Well, it’s been a month since my “Suze on Variable Annuities” post which sparked some heated debate. So much so, that I decided to take a look at a newer product, the Fidelity Growth & Guaranteed Income Annuity and analyze it in a feature article titled “Another Look at Variable Annuities” on my main web page.
I must say, I find the process interesting. I’ve been a ‘spreadsheet guy’ for some time and enjoy playing with the numbers. Please read the article and comment here, if you wish. The Fidelity link above should download a PDF of a brochure for the product I analyzed. If it doesn’t, please advise of the broken link.
Joe
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I’ve seen remarks across the blogosphere that the recent FDIC advertisements are a bad sign. I’m not convinced. I think there are many who have no idea how the FDIC protection works, what its limits are, and how to get more coverage. First, here is one of the ads they are running:
The important thing to understand is that non-retirement accounts are insured up to $100K. If you have more cash than this, you should consider splitting it up among more than one bank. In the case of a failure, you may have to wait some time to access your money, so even if you are below the limit, using 2 or 3 banks is a good idea. See the FDIC Website for more details.
Joe
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They say that when the shoeshine boy starts talking about stocks it’s a time to get out of the market. Last week, David Letterman offered his Top Ten List,
Top Ten Signs You Have a Bad Bank
- Manager giggles whenever he says, “early withdrawal”
- They made $2 million loan to the Hillary Clinton campaign
- Most banks are backed by the FDIC; your bank is backed by KFC
- Bank robbers leave with a sack of IOUs — that’s how bad things are, ladies and gentlemen
- Loan officer will approve your mortgage only if you let him rub you
- ATM looks suspiciously like a Ms. Pac-Man machine
- Interest paid not in money, but in Saltines
- They promise they’ll have your money if you come back after tonight’s Keno drawing
- Instead of Andrew Jackson, their $20 bills have a picture of Tito Jackson
- Teller asks, “How may I swindle you?”
Maybe this is the sign that we’ve reached the bottom in this crisis, I hope so.
Joe
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I first wrote of this phenomenon last September in a post titled “Disappointing Returns“. In that post I cited data that reported that for the 20 years ended Dec. 31, 2006, the average stock fund investor earned a paltry 4.3 average annual compounded return compared to 11.8 percent for the Standard & Poor’s 500 index. Wow, that’s abysmal. These investors would have fared better by staying in CDs during that time. Last month (the June issue) in Smart Money magazine, I found this telling graph;
What we find is that investors don’t buy and hold. Not by a long shot. They pour money in just at the market is reaching a top, and then, just as the market reaches a short term low, they panic, and sell their funds. Thus the title of my post today.
Joe
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I usually don’t post on Sunday, so this post is going to be a bit off topic, a few general thoughts. First, I’m happy to see readership growing over the past weeks,
as well as steadily over the past 6 months.
I’ve gotten many comments, most of which are positive, all of which are welcome.
Recently, I’ve started posting about the Money Merge Account, and my feelings regarding that product. Lest this blog turn into my soapbox for ranting, I’ve decided to commit to a steady pattern of posts on Mon/Wed/Fri as I’ve been maintaining, and when I have more to say regarding MMA, I will add an extra post on either a Tuesday or Thursday. Other than that, I am trying to vary post topics, so technical, limited interest topics affecting a tiny percent of taxpayers will not appear more than every few weeks. I think there’s a need to bring those topics up as obscure as they may be. As always, your input is welcome and appreciated. Questions, and/or topic suggestion are always welcome.
Joe
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