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Radio show on special needs financial planning



Media Note: On July 15, William Wood was the guest on “Your Money Matters Today” with Cornerstone Wealth Advisors. With hosts Steve Campbell and Ryan Miracle, Dr. Wood talked about mistakes that special needs parents should avoid. The podcast is to be posted here, but meanwhile here’s a link to an article that includes most of the show content: 13 Mistakes for Special  Needs Parents to Avoid.


Trump-proofing your portfolio

VoteNow that Donald Trump has been elected president, what should you do with your portfolio? There are two answers:

  1. It’s too late; and
  2. Nothing

Here’s what I mean. Asset markets move very quickly on news. Any obvious Trump-proofing measures that can be taken have been taken — in fact, that happened before mid-morning on the day after the election. Buy more defense stocks because of additional military spending? Fine, but those stocks have already fully incorporated the election. Sell technology shares because of immigration policy changes? Too late.

So that brings us to the second answer: do nothing. If you have a well-balanced portfolio, you haven’t placed a bet on any particular sector — and so it doesn’t matter which sectors gain and lose under Trump.

The best investment strategy to deal with unexpected electoral news is (wait for it) buy and hold index funds.

 

Luxury for less?

UntitledThere’s a paid ad in my Facebook feed from the New Yorker (paidpost.newyorker.com) on “How to Live Luxuriously Right Now.” Here’s a sample: The New Yorker recommends used “Vintage Timepieces” like a classic Omega 3177 watch from the 1970s for only $4,695.

Right, that’s $4,695 as in almost $5,000. Notice that for this price, you don’t get better time-keeping than with say, a $90 Casio Wave Ceptor watch (my personal favorite). The Casio syncs with the mother clock once a day. Mine has never been more than two seconds off.

So what do you get for $4,695? A piece of jewelry, mostly. I do not know how to recognize such a fine watch, but I’m sure there are people who do, and who care, and who are impressed by someone who wears such a watch.

[I would not, as we say out here far from New York, “trade you even,”  that Omega for my Casio — because then I’d have to worry about losing or damaging the thing. And nobody’s going to mug me for my Casio watch. I actually like the Casio’s dial better, too.]

If you want to spend almost $5,000 on a watch like that, fine. But don’t pretend there’s any thrift involved. And if you have friends who will be impressed by your show of wealth — uh, what kind of people are you hanging out with? [Don’t get mad; I’m just asking.]

New prepaid phone deals!

Prepaid phone plans are still the best. Even though it’s been a long time since I first posted on this, prepaid is still the way to go — and there are some new prepaid plans that are even better. Here are the top two:

Untitled

  1. Project Fi. I have been testing this plan and it’s working great for me. Under this plan, you pay $20 a month for unlimited talk and text, and then $10 per GB for the data you use. I usually use about .5 GB in a month, so my bill is $25 plus tax. Better yet, the phone is built to seek out Wi-Fi networks to get you free data when possible. When you’re out of Wi-Fi range, the phone looks for coverage from Sprint, T-Mobile and U.S. Cellular — and picks the best. Critics complain that only a few phones are Project Fi compliant — but to me it’s worth it to get one of those phones (Nexus 5X for me, a great phone for $199).
  2. Republic Wireless. A family member is testing this for me, and he reports great results. With rates similar to Project Fi, a tendency to use free Wi-Fi when it’s available, and the Sprint network otherwise, it’s a worthy competitor.
  3. Total Wireless. My Project Fi coverage is great — but, let’s face it, Verizon still has the best national network. If you want access to that network with a prepaid plan, check out Walmart’s Total Wireless. You don’t get the best selection of phones, but you do get that Verizon network and you’ll still save a lot over conventional Verizon service.

Important note: If you are taken in by a phone that’s “free” but costs you every month in higher charges, you probably won’t like a prepaid plan. In prepaid plans, you pay a real up-front price for the phone and then save every month. A “free” phone can end up being quite expensive!

I’m not sure why conventional (“postpaid”) wireless is such a bad deal. In the U.S., by historical accident, prepaid became the less prestigious option (think “burner” phones used by bad guys). But prepaid is the norm in other parts of the world and it’s the best deal in the U.S.

Pale, male and stale?

UntitledOver at investmentnews.com, a writer has discovered that investment advisers are largely white males, with little diversity. I’m not surprised — but what should a woman or person of color do in response? First, recognize that there are thousands of investment advisers out there who are totally welcoming and affirming to their diverse client base.

But beyond that, if you don’t feel respected by the investment advisers you audition, consider this: Educate yourself, and buy and hold index funds. You’ll discover that you don’t need an investment adviser at all to get a good start on building lifetime wealth. If you follow simple passive strategies, before too many years go by, you’ll have enough money that the investment advisers will treat you with great deference. (Money talks in that business.) And it’s only then that you’ll need the tax advice and compliance help that investment advisers can provide.

But as to getting stock picks that will beat the market from an investment adviser? Forget it! The “advantage” of being comfortable with a stock-picking adviser will vanish in costs that make those picks almost certainly worse than buying and holding index funds. Whether you’re white, black, red or even purple, you can leave those  “pale, male and stale” advisers with their stock picks in the dust. Trust me, the best index funds don’t know or care about your race or gender. They just keep providing superior long-term returns.