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Financial Tips 2018: How to get ahead on taxes, savings and insurance

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Financial Tips 2018: How to get ahead on taxes, savings and insurance

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It's 2018 and now’s the time to get your finances in order.

To help you and your family make all the right money moves next year, here’s a financial game plan that could help you grow your 401(k), avoid financial ruin and adjust to the new tax rules signed into law by President Trump.

Just as a New Year’s resolution to get fit can fail if you don’t hit the gym, getting ahead financially is tough if you don’t set up a plan and stick to it, says Dana Anspach, founder and CEO of Sensible Money, a wealth management firm in Scottsdale, Ariz.

Doing an annual financial check-up, she stresses, is only worthwhile if you use it as a jumping off point to “build good habits.”

“It’s figuring out the baby steps you can take that moves you and your money in the right direction,” Anspach says. “Every family should put together a playbook for the year.”

Here are steps to take to get you on the road to financial success.

Start with the Basics

Insurance isn’t sexy. In fact, it’s boring. It’s viewed by many Americans as just another bill, not an investment.

But insurance is the foundation of any financial plan, as it protects people from catastrophic losses that can wipe them out. Jan. 1 is the time to make sure your family has enough life insurance to pay for the kids’ college, keep current on the mortgage and fund other living costs in the event you or another breadwinner in the family dies, causing a loss of income.

“Check all of your insurance coverage,” especially if your life has undergone changes, such as having a child, advises Carla Dearing, CEO and founder of Sum180, an online financial wellness company in Louisville, Kentucky.

That means making sure your house, car, health and life is adequately insured against events that could put your family in financial peril.

Other basics not to overlook are making sure your will and estate plan are updated and all your financial accounts have the proper beneficiaries, adds Steve Janachowski, CEO of Brouwer & Janachowski, a wealth management firm in Mill Valley, California.

Tax Plan Tune-Up

The new tax law means most Americans’ tax bills will change. Some will pay more and many will pay less. Many longstanding deductions, such as home mortgage interest and state and local taxes have been cut or eliminated.

Uncertainty, as a result, is high.

“It’s important to understand what the new tax bill means to you,” says Paul Jacobs, chief investment officer at Palisades Hudson Financial Group in Stamford, Connecticut.

Taxpayers should analyze how to best take advantage of any benefits they receive. Perhaps more important, figure out how to minimize financial damage caused by changes to the tax code that reduce take-home pay or make owning a home more expensive.

For example, homeowners in coastal states where housing is expensive and taxes are high might need to rethink their real estate holdings after losing key deductions. Under the new tax law, the deduction for mortgage interest has been capped at $750,000, down from $1 million, and deductions for state and local taxes have been capped at $10,000. These changes could mean owning a home in 2018 and beyond will be more expensive.

While moving from your current home is a big decision that should not be taken lightly, “it may make sense to revisit where you live,” Jacobs says.

People living in high-cost states that are either approaching retirement, in line for a new job in another state or who aren’t happy where they're living now, “might want to consider moving to a low-tax state, such as Florida,” he says.

Simpler moves include reducing the money withheld from your paycheck for taxes if you’re getting a cut, or boosting your withholding if you expect to pay more in taxes.

It also makes financial sense to direct some or all of your tax windfall to your retirement account, or 529 college savings account, which can now be used to pay for private school from elementary school onward, adds Peter Mallouk, chief investment officer at Creative Planning in Kansas City, Kansas.

“Save the extra money before you get used to spending it,” Mallouk says.

401(K) Check-up

With employer-paid pensions no longer the major source of retirement income, personal savings accounts such as 401(k) s and IRAs need annual tune-ups to ensure they're building wealth efficiently.

And given that many Americans have some of their retirement savings invested in the stock market – which has been going up for nearly nine years and posted a 19.4% gain in 2017 – now’s a good time to review these accounts to make sure they are properly diversified and not too risky, says Scott Kubie, chief investment officer at Carson Group, an Omaha-based investment firm.

Many investors’ portfolios today may be more risky than they think. A portfolio that once had 60% in stocks and 40% in bonds, for example, may now have a stock weighting of 70% or more.

“I encourage people to look at their holdings and make sure they are not overexposed to risk that they are not prepared to handle,” Kubie says.

To reduce risk, investors should rebalance their portfolios, or get back to their initial asset mix of, say, 60% stocks and 40% bonds, he says.

One way to do that is to sell assets that have performed well and redirect the money into investments that haven't done as well. If investors don’t want to sell what they currently own, they can get their portfolio back in whack by directing future contributions into the part of their portfolio that originally represented a bigger slice of their overall investment pie.

Another tactic is to invest some cash in overseas stock markets, rather than focus exclusively on U.S. markets, Kubie adds.  “Make sure you have some international exposure,” he says.

And now that the government has reduced the number of deductions available to tax-payers, the 401(k) is emerging as a key vehicle to shelter income from taxes. A dual income family, for example, that earns $100,000 per year and takes advantage of the pre-tax 401(k) contribution limit of $18,500 could slash their taxable income by $37,000.

“People should try to max out their 401(k),” says Janachowski. “It’s a no brainer.”

What investors should not do is try to time the market, or get out just because some pundits say the market is pricey and is due for a fall, he adds. “Start early and save consistently,” says Janachowski, adding that he believes corporate earnings and stocks will benefit from the cut in the corporate tax rate to 21% from 35%.

Home Affordability Check

With fewer deductions, housing isn’t as financially friendly to homeowners, especially in New Jersey and California and other pricey, high-tax states along either coast. Now’s a good time to see if the house you're living in or the new house you're eyeing or the second home you've been dreaming about is still affordable, says Janachowski.

While the reduction in home-related deductions won’t impact most Americans, it could cause financial pain to those it does affect.

“It will be harder to afford housing because the government isn’t subsidizing it as much,” says Janachowski. “Does it mean you shouldn’t own a home or buy a home? No. A house isn’t only an investment; it is a place to live. But it could hit the second-home market and keep people from moving up to bigger homes.”

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In trying to be smart with our money, sometimes we damage our long-term financial future. Here are some such common mistakes, and how to go about avoiding them.

We all intend to do the right thing with our money but sometimes our decisions and actions harm, rather than benefit, our financial situation. Typically this happens when you are in a hurry, or have not thought it through or not tailored a financial action to your specific situation. Here are some common situations where the end result may not be what you wanted, if you don’t take the trouble to do it right.

A budget too tight

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You decide to streamline income and expenses to increase savings. But you overdo things and create a budget that may be designed to fail. The typical errors are to overlook tracking the expenses for a few months, so that you don’t know where you spend and don’t know your level of expense for each category of expense. Without this information, you could fail to allocate adequate resources for your expenses. These errors can derail your budget. A very tight budget, to save more, could prove to be unsustainable so that you may not be able to live with it. This would cause your budget to collapse, leading to your savings targets not being met.

If you are not used to living by a budget, ease yourself into it. Start by imposing broad upper limits. At this stage the focus should be on developing the discipline to account for expenses and to limit them. Once that happens, the next stage would be cutting the expenses, in a realistic manner. Don’t get discouraged if you slip a few times. You will learn with experience.

Going long term too early

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You realize the importance of accumulating funds for long-term goals and start putting all your savings into provident fund or other long-term investments. This would be a good decision if you have taken care of liquidity and have an emergency fund. Long-term products typically have restrictions on withdrawals. Growth-oriented investments, such as equity, have volatile values that may mean that you incur a loss if you had to redeem them at short notice.

Thus, providing for long-term goals is good if you have made provisions for immediate liquidity needs. Build an emergency fund and invest for short- and medium-term needs along with long-term goals. This will ensure that your long-term goals are not put at risk by a need that was overlooked.

Saying no to debt altogether

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You may think that you are protecting your finances by staying away from debt completely. But it may not be so. You may need to take on some debt to meet goals like buying a house. You could choose to stay on rent, but that comes with the risk of inflation pushing rentals beyond your means. A mortgage would also come with tax benefits, which would lower the cost of debt.

Having some amount of debt also means that you can demonstrate responsible debt behavior to get a good credit score, lack of which can result in higher costs if you need a loan urgently.

However, include credit and debt into your finances with discretion. Use debt to leverage your finances. Use facilities like credit cards for regular expenses, to built a credit history.

Penny wise pound foolish

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Very often, we focus on one aspect of a decision and ignore its larger impact. Very often we end up cutting costs by cutting corners. For example, if you buy a durable good that is cheap but of poorer quality, you could end up paying more due to frequent replacements. There are also decisions you may consider clever now, but which could cost you dear later. These could include: avoiding insurance, believing that premiums are a waste of money; not maintaining an emergency fund believing that keeping funds in liquid but low-earning products is under-utilization of money; adopting a do-it-yourself approach, believing that paying an adviser is a waste of money. Not to forget: holding all your funds in low-risk products that earn low returns, ignoring the impact of inflation.

Standing guarantee for others

Be sure of financial standing of the person for whom you are standing guarantee in a loan or giving an add-on credit card to. This act of kindness can damage your own finances. You would be responsible for the repayment if a primary borrower defaults on the payment. You could be saddled with repaying a loan that you neither benefited from nor can bear the burden of. Your credit score will be affected by this loan, and you may even find it difficult to access credit when you need it. Excessive spending on an add-on credit card too will strain your finances, apart from affecting your credit history and score.

Keep in mind the consequences to your own financial situation before you seek to offer financial assistance to others. Consider if the primary borrower can service the loan herself without difficulty.

Give due consideration to your own ability to bear the stress if the obligation passes to you. Similarly, to protect your finances, consider the option of footing the family member’s credit card bill up to a reasonable amount instead of giving an add-on credit card. The person is then liable for all actions and omissions on the credit card and your responsibility is limited to the amount you have offered to foot.

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Ready to quit your day job? There's a trend among some personal finance gurus called FI/RE -- financially independent/retiring early. It means being able to reach a point where you have assets (investment accounts or rental property) that earn enough income to cover all of your expenses. In other words, you're rich enough to quit.

But for most people, getting to financial independence means making some big sacrifices and getting very creative with their spending habits.

How to achieve financial independence

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It comes down to how you save, spend and invest. Maximize your saving -- many of these people figured out how to save 50 percent of their incomes or more, sometimes by purchasing multifamily homes and taking on enough tenants to make an income.

But the spending side is key as well. The author of the website 1500 days, Carl J. set a goal for himself to bring his assets to $1 million in that amount of time. On his site, he details the step he took to reach his goal: Being financially independent and finally leaving the job he despised by April of this year.

Carl readily admits that he was making a good salary (around $100,000) and that he had been maxing out his savings in a 401(k) account along the way. So he was almost halfway to the goal. But he managed to stock away a significant amount of money and achieves his objective by methodically tracking how much his family was spending and cutting away waste.

"I had no idea how much money we were spending," he told CBS MoneyWatch in an interview. "So we did start keeping track of our spending ... I opened up a Google doc and set up categories, going out to eat, bonus things like alcohol, vacations."

By cutting out excessive spending and revamping their lifestyle, he and his wife were able to save a significant portion of their incomes each year and invest the money instead.

Financial adviser Kyle Mast said he has more and more clients come in to ask about achieving financial independence earlier in life, and while it often involves being more creative to make it happen, it can be done.

"Have a high savings rate, low living expenses ... there's all kinds of ways to travel for free, save money on things like cell phones, just by doing a little bit of research," Mast told CBS MoneyWatch.

Invest to build your assets

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But saving will only get you partway to your goal. It's crucial to make your money grow to the point where it can sustain you.

"Save as much as you can, but investing is hugely important and [you need to] figure out how to do it correctly," Carl said. He taught himself how to use personal investing apps as a way to increase the money he was saving.

Financial adviser Lucas Casarez said if people plan to retire early, it's important to do their research and realize how long they'll need that money to last. Remember, you don't want to outlive your retirement savings.

Be aware that if you're under 59½, you won't be able to take money from an account like a 401(k) without paying an early withdrawal penalty.

For those withdrawals, Casarez recommends using nonretirement investing accounts or a retirement vehicle like a Roth IRA, from which the initial contributions can be withdrawn anytime, tax-free.

"Roth accounts are really fantastic tools as far as flexibility," Casarez told CBS MoneyWatch, "Any contributions to a Roth account can be withdrawn without penalty -- though you can't take out the earnings" without penalty.

That said, it's still a good idea to max out your 401(k) contributions while you're working. If you are saving for FI/RE that means up to the $18,500 annual limit not just meeting the employer match.

He cautions that with other types of investing accounts, "Try to mitigate capital-gains taxes. Know what's going to be considered income."

Challenges to consider

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Keep in mind, even when you reach financial independence, it can be helpful to continue working part-time in your current line of work or take on a side gig to maintain an extra income stream or access to health insurance.

Health insurance is a big consideration. You won't be eligible to register for Medicare until age 65, so if you leave your job, you may need to purchase insurance in the private market -- which can be much more expensive than a plan you get through your employer, who helps shoulder the cost.

And though the idea of being able to walk away from a day job and not work again may sound like a dream come true, some financial experts caution people to take care when retiring from work completely, especially at a young age.

"The challenge is that if you're going to retire at age 40, you'll probably live until you're in your 90s and you're going to be pretty active," financial adviser Ryan McPherson told CBS MoneyWatch. "Work provides a tremendous amount of structure, social interaction, challenges and a sense of accomplishment," he said. "You can get bored and depressed very easily. Keeping yourself involved in full-time work or volunteering is very important."

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13 tips to help save money if you live in London, from a financial expert

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13 tips to help save money if you live in London, from a financial expert

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Because ‘savings’ and ‘London’ rarely ever feature in the same sentence

It’s no secret that London is home to some of the highest living costs in the world.

The median annual salary for London is £34,473, but there are many people – especially young people – living on well below this.

After rent and bills are paid, the remainders of pay packets go to food and necessities – so how are we meant to save for that big holiday or to get out feet firmly on the property ladder?

In light of Financial Capability Week this week we spoke to Andrew Johnson, Advice Manager at Money Advice Service who has revealed his 13 top tips for saving when you live in London.

1. Loose change adds up

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By the end of the week, many of us have a few coins left over in pockets and purses – and even down the back of the sofa. Gather up these odd coins each week and put them in a jar. Even just a £1 a week in loose change will give you a cushion of over £50 by the end of the year. Looking after the pennies really can mean the pounds look after themselves.

2. Keep track of what you spend

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Sometimes it’s hard to know where the money goes. Try keeping a spending diary for a week or two where you write down everything you spend from the smallest stick of chewing gum to filling the tank with petrol. This will help you identify items you might be able to cut back on.

3. Reconsider your smoking habit

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If you smoke 15 cigarettes a day, that’s costing you almost £2,000 a year. If you’d like to kick the habit and boost your savings into the bargain, get the NHS on your side. Use the NHS cost of smoking calculator to help you give up smoking.

4. Make sure you’re getting the best deal on your bills

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Shop around for the best deals for your phone, internet and fuel bills and review your suppliers every year to see if you’re still getting a good deal.

5. It’s all about the side-hustle

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There are no simple ways to increase your income. Possible options might be take on extra work – perhaps a job you could do from home, such as child minding, or turning a hobby into a small business, selling things you make. If you have a spare room, you might think about taking in a lodger.

How to find places in your budget where you can save

6. Do up a budget

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The best way to assess what you are spending and get control over your finances is to complete a budget. Our free Budget Planner puts you in control of your household spending and analyses your results to help you take control of your money. Alternatively try keeping a spending diary for a week or two where you write down everything you spend from the smallest stick of chewing gum to filling the tank with petrol. This will help you identify items you might be able to cut back on.

7. Have a goal

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Having a savings goal can help determine which account is best for you. If you have more than one goal you could use different accounts for each one.

8. See if your bank offers bonus rates

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Some accounts may offer a high bonus rate which is designed to tempt you in – but bonuses drop off after a certain period. If you don’t have time to keep switching, avoid accounts offering bonus rates and look for a rate that’s been more stable historically.

9. If you don’t know where to start with bank accounts, try comparison websites

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Best buy tables and comparison websites are a good starting point for anyone trying to find a savings account tailored to their needs. Not all comparison websites will give you the same results, so make sure you use more than one site before making a decision.

10. Set up a savings account

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If you want to earn a bit more interest then consider a regular savings account but remember, with these types of accounts or fixed term accounts you might not be able to access your money immediately without paying a penalty.

What is the best way to create a budget?

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11. Review your budget every few months

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Life is unpredictable so try to review your budget and your spending if there’s a change, or at least every couple of months. You might get a pay rise, which means you can save more, or you might find your household bills increase.

12. Put time aside to manage your money (like you put time aside to go to the gym, see friends etc.)

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Taking the time to manage your money better can really pay off. It can help you stay on top of your bills and save £1,000s each year.

13. Use an app to help you budget

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There are also some great free budgeting apps available and your bank or building society might have an online budgeting tool that takes information directly from your transactions. Just grab as much information as you can about your income and spending (bills, bank statements…) and get started.

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13 tips to help save money if you live in London, from a financial expert

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5 Big Retirement Money Mistakes to Avoid

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5 Big Retirement Money Mistakes to Avoid

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It’s never too late to start getting smart about money.

Maybe you’ve made it this far with few problems … you’ve done pretty well all alone just by winging it. Good for you.

But retirement planning isn’t about the past 30 years of your life — it’s about the next 30. And that’s harder. There are decisions you can’t undo, and mistakes are tougher to recover from when you don’t have a paycheck to back you up.

Here are five big money mistakes people make every day that a comprehensive retirement plan can help you avoid:

Written by Bill Smith, the host of the television and radio show "Retirement Solutions." Author of "Knock Out Your Retirement Income Worries Forever." He is the CEO of W.A. Smith Financial Group and Great Lakes Retirement Inc. His firms specialize in retirement income planning, wealth management, wealth preservation and estate planning.

Big Mistake No. 1: Choosing your retirement date based on age alone.

People often decide to retire at a certain age because it coincides with some well-known retirement milestone. They’ll settle on 65, for example, because that’s when Medicare kicks in, or 66 because it’s their full-benefit age for Social Security. Some even say 59½, because that’s when they can access their retirement accounts without any extra penalties. But before you decide when to retire, it’s crucial to assess your income needs and if you’ll have enough to meet them. If you retire before you’re 62, will you have enough money to draw from until your pension and/or Social Security payments kick in?

Remember, if you’re taking money from a tax-deferred account (such as a 401(k) or a traditional IRA), Uncle Sam will want his share. If you need $5,000 a month, you’ll have to withdraw closer to $6,500 just to net that amount. At the very least, you’ll spend down an enormous portion of your money very quickly, and you could put your entire retirement at risk. Which takes us to …

Big Mistake No. 2: Investing all your money in stocks.

If there’s a downturn in the market while you’re depending on your investment accounts for income, it could be devastating — especially if all your money is in equities. If those stocks drop 10%, 20% or more, and you have to sell them to pay your bills; you’re going to run out of money before you know it. The term “sequence-of-returns risk” should strike fear into every retiree’s heart. And don’t forget, those dividends that sound so good when you’re buying in aren’t guaranteed if things go bad.

Yes, with this bull market, it’s tempting to stay with stocks, but in retirement, a diverse portfolio is vital.

Big Mistake No. 3: Waffling on whether to buy an annuity.

There are pros and cons to annuities — the key knows what’s best for you and your unique situation. And that’s another reason why it’s important to have a plan. This isn’t a decision you should make based on what others tell you. Your adviser can help you determine whether you need an annuity based on whether you’ll require guaranteed income at some point in your retirement. And if it would benefit you to have one, he can help you decide how large that annuity should be.

Big Mistake No. 4: Losing track of an old 401(k) account.

This is another one of those things that gets away from people because they get busy. It isn’t that you forget about it completely — it’s just not getting any attention anymore because you aren’t adding to it. Which means the account probably isn’t being updated to reflect your risk tolerance as you near retirement? Also, if the account isn’t part of your overall plan, it may not include the proper investment vehicles to help you accomplish your goals.

You may think of it as benign neglect, but someone should be managing that money — either you or your financial adviser — whether you roll it over into an IRA or not. You absolutely don’t want to just leave those dollars out there, waiting for something bad to happen in the markets.

Big Mistake No. 5: Being unrealistic about rates of return.

People hear that the S&P 500 has averaged a 9.6% return since 1930, and that’s what they expect to earn. That number, of course, is deceiving. There are good years and bad years, and the typical investor will react to each in just the wrong way — selling low out of fear and buying high out of greed.

Unfortunately, many retirees have that 8% or 9% return in mind when they decide their withdrawal rate in retirement. If they only get 5% or 6%, they either have to adjust their budget accordingly — which takes discipline — or take on more risk. It’s better to project a more conservative number that works within your overall plan — maybe 4% or 5%. If you get higher returns, great — but if you don’t, you’re far less likely to run out of money.

Final take: 4 keys to retirement success

Retirement should be something you can look forward to with confidence, and winging it won’t give you that. Here are some keys to success:

1. Take market risk seriously when it comes to investing retirement money.

2. Don’t rule out any kind of financial product without having a true understanding of how it would fit into your plan.

3. Take control of all your retirement dollars; make sure you’re not forgetting about anything.

4. Seek help from a professional who can guide you. A retirement specialist can help you build a plan and will assist you as you make your way to and through this next stage of your financial life.

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5 Big Retirement Money Mistakes to Avoid

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When I first started investing, I had many questions. Fortunately, I had helpful and experienced investors around me who were able to guide me through my first steps as a stock market investor. However, others may not be so fortunate and may, as a result, be put off from investing due to fears of making a mistake.

Because of this, I thought I would answer three common questions that new investors might have.

How much should I invest in my first stock?

This may be the first question that many new investors might have. In reality, there is no simple answer to this question. It depends on a multitude of factors such as your risk appetite, portfolio size, and investment strategy.

Having said that, I believe that all investors should still follow a few rules of thumb before making a decision on this.

First, our investment size should be large enough such that the commission charges do not exceed 1%.

For instance, investors should try not to make a transaction below $1000 while using brokerages that charge a minimum of $10 per transaction. Overlooking the effects of these transaction fees could be detrimental to our overall portfolio returns.

Second, investors should diversify their portfolio adequately and each stock should ideally not exceed 10% of your entire portfolio. This is to ensure that any bad investments cannot overly affect your total portfolio returns.

Where can I get stock ideas?

Recently, I wrote an article on three good ways we can screen for stocks. Firstly, by screening for stocks those are undervalued or trading at low premiums. Investors can also take a top-down approach and seek out growing industries, before narrowing their options to specific companies within that industry.

Finally, and maybe the best option for new investors would be to use a stock recommendation service that provides monthly new stock picks for investors. It is important to choose a reasonably priced stock recommendation service that has a long history of beating the market.

Should I actively manage my own portfolio or use professionals?

Before deciding whether to manage your own portfolio, it is important that we understand our own investment capabilities.

Investing requires patience, good control of emotions, and an understanding of businesses and stocks. New investors who are looking for above average returns and have the confidence and knowledge on stocks should consider managing their own portfolio. This is because we can have better control over our finances and can avoid paying hefty management fees.

Unfortunately, there are also often numerous retail investors who over-estimate their capabilities or are prone to investing mistakes due to greed and fear. This has led to retail investors underperforming the index by a considerable amount.

For instance, between 1990-2000, the S&P 500 index returned 7.81% annually. On the contrary, retail investors averaged only 3.49%. If you fear that you are unable to make good investment decisions due to poor control of emotions, seeking a professional for help may be your best option.

The Foolish bottom line

New investors will unsurprisingly have many questions before they start investing. Hopefully, this article adds a little bit of insight for new investors who are just starting out on their investment journey.

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Top seven tips for saving money and making your dollar work for YOU

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Top seven tips for saving money and making your dollar work for YOU

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Saving money and cutting costs is often as exciting as watching paint dry.

But finance guru and Sugar Mamma founder Canna Campbell has revealed her seven top tips to get you enthusiastic and confident about growing your bank account.

The Australian video blogger says getting yourself into a healthy routine with money is the best starting point for saving money and making every dollar count.

In her latest YouTube video, Canna shared seven simple ways you can cut costs and squeeze every penny so you can sit back and watch your savings flourish.

1. Have a Deadline

Canna says setting yourself a reasonable but clear deadline for your savings goal is the first step towards maximizing your money.

If you have a goal of saving $10,000 in five months, the finance expert recommends pinpointing a specific date on your calendar for your deadline - which instills a sense of urgency in your mind every time you see it.

'That way you feel feel a lot more accountable and realize that time is ticking for your end date,' Canna said in her video.

2. Have a Budget

The second step in Canna's seven saving tips is to outline a tight budget for your spending money.

Setting a budget helps savers identify spending habits and provides a clear picture of what you really value.

Knowing what you are spending your money on every month is also a great way to realise what needs to be culled and what is necessary.

'Budgeting is a good way to show you problem areas and opportunities for saving money,' Canna adds.

3. Make a Dedicated Savings Account

Without a dedicated savings account to watch your money grow, Canna warns it is difficult to stop yourself from recklessly spending.

Designating a specific account, preferably with a nickname which mentions your goal, is a surefire way to prompt yourself to keep accumulating cash.

Canna says a savings account gives your goal direction, flow and purpose.

'A feeling of progress fuels continued commitment and dedication. Try to make sure the account is low fee or no fee at all too,' she adds.

4. Regularly Contribute

Creating a healthy routine and frequently depositing into your nest egg can excite you and encourages yourself to keep going because of how elated you feel as you watch it rise.

Creating a healthy routine and frequently depositing into your nest egg can excite you and encourages yourself to keep going because of how elated you feel as you watch it rise.

Canna also recommends putting aside every single extra dollar you may have leftover each month so your spending habits don't suffer.

'Every time you get a pay rise put the extra cash into your savings account so you aren't tempted to change your lifestyle,' she explains.

5. Remove Temptation

It may sound like a no-brainer, but removing any and all temptation to spend money from your daily routine is also an essential habit for maximum saving.

If you are inclined to duck into the shops whenever there is a sale or peruse your favourite fashion website, Canna says avoid this like the plague.

Instead, she says you should direct your free time to activities which centre around your savings goal.

'So if you are saving for a property, spend your time perusing property sites or going to open homes,' Canna suggests.

6. Review Progress Carefully

As your savings journey wears on Canna says it is good practice to review how you are tracking every so often.

It is a good idea to regularly check your account so you can feel a sense of elation or progress when you have a reasonable chunk of money.

Reviewing your progress can also give your ideas on what else you could be doing to bolster your savings or if there is any other saving opportunities.

'Little things really add up,' Canna says.

7. Reward Yourself

Lastly, Canna recommends giving yourself rewards and pit-stops every so often on your savings journey.

'We're all human beings with normal emotions, so sometimes saving can be painfully slow or painfully boring,' she said.

'But other times it can be amazing or exhilarating to give yourself a sense of achievement.'

Taking the time to reward good behavior it important but Canna also advises not to take too long of a hiatus otherwise you may fall off the bandwagon completely.

'Break down your goals into bite-size, manageable pieces and you will watch your savings grow.'

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Top seven tips for saving money and making your dollar work for YOU

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OLD age pensioners are the salt of the earth.

Most soldier on, without complaints.

They are not whingers.

Most went through hard times where seeking second-hand goods were a habit as there was no money to buy anything brand new.

They survived to become great, unheralded, true blue Australians.

Luckily in those days, the only drugs were tobacco and alcohol, not the "killers" we see on the streets today.

Now, on small pensions, they must learn how to top up those empty pockets.

Below are some tips and information that could work for you.

Be determined, be lucky.

Catalogues

First of all, don't regard the shopping catalogues that are shoved into your letterbox as junk mail. Far from it. They are valuable and your guide to cheaper shopping. We study them; make our lists and do our thrice-weekly shopping trip - what we call our "big shop".

Because the big supermarkets are grouped together, it is not physically exhausting to visit each one, if your object is to save money.

It's not a wise thing to limit all you’re shopping to one supermarket.

With the fierce competition at present with the half-price specials they offer, study each catalogue carefully and mark off the items that interest you and will benefit your pocket. Relax with a cup of tea or coffee, and a nice digestive biscuit. Be at peace but alert. If a supermarket offers you a regularly used item at half price but it's a big quantity, talk to a friend or a relative and go halves.

With these half-price specials, you are buying two for the price of one, therefore not increasing your spending.

Shopping Lists

Now write down your shopping list and set out for the shops.

Remember, if you have a certain day for your shopping and your pension is not paid the same day, you can ask Centrelink to change the day you receive the pension.

For example, we changed our pension day from a Thursday to Wednesday, to suit us.

Take it easy at the shops. Sit down in the air-conditioning, have a cup of tea or coffee and relax. Remember, this day you are saving money. Don't rush, be calm and save.

Buying Meat

Buying meat at a supermarket is not a wise option. The only advantage to you, the shopper, is that it's in the same place you buy your groceries.

The supermarket meat packages are eye-catching as they concentrate on a price point. A single piece of meat, in a small tray, could be, say, $7 but when you look at the price per kilo, it is sky high, (pop a Valium)

If you are curious, visit your local butcher and compare the price, you will be surprised.

We shop at a local butcher in Burnett St, Bundaberg, where you can buy a couple of kilos of pork spare ribs for just under $10 a kilo.

We mention shops as a guide. We do not gain financially from this. It's your choice. The same meat in a supermarket could be pushing to $20 a kilo.

We remember a time when breast of lamb, a fatty cut, was so cheap. Now one supermarket advertises this as lamb riblets. The price we are not sure on, but it must be $10 a kilo or more.

Once upon a time dog bones were free, a gesture of goodwill, from the butcher to his regular customer.

Fruit and Veg

The same principle applies to fruit and vegetables.

We shop at a greengrocer where they sell a lot of local produce, bought from nearby farmers.

Prices are very cheap on bucket lots but don't be surprised by a couple of duds.

Look at the price and save.

Shalom markets, on a Sunday morning, are where you can get bargains on fresh produce. I reckon many stallholders are farmers themselves.

But this market, besides being cheap, has a variety of goods on offer.

We buy our bread from Coles at $3 a loaf. It's an Italian-style Pane de Casa, which, when toasted with two free-range eggs, is a trip to paradise at breakfast each morning. That's our indulgence.

Weekly Menu

We find it essential to make a weekly menu.

You are able to see what you plan to eat each day, so shop for those ingredients.

If you're not making casseroles or stews, you won't need carrots, for example. Leaving carrots in the fridge for too long will make them soft.

Keep to your shopping list; don't be tempted to buy items not on your list. Also, if you make shepherd's pie or bolognaise sauce and you are only a couple or single, buy twice enough meat.

The extra portions that you make can be put in the fridge for the next day. Heated and served, it often tastes better as the sauce/pie is rested. Most importantly you have an evening off from cooking.

TV Shows

TV programs like Masterchef and MKR are okay to watch but expensive to copy.

I don't think your partner would be impressed with a small portion of something exotic with a sprig of parsley on the top.

The important thing to remember is "you are what you eat".

My wife and I eat fruit, vegetables and salads each day. Fruit and veg, or fruit and salad. When you really think, these are natural and fresh and should contain all the natural ingredients and vitamins to satisfy your body.

I know fresh and natural have sustained my body and possibly made me look a bit younger for my age. I don't need expensive anti-ageing cream, I get mine in an apple or similar.

Remember, an apple a day keeps the doctor away, and the dentist at bay.

Payments

Pensioners receive their pension every fortnight, which means there are 26 pensions in a year.

Now, instead of spending your pension every two weeks, spend it every three weeks.

Therefore, in your mind, you receive 17 pensions.

Okay, still with me?

Because it's become three weeks, that should become your main shopping day.

Obviously you will have to top up with the basics, such as milk and bread, and perhaps a beer in between main shopping days.

You will need determination to get it to work for you, otherwise be lackadaisical and you will fail.

Now because you are only using your new 17 pensions, you have what we call "nine free pensions" (your 26 fortnightly pensions have become 17 three-weekly pensions.

With those nine free pensions you can put money aside for rent, rates, power bills and holidays, which you deserve.

Also splurge on a new dress, a new took box, whatever.

We managed to save money, once the system was working, for a cruise to New Zealand. With the extra though, it's important to "kill" those big bills quickly.

But be careful with your money.

It will take a bit of time getting used to changing that fortnightly pension into a pension you start spending every three weeks.

It works very well for our household, a married couple. It's all about being strict with you and then enjoying the benefits of those nine extra pensions.

Other Ways to Save

Look at other ways to save money. Look at growing vegetables in pots if you yearn for that "younger look" and want to eat fresh. Good starters are lettuce, silverbeet and herbs if you're an inventive cook.

An herb assortment relates to your cooking requirements, so easy starters are parsley and basil.

With lettuce you buy a punnet containing, say, six seedlings. You can get those six into a big pot. Water them well, give them a nitrogen fertilizer weekly and you will harvest six lovely lettuce.

They'll cost you about 50c each. In the shops you'll pay up to $2 a lettuce, but yours is fresh from the pot and chemical free.

Another good tip is put all your gold loose change in a moneybox. Open it in December and have a very merry Christmas.

Another is, if you are a couple, open separate bank accounts away from your usual joint accounts. Use it to put the odd $5 or more into this account.

Just let it grow, don't use it.

Open the account with someone like Bendigo Bank, it's fee-free. In no time you have $100 or more, enough to take your "old dutch" out for dinner.

Health

Now a reminder to your health providers at the end of the telephone line.

The Home Doctor phone number is 13 55 66. If you have an illness of just feel crook, remember this is a free service. It's bulk-billed to Medicare, so you do not need money and they come to you.

If your mind fails you at times, like the writer, keep your scripts with your chemist. They oversee your health for free. They supply you with blister packs containing your medicines. If you are sick, many will deliver to your door.

Also remember chemists are professionals. If you occasionally question your doctor's view, medicines, the chemist is a good bloke or lady (better not say sheila) to talk to. Also they have a sense of humour, like mine.

You come out with a grin on your face. A laugh a day is a good target.

That's all folks. We hope you succeed. It took us a bit of time getting used to it, but we made it work to our benefit.

Now it's natural for us to think of 17 pensions a year and nine free ones.

Good luck.

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Five money tips to give your children before they start university

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Five money tips to give your children before they start university

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In the coming weeks, hundreds of thousands of excited 18-year-olds will be heading to university. It is daunting for both the new generation of undergraduates and their parents.

University will be a long list of firsts – and many of these will involve money. Having a bank account with an overdraft (and very likely the offer of a credit card, too) will be just the start. There will be rental contracts and deposits, student loan borrowing and, for some, the eye-opening experience of doing a grocery shop.

What is the most useful financial advice a parent or grandparent can impart? Here are five suggestions.

Basic planning

Many 18-year-olds will never have budgeted properly in their lives, and having to meet essential food, housing and other costs could come as a shock.

Helen Saxon, the chief money analyst at moneysavingexpert.com, said: “They’ll need to sit down – and maybe parents can help in these remaining weeks – and work out how much cash they’ll have coming in, including their student loan, anything parents are giving them and any earned income from work.

“If parents impart one tip to their son or daughter, make it this: don’t spend everything at the outset. They may want to join every university society, but unless they’ll be doing paid work during term the money they have at the outset needs to last.”

Ms. Saxon said it would be helpful to plan their spending in terms of weeks or months. It’s important to point out that spending on socialising is fine – and a big part of university life – but it needs to be affordable.

The allure of an overdraft

A student bank account with a 0pc overdraft can be an incredibly useful safety net. But the dangers of an overdraft – which can seem like free money – are obvious.

Ms. Saxon said treating the overdraft as a “buffer” rather than accessible funds is imperative. “That overdraft is a safety net, and needs to last all year,” she added. “While 0pc overdrafts are useful and should help with cash-flow, they should not be treated as available funds. An overdraft is a loan that must be repaid.”

Telegraph Money’s favorite student current accounts are the Santander 123 account, which pays 3pc interest on balances between £300 and £2,000, and Nationwide FlexStudent, which has an overdraft rising to £3,000 by your third year and pays 1pc on credit.

The HSBC student account is great for freebies – it comes with a £60 Amazon voucher and a year’s free membership to Amazon Prime, but pays only 1.5pc on credit balances.

Credit cards

Unless their parents are wealthy and generous, most students will have cash crises at university – and a credit card could seem the answer. It’s incredibly important, however, to make sure borrowers understand that credit isn’t interest-free in the same way as a student overdraft.

Highly organized borrowers can make use of credit cards and, by paying them off soon enough, avoid costs while benefiting from the perks – but that’s a steep ask of a student.

The HSBC Student Visa Credit Card, connected to the student account (see above) provides up to £500 of credit with an interest rate of 18.9pc. It also offers cashback on some purchases, and the chance to win NFL tickets.

The Nectar Low Rate Credit Card, offered by Sainsbury’s, has an interest rate of just 5.94pc with a credit limit of £1,200. The student can collect Nectar points too, which could help them save on the weekly shop.

Understand your student loan

Getting to grips with this controversial and complex arrangement now could help indebted graduates down the line.

In the post-2012 student loans system, those graduates earning less than £21,000 (the threshold for repayments) are charged interest at RPI, currently 3.1pc. Those earning more than £41,000 are charged RPI plus 3pc – so 6.1pc – with a sliding scale in between.

Bizarrely, the maximum possible interest applies to the debt while they are studying, meaning that it will do nothing but grow. Student debt is cancelled after 30 years of repayment, so for many the size of the ultimate borrowing will not be relevant.

Safeguard your credit rating

Numbers disclosed by Telegraph Money last month showed that the typical student has a credit score 15pc lower than the national average.

While a student loan won’t show up on a credit report, other outstanding debts do so loans and credit cards need to be managed. ClearScore, the firm behind the research, found a quarter of students have a personal loan.

A quarter of students had also admitted to defaulting on a debt – most likely a mobile phone contract – and this too can wreak havoc. Regularly spending on a credit card while paying it off can actually help a credit rating. But using it to fund their lifestyle could land them in hot water.

The easiest trap to fall into is with utility bills. Half of students reported being listed on bills alongside housemates. In most cases, providers won’t treat you as financially linked, but if you set up a joint bank account to pay bills then a default could hurt your credit rating.

Ewan Armstrong, 20, a human biosciences student at Exeter, shares his experience

I decided not to have an arranged overdraft when I started uni a year ago: I have always dreaded feeling indebted. Instead, I keep a buffer of at least £100 in my account as a self-imposed overdraft that I promise myself I will never touch.

I have friends who’ve developed the terrible habit of refusing to check their account balance. This out-of-sight, out-of-mind mindset will catch up with them in the long run. I look at my balance and account summary on the NatWest app every other day.

A recent phenomenon among students is Monzo cards. It’s a debit card but one that tells you how much you’re spending on groceries, eating out, transport or bills.

I make most of my transactions via contactless or Apple Pay on my phone. Not even needing to enter a Pin runs the risk of making it easier to spend more, and I have found myself leaving the supermarket having paid contactlessly and not knowing exactly what I’ve spent.

Even so, I think the danger of thoughtlessly paying via contactless is offset by how using cards makes it easier to track spending.

There’s a perception that students can’t or shouldn’t invest money. But without a doubt the money-related achievement I’m proudest of is finding an app called Moneybox.

It rounds your card purchases up to the nearest pound and invests the pennies into a fund depending on your stated level of risk (for example, it invests 15p after you buy an 85p coffee). It has seamlessly invested about £1 a day for me over the past year. Aside from being an easy introduction to the world of investing, finding £300 tucked away in an app is every student’s dream.

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Five money tips to give your children before they start university

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5 Money Tips to Help Your Side Hustle Succeed

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5 Money Tips to Help Your Side Hustle Succeed

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1. Maintain three to six months of savings in your account. “As a contractor or part-time worker, your income will tend to ebb and flow,” Gugliuzza says. “Having an emergency fund with enough savings to cover three to six months’ worth of your critical expenses can help ensure you can pay your bills, even during times of low employment.” Figure out what this necessary dollar amount is and make sure your bank account is ready to go before you take the full leap into the gig economy.

2. Keep a handle on your debts. As part of the gig economy, you’re still responsible for paying taxes on what you earn, and bad news: You don’t have an in-house HR or accounting department to make that happen for you. “If you’re doing contract work and don’t want taxes withheld from your pay, you’ll need to make quarterly estimated state and federal tax payments,” Gugliuzza says. You’ll save yourself a lot of stress comes tax time if you are careful to put away a portion of each payment you receive and flag it as a tax payment before you accidentally spend it. Consider reaching out to a professional now to walk you through the specifics of the tax code in the area where you live.

3. Understand how much you need to save. While you may be feeling somewhat removed from your pals who are working in more traditional jobs (go on with your bad self!), the truth is that many of your financial needs are still the same as theirs. Take some time to establish some goals for what you’ll need to save for retirement or other long-term goals. There are plenty of tools and calculators available online to help you crunch these crucial numbers on your own.

4. Investigate investment opportunities. You can still take advantage of investment opportunities, even if you’re not working in a traditional full-time job. A 529 college savings plan can help you stash away funds to further your own education (and is a good way to save for your children’s future tuition as well). You should also do your homework on IRAs, which can help you grow your retirement nest egg so you’ll be sittin’ pretty when the time comes for you to quit that side hustle life. There are a lot of misconceptions out there about IRAs — for one thing, that you need to work a corporate nine-to-five to invest in one — so be sure to do your research!

5. Seek expert advice. There’s no shame in asking for help, especially if you’re new to working in the gig economy. A financial or business adviser will be able to help you figure out what your specific goals are, and they can help you put together a plan to make them happen. An action plan like this should make it a whole lot easier for you to follow through on the other four tips — and to do it effectively.

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5 Money Tips to Help Your Side Hustle Succeed

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Money is something that individuals usually need more of but frequently find in short supply.

People worry about money.... a lot. According to the YouGov poll for the Institute of Financial Planning and National Savings and Investments in Great Britain, nearly two-thirds of respondents worried about their finances, with 43 percent saying they worried about money "more often than not." Things aren't much different in the United States, where a recent survey from Lincoln Financial Group showed that 53 percent of respondents worried about having enough money for retirement.

Taking charge of personal finances may seem like a difficult undertaking, but you don't have to make drastic lifestyle changes to grow your savings. Try these tips to save more and live a more financially-conscious life.

· Keep financial records. It's hard to determine your financial standing if you do not prioritize record-keeping. Find a method that you can stick with consistently. Some people prefer old-fashioned bookkeeping with pen and paper, while others may like the convenience of software and mobile apps. Having financial matters clearly visible in black and white can show a clear picture of how much money is coming in and how much is being spent.

· Explore auto-withdrawal and deposit. Many financial institutions offer several services to customers that can make banking and money management easier. You can set up a savings account and have money automatically deducted from your paycheck and deposited into this account. Even small deposits add up over time. You also can arrange for automatic bill pay so you don't have to worry about accruing late fees for missed payments. Check with your bank or credit union about these types of services.

· Put a change jar in your house. Change might not be popular, but it is money. Having a jar or bucket in a location of the house where you set your wallet or purse may encourage you to save that loose change for something larger. Place loose change in the jar and watch it add up. Some banks have coin-counting machines, which can make it even easier to cash in your change.

· Sign up for shop-and-earn programs. Everyone from credit card companies to major retailers offer incentives to repeat customers. These include cash-back or other perks for a percentage of the money spent on purchases. These programs equate to built-in discounts and can help you squirrel away even more money without making a conscious effort.

· Consider investing. Investing can put your money to work in exchange for a return. There are many different types of investments available. If you are an investing novice, work with a financial planner or broker who can help you find a level of risk you are comfortable with.

· Pay off debt. The earlier you can get rid of outstanding debt, the better. Put money toward high-interest loans and credit cards so you aren't paying so much in costly interest charges. Afterward, you can start saving in earnest.

Learning to take charge of personal finances early on can set you on a course for financial stability throughout your life.

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How to invest when stocks are on a high & still make money

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How to invest when stocks are on a high & still make money

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The equity market is on a high these days. The Sensex hit 31,291 on June 22 2017, rising about 17 per cent from a year ago and about 19 per cent year to date (YTD). Given the phenomenal rise, should investors continue to park funds in stocks?

Different people have different investing styles. While some follow aggressive styles with shorter investment horizons, most believe in investing for the long term with a minimum of three- to five-year outlook.

During a discussion at work, a colleague made an interesting point - his equity mutual fund SIP opened in January 2008 (the high point of that market cycle) has yielded him an annual compounded return of 12 per cent till date; he continues to hold on to the same.

While one may argue that this is no great feat as the return in absolute terms is not much to write home about, the key takeaway here for readers is that despite investing at a time when valuations and markets were at a peak, this particular investment has yielded him 1.5 times returns of what he would have otherwise got had he invested in a debt instrument at the time. That too pre-tax!

What we are trying to infer is that long-term investing works. And taking such an approach, especially now, would be the right way to go about things.

One may raise a point, the fund my colleague invested in may be one of the few that have done well over the long term, thanks to the fund manager whose wisdom allowed the unit holders to garner such returns.

While that may be true, here are some interesting data points that seem encouraging enough for an investor to take up this approach on his own.

From the market peak on January 10, 2008, the Sensex has risen by around 4.5 per cent per annum. The comparable number for the BSE500 index is about 4.8 per cent per annum. But if we look at the returns of the constituents of the BSE500 index since then (considering only 80 per cent of the index companies were listed nine-and-a-half years ago), some interesting data points can be observed.

A little less than a fourth of the stocks continue to trade below their January 10, 2008 closing levels. About 11 per cent of the stocks have given positive returns, but underperformed the BSE500 index i.e. compounded returns have been positive but less than 4.8 per cent. About 9 per cent of stocks have outperformed the BSE500 index, but have generated returns less than what they would have otherwise got through debt instruments (assumed at 8 per cent). A little more than 8 per cent of the stocks have beaten the returns on debt instrument, but have been lower than the minimum return that one should expect from Indian stocks (1.5 times of 8 per cent).

What is particularly interesting is that 48 debt instrument of the index stocks have given compounded annual returns in excess of 12 per cent. The median of this basket of stocks was a high figure of 20.8 per cent.

What does all of this point towards? Three things I believe -

First, equities have the tendency to outperform other asset classes over long periods.

Second, one should have a long-term investment horizon.

And finally, stock selection is critical.

But how should a lay investor go about doing the same?

We believe the Indian economy is at an inflection point, with strong structural changes being observed within the economy. And thus, growth levels are only going to remain firm, if not rise, going forward.

All one needs to do is weed out the companies with poor fundamentals. A simple approach one can follow is to invest in companies that have a long runway of growth: companies that possess pricing power; companies whose strong historical performances are likely to remain intact in future; companies where disruption and competitive pressures are unlikely to hamper their quality of earnings; companies that are market leaders in their respective domains.

We recommend a systematic transfer plan-like structure wherein investors can park their lump sum fund in a short term debt fund, with the funds getting systematically transferred from such accounts to directly purchase shares of the shortlisted companies on a monthly or quarterly basis, thereby allowing the investors’ idle money to work for them while making the most of the market movements.

This process also helps in keeping the market noise out in the decision making process, while allowing regular financial savings – those that would form the basis of long-term wealth creation.

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How to invest when stocks are on a high & still make money

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How to Invest When Market Volatility Picks Up

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How to Invest When Market Volatility Picks Up

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We are currently investing in an extremely noisy political and economic environment. While markets have remained remarkably subdued during recent times, it is inevitable that greater volatility will emerge. The question is: how should we respond?

As investors, our natural impulse when faced with arresting news or growing uncertainty is to react. Our instincts tell us to take action to protect portfolios or to profit from a particular outcome. This adrenaline fuelled ‘fight or flight’ response is deeply ingrained within us and exists for good evolutionary reasons as early humans who did not have these instincts were less likely to have decedents.

However, this impulse towards action causes a real challenge for investors.

There is an abundance of great research on this topic; however one of the most relevant was a study by Barber & Odean which shows a clear link between portfolio turnover and the results generated by individual investors.

Those portfolios in the highest quintile of turnover delivered returns more than a third lower than those in the lowest quintile of turnover. To say this simply, the impulse towards action is not beneficial to returns.

The Impulse to Action

Alongside the evolutionary impulse and incentives, action is also being encouraged by an array of behavioral biases that revolve around overconfidence, the rejection of opposing views and a preference to recall the recent past.

Most vividly, the ‘recency bias’ makes our recent experience easier to imagine than those experiences that are more distant. This leads us to believe that current trends will continue indefinitely. In contrast, the ‘law of small numbers’ is another behavioral trap that creates an expectation of mean-reversion in small sample sizes, thus encouraging investors to risk too much capital on positions designed to capture small market deviations.

In view of this, it is hardly surprising that most portfolios managers and advisers are far too active in their investment operations. We typically see this via increased costs and poor performance.

Overcoming the Impulse towards Action?

To get practical, there are several strategies to help overcome this impulse to action. The key is to prepare rather than react, as it is likely too late to address the impulse for action when it arises. For the portfolio manager or adviser to overcome the urge to make unnecessary changes to the portfolio, it is important to initiate the strategies beforehand. A good example of how to do this is provided by the story of Odysseus facing the Island of the Sirens as he returned from the Trojan War.

Our hero knew the encounter with Sirens was both inevitable and dangerous and so he prepared himself beforehand.

In this sense, the best preparation was education. Most clients are unaware of both their behavioral biases and the impact that those biases have on a portfolio. A basic education in behavioral science is therefore the first step, as investors who are aware of their biases are less likely to fall foul of them and more likely to be understanding of the adviser’s attempts to overcome them.

Second, one should ensure they have good navigation aids. Our biases create structure to our decision-making that results in predictable mistakes, much like a poorly drawn chart creates repeated navigation errors. In order to overcome this, we need to ensure that we use navigation tools that are fit for the job and enable us to overcome the inevitable obstacles in our path. One of the more popular ways is to create a core set of investment principles that are drawn from the observations of how great investors overcome their biases.

The third is to change the narrative of market movements. Much of the impulse to action comes from the type of investment data we consume and how we consume it. For example, many investors are drawn to recent past performance with an upward moving graph and green numbers. In contrast, red numbers and falling charts create a negative connotation. This naturally exposes us to loss aversion.

Avoid overhyped financial news and broker research designed to prompt action. Instead, one should be incentivised to focus on long-term prospective returns using a fundamental valuation framework.

By doing so, we change the itch to ‘buy high and sell low’ and turn it into a compulsion to ‘buy low and sell high’. Said another way, a rise in prices is viewed as a fall in prospective returns. While this helps address the recency bias, it also reduces exposure to the law of small numbers as most daily movements in asset prices appear to be vanishingly small in the context of a decade long return expectation.

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With $1 million to invest, do some comparison shopping and look at average costs.

I would rather have a million friends than a million dollars.--Eddie Rickenbacker

Mr. Rickenbacker is entitled to his preferences, but many of us would rather have the million dollars -- and perhaps just 10 or 20 or even 100 friends. Some of us even have a million dollars -- by having saved and invested over many years, via a lucky inheritance, or by some other means.

When you have a lot of money, you need to be sure to invest it wisely, preserving much or all of its value. That's where private asset management or an account management advisor can come in handy. It's smart to do a comparison of your options, assessing the cost and fee schedule and typical charges for each one. You may also want to invest the money on your own, with a potential focus on dividend-paying stocks, annuities, and other income-generating assets.

Here are some key ways to invest $1 million.

Private asset management or account management advisory services

One option for investing your million dollars is to let someone else do it -- or have someone tell you what to do. Lots of companies, including very possibly your own brokerage, offer wealth management services, ranging from having professionals manage your money for you to simply holding your hand and offering advice.

What they charge will vary, and if you're interested in such services, you should do some comparison shopping -- comparing not only their average fees but also the specific services offered.

Some companies' wealth management services define wealth rather specifically, seeking clients with at least several million dollars. A mere million might not let you in every door. That's OK, because many services can be rather costly, charging you 1% or 3% or more of your total assets under management each year. (Some do charge less than 0.50%, so it's well worth doing comparison shopping of typical charges.)

If you parked your million dollars with an outfit charging 1% or 2% annually, they'd be charging you $10,000 or $20,000 per year for their services. That kind of fee can sometimes be worth it, if they're delivering more than that in value, but many financial pros find it hard to outperform the overall stock market -- when you can earn the market's average return simply by investing in a low-cost broad-market index fund. Many services charge 0.25% or less per year in fees.

Be sure to also consider independent financial advisors -- especially "fee-only" ones who have few or no conflicts of interest and earn no commissions from steering you into specific investments. (You can look up such pros at www.napfa.org.) A good one can serve you quite well, reviewing your overall financial health and coming up with a plan to help you meet your financial goals, such as having sufficient retirement income. They might recommend strategies such as dividend-paying stocks or annuities -- which you can read about below.

Investing on your own

You can invest the money on your own too, of course, calling your own shots. If you're a young millionaire, you'll want your money to grow, and the stock market is where it's likely to grow the most quickly over the long run. One or more simple index funds could work well here -- ideally ones focused on the broad market, such as the S&P 500 or the total U.S. or world stock market. They will likely outperform most managed stock mutual funds. There are bond index funds, too. Even Warren Buffett recommends S&P 500 index funds for most investors.

If you're approaching retirement, you'll be most interested in preserving those million dollars, or deploying it in ways that will generate income.

Consider dividend income

Another good option for wisely investing a million dollars -- or a significant portion of it -- is to buy dividend-paying stocks. It's true that dividends are never guaranteed, but if you stick with healthy and growing companies that have a good track record of paying dividends, and you spread your money among a bunch of them, you'll likely do well over the long run.

If you park, say, $500,000 in healthy, stable, dividend-paying stocks with an overall dividend yield of 4%, you can look forward to $20,000 annually, while expecting the dividends and the stock prices to rise over time. Put the entire million dollars in the dividend payers, and you might enjoy $40,000 or more in annual income.

Just to give you an idea of what's out there, here are a few well-regarded stocks with significant dividend yields:

Invest in annuities

Another smart way to invest a million dollars (or a big portion of it) is in an annuity or two (or three). Since an annuity is only as reliable as the company paying it, it's wise to divide your annuity investment among several top-rated insurance companies, to minimize any risk.

In exchange for a big bundle of money, fixed annuities (as opposed to the more problematic variable or indexed variety) can start paying you immediately or on a deferred basis. Below are examples of the kind of income that various people might be able to secure in the form of an immediate fixed annuity in the recent economic environment. (You'll generally be offered higher payments in times of higher prevailing interest rates.)

If you have a million dollars and you take just half of it -- $500,000 -- and invest it in annuities, you could be collecting about $38,000 annually, if you're a 70-year-old man. Spend the whole million and you're looking at almost $76,000, a very respectable income in retirement, especially when complemented by Social Security.

If you're a 65-year-old couple, you could get about $28,000 in annual income for $500,000, and more than $56,000 if you spend the whole million. It might not seem worth getting a joint annuity instead of two separate single ones, but remember that when one spouse dies, the survivor will be left with a substantially lower income. A joint annuity can keep payments steady until both parties die.

If you're fortunate enough to have a million dollars, invest it wisely so that it lasts and serves you well -- perhaps even continuing to grow over time. Remember that you might opt for all of the options above, devoting a chunk of your million to each.

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Nine Tips for Creating a Smart Investment Strategy from Scratch

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Nine Tips for Creating a Smart Investment Strategy from Scratch

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Whether you are saving for a retirement that is still decades away or building a college fund for your high school student, developing a smart, diversified investment strategy to also include real estate will not happen by accident. If you want the finances of your future to be better than the finances of today, you need to work hard to make it happen.

You do not have to be a savings savant or a real estate expert to develop a smart, effective and safe investment strategy. All you need is the dedication and desire to get it done, and here are a few tips you can use to make your plan more successful.

1.       Lay out your goals. Before you start on this road, you need to know where you are going. Lay out your short-term and long-term goals and determine your investment personality. Do you prefer to flip real estate for profit or are you the type of investor that enjoys cash flow from single-family rentals?

2.      Explore your options. Know what your options are, from the retirement plan at work to an individual retirement account, IRA, or 529 plans for education. Laying out all the available pieces will make it easier to develop a comprehensive investment strategy.

3.      Pay yourself first. Instead of waiting until the end of the month and seeing how much is left to invest, put your investments first. Whether that means investing automatically in a 401(k) or 403(b) or transferring money from your checking account to ensure you have capital ready to invest in a real estate deal, paying yourself first is a winning strategy. Remember, your income is the greatest wealth generator.

4.      Be smart about diversification. Diversifying your investments should be part of your investment strategy. If you are investing for retirement and have decades to go, you can probably afford to take more risk. If you need the funds in just a few years, reducing or eliminating that risk can keep your money working without the danger of loss. Given where the real estate market is right now, I would consider a 40/40/20 strategy. My colleague Rick Melero from HIS Capital Group and I discuss this at length because it truly is a smart strategy to deploy. Forty percent of your activity should be in real estate flips, 40% of your activity should be in buying cash-flowing assets (e.g. single-family rentals) and 20% of your activity should be in high-risk, high-rewards opportunities.

5.      Keep your costs low. Investment costs can eat into your investment portfolio, so look for the lowest cost products that meet your needs. If you want to play it safe, index funds are low cost and provide exposure to a wide universe of stocks and bonds both domestically and internationally, making them excellent choices for most investors. In the real estate game, consider flipping one home and with the profit, buying two rental properties.

6.      Invest consistently. It can be scary to keep investing when the real estate market is falling, but the down years are actually the best times to buy. When the market falls, every dollar you invest buys more property, and that can make a huge difference when the market eventually recovers. Remember, this is a long-term game; don't be swayed by short-term fluctuations.

7.      Do not be a micromanager. Micromanaging your real estate investments will do nothing but increase your stress level, so avoid daily checks of your account balance. It is important to review your passive investments once or twice a year, but micromanaging your accounts will get you nowhere.

8.      Be smart about taxes. When you make money on your investments, Uncle Sam will want a cut, but there are things you can do to reduce the pain. Keeping your real estate investments in self-directed retirement accounts, which are taxed when you take the money out, is one smart way to reduce your tax bill and keep your investments growing.

9.      Ramp up your savings. Getting started is often the hardest part of investing, but once you are started, it is just as important to ramp things up. If you are currently investing 6% of your earnings into your real estate investing strategy, make it 7% next year and 8% the year after that. This escalation can give you the discipline you need to ramp up the savings over time, and that will be good news for your portfolio.

Developing a smart investment strategy will not happen by accident, but if you work hard and consistently, it will happen over time. The tips listed above can help you get started, and as your comfort level rises, you can up the ante and invest even more.

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Nine Tips for Creating a Smart Investment Strategy from Scratch

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Dividend Stock Investing Strategy – How to Choose the Best Dividend Stocks

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Dividend Stock Investing Strategy – How to Choose the Best Dividend Stocks

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Many investors find themselves experiencing extreme emotional shifts in concert with the unpredictable rises and falls that come with stock market investing. Anxiety may hit like a ton of bricks when prices fall, while excitement sets hearts racing with exhilaration when they rise.

Those who choose to invest in long-term dividends, however, will not feel this same angst as stock prices shift. These investors know that the financial success of their investment is not based on the vagaries of the market itself, but rather on the long-term success of the company. They believe that the stock price and dividend will eventually rise over the long haul, resulting in huge gains over a long period of time.

So, what type of investor should you be? Should you ride the rollercoaster of short term investing, or settle in for the long haul? Really, it’s all about your personality and financial goals. Read on for some of the how’s and why’s of long-term dividend investing.

What Is a Dividend?

When a publicly traded company earns a profit, the management generally has three choices:

1.       Reinvest the money in the company.
2.       Offer a share buyback.
3.       Offer a dividend to investors.

Frequently, fast growth companies will keep the proceeds and either reinvests their income in the long-term growth of the company or offer a share buyback. Share buybacks increase each investor’s proceeds in the future by decreasing the outstanding shares of stock.

Other companies will issue a dividend, or a share of the company’s profits, which is paid out to investors on a quarterly basis.

Long-Term Dividend Investing

Dividend stock investing does not often provide the short-term capital appreciation of hot penny stocks. Nor does it match the excitement of day trading, which during rapidly rising markets can make these investments seem like stodgy, slow money stocks. Moreover, dividend-paying securities often fall out of favor in rapidly rising bull markets, subsequently regaining a fervent following during turbulent and unpredictable markets. This is due to the relatively moderate growth nature of these securities as well as the slow compounding nature of dividends that can be achieved through a long-term, buy and hold philosophy of dividend stock investing.

However, during slow growth bear markets, more and more investors seek shelter in dividend growth stocks such as blue chip stocks. In addition, the stability that these stocks can offer makes them an attractive class of security to include as a component in any portfolio during both harsh and thriving economic times.

Now that you know what dividends are, and how they work in the market, is it the right investing route for you? Here are a few things to consider:

1. The Power of Dividends

When choosing whether or not to begin this type of investing, it is important to understand the hidden power of dividends. Take these dividend facts into account:

·         You can’t fake a dividend. Unfortunately, recent history has proven that “creative accounting” methods can be used to falsely inflate a company’s earnings per share and other valuation tools in order to falsely increase share price. Dividends offer protection from these shenanigans. Companies cannot pay out money that they do not have.
·         Dividends protect you from the downside. During a bear market, when prices of many securities fall, dividend-paying stocks actually become more attractive, as their dividend yields effectively increase. This can result in an artificial stock price floor, preventing the huge capital losses that can provoke panic selling.
·         Dividends result in more shares. Using a dividend reinvestment strategy or dividend reinvestment plan (DRIP) will result in each of those incremental payouts building commission free equity in your position, which in turn results in bigger dividend payouts the following quarter.

2. A Strategy for Investors, Not Traders

When choosing a dividend investing strategy, it is important to develop a long-term investor’s mindset. To the dividend investor, a share of stock is a living, breathing piece of a company, not solely a vehicle for capital appreciation. By looking at the investment as such, you will not be disappointed by what will likely be a slower growth rate than non-dividend-paying stocks. The most important factors in their overall investing strategies are:

1.       The long-term growth and financial prospects of the company.
2.       The current and long-term financial health of the company.
3.       The health of the company’s dividend and the ability for its payout to increase over time.
4.       Management’s treatment of investors.

3. Successful, Long-Term Investors Choose Dividends

Warren Buffett has been called a value investor. Indeed, he has historically purchased shares of companies when they are being sold at a discount to their inherent worth. But, if you review the top 10 holdings of Berkshire Hathaway, you will also find each position constitutes a dividend paying security. If dividend stocks are the investment of choice for the most successful investor in history, shouldn’t they be good enough for your personal investment portfolio? Buffet loves dividend-paying stocks because they add another, more stable form of capital appreciation above and beyond share price increases.

How to Choose the Best Dividend Stocks

As with any investment, it is imperative to do your research when choosing a dividend stock. The most important things to consider when determining the correct dividend stock for your portfolio are:

1. Long-Term Prospects

Dividend investing is a long-term investing strategy. When asked what his favorite holding period for stocks is, Warren Buffett is reputed to have replied, “Forever.” This is a dividend investor’s mindset.

As a dividend investor, you never want to sell because this ruins your long-term investing strategy. So you must carefully choose companies with the long-term staying power and ability to thrive despite economic conditions. Seek corporations that grow, regardless of external economic conditions. Even dividend investors have to sell from time to time, when the underlying business or strategy changes.

2. Financials

If you can’t read a balance sheet, research the company’s bond ratings. You want to invest in the companies with the best credit ratings (investment grade or above). If you are familiar with reading financial statements, you will want to look at all of the traditional valuation tools, including the P/E ratio, price/sales ratio, Enterprise Value/EBITDA, and book value.

The company’s outstanding debt structure will also be important to understand, as a corporation’s creditors will get paid before the shareholders in any financial downturn.

3. Management and Dividend History

Look for companies with management teams that have a reputation for being investor-friendly. Consider the management’s historical treatment of dividends and share buybacks, as well as the ability to navigate difficult financial times. Has management ever suspended or lowered its dividends? Has the company ever missed a dividend payout? Or has the company consistently grown its cash reserves and increased its dividend yield over the years?

4. Competition

If someone will be putting this company out of business in a few short years, there’s no point in owning the shares as a dividend investor. Remember, fads come and go, but excellent companies with long-term staying power have the ability to navigate difficult financial waters while emerging as a leader in their industry. Look for industry leaders with staying power.

Final Word

Long-term dividend investing can be an excellent choice if you are looking to gain big over time. While it doesn’t necessarily provide the instant gratification (or complete devastation) of short-term investing, it does promise a more stable investment strategy. Take a page out of the playbooks of big investors like Warren Buffett, think long-term, research the companies you’re investing in, and your portfolio will significantly benefit.

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Dividend Stock Investing Strategy – How to Choose the Best Dividend Stocks

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Investing in Individual Stocks – 5 Survival Techniques in a Changing Market

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Investing in Individual Stocks – 5 Survival Techniques in a Changing Market

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There are no flashing lights, no clatter of coins hitting the metal bins of slot machines, no raucous shouts of victory or envious looks when a winner hits it big. But some believe that Wall Street is no different than the Las Vegas Strip – less glamor, less glitz, but still a place for gamblers to risk all where the house has the edge.

Dr. Leon Cooperman, the noted hedge fund founder and president of Omega Advisers, Inc., warned President Obama on CNBC television that “the best capital markets in the world were turning into a casino.” And The Motley Fool, a popular newsletter for individual investors, said in November 2011 that “market volatility had become so erratic this summer that it often felt like a rigged game.”

But what does this mean to the individual investor? Is the age of analyzing and picking your own investments passé? Should you be working with a new investment strategy? Knowing how to invest today requires, at minimum, two things: an understanding of how the market has changed, and strategies for survival in the new environment.

Fundamental Changes in the Equity Markets

Beginning in the 1970s, the composition of Wall Street participants – those who worked in the industry and those who invested in corporate securities – began to change. According to the Conference Board, an internationally known independent research association, institutions (pension/profit-sharing, banks, and mutual funds) owned 19.7% of the total U.S. equity value ($166.4 billion) in 1970. But by 2009, the institutional share had grown to 50.6% ($10.2 trillion) of the total value. According to Stat Spotting, a website that tracks the identification of stock buyers and sellers, professional or institutional funds accounted for more than 88% of the volume in 2011, with retail investors being only 11%.

Investors who purchase stock in individual companies – once the source of the majority of trading volume – have become increasingly rare due to the disadvantages resulting from the transition to institutional investor dominance. In fact, top performing stocks are likely to be sold by individuals and bought by institutions. What this means is that individuals are liquidating too soon, while institutions are picking up these stocks en masse, increasing their positions, and capitalizing on the subsequent appreciation and rise in profit.

Predominance of the Institutional Investor

The decline of investors buying individual stocks is due to a number of factors, including:

·         The Attrition of Publicly Available Quality Research. The consolidation of Wall Street brokerage firms, the effect of the negotiated commissions on security trades, and the willingness and ability of large investors to purchase private equity research has resulted in a significant loss in the quality (depth) and quantity (companies covered by analysts) of free equity research available to small investors. As a result, individuals are more likely to retreat from individual stocks and invest in managed security funds than spend the personal time and energy and gain the expertise necessary to be successful as an individual investor.

·         The Rapid Adjustment of the Market to News. Theoretically, profit opportunities exist where information voids are present. These anomalies allow a knowledgable investor through independent research to have an advantage that other investors lack. However, the expansion of technology combined with worldwide communications and a sophisticated retrospective review of unusual market activity has minimized the likelihood of an information advantage.

·         The Increased Volatility of the Market. Institutions, due to their size, are generally limited to companies with large “floats” in which they can take major positions. In other words, a large number of investment companies seek to invest in the same small group of large-cap companies. This concentration creates wide variations in prices as they adjust their positions by buys and sales, often in the same periods. In addition, high frequency traders (HFTs) using technically adroit software programs constantly move in and out of the market, amplifying price movement for a series of small profits. These funds, which account for more than one-half of the daily volume, are not mutual funds buying and holding securities for investment, but short-term trading entities which capitalize on short-term price movements.

·         The Popular Acceptance of the Efficient Market Hypothesis. Market theorists have posited for years that it is extremely difficult, if not impossible, to out-perform the market on a risk-adjusted basis. This view is commonly known as the efficient market hypothesis. In other words, your expected return generally will be that of the market unless you are taking inordinate risks. That is to say, you might make $1 million by investing your retirement savingsin the shares of a new technology company, but you’re just as likely – if not more likely – to go broke. As a consequence, most investors have elected to leave investing to the professionals.

Despite the changes in the fundamental nature of the equity market, many people continue to believe in a market of stocks, rather than the stock market. They believe that good research and a fundamental, long-term approach to investing enables them to pick stocks that appreciate even if market averages go down. Others are content with the returns of the market as a whole, buying a fund that owns stocks of the same identity and proportion as in a popular benchmark index, such as DJIA or the S&P 500.

It is true that not all stocks go down or up on a single day or in any single period. There are always winners and losers. If you feel that you have the stomach, the brains, and the fortitude to thrive in this market, there are strategies that might keep you on the winning side.

Stock Investing Survival Techniques

One of the most successful investors of the modern era is Warren Buffett. Buffett recently told people at the Berkshire Hathaway annual meeting, “The beauty of stocks is that they sell at silly prices from time to time. That’s how Charlie [Munger, an early partner] and I got rich.” He has always taken a long-term perspective, sought companies that were overlooked and undervalued by the market, and exercised patience, believing that good management would deliver results that would be ultimately reflected in the stock price. There is no better example to follow if you elect to purchase stock in individual companies, rather than mutual funds.

Warren Buffett’s rules of investing include:

1. Invest in Yourself

Learn the rudiments of stock market analysis by reading and studying “Security Analysis,” a classic book written by Benjamin Graham and David Dodd in 1934 and still considered the bible for investors. Study annual reports of companies to become familiar with accounting and financial reporting, and subscribe to “The Wall Street Journal” to get a financial perspective on the nation.

2. Focus on the Long-Term and the Value of Good Management

On any given day, some industries and companies attract the attention of the public with the promise of untold riches and worldwide dominance. While the popular picks rarely deliver hoped-for profits, they often explode in price on the upside following by an equally spectacular implosion. When selecting long-term investments, consider the following:

Concentrate on industries that are stable and will remain vital to the economy into the future. Buffett’s current investment portfolio includes insurance, entertainment, railroads, and his much publicized investment into the automobile industry.

Look for companies with a long-term future in products that people use today and will continue to use tomorrow. For example, Buffett’s biggest winner has been Coca-Cola, which he purchased in 1988 and still holds. As part of his analysis, he seeks to understand the industry in which the company operates, its competitors, and the events that are likely to affect it over the next decade. The management team is important with a track record of long-term growth in profits.

Buy companies that are undervalued relative to their competition. Plenty of companies with a history of improving earnings year after year and have lower price-to-earnings or price-to-sales ratios than their competitors are being overlooked in the market. Since this condition tends to correct itself, identifying these companies can represent an opportunity for profit.

3. Diversify Your Holdings

Even an investor with the prowess of Buffett can be wrong with regards to a company or its stock price. In 2009, he admitted taking a loss of several billion dollars on ConocoPhillips when he failed to anticipate the dramatic fall in energy prices.

Spreading your risks is always a prudent course to follow. Most professionals recommend a minimum of six positions or companies, but no more than 10 due to the work necessary to remain informed. It is also wise to vary investments across industries with the expectation that a general recession will not affect all of the companies and industries in the same manner or amplitude.

4. Act like an Owner

Be sure you’re on the company’s mailing list for announcements of new products and financial results. Buy the company’s products and services, and recommend them to your friends. Attend company board meetings and other public events where the company will be present. Learn the name of the security analysts following the company, and read their analyses. Treat the investment as your company and not just as numbers on a brokerage account statement.

5. Be Patient

The market is full of examples where companies rise, fall, and rise again, demonstrating the underlying fundamentals and the value of a competent, if not outstanding, management team. Apple Inc., the company with the highest stock capitalization in the world, sold on March 1, 2002 for $21.93 per share. On March 1, 2007, the stock sold for $122.17, but fell to $78.20 by February of 2009. An investor selling at that time would have missed the stock at $621.45 during March 2012.

If the reasons you purchased a company initially remain in place, keep the investment no matter how long or how short you’ve held it. The fact that the stock price goes up and down is not justification by itself to sell or buy.

Final Word

While the stock market attracts more than its fair share of gamblers, investing doesn’t require taking extraordinary risks. Fundamental investing is based primarily on safety of principal with the knowledge that good management in an undervalued company will pay better than average returns to investors over time.

Do you use any of these principles? What has your experience been with them?

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Investing in Individual Stocks – 5 Survival Techniques in a Changing Market

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How to Find Prime Investments with Dividend-Growth Potentials

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How to Find Prime Investments with Dividend-Growth Potentials

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It is a common belief among most investment experts that the

fastest way to financial growth is to invest in long-term ventures or to set a gestation period of at least 10 years for enhancing one’s prospects for bigger revenues instead of building a portfolio of short-term assets (for example, bonds and mutual funds). Hence, experienced leaders recommend diversifying investment portfolios with top-quality stocks that pay high dividends. This strategy has proven to be an efficient approach for investors to gain high long-term revenues that can sustain a stable retirement future for them.

Remember that this investment option is suitable only for investors who can have the patience and endurance to go for the long haul and choose to invest back dividends into the firms that offer payouts. For novice dividend investors, these primary advantages of investing in dividend-paying stocks on a long-term basis:

1. Highly rewarding with a potential return of a maximum of 45% when you re-invest.
2. You stand to gain a large number of shares, resulting to greater returns when you finally retire.
3. Dividends provide a lower volatility than earning over time.
4. Companies offering dividend stocks are most often well-managed, stable businesses in their particular areas and can, therefore, sustain their operations through unpredictable market conditions.

Nevertheless, be ready to apply many approaches of investing in dividend stocks in order to maximize your opportunities to gain big returns. Visit websites or consult experts to find out other essential investing tips any dividend-growth investor should implement to enhance your portfolio’s long-term viability.

Aim for the overall return

Investing in stocks that produce high revenues does not readily bring in your expected overall returns; the process all hinges on the results of capital growth and the actual dividend outcome. However, do not give up on dividend returns. The top dividend-producing stocks have the highest payout ratios, although it also means having less money to invest back with below-average dividend growth in the future. Hence, the best strategy would be to aim for the overall return rather than aiming for high yields; this is due to the fact that dividend growth depends heavily on the future outcome and not on the present performance.

Persevere

Dividend growth has nothing to do with time; therefore, persevere as you implement your long-term strategies. Wait patiently as you hold on to your stocks over a long period of time, not panicking even when market values dip. Buying and selling on impulse could cost you more than you have to because of the burdensome expenses, such as brokerage fees and taxes; and, moreover, you lose the compounding benefits of potential returns from high-yielding dividends. Nevertheless, when stock prices decrease in times of recession, stocks offering high-quality dividends can sustain large payouts to investors. Remember that firms that consistently provide sizeable returns yearly will help you accumulate stable revenue on the long-term basis.

Well-known investment guru Jeremy Grantham was quoted by Reuters as saying this: “Be patient and keep your eyes on the light ahead…. Endure the pain in the meantime since an excellent investment will grow eventually. More often than not, individual stocks will recover; and all markets eventually do.”

Measure the risks involved

Besides persevering over the long-term, investors must also know when they have to invest and when to reduce any losses, the common qualities possessed by well-seasoned industry traders. FXCM recommends that traders must fully understand their trading personality, or, as in your situation, your investing personality. Ask yourself this: “Am I a risk-taker?” for it will show the type of investor personality you have to maintain and the best strategy to build wealth. As in all investment ventures, investing in dividend growth stocks likewise demands measuring risks and using your instincts often. All investors must learn to cut their losses and to let profits roll. Avoid the common human weakness to cling on to one’s losses and calculate early both the degree of risk and the potential returns to diminish or eliminate the effects of human emotions on your investment decisions.

Finally, it is important to stick to a well-designed strategy (meaning, the dividend income need you have set as your goal, investment approach to apply), as a dividend growth venture lends well to a systematic investment approach. From here on, you are all set to raise your investment portfolio to a higher level of performance by using these recommendations. All the best in your investment journey!

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How to Find Prime Investments with Dividend-Growth Potentials

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With the New Year with us, it is appropriate to consider your retirement savings and find out if you are benefitting at all from any applicable tax law with regard to your retirement future.

Melissa Sotudeh, a certified financial planner in Washington, D.C., offers tax-savvy advice on retirement savings.

What is the most vital aspect in retirement accounts tax-planning?

To a certain degree, you can control your income tax bracket by maximizing salary deferrals — for instance, by maxing your retirement accounts, such as 401(k) and IRA plans; hence, reducing your taxable salary. On the other hand, you can become tax-efficient when you invest money for college education, retirement or other objectives.

If you are in a lower tax bracket, take advantage of specific deductions, such as those for seeking a job or relocating for work, and tax credits, such as the education credit or the child-tax credit. Contribute to a Roth 401(k) as well, allowing you to pay lower-rate taxes today and then take out your Roth funds free of tax when you retire.

When you reach a higher tax bracket, salary deferral could be the best choice for a lower taxable income. Maximize your contributions to 401(k) or Health Savings Accounts.

Approach your investment planning as tax-efficiently as you can. This has nothing to do with tax brackets, rather, with the tax treatment of your portfolio investments. Strategies involve keeping the right investments in the right account (e.g., keeping tax-advantaged investments such as municipal bonds in a taxable account), annual tax loss harvesting and selecting funds with tax-effective features, such as low turnover ratios.

What is the most common pitfall in terms of income and tax brackets?

People do not leverage tax-advantaged savings instruments before they are phased out -- which is a common error with Roth IRAs. Although a great savings tool, your capacity to contribute starts to get phased out beyond specific earning levels. For 2017, the Roth IRA salary limits start once you begin receiving more than $118,000 ($186,000 for married, filing jointly). At the $133,000 income level ($196,000 for married, filing jointly), you are not qualified to contribute.

Likewise, not using the catch-up allowance for tax-deferred retirement accounts and HSAs, which allows you to contribute way above your retirement account when you are 50, is a big mistake. If you can, take full advantage of this chance to rev up your saving and limit your taxable salary. The catch-up contribution for retirement accounts, for instance, 401(k)s, is presently $6,000, aside from the regular $18,000 limit. It should give you a total maximum contribution of $24,000 every year for 50-above individuals.

$1,000 catch-up contributions for HSAs are permitted beginning at age 55, aside from the maximum yearly contribution of $3,400 for individuals or $6,750 for families.

What else can people do about optimizing their tax status?

Giving to charity through Donor Advised Funds is an efficient way to optimize tax management in any particular tax year. Using these funds, you will be able to give money or appreciated assets and avail of the tax deduction for your donation during the year that you contributed the amount. Nevertheless, you need not choose a recipient beneficiary for your donation within that year. You may let assets in the fund to increase in time and contribute to any 501(c)(3) charitable group any time you desire.

No matter what investment method you choose, choose the appropriate tax strategy needed to optimize investment taxes.

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Ready to become a million-dollar retiree?

Who would not want to become one?

From a recent survey conducted by Time Magazine, 1 of every 3 Americans has saved practically nothing for their retirement. And a surprising 23% of Americans -- almost a fourth -- have saved less than $10,000.

In short, a total of 56% of all Americans have saved below $10,000 for their retirement. That should be cause for great concern.

Moreover, 42% of millennials (people aged 18 to 35), unfortunately, have not started saving for retirement.

It seems that this generation is bound to commit the same mistakes that their parents and grandparents, in general, committed.

But there is hope! Building a million-dollar retirement fund is not too difficult to accomplish. With enough discipline and by following these three simple steps, anyone can be assured of a secure future.

The benefit of following these effective guidelines, aside from obtaining a million-dollar retirement fund, is that you can reach your goal earlier by seven years. Yes, that is an additional solid seven years of retiring earlier than expected to allow you to fulfill your dream of buying that vacation home, travelling around the world or just enjoying your life in the peace and comfort of your home.

If you believe that plan is for you, begin the journey this very day.

If you still have doubts as to the reliability of this claim or if you think that you will need a CEO’s salary or, perhaps, have to risk your very life to achieve that big a nest egg, you are gravely mistaken.

In reality, all you need is a salary of about $60,000 yearly in order to create a million-dollar retirement.

How? Follow the steps below:

STEP 1 – Commit a part of your yearly income into savings.

That easy! Do not follow the crowd headed for the precipice of unsecured retirement – that crowd that is about half of whom are millennials.

Planning to save a reasonable part of your salary is the initial step to attaining your niche in the millionaires’ club. Every giant undertaking starts with a small step. Trust the experiences of so many before you; unless you commit to this plan, you are most likely to lose the opportunity of gaining a million-dollar retirement fund in the future.

With your yearly $60,000 income, setting aside $5,500 or about 9% of your gross income for your retirement gets you through the initial and crucial step. Congratulate yourself for doing this!

Doing so, you would have saved $458 monthly. The best strategy is to set up an automatic draft payment which allows you to transfer your funds from a checking account toward an investment account. That will help you sustain your objective of achieving a million-dollar retirement fund.

STEP 2 — Set up a tax-advantaged Individual Retirement Account (IRA).

Get hold of this free and easy approach which allows you to trade in and out of investment securities with minimal costs. Majority of transactions will be cheaper than your favorite cup of latte at the coffee shop. Sometimes, commissions are even disregarded. Open up an IRA today if you still do not have one.

An IRA provides a viable investment instrument for creating wealth due to its deferred capital-gains tax as well as its tax-deductible annual contributions. In short, the government practically helps you become a millionaire while minimizing your income-tax expenses. At present, the minimum IRA yearly contribution is $5,500 annually ($6,500 for 50 or older individuals), right within your ballpark.

You can also make contributions on a lump-sum basis or at regular periods. The latter is a great option for leveling out fluctuations in the investment portfolio, since prices tend to become volatile within the year. The outcome will be what is called “dollar-cost averaging” of your contributions. This strategy reduces the emotional stress in your decisions with respect to your savings.

Two down and only one more to go! You may celebrate at this point.

To show you clearly what happens: Simply investing $5,500 yearly for 30 years, or a total of $165,000 principal investment, will earn you $1,036,000 in the end.

This “miracle” is possible through the compounding power of money, since compounding can generate returns, which are then invested back in order to generate more income.

The figures used -- that is, $165,000 becoming $1 million -- are based on the actual yearly return of 9.5% for the U.S. Stock market way back to the year 1927.

This simply means that on the long-term basis, investors who buy and hold on to securities that track the overall performance of the general stock market can gain a 9.5% yearly return.

But you can even do better than that! You can actually turn that same $165,000 principal investment into $3 million within the same length of time. Yes, 30 years! No, within only 23 years, in fact!

How? There is a way to do it without any additional risk on your part.

Are you really excited now? The third step is the key to gaining greater wealth at a more rapid rate.

STEP 3 — Relative Strength Investing gets you faster to your retirement goals.

The Relative Strength approach basically measures a security’s performance in relation to that of another. Although there are various means of evaluating relative strength, the primary point is that a relative strength measurement can be done on any instrument.

Relative Strength, in short, can determine the parts of the general market which are strongest and those which are weakest.

This will allow us to see what is performing below par and, therefore, guide us to invest in the parts that are performing well, increasing the potential to gain greater returns. This is how we can accelerate even more the rate of compounding.

According to a research done by Dorsey Wright & Associates, momentum methods such as Relative Strength investing have overtaken the Total Market return by 4.6%, as determined by an extensive track-record analysis.

Hence, from way back in 1929, instead of accumulating only a 9.5% annual return, focusing your investment wholly on the best-performing portions of the market would have produced a 14.1% return. Moreover, within that long period, the difference in yearly return — while appearing minimal — resulted in increased worth of a portfolio of over 66 times.

As you can see, combining the power of compounding and the advantages of Relative Strength investing can help you earn that million-dollar retirement fund!

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While we use up much of our employment income toward paying for our retirement accounts, we rarely consider what we need to do when taking it out in retirement. For example, if you have pre-tax, Roth, and taxable accounts, how much money should you take out from each account? Consider these few suggestions:

1) What is the safe amount to withdraw? Your safest choice is to only take out earnings and the principal but at present dividend yields and interest rates, not expecting to get anything beyond more or less 2% of your portfolio. It is not much for majority of people and the amount can shift and will not catch up with inflation over the long haul.

The normal rule-of-thumb is that you can securely take out about 4% of the initial value of a diversified portfolio and raise that amount to keep pace with inflation for 30 years or so. But the rule was conceived back in the 1990s when interest rates were higher and many financial experts consider the rule as passé, including the financial planner who developed it. Likewise, it does not include the possibility of you withdrawing higher amounts while you are paying a mortgage or before you begin using your pension and Social Security benefits; hence, a fixed withdrawal rate may not actually be practical at all.

The other way is to make use of a retirement calculator (you can browse for a free app online) to help you appreciate how your portfolio withdrawals might have progressed historically. Although not a certainty, if you would have endured every rolling-time event since 1871, you are bound to outlast others.

2) How are your accounts taxed? Withdrawals from a conventional pre-tax retirement account will be fully taxed as regular income. A Roth account that you have held for a minimum of 5 years and you are, say over 59½ years of age, will be offer tax-free withdrawals. Likewise, loans from cash-value life insurance and reverse mortgage payments are tax-free. In general, investments in regular taxable accounts can be taxed as long as you withdraw gains and not your principal.

3) Do you plan to buy health insurance under the Affordable Care Act? If you intend to retire prior to becoming eligible for Medicare at 65, you have to determine where you will get health insurance. One choice is under the Affordable Care Act (if it still applies) since insurance firms cannot disqualify you for pre-existing conditions and you can avail of tax credits that reduce your premiums.

Since those credits are calculated according to your taxable income, you stand to gain by delaying any withdrawals from pre-tax accounts and instead using tax-free sources or taxable accounts to reduce your taxable income and, it follows, your insurance premiums.

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Privacy Policy at Lexus Group Consultancy in Tokyo, Japan

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Privacy Policy at Lexus Group Consultancy in Tokyo, Japan

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Your privacy is very important to Lexus Group. Accordingly, we have developed this Policy in order for you to understand how Lexus Group collect, use, communicate and disclose and make use of personal information. The following outlines our privacy policy.

Before or at the time of collecting personal information, the company will identify the purposes for which information is being collected.

The company will collect and use of personal information solely with the objective of fulfilling those purposes specified by us and for other compatible purposes, unless we obtain the consent of the individual concerned or as required by law.

The company will only retain personal information as long as necessary for the fulfillment of those purposes.

The company will collect personal information by lawful and fair means and, where appropriate, with the knowledge or consent of the individual concerned.

Personal data should be relevant to the purposes for which it is to be used, and, to the extent necessary for those purposes, should be accurate, complete, and up-to-date.

The company will protect personal information by reasonable security safeguards against loss or theft, as well as unauthorized access, disclosure, copying, use or modification.

The company will make readily available to customers information about our policies and practices relating to the management of personal information.

Lexus Group are committed to conducting our business in accordance with these principles in order to ensure that the confidentiality of personal information is protected and maintained.

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Privacy Policy at Lexus Group Consultancy in Tokyo, Japan

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Lexus Group Consultancy in Tokyo, Japan on Terms and Conditions

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Lexus Group Consultancy in Tokyo, Japan on Terms and Conditions

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Terms

By accessing this web site, you are agreeing to be bound by these web site Terms and Conditions of Use, all applicable laws and regulations, and agree that you are responsible for compliance with any applicable local laws. If you do not agree with any of these terms, you are prohibited from using or accessing this site. The materials contained in this web site are protected by applicable copyright and trade mark law.

Use License

1. Permission is granted to temporarily download one copy of the materials (information or software) on Lexus Group's web site for personal, non-commercial transitory viewing only. This is the grant of a license, not a transfer of title, and under this license you may not:

modify or copy the materials;

use the materials for any commercial purpose, or for any public display (commercial or non-commercial);

attempt to decompile or reverse engineer any software contained on Lexus Group's web site;

remove any copyright or other proprietary notations from the materials; or

transfer the materials to another person or "mirror" the materials on any other server.

2. This license shall automatically terminate if you violate any of these restrictions and may be terminated by Lexus Group at any time. Upon terminating your viewing of these materials or upon the termination of this license, you must destroy any downloaded materials in your possession whether in electronic or printed format.

Disclaimer

The materials on Lexus Group's web site are provided "as is". Lexus Group makes no warranties, expressed or implied, and hereby disclaims and negates all other warranties, including without limitation, implied warranties or conditions of merchantability, fitness for a particular purpose, or non-infringement of intellectual property or other violation of rights. Further, Lexus Group does not warrant or make any representations concerning the accuracy, likely results, or reliability of the use of the materials on its Internet web site or otherwise relating to such materials or on any sites linked to this site.

Limitations

In no event shall Lexus Group or its suppliers be liable for any damages (including, without limitation, damages for loss of data or profit, or due to business interruption,) arising out of the use or inability to use the materials on Lexus Group's Internet site, even if Lexus Group or a Lexus Group authorized representative has been notified orally or in writing of the possibility of such damage. Because some jurisdictions do not allow limitations on implied warranties, or limitations of liability for consequential or incidental damages, these limitations may not apply to you.

Revisions and Errata

The materials appearing on Lexus Group's web site could include technical, typographical, or photographic errors. Lexus Group does not warrant that any of the materials on its web site are accurate, complete, or current. Lexus Group may make changes to the materials contained on its web site at any time without notice. Lexus Group does not, however, make any commitment to update the materials.

Links

Lexus Group has not reviewed all of the sites linked to its Internet web site and is not responsible for the contents of any such linked site. The inclusion of any link does not imply endorsement by Lexus Group of the site. Use of any such linked web site is at the user's own risk.

Site Terms of Use Modifications

Lexus Group may revise these terms of use for its web site at any time without notice. By using this web site you are agreeing to be bound by the then current version of these Terms and Conditions of Use.

Governing Law

Any claim relating to Lexus Group's web site shall be governed by the laws of the country of none without regard to its conflict of law provisions.

General Terms and Conditions applicable to Use of a Web Site.

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Lexus Group Consultancy in Tokyo, Japan on Terms and Conditions

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Lexus Group Consultancy in Tokyo, Japan’s Industry

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Lexus Group Consultancy in Tokyo, Japan’s Industry

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Lexus Group’ decades-long experience in the business has provided the company the privilege of collaborating with various firms from many industries. Lexus Group works as a guide to buyers and sellers and sector-confined organizations. Lexus Group have succeeded in breaking ground in other nations, thereby crossing global boundaries toward establishing business progress. As a world-class member today, we have undergone the hardest tests to our capabilities and have prevailed. The challenge of entering into many industry sectors has produced in us the ability to serve with excellence and to progress in what we do best.

The demands and processes involved in each industry are totally distinct from one another and yet similar in certain ways -- unlike in terms of transactions, methods, and specifications and yet alike in the expectation and need for unparalleled quality of service. Attaining this demands a broad perspective and understanding of the history and conditions in each industry. Our teams which consist of experts from these industries assure our customers that Lexus Group has the capability to satisfy their requirements and meet their objectives.

The foundational strength that sustains every industry management is the ability to readily adapt, create positive change, and attain success. Fast-moving markets, stiff competition, growing demands, and overthinking can serve as hindrances to growth, restricting your capacity to commit even minor errors or strategic measures. Lexus Group reduces the occurrences of such circumstances by guiding you through the intricacies of the real business world where we have operated for many years and have achieved great success in serving others.

Lexus Group Business Services

Business Process Outsourcing

Logistics

Consultancy Services

Security & Safeguarding

Facilities Management, Hard & Soft

Hiring & other HR Business Allied Services

Construction Services

Construction Equipment and Services

Infrastructure

Construction Equipment

Building Materials and Products

Financial Services & Insurance Services

Corporate finance & investment banking

Commercial banking

Asset management & private banking

Insurance brokerage

Insurance

Leasing & other specialized financing

Collection of Debts

Securities & commodities brokerage

Energy & Mining

Alternative Energy

Electric & Integrated Utilities

Coal & Non-renewable Fuels

Gas Utilities

Oil and Gas Exploration and Production

Oil and Gas Refining and Transportation

Water Utilities

Oilfield Equipment & Services

Precious Metals

Independent Power Providers

Metals & Mining

Industrials

Automotive Components & Systems Controls

Industrial Automation

Instrumentation

Motors

Hydraulics & Fluid Power

Machinery Equipment & Specialty Machines

Healthcare & Pharmaceuticals

Healthcare Services

Biotechnology & Pharmaceuticals

Medical Equipment, Devices, & Supplies

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Lexus Group Consultancy in Tokyo, Japan’s Industry

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Careers of Lexus Group Consultancy in Tokyo, Japan

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Careers of Lexus Group Consultancy in Tokyo, Japan

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Careers in Lexus Group

If you are starting out in a career or going forward in one, your primary goal is to proceed under the supervision of the best employer. Numerous successful and novice professionals have chosen Lexus Group as their initial employer to build a fruitful and lasting career. Delivering the services that produced our capabilities today demands hiring the best professionals that make up to the powerhouse that our organization has become. Lexus Group’ reputation in the industry has been established on maintaining such excellent people working with our firm.

As the firm grows, our employees grow as well. Putting in their unequalled dedicated work allows the company to exist as a strong organization. On the job, our employees perform with constant motivation, pursuing and becoming the best that they can attain and become for our clients. Supporting them with the best systems, tools and privileges that they deserve has remained our highest priority. Hence, we endeavor to establish and strengthen relations.

As we often say and practice, Lexus Group treats its employees as fellow workers and as tutors who can be relied upon to bear the truth and profess what is right. You will join a corporate milieu and business culture that provides opportunities for self-awareness and career progress. The prospects of serving the needs of people while growing as an individual will come at every bend of journey in your career.

If you can see your future as a positive and progressive experience within our organization, please contact us at careers@lexusgroup.com

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Careers of Lexus Group Consultancy in Tokyo, Japan

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Succession Planning at Lexus Group Consultancy in Tokyo, Japan

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Succession Planning at Lexus Group Consultancy in Tokyo, Japan

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Planning for Succession

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Probably, the hardest stage in managing a business is preparing for and passing on the business to another owner while maintaining business continuity through such a succession process. The essential goal required is that of determining the most qualified new owner – the individual or group who has the ability and dedication to keep the venture’s stability while at the same time enhancing and expanding the business to its greatest potential.

Likewise, it is also crucial for the original owner to come up with the proper value for the business which will provide the greatest possible benefits from the transfer. Moreover, you need to lay down the plans for achieving a continuing outlook for enhancing the business and endeavor to implement them. Possessing a highly-qualified captain at the helm with the proper specialized experience will ascertain your success; that is, a proven leader having the track-record of successful ventures in actual transitions and the abilities to implement a smooth and viable succession process.

A business transition procedure can undergo so many undesirable snags. A systematic supervision and meticulous planning, however, can provide the owner a smooth transition experience. The course of a business, even with all the proper care in planning undertaken, can be often affected by a drastic leadership or ownership. And it is usually complicated by the resistance to such a transition or change. The demand to sustain business continuity and acceptance of the new management or owner must however be achieved at the shortest possible period. Lexus Group minimizes or eliminates the succession obstacles and possible fault-lines produced by a business-shake through producing congruence among opinions and expectations.

Our Competencies involve the following:

Financial modeling, business development & planning

Guiding of board of directors and stakeholders

Valuation services

Management transitions, buy-outs, sale to third party

Business- owner strategy, plan of succession, turnover to the next generation

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Succession Planning at Lexus Group Consultancy in Tokyo, Japan

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Lexus Group Consultancy in Tokyo, Japan Valuation Services

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Lexus Group Consultancy in Tokyo, Japan Valuation Services

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One of our highly-specialized expertise teams is our valuation group which includes expert registered valuation professionals. Business valuations are crucial to the strategic steps in evaluating or handling a business, buying or disposing of assets, or resolving issues.

Valuations undergo an extremely meticulous scrutiny and assessment procedure in different supervising agencies, internal sections, officers, regulatory agencies, and public investment comptrollers. Lexus Group’s valuation professionals have undertaken so many business and IP valuations, and provide certifiable, facts-based management expertise to maintain its capability to effectively aid a client’s concerns in business ventures, securities, allied assets, and debts. Our team of experts works closely to eliminate the conflicts that usually ensue under such conditions, and provide the needed concepts, values and dedication vital to the attainment of business development.

As pioneers in going interests, fair value, insolvency, IP, tariffs, and transactional valuations, Lexus Group professionals offer meticulous, determined valuation reports and quality professional assistance. Lexus Group have the extensive industry track-record; we likewise assure you that we appreciate market conditions that are essential to evaluating intangible assets, spin-offs, equities and fixed incomes. Enough time is given to fully appreciate and assess your central business idea, fundamental assets and disciplines; and from there, we provide valuable assumptions derived from diligent assessments and supported by many years of extensive business expertise.

The valuation assistance we offer are time-tested and developed through many years of adjusting to the volatile conditions and demands of the market. You can rely on our valuation experts to deliver the following services:

Financial and Tax Valuations

Reasonable Value & Fair Market Value

Private Equity Portfolio Estimate

Goodwill and Asset Impairment Testing

Transfer Pricing

Acquisition Price Allocation

Strategic/Tactical

Intellectual Property Portfolio Evaluation

License Program Development

Joint-Venture and Partnership Contributions

Transactional Fairness

Buyer/Seller Pricing Evaluation

Due Diligence

Capital Adequacy Assessments

ESOP Deals

Solvency Advices

Negotiation Assistance

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Lexus Group Consultancy in Tokyo, Japan Valuation Services

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Exit Strategy at Lexus Group Consultancy in Tokyo, Japan

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Exit Strategy at Lexus Group Consultancy in Tokyo, Japan

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Exit Strategy | Selling Your Business

Your business, as an industrialist, is your most-valued possession. Time comes when you must make the decision to sell the business or to hand over the management to the next generation or to simply move on. Whichever step you will take, most certainly, you must exit from the scene and will require the emotional strength considering that you have worked hard yourself to achieve the highest potential for your business.

In preparing for your ultimate exit, it is vital to realize that the value of your business is usually influenced by the status of your financial standing and plans. So many people, however, often miss appreciating this fact. A stable financial strategy increases buyer confidence which will enhance your business valuation and improve chances of completing the deal.

Another consideration of vital significance is that financial investors and business dealers have more confidence in the viability of the business when a reputable third-party advisor handles the financials and strategic planning. Lexus Group will aid you in propounding the highest worth that your business rightly deserves. Lexus Group enter into the picture as a facilitator for attaining an advantageous position for your company’s viable and smooth exit.

Our assistance in this sector involves the following services:

1. Appreciate the business owner’s objectives and inner motivations

2. Create a complete exit strategy, business plans, and investment methods

3. Pinpoint exit alternatives – ideal acquirer, management takeover, or family succession

4. Determine measures to enhance the business

5. Improve financial records

6. Assist the financier or business intermediary

7. Negotiate and close the deals

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Exit Strategy at Lexus Group Consultancy in Tokyo, Japan

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Lexus Group Consultancy in Tokyo, Japan Divestitures

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Lexus Group Consultancy in Tokyo, Japan Divestitures

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Lexus Group take pride in the fact that our capability to undertake divestitures is quite in demand throughout the world. Our committed staff centers its efforts on pursuing the ultimate goal which is to achieve the greatest benefit for the client. To accomplish that, our clients must depend upon us and work closely with us. Ultimately, the clients make the decisions for their future. Lexus Group collates all available information as well as the needed resources to produce the best and highest perspective which will aid the client in coming up with the most well-informed and viable solutions.

Each step we take together with the client is properly assessed and based on facts and figures. Senior advisers take the lead in every level of the divestiture in order to assure that market conditions are propitious. From there, they proceed to the execution of the divestiture strategy which is in accordance to the specific needs and goals of our clients. Lexus Group utilize our global network of associates and our vast spectrum of deals to expand into more prospective business acquirers and thereby improve our potential for attaining the most profitable business ventures in the future. The goal is to acquire the highest blend of price potential, deal agreement, and cultural stability within prescribed time duration.

The broad spectrum of our excellent services includes the following:
·         Assessing and establishing the foundation for business valuation.
·         Categorizing and subdividing the highest potential buyers.
·         Undertake feasibility studies with focus on existing market conditions.
·         Evaluating opportunities of the sale process in a confidential and efficient way, especially in terms of coordinating with buyers, transacting with buyers’ demands, applying due diligence, and closing the structure of the sale.

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Lexus Group Consultancy in Tokyo, Japan Divestitures

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Lexus Group Consultancy in Tokyo, Japan on Private Equity and Equity Capital Markets

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Lexus Group Consultancy in Tokyo, Japan on Private Equity and Equity Capital Markets

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Equity Capital Markets

Lexus Group completely trusts the unmatched capability of its Equity Capital Markets Unit that has proven its expertise to provide proactive services that constantly benefitted customers in capital markets. A thorough comprehension of the market and the entities engaged in this sector and being likewise a competitive player in this market allows us the confidence to provide reliable advice and help in acquiring capital.

The complexity, importance and time dependency of equity capital markets can best be managed by people who have an extensive track record and know-how in dealing with various types and levels of capital market transactions in a variety of sectors.

Our specialized services are the following:

1. Buyback

2. Convertible bonds

3. Initial Public Offering

4. Follow-on Public Offering

5. Qualified Institutional Placement

6. Issues on Rights

7. Open Offer

8. Private Investment in Public Equity

Private Equity Entente

Lexus Group has an impressively wide experience when it comes to Private Equity Syndications, enduring relationships with some financial guarantors, and the capacity to handle procedures efficiently. What this track-record of fruitful transactions ultimately signifies is our special strategic management ability and a specialization expertise that provides prompt completion of complex, innovative equity transaction undertakings.

Private Equity Entente is intricate, long-drawn (usually running into several months), and requires many stages needing supervision, group evaluation, pinpointing the best investment method, collating and assessing several potential proposals from various investors, affiliating with service-providers, assuring due diligence, and consulting with shareholders in deals. Time is crucial in this regard and the goal is to determine the best provider at the least amount of time.

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Lexus Group Consultancy in Tokyo, Japan on Private Equity and Equity Capital Markets

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About Lexus Group Consultancy in Tokyo, Japan

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About Lexus Group Consultancy in Tokyo, Japan

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Excellent.Exceptional.Evolving. — This is Who We Are!

Lexus Group is proud of being an exceptional company as a result of its continuing drive to excel through its professional people and delivery of services. Achieving perfection throughout its forty-five years of operations in such tasks as Merger and Acquisition transactions, Business Valuation processes, Business Exit planning services, and Succession Planning projects, have given us the unequalled opportunity to progress into a truly unique company. Achieving the position we now hold demanded a genuinely creative and vibrant process as we faced every challenge along the way.

Our firm has evolved its procedures of discovering and providing the most efficient solution to achieve the client’s goals and create wealth within every investment potential chosen and every challenge faced. Every Lexus Group employee is trained and prepared to accomplish one primary objective: “to do what is right the right way always”. Although our company operates generally in an apparently conventional manner, we believe that in the eyes of our customers, what we do is the most efficient way. When we feel it is prudent, we would firmly, without excuses, advice holding off an acquisition or a business sale if the circumstances and potential returns are not bright. Our solemn commitment to our thousands of clients is our word that we can be trusted upon to help them secure their financial future. Our expertise and broad experience in the industry have prepared us to empower our customers to make educated and viable decisions.

Our dedicated group of some of the brightest professional consultants in the industry is fully capable of delivering unparalleled advice to our clients. Their tested, reliable know-how and character assures you that at Lexus Group you need to go nowhere else to find the solutions you need. Our stringent hiring process effectively filters out all but the industry’s best people to serve the lead as well as the tail-end of our company’s operations. We do not merely consider our applicants’ technical qualifications but their character as well; for in the end, values, ideas and principles make up the strong foundation of our organization.

Throughout the years, Lexus Group has developed its business through referrals provided by our customers, showing and proving the exceptional experience they have derived from dealing with our firm. Our identity as a company as well as our capability have been open to scrutiny and to close evaluation by the thousands of clients who have benefited from our services for many years and even to so many more who stand to gain likewise from our services in the future.

Every transaction we enter into produces these advantages for our clients:

1. We deal with Mergers and Acquisition consultancy services as a business venture, considering closely all its short-term and long-term prospects and challenges. Therefore, a business acquisition or sale will be analyzed according to its potential to provide the client’s corresponding short-term and long-term goals. How the customers can develop their business and their wealth from the start to a specified period matters greatly, not just the simple process of buying or selling a business.

2. Lexus Group considers valuations as serious matters because of the consequences that they may bring about. The results will always fall under meticulous scrutiny and investigation. The integrity of such undertakings will remain under a cloud and taken with studied hesitation. Nevertheless, having valuations undertaken by a reliable firm such as Lexus Group allows clients the advantage of having credibility on their side as to the reliability of the valuations.

3. The process involved in Business Exit & Succession Planning is of parallel significance to the commencing phases of a sale or buy procedure whether we are dealing with an acquisition or a merger, going through the proper initial stages will determine the outcome of the final stage as well, and vice versa. Leaving a business or entering into one demands the right planning and predetermined steps to undertake in order to cover any and all possible dire future challenges and risks.

Excellence in our services is founded on the following unique features of our policies and procedures:

1. Business relations founded on trust

2. Achieving 97% of the listed market price

3. Every client greatly gaining from an unsurpassed record of 95% sale success

4. Commission fees waived for particular service aspects

5. Safeguarding customer interests beginning with a stringent evaluation and selection method

6. Wealth-building merger or acquisition

7. Expertise that develops confidence in each stage of a merger or acquisition and the credibility of the results achieved

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About Lexus Group Consultancy in Tokyo, Japan

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Why Lexus Group Consultancy in Tokyo, Japan is the best Innovative Consultancy Company?

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Why Lexus Group Consultancy in Tokyo, Japan is the best Innovative Consultancy Company?

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Lexus Group is an exceptionally innovative consultancy company, incomparable to so many other world-renowned traditional consultancy firms.

We diligently serve our clients through finding long-term solutions for their primary concerns. Our customers have benefitted from Lexus Group’s reliable service, thereby attaining their companies’ objectives, utilizing our professional consultancy in Strategic Business Programs, Revenue & Income Projections, Business Valuation, Financial Recasting, and Business Exit Procedures.

At Lexus Group, you become a partner, a mentor, and a bearer of truth and right, not just an ordinary worker.

So, come and be a part of our team!

Reliable Advisory Service

What is the ultimate test for a real consultancy service? Lexus Group believes that it must be reliable and delivers long-term as well as short-term value beyond the client’s expectations.

To attain that, a counselor must have the resourceful mind in every phase of a merger or an acquisition. Partnering with a firm that possesses a continuing successful track-record of providing efficient services and stability in their business relationship can determine the outcome of any well-intentioned business strategy.

Everyone Wants to Have the Best

People always deserve and also look forward to realizing their business objectives and secure their long-term success. As such, they expect to totally rely on and engage a genuinely dependable company.

The high expectation of our clients inspires our firm to do its best in return, thus, determining how we conduct our business on a long-term. Being all consumers, we all desire to derive the higher return for entrusting our money and our future to a consulting firm.

The Final Gain is What Counts

In this industry, Lexus Group enjoys the benefit of being capable of providing due diligence for attaining the highest amount of benefit for the client.

We work not merely to accomplish a merger or complete a transaction. Our firm’s reputation rests on its ability to deliver the goals of our clients and to proceed to greater success beyond that. Our vision of leaving a legacy of success for this generation and the ones that will arise establishes Lexus Group as a special and enduring firm.

We have working for our company many professionals with expertise in Business Valuations, Mergers & Acquisitions, and Business Exit & Succession Planning, engaged in firms having a maximum value of $50M in revenues.

Lexus Group provides expert services in innovative business procedures, proactive business valuations, and timely business exit-plan, smooth transition process in succession planning services, high-gain M&A advisory services and detailed assessment of efficient business solutions.