By Amanda Morrall
1) Don't sell the kids
Unless you've been living in a cave, most of you will know this week marked the official launch of the much touted Mighty River Power initial public offering. Wouldn't you love to know how many of the 444,000 plus pre-registrants actually put their money on the table. Top secret, says John Key. When push comes to shove, most people are reluctant to open their wallets. That's particularly the case when it comes to investing in the stock market. It's not for me to say whether this is a good or bad deal. I'm not an authorised financial advisor (AFA). I would however agree with AFA and best selling investment writer Martin Hawes that if you are carrying debt you might want to hit the pause button and think this one through very carefully.
I'm always interested to hear Martin's views and invite you to do so as well here by checking out his latest newsletter.
2) Flip a coin
Because most of us do something other than scrutinising stocks for a living, we rely on expert opinions as to whether a particular company is a good one to invest in or not. The trouble is knowing who to believe. Should you believe your broker, your outwardly looking rich neighbour who professes to know a thing or two about the markets, or your financial advisor.
Number crunchers at Nerdwallet in the US decided to measure the performance of certain stocks recommended by experts in the US to see how they measured up against their hardy endorsements. It's not exactly a ringing endorsements for the experts and thus Josh Brown's (aka. The Reform Broker) 'Flip a Coin' headline on his pie chart showing the results. Check out it.
3) "It won't go to zero"
Whoever said financial advisors are boring. I'm not endorsing his opinion, style, singing voice or anything else but I applaud American Certified Financial Planner Ken Robinson's courage and creative delivery for waxing poetic in rap on market resilience and the importance of having a diversified portfolio. Robinson croons enthusiastically about mutual funds, which is basically what KiwiSaver is (except it's a long-term, no getting out before 65 variety). I didn't hear Robinson dissing fund mangers for fat or undeserved fees but I might have missed it. Make sure you don't. Find out what you are paying in fees and how that compares to similar funds and factor in the performance.
4) Dear boss, I quit
More fun and games for you today in personal finance land; Check out this clever resignation letter designed by a new dad who finally threw in the towel as a employee to pursue his passion as a baker. As someone who advocates passion pursuits for a living, I found it rather inspirational. Equally as interesting however, is the banter between the talk show hosts discussing his brazen move. One of them suggests the guy deserved to be fired for honing his craft while on the job. Hard to imagine how you can bake cakes at work without the boss noticing. Googling recipes for Marzipan icing on the other hand....Hmmm, maybe he's got a point?
5) Overpaid CEOs
One more tasty personal finance treat to conclude. Chief executive officers employed by America's biggest firms took home on average of US$12.3 million in total pay in 2012. That compares to an average of US$34,645 p.a. for their employees, or 354 times less.
You may, or may not be comforted to know that's a dilution from the year 2000 when the gap measured out at 525 times. Yikes.
Can't imagine New Zealand, given our scarcity of big corporations, comes anywhere close to that but I'd be keen to know. Anyone?
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You can also follow Amanda on Twitter @amandamorrall; check out her previous Take Fives here; Find out what she's up on on her own blog here. Or if you're into yoga, come to her Sunday class at Lululemon this Sunday at 8.30 a.m. in Ponsonby. We had about 70 yogis turn up last Sunday so come early.