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Millionaires and Billionaires [+Infographic]

Would you like to build up a million-dollar nest egg by the time you retire? For middle-class earners, that goal is challenging but possible if you start at age 25 and save $1750 a month. Many married couples could do this by maxing out their 401(k) contributions. Or you could take the route that many people follow and build a small business into a million-dollar asset.

What if you want to accumulate a billion-dollar nest egg instead? Starting at the same age of 25, you would need to save $21 million a year. Good luck with getting any employer match on that.

There’s a vast difference between a million and a billion.

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Business Profits Essential; “Fair” or “Unfair” Profits a Value Judgment

I recently had a conversation with a teenager who was annoyed at Disney’s ongoing promotion of the movie “Frozen.” The young woman’s point was that Disney is a creative company and, by pouring so much time and resources into promoting “Frozen,” it was robbing its loyal customers of new material.

My response, that perhaps the reason Disney is promoting the heck out of this movie is because a lot of consumers must want more and are willing to pay more, wasn’t well received. “Disney has all the money it needs. They don’t need to continue promoting old material.” I suggested that Disney won’t always have all the money it needs if it doesn’t profit from its popular hits. That didn’t go over well either.

The concept of profit seems to be increasingly maligned and misunderstood.

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Diversify with Global Investing

Around twelve years ago the South Dakota Investment Council combined two of their asset classes, domestic and international stocks, into one, global stocks. While this move didn’t make the nightly news, it did signify a growing trend. Many investment managers no longer view the US stock market as a separate asset class from the rest of the world’s stock markets. Today they view it as one component of a global asset class of stocks.

For the same reason you don’t want to own just one company’s stock in your portfolio, it makes no sense for an individual investing for retirement to own just US stocks. It’s as important to diversify among countries as among companies.

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Surprising Leadership Qualities Financial Planning Clients Look For

Do you expect a financial planner to be a strong leader? Most clients—89%, in fact—do. This finding, from a survey conducted last fall by Advisor Impact for the Financial Planning Association, is hardly surprising.

What is surprising, however, is the way survey participants described leadership. They said a strong leader should have these four qualities: expertise, skill as a guide, deep understanding, and vulnerability.

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Protect Yourself When Hiring Contractors

This time of year, half the homeowners in town are trying to hire landscapers. All of us check our phones even in the middle of meetings or medical appointments, because we desperately hope it might be the yard guy calling back.

As my wife and I work on our yard, however, I’m proceeding with caution. Several years ago I hired a landscaper and paid him $2000 up front as a down payment on the work. We never saw a single bush, tree, or shrub. We never saw him or the money again, either.

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