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Is buying or selling goods for gold or silver considered taxable?
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Of course. The rationale is exactly the same as always: profit is taxed. The fact that you use intermediate barter to make that profit is irrelevant. To clarify, as it seems that you think it makes a difference that no money "changed hands". Consider this situation: So far your cost is $10000. How will the tax authority address this? They will look at the fair market value of the barter. You got gold worth of $20000. So from their perspective, you got $20000, and immediately exchanged it into gold. What does it mean for you? That you're taxed on the $10000 gain you made on your product X (the $20000 worth of barter that you received minus the $10000 worth of work/material/expenses that you spend on producing the merchandise), and that you have $20000 basis in the gold that you now own. If in a year, when you plan to sell the gold, its price drops - you can deduct investment losses. If its price goes up - you'll have investment gain. But for the gain you're making on your product X you will pay taxes now, because that's when you realized it - sold the merchandize and received in return something else of a value.
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Townhouse or stand-alone house for a first home?
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Houses tend to appreciate more than condos. Houses are also more expensive. So it's a choice. You mention your girlfriend will be buying it with you. Take the time now to decide what will happen if you split up and put it in writing. Are you splitting the downpayment and mortgage 50/50? If not things can get complicated. Also consider home improvement costs, etc. If you think she is "the one" and you'll end up starting a family together, look at the location, nearby schools, etc. Sure, it may sound too early to be thinking about these things, but if you get a head start on finding a nice house you could save a lot of money and build a lot of equity with some smart decisions today.
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Why most of apple stock price since 10years have been gained overnight?
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I'll answer this question: "Why do intraday traders close their position at then end of day while most gains can be done overnight (buy just before the market close and sell just after it opens). Is this observation true for other companies or is it specific to apple ?" Intraday traders often trade shares of a company using intraday leverage provided by their firm. For every $5000 dollars they actually have, they may be trading with $100,000, 20:1 leverage as an example. Since a stock can also decrease in value, substantially, while the markets are closed, intraday traders are not allowed to keep their highly leveraged positions opened. Probabilities fail in a random walk scenario, and only one failure can bankrupt you and the firm.
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How should I pay off my private student loans that have a lot of restrictions?
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It's definitely NOT a good idea to pay off one of the smaller loans in your case - a $4k payment split across all the loans would be better than repaying the 5% / $4k loan completely, as it's the most beneficial of your loans and thus is last priority for repayment. A payment that splits across all the loans equally is, in effect, a partial repayment on a loan with an interest rate of 6.82% (weighed average rate of all your loans). It's not as good as repaying a 7% loan, but almost as good. It might be an option to save up until you can repay one of your 7% loans, but it depends - if it takes a lot of time, then you would've paid unneccessary interest during that time.
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Can extra mortgage payments be made to lower the monthly payment amount?
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Typically, this is not an option, as the monthly payments are fixed. It depends on the willingness of your financing bank for such a change. You probably will have to refinance (with them or another lender); which is not a bad thing, as you even can get a lower interest rate potentially (as of Jan 2017 - this will change). Consider too: It could be a better solution to instead invest the 25000, and use the investment returns to fill up the difference every month. Certainly more effort, but you probably come out ahead financially.
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Precedent and models for 100% equity available via initial offering?
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Founder makes available 100% equity, but uses a reasonable amount of the proceeds to pay him/herself a salary (or wage) and from that salary invests in the same initial offering to acquire shares for him/herself. I see several problems. What is a reasonable salary? Also, this leaves the door open to the following scam: Founders say that they are going to follow this plan. However, instead of buying shares, they simply quit after being paid the salary. They use knowledge gained from this business to start a competitor. Investors are left holding an empty company. Tax consequences. The founder would pay income tax on the salary. By contrast, if the founder instead sells shares, that would be capital gains tax, which is lower in many countries (e.g. the United States). Why would I want to invest in a business where the founders don't believe in it enough to take a significant equity stake? Consider the Amazon.com example. Jeff Bezos makes a minimal salary, around $80,000 a year, less than many of his employees. But he has a substantial ownership position. If the company doesn't make money, he won't. Would investors really value the stocks with a P/E of 232.10 in 2016 if they didn't trust him to make the right long term decisions? It's also worth noting that most initial public offerings (IPOs) are not made when the founder is the only employee. A single employee company instead looks for private investors, often called angel investors. Companies generally don't go public until they are established in some way, often making money. Negotiating with angel investors is different from negotiating with the public. They can personally review the books and once invested tend to have input on how the money is spent. In other words, this is mostly solving the wrong problem if you talk about IPOs. This might make more sense with a crowdfunded venture, as that replaces a few angel investors with many individuals. But most crowdfunded ventures tend to approach things from the opposite direction. Instead of looking for investors, they look for customers. If they offer a useful product, they will get customers. If not, they never get the money. Beyond all this, if a founder is only going to get a fair salary some of the time, then why put in any sweat equity? This works fine if the company looks valuable after a year. What if it doesn't? The founder is out a year of sweat equity and has nothing in return. That happens now too, but the possibility of the big return offsets it. You're taking out the big return. I don't think that this is good for either founders or investors. The founder trades a potentially good or even great return for a mediocre return. The investors trade a situation where both they and the founder benefit from a successful company to one where they benefit a lot more than the founder. That's not good for either side.
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Is it ever logical to not deposit to a matched 401(k) account?
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One situation where it would be prudent not to contribute would be if expenses are so tight that you cannot afford to contribute because you need that cashflow for expenses.
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