The Wealth Builder Carnival #5

Welcome to fifth edition of The Wealth Builder Carnival. The purpose of this carnival is to collect articles from the blogosphere on building, preserving and keeping enough wealth for a comfortable retirement. For reference, I have tried to keep the carnival content tightly focused on wealth building. As a result, this carnival did not include submissions that were off topic, e.g. those about debt, debt management, debt reduction, credit scores, credit monitoring, credit card evaluations, or account opening bonuses.

For this carnival, I have organized the posts into seven categories: Earning, Investing, Insuring and Protecting, Living Frugally, Retiring, Saving and Taxes. I have acknowledged bloggers who are in Technorati's Top 100 Finance blogs by showing their 9/7/2010 rank in parentheses. Finally, for some submissions, I have added my perspective and comments relative to the post topic.

And now onto the Carnival:

Earning

Kai S. presents Make Residual Income, posted at Internet Business Tactics, saying, "Earning residual income should be one of your main focuses if you ever wish to retire any time soon." However, this approach also has disadvantages which the author points out in the article.

Super Saver (#13) presents Our Journey to Financial Freedom #3 -Making The Most Of My Job, posted at My Wealth Builder, saying, "Exceptional work was needed to be compensated above average." For us, my job was our main source of income. Focusing on significantly increasing my salary turned out to be a good wealth building strategy for us.

Investing

Mike Piper (#5) presents Hedge Fund Expenses: They’re Not Cheap, posted at The Oblivious Investor, saying, "Even relatively low-cost hedge funds have expenses several times those of a good index fund." High fees are a good reason to avoid using hedge funds. The poor returns in 2010 are another reason.

FMF (#17) presents Understanding Investment Risks, posted at Free Money Finance, saying, "One key to successful investing is understanding the various risks you take when you make a particular investment." A great summary on the risks involved with investing.

Dividends4Life presents 9 Stocks Raising The Dividend Growth Bar posted at Dividends Value, saying, "Have you ever noticed those that most vehemently attack a buy-and-hold strategy really don’t understand how the strategy works? They confuse a buy-and-hold strategy with day-trading with a longer duration. A true implementation of buy-and-hold includes a focus on blue-chip stocks with a sustainable advantage, along with a reasonable asset allocation framework."

Frank Knight presents Asset Allocation Strategy posted at Best Personal Financial Planning Software, saying, "When you are already there and invested in an asset class, you are following a passive asset allocation strategy. Tactical asset allocation strategy advocates suggest that you can anticipate the crowd, but flow-of-funds studies show that almost all tactical asset allocation fund flows are late money flows that chase performance after valuations have already moved."

Arjun Rudra presents Investing In The Markets With The Threat Of A Double Dip Recession posted at Investing Thesis, saying, "Is the economy going to fall back into a recession or not? Not, at least not in the near term says Lee W. Appleton, portfolio manager at Matco Financial. Lee points to the steepness of the U.S. yield curve as having been a historically accurate precursor of recessions, with nine yield curve inversions followed by nine recessions. With the current yield curve being as steep as it’s been in 45 years, if one were to make an inference it would be that a recession is not on the horizon." This argument was made at different financial presentation I attended. To me, the data was very compelling that the economy will continue to recover.

freefrombroke (#1) presents Why Invest In Mutual Funds, posted at Free From Broke, saying, "Mutual funds are a great way to invest in a great number of stocks at once and can be an integral piece of a portfolio." Mutual funds are a great way to broad exposure to the stock market. No fee ETFs are another option I like. The main drawback for no-fee ETFs is there are fewer choices and having an account at a particular brokerage is usually required.

Ken presents How Money Works: The Magic of Compound Interest, posted at Spruce Up Your Finances, saying, "Understand how your money can grow faster because of the magic of compound interest." To me, compound interest is one good reason to save early and often.

MoneyNing presents Second Recession: Don’t Let Fear Take Over, posted at Money Ning, saying, "Whatever the circumstances, allowing fear to creep in will only make the situation worst." In my opinion, fear is causing many investors to buy treasuries, meaning this may be a good time to invest in stocks.

Insuring and Protecting

Miranda Marquit presents 5 insurance policies you shouldn't be caught without at Insure.com saying, "Insurance is a necessary expense if you want to protect your assets in the event of an unexpected catastrophe. "

Living Frugally

Silicon Valley Blogger (#11) presents No Fee Money Market Funds, Savings and Cash Accounts, posted at The Digerati Life, saying "Here is a list of no fee cash accounts and best high yield savings accounts."

PT presents Free Online Checking Accounts, posted at Prime Time Money, saying, "Don't pay for fees that aren't necessary. Find a free checking account!"

Free is good:-) Many of the banks in my area also offer no fee accounts which is the option I like to use. I still prefer a local bricks and mortar bank over an online one.

Taxes

David de Souza presents Landlords: 3 Ways To Reduce Your Tax Bill posted at UK Tax Blog, saying, "If you are a landlord, you may be paying too much tax on your rental income. Our guide explains how to pay less property tax." For us, reducing taxes and keeping more of our money is always a good strategy.

That concludes this edition. Submit your blog article to the next edition of The Wealth Builder Carnival using our carnival submission form. Past posts and future hosts can be found on our blog carnival index page.

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