Fee Based Financial Planner

The foreign exchange markets are all about Forex trading systems. If you are interesting in expanding your investments and learning more about how you can make money in the foreign markets, Forex is what you should be looking to understand and learn more about. Just as there are all types of investment strategies in your own country, in products and companies that are sold near where you live and work, you can also get involved in the companies and products that are sold abroad. Foreign exchange markets are some of the hottest markets that you can find to make money in your investment portfolio.

The exchange rate from country to country can be just one step in where you are going to make money. For the dollar, changed to another currency can equal more opportunities to purchase additional stocks. The companies you are going to be investing in will be based in that other currency so you will need to exchange your money into that other currency before investing.

You can invest in Forex trades on your own or through a broker firm. If you are going to invest your money on your own, it is suggested that you learn about the company, about the other methods of trade, and you learn more about the currencies where you are going to invest your money. There are over one trillion dollars in trades made per day in the Forex markets. If you are careful and study where you are going to put your money, you can earn more by making the right choices. It takes at least two months worth of trading on the US market to equal the trades that are going on in the Forex markets. Foreign companies are open to investors, and will give great returns to those who do their homework.

You will need to learn and study the charts of the companies you are going to consider investing with. Charting and following the growth and the downfalls of companies can be seen if you take your time before jumping in and investing. This is one thing that a Forex trading system is going to open you to. Forex trading systems are methods that are already proven for watching and detailing companies as they change and grow. Without some type of Forex trading system to follow you could be shooting in the dark to find that company that is just right for your needs while investing.

Forex trading systems are becoming so very popular because there are so many additional methods that can be used to get into the markets that are not available through the New York Stock exchange. If you want to reach a Forex trader you could be reaching on that works from their home, or in an office that is around the world. Following a particular Forex trading system is something you will become more comfortable with as you learn more about the individual markets, the companies, and about the value of foreign currencies. Open your mind to make money using the methods you can learn, and complete on your own time.

Retirement Bonds

Traditional surety bond underwriting does not allow for any losses. In other words, applicants are only suppose to be approved for a bond if the underwriter believes there will be no claims. This differs from insurance underwriting, as a loss is expected and is built into the premium. Higher risk applicants are usually declined or asked to post 100% collateral with the bond. The surety bond market is starting to see some change in how bonds are underwritten. However, these forward thinking sureties are in the minority and are difficult for the average principal to find.

As stated above, according to traditional surety underwriting bonds are suppose to be written as a service fee, not insurance. Therefore, there are not suppose to be any claims expected, as it is not built into the premium. Unfortunately, the surety ship guidelines are not reality and losses do occur, even the most conservative bonding companies.

Surety bonds have been around for quite some time and we know that losses are inevitable no matter how good the underwriting is. If losses are inevitable, then why not change the underwriting philosophy? If a principal is considered to be a higher risk, then a higher premium rate should be applied. This thinking goes against traditional surety underwriting as losses would then be built into the premium.

I cant say that approving surety bonds to high risk clients at a higher rate is a new idea. In fact, we have been working with bonding companies that have successfully written high risk surety bonds for years. The rates are roughly 10-15 times higher for commercial bonds, but are usually still the best alternative for most that fall under the program. I can honestly say that we have seen little claims under the high risk programs. Definitely no where near 5-15 times as many as a standard market. Therefore, the sureties writing these programs are making out quite well for themselves. The few bonding companies have a monopoly on higher risk applicants, as there few sureties willing to take the risk of new surety guidelines, especially after the fall of the soft market.

Sureties writing higher risk contract bonds are even more rare. Bond approvals for five year contracts are unheard of these days, for most. Fortunately, there are some contract bonding companies willing to break the mold of traditional suretyship and take larger risks than the ridiculous expectation of a 0% loss. Similar to the high risk commercial bonds, higher risk contracts (i.e long contracts) will see increased rates. Surprisingly, the sureties willing to write the higher risk contract bonds do not have losses greater than their peers. The average loss ratio of our out of the box thinking contract bonding companies is 14.35%, lower than many conservative sureties. Once again, they have a monopoly on the market, as very few are willing to write these “hazardous” bonds.

Often, our agency is contacted by surety underwriters that want our business. They are well aware that we are a high volume agency that has a diverse range of accounts and they want a piece of the pie. We rarely get appointed with new sureties, as most offer the same as their competition. If they are going to try to increase their book of business they will have to think outside of conventional underwriting and rate guidelines. Why would we set our clients up with a surety that is the same as every other market out there? What they need to do is find market segments that are not overwhelmed with other sureties offering identical programs. Contact us if you are an open minded underwriter looking to expand your book of business. We have set up numerous programs that have been successful for quite some time. The programs are successful because unlike the higher risk bonds approved in the soft market of the past, they are approved with higher premium rates, which offset the cost of claims.

It is time that the surety industry wakes up and realizes that a 0% loss is not obtainable. Stop underwriting in the same fashion simply because it is the way business has been done for years. Forward thinking sureties are capitalizing an entire market segment; it is time the high risk segments become diverse with more bonding companies.

How Much Do I Have To Save For Retirement

We scrimp and save over the latest designer wear, even the hottest cars or fancy jewelry but only a handful of people have actually thought about protecting their financial future with private medical insurance. This beauty behind having a private medical insurance is that it enable you to live your life free from unwanted worry if you were to get sick or have an accident that results in unexpected medical bills.

If youre wise youll get coverage while you can still qualify for and afford it, which is before you need it. If you wait until youve been injured or sick, in most cases you wont qualify and if you do the monthly premiums will be extremely high.

Although, private medical insurance doesnt cover long-term illnesses, its designed to cover the financial burden of short-term illnesses and injuries, many people opt to choose private medical insurance since it can be a real help for certain emergencies.

An added perk of private medical insurance is that you actually get to choose which hospital you would like to be treated in, what specialist you would like to consult and what treatment you receive. In most instances, you will also feel like your moneys well spent because youll have the added perk of having your own private room complete with a television and other comforts of home.

If you are seriously thinking of buying private medical insurance, youll have to research which one of the vast number of reputable insurance companies actually provides the best overall coverage. Which one provides the best balance between premium cost and benefits so that if you ever need it, youll get your moneys worth with no surprises.

After applying for coverage, the carrier will send you their insurance policies to insure that you adhere to their requirements and standards. When it comes to which private medical insurance plan thatll best suits your needs and budget, it is wise to ask the insurance company that youre applying for a complete comparison analysis of the types of private medical insurance that they offer.

Ive listed a few samples of possible private medical insurance coverage below:

– In Patient: As a patient, this is wherein you end up staying in the hospital for one or more days.

– Out Patient: From simple treatments to mere consultations, the patient is not asked to stay in the hospital for observation or recovery anymore.

– Day Patient: Similar to In-patient coverage, this is where you still stay in the hospital but for less than a day, usually in the morning.

There is actually a great range of available payment options for private medical insurance buyers from the ever-popular, low cost coverage, which usually offers only limited coverage to the more extensive wide-ranging coverage and benefit plans. It is fairly simple to be approved for day and out-patient private medical insurance coverage, with in-patent being a bit more difficult due to the higher risk involved with extended hospital stays.

The next step is for you to actually get yourself to a trusted physician wholl give you a check-up so youll be able to know based on your physicians assessment which kind of private medical plan you best fit your future needs.

When it comes to choosing, youll actually need to consider these options:

– Always be sure that you are fully aware of the terms that are included in your private medical insurance plan.

– Do you want to have your private medical plan to also allow consultations from specialists as well as out-patient treatments?

– Would you like to have the option of picking out which hospital you would like to be treated at or doesnt matter where they send you to?

For your application for the private medical insurance plan, companies actually need a copy of details concerning your health so that theyll be assured that youre not just simply duping them into paying for your recurrent illnesses and you may not be covered for pre-existing conditions. Finally, when it comes to submitting your claim, you need to contact your private medical insurance company first before receiving any hospital services or treatments because you need to verify that your private medical insurance plan actually covers the treatment that you want or need to have done.

Your physician as well as the resident specialist in the hospital also needs to sign your claim forms to reassure the company that you have actually been treated for the said illness or injury.

How Much Money For Retirement

It seems everywhere you go these days, at least in the US, the conversations are about the price of gasoline.

No wonder, since its broken the $3.00 a gallon barrier and is causing a lot of people real hardships.

Im old enough to remember the gas lines of the 1970s when a similar situation occurred. At that time, I had a production services company in New England, in partnership with a man named, Irving Goldmacher.

In addition to being one of the two smartest people Ive known – my wife, Georgia, being the other – Irving was a fascinating person. I could probably write a book about him.

One day, in the midst of soaring gas prices, Irving went out and bought a new Caddilac, a car that was known to have low gas mileage.

I asked him if he had lost his mind, buying a gas guzzling car when gas prices were at an all time high.

“James,” he answered, “if the price of gas goes up, Ill just figure out how to make more money. Im not going to live my life worrying about the price of gasoline.”

Talk about a prosperity mindset! What a great outlook. Irving knew he was capable of creating whatever income he wanted, no matter what was going on around him.

This is the real key to living a prosperous life. Be in control of your income.

First, realize that your income comes from God and is not dependent on the economy. If you believe otherwise, youre in for a challenging time.

Then, develop additional streams of income to supplement whatever else youre doing. If you have a job, this might mean starting a part-time business.

If youre already in business, it may mean adding new revenue streams to your existing products or services. Whatever your path, it is crucial to have more than one channel of income.

Things To Do In Retirement

Want to buy a home in California? If so, chances are youll need a California Mortgage Lender to help finance your new house. Fortunately, the Internet has made the mortgage process easy. You can even find a lender online with very little hassle. Heres how to find a reputable California Mortgage Lender online:

Ask friends, family and neighbors

If you already live in California, some of the people you know in the state may have used a California Mortgage Lender online when they financed their home. Ask around among close friends and acquaintances to see if anyone can make a personal recommendation. Check with co-workers, family members and neighbors, too. A referral like this is often a good way to hear about the good–and bad–experiences people have had with various online mortgage lenders.

Watch out for predators

“Predatory lending” is a term generally used to describe any lender that is trying to take advantage of the borrower. Examples include charging high, unnecessary fees, pushing borrowers into a loan they cant afford, or using lies and deception to obtain clients. Carefully review all fees and charges–your lender is required to give you a “good faith estimate”–plus the fine print, like loan terms and prepayment penalties. Be on the lookout for any false or misleading information, or any terms that are vague and unspecific. If the fees seem too high or too numerous, look for a different lender.

Check with officials

All California Mortgage Lenders and Brokers should be licensed with either The California Department of Real Estate or The California Department of Corporations. To help ensure your California Mortgage Lender is legitimate and reputable, check with these agencies to see if your lender is licensed. Avoid any lending company that is not licensed or has allowed its license to expire.

Be sure to check with your citys Better Business Bureau office, as well. Theyll have a record of any complaints that may have been filed against your California Mortgage Lender.

How Much Do You Need To Save For Retirement

Many of us do not know how bailiffs work to collect arrears. Basically, bailiffs are private personnel hired by the local council to handle Council Tax and Poll Tax. Anything that they get from you is auctioned as a way of paying your existing debt. This process of taking your goods, selling them, and paying your debt is called “distraining” or “levying”.

Since October of 1998, the County Court ruled that bailiffs must carry a certificate with them as a proof that they have been hired by the local council. Any complain about a bailiff not following this order can be brought to the attention of the court immediately.

Since April of the same year, a process involving bailiffs and debts has also been at work. This process states that you, as a debtor, must get a letter from the Council which contains the details of your credits. The same notice would bear the warning that if ever you fail to pay your financial obligation within 14 days, bailiffs will be sent to your aid. You may contact a member of the local council within the period for your concerns. You can also make suggestions to the council about the most convenient payment scheme that you can afford. If the council approve of your suggestion, they will ask the bailiffs to stop calling you and save you extra fees in the long run.


One thing that you must know about bailiffs is that you do not have the responsibility to take them in whenever they come. In fact, you can choose not to let them inside your home. If the bailiffs have never been into your home, they have no right to come in at anytime of the day. It is also unlawful for them to break in.

As a form of precaution, avoid the following scenarios:

– Do not open your doors to the bailiffs. Once you entertain them, they will have the power to push past you. If they get inside, they will have the right to enter again and take more of your goods.

– Do not leave your doors and windows unlocked because bailiffs can easily take advantage of any kind of opening. As they cannot ask the police to help them break in, your carelessness is their only ticket.

– Do not fall to any kind of trap. Bailiffs can make several bluffs like asking to use the toilet or the telephone just so they can lure you towards letting them in.

– Do not leave your valuables lying around. Bailiffs can easily take away anything valuable that they lay their eyes and hands on. Make sure that your cars are always shielded from view.

– Do not make transactions inside your home. If you have a certain amount to pay the bailiffs out for your debt, do so but make sure that you transact outside. Do not forget to take a receipt as well.

– Do not sign anything that the bailiffs ask you to. The bailiffs do not have the right to make you sign any sort of document, whether it was left posted in your door or handed out to you personally.


If you allowed the bailiffs go inside your home at once, you are in for a more serious situation. Once bailiffs are let inside, they will have the right to come back again. If you choose not to let them in the second time, they will have the right to break in. What you can do to repair this problem is to get in touch with your local council immediately or make the necessary arrangements with the bailiffs. You can ask your local councilor for help or you can devise a specific payment scheme that you can afford and present it to the bailiffs. If they agree on your terms, you can prevent them from coming back and take any more of your things. Also make sure that you take a receipt of your every payment to be on the safe side.


Most of your valuables can be legally taken by the bailiffs except for the following:

– Anything that was rented or hired.

– Items or equipment that are necessary for your personal and professional use.

– Your basic daily needs such as clothing, bedding, and furniture.

You will notice that exemptions are not really item specific. The bailiffs may have different interpretation of which items they can take legally or not. If you feel that what they have taken away should have been exempted, you can file an appropriate complaint in your local council.


It has been clearly established by the law that the bailiffs can only take what are legally yours. This include items that you co-own with your partner. If the bailiffs attempt to take anything that you do not own, politely tell them about the items ownership by showing receipts or proofs of purchase that will indeed tell them that it is not yours. Also, the owner of the goods can make a sworn statement or a statutory declaration about the real ownership of the items.

Other things that bailiffs cannot take are the ones that are rented or hired. Make sure that you keep a copy of your agreement with the real owner so the bailiffs will not take them away.


It is legal to hide your valuables if the bailiffs have never been inside your home. Once they step in, however, they will list all the items they intend to take. If you try to hide any of those things elsewhere other than your home, you will be committing an offence that is punishable by the law. If you are able to keep the items discreetly out of sight, the bailiffs can rightfully search for them on visits.


The good news is that bailiffs cannot break inside your home just like that. They are also covered by certain laws and procedures that they must adhere to including the following:

– Bailiffs must bring with them a written authorization or a certificate from the local council.

– Bailiffs must hand you a copy of the “Enforcement Regulations” which contain information on what they are only allowed to do.

– Bailiffs must also bring with them a statement of charges that they can take with each visit. They should never make additions to blow up your debts.

– Bailiffs must also bring with them a “Walking Possession” agreement duly signed by you. This agreement contains the list of items that they have warned to take right from their first visit.


The most effective measure to stop the bailiffs from taking away your things is to make an arrangement on how you can pay your debt. Devising an effective installment plan will be beneficial for you especially if the bailiffs have never been into your home. Offer only what you can afford to pay to prevent any form of misunderstanding to take place.

The bailiffs cannot send you to prison. If they fail to break into your home, their most appropriate action is to pass your debt back to the council. If this happens, it would be much easier to settle the problem. You better take this as a priority debt because if you do not act on it immediately, the council will find another way to recover the money. They can file an Attachment of Earnings Order, which will take out money from your earnings or other form of order that will summon you to pay your financial obligations dutifully.

In some instances, the council may agree to exempt your case from bringing it to the bailiffs attention. The council allow direct payment schemes for those who are on Income Support, Pension Credit, and Job Seekers Allowance. Better yet, ask the council whether they can take back your case from the bailiffs so you can deal with them directly. Your local councilor can help you make the deal with the council. Explain your reasons and whatever difficulty it will bring you in case the bailiffs break into your home and take your things to stand a chance for a consideration.


There are Enforcement Regulations that the bailiffs must adhere to. However, the National Standards for Enforcement Agents issued by the Lord Chancellors Department is quite tricky. Although it provides specific guidelines on bailiffs behavior in carrying out their duties, mentioning these standards in your complaint may be or may not be beneficial to you.

The law concerning the bailiffs is complex but you can start learning it through by reading the law yourself and trying to understand every bit of technicalities in it. Your personal effort, however, may not be sufficient. If you can, it would be best to get a legal advice on what you can do against what you feel is unlawful action of the bailiffs.

Since October 1998, the bailiffs need to act with a certificate at hand. This certificate to collect Council Tax must be granted by the court. Filing a complaint against the bailiffs can have their certificate withdrawn and their right to enter your house forfeited. To file a complaint, you can write a formal letter to the Court Manager so he can administer a hearing. Once the court find substance in your complaint, it can rule out to cancel the bailiffs certificate, order compensation as well as return of the surrendered goods. Some cases acted favorably to the complainants where their debts have been written off due to the bailiffs illegal acts. This is one of the reasons why you should not take your complaint sitting down. Once you discover an irregularity, you must rush to the Magistrates Court to file a complaint.

The bailiffs report directly to the council and it would be ideal to bring your case there. Once it receives your complaint, it must order the bailiffs to change their procedures. If this do not work, you can call the attention of your local councilor or your local government Ombudsman to look through your case.


If the bailiffs are asking for excessive charges, you can use it as a case for complaint. You can make a written notice to the council telling them that what has been taken from you may be way too much. You can also seek advice from the County Court regarding the appropriate fines the bailiffs can charge you.

Your common sense and your knowledge on local processes can also be useful in determining what amount of fine is reasonable and what is not. If, for example, the bailiffs charged you $80 for attendance with a van and hiring a van costs only $40, you are obviously charged unfairly. When such circumstance takes place, you can instantly call the attention of the bailiffs. Warn them that you will take further action for your complaint to be recognized if they refuse to follow the regulated schedule.

Submit a written complaint to the council so they know how the bailiffs are illegally carrying out their duties. Other than that, you can also apply for a “Taxation” in the County Court. This kind of application will ask the court to look through your complaint within 12 months after which they should submit a decision whether the bailiffs charges have been excessive or not. If the court decides against you, you will be held liable for the bailiffs firms court costs. Thats why you must be careful in taking such action. Please remember, however, that making complaints is worth your every effort especially when you are loaded with evidences that will prove that the bailiffs stepped out of the line.

Retirement Account Types

Recent reports estimate that as many as one in ten of the population have been a victim of identity theft, one of the fastest growing crimes of the last few years. By using a variety of means to usurp your identity and pass themselves off as you, the criminals involved go on to commit fraud and theft in your name – leaving you to pick up the pieces afterwards.

The effects on your credit rating can be devastating and often take years to completely fix, so prevention is obviously better than cure. Here are ten simple ways to help you avoid becoming a victim.

  1. Be careful with your old documents such as paid bills, bank statements, and receipts. Either keep them safely stored or destroy them if you dont need them anymore. Dont just throw them away, as fraudsters often start stealing an identity by searching for these very kinds of documents in household waste. Shredding or burning unneeded papers will prevent this first step.
  2. Store your personal documents securely by keeping them somewhere out of the sight of visitors to your home.
  3. If you change your address, make sure that you inform your bank, utility companies, and everyone else who sends you mail. Documents wrongly sent to a previous address are a favorite target of fraudsters.
  4. Make sure that when you stop using a credit card or bank account, you actually formally close the account rather than letting it go dormant. Having an unused, forgotten about account resurrected by a fraudster might not even be noticed until serious damage has been done.
  5. Watch your plastic – make sure you know where your credit, debit and ATM cards are, and tell the issuing banks immediately if you lose them or theyre stolen.
  6. If possible change your PIN numbers and passwords to something easily memorable, and NEVER write them down, especially not on scraps of paper kept in your purse or wallet.
  7. Dont respond to phishing. Banks will never ask you for personal details via email, and wont ask you for the password to your account. You dont need to reconfirm your details following an email request either – just delete the email. If in any doubt at all, call your bank to make sure the request is genuine.
  8. Use anti-virus software and firewall on your computer, especially if you use online banking of any kind. Keep the software up to date as well to guard against attempts by hackers to discover personal information on your computer.
  9. Check your bank account and credit card statements carefully when you receive them, and query with your bank anything that you cant identify. Spotting a fraud in progress early on will vastly help in minimizing the damage it causes.
  10. Finally, monitor your credit reports regularly to see if anything appears that seems odd, such as applications for credit cards that you didnt make, or missed payments on finance that you havent taken out. Services are widely available online which can help you do this by automatically informing you when something on your file changes.

None of us can be 100% sure that we wont fall victim to the crime of ID Theft, but by taking the measures listed above youll be making the job of any potential fraudster very difficult indeed, and theyre likely to move on to an easier target.

Financial Retirement Planner

If you have decided to take or loan or mortgage then the facilities available are immense. There are wide variety of banking institutions, banks and brokers who are available to provide loan. It is only when an individual shops and finds the various lenders available and the schemes that they offer that he will be able to get the right loan at a good rate.

In case of a banking institution, the borrower is in contact with one person who is an employer of an organization and gives the various loan facilities offered by his institution. He is only an employee who gives the various facilities available by his employer. He helps borrower on the various facilities and choose what might be the best suitable for him. Once his personal credit information is approved, the employee processes the forms and helps the borrower and gets him credit.

The private lender is helpful when the individuals personal credit rating is bad and when the various banks and financial institutions refuse to give him any credit. The private lender asks for a security and charges high price. A mortgage broker on the other hand is only a middleman and gets credit to the individual from various sources that would be able to finance the individuals need. The rate involved might be high but a broker is the best solution for anyone with bad credit and who is unable to access any institution or banks for his credits. The broker or lender can sometimes give best deal to an individual when more business is promised. The individual can negotiate with a broker and get good credit facilities than when he goes online or approaches a bank.

One disadvantage with a private lender or broker is that the credit facilities are some time got from other places or outside the boundary of the individual and in this case the credit terms and conditions may not match that of the borrower and may not be to his satisfaction. Whereas a bank is a local institution and the employee can help get loans, which suits the need of the individual of the locality, and the credit facilities are tailor made to suit the individuals need.

Whatever is the difference between the bank and private lenders the borrower must shop around and know his limitations and the various facilities available from either of the sources and then approach that source which is most convenient to him.

Retirement Savings Accounts

Wells Fargo & Company (WFC) is a huge Western and Midwestern bank that provides a diverse array of financial services to its more than 23 million customers. The company employs more than 150,000 people at its over 6,000 locations nationwide. Wells Fargo has about $500 billion in assets.

While the company continues to derive more than half its revenues from interest income (about $26 billion), its activities are not limited to collecting deposits and lending money. Wells Fargo engages in other businesses such as brokerage services, asset management, and investment banking. The company also makes venture capital investments.

Over the last ten years, Wells Fargo has averaged a 1.57% return on assets and an 18.19% return on equity.


Wells Fargo is closely associated with California in the minds of most investors. The company now operates in 23 different states. However, the concentration in California remains.

Mortgage lending in California accounts for approximately 14% of Wells Fargos total loan portfolio. Commercial real estate loans in California account for another 5% of the companys total loans. No other single state accounts for a similarly sized portion of total loans. In fact, neither mortgage lending nor commercial real estate lending in any other state accounts for more than 2% of Wells Fargos total loans.


Wells Fargos focus on cross-selling is well known. The company has a stated goal of doubling the number of products the average consumer and business customer has with Wells Fargo to eight products per customer (from the current four products per customer).

Cross-selling increases customer stickiness. It also helps increase profitability by decreasing expenses relative to revenues. The need for a large physical footprint is reduced as is the need for a large number of bankers. Instead, the existing infrastructure is able to provide additional revenue from the same customers.

Wells Fargos Chairman & CEO, Richard Kovacevich, explains the importance of the companys cross-selling in the Vision & Values section of the corporate website:

“Cross-selling or what we call needs-based selling is our most important strategy. Why? Because it is an increasing returns business model. Its like the network effect of e-commerce. It multiplies opportunities geometrically. The more you sell customers the more you know about them. The more you know about them the easier it is to sell them more products. The more products customers have with you the better value they receive and the more loyal they are. The longer they stay with you the more opportunities you have to meet even more of their financial needs. The more you sell them the higher the profit because the added cost of selling another product to an existing customer is often only about ten percent of the cost of selling that same product to a new customer. This gives us as an aggregator a significant cost advantage over one product or one channel companies. Cross-selling re-invents how financial services are aggregated and sold to customers just like other aggregators such as Wal-Mart (general merchandise), Home Depot (home improvement products) and Staples (office supplies).”

Mr. Kovacevichs enthusiasm for the cross-selling model is well justified. It is difficult to quantify the importance of meeting all the varied needs of your customers, because you can not measure the opportunities you missed. However, it is obvious that reducing each customers interest in considering a competitors services will greatly increase long-term profitability for any company engaged in any line of business not just for a bank.

Later, in the same website section, Mr. Kovacevich addresses the importance of customer stickiness:

“(Cross-selling) is our most important customer-related sales metric. We want to earn 100 percent of our customers business. The more products customers have with Wells Fargo the better deal they get, the more loyal they are, and the longer they stay with the company, improving retention. Eighty percent of our revenue growth comes from selling more products to existing customers.”

This focus on retention is an important part of a long-term plan to maintain Wells Fargos above-average returns on assets and equity. Extraordinary profitability comes from differentiating your product or service from those of your competitors. Increasing customer stickiness and reducing comparison shopping is a key part of maintaining extraordinary profitability.

Some businesses are blessed with enviable economics because of their products natural prominence in the minds of their customers. Most businesses are obsessed with market share. But, how many really think about mind share? Obviously, a product like Coke (KO), Hershey (HSY), or Snickers is going to have a positive association in the minds of consumers.

For many people, these products will also have a prominent place in each customers mind (relative to other products and services on which money can be spent). A few other businesses have a healthy mind share without the positive association; GEICO is the most obvious example. The companys brand conjures up nothing but the words auto insurance. Of course, thats all the GEICO brand has to do.

So, what does all this have to do with Wells Fargo? Mind share isnt just the result of exposure to advertising. In fact, in most cases, exposure to advertising can not duplicate the kind of results that a direct, differentiated experience creates. Entertainment properties are by far the leaders in mind share. People who saw and loved Star Wars remember the film. In fact, they dont just remember the film, they actually file it away (or, more precisely, cross reference it) in countless ways within their mind.

The evidence for this particular example is abundant. There are countless references to Star Wars in other media. The name, the music, the opening text and countless other elements are immediately recognizable. Even the films Star Wars fans hated made more money than almost any other movies in the history of cinema and this was decades after the original came out. So, obviously Star Wars has the kind of lasting mind share any business should aspire to if it hopes to continuously earn extraordinary profits.

Unfortunately, most businesses, however well run, can not attain this kind of mind share. The products and services they provide can never be as differentiated and memorable as a motion picture. Just as importantly, the positive associations will not be present, simply because the product or service is not inherently exciting, entertaining, or pleasant. This is clearly the case in financial services.

So, what can a financial services company do to improve its mind share? The most obvious tactic is simply to wow its customers. In fact, Wells Fargos CEO discusses this particular option in the Vision and Values section of the companys website.

” We have to wow! them. We know what that feels like because were all customers. We go to the cleaners, the grocery store, a restaurant or whatever, and we find a situation where were wowed! We walk out and we say, those people really listened to me and helped me get what I need. All of us hear stories about customers, say, who pick a certain line at the supermarket because they know the person who bags the groceries connects with customers smiles, greets regular customers by name, asks how their families are doing. When a personal banker helps a customer in one of our stores, or when a customer gets help from one of our phone bankers or does transactions on wellsfargo.com we want them to say, That was great. I cant wait to tell someone.”

Another option worth pursuing is widening the associations present in the customers mind. Financial services is a business where associations tend to be more conscious, categorized, and hierarchical than the associations formed in more heavily branded businesses. Put simply, the (potential) customer usually thinks of a set before thinking of an element within that set. Like many mental associations, the information can be returned in either direction. For example, the customer may normally think banks and then think Wells Fargo, but will also be able to return the word bank if prompted by the name Wells Fargo. This categorization is important, because it provides (limited) permission for Wells Fargo to expand its mind share horizontally (across service categories).

In other words, providing a diverse range of financial services doesnt just make sense from the providers perspective, it also makes sense from the users perspective, because the user of financial services has already grouped deposits, borrowing, credit cards, insurance, brokerage services, asset management, etc. together in a very loose way within his mind. As a result of this mental network, one positive experience with Wells Fargo will greatly affect a customers desire to pay for an additional service, even if the two services are not really all that similar.

The three key elements here are: a broader definition of what Wells Fargo is (a place that does money things, not just a bank), a positive experience, and some sense of trust that the quality of service will be consistent. The last requirement is the easiest to meet, because its natural for a customer to assume that the positive experience was not a fluke, much the way a diner assumes the good meal he had at a particular restaurant was not caused by his picking the best offering from the menu. The diner usually assumes the overall quality of the restaurants various entrees is superior. Likewise, a good experience with one of Wells Fargos products or services will likely rub off on its other offerings.


Shares of Wells Fargo currently yield just over 3%. The stock trades at a price-to-book ratio of just under 2.75 and a price-to-earnings ratio of less than 15.


Over the last 5, 10, 15, and 20 years shareholders of Wells Fargo & Company have fared better than the S&P 500. As of the end of last year, WFCs total return over the last ten years was 17% vs. 9% for the S&P. Over the last 20 years, WFC outpaced the S&P 500 by an even wider margin: 21% vs. 12%.

Wells Fargo has a stellar reputation with investors. The company is the only U.S. bank to earn Moodys highest credit rating. Wells Fargo also boasts a well-known major shareholder. The largest owner of the companys common stock is Berkshire Hathaway. Warren Buffetts holding company has a roughly 5.5% stake in Wells Fargo. Berkshires last reported purchase occurred during the first quarter of this year.

Wells Fargo has a stated goal of achieving double-digit growth in earnings and revenue while managing a return on assets over 1.75% and a return on equity over 20%. Those are both very ambitious goals. The company has achieved some of the highest returns on assets and equity of any major U.S. bank. However, Wells Fargo will probably need to increase the percentage of revenue it derives from fee businesses if it is to achieve these goals.

In the years ahead, the company may well become more of a diversified financial services business. In fact, thats what I expect will happen. The companys commitment to cross-selling is not some fad. Eventually, this commitment will change the way investors think about Wells Fargo. Soon, it may be considered much more than a bank.

Wells Fargos CEO makes the case that his companys P/E is simply too low. Wells Fargo has a solid history of strong growth and profitability. So, why should it be valued similarly to most other banks? Shouldnt it be awarded a multiple more in line with a growth company?

Theres actually some merit to this argument. Wells Fargo is unusually well positioned for a bank. Often, those banks that seem certain to earn very high returns on assets and equity for many years to come are poorly positioned for future growth. These banks are often smaller than their competitors and focused on a specific geographic niche. Any acquisitions would dilute the exceptional profitability of the banks niche.

Of course, there are also many consolidators in the banking industry. Unfortunately, many of these banks do not have a history of earning the kind of returns on assets and equity that Wells Fargo has achieved. Even more importantly, there is little differentiation between these titans of the banking industry and their national competitors. Therefore, their moats are highly suspect.

Wells Fargo is a different kind of bank. It has a history of extraordinary growth and profitability. There are two obvious opportunities for future growth: geographic expansion and cross-selling. Of these two opportunities, its clear Im more enamored with the latter. An eastward push is not necessary, and certainly not via an ill-advised acquisition.

There is a lot of value in the Wells Fargo franchise and there is plenty of room within that franchise for future growth. Thats one of the great advantages of the financial services industry. With the right model, limits to growth are almost non-existent. In other highly-profitable industries, there is often nowhere to reinvest new capital at a similar rate of return.

If Wells Fargo is a growth stock, it is a peculiar sort of growth stock. Maybe that is what attracted Buffett to the company in the first place. Here is a business with a strong franchise that can grow for many years to come. Perhaps most importantly, it is a growth business that frequently trades in the market at value like multiples, simply because its a bank.

At the current market price, Wells Fargo is the sort of investment you make once and forget. The valuation is not so cheap as to promise a good return if the business falters. But, the business is not so suspect as to require the margin of safety be provided by a low P/E ratio. Sometimes, near certain growth is the margin of safety.

Median Retirement Savings By Age

Closing costs can surprise many homeowners if they arent prepared for them and can seriously deplete savings at a time when most people need money the most. It seems that lenders are constantly finding new and creative ways to tack on a few dollars here, and a few dollars there to the tune of thousands. However, by taking a few simple steps you can keep your closing costs low and know when to tell your lender that enough is enough!

First, you should always be a savvy consumer when it comes to title work. You have the right to select any title company you want and not the one that the mortgage company wants to force upon you. Of course, the mortgage company they want you to use always turns out to be one of the more expensive ones (because they are getting kickback fees). Shop around for a title work company and you can often save 30% right off the bat, and if you are willing to really work at it, save upwards of 50%. Its not chump change either – a title company can easily charge $1,200 for basic title services.

Next, be on the lookout for junk fees. Lenders love to pile on the document preparation fees, interest locking fees and anything else they can think of. Often times they throw these fees onto mortgages that have no points attached to them. Make sure that you ask your lender for a full disclosure of all the fees and then ask them about any that seem out of line. If you arent happy with what they quote you, tell them you are looking around at other lenders. The last thing a lender wants to do is lose 30 years worth of interest because of a $200 junk fee!

If you arent going to be in the house for more than a few years, ask the seller to pay the closing costs. Sure, youll end up paying a higher interest rate, but if you plan on moving in a few years then the cost of the interest wont match the closing costs you would have to pay up front. Plus, you pay the extra interest off is small chunks each month rather than being out a lot of money up front.

Watch out for lenders who try to sell you add-on products with your mortgage. They love to try and get you to buy credit insurance (a total waste of money) and some lenders even try and sell you services such as “plumbing protection” or “whole house appliance protection”. Just say no!

Remember, you have the power to say no thanks at any time before you sign on the dotted line. If you dont like the figures your lender is talking about for closing costs, shop around – in fact, you should around and get several mortgage offers before you even consider one. Dont be afraid to get up and walk away from the table. After all, its your money – dont let a greedy lender try to squeeze another $1000 out of you when you have enough stress taking place buying a home in the first place!