Gelden Geld


If all of the world’s gold were squished together, it would form a cube just 68 feet on each side.  That’s a very small amount of gold in a very big world.  No wonder it’s so expensive.  In times of economic uncertainty people often rally around what they see to be smart, safe investments.  For some people this is treasury bonds and low-risk stocks, for others it is physical assets like gold.  Although gold does have substantial value, ($1,553.65 per ounce as of May 15th) nothing can be produced from it and thus the only value gained from it is having it when others do not.  This is also a quandary because the price of gold can only rise when it is highly sought after, meaning that many people must buy gold in order to keep the price of gold up.

There are tangible benefits to owning gold, such as fiscal security in the event of an extreme economic downturn or global disaster. However, the astute financial mind of Warren Buffet likens it to building a bomb-shelter in your basement.  If you ever end up needing the bomb shelter than you have made a terrific purchase. However if no crisis occurs where a bomb shelter is necessary, you will be stuck with the sunk cost of a bomb shelter.  I suppose it could make a decent man-cave.

The uncertainty in economies and markets has helped fee a frenzy in gold-buying.  GLD, the exchange-traded fund introduced by State Street in 2004 is the second-largest ETF measured by assets under management.  But with an average daily trading volume of over 10 million shares it seems that buyers aren’t  ‘investing’ as much as they are placing a bet.  Nothing wrong with trying to win a bet but with gold trading at historical highs maybe there are better bets to place.

Students and their Mountains of Debt

Student debt has become such a problem that it has even surpassed credit card debt in terms of both money owed and delinquency rates.  What is truly staggering about this is that the United States citizens’ credit card debt of $697 billion comes from 80% of the population who own credit cards, compared to only 15% who have student loans.

The student debt crisis can largely be traced to the almost disgusting increase of college tuition over the last 30 years.  Since 1982, the cost of a 4-year college tuition has risen by 400%, which really causes problems when taken into account that the Median Household Income over this time has only risen by 150%.  Many prospective college students of today are also under-informed or misinformed when they are making their decision on where to go to school as well as how to fund it.  Most students go into college with the expectation that they will be able to get a job relevant to their degree right out of college, and thus will not need to worry about their expensive student loans.  This has not been the case, and as the economy continues to twist and turn, more and more recent college graduates are finding themselves in a bind.  Student default rates rose from 11.6% to 15% in the last fiscal year as over 9% of recent college graduates find themselves unemployed.

Fortunately there are a few things that can help with the payment of loans, such as loan consolidation or forgiveness.  If you know someone who is saddled with student debt and unsure of their options,  and  are loaded with information on student loans as well as ideas on how to lower your debt.

Digital Spring Cleaning

With the growing digitalization of life, it is  harder to keep personal information personal.  The two easiest targets for advertisers and spam to exploit are e-mail addresses and phone numbers, which now-a-days are required for accomplishing or purchasing practically anything.


E-mail spam has been around for years.  There have been MSNBC programs about prolific spammers and why people spam, but unfortunately the spammers have harnessed new technology to make spamming even easier.  The best way to prevent spam from reaching your inbox is to use an accredited e-mail service and its respective spam notification system.  Hotmail, Yahoo and Gmail all pride themselves in preventing spam but a few messages still slip through the cracks.  Aside from choosing a secure email service, do not ever post your email address online, and be wary of phony-looking websites that ask for your email address or other personal information.


Text spam is a newer form of spam that has taken off with the amalgamation of telephones and the Internet.  Sending messages via the Internet costs the spammer nothing, but could cost you something depending on your data plan.  An easy way to get rid of spam is to call your service provider and ask them to prevent all Internet messages from getting to your phone.  If you still encounter spam after this, the next best step is to forward the message in question to 7726 (SPAM), which will alert your service company that the message your received is from a spammer.


The quickest way to get rid of telemarketing calls is to visit the National Do Not Call Registry at  Simply enter your information and within thirty days you will no longer receive those annoying telephone calls.  Unfortunately this does not apply for calls from political candidates, as the government believes we should be fed a large ration of fabrication and slander leading up to the election.

Catalog Mailing Lists

Although the process to remove yourself from catalog mailing lists requires more work than the previous 3 options mentioned, once you get the hang of it it is the easiest of them all.  The best way to do this is to go to and sign up for free.  Once there you can enter the names of catalogs that you no longer wish to receive, and after providing your address and the customer ID and key from the back of the catalogs you will be kept up to date on the status of your cancellation.  As you cancel your subscriptions, the website also tracks the trees and gallons of water you have helped save, as well as the reduction in greenhouse gases and solid waste your cancellation has made.


The state of being volatile
1. The state of having a low boiling point and evaporating readily
2. (computing) The state of not retaining data in the absence of power
3. The state of being able to fly
4. The state of being unpredictable
5. (Financial markets, countable, plural volatilities) A quantification of the degree of uncertainty about the future price of a commodity, share, or other financial product

Life is full of ups and downs. While we can anticipate some events, such as when a child is born or we close on our first house, but we’re thrown off by others, such as a job layoff or a medical emergency. Interestingly, one person’s up is another one’s down, such as when the youngest leaves home for college. (I cried for a month, my husband broke in new golf clubs). Throughout our lives, then, we experience periods of stability – same ol’, same ol’ – and periods of volatility.
The same holds true for stock markets. Periods of stability are followed by periods of volatility and right now, we’re in the midst of a volatile period. One day the markets are up and all the indicators are green and the next day they’re down and everything has turned red. The third day could be green or red; it’s hard to say. In such volatile times, attempting to anticipate the impact of any new piece of information seems futile because that news can quickly be swallowed up by newer news and so the volatility continues.
So what can we do about it?
1. Accept that volatility exists. When you invest, recognize that the prices of your investments will rise and fall, sometimes sharply. As much as we would all like the rise to be a consistent upward movement, it just doesn’t happen that way.
2. Have a long term investment plan and stick to it. Let’s say your investment goal is to stop working and retire in 15 years. Your plan includes saving a certain amount per year and investing so that it grows over this long-term. Stay with the plan. Making long-term investing decisions based on each day’s market news can throw a wrench in your long-term goals.
3. Understand your emotions and keep them out of your investment-decision process. Making long-term investment decisions based on emotions such as fear or greed causes you to lose. You end up buying stocks after prices have gone up and selling them after they’ve gone down. And then you kick yourself so don’t do it.
4. Don’t take more investment risk than necessary to achieve your goals. At a basic level, this simply means don’t have too much invested in stocks. But it also means having a proper investment mix (stocks, bonds, cash) and diversification (not too heavily invested in a single company, industry, or country).
5. Don’t look. Sounds crazy but this period of volatility will end at some point. If you find yourself checking your portfolio daily, stop. Unless your plan and your goals have changed, looking daily isn’t going to do any good. Make sure your overall financial is in solid shape and let this period of volatility pass.


re•tire•ment (r -t r m nt)
1. The act of retiring.
2. The state of being retired.
3. Withdrawal from one’s occupation, business, or office.
4. Withdrawal into privacy or seclusion.
5. A place of privacy or seclusion; a retreat. See Synonyms at solitude.

The American Heritage® Dictionary of the English Language, Fourth Edition copyright ©2000 by Houghton Mifflin Company. Updated in 2009. Published by Houghton Mifflin Company. All rights reserved.

Retirement is the subject of more daydreams than any other topic. Millions of workers fantasize about the day they no longer need to show up for work. For some of us, that day is getting close though for many, there are years to go. As a financial planner I have the opportunity to work with couples and watch as they head into retirement. Retirement is a big transition and it requires thought, planning, and energy to be successful. Happy transitions to retirement that I have seen share three common traits.

First, couples that have their own hobbies, volunteer activities, or part-time work separate from their spouse seem happier longer. If you want a thriving retirement, stay active, add some new things to the mix and don’t, by all means don’t, assume every day should be a dawn to dusk exercise in togetherness. Too much togetherness seems to increase irritability though I don’t know quite why.

Second, couples need to have shared financial values in retirement. It’s important to know each other’s goals and make sure there is a retirement plan to both agree to. The last thing you want is for your spouse to suddenly shift gears and start spending down the savings faster than you can afford. Both of you need to know where the money is, how much there is, and how it will last for your lifetime. It’s fine to have ‘his’ money and ‘her’ money but major decisions need to be joint ones.

Third, retirement takes planning. For every one of us who has dreamed retirement down to the very last detail, there is someone who hasn’t done any planning at all. One thing I’ve seen consistently is the sooner you start, the better your retirement will be. If you know what you want to do when you’re retired it’s easier to figure out what that will cost, add lot of padding for the unknowns, and then save for it. If you’ve got a plan you are more relaxed and less anxious. That peace of mind is invaluable.

So whether you are two, ten, or twenty years away from retiring it’s not too early to start the discussion. And you will arrive at the point in your life where those daydreams will end because you’ll be living them.



boot•strap (b t str p )
1. A loop of leather, cloth, or synthetic material that is sewn at the side or the top rear of a boot to help in pulling the boot on.
2. An instance of starting of a computer; a boot.
tr.v. boot•strapped, boot•strap•ping, boot•straps
1. To promote and develop by use of one’s own initiative and work without reliance on outside help: “We’ve bootstrapped our way back with aggressive tourism and recruiting high tech industries” (John Corrigan).
2. Computer Science To boot (a computer).

1. Undertaken or accomplished with minimal outside help.
2. Being or relating to a process that is self-initiating or self-sustaining.
by (one’s) (own) bootstraps
By one’s own efforts.

While pulling on a pair of boots the other morning I slipped my fingers through the straps and gave them a good tug. I got to thinking about bootstrapping and what a great way it is to start a business. Starting your own business by bootstrapping is an exhilarating, creative endeavor. Okay, maybe that’s too rosy of a spin. Bootstrapping can be pretty stressful and scary, too. But, it’s a mixture of highs and lows, of good days and bad that can be pretty rewarding if you let it. I’ve worked with quite a few entrepreneurs and there are a few characteristics that consistently show up among the successful ones.
First, a successful bootstrapper is cheap. It forces you to be surprisingly resourceful. When my partner, Beth, and I started our software company many moons ago we were both committed to making our seed money go as far as possible. She found computers for us at a great price. In these pre-Internet days I spent time in the law library of the local university learning how to file trademark documents and develop distributor agreements. Travel to trade shows was determined by where we had a free place to crash. As our business expanded, we stayed true to our frugal roots and that helped us succeed where others in our field didn’t.
Second, a successful bootstrapper is resilient. Those who have never owned their own business can’t appreciate how stressful it can be when the inevitable setbacks occur. Some days there’s nothing else you can do except pick yourself up, dust yourself off, and start all over again. Well, that, and maybe break into a bag of strawberry Twizzlers.
One final characteristic I’ve seen is that good bootstrappers always pay it forward. You never forget how hard it was when you were just starting out. I don’t try to judge someone’s business idea on whether or not it’s a ‘good’ idea. Sometimes someone can have a great idea but be at the wrong time or place. Or maybe they just don’t have the resources to pull it off. It takes a certain amount of courage to start a business so I say hats off to anyone who steps out and tries. You never know, it just might be the next big thing.

Definition provided by: The American Heritage® Dictionary of the English Language, Fourth Edition copyright ©2000 by Houghton Mifflin Company. Updated in 2009. Published by Houghton Mifflin Company. All rights reserved.


churn (chûrn) n. A vessel or device in which cream or milk is agitated to separate the oily globules from the caseous and serous parts, used to make butter.v. churned, churn·ing, churns a. To agitate or stir (milk or cream) in order to make butter.b. To make by the agitation of milk or cream: churn butter.2. To shake or agitate vigorously: wind churning up the piles of leaves. See Synonyms at agitate.
3. To buy and sell (a client’s securities) frequently, especially in order to generate commissions.

Who wouldn’t enjoy tasting freshly churned butter?  Slather it on a thick slice of warm, homemade bread for a taste of nostalgia so good you can almost smell it.  Sad to think that such a warm, homey word has such an unpleasant meaning when used in the world of investments.

Stockbrokers generally earn a commission when they purchase an investment for you.  They also earn a commission when they sell an investment for you.  So when a broker buys, he makes money, when he sells, he makes money.  The more transactions, the better for him, but not for you because you’re paying those commissions.  The term for it is ‘churning’ and it’s against the law – though not necessarily easy to prove.

So what can you do?  Avoid the churn.  If you have someone managing your investments, make sure you pay attention to what is happening with your money.  Make sure you know how your investment manager is compensated.  Is there a fixed fee?  Or is he/she paid commissions?  These are often called ‘loads’ or ‘sales charges’. Don’t be intimidated if you get an answer that doesn’t make sense; ask again until you’re satisfied.  And if you get an answer you don’t like, don’t get agitated (see definition #1 above).Take charge and find someone to work with who will put your interests ahead of theirs.   After all, it’s your money.

The American Heritage® Dictionary of the English Language, Fourth Edition copyright ©2000 by Houghton Mifflin Company. Updated in 2009. Published by Houghton Mifflin Company. All rights reserved.


ob·fus·cate ( b f -sk t , b-f s k t )tr.v. ob·fus·cat·ed, ob·fus·cat·ing, ob·fus·cates

1. To make so confused or opaque as to be difficult to perceive or understand: “A great effort was made . . . to obscure or obfuscate the truth” (Robert Conquest).

2. To render indistinct or dim; darken: The fog obfuscated the shore.

[Latin obfusc re, obfusc t-, to darken : ob-, over; see ob- + fusc re, to darken (from fuscus, dark).]

ob fus·ca tion n.

ob·fus ca·to ry ( b-f s k -tôr , -t r , b-) adj.1

Obfuscate is a wonderful word.  I just wish it didn’t apply so often to issues in personal finance.  Annuity contracts are one example.  Recently I met with a client who owned several annuity contracts and she wanted help translating them – from obfuscatory English to plain English. The contracts were thick documents that I’m convinced were carefully designed to keep anyone from actually wanting to read them.   Buried within were onerous sounding surrender charges, various subaccount fees and expenses, commissions, penalties, insurance fees, redemption fees, and enough other terms to make you nervous.  Wouldn’t it be nice if one of the insurance companies selling annuities would lay out the information in a simple diagram or a flow chart? It would make a lot more sense and it would help consumers evaluate and understand, for example, what the real cost of that death benefit is.

If you find yourself struggling to understand the costs, benefits, and tradeoffs of an investment, perhaps it’s due to a deliberate obfuscation of the information.  So what should you do?  If you don’t understand it, don’t buy it.  It’s that simple.

1. The American Heritage® Dictionary of the English Language, Fourth Edition copyright ©2000 by Houghton Mifflin Company. Updated in 2009. Published by Houghton Mifflin Company. All rights reserved.