Jill on Money: Sandy, investing, market timing
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As everyone recovers from Sandy, there were some valuable lessons about insurance that even those not affected by the storm should learn. To help victims of Sandy, you can donate to the American Red Cross.
Rich from Buffalo has $150,000 which could be used to pay down his 2.875% mortgage or to invest in a non-retirement account.
Jim from Woodstock, NY has an old variable annuity (VA) in non-qualified account, which has $121,000 in gains. This brings up one of the many problems of VAs: they convert capital gains into ordinary income! We also discussed how Jim should be managing his "fun money" account.
Beth from MI is recently divorced and is wondering whether to use index funds or a target date fund for the proceeds from a retirement account.
Jeannie NY is wondering about choosing a financial planner. Although her friend recommended someone, how should she "check her out"? A few resources for those in a similar situation: FINRA.ORG, CFP.net and when you meet the potential advisor, don't this to bring this handy-dandy post: "How to choose a financial advisor: 10 questions"
Ruben from CA may be the youngest caller ever on the show. At age 22, he's juggling repaying his student loans with a desire to move out of his parents' house.
David wrote in to ask about how to save in a tax-efficient way after he has maxed out his employer-based plan, and Bev raised an interesting tactic: contributing to a non-deductible IRA and later converting it into a Roth IRA.
Jennifer from VA and her husband own a home and a rental property. They want to move to better school district and need a strategy for accumulating a down payment versus paying down their existing mortgage.
John is worried about the market going down after the election -- should he get out of stocks and move into fixed and bonds? This led to one of my usual warnings about market timing...and why you shouldn't do it!
Here are web sites and resources mentioned in this week's show:
-- How to Choose a Financial Advisor: 10 Questions
-- NAPFA: National Association of Personal Financial Advisors (fee-only advisors)
-- The ABCs of Annuities: 6 Questions to Ask
-- The Pros and Cons of Annuities
-- Annuity salespeople don't like me
Thanks to everyone who participated and to Mark, the BEST producer in the world. If you have a financial question, there are lots of ways to contact us:
Call 855-411-JILL and we'll schedule time to get you on the show LIVE
Send an email: askjill@moneywatch.com
Tweet me: @jillonmoney
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I SUGGESTED THIS IDEA THE LAST TIME THIS TYPE OF DISASTER HIT AMERICA AND I WILL SUGGEST THIS IDEA AGAIN ! ! ! BECAUSE IT IS A NO-BRAINER THAT THESE TYPE OF NATURAL DISASTERS ARE NOT GOING AWAY..EVER ! ! !
1. Don't Rebuild homes in these natural disaster hot spots until the Insurance Companies Give the homeowner the opportunity to relocate to another town or state that has a surplus of unsold or bank owned homes.
2. Pay the homeowner moving expenses to move to these homes.
3. These homes will be updated for energy efficiency prior to move.
4. These homes would be bigger and or better than the home that was destroyed.
This Special RELOCATE TO A SAFER PLACE TO LIVE Program could have rebates to the homeowner as well as to the Insurance Companies.
Of course not everyone could or would take advantage of this Program but just think about how much money it would save in the long run if only a few people took advantage of this Program..MILLIONS or Billions of Dollars could be saved because when (not if) the next Natural Disaster happened again this these hot spots there would be a few less homes to rebuild..A FEW LESS DOLLARS the Insurance Companies would have to pay out.
THIS WOULD TRANSLATE INTO SAVINGS FOR ALL OF US ! !
Just a COMMON SENSE IDEA ! ! ! This plan would also put more Americans Back To Work upgrading these homes & the Products that would be used in these updated homes would have to be "MADE IN THE USA ONLY"
Again a WIN WIN COMMON SENSE IDEA FOR AMERICA ! !