If you invest $1.00 at 5% and let it run for 50 years, it would have grown to $11.00+, without allowing for the erosion of your income, whether annually or after a period of years, several times, by income tax, or the ongoing erosion in value of your asset by inflation. If, however, you could invest it at 10%, after that same 50 year period it would have grown to $117.00+. Your investment could lose 3/4 of its value and still come out ahead of having invested it at 5%. Actually, more than that - for it's the value after taxes and inflation that really counts. Do you expect that companies like Exxon, Gillette, Coca Cola, and such, or other major petroleum, pipeline companies, etc. may go out of business? Or even suffer serious losses. A person who invests a major portion of his (probably less likely "her", cause women generally are more risk-averse and less likely to plunge; [some would say, "smarter"]) total invested asset into highly speculative issues seems to me to have cheese for brains. The stock markets as a whole have average growth of 7 - 8% or so, over the long term. Few mutual fund managers' holdings have grown faster. And they charge fees for their expertise - somewhere between 1 - 2% in the U.S. for equity (i.e. stock market based) funds, most of them over 2% annually in Canada. If they match the long-term average growth of the market ... they're reaping about a fifth to a quarter of the growth, a larger proportion in Canada. Unfortunately, if there is no growth - they still get their percentage. Many persons calling themselves financial planners/advisors are actually mutual fund sales people: that's all the equity-related financial issues that they're licensed to sell. They don't want to talk to you about individual stocks, for they can't sell them and it's illegal for them to recommend them unless they've taken the courses that stockbrokers take (which few have - their courses are much less complex). There are a few who sell no financial products, but many of them stop doing that because often their income levels are much lower, despite many people who want to invest saying that they'd really love independent advice. One should investigate what kind of training a prospective personal financial advisor has taken and whether s/he has advanced courses above the minimum requirements. Also what kind and length of experience the prospective advisor has. Also what lifestle experience the prospect has: some have seen a great deal more of life than others - and have learned much more per year than many who have lived as many years. Finally - you need a person whose personality and ideas are compatible with yours. You will trust that person with a very important part of your life. Some years ago, when I had a display at a county fall fair, someone asked me what right I had to call myself a financial planner. I said that we could get rid of unemployment tomorrow - we need only have every unemployed person put out a shingle on his front lawn calling himself a financial planner, as it was unregulated - any darn fool could do it. Stock brokers were regulated, as were mutual fund salespeople, but in our area at that time financial planners were not, as there were few of them operating outside of stockbrokerage and mutual fund sales agencies. That's not the case now - but it would be a good idea to ask several of them what kind of regulations there are governing them. I took the course that stockbrokers take, over 20 years ago and worked for a mutual fund sales brokerage (i.e. they could offer mutual funds managed by a large number of managers, rather than only funds managed by their own company). I didn't produce enough sales to suit them, so was there for only one year. I'm more tuned into the idea of helping people set their financial goals, look at some concepts that they might not have thought of, and work toward achieving them. I am totally devoted to helping my clients decide what they want to achieve and start out on a plan of how to achieve that/those goals. They don't have to be concerned that my advice or recommendations may be slanted toward various financial products that I just happen to sell, for I don't sell any. One local person that I met a few years ago said that he'd done well in business and managing his investments, so some friends asked him to manage some money for them. He asked for a minimum investment of $10,000., asked the client to sign a power of attorney for that account only, and when he made decisions about investments, a copy of the confirmation went to the client and one to him. He charged 10% of the growth (exclusive of dividends, if I remember correctly). Rather a good idea, for if he doesn't produce, he doesn't get paid. There is a fairly major proviso, though - that he might choose some fairly risky investments where there could well be a possibility of major gain. He being a person of integrity, I think that he was quite strongly guided by the level of risk that his clients were willing to tolerate. When I asked what happened if there were no gain - he said that there hadn't been a year yet that he hadn't been able to send a request for payment to every client. I'm not sure how many years the concept had been in operation. This has been rather off topic - sorry about that. As for many people lacking time to manage their investments ... ... many people spend more time on consideration of where they'll go for a two week vacation than they do on an investment system that may well be in place for forty years (or more). Good wishes for making your money work well for you - rather than better for someone else. joyful guy

I also rec'd an offer like this quite some time ago. Looked really "good"! ZERO % FOR LIFE!!!??? I continued to receive those offers at least once a month for many months. But, I'm always leary of the "too good to be true". I finally sat down and picked it apart (reading ALL the fine print), and decided it WAS too good! The "catch" was - you MUST make at least 2 purchases per month -(and I think at one time they even had a minimum of $15.00 or something per purchase) - and if you did NOT make thoses "charges" twice a month, the whole deal goes to heck! (I think there was some other "catch" also - I don't remember) PLUS - like someone else said...be careful. If you default on ANYTHING (a different c.c. - or even late on a utility bill, etc., COULD hurt you really bad.) In "my" case, I KNEW I would get into trouble with this offer. I knew it would be hard to remember to charge something twice a month ("their" billing cycle month) - as I just don't go out and charge stuff daily! Plus - I don't need another pain in the buttocks...I don't need a card who in recent past has caused so many headaches for so many people - (Yup! Big deal about a "discovery" type card a few years back!)- and I certainly don't need my credit score to take a dump for applying for this card which I would have to mark calendar to be SURE I make purchases every month! (Not to mention the additional "junk mail" I would have to deal with!) The offer looked SO GOOD...on the outside. Like a wolf in lamb's clothing. WHO?!!! would offer to LOAN $$$ for nothing - forever??? There HAD to be a catch! I'm sure someone could maybe benefit from something like this...but not for me.

Hi Surfergal, (Man... with that moniker I wann know where you live, where you surf, I wanna see pics & stories of the last road trip!) Where can I find information on alternatives? What you are specifically asking about falls in the realm of conservative, tax-avoiding and tax-free savings/investment accounts. BEFORE I PROCEED... it is important to state that your overall (personal? family?) portfolio and balance sheet needs to be structured to fit your stage in career earnings (on the rise? On the wane?) your time-to-target ("target" being financial freedom from safe passive income streams,) your risk exposures (health costs, employability, long-term care, asset protection, liability protection, etc.) and your "inflation defensive" investments (almost by definition, managed equities investment accounts.) NOW.... HAVING SAID THAT.... You can get tax-deferred market-like upside, and zero-loss-of-principal guarantees on the downside, with Indexed Annuities. They grow without any "tax bite" on your interest credits, and you finally only pay taxes on the interest (not principal) when you actually withdraw funds. There are a growing assortment of indexed annuities coming on the market specifically designed for the Boomer personality, who has no interest in annuitizing (which gives away control of the principal in return for steady income for the rest of your life,) but still wants guarantes of spendable income. ALTERNATIVELY, you can integrate your insurance coverage with the protective upside benefits of indexed annuities, and GAIN COMPLETE TAX FREE ACCESS to your interest income by using Equity Indexed Universal Life policies. While the two vehicle categories above are "indexed" to the broad stock markets (which means they have interest payments calculated to rise when the markets rise, but never lose principal when the stock markets fall,) they also somewhat lag the stock markets a bit, because the guarantees against downside losses cost the offering companies an insurance cost to protect your money. and how accessable would my funds be? All "safe" vehicles usually have a lock-in period. CDs are generally 100% locked-in, with penalties for early withdrawel. Indexed Annuities and Indexed Universal Life usually have a 'no penalty withdrawal allowance' of a percentage of your total account during their lockin period. and the tax implications on withdrawal? Annuities' interest credits are taxed on withdrawal. Cash-value Insurance interest is taxed IF withdrawn... NOT taxed if you take it as a loan to yourself, from your own account. These tools are not a silver bullet one-size-fits-all solution... but ought to be considered in the overall balancing of your total family portfolio. Cheers, Dave Donhoff Strategic Equity & Mortgage Planner

My suggestion to clients (and others - like, for example, here) was that I don't like getting tax refunds - which means that I paid too much from every payment, last year. If a person gets $1,200.00 back, it means that $100.00/mo. too much was deducted and sent to the income tax people every month last year, on which they paid no interest. Then your loan to them stayed at $1,200. from Jan. 1 till (Canada) the end of April, on which they paid no interest. It used to be that they'd start paying interest on overpaid money beginning May 1 ... but a few years ago they dropped that date back to June 15 (by which time a major part of the refunds had been sent out). If you'd like to make interest-free loans for even a short period, I'd like to stand in line to get some - where should I stand? And how soon do you want it paid back? Heck - I have to pay the bank 5.0% (or, did, until the Bank of Canada cut the Prime Rate this morning ... and most of the banks immediately followed suit - maybe it'll be 4.5% now). I like 0% better than that. When I put my money into the bank, they give me a bit over 0% ... but not much. Have a lovely week, everyone. ole joyful ... who doesn't like to either earn - or pay - interest Why not earn? Taxed too high! (Canadian dividends much lower). o j