Tag Archives: jacob gold associates

economy

Politics or Economics?

Within the last few years we’ve experience a major cross over between politics and economics. Is this a good or a bad thing? Many economists believe that more political intervention can negatively affect the natural growth of the economy. While others believe that the U.S. could not have survived the 2008 “great recession” without the government’s assistance. Nor, would we be able to sustain future growth unless we continue to have the governments support.

It’s obvious that our global economy is more involved politically but how much do we rely on our government relationships and policy to control our economic growth. I believe our society understands that we need government support in many aspects of our economy but when control becomes a liability, it certainly poses the question of when should the government pull back? As much as we rely on monetary policy to tighten or loosen our money supple, hence, increase or decrease growth in our economy, the political party battles is becoming more of a distraction. Hopefully, decisions that need to be made will be address in a responsible manor and actions will be taken in affect.

Recently, the United States government shutdown for the 18th time, this is primarily due to political party differences. Yet, another political battle between the Democrats and Republicans spark uncertainty in the markets. Although, government issues don’t seem to be directly affecting the markets at this time, it can influence institutional and individual investors to re-direct strategies short-term. Events such as this have become an ongoing concern and come October 17th we may have another issue regarding the debt ceiling. These political disagreements hopefully will begin to focus on what is needed to improve our society and economic environment. Rather than continuing to use situations such as these for political gain and finger pointing.

As a financial advisor, I meet with my clients on a consistent basis to review their accounts and investment strategies. During the last few years, I’ve noticed an emphasis on our changing government environment of the U.S. and less on saving properly for the future.  There has been so much noise about political and economic issues that we’ve missed some of the fundamental ideas of saving for retirement. Changes such as healthcare, entitlement benefits, inflation, and life expectancy are a major aspect of planning, but without having a responsible strategy of saving many investors limit their success for retirement.

Hopefully, as we move forward, the media, investors, and educators will focus on the importance of actions and responsible saving strategies. Working with clients, I find that having a well diversified portfolio that fits ones investment risk and time horizon is critical. However, continuing to stay focused on investor’s objectives through political and economic uncertainty has been more challenging within the last few years.

 

Michael Cochell  is associate vice president at Jacob Gold & Associates Inc.  This information was prepared by Michael Cochell of Jacob Gold & Associates Inc. and is for educational information only. The opinions/views expressed within are that of Michael Cochell of Jacob Gold & Associates Inc. and do not necessarily reflect those of ING Financial Partners or its representatives. In addition, they are not intended to provide specific advice or recommendations for any individual. Neither ING Financial Partners nor its representatives provide tax or legal advice. You should consult with your financial professional, attorney, accountant or tax advisor regarding your individual situation prior to making any investment decision

 

 

 

 

 

Investment Style

Do You Have An Investment Style?

Many investors rely on their expertise, or their advisors’ expertise, to develop and follow an investment style. These styles are important and can help provide direction and assist in making investment decisions. Investment styles are developed based on many factors, including age, gender, income, family, wealth, tax situation and previous investment experience. These factors play important roles when developing an investment style and should be considered thoroughly.

One of the most important factors to consider when determining an investment style is the investor’s objective. For example, the portfolio of an investor whose main objective is growth (accumulation phase) may differ significantly from the portfolio of any investor whose main objective is capital preservation (income phase).

The majority of investment choices available, be they equities, bonds, or financial derivatives, follow their own particular investment style. It is important for investors to understand each to ensure they fit into their style. A financial professional can help with research and help determine the appropriate style for an investor and his or her needs.

Most money managers typically focus on a few dominant styles, including active vs. passive investing, growth vs. value, bottom-up vs. top-down, and technical vs. fundamental analysis.

An active investor’s primary focus is to outperform the market by picking various individual stocks. On the other hand, passive investors may consider investing in an index fund designed for long-term results. An active strategy consists of timing the buying and selling of different stocks in hopes of beating the ups and downs of the market. The passive approach is very hands-off and relies on market performance alone.

One can also qualify an investor as having a growth or value approach to investing. Typically, growth styles seek investment in companies expected to have a 15 percent to 25 percent increase in earnings. Value investors, on the other hand, tend to lean more toward companies offering bargains or “cheap” shares compared to current earnings.  Growth style investments tend to be more volatile than value investments. Many money managers may combine both styles for diversification.

Bottom-up or top-down approaches are also important to understand and consider in one’s investment style. A bottom-up approach focuses on a particular company’s fundamentals. One example may be the performance of a company’s earnings (price/earnings ratio). A top-down approach will look at the macroeconomic picture, considering inflation and consumer spending, then choosing to invest in a particular industry.

Investors may also decide whether their investment style fits a technical or a fundamental approach. When applying a technical style, money managers will use charts, price and specific economic data to identify patterns related to a particular stock investment. An investor who uses a fundamental approach will analyze actual financial accounting data as well as the profitability of a company to determine what stocks to have in his or her portfolio.

These are important factors to understand and can help investors identify which investment style best suits them. Keep in mind that an investor’s style will most likely change as his or her objectives change. Constant monitoring of investments is critical to success and helps to avoid style drift.

For more information about investing and investment style, visit jacobgold.com.

Securities and investment advisory services offered through ING Financial Partners, Inc. Member SIPC. Jacob Gold & Associates, Inc. is not a subsidiary of nor controlled by ING Financial Partners, Inc. This information was prepared by Michael Cochell of Jacob Gold & Associates, Inc. and is for educational information only. The opinions/views expressed within are that of Michael Cochell of Jacob Gold & Associates Inc. and do not necessarily reflect those of ING Financial Partners or its representatives. In addition, they are not intended to provide specific advice or recommendations for any individual. Neither ING Financial Partners nor its representatives provide tax or legal advice. You should consult with your financial professional, attorney, accountant or tax advisor regarding your individual situation prior to making any investment decisions.
value of money

Time Value Of Money And Planning

Understanding the general concept of the time value of money can help consumers plan appropriately for future needs and today’s wants. This concept applies to how a consumer may save, invest and make decisions on lending needs.

Many of us are familiar with the idea that the earlier one starts saving the more he or she will have in the future. This may be the case, but it’s also important to be familiar with present value of money and debt, future value of money and debt, and the beginning period and ending period of saving.

When a consumer considers how these concepts work together, it can provide the consumer with the valuable information needed to effectively plan for the future. A good example is credit card debt. If one were to calculate the length of time and amount of finance interest paid to credit card companies by only paying the minimum payment, it would shock most of us.

Saving for future needs is important. We must understand that the dollars we save today (present value of money) will most likely be worth less in the future. So how can we make decisions to save and take advantage of time value? Let’s consider a scenario of saving for retirement in an IRA (Individual Retirement Account) annually. Investors have a choice to save at the beginning (beginning period) of each year rather than saving at the end of the year (ending period of investing). Using this strategy, an investor can earn more on his or her money by contributing the same dollar amount annually at the beginning of the year rather than at the end of the year.

Investing consistently and taking advantage of different types of accounts sponsored by employers, deferred-tax saving retirement accounts and after-tax saving accounts can help consumers plan for retirement. Many employers offer match savings, as well as company contribution, just for signing up for the employer retirement plan. It’s important to take full advantage of the match. Also, some plans offer both a Traditional (pre-tax) deferred saving as well as (after-tax) Roth saving plan. Each of them has specific benefits, and if used properly, they can be a valuable piece of a consumer’s planning strategy. Keep in mind that withdraws prior to age 59-1/2 may result in a 10 percent IRS tax penalty, in addition to any ordinary income tax. IRA and Roth IRA accounts can also be used in addition to employer sponsored plans.

The traditional employer plan and individual retirement plans allows consumers to save on a tax deferred basis; however, he or she will need to account for ordinary income taxes during distributions. Where as, Roth contributions allow for after-tax contributions and tax-free growth and withdraws. By combining these options, and starting sooner rather than later, consumers can take advantage of the time value of money as well as using all options available.

As consumers, it’s not only important to take advantage of the time value of money by investing early, but it’s also important to manage debt in a similar way. Present debt and future debt are key ingredients to manage and can make or break consumer’s future plans. By applying the same concepts to debt management, one can see the value of using time as a way to structure debt for the consumer rather than the financing institution. For example, be wary of committing to long-term debt. When committing to long-term debt, consider a plan to payoff the debt early by making additional payments. Applying the time value of money in this case will save consumers a lot of money in the long run and reduce debt sooner. Also, keep in mind that lower interest rates will help save consumers finance cost. A little extra planning can greatly benefit consumers.

These concepts can be very valuable with practice, practice and more practice. Consumers can become experts in controlling their way of using time value of money and planning for future needs. For more information, visit jacobgold.com.

Securities and investment advisory services offered through ING Financial Partners, Inc. Member SIPC. Jacob Gold & Associates, Inc. is not a subsidiary of nor controlled by ING Financial Partners, Inc. This information was prepared by Michael Cochell of Jacob Gold & Associates, Inc. and is for educational information only. The opinions/views expressed within are that of Michael Cochell of Jacob Gold & Associates Inc. and do not necessarily reflect those of ING Financial Partners or its representatives. In addition, they are not intended to provide specific advice or recommendations for any individual. Neither ING Financial Partners nor its representatives provide tax or legal advice. You should consult with your financial professional, attorney, accountant or tax advisor regarding your individual situation prior to making any investment decisions.
Create a Budget

Cash Flow Management: Creating A Budget To Reach Financial Success

Tracking of cash flow dates back more than 3,000 years. Before currency existed, people would use cattle, grains, silver or other items of value as trade. These transactions, tracked on tablets or sometimes counting tokens, were used as a tool to track financial dealings. This tells us that managing trade or cash flow has been around for decades and is a critical factor when it comes to managing finances. Some important elements are creating a budget, emergency fund planning, debt management and savings strategies.

When it comes to planning for future goals, a budget can be a very useful guide to help reach financial success. A budget helps project future cash flow needs and can be a great tool to assist with preventing financial problems and increasing net worth.

Before putting a budget together, one will need to gather data on past spending and income. The budgeting process should include: estimating income, estimate of spending, and planning for savings. Begin by putting a preliminary budget in place which will include goals and priorities for each goal. Track these goals on a regular basis and make necessary changes when needed.

One of the top priorities of a budget is having an emergency fund. This is critical and is often overlooked. Many planners recommend having at least three to six months of expenses, but with the increased cost of goods and services today, many feel that six to nine months is best. Expenses should include fixed cost and variable cost. Emergency funds should be in a high liquid type of account, such as a savings or money market account.

Debt management has become a very challenging issue today. Hopefully, with the degree of issues we’ve seen in the last few years, people will see the importance of managing their debt closely.

Three common rules of debt management are: total monthly debt should not exceed 36 percent of gross income, mortgage payments should not exceed 28 percent of gross income, and consumer debt should not exceed 20 percent of gross income.

In our fast-paced society and with the current availability of credit, it can be difficult to stay within these parameters. However, using these rules as a guide and implementing them can help us get back to managing our debt within a reasonable level. Financial debt will eventually catch up to us, but before it does, we can take responsibility now to control it before it controls us.

Many people who begin to think about saving usually consider it only when they have excess or residual income. Saving should be planned as part of a budget sooner than later, not just when it’s convenient. Delaying saving usually ends up never happening or may be too late to be beneficial. At a minimum, it is recommended to save five to 10 percent of income annually. I also suggest to increasing the saving percentage every year; this will help keep up with inflation and allow investors to get a head of the saving game.

These are important factors and planning tools that can help with implementing or adjusting a financial plan and managing cash flow. The earlier an individual, household or business can start, the more likely for success.

 

Securities and investment advisory services offered through ING Financial Partners, Inc. Member SIPC. Jacob Gold & Associates, Inc. is not a subsidiary of nor controlled by ING Financial Partners, Inc.

This information was prepared by Michael Cochell of Jacob Gold & Associates, Inc. and is for educational information only. The opinions/views expressed within are that of Michael Cochell of Jacob Gold & Associates Inc. and do not necessarily reflect those of ING Financial Partners or its representatives. In addition, they are not intended to provide specific advice or recommendations for any individual. Neither ING Financial Partners nor its representatives provide tax or legal advice. You should consult with your financial professional, attorney, accountant or tax advisor regarding your individual situation prior to making any investment decisions.

Investment Products

Investment Products: Which Is Best For Me?

Investment Products: Which Is Best For Me?

The financial industry continues to develop innovative products and improve services. As consumers we can feel overwhelmed when faced with choosing a product for our needs.

There are many products for different needs, and when faced with choosing one, it can be difficult. Investors have many choices and can use different avenues to invest their money. These options include stocks, bonds, mutual funds, annuities, and real estate.

Types of Investment Products

Stocks: Stocks are an equity position in a corporation that can provide the possibility of investment growth.

Bonds: Bonds, on the other hand, are a debt instrument that is issued by the state, government, city, municipality or corporation, and can repay the original investment along with interest.

Mutual fund: An investment company that pools money from many investors and invests it based on specific investment goals.

Annuities: Annuities are financial products sold by an insurance company that is designed to help reach financial goals and can provide income.

Real estate: Lastly, real estate is another option that can be used by owning property or investing in real estate investment trust.

These are only some products that can help investors fulfill their investment needs.

(You should consider the investment objectives, risks and charges and expenses of mutual funds carefully before investing. The prospectuses contain this and other information, which can be obtained by contacting your representative. Please read the information carefully before investing. Add a standard risk disclosure due to the discussion of specific investments: Investments are not guaranteed and are subject to investment risk including the possible loss of principal. The investment return and principal value of the security will fluctuate and when redeemed may be worth more or less than the original investment.)

Which investment product is right for me?

It depends on an investor’s goals, risk tolerance and time horizon. An investor should consider these factors and work with a financial professional to help decide the best product for him or her.

Each of these investment products has strengths and weaknesses depending on how they are used. It is also important to apply your personal situation and consider your objectives when deciding on an investment product.

Investors should be cautious when taking advice from marketing ads or television because these sources typically only present the product and its features. How they can apply to your specific situation is important to understand before investing. It is also critical to take the time to thoroughly analyze how each product can be beneficial and consider not only the benefits but also the potential downside risk.

For more information about investment products, visit jacobgold.com.

 

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Securities and investment advisory services offered through ING Financial Partners, Inc. Member SIPC. Jacob Gold & Associates, Inc. is not a subsidiary of nor controlled by ING Financial Partners, Inc.

This information was prepared by Michael Cochell of Jacob Gold & Associates Inc. and is for educational information only. The opinions/views expressed within are that of Michael Cochell of Jacob Gold & Associates Inc. and do not necessarily reflect those of ING Financial Partners or its representatives. In addition, they are not intended to provide specific advice or recommendations for any individual. Neither ING Financial Partners nor its representatives provide tax or legal advice. You should consult with your financial professional, attorney, accountant or tax advisor regarding your individual situation prior to making any investment decisions.

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Estate Planning: Planning Your Future

Estate Planning: Planning For The Future

Estate Planning: Planning for the Future

When planning your financial future, it is important to consider an investment strategy, risk tolerance and time horizon. These are critical aspects of building wealth.

Although many of us focus on the now, we forget about organizing our finances and personal interests upon our passing. This aspect of planning is neglected many times and can put everything at risk. As investors, we will spend many years saving and planning; we should take the steps to protect all that we have built. This can be done by arranging an estate plan that will allow you to pass on your assets to who you want, how you want, and when you want.

This type of planning may seem overwhelming, but an effective estate plan doesn’t need to be complicated. It can be broken down in two key elements. The first is having a durable power of attorney and the second is a will.

Having a durable power of attorney will allow you to manage your assets while you are still living by appointing someone to act in the event you are unable to do so. A will focuses on managing and distributing your assets after death.

In addition to these key elements, an estate plan can help avoid the problems and expenses of probate, avoid family conflicts, provide flexibility in estate management, and minimize taxes at the time of death. These are some of the benefits and why estate planning is so important. However, how does one get started on setting up an estate plan?

Most estate planning objectives can be accomplished by hiring an attorney or by using an online “do-it-yourself” approach. The cost of hiring an estate planning attorney to assist with the development and implementation of an estate plan is typically far outweighed by the benefits of recruiting experienced council. The person who decides to save money by using an online service is likely to make costly mistakes, says estate attorney Kari Meyrose of Gorman and Jones Law Firm.

“Estate planning attorneys spend many years learning the contours of estate planning rules and methodologies, and they have the ability to forecast the potential outcomes that may result from an individual estate plan,” Meyrose says.

Estate plans range from simple to very complicated, and in some cases the cost of not using an attorney may actually end up being a very costly lesson for loved ones. Either way you decide— do it yourself or use an attorney — don’t procrastinate in making a choice and take action in planning your future.

For more information about estate planning or Jacob Gold & Associates Inc., visit www.jacobgold.com.

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This information was prepared by Michael Cochell of Jacob Gold & Associates Inc. and is for educational information only. The opinions/views expressed within are that of Michael Cochell of Jacob Gold & Associates Inc. and do not necessarily reflect those of ING Financial Partners or its representatives. In addition, they are not intended to provide specific advice or recommendations for any individual. Neither ING Financial Partners nor its representatives provide tax or legal advice. You should consult with your financial professional, attorney, accountant or tax advisor regarding your individual situation prior to making any investment decisions.[/stextbox]

Key Elements to Retirement Planning

Key Elements To Retirement Planning

There are countless books, articles, and videos that discuss how to plan for your retirement — many of which can be found at universities, books written by financial gurus, business owners, institutions and professionals in the industry. If one were to Google retirement planning, there would be tons of information, multiple websites, retirement calculators and sources to learn about what to do and how to do it.

There is no one right way to plan or a single investment strategy that works for everyone. But there are some important elements to follow that can help improve the odds of retiring successfully. Some of them include investment strategies, retirement timeline, risk management and asset protection, and estate planning.

Investing has many levels that range from very risky to very conservative. An investor can choose to invest in stocks, bonds, annuities, insurance and real estate. All of these can be valuable if used the proper way and for the right purpose.

But before choosing an investment, I would recommend to complete a series of questionnaires to learn more about what may be suited for that investor. Also, having a good mix of different risk levels and different products can help provide opportunity and protection.

Another important element that should be at the top of the retirement planning list is the value of time. The earlier we start the better the odds to navigate through difficult markets and the better we can plan for life changing events. Navigating through difficult markets is very challenging and staying the course usually works to the investors favor. Having the courage to stay invested and setting aside emotional decisions is critical. Also, by starting sooner it will allow investors to take advantage of compound interest.

Risk management and asset protection can be looked at in many different ways. The most common, is protecting our loved ones by insuring them and the assets we have accumulated. Unknown events will occur from time to time and preparing for these events before they happen can make or break our retirement success. Balancing for the now as well as the future is essential.

Once we have reached our goals, investors should plan to protect their estate with the hope to pass it to their heirs. This task first begins by organizing financials and personal interest to meet one’s wishes upon their passing. The best and most appropriate way to accomplish this is to seek the services of an attorney. It is important to provide the attorney all of the necessary information and have thorough discussions of your wishes so they can be carried out accordingly.

These are important elements of retirement planning and vary per person or household. It is important to take the time to research and learn about what steps to take in starting your plan, managing your plan, and having a resolution to your estate. I recommend working with a financial professional and reviewing your plan annually.

For more information about retirement planning and investing, visit Jacob Gold & Associates’ website.

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This information was prepared by Michael Cochell of Jacob Gold & Associates Inc. and is for educational information only. The opinions/views expressed within are that of Michael Cochell of Jacob Gold & Associates Inc. and do not necessarily reflect those of ING Financial Partners or its representatives. In addition, they are not intended to provide specific advice or recommendations for any individual. Neither ING Financial Partners nor its representatives provide tax or legal advice. You should consult with your financial professional, attorney, accountant or tax advisor regarding your individual situation prior to making any investment decisions.

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choosing retirement plans, arizona business owners

Choosing Retirement Plans for Business

Choosing retirement plans for business owners: Today, business owners are a critical piece for the growth of our economy. They will continue to provide new innovations and venture out to other countries improving competitiveness in our global markets.

New businesses have become the backbone of our U.S growth. For this reason it is important to have support from our government, consumers and the business owners themselves.

One of the ways our business owners help support our economy is by providing jobs and retirement plans to help us plan for our future. However, choosing retirement plans, and the right one at that, for a business owner can be overwhelming and confusing. It takes hours of research and a check list of highly relevant questions to figure out the best plan for the type of business. Most of the facts include demographics of the employees such as their ages and income, along with the overall financial objective for the plan.

There are numerous plans to choose from such as: SEP’s, SIMPLEs, 401(k)’s, 403(b)’s, Solo 401(k)’s, Safe Harbor 401(k), Profit Sharing, Defined Benefit Plans, Money Purchase, and so on. In addition, add an array of non-qualified plans, and it becomes even more daunting.

For example, the SEP-IRA allows a contribution of up to 25% compensation with a limit of $49,000. It also is very easy to set up and has low administration cost. Whereas a traditional 401(k) is appropriate when a business seeks to make large contributions for the owner(s) and other partners, as well as provide an employer contribution for employees as a benefit.

The traditional 401(k) options have many benefits and allow the employer to control eligibility, match options and vest schedule. It also provides asset protection under ERISA and allows plan participants to contribute $16,500 for 2011 — plus an additional $5,500 if the participant is age 50 or older.

On the other hand, 401(k) plans may create high fiduciary responsibility for the business owner and have higher administration cost due to complex discrimination testing.

Choosing retirement plans for business is challenging, and I found that the process of elimination helps sift through the many choices; and clearly identifying what you want to achieve for you and your employee’s financial goals will narrow the choices.

As our economy continues to work though the recent recession, business owners will still provide new innovations in servicing and production of goods. We hope that as our economy stabilizes, we will see more opportunities for businesses to choose retirement plans and offer the right one to employees to help our future retirees.

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For more information about choosing retirement plans, visit www.jacobgold.com.

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Securities and investment advisory services offered through ING Financial Partners, Inc. Member SIPC. Jacob Gold & Associates, Inc. is not a subsidiary of nor controlled by ING Financial Partners, Inc.

This information was prepared by Michael Cochell of Jacob Gold & Associates Inc. and is for educational information only. The opinions/views expressed within are that of Michael Cochell of Jacob Gold & Associates Inc. and do not necessarily reflect those of ING Financial Partners or its representatives. In addition, they are not intended to provide specific advice or recommendations for any individual. Neither ING Financial Partners nor its representatives provide tax or legal advice. You should consult with your financial professional, attorney, accountant or tax advisor regarding your individual situation prior to making any investment decisions.

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