Dear Natalie: My broker lost over half of my nest egg. That was literally hundreds of thousands of dollars -- more than the cost of my house in Venice, California. What happened and how can I resurrect my portfolio?

November 5, 2008

Dear Friend,


If you are over 25 and you lost more than 25% your nest egg was cracked to begin with.



The choices you were given were wrong.



You weren’t given any guidance.



Brokers were paid on commission to sell you things.



The more they sell you, the more cracked your nest egg is.



You should always keep a percentage equal to your age safe.



Stocks are not safe.



Stocks over the last ten years earned 4% gains per year with a lot of risk.



Treasury Bills earned 3.3% per year with almost no risk.



25 year-olds who employed my “recession-proof” strategy would have lost less than 20% in October 2008.



50 year-olds would have lost a maximum of 11%.



Bill and Nilo Bolden lost nothing at all using a pie chart that I drew up on a napkin for them.



I’ve achieved #1 ranking as a top stock picker.



I’m not a fuddy duddy. Your existing plan is.



You own stock in dying industries.



You don’t have to.



Your nest egg should grow during the boom periods of NASDAQ, real estate and clean energy.



Using your plan, you were dancing on the ceiling when it exploded and then devastated when it popped.



“What happened,” you wondered.



Using my plan, you would be enjoying those gains.



Green Goddess Club Member Kavi Ladnier

The Green Goddesses Investment Club earned almost 40% gains in their first trade ever in this crappy, down-trending market.


Your nest egg is on life support. The man with the plan is hiding under his desk, or shrugging, or making excuses or quit.



Watching your gains jump and then pop creates a lot of stress and stomach acid.



Sometimes it’s much worse than that.



Green Goddess Club Member Brianna Brown


There is a better way.



Most people don’t know about it because the old way pays high commissions and is familiar.



You think you don’t have a choice.



You can’t understand why your certified financial professional didn’t do a better job for you.



The new way is far better and is very easy.




Green Goddess Investment Club founders Cindy Ciscowski, Shelley Silver Whizin and Brianna Brown.


The guy who wrote the plan half a century ago won a Nobel Laureate in 1990.



Exchange Traded Funds have been around for more than a decade.



So have I.



I’m a #1 stock picker.


Google, Myspace, Taser International, Sohu. com, Suntech Power Holdings, Rio Tino – I found them first.



I warned to trim Fannie Mae out of your nest egg in 2003.



I warned to get General Motors out of your mutual fund holdings in 2004 (when I said to buy Google at the IPO).



I told you the housing bubble would pop in 2005 and to avoid REITs.



Lehman Brothers was issued a warning on my June 2006 stock report card in BOLD CAPS.



Bear Stearns was so bad, it didn’t make the grade to be included on the stock report card.



You can play it safe and be an owner in corporations that are making great products that we all adore.



You can get rich and enrich the world at the same time.



Here’s how the strategy of Modern Portfolio Theory (plus ETFs) works:

1.

Invest in emerging products, energy and technology, not dying industries
2.

Invest in wisdom, not the old way of doing things
3.

Diversify and rebalance with a wealth blueprint that is appropriate to your age, instead
of blind faith, buy and hold whatever my broker says
4.

Know what you own instead of holding a big basket of everything, including companies
you despise

It’s easier than you think, faster than you can imagine and more effective than any other strategy on Wall Street for Main Street investors…

We can take a trillion dollars out of oil and find a cleaner way to power our world – overnight.



We can take $130 billion dollars out of cigarette companies and run marathons to lower our blood pressure and improve our health.



We live in the land of the free and the home of the brave.



We don’t need handouts or bailouts. We are the fabric of the can-do spirit.



We invent whatever we can imagine and continuously beautify our world.



We are the most generous nation on the planet.



We are one of the most free nations on the planet.



We can create a more peaceful, beautiful world that works better for everyone.



Please order my book Put Your Money Where Your Heart Is now to learn how to resurrect and nourish your nest egg back to health.

Go to BarnesandNoble. com, Amazon. com, Borders. com, Overstock. com or your favorite bookselling website now to pre-order my book.



Consider coming to my November 20-22, 2008 Get Rich and Enrich Retreat.

(Get more information on the home page at NataliePace. com and sign up NOW at the JOIN NOW link at NataliePace. com.

) The retreat includes a free 21-day coaching call series and also a free one-year premium subscription, so that you receive ongoing support all year long.



You watched your nest egg binge and purge twice now in the last eight years.



When you have a healthy plan, you can eat a little dessert and still look great naked. (This metaphor applies to your nest egg as well. Think about it.

)

Your old plan didn’t work. Twice. (DOT COM bust happened first.

Remember?)

Stocks paid 4%/year over the last ten years, not 12%/year.



Please order my book Put Your Money Where Your Heart Is now to learn how to take ownership of a cleaner, greener, more beautiful world (and get rich while you’re at it)

You currently own a lot of companies that you despise.



You are losing money while you close your eyes and hook your future on blind faith (which hasn’t worked so well for you in the past and won’t work in the future).



Get smart, get rich and enrich our world.



Put Your Money Where Your Heart by Natalie Pace is available for pre-order now at your favorite online bookseller (Amazon. com, BarnesandNoble. com, Borders. com, Overstock. com, etc.).



There is no better time than now.



You can learn more about how to “Resurrect Your Nest Egg” in the November 2008 ezine, volume 5, issue 11, at NataliePace. com.



Sign up for 30 days free at the Join Now link to check it out.



Come to my 3-day retreat November 20-22, 2008 and you will implement these strategies into your own nest egg right then and there.

Sign up now at the JOIN NOW link at NataliePace. com.



With a new plan, all you need to do is rebalance twice a year.



Easy, really. If you commit to learning and taking control of your own life and ownership in our world.



A good strategy will create a better world for you and your family and for the world as well.



More whining will get you nowhere.



Thank you for your time.



Please pass this email onto a dozen friends who need to hear this.



Yours in peace and prosperity (yes, you can have it all),

Natalie Pace
Author of Put Your Money Where Your Heart Is
#1 stock picker
founder and CEO, NataliePace.
com

www. NataliePace.
com
Heather@NataliePace.com
P.O.

Box 1350
Santa Monica, CA 90406-1350
866.476.

7442

Ask Natalie: Are the Money Markets Safe Now?

Ask Natalie: Are the Money Markets Safe Now?

So, I happen to be in the over 50 category. Last spring after reading the book The Trillion Dollar Meltdown (which PublicAffairs will be bringing out soon in paperback, renamed The Two Trillion Dollar Meltdown), I decided to move some of my IRA money that was invested in one of those age-appropriate retirement mutual funds (so, supposedly, they are watching how the portfolio should be balanced) into a money market fund. I told my banker-son that I was going to do this, and he told me not to do it. But I did it anyway. A money market fund still didn’t feel really safe, but it seemed like the best answer under the circumstances. But I still have other money in that retirement mutual fund… Now I guess we’ll see if the money in the money market fund is the extent of my retirement funds.

The website for the company that runs my money market fund says that they are going to take/accept the new “insurance” for money market funds, and that the insurance will only last for 3-4 months. Had you heard that?

Hmmm... Treasury Bills are safer than the money markets these days — if you can make the move now, I’d do it. Much better to avoid potential losses than to have to file a claim. There are Treasury Bill ETFs available. Try PLW, the PowerShares Laddered Treasury ETF. You can also check out iShares.com, AMEX.com, PowerShares.com to see what other Treasury Bill options are available.

With regard to the rest of your mutual funds. Check out the pie charts in the article, "Bill and Nilo Bolden’s Very Healthy Nest Egg (and How You Can Have One, Too!)," from the October 2008 ezine, vol. 5, iss. 10, at NataliePace.com.



Investing in mutual funds means that you don’t really get the benefit of having the diversification across those industries, sizes and styles. Doing that kind of investing and meeting with a CFP twice a year means that you would always be protected from boom/bust cycles because you would be taking profits and redistributing them (called rebalancing). In that scenario, you are able to buy low and sell high into funds, without too much trouble.

For instance, if you had 6.25% in small caps — 12.5% total because you have small cap value and small cap growth — prior to 2000, when you met with your CFP in January 2000, you would have seen that your small caps (NASDAQ DOT COM STOCKS) had swollen to become 50% of your portfolio. You could have sold some of those funds (for a great gain!), redeployed the money across your blueprint (keeping % equal to age safe and the rest diversified by industry, size and style), and you would have been VERY protected from the DOT COM BUST. You would also have been buying LOW into the Dow Jones Blue Chip stocks (the large caps) because those would have shrunk a bit. (Incidentally, the Dow performed MUCH BETTER than NASDAQ 2000-2002). So this kind of diversification really works great, especially combined with two meetings a year with your CFP to rebalance, redistribute and make sure that you are aligned with your Buy My Own Island investment blue print.

Essentially, you are the architect of your dreams and the CFP is the builder. My book, fortunately, helps the average person be a better architect. There is a new trend in brokers where they are paid on money under management (even at some of the discount brokerages), which is more in line with the best interests of the investor — but this was NOT the case in the past, when brokers were paid on commissions for the mutual funds they sold. The trend is just beginning so it is vital that investors know how to protect and grow their own nest egg — AND how to pick a great certified financial life partner. You can get tips for this in the “How To Find a Broker” article, under the Investor Edu section of NataliePace.com.



Now, in the “have a little faith department,” there are two points. One: The markets return on average over 11% per year, including bear markets, recession and the depression. So, provided you don’t have to retire tomorrow, your portfolio could still recover. It will recover more quickly if you have diversified investments, and particularly, if you include clean energy in your portfolio. Clean energy (solar, wind, electric cars, etc.) was the top performing industry in 2007, earning almost 60 cents on the dollar — almost double the returns of oil!!!

Roger and I are working on a way to get more of this information to your team. So, keep asking questions because they may well form the basis of a great Q&A that benefits everyone around you.

Unfortunately, not all of the old school mutual fund companies offer the new targeted funds — like ETFs do, so it may require having HR take a serious look at what the options are, and perhaps consider a new company with fund options that allow people to diversify better.

Hot Tips Are Not Hot Stocks

Ask Natalie: Hot Tips Are Not Hot Stocks. Subscribers chat with Natalie Pace.


Dear Natalie,

Have you done a report card on Aussie Soles, AUSE? What do you think of this company and its potential?

Thank you!
Cynthia

Hi Cynthia. Thanks for writing to me. Here’s a 5-minute analysis of Aussie Soles.
The first thing that I do when I’m researching a company is enter the stock symbol in the Company Research box on the home page at NataliePace.com. That takes me to the stock page. From there, I click on Company Report (located on the left navigation bar), which usually provides a description of what the company does. On the company report of Aussie Soles, there is no description available. It’s not available because the company is trading off the boards.

Companies that trade “off the big boards” are EXTREMELY HIGH RISK because they haven’t met the criteria to list on NASDAQ or the New York Stock Exchange. That fact alone will end my research right there, unless there is a very compelling story going on.
Wisdom Tree was trading off the boards when I featured it, as was U.S. Gold. Both companies had incredible executive pedigrees, interesting industries and products, and lots of money to launch with. All of these things have to be present and impressive to the nines before an off the boards stock looks interesting to me. And after a brief look around the Aussie Soles website, it looks like the founder, President and CEO, Craig Taplin, is the only person on staff!

So, at this point, I have more questions for you than I have answers.
Why are you interested in Aussie Soles? Did you get a hot tip from someone or do you just like the shoes? If you love the shoe and think it’s going to be the next great breakthrough thing, then you need to look deeply into the executive suite to see who is going to make it all happen. It takes experience and an outstanding marketing, sales and distribution plan to make anything the next great sensation!

If Aussie Soles was a hot tip, chances are that someone was paid to give it to you. Hot stock tips are usually expensive lessons, unless they come directly from Warren Buffett. The phishing and pump and dump scams are getting so sophisticated that agencies like the Securities and Exchange Commission and FINRA.org are constantly publishing Investor Alerts to foreworn you. In fact, be sure to check out the SEC alert that I’ve published in this month’s ezine, entitled, “’Wrong Numbers’ and Stock Tips on Your Answering Machine.”

I’ve started a topic on Aussie Soles on the NataliePace.com Sharing wisdom bulletin board, so that you can answer some of these questions. I hope you tell us more about why you are interested in this company, so that others can all learn from your experience. I think I’ve seen the shoes around, so perhaps you think you’re early on a fad? Could be! Very high risk, however, especially since we don’t know much about the founder/CEO and the rest of the team.

Brokers and Husbands: It Pays To Pick A Good One

10 Hard Questions to Ask Your Broker and Yourself
Natalie Pace CEO & Founder, NataliePace.com



Arguably, your broker and your life partner are the two most important decisions that you’ll make in your life. (You don’t get to choose your family…) So, why do we spend so much time, attention and money on the courtship, wedding and honeymoon, and so little on finding the perfect someone to oversee the estate?

Many investors approach finding a financial professional like they do finding a job, thinking they have to sell themselves to win the relationship. Instead, you should be treating the broker as you would a fiancée. Don’t sell yourself to them. Make sure that they are worthy of you. Dig into their past. Ask the hard questions. Your life, your needs, your risk tolerance and your areas of expertise are specific to you, and if any financial professional starts laying out a cookie cutter plan for your money, that is the first red flag that you’re dealing with a salesperson, instead of a professional who is looking to develop a mutually beneficial long-term relationship.

Ideally, your certified financial planner, real estate broker and other financial professionals are here to find the perfect investments based upon your needs. So, why is it that so many of us expect them to be mind readers, and then fire them if the shoes don’t fit or the investments don’t pan out? If you’re looking for a remodel in downtown Los Angeles, you don’t want to consult an estate broker in Beverly Hills. Likewise, if you have major tax considerations and need to protect an existing portfolio, you don’t want to hand the reins to a hedge fund manager.

Is your financial planner someone you can respect, admire and honor through thick and thin? If not, you’re setting yourself up for losses, because at the first sign of real trouble, you’ll be faced with the hard truth that you knew all along—it was a bad match to begin with. You don’t want to be stuck in the foxhole with a jerk. An experienced professional will be an ally, seeing you through the hard times and drinking to success on the other side. All markets – real estate, bond and stocks – have their rallies and their pullbacks. Investing, like life, isn’t a fairy tale, but if you pick an outstanding partner, it can be a rich and rewarding adventure.

10 Things to Know About Your Broker:

1. How many years has s/he been handling portfolios and/or trading stocks and bonds?
2. What is her/his education (university)? (Brokers do not have to be college graduates)
3. What financial certifications does s/he hold?
4. What is her/his investment style?
5. What is her research criteria? (If they rely solely on "what the company tells them to pitch," they are likely more driven by company sales incentives than real gains in your portfolio.)
6. What is the performance of her client’s portfolios? (Be careful that you don’t get a bait and switch on this one, where they point you to mutual fund pie charts, where the years have been carefully selected to present a positive picture.)
7. Years of employment with current company (and where s/he worked before).
8. Any complaints filed with the NASD? (Call the NASD to verify that there haven’t been any complaints.)
9. How much time and energy will s/he give to my portfolio?
10. How many market downturns has s/he personally been through in her field? (Don’t confuse wisdom with a bull market. This would be particularly relevant to young real estate brokers right now.)

4 Questions Your Broker Should be Asking You:

1. What is your favorite investment strategy? (Do you have experience making real gains in any one sector?)
2. What is your least favorite investment strategy and why? (Do you hate the THE NASDAQ because you lost money in 2000?)
3. How is your portfolio currently positioned (diversified)?
4. What is your risk tolerance? (No investment is worth a heart attack!)

Please note that Natalie Pace and NataliePace.com are not brokerages or in the business of advising people about their personal finances. NataliePace.com offers the news and information you need to make smarter investment choices (with the help of your financial professional). Always consult financial professionals, including your accountant, before making changes to your portfolio.

Should I Pay Down Debt with my Tax Refund?

Ask Natalie: Should I Use My Tax Refund to Pay Down Debt?

Dear Natalie. The IRS is sending out stimulus checks to all taxpayers, plus I’m getting another $5,000 back in my tax refund. Should I pay down the debt on my credit cards, take a vacation or invest the money? My wife and I can’t agree. Help! Signed: Vacation Happy

Dear Vacation Happy: If you’ve ever played my Billionaire Game, then you know that I believe there is a divine flow of money that, when followed, leads to the rich life. The Billionaire Game takes you through the process of how you would spend that money if you had all the money in the world. When you apply that logic and those disciplines to your current situation, then the right answer for your and your wife becomes VERY clear! So, take the time to play the Billionaire Game with your wife to help resolve this. You can get the details of the Billionaire Game in the volume 5, issue 3 NataliePace.com ezine.

According to an Associated Press-AOL Money & Finance poll released on April 10, 2008, the majority of Americans are spending their refunds this year to pay bills and to pay down debt. As a point of policy, I don’t think that is a good idea, for a number of reasons. In the natural world, what you focus on expands. If you focus on debt or if you’re stuck in the rut of basic needs and survival, you never get out of it largely because you haven’t changed the habits that got you into debt in the first place. If you focus on wealth creation strategies, then you step into a healthy relationship with money that allows you to earn more and spend less in a more balanced way, while eliminating your debt and making sure it never builds up to an albatross again.

Let’s say that $5,000 refund was a $1,000,000 inheritance that you just received. If you thought about paying down $100,000 debt first, then you wipe 1/10 of your money out of the inheritance and bring the principle down to $900,000. If you invested the money, then your debt could be paid with the returns, as average returns on $1,000,000 are 10% annually, or $100,000 per year. In that scenario, your debt could be paid off in one year, and you preserve all of your principle. The following year, you should have $100,000 income (that 10% return) to enrich your lifestyle.

Put your debt on a payment plan that is consistent with the 50% to survive and 50% to thrive "Buy My Own Island" plan that is outlined in the Billionaire Game. (Debt repayment is part of your survival, incidentally, not your thriving.) The reality is that when you get your debt on a payment plan, get your spending in line with the Thrive budget and focus on increasing your monthly income through your job as well as your investments, you are embracing a strategy that works. When you try to decrease debt simply by making a lump sum payment, the odds that you build it up again are extremely high, because your income hasn’t increased, your spending hasn’t decreased, your investments haven’t flourished and your skill level hasn’t improved. In order to become wealthier than you are today, all of those things should be addressed – more income, more education, more skills, better investing habits and a lower monthly nut!

As an example of how this works, there was a woman we’ll call Wendy. Wendy had put about $30,000 on credit cards when she was launching her business in 2003. Her business wasn’t doing so well, so by 2005, she was barely paying the minimum payment each month. As a result, the penalties and interest had doubled her debt to almost $60,000. Wendy called the credit card company, told them her dire situation and started a monthly payment plan of a minimum amount that she could afford at the time. In 2008, Wendy was contacted by the debt collector at the credit card company and asked if she was interested in setting up a repay plan that was more acceptable to the company.

The debt collector was initially aggressive about the principal and need for a high payment, which was much higher than anything Wendy could really afford. When the collector said, "But your debt is almost $60,000!" Wendy responded by pointing out that half of the debt was penalties and interest. She also noted that she’d been faithful about making payments on the debt, even though her business had been struggling.

As a result of religiously paying the minimum payment over the last three years and pointing out to the debt collector that original amount owed was only $30,000, Wendy was able negotiate a new principal of $45,000 and monthly payments to pay off the debt, which were well within her ability to repay. If Wendy continues to make her payments on time, there will be no further penalties or interest on the account.

With that out of the way, Wendy focused on getting a book deal to promote her business, on getting her business cash positive and partnering with some big partners in achieving her goal. That focus resulted in a lot more income to her. More income means that she has the ability to make bigger monthly payments on the debt going forward, and potentially even under better terms. On the other hand, if Wendy’s focus had been solely on paying down debt, instead of on business expansion as well, she might have made a slightly larger payment, but nothing close to the $15,000 of the debt, which was written off. And who knows if she would have gotten into a position of earning more income so quickly!

Debt is similar to dieting. When you adopt healthy eating habits, you’re more likely to lose weight and never gain it back. When you "diet," you’re more likely to yo-yo between weight loss and weight gain. When you adopt healthy fiscal habits, you’re more likely to create wealth. When you try to pay down debt in one lump sum, you’re more likely to balloon back up to serious debt fairly quickly, which keeps you too sad, depressed and at wit’s end to focus on wealth generating strategies and investments!

In short, the good news, Vacation Happy, is that a healthy approach to money includes fun, so you get to have your vacation, your investments and to pay down debt, too! If you really want to get into the flow of prosperity, that $5,000 plus refund should also include two items that were not on your list – charity and education. There is no reason to stay trapped in yo-yo debt dieting, when you can adopt the habits of the very wealthy and start living a richer life right here and now.

Be sure to share where you go, what you invest in and the fantastic results of your own debt repayment negotiations at my AskNatalie blog at http://asknataliepace.blogspot.com/!

Should You Pick Up the Check?

You Are Sexy, Sassy and Smart.

So Should You Pick Up the Check?

by Natalie Pace.



Demi Moore and Ashton Kutcher

Fortunately, thanks to the hard work of the women who have come before us, American women are free, free, free to get an education and get pretty much any job we desire, so, thankfully, many of us can afford to pick up our own checks. But should you? Or should you politely excuse yourself to the powder room just before the check arrives, to allow him to make the choice? Should you discuss it beforehand? Should you take charge and just snatch the bill before he does? As if procreating the species and having a monthly period wasn't hard enough, now we have to figure out an entirely new mating dance! Who picks up the check?!!

The question really isn't whether or not you should pick up the check. The question is: what kind of relationship are you interested in? Once you are in a relationship, you'll be giving your hot guy a say in a lot of things, but when you are just dating, your job is simple. You need to pick the right dream guy so your time together doesn't become a nightmare. Now, picking up the check (or not) sends a relationship signal to your date early on about the kind of relationship that you are interested in. So be sure that you are smart about the message you send, so that you are setting yourself up for the relationship you truly desire!

Are you more of a Demi, a Princess Di or a Hillary?

Girls Who Pick Up.
* Do you like treating your friends to a good time?
* Are you so wealthy that the only guy who can pick up your check is Stavros Niarchos III?
* Do you own your own Gulfstream jet?




Let's face it. Britney Spears could have dated one of the Google founders, if she wanted to play Grace Kelly in the relationship. Whether it was a conscious choice or not, she picked a dancer to be her husband and the father of her son. Since the goal is to be sexy, sassy, smart and happy, make sure you make your choices before you start drinking! If you have more money than the Queen of England (like J.K. Rowling does), or have a dream job that you want to place first in the relationship, and/or are looking for someone to play a supportive role to you, then, by all means, reach for the check (with all of the femininity that you desire to summon) on ALL of your first dates.

The challenge of a woman who rules the roost in a relationship is finding a great guy and not just a leech who is fawning all over you because he can't afford his own cover charge! Demi Moore didn't do so badly with Ashton!!

Girls Who Are Provided For.





American girls are doing pretty well in the Queen department. Grace Kelly, the Queen of Monaco and Princess Caroline's mother, was an American actress when Prince Rainier came calling. Queen Noor of Jordan, originally of California, was a Princeton graduate who dreamed of working in the Peace Corps when King Hussein asked her to marry him.
Queen Noor chairs the first meeting of KHF Board of Trustees, June 30, 1999.
Queen Noor is now one of the most important voices for peace in the world, and, even more importantly, in the Middle East. She is Chairman of the Board of Trustees of the King Hussein Foundation, proving that playing a supportive role to a great man is not such a bad gig. (Note: a great partner is the key in all of these scenarios.)

Girls Who Want an Equal Partnership (and Pick Up the Check Sometimes)



Politics aside, you have to admire the strength of the Clinton's marriage and relationship. (It can be argued that Hillary picked a great, horny man. She's been quoted as saying, "It's hard to keep an old dog on the porch.") During his Presidency, Bill Clinton gave Hillary more power and influence than any other First Lady in history. She leveraged that into winning a seat in the Senate, and is now a leading Presidential contender for the next Democratic primary, with one of the most popular and powerful world leaders as her biggest cheerleader!

So, to pay or not to pay is an important choice! But, the most important decision you'll ever make isn't who pays, but picking a great partner. Brokers and Lovers: It pays to pick a good one, regardless of who buys lunch.



Take the NataliePace.com Online Survey: Should a woman pick up the check on a date? Go to the home page at NataliePace.com. Click on any survey, and you will be taken to the Survey page, where you can participate in all three online surveys, including our date protocol survey.

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go to NataliePace.com
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