2014: Where to Invest Money in Mutual Funds

If you are an average investor you should invest money in mutual funds, but knowing where to invest will be a real challenge in 2014. So, let’s first eliminate places you don’t want to go and then focus on where to invest money to make the best of it.This game I call ELIMINATION, and it’s really an application of the scientific method you may have learned in general science class, tailored to determine where to invest. Once you know your alternatives, you eliminate the real losers. Then you pick your best alternatives or choices from those that are left.First, eliminate mutual funds based on the costs involved when you invest. Avoid those with sales charges (loads). There is no good reason to pay money just to invest money in mutual funds. Go with NO-LOAD choices. Then eliminate those with yearly expenses of 1% or more. These costs and other information can easily be found in a fund’s description. When you invest $10,000, it can cost over $500 for sales charges (loads) and $200 or more for yearly expenses.Now that we’ve eliminated the high cost alternatives, the question is where to invest money in 2014 and beyond to cut costs and (by doing so) increase our investment returns. Answer: no-load, index funds. Total cost to invest can be less than 1% per year, period. All costs simply reduce the value of your account, and in a real sense is money that comes out of your pocket.Next, let’s look at the categories or choices available based on where a fund will invest money for its investors: stocks, bonds and the money market. We’ll start with the stock alternatives, keeping in mind that for 2014 and beyond… low, but rising interest rates are in the forecast. Eliminate growth and volatile small-company-stock choices. They are riskier and generally pay little if anything in dividends. Where to invest money: look for funds that have terms like high quality, dividends, and growth AND income on their description page. Look for a dividend yield of 2% or more.In the low-interest rate environment of 2014, a 2% or higher stock dividend yield looks attractive compared to earning considerably less than 1% at the bank; and this dividend helps to support stock prices should the stock market decline. Alternatives paying little in dividends offer no such cushion in a declining market. For further diversification there’s another option as to where to invest: sector funds that specialize in areas like gold, natural resources, and real estate stocks.In the bond arena eliminate choices described as highest quality or long-term in nature. Where to invest money: medium quality, intermediate-term bond funds. Medium quality alternatives invest mostly in corporate bonds that are graded as medium to high quality. They pay considerably higher dividends than the highest quality choices that often load up on U.S. treasury bonds, resulting in considerably lower dividends for investors. The somewhat higher risk of medium quality vs. highest quality is not substantial.On the other hand, long-term bond funds pay higher dividends than intermediate-term alternatives, but with this higher dividend comes a substantial increase in investor risk. If interest rates heat up and climb in 2014, all bond investments will lose money – but the long term variety will get crushed. Rising interest rates send bond values down. In your search for where to invest money in the bond department for 2014 and beyond, definitely avoid long-term choices. Long term spells “high risk” for investors when interest rates threaten to go up.Now let’s talk about where to invest money for safety. For the money you invest that must be safe, eliminate both the stock and bond categories from consideration. Go with money market funds. These investments do not fluctuate in price, they pay dividends based on current interest rates, and there are no sales charges (loads) to worry about. In the super low interest rate environment of 2014, expect about as much in dividends as your bank pays in savings and checking accounts: about zero. If rates do go up as forecast, you can expect their dividends to rise as well. In 2007, before the financial crisis, money market funds were paying about 5%. In 1981 when interest rates peaked they paid 20%!In summary, here’s where to invest money in mutual funds for 2014 and beyond. In the stock arena invest in no-load stock index funds that invest in high quality dividend-paying stocks. In the bond fund department go with no-load bond index funds that invest in intermediate-term, medium to high quality corporate bonds. Where to invest money for safety: money market funds.Don’t work against yourself in deciding where to invest money in mutual funds. In both the stock and bond categories you can avoid costly sales charges (loads). You can also cut yearly expenses (and all of your choices will have them) when you invest money in index funds. These do not pass high management costs on to investors. They keep costs low by simply investing in line with a stock or bond index to duplicate its results.In other words, index funds do not pay money managers big bucks to TRY to out perform an index (like the Dow Jones Industrial Average). In deciding where to invest money in mutual funds in 2014 and beyond keep the following thought in mind. Few, if any, money managers have a proven track record of out performing the indexes on a consistent basis. You rarely get what you pay for when you invest money in mutual funds with high investor costs.

What To Consider When Looking For Accounting Software

Using accounting software is inevitable if you want to keep proper financial records of your business. You need proper financial records so that you make informed business decisions or for submitting taxes etc. Finding the right accounting software package can be a difficult task given that there are a lot of accounting package to choose from. So, how do you go about choosing an accounting software package for your business? I have made a list of things to consider when you choose accounting software for your business. The information is more useful to those organisations that are small (from 0-9 employees), do not have an IT department and do not have or cannot afford full time or qualified accountant.There are two types of software to choose from. You can either choose desktop software or cloud/online software. Desktop software is the one that you install on your computer. You can only access the software on the computer it was installed. Cloud or online software is the one you access via a web browser and you access it on any device such laptop, tablet or smartphone as long as there is an internet connection. Here are some of the things to consider;The software must be affordable. You have to consider your budget and the cost of the software. You do not have an infinite budget and you therefore want the cost to be affordable. Cost of desktop software usually includes purchase price e.g. $199.96 for QuickBooks Pro 2013 and sometimes annual fees or annual upgrade fees. Cost of cloud software is usually charged at per month for each user. Prices for cloud software can be as little as free as in the case of Wave Accounting or $29 per month for Sage One.The software must be easy to use. Hiring a qualified accountant can be costly and sometimes not necessary. You may therefore need to hire someone who is less qualified person to do the bookkeeping. A less qualified person can be able to prepare a proper set of financial records provided that the software is simple to use and understand. All you may need is one day training and you are good to go.The software must be secure. Security is very important especially when you use an online/cloud software application. You don’t want to lose precious financial information to hackers etc. How do you know that the software is secure? Well, look out for things like 256 bit SSL encryption, TRUSTe certified privacy, VeriSign secure etc.The software must be packed with features you need. Most software come packed with a lot of features. There is always a danger of paying for features that you do not need and therefore cannot use. As a small business owner, you are likely to need a software that will let you invoice your customers, capture bills, import your bank statements (so that you do not manually capture them) and print reports (such as balance sheet, general ledger, trial balance, vat report, age analysis, income statement, debtors ledger and creditors ledger).There must be plenty of support. You want software that is backed with support. It comes a time when you have forgotten how to capture an invoice or printout a certain report and you need help fast. Support is always vital in those situations, so you need to check if your provider provides support.The software provider must be a going concern. By this I mean that the provider must be able to stay operational for many years to come. The provider must therefore have a strong financial backing and must show commitment. You really do not want a situation you entrust someone with your financial information and only to lose access to it because the software provider is no longer operational.So which one do you choose? I will leave that for you to decide. You have all the ammunition you need to make an informed decision.

Fake News And Distrustful Government Leadership During Disasters

Why doesn’t anyone ever check the news on non-political topics? It seems there has been a big smoke screen lately when it comes to Natural Disasters. We are constantly being told such events are the “Worst” ever in history. Just recently, we saw Hurricane Harvey flood out Houston TX area, they told us it was the worst Hurricane damage ever. Not true. They told us such a flood in that region was unprecedented, also not true, Houston has big flood events at least twice per decade, yes, this was the worst in years, but hardly the worst in history – just more people there now to be flooded out.The very next week there was a big brush fire (dubbed: The La Tuna Fire) in Southern California, in LA County near Burbank and Glendale CA. It burned around 7,000 plus acres. He told us it was the biggest fire in LA County history – he looked straight into the TV cameras with a straight face and told a bold-face lie. It wasn’t anywhere near the worst wildfire, brush fire, or the most property damage or costly for that matter. Not even close.For instance from September 28 to October 6, 2005 the Topanga Fire burned 24,175 acres; or the Station Fire from August 26 2009 to October 16 2009 which burned 160,577 acres and we lost 209 structures and there were 2 fatalities. The Springs Fire which started in Ventura County which stated on May 2, 2013 burned 24,000 acres of which about 8,000-plus acres were in LA County.And, mind you these are fires aren’t that long ago, in fact, there are still brush burn scares on the trails – you can see when you go hiking, burned-out brush will still smear charcoal on your legs when you run against it, trust me, I am an avid trail runner and come back often with black stripes on my legs from fires nearly a decade ago. Indeed, in the La Tuna Fire, the Firefighters actually got a rain storm that significantly knocked the fire down and it was put out completely rather quickly in short order.Why all the fake news? I believe it is so politicians can claim “devastation” to drive more Federal and State monies to the area from Emergency Disaster Relief Funds. So they can trigger more support from the Federal Government to pay for aerial fire tanker support, and to aggrandize themselves as they run for Governor, or attempt to be re-elected Mayor. Regardless of why, they know they aren’t telling the truth and think “we” the citizens are so stupid and have such short memories that we don’t know the difference or that we might be fooled because the media keeps repeating the lie.”Where are the Fact Checkers?” I dare to ask? Why do Fire Chiefs, Police Chiefs, Public Work Administrators stand side-by-side with these politicians and stay silent, they know the truth, it’s taken decades for them to become department heads – could it be that they became department heads by going with the flow and living the lie in trade for high paid jobs, pensions, and benefits? Scary thought, especially considering this trend.