Not only are banks not paying you for your deposits anymore (OK, maybe a few pennies here and there); but many of them are now forced to charge you for basic services that have been “free” for years thanks to Dodd/Frank (which severely limited what bank’s ability to charge merchants that took debit/credit cards). Now that “swipe fees” have been crushed…so has free checking. So, where does one go to earn money on savings now? If you have some time to wait, we have a few great options to consider....
While earning 10% on your investment, especially after the year we’ve had, may seem out of reach…it’s not as hard as you may think. While it’s difficult to predict the direction and magnitude a stock’s price will undertake over any particular period of time; doing the homework on dividends and whether or not they can be supported is much easier. We have two stocks for you to choose from that will give you a 10% dividend. That’s correct, you read it correctly. While you can’t even get a bank to give you 1% on your savings unless you lock it up for 5 years or more; we have two stocks that’ll pay you a 10% dividend just to own them....
If you have been in the stock market in 2011 then you know how bad things have been. It’s been a terrible massacre. Even though we’re off the lows of the year (1080 on the S&P 500 Index), around 1,200, we are 160 points from the highs of the year. Even when the S&P 500 was at 1360, many stocks were trading at very fair valuation. Valuation is often a good measure as to whether or not the stock market has “gotten out of hand”. When an investor looks at valuation now, many stocks are trading with a single digit P/E (stock price / full year of earnings per share (EPS))....
This market has been tough; there is no doubt about that. By all estimates (and actual numbers), corporate earnings have continued to improve quarter by quarter since the bottom in March of 2009. Earnings for the 1st quarter of 2009 came in at $7.52, while the most recent quarter earnings for the S&P 500 came in over $22 on the quarter. Those numbers are 3 times higher they were at the bottom in 2009. The P/E (if you multiple the quarter by 4 (4 x 7.52 = 30.08) and then divide it by the S&P 500 level at the time, around 666) back in March of 2009 came in around 22.14. The recent quarter came in above $22, say $22.20 and the market now trades at a 13.21 P/E. The stock market is much more attractive now that it was two years ago…at least on a valuation basis....
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