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You could use the money to buy a couple of other (smaller) properties. Part of the rent of these properties would be used to cover the mortgage and the rest is income. | Not paying cash for a house |
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It depends on the bank. According to the Uniform Commercial Code, a bank is not obliged to pay a cheque after six months, but may do so if it wants to. § 4-404. BANK NOT OBLIGED TO PAY CHECK MORE THAN SIX MONTHS OLD. A bank is under no obligation to a customer having a checking account to pay a check, other than a certified check, which is presented more than six months after its date, but it may charge its customer's account for a payment made thereafter in good faith. Official link to UCC 4-404 As for your second question, if you stamp "void after 60 days" on your cheque; I don't have a specific answer for that part (yet). Update: I can find no specific rules about someone putting an arbitrary "void after xxx days" on their personal check. Businesess are alllowed to, but again the overriding rule seems to be that after six months it's the bank's choice, and you certainly couldn't make a cheque expire before six months, so I don't think that putting a stamp would make any difference. It's still up to the bank in the end. | Do personal checks expire? [US] |
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You will tend to find as options get closer to expiry (within 2 months of expiry) they tend to be traded more. Also the closer they are to being in the money they more they are traded. So there tends to be more demand for these options than long dated ones that are far out of the money. When there is this higher demand there is less need for a market maker to step in to assure liquidity, thus there should be no effect on the underlying stock price due to the high demand for options. I would say that market makers would mainly get involved in providing liquidity for options way out of the money and with long periods until expiry (6+ months), where there is little demand to start with and open interest is usually quite low. | Can heavy demand for options drive up or down a stock price? |
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Put £50 away as often as possible, and once it's built up to £500, invest in a stockmarket ETF. Repeat until you retire. | Shares; are they really only for the rich/investors? |
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That looks like a portfolio designed to protect against inflation, given the big international presence, the REIT presence and TIPS bonds. Not a bad strategy, but there are a few things that I'd want to look at closely before pulling the trigger. | Is the Yale/Swenson Asset Allocation Too Conservative for a 20 Something? |
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All of the provided advice is great, but a slightly different viewpoint on debt is worth mentioning. Here are the areas that you should concentrate your efforts and the (rough) order you should proceed. Much of the following is predicated upon your having a situation where you need to get out of debt, and learn to better budget and control your spending. You may already have accomplished some of these steps, or you may prioritize differently. Many people advise prioritizing contributing to a 401(k) savings plan. But with the assumption that you need advise because you have debt trouble, you are probably paying absurd interest rates, and any savings you might have will be earning much lower rates than you are paying on consumer debt. If you are already contributing, continue the plan. But remember, you are looking for advice because your financial situation is in trouble, so you need to put out the fire (your present problem), and learn how to manage your money and plan for the future. Compose a budget, comprised of the following three areas (the exact percentages are fungible, fit them to your circumstances). Here is where planning can get fun, when you have freed yourself from debt, and you can make choices that resonate with your individual goals. Once you have "put out the fire" of debt, then you should do two things at the same time. As you pay off debt (and avoid further debt), you will find that saving for both independence and retirement become easier. The average American household may have $8000+ credit card debt, and at 20-30%, the interest payments are $150-200/month, and the average car payment is nearly $500/month. Eliminate debt and you will have $500-800/month that you can comfortably allocate towards retirement. But you also need to learn (educate yourself) how to invest your money to grow your money, and earn income from your savings. This is an area where many struggle, because we are taught to save, but we are not taught how to invest, choose investments wisely and carefully, and how to decide our goals. Investing needs to be addressed separately, but you need to learn how. Live in an affordable house, and pay off your mortgage. Consider that the payment on a mortgage on even a modest $200K house is over $1000/month. Combine saving the money you would have paid towards a mortgage payment with the money you would have paid towards credit card debt or a car loan. Saving becomes easy when you are freed from these large debts. | Oversimplify it for me: the correct order of investing |
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Work on your own site is certainly not relevant here, that's just a part of your trade, not a service you provided to yourself. The business received the benefit of that work, not you. Suppose your business sold televisions. If you took a TV from stock for your own lounge, that would be included in this box because you have effectively paid yourself with a TV rather than cash. If you take a TV from stock to use as a demo model, that's part of your trade and not goods you have taken out of the business for your own use. For services provided to your dad it's less clear. As Skaty said, it depends whether it's your business providing the service, or you personally. If you gave your dad a free TV then it would be clear that you have effectively paid yourself with another TV and then given it to your dad as a gift. With services it's less clear whether you're receiving services from the business for free. You might consider how it would be treated by your employer if you weren't self-employed. If you were just applying your skills to help your dad in your free time, your employer wouldn't care. If you used your employer's equipment or facilities, or hosted his site on a server that your employer pays for, your employer would be more likely to discipline you for effectively stealing services from them, as they would if you took a TV from their warehouse for him. | Self Assessment UK - Goods and services for your own use |
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You can open an account with HSBC and use InvestDirect - their online share trading service - to trade LSE-traded shares. https://investments.hsbc.co.uk/product/9/sharedealing | Are there online brokers in the UK which don't require margin account? |
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The 'same day rule' in the UK is a rule for matching purposes only. It says that sales on any day are matched firstly with purchases made on the same day for the purposes of ascertaining any gain/loss. Hence the phrase 'bed-and-breakfast' ('b&b') when you wish to crystalise a gain (that is within the exempt amount) and re-establish a purchase price at a higher level. You do the sale on one day, just before the market closes, which gets matched with your original purchase, and then you buy the shares back the next day, just after the market opens. This is standard tax-planning. Whenever you have a paper gain, and you wish to lock that gain out of being taxed, you do a bed-and-breakfast transaction, the idea being to use up your annual exemption each and every year. Of course, if your dealing costs are high, then they may outweigh any tax saved, and so it would be pointless. For the purpose of an example, let's assume that the UK tax year is the same as the calendar year. Scenario 1. Suppose I bought some shares in 2016, for a total price of Stg.50,000. Suppose by the end of 2016, the holding is worth Stg.54,000, resulting in a paper gain of Stg.4,000. Question. Should I do a b&b transaction to make use of my Stg.11,100 annual exemption ? Answer. Well, with transaction costs at 1.5% for a round-trip trade, suppose, and stamp duty on the purchase of 0.5%, your total costs for a b&b will be Stg1,080, and your tax saved (upon some future sale date) assuming you are a 20% tax-payer is 20%x(4,000-1,080) = Stg584 (the transaction costs are deductible, we assume). This does not make sense. Scenario 2. The same as scenario 1., but the shares are worth Stg60,000 by end-2016. Answer. The total transaction costs are 2%x60,000 = 1,200 and so the taxable gain of 10,000-1,200 = 8,800 would result in a tax bill of 20%x8,800 = 1,760 and so the transaction costs are lower than the tax to be saved (a strict analysis would take into account only the present value of the tax to be saved), it makes sense to crystalise the gain. We sell some day before the tax year-end, and re-invest the very next day. Scenario 3. The same as scenario 1., but the shares are worth Stg70,000 by end-2016. Answer. The gain of 20,000 less costs would result in a tax bill for 1,500 (this is: 20%x(20,000 - 2%x70,000 - 11,100) ). This tax bill will be on top of the dealing costs of 1,400. But the gain is in excess of the annual exemption. The strategy is to sell just enough of the holding to crystallise a taxable gain of just 11,100. The fraction, f%, is given by: f%x(70,000-50,000) - 2%xf%x70,000 = 11,100 ... which simplifies to: f% = 11,100/18,600 = 59.68%. The tax saved is 20%x11,100 = 2,220, versus costs of 2%x59.58%x70,000 = 835.52. This strategy of partial b&b is adopted because it never makes sense to pay tax early ! End. | Bed and Breakfast, Same Day Capital Gains UK |
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Your asset mix should reflect your own risk tolerance. Whatever the ideal answer to your question, it requires you to have good timing, not once, but twice. Let me offer a personal example. In 2007, the S&P hit its short term peak at 1550 or so. As it tanked in the crisis, a coworker shared with me that he went to cash, on the way down, selling out at about 1100. At the bottom, 670 or so, I congratulated his brilliance (sarcasm here) and as it passed 1300 just 2 years later, again mentions how he must be thrilled he doubled his money. He admitted he was still in cash. Done with stocks. So he was worse off than had he held on to his pre-crash assets. For sake of disclosure, my own mix at the time was 100% stock. That's not a recommendation, just a reflection of how my wife and I were invested. We retired early, and after the 2013 excellent year, moved to a mix closer to 75/25. At any time, a crisis hits, and we have 5-6 years spending money to let the market recover. If a Japanesque long term decline occurs, Social Security kicks in for us in 8 years. If my intent wasn't 100% clear, I'm suggesting your long term investing should always reflect your own risk tolerance, not some short term gut feel that disaster is around the corner. | How should I prepare for the next financial crisis? |
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In the US, dividends are presently taxed at the same rates as capital gains, however selling stock could lead to less tax owed for the same amount of cash raised, because you are getting a return of basis or can elect to engage in a "loss harvesting" strategy. So to reply to the title question specifically, there are more tax "benefits" to selling stock to raise income versus receiving dividends. You have precise control of the realization of gains. However, the reason dividends (or dividend funds) are used for retirement income is for matching cash flow to expenses and preventing a liquidity crunch. One feature of retirement is that you're not working to earn a salary, yet you still have daily living expenses. Dividends are stable and more predictable than capital gains, and generate cash generally quarterly. While companies can reduce or suspend their dividend, you can generally budget for your portfolio to put a reliable amount of cash in your pocket on schedule. If you rely on selling shares quarterly for retirement living expenses, what would you have done (or how much of the total position would you have needed to sell) in order to eat during a decline in the market such as in 2007-2008? | What are the tax benefits of dividends vs selling stock |
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littleadv's first comment - check the note - is really the answer. But your issue is twofold - Every mortgage I've had (over 10 in my lifetime) allows early principal payments. The extra principal can only be applied at the same time as the regular payment. Think of it this way - only at that moment is there no interest owed. If a week later you try to pay toward only principal, the system will not handle it. Pretty simple - extra principal with the payment due. In fact, any mortgage I've had that offered a monthly bill or coupon book will have that very line "extra principal." By coincidence, I just did this for a mortgage on my rental. I make these payments through my bank's billpay service. I noted the extra principal in the 'notes' section of the virtual check. But again, the note will explicitly state if there's an issue with prepayments of principal. The larger issue is that your friend wishes to treat the mortgage like a bi-weekly. The bank expects the full amount as a payment and likely, has no obligation to accept anything less than the full amount. Given my first comment above here is the plan for your friend to do 99% of what she wishes: Tell her, there's nothing magic about bi-weekly, it's a budget-clever way to send the money, but over a year, it's simply paying 108% of the normal payment. If she wants to burn the mortgage faster, tell her to add what she wishes every month, even $10, it all adds up. Final note - There are two schools of thought to either extreme, (a) pay the mortgage off as fast as you can, no debt is the goal and (b) the mortgage is the lowest rate you'll ever have on borrowed money, pay it as slow as you can, and invest any extra money. I accept and respect both views. For your friend, and first group, I'm compelled to add - Be sure to deposit to your retirement account's matched funds to gain the entire match. $1 can pay toward your 6% mortgage or be doubled on deposit to $2 in your 401(k), if available. And pay off all high interest debt first. This should stand to reason, but I've seen people keep their 18% card debt while prepaying their mortgage. | Can a US bank prevent you from making early payments to the principal on a home mortgage? |
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The simple answer is: Where 'think' stands for "after your calculations, and guts/intuitions, and analysis", of course. | Does it make sense to buy an index ETF (e.g. S&P 500) when the index is at an all-time high? |
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Unless the amounts involved are very small, it is MUCH better to incorporate. First, incorporation gives you limited liability for your acts as an employee. As an individual, you have unlimited liability. Second, incorporating allows you to deduct (for tax purposes) the costs of doing business, including all of your health insurance, most transportation, and some meals. The exception to the rule is if the amounts you are earning are so small that they don't cover the cost of incorporating, accounting fees, etc. (a few hundred, or at most a few thousand dollars). | Which is better when working as a contractor, 1099 or incorporating? |
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TARP was ~$475 billion of loans to institutions. Loans that are to be paid back, with interest (albeit very low interest). A significant percentage of the TARP loans have been (or will be) paid back. So, the final price tag of the TARP was only a few $billion (pretty low considering the scale of the program). There is ~$10 trillion in mortgage debt outstanding. That's a much higher price tag than TARP. Secondly, paying off the mortgages = no repayment to the government as there was with TARP. The initial price tag of your plan would be ~$10 trillion, instead of a few $billion. Furthermore how does a government with >$15 trillion in debt already come up with an extra ~$10 trillion to pay off people's mortgages? Should the government go deeper into debt? Print more money and trigger inflation? (Note: Some people like to talk about a "secret bailout" by the Fed, implying that the true cost of TARP was much higher than claimed by the government. The "secret bailout" was a series of short-term low/no interest loans to banks. Because they were loans, which were paid back, my point still stands.) Some other issues to consider: Remember that the principal balance of your mortgage is only a small portion of your payments to the bank. Over 30 years, you pay a lot of $$$ in interest to the bank (that's how banks make a profit). Banks are expecting that revenue, and it is factored into their financial projections. If those revenue streams suddenly disappeared, I expect it would majorly screw the up the financial industry. Many people bought houses during the real estate boom, when housing prices were inflated far beyond the "real" value of the house. Is it right to overpay for these houses? This rewards the banks for accepting the inflated value during the appraisal process. (Loan modification forces banks to accept the "real" value of the house.) The financial crisis was triggered by people buying houses they could not afford. Should they be rewarded with a free house for making poor financial decisions? | Why can't the government simply payoff everyone's mortgage to resolve the housing crisis? |
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There are two parts to the hack you describe. One is moving to a high-cost, high-pay country to work, and the other is moving to a low-cost, low-pay country to retire. As Dilip mentioned in a comment, the first part is not so easy in many cases. You can't just take a plane to the USA and start making big bucks immediately. In the first place, it's illegal to work without special visa permissions. Even if you manage to secure that permission (or take the risk of trying to work illegally), there's no guarantee you'll get a job, let alone a high-paying one. The same is true in most other high-paying countries. As for the second part, that takes considerable willpower as well. After spending X years getting used to a country, investing time and money, you must then have the resolve to uproot your life a second time and move to another country. For the most part, countries are expensive for a reason. Even if you in principle reject the cost-benefit tradeoffs of a particular country, it can be difficult to give up some of those benefits when the time comes (e.g., trains running on time, reliable electricity, donut shops, or whatever). You might "get soft" or become co-opted by the rich-country rat race and find it difficult to extricate yourself. All of these problems are compounded if, as in many cases, you happened to start a family while in the expensive country. At the least, moving would require uprooting not just you but your family. Also, quality of education is often one of the main reasons people immigrate permanently to expensive countries. Even a person who personally would prefer to retire to a cheaper country may be unwilling to transplant their children into that country's education system. (Of course, they could wait until the children are self-supporting, but that makes the wait longer, and may result in them living far away from their children, which they may not want.) As JoeTaxpayer notes, the same reasons may work on smaller levels, even within a country. In theory it's perfectly possible to power through a brief, lucrative career in Silicon Valley and then retire to Idaho, but it doesn't seem to happen as often as the plain numbers might suggest. A simple way to put it might be that the kind of person who would be happy living in a cheap environment often cannot or will not endure a lengthy "tour of duty" in an expensive environment. Either you like the expensive environment and stay, or you leave, not as a planned lifehack, but because you realize you don't like it. | What are the downsides that prevent more people from working in high-income countries, and then retiring in low-income (and cost of living) ones? |
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A multiplex is a concession stand which happens to show movies in order to lure you into range of the smell of their popcorn. It has nothing to do with movie theater monopolies. As it was explained to me by my manager, back when I worked in a movie theater in a small Midwestern chain, for every movie, the studios take some percentage cut of gross ticket sales, varying from movie to movie. Star Wars: The Phantom Menace in 1999 was the first film for which the studio demanded 90% of gross ticket price — continuing a long-standing trend of raising the take which possibly began with the original first Star Wars movie. The other studios quickly followed suit and raised their take to 90%, especially for the big blockbusters — the textbook term is "oligopoly pricing" — and since then the percentage has inched ever closer to 100%. I forget exactly what it was on the second Matrix movie or Lord of the Rings: Return of the King, both of which premiered while I was at the theater, but the number that sticks in my head is 94%. Obviously the studios can't directly capture any revenue from the sale of popcorn — unlike the movie, it's not their product — so every time they raise their take, the theater compensates for lost revenue by raising the price of popcorn. This trend hasn't reversed with 3D and IMAX and all the new technologies coming down the pike. The only reason they're attractive to the theaters is that the theater can charge $15 a ticket rather than $10. Even on a small percentage share, that's a 50% jump in revenue, and covers the not insignificant cost of the projection equipment. 3D is also currently getting more butts in seats than 2D was, leading to somewhat more concessions sales — going to the movies is an outing and an event again — though that's tapering off as it becomes less and less of a novelty. The ticket prices aren't coming down, though. Moral of the story: like razors or printers, theaters lose a ton of money to show you movies due to studio oligopoly pricing, and make it up on popcorn. | In a competitive market, why is movie theater popcorn expensive? |
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I am currently in the process of purchasing a house. I am only putting 5% down. I see that some are saying that the traditional 20% down is the way to go. I am a first time homebuyer, and unfortunately we no longer live in the world where 20% down is mandatory, which is part of the reason why housing prices are so high. I feel it is more important that you are comfortable with what your monthly payments are as well as being informed on how interest rates can change how much you owe each month. Right now interest rates are pretty low, and it would almost be silly to put 20% down on your home. It might make more sense to put money in different vehicle right now, if you have extra, as the global economy will likely pick up and until it does, interest rates will likely stay low. Just my 2 cents worth. EDIT: I thought it would not be responsible of me not to mention that you should always have extra's saved for closing costs. They can be pricey, and if you are not informed of what they are, they can creep up on you. | For a mortgage down-payment, what percentage is sensible? |
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Have you changed how you handle fund distributions? While it is typical to re-invest the distributions to buy additional shares, this may not make sense if you want to get a little cash to use for the home purchase. While you may already handle this, it isn't mentioned in the question. While it likely won't make a big difference, it could be a useful factor to consider, potentially if you ponder how risky is it having your down payment fluctuate in value from day to day. I'd just think it is more convenient to take the distributions in cash and that way have fewer transactions to report in the following year. Unless you have a working crystal ball, there is no way to definitively predict if the market will be up or down in exactly 2 years from now. Thus, I suggest taking the distributions in cash and investing in something much lower risk like a money market mutual fund. | Is there anything I can do to prepare myself for the tax consequences of selling investments to buy a house? |
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Yes, it is, under some circumstances (basically, a piece of paper saying "John Doe borrowed Josh Shoe 100 USD" is not enough). Usually, the paper should include: This is the case for Czech Republic, I believe it's similar for other countries as well. Remember that without the repair date, you have very complicated position forcing the person to give you the money back. As well, there's a withdrawal of rights, i.e. after X years after the "repair date", you cannot force the person to give you the money. You have to send the case to the court in some period after the "repair date", if you don't have the money yet. | Is person-person lending/borrowing protected by law? |
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There are different ways of credit card purchase authorizations. if some choose less secure method it's their problem. Merchants are charged back if a stolen card is used. | Why do some online stores not ask for the 3-digit code on the back of my credit card? |
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Moving Average is mere average line based on historical period; broadly use to view the trend. But it has no relation to price action in due future course. If price is going below 20 SMA then in near future even the SMA will start directing toward south. In your case if price has fallen below all the short period average lines and long period average line then it is bearish in nature. Soon in few days you may find 20 SMA leading downwards followed by closest period and then long. Also SMA and EMA can best be observed in charting software in candlestick mode. Because these moving averages can also be adjusted and viewed based on Opening price, High prices, Low Price or closing price. In you case I guess the data is of closing price data. Overlapping of averages may be sign of reversals. So if you want to buy this stock you may have to wait till all the average lines cross-over and when new trend begins with SMA of shortest avg period (20) leading above the long avg period (90 days in your case). Then you can buy and just follow the trend. I hope it answers you question. | How do I analyse moving averages? |
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A stock represents your share of ownership in a corporation. All of these shares indicate towards your part of ownership in a corporation a shareholder, stockholder or a shareowner in a company. In order to get a stock, be sure to secure the assistance of a licensed stockbroker to buy securities on your behalf. Yes, anyone having substantial amount of money to invest can buy/own/use stocks. Holding a stock for less than a year makes it a subject to tax on your regular income for short-term gains. Most of the people find it higher than the capital gains. In addition, your annual income also comes into play. | Basic questions about investing in stocks |
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How to find good divided stocks? Research and read. Google, Yahoo, and most likely your broker offer some sort of stock screener tool where you can look for stocks with given P/E ratios, dividend payouts, pricing, and any of a number of other filters. When you've found some that appeal to you, read what others are saying on stock talk websites like Vantagewire and Stockhouse. Read what each company is putting out as news and look at their quarterly reports. In Canada you can find a company's reports for free on Sedar. I'm afraid I don't know the U.S. equivalent. Reuters will be of help. Finding a good dividend-paying stock is the same as finding a good growth or value stock; research the company and the sector as if you were buying it to take the company over. | Identifying “Dividend Stocks” |
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tl;dr It's a difference between cash and cash equivalents and net cash and cash equivalents. Download the 2016 annual report from http://www.diageo.com/en-us/investor/Pages/financialreports.aspx On page 99 is the Consolidated Statement of Cash Flows at the bottom is a section "Net cash and cash equivalents consist of:" Net cash and cash equivalents consist of: 2016-06-30 2015-06-30 Cash and cash equivalents 1,089 472 Bank overdrafts (280) (90) 809 382 The difference between net cash of 809 million and 382 million is 427 million, matching the "Change in Cash and Cash Equivalents" from Yahoo. I do not know that bank overdrafts mean in this situation, but appears to cause cash to show up on balance sheet without being reflected in the net cash portions of the cash flow statement. And the numbers seem like balances, not year of year changes like the rest of the statement of cash flows. 2015 net CCE 382 2016 cash flow + 427 ---- 2016 net CCE 809 Cash from overdrafts + 280 ---- 2015 balance sheet cash 1,089 | Change In Cash and Cash Equivalents (cash flow) vs Cash And Cash Equivalents (balance sheet) |
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The best asset allocation is one that lets you sleep well at night. Can you stomach a loss of 50% and hold on to that asset for 3 years, 5 years, or however long it will take to bounce back while everyone is telling you to sell it at a loss? All these calculations will be thrown out the window at the next market panic. You've probably been in situations where everyone's panicking and the market seems upside down and there are no rules. Most people think they'll stay rational, but unless you've been through a market panic, you don't really know how you'll react. | What is the best asset allocation for a retirement portfolio, and why? |
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SEC forms are required when declaring insider activity. An insider is defined by the SEC to be a person or entity which (i) beneficially owns 10% or more of the outstanding shares of the company, (ii) is an officer or director of the company, or (iii), in the case of insider trading, does so based on knowledge which is not otherwise publically available at the time. At any rate, the person or entity trading the stock is required to file certain forms. Form 3 is filed when a person first transitions into the status of an insider (by becoming an officer, director, or beneficial owner of a certain percentage of stock). Form 4 is filed when an existing insider trades stock under the company's symbol. Form 5 is filed when certain insider trades of small value are reported later than usual. *More information can be found at the SEC's website. Another possibility is that a large number of options or derivatives were exercised by an officer, director, or lending institution. In the cases of officers or directors, this would need to be declared with an SEC form 4. For an institution exercising warrants obtained as a result of a lending agreement, either form 3 or 4 would need to be filed. In addition to the above possibilities, username passing through pointed out a very likely scenario in his answer, as well. | Who Bought A Large Number Of Shares? |
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Bill was the founder of Microsoft, so he did indeed have a large number of shares as the company was growing exponentially. He has previously donated a large share of his fortune to the Bill and Melinda Gates foundation, so his fortune would be even greater were it not for the philanthropy. He is still a large holder of Microsoft stock at about $12B according to your link, but it wouldn't be wise to hold his entire fortune in one company, so he has diversified. You can see that his investment portfolio at Cascade includes ~$28B in Televisa and ~$7B in Berkshire Hathaway. http://www.tickerspy.com/pro/Bill-Gates---Cascade-Investment And you can keep track of whether he stays at the top by watching the bloomberg billionaires list. http://www.bloomberg.com/billionaires/ | How did Bill Gates actually make his money? |
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The interpretation is correct. The Reuters may give you the London 4PM rates if you query after the close for the day. The close rate is treated as the rate. http://uk.reuters.com/business/currencies/quote?srcAmt=1&srcCurr=GBP&destAmt=&destCurr=USD The London 4PM rate may be obtained from Bank of England at the link below; http://www.bankofengland.co.uk/mfsd/iadb/index.asp?Travel=NIxSTxTIx&levels=1&XNotes=Y&XNotes2=Y&Nodes=X3790X3791X3873X33940&SectionRequired=I&HideNums=-1&ExtraInfo=false&A3836XBMX3790X3791.x=4&A3836XBMX3790X3791.y=3 Or any other Bank that provides such data | Does Reuters provide the 4pm London Spot rate for currencies? |
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It says that you are exempt "as long as such interest income is not effectively connected with a United States trade or business". So the interest is from money earned from doing business with/through AirBnb, a US company. So you will have to report it. Even if your bank doesn't send you a 1099-INT, you have to report it, unless it is under $0.49 because the IRS allows rounding. | Does renting a room on AirBnB make all interest taxable? |
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Couple of my friends went through a fraud agent who ran off with their money and the landlords were none the wiser. So it always pays to be a bit diligent. Are they a well known letting agents nationally ? Many agents do have different accounts to manage their properties. Yours seems a case as such probably i.e. they manage the property on behalf of the landlord so keeping their monies differentiated. Did you sign an agreement ? If yes go through what is written in the agreement, most of it is same in all agreements but have a look anyway. Check if there is mention of deposit protection scheme. One thing you could do is go to a bank to do the transfer, the same bank where the letting agent holds their account and confirm from them if it is really a personal account or a business account. I am not sure how possible it is, but doesn't hurt to ask. If it is a personal account, then fraud is the most possible cause. The sort code should tell you which branch and which bank. Or the best option is to ask the estate agents to show a recent statement of the bank account, where the money is to be deposited into. Some tips | Changing Bank Account Number regularly to reduce fraud |
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You are confusing entirely unrelated things. First the "profit distribution" issue with Bob's S-Corp which is in fact tax evasion and will probably trigger a very nasty audit. Generally, if you're the sole employee of your own S-Corp, and the whole S-Corp income is from your own personal services, as defined by the IRS - there's no profit there. All the net income from such a S-Corp is subject to SE tax, either through payroll or through your K-1. Claiming anything else would be lying and IRS is notorious for going after people doing that. Second - the reclassification issue. The reason employers classify employees as contractors is to avoid payroll taxes (which the IRS gets through Bob's S-Corp, so it doesn't care) and providing benefits (that is Bob's problem, not the IRS). So in the scenario above, the IRS wouldn't care whose employee Bob is since Bob's S-Corp would have to pay all the same payroll taxes. The reclassification is an issue when employees are abused. See examples of Fedex drivers, where they're classified as contractors and are not getting any benefits, spend their own money on the truck and maintenance, etc. The employees are the ones who sued for reclassification, but in this case the IRS would be interested as well since a huge chunk of payroll taxes was not paid (driver's net is after car maintenance and payments, not before as it would be if he was salaried). So in your scenario reclassification is not as much a concern to Bob as his tax evasion scheme claiming earnings from performing personal services as "profits from S-Corp". A precedent to look at, as I mentioned elsewhere, would be the Watson v Commissioner case. | What are the consequences of IRS “reclassification” on both employer and employee? |
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Allen, welcome to Money.SE. You've stumbled into the issue of Debt Snowball, which is the "low balance" method of paying off debt. The other being "high interest." I absolutely agree that when one has a pile of cards, say a dozen, there is a psychological benefit to paying off the low balances and knocking off card after card. I am not dismissive of that motivation. Personal Finance has that first word, personal, and one size rarely fits all. For those who are numbers-oriented, it's worth doing the math, a simple spreadsheet showing the cost of the DS vs paying by rate. If that cost is even a couple hundred dollars, I'll still concede that one less payment, envelope, stamp, etc, favors the DS method. On the other hand, there's the debt so large that the best payoff is 2 or 3 years away. During that time, $10000 paid toward the 24% card is saving you $2400/yr vs the $500 if paid toward 5% debt. Hard core DSers don't even want to discuss the numbers, strangely enough. In your case, you don't have a pile of anything. The mortgage isn't even up for discussion. You have just 2 car loans. Send the $11,000 to the $19K loan carrying the 2.5%. This will save you $500 over the next 2 years vs paying the zero loan down. Once you've done that, the remaining $8000 will become your lowest balance, and you should flip to the Debt Snowball method, which will keep you paying that debt off. DS is a tool that should be pulled out for the masses, the radio audience that The David (Dave Ramsey, radio show host) appeals to. They may comprise the majority of those with high credit card debt, and have greatest success using this method. But, you exhibit none of their symptoms, and are best served by the math. By bringing up the topic here, you've found yourself in the same situation as the guy who happens to order a white wine at a wedding, and finds his Mormon cousin offering to take him to an AA meeting the next day. In past articles on this decision, I've referenced a spreadsheet one can download. It offers an easy way to see your choice without writing your own excel doc. For the situation described here, the low balance total interest is $546 vs $192 for the higher interest. Not quite the $500 difference I estimated. The $350 difference is low due to the small rate difference and relatively short payoffs. In my opinion, knowledge is power, and you can decide either way. What's important is that if you pay off the zero interest first, you can say "I knew it was a $350 difference, but I'd rather have just one outstanding loan for the remain time." My issue with DS is when it's preached like a religion, and followers are told to not even run the numbers. I wrote an article, Thinking about Dave Ramsey a number of years back, but the topic never gets old. | Do I pay a zero % loan before another to clear both loans faster? |
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I think a larger issue is that you're trying to do market timing. Whether you had a large or small amount of money to invest, no one wants to put the money in to watch it go down. You can't really predict if prices in a market or security will go up in six months (in which case you want to put all your cash in now), of if it will go down (in which case you'd want to wait until the bottom), or if it will skitter around (in which case you'd want to only buy at the bottoms). Of course, if you're magic enough to nail all of those market conditions, you're a master finance trader and will quickly make billions. If you're really concerned with protecting your money and want to take some long positions, I'd look into some put options. You'll of course pay the fees for those put options, but they'll protect your downside. Much of this depends on your time horizon: at the age of 35, someone can expect to see ~6 more recessions and perhaps ~30 more market corrections before retirement. With that big of a time range, it's best to avoid micro-optimizing since that tends to hurt your performance overall (because you won't be able to time the market correctly most of the time). One thing that's somewhat reasonable, if you have the stomach for it, is to not buy at somewhat-obvious market highs and wait for corrections. This isn't fool proof by any means, but as an example many people realized that US equities basically were on a ~5 year up run by December 2014. Many people cashed out those positions, expecting that a correction would be due. And around late summer of 2015, that correction came. For those with patience, they made ~15% with a few mouse clicks. Of course many others would have been waiting for that correction since 2010 and missed out on the market increases. Boiled down: | Strategy for investing large amount of cash |
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This refers to the faulty idea that the stock market will behave differently than it has in the past. For example, in the late 1990s, internet stocks rose to ridiculous heights in price, to be followed soon after with the Dot-Com Bubble crash. In the future, it's likely that there will be another such bubble with another hot stock - we just don't know what kind. Saying that "this time it will be different" could mean that you expect this bubble not to burst when, historically, that is never the case. | What did John Templeton mean when he said that the four most dangerous words in investing are: ‘this time it’s different'? |
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Beta is the correct answer. It is THE measure of the risk relationship of a stock with the broad market. R squared is incorrect unless you mean something very odd by "co-efficiency." A stock that goes up each time the market goes down has very low co-efficiency (negative risk as you have defined it) but very high R squared. A stock that goes the same direction as the market but twice as far (with a lot of noise) has a very low R squared but contains a lot of market risk. A stock that always goes in the same direction as the market but only a 100th as far is very safe but has a very high R squared. You can calculate beta using "slope" in excel or doing a regression, but the easiest thing is just to look up the beta in yahoo finance or elsewhere. You don't need to calculate it for yourself normally. | How to measure systematic risk of a stock? |
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The matching funds are free money, so it is a very good idea to take that money off the table. Look at it as free 100% return: you deposit $1000, your employer matches that $1000, you now have $2000 in your 401(k). (Obviously, I'm keeping things simple. Vesting schedules mean that the employer match isn't yours to keep immediately, but rather after some time; usually in chunks.) Beyond the employer match, you need to consider what is available for investment in a 401(k). Typically, your options are more limited then in an IRA. The cost of the 401(k) should be considered, as it isn't trivial for most. (The specifics will of course vary, but in large IRA accounts are cheaper.) So, it's about the opportunity costs. Up to the employer match, it doesn't matter as much that your investment choices are more limited in a 401(k), because you're getting 100% return just on the matching funds. Once that is exhausted, you have more opportunity for returns, due to having more options available to you, by going with an account that provides more choices. The overall principle here is that you have to look at the whole picture. This is similar to the notion that you should pay-down your high interest debt before investing, because from the perspective of investing the interest you're paying represent a loss, or negative return on investment, since money is going out of your accounts. Specific to your question, you have to consider the various types of investment vehicles available to you. It is not just about 401(k) and IRA accounts. You may also consider a straight brokerage account, a savings account, CDs, etc. The costs and returns that you can typically expect are your guides through the available choices. | Why should one only contribute up to the employer's match in a 401(k)? |
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I think you've got basics, but you may have the order / emphasis a bit wrong. I've changed the order of the things you've learned in to what I think is the most important to understand: Owning a stock is like owning a tiny chunk of the business Owning stock is owning a tiny chunk of the business, it's not just "like" it. The "tiny chunks" are called shares, because that is literally what they are, a share of the business. Sometimes shares are also called stocks. The words stock and share are mostly interchangeable, but a single stock normally means your holding of many shares in a business, so if you have 100 shares in 1 company, that's a stock in that company, if you then buy 100 shares in another company, you now own 2 stocks. An investor seeks to buy stocks at a low price, and sell when the price is high. Not necessarily. An investor will buy shares in a company that they believe will make them a profit. In general, a company will make a profit and distribute some or all of it to shareholders in the form of dividends. They will also keep back a portion of the profit to invest in growing the company. If the company does grow, it will grow in value and your shares will get more valuable. Price (of a stock) is affected by supply/demand, volume, and possibly company profits The price of a share that you see on a stock ticker is the price that people on the market have exchanged the share for recently, not the price you or I can buy a share for, although usually if people on the market are buying and selling at that price, someone will buy or sell from you at a similar sort of price. In theory, the price will be the companies total value, if you were to own the whole thing (it's market capitalisation) divided by the total number of shares that exist in that company. The problem is that it's very difficult to work out the total value of a company. You can start by counting the different things that it owns (including things like intellectual property and the knowledge and experience of people who work there), subtract all the money it owes in loans etc., and then make an allowance for how much profit you expect the company to make in the future. The problem is that these numbers are all going to be estimates, and different peoples estimates will disagree. Some people don't bother to estimate at all. The market makers will just follow supply and demand. They will hold a few shares in each of many companies that they are interested in. They will advertise a lower price that they are willing to buy at and a higher price that they will sell at all the time. When they hold a lot of a share, they will price it lower so that people buy it from them. When they start to run out, they will price it higher. You will never need to spend more than the market makers price to buy a share, or get less than the market makers price when you come to sell it (unless you want to buy or sell more shares than they are willing to). This is why stock price depends on supply and demand. The other category of people who don't care about the companies they are trading are the high speed traders. They just look at information like the past price, the volume (total amount of shares being exchanged on the market) and many other statistics both from the market and elsewhere and look for patterns. You cannot compete with these people - they do things like physically locate their servers nearer to the stock exchanges buildings to get a few milliseconds time advantage over their competitors to buy shares quicker than them. | As a total beginner, how do I begin to understand finance & stocks? |
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Most of it is probably due to ignorance and disbelief. A few years ago, I started doing week-long trades with my IRA. For a while I would make money each time, and over the first year I had about a 20% rate of return. If you asked me if I thought I was smarter than other people in the market, I would've told you no - I just spent more time, and most people accepted a small financial penalty for not having to spend the time directly managing their portfolio. Then I made a few poor choices, and all my previous earnings disappeared quickly. In the short term, yeah, things were great, but that didn't extrapolate out. So now that I'm a few years into investing, I'm almost entirely in index funds. | Why not just invest in the market? |
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As was once famously said, Our new Constitution is now established, and has an appearance that promises permanency; but in this world nothing can be said to be certain, except death and taxes. — Benjamin Franklin, 1789 It's very likely that either the company or you personally is going to have to pay taxes on that money. Really the only way to avoid it would be if the company spent that money on next year's expenses, and paid the bill before the end of this year. Of course you can only do that if the recipient is willing to receive their money so far in advance, which isn't necessarily the case since they would pay more taxes this year as a result. As for whether it's better to have the company pay the tax or for you to do as your accountant suggests, there are a lot of factors that go into that equation, and my gut feeling is that your accountant already ran it both ways and is suggesting the better choice. | Save money in company for next year |
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The contract he wants me to sign states I'll receive my monthly stipend (if that is the right word) as a 1099 contractor. The right word is guaranteed payment, which is what "salary" is called when a partner is working for a partnership she's a partner in. Which is exactly the case in your situation. 1099 is not the right form to report this, the partnership (LLC in your case) should be using the Schedule K-1 for that. I suggest you talk to a lawyer and a tax adviser (EA/CPA) who are licensed in your State, before you sign anything. | Being a 1099 for a company I part-own? |
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You are planning on signing a contract for, likely, hundreds of thousands of dollars, and plan on paying, likely, tens of thousands of dollars in a deposit. For a house that is not built yet. This isn't particularly unusual, lots of people do this. But, you need a lawyer. Now, before you sign anything. Your agent may be able to recommend a lawyer, but beware; your agent may have a conflict of interest here. | Is a real estate attorney needed for builder deposit contract? |
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POS stands for Point of Sale (like a specific store location) which indicates that the purchase occurred by using your debit card, but it can also be the on-line transaction done via 3-D Secure. Checking with bank, they said that Kirchstrasse transaction could be related to direct marketing subscription service ordered on-line. Investigating further what I've found these kind of transactions are performed by 2BuySafe company registered at Kirchstrasse in Liechtenstein with went through the MultiCards on-line cashier which can be used for paying different variety of services (e.g. in this case it was polish on-line storage service called Chomikuj). These kind of transactions can be tracked by checking the e-mail (e.g. in gmail by the following query: after:2014/09/02 before:2014/09/02 Order). Remember, that if you still don't recognise your transaction, you should call your bank. I have found also some other people concerns about that kind of transactions who ask: Is 2BuySafe.com and www.multicards.com some sort of Scam? Provided answer says: MultiCards Internet Billing is a provider of online credit card and debit card processing and payment solutions to many retailers worldwide. MultiCards was one of the pioneer companies offering this type of service since 1995 and is a PCI / DSS certified Internet Payment Service Provider (IPSP) providing service to hundreds of retail websites worldwide MultiCards is a registered Internet Payment Service Provider and has implemented various fraud protection tools including, but not limited to, MultiCards Fraud Score Tool and 'Verified by Visa' and 'MasterCard SecureCode' to protect card holder's card details. 2BuySafe.com Is also Secured and Verified By GeoTrust The certificate should be trusted by all major web browsers (all the correct intermediate certificates are installed). The certificate was issued by GeoTrust. Entering Incorrect information can lead to a card being rejected as @ TOS 2BuySafe.com is hosted on the Multicards Server site | What is KIRCHSTRASSE on my statement bill? |
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As Kurt Vonnegut said, the way to make money is to be there when large amounts of money are changing hands and take a little for yourself; they'll never notice. That's what transaction costs are: when a fund buys or sells stocks a bit of the money goes to the folks who handle the transaction. When you personally buy or sell stocks a bit of the money goes to the broker in the form of a fee. (and, no, no fee brokers don't work for free; they just hide the fee by not getting you the best possible price). So frequent transactions (i.e., higher portfolio turnover) mean that those little bits of money are going to the intermediaries more often. That's what "higher transaction costs" refers to -- the costs are higher than in a fund that buys and sells less often. In short, those higher transaction costs are a consequence of higher turnover; nothing nefarious there. | How does Portfolio Turnover affect my investment? |
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OK, so first of all, employers don't set up IRAs. IRA stands for Individual Retirement Account. You can set up a personal IRA for yourself, but not for employees. If that is what you're after, then just set one up for yourself - no special rules there for self employment. As far as setting up a 401(k), I'd suggest checking with benefits management companies. If you're small, you probably don't have an HR department, so managing a 401(k) yourself would likely be overly burdensome. Outsourcing this to a company which handles HR for you (maybe running payroll, etc. also), would be the best option. Barring that, I'd try calling a large financial institution (Schwab, Fidelity, etc.) for clear guidance. | As an employer, how do I start a 401k or traditional IRA plan? |
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The first thing you need to do is to set yourself a budget. Total all your money coming in (from jobs, allowances, etc.) and all your money going out (including rent, utilities, loan repayments, food, other essential and the luxuries). If your money coming in is more than your money going out, then you are onto a positive start. If on the other hand your money going out is more than the money coming in, then you are at the beginning of big trouble. You will have to do at least one of 2 things, either increase your income or reduce your expenses or both. You will have to go through all your expenses (money going out) and cut back on the luxuries, try to get cheaper alternatives for some of your essential, and get a second job or increase your hours at your current job. The aim is to always have more money coming in than the money you spend. The second thing to do is to pay off any outstanding debts by paying more than the minimum amounts and then have some savings goals. You said you wanted to save for a car - that is one saving goal. Another saving goal could be to set up a 6 month emergency fund (enough money in a separate account to be able to survive at least 6 months in case something happened, such as you lost your job or you suddenly got sick). Next you could look at getting a higher education so you can go out and get higher paying jobs. When you do get a higher paying job, the secret is not to spend all your extra money coming in on luxuries, you should treat yourself but do not go overboard. Increase the amounts you save and learn how to invest so you can get your savings to work harder for you. Building a sound financial future for yourself takes a lot of hard work and discipline, but once you do get started and change the way you do things you will find that it doesn't take long for things to start getting easier. The one thing you do have going for you is time; you are starting early and have time on your side. | How do I set up my finances when first moving out? |
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Efficient Frontier has an article from years ago about the small-cap and value premiums out there that would be worth noting here using the Fama and French data. Eugene Fama and Kenneth French (F/F) have shown that one can explain almost all of the returns of equity portfolios based on only three factors: market exposure, market capitalization (size), and price-to-book (value). Wikipedia link to the factor model which was the result of the F/F research. | What evidence or research suggests that mid- or small-capitalization stocks should perform better than large caps? |
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The balance sheet and income statements are located in the 10-K and 10-Q filings for all publicly traded companies. It will be Item 8. | How to find a public company's balance sheet and income statement? |
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Depending on your strategy, it could be though there is also something to be said for what kind of order are you placing: Market, limit or otherwise? Something else to consider is whether or not there is some major news that could cause the stock/ETF to gap at the open. For example, if a company announces strong earnings then it is possible for the stock to open higher than it did the previous day and so a market order may not to take into account that the stock may jump a bit compared to the previous close. Limit orders can be useful to put a cap on how much you'll pay for a stock though the key would be to factor this into your strategy of when do you buy. | Foolish to place orders before the market opens? |
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www.earnings.com is helpful thinkorswim's thinkDesktop platform has a lot of earnings information tied with flags on their charts they are free. | Where can I find a company's earnings history for free? |
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Indeed the IRS publication references the 3-6 year time span. And no limit for fraud. But. I get a notice that some stock I owned 10 years ago has a settlement pending, and the records of this stock purchase and sale would potentially get me back some money. I get my Social Security statement (the one they stopped sending, but this was before then) and I see the 1995 income shows zero. Both of these were easily resolved with my returns going all the way back, and my brokerage statement as well. For the brokerage, I recently started downloading all statements as PDFs, and storing a copy away from home. Less concerned about the bank statements as I've never had an issue where I'd need them. | Record retention requirements for individuals in the U.S.? |
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For any accounts where you have a wish to keep track of dividends, gains and losses, etc., you will have to set up a an account to hold the separately listed securities. It looks like you already know how to do this. Here the trading accounts will help you, especially if you have Finance:Quote set up (to pull security prices from the internet). For the actively-managed accounts, you can just create each managed account and NOT fill it with the separate securities. You can record the changes in that account in summary each month/year as you prefer. So, you might set up your chart of accounts to include these assets: And this income: The actively-managed accounts will each get set up as Type "Stock." You will create one fake security for each account, which will get your unrealized gains/losses on active accounts showing up in your trading accounts. The fake securities will NOT be pulling prices from the internet. Go to Tools -> Securities Editor -> Add and type in a name such as "Merrill Lynch Brokerage," a symbol such as "ML1," and in the "Type" field input something like "Actively Managed." In your self-managed accounts, you will record dividends and sales as they occur, and your securities will be set to get quotes online. You can follow the general GnuCash guides for this. In your too-many-transactions actively traded accounts, maybe once a month you will gather up your statements and enter the activity in summary to tie the changes in cost basis. I would suggest making each fake "share" equal $1, so if you have a $505 dividend, you buy 505 "shares" with it. So, you might have these transactions for your brokerage account with Merrill Lynch (for example): When you have finished making your period-end summary entries for all the actively-managed accounts, double-check that the share balances of your actively-managed accounts match the cost basis amounts on your statements. Remember that each fake "share" is worth $1 when you enter it. Once the cost basis is tied, you can go into the price editor (Tools -> Price Editor) and enter a new "price" as of the period-end date for each actively-managed account. The price will be "Value of Active Acct at Period-End/Cost of Active Acct at Period-End." So, if your account was worth $1908 but had a cost basis of $505 on Jan. 31, you would type "1908/505" in the price field and Jan. 31, 2017 in the date field. When you run your reports, you will want to choose the price source as "Nearest in Time" so that GnuCash grabs the correct quotes. This should make your actively-managed accounts have the correct activity in summary in your GnuCash income accounts and let them work well with the Trading Accounts feature. | How do I do double-entry bookkeeping for separately-managed investment accounts? |
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You mentioned 15-20 years in your comment on mhoran_psprep's response. This is the most important factor to consider in the points vs. rate question. With a horizon that long it sounds like the points are probably a better option for you. There is a neat comparison tool at The Mortgage Professor's website that may help you build your spreadsheet or simply check the numbers you are getting. | Calculating Future and Present value into mortgage comparisons |
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Shares often come associated with a set of rights, such as ability to vote in the outcome of the company. Some shares do not have this right, however. With your ability to vote in the outcome of the company, you could help dictate that the company paid dividends at a point in time. Or many other varieties of outcomes. Also, if there were any liquidity events due to demand of the shares, this is typically at a much higher price than the shares are now when the company is private/closely held. | What is the point of owning a stock without dividends if it cannot be resold? |
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This is one of those too good to be true things that is actually true. Why? Because only you can do this. Only you can deduct for primary home mortgage interest, only you can get a low cost mortgage (others would have to get investor mortgages at a higher interest rate). So its only a great deal for you. More people would do it if they could, but they can't, thats why you can and should do this. I have a similar setup and it is terrific. | Buying a multi-family home to rent part and live in the rest |
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I know you really like bananas, but don't you think you would get tired of them after a while? Better stock up on some kiwi and mango just to mix it up a bit. I wouldn't want to risk eating only banana sandwiches, banana ice cream and banana bread for the rest of my life. I have don't think I could take it. Same goes for mango and kiwi, but I think if I had all three I could probably get along just fine. | How to Explain “efficient frontier” to child? |
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There could be a number of reasons for a rent increase. The only information I can offer is how I calculate what rent I will charge. The minimum I would ever charge per unit (Mortgage payment + Water) / Number of units This number is the minimum because it's what I need to keep afloat. Keep in mind these are ballpark numbers The target rent ((Mortgage payment + Water) / Number of units)*1.60 I mark up the price 60% for a few reasons. First, the building needs a repair budget. That money has to come from somewhere. Second, I want to put away for my next acquisition and third I want to make a profit. These get me close to my rental price but ultimately it depends on your location and the comparables in the area. If my target rent is 600 a month but the neighbors are getting 700-800 for the same exact unit I might ask more. It also depends on the types of units. Some of my buildings, all of the units are identical. Other buildings half of the units are bigger than the other half so clearly I wouldn't charge a equal amount for them. Ultimately you have to remember we're not in the game to lose money. I know what my renters are going to pay before I even put an offer in on a building because that's how I stay in business. It might go up over the years but it will always outpace my expenses for that property. | Apartment lease renewal - is this rate increase normal? |
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Just to make this a little less vauge, I will base everything on the Mercedes Benz American Express (MB AMEX) card, which is the closest to a $100 annual fee I found on American Express's website. The benefits of a card with an annual fee generally are worth the cost if (and only if) you spend enough money on the card, and avoid paying interest to offset the benefit. Using the MB AMEX card as a reference, it offers 5X points for Mercedes Benz purchases, 3X points at gas stations, 2X points at restaurants, and 1X points everywhere else. Even if we only make purchases at the 1X rate, it only takes charging $10,000 to the card in a year in order to make up the difference. Not too hard to do on a card someone uses as their main method of payment. Every dollar spent at the higher rates only makes that easier. There are a number of other benefits as well. After spending $5,000 on the card in a year, you receive a $500 gift card towards the purchase of a Mercedes Benz car. For anyone on the market for a Mercedes Benz, the card pays for itself multiple times with just this benefit. | What's the benefit of a credit card with an annual fee, vs. a no-fee card? |
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Seems like a good deal to me. You are paying less interest over the lifetime of the loan. And what I would do is take the difference between the new payments and the old, put it into a savings account each month, and when the savings account exceeds the balance of the loan pay it off. | Is it worth it to re-finance my car loan? |
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There is a basis for that if you consider the power of compounding. So, the sooner you re-invest the dividends the sooner the time will give you results (through compounding). There is also the case of the commissions, if they are paid with a percentage of the amount invested they automatically gain more from you. Just my 2cents, though the other answers are probably more complete. | Dividends - Why the push to reinvest? |
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When is the right time to buy a new/emerging technology? When it's trading at a discount that allows you to make your money back and then some. The way you presented it, it is of course impossible to say. You have to look at exactly how much cheaper and efficient it will be, and how long that will take. Time too has a cost, and being invested has opportunity cost, so the returns must not only arrive in expected quantity but also arrive on time. Since you tagged this investing, you should look at the financial forecasts of the business, likely future price trajectories, growth opportunity and so on, and buy if you expect a return commensurate with the risk, and if the risk is tolerable to you. If you are new to investment, I would say avoid Musk, there's too much hype and speculation and their valuations are off the charts. You can't make any sensible analysis with so much emotion running wild. Find a more obscure, boring company that has a sound business plan and a good product you think is worth a try. If you read about it on mainstream news every day you can be sure it's sucker bait. Also, my impression that these panels are actually really expensive and have a snowball's chance in Arizona (heh) in a free market. Recently the market has been manipulated through green energy subsidies of a government with a strong environmentalist voter base. This has recently changed, in case you haven't heard. So the future of solar panels is looking a bit uncertain. I am thinking about buying solar panels for my roof. That's not an investment question, it's a shopping question. Do you actually need a new roof? If no, I'd say don't bother. Last I checked the payoff is very small and it takes over a decade to break even, unless you live in a desert next to the Mexican border. Many places never break even. Electricity is cheap in the United States. If you need a new roof anyway, I suppose look at the difference. If it's about the same you might as well, although it's guaranteed to be more hassle for you with the panels. Waiting makes no sense if you need a new roof, because who knows how long that will take and you need a roof now. If a solar roof appeals to you and you would enjoy having one for the price available, go ahead and get one. Don't do it for the money because there's just too much uncertainty there, and it doesn't scale at all. If you do end up making money, good for you, but that's just a small, unexpected bonus on top of the utility of the product itself. | When is the right time to buy a new/emerging technology? |
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HMRC calls it: Averaging for creators of literary or artistic works, and it is the averaging of your profits for 2 successive years. It's helpful in situations like you describe, where income can fluctuate wildly from year to year, the linked article has the full detail, but some of the requirements are: You can use averaging if: you’re self-employed or in a partnership, and the business started before 6 April 2014 and didn’t end in the 2015 to 2016 tax year your profits are wholly or mainly from literary, dramatic, musical or artistic works or from designs you or your business partner (if you’re in a partnership) created the works personally. Additionally: Check that your profit for the poorer year, minus any adjusted amounts, is less than 75% of the figure for your better year. If it is, you can use averaging. Then, check if the difference between your profits for the 2 years is more than 30% of your profit for the better year. If it is, work out the average by adding together the profits for the 2 years, and divide the total by 2. | In the UK, can authors split a single advance on a book over multiple tax returns? |
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The quickest way to approach this question is to first understand that it compares flows vs. levels. Market size is usually stated as an annual or other period figure, e.g. "The market size of refrigerators will be $10mn in 2019." This is a flow figure. Market capitalization is a level figure at any given point in time, e.g. "The market cap of the company was $20 million at the end of its last fiscal quarter." Confusion sometimes occurs when levels and flows are used loosely for comparisons. It is common for media to make statements such as "Joe Billionaire is worth more than the GDP of Roselandia." That is comparing a current level (net worth) with an annual flow (GDP). With this in mind, there are a variety of conditions where a company's equity market value will exceed its market size. The most extreme example is an innovating, development-stage enterprise, say, a biotech company, developing a new market for a new product; the current market size may be nil while the enterprise is worth something greater. The primary reason however for situations where a company's equity market cap is greater than its market size is usually that the financial market expects the enterprise (and oftentimes its market, though this isn't necessary) to grow substantially over time and hence the discounted value of the company may be greater than the current or near future market size. A final example: US annual GDP (which comprises of much more than corporate incomes and profits) for 2014 was about $17.4tn while the nation's total equity market value in 2014 was $25.1tn, both according to the World Bank. That latter figure also doesn't include the trillions of corporate debts these companies have issued so the total market cap of US, Inc. is substantially greater than $25.1tn. | What does it mean for a company to have its market cap larger than the market size? |
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(Congrats on earning/saving $3K and not wanting to blow it all on immediate gratification!) I currently have it invested in sector mutual funds but with the rise and fall of the stock market, is this really the best way to prepare long-term? Long-term? Yes! However... four years is not long term. It is, in fact, borderline short term. (When I was your age, that was incomprehensible too, but trust me: it's true.) The problem is that there's an inverse relationship between reward and risk: the higher the possible reward, the greater the risk that you'll lose a big chunk of it. I invest that middle-term money in a mix of junk high yield bond funds and "high" yield savings accounts at an online bank. My preferences are HYG purchased at Fidelity (EDIT: because it's commission-free and I buy a few hundred dollars worth every month), and Ally Bank. | How best to grow my small amount of money starting at a young age? [duplicate] |
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I'd add that bigger banks tend to have experience doing more complicated things. As an example, my local credit union (~12 offices), simply didn't have the software to wire money to a Canadian bank, as where Chase did. The Canadian routing number wasn't in the format of a US institution, and their software user interface just didn't allow for that number to be entered. Also, most smaller banks don't have international toll free (in-country) numbers for foreign access. Smaller banks also tend to have less sophisticated business banking tools and experience. If you take a Treasury bond approval to a small bank, they'll generally look at you like you have three heads. So the international side of things is definitely in the favor of big banks; they have a lot more money to dump on services. | Any reason to keep around my account with my old, 'big' bank? |
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If your business pays taxes, it is in your best interest to expense it. Even if you don't pay taxes, setting your capitalization policy low enough to capitalize an office organizer (even a nice one) will give you headaches when your business grows larger. | Expensive agenda book/organizer. Office expense or fixed asset? |
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If so, are there ways to reduce the amount of taxes owed? Given that it's currently December, I suppose I could sell half of what I want now, and the other half in January and it would split the tax burden over 2 years instead, but beyond that, are there any strategies for tax reduction in this scenario? One possibility is to also sell stocks that have gone down since you bought them. Of course, you would only do this if you have changed your mind about the stock's prospects since you bought it -- that is, it has gone down and you no longer think it will go up enough to be worth holding it. When you sell stocks, any losses you take can offset any gains, so if you sell one stock for a gain of $10,000 and another for a loss of $5,000, you will only be taxed on your net gain of $5,000. Even if you think your down stock could go back up, you could sell it to realize the loss, and then buy it back later at the lower price (as long as you're not worried it will go up in the meantime). However, you need to wait at least 30 days before rebuying the stock to avoid wash sale rules. This practice is known as tax loss harvesting. | Tax implications of diversification |
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Options can have a negligible time premium. For American1 calls the time premium is never negative. If it had a negative premium it would be profitable to exercise it immediately. A deep in the money call has a delta of exactly one. That is, it's price movements completely mirror the price movements of the underlying stock. That means an option seller can buy stock and completely hedge his short option position. The seller of the option may be in an position to buy with very little margin and take your money and invest it. For example, consider a stock trading at $7.50, with its January 2014 $4 call option trading at $3.50. For one option, representing 100 shares, a trader could take your 350 dollars and invest it, and only use a small portion of the money to buy the stock on margin. Market-makers can typically borrow money at very low interest rates. If you have high borrowing costs, or are unable to buy on margin, then buying deep in the money calls can be a good strategy. Long story short, option sellers are making money off selling these deep in the money calls even with almost zero time premium. So, in general, there's no way to make money by buying them. 1. An American call is a call that can be exercised at any time up to and including its expiration date. | Are there any investment strategies which take advantage of an in-the-money option price that incorporates no “time value”? |
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If this isn't a case where you would be willing to forgive the debt if they can't pay, it's a business transaction, not a friend transaction. Establish exactly what the interest rate will be, what the term of the loan is, whether periodic payments are required, how much is covered by those payments vs. being due at the end of the term as a balloon payment, whether they can make additional payments to reduce the principal early... Get it all in writing and signed by all concerned before any money changes hands. Consider having a lawyer review the language before signing. If the loan is large enough that it might incur gift taxes, then you may want to go the extra distance to make it a real, properly documented, intra-family loan. To do this you must charge (of at least pay taxes on) at least a certain minimal interest rate, and they have to make regular payments (or you can gift them the payments but you still won't up paying tax on the interest income). In this case you definitely want a lawyer to draw up the papers, I think. There are services on the web Antioch specialize in helping to set this up properly, and which offer services such as bookkeeping and monthly billing (aT extra cost) to make it less hassle for the lender. If the loan will be structured as a mortgage on the borrower's house -- making the interest deductible for the borrower in the US -- there are additional forms that need to be filled. The services can help with that too, for appropriate fees. Again, this probably wants experts writing the agreement, to make sure it's properly written for where you and the borrower live. Caveat: all the above is assuming USA. Rules may be very different elsewhere. I've done a formal intractability mortgage -- mostly to avoid gift tax -- and it wasn't too awful a hassle. Your mileage will vary. | Personal loan to a friend procedure |
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If there's one reasonably close to you, you could go to a no-haggle dealership. Instead of making you haggle the price downward, they just give a theoretically fixed price that's roughly what the average customer could negotiate down to at a conventional dealer. Then just do your best broken record impression if they still try to sell you dubious addons: "No. No. No. No. No..." The last time I bought a new car (06), a no haggle dealer offered the second best deal I got out of 4 dealerships visited. The one I ended up buying with made an exceptional offer on my trade (comparable to 3rd party sale bluebook value). - My guess is they had a potential customer looking for something like my old car and were hoping to resell it directly instead of flipping it via auction. | Is there any way to buy a new car directly from Toyota without going through a dealership? |
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A complete analysis of your current situation, goals, and formulating a plan to meet those goals, including discussing your risk tolerance cannot be completed during the initial meeting. The first meeting should be him trying to convince you of his skills and services, he will also be collecting the required data from you. You could inquire a few days before the meeting what information he needs from you. The less he asks for the less though the analysis at the initial meeting. This would also be a good time to ask about fee structure. Some planners make money on the initial plan, others make money on the execution of the plan. What fee that is expected for the initial analysis can vary greatly. You should ask, but most will consider this first meeting as the cost of doing business. | What can I expect to pay when meeting my first financial planner? |
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I realize that most posters are US based, but the UK on Saturday had its biggest ever payout (a miserable £60m). Because of the rules there, the estimated "value" of a £2 ticket was between £3 and £5. http://www.theguardian.com/science/2016/jan/09/national-lottery-lotto-drawing-odds-of-winning-maths | Are lottery tickets ever a wise investment provided the jackpot is large enough? |
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If I invest in index funds or other long term stocks that pay dividend which I reinvest, they don't need to be worth more per share for me to make a profit, right? That is, if I sell part of the stocks, it's GOOD if they're worth more than I bought them at, but the real money comes from the QUANTITY of stocks that you get by reinvesting your dividends, right? I would say it is more the other way around. It is nice to get dividends and reinvest them, but overall the main gain comes from the stocks going up in value. The idea with index funds, however, is that you don't rely on any particular stock going up in value; instead you just rely on the aggregate of all the funds in the index going up. By buying lots of stocks bundled in an index fund, you avoid being too reliant on any one company's performance. Can I invest "small amounts" (part of paycheck) into index funds on a monthly basis, like €500, without taking major "transaction fees"? (Likely to be index fund specific... general answers or specific answers using popular stocks welcomed). Yes, you can. At least in the US, whether you can do this automatically from your paycheck depends on whether you employer has that set up. I don't know that work in the Netherlands. However, at the least, you can almost certainly set up an auto-invest program that takes $X out of your bank account every month and buys shares of some index fund(s). Is this plan market-crash proof? My parents keep saying that "Look at 2008 and think about what such a thing would do to your plan", and I just see that it will be a setback, but ultimately irrelevant, unless it happens when I need the money. And even then I'm wondering whether I'll really need ALL of my money in one go. Doesn't the index fund go back up eventually? Does a crash even matter if you plan on holding stocks for 10 or more years? Crashes always matter, because as you say, there's always the possibility that the crash will occur at a time you need the money. In general, it is historically true that the market recovers after crashes, so yes, if you have the financial and psychological fortitude to not pull your money out during the crash, and to ride it out, your net worth will probably go back up after a rough interlude. No one can predict the future, so it's possible for some unprecedented crisis to cause an unprecedented crash. However, the interconnectedness of stock markets and financial systems around the world is now so great that, were such a no-return crash to occur, it would probably be accompanied by the total collapse of the whole economic system. In other words, if the stock market dies suddenly once and for all, the entire way of life of "developed countries" will probably die with it. As long as you live in such a society, you can't really avoid "gambling" that it will continue to exist, so gambling on there not being a cataclysmic market crash isn't much more of a gamble. Does what I'm planning have similarities with some financial concept or product (to allow me to research better by looking at the risks of that concept/product)? Maybe like a mortgage investment plan without the bank eating your money in between? I'm not sure what you mean by "what you're planning". The main financial products relevant to what you're describing are index funds (which you already mentioned) and index ETFs (which are basically similar with regard to the questions you're asking here). As far as concepts, the philosophy of buying low-fee index funds, holding them for a long time, and not selling during crashes, is essentially that espoused by Jack Bogle (not quite the inventor of the index fund, but more or less its spiritual father) and the community of "Bogleheads" that has formed around his ideas. There is a Bogleheads wiki with lots of information about the details of this approach to investing. If this strategy appeals to you, you may find it useful to read through some of the pages on that site. | Can I make my savings keep in check with or beat inflation over a long time period via index funds? |
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HSBC, Hang Seng, and other HK banks had a series of special savings account offers when I lived in HK a few years ago. Some could be linked to the performance of your favorite stock or country's stock index. Interest rates were higher back then, around 6% one year. What they were effectively doing is taking the interest you would have earned and used it to place a bet on the stock or index in question. Technically, one way this can be done, for instance, is with call options and zero coupon bonds or notes. But there was nothing to strategize with once the account was set up, so the investor did not need to know how it worked behind the scenes... Looking at the deposit plus offering in particular, this one looks a little more dangerous than what I describe. See, now we are in an economy of low almost zero interest rates. So to boost the offered rate the bank is offering you an account where you guarantee the AUD/HKD rate for the bank in exchange for some extra interest. Effectively they sell AUD options (or want to cover their own AUD exposures) and you get some of that as extra interest. Problem is, if the AUD declines, then you lose money because the savings and interest will be converted to AUD at a contractual rate that you are agreeing to now when you take the deposit plus account. This risk of loss is also mentioned in the fine print. I wouldn't recommend this especially if the risks are not clear. If you read the fine print, you may determine you are better off with a multicurrency account, where you can change your HK$ into any currency you like and earn interest in that currency. None of these were "leveraged" forex accounts where you can bet on tiny fluctuations in currencies. Tiny being like 1% or 2% moves. Generally you should beware anything offering 50:1 or more leverage as a way to possibly lose all of your money quickly. Since you mentioned being a US citizen, you should learn about IRS form TD F 90-22.1 (which must be filed yearly if you have over $10,000 in foreign accounts) and google a little about the "foreign account tax compliance act", which shows a shift of the government towards more strict oversight of foreign accounts. | HSBC Hong Kong's “Deposit Plus” Product: What is it, and what strategies to employ? |
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The SCHUFA explicitly says on their website that their scoring system is a secret. However, if your goal is to be credit-worthy for example to get financing for a house or a car or whatever, just pay any loans and your credit card back on time and you'll be fine. There is no need to build a credit history. I just got a mortgage on a new house without any real credit history. I have one credit card which I only use on vacations because some countries don't take my debit card, and I always put money on it before I use it, so I've technically never borrowed money from a bank at all. My banker looked at my SCHUFA with me and we saw that there was nothing in there except for the credit card, which has a 500€ limit and if I maxed it out, the monthly interest would be 6,80€ so he added that 6,80€ to my expenses calculation and that was it. If you're having trouble getting a loan and you don't know why, you can ask the SCHUFA for the data they have on you and you can correct any mistakes they might have made. Sometimes, especially when you have the same full name and birth date as somebody else, the SCHUFA does get things mixed up and you have to sort it out. | Credit rating in Germany |
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During the day, market and limit orders are submitted at any time by market participants and there is a bid and an ask that move around over time. Trades occur whenever a market order is submitted or a limit order is submitted that at a price that matches or exceeds an existing limit order. If you submit a market order, it may consume all best-price limit orders and you can get multiple prices, changing the bid or ask at the same time. All that stuff happens during the trading day only. What happens at the end of the day is different. A bunch of orders that were submitted during the day but marked as "on close" are aggregated with any outstanding limit orders to create a single closing price according to the algorithm established by the exchange. Each exchange may handle the details of this closing event differently. For example, the Nasdaq's closing cross or the NYSE's closing auction. The close is the most liquid time of the day, so investors who are trading large amounts and not interested in intraday swings will often submit a market-on-close or limit-on-close order. This minimizes their chance of affecting the price or crossing a big spread. It's actually most relevant for smaller stocks, which may have too little volume during the day to make big trades, but have plenty at the close. In short, the volume you see is due to these on-close orders. The spike in volume most likely has no special information about what will happen overnight or the next day. It's probably just a normal part of the market for illiquid stocks. | Market Close Order |
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My beef with day (and to ape Yishai's answer a little) is that his good advice is no different than anybody's good advice. The seven steps are on the home page, Clark Howard, Suze Orman and probably quite a few others all chat about spend less, save more, shop wisely and live within your means. Anything specific is just motivation, and it sort of irks me that Dave Ramsey charges $100+ buck to go to a seminar about how to save money. A $30 book to read anecdotes and examples of how to follow the seven steps. (Probably, I won't buy his books) I have no problem with somebody making money, but I doubt that Dave is just barely breaking even. I was stand corrected if he is, but I just don't suspect he is. Clark Howard recommends that people go to the library and check out his book; he is a lot closer to practicing what he is preaching. | Hearing much about Dave Ramsey. Which of his works is best in describing his “philosophy” about money? |
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Do yourself a favor: calculate the price of airfare, calculate how many points it takes to get a good flight, and calculate how many points you get per dollar spent. What you will find is that it is a ripoff. Leave the card at home and unlink it from your online purchasing accounts. You're welcome. If you really want to earn rewards, just put your necessary bills on that card. Over time it will accumulate, but do the math first so you can weigh the consequences. | Trouble sticking to a budget when using credit cards for day to day transactions? |
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For instance and to give a comparison to the US - in Austria, almost everybody gets a credit card (without a credit history (e.g. a young person) / with a bad credit history & with a good credit history). The credit history is in the USA much more important than in Austria. In future, the way to assess a credit history will change due to analysis of social networks for instance. This can be considered in addition to traditional scoring procedures. Is your credit history/score like a criminal record? Nope. I mean is it always with you? Not really cause a criminal record will be retained on a central storage (to state it abstract) and a credit history can be calculated by private companies. Also, are there other ways to get credit cards besides with a bank? That depends on the country. In Austria, yes. | How can I have credit cards without having a credit history or credit score? |
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No. Like Keshlam said, unless you have a crystal ball there is no sure thing. However based on the things you said in your question, you could be better off doing some back testing. With your findings, you can then set up trades in your favor but again it's not 100%. You may also want to check out quant finance stackexhange. | Is it possible to know the probability that a trade is successful? |
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Every reward program has to have a funding source. If the card gives you x percent back on all purchases. That means that their business is structured to entice you to pump more transactions through the system. Either their other costs are lower, or the increased business allows them to make more money off of late fees, and interest. If the card has you earn extra points for buying a type of item or from a type of store (home stores improvement in the Spring), they are trying to make sure you use their card for what can be a significant amount of business during a small window of time. Sometimes they cap it by saying 5% cash back at home improvement stores during the spring but only on the first $1500 of purchases. That limits it to $75 maximum. Adding more business for them, makes more money for them. Groceries and gas are a good year round purchase categories. Yes there is some variation depending on the season, and the weather, but overall there is not an annual cliff once the season ends. Gas and groceries account for thousands of dollars a year these are not insignificant categories, for many families are recession proof. If they perceive a value from this type of offer they will change their buying behavior. My local grocery store has a deal with a specific gas station. This means that they made a monetary deal. Because you earn points at the grocery store and spend points at the gas station, the grocery store is paying some compensation to the gas station every time you use points. The gas station must be seeing an increase in business so theoretically they don't get 100% compensation from the grocery store. In cases where credit cards give airline miles, the credit card company buys the miles from the airline at a discount because they know that a significant number of miles will never be used. | Why are earning credit card rewards often tied to groceries and gas? |
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If you are still paying off debt, then you should have about $1000 in savings and put all you can towards non-mortgage debt. If you don't have any debt besides your mortgage, then add up all of your monthly expenses including food, gas, utilities and keep 3-6 months in liquid savings. Whether you keep 3 or 6 months depends on how safe your income is. If you have a steady safe job, you might be safe with 3 months. But, if your employer is cutting back or you are in a commission based job or self employed - then lean more towards 6 months expenses. Congrats on your new home! | Is there a good rule of thumb for how much I should have set aside as emergency cash? |
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Vanguard (and probably other mutual fund brokers as well) offers easy-to-read performance charts that show the total change in value of a $10K investment over time. This includes the fair market value of the fund plus any distributions (i.e. dividends) paid out. On Vanguard's site they also make a point to show the impact of fees in the chart, since their low fees are their big selling point. Some reasons why a dividend is preferable to selling shares: no loss of voting power, no transaction costs, dividends may have better tax consequences for you than capital gains. NOTE: If your fund is underperforming the benchmark, it is not due to the payment of dividends. Funds do not pay their own dividends; they only forward to shareholders the dividends paid out by the companies in which they invest. So the fair market value of the fund should always reflect the fair market value of the companies it holds, and those companies' shares are the ones that are fluctuating when they pay dividends. If your fund is underperforming its benchmark, then that is either because it is not tracking the benchmark closely enough or because it is charging high fees. The fact that the underperformance you're seeing appears to be in the amount of dividends paid is a coincidence. Check out this example Vanguard performance chart for an S&P500 index fund. Notice how if you add the S&P500 index benchmark to the plot you can't even see the difference between the two -- the fund is designed to track the benchmark exactly. So when IBM (or whoever) pays out a dividend, the index goes down in value and the fund goes down in value. | How can I compare the performance of a high dividend funds with other funds and or an index |
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If you know what bank your parents used, call them and ask. (Or you might have to go there and show id). Chances are if such an account exists, it would be at the same bank. You can also search for unclaimed property. Here's the information link for Florida. | How to find out if I have a savings account already? |
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Cycle analysis indicates that the current bear market, which began in May/June, should last until late 2016 / early 2017. So if you want to trade the short side, then it's a great time to be short for the next 15-18 months. | Should I continue to invest in an S&P 500 index fund? |
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Facebook the company is probably better understood as a capital good - it is a collection of software and servers and a well-known brand name with a snazzy network effect under reasonably competent corporate governance that can produce final goods and services (mostly services) that actually have value. A share of Facebook stock is a share of ownership in that capital. See also: http://en.wikipedia.org/wiki/Capital_good which makes some concessions for the difference between capital goods and capital services, so it's kind of a fuzzy thing. | Is stock in a company considered a good or a service, or something else? |
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The stupid question nobody asked: how mechanically inclined are you? I buy used cars, but then again I can work on them (I am building a new engine to my specs for one of my cars). Replacing a head gasket in a Subaru would be less than $200 for me, so I would find someone who blew his and offer $1000-1500 for the car if it is one of the models I like. The reality of buying an used car is that you are buying someone's else problems. How much do you know about that specific car model, its quirks, and what usually goes bad on them? For instance, it is a fact most people who buy a BMW 3 series flog them, so expect an used one to have been abused by someone trying to pick up girls by acting like he is a racer. A 5 series, on the other hand, would have a better life. Then some cars tend to rust on certain areas of the body. On the other hand I have seen Hyundai Elantras take a lot of abuse -- no oil change in 3 years -- and keep on ticking. Yes, you need to do some research on new cars, but old ones require even more. If you are going to save money buying used, make sure to spend time and research the options and their hidden costs. And learn how to check a car and have a feel for how much you will spent on repairing/maintaining it. And what you are willing to give up on your first car: is having a working AC that important? How about power windows? If you do buy a used car, try to put $100-200 aside every month, as if you are doing car payments. That will be your emergency and downpayment-for-next-car money. No matter what you buy, remember all you want on a new car is reliability and fuel efficiency. And, how much do you need a car right now? If you have to ride 30minutes to work in pouring rain and then be talking to customers, maybe a car worth having. But, where I live, a lot of people ride bicycles to work and back or use public transportation. I would trust getting into my car right now and drive 5h, and yet I take the bus every day (I like saving money on fuel and parking fees). | Pay for a cheap car or take out a loan? |
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If your counterparty sent money to a correspondent account at another bank, then it is completely up to the other bank what to do with the money. If the wire transfer completed, then the account is not closed. If I were your business partner, I would immediately contact the bank to which the transfer was made and explain the situation and hopefully they will transfer the money back. Whenever a wire transfer is made, the recipients name, address, and account number are included. If that name, address and account do not belong to you, then you have a problem because you have no legal right to the money in a court of law. For this reason, you should be avoid any situation where you are wiring money to anyone except the intended recipient. | What happens if a bank no longer use an intermediary bank? |
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At the area where I live (Finland), banks typically charge a lot more for additional mortgage credit taken after purchasing the house. So, if you are planning to purchase a house, and pay it with a mortgage, you get a very good rate, but if you pay back the mortgage and then realize you need additional credit, you get a much worse rate. So, if this is applicable to your area as well, I would simply buy stocks after you have paid enough of the mortgage that it is only 50% of the house price or so. This is especially good advice if you are young. Also, if your mortgage is a fixed rate and not an adjustable rate mortgage, you probably have a very low permanent interest rate on it as interest rates are low currently (adjustable rate mortgages will also have a low rate but it will surely go up). Some people say there's a bubble currently in the stock market, but actually the bubble is in the bond market. Stocks are expensive because the other alternatives (bonds) are expensive as well. Paying back your mortgage is equivalent to investing money in bonds. I don't invest in bonds at the current ridiculously low interest rates; I merely invest in stocks and have a small cash reserve that will become even smaller as I discover new investment opportunities. I could pay back a significant percentage (about 50%) of the loans I have by selling my stocks and using my cash reserves. I don't do that; I invest in stocks instead, and am planning to increase my exposure to the stock market at a healthy pace. Also, consider the fact that mortgage is cheap credit. If you need additional credit for consumption due to e.g. becoming suddenly unemployed, you will get it only at very expensive rates, if at all. If you're very near the retirement age (I'm not), this advice may not be applicable to you. Edit: and oh, if your mortgage is fixed rate, and interest rates have come down, the bank will require you to pay the opportunity cost of the unpaid interests. So, you may need to pay more than you owe the bank. Edit2: let's assume the bank offered you a 4% fixed rate for a 10-year loan, which you agreed to. Now let's also assume interest rates of new agreements have come down to 2%. It would be a loss to the bank to pay back the amount of the loan (because the bank cannot get 4% by offering somebody else a new loan, only 2%), unless you paid also 10 years * (4% - 2%) * amount = 20% * amount of lost interest income. At least where I live, in fixed rate loans, one needs to pay back the bank this opportunity cost of unpaid interests. | Pay off entire mortgage or put into investments |
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During the hyperinflation of the Wiermer republic, corporate stocks and convertible bonds were thought second only to the species (gold, silver etc) as the only secure currencies. As Milton Friedman proved, inflation is caused solely by the monetary token supply increasing faster than productivity. In the past, days of species of currency, it was caused by governments debasing the currency e.g. streatching the same amount of silver in 50 coins to 100 coins. Sudden increases in the supply of precious metals can also trigger it. The various gold rushes in 19th century and later, improvements in extraction methods caused bouts of inflation. Most famously, the huge amounts of silver the Spanish extracted from the New World mines, devastated the European economy with high inflation. Governments use inflation as a form of stealth flat tax. Money functions as an Abstract Universal Trade Good and it obeys all the rules of supply and demand. If the supply of money goes up suddenly, then its value drops in relation to real goods and service. But that drop in value doesn't occur instantly, the increased quality of tokens has to percolate through the market before the value changes. So, the first institution to spend the infalted/debased currency can get the full current value from trade. The second gets slightly less, the third even less and so on. In 2008, the Federal reserve began printing money and loaning at 0% to insolvent backs who then used that money to buy T-Bill. This had the duel effect of giving the banks an (arbitrary) A1 rated asset for their fractional reserve while the Federal government got full pre-inflation value of the money paid for the T-bills. As the government spent that money, the number of tokens increased fast than the economy. In times of inflation, the value of money per unit drops as its supply increases and increases The best hedges against inflation are real assets e.g. land, equipment, stocks (ownership of real assets) and convertible bonds which are convertible to stock. It's important to remember that money is, of itself, worthless. It's just a technology that abstracts and smilies trading which at the base, is still a barter system. During inflation the barter value of money plunges owing to increased supply. But the direct barter value between any two real assets remain the same because their supplies have not changed. The value of stocks and convertible bonds is maintained by the economic activity of the company whose ownership they represent. Dividends, stock prices and bond equity, as measured in the inflated currency continue to rise in sync with inflation. Thus they preserve the original value of the money paid for them. Not sure why you expect more inflation. The only institution that can create inflation in the US is the Federal Reserve which Trump has no direct control off. Deregulation of banks won't cause inflation in and of itself as the private banks cannot alter the money supply. If banks fail, owing to deregulation, unlikely I think given the dismal nearly century long record of regulation to date, then the Federal Reserve might fix the problem with another inflation tax, but otherwise not. | Are bonds really a recession proof investment? |
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What theyre fishing for is whether the money was earned in the U.S. It's essentially an interest shelter, and/or avoiding double taxation. They're saying if you keep income you make outside the US in a bank inside the US, the US thanks you for storing your foreign money here and doesn't tax the interest (but the nation where you earned that income might). There is no question that the AirBNB income is "connected with a US trade or business". So your next question is whether the fraction of interest earned from that income can be broken out, or whether IRS requires you to declare all the interest from that account. Honestly given the amount of tax at stake, it may not be worth your time researching. Now since you seem to be a resident nonresident alien, it seems apparent that whatever economic value you are creating to earn your salary, is being performed in the United States. If this is for an American company and wages paid in USD, no question, that's a US trade or business. But what if it's for a Swedish company running on Swedish servers, serving Swedes and paid in Kroner to a Swedish bank which you then transfer to your US bank? Does it matter if your boots are on sovereign US soil? This is a complex question, and some countries (UK) say "if your boots are in our nation, it is trade/income in our nation"... Others (CA) do not. This is probably a separate question to search or ask. To be clear, the fact that your days as a teacher or trainee do not count toward residency, is a separate question from whether your salary as same counts as US income. | Does renting a room on AirBnB make all interest taxable? |
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When you want to invest in an asset denominated by a foreign currency, your investment is going to have some currency risk to it. You need to worry not just about what happens to your own currency, but also the foreign currency. Lets say you want to invest $10000 in US Stocks as a Canadian. Today that will cost you $13252, since USDCAD just hit 1.3252. You now have two ways you can make money. One is if USDCAD goes up, two is if the stocks go up. The former may not be obvious, but remember, you are holding US denominated assets currently, with the intention of one day converting those assets back into CAD. Essentially, you are long USDCAD (long USD short CAD). Since you are short CAD, if CAD goes up it hurts you It may seem odd to think about this as a currency trade, but it opens up a possibility. If you want a foreign investment to be currency neutral, you just make the opposite currency trade, in addition to your original investment. So in this case, you would buy $10,000 in US stocks, and then short USDCAD (ie long CAD, short USD $10,000). This is kind of savvy and may not be something you would do. But its worth mentioning. And there are also some currency hedged ETFs out there that do this for you http://www.ishares.com/us/strategies/hedge-currency-impact However most are hedged relative to USD, and are meant to hedge the target countries currency, not your own. | Does the low CAD positively or negatively impact Canadian Investors? |
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There are two sources for shares that employees buy through ESOPs. A company can simply buy the shares on the open market. The company must pay for the stock, but the employee then pays the company for the shares. If employees get a discount on the ESOP shares, the company would pay for that percentage directly. The company can choose to issue new shares. These new shares dilute the ownership of all the other current stockholders. While #2 is common when companies issue stock options, I'd be surprised to see it with an ESOP. In most cases, employees are limited in the amount of their salary they can devote towards the ESOP. If that limit is 10% and the discount that the employees get is 10%, the cost on a per-employee basis would only be 1% of that employees salary, which is a small expense. | How a company can afford to give away so many shares as part of its ESOP |
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@Pete B.'s answer is good, but there's an important note to consider for tax purposes. It's too large for a comment, so I'm adding it as an answer. And that is: you cannot claim the property as a rental property under certain conditions. This affects things like claiming mortgage interest (which you don't have), and depreciation in value (which a rental is allowed). See IRS topic 415 for details, but I've included an important excerpt below with emphasis added: If you rent a dwelling unit to others that you also use as a residence, limitations may apply to the rental expenses you can deduct. You're considered to use a dwelling unit as a residence if you use it for personal purposes during the tax year for more than the greater of: ... A day of personal use of a dwelling unit is any day that it's used by: Talk to a tax accountant to better understand the ramifications of this, but it's worth noting that you can't just rent it to her for a paltry sum and be able to take tax advantages from this arrangement. | Better to rent condo to daughter or put her on title? |
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Forget the math's specifics for a moment: here's some principles. Additional housing for a renter gives you returns in the form of money. Additional housing for yourself pays its returns in the form of "here is a nice house, live in it". Which do you need more of? If you don't need the money, get a nicer house for yourself. If you need (or want) the money, get a modest house for yourself and either use the other house as a rental property, or invest the proceeds of its sale in the stock market. But under normal circumstances (++) don't expect that buying more house for yourself is a good way to increase how much money you have. It's not. (++ the exception being during situations where land/housing value rises quickly, and when that rise is not part of a housing bubble which later collapses. Generally long-term housing values tend to be relatively stable; the real returns are from the rent, or what economists call imputed rent when you're occupying it yourself.) | 2 houses 450k each or one 800k? |
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This is way too long for a comment, so I am posting this as an answer. My bet is that you're buying a new piano. It is the only instrument that makes sense. The rest of this answer are going to assume this, but this should apply well if you're going after a violin or marimba for example. For those readers that do not know, a piano is a very delicate and expensive music instrument. My piano is literally more expensive than my car. There are a lot of similarities in sales negotiation between buying a piano and buying a car. You may be surprised to know that the cost for the dealer to acquire a piano is only around half the listed price. Therefore, the salesperson has a lot of room to negotiate a sale price to you. This explains why he was able to make a good offer for the model you are not intending to buy. You are best by comparing the final sale price with other similar models in your region, or the exact model around your region, which you have already did. Those indicate the standard price in your negotiation. You described the dealer had the exact model you desire, only in different appearance. I assume you want a black color while they have a white or wood-pattern one in their showroom. Note, every piano is different. Even with the exact same model, there will be very slight differences in the tune and touch, since some processes are hand finished. (If you're buying a Steinway, treat each of them as an individual hand crafted art.) Play the exact instrument you will be buying before closing the deal. If they do not have your desired model in the showroom, ask for a visit to their inventory facility. Again, play the exact instrument, not a showroom model. Some dishonest dealers will have their showroom pianos regulated and tuned differently than the "standard" pianos from shipping. If you get an extremely good offer, proceed with caution. There may be defects in that particular instrument. Look for rust or oxidized layers on the strings. Look for groves in the hammers. Listen to clicking noises when playing the keys. These are signs that the instrument has been around for quite a while and they cannot sell it. You can also copy down the serial number and look up the manufacturing date online. Before you close the deal, ask for after-sale services. How many free tunings will they provide? Will they polish your piano after delivery? These are bargain chips you can use for final adjustment of the price. | Buying from an aggressive salesperson |
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If you are using software like QuickBooks (or even just using spreadsheets or tracking this without software) use two Equity accounts, something like "Capital Contributions" and "Capital Distributions" When you write a personal check to the company, the money goes into the company's checking account and also increases the Capital Contribution account in accordance with double-entry accounting practices. When the company has enough retained earnings to pay you back, you use the Capital Distributions equity account and just write yourself a check. You can also make general journal entries every year to zero out or balance your two capital accounts with Retained Earnings, which (I think) is an automatically generated Equity account in QuickBooks. If this sounds too complex, you could also just use a single "Capital Contributions and Distributions" equity account for your contributions and distributions. | How to account for startup costs for an LLC from personal money? |
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If the first one is literally a company name, then 'company name' is fine. However, companies can issue shares more than once, and those shares might be traded separately, so you could have 'Google ordinary', 'Google preference', 'Google ordinary issue B'. Seeing the name spelled out in full like this isn't as common as just the company name, but I'd normally see it referred to as 'display name'. The second one is 'symbol', 'ticker', 'ID', and others. Globally, there are many incompatible ways of referring to a stock, depending on where it's listed (companies can have dual listings, and different exchanges have different conventions), and who's referring to it (Bloomberg and Reuters have different sets of IDs, with no predictable mapping between them). So there's no one shorthand name, and the word you use depends on the context. However, 'symbol' or 'ticker' is normally fine. | Terminology: What are the labels associated with a share called? |
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There is no such thing as a correct value. There are different ways to calculate (read: guess) an anticipated value, but neither of them is the "correct" one. Last not least this depends on your interpretation of the term "correct" in that context. Why do you think paid Facebook such a huge amount for WhatsApp? Surely not, because it was the "correct" value. | What is the valuation of a company based on? |
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Our mortgage provider actually took the initiative to send us a refinance package with no closing costs to us and nothing added to the note; took us from a 30-year-fixed ~6.5% note to a 15-year-fixed ~5% note, and dropped the monthly payment in the process. You might talk to your existing lender to see if they would do something like that for you; it gives them a chance to keep your business, and it cuts your costs. | What is the best way to determine if you should refinance a mortgage? |