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Financial Planning Articles

  • Long-Term Newsletter Performance: It's Not Easy to Beat the Market

    How have investment newsletters performed over the very long term? Overall, beating the market is a relatively rare phenomenon.

  • Clueless: What Graduates Need to Know About Making Financial Decisions

    Bad decision-making in an individual's early years can have a detrimental effect on their well-being throughout their working lives. A primer aimed at the younger generation on how to avoid early-year financial mistakes.

  • Does Social Investing Generate Higher Returns?

    Companies with high social responsibility ratings outperformed companies with low ratings, but to get the highest returns, you should not shun shares of any company.

  • Optimizing Your Retirement Income: What Works Best and Why

    Only a small minority of Baby Boomers are accumulating enough savings to provide for their income needs. But those approaching retirement can improve their financial security in retirement, depending on their flexibility and their approach to four big decisions that are under their control.

  • Due Diligence: 10 Steps to Avoiding Ponzi Schemes and Financial Fraud

    The uncovering of Bernie Madoff's Ponzi scheme, and the fraud committed by several other financial hucksters, highlights the importance of asking the right questions before selecting an advisor or participating in an investment. Ten questions to ask, and red flag warning signs of the potential for trouble.

  • Financial Professional Terms: What They Mean and Why You Should Care

    Broker, financial planner, investment advisor and wealth manager are just a few of the common terms used to describe various financial professionals. Many individuals do not have a clear understanding of what distinguishes one from another. A look at the terms and differences in duties owed to clients.

  • The Role of Diversification in an Individual Stock Portfolio

    A large number of holdings makes it impossible for investors to know their companies well. At the other extreme, holding just a handful of stocks can subject you to unnecessary risk and also impairs your ability to make rational decisions under pressure. Managing these emotional realities is one of the more subjective aspects of risk management through diversification.

  • Stocks for the Long Term: Why Prospects Are Rosy

    You already know the bad news concerning stocks. The good news is that based on today's depressed prices, long-term stock prospects appear above average. A look at some of the evidence that supports a rosy multi-year stock outlook, and a framework for applying these forecasts.

  • The Portfolio Review: Why It Is Important and How to Do It

    Since regular reviews are the foundation of successful investing, resolve to evaluate your portfolio. Julie Jason explains how.

  • New Rules for Converting to a Roth IRA

    The income restrictions have been lifted, but does converting to a Roth IRA make sense for you? Plus, find out why a recharacterization can give you even more flexibility for managing your tax exposure.

  • Health Care Reform's Tax Implications

    New taxes will be levied by the new law starting in 2013. Read about what those taxes are and what can cause someone to be exposed to them.

  • The Pitfalls of Life Settlements

    Life settlements are often unfavorable due to high commissions and a lack of transparency.

  • Investing in Health Care Reform

    Health care mutual fund managers reveal which industries could benefit and which could suffer from the new law.

  • Insurance Products and Taxes: Keeping Uncle Sam at Bay

    Taxes are a fact of American life that impact many areas, including life and disability income insurance. Understanding the relationship between insurance and taxes is important. A look at several tax issues.

  • Immediate or Income Annuities

    Annuities are primarily used as a means of securing a steady cash flow during retirement. Unlike a deferred annuity, an immediate annuity has no accumulation period--an investor simply pays the insurance company a lump sum, and then receives the stream of payments for the set time period.

  • Do's and Don'ts of IRA Investing

    Complicated and restrictive rules can lead to unintended problems. Learn which assets and transactions are allowed and which are not in an IRA.

  • Diversification: A Failure of Fact or Expectation?

    Did diversification fail investors during the most recent bear market or did investors simply take on too much risk? Sam Stovall looks at the historical trends to find answers.

  • Human Capital and the Theory of Life-Cycle Investing

    Life-cycle theory, first developed in the 1970s, points out that each person has both human and financial capital, with the former being most important. While it seems like a small change to focus more on human capital, it has major planning implications.

  • How to Create Your Own Pension: A Closer Look at Immediate Annuities

    How would you like to have lifelong income even after you retire? That's what it's like to receive a pension. What if you don't have one? One option is to buy a product that will create one for you--an "immediate annuity," which is the oldest product of its kind in the marketplace.

  • Medicare Health Insurance Coverage

    Do you need help understanding Medicare benefits? These Web sites offer the best information relating to basic coverage issues, benefits offered, how to enroll, how to choose your options and how to compare plans.

  • 529 College Savings Plan

    An investor reference for products that are not your typical offering. This issue's focus is on 529 plans for college savings.

  • Checking Insurance Company Safety

    How can you evaluate the financial health of an insurance company? One approach is to check the financial safety ratings that have been assigned to the company by one of the ratings agencies.

  • Monitoring Bank Safety On-Line

    Bank failures and the ongoing turmoil in the financial markets have many individuals concerned about the stability of their own banks. Of course, even in the face of a bank failure, investors have some protections.

  • Retirement Plans: Evaluating the New Roth IRA Conversion Opportunity

    Starting in 2010, investors have the option of converting all or part of their traditional IRA into a Roth IRA regardless of how much they earn. Whether you are years away or approaching retirement, you may find it worthwhile to consider a conversion--either for yourself or to potentially leave tax-free assets to heirs.

  • Surviving a Loss: Smart Steps for Coping With Widowhood

    If you have recently lost your spouse, you are confronting many changes. Because financial planning at this stage involves both a person's emotional state and financial state, many widows are pushed to make unwise decisions, or to make changes before they are ready. Smart steps for widows to take when the time is right.

  • Reverse Mortgages

    Older homeowners looking for ways to raise current income may consider tapping into their home equity by using a reverse mortgage.

  • Your Portfolio: Maintaining Perspective

    Financial turmoil can prompt an emotional response that causes investors to flee stock holdings. But this can cause long-term harm to your portfolio. Instead, you need to put things in perspective and stick to the fundamental rules of investing.

  • Prior Bear Markets: A Poor Guide to Future Newsletter Performance

    The current stock bear market has been so traumatic, it is likely to dominate investment decision-making for years. But that may not be such a good thing, because performance in bear markets is a poor guide as to how an adviser or strategy will perform over the long term. A look at the numbers.

  • Faith-Based Investing

    An increasing number of mutual funds and ETFs incorporate religious principles.

  • Retirement Income: Repairing the Damage to Assure the Flow

    If you are living off your retirement savings and have suffered a severe portfolio loss, what is your best course of action to ensure your savings can be sustained? A new T. Rowe Price retirement income study compared various withdrawal strategies.

  • The Role of Risk-Free Assets in Your Long-Term Portfolio

    In today's market environment, the exclusive focus is on risk-free assets for the short term. Two years ago, the same assets were considered "too boring" over the long term. What role should they play in your portfolio? The answer requires both a short-term and a long-term perspective.