Author: Wall Street Vibes

Your Social Security Mulligan

This post was originally published on this siteNo one is perfect. All of us screw up from time to time. On the golf course, some scratch golfers will bend the rules. If they make a bad shot, they’ll take a second one and continue as if the mistake never happened. Golfers call that a mulligan. Mistakes are a part of life – “stuff” happens. Unfortunately, some mistakes, such as collecting Social Security too early, can cost you a lot of money. But I have good news for those of you who’ve tapped your Social Security benefits prematurely: You can fix it. Here’s how to get a second chance at maximizing your payout. Americans Are Handicapping Their Retirements For many Americans, Social Security benefits are their biggest asset. In fact, for 20% of married couples and 40% of single beneficiaries over the age of 65, Social Security makes up 90% of their income. But here’s an even scarier statistic. Nearly half of Americans begin collecting Social Security retirement benefits at the earliest age possible – 62. That’s a full four to five years before they reach full retirement age (FRA). Remember, FRA is not to be confused with your “ideal” retirement age. FRA is the age at which you can begin receiving your full, unreduced Social Security benefits. Your FRA is based on the year you were born, so it...

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Live Free and Prosper With ETF Investing

This post was originally published on this siteAt this year’s 20th Annual Investment U Conference, I posed the following question to my audience… “What’s the most successful financial product of the last decade?” The No. 1 answer? “Index funds.” John Bogle, the founder of index fund giant Vanguard, has been remarkably successful in getting his message out to investors. Yes, index funds are a terrific innovation that have changed the investment landscape for the better. But I believe there’s been an even more important innovation in the markets. And that innovation is exchange-traded funds (ETFs). Let’s quickly review just...

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What’s So Great About the Super-Rich?

This post was originally published on this siteThis week I am speaking on several investment panels at FreedomFest at the Paris Hotel in Las Vegas. (For more information, click here.) But I’m particularly looking forward to my debate with Lanny Ebenstein, a highly regarded political scientist, educator and author of several books, including biographies of libertarian economists Milton Friedman and Friedrich Hayek. Our debate topic? “Can Anything Good Come From Being Super Rich?” No doubt most readers would like to find out from personal experience. Pollsters regularly find that Americans list “getting rich” as one of their primary goals in life. Let me confess upfront that I’m one of the detestable 1% that some folks are always banging on about. Though I’m not sure why, really. Speaking from personal experience, I’ve never inherited a dime from anyone. I’ve never had any special connections. I didn’t get a “legacy admission” into an Ivy League university. I’ve never founded, run or owned my own company. All I’ve done is work, save, invest and reinvest over a period of decades, just like most of the folks featured in Dr. Thomas Stanley’s classic work, The Millionaire Next Door. And there are quite a few of us, actually. As I’ve mentioned in earlier columns, the number of American millionaires is at an all-time high. In May, Spectrem Group, a market research firm, reported that...

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1 in 4 People Don’t Have a Retirement Plan

This post was originally published on this site There are a lot of things in life we plan for: college, weddings, careers, kids and even what we’re having for breakfast tomorrow (an everything bagel with cream cheese for me). Yet there’s one major life event that a large number of us fail to prepare for: retirement. According to our recent survey, 25% of Wealthy Retirement readers don’t have a retirement saving strategy… and that’s scary. But before we delve into the “how” (aka how to create a positive path to post-work life), let’s look at the “why.” Why are...

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The Danger of Using Leverage in Your Retirement Portfolio

This post was originally published on this siteI was always taught that the most important words in the English language were “please,” “thank you” and “I love you.” But those words don’t really apply when it comes to investing. That said, there’s another word that does… You see, it’s a dangerous world out there, and your hard-earned money is almost always at risk. Stocks can move higher or lower, as can bonds and mutual funds. But those moves are normal and expected. If you sell during a panic, shame on you. However, my concern is not what happens normally but what happens when you ignore the most important word in investing: leverage. It can make or break your portfolio depending on which way interest rates are headed. Yet leverage is often ignored because it’s buried deep inside the prospectus of the investment fund you’re holding. Leverage is associated with debt or buying stock on margin. While those are both important, I am referring to the leverage in funds that pay monthly or quarterly dividends. It’s critical that you examine your investments right now, especially the funds that pay you interest. Look at the funds’ holdings and then look for the word “leverage.” If you see it, you need to rethink holding that fund during this period of rising interest rates. When a fund uses leverage, it is borrowing money...

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