Watch as MSNBC host calls 401(k) plans a scam on her television show and breaks down the Wall Street lies and our crumbling retirement system. . .

This article appeared online at www.johncolanzi.com

Why I Don’t Invest In The Stock Market
by John Colanzi

I’m tired of hearing everyone from the President on down telling me to invest in the stock market.

If you want to help build America, invest in your business. This country was built by small business men and women.

I don’t invest in the stock market because it’s out of my control. I don’t determine how the company is run or where their profits are placed.

On top of all that, the returns are really peanuts compared to what you can earn from a well run business. When the market dropped they said investors shouldn’t worry they should have their money back in 5 years.

Guess what?

If I invest in a good program, I usually make back my investment plus within 5 minutes. Can the stock market do that?

I’ve invested in programs for $10 or $20 and made back 10 times that within 24 hours. I couldn’t even cover the brokerage fees for the cost of starting a business online.

Take control of your future. Take responsibility for your success. You are the future.

Learn how to market on the internet and you’ll never worry whether the economy is up or down. You’re the boss. Your ability will determine your future.

Why are so many people more willing to invest in the markets and not in themselves?

They don’t believe in themselves. They think big business will make the money for them.

I’m going to tell you something that I hope you take to heart. I know you can succeed. I know you can outperform the stock market.

I believe in you. Probably more than you believe in yourself.

Don’t invest in the stock market. Invest in YOU INC.

In the words of Ben Franklin “Keep Thy Shop and Thy Shop will Keep Thee.”

Take off your blinders and realize, you were born to succeed. Invest in you.

Wishing You Success,
John

http://johncolanzi.com

Welcome to the FFG website! If you are looking for a blend of personal service and expertise, you have come to the right place.  FFG is dedicated to providing  “no-hassle” nontraditional financial advice and service to individuals, families and small businesses.  We believe your financial success is rooted in education not manipulation. Thank you for taking time to visit our website.

Brian J. Fischer, President

Fischer Financial Group

I have not written at length about the mutual fund scandal as of yet but this press release from 2009 I happened to come across and thought I would offer quick remarks. Having followed mutual funds for many years, I have come to the conclusion that most (not all) are simply a part of the scam I coin as “Wall Street Greed.” The media entices people to invest in mutual funds saying they are great vehicles because they offer professional management, built in diversification and convenience.

The dark side of some mutual funds is what takes place behind the scenes: market timing, excessive fees and poor performance (relative to benchmark stock indices), shelf space payments – all the stuff you have absolutely no clue about. When all the smoke clears it becomes pretty apparent of what Wall Street’s motive is…to keep your money as long as possible. Why? Because Wall Street makes its money by managing your money…plain and simple.

So when a company like Putnam got exposed during the mutual fund scandal (which continues to this day) for its role in hurting its shareholders with its illegal practices they have to find away to “reinvent themselves” after investors in their funds left in droves. Thus it peaked my interest when I came across this press release in the Boston Globe:

Putnam fund fees will drop or be linked to performance

Reynolds said the management fees for its stock funds are already among the lowest in the industry and he wanted fees on Putnam’s fixed income funds to be as well; currently, he said, the fees on fixed income funds are about average.

Fees on mutual funds have been getting a bad rap lately as seen by the number of lawsuits filed and congressional involvement. So let’s get this right…Putnam is enticing investors back to their funds by promising to lower fees that are already too high and if they beat performance expectations (not defined in release) they get MORE money but if they don’t they get less money. This sounds like a WIN-WIN for Putnam. Any way you slice it Putnam makes money…its just a matter of how much. Now the underlying danger lies in how rich risk Putnam will take with its funds in an effort to “beat performance expectations.”

If Putnam truly wants to be “on the same side of the table with investors” how about Putnam saying they make money ONLY if their shareholders make money. That’s true innovation!

15 Reasons Why Your 401(k) May Be Your Riskiest Investment

By Garrett Gunderson, Author Killing Sacred Cows

Financial institutions are genius marketers. They are able to get millions of Americans to hand over their money with very little thought taken, very little knowledge of the so-called investments offered, and even less control of their investments.

When the evidence is plainly presented, it becomes overwhelmingly clear that putting money into 401(k)s and similar qualified plans is not investing at all — it is one of the riskiest gambles for most individuals. Read the following reasons why I say this, and ask yourself if it’s time to reconsider your 401(k).

1. Limited Opportunity For Cash Flow

Qualified retirement plans, such as 401(k)s and IRAs, do not provide immediate cash flow, which means that you cannot benefit from them through velocity and utilization. The theory is that letting the money sit allows it to compound, but for most people this really means that it stagnates.

Most people will not choose to utilize these funds even when a particularly compelling opportunity arises that will make them far more than the 401(k) would, even accounting for the penalties. This means that numerous legitimate opportunities are passed by as people stay “in it for the long haul.”

2. Lack of Liquidity

The money is tied up with penalties attached for early withdrawal. Although there are a few technicalities that allow penalty-free withdrawals, the restrictions are so numerous that very few know how to get around them.

3. Market Dependency

The performance of the funds is dependent upon market factors that most individuals do not have the knowledge nor the ability to understand or mitigate.

This means that your retirement plans are based on unknowable projections, making for a dangerous and uncertain planning environment. Uncertainty causes fear, and fear leads to mistakes, worry, scarcity, and ultimately lost hopes and dreams. Do you want to live your ideal life only if the market cooperates?

4. The Match Myth

“Take the match — it’s a guaranteed 100 percent return before you even get started in the market!” You’ve heard that before, right?

The problem is that it’s a complete myth — were it true most 401(k) savers could end up with literally billions of dollars at retirement. What is the true impact on the bottom line to you? When do you utilize the match?

5. Lack of Knowledge

How much do you really know about your 401(k)? Do you know what happens to the money? Do you know what funds you’re invested in? Do you know the companies that your funds are invested in? Have you seen financials for these companies and do you know their key executives?

Do you know the fund manager by name, her history, her investment philosophy, her performance? How can you expect to gain a return from something you know so little about? How can you create real, tangible value in the world in the 401(k) scenario?

And how can this be called investing? Without full knowledge of an investment, placing money amounts to little more than gambling, which is the desire to get something for nothing. The “something-for-nothing” attitude – no matter now subconscious – is exceedingly destructive.

6. Administrative Fees

The funds are subject to various administrative fees in addition to expense ratios and 12-b1 fees (for marketing expenses). This is a fact which most people and even many advisors ignore. This means that your returns will be negatively impacted and your projections can be substantially off.

7. Under-Utilization Because of Tax Deferral

If you don’t like paying taxes today, why would you want to pay them any more in the future? In other words, the tax deferral aspect, which is touted as a great boon, is actually a primary factor contributing to qualified plan money being notoriously under-utilized.

Most retirees let the money sit, even during their retirement years, for fear of triggering tax consequences. If you just have to pay the taxes as a later date how is it a tax advantage? The reason there is no tax paid is because you have deferred income by never taking constructive receipt of your earning and instead deferring them into a qualified plan.

8. Higher Tax Brackets Upon Withdrawal

Closely related to the previous problem, the other issue with taxes is that most advice fails to take into consideration the likelihood of you being in a higher tax bracket during your retirement years than you were previously.

Think about it: If you have achieved any measure of success living the accumulation theory, you should actually be in a higher tax bracket at retirement, although most advisors project that you will be in a lower tax bracket.

So this means that deferring your taxes results in a far greater tax burden than would otherwise be incurred using different products and strategies than the conventional route. It’s profound irony that people project healthy returns on their qualified plan while also projecting that they will be in a lower tax bracket at retirement.

9. Estate Taxes

401(k)s are sitting ducks for estate taxes. Much qualified plan money is never utilized by those who actually accumulated it because they hold off so long on withdrawing it in fear of paying taxes.

Yet when the money is passed on to the next generation, there is not only an income tax that can be triggered, it may be subject to an estate tax that there is no internal provision to avoid either. So when the money is passed to the next generation, the government taking a healthy chunk before it passes hands. This begs the question of who is the real beneficiary of the program.

10. No Exit Strategy

Getting into a 401(k) seems simple enough. In fact, many companies start employees’ 401(k) contributions automatically upon hiring them. They sound great – you’re getting a match, tax deferral, a wide choice of funds relating to your risk tolerance.

But how are you going to get out of it? How many people take this into consideration when they start contributions? How many people understand the penalty and tax consequences? Most people don’t fully realize the implications until it’s too late, and so their qualified plan money sits unutilized.

In that case, what is the real rate of return of your money? Once again, in that scenario, who are the real beneficiaries? Not them, and not their heirs to a large extent – it’s the institutions and the government.

11. Subject to Government Control and Change

Did you know your 401(k) does not even technically belong to you? Read the fine print and you will find that it is what’s called an “FBO” (For Benefit Of). In other words, it’s technically owned by the government, but provided for your benefit. It’s essentially a tax code.

If history proves to be a reliable guide, 401(k) funds are therefore in great jeopardy. In the same way that the government raises and lowers taxes at their whim, what is to keep them from changing the rules and taking the money that you so diligently saved?

12. Golden Handcuffs

Are you at your current job because it aligns with your passions and purpose, or because of the great benefits? Are you just holding on long enough until your qualified plan funds are fully vested? Are there ways that you could create more wealth and opportunity by living your Soul Purpose, rather than being attached to the deceptive security of a 401(k)?

13. Disinvesting

Suppose you’ve retired and want to begin taking interest payments from your qualified plan. You project that you can withdraw 6 percent a year, based on an average return of 8 percent a year. However, what happens to your principal when the funds are volatile and the market experiences down years?

Your funds may be receiving an average 8 percent annually, but that means that some years will be lower, some will be higher. If in one year your fund is down 10 percent, you’re tapping into your principal to take your interest withdrawal. At that point, you have only two choices: 1) start withdrawing principal, or 2) leave the money alone until your funds are up again.

14. No Holistic Plan

I’ve witnessed on many occasions people whose finances are in shambles and although they have much more pressing needs, they diligently contribute to their 401(k). They’ve been convinced to do so, of course, because of the match, tax deferral, etc. It’s like a person trying to take care of a scraped knee when their wrist is slit.

What they really need is a macroeconomic approach to their finances that will help them identify, prioritize, and manage all pieces of their financial puzzle, with all pieces coordinated and working together.

15. Neglect of Stewardship

Ultimately, the most destructive aspect of 401(k)s is that they cause many individuals to abdicate their responsibility, abandon self-reliance, and neglect their stewardship over their own prosperity.

People think that if they just throw enough money at the “experts” that somehow, some way, and without their direct involvement they will end up thirty years later with a lot of money. And when things don’t turn out that way they think they can blame others – despite the fact that they only have themselves to blame.

Conclusion

Qualified plans are promoted on such a wide scale because those promoting it have vested interests – and their interests don’t necessarily coincide with yours.

If you currently contribute to a 401(k), stop and think about it for a minute. What is it really doing for you, now and in the future?

The desire to save money for retirement is wise and prudent, but after reading the above, do you think it’s possible to find other investment philosophies, products, and strategies that would meet your financial objectives much more quickly and safely than a qualified plan? Are you really comfortable exposing yourself to this much risk?

How can you mitigate your risk, increase your returns, and create safe and sustainable investments? How can you create more control and better exit strategies, reduce your tax burden, and increase your cash flow?

Your financial future depends on your answers to these questions.

The following is a transcript and video of a speech Michael Moore gave to workers in Wisconsin…definitely eye opening

America is not broke.

By Michael Moore – 3.5.2011

Contrary to what those in power would like you to believe so that you’ll give up your pension, cut your wages, and settle for the life your great-grandparents had, America is not broke. Not by a long shot. The country is awash in wealth and cash. It’s just that it’s not in your hands. It has been transferred, in the greatest heist in history, from the workers and consumers to the banks and the portfolios of the uber-rich.

Today just 400 Americans have as much wealth as the bottom half of all Americans combined.

Let me say that again. 400 obscenely rich people, most of whom benefited in some way from the multi-trillion dollar taxpayer “bailout” of 2008, now have as much loot, stock and property as the assets of 155 million Americans combined. If you can’t bring yourself to call that a financial coup d’état, then you are simply not being honest about what you know in your heart to be true.

And I can see why. For us to admit that we have let a small group of men abscond with and hoard the bulk of the wealth that runs our economy, would mean that we’d have to accept the humiliating acknowledgment that we have indeed surrendered our precious Democracy to the moneyed elite. Wall Street, the banks and the Fortune 500 now run this Republic — and, until this past month, the rest of us have felt completely helpless, unable to find a way to do anything about it.

[youtube=http://www.youtube.com/watch?v=wgNuSEZ8CDw]

I have nothing more than a high school degree. But back when I was in school, every student had to take one semester of economics in order to graduate. And here’s what I learned: Money doesn’t grow on trees. It grows when we make things. It grows when we have good jobs with good wages that we use to buy the things we need and thus create more jobs. It grows when we provide an outstanding educational system that then grows a new generation of inventers, entrepreneurs, artists, scientists and thinkers who come up with the next great idea for the planet. And that new idea creates new jobs and that creates revenue for the state. But if those who have the most money don’t pay their fair share of taxes, the state can’t function. The schools can’t produce the best and the brightest who will go on to create those jobs. If the wealthy get to keep most of their money, we have seen what they will do with it: recklessly gamble it on crazy Wall Street schemes and crash our economy. The crash they created cost us millions of jobs. That too caused a reduction in revenue. And the population ended up suffering because they reduced their taxes, reduced our jobs and took wealth out of the system, removing it from circulation.

The nation is not broke, my friends. Wisconsin is not broke. It’s part of the Big Lie. It’s one of the three biggest lies of the decade: America/Wisconsin is broke, Iraq has WMD, the Packers can’t win the Super Bowl without Brett Favre.

The truth is, there’s lots of money to go around. LOTS. It’s just that those in charge have diverted that wealth into a deep well that sits on their well-guarded estates. They know they have committed crimes to make this happen and they know that someday you may want to see some of that money that used to be yours. So they have bought and paid for hundreds of politicians across the country to do their bidding for them. But just in case that doesn’t work, they’ve got their gated communities, and the luxury jet is always fully fueled, the engines running, waiting for that day they hope never comes. To help prevent that day when the people demand their country back, the wealthy have done two very smart things:

1. They control the message. By owning most of the media they have expertly convinced many Americans of few means to buy their version of the American Dream and to vote for their politicians. Their version of the Dream says that you, too, might be rich some day – this is America, where anything can happen if you just apply yourself! They have conveniently provided you with believable examples to show you how a poor boy can become a rich man, how the child of a single mother in Hawaii can become president, how a guy with a high school education can become a successful filmmaker. They will play these stories for you over and over again all day long so that the last thing you will want to do is upset the apple cart — because you — yes, you, too! — might be rich/president/an Oscar-winner some day! The message is clear: keep you head down, your nose to the grindstone, don’t rock the boat and be sure to vote for the party that protects the rich man that you might be some day.

2. They have created a poison pill that they know you will never want to take. It is their version of mutually assured destruction. And when they threatened to release this weapon of mass economic annihilation in September of 2008, we blinked. As the economy and the stock market went into a tailspin, and the banks were caught conducting a worldwide Ponzi scheme, Wall Street issued this threat: Either hand over trillions of dollars from the American taxpayers or we will crash this economy straight into the ground. Fork it over or it’s Goodbye savings accounts. Goodbye pensions. Goodbye United States Treasury. Goodbye jobs and homes and future. It was friggin’ awesome and it scared the shit out of everyone. “Here! Take our money! We don’t care. We’ll even print more for you! Just take it! But, please, leave our lives alone, PLEASE!”

The executives in the board rooms and hedge funds could not contain their laughter, their glee, and within three months they were writing each other huge bonus checks and marveling at how perfectly they had played a nation full of suckers. Millions lost their jobs anyway, and millions lost their homes. But there was no revolt (see #1).

Until now. On Wisconsin! Never has a Michigander been more happy to share a big, great lake with you! You have aroused the sleeping giant know as the working people of the United States of America. Right now the earth is shaking and the ground is shifting under the feet of those who are in charge. Your message has inspired people in all 50 states and that message is: WE HAVE HAD IT! We reject anyone tells us America is broke and broken. It’s just the opposite! We are rich with talent and ideas and hard work and, yes, love. Love and compassion toward those who have, through no fault of their own, ended up as the least among us. But they still crave what we all crave: Our country back! Our democracy back! Our good name back! The United States of America. NOT the Corporate States of America. The United States of America!

So how do we get this? Well, we do it with a little bit of Egypt here, a little bit of Madison there. And let us pause for a moment and remember that it was a poor man with a fruit stand in Tunisia who gave his life so that the world might focus its attention on how a government run by billionaires for billionaires is an affront to freedom and morality and humanity.

Thank you, Wisconsin. You have made people realize this was our last best chance to grab the final thread of what was left of who we are as Americans. For three weeks you have stood in the cold, slept on the floor, skipped out of town to Illinois — whatever it took, you have done it, and one thing is for certain: Madison is only the beginning. The smug rich have overplayed their hand. They couldn’t have just been content with the money they raided from the treasury. They couldn’t be satiated by simply removing millions of jobs and shipping them overseas to exploit the poor elsewhere. No, they had to have more – something more than all the riches in the world. They had to have our soul. They had to strip us of our dignity. They had to shut us up and shut us down so that we could not even sit at a table with them and bargain about simple things like classroom size or bulletproof vests for everyone on the police force or letting a pilot just get a few extra hours sleep so he or she can do their job — their $19,000 a year job. That’s how much some rookie pilots on commuter airlines make, maybe even the rookie pilots flying people here to Madison. But he’s stopped trying to get better pay. All he asks is that he doesn’t have to sleep in his car between shifts at O’Hare airport. That’s how despicably low we have sunk. The wealthy couldn’t be content with just paying this man $19,000 a year. They wanted to take away his sleep. They wanted to demean and dehumanize him. After all, he’s just another slob.

And that, my friends, is Corporate America’s fatal mistake. But trying to destroy us they have given birth to a movement — a movement that is becoming a massive, nonviolent revolt across the country. We all knew there had to be a breaking point some day, and that point is upon us. Many people in the media don’t understand this. They say they were caught off guard about Egypt, never saw it coming. Now they act surprised and flummoxed about why so many hundreds of thousands have come to Madison over the last three weeks during brutal winter weather. “Why are they all standing out there in the cold? I mean there was that election in November and that was supposed to be that!

“There’s something happening here, and you don’t know what it is, do you …?”

America ain’t broke! The only thing that’s broke is the moral compass of the rulers. And we aim to fix that compass and steer the ship ourselves from now on. Never forget, as long as that Constitution of ours still stands, it’s one person, one vote, and it’s the thing the rich hate most about America — because even though they seem to hold all the money and all the cards, they begrudgingly know this one unshakable basic fact: There are more of us than there are of them!

Madison, do not retreat. We are with you. We will win together.