Page 11 - aruba-today-20210112

A11
business Tuesday 12 January 2021

4 financial ‘experts’ who could steer you wrong

By LIZ WESTON comfortably afford. Neither true. But IRAs can cost you curity as early as age 62,
of NerdWallet can your real estate agent, more, and 401(k)s have but your monthly benefit
None of us knows every- for that matter. better consumer protec- increases the longer you
thing we need to know True affordability will de- tions. delay applying until it max-
about money, so we may pend on a lot of factors Stockbrokers want to sell es out at age 70. Multiple
turn to experts for help. But that aren’t captured in you investments that earn studies have shown that
some money professionals your application, includ- them commissions. Typi- most people will collect
who offer advice are not ing when you want to retire cally, they have no respon- more over their lifetimes if
qualified to do so — nor are and how much you want sibility to make sure those they delay filing. It’s par-
they required to put our in- to save for other goals such investments are in your ticularly important for the
terests ahead of theirs. as a child’s education. best interest. By contrast, higher earner in a married
Be cautious when accept- There’s also your comfort a 401(k) administrator is a couple to delay, because
ing advice from the follow- level. Some people are fine fiduciary, so it’s required to that benefit determines
ing sources. borrowing the maximum, put your interests first and what the survivor will get
THE DEALERSHIP ABOUT because they believe their provide good investment once the first spouse dies.
HOW LONG YOUR AUTO finances will only get bet- options at a reasonable Unfortunately, Social Secu-
LOAN SHOULD BE ter. Others prefer to borrow cost. Many 401(k)s offer rity Administration employ-
The dealership wants to Liz Weston is a columnist at more conservatively. access to ultra-low-cost in- ees sometimes advise peo-
sell you a car. To make the NerdWallet A BETTER APPROACH: Use stitutional funds that aren’t ple to start early — even
payments more afford- Associated Press online calculators to esti- available in an IRA. though Social Security em-
able, you may be offered a mum of five years for new mate how much to save for In addition, your entire ployees aren’t supposed to
loan that lasts six, seven or cars or three years for used retirement and other goals. 401(k) balance is protect- give advice.
even eight years. cars. A 20% down payment Then include those figures ed from creditors. By con- Applicants have been
Longer loans can get you can help you avoid nega- in your monthly expenses trast, your protections with told, for example, that it
smaller monthly payments, tive equity, as well. Con- when using a mortgage an IRA depend on state doesn’t matter when they
but they cost more overall, sider getting pre-approved affordability calculator. Or law. Many states exempt start benefits because the
since you’ll pay more inter- for a loan from your local consult a fiduciary adviser, only an amount “reason- amounts paid out over their
est. You’ll also likely spend credit union or bank or an such as a certified financial ably necessary for support” lifetimes will be the same.
several years “upside online lender. That can help planner, accredited finan- — which means in some That’s a misinterpretation
down,” or owing more than you withstand the dealer- cial counselor or accred- cases, creditors potentially of Social Security’s attempt
your vehicle is worth. As the ship trying to pressure you ited financial coach. “Fi- could get it all. to be “actuarially neutral,”
car ages, you could easily into expensive financing. duciary” means obligated A BETTER APPROACH: Leave or have the system pay out
face big repair bills while MORTGAGE PROS ABOUT to put your best interests the money where it is if you the same amount in total
still making payments. If HOW MUCH HOUSE YOU first. Most financial advisers like the old 401(k)’s invest- regardless of when people
you needed to sell the car, CAN AFFORD aren’t fiduciaries, so make ment options, or roll it into claim benefits.
you would have to come Good mortgage brokers sure to ask. a new employer’s plan if A BETTER APPROACH: A So-
up with money to pay off or loan officers can be in- STOCKBROKERS ABOUT that’s allowed. Otherwise, cial Security claiming cal-
the loan. Alternatively, you valuable in helping you WHETHER TO ROLL OVER roll the money into an IRA culator can help you figure
could roll the negative navigate a complicated YOUR 401(K) at a discount brokerage. If out when to start benefits.
equity into your next car process and understand A stockbroker may tell you you need help with how to AARP has a free one, while
purchase, but that would the guidelines that lenders that rolling your old 401(k) invest it, consult a fiduciary more sophisticated versions
make your next loan even use to determine how big account into an individual adviser. are available starting at
more expensive. of a loan you can qualify retirement account gives SOCIAL SECURITY ABOUT $20 at Social Security Solu-
A BETTER APPROACH: Limit for. But they can’t tell you you many more investment WHEN TO CLAIM BENEFITS tions or $40 at Maximize My
your auto loans to a maxi- how big of a loan you can options, and that’s typically You can collect Social Se- Social Security.q
Insider Q&A: Bitcoin’s massive rise and what comes next

By KEN SWEET hind the currency, known total fund in Bitcoin directly. remains attractive are the
AP Business Writer as the blockchain. Q: It took two years for Bit- companies who are using
CHARLOTTE, N.C. (AP) — He spoke to The Associated coin to rally back to its re- Bitcoin and the blockchain
The digital currency Bitcoin Press about Bitcoin’s recent cord hit in late 2018. What’s infrastructure to build use
rocketed to a record high rise and what’s different this different this time? cases and practical appli-
last week above $40,000 time for the currency: A: Nothing has changed cations for it.
a coin. This comes after Q: Tell us a little bit about with Bitcoin in the last two Q: Evangelists of Bitcoin
the currency languished the fund. years. It’s still a decentral- and other currencies talk
for two years, plummet- A: We’re an actively man- ized digital currency us- about how it will replace
ing from the previous high aged fund, because things ing the blockchain cre- paper money. In two years,
of $19,000 reached back in blockchain and this ated years ago. What’s that hasn’t happened. Do
in December 2018, when space are changing all changed is perception. In- you think it will ever hap-
Bitcoin was subject to an- the time it would be impos- vestors are looking for safe pen?
other round of media hype sible to build a passively harbors for their assets, simi- A: The original argument
and investor interest. managed fund. We invest lar to how gold and silver for Bitcoin was it would This undated photo shows Mike
Mike Venuto is co-portfolio in blockchain companies, are used. provide the ability for the Venuto, co-portfolio manager
of the Amplify Transformational
manager for the Amplify miners, and other compa- Q: Should investors expect unbanked — those with- Data Sharing ETF.
Transformational Data nies in the space. We hold Bitcoin to keep going up? out bank accounts — to Associated Press
Sharing ETF, a $391 million a small amount of Bitcoin A: Bitcoin is going to re- transact securely without a
fund that focuses on com- and other currencies, but main as volatile as ever, bank. Is that going to ma- coin. It’s largely become
panies that trade and de- mostly get our exposure and there will be bumps in terialize? Will you be able a store of value. But with
velop uses for Bitcoin and through the companies we the road. You’ll see mas- to buy a cup of coffee with other cryptocurrencies, we
other digital currencies, as own. But we would never sive moves up and mas- Bitcoin? Probably not with are seeing use cases like
well as the technology be- hold more than 5% of the sive moves down. What the current version of Bit- that.q