How to beat the mutual fund companies at their own game

Written by Ulli G. Niemann


Continued from page 1

So, what can you do to prevent being taken advantage of? For one thing, do what your mutual fund company does — not what they tell you to do. Adopt a strategy for following trends, such as I do, and userepparttar mutual fund manger’s superior stock picking ability to your advantage by buying and holding only as long asrepparttar 112548 fund is performing well.

Remember,repparttar 112549 fund manager has one big disadvantage over you: He always “has to” be invested so thatrepparttar 112550 public can purchase shares in his fund. You don’t!

If market conditions dictate that you are better off inrepparttar 112551 safety of a money market account because we are in a severe downtrend, then you can take your money and run for cover. He can’t. He is constantly trying to adjust his portfolio to ever-changing economic conditions so that his potential losses are minimized. Atrepparttar 112552 same time you are being told that his fund isrepparttar 112553 investment for all seasons. Don’t fall for it!

You as an individual investor are really inrepparttar 112554 driver’s seat. Unfortunately, you have probably been conditioned to think that Buy & Hope is a good investment strategy, when in fact it is a losing proposition.

Bottom line is, use a well performing mutual fund during strong up trends and get over torepparttar 112555 sidelines during trend reversals. (That's exactly what I did for my clients in October, 2001, and we retainedrepparttar 112556 lion's share of their profits while Buy & Holders kept insistingrepparttar 112557 emperor was wearing new clothes.) Pretty soon you will feel that you are in charge of your financial destiny and any chosen mutual fund is merely a tool to bring you closer to your goals of maximizing your gain and minimizing your losses.



Ulli Niemann is an investment advisor and has been writing about objective, methodical approaches to investing for over 10 years. He eluded the bear market of 2000 and has helped countless people make better investment decisions. To find out more about his approach and his FREE Newsletter, please visit: www.successful-investment.com.


Using an LLC to Protect Your Wealth

Written by James O'Keefe


Continued from page 1

The partnership agreement could further state thatrepparttar limited partnership shall haverepparttar 112547 right to buy outrepparttar 112548 general partner for his share ofrepparttar 112549 partnership and appoint a new general partner to replace her (the "you" in this example isrepparttar 112550 husband; we are makingrepparttar 112551 wife general partner because we assume that husband's risk of getting sued is higher; ifrepparttar 112552 opposite were true, then we would arrangerepparttar 112553 partnership accordingly).

Let's say that you are sued and a creditor obtains a $50,000 judgment against your name. The creditor can attach your limited partnership interest but only torepparttar 112554 extent of your income as a limited partner (called a "charging order"). The creditor who attaches a limited partnership interest cannot participate inrepparttar 112555 management ofrepparttar 112556 partnership, and thus cannot forcerepparttar 112557 general partner, your spouse, to distribute income. As general partner, your spouse stops payingrepparttar 112558 limited partners' distributions, because in her discretionrepparttar 112559 limited partnership would be better served to reinvestrepparttar 112560 capital.

One year later,repparttar 112561 creditor still has a $50,000 unsatisfied judgment. Just to top it off,repparttar 112562 partnership sendsrepparttar 112563 creditor a form "K-1" forrepparttar 112564 creditor's share of your "phantom" income (In our example,repparttar 112565 partnership assets are worth $300,000. At a 10% annual return, your share of income would be approximately $30,000 -repparttar 112566 creditor would have to pay income taxes inrepparttar 112567 ballpark of $10,000! Ifrepparttar 112568 creditor does not payrepparttar 112569 tax due on your undistributed share of income,repparttar 112570 IRS may come afterrepparttar 112571 creditor!). You will be in a strong position to force your creditor to settle his claim for a fraction of its value.

Let's say a creditor sues your spouse and tries to attack your spouse's general partnership interest. At that point,repparttar 112572 partnership exercises its power underrepparttar 112573 partnership agreement to buy out her general partnership interest inrepparttar 112574 amount of $2,000 or 2%. The partnership then finds a new general partner. With proper planning, this may not be considered a "fraudulent" conveyance becauserepparttar 112575 general partner received full compensation for her partnership share.

"Family" LLC's - To Good to be True?

Another similar tool for protecting your wealth isrepparttar 112576 LLC or "Limited Liability Company." An LLC is like a cross between a corporation and a limited partnership. All of its partners (called "members") have limited liability and all of its members can participate inrepparttar 112577 management ofrepparttar 112578 LLC without suffering any liability.

Any assets you hold in an LLC are protected from creditors inrepparttar 112579 same way your assets are protecting in a limited partnership (i.e.,repparttar 112580 creditor's remedy is limited to a "charging order"). In addition, since all members are shielded from liability, an LLC may be an excellent device for holding investment real estate -repparttar 112581 members are protected from tenant lawsuits andrepparttar 112582 equity ofrepparttar 112583 members is protected from other creditors.

James O’Keefe is the owner of My Millionaire Friend offering FREE articles, tips, hints, and real-world advice on how to make money with your website. Visit his site or join his FREE newsletter, by sending a blank email to mailto:newsletter@mymillionairefriend.com.




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