August 18, 2016, 8:27 pm

3 Reasons to Start an IRA With Betterment

by: The Financial Blogger    Category: Investing Ideas



Betterment is a novel new investment platform that takes the guesswork out of investing. They’re not the new kids on the block anymore, having been around since 2008, but they’re still new to a lot of investors. If you’re hoping to learn more about Betterment, here are three reasons that you might want to consider the service. Betterment offers a whole lot of value to users, especially users who are new to investment. We’ll examine some of their most important value propositions below.


  • Betterment’s Automated Diversification. Diversification is central to the strategy of any good investor. It essentially prevents investors from putting all of their eggs in one basket. When a single stock or an entire sector goes south, being invested in entire markets makes these losses a lot easier to compensate for. Betterment achieves automatic portfolio diversification through their new robo-advising methods. They put investors’ portfolio contributions into several pre-chosen ETFs. These ETFs represent index funds from US markets, international markets, developing markets, and more. The user also has a choice of how much of their portfolio to place in stable bonds, which are also automatically diversified.


  • Betterment’s Great Prices. Betterment charges their active customers only 0.35%, at most. People who deposit larger balances could pay only 0.25% of even 0.15% annually. That’s much less money than one would ever pay for a traditional investment advisor. Betterment is also likely to outperform these traditional advisors, many of whom don’t even beat the index every year. For such high prices, one would expect traditional managers to make the investor a lot more money, but they generally don’t. Betterment’s model is often described as “set it and forget it”, and there’s good reason why. By starting a simply account and making regular contributions, a user can set the stage for reliable returns in the long run, with little money paid and little daily oversight required.


  • Betterment Makes it Easy to Follow Goals. Lots of Betterment users use the service to prepare for distant retirement. Betterment makes this easy by showing you just how much money you can expect to make in the time between now and your planned retirement date. You’ll see how your funds can be expected to grow in strong investing climates, as well as weak ones. You’ll see how much you need to contribute to comfortably achieve your goals. The platform brings a lot of great visualization tools to the party, one of the most difficult aspects of understanding our portfolios.


Betterment offers a lot more value to users, especially people who have never invested before. They make it easy to roll over accounts like IRAs, they offer free tax-loss harvesting, and they even offer free service for new users. Their algorithms are powerful, giving reliable returns to users based on insights gleaned from millions of data points, not the hunches of a few experts. The market is too diverse and wild for anyone to legitimately claim expertise over it. Instead, the automated diversification methods built standard into Betterment are enough to do better than investors of yesterday.



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August 12, 2016, 12:37 pm

The world’s most influential lawyers/attorneys and how they got there

by: The Financial Blogger    Category: Business


Broadly speaking, people from legal backgrounds hold some of the most powerful positions in the world – from presidents to highly respected journalists and executive directors, there seems to be something about those who have previously studied to be a lawyer or attorney that drives them to rise to the top.

Without further ado, let’s take a look at the most influential lawyers and attorneys in the world today, and how they achieved their goals.

Samantha Power

With a distinguished career as a journalist, advocate, lawyer and UN ambassador, Samantha Power has it all. Samantha worked her way through the prestigious Harvard Law school to get to where she is today.

Elizabeth Warren

This Harvard Law professor comes from humble beginnings. Elizabeth Warren is of Native American origin and specialises in commercial law. Despite ruling herself out of the running for the Democratic Party leadership to leave room for Hilary Clinton, she is hotly tipped to enter the political arena in the future.

Bryan Stevenson

Another lawyer with multiple strings to his bow, when not dispensing legal advice Bryan Stevenson can be found working as director of the Equal Justice Initiative, as well as working as an NYU law professor. He is well known for his liberal stance that “forgiveness is a necessary means” of achieving equality.

Vladimir Putin

Believe it or not, Vladimir Putin received his degree in International Law as a student at Leningrad State University (now St. Petersburg State University), which is the oldest law school in Russia. It’s no surprise to learn that Putin’s experiences of university inform his pulls-no-punches leadership style, particularly when it comes to foreign policy.

Barack Obama

As his second and final term as President of the United States comes to an end, it’s easy to forget that Obama worked his way through Harvard Law School as a youngster. Barack must be a quick learner, as he believes law school should take no longer than two years.

Marine Le Pen

Le Pen is a right-wing politician who heads the National Front, the third-largest French political party. Prior to becoming a political figure, Le Pen gained a Master of Laws from Pantheon-Assas University in 1991, followed by a Master of Advanced Studies in criminal law a year later. Le Pen began practising law after this as a lawyer representing illegal immigrants who could not afford a lawyer – ironic, given her political stance on the current refugee crisis.

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August 4, 2016, 12:04 am

A Banker’s perspective on your loan application

by: The Financial Blogger    Category: Banks and You

I’m sure you already heard that from a friend or from a family member: “the bank declined my loan, they don’t know what their doing!”. Banks and other financial institutions are often seen as the bad guy who doesn’t understand. This situation often occurs because most people don’t know how loans workout. I have a Norwegian friend who works in a bank and told me how it works. Here are they look at Norwegian consumer loan application:

#1 Who are you?

The first question is related to the person who applies for a loan. The banker wants to know where you work, for how long, if you are married, have children, etc. This helps him drafting a portrait of the kind of person you are. The point is to know if you are in a situation that you will need more credit later on or if you are relatively stable. Loan officers love when someone is stable, it makes credit behaviours predictable.

#2 What have you done so far?

Then, the banker will look at your balance sheet. If you have been working for the past 20 years, he will expect to see some assets. If you ask for more credit and you show a negative balance sheet (more liabilities than assets), your chances of getting the loan are not very good. Usually, cars, furnitures and jewels are not accepted as asset in the eye of a financial institution. They will most likely look at your bank account, investments and real estate properties.

The financial institution will also pull out a credit bureau to see which kind of payer you are. A bad credit is a direct breach of confidence in your relation with the bank.

#3 How will you pay your loan?

Finally, the banker wants to know who you will pay off your debt. This is often a misconception from the population who has assets, but little revenue. If your house is free of debt but you don’t work anymore, it will be harder to convince the lending firm to give you a new mortgage. In the end, the banker doesn’t want to take back your house. He is not in the housing business, he is in the lending business. He wants to make sure you have an income stream that is sufficient to pay for your living and reimburse your debts.

A quick tip to get approved

My friend finished his explanation with a great tip to put all your chances on your side to get approved for you loan: tell the truth! A good explanation of the worst situation is better than a good lie. Most bankers will read you and find out about your lie instantly. Then again, lying to a financial institution will definitely not get your loan approved!

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July 13, 2016, 5:07 pm

How You, Too, Can Capitalize Off Of Brexit

by: The Financial Blogger    Category: Investing Ideas

How You, Too, Can Capitalize Off Of Brexit

Despite the fact that some time before the British referendum to leave the European Union, four out of five European hedge funds had bravely put their money on the UK remaining in the EU, a certain number of firms saw some pretty impressive returns after their betting against the grain of popular opinion of economic policy and the cash debate. According to Craig Weynand, the NuWave Matrix fund rose in profits by 12% on the day of the vote. Other hedge fund managers, like CIO Ryan Tolkin of Schonfeld Strategic Advisors among others, as well as legendary investors George Soros and Stanley Druckenmiller also made fantastic gains from the sudden market volatility. How did these people achieve such successful gains even if, in the case of the hedge fund managers, they did not place bets on the outcome? The answer is simpler than you might think…

Understand The Risk


China is being crushed by their debt and poor economic policy, as is most of Asia. The Brexit decision is a testimony to the success (read: absolute failure) of the EU’s experiment in artificial currency, the Euro, which has been a central point in the cash debate. The whole world will feel the consequences of Brexit, consequences that will change depend on how prepared economically those countries are.


As an individual, you might be wondering what you can do to prepare for a volatile and risky market. A great place to start is to look to the greats; for instance, the aforementioned Soros and Druckenmiller. What did these incredibly wealthy and influential men do long before the Brexit decision was even brought to referendum?


Well, Druckenmiller just told the attendees of the Sohn Investment Conference in May to get out of stocks and get into buying gold. George Soros dialed back his US holdings and invested in the SPDR Trust. Really, investing in gold may be the best move in the wake of the British referendum. Every group or individual who made returns of any major kind after what Remain-ers claimed would be the fallout after the vote on the 24th of May has one thing in common: they all invested in, or already owned, precious metals.


A Safe Bet


Peter Donisanu compared the economic results of the referendum to Black Wednesday. Part of his comparison is correct: People have flocked to “safe haven” assets, such as government bonds, but even the prices of the precious metal have been predicted to begin to fall starting in August. A different safe option would be the cryptocurrency Bitcoin, which has many of the trademark qualities of a safe-haven investment.


Diversify, Diversify, Diversify


As in any great shift in economy, the safest move after the UK’s departure of the European Union is, as usual, to diversify your portfolio with a variety of safe investments. There has never been a better time to get a few more eggs in your basket, and your financial health will certainly be better for it.

By Harald Seiz, Multi-Business Entrepreneur & Expert on Gold


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July 6, 2016, 1:02 pm

5 First Steps to Building a Successful Budget

by: The Financial Blogger    Category: Personal Finance


Formal budgeting is often seen as a cumbersome exercise, yielding more tedium than tangible financial gains. Record keeping aside, the process does furnish valuable insight for those committed to tracking expenses and accounting for household cost of living. The key to maximizing the positive impact of formal budgeting is applying discipline and using the data to take control of your financial life.

In its simplest form, a budget is balance sheet, accounting for income and expenses. And while there are many ways to manage household finances, budgets formalize the process, putting your bad spending habits under a spotlight. Identifying where your money goes enables you to divert resources to more important areas, as you realign spending priorities. Especially when financial difficulties cause cash flow problems, budgeting helps ensure your income stretches to cover all of your expenses.

If you’ve had limited success with prior attempts, or are creating your first formal budget, stick to these basic budgeting tactics.

Categorize – Your household financial flow operates like a small economy, addressing spending in several distinct areas. In order to create a realistic record of your spending, break it into smaller pieces, to track as related purchases. Your “Entertainment” category, for instance, includes spending on movies, concerts and music downloads, as well as cable TV subscriptions and nights out with friends. Another classification, called “Food and Dining”, captures spending at the grocery store and money paid for prepared meals. If your gastronomic explorations are more like entertainment than sustenance, you may choose to file restaurant costs in that category. The key is remaining consistent, so categories reflect the same type of spending each month. Additional categories to consider as you track spending:

  • Travel/Transportation
  • Automotive
  • Household/Utilities
  • Clothing
  • School
  • Medical Costs
  • Your Own Unique Classifications…

Track Spending and Income – Effective budgeting balances income with outgoing spending. In order to build a meaningful budget foundation, it is important to closely track spending for an extended period of time. For the best results, note purchases in a ledger each month, for at least three consecutive billing cycles. Once each month is complete, budget columns can be reconciled, so you know exactly how much money was spent in each category. Over time, subsequent months can be used to identify and compare spending trends.

Accounting for income is fairly straightforward when it comes from a single source, but you should also include money made on the side. Investment returns, hobby businesses, and even gambling winnings should all be included in your plus column, before you begin to tally expenses.

Set Spending Limits – Once you’ve accumulated personal financial data, it is up to you to put it to good use. Using your established categories, turn your eye toward budget savings, setting spending limits in each category. Discretionary purchases yield the most potential for trimming, because ‘fixed’ monthly expenses do not change substantially from month to month. Be realistic, but also challenge yourself with budget limits forcing you to spend sensibly.

Make Adjustments – Even with several months’ worth of spending records at your disposal, it can be difficult to craft a manageable budget. Start with core costs, addressing big-ticket obligations like mortgage repayment, car notes and other fixed monthly costs. As you rein-in your discretionary budget, leave room for adjustments. A cancelled subscription, for example, can always be reinstated, should your budget yield resources to cover the cost. Likewise, ineffective budgets can be tightened further, when cost-cutting measures don’t add-up to sufficient savings.

Show Resolve – Budgeting is a directed effort, so commitment and resolve are key ingredients for success. If budgeting is uncomfortable, you are probably doing your job, leaving no spending unexamined. To assist those put-off by the process itself, budgeting apps and software simplify record keeping and furnish intuitive tools for managing cash flow. Use these and other resources to remain steadfast throughout the initial formal budgeting process. Once established, your budget becomes increasingly easy to maintain, as good habits replace poor spending outcomes.

Without an accurate understanding of where your income is spent, it is difficult to take control of your personal finances. Formal budgeting highlights cash flow trends, illustrating where your money goes. Armed with a ledger tracking expenses and a commitment to maximize resources, it is possible to carve out savings and stretch your financial reserves. Use these 5 steps to jump-start your personal budgeting resolve.

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