Stocks are not a bad thing

So much talk about Wall Street. The Dow goes up the Nasdaq goes down.  Invest in technologies. Buy options.

What do you do, who do you trust? Wh do you believe?

People make money everyday in the stock market. And if your finances are in good condition you can buy stocks & invest as well.

It takes proper asset allocation to ensure that you don’t lose your life savings when investing in the stock market. Following the 3 bucket asset allocation system is key. Have you set your 3 bucket system up yet? If not there is no better time than now.

Remember When Interest Rates Were Positive?


“There’s got to be something we can do to get this economy rolling.”

“There isn’t, sir.  We’ve taken interest rates as low as they can go.”

“Don’t use ‘they’ to refer to interest rates.  ‘They’ should be used only in reference to people.  Use ‘these’ or ‘those’ or something.  Rework the sentence.”

“Yes, sir.  We’ve taken interest rates as low as these…um, those…the interest rates can go.”

“That can’t be true.  How low are the rates now?”

“Zero percent.”

“Zero!  So isn’t that igniting economic growth?”

“It is reported that more and more people are choosing to move in with their parents rather than start Fortune 500 companies.”

“But it’s cheap to get a loan!  Zero percent!  Why aren’t people going into more debt?”

“I don’t know, sir.  A lack of parking near the bank may be a problem.”

“Well, if zero percent won’t do, we’ll have to go below…

View original post 402 more words

Savings tips from Gary


1.)   Work toward getting your monthly living expenses to be under or as close to 50% of you monthly income as possible.
2.)   Pay yourself first. ASAP.
3.)   Set up your 3 Bucket Asset Allocation Plan TODAY.
4.)   Have enough money in a penalty free/Tax excluded plan to cover your monthly living expenses for as close to 9 months or greater ASAP.
5.)   Protect yourself and your loved ones from any unexpected drains on your income.
6.)   Spend no less than ½ half the time you spend planning special events on planning for your financial future.
7.)   Expect the unexpected. Bad things do happen to good people.
8.)   When you take care of today; tomorrow will be a little easier to get through.
9.)   When you are lost in what to do, ask for help
10.) Adjust the deductibles on ALL insurance policies to reflect how you use them. This can free up money to add to your 3 Bucket Asset Allocation plan.

A simple look at debt

There is a lot of talk in the media and around the dining room table about debt. Consumer debt, national debt and even how to make the next car payment, Americans are all taking about debt.

Before we talk about eliminating debt lets focus on why debt is present in our lives in the first place. Debt is neither bad or necessary until we look at how the debt was first created.

Leverage. Some debt is generated from the idea of using other peoples money instead of our own. Keeping money making money is a good thing. Why would a business or person want to pay upwards of 30% in costs and potentially lose earnings if they can use someone else’s money and pay a little interest along the way. Isn’t a 20% interest more attractive than 30% in fees? Just saying.

Lack of personal capital. We need to have something to drive to get us to work and back. If we don’t have the $5k to $50k to pay for the vehicle we either will go without it or use someones money to pay for the car for us.

I want it today, I don’t have the money but I can afford to pay monthly for it. This is where some of us get lazy in our decision making. It is easier to get those new clothes, get that new appliance or even pay for gas when we lack the cash flow to purchase them by using the Visa or Master Card.

Are there more reasons. Probably. I think that these are the core reasons why most debt exists.  If you were to look at your present situation you will probably notice that you pay monthly bills that were created from any 2 of the above reasons to why we have debt.

Perhaps you are living paycheck to paycheck and would like to lower your debt and have more money at the end of the month. Once you understand why you created the bill in the first place we can then work on changing your mindset and eliminate some of the debt you currently have.

Thank you.

What’s impacting your portfolio?

We hear about the jobless numbers, retail sales figures, housing sales, and  how bad the American economy is. I am not here to say that we are in good shape. The facts are the facts. America is in a financial mess.

Do these reports have an impact on your portfolio and your retirement plan? Certainly. Are they the only things that influence your balance and performance? Let’s talk about that.

While consumer confidence, employment figures and real estate sales all impact Wall Street hourly, there are ways that a person can create a hedge that will lessen the impact to them personally. Simple tweaks to the plan can create dividends that will create wealth and a place you in a position to have a stable, steady income when you need it.

We talk about a variety of solutions being used by people of all walks of life that helps lower the level of worry they have when they look at their overall portfolio. How is your portfolio looking? How is the 1st and second buckets performing in 2012?

The IndyWealthCoach is here to answer questions and will come to your group and share some practical solutions that can lower the stress you feel about  today’s economy. There is no better time than now to get learn a fresh approach to money management.

Don’t Make the same critical errors your parents made

401k, Retirement, Corporate Bonds, Bailouts, Pensions, Stocks, EFT’s, IPO., Insurance, Debt Ceiling.

The media is reporting both the positive and the negative about money.  Which is how we are conditioned to act the way we do when it comes to finances. Each camp has their mantra. Each one trying to influence the public with their ideas.

SO what did our parents do? Most of them followed like sheep follow their shepherd. Some of our parents found a good shepherd who taught them the true way that money works and they now either live a comfortable retirement lifestyle  or if they have passed, have left a nicely packaged inheritance for their loved ones or favorite charity. Unfortunately most of them listened to shepherds who were not fully educated in planning for a strong financial future. They listened to the stories of BIG MONEY being made in the likes of the oil boom, dot com and even housing boom to name a few. Only to learn the one simple rule.  It’s not only the time in the market thats important but more important is the timing.

What do I mean by that? Well, if the market is high, you cash in you winnings and principal, you walk away on top. But if you need to “cash in”

A fresh look at why we save

when things are declining or have hit the bottom, life can get a little bit stressed.


What happens when the Market goes sideways.

As a novice investor, you probably recognize that the market never moves only up and down, When you look at a chart for a specific stock, fund or index, they travel sideways as they travel the course of time.

Let’s pretend that each year there is an alternating 10% gain and loss. Could this really happen? Absolutely not. But this serves as a great teaching tool. Let’s also assume that the initial account value is $1000.


Here is what is interesting. If an account performed like this, with a 10% gain in year one, a 10% lossin year 2 and then alternated back and forth for 10 years, it’s average return at the end of the 10 years would be ZERO. But when we look deeper the ACTUAL return would be negative 4.9%. That’s right, you have now lost money in a ZERO average return performing investment.

But the market was flat. Right? Well, no. A flat market is defined as “A securities market in which there has been no tendency either to rise or to fall significantly. Also called sideways market.”The key is NO tendency to rise or fall.

The average return and the actual return will never equal one another when the negative numbers are factored into the equation. When you look at this example it would make more sense to have put the $1000 into a coffee can and opened the can 10 years later.

There are financial principals that protect your money in the exact example I have shown you above. This principal implements the power of zero in it’s calculation, protecting your principal and giving you a positive return in the end.

Year 1           +10%          $1,100

Year 2           –   0%          $1,100

Year 3           + 10%         $1,210

Year 4           –   0%          $1,210

Year 5           + 10%         $1,331

Year 6           –   0%          $1,331

Year 7           + 10%         $1,464.10

Year 8           –   0%          $1,464.10

Year 9          + 10%          $1,610.51

Year 10         –  0%           $1,610.51

How would it feel to live through the same situation and look at the account statement and see $1,610.51 int he account. That’s right. $1,610.51. $659.50 Actual money in the same Average period of time. Oh, by the way, that is an actual gain of 61% compared to an actual loss of -4.9% in a Zero average return market.

Add to this the effect of annual fees along with future taxes and you could end up with much less than you originally projected.

Do you see the power of Protected Growth Indexed Strategies? Are you starting to see how wealth is created? If you would like to learn more I will be happy to introduce you to an adviser that will help you out.

Average vs. Actual Rate of Return

Do you know the difference between average and actual rate of return in an investment? If not, you are probably losing a lot of money without realizing it. When you get the statements in the mail from your 401k or mutual fund and you see the percentage of how much your portfolio made or lost, do you know what they are talking about? One very important thing to understand is the difference between average and actual rates of return.

First of all what is rate of return? The dictionary defines it is “The gain or loss of an investment over a specified period, expressed as a percentage increase over the initial investment cost. Gains on investments are considered to be any income received from the security, plus realized capital gains.” Or, in real simple language it is how much your investment is making. But when you see that your portfolio has earned 8% for the past few years, what does that really mean? Is that an average rate of return or is it the actual rate of return?

Let me give you a very simplified example over four years to illustrate this point. Suppose you start off with $1,000 to invest. You put it into the market and have a great year, earning 100% for the first year. At the end of the year you would have $2,000 in the account. In year two things don’t go so well and your portfolio loses 50%. At the end of year two you would have $1,000 in your account. In year three things go fantastic and you earn 100%. At the end of year three you would again have $2,000 in your account. Then in year four things look bleak again and you lose 50%. At the end of year four you have $1,000 in your account. Your spreadsheet would look like this:

  • Starting Balance              Year  Annual Rate of Return  Year End Balance
  • $1,000                            1                     100%                           $2,000
  •                                      2                      -50%                            $1,000
  •                                      3                      100%                           $2,000
  •                                      4                       -50%                           $1,000

What do you notice as you look at this spreadsheet? The biggest thing that should jump out to you is the balance in the account. You see that your beginning balance and your ending balance are exactly the same. So how much money have you made over those four years? ZERO!!! You have exactly the same amount at the end of four years that you started with. So what is your actual rate of return for the four years? That’s right, it is ZERO!!!

Now here is the real kicker. What is your average rate of return for those same four years? To figure this out, add up all the rates of return for each individual year and divide by four. If your calculator works the same as mine you should also come up with an answer of 25%. Wow! A 25% rate of return is great! Anybody would be dying to get a 25% rate of return in their investments.

Well guess what? A mutual fund that had this exact performance could advertise in print “Our fund has averaged 25% over the last four years!” That is a true statement. It is not deceitful, illegal, misleading, dishonest or anything. But with that 25% average rate of return, how much money did you actually put in your pocket?

So which is the most important to you, the average or the actual rate of return? Obviously the answer is the actual rate of return. Who cares that your portfolio averaged 25% over the last four years if you didn’t make any money? And remember, this is an oversimplified example. In real life there are also management fees, fund fees, taxes, inflation, and other costs that have to be factored into the actual rate of return.

As you can see from this example, having an understanding of the difference between average and actual rate of return is critical. Knowing how to spot the difference between them will make a huge difference in your retirement. Instead of retiring and wondering where all your money is, you will have both your money and peace of mind.

Cash on hand or cash flow. Which provides the greatest security?

When people think about investing and saving for retirement do they consider everything possible. Will I have enough money in the bank, 401k or pension to provide the lifestyle I am used to? Do I need to work so I have enough money to pay the bills? What if I make too much money and have to pay taxes?

The question of having enough money is a hard one to answer. Everyone has their own ideas and every investment firm tends to use their own formula. But what is that magic number.

Most people do not answer the more important question which is, How much money do I need each month to continue my lifestyle while insuring against unforeseen losses? Do you have an investment insurance program in place? Have you even considered one?



Make Every Dollar Count

I have many clients who set aside money or a particular asset with the intention of leaving the asset to their family, usually children or grandchildren, but sometimes to a church or a charity.  Most often these accounts are IRAs, annuities or savings accounts.


There are two questions that are commonly asked by clients regarding these assets.  First, is there a way I could increase the amount of the legacy for my loved ones?  Second, is there a way I can minimize the amount of income taxes I have to pay during the remainder of the time these funds stay in the account?


I am writing you to let you know that there is an excellent strategy for accomplishing both of these goals.  That strategy is called Capital Transfer.  You can immediately increase your estate and provide a legacy for your children or favorite charity that under current law is not subject to federal income taxes through using life insurance.


I am making a focused effort to inform all of my clients of this wonderful strategy for assuring that their beneficiaries receive “An Enhanced Legacy.”  I will call you in a few days to see if you might have “earmarked” assets to be left to your loved ones and if you would be interested in learning more about this strategy

What type of returns can you expect for an Equity Indexed Annuity?

Expected Performance

The interest rate you receive from an index annuity varies because your investment is linked to the S&P 500, or a similar stock market index. The returns will also differ from product to product, because of different crediting methods. An index annuity balance is impossible to predict, but we can look back at how they would perform in past market conditions.

Index Annuity vs S&P 500 Performance

The above is a hypothetical comparison of an index annuity vs a direct S&P 500 investment. This is how your balance would have looked between 1999 and 2009. The index annuity in this example has typical contract terms: 100% participation rate, 9% cap, and it resets annually.

A $100,000 investment directly into the S&P 500 in 1999 would have resulted in an approximate balance of $73,459 by 2009. The investment would have lost over $15,000 not to mention inflation. On the other hand, your index annuity would be worth over $150,000, a difference of over $77,000.

Video of real life example.

Notice that index annuity never loses ground when the S & P has a negative year. The reason for this is that it ‘locks’ in pervious years’ returns, meaning it will never go lower than its highest point. Sound too good to be true? The trade off is that in periods of substantial market growth, the annuity will only participate in a portion of it.

Performance in a bull market

This second chart is show the same annuity vs the S & P 500, only in one of the biggest bull markets, 1990-2000. Because an Indexed Annuity ‘Caps’ the rate of return (in this scenario 9% per year), it will not see the full returns in market conditions such as this.

This means, if you’re looking for maximum growth and you are less concerned about the possibly of losses, a fixed indexed annuity may not be the right choice. However, if you want principal guarantees with the potential to surpass the rate of return of a traditional annuity, an indexed annuity would be worth taking a look at.


With respect to retirement planning, index annuities offer greater overall benefits than directly investing in stocks or even a market index. Debt-based instruments like bonds and CDs are a guaranteed bet (the same as index annuities), but they offer half the growth potential. This, in addition to miscellaneous advantages like tax-deferral, death benefits, lifetime income options, and probate avoidance, make index annuities a great candidate for your retirement plan.

For an in-depth explanation of index annuity products and to get a free comparison of quotes from the highest-rated insurance providers, Click Here

Disneyworld and the evil Life Insurance Industry

Perhaps one of the greatest  visionaries of the modern day, Walt Disney had a dream and pursued it with passion.
He made careful decisions throughout his life and did all he could in his power to make dreams come true for everyone.
But did you know that a whole life insurance policy helped fund his biggest dream. My guess is that he realized that if he borrowed from a bank he had a partner in his dream that made major financial decisions that could have hampered his plans. Or if he went to the private sector he would have to find ways to satisfy them so in order to be self sufficient he used the method that other wealthy individuals use.
If you and I could sit down I can show you a way to create the same type of “bank” that Disney used.