GMB EP #101: Bitcoin ETFS Are Here

Bitcoin ETFs are here.

They’re not quite what you might think though. We walk through the details of how these beasts are structured and what you need to know before buying them in this week’s podcast episode.

Show Notes

[02:09] Recent Developments – Grant starts the discussion with a review of how and why cryptocurrencies grew in popularity over the last few years.

[04:37] Diversity of ETFs – How the diverse nature of the ETFs allowed them to utilize cryptocurrencies and the challenges associated with getting a cryptocurrency involved in a mainstream investment vehicle.

[08:12] Newcomers to the Market – Grant reviews a couple of newly introduced ETFs that are backed by Bitcoin and the pros and cons of investing in these compared to a traditional ETF.

[10:48] Futures Contracts – How the futures markets work and how they relate to the way crypto-backed ETFs function.

[14:36] Obscure Costs – Because of the way BTC-backed ETFs are connected to futures contracts, there are some costs involved in the process that may go unnoticed. Grant explains what investors need to keep in mind about the costs of the Bitcoin ETFs.

[16:41] Leveraged ETFs & Mutual Funds – Grant shares his thoughts on the functionality of the two investment vehicles and the similarities they share with Bitcoin ETFs.

[20:10] Bond Funds – Grant explains the difference between how bond funds operate versus investment vehicles based on futures contracts.

Resources

The Wall Street Journal – ETFs Are a Bad Way to Bet on Bitcoin:

wsj.com/articles/etfs-are-a-bad-way-to-bet-on-bitcoin-11635261745

The Wall Street Journal – Bitcoin ETF’s Success Could Come at Fundholders’ Expense:

wsj.com/articles/bitcoin-etfs-success-could-come-at-fundholders-expense-11635080580

GMB Ep #100: Reducing Small Business Health Insurance Costs With John Butler

Health insurance is an essential aspect in recruiting and retaining employees as well as sustaining productivity and employee happiness in a small business. In today’s episode, we have a distinguished guest, John Butler, joining us to take a deep dive into what business owners should know about health insurance. John is a national C-suite health benefits consultant, strategic coach, and the author of “Health Insurance Sucks,” the number one ranking book on Amazon in its category. Throughout this episode, John shares his insights on how businesses can reduce the cost of the health insurance they provide to their employees.

Show Notes

[02:22] John’s background – John shares his journey and what inspired him to write the book “Health Insurance Sucks.”

[05:25] Healthcare Costs – John explains his observations and findings on numerous methods to reduce healthcare costs.

[07:05] PEO – John describes how small businesses can benefit from Professional Employer Organizations.

[08:20] Custom Plan Solutions – With a comprehensive analysis, John points out how a custom health plan assures the highest quality service with a reasonable cost.

[18:56] Insurance Companies and Brokers – John talks about the relationship between insurance companies and brokers, and shares his thoughts from the perspective of each party.

[34:15] Federal Requirements – John explores the federal requirements and penalties related to employees’ health plans.

[38:54] Health Sharing Programs – John emphasizes the significance of health sharing programs.

[48:28] Current Social Context – The healthcare insurance industry consists of many complex layers. John shares his take on the healthcare plans in the current social context.

Resources

Connect with John Butler:

Website: jb-benefits.com/

LinkedIn: linkedin.com/in/jbbenefitsconsulting/

Mentioned in the Episode

Health Insurance Sucks – The Moral Case for Better Business Healthcare: goodreads.com/book/show/58502517-health-insurance-sucks—the-moral-case-for-better-business-healthcare?from_search=true&from_srp=true&qid=KIWCNRWz38&rank=1

GMB Ep #99: Maximizing Workplace Benefits With FSAs and HSAs

The open enrollment period for Flexible Spending Accounts (FSA) and Health Savings Accounts (HSA) is approaching. During the enrollment period, employees can enroll in or amend their contributions for the future year for FSAs and HSAs, which they can use to pay for their healthcare-related expenses. We dedicated today’s episode to taking a deep dive into several vital facts related to FSA, Dependent care FSA, HSA, and the numerous ways to maximize your workplace benefits under each of them.

Show Notes

[04:37] Flexible Spending Account (FSA) – Grant explains what FSA means, how it works, and who can contribute.

[07:55] Plan the Health Expenses – Why it is essential to forecast the health expenses to pay them on a tax-deferred basis through FSA versus paying out of pocket.

[09:18] Spend the Fund at Pharmacy – Beneficial features of FSAs, such as the ability to spend the funds at a pharmacy, and why having this option is significant.

[10:10] Dependent Care FSA – Grant explains the purpose of a Dependent Care FSA, its benefits, and several facts to keep in mind if you are considering using one.

[15:30] HSA – How to contribute to and HSA and the fantastic tax benefits and investment opportunities that come along with it

[19:12] Eligibility for HSA – Grant explains the eligibility requirements for HSAs, including having a High-Deductible Health Plan (HDHP).

[26:00] Connection to the employer – Grant discusses the connection between your HSA and your employer, and why employees can take their balance with them when they’re switching employers.

Resources

What Is a Flexible Spending Account (FSA)?
investopedia.com/terms/f/flexiblespendingaccount.asp

What Is a Health Savings Account (HSA)?
investopedia.com/terms/h/hsa.asp

GMB Ep #98: Everything You Need to Know About Medicare With Danielle Roberts

With the open enrollment period set to start on October 15^th 2021, this is a great time to dive deep into the vital facts related to Medicare. In today’s episode, we have a distinguished guest, Danielle Roberts, joining us. Danielle is a co-owner of Boomer Benefits, a firm dedicated to helping senior citizens make confident decisions when enrolling into Medicare, as well as the author of the best-selling book “10 Costly Medicare Mistakes You Can’t Afford to Make”. Throughout this episode, Danielle shares her wisdom on all the crucial points you need to know if you intend to enroll in Medicare.

Show Notes

[02:25] Danielle’s Background – Danielle introduces herself and explains what they do at Boomer Benefits.

[04:00] Common Mistakes – Danielle shares some of the most common mistakes she sees people make when enrolling for Medicare, and what you can do to avoid them.

[08:01] Parts of Medicare – Parts A, B, C, and D of Medicare and the differences between them.

[10:49] Medigap Plan and Medicare Advantage Plan – Danielle broadly describes the role of Medicare Advantage policy and the Medigap plans while highlighting their differences.

[16:59] Most Suitable Plan for You – Though 34% of beneficiaries choose Medicare advantage plans, Danielle explains how to be mindful when making the best decision for you.

[21:47] Subsequent Changes to the Plan – Danielle’s suggestions on how beneficiaries can change their enrolled plans in subsequent years.

[26:48] Switching Between Medigap Policies – Possible ways to switch between different Medigap policies and the procedures you’ll need to follow.

[28:59] Eligibly Criteria for Medicare – Danielle outlines the eligibility criteria for enrolling in Medicare.

[32:23] Medicare Fund – The correlation between the reserves in the Medicare fund and the benefits Medicare offers.

[38:08] Single-payer System – Danielle shares her insights on the rising health care costs and the viability of a single-payer system.

[42:23] Pharmaceuticals and Drugs – Grant and Danielle discuss some of the current trends in the pharmaceuticals industry and the business interests that may affect Medicare.

[47:09] Boomer Benefits – Danielle talks about how Boomer Benefits helps people with Medicare basics, benefits, and coverage.

Resources

Connect with Danielle Roberts:

Website: boomerbenefits.com/

YouTube: youtube.com/c/BoomerBenefits

Facebook Page: facebook.com/BoomerBenefits

Facebook Group: facebook.com/groups/BoomerBenefits

LinkedIn: linkedin.com/in/daniellekunkle/

Mentioned in the episode:

10 Costly Medicare Mistakes You Can’t Afford to Make:

goodreads.com/book/show/55204934-10-costly-medicare-mistakes-you-can-t-afford-to-make?from_search=true&from_srp=true&qid=1Wia7eTzTY&rank=1

The United States Social Security Website: ssa.gov/

Official U.S. government site for Medicare: medicare.gov/

GMB Ep #97: My Current Thinking on Cryptocurrency

A lot has happened in the cryptocurrency arena since we last covered this topic on Grow Money Business. Last week China announced that they are banning all activities in cryptocurrency while a month ago, El-Salvador announced that it would accept Bitcoin as a legal tender. In today’s episode, Grant shares his current thoughts and observations on cryptocurrency-related developments in the United States and around the world.

Show Notes

[02:46] Recent Events – Grant starts the conversation by briefly explaining the impact of both China and El Salvador’s approaches to using cryptocurrency.

[05:17] Benefits of Cryptocurrency – The benefits of cryptocurrency and why it is an appealing and convenient alternative for existing currency issues.

[07:05] Growing Chinese Economy – Grant compares the pace of China’s economic growth to the USA and reviews its intention of overtaking the USA as a world economic power.

[08:50] World Reserve Currency – Grant dives into the world reserve currency from numerous perspectives, including economic privileges that it opens for certain countries and why the USA needs US dollars as the world reserve currency.

[12:45] China and Cryptocurrency – The cryptocurrency activities in China before the government-imposed ban and Grant’s take on the reasons behind that government action.

[14:46] El Salvador and Cryptocurrency – El Salvador’s economic background and impacts on the country’s social context by encouraging citizens to transact in Bitcoin.

[15:52] Benefits and Challenges for El Salvador – The possible future occurrences related to cryptocurrency, as well as Grant’s take on the probable risks and benefits El Salvador may experience with the decision to accept cryptocurrency.

[18:40] Future Cryptocurrency Approach of Countries – The future measures of the world, and how China’s recent decision has knocked the price of cryptocurrencies.

[21:00] Increasing Credibility and Viability of Cryptocurrency – Grant explains the widespread adoption of cryptocurrency at the institutional level and how it has enhanced the credibility and viability of cryptocurrencies.

[22:58] Bitcoin and Ethereum – Cryptocurrency consists of numerous types of coins, including Bitcoins and Ethereum. Grant reveals his thoughts on the benefits and usage of each.

[28:01] Conclusion – Grant sums up his takes on recent changes of monetary and economic policies related to cryptocurrency and how countries will decide and set rules regarding cryptocurrency in the coming future.

Resources

Ep #65 – My Take on Bitcoin & Cryptocurrency

growmoneybusiness.libsyn.com/website/ep-65-my-take-on-bitcoin-cryptocurrency

Ep #64 – Where to Invest an Extra $50,000 Right Now

growmoneybusiness.libsyn.com/website/ep-64-where-to-invest-an-extra-50000-right-now

JPMorgan Warns Big Investors Are Suddenly Dumping Bitcoin for Ethereum Amid A $150 Billion Crypto Price Crash:

forbes.com/sites/billybambrough/2021/09/26/big-investors-are-suddenly-dumping-bitcoin

China’s top regulators ban crypto trading and mining, sending bitcoin tumbling:

reuters.com/world/china/china-central-bank-vows-crackdown-cryptocurrency-trading

GMB Ep #95: We Have a New Tax Bill [And It’s a Whopper]

The House Ways & Means Committee recently released proposed tax reform legislation that brings major changes to the current levels of taxation, including reversals of several provisions introduced in the Tax Cuts and Jobs Act of 2017. We dedicated this episode to exploring what this new proposal includes and some of the key aspects of the proposal that may interest our listeners. Throughout the episode, Grant dives deep into proposed provisions related to retirement, new tax brackets, business tax, tax on cryptocurrency, estate planning, and more.

Show Notes

[02:19] Background and Progress – Grant starts the conversation with a brief review of what led to this new proposed piece of legislation, its current status, and the path to getting it signed into law.

[08:16] Roth IRA Conversions – The proposed tax bill calls to prohibit Roth IRA conversions on after-tax contributions, which has been a very convenient maneuver for tax planning. Grant shares his thoughts on what to keep in mind if you’re considering a Roth IRA conversion.

[12:35] High-Income Earners – The new tax bill also brings provisions to restrict high-income earners from doing any Roth IRA conversions starting from 2031. Grant dives into the reasoning behind this, why this provision is proposed to come into effect ten years from now, and some other restrictions that apply to high-income earners.

[16:27] Mandatory Distributions – How the proposed new legislation mandates taking money out of your retirement accounts if the total value of all your retirement accounts exceeds a given threshold.

[20:00] Tax Brackets and Rates – Grant dives into how the tax brackets and applicable tax rates are updated in the proposed legislation and proposed changes to taxation on capital gains.

[27:47] Ultra-high Income – Grant shares his take on the 3 percent surtax proposed to apply for people who make over $5 million.

[29:47] Surtax on Trusts – The proposed legislation also brings provisions to add a surtax on trusts. Grant talks about the proposed tax brackets and rates related to trusts and what you should keep in mind when considering estate planning.

[31:08] Business Tax – How the proposed tax bill affects businesses depending on the type of business entity and some of the planning opportunities that emerge with the new proposal.

[35:35] Business Income Deductions – The new proposed legislation reforms a set of provisions related to business deductions that are introduced in the Tax Cuts and Jobs Act of 2017. Grant explains some of these reforms and what business owners should keep in mind about tax planning.

[39:02] Cryptocurrency Assets – Some of the tax-related legislations that apply to other assets such as stocks and bonds do not currently apply to cryptocurrency assets. Grant shares his thoughts on how that may change in the new proposed tax bill and what crypto investors show know about the new tax bill.

[42:26] Estate Planning – Another provision in the proposed tax bill brings some significant changes to taxes related to estate planning. Grant dives into what these updates include and what you should keep in mind about taking advantage of the current thresholds and exemptions.

Resources

https://waysandmeans.house.gov/media-center/press-releases/chairman-neal-announces-additional-days-markup-build-back-better-act

GMB Ep #94: 4 Tactics for Reducing Capital Gains Taxes on Appreciated Assets

Following the financial crisis of 2009, we entered one of the longest running bull markets in history. During this time, the Federal Reserve has injected a massive amount of US dollars into the monetary system, which has driven up the value of capital assets across the board. If you’re someone who holds equities or other assets at a substantial gain, you might be hesitant to sell them because of tax concerns. In today’s episode, Grant dives into four strategies you can use for exposure to appreciated assets and/or taxation when selling at a gain.

Show Notes

[02:29] Concentration and Risk – Why it’s risky to hold on to assets for too long and why it can be beneficial to repurpose your assets at the right time.

[07:57] Exchange Fund – Exchange funds can be used to diversify your holdings without triggering a taxable event. Grant shares his thoughts on the pros and cons of this method.

[13:28] Options – How to use stock options to reduce the risk of losing the value of your holdings during price fluctuations.

[20:05] Donor-advised Funds – Grant explores how donor-advised funds work and how investors can get tax benefits while contributing to charity.

[28:58] Charitable Remainder Trust – How charitable remainder trusts work, how they differ from donor-advised funds, and how to get started with them.

[34:38] Family & Insurance –Grant shares some ways you can reinvest the benefits of a charitable remainder trust to avoid financial stress within your family.

Resources

Donor-Advised Funds:
irs.gov/charities-non-profits/charitable-organizations/donor-advised-funds

Convert Appreciated Assets into Income with a Charitable Remainder Trust:
schwabcharitable.org/maximize-your-impact/develop-a-giving-strategy/align-your-giving-vehicles/charitable-remainder-trust

GMB Ep #92: Money Funds & Where to Park Your Emergency Cash

You are probably already familiar with the concept of reserving an emergency fund for unexpected expenses. You may even already have one in place. However, deciding how much to reserve or where to keep this money can be tricky. We dedicated this episode to exploring why you should maintain an emergency fund, how to determine how large yours should be, and a few different savings options that can be safe & accessible, while still giving you the greatest possible returns.

Show Notes

[02:09] Managing Emergency Cash – Why it’s crucial for everyone to set aside some emergency funds and the importance of keeping your cash in the right place.

[05:23] How Much to Save – Grant shares a method of estimating how much you should save as an emergency fund based on your income, expenses, and risk tolerance.

[08:31] Too Much in Cash – Why it’s a better idea to have your emergency savings as investments and the ideal investment method for your funds.

[12:17] CD Ladder & High Yield Savings – Grant explains how using multiple Certificates of Deposits and high yield savings accounts can help you make the most out of your emergency cash.

[16:36] Money Market Mutual Funds – How money market mutual funds work, how they’re different from money market savings accounts, and some of the recent reforms related to money market mutual funds.

[24:14] Types of Money Market Funds – How the reforms led to the creation of two types of money market funds, the differences between the two types, and what you should keep in mind about parking your emergency cash in a money market fund.

[28:24] Government Funds – The feasibility of putting your emergency cash in government funds and the benefits of utilizing multiple methods of investments.

Resources

Money-Market Funds Buckled in Two Crises in a Row. Regulators Look to Fix Them Again:
wsj.com/articles/money-market-funds-buckled-in-two-crises-in-a-row-regulators-look-to-fix-them-again-11626687001

Firms Wary as Money-Market Rule Changes Studied After Covid-19 Run:
wsj.com/articles/firms-wary-as-money-market-rule-changes-studied-after-covid-19-run-11630056602

GMB Ep #91: Why Mutual Fund Managers Are Converting to ETFs

One of the trends we’ve been recently observing is the tendency of mutual fund managers to convert their fund structure to Exchange-Traded Funds. Throughout this episode, Grant reviews the structures of mutual funds and ETFs, what makes them different from each other, the reasons why it makes sense for mutual fund managers to switch to ETFs, and what investors should keep in mind about mutual funds being converted to ETFs.

Show Notes

[01:43] Mutual Funds – Grant reviews how mutual funds are structured and how the mutual fund managers use funds from a group of investors to generate greater returns than what individual investors have the capacity to generate on their own.

[08:42] Limitations – Limitation of mutual funds and how these limitations may create unfavorable situations for mutual fund managers in some scenarios.

[13:50] Understanding ETFs – What led to the creation of Exchange-traded Funds, how they work, and the difference between mutual funds and ETFs.

[21:51] Benefits – Grant dives into the attractive characteristics and tax benefits of exchange-traded funds.

[25:00] Popularity of ETFs – Grant shares his thoughts on how ETFs became popular in the last decade and the trend of some mutual funds being converted to ETFs.

[30:00] Why Investors Should Care – How this trend of mutual fund managers converting their structure to ETFs affects the investors in terms of expenses, taxation, benefits, and what to do if their mutual funds are being converted.

Resources

Investor Bulletin: Mutual Fund Conversion to Exchange-Traded Fund (ETF):
investor.gov/introduction-investing/general-resources/news-alerts/alerts-bulletins/mutual-fund-conversion-exchange-traded-fund

Making the Switch: Turning a Mutual Fund into an Exchange-Traded Fund:
bbh.com/us/en/insights/investor-services-insights/making-the-switch-turning-a-mutual-fund-into-an-exchangetraded.html

GMB Ep #88: How Securities Lending Drives Down Investment Costs

Securities lending is one of the widely misunderstood concepts in the investment community, and securities lending shows up intermittently in the news for both positive and negative reasons. However, this complex trading pattern driven by short selling can drive down costs for the investors. In today’s episode, Grant dives deep into how securities lending works, the different parties involved in it and their roles, how investors participate in securities lending, and how it impacts the performance and costs of ETFs and mutual funds.

Show Notes

[02:40] Understanding Securities Lending – How securities lending works, how it relates to investment funds that many people put their money in, and how it generates revenue for brokerage firms.

[07:13] Trading Settlement – The process of trading securities is a bit more complex than it looks from the outside. Grant reviews how trade settlements work and how securities lending comes into play.

[12:50] Short-Squeeze – How unexpected fluctuations in stock price can cause investors to lose money in certain scenarios.

[13:47] Driven by Short Selling – Grant reviews how securities lending transactions between several parties create a complex ecosystem that facilitates short selling and how the demand for securities lending is driven by short selling.

[16:23] Supply and Demand – How brokerage firms can make money through securities lending depending on the demand for shares.

[19:10] Sources of Supply – Grant explains the sources brokerage firms use to get the securities they lend to other parties and how investors can make money by lending securities to brokerage firms in some scenarios.

[21:40] ETFs and Mutual Funds – How ETFs and mutual funds are involved in securities lending as another source of supply and how it benefits investors by reducing expenses.

[27:20] Facilitating Short Selling – A common argument about securities lending is that you may not want your shares to be lent out because you don’t want to facilitate short selling in a company that you own. Grant shares his take on the relevance of this idea.

Resources

My Take On Short Selling: www.abovethecanopy.us/my-take-on-short-selling/