Tuesday, April 10, 2007

Financial Magazines And Their Headlines



It might be the most annoying thing in my money world: The headlines and taglines thrown out there by the likes of Kiplinger's Personal Finance, Money magazine, and all the rest.

Case in point would be the May 2007 issue of Kiplingers. I've taken the liberty to scan the cover and display it at the right.

Sure, there's the nice all-caps headline of "TRIPLE YOUR MONEY" right smack in the middle of the page. I hate crap like that, and I hate it with every ounce of my being. Seriously. Such overhyped, ridiculous prose graces these mag covers most every month, and I'm damn sure not the first blogger to notice.

But wait. What's even worse is the caption for the dashing, grinning, and attractively-airbrushed couple we're shown: SHANNON and DARREN POLLACK invested in gold and small-company funds, and saw their money triple. (Notice the shiny gold bars right above the caption, stacked ever so quaintly on the table. Five bucks says there's chocolate inside those wrappers.)

Journalistic wind-ups like these are maddening to me ... but also interesting. If readers like me could easily "triple our money" with the info that Kiplinger's so kindly bestows upon us, then this magazine wouldn't be collecting dust on newsstands for the lowly price of $3.50, now, would it? There'd be outrageous demand for the thing, and Kiplinger Washington Editors wouldn't be able to keep up, and their printing presses would probably go into some sort of nuclear meltdown — at least until they get tired and shut the place down and decide to just go out for some nice frozen custard.

But ... they don't. And the reason is that what you'll typically find when you read the TRIPLE YOUR MONEY articles is either (1) common-sense investing stuff, with important performance data conveniently scrubbed from the headlines, or (2) stories of nicely-presented Middle Class Folks and how they just flat-out got lucky in some market, somewhere (though you'll never hear it described that way). All of which makes me glad I paid next-to-nothing for my long-term subscription to Kiplinger's. Because that's what pap like this is worth.

Anyhow, this particular article would fall into Category 1 above, as we discover merely by reading the article's subtitle: 25 ways to earn 200% over five, eight, ten, 15 or 20 years. It's easier than you think.

Really? You don't say!

Ah, well. The Pollacks' investment aptitude may or may not be noteworthy. They tripled some of their investments over the course of the last five to ten years. I mean, I give kudos to them. Really I do. But let's check in on their mirror-images in investing, the Dipflatchets:

Joe and Jane Dipflatchet invested in Nigerian-cardboard manufacturers and over-leveraged multinationals, and saw the last of their retirement savings decimated.

Of course, you'll never see the Dipflatchets on the cover of Kiplinger's ... at least not until I take over the publishing reins. Unlike the editors at Kiplinger's now, I'd just be upfront and realistic. And, of course, I'd sell fewer copies than KPF already does. But still ... Dipflatchet happens, too. Every day.

The way I see it, headline hype has had its time in the financial sun. Misery and bad fortune need a glossy showcase, too.

Just to balance. Things. Out.

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— Posted by Michael @ 10:26 AM








5 Comments:
 

rags like Kiplinger's and Money are no different than the dozen or so men's fitness-type landfill fodder magazines that all present 12 slight variations on "lose your gut!!" every month.

 

(sorry about deleting my original comment)

You know, I really like Kiplinger's. It is kinda pretentious some time, but I haven't found a personal finance mag that I like better.

I did like your article, though!

I wrote about some here:
http://genxpersonalfinance.blogspot.com

 

You know, I have one stock in my IRA that increased by 1000% over 4 years (it's gone down to about 650% of my original cost). But it's not going to make a huge difference in our life.

We bought a similar stock, using the same logic and analysis, around the same time, and it went down by 70%.

Your point is well taken, the money mags would cover the 1000% gain, but not the, just as likely, big loss.

That's why we keep 90% of our retirement in mutual funds with a long history of good solid (but not extravagant gains). Then we can weather the losses or and celebrate the gains of these other investment, without a huge risk to our core retirement goals.

 

The headlines and taglines thrown out there by the likes of Kiplinger's Personal Finance, Money magazine, and all the rest.
-------------- haha

 

In fairness to Kiplinger's I will share my experience. I paid one dollar for my subscription. While reading the magazine, I learned about a special retirement tax credit for low-income earners that literally "paid" me to invest in my retirement. My accountant said that credits like that were dumb because it's a Catch-22. Anyone eligible never has the cash. Luckily, the IRS doesn't require you to put the money in a traditional IRA until after you get your refund back. I think I more than got my money's worth from this magazine. Now if only I could get into a higher earning category! I want to be paying taxes and lots of them! -Single mom doing her darnest to make it

Anonymous Anonymous
, at 5:41 AM, April 29, 2007  
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