- Gross Expense Ratio vs. Net Expense Ratio
There are two key metrics when considering the costs associated with mutual funds and exchange-traded funds (ETFs): the gross expense ratio and the net expense ratio. The gross expense ratio includes all fees and expenses incurred by the fund, such as management fees, administrative costs and operational expenses. While the net expense ratio reflects the… read more…
- How to Open a 529 College Savings Account
A 529 college savings account is a powerful tool for families looking to save for future educational expenses. These state-sponsored accounts offer tax benefits and flexible investment options to help make saving for college more manageable. By understanding how to open and manage a 529 account, you can take proactive steps toward securing your child’s… read more…
- What Does It Mean If an Investment Portfolio Is Balanced?
Creating a balanced portfolio is a key investment strategy that aims to manage risk and optimize returns. By incorporating a diverse mix of assets such as stocks, bonds and sometimes alternative investments, a balanced portfolio helps spread risk across multiple asset classes. This approach not only minimizes the impact of market volatility but can help… read more…
- How Do You Cash in Savings Bonds?
Cashing in savings bonds is a straightforward process that can be done at most financial institutions or, if you have electronic savings bonds, even online. This article will break down the basic steps to process your request and get the funds deposited into your account. But, if you want hands-on advice about how bonds could… read more…
- How Preferred Stock Dividends Are Taxed
Preferred stock dividends are taxed differently than other investment income. Generally, these dividends are classified as either qualified or non-qualified. Qualified dividends are taxed at the lower capital gains rates, which can range from 0% to 20%, depending on the investor’s income bracket. Non-qualified dividends, on the other hand, are taxed at ordinary income tax… read more…
- What Is the Buy-and-Hold Real Estate Investing Strategy?
The buy-and-hold real estate strategy is a long-term investment approach that buys properties and retains them for an extended period, thereby generating consistent rental income and benefiting from property value appreciation over time. By maintaining ownership, investors can leverage tax advantages, build equity and create a stable, passive income stream. If you’re interested in real… read more…
- How to Diversify Your Retirement Investment Portfolio
Creating a diversified retirement portfolio can spread your investments across different asset classes with the goal of reducing risk and enhancing returns. A mix of stocks, bonds, real estate and other assets could allow you to better withstand market fluctuations and stabilize your financial future. Here’s what you need to know. A financial advisor can… read more…
- Real Estate Syndications vs. REITs for Investors
For investors seeking exposure to real estate, understanding the differences between real estate syndications and real estate investment trusts (REITs) is key. Real estate syndications involve pooling funds from multiple investors to purchase properties, offering direct ownership stakes. In contrast, REITs are companies that own, operate or finance income-generating real estate, allowing investors to buy… read more…
- How to Use Cost Segregation to Defer Taxes on Real Estate
Cost segregation in real estate is a strategic tax planning tool that can allow investors to accelerate depreciation deductions and thereby defer taxes. This strategy is typically used for properties that produce taxable income and not those that operate a loss. By identifying and reclassifying personal property assets like fixtures and fittings from real property,… read more…
- What Is the Formula for Variable Expense Ratio?
The variable expense ratio is a financial metric that helps businesses understand the relationship between their variable costs and sales revenue. By dividing total variable expenses by total sales, this ratio reveals the proportion of revenue consumed by costs that fluctuate with production levels or sales volume. This insight helps companies make informed decisions about… read more…
- How to Check the Value of Your U.S. Savings Bonds
Checking the value of your U.S. savings bonds is straightforward and can be done online through the TreasuryDirect website. Once logged into the portal, you’ll either automatically see the value of your bond or you’ll need to enter its series, denomination and issue date. This process allows you to keep track of your investments and… read more…
- What Are Preferred Dividends?
Preferred dividends are payments made to holders of preferred stock, a type of equity that combines features of both stocks and bonds. These dividends are typically fixed and paid out regularly, often on a quarterly basis. Unlike common stock dividends, preferred dividends must be paid before any dividends are issued to common stockholders, making them… read more…
- Differences Between Management Fees and Expense Ratios
When considering investment costs, the distinction between a management fee vs. expense ratio is important to comprehend. While these terms are sometimes used interchangeably, they refer to distinct components of the costs associated with managing and operating investment funds. The management fee is a charge paid to the fund manager for their expertise in managing… read more…
- Personal Investing Books Everyone Should Consider
There are many ways to learn about investing, but there’s often no substitute for good advice. And a good book on finance and investing is a great place to start. Here are six books for personal investing to start you down the path. Once you have a handle on investing and how you want to… read more…
- What Is Personalized Investment Management?
Personalized investment management involves building a portfolio that is tailored to your needs. With this approach to investing, you or your financial advisor create a plan and portfolio based on specific goals, options and preferences. It varies from a systematic approach, in which your advisor would help you invest in a series of assets defined… read more…
- What Will My Portfolio Be Worth in 10 Years?
Every investor wants to know where their money is going. The point of investing is for your money to grow. Sometimes, you’re trying to achieve a specific goal, such as to retire, buy a home, or take a big trip. Other times you just want to put your money somewhere more fruitful than a savings… read more…
- Are Contributions to Coverdell ESAs Tax-Deductible?
Coverdell education savings accounts (ESAs) are a popular choice for families looking to save for education expenses. But are contributions to these accounts tax-deductible? In short, no, the contributions themselves are not tax-deductible. Though Coverdell ESAs offer other significant tax advantages that can help families grow their education savings more effectively. If you’re interested in… read more…
- 529 College Savings Plans vs. Prepaid Tuition Plans
When it comes to planning for a child’s education, it can help to understand the differences between 529 college savings plans and prepaid tuition plans. Both options offer valuable benefits for covering future college costs, yet are suited to different financial strategies. Comparing these two plans helps families make more informed decisions about the best… read more…
- What Is a Property Dividend?
A property dividend is a distribution of physical assets, rather than cash, given to shareholders of a corporation. This unique form of dividend can include real estate, inventory, or other tangible assets owned by the company. Unlike traditional cash or stock dividends, property dividends can sometimes be more valuable depending on market conditions. This method… read more…
- How Tax-Efficient Is Your Mutual Fund?
Tax efficient mutual funds are designed to minimize the tax liabilities on your investment income, making them an attractive option for investors looking to optimize their after-tax gains. These funds use strategies such as low turnover rates and tax-loss harvesting to reduce taxable distributions. A financial advisor can also help you analyze the growth potential… read more…
- What Is a Gross Expense Ratio (GER)?
The gross expense ratio (GER) is a metric used by investors to assess the total annual cost of managing a mutual fund or exchange-traded fund (ETF). This ratio is expressed as a percentage of the fund’s average net assets, and includes management fees, administrative costs and other operational expenses. A financial advisor can help you… read more…
- What Makes a Dividend Qualified?
A qualified dividend meets specific IRS criteria, allowing it to be taxed at the lower capital gains tax rates instead of the higher ordinary income tax rates. For a dividend to be qualified, the investor must hold the underlying stock for a designated period, and the dividend must be paid by a U.S. corporation or… read more…
- Financial Planning Tips for Real Estate Investors
Financial planning is important for real estate investors to maximize returns, manage risks and maintain long-term financial stability. Understanding cash flow, for example, is one important piece of financial planning, as real estate investors should have enough rental income to cover mortgage payments, taxes and maintenance costs. Meanwhile, diversification can also help mitigate risk, while… read more…
- How to Calculate Depreciation on Rental Properties
Depreciation allows property owners to deduct the costs of buying and improving a property over its useful life. In turn, this reduces taxable income, offering significant tax benefits. To take advantage of these benefits, however, it’s necessary to know how to calculate depreciation on rental properties, which may involve consulting a financial advisor who focuses on… read more…
- How to Manage Your Rental Property on Your Own
Managing a rental property independently can be both rewarding and challenging. But managing properties is more than finding tenants and collecting rent. Effective property management also involves handling tenant disputes professionally and enforcing lease agreements consistently. You may want to work with a financial advisor to help you determine which types of investments are a… read more…