Episode #55: Everything You Need to Know About Investing in IPOs

In recent months, IPO investing has been getting a bit of attention as quite a few popular companies such as Airbnb and DoorDash entered the public market this year. We dedicated this episode to exploring what every investor should know about investing in initial public offerings. Throughout the episode, Grant reviews the process of going public, how the IPO markets have changed over the last few decades, and whether we should expect adequate returns from IPO investing.

Show Notes

[01:05] Basics of IPO Investing – What IPO investing is, why it has been in the news recently, and the process of going public.

[05:57] IPOs and Investment Banks – Investment banks play two crucial roles in the process of an initial public offering. Grant reviews what these roles are and how an investment bank interacts with different parties involved in the process.

[09:54] The Open Market – Stock price fluctuations that happen right after a company goes public and what investors should keep in mind about them. 

[12:09] Recent Trends – How private funding and venture capital mechanisms have changed the way companies enter the open market over the last few decades and what it means for investors.

[16:47] Deciding Whether to Invest in IPOs – Grant shares his thoughts on what you should take into consideration when deciding whether to invest in IPOs.

[18:47] Brands and IPOs – How the popularity of a brand may drive the stock price of a company right after going public.

[21:43] Having IPOs in Your Portfolio – How the performance of your investment portfolio may be affected by investing in IPOs and tips for making smart decisions around IPO investing.

Resources

What Is an Initial Public Offering? :
investopedia.com/terms/i/ipo.asp

Episode #54: The True Cost of Homeownership With Kelly Luethje

In recent months, mortgage interest rates have been significantly reduced across the country. Although it may sound like an attractive opportunity for people considering buying a house, there are several complexities related to homeownership. In today’s episode, we’re joined with Kelly Luethje to explore the true cost of homeownership. Kelly is a CERTIFIED FINANCIAL PLANNER™ and the founder of Willow Planning Group. Throughout the episode, Kelly shares her wisdom on the complexities of homeownership and what we should consider before buying a house.

Show Notes

[02:19] Kelly’s Background – Kelly talks about her work and how she helps young professionals with their financial decisions related to housing.

[04:40] Homeownership & Renting – Things to consider when deciding between homeownership and renting.

[09:17] Costs Involved in Homeownership – Kelly reviews some of the homeownership related costs that are different from a  rental.

[19:41] Common Mistakes – Kelly shares some of the most common mistakes she sees people make when buying their first home and how to avoid them.  

[24:18] Kelly’s Experience of Moving – Kelly recently moved to a new home in a different area. She shares what she experienced during the transition in terms of costs, lifestyle, and how it shaped her professional life.

[28:42] Selling a Property – Grant and Kelly dive into what you should consider when deciding whether to sell your old property or rent it out.

[35:08] Kelly’s Practice – Kelly shares her career journey, the story of her business, and the work she does with her clients.

[40:50] Investor Relations – Kelly talks about her work in investor relations and the experience of working with investors and teams of professionals. 

Resources

Kelly’s Blog: www.willowplanninggroup.com/blog/

Episode #53: Unexpected Retirement: How to Determine Whether to Take an Early Retirement Package

In recent months, many companies have been struggling with numerous aspects of their business due to the economic hardships caused by the pandemic. This situation forces businesses to look for creative ways to cut costs, and one of the methods that companies may use for this is offering early retirement for some of the employees. In today’s episode, we explore what to do if you receive an early retirement offer and how to look at the offer objectively and make a pragmatic decision.

Show Notes

[01:39] Cutting Costs – Why companies are starting to offer more and more early retirement packages for employees and how the legal aspect of employment comes into play.  

[05:19] Unexpected Decisions – For most people, an early retirement offer may come as a surprise, and it may become a difficult and emotional decision that you have to make in a short period. Grant shares his thoughts on how you can approach the issue to make a wise decision. 

[08:13] Analyzing the Offer – How to analyze an early retirement offer and quantify its benefits.

[11:10] Retirement & Health Benefits – How an early retirement offer may affect your workplace retirement benefits and your health benefits.

[14:29] Financial Plan – Another crucial factor to consider when making this decision is how early retirement might impact your cash flow. Grant shares his thoughts on how to analyze your cash flow before making the decision.

[16:48] Turning Down an Early Retirement Offer – Potential changes that may happen in your workplace if you decide to turn down an early retirement offer and how to prepare for them.

[19:57] Life After Retirement – Grant shares his thoughts on how to keep your financial stability and manage your time effectively after retirement.

Resources

72t Distributions: The Ultimate Guide to Early Retirement
www.abovethecanopy.us/the-ultimate-guide-to-early-retirement-with-72t-distributions/

Episode #52: Top Year End Tax Planning Moves with Biden in the White House

After weeks of delay caused by legal battles surrounding the election, at this point, all signs point to the fact that Joe Biden will be inaugurated as the President of the United States of America. As we discussed in detail in a previous episode, Joe Biden's tax plan contains tax reforms that affect taxpayers in numerous ways. In today's episode, Grant dives into some of the tax planning opportunities you should consider in the coming months.

Show Notes

[01:42] The Process of Reforming Tax Rules – How the current political situation and the pandemic may affect Joe Biden's plan to reform the tax code.  

[07:22] Retirement Plans – Biden's tax plan includes a new tax credit scheme for 401k plans. Grant reviews what comes under this change and how it may affect people in different tax brackets. 

[09:46] Itemized Deductions – How the proposed provisions for itemized deductions leave us in a unique situation and what it means for taxpayers.  

[15:06] Accelerating Income and Deductions – Why you should focus on accelerating income and deductions in the coming months.  

[17:29] Tax Credit for First Time House Buyers – Grant shares his take on the new tax credit scheme and how to make it beneficial to you. 

[19:02] Student Loan Forgiveness – Grant talks about some of the speculations around Biden's plan for student loan forgiveness under the federal student loan program. 

[22:00] 1031 Exchanges – How the provisions in section 1031 of the tax code work and how eliminating section 1031 may affect the real estate industry.

[29:16] Long-term Capital Gains – What Biden's tax plan means for long-term capital gains of high-income earners and how to minimize the effect of this proposed tax reform.

[33:51] 401k Plans for Small Businesses – Why small business owners may want to rethink their 401k plans entirely.

Resources

Episode #43: An Objective Review of the Biden Tax Plan:
https://growmoneybusiness.com/podcast/episode43

Episode #51: Non-Qualified Stock Option Basics

Non-qualified stock options are a great way to incentivize and reward employees and the management of publicly traded companies. We dedicated today’s episode to exploring the basics of non-qualified stock options. Throughout the episode, Grant reviews how non-qualified stock options work, tax implications, and a few things to keep in mind if you have been granted some non-qualified stock options. Stay tuned until the end of the episode, where Grant talks about some tax planning opportunities that could help you minimize the amount of tax you have to pay in the long run.

Show Notes

[01:26] Introduction – Basics of options trading and how non-qualified stock options work. 

[07:33] Important Terms – Grant explains a few crucial terms related to non-qualified stock options: strike price, fair market value, vesting, grant date, and expiration date. 

[11:09] Taxation – How non-qualified stock options are taxed and when you will be taxed for non-qualified stock options. 

[18:19] Concentration Risk – Why most people exercise and immediately sell when they are granted non-qualified stock options and how to objectively look at your company and handle the concentration risk associated with non-qualified stock options. 

[21:38] Exercise and Cashless Exercise – How the two methods work and things to keep in mind when you decide which one to choose. 

[25:52] 83(b) Election – 83(b) election is a provision that comes under the Internal Revenue Code that’s related to non-qualified stock options. Grant reviews how it works and how you can take advantage of it.  

[31:31] Hanging on to Shares – Grant talks about when to hang on to shares and when to sell immediately.     

Resources

How Are Non-Qualified Stock Options (NSOs) Taxed?
www.abovethecanopy.us/how-are-non-qualified-stock-options-nsos-taxed/

Episode #50: My Best & Worst Trades Ever

Over the last few months, we have received numerous questions from our listeners that have focused on what Grant is doing personally with his finances. In today's episode, Grant shares two stories about his best trade and worst trade ever. He dives into why he made these investment decisions and what caused the very different outcomes of the two trades. Stay tuned until the end of the episode, where Grant shares his take on what he learned from these two trades. 

Show Notes

[01:11] Long-term Investments – Grant explains why he always focuses on long-term, consistent investing. 

[04:03] Data & Trading – How data analytics could be beneficial for making better decisions in trading. 

[10:36] Undervalued Securities – Grant dives into some of the techniques he has been using to discover undervalued securities across multiple industries. 

[15:05] The Best Trade – Grant shares how he was able to get a substantial return from buying stocks of an undervalued insurance corporation. 

[25:42] The Worst Trade – How Grant ended up losing money due to an aggressive investment decision. 

[34:45] Causes of Failure – Grant shares his take on the factors that caused the loss from his worst trade and what you should keep in mind to produce satisfactory long-term returns.    

Resources

Ep #46: A Beginner's Guide to Factor Investing: growmoneybusiness.com/podcast/episode46

Episode #49: How to Make Millions While Paying $0 in Federal Income Tax

A few weeks ago, The New York Times published an article that created controversy around President Trump’s tax returns. One of the most controversial claims of this article was that President Trump paid only $750 in federal income tax in the year that he won the election. In today’s episode, Grant dives into specific sections of the tax code that enabled President Trump to reduce his tax bill and how you can incorporate similar strategies in your tax planning. 

Show Notes

[01:59] The Controversy – What the New York Times revealed in their investigation and how it created controversy around President Trump’s tax returns. 

[06:46] Tax Returns – How the tax return process differs as the complexity of a business increases and why big businesses and wealthy individuals employ large teams to handle tax filing. 

[12:35] Tax Planning & Tax Evasion – Grant shares his thoughts on the difference between tax planning and tax evasion and how tax planning can be beneficial for minimizing tax while complying with the tax rules.  

[15:57] Federal Income Tax and Other Taxes – Grant reviews different types of taxes that are in effect in the United States.  

[18:05] Deductions – Grant explains how deductions work in tax filing for businesses and individuals. He also shares his thoughts on how you can take advantage of deductions to minimize your tax amount. 

[22:31] Legitimate Business Expenses – How to identify opportunities for eligible business expenses you can use as deductions to reduce your taxable income. 

[28:55] Depreciation – How tax deductions apply for the depreciation of commercial real estate and how you can implement this as a deduction in your tax filing to reduce your tax bill. 

[32:50] Capital Goods – How to strategically plan your commercial equipment purchases in a way that gives you tax benefits.  

[35:03] Net Operating Loss – Grant reviews the new regulations around net operating losses and how you can take advantage of it to reduce your tax bill.     

Resources

Resources:
nytimes.com/interactive/2020/09/27/us/donald-trump-taxes.html?

Episode #48: The Three Golden Rules of Investing

Many of the investing principles we use in our portfolios today are related to a concept called modern portfolio theory. This concept was first introduced by Nobel Laureate Harry Markowitz in a paper written in 1952. In today's episode, Grant dives into the history of modern portfolio theory, the benefits of implementing this concept, three golden rules we can derive from the modern portfolio theory, and how you can implement these three rules in your portfolio. 

Show Notes

[02:15] History of Investment Strategies – Grant dives into how portfolio management evolved over several decades and how it influenced the investment arena. 

[06:55] The Scientific Method – How financial professionals started to utilize the scientific method for investing. 

[10:05] Modern Portfolio Theory – Grant reviews what constitutes modern portfolio theory and how to build a portfolio that complies with the modern portfolio theory.  

[16:03] Stocks & Other Assets – Why your decision about how much of your portfolio to be in stocks versus anything else is the most significant decision you will ever make.  

[18:00] Risk & Return – How risk and return characteristics of different investment types affect the performance of a portfolio. 

[21:54] Diversification – How to use diversification to your advantage and why diversification is beneficial for you. 

[28:24] Long-term Consistency – How consistency can improve the performance of your portfolio.      

Resources

Modern Portfolio Theory: 
investopedia.com/terms/m/modernportfoliotheory.asp 

Ep #46: A Beginner's Guide to Factor Investing: 
growmoneybusiness.com/podcast/x9ykf9576e352jd-xs3l5-l355n-pc3nj-4l3tz-fsye7-g9gha-tdcyt-b7r9a-wja6y-ksbz4-9nlgl 

Episode #47: Mailbag! What Grant is Doing With His Kids' 529 Plans, Spousal vs. Survivor Social Security Benefits, and Whether Value is Dead

This week on the Grow Money Business podcast we have another mailbag episode. Grant covers four questions from our listeners about Social Security benefits, the future of value investing, distribution strategies for retirement, and saving for your kids' higher education. 

If you have more questions you'd like us to cover, visit growmoneybusiness.com, and drop your questions in the Mailbag section. Grant will answer your questions in a future episode. 

Show Notes

Question 01 – Social Security claiming rules with regard to spousal versus survivor benefits. 

[01:56] Eligibility & Monthly Benefit – Grant reviews the eligibility criteria for claiming Social Security benefits and the process of calculating your monthly benefit. 

[06:10] Filing for Benefits – How the age of retirement affects your monthly benefit and things you should keep in mind when deciding the optimal time to file for Social Security benefits. 

[08:44] Spousal Benefits – How a couple with different income levels could plan their retirement in a way that gets them the maximum benefits. 

Question 02 – "Do you think value investing is dead?" 

[15:32] Performance of Value Stocks – Grant shares his take on how value stocks performed compared to growth stocks over the years and why value investing is not dead. 

Question 03 – "What is the optimal distribution strategy if you're retiring at 65?" 

[25:48] Building Your Strategy – Grant shares several factors you should consider when building your distribution strategy and how to communicate with your spouse about planning your retirement. 

Question 04 – "How are you playing the 529 game for your kids?" 

[30:37] 529 Plan – How the 529 plan works, how tax laws in different states affect 529 plans, and things to keep in mind when setting up 529 plans for multiple kids.  

[36:12] Grant's Strategy – Grant shares how he optimizes his strategy to match his specific requirements and how you can prepare for future changes in the education system.    

Resources

Episode #46: A Beginner's Guide to Factor Investing: growmoneybusiness.com/podcast/x9ykf9576e352jd-xs3l5-l355n-pc3nj-4l3tz-fsye7-g9gha-tdcyt-b7r9a-wja6y-ksbz4-9nlgl 

Episode #44: Using Asset Location to Improve Investment Returns: https://growmoneybusiness.com/podcast/x9ykf9576e352jd-xs3l5-l355n-pc3nj-4l3tz-fsye7-g9gha-tdcyt-b7r9a-wja6y

Episode #46: A Beginner's Guide to Factor Investing

This week on Grow Money Business we dive into another fascinating investment strategy: factor investing. Factor investing is a strategy that focuses on selecting securities based on attributes that are linked to higher returns. Throughout this episode, Grant covers what factor investing is, how you may implement it in your investment efforts, and some of the things you should keep in mind when engaging in factor investing. Stay tuned until the end of the episode, where Grant shares some valuable tips for minimizing your risks. 

Show Notes

[01:00] Background – The history of index investing, how it works, and how index investing evolved over the years.   

[08:40] Factor Investing – How the concept of trying to identify companies that would outperform evolved into factor investing. 

[14:09] Factors – Grant explains some of the most important factors that contribute to the performance of stocks. He also reviews the Three-Factor model developed by Nobel Laureate Eugene Fama and distinguished financial researcher Kenneth French. 

[20:58] Factor Investing In-depth – Factor investing has some unique characteristics that differentiate it from traditional index investing. Grant explains what these characteristics are and what they mean for the investors. 

[24:21] Value  & Growth Stocks – Grant shares his take on how the performance of value and growth stocks varied throughout the last decade and what trends may emerge in the near future.  

[27:14] Adapting to Market Trends – How to be mindful about changing market conditions and what you should keep in mind when working with a professional. 

[33:28] Making Wise Investment Decisions – How to improve your investment decisions using factor investment strategy. 

[37:33] Who is a Good Candidate for Factor Investing? – Grant shares his take on things you should consider when deciding whether factor investing is a suitable strategy for you.   

Resources

Bloodletting and Evidence-Based Investing: abovethecanopy.us/bloodletting-and-evidence-based-investing/ 

Episode 44: Using Asset Location to Improve Investment Returns: growmoneybusiness.com/podcast/x9ykf9576e352jd-xs3l5-l355n-pc3nj-4l3tz-fsye7-g9gha-tdcyt-b7r9a-wja6y 

Episode #45: Emotions & Money Messaging With Mariah Hudler

In today's episode we have another distinguished guest: Mariah Hudler. Mariah is a financial therapist who helps people build balanced, comfortable relationships with money. Throughout this episode, Mariah shares her wisdom about what contributes to our attitude toward financial matters, how our backgrounds impact our financial decision making, and what you can do to improve your relationship with money. Stay tuned until the end of the episode, where we talk about some valuable tips for reducing financial stress.  

Show Notes

[01:54] Mariah's Story – Mariah talks about her clinical work, how she helps people improve their financial health using financial therapy, and how to identify whether you need to seek help from a financial therapy practitioner. 

[07:58] The Value of Financial Literacy – Why financial literacy is a crucial part of life and what measures can be taken to improve financial literacy. 

[12:43] Money Scripts – Mariah talks about an interesting concept of dividing money-related behaviors into four categories. 

[18:58] Approaching Financial Therapy – Mariah's process of getting started with clients to help them with their financial health. 

[24:12] Personal Background and Financial Health – How someone's background and past events can shape their financial habits and behaviors. 

[26:32] Adapting Behaviors – Mariah explains some of the measures she takes to guide her clients toward safer financial behaviors. 

[31:52] Financial Therapy Timeline – Mariah shares her thoughts about focusing on long-term and short-term goals depending on the background and needs of her clients. 

[36:19] Working Virtually – Mariah talks about the effectiveness of conducting therapy sessions virtually.  

[41:11] Mariah's Transition into Financial Therapy – Mariah talks about her transition from clinical therapy to the financial aspect of therapeutic work.  

[44:31] Emotional Issues Related to Entrepreneurship – Common finance-related emotional issues entrepreneurs and business owners experience and how to effectively manage the impact of these issues.  

[52:05] Handling Financial Stress – Tips and tricks for reducing financial stress and anxiety.   

Resources

Connect with Mariah:

korufinancialtherapy.com 

mariahhudler.com  

Episode #44: Using Asset Location to Improve Investment Returns

This week on Grow Money Business we dive into an area that is often overlooked in the investment arena: asset location. Asset location is the concept of placing investment assets in different types of accounts in order to maximize returns. Throughout the episode, Grant dives into how this concept works, what benefits you can get from thoughtfully planned asset location, and what you should keep in mind when implementing this concept in your portfolio.  

Show Notes

[01:08] Introduction – What asset location is, how it evolved, and how far asset location can improve your investment returns.  

[04:26] Types of Taxation – Grant dives into a few different methods of taxation and how properly planned asset location can be beneficial for you.  

[10:47] Implementing Asset Location – How to place different asset classes in various types of accounts in a way that maximizes your investment returns. 

[16:15] Expected Return & Tax Efficiency – Grant explains in-depth about two crucial factors you should take into consideration when implementing your asset location strategy. 

[21:13] Placing Assets in Different Types of Accounts – Grant reviews some examples of how you can prioritize and place your assets in the right type of account based on tax preference. 

[26:44] Adapting to Changing Market Conditions –  Market conditions tend to shift due to numerous reasons. Grant explains how you can make tactical shifts in your investment strategy to adapt to new situations.  

Resources

How to Use Strategic Asset Location to Reduce Your Tax Bill - Above the Canopy:

www.abovethecanopy.us/strategic-asset-location/ 

Bogleheads Forum: 

https://www.bogleheads.org/wiki/Tax-efficient_fund_placement  

Episode #43: An Objective Review of the Biden Tax Plan

As we approach the presidential election, we're getting more and more details about the campaign promises made by the candidates. We dedicated this episode to reviewing some of the provisions Joe Biden proposes in his tax plan. Throughout the episode, Grant shares his thoughts on numerous aspects of the Biden tax plan and how the proposed provisions may affect businesses, employees, and investors. 

Show Notes

[01:05] The Legislative Cycle – Grant shares his thoughts on the process of making changes to tax legislation and when the tax changes may become effective if the democratic candidate gets elected.  

[07:00] Itemized Deductions – How the scheme of deductions proposed in the Biden tax plan differs from the current procedures.  

[11:19] Qualified Dividends & Long Term Capital Gains – Grant reviews the provisions available in the Biden tax plan for your investments. 

[15:05] Retirement – Joe Biden's tax plan contains some provisions to optimize the 401k system. Grant explains what these changes mean for employees.   

[21:34] Student Debt – How income-based student loan repayment programs work, how taxation comes into play for student loan forgiveness under these programs, and related changes proposed in the Biden tax plan.  

[30:00] Inheritance – Grant reviews the current tax provisions available for inheritance and what Biden proposes in his tax plan for inherited properties. 

[38:02] Social Security – As we discussed in the previous episode, the Social Security system is under somewhat stress right now. Joe Biden also plans to implement some changes in levels of wages that are subject to Social Security tax. Grant dives into what these changes mean for the general public. 

[42:02] Corporate Tax Rates – The Biden tax plan includes an increase in tax rates for corporations, which may contribute to a substantial increase in federal revenue. Grant shares his thoughts on what this means for businesses.  

[46:40] Opportunities – What it takes to practically implement the changes proposed in the Biden tax plan and a couple of ways you can take advantage of these changes if Joe Biden gets elected. 

Resources

Reviewing the Biden Tax Plan: www.abovethecanopy.us/reviewing-the-biden-tax-plan/ 

Episode #42: Did Trump Just Kill Social Security? growmoneybusiness.com/podcast/x9ykf9576e352jd-xs3l5-l355n-pc3nj-4l3tz-fsye7-g9gha-tdcyt 

Episode #42: Did Trump Just Kill Social Security?

The Social Security system has been under stress for years, and lost tax receipts due to COVID-19 hasn’t helped the viability of the program.  President Trump recently issued an executive order that allows employers to defer Social Security taxes from the paychecks of their employees for the rest of 2020.  In today’s episode, Grant talks about how the Social Security system works and how this executive order may affect the viability of the Social Security trust fund. Stay tuned until the end of the episode, where we talk about what you should consider when deciding whether to defer your Social Security tax.  

Show Notes

[01:32] Skepticism About Social Security – How Social Security is set up, why it’s under stress, and what causes the skepticism about the Social Security program. 

[07:33] Viability Forecast – Grant reviews the process of assessing the viability of the Social Security trust fund and what the latest forecast tells us about the current status of the fund. 

[10:10] Impact of COVID – Grant shares his take on how the pandemic affected the viability of the Social Security system.  

[17:30] President Trump’s Executive Order – How the provisions in the recent executive order work, what it means for employees, and the political aspect of this decision.  

[22:15] Improving the Social Security System – Grant shares his take on some of the possible changes to the Social Security system that may improve its viability.  

[31:15] Should You Defer Social Security Tax? – Grant shares some of the things you should consider when deciding whether to defer your Social Security tax. 

Resources

How It Works: President Trump’s Payroll Tax Deferral Executive Order  gop-waysandmeans.house.gov/how-it-works-president-trumps-payroll-tax-deferral-executive-order/ 

Episode #35: What Does COVID-19 Mean for Social Security? growmoneybusiness.com/podcast/x9ykf9576e352jd 

Episode #41: Stock Dividends & Buybacks: Arguing Both Sides of the Debate

In recent years, stock buybacks have been getting quite a bit of attention in the financial news as companies are spending more and more money on buying back their own shares. In today’s episode, we cover several aspects of dividends and stock buybacks, including how they work, how different corporations approach distributing dividends, how buybacks affect the economy, and why you should be paying attention to them. 

Show Notes

[02:40] Dividends – How public companies distribute their profit to shareholders through dividends. 

[05:06] Value & Growth – Why some companies decide to share their profit with the investors while others reinvest their profit back in the business. 

[10:07] Dividend Investment Strategies – How you can incorporate dividends into your investment strategy and why you should not solely rely on dividends to make investment decisions. 

[13:46] Dividends & Tax - How dividends are taxed and what you should keep in mind when making investment decisions related to dividends. 

[16:24] Stock Buybacks – Grant explains what stock buybacks are, why companies prefer to buy back their own shares, and what advantages investors get from stock buybacks.  

[21:19] Negative Effects of Stock Buybacks – How stock buybacks are related to the way executives are incentivized and how it affects the investors. 

[28:51] Long Term Viability – Grant shares his take on how the current system is gradually pushing executives toward unsustainable levels of stock buybacks and why executives must focus on the long term viability of the businesses.  

Resources

Harvard Business Review - Why Stock Buybacks Are Dangerous for the Economy: 

hbr.org/2020/01/why-stock-buybacks-are-dangerous-for-the-economy 

Stock Buybacks: A Breakdown 

www.investopedia.com/articles/02/041702.asp  

Episode #40: Whether You Should Care About Stock Splits With Michal Skowronski

Since Apple, Tesla, and a few other companies have recently announced stock splits, we’ve been getting questions about how stock splits affect the position of the investors. And for today’s episode, we have another distinguished guest to enlighten us about stock splits. Michal Skowronski, a CERTIFIED FINANCIAL PLANNER™, and the founder of Skylark Wealth joins us today to review what stock splits are, why companies tend to like it, and what investors should know about stock splits.  Stay tuned until the end of the episode, where we talk about the impact of influencers giving financial advice on social media. 

Show Notes

[02:00] Michal’s Background – How Michal works with clients nationwide and abroad through his virtual practice. 

[07:30] What is a Stock Split? – Michal explains what a stock split is and a few reasons why a company may decide to split their stocks. 

[12:04] The Marketing Aspect of Stock Splits – Grant and Michal review the marketing concept that makes stock splits appealing to companies. 

[18:56] Reverse Stock Splits – What a reverse stock split is and the pros and cons of reverse stock splits. 

[22:21] Psychological Effects of Stock Splits – How stock splits affect the behavior of the investors and what you should keep in mind to maintain a strong investment strategy. 

[28:40] Social Media & Investing – Michal shares his take on the flawed investment strategies that are frequently advertised on social media and why these flashy, aggressive strategies may not achieve good outcomes in the long term. 

[38:13] Risks of Investing – Why risky investment strategies may seem attractive to amateur investors, where they may fail, and what you can do to maintain your mental stability to make successful investment decisions.   

[41:01] Influencers & Investing – Grant and Michal share their thoughts on how some influencers have been sharing potentially misleading content on social media and why they get more attention than financial advice from qualified professionals.  

[45:20] Knowledge & Entertainment – How financial professionals can utilize technology to create reliable and entertaining content that leads people in the right direction. 

Resources

Michal’s Website: skylarkwealth.com 

Stock Splits: www.sec.gov/fast-answers/answersstocksplithtm.html 

Reverse Stock Splits: www.investor.gov/introduction-investing/investing-basics/glossary/reverse-stock-splits 

Episode #39: Mailbag!

This week on the Grow Money Business podcast we have another mailbag episode. Grant covers four questions from our listeners about student loan payments, the impact of zero dollar trading commissions, selling your stocks due to the current situation in the markets, and the economic impact of the upcoming election. 

If you have more questions you’d like us to cover, visit growmoneybusiness.com, and drop your questions in the Mailbag section. Grant will answer your questions in a future episode.

Show Notes

Question 01 – “I heard that I wouldn’t have any student loan payments due for the rest of the year. Should I keep making the payments anyway?” 

[03:53] Administrative Forbearance – How the administrative forbearance works and what it means for students and parents.  

[05:43] Deciding Whether to Continue Making Payments – Grant reviews several factors you should take into consideration when you’re deciding whether to continue making student loan payments. 

[09:09] Refinancing Student Loans – For some borrowers, refinancing a student loan with a private lender makes more sense, depending on the career path they choose. Grant explains the pros and cons of remaining in the federal system and refinancing with a private lender. 

Question 02 – “How do we think Robinhood is going to impact trading in the markets?” 

[12:48] The Story of Robinhood – Robinhood is a fintech company that was launched in 2013. Over the last couple of years, they managed to push all the major brokerage firms to zero dollar trading commissions. Grant reviews Robinhood’s business model and how they make money without brokerage commissions.  

[17:32] The Impact of Robinhood – How Robinhood influenced the industry, how it attracts lots of amateur investors, and what you should take into consideration if you’re utilizing aggressive trading strategies. 

Question 03 – “We’ve just had this crazy run-up in stocks. Is now a good time to sell? This just looks completely unsustainable.” 

[27:53] Making Decisions for the Long Term – Why it’s essential to focus on optimizing your wealth and plan for the long term. 

[30:54] The Impact of National Debt – How the amount of debt we have as a country may affect the markets. 

Question 04 – “How will the election impact the markets?” 

[38:13] Volatility After Election – Grant explains why we may see a lot of volatility after the election, regardless of who gets elected. He also shares his take on what to expect from each party, in terms of taxation and policies. 

Resources

Coronavirus Turmoil, Free Trades Draw Newbies Into Stock Market: wsj.com/articles/coronavirus-turmoil-free-trades-draw-newbies-into-stock-market-11588158001 

Coronavirus and Forbearance Info for Students, Borrowers, and Parents: studentaid.gov/announcements-events/coronavirus 

Episode #38: Don’t Sleep on Long-Term Disability Coverage With Katie Brewer

In today’s episode, Katie Brewer from Your Richest Life Financial Planning joins us to chat about long-term disability insurance.  Katie is a CERTIFIED FINANCIAL PLANNER™, and shares some wisdom she’s picked up over the years surrounding why LTD coverage is so important and what to look for when evaluating a policy.

Throughout the episode, Katie and Grant review many aspects of long-term disability insurance,  how to decide whether to obtain coverage, and a few things you can do to reduce the cost of a policy.

Show Notes

[01:27] Katie’s Background – Katie shares how she helps her clients make smart financial decisions.  

[07:27] Why Long-term Disability is Important – Katie shares her thoughts on why it’s crucial to have a safety net in case of an illness that prevents you from working. 

[11:14] Details of Long-term Disability – What constitutes a disability, how long-term disability insurance works, and different ways insurance companies structure their long-term disability policies. 

[19:18] Evaluating a Policy – Katie and Grant review several factors you should consider when you’re evaluating a long-term disability insurance policy. 

[22:43] Riders – Riders are a set of options that come with your insurance policy. These are commonly available in long-term disability policies. Katie dives into details of the most common riders and their benefits.  

[25:54] Residual Disability – What happens if you’re only able to work part-time due to a long-term disability and how you can choose your insurance options to prepare for such a situation. 

[31:57] Group Coverage – Grant and Katie discuss what you can do if you have a group insurance policy that does not fulfill your expectations.  

[35:45] Future Insurability – How you can update your insurance options to match your future needs and what to consider before switching to a new insurance policy. 

[43:15] Working with Insurance Agents – Katie shares her thoughts on why it’s essential to work with independent insurance agents who are not beholden to one insurance company.  

[50:39] Taxability of Benefits – How taxation comes into play, depending on how your insurance policy is structured. 

[56:00] Insurance Through Professional Organizations – Grant and Katie share their experiences of obtaining group insurance policies through professional organizations.  

[58:20] Final Thoughts – Katie sums up the most important things you should keep in mind when you’re thinking of obtaining a long-term disability insurance policy.

Resources

Katie’s Website:  yourrichestlifeplanning.com

Find Katie on Social Media:  facebook.com/yrlplanning

twitter.com/KatieYRL

Episode #37: The Refi Race: Taking Advantage of Ultra-Low Interest Rates

During the last couple of weeks, we’ve been getting a lot of questions about debt refinancing. Due to decreasing interest rates, refinancing seems to look like a good option for many people. We dedicated today’s episode to discussing the details of refinancing. Throughout the episode, we review several types of debt and what you should keep in mind if you’re thinking about refinancing. Stay tuned until the end of the episode, where Grant shares some valuable tips for consolidating credit card debt if you’re struggling with multiple credit cards.

Show Notes

[01:22] Mortgage – How a mortgage works and available options for financing a house. 

[04:22] Deciding Whether You Should Refinance – Grant reviews several factors you should consider to figure out whether refinancing your mortgage is a good idea.  

[09:54] 15-Year Fixed Rate Mortgages – Grant shares his take on why you should be mindful of the pros and cons of swapping into a 15-year fixed rate mortgage.  

[12:15] Student Loan Debt – Because of the low rates, refinancing may look like a good option for those who currently have student loans. Grant reviews what other options are available as an alternative to refinancing and when to think about refinancing. 

[19:20] Credit Card Debt – Why credits card debt is different from a mortgage and how to take advantage of the credit card system.  

[23:16] Consolidating Credit Card Debt – Grant reviews several options that are available to you for consolidating your credit card debt. 

[30:49] Business Debt – Grant explains why this is a good time for businesses that struggle with cash flow to consider refinancing. 

Resources

Episode 34 - Why College Is So Expensive & How to Pay for It With Robert Farrington: podcasts.apple.com/lk/podcast/why-college-is-so-expensive-how-to-pay-for-it-robert/id1489821030?i=1000485750202 

A Consumer’s Guide to Mortgage Refinancing – The Federal Reserve Board:  www.federalreserve.gov/pubs/refinancings/ 

Settling Credit Card Debt – FTC Consumer Information: www.consumer.ftc.gov/articles/0145-settling-credit-card-debt 

Episode #36: The Ins and Outs of Long Term Care Insurance

As we grow older, most of us are going to need help with activities of daily living. Long-term care insurance is a product that is designed to help with this.  It’s also a product that’s in the news for positive as well as negative reasons.  We dedicated this episode to exploring what long-term care insurance is, whether it’s a good fit for you, and some other items you should consider before obtaining a long-term care insurance policy.  

If you have specific questions for us to cover, visit growmoneybusiness.com, and drop your questions in the Mailbag section. Grant will answer your questions in a future episode. 

Show Notes

[01:42] Background – What long-term care insurance is, what it covers, and how long-term care insurance policies evolved over the years. 

[09:24] Statistics – Grant reviews statistics from the US Department of Health and Human Services about the percentage of people who are going to need long-term care assistance in their life. 

[12:27] Deciding Whether You Need It – Why you should consider your financial status when you’re thinking about obtaining a long-term care insurance policy. 

[15:15] State Facilities – Things you should keep in mind if you’re considering a state facility for long-term care. 

[19:09] When to Obtain Long-Term Care Insurance – Grant shares his take on the ideal age for obtaining a long-term care insurance policy and the reasons behind it. 

[22:27] Pricing Issues – Grant explains how the way long-term care insurance pricing was structured in the early years and how it affected the premiums over the next couple of decades. 

[27:52] Drawbacks – Grant explains how the premiums may further increase in the future and some alternate options you can use to make the situation better. 

[31:30] Practicality of Long-Term Care – Important things to keep in mind if you’re planning to take care of your loved ones yourself. 

Resources

What is Long-term Care Insurance? - longtermcare.acl.gov/costs-how-to-pay/what-is-long-term-care-insurance/ 

Long-term Care Providers and Services Users in the United States - US Department of Health and Human Services: www.cdc.gov/nchs/data/series/sr_03/sr03_43-508.pdf