Housing and the Obama Stimulus Package

Dear Fellow Consumer, here is our take on the Stimulus Bill and Treasury announcements made this week. We look at the Stimulus package AND the Treasury's package holistically, in compliment with each other - mostly because that's how the Obama team is looking at it.

The National Association Realtors Board of Directors, asked in November to do 4 things (with an unspoken but clearly understood mandate to PRESERVE what we already have). Here they are:

• - Get loan limits raised for high cost areas,

• - Make the $7,500 tax credit NOT a loan,

• - Try to find ways to push interest rates down (which are higher than they should be due to systemic risk right now) by 200 basis points, and

• - Help provide solutions to the foreclosure/short sale problem.

So here's what was achieved:

• - The loan limits will be raised to $727,000 in high cost areas,

• - The tax credit will be raised to $8,000 with NO payback [a true credit],

• - Interest rates have come down 125-150 basis points, and

• - The bill has over $50 billion in it for foreclosure mitigation, with Geitner's Treasury plan signaling that the second half of TARP and TALF will be used to mitigate foreclosures through a government guarantee, drive down interest rates by buying another $200-300 billion of mortgage paper from the GSES's thereby freeing them up to do the same with new mortgages, and Fannie has just agreed to lift the cap of 4 investment properties eligible for loans and raise it to 10.

In addition, we preserved what we have - which some tend to forget is always on the table when these negotiations start up again - mortgage interest deductibility, real estate tax deduct ability, and the $250,000/$500,000 cap gains exclusion (an overall package worth more than $100 billion and for some a very attractive funding source for their pet projects).

We did make a run at the $15,000 credit -- and we would have loved to have gotten that or the Homebuilders $22,000 credit idea as well as their 5 year loss carry back deal, but they were considered too rich for this program. What it did do though is totally take the debate off of whether a tax credit should be reinstated at all (it expired last year) and whether it was a true credit or a repayable loan, and kept the conversation on how much it should be. It also kept the debate off of 'what we are willing to give up to get a $15,000 tax credit' and kept the debate again, on how much it should be. It's pretty hard to complain when they give you what you ask for and you lose something you never had.

While we study the Treasury specifics on their major role in providing the rest of the housing solution -- there is much more to come and we are working diligently with the Administration to help 'unclog the pipeline' and get capital flowing into housing again.

Alero Equities is Moving to the Flynt Building

We Got It!

Alero Equities, the Financial Professionals, is bringing Wall Street to Los Angeles. We are the Only Firm in the City that has a Trading Floor connected directly to the New York Stock exchange, the nation's financial head quarters. Look for our Grand opening e-flyer coming soon.











The luxurious Flynt Building is located at 8484 Wilshire boulevard in Beverly Hills.

Our new facilities features:

- 24 hour security on site

- Valet parking for visitors

- Underground 3/1000 + parking for Tenants

- Beautifully appointed lobby 15.5% load factor on multi-tenant floors

- Walking distance to La Cienega's Restaurant row, Starbucks, and Coffee Bean

- Walking distance from Washington Mutual, Bank of America, Wells Fargo, and CitiBank

Contact us at 866-354-5125 to schedule an appointment and visit our new flagship location!

Retire in Style

Human beings are distinguished from other species by our ability to think ahead and to plan ahead. However, most of us have great trouble thinking about the long term and preparing for it. We're too caught up in the hectic schedules of our day-to-day lives. Heck, it's difficult enough to plan something just six months ahead, like a summer vacation. How on earth are we supposed to be able to think about something in the distant future -- like retirement?

Thinking in advance, though, and acting on those thoughts, are keys to preparing for the future. The younger you are, the more distant is retirement -- and the more power you have at your fingertips in the form of compounded returns over time. That is why now is the time to start investing in your future so that you can benefit from these compounded returns in your retirement years.

Alero Mack, of Alero Equities, is a specialist in retirement planning, and can lend lend his insight to help us answer the important questions on retirement planning.

• How much will I need for my retirement in order to live comfortably?

• What are my goals?

• When should I start?

• What should I do?
  

• How much can I count on from Social Security?

• What costs might I run into once I've actually retired?

These are the questions that we all need to ask; questions that we often wait too long to ask. However, now is the best time to make these choices to ensure that you and your family are taken care in the years ahead.

Please contact us at 866-354-5125 or by email to discuss your retirement goals in person.

Take a moment to watch these instructional videos on

• "Click Here --> Watch a Video on How to Create Wealth" and

• "Click Here --> Watch a Video on How to Eliminate Debt"

Women and Retirement

Nearly twice as many women as men will face poverty in retirement, according to the incoming president of the American Association of Retired Persons.

Prospects for financial security in old age is starkly more bleak for minorities, said Jennie Chin Hanson, formerly the executive director of an elder care agency in San Francisco.

Women must learn details of their family finances and begin planning for retirement early in life, said Hansen, a former nurse.

Speaking to an audience of elder care providers at the City Club of Cleveland, Hansen cited several AARP sponsored studies and reports that suggest an emerging risk of poverty for females.

The poverty rate in retirement for African-American women is nearly three times the rate for white women.

Nearly 2/3 of white women who are poor in old age were not poor in earlier years.

Women face challenges in preparing for retirement because they often earn less than male counterparts, often must periodically leave the workforce to provide family care and often have not adequately planned for retirement, she said.

Hansen, who becomes AARP president in May, offered several tips for retirement planning.

Women should become financially literate. "People who understand compound interest are must more likely to plan for retirement, " she said.

Existing Social Security benefits frequently provide only about 40 percent of financial needs, estimates show. Today, many retired females qualify for only about $1,100 per month in Social Security, she said.

Retirees will need about 70 percent of the pre-retirement income to maintain their lifestyle, she said.

Workers should participate in company subsidized retirement savings plan, like 401 programs. Employees should contribute enough to gain the maximum contribution from their employer, she said.

AARP was organized 50 years ago as a method to provide health insurance to retirees. The nonprofit organization has nearly 40 million members and annual revenues and expenses of about $1 billion.

The group is often cited as one of the nation's most powerful political lobbies.

Life Insurance Facts

All life insurance policies have one thing in common: They provide a tax-free death benefit to your beneficiary when you die. But that’s where the similarities stop.

Here, the Maryland Association of CPAs offers an overview of the most common types of life insurance to assist you in determining which best meets your needs.
Term insurance

Term life insurance policies offer death benefits only. Term insurance is simple to understand and it allows you to purchase the most coverage for the least amount of money. You buy a policy for a specific amount and term -- 15 years, for example. If you die during that term, the policy pays the death benefit to your beneficiaries. If you outlive the term of the policy, you get nothing. However, you can renew the policy at much higher rates or convert the policy to a permanent form of life insurance.

The two key types of term insurance are level term life insurance (in which the premiums remain the same over a specified period of time) and yearly renewable, which starts out with a lower initial premium, but the premium rises each year.
Whole life insurance

Rather than insuring you for just a part or a “term” of your life, a whole life policy is designed to cover you for your entire life.

Whole life policies cost more than term policies because, in addition to providing a death benefit, a whole life policy builds up what is referred to as "cash value." This is essentially an investment component that, after a certain number of years, you can withdraw or borrow against. (Unpaid loans against the policy are subtracted from the death benefit.)

The investment return on a whole life policy is likely to be lower than what you might earn investing on your own, because insurance companies typically invest conservatively.
Universal life insurance

Flexibility is the key selling point of universal life insurance.
With this type of whole life insurance, you can increase or decrease the death benefit as your insurance needs change. You can, within limits, determine how much of your premium is used for insurance and how much goes toward the policy’s investment component. You can also increase or decrease the amount of premium payments and how often you pay them.
Variable life insurance

Variable life insurance differs from whole life insurance in that it allows you to invest the cash value of the policy in stocks, bonds or money market funds within the insurance company’s portfolios.

With a variable life policy, both the death benefit and the cash value depend on the performance of the investments you choose, but most policies guarantee that the death benefit will not fall below a specified minimum.

A variable life policy is considered a security and sold only by prospectus.
Making the decision

The type of life insurance you buy will depend on your individual needs and what you hope to get out of your policy. It’s important to consider how much protection your family needs, how long you need coverage and how much you can afford to pay in premiums.

If what you need is strictly income protection for a set amount of time, term insurance is the more appropriate and cost effective option. Term insurance works out particularly well if you follow the principle of “buy term and invest the difference.” This means you set aside and invest on your own the money you would have spent on a more costly whole life policy.

For people with more complicated or long-term needs, whole life insurance or one of its variations may make sense. For example, if you have contributed the maximum to your retirement savings and other tax-sheltered plans, you might consider whole life insurance because the cash value in the policy builds up tax-free.

As is the case with most important financial decisions, your life insurance choice should be made within the context of your overall financial plan and circumstances. A CPA can help you determine the type of policy that works best for you.

Only CPAs are equipped to address your full range of financial needs with integrity and insight. In california Financial Advisors must pass a rigorous examination, adhere to strict ethical and Professional standards. CPAs must pass a rigorous two-day examination, and adhere to strict ethical and professional standards, and, beyond college, complete 80 hours of continuing education every two years to be certified by the state — accountants do not.

Your doctor is certified; your lawyer is certified. Make sure your accountant is a certified public accountant.

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Alero Equities has the plan you can REALLY Retire in 5-7 years. Retire and stay Retired. Only 2% of Americans can Retire and Stay Retired. Live the American Dream in your later years.

Call 1-866-354-5125 for dates and times of our weekly Financial Workshops.