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Subject: persfin-digest V4 #91
Date: Sat, 11 Oct 1997 14:53:02 -0400 (EDT)
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persfin-digest Saturday, October 11 1997 Volume 04 : Number 091
IN THIS ISSUE:
ADVERTISEMENT: MCI FAX BROADCAST SERVICE
Re: Nursing Homes - Anyone Really want To Live In Them?
Can IRS Attach Retirement Funds If You Owe Them Money?
Car accident Question
Re: Subdividing - Be Careful!
income tax penalty on marriage - Consider State Taxes as Well
Re: Wade Cook Seminars? Be Careful!
RE: "Affordable" Health Insurance / Nursing Homes: Necessary Evils
Re: Roth IRA Rollover
Re: Mutual fund & diversification
"Astonia" aka Estonia
Re: IPO's
RE: Roth IRA vs. Traditional
Splitting Rollover IRA Account Advisable?
Can You Separate Deductible from Nondeductible IRA Money?
Mortgage Dilemma-HELP !!
Re: Distribution of Income
Income on Treasury STRIP
Re: Discover Card Nits To Pick
Re: Sunset For The Index Funds?
questions about life insurance beneficiary and estate tax
RE: Interested in a certified financial planner career
Re: Estate Planning Question
Sending in 2 checks
Re: Long-term care insurance
401k penalty-free withdrawals
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Date: Sat, 11 Oct 1997 14:19:17 -0400 (EDT)
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------------------------------
Date: Sat, 11 Oct 1997 14:20:45 -0400 (EDT)
From: Gregory Panayoti <greg_panayoti@il.us.swissbank.com>
Subject: Re: Nursing Homes - Anyone Really want To Live In Them?
> You may want to first see if there is any nursing home in
> which your mother is willing to live. My parents have specificly told
> me that they would rather die at home than live in a nursing home
> because the conditions in many of them are terrible. Your situation
> may be different, of course.
>
> -David Martin
>
A friend of mine used to work nights for a large pharmacuetical company
here in NJ and his job was to deliver drugs, supplies or whatever was
needed to nursing homes throughout the area. I went along to help him
once and I can tell you from experience:
You wouldn't leave your dog in 7 out of 10 of these places. I would
suggest to you, as David said to be careful and CHECK EVERYTHING OUT
COMPLETELY. I would call related agencies in your area and check on the
homes record, past complaints, violations, etc. Find out of there are
any arbritrations pending on it, find out it's financial stability (some
are selling out to Insurance companies who just want to see profits -
it's the latest trend). Stop by without an appointment and take a look
around - that's when you'll see what really goes on. If where you live
is anything like here, you'll be shocked.
There were a couple of good ones, but that's if you can afford them.
Their yearly fees can be obscene.
G. Panayoti
------------------------------
Date: Sat, 11 Oct 1997 14:21:31 -0400 (EDT)
From: Yan Zheng <yzheng@saturn.vcu.edu>
Subject: Can IRS Attach Retirement Funds If You Owe Them Money?
Can anyone tell me whether IRS has the privelige to apply the money in any
retirement fund like 401k or IRA to the debt owed to IRS? I'd like to know
how IRS handles the following siuations:
(1) have the retirement fund first, then found owing IRS lots of money, can
IRS use that money against the debt?
(2) Have owed money to IRS, but the current employer offers 401k, can we
set up the 401k without IRS taking over the money?
Thanks very much.
Yan
------------------------------
Date: Sat, 11 Oct 1997 14:22:03 -0400 (EDT)
From: a210592@brazos.fmr.com (Casey Huang OPS)
Subject: Car accident Question
Hi,
I was involved in a 3-car accident. Here is what happened:
I was driving home on 121 and all of a sudden a car hit me from behind
and I hit the car in front. Let's call the person in front Frank and
the person from behind Ben. The speed limit on 121 is 55 and I was just
following along the traffic flow at 40-45. When I got off the car, I asked
the person from behind what happened and he replied
"I didn't see you."
When the police arrived, Ben admitted that it was his fault so the police
report stated that John failed to control the speed and followed too closely.
Then Frank and I asked John for his insurace information. After we wrote down
his insurance information, he said to us "I am sorry, guys but I am glad that
nobody gets hurt." Then we said good-bye to one another. I thought the case
would be simple. But it turned out to be more complicated than I originally
thought.
I called Ben's insurance company and they recorded our conversation the next
day when they called. I thought it was over. But serveral days later, they
declined my claim on the ground that John told them I cut in front of him and
that Ben told them that he felt two impacts. I couldn't believe that they
would decline my claim so I talked to an attorney. And the attorney told me
that two impacts felt by the car in front made a big difference because, he
exlained, when Frank in front felt two impacts the normal scenario is that
I hit him first and then the car from behind hit me then I hit the car in
front again. In this scenario, I was at fault so he was feeling uncomfortable
representing me.
By the way, my car was totoled and it was 91 Honda Accord LX. I have spent
more than one thousand dollars for car rental, towing fees, storage fees etc
because of this car accident.
So now I am asking perfiners if anyone of you has similar experience and
would like to share with us as to how you get it resolved. Or I should simply
drop it. Your reply will be greatly appreciated.
- -Casey Huang
------------------------------
Date: Sat, 11 Oct 1997 14:22:58 -0400 (EDT)
From: John Wallace <JWallace@karta.com>
Subject: Re: Subdividing - Be Careful!
>Has anyone ever had any experience with real estate development he
>would care to share? Am wondering about purchasing a 15 acre farm and
>subdividing it into three 5-acre lots and wonder if anyone else has tried
>his hand at this?
SAM
If I were you, I would be VERY careful !! Small farming communities
tend to be very conservative and xenophobic. You will probably be
regarded as a ...(pick one)... Naive City Slicker / Land Speculator /
%^&$@ Real Estate Developer / Rapist of the Environment / etc.
Their attitude will be that if they let you get away with subdividing
*your* property, then the next thing to happen is that the entire
community will be overrun with Shopping Malls / Drug Pushers / Used Car
Lots / Strip Mines / Toxic Waste Landfills / Liberal Democrats / etc.
Unless you have, or can establish, a VERY good relationship with the
local elected officials, you can probably count on spending the next
several years in one mind-numbing, bureaucratic hassle after another. (
I am "sure" that the property which you are planning to subdivide is
the last remaining habitat in the entire western hemisphere for a
certain endangered species of fungus ....)
Of course you can always hire a local lawyer or builder to do everything
for you -- but that will then eat up all your profits.
------------------------------
Date: Sat, 11 Oct 1997 14:23:38 -0400 (EDT)
From: "Wiedwald, Dave" <wiedwd@WHQPOS3A.DAYTONOH.ncr.com>
Subject: income tax penalty on marriage - Consider State Taxes as Well
>>filing single, the taxes we have to pay to the IRS will be either $1,000
>>more if we file jointly or $700 more each if we file separately. Because
>Are you sure about that? Unless one spouse is entitled to
>significantly more deductions than the other spouse, MFS always
>results in taxes greater than or equal to MFJ (equality occuring when
>the spouses' taxable incomes are exactly equal).
In certain states, Ohio for example, where both spouse work and have
approximately the same income there is a significant overall tax
reduction by filing MFS rather than MFJ. This is the result of Ohio's
quirky tax laws which requires returns to be filed with the same status
as the federal return. Ohio has one set of progressive tax rates for
all filing status which significantly penalizes people who file MFJ.
The bottom line is in many cases the reduction in the state tax is more
than the increased federal tax resulting in overall tax reduction.
------------------------------
Date: Sat, 11 Oct 1997 14:26:02 -0400 (EDT)
From: Randy Barnes <rbarnes@atl.mindspring.com>
Subject: Re: Wade Cook Seminars? Be Careful!
> Does anyone have any information on Wade Cook and his Wall Street Money
> Machine seminar. It sounds very interesting, very involved, and very
> expensive.
I don't know how I missed this one on the first go-round, but let me
jump in and share my 2c. I have attended Mr. Crook's Wall St. Workshop
and would hope that you will heed my advice.
Wade cook is a former cab driver that is indeed a marketing wizard. He
has a history of bankruptcy and has never held security licenses at any
level. His company is dealing with lawsuits for various shenanigans and
at last glance was overdue for financial reporting requirements. His
Profit Financial Corp. does a song-and-dance every week at a hotel near
you. Each one will have 75 or more "suckers" (my term) shelling out big
bucks for some Wall Street Snake Oil.
First of all, the 11 profit strategies taught in this workshop are
nowhere near new. They are no secret. Anyone with much investment
experience will be familiar with the concepts. Nowhere in covering
these strategies do the facilitators discuss the obvious missing
ingredient, RISK!. The "teachers in our group were a former UPS
delivery man, and a recently retired air traffic controller ( Their
story )
I have been a fan of Mr. Cook's for about 7 years since I first heard
him promoting his real estate strategies. His marketing acumen has
fascinated me. When a friend called to say he'd enrolled in the Wall
St. Workshop to see if I wanted to attend I politely declined. Then he
called back to say that they'd allow him to bring a partner for only
$695. I still declined. The urge to peek behind the curtain finally got
to me, so I called to say "let's do it".
The seminar is very well put together. The risk in trading strategies
is hidden so well that for a day or two I was completely oblivious. I
even believed for a moment that one might actually achieve a 10% gain
month after month after month as illustrated. Well I finally came back
to earth.
Two money making strategies that Mr. Cook's clonies teach seem
particularly attractive. One is covered calls, and the other is buying
call options on splitting stocks. Covered call writing promoted as a
safe way to produce 10-20% return on your trades each month. (Not so
grasshopper.) This is because the call options on many stocks have large
volatility premiums. The reason you can easily make 10-20% a month is
simply because you can easily loose even more. Volatile stocks not only
rise but also fall. "Covering" a stock position with a call means you
are stuck with the stock until you "uncover" it by closing your
position. Many time you'll see a stock gap-down from 12 to 7 before you
knew what hit you. If you're on margin as the Cook team promotes you're
dead meat!
If you want to learn about covered calls and more the Option Industry
Council give FREE classes periodically in all the major cities. See
them for more at http://www.optionscentral.com/
Also there is a particularly good website at http://www.iistenplus
that'll offer you more than Mr. cook for exponentially less money. (
Now send you favorite charity $1,000 and you're ahead of the game ;-)
As for buying calls on splits you can indeed rake it in here. A woman I
recently met has made a bundle doing this. She made over $118,000 in
JULY. She is a receptionist and calls Charle Schwab during her breaks
and places trades. She diligently follows the split list and waits for
dips to get in. This strategy is currently a looser for her and the
others I know that are trading it. When the market is as hot as it has
been this year anyone can hit a streak of luck and make a killing.
This reminds me of the craps tables in Vegas. There's always some bozo
hitting the house for a giant stack of chips that all the sudden becomes
invincible. The next day he'll be found at the ATM getting gas money for
the trip home.
Welcome to option trading 101. If you want to trade this stuff start
with paper money and study the reality of this market. Try visiting my
favorite fool at http://optionfool.com/index.html
The bottom line is this: If you are tempted to sign up for any
investment training do it through the many places/people that actually
train you with reality-based and market-proven programs. There's really
good opportunities out there if you look for them. Spend a couple
hundred on some good books. (email me for a good "beginner" book). The
libraries don't have much on options but go there anyway. They have
hundreds of books that'll help and they're FREE! (Your taxes bought'em -
use'em!)
Wade Cook teaches a business marketing course that is probably
fabulous. That's what he's good at. I am amazed at his power of
promotion. For investment advice though, I think of Wade Cook as Ebola
for your wallet!
Randy Barnes,
Wall St. Workshop Grad, aka Sucker
------------------------------
Date: Sat, 11 Oct 1997 14:28:34 -0400 (EDT)
From: "Cal Lester C.L.U." <Cal_Lester@classic.msn.com>
Subject: RE: "Affordable" Health Insurance / Nursing Homes: Necessary Evils
>My question is indirectly related to personal finance. I desire to
>retire at the age of 50. The only thing I see that would make this
>difficult is the issue of affordable health insurance for me and my wife.
>>>> " affordable health insurance happens to be an OXYMORON ". However, I
guess you would have to define "retire". Does that mean to leave your current
field of employment, and "do something else"? Does it mean that you NEVER
expect to work another day in your life???? If the second were true, then you
would have to have a V E R Y large asset base to maintain yourself & your
wife ( and possibly some of your kid's ) for the next 30 or 40 years. That
being the case, the cost of health insurance should be inconsequential.
>Subject: Re: nursing homes - Anyone Really want To Live In Them?
-David Martin
>>>>I have been in the Life & Health Insurance industry for over 35 years. I
have heard that specific comment dozens of times. However, I can say
categorically, that it is NOT TRUE ! ! ! ! ! Life is a precious commodity.
Everybody wants to LIVE. No one wants to DIE. It is true that there are many
debilitating situations, when the desire to live diminishes, but for those who
are incapacitated, but still in control of their faculties, THEY WANT TO LIVE.
If they are NOT in control, then what happens to them is of little matter.
Nursing homes is many cases are deplorable, but still very necessary. For
those progressive thinking people who manage to purchase GOOD Long Term Care
Insurance, they get the opportunity to live out their lives in relative
comfort, due in most part to the fact that there are enough dollars to support
them properly. Those that DID NOT plan ahead, are the ones that end up in the
"OLD AGE WAREHOUSES", that I believe your parents are referring to.
I suggest that you investigate a " Comprehensive LTC policy", one that
provides dollars for care "wherever it is received", in the Home, in an
Intermediate Facility or a Nursing Home.
Cal Lester CLU
Insurance CoOrdinator
Broward Community College
------------------------------
Date: Sat, 11 Oct 1997 14:30:29 -0400 (EDT)
From: balaji@juno.com (Balaji V Ramanathan)
Subject: Re: Roth IRA Rollover
>Date: Sun, 5 Oct 1997 16:13:15 -0400 (EDT)
>From: Stephen Brodeur <sbrodeur@draper.com>
>Subject: Roth IRA tax-free forever?
>
>I tend to agree that the Roth IRA appears to still be a moving target.
>However, what makes you think that a *regular* IRA is any safer from
>future legislation than a Roth IRA? Or that home sale capital gains will
>be taxfree forever more? Or that the home mortgage interest deduction won't
>go away? Or the taxability of social security income might increase? Fact
>is,any of these things can change by legislation.
These other examples you cite are what I call the bird
in hand: you get the tax deduction in the year you invest
in them, and no congress would be audacious enough to come
back and force you to pay back-taxes on all your deductible
IRA contributions (or your home-mortgage interest deductions
etc.). On the other hand, with the Roth IRA, you get no
immediate benefit: the two birds in the bush. To take advantage
of the Roth IRA, the legislation has to stay on the books until
you retire. That is why I am a little concerned.
>Of course, there may be legal recourse, through some sort of
>'grandfathering', to escape new rules. And some things are very
>unlikely, because it will anger enough voters to throw the legislators
>out of office.
Not necessarily. For example, during FDR's rule, a
lot of "popular" laws were passed, ruining hundreds of thousands
of lives and many thousands of businesses: all in the name
of helping the poor and punishing the rich during the
depression and its aftermath.
bye/balaji/
(Editor's Question - Which laws? -IK)
------------------------------
Date: Sat, 11 Oct 1997 14:31:49 -0400 (EDT)
From: Fred Schiff <f.schiff@ieee.org>
Subject: Re: Mutual fund & diversification
>From: "L. Chen" <am302@FreeNet.Buffalo.EDU>
>A stock broker called me today and made the statement that, according to
>Financial Planners, people who invest ONLY in mutual funds are not
>diversified. I disagree with him, of course.
>But I am just curious. Have anyone else heard that statement?
oh, yeah. The other one you hear is "you can't be diversified investing
*only* in stocks" Same thing different day.
>What is the
>underlying rationale or justification for that statement?
scare tactics and the fact that he didn't take the NASD
licensing exam that allows him to sell mutual funds (SELL, remember
he's a SALESMAN). If you choose the wrong group of funds you can
get an UN-diversified portfolio. Just as if you choose a wrong group
of stocks you can end up with a real stinker of a portfolio.
>Or did that broker
>just made it up and didn't know what he was talking about?
Ask him if he knows what "diversification" means and you'll find out.
(Ask him if he knows what the Sharp ratio is.)
I now get up on my )hobby) horse.
You can diversify by investment style: growth vs. value.
You can diversify by investment vehicle: cash, stocks, bonds.
You can diversify by company size: small, medium and large cap.
You can diversify by company location: domestic vs. foreign.
You can diversify by industry (pick any ten).
You can diversify by risk/return.
etc.
The whole idea being not to "beat the S&P 500", or get the "maximum return",
but set something up which overall weathers out both good times and bad.
Can you do the above with mutual funds? yup. Can you do the above
with stocks? yup (Although its harder to invest in foreign countries,
which is where mutual funds shine.)
Ciao
Fred
Fred Schiff (f.schiff@ieee.org)
------------------------------
Date: Sat, 11 Oct 1997 14:34:00 -0400 (EDT)
From: eric <eric_marcus@compuserve.com>
Subject: "Astonia" aka Estonia
<<"I think I would like to invest in some Astonian industries"
Steps to take:1) Get the name of the country right- it's Estonia.
2) DO NOT invest directly in ANY east European country
(unless you need a tax loss)
3) Invest via a good closed-end or open end East European fund.
4) If you don't understand #3 above, DON'T invest!
5) You should have a solid, diversified investment base,
BEFORE you try to get rich in any one country's stocks.
If you want more info, e-mail me. Eric Marcus
------------------------------
Date: Sat, 11 Oct 1997 14:36:04 -0400 (EDT)
From: eric <eric_marcus@compuserve.com>
Subject: Re: IPO's
Someone recently wanted IPO information. Here's some:
Good IPO are only offered to institutional clients.
Mediocre IPOs are offered to valued (aka wealthy)
individual customers by brokers at the larger brokerage
houses.
Lousy to garbage class IPOs are solicited by phone "cold
calls" from strangers who will call you by your first
name. These IPO's are available only to members of
the "American Assoc of Suckers."
WHICH CATAGORY DO YOU FIT?
Eric Marcus
(occasional member: A.S.S.)
------------------------------
Date: Sat, 11 Oct 1997 14:37:21 -0400 (EDT)
From: ANDREA WELCH <ACE.AWELCH@MEMO.ACEHARDWARE.COM>
Subject: RE: Roth IRA vs. Traditional
In PersFin Digest #89 Rich Carreiro wrote in response to a prior
post by Stev Foulks regarding the new Roth IRA:
>>Steve Foulks:
>>Some people say that we need to consider the tax rates now
>>versus the tax rate when you retire, but I can't imagine being
>>so bold as to predict the future direction of tax rates. I
>>always assume they are the same.
>Rich Carriero:
>Well, if you make that assumption, a regular IRA and a Roth will
>have exactly the same value after all taxes are paid.
I've performed some pretty simple spreadsheet calculations with
Excel. Using the same tax rates applied to both the Traditional
and Roth IRA, they do not have "exactly the same value after all
taxes are paid". In fact, no matter what tax bracket, comparison
period, rate of return, etc. I plug in, the Roth comes out ahead
when all things are created equal.
An example follows.
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Traditional Roth IRA
Amount Invested $2,000 $2,000
Tax Bracket 28.00% 28.00%
Capital Gains Bracket 20.00% 20.00%
Comparison Period 10 10
Annual Rate of Return 10.00% 10.00%
Future Value
after 10 years $5,187.48 $5,187.48
FV after taxes $3,734.99 $5,187.48
Amount of Tax Savings $560 $0
FV of tax savings $1,452.50 $0.00
FV after taxes
of tax savings $1,162.00 $0.00
Total Return on
Investment $4,897 $5,187
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
If only all things were created equal, this would indeed be a
"no-brainer" decision in favor of the Roth IRA>
Andrea
------------------------------
Date: Sat, 11 Oct 1997 14:38:40 -0400 (EDT)
From: "David W. Vaughan" <david_vaughan@ibm.net>
Subject: Splitting Rollover IRA Account Advisable?
Hi folks!
I'm planning on moving a roll-over IRA Account with a good size balance
in it (almost all cash) I opened some time back at a bank when I left a
previous corporate job, to get access to lower brokerage rates.
My question is, are there are compelling tax, legal, accounting etc.,
pros and cons if I split the current _single_ rollover IRA account into
_two_ such new rollover IRA accounts, upon moving the existing account
to a new low cost brokerage firm? My reason for considering this is so
as to not put all my IRA investment eggs in one account with an as yet
untested broker.
Thanks in advance! /dwv
------------------------------
Date: Sat, 11 Oct 1997 14:39:21 -0400 (EDT)
From: Steve Foulks <steve_foulks@up.bresnan.net>
Subject: Can You Separate Deductible from Nondeductible IRA Money?
>From: The Editor <Ira>
>Subject: Can You Separate Deductible from Nondeductible IRA >Money?
>
> If you have both deductible and non-deductible IRA money in prior
>accounts, how do you specify which money is going to be >transferred to a
>Roth IRA?
>
>Ira
I am assuming that you would want to transfer it all into a ROTH IRA, in
which case, you would pay taxes on the whole rollover amount less the
nondeductible contributions.
If you only transfer a portion of the old IRA's then you must assume that
your rollover is "pro rata" from each of the two categories. You calculate
an "exclusion ratio" (i.e., nondeductible contributions/FMV of account) and
pay a tax on the withdrawal times (1-exclusion ratio).
------------------------------
Date: Sat, 11 Oct 1997 14:40:41 -0400 (EDT)
From: "Philip E. Clark" <engarcon@ix.netcom.com>
Subject: Mortgage Dilemma-HELP !!
I am in the process of going to contract on a great house that the seller
has been rigid in the contract wording. Anyway, the mortgage company that
will be holding my mortgage (Residential First) the mortgage agent
appeared very helpful since I was referred to her by the parent bank's
vice-president who is a good friend of mine. Three weeks have passed
since the inception of the process and I have begun to contact the
creditors that have indicated negative information on my credit report.
The creditors have been slow to respond to my letters, therefore causing
me to delay the meeting with the mortgage agent. My questions is, if I am
getting the feeling that my credit situation is causing the agent to be
less than cooperative (friendly, concerned) should I go elsewhere?. The
agent has become assertive by saying you've gotta get those
letters...What can I do to make these creditors respond?..I've written
and I've called and got no where. I am lost in this whole process and
need to deal with someone that can help me understand the requirements
and what it takes to correct them so the underwriting process goes
smoothly.
The agent was nice and not so,lately.I am applying for a FHA
mortgage and if I had the choice will pay a higher interest rate and
increase my down payment in order to push this process through. If this
agent causes a delay in the contract and/or closing I will never forgive
myself for not reacting sooner. Can anyone advise that has gone through
this stomach turning process and felt close to losing their house ?
Thanks to all
Phil
------------------------------
Date: Sat, 11 Oct 1997 14:41:10 -0400 (EDT)
From: "Robert Hartwig"<Robert_Hartwig@swissre.com>
Subject: Re: Distribution of Income
Boris,
Below you will find the US income distribution for 1994. I found this in
Table 711 of the Statistical Abstract of the United States, 1996 Edition
(the 1997 edition with 1995 data will be available later this month). The
underlying source for this data is the US Bureau of the Census, Current
Population Reports, P60-189.
Money Income of Households, 1994
Under $10,000 13.5%
10,000-14,999 9.1
15,000-24,999 16.7
25,000-34,999 14.2
35,000-49,999 16.3
50,000-74,999 16.5
75,000+ 13.7
Median Income=$32,264
A series of tables in the Statistical Abstract give additional detail
(breakdowns by race, gender, age, etc.)
------------------------------
Date: Sat, 11 Oct 1997 14:42:35 -0400 (EDT)
From: delair@pixi.com
Subject: Income on Treasury STRIP
I would like to find a computer program/excel spreadsheet that will
compute the income earned/reported each year on a treasury STRIP
held to maturity.
I wrote my own program but don't quite get the same answer
as the IRS example. Within +-.5%. Is this close enough? the total
gain is correct, only how it is distributed varies.
I have many of these bonds, and always hold them to maturity.
I print out a table at purchase to show income for every year
until maturity. Thats the only time I have to do any calculations,
Computed income may vary $5 up or down from the IRS example on a
100k face value bond. These are pretty tricky calculations and
rounding is a factor.
It just seems to me that since all the taxes eventually get paid,
and the minor error works both ways that its ok. Any opinions?
thanks you very much
Don DeLair
delair@pixi.com
------------------------------
Date: Sat, 11 Oct 1997 14:43:43 -0400 (EDT)
From: borisv@ctron.com
Subject: Re: Discover Card Nits To Pick
Dean,
>I was told that the machine that
>opens the envelopes, removes the slip and the check. If there are two
>checks in the envelope, the second will be destroyed. Cool!
It's cool indeed! But hard to believe, either.
In any case I happened to send my payment in up to 3 "parts" in the
same envelope, and never had a problem with it. Of course, it was not
Discover (but Fleet Bank Master Card), and I wonder how Discover is
using much different technology in payment processing...
Hm, it's always hard to be a guinea pig :(
I would definitely call Discover and fight the charges.
Good luck,
- -Boris
Dover,NH
------------------------------
Date: Sat, 11 Oct 1997 14:44:23 -0400 (EDT)
From: borisv@ctron.com
Subject: Re: Sunset For The Index Funds?
Jim,
>> What a relief for all of us not investing in the Index craze! :)
>Why do you call it an index craze?
Only because for too many people the reason for choosing where to
invest is only "Great last year/quoter/month return!", and it matters
little is it tulips, XYZ-tronics, nifty-fifty, or Index500...
(And, Jim, just between us, since I completely missed great S&P500
returns last 2 years, that smiley at the end was, well, self-indulgent :)
- -Boris
Dover,NH
------------------------------
Date: Sat, 11 Oct 1997 14:44:59 -0400 (EDT)
From: H Chang <hchang@ti.com>
Subject: questions about life insurance beneficiary and estate tax
Hi,
I have these questions regarding life insurance and taxes:
(1) What is the tax consequences for naming one's parents or siblings as
life insurance beneficiary?
(2) Once estate taxes are paid, does the beneficiary also need to pay
income tax on top of what he/she actually receives?
(3) Is it correct that if a life insurance is purchased by someone
other than the insured, there will be no applicable estate tax?
Can one buy the life insurance for one's spouse, or parents to avoid
future estate tax? (Assuming in a community property state such as Texas.)
Your expertise and insights will be very much appreciated.
Helen
hchang@ti.com
------------------------------
Date: Sat, 11 Oct 1997 14:46:10 -0400 (EDT)
From: Jeff Morgan <Morgajs@parsec.com>
Subject: RE: Interested in a certified financial planner career
Contact:
College For Financial Planning
(National Endowment for Financial Education)
4695 S. Monaco St.
Denver, CO 80237
(303) 220-1200
They offer a CFP curriculum via both onsite courses and self-study
by snail mail. There is also a work experience requirement, I think
it's 2 or 3 years, and it has to be in a customer service type of
capacity, i.e. 3 years analyzing data won't do it, you have to work
with people face to face.
They also offer tax preparation programs and certification, for both
individual and corporate returns.
Hope this helps.
- --
Jeff Morgan - morgajs@parsec.com
HEY! SOMEONE STOLE MY CAPS LOCK KEY!!! -- E. E. CUMMINGS
------------------------------
Date: Sat, 11 Oct 1997 14:48:01 -0400 (EDT)
From: BOB FORD <BOB_FORD@compuserve.com>
Subject: Re: Estate Planning Question
>Subject: Estate Planning for Non-citizens ?
>Also: Does anybody know of a reference source that focusses on how to
>use (or not use) Trusts to shield assets from future creditors. Most of
>the books that I have seen are primarily focussed on Tax considerations,
>and only mention judgement-proofing briefly as an afterthought ......
>Thanks !!
John
(THE USUAL WARNING)
I am not an attorney and the following is not legal advice. It is just my
opinion. It is based on my experience in California. The laws of other
states may be different.
It is very difficult to shield assets from a creditor. I have been a real
estate investor for many years and trusts are common in real estate
investing.
Trusts provide minimal protection from creditors. When an asset is owned
by a trust, a search of public records does not show that you personally
own the asset.
Documents that create trusts are private documents and are not recorded
with the county recorder. So a creditor could conclude that you do not
have any assets because a search of public records does not show you are
the asset owner.
However if the amount of the your debt is large enough for the creditor to
have an attorney, the attorney will just ask you on the witness stand if
you are the beneficiary of any trust. You either lie and commit perjury
or reveal that you are the beneficiary of a trust. If you are the
beneficiary of a trust, that in itself is an asset and can be attached by
your creditors.
In a civil case, you do not have the option of not taking the witness
stand. You must testify if you are called to do so.
I think it is impossible to be judgement proof. If you owe money, the
creditor can always get a judgement for the amount owed. About the only
thing you can do is not have any assets and never acquire any assets that
can be used to pay the judgement.
GOOD LUCK
BOB FORD
BOB_FORD@COMPUSERVE.COM
------------------------------
Date: Sat, 11 Oct 1997 14:49:36 -0400 (EDT)
From: "Rodin, Barry H." <brodin@pica.army.mil>
Subject: Sending in 2 checks
(Dean's nits to pick with Discover)
I sent in two checks totaling my balance with my last invoice.
Noticing only one check was credited, I was told that the machine that
opens the envelopes, removes the slip and the check. If there are two
checks in the envelope, the second will be destroyed. Cool!
Now I get to pay a finance charge on the outstanding balance from the
destroyed check, plus a stop payment fee on the destroyed check!
Ain't automation great!
FYI... fuming in my coffee, Dean
- ---
When I send in two checks to a company, I attach paper clips to the top
(even though they tell you not to). This will help insure that
the second one is not overlooked. Also, I will call the 800# in a few
days to be sure that my payment was properly credited.
Barry
P.S. If I had a company tell me that they destroy my checks
(as opposed to just overlooking them), I would certainly stop
doing business with that company. Besides, the Discover card
only pays 1/4% on the initial yearly charges. The Shell Mastercard
pays 2% back (up to $70 back per year); there is no Annual Fee on
the regular card (only on the Gold card).
------------------------------
Date: Sat, 11 Oct 1997 14:50:36 -0400 (EDT)
From: "Phillip Jennings" <pjennings@deans.pharm.utah.edu>
Subject: Re: Long-term care insurance
Check out this month's Consumer's Reports. The feature section is on
this very subject. As expected from CR, an informative, objective
report that also rates a bunch of different policies. "Available at
your local newstand." :-)
Phillip Jennings
------------------------------
Date: Sat, 11 Oct 1997 14:51:54 -0400 (EDT)
From: Shankarprasad.Venkoba-Rao@Eng.Sun.COM (Shankar Prasad)
Subject: 401k penalty-free withdrawals
The new Tax law offers penalty-free withdrawals from IRA accounts
for 1) first-time homebuyer expenses (upto 10K) and
2) higher education (4-year college ?) expenses for self/spouse/children
This is in addition to the "medical expenses above 7.5% AGI" exception.
I am wondering whether the same penalty-free (but taxable) withdrawals
will be permitted from 401K accounts. My employer's 401K plan permits
withdrawals for various "hardship" reasons. Home-buyer expenses, higher
education expenses, medical expenses are all part of the "hardship"
reasons - so I will be able to make the withdrawal, and will have to
pay regular federal and state taxes. The 401K plan also states that the
10% penalty might apply for withdrawals other than medical withdrawals.
Obviously, the 401K plan documents have not been updated after the new
tax law. It seems likely to me that the home-buyer/education expenses
withdrawals from 401K will also be penalty-free - but I would like to
confirm this.
California also imposes its own penalty (2.5 % ?) for early IRA/401K
withdrawals. The CA legislature passed a "Conformity" Bill which brought
CA law "uptodate" with federal law. Will the homebuyer/education/medical
withdrawals from 401K/IRA also be exempt from CA penalty ? I realize that
regular CA income tax will have to be paid.
- --
Regards
Shankar Prasad
sprasad@eng.sun.com
------------------------------
End of persfin-digest V4 #91
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