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Mastering Money

Mastering Money is hosted by Certified Income Specialist™ Steve Jurich. Steve's comments have been seen on MarketWatch, CNBC.com, Bloomberg, and TheStreet.com. Steve is joined on most days by Money Radio favorite Sinclair Noe as well as experts and authors from the world of Wall Street and real estate. New episodes published every weekday at 9am PST. Listen every weekday to get a handle on emerging market trends, asset allocation strategies, social security, medicare, RMD planning, tax strategies, estate planning, annuities, life insurance and more!
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Now displaying: November, 2015

Nov 30, 2015

In the past 12 months, companies in the Standard & Poor’s 500 have doled out nearly $1 trillion to shareholders in the form of both dividends and stock buybacks, the highest level since 2007. For years, hedge fund managers have been big proponents of share buybacks. Now, though, they are viewing them with a more critical eye, says Sarah Max writing for Barrons. Worse yet, when corporations sell their bonds, they are no longer using the money to expand or create jobs. Instead, well known companies have gone into debt with bond sales at a pace of over a trillion dollars in the first nine months of 2015. That's more corporate debt than the U.S. treasury took on to form the budget deficit.

That borrowed money got poured back into the stock market to buy back shares to try to boost their share prices. It has been working for years, but suddenly the Law of Diminishing Returns is having its say.Steve and Sinclair review a timely article by Sarah Max of Barrons on the subject. In the Q & A, Steve answers some hard questions on annuities and income planning.

Nov 25, 2015

Corporate inversions are the rage as corporations look to save billions of dollars in taxes by buying or merging with a foreign company in a lower tax environment, often Ireland. The law firms making it happen are racking up big fees. Just ask the team at Skadden, Arps, Slate, Meagher & Flom LLP working on Pfizer Inc.’s $155 billion deal with Allergan PLC. Their immediate task is getting the biggest tax-lowering merger in history past U.S. authorities.

Meanwhile, they are facing off with the Internal Revenue Service to get tax-free treatment for Yahoo Inc.’s spinoff of its $20 billion stake in Alibaba Group Holding Ltd.—an effort the agency dealt a setback in September—as well as shepherding a pair of other big transactions that would move U.S. companies overseas.

Steve and Sinclair review a Wall Street Journal report on whats behind the Pfizer-Allergan merger and why it is a slam dunk to occur. Hint: Pfizer stands to save at least $3 billion in taxes.

CFP®, CIMA® Murray Titterington joins the A Team to review and recap new social security rules and how widow and divorce benefits work in the new environment.

Nov 24, 2015

When the Federal Reserve finally decides to raise short-term interest rates from near zero, it will be Simon Potter’s job to make it happen. The 55-year-old, British-born head of markets at the Federal Reserve Bank of New York had never worked at a securities-trading firm before taking his current post three years ago, according to Katy Burne, writing for the Wall Street Journal.

The economist manages the Fed’s $4.2 trillion securities portfolio and runs a team of nearly 500 traders and analysts. Now, Mr. Potter will be faced with one of the trickiest trading assignments around: making it more expensive to borrow money when the financial system is swimming in cash. Steve and Sinclair review Potter and his approach in segment 2.

In the Q & A session, estate planning attorney Richard Dwornik joins the A-Team to discuss problems and solutions on many old A-B and A-B-C living trusts with credit shelter provisions. This is very common on trusts written between 1990 and 2009.

Nov 23, 2015

Is the saying “older but wiser” just an old wives’ tale? A study of adult intelligence, published in March in the journal Psychological Science, tested this long held idea against the data. The results challenge some common assumptions—including the idea that mental acuity, like athletic prowess, always declines with age.

The new research suggests that we do get both slower and wiser at the same time, up to a certain age. For example, testing showed that our vocabularies continue to grow, peaking as late as age 70. Twenty years ago, tests of vocabulary indicated that it crested much earlier, at age 50. Is 70 the new 50?. Steve explores in segment 4 today.

In segments 2 and 3, gold expert Nick Grovich dissects opportunity in the metals market--what to buy, what to avoid, and why.

Nov 20, 2015

According to a study of 4,500 Dutch consumers in the Journal of Economic Psychology, unhappy people save less, spend more and have a higher propensity to consume. Americans are spending just as fast as Europeans, says the University of Utah. Researchers are finding that we are all spending money--often more than what's coming in--for a new set of reasons.

Many retiring professionals continue to spend $80,000 to $120,000 annually after retirement and have no intention of slowing down or cutting back. If a couple spends $100,000 a year, they will need $3,000,000 to come from somewhere--that's without LTC or inflation.

What drives us—the majority of people in fact-- to spend too much even when we seem to make all the right moves? Steve and Sinclair review an intriguing report from the Wall Street Journal. Then, in the Q & A segment, Steve reviews his method for addressing all of a client's liabilities, and the step by step process involved in building a durable retirement income plan, while also growing capital.

Nov 19, 2015

Amid all the talk of pension plans' demise, one type of defined-benefit plan is growing fast. Cash Balance Plans are gaining popularity among business owners and medical practitioners who are behind on retirement savings. 

Kiplingers reports that many business owners are turning to these plans to turbocharge their retirement savings. Cash-balance plans have generous contribution limits that increase with age. People 60 and older can sock away well over $200,000 TO $300,000 annually in pretax contributions. In 401(k)s, total employer and employee contributions for those 50 and older are limited to only $57,500. Steve and Sinclair review the fundamentals.

 
In the Q & A Session, professional actuary and plan administrator Brad Lankford joins the A-Team to dig into Cash Balance, 401k, and Defined Benefit Plans.
Nov 18, 2015

After claiming responsibility for the Paris terrorist attacks, ISIS apparently has a new foe, according to Fortune Magazine and other outlets.

Hacker collective ANONYMOUS posted a video Saturday on YouTube in which it declared a cyber war on ISIS (Islamic State In Syria). In the nearly two-and-a-half-minute video, a person wearing the group’s signature Guy Fawkes mask read a statement in French promising that the hacktivist organization would attack ISIS in cyberspace with the ultimate goal of weakening the terrorist organization.

Reports are that 5500 twitter accounts have already been shut down, but police are saying that is not necessarily a good thing. Cyber-clues are important in tracking criminals. Steve and Sinclair review the background of the "hack-tivist" group, Anonymous.

In the Q & A Segment, CFP Murray Titterington and CPA Nick Stefaniak join the A-Team to review and recap Social Security claiming rules and tax scenarios that crop up when one spouse is working and the other is retired.

Nov 18, 2015

Obamacare is in full swing. Tax penalties are rising for not having the insurance and the cost of premiums are going up. One big problem: People are making mistakes on the Health Care Marketplace. Without a doubt, choosing a plan can be daunting. A shopper in the Affordable Care Act marketplace can choose from 40 plans on average.

Medicare is also a challenge. A typical Medicare beneficiary can choose from nearly 20 Medicare Advantage plans and 30 standalone prescription drug plans. In selecting plans, consumers are prone to mental shortcuts that often lead to poor choices. Plan labels like the gold, silver, or bronze can fool people. To some, gold sounds better than bronze even if it isn’t. Steve and Sinclair review an investigative report citing several recent studies by high level researchers.

In the Q & A segment, Steve reviews how to prioritize your retirement strategy, and why starting with cash flow liabilities (your total spending) is the most intelligent and simple place to start. Learn key questions your advisor should be reviewing with you to build your plan.

Nov 16, 2015

In the 20th Century, nearly 80% of full time employees with more than fifteen years on the job retired with a pension. Today, its closer to 20% and falling. The defined contribution 401k has taken over the defined benefit pension plan. Why? Its much cheaper for the company.

A survey released earlier this year by benefits consultant Aon Hewitt of nearly 250 employers representing 6 million employees found that, of the roughly three-quarters who still offer a defined benefit pension plan, a third were closing them and another third had frozen them.

Of the companies with plans that remained open, 14 percent of companies said they were "very likely" to close them this year, 9 percent said they were "very likely" to freeze them and 5 percent said there were very likely to terminate them. Companies terminating plans typically offer participant a lump sum payout to replace the monthly defined benefit income. Steve and Sinclair review a CNBC report. In the Q & A segment, CPA Nick Stefaniak joins the A Team to discuss year end tax planning and a special offer for Mastering Money listeners and clients of IQ Wealth.

Nov 13, 2015

Is your estate plan in order? Do you need a review or update of your living trust, power of attorney, or health care directives? Are your beneficiaries in order and would you like to better understand how a spendthrift provision in your trust could be a benefit? An AB Living Trust is a good start, but an up to date complete package is needed.

The death of comedian Robin Williams provided interesting estate planning issues that address these issues. Although he was hugely successful in movies and television, Williams spoke of financial problems in the years before his death. He had reached a net worth of over $100 million dollars in his prime, according to sources, but two divorces and fewer movie roles had reportedly depleted his assets to approximately $50 million, left completely to his kids in their teens and 20s, plus a home in Tiburon valued at $29 million, left to his wife.

Although he used a trust rather than a simple will, there still were many open ends and a lingering legal battle between his kids and his wife that he had not intended. What happened can be instructive for anyone arranging their affairs with any size estate. Steve and Sinclair review key elements and attorney opinions. In the Q & A segment, estate planning attorney Richard Dwornik and Certified Financial Planner® Murray Titterington with IQ Wealth join the A-Team to discuss special needs trusts and spendthrift trust provisions. PS: see if you can spot the flaw in segment 2 and email us!! Steve@IQWealth.com

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