Is your financial thinking distorted?

The human brain is a wonderful thing, but sometimes we suffer from what psychologists call “cognitive distortions.” Cognitive distortions cause us to perceive the world inaccurately. When we act on these distorted perceptions, we make poor decisions and undermine our own happiness.
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Roth IRAs for the Older Investor

Q: I retired last year. I receive a pretty good pension and I would like to contribute some of that money into a Roth IRA. Is that possible? A: You can only contribute what the IRS deems to be “earned income” to a Roth IRA. Unfortunately a lot of the income many retirees receive does not fall into that category. For example, the IRS specifically excludes
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It’s a bond world

Fixed income markets play a vital role in the global capital markets. They also play an important role in a well-structured investment plan. Unfortunately, fixed income securities, also known as bonds, are a mystery to many individual investors. This week we are going make a foray into the world of bonds. However, the bond market is so huge and includes such a mind-boggling array of securities, there is no way we will be able to do more than scratch the surface.
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What makes a good financial plan good

We often talk about the importance of having a good financial plan, but we rarely discuss what makes a financial plan good. As with most things in life, financial plans come in a variety of qualities and flavors. Knowing what to look for as you shop for a financial plan will help you get the best plan for your particular situation. Financial plans can be either tactical or strategic in nature.
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So, You Want to be a Day-trader

Q: My wife and I have had some success trading stocks and we want to start doing it full-time. I believe we have sufficient capital and we’ve been taking an online course through a reputable discount brokerage firm. What advice can you give me (other than telling me not to do it)?
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Take a look at index annuities

Q: I went to a dinner recently hosted by someone who was trying to drum up interest in fixed index annuities. She said these kinds of annuities would allow me to benefit from the stock market’s upside while guaranteeing that I wouldn’t lose money if the market went down. It sounds too good to be true, but the products are offered by some very reputable insurance companies. What can you tell me about them?
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Prepare now, avoid bankruptcy later

If you are retired, preparing to retire, or one day hope to retire, I encourage you to read an article in Monday’s edition of the New York Times. The article is titled “Too Little, Too Late: Bankruptcy Booms Among Older Americans.” The article is based on a new report by a group called the Consumer Bankruptcy Project. I found the newspaper article so interesting, I tracked down a copy of the report itself.
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