Friday, August 31, 2018

Avoid SCAMS of brokers and advisors

How can you avoid SCAMS in financial services?
Wall Street is a ‘war’ zone! We must enter this war zone with the protection of knowledge. We could lose all our lifelong savings in one trade. Brokers and advisors have weapons that can 'kill' us financially. They are hidden behind lies, exaggerations, obfuscations and straight-out fraud like faking our signature. Half-truths and our assumptions and greed are also at play. These are our 'soft' underbelly targets. There are warning signs but most SCAM situations require us to be knowledgeable and to check every move. My first day as a manager at a security firm I was told: ‘brokers are [car] salesman.’ Our future life is at stake and yet we give strangers our money so easily.

Trump’s new health care plans
Think about this: you are 44 years old and have a heart attack. You are in great shape—you finished the Ironman triathlon just five months before. Your hospital was out of network for your school district plan. The hospital charged $164,941 for your surgery and four days in the hospital. Aetna, which administers health benefits for the Austin School District, paid the hospital $55,840. Hospital sent you a 2nd notice for $109,000. This is the way it used to be before ObamaCare and mandated ‘comprehensive care.’
In order to ‘Make America Great Again’ Trump and TX are sticking us with bankruptcy.

New ways the wealthy avoid taxes that we have to pay for them
The Trump tax breaks did not change a 1962 tax loophole from J F Kennedy. It allows the wealthy with money hidden overseas to declare and pay the corporate rate of 21% not 37%. The rich get richer. We have to pay for the courts, police, military, roads, airports, etc. the rich use but don’t pay for. We taxpayers help pay for their yachts and overseas vacation and rental properties. Imagine paying your tax at almost half the rate and then leaving it in a shelter with no income tax. You could live off the interest (no taxes) in one of your discounted villas and earn rental income while you were away. Trump’s mob favors Bank of Cyprus where the bank board is held by Wilbur Ross Commerce. Ross did not respond to Congress requests for info on money laundering via his Cyprus bank. However, Russians have used this facility with NO questions asked. The Panama Papers illustrate how hidden money gets laundered into mansions and property for sale. The IRS lets them earn some income overseas without being taxed too.

Does your vehicle hold value?
The brand receiving the most model-level awards is Lexus (five model-level awards), followed by Honda and Toyota with four model-level awards each. Chevy did NOT earn more awards than everyone else as they claim.
Lexus: Lexus IS; Lexus NX; Lexus LS; Lexus GS; and Lexus GX
Honda: Honda Civic; Honda Accord; Honda Odyssey; and Honda Fit
ToyotaToyota Tundra; Toyota TacomaToyota 4Runner; and Toyota Sienna
Porsche: Porsche Cayman;  Porsche Boxster; and Porsche 911
Subaru: Subaru WRX and Subaru Crosstrek
Dodge: Dodge Charger and Dodge Challenger
Check your ride by class and size. Flood-damaged cars ‘flood’ markets BEWARE.

Is pet insurance right for you?
Pet insurance premiums rose 23% last year, and the number of insured pets rose about 16% to 1.83M last year, the Wall Street Journal reports, citing the North American Pet Health Insurance Association. Americans spent about $17B last year on veterinary care-- per pet that comes to $257 for routine care for dogs and $182 for cats. The largest providers of pet insurance are Nationwide, Trupanion, and Healthy Paws. Only about 1% of dogs and cats in the U.S. are insured, but insurers expect that number to grow. Most adults don’t even carry life insurance because other needs come first. Your need for pet coverage must be weighed against other expenses: basic emergency fund, family health insurance, transport, food, shelter, etc. Insurers see the fast growth of this cover and may spend more to induce us to buy pet insurance. Pets are important like our well-being.

Did you get help paying for Trump’s tariff taxes?
Farms are not really struggling small businesses anymore. Farms are now corporations with over 2000 acres—70% of all our cropland. Super-aggie biz is socialism writ large. Trump has turned capitalism upside down. He gives $12 billion to corporations which are large enough to afford a slowdown. This Trump socialism is political juice to his followers who have fallen in love with Russia/Putin-style ‘democracy.’ You and I did not receive money to help pay for the price increases from tariffs. Farm corporations, known as ‘agribusiness,’ have been on a socialist track for a long time. Between subsidies and loans and insurance, agribiz has outgrown the need for subsidies set up when farmers had to struggle to live. Most Americans balk at giving hard-earned taxpayer dollars to people who make many times what most Americans do. By all means, let’s have a safety net. But, in years when farm firms make hundreds of thousands of dollars, I think they’re pretty safe already. Like coal, oil, gas, sugar, etc we pay everyone else except ourselves—even Congress people are double dipping. Trump gives tax cuts to wealthy.

CAUTION: Brokerage firms are reinstating commissions for IRAs
Firms like Merrill are charging commissions again for IRAs because Trump cancelled the Fiduciary Rule. This Obama regulation protected you from sellers making a fortune when you moved your IRA to their firm’s products—usually a variable annuity. Trump was told that the industry would be hurt if it could not continue to earn 6-10% on your IRA move. The wirehouse, which has about 17,400 financial advisers, is instituting the new protocol on Oct. 1, along with additional adviser oversight and new client disclosures. Merrill cited “client pressure and a new regulatory environment as the primary factors behind the change.” Merrill and others had required brokers to use an advisory account to comply with the Fiduciary Rule. Now you will be switched back to create commissions. They are using the misleading reason: “greater choice and flexibility.” Of course you have always had ‘choice.’ Handsome commissions are paid by insurers. They recoup them with multiple annuity fees you pay over the time you hold annuities.

Are the top hospitals near you?
The current report on ‘best’ hospitals by USNews is out and mine are not on it. However, your doc may be good enough working out of your local facility for your needs. The report uses risk-adjusted survival and readmission rates, volume, patient experience, patient safety and quality of nursing, among other care-related indicators. My local hospital does not have high volume so it won’t score high ever. Tons of data are collected for this survey so for special conditions, it is useful. Whether your health insurance plan would ever pay for care at the ‘best’ facility is another matter. Some facilities have waiting lists for admission. Most of us have never lived with another country’s plan so we don’t know how good our health care is. If we compare our overall health to that of other industrial countries, it seems our general health care is determined by income not by this report. Access is the operative concern to the rankings by the World Health Org  which show a different picture. Our ‘best’ is there for those who can afford it. 70% of us would like to try Medicare for all since we can’t afford the ‘best.’ It bankrupts us.  


Make America, “The Don”, Great Again

Two Americas: A Banana Republic? Do we really want an infant king? Daddy Putin!


Trump tax deduction cap $10K can be avoided; use the Trump tax avoidance method.
Trump cancels Fiduciary so we go back to losing $17 Billions for ‘biased’ advice

President/Mob boss says Cohen did not commit crimes: law or dictator decides?

Hang up on a caller that claims you won or you may lose it all: “I will handle taxes.”

Legg Mason caught bribing foreign government for investment business

Did the American experiment end with McCain? Can our rulers have integrity again?

Hunter blames wife for spending but he spent $400 for 30 tequilas at a bachelor party.
Child care costs as much as rent in some communities: no savings possible.
Wichita allows citizens to drink bad water for years: Who’s guilty? Jail time?

               police shoot owner who already shot intruder. Kids will have plastic killer guns?

Wage increases not kept up with price increases: Trump tax cuts give firms pricing power

Who owns your account now?
Is it cheaper to buy your suitcases a seat than pay $150 to check them? YES!
Deceased relative left insurance policy?:

Regulator allows banks to plunder student accounts: “legally dubious” debit card fees.

Living on SS benefits alone? Rents in certain towns make it possible.

41 Watchung Plaza, B242
MontclairNJ   07042

Friday, August 24, 2018

Opportunity Zone funds right for you?

Are Opportunity Zone funds right for you?
The new GOP tax breaks to the wealthy provide them a way to eliminate some of their gains built up over the years. If they invest in infrastructure projects in areas designated by politicians for development, they can delay taxes and make a fortune. Real estate firms are starting Opportunity Zone funds so high-net-worth investors can co-own apartment buildings in cities like Detroit and reap unique tax benefits at the same time. This kind of investment is long-term and complicated. Even your attorney and accountant do not understand how these real estate deals will work out. Will the zoning go through local political boards? Will you have time to use the tax advantages promised? You might just consider this kind of investment only if you are in the same situation as the author—President Trump.
There are less risky ways to accomplish these goals:

Ops, did you make these mistakes in taking your RMD?
The penalty could be 50% of the amount not taken. The first required minimum distribution is difficult to calculate so ask your IRA trustee to do it. Set up direct deposit to your bank with the trustee so you won’t forget to take the money each year. Timing the first distribution incorrectly could bump you into the next tax bracket. The amount depends on one of two tables with another test. The amount is calculated from the total of ALL your IRA accounts. It might be smart to move all IRAs to one trustee. Roth 401ks require a distribution too but not for taxes. There are special rules for those still working at age 70 1/2. Converting an IRA to Roth does not change the RMD rules. Giving RMD for charitable deduction has rules too. Remember to tell the trustee which security to sell. RMD must be done for each spouse. Let the trustee help you.

Wharton School predicts SS benefits cut by 2032
U of Penn economists say Trump’s higher deficits will deplete SS trust fund faster than the SS trustees projected. Wharton projects “much larger future annual cash-flow shortfalls.” After Social Security was revamped in 1983, it was projected there would be adequate resources to pay benefits through 2058. However, many of the assumptions have been wrong. The Trustees project that the combined trust funds will be depleted in 2034. We don’t know if the Trump Grand Old Party will reverse the new tax cuts and stop the $1.3 Trillion spending. If you are under 50, you have 15 years before changes. Start your SS supplement now: $500 a month in index gets you $200,000 as supplement.

New way for the wealthy to avoid taxes
Pensions systems for doctors, lawyers, money managers and other highly-compensated business owners help them defer taxes on their pay until they can use a tax-advantaged shelter. Trump’s new 20% deduction law can be used by the wealthy when they put more into their pensions and thus reduce their current income. Thus they get around the income limits Congress created to bar them from this new tax break for owners of pass-through entities. So pensions become the new tax dodge. These defined-benefit pensions can shield more income than a 401(k) account or individual retirement account. Annual employee contributions are capped at $18,500 this year for 401(k)s and $5,500 for IRAs. Thus they get to take the 20% deduction while we can’t. So we must pay their taxes.

Is ‘return of premium’ term life insurance right for you?
The HOOK: If you don’t die you get a nice nest-egg of savings. Your premiums ‘usually’ will be returned to you at the end of the term. It sounds like ‘renting’ coverage for FREE. Except it isn’t. The sellers do not explain that ROP costs more—about 30-40% more and that you are not guaranteed to get all your premium returned after 20 or 30 years. In fact many buyers just stop paying premium for different reasons and don’t get their premium back. Agents push hard for riders—disability, accidental and otherwise. However, if you are in good health, your extra premium earns more in a real investment. Life insurance used to be sold as an investment before mutual funds were made more available with better returns. However, for wage earners without a savings instinct, life insurance policies force us to save something.

Is your advisor a CFT?
That is Certified Financial Therapist. Since our emotions are heavily tied up with our money attitudes, CFTs may have tools to help clients develop positive financial behaviors through practical simple steps. Many people need help coping with money issues—couple sharing financial data, fair settlement in divorce, gambling and abuse of money resources to name a few. Financial planners can become more finessed and have greater long-term success with their clients. Certainly there are many couples who could find support in discussing these matters. Right now we might have to ask an advisor or planner to share their personal history to find out if they have the experience to help us with financial/emotional issues that damage our future. Most clergy have trouble dealing with these issues because they have no financial or psychology training.

Aretha leaves no will for directing $80 millions
Her sons will have to pay lawyers $ millions and the tax up to 50% with no planning. Many people think, “If I do it, I’m going to die the next day,” one lawyer said, or they plan to get around to writing a will but never do. Like Prince, Sony Bono, Pablo Picasso, Jimi Hendrix and Howard Hughes, Aretha had no will and no estate planning documents. Her four sons must go to court again and again to find a settlement. Without any planning, the federal and state estate tax will take up to 50% of their $80 million inheritance.

Discrimination is now called ‘religious freedom’
Trump has changed the regulations about discrimination by contractors. As long as you claim it is your religion that ‘impels’ you to refuse someone service, your not discriminating. Trump implies that Christianity is under siege. They [Labor Dept] must respect the right of “religious people and institutions . . . to practice their faith without fear of discrimination or retaliation by the Federal Government.”
They cannot “condition the availability of [opportunities] upon a recipient’s willingness to surrender his [or her] religiously impelled status.” Trump has changed the regulation so that it is assumed a contractor has ‘surrendered’ their beliefs to offer a service paid for by the govt. This regulation expands the scope of federal contractors that are exempt from the prohibition on discrimination against employees and applicants based on sexual orientation and gender identity, and LGBTQ advocacy organizations have criticized the directive as a “license to discriminate.” This started when Hobby Lobby told the Supremes the store would NOT provide preventive care and screenings” for women ...” Other employers provided this health care necessity because it was the law. No longer.
Soon employers can decide not to cover cancer because cancer is ‘god’s will.’

Is it time to move your money from losing stock-pickers and FREE trade deals?
Another year of poor performance? A market index returned over 14%; 13% over 5 years. Only 36% of stock-picking managers survived or outperformed their average passive peer over the past 12 months, according to Morningstar data. Every brokerage in town is offering you the chance to trade all day every day for FREE. However, if the folks with $ millions of research can’t beat the index, why do you think you can? You would have to be right every year! Your chances of picking the right stock is 1 in 19,000 EVERY year. Good luck on your picks. Vanguard’s 500 Index gave you 11% since 1976. Warren Buffett says you only need 2 funds.


Make America, “The Don”, Great Again

Two Americas: A Banana Republic? Do we really want an infant king? Daddy Putin!


Trump’s coal company deal for profits—costs 1,400 Americans lives. 

Hector May Securities America stole $millions from pensions with Ponzi
Interactive Brokers violated short-sale rule and failed to supervise/correct same.
Eric Lesak and Global Research PA caught penny stock fraud cold calling.
Caleb R. Overton Biltmore caught misleading clients; risky option trades; lost $

GOP Rep Hunter blames wife for his illegal spending! And he’s a marine!

House alarm system SCAM: “The police use our system.”
Insurance co-pay $285 for 90-day supply: $40 without insurance. We are being robbed.

Trump’s lawyer: ‘Truth isn’t truth’ so only what Trump says is truth, is truth. Putin won!
Trump says his mob did not break the law: His law is the only true law—tyranny!

Brennan: Trump activity traitorous – Obama CIA chief says Trump dangerous.
               More laundry: Toronto, SoHo, Tower
Sessions to Trump: F--- off. True crime is true crime and criminals go to jail.

               police shoot owner who already shot intruder. All kids have plastic killer guns?

Student loan payoff added to new benefits to entice new recruits at some companies.
NO jobs: Trump’s tax breaks for companies goes to owners’ stock buyback of $1Trillion
Name your price: Artificial Intelligence and machine learning pay big bucks

Who owns your account now?
IRS gives advice on protecting your account passwords.
Home values in flood zones may mean the bank will eventually own your home.
Giving your house title to your kids to get on Medicaid is NOT a solution.


How so many souls were touched by Aretha was a miracle.

kids 3 & 1 yrs old survive car crash after days in overturned car alone. Seat belts?

41 Watchung Plaza, B242
MontclairNJ   07042

Friday, August 17, 2018

Are ETFs right for you?

Are ETFs right for you?
Yes, you can trade exchange traded funds all day but at what cost? ETFs are index funds sold by brokers so you pay commissions/fees and you pay up to the 1.35% expense ratio of this fund itself. That makes some funds lose 16% for their 3 year return. The only reason to pay a broker and expenses for an index is to try to time the market. You have the chance to win big or lose big. I call this gambling and even the best gamblers in the market rarely do well. With millions of folks trying to find and use that special edge (your broker’s insight) it is just mathematically impossible. But as you have heard, gamblers have eternal hope that the strategy that doesn’t work for others will surely work for them. In study after study, cost was the best determinant of an investor’s success.

How do you avoid taxes on your excess cash?
Buy tax-FREE municipal bonds if your tax bracket is high. This is the traditional solution for the wealthy. But if you are not wealthy and still want to reduce your tax bill, buy quality stocks that don’t produce dividends. Since you would prefer not to lose money, buy a firm that seems to have a diversified portfolio that ignores business cycles. One firm that stands out over time is Warren Buffett’s Berkshire Hathaway. It owns GEICO, Coke, Wells Fargo, American Express, Kraft, BNSF rail and others. It has symbol BRK.B. It has growth and profits. Over time the stock has gained about 20% a year for shareholders. You pay tax only when you sell. Buffett has called this method an ‘interest-FREE loan from the government.’ His tax rate is 17%--HALF that of his staff at 33%.

New way the wealthy maintain their wealth: summer camp
Is your child at this kind of summer camp? Do they spend their summer camp learning how to grow their wealth? If this is something you might be interested in but just can’t afford it, there is hope. Your kids can learn the real secret to building wealth by using a little used tax shelter for those making under $120,000 or $189,000 for couples. They can put away $5,500 a year and end up with TAX-FREE $500,000. The teacher at this summer ‘camp’ is the most experienced investor of our lifetime: Warren Buffett. He recommends your child use a simple formula that anyone can learn. And because he is the ‘advisor’ not some Wall Street slick, there is no cost to invest. He will not be taking 1-2% of your kids money each year to assure that the firm knows best. He will help them learn how to control their fears about money and investing. And as proof that his strategy works, he explains how he recently beat the strategies of multiple Wall Street gurus. That kind of information is priceless but because Warren already has more money than almost anyone, so there is no charge.
This is your child’s chance to be wealth.

Get best price for your home and skip gains tax
There are secrets to selling your home successfully. You have to prepare your home and find the right agent to help you in return for your 3%. You may also skip taxes on the gains in your home since you purchased it. And you can even skip the gains on your rental properties. IRS says take your gains FREE up to $500,000 for couples. If you spend 2 years in your rental, you get to save gains tax again. Rental properties can provide special tax benefits while you build equity. Like Trump you use other people’s money to add value to the property and deduct expenses from your income taxes. When you sell, you keep up to $500,000 in gains. Timing is important.

Is Aflac insurance worth the money?
What does the lapsed-in force ratio tell us about this kind of insurance? Aflac customers quit at about the same rate as new ones begin. For 2017, annualized premiums in force was $5,896 billion, new sales, including conversions, of $1,552 billion, and Premiums lapsed was ($1,525) billion. So new replaced lapsed. The duck commercial gives the impression that we can receive money when we can’t work. Most states require that employers carry workmen’s compensation for just this need. Some even provide temporary disability insurance and sick/vacation time. Also, if you have a savings fund or other income, this policy may not be needed. Other buyers have had their problems with this coverage. Sales are necessary to maintain the cash flow so Aflac concentrates on that. When a firm must concentrate on sales, sales bonus and prize trips are the expense that you must pay. Expensive incentives are your costs. Consumer Reports has concerns too.

New ways the wealthy avoid taxes that we have to pay for them
The Trump tax breaks allow the newly wealthy to avoid paying capital gains taxes on their $ millions worth of stock. They can also claim a charitable deduction that most likely saves millions of dollars more, and probably reduced their personal tax bill for years to come. How? Donor-advised funds, allow wealthy individuals like Mr. Woodman founder of GoPro to give assets — usually cash and stock, but also real estate, art and cryptocurrencies — to a sponsoring organization like the Silicon Valley Community Foundation, Fidelity Charitable or Vanguard Charitable. They get the benefits—tax cuts of 50%--and then get to grant it to their favorite organization. This gives them influence without negative press or taxes. The Trump administration said it would stop requiring these nonprofit organizations to disclose the names of large donors, a change that will make it easier for some political groups to hide their funders. Now they can make policy without any accountability. Since they don’t pay taxes, we have to pay for the courts, police, military, roads, airports, etc. The rich use all the services but don’t pay for them.

Are Dividend Reinvestment Plans right for you?
These plans automatically buy more stock with your dividends from the stock. Typically you are putting all your eggs in one basket and for someone in a low tax bracket like a child, this is great. A $2,000 investment in Pepsi in 1980 would be worth more than $150,000 by the end of 2004. You would have started with 80 shares, but by reinvesting dividends, you’d now have 2,800 shares.  If you have a favorite firm you may be able to buy direct from it but watch the brokerage fees and DRIP charges—nothing is FREE even for young investors without money. It would be good to research the lowest fee highest yield stock so you earn over time. However, there is no guarantee that your pick will keep raising dividends. Of course, most mutual funds offer FREE dividend reinvestment as part of their share ownership. Buy broad markets earning 11% over time.

Our broker/advisors will now have a background check
BrokerCheck information about our representative is accurate, complete and up to date as possible claims FINRA, the brokerage trade representative. Our advisors are monitored by the securities regulator using form ADV. If you feel there is something wrong in your account or their behavior, report it immediately to these regulators. Brokers with questionable records tend to move to new firms so it is best to track their missteps going back as far as you can. And don’t let the publicity of a big firm cloud your research. EG: Morgan Stanley needs the fees as much as a small firm. Presumably FINRA checked on this broker before she moved to a new firm. Now that the Fiduciary Rule has been eliminated by Trump, we have little protection except by our own due diligence.

Is your broker/advisor’s Financial Plan right for you?
They will be paid more if you buy their Financial Plan. And don’t be surprised if the Plan calls for more products. Morgan Stanley has released their comp grid (pay scale) for next year. The most radical aspect of Morgan Stanley’s plan is tying pay changes and bonuses to individual customer accounts rather than to overall production that can be generated from a small percentage of a broker’s book (your account), said insiders and consultants. It’s also the riskiest in terms of winning broker acceptance, because he or she needs widespread adoption across clients to make a meaningful difference to compensation.
“You’re going to need to fundamentally shift your business approach for this to add up,” said Andy Tasnady a comp consultant. “In the past, it hasn’t been designed at a micro level for just a household.” They will earn more by moving your mortgage and bank accounts to their bank. Most firms strive for the “whole client wallet” meaning they control all your money. Just remember that you will need help taking all your accounts back. Merrill Lynch is actually lowering payouts if you don’t buy their plans.


Make America, “The Don”, Great Again

Two Americas: A Banana Republic? Do we really want an infant king? Daddy Putin!


Trump military parade costs $92 million; Pentagon cancels; Trump goes to Paris!

What happens when you don’t show up for work? Our reps dock pay, fired, something?

Richard Moseley Hydra caught collecting unlawful debts, fraud, conspiracy $14 million
Scott Kohn NV Future Income Payments stole $100 million in pension buying scam.

David Laurance Tomahawk Exploration caught oil drill fake projections
LifeVantage sued for being a pyramid

Lockwood Advisors BNY Mellon caught undisclosed wrap fees hidden in ‘net’ price.
Alexander White Paul Vandivier Chad Lewis caught selling unregistered investments.
Citigroup’s 1-year ‘structured note’ claims cushion inversion in yield curve: Bet now!

Ameriprise failed to safeguard retail investor assets from theft by its representatives.

Valley Electronics Daysy contraception may not work.
Citrus World and Florida Natural Growers selling ‘natural juice’ that isn’t.
Crisco Virgin Oil Spray that is not an ‘extra virgin’ at all. Extra? How?

Trump destroys FBI agent for 1st Amdmt tweets The Don does not like. (like Putin does)

               police shoot owner who already shot intruder. All kids have plastic killer guns?

Retire? Never! I switched to part-time instead; saved in Roth IRA for Tax-FREE.

Wages same 40 years ago with inflation: same as $2.50 1964; $22.65 2018; 1973 $23.68
Money and job keep us up at night: relationship is No 1.
Extra cash with part time job: 40% of us average $700/month

Who owns your account now?
Bankruptcy: 3 times higher than 1991 for seniors: health costs, no savings? Get help.
Wells Fargo blames computer for illegal foreclosures

Stream movies for FREE with Consumer Report pics
Your DNA test may influence your future insurance needs: rights vary or change.

Inflation rising: Shelter 41% of core CPI is running at a 3.5 percent annual rate.
You can lose SS benefits by NOT knowing the rules: Visit your local office.

Amazon taking your Defense secrets into cloud. Old computers are broken. Jeff has new!


Time for Pope to end celibate priesthood: Catholics and Church are ready for the change.

FL wakes up from ‘stand your ground’ BS: Black man had no gun. Not fair gunfight!

41 Watchung Plaza, B242
MontclairNJ   07042