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Four Rules Of Thumb That Are Thumbs Down

For many years I have seen articles galore in the major magazines giving consumers “rules of thumb” about making financial decisions.   In a society today where we want to get all of our information in sixty seconds or less, many of these magazines can talk one week about five dollar meals to make and then the next week discuss major financial decisions to make in your household.   I’ve never really been a big fan of “rules of thumb”, so here are four major financial “rules of thumb” that I am simply thumbs down on when it comes to making smart money moves.  Rule Of Thumb #1- 2% Difference In Interest Rate To Refinance –   Many popular magazine and newspaper articles will suggest that you generally shouldn’t consider refinancing unless the difference between the new interest rate and your old interest rate is 2%.    This “rule” makes very little sense to me. What you want to be considering are a handful ...

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VIDEO | Grocery Shopping with Peter Lynch

Published on Nov 29, 2012 For the past three years, I have been an avid personal finance blogger discussing everything from managing your wealth to mitigating your tax liability. No matter how substantive the topics I wrote about in the personal finance sector, the big question was whether someone would actually read my content. As bloggers, we often believe that our most recent post will change the lives of millions, but in reality only a handful of people may click through your e-mailed link to read your weekly blog post. The art of creating effective titles is incredibly important because if your title and opening paragraph are catchy and interesting, your readers are more inclined to check out the rest of the article. Take the title I opened up with in this article. Did it make you at least a little bit curious about what happened when Peter Lynch went grocery shopping with me at Whole Foods the other day? Or ...

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Active Trader: Time to Curb Your Enthusiasm

But this is a dangerous time, experts say, because a trader’s inflated ego can get in the way of sound investing decisions. The thrill of buying a winning stock can keep them from selling that stock and locking in profits. “The human mentality is to want to have a winner,” says Todd Salamone, senior vice president of research for Schaeffer’s Investment Research. “It’s psychologically hard to admit you’re wrong.” Meanwhile volatility, after seemingly taking the summer off, has started to return to the stock market. The CBOE Volatility Index, known as the VIX and a commonly-used guage of the market’s volatility, was as low as 22 in mid-August, but popped up above 30 last week. ...

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Should You Convert Your Roth IRA?

Hey folks, I’ve got a news flash for you. Going into October, it isn’t just football season, it’s recharacterization season. While most of you are worried about the stock market, I hear individuals and businesses talk everyday about what they should do with their money. (i.e. should I put it in the market, should I put it in a bank account, where is the best place that I should put my money?). The reality is right now, you can’t always think about your portfolio, but also you have to start think about tax strategy. With that being said, for folks out there that make less than $100,000 adjusted gross income, you’ve got the ability to do what’s called recharacterizing your IRA. What this would give you is the ability to do if you make under $100,000 in adjusted growth income is to take your existing IRA and put it into a Roth IRA. There is a handful of legislation that ...

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