One thing you notice when you watch a lot of golf on tv is that the same commercials are repeated over and over ad nauseum. This past week was no exception. I must have seen the ING Your Number commercial at least 10 times. Clearly their marketing tactic worked, because I did indeed go to their website.

The premise of the commercial is that everyone has a number that correlates to the amount they’ll need to have saved to retire when and how they want. In the ad, people are carrying around a physical number. By going to the website, you can calculate your number and then find a new financial professional in your area or email it to your existing one.

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There’s no doubt that social lending is gaining in popularity and growing in numbers every day. More and more you hear of P2P lending being described as an investment because of the sizable returns that are often possible. Opinions vary about whether or not it is a good investment, but I’d like to consider whether it’s a socially responsible investment.

For anyone who hasn’t heard of socially responsible investing, here’s an excerpt from a post I wrote on the subject:

“The practice involves trying to maximize financial return while investing in companies that are deemed socially good. Such companies tend to favor policies of environmental friendliness, workplace diversity, fair treatment of workers, etc. Many socially responsible investors also avoid companies involved with alcohol, tobacco, and gambling as well as big oil or military contractors.”

The difficulty in determining whether social lending is socially responsible is the fact

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Value cost averaging is yet another way to invest your money on a periodic basis. The strategy is similar to dollar cost averaging in that you make regular investments regardless of the current price of a stock. Instead of investing the same amount of money each time, like dollar cost averaging, you add a fixed value to your investment each time. So if you chose a value of $1000, then you would purchase $1000 worth of stock initially. You would use your second investment to bring the value of that holding to $2000. The third would bring it to $3000, and so on.

As the price of your chosen stock ebbs and flows, you would be investing different amount of money and purchasing different amounts of stock with each investment. So if you bought 100 shares at $10 each in the first round, you’d need to see what that was worth before your second purchase. Let’s say that the stock was worth $10.50 at your next investment,

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As someone who is debt free in all other aspects of my life, it’s probably not surprising that I prepay my mortgage. By prepaying, I mean paying more than the required payment each month. This will allow me to pay off my mortgage in about a third of the time. I’ll save a ton on interest and it seems like good financial sense, but there are some opposing views to consider. The fact that opinions vary so widely on the subject is a good indication that the right answer is highly dependent on your personal situation. Statements like “prepay 10% extra each month and you’ll be in a great position” are of no real value to anyone. There are simply too many other factors:

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As difficult as is can be to decide when to buy an investment, knowing when to sell can be even more difficult. This is particularly true of losing investments. When our investments decline, the decision needs to be made whether to cut our losses, do nothing, or invest more to take advantage of the lower price.

I wish that I could say that there’s a tried and true rule, such as when an investment has declined by a certain percentage, but there are too many other factors. The type of investment, time held, tax consequences of a sale, risk/reward profile, and countless other pieces of information go into the decision. Another aspect of selling a loser is that you have to admit that you may have made a mistake. Far too often people hold on to their losers, hoping for a turnaround. What’s worse: getting out of an investment only to see it recover or to hold on and watch a continued decline?

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I keenly remember the excitement that surrounded my first read of a book that has become a financal classic: Rich Dad, Poor Dad by Robert T. Kiyosaki. It wasn’t just the philosophical difference in how assets are traditionally defined (things you own with perceived value) versus the author’s new definition (things that put money into your pocket each month.) No, the real excitement came from the practical application that accompanied that definition: investing in rental property.

For all of the benefits that come along with finding a rental property with positive cash flow, the downsides (even if only perceived to be so) hold people back from such an investment. Even though the author provided many solutions (such as hiring a property manager) to the typical complaints of those opposed to rental property (such as “I don’t want to fix toilets”) there were still some things that were holding me back too. I liked the idea of investing in something that paid me back regularly, but the overhead and management of a rental property business dissuaded me from the investment.

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When Forever Stamps were first introduced, lots of people seemed to think of them as a great investment. A Forever Stamp is sold at the current 1st class postage rate (41 cents when introduced) and is valid 1st class postage forever, regardless of the cost of 1st class stamps in the future.The investment angle works like this: Buy a lot of Forever Stamps at the current rate and then sell them for a price between what you paid and the new rate once stamp prices go up.

Here’s the problem…

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Although your 401(k) is better than not saving for retirement, your investment options there are limited to the offering of your particular plan. You likely have a dozen or less funds to choose from. The likelihood of those offerings being the ones you would have chosen given choice over all investment options is basically zero.

So my retirement investment allocation goes along these lines: Make getting the company match on your 401(k) retirement investment priority number one. Even with poor choices in your 401(k), the company match is free money. If your company match gives you fifty cents on the dollar, that’s a 50% gain on your investment regardless of the performance. Better matching means even better gains. So contributing enough to get the full company match is a no-brainer.

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The recent volatility in the stock market, along with what appears to be a sagging economy, has led a lot of people to believe that the crash of 87 is an event likely to repeat. Of course, given a flimsy economic stimulus package and one day of positive gains on the stock market, many people are already saying this crisis has been averted.

Short term predictions are mainly a guessing game. There are just too many variables to accurately say what the stock market may do in the next days or weeks. Longer term trends are easier to read and thus make more accurate predictions.

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Using stops gets more complicated when trading options because options tend to be more thinly traded. So you might set a stop for $3 on an option that has a bid of $3.10 and and ask of $3.30.

As the underlying stock declines, the bids and asks may decline together without ever being met. So the ask might go to $3.20 when the bid is at $3.00, $3.00 when the bid is at $2.75, etc. If no options are actually traded in that range, you can see how the trend might continue until the options are worth much less then your stop price. The option might not actually trade until the the bid and ask are much lower.

The intent of your stop was to place your order when the bid got down to $3.00 or lower, but the possibility that the option doesn’t trade at that level means that your stop is useless. So pay extra close attention if you use stops for options. You can’t rely on them to protect you nearly as well as you can for more heavily traded stocks.