Friday, April 24, 2015

Is your tax refund worth $500,000?

Is your tax refund worth $500,000?
Yes it is if you invest it in the most consistent investment of your lifetime. For most periods over 15 years, a low-cost stock market index fund has produced 10-12%. You can accumulate $500,000 in 27 years from your tax refunds which average $3,000. “Use a low-cost index fund” is Warren Buffett’s advice because you avoid wasting $300,000 on commissions, fees and loads over time and you receive the benefits of compounding high earnings, interest and dividends. If you use your IRS-approved tax-FREE account, you let Uncle Sam help you have more because you pay no tax on your earnings. Since you don’t try to time the market or buy the next HOT stock, you realize Buffett’s strategy: “We make more money from snoring than when active.”

Where is your refund?
Is your $3,000 on its way? Does the state owe you money too?
Check with the IRS:
Your state may have a portal like NY: or

Are all Americans paying their fair share?
Why do the rich stop paying FICA 6.2% tax on income over $118,500?
How can Apple pay 9% income tax while the US rate is 34% on earnings over $114,000?
The Supremes decided that corporations are people yet 2/3rds don’t pay any tax.  
Why do wealthy people pay less than the investment earnings tax of 15 or 20%? Romney paid just 14% in 2011. Kerry paid 13%. They don’t have wages so they don’t pay FICA, Medicare, state, local, and all the other things that come out of a worker’s check. They don’t have to take money out of their check for retirement or college funds, insurance co-pays, union dues, unemployment, disability, family leave insurance, etc etc. Buffett says the average family pays about 32% every check.
In fact, if the working rich paid FICA, "the Social Security system would be solvent indefinitely and the rich still would be the richest …."

In 2013 corporations that should not have qualified for the breaks, got them. We taxpayers paid the expense. IRS said it can’t assure errors are corrected. It receives $1 billion less than it was five years ago. GOP Congress saved $1billion but “lost” $3billion.

Bad brokers/advisors just move on when they hurt clients
They aren’t jailed or banned. When they manage large assets, another firm will hire them so they can screw new clients. Tom Buck, an Indiana broker was fired by Merrill because he provided inaccurate information and misreported information to a client. Buck was hired by RBC next day. RBC spokeswoman Nicole Garrison said, "We take special care to ensure that each advisor shares these same values.” Time to manage your own account? Are your 401k plan fees high?

How can you make your life easier in retirement? Are you ready for retirement?
Experience is a great teacher but we don’t get a second chance. Experts in planning for retirement have these tips to succeed. 1. Social Security early?—you lose 25% of your benefits for the rest of your life. $11,700 average reduced benefit for 30 years means $350,000 instead of $468,000 in today’s value. 2. Die early?—estimate your lifespan at 3. Emergency expenses?—costs over Medicare average $120,000. 4. Pensions, IRA, accounts everywhere?—one low-cost mutual fund firm (Vanguard, Schwab, etc) cuts accounting bill. 5. Get Medicare anytime?—miss Medicare deadline can cost 20% more each year:

Survey says most investors use the “gut” strategy
Fifty-seven percent of respondents said they had no financial goals, 67 percent had no financial plans and 77 percent said they relied on gut feelings to make investment decisions. The DALBAR study shows the average investor return was 3.69% not the market return of 11.11% over the last 30 years because they have no strategy. They jump in at the top and sell when the market falls.

Is your vehicle on the worst cars list—mechanics love you!
You don’t get what you pay for in vehicles. Pricy Land Rover, Caddy and Lincoln hit the top 10. And don’t forget GM’s KILLER cars. (Cover up and legal BS can’t hide fact GM kept using defective switch that killed 13 real people and destroyed their families.)
Cost matters just as it does in financial services.

Car thieves have new way to take your car wirelessly
Now keyless entry cars can be opened with $100 gizmo—back to real keys?

GOP crazies
GOP-FoxNews received a straight answer to why Rubio/Cruz lose Latin vote: “it’s immigration,” Jorge Ramos told Hannity. “It’s a very simple concept, Sean — people won’t vote for a candidate who will deport your father, your friends, your colleagues, and your students.” And why would a sane person vote to outlaw their $100 per month health coverage especially if they have an existing condition? And would a senior really vote to limit Social Security and Medicare? And do Americans really agree it is OK to discriminate against you when a business owner says the Bible tells him to not serve youWhat about stoning women to death? Cursing brings death too?

KS GOP wants limited government for wealthy but NOT for the poor?
Legislators say they want smaller government but not for certain groups. Law says “List of items you can’t buy because you only make $7.25.” NO movies, tattoos, lingerie, and several dozen items. Guns are OK.

GOP gives their backers a tax break AGAIN!
The millionaire club called the House of [their] “Representatives” voted to ban the IRS from following the law on gift taxes for their political contributions. Billionaires are smiling all over the world. “Americans who donate to tax-exempt organizations should always be treated fairly and equally by the IRS” according to the Republican chairman of the House Ways and Means Oversight Subcommittee. Now foreign governments and rulers can funnel their money thru PACs and join the wealthy in electing their stooges.
… “and the pursuit of happiness” for wealthy and corporations.

GOP candidate for President already decided by $1 billion Koch Bros: Walker
The Koch brothers plan on spending close to $1 billion in 2016 cycle and their favorite is Scott Walker. They use the Freedom Partners network included Americans for Prosperity and funded groups such as Concerned Veterans for America, the Libre Initiative and Generation Opportunity to hide their donations.
Walk-with-Walker: “In terms of legal immigration, [it is] based on, first and foremost, on protecting American workers and American wages.” But didn’t he bust all unions in WI?

GOP Christie thinks NJ voters are stupid!
New Jersey rules require Republican Gov. Chris Christie's administration to cancel investment contracts with firms whose officials raise or donate money to the governor’s political campaigns. But he paid $16 million in pension fees to the financial firm that was led by Christie’s chief fundraiser and top donor, Jon Hanson. The money flowed to Hanson’s company, Prudential Financial, while Christie has refused to honor his commitment to fully fund workers’ pensions. Last week, a study showed that more than half of fees that pensions pay to private financial firms are hidden.
What kind of President will Christie make?

Fmr GOP presidential candidate says Obama bringing Rapture
Michele Bachmann says the rapture is coming, thanks to President Barack Obama’s policies on Iran’s nuclear program and marriage equality. “We need to realize how close this clock is getting to the midnight hour.” “We in our lifetimes potentially could see Jesus Christ returning to earth and the rapture of the church,” Bachmann said. “We see the destruction, but this was a destruction that was foretold.”

DEM crazies
Media personalities don’t walk the talk: condemn tax evasion but are above the law themselves. Reports say that Rev Al has a tax bill of $4.5 million. Lesser amounts for Melissa Harris-Perry, Joy Reid, TourĂ© Neblett. It comes down to keeping records—if you don’t; you can’t. As one of them said: “taxes are how we all do our part” unless we don’t. The wealthy of every persuasion seem to see it differently.

Employers see health costs slowed! GOP warnings were wrong
Health care in the U.S. is a hot button issue but the early consensus is that the Affordable Care Act has been integrated well by employers. “One of the big concerns [about the ACA] is this is going to drive up our premiums and the cost of healthcare,” says Christopher Ryan, vice president, Strategic Advisory Services at ADP. But, he adds, this has not materialized as originally thought. “I give credit to business,” he adds, “I think business looked very carefully at their current practices and … has been well managed.”

Is a reverse mortgage right for you?
You might consider this expensive loan if you find your retirement costs greater than your income. Receiving a monthly payment from your bank sounds good but consider the challenges. If you take this loan early in retirement, the payments lose their buying power (HALF value in 25 years) and you might have trouble paying property taxes, insurance, maintenance, etc. Loans accrue interest so you may reach the end of the loan. Loan costs are high (even though insured by US) and even higher if you take a lump sum and not payments over a lifetime. Alternatives: refinance to free up money and keep asset growing; take a low-cost home equity loan; trade down and keep cash; rent to boarders/corporate suites; sell home as investment to your family. See:

Do you need long-term care insurance?
The share of the older population residing in skilled nursing facilities declined from 4.5 percent in 2000 to 3.1 percent in 2010. The share in other long-term care facilities, such as assisted living, has been growing. • Medicaid funds for long-term care have been shifting away from nursing homes with funding for home- and community-based services increasing from 13 percent of total funding in 1990 to 43 percent in 2007. Medicaid currently accounts for 40 percent of all spending on long-term care. GE recently took a loss on this business and may exit as others have.

What retirement plan?
Many expect to “work till they drop.” But what if you can’t because of disability or unemployment? A new report shows that while workers SAY they will work longer, the actual median retirement age has been stuck at 62 since 1991. 57 percent say they have less than $25,000—about 1 year worth. Many say they can add $25 a month to their nest egg but don’t. Automatic investment plans may be the answer. We could have our Tax-FREE IRA trustee debit our checking every month and end up with $250,000 without working longer.

Americans’ attitudes toward redistribution of wealth are more complex
Americans’ desire to soak the rich has diminished even as the rich have more wealth available that could, theoretically, be soaked. Our political persuasion tilts how we feel about tax redistribution. Older voters already have “social medicine” and so were afraid they would lose it with ObamaCare. However, GOP lost voters when they talked of cutting Medicare. Americans have hope they will be better off so why support taxes they may have to pay. Few know that the wealthy never pay the higher 35% rate.

Will high salary for all employees make a better company?
The minimum wage at Gravity Payments, a credit card processing company, was raised to a hefty $70,000 a year for everyone by the CEO, who cut his $1 million salary. There are only 120 employees and most are pros at their digital work. Highly motivated employees can create a great business according to observers. Rush Limbaugh, overpaid commentator losing sponsors, proclaimed: “pure, unadulterated socialism, which has never worked.” Warren Buffett’s staff would disagree.

Is a safe-deposit box worth it?
You pay your $100 a year in case of fires and natural disasters. But safe-deposit boxes can’t be opened by your loved ones when something happens to you. Power of attorney, organ donation, funeral instructions and a will need to be ready immediately. And don't expect the bank's insurance policies to cover your belongings. No FDIC either. Valuables could be hidden in plain sight. Are they insurable? Store copies of documents with relatives in emails to them—“Open in case of emergency” files.

SCAMS           Why are we still paying $700 Billion a year for WWII deployments? That is 27 cents of each dollar in taxes—the largest part of our money—and we aren’t even at war. We could pay off our debts and fix our schools, roads and bridges!
We are paying for 164,253 of our active-duty armed personnel to be in 150 countries around the world. We have about 50,000 in Japan and 50,000 in Germany.
Are we preparing for WWII again? There are 1,208,083[1] armed personnel in the United States. Our taxes pay for about HALF of the WORLD’s military expenditures every year. We have wasted $398.6 billion so far on the F-35 program—they can’t fly safely.
We just can’t afford to pay for everyone else’s defenses anymore.
Japan, Germany and S. Korea can pay to defend themselves.
The War on Terror requires SEALS’ attacks on top terrorists at their homes. Iraq proved converting a nation to Western-style republic doesn’t work. The troops we trained ran away. We are wasting $4 billion a year on Afgan tribal rivalries; paying ransom to Al Qaeda; supporting corruption with our money.

Fed identifies banks that could cause financial meltdown
Most banks do not have large ‘gambling’ departments and don’t need regulators to watch them closely. Only a few banks have trading assets or liabilities, derivatives positions--interest-rate swaps and foreign exchange derivatives. Roughly 6,100 of the more than 6,500 commercial banks would pass this test, according to the F.D.I.C. Of the remaining 400 that would not, many are behemoths: 310 of them have more than $250 million in assets. Regulators can watch 400 easier than 6,500. Common sense, right? Not yet. Lobbyists want no regulation on any.

The Middle East arms dealer of choice is …
Everyone is arming to the teeth with American weapons and equipment as the Congress declines to declare war. Saudi Arabia spent more than $80 billion on weaponry last year. The Emirates spent nearly $23 billion last year, more than three times what they spent in 2006. Proxy wars in the Middle East could last for years, which will make countries in the region even more eager for the F-35 fighter jet, considered to be the jewel of America’s future arsenal. Where will all the American-made planes, missiles, bombs etc. end up now that Iran is leading the ISIS coalition?

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