Smart Couples Finish Rich : 9 Steps to Creating a Rich Future for You and Your Partner by David Bach.
This is the second book I have read by David Bach, the first being Start Late, Finish Rich : A No-Fail Plan for Achieving Financial Freedom at Any Age. A lot of the information is the same in both books. This book has more information on record organization. One of the main concepts in Bach’s book is the Latte Factor, a term he created to describe the types of spending on non-essentials such as $5 lattes, and going out to dinner 5 nights a week, and things like that. By reining in this kind of spending, money can be saved which can be invested and can compound into huge sums of money over time. He also describes how the couple should save their money in three different baskets (Retirement, Security, and Dream). He stresses that people should make use of their 401k and IRA accounts where pre-tax money can grow tax free. He also discusses insurance. Then he gives the ten biggest financial mistakes that couples make. The final chapter he talks about how to increase your income by getting a raise. He describes the steps to go through to maximize your chances of getting a raise. This is a great book. I highly recommend David Bach’s books for people looking to improve their financial situation.
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They are showing a recorded episode of Mad Money with Jim Cramer on CNBC. I have never seen Mad Money before. I am a complete amatuer investor and I am not sure about Jim Cramer. Cramer talks a lot about trading, and from everything I have read, trading is a losing game, unless you are a brokerage firm, and making lots of commissions. Yeah, you might make money buying low, and selling a little higher, but then you have to factor in the commissions, then factor in the taxes which is at a higher rate than if you held it for a longer term. Then if you make alot of trades, you have to account for EVERY trade at the end of the year. If I buy a stock, and it grows, and it grows, I don’t have to pay any taxes on it until I sell it, and then I am paying a lower tax rate. At least Jim Cramer is talking about diversification.
Just got a call from my CPA, and found out approximatly how much I owe the IRS, and New York State in taxes. About $4225 for Federal and $544 for State. I gave him a few more numbers, such as we donated a couple cars to charity, and another business expense I found. I had put aside some money, knowing we would owe, and we will have enough. BUT, since we owe so much this year, I am going to have to send in pre-payments every quarter, so in addition to what I have to pay the IRS and NY for 2004, I am going to have to send in about a quarter of that amount for a pre-payment towards my 2005 taxes also by 4/15! Now that is going to be pain!
The IRS still owes me $1249 for a refund for my mother’s 2001 taxes (she passed away in June, 2004, and we found that she didn’t file her taxes in at least 7 years). They paid me for the 2002 & 2003 years, but said they needed a copy of the letters testamentary for the 2001 return (it was stapled to the return). I faxed it to them on 3/3, but have yet to hear back from them!
I am also waiting for payment for some of my mother’s savings bonds. Most of them were POD to me, yet the banks said they could’nt cash them. The treasury dept website says I can take them to a bank that deals with the bonds, and that they would cash them with proper id, and a death certificate. Yeah, right! No bank I took them too would cash them. One started to cash them, but them when they go on the phone to the treasury dept, the person at the treasury department said I would have to mail them in, along with notarized forms, and and a death certificate, and the letters testamentary , yadda, yadda, yadda. I got a letter today with them returning the death certificate, and the letters testamentary , yet no check, nor the non-POD bonds that were supposed to be transfered to my name. If you want to give your beneficiaries alot of grief, buy US Savings Bonds. All of this hassle for three lousy percent interest! I can put the money into some high yielding blue chip stocks, for a better return, and they are likely to go up in value at the same time!
Common Stocks and Uncommon Profits by Philip A. Fisher.
The author expounds on growth stocks. He tells his methods of finding them, evaluating them, buying them, holding them, and then selling them. He really loves growth stocks. The book is really beyond my current understanding. It is obviously intended for more advanced investors than myself. I did learn a little about growth stocks, but I am going to put this book aside, and come back to it later, and maybe I will get more out of it at that point. This book is not for the beginning investor.
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Charles Schwab’s Guide to Financial Independence by Charles Schwab.
This book is a guide to basic investing. The author describes why the reader should invest in stocks. He talks about the benefits of compounding. Also covered are mutual funds and how they work. This is an excellent book for the novice investor. He does spend a bit of time promoting the Charles Schwab 1000, but then again it is his book.
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