With the open enrollment period for the Affordable Care Act, better known as Obamacare, almost over, there is still widespread uncertainty about the law and precisely what it does. This uncertainty is particularly true for the previously uninsured, many of whom are now dealing with a complicated set of insurance terms they have never previously encountered. With the individual mandate set to penalize those who do not sign up for Obamacare insurance by March 31st, this is a key time to learn everything you can about this transformative law. In this video, health care analysts David Williamson and Michael Douglass explain the three key terms investors and consumers should know about Obamacare: the metal plans, the individual mandate, and the so-called "death spiral."

Metal plans help consumers understand the so-called actuarial value of their plan, or what percentage of essential health benefits their plan covers. The lowest actuarial value plans are bronze, followed by silver, gold, and platinum. The death spiral refers to the fear that the final insurance pool for 2014 may be less healthy than insurers had anticipated, causing them to lose money and thereby raise premiums next year. Michael and David consider the two main issues with the death spiral argument. The individual mandate, or the law's requirement that all individuals get insurance or face tax penalties, has consistently been the least popular aspect of Obamacare, but hospitals, including large for-profit operators Tenet Healthcare and HCA Holdings , are poised to benefit. See the video to find out why.

Google wants Android in everything.  Will Apple respond with iOS-powered scarves? Who stands to profit more from the release of the highly anticipated Xbox One game, Titanfall? And does Lady Sif's ratings-boosting appearance on Marvel's Agents of S.H.I.E.L.D. mean we'll see more Asgardians soon? Ellen Bowman, Nathan Alderman, and Tim Beyers have these stories and more in this week's episode of 1-Up on Wall Street!

Tax season is a tough time for all Americans, but those who pay state taxes as well as federal taxes have an added burden. What many don't know, though, is that they might be able to use state-tax payments as a deduction on their federal returns.

In the following video, Dan Caplinger, The Motley Fool's director of investment planning, looks at state tax deductions. Dan notes that you can itemize certain state tax payments, making them available to anyone who doesn't take the standard deduction. Unfortunately, you have to choose between a sales tax deduction and an income tax deduction, with those who have to pay both only getting to take one. Dan runs through the rules for claiming these tax deductions, pointing out that for income taxes, you can only deduct what you actually pay, but for the sales-tax deduction, you can use special IRS tables rather than having to calculate every single purchase you made. For high-income taxpayers, though, the Alternative Minimum Tax can take away your state tax deduction. 

There seems little worry that PotashCorp  will cut its dividend -- which it called "sacrosanct" this past December -- even though it's planning on cutting some 18% of its workforce this year in the face of flagging demand.

Neptune Terminal facility, Vancouver, B.C. Source: Canpotex

Yet, Europe's leading potash player K+S just said that, because of the upheaval that's occurred in the market, it was slashing its dividend by 82% for 2013, reducing the payout ratio to just 11% of adjusted after tax earnings, a far cry from the miner's usual ratio of between 40% and 50%. Could this signal a new era of austerity that will ultimately see Potash, Agrium , and Mosaic  end up whacking their payouts, as well?

Revenues at K+S barely moved at all last year, creeping up to 3.95 billion euros from 3.935 billion, but operating earnings fell by 18% from the year ago period because of lower potash prices. China recently set a new, lower floor for pricing after reaching an agreement with Russian potash producer Uralkali for $305 per metric tonne for the first half of 2014, a 24% discount to the levels paid in the same period last year. Shortly thereafter Canpotex, the North American potash marketing arm owned by PotashCorp, Agrium, and Mosaic,  also signed a contract for the sale of the fertilizer nutrient into China. Though it didn't disclose the deal's value, it said it was at competitive rates. Last year, it had secured a price of $400 per tonne.

There was a lot of speculation beforehand on what price China would pay for potash, as its purchases typically set the tone for contracts everywhere. It's the world's biggest wheat grower and second-biggest corn producer, so it remains a significant importer of potash along with the U.S., India, and Brazil. Buyers held off on making purchases until greater clarity was given as to where pricing would go, though the market expected them to settle in the $300 level following the breakup of the Belarusian cartel last summer; but no one wanted to be first to jump the gun.

Potassium Chloride (Muriate of Potash) Spot Price data by YCharts

With that event out of the way now, however, the surety potash producers were seeking seems to have returned. There's even the possibility the cartel will get back together, possibly leading to higher prices once more. Uralkali broke away from the partnership it had with Belaruskali in a bid to gain more market share. As a low-cost producer, it was willing to sacrifice price for volume. That sent everyone else into a tailspin, and caused the slump that led to K+S slashing its dividend.

The miner will use the savings to bump up its own production by expanding its Legacy project in Canada, with the goal of bringing it online in 2016 despite the weak pricing environment at the moment.

A dividend cut for PotashCorp still doesn't appear to be in the cards. Unlike K+S, which discontinued its nitrogen operations in 2012, the North American producer achieved record nitrogen sales volume of 5.9 million tonnes last year, 19% above the year-ago totals, even though prices were weaker. It's also still producing significant amounts of free cash flow, almost $1.6 billion worth at the end of 2013, suggesting it has substantial financial resources still available to it.

Agrium, on the other hand, burned through cash last year, recording a $100 million deficit in free cash flow, which could always pressure its payout that is currently yielding 3.2%. Mosaic, the fourth largest producer of potash in the world accounting for approximately 14% of estimated global annual potash production and 43% of estimated North American annual potash production, was also FCF positive, which should keep its 2% dividend intact.

If the situation in the Ukraine breaks down further, and sanctions are imposed on Russia, potash producers could even gain as potash remains an important export for the country. Although K+S found it expedient to cut its dividend to finance its growth program, I don't see Potash or Mosaic following suit. If conditions fail to markedly improve, however, Agrium could see pressure mount to conserve its cash.

The national debt United States is a national nightmare for a fairly large part of the population. There are debt clocks aplenty  online, tracking in real time a whole mess of money flowing every which way: how much the country owes, how much it takes back in taxes, how much it spends, how deep the deficit grows, and how much its citizens owe for mortgages, credit cards, and student loans. If we don't balance the budget and get our house in order, it's doom and decay and slavery in a Mad Max sort of world, or something similarly apocalyptic.

The national debt clock outside the New York City IRS office in 2012.
Source: Wikimedia Commons.

But here's the truth: The United States isn't the most indebted country in the world in several ways. Sure, no other country carries as much nominal debt (ours was $17.5 trillion at last count), but our government-held debt-to-GDP ratio is lower than that of several other countries, which includes Japan (leading the world with a 242% debt-to-GDP ratio), Greece (174% debt-to-GDP), Italy (133% debt-to-GDP), and Portugal (125% debt-to-GDP).

That's not the only debt metric on which the United States "underperforms," either. Bloomberg recently put together a comprehensive list of countries with over $100 billion in GDP, ranking them not on the basis of debt-to-GDP but by debt per person. Here, too, the United States finishes behind Japan, but simply ranking countries by per-person debt tells us less than it could, since median per-capita incomes will vary quite a bit from country to country.

How long would the average citizen of these countries have to work -- assuming that apocalyptic Mad Max scenario of total debt slavery comes to pass and no one is allowed to spend anything on themselves -- to pay off their country's national debt? We'll call this the per-capita debt-to-income ratio. Keep in mind that median incomes will be lower than typical salaries because everyone in the world doesn't actually work. Let's take a look at the results, particularly at the most and least indebted countries in the world...

The benchmark
United States: 107% debt-to-GDP ratio, $58,604 debt per person
Median per-capita income of $15,480, 3.8 years of work per person
The United States has a hefty burden, but it's far from the worst on Bloomberg's list. Nine other countries have worse debt burdens on a per-capita debt to income ratio. That's largely because few other countries have higher median per-capita incomes than the United States -- but none of those countries would need to work each citizen for more than 1.9 years to pay off their national debts.

Source: David Mark via Pixabay.

The nightmare scenario
Japan: 242% debt-to-GDP ratio, $99,725 debt per person
Median per-capita income of $10,840, 9.2 years of work per person
Japan has been a debt glutton ever since its stock-and-property bubble burst in 1989. The country's debt-to-GDP ratio was scarcely over 50% in 1980, and its debts rose only modestly to 67% of GDP by 1990. However, Japan's government debt has soared since the mid-'90s, cresting 100% of GDP by 1998 and pushing past 200% of GDP in 2009. Today, Japan has the worst showing of all nations in debt-to-GDP, in debt per capita, and in per-capita debt-to-income ratios.

The only comparable events in history where a large developed country pushed its debt-to-GDP ratio past the 200% threshold were recorded in Britain twice (once from the mid-18th to 19th centuries and once from World War I through the Vietnam era) and in France once (following World War I). The long-run outcomes of these events already appear to be playing out in Japan today as the country gradually diminishes in political and economic might. A rapidly graying population, a far-below-equilibrium fertility rate of just 1.39 (a rate of 2.1 is required for population growth), and a cultural resistance to immigrants all combine to create a nightmare scenario for heavily indebted Japan. The country hasn't exactly imploded, but it's hard to imagine a situation in which Japan can simultaneously pare down its debts while improving its economy.

The long shot
Ireland: 121% debt-to-GDP ratio, $60,356 debt per person
Median per-capita income of $8,048, 7.5 years of work per person
Ireland ranks second among all nations in debt per person (the United States is third), and it places third behind Singapore in terms of per-capita debt-to-income. Ireland's debt-to-GDP ratio has soared since the financial crisis -- it hit a low of 25% in 2008 and is now nearly five times as high. It hasn't helped at all that the country's per-capita GDP plunged after the crisis, from a high of $51,720 in 2008 to just $46,180 last year.

Tough austerity measures have not yet borne fruit for the Emerald Isle, which should be a lesson for any hardcore deficit hawks. However, bond investors now believe that the country is on the right track, as its 10-year bonds recently sold at a yield of just 2.967%, which is barely over the 10-year Treasury rate of 2.66%. The country's attractive tax rates and easygoing business regulation also continue to draw in high-skilled jobs, but not yet at a rate that has pushed the economy back on track. Taxes may have to spike on companies that have for years treated Ireland as a tax haven if the country is to effectively reduce its debt burdens.

Source: Stanley Howe via Geograph.

The best in class
Saudi Arabia: 3% debt-to-GDP ratio, $687 debt per person
Median per-capita income of $4,762, 0.1 years of work per person
The low end of the per-capita debt-to-income scale is packed with petrostates. Saudi Arabia leads, but just barely -- Iran has just 10% debt-to-GDP and a 0.2 per-capita debt-to-income ratio, while Kuwait is right behind at a per-capita debt-to-income ratio of 0.3. Saudi Arabia and Kuwait are the only nations on our list with a debt-to-GDP ratio of less than 10%, and Iran's ratio 10.4% barely misses the mark.

The lesson here is pretty easy to find: If you find an ocean of oil underneath your country early on (it was discovered in Iran almost a century ago and in Saudi Arabia in 1938), you can write your own meal ticket on the global financial markets. Developed nations like Japan and the United States can't hope to replicate this sort of economy, but it might not be a good idea to try -- oil money has turned Saudi Arabia into a well-lubricated welfare state, as some 40% of the country's under-30 population  is unemployed. As the country grows accustomed to its easy prosperity, it could begin to use up too much of its own meal ticket, and a Chatham House research report recently predicted that the Saudis could become oil importers  by 2038. As that happens, debts will surely shoot through the roof as the desperate ruling family struggles to keep its citizens placated.

Scroll down for the full list, ranked by per-capita income-to-GDP ratios.

Sources: Bloomberg (debt figures) and Gallup (median incomes). 

With the SPDR S&P Biotech Index up 59% over the trailing-12-month period, it's evident that investment dollars are willingly flowing into the biotech sector. Keeping that in mind, let's have a look at some of the rulings, studies, and companies that made waves in the sector last week.

To put it mildly, it was a busy week with a cornucopia of data, collaborations, acquisitions, and regulatory actions. Let's start off with some of the clinical studies that made waves this week.

You have to start somewhere
It may be early stage data, but Achillion Pharmaceuticals and Rexahn Pharmaceuticals  got off the right foot this week.

On Friday Achillion reported positive clinical activity for ACH-3102 in combination with sovaprevir in treating genotype 1b hepatitis-C patients. According to the oral presentation given at the Asian Pacific Association for the Study of the Liver conference in Australia, 100% of the eight patient cohort experience a sustained virologic response (i.e., an elimination of detected level of the disease) at the 12-week mark when ACH-3102 was combined with sovaprevir and a twice-daily ribavirin. As Achillion's press release noted, it remained a perfect eight-for-eight even though some patients presented with the Y93 mutation. While certainly encouraging, I'd caution investors that Achillion has fallen way behind its oral hepatitis-C peers, Gilead Sciences and AbbVie, and its opportunity to make a dent in the HCV market is dwindling by the day.

It was also an encouraging week for clinical-stage biopharmaceutical company Rexahn Pharmaceuticals which announced positive initial results from its ongoing phase 1 dose-escalation study of supinoxin (formerly RX-5902) as a therapy for solid tumor cancers. Thus far the main conclusion is that the therapy is safe with three dosing cycles completed and no drug-related adverse events. Similar to Achillion, I would encourage investors to understand that this is very early stage data and Rexahn hasn't even discovered the maximum tolerated dose as of yet. Until we have more concrete efficacy data to go on, such as a phase 2 interim analysis, I would suggest sticking to the sidelines.

Going shopping
OK, so we didn't have any major blockbuster mergers and acquisitions this week, but mid-cap KYTHERA Biopharmaceuticals did acquire all rights to experimental submental fat-reduction drug ATX-101 outside of the United States and Canada from partner Bayer. Under the terms of the agreement, Bayer will receive $33 million in KYTHERA's common stock as well as a $51 million note due in 2024. The move makes sense on KYTHERA's part as long as it believes ATX-101, which helps fight unwanted fat under a patient's chin, will sell well in Europe and the Asia-Pacific region. I will say this, aesthetic therapies that improve self-confidence are often very resilient to a weak economy, but at two times potential peak sales of the drug, and having to divvy out a good chunk of revenue for ATX-101 in the U.S. and Canada, all of that optimism is likely baked into KYTHERA's share price.

In addition to KYTHERA's purchase, clinical-stage biopharmaceutical company Tesaro announced a collaboration with privately held AnaptysBio on Thursday to get ahold of its immunotherapy platform targeting PD-1, TIM-3, and LAG-3. As part of the agreement, Tesaro will pay AnaptysBio a $17 million upfront licensing fee, and could owe an additional $18 million in milestone and development payments for each program, as well as $90 million based on U.S. and ex-U.S. submission and approvals per program. For Tesaro, though, it gives the company early stage exposure to immunotherapeutic drugs which are currently all the rage, and it allows Tesaro to control the clinical development process, manufacturing and marketing once a drug clears preclinical trials. I'm definitely intrigued by the deal, but Tesaro's valuation just seems a bit frothy if you ask me considering how young AnaptysBio's immunotherapy platform is at the moment.

German daily double
Perhaps the most exciting move this week if you're a bull comes from Northwest Biotherapeutics , or NW Bio, which gained 27% after receiving a duo of temporary approvals in Germany for DCVax-L as a treatment for all glioma brain cancers. According to its press release, the German equivalent of the FDA is granting NW Bio's immunotherapy DCVax-L a hospital exemption allowing it to be used on glioma cancer patients and giving NW Bio the opportunity to charge full price for the treatment. This exemption has an approved term of five years.

Separately, DCVax-L was also cleared as eligible for reimbursement through German sickness funds (i.e., insurance companies), which prompted six hospitals to apply for reimbursement eligibility. This represents a solid first step in validating DCVax-L and should help generate revenue to offset some of its ongoing losses, but its phase 3 study of DCVax-L in the U.S. for glioblastoma multiforme, the most lethal form of brain cancer, should remain the focus of shareholders in the meantime.

Geron-imo!
Finally, clinical-stage cancer-focused biopharmaceutical company Geron jumped off the proverbial cliff on Wednesday after it announced that it had received a full verbal clinical hold request for imetelstat from the FDA after meeting with the regulatory agency the day prior. The hold relates to the occurrence of low-grade liver function tests in its polycythemia vera, or PV, trial and the need to study whether or not this condition is reversible. It also suspends the remaining patients being tested in its PV and multiple myeloma study.  

We got our first hint of possible problems in late January, when an investigator-sponsored trial by the Mayo Clinic for myelofibrosis saw 20 of 79 patients drop out, which seemed inordinately high at the time. Without imetelstat Geron is pretty much a sitting duck with no other ongoing studies. The translation for shareholders here is to stay far, far away until we have word from the FDA on what's next for imetelstat! Shares ended the week down 60%.

Sunday nights have become the new "it" night for TV, but if you're a network without one of those "must-watch" shows it's not easy to break into the mix. This Sunday, NBC (a subsidiary of Comcast ) is going to attempt to do just that, but the odds don't look to be in its favor.

NBC's 'Believe' (Credit: NBC)

Battleground Sundays

AMC's The Walking Dead, HBO's True Detective, PBS' Downton Abbey, and Showtime's Shameless are just a few of the shows that have thrived on Sunday nights this winter, and that's not counting broadcast series like Fox's Family Guy and CBS' The Good Wife. In other words, it's a stacked deck and audiences have clearly picked favorites.

For NBC, while the network is bulletproof in the fall thanks to the highly successful (and profitable) Sunday Night Football franchise, come spring it's vulnerable. For the past few years NBC's business model has been football in the fall and Celebrity Apprentice in the spring. Yet with Donald Trump becoming increasingly polarizing, NBC hedged this season and decided on a new approach that could prove just as risky.

Serialized siblings

NBC's 'Crisis' (Credit: NBC)

The network will launch Believe and Crisis, two new scripted dramas back-to-back starting this Sunday. Both have star power in front of the camera and behind it, but both are highly serialized and require a time commitment from audiences. That's asking a lot of viewers who are already gun shy about getting involved with new shows because executives have itchy trigger fingers and they aren't shy about canceling a series.

Believe comes from J.J. Abrams (Lost) and Alfonso Cuaron (Gravity) and centers on a mysterious group charged with protecting a young girl with special powers. Crisis is more celeb-driven with Gillian Anderson (The X Files) and Dermott Mulroney (My Best Friend's Wedding) among its more well-known names. The drama looks at the calculated kidnapping of a group of students at a prestigious D.C. area school and the impact it has on some of their very influential family members. Both are quality series and in any other situation would likely find a following. However it's hard enough to get audiences to commit to one open-ended event-type series, much less two.

The 'Resurrection' effect

Now it's certainly not impossible to break through on a busy night, but this is going to be tough for NBC. While True Detective and Downton Abbey have wrapped for the season, Game of Thrones is just weeks away from debuting, as is Mad Men. In addition The Walking Dead is still going strong and The Good Wife is in the middle of a three-part game-changing storyline. You also have to take into account the shocking success of ABC's Resurrection, which last Sunday bowed to 13.5 million viewers and a 3.8 rating in the coveted 18-49 demo.

Resurrection's success is an outlier in this scenario though as the show was backed by a well-received marketing and PR campaign and was sandwiched between two popular established shows that were coming back after a long break. It was the perfect storm of opportunity and despite huge competition it worked. Those numbers will likely drop in week two, but regardless it was an impressive debut.

Reindeer ratings games

NBC gave Believe a sneak preview airing last Monday with The Voice as its lead-in and drew a solid 10 million viewers. In order to stack the deck, the network will air a Voice special this Sunday prior to Believe that recaps the best of the blind auditions to help ease the transition. Yet if you missed Monday's Believe premiere you need to either tune in Saturday night for the replay or go online and catch it earlier because Sunday's episode is brand new.

Personally, I've never been sold on the "preview" approach because the pilot of a show is so important (especially for a serialized series) and if audiences miss it they may not want to try and jump in with the next episode. NBC loves the preview approach though and did it with a number of top shows last season during the Summer Olympics. Remember though that while all three "sneaked" shows were high profile, none lasted the season.

NBC has had better luck so far with its winter previews of About a Boy and Growing up Fisher, but the network also did an about-face and reran both pilots during the shows' timeslot debuts instead of going with new episodes. The move worked initially as Boy ended up pulling the same ratings in both slots and has been respectable in the weeks since, while Fisher has slipped but continues to win its timeslot in the demo.

Heading into a crowded field Sunday evening, do you believe in Crisis? Will the ratings be a crisis for Believe? Are there enough viewers left over after all those strong competitors to build a Sunday night audience, and if not, will viewers have enough room on their DVRs for these upstarts? And why can't the networks spread out the good shows a little? 

All these questions will begin to be answered Sunday night.

Last year, Game Informer reported that Amazon.com was working on a video game console. Then, in February, TechCrunch said the retailer had acquired Double Helix Games, the developer of Killer Instinct, a launch title for Microsoft's Xbox One.

While Amazon's video game debut could put pressure on the existing console players -- Microsoft, Sony and Nintendo -- the most recent leak doesn't look particularly promising.

Amazon's controller
Leaked images of Amazon's controller (via Zatz) show something not too terribly different from any other video game controller. Two thumb sticks, a circle of buttons, some triggers, and a D-pad complete a design that looks more than capable of playing the latest Call of Duty title.

Amazon uses Fire OS, a modified version of the Android operating system, on its Kindle Fire tablets. It seems logical to assume that it would do the same on its video game console, and if the controller is any indication, it will do just that -- the three center menu buttons on the controller correspond directly to the buttons found on any Android-based phone or tablet.

But overall, the controller design looks horrendous -- an ugly, uncomfortable rip-off of Microsoft's Xbox design. I'm not only gamer to think this -- commentators on NeoGAF, a gaming enthusiast forum known for leaking details on, among other things, Microsoft's Xbox One, came to a similar conclusion.

"Ugly," wrote one poster. "It looks so sad. Someone needs to cheer it up," wrote another. "That looks like it'd be really uncomfortable to use."

Controllers can make or break a system
The importance of a video game console's controller cannot be understated: Microsoft reportedly spent $100 million developing the Xbox One's controller, while the success of Nintendo's last console, the Wii, was predicated almost entirely on the (then) revolutionary Wiimote. The successor to Nintendo's Wii, the Wii U, has largely been a failure at retail, due partially to its expensive, and under-utilized tablet controller.

It's possible that the images of Amazon's controller are of an earlier version, a prototype, and not indicative of the finished product. It's also possible that it feels much better in the hand than it looks. But based on these images, I wouldn't expect Amazon to obliterate the competition.

It looks like Amazon is serious about video gaming
Still, Amazon's move to offer a full-fledged controller, rather than say, a touch-based control scheme using a tablet, suggests that the retailer is serious about competing in the traditional video game market.

Last week, TechCrunch's Natasha Lomas argued that the console market was "in crisis." Lomas' argument involved a certain amount of cherry-picked data (focusing on January's poor sales and ignoring a strong November and December), but sluggish console sales suggest the market is ripe for a shakeup: Nintendo's living room console, the Wii U, has fallen far short of Nintendo's expectations, while Microsoft appears to have overestimated the demand for its Xbox One console.

Given Amazon's extensive cloud assets, and the data it has compiled over the years on its customers' video game preferences, Amazon could eventually emerge as a formidable competitor -- but it might need to redesign its controller first.

Tesla Motors stock fell about 6% this week, faring worse that the S&P 500's decline of about 2%. While there were news-worthy items related to Tesla during the week, the most likely cause of the decline in Tesla's shares is simply that it is a suitable time for a breather after a gain that topped 40% in the past two months, on top of a massive 300% gain in in 2013.

Let's look at the Tesla news that surfaced during the week as well as the stock's valuation, which is raising eyebrows.

Model S. Image source: Tesla Motors.

Tesla gets banned in New Jersey
The most important Tesla news this week came on Tuesday, when the company blogged about New Jersey Gov. Chris Christie's sudden decision to support attempts to ban Tesla's direct sales model in the state.

Later that day Tesla was, indeed, banned from selling cars in the New Jersey. The state approved a regulation that would require all new-car dealers to obtain franchise agreements in order to receive state sales licenses. The Christie administration had previously agreed to delay the proposal and, instead, grant Tesla a fair legislative process to defend its reasoning for a direct sales model in the state. But Christie changed his mind, gave Tesla less than 24 hours' notice, and here we are.

While Tesla does have a broader agenda of defending innovation and consumer choice by pushing the direct sales model over the franchise model, the argument can be simplified even further: Tesla says that selling its eclectic vehicles is (understandably) an education-intensive process. Having its own stores and Tesla retail employees, therefore, allows the company to educate customers, potential buyers, and the rest of the world about electric cars.

Is the sell-off merited?
That depends on your view of the trajectory of electric cars, going forward. But investors looking to buy Tesla at a reasonable price may end up never owning the stock; disruptive companies like Tesla are known to consistently trade at wild valuations as the market prices in a bullish outlook.

To add perspective of just how expensive Tesla stock is, the company trades at a market capitalization of $28.5 billion, half of General Motors' market valuation. This is telling, considering that Tesla only sold about 22,500 vehicles in 2013 and General Motors sold 9.7 million vehicles. To be fair, however, Tesla projects that the company can sell 500,000 annually by 2020. Further, its gross profit margins are putting many automakers to shame.

Wrapping up the week with a fun video, here is a fan-made Tesla Model S commercial making waves.

Excited fans like these college graduates who shot this film play a big role in Tesla's word-of-mouth marketing as the company continues to spend zero dollars on advertising.

Going into next week, keep an eye out for a blog post from Tesla. Tesla CEO Elon Musk tweeted on Friday that he was working on a post this weekend to counteract arguments from journalists who are asserting that the Model S has negative impacts on the environment.

A common mistake that many retail/new investors make is to short richly valued stocks and to buy stocks that trade at a modest multiple. But the best analogy to illustrate why this isn't usually a winning strategy is, well, smartphones. Look at the Apple's  iPhone 5s. With a bill of materials of roughly $199, the cheapest model sells for $649, with $100 increases for each tier of additional NAND flash. Is Apple charging a huge markup? Absolutely. Is that premium worth it? Judging by the sales numbers, apparently so.

In contrast, take a look at something like a Nexus 5. It comes with a top-notch processor, more RAM than the iPhone 5s, a bigger screen, faster cellular/connectivity, and so on -- and it sells for just $349. The bill of materials is likely meaningfully higher than that of the iPhone 5s and yet it doesn't sell for nearly as much and the demand isn't close to as robust. Why are people willing to pay so much more for the iPhone 5s than they are for the Nexus 5?

It's a combination of factors
Anybody following the smartphone sector knows that the iPhone 5s is regarded as one of the highest quality phones on the market today from both a hardware and a software perspective. The Nexus 5 ticks all of the hardware checkboxes, but there are real limitations to a stock Android-based device versus a highly polished, ecosystem-integrated iOS device. There's also the value in the iPhone brand that users simply value more than they do the "Nexus" brand. This argument largely works if you replace "Apple iPhone" with "Samsung Galaxy."

And so is the case with ARM Holdings . Yes, it's trading at 90 times trailing 12 month IFRS earnings (this is like international GAAP), but on a non-IFRS basis (i.e., excluding share-based comp and special charges), the stock is trading at 40x the current year's earnings and 31.8x the consensus 2015 earnings. By all means, this is still richly valued, but think about what investors perceive to be getting for their money with ARM:

• A nearly impenetrable monopoly on CPU IP that goes into mobiles, IoT/embedded, and the beginnings of a strong networking story.
• A potential server growth story (although to be frank, Intel is probably going to defend its share extremely well making this difficult for ARM to realize long term).
• An ongoing content-share gain story in handsets, particularly as ARM continues to offer/refine its physical IP, graphics IP, and so on.
• A transition to ARMv8 (i.e., 64-bit) that should lead to increased royalties per unit in mobiles.

Now, the good news for ARM investors is that these are pretty legitimate reasons to drive a "rich" valuation, particularly given the very long tail and relative security there is to an IP/royalty-based model. The bad news is that if one of these tenets were to be proven false and the revenue growth slowed as a result, then the stock would see a pretty substantial downward repricing.

Does such a catalyst loom?
The only reason to short an individual stock is if you have a fairly near-term catalyst in mind that you want to exploit. For a good long while, the big fear for ARM has been a potential Intel incursion into mobile. Indeed, the decline during 2013 from ~$50 to ~$33 was probably driven largely by the fact that Intel had won the Samsung Galaxy Tab 3, setting the stage for future high-volume ARM socket losses. But as soon as this wasn't actually followed up with a pipeline of Intel-powered Samsung products, the market's sentiment reversed -- again.

If Intel were to show some traction in smartphones and tablets at major players, then this would serve as a fairly negative catalyst for ARM (although to be perfectly fair, ARM's financials would probably take far less of a hit than the sentiment around the stock would). But it would take more than just one marquee design win at this point, and it'd need to be across a variety of partners that have probably never used Intel mobile chips before. Dell doing an Intel-based tablet means something entirely different than Intel winning a line of designs from Samsung.

Foolish bottom line
It's typically a bad idea to short companies with improving fundamentals, so at this time ARM remains a short with a fairly unfavorable risk/reward profile, especially given how reactive it can be to news flow. Until the news turns negative and until ARM starts "missing" quarterly estimates, it will remain a difficult short barring a broad market meltdown. The best shorts are weak companies getting weaker -- not strong companies getting stronger.

Free is tough compete with. Microsoft knows that better than anyone these days. It has been Google's strategy for Android from the beginning -- and it has worked. The Android outcome is well documented: mass adoption of Google's mobile operating system by manufacturers all over the planet. Microsoft initially decided to take a different approach and charge for its Windows Phone operating system. But as Microsoft looks for ways to boost its market share in the important mobile market, it is warming up to the idea of free. In fact, for a few original equipment manufacturers, or OEMs, Microsoft is now making Windows Phone available at no cost.

Google seems to be making all the right moves with Android. The Google operating system boasted 78.1% market share of smartphone shipments in the fourth quarter, according to IDC. Allowing manufacturers to fork versions of Android for their phones without any cost is certainly one of the major drivers behind the onslaught of cheap Android devices. And even if Android doesn't make any money from licensing fees, there are irrefutable benefits for the search giant. Not only does the early adoption of Android by users mean they will have more time to get used to the operating system and have a greater chance of sticking with it for the long haul, but mass adoption also bolsters the value of the platform to third-party developers. And we can't forget Google's master weapon to monetize users: advertising.

But the story for Windows Phone isn't quite as optimistic. While IDC notes that the Windows Phone operating system is growing rapidly -- the growth is on a very small base. The research firm estimates Microsoft's mobile operating system will only capture 7% market share by 2018 -- up only three percentage points from IDCs estimates for Windows Phone's 3.9% share by the end of 2014.

But Microsoft has a plan
The Times of India is reporting that Microsoft is now waiving the Windows Phone license fee for two Indian OEMs, Karbonn and Lava Xolo. The effort is likely a strategic move to defend its growth prospects from getting trampled by Android as a free alternative to Windows Phone in key emerging markets. The two OEMs that only recently were recognized as Windows Phone makers were in talks with Microsoft since last year, but it wasn't until Microsoft nixed the license fee that agreements were made, according to The Times of India. Bolstering the argument that Microsoft is attempting to compete with Android, Indian phone maker Karbonn is now offering a "dual-boot" phone option that allows users to choose between Android and Windows phone, a move that Microsoft has been rumored to be pushing for with HTC.

Microsoft's Windows problems, however, stretch beyond mobile. While Microsoft's Windows Phone is struggling with its position as a minority in a Google and Apple-dominated smartphone environment, its Windows 8 is also struggling with its dwindling market share in PCs. To combat with dwindling dominance in PCs, Microsoft is reportedly cutting the Windows 8.1 licensing costs by a whopping 70% for PC makers, according to Bloomberg. 

For investors, the concern is whether Microsoft's price cuts will result in outsized benefits in market share gains. But trading at just 14 times earnings, the company is arguably already priced for an uncertain outcome for Windows going forward, so there's no reason for investors to alter their investment thesis on the stock yet. Still, Microsoft investors should at least keep a close eye on the challenging Windows environment.

Co-founders Tom and David Gardner look back on The Motley Fool's journey with Amazon.com  since first purchasing it in September 1997. The brothers discuss the ups and downs they've seen with the stock, now a 100-bagger for the Fool.

In this video segment, David shares the experience of purchasing Amazon for $3, watching it go up to $95, then seeing it fall back to $7, only to rise again. His secret? Look at the business, not the stock, to see what's really going on.

A Foolish offer you can't refuse
Not every CEO can be as successful as Jeff Bezos has been with Amazon. But over the past two years, Motley fool co-founder and CEO Tom Gardner has made it his personal mission sit down with dozens of the world's brightest investors and business minds on behalf of his Motley Fool ONE members -- we're talking true American legends like Whole Foods co-CEO John Mackey, Costco founder Jim Sinegal, and even Vanguard founder Jack Bogle -- as he scours the globe to find the next great company to provide Amazon-esque returns.

On March 20, this "crown jewel" service will reopen to new members for only the third time ever. And to celebrate, Tom would like to offer you a front-row seat to watch these visionaries share the keen insights and unparalleled business acumen that got them to where they are in life.

Even if you aren't an investor, the business lessons you'll take from these conversations are priceless. So please click here to access our Motley Fool ONE member lobby and our entire collection of these interviews absolutely free of charge!

Tom Gardner: OK, I just want to put these factors together. I'm really restating what you've said.

If you're looking for the next 100-bagger today, you would be looking in a big trend that has a visionary leader, high sales growth rate, and you have connection to it as a consumer. That's not the only place to find the next 100-bagger, but those four factors would be a useful way. And maybe the fifth is that it's a relatively small company. There are visionary leaders at Google, but it's not going to be a 100-bagger over the next 10 years.

So, it's a smaller company -- let's say market cap sub-$2 billion -- visionary leader, big trend, high sales growth rate, with consumer connection to you. That would be a good way for somebody to look out for it.

David Gardner: That's not a bad template. One thing I want to point out is you've described, in many cases, just what cool businesses are. They have those things. A 100-bagger takes it from the realm of business, into investing and how you, as an investor, achieve a 100-bagger, which is what we've done in Amazon.

That's a little bit of a separate story, right? Because to get a 100-bagger ... Amazon is one of the few stocks that's actually done that, that you could have done in the last 20 years, and it took 16 years. It took watching that stock go from $3 -- our cost -- to $95, and then back to $7, and we held all the way through back to $95, and then $100, $200, $300. It took 16 years of patience in a world that is very myopic.

Tom: Six months is the average holding period.

David: A lot of people sell off in advance of bad ... worried about the next earnings. There's a whole separate story. We don't have to talk about it too much in this conversation ...

Tom: No, I like it actually. Were you worried? When it went from $95 to $7, did you second-guess yourself at any point? You had a 30-bagger as an investment, and you watched it fall.

David: To a two-bagger.

Tom: To a two-bagger. So, you still had the joy of saying, "I've doubled my money," but you watched a 90% decline and obviously, in order for a stock to decline that much, most people have sold. What is it that allowed you to hold that? What are some factors in your approach to portfolio management or individual company investment?

David: Sure, and I'm going to be quick, because we're going to run out of time, but I'll just say for now, it's mostly looking at the business, not the stock. You know that; I know I'm preaching to the choir -- although while Tom and I have kind of got it for about 20 years, I think a lot of the world doesn't think about things that way.

Every time I watch financial television -- which, by the way, I don't, really -- I'm reminded again of how people are thinking too much about stocks; wigs, wags and short-term moves, and they're not really looking at the business. While Amazon's stock dramatically declined over that, the business did not nearly.

And it's not just Amazon, obviously. I'll just throw in another example near and dear to our hearts: Netflix .

Netflix stock dropped from a high in 2011-ish over $300, down to $55 within about 18 months. We held all the way down and we've held all the way back -- but did the business crumble? Even at its worst Qwikster moment, I think they lost about 500,000 subscribers from maybe 24 million to 23.5 million.

If you're looking at the business and you're not seeing any kind of drama there, I think it makes it a lot easier to continue to hold 30-baggers down to two-baggers, back to 100-plus-baggers.

The iPad Pro may have just been shelved, according to Digitimes. For investors closely following the Apple rumor mill, this may come as quite a surprise. Up until now, speculation pointed to an eventual launch of a larger iPad. But should investors be surprised? After all, Apple is known for unashamedly shelving product plans at the last minute. Even more, does Apple rumor speculation really help investors?

A MacRumors mockup of a 12.9-inch iPad next to a 13-inch Macbook Air. Photo used with permission.

Apple's secrecy makes speculation almost impossible
When Apple CEO Tim Cook said in 2012 that it was "going to double down on secrecy on products," he apparently wasn't kidding. Despite Cook's assertion that Apple is working on "new categories," and the fact that the company's massive supply chain sprawls the globe, it has been very difficult for the ever-active Apple rumor mill to pinpoint exactly what Apple is working on this year. And now with Apple reportedly shelving plans, it's a wonder if investors can make any accurate predictions of Apple's product plans.

In one example of just how difficult it is this year to predict Apple's product plans, analysts still remain undecided on the purpose of Apple's contract with GT Advanced Technologies to produce enough sapphire crystal for up to an estimated 25 million smartphone covers a quarter.

Is Apple's secrecy and unpredictability calling into question the entire relevancy of the Apple rumor mill for Apple investors?

The impact on Apple's business is hard to estimate
Even if we could be sure Apple was launching an iPad Pro, it would be very difficult for investors to predict the impact it could have on its business. Generating $174 billion of revenue in the trailing 12 months, new products would have to both be a blockbuster success not over cannibalization Apple's other product lines to meaningfully budge Apple's bottom line.

Fortunately, investors who own Apple stock today don't need to predict Apple's product launch plans to justify holding on to the stock. Trading at just 13 times earnings with a the world's largest share repurchase program in effect, any major success of a new product would likely be a bonus for the company. Further, given Apple's incredible customer retention along with Apple's proven track record of successful new products, Apple's user base likely won't be going anywhere.

So will we ever see an iPad Pro? It's tough to say. But does it really matter whether we can accurately predict Apple's product plans or not?

Traditional IRAs can be a great way to get a last-minute tax deduction, but high-income taxpayers often aren't entitled to deduct IRA contributions. If that's the case, does it still make sense to contribute at all?

In the following video, Dan Caplinger, The Motley Fool's director of investment planning, looks at nondeductible IRAs and whether they make sense. Dan notes that if you can use the backdoor Roth IRA strategy to convert a nondeductible traditional IRA to a Roth without paying tax, then it definitely makes sense to consider nondeductible IRAs. But for others, the big problem with the nondeductible IRA is all distributions in retirement are taxed at ordinary rates, whereas even a normal taxable account gets preferential rates for dividends and long-term capital gains. Dan concludes that in general, you'll do better in a taxable account than using a nondeductible IRA if you can't convert it to a Roth without huge tax hassles.

Seth Goldman and Barry Nalebuff founded Honest Tea in 1998. In the recently released  Mission in a Bottle , the co-founders tell -- in comic book form -- the story of building a successful mission-driven business. Goldman, now president and "TeaEO" of Honest Tea, joins Motley Fool CEO Tom Gardner to discuss sustainability, entrepreneurship, and what it means for a socially responsible, health-oriented business to be bought by Coca-Cola  .

In this video segment, Goldman recalls the "surreal experience" of a 2001 scandal when a consumer made an unsettling find in a bottle of Ora Potency Punch, produced at the bottling plant owned by Honest Tea.

A full transcript follows the video.

Tom Gardner: You mentioned the difficulty of raising money in 2001. Then in October of 2001 you got a phone call, or a connection with the Denver police. I just want to say, I believe we have an adult audience here this evening, so feel free to give the NC-17 version of the story.

Seth Goldman: In the big picture, we have some real fun cameos. There's a cameo by President Obama. There's a cameo by Oprah. The one I wouldn't have wished for was a cameo by Howard Stern.

What happened was, a guy went into a Denver 7-Eleven and he bought a product that was made at the bottling plant we own. The product wasn't Honest Tea, thankfully. It was called Ora's Potency Punch.

His Potency Punch was a little too potent. He thought there was a male organ in the bottle. There were pictures of it.

When I got the call from the plant manager, he said, "Are you sitting down?"

I said, "Yes. What's going on?"

He said, "Well, I've just got to tell you. There's this male surprise in a bottle."

I said, "Oh, my gosh. How did ... what ...?" I said, "Well, I better tell Denise" -- the other owner of the plant -- so I called her. I said, "Denise, I hope you're sitting down."

She said, "Oh, yeah, what's the matter?"

I said, "This guy bought a bottle of Ora Potency Punch at the 7-Eleven and it's too potent, and he thinks there's a male organ."

She goes, "What?" and she just drops the phone.

As she's doing this, the computer tech is in her office and he says, "Lady, is everything OK?"

She said, "You'll never believe this, but we have this bottling plant, and this guy went into a 7-Eleven ..."

He said, "Oh, yeah, and he found the male organ inside?"

She said, "How do you know?"

He said, "I heard it on Howard Stern on the way over."

Howard Stern was talking about it because the "segment" was only two inches long and Howard's like, "No one's going to confess that it's theirs!"

It turned out it was mold that took on that shape. That was one of those surreal experiences that you just cannot make up.

IRAs can be great ways to save for retirement, but in order to qualify for them, you need to have earned income. But what is earned income, and how can you make sure you have enough of it to qualify to use an IRA?

In the following video, Dan Caplinger, The Motley Fool's director of investment planning, explains the concept of earned income. Dan notes because IRAs are designed to encourage work, lawmakers wanted to require income from a job in order to use an IRA. But earned income goes beyond simple salaries and wages, including not only tips but also other types of income like self-employment income, long-term disability payments, and union strike benefits. Yet Dan also lists some types of income that aren't earned income, including investment income, unemployment, and Social Security benefits. Although these restrictions keep some people from using IRAs, they're relatively flexible in allowing most people who get their income from their own work to use IRAs.

Although the rate of growth in the amount we spend on our pets is slowing, the continuing trend toward their humanization ensures that companies catering to those whims will prosper. Food companies in particular should be rewarded, because, like us, pets need to eat, and one of the last things we're likely to get rid of if our own financial situation turns south is our furry companions.

Source: Blue Buffalo.

Premium pet-food maker Blue Buffalo seems to understand that trend and is rumored to be readying an IPO for later this year. Last October, privately held Del Monte Foods, arguably best known for its pineapples, sold off its fruit business for $1.68 billion, choosing instead to focus solely on pet food products. It's not widely known, but with such well-known brands as Meow Mix, Kibbles 'n Bits, and Milk-Bone, Del Monte is the fourth largest producer of pet products. It also recently acquired Natural Balance pet food and took a minority equity interest in a pet products co-packer.

According to the American Pet Products Association, more than-two thirds of U.S. households own a pet, with dogs remaining the top choice at 56.7% and cats coming in second at 45.3% (fish are a distant third at just over 14%). Although overall spending is expected to reach $55.5 billion in 2013, the 4.1% increase from the year before is down slightly from the rate of increase in 2012 and has been on a steady decline for years.

Source: American Pet Food Association.

Pet food, however, has remained fairly stable, accounting for more than 38% of the total money spent on pets, more than any other category. Veterinary care at 25% is second.

Leading pet-supplies store PetSmart  saw its stock slump earlier this year after an analyst slapped a "sell" rating on it over fears of increased e-commerce competition, but the stock has regained almost all of the lost ground if for no other reason than because as we humanize our pets they become not just animals, but "pet babies" (making their owners, naturally, "pet parents") and ensuring that expansion will continue.

PETM Total Return Price data by YCharts

One of PetSmart's main focuses has been and will continue to be pet food, and in its earnings conference call earlier this month it laid out how it's partnering with pet food makers to cook up exclusive items that its customers -- er, pet parents -- won't find at Petco or on Amazon.com's Wag.com. 

PetSmart and other retailers are really brand agnostic. willing to carry Blue Buffalo, Nestle's Purina One Beyond, or Colgate-Palmolive's Hill's brand. And because "parents" are increasingly concerned about what their "babies" are eating, just as we see with the human food chain, the super-premium food category remains a driving force behind the sector's growth and is why PetSmart's continues to dedicate more aisle space to the niche.

Sales at Blue Buffalo are expected to exceed $600 million this year, and some estimates suggest they could go as high as $800 million, causing analysts to peg a possible IPO valuation somewhere between $1.2 billion and $1.6 billion, or around two times sales. That's not unreasonable, since Del Monte paid between one and one and a half times revenues when it bought Natural Balance.

But like the overall industry, the premium food category's rate of growth is slowing too, though with it still in the mid- to high teen range there's no real shortage of demand just yet. Further, "showrooming" isn't limited only to consumer electronics superstores. When an Amazon Prime member can have the same 30-pound bag of Blue Buffalo food delivered to his door for free by UPS and not have to hump it around himself, why would he go to the grocery store or pet food store anymore to buy one?

While the IPO route is said to be Blue Buffalo's main focus at the moment, the possibility of a buyout remains in play. Nestle was said to have looked into making a bid for it and Del Monte certainly has the wherewithal to do another deal, too. Yet with Colgate still recovering credibility for its Hill's brand after having to excise the word "science" in its name, and Procter & Gamble  still reeling from a massive recall of all its pet food products last year, it may be why Blue Buffalo is choosing the public offering route.

Whichever road the super premium pet-food maker does take it's clear this is not a case of the tail wagging the dog, but one of real opportunity, and but should it eventually IPO, investors may want to put on a leash and bring Blue Buffalo to heel.

Source: Flickr, thetaxhaven; Warren Buffett picks stocks - and ukuleles - better than most.

Warren Buffett may be the best investor - ever. But while Berkshire Hathaway shareholders have been handsomely rewarded over the past 49 years, the Oracle of Omaha has different strategy for his own will. Here's what you need to know.

Don't buy Berkshire Hathaway?
Since Buffett Partnership Ltd. acquired Berkshire in 1965, business has been booming. In 48 full financial years, Warren Buffett has delivered positive annual earnings for all but two years. Shares soared as much as 59.3% in a single year (1976), but more importantly, Buffett has consistently beat his benchmark.

From 1965 to 2013, Berkshire Hathaway's compounded annual gain comes to 19.7%, compared with just 9.8% for the S&P 500 - and that includes Fortune 500 dividend payouts. In the past 20 years, Berkshire Hathaway shares have soared more than 1,000%, more than twice the S&P's returns.

BRK.A data by YCharts

But despite ridiculous returns, Buffett isn't trusting Berkshire Hathaway with one cent of his estate. When he bids his final farewell, the Oracle of Omaha has different plans for his portfolio.

Keep it simple, stupid
Warren Buffett's latest Berkshire Hathaway letter to shareholders spells out his post-mortem plans, plain and simple:

What I advise here is essentially identical to certain instructions I've laid out in my will. One bequest provides that cash will be delivered to a trustee for my wife's benefit. (I have to use cash for individual bequests, because all of my Berkshire shares will be fully distributed to certain philanthropic organizations over the ten years following the closing of my estate.) My advice to the trustee could not be more simple: Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund. (I suggest Vanguard's.) I believe the trust's long-term results from this policy will be superior to those attained by most investors -- whether pension funds, institutions or individuals -- who employ high-fee managers.

While Buffett undoubtedly wishes Berkshire Hathaway all the best, he's keeping investing easy for his wife -- and his advice is excellent.

We all want to be good investors. Heck, we all want to be outstanding investors. But the truth is, many "market masterminds" consistently underperform Mr. Market.

According to Standard & Poor's, 84% of U.S. stock fund managers failed to match the S&P 500's 2.1% returns in 2011. A study by Vanguard Group found that, over a longer 20-year period, 72% of managed funds underperformed their respective benchmarks. In the past five years, hedge funds' collective $2.5 trillion portfolio has underperformed the simplest S&P 500 index fund.

Analyst ratings didn't help, either. According to Bloomberg, the 50 worst-rated stocks in 2012 soared 23% -- outperforming the market by 7 percentage points.

Big Oil needs to stop complaining about all the money they spend on exploration and development, because a large part of it is their fault. The entire industry spends billions on individual projects with unique designs that cannot be replicated at other projects, and they all try to take on huge projects all at once. Yet there is one investment Royal Dutch Shell has made that might help alleviate this problem: floating LNG liquefaction facilities. 

By eschewing the traditional method of developing an LNG terminal on land, Shell has potentially opened the door to save the industry billions through standardized designs, smaller-scale projects implemented in stages, and mobility. Find out how Floating LNG makes these elements possible and why other big players like Chevron and Total should follow Shell's lead on these types of projects.

Want to boost your retirement savings and lower your taxes? A Roth IRA is a way for investors to do just that. But tax-free growth potential and tax-free withdrawals are just two benefits of a Roth. Here are three lesser-known advantages.

1. Use your contribution dollars at any time
We typically focus on the saving and investing aspects of Roth IRAs. But a Roth IRA enables you to take out 100% of what you've contributed at any time and for any reason, with no taxes or penalties. Only earnings in the Roth IRA are subject to restrictions on withdrawals. A distribution of earnings from a Roth IRA is tax-free and penalty-free if the account has been owned for five years and at least one qualifying condition is met. However, distributions of earnings are taxable if one of these conditions is not met and the five-year holding requirement hasn't been satisfied.

2. No required minimum distributions
Unlike Traditional IRAs and employer-sponsored retirement plans, Roth IRAs do not impose required minimum distributions, or RMDs, during the lifetime of the original owner. If you don't need your RMDs for essential expenses, they can be a nuisance. RMDs must be calculated each year and result in taxable income. Also, if you miss taking one, you'll incur a hefty penalty. Owning a Roth IRA gives you piece of mind knowing you don't have to deal with RMDs.

3. Leave tax-free money to heirs
Because Roth IRAs don't require RMDs during your lifetime, these accounts could potentially grow larger over the years and be passed on to your heirs. But carefully consider the pros and cons before trying to use a Roth IRA for your estate planning. For example, if you plan to leave your retirement savings to your heirs, consider how it may affect their taxes. RMDs from inherited Traditional IRAs generate taxable income for heirs and could push them into a higher tax bracket. If your heirs' income tax rates are expected to be lower than yours, they may be better off inheriting a Traditional IRA rather than a Roth IRA. Also, note that while RMDs are required for inherited Roth IRAs, those distributions generally remain tax-free. Be sure to consult an estate planning attorney before attempting to use Roth IRAs as part of an estate plan.

Foolish takeaway
Do these lesser-known reasons for owning a Roth IRA entice you? If so, you have until the April 15 deadline to contribute $5,500 (or $6,500 if age 50 or older) to a Roth IRA for 2013. Not everyone can contribute to a Roth IRA because of income limits.  But you still may be able to convert an existing Traditional IRA or other retirement savings account into a Roth.