AK Steel Holdings Corporation

Butler Works is located on 1,300 acres in western Pennsylvania, an hour drive north of Pittsburgh.

I was born and raised in a steel town. People graduated from my high school and drove down to the steel mill and got a job. Their parents did the same. They got a job, got married, raised a family, and bought a house and a car. Life was that simple. People thought that their way of life would never change. Then came the late 1970s when they started shutting down the steel mills in the Pittsburgh area. We went from 33 mills to 3 in just a matter of 30 years.


But there are surviving steel mills in the United States that managed to recreate their business and specialize in steel products. One such company is called AK Steel Holdings Corporation (Stock Symbol: AKS on the New York Stock Exchange). AK Steel produces flat-rolled carbon, stainless and electrical steel products, as well as carbon and stainless tubular steel products, for automotive, appliance, construction and manufacturing markets.

The major plants and office locations are in Middletown, Coshocton, Mansfield, Walbridge and Zanesville, Ohio; Ashland, Kentucky; Rockport and Columbus, Indiana; and Butler, Pennsylvania.

AK Steel’s key customers are the major automakers, as well as key producers in the appliance, construction, manufacturing and electrical equipment industries.

AK Steel (NYSE: AKS) announced that its board of directors has declared a quarterly cash dividend of $0.05 per share of common stock, payable on June 8, 2012 to shareholders of record on May 15, 2012. If they pay 5 cents per quarter that will be 20 cents per year. With a current price of $7.14 (price as of 12:50 PM, April 25, 2012) that gives you a yield of 2.8%. That is not bad today for a stock.

However, I would buy the Ak Steel Corp 8.375% of Apr 1, 2022 bond. It is more secure than AK Common Stock. The bond is rated by Moody’s at B2 and Standard and Poor’s at BB-. The Cusip Number is 001546AM2. At this price of $976.40 for about 10 years, you the Income Investor makes out better than the stock speculator. In order for the stock speculator to do better the speculator must wait until the stock doubles in price and you the speculator sells at its doubling price.

If the bond is called early from April 1, 2017 (earliest that it can be called) to April 1, 2022, they must pay the investor $1,040 per bond.

If bought on Oct. 1, 2012 and kept until maturity, you the investor would get $711.88 in interest and $23.60 in bond appreciation for a total of $835.48 per bond. You the investor only paid $976.40 per bond.

Do you want to make more? Buy the bond before Oct. 1, 2012. This sounds good for someone with a self-directed IRA. Your profits in an IRA is tax deferred. Personally, I do not own this bond or its stock.

You Never Talk About Gold

Well I am now! To be a gold investor, you better be informed about the Gold Market. Gold-related Investments are on the rise. Historically speaking, the value of gold-related investments fluctuates even more than the stock market according to the North American Securities Administrators Association (NASAA).  In the past 50 years, gold often moved in reverse of stocks and bonds. When stocks are down, gold seems like a very tempting investment. Before jumping onto the gold bandwagon and becoming a “gold bug,” there are a few things you might want to consider.

1.       We have multiple ways to invest in Gold. Investors can put money into actual gold metal or gold-related market investments such as close end mutual funds, open end mutual funds, futures or gold mining companies.

2.       Some mutual funds contain gold. Although several funds have gold in their name, very little gold will be found in them. As a matter of fact, no more than 10% of the assets invested in the metal are contained in the fund. That is because mutual funds by law must earn 90% of their income from securities. Metals are commodities. Metals are not securities. 

3.       Gold mining stocks are volatile. Purchasing stocks in a gold mining company is more volatile than purchasing physical gold because of the risks associated in discovering and mining the metal. Mining companies’ profits are leveraged to the price of gold, meaning that if the price rises by a certain amount, earning should jump by a greater percentage. If however, the price of gold were to decline, investors should expect to see mining companies’ profits decline in similar fashion.  Be careful of fraudulent gold mining companies that exist solely for the purpose of taking investor funds.   

4.       What about Gold as an exchange-traded product? An investor purchases a share in a trust and the shares represent ownership in physical bars of gold. Each share claims ownership of a small portion of actual gold. These trusts may have hidden costs that dilute the holder’s interest in gold. Investors having an investment in a Gold exchanged Traded Fund (ETF) may be subject to higher rates of taxation than other types of mutual funds. If taxes are an issue, you should review the prospectus and contact a tax consultant. 

5.       Should you use the Internet to purchase gold? As with any online transaction, know who you are dealing with.  Be sure they are a reputable dealer.  When researching bullion dealers, you must exercise due diligence because no dealers are authorized or affiliated with the United States Mint. 

6.       Buying Gold CDs, is it a good investment? These CDs can be as illusory as “Fool’s Gold” according to NASAA. Gold CDs differ from traditional CDs because they are tied to the price of gold. Many banks seduce investors with the promises of a share in the rising value of gold. But when the price of gold decreases, the investor only gets back the principal and the interest rate may vary significantly from that of a regular fixed-rate CD. Be aware that each CD has its own formula to calculate interest rates and its own set of rules for when the investor can sell the CD prior to the maturity date. 

7.       I heard that gold is a safe investment. An investment in gold is not foolproof. Gold investors must know their investment objective.  Gold prices fluctuate dramatically so they are not good for long term investment returns. 

8.       Don’t catch gold fever! Gold attracts a crowd of gold promoters who want to take your money.  Some may offer shares of gold exploration companies with beautiful reports and maps. In reality, they are into little or no production of gold. They just have an appetite for your money.

9.       Beware of gold investment scams. The first scam: Some promoters will offer to sell actual gold bullion and retain it for you in a secure vault. Later they promise to sell the gold for you at a higher price. Many times, the gold never existed. Always take delivery of the gold before you place it in a vault under your control.  The second scam: When purchasing gold coins, make sure that it is gold and not gold colored coins with no monetary value. Make sure that you are dealing with a dealer licensed by your state securities regulator. 

10.   Can I buy gold in my IRA? Individual Retirement Accounts (IRAs) make it possible for investors to buy gold with funds that they already have.  Gold must be insured and physically shipped before going into storage. The metal must be physically stored through an approved depository, meaning investors cannot keep coins in a closet or in the trunk of someone’s car. 

If you want to learn more about gold investments contact your state securities commission. In Pennsylvania contact the Pennsylvania Securities Commission at 1-800-600-0007 or www.psc.state.pa.us

What You Should Know About Selling Precious Metals

Gold, Silver, Platinum as well as other household popular metals are known as Precious Metals.  Because of the recent soaring prices of these metals, buyers have popped up all over the country, wanting to buy your old or used silver and gold. They promise you top dollar for it. Some just send you an envelope in the mail and asked you to send your precious metals to them and they will send you “Top Dollar” for it. Some have found out that they sent them gold and got back enough to buy a cheeseburger on the McDonald’s $1.00 menu.  

Before you decide to sell your valued possessions, you should arm yourself with some basic information.  Because I live in the Commonwealth of Pennsylvania, we will go by Pennsylvania laws and regulations.  Unfortunately, the state and local entities charged with enforcing these laws and regulations have been pretty much missing from enforcement. Be advised that you are on your own.

So the following are some basic recommendations to follow if you decide to sell some of your valuables or heirlooms.

1.      Ask the Precious Metals Dealer if they are currently licensed with their county sheriff. If they say “no” or “I don’t know” then your next step is to leave.

2.      Ask the Precious Metals Dealer where they keep their current prices for gold, silver, and platinum. If they are not posted then your next step is to leave. 

3.      If the dealer is going to weigh your product, make sure the scale is visible so you can observe the weighing operation and make sure the scale bears a current seal of approval from the “Dept. of Weights and Measures.”   If either of these requirements is not met, your next step is to leave.

4.      Most consumers are not familiar with the metric or troy systems of weights and measures. Therefore dealers are required to post a conversion chart. That way the consumer has a chance to understand exactly how much their product weighs and how much they are being offered for it. No conversion chart then your next step is to leave.

5.      If the Pennsylvania requirements are met and you decide to proceed with the sale, make sure you receive a complete and descriptive receipt of your sell. Pennsylvania law requires the dealer to provide a receipt that includes;

a.      The name, age, and address of the seller

b.      An accurate description of the product including its weight

c.       Records are to be kept by the dealer for a period of one year and be available for inspection.

d.      A copy of all receipts must be submitted to the County District Attorney within 24 hours of the transaction.  

6.      All precious metals purchased by a dealer shall be kept in unaltered condition for a minimum of five days and be available for inspection upon request.

7.      Before you start this process with the dealer, it would be a good idea if you went to a few local jewelers to establish a baseline weight and value of your metals. 

8.      It is never advisable for you to send your precious metals off by mail to some unknown metals dealer. If you want to be ripped off, that is the best way to get it done!

Dean F. Ely, Executive Director of Pa. Association of Weights and Measures www.pawam.org suggests if you live in Pennsylvania and you have a problem or need to lodge a complaint, contact your local District Attorney, sheriff, or the local police. You can also call the State Attorney General’s Office at 717-787-3391. The number for Weights and Measures is 717-877-837-8007.   If you live in another state or country, contact your Governor’s office for the laws governing your state or country.              

The Investor Traps

How many times have you fallen for the friend who came up to you and ask if they can borrow $10? They claimed that they will pay you back on Friday. The problem, they did not tell you what Friday in what year.  On Friday, May 18, 2012, I woke up to hear on the Financial News Network that Facebook was going public. On every TV station they talked about Facebook going public. A person at work asked me if I thought Facebook would be a good investment. I told them that Facebook is going to be “the biggest pump and dump in History.” It was priced at $38. Then on the open it was $42.05 and closed the day at $38.18.   By Monday May 21, 2012 at 10:00 AM, the stock sold at $33.00. I woke up on Wednesday May 23, 2012 at 7:00 AM and found that Facebook was selling at $30.45 in after hours trading.

Above is a picture of a succubus. I often fall for the cute ones that cost me the most money.

Someone got the national media to hype the stock while the people holding the original shares dumped the stock on the unsuspecting public.

I gave you two examples of investment traps that people encounter every day.  The first is the one-on-one trap. You know the person so you feel comfortable investing in them. The second, because it is on TV, it must be an approved safe venture. So you feel safe investing in it.  We are going to spend some time going over the top investment traps that people will attack you with.

The Distressed Real Estate Schemes. You seen the infomercials on TV, you can become rich just by picking up some properties dirt cheap, fixing them up and renting them out. Investments in property that are bank-owned, in foreclosure, pending short sale, or otherwise in distress carry substantial risks and should be evaluated carefully.  On the high end, promoters may come to you with Real Estate Ventures. They must be registered with the state or federal securities regulators.  Check them out before doing anything. 

Energy Investments. When I was younger, people always tried to swindle me into Oil and Gas Limited Partnerships. Swindlers use high pressure marketing tactics touting the mystique associated with untapped oil and gas reserves and bountiful production runs.  Genuine oil and gas investments almost always bare a high degree of risk. In these ventures you can stand to lose your total investment. These ventures are poor alternatives for those planning for retirement. 

Precious Metals. With the advertising of higher precious metal prices and the promise of an appreciating asset, many unsuspecting investor have been lured into a variety of scams. Sometimes the promoter seeks capital for purchasing equipment to open dormant mines. People are always selling gold, silver, and precious stones that are not what they appear to be.  Plus there are no guarantees with gold or other precious metals in any market, even the legitimate ones.

Promissory Notes. These IOUs are usually sold by small businesses. They are very speculative and many times they are not paid back. Even legitimate notes carry risk that the issuers may not be able to meet their obligations.  These notes are often pitched as personal loans or short term business arrangements. Investors should be aware that Promissory Notes should be properly registered with their state or federal regulators.

Securitized Life Settlement Contracts. Life settlement contracts are investment in the death benefits of insurance policies that insure the lives of unrelated third parties.  This is an area were professionals that specialize in this field have problems with. I suggest that you stay away from this type of venture completely.  

         

Affinity Fraud. When someone approaches me and says that they want me to help them sell a product or service to Blacks or Native American people, my guard goes up.  Marketing a fraudulent investment scheme to members of an identifiable group or organization is a highly successful and lucrative practice for Ponzi scheme operators and other fraudsters. In the past 10 years, one in four frauds was marketed to affinity groups. They especially like to pick on the elderly, retired, religious, and ethnic groups.  

Bogus and Exaggerated Credentials.  Investors should press for full disclosure and the meaning behind all designations behind the professional’s name. If you are suspicious about claims of credentials, you should talk to your state regulators. Many people claim to be experts in the field but have no real training to prove it. This maybe your first clue that you are being sucked into an illegal scheme.    

   

E-Trading.  The securities markets are constantly evolving to provide investors, speculators, and gamblers with new products, different platforms, and a variety of choices. People should be careful of the potential of fraud. Always review your trades. Know what the security that you are buying and sell is trading for before you get involved.  Make sure that you change your passwords on your accounts at least every three months. Never give out your Account Number, ID and password to others.  

Private Placement.  I buy Over the Counter (OTC) Corporate Bonds on a regular bases. However, I buy them with the knowledge that I may not be able to sell them. I wait for them to mature. Investors should be aware that, in the case of legitimate issuers, private placement offerings are highly illiquid, meaning that they generally lack transparency and have little regulatory oversight.  Scammers and unscrupulous promoters use securities that are not sold on exchanges to dump worthless stock or bonds on people for cash.  Invest in this area after doing plenty of research. 

Securities and Investment Advice Offered by Unlicensed Agents. I know of a person that decided to open an IRA with an insurance salesman that they met. The salesman sold insurance but wanted to manage the money that this new client had. He misrepresented himself to the client and sold the client a whole life insurance policy with high mutual fund hidden fees and long lock-up periods to cash out of the funds. This person started with $150,000 and when they found out that they had been scammed, they had $72,000 left.  Investors should insist that anyone giving investment advice give them information on their qualifications for doing so as well as the fees involved in buying, holding, and selling the investments in question.   

You the investor, trader, speculator, or gambler must be aware of your situation at all times. Many scammers set traps for unsuspecting people. The scammer’s objective is to relieve you of your hard earned money.          

Financial Fraud is Elder Abuse

 The Late Clara and The Late Tom Porter

If you love your parents, grandparents, and other elderly relatives than you will read this blog and act accordingly. You may not know it but your elderly relatives are a target of many scam artists around the world. From your twenties to middle age, increasing knowledge and experience makes you a better decision maker.  But studies show that, on average, things turn around a few months after you turn 53. From then on, the chances of making a financial blunder or being taken in by a swindle, increases.  A 2010 survey found that one in five people over 65 years old have been ripped off.  It is believed that more than one third of Americans over age 71 have mild cognitive impairment or Alzheimer’s disease. Here is the reason why the elderly is the main target of swindles and other financial abuse. Knowing this, just think how desperate many old people are with savings accounts giving near zero interest and a volatile stock market.  

In my opinion, the lack of financial education in America has already set the stage for any scam artist to come in and take your money. It does not matter if they are in a large business or they are some door to door scammer.  So when these people become older Americans they are already prime to be victims of financial swindles and millions more are in danger of being exploited. The elderly today grew up in the 1930s, 1940s, and 1950s. They were generally raised in a time of politeness and trust.

In what areas do these scammers pray on the elderly?

Annuities. Many insurance sales people live off the elderly.  Annuities which promise tax-favored growth and lifetime income can be terrific. On the other hand, they can be lousy deals if the seller is more interested in pocketing an outsized commission than in the buyer’s well-being.  An Annuity may offer your mother a 7.8% yield. They will continue as long as your mother is alive. However, the payment that you receive is a combination of earnings and a return of part of your investment. So you are not receiving 7.8% but maybe 1% to 2% return.  Now this could be a sound investment but only if the buyer fully understands what she is getting into. 

Telephone Fraud. We have all gotten the phone calls around dinner time with someone selling something that we do not need. According to the FBI, people over 60, especially women living alone are special targets of people who sell bogus products and services over the phone. Many call about charitable contributions or that they won a prize. Some claim that they are from the bank and want their account number and other information to fix a problem.  

Mortgage Fraud.  I used my computer to look up the current mortgage interest rates. What I got back was a rash of phone calls wanting to help me with my mortgage problem. All I wanted to know was the current mortgage rate. The collapse of the housing market made fertile ground for scams aimed at desperate homeowners. Many of these scammers promise aid for homeowners threatened with foreclosure. Some claim that they can sell your property quickly. They take your fees for services that they never performed.  

  

The Nigerian Letter. This is my favorite scam. I know of a man that lives in the rich neighborhood of Camp Hill, Pa. that was taken for $20,000. In this scam a government official from Nigeria or some other African or Asian country contacts you by email, letter, or phone. They want help in transferring millions of dollars to the United States to your account. They get you to front cash to cover expenses such as taxes, legal fees, and bribes. They claim you will be reimbursed and you will be well rewarded.  They get your money and you never hear from them again.

Free Lunch Seminars. When I was in my 30s and 40s, I was always invited to free lunch and dinner investment seminars. These seminars were always followed up by high pressure sales calls. The elderly are targets of such financial threats.    

Magazine scams. Be careful of any phone sales pitch for free or prepaid subscriptions to magazines. Your elderly relative may think that they are going online to get information and find themselves secretly signing up for over $100 in magazine subscriptions.   

  What can you do about this?

 The Late William J. Williams II and the Late Jean J. Williams

Start by talking to your elderly love ones to make them aware of the threat. Don’t wait for them to alert you to the problem because by then it might be too late. If they realize it, they may be ashamed to admit that they fell for a scam. They may believe that the incident may lead to a loss of independence.  Tell your parents that you want to protect them against scammers by helping go through their mail. Get copies of their credit report using “Annualcreditreport.com” to make sure they aren’t victims of identity theft.  Put them on the “Do not call list” at 888-382-1222 or www.donotcall.gov.     

Conspiracy is a Bad Word!

The 99% of the people in the world are manipulated and they don’t know that they are or don’t care that they are. Many people who point this out are told that they believe in conspiracies, like the word conspiracy is a dirty word.  It does not matter how many times I show people that they have been manipulated and it has come back to bite them in the ass. They still cling to believing that conspiracies that affect them do not exist. Let me give you a few example of what I am talking about.

The day of 9/11, planes crashed into the Trade Towers in New York City. Before the second Trade Tower fell, the federal government had a spokesperson on each network and major cable TV stations telling the public who hijacked the planes and about the terrorist leader Bin Laden.  We never saw proof of any of this. Because of this, the United States passed many laws taking away personal liberties and suppressing civil rights of individual citizens. Just to go to Canada and visit the falls, you now have to have a passport that may cost you over $150. The United States invaded Afghanistan like the Russians, the French, the British, the Persians, and the Mongolians before them. Our excuse, they had Bin Laden and would not give him up.

Ten years ago, I said that this war will cause our schools, cities, and townships to suffer because the federal government will use all the money to support the war. I was told that I did not know how the government works. Money used for supporting local governments comes from a different pot, my critics argued. Well, 10 years later and we have local governments around the country filing for bankruptcy. School Districts laying off teachers and dissolving school districts. The reason, state and federal governments have withdrawn the money. Why, because the war over the years and the depression has drained the federal budget.  

Hey they found and killed Bin Laden! Problem, you did not see the man in public for over 10 years even before 9/11. They showed you old videos from when he helped fight the Russians in Afghanistan. They did not bring back his body. They did not take pictures of his body and place it on "Live TV" for everyone to see. And they dumped his body in the ocean so no one will ever see.  Now tell me, was Bin Laden alive when the Trade Towers fell? Was Bin Laden alive when he was killed by US forces? Or was this a conspiracy for a few people to get what they wanted around the world? I bet they are working on giving the public a new “boogie man” to fear. You will see him on the news soon. 

In the early 1990s, Iraq invaded Kuwait.  The news told us that Saddam did this because he wanted Kuwaiti oil to pay his debts. Kuwaiti women were paraded in front of congress to show how Iraqi troops raped them as well other Kuwaiti women. What they did not tell congress or the TV public was the fact that these women were not in Kuwait at the time of the invasion. They were in the United States and they are part of the elite ruling structure of Kuwait. The British are the people that complained to the United States about the invasion because they controlled the oil wells in that country.  The Iraqi government was a main buyer of American weapons. In fact, the coalition of nations had to fit their equipment with special gear so that they could tell Iraqi equipment from coalition equipment.  The coalition removed Saddam from Iraq. The first George Bush was the one who placed Saddam in power decades before to keep the peace in Iraq under Western control. Now why did Saddam attack Kuwait in the first place? Because the leader of Kuwait insulted the women of Iraq, calling them prostitutes.     

In the second war, they told us that Saddam had weapons of mass destruction and they were aimed at us. That is why we invaded Iraq, just to find out that they had nothing at all that threatened the United States. But that did not stop the rich upper class from taking over the Iraqi oil fields and controlling their oil in our name.  

I have been in the stock and bond markets since 1972 so I know how laws and the markets have evolved over the past 50 years.  When I got started, mutual funds were not the investments that brokerage firms pushed. In fact, people were not pushed into the stock market unless they had a job that could support such activities. Mutual funds were an investment that was sold by mutual fund companies. Then congress passed a law allowing people to save for retirement.  The brokerage firms stopped pushing individual stocks and started pushing mutual funds. They stopped giving information on the bond market and some told small investors that they could not buy corporate bonds. Then they advertised that buying bonds was a very dangerous and speculative gamble. They channeled the public into spending far more money in management fees than they knew about. As long as the market was going up, no one cared until one day, the stock market dropped, Mutual Funds died, and brokers did not answer the phones when clients started calling. Just like from 1929 to 1940, the banks failed, investors went broke, and people lost jobs. 

What happened! The heads of banking, brokerage, and insurance went to congress and convinced them to abolish the “Glass–Steagall Act of 1932.”  That act was put in place to keep these three industries and the Real Estate Markets from manipulating customers and the markets.  A few people got rich off of a world of misery.  Campaign contributions manipulated the politicians and corporations manipulated the public. As a result many people who saved for years had no money in a matter of days.  They were robbed and could not call 911 to complain.      

So yes, we do have conspiracies and they are aimed at you. Here is a video that explains how you are the target of such conspiracies.   

Let’s go to Annuity Class!

As I look around I find more and more people who are not ready for retirement. I find even more young people who are not thinking about a retirement plan. Yet, I see people who retired but find themselves having to find work in just a few weeks because they have no retirement money. Last, I find people who talk about how they know all about how to invest for retirement just to find out that some sales person have taken them for everything that they saved for over the years.

In this class, we are going to learn about an insurance contract called an Annuity. We are going to learn what they are for and why it is important for you to know about them even if you feel that you don’t need one. In fact, if you are working or have a Whole Life Insurance policy, you probably do have an annuity. If you have a pension or contribute to a pension with your employer chances are you have an Annuity. If you have a TAP account or any type of government education account then chances are you are in an Annuity.

It would be to your advantage to take an hour out of your life to take this course on Annuities. You can take it a little at a time. There are 7 segments to this course that run from about 4 minutes to almost 13 minutes long. Watch it with your family or your spouse. You can stop the video when taking notes. When finished, you can ask your insurance agent or investment advisor any questions about your own investments concerning Annuities. The idea is to know as much as your experts so that you cannot be cheated out of money.

This course can save you tens of thousands of dollars in the long run.

Pros and Cons of Annuities: Questions and Answers (part 1 of 7) 10 Minutes 35 sec.

http://www.seniorannuityalert.com/questions-and-answers/

This is an introduction to Annuities. Here you are going to learn the four (4) types of Annuities and how to determine the right Annuity for you and your family. A highly qualified Financial Planner and Annuity expert will explain this insurance product to you.



Pros and Cons of Annuities: Immediate Annuities (part 2 of 7) 4 minutes 1 sec.

http://www.seniorannuityalert.com/immediate-annuities/

This Video is about Immediate Annuities. This is the traditional investment vehicle used for Pension funds. The longer you work for a company giving you this Annuity the more money you will get when you retire. The beneficial IRS Tax rules are discussed. Some Annuities run out in 10 years others never run out. The problem with this type of Annuity, you lose control of the money and when you die, the money stops.



Pros and Cons of Annuities: Fixed Annuities (part 3 of 7) 6 minutes 8 sec.


http://www.seniorannuityalert.com/fixed-annuities/

This video is about Fixed Annuities. These Annuities are usually tax deferred but the fix rate can be adjusted from one year to another. The instructor talks about why it is not a wise thing to do when you the investors buys a Fixed Annuity and places it in your IRA. He talks about how the fixed Annuity is insured.

Pros and Cons of Annuities: Variable Annuities (part 4 of 7) 9 minutes 56 sec.

http://www.seniorannuityalert.com/variable-annuities/

This video is about Variable Annuities. Here the instructor talks about the administration fee, Life Insurance Fee, and the Rider fee. He also talks about the tax consequences of using this investment vehicle. Most people do not know that this Annuity can drop in value if the money is withdrawn. It only has a floor when the owner of the Annuity dies and it turns into a Life Insurance Policy.



Pros and Cons of Annuities: Index Annuities (part 5 of 7) 9 Minute 22 Sec.


http://www.seniorannuityalert.com/index-annuities/

This video is about Index Annuities. Here the instructor makes you aware of the CAPs put on the Annuity by insurance companies. Insurance companies vary on how they treat CAPs.



Pros and Cons of Annuities: Fixed Index Annuities (part 6 of 7) 11 Minutes 38 Sec.

http://www.seniorannuityalert.com/hybrid-annuities/

This video is about Fixed Index Annuities. Inflation at some time in the future will be coming back. You don’t want to take on inflation risk. If you do and inflation becomes a problem, you will not have enough money to live on. People who neared retirement in the late 1950s never thought about inflation. But inflation went as high as 14% per year by 1980. These people who retired in the 1960s and 1970s lost a great deal of purchasing power by the 1980s and many did not have the money to live on.



Pros and Cons of Annuities: Conclusion (part 7 of 7) 12 Minutes 35 Sec.


http://www.seniorannuityalert.com/annuity-conclusion/?elq=fc395dea1a50444cb3d007dfd64a067e

For people in their 60s who are looking for Income and safety who still want to control their money, you have to do research. This video goes over what questions to ask insurance companies. If you already have an annuity and you are unhappy with it, this video goes over what to do about it.

Class is conducted by;
Josh Mellberg
JD Mellberg Financial
1-877-505-1960 


How Banking has Changed!

This is Darnell's cash outlay for the month of April 2012.

The information above was automatically generated by my bank.


I can remember back in the 1950s, my father took me down to 8th and Amity in Homestead, Pa. to open a savings account at People’s National Bank. I was about the same age as my grandson Daniel and acted just like him. I opened my checking account at age 19 at that same bank. Banking has changed in the last 50 years. They posted my deposits and withdraws in my savings book. They also posted my yearly or semiannual interest in my book. We did not have personal computers to help us with that work. The bank used a very powerful computer, state of the art at the time using 8K of memory and filled a large room. Today, your cell phone uses far more than 8K of memory.

At least every month and sometime twice a month, I would have to balance my check book, accounting for all outstanding checks and withdraws. I would have to post my checks that I wrote in my check book. Plus I had to make sure that I posted all deposits including my paychecks. If you did not balance your check book, chances are that you will over draw your checking account and pay as much as $50 per bounced check. If you did not want to pay these fees you better maintain a balanced check book. Many banks started charging a fee just to have a checking or savings account starting in the 1980s.

It is 2012 not 1962 and I have not had to balance a check book in years. Because of computers at home and in the banks, all that is done for me. I can use my computer at home or at work to monitor my banking activities. My bank keeps up to the minute all my deposits and withdraws. I write very few checks but even these checks are credited to my account within two weeks. I just keep track of the checks that I write and wait until they show up in my account. In the month of April I wrote two checks. I mailed one check to pay for my car insurance. That one took a week to show up in my checking account. The other was because I needed cash so I wrote myself a check and cashed it at my bank, it showed up the next day. I have my rent and utilities taken directly out of my checking account. When they do, it shows up the same day.

So you may ask, what about the rest of my bills such as food, gas, car maintenance, eating out, clothing, and etc.? I use my credit card. My credit card company takes care of all my transactions. I can logon to my credit card account and see what and how much I spent on credit. I stay within a monthly budget and this helps me maintain that budget. In April I spent $1,686.25 in everyday items. That is 59% of all my spending for the month. My rent was only 24% and my utilities were 3% due to the warm weather in March. I can check each of these categories individually at any time that I want.

This is how banks changed and did not tell you about it!

Click on this short news video and see how the bank slowly put it to you.

http://www.huffingtonpost.com/2012/04/27/robert-whitten-bank-of-america_n_1458788.html?icid=maing-grid7%7Cmain5%7Cdl4%7Csec1_lnk1%26pLid%3D155914

How much does all this cost?

Most people pay monthly for a checking account. They pay as much as 36% interest on their credit card account. So many people are paying as much as $300 or more per year just to use their own money.

Except for individual checks and cash, all other money such as Pension and Paychecks are deposited automatically into my checking account. I move money  in and out of the brokerage firm. I buy everything with a credit card and the bill is paid by the bank automatically once a month. The bank pays my rent and utilities automatically once a month. I can monitor banking, brokerage, and credit cards at any time of day. Money is moved to my savings account from checking twice a month automatically. Not only is all this done for free but my brokerage firm, bank, and credit card companies pay me cash for being a customer.

I use a checking account from a bank that gives me free checking. I pay off my balance on my credit card every month so my credit is free. A benefit of that is that my credit rating is and stays above 800 points and I can buy whatever I want or need without the worry of my credit being not good enough. I get cash back from my credit card account that I place into my checking account once a year. In April, I paid less than $1 for postal stamps.

I set my checking account up to place money in my savings account every time I get paid. At the end of the year, I take that money and place it into my IRA and buy bonds giving me 7% to 20% interest. That interest is tax deferred. The yearly contribution money that I put into my IRA, I deduct it from my yearly income that I report to the IRS. That reduces the taxes that I pay and that savings goes back into my savings account for next year’s IRS contribution.

So in my banking situation, the credit company pays me, the bank pays me interest, the IRS pays me, and the corporations that I invest in pay me.

The question that you should be asking yourself, are you paying people for you using your own money or are they paying you?