My favorite posts of the week

Note: I have no idea how to change the headings to blue when they are links, so I put blue block quotes to denote links.

As I continue to write content worthy of my readers I will sometimes post some of my favorite posts for the week. It takes time to write great content, so in the meantime, I will share great content from other writers. I also enjoy reading styles of writing on different subjects that had some sort of impact on me. The blogosphere has some great writers.

Favorite Post One

I was featured on Sarah Brumley’s blog lemonblessings.com on my finances. There are others who were also highlighted, so I thought I would start with her post. Well worth a read.

Here is a tease from the article

(bias noted: It is from my interview)

“If you could go back and tell your young adult self how to handle finances differently in the future, what is the one thing you would most like to share?

Start saving earlier and more. There is nothing like compound interest.”

Click on the link to see more.

Favorite Post Two

A colleague of mine, another one of those accountants (like me), who works for another one of those government institutions with generous pensions (not like me), is about ready to retire. He called me and asked my opinion on variable annuities his financial advisor was advising him to purchase.

Now understand, my friend has a pension that pays 60% of his exit salary. I asked him if his pension covers his fixed expenses or as some would say the floor, the minimum expenses one has to spend for survival.” He said yes, so I quipped, “you don’t need an annuity – you need a new advisor.”

What kind of an advisor advises his client to buy an annuity of any kind when he already has his expenses covered. This has been my problem with advisors. There is a fiduciary responsibility to work for the best interest of the client, but some advisors fail miserably in that regard.

An annuity especially a variable annuity is loaded with fees to fill the pockets of one person, the financial advisor. Only an unscrupulous advisor would have advised my colleague to purchase a variable annuity. He would have paid 6% upfront fees on this particular annuity, and that was only the beginning. There is a place for annuities in a portfolio depending on one’s circumstances, or if a client desires the security of a steady stream of income. Fees should always be a consideration when and if a client purchases an annuity.

My colleague can afford to take on more risk than the average retiree because his expenses are already covered, and when he reaches age 66 or 70 as the case may be, he receives another annuity, Social Security. At that point in time, he will have a steady stream of income that exceeds his fixed expenses. if only we were all so lucky.

“A few weeks ago, I wrote a piece on the ten reasons why you don’t need a financial advisor which was featured in Rockstar Finance.

Michael Dinich, a blogger and financial advisor took issue with it.

I have never used a financial advisor during my investing career, but I do realize that there are times when a good financial advisor might be needed like in the above situation, but make sure if you hire a financial advisor, he or she has a fiduciary interest in the client.

Michael Dinich of Your Money Geek is one of a rare breed that does take an interest in the client. So if you need a financial advisor, Michael details out how not to be screwed over by your financial advisor. Click on the link below.

Favorite Post Three

This one hit close to home. It is a guest post from ESI Money by Jim from route to retire. He talks about the desire to retire with the resources he needs but still afraid to pull the plug. He calls it the one-year syndrome. My wife (I am already retired) will retire in one year, I can hear it now, “Just one more year honey, that´s all, then we will have enough to retire.” I think for my wife the one-year syndrome has lasted ten years. Much I think has to do with the unknown and the fear of what might happen if everything goes to hell in a hand basket..

We want certainty in an uncertain world.

In my post, Three Million Dollars May Not Be Enough to Retire (another great read) I say, “It is no wonder that when the UBS surveyed 2,215 investors, The Street reported roughly half of those with one million to five million dollars in the bank are afraid that one major setback could cause them to lose their wealth.

So why are we afraid to retire when we have sufficient resources? because of the fear factor.

We have now set a date for my wife to retire – but you will have to read my upcoming post on that.

Click on the link to read this great post

And while I am at it. let me add an addendum. I had the honor to host Michael Dinich’s best of the web for some more great reads

from Your Money Geek hosted by yours truly (that would be Me)

I hope you enjoy reading the latest posts. Have a great week

“Money may not buy happiness but lack of it will almost guarantee misery”

Mark

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