Update: The free Open Social Security tool has been updated to include a new “heat map” visualization that illustrates the relative values of claiming Social Security at different ages. Details here. Here is a sample graph for a couple with similar income histories and the same age:
For this situation, we see that the worst expected outcomes would occur if both individuals claimed really early. The best expected outcomes occur when one claims relatively early and the other claims relatively late.
When to start claiming Social Security to maximize your potential benefit can be a complicated question, especially for couples. There are multiple paid services that will run the numbers for you, including Social Security Solutions (aka SS Analyzer) and Maximize My Social Security, which cost between $20 and $250 depending on included features.
Mike Piper of Oblivious Investor has created a free, open-source calculator called Open Social Security. To use the calculator, you will need to your Primary Insurance Amount (PIA). This amount depends on your future income, so I would first consult this other free Social Security benefit estimator tool to more easily estimate your PIA. I believe the value you see at SSA.gov assumes that you will keep working at your historical average income until your claiming age (which won’t be the case for us).
Here are our results as a couple, assuming we were the same age (we are close) and with my expected benefit being slightly higher than hers:
The strategy that maximizes the total dollars you can be expected to spend over your lifetimes is as follows:
You file for your retirement benefit to begin 12/2047, at age 70 and 0 months.
Your spouse files for his/her retirement benefit to begin 4/2040, at age 62 and 4 months.
The present value of this proposed solution would be $657,749.
Basically, the tool says that my wife should apply as soon as possible, while I should claim as late as possible. I believe this is because this scenario allows us claim at least some income starting from 62, and if I die first after that, my wife would still be able to “upgrade” to my higher benefit.
I am not a Social Security expert, and am not qualified to speak to the accuracy of the results. However, Mr. Piper is the author of the highly-rated book Social Security Made Simple, has a history of doing thorough work, and the tool has been around a while now. If I were close to 62, I would probably also use the paid services for a second and third opinion. Why? Spending $100 now could save you many thousands in the future.
The best thing about this free tool is that it can introduce a lot of people to ideas that they would have not otherwise considered. Even if it lacks every bell or whistle, being free means it can help more people. Many spouses wouldn’t think of having one claim as early as possible (age 62), and then have the other claim as late as possible (age 70). It’s not common sense unless you understand the inner workings of Social Security.
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YOUR GUIDE FOR SAVING MONEY ON PET FOOD
If you are like most people, your dog is not simply a pet. He or she is a member of your family.
You want to provide them the best of everything. From toys to treats, you love to spoil them rotten
But the costs. Oh, how they can quickly get out of control!
WHY CHEAP IS NOT BETTER
Your first thought may be to buy the cheap dog food.
The problem is that the lower quality food can lead to health problems for your pet, which could end up costing you more. It is not the answer.
Instead, focus on ways you can save while still getting your favorite canine the food and treats that are best for them.
STOCK UP WHEN ON SALE
When you find a great deal on the dog food you need, buy extra! There is no reason to pick up one bag when you can get a couple and save.
BUY IN BULK
Oftentimes, the larger bags result in greater savings. Compare the price per ounce of the smaller items to the bigger bags to find the lowest cost.
TRY THE STORE BRAND
Just as with the store brands you buy, sometimes the store brand of pet foods is the same – simply in different packaging.
Carefully review the ingredients before making the switch. After all, if they are the same, why are you paying for the label?
SIGN UP FOR THE STORE REWARDS PROGRAM
Loyalty has its perks. Many stores offer loyalty programs to members. You can get exclusive offers, discounts and coupons that are only offered to those who have signed up.
Some programs also reward for your purchase in the form of points. Once you accumulate the points you can cash them in towards savings or freebies.
GET ON THE LIST
Even if you are a member of their program, make sure you are also on the list! You will get alerts for sales and may even find some awesome coupons to make their way into your inbox as well.
Tip: Make a secondary email address to use so your inbox is not cluttered with these types of emails.
USE ONLINE SERVICES
There are online pet product providers, such as Chewy, who sell pet food and other items, often at a discount. The added perk here is that they deliver it directly to you – so no lugging home huge bags of dog food from the store.
You can use apps such as Honey or Wikibuy to compare online prices to ensure you also find the lowest possible price for the items you need.
SET UP AUTOMATED DELIVERIES
Some sites, such as Amazon, offer discounts if you sign up for automated delivery of select products. Not only will it be delivered, but you also won’t have to worry about running out.
CHECK FOR REBATE OFFERS
Sometimes, manufacturers offer product rebates. If you can find these, you’ll get money back on your purchase.
PRAISE (OR COMPLAIN)
If you have a food your pet loves, send an email letting them know. They may send you coupons or vouchers for products as a thank you.
Alternatively, if you have a problem with a product, make sure to reach out. The company may offer a refund or alternative product for your trouble.
SHOP THE WAREHOUSE
Skip the big box stores and head to your local warehouse. You may find larger bags at a lower cost sold there – saving you time and money.
BECOME A TRACKER
All stores run sales in cycles. They do this on food, clothes, and more – including pet food! Keep track of the offers at your favorite stores.
You will start to learn their cycle and can then stock up when items are on sale.
SKIP THE STORE AND MAKE HOMEMADE DOG FOOD
You can even bypass the store and make your own dog food right at home. There are countless recipes on Pinterest that you can try.
But, before you rush to start a cooking frenzy, make sure to carefully research each ingredient to make sure it is safe for your pet to consume.
PUT COUPONS TO WORK
Before you head to the store, head online, and search for coupons for your pet’s food. You may find them on the manufacturer’s website or on coupon printing sites.
Make sure to also check the product packaging as you may find them stuck to the front of that big bag of dog food.
GET FREE SAMPLES FROM YOUR VET
Vets get free samples of the products they sell – so ask for one! The freebies do not cost them anything, so they should be more than happy to give you one if you inquire.
A Peek Into the Last Few Weeks (and our family vacation!)
How to get a shower and get ready for the day when you’re taking care of two babies! 🙂
People ask me all the time how I’m doing with having two babies and I think this early morning picture says it all. Life is full, my hands are full, and my heart is so full! (By the way, I’m actually putting this post together while trying to bounce Kierstyn to sleep in the Baby K’tan… it’s rare that I don’t have at least one baby in my arms these days!)
How could my heart not be full when this is an almost daily site at our house!
Silas had another weekend baseball tournament at a town about an hour away (Murfreesboro). We had fans set up with a generator, tents, lots of cold drinks in coolers, and these cold wraps to keep everyone cooled down
Champ has been learning how to hold his head up and roll over!
The babies have started to love having books read to them. Goodnight Moon was Silas’ favorite book when he was little, so it’s been so fun to introduce the babies to this book!
We packed for our family trip in tubs — each person got a tub for the week. This saved so much space in our vehicle and made things much more organized!
Our one out of state trip this summer was to go meet up with my family at Bull Shoals Lake in Arkansas. We weren’t sure if the trip was going to happen due to COVID-19, but because of a number of safety measures we put into place, DCS gave us special permission to be able to go and take Champ with us.
Every afternoon during our annual extended family lake vacation, my mom has “Grandma Time” with her grandkids. She teaches them a Bible lesson, they do a craft, have a snack, and do a game together.
Over the past two years, the older grand kids have started helping out. This year, each of the older ones signed up to help out with a craft and/or a snack and then Kathrynne is in charge of games (complete with an elaborate ticketing system and prizes they can turn their tickets in for at the end of the week ala Chuckie Cheese style!)
As many of you know, my mom had some serious health issues last year, including multiple extensive surgeries and skin grafts for skin cancer. She also got really sick with pneumonia in the middle of all that.
She almost didn’t get to come on the annual lake vacation last year. She did come, but she was so weak and sickly that I wondered if she’d make it another year.
This year, at 66 years old, she’s stronger than ever — not only leading Grandma Time, but also skiing and helping with the babies and cooking and looking for ways to reach out and serve all day long.
I know many of you prayed for her last year and I just wanted to tell you thank you, again! I look at this photo I snapped earlier this week and it just reminds me to be grateful for the many gifts it represents.
Her first time in a pool!
They had this sign at the pool! 😉
For details on how we all pitch in on meals and clean up, check out this post.
One of my favorite parts of our extended family vacations: the daily salad bars we have.
On our way home, we stopped by Ozark, MO so the girls and I could go in to the discount store there. (More details on what we bought coming this weekend!)
Jesse’s parents and his sister, Lisa, drove from Kansas to meet up with us so they could meet the babies, too.
I’m so grateful we got to spend time with extended family. This year certainly has made us so much more grateful for this!
A year ago, we were in the middle of our foster care home study and praying for who God would bring into our home for us to love on.
We were at peace about pursuing this path, but we were still apprehensive and wondering what it might mean for our future. There were so many unknowns, so many what if’s, and so many things outside our control.
I look back on this last year and the 5 children we’ve had the privilege to have in our home — 4 for just a very short-term stint and sweet little Champ who has been with us for almost 4 months.
There are still just as many unknowns, what if’s, and things outside our comfort zone. My heart has been broken in a hundred little pieces over the things we’ve seen and witnessed firsthand and the many kids and their stories whom we weren’t able to say yes to. I’ve cried more tears in the last 10 months than I’ve cried in the last 10 years (okay, pregnancy and postpartum probably played a part in that!).
And yet, my heart is fuller and happier than I can ever remember. The opportunity to love, pour into, and nurture has filled me up in the deepest of places. Seeing my husband and kids sacrifice and serve and love so well has been one of the most amazing experiences.
I don’t know what the future holds. I can imagine it will be full of heartbreak and beauty, tears and love, a roller coaster of emotions, and many things I can’t even imagine.
There are many unknowns, but this one thing I know: I don’t regret for one second saying “yes” to foster care. I look at these pictures and think, “We could have missed this.”
Are Penny Stocks Worth It? 7 Tips to Help You Reduce the Risk
As share prices for giants like Netflix and Amazon surge, it’s easy to feel priced out of the stock market. As of Aug. 3, a single share of Netflix would cost you $502.19; for Amazon, you’d pay $3,134.82 per share.
If you’re a beginning investor, the high prices may tempt you to seek out a bargain. Enter penny stocks.
Penny stocks seem like an opportunity to buy into an up-and-coming company for dirt cheap. You can buy hundreds or even thousands of shares for the price of an S&P 500 company share.
But watch out: Investing in penny stocks could easily leave you broke.
What Is a Penny Stock? Are Penny Stocks Worth It?
The U.S. Securities and Exchange Commission defines a penny stock as one that trades for $5 or less per share. Most investors, though, take a narrower definition. Many define it as one that trades for under $1.
But it isn’t just the low trading prices that define penny stocks.
You can find stocks trading for under $5 a share on major stock exchanges, like the Nasdaq or New York Stock Exchange (NYSE). But most investors don’t consider these to be penny stocks.
Penny stocks generally trade on the over-the-counter (OTC) market. The transaction takes place between the broker-dealers for the buyer and seller. They use the OTC market to name their prices. There’s no central exchange facilitating the trade, which can happen without anyone else knowing the transaction price.
The transaction may feel the same as it does when you invest in stocks listed on a major exchange. You can typically use whatever brokerage account you normally use to trade stocks. You place the order in the same way you would for any other stock.
The only thing that may stand out: Your broker is required by the SEC to obtain your signature on a risk disclosure document before placing your first penny stock order.
Why Are Penny Stocks So Risky?
If you’re wondering, “Are penny stocks worth it?”, the answer is pretty much a resounding, “NO!” Here’s why penny stock is among the riskiest investments you can make.
They Lack Transparency
Big companies that trade on major stock exchanges are required to file lots of information with the SEC. The information is publicly available at SEC.gov.
But a company with less than $10 million in assets or 2,000 individual investors may not have to file with the SEC at all. Plus, investment analysts and news reporters scrutinize bigger publicly traded corporations. A company with under $10 million in assets is unlikely to draw any of this scrutiny.
Companies traded on over-the-counter exchanges are subject to far less oversight than companies on a big stock exchange. Most penny stocks trade on the pink sheets, an electronic stock listing service that gets its name because it used to be published on — you guessed it — pink sheets. Companies listed on the pink sheets aren’t required to disclose any information.
There’s Usually No Minimum Listing Requirements
Any stock that trades on a major exchange is subject to strict requirements.
For example, for a stock to start trading on the NYSE, these are just a few of the requirements:
- At least 400 shareholders who each own at least 100 of the company’s shares.
- A minimum of 1.1 million publicly traded shares with a value of at least $40 million.
- The stock price must be at least $4 per share.
The companies that issue penny stocks usually can’t meet these stringent listing requirements.
Maybe they have no proven track record. Or maybe they do have a track record, but it’s a troubled one. If a stock listed on the NYSE or Nasdaq falls below $1 per share and stays there for an extended period, it will be delisted. Then, you’ll see it on the OTC markets.
“Penny stocks are typically highly speculative investments,” said Matt Frankel, a certified financial planner (CFP) at The Motley Fool’s The Ascent. “Not only are many penny stocks issued by companies that are yet to achieve profitability or even revenue in many cases, but there’s a significant amount of fraud in the penny stock world.”
They’re Highly Volatile
A single piece of good or bad news can make or break your penny stock investment. The companies are so small that their success may be contingent on getting FDA approval for a single drug or obtaining a patent. A relatively small change in demand for the stock can also result in major gains or losses.
“A penny stock that goes from a few cents to a few dollars can represent massive return on
investment, sometimes in the thousands of percents,” said Evan Tarver, senior financial analyst at Fit Small Business. “However, there is a much higher likelihood that a penny stock will drop to nothing, meaning you would lose your entire investment.”
You May Not Be Able to Sell Your Shares
Most penny stocks have a low trading volume. That means they trade infrequently, which is bad news for you when you want to sell.
Let’s say you owned 5,000 shares of a company, but the trading volume is only 1,000 per day. You’d realistically have to wait five days to sell all your shares. Even then, you may have to sell for much lower than your ask price.
In investor speak, this is known as low liquidity: To quickly convert your investment to cash, it’s likely that you’ll have to do so by discounting the price.
Penny Stocks Are Rife With Fraud
The world of penny stocks is filled with fraudsters who prey on inexperienced investors. Two of the most common penny stock scams are the pump and dump and the short and distort.
Pump and dump: Scammers drum up hype about a company to drive up share prices. They may say that a company has found the cure for coronavirus or that it’s found a new gold mine. Then they offload their inflated shares on unsuspecting investors.
“Penny stock scams use email newsletters, message boards, and bogus press releases to try to create interest in the stock,” Frankel said. “Some even pay analysts to write up legitimate looking ‘research’ reports on the company, and many even cold call unsuspecting investors to tell them about the ‘incredible opportunity.’”
Short and distort: Investors use a complicated maneuver called short selling when they’re betting a stock’s value will drop or become worthless. With the short-and-distort scam, fraudsters short the stock, then spread false negative rumors about the company. When share prices plummet, they profit.
But Couldn’t I Pick the Next Facebook?
Theoretically, yes. But that’s highly unlikely.
Most wildly successful companies were never traded as penny stocks, even though early investors who stuck around reaped huge profits.
“Most successful stocks, such as Microsoft (MSFT), Facebook (FB), and Tesla (TSLA), all first listed their shares on the NYSE or Nasdaq with prices above $10,” Investopedia reports.
7 Rules to Follow if You’re Still Determined to Trade Penny Stocks
But what if you’re determined to do it anyway? Follow these rules to mitigate the risks.
1. Only Invest What You Can Afford to Lose
Would you be OK with losing this money at the poker table? Don’t invest it in penny stocks if the answer is “no.”
“Any money that you are prepared to invest, you should be comfortable losing 100% of that investment,” said Lou Haverty, a chartered financial analyst (CFA) with Financial Analyst Insider. “In other words, only invest money that you can afford to speculate with.”
2. Research Before You Buy
If you can’t obtain information about a company from SEC filings, that’s a sign that you should pick a different stock. Also, make sure you understand the basics of the industry and how the company makes money. A little knowledge will help you see through overhyped claims.
3. Look for Stocks With a Decent Market Capitalization
Be wary of stocks with extremely low market caps. That means the overall value of its shares is very low.
Most penny stocks are either nano-cap companies (market capitalization of $50 million or less) or microcap companies (market capitalization of $50 million to $300 million).
“As a general rule of thumb, I won’t even consider investing in stocks with market capitalizations under $200 million, which eliminates most of the penny stock world,” Frankel said.
4. Pay Attention to Trading Volume
A stock’s trading volume shows how many shares are bought or sold on a given day. Look for penny stocks with a minimum trading volume of 100,000 to 200,000 to improve your chances of having a willing buyer should you need to sell.
5. Use Automatic Stop Loss Triggers
Haverty recommends setting up stop loss triggers if you’re determined to buy penny stocks. If your share prices fall by the amount you specify, your brokerage will automatically put them up for sale.
6. Watch Out for the Hype
Look out for outrageous claims about a stock’s potential. They may pop up in investment newsletters, emails, websites and message boards.
“If an investment opportunity sounds too good to be true, it probably is,” Frankel said. “For example, if you see a penny stock discussed in a newsletter or on a message board claiming something to the effect of ‘make 200% in 1 week,’ you can be pretty sure you’re looking at a pump-and-dump scam.”
7. Put No More Than 10% of Your Portfolio in High-Risk Investments
High-risk investments should never take up more than 10% of your portfolio at the absolute max.
That’s 10% for ALL the risky investments. You don’t get 10% for penny stocks, 10% for bitcoin and 10% to invest in gold.
It’s essential to keep the other 90% in a diversified portfolio that’s invested across the stock and bond markets.
But pretty much any experienced investor will tell you that boring is better in the long run.
Robin Hartill is a certified financial planner and a senior editor at The Penny Hoarder. She writes the Dear Penny personal finance advice column. Send your tricky money questions to [email protected]
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
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