showed she genius of james madison. this is what washington is supposed to be. this is how we're supposed to work, and found out, when the president and congress hated each other it actually worked better because all of his garbage projects, we struck out of the bills. all of our pork barrel projects he struck out, and it's the creative friction that the founding fathers understood would make america great. >> host: if barack obama is a fortunate man but if he were more fortunate he would have a republican congress. they would temper him domestically, he would be reasonable been his foreign policy and good things would follow. >> guest: george w. bush would have been a much better president with a democratic congress over eight years balancing him. >> host: all right. that was a great interview. thanks, joe, very much.

>> guest: thank you. >> alan roth takes us through teaching his child how to be a wise instant vestor. this event is about an hour. >> now, tonight you will hear from an author whose book just came out in march. his work is already receiving great interest, locally it was reviewed by the colorado springs business journal and the colorado springs gazette. nationally, it was reviewed by the new york times a few weeks ago. for those who follow reader ratings online, it had the maximum five stars on amazon.com. and as if that weren't enough, allan and his son kevin were interviewed on fox tv's good day, colorado. you can see that interview and the video on the book on

youtube. they're now youtube stars. they were also jointly interviewed for npr's marketplace morning report. our guest this evening is allan roth, author of how a second greater beats wall street. golden rules any investor can learn. when his son kevin was in kindergarten he set a goal of teaching him how to build an investment portfolio bit the time he was in second grade. while it didn't surprise him when eight-year-old kevin did so well, what did surprise me, he says, was the large advantageses that a kid has over an adult when it comes to investing. in his book roth imparts some simple lessons learned from kevin. his chapter titles give you some sense of how approaching this

with a child's eye view and a sense of humor helps to keep things, even the world of wall street in perspective. chapter nine is, don't bet your lunch money. chapter six invoke as child's healthy skepticism with the title, if dad says there's a better way, i might try it but i'm not so sure. and the infamous chapter three is, i like spongebob. allan roth is the founder of wealth logic, a financial planning and investing advisory form. his expertise in portfolio construction and performance benchmarking and is frequently quoted in the financial media. he is an adjunct finance faculty member at the university of

colorado at colorado springs and colorado college. he also teaches behavioral finance at the university of denver's graduate text institute. roth is a certified public accountant and a certified financial planner. with an mba from the prestigious kellogg could go at northwestern university. he has held the position of finance officer for multibillion dollar companies and has been a consultant at mckenzie and company. he writes for the cost springs business journal and has written articles for money magazine. his web site and his book jacket point out that, despite these credentials, he claims he can still keep investing simple. please help me welcome, allan roth. [applause] >> thank you very much, paulla. that was a lot to live up to.

i'm thrilled to be here. thank you again for having me. paula mentioned i'm a licensed certified public accountantment i don't practice anymore but i'm still licensed. so what i'm going to talk about today is going to be feelings. a cpa talking about feelings may get kind of awkward. [laughter] >> so bear with me. investing in the stock market has been pure agony lately. now, grant, the last month the market has come back the fastest bull market since 1938. and i'm going to try to convince you guys later on not to forget the agony. the bottom line is, if we remember the agony in 2002, the first time our 401ks became 201(k)s, we may not have boldly invested in the stock

market like we did in 2007. the last ten years the s&p 500 index is down 26.5%. professional portfolios like bill miller, whose value trust fund has the longest track record of beating the s &p500, lost 2 percent. and in the last month the market has just about 1% down right now. many say that the great depression is next. in fact, the same person that said the dow is going 40,000 three years ago now predicts the great depression. but somehow, even though the last ten years have brought the two of the four worst bear markets in the history of the u.s. symptom -- stock market,

all in the last ten years, simple version of the moderate second grader portfolio somehow earned 36% gains. certainly not spectacular, but beat the professionals and beat the benchmark that wall street loves to call the stock market, the s&p 500 index. now, i know i'm not supposed to give away what is this portfolio. it's simply a total u.s. stock market fund that owns thousands of u.s. stocks, a total international index fund that owns thousands of international stocks. and a total bond fund which owns all investment grade and u.s. government bonds. so, how did the simple portfolio

beat wall street? beat all the experts? slaughter bill mill center the answer is, simplicity. stop doing what any second-grader will tell you is a dumb thing. so we're going to go over ten of these dumb things and the simple golden rules to try to prevent ourself from doing it. dumb thing number one. by second grade, kevin learned it's better to buy things when they're on sale. you can buy more of it. duh, as he would say. yet, we adults. if you look at the stock market since 1996 to recently, we had more money going into stock market mutual funds, guess when?

2002, 2007, at the very height. when was more money pouring out? 2002 and just recently. money means too much to us adults and that causes us to do some really dumb things that we learned by second grade we shouldn't do. boldly go where everyone has gone before when the mark is up, and than panic and sell in times like these. we can't predict what the market can do but we can predict human behavior as totally irrational. now, the analogy i make in the book is macy's having a sale where the double the price and people line up to buy, and then they have a half off sale and everyone returns its. i'm going to see if anyone has the domain double the price.com. i can get rich.

unfortunately with the web there's no -- somewin will come up with triple the price.com. we really do act dumb when its comes to investing. i used to think we couldn't time the market, but it ended up we are really, really good at timing the market really, really poorly. the second dumb thing we do is forget simple arithmetic. now, if i needed heart surgery i would not go to the cheapest heart surgeon. but my heart surgeon wouldn't need to make somebody else sick in order to make me better. when it comes to the stock market, roughly 90% is professionally managed. so we pay one expert an average of 2% to try to outsmart another expert. something that doesn't make a whole lot of sense, and later on in this presentation i'm going

to show you the odds of that game. that's a game that kevin won't play. now, if your don't believe the logic of this, this is some research i did for a column in the business journal and for the book, where i looked at the largest 20 mutual fund families. and then i looked at their average morning star rating. morning star is a great service that ranks these mutual funds on performance with five star being the best, and one star being the worst. so, i regressed their stated expense ratio, which is only part of the expenses, bill the way. there are other hidden fees as well -- against their rating, and each of these dollar signs represents one of the fund families. and just in indication you didn't see a pattern i drew a really heavy line here just in case you didn't see the line. i made the conclusion on the top

as costs increase, guess what? performance decreases. the more you pay your expert, the less you're likely to get. why do these funds over here exist? one word. marketing. adults put too many eggs in one basket. i brought out a globe and sat it on the table. i spun it around, and i asked kevin, which country will have the next hot stock market? he looked at me puzzled and said, i don't know. and guess what? that was the exact right answer. but we adults, we're too smart. we have to put all of our eggs

in whatever country, whatever sector happens to be the hottest. guess where more money was pouring in 2006 and 2007? in mutual funds and what are known at exchange traded funds. international, specifically emerging markets, more specifically, india and china. now, are the economies of india and china going to grow faster than the u.s.? yes. is there a human being on this planet that doesn't already know this? i don't think. so i haven't found one. so we put our money there right after it's gone up 6-700% just in time to see it lose two-thirds. guess what we will do next? take it out of there and put it into gold. well, whatever does well in the next year.

now, adults just follow the herd. has anyone ever opened up the newspaper and seen a morning star one star mutual fund advertised? [laughter] >> please let me see it if you have. morning star assures me that there are just as many one-star mutual funds as there are five star. so, we open the paper, we see an ad, we find a five-star mutual fund, we put our money in there and guess what happens? doesn't do so well going forward. so here's a better strategy. put your money in allan rot performance chasing fund. we span the globe chase what is

hot and dumping what is not so you don't have to. we have performed this five nears in a row. our time is coming. the past performance is not indicative of future performance, at least i sure hope so. the first time that diskramer has ever been given with the hope that it didn't. the next thing that we do is we're so busy trying to figure out what the market's going to do, let's what's going to be the next hot market, that we forget about low-hanging fruit, low-hanging fruits are easy pickings, things we can do to increase our return no matter what the market does. so many clients come to me with a lot of money in a mutual -- amoney marked mutual fund earning nothing or 0.9%. at least put it in a money market fund earning 2-2.35%, or

they have their bonds earning 4% and they have a mortgage of 5.5%. pay off the mortgage. i can't do that because the mortgage is tax deticket able. don't forget your paying taxes on the bonds as well. credit cards, 15%. pay off the credit cards. expensive index funds. at least inexpensive mutual fund strategy are going to have a 1% chance of working or hiring a spratly managed account but anens and if index fund. an index fund is a fund that owns the entire market so the expense since index fun has a zero chance of being the less expensive fund. why do they exist? marketing. yeah. marketing, advertising. so, pick the low-hanging fruit.

next is don't lend money to someone who can't pay you back. does that sound obvious? how did we get into this global crisis? by making loans to people that had -- what were they, ninja loans? no income, no job? who says the u.s. doesn't export anything. we expected all this subprime derivative garbage globally. now there was a kid in kevin's class. we called him randy there was no such mid his class. he was always borrowing things and never returning. i asked ken e kevin, would he lend money to him elm. his answer was no what if he paid a higher rate? his answer was no. wall street, different story, different answer. what a lot of people did.

the stock market was horrible last year. but a total bond index fund did its job. when the u.s. market lost 37% of its value, the bond index fund gained 5.2%. it acted as shock ash -- absorber. i had so many people come with safe bond funds and money market funds like this swab must fund that was billed as a safeman market. look how stable it was. guess what was behind all of this safe money? triple-a rated-insured, subprime garbage. so, never forget the rule of the fixed income portion of you're portfolio. if it lost money last year, it didn't do its job.

another thing we do that paula mentioned, we bet our lunch money. we did an imaginary scenario to kevin where we gave him enough money to buy his often and i offed to get it back. i said there's a 75% chance you can double your money and a 25% chance you can lose it. would you take that sunset well, he asked, what happens a if i lose? i don't get lunch. he didn't make that bet. us adults, we bet money we needed in the next five years, thinking the stock market isn't risky because it gave is five years in reof stead areurn. so a lot of adults bet our lunch money in the stock market. anyone ever taken one of those 43 question, risk profiles?

and it says you should be 73.289% in stocks, you know, precision. anyone believe that they would fill that -- come out with the same result today? if they took that same survey as they did two years snag the way we feel about risk is not stable. all right. now, we were making fun of kramer long before jon stewart did. he just made it more popular. and i have been told this borders on child abuse, but for ten minutes i made kevin watch kramer's mad money. he heard the bells, the whistles, the screaming. and he thought it was a joke. i tried to explain to him, that millions of investors watch him, follow him, and take his advice.

i think only today, because he heard me give a few of these presentations -- he has bronchitis today and couldn't be here but he actually believes this is true. so, adults, we watch too much financial tv. now, it may not be as animated as kramer but we will watch cnbc in the morning thinking we're get something real insights and we know what the mark is going to do in the next two hours. so, again, this is just for the record, we were comparing kramer to spongebob in the book, one is a real cartoon, the other is a human cartoon, and i did make a public apology on youtube for that analogy of comparing

spongebob to kramer. so i apologized to spongebob and all the creatures. so there's nothing simple at tacks and i'm not claiming there's anything simple about taxes. that kevin's heard me, others complain about having to pay taxes. but i told kevin, when it comes to investing, adults pay a lot of taxes needlessly. by turning portfolios that causes taxes, by putting out of our assets exactly in the opposite place, and i will get into that, where stocks belong versus where bonds belong in a tax-deferred verse a taxable portfolio. so we love to complain about tacks and we secretly love to pay them.

kevin knows not to play a game, an important game, if he doesn't understand the rules. anyone ever be handed a document like this? or thicker? and then be handed a one-page thing that says, you read and completely understand everything in this document? i'm here to tell you -- and these documents are often insurance documents. insurance investments. i'm here to tell you, i have never found a client that understood it, i have never found a financial planner, aka insurance agent, that understood it. and sometimes i get the fun of dealing with the legal

department of those insurance company, and i never found a lawyer that understood one of those documents. so, we play games we don't understand with our nest egg. and then finally, -- and i'm guilty of this as well -- love to overcomplicate things. everytime i violate the kiss principle, keep it simple, stupid, i usually regreat it. 43 fund diversified portfolio. you'll see with three to five funds you can build a diversified portfolio that i can guarantee you will be less diversified. sophisticated market models,

bathes technical analysis, that's completely worthless. my favorite, market newsletters. mark hole -- holbert did a studdie. he follows newsletters. in 1982 if you had taken $10,000 and invested it in whatever was the hot nest the news letter, do you know how much you would have today? two cents. think about how gullible people are. if i knew how to beat the market, would i write a newsletter and try to peddle it across the country for $199 a year? no. i reside sell it to an institution and make billions of dollars. so we love to overcomplicate

things, and these are dumb things we do that cost us dearly when it comes to investing. so, what should we do? rather than just leave you with, here are the dumb things we do -- by the way, just in the last three weeks, cbs money watch as opposed to market watch, has launch add new web site where i'm writing a column called "the irrational investor" and it's about these dumb things we all do. and how to, guess what, stop doing them. so, number one, never forget the arithmetic. do you guys remember six months ago when gas was at $4 a gallon? how did you feel as you were pumping up the car and seeing

those digits add up at lightning speed? i'm a cpa, i'm really good at describing my feelings. i felt bad. [laughter] >> really bad. how is that? now, -- by the way, what were the expects saying? what was it going going to be by the end of the year? $10 a gallon. then it fell to $3 a gal, and the expert said it's going to be $1 a gallon. we're really good at predicting the past. now, i pointed out in the book, even when gas was that high, i bet you many of you in the audience are paying far more in unnecessary fees than you were for gasoline back then. why didn't it hurt so much? you didn't see it.

so, number one, you can certainly have a low-cost portfolio that isn't appropriate but you cannot have a high-cost portfolio that will work in the long run. number two, don't put all your eggs in one basket. own the world. a study was done not too long ago that showed the fastest growing economies. their stock markets lagged the rest of the world. the reason? everyone knew they were the fastest growing economies. the same reason why growth stocks tend to underperform to value stocks, the beaten up stocks, the ones that warren buffet goes for. who was greedy when others are fearful and fearful when others are greed y.

about three weeks ago, someone from cnbc called me and asked me if i watched kramer. my answer was, yes. but now for reasons you probably want to hear. kramer is great at going after people's emotions. it's like pro wrestling with this disclosure it's fake. so, my advice is if you watch financial tv, watch how they're trying to tug at your emotions and such, and how little data they give you. we have two sides of our brain, jason wrote, your money and your brain, he writes for the wall street journal now -- says we have two sides of the brain, one is reflective and one is reflexive. the reflexive is the --

reflective is the logical. the one that shays don't eat that chocolate cake, versus the reflexive whiches the human instinct that works so well. the fight or flight that says, chocolate cake, good. so market going up? good. got to get in market going down? bad. i'm losing my nest egg. want to panic and sell. ...

>> it did not work any more. my dad to i love dearly, he called me and told me i am a contrarian i am following the dogs of the dow. when you do something that everyone is doing are you a contrarian? or are you following the fad? it is easy to call ourselves contrarian but the only true way is to rebalance. when stocks go down you have to buy some more. when stocks go up, i guess what? you have to sell.

it goes against every human instinct. my wife patti you is in the audience kevin and i used to play board games. we used to have different methods to see you would go first broke i am with those guys you have to teach a life lesson you cannot always go first. usually lost that argument. [laughter] that kevin nunu matter what method we used the had a 1/3 chance of going first. i taught him some simple math what is the odds of going first twice in a row? he could multiplied three times three whether the odds of going first three times in a row? one of 27. a lot of people come to me and say why should i go with the index fund?

roughly one-third of mutual funds have the index fund i argue far more than one-third i did my research for the little book of common sense investing and i found that 42% of the inactive mutual fund or portfolio was separately managed account had a 42% chance but guess what? do you know, anyone who just owns one of the mutual fund or one portfolio 41 year? that is kind of like going to las vegas which of by the way. when i sit down of the table, my best chance of walking out ahead is to do what? play one hand and walk away. the longer set the table the more hands i place simultaneously, i am not a

card counter the worst might odds get. so if i have 10 mutual funds u.s., international, bonds, re al estate, over a when you period you have a 25% chance of winning. over a 25 year period has less than a 1% chance of winning pro to put it another way people play a game with their nest egg they have a 99% chance of losing. chapter six, if there is a better way i might try it. that means the something goes up something else may go down.

i explained to him that things like precious metals and mining stocks that have negative correlations but low correlations for the stock market so that if it correlates perhaps those funds could do well and and the blue is the first to bear market the first time the woodstock market lost 50% between 2000 and 2002 reit and precious metals did quite well. listed a different story it was a real estate bubble. i did not get kaman there and so far he has been right. so i will be stubborn and stick to my ways.

don't lend money to get someone who will pay you back never forget the purpose of the bond portfolio that is to act as a shock absorber. and so many people chased a little extra yield or 50 basis points. and ended up losing five or 10 or 21 fined came with a california municipal bond fund to use all sorts of exotic things and this is a big portion of your proof -- portfolio that she inherited and lost about 40 percent worse than the stock market broke it turns out people with bad credit cannot afford to buy a home. who knew? everybody knew that they thought real-estate can never go down in value.

with that said i do believe we can get some extra yield without taking a risk when you think of it firemen institution with billions of dollars to invest what do i have to invest in? a treasury bill yielding about o.5% but we can find the highest paying cds backed by the u.s. government for up to 200 your $2,000 temporarily for this year for a taxable account. or 200 to thousand dollars permanently for the i.r.a. accounts. that could be paying 3%. that does not sound like much but get real.

do remember what cds repaying in 1981? somewhere as high as 15%. if 1/3 renter tax is you got a 10%. what was inflation? about 13%. so the real spending power drops by about 3%. today if you can get 3% on a cd you can actually do better part of you get 2% after taxes and inflation is at zero, we get a positive 2% return. these are good good old days. one of my columns coming up is about cds hitting all-time high rates and in real terms that is exactly what is going on.

do not bad your lunch money the money that you need in the next five years has always been too risky to put in the market. again we have five nice and steady years between 2002 and 2007 where we got gains each year and we became used to it. the market has always been risky. still pay taxes if you don't have to. this is more of a technical discussion in the book but where relocate assets one to pick the asset allocation if you want to be 60 percent stocks are 40% bond replays those assets is incredibly important.

tax funds belong in your taxable account those at the highest rate me long in your tax-deferred account. that is the low hanging fruit whether the market is up or down or sideways the return will be higher. if the game is too hard to understand i will not play. keep it simple the way most people invest it is a mental model of a boat designed like this. it is ground. if i higher more people to grow or stronger gasol will happen? we will go encircles a lot faster paying one expert more money to outsmart the other expert is not going to work.

person is the simple portfolio that just keeps working has nothing to do with the efficient market hypothesis but has everything to do with simple second grader arithmetic that you must be to wall street whether the market goes up or down, every year come every month, every day, don't forget the low hanging fruit. albert einstein said that come pounding was the most powerful force in the universe and i would like to nominate inertia. as the second most powerful. we just leave the discounts earning lower amounts maybe we should pay off the mortgage but we never get around to them. pick fellow hanging fruit. number 13, i have a lot of

people come to me and say your approach is to sample. i am more sophisticated. a couple of people here thought that simplicity is fairly smart and they are a couple of relatively smart people with sir isaac newton and albert einstein. both moot lost a fortune in the stock market. [laughter] albert einstein took the money he won from the nobel prize and invested in today what would be known as junk bonds. he was ahead of his time and sir isaac newton was involved in the scandal that was a bubble that he lost a fortune on.

the secret to investing is simplicity and the book goes through the basics second grader fund the advanced second grader portfolio and then the alternative which is active and by the way i call the cd strategy the active strategy i have abandoned, in large part indexing when it comes to bonds by trying to find to the highest paying cds. then aware relocate the accounts is incredibly important on a tax-deferred versus a taxable account. this is a lot of data but basically the second grader portfolio i am arguing is right for anyone. aggressive maybe 60% u.s. stocks, 30% international, 10% bonds. that is probably appropriate

for no one in this room. maybe a second grader. of moderates who would be 60% in the market and conservative 20% in the markets or 30%. and again where you locate those funds is incredibly important because it is not just your willingness to take risk buy you need to prepare a lot of people whose objective appears to be dying the richest person in the graveyard. but is not our goal. 1% seems like a very low number. but let me tell you every 1% you get of additional earnings in your portfolio means reaching your goal about four years sooner.

with the methods in this book, i am arguing is child's play to earn an extra 4% per year or more. by lowering costs, by getting tax inefficient vehicles out of your portfolio and only buying the tax efficient, controlling your emotion, even with the is low cost broad index funds, guess what? you can still get an at the height and panic and sell when it goes down and finally the tax location of your assets is very important for growth a 4% increase return can get you 16 years sooner to your goal or increasing the amount you can spend from your portfolio at a safe rate by about 75%, nearly

doubling what ups einstein was right when he said the power of compound and is the most powerful force in the universe. in conclusion investing is really simple. don't ever confuse simple with easy. cavan already had to play the stock market game. which is a game where you pick three stocks and see how they perform over the next 10 weeks. that teaches speculation. i told kevin he goes to school with a note to to his teachers saying he will not play that game. [laughter] my wife patty and i discussed it. guess what? he played the game. [laughter] but guess what?

i am thrilled to say he did very lousy. [laughter] if you do something like that and you do well then it the odd is beating the market is easy and i will do it. if you do poorly it is risky or i will pay an expert to do for me but either outcome i would argue is really bad. online and you can think of the message in this book as very simple but i will argue you have to be smart enough to not outsmart yourself which i have done many times. you wonder why i can describe these emotions so well is because it is me. remember the simple lessons we have all learned by second grade? it will serve us well when it comes to investing.

and my friend gave me a great quote saddam of simplicity is complexity resolve. my advice to you guys, kaman is in fifth grade, it is too late. [laughter] find an eight year-old and describe your whole investment strategy to them. and if they don't understand it, be scared. thank you very much i have really enjoyed this presentation and we're now going to take questions for brian sorry to make this so formal but if you could either come up to the microphone or they can bring the microphone to you. so please ask a question.

the last time i gave this there was an hour and half worth of questions. >> if you put this eighth part of your portfolio and a bond index fund to you expose a great portion to the foibles of the bond market as the housing bubble and the subprime mortgages and take a beating in the total bond fund? >> great question. the total bond market fund is roughly 74% u.s. government-backed securities. therefore it has a zero default risk because the government is the one entity that has a license to print dollars. it can do it legally. [laughter] just a rumor per car was not printing dollars it is just a vicious rumor by a competitor.

the other 26% our investment grade bonds. they should be a little worried because guess what? wachovia, lehman brothers, bear stearns were all investment grade about one 1/2 years ago. there is a little bit of risk and also other great alternatives i talked about in a book such as treasury inflation protected securities , they ginnie mae is a great bond fund you can keep costs low even though with stands for mortgage it is backed by the u.s. government and those are all bonds that it did either very, very well or did not do quite as well last year. but you are exposing very little and i do think if you are willing to do the work, finding the highest paying cds it is a active

strategy is it of paying 3.5% and you don't watch your mail, this is what the bank will do one year later. their role of over two would ever be great they want to give you and your locked in an at another years you do have to actively manage that. thank you. >> when you talk about rebalancing your portfolio how often do you do that? if you do that often doesn't that increase your success ratio? >> how often? it is not a matter of time. it is a matter of how far it varies from your target. if you're going to stick 60 percent stocks stocks you got down 55 that is the time to rebalance. that is a mathematical answer.

but even a nerd like me i am not a mathematical animal, i will admit when the market was plummeting i was rebalancing over a slower pace. i would argue there is not much of a cost of rebalancing if you do it with a no-load mutual fund there are ways to do it more tax efficient way like doing it within your tax-deferred account and i am a believer i can talk about in the book of what i call a tax-loss harvesting but there are times that you want to sell just to harvest said tax-loss to use in the future. but there are ways student -- to do with

low-cost. >> what about the programs that you hear about on the radio or tv the safety net that guarantees 7% return with absolute no risk on the money you have invested? wouldn't that make more sense? >> absolutely would make more sense if i could have all of the upside of the market without any of the downside risk, my gosh i would do it and i would be preaching it and selling it but i have looked at so many of these prospectuses and they always have they got in there the 7% return is not a cash return it is the annuity of payments that the insurance company controls. they can give you $0.50 on the dollar. it is an illusion. guess what? do you think institutional

investors right now would go after something that guaranteed a 7% return plus the upside? i think morgan stanley and the city and bank of america would all be doing that. but you are really end up buying what i call a and and direct investment. lot of your money goes to the agent that sold the product, a lot of money goes to the insurance company, overhead, cost of the product and their profits to shareholders. what you get is a leftovers. a bond like return only much less than you could have gotten. if you find one, i have had a lot of people show me products that they have bought that have earned that and i have not seen a one. i will change my ways.

my wife says i can never admit i am wrong but that would be the first. >> i know you don't think the fund is good but what about something like to plunge years or consumer reports the financial advisory newsletter? do those have much value? >> i have not read those specifically do they recommend individual stocks? >> not specifically know it is more of a trend or what to watch out for or what to avoid. >> most the report on trends are predicting what has happened recent labor i cannot comment on those to because although at imi financial planner, i have not seen those

two letters. but if i came out with a newsletter it would say own the whole market, asset allocation location, rebalance, that would be issue #1. issue #2 wood pc issue #1. it would make such a boring news later even i would not subscribe. thank you. so many pension plans nowadays if you invest in a subcategory. how does one go about taking the some of categories based on the success ratio with a lot of hidden fees that you don't even see? >> are these pension plans or 401(k) defiant contribution?

the employer funds. >> 401(k) 403(b) 457. >> it is an ugly part of the industry. especially small companies offer 401(k) and the company gets it for practically nothing. the reason they get it for practically nothing is the fund within the 401(k) are all outrageously expensive funds. what i do for clients is help them pick the least bad and let them know when they leave that employer or a few are no longer would then you can roll over into and irate account

and have control to find the lower-cost like in the book "how a second grader beats wall street". i always tell people never ever miss out on the employer match. that is free money now employer matches are becoming less common. beyond that you may want to consider other strategies such as if you qualify tax wise to put additional contributions beyond the employer match into the i.r.a. account. some are so outrageously expensive they don't want the client to put any money in their above the client match. there are many good usually large companies tend to have very good for one k or 403b not-for-profit equivalence plans it is the employer that is small that tends to have the expensive plan.

perhaps you do not want any comment from the on politics there is really a person that knows less about politics but maybe we will have some reform in this area going forward. . .