e-financialwriter

Adding a new REIT

2012-01-29T14:35:00.000-05:00

My goal with the e-FinancialWriter REIT Index is to show how real estate can provide attractive returns in good times and bad. I plan to accomplish that with approximately 10 REIT stocks across several sectors of the economy. There are now eight in three sectors: Self-storage, health care, and

Canada

The strategy is working ...

The Index is up 25.44% since I introduced you to my first REIT, Public Storage (PSA), on 3/14/10.

And today, I’m adding a fourth sector, retail properties.

Here’s why:

The Department of Commerce reported that December 2011 retail and food services sales were up 6.5% from one year ago.
Total sales for the full year 2011 were up 7.7% from 2010.
Total sales excluding autos for all of 2011 were up 7.3% from 2010.
Personal savings rate went down in 2011, falling to 3.7% from 5%.

Americans buying more, saving less — I see a trend here!

Plus this is an election year. That means it’s a safe bet we won’t see any tax increases; and the administration will do everything possible to cut unemployment, pump up the economy, and keep consumers spending.

With that backdrop, I like the single-tenant, free-standing retail sector.

These are the REITS that have tenants such as convenience stores, full-service restaurants, and automotive parts stores. They’re the kind of places you probably shop at several times a month … to fill up your car, have a moderately priced sit-down lunch, or buy some wiper blades for the car.

National Retail Properties (NNN) is my pick. It’s well-diversified, with 1,298 properties in 47 states. Almost half of the holdings are in the south and southeast

U.S.

The stock has returned an average of 11.4% a year over the past 3 years, for the period ending 9/30/11, including dividends. The returns and dividends have been slightly above the sector’s average.

And speaking of dividends, NNN is one of only 105 out of the more than 10,000 publicly-traded companies to have increased dividends for 22 or more consecutive years.

So starting this week keep your eye on NNN and the other REITs in my Index.

Best wishes,

George

Week end REIT index

2012-01-29T10:07:00.000-05:00

Here is the e-FinancialWriter REIT Index for the week ending January 27, 2012.

REIT	Sector	Blog date	Price	Closing price 01/27/12	Return to date %	Dividend yield %
PSA	Self storage	3/14/2010	90.75	137.52	51.54	2.66

VTR	Health care	12/30/2010	52.87	58.82	11.25	3.91
HCP	Health care		36.81	41.92	13.88	4.58
HCN	Health care		47.53	57.25	20.25	4.95
SNH	Health care		22.00	22.36	0	6.71

IAECREIN:CN	Canada	9/27/2011	19.45cn	22.89cn	17.71	0
ZRE:CN	Canada		16.29cn	18.99cn	16.57	5.31
INVRLPRA:CN	Canada		5.45cn	5.46 cn	0	1.97

Index return					25.44

Source: Bloomberg

Some insider buying is going on with one of the Index’s REITs. Richard Gilchrist, a director at Ventas (VTR), indicated that he purchased 2,500 shares for $140,000, increasing his holdings to 10,987 shares (and options to purchase 7,520 shares).

When insiders buy, it often means they see something good going on that the rest of us don’t.

To read the posting where I introduced a specific REIT, click the “Blog date” link. And if you’d like to see past week’s reports, just type “reit index” in the search box.

Have a good weekend!

George

Need a break from all the campaign mumbo-jumbo?

2012-01-26T17:35:00.003-05:00

It’s primary time. Here in Florida ours is less than a week away. And the pressure is on.

Two flyers were in my mailbox today … both saying that Newt spells trouble.

No sooner had I trashed those, and the phone rang. “Don’t believe that Romney is a moderate Republican,” the recorded message began.

Then I was searching for something online, and what flashed before my eyes: Think You Know Mitt? Think Again.

And of course there was Obama’s State of the Union/political/finger-pointing speech Tuesday night.

I can only imagine what the rest of the year holds.

So in the midst of all the barking from both sides, it was refreshing to have someone send me this news clip. It’s short. And you’ll come away knowing that America is in good hands.

Best wishes,

George

Week end REIT index

2012-01-22T10:07:00.000-05:00

Here is the e-FinancialWriter REIT Index for the week ending January 20, 2012.

REIT	Sector	Blog date	Price	Closing price 01/20/12	Return to date %	Dividend yield %
PSA	Self storage	3/14/2010	90.75	135.83	49.67	2.69

VTR	Health care	12/30/2010	52.87	56.42	6.71	4.08
HCP	Health care		36.81	40.85	10.98	4.70
HCN	Health care		47.53	55.10	15.93	5.15
SNH	Health care		22.00	21.95	0	6.83

IAECREIN:CN	Canada	9/27/2011	19.45cn	23.12cn	18.88	0
ZRE:CN	Canada		16.29cn	19.25cn	18.17	5.23
INVRLPRA:CN	Canada		5.45cn	5.46 cn	0	1.97

Index return					22.97

Source: Bloomberg

To read the posting where I introduced a specific REIT, click the “Blog date” link. And if you’d like to see past week’s reports, just type “reit index” in the search box.

Have a good weekend!

George

A sad day in America

2012-01-17T17:33:00.000-05:00

I follow financial stuff like taxes, stocks, and real estate. Some of it’s kind of boring. But I do pay attention when ever a company that has been around a long time has financial problems.

And I’m sad to report that the maker of Twinkies, Hostess Brands, has filed for bankruptcy.

This American icon, which Peter from Family Guy proclaimed as the ONLY food that can survive a nuclear holocaust and Bill Clinton placed in a time capsule, is falling victim to Yuppies with their fruit smoothies and power bars.

My advice: Ignore the government watchdogs who want to control every aspect of your life. And tune out the chants coming from the low-fat yogurt crowd.

Go out right now and pick up a box of Twinkies … what the heck, get two. This might be your last chance!

Then kick back and enjoy one of those snacks with the mysterious cream filling that epitomizes 150 empty calories with 4.5 grams of fat that was good enough Buffalo Bob Smith and became an American legend.

Best wishes,

George

Week end REIT index

2012-01-14T12:11:00.001-05:00

Here is the e-FinancialWriter REIT Index for the week ending January 13, 2012.

REIT	Sector	Blog date	Price	Closing price 01/13/12	Return to date %	Dividend yield %
PSA	Self storage	3/14/2010	90.75	134.94	48.69	2.7

VTR	Health care	12/30/2010	52.87	54.95	3.93	4.18
HCP	Health care		36.81	41.11	11.68	4.67
HCN	Health care		47.53	55.53	16.83	5.1
SNH	Health care		22.00	21.92	0	6.85

IAECREIN:CN	Canada	9/27/2011	19.45cn	22.86cn	17.55	0
ZRE:CN	Canada		16.29cn	18.99cn	16.57	5.3
INVRLPRA:CN	Canada		5.45cn	5.45 cn	0	1.98

Index return					22.21

Source: Bloomberg

If you’d like to see past weeks' reports, just type “reit index” in the search box.

Have a good weekend!

George

Check your 2010 tax return

2012-01-13T09:31:00.000-05:00

Did you convert some or all of your traditional IRA to a Roth IRA in 2010? Generally the amount converted would be taxable in the year converted. But in 2010, you were given the opportunity to spread the additional income over 2011 and 2012.

Not sure if you did a conversion or what your tax preparer did? Then I suggest you dig out your 2010 tax return and take a look.

You might have to include part of that conversion as income in your 2011 return.

For more information on IRA conversions, see IRS Publication 590.

Best wishes,

George

Important tax changes for 2012

2012-01-10T17:52:00.000-05:00

Here are some tax changes that could put some dollars back in your pocket this year.

	2011	2012
Standard deduction, single filer	$5,800	$5,950
Standard deduction, joint return	$11,600	$11,900
Personal exemption	$3,700	$3,800
ATM exemption
Single filer	$48,450	$33,750
Joint return	$74,450	$45,000
Long-term care insurance (max. deduction)
Age at end of tax year:
40 or under	$340	$350
41-50	$640	$660
51-60	$1,270	$1,310
61-70	$3,390	$3,500
Over 70	$4,240	$4,370
Roth IRA contribution
Single filer	$107,000	$110,000
Joint return	$169,000	$173,000
401(k) and 403(b) plans
Max. contribution	$16,500	$17,000
Catch-up contribution	$5,500	$5,500
Wages subject to Social Security tax	$106,800	$110,100

And there are a few more that the IRS sent out last week. You might want to take a look at them to see if you qualify.

Best wishes,

George

Week end REIT index

2012-01-07T09:54:00.000-05:00

Here is the e-FinancialWriter REIT Index for the week ending January 6, 2012. As you can see, my index has beaten the S&P 500 (as represented by the ETF SPY) over the past 12 months by more than 6:1. Plus it’s paying a dividend yield of close to 4%, almost twice SPY’s.

REIT	Blog date	Price	Closing price 01/06/12	Return to date %	Dividend yield %	1-yr return %
PSA	3/14/2010	90.75	132.28	45.76	2.76	34.11

VTR	12/30/2010	52.87	53.70	1.57	4.28	7.07
HCP		36.81	40.34	9.59	4.76	16.51
HCN		47.53	54.23	14.10	5.23	21.21
SNH		22.00	22.52	2.36	6.62	8.73

IAECREIN:CN	9/27/2011	19.45cn	22.64cn	16.38	0	16.04
ZRE:CN		16.29cn	18.61cn	14.24	5.41	14.27
INVRLPRA:CN		5.45cn	5.45 cn	0	1.98	6.62

Index				13	3.88	15.57

SPY					2.02	2.41
Source: Bloomberg

This proves that even in a lousy financial environment, owning some real estate can help boost your portfolio’s return.

Have a good weekend!

George

You get two extra days!

2012-01-05T18:01:00.000-05:00

Last April, I wrote about Emancipation Day and how it can give you some extra time to file your 1040.

This year Emancipation Day falls on Monday. So you have until April 17 to send in your tax return. But if you file a 6-month extension, it’s only good until October 15.

In case you missed that posting from April 12, 2011, you can find it here.

Best wishes,

George

A deal on health care could be a click away

2012-01-02T10:16:00.000-05:00

Getting affordable medical care can be a big challenge if you’re without insurance. Your choices include:

Going to a “doc in the box”
Going to an emergency room
Doing without

Here is an idea I came across the other day that could save you a heap of money if you find yourself in such a bind …

It seems that companies such as Groupon and LivingSocial that offer daily deals from local businesses on things like pastries and landscaping are getting into the health care deal business. All you do is register and check your e-mail for deals of the day.

You can read the complete article here.

You never know, you just might come across a doc in your area who is offering a great deal on a physical, an eye exam, or something else you’ve been putting off for a long time.

Best wishes,

George

Week end REIT index

2011-12-31T18:12:00.000-05:00

Here is the e-FinancialWriter REIT Index for the week ending December 30, 2011.

REIT	Blog date	Price	Closing price 12/30/11	Return to date %	Dividend yield %	1-yr return %
PSA	3/14/2010	90.75	134.46	48.17	2.71	36.75

VTR	12/30/2010	52.87	55.13	4.27	4.17	9.77
HCP		36.81	41.43	12.55	4.63	18.65
HCN		47.53	54.53	14.73	5.20	21.27
SNH		22.00	22.44	2	6.64	9.28

IAECREIN:CN	9/27/2011	19.45cn	22.33cn	14.79	0	15.15
ZRE:CN		16.29cn	18.46cn	13.32	4.17	9.77
INVRLPRA:CN		5.45cn	5.45 cn	0	1.88	6.52

Index return				13.73	3.68	17.56

SPY					2.05	1.89
Source: Bloomberg

Have a safe and happy New Year!

George

Important tax changes for 2012

2011-12-29T18:29:00.000-05:00

Yesterday, I gave you some last minute steps you can take to cut your 2011 taxes. So today, I’d like to tell you about a few changes that might help you in 2012.

The standard deduction, personal exemption and certain other figures the IRS adjusts for inflation will take their biggest jump in three years.

Your tax rate might drop, too ...

You won’t fall into the 35% bracket until you have a taxable income of $388,350 in 2012 on both single and joint returns, versus $379,150 this year.

And if your ordinary tax bracket is 15% or lower, you won’t have to worry about paying tax on qualified dividends and long-term capital gains. That means in 2012, you and your spouse can have a taxable income as high as $70,700, or if you’re single up to $35,350, before dividends and long-term gains are taxed. That’s not much different that 2011 when the limits were $69,000 and $34,500, respectively.

But it’s not all peaches and cream for 2012 ...

You’ll stand a greater chance of getting caught up in the dreaded alternative minimum tax. The exemption is scheduled to take a big drop next year when a provision of the 2010 Tax Relief Act expires.

You can see some of the changes in the chart below.

	2011	2012
Standard deduction, single filer	$5,800	$5,950
Standard deduction, joint return	$11,600	$11,900
Personal exemption	$3,700	$3,800
ATM exemption
Single filer	$48,450	$33,750
Joint return	$74,450	$45,000
Long-term care insurance (max. deduction)
Age at end of tax year:
40 or under	$340	$350
41-50	$640	$660
51-60	$1,270	$1,310
61-70	$3,390	$3,500
Over 70	$4,240	$4,370
Roth IRA max. contribution
Single filer	$107,000	$110,000
Joint return	$169,000	$173,000
401(k) and 403(b) plans
Max. contribution	$16,500	$17,000
Catch-up contribution	$5,500	$5,500
Wages subject to Social Security tax	$106,800	$110,100

Best wishes,

George

Last minute tax-savings steps

2011-12-28T16:25:00.000-05:00

Before you pop the bubbly to welcome in the New Year, Geithner and his gang of bandits have a few tips for you to consider doing over the next two days:

Make Charitable Contributions – If you itemize deductions, your donations must be made to qualified charities no later than Dec. 31 to be deductible for 2011.

Install Energy-Efficient Home Improvements – You still have time this year to make energy-saving and green-energy home improvements and qualify for either of two home energy credits.

Consider a Portfolio Adjustment – Check your investments for gains and losses and consider sales by Dec. 31. You may normally deduct capital losses up to the amount of capital gains, plus $3,000 from other income. If your net capital losses are more than $3,000, the excess can be carried forward and deducted in future years.

Contribute the Maximum to Retirement Accounts – Elective deferrals you make to employer-sponsored 401(k) plans or similar workplace retirement programs for 2011 must be made by Dec. 31. However, you have until April 17, 2012, to set up a new IRA or add money to an existing IRA and still have it count for 2011.

Make a Qualified Charitable Distribution – If you are age 70½ or over, the qualified charitable distribution (QCD) allows you to make a distribution paid directly from your individual retirement account to a qualified charity, and exclude the amount from gross income.

Don't Overlook the Small Business Health Care Tax Credit – If you are a small employer who pays at least half of your employee health insurance premiums, you may qualify for a tax credit of up to 35 percent of the premiums paid.

You can find the full detailed list with links to important publications here.

Best wishes,

George