Friday, January 19, 2018

Your ‘discount’ broker sells expensive products

BEWARE: Your ‘discount’ broker sells expensive products
According to a Wall Street Journal story recently, Schwab, Fidelity and TD Ameritrade incentivize their advisors to sell more expensive products to their clients. Yes, it is true. Unless you verify the cost of your “discount” broker/advisor, you are paying too much. You may pay 3 times the price others charge, especially for ‘managed’ accounts and proprietary items. For instance, if total costs for the account and the product are 2% a year, you are giving up 63% of your total potential. There are better products at lower costs. Buffett recently proved this, again—pay 0.04%. If your portfolio produces 6% over time and your cost is 2%, you earn 4%. On $1 million account, your balance is reduced to $2.1 million from $3.2 million. Based on interviews with dozens of former employees of the three largest discount brokerages, the firms encourage advisors to sell higher-cost products. Their rewards, NOT YOURS, are trips and bonuses.

IRS changes withholding rates
New rates mean more wages for some less for others, especially in the blue states. They will be increasing the amount sent to Washington since their deductions are going down. Since working Americans will be paying for the tax cuts for the wealthy, Trump wants to triple the fed gas tax to pay for more GOP spending. Not every wealthy GOP Congress person is in favor of making working Americans pay higher gas taxes to offset their tax cuts. However, fed revenue has been cut and the wage increases from more jobs will take time to come, if ever. Carrier, Trump’s poster child for jobs, has laid off another round of workers in January. WalMart followed by closing 63 stores.
Some states have increased their state income tax rate so you may not have higher take-home pay. Other states are finding ways to offset the fed limit of $10,000 on property and state taxes. GOP will raise health care costs as part of the budget deal.
Avoid paying for the $1.5 Trillion tax cut:

“You all just got a lot richer” with my new loophole
Trump boasted this to members of Mar-a-Lago on Dec. 22, according to CBS. The wealthy have a new tax loophole to avoid paying their fair share. The new deduction allows people with pass-through income — profits from a partnership or sole proprietorship, for instance — to write off 20% of that income before calculating their taxes. For instance, Trump owns more than 500 large, pass-through real estate firms like his golf clubs and hotels — just the type of business that would qualify most easily. His family and heirs can now avoid estate tax. They avoid the AMT—millionaire tax created by Nixon so the rich could not avoid taxes altogether. Trump did in 1995. Your business may qualify for the 20% deduction too.

 Buffett's SIMPLE Strategy Beats Wall Street—2017=22%; 11.11% since 1976.
The Master of investing, Warren Buffett, proved it, again. You do NOT need Wall Street 'professionals' to reach your financial goals. In fact, if you use them, you may give up 63% of your potential accumulations because of trading, charges, commissions and fees. Buffett’s SIMPLE strategy earns over 11% per yearDALBAR keeps track of returns and found that the average managed-account equity investor earned just 3.79% a year over 30 years. The benchmark returned 11.06%. You and I can start beating Wall Street with one phone call. Earnings are tax-FREE after age 59 ½ in special account too.
Earn 11% a year with Buffett’s SIMPLE strategy:

IRS free tax filing sites to avoid $300+ cost of filing
Commercial tax prep sites offer expensive loans as advances on your refund but you can keep your whole refund using the IRS free filing partners. Refunds can be in your account within 2-3 weeks. The average refund is over $3,000. You can create a tax-free retirement fund of $500,000 with that amount each year.

When you absolutely, positively, HAVE to get there
Certain vehicles seem to last for at least 15 years, at least on this list. Sorry, American nameplates avoid the list. But most Toyotas and Hondas are actually made by American workers. My 2012 Camry was made in Georgetown, KY. Toyota spent $1.33 billion at the facility and added 700 new jobs in 2017 in preparation for the all new 2018 Camry; the first copies of which rolled off the line on 28 June 2017. American nameplates do show up on the LEAST longevity list, with Explorer and Cherokee at the top—bottom. Fiat builds Cherokee in Toledo OH and Ford builds Explorer in Venezuela and Russia and assembles it in Chicago. Are Fiat and Ford designed poorly to NOT last?

Trump creates agency to enforce GOP religionist views; discriminate non whites
Office of Civil Rights used to enforce patient safety and privacy concerns. Now its new division, Conscience and Religious Freedom, will enforce "laws and regulations that protect conscience and prohibit coercion on issues such as abortion and assisted suicide in HHS-funded or conducted programs." "By ensuring individuals and institutions can exercise their conscience and religious freedom rights, OCR furthers justice and tolerance in a pluralistic society," says an announcement that published in the Federal Register Thursday morning. This is a tool to restrict access to health care for people who have different values than the conservative religious political arm of Trumpism. The irony is that this Trump constituency professes religion but has no problem with Trump assaulting women and his extramarital affairs. Their idea of ‘freedom’ is my ‘restricting options.’
GOP religionist wish to control each American’s behavior and their twisted idolatry is the method to do it. Trump’s Moral Police will enforce one religion’s view of how we act.
It is aimed at changing the behavior of non white, non straight, non GOP citizens. Hitler passed laws regarding the behavior of his scapegoat groups—jews, gypsys, cripples, etc.
Trumpism enforces GOP view of behavior while ignoring immoral and coercive acts.

Your advisor firm is taking more from your account than before
Morgan Stanley Wealth-Management Fees Climb To All-Time High is the headline. Morgan is not alone. If you made no trades and purchased no products, you may be paying over 1% of your account balance for NOTHING. Many firms have been moving more wealthy clients into fee-based accounts that are priced on asset levels rather than activity, boosting results as markets rise. Many clients were moved to permanent annual fee-based mode as a response to the change in the Fiduciary Rule. This Rule was designed to make advisors do what was best for us instead of selling expensive products we did not need or want. Instead, this trend will cost us more in the long run under the guise of a permanent firm ‘managed’ account. We are still being mislead.

Make “Donald” Great Again

“I have absolute right to do what I want to do with the Justice Department,”

Trump can’t be a racist: “he had a TV show” ??

Trump enforcers lie re: contacts to Putin and list longer: Why all the lies if innocent?

Mandate: ‘I was elected President’ like Washington, Obama and Hitler
Bannon and I wish to “destroy the state”–our government.
National Park Service Advisors resign—our parks converted into shooting clubs.

How Govt wastes our money:
Trump tells Bannon to refuse subpoena testimony—must be serious Trump treason.
Why is it OK for Trumpers to refuse to answer questions from Congress


Fed shutdown has workers continue to pay SS and military as essential services.

Who owns your account now?

A miracle if Congress passes bill that requires them to pay their own sex settlements.

41 Watchung Plaza, B242
MontclairNJ 07042

No comments: