How Can CIA Help You?

Request Consultation
Ask an Advisor
Financial Tools
Request Consultation
Ask an Advisor
Financial Tools
The Truth About Diamond Rings

The Truth About Diamond Rings

These days with social media pictures everywhere, there’s more pressure than ever to buy the perfect diamond ring for your future fiancée. Did you know, though, that diamond rings have only been an engagement staple since the 1930’s?

While engagement and wedding rings have been around for much longer, it was only when De Beers launched a major advertising campaign in 1938 when they began to rise to popularity. De Beers later came up with the famous slogan, “A Diamond Is Forever,” in 1947 which helped diamond rings quickly become commonplace. Before the ad campaign you were more likely to see a bride wearing a sapphire or a different gemstone rather than a diamond because diamonds were considered relatively low-brow and even old-fashioned.

The marketing campaign behind diamonds also created the now common thought that to-be grooms must spend at least two months’ salary on an engagement ring. For many people, that’s a ridiculous amount of money to spend on anything, let alone jewelry!

It’s amazing to me to look back and realize exactly how effective a marketing campaign was at reshaping people’s image and budget for a stone. While a diamond might be forever, I would argue that so is granite, and it’s considerably cheaper.

What’s really important with purchasing an engagement ring is finding a ring that match’s your fiancée’s personal style. Whether it’s getting her a diamond, sapphire or a granite ring, the trick is to first do your homework, and know exactly what you’re looking to buy.

Once you know the direction you’re headed, then it’s time to put a budget to it. While De Beers and Madison Ave. execs will push you to spend two month’s salary, remember that that’s coming from a marketer, and not someone trying to help you get to retirement sooner. Instead, talk with your fiancée or at least think independently about what you think is a realistic and comfortable amount to spend.

If you’re paying for the wedding, thinking about buying a home, or have other looming financial obligations, you don’t want to spend all your savings on one piece of jewelry. Remember you can always upgrade your lady’s ring as an anniversary or holiday gift at a later time. The ring itself won’t be what causes your fiancée to say “yes or no” when you pop the question.

Many rings cost just as much as a car, and you wouldn’t go car shopping without having done your research. If you’re feeling like bucking the De Beer’s standard, and buying something other than a diamond engagement ring, then you need to do some research online for ideas on the price ranges associated with your options.

If you do decide to go in the newly traditional direction of a diamond engagement ring, be sure to learn about the four C’s; cut, carat, color and clarity. You can prioritize the four C’s to actually give you more flexibility when choosing your diamond. For example, if you’re looking to get the biggest carat possible, you might give a lower priority to the clarity to free up some of your budget for a larger rock.

Bottom Line

You should not feel obligated to purchase a diamond or to spend two months’ salary on an engagement ring. These “traditions” were made up by an advertising agency in the 1940s. However, when you’re going to make a large purchase on any kind of engagement ring, you should first do your research and also set a budget. There are several online articles and tools (such as Price Scope) that you can use when researching engagement rings. I would suggest going to and reading some of the articles that we’ve put together on engagement rings, and setting up a savings goal to track when you’re ready to make that big purchase.

Congratulations on taking this big life step!

Read the original article here.


Should College Be Free?

During a recent visit to Tennessee, President Obama announced that he wants to start a (mostly) federal program which will allow anyone, regardless of socioeconomic status, the ability to attend community college for two years for “free”.

Unsurprisingly, this has created some controversy, and when I mentioned it on my Facebook page many people felt moved to comment on it both positively and negatively.

While I strongly believe that everyone in the US should have an education and the ability to further it as they see fit, the questions here are:

• Is affordability really the barrier to closing the education gap in America?

• If so, should the rest of the population pay for it?

According to this article from The Wall Street Journal, the President said his goal with this bill is to once again see the US have the highest proportion of college graduates in the world. The reasoning behind this goal is to create more skilled workers and ultimately give them enhanced upward mobility.

Unfortunately, according to federal data, only one in five students attending a community college goes on to earn their bachelor’s degree within six years. On top of this, only 21% of first-time, full-time students earn an associate’s degree within three years.

Megan McArdle for Bloomberg points out that community college is already greatly reduced or free for many people who fall into the lower and middle class, so who is this bill really helping?

It seems like instead of addressing the real issues of creating a thriving middle class, this administration believes they can fix this problem by throwing taxpayers’ money at it.

So if cost is already not a barrier (thanks to programs such as the Pell Grant, the Academic Competitiveness Grant, FSEOG, and the SMART Grant), then why would lowering the cost even further using taxpayer money increase these graduation rates?

Is it really taxpayers’ responsibility to pay for an additional two years of public education? Should the federal taxes Georgians pay be used for someone’s schooling in North Dakota or Texas?

In the proposal it states that the federal government will cover 75% of the cost and states will cover the remaining 25%. In all it will cost taxpayers roughly $60 Billion over 10 years. With the US government already holding $17 trillion in debt, shouldn’t we look long and hard before committing to that type of spending?

Furthermore, I believe that most people who received a higher education will tell you that what they really learned during their time in college were the life skills of being an adult. They learned how to hold themselves accountable, manage a schedule (both work and school), balance their personal budget, and then tackle tuition payments and student debt using the very skills they paid to learn. By making the first two years of college “free” for everyone, we may be dangerously minimizing or even eliminating the thought that spending time and money for school is an investment.

For most people, a college education has to be an investment. Part of the growing up process is actually having skin in the game. If college becomes an entitlement that every student receives, while taxpayers deal with the financial consequences, we are adding yet another layer to an already enriched entitlement based system.

Bottom Line

I agree that educating young Americans is a keystone to the continued economic vitality of the United States. The reality, though, is that I just don’t see how a $60 billion spending program targeting a problem that doesn’t exist (affordable higher education) is going to help solve the real problem of a growing education gap here in America.


Read the original article here.


Is Cheap Gas a Good Thing?

While the stock market has been making new highs over the last few weeks, there is one sector that continues to drop… dare I say plummet!

In June, a barrel of oil cost $107, today (less than six months later) we are at $66 per barrel. That’s a drop of 38 percent.
This has certainly had a positive impact for us at the pump. Nationally, gas is at $2.72 while Georgia has an average of $2.65… and falling. To put that in perspective, in June, Atlantans were playing closer to $3.70!

This is wonderful for you and me as we are able to enjoy this drop in price when we’re filling up our cars… but what about the rest of the US economy?

Energy stocks have hit a brick wall. While many energy sector stocks were up around +15 percent this summer, they’re now looking at a minus 10 percent return for the year.

There are several reasons why we have seen oil prices drop since the summer. First, there has been lighter demand growth around the globe for oil. China and Europe’s slower economies haven’t been as demanding of “black gold” as they face slower growth in 2014. Second, there is a persistently higher supply right now due to new drilling technology, tremendous amounts of new oil supply found right here in America, and the Middle East oil power houses having decided to keep their output supply as-is.

In a much anticipated announcement on Thanksgiving Day, OPEC (Organization of the Petroleum Exporting Countries) decided not to cut their production targets. They, of course, could have chosen to stabilize the price by producing and exporting fewer barrels of oil per day… but that’s not how it played out. Why would they do this?

There are oil producers/competitors all over the world that can’t survive with oil prices much lower than they are today. The US’s new oil producers represent some of that contingency and there are many other international producers likely to decide to shut down higher cost oil exploration, as well.

Ultimately, I think the countries in OPEC (especially Saudi Arabia) are flexing their muscles in an effort to reassert themselves back into the director’s chair. Unfortunately for the Saudis, though, I just don’t see this playing out in the long run. They are just too dependent on their one trick economy. On top of that, low gas prices are good news for consumers and businesses here in the US.

Let’s circle back to the original question; are low oil prices bad for our economy? Is it bad for oil dependent companies?

Of course it is, at least in the short term. However, the major US oil companies have plans in place for situations just like this and are likely set to ride out this drop in prices. In the meantime, economic growth for the third quarter was actually revised up from 3.5 to 3.9 percent. That’s almost 4 percent growth! It’s easy to see where this comes from, as well.

For every $1 per gallon drop in prices at the pump, you and I are going to save about $1,000 a year on gas. Just think about how big a dent that is for a family bringing in $50,000 a year?! That extra money is going to get spent somewhere, whether it’s Target, Amazon, Delta, or even a neighborhood shop.

This is exactly why we have seen stocks for airline companies, retailers, and hotels rally as oil prices have dropped. It’s not just these guys that win when the cost of oil and gas goes down, though. Transportation actually gets a huge lift. UPS and FedEx rallied on the oil price drop, as well. The chemical industry, groups producing plastics, rubber, asphalt, paint and more, also saw an increase in value. Even agriculture got a bump.

While OPEC drops the price of oil around the globe, leveraged oil companies (the ones with the most debt) are no doubt feeling the pain. US oil stocks also get hurt (i.e. the recent pain we’ve seen in the stock market). However, while OPEC plays the waiting game with their competition, the US consumer economy should be getting a huge boost!

The energy sector makes up less than 10 percent of the S&P 500, so a fraction of the overall market is getting hurt. Meanwhile, many of the other nine sectors in the S&P (and don’t forget you and me) are likely getting a little relief .

Bottom Line
Could this take out some of the most marginal, border-line energy companies across the globe? Yes. Could this dip hurt the junk bond market? To some extent, yes. However, the way I see it, for now the good outweighs the bad when it comes to low energy prices.

Read the original article here.


Get Started Today

Request Consultation
Ask an Advisor
Retirement Calculator
Retirement Calculator
Social Security Optimizer