James C. Molet's Blog, page 80

Avoid High Fees

Rightfully so, 401(k) fees are coming under increased scrutiny lately.  Back in late April, PBS Frontline presented “The Retirement Gamble” (in our Recommendations section) which noted that retirement is big business in America as there is a lot of money at stake.  High management fees for mutual funds can put a serious dent in investor’s retirement accounts.  Now, Yale University professor Ian Ayres has gathered data regarding plan costs of nearly 50,000 companies and intends to publish his research in spring 2014.  Every indication is that the report will be damning Read the Full Story

A Case Study in Ethics

Book: The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron (2003). I was introduced to this book during the pursuit of my MBA, in an ethics class, which used this book as a case study on the topic. A more appropriate book for the topic probably could not have been found. Available in multiple formats – including a recently released Kindle Edition – this book chronicles one of the most chilling business scandals in history. Authors Bethany McLean and Peter Elkind delve deep into the Read the Full Story

Annuities

During the course of previous discussions, we have identified three general stages in an individual’s investment lifecycle: building a fiscal foundation (conducted during your 20s and 30s), accumulating wealth (occurring between the early 40s and mid-50s), and pre-retirement, the five-year period prior to your desired retirement age. During the pre-retirement stage, debt is eliminated and a plan – considering the withdrawal rate (e.g. the 4% rule) and the order of withdrawal from the various retirement accounts – to draw down the retirement nest-egg is developed. With a sufficient nest-egg in Read the Full Story

Your Rendezvous With Retirement

In my book, RENDEZVOUS WITH RETIREMENT: A Guide to Getting Fiscally Fit, I lay out a six phase process for getting fiscally fit and preparing for a comfortable, secure retirement. The phases include: honestly assessing your situation and making adjustments, conducting preparatory actions, determining goals, investing, tracking investments, and drawing down your nest-egg. Honestly assessing your situation and making adjustments involves analyzing your monthly expenses, reducing those expenses as much as possible, and increasing income. Conducting preparatory actions involves managing your budget, establishing an emergency fund, educating yourself on personal Read the Full Story

Living Frugally: Disregard the Naysayers

I was recently exploring several personal finance blog sites I subscribe to and have noticed a pattern among the comments in stories about us frugal folks. We constantly run into opposition and misunderstanding from those who do not quite get our non-traditional mindset. We are spoken to rudely or given weird looks by those who don’t understand our decision to go against the grain. Some of us, like Green Money Stream, grow our food instead of buying it and do not buy things like Twinkies for our children. Upon learning Read the Full Story

An Historical Thriller

Book: A Conspiracy of Paper (2000).  This book was my first encounter with a fictional historical thriller…one I thoroughly enjoyed!  The following description is taken from Author David Liss’ website: Benjamin Weaver is an outsider in eighteenth-century London: A Jew among Christians; a ruffian among aristocrats; a retired pugilist who, hired by London’s gentry, travels through the criminal underworld in pursuit of debtors and thieves.  In A Conspiracy of Paper, Weaver becomes entangled with a crime of the most personal sort, involving the mysterious death of his estranged father, a notorious Read the Full Story

Income Funds

During the course of previous discussions, we have identified three general stages in an individual’s investment life-cycle: building a fiscal foundation (conducted during your 20s and 30s), accumulating wealth (occurring between the early 40s and mid-50s), and pre-retirement, the five-year period prior to your desired retirement age. During the pre-retirement stage, debt is eliminated and a plan – considering the withdrawal rate (e.g. the 4% rule) and the order of withdrawal from the various retirement accounts – to draw down the retirement nest-egg is developed. With a sufficient nest-egg in Read the Full Story

Living Frugally: Focus on the Future

I know several very short-sighted people.  They live for the moment, they don’t plan far into the future and as a result, they are always running low on time, money, and freedom.  Their time is always short because they constantly squander it.  A daily planner is almost a foreign tool in their minds.  They refuse to set alarms with the tools at their disposal (e.g. smartphones) to remind them of important events.  The result is a negative impact on their time, which impacts their freedom. These individuals have no time Read the Full Story

Holiday Charity Contributions

It is always thoughtful if you are in a position to make a contribution to a charity or two; particularly during the Holiday season.  As you consider potential charities, it is worth remembering that there are some definitive do’s and don’ts. If able, do give.  Even a small amount will be appreciated by the charities you choose to contribute to this Holiday season.  Prior to pulling out that credit card and making a contribution, do conduct some research.  Ensure that the charities you are considering are good stewards of the Read the Full Story

Develop Your Withdrawal Plan

Building a fiscal foundation during your 20s and 30s; and accumulating wealth as you enter into your forties are the first two stages of a multi-stage effort for securing a financially sound retirement.  The third stage is pre-retirement, the five-year period prior to your desired retirement age.  During this period, there are two elements to consider:     The complete elimination of debt     Developing a plan to draw-down the retirement nest-egg Up to this point, eliminating debt was a goal.  However, now that you are close to leaving the workforce, Read the Full Story