After searching a bit and talking to some investment advisors in India I got below information. So thought of posting it so that others can get benefited. This is specific to indian mutual funds, not sure whether this is same for other markets. Even currency used for examples is also indian rupee. A mutual fund generally offers two schemes: dividend and growth. The dividend option does not re-invest the profits made by the fund though its investments. Instead, it is given to the investor from time to time. In the growth scheme, all profits made by the fund are ploughed back into the scheme. This causes the NAV to rise over time. The impact on the NAV The NAV of the growth option will always be higher than that of the dividend option because money is going back into the scheme and not given to investors.  How does this impact us? We don't gain or lose per se by selecting any one scheme. Either we make the choice to get the money regularly (dividend) or at one go (growth). If we choose the growth option, we can make money by selling the units at a high NAV at a later date. If we choose the dividend option, we will get the money time and again as well as avail of a higher NAV (though the NAV here is not as high as that of a growth option). Say there is a fund with an NAV of Rs 18. It declares a dividend of 20%. This means it will pay 20% of the face value. The face value of a mutual fund unit is 10 (its NAV in this case is 18). So it will give us Rs 2 per unit. If we own 1,000 units of the fund, we will get Rs 2,000. Since it has paid Rs 2 per unit, the NAV will fall from Rs 18 to Rs 16. If we invest in the growth option, we can sell the units for Rs 18. If we invest in the dividend option, we can sell the units for Rs 16, since we already made a profit of Rs 2 per unit earlier. What we must know about dividends The dividend is not guaranteed. If a fund declared dividends twice last year, it does not mean it will do so again this year. We could get a dividend just once or we might not even get it this year. Remember, though, declaring a dividend is solely at the fund's discretion; the periodicity is not certain nor is the amount fixed.


Your question is very widely scoped, making it difficult to reply to, but I can provide my thoughts on at least the following part of the question: I have a 401k plan with T. Rowe Price, should I use them for other investments too? Using your employer's decision, on which 401k provider they've chosen, as a basis for making your own decision on a broker for investing $100k when you don't even know what kind of investments you want seems relatively unwise to me, even if one of your focuses is simplicity.  That is, unless your $100k is tax-advantaged (e.g. an IRA or other 401k) and your drive for simplicity means you'd be happy to add $100k to any of your existing 401k investments.  In which case you should look into whether you can roll the $100k over into your employer's 401k program. For the rest of my answer, I'll assume the $100k is NOT tax-advantaged. I assume you're suggesting this idea because of some perceived bundling of the relationship and ease of dealing with one company & website?  Yes, they may be able to combine both accounts into a single login, and you may be able to interact with both accounts with the same basic interface, but that's about where the sharing will end.  And even those benefits aren't guaranteed.  For example, I still have a separate site to manage my money in my employer's 401k @ Fidelity than I do for my brokerage/banking accounts @ Fidelity.  The investment options aren't the same for the two types of accounts, so the interface for making and monitoring investments isn't either. And you won't be able to co-mingle funds between the 401k and non-tax-advantaged money anyway, so you'll have two different accounts to deal with even if you have a single provider.  Given that you'll have two different accounts, you might as well pick a broker/provider for the $100k that gives you the best investment options, lowest fees, and best UI experience for your chosen type/goal of investments. I would strongly recommend figuring out how you want to invest the $100k before trying to figure out which provider to use as a broker for doing the investment.


"Since these indices only try to follow VIX and don't have the underlying constituents (as the constituents don't really exist in most meaningful senses) they will always deviate from the exact numbers but should follow the general pattern. You're right, however, in stating that the graphs that you have presented are substantially different and look like the indices other than VIX are always decreasing. The problem with this analysis is that the basis of your graphs is different; they all start at different dates... We can fix this by putting them all on the same graph:  this shows that the funds did broadly follow VIX over the period (5 years) and this also encompasses a time when some of the funds started. The funds do decline faster than VIX from the beginning of 2012 onward and I had a theory for why so I grabbed a graph for that period. My theory was that, since volatility had fallen massively after the throes of the financial crisis there was less money to be made from betting on (investing in?) volatility and so the assets invested in the funds had fallen making them smaller in comparison to their 2011-2012 basis.  Here we see that the funds are again closely following VIX until the beginning of 2016 where they again diverged lower as volatility fell, probably again as a result of withdrawals of capital as VIX returns fell. A tighter graph may show this again as the gap seems to be narrowing as people look to bet on volatility due to recent events. So... if the funds are basically following VIX, why has VIX been falling consistently over this time? Increased certainty in the markets and a return to growth (or at least lower negative growth) in most economies, particularly western economies where the majority of market investment occurs, and a reduction in the risk of European countries defaulting, particularly Portugal, Ireland, Greece, and Spain; the ""PIGS"" countries has resulted in lower volatility and a return to normal(ish) market conditions. In summary the funds are basically following VIX but their values are based on their underlying capital. This underlying capital has been falling as returns on volatility have been falling resulting in their diverging from VIX whilst broadly following it on the new basis."


Every 90 days add an Initial Fraud Alert to each of the 3 major credit bureaus.


"Here is the way I would estimate your taxes.  Remember that a bi-weekly paycheck means that you get 26 paychecks per year. If the $1000 federal refund is too much for you, you can decrease your withholding to bring your refund down.  This can be done by increasing your exemptions claimed on your W-4.  See ""How can I adjust tax withholding so that I don't get a large Tax Refund?"" for more details. However, keep in mind that your state withholding is perfect right now, and if you increase your exemptions, you will likely owe tax to the state, unless you increase your state withholding at the same time."


I already know of this method. I was creating a peer group and found 4-5 very similar companies, however one of them is a foreign public company with a subsidiary competing directly with a company I am trying to find the beta for. I guess I have to omit this company because it's strictly foreign?   Also, what do I do if I can't find any public companies that are similar to the company I am trying to value?


Does you job offer a retirement plan?  (401k, SIMPLE, etc)  Does your employer offer a match on contributions? Typically an employer will match what you put in, up to a certain percentage (e.g. 3%). So, say you contribute 3% of your paycheck into your retirement plan. If your employer mathes that, you've effectively contributed 6%. You've just doubled your money! The best thing a young professional can do is to contribute to your employer-matched retirement plan, up to the maximum amount they will match. You should do it immediately.  If not, you are leaving money on the table.


You would report the overall income on your T1 general income tax return, and use form T2125 to report income and expenses for your business.  Form T2125 is like a mini income-statement where you report your gross revenue and subtract off expenses.  Being able to claim legitimate expenses as a deduction is an important tax benefit for businesses big and small. In terms of your second question, you generally need to register for a business number at least once you cross the threshold for GST / HST. If you earn $30,000/year (or spread over four consecutive quarters) then charging GST / HST is mandatory; see GST/HST Mandatory registration.  There are other conditions as well, but the threshold is the principal one. You can also register voluntarily for GST / HST even if you're below that threshold; see GST/HST Voluntary registration.  The advantage of registering voluntarily is that you can claim input tax credits (ITC) on any GST that your business pays, and remit only the difference.  That saves your business money, especially if you have a lot of expenses early on. Finally, in terms of Ontario specifically (saw that on your profile), you might want to check out Ontario Sole Proprietorship.  There are specific cases in which you need to register a business: e.g. specific types of businesses, or if you plan on doing business under a name other than your own. Finally, you may want to consider whether incorporating might be better for you.  Here's an interesting article that compares Sole Proprietorship Versus Incorporation.  Here's another article, Choosing a business structure, from the feds.


Have you found a general contractor to rebuild your home? I would imagine that someone with a bit of expertise in the area is used to dealing with insurance companies, floating the money for a rebuild, and hitting the gates to receive payment for work accomplished.   Business are used to not receiving payment when work is accomplished and it is part of the risk of being in business.  They have to buy materials and pay employees with the expectation of payment in the future.  Much like workers go to work on a Monday for the work that day, three Friday's later, business often have to float costs but for longer periods of time. If you are looking to be your own general contractor then you will have to float the money on your own. The money should not be used for living expenses or mortgage payments, it should be used for down payments in order to get the work of rebuilding started.


So why not talk to your employer, and ask them to pay you in gold dust? Then when tax time comes, just convert some gold dust into the amount of USD in taxes you owe.   Of course, you'd have to find farmers and shoemakers and electronic stores willing to accept payment in gold dust as well...


"Why? Simply: because it has been mandated as law, and so you may have no choice in the matter whether to contribute or not. Quoting from GOV.UK – Workplace pensions: ‘Automatic enrolment’  A new law means that every employer must automatically enrol workers   into a workplace pension scheme if they: Next: even if you think you will work ""until you die"", you can still access the money saved in the pension scheme when you attain the required minimum age for withdrawals under your scheme. For instance, that may be age 55, but it may also vary by scheme. Becoming fully retired — as in stopping all work — is not a requirement to access retirement income from your pension scheme. In the eyes of a pension scheme, retirement is typically when you elect to take your income benefits according to the established rules of the scheme. Quoting from nidirect – Working past State Pension age: Continuing in work and your workplace pension  If you reached the age at which you can start claiming your workplace   pension scheme, you don't need to stop work in order to claim. You have   a number of options, including taking some of the pension you've built   up while continuing to work for the same employer. As to why things are set up this way: While some younger folk may, today, expect to continue working until death, for a variety of reasons that isn't always possible. Two typical such reasons are: disability, and involuntary unemployment (i.e. willing and able but still can't land the next job). Moreover, plans change. Young workers with health and vitality may expect they'll always feel invincible, but end up learning otherwise over time, and may come to appreciate the savings that were forced upon them. The ""forced savings"" aspect of state and state-sponsored pension schemes are meant to provide some safety net for those later years when it is a strong possibility that one can't continue to work. The alternative is to be a 100% burden on family and/or society."


"20-year Treasury Bonds are not equivalent to cash, not even close.  Even though the bonds are backed by the full faith and credit of the U.S. Government, they are long-term debt and therefore their principal value will fluctuate considerably as market interest rates change. When interest rates rise, the market value of 20-year bonds will drop, and drop more than shorter-term bonds would.  Your principal is not protected in the short term.  Principal is only guaranteed returned at the 20-year maturity of those bonds.  But, oops, there is no maturity on the 20-year bond ETFs because every year the ETF rolls the 19-year positions into new 20-year positions! ;-) For an ""equivalent to cash"" piece of a portfolio, I'd want my principal to be intact over the short term, and continually reinvested at the higher short-term rates as rates are rising.  Reinvesting at short-term rates can be an inflation-hedge.  But, money locked in for 20-years is a sitting duck for inflation. Still, inflation aside, why do we want our ""equivalent to cash"" position to be relatively liquid and principal-protected? When it comes time to rebalance your portfolio after disastrous equity and/or bond returns, you've got in your cash component some excess weighting since it was unaffected by the disastrous performance. That excess cash is ready to be deployed to purchase equities and/or bonds at the lower current prices.  Rebalancing from cash can add a bonus to your returns and smooth volatility.  If you have no cash component and only equities and bonds, you have no money to deploy when both equities and bonds are depressed.  You didn't keep any powder dry.  And, BTW, I would personally keep a bit more than 3% of my powder dry. Consider a short-term cash deposit or good money-market fund for your ""equivalent to cash"" position."


You can probably roll it over into the new company's 401k too, so just talk to your HR rep there.  I set up a separate Vangard IRA so when I changejobs or anything, I just dump my investments into that account and don't have to worry about keep track of them all over the place.


Waiting for the next economic downturn probably isn't the best plan at this point. While it could happen tomorrow, you may end up waiting a long time. If you would prefer not to think much about your investment and just let them grow then mutual funds are a really good option. Make sure you research them before you buy into any and make sure to diversify, as in buy into a lot of different mutual funds that cover different parts of the market. If you want to be more active in investing then start researching the market and stick to industries you have  very good understanding of. It's tough to invest in a market you know nothing about. I'd suggest putting at least some of that into a retirement savings account for long term growth. Make sure you look at both your short term and long term goals. Letting an investment mature from age 20 through to retirement will net you plenty of compound interest but don't forget about your short term goals like possible cars, houses and families. Do as much research as you can and you will be fine!


You may want to start a company for a few reasons, the main one would be liability, you don't want your friend to drop a weight on a foot and sue you for millions taking your house away. You'd need to pay taxes on the income, that's after you pay all your expenses, bills, mortgage interest, insurance premiums (!), equipment depreciation. So it's going to be a lot less than you collect from your friends. Whether you incorporate or not you have to pay taxes on your income. If it's $200/year IRS may not notice that, if it's $20K a month it would be very hard to hide. If you pay your friends more than some amount (check the laws) you'd need to tell IRS about it (issue 1099-misc), then your friends must pay taxes on that income.


would buying the stock of a REIT qualify as a 'Like-Kind' exchange? Short answer, no. Long answer, a 1031 (Starker) exchange only applies to real estate.  From the Wikipedia page on the topic: To qualify for Section 1031 of the Internal Revenue Code, the properties exchanged must be held for productive use in a trade or business, or for investment. Stocks, bonds, and other properties are listed as expressly excluded by Section 1031 of the Internal Revenue Code, although securitized properties are not excluded. A REIT, being stock in a real estate company, is excluded from Section 1031.


"There are a number of choices: I prefer Dilip's response ""Have you tried asking etrade?"" No offense, but questions about how a particular broker handles certain situations are best asked of the broker.  Last - one should never enter into any trade (especially options trades) without understanding the process in advance. I hope you are asking this before trading."


">""Those measures all reflect a new way of measuring VaR though, one that switches the model from a four-year look to just one year, removing the rocky years of 2008 and 2009 from the current measure""  VAR is a measure of how much money can be lost in a given time period within certain constraints. For most banks it is the maximum that can be lost within day in a 99% confidence interval. So in layman terms on average only 1 in 100 days will more money be lost than the VAR.   VAR is calculated using historical data. It uses the historical data to build up a profile of scenarios and probability of occurrence. Armed with the knowledge of how much is lost in each of these scenarios and the probability of it occurring a VAR can be estimated. MS have essentially stopped including the last 4 years since they are far more volatile and are only including the last year since it has been relatively calm. It is essentially cheating. It is choosing the data to fit your needs and is statistical heresy."


Because the stock still has the same value as the money paid for it - you are just exchanging one asset for another (of course the stock value starts to change immediately, but for the accounting the fictional value is the buying price). For the accounting, it is similar to changing a 100$ bill in five 20$ bills - same value, still assets.


>But when share repurchases replace a company’s research-and-development spending, that indicates its management is unable or unwilling to spend on innovation that could generate future earnings to shareholders.  I disagree. If we look at buybacks and r&d purely as investments, a shorter term investment is lower in risk and return, while a longer term one is higher in risk. Of course, the same goes for respective returns. Knowing that research-to-market time for a drug is 5-12 years, and that buybacks are almost immediate returns, the 11% difference over ten years seems generous, not greedy.  I've read the same being said about marketing budgets being more than r&d. Again, if the market doesn't have perfect flow of information, marketing become a need to survive. A smart CEO would never spend more on marketing than is necessary. It's the last cost a company bears on a product before booking a sale, and it's the last bite out of the profit.


I did that.  What is allowed changes over time, though — leading up to the crisis, lenders would approve at the flimsiest evidence. In particular, my SO had only been in the country a couple years and was at a sweet spot where lack of history was no longer counting against her. Running the numbers, the mortgage was a fraction of a percent cheaper in her name than in mine.  Even though she used a “stated income” (self reported, not backed by job history) of the household, not just herself. The title was in her name, and would have cost money to have mine added later so we didn’t.  This was in Texas, which is a “community property” state so after marriage for sure everything is “ours”.


For the Roth the earnings: interest, dividends, capital gains distributions and capital gains are tax deferred. Which means that as long as the money stays inside of a Roth or is transferred/rolled over to another Roth there are no taxes due. In December many mutual funds distribute their gains. Let's say people invested in S&P500index fund receive a dividend of 1% of their account value. The investor in a non-retirement fund will be paying tax on that dividend in the Spring with their tax form. The Roth and IRA investors will not be paying tax on those dividends. The Roth investor never will, and the regular IRA investor will only pay taxes on it when they pull the money out.


Wealthsimple lists their prices as follows: Those are the fees you pay over and above what you pay for the underlying ETFs' management fees. But why not just invest in the ETFs yourself? The Canadian Couch Potato website shows some sample portfolios. The ETF option has an average Management Expense Ratio very similar to that of the ETFs used by Wealthsimple, but without the additional management fee. Rebalance once or twice a year and you cut your fees from approximately 0.57% (if investing mid-six-figures) to 0.17%, for very little work. Is it worth it to you? Well, that depends on how much you have to invest, and how much effort you are willing to put in. Wealthsimple isn't particularly unreasonable with their fees, but the fees do look a bit high once you are in to the six figures of investing. On the other hand, I often recommend Tangerine's mutual funds to my friends who are looking at investing for retirement. Those mutual funds, last time I checked, cost 1.09%. That's about twice what Wealthsimple is charging. But they are easy to understand and easy to invest in; a good choice for my friends looking to invest $1,000 - $50,000 in my opinion. So, and understanding this is just my personal opinion, I think Wealthsimple fits in a niche where Tangerine mutual funds carry too high a cost for you, but you don't want to do all the management yourself, even if this is just an hour or so of work, a couple of times a year. I wish they were cheaper, but their pricing makes sense for a lot of people in my opinion. Do they make sense for you? If you are looking at investing less than $10,000, I'd stick with an option like Tangerine, only because that's an easier option. If investing more than $100,000 or $200,000, I think you are paying a bit much for what they offer. But, many people pay much, much, much more for their investments.


I had a coworker whose stock picking skills were clearly in the 1% level. I had a few hundred shares of EMC, bought at $10. When my coworker bought at $80, I quietly sold as it spiked to $100. It then crashed, as did many high tech stocks, and my friend sold his shares close to the $4 bottom advising that the company would go under. So I backed up the truck at $5, which for me, at the time, meant 1000 shares. This was one of nearly 50 trades I made over a good 10 year period. He was loud enough to hear throughout the office, and his trades, whether buy or sell, were 100% wrong.  Individual stocks are very tough, as other posters have offered. That, combined with taking advice from those who probably had no business giving it.  For the record, I am semi-retired. Not from stock picks, but from budgeting 20% of income to savings, and being indexed (S&P) with 90% of the funds.  If there are options on your stock, you might sell calls for a few years, but that's a long term prospect. I'd sell and take my losses. Lesson learned. I hope.


"There is a difference between losing money in the market, and not knowing where the money is. Let's say he invested 2 billion into 1 stock, then that stock drops from $100 per share to $50 per share. Well that is documentable. Corzine claims he doesn't know what happened.   Haven't you ever seen ""It's A Wonderful Life""?"


I use the following method. For each stock I hold long term, I have an individual table which records dates, purchases, sales, returns of cash, dividends, and way at the bottom, current value of the holding. Since I am not taking the income, and reinvesting across the portfolio, and XIRR won't take that into account, I build an additional column where I 'gross up' the future value up to today() of that dividend by the portfolio average yield at the date the dividend is received. The grossing up formula is divi*(1+portfolio average return%)^((today-dividend date-suitable delay to reinvest)/365.25) This is equivalent to a complex XMIRR computation but much simpler, and produces very accurate views of return.  The 'weighted combined' XIRR calculated across all holdings then agrees very nearly with the overall portfolio XIRR. I have done this for very along time.  TR1933 Yes, 1933 is my year of birth and still re investing divis!


"I have seen the notation KTB written on documents in the place where you put an identifying number of some kind. It stands for Known to Branch and means the tellers recognize you. It's been written on documents of mine when I was depositing cheques large enough that someone else had to come and initial the transaction, and I presume that some people might have also had to show extra ID, but I didn't.  Just a month or so ago I was in line behind an old man at a branch where everyone has to put their card in and enter a pin to do transactions. I heard him tell the teller ""I don't have a card. Never did. Don't hold with that."" Another teller came by and said something quietly to the teller (I presume it was ""that's old Mr Smith, we all know him"") and the transaction appears to have taken place without any ID being passed across the counter.  So yes, at least in Canada, if the tellers recognize you, the requirements for ID are less than you might think. It's a bit of a long con to spend 25 years going into a branch and conducting all your business under a particular name, just so you can do a transaction or two without ID, though :-)"


"The company itself doesn't benefit. In most cases, it's an expense as the match that many offer is going to cost the company some percent of salary.  As Mike said, it's part of the benefit package. Vacation, medical, dental, cafeteria plans (i.e. both flexible spending and dependent care accounts, not food), stock options, employee stock purchase plans, defined contribution or defined benefit pension, and the 401(k) or 403(b) for teachers. Each and all of these are what one should look at when looking at ""total compensation"". You allude to the lack of choices in the 401(k) compared to other accounts. Noted. And that lack of choice should be part of your decision process as to how you choose to invest for retirement. If the fess/selection is bad enough, you need to be vocal about it and request a change. Bad choices + no match, and maybe the account should be avoided, else just deposit to the match.  Note - Keith thanks for catching and fixing one typo, I just caught another."


Duration is the weighted average time until all the cash flows of a fixed income security are received. There are a few different measures of duration but generally, duration measures the sensitivity of the price of a fixed income asset to a change in the yield of that asset. If you're familiar with calculus, duration is the first derivative of price with respect to yield.  Convexity is the sensitivity of the duration of bond with respect to changes in yield, or the second derivative.   The first chart [here](http://www.investopedia.com/terms/c/convexity.asp#axzz1x4F075zM) will help. Convexity measures the curvature of the blue or pink line, the steeper the curve the higher the convexity.   The more cash flows there are in a bond (higher or more frequent coupon) the lower the duration, because you are receiving more of your investment earlier as opposed to later (think time value of money). If a bond has one cash flow, meaning you get paid back only at maturity (zero coupon) then any changes in interest rates will have a greater impact on the price of the bond since you are discounting only one cash flow in the future. Think of buying a bond with no coupons and a 5% yield that matures in 5 years, or a bond with similar yield and maturity buy pays a coupon. If interest rates rise, the zero coupon bond's price will fall more than the bond with coupons. Why? Because if you own the zero coupon bond you have to wait 5 years to get your money back and reinvest it at the higher rate, while if you have the bond that pays coupons you can reinvest those incremental cash flows at the higher rate, even though at purchase they had the same yield and maturity.  These are both tough concepts that took me a fair amount of time to really understand. If you're investing in bonds or any fixed income asset, these topics are crucial to understanding interest rate risk.


Yes, Lending Club is the biggest of the bunch, which to date have helped originate $1B of loans. LC just raised more money (bringing total to $100M) and Mary Meeker joined the board. There's a novelty aspect to it b/c it's new but it's just the beginning of parts of the banking industry/process/institutions being disintermediated.   Low vol is an easy sell, actually. If investors aren't being paid for risk, why assume it?


Interactive Brokers advertises the percent of profitable forex accounts for its own customers and for competitors. They say they have 46.9% profitable accounts which is higher than the other brokers listed. It's hard to say exactly how this data was compiled- but I think the main takeaway is that if a broker actually advertises that most accounts lose money, it is probably difficult to make money. It may be better for other securities because forex is considered a very tough market for retail traders to compete in.  https://www.interactivebrokers.com/en/?f=%2Fen%2Ftrading%2Fpdfhighlights%2FPDF-Forex.php


"at $8.50:  total profit = $120.00 *basis of stock, not paid in cash, so not included in ""total paid"" at $8.50: total profit = $75.00"


From the letter you link: Our performance, relatively, is likely to be better in a bear market than in a bull market so that   deductions made from the above results should be tempered by the fact that it was the type of year when we   should have done relatively well. In a year when the general market had a substantial advance I would be well   satisfied to match the advance of the Averages. Putting those two sentences together, the word relatively means that his funds perform better than the market in bear markets and perform about the same as the overall market in bull markets. It does not mean that absolute performance is better in bear markets than bull markets. Later on he states  This policy should lead to superior results in bear markets and average performance in bull markets.


Sorry for your loss. Like others have said Debts cannot be inherited period (in the US). However, assets sometimes can be made to stand for debts. In most cases, credit card debt has no collateral and thus the credit card companies will often either sell the debt to a debt collector or collections agency, sue you for it, or write it off. Collecting often takes a lot of time and money, thus usually the credit card companies just sell the debt, to a debt collector who tries to get you to pay up before the statute of limitations runs out. That said, some credit card companies will sue the debtor to obtain a judgement, but many don't. In your case, I wouldn't tell them of your loss, let em do their homework, and waste time. Don't give them any info,and consult with a lawyer regarding your father's estate and whether his credit card will even matter. Often, unscrupulous debt collectors will say illegal things (per the FDCPA) to pressure anyone related to the debtor to pay. Don't cave in. Make sure you know your rights, and record all interactions/calls you have with them. You can sue them back for any FDCPA infractions, some attorneys might even take up such a case on contingency, i.e they get a portion of the FDCPA damages you collect. Don't pay even a penny. This often will extend or reset the statute of limitations time for the debt to be collectable. i.e Ex: If in your state, the statute of limitations for credit card debt is 3 years, and you pay them $0.01 on year 2, you just bought them 3 more years to be able to collect. TL;DR: IANAL, most credit card debt has no collateral so don't pay or give any info to the debt collectors. Anytime you pay it extends the statute of limitations. Consult an attorney for the estate matters, and if the debt collectors get too aggressive, and record their calls, and sue them back!


Withdrawing from your 401(k) may include a 10% withdrawal penalty. There are ways to avoid the withdrawal penalty for early disbursements. The idea is to reduce your interest expense by leveraging free loans (0% APR purchases). This will help you pay down your debt more.  If you have 0% APR on purchases, you can make purchases on things you already buy. Then use that money towards other debt, while making monthly payments on the 0% APR card. This way, you pay off the credit card before the 0% APR changes. You can then rinse and repeat on another 0% APR card offer. If your credit score is 800, you can do this multiple times. Citi Simplicity gives you 18 months 0% APR. Chase Slate and Chase Freedom gives you 15 months 0% APR. Others typically give you 12 months or less.


I've kind of been there myself.  I stretched my finances for the deposit on a house, and lived off my credit card for a few months to build up what I was short on the deposit.  Add some unexpected car repairs, and I ended up with £10k on the card.  The problem I had then was that interest on the card ran at around 20%, and although I could meet the interest payments I couldn't clear the £10k. I simply went and talked to my bank.  In the UK there are some clear rules about banks giving customers a chance to restructure their debts.  That's the BANK doing it, not some shady loan-shark.  We went through my finances and established that in principle it was repayable.  So I got a 2-year unsecured loan at around 5%, cleared the card, and spent the next 2 years paying off a loan that I could afford.  My credit score is still aces. Forget the loan-sharks.  Talk to your bank.  If they're crap, talk to another bank.  If no bank is going to help you, consider bankrupcy as per advice above.  Debt restructuring companies are ALWAYS a con, no exceptions.


"Whether you do decide to go with a tax advisor or not, be sure to do some research on your own. When we moved to the US about 5 years ago, I did find the taxes here pretty complicated and confusing.  I went ahead and read up all different tax documents and did some calculations of my own before hiring a CPA (at that point, I just wanted a second opinion to make sure I got the calculations right). However, when the office of the CPA was finished with my taxes, I found they had made a mistake! When I went back to their office to point it out, the lady just shrugged, corrected her numbers on the form and said ""You seem to know a lot about this stuff already. Why are you here?"" I swore to never use them again - not this particular CPA at least. Now, I am not saying all CPAs are the same - some of them are pretty darn good at their job and know what they are doing. All I am saying is it helps to be prepared and know some basic stuff. Just don't go in all blind.  After all, they are also humans prone to mistakes and your taxes are your liability in the end.  My suggestion is to start with a good tool that supports tax filing for non-residents. Most of them provide a step-by-step QA based tool. As you go through the steps, Google each question you don't understand. It may take more time than hiring a tax advisor directly but in the end it will all be worth it."


"Auto loans are secured agains the car.  ""Signature"" loans, from a bank that knows and trusts you, are typically unsecured. Unsecured loans other than informal ones or these are fairly rare. Most lenders don't want to take the additional risk, or balance that risk with a high enough interest rate to make the unsecured loan unattractive."


"Unless you can make an agreement with your landlord, your credit is on the bubble in this situation and it may be difficult to get the landlord to void the terms of the original agreement in lieu of a new one. I was burned by a similar situation when I was in college. I rented an apartment with my then ""best friend"". I sent my half of the rent in on time and he consistently skipped out on his. My credit took a blow to the tune of the shared liability just the same. Seriously seek to work something out with the landlord because it sounds like if things continue as they are, whether you move out or not, your credit will take a hit."


If you exceed the income limit for deducting a traditional IRA (which is very low if you are covered by a 401(k) ), then your IRA options are basically limited to a Roth IRA. The Cramer person probably meant to compare 401(k) and IRA from the same pre-/post-tax-ness, so i.e. Traditional 401(k) vs. Traditional IRA, or Roth 401(k) vs. Roth IRA. Comparing a Roth investment against a Traditional investment goes into a whole other topic that only confuses what is being discussed here. So if deducting a traditional IRA is ruled out, then I don't think Cramer's advice can be as simply applied regarding a Traditional 401(k). (However, by that logic, and since most people on 401(k) have Traditional 401(k), and if you are covered by a 401(k) then you cannot deduct a Traditional IRA unless you are super low income, that would mean Cramer's advice is not applicable in most situations. So I don't really know what to think here.)


Yes, if you can split your income up over multiple years it will be to your advantage over earning it all in one year.  The reasons are as you mentioned, you get to apply multiple deductions/credits/exemptions to the same income. Rather than just 1 standard deduction, you get to deduct 2 standard deductions, you can double the max saved in an IRA, you benefit more from any non-refundable credits etc. This is partly due to the fact that when you are filing your taxes in Year 1, you can't include anything from Year 2 since it hasn't happened yet. It doesn't make sense for the Government to take into account actions that may or may not happen when calculating your tax bill. There are factors where other year profit/loss can affect your tax liability, however as far as I know these are limited to businesses. Look into Loss Carry Forwarded/Back if you want to know more. Regarding the '30% simple rate', I think you are confusing something that is simple to say with something that is simple to implement.  Are we going to go change the rules on people who expected their mortgage deduction to continue? There are few ways I can think of that are more sure to cause home prices to plummet than to eliminate the Mortgage Interest Deduction. What about removing Student Loan Interest? Under a 30% 'simple' rate, what tools would the government use to encourage trade in specific areas? Will state income tax deduction also be removed? This is going to punish those in a state with a high income tax more than those in states without income tax. Those are all just 'common' deductions that affect a lot of people, you could easily say 'no' to all of them and just piss off a bunch of people, but what about selling stock though? I paid $100 for the stock and I sold it for $120, do I need to pay $36 tax on that because it is a 'simple' 30% tax rate or are we allowing the cost of goods sold deduction (it's called something else I believe when talking about stocks but it's the same idea?) What about if I travel for work to tutor individuals, can I deduct my mileage expenses? Do I need to pay 30% income tax on my earnings and principal from a Roth IRA? A lot of people have contributed to a Roth with the understanding that withdrawals will be tax free, changing those rules are punishing people for using vehicles intentionally created by the government. Are we going to go around and dismantle all non-profits that subsist entirely on tax-deductible donations? Do I need to pay taxes on the employer's cost of my health insurance? What about 401k's and IRA's? Being true to a 'simple' 30% tax will eliminate all 'benefits' from every job as you would need to pay taxes on the value of the benefits. I should mention that this isn't exactly too crazy, there was a relatively recent IRS publication about businesses needing to withhold taxes from their employees for the cost of company supplied food but I don't know if it was ultimately accepted. At the end of the day, the concept of simplifying the tax law isn't without merit, but realize that the complexities of tax law are there due to the complexities of life. The vast majority of tax laws were written for a reason other than to benefit special interests, and for that reason they cannot easily be ignored.


Ok so Arbitrage?  I was looking specifically at the people who took this deal to the extreme taking the $5k and using the $10 giftcards to buy prepaid credit cards.  Would the better term would be positive-feedback loop, since the only constraint would be time and energy to the people exploit this deal.  Is there a financial term that fits this better?


"I don't think its a taxable event since no income has been constructively received (talking about the RSU shareholders here). I believe you're right with the IRC 1033, and the basis of the RSU is the basis of the original stock option (probably zero). Edit: see below. However, once the stock becomes vested - then it is a taxable event (not when the cash is received, but when the chance of forfeiture diminishes, even if the employee doesn't sell the stock), and is an ordinary income, not capital. That is my understanding of the situation, do not consider it as a tax advice in any way. I gave it a bit more though and I don't think IRC 1033 is relevant. You're not doing any exchange or conversion here, because you didn't have anything to convert to begin with, and don't have anything after the ""conversion"". Your ISO's are forfeited and no longer available, basically - you treat them as you've never had them. What happened is that you've received RSU's, and you treat them as a regular RSU grant, based on its vesting schedule. The tax consequences are exactly as I described in my original response: you recognize ordinary income on the vested stocks, as they vest. Your basis is zero (i.e.: the whole FMV of the stock at the time of vesting is your ordinary income). It should also be reflected in your W2 accordingly."


In general, the better advice I've heard is to spend only on things that matter to you and scrimp on the rest. It's an easy way to budget without having to stick to a strict set of rules. Otherwise keep 3-6 months of living expenses in liquid accounts (money market, savings) and invest the rest.


">Those ""resources"" are often employees  Yes labor is also a scarce resource. But just like other resources it needs to be used in a way that is most productive. If the govt spends $100k hiring two people to dig holes and then refill them, those two people are employed, but there is no production there. That $100k contributed to no productive growth and created no wealth for anyone. The two businessmen who did not get loans for their business would have to seek employment with another entrepreneur who could put their labor to more productive use.   >No, only the base rate is set centrally.  Exactly, but the bank's rates are reliant on the federal funds rate"


I have ScottradeElite on my desktop. I have played around with it but no longer use it. The transactions that I make through Scottrade are more dependent on my goals for the securities than what the market is doing at the moment.  Keep in mind that there will always be others out there with better access to price changes than you. They also will have better hardware. We cannot beat them at their game.


It depends on the sequence in which the order [bid and ask] were placed. Please read the below question to understand how the order are matched. How do exchanges match limit orders?


"A ""true"" 0% loan is a losing proposition for the bank, that's true.  However when you look at actual ""0%"" loans they usually have some catches: There might also be late payment fees, prepayment penalties, and other clauses that make it a good deal on average to the bank.  Individual borrowers might be able to get away with ""free money"", but the bank does not look to make money on each loan, they look to make money on thousands of loans overall. For a retailer (including new car sellers). the actual financing costs will be baked into the sales price.  They will add, say, 10% to the sales price in exchange for an interest-free loan. They can also sell these loans to an investment bank or other entity, but they would be sold at a deep discount, so the difference will be made up in the sales price or other ""fees"". It's possible that they would just chalk it up to promotional discounts or customer acquisition costs, but it would not be a good practice on a large scale."


I would say you are typical.  The way people are able to build their available credit, then subsequently build their average balances is buy building their credit score.  According to FICO your credit score is made up as follows: Given that you had no history, and only new credit you are pretty much lacking in all areas.  What the typical person does, is get a card, pay on it for 6 months and assuming good history will either get an automatic bump; or, they can request a credit limit increase. Credit score has nothing to do with wealth or income.  So even if you had 100K in the bank you would likely still be facing the same issue.  The bank that holds the money might make an exception. It is very easy to see how a college student can build to 2000 or more.  They start out with a $200 balance to a department store and in about 6 months they get a real CC with a 500 balance and one to a second department store.  Given at least a decent payment history, that limit could easily increase above 2500 and there could be more then one card open.   Along the lines of what littleadv says, the companies even welcome some late payments.  The fees are more lucrative and they can bump the interest rate.  All is good as long as the payments are made. Getting students and children involved with credit cards is a goal of the industry.  They can obtain an emotional attachment that goes beyond good business reasoning.


The problem is very fundamental. Equity is traded on limit order books while fixed income is not. Meaning counterparty to counterparty, if you buy a bond off say barclays, chances are if you hit them for a price to sell it will be somewhat higher than the market as they do not want you to just take their money.  Putting fixed income on a limit order book could help however there may be fundamental liquidity problems on some smaller issues.


Is the pay cycle every 2 weeks? So 30% each two week period is 1.3^26 = 917.33 or an APR of 91633%.  Loansharks charge less, I believe standard vig was 2%/week for good customers. Only 180% per year.


As a dutch guy having lived in Canada for some time, and went down the the states a lot; I was extremely surprised how outdated your banking technology is.  A lot of mutations require me to physically visit a bank (often my specific branch), and I couldn't believe it when I saw that people still use cheques. Before I moved, I just remembered them from my very early childhood.  Get your shit together North America :)


So, my question is what is the limit below which I don't have to pay taxes while trading. I just invested $10. Do I have to pay taxes for this too? what are the slabs? Any income is subject to tax. That said, investing $10 will probably not generate much of income, even at the discount brokers most of it will be wasted on commissions... I am also having an assistantship. So is holding two sources of income legitimate? Thanks You can have as many sources of income as you want. Working is what is restricted when you're on a student visa. As long as you don't open a business as a day trader or start working for someone trading stocks - you're fine.


"That share class may not have a ticker symbol though ""Black Rock MSCI ACWI ex-US Index"" does have a ticker for ""Investor A"" shares that is BDOAX.  Some funds will have multiple share classes that is a way to have fees be applied in various ways.  Mutual fund classes would be the SEC document about this if you want a government source within the US around this. Something else to consider is that if you are investing in a ""Fund of funds"" is that there can be two layers of expense ratios to consider.  Vanguard is well-known for keeping its expenses low."


You can keep your Mutual Funds. You have to communicate your new status to fund house.  The SIP can continue. Please note you have to convert the savings account to NRO account. Most banks would keep the account number same, else you have to revise SIP debit to new NRO account. From a tax point of view, it would be similar to resident status. Right now short term gains are taxed. There are quite a few other things you may need to do. Although dated, this is a good article. PS: Once you become resident alien in US for tax purposes, you are liable for taxes on global income.


"It can be difficult when all your disposable income is spoken for.  Your options depend on how good your credit is and how flexible your expenses are.  I don't have all the answers without more details (possibly not then).  However, couple of points of advice: Paying off that credit card debt (and not adding any more to it) is your #1 priority.  You should make minimum payments to every other debt until you have done that because the interest on it will kill you in the mean time.  It is always optimal to pay the maximum to your highest interest debt and minimum to all other debts. 11% doesn't sound very good on your house loan.  You may want to consider refinancing.  That is, if you can get a lower rate.  You may also want to get a longer term loan (if you have enough discipline to use the extra income to actually pay off your credit card and then the put it toward the house when the cards are paid off). Look at options to increase your income, at least temporarily.  Second jobs and such.  When your finances are more in order, you can back off. The debt ""trap"" is behavioral.  We humans tend to increase our spending until we can't any more.  But the reason we can't spend any more is that we have increased our debt until we have no flexible income.  Then we are stuck for a long time and have few options. The only way out (long term) is to change our habits so that we don't increase spending each time we pay down a debt or get an increase to our income.  Financial discipline is the only way to have financial security.  Almost always the first step is to pay off credit cards and stop maintaining a balance (always pay off every card at the end of each month).  Then start paying off other debts from highest interest rate to lowest. This is a hard challenge and one most of us face at some point in our lives.  Good luck!"


"A few points Yes, as a rule, it is better to pay down high interest accounts first, as this will yield lower cost in the long run. Credit card balance transfers usually come at a cost (typically something like ""3% or $50, whichever is higher"").  So instead of transferring the debt, maybe try purchasing items with your card instead of cash, and using the cash to pay down the debt.  This has the added benefit of giving you points or cash back on the card (typically you won't get these for a balance transfer). Caveat: Only do this if you are very disciplined!  It is very easy to run up high CC balances and forget to save the cash. You should leave a bit of unused credit line on your credit cards in case of emergencies.  I'm doubting you can use your high interest loans in the same way."


The short answer is no you can only deduct actual expenses. The long answer is that it would be impossible for the IRS to determine the value of your time and it would open the tax system to an enormous amount of fraud (think of being able to make up time spent or writing off time spent volunteering at a soup kitchen or any other charity). Now you can write off expenses you have involved in doing the work, equipment and supplies used to do the work along with any wages you paid an employee or contractor to do said work.


"Does her dad still have the records from those tax years? If so, I would suggest using those as a basis and if they're complete, just filing them directly. If we're talking about software recommendations, I would suggest GenuTax as it allows for completing returns all the way back to 2003 without buying separate versions. Alternatively, there are some no-cost options. See the Wikipedia entry Comparison of Canadian-tax preparation software for personal use. Look both at the ""Price"" column and at the ""Freebies"" column. You should start at 2006 and move forward so you can keep track of carry-forward amounts. I'm assuming your girlfriend had no balance owing from those years as she was a student so there's no penalty to worry about."


"Well, it's directly depositing money in your account, but Direct Deposit is something completely different: https://en.wikipedia.org/wiki/Direct_deposit Direct deposits are most commonly made by businesses in the payment of salaries and wages and for the payment of suppliers' accounts, but the facility can be used for payments for any purpose, such as payment of bills, taxes, and other government charges. Direct deposits are most commonly made by means of electronic funds transfers effected using online, mobile, and telephone banking systems but can also be effected by the physical deposit of money into the payee's bank account. Thus, since the purpose of DD is to eliminate checks, I'd say, ""no"", depositing cash directly into your account does not count as the requirement for one Direct Deposit within 90 days."


The $10,000 is not taxable to either of you, but the $500 is taxable income to you - and a deductible business expense for your friend.


"The article ""Best Stock Fund of the Decade: CGM Focus"" from the Wall Street Journal in 2009 describe the highest performing mutual fund in the USA between 2000 and 2009. The investor return in the fund (what the shareholders actually earned) was abysmal. Why? Because the fund was so volatile that investors panicked and bailed out, locking in losses instead of waiting them out. The reality is that almost any strategy will lead to success in investing, so long as it is actually followed. A strategy keeps you from making emotional or knee-jerk decisions. (BTW, beware of anyone selling you a strategy by telling you that everyone in the world is a failure except for the few special people who have the privilege of knowing their ""secrets."") (Link removed, as it's gone dead)"


How and why is this considered fair (and/or legal)? Let's use an analogy.  The issue is not fairness, it is just the rules. The assets you own and the cash you receive are reported differently. If the rules don't make sense, I suggest you hire an adviser that can teach you and help you get the most out of your investments.


I'm a CPA and former IRS agent and manager. Whether you are a cash or accrual basis taxpayer, you get to deduct the expense when your card is charged. Think of it this way: You are borrowing from the credit card company or bank that issued the credit card. You take that money to make a purchase of a product or service. You now have an expense and a liability to a third party. When you pay off the liability, you do not get to take a deduction. Your deduction is when you pay for the expense. Depending on what you purchased, you may have to capitalize it.


"I'm not sure if the rules in Canada and the US are the same. I'm as amazed as you are by the amounts of debts people have, but I can see how this credit can be extended. Generally, with good credit history and above average pay - it is not unheard of to get about $100K credit limit with a bunch of credit cards. What you do with that after that depends on your own ability to manage your finances and discipline. Good credit history is defined by paying your credit cards on time with at least minimum payment amount (which is way lower than the actual statement amount). Above average pay is $60K+. So you can easily have tons of debt, yet be considered ""low risk"" with good credit history. And that's the most lucrative market for the credit card issuers - people who do not default, but also have debt and pay interest."


In fact, buybacks WERE often considered a vehicle for insider trading, especially prior to 1982.  For instance, Prior to the Reagan era, executives avoided buybacks due to fears that   they would be prosecuted for market manipulation. But under SEC Rule   10b-18, adopted in 1982, companies receive a “safe harbor” from market   manipulation liability on stock buybacks if they adhere to four   limitations: not engaging in buybacks at the beginning or end of the   trading day, using a single broker for the trades, purchasing shares   at the prevailing market price, and limiting the volume of buybacks to   25 percent of the average daily trading volume over the previous four   weeks.


Does your employer provide a matching contribution to your 401k?  If so, contribute enough to the 401k that you can fully take advantage of the 401k match (e.g. if you employer matches 3% of your income, contribute 3% of your income).  It's free money, take advantage of it. Next up, max out your Roth IRA.  The limit is $5000 currently a year. After maxing your Roth, revisit your 401k.  You can contribute up to 16,500 per year. You savings account is a good place to keep a rainy day fund (do you have one?), but it lacks the tax advantages of a Roth IRA or 401k, so it is not really suitable for retirement savings (unless you have maxed out both your 401k and Roth IRA). Once you have take care of getting money into your 401k and Roth IRA accounts, the next step is investing it.  The specific investment options available to you will vary depending on who provides your retirement account(s), so these are general guidelines. Generally, you want to invest in higher-risk, higher-return investments when you are young.  This includes things like stocks and developing countries. As you get older (>30), you should look at moving some of your investments into things that less volatile.  Bond funds are the usual choice.  They tend to be safer than stocks (assuming you don't invest in Junk bonds), but your investment grows at a slower rate. Now this doesn't mean you immediately dump all of your stock and buy bonds.  Rather, it is a gradual transition over time.  As you get older and older, you gradually shift your investments to bond funds. A general rule of thumb I have seen: 100 - (YOUR AGE) = Percentage of your portfolio that should be in stocks Someone that is 30 would have 70% of their portfolio in stock, someone that is 40 would have 60% in stock, etc. As you get closer to retirement (50s-60s), you will want to start looking at investments that are more conservatie than bonds.  Start to look at fixed-income and money market funds.


In a comment on this answer you asked  It's not clear to me why the ability to defer the gains would matter (since you never materially benefit until you actually sell) but the estate step up in basis is a great point! Could you describe a hypothetical exploitive scenario (utilizing a wash sale) in a little more detail?  This sounds like you still have the same question as originally, so I'll take a stab at answering with an example.   I sell some security for a $10,000 profit.  I then sell another security at a $10,000 loss and immediately rebuy.  So pay no taxes (without the rule).  Assuming a 15% rate, that's $1500 in savings which I realize immediately.  Next year, I sell that same security for a $20,000 profit over the $10,000 loss basis (so a $10,000 profit over my original purchase).  I sell and buy another security to pay no taxes.  In fact, I pay no taxes like this for fifty years as I live off my investments (and a pension or social security that uses up my tax deductions).  Then I die.  All my securities step up in basis to their current market value.  So I completely evade taxes on $500,000 in profits.  That's $75,000 in tax savings to make my heirs richer.  And they're already getting at least $500,000 worth of securities.   Especially consider the case where I sell a privately held security to a private buyer who then sells me back the same shares at the same price.   Don't think that $10,000 is enough?  Remember that you also get the original value.  But this also scales.  It could be $100,000 in gains as well, for $750,000 in tax savings over the fifty years.  That's at least $5 million of securities.   The effective result of this would be to make a 0% tax on capital gains for many rich people.   Worse, a poorer person can't do the same thing.  You need to have many investments to take advantage of this.  If a relatively poor person with two $500 investments tried this, that person would lose all the benefit in trading fees.  And of course such a person would run out of investments quickly.   Really poor people have $0 in investments, so this is totally impractical.


VALIS Group Inc a new business on your own and defaulting on incorporating your business or being sued by a customer. Instead of being excited to start a new business, you will face difficulties as your personal assets could be taken away for fulfilling business expenses. However, if Incorporating your business, this nightmare can stay far away from you, as it alleviates personal liability as well as guards you as the corporate owner. also, has very friendly laws to incorporate a company and may require minimum documents and time period to complete company registration.


OK, VERY glad you get that idea!  The problem with the ETF is: it's the monkeys-throwing-darts method. If the average (dollar-weighted) member stock in the ETF goes up, you win, but if half of them go under, and half succeed, over some time periods you will lose (and win over others).  I guess my POV is: if you can't do serious research into the expected success of an individual company, maybe it's too risky to even try betting on the whole group. YMMV. The problem with your investment plan is: you are depending on luck, and the assumption the group will increase in value over your investment period. I prefer research over hope.


If this activity were to generate let's say 100K of profit, and the   other corporate activities also generate 100K of revenue, are there   any issues tax-wise I need to be concerned about? Yes. Having 25% or more of passive income in 3 consecutive years will invalidate your S-Corp status and you'll revert to C-Corp. Can I deduct normal business expenses from the straddles (which are   taxed as short term capital gains) profit? I don't believe you can. You can deduct investment expenses from the investment income. On your individual tax return it will balance out, but you cannot mix types of income/expense on the corporate return or K-1.


Generally speaking, an interest-free loan will be tied to a specific purchase, and the lender will be paid something by the vendor. The only other likely scenario is an introductory offer to try to win longer-term more profitable business, such as an initial interest-free period on a credit card. Banks couldn't make money if all their loans were interest-free, unless they were getting paid by the vendors of whatever was being purchased with the money that was lent.


While debt increases the likelihood and magnitude of a crash, speculation, excess supply and other market factors can result in crashes without requiring excessive debt. A popular counter example of crashes due to speculation is 16th century Dutch Tulip Mania.  The dot com bubble is a more recent example of a speculative crash. There were debt related issues for some companies and the run ups in stock prices were increased by leveraged traders, but the actual crash was the result of failures of start up companies to produce profits. While all tech stocks fell together, sound companies with products and profits survive today. As for recessions, they are simply periods of time with decreased economic activity. Recessions can be caused by financial crashes, decreased demand following a war, or supply shocks like the oil crisis in the 1970's. In summary, debt is simply a magnifier. It can increase profits just as easily as can increase losses. The real problems with crashes and recessions are often related to unfounded faith in increasing value and unexpected changes in demand.


You forgot the biggest thing: Japan still controls its own currency and Greece does not.   If you don't control your currency, you have much more limited options when it comes to borrowing money. It is why US states can't borrow a lot of money, they all have to share the US dollar which no one state controls. So states are used to making cutbacks in hard times, but the Eurozone nations have not adopted this mindset.  Greece isn't in trouble because it borrowed too much, it's in trouble because it borrowed so much *and has to share the Euro*. Greece can't inflate its currency, so if they can't make a payment they default, no one wants to lend to a place that might default. If Greece had its own currency still there would be no currency crisis in Europe, just some inflation.


Let me answer with an extreme example - I own the one single share of a company, and it's worth $1M. I issue 9 more shares, and find 9 people willing to pay $1M for each share. I know find my ownership dropped by 90%, and I am now a 10% owner of a business that was valued at $1M but with an additional $9M in the bank for expansion. (Total value now $10M) Obviously, this is a simplistic view, but no simpler than the suggestion that your company would dilute its shares 90% in one transaction.


Almost all major no-load mutual fund families allow you to do the kind of thing you are talking about, however you may need an initial investment of between $1000 to $3000 depending on the fund.  Once you have it however, annual fee's are usually very little, and the fees to buy that companies funds are usually zero if it's a no-load company (Vanguard, TRowPrice, etc)  With the larger companies that means you have a pretty large selection of funds, but generally EACH fund has a minimum initial purchase, once that's met then you can buy additional amounts in small quantities without a problem. For someone on a smaller budget, many low cost brokers (ETrade as mentioned by Litteadv, Scottrade as mentioned by myself in another similar question today) allow you to start with smaller initial balances and have a small selection of funds or ETF's that you can trade from without commission.  In the case of Scottrade, they have like 15 ETF's that you can trade comission free.  Check with the various low cost brokerages such as ETrade, Scottrade, and TDAmeritrade, to see what their policies are, and what if any funds/ETF's they allow you to trade in without commissions. Keep in mind that for Mutual funds, there may still be a fund minimum initial investment that applies, be sure to check if that is the case or not.  The lack of any minimum investment makes ETF's a slightly more attractive option for someone who doesn't have the 'buy in' that many funds require.


And it all depends what you are advertising. We target business owners and startups. I have yet to see a millennial as a client of ours.   Our CFO also pointed out some research found on LinkedIn pitying millenials unable to afford housing. Their age and choice living with parents is much larger by contrast, compared with previous generations. Many millenials wont pay rent, not because they can't, but they blow that money elsewhere for example on entertainment, electronic, or food they like as opposed to cooking, etc. so of course they can't. They learn their financial advice from each other. In some cases their word of mouth interaction with each other is depriving them more than the boomer paranoia spread has deprived baby boomers from taking certain risks.


Fractional shares don't occur from Dividend Reinvestment Programs - residual credit is carried over until there is enough to purchase a whole share.


"Let's say you see a café. You're looking to buy a café so you walk into one and ask the manager how much profit he makes in a year. He says $N and you walk out and think to yourself, ""I'd be willing to pay $500,000 for this café."" You arrange to meet again to discuss purchasing the business (and he's looking for someone to purchase it).  You go into the store again the following day and the manager says, ""Sorry, I told you we make $N. I've checked the numbers and it's actually only $0.8N (20% lower than what you thought)."" Are you still willing to buy the café for $500,000 as well? No, of course you're not.  I think that this is a sufficient analogy to public companies."


"Be mindful of your reporting requirements. Besides checking the box on Schedule B of your 1040 that you have a foreign bank account, you also need to file a TD F 90-22.1 FBAR report for any year that the total of all foreign bank accounts reaches a value of $10,000 at any time during the year. This is filed separately from your 1040 by June 30 of the following year. Penalties for violating this reporting requirement are draconian, in some cases exceeding the amount of money in the foreign bank account. This penalty has been levied on people who have been reporting and paying tax on the interest on their foreign bank accounts, and merely neglected this separate report filing. Article on the ""shoot the jaywalker"" punitive enforcement policy. http://www.rothcpa.com/archives/006866.php Mariette IRS Circular 230 Notice: Please note that any tax advice contained in this communication is not intended to be used, and cannot be used, by anyone to avoid penalties that may be imposed under federal tax law. EDITED TO ADD"


In the real world, there are only two times you'll see that 5% become worth anything - ie, something you can exchange for cash - 1) if another company buys them; (2) if they go public. If neither of these things happen, you cannot do anything with the stock or stock options that you own.


Businesses you are already established with may do a soft pull to pre-qualify you for an offer.  They store the information and if you accept, may instantly setup and account.  You may also see language to the effect that they may do an inquiry (hard pull) - I guess if their data is old.  When you went outside of Amazon to Chase, they did a hard pull on their side which is what you saw.


The changes to Equity given are: Since the total change is 42,500, the difference would be change in Retained Earnings (net income), so net income is


Construction loans have an entirely set of rules and factors than mortgages and that's hard to reconcile into one instrument.  Also, I'm guessing the bank would be a bit shy about giving a commitment to a home loan before they have any information about how the construction process is going.  There would have to be a ton of contingencies put into mortgage and they probably can't account for everything.


"This is the best tl;dr I could make, [original](https://asia.nikkei.com/Markets/Commodities/China-sees-new-world-order-with-oil-benchmark-backed-by-gold?page=1) reduced by 93%. (I'm a bot) ***** > The contract could become the most important Asia-based crude oil benchmark, given that China is the world&#039;s biggest oil importer.  > &quot;It is a mechanism which is likely to appeal to oil producers that prefer to avoid using dollars, and are not ready to accept that being paid in yuan for oil sales to China is a good idea either,&quot; Macleod said.  > Yuan oil futures are expected to attract interest from investors and funds, while state-backed oil majors, such as PetroChina and China Petroleum & Chemical will provide liquidity to ensure trade.   ***** [**Extended Summary**](http://np.reddit.com/r/autotldr/comments/70lu5h/china_announces_the_backing_of_the_yuan_by_gold/) | [FAQ](http://np.reddit.com/r/autotldr/comments/31b9fm/faq_autotldr_bot/ ""Version 1.65, ~211390 tl;drs so far."") | [Feedback](http://np.reddit.com/message/compose?to=%23autotldr ""PM's and comments are monitored, constructive feedback is welcome."") | *Top* *keywords*: **oil**^#1 **China**^#2 **Saudi**^#3 **yuan**^#4 **gold**^#5"


SPX options are cash settled European style.  You cannot exercise European style options before the expiration date.  Assuming it is the day of expiration and you own 2,000 strike puts and the index settlement value is 1,950 - you would exercise and receive cash for the in the money amount times the contract multiplier.  If instead you owned put options on the S&P 500 SPDR ETF (symbol SPY) those are American style, physically settled options.  You can exercise a long American style option anytime between when your purchase it and when it expires.    If you exercised SPY puts without owning shares of SPY you would end up short stock at the strike price.


I would suggest you rollover your Roth 401k to a Roth IRA.  Then pay off your debt before investing anymore money. In the long run you will be better off to have all your debt paid off. But I would not withdraw from the Roth 401k to pay down your debt. The penality is too steep.


If you want to be safe, only claim deductions for which you have a receipt. This explanation may help.


"There are two issues. The first is that you can manage all of your family's money. The second issue arises if you now ""own"" all of your family's money. As far as entities go, it is best to keep money or assets in as many different hands as possible. Right now, if someone sued you and won, they could take away not only your money, but your parents' and brother's money, under your name. Also, there are gift, estate and inheritance tax consequences to your parents and brother handing all their money to you. You should have three or four separate ""piles"" of money, one for yourself, one for your brother and one for each of your parents, or at least both of them as a couple. If someone sued one parent, the other parent, your brother and you are protected. You can have all these piles of money under your management. That is, your parents and brother should each maintain separate brokerage accounts from yours, and then give you the authorization to trade (but not withdraw from) their accounts. This could all be at the same brokerage house, to make the reporting and other logistics relatively easy."


From an Indian perspective, this is what I would do. This typically would not only keep your credit score healthy but also give you additional benefits on spends.


"In general, yes. If interest rates go higher, then any existing fixed-rate bonds - and hence ETFs holding those bonds - become less valuable. The further each bond is from maturity, the larger the impact. As you suggest, once the bonds do mature, the fund can replace them at a market price, so the effect tails off. The bond market has a concept known as ""duration"" that helps reason about this effect. Roughly, it measures the average time from now to each payout of the bond, weighted by the payout. The longer the duration, the more the price will change for a given change in interest rates. The concept is just an approximation, and there are various slightly different ways of calculating it; but very roughly the price of a bond will reduce by a percentage equal to the duration times the increase in interest rates. So a bond with a duration of 5 years will lose 5% of its value for a 1% rise in interest rates (and of course vice-versa). For your second question, it really depends on what you're trying to achieve by diversifying - this might be best as a different question that gives more detail, as it's not very related to your first question. Short-term bonds are less risky. But both will lose value if the underlying company is in trouble. Gilts (government bonds) are less risky than corporate bonds."


"Property sold at profit is taxed at capital gains rate (if you held it for more than a year, which you have based on your previous question). Thus deferring salary won't change the taxable amount or the tax rate on the property. It may save you the 3% difference on the salary, but I don't know how significant can that be. The 25% depreciation recapture rate (or whatever the current percentage is) is preset by your depreciation and cannot be changed, so you'll have to pay that first. Whatever is left above it is capital gains and will be taxed at discounted rates (20% IIRC). You need to make sure that you deduct everything, and capitalize everything else (all the non-deductible expenses and losses with regards to the property). For example, if you remodeled - its added to your basis (reduces the gains). If you did significant improvements and changes - the same. If you installed new appliances and carpets - they're depreciated faster (you can appropriate part of the sale proceeds to these and thus reduce the actual property related gain). Also, you need to see what gain you have on the land - the land cannot be depreciated, so all the gain on it is capital gain. Your CPA will help you investigating these, and maybe other ways to reduce your tax bill. Do make sure to have proper documentation and proofs for all your claims, don't make things up and don't allow your CPA ""cut corners"". It may cost you dearly on audit."


a smaller spread indicates a flat yield curve, which means banks and investors are uncertain about future economic conditions (like the current environment).   When the spread widens and the curve becomes upward sloping (considered a normal yield curve), investors expect future growth and minimal inflation. Longer term rates increase as investors demand a higher yield in return for lending their money for a longer period of time. Increase demand for credit (industries expanding) also drive up longer term rates.   A negative spread indicates an inverted yield curve and investors believe the economy is overheating and interest rates will fall. Investors pull money out of the stock market and into long term bonds (raising the price, lowering the yield) while companies stop borrowing, reducing the demand for credit and lower the cost, or interest rate, on a loan.   Keep in mind central banks determine short term rates, so inverted curves are rare in the sense the market perceives uncertainty and rushes to safety (bonds) before the central bank reacts and lowers short term rates.


You can see some IRS info on distinguishing a business from a hobby here.  Nolo also has some info. The upshot is that you can only deduct losses if your activity is, in the judgement of the IRS, a for-profit endeavor.  You don't have to make a profit right away, or make a profit every year, for it to be a for-profit endeavor, but you have to be able to convince the IRS that you're doing it in order to (eventually) make a profit, not just for fun.  You can't just keep deducting the losses year after year if (as in the worst case you suggest) it never makes a profit and doesn't seem to have any chance of doing so.


Securities (things you can buy on the stock market)  that pay dividends usually pay every quarter (every three months), but some pay every month. (For example: PGF pays dividends each month.) IF you reinvest your dividends back into the stock then you will be compounding your return.  I use the feature at Scottrade to automatically reinvest the dividend each month. Using this feature at Scottrade incurs no commission for the purchases of the stock from the dividend. (saving on commissions and fees is, likely, the most important aspect of investing).  US Treasuries (usually) pay interest twice a year. There is no commission when using Treasury Direct.


"The short answer is no, it's probably not ok. The longer answer is, it might be, if you are very disciplined.  You need to make sure that you have enough money to pay off the card after a year, and that you pay the card on time, every month, without exception.  There may also be balance transfer or other fees that only make it worth while if the interest rate or balance on the other loan is high. The problem is most of these offers will raise your rates to very high levels (think 20% or more) if you are even one day late with one payment.  Some of them also will back charge you interest starting from day one, although I have only seen this on store credit ""one year, same as cash"" type offers.   In the end you need to balance the possible payoff against how much it will cost you if you do it wrong.  Remember, the banks are not in the business of lending out free money.  They wouldn't do this unless enough people didn't pay it back in one year for them to make a profit."


What Jaydles said. I think of each strategy in terms of Capital at Risk (CaR). It's a good thing to know when considering any position. And then conveniently, the return is always profit / CaR. With covered calls it's pretty easy. Pay $1000 for stock, receive $80 in premium, net CaR is $920.  If you own the stock and write calls many times (that expire worthless, or you that you buy back), there are two measurements to consider. First, treat every covered call as a buy-write. Even if you already own the stock, disregard the real cost basis, and calculate from the moment you write the call, using the stock price at that time. The second measure is more complicated, but involves using something like the XIRR function in a spreadsheet. This tracks the series as a whole, even accounting for times where there is no written call outstanding. For the written put, even though your broker may only require 30% collateral in a margin account, mentally treat them as cash-secured. Strike less premium is your true CaR. If the stock goes to zero by expiration, that's what you're on the hook for. You could just compute based on the 30% collateral required, but in my view that confuses cash/collateral needs with true risk. Note: a written put is exactly identical to a covered call at the same strike. If you tend to favor puts over CCs, ask yourself why. Just like a loaded gun, leverage isn't inherently bad, but you sure want to know when you're using it.


The initial story sounds normal. Happens every day. Checksums cannot prevent this, since it is a typo by the sender. The sender typed in a wrong account number. That account number happened to exist (so the sender wouldn't get any immediate error message), your account. But, that innocent story can also be used as part of a money laundering plan. Namely, to give the money a legitimate source. Also can be used in a scheme to frame you for something. The question of how the person got your phone number raises suspicion. The bluffs to avoid the normal paperwork, and then disappearing, make it incriminating. No doubt. Take this to the police. The question arises: even if the plan (whatever it was) failed, why didn't he do the paperwork and get the money back? The answer is that that would leave a trail to possibly be picked up in a future investigation.


Term life insurance for a healthy 30 year old is a heck of a lot cheaper than for a 40 year old who's starting to break down (and who needs the coverage since he's got a spouse and kids). So, get a long term policy now while it's cheap.


I don't really see it as worth it at any level because of the risk. If you take $10,000,000 using the ratios you gave making 2% return. That is a profit of $200,000. Definitely not worth it, but lets go to 20% profit that is $2,000,000. To me the risk involved at beint 10 million in debt isn't worth it to make $2,000,000 quickly it would be pretty easy doing something wrong to wipe out everything.


"Most financial ""advisors"" are actually financial-product salesmen.  Their job is to sweet-talk you into parting with as much money as possible - either in management fees, or in commissions (kickbacks) on high-fee investment products** (which come from fees charged to you, inside the investment.)  This is a scrappy, cutthroat business for the salesmen themselves.  Realistically that is how they feed their family, and I empathize, but I can't afford to buy their product.  I wish they would sell something else. These people prey on people's financial lack of knowledge.  For instance, you put too much importance on ""returns"".  Why?  because the salesman told you that's important.  It's not.  The market goes up and down, that's normal.  The question is how much of your investment is being consumed by fees.  How do you tell that (and generally if you're invested well)?  You compare your money's performance to an index that's relevant to you.  You've heard of  the S&P 500, that's an index, relevant to US investors.  Take 2015. The S&P 500 was $2058.20 on January 2, 2015.  It was $2043.94 on December 31, 2015.  So it was flat;  it dropped 0.7%. If your US investments dropped 0.7%, you broke even.  If you made less, that was lost to the expenses within the investment, or the investment performing worse than the S&P 500 index.  I lost 0.8% in 2015, the extra 0.1% being expenses of the investment. Try 2013: S&P 500 was $1402.43 on December 28, 2012 and $1841.10 on Dec. 27, 2013. That's 31.2% growth.  That's amazing, but it also means 31.2% is holding even with the market.  If your salesman proudly announced that you made 18%... problem! All this to say: when you say the investments performed ""poorly"", don't go by absolute numbers. Find a suitable index and compare to the index.  A lot of markets were down in 2015-16, and that is not your investment's fault.  You want to know if were down compared to your index.   Because that reflects either a lousy funds manager, or high fees.   This may leave you wondering ""where can I invest that is safe and has sensible fees?  I don't know your market, but here we have ""discount brokers"" which allow self-selection of investments, charge no custodial fees, and simply charge by the trade (commonly $10).  Many mutual funds and ETFs are ""index funds"" with very low annual fees, 0.20% (1 in 500) or even less.    How do you pick investments? Look at any of numerous books, starting with John Bogle's classic ""Common Sense on Mutual Funds"" book which is the seminal work on the value of keeping fees low.  If you need the cool, confident professional to hand-hold you through the process, a fee-only advisor is a true financial advisor who actually acts in your best interest.  They honestly recommend what's best for you. But beware: many commission-driven salespeople pretend to be fee-only advisors.  The good advisor will be happy to advise investment types, and let you pick the brand (Fidelity vs Vanguard) and buy it in your own discount brokerage account with a password you don't share. Frankly, finance is not that hard.  But it's made hard by impossibly complex products that don't need to exist, and are designed to confuse people to conceal hidden fees.  Avoid those products.  You just don't need them.  Now, you really need to take a harder look at what this investment is. Like I say, they make these things unnecessarily complex specifically to make them confusing, and I am confused.  Although it doesn't seem like much of a question to me.  1.5% a quarter is 6% a year or 60% in 10 years (to ignore compounding). If the market grows 6% a year on average so growth just pays the fees, they will consume 60% of the $220,000, or $132,000.  As far as the $60,000, for that kind of money it's definitely worth talking to a good lawyer because it sounds like they misrepresented something to get your friend to sign up in the first place.  Put some legal pressure on them, that $60k penalty might get a lot smaller.   ** For instance they'll recommend JAMCX, which has a 5.25% buy-in fee (front-end load) and a 1.23% per year fee (expense ratio). Compare to VIMSX with zero load and a 0.20% fee.  That front-end load is kicked back to your broker as commission, so he literally can't recommend VIMSX - there's no commission! His company would, and should, fire him for doing so."


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I want to start investing money, as low risk as possible, but with a percentage growth of at least 4% over 10 - 15 years. ...I do have a mortgage, Then there's your answer.  You get a risk-free return of the interest rate on your mortgage (I'm assuming it's more than 4%).  Every bit you put toward your mortgage reduces the amount of interest you pay by the interest rate, helping you to pay it off faster.   Then, once your mortgage is paid off, you can look at other investments that fit your risk tolerance and return requirements. That said, make sure you have enough emergency savings to reduce cash flow interruptions, and make sure you don't have any other debts to pay. I'm not saying that everyone with a mortgage should pay it off before other investments.  You asked for a low-risk 4% investment, which paying your mortgage would accomplish.  If you want more return (and more risk) then other investments would be appropriate.  Other factors that might change your decision might be:


"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."


This is really an extended comment on the last paragraph of @BenMiller's answer. When (the manager of) a mutual fund sells securities that the fund holds for a profit, or receives dividends (stock dividends, bond interest, etc.), the fund has the option of paying taxes on that money (at corporate rates) and distributing the rest to shareholders in the fund, or passing on the entire amount (categorized as dividends, qualified dividends, net short-term capital gains, and net long-term capital gains) to the shareholders who then pay taxes on the money that they receive at their own respective tax rates. (If the net gains are negative, i.e. losses, they are not passed on to the shareholders. See the last paragraph below).  A shareholder doesn't have to reinvest the distribution amount into the mutual fund: the option of receiving the money as cash always exists, as does the option of investing the distribution into a different mutual fund in the same family, e.g. invest the distributions from Vanguard's S&P 500 Index Fund into Vanguard's Total Bond Index Fund (and/or vice versa). This last can be done without needing a brokerage account, but doing it across fund families will require the money to transit through a brokerage account or a personal account. Such cross-transfers can be helpful in reducing the amounts of money being transferred in re-balancing asset allocations as is recommended be done once or twice a year. Those investing in load funds instead of no-load funds should keep in mind that several load funds waive the load for re-investment of distributions but some funds don't: the sales charge for the reinvestment is pure profit for the fund if the fund was purchased directly or passed on to the brokerage if the fund was purchased through a brokerage account. As Ben points out, a shareholder in a mutual fund must pay taxes (in the appropriate categories) on the distributions  from the fund even though no actual cash has been received because the entire distribution has been reinvested. It is worth keeping in mind that when the mutual fund declares a distribution (say $1.22 a share), the Net Asset Value per share drops by the same amount (assuming no change in the prices of the securities that the fund holds) and the new shares issued are at this lower price. That is, there is no change in the value of the investment: if you had $10,000 in the fund the day before the distribution was declared, you still have $10,000 after the distribution is declared but you own more shares in the fund than you had previously. (In actuality, the new shares appear in your account a couple of days later, not immediately when the distribution is declared).  In short, a distribution  from a mutual fund that is re-invested leads to no change in your net assets, but does increase your tax liability. Ditto for a distribution that is taken as cash or re-invested elsewhere. As a final remark, net capital losses inside a mutual fund are not distributed to shareholders but are retained within the fund to be written off against future capital gains. See also this previous answer  or this one.


"1) When it says ""an investment or mutual fund"", is a mutual fund not   an investment? If no, what is the definition of an investment? A mutual fund is indeed an investment. The article probably mentions  mutual funds separately from other investments because it is not uncommon for mutual funds to give you the option to automatically reinvest dividends and capital gains.    2) When it says ""In terms of stocks"", why does it only mention   distribution of dividends but not distribution of capital gains? Since distributions are received as cash deposits they can be used to buy more of the stock. Capital gains, on the other hand, occur when an asset increases in value. These gains are realized when the asset is sold. In the case of stocks, reinvestment of capital gains doesn't make much sense since buying more stock after selling it to realize capital gains results in you owning as much stock as you had before you realized the gains. 3) When it says ""In terms of mutual funds"", it says about ""the   reinvestment of distributions and dividends"". Does ""distributions"" not   include distributions of ""dividends""? why does it mention   ""distributions"" parallel to ""dividends""? Used in this setting, dividend and distribution are synonymous, which is highlighted by the way they are used in parallel. 4) Does reinvestment only apply to interest or dividends, but not to   capital gain? Reinvestment only applies to dividends in the case of stocks. Mutual funds must distribute capital gains to shareholders, making these distributions essentially cash dividends, usually as a special end of year distribution. If you've requested automatic reinvestment, the fund will buy more shares with these capital gain distributions as well."


Fund performance at NAV (%) for latest quarter, YTD, and average annual total returns for 1, 3, 5, 10 years. P/E ratio (1 yr. forecast), P/B ratio, Beta, Sharpe ratio, Wtd. avg. market cap, fund assets.  I guess I would want to calculate all these things based off of the data that I would be working with. I will assume I am working with daily fund values per share over 10+ years.


Article is 1 paragraph long and does not answer the question in the headline. Just states the fact that Tesla bonds are higher yield.  I was hoping to be able to read speculation as to why bond investor's are valuing them this way.


You should not open a company unless and until you want to continue operating your company for the longer term. If it is only for a year so so, refrain from opening a company. I am an IT contractor and operate through a limited company. Believe me it isn't that difficult to operate through a limited company. If you are afraid of doing your books, get an accountant and he will do it for you. Should not cost you more than a £1000 - 1500 or so. Regarding what you can claim as an expense, it depends on how you can confirm that the expenses you incurred are for the company. Your accountant can help you out on that. If you claim false expenses and are caught, you have to forgo a lot to the HMRC.  Google is the best option, there are loads of sites which can help you on that.


Far and away the most valuable skill in investing, in my opinion, is emotional fortitude.  You need to have the emotional stability and confidence to trust your decision making and research to hold on down days.


Usually points have different value depending on what you use it for and how much of them you convert. For many providers, if you have enough (10000+ usually) points, it is possible to convert them 1:1 (which means 1 point converted to 1 cent) to either cash or something that is almost as good as cash ($100 gift card for some popular store or $100 Amazon.com certificate, etc.). Some cards have more exotic ways of getting best value - such as transferring money to pay student loans, retirement accounts, etc. So to get the best value, I'd recommend to make a list of what you can get from your program (most types of reward are uniform - i.e., many gift cards with the same price, so the work may be less than it seems) and calculate point values of each of those. If you want to be really precise take into account that if you buy something with points, you do not earn points on that, which reduces the value a little. In general, these days it is very rare to get a card that produces more than 1% back, though some have up to 5% for certain categories of purchases.