Investment http://www.wisebread.com/taxonomy/term/4808/all en-US 5 Easy Ways to Start Green Investing http://www.wisebread.com/5-easy-ways-to-start-green-investing <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-easy-ways-to-start-green-investing" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_recycling_000013114340.jpg" alt="Woman happy because she made environmentally friendly investment" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>We'd all love to invest our money in a way that benefits our finances while helping to build a better world. If that sounds like a pipe dream to you, it's not. Impact investing is a growing trend, and there are plenty of ways to do well and do good with your money. Here are five classes of green investments that are kind to the Earth:</p> <h2>1. Green Bonds</h2> <p><a href="http://www.institutionalinvestor.com/gmtl/3382260/Green-Bonds-Planting-Seeds-for-Eco-Friendly-Investment.html#.VRmawpPF-l0">Green bonds</a> are a perfect entry point for someone interested in making a social investment. Like other bonds, you pay a certain amount of money for the bond now to get a larger amount of money at a specific future date. With green bonds, your up-front investment is used to finance environmentally friendly projects. They're relatively low-risk and provide critical funds that are urgently needed in the short-term for these green initiatives.</p> <h2>2. Green Mutual Funds</h2> <p>Chances are that if you have any type of retirement account, at least a portion of it is invested in mutual funds. If you'd like to use that money to support green projects, choose green funds when allocating your investments. Broadly speaking, these investments are also included under the umbrella of socially responsible investments.</p> <h2>3. Green Stocks</h2> <p>As an investor, you also have the option to invest directly in companies that have a green mission, product, or service. This means you can buy stock in a publicly traded company that produces renewable energy products such as solar panels, or any other &quot;green&quot; mission of your choice.</p> <h2>4. Green Startups</h2> <p>One of the riskiest (but perhaps one of the most potentially lucrative) green investments you can make is in a green startup. There are plenty of entrepreneurs who are founding companies in the environmentally-friendly space. They range from new composting techniques, to energy-saving products, to innovative concepts such as carbon credits that are bought and traded to compensate for energy consumption.</p> <h2>5. Sustainable Product Stocks</h2> <p>Many companies are taking up the green mantle by transforming their products and using renewable resources. Some also pledge a portion of their earnings to environmental nonprofits, and support green efforts in the communities where they operate. These companies can contribute enormously to protecting the environment, and supporting their efforts with your investment dollars and purchases can help encourage them to continue and enhance these practices.</p> <p>As always, it's important to make informed investment decisions. It's best to educate yourself about these options by reading about the ins and outs of green investing. I also suggest seeking the advice of a professional financial advisor before making any investment decisions. Together, we can build a bright future for ourselves and for the planet as a whole through our investment dollars.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/christa-avampato">Christa Avampato</a> of <a href="http://www.wisebread.com/5-easy-ways-to-start-green-investing">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-invest-in-the-stock-market">Why invest in the stock market?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-crucial-things-you-should-know-about-bonds">5 Crucial Things You Should Know About Bonds</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/socially-responsible-investing-goes-green">Socially Responsible Investing Goes Green</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-5-best-reasons-to-start-investing-in-bonds-now">The 5 Best Reasons to Start Investing in Bonds Now</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/your-401-k-is-not-an-investment">Your 401(k) is not an investment</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Green Living Investment bonds eco-friendly environment mutual funds startups stocks sustainability Wed, 15 Apr 2015 11:00:12 +0000 Christa Avampato 1380916 at http://www.wisebread.com 5 Ways to Boost Your Odds of Retiring Early http://www.wisebread.com/5-ways-to-boost-your-odds-of-retiring-early <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-ways-to-boost-your-odds-of-retiring-early" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/guy_computer_000025658945.jpg" alt="Man trying to boost his odds of retiring early" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The <a href="http://crr.bc.edu/briefs/the-average-retirement-age-an-update/">average age of retirement</a> stands today at 62 for women and 64 for men. But if you're like many Americans, you'd probably much prefer to have your feet in the sand and a piña colada in hand well before you reach your 60s. No matter your age, it'll be pretty hard to pay for that oceanfront real estate and tiki bar tab if you haven't set aside enough savings.</p> <p>Fortunately, your dreams of a comfortable, early retirement can still come true &mdash; so long as you're willing to do some heavy duty planning, smart saving, and savvy investing. Read on for our roundup of the best tips and tricks for retiring early &mdash; without winning the lottery.</p> <h2>1. Set a Savings Goal</h2> <p>First thing's first: You need to calculate how much money you'll need to stockpile before you can quit your day job. Be forewarned &mdash; it'll likely be a number that will make your jaw drop. But even if it seems totally unattainable, rest assured that it's not. Let's say you'd like to retire at 48 &mdash; a plum 15 years earlier than the average American. Take your pre-retirement income and multiply it by the number of expected years of life you'll have in retirement; in this case, we'll say it's 48 x 31 (this assumes you're going to live to be 79, the average life expectancy for an American).</p> <p>For example, if you're living off a $70,000 salary now, you'll need to save $2.2 million before you can ditch your nine-to-five. On average, retirees spend between 65% and 95% of their<a href="http://www.forbes.com/sites/fidelity/2015/03/23/are-you-on-track-for-the-retirement-you-want-infographic/?sr_source=lift_polar"> pre-retirement income</a>, so this calculation shoots a little high. But since you very well may live a decade or two longer than the average Joe, it's better to have a bigger cushion than no cushion at all.</p> <h2>2. Live Frugally</h2> <p>If you want to achieve a comfortable, early retirement, one way of getting there is by living frugally. That means forgoing name brand clothing, coupon-less meals at restaurants, salon visits, and airplane travel. Buying used cars only &mdash; or giving up cars, altogether and instead riding a bike or public transit. (See also: <a href="http://www.wisebread.com/the-two-biggest-mistakes-people-make-when-starting-to-live-frugally?ref=seealso">The Two Biggest Mistakes People Make When Starting to Live Frugally</a>).</p> <p>If this sort of lifestyle sounds foreign to you, you may want to begin by crafting a carefully detailed budget that will set you up to achieve your long-term retirement savings goal. If all of this sounds exactly like the way you don't want to live out your younger years, frugal living as a road to early retirement quite simply may not be for you.</p> <h2>3. Start a Business &mdash; Then Let Someone Else Run It for You</h2> <p>If you've got an entrepreneurial bone in your body, you might want to explore launching your own business as a means of achieving early retirement. Whether it's a food truck or a marketing and consulting firm, the idea is to launch the business and work it until it's profitable enough that you can hire someone else to run the day-to-day operations while you kick back in that beach chair and watch the money pour in. Alternatively, the sale of your business could fund your retirement. Nearly 40% of small business owners say they are <a href="http://www.guardianlife.com/glife11pp/groups/camp_internet/@stellent_camp_websites/documents/document/sbo-retirement-readiness.pdf">poised to retire earlier</a> than they had anticipated. (See also: <a href="http://www.wisebread.com/starting-your-dream-business-is-easier-than-you-think-heres-how?ref=seealso">Starting Your Dream Business Is Easier Than You Think &mdash; Here's How</a>)</p> <h2>4. Get Yourself a Pension</h2> <p>The beauty of the pension plan: It's sort of like earning a salary, only without having to put in the work. And although many industries are phasing out these plans, about one in four large employers still offer some sort of <a href="http://www.towerswatson.com/en/Insights/Newsletters/Americas/Insider/2014/retirement-in-transition-for-the-fortune-500-1998-to-2013">pension to new hires</a>, according to a recent study. At the top of the list are companies in the insurance, utilities, energy, transportation, and food and beverage industries. Government is another sector where pensions are alive and well. Many municipalities still offer firefighters, police officers, and public works employees pensions that include overtime and saved vacation in the final calculation. The result is that some workers can retire with a pension that's <a href="http://www.ctpost.com/local/article/Crushed-by-town-pensions-1413396.php">higher than their former salary</a>. Imagine that.</p> <p>Alternatively, Apple, Google, Microsoft, and other big-name employers in the <a href="http://money.usnews.com/money/retirement/slideshows/10-industries-with-the-best-retirement-benefits/10">information industry</a> offer workers an average retirement benefit contribution of $2.76 per hour worked. That's huge. Also, these tend to be pretty high-paying jobs, which means employees have more flexibility to make larger contributions to their own retirement savings, in addition to what the company chips in.</p> <h2>5. Make Smart Investments</h2> <p>The best time to start investing is now. Case in point: If you start maxing out your IRA contributions at age 25, you will have saved $1.6 million by the time you're 70. But if you were to start at 35, you'd save about half that sum. Clearly, a few years can make a huge difference. Now, if you're not investment savvy, there are tons of tools available to help you figure out where to put your money.</p> <p>One of the best and easiest is an automated investment advisor, such as FutureAdvisor, that specializes in retirement planning. With <a href="https://www.futureadvisor.com/">FutureAdvisor</a>, you can get your 401(k), IRA, and other accounts analyzed, plus receive recommendations on how to improve your existing investments &mdash; absolutely free of charge. Then, if you're impressed with the results and want to hire FutureAdvisor as your investment manager, there's a monthly fee of either $9 or $19, depending on the value of your assets. Rest assured, all of FutureAdvisor's investment recommendations are made with the goal of setting you up for the most comfortable retirement years possible.</p> <p><em>What other steps are you taking to ensure an early retirement?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/brittany-lyte">Brittany Lyte</a> of <a href="http://www.wisebread.com/5-ways-to-boost-your-odds-of-retiring-early">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/12-surprising-things-women-should-know-about-retirement-planning">12 Surprising Things Women Should Know About Retirement Planning</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-times-raiding-your-retirement-accounts-early-is-okay">4 Times Raiding Your Retirement Accounts Early Is Okay</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-despair-over-small-retirement-savings">Don&#039;t Despair Over Small Retirement Savings</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-start-a-business-with-your-401k">How to Start a Business With Your 401(k)</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/retirement-accounts-and-money-to-spend">Retirement accounts and money to spend</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Entrepreneurship Investment Retirement 401(k) pensions savings Tue, 14 Apr 2015 09:00:42 +0000 Brittany Lyte 1379696 at http://www.wisebread.com 7 Stocks Warren Buffett Loves — And You Should, Too http://www.wisebread.com/7-stocks-warren-buffett-loves-and-you-should-too <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-stocks-warren-buffett-loves-and-you-should-too" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/binoculars_000012990755.jpg" alt="Man looking towards wealthy financial future with stocks" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Warren Buffett is one of the <a href="http://www.stockpickr.com/pro/portfolio/warren-buffett/">most successful investors</a> of all time. He's also famous for living modestly (he still occupies a very middle class home in Omaha and drives an older vehicle) and investing in products that can be easily understood by anyone. (That's enough to make any Wise Bread reader swoon.) Here are seven of the stocks he loves that we should all seriously consider for our portfolios:</p> <h2>1. Wells Fargo</h2> <p>Mr. Buffett devotes almost a quarter of his stock portfolio to <a href="https://www.google.com/finance?q=NYSE%3AWFC&amp;ei=1MEhVfnmJMje8AbPoYBQ">Wells Fargo</a>. Many financial services stocks boomeranged during the recession. In this instance, Wells Fargo's diversification helped cushion them from the losses and rock bottom stock prices that many of their competitors experienced during the depths of the financial crisis. Its motto could be simply stated as &quot;steady as it goes.&quot; And if there's anything that Mr. Buffett likes, it's stability.</p> <h2>2. Coca-Cola</h2> <p><a href="https://www.google.com/finance?q=NYSE%3AKO&amp;ei=38EhVdn8PIGB8Abn94HoAg">Coca-Cola</a> is synonymous with Americana. I still remember the iconic commercials from my childhood, and its polar bears remain a staple of Christmas advertising. All of the nostalgia aside, the world's most famous beverage (and brand) has held its value. For almost 40 years, it's steadily climbed its way up in price from $0.81 per share in 1978 to almost $41 per share in 2015.</p> <h2>3. American Express</h2> <p><a href="https://www.google.com/finance?q=NYSE%3AAXP&amp;ei=9sIhVYnQHOqysAftxoHIAQ">American Express</a> zeroes in on wealthier customers who tend to experience less strife during a difficult economy. Though Amex experienced a significant decline in its stock price during the most recent recession, it has since bounced back nicely. Since its low of $10 in 2009, the stock has clawed its way back to almost $80 per share, significantly higher than its share price prior to the recession.</p> <h2>4. IBM</h2> <p><a href="https://www.google.com/finance?q=NYSE%3AIBM&amp;ei=I8QhVfm0C4uM8Qb07YGIBg">IBM</a> is a bit of a roller coaster stock if we focus on any short-term timeframe. However, if we zoom out and take a look at its performance over the long-haul, we see that the highs outweigh the lows. Mr. Buffett is famous for taking the long view, and IBM is a great example of the value of this perspective. Since the doldrums of 2009, IBM has doubled its per share price.</p> <h2>5. Wal-Mart</h2> <p>There's plenty of criticism in the press when it comes to <a href="https://www.google.com/finance?q=NYSE%3AWMT&amp;ei=vMQhVfnmJIWB8wbr24HADw">Wal-Mart's</a> business practices. Many take umbrage with its employee practices and environmental policies. But when it comes to making an investment in a company that provides returns, Wal-Mart is another stock that consistently delivers for its shareholders. Even during the latest recession when many other companies were bottoming out, Wal-Mart held its value. In the past 20 years, its stock price has grown more than seven times over.</p> <h2>6. Procter &amp; Gamble</h2> <p>Open up your medicine cabinet or look under your sink, and chances are you've got at least one <a href="https://www.google.com/finance?q=NYSE%3APG&amp;ei=ucUhVbj8CIGB8Abn94HoAg">Procter &amp; Gamble</a> product that's a staple in your daily life. Mr. Buffett loves companies like this because they are such a part of the fabric of American consumer's habits. P&amp;G is an innovation leader with a careful and thoughtful eye toward improving the lives of its customers through its products. This commitment shows in its stock price, which has grown by over 28% in the past five years.</p> <h2>7. U.S. Bancorp</h2> <p>Like many of Mr. Buffett's other stock picks, <a href="https://www.google.com/finance?q=NYSE%3AUSB&amp;ei=PckhVaGWA-zBsAeP_oCADg">U.S. Bancorp</a> has been on an upward climb since the depths of the latest recession. Though it hasn't seen a dramatic rise in price like American Express and Wal-Mart, it's nonetheless a solid bet thanks to its business spanning the full range of financial services from retail banking, to capital markets, to investment management.</p> <p>In Mr. Buffett's portfolio we immediately notice one obvious pattern &mdash; he invests in brands that are well-known and ubiquitous to American life. In the days of flashy startups, over-the-top IPOs, and Silicon Valley's flashes in the pan, Mr. Buffett provides us with a salient counter example for the prudent investor: invest in what you know and in what everyone else knows, too.</p> <p><em>Do you own any of Warren Buffett's favorite stocks? If so, which ones and why?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/christa-avampato">Christa Avampato</a> of <a href="http://www.wisebread.com/7-stocks-warren-buffett-loves-and-you-should-too">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-easy-ways-to-start-green-investing">5 Easy Ways to Start Green Investing</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-invest-in-the-stock-market">Why invest in the stock market?</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-investors-with-better-returns-than-warren-buffett">5 Investors With Better Returns Than Warren Buffett</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-crucial-things-you-should-know-about-bonds">5 Crucial Things You Should Know About Bonds</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/your-401-k-is-not-an-investment">Your 401(k) is not an investment</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment investors stock portfolios stocks Warren Buffett Mon, 13 Apr 2015 17:00:04 +0000 Christa Avampato 1380770 at http://www.wisebread.com Here's How Rich You'd Be if You Stopped Drinking Expensive Coffee http://www.wisebread.com/heres-how-rich-youd-be-if-you-stopped-drinking-expensive-coffee <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/heres-how-rich-youd-be-if-you-stopped-drinking-expensive-coffee" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_coffee_000021560271.jpg" alt="Woman drinking expensive coffee and spending too much money" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Last week I was in Starbucks, and found they now have a list of enticing new lattes. One was <em>tiramisu</em>! Starbucks will be glad to know that the tiramisu latte did not disappoint. On taste, that is. The price tag for a tall tiramisu latte with coconut milk in my area is a staggering $5. That's right: <em>five dollars</em>. For what ultimately amounts to a small coffee with some flavors and milk substitute thrown in. Oh my.</p> <p>Fortunately for my pocketbook, I usually home brew. I have a very nice coffee maker that had an upfront cost the equivalent of 40 tall tiramisu lattes with coconut milk (after my 20% Bed Bath and Beyond coupon). Sure, it was expensive, but like I said; I'm a coffee lover, and the coffee it auto-grinds and brews is so delicious that I'm often disappointed when I'm out and have to buy from a coffee shop. (See also: <a href="http://www.wisebread.com/better-brewing-12-ways-to-make-coffee-at-home?ref=seealso">12 Ways to Make Better Coffee at Home</a>)</p> <p>Before I get all annoying and tell you how much your five-dollar-a-day coffee habit is costing you, I want you to know that I'm not picking on Starbucks. You can run the same numbers by picking your favorite brew from Peet's or Caribou or Costa, or wherever you happen to frequent. Heck, skip the coffee analogy altogether and substitute cigarettes, a microbrew at your local hang-out, cable TV, or whatever daily vice you think is harmless to your pocketbook.</p> <p>What's most important is that, before you make even the smallest of financial decisions, you understand the big picture effect. Maybe you'll decide your daily latte is worth the long-term price. But, before you decide, you should understand the variables. (See also:&nbsp;<a href="http://www.wisebread.com/73-easy-ways-to-save-money-today?ref=seealso">73 Easy Ways to Save Money Today</a>)</p> <h2>$5 a Day for 40 Years Could Buy a House (in Today's Dollars)</h2> <p>If you took $5 a day and put it in an 8% investment like a low-cost, well diversified index fund (I love Vanguard, if you're looking for one!) for 40 years, that daily foregone latte could compound to a staggering $510,600.40. Don't want to wait 40 years? The daily tiramisu latte habit adds up to $1,971 over a year, $11,563,07 over five, and $28,553.01 over 10. Just think about all the vacations you could take with that extra dough, or all the kids' college accounts you could fund, or all the debts you could pay off (and save yourself the interest payments!). The possibilities are endless. (See also:&nbsp;<a href="http://www.wisebread.com/this-is-how-rich-youd-be-if-youd-saved-the-money-you-earned-in-high-school?ref=seealso">This is How Rich You'd Be if You'd Saved All the Money You Earned in High School</a>)</p> <h2>But I Don't Want to Give Up That Much Coffee</h2> <p>I love coffee, even the five dollar variety, even though I know how much it costs to my long-term bottom line.</p> <p>Drop just one froufrou cuppa from your weekly routine and you'll still see great investment results. Assume again you take that $5 per week and invest it in that low-cost index fund (which we'll assume returns 8% per year) and you'll earn $280.80 per year, $4,067.83 in 10, and $72,743.07 after 40 years. It's no McMansion in the burbs but $70k is still enough for a double wide in the country or a condo in the city. (See also:&nbsp;<a href="http://www.wisebread.com/how-to-save-26000-in-5-years-or-less?ref=seealso">How to Save $26,000 in 5 Years or Less</a>)</p> <h2>No, Really, I Just Can't Give up My Coffee</h2> <p>I get it. Really, I do. Sometimes a daily habit means more than what we have to gain by giving it up. So, in my last ditch effort to show you that little changes lead to big results, let's see how much you have to gain by giving up just one fancy coffee per month.</p> <p>In one year (assuming an 8% annual return): $64.80. In 10: $938.73. In 40: $16,786.86. Even giving up just one $5 coffee per month can make a sizable difference over time. (See also:&nbsp;<a href="http://www.wisebread.com/16-easy-ways-to-save-100-this-month?ref=seealso">16 Easy Ways to Save $100 This Month</a>)</p> <p>Just for fun, here's an expanded version of the numbers so you can choose your own timeframe and dollar savings.</p> <p><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5171/coffee%20savings%20chart%20-%20tweddale.jpg" width="605" height="389" alt="" /></p> <p>The next time you find yourself pulling a fiver out of your wallet for a seemingly inconsequential expense, I hope you'll think twice and consider the long-term cost of that impulse buy. Just plug the cost of that impulse buy into a <a href="http://www.bankrate.com/calculators/savings/compound-savings-calculator-tool.aspx">compound savings calculator</a> and see how much you'll save &mdash; and earn. Over time, the decision could just fund your next home, vacation, or child's college tuition. Or, Howard Schultz's pocketbook. The choice is yours.</p> <p><em>What daily expense would you be willing to give up for a house in 40 years?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/alaina-tweddale">Alaina Tweddale</a> of <a href="http://www.wisebread.com/heres-how-rich-youd-be-if-you-stopped-drinking-expensive-coffee">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-ways-to-save-money-when-you-are-unemployed">10 Ways to Save Money When You Are Unemployed</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/13-dumb-little-purchases-you-need-to-stop-making-today">13 Dumb Little Purchases You Need to Stop Making Today</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-save-26000-in-5-years-or-less">How to Save $26,000 in 5 Years or Less</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-dumb-little-budgeting-mistakes-you-need-to-stop-making-today">10 Dumb Little Budgeting Mistakes You Need to Stop Making Today</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-false-allure-of-compound-interest">The False Allure of Compound Interest</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Budgeting Investment coffee coffee drinkers compound interest money saving tips spending Tue, 07 Apr 2015 09:00:10 +0000 Alaina Tweddale 1370567 at http://www.wisebread.com 8 Ways ETFs Can Put More Money in Your Pocket Than Mutual Funds http://www.wisebread.com/8-ways-etfs-can-put-more-money-in-your-pocket-than-mutual-funds <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/8-ways-etfs-can-put-more-money-in-your-pocket-than-mutual-funds" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_at_work_000019464427.jpg" alt="Man discussing ETFs and mutal funds with woman" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>One of the most common pieces of investment advice is to diversify your portfolio. This means having a good mix of investments, including stocks from a variety of asset classes and industries.&nbsp;Mutual funds have long been the most common way for investors to easily diversify their portfolios, but there's a relatively new investment vehicle that is arguably better.</p> <p><a href="http://www.wisebread.com/exchange-traded-funds-the-low-fee-investment-option-you-dont-know-about">Exchange-traded funds, or ETFs</a>, have many advantages over mutual funds, and should be a part of most investment plans. ETFs are very much like mutual funds, in that they are designed to track a particular index, such as the S&amp;P 500, or industries like health care or tech. But unlike mutual funds, they can be bought and sold just like stocks. (See also: <a href="http://www.wisebread.com/the-top-5-etfs-you-should-buy-now?ref=seealso">The Top 5 ETFs You Should Buy Now</a>)</p> <p>There are now more than 1,000 ETFs available for most investors, and they are growing in popularity. Here's a look at some key <a href="http://www.wisebread.com/the-duel-etfs-vs-mutual-funds">advantages of ETFs over mutual funds</a>.</p> <h2>1. Expense Ratios Are Lower</h2> <p>Generally speaking, you will keep more of your money if you trade an ETF over a mutual fund. Most ETFs have expense ratios of less than 1%, and there are some &mdash; such as the iShares Total Stock Market ETF [ITOT] &mdash; which have ratios of under 0.1%. (Disclosure: A significant portion of my Roth IRA is invested in this ETF.)</p> <h2>2. You Can Trade Many ETFs Without a Commission</h2> <p>Depending on the brokerage, you can buy or sell many ETFs at no charge. Fidelity, for example, charges no commission for iShares ETFs, and TD Ameritrade has more than 100 commission-free ETFs. This will save you a great deal of money, especially if you like the idea of buying small quantities of ETFs frequently.</p> <h2>3. They Trade All Day on the Exchange</h2> <p>Unlike mutual funds, ETFs are available for intraday trading. This means that you can buy them or sell them quickly if you believe the market may go up or down sharply during the day, and also place limit orders, which allow you to direct your broker to buy or sell only at a specific price.</p> <h2>4. You Can Take Short or Long Positions</h2> <p>Because ETFs trade like stocks, you can use them in options trades. This means you can potentially profit from a down market. For example, if you believe an ETF will lose value, you can &quot;borrow&quot; shares and then sell them at a higher price using the proceeds to buy them back at a lower price in the future. (Note: This investment activity is complex and generally for more experienced investors.)</p> <h2>5. They Offer Tax Advantages</h2> <p>ETFs are built to be tax efficient. They are generally passively managed, so they do not produce as much in the way of capital gains. ETF managers are also not required to sell shares &mdash; and thus produce capital gains &mdash; to accommodate the redemption of shares.</p> <h2>6. There Are No Minimums</h2> <p>It's possible to buy or sell just a single share of an ETF. Contrast this to many mutual funds that have minimum investment requirements into the tens of thousands of dollars.</p> <h2>7. Dividends Are Not Automatically Reinvested</h2> <p>There's nothing necessarily wrong with reinvesting dividends, but mutual funds don't even give you a choice. With ETFs, dividends are placed into your brokerage account. If you want to buy more shares of that same ETF, you certainly can, but you're given the flexibility to put the cash elsewhere.</p> <h2>8. There's a Big Selection, But It's Not Overwhelming</h2> <p>According to the Investment Company Institute, there were <a href="http://www.ici.org/etf_resources/background/faqs_etfs_market">1,411 available ETFs</a> in the U.S. at the end of 2014. Compare that to about 7,400 mutual funds. The number of ETFs at this point should offer investors plenty of ways to diversify their holdings any way they choose, without drowning them in a sea of confusing choices.</p> <p><em>Do you own ETFs? Why or why not?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/tim-lemke">Tim Lemke</a> of <a href="http://www.wisebread.com/8-ways-etfs-can-put-more-money-in-your-pocket-than-mutual-funds">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-cheap-easy-and-not-so-obvious-ways-to-invest-in-a-companys-stock">8 Cheap, Easy, and Not-So-Obvious Ways to Invest in a Company&#039;s Stock</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-duel-etfs-vs-mutual-funds">The Duel: ETFs vs. Mutual Funds</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-easy-ways-to-start-green-investing">5 Easy Ways to Start Green Investing</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-best-online-brokerages-for-your-ira">5 Best Online Brokerages for Your IRA</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-ways-to-beat-the-stock-market-in-2015">4 Ways to Beat the Stock Market in 2015</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment ETFs exchange traded funds mutual funds Thu, 02 Apr 2015 11:00:12 +0000 Tim Lemke 1360989 at http://www.wisebread.com 10 Investing Lessons You Must Teach Your Kids http://www.wisebread.com/10-investing-lessons-you-must-teach-your-kids <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/10-investing-lessons-you-must-teach-your-kids" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/mother_son_money_000014942268.jpg" alt="Mother talking to her son about investments" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Roughly 68% of Americans feel that <a href="https://www.wellsfargo.com/about/press/2014/middle-class-retirement-saving_1022/">saving for retirement</a> is harder than they anticipated. Some 25% of all middle-class Americans &quot;get depressed&quot; when even thinking about it. And 40% of millennials have no idea how much <a href="https://www.wellsfargo.com/press/2014/20140610_millennials">money to save</a>. The most frightening statistic: 21% of Americans think that <a href="http://www.consumerfed.org/pdfs/Financial_Planners_Study011006.pdf">winning the lottery</a> is the most practical way for them to fund their retirement.</p> <p>I discussed these problems and the financial behavior of investors with Rob Pivnick, a financial literacy advocate and author of &quot;<a href="http://www.amazon.com/gp/product/B00NDHXOH8/ref=as_li_tl?ie=UTF8&amp;camp=1789&amp;creative=9325&amp;creativeASIN=B00NDHXOH8&amp;linkCode=as2&amp;tag=wisbre03-20&amp;linkId=5MOTCBD3L7AR5A2F">What All Kids (and Adults Too) Should Know About...Saving &amp; Investing</a>.&quot; His message is that parents should teach their children the right habits as early as possible, so they don't become one of these statistics. And it doesn't have to be difficult. Here are 10 easy ways to teach your children about smart investing.</p> <h2>1. Start Them Off Early</h2> <p>Starting to save as early as possible is the easiest way to let your money work for you. In fact, this is probably the number one thing you can teach your children about money.</p> <p>Consider this example from Rob's book comparing two savers: One starts saving when he is 20 years old, while the other waits until she is 30 years old. Each one saves $100 per month until they are 60 years old, and they both get the same 8.5% return. The early saver will have $406,825. The saver who waited ten years will only accumulate $166,339. That 10 year difference results in over $240,000 more growth! But the difference in the amount contributed was only $12,000 &mdash; compound interest made up all the rest. So, encourage your children to start investing now.</p> <h2>2. Don't Try to Beat the Market</h2> <p>Your kids should want to be average &mdash; at least when it comes to investing. It is better to embrace the market than try to beat the market. It isn't very often in life that you won't tell your children to try to be the best, but when it comes to investing, teach them to be average. Passive management, or indexing, is an investment approach that tries to match the performance of the market as closely as possible rather than try to beat it.</p> <p>Over the long term, it is impossible to consistently beat the market without taking on additional risk. Over just about any historical five year period, passive index funds beat actively managed funds. Over the last five years, for example, only 20% to 35% of <a href="http://www.spindices.com/documents/spiva/spiva-us-mid-year-2014.pdf">actively managed funds</a> beat the benchmark for their category. The professionals aren't smarter than the market. And neither are you (or your kids). It's a humbling fact, but still a fact nonetheless. (See also: <a href="http://www.wisebread.com/5-investors-with-better-returns-than-warren-buffett?ref=seealso">5 Investors With Better Returns Than Warren Buffett</a>)</p> <h2>3. Minimize Expenses: Invest in Low-Cost Index Funds</h2> <p>Actively managed funds have an average expense ratio of a full percentage point higher than passive funds. One percent may not sound like much, but over the long term it becomes much more significant. How does this translate into lost dollars? Well, from another example in Rob's book, if you invested $100,000 over 30 years at an average yearly growth of 8.5%, paying for those higher fees would cost you approximately $280,000. (See also: <a href="http://www.wisebread.com/3-steps-to-getting-started-in-the-stock-market-with-index-funds?ref=seealso">3 Steps to Getting Started With Index Funds</a>)</p> <p>Everyone should know that past performance is no indication of future returns. But does everyone know that the most accurate predictor of future returns is low fees? When looking at factors like past performance, fees, and Morningstar ratings, expense ratios are the only reliable predictor of future performance.</p> <h2>4. Think Long Term: Buy and Hold Is the Best Strategy</h2> <p>The average <a href="http://www.dalbar.com/ProductsampServices/AdvisorsSolutions/QAIB/tabid/214/Default.aspx">investor's annual return</a> is around 4%. That's compared to the historical average market return of 8.5%. Why? Because we tend to invest emotionally &mdash; which causes us to buy high, and sell low (instead of the opposite).</p> <p>Emotional investing is a losing strategy. Don't fall into this trap &mdash; teach your children to stick to their long term plan and ignore the daily market swings.</p> <h2>5. Don't Put All Your Eggs in One Basket</h2> <p>An important part of smart investing is diversifying. While diversification alone won't increase returns, it allows investors to reduce their risk. Diversification limits losses without sacrificing gains. It's the only way to do that. It's the &quot;free lunch&quot; of investing.</p> <p>By spreading investments over a variety of sectors and assets, the risk that any specific investment will fail is partially canceled by the other investments, thereby lowering the overall risk. Teach your adolescent children to diversify among asset classes, and furthermore, to diversify within each type of asset (such as different sectors, geographical regions, market capitalization, industries, etc.). Pivnick's book devotes a very readable chapter to diversification and provides useful examples of how to make it work for you.</p> <h2>6. Involve Your Children in Investment Decisions</h2> <p>Parents know that children tend to model their behavior after them, so it should be unsurprising that children's saving and investing behavior also follows that of their parents. Any chance you have to involve your children in day-to-day discussions about money are learning opportunities. And they are habit forming. If your children see you making sound, reasoned decisions about spending, they will start to think the same way about their spending habits.</p> <h2>7. Have Kids Write Goals and Savings Charts</h2> <p>It shouldn't come as a surprise that those who write down their goals are a third more likely to reach them. Plus, this can serve as a teaching moment for budgeting.</p> <p>As soon as your children receive birthday money, are old enough to do chores, or begin earning allowance, start a savings chart outlining their budget. People who write down their savings goals save, on average, over two times more than those that don't write a goal down.</p> <h2>8. Practice Learning by Doing</h2> <p>Anything you can do that actually involves your children in &quot;money&quot; tasks is a teaching opportunity and can instill good spending habits. Here are a few examples Rob provided:</p> <ul> <li>Have them help you figure out the restaurant bill and tip.</li> <li>Take them to the bank with their piggy bank to deposit funds in a savings account.</li> <li>Encourage them to take the lead on a refund or return with customer service.</li> <li>Allow them to negotiate a discount on the purchase of goods and services.</li> </ul> <h2>9. Give Limited Control and Let Them Make Mistakes</h2> <p>Once they are old enough, young adults should be given limited access to their money or bank accounts. Limited, in the context of parents-get-final-say-and-approve-silly-purchases, but still providing enough room to allow them to make those silly purchases. It only takes one super wasteful purchase to teach a lesson.</p> <h2>10. Teach Rules of Thumbs and Takeaways</h2> <p>Studies have shown that <a href="https://www.moodys.com/microsites/miic2010/presentationfiles/Fischer.pdf">rule-of-thumb money rules</a> affect financial behavior more than a thorough lesson on the topic. So, the rules of thumb must be included in your discussions. Here are some examples.</p> <ul> <li>After a lesson on compounding, provide an actionable takeaway, such as &quot;start early.&quot;</li> <li>Show the power of diversification with a rule of thumb: &quot;A single stock is riskier than a stock mutual fund.&quot;</li> </ul> <p>In Pivnick's book, you can find a great list of 14 takeaways to share with your children. After all, as parents, you want your kids to succeed &mdash; so set them up for that success by following these tips.</p> <p><em>What are you doing to teach your children about smart investing?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/damian-davila">Damian Davila</a> of <a href="http://www.wisebread.com/10-investing-lessons-you-must-teach-your-kids">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-6"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/buy-baby-bunting-but-dont-pay-full-price">Buy Baby Bunting... But don&#039;t pay full price!</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-tell-if-youre-on-track-for-retirement">How to Tell if You&#039;re on Track for Retirement</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-to-boost-your-odds-of-retiring-early">5 Ways to Boost Your Odds of Retiring Early</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/single-parent-try-these-10-tricks-for-entertaining-kids-on-a-budget">Single Parent? Try These 10 Tricks for Entertaining Kids on a Budget</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/11-ways-to-earn-extra-cash-from-thrift-stores">11 Ways to Earn Extra Cash From Thrift Stores</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Family Investment Lifestyle allowance investment money smart raising kids savings Fri, 20 Mar 2015 13:00:11 +0000 Damian Davila 1349215 at http://www.wisebread.com 5 Ways to Profit From Obama's Cuba Announcement http://www.wisebread.com/5-ways-to-profit-from-obamas-cuba-announcement <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-ways-to-profit-from-obamas-cuba-announcement" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/obama_000019001597.jpg" alt="Obama town hall meeting" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The historic executive order issued by President Obama heralds a new era of eased relations between the United States and Cuba. After over 50 years of iciness between the two neighbors, Obama's order establishes official diplomatic ties, reduces some travel and financial restrictions, and paves the way for greater humanitarian support, as well as trade in some areas, such as communications equipment.</p> <p>While the executive order still doesn't mean all Americans can travel to Cuba for tourism or bring back as many Cuban cigars as they'd like, it does pave the way for stronger economic and social ties between the two countries. Even better, there are a few simple ways you can profit from this historic accord. Read on to learn five ways the Cuba announcement can boost your pocketbook.</p> <h2>1. Consider Travel Stocks</h2> <p>At just 90 miles from the U.S., Cuba was an American tourism hotspot before the embargo, and remains a top travel destination for many Canadians and Europeans. That's why easing of restrictions to the island nation is likely a boon for travel companies. Cruise lines such as <a href="http://finance.yahoo.com/q?s=CCL&amp;type=2button&amp;fr=uh3_finance_web&amp;uhb=uhb2">Carnival&nbsp;Cruises</a>&nbsp;and <a href="http://finance.yahoo.com/q;_ylt=AkV8CgTowyRCTxgevM741TEnv7gF?uhb=uhb2&amp;fr=uh3_finance_vert_gs&amp;type=2button&amp;s=RCL">Royal Caribbean</a> have rallied on the news, seeing their stock prices boosted in anticipation of liberalized travel restrictions. Keep in mind, however, that this executive order is not a lifting of the Cuban embargo &mdash; that's up to Congress. American tourism to Cuba would be limited until such a time, so assess travel stocks accordingly.&nbsp;</p> <h2>2. Buy Into a Caribbean ETF or Fund</h2> <p>Today's historic announcement triggered a spike in the <a href="http://finance.yahoo.com/q;_ylc=X1MDMjE0MjQ3ODk0OARfcgMyBGZyA3VoM19maW5hbmNlX3dlYgRmcjIDc2EtZ3AEZ3ByaWQDBG5fZ3BzAzUEb3JpZ2luA2ZpbmFuY2UueWFob28uY29tBHBvcwMxBHBxc3RyAwRxdWVyeQNDVUJBLARzYWMDMQRzYW8DMQ&mdash;?p=http%3A%2F%2Ffinance.yahoo.com%2Fq%3Fs%3DCUBA%26ql%3D0&amp;type=2button&amp;fr=uh3_finance_web&amp;uhb=uh3_finance_vert&amp;s=CUBA">Hertzfeld Caribbean Basin Fund (CUBA)</a>, a fund which invests in companies throughout the Caribbean, including Cuba. Its price was up over 30% in intraday trading. Consider investing in ETFs or mutual funds with exposure to the island nation's businesses.</p> <h2>3. Look at Wire Transfer and Remittance Companies</h2> <p>The executive order increases the amount Americans may send in remittances to Cuba to $2000 per quarter, up from $500 today. That'll mean brisk business for remittance and wire transfer companies such as <a href="http://finance.yahoo.com/q?s=WU&amp;fr=uh3_finance_vert_gs&amp;type=2button&amp;uhb=uhb2">Western Union</a>. Its stock was up nearly 4% in intraday trading on the news.</p> <h2>4. Consider Credit Card Companies and Banks</h2> <p>The new rules will also be to the benefit of many financial services companies, since it'll now enable American debit and credit cards to be used on the island. That could be a boost to credit card companies and card processing services. Shares of <a href="http://finance.yahoo.com/q;_ylt=AwrBJR9565FUrSEA0UCTmYlQ?s=V">VISA</a> and <a href="http://finance.yahoo.com/q?s=AXP">American Express</a> also saw gains.</p> <h2>5. Consider Telecommunications</h2> <p>An authoritarian regime, Cuba has long been plagued by controls on its communications technologies which have been exacerbated by the embargo. The new executive order promises improved access to American telecommunications and Internet technology imports. That means stock of companies such as Verizon could see a boost. And when combined with further easing on travel to Cuba for import/export reasons, it means Americans involved in trade of communications products and devices may see improved business as a result.</p> <p>To be sure, there is no guarantee all of the executive order will be implemented easily, nor that any of these investments will bear significant returns. Already, some Republican lawmakers have expressed frustration with Obama's executive order, creating a potential Congressional showdown and hampering the likelihood of repealing the embargo. Still, this remains a historic opportunity to get in early on what may be one of the biggest investment stories of the next few years.</p> <p><em>Will you make changes to your portfolio to profit from normalization of relations between the United States and Cuba?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/janet-al-saad">Janet Al-Saad</a> of <a href="http://www.wisebread.com/5-ways-to-profit-from-obamas-cuba-announcement">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-7"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/retirement-not-just-for-people">Retirement: Not Just for People?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-build-wealth-in-a-depressed-economy">How to Build Wealth in a Depressed Economy</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/boost-your-retirement-savings-avoid-401k-fees">Boost Your Retirement Savings: Avoid 401(k) Fees</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/portfolio-ailing-take-a-peek-at-asian-markets">Portfolio Ailing? Take a Peek at Asian Markets.</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-ways-to-vet-an-ipo-before-you-buy">6 Ways to Vet an IPO Before You Buy</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Financial News Investment cuba obama Thu, 12 Mar 2015 07:40:16 +0000 Janet Al-Saad 1270232 at http://www.wisebread.com Everything You Need to Know About Peer-to-Peer Investing With Lending Club http://www.wisebread.com/everything-you-need-to-know-about-peer-to-peer-investing-with-lending-club <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/everything-you-need-to-know-about-peer-to-peer-investing-with-lending-club" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_laptop_000038703478.jpg" alt="Woman working on her laptop" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p><a href="http://www.lendingclub.com/">Lending Club</a> is a peer-to-peer lending firm, which matches private lenders with individual borrowers. You join, set up an account, search for matches based on your criteria, get more information if needed, and make a selection to invest your money or time. The process is relatively fast and convenient. There are risks, but also possibly great rewards. Here's what you need to know to get started <a target="_blank" href="http://track.linkoffers.net/a.aspx?foid=22948877&amp;fot=1194&amp;foc=1" rel="nofollow">investing with Lending Club</a>. (See also: <a href="http://www.wisebread.com/how-to-make-money-with-peer-to-peer-lending-service-prosper?ref=seealso">How to Make Money with Peer-to-Peer Lending with Prosper</a>)</p> <h2>1. Lenders Are Really Investors</h2> <p>Peer-to-peer lending firms provide a platform to match lenders with borrowers. The loans presented by Lending Club are funded by an outside bank and as a lender/investor, you purchase an investment associated with specific loans.</p> <p>So, as a &quot;lender&quot; you are not lending directly to borrowers; instead you are investing in Lending Club notes tied to specific loans, which you have chosen. Your earnings (or losses) are based on interest rates, loan terms, repayment, etc. relating to the loans in your portfolio.</p> <h2>2. The Minimum Amount for Investing Is $25</h2> <p>You can get started by investing $25 in one loan.</p> <p>Lending Club recommends that you invest in 100 loans for the purpose of creating a diversified loan portfolio. By investing $25 in 100 loans (for a total of $2,500), your investment risk is spread over multiple loans with various risk criteria. If borrowers default on some of your loans, you can still make money on the remaining loans.</p> <h2>3. You Can Open a Regular Account or an IRA</h2> <p>Your money with Lending Club can be held in a taxable investment account or a tax-advantaged retirement account. According to its website, you may be eligible to open and maintain a Traditional IRA, Roth IRA, Simple IRA, and/or SEP-IRA.</p> <p>There is a $100 annual account fee for an IRA. This charge is waived if your initial investment is $5,000 or more in Lending Club notes and you hold the investment for 12 months in your first year; or you maintain a minimum of $10,000 in Lending Club notes throughout the year.</p> <p>Other account types, such as trust, custodial/minors, and corporate, are also available.</p> <h2>3. There Are Two Ways to Choose Loans</h2> <p>Once you've set up an account and added funds, you are ready to choose loans. There are two main ways to select loans and create an investment portfolio.</p> <h3>Let Lending Club Choose Loans for You</h3> <p>Get Lending Club to select loans on your behalf. Go to the &quot;Invest&quot; section, where various options are presented. You may see &quot;Option 1&quot; with an interest rate of 8%; &quot;Option 2,&quot; 12%; and &quot;Option 3,&quot; 15%. These are the average interest rates associated with loans in the pre-designed portfolio. Note that your actual returns will vary because of defaults and fees.</p> <p>Choose among options based on your desired level of return and risk. Continue with the prompts to invest your money.</p> <h3>Select Loans Yourself to Build a Portfolio</h3> <p>Use tools provided by Lending Club to build a customized portfolio. Go to the &quot;Browse Notes&quot; tab. Apply filters to specify your criteria. For example, choose notes based on loan grades and sub-grades (ranging from A1 to G5), borrowers' credit scores, verified income levels, loan purposes, delinquencies, and more.</p> <p>Lending Club will provide results and allow you to get additional information for risk analysis. You may be able to learn about the borrower's employment and current debt-to-income ratio for example. Select and then invest in notes to add them to your portfolio.</p> <h2>4. Earn Money When and if Loans Are Repaid by Borrowers</h2> <p>As an investor, you'll receive monthly cash payments comprised of loan principal repayments and interest. You can then reinvest cash in another loan note, hold cash within your account, or transfer cash to your bank account for other purposes.</p> <p>Note that fees will be deducted from these monthly payouts, reducing overall returns.</p> <p>To tap cash quickly, trade your notes through a separate platform as long as these investments are held in a regular, taxable account. The value of these notes may vary, just as stock and bond prices fluctuate.</p> <h2>5. Fees Are 1% of Monthly Loan Payments Collected and Up</h2> <p>You'll pay fees on all money collected from borrowers. If the borrower pays on time (or within 15 days of the payment due date), 1% of the loan payment amount assigned to you will be deducted from your cash receipts. This fee is called a &quot;service charge.&quot;</p> <p>However, if the borrower is late and Lending Club must expend effort to collect payment, then you'll incur much higher fees. Investors pay a prorated portion relating to &quot;18% of the amount recovered if the loan is 16 or more days late and no litigation is involved,&quot; or &quot;30% of hourly attorneys' fees, plus costs, if litigation is involved,&quot; but no more than the original investment.</p> <h2>6. Lending Club Is Available in Several States</h2> <p>Currently, you can become a lender/investor at Lending Club only if you reside in one of these states: California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Kentucky, Louisiana, Maine, Minnesota, Mississippi, Montana, New Hampshire, Nevada, New York, Rhode Island, South Dakota, Utah, Vermont, Virginia, Washington, Wisconsin, West Virginia, and Wyoming.</p> <p>Further, there are age, citizenship, income, and net worth requirements. You must be 18 years of age and have a valid social security number, and, generally, have an annual income and net worth of $70,000 or more or have a net worth of $250,000 (not counting your primary residence and vehicles). Rules and restrictions vary by state.</p> <p>You may be able to purchase notes on the secondary market through FOLIOfn Investments, Inc. Note Trading Platform if your state does not allow you to invest directly in Lending Club Notes. However, there are additional costs and risks associated with this method.</p> <h2>7. Returns Are Not Guaranteed</h2> <p>Lending Club operates as an intermediary between lenders and borrowers. But just because the firm behaves in a bank-like manner doesn't mean the money you deposit is guaranteed to be safely returned to you with interest. Your investments are subject to risk as borrowers may default on loans, leaving you with nothing to show for your lending/investing efforts.</p> <p>To become an active member and lend to your peers in hopes of earning money, join Lending Club, fund your account, choose notes for your portfolio, and click to invest.</p> <p>According to its website, Lending Club has funded over $5 billion in consumer loans and paid over $494 million in interest since its inception in 2007. Historical returns for borrowers graded from A to C are 5% to 8.67%; however, historical performance does not predict future performance. Invest at your own risk.</p> <p>Create your account and start <a target="_blank" href="http://track.linkoffers.net/a.aspx?foid=22948877&amp;fot=1194&amp;foc=1" rel="nofollow">investing at Lending Club</a> today!</p> <p><em>Have you invested in Lending Club Notes? Did you make or lose money?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/julie-rains">Julie Rains</a> of <a href="http://www.wisebread.com/everything-you-need-to-know-about-peer-to-peer-investing-with-lending-club">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-8"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/peer-to-peer-lending-prosper-marketplace-or-lending-club">Peer to Peer Lending: Prosper Marketplace or Lending Club?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-dumb-401k-mistakes-smart-people-make">5 Dumb 401(k) Mistakes Smart People Make</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-cheap-easy-ways-to-invest-your-first-1000">4 Cheap, Easy Ways to Invest Your First $1000</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-7-most-successful-women-investors">The 7 Most Successful Women Investors</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-save-26000-in-5-years-or-less">How to Save $26,000 in 5 Years or Less</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment investing lending club peer to peer lending Fri, 06 Mar 2015 22:00:11 +0000 Julie Rains 1322637 at http://www.wisebread.com 5 Crucial Things You Should Know About Bonds http://www.wisebread.com/5-crucial-things-you-should-know-about-bonds <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-crucial-things-you-should-know-about-bonds" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/money_000039524102.jpg" alt="crucial things you need to know about bonds" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Be honest: How much do you actually know about bonds? If you're stammering for an answer, here's your chance to raise your bond IQ. For starters, bonds are an essential part of every investor's toolkit. They can provide stable returns to help offset volatility in other parts of your portfolio. (See also: <a href="http://www.wisebread.com/the-5-best-reasons-to-start-investing-in-bonds-now?ref=seealso">The 5 Best Reasons to Start Investing in Bonds Now</a>)</p> <p>Depending on how old you are, you may not own many bonds right now, but you likely will someday. It's important you at least understand the basics.</p> <h2>1. A Bond Is an &quot;I Owe You&quot;</h2> <p>Shakespeare famously wrote, &quot;Neither a borrower nor a lender be.&quot; Apparently, he knew a lot about personal finance (it's definitely best to go easy on the borrowing), but not so much about investing. When you buy bonds, that actually makes you a <em>lender</em>, and this form of lending can be a very good thing, especially as we get older.</p> <p>When a corporation or government (the two most common issuers of bonds) sells you a bond, it promises to repay the money at a specified future date (known as the bond's &quot;maturity date&quot;). Along the way, it also promises to pay you a fixed interest rate at regular intervals.</p> <p>Bond issuers use the tool to raise money for their operations. For example, when a local government needs to put in a new $3 million sewer system, it might sell $3 million worth of bonds to pay for the pipes. In essence, it's a way for them to borrow money, possibly for a longer time frame and at a lower interest rate than would be available to them through other means.</p> <p>You, as a buyer of the bonds, get a fairly safe investment with a known interest rate that is typically higher than you could get through <a href="http://www.wisebread.com/12-places-to-keep-your-money-safe-and-growing">other low-risk investments</a>, such as CDs.</p> <h2>2. Bonds Are Relatively Safe</h2> <p>If you read past Shakespeare's more famous phrase, you'll find this warning, &quot;&hellip;For loan oft loses both itself and friend.&quot;</p> <p>As safe as they may be, bonds do come with a risk of financial loss. The two main risks are credit risk and interest rate risk.</p> <h3>Credit Risk</h3> <p>A bond issuer's promise to repay is only as good as the issuer's financial strength. U.S. government bonds are safe as can be. If our country gets in financial trouble, it can just print more money. A start-up company's bonds? Not nearly as safe.</p> <p>If the issuer of the bond you bought goes out of business, you'll be out the money. That's what's meant by credit risk. You can manage this risk by buying highly rated bonds. Two companies rate the financial strength of bond issuers: Moody's, and Standard and Poor's. Bonds from the most credit-worthy organizations carry a AAA rating. Those with the worst ratings carry a C rating. The better the rating, the safer the bond. The downside is that the interest paid by the safest bonds is typically less than that paid by the lowest rated bonds.</p> <h3>Interest Rate Risk</h3> <p>The other type of risk associated with bonds is interest rate risk. When interest rates rise, the value of an already-issued bond falls. Think of it this way: If newly available bonds are offering a higher interest rate than your bond, why would someone buy yours? You'll have to offer it for less than you paid for it in order to attract a buyer. Of course, for buyers of individual bonds, this only matters if you plan to sell the bond before it matures. Otherwise, you'll still get back what you paid for your bond when it matures as well as the promised interest.</p> <h2>3. Bonds Exist to Lower the Risk of Your Portfolio</h2> <p>One of the most important principles in successful investing is <em>asset allocation</em>. This refers to how you divide your investment dollars across different asset classes, and the two most important asset classes are stocks and bonds. Stocks tend to be riskier than bonds, and over time they tend to generate better returns. When you're young, you have time to ride out the market's ups and downs, so an all- or mostly-stock portfolio is usually the way to go. As long as you can handle the ride, it will typically generate a better long-term return than a more conservative portfolio. (See also: <a href="http://www.wisebread.com/2-investing-concepts-everyone-should-know?ref=seealso">2 Investing Concepts Everyone Should Know</a>)</p> <p>As we get older, we can't afford to take as much risk, so it's best to reduce the amount of stocks in our portfolio, replacing them with lower-risk investments, such as bonds. Bonds are designed to lower the risk of your portfolio, smoothing out the ups and downs. The trade-off is they will also typically lower your overall returns.</p> <h2>4. The Easiest Way to Buy Bonds Is Through a Bond Fund</h2> <p>You can buy individual bonds, but it takes time to research the best ones and build an adequately diversified bond position in your portfolio. A much easier way is to buy bond mutual funds. Such funds are inherently diversified.</p> <p>All of the major fund companies offer bond funds, and you'll find many different types to choose from. There are corporate and government bonds; short-term, intermediate-term, and long-term bonds; domestic and foreign bonds, and more.</p> <p>You can also buy funds that contain a mix of stocks and bonds, such as target-date funds, which have become a common and popular option in 401(k) and other workplace plans. Such funds come with preset stock/bond allocations, based on how long an investor has until he or she plans to retire.</p> <p>They also automatically change that allocation over time, shifting away from stocks and toward bonds as the investor gets older. Target-date funds are far from perfect, but they do offer one of the easier ways to manage the use of bonds in your portfolio.</p> <h2>5. Boring Can Be Beautiful</h2> <p>Some people think of bonds as boring, and owning bonds certainly isn't as exciting as owning Tesla stock. But the older we get, the more the steady, low-risk income produced by the bonds become a thing of beauty.</p> <p><em>Do you own bonds? Why or why not?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/matt-bell">Matt Bell</a> of <a href="http://www.wisebread.com/5-crucial-things-you-should-know-about-bonds">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-9"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/your-401-k-is-not-an-investment">Your 401(k) is not an investment</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-easy-ways-to-start-green-investing">5 Easy Ways to Start Green Investing</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-invest-in-the-stock-market">Why invest in the stock market?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-turn-25-a-week-into-almost-7000-in-5-years">How to Turn $25 a Week Into Almost $7000 in 5 Years</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/2-investing-concepts-everyone-should-know">2 Investing Concepts Everyone Should Know</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment asset allocation bond fund bonds investing stocks Thu, 05 Mar 2015 14:00:07 +0000 Matt Bell 1317214 at http://www.wisebread.com 6 Benefits of Dumping a Losing Stock http://www.wisebread.com/6-benefits-of-dumping-a-losing-stock <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-benefits-of-dumping-a-losing-stock" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/stocks_000060834578.jpg" alt="Man deciding if he should dump losing stock" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Let's be honest &mdash; losing money in the stock market isn't fun. Plus, prolonged stock under-performance can undermine your investment strategy. But often, investors really don't know when to sell or when to hold and wait out a storm. Market volatility makes it necessary for every investor to have an exit strategy. Here's how to know when to dump an under-performing stock. (See also: <a href="http://www.wisebread.com/4-quick-ways-to-decide-if-a-company-is-worth-your-investment?ref=seealso">4 Quick Ways to Decide if a Company Is Worth Your Investment</a>)</p> <h2>1. It's Headed for Bubble Territory</h2> <p>Unusually high returns could mean a stock is headed for bubble territory. True, some stocks (Apple, anyone?) are just perennial winners. Typically, however, the party doesn't last forever, and what goes up must eventually come down. At the end of the year, consider selling off shares of exceptionally well-performing stocks to rebalance your portfolio's asset allocation and return it to its original allotted positions.</p> <h2>2. The Stock Is Overvalued</h2> <p>Before you dump a stock, check its price/earnings ratio (P/E ratio). The P/E ratio will reveal investor confidence in a company's stock and what they are willing to pay relative to the company's actual earnings. To <a href="http://www.investopedia.com/terms/p/price-earningsratio.asp">calculate the P/E ratio</a> &mdash; divide the company's stock price by its earnings per share. The standard P/E ratio is anywhere from 15-30. Over 30 is an indicator the company might be overvalued. The P/E ratio can be found on websites like <a href="http://www.morningstar.com/">Morningstar</a> and <a href="http://www.marketwatch.com/">Marketwatch</a>.</p> <p>Another way to value a stock is by calculating the company's <a href="http://www.investopedia.com/terms/o/ocfratio.asp">cash flow ratio</a>. To do this, simply divide the cash flow from operations by its current liabilities. The cash flow should be consistent with that of similar companies. If it's higher, it's probably overvalued. Some say this is a better performance measure. This information usually can also be found on the aforementioned financial websites.</p> <h2>3. The Stock Underperforms for Consecutive Years</h2> <p>If a stock experiences prolonged losses for a number of consecutive years, it may be that Wall Street knows something that you don't. It might be time to sell.</p> <h2>4. A New Fund Manager</h2> <p>Mutual funds sometimes hire new fund managers may who may have a different investment philosophy than the previous fund manager. At the end of every year, take a look a the assets within your funds. If you notice shifts to its asset allocation &mdash; such as being weighed more heavily to large cap stocks than before &mdash; this could indicate a change to the fund's strategy. If you're uncomfortable with any changes because they are out of alignment with your investment goals, dump the fund.</p> <h2>5. Capital Losses Eclipse Gains</h2> <p>When your capital losses exceed your capital gains, it may make sense to dump an under-performing stock. You can deduct up to $3,000 a year against your income and carry over up to $3,000 into following years. But do wait to make a decision until the end of the year. And be mindful of the <a href="http://www.investopedia.com/terms/w/washsalerule.asp">&quot;watch/sell&quot; rule</a> that prohibits investors from purchasing the stock or similar investments 30 days before or after the sale.</p> <h2>6. Volatility Is Keeping You Up at Night</h2> <p>Some market conditions are almost unbearable to withstand. Sharp fluctuations are not worth the gamble if they affect your health, or if your investment goals are short-term &mdash; such as for those relying on income from their investments.</p> <p><em>How do you decide whether to sell a stock or fund?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/qiana-chavaia">Qiana Chavaia</a> of <a href="http://www.wisebread.com/6-benefits-of-dumping-a-losing-stock">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-10"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-dumb-401k-mistakes-smart-people-make">5 Dumb 401(k) Mistakes Smart People Make</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-cheap-easy-ways-to-invest-your-first-1000">4 Cheap, Easy Ways to Invest Your First $1000</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-7-most-successful-women-investors">The 7 Most Successful Women Investors</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-save-26000-in-5-years-or-less">How to Save $26,000 in 5 Years or Less</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-top-5-etfs-you-should-buy-now">The Top 5 ETFs You Should Buy Now</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment investing losing stock stocks and bonds Wed, 04 Mar 2015 14:00:08 +0000 Qiana Chavaia 1316910 at http://www.wisebread.com 5 Reasons Social Media is Still a Smart Investment http://www.wisebread.com/5-reasons-social-media-is-still-a-smart-investment <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-reasons-social-media-is-still-a-smart-investment" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/social_media_000040645286.jpg" alt="People being active on social media for a smart investment" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Welcome to the heyday of the social media stock. Not only is the value of shares in companies like LinkedIn and Facebook soaring, but experts also say these companies have got lasting power and major growth potential, making them good long-term investments. Sure, these companies have seen their fair share of challenges. Last year the <a href="http://www.federalreserve.gov/monetarypolicy/files/20140715_mprfullreport.pdf">Federal Reserve</a> called their valuations &quot;stretched&quot; and <a href="http://www.slate.com/blogs/moneybox/2014/05/06/twitter_s_stock_crashed_after_its_post_ipo_lockup_period_expired.html">Twitter's stock value</a> slumped to an all-time low. But these companies have lived and learned from their fumbles. Advocates say they've ironed out many of the kinks, making them better poised for a bright future than ever. Here are five reasons to favorite social media in your portfolio.</p> <h2>1. Social Media Is Overtaking Search</h2> <p>Businesses are always looking for better ways to promote themselves and connect with customers, and <a href="http://www.socialmediaexaminer.com/SocialMediaMarketingIndustryReport2014.pdf">social media is overtaking search</a> as one of the most sure-fire, influential ways of doing so. Over 90% of marketers now say that social media is important to their business. That's a strong indicator of social media's import and staying power, both in the business world and on the market.</p> <h2>2. New Revenue Streams Are Emerging</h2> <p>As more and more people take to using social media, the companies that own these networking sites are devising new ways to generate revenue. Twitter, for example, just created a brand new revenue stream by purchasing Niche, a sponsored content generator that connects social media stars with brand names. Facebook is making massive investments in satellite and aerospace technology, which advocates say could prove to be incredibly valuable down the road.</p> <h2>3. Big Data Is an Untapped Cash Cow</h2> <p>Social media companies own massive amounts of raw data that could reveal valuable information about things like how people make purchase decisions or what goods and services they may require in the future. Indeed, Facebook ingests approximately 500 times more data each day than the New York Stock Exchange does. &quot;Facebook is sitting on <a href="http://moneymorning.com/2014/04/10/the-two-best-social-media-companies-to-invest-in-now/">a hidden goldmine</a> if it can figure out a way to monetize the user data of its over one billion user base,&quot; tech sector specialist Michael A. Robinson told Money Morning.</p> <h2>4. The Growth Potential Is Huge</h2> <p>For every four minutes spent online, one is spent using social media. And, particularly with mobile device usage on the rise, experts say there's lots of room for growth. Bruno Del Ama, CEO of Global X Funds, says social media is one of the fastest-growing segments in global capital markets. In fact, there are very few companies growing as fast as Facebook, Twitter, LinkedIn, and Yelp. &quot;I think one of the most interesting things about these companies that's misunderstood is these are actually very defensible business models,&quot; Del Ama told CNBC. &quot;It's very, very difficult to go after, say, a Facebook or a Twitter. Once they build these networks, it's very difficult to displace them once you have&hellip; billions, in the case of Facebook, of users in your network.&quot;</p> <h2>5. Mark Cuban Says They're Solid</h2> <p><a href="http://www.cnbc.com/id/101867483">Social media stocks</a> are not in a bubble, billionaire investor Mark Cuban told CNBC. &quot;It's not 1999 all over again by a long shot,&quot; said the Dallas Mavericks owner, who made his fortune as an Internet entrepreneur. Yes, social media companies have large valuations. But unlike the '90s, they have good business models and strong revenue growth, too. That makes them solid long-term investments.</p> <p><em>Are you investing in social media stocks? Why or why not?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/brittany-lyte">Brittany Lyte</a> of <a href="http://www.wisebread.com/5-reasons-social-media-is-still-a-smart-investment">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-11"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-avoid-gambling-away-your-investments">How To Avoid Gambling Away Your Investments</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/its-time-to-purchase-like-its-1999">It&#039;s Time to Purchase Like It&#039;s 1999</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-creative-ways-to-invest-during-a-weak-market">5 Creative Ways to Invest During a Weak Market</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/survive-the-bear-market-10-steps-to-ride-the-downturn">Survive The Bear Market: 10 Steps To Ride The Downturn</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/who-cares-about-where-the-stock-market-is-headed">Who Cares About Where The Stock Market Is Headed?</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment investing social media stock market Mon, 02 Mar 2015 22:00:10 +0000 Brittany Lyte 1314958 at http://www.wisebread.com 5 Dumb 401(k) Mistakes Smart People Make http://www.wisebread.com/5-dumb-401k-mistakes-smart-people-make <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-dumb-401k-mistakes-smart-people-make" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/retirement_plan_000021099854.jpg" alt="Retirement planning" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>401(k)s are very important to Americans' retirements &mdash; so important, in fact, that they represent nearly 18% of the $24.0 trillion in <a href="http://www.ici.org/policy/retirement/plan/401k/faqs_401k">U.S. retirement assets</a>.</p> <p>But those trillions of dollars aren't reaching their maximum earning potential due to dumb mistakes made by 401(k) owners. (See also: <a href="http://www.wisebread.com/4-ways-to-boost-your-401k-returns?ref=seealso">4 Ways to Boost Your 401(k) Returns</a>)</p> <p>Here are five pitfalls that you should avoid in order to maximize your 401(k) nest egg.</p> <h2>1. Not Exploring Investment Options</h2> <p>401(k) participants spend more time researching options for a new car or vacations than researching their 401(k) investment choices. According to a survey, while 55% of people spend more than five hours conducting research before buying a car, only 11% of those same people spend that much time before <a href="http://aboutschwab.com/images/uploads/inline/deck_2014-Schwab-401(k)-Participant-Survey.pdf">making an investment choice</a> for their 401(k).</p> <p>Part of the problem may be that people don't understand their 401(k) investment options. About half of those people surveyed found 401(k) investment materials more confusing than health care benefits materials. Instead of doing it on your own, consider that over half of retirement plans have <a href="http://www.shrm.org/research/surveyfindings/articles/documents/13-0245%202013_empbenefits_fnl.pdf">individual investment advice</a> offered on a one-on-one basis.</p> <h2>2. Borrowing From a 401(k)</h2> <p>An average of 13,000 people <a href="http://money.usnews.com/money/retirement/articles/2014/06/09/the-risks-of-taking-a-401-k-loan">take a loan each month</a> out of their 401(k)s for a median of about $4,600. Borrowing from your 401(k) is bad idea for several reasons:</p> <ul> <li>Loaned funds miss out on earnings potential, often for many years;<br /> &nbsp;</li> <li>If you lose your job, your full loan balance becomes due;<br /> &nbsp;</li> <li>By failing to make quarterly payments or paying back the full balance within five years, the <a href="http://www.irs.gov/Retirement-Plans/Retirement-Plans-FAQs-regarding-Loans#4">loan becomes taxable income</a>;<br /> &nbsp;</li> <li>401(k) participants under age 59&nbsp;<span style="color: rgb(51, 51, 51); font-family: Arial, Helvetica, sans-serif; font-size: 13px; line-height: 22.1000003814697px;">&frac12;</span>&nbsp;that fail to pay their 401(k) loans are subject to an additional 10% early distribution tax; and<br /> &nbsp;</li> <li>Once a remaining 401(k) loan balance becomes taxable income, that money can't be rolled over into any eligible retirement plan.</li> </ul> <p>There are very few acceptable instances to borrow from a 401(k), and you should leave your retirement account as a last resort option for financing. Taking loans from your 401(k) can quickly turn into a bad habit. In a one-year study of 180,000&nbsp;<a href="http://www.nytimes.com/2013/08/17/your-money/one-dip-into-401-k-savings-often-leads-to-another.html?pagewanted=all&amp;_r=0">borrowers from 401(k) plans</a>, 25% of them took out a third or fourth loan, and 20% of them took out five or more loans. (See also: <a href="http://www.wisebread.com/this-is-when-you-should-borrow-from-your-retirement-account?ref=seealso">This Is When You Should Borrow From Your Retirement Account</a>)</p> <h2>3. Taking Cashouts When Switching Jobs</h2> <p>When you leave your job, you typically have to choose between taking a cash-out or rolling your 401(k) into a qualifying individual retirement account (IRA). While the first option is taxable, the second one is not.</p> <p>Taking cashouts when switching jobs is a dumb mistake for three reasons:</p> <ul> <li> <p>If you're under age 59 &frac12;, you're liable for both income tax and a 10% early distribution tax.</p> </li> <li> <p>You may not get as much as you think. Some 401(k) plans have a vesting period for employer contributions. Pay special attention if your plan has a cliff-vesting schedule for employer contributions, which means that you only become eligible for employer contributions after a specified date.</p> </li> <li> <p>There is a limit to how much you can contribute to your 401(k) every year. In 2015, the <a href="http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-401k-and-Profit-Sharing-Plan-Contribution-Limits">maximum contribution limit</a> to a 401(k) is $18,000. This means that once you cashout monies, they may never make it back to your nest egg, without forfeiting part of your future contributions.</p> </li> </ul> <p>If you already took a cashout, still have the money, and are within 60 days from the cashout date, you still have time to roll the money over to an IRA. Don't waste time and avoid taxes!</p> <h2>4. Not Taking Advantage of the Retirement Saver's Credit</h2> <p>This is one time that you want to call up the tax man.</p> <p>Even though you may feel that you're not making much money, you're still very diligently contributing to your 401(k) or other qualifying retirement plan. Uncle Sam would like to reward your hard work by providing you a tax break through the <a href="http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/Retirement-Topics-Retirement-Savings-Contributions-Credit-(Saver&rsquo;s-Credit)">retirement saver's credit</a>.</p> <p>In 2015, the retirement saver's credit provides a tax credit based on your adjusted gross income (AGI). For example, a married couple filing jointly receives a tax credit that is:</p> <ul> <li>50% of 401(k) contributions when AGI is under $36,500;</li> <li>20% of 401(k) contributions when AGI is between $36,501 and $39,500; and</li> <li>10% of 401(k) contributions when AGI is between $36,501 and $61,000.</li> </ul> <p>Married couples filing jointly can receive up to $4,000 ($2,000 for all other filers) in retirement saver's credit. This is one of the many reasons why it is important to start saving for retirement as early as possible. Depending on your AGI, you can take advantage of tax breaks such as this. Plus, you can always defer taxes until retirement, when you're more likely to be in a lower tax bracket.</p> <p>Less taxes, more retirement savings; now that's a great money resolution for any year. (See also: <a href="http://www.wisebread.com/4-money-resolutions-you-should-skip-this-year">4 Money Resolutions You Should Skip This Year</a>)</p> <h2>5. Self-Employed: Not Having a Solo 401(k)</h2> <p>Independent contractors, freelancers, and small business owners may think that they're not eligible to open a 401(k). They'd be wrong. They <em>can</em> open a <a href="http://www.irs.gov/Retirement-Plans/One-Participant-401(k)-Plans">solo 401(k)</a>, also known as an one-participant k or uni-k.</p> <p>Solo 401(k) plans enable the self-employed to save up larger sums for retirement. If you're a sole proprietor and have no employees, you can contribute to your solo 401(k) as employer and employee.</p> <p>For example, let's imagine that you have an S-corporation and earned $40,000 in 2014. You can contribute the maximum $17,500 allowed to your solo 401(k), and your S-corporation can contribute an additional 25% to the plan (an additional $10,000). The total contributions to your nest egg for 2014 would be $27,500.</p> <p>This example shows how a solo 401(k) is a powerful way to catch up in the race for retirement. The IRS allows total contributions to a solo 401(k), not counting catch-up contributions for those age 50 and over, of up to $52,000 for 2014, and $53,000 for 2015. If your spouse earns income from your business, then you can <em>double</em> those contribution limits.</p> <p><em>What are you doing to boost your 401(k) plan? Please share in comments.</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/damian-davila">Damian Davila</a> of <a href="http://www.wisebread.com/5-dumb-401k-mistakes-smart-people-make">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-12"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/you-may-be-putting-your-retirement-money-in-the-wrong-place">You May Be Putting Your Retirement Money in the Wrong Place</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-silly-reasons-people-dont-invest-but-should">9 Silly Reasons People Don&#039;t Invest (But Should)</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-dumb-investments-smart-people-make">5 Dumb Investments Smart People Make</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-investing-sucks-and-why-you-should-do-it-anyway">7 Ways Investing Sucks (and Why You Should Do It Anyway)</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/this-one-thing-will-get-you-to-1-million-tax-free">This One Thing Will Get You to $1 Million (Tax-Free!)</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment 401(k) investing retirement saving Thu, 26 Feb 2015 10:00:06 +0000 Damian Davila 1309065 at http://www.wisebread.com 10 Reasons Why Apple Is Still on a Tear http://www.wisebread.com/10-reasons-why-apple-is-still-on-a-tear <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/10-reasons-why-apple-is-still-on-a-tear" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/apple store_0.jpg" alt="apple store" title="apple store" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Remember when people were wondering if Apple had lost its mojo? Following the loss of Steve Jobs, the maker of the Mac, iPhone, and iPad went a bit adrift, and investors were left wondering if the company would ever return to form.</p> <p>Now Apple is hotter than ever, as evidenced by its most recent quarterly earnings report, which showed the best results of any corporation in history. Apple recorded a profit of $18 billion in its most recent quarter, with revenue of $74.6 billion. That's a gain of about $1 per share over the same quarter the year prior. Shares of Apple [<a href="http://www.nasdaq.com/symbol/aapl">NASDAQ: AAPL</a>] have risen about 8% in the last month.</p> <p>Apple is back, and there are plenty of reasons to believe it will remain one of the world's best-performing companies through 2015 and beyond. Here are 10 of the main drivers of Apple's success now and down the road.</p> <h2>1. The Brand</h2> <p>Last year, Apple was named the&nbsp;<a href="http://fortune.com/worlds-most-admired-companies/">world's most admired company</a> by Fortune magazine. There's little reason to think it won't be high on the list again this year. Interbrand's rankings of&nbsp;best global brands also slotted Apple at number one, valuing the brand at $118.9 billion, a 20% rise over 2013. When you have a brand as well-known and popular as Apple, your products practically sell themselves.</p> <h2>2. The iPhone</h2> <p>Apple sold a staggering 75.5 million iPhones in the last quarter of 2014, surpassing even the most optimistic estimates of many analysts. The iPhone now has a 15% global share and is the best-selling phone in China.</p> <h2>3. The iWatch</h2> <p>Smart watches aren't new, but consumers have been waiting patiently for Apple's entrance into the category. The iWatch was first revealed&nbsp;last September to considerable buzz and is expected to go on sale this spring. It has an estimated price tag of more than $300, making it another high-margin product that could revolutionize a category and immediately be a formidable competitor to FitBit, Jawbone, and Nike Fuelband.</p> <h2>4. The Mac</h2> <p>The company reported 5.5 million sales of its computers in the last quarter, representing a 14% year-over-year increase. The company is not as dependent on Mac sales as it once was, and the <a href="http://www.netmarketshare.com/">Mac operating system</a>&nbsp;makes up about 5% of the market compared to more than 90% for Windows. But Mac computers are high-margin products and very helpful to Apple's financials. Expect good results from a new line of MacBook Air laptops this year.</p> <h2>5. The iPad</h2> <p>Sales of the Apple tablet slid by about 15% in 2014, and analyst projections for this year aren't great. But the iPad was still the&nbsp;<a href="http://www.businesswire.com/news/home/20150202005241/en/Worldwide-Tablet-Shipments-Experience-Year-Over-Year-Decline-Fourth#.VNkpnLDF-ey">top tablet on the market</a>&nbsp;in 2014, comprising a 27.6% market share. The decline in iPad sales was largely due to a decline in tablet sales overall, and competitors Samsung and ASUS saw their sales drop even more than Apple's. It's possible that the iPad will comprise a smaller chunk of Apple's revenue moving forward, or the company could blow consumers away with its next version. Don't count out the iPad's role in Apple's well-being just yet.</p> <h2>6. The Apple Television</h2> <p>There have been rumors of this product for a while, and it's anyone's guess as to when (or even if) it will be produced. But Apple's success with the retina display on computers and tablets has many consumers salivating over a potential high-definition, Internet-enabled television from Apple. Given Apple's success in creating great consumer products for computing and music, one can expect an Apple television set to be high-quality, easy to use, and with a healthy margin. Even the speculation about an Apple television is probably helping the company's stock price a few points.</p> <h2>7. The Beats Music</h2> <p>No one is entirely sure what Apple plans to do with its billion dollar acquisition of Beats Electronics, but the company has been praised for recognizing the potential of a streaming music service. Sales of media from Apple's iTunes have been sagging, but Beats offers the avenue for Apple to compete with the likes of Spotify and Pandora, which offer streaming music for a monthly fee. And Apple is so well capitalized that we should not be surprised if Beats streaming service is&nbsp;<a href="http://9to5mac.com/2015/02/04/apple-beats-cheaper-android-ios/">priced better than competitors</a>, at least initially. Beats also has a high-end headphone business that should bring in additional revenue.</p> <h2>8. The Mountain of Cash</h2> <p>Apple has nearly $180 billion in cash or bonds, which is larger than the market capitalization of some big companies, including Amazon and Disney. Analysts and investors love to guess what Apple plans to do with all its money, but anything the company does will probably be helpful to investors. It could spend it on research and development, which would benefit the company down the line. It could perform a share buyback or distribute a nice dividend. Or it could make some strategic acquisitions.</p> <h2>9. The International Growth</h2> <p>The United States makes up less than 5% of the world's population, so it makes sense to look outside our borders to find customers. Apple said that 65% of its revenue in the most recent quarter came from&nbsp;<a href="http://techcrunch.com/2015/01/27/apple-q1-sales-in-china-pass-16b-up-157-on-q4-70-on-a-year-ago/">international sales</a>. That's up from 60% in the fourth financial quarter last year and 59% the quarter before that. Revenues were up 70% over the year in China, 20% in Europe, and 8% in Japan, according to TechCrunch.</p> <h2>10. The Mess at Amazon</h2> <p>One of Apple's chief competitors is Amazon, the online retailer that has also made entries into the smartphone and tablet space. By most accounts, Amazon's launch of the Fire Phone was a disaster, and the company reported a&nbsp;<a href="http://www.cnet.com/news/amazon-takes-170m-charge-on-fire-phone/">$170 million charge</a>&nbsp;in the third quarter due to its lack of sales. Amazon also saw its tablet sales drop 66% in 2014. Amazon's products aren't bad, but they haven't been selling, and that's good news for Apple.</p> <p><em>Do you own Apple stock?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/tim-lemke">Tim Lemke</a> of <a href="http://www.wisebread.com/10-reasons-why-apple-is-still-on-a-tear">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-13"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/get-free-media-software-for-your-windows-pc">Get Free Media Software for Your Windows PC</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-easy-ways-to-start-green-investing">5 Easy Ways to Start Green Investing</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-to-boost-your-odds-of-retiring-early">5 Ways to Boost Your Odds of Retiring Early</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-ways-etfs-can-put-more-money-in-your-pocket-than-mutual-funds">8 Ways ETFs Can Put More Money in Your Pocket Than Mutual Funds</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-how-rich-youd-be-if-you-stopped-drinking-expensive-coffee">Here&#039;s How Rich You&#039;d Be if You Stopped Drinking Expensive Coffee</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment apple computers ipads iphones Tue, 24 Feb 2015 14:00:10 +0000 Tim Lemke 1302502 at http://www.wisebread.com 4 Great Investments That Sounded Really Stupid in the 2000s http://www.wisebread.com/4-great-investments-that-sounded-really-stupid-in-the-2000s <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/4-great-investments-that-sounded-really-stupid-in-the-2000s" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/yelp lunchbox 2.jpg" alt="yelp lunchbox" title="yelp lunchbox" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Ridicule and high return are often positively correlated.</p> <p>In the 1970's, there was the pet rock craze, which reportedly made $15 million in its first six months. Now fast forward to 1989 &mdash; would you have invested in the penny stock of a homebrew computer maker? Well, a <a href="http://articles.latimes.com/1999/dec/28/business/fi-48388">$5,000 investment in Dell</a> that year would have made you $4.5 million by the end of 1999.</p> <p>History tends to repeat itself. Here are four investments that sounded really stupid in the 2000s, yet ended in big paydays for their early investors.</p> <h2>1. Santa Mail</h2> <p>If you're a fan of the TV show <em>Shark Tank</em>, you know that it takes a bold pitch with big numbers to impress the sharks.</p> <p>Well, how's this for a pitch? &quot;New York City's Operation Santa responds to about <a href="http://about.usps.com/news/electronic-press-kits/holidaynews/2014/holiday_santa.htm">500,000 letters to Santa</a> every year for free. However, every year millions of American children write to Santa hoping to get a reply. My plan is to capture some of that market and charge parents about $10 for a personalized letter from the big guy himself! Are you ready to invest, sharks?&quot;</p> <p>This investment proposition sounded really stupid back in 2001 and it probably still does today. However, entrepreneur Byron Reese stuck to his guns and sold <a href="http://www.wattpad.com/51055043-we-all-need-heroes-santa-mail">10,000 letters</a> in his first year of operation. His company Santa Mail has delivered over <a href="http://www.santamail.org/aboutus/">350,000 personalized Christmas letters</a> since then. With over $3.48 million in revenue over the years, he's surely having a Merry Christmas now!</p> <h2>2. Lucky Break Wishbone</h2> <p>After Christmas, Thanksgiving may be the second most important holiday in the U.S.</p> <p>For those of us who love to enjoy a turkey on that day, we often have to fight for a chance to take a crack at the lone wishbone. In 1999, Ken Ahroni thought there had to a better way than fighting over the dinner table for choice turkey.</p> <p>He devised a plastic version of the turkey wishbone and started selling them in 2004. His goal was to give folks a chance to make a wish with every single family member and friend &mdash; not only on Thanksgiving, but also the rest of the year.</p> <p>His silly idea paid off. According to Investopedia.com, within two years his <a href="http://www.luckybreakwishbone.com/ourstory.php">Lucky Break Wishbone Corporation</a> was generating nearly $1 million in sales. You can find his product in several retailers, including Whole Foods, Fred Meyer, and Urban Outfitters.</p> <p>Now, that's a lucky break!</p> <h2>3. Yelp</h2> <p>I bet you that you have already used or will use Yelp this week.</p> <p>While Yelp is now a household name, it wasn't always so. Back in 2004, Jeremy Stoppelman and Russell Simmons were riding high on their successful stint at digital wallet company PayPal. Jeremy and Russell decided to leave Paypal and start their own &quot;high tech&quot; company.</p> <p>What was this revolutionary idea that made them leave their cozy job? An email-based referral network dubbed Yelp. On top of its silly name, Yelp's original platform was so complicated that it <a href="http://www.inc.com/magazine/20100201/youve-been-yelped_pagen_3.html">didn't attract investors</a> beyond the co-founders' friends and family.</p> <p>However, Jeremy and Russell didn't give up and re-focused their company around a review feature. The rest is history. Yelp's user base grew from a total of 12,000 in 2005 to approximately <a href="http://www.yelp.com/about">139 million monthly visitors</a> in 2014. Despite its growing revenue throughout the years, there were still plenty of skeptics when Yelp went public in March 2012 at $15 a share. A $1,000 investment in Yelp then would be worth about $3600 now.</p> <h2>4. Slanket</h2> <p>When you think of sleeved blankets, you probably think of the Snuggie.</p> <p>However, that's not the original wearable blanket. That title belongs to the Slanket. Created in 1997 by Gary Clegg, the Slanket was first used as a way to stay warm while flipping TV channels late at night in a cold dorm room. This investment idea sounded so stupid that Clegg waited until 2005 before fully committing to it.</p> <p>His first run of <a href="https://www.americanexpress.com/us/small-business/openforum/articles/the-story-behind-the-original-snuggie/">1,200 units sold out</a> in seven weeks &mdash; a sign that he had to move really, really fast to keep the market. He enjoyed a successful run of QVC sales and was finally ready to introduce a cheaper version, called the Snuzzle, to big box retailers. Instead, in the fall of 2008 the Snuggie aggressively entered the market and became the new king of sleeved blankets. As of 2013, Snuggie has pulled in more than <a href="http://www.buzzfeed.com/sapna/the-house-that-snuggie-built#.cyMmel8ZXW">$500 million in sales</a>.</p> <p>While the Slanket is still selling, it has been estimated that the Snuggie has outsold the Slanket 20-to-1. The Snuggie has been such a hit, that there's even a <a href="http://www.amazon.com/gp/product/B002L02ALY/ref=as_li_tl?ie=UTF8&amp;camp=1789&amp;creative=390957&amp;creativeASIN=B002L02ALY&amp;linkCode=as2&amp;tag=wisbre03-20&amp;linkId=FGG4J4IYSP4T5WVP">version for pets</a>!</p> <p>If you snooze, you lose!</p> <p>Ghandi said it best; &quot;First they ignore you, then they laugh at you, then they hate you, then they fight you, then you win.&quot; These four ventures are proof that dedication to your ideas, no matter how much they may be ridiculed, pays off in the end.</p> <p><em>What &quot;crazy&quot; investment from the 2000's do you wish you had jumped on?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/damian-davila">Damian Davila</a> of <a href="http://www.wisebread.com/4-great-investments-that-sounded-really-stupid-in-the-2000s">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-14"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/12-smart-ways-to-turn-500-into-a-better-future">12 Smart Ways to Turn $500 Into a Better Future</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-dumb-401k-mistakes-smart-people-make">5 Dumb 401(k) Mistakes Smart People Make</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-cheap-easy-ways-to-invest-your-first-1000">4 Cheap, Easy Ways to Invest Your First $1000</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-7-most-successful-women-investors">The 7 Most Successful Women Investors</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-save-26000-in-5-years-or-less">How to Save $26,000 in 5 Years or Less</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment investing luck windfall Mon, 23 Feb 2015 14:00:07 +0000 Damian Davila 1302125 at http://www.wisebread.com The 7 Most Successful Women Investors http://www.wisebread.com/the-7-most-successful-women-investors <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-7-most-successful-women-investors" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/businesswoman-investor-stocks-computers-Dollarphotoclub_15934300.jpg" alt="businesswoman stocks" title="businesswoman stocks" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>When you hear &quot;successful investors,&quot; who comes to mind? Maybe Warren Buffett, Carl Icahn, or Ron Perelman? Often, there isn't a single woman in the bunch. This article means to change that. (See also:<a href="http://www.wisebread.com/5-investors-with-better-returns-than-warren-buffett?ref=seealso"> 5 Investors With Better Returns Than Warren Buffett</a>)</p> <p>Below are seven women who have bucked the stereotype and built enormously successful investment careers despite the &quot;old boys&quot; club of finance.</p> <h2>1. Geraldine Weiss</h2> <p>Though she was a top finance student at the University of California, not a single investment firm considered Weiss for a role beyond being a secretary. She refused to be deterred from having her say, so she started <a href="http://www.iqtrends.com/index.htm">Investment Quality Trends (IQT)</a>, a finance newsletter. When she started receiving hate mail from people who said a woman wasn't capable of giving investment advice, she began to sign her newsletter &quot;G. Weiss&quot; and soldiered on. That was 50 years ago. Today she remains one of the most successful and prolific investors, analysts, writers, lecturers, and TV personalities in the world of finance.</p> <h2>2. Muriel Siebert</h2> <p>In 1967, the NYSE was a world where no woman-owned brokerage firm had ever gone before. Siebert changed that. Despite blatant and constant attempts to keep her brokerage firm, <a href="https://www.siebertnet.com/">Muriel Siebert &amp; Co.</a>, from registering with the NYSE, she refused to take &quot;no&quot; for an answer. Unfortunately, her company remains the only woman-owned national brokerage firm on the NYSE today. Siebert passed away in 2013 leaving a rich legacy in finance and politics that continues to inspire and encourage women today.</p> <h2>3. Lubna S. Olayan</h2> <p>Saudi Arabia is known for the stifling limitations it places on women in the social, political, and business realms. Olayan didn't let that stop her. After building an illustrious career in finance rising through the ranks of <a href="http://www.olayan.com/">Olayan Finance Company</a>, a conglomerate of 40 manufacturing firms, she is now the CEO. Despite her heritage, she often faces intense criticism. She does so with grace and strength, and refuses to let the ignorance and oppression of the Saudi government limit her. She serves as a pillar of courage to women in the Middle East and all over the world.</p> <h2>4. Deborah A. Farrington</h2> <p><a href="http://www.starvestpartners.com/">StarVest Partners</a> is a behemoth in the world of venture capital, where Farrington is a co-founder. She's also served as President and CEO of Victory Ventures, LLC; Chairman of Staffing Resources, Inc; and continues to hold numerous director and committee roles at technology companies, Smith College, and Harvard (her alma maters), and a leading international microfinance organization.</p> <h2>5. Marianne Abib-Pech</h2> <p>After a successful business career that included stints at Arthur Andersen, GE, and Shell International Petroleum, Abib-Pech struck out on her own. She boldly moved to Hong Kong to write an investment book and founded <a href="http://leadthefuture.biz/">Lead the Future (LTF)</a>, a leadership consulting firm, financial advising, and thought leadership platform rolled into one. High-profile oil and gas companies are among her diverse clients.</p> <h2>6. Kathy Xu</h2> <p>Warren Buffett is known for only investing in concepts he can understand. He doesn't jump on fads and isn't persuaded by paper-thin trends. Kathy Xu, arguably the most successful investor in China (male or female), is known for her prudence and shrewd decisions. Once she makes an investment, she's in it for the long haul. Xu started her Shanghai-based private equity firm, <a href="http://capitaltoday.com/eng/index.html">Capital Today</a>, 10 years ago and her track record is impeccable. Her latest jewel? The IPO of JD, China's second largest e-retailer.</p> <h2>7. Nehal Chopra</h2> <p>Since the last recession cycle started in 2007, hedge funds and their managers have been hammered by less-than-appealing returns. Ratan Capital Management, the firm founded by Chopra, has bucked that trend to the envy of every other hedge fund manager, often returning 20%+. At 35, she oversees $750 million in assets.</p> <p>What truly impresses me about these women is that they didn't let criticism and negativity stop them from reaching for their goals. In fact, they seemed to use it as fuel to reach higher. They're role models for all of us &mdash; women and men alike.</p> <p><em>Who inspires you to invest and save more?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/christa-avampato">Christa Avampato</a> of <a href="http://www.wisebread.com/the-7-most-successful-women-investors">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-15"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-investors-with-better-returns-than-warren-buffett">5 Investors With Better Returns Than Warren Buffett</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-dumb-401k-mistakes-smart-people-make">5 Dumb 401(k) Mistakes Smart People Make</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-cheap-easy-ways-to-invest-your-first-1000">4 Cheap, Easy Ways to Invest Your First $1000</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-save-26000-in-5-years-or-less">How to Save $26,000 in 5 Years or Less</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-top-5-etfs-you-should-buy-now">The Top 5 ETFs You Should Buy Now</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Investment business women investing success Wall Street Fri, 20 Feb 2015 14:00:09 +0000 Christa Avampato 1299816 at http://www.wisebread.com