35,000 wealthy households paid $0 tax

Rule for brokers to “do the right thing for the customer” put on hold …again

DOL and SEC likely will delay any moves until after Nov. vote. Lobbyists have been working on the delay for two years. Obama won’t push the “fiduciary” rules until after the election. We will have to wait to obtain this protection against the industry taking advantage of us—pushing bad and expensive products—with no full disclosure. Members assume there is no unbiased advice and buy direct for less:  http://www.amazon.com/Insiders-Guides-Discount-Financial-Services/dp/143480593X

Three investors beat up their advisor for losing $3.6 billion—investors, not advisor, sent to jail

Three German senior citizens were convicted last week of kidnapping and brutally beating their financial adviser. The unhappy trio, who range in age from 61 to 80, bound and gagged the adviser, James Amburn, broke two of his ribs, then tossed him in the trunk of a car for a 300-mile drive to a lakeside house. There, he was imprisoned in the basement. The three abductors were upset because the adviser lost $3.6 billion of their money on investments in Kuwait and Florida real estate. The trio forced Mr. Amburn, 58, to sign papers stating he would get them their money back. He faxed a note to SWAT who freed him. The investors, not the advisor, got 15 years.

Housing has become the new Gold

House hunters are flocking to foreclosures. Low mortgage and low price can’t be beat!

http://www.usnews.com/news/blogs/home-front/2012/05/30/house-hunters-flocking-to-foreclosures-for-value

Gold value dropping like lead during Ero crisis

It fell 6% in May alone. For many investors, this commodity was the refuge they dreamed about. It was considered the “safe” investment. It was nirvanna for GOP conservative Ron Paul. However, commodities do not hold their value over time. Like real estate, they go through bubble phases. How can you invest for the future in an unsettled world? Hang on! Money is pouring into index funds. There is the No Sweat Way: http://www.amazon.com/No-Sweat-Investing-your-money/dp/1469961687/ by Insider, Law Steeple.

401(k) fees could reduce the average nest egg by 30%, study says

The average U.S. couple could pay nearly $155,000 in fees for their 401(k) plans over their careers, according to a recent study. Compare how much you are paying at http://www.brightscope.com/401k-rating/367778/Google-Inc/372789/Google-Inc-401K-Savings-Plan/. If you earn 5% but pay 1.5%, and lose 2-3% to inflation, net 1%. 

http://www.latimes.com/business/la-fi-401k-fees-20120530,0,6918904.story

You can do something about it now before you lose $155,000. Lower fee plans are available. Use our http://www.amazon.com/The-New-American-Retirement-System/dp/1461030072

Boomers leaving money to charity not the kids

Leaving a legacy in a bequest was up nearly 19 percent in a year to almost $23 billion in 2010, according to the nonprofit Charity Navigator. Baby boomers have especially been interested in establishing a legacy. Three-fourths recently told pollsters that passing down family values and life lessons was more important than the monetary amount they're leaving in an inheritance, according to a recent survey by Allianz Insurance.

"We grew up in a do-good generation -- we were going to change the world," said Christine "Christy" Lambertus, a Fort Lauderdale board-certified, estate-planning attorney who is planning to leave a legacy. Members plan their wealth transfer wisely: http://www.amazon.com/Your-Retirement-Spending-Plan-enough/dp/1461084016

Is high-deductible health insurance right for you?

More than 13.5 million Americans are covered by Health Savings Account (HSA)-eligible insurance plans, a more than 18 percent increase since last year, according to a new census. If you have few health needs, this may the right plan for you. You buy a comprehensive policy that covers all major medical needs with a high deductible. This makes the cost reasonable. If you have surgery, all is covered after the first $3,000 for instance. If you have to buy insurance, the premium is cheaper than a HMO or PPO. The HSA is an account that lets you pay for your deductible and small out-of-pocket expenses with pre-tax income. This means that many self-employed people are going to pick this option in order to control their health and tax bills better. If you are offered this plan at work, take the expenses you had last year and compare to HMO costs. Make sure you can see specialists, your own doctor and hospital. Use our Guide to help you compare:

http://www.amazon.com/Industry-Insiders-Guides-Buying-Insurance/dp/1466435712/

ObamaCare benefits cited by Washington State officials

Reform would extend Medicaid coverage to 328,000 of the state's uninsured and give premium subsidies to another 477,400. Those who don’t have care would be able to use the state’s exchange to buy it. The Plan is not perfect but is better than the current lack of insurance for 74% of state’s uninsured residents. Three old white guys will decide to reverse the law of the land this month. Many pray.

http://insurancenewsnet.com/article.aspx?id=344296&type=lifehealth&inl=1

SCAMS           “Only the little people pay taxes.” Leona Helmsley

35,000 wealthy households paid NO taxes in 2009, says IRS this week

"Under Obama's plan, these people would almost certainly pay more. Under Romney's, they will almost certainly pay less." Percentage of high earners avoiding taxation on the rise; tax-exempt interest from muni bonds and charity are the main drivers. http://www.irs.gov/newsroom/article/0,,id=257605,00.html

Welfare for Rich: Farm bill gives payments to corp as soon as they claim revenue down

Agribusiness can start collecting as soon as their accountants can show a revenue drop. Corp will no longer have any risk of too much crop that lowers prices. The supply-demand market will not work. Prices will be supported. We will pay them more in subsidies as prices of bread etc fall. Deficits will rise. Senate takes up bill.

http://www.aei.org/article/economics/fiscal-policy/field-of-schemes-the-taxpayer-and-economic-welfare-costs-of-shallow-loss-farming-programs

US Corp CEOs hit jackpot—a $10 million average paycheck: Workers lose 7% and falling

The head of a typical public company made $9.6 million in 2011, according to an analysis by The Associated Press. That was up more than 6 percent from the previous year, and is the second year in a row of increases. The figure is also the highest since the AP began tracking executive compensation in 2006. Companies trimmed cash bonuses but handed out more in stock awards. For shareholder activists who have long decried CEO pay as exorbitant, that was a victory of sorts? http://www.usatoday.com/news/nation/story/2011-09-13/census-household-income/50383882/1

IAN

41 Watchung Plaza, B242

Montclair, NJ 07042

973.746.2014

www.InsuranceAdvisorsNetwork.com

Alerts available at http://dankeppel.blogspot.com/

Your broker may get fired soon

Your broker may get fired soon
The larger brokerage firms have decided they only want big money. According to one guru, “The wirehouses see themselves better off with one $1 million producer than four $250,000 producers.” James Gorman, CEO of Morgan Stanley, for example, is determined to raise pretax profit margins in the firm's wealth management operations from the current 11% toward his target of 20%. This week, the firm made changes to its adviser compensation grid — raising the penalty box threshold from $250,000 to $300,000 for lower-producing advisers. Those who don't meet the new production targets will see their payouts drop to 20%. That means that your broker must sell more than $1 million of products every year to survive. Brokers earn 25%-33% of the $300,000 revenue target or about $75,000 gross. You may be better off on your own since the pressure to sell you may become greater. The best investors say: “Snoring is the best way to create wealth.” amazon.com/Snoring-Best-Way-Create-Wealth/

MetLife is cutting the benefits of its annuity
Insurers are selling to investors’ fears by promising to pay a minimum monthly benefit sometime in the future: Talk of ending Social Security/pensions with market volitility.
Much of insurer’s cuts have been driven by big sales of the Guaranteed Minimum Income Benefit Max living-benefits rider, which has prompted MetLife to reduce the payout twice since launching the product in May. The GMIB Max, first released in May, provided a 6% income benefit and quickly became a favorite of advisers. Historically, this rate beats most conservative investments. However, when inflation goes back to the 3% norm, investors will be paying the annuity surrender charge to get out of the GMIB. Members take a planning approach to higher future retirement income rates using our help: Do Not Buy That Annuity: Create a Guaranteed Income plus Build your Wealth Reserve https://www.createspace.com/3716857


Who are the 1% class that protestors are talking about?
Anyone reporting $343,927 as AGI income according to the IRS. There were fewer than 1.4 million households that qualified for entry. They earned nearly 17% of the nation's income and paid roughly 37% of its income tax. Most of the top 1-percenters made over $1 million: $960,000, on average. Financial professionals made up about 14% of the top rank. Executives, managers and supervisors working outside of finance accounted for 31%. Medical professionals came in at 15.7%, while lawyers made up 8.4%. The problem is that this group’s income has doubled while the rest of us had no real increase. With so many descent jobs disappearing, there is no hope for improvement. Productivity gains have gone to the top. Workers do more for less. Their pensions have been stolen, according to amazon.com/Retirement-Heist-Companies-Plunder-American/dp/1591843332.

Is Auto insurance rate shopping worth it?
Dan of NJ just saved over $400 a year. He got a notice from his insurer last June that it was raising his rates through no fault of his own. In fact he had just completed the AARP safe driving course for another discount. The insurer was raising rates about $80 a year for his 2 older cars with full coverage for 2 older drivers. Recently, his college alum association sent a letter offering to cut rates with a new carrier. Dan’s wife had received a letter last month from her professional association offering to cut rates. Dan took one hour to shop both alternatives for exactly the same coverage. He then called his present carrier to see if they could beat the new rates from his alum’s company. No, they couldn’t. Dan signed up with the new carrier and saw his costs drop to $1,220 a year. He also learned that his old policy had a higher PIP benefit than he needed. PIP coverage pays his doctor bills AFTER his comprehensive health insurance reaches its max. But Dan has great coverage and will never have to use the small auto policy amount. He was wasted premiums every year for over 20 years. Dan used our Guide to buy only what he needed: amazon.com/Insiders-Guides-Discount-Financial-Services/dp/143480593X/


Do you wonder why the Occupy Wall Streeters are angry?
Your favorite companies like GE are making record profits AND getting a refund from your federal withholding tax payments. What is wrong with this picture. 30 companies paid nothing and some got refunds. 280 paid less than 10% of their profits. Wells Fargo had $49 billion in profits in 2008 through 2010, yet received a tax benefit of $651 million. http://www.ctj.org/pdf/12corps060111.pdf

SCAMS

Follow up on Bank America putting our money at risk AGAIN!
Two Democratic members of Congress on Thursday sent letters to Treasury Secretary Tim Geithner and other regulators expressing concern that Bank of America Corp had transferred derivatives from its Merrill Lynch subsidiary to its banking unit. If the brokerage bets go bad, we taxpayers would have to bailout the FDIC banking unit. The Fed gave BOA a pass to do this despite the new law. Have we not learned?

Debit fee issue becomes marketing tool--BoA gives in for now
Some large banks have withdrawn plans to raise fees in light of opposition to Bank American’s threat of $5 a month. Chase and Wells Fargo are joining the list of banks that won’t be charging customers to use their debit cards, as the backlash over Bank of America’s planned $5 monthly fee continues. Signs like, “I bailed out the banks and all I got was a $5 debit card fee” have been spotted the Occupy Wall Street protest in New York. Credit unions and community banks nationwide are reporting huge spikes in new accounts as consumers seek no-fee options. BoA gave up raising fee.

IAN
41 Watchung Plaza, B242
Montclair, NJ 07042
347.746.2014
www.InsuranceAdvisorsNetwork.com
Alerts available at http://dankeppel.blogspot.com/

12 things your agent/broker/banker/money-manager won’t tell you.

1. “We have FEES and COSTS for everything. Most are not necessary.” For instance, your life insurance policy is probably one with a higher premium than necessary. Compare the cost of $200,000 benefit for a 50 year old in good health--$356 versus $481 per year. [] It does not cost $50 to buy 200 shares of IBM. You can buy them for $0. [] And why should your broker charge you $160 when your account is inactive? [] Why are you paying 50 cents to deposit a check? Banks should pay you to deposit checks. [] Is your 401k money manager really worth 1.54% of your assets each year? And looses money too? Your employer should buy a retirement plan that costs you $0.30% or less with no kickbacks.

2. “We offer products that are best for our firm, not for you. We don’t show you all the fees and commissions and financial kickbacks and perks we earn when we sell you our products. Our products are the “best” available because we sell them. We are the best in the industry because our marketing image says we are.” One pension plan provider charges 2.75% a year for their tax-deferred annuity. It has 9 years of surrender charges so you can’t transfer your money if you change employers. It charges another $30 a year for ‘recordkeeping.’ Its mutual funds are among the poorest performers. [] One brokerage firm steered customers into their own funds because they have a higher broker payout. [] Your agent doesn’t sell SBLI, your broker doesn’t sell Vanguard, your banker does offer really free checking, and your money manager doesn’t price your funds at cost—0.1% or less.

3. “We will discuss your financial needs with half truths.” You are told you need $1,000,000 of life insurance but the policy type that your agent picks is the most expensive in the world. Even if you agree you need $1 million, you pay more for permanent, 30 year guarantee term or “return of premium” term than just term. [] You want a guaranteed income for the rest of your life but your broker doesn’t mention that the annuity payments loose half their value in 24 years. [] You want to save for college but your banker doesn’t mention that 529 plans are NOT taxed like the custodial account just opened for your child. You want to save for retirement but your broker put you in two 'hot' funds.

4. “We don’t tell you about other alternatives. We don’t get paid to tell you there are less expensive alternative ways to solve your problems.” You can buy a FREE checking account from your credit union. The CDs pay more, the checking costs less and the loans are cheaper. You don’t need an ATM on every corner. [] You can defer taxation on your account earnings by buying and holding stocks or tax-managed funds. [] You can save on liability insurance by buying only what you need. [] Wealthy people buy “assets that grow by themselves” so they can self-insure and self-fund their needs. [] Consumer Reports reviewed 47 LTC policies and concluded that “for most people, long-term-care insurance is too risky and too expensive.”

5. “We don’t explain how you can reach your goals in the least costly way.” Banks offer life insurance to cover your loan because you want to get the loan. They don’t explain that your existing term policy will cover the loan. [] You can build a much larger retirement nest egg by investing in stock mutual funds costing .07% vs. 1.3%. Compounding magnifies the difference—20% more money over time. [] When new employees sign up for the retirement plan they are encouraged to pick the ‘safest’ option—treasury bonds. Stocks are more likely to grow in value over the long term than treasuries.

6. “Our products must be ‘sold not bought. We use half-truths in order to contrive an ‘urgent financial need’ that you can solve only by buying our products.” One firm charged a 91-year-old “client” more than $35,000 for four trades over two years, at approximately $8,800 per trade. [] The largest annuity seller is accused of misleading policyholders regarding bonus payments promised on annuity products. [] Life insurance is not the foundation of every financial plan—you are more likely to run out of money than die in the 21st Century.

7. “We believe the hype of our industry: We give good financial advice that you can’t get anywhere else.” There are no classes in our high schools called Financial Health Class. You can’t easily find out the “tricks of the trade” used to sell you the products created to pay high fees to sellers. Young single people don’t need life insurance. They need to invest 10% of their income at an early age to reach their goals and become wealthy. [] If brokerage firms actually followed their own stock selection advice, they would have negative returns. The average return for the top 10 brokerage firms was minus 2.26% from 1997-2001! Most were negative (Investars). 88% of managed mutual funds earn less than the market. You are better off making your own mistakes. http://www.theinsidersguides.com/doityofi.html

8. “We are experts at figuring out what your “hot buttons” are and using them to get you to buy our products. We exploit the fact that everyone wants to buy the next Google stock or become a millionaire overnight buying and selling real estate or gold. We exploit the fact that seniors fear losing money and want to earn 10% on their money with a completely guaranteed investment.” Finding the next Google is like finding a dime in a football field on the first try. The average equity investor earned a paltry 2.57% annually; compared to inflation of 3.14% and the 12.22% the S & P 500 index earned annually, 1984-2002. [] You pay for guarantees by earning less and not keeping up with inflation. So even though you don’t lose money, inflation reduces your money’s buying power. Putting your money into different risky investments reduces your chances of losing money and increases your chance of beating inflation. The stock market returns about 11% over time. See chart: http://www.theinsidersguides.com/doityofi.html

9. “We don’t sell products from companies that don’t pay a commission—so you never obtain the least-cost product. We only sell products with commissions and fees and kickback incentives and “soft dollar” reimbursements.” When was the last time your broker offered the mutual funds with the highest returns over a 20-year period? Vanguard Primecap--13.6% over 20 years--#1 in large company growth stock funds. Vanguard Health--17.4% over 20 years--#1 in Sector funds. Vanguard Energy--16.4% over 20 years--#2 in Sector funds. [] Did your agent call to tell you that life insurance rates are dropping so you should apply? [] Did your auto agent mention that rates have fallen? [] Did your banker mention that internet banking is FREE? [] Where do you find the highest CD rates?

10. “We charge you fees whether we give good service, good rates, good returns, or good benefits.” One money manager charges 1.5% for the same exact fund that charges .07%. With $250,000 invested, you will give up about $700,000 (2,723,138 vs. 2,022,979 over 20 years of compounding at market rates). Only 12% of managers can beat their benchmarks over long periods of time. You don’t get a refund if your manager can’t beat the index. [] You can’t get a refund if your CD or annuity renews at a lower rate. [] You can’t get a refund if we mess up your trustee to trustee transfer. You don’t receive a “better” death benefit check for $200,000 when your loved one dies. [] Many banks hit customers for fees they didn’t tell them about. Only the lawyers knew.

11. “When things go wrong, we treat you like you’re the enemy.” All brokerage firms disallow you to sue for bad service—you must use their arbiter and settle for the decision. One firm has the worst call response service in the industry. [] One company pressured outside engineers to prepare reports concluding that damage was caused by water rather than by wind. They just denied all of them in the same geographic area. [] Another insurer dropped coverage and stopped signing new policies in coastal areas of 9 states. [] Some long term care insurers aren’t paying claims.

12. “We don’t care if you have been a loyal customer. We buy and sell customer accounts anytime we can make more money from it.” In the last few years, hundreds of customers have had their accounts transferred out of area. For instance, John Hancock’s president sold the company to Manulife [Canada], Fireman’s Fund was sold to Allianz [Germany], Household Finance went to HSBC [Hong Kong], and Sage Life went to Old Mutual [S. Africa]. Brown & Co and HarrisDirect went to E*Trade. Golden West Financial went to Wachovia. MBNA and Fleet Bank went to Bank of America. A complete list is available at http://www.theinsidersguides.com/whoowyoacno.html. More consolidation is expected: HSBC, Rydex, Gateway Investment, GAMCO Investors, Julius Baer Investment, UBS AG. Your accounts could be next. You can do it yourself and save.

"Investors should purchase stocks [financial services] like they purchase groceries—not like they purchase perfume…” Benjamin Graham

See Today’s Savings Ideas at TheInsidersGuides.com
© 2007 IAN,llc