Goldstein On Gelt

  Even though now isn’t the first time the stock market has fallen by more than 20%, this newest wave of volatility has panicked many investors. There are two common reactions investors have when the market falls: liquidating portfolios (to prevent further losses) or buying more (to maximize potential gains). Can you guess which type of call I’ve received more in recent weeks? While historically stocks have provided greater returns than bonds, there are three times you probably shouldn’t buy stocks: You can’t make ends meet You have no emergency fund You need the money in the short-term The most important thing in weathering the volatility of the stock market is knowing your risk tolerance and building a well-diversified portfolio (even if it includes low-yield investments) that reflects your risk tolerance and financial goals.  If you need help deciding whether you should sell out your portfolio, hold on, or buy additional stock shares, be in touch. Call 02-624-2788 or email doug@profile-f

Bond funds are dropping, and at the other end of the financial seesaw, interest rates are rising. Listen to this podcast to understand the relationship between interest rates and bonds (and bond funds). Basically, a bond is a loan you make to a company/government: You lend money and they promise to pay it back to you plus an agreed upon interest rate. However, after buying the bond, life, the economy, and interest rates might change, and these changes often change the value of your bond holdings. There’s an inverse correlation between bond prices and interest rates. This is because as interest rates increase, the interest you were receiving on an older bond is no longer as attractive as it once was, so if you want to sell the bond/bond fund, you’ll have to accept a lower price in order to find a buyer. When buying bonds, don’t forget to look at two things: both the price and the total return. Sometimes, even if the bond prices go down, the investment may be a good one for you if you collect enough

Traditional investing focuses on individual funds, bonds, and stocks. Top-down investing is actually based on a market overview. But, how does an investor know a trend when they see one? Callum Thomas is the founder and head of research for Topdown Charts, a company specializing in macroeconomic studies. Callum defines top-down investing and explains how data is the most important tool for a top-down investor. He talks about how geopolitical events, could affect data. If you like to stick to the numbers in your financial planning, then tune in to learn more about this analytical investing approach. Coping with the financial aspect of widowhood Doug has put together a one-page resource for recent widows and widowers. The loss of a spouse and tough emotions come hand-in-hand. Many people have the extra stress of financial issues. Doug’s resource Answers to Tough Financial Questions for Widows and Widowers is a primer to navigating the financial side of losing a spouse. Free Download: Answers to Tough Financial

Every investor needs an investment strategy, and there are many good strategies an investor can consider. Do you know your options and what each investment strategy can offer you? Tune in to learn more about the most common choices. Colleen Jaconetti is a certified financial planner and senior investment analyst with Vanguard Investment Strategy Group. She lays out the most popular investment strategies that investors use in everyday investments. She focuses particularly on the “Dynamic Retirement Spending” strategy, an investment strategy that can give an investor “the best of both worlds” in financial planning. She explains what the strategy is and why it is the most balanced option for an investor. The dos and don’ts of a financial windfall Doug has put together a list of tips called The Best Way to Invest an Inheritance: What You Should and Shouldn’t Do with a Windfall.* (*meant as link) He lists all the reasons why getting a sudden windfall like an inheritance can be stressful and lead to bad decisions.

Who is managing your money? Who is giving you financial advice? How do you know you’re asking for advice from the right source? Any financial advice you receive should be customized and personalized to meet your current financial situation. The free resource Is The Right Company Managing Your Money explains how all of your investments should be reviewed and by who. Download the free resource: Is The Right Company Managing Your Money? Recently received an inheritance in the United States? Have you recently received an inheritance from the United States but are living in Israel? Every inheritance is different. Someone may inherit two brokerage accounts and an IRA while someone else’s inheritance is completely different. Know where to find the right advice. What should you do with your inheritance? Receiving an inheritance can be complicated especially if you receive a U.S. inheritance and are living in Israel. But it doesn’t have to be. The Inheritance Book was written for every Israeli citizen that recently r

Just because stocks are tumbling doesn’t necessarily mean that all is lost. Sophisticated investors know how to use a down market to up their portfolio.  Listen to the podcast to learn three ways that you can benefit from a falling market. 1. Pretend you’re a farmer and harvest! Tax loss harvesting means selling stocks at a loss and matching that loss against capital gains to minimize capital gain taxes. No one likes to pay taxes, and no one likes stocks to lose value, but tax loss harvesting manages to lessen the negative blow of two potentially unpleasant situations. While savvy investors often use tax loss harvesting at the end of the fiscal year, you can implement this strategy anytime. 2. Take advantage of the stock sale. What does it mean when the market is oversold? Simply put, it means prices have dropped further than they probably should have. When the markets climb, investors who want to lock in their profits sell their stocks. If too many investors sell at once, the market drops; it is

The funny thing about writing a will is you invest time and effort in its creation, and yet you never benefit from it. If you want to make life easier for your heirs, it is an important document to prepare… correctly. While you work with your lawyer to write a will, keep in mind that at the end of the day, it needs to “work.” By “work” I mean that it needs to make sure that distributing your assets to your heirs goes smoothly and it won’t be challenged by a potential inheritor. I’m not a lawyer, so I can’t advise on the legal issues involved with writing a will. Nonetheless, I have much experience on the practical side of a will, guiding the transferring of assets to the intended. After working for nearly three decades helping people receive bequeathed assets, I have three suggestions of things to include/not include in preparing a will. Listen to the podcast to learn these three practical tips, and then download a pdf that you can give to your lawyer explaining why your will should reflect these

Can money buy happiness?   In this week’s show, Doug and his son, Efraim, discuss spending habits, and if people generally make good choices.  Imagine hearing a financial planner tell you that it’s important to spend the money that you have in order to make you happy. Remember the famous dilemma: should you buy a cup of coffee every day, or should you save those few dollars and invest them so you can buy something bigger in the future? What will make you happier? People who have more money, aren’t necessarily happier than people who earn less. What should you buy to make you happy? Although having an iPhone is nice to have, what studies have shown is that when you donate money and help others, you feel better and more fulfilled. Outsourcing, buying time and delegating tasks is another way to use your money wisely. Have you ever considered spending your money to free up your time so you have more time to do what you like to do?  It’s important to remember that money isn’t the main goal, it’s on

Congratulations!! You just had a child! How can you ensure that they will be financially secure throughout their life?  Today, Doug speaks with Efraim, who is preparing to be a young father, about tips and tricks for the best way to financially prepare for a growing family, and how to educate young children about money, so you can best raise financially savvy kids As parents, we want the best for our kids, but it’s important to remember that a parent isnot obligated to hand over $1M to their children when they grow up. Perhaps the best gift a parent could give their children is to educate them so they will be able to manage on their own. It’s never to young to begin teaching your child about money; even a 5-year-old can understand basic concepts, and as they grow older, they can understand more. Make sure to listen to Doug’s three tips on what to teach your kids on handling their own money. Don’t forget to model good financial behavior for your children, and put aside money for their future need

Everyone talks about the stock market, so you may ask yourself, “Should I buy stocks?” Historically, investing in stocks has been a great way to build wealth. But how do you know how much you should pay for a stock? If the price is always changing, how do you know you’re getting a good deal? It all boils down to the main question: Why should someone even buy a stock at 90 or more times earning? When trying to evaluate a stock, there are many factors to consider. Perhaps the most important point to keep in mind is “what will the future income of the company be?” This week’s show focuses on how to understand a stock’s earnings. Doug and Efraim present easy to follow example, to help you understand the core issue. For example, buying a stock for $10 a share when the returns are $1 per year, may seem like a bad investment (because you lose $9) but, in year 11, you (hopefully) will profit $1. Why are people willing to pay more than what they are getting? Quite simply, it’s because they are optimist

Does the price of a stock really matter? Many people look at the price of a share before deciding whether to buy that particular stock.  Should you follow your instinct and consider the price of a stock before deciding whether to buy it or not?  When buying a stock one of the factors that one needs to take into consideration is the PE ratio, the price per-earnings ratio of the company. The PE ratio is the calculation of how much a company earns divided by the price of the company. Listen to today’s episode to learn how to calculate a company’s PE.   Once we understand why people are willing to pay 10, 30, or even 400 times earnings, ask why should someone do that? If I can pay a cheaper price for a similar stock, why should I buy the more expensive one?  The answer is different people look at  stocks differently. Beauty is in the eyes of the beholder; what is important to one person may not be as important to someone else.  The most important thing to keep in mind is that if the PE ratio is very d

Periods of high inflation are tricky for investors because people don’t know how much their dollars will be worth in the future. Today, Doug talks about the two main myths about how to invest when inflation is high: Buying gold – Some people believe that the price of gold goes up during periods of high inflation. But that’s not always true. Buying real estate - Some people think that in times of high inflation it is a good idea to invest in real estate. Doug explains why it is important to be careful that you aren’t buying into a bubble which is reminiscent of the 2008 crash.  Have you considered that being invested in the stock market could be a hedge against inflation? Equities may be a good inflation-fighting strategy since being in the market when inflation is high is “riding the wave” of the money that’s being pumped into the system. But be careful! Efraim is a business student, former IDF officer, and an entrepreneur, head of “A Day with an Officer.” Contact him at: efraim@goldstein.co.i

If you open an account with Profile Investment Services, Ltd. how does it work and who holds your money? It takes a team to manage your investments, and getting to know the different players and the positions they play is important. Listen to this podcast to learn exactly who does what, and how your investment account works. For Profile clients, no matter what their concern, my wonderful team and I are the first point of contact for any investment related concern. Learn how we work with Portfolio Resources Group, Pershing, Envestnet, Corestone checking, Visa cards, SIPC and FINRA in order to give you the most appropriate investments, top-notch money managers, quick access to your funds, transparency and regulatory oversight, and most important of all, trustworthy and personal attention.

Do you look at the news and think that the world is in crisis? How should you invest when things are looking tough around you?  First, it is essential to break down your goals into short-, medium- and long-term investments.  It is important to understand that short term investments should be held in a less risky portfolio, and the longer-term goals can be exposed to a riskier portfolio. A way to use a crisis to your advantage may be by trying to figure out what are the “bigger” costs to the crisis. For example, in the Russia-Ukraine war, perhaps investing in companies that build the airplanes or supply ammunition, or even looking further and investing in companies (or ETFs) that might be involved in building material for the countries that will need to re-build. A creative investor needs to keep their eyes open and look for clever ways to invest. During times of crisis, investors should keep in mind the size and power of who and what is in crisis. For instance, Russia is a huge country with lots o

When should you let go of financial responsibility? When is it time to delegate some of financial responsibility to your spouse, children, or someone else close? The specific financial responsibilities to be delegated depend on your specific situation. Often they include, giving someone power of attorney, check writing ability, and/or trading authority. Letting go of financial responsibility is a process. The free resource When is the Best Time to Let Go of Financial Responsibility was made for every investor who’s thinking about letting go of some financial responsibility. What financial questions should you ask your lawyer? Legal advisors, tax advisors, and financial advisors have complexly different roles when it comes to your finances. Start asking the right financial questions: What should you do with your will? What should you have in your will? Should you have a will for your assets in Israel and a different will for your assets in the United States? Do you need to have a trust? What are the tax impli

What are the steps you need to take before retirement? What are the critical things you must do before you clean out your desk at work? Hopefully you’ve accumulated a significant amount of savings to supplement your pensions before you retired. But how that money is invested may be even more important than the fact you have savings. An investor should consider their portfolio’s asset allocation and its tax efficiencies before retiring. What kind of situation is your portfolio in? Are your investments growing in taxable accounts or are they in tax-deferred accounts? Should an investor be aggressive in their portfolio or conservative after retiring? The resource Steps You Need to Take 5 Years before Retirement was made for every investor on the road to retirement. Download the free resource: Steps You Need to Take 5 Years before Retirement What happens after retirement? Retirees that stay engaged and productive are happier in all aspects of their life. What will you do after you retire? Make sure that you’re no

  If a bond is actually a loan, how and why do people invest in them? In this week’s show, Doug and Efraim talk about how bonds are affected by inflation and interest rates.  What are the differences between high and low interest rates, and what causes them to change? Doug explains why when the government is concerned about the economy, the Fed lowers the interest rates which affects the banks and allows them to lend more money to companies and individuals… who will hopefully spend that money and strengthen the economy. While the theory sounds good, in reality, this is exactly what increases inflation.  Keep listening to learn about what the dangers of inflation are, and what governments can actually do to negate inflation. Inflation eats away at a bond’s value, because the initial dollars you put are worth less than when the bond matures in an environment. Some folks feel that by buying TIPs (Treasury Inflation Protected bonds) they are protected from inflation. Listen to find out if this is t

For nearly two years investors faced the chaos of Coronavirus. Today, we’re facing the chaos caused by the Russian invasion of Ukraine. We can’t predict how either of these two events will end, but we do know that sometime in the future there will be more chaos wreaking havoc on the market. What should an investor do when the markets tumble? There have always been wars, plagues, and major upheavals, and yet some people have made money while investing in turbulent times. Join Doug to understand the techniques of some of the best investors who have made money by viewing their portfolio over the long-term. Should you be panicking now or looking for opportunities? If you need help with your own portfolio, and want to know how to invest in a crisis, make sure you speak to your financial advisor or get in touch with Doug and start a conversation.

What is the first thing you should do after you inherit your parents’ stock portfolio? Start with a financial planning outlook. Take a moment to think about your own needs, and determine if the inherited stocks meet those needs. If not, then decide how to sell them and what to invest in instead. The important thing is that even though at one time the assets were your parents’ stock, you don’t need to keep the assets invested in the same stocks that they did. Instead, you should create a portfolio based on your current situation, including your own tax obligations. Download the free resource “How to Make the Most Out of Your Parents’ Stocks” is an step-by-step guide for all investors looking for answers about inheritances. Download free resource: How to Make the Most Out of Your Parents’ Stocks   How are U.S. inheritances taxed? How are inheritances taxed? Are inheritances taxed differently in the United States than other countries? If you recently received a U.S. portfolio, there are certain U.S. tax laws tha

What do you need to do to have a financially successful retirement? Even if you’re lucky enough to receive a work and/or government retirement pension, chances are it won’t cover all your expenses. That is why folks increasingly depending on their investment portfolio to sustain their retirement. Have you set up your investment portfolio for success? The free resource “Do These 4 Things to Have a Financially Successful Retirement” is a must-read for anyone who wants a financially successful retirement. Read the list and begin to create the retirement you want. Download free resource: Do These 4 Things to Have a Financially Successful Retirement   Connect with a financial advisor Have unanswered financial questions? Contact The Goldstein on Gelt Show to either have a financial question answered on the show or a question answered personally by Doug. If you’re interested in more information on retiring, sign up now to receive updates on new episodes and receive Doug’s free ebook The Retirement Planning Book.