Chickens, Pigs, Bulls and Bears: The Stock Market is a Barnyard

The great novel Animal Farm, written by the legendary author George Orwell, is about animals and how they live together in a hierarchical society. As it turns out, he may have been talking about the stock market.  The market is full of these named animals and each has a different place on the investment pole.

Pigs are greedy, chickens fearful, bears hide and sleep, bulls charge ahead. Over the years, these names have become synonymous with a person’s investment interest or view of how the market is going to move. Really, the names of the animals signify an individual’s approach or philosophical investment strategy.

Here are the animal definitions converted to investment philosophies:

Bull: A Bull Market means the economy is growing and means investor confidence and anticipation of market growth.

Bear: A Bear Market is the opposite, the economy is weakened or expected to weaken.  The stock market is expected to be lower in the future.

Pig: A Pig Market is a high risk big score (or big loss) position. Pigs are impatient, greedy and emotional towards their investments and only think of themselves.  Pigs normally get slaughtered.

Chicken: A Chicken Market is fear.  Chickens have no specific plan and are driven by fear of losing their money. Fear overrides common sense and any plan is quickly changed if a loss occurs.
If you have a plan based on reality you are probably not a pig or a chicken.  It means you have used good, available information and are heading towards your goal.  As we age, the goal can also change, from accumulation to income.

But what about this….what if you can’t afford to lose any of your important money!  How do you evolve from the barnyard descriptions with a philosophy that makes sense to you?  In other words, how does your retirement plans relate to safety, security and stability?

While no one approach makes sense for everyone, using a new financial vehicle called a Fixed Indexed Annuity with an income rider attached really works for many people.  The annuity provides total protection from any downside movement in the stock market while providing a guaranteed yield in the range of 4% to8% when used as income. (income rider)

If it is time to take a new approach to some of your important retirement funds, consider this powerful option, then maybe you will no longer be a barnyard animal, you could be soaring like an eagle.

You can request more information and a free annuity quote by filling out the form on our website.

Or you can research annuities further in our Annuities 101 section.$

www.RayBuckner.retirevillage.com

Your Guide To Choosing A Tax Professional

Choosing a tax professional is vital to proper financial management, and most advice-oriented articles will tell you that your tax professional is the person you should consult for any and all tax-related matters. If you don’t have a tax professional, now is the time to find one, and this guide can help you.

Why Do I Need A Tax Professional?

Taxes are complicated, and full of regulations and ever changing laws. Depending on your situation, your tax return may be simple, or involve a series of very detailed steps. If you don’t know what you’re doing, tackling a complicated tax return by yourself can potentially create problems, i.e. audits. Trusting a local tax preparation service isn’t always a foolproof option either. A trusted tax professional, someone whom you’ve selected and whom you feel comfortable working with, is a valuable asset, and depending on their expertise, the tax professional you choose may be able to save you more money on your returns.

Are There Different Types of Tax Professionals?

Tax professionals can be either Certified Public Accountants (CPA) Enrolled Attorneys (EA) or certified and non-certified tax preparers. The obvious caveat in choosing a licensed or non-licensed tax preparer is that only a CPA or an EA can represent in you in court, should the need arise, and the local tax preparer many not be as knowledgeable as a CPA or EA.

CPA:

When most people say that they are looking for a personal accountant, they are really looking for a CPA. CPA’s are best for those with more complex taxes, like small business owners, and for those who are looking for a long term relationship with a tax professional who can help them discover tax saving strategies. It is important to do careful research in order to find a CPA who is properly qualified to meet your more complicated tax needs. The first step in finding a good CPA is to check with the State Boards of Accountancy to make sure that a potential CPA has been licensed and has not been subjected to any disciplinary actions. All CPA’s are licensed at the state level, but it is important to know that licensing requirements can vary from state to state. CPA’s in the Virgin Islands, for example, are only required to have a high school diploma, while CPA’s in Ohio are required to have completed 150 hours of college course work, and have a concentration in accounting. You should also inquire as to whether a CPA is a member of the American Institute of Certified Public Accountants, a professional organization that offers some disciplinary oversight.

Enrolled Agents:

Enrolled agents are a better choice for many tax filers, since they are less expensive and more dedicated to preparing individual returns. Enrolled agents are also licensed by the IRS, and like Tax Attorneys and CPA’s, are required to meet certain criteria in order to practice. This group is not regulated at the state level, however, so the IRS will not be able to inform you about any ongoing complaints. You can call to see if an ERA has been suspended or disbarred.

Tax Attorney:

If you anticipate problems with the IRS, it makes sense to have a Tax Attorney in your corner. This could happen if you’ve had a complicated sale of a small business over the past year, or if you’ve neglected to file your taxes for a period of several years. Tax attorneys are also occasionally used to file returns that deal with complicated estate and trust issues. If none of these scenarios apply to you, however, you most likely don’t need a tax attorney.

Choosing A Tax Professional: Ask The Right Questions

You may get a good referral from a friend, co worker, or even your personal financial planner, but you should always check the background and qualifications of the person in question, before you meet them face to face. Once you do sit down for that first meeting, the following is a list of questions that you should ask:

• What types of tax services do you offer?
• Are there any areas that you focus on?
• What other services do you offer?
• Who will prepare my return?
• How aggressive or conservative are you regarding the tax law?
• What is your experience with audits?
• How does your fee structure work?
• What qualifies you to be a tax advisor?
• Do you carry liability insurance?
• Can you provide references of clients who have financial situations similar to mine?

 Regardless of the type of tax return that you use, make sure that you read all documents carefully, before you sign on the dotted line. Tax time doesn’t have to be stressful, and it shouldn’t be, as long as you take the time to research your next tax preparer thoroughly.$
www.RayBuckner.RetireVillage.com