A Look Back at Military Money Might’s Postings for September 2008

Now that Military Money Might has been going strong for almost two months, I thought that I would share with you some of our most popular articles from the past sixty days.  Please feel free to share these with your friends and family.  Thanks…

Notable articles from the blog:

1. Mutual Fund Recommendations From Money Magazine – The top seventy mutual funds rated by the magazine.  If you are looking for a new fund to invest in, start with this list as a good screen.
2. Kiplinger’s Personal Finance Magazine’s Top 25 Mutual Funds – My favorite personal finance magazine lists its top twenty-five mutual funds in its annual list.  Kiplinger’s includes what it deems as the perfect portfolio asset allocations for different time in an investor’s life.  For young investors, check out their long term portfolio.
3. An Army Second Lieutenant (2LT) Will Earn Over $100,000 – My favorite rule of thumb is the “Rule of 72”.  Find out how long it will take for your money to double in value…24 years at 3% for example.
4. “Personal Finance 101″ PowerPoint Presentation – Check out an introduction to personal finance.
5. Knowing the Factors that Make Up Your Credit Score – Knowing the key attributes of your score will let you know how to improve it.
6. Tips To Make Bill Paying Easier – Make things automatic with bill paying services on the internet.  Pay yourself first and save in late fees.
7. What Is a Good Stock: A Six Part Series – What characteristics make an individual stock a good investment?  We covered many attributes over a week.

Blog Carnivals (The Best of the Blogshere):

Military Money Might was featured in the following Blog Carnivals this month…..

• Money Hacks Carnival #31
• Financial Fiesta

I hope that you have enjoyed the blog these past two months as much as I have enjoyed writing it and that you will continue reading.  Thanks again….

 

Hank

Interesting Articles for August and September 2008

I usually read about thirty blogs in my Google RSS reader.  Thank goodness a lot of them do not post everyday.  I follow both a lot of civilian and military personal finance blogs and some logistics blogs as well.  I thought that I would share some of the articles from my feeder that I have saved as a favorite.

Notable articles from my reader:

Personal Finance:

• Top Eight Characteristics of a Great Mutual Fund – Guest post of Cash Money Life about the most important attributes to look for when you are trying to find the right mutual fund to invest in.
• The Inner Workings of a Car Dealership (and How To Use Them to Your Advantage). – This is an incredible article about what goes on behind the veil at a car lot.  It talks about how a dealership actually makes money.  This was actually my favorite article of the last two months.
• How to Prepare for Buying a Home – Great introduction guide on the points to look for and consider when buying a home.
• How to Sell Your Stuff on eBay – I love this comprehensive guide.  It has a lot of great tips to ensure that you will get the most money for your junk like making sure your auctions end on Sunday nights.
• Archives: Useful Homebrew Financial Calculators – I really like calculators on the internet and excel spreadsheets that will make your life easier.
• Free Debt Snowball Spreadsheet – I’m a huge fan of Dave Ramsey, and this blog had an interesting spreadsheet to help you start paying off your credit card and other debts.
• Investing in a Bear Market – I love bear markets, and it is one of the best times to buy great stocks at discount prices.
• Military Financial Horror Stories – or How Not to Buy a Car – Great posting about young military members who don’t always spend less than they make especially when returning from a deployment.

Supply Chain & Logistics:

• US Government Should Stop Subsidizing Amtrak and Let It Privatize – Since 1971, the federal government has been spending over $1 billion a year to keep the passenger train service running.
• Mexico’s Rich Embedding GPS-Assisted RFID Tags Under Their Skin In Case of Kidnapping – Instead of using it on pets, we have graduated to using radio frequency tags on humans as well. 

Mutual Fund Recap for September 2008 – Month and Yearly Fund Average Returns By Category and Style

I talk a lot about the benefits of good growth stock mutual funds on this blog, and I wanted to give you a little bit of perspective about where the overall market has gone this past month.  I’m sure that you are saying to yourself, “I know where the market has gone…straight down the toilet!”  And, I totally understand that. 

My mutual funds, like Dodge and Cox Stock, are way down this year, but it helps to compare your stocks and mutual funds to the overall market in order to gauge just how poorly they are doing.  Below is a list of major mutual fund categories for you to get a sense of how your investments are fairing.  Remember to compare apples to apples in this case.  Find your fund’s category and compare it to the market’s total returns below.

		TOTAL RETURNS
Category	One Month	One Year	Three Years
Stock Mutual Funds
Large – Cap Growth	- 8.16%	- 19.74%	0.90%
Mid – Cap Growth	- 9.07%	- 21.37%	1.44%
Small – Cap Growth	- 6.33%	- 20.23%	0.64%
Balanced	- 3.47%	- 8.64%	1.52%
International	- 8.69%	- 25.95%	3.41%

Source: Morningstar.com

If you enjoyed this posting, you might also like these:
1. An Army Second Lieutenant (2LT) Will Earn Over $100,000 in 2032
2. How to Pick a Good Individual Stock to Buy? – Part 1
3. Lump Sum or Dollar Cost Averaging?

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Protect Yourself From These Classic Investment Scams

In today’s financial crisis, stock market scams are alive and well.  Many of these schemes prey on citizens’ fears, and the increasing trend for these schemes are running wild with the current financial turmoil that is consuming America.  Below are a list of the most famous investment scams and tips on how to protect yourself from them.

Ponzi Scam.  During the Great Depression, Charles Ponzi promised to double investors’ money within 90 days.  He collected money from investors and paid them off with the proceeds from new investors who entered the scam.  Eventually, the last investors who piled in were left with nothing when Ponzi ran off with their money.  An off shoot of this scam is also when owners of a business sell off more than 100% of the business to investors in small bite sized pieces.  This was the plot of the Broadway musical, “The Producers”, who sold the rights to the show’s profits to investors hoping that the show would tank at the box office so they could pocket the money and not payout anything to the investors.

Nigerian 419.  Named after the section of the small African country’s criminal code that handles fraud, the internet scam artists offer would be investors a cut of money they are trying to smuggle out of the country for an upfront fee.  A couple of years ago, a U.S. navy officer used some of his ship’s petty cash fund to try and earn a quick profit with this scheme, but he was burned when the Nigerian money was never wired to him.  Cash Money Life, one of my favorite personal finance blogs, went into even more details about this scam in a recent posting.

Pump and Dump.  Investors in penny stocks sold on the over the counter (OTC) bulletin boards are often the victims of this scam.  Early investors in a cheap penny stock that is too small to trade on a regular New York stock exchange are touted through spam e-mails and internet discussion boards, which creates an artificial buzz about the stock encouraging novice investors to pile in.  The scam artists then dump their shares of the thinly traded securities which cause the newly inflated price to plummet for everyone else.  This scam was predominantly featured in the movie, “Boiler Room”.

Pyramid Scheme.  While not necessarily a stock scheme or scam, I cannot resist adding the pyramid scheme to the list here as well because of the prevalence on military bases.  Pyramid deals seem to attract many military spouses looking for a little extra income.  The sales force on the bottom of the pyramid does all of the heavy lifting and kicks up a portion of their sales to the top members of the pyramid who signed the bottom levels up.  How many military spouses have makeup, rubber plates and bowls, vitamins, or designer baskets hidden away in the closet unsold?

How to Protect Yourself.  All stock brokers and insurance agents have to be licensed to sell their products and services.  You can check to make sure that individuals that you are conducting business with are fully licensed at www.finra.org and www.nasaa.org.  Only about 10% of all investments scams and complaints involve licensed dealers.  So, checking these websites ahead of time can solve most of your potential problems.

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A Horrible Boss Can Be the Best Thing for Your Career

Most of us have had some really horrible bosses throughout our careers. A 2001 study found that almost 80% of the employees surveyed said their boss was a lousy manager. And, 70% of the survey’s respondents said that their immediate superior had “no clue” what to do to become a good manager. But, a bad boss may actually be the best thing for your career and help your job performance.

Learn from his mistakes. I am constantly watching my boss and taking mental notes. What is he doing wrong? What is he doing right? What could I do better if I was in his shoes? Eventually, I am going to be in his position. One day, I am going to move up the ladder and take more responsibility, and I want to be ready. By taking the best and worst attributes from all your bosses and learning from them, you are assured to be a better leader.

Rise to the challenge. A horrible boss challenges you. Many times we find out that we can accomplish greater things than we ever thought possible because of far fetching goals and unrealistic expectations put on us by a horrible boss. Many subordinates get into a funk and are actually less productive when they are faced with a bad boss. But, if you recognize the situation early and challenge yourself to rise above it, you will not fall victim to your boss’s mediocrity. It is the perfect time to excel and leave your boss in the dust. Do not let a bad boss affect your job performance.

Become a subject matter expert. The more that you know about a specific topic, the more indispensable you will become. You will have a wider berth from your bad boss if you are viewed as essential to the team’s tasks. The star quarterback always receives the least amount of scrutiny from the head coach even when he messes up. No one wants to ruffle the star’s feathers, and the same can be true in the corporate world. Strive to be the star, and your boss may just leave you alone even when you make an error.

Distance yourself. Stay away from your bad boss as much as you can. Birds of a feather flock together, and you do not want to be brought down by a negative or incompetent boss. It will always be better if your star can shine on its own without your boss always being nearby. If you identify your boss as being a poor leader, chances are that his bosses have seen it too. You do not want to be caught up in his eventual downfall.

If all else fails…..

He will move on. Hang in there. The average American switches jobs, gets promoted, transfers, moves on, etc. every two to three years. It’s an even faster turnover in the military. Your boss won’t be your boss forever. Hang in there and wait him out.

How do you deal with a bad boss? I’d love to hear your comments…
If you enjoyed this posting, you might also like these:
1. An Army Second Lieutenant (2LT) Will Earn Over $100,000 in 2032
2. How to Pick a Good Individual Stock to Buy? – Part 1
3. Best Advice I Ever Received

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Are You Covered by Your Renters or Home Owners Insurance Policy? Double Check

A study by the National Association of Insurance Commissioners revealed that many homeowners think the standard insurance policy covers more than it does. Among their mistakes:

• 33% of homeowners believe that flood damage is covered.
• 68% think vehicles such as cars, boats and motorcycles stolen from or damaged on their property are covered.
• 51% think damages from a break in the water line on their property supplying water to their home are covered.
• 37% think damages due to a break in the sewer line on their property that connects to their municipal sewer system are covered.
• 35% think damages from earthquakes are covered.
• 34% think damages from mold are covered.
• 31% think damages from termites or other infestation are covered.
• 22% think pets stolen from or injured on their property are covered.

You might not be as covered as you think you are. Check with your insurer to make sure that you have the coverage you need and want. You do not want to be caught with an inadequate policy when you need it the most.

Joseph “J.J.” Montanaro is a certified financial planner with USAA Financial Planning Services, one of the USAA family of companies. Montanaro is a West Point graduate and served in the U.S. Army for six years on active duty. He is currently a Lieutenant Colonel in the U.S. Army Reserve.