retirement Archives - Page 131 of 585

Apache is functioning normally

May 24, 2023 by Brett Tams

[Editor’s note: This is Part I of a two-part series on whether it makes sense to include gold in your portfolio. Part II is “Why gold should be part of your investment portfolio.”]

Humans have valued gold for several millennia, and that will likely continue. It is understandable, then, that a human such as yourself might consider trading some green for gold. I say, “Don’t bother,” and here’s why….

1. Gold isn’t a consistently good investment

The wisdom of an investment decision depends on when you buy and when you sell. This makes all kinds of things — from dot-com stocks to Beanie Babies — extraordinarily good investments … as long as you sell before prices plummet.

Gold is no different, as current owners know; it was a fabulous investment through most of the 2000s, but has lost a third of its value since 2011. This isn’t unusual. Check out the returns on an ounce of gold over the past 40 years, based on data from the Federal Reserve Bank of St. Louis. The rolling returns measure performance over various holding periods, each starting a year later. For example, five-year rolling returns are the average annual price changes in gold starting with 1975-1979, then 1976-1980, then 1977-1981, and so on. The “% Positive” is the percentage of times that gold was at a higher price over the indicated period.

Gold , 1975-2014	1-yr Returns	Rolling 3-yr. Returns	Rolling 5-yr. Returns	10-yr. Rolling Returns
Best	146.1%	60.1%	33.4%	11.4%
Worst	-32.6%	-13.4%	-11.3%	-5.1%
% Positive	57.5%	55.3%	66.7%	67.7%

Most investments have short-term volatility and ever-present unpredictability, but gold is all over the place. Most investors would consider a decade long enough of a holding period to ride out the ups and downs of a volatile asset. However, a third of the 10-year returns for gold were negative. I don’t know about you, but I’m not thrilled to invest in something today that, historically, has a one-in-three chance of being worth less in 2025.

2. Gold isn’t an inflation hedge

You invest today in order to pay for something in the future. Thus, your investments will need to keep up with whatever that something costs years down the road. Unfortunately, gold may not do it for you.

Cast your eyes once again upon the table above and ponder whether an asset that loses value over many multi-year periods is an effective inflation-fighter.

Also, consider this: The price of gold reached approximately $850 an ounce in 1980, and then began a long decline that didn’t end until 1999 at around $250. Gold didn’t exceed its 1980 peak until 2008. That’s a 28-year period during which gold didn’t increase in value. Something that cost $1,000 in 1980 cost $2,600 in 2008 due to inflation, and gold did nothing to make up the difference.

3. Gold isn’t a “productive asset”

In his 2012 annual letter to Berkshire Hathaway shareholders, Warren Buffett described three types of investments. The first is what he called “investments that denominated in a given currency” — e.g., cash and bonds.

The second type are “assets that will never produce anything,” such as tulips (the subject of a 17^th century speculative mania), houses, and gold. Buffett pointed out that the total value of all the world’s gold (170,000 metric tons) could be melded together to form a cube that is roughly 68 feet per side. Back in 2012, that cube would have been worth $9.6 trillion — enough money to buy up all the cropland in the U.S. as well as 16 ExxonMobils, and still have $1 trillion left over “for walking-around money.” A century later, all that land and all those oil companies will have produced trillions of dollars’ worth of food and dividends, but the gold will still be just 170,000 metric tons of metal.

Those farms and ExxonMobils are examples of Buffett’s third (and preferred) category: investments that make things or provide services and can charge higher prices during inflationary times. For the average person, the easiest way to do this is by owning pieces of hundreds of businesses via a low-cost index fund, a productive asset that Buffett recommends for 99 percent of investors, including LeBron James on CNBC a couple of weeks ago.

Here is a version of that table above, but using the return figures for the S&P 500 index instead of gold.

S&P 500, 1975-2014	1-yr Returns	Rolling 3-yr. Returns	Rolling 5-yr. Returns	10-yr. Rolling Returns
Best	37.2%	30.8%	28.3%	19.0%
Worst	-36.6%	-14.5%	-2.3%	-1.4%
% Positive	82.5%	84.2%	86.1%	93.5%

The average annual return for the S&P 500 over the entire period was 12.1 percent (compared to 4.3 percent for gold), which includes the cash that most companies pay their shareholders in the form of dividends. Historically, dividends have grown at a rate that meets or beats inflation. Why? Because companies charge higher prices over time.

Back in 1980, gas cost $1 a gallon, a new car cost something like $6,000, and $9 got you into the Magic Kingdom at Disney World. As prices have risen over the years — it now costs more than $100 to see Mickey up close and personal — companies have made more money.

You won’t receive such increasingly bigger checks from gold. It doesn’t fuel cars or fill bellies. It doesn’t provide transportation or entertainment. Yes, it looks pretty; but as Buffett wrote in that 2012 annual letter, “You can fondle the cube, but it will not respond.”

4. Miner losses, slow-growth jewelry, and taxes — oh, my!

Here are a few of my other beefs with bullion.

Some folks choose to invest in companies that work in the gold biz (such as miners) rather than the gold stuff itself, since these are businesses that make money by providing services that will be required as long as humans dig stuff out of the ground to make other stuff. However, these companies’ fortunes often ebb and flow with gold’s luster, which is partially why the Vanguard Precious Metals and Mining Fund has lost money in each of the past four calendar years as gold prices have crashed.
What about things made from gold, such as jewelry, that also have decorative, sentimental, and/or flaunting value? Whether an individual item is a good investment depends on many factors, including craftsmanship, taste, and all the materials used. But the U.S. Bureau of Labor Statistics does have a jewelry category in its calculation of the Consumer Price Index. An item that cost $100 in 1986 would be worth $166 today, according to this measure. That’s less than a 2 percent annualized return. Plus, such things have to be stored, secured, and insured, and are not easily converted into cash.
Most forms of physical gold are considered collectibles by the IRS, and short-term gains are taxed as ordinary income while long-term gains are taxed at a 28 percent rate — higher than the 15 percent to 20 percent long-term rate on stocks. That higher long-term rate also applies to the widely held SPDR Gold exchanged-traded fund (ETF) with the GLD ticker (unless held in a tax-advantaged retirement account).

For these reasons, I would not advocate keeping gold in your portfolio; but tomorrow’s post will offer different perspectives on the subject of gold. Perhaps my reasoning will tarnish the luster of including gold in your portfolio a bit; but then again, it is always wise to consider different points of view before coming to a decision on matters like these.

What do you think? Should gold be part of your portfolio?

Source: getrichslowly.org

Apache is functioning normally

May 24, 2023 by Brett Tams

fizkes / Shutterstock.com

Even if you still haven’t filed your 2022 tax return yet because you requested an extension, it’s a good time to review this year’s tax situation, especially if you expect significant changes to your income.

Whether you hire a tax professional to file your taxes or file them on your own, you can review not only income projections but your possible tax bill too.

Following are key moves you can make right now that could lower the taxes you will owe in 2024. If you are able to implement these steps now, as opposed to later in the year, you’ll have more time to reap the benefits.

Review your tax withholding

Piotr Swat / Shutterstock.com

A big tax refund isn’t necessarily a good thing: It could simply mean that you had too much withheld from your paycheck for taxes throughout the year, which is akin to giving the federal government an interest-free loan.

So, if your last tax refund was too small or too big for your liking, or if you owed taxes this year, it might be time to update your withholding by filling a new Form W-4 with your employer. Or at the least, consider using the IRS’ Tax Withholding Estimator, a free online tool that can help you determine whether you should withhold more or less from your paycheck this year.

By adjusting how much tax is taken out now, you’ll have more paychecks to spread the extra amount over.

If you’re lucky enough to no longer need a full-time job and are enjoying retirement, you may need to file a Form W-4V or W-4P as you begin to receive Social Security and any pension income, instead of a Form W-4. The other forms enable you to request that more (or less, if appropriate) be withheld from your retirement income this year to avoid paying a hefty tax bill next year.

Figure out your income bracket

Andrey_Popov / Shutterstock.com

If you can estimate how much income you will earn this year, you can also project your 2023 income tax rate. Here’s how:

Figure out your expected income for this year. If you’re unsure or want to be safe, assume it will be higher than your 2022 income.
Find the corresponding income bracket, or income range, for the tax filing status that you expect to have for 2023 (such as single, head of household, married filing jointly or married filing separately).
Find the tax rate (percentage) that corresponds to your expected income bracket.

If you find that your expected income puts you near the next-highest income bracket, implementing some of the following moves could keep you from paying more tax. In other words, these steps can lower your taxable income, which helps ensure that you stay in your expected income bracket rather than getting bumped into the next-highest bracket and thus having to pay a higher tax rate.

Plan out your retirement contributions

Jason Stitt / Shutterstock.com

You can lower next year’s tax bill by putting away some of this year’s income into a tax-deferred (non-Roth) retirement account. Contributions to such accounts generally are tax-deductible.

If you’re under the age of 50, you can put $22,500 in an employer-sponsored 401(k), for example. That amount increases to a total of $30,000 if you are 50 or older.

Gig workers, small-business owners and other self-employed taxpayers can also lower their taxable income by contributing to a retirement account for the self-employed, if eligible.

Able to put away more? Then consider contributing to a traditional individual retirement account (traditional IRA), if you do not exceed the income limitations. You can squirrel away $6,500 in an IRA if you’re under the age of 50 or a total of $7,500 if you are 50 or older.

You’ll have more time to max out this year’s contributions if you start now.

Contribute to an HSA

fizkes / Shutterstock.com

If you have a high-deductible health plan, consider lowering your taxable income by funding a health savings account (HSA). Contributions are tax-deductible.

For 2023, you can put away up to $7,750 in an HSA if your insurance provides coverage for your whole family. Single individuals can put away $3,850.

If the funds are used for eligible medical costs after you withdraw them, you won’t pay tax on the withdrawals, either. Another great feature of these accounts: You don’t have to use up all the money you contributed in the same year. You can let it grow, unlike with a health flexible spending account (health FSA).

Contribute to an FSA

XiXinXing / Shutterstock.com

If you don’t have access to a high-deductible health plan, you may have access to a health flexible spending account. Health FSAs allow you to put money away before it’s taxed to pay for medical costs, which means contributions are tax-deductible. However, these dollars must be used in the same tax year they were contributed.

Check with your employer to find out if you have access to a health FSA — or a dependent-care FSA, for that matter. The latter works like health FSA except the funds can be used to pay for child care expenses instead of medical expenses.

Plan out your RMD

wavebreakmedia / Shutterstock.com

Generally, taxpayers who turned 72 or older prior to 2023 must withdraw a required minimum distribution (RMD) from their tax-deferred retirement accounts for the 2023 tax year. The deadline for doing so is Dec. 31, 2023 — and missing that deadline can trigger a steep tax penalty.

So if you must take an RMD for 2023, estimate the amount of the RMD (the IRS offers worksheets and tables to help) and plan for it. For example, do you want to take it all at once or in multiple withdrawals over the course of the year? If you take it all at once, when is the best time for you to do so?

It’s also a good idea to see how this required withdrawal will increase your income and possibly your tax liability for next year.

Add up those business expenses

BGStock72 / Shutterstock.com

If you are among the millions of Americans who are self-employed, make sure you understand what expenses can be deducted. By tracking your deductible expenses throughout the year, you can lower your taxable income, which likely will lower your taxes next year. You’ll want to keep accurate records of all deductible expense, though.

If you’re not sure what you can deduct, check out “6 Things Every Self-Employed Worker Should Know About Taxes” or visit the IRS’ Gig Economy Tax Center or its Self-Employed Individuals Tax Center to learn more.

Like
Article Add a Comment

Source: moneytalksnews.com

Apache is functioning normally

May 24, 2023 by Brett Tams

Let’s start off with everyone’s least favorite kind of data. Without checking, do you know how much you have in debt? And how much of that total is interest?

Are you cringing? I certainly am whenever I think about how much debt I owe.

Turns out, we’re not just worried about debt, we’re planning our lives around it. CBS News reports that 74% of student loan borrowers in Gen Z and 68% of Millennials are putting off critical financial decisions — like saving for emergencies and building a retirement fund — because of student debt.

This crisis means there’s a huge market for Changed, a microsaving app that funnels your spare change directly toward debt payments.

What is Changed?

Changed uses the “round up” model popularized by other spare change apps like Acorns. The Changed app rounds your purchases to the nearest dollar and transfers the rounded-up amount to a bank account, which then sends the money to your loan issuers.

Changed was founded by Dan Stelmach, who figured spare change installments could help his debt load go from ridiculous to manageable. And an automated savings app could do the work for him.

In 2018, Stelmach and his brother Nick Sky pitched Changed on the reality show Shark Tank, walking away with an investment to kickstart the company. At the time of this writing, they’ve helped borrowers pay down over $25 million in total loan costs.

Read more: Student Loan Debt: Understanding the Growing National Crisis

How Does the Changed App Work?

Download Changed on the Apple App store (for iOS) or Google Play store (for Android). There are links to download on the Changed website.

First, you enter your basic sign-up information (address, birthdate, phone number). This is only used to set up your account.

Next, Changed opens an FDIC-insured savings account for you through the financial software company SynapseFI. Banking info is encrypted and secure, as with any savings account. The account is for storing your funds until they’re transferred to the student loan provider.

Then, you’ll enter your student loan information by linking to your loan servicer. Changed links up to almost all federal and private loan servicers — if your lender isn’t listed, let Changed know and they’ll help you add the info manually.

Changed walks you through where to find all your student loan stats, like your account number and the date your loans were issued. You can round up from multiple accounts, and from more than one servicer. You can also pick which account you want to fund first.

Read more: How Student Loans Work

Finally, you’ll link your Changed account to your checking or primary spending account(s). Changed doesn’t store your checking account info, it just has you log in through the app.

From there, the app looks at your spending patterns and starts setting aside your spare change. If you’ve used other microsaving apps, this pattern will be familiar.

Each time you make a purchase, Changed rounds the purchase amount up to the nearest dollar and saves the difference. If you buy a cup of coffee for $3.45, Changed would round up to $4 and save the extra 55 cents.

Once your total round-ups reach $5, the app transfers the money to your Changed savings account. Round-up transfers are limited to $10 a day so you don’t overdraw your checking account by accident.

Once the round-up amount in your savings account reaches $50 or $100, the app transfers the money from savings to your debt balances. Until then, the money’s still available to you. Loan payments take about five to 10 days to process, and Changed limits them to $500 per week.

It’s worth noting here that Changed payments do not replace your regular payment plan. (That would be nice, right?) Instead, they help you reach your payoff goal a little faster — or a lot faster — without much effort on your part.

Read more: The Pros and Cons of “Spare Change” Investment Apps

How Much Does Changed Cost?

Changed charges users $3 a month. The app is free to download; charges kick in once you start using it.

The monthly fee covers the cost of maintaining your savings account and moving money to your loan servicer. There’s no free trial period — once you start, you’re committed. Changed auto-renews your subscription each month. But the $3 fee covers all the site’s features, so you won’t be hit with extra charges.

Changed Features

Progress Screens

Changed lets you see your repayment progress in real time, which can be super motivating.

You can toggle between a few different screens on the app. The home screen has a nifty visual to show how the money you’ve “squirreled” away is adding up.

Other screens show you:

Round-up amounts from each purchase
Extra payments applied to your loans each month
How much each payment saves you in student loan interest
How much you could save over time
How early you could pay off your loans

Pick Your Savings Speed

Changed has a few different savings speeds — Budget, Standard, and All mode — which you can select or change. This is a good feature for people whose income or expenses fluctuate.

You can also pause transfers for 15, 30, or 60 days if you need to budget money toward other goals for a while.

Extra Payments

On the other hand, if you want to accelerate your savings speed, Changed is all for it. The “BOOST” rocket on your home screen lets you make an additional single or repeated transfer of $1-20 toward your loan principal, on top of the money you’re already saving.

Read more: Principal Only Vs. Principal and Interest. Which is Better?

Link a Credit Card

If you can link your checking account to a credit card account, Changed will round up your credit card purchases. Round-ups go through the checking account so the charges don’t raise your credit card interest.

Have Another Payer Help Out

If a family member or loved one is chipping in to help you with loan costs, Changed lets them sign up for their own account. They’ll link their own checking accounts, but they’ll need your info to link their loans. You can also use this feature if you’re giving a helping hand to someone else.

Other Features

For those who want or need to refinance, Changed has a ton of bank offers on the site so you can compare interest rates.

If you have time and want to be really extra — by referring a friend, buying from a Changed sponsor, or taking their “Know Your Loan” course — Changed gives you “perk points” which enter your name in a weekly drawing to win free payments.

Read more: Student Loan Refinance Options

Stash My Cash

Changed can also help you build your savings accounts. You can choose to split your round ups and put some in savings and some to debt.

For example, you can choose to put 75% of your change towards debt but move 25% of the money into your savings account.

This will help you meet other goals while you still make progress towards your debt.

My Experience Researching Changed

I found Changed to be refreshingly forthcoming about the limits of their automated savings app. They follow federal guidelines about which loan costs to pay first — fees, interest, and principal, in that order — and they don’t promise that payments will go directly to the principal.

Their main communication method is email; I couldn’t even find a phone number on the site. I prefer email contact, so that’s fine with me.

But down to brass tacks: How much money would I save with this app? Changed, like most micro-saving apps, can’t give you an estimate before they look at your spending patterns — round-up amounts can be all over the place depending on your spending habits.

I figured many of us could spend enough to make $50 in round-ups in the average month. Then I crunched some of the latest available averages on student loans from Education Data:

The average federal student loan debt per borrower is about $37,693.
The average monthly student loan payment is around $460.
The average interest rate is a rounded 6%.

So, let’s say a borrower pays off a $37,693 loan at a 6% interest rate for 10 years.

Without any microsavings from Changed, they’d make an average monthly payment of $418.47. Their total interest would add up to $12,523.35.

With $50 a month in Changed microsavings, their average monthly payment would go up to $468.47. Their total interest would be lower, since they’re paying down the loan more quickly — just $10,648.63.

Changed would save this borrower $1,874.72 in total interest payments over the loan’s life. Even subtracting the $360 you’d pay in 10 years of Changed fees, that’s still $1,514.72 saved in interest.

These savings may be even higher if you have a larger loan principal or save more through round-ups.

It’s hard to argue with these numbers, so I may have to give Changed a try.

Who Should Use Changed?

People Who Struggle to Prioritize Extra Loan Payments

Part of the magic of spare change apps is that they take away the cognitive work of saving money, or the part where you have to remember to transfer a little extra into savings (on top of all the other things you have to remember).

If you’d like to make extra loan payments but you doubt you’ll actually make it happen, Changed may be for you.

People with Competing Financial Priorities

Micro-saving apps are designed so you don’t miss the extra round-up cash, because the transfers are so small. Maybe you want to apply heftier payments to other debts with higher interest rates, like credit cards. Changed makes sure you’re not neglecting your loans in the process.

Borrowers with Single or Multiple Loans

If you have more than one loan and you want to direct payments to a specific loan first, Changed can arrange this for you.

Borrowers in Deferments or Grace Periods with their Student Loans

Changed lets you get an early start on loan payments if you can, without affecting your repayment status.

Frequent Debit or Credit Card Spenders

The more you spend, the more round-ups you’ll have (within the $10 daily limit). If you already spend a lot on your debit or credit card each month, you’re likely to build savings quickly.

Who Shouldn’t Use Changed?

People Who Want Full-Service Repayment Assistance

While Changed has some borrower education, it doesn’t offer specific guidance — like comparing different repayment plans or exploring your options for loan forgiveness. It can work in tandem with other debt management resources, but not as your only resource.

People Who Use Other Round-Up Apps

More specifically, if you already use a no-fee spare change app or you’re already budgeting to make extra payments to your loan servicer, you probably don’t need Changed. The fee covers the work of Changed taking these steps for you.

People Who Want to Pay off Their Debt ASAP

Changed doesn’t pay your loan providers until you’ve gotten to $50 or $100 in your round-up savings, which could take some time. Setting aside extra money for student loan payments on your own may get the job done faster, if you have the funds to do so.

Source: moneyunder30.com

Apache is functioning normally

May 24, 2023 by Brett Tams

123 Shares

I know there is something about a mosquito, an albino, and “feeling stupid” but, to be honest, I have no idea what the lyrics in “Smells Like Teen Spirit” even mean.

However, the nonsensical lyrics and simplistic melody didn’t stop Kurt Cobain and his grunge band Nirvana from creating one of the most memorable songs of the century, dominating the airwaves when it was released in 1991 and only increasing in popularity over the past twenty years. Wikipedia even calls the song “one of the greatest rock songs of all time.”

While I don’t understand the meaning of the song, every time I hear it I think of one thing: my retirement.

Let me explain.

Living Like A Rock Star

Immediately after marrying the girl of my dreams, I began looking to buy a home. Neither my wife nor I made a lot of money but we had decided that it would be cheaper for us to buy a home than to rent (and far better than living with family.) We began to look at our options and discovered a small duplex that was in our price range. This property consisted of two separate homes crammed onto one small lot. We bought the property, cleaned up both homes, moved into the small one-bedroom home in the back, and put a renter in the home in the front.

Soon after our tenants complained of “flashes of light” coming through their front windows. I thought nothing of it.

Several years went by and various tenants moved in and out. I heard the same story several times and assumed the flashes were the county or the city doing some kind of analysis. Finally one day the tenants got a knock at the door and opened it to several tall, blonde Swedish tourists.

They wanted a tour of Kurt Cobain’s house.

I knew Kurt Cobain was originally from my city (Aberdeen, Wa) but little did I know – my duplex was actually his first home. I discovered later that Cobain had actually lived in both homes, moving from one house to the other during the first year of his life. His parents moved again to a new location before Cobain was even two years old – but his brief residency at the two homes was enough to put my little duplex on the tourist route of those looking for a glimpse of Cobain’s past.

Despite the cool background story- the “Cobain connection” is not my favorite part about that duplex.

It get’s better.

“What could be better than a rock star living at your home?” you ask!

…well, a lot of things.

Jesus
A new Star Wars movie
“DoubleStuf” Oreos
Kittens

You get the point. It’s not that great compared to a lot of things.

However, what I’m talking about is the freedom that duplex provided.

Starting Out Is Hard

Life is expensive and your first few jobs probably don’t pay a lot. Sure, there are a lot of great tips for saving money, but most tips don’t make rent any cheaper or help you earn much more money.

However, buying that duplex did both.

The total cost of the duplex was $80,000.00. With a 3.5% down payment through the FHA loan program (well, it was 3% at the time) the total down payment was just under $3,000 and our monthly payment (including all expenses) was just $600.00 per month. The front home rented for $600.00 per month.

Free living!

My wife and I now lived in our own home for absolutely free. Granted, I needed to fix things when they broke and I had to learn the ins and outs of being a landlord – but we were living for free.

A year later we moved again to a different home (purchased a larger home just one block away) but we still owned the duplex. We simply rented the back house out for $500 per month and now that duplex creates positive income each and every month. Sure, there are maintenance issues that come up every so often (which I usually hire out) and I’m not going to say I always love being a landlord – but starting out with a duplex was one of the best decisions I have ever made.

The Benefits Of A Duplex

I’m not one of those gurus who is going to tell you buying a house is the best thing for you to do.

In reality – buying a home is not right for everyone.

I’ve purchased a lot of properties over the past several years (including single-family homes, multifamily properties, and even an apartment complex) and I spend a lot of time teaching people how to invest in real estate and buy their first home – I recognize that this isn’t the right path for all. I love real estate and especially in the financial leverage real estate has for investments – but others might hate the idea of investing in any type of real estate.

However, if you’ve weighed the options and believe that home ownership is a path you want to pursue, buying a duplex is an excellent option for your consideration. Let me explain a few reasons why:

Easy to Qualify For: Qualifying for a small multifamily property (duplex, triplex, and 4-plex) is exactly the same as trying to qualify for a single family home. You can often times get into a property like this for as little as 3.5% down payment using the FHA loan program. The FHA even has programs that will allow you include “rehab” money into the loan so you can fix it up nice. Additionally, some banks allow you to use the income you’ll be receiving from rent to help you qualify for the loan.
More Money: Obviously, if you “buy smart” – your duplex can provide extra cash to help pay the mortgage, cover you during hard times, or even live for free. This is also an excellent way to pay down your mortgage faster (by applying the rent payment toward paying down your loan.)
Less Risk: One of the most significant benefits of having multiple units is the decreased risk you have of losing your home if something bad happens to your income situation. This benefit increases if you buy a triplex or a four-plex, as the risk is more diversified.
On the Job Training: If you are considering using real estate as part of your future investment strategy, a duplex that you live in can be a great way to learn how to effectively manage rental property. Being a landlord is not always fun, but 80% of the hassle can be eliminated by simply buying smart and managing effectively. Most “burned out” landlords I know became so by treating their rentals as a relaxed hobby rather than a business. By starting small, you will learn how to grow your investment portfolio in a smart, scalable way that won’t make you hate your life as an investor.
Jump Start for your Financial Future: Chances are you don’t want to live in a duplex for very long. However, your first home is seldom the home you stay in. By purchasing a duplex with a long term, fixed rate mortgage (the only type of mortgage you should ever get) you are able to control that property for the rest of your life. Because the property is your personal home, you get to take advantage of the incredibly low interest rates for your primary residence – which translates to low monthly payments that stay the same while rent climbs higher year after year. Purchasing a duplex can be an excellent jump-start to your retirement planning, even if that event is years away.

You Don’t Need To Be A Rock Star To Buy A Duplex

As I said before, owning property is not for everyone. However, making your first home a duplex (or other small multifamily property) can be extremely advantageous for you and your financial future. Not every duplex (or even most) are worth buying, but finding a good deal using math that makes sense is the key to success in real estate. I highly encourage you to take a look at some duplexes if you are itching to buy a home. It might be the difference between success and just wishing for a home. The “Cobain Duplex” is not my favorite investment property because of it’s unique history – it’s my favorite because of the financial helping hand this home gave me when starting out and continues to give me every month.

Have you considered buying a duplex? I’d love to hear your thoughts (positive or negative) on making a duplex your first property or any other real estate questions or comments you might have. Please leave me a comment below and let’s talk about it!

Brandon Turner is an active Real Estate Investor, Entrepreneur, World Traveler, Guitar Player, and Husband. He is located in Grays Harbor, Washington and enjoys finding killer Real Estate deals, leading worship at his local Calvary Chapel, bonfires on the beach, backpacking Europe, and speaking in third person. If you’d like to get a free copy of “7 Years to 7 Figure Wealth,” Brandon’s first eBook and personal manifesto regarding the quickest and most stable way to financial freedom through real estate, please visit his website at www.RealEstateInYourTwenties.com.

123 Shares

Source: biblemoneymatters.com

Apache is functioning normally

May 24, 2023 by Brett Tams

Half of Americans Won’t Be Able to Afford Their Standard of Living in Retirement: Here’s What You Can Do | SmartAsset.com

Close thin

Facebook

Twitter

Google plus

Linked in

Email

arrow-right-sm

arrow-right

Tap on the profile icon to edit
your financial details.

Will you have to downsize in your retirement?

Many families plan to adjust their lifestyles in retirement. They swap the family house, say, for a smaller home. Or they move to a less expensive community. When this is a choice, it can be an excellent way to slow down and stretch the value of your portfolio.

Unfortunately, for many households, downsizing won’t just be an option. It will be a necessity.

That’s the result of a recent study published by Boston College’s Center for Retirement Research. The CRR researches the many different financial and lifestyle issues that surround modern retirement and publishes a statistic called the National Retirement Risk Index. This index measures how many households have less in retirement savings than they will need in the years ahead.

For hands-on help planning your retirement, consider matching for free with a vetted financial advisor.

What the CRR Study Says

The CRR’s findings are stark. Fully half of the nation’s working-age households will not have enough money to maintain their standard of living once in retirement. Making matters worse, this study assumes a strong working and saving life in which people work until age 65 and annuitize their assets, and even accounts for Social Security income.

Instead, according to the CRR’s findings, millions of households will have to cut back on both luxuries and necessities in order to survive. The specifics will range based on the needs of any given individual. In some cases, retirees won’t be able to enjoy some of the same things that made them happy in their working years. They might have to go out for dinner less often, for example, or they may no longer be able to travel.

For other people the situation will get more dire. In order to survive, retirees will have to sell valued assets like a family home or may have to skip necessities like food and medication.

The National Retirement Risk Index is based on the concept of income replacement. Essentially, how effectively can the proceeds of a retirement portfolio replace working income? It isn’t a one-to-one relationship, because, once retired, most households need less money to maintain the same standard of living on a day-to-day basis. You no longer have to save for retirement, for example. You typically pay less in taxes, no longer have dependents to support, have paid off the mortgage on your house and in general have fewer costs. For many households, the rule of thumb is that your retirement portfolio needs to replace 80% of your working income in order to maintain the same standard of living.

Yet half of all households will fall short of even that 80% mark by at least 10 points, the level at which the NRRI considers a household “at risk.”

Underprepared For Retirement – A Wider Trend

This is the latest survey to emphasize what financial experts have been warning of for years: There is a retirement crisis brewing in America.

Around the late 1970s and the early 1980s, the economy shifted from what is called “defined benefit” retirement planning to “defined contribution.” Instead of receiving a guaranteed pension from their employers, most workers were enrolled in the now-common 401(k) plans. This has system has struggled to keep up with workers’ needs, however, and in the decades since there has been a growing concern that households simply have not been able to save up the money they will need to pay for retirement.

The National Retirement Risk Index has found this consistently to be the case. Since 2004, it has found that about half of households surveyed do not have the money they will need to maintain their standard of living in retirement.

Previously, older generations were less at risk, as in 2004 many older households still reflected the more generous retirement plans and pay scales of a previous era. In the most recent publication, however, that difference has been erased. Now the NRRI finds equal risk across all age groups. The center has also found this broadly true across most income groups as well. Even across high-income households (defined as $85,000/$248,000 or more for single/married households), 41% of all households surveyed fall below their own replacement level of savings.

As to what policymakers can do to address this crisis, there are many proposed solutions. Yet arguably two of the biggest issues when it comes to addressing retirement shortfalls are time and money.

From the perspective of time, effective solutions will differ across various households. Policymakers may be able to help younger households through a series of employer- and tax-based options, helping people to get more income and to save up more in their retirement accounts during their working lives. This can be an effective solution for someone who has decades of growth left ahead of them. However this problem is equally stark for households that are just a few years away from retirement, and they likely do not have the time to catch up through savings and investment. Households approaching retirement are likely to founder without a simple plan to get them more money.

Which is the other problem. Ultimately, the retirement crisis is about money. Households need more of it, and it will have to come from somewhere. Whether the government spends this money directly through Social Security overhauls or whether an employer does so by reintroducing pensions or boosting benefits and pay, this comes down to somebody, somewhere cutting a check. Finding those funds remains one of the biggest problems when it comes to solving the retirement crisis.

That solution needs to come soon, however, because the Boston College findings are quite clear. For millions of Americans, retirement will not be something to look forward to. It will be an era of struggle and want.

But this does not have to be your own experience.

Saving for retirement is a massive project that should last for your entire career. Ideally, you can begin setting aside money as early as possible. Even just a small amount of savings in your 20s can add up to a significant nest egg by the time you reach your 60’s. If you have children, you can do the same for them. Making modest contributions to a portfolio that can grow over 60 years will be one of the best ways you can help young children get a head start on life. But no matter what age you’re at, it’s never too soon or too late to start.

Beyond that, the rule of thumb is 10%. Whenever possible, set aside 10% of your salary into retirement savings. If you have an employer with a matching 401(k), maximize that, followed by Roth IRA and Roth 401(k) accounts.

Don’t just rely on rules of thumb though. Use tools like our retirement calculator to reverse engineer your savings plan. Start with a sense of how much money you will need in retirement, then work backwards to figure out how much you should be contributing in order to reach that goal. Even if the numbers are large, it’s better to have a clear plan than a best-guess approach.

Finally, if you do need to change your standard of living in retirement, begin planning for that early. Again, by understanding what you can contribute and how that can grow over time, you will have a sense of what’s possible from your retirement account. Make your plans from there. That will give you a degree of control over how you have to change your lifestyle, so that you’re making cuts that you’re comfortable with instead of scrambling to meet your needs as they arise.

Bottom Line

The Center for Retirement Research at Boston College released its latest National Retirement Risk Index, and its findings are grim. Fully half of all Americans will need to cut their standard of living in order to ever retire.

Retirement Tips

You’ve worked. You’ve saved. You have a portfolio that’s humming along. So, with all of that going for you, how can you know when you’re ready to retire?
But the best way to know how your retirement plan is to get professional help. A financial advisor can help you save and plan for retirement. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

Photo credit: ©iStock.com/Dean Mitchell, ©iStock.com/shapecharge

Eric Reed
Eric Reed is a freelance journalist who specializes in economics, policy and global issues, with substantial coverage of finance and personal finance. He has contributed to outlets including The Street, CNBC, Glassdoor and Consumer Reports. Eric’s work focuses on the human impact of abstract issues, emphasizing analytical journalism that helps readers more fully understand their world and their money. He has reported from more than a dozen countries, with datelines that include Sao Paolo, Brazil; Phnom Penh, Cambodia; and Athens, Greece. A former attorney, before becoming a journalist Eric worked in securities litigation and white collar criminal defense with a pro bono specialty in human trafficking issues. He graduated from the University of Michigan Law School and can be found any given Saturday in the fall cheering on his Wolverines.

About Our Retirement Expert

Have a question? Ask our Retirement expert.

Source: smartasset.com

Apache is functioning normally

May 24, 2023 by Brett Tams

Estimating your retirement expenses well in advance can help ensure retirement bliss is in your future.

January 27, 2023

How much progress are you making saving for retirement?

According to a Bankrate survey, 52 percent of American workers said they were behind on their retirement savings goals. Meanwhile, 20 percent said they didn’t know where their retirement plan stood.

If you’re worried about falling behind, you may be wondering, “How do I know how much money I will need in retirement?”

Estimating retirement expenses can help you find the answer. Even if you’re still decades away from retirement, you can make a retirement budget to hone in on a savings target.

“Creating a budget is important since most people have two income sources for retirement: Social Security and whatever they have saved,” says Derek Mazzarella, a financial advisor in Needham, Massachusetts. “Projecting how much you’ll spend is critically important to know if you have enough money saved and if it will last long enough.”

If you’re ready to dig into the numbers, use this plan to learn how to estimate your retirement expenses:

Use your current spending as a budgeting model

Data from the Bureau of Labor Statistics puts the average household spending for Americans aged 65 to 74 at $54,997 annually. Average annual spending drops to $41,849 for those 75 and older. While these types of figures can be helpful benchmarks, you can more accurately estimate your retirement expenses by calculating what you’re spending now.

When making a retirement budget, Mazzarella says it’s helpful to divvy up expenses into two categories: fixed and variable. Fixed expenses are those you pay every month, such as housing, utilities, groceries and debt payments. Variable expenses are costs that can fluctuate (think entertainment or medical costs).

Once you break down your current budget, you can start estimating retirement expenses by considering what costs may increase, decrease or disappear altogether when you retire, as well as those that will remain the same. Your budget for family expenses might shrink, for example, once your children are out of the house and financially independent.

On the other hand, you might see health care expenses increase as you get older. According to the Bureau of Labor Statistics, a person 65 years or older spends around $6,802 per year on healthcare, not including the cost of long-term care. Learning how to make a retirement budget that accounts for those expenses while you’re still young and healthy can keep you from coming up short later.

Be realistic about retirement income

Once you’re done estimating retirement expenses, think about the sources of your retirement income. The list might include your 401(k), IRA, an employer pension plan, Social Security or business income if you own a business or have a side hustle.

The Social Security Administration offers a calculator that can help you determine your estimated benefits and make a retirement budget. You can also use an online retirement income calculator to estimate how much income your savings will generate once you retire. From there, you can create a plan for drawing down assets from different savings vehicles.

“In many cases, simply taking a proportionate amount of income from each type of account you own gets the job done,” says Byron W. Ellis, CFP^®.

Choose your term, lock in your rate, and watch your CD grow

Discover Bank, Member FDIC

Let’s say you hold 60 percent of your savings in an IRA and the remaining 40 percent in high-yield savings vehicles. Ellis says you could plan to follow that same 60/40 split for income as you make a retirement budget. Sixty percent of the income you need to meet your retirement expenses would come from your IRA, in this scenario, while the rest would come from those high-yield savings accounts.

Remember that with a traditional 401(k) or IRA, you’re generally required to begin making withdrawals once you reach age 70 1/2 if you attained that age prior to 12/31/2019 and age 72 after 12/31/2019. That can affect your yearly retirement income total.

“The amount required is based on how much is in the IRA and how old you are, so the larger the account balance and the older you get, the more you have to distribute,” Ellis says.

Consider your lifestyle goals and plan for emergencies

As you learn how to estimate your retirement expenses, consider what kind of lifestyle you plan to enjoy when you retire.

“It’s common for new retirees to spend more earlier on in retirement” since they tend to be the most active, says Mazzarella, the financial advisor. That can be especially true during the first two years of retirement.

Health care has already been mentioned as a budget buster, but spending more time traveling, taking up a new hobby or buying a vacation home should also be top-of-mind when determining how to estimate your retirement expenses.

While new experiences and adventures should be considered when estimating retirement expenses, you’ll also need to factor in unexpected expenses. Having an emergency fund of easily accessible cash can keep you from having to tap your retirement accounts to pay for something like a home repair or a medical bill. Mazzarella says to keep three to six months’ worth of expenses in emergency savings for retirement.

Time is on your side

Learning how to estimate your retirement expenses can help you figure out what you’ll need income-wise, but that will only get you so far. You still need to act to ensure you’re saving enough. Thanks to compound interest—when your interest starts earning interest of its own—the sooner you can start saving for retirement, the better.

If you’re not putting money into an employer-provided 401(k) plan or an IRA, make enrolling and setting up contributions your top priority. If you are enrolled in a company-provided plan, check your current contribution rate to see if you’re saving at least enough to get the company match.

Consider signing up for an automatic annual contribution rate increase if your plan offers that feature. Bumping up your savings by even 1 percent annually could make a significant difference in how much you’re able to save over the long run.

Finally, consider your various options when it comes to IRA accounts. For example, the Discover IRA CD offers guaranteed returns at fixed terms. The Discover IRA Savings Account allows for flexible contributions and withdrawals, and it provides a place for you to transfer your maturing IRA CD without locking in a fixed term. Keep in mind that there may be an IRS early withdrawal penalty depending on your plan type and the age at which you withdraw your funds. Consider consulting a tax advisor to discuss your specific situation.

Both of these accounts can help you add even more money to your retirement savings by locking in a competitive interest rate and allowing you to enjoy tax benefits along the way.

Articles may contain information from third-parties. The inclusion of such information does not imply an affiliation with the bank or bank sponsorship, endorsement, or verification regarding the third-party or information.

Source: discover.com

Apache is functioning normally

May 24, 2023 by Brett Tams

.kb-table-of-content-nav.kb-table-of-content-id_88a319-9a .kb-table-of-content-wrappadding:23px 23px 23px 23px;background-color:#f9fafa;border-color:#cacaca;border-width:1px 1px 1px 1px;.kb-table-of-content-nav.kb-table-of-content-id_88a319-9a .kb-table-of-contents-titlefont-size:14px;line-height:18px;letter-spacing:0.06px;font-family:-apple-system,BlinkMacSystemFont,”Segoe UI”,Roboto,Oxygen-Sans,Ubuntu,Cantarell,”Helvetica Neue”,sans-serif, “Apple Color Emoji”, “Segoe UI Emoji”, “Segoe UI Symbol”;font-weight:700;text-transform:uppercase;.kb-table-of-content-nav.kb-table-of-content-id_88a319-9a .kb-table-of-content-wrap .kb-table-of-content-listcolor:#001c29;font-size:14px;line-height:21px;letter-spacing:0.01px;font-family:-apple-system,BlinkMacSystemFont,”Segoe UI”,Roboto,Oxygen-Sans,Ubuntu,Cantarell,”Helvetica Neue”,sans-serif, “Apple Color Emoji”, “Segoe UI Emoji”, “Segoe UI Symbol”;font-weight:inherit;.kb-table-of-content-nav.kb-table-of-content-id_88a319-9a .kb-table-of-content-wrap .kb-table-of-content-list .kb-table-of-contents__entry:hovercolor:#16928d;.kb-table-of-content-nav.kb-table-of-content-id_88a319-9a .kb-table-of-content-list limargin-bottom:7px;.kb-table-of-content-nav.kb-table-of-content-id_88a319-9a .kb-table-of-content-list li .kb-table-of-contents-list-submargin-top:7px;.kb-table-of-content-nav.kb-table-of-content-id_88a319-9a .kb-toggle-icon-style-basiccircle .kb-table-of-contents-icon-trigger:after, .kb-table-of-content-nav.kb-table-of-content-id_88a319-9a .kb-toggle-icon-style-basiccircle .kb-table-of-contents-icon-trigger:before, .kb-table-of-content-nav.kb-table-of-content-id_88a319-9a .kb-toggle-icon-style-arrowcircle .kb-table-of-contents-icon-trigger:after, .kb-table-of-content-nav.kb-table-of-content-id_88a319-9a .kb-toggle-icon-style-arrowcircle .kb-table-of-contents-icon-trigger:before, .kb-table-of-content-nav.kb-table-of-content-id_88a319-9a .kb-toggle-icon-style-xclosecircle .kb-table-of-contents-icon-trigger:after, .kb-table-of-content-nav.kb-table-of-content-id_88a319-9a .kb-toggle-icon-style-xclosecircle .kb-table-of-contents-icon-trigger:beforebackground-color:#f9fafa;

No financial institution can be all things to all people, but some come pretty close.

BMO Harris Bank is one of those banks. It’s a full-service bank with hundreds of branches in the United States (mainly in the Midwest and Southwest) and thousands of fee-free ATMs. With a comprehensive array of checking and savings accounts, plus credit cards, auto loans, and more, BMO Harris Bank is about as close as a bank can come to being a one-stop shop.

Does that mean BMO Harris Bank is right for you? Not necessarily. Plenty of other high-quality banks vie for your deposits every day. See whether BMO is the best fit — or whether you should see what else is out there instead.

What Is BMO Harris Bank?

BMO Harris Bank N.A. is an American bank that provides consumer and business banking services online and through a network of physical branches. Eligible deposits with the bank are FDIC-insured up to statutory limits set by Congress.

Its deposit accounts include checking, savings, money market, and certificates of deposit (CDs), and it also offers credit products like credit cards, mortgages, auto loans, personal loans, and private student loans. BMO Harris Bank has a wealth management division that focuses on relatively high net worth individuals and families, but no self-directed brokerage platform.

Is BMO Harris Bank a good place to park your cash, borrow money, and invest for the future? I’ve reviewed dozens of online banks and brick-and-mortar financial institutions over the years, and I believe BMO Harris Bank is in the upper echelon of the brick-and-mortar group. In other words, it’s one of the best traditional banks to work with — in part because it has embraced technology and innovation in a way that many of its competitors haven’t.

How BMO Harris Bank Stacks Up

BMO Harris Bank is a full-service financial institution that consistently ranks among the top traditional banks for U.S.-based consumers.

It competes not only with other big banks like Chase Bank and Citibank but with major online banks as well. If you’re torn between an “innovative incumbent” like BMO Harris Bank and an “established upstart” like Ally Bank, see for yourself how the two compare.

	BMO Harris Bank	Ally Bank
Monthly Maintenance Fees for Checking	None on the BMO Harris Smart Advantage™ Account	None
Savings Account Yields	Relatively low	3.60% APY
CD Yields	Up to 4.50% APY	Up to 4.25% APY
Credit Products	Credit cards, mortgages, credit-builder loans, home equity products, personal loans, auto loans, private student loans	Credit cards, mortgages, home equity products, auto loans
Self-Directed Brokerage	No, managed investments only	Yes
Physical Branches	Yes, in Illinois, Arizona, Wisconsin, Indiana, Florida, Missouri, Kansas, and some other states	No

What Sets BMO Harris Bank Apart?

Where does BMO Harris Bank get its edge? Out of all the bank’s advantages and selling points, three things really stand out:

A Checking Account With No Monthly Maintenance Fee, Period. The BMO Harris Smart Advantage™ Account is a truly free checking account. It doesn’t charge a monthly maintenance fee, period, regardless of balance or relationship status with BMO, yet it’s packed with features. It’s rare to find an account like this at a big bank.
One-Stop Shop for Credit. Even Ally Bank, probably the best online bank for borrowers, doesn’t bother with certain credit products. BMO Harris Bank has a comprehensive lineup of loans and lines of credit, from home and auto loans to personal and student loans.
Excellent CD Rates (For a Traditional Bank). BMO Harris Bank’s CD rates are competitive with the top online banks for CD customers. And they blow most traditional banks’ CD rates out of the water.

Key Features of BMO Harris Bank

BMO Harris Bank has a comprehensive lineup of deposit accounts and loans, plus some nice value-adds like account opening bonuses and a handy digital app. See what to expect from its products and how to determine which, if any, are right for you.

Account Opening Bonus Opportunities

BMO Harris Bank has some fantastic new account opening bonus opportunities for new checking customers.

BMO Harris Premier^TM Account — $350 Cash Bonus

This one is best for higher-income folks who have no problem meeting the direct deposit requirement. Here’s how it works:

Open a new BMO Harris PremierTM Account by July 14, 2023, and receive a total of at least $7,500 in qualifying direct deposits during the first 90 days of account opening. If you do, you’ll get a $350 cash bonus in your account.

This new checking account offer is not available for current BMO Harris personal checking customers, nor to customers who closed a personal checking account within the past 12 months. Open on-line or in branch; accounts subject to approval.

BMO Harris Smart Advantage^TM or BMO Harris Smart Money^TM Account — $200 Cash Bonus

If you can’t notch $7,500 in qualifying direct deposits during the first 90 days, this bonus could be right for you. It’s nearly as generous:

Open a new BMO Harris Smart AdvantageTM or Smart MoneyTM Account by July 14, 2023, and receive a total of $4,000 in qualifying direct deposits within 90 days of account opening. Do this and you’ll get a $200 cash bonus in your account.

The same restrictions apply to this offer — you must be a new BMO Harris personal checking customer and can’t have had a BMO Harris personal checking account within the past 12 months.

Checking Accounts

BMO Harris Bank offers three consumer checking accounts, each with its own clear use case. All offer access to in-branch and online banking, plus low- or no-fee transactions at more than 40,000 in-network ATMs:

BMO Harris Smart Advantage™ Account: With no monthly maintenance fee, this account is ideal for folks with modest incomes and low-ish balances — folks who wouldn’t be able to avoid monthly maintenance fees at most big competitor banks.
BMO Harris Smart Money^TM Account: Is a $5 monthly maintenance fee worth it for no overdraft fees, ever? If you occasionally dip into the red, probably yes. And there’s no maintenance fee if you’re under age 25, making this a solid student checking account.
BMO Harris Premier™ Account: BMO’s fanciest checking account entitles you to relationship benefits like up to $25 in monthly out-of-network ATM fee reimbursement and 0.50% off your home equity line’s interest rate. Benefits increase with your total BMO deposit balance.

Like all banks, BMO charges some account fees beyond the headline monthly maintenance fees (where present). Here’s how the Smart Advantage Account’s fee schedule looks:

Fee Type	Fee Amount
Monthly Maintenance Fee	$0
Allpoint and BMO Harris ATM transactions	$0
Non-BMO ATM transactions	$0
Paper statements	$2, but $0 when you opt into paperless
Check images	$3, but $0 when you opt into paperless
Overdraft fee	$15, but $0 when you opt into overdraft services
Minimum opening deposit	$25

Savings Builder Account

The Savings Builder Account is BMO Harris Bank’s standard savings account. There’s a $25 minimum opening deposit and no monthly maintenance fee.

Savings Builder’s defining feature is a $5 reward for each month you save at least $200 during the first year. Save $200 per month for all 12 months of the first year from account opening and you’ll clear a cool $60 in extra cash.

Moving forward, the Savings Builder Account has a negligible yield — just 0.01% APY. First-year deposit bonus aside, it’s not suitable if you’re looking for a high-yield savings account. On the bright side, it doesn’t have the usual savings account transaction limit. You’re free to make as many withdrawals as you like without incurring a penalty.

Money Market Account

BMO Harris Bank’s money market account has a higher yield than the Savings Builder Account. However, the yield requires a paired Premier checking account, and your actual return depends on how much you have on deposit across all BMO accounts.

To get the best rates — 2.00% higher than the baseline — you need at least $250,000 in deposits with BMO. And you need at least $10,000 in the money market account to avoid the $10 monthly maintenance fee.

Needless to say, this one’s better if you have a lot of cash on hand.

Certificates of Deposit

BMO Harris Bank offers standard CDs with terms ranging from three months to 60 months (five years). All require a minimum opening deposit of $1,000 and charge interest penalties if you withdraw principal before maturity.

BMO’s standard CD rates are not competitive. The longer-term products earn less than 0.50%, compared with 4.00% APY or higher at the best online banks for CDs.

BMO does offer CDs with competitive rates though. These special CDs, as they’re known, earn upwards of 4.00% APY on terms ranging from 13 to 59 months. They require a minimum deposit of $5,000, but if you can swing that, they’re well worth it.

You can structure select CDs as individual retirement accounts (IRAs) and enjoy tax-deferred or tax-free growth.

Individual Health Savings Account

BMO Harris Bank is one of relatively few banks that offer direct-to-consumer health savings accounts (HSAs). If you’re enrolled in an individual or family high-deductible health plan (HDHP) not through your employer, a BMO Harris Bank HSA can help you save for planned and unplanned medical expenses — or save for retirement if you stay healthy.

BMO’s HSA is delivered by Lively, a leading provider of individual HSAs. There are no ongoing or hidden service fees or monthly fees — you pay nothing out of pocket for the account — and you can withdraw money at any time to cover eligible health care expenses without paying taxes. Your contributions may be tax-deductible as well.

Credit Cards

BMO Harris Bank has four consumer credit cards, although its lineup has changed in the past and could in the future:

BMO Harris Bank Platinum Rewards Mastercard®. Earn 2 points per $1 spent on eligible gas and groceries, up to $2,500 in combined purchases each calendar quarter. Plus, get 10% bonus points on your cardmember anniversary each year (based on prior-year spending) and 0% introductory APR on balance transfers for 12 months from date of first transfer (must be completed within 90 days from date of account opening).
BMO Harris Bank Premium Rewards Mastercard®. Earn 3 points per $1 spent on eligible dining, hotels, and airfare, up to $2,500 in combined spend each calendar quarter, plus 15% bonus points on your anniversary. The same first-year balance transfer promotion applies, but there’s a $79 annual fee after the first year.
BMO Harris Bank Cash Back Mastercard®. Get 5% cash back on eligible streaming and cable/satellite TV purchases and 3% cash back on eligible gas and grocery purchases, up to $2,500 in combined spend per calendar quarter. Plus, get up to $400 in cellphone protection (restrictions apply) and the same first-year balance transfer deal.
BMO Harris Bank Platinum Mastercard®. If you need to finance a major purchase, this is your card. Enjoy 0% APR for 15 months from account opening on purchases and balance transfers.

Loans and Lines of Credit

BMO Harris Bank offers a full lineup of loans and lines of credit:

Mortgage loans, including fixed-rate and variable-rate conventional loans, jumbo loans, and specialty loans like VA and FHA mortgages
Home equity products, including home equity loans and lines of credit
Specialty property loans for bank-owned properties — BMO is one of the few banks that connects consumers with distressed property opportunities
Unsecured personal loans and lines of credit
Savings secured loans — borrow against your savings balance
Credit-builder loans — ideal for people just beginning their credit journeys
Auto loans
Private student loans and student loan refinancing

Premier customers may qualify for rate discounts and other benefits on select loan products.

Wealth Management Services

BMO Harris Bank has a team of in-house wealth advisors who offer financial planning and investment management services customized to your needs. One thing to note here: BMO doesn’t have a self-directed brokerage, so if you prefer to manage your own funds, you’ll need to look elsewhere.

Mobile Banking App

The BMO Harris mobile banking app is compatible with Android and iOS devices. It’s capable of handling most everyday banking functions, including online bill pay, money transfers, and statement review.

Advantages of BMO Harris Bank

BMO Harris Bank has a lot going for it. These are its most notable advantages.

Actually Has a Free Checking Account With No Minimum Balance. BMO Harris Bank is one of the few big banks that has a truly free checking account: the Smart Advantage Account. Most competitors require you to jump through some sort of hoops to avoid a monthly fee or impose age-based restrictions you can’t avoid.
Offers a Health Savings Account for Individuals. BMO Harris Bank’s individual HSA is another rarity among big banks. And it’s backed by Lively, a leader in the HSA space.
Built-in Free Overdraft Protection With Smart Money. BMO’s Smart Money Account doesn’t charge for overdrafts, period. Call it complimentary overdraft protection — it’s a big deal if you sometimes cut it close.
Impressive Range of Deposit Accounts and Loans. BMO Harris has three checking accounts, several savings products, and just about every major type of consumer loan you can imagine. It’s a one-stop shop for consumer financial products and services.
Competitive Rates on Special CDs. If you can meet the $5,000 minimum balance requirement, BMO’s special CDs are a great deal. Yields range from 2.00% to 3.00% annual percentage yield and appear responsive to changes in benchmark interest rates.

Disadvantages of BMO Harris Bank

Consider these potential drawbacks before opening an account with BMO Harris Bank.

Poor Savings Account Yields. BMO’s Savings Builder Account has a very poor yield. It’s not even worth talking about, frankly — if you’re in the market for a high-yield savings account, look elsewhere.
Standard CD Rates Aren’t Competitive. BMO’s standard CD rates aren’t competitive either. Fortunately, as long as the special CDs are available, you don’t have to bother with them.
Special CDs Have High Minimum Balance Requirements. BMO’s special CDs have high minimum balance requirements ($5,000). If that’s tough for you to swing, you may need to look elsewhere for competitive CDs.
Premier Benefits Have High Balance Requirements. BMO’s Premier relationship tiers offer lots of potentially valuable perks and benefits, but you have to hold up your end of the bargain by bringing tens of thousands of dollars to the table. The juiciest perks are reserved for people with at least $250,000 in eligible BMO accounts.

Is BMO Harris Bank Legit?

Yes, BMO Harris Bank is legit. It’s the eighth largest bank in North America by assets and serves more than 12 million customers on both sides of the U.S.-Canada border. It has been in business for nearly 200 years and has paid dividends to shareholders for virtually all of that time — dividends that have steadily increased over the decades.

For U.S.-based customers, BMO Harris Bank is a Member FDIC institution, which means eligible deposits are insured up to statutory limits by the Federal Deposit Insurance Corporation. When you open a checking, savings, money market, or CD account with BMO Harris, you can rest assured that your money is backed by the full faith and credit of the U.S. government — up to $250,000 per account type.

Final Word

BMO Harris Bank is a full-service financial institution that has been in business for hundreds of years and serves millions of customers in the U.S. and Canada. It’s accessible through a network of physical branches (mostly in the Midwest and Southwest), through thousands of in-network ATMs, and online and through the BMO Harris Bank mobile app from anywhere.

BMO Harris Bank stands out for several reasons. It has one of the best no-maintenance-fee checking accounts of any big bank. It offers a comprehensive lineup of savings products, although its actual savings accounts don’t have competitive yields. And it’s basically a one-stop shop for consumer credit, from credit cards and auto loans to mortgages and education financing.

If you’re in the market for a new bank, I’d encourage you to give BMO Harris Bank serious consideration. It’s not perfect, to be sure, but it’s better than most.

Editorial Note:
The editorial content on this page is not provided by any bank, credit card issuer, airline, or hotel chain, and has not been reviewed, approved, or otherwise endorsed by any of these entities. Opinions expressed here are the author’s alone, not those of the bank, credit card issuer, airline, or hotel chain, and have not been reviewed, approved, or otherwise endorsed by any of these entities.

Brian Martucci writes about credit cards, banking, insurance, travel, and more. When he’s not investigating time- and money-saving strategies for Money Crashers readers, you can find him exploring his favorite trails or sampling a new cuisine. Reach him on Twitter @Brian_Martucci.

Source: moneycrashers.com

Apache is functioning normally

May 24, 2023 by Brett Tams

The thought of investing–and doing it successfully–can be a daunting task. This is especially true if you’re a beginner investor. However, if you’re willing to take advantage of the information on the best investment sites, you’ll have a wealth of investment knowledge right at your fingertips.

The top investment sites for stock news, research, and analysis can be great tools for keeping you up to date on the latest financial and economic news. As you learn more from each site, you’ll have more knowledge with which to plan your own personal investment strategy.

Of course, they’re just opinions, but they are educated opinions. Whether you’re a beginner investor or a seasoned investor, these sites have information you should check out.

Our Top Picks For Investment Sites

Motley Fool – Great For Beginner Investor & Get $100 off

Morningstar – Great For DIY Investors & 14 Day Free Trial

Market Watch – Great For Up to Date Investment News

In This Article

What Are the Top Investment Sites?

Even the best investment sites aren’t guaranteed to pick stock winners and losers. However, the people who are hired to write on the sites typically have a wealth of experience and education behind them.

There are a few investment sites that people “in the know” use when they want information about companies and other economic news. Here are some of our favorite investment sites for garnering important economic information.

Here’s a list of some of our favorite investment sites for learning what you need to know about investing and company financial information.

1 .Motley Fool Stock Advisor

Motley Fool was founded in 1993 by David and Tom Gardner, brothers. Their goal? “Make the world smarter, happier, and richer.” Sounds good to me.

The Motley Fool brothers are big believers in buying stock in great companies and holding onto it. Their site has a great section on investing for beginners.

It also shares a wealth of information on the stock market, on investing for retirement and more. The site even shares personal finance information such as where to find the best checking accounts and credit cards.

Personally, I find the site very well put together and easy to use too. I’d happily use this site (and do) whether I was just starting out as an investor or knew most everything I thought I needed to know.

Motley Fool Stock Advisor: Join for just $99 a year!

Best for: Those looking for comprehensive information on individual stock purchases

2. Morningstar

Morningstar’s tagline is “Empowering investor success.” The site stays true to its investment philosophy of putting investors first. That means they won’t give you investment advice based off of an affiliate relationship.

Instead, they share what they believe to be the best guidance for investors. Morningstar is probably best known for the ratings it publishes on varying investments.

If you want access to Morningstar ratings and detailed investment analysis, you’ll have to sign up for their premium account, which costs $199 per year. However, the site does have an endless number of free informational articles talking about all things investment-related.

Best for: Both beginner and seasoned investors who want detailed information

3. MarketWatch

MarketWatch is another top-rated investment site. It’s a good site for keeping up to day with the latest investment and economic information.

The site shares global information for most all stock markets, commodities markets, forex markets and more. The Moneyist (the Dear Abby of personal finance and investing) is a personal favorite for me.

He answers questions ranging from “Do I have enough to retire?” to “My brother won’t give me my share of our father’s inheritance. What do I do?” and more.

You can also find personal finance information on the site. MarketWatch is full of useful information, easy on the eyes and a pleasing website to navigate.

The site also shares valuable news articles from around the web, whether it be auto reviews or best retirement spots.

Best for: Anyone who wants to find up-to-date investment and other financial information quickly and easily.

4. Barron’s

Barron’s is an investment site for the serious investor. This site is formatted most like the newspapers of old. Clear and concise, Barron’s shares market information along with its favorite current stock picks.

The site’s e-magazine contains articles about popular publicly traded companies’ ups and downs. And the site’s e-advisor keeps you up to date on it’s favorite investment moves.

The articles and information are written smartly and simply. However, they assume you’ve got a solid basic understanding on investing and economics as a whole. While Barron’s is a phenomenal site for seasoned investors, beginner investors might want to stick with one of the other sites mentioned here.

Best for: The seasoned investor who wants a wide span of information on current economics and company performance.

5. Wall Street Journal

I clearly remember seeing my grandfather and his friends perusing over the Wall Street Journal in the early 90’s as they shared breakfast together at the local greasy spoon.

My family and I would eat there on occasion, but we never interrupted the group other than to say “hi” to grandpa and give him a quick hug. Yep, this group of wealthy men would never spend more than $10 for breakfast, but they all had the money to buy the cafe’ if it ever went up for sale.

Thank you, Wall Street Journal. For as long as I can remember, the Wall Street Journal has been the go-to source for those seeking investment advice. It’s changed with the times but still stayed the same, keeping its “real” paper but managing a well-put-together website too.

Wall Street Journal covers everything regarding economic markets in the U.S. and the world. And it tosses in some articles on politics, tech, and current events as well.

The online website headlines are free, but if you want complete information you’ll have to pay for the digital editions, print editions, or both. The good news is that WSJ is affordable at no more than $20 per month. Therefore, we love it as one of the best investment sites.

Best for: Investors that want to get the scoop on the markets and the rest of the world’s happenings, as well as those craving that great feeling of holding a printed newspaper in their hands.

6. Zacks

Zacks is an investment website that’s committed to independent research analysis. The Zacks “About” page says their strategy has beat the S&P market by quite a length (over double) for the past 25+ years.

Of course, past performance is not a guaranteed indicator of future results, but it sure does tell you a thing or two. Namely that the group at Zacks knows their stuff when it comes to investing.

While the site provides a wealth (no pun intended) of free information, you’ll have to pay to get the inside scoop on the Zacks investment strategy. That includes the Zacks #1 rank list of 220 of the best stocks.

They offer a 30-day free trial. After that, you’ll pay $249 a year to continue getting access to Zacks’ investment secrets.

Bonus: Zacks links to the best articles from popular sites such as MarketWatch too.

Best for: The serious investor who’s willing to take the time to learn about in-depth investing.

7. Seeking Alpha

Seeking Alpha does a great job of delving deeper into the “whys” behind investing in a particular stock or fund. While this is a terrific feature for experienced investors, beginner investors may find the information a bit lofty.

Seeking Alpha is part investment news source and part investing community. Articles are written by investor members and then rigorously scrutinized to ensure accurate information.

With over 7,000 members, there’s no shortage of investing information and opinions. The site is great for those who want to do some in-depth research on markets, stocks, and investments.

The Basic Seeking Alpha site is free. However, the site also offers a Premium membership for $240 annually and a Pro membership for roughly $2400 annually.

Think of the Premium membership as a self-directed site and the Pro membership as a full-service site. See the website for more detailed information on what you get with the upgraded memberships.

Best for: Intermediate and advanced investors looking for community support and advice

8. The Financial Times

The Financial Times (or FT as it’s often called) focuses primarily on stocks, funds, and stock news. But you’ll also find tech information, personal finance articles, and more. In-depth information on company performance rounds out the offerings.

The site has a nice collection of charts and graphics too. There are some free articles on Financial Times, but as with Wall Street Journal you’ll have to pay if you want full access.

Like Zacks, Financial Times is a bit on the spendy side if you’re not used to paying for investment information. Digital access is $39.50 per month or $369.20 per year. The print access subscription includes digital access and costs $199 per year.

You can pay $1 and get a 4-week trial if you’d like to sample Financial Times. And there are other subscription options as well.

Best for: Investors looking for a melting pot of investment and economic news, information, and opinion

9. CNBC

CNBC is a popular news channel with a focus on investment and economic news. While you can get CNBC regularly with many paid TV subscriptions, you can also access the company’s many articles for free on their website.

Current market numbers are conveniently displayed throughout the site. And you’ll find articles on investing, technology, business, politics, and more.

Under the “Investing” tab, you’ll find “Invest in You” and “Personal Finance” sections that have a wealth of articles aimed at making personal finance more, well, personal. These sections show you how to put the site’s advice into action and better your personal money situation.

If you want access to CNBC’s “PRO” content, however, you’ll have to buy a subscription. CNBC PRO gives you access to live programming, exclusive video series, and more.

It costs $29.99 per month to subscribe to CNBC PRO, or you can pay $299.00 annually. There is a 7-day trial period you can use to check it out.

Best for: those wanting a quick glance at the world’s most up-to-date economic information

10. Kiplinger

Kiplinger was started in the 1920’s by a former AP economic reporter. The Kiplinger Letter, the company’s weekly economic publication, is considered the most widely read business forecasting publication in the world, according to the Kiplinger website.

Kiplinger also has a monthly magazine. The Kiplinger website gives access to The Kiplinger Letter if you’re a member. You can find a wealth of free information on the site, including investment information. The site also shares informational articles on:

Retirement
Taxes
Wealth creation
Personal finance

And more. However, if you want the goodies like the print magazine and/or complete access to all website information, you’ll have to subscribe.

As of this writing, you can get access to print subscriptions, digital access, or both for $29.95 for 12 months or $39.90 for 24 months. But I think you might find it well worth the price.

One thing I really like about the Kiplinger site is that many of the articles are written in a way even the most beginner personal finance/investment aficionado can understand. The site has a great mix of both beginner and experienced investor articles and information.

Best for: Beginner and experienced investors who want print news and digital news

11. Stock Rover

Stock Rover makes our list of best investment sites because of its mission to help all levels of investors make informed decisions. The Stock Rover website works to provide affordable, comprehensive research to help investors learn before they invest.

The site can help you compare companies or investments, research reports, and manage your portfolio. Stock Rover’s blog includes investing articles, stock research articles, and other valuable information.

For instance, you can learn how to build a better stock portfolio. Of course, these features don’t come for free–at least not all of them. Stock Rover has four plans you can choose from, one of which is free.

While the “free” plan does provide a lot of information and articles, the paid plans provide other valuable tools. The Essentials, Premium, and Premium Plus plans range in price from $7.99 per month to $27.99 per month.

Watchlists, screens, and the number of portfolios you can manage go up with each plan. You can get additional information via other subscriptions on Stock Rover too, such as research reports plans and bundles.

Best for: People who want more of a personal touch as they invest

12. AAII

AAII, or the American Association of Individual Investors, is a non-profit organization aimed at helping people learn about investing and grow their investment portfolios. They’ve been in business for over 40 years.

The organization uses education, information, and research to help members learn about investing and manage their investments. Along with the AAII website, you may have a local chapter that meets in person in your area.

AAII has two membership options. The Basic membership is $1 for the first 30 days and then $3.25 a month going forward. You get access to the AAII market-beating portfolio, investor guides, and other information.

The Plus membership is $2 for the first 30 days and then $15.67 per month going forward. It includes additional benefits such as stock and fund evaluators and graders, and detailed portfolio analysis and alerts.

Both membership options include free access to the local chapters of AAII. In addition, you get access to the award-winning AAII Journal in digital format, print format, or both.

Best for: Those looking for investment guidance with a heart

13. Yahoo Finance

Yahoo Finance, albeit basic, is a good at-a-glance option for investment information. The site shares market numbers along with investment and economic news articles from around the web.

You’ll find links to articles from Reuters, MarketWatch, Investopedia and other well known sites. Yahoo Finance also has their own penned articles on the site. It’s a good one stop shop for economic news.

Best for: Those wanting access to current investment and economic news from a variety of sources

14. Investopedia

Last but certainly not least, we like Investopedia as one of the best investment sites for investment news. What started out as sort of a Wikipedia with a money/investing focus has morphed into a great resource for investing and economic news and information.

Along with current investment news, you can check out Investopedia’s stock simulator. And Investopedia Academy features paid online courses to help you learn everything you want to learn about investing.

The articles cover every type of investor from the beginner to the day trader. And while the courses do cost money, most of the basic information on Investopedia is free.

Best for: Those interested in an education-based investment site

Summary

With the plush selection of the best investment sites out there, there’s no reason you can’t stay up to date on current investment news. And there’s no reason that even the most beginner of investors can’t learn how to invest smartly and successfully.

There are investment sites out there for the knowledge levels and learning preferences of just about everyone on earth.

Laurie is personal finance writer and a licensed Realtor. Her goal in blogging is to help others find their way to financial freedom, and to a simpler, more peaceful life.

Source: debtdiscipline.com

Apache is functioning normally

May 24, 2023 by Brett Tams

One of the keys when it comes to investing for the long term is to make sure you’re minimizing the fees you’re paying to invest your money.

Whether it’s plan administration fees for the company you’re investing with, mutual fund expense ratios and fees, or fees for added account functionality, the more you can minimize how much you’re paying, the better.

Morningstar reports that the average expense ratio for actively-managed equity mutual funds is 1.2% and investment-grade bond funds have an expense ratio of 0.9%. For me, I prefer to invest in mainly low-cost index funds with expense ratios that are much lower.

Beyond saving money on the expense ratios, I also would love to save money on the administration fees I pay in order to invest. My company 401(k) has fees just under 1%, which is way too much for my tastes. I’ve stopped investing there first since there is no company match.

This past week I was doing some research on the new slate of robo advisors that have popped up. One of them jumped out at me because the company is extremely affordable, but it also has shown some of the best results in the past couple of years. Not only do they invest your money for you in a slate of well-diversified ETF index funds, and rebalance your holdings on a regular basis, but they charge you a pretty minimal fee to do it.

This all sounded too good to be true, so I decided to do a full review of this new automated investing service called Axos Invest Managed Portfolios, to see what they are all about.

Axos Invest History

Axos Invest launched several years ago under the name WiseBanyan. They had the goal of being the world’s first completely free financial advisor.

Here’s their reasoning behind why they launched their site.

Herbert Moore and Vicki Zhou founded WiseBanyan after seeing that the incentives between financial advisors and clients were often misaligned. They saw this firsthand while working in asset management and investment banking respectively, and later as colleagues at a quantitative asset management firm. They realized that the main cause of misalignment was a conflict of financial interests, which often resulted in high fees, unnecessary tax consequences, and unreasonable account minimums for the clients. As a result, they set out to build a company that was not incentivized to earn money at its clients’ expense.

WiseBanyan began with the idea that investing is a right – not a privilege. Our mission is to ensure everyone can achieve their financial goals, which starts with investing as early as possible. This is why there is no minimum to start and we do not charge high fees. We hope you are as excited about WiseBanyan as we are, especially what it means for you, your friends, and society as a whole.

Axos Invest was launched with the hope of making investing easy, accessible, and cheap – even for beginning investors who could only invest a small amount every month.

While the service is no longer free (They started charging a 0.24% annual assets under management fee in 2020), they still practice the values of making investing more accessible and affordable for everyone.

WiseBanyan Holdings was acquired by Axos Financial, and as of October 2019 and moving forward the company formerly known as WiseBanyan is now known as Axos Invest.

Axos Invest has become a part of the Axos Financial online banking platform. Check out our full review of Axos Bank.

Axos Invest Account Types – Managed Portfolios Vs. Self-Directed Trading

After reading up a bit about Axos Invest I was intrigued enough to sign up for one of their accounts. I went to their site to find that there are a couple of different account types you can sign up for.

I was mainly interested in signing up for Managed Portfolios since I intended to use this as a robo-advisor to automatically invest, rebalance and reinvest my dividends for me. I wanted it to be hands-off.

If you prefer to research and invest in your own choices of individual stocks, the commission-free Self Directed Trading account may be a better choice for you.

If you’re an advanced trader the Self Directed Trading account has the “Axos Elite” subscription which gives you real-time market data, TipRanks market research, extended trading hours, margin trading, stock lending, and more for a monthly fee.

Head on over to the Axos site via my exclusive invite link below to get started on your Axos Invest account now:

Open Your FREE Axos Invest Account Now

Open an Axos Self Directed Trading account and deposit at least $2000, and you’ll get a $250 bonus for a limited time!. Open Axos Self Directed Trading

Opening An Account With Axos Invest

After going to the Axos Invest site to open my Managed Portfolios account, it dropped me right into a brief questionnaire to assess my risk tolerance, investment time horizon, and more.

While you’re answering the questions you’ll see a progress bar and a “current risk score” listed to the right, telling you just how conservative or aggressive Axos Invest believes you are.

My risk score went up and down throughout the survey based on my answers, and when I finally completed it gave me a risk score of 7.2. That would give me an estimated asset allocation of 65% stocks to 35% bonds – which seems about what most would suggest as I’m relatively conservative in my investments, and the bond allocation roughly matches my age (put your age in bonds!)

I decided that I wanted to change my risk score and asset allocation to be a bit more aggressive, however, and you can do that simply by moving the slider to the right (or left if you’re more conservative). I ended up with closer to 75/25 stocks to bond allocation.

After completing the survey you click on the “Open My Account” button, which takes you into the account opening process. It will ask for all of your personal information including an email, password, employment information, and Social Security number (like you would have to at any brokerage).

Once you’re done entering your personal information you’ll be asked to choose an account type. Currently, you can choose:

Taxable Investment Account
Roth IRA
SEP IRA
Traditional IRA

After you choose an account type you’ll be asked to link a bank to fund your account. You can then choose to fund the account with as little as $500. If you want, you can also set it up to automatically invest for you every month. I have it set to automatically invest $300 for me on the 15th and 30th of the month.

Once you’re done your account will be sent to Axos Financial for approval. Their site says it takes about 5 business days for an account to be approved.

Axos Invest Investment Philosophy

Axos Invest will invest your funds based on Modern Portfolio Theory (MPT).

We use the tools of Modern Portfolio Theory to design the optimal portfolio for a given level of risk. In addition, we further optimize our investment process to minimize tax consequences and streamline the reinvestment of dividends and contributions.

Their investment philosophy is built upon four main pillars:

The value of diversification
Keeping fees as low as possible
The value of passive investing
Starting sooner rather than later

Axos Invest will attempt to give you a portfolio that is well-diversified, low-cost, and at low minimums so just about anybody can get started now. They’ll use the ideas behind MPT to give you the optimal portfolio for your given risk score.

The Actual Investments

So what are you getting when you invest with Axos Invest? You’re getting a well-diversified portfolio that contains passively managed exchange-traded funds (“ETFs”).

The funds held with Axos Invest have an average fund fee of 0.12% – the only fees you’ll pay to invest. Here is the breakout for the individual funds they use (the funds used by Axos is subject to change, and probably will) and their expense ratios:

Vanguard Total Stock Market ETF (VTI): 0.03%
Schwab U.S. Broad Market (SCHB): 0.03%
Vanguard FTSE Developed Markets ETF (VEA): 0.05%
Schwab International Equity (SCHF): 0.06%
Vanguard FTSE Emerging Markets ETF (VWO): 0.15%
iShares Core MSCI Emerging Markets (IEMG): 0.14%
Vanguard REIT Index Fund (VNQ): 0.12%
iShares U.S. Real Estate (IYR): 0.42%
iShares Investment Grade Corporate Bond ETF (LQD): 0.15%
Vanguard Intermediate-Term Corporate Bond Index (VCIT): 0.05%
Vanguard Intmdte Tm Govt Bd ETF (VGIT): 0.05%
iShares Barclays TIPS Bond Fund (ETF) (TIP): 0.19%
State Street Global Advisors Barclays Short Term High Yield Bond Index ETF (SJNK): 0.40%
PIMCO 0-5 Year High Yield Corporate Bond Index (HYS): 0.56%
Vanguard Short-Term Corporate Bond (VCSH): 0.05%

As you can see they have a broad diversification that also includes real estate via the Vanguard REIT Index fund, which isn’t something that Betterment gives you.

The performance of Axos Invest has been pretty good. As you can see from the screenshot from Barron’s “Ranking the Robos” article below, WiseBanyan/Axos Invest had the second-best two-year annualized return, through 6/30/19. Not too bad!

Axos Invest Mobile App

When the service first came out one of the complaints some users had was that there was no mobile app for the service. A mobile-optimized app for iOS was released shortly thereafter, as well as an app for Android users.

From the app, you can now do things on the go like check your balances, view your allocations, make a quick deposit, and more. The apps really are very pretty to look at and are a pleasure to use.

Axos Invest Fees & Account Charges

One of the biggest draws for Axos Invest when they started was the fact that they were essentially a fee-free service. While that is no longer the case, they are still very low-cost, one of the lowest-cost robo-advisors on the market.

Here are a few of the fees (or lack thereof) that you’ll see with the service:

Managed Portfolios

Management fee: 0.24% of assets under management. Accounts less than $500 pay $1/month.
Trading fees: FREE
Rebalancing fees: FREE
Dividend reinvestment fee: FREE

Self-Directed Trading

Stock Trading fees: FREE
ETF Trading Fees: FREE
Options trading: $1 per contract

Self-Directed Trading – Axos Elite

Axos Elite is the premium self-directed investing service that offers more powerful investment tools, real-time market data, extended trading hours, lower fees, stock lending, and margin trading.

Monthly fee: $10/month
Stock Trading fees: FREE
ETF Trading Fees: FREE
Margin Trading: 5.5%
Options trading: $0.80 per contract with Axos Elite

So essentially the Axos Invest service is very low cost with only the 0.24% AUM fee for Managed Portfolios. There are no trading fees, and no fees to rebalance your account or reinvest dividends. Competing services often charge much higher annual management fees, so with Axos being one of the very lowest when it comes to fees, you’re saving on those fees right off the bat.

There are some fees related to transferring funds via wire transfer, or do a full account transfer out, although regular electronic funds transfers (EFT) are free.

Electronic Fund Transfer (EFT) fee: FREE for deposits or withdrawals.
Wire transfers in: FREE (although your bank may charge).
Wire transfers out: $30 per domestic wire transfer.
Account closing fee: FREE.
Full account transfer out fee: $75 per account.
Partial account transfer out fee: $5 per security ($25 minimum/$75 max).
Disbursement of funds by check by mail: $10 per check.
Returned check fee: $40 per occurrence.

As mentioned above, Axos Invest’s product and service is very low cost and there are only a few small fees for certain types of transfers or check disbursements.

Premium Add-On Products & Services

There are several premium packages in your Axos Invest account that have a fee associated with them. You can turn them off and on whenever you want.

Currently, the premium packages include:

Portfolio Plus: The ability to create your own custom portfolio from an expanded list of investments. You can choose from lists of different investment classes and types and add up to 20 investments to each portfolio you create. It costs $3/month to use this add-on package.
Quick Cash: When activated this gives you quick same-day deposits, auto-deposit scheduler, and overdraft protection. It costs $2/month to use this add-on package.
Tax Protection: This package will give you tax loss harvesting, selective trading (to remove ETFs you hold elsewhere to avoid the potential for wash sales) and IRAutomation, which helps you to maximize the use of your retirement account deposits, setup auto deposit plans and more. Each month the cost will be the lesser of 0.02% of your average Axos Invest account value (0.24% annually) or $20. So if you have $5,000 in your account, the monthly cost would be $1.

Using these add-on packages is purely optional, but even if you were to turn them all on it likely isn’t going to cost you more than a few bucks per month.

Axos Invest: Great For Cost-Conscious Investors

When I first read about Axos Invest I dismissed it out of hand because I thought that there had to be a catch somewhere, there’s no way they were offering this service for such a low cost when others are charging anywhere from .35%-1.0% annual management fees for similar services.

After looking into it further, however, it does truly seem like Axos Invest is committed to offering a low-cost investing service for both self-directed investors and those who want their portfolios managed for them.

Axos Invest does seem like a good option for newer investors. Not only can you start investing with no account minimums, and low management fees – but you can buy fractional shares with as little as $10 and get a highly diversified portfolio that should match the market in the long term.

The account has SIPC protection that covers up to $500,000 per client as well, so if Axos Invest were to go under you’d be covered.

I’ve signed up for my own Axos Invest account and have been with them now for years. They are my go-to recommendations for new (and even experienced) investors.

Open your own account below via my invite link.

Get Started With Axos Invest Now!

Axos Invest

Ease of use

9.5/10

Design

9.5/10

Cost efficiency

10.0/10

Investment strategy

10.0/10

Available tools

9.5/10

Pros

Low management fees
No trading or rebalancing fees
Proven strategy
Low minimum investment
Auto investing

Cons

Cash can take a bit to be invested

Source: biblemoneymatters.com

Apache is functioning normally

May 24, 2023 by Brett Tams

How Do Payday Loans Work? – SmartAsset

Close thin

Facebook

Twitter

Google plus

Linked in

Email

arrow-right-sm

arrow-right

Tap on the profile icon to edit
your financial details.

Many Americans have income that fluctuates from week to week. When incomes are unsteady, any unexpected expense can leave you coming up short. If you don’t have a fully funded emergency fund, you may find yourself looking around for loans to bridge the gap and get you to your next paycheck. Payday loans are out there, but at a high cost to borrowers. Before taking out a payday loan you may want to first make a budget. You can work with a financial advisor who can help you make a long-term financial plan that you can budget your finances to meet.

Payday Loans: Short-Term Loans with a High Price

What are payday loans? Say you’re still 12 days away from your next paycheck but you need $400 for emergency car repairs. Without the $400 your car won’t run, you won’t make it to work, you’ll lose your job and possibly lose your housing too. High stakes.

If you go to a payday lender, they’ll ask you to write a future-dated check for an amount equal to $400 plus a financing fee. In exchange, you’ll get $400. You’ll generally have two weeks or until your next paycheck to pay that money back. Say the financing fee is $40. You’ve paid $40 to borrow $400 for two weeks.

If you pay back the money within the loan term, you’re out $40 but you’re not responsible for paying interest. But the thing is, many people can’t pay back their loans. When that happens, the money they borrowed is subject to double-digit, triple-digit or even quadruple-digit interest rates. It’s easy to see how a payday loan can lead to a debt spiral. That’s why payday loans are illegal in some places and their interest rates are regulated in others.

When your loan term ends, you can ask your payday loan lender to cash the check you wrote when you agreed to the loan. Or, you can roll that debt into a new debt, paying a new set of financing fees in the process. Rolling over debt is what leads to a debt spiral, but it’s often people’s only choice if they don’t have enough money in their account to cover the check they wrote.

Are Payday Loans a Good Idea?

Not all debt is created equal. An affordable mortgage on a home that’s rising in value is different from a private student loan with a high-interest rate that you’re struggling to pay off. With payday loans, you pay a lot of money for the privilege of taking out a small short-term loan. Payday loans can easily get out of control, leading borrowers deeper and deeper into debt.

And with their high-interest rates, payday loans put borrowers in the position of making interest-only payments, never able to chip away at the principal they borrowed or get out of debt for good.

Payday Loans and Your Credit

Payday loans don’t require a credit check. If you pay back your payday loan on time, that loan generally won’t show up on your credit reports with any of the three credit reporting agencies (Experian, TransUnion and Equifax). Paying back a payday loan within your loan term won’t boost your credit score or help you build credit.

But what about if you’re unable to repay your payday loan? Will that payday loan hurt your credit? It could. If your payday lender sells your debt to a collection agency, that debt collector could report your unpaid loan to the credit reporting agencies. It would then appear as a negative entry on your credit report and lower your credit score. Remember that it takes seven years for negative entries to cycle off your credit report.

Having a debt that goes to collections is not just a blow to your credit score. It can put you on the radar of some unsavory characters. In some cases, debt collectors may threaten to press charges. Because borrowers write a check when they take out a payday loan, debt collectors may try to press charges using laws designed to punish those who commit fraud by writing checks for accounts with non-sufficient funds (these are known as NSF checks).

However, future-dated checks written to payday lenders are generally exempt from these laws. Debt collectors may threaten to bring charges as a way to get people to pay up, even though judges generally would dismiss any such charges.

Alternatives to Payday Loans

If you’re having a liquidity crisis but you want to avoid payday lenders, there are alternatives to consider. You could borrow from friends or family. You could seek a small personal loan from a bank, credit union or online peer-to-peer lending site.

Many sites now offer instant or same-day loans that rival the speed of payday lenders, but with lower fees and lower interest rates. You could also ask for an extension from your creditors, or for an advance from your employers.

Even forms of lending we don’t generally love, like credit card cash advances, tend to have lower interest rates than payday loans do. In short, it’s usually a good idea to avoid payday loans if you can. Instead, consider working on a budget that can help you get to your next paycheck with some breathing room, and make sure you have a rainy day fund.

The Bottom Line

When considering a short-term loan, it’s important to not just look for low-interest rates. Between fees and insurance policies, lenders sometimes find ways to bump effective interest rates to triple-digit levels even if they cap their APRs. The risks of taking a payday loan bring home the importance of working hard to build up an emergency fund that you can draw on.

Tips for Retirement Planning

If you’re not already preparing for retirement then it’s a good idea to create a retirement plan and make sure you’re contributing to it regularly. If you’re overwhelmed or don’t know where to begin, a financial advisor can help you map it all out. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Not sure how much you need to save for retirement? Consider using our free retirement calculator to get the number you need so that you can start making the right progress.

Amelia Josephson
Amelia Josephson is a writer passionate about covering financial literacy topics. Her areas of expertise include retirement and home buying. Amelia’s work has appeared across the web, including on AOL, CBS News and The Simple Dollar. She holds degrees from Columbia and Oxford. Originally from Alaska, Amelia now calls Brooklyn home.

Review your tax withholding

Figure out your income bracket

Plan out your retirement contributions

Contribute to an HSA

Contribute to an FSA

Plan out your RMD

Add up those business expenses

What is Changed?

How Does the Changed App Work?

How Much Does Changed Cost?

Changed Features

Progress Screens

Pick Your Savings Speed

Extra Payments

Link a Credit Card

Have Another Payer Help Out

Other Features

Stash My Cash

My Experience Researching Changed

Who Should Use Changed?

People Who Struggle to Prioritize Extra Loan Payments

People with Competing Financial Priorities

Borrowers with Single or Multiple Loans

Borrowers in Deferments or Grace Periods with their Student Loans

Frequent Debit or Credit Card Spenders

Who Shouldn’t Use Changed?

People Who Want Full-Service Repayment Assistance

People Who Use Other Round-Up Apps

People Who Want to Pay off Their Debt ASAP

Living Like A Rock Star

Starting Out Is Hard

The Benefits Of A Duplex

You Don’t Need To Be A Rock Star To Buy A Duplex

Related Posts

What the CRR Study Says

Underprepared For Retirement – A Wider Trend

About Our Retirement Expert

Categories

Use your current spending as a budgeting model

Be realistic about retirement income

Consider your lifestyle goals and plan for emergencies

Time is on your side

What Is BMO Harris Bank?

How BMO Harris Bank Stacks Up

What Sets BMO Harris Bank Apart?

Key Features of BMO Harris Bank

Account Opening Bonus Opportunities

BMO Harris PremierTM Account — $350 Cash Bonus

BMO Harris Smart AdvantageTM or BMO Harris Smart MoneyTM Account — $200 Cash Bonus

Checking Accounts

Savings Builder Account

Money Market Account

Certificates of Deposit

Individual Health Savings Account

Credit Cards

Loans and Lines of Credit

Wealth Management Services

Mobile Banking App

Advantages of BMO Harris Bank

Disadvantages of BMO Harris Bank

Is BMO Harris Bank Legit?

Final Word

What Are the Top Investment Sites?

1 .Motley Fool Stock Advisor

2. Morningstar

3. MarketWatch

4. Barron’s

5. Wall Street Journal

6. Zacks

7. Seeking Alpha

8. The Financial Times

9. CNBC

10. Kiplinger

11. Stock Rover

12. AAII

13. Yahoo Finance

14. Investopedia

Summary

Axos Invest History

Axos Invest Account Types – Managed Portfolios Vs. Self-Directed Trading

BMO Harris Premier^TM Account — $350 Cash Bonus

BMO Harris Smart Advantage^TM or BMO Harris Smart Money^TM Account — $200 Cash Bonus