the Laughing Boomer

Hi: 

Well, further to my post a few days ago, I recommend you open a bank account within the Global ATM Alliance.  The primary reason for this is that when you withdraw money from any of these banks around the world you will not be charged an ATM fee. This can potentially save you quite a bit of money, especially if you are travelling a long time.

Hi: 

It seems to be common wisdom that, these days, the best way to travel and pay for your vacation is to use your credit cards.  Traveler's Cheques are not well used nowadays, and you can always get cash in the local currency by going to an ATM.

What many people do not realize is that the foreign exchange rates vary with credit cards.  Some charge a transaction fee of 1 to 3 percent.  Others charge a premium on the conversion rate, while still others do both.

Hi:

 Well, with Bear Stearns selling for a bargain-basement $2.00 a share, and the Feds lowering the prime rate in the US by a full point this week, a couple of things become clear. 

 With the market doing its roller-coaster up 300 points, down 400 points and the foreign overnight markets not faring much better, the message is: be diversified.  Asset allocation is paramount, especially if you are retired and don't have ways to earn more income.  Real estate, bonds, T-bills, and shares in a variety of industries have to be the way to go. 

The shaky markets of the past couple of weeks are a bit scary.  Everyone seems to be blaming the U.S. sub-prime market, which has seen major drops in house prices, lots of unsold inventory, public house construction companies declaring bankruptcy, and people walking away from their homes.  With up to 120% mortgages, people have lived high off the hog for the past few years.

Well, as you know, you can make money from stocks, which fluctuate in price, and create capital appreciation, or in bonds or fixed money instruments. These instruments provide a fixed yield by either being available at a discount price which matures at par or are sold as  bonds or GICs, at say 5% which creates greater capital. 

Hi:

Well, many baby-boomers are in the throes of dis-accumulation.  Summer seems a perfect time for this activity as you can rummage through your garage, basement and attic and get rid of stuff through garage sales or trips to the dump.  You need to start this early, as it is time-consuming and sometimes emotional.  Lots of little decisions along the way which cumulates in clarifying your goals.  If you are not going to camp again, and make that decision, it's easy to let go.

Hi:

A couple of ideas around retirement based on people's attitudes towards this looming event.

1. Do not be paralysed by fear and so do nothing.  If you believe what the newspapers and other news media tell you, you might think you may never retire.  Realistically look at your lifestyle and how much money you spend. Then look at taking one of the variables away from that equation, generally your accommodation expenses, and see how little it really takes to live if all you need to buy is food. If you live somewhere reasonably warm, you might live quite inexpensively.

Hi:

You probably read them all the time.  I just received two reports this morning, one very negative saying boomers will not have enough money to retire.  Boomers are unrealistic as to the amount of money they need, says the report, and will need to keep working for several more years.

Another report paints a different picture, saying boomers are optimistic about retiring.  Thirty-four hundred were interviewed, and most are looking forward to their freetirement.

Hi:

People who have a lot of money have often worked very hard to get it.  They scrimped and saved when they were younger and finally, through a series of good decisions and hard work, are relatively well-off.

Some of these people still have the poverty mentality.  Unfortunately, they may have millions, but they live like cheapskates.  They may not pay for services they need and are always looking for a good deal.  Their old habit of saving money may have been useful in the past, but may need to be reconsidered now.

Hi:

Many people in government-type jobs such as teachers, public utilities,  and government workers at all levels have a defined pension plan. That means they will get a specified amount for the rest of their life when they retire. Although that amount may be indexed and go up, it will not fall below the defined amount.