How To Invest Like A Professional

Often, the employer is the only person at a company who believes that the company’s 401(k) or 403(b) plan is a good one.  That’s because he or she set it up and never took the time to learn what an optimal plan looks like. 

The word “optimal” means that a plan has low cost services (no hidden and camouflaged costs) and its core mix of investments match the market’s performance day-after-day; quarter-after-quarter; year-after-year. 

Easy!

The good news is this: Every employer can set up a plan that is optimal, and it will require not more than one hour of his or her time to set it up.  That’s what I teach employers to do, free.  However, most employers cannot fathom that their plan can be improved that easily, so they do the same old, same old and never even try something that is this simple and easy to do.

An optimized plan saves you money because its truly low cost. And it even frees up more of your time because it requires less time to manage and monitor. 

If the cost you pay for services is too high and if investig in no load, low cost, index funds is not an option, then you can ask your employer to improve your plan by cutting its cost and adding a core mix of index funds.  If your employer refuses to improve your plan (he or she may be stuck on stupid), then you may want to take the following action:

1. Contribute just enough money to get the company’s matching contribution.
2. Use a self-directed account (if your plan has that option) so that you can invest in no load, low cost, index funds.
3. Set up a low cost IRA account and contribute up to the maximum allowed by law.

Best wishes,

Your teacher, Frank Cirullo

If you believe that investing in a diversified, core, mix of no load, low cost index funds is the way to go, I can explain why it would be a mistake not to tell your loved ones, friends, and associates about my free lessons on investing in index funds and how to set up a truly low cost, IRA account, 401(k) plan, or 403(b) plan.

Here is why it makes sense and why it’s profitable for you to ask everyone you know to visit my blog at

http://fcmstudents.com/wordpress/

First, please don’t make the classic mistake of trying to teach people this stuff yourself, because they may think that you are an arrogant know-it-all.  And they may even think that you are just another foolish person who likes to give people unsolicited ”hot tips.”  Neither of us wants that for you, do we?  Truly, we want to help people with their IRA account investments and 401k and 403b plans, not alienate them, right? 

Okay, are you ready to learn how you will profit by asking people to visit my blog?

Well, it turns out that the price you pay for index funds, recordkeeping and administration, and other services is always based on supply and demand.

People (vendors /service providers) compete for your business and they use advancing technology to save time and slash the cost of doing business with you.

How does that help you?  Do you remember what I taught you about paying as little as possible for your index funds?  The less you pay, the more money your earn on your investments, right?

It’s competition for your business and advancing technology that lowers the cost of index funds.  See?

Low hanging fruit (foolish investors) are keeping plan costs higher than they should be.  Foolish people hire high cost service providers who sell expensive mutual funds and expensive retirement plans. Often, a trusted person will unwittingly refer you to a high cost service provider.

Nobody will cut his or her fee if they have plenty of business, right?  You wouldn’t volunteer for a pay cut, either, right?  And, as long as the mutual fund companies have plenty of business, not one mutual fund company will cut their cost on the mutual funds that they sell to the public.

Are your loved ones, friends, and associates low hanging fruit (foolish investors) and don’t know it, yet? Their problem is lack of knowledge about investments, investing, and 401(k) and 403(b) plans, because they may be focused on the hype, myths, and half-truths that is everywhere in the media. That kind of stuff only looks like it’s good advice, to amateurs.

Just think about it. Competition for your business and advancing technology are your friends, that is, if you don’t follow the large crowd of investors who are still trying to beat the market by investing in managed funds. If you are following this large herd of people who are trying to beat the market, you, too, will underperform index funds, and you, too, will be part of the problem with the high costs people pay for IRA accounts, 401k and 403b plans, mutual funds. consulting, investment advice, and recordkeeping and administration.

As more people learn about index funds and how they beat the pants off most expert picks, you will see the cost of index funds come down even more.  Remember, the price you pay is always determined by supply and demand.  Be a wise consumer…get the facts and stop listening to people’s opinions.

By the way, don’t fall into the trap of saying this: “If everybody invests in index funds, then index funds won’t be any good anymore.”  First of all, everybody won’t invest in index funds because most people will always be jerked around by their own fear and greed because most people like excitement. 

You should not be afraid to invest in index funds, because, long term, your diversified, core, mix of no load, low cost, index funds will beat the picks of most experts. 

So don’t let financial planners and other experts talk you into selling your elegant mix of index funds and buying managed funds, and/or asset-allocation, target-date, lifecycle, lifestyle, and balanced funds that don’t even have a long term track record of beating no load, low cost, index funds. Experts have inherent conflicts of interest, which means that they will always act in their own best interests–not yours.  See? 

And don’t touch any of those expensive, enhanced, index funds that experts like to sell to the public; especially, if they don’t have at least a ten-year track record of beating the plain, no load, low cost, index funds that we are talking about, right here.

Best wishes,

Your teacher, Frank Cirullo

In a moment, I will tell you a true story.  It’s about a group of lovely grandmas who are infamous for making a classic investment mistake and lying to the public about their investment track record.

An expert’s image is created by packaging, and it counts for everything at seminars and workshops and on radio and television.  Yes, show business trumps the facts, and the track record that many experts present to the public is not always what it seems.

You have heard it a thousand times: Things are not always what they seem.  You will have a better chance of not shooting yourself in the foot if you stop wanting something badly enough (fear and greed) to rush into giving yourself reasons to make a bad decision.  At the moment you make a decision, you will not know that you may have made a bad decision–that is why it is called a mistake.

The Beardstown Ladies investment club was packaged and they were naturals on stage.  These Grandmas were so charming that no one questioned the lies they told us about how they crushed the experts on Wall Street with their stock picking skills.

Now, lying on TV and radio is not anything new.  Many experts leave out material facts about their track record for the purpose of making themselves look like something they are not.  But the bottom line is this.  If you leave out material facts about your track record, you are deceiving the public.

Prior to this, did you know that leaving out material facts is a form of lying?  It is lying, and that is why you need to ask the right questions before you invest your hard-earned money.  The first question you should always ask an expert is this.  Do you have at least a ten-year track record of beating the market?  If so, show it to me, but do not try to fool me by cherry picking investments that you did not own back then. And don’t try to fool me by cherry picking time frames, either.

My point is this.  The media and the public fell in love with the Beardstown Ladies, but it was the kind of hoax that not even these grandmas knew was a lie.  They were happy with the growth of their investments, because they did not realize that most of the growth in their portfolio came from their own money that they invested each month, not from capital gains.  And even their investment adviser, who became famous along with them, did not know how awful their real Return on Investment (ROI) was.  The bottom line is this.  The adviser did not know that he and the lovely grandmas were lying to the public about their track record.

Do not make the same mistake that these grandmas and their investment adviser made regarding their ROI, because if you make it with your own investments it may cost you a fortune–long term. How? You will be satisfied with your awful investments that underperform the market, and it will never occur to you to switch to investments that are designed to match the market.

Here is what I am talking about.

The Beardstown Ladies had to apologize for lying to the public after a reporter named Shane Tritschm looked at the facts. The facts showed that the growth in their portfolio came from their own money, which was the deposits that they made into their investment account, each month, and not from the huge capital gains they claimed they earned on their stocks.

The ladies and their investment adviser claimed that their highest annual return was 23.4 percent, which was amazing for that time-frame, but facts are stubborn things.  A Price Waterhouse audit uncovered a yearly return of 9.1 percent.  In other words, their stock picks underperformed the market for that same time-frame. 

These lovely grandmas could have invested in no load, low cost, index funds and not paid their trusted investment adviser a bunch of money in commissions.  Had they done that they would have matched the market less the cost of their funds, and they would have enjoyed the following benefits:

1.     They would have had more money, because they would have at least matched the market’s performance–long term. Instead, they underperformed the market.

2.     They would have had more time, because it requires less time to research index funds than it takes to research stocks and managed mutual funds.

3.     They would have had less stress, because it is comforting to know that your investments will match the market’s performance less your cost and that your ROI will be good enough to beat the pants off most experts.

If you want more money; more time; and less stress, you can do it the easy way: invest in a mix of investments that will match the market’s performance.  And, too, the easy way is to read my blog—every day.  How you invest your time, every day, really does matter most.  That way it does not require more than a few minutes of your time to invest, because you can pick up the telephone and tell the brokerage firm’s representative what you want him or her to do for you. Easy!  Never ask an investment adviser what you should do about your investments because he or she has inherent conflicts of interest.  Instead, give him or her instructions on what you want to invest in.  See? 

Summary: Your IRA account, 401(k) plan, or 403(b) plan may be growing because of your own money that you contribute each month, and not because of capital gains from your investments. A time-weighted return will show you the truth about your investment picks because it accounts for deposits, withdrawals, and gains or losses during a certain time frame. Or you can you can just match the market’s performance.  That way you will not have to worry about if you are doing the right thing for yourself and your loved ones.

The bottom line is this.  The worst thing you can do is to be happy and/or satisfied with your investments that underperform index funds; especially, if you do not see what is happening with your hard-earned money until you retire.

Best wishes,

Your teacher, Frank Cirullo

“It’s not what you know that causes you problems.  It’s what you know that ain’t so.” –Will Rogers.

Slow down. 

Take your time. 

Don’t be in a hurry.

It will serve you to work on opening your closed mind so that it can learn the truth about investments and investing. 

First, consider the possibility that you are making costly mistakes with your money.

Second, be honest because that is the only way you can learn what’s best for you.  For instance, have you ever picked a mix of managed funds that beat a diversified, core, mix of index funds in performance–long term?  No!  Has your investment adviser?  No!  Always ask for the expert’s long term track record, which should be at least ten years.  Why would you have silly portfolio reviews will people who don’t have a track record?

Third, learn what will make you a successful investor, long term:  For instance, a diversified, core, mix of index funds will match the market’s performance less the cost of the funds you own.  That will give you a track record that will beat the performance of most experts–long term.  Long term, you will be a successful investor providing you don’t listen to the cleaver fools who want to dumb you down. Cleaver fools are the people who don’t have a long term track record but use charts and graphs to pretend they do.

Forth, think about what having a better track record than most experts means.  It means you will save precious time, because you won’t have anymore silly meetings with experts.  And you’ll have more money, too, because you will match the market’s performance, not underperform it like most experts do.

Your assignment for today is to think about the truth about investments and investing. 

For instance, you may hope you can beat the market, but is hope a strategy?  No!  Is picking investments that will match the market’s performance a strategy that will serve you?  Yes!  It will beat the pants off most experts and it will also beat the pants off any of your friends who don’t get it yet 

By the way, you can help yourself even more by helping your friends.  How?  Point them in right direction so that they, too, can learn the truth.  Warning: If you try to teach them they won’t believe you, because their mind is closed.  Instead, send them an e-mail; ask them to read my blog posts if they want free lessons on investing their money.  Easy!

In conjunction with what you are learning here, how will pointing your friends and associates in the right direction help you?

I’ll show you, tomorrow.

That was easy, right?

Best wishes,

Your teacher, Frank Cirullo

Many people believe that cutting a retirement plan’s cost and/or improving its investment performance involves hard work and complex solutions. 

Have you convinced yourself that you don’t have time to learn how to improve your IRA account, 401(k) plan, or 403(b) plan? 

Yes, you can improve your plan.  Easy!  Ask for help, today. 

If you have an IRA account, type your name and e-mail address in the box above. 

If you have a 401(k) plan or 403(b) plan, click on the appropriate link to your right.

Best wishes,

Your teacher, Frank Cirullo

If you get burned, you act fast to protect yourself, right?

Financially, many people are being burned by their high cost IRA account, 401(k) plan, or 403(b) plan, but they can’t feel the pain–yet.  That’s why they refuse to act fast to make the necessary changes!

It’s true that the majority of people have an expensive retirement plan; therefore, it’s likely you, too, have a plan that is too expensive.  Would you like to learn what to watch for?  If so, send me an e-mail at fcirullo@fcmstudents.com .  That way you won’t touch the myriad of expensive IRA accounts, 401(k) plans, or 403(b) plans again–ever!

Best Wishes,

Your teacher, Frank Cirullo

Note:

You don’t need to be a student to ask me a question.  Visitors can ask questions, too.

Nor do you have to be a student to tell me about a problem you want to solve. 

Yes, even if you are visitor you can ask me for help anytime you want my help.

My e-mail is: fcirullo@fcmstudents.com

Regarding your IRA account, 401(k) plan, or 403(b) plan, do you want help with one of the following issues?

1. Save time on monitoring your investments.
2. Save time on selecting a mix of investments for your plan.
3. Set up an automatic asset-allocation and re-balanciing program, free.
4. Save time on choosing a plan.
5. Save time on setting up a plan.
6. Save time on managing your plan.
7. Save time on monitoring your plan.
8. Other: Tell me what you want help with.

I’ll be happy to show you one or more proven solutions to any problem you may ask me for help with. 

Note: Proven means the idea or solution will will work every time it is tried.  You’ll see the result instantly.

Yes, you can use my proven ideas that can save you time and money–free.  After you read the idea or solution, you can use it fast. 

Send your e-mail to: fcirullo@fcmstudents.com 

Best wishes,

Your teacher, Frank Cirullo

Watch this 2 minute video/  It shows you a fast and easy way to improve your 401(k) plan.

401kplanschool: FREE Lesson

CLICK LINK, above.  Learn How To Improve Your 401(k) plan fast.

Best wishes,

Your teacher, Frank Cirullo

Are you wondering what you need to do next with your 403(b) plan? 

http://403bplanschool.com/403b-Article.php

Well, click the link shown above and check this article out.  Why?  I wrote it just for you.  It shows you what to do next.  Easy!

Best wishes,

Your teacher, Frank Cirullo

High retirement plan fees and expenses are like poison running through you veins. 

Did you know that Congress has determined that most employers and workers don’t know how much their plan costs? 

So, why don’t employers cut expenses today? Many employers unwittingly believe they have cut their plans expenses as much as they can.  Others believe they will get around to cutting their plan’s expenses at their next committee meeting with their plan’s vendors. 

Take a moment to consider this important fact:  If you have a high cost plan, would your plan’s vendors advise you to fire their company for charging you too much?  No!  It will never happen, right? 

Now do you see the problem with asking for advice from people who have inherent conflicts of interest?  Which vendors have conflicts of interest?  Consultants; investment advisers; and recordkeepers and administrators all have inherent conflicts of interest.  The proof is that not one of them will act, 100%, in your best interests–not one of them will ever fire his or her own company for charging you too much. 

That’s why you need to learn how to spot high costs at a glance.  Take our free mini-course.  That way you won’t waste your precious time in meetings with vendors, anymore. See?

Many employers have made up their minds that their plan is low cost.  If that is your mindset, not even Congress or the Department of Labor (DoL) will be able to convince you that you really can slash your plan’s expenses today.

Tips:

1. How much do you pay for recordeeping and administration? Do you pay more than $25.00, per year, per employee or eligible employee?  Why?  Did you know that the less workers pay, the more times their money will double before they retire.
2. Does your plan offer truly low cost index funds that cost not more than 0.07% to 0.20%,  per year?  Again, the less workers pay, the more times their money will double before they retire.
3. Do you get revenue sharing?  Did you know that revenue sharing can act as an effective smoke screen that hides your plan’s biggest expense?  Getting revenue sharing on investments that under-perform low cost index funds is one of the reasons your plan costs workers too much. 
4. Bonus tip: Learn how to identify the myriad of smokescreens that vendors use to sell services, investments, and bundled plans. 

If you want to know more about hidden retirement plan expenses and how you can make your plan truly low cost today, you can take our free mini-course at either:

 http://www.401kplanschool.com or http://www.403bplanschool.com.

Best wishes,

Your teacher, Frank Cirullo