Hi All,
If you’ve got a few spare moments and you like real estate, you might consider cruising over to here and gawking at the listings. There is some great stuff, like exclusive ranches, private islands, 15 bedroom houses, etc. etc.
Most people don’t have the money for a private island, but you might find the listings interesting regardless. Click here.
Best,
James
Hi All,
For many couples managing conflict is not an easy prospect. So, here are two tips on ways that you can turn conversations about finance from stressful interactions to productive exchanges.
1) Paraphrasing: A great way to acknowledge someone’s concern or point is to paraphrase it. This essentially means that you listen to what the person had to say, then repeat it back to them in words that you understand. Here is an example dialogue to illustrate the point:
Wife: I can’t believe that you spent $800 dollars on chinese food and movies. I hate it when you do that, it makes me feel frustrated and angry that you’re wasting money like that. How did you manage to do that anyways?
Husband: Wait, so what you’re saying is that you feel frustrated when I overspend?
Wife: Yes, and another thing…
The main point about paraphrasing is that it gives the speaker the chance to feel they have been heard. It also gives the listener a chance to engage in an active listening processes, thus increasing the chances that in fact, they will hear and understand the concern.
2) Avoid Blanket Statements and Stick to The Facts:
When people fight, they often tend to draw on totalizing statements. This typically is something like: “You always” “You never“, “Why do you always screw that up”, “When you go out with your friends, you always spend to much”, etc. Blanket statements like always and never are rarely true. The reaction on the part of the listener when hearing blanket statements is often frustration and irritation, which can heighten conflict.
Instead of using blanket statements, name specifics. So, instead of saying something like “you always spend to much with your friends” consider naming specifics – “Last Thursday and the Thursday before that, you spent $100 on handbags“. In this case you’re naming specific times and amounts. Citing specific behaviors or facts does two things. First, it lowers the emotional stakes. Second, using specific facts sharpens the discussion to focus on specific behaviors that are problematic. Both of these make it easier to have a discussion about money – the discussion is about facts & behavior, not someones character.
Readers – if you have any other thoughts on this, please do share them in a comment. There isn’t much discussion on this topic. This is a shame because most couples fight about money at least once during their marital careers.
Best,
James
Hello All,
For those of you who dislike the IRS, here is a story that might interest you. Evidently a Baxter, Minnesota accountant took on the tax man over a question of payments from life insurance. To everyone’s surprise, he won.
Best,
James
Marketwatch.com is reporting that federal regulators have shut down Kansas based Colombian Bank and Trust. This is the 9th bank so far this year to fail.
Click here for the story.
Best,
James
With the high price of gold and the weakened dollar, some might consider whether gold is a good investment these days.
First of all, if you have any serious money you’re probably better off buying stocks or investing in real estate. Unlike stocks and real estate, precious metals have not had good historical returns and don’t produce income.
However, if you really want some gold, there are several ways to go about buying it.
1) Physically:
If you want to take actual physical possession of the gold, there are a number of options.
A) Ebay: Small amounts of gold are typically available on ebay. If you’re cash constrained, you can get grams of gold, 1/10 oz coins or 1/20 oz coins or smaller bars. In most cases all you have to do is buy the gold through ebay and the seller will send it to your home address.
B) Find A Local Dealer: If you look around there is usually someone in your local area who specializes in selling precious metals. Typically they’ve got a name like “Coin and Stamp” or “Jewelery and Coin”. The phone book or google can get you their number pretty quickly.
Here is a tip, before you go to your local dealer, check the spot price of gold. This way you will know how much the metal is worth on the open market. Once you know this, you’ll have a better basis for determining what a fair price is or isn’t. Most metal trades at only a couple of dollars above the spot price. For example, if the spot price of gold is $800 an oz and a dealer wants to charge you $900, look elsewhere because you should be able to get it for spot plus a small mark up, – usually like $20 to $40.
Ebay and coin dealers and ebay are often a good way to go when you’re on a budget.
2) Electronically:
A lot of people want exposure to precious metals without the bother of taking possession of the metals themselves. There are some ways to buy gold electronically that minimize the hassles associated with actual physical possession of the gold.
A) Pool accounts. Kitco.com has an interesting service whereby you buy gold, but the company agrees to hold onto the metal for you. This way you can still profit from price increases, but don’t have to deal with the bullion itself. Click here for kitco’s website. Goldmoney.com has a similar deal. For these accounts, you need to sign up via the companies webpage.
B) Exchange Traded Funds and Mining Stocks. In addition to direct ownership of gold, there are a number of investment funds and gold mining companies you can invest in. While these types of investments do not involve direct ownership, the performance of these classes of securities is highly tied to the price of gold.
There are a number of good postings on which funds and gold mining stocks to consider, and since we DINKs don’t know much about this section of the market, you might consider getting started with a posting from MSN.com or seeking alpha.
Lastly, if you are a travel buff like Miel, you might just head to the gold souk in Dubai or Doha to get the real deal. You’ll spend more getting there than you’ll likely to get back as a return, but the experience is worth it!
Best,
James & Miel
So in following up to my post yesterday about noticing a decline in the economy through my retirement account, what I didn’t mention was how happy I am to actually see that account reach above $50,000.
The thing is, I didn’t have that five years ago. Five years ago I was about to loose my job and up to my ears in credit card debt for the first time in my life.
What have I done since then to turn things around?
Two simple things.
1) I’ve lived within my means.
2) I’ve saved everything else.
In that first year it meant paying off $13k in credit card debt, within a year, when I was only making $35k gross. So when I say that I was saving everything else, I really mean it.
I’ve also worked very hard in my career to get regular pay raises that allow for the extra income. With each pay raise I just pretend it’s not there, and simply save it.
$16k of the $50k was also contributed by my employer. This is another reason to pay attention to what the retirement package is.
I didn’t actually start putting money into my retirement until my credit card was fully paid off at the beginning of 2005. Then I just added a bit more at a time until I was able to max out on retirement contributions for the first time last year.
My point is, just because you don’t have much put away today, doesn’t mean you can’t start now. It is within most American’s means to put away more than they do today. That may be harder with prices going up, but it is achievable.
Sure, there are those who would rather spend it today, and that is fine. But I’d rather be able to work to achieve my dreams. If you really think about it you likely would too.
For those who are just starting out, ING has a ROTH IRA program that lets you start building an account with as little as $25 a month. You really can’t beat that.
If you are interested in saving, but haven’t gotten around to it. Start now. If you already are putting away, challenge yourself to save just a bit more.
Good luck,
Miel
These days the economy seems to be helping to take us in reverse. I’m currently dealing with transferring over my retirement plan to another provider, and frankly glad to have some hope of better performance soon. The change over meant that I checked up on my balances only a couple of days after updating our net worth.
Miraculously I was able to drop five hundred dollars off my account without even having had time to enjoy it. Now I’ve managed to put in $50,000 and have a whopping balance of $50,500. I’m not even keeping up with inflation these days! I’d be better off with a savings bond at that rate.
Hopefully things will pick up with the change in my new retirement fund, but I think for now the economy is likely to just continue to take its tole. I’ll just keep saving and buying while things are low. Hold my breath and hope for the best over time.
Best wishes,
Miel
According to the Politico, McCain himself doesn’t know.
I think it’s because McCain has so much wealth that he can’t easily keep track of it. We blogged about McCain’s wealth a while back. He and his wife are worth far more than the 100 million the politico story is reporting. I personally put his wealth at over a billion dollars.
Best,
James
Hello All,
A couple of weeks ago, we received a solitation in the mail from the US district court in Eastern New York. Evidently Washington Mutual has agreed to pay over $4,000,000 to settle two class action lawsuits related to overcharging for flood certification fees. WaMu denies it, but is willing to cough up the money to make the problem go away.
Here is a quick snapshot of the court solicitation.
While I’m not making any direct allegations, its common knowledge that flood certification fees are junk – that is they are often tacked on by lenders to pad the bottom line. That said, you can draw your own conclusions.
Best,
James
Hello All,
When we DINKs make a new stock purchase, we like to blog about it. Well, just today we’ve take a position in Umpqua Bank (UMPQ). Over the past couple of days, I’ve been kicking the tires by checking out their financials, listening to their conference calls and poking around on-line.
Here are my thoughts on the company:
What is Umpqua? Umpqua bank is a regional commercial bank located in the pacific northwest. Its got approximately 147 branches and 1,744 staff. The company is classified as a “small cap”, which means that its a junior member of the banking community relative to bigger outfits like Wachovia or Citibank. The bank makes money primarily from lending to businesses, selling checking accounts and managing investments for rich people.
Why did we make the investment decision?
1) Healthy financials. Relative to its peers in the banking industry, UMPQ is making money. Earnings for 2008 are down relative to 2007, but the .59 cents the company earned in the first quarter are far better than $1.02 loss at Citigroup or .39 cent loss at Wachovia. The company also has a 5.59% dividend, which appears sustainable.
To be entirely fair, the Umpqua’s financial situation has weakened over the past year. For example, its year over year cash situation declined from 335 million to about 192 million in the the second quarter. Also, Schwab investment research projects that next years earnings will be soft and the effects of the recession and subprime crisis mean that banking stocks are out of favor.
However, Umpqua has no exposure to the subprime market and most of its lending has been to businesses, rather than to individual homeowners. Its also recently shown some organic growth in the number of checking accounts its signed up, 5% more in the second quarter. So the soft earnings are balanced by the fact that its business is primarily in sectors that haven’t been hit as hard by the subprime crisis.
2) Management: The current management has done an excellent job growing the company from a single branch with 8 employees in 1953 to the 147 branches it has today. It has recently acquired a couple of smaller regional banks in Oregon and California. Plus, the company has been the subject of several case studies examining its innovative interior design and branch layout. UMPQ was recently ranked 13th by Fortune Magazine’s survey of the best American companies to work for. – All of this suggests that management is on top of core businesses fundamentals like growth and user friendliness.
3) Investor Sentiment: Umpqua is primarily owned by big investors, with fully 61% of its outstanding shares being owned by mutual funds or other institutional players. This indicates that “smart money” likes the company. Also, if threads on google finance are any account, small investors feel optimistic about the company as well.
Its true that bank stocks are out of favor at the moment, its also true that the nation is experiencing a recession, but – that said – at our buy price of $13.03 UMPQ looks to be a promising long term investment.
Our trade executed this morning, so we’ll see how it works out in the coming months.
Best,
James
You cannot copy content of this page