Tips for Surviving a Stock Market Crash

Tips for Surviving a Stock Market Crash

Investing in the stock market can be a great way to build long-term wealth. When you are looking to invest in the market, you will find that bull markets can provide a lot of growth and strong investment returns. However, there are also bear markets and random stock market crashes that can be harder to deal with. Fortunately, there are several tips that can be followed that can make it easier for you to deal with a stock market crash.

Don’t Get Emotional:

When a stock market crash is taking place, the most important tip to follow is to avoid getting emotional. When the stock market takes a deep dive down, it is very easy for people to panic and want to sell all of their stock. While they may be able to avoid some further temporary losses, they most likely will end up missing out on the rebound as well. This can make it impossible to ever catch back up and investors will end up losing out on a lot of potential.

Buy Low:

During a stock market crash, it could also be a great time to buy some speculative stocks at low prices. During a crash, many of the most struggling stocks will end up being those that are speculative in nature. While these stocks can increase dramatically during a strong economic cycle, they can do even worse when things are bad. This can provide you with a great opportunity to acquire a growth stock at a fraction of the price.

Focus on Quality:

During a bear market, you should also focus on the quality of stocks that you are buying. During periods of prosperity, it is important to focus on stocks that provide a lot of potential. However, during bear markets you should also look at companies that are stable and strong. It could be beneficial to invest more of your capital in companies that have a strong balance sheet and are able to withstand the bear market. You should also look for stocks that continue to pay dividends during the recession.

Consider Opportunities:

Another advantage of investing during a bear market is that you will receive more opportunities than you would during other cycles. When the whole market is going down, it provides plenty of opportunities to invest in companies that could actually prosper during a recession. Discount retailers and other similar companies can do very well when the market is low, which can provide you with a great opportunity.

Monitor Regularly:

When you are dealing with a stock market crash, it is also important that you monitor your portfolio on a regular basis. Many people tend to ignore the market when times are bad. While this can help to reduce stress in the interim, it can lead to larger problems in the long-term. A better option would be to continue to monitor the market and their portfolio to ensure they are positioned as well as possible for the future and are properly protected from other risks.

Edward Schinik has been with the Investment Manager since 2009.

3 Great 401(k) Features Everyone Should Know About

3 Great 401(k) Features Everyone Should Know About

It was just a few decades ago that most employees had a nice pension and a gold watch waiting for them when they turned 65. That’s no longer the case. Today, more employers offer a 401(k) plan or a similar defined contribution plan for their employees. Many people decry this shift, but there are some great features that come with 401(k) plans. Here are three that you should take into consideration before deciding not to participate.

401(k) Plans Allow You To Save On Taxes:

For every dollar you put into a 401(k) plan, you’ll save your marginal tax rate on that dollar. If your marginal tax rate puts you into the 12 percent tax bracket, you’ll actually only see 88 cents for every dollar you save taken out of your paycheck each pay period as long as you save on a pre-tax basis. If your tax rate is higher, the tax benefits get even better and could hit as much as 37 percent in 2018. Additionally, you don’t have to pay any taxes on the gains that you experience within your 401(k) until you decide to take the money out when it comes time to retire.

You Can Save Big Money:

Not only can you save money that would otherwise go to Uncle Sam, there are other benefits that come with saving in a 401(k) plan. Starting with the 2018 tax year, you can save up to $18,500. This number goes up periodically, depending upon the rate of inflation. This is money that you can shelter from taxes as noted above, and it can add up to a massive amount of money over the course of a working career. Additionally, if you are 50 years of age or older, you can save $6,000 more each year. This catch-up contribution would bring your total possible contribution to $24,500 for the year, and this amount will start to add up quickly.

Your Employer Might Add Funds:

One of the best aspects of saving in a 401(k) comes around for those who are lucky enough to have employers who throw in matching funds. This means that for every dollar that you put in up to a certain percentage of your pay, your employer puts in a specified amount. A common matching level is a 50 percent match for the first 6 percent of an employee’s pay. This means that you’d save $3,000 on an average $50,000 salary. Then your employer would kick in an additional $1,500. At this level, you’d effectively be saving 9 percent of your annual salary, which is getting pretty close to the 10 to 15 percent that financial planners recommend. Your employer match is free money, so you might as well take advantage of the opportunity.

Saving for the future is a must if you’re looking to have a relatively secure retirement. The decline in pension plans does not have to be a negative. If you take advantage of tax-deferred retirement plans like 401(k) plans along with an employer match, your money can really start to compound to an impressive sum over time.

Edward Schinik is the Chief Financial Officer and Chief Operating Officer of Yorkville Advisors.

3 Ways to Invest In Real Estate without Buying Property

3 Ways to Invest In Real Estate without Buying Property

Finding unique ways to invest your money is very important. While most people invest a portion of their assets in the public stock markets, it would also be a good idea to find other ways to invest to diversify your total investment portfolio. One type of investment that can provide you with great long-term returns on your investment is real estate. Unfortunately, owning investment real estate can be time consuming, stressful, and capital intensive. For those that would like to invest in real estate but are wary of actually owning real estate assets, there are three great ways to invest in the industry without ever having to worry about owning or managing a property.

Publicly Traded Real Estate Companies:

One of the best ways that you can invest in the real estate market is to invest in publicly traded real estate companies. There are dozens of real estate companies including REITs, real estate developers, and property management and brokerage firms that are publicly traded. These companies can provide you with a great long-term investment return, regular dividends, and other investor benefits. Furthermore, you will never have to worry about owning properties directly. Instead, you can enjoy the investment returns and leave all of the hard work to the professionals that lead these publicly traded companies.

Real Estate Mutual Fund:

Another way that you can invest in the real estate market is by investing in a real estate mutual fund. Today there are several actively managed real estate mutual funds that will provide you with an even more conservative and diversified investment option. These funds will invest in a wide variety of different companies in the industry including those that own, develop, and manage real estate investment properties. The funds tend to increase in value over time along with improvements in the overall real estate market. You can also expect to receive regular dividends to provide you with instant cash flow and investment returns.

Micro Investing and Lending:

For those that are looking to invest in more specific real estate projects, there are also a variety of micro investing and lending platforms available today. With a micro-investing website, you will be able to invest a specific amount of money towards the purchase, renovation, and management of a property. While you will own a small share of the property and project, it will be very limited and you will have no management responsibilities or controls. With these investments you will earn a preferred return on investment. If you are interested in providing debt, there are also micro lending websites that are geared to providing loans to real estate investors.

Edward Schinik has been with the Investment Manager since 2009.

5 Steps to Investing Your Health Savings Account

 5 Steps to Investing Your Health Savings Account

Health saving is one of the types of bank savings, but they are different when compared with the standard savings which will serve as the emergency fund, or vacation fund, the money that will be saved for health will only be used to take care of health care expenses. There are so many healthcare plans to choose from you have to select the right one. Some will be excellent because they will have the low deductible health care plan with a coverage that is amazing but others will not be that fortunate. The money set aside for the healthcare can be used to cater for annual physical visits, dental work, office visits and any other cost. Continue reading to understand the five steps of investing in your health saving account.

Determine Eligibility:

The health saving account will not be a good thing for everyone. To qualify for the account, you must have the high deductible health insurance plan. As from 2013, for someone to be eligible for the health saving account, the minimum annual deductible has been $1250, and if you have families, it’s $2500. The state that you live in must have accepted the health saving account, but if the other health insurance already covers you, the policy has to be the one that has the high deductible plan.

Review your Finances:

To fully benefit from health saving, the cash saving has to be deposited in the account. The limits that the IRS will have will be on how much you can contribute annually to the account $6250 for families and $3100 for individuals.

Open the saving account through your employer:

If in the company that you work in the employer will cover the health insurance expense, the only option that you can have is the high deductible plan. Since the only thing the cover will take care of is the major medical expense. But some employers will go out of their way to pay for the deductible plan with health saving account, that way as the employee you will have the chance of opening the account when they enroll the health plan.

Get the health saving account on your own:

Every bank will offer the health saving account or the credit union. If the employer has not provided the saving account, then check with your bank. The bank will provide you with the debit card that will be attached to the saving account, making the whole process easy to pay the amount in the saving account. If you don’t have the time to visit the bank you can set up the account online.

Check Competitor Fee:

If the bank that holds your checking and the one that you have been saving with has high fees, you don’t have to open the health saving account with them. There will be fees that will be accompanied with health saving accounts like the annual fees and maintenance fees. If you are not careful, the fees will cost you a lot. Check several banks comparing the fees before going ahead and opening the account.

Edward Schinik is the Chief Operating Officer with the Investment Manager.

Top Tax-Advantaged Investing Alternatives Beyond Company 401(k) Plans

Top Tax-Advantaged Investing Alternatives Beyond Company 401(k) Plans

Saving for retirement and other long-term financial goals is very important. For those that are looking to prepare and save for the future, taking advantage of tax-advantaged savings accounts and investment strategies can be a great option. While most people are aware of the advantages that come with investing through a 401k, there are other savings and investment accounts that can provide tax advantages as well.

Life Insurance:

One conservative investment that you can make is to invest in whole life insurance policies. Whole life insurance will provide you with life insurance protection and can also be a very conservative type of investment. When you purchase a whole life policy a portion of your premiums will go into an account that can be liquidated. This account will appreciate in value over time. While payments are made post-tax and the income earned will be taxed when it is withdrawn, the tax rate will likely be much lower since you will be in retirement.

Roth IRA:

Similar to a 401k, an IRA account will provide you with great tax advantages. With a Roth IRA, the contributions that you make into the account will be made on a post-tax basis. When it comes to retire, you will not be charged any tax on your withdrawals. This will allow your account to grow tax free and will provide a great long-term benefit. One downside is that the maximum amount you can put into the account each year is limited to $5,500 if you are under 50 years old and $6,500 if you are over 50.

Manage Your Own Index Fund:

Another way that you can manage your tax liability on your investments is to manage your own index fund. Index funds are very popular investment options because they diversify investments across the board and have low costs. One downside is that all of your capital will be in one investment, which could put a lot of tax liability on your shoulders when you finally sell. A better option would be to purchase industry and sector specific funds. These funds can cost a little bit more but will allow you to sell certain investments and hold others depending on what makes sense from a tax perspective.

Tax Free Investments:

Finally, another good investment option to minimize your tax liability is to invest in tax-free investments. These investments, which incur a variety of municipal and other bonds, can provide you with a steady and low-risk return on investment. Furthermore, your investment income will not be taxed. However, there is a limited return on investment potential that can make them a less than attractive option for someone that is looking for any kind of growth.

Edward Schinik has been with the Investment Manager since 2009.

The Best Investing Podcasts to Listen to

The Best Investing Podcasts to Listen to

Podcasts offer a wealth of information that allows you to learn as you commute, work out, run errands, and do chores. If you want to learn more about investing, check out our six picks for the best investing podcasts.

Planet Money:

It’s important for investors to have a sense of how the economy works to make smart choices, and this National Public Radio podcast on business and finance fits the bill with a back catalog of more than 800 episodes to explore. Founded in 2008 by Adam Davidson of the New Yorker and Adam Blumberg of Gimlet Media and hosted by a rotating group of NPR journalists, Planet Money comes out twice a week and will give you an in-depth education about how money works in the U.S. and beyond.

Radical Personal Finance:

Hosted by former financial planner and investing expert Joshua Sheats, this podcast covers investing and personal finance advice appropriate for anyone who wants to improve his or her overall financial picture. You’ll find deep dives about a host of investing issues, with some episodes on complex topics approaching the two-hour mark. Sheats says that the show is designed as a comprehensive curriculum and master class on personal finance.

Motley Fool Money:

Motley Fool has been a source for understandable, actionable financial advice since 1993 and its casts of expert hosts this weekly look at the top business and investing stories of the past few days, including stock picks, analysis, and interviews with industry experts.

Invest Like the Best:

If you are an advanced investor and want to learn more about unusual investments such as cryptocurrency, get the scoop from this podcast by Patrick O’Shaughnessy, principal and portfolio manager at O’Shaughnessy Asset Management, a quantitative money management firm. This podcast has produced more than 60 episodes so far, each of which ranges between 50 and 80 minutes.

Bigger Pockets Podcast:

If you’re specifically interested in real estate investing, the Bigger Pockets podcast covers everything from long-term rental properties to short-term flipping, exploring the nuances of making money from real estate. They offer tips and resources and provide interviews with real estate investors who give listeners real-world advice on profiting from properties.

Money Mastermind Show:

This podcast has five co-hosts that offer broad coverage of personal finance and investing topics designed to help listeners master their own economic pictures. The personal finance bloggers behind this show chat with a weekly guest about a relevant topic, providing detail coverage of many aspects of investing.

Edward Schinik is the Chief Financial Officer and Chief Operating Officer of Yorkville Advisors.

Why Investors Should Consider Investing In Tech Stocks

Why Investors Should Consider Investing In Tech Stocks

Investors have been pleased with the gains in the technological industry over the last year. Huge tech stocks such as Facebook, Amazon, and Netflix have made a substantial impact on the market. Even smaller stocks such as NVIDIA, Shopify, and Arista have seen large increases after every period. While research continues to show that investing in the technology sector could potentially bring lucrative rewards, many investors are still hesitant to invest in tech stocks due to a lack of understanding concerning the technology. If investors are not aware of what the tech companies can do, it is difficult for them to see the long term growth of their potential investment. Here are a couple of variables that investors should look at to see if a tech company is on the rise.

Good Margins:

Many investors feel that tech companies should be doing more than just promoting their products and services. Investors should pay attention to a company’s operating margins. By looking at a company’s operating income and dividing it by their total revenue, investors can get a realistic idea of a company’s profitability. If a company has shown that they can increase their operating margin, that is a symbol that the company still has appeal. Appealing companies are able to uphold their competitive advantage over their peers.

Increased Revenue Streams:

Investors are looking for tech companies that have shown the ability to maximize their revenue growth. When companies start working on a project that has the potential to be special, investors are quick to jump on the opportunity. Companies that are able to grow their revenue at a high rate send a signal to investors that their products and services are popular.

Why Do Investors Avoid Tech Companies?

Many investors have noted that they avoid tech companies because of the difficulty in measuring the competitive advantage in the industry. Investors have also noted how difficult it is to identify which companies have great potential because most companies still have room to develop. It’s hard to predict where the next major discovery will come from. Many investors fear partnering with a company only to see them passed by an unlikely competitor that happened to create the next great technological advancement. Regardless of the risks, the potential rewards of investing in the technological industry are too lucrative for many investors to turn down. The World has embraced the arrival of the mobile and digital age.

Edward Schinik has been with the Investment Manager since 2009.

How to Fund Your College Education by Investing

How to Fund Your College Education by Investing

Modern education costs have climbed significantly in recent decades. The cost of a four year college education now rivals buying a house, and larger numbers of students are exiting college deeply in debt.

Fortunately, there are some steps you can take to help manage the costs associated with higher education. With some careful planning and consistency in the execution of that plan, a four year degree can be within reach even for those of limited monetary means.

It Starts With Planning:

The first step in affording a college education is proper planning. The type of school you attend, where you will live and whether you plan to work through school are all key considerations. Once you have done some planning, it will be far easier to try to determine how much you will need to afford a college education.

Start Investing:

The sooner you start investing for college, the better. The power of compound interest in truly amazing, and can help grow your money rapidly. It is not only important to get the ball rolling on investments, but to then make sure to invest regularly. This can be accomplished easily today through automatic bank account withdrawals or even automatic paycheck deductions. Making saving completely automated will not only help you maintain discipline when it comes to saving, but may also help your funds grow faster.

Choose Investment Products:

In the world of investing, there are numerous ways to put your capital to work. Determining where to put your capital to work will be an important decision that could have a dramatic impact on returns. The longer period of time you have to save, the more risk you may be willing to take. In this case, stocks may potentially be a worthy investment. You may want to focus on stable, dividend-paying blue chips as the cornerstone of your portfolio.

If you have a short time frame of two years or less, you may want to consider investments that display less volatility. Savings accounts, CDs and money market funds may be worth consideration. An established mutual fund or diversified ETF may also potentially be a good choice.

Avoid Withdrawals Until Necessary:

The longer your money is able to work for you, the higher the potential return on investment. Do not begin taking money out until absolutely necessary, and only take out what you need to cover key expenses such as tuition, housing, food and other necessities.

A part-time job may also be a great way to stretch your college savings. Any income from a job can be used to pay expenses, which may allow you to keep your investment capital working harder and longer.

Although the cost of higher education has become a major issue for many, some careful planning combined with good investing sense and discipline can pave the way for you to attend college and focus on what’s really important: Your studies.

Edward Schinik is the CEO of Yorkville Advisors.

The 50/20/30 Rule of Investing

The 50/20/30 Rule of Investing

For people who are just starting out with their first job, or even those who have been on their own for decades, having a plan for your money can be hard. Most of us simply fly by the seat of our pants, checking our accounts to see if we have enough money to pay the bills that week, and then trying to hold on until payday.

A sound money strategy can go a long way, not just in paying off debts and planning for retirement, but in the simple peace of mind. If you’re confused on where to start, the simple 50/20/30 plan is a great rule of thumb to get going.

1. 50% Goes Towards Essentials:

An essential is anything you must have in order to survive and most likely cannot get out of paying, no matter how hard you try. For instance, you have to have a roof over your head, you have to eat, and you have to have transportation (even if you don’t own a car), so all of that falls into this category. Though this 50% metric may seem a little high, once you tally up all the things that fall into this category, you’ll see that it hits right about even.

What is essential to you can change from person to person also. Someone who lives in a place that is expensive (like NYC), may be able to walk to work, while those living out in the suburbs may have lower housing but higher transportation costs. Don’t forget to include utilities when factoring in the basic housing costs as well.

2. 20% Goes Toward Savings:

No matter how old you are, you need to be planning for your retirement NOW. The best asset you’ll have at your disposal is time, so make the most of your compounding interest and any employee compensation package you may have by contributing to this bucket regularly.

This category also applies to debt payments such as student loans or credit cards – anything you pay in advance in order to get ahead. Everything in your “savings” budget line comes after your necessary expenses have already been paid and will contribute to a stress-free future, like a rainy day fund, for example.

3. 30% Goes Toward Personal:

This is not fun money; “personal” expenses are anything that is somewhat unnecessary that enhances your lifestyle. This is, by far, the most fluid category of the three, and most financial experts have a hard time deciding what is “necessary” and what isn’t, so use your best judgment. While a cell phone may not be necessarily considered a “luxury,” the type of phone and plan you buy may be, so budget accordingly.

Other things that may fall into this category are leisure or personal pursuits, like a gym membership, Netflix account, or travel fund. Out of your entire take-home pay, only 30% should be appropriated towards these types of expenses, but remember: the fewer costs you have in this category, the faster you can contribute to the other categories that will make your life easier.


Edward Schinik has been with the Investment Manager since 2009 and has been with one Affiliated Investment Manager since 2005.

Best Practices for Beginner Investors

Best Practices for Beginner Investors

As the world of finance becomes increasingly digital, a new generation of investors is being created. Thanks to technologies, such as online brokerage platforms and third-party resources that monitor asset prices, today’s investor is more independent. However, that does not mean investing does not bear risk anymore. On the contrary, one could argue that it can actually be even riskier, given the new market players and factors that move prices. Here’s five best practices to help the novice investor.

Manage Your Risk:

If you’re going to take anything out of this article, let it be this tip. Successful investing is all about risk management. A common mistake that beginners and even experienced investors make from time to time is chasing after profits first and only controlling losses second. Whenever you buy an asset, make sure you have a predefined stop loss or price level wherein your broker automatically closes and liquidates the position.

Master One Asset First:

Each asset has varying factors that move its prices. A company’s stock may be susceptible to its quarterly earnings reports but not to the statements released by central bankers. On the other hand, worsening geopolitical turmoil may move currency pairs but not affect stock exchanges. And while people say you should diversify your investments, you should first learn and master one asset before moving onto the next.

Look at the Big Picture:

A common misconception is that investing is a fast-paced, get-rich-quick scheme that can transform your life overnight. When people hear about investing, they think of investment bankers earning a fat bonus check from making their company millions of dollars or a self-taught trader working from home with four to six screens all brightly blinking from changing asset prices. However, in the long run, it all boils down to finding value. Even a one percent gain on your investments is a modest return.

Don’t Just Blindly Follow the Herd:

While there is safety in numbers, it can be financially detrimental to just take a neighbor’s financial advice or a coworker’s stock recommendations without putting in the time and effort yourself to research these assets. Online publications and live interviews on business channels can easily sound compelling to heed and follow, but bear in mind that these so-called experts and pundits are no better at predicting future asset prices than someone who just started reading charts today. Do your own market research, verify that statements made by key figures are indeed legitimate, and use historical patterns as a guideline for making future investment picks.

Don’t Look at Your Account Every Hour:

Perhaps one of the simplest yet most impactful habits of succeeding in investing is to not look at your portfolio by the hour. It only causes unnecessary confusion, stress, and the temptation to make hasty and illogical investment decisions.

Final Thoughts:

Investing doesn’t require you to be the smartest or wealthiest. It’s all about following through with your plan, practicing the right daily habits, being patient, and continuously learning the financial markets.


Edward Schinik is the CEO of Yorkville Advisors.