031 Caught Doing Good

(Complete Show Notes Below)

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In the 31st episode of the Financial Procast:

Home Equity Loans are Making a Comeback

Minute 2:26

According to recent piece over at MarketWatch it seems some old behavior has come back again. Yep, that's right…people are once again borrowing against the equity in their homes to buy stocks, investment real estate and wait for it…art.

We discuss the ins and outs of taking the equity out of your home to plow into other investments.  It's really more of a mathematical argument than anything else.  We don't think it's always a bad idea…on principle, however, you have to be sure that you understand all of your risks before diving into the debt pool.

LPL gets in a Jam with Big Jelly

Minute 23:30

Well it seems that LPL has themselves in a pickly with Maureen Sloan, an heiress to the Knott's Berry Farm fortune.  It seems that a broker from LPL has gotten the firm into a bit of trouble by convincing Ms. Sloan to withdraw $4 million on margin to invest into auto leasing company that the broker owned.

What's the big deal?  Investments go bad, that's the nature of the beast…right?

Well, it appears the broker, Alberto Neira, hadn't informed LPL about his side business and LPL never bothered to question why Ms. Sloan was cashing out the $4 million on margin.

Retirement Savings Anxiety

Minute 39:21

According to a recent Franklin Templeton commissioned survey, about 75% of the respondents are a little stressed when thinking about retirement and their retirement investments.

Our concern is that there seems to be a bigger problem in that over half the people aged 45-64 have $100,000 or less set aside for retirement.

Questions from Listeners

Minute 49:21

1.   James asks us about fees on paid-up additions and how higher loads can potentially help dividend payments on participating whole life policies?

Minute 53:39

2.  Brian asks us about the logic of paying more for term insurance from Northwestern Mutual.  You definitely don't want to miss this discussion, if nothing else for its comedic value and the creativity of his NML agent in explaining their over-priced term rates.


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