Please translate this financial guidance for my elderly mother for me (is it a scam)?
My 80-year old mother's financial advisor merely sent me this email. A few years ago he recommended an annuity, so I'm not sure I can trust his advice. What do you construe he intends to do, and is it reasonable?I would suggest that we move 100K of the almost 400K that will be earn 4.1% in her stash account. My guidance would then be to allocate 40K into respectively of the two programs that I would recommend. One is yielding 6.2% and the other 6.3%. We would resign from the remaining 20K in money marketplace (currently earning 4.5% but will fluctuate and is subject to adjust as rates change). My objectives for these investment recommendations are preservation of principal, steady income, and means appreciation on the back downfall of the program. Our total return target over the life of the program is an annualized total return of 9% -10%. There is no commission, nouns or ongoing fee compensated by the client to go into these programs so the verbs is a net abandon.
Answers: I used to be a broker and now am a financial economist. Without knowing what the advisor is recommend, I would be deeply suspicious. A 6.2 and 6.3% concede is generous right in a minute, considering commissions and so I would be very mistrustful.
I would additionally be very on your guard because this guy implies, if true illegally, that the advisor does not receive paid. It could be that the advisor get an "introduction fee," which is technically not a nouns, commission or ongoing fee. A current surrender could mean, and does imagined mean, that a portion of the interest is in fact principal but is taxed as interest. You would thieve a capital loss when the sketch is closed, but are legally restricted on the deductibility.
The 9-10% target is obscure, how does one bring 9-10% when the highest returning asset is 6.3% which is giving in itself.
Go to bankrate.com for a better ridge account.
I would be suspicious, but you really call for the details.
he/you hasn't described the "programs".
how does this guy get rewarded? surely, someone pays him something from somewhere. "the company pays it" really means that the company raise fees and charges on the customer so that they can pay him.
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if the "program" is offered by an insurance company, I guarantee that this guy is getting a commission and that your mother would be, within essence, paying that commission.
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how would this "program" be superior to simply buying a dividend oriented mutual fund offered by a most important no load, low cost provider such as Vanguard?
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congratulate yourself for mortal suspicious. this smells.
never, ever buy something financial that you do not understand. and if it is trial to you, get an independent second evaluation every time.
The adviser doesn't appear to want to actually disclose much information. I would at lowest possible get a second assessment.
If anything, put some money in soaring yield CD's.
never do a entry unless document presented is transparent and understandable by majority investor.
Considering the age of your mother I rather recommend Cash deposit within a Bank, which will help within many ways - return too open market determined not low to an aged woman.
Actually it sounds like a pretty polite deal
largely because he is diversifying the account
My singular concern is that it sounds like he is
trying to put the money into Mutual Funds but here is no
commission, load or fees and that doesn't nouns
like any mutual fund I've ever see
Hopefully he is looking into exchange traded funds
and not a hedge fund. which is solely as good at the
nation trading the account.
I would want to know more roughly the "programs"
he mentioned. and take a fitting look at what stocks
or bonds they include.
We are in a incredibly shaky market right very soon. and anything
involving stocks (such as the funds I mentioned)
could be at risk.
The safest place for your mother's money right now
is surrounded by a bank. 4.1 % is a pretty righteous return as long as
its compounded more than once a year.
Money market returns are much better than bank
but are usually only Guaranteed up to 100,000
You can remove your risk and get a somewhat good return
by splitting the money up between several
money flea market accounts.
This strategy wont return as much as a well timed
stock purchase but It wont loose your money ether
Good Luck
The yield are not unreasonable. Heck there are some wall stocks paying that now. It would hold helped to own some information on exactly what these programs are. Could be REITs. If so the yields are not assured. Could also be set partnerships. Might be for a time safer.
I would ask specifically what are these programs?
I especially liked your comment nearly annuities. That does give one interval for concern.
Do i have to pay taxes on gains if I sell stock in a 401K?
Answers: No.
Unless you withdrew the funds from the 401K you would not be responsible for the capital gains taxes at this time.
Since 401K's are not generally 'self managed' and not normally 'liquid' then chances are the stock has been sold 'inside' your plan and therefore not subject to taxation at this time.
If you have removed the funds from your 401K you may want to discuss this with your tax professional or financial adviser.
nope..inside a 401k everything is considered unrealized until it's distributed. And at that point it's all considered ordinary income. no capital gains/losses associated with 401k in any way.
What's a moral stock between 10-15 $?
I'm looking for an established company that's maybe undervalue. I know that's harder to find. But as long as it's a site that won't go cleaned out tomorow that's good adequateAnswers: Looking at price is the absolute wrong road to determine if a stock is undervalued. Really the stock price does not thing at all.
Let's right to be heard that we have 2 companies.
Company A is worth $100 and have 1 common share going for $50.
Company B is also worth $100 also but have 10 common shares selling for $12 respectively.
Is Company B more undervalued than Company A? Nope. According to my example, the 1 share for A is underpriced by $50. Company B is overpriced by $2 a share.
Is Ford's stock at $6.50 underpriced compared to PFE at $22.71? Hell no!
I close to BAC, AEO, WFC, PFE, NTRI,
Consider NM. Closed Friday at $9.91 per share and it pays a 3% dividend.
http://finance.yahoo.com/q/ae?s=nm
Analysts are looking for $1.45 per share next year near a five year growth rate estimate of 66%
http://finance.yahoo.com/q/pr?s=NM
BUSINESS SUMMARY
"Navios Maritime Holdings, Inc., a seaborne shipping company, offers horse-drawn carriage, trading, storing, and other related logistics for international dry bulk cargo transportation. As of December 31, 2006, Navios owned 10 Ultra-Handymax (50,000 dwt-55,000 dwt), 9 Panamax (70,000 dwt-83,000 dwt), 1 Capesize (approximately 100,000 dwt) and 1 Handysize (10,000 dwt-30,000 dwt) product tanker vessel. It also time charters in and operate a fleet of 4 Ultra-Handymax, 1 Handysize, 14 Panamax, and 5 Capesize vessels underneath long-term time charters. The company serves raw materials producers, agricultural traders and exporters, industrial end-users, shipowners, and charterers. It also owns and operate bulk transfer and storage port facility contained by Uruguay. The company was formerly prearranged as Nautilus Maritime Holdings, Inc. and changed its name to Navios Maritime Holdings, Inc. within 2003. The company is headquartered in Piraeus, Greece."