Securities Demystified

When learning about investing, people hear a lot of terms. It is easy to get confused. When discussing securities, you’re basically just talking about things you already know but haven’t realized it. Equities fall into two basic categories and combine to make a third category. The following is a brief overview of these categories and if you’re interested in actually investing, you should talk to someone with tax trader status. It’s important you get advice before putting any money into any form of investment.

Equity Securities

Equity securities refer mostly to stocks: publicly traded shares of ownership of a company, partnership, or trust. The investor makes money from selling the shares at a higher price, also known as capital gains, or by receiving a dividend from the entity issuing the shares. Dividends are a portion of the entity’s profits spread out amongst the shareholders.

In short, equity means profit, so buying equity security means you have a way to make a profit from the investment. Be aware of any profit made from investing in equity securities, because they can be subject to taxation, even dividends. This is called a capital gains tax, and it can be anywhere from 0%, 15% or even 20% depending on income and filing status. Make sure you get help when preparing your income tax return in order to avoid having a high tax bill because you made a mistake somewhere.

Debt Securities

Debt securities mainly refer to bonds. This doesn’t mean you go into debt investing in these, not unless the entity issuing the bond goes out of business. No, it refers to the fact the entity issuing the bond goes into debt issuing the bond. They are using the bonds as a way to raise money, and when the bond comes due, they owe you the money you loaned them plus interest. Bonds are safer than stocks, but only if the entity remains solvent over the life of the bond.

Hybrid Securities

Hybrid securities are a combination of both stocks and bonds. An example of a hybrid equity security is an equity warrant. These allow shareholders to buy shares at a special price during a specific time such as a limited time sale on shares.

An example of a hybrid debt security is a convertible bond. These are bonds that can be turned into shares in the issuing entity. Entities will issue convertible bonds when their money is tight but their stock is on the rise. The bonds are converted into common stock shares in the hopes the price of the stocks they are converted into will be higher than the market price of the stocks thus encouraging the holder to sell. This then greatly reduces the entity’s debt.

Five Ways to Invest for Retirement is a great article to read about the basics of investing if you want to do further research on the topic of investing in general. The author, and the site, both have a lot of useful information about investing, and not just in securities.

To learn more about securities and the market they are traded in, Investopedia.com explains more about the SEC, the Securities and Exchange Commission.

The information above is just a trio of the types of securities you can invest in. There are more, far more, but these are the best ones for the beginner. They will help you get a toe wet in the ocean of investing and get some experience to keep you from drowning. Securities trading and investing isn’t something to be scared of. They are just another vehicle to make money for retirement, or anything else you need money for and have time to save.

This article is only intended to inform, not to advise. Investing is not a sure-fire way to make money, and everyone has their own reason for wanting to invest. Knowing how much you have and how much risk you want to take, along with having more than a passing idea of what investing entails, will go a long way in helping you make wise decisions about what to do with your money.

Power of Attorney in Estate Planning: Why It Matters

handd holding a pen and signing paperwork

What is Power of Attorney?

The power of attorney is a powerful tool that can impact the lives of yourself, friends, and family long after the principal is deceased. “Power of attorney over a person, who is known as the principal, is most often utilized when the individual handing over power has concerns about their ability to make legal decisions for themselves,” says the Attorney Referral Service by the San Francisco bar association, which can help potential agents (or those who possess power of attorney) claim power of attorney in California.

The power of attorney is not only useful in legal or financial situations involving a deceased person’s estate. Any time you need someone to act in legal matters on your behalf, you can bestow upon them power of attorney to handle your affairs.

You can assign power of attorney for the duration of a short business deal or after a specific future event comes to pass. Some people assign power of attorney for matters of convenience in business, but it is most often used in wills to designate an agent in case of debilitation or death on the part of the principal.

For Your Parents

Having a conversation with your parents about their deaths is not easy business. However, it is a necessary evil we must all eventually go through, and it is better to get it out of the way when your parents are still of sound mind and body.

Encouraging your parents to draft a will or estate plan is in their best interests as well as yours. This becomes especially prudent if you or your parents have a lot of siblings. Estate planning is a great way to ensure that your parent’s friends and loved ones will not be distracted by petty disagreements or confusion after the principal’s death and can focus on mourning properly.

Sit down with your siblings, parents, and any other interested parties to hash out who should be preemptively assigned power of attorney.

For Yourself and Your Children

If one of your children or a third party contests your will after death, your family could be in for a drawn out and painful process. The contestation of a will can lead to more than hurt feelings between loved ones: your last wishes may not be met.

To avoid sowing conflict between family members, you can preemptively assign power of attorney. This itself may lead to hurt feelings, if one child or sibling feels as though they would better serve as the executor of your estate. But it is better to hurt feelings now, when you are alive, than to subject your mourning loved ones later to even more grief and heartache.

Take a hard look at your children, siblings, and spouse. Who has the best understanding of your desires for your assets post-mortem? What does the divestment of your state look like to you? It is important not only to choose someone who has a thorough knowledge of your value system, but also who is fair and balanced in their treatment of others. You want an agent who can navigate strong feelings and who will not take things too personally when things inevitably get heated in the divestment process.

How to Choose an Agent

The nature of being an agent with power of attorney necessitates an even keeled and fair judgment. When choosing an agent for yourself, you should look for someone who has a thorough understanding of what you would like done with your assets after death or debilitation. You want to take care that your agent is committed to the full realization of your wishes after your demise.

If you believe you are a good fit to be an agent for a principal, make your intentions known during the estate planning process. Demonstrate that you have a thorough understanding of the principal’s values and communicate how you would handle any disputes which may arise between family or friends during the execution of the estate.

Choosing an agent to receive power of attorney goes beyond planning for one’s death. If you have health issues or would just like to prepare for any worst-case scenario imaginable, consider a durable power of attorney over a general power of attorney. A durable power of attorney will retain legal standing in the case of your incapacitation, whereas a general power of attorney’s purview ends the moment you become incapacitated.

If you get sick or are otherwise injured and need someone to act on your behalf, it is prudent to assign a durable power of attorney to a trusted individual.

Investing in Times of Volatility: A Look at P2P Lending

stock market

2020 has brought on its fair share of volatility, as was evident with the coronavirus stock market crash in March, where the S&P 500 index fell by more than 30% after reaching record highs just the month before. This is a harsh reminder of just how volatile the stocks and shares market can be at times.

If you?re looking to diversify your portfolio with alternative investments that are less prone to volatility, P2P lending could be a viable alternative to add to your list of choices.

stock market

How Does P2P Lending Work?

Peer to Peer platforms offer quick, personal and accessible loans to individuals and business owners through an online platform. Additionally, P2P investors in the UK can make tax-free returns* on their investment as a result of the government?s IF-ISA arrangement.

This arrangement allows investors to invest up to ?20,000 within a tax year, without having to pay capital gains tax on returns accumulated during the course of this period.

A Viable Alternative in Volatile Times

Peer to Peer lending is a viable investment alternative in volatile times.  Look at how it performs relative to market volatility, as well as considering its direct involvement with the property market.

Providers continue to mitigate investor risk by maintaining high levels of due diligence on new loan approvals*. They also provide additional support for borrowers who may be struggling to meet payment deadlines.

P2P Investments and Volatility

P2P investments are less prone to volatility as a result of borrowers needing to service their loans regularly*. While the coronavirus pandemic may mean that payments are delayed, this won?t necessarily have a bearing on the investors? payout at the end of the day*. The same can?t be said for all types of investments.

Investments Secured by Property

P2P lending allows for investment into loans that are secured by property. If the borrower defaults, it will only take a few months for the P2P platform to sell the property in order to recover costs*.

Finding a provider that holds first legal charges (meaning they are first in line to take control of the property in case of a default) is a great way to get additional peace of mind**.

property market

Increased Support for the Property Market

It?s also useful to note that support for the general property market has remained steady, even amidst the pandemic.

The FCA has announced a three-month payment holiday for homeowners and landlords. The Bank of England has also cut its interest rates for mortgages to a historic low of 0.1%pa, providing additional short-term relief.

Stringent Credit Committees

P2P lending platforms have stringent credit committees to vet each loan before it is approved.  Platforms are covering all bases before approving new business loans to ensure that they are viable. This is another means of increasing investor confidence.

Additional Support for Borrowers

Peer to Peer platforms tend to offer a more personalised service than banks, working with borrowers to help them find suitable solutions in unpredictable times.

Additional support is typically available through the Collections team of any provider – they can help find an appropriate solution in case a borrower is struggling to meet payment deadlines***.

investment

Getting Curious About Other Investment Types

In times of uncertainty, and especially with the increased volatility of the stocks and shares market during the coronavirus pandemic, investors have a responsibility to get more curious about finding alternative options to continue growing and diversifying their portfolios.

As the key factors in this article suggest, P2P lending is one of the prospects worth keeping in mind during your decision making process.

*Capital is at risk.  HMRC Rules Apply. 

**Securing investments against UK property does not guarantee that your investments will be repaid and returns may be delayed.

***Failure to meet the repayment criteria of a loan could result in the security being repossessed

Military Cost Cutters App Review- Money-Saving App for Veterans

Due to health conditions like Post-traumatic stress disorder (PTSD), and Anxiety disorder, many war veterans in the United States are going through a tough time. Not to mention, other post-war symptoms like disability, substance abuse and weakening of relationships.

Nine percent of the overall veteran population in the U.S is homeless, says a report by the United States Interagency Council on Homelessness. Military Cost Cutters is an app that connects veteran-owned businesses and customers with a military background and vice versa.

About the Creator of Military Cost Cutters

This app was created in the year 2012 by a Marine Corps veteran Aaron Serrano. Erin is based in Davenport, Iowa and wishes to do his best to help out his brother and sisters who need some financial assistance. He created this app with the sole purpose to improve the sales of military-friendly businesses by connecting them with ex-soldiers in the same region.

How Does the Military Cost Cutters App Work?

military app

To start making a truckload of savings this year, sign up with the Military Cost Cutter by clicking on the Sign-up button at the top of the screen, refer to the image above. It takes about 30 seconds to fill out all your information. Don?t worry, they won?t be asking you any sensitive or personal information. Just your name, location, and phone number. Next, download the free smartphone app from the relevant marketplace. It?s available for both Android and iOS devices.

Once you are done with the sign-up process, you now can move to the important part. To find the best deals in the town, enter your city name or let the GPS locate you. You will get lost of all military friendly businesses offering you services that you queried for. Next, when checking out, you do need to verify your identity by scanning your ID card. Make sure you capture the headshot. That?s it. Now you can visit the store and claim your discounted products/services.

What I Like About Military Cost Cutters App

For a war veteran, it is essential that they are respected and adored everywhere they go. It is rare for people to recognize the work that soldiers do. Hence, visiting a military-friendly business makes a war veteran feel like home.

Secondly, there are several merchants offering massive discounts for war veterans but there is no way to find out which merchant to visit. Usually, vets are forced to ask the merchants for a discount. Which can be a bit embarrassing. This app solves this particular problem. 

What I Don’t Like About Military Cost Cutters App

There?s not much to dislike about this app but they do not have discount stores in the Southern part of the country. Most of the discount stores seem to be present in the Northern US. Also, some veterans face problems while creating accounts. The app doesn?t pick up its exact location via GPS.

My Recommendation

I recommend Military Cost Cutters App to army veterans who wish to save some money on groceries, clothes, and necessary things of daily living. Depending on the product or service you are looking for, you can expect discounts of up to 50 percent.

Pricing

Military Cost Cutters App is completely free. You can download the Android app by clicking here and the iOS app by clicking here.

LoungeBuddy App Review- Save Money on Airport Lounge

loungebuddy app

Have you ever thought about what you would do if you have a few hours of layover at the airport? 

Most travelers do not think that in-transit accommodation is as important as picking the right hotel or a hostel. International airports are almost always busy and crowded with passengers and their family members. It is not a place where you would want to spend a few hours while switching from one flight to another. This is where airport lounges come in the picture. An airport lounge is a place where you can relax, have some food, get some work done, take a warm shower, etc. LoungeBuddy helps you find the most affordable lounge.?

loungebuddy app

About the Creator of LoungeBuddy

LoungeBuddy is a San Fransisco-based travel startup now acquired by American Express. In 2019, LoungeBuddy was American Express?s second acquisition. This company was founded in the year 2013 by Brent Griffith, Tyler Dikman, and Zac Altman.

How Does the LoungeBuddy App Work?

There used to be a time when airport lounges were meant only for the business class travelers. Only the ones who are willing to spend top dollar were given access to this area. However, since it?s the arrival in the market, LoungeBuddy has changed the dynamics of airport lounges. Now anybody can download the LoungeBuddy app and get access to an airport lounge by paying a small one time fee. 

LoungeBuddy has also introduced Single Use Lounge Pass for those who do not travel very often and headed out for a single return trip. To find an airport lounge, you need to search for the airport you are planning to layover at. You can also search for your departure airport if you have reached the airport early. LoungeBuddy will show you a list of Lounges. Pick anyone and make the payment.?

Next, when you arrive at the airport, locate the relevant airport lounge with the help of an airport staff member. Once you reach the lounge, tap open the LoungeBuddy app and open the QR code provided to you after the purchase. Show it to the front desk staff and enter the lounge without paying anything additionally. You can enjoy all the premium amenities like shower, washrooms, a comfortable seat, etc.  

What I Like About LoungeBuddy App 

I like that most airport lounges listed under LoungeBuddy have the facility to of Flight Monitors. Once you enter the lounge, you don?t have to worry about keeping an eye on your flight timings. The staff members at the lounge will notify you well before the flight arrives. 

What I Don’t Like About LoungeBuddy App 

The fee you pay to LoungeBuddy does not include food or a private room. The app only gets me in. I have to pay for food, coffee, and other pleasantries. This is the only downside of this app. 

My Recommendation

I recommend this app to business travelers and digital nomads who travel on a regular basis. Even a one-time traveler can purchase Single Use Pass for a few bucks. 

Pricing

The lowest price for airport lounge access worldwide is $25. Unfortunately, the LoungeBuddy app is only available for iOS devices. Android phone uses can use the web version of LoungeBuddy.