16 Real People Affected By the Coronavirus Give Their Best Financial Advice

16 Real People Affected By the Coronavirus Give Their Best Financial Advice

Learn how you can get through the pandemic.  By Erica Corbin July 17, 2020

The coronavirus, also known as COVID-19, has taken over the world. As of March 30, 2020, there were more than 770,000 cases and nearly 37,000 deaths reported worldwide. It has affected the young and old alike and turned daily life in nearly every country into a surreal nightmare.

From a financial point of view alone, it’s an extremely uncertain and stressful time. Millions of people are unable to work and yet still must pay rent, car payments, student loan debt and more. Buying groceries and other essentials has become a challenge for many, too, and not just because there isn’t enough toilet paper to go around.  However, this doesn’t mean there aren’t ways of getting through this pandemic. GOBankingRates spoke with 16 people around the world who have been affected by the coronavirus, from job losses to life-threatening health concerns, and asked them for their best financial advice. Learn what you can do to manage your money during the outbreak.

1. They Nearly Got Stranded Abroad and Had To Buy an Emergency Flight Home

Nicole Diaz and her husband were in Ireland celebrating her 30th birthday when the coronavirus really started taking over. In the days leading up to their trip, more and more tours had been postponed and the country’s annual St. Patrick’s Day parade, which drew 500,000 people last year, was canceled.

They had been in the country for less than 48 hours when they learned that they needed to fly home to California immediately.  “We had to buy an emergency flight back to the U.S. once we saw that Ireland got added to the travel ban list,” Diaz said. “We ended up shelling out a little over $2,000 on the emergency flight back to Los Angeles.”  Fortunately, they were able to get home and enter self-isolation immediately.

Advice: Save 20% of Your Paycheck

“If I could give others advice, it would be to make sure you always have a cushion for emergencies like this,” Diaz said. “Thankfully, we had that cushion. I’ve been making it a habit to put at least 20% of my paycheck away toward savings and so this extra money helped us a lot.”

Diaz recognizes that this is easier said than done when you’re living paycheck to paycheck. However, there are ways to save 20% more of your paycheck without even trying.

To continue reading, please go to the original article here:

https://www.gobankingrates.com/money/financial-planning/people-affected-coronavirus-give-best-financial-advice/

Old-School Money Advice You Shouldn't Follow Anymore

Old-School Money Advice You Shouldn’t Follow Anymore

These old-school rules could hurt you financially.

By Valencia Higuera December 10, 2020

If you don’t know much about money, you don’t have to look far for advice. You can always learn from personal finance articles, books and videos or from money-savvy friends and family. Although there’s no short supply of guidance, money rules can shift over time. For that matter, some old-school advice should be taken with a grain of salt. Here’s what the experts said is some of the worst money advice.

Pay Off Your Mortgage Early

Most people need a mortgage to purchase a home. However, financing a house entails paying thousands of dollars in interest. To reduce interest charges, some borrowers come up with a plan to pay off their mortgages early by making extra payments.  This advice isn’t bad in itself, but according to Paul Moyer, the founder of SavingFreak.com, this advice doesn’t make the same financial sense in our current low-interest environment as it did when mortgage rates were higher, like 6% to 8%.

“Those extra payments can do more work for you by being placed in other investments,” Moyer said. “Even if you only get 6% over the life of the investment, you will beat the interest you are paying on your home mortgage.”

You Can Buy a House You Can’t Afford — Just Get Roommates

Taking in a roommate or two can be a financially savvy way to save money, but never purchase a home if you can’t afford to make the mortgage payments yourself. Roommates come and go, so you can’t rely on them to pay off your home loan. And defaulting on a mortgage will ruin your credit and could result in foreclosure, making it hard for you to take out loans and buy another home in the future.

Prioritize Saving For Your Child’s Education

Some parents believe it’s their responsibility to pay for their child’s college education. The problem, however, is that some people save for their child’s college education at the expense of saving for their retirement. Rather than sock all your money away for college tuition, David Walters, a certified financial planner with Palisades Hudson Financial Group, encouraged prioritizing retirement.

“I often need to remind (parents) that you can finance your child’s education with college loans and other funding sources, but you can’t finance your retirement, so a balance is needed,” said Walters. “This is even more important for parents with children at or close to college age, as their time horizon for retirement is much shorter.”

To continue reading, please go to the original article here:

https://www.gobankingrates.com/money/financial-planning/old-school-money-advice-shouldnt-follow-anymore/?utm_campaign=1043446&utm_source=yahoo.com&utm_content=1

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ello, World!

5 Money Beliefs That Are Holding You Back

 5 Money Beliefs That Are Holding You Back

John Csiszar   Mon, February 8

When it comes to financial planning, it’s easy to sabotage your own success. Between constantly rising bills and expenses and the omnipresence of the American “buy-now” culture, it can be hard to set aside money for things like emergency funds and retirement savings. Add to that the very human tendency to have self-defeating money beliefs, and it’s easy to find yourself adrift financially.

The good news is that saving and investing doesn’t have to be complicated. In fact, if you can talk yourself out of some of the most counterproductive money beliefs, you’ll find yourself on the path to success in no time. Here’s a look at some of the most common self-defeating financial beliefs and how you can overcome them for a more productive financial life.

I Don't Have Any Extra Money

This is probably the most common excuse Americans give for not saving money. And for many households, it can certainly seem as if there isn’t “extra” money for things like savings, investments or paying off debt. A simple reframing of your finances can help you get past this obstacle.

Instead of thinking of saving and investment as what you do with your “extra” money, prioritize it. As soon as you get your paycheck, slice off 5% or 10% or even 20% and send it directly to your savings. Then, use your remaining funds for your monthly obligations and discretionary spending. Some refer to this strategy as “paying yourself first,” and it’s a great way to always ensure that you do have the “extra money” you need for savings and investments.

Investing Is Only for Rich People

To continue reading, please go to the original article here:

https://finance.yahoo.com/news/5-money-beliefs-holding-back-220028147.html

The Money Date Guide: How to Talk About Money with Your Partner

The Money Date Guide: How to Talk About Money with Your Partner

February 8, 2021

Are you looking for a way to talk openly about your finances with your partner? Or do you want to start setting and sharing financial goals with your partner but don’t know where to start?

Then a money date is a great place to start. Money dates are a great way to get the awkward money conversation going between you and your partner. And they are a great way to set and share financial goals together and start feeling like a team.  Every partner has their own feelings towards money rooted in their own lived experiences. And as a couple, it can be hard to discuss these things openly, as one can feel very vulnerable.

But figuring out a way to talk about money openly is a rewarding experience that will help you get on the same page and start working on your financial goals together.*

My partner and I started having money dates when we decided to move in together. These dates have been invaluable as they help us align our money with the shared vision we have for our future.  Both of us have had an experience where we weren’t on the same page financially with our past partners, which put a strain on those relationships.  Therefore, we knew from the get-go that we needed to be vulnerable and talk about all things money, both good and bad, to be able to get on the same page and work towards our goals as a team.

And so far, it’s working for us.

In this post, I’ll give you the strategies and framework you need to start having those tough but rewarding financial conversations with your partner.

To continue reading, please go to the original article here:

https://www.cashfortacos.com/money-date/

Three Biggest Financial Fears

Three Biggest Financial Fears

by Mike Brassfield

If you’re financially stressed out these days, you’re far from alone. These are rocky and uncertain times we’re living in, and the stress level is super high. A number of recent surveys have confirmed that Americans are financially frazzled right now.

For example, a survey by the National Endowment for Financial Education found that a whopping nine in 10 Americans say the COVID-19 crisis is causing stress on their personal finances. Most worry about not having enough saved, or not being able to pay bills.  A survey by John Hancock Financial found that nearly a quarter of Americans have dipped into their emergency savings during the pandemic. 

Surveys are finding three main sources of financial stress. We’ve got strategies for tackling all three:

1. Fear of the Uncertain Future

Are you worried about losing your job? Nervous about what’s going to happen next? That’s why it’s crucial to have an emergency fund as backup — just in case.

An emergency fund is a stash of easily accessible money that equals three to six months’ worth of salary, in case you unexpectedly lose your job. And millions of us unexpectedly lost our jobs in 2020.

With the Aspiration Spend account, you can earn up to 5% cash back on your debit card purchases. With the Aspiration Save account (where you can funnel your tax refund), you can earn up to 20 times the average interest on your savings balance. (The FDIC reports that the average account earns just .05%.)

2. Fear of Falling Behind on Credit Card Debt

The pandemic and its shutdowns and its job losses have forced more Americans to fall back on their credit cards to pay their bills and pay for necessities like food. For those who are still struggling, managing credit card debt is a huge source of stress.

To continue reading, please go to the original article here:

https://www.thepennyhoarder.com/investing/financial-stress-answers/?aff_sub2=homepage

7 Key Home-Buying Numbers to Know

7 Key Home-Buying Numbers to Know
Shopping for a House? Here are 7 Key Home-Buying Numbers to Know

by Larissa Runkle  Contributor  JANUARY 25, 2021

There’s a lot that goes into buying a new home, starting with finding the right one all the way down to finalizing the paperwork. Somewhere in that process, you’ll likely find yourself trying to decipher myriad new terms and figuring out what they mean for you.

We’ve compiled this list of seven key numbers you’ll need to know when buying a home — plus the details on how understanding these terms can help you land your dream home.

Here are seven all-important home-buying numbers to know.

1. Cost per Square Foot

One of the first numbers you’ll encounter when shopping for homes is cost per square foot. While this number is based on a relatively simple calculation, it’s an important one to understand since ultimately it helps you determine how much house you’re getting for your money.

“Cost per square foot is simply the list price divided by the number of livable square feet,” said Tyler Forte, founder & CEO of Felix Homes. “This number is important because it allows a homeowner to compare the relative price of homes that are different sizes.”

But there’s more to consider, he said. “While cost per square foot is an important metric, you should also consider the layout of the home. In many cases, a home with an open floor-plan may seem larger even if it has a smaller livable square footage.”

Forte defines livable square footage as any interior space that’s heated and cooled, which is why a garage wouldn’t necessarily fit the bill. One of the best ways to understand how much home you can afford is to break it down by cost per square foot, which will vary from city to city and neighborhood to neighborhood.

To continue reading, please go to the original article here:
https://www.thepennyhoarder.com/home-buying/home-buying-numbers-to-know/?aff_sub2=homepage

The 3 Worst Ways People Will Use Their Next Stimulus Check

The 3 Worst Ways People Will Use Their Next Stimulus Check

According to Suze Orman  By  Sigrid Forberg  Sat, February 6, 202

 President Joe Biden’s plan to give Americans a third round of stimulus checks — for as much as $1,400 — is now in the hands of Congress, and House Speaker Nancy Pelosi said in a statement on Friday that final approval could come by the end of February.

That could give you a fresh payment in early March. Personal finance icon Suze Orman wants you to start thinking now about what you'd do with new COVID relief cash. She says there are right ways and wrong ways people have been using their stimulus checks.  Her general advice on the topic is to think "right now" and think long term and think of others. More specifically, Orman says avoid these three common stimulus check mistakes.

1. Not taking care of bills first

Orman tells Yahoo Finance Live that when Americans receive stimulus money, they should use it to pay bills first.

That may sound obvious, but some people don't prioritize. If money is tight or your income is uncertain, don’t focus on paying down your debts with your stimulus check, Orman says. In a recent CNBC interview, she recommended sticking with the minimum payments on credit cards, for now.

Though overall credit card debt plunged by 9% last year, according to the credit bureau Experian, many people have been relying on their plastic more heavily, just to get by. If that sounds familiar, consider rolling your balances into a more affordable debt consolidation loan at a lower interest rate.

Make sure all the big expenses that you must pay are settled: your rent or mortgage, any car payment, auto insurance and student loans.  Note that car insurance companies have been cutting their rates because people have been driving less during the pandemic. If your insurer won’t give you a break, shop around and compare rates to find a better deal.

To continue reading, please go to the original article here:

https://finance.yahoo.com/news/worst-ways-next-stimulus-check-154400568.html

What Is Money And Why Do We Need It?

What Is Money And Why Do We Need It?

Articles  Dr  Muhannad Talib Al-Hamdi *

In this article, we review a topic that was most important, but it did not receive the attention it deserves because people take it as if it were an obvious thing. We will talk about the meaning of money, its role in the economy, and what are its uses, among other topics.

Can The Economy Run Without Money?

There are historical examples of economies in which people exchanged goods and commodities in exchange for goods and other goods. In Iraq, for example, when the Bedouins came to the cities, they would exchange their products of carpets, wool and other products in exchange for urban products such as tobacco, sugar, rice and others. But modern economies use cash to carry out trade. Money is defined as any asset that people own and accept by others in exchange for the goods and commodities that they sell or use for financial exchanges. An asset here is everything of value owned by a person or company.

Barter System And The Invention Of Money:

For a better understanding of the importance of money, let us look at the case of an economy that does not use money. The economies in which goods and commodities are exchanged for goods and other commodities are called barter economies. These economies have major fundamental shortcomings. The exchange of goods and commodities in these economies needs to have a bilateral reciprocal desire.

That is, meaning that you need what the other person has, and at the same time the other person needs what you have. It may take a long time and a lot of effort on the part of people for this mutual desire to materialize. This renders the barter system an inefficient system and limits commercial exchanges and thus reduces the size of the economy significantly. Therefore, it is not surprising that the peoples who use this system live in a deplorable economic situation.

In order to get rid of the problems associated with the barter system, societies have incentives to create a commodity that most people will accept in exchange for the goods and goods they exchange. For example, Iraqis used gold and silver as a means of exchanging goods and commodities before the concept of modern money developed. Historically, when a certain commodity began to be widely accepted as money, people would start accepting it even if they had no other use for it.

Selling and buying goods and commodities becomes much easier when the cash is available. People just need to sell what they have for cash and use that cash to buy what they want. When cash is available, families are more likely to specialize in producing specific things rather than producing everything they need.

In modern economies people are highly specialized. They only produce one thing, such as being a doctor, teacher, or accountant, and they use the money they get from their work to buy everything they need. People become more efficient in production when they specialize because they will gain comparative advantage in production.

The high incomes that people achieve in modern economies derive from the specialization in production made possible by the presence of money. Therefore, the answer to the question of why we need money, is that it makes commercial exchange easy and gives people an opportunity to specialize and become more productive and achieve higher incomes.

Functions Of Money:

Anything that is used as money, for example gold, salt in North Africa, cigarettes in prisons, dinars or dollars must perform four functions:

Exchange Broker:

Money serves the function of a medium of exchange when the sellers are ready to accept it in exchange for the goods and commodities they sell. When a food store accepts a banknote in exchange for some bread and milk, that paper acts as an exchange. Through the medium of exchange, people can sell goods and goods for cash and use the cash to buy what they want. An economy becomes more efficient when people accept a single commodity as a medium of exchange for goods and commodities.

Measuring Unit:

In a barter system, each commodity has a very large number of prices. Maybe the price of a cow is fifty chickens, or 200 eggs, or 2 tons of wheat or other things. When one commodity is used as money, each commodity will have one price instead of multiple prices. This function of money gives buyers and sellers a unit of measure, that is, a means of measuring the value of a good in the economy using money. And because the Iraqi economy uses dinars as money, all goods and commodities have a fixed price in dinars.

Stock Value:

Money allows people to store the value of their money with the money itself. That is, if you did not spend all of your money to buy goods and commodities, you could keep part of the money with you for future use. It is not just money that can be a store of value. Any asset of value, such as a plot of land, a painting, or a piece of carpet, for example can be a store of value.

Financial assets, such as stocks and bonds, have an important benefit compared to keeping cash as store value because they yield higher interest or may increase in value in the future. You also have other assets over money for this job because it provides some services: for example, your house provides you with housing service.

So why do people keep some cash with them? The answer is simply liquidity, that is, the ease of transferring assets to an exchange broker. Because money acts as a direct medium of exchange, it is the most liquid asset. If you want to buy something and need to sell an asset you own in order to do so, it is very likely that it will cost you some costs.

For example, if you want to buy a house and you want to sell gold items owned by the family, you may have to sell them at a lower price now. To avoid such costs, people are prepared to keep a portion of their wealth in the form of cash. There are at least two problems with using cash as a store of value. The first is that money loses some of its value over time due to inflation. Second, there is a physical risk like fire, theft, or maybe mice.

Deferred Payment Standard:

Money is useful because it provides a standard for deferred payments in borrowing and lending matters. It can facilitate exchanges at a given moment in time by providing exchange broker function and unit of measure. But it can also facilitate exchanges over time by providing a valuable stockpile function and standard deferred payments. For example, you could buy a car today and pay in deferred installments over a period of time with cash.

How important is it for cash to act as a store of value and a reliable deferred payment standard?

People care about what their dinars can buy in terms of food, clothing, commodities, and other goods. In other words, the value of money depends on its purchasing power, that is, its ability to purchase goods and commodities. Inflation causes a decrease in the purchasing power of money because higher prices make the same amount of money able to buy fewer goods and commodities. When inflation reaches very high levels, the money becomes a store of value and an unreliable deferred payment standard.

What can be used as money?

When something can be used as a medium of exchange that makes commercial exchanges easier, the economy can operate more efficiently. So the question is, what are the assets that can be used as a medium of exchange? And as we indicated earlier that for anything to be used as money it must be, at least, generally accepted as a method of financial payments. But in practice there are other requirements.

There are five criteria for any asset to be used as a broker:

The original has to be accepted by the majority of people.

It should be of modular quality, that is, every two units of it are identical. Hence, the use of precious metals as money becomes a difficult process due to concerns about the different purity of different metal pieces.

It should continue to exist for a long time so that it does not lose its value as a result of continuous use.

It should be of comparable value to its weight so that large quantities of it can be transported easily in order to be useful for commercial use.

It should be divisible so that people can use it to buy goods and commodities of less than its value and receive the remainder at a value less than the asset itself. (Unless you're a cowboy hero like John Wayne or Clint Eastwood who walk into the bar and shoot, drink, eat, pay and don't take the rest.)

The Iraqi Dinar has these characteristics. What makes the Iraqi dinar acceptable as a medium of exchange? Simply, it stems from personal expectations. You regard an asset as money if you believe that others will accept it in exchange for goods and commodities they give you. Society's acceptance of the use of dinars as money is what makes it acceptable as a medium of exchange.

From here emerges the need to differentiate between the different types of money. We focus here on two types of money.

Commodity money:

They are assets that have intrinsic value separate from their use as money. For example, gold has value in the manufacture of jewelry, dental fillings, and most importantly in the manufacture of microelectronics. But using gold as money is a big problem. The money supply will face great difficulties for the government to control because it depends on the quantities of gold present or that are being discovered.

Paper money (including coins):

The economy would be inefficient if it relied on gold as money. Transporting quantities of gold for use as a medium of exchange for commercial transactions would be difficult, dangerous and costly. In order to avoid this, people in Britain began and by the year 1500 to store gold with goldsmiths and goldsmiths began to issue papers proving the holder's ownership of a certain amount of gold.

People took to exchange these papers to meet their needs from purchases. Governments and companies in Europe took notice and began issuing documents that could be bought back for gold. As long as people had confidence that the gold backing up those securities was there and available when they asked for it, those documents remained in circulation as an exchange medium. As a matter of fact, paper money was invented.

In modern economies, paper money is issued by the central bank of the state which is one of the state institutions responsible for regulating money supply. The Central Bank of Iraq was established in 1947 by royal will and was previously called the National Bank of Iraq until 1956. At present, there is no country in the world that issues paper money covered with a gold cap. Paper money has no value except that it is used as money and therefore it is not commodity money. Paper money is a currency issued by the monetary authority with a decision to consider paper as a currency only.

If you look at the Iraqi dinar, you will see some words that say "a banknote issued by law," meaning that the Central Bank officially issued the note to be used as money. The Central Bank of Iraq is not required to exchange the dinar for gold if the holder of the dinars so desires. The banknotes issued by the central bank are a legal document in Iraq, meaning that the Iraqi government imposes its acceptance by people and companies in their dealings and the payment of government fees.

Although it is a legal document, it will not be of much use to use as a medium of exchange and it will not work as money if people stop accepting it in general. The key to accepting cash is that families and companies have confidence that if they accept these papers in exchange for the goods and services they sell, they will not lose their value while they hold it before using it again. Without this trust, the banknotes will not function as an exchange.

* Professor of Economics and Political Science, Kansas State University, USA.

Number of observations 107 Date added 01/19/2021    https://economy-news.net/content.php?id=23698

Strategic Ways to Distribute Your Required Minimum Distribution

Strategic Ways to Distribute Your Required Minimum Distribution

There are several ways to better preserve your account balance

By DENISE APPLEBY   Updated Jan 24, 2021

As life expectancy increases, more people want to defer making withdrawals from their retirement accounts for as long as possible to ensure that their nest eggs will meet their retirement income needs. However, withdrawals must begin by a certain age to avoid penalties.

If you are at least age 72 as of 2020, you need to withdraw required minimum distribution (RMD) amounts from your traditional, SEP, and SIMPLE individual retirement accounts (IRAs). Depending on the provisions of the plan, you may also need to withdraw from your qualified, 403(b), or 457(b) plans.1

KEY TAKEAWAYS

Some distribution strategies—such as equalizing balances for your beneficiaries and rolling over excess amounts—may help you maximize your returns and minimize your tax burden.

The new age as of 2020 for taking required minimum distributions (RMDs) from your traditional, SEP, or SIMPLE IRAs is 72.1

The $2 trillion coronavirus emergency stimulus package suspended RMDs from retirement accounts for 2020.2

RMDs Suspended Due to COVID-19

On March 27, 2020, President Trump signed a $2 trillion coronavirus emergency stimulus package called the CARES (Coronavirus Aid, Relief, and Economic Security) Act. It suspended RMDs for people ages 72 and older for 2020, allowing retirement accounts more time to recover from the year's stock market downturn.2

In normal years, you can apply certain strategies to your retirement account withdrawals that will help you to preserve your account balance. Here we highlight some of these considerations.

Strategic Ways to Distribute From Designated IRAs

If you own multiple traditional, SEP, and SIMPLE IRAs, you must calculate the RMD amounts separately, but you can aggregate and distribute the total from one or more of those IRAs.1 When determining the IRA from which you’ll distribute your RMD for the year, you may want to consider the following strategies.

Equalizing balances for your beneficiaries

To continue reading, please go to the original article here:
https://www.investopedia.com/articles/retirement/05/strategicrmds.asp?utm_campaign=quote-yahoo&utm_source=yahoo&utm_medium=referral

"A Word To The Wise About Trusts and Foundations" by Buelingo at TNT

TNT:

Buelingo:  A WORD TO THE WISE ABOUT TRUSTS AND FOUNDATIONS/ MY OPINION

Disclaimer: I am not an attorney or anyone who is anything more than just learning myself, however I feel the need to try help others who have made comments about Trusts especially on the calls and who seem to know as little about trusts as I did when I first came on to TNT calls.

The first time I heard “TRUSTS” mentioned as the place to hold our RV money after exchange for its protection I said NO WAY I will not ever have a trust.

My reason for that feeling was I had spent nearly 40 years fighting a trust and was taught carefully that it was the one and only thing to do by our law firm and yet it was a total disaster. I had wrongly been given the understanding a trust was a trust, was a trust and that was it.

When my Father was told he had stage 4 cancer and had only a few months to live, he asked around for what to do to take care of Mother, me, and my stepbrothers. I was just out of high school and starting college. Dad was referred to an older Attorney who was “the best around” and was told to set up a trust and it would take care of Mother as long as she lived which everyone thought would not be too long as she was in poor health herself from worry and care of Dad for years of his health problems.

To everyone’s surprise Mother lived over 34 years to over a 100. The trust became a nightmare for us. The attorney had written the trust but did not want any of us to see it at first. He had asked Dad for an okay and Dad was in no condition to question, so put the local bank as trustee.

We noticed the balance of cash assets seemed to go down a little each year and when we ask for cash for Mother’s special needs, we were pushed off with “you will need to wait until the investments mature or you will lose a lot in penalties” and other excuses. They were charging more fees than the income from the investments.

 When we approached the attorneys, over the years we were told, it was all set by law, and they could not change anything, and we had to live with the way it was. Just work with the bank. We went through 3 generations of the attorney’s family in the near 40 years before the trust was closed.

 In the end all the family of attorneys died, and their Practice was sold to other attorneys who then figured out why we were always put off and lost most of all the money in the trust. The original attorney firm was also the attorneys for the bank, its biggest client, so they did not want to ruffle any feathers or get caught in a conflict suit, so they hid it all from us.

I had a very bad taste in my mouth about trusts as I had no idea until Ray explained there are many variations of trusts and we needed a NON-STATUTORY, IRREVOCABLE, COMPLEX TRUST. I now understand that what Ray teaches and advises us to do is 180 degrees opposite of what I had dealt with.

I offer this little “parable” so those who do not understand even the most basic things about trusts like I was to start, might get a little better feel for what Ray is talking about and why I now understand at least the difference in what Ray is telling us. I hope others can avoid a bad Trust.

Ray teaches us about and that as he has repeated many times on each call, “Don’t rush to get a trust, wait and learn what is best.” Waiting and learning may save you or your family years of frustration and regrets like my family experienced.

Everyone should understand a “CAR” so here is my example. When someone says you need a new car there are a lot of questions come to mind, which make, model, color etc. So, it is with Trusts there are many types but only one combination that out does all others for what Ray has been teaching us. It must be a trust that contains ALL 3 features, not just part of them. I have learned there are many trust providers out there that say they will provide what you want but actually only truly provide 1 or 2 of the features Ray recommends. Remember NON-STATUTORY, IRREVOCABLE, COMPLEX

STATUTORY OR NON-STATUTORY

A statutory Trust is like having a Railroad car. It is on a set of tracks as laid out by government and it is controlled by what laws they want for you, and you go where they want you to go or live by their ways. You have little control over your trust.

NON-STATUTORY (what Ray recommends) is controlled by the Trustee(s) which if done the way, Ray teaches, it will be you or your family. You are like being on the open road and can design your trust so you can make adjustments as needed to keep your trust current with the needs of the trust and yourself or in other words dodge chuckholes and go the direction you feel is best. This is what he means when he says “Control not ownership”

REVOCABLE OR IRREVOCABALE

Revocable will protect your assets against probate if you die but not much else.

IRREVOCABLE is like having full coverage car insurance. It not only protects from probate but also protects the assets of the trust from suits, personal debt and other things that can happen to you or your family outside the trust. “You don’t own its assets, so they are secure and protected if someone tries to take what you have. Again “Control not ownership” is shown.

SIMPLE OR COMPLEX

A simple trust is again controlled by others, or whoever wrote your Trust. It is like a car without a steering wheel. It is remote controlled and so you go where others directed your course at the time it was written. For example, if you chose the beneficiary of the trust to be a certain entity and they no longer exist you have an expensive process to redo things to make the needed changes.

With a COMPLEX trust the Trustee(s) can adjust as needed as time goes on what will better serve the trust’s purpose or needs. You have a steering wheel and can use it to keep the trust doing the best it was intended to do.

In Conclusion on Trusts. I do not want to sound critical, but Don’t fall for the all the same Natural trusts, Pure Trusts or several other names including the Delaware, Wyoming, Nevada and others that claim to be non-statuary, irrevocable, complex. Some are actually Statutory trusts. They are not as they profess as shown by the fact, they mostly tell you they can produce your trust in only a day or two or week. They do not have all 3 features, usually missing the complex feature, as proven by the time they are one size fits all, cookie cutter produced.

My research has given me to understand it will take 2-6 weeks of going back and forth with the writer of a trust to really do a complex trust with all the features and specific details you should include for your protection and adaptability. Make sure your trust includes all you will ever need for flexibility and 100% to your specific wants and needs.

FOUNDATION COMMENT

One more thing that has come to my attention which may be something you will want to investigate is 501-c-3 Foundations.

Recently I came to understand Charitable Foundation are not just 2 types, Operating and NON-operating. There are sub-categories of 501-c-3s. There are numerous sub types some for Religion, as well as many other categories, so one should make sure who you have help setting up your Foundation, so it does not run into problems later filing required annual reports.

My Daughter in law told me to watch for this as she is a CPA who is also a full time IRS Tax auditor working only with 501-c-3s. She says often new foundations are put in the wrong code so must have corrections made to keep their status. Especially do it yourself Foundation writers make these mistakes. Just a word to the wise.

(Dinar Recaps Note: This post is for informational purposes only.  It is not legal, tax or investment advice.  Dinar Recaps advises that everyone should do their own due diligence and seek local Professional tax, legal and/or investment advisers.)

A Conversation About Perceived Value

A Conversation About Perceived Value

A customer asked a contractor friend of mine how much it would cost to do this project.

My friend gave him a proposal: $4500

The customer responded: That’s seems really high.

My friend asked: What do you think is a reasonable price for this job?

The customer answered: $2500 maximum

My friend responded: Ok, then I invite you to do it yourself.

The customer answered: I don't know how to.

My friend responded: Alright, then how about for $2500 I'll teach you how to. So besides saving you $2000, you'll learn valuable skills that will benefit you in the future.

The customer answered: Sounds good! Let’s do it!

My friend responded: Great! To get started, you are going to need some tools. You will need a chop saw, table saw, cordless drill, bit set, router, skill saw, jig saw, tool belt, hammer, etc..

The customer answered: But I don't have any of those tools and I can't justify buying all of these for one job.

My friend responded: Ok. Well then for an additional $300 I can rent my tools to you to use for this project.

The customer answered: Okay. That’s fair.

My friend responded: Great! We will start the project on Monday.

The customer answered: I work Monday through Friday. I’m only available on the weekends.

My friend responded: If you want to learn from me then you will need to work when I work. This project will take 3 days so you will need to take 3 days off work.

The customer answered: That means I’m going to have to sacrifice my pay for 3 days or use my vacation time!

My friend responded: That’s true. Remember, when you do a job yourself you need to account for unproductive factors.

The customer answered: What do you mean by that?

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