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Investing In Bonds

Investing In Bonds

After Last Year, Is It Still Safe To Invest In Bonds?

Bonds are a good diversifier, when interest rates aren’t at record lows.

Parts of this article were originally published on MakinSenseBabe

Most financial advisors are wussies. They’re too afraid to ditch an old investment playbook that might not work going forward for the same reason we’re too afraid to ditch an old life script that might not be the best thing for us going forward. A script is when different parts of your life feel like variations on the same old story. Living by old scripts is easy, because it’s familiar and therefore comfortable. 

Like, if we’re used to dating people we know we could do better than, just because we’re more afraid of being alone. Or if we’re in a job or career that we don’t like, it’s more comfortable to stay in that job versus starting from scratch with something that may or may not pan out. 

Most people choose what they know and repeat behaviors that they know because the unknown frightens them. 

This is why people got sucker-punched with most of their bond fund investments in 2013. So now financial advisors are standing around scratching their balls trying to figure out if they need to rewrite the rules when it comes to bond investing and adapt to the new environment we’re in. Most are choosing not to. 

The truth is that it’s time to ditch the old bond investing playbook, and here’s why. First…

What Is A Bond?
Imagine you loan your money to the government for 10 years. And the government pays you 3% in interest payments per year for 10 years for that loan. You own a 10-year government bond. 

If you loan your money to a company for 10 years and they pay you 5% interest every year for 10 years, you own a 10-year corporate bond. 

If you own a bond, you gave out a loan and will receive interest in return. 

Why Did The Value Of Some Government Bonds Decrease By Over 10% In 2013? 
Imagine if you loaned your money to a friend for 10 years and they paid you 2% in interest each year. Then imagine the next day they went to another friend and borrowed money from them for 10 years as well. But that other friend said fine, “I will loan you that money, but you need to pay me 3% in interest each year, not 2%.” 

You’re now in a worse situation because that new 10-year loan or bond now pays 3% in interest and yours only pays you 2% in interest each year. 

That’s why, when interest rates go up, the value of existing bonds go down. That’s what happened in 2013. Interest rates hit record lows last year and then went up. 

There are three main assumptions about government bonds that worked over the last 30 years (up until 2013) that need the boot.

Old Bond Playbook vs. New Bond Playbook 

Old bond playbook — “Bonds are safe.” 
New bond playbook — Open your glove compartment. Bonds are about as safe as that melted condom. 

Everyone is used to saying “bonds are safe” because, yes, they have been for the last 30 years. As long as interest rates have been going down, you win on the value of your existing bonds because they’re now worth more since they pay a higher interest rate than the current rate. With interest rates hitting record lows, the opposite has been happening. Bonds aren’t safe. 

Old bond playbook — “Bonds are a good diversifier” 
New bond playbook — Bonds are a good diversifier, when interest rates aren’t at record lows.

Historically, when the stock market sells off, the government bond market rallies. That’s the normal relationship between stocks and government bonds. This is because there’s a “flight to safety” when people get scared in the stock market. They sell stock funds and buy government bond funds because historically, those bonds are safe. 

That relationship works best when interest rates are at average or high levels. So, not right now.

Old bond playbook — “Buy your age in bonds.” If you’re 35, you’d allocate 35% of your investment portfolio to bonds and the percentage would increase as you get older. 
New bond playbook — Tell that to your 65-year-old mom who just lost over 10% in her long-term government bond investments last year. 

Yes, the vast majority of retirees are currently screwed for this reason; they’re not left with many “safe” investment options for their age, given where we are in the interest rate cycle. Buying your age in bonds does not work right now, given interest rates are still well below their long-term average rates and will trend up over time. 

Here’s the bottom line: If you finished this article, congratulations, because, let’s be honest, finance topics are about as fun as watching Lincoln with a history buff. But now that you did, I hope that when you wake up tomorrow you think about a playbook that no longer works in your life and kick it to the curb — along with any other old scripts holding you back.

Kathryn Cicoletti is the founder of MakinSenseBabe, “The Money Site For Non-Finance People. Finance People Are Annoying.” We plow through news that impacts your money and make sense of the important stuff so you can get on with your life. We have no interest in making you a finance whiz, though. Finance whizzes are boring.

‘People inspire you, or they drain you. PICK THEM WISELY.’

Hans F. Hasen — ‘People inspire you, or they drain you. PICK THEM WISELY.’

Why The First Step To Succeeding In Anything Is Saying ‘Yes’

Read this and thought it was interesting , but funnily enough I just watched ‘Yes Man ‘ and it was the same kind of concept . Worth a try for some individuals .

Why The First Step To Succeeding In Anything Is Saying ‘Yes’


Money
Paul HudsonJan 18, 2014 – 1:36pm

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Every mark of success originates in the same way: answering a question with “yes.” We are presented with opportunities every single day. Whether or not we choose to accept those opportunities and act upon them is a different story. Most people will complain that they never get a break, that things never just fall into their lap, like they seem to for everyone else.

The thing is, nothing just “falls” into anyone’s lap. In order to encounter an opportunity, you must seek it out. There are two steps to attracting opportunities: The first step is to find and recognize an opportunity when one presents itself, and the second is to say “yes.” If you don’t say yes and take proactive action, you’ll never get anywhere in life.

Opportunities come in the form of persons. It’s not like your dream job will come knocking on your door; dreams don’t have fists. Only people can present you with opportunities. For this reason, we have to maximize the efficiency of our interactions with other people. You will need to meet new people because new people are much more likely to present you with opportunities than the people you come across on a regular basis.

Sure, the people you know may present you with opportunities from time to time, but the fastest way to stumble upon fresh opportunity is to expand your network. Before you go out and start introducing yourself to every person you meet — which may actually be quite fun — I recommend talking to the right people.

What makes someone the right person to approach depends on the type of opportunity you are looking for. If you are looking for a job in a certain field — say, the medical field — then you’d be best off going to places and events where you can mingle with doctors.

If you are looking for a relationship, go to places where you are most likely to find single people also looking to be in a relationship — Google it and you’ll find more than enough places to meet your future husband. Go to places that focus on the things you enjoy, like museums, bookstores, clothing stores, the park…

You are most likely to land the right opportunity going to places where you’re most likely to find good opportunities. Why do you think people go to Ivy League schools? It’s not for the education; it’s for the networking.

Recognizing an opportunity is not as simple as it sounds, unfortunately. It can be very difficult to figure out what is a great chance to make progress in your life or career and what is most likely a waste of time. It’s impossible to know what the future holds in any given circumstance, so trying to recognize an opportunity for what it is near impossible. The only thing you can do is give it your best guess. If you think something may lead to a great opportunity, then take the leap of faith and go after it. In order to do this, you have to do what many people find to be the most difficult step in finding opportunity: saying yes.

Opportunities aren’t so much found as they are created. You create the possibility for opportunity every time you say yes to a request. For example, I landed my job with Elite Daily because I said yes to a friend of mine when he asked me to go out for drinks. I ended up meeting a certain Mr. Cuffin, and then, a week later, I’m at the Elite Daily headquarters.

One year later and I’ve written several articles that have received hundreds of thousands of shares. Because I was given the opportunity to work with Elite, I was also able to introduce myself to the right people.

Now, I’m launching my own startup: lilHub. All of this opportunity presented itself and led to my success, only because I said yes. I said yes to something that did not present itself as an opportunity, at all; it was just a fun night out. If it weren’t for that one “yes,” you wouldn’t be reading this article and I wouldn’t be living my dream. I’ll be honest with you, my initial response was to say no and stay home; I needed a little convincing.

We will often say no instead of yes as a result of our fears or our laziness. No, we don’t want to go out because we’re too tired. No, we don’t want to quit our jobs and start our own company because we’re afraid we’ll fail. No, we don’t want to see her again because we’re not very good with commitment and she seems like a girl that we may end up falling for. It’s illogical. Of course, sometimes it is better to say no. Unfortunately, there’s no way of knowing until after the fact.

My advice is to say yes as often as you can in order to maximize the possibility of a great opportunity presenting itself. Only say no when you truly believe you will be better off saying no. You may not be right, but we literally can’t say yes to everything because we’ll spread ourselves too thin.

sometimes you win sometimes you learn

‘sometimes you win sometimes you learn’

a negative mind will never give you a positive life

a negative mind will never give you a positive life .

And before I get this comment agaian , a negetive times a negetive doesn’t give a postive !

Eliminate These 8 Things From Your Daily Routine

Eliminate These 8 Things From Your Daily Routine


If you get decent value from making to-do lists, you’ll get huge returns — in productivity, in improved relationships, and in your personal well-being — from adding these items to your not to-do list:

Every day, make the commitment not to:

1. Check my phone while I’m talking to someone.

You’ve done it. You’ve played the, “Is that your phone? Oh, it must be mine,” game. You’ve tried the you-think-sly-but-actually-really-obvious downwards glance. You’ve done the, “Wait, let me answer this text…” thing.

Maybe you didn’t even say, “Wait.” You just stopped talking, stopped paying attention, and did it.

Want to stand out? Want to be that person everyone loves because they make you feel, when they’re talking to you, like you’re the most important person in the world?

Stop checking your phone. It doesn’t notice when you aren’t paying attention.

Other people? They notice.

And they care.

2. Multitask during a meeting.

The easiest way to be the smartest person in the room is to be the person who pays the most attention to the room.

You’ll be amazed by what you can learn, both about the topic of the meeting and about the people in the meeting if you stop multitasking and start paying close attention. You’ll flush out and understand hidden agendas, you’ll spot opportunities to build bridges, and you’ll find ways to make yourself indispensable to the people who matter.

It’s easy, because you’ll be the only one trying.

And you’ll be the only one succeeding on multiple levels.

3. Think about people who don’t make any difference in my life.

Trust me: The inhabitants of planet Kardashian are okay without you.

But your family, your friends, your employees–all the people that really matter to you–are not. Give them your time and attention.

They’re the ones who deserve it.

4. Use multiple notifications.

You don’t need to know the instant you get an email. Or a text. Or a tweet. Or anything else that pops up on your phone or computer.

If something is important enough for you to do, it’s important enough for you to do without interruptions. Focus totally on what you’re doing. Then, on a schedule you set–instead of a schedule you let everyone else set–play prairie dog and pop your head upto see what’s happening.

And then get right back to work. Focusing on what you are doing is a lot more important than focusing on other people might be doing.

They can wait. You, and what is truly important to you, cannot.

5. Let the past dictate the future.

Mistakes are valuable. Learn from them.

Then let them go.

Easier said than done? It all depends on your perspective. When something goes wrong, turn it into an opportunity to learn something you didn’t know–especially about yourself.

When something goes wrong for someone else, turn it into an opportunity to be gracious, forgiving, and understanding.

The past is just training. The past should definitely inform but in no way define you —unless you let it.

6. Wait until I’m sure I will succeed.

You can never feel sure you will succeed at something new, but you can always feel sure you are committed to giving something your best.

And you can always feel sure you will try again if you fail.

Stop waiting. You have a lot less to lose than you think, and everything to gain.

7. Talk behind someone’s back.

If only because being the focus of gossip sucks. (And so do the people who gossip.)

If you’ve talked to more than one person about something Joe is doing, wouldn’t everyone be better off if you stepped up and actually talked to Joe about it? And if it’s “not your place” to talk to Joe, it’s probably not your place to talk about Joe.

Spend your time on productive conversations. You’ll get a lot more done–and you’ll gain a lot more respect.

8. Say “yes” when I really mean “no.”

Refusing a request from colleagues, customers, or even friends is really hard. But rarely does saying no go as badly as you expect. Most people will understand, and if they don’t, should you care too much about what they think?

When you say no, at least you’ll only feel bad for a few moments. When you say yes to something you really don’t want to do you might feel bad for a long time — or at least as long as it takes you to do what you didn’t want to do in the first place.

Read more: http://www.inc.com/jeff-haden/8-things-you-should-not-do-every-day.html?nav=pop#ixzz2r2VSnYFD

“No matter how you feel, get up, dress up and show up.”

“No matter how you feel, get up, dress up and show up.”

Nice !

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