The Morrison County Record http://mcrecord.com Covering community news, sports, current events and provides advertising and information for the Morrison County, Minnesota. Wed, 01 Jul 2015 13:21:17 +0000 en-US hourly 1 Agronomist shares insights for summer soybean success http://mcrecord.com/2015/07/01/agronomist-shares-insights-for-summer-soybean-success/ http://mcrecord.com/2015/07/01/agronomist-shares-insights-for-summer-soybean-success/#comments Wed, 01 Jul 2015 13:21:17 +0000 http://mcrecord.com/?p=577932 By Eric Beuning, Correspondent

Anez Consulting Agronomist Michael Dunn in a production soybean field west of Pierz,  June 30. 

Anez Consulting Agronomist Michael Dunn in a production soybean field west of Pierz, June 30.

Soybeans are a popular crop grown all across Morrison County. This can be a pivotal time of year for managing a soybean field depending when it was planted and what insects are present.

“Soybeans that were planted early in the season will start to flower as the days get shorter after the summer solstice,” said Anez Consulting Agronomist Michael Dunn.

White mold is one of the most pertinent threats when soybeans are actively flowering.

“The mold infects the plant after the flowers are pollinated. If your area has a history of white mold it is important to spray your soybean field with fungicide. We find it’s best to give the field two applications, one when the plants first start to flower and again about two weeks later,” said Dunn.

One of the biggest problems caused by white mold is lodging, where plants tend to lay down in the field making harvest harder and reducing overall yield. Additionally, white mold tends to result in smaller seeds and more aborted pods.

White mold eventually forms a sclerotia, which looks like a small black pellet similar to mouse feces. When a producer takes the soybeans in, the elevator usually pays them less per bushel.

Insect pests such as soybean aphids can also have a major impact on a field.

“Luckily soybean aphids aren’t very heavy at the moment. The highest population we’ve found so far is 50 per plant. However, under ideal conditions they can potentially double in number in only a few days,” said Dunn.

The generally accepted economic threshold for soybean aphids is 250 aphids per plant, but this varies with many factors including the cost of treatment, price of soybeans and stage of soybean development.

Soybean aphids are viviparous as well as parthenogenetic. This means that an individual aphid generates offspring eggs before its own birth and can then reproduce a-sexually in the field.

“I would caution growers not to spray with a pyrethroid based insecticide,” said Dunn. “Those types of insecticides will kill aphids and beneficial insects but not spider mites. In dry weather this could cause the spider mite population to really flare up.”

“There are some insecticides like Transform that will kill aphids without harming certain beneficial insects.”

Some soybean fields in the county were planted later. “Weed control issues are one of the primary problems you find in late planted fields at this time.”

“One of the most common weeds we are finding in soybean fields this year is volunteer corn,” said Dunn.

Volunteer corn is found in fields where corn was planted the previous year. Stray kernels fall on the ground during harvesting and then germinate the next year right alongside soybeans.

“People should keep in mind that even though it is a corn plant it’s still competing with the soybeans. If it’s just a small number you can pull the corn plants by hand otherwise there are certain herbicides you can add to Roundup that will kill the volunteer corn when you spray.”

Waterhemp is another weed showing up in Morrison County that is worthy of serious concern.

“Unfortunately waterhemp is becoming increasingly Roundup resistant,” explained Dunn. “We’ve found it’s best to try to get it before the weeds are two inches tall. Once they get past that they are more difficult to control in the field.”

“We recommend using multiple modes of action in your herbicide program, spraying when the weeds are small, using residual herbicides if possible, and where white mold is not an issue, planting in narrower rows so that the soybeans achieve canopy sooner.

Fields that were left unplanted last year also have to contend with competition from perennial weeds. “These weeds had a full year to develop and may have been missed by tillage, so they are tough. We’ve found that Roundup doesn’t do too well against perennial weeds during the growing season,” said Dunn.

“We’ve found the best way to kill tough perennial weeds is in the fall. You want to target them right after the harvest when the weeds are still green. You should use multiple modes of action in your herbicide program like Roundup with 2,4-D.

With a watchful eye for some of these common problems and application of the right techniques, soybean producers all across Morrison County could have a strong harvest this year.

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Stocks Up, Bonds Down? http://mcrecord.com/2015/07/01/stocks-up-bonds-down/ http://mcrecord.com/2015/07/01/stocks-up-bonds-down/#comments Wed, 01 Jul 2015 13:00:06 +0000 http://mcrecord.com/?guid=973f740e8ed377d65fe7120440056efc Since the financial crisis, when both stocks and bond prices took a pounding, the normal pattern returned: Stocks zig when bonds zag. That usually meant that trouble in the world tanked stocks and buoyed bonds, particularly Treasuries. Nowadays, though, stocks and bonds may end up trading places.

Currently, activity is intensifying in the bond market, amid the prospect of rising rates, which should lead to lower bond prices. For stocks, a shrinking supply of shares outstanding could bring higher prices. To be sure, other forces might emerge to shatter any such trends, but for now they are worth taking into consideration when investing.

In the bond market, traders were buying during the price dips through January of this year. For the past four months, they have been selling on the upticks. Volatility is high.

For non-traders, this means interest rates are going higher and bond values are going lower. (When rates go up, prices go down, and vice versa.) The five-year U.S. Treasury rate is at 1.63% lately, the high end of a range that began two years ago. The widely traded benchmark 10-year Treasury, at 2.34%, is headed back toward its 2.59% level from mid-year 2014. In Germany, the 10-year government bond rate has climbed to about 0.77% from around 0.07% in the past few months.

Bond traders are momentum traders. Momentum begets momentum in the bond market, more so than in the stock market. Bond traders are betting rates are going meaningfully higher, especially for shorter-term issues.

That’s for two reasons: 1) central bank stimulus, through extensive bond buying called quantitative easing (QE), held rates artificially low, and 2) the U.S. and European economies are gaining strength. Fundamental economic strength lifts rates as return on invested capital rises, demand for capital increases and lenders are able to charge more.
 
The bond market often leads the equity market. In this case, the bond market is beginning to signal a normalization of the interest rate environment, driven by fundamental strength in many of the developed world economies.

Meanwhile, stock supply is shrinking. Absent any other dynamic, such as an international crisis or a major economic debacle, this trend should put upward pressure of share prices. At a fundamental level, stock market valuation is set at the equilibrium price that balances demand with supply. Acquisitions, bankruptcies, going private and stock buybacks are overwhelming new stock issuance through initial public offerings. Thus far in 2015, the market is flat, after a long bull run.

At our firm, we regularly update our database of roughly 3,400 stocks. In the most recent update cycle covering the past year, we removed a net 178 companies from our database as they are no longer publically traded. This 178-company departure is a surprisingly large reduction of more than 5%.
 
Many of the companies are household names that have been public for years. The three largest announced acquisitions were cable colossus Comcast’s $71 billion buy of Time Warner Cable, telecom giant AT&T’s (T) $67 billion purchase of DirecTV and drug maker Activis’ (ACT) $66 billion acquisition of Allergan. Other long-standing companies to disappear include Wellpoint, merged with health insurer Anthem (ANTM), and supermarket chain Safeway, which went went private.
 
Research firm FactSet tracks the aggregate common shares outstanding in the Standard & Poor’s 500 using a rolling universe and also a universe of only the companies that were in the index throughout the period reviewed. It may provide the best indication of absolute U.S. stock share count. In the past five years, the fixed universe of S&P 500 stocks has diminished by about 5.7%.

Macintosh HD:Users:aiqinc:Desktop:unnamed-1.jpg

On the demand side, cumulative flows into U.S. equity mutual funds and exchange-traded funds since 2007 through February 2015 have been slightly positive, with the growth coming from institutions like pension plans. The $661 billion of retail outflows were offset by $665 billion of institutional investor inflows. Who is right, individual investors or the institutions? Well, at times, market observers have called insiders and institutions “smart money.”

Macintosh HD:Users:aiqinc:Desktop:unnamed.jpg

It is difficult to equate a supply contraction relative to a constant demand into market aggregate price impact. The high-level supply/demand statistics show demand has generally exceeded supply, which leads to higher prices. Additionally, the demand has come from insiders and institutions via stock buybacks and mergers and acquisitions. U.S. merger and acquisition activity hit $1.53 trillion in 2014, up 51.4% from 2013 and near all-time high levels.

Trading volume tends to lighten in the summer months and global-macro uncertainty can create significant volatility. It is possible that the Greek debt situation is just a distraction and markets won’t be able to rally until there is clarity on the Federal Reserve rate liftoff. If the underlying shrinking supply and steady demand stock backdrop remains in place, the market should prove resilient over time.

Follow AdviceIQ on Twitter at @adviceiq.

Nicholas Atkeson and Andrew Houghton are the founding partners of Delta Investment Management, a registered investment advisory firm in San Francisco, and authors of the new book, Win by Not Losing: A Disciplined Approach To Building And Protecting Your Wealth In The Stock Market By Managing Your RiskAdditional market commentary and investment advice is available via their websites at www.deltaim.com and www.deltawealthaccelerator.com

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

 

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Since the financial crisis, when both stocks and bond prices took a pounding, the normal pattern returned: Stocks zig when bonds zag. That usually meant that trouble in the world tanked stocks and buoyed bonds, particularly Treasuries. Nowadays, though, stocks and bonds may end up trading places.

Currently, activity is intensifying in the bond market, amid the prospect of rising rates, which should lead to lower bond prices. For stocks, a shrinking supply of shares outstanding could bring higher prices. To be sure, other forces might emerge to shatter any such trends, but for now they are worth taking into consideration when investing.

In the bond market, traders were buying during the price dips through January of this year. For the past four months, they have been selling on the upticks. Volatility is high.

For non-traders, this means interest rates are going higher and bond values are going lower. (When rates go up, prices go down, and vice versa.) The five-year U.S. Treasury rate is at 1.63% lately, the high end of a range that began two years ago. The widely traded benchmark 10-year Treasury, at 2.34%, is headed back toward its 2.59% level from mid-year 2014. In Germany, the 10-year government bond rate has climbed to about 0.77% from around 0.07% in the past few months.

Bond traders are momentum traders. Momentum begets momentum in the bond market, more so than in the stock market. Bond traders are betting rates are going meaningfully higher, especially for shorter-term issues.

That’s for two reasons: 1) central bank stimulus, through extensive bond buying called quantitative easing (QE), held rates artificially low, and 2) the U.S. and European economies are gaining strength. Fundamental economic strength lifts rates as return on invested capital rises, demand for capital increases and lenders are able to charge more.
 
The bond market often leads the equity market. In this case, the bond market is beginning to signal a normalization of the interest rate environment, driven by fundamental strength in many of the developed world economies.

Meanwhile, stock supply is shrinking. Absent any other dynamic, such as an international crisis or a major economic debacle, this trend should put upward pressure of share prices. At a fundamental level, stock market valuation is set at the equilibrium price that balances demand with supply. Acquisitions, bankruptcies, going private and stock buybacks are overwhelming new stock issuance through initial public offerings. Thus far in 2015, the market is flat, after a long bull run.

At our firm, we regularly update our database of roughly 3,400 stocks. In the most recent update cycle covering the past year, we removed a net 178 companies from our database as they are no longer publically traded. This 178-company departure is a surprisingly large reduction of more than 5%.
 
Many of the companies are household names that have been public for years. The three largest announced acquisitions were cable colossus Comcast’s $71 billion buy of Time Warner Cable, telecom giant AT&T’s (T) $67 billion purchase of DirecTV and drug maker Activis’ (ACT) $66 billion acquisition of Allergan. Other long-standing companies to disappear include Wellpoint, merged with health insurer Anthem (ANTM), and supermarket chain Safeway, which went went private.
 
Research firm FactSet tracks the aggregate common shares outstanding in the Standard & Poor’s 500 using a rolling universe and also a universe of only the companies that were in the index throughout the period reviewed. It may provide the best indication of absolute U.S. stock share count. In the past five years, the fixed universe of S&P 500 stocks has diminished by about 5.7%.

Macintosh HD:Users:aiqinc:Desktop:unnamed-1.jpg

On the demand side, cumulative flows into U.S. equity mutual funds and exchange-traded funds since 2007 through February 2015 have been slightly positive, with the growth coming from institutions like pension plans. The $661 billion of retail outflows were offset by $665 billion of institutional investor inflows. Who is right, individual investors or the institutions? Well, at times, market observers have called insiders and institutions “smart money.”

Macintosh HD:Users:aiqinc:Desktop:unnamed.jpg

It is difficult to equate a supply contraction relative to a constant demand into market aggregate price impact. The high-level supply/demand statistics show demand has generally exceeded supply, which leads to higher prices. Additionally, the demand has come from insiders and institutions via stock buybacks and mergers and acquisitions. U.S. merger and acquisition activity hit $1.53 trillion in 2014, up 51.4% from 2013 and near all-time high levels.

Trading volume tends to lighten in the summer months and global-macro uncertainty can create significant volatility. It is possible that the Greek debt situation is just a distraction and markets won’t be able to rally until there is clarity on the Federal Reserve rate liftoff. If the underlying shrinking supply and steady demand stock backdrop remains in place, the market should prove resilient over time.

Follow AdviceIQ on Twitter at @adviceiq.

Nicholas Atkeson and Andrew Houghton are the founding partners of Delta Investment Management, a registered investment advisory firm in San Francisco, and authors of the new book, Win by Not Losing: A Disciplined Approach To Building And Protecting Your Wealth In The Stock Market By Managing Your RiskAdditional market commentary and investment advice is available via their websites at www.deltaim.com and www.deltawealthaccelerator.com

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

 

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MMFCU’s Jodi Allen named Chamber’s Employee of the Month http://mcrecord.com/2015/07/01/mmfcus-jodi-allen-named-chambers-employee-of-the-month/ http://mcrecord.com/2015/07/01/mmfcus-jodi-allen-named-chambers-employee-of-the-month/#comments Wed, 01 Jul 2015 12:42:55 +0000 http://mcrecord.com/?p=577927 By Terry Lehrke, News Editor

Jodi Allen, a consumer lending sales consultant  with Mid-Minnesota Federal Credit Union in Little Falls, is the Employee of the Month for July.

Jodi Allen, a consumer lending sales consultant with Mid-Minnesota Federal Credit Union in Little Falls, is the Employee of the Month for July.

Jodi Allen has been named as the July Little Falls Area Chamber of Commerce Employee of the Month. Allen has been with Mid-Minnesota Federal Credit Union for two years, and was just promoted to the position of consumer lending sales consultant  in June.

Allen said she was both shocked and honored to be nominated and selected.

“Mid-Minnesota Federal Credit Union is a great place to work,” she said. “Their core of integrity, teamwork, sense of community and personal responsibility are what attracted me to this organization.”

Described as a team player, Allen’s supervisor Jeanne Lee nominated her.

“She is fast on her feet and truly cares about our members and their well-being and what is in their best interest,” Lee said.

Willing to go above and beyond, Lee said, “Jodi is willing to help anyone out at any time … to do the right thing, every time.”

Allen said she had just been promoted to consumer lending sales consultant, having worked in member services prior to that, where she worked with customers in all levels of banking.

Working with her customers, helping them and letting them know someone was there to listen, was her favorite part of the job.

Allen is engaged to Chris Burgardt with the wedding planned for February 2016. Between the two of them, they have six kids, ages 2, 7, 10, 12, 12 and 13.

In her spare time she enjoys spending time with her family, camping and “I like to bake,” she said.

As Employee of the Month, Allen will receive professional photography services from Silker Studio and salon services from Fresh Hair Professionals.

The award is also accompanied by gift certificates from AmericInn, Burger King, Fitness Connection, Franciscan Sisters, Gumdrop Tree, Lindbergh Historic Site, ServiceMaster, Subway, Vacuum Cleaner Center and Outlet and the West Side Bar.

Allen will also receive flowers from Northern Image Landscaping as well as a cookbook from CHI St. Gabriel’s Health Hospice Program.

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Rosemary Rosie Boehm http://mcrecord.com/2015/07/01/rosemary-rosie-boehm/ http://mcrecord.com/2015/07/01/rosemary-rosie-boehm/#comments Wed, 01 Jul 2015 11:14:42 +0000 http://mcrecord.com/?p=577925 Rosemary Rosie   Boehm

Rosemary "Rosie" Boehm, 79-year-old resident of Little Falls, died Monday, June 29, 2015, at Highland Senior Living in Little Falls.
A Mass of Christian Burial will be held Thursday, July 2, at 10:30 a.m. at the St. Francis Convent Sacred Heart Chapel in Little Falls. A visitation will be held Thursday, July 2 from 9:30 a.m. until the hour of the service on Thursday at the St. Francis Convent. The burial will be held Thursday, July 2 at 3 p.m. at Calvary Cemetery in Forest Lake.
Rosemary Florence Boehm was born Nov. 11, 1935, in Forest Lake, the daughter of Anthony and Loretta (Mitchell) Boehm. Robert, her only sibling, died as an infant. Rosemary graduated from Forest Lake High School, Forest Lake, in 1953. She earned a two year-associate degree as a physical therapy assistant from St. Mary's Junior College, Minneapolis, in 1969. Rosemary joined the Franciscan Sisters in Little Falls, in 1962 and was given the name Sister Mary Louis. She returned home to care for her sick and elderly parents. She used her physical therapy skills at St. Ansgar Hospital, Moorehead; Trinity Memorial Hospital, Cudahy, Wis.; St. Mary's Hospital, Minneapolis; Little Sisters of the Poor, St. Paul and Bethany Home operated by the St. Joseph Sisters of Carondelet. In 1996, Rosemary came to St. Francis Convent, Little Falls, to set up a rehabilitation department for the care of the Senior Sisters. Rosemary returned to live in Little Falls in May, 1999. She often referred to this time as "coming back home." She was a person who knew how to bring happiness into the lives of others.
She is survived by the Franciscan Sisters, relatives and many lifelong friends.

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Parable for Roth Conversion http://mcrecord.com/2015/06/30/parable-for-roth-conversion/ http://mcrecord.com/2015/06/30/parable-for-roth-conversion/#comments Tue, 30 Jun 2015 20:00:24 +0000 http://mcrecord.com/?guid=0db442d79cea5d8a1ba1af95c81b55d0 Many boomers keep most savings in either 401(k) plans or traditional individual retirement accounts. If you’re in this generation, born between 1946 and 1964 and with a few working years remaining before retirement, consider converting your IRA to a Roth.

With a traditional IRA, you get a tax break on your contributions in the current year and in retirement your withdrawals incur income tax. With a Roth IRA, you get no income tax deduction on plan contributions, but your investment earnings and withdrawals incur no income taxes.

Roth IRAs do come with restrictions. Your contributions are limited to $5,500 a year ($6,500 if you’re 50 or older), but if your modified adjusted gross income is too high in 2015 ($193,000 for married, filing jointly, and $131,000 for single) you cannot contribute to a Roth IRA. However, there are no income limits that prevent any amount of Roth IRA conversions. You must be at least age 59½ when you begin taking withdrawals from the Roth and you can’t withdraw money until you participate in at least one Roth IRA plan for at least five years.

Though most tax-sheltered plans require you start required minimum distribution (RMD) withdrawals no later than age 70½, Roth IRAs do not require RMDs.

Perhaps the easiest way to think of the advantages of such a conversion is to imagine you are a farmer. It’s early March, and you hear a knock at the front porch door.

“Hello,” says the man at the door, “I’m from the Internal Revenue Service and I’m here to help you. The federal government is experimenting with a new tax system. We can go right now to your barn and take the physical weight of your seed corn that you plan to plant next month. I will then tax you on its value in 2015.”

“Its value is $300,000,” you say.

“If you take that choice,” the man adds, “no matter how much corn you grow on your farm now and in the years ahead, there will be no tax after 2015 for the next three generations.”

You stand there in silence, trying to understand. The IRS man continues: “I know that farmers are very conservative. You probably don’t want to try a tax system that is something different.

“If you stay with the current tax system, I will come back at the end of this year’s harvest and tax you on the value of the physical weight of the mature corn kernels, the corn cob and the stalk. In fact, I will tax you on every harvest that this farm produces as long as your family owns this farm.”

You realize that the physical weight of the corn seed right now is far less than the total weight of the corn at harvest, and that the total weight of future harvests will be enormous and will be taxed for the next 80-plus years. You tell the IRS man:

“I understand that you think that the physical weight of all this seed, held in a self-directed IRA, is worth $300,000. If I convert this to a Roth IRA, you will tax me on $300,000 and never come back. Over the next 80 years, this farm will produce $300 million worth of corn crop and my family will not pay any tax for three generations.”

You’re in a 33.33% tax bracket and convert the $300,000 in your traditional self-directed IRA to a Roth IRA and owe $100,000 from this conversion. But you buy a $300,000 combine machine for your upcoming harvest before the end of the year, place it in service, and deduct the full price, offsetting the $300,000 of taxable income from the Roth IRA conversion.

“I gladly accept your offer,” you say.

Follow AdviceIQ on Twitter at @adviceiq.

Dr. Harold Wong earned his Ph.D. in economics from UC Berkeley and passed the CPA exam in 1979. He has appeared on more than 400 television and radio programs and published numerous articles in 1,600 newspapers. He writes the column on money for The Arizona Republic, the largest daily newspaper in Arizona, where this article originally appeared in different form. Dr. Wong is a tax advisor and financial educator. He can be reached at (480) 706-0177, haroldwong1@yahoo.com, or www.drharoldwong.com.You can find much of his archived research at www.DrWongInvestorGuide.com.

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

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Many boomers keep most savings in either 401(k) plans or traditional individual retirement accounts. If you’re in this generation, born between 1946 and 1964 and with a few working years remaining before retirement, consider converting your IRA to a Roth.

With a traditional IRA, you get a tax break on your contributions in the current year and in retirement your withdrawals incur income tax. With a Roth IRA, you get no income tax deduction on plan contributions, but your investment earnings and withdrawals incur no income taxes.

Roth IRAs do come with restrictions. Your contributions are limited to $5,500 a year ($6,500 if you’re 50 or older), but if your modified adjusted gross income is too high in 2015 ($193,000 for married, filing jointly, and $131,000 for single) you cannot contribute to a Roth IRA. However, there are no income limits that prevent any amount of Roth IRA conversions. You must be at least age 59½ when you begin taking withdrawals from the Roth and you can’t withdraw money until you participate in at least one Roth IRA plan for at least five years.

Though most tax-sheltered plans require you start required minimum distribution (RMD) withdrawals no later than age 70½, Roth IRAs do not require RMDs.

Perhaps the easiest way to think of the advantages of such a conversion is to imagine you are a farmer. It’s early March, and you hear a knock at the front porch door.

“Hello,” says the man at the door, “I’m from the Internal Revenue Service and I’m here to help you. The federal government is experimenting with a new tax system. We can go right now to your barn and take the physical weight of your seed corn that you plan to plant next month. I will then tax you on its value in 2015.”

“Its value is $300,000,” you say.

“If you take that choice,” the man adds, “no matter how much corn you grow on your farm now and in the years ahead, there will be no tax after 2015 for the next three generations.”

You stand there in silence, trying to understand. The IRS man continues: “I know that farmers are very conservative. You probably don’t want to try a tax system that is something different.

“If you stay with the current tax system, I will come back at the end of this year’s harvest and tax you on the value of the physical weight of the mature corn kernels, the corn cob and the stalk. In fact, I will tax you on every harvest that this farm produces as long as your family owns this farm.”

You realize that the physical weight of the corn seed right now is far less than the total weight of the corn at harvest, and that the total weight of future harvests will be enormous and will be taxed for the next 80-plus years. You tell the IRS man:

“I understand that you think that the physical weight of all this seed, held in a self-directed IRA, is worth $300,000. If I convert this to a Roth IRA, you will tax me on $300,000 and never come back. Over the next 80 years, this farm will produce $300 million worth of corn crop and my family will not pay any tax for three generations.”

You’re in a 33.33% tax bracket and convert the $300,000 in your traditional self-directed IRA to a Roth IRA and owe $100,000 from this conversion. But you buy a $300,000 combine machine for your upcoming harvest before the end of the year, place it in service, and deduct the full price, offsetting the $300,000 of taxable income from the Roth IRA conversion.

“I gladly accept your offer,” you say.

Follow AdviceIQ on Twitter at @adviceiq.

Dr. Harold Wong earned his Ph.D. in economics from UC Berkeley and passed the CPA exam in 1979. He has appeared on more than 400 television and radio programs and published numerous articles in 1,600 newspapers. He writes the column on money for The Arizona Republic, the largest daily newspaper in Arizona, where this article originally appeared in different form. Dr. Wong is a tax advisor and financial educator. He can be reached at (480) 706-0177, haroldwong1@yahoo.com, or www.drharoldwong.com.You can find much of his archived research at www.DrWongInvestorGuide.com.

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

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Vilas Van Slooten http://mcrecord.com/2015/06/30/vilas-van-slooten/ http://mcrecord.com/2015/06/30/vilas-van-slooten/#comments Tue, 30 Jun 2015 18:09:55 +0000 http://mcrecord.com/?p=577919 Vilas   Van Slooten

Vilas Van Slooten, 61- year-old resident of Little Falls, died Sunday, June 28, 2015, at the St. Cloud Hospital.
A visitation will be held from 5 p.m.- 8 p.m. Wednesday, July 1 at the Emblom-Brenny Funeral Service in Little Falls. This will be a visitation only no funeral service. The family will have a private family burial.
Vilas Van Slooten was born Nov. 25, 1953, in Springfield, to Andrew and Helen (Castle) Van Slooten. He attended school in Redwood Falls and graduated with the class of 1972. Vilas was united in marriage to Gail Weedman, June 10, 1972, in Redwood Falls. The couple made their home in Redwood Falls, where Vilas was the general manager and part owner for KLGR Radio until 1988. He then went to work for the following radio stations in sales; KMOJ Radio in Marshall, KOOL FM in Minot, N.D., and KSOH FM in Cambridge. He then moved his family to Little Falls, in 1994, where he worked for KLTF as an announcer and in sales until 1998. Vilas then went to work for Monahan's Sales and Service and Falls GM in Little Falls. He most recently worked in sales for Franklin Outdoor Advertising. Vilas enjoyed aviation, computers, being on the water especially the ocean in Florida, the Minnesota Twins, golfing with family and friends and spending time with his grandchildren.
Left to cherish his memory are his wife, Gail Van Slooten of Little Falls; mother, Helen Van Slooten of Redwood Falls; sons, Travis (Michelle) Van Slooten of Blaine and Jeff (Christina) Van Slooten of Sartell; brothers, Ron (Colleen) Van Slooten of Willmar and Steve (Heidi) Van Slooten of Little Falls ; grandchildren, Reagan, Jack, Sam, Charlie and Leo Van Slooten.
He was preceded in death by his father, Andrew Van Slooten and a brother, Dave Van Slooten.

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Norman L. Faust http://mcrecord.com/2015/06/30/norman-l-faust/ http://mcrecord.com/2015/06/30/norman-l-faust/#comments Tue, 30 Jun 2015 18:09:43 +0000 http://mcrecord.com/?p=577916 Norman L.    Faust

Norman L. Faust, 80- year-old resident of rural Pierz, passed away Saturday, June 27, 2015, at his home. A Mass of Christian Burial will be held at 10:30 a.m. Friday, July 3, at St. Joseph's Catholic Church in Pierz, with Father Ken Popp officiating. Burial will be at St. Joseph's Parish Cemetery in Pierz. Visitation will be two hours prior to the service on Friday at the church.
Norman was born at home in Lastrup, Feb. 7, 1935, to the parents of Henry and Theresa (Jamma) Faust. Later the family moved just south of Genola. He was a graduate of the Little Falls High School in 1954. Norman took over the family farm and farmed there the rest of his life. He liked visiting with family and friends. Norman was always willing to help others. He enjoyed helping out his cousin, Elmer many times on his farm. Norman is survived by his sister, Darleen Blonigen of St. Martin; several nieces and a nephew, Florence Schefers, Wilfred (Judy) Blonigen, Shirley (Robert) Solsrud, Nancy (Blaine) Pfeiffer, Ann (Jeffrey) Soderholm and Sharon (Chad) Geist; 13 great-nieces and nephews; and four great-great nieces and nephews.
Norman was preceded in death by his parents, Henry and Theresa Faust; and brother-in-law, Raymond Blonigen.

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Mary Geisenhof http://mcrecord.com/2015/06/30/mary-geisenhof/ http://mcrecord.com/2015/06/30/mary-geisenhof/#comments Tue, 30 Jun 2015 18:09:15 +0000 http://mcrecord.com/?p=577913 Mary   Geisenhof

Mary Geisenhof, age 73, of Little Falls, passed away Friday, June 26, 2015, at her home at Highland Senior Living.
A Mass of Christian Burial will be held at 10:30 a.m. Tuesday, June 30, at Our Lady of Lourdes Catholic Church in Little Falls, with Fr. Jeremy Ploof officiating. Interment will be in the parish cemetery.
Visitation will be held from 4 p.m. – 8 p.m. Monday, June 29, at Emblom Brenny Funeral Service in Little Falls with a parish prayer service at 7:45 p.m.
Visitation will continue at the funeral home on Tuesday from 9 a.m. – 10 a.m.
Mary Kay Hollermann was born Oct. 8, 1941, in Melrose, the daughter of Norbert and Julia (Hellermann) Hollermann. She grew up on a farm and attended St. Francis High School in Little Falls. She was united in marriage to Lloyd Geisenhof, Dec. 29, 1960. Following her marriage, she lived near Swanville for a short time and then moved to Little Falls where she lived the rest of her life. Mary was mainly a housewife staying home to raise her family and later babysat for her grandchildren. She enjoyed cooking (she made the best potato salad and roast beef and gravy), camping, bingo, playing cards, watching the game channel on TV, trips to the casino, bonfires, and sitting outdoors enjoying nature. She especially enjoyed spending time with her children and grandchildren.
Left to cherish her memory are her mother, Julia Hollermann of Long Prairie; children, Norb of Little Falls, Denny (Sharon) of New Ulm, Lynn (Gary) Brau of Little Falls, Rick (Gwen) of Little Falls, Mike (Dawn) of Little Falls, Dan (Donna) of Little Falls and Mary Jane (Will) Geisenhof of Sauk Rapids; brothers, Tony (Bonnie) Hollermann of Albertville and Phil (Mary Jo) Hollermann of Sauk Centre; sisters, Carol (Bob) Heath of Aitkin, Jane (Ron) Wilkinson of Haywards Heath, England and Julie (Curt) Alveshere of Becker; 16 grandchildren and two great-grandchildren.
Mary was preceded in death by her father, Norbert; and a sister, Theresa Hetzel.

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Happiness Before Retirement http://mcrecord.com/2015/06/30/happiness-before-retirement/ http://mcrecord.com/2015/06/30/happiness-before-retirement/#comments Tue, 30 Jun 2015 16:30:19 +0000 http://mcrecord.com/?guid=fbf0a3b81a15c2f696bc43b8232d1e68 People say things like, “When I retire, I am going to be happy,” or “When I don’t have to work anymore, I will be happy.” The truth is, if you don’t think you can be happy until you retire, you won’t be.

My favorite cartoon character when I was young was Snoopy, so much so that my bedroom was filled with Snoopy. Snoopy dolls, Snoopy quotes and even Snoopy curtains. I learned how to draw Snoopy on top of his doghouse and spent many hours in art class perfecting this skill.

And my favorite quotes were always the “happiness is” quotes relating to Snoopy and all the Peanuts characters: Happiness is a warm puppy. Happiness is cookies. Happiness is a sunny day.

What is happiness to you? Does it have to depend on what stage of life you are in and whether you are retired?

There are a number of studies about happiness in retirement. Many people who are getting ready to retire hope that this new phase of their lives results in happiness. In fact, a lot of retirement planning focuses on how to achieve happiness in the golden years.

But more often, if you are miserable now, you most likely will be miserable in retirement. Happiness does not just happen when you stop working.

In studies conducted at the University of Pennsylvania, researchers found that there isn’t one element in the pursuit of happiness but five. They work together to contribute to an overall sense of peace and contentment.

At any age, including retirement age, the five keys to what lead researcher Martin Seligman called authentic happiness are:

Positive emotion. They are, for example, hope, enthusiasm and warmth. A large part of positive psychology, a field of study that seeks to understand happiness, is about enhancing these emotions.

Engagement. People who engage in activities they enjoy are happier. Retirement does help you in this area since it frees up your time to do things you like.

Relationships. Families, friends and healthy social contact are essential for happiness. You should work on bettering your relationships before retirement begins, because leaving your job sometimes means leaving long-time friends at work.

Meaning. Retirement is the time to look at the meaning of life. As you approach retirement, determine what you can do to feel fulfilled. Do not wait until you retire to figure this out.

Achievement. Those with a positive self-image are happier. If your job doesn’t give you a sense of achievement, try getting involved in other activities that do. Volunteer work? Sports? Quilting? This is even more important in retirement.

The ability to enjoy our golden years is the same ability to be happy at all the stages of our life. So, what are the answers to your “happiness is”?

Follow AdviceIQ on Twitter at @adviceiq.

Maureen Crimmins is the co-founder of Crimmins Wealth Management LLC in Woodcliff Lake, N.J. Her websites are www.CrimminsWM.com and www.RootsofWealth.com.

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

 

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People say things like, “When I retire, I am going to be happy,” or “When I don’t have to work anymore, I will be happy.” The truth is, if you don’t think you can be happy until you retire, you won’t be.

My favorite cartoon character when I was young was Snoopy, so much so that my bedroom was filled with Snoopy. Snoopy dolls, Snoopy quotes and even Snoopy curtains. I learned how to draw Snoopy on top of his doghouse and spent many hours in art class perfecting this skill.

And my favorite quotes were always the “happiness is” quotes relating to Snoopy and all the Peanuts characters: Happiness is a warm puppy. Happiness is cookies. Happiness is a sunny day.

What is happiness to you? Does it have to depend on what stage of life you are in and whether you are retired?

There are a number of studies about happiness in retirement. Many people who are getting ready to retire hope that this new phase of their lives results in happiness. In fact, a lot of retirement planning focuses on how to achieve happiness in the golden years.

But more often, if you are miserable now, you most likely will be miserable in retirement. Happiness does not just happen when you stop working.

In studies conducted at the University of Pennsylvania, researchers found that there isn’t one element in the pursuit of happiness but five. They work together to contribute to an overall sense of peace and contentment.

At any age, including retirement age, the five keys to what lead researcher Martin Seligman called authentic happiness are:

Positive emotion. They are, for example, hope, enthusiasm and warmth. A large part of positive psychology, a field of study that seeks to understand happiness, is about enhancing these emotions.

Engagement. People who engage in activities they enjoy are happier. Retirement does help you in this area since it frees up your time to do things you like.

Relationships. Families, friends and healthy social contact are essential for happiness. You should work on bettering your relationships before retirement begins, because leaving your job sometimes means leaving long-time friends at work.

Meaning. Retirement is the time to look at the meaning of life. As you approach retirement, determine what you can do to feel fulfilled. Do not wait until you retire to figure this out.

Achievement. Those with a positive self-image are happier. If your job doesn’t give you a sense of achievement, try getting involved in other activities that do. Volunteer work? Sports? Quilting? This is even more important in retirement.

The ability to enjoy our golden years is the same ability to be happy at all the stages of our life. So, what are the answers to your “happiness is”?

Follow AdviceIQ on Twitter at @adviceiq.

Maureen Crimmins is the co-founder of Crimmins Wealth Management LLC in Woodcliff Lake, N.J. Her websites are www.CrimminsWM.com and www.RootsofWealth.com.

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

 

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Former Shopper owner celebrates 105th Birthday http://mcrecord.com/2015/06/30/former-shopper-owner-celebrates-105th-birthday/ http://mcrecord.com/2015/06/30/former-shopper-owner-celebrates-105th-birthday/#comments Tue, 30 Jun 2015 13:02:27 +0000 http://mcrecord.com/?p=577897 By Gabby LandsverkStaff Writer

Betty Hovet, of Little Falls, recently turned 105 and has no complaints, other than the challenge of having to count that many candles on her birthday cake.

Betty Hovet, of Little Falls, celebrated her 105th birthday June 27. Hovet, along with her husband Ken, formerly printed the twice- weekly newspaper, the Little Falls Shopper, and is shown above with one of the few remaining copies.

Betty Hovet, of Little Falls, celebrated her 105th birthday June 27. Hovet, along with her husband Ken, formerly printed the twice- weekly newspaper, the Little Falls Shopper, and is shown above with one of the few remaining copies.

“I can’t keep track anymore,” Hovet said with a laugh.

Hovet was born in 1910 Aden, S.D.,  with a midwife, but no doctors, assisting. She spent her childhood living on a farm.

Hovet later moved to Minnesota with her husband, Ken. The two met while she was working at a restaurant across the street from the print shop where he worked.

The couple moved to Little Falls in 1931 and bought the local printing shop. The Hovets made a living printing wedding invitations and similar items, along with the Little Falls Shopper.

A twice-weekly newspaper, the Shopper had a circulation of about 1,400 homes and businesses, Hovet said.

Doris Miller, Hovet’s only child, said that Hovet kept the print and newspaper business going by herself while Ken was serving in the Navy.

“My mother kept that business running,” Miller said.

OldShopper

The Shopper informed Little Falls about local bargains and events until 1972 when the Hovets retired.

 

Although Hovet has trouble remembering all the details of her exceptionallylong life, Miller looks back fondly on the past.

“I had a good childhood,” Miller said. “My parents were always there for me.”

The family spent time in Texas and at the lake after they sold the business.

Ken passed away in 1991, after which Hovet lived alone for many years but had, and has, many friends and stayed busy volunteering and making  crafts. She also enjoys

A photograph of Betty Hovet as a young woman

A photograph of Betty Hovet as a young woman

playing cards.

Hovet’s secret to longevity, she said, was that she never dieted, but always ate whatever she wanted to.

“If I didn’t like it, I didn’t eat it,” Hovet said.

Otherwise, she said there is no secret to aging gracefully; it was easy for her.

“No problem. No aches,” Hovet said, of reaching 105.

Miller said that they marked the occasion with a cake and a quiet celebration.

“She’s very content,” Miller said. “She (once) made the remark ‘Life has many stages, and you have to adjust to each one of them.’ And that she does.”

 

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The Market Rally Quiz http://mcrecord.com/2015/06/30/the-market-rally-quiz/ http://mcrecord.com/2015/06/30/the-market-rally-quiz/#comments Tue, 30 Jun 2015 13:00:34 +0000 http://mcrecord.com/?guid=f3b750da639ff1b2507920e4992c85c0 Although the stock market hasn’t advanced much this year and is ebbing lately (especially yesterday), it still has hit new highs. Considering that economic news is up and down, why is that? Let’s take a simple quiz and answer the following multiple-choice question.

The stock market is hitting new highs because:

  1. Corporate earnings are at an all-time high.
  2. The economy is recovering.
  3. The Federal Reserve is manipulating the market.
  4. Investors lack common sense.

Corporate earnings are supposed to drive stock prices. That used to be true, before the market became dysfunctional because of the Fed’s artificial stimulus, high-frequency trading, overbearing regulations and other factors. It’s not true anymore. At least not now. 

The stock market has set records even though Standard & Poor’s 500 company earnings declined 13% in the first quarter of 2015, according to New York investment advisor Pension Partners.

As our friend Charlie Bilello of Pension Partners pointed out on the Contra Corner website, six out of the 10 major S&P 500 sectors showed year-over-year declines, including consumer sectors, which were supposed to have benefited most from a decline in gas prices.

So if you answered “A,” go to the back of the class.

If you answered “B,” join your friends who answered “A,” as you’re both wrong. And if you answered “B,” you’re probably not a regular reader of these posts, as we’ve pointed out that unemployment is much higher than it used to be, personal income is down, the housing market hasn’t recovered, economic growth has flatlinedgovernment and consumer debt are out of control, and the world is coming to an end.

We don’t really think the world is coming to an end, but the economy is obviously not in the state of bliss that many media, politicians and pundits would have us believe. If the evidence above isn’t enough for you, consider the following from the Fed’s 2014 household survey:

  • Nearly half of the respondents wouldn’t be able to cover an emergency $400 expense without selling something or borrowing money. When did the U.S. become a Third World country?
  • About 31% of non-retirees have no retirement savings or pension, including one-quarter of people over the age of 45. About 28% of people who plan to retire said they plan to work to age 70 or later.
  • Nearly a third of respondents had to forgo some medical treatment in the past year because they couldn’t afford it.
  • About 81% of renters said that they would own their home if they could afford one, yet 50% can’t even afford a down payment and 31% said they couldn’t qualify for a mortgage.
  • In spite of increases in housing prices, 14% of respondents with mortgages said they owe more than their home is worth.

So, to answer the question above, we’d go with C or D; maybe both. Defending our position, note that the Consumer Confidence Index rose in May (albeit, the rise was moderate and it was preceded by three months of decline).

As for the Fed’s role, Bilello wrote that, “Buyers and sellers have become fixated on one fact and one fact alone: easy monetary policy. While earnings and economic data have been weak in 2015, the Federal Reserve has responded by becoming increasingly dovish.

“Expectations for the long-awaited rate hike off 0% have been pushed all back to December, with Fed Fund futures now predicting there is only a 50% probability of that occurring. We are only a hair’s breadth away from expectations moving to 2016.”

So … no interest rate hike until 2016? Where did you first hear that prediction? Yours truly said as much in February. Of course, we’d rather be right than first.

Question 2 in our quiz:

When the Fed finally gets around to raising interest rates after nearly seven years of ZIRP (zero interest rate policy), the impact on the stock market will be:

  1. Negligible, as investors know it’s coming and it’s been factored into stock prices.
  2. Catastrophic, as low rates will no longer be propping up the market.
  3. Bearish, as the market adjusts to reality.
  4. Who knows? Investors should be expecting a rate increase, but with the market setting new records, they’re clearly looking short term.

We’ll go with “D” on this one, but we’d choose “C” if we didn’t have an opportunity to cop out. The asset bubble is likely to burst as some point and investors should be prepared for it.

Follow AdviceIQ on Twitter at @adviceiq.

Brenda P. Wenning is president of Wenning Investments LLC in Newton, Mass. 

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

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Although the stock market hasn’t advanced much this year and is ebbing lately (especially yesterday), it still has hit new highs. Considering that economic news is up and down, why is that? Let’s take a simple quiz and answer the following multiple-choice question.

The stock market is hitting new highs because:

  1. Corporate earnings are at an all-time high.
  2. The economy is recovering.
  3. The Federal Reserve is manipulating the market.
  4. Investors lack common sense.

Corporate earnings are supposed to drive stock prices. That used to be true, before the market became dysfunctional because of the Fed’s artificial stimulus, high-frequency trading, overbearing regulations and other factors. It’s not true anymore. At least not now. 

The stock market has set records even though Standard & Poor’s 500 company earnings declined 13% in the first quarter of 2015, according to New York investment advisor Pension Partners.

As our friend Charlie Bilello of Pension Partners pointed out on the Contra Corner website, six out of the 10 major S&P 500 sectors showed year-over-year declines, including consumer sectors, which were supposed to have benefited most from a decline in gas prices.

So if you answered “A,” go to the back of the class.

If you answered “B,” join your friends who answered “A,” as you’re both wrong. And if you answered “B,” you’re probably not a regular reader of these posts, as we’ve pointed out that unemployment is much higher than it used to be, personal income is down, the housing market hasn’t recovered, economic growth has flatlinedgovernment and consumer debt are out of control, and the world is coming to an end.

We don’t really think the world is coming to an end, but the economy is obviously not in the state of bliss that many media, politicians and pundits would have us believe. If the evidence above isn’t enough for you, consider the following from the Fed’s 2014 household survey:

  • Nearly half of the respondents wouldn’t be able to cover an emergency $400 expense without selling something or borrowing money. When did the U.S. become a Third World country?
  • About 31% of non-retirees have no retirement savings or pension, including one-quarter of people over the age of 45. About 28% of people who plan to retire said they plan to work to age 70 or later.
  • Nearly a third of respondents had to forgo some medical treatment in the past year because they couldn’t afford it.
  • About 81% of renters said that they would own their home if they could afford one, yet 50% can’t even afford a down payment and 31% said they couldn’t qualify for a mortgage.
  • In spite of increases in housing prices, 14% of respondents with mortgages said they owe more than their home is worth.

So, to answer the question above, we’d go with C or D; maybe both. Defending our position, note that the Consumer Confidence Index rose in May (albeit, the rise was moderate and it was preceded by three months of decline).

As for the Fed’s role, Bilello wrote that, “Buyers and sellers have become fixated on one fact and one fact alone: easy monetary policy. While earnings and economic data have been weak in 2015, the Federal Reserve has responded by becoming increasingly dovish.

“Expectations for the long-awaited rate hike off 0% have been pushed all back to December, with Fed Fund futures now predicting there is only a 50% probability of that occurring. We are only a hair’s breadth away from expectations moving to 2016.”

So … no interest rate hike until 2016? Where did you first hear that prediction? Yours truly said as much in February. Of course, we’d rather be right than first.

Question 2 in our quiz:

When the Fed finally gets around to raising interest rates after nearly seven years of ZIRP (zero interest rate policy), the impact on the stock market will be:

  1. Negligible, as investors know it’s coming and it’s been factored into stock prices.
  2. Catastrophic, as low rates will no longer be propping up the market.
  3. Bearish, as the market adjusts to reality.
  4. Who knows? Investors should be expecting a rate increase, but with the market setting new records, they’re clearly looking short term.

We’ll go with “D” on this one, but we’d choose “C” if we didn’t have an opportunity to cop out. The asset bubble is likely to burst as some point and investors should be prepared for it.

Follow AdviceIQ on Twitter at @adviceiq.

Brenda P. Wenning is president of Wenning Investments LLC in Newton, Mass. 

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

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Duane D. Hawes http://mcrecord.com/2015/06/29/duane-d-hawes/ http://mcrecord.com/2015/06/29/duane-d-hawes/#comments Mon, 29 Jun 2015 22:12:18 +0000 http://mcrecord.com/?p=577894 obit - Hawes, Duane final rectDuane D. Hawes, an over-the-road truck driver and real estate investor, died unexpectedly Saturday, June 27, 2015, at the age of 63 at his home in Melrose.
A gathering of family and friends will be held from 11 a.m. to 12 p.m. Wednesday, July 1, at the Patton-Schad Funeral Home in Melrose. Inurnment will follow at Lake Ripley Cemetery in Litchfield.
Duane Dale Hawes was born April 30, 1952, in Watertown, to Dale and Arlene (Nystrom) Hawes. He graduated from the Anoka Technical College in Anoka with a degree in Marketing and worked hard every day, ever since. He had three children who were the most important part of his life. Duane will be deeply missed by his sons, his family, and all who knew him. He enjoyed riding his motorcycle and doing crossword puzzles. He also enjoyed buying and selling cars; always looking for a good deal.
Duane is survived by his sons, Jason (Debra) Hawes of Coon Rapids, Judd (Janice) Hawes of Bowlus and Mitchell Hawes of Albany; sister, Kathy (Tom) Frenn of St. Cloud/Arizona; brother, Gary Hawes of Litchfield; and step-grandchildren, Gage and Mandi Ylinen of Bowlus.
Duane was a most devoted father and son, and was preceded in death by his mother, Arlene Snow; father, Dale Hawes; step-mother, Eva Hawes; and step-father, Ray Snow.
Serving as urn bearers were his sons, Jason, Judd, and Mitchell.
In lieu of flowers, memorials are preferred.

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Spending Time in Retirement http://mcrecord.com/2015/06/29/spending-time-in-retirement/ http://mcrecord.com/2015/06/29/spending-time-in-retirement/#comments Mon, 29 Jun 2015 20:00:23 +0000 http://mcrecord.com/?guid=24f757568302f30d265969581bdc1d97 Every day you read headlines talking about the money you need for retirement. What happens to the rest of your life – and who you think you are – after you punch your last time clock? Here’s how to consider changes that won’t come with a dollar sign.

I just ended seven years of teaching financial planning at Purdue University. This does not mark my retirement from the financial services industry (I still have my advisory firm), but it does evoke a substantial amount of emotion. As I walked the university halls one more time, colleagues thanked me for my service and asked what I will now do in what they termed my “spare time.”

Be assured, any looming extra time was already spoken for before my resignation letter hit the department head’s desk. How to spend time in retirement looms large for anyone thinking about leaving the workforce. For many, the golden years turn out to be far more emotional than expected.

Retirement marks a closure of (you hope) happy employment memories even as it opens new opportunities. Most people who we help plan for retirement expect no problem filling days with grandchildren, hobbies, traveling and volunteer work. We find that eventually most couldn’t be more right; many of our retirees wind up wondering how they once got everything done while employed.

One frequently unexpected challenge for many retirees: the emotional space associated with the identity left behind. Men in particular (although I see both men and women affected) often align personal identity more with work performed than with financial earnings.

Self-fulfillment comes from being good at what you do, knowing the rules and ropes that come with experience and feeling confident in a day-to-day regimen that offers emotional security. The satisfaction that you derive from other people counting on your work matters more than you might think.

You can sit down with a qualified financial planner to determine when you can retire financially. You’ll make some assumptions about money and spending; wisdom and sound management help provide confidence moving forward financially after your career.

And the other parts of your new life? According to a recent article in Psychology Today, key questions about intangibles before retirement include:

1. Do you enjoy your job? Does it provide a sense of meaning and purpose in your life?

2. If your job is stressful, is it retirement you seek, or a change in careers?

3. Does your job provide critical social needs in your life?

4. Are you prepared psychologically to retire? (“Do you have a retirement plan? Do you have hobbies or interests that will fill your time?”)

The challenge of that time of life seems to involve dealing with unknowns, both financial and emotional. A few examples of post-retirement challenges we’ve observed:

  • Your spouse is used to having the house alone during the day. Suddenly your presence invades his or her space.
  • You spent your days at work making big decisions and thriving on pressure. After retirement, things you never noticed before suddenly seem urgent as your brain searches for problems needing the familiar big decisions.
  • A favorite hobby that always relaxed you no longer delivers the same sense of relief.
  • The grandchildren’s softball, soccer and other sports feel more like a full-time job than treasured moments.

Leaving your career marks not just an end but also a beginning. Happy days are ahead – if you plan.

Follow AdviceIQ on Twitter at @adviceiq.

Joseph “Big Joe” Clark, CFP, is the managing partner of the Financial Enhancement Group LLC, an SEC Registered Investment Advisory firm in Indiana. He is the host of Consider This with Big Joe Clark, found on WQME and iTunes. Big Joe can be reached at bigjoe@yourlifeafterwork.com, or (765) 640-1524. Follow him on Twitter at @Big Joe Clark and on Facebook at http://www.facebook.com/FinancialEnhancementGroup.

Securities offered through and by World Equity Group Inc. Member FINRA/SIPC. Advisory services can be offered by the Financial Enhancement Group (FEG) or World Equity Group. FEG and World Equity Group are separately owned and operated.

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

 

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Every day you read headlines talking about the money you need for retirement. What happens to the rest of your life – and who you think you are – after you punch your last time clock? Here’s how to consider changes that won’t come with a dollar sign.

I just ended seven years of teaching financial planning at Purdue University. This does not mark my retirement from the financial services industry (I still have my advisory firm), but it does evoke a substantial amount of emotion. As I walked the university halls one more time, colleagues thanked me for my service and asked what I will now do in what they termed my “spare time.”

Be assured, any looming extra time was already spoken for before my resignation letter hit the department head’s desk. How to spend time in retirement looms large for anyone thinking about leaving the workforce. For many, the golden years turn out to be far more emotional than expected.

Retirement marks a closure of (you hope) happy employment memories even as it opens new opportunities. Most people who we help plan for retirement expect no problem filling days with grandchildren, hobbies, traveling and volunteer work. We find that eventually most couldn’t be more right; many of our retirees wind up wondering how they once got everything done while employed.

One frequently unexpected challenge for many retirees: the emotional space associated with the identity left behind. Men in particular (although I see both men and women affected) often align personal identity more with work performed than with financial earnings.

Self-fulfillment comes from being good at what you do, knowing the rules and ropes that come with experience and feeling confident in a day-to-day regimen that offers emotional security. The satisfaction that you derive from other people counting on your work matters more than you might think.

You can sit down with a qualified financial planner to determine when you can retire financially. You’ll make some assumptions about money and spending; wisdom and sound management help provide confidence moving forward financially after your career.

And the other parts of your new life? According to a recent article in Psychology Today, key questions about intangibles before retirement include:

1. Do you enjoy your job? Does it provide a sense of meaning and purpose in your life?

2. If your job is stressful, is it retirement you seek, or a change in careers?

3. Does your job provide critical social needs in your life?

4. Are you prepared psychologically to retire? (“Do you have a retirement plan? Do you have hobbies or interests that will fill your time?”)

The challenge of that time of life seems to involve dealing with unknowns, both financial and emotional. A few examples of post-retirement challenges we’ve observed:

  • Your spouse is used to having the house alone during the day. Suddenly your presence invades his or her space.
  • You spent your days at work making big decisions and thriving on pressure. After retirement, things you never noticed before suddenly seem urgent as your brain searches for problems needing the familiar big decisions.
  • A favorite hobby that always relaxed you no longer delivers the same sense of relief.
  • The grandchildren’s softball, soccer and other sports feel more like a full-time job than treasured moments.

Leaving your career marks not just an end but also a beginning. Happy days are ahead – if you plan.

Follow AdviceIQ on Twitter at @adviceiq.

Joseph “Big Joe” Clark, CFP, is the managing partner of the Financial Enhancement Group LLC, an SEC Registered Investment Advisory firm in Indiana. He is the host of Consider This with Big Joe Clark, found on WQME and iTunes. Big Joe can be reached at bigjoe@yourlifeafterwork.com, or (765) 640-1524. Follow him on Twitter at @Big Joe Clark and on Facebook at http://www.facebook.com/FinancialEnhancementGroup.

Securities offered through and by World Equity Group Inc. Member FINRA/SIPC. Advisory services can be offered by the Financial Enhancement Group (FEG) or World Equity Group. FEG and World Equity Group are separately owned and operated.

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

 

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Quinten Rahn http://mcrecord.com/2015/06/29/quinten-rahn/ http://mcrecord.com/2015/06/29/quinten-rahn/#comments Mon, 29 Jun 2015 18:10:46 +0000 http://mcrecord.com/?p=577889 Quinten Rahn

Quinten Jerry Rahn was born to Taylor VanNorman and Nick Rahn of Long Prairie, June 24, 2015, at 3:39 p.m. at CentraCare Health-Long Prairie. He weighed 8.5 pounds.
Quinten will be welcomed home by his siblings, Aleigha Pohlman and Dylan and Alison Rahn.
Grandparents are Jerry and MerryKay Rahn, Jennifer and Michael Steinmetz and Greg and Michelle Christopher.

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Grace Imholte http://mcrecord.com/2015/06/29/grace-imholte/ http://mcrecord.com/2015/06/29/grace-imholte/#comments Mon, 29 Jun 2015 18:10:39 +0000 http://mcrecord.com/?p=577886 Grace Nicole Imholte was born to Jeremy and Kassy Imholte of Buckman, June 12, 2015, at 4:19 p.m. at St. Gabriel's Hospital. She weighed 7 pounds, 13 ounces and was 19 inches long.
Grandparents are Larry and Diane Hagadorn of Annandale, Jim and Jean Fraser of Clearwater and Mark Imholte of WY.

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Class of 2015, What’s Next? http://mcrecord.com/2015/06/29/class-of-2015-whats-next/ http://mcrecord.com/2015/06/29/class-of-2015-whats-next/#comments Mon, 29 Jun 2015 17:00:28 +0000 http://mcrecord.com/?guid=fe09b1444030cd405fe7679f31a66d57 The graduation parties are over. Your diploma is at the frame shop. Now what? What’s next in your life transition? College, graduate school, a job, the military? What is your strategy for moving forward with passion and purpose?

In his 2001 bestseller, author John Ortberg detailed a secret to success reflected in the title of his book, If You Want to Walk on Water, You’ve Got to Get Out of the Boat. A mega-church pastor, Ortberg frames faith in God as a key aspect of progress and recovery from setbacks and failure. “The boat” represents safety and security in uncertain and potentially turbulent seas. Ask yourself, “What produces fear in me, especially when I think of leaving the boat and stepping out in faith?”

Faith in God is important, but you must have faith in yourself, approaching life realistically, recognizing that success, however you define it, is a do-it-yourself-project. As political battles deepen you will hear about fairness, about entitlements, about sensitivity and not offending anyone.

Actor Matthew McConaughey in a graduation address at the University of Houston dropped a nugget of realism on the Class of 2015: “Life is not easy ... don’t try and make it that way. It’s not fair, it never was, it isn’t now, it won’t ever be. Do not fall into the entitlement trap of feeling you are a victim. You are not. Get over it and get on with it. And, yes, most things are more rewarding when you break a sweat to get ‘em.”

Climbing out of your boat entails risk. In investing and in life, risk and reward go together. You will not reach financial independence and self-actualization without taking risks. Atlanta-based entrepreneur Michael J. Coles is a case in point. Raised in humble circumstances, Coles went on to become a successful business leader and philanthropist. The Kennesaw State University Michael J. Coles College of Business bears his name.

After starting in the clothing business, in 1977 Michael and a friend had an idea for a cookie store. While neither had experience in food service, they knew how to make great cookies. But they couldn’t find a shopping mall that would take a chance on them and rent space. Perimeter Mall, just off of I-285 in the northern Atlanta suburbs, was their desired location.

Although mall management initially brushed them off, they persisted. Told the rent would be $25,000 per year on a 10-year lease, totaling $250,000, the manager said, “Do you know how many cookies you have to sell just to pay the rent?”

Think about that. You and your partner have a great idea but no experience with a single-theme food concept, no market as yet, no track record. You are married with family obligations, bills to pay. You each kick in $4,000 in seed money to get started ($16,138 in today’s dollars). When told of the rent obligation for which you will have personal liability, a shiver of fear grips your psyche. In 1977 dollars adjusted for inflation, $25,000 per year in rent is $100,864 today; $250,000 in total obligation represents just over $1 million in 2015 dollars.

Sure, cookies are tasty, but the mall manager has a point: Coles had to sell enough to pay rent, buy supplies and equipment, pay help and make sufficient profit to support his family. It takes a unique individual to step out and take a leap of faith. The 1977 opening day of The Great American Cookie Company was a disaster. The cookies in the baking oven caught fire, filling the store and mall area with smoke as the fire department rolled up. The second day was much better.

Six weeks after opening the first store, Michael was in a near-fatal motorcycle accident. Told he would never walk again unaided, he thought, “I was disabled not just in my legs, but in my mind.”

Determined to overcome, he took charge of his therapy, eventually setting two cross-country cycling records. Failure and setbacks are part of success. The company was sold in 1998 when multiple store sales exceeded $100 million per year. Coles went on to found and revive other companies in diverse fields, noting that each setback, in business and personally, motivated him to re-energize and take life to the next level.

You, dear graduate, will not walk across the water to the beach unless you get out of the boat. Actually, there is no beach, just a fast-moving current. You must find the courage and energy to keep swimming! May the gift of faith be yours.

Follow AdviceIQ on Twitter at @adviceiq

Lewis Walker, CFP, is president of Walker Capital Management, LCC in Peachtree Corners, Ga. Securities and certain advisory services offered through The Strategic Financial Alliance Inc. (SFA). Lewis Walker is a registered representative of The SFA, which is otherwise unaffiliated with Walker Capital Management. 770-441-2603. lewisw@theinvestmentcoach.com.

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

 

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The graduation parties are over. Your diploma is at the frame shop. Now what? What’s next in your life transition? College, graduate school, a job, the military? What is your strategy for moving forward with passion and purpose?

In his 2001 bestseller, author John Ortberg detailed a secret to success reflected in the title of his book, If You Want to Walk on Water, You’ve Got to Get Out of the Boat. A mega-church pastor, Ortberg frames faith in God as a key aspect of progress and recovery from setbacks and failure. “The boat” represents safety and security in uncertain and potentially turbulent seas. Ask yourself, “What produces fear in me, especially when I think of leaving the boat and stepping out in faith?”

Faith in God is important, but you must have faith in yourself, approaching life realistically, recognizing that success, however you define it, is a do-it-yourself-project. As political battles deepen you will hear about fairness, about entitlements, about sensitivity and not offending anyone.

Actor Matthew McConaughey in a graduation address at the University of Houston dropped a nugget of realism on the Class of 2015: “Life is not easy ... don’t try and make it that way. It’s not fair, it never was, it isn’t now, it won’t ever be. Do not fall into the entitlement trap of feeling you are a victim. You are not. Get over it and get on with it. And, yes, most things are more rewarding when you break a sweat to get ‘em.”

Climbing out of your boat entails risk. In investing and in life, risk and reward go together. You will not reach financial independence and self-actualization without taking risks. Atlanta-based entrepreneur Michael J. Coles is a case in point. Raised in humble circumstances, Coles went on to become a successful business leader and philanthropist. The Kennesaw State University Michael J. Coles College of Business bears his name.

After starting in the clothing business, in 1977 Michael and a friend had an idea for a cookie store. While neither had experience in food service, they knew how to make great cookies. But they couldn’t find a shopping mall that would take a chance on them and rent space. Perimeter Mall, just off of I-285 in the northern Atlanta suburbs, was their desired location.

Although mall management initially brushed them off, they persisted. Told the rent would be $25,000 per year on a 10-year lease, totaling $250,000, the manager said, “Do you know how many cookies you have to sell just to pay the rent?”

Think about that. You and your partner have a great idea but no experience with a single-theme food concept, no market as yet, no track record. You are married with family obligations, bills to pay. You each kick in $4,000 in seed money to get started ($16,138 in today’s dollars). When told of the rent obligation for which you will have personal liability, a shiver of fear grips your psyche. In 1977 dollars adjusted for inflation, $25,000 per year in rent is $100,864 today; $250,000 in total obligation represents just over $1 million in 2015 dollars.

Sure, cookies are tasty, but the mall manager has a point: Coles had to sell enough to pay rent, buy supplies and equipment, pay help and make sufficient profit to support his family. It takes a unique individual to step out and take a leap of faith. The 1977 opening day of The Great American Cookie Company was a disaster. The cookies in the baking oven caught fire, filling the store and mall area with smoke as the fire department rolled up. The second day was much better.

Six weeks after opening the first store, Michael was in a near-fatal motorcycle accident. Told he would never walk again unaided, he thought, “I was disabled not just in my legs, but in my mind.”

Determined to overcome, he took charge of his therapy, eventually setting two cross-country cycling records. Failure and setbacks are part of success. The company was sold in 1998 when multiple store sales exceeded $100 million per year. Coles went on to found and revive other companies in diverse fields, noting that each setback, in business and personally, motivated him to re-energize and take life to the next level.

You, dear graduate, will not walk across the water to the beach unless you get out of the boat. Actually, there is no beach, just a fast-moving current. You must find the courage and energy to keep swimming! May the gift of faith be yours.

Follow AdviceIQ on Twitter at @adviceiq

Lewis Walker, CFP, is president of Walker Capital Management, LCC in Peachtree Corners, Ga. Securities and certain advisory services offered through The Strategic Financial Alliance Inc. (SFA). Lewis Walker is a registered representative of The SFA, which is otherwise unaffiliated with Walker Capital Management. 770-441-2603. lewisw@theinvestmentcoach.com.

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

 

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Funds: Similar; Results: Not http://mcrecord.com/2015/06/29/funds-similar-results-not/ http://mcrecord.com/2015/06/29/funds-similar-results-not/#comments Mon, 29 Jun 2015 14:00:03 +0000 http://mcrecord.com/?guid=5d9a5d066a44825ac597a943d572c7ec Fortunes change for mutual funds, even the best ones. That’s true for funds that seem to be alike. Subtle differences, however, can spell a noteworthy divergence in performance. A case in point is the contrast between good funds from Dimensional Fund Advisors and Vanguard Investments.

Recently, the difference in historical performance between DFA U.S. Small Value (DFSVX) and Vanguard Small Cap Value (VISVX) has narrowed. For example, for the 10-year period ending December 2014, the compound annual return of DFSVX was 7.9%, while VISVX earned 8.3%. Comparatively, for the 10 years ending December 2012, returns were 11.3% for DFSVX and 9.6% for VISVX.

What explains this reversal? It’s not so much their costs. The DFA fund is slightly more expensive to run than the Vanguard offering (charging investors 0.53% of assets yearly, versus 0.23%), but the difference isn’t very wide and both are relatively cheap. What separates them is their asset allocation.

From January 2003 through December 2012, an analysis shows the two funds had roughly comparable concentrations in value stocks, which trade at a lower price than their fundamentals warrant. But DFSVX had markedly higher exposure to market risk – meaning its holdings were more vulnerable to volatility – and owned much smaller companies.

Both the equity market and small-cap stocks did exceedingly well during the earlier timespan, with an average annual equity risk premium – stocks’ extra performance over risk-free Treasury bonds – of 8 percentage points and a 4.3 percentage point size premium, which is how much small stocks exceed large. So it’s not surprising to see that DFA Small Value had substantially higher performance than Vanguard Small Value for the 2012-ending period.

From January 2005 through December 2014, an analysis shows exactly what we found in the earlier period: DFSVX had markedly higher exposure to market risk and small-cap risk than VISVX. Both the market premium and size premium were positive over this period, albeit the average annual size premium was just 1.0 percentage point. What explains the slightly lower returns of DFSVX compared with VISVX?

First, it’s worth noting that the average annual returns of DFSVX were slightly higher than VISVX, but the compound returns were lower due to the higher volatility of DFSVX (24.2% volatility). That’s in contrast to VISVX’s 20.5%.

The primary explanation for the performance differential was that the higher volatility of DFSVX compared with VISVX more than offset the incremental return benefit of having more exposure to market risk and small-cap risk. In periods such as 2003–2012 when the size premium was closer to its historical average, the additional volatility does not tend to offset the higher average annual returns.

Second, DFA Small Value excludes both real estate investment trusts, which are pools of properties or mortgages that trade like stocks, and highly regulated utilities, while Vanguard Small Value does not.

Over this later 10-year period, both REITs (using the Dow Jones U.S. Select REIT Index) and utilities (using economist Ken French’s utilities industry series) had higher returns than Vanguard Small Value itself, indicating that this is likely another explanatory factor.

The higher returns of these two sectors, which are frequently a substantial portion of VISVX’s portfolio, likely pulled VISVX’s returns up relative to what they would have been had Vanguard followed the same sector-exclusion methodology as DFA.

Follow AdviceIQ on Twitter at @adviceiq.

Jared Kizer is the director of investment strategy for the BAM ALLIANCE, a community of more than 140 independent wealth management firms located throughout the United States. See its disclosures page for more information. Follow him on Twitter at twitter.com/JaredKizer. A St. Louis resident, Jared co-authored the book The Only Guide to Alternative Investments You’ll Ever Need in 2008 with financial author Larry Swedroe. To learn more about the BAM Alliance or to find an independent member firm, please visit www.TheBAMAlliance.com.

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

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Fortunes change for mutual funds, even the best ones. That’s true for funds that seem to be alike. Subtle differences, however, can spell a noteworthy divergence in performance. A case in point is the contrast between good funds from Dimensional Fund Advisors and Vanguard Investments.

Recently, the difference in historical performance between DFA U.S. Small Value (DFSVX) and Vanguard Small Cap Value (VISVX) has narrowed. For example, for the 10-year period ending December 2014, the compound annual return of DFSVX was 7.9%, while VISVX earned 8.3%. Comparatively, for the 10 years ending December 2012, returns were 11.3% for DFSVX and 9.6% for VISVX.

What explains this reversal? It’s not so much their costs. The DFA fund is slightly more expensive to run than the Vanguard offering (charging investors 0.53% of assets yearly, versus 0.23%), but the difference isn’t very wide and both are relatively cheap. What separates them is their asset allocation.

From January 2003 through December 2012, an analysis shows the two funds had roughly comparable concentrations in value stocks, which trade at a lower price than their fundamentals warrant. But DFSVX had markedly higher exposure to market risk – meaning its holdings were more vulnerable to volatility – and owned much smaller companies.

Both the equity market and small-cap stocks did exceedingly well during the earlier timespan, with an average annual equity risk premium – stocks’ extra performance over risk-free Treasury bonds – of 8 percentage points and a 4.3 percentage point size premium, which is how much small stocks exceed large. So it’s not surprising to see that DFA Small Value had substantially higher performance than Vanguard Small Value for the 2012-ending period.

From January 2005 through December 2014, an analysis shows exactly what we found in the earlier period: DFSVX had markedly higher exposure to market risk and small-cap risk than VISVX. Both the market premium and size premium were positive over this period, albeit the average annual size premium was just 1.0 percentage point. What explains the slightly lower returns of DFSVX compared with VISVX?

First, it’s worth noting that the average annual returns of DFSVX were slightly higher than VISVX, but the compound returns were lower due to the higher volatility of DFSVX (24.2% volatility). That’s in contrast to VISVX’s 20.5%.

The primary explanation for the performance differential was that the higher volatility of DFSVX compared with VISVX more than offset the incremental return benefit of having more exposure to market risk and small-cap risk. In periods such as 2003–2012 when the size premium was closer to its historical average, the additional volatility does not tend to offset the higher average annual returns.

Second, DFA Small Value excludes both real estate investment trusts, which are pools of properties or mortgages that trade like stocks, and highly regulated utilities, while Vanguard Small Value does not.

Over this later 10-year period, both REITs (using the Dow Jones U.S. Select REIT Index) and utilities (using economist Ken French’s utilities industry series) had higher returns than Vanguard Small Value itself, indicating that this is likely another explanatory factor.

The higher returns of these two sectors, which are frequently a substantial portion of VISVX’s portfolio, likely pulled VISVX’s returns up relative to what they would have been had Vanguard followed the same sector-exclusion methodology as DFA.

Follow AdviceIQ on Twitter at @adviceiq.

Jared Kizer is the director of investment strategy for the BAM ALLIANCE, a community of more than 140 independent wealth management firms located throughout the United States. See its disclosures page for more information. Follow him on Twitter at twitter.com/JaredKizer. A St. Louis resident, Jared co-authored the book The Only Guide to Alternative Investments You’ll Ever Need in 2008 with financial author Larry Swedroe. To learn more about the BAM Alliance or to find an independent member firm, please visit www.TheBAMAlliance.com.

AdviceIQ delivers quality personal finance articles by both financial advisors and AdviceIQ editors. It ranks advisors in your area by specialty, including small businesses, doctors and clients of modest means, for example. Those with the biggest number of clients in a given specialty rank the highest. AdviceIQ also vets ranked advisors so only those with pristine regulatory histories can participate. AdviceIQ was launched Jan. 9, 2012, by veteran Wall Street executives, editors and technologists. Right now, investors may see many advisor rankings, although in some areas only a few are ranked. Check back often as thousands of advisors are undergoing AdviceIQ screening. New advisors appear in rankings daily.

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Teams sought for Lodermeier memorial softball tourney http://mcrecord.com/2015/06/29/teams-sought-for-lodermeier-memorial-softball-tourney/ http://mcrecord.com/2015/06/29/teams-sought-for-lodermeier-memorial-softball-tourney/#comments Mon, 29 Jun 2015 13:15:18 +0000 http://mcrecord.com/?p=577879 The fourth annual Michael (Lody) Lodermeier Memorial Softball Tournament will be held Saturday, July 18. Games will be played at the Lindbergh Lions Recreational Complex softball fields, Eighth Street and Second Avenue Southwest, Little Falls, beginning at 9 a.m.
Teams are currently being sought to take part in the double-elimination tournament.
There is an entry fee. Prize money will be determined by the number of entrants in the tournament. Concessions will be provided by the Little Falls Flyers Wrestling Booster Club.
For more information, or to register a team, call Lisa Maslowski at (320) 296-0472.
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Highway 10, Highway 15 traffic changes in St. Cloud, Sauk Rapids begin June 29 http://mcrecord.com/2015/06/29/highway-10-highway-15-traffic-changes-in-st-cloud-sauk-rapids-begin-june-29/ http://mcrecord.com/2015/06/29/highway-10-highway-15-traffic-changes-in-st-cloud-sauk-rapids-begin-june-29/#comments Mon, 29 Jun 2015 12:54:50 +0000 http://mcrecord.com/?p=577877  

Motorists on Highway 10 in St. Cloud and Sauk Rapids will encounter a series of traffic changes beginning Monday, June 29.

Motorists can expect the following:

  • Eastbound Highway 10 will switch to the newly constructed eastbound lanes June 29. Eastbound Highway 10 will remain a single lane.
  • Westbound Highway 10 will remain on the new westbound lanes, and will also remain a single lane.
  • All permanent ramps and loops along Highway 10 in Sauk Rapids and St. Cloud will open June 29.
  • All permanent lanes of Highway 10 and Highway 15 in St. Cloud and Sauk Rapids are scheduled to open by 9 p.m. Thursday, July 2.
  • Intermittent lane closures on both directions of Highway 10 and Highway 15will resume at 9 a.m. Monday, July 6. The lane closures are needed while crews complete the final stage of construction. The project will be complete by late July.

Highway 10 between East St. Germain Street and County Road 33 has been reduced to a single lane most days since April 1 while crews reconstructed the road. The project will result in new pavement, improved drainage and a smoother ride on Highway 10, and ensure the road continues to serve the state for many years.

Highway 10 is an important freight and tourism route, supporting the state’s metro and rural economies. To learn more about how MnDOT and transportation funding, visit Get Connected at www.mndot.gov/getconnected.

To get more project information, visit www.mndot.gov/d3/stc.

For real time travel information anywhere in Minnesota, visit www.511mn.org.

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Bowlus Fun Day: 12 hours people won’t soon forget http://mcrecord.com/2015/06/29/bowlus-fun-day-12-hours-people-wont-soon-forget/ http://mcrecord.com/2015/06/29/bowlus-fun-day-12-hours-people-wont-soon-forget/#comments Mon, 29 Jun 2015 11:05:27 +0000 http://mcrecord.com/?p=577800 Bowlus-Fun-Day-clownsOn Sunday, July 5, folks will flock to Bowlus for Bowlus Fun Day. The all-day event, sponsored by both the Bowlus Fire and Rescue and the Bowlus First Response teams, will have something for everyone.

Bowlus is located on Highway 26, five miles west of Royalton.

A 5K walk/run, hosted by the Guardian Angel Youth Group, kicks off the celebration with registration for the run from 7:30 a.m. – 8:15 a.m., with the 5K beginning at 8:30 a.m. The walk/run starts at the gravel parking lot at the Bowlus Feed and Grain. A free 1K run for children under 12, will begin immediately following the completion of the 5K.

An outdoor Mass at 10 a.m. on the grounds of St. Stanislaus Kostka Church, will feature music by “Kid Polka.”

The parade down Main Street, that some say is the best in Central Minnesota, begins at 11:15 a.m.

A full 12 hours of fun follows, from noon – midnight, when visitors can enjoy continuous music, activities, rides and games for all ages in the Bowlus City Park.

The traditional water fights involving area fire departments begin at 2:30 p.m.

Refreshments, food, games, music and activities for the entire family are offered all day, including horse rides and Bowlus Fun line rides, pull tabs and more.

Music through the day will be provided by “Kid Polka” from noon – 4 p.m. and then “Loss 4 Words” takes over from 7 p.m. – 11 p.m., located in the covered band shell in the city park.

The grand raffle drawing is held promptly at 9 p.m., with fireworks beginning at dusk.

For more information, call Arnie “Punky” Benusa at (320) 584-5405.

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