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Wall Street This Week: Spain Mobilizes; Staples Steps Up

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Spain Wireless Show
Manu Fernandez/APVisitors at the Mobile World Congress trade show in Barcelona, Spain, February 2014
From the resurgence of a trendy smartphone accessory-maker to challenges for a once-thriving teen apparel retailer, here are some of the things that will help shape the week that lies ahead on Wall Street.

Monday -- Phoning It In

The Mobile World Congress kicks off in Barcelona on Monday. The weeklong event will give smartphone-makers as well as the technology companies and wireless carriers that rely on mobile a chance to show off their latest developments.

More than 85,000 people attended last year's conference, checking out dozens of presentations and hundreds of exhibitors. Some companies like to make big announcements during the annual show, so expect a lot of headlines out of the mobile market.

Tuesday -- Under my Ambarella

Ambarella (AMBA) reports Tuesday. The maker of chips for HD cameras may not be a household name, but its semiconductor solutions can be found in popular camera-based products including GoPro (GPRO) wearables and Dropcam surveillance equipment.

There's plenty of growth to be had in Ambarella as a coattails-rider. With the booming popularity of GoPro wearable cameras and Dropcam monitors, it's easy to see why analysts are holding out for a 48 percent pop in revenue for the quarter and profitability nearly doubling.

Wednesday -- Abercrombie & Flinch

Not every retailer is thriving in this improving economy. Abercrombie & Fitch (ANF) reports Wednesday, and it's been making waves for all of the wrong reasons. Things heated up at the U.S. Supreme Court last week over an employee discrimination case brought against the teen retailer by a Muslim woman who was rejected for a job, claiming that she didn't get the gig because she wore a hijab headscarf to the interview.

Also late last week we saw Morgan Stanley (MS) downgrade the stock, slashing its price target to $18 from $28. Abercrombie stock has already surrendered nearly half of its value since its summertime peak, and the downgrade so close to its earnings report is another ominous sign.

Thursday -- Skull Cap

Skullcandy (SKUL) hopes to make sweet sounds Thursday. The edgy maker of in-ear headphones has been a rough investment for shareholders who bought into the company when it went public at $20 four summers ago. The stock has gone on to shed nearly half of its value, but it has started to bounce back lately.

Analysts see strong double-digit growth in sales and earnings when Skullcandy reports Thursday afternoon.

Friday -- It's Hard to Find the 'Easy' Button

Staples (SPLS) closes out the trading week with fresh financials on Friday morning. It's hard to be an office supply superstore chain these days. Staples has struggled with its European stores, and is facing competitive pressures from online retailers closer to home.

It sees a near-term solution in acquiring its biggest rival, recently announcing plans to snap up Office Depot (ODP) in a deal valued at more than $6 billion. The combination would find Office Depot, OfficeMax, and Staples owned by the same company, and that's not a slam dunk to clear regulatory antitrust hurdles. We should get an update on the situation during Staples' conference call.

Motley Fool contributor Rick Munarriz owns shares of Ambarella. The Motley Fool recommends Ambarella. The Motley Fool owns shares of Ambarella and Staples. Try any of our Foolish newsletter services free for 30 days. Is your portfolio ready for what 2015 has to offer? Check out our free report for one great stock to buy for this year and beyond.

 

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The Simple Email Trick That Could Protect Your Identity

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By Adam Levin

"Having two identities for yourself is an example of a lack of integrity," Mark Zuckerberg proclaimed in "The Facebook Effect." Easy for him to say. Facebook (FB) has made a mint on data integrity- -- our personal information yoked to likes and dislikes sold to the highest bidder. But here's some bad news for Zuck: When it comes to navigating a world filled with identity thieves, it pays to lack data integrity.

There are more than a billion records containing some form of personally identifiable information already "out there" in the wake of the mega data breaches suffered by JPMorgan Chase (JPM), Target (TGT), Home Depot (HD) and others. You should assume that your information may already be in harm's way.

There are things you can do to prepare for the inevitability of identity theft -- often for a fee -- and it's a good idea to avail yourself of trusted services and features out there because they can help. Among them credit monitoring services, which can alert you to changes to your credit reports and tip you off to identity fraud, or transactional monitoring services offered by banks, credit unions, credit card issuers and certain third-party venders that notify you every time any activity occurs in your accounts. You can also get your credit scores for free every month on Credit.com. Any sudden, unexpected change in your score could signal new-account fraud. While you're doing that, bear in mind there are other no-fee tricks that can make you harder to hit.

Change the Way You Use Email

I've already written about the value of lying. Making up fake answers to those authentication security questions is a way to foil would-be identity thieves-a painful lesson learned when hackers grabbed celebrity nude photos from Apple's (AAPL) iCloud service last year. The wide use of Twitter (TWTR), Facebook, Instagram and other social networking sites makes everyone a celebrity -- at least when it comes to the "gettability" of personal factoids like mother's maiden name, place of birth, etc.

There is another simple trick in this tradition that could put yet one more moat between you and the evil-doers of the digital realm: Change the way you use email.

It may sound ridiculous at first, but a strategic deployment of the most common and visible form of personally identifiable information-the humble email address-might be enough to send a would-be identity thief packing to an easier mark.

If you're surprised to hear that email counts as personally identifiable information, it might be helpful to review what other kinds of information identity thieves can use to scam you. The National Institute of Standards and Technology provides a comprehensive list that includes: first and last name (with or without middle initial), home address, email address, driver's license number, credit card numbers, any nationally recognized identification number (think SSN and passport), vehicle registration plate numbers and discrete items like date of birth, birthplace, telephone number, login name, screen name, nickname and user handles.

The Secret Email Address

While financial institutions generally don't allow emails to double for user names, and are also more likely to implement multiple-factor authentication, they have no problem with John Q. Public choosing "johnqpublic" as a user name, and since it's not terribly difficult to figure out what Mr. Public's email address is, he's vulnerable. Identity thieves like to play Sherlock Holmes. It's all about deduction and clever guesses-often with the aid of a computer program. This matters because taking over an email account is the fastest way to control other accounts-including financial ones.

One of the easiest ways to address this cyber situation is to create a secret email address that you only use for logging in to your most sensitive financial accounts.

The same kind of "data integrity" that major data miners like Facebook market to this or that company is available on the cybercrime black market. Identity thieves also rely on data integrity. They buy your information in bulk to catch-as-catch-can on the high seas of identity-related financial fraud, and if you've been lying in answer to security questions and creating secret email addresses the chances are reasonable that you've made their job sufficiently difficult that they will move on to another bundle of personally identifiable information that is easier to exploit. This is the reason you should set up an email address used only for your most sensitive accounts. By doing this, you will undermine the integrity of your data where it matters most.

Change Those Passwords, Too

While you are changing those account credentials, take some time to change your passwords, too. As ever, it's crucial to have good data hygiene here. A messy approach to your personal security could cost you big time-maybe not in actual dollars and cents, but for sure in the opportunity cost of hours spent getting your life back. Use different passwords for each account, and make sure your passwords are complex: at least 10 characters long with numbers as well as other symbols and a combination of lower- and uppercase letters.

There is no sure-fire way to avoid identity theft, but you can make yourself harder to hit, and creating a separate email account for your most sensitive online activity is a good foil.

 

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You Should Get to Know These Stock Market Royals

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America may have thrown off a king as head of state hundreds of years ago, yet royalty continues to not only survive but thrive on our stock exchanges. A small, very select group of companies known as the Dividend Aristocrats have pumped out comparatively rich gains for decades. Here's a primer on this rarefied club.

From Stock Exchange to Palace

Unlike the traditional nobility, a stock can find its way into Dividend Aristocrat status if it works hard enough -- and pays its dues.

To enter the club, a company must pay a dividend and raise that distribution at least once per year for a minimum of 25 years in a row.

That's a tall order. To pay a dividend, a company typically has to be profitable, or at least bring in enough cash that it can spare for a shareholder payout. That's challenging enough to do for a year or several consecutively; it's immensely difficult to not only achieve this for a quarter-century, but also increase that payout at least annually.

Many of most celebrated names in American business haven't managed to achieve this. Apple (AAPL), to name one, only relaunched its dividend in 2012, after a nearly 20-year hiatus. This, even though it recently achieved the highest quarterly net profit of any publicly traded company in history.

A Most Exclusive List

Out of the thousands of stocks listed across the various exchanges in this country, barely over 100 qualify as Dividend Aristocrats. They're a mixed bunch. They range from the world-famous -- Coca-Cola (KO) and its eternal rival PepsiCo (PEP), Walmart (WMT) -- to the obscure -- Old Republic International (ORI), anyone? How about Community Trust Bancorp (CTBI)?

Numerous Aristocrats have been increasing their dividends for longer than many of us have been alive. Diebold (DBD) has spent the longest time on the list, having increased its dividend for a hard-to-believe 61 years. Post-it Notes maker 3M (MMM) isn't too far behind, at 56.

Some Are More Equal Than Others

A stock that habitually raises its dividend for years is typically going to boast a higher return (share price appreciation plus dividends) than one that isn't as generous.

At the moment, 53 Aristocrats are part of the benchmark S&P 500 index. On their own, the 53 have posted a return north of 10 percent over the last 10 years. That's well above the broader S&P 500, which has rung up a gain of less than 8 percent.

Even with the dividends stripped out, the Aristocrats beat the S&P 500 on stock price appreciation alone, garnering gains of over 7 percent versus a bit more than 5 percent across those same 10 years.
But investors need to be aware that, just like the upper nobility in the olden days, not all aristocrats are created equal.

Some are quite generous with their payouts, but there are numerous misers.

Some are quite generous with their payouts: AT&T (T), for example, has a dividend yield (annualized payout divided by current share price) well in excess of 5 percent, as does specialist real estate investment trust HCP (HCP). These are far above the average dividend yield of the S&P 500, which is currently 1.9 percent.

But there are numerous misers on the list. Hormel Foods (HRL) is the purveyor of famous (or infamous, depending on your point of view) food products such as Spam and Skippy peanut butter. But its current 25-cent quarterly disbursement per share only yields 1.8 percent.

Americans love getting drunk on Jack Daniel's whiskey, but the brand's corporate owner Brown-Forman (BF-B) pays a dividend that isn't so intoxicating. Its nearly 32-cent-per-share quarterly distribution pours out to a mere 1.4 percent.

And membership in the aristocracy doesn't automatically ensure strong fundamental performance. McDonald's (MCD), for example, has recently been struggling with declining sales and profitability, as well as adjusting to a leadership change after its CEO exited less than three years into his tenure.

Do Some Due Diligence

No group of stocks, even those with good pedigrees and strong bloodlines, is composed entirely of guaranteed winners. Investors should always do their research on companies they're considering, making sure that the selected candidates meet their highest standards. Dividend Aristocrat status alone isn't sufficient justification for buying a stock.

But with its long history of putting money in shareholders' pockets, this noble group is certainly a fine place to start looking for solid investments. More than a few of them have produced, and should continue to produce, er, royal returns for their investors.

Motley Fool contributor Eric Volkman has no position in any stocks mentioned. The Motley Fool recommends 3M, Apple, Coca-Cola, McDonald's and PepsiCo. The Motley Fool owns shares of Apple and PepsiCo and has the following options: long January 2016 $37 calls on Coca-Cola and short January 2016 $37 puts on Coca-Cola. Try any of our Foolish newsletter services free for 30 days. To read about our favorite high-yielding dividend stocks for any investor, check out our free report.​

 

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Spousal IRA Lets Nonworking Spouse Save for Retirement

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When couples have children, they have to make some tough decisions. One of the most difficult is determining if one of the spouses will quit working and stay home with the children. Although more and more fathers are the ones staying home with the children, more often than not women fill that role.

As a financial adviser, I often speak with women who used to make good incomes while making retirement contributions to their employer's 401(k) or 403(b). Years later, after having children, they find themselves un-empowered financially while their husbands are the sole breadwinners. Their retirement accounts haven't grown much because they haven't been contributing to them since they stopped working.

The Spousal IRA is Underutilized

Investing for retirement on two incomes is hard enough, so most couples don't even consider an easy way to boost the couple's retirement assets when only one spouse works. It's called the Spousal individual retirement account, and most people are not even aware it exists.

A spousal IRA allows a working spouse to contribute to a nonworking spouse's retirement savings. Spousal IRAs can be either traditional or Roth and have the same annual contribution limits, income limits and catch-up contribution provisions as those do.

The couple must file a joint tax return. Total contributions for both the working and nonworking spouse cannot exceed $11,000 in 2015, if you are both under 50. If you are both 50 or over, then the maximum amount is $13,000. The working spouse must have sufficient earned income to fund both IRAs. If you haven't made your IRA contribution(s) for 2014, you have until April 15, 2015, to do so.

A Spousal IRA Empowers Women

The spousal account is held in the name of the nonworking spouse only, which allows him or her to choose a brokerage firm, make investment decisions and designate beneficiaries without requiring the signature (or consent) of the other spouse. If a nonworking spouse died during the marriage, the IRA funds would in most cases go directly to the beneficiaries, which may or may not include the spouse. IRA assets during divorce may be considered separate or community property, depending on the state and whether or not the couple has a pre- or post-nuptial agreement.

While I encourage couples to make investment decisions together, I also encourage women, in particular, to take charge and sole responsibility of a small account of their own so they can obtain valuable investing experience.

Although many financial advisers recommend the Roth IRA over the traditional IRA, in many cases I prefer the traditional, especially for couples who are in a high-tax bracket. Motley Fool contributor Dan Caplinger has three reasons why a Roth IRA might be less advantageous.

Spousal IRA owners who choose the traditional IRA face tests to determine how much of the contribution is deductible. The entire amount contributed to the spousal IRA is deductible if the working spouse's employer does not offer a workplace retirement plan. These days a lot of companies hire contract workers or require employees to work for up to a year before they are eligible to participate in the company's retirement plan.

If a spouse stays home with the kids for 10 years and contributes $5,500 per year into an IRA, depending on the investment mix and average annual return, it is possible that the account will be worth between $60,000 and 90,000 as the money compounds without money to pay taxes being extracted. That's the beauty of the IRA -- your money compounds either tax-deferred or tax-free.

Even if you don't have young children, if you are unemployed, you might benefit from the spousal IRA.

The information contained herein is strictly for educational and illustrative purposes, providing commentary, analysis, opinions and recommendations, and should not be considered investment advice for any specific subscriber or portfolio or an offer to sell or a solicitation to buy any security

 

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How to Keep Your Online Tax Returns Safe From Thieves

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By Molly McCluskey

After several states suspended e-filing through the popular online tax preparer, TurboTax itself temporarily pulled the plug on its state tax return e-filing services due to security concerns. The company, owned by Intuit (INTU), which also owns QuickBooks, Mint, Quicken and other personal finance and small business accounting products, resumed all regular services the following day. (Disclosure: The author owns a small amount of stock in Intuit.)

Julie Miller, a spokeswoman for Intuit, says TurboTax has enhanced security measures, which includes multistep authentication, similar to the protections used by banks and financial institutions. All state tax departments have resumed accepting returns filed through TurboTax, she says.

Although the interruption sent shock waves through the industry, as many suspected a cyber breach, TurboTax later said that the company's system had not been compromised. Instead, scammers had stolen personally identifiable information elsewhere and used it to file fraudulent returns. "We want to assure our customers and taxpayers generally that TurboTax is safe and secure, and we've taken every necessary and appropriate action to safeguard customers' information," Miller says.

Despite the assurances, TurboTax's troubles confirmed what fraud experts had been saying for years, that filers should be aware that tax returns are prime ground for hucksters and thieves.

Ease of Filing = Ease of Theft

For many Americans, late winter and early spring are just the beginning of the tax preparation process of receiving 1099 and W-2s, gathering receipts, contacting accountants or choosing an online tax preparer. But identity theft expert Steve Weisman, author of "Identity Theft Alert: 10 Rules You Must Follow to Protect Yourself from America's #1 Crime" and "50 Ways to Protect Your Identity in the Digital Age," says many tax identity thieves act on the first day of filing on Jan. 20, when taxpayers are most vulnerable.

"We know the issue: that anyone can steal a Social Security number, file electronically, and all the things that are being done by the IRS and Congress to make things easy for taxpayers are making it even easier for the fraudsters," Weisman says.

And it's not just the IRS and Congress. Many companies strive to ease the burden of filing, and that convenience can come with a price. Taxpayers who file their taxes via mobile, tablets and apps, sometimes on shared wireless networks, need to be especially diligent about their security.

"One of the primary factors of tax identity theft and fraud is that you can e-file behind a computer screen, which is really convenient if you're going to do something illegal," says Matt Davis, a spokesman for the Identity Theft Resource Center. "If you're a victim of tax identity theft, you're most likely going to be a victim of the other kinds."

Preventing Tax-Related Identity Theft

Both Weisman and Davis say that, aside from protecting personal information and Social Security numbers year-round, the single most important step in preventing tax-related identity theft is to file a tax return as early as possible.

"The IRS doesn't independently verify tax returns. They only know there's a problem once they've received a second return under the same Social Security number," Davis says. "If you're the first one in the door, you're going to have your taxes filed correctly. "

Weisman says that once a fraudulent tax return is filed, gaining access to an ill-gotten refund is fairly easy. "Identity thieves are able to file electronically, the refunds are sent either to a bank electronically or via a prepaid debit or credit card, or sent the old way with a check, which can then be fraudulently cashed," he says. In addition to filing early, the Federal Trade Commission offers these tips to prevent identity theft:
  • Use a secure Internet connection if you file electronically, or mail your tax return directly from the post office.
  • Shred copies of your tax return, drafts or calculation sheets you no longer need.
  • Respond to all mail from the IRS as soon as possible.
  • Don't give out your Social Security number unless necessary.
  • Research a tax preparer thoroughly before you hand over personal information.
  • Check your credit report at least once a year for free at annualcreditreport.com to make sure no other accounts have been opened in your name.
And this important reminder: The IRS never contacts taxpayers by email, text or social media, only via regular mail. Any other forms of contact are fraudulent and should be reported.

If Your Information Has Been Compromised

Once a Social Security number has been compromised for tax fraud, it's extremely likely that it will be used for other types of fraud, including credit card and medical. People who have been victims of tax identity theft should take a sweeping response to the theft by notifying their banks, credit card companies, credit reporting agencies and the proper local and federal authorities. Weisman recommends voluntarily freezing credit reports to prevent new, fraudulent accounts from being opened with a stolen Social Security number. Such freezes can be easily removed and replaced for legitimate purposes.

"If you've been a victim of tax fraud, you need to check your credit reports. It's also a good idea to get a pre-emptive police report, and put alerts on all your accounts," Davis says. "Notifying law enforcement at the outset goes a long way to establishing your credibility with anyone you're going to have dispute the fallout of the fraud with."

The good news is there is no shortage of helpful information for tax filers. The FTC offers tips for preventing tax identity theft on its website, as does Weisman's blog, Scamicide.

Taxpayers who suspect they've been victims of identity fraud should call the IRS Identity Theft Protection Specialized Unit at 800-908-4490 with a copy of a police report, the completed IRS affidavit (Form 14039) and state-issued identification. More information can be found in the Taxpayer Guide to Identity Theft on the IRS website.

 

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7 Clues That Your 401(k) Plan Sucks

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The Supreme Court recently heard arguments in a case about 401(k) retirement plans. Tibble v. Edison International raises questions about an employer's duty to offer low-cost options in a 401(k). While the decision in the case is several months away, it brings into focus an important issue for those saving for retirement.

To help employees assess their workplace retirement plan, here are seven signs that your 401(k) is less than stellar:

1. No Employer Match

The best 401(k) plans offer matching contributions. Paid by the employer, these contributions match a portion of the money employees contribute to their 401(k). For those plans that offer an employer match, a typical program matches 50 cents of every dollar contributed by the employee, up to a maximum of 6 percent of the employee's compensation.

2. No Roth 401(k)

While extensive media coverage has popularized the Roth individual retirement account, some employers also offer a Roth 401(k). While the two are similar, there are some key differences. A Roth 401(k)'s maximum contribution is the same as a regular 401(k) ($18,000 in 2015), which is much higher than a Roth IRA contribution limit ($5,500 in 2015). In addition, your income can't disqualify you from a Roth 401(k) as it can from a Roth IRA.

One benefit of a Roth 401(k) is that it enables employees to save more toward retirement. While the contribution limit is the same as a regular 401(k), the Roth account grows tax free. As a result, you won't have to share some of your retirement account with the IRS when you retire.

3. No Index Fund Options

The lack of index fund investment options is a clear sign that a 401(k) is second rate. Passive investing with index funds beat most actively managed funds over the long term, according to this Vanguard study. Index funds generally are less expensive than actively managed funds. Further, picking actively managed funds requires significant analysis that most individual investors would rather avoid.

4. Expensive Index Fund Options

While index funds are generally an inexpensive way to invest, there are some exceptions. One ought not assume that all index funds are sound investment options. Rydex, for example, offers an S&P 500 (^GPSC) index fund that charges 1.57 percent of assets under management. These fees rival many actively managed funds and are a far cry from the 0.20 percent or less fees found with many similar index funds.

5. Expensive Target Date Retirement Funds

Target date retirement funds are an easy way to invest. TDR funds create an asset allocation plan based on your the anticipated retirement date and adjust the allocation as you near retirement. Vanguard offers several low-cost TDR fund options. Not all mutual fund companies, however, offer low-cost options. In fact, some 401(k) plans use target date funds with hefty fees. While low-cost funds can have expense ratios of about 20 basis points or less, more expensive options can cost 100 basis points or more.

6. Expensive Actively Managed Fund

While index funds should be a part of every 401(k) plan, there is still a place for well-managed, low-cost actively managed funds. Unfortunately, many retirement plans are saddled with funds that cost a small fortune. As a general rule of thumb, look for actively managed funds that cost less than 100 basis points. The best actively managed funds, in my opinion, have expense ratios in the 60 to 70 basis point range.

7. Administrative Fees

Last but not least, a 401(k) that charges its participants an administrative fee is a clear sign employees are getting a raw deal. This is typically the result of an employer unwilling to foot the bill for its own retirement plan. These are best avoided if possible, particularly given that there are plenty of great IRA options that don't charge comparable fees.

If your 401(k) plan is less than stellar, consider letting your HR department know how you feel. Here's a guide from the Boglehead forum with tips on how to approach your employer about an expensive 401(k) plan. While changes to your plan won't happen overnight, there are steps you can take to make the best of a bad 401(k).

 

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Buffett Dumps a Lot of Oil Holdings - How About You?

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By Sarah Morgan

If you know the name of only one professional investor, chances are it's Warren Buffett. His reputation among both pros and individual investors is rock-solid. A single class A share of his company's stock (BRK-A) costs more than four times the median annual salary in the U.S. His annual letters to shareholders in Berkshire Hathaway (BRK-B) are studied by people around the world, and his portfolio is scrutinized just as closely.

So it's no surprise that the news that Berkshire Hathaway sold out its position in Exxon Mobil (XOM) has gotten a lot of attention.

Like every institutional investor that manages more than $100 million, Berkshire Hathaway has to report its holdings at the end of every quarter. These filings are available to the public, so anyone can see what Buffett is buying and selling, although at a significant delay (45 days after the end of each quarter). Berkshire Hathaway filed its report for the fourth quarter on Feb. 17, and the company's decision to sell its entire stake in Exxon, worth almost $4 billion, became big news. In addition to selling off its Exxon stock, Berkshire Hathaway also dumped the rest of its small stake in ConocoPhillips (COP) and sold some of its shares of National Oilwell Varco (NOV).

Some Investors Follow

Some individual investors may have followed Buffett's example. Data from investment management firm SigFig shows a recent spike in selling activity from everyday investors. Almost 35 percent of Exxon investors who track their portfolios with SigFig were selling in the first week of February, up from just under 30 percent in January; 42 percent of ConocoPhillips investors were selling in February, up from just under 31 percent in January. Still, individual investors remain generally optimistic on both of these stocks. More than 65 percent of Exxon investors, and more than 58 percent of ConocoPhillips investors are still buying these stocks.

The news about Buffett's exit comes at a tough time for Exxon and the oil industry in general. Oil prices have basically been cut in half in the past six months. But Buffett isn't out of energy altogether. In addition to National Oilwell Varco, Berkshire Hathaway still holds positions in Now (DNOW), an oil and gas distributor, Suncor Energy (SU), a Canadian oil sands company, and Phillips 66 (PSX), a pipeline company. And while plenty of analysts are warning investors off of energy companies right now, some hedge funds are bargain-hunting in the sector.

Two-Year Investing Is Like Day Trading

So should individual investors follow Buffett's lead and get out of Exxon? Perhaps not so fast, says Paul Nolte, senior vice president and portfolio manager at Kingsview Asset Management. For Buffett, Exxon was a relatively small, short-term investment, Nolte says. Berkshire Hathaway started buying Exxon in early 2013. For an investor who famously said his "favorite holding period was forever," a two-year investment isn't even close to long-term. "This might be day trading for Warren Buffett," Nolte says. "It may well be that he's looking at it as a commodity business, and Exxon doesn't have any distinct advantage over any other oil producer," he says.

Investors should keep in mind that Warren Buffett is a smart guy, but he's not perfect, Nolte says. "He has stumbled at times. This may very well be one of those times," he adds. Buffett is a great investing role model to watch in terms of his overall investing philosophy, but investors shouldn't try to match his every move, Nolte says. "There are a lot of stocks that he does not own that have done extremely well over the last five years," he says. And for what it's worth, Nolte says his firm is buying energy right now, because they believe the drop in oil prices has made these stocks relatively cheap.

The best lesson to learn from Warren Buffett is probably not exactly when to buy or sell a specific stock, but to stay focused on the long term, and avoid churning your portfolio. The more you trade, the less you earn, as timing and trading fees eat into your gains. Be like Buffett and look for stocks and funds you'll feel comfortable holding onto forever, or close to it.

Sarah Morgan is a contributing writer at SigFig. Nearly a million people use SigFig to track, improve and manage over $300 billion in investments.

 

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Last Week's Biggest Stock Movers: Aruba, Weight Watchers

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Plenty of stocks go up and down in any given week. The gainers inspire us to keep investing. The decliners keep greed in check while reminding us about the risks of the equity markets. Let's go over some of last week's best and worst performers.

Aruba Networks (ARUN) -- Up 35 percent last week

One of last week's biggest gainers was Aruba Networks. Strong earnings or buyout chatter can propel a stock higher, and Aruba Networks has a bit of both. The networking gear specialist did post better-than-expected quarterly results, but the big driver was a rumor that Hewlett-Packard (HPQ) was in talks to acquire the fast-growing tech upstart. HP would establish itself as a major player in Wi-Fi infrastructure with the potential purchase.

First Solar (FSLR) -- Up 22 percent last week

Things are heating up in solar. First Solar moved higher after the provider of photovoltaic solar systems announced plans to partner with SunPower (SPWR) to create an income-producing investment. SunPower and First Solar are in advanced talks to create a yield-generating stock that would own and operate solar power-backed projects. With investors chasing payouts in this low-interest-rate environment, it's a smart move.

Zagg (ZAGG) -- Up 18 percent last week

Zagg moved higher after offering up better-than-expected financials. The maker of smartphone and tablet accessories saw its sales for the holiday quarter soar 53 percent from the prior year's showing, fueled by a record number of screen protector and tablet keyboard sales.

Zagg's original smash hit was invisibleShield, the thin transparent film that can be placed over smartphone and tablet screens to protect them from getting scratched. Its quarterly profit of 43 cents a share was well ahead of the 9 cents a share that the pros were targeting.

Weight Watchers (WTW) -- Down 41 percent last week

It's not just Weight Watchers members losing weight these days. Investors have also slimmed down after another brutal quarterly report out of the dieting plan specialist. Weight Watchers has seen its number of active subscribers plunge 15 percent over the past year to 2.5 million. There are just too many free or cheaper alternatives to losing weight these days, and Weight Watchers is feeling the pinch.

Daktronics (DAKT) -- Down 19 percent last week

Those keeping score on Daktronics were burned last week after it posted disappointing quarterly results. The scoreboard maker posted flat sales growth, barely breaking even on the bottom line. Wall Street was holding out for a much larger profit. Daktronics has now fallen short in three of the past four quarters.

The more problematic aspect of Daktronics' report is that the number of orders signed during the period fell sharply, lowering its backlog of pending orders. This doesn't bode well for growth in the coming quarters.

Taser International (TASR) -- Down 15 percent last week

The stun-gun maker also slipped after falling short of analyst profit forecasts. Unlike Daktronics, this is a rare miss for Taser, which had beaten Wall Street income estimates with ease over the past several quarters.

Taser shares had moved higher in recent months after a couple of notorious and fatal police confrontations resulted in a spike in interest for less-than-lethal weaponry. Net sales did climb 17 percent to hit a new quarterly record, but coming up short in profitability did force investors to reconsider the inflated valuation.

Motley Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. Check out our free report on one great stock to buy for 2015 and beyond.

 

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Wall Street Heads Higher; Nasdaq Touches 5,000 Mark

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Inside The Nasdaq MarketSite As Juno Therapeutics Releases IPO
Victor J. Blue/Bloomberg via Getty Images
BY MATTHEW CRAFT

NEW YORK -- Major stock indexes headed higher on Monday as deals and economic news gave stocks a lift. The Nasdaq (^IXIC) briefly touched 5,000, the first time the tech-heavy index has hit that mark in nearly 15 years.

Keeping score: As of 2:23 p.m., the Standard & Poor's 500 index (^GSPC) was up seven points, or 0.4 percent, to 2,112. Consumer-discretionary stocks led six of the 10 industries in the index to gains.

The Dow Jones industrial average (^DJI) rose 116 points, or 0.6 percent, to 18,248, while the Nasdaq composite gained 29 points, or 0.6 percent, to 4,992.

Today it's about the consumer. That's the story of the day: Consumers appear to be feeling a little bit better.

Spending: The government reported Monday that consumer spending fell slightly in January, but there was better news elsewhere in the report. Overall income edged up and consumer spending actually rose when adjusted for inflation, reflecting a slide in gas prices during the month. That could turn out to be a good sign for economic growth, as people have more money left over after filling up their gas tanks.

The view: "Today it's about the consumer," said David Joy, chief market strategist at Ameriprise Financial. "That's the story of the day: Consumers appear to be feeling a little bit better."

Chippy: NXP Semiconductors (NXPI) said Sunday that it's planning to acquire Freescale Semiconductor (FSL) in an $11.8 billion deal. The merger would create the largest supplier of microchips for cars. Boards of both companies have already approved the deal, but regulators still need to sign off on it. NXP's stock jumped $13.86, or 16 percent, to $98.82, and Freescale soared $4.04, or 11 percent, to $40.15.

No bid: Sotheby's (BID) stock sank after the auction house posted a big drop in quarterly earnings. Higher expenses weighed on the company's profits, which came in below analyst estimates. Sotheby's sank $1.82, or 4 percent, to $42.13.

Solid month: Last week, the stock market closed out its best monthly gain in more than three years. The S&P 500 climbed 5.5 percent in February, its strongest gain since October 2011. Consumer-discretionary companies and technology firms had the strongest gains.

Europe: Germany's DAX closed with a gain of 0.1 percent, while France's CAC 40 fell 0.7 percent. Britain's FTSE 100 shed 0.1 percent.

China rate cut: The People's Bank of China cut interest rates for the second time in three months on Saturday, trimming the rate for one-year commercial loans to 5.35 percent. It's the latest measure aimed at propping up growth in the world's second-largest economy. The government has recently cut business taxes and boosted pay for government workers.

Asia's day: Japan's Nikkei 225 gained 0.2 percent, and South Korea's Kospi added 0.6 percent. In China, Hong Kong's Hang Seng Index rose 0.3 percent, while the Shanghai Composite Index advanced 0.8 percent.

Energy: Benchmark U.S. crude oil rose 78 cents to $50.54 a barrel on the New York Mercantile Exchange.

Currencies: The dollar rose to 119.72 yen from 119.63 late Friday. The euro gained to $1.1229 from $1.1199. Prices for U.S. government bonds fell, pushing yields up. The yield on the 10-year Treasury note rose to 2.06 percent from an even 2 percent late Friday.

Crude: Benchmark U.S. crude oil slipped 21 cents to $49.56 a barrel on the New York Mercantile Exchange.

Metals: Precious and industrial metals ended mixed. Gold dropped $4.90 to settle at $1,208.20 an ounce, while silver slipped 11 cents to $16.45 an ounce. Copper picked up a penny to $2.70 a pound.

 

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A Tax Break for Going Gluten-Free?

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Going Gluten-Free Could Get You a Tax Break

By Rebecca Dolan

If you're among the one in three Americans making a lifestyle choice to avoid gluten -- a protein found in wheat, rye, and barley -- or the one in 100 Americans diagnosed with celiac disease, which prohibits gluten intake, you've likely seen your food costs go up.

Restaurants often charge more for gluten-free pizza crust or pasta, for example. And at the grocery store, we found a Freschetta four-cheese medley pizza for $6.99, compared with the gluten-free version at $9.99. Likewise, a box of regular Betty Crocker yellow cake mix costs $2.49, while the gluten-free version is $4.69.

"[I]if you are on a restricted diet for a particular disease and if you have a doctor's certification that you should be on such a diet, you can treat it as a medical expense.

Did you know you might be eligible for a tax break to help offset some of those costs?

The weight-loss area of the tax law offers guidance for restricted diets, says Mark Luscombe, principal federal tax analyst for tax publisher CCH. "That says if you are on a restricted diet for a particular disease and if you have a doctor's certification that you should be on such a diet, you can treat it as a medical expense," he explains.

IRS Information Letter 2011-0035 affirms the tax break: "[T]he excess cost of specially prepared foods designed to treat a medical condition over the cost of ordinary foods which would have been consumed but for the condition is an expense for medical care."

But claiming the tax break isn't without hurdles. For starters, you must have certification from a doctor that you have a medically necessitated diet due to celiac disease, an autoimmune disorder in which the ingestion of gluten leads to damage in the small intestine. Going gluten-free as a beneficial lifestyle choice isn't going to cut it.

Except with products such as xanthan gum and sorghum flour, for which there is no gluten-filled alternative, you'll only be able to deduct the difference in cost between gluten-free food and "normal" food. Be sure to hold on to all of your receipts to keep track of your costs and support your deductions; scribble the cost of the cheaper, gluten-filled alternatives on the back of your receipts.

You can deduct medical expenses only if you itemize and only if they exceed 10 percent of your adjusted gross income, or 7.5 percent if you're older than 65. All of your eligible medical expenses can be combined to try to exceed that 10 percent threshold. If you have any other health considerations, check IRS Publication 502, Medical and Dental Expenses to see if they can also be written off.

 

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Costco Strikes Credit Card Deal with Citi, Visa

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American Express Costco Agreement
Rick Bowmer/AP
NEW YORK -- Costco says it struck a deal for Citi to be the exclusive issuer of its co-branded credit cards, with Visa replacing American Express as the card network.

The deal is subject to Citi buying the company's co-branded credit card portfolio, Costco said.

Costco and American Express (AXP) ended their partnership after failing to reach an agreement on renewal terms. American Express said earlier this month that the relationship, which goes back 16 years, is set to expire March 31, 2016. Costco says the deal with Visa and Citigroup (C). would take effect the next day.

The deal means that Visa will be the only credit cards accepted at Costco stores. Currently Costco accepts only American Express credit cards, though it takes debit cards from other companies including Visa and Mastercard (MA).

The company said it would provide its customers with information about the transition in coming months. David Sherwood, Costco's director of finance and investor relations, said in a phone interview it was yet to be determined if people will have to reapply for their Costco rewards cards.

Costco uses the exclusive deal to lower the credit card processing fees it pays. Processors typically charge retailers more for credit transactions than for those on debit cards.

Costco Wholesale, based in Issaquah, Washington, has 474 locations in the United States and 88 in Canada. It is the world's second-largest retailer by revenue, according to the National Retail Federation.

Shares of Visa (V) rose $5.12, or 1.9 percent, to $276.43 in early afternoon trading. Costco's (COST) shares rose $1.28 to $148.24.

 

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Consumer Spending Falls, Inflation Pressures Muted

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Consumer Spending
Richard Vogel/AP
By Lucia Mutikani

WASHINGTON -- U.S. consumer spending fell for a second straight month in January as households continued to cut back on purchases, opting to save much of the massive windfall from cheaper gasoline.

Other data Monday showed factory activity slowed sharply in February, with manufacturers saying a labor dispute at the country's West Coast ports had caused supply chain disruptions.

Consumer spending, which accounts for more than two-thirds of U.S. economic activity, slipped 0.2 percent after falling 0.3 percent in December. The drop in January reflected lower gasoline prices, which have weighed on sales receipts at service stations, as well as declines in goods purchases.

The increase in real consumer spending is a clear sign that falling gasoline prices are starting to show up at the cash register.

Lower gasoline prices further dampened inflation pressures in January. When adjusted for inflation, consumer spending increased 0.3 percent after December's 0.1 percent drop.

"The increase in real consumer spending is a clear sign that falling gasoline prices are starting to show up at the cash register," said Chris Christopher, an economist at IHS Global Insight in Lexington, Massachusetts.

U.S. stocks were trading higher, while prices for U.S. Treasury debt fell. The dollar rose marginally against a basket of currencies.

Households are using much of the savings from cheaper gasoline to pay down debt and build savings.

Retreating inflation also helped boost household income and saving in January.

Income at the disposal of households after accounting for inflation advanced 0.9 percent, the largest increase since December 2012. The saving rate increased to 5.5 percent, the highest since December 2012.

Lower gasoline prices continued to put downward pressure on inflation, with key consumer price gauges slipping further below the Federal Reserve's 2 percent target.

A price index for consumer spending braked to show a 0.2 percent rise in the 12 months through January, the weakest reading since October 2009.

The personal consumption expenditures price index had increased 0.8 percent in December. Excluding food and energy, the so-called core PCE price index increased 1.3 percent in the 12 months through January.

Fed Action on Hold?

"With further weakness in price pressures, the latest inflation report offers no reason to assume inflation has stabilized, let alone is reversing course back toward the committee's longer-term target," said Lindsey Piegza, chief economist at Sterne Agee in Chicago.

"Continued pressure on prices will further delay Fed action."

The Fed is widely expected to raise interest rates this year after holding them near zero since late 2008.

In a separate report, the Institute for Supply Management said its index of national factory activity fell to 52.9 in February, the lowest reading in 13 months, from 53.5 in January. A reading above 50 indicates expansion in the manufacturing sector.

From food to machinery and computers and electronic products, manufacturers blamed the labor dispute at the West Coast ports for a slowdown in activity. The dispute, which has since been resolved, caused goods to pile up at the ports.

"We know that dispute got a lot worse in January, with both incoming and outgoing container shipments falling by roughly a quarter from December levels. It will take several months for the backlog to be cleared," said Paul Ashworth, chief U.S. economist at Capital Economics in Toronto.

Another manufacturing survey produced by financial data firm Markit showed a jump in factory activity in February.

-With additional reporting by Michael Connor in New York.

 

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5 Dates for Savvy Investors to Circle in March

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Apple
Marcio Jose Sanchez/AP
It's been an up-and-down year so far in 2015. Stocks moved lower in January, only to bounce back last month. Along comes March to break the tie. Let's check out some of the potentially market-shaping events that will take place in the coming weeks.

March 5: We will get a glimpse into the state of the supermarket industry Thursday morning when Kroger (KR) reports quarterly results. Kroger is a major player here. Its empire consists of 2,631 grocery stores under several different banners, 783 convenience stores, 325 fine jewelry stores, and 1,293 fuel centers.

Analysts see Kroger's revenue climbing 8 percent over the prior year's holiday quarter with profitability growing even faster.

March 9: Apple (AAPL) will be hosting a media event next Monday. The "spring forward" invitation finds watchers of the tech giant holding out for the debut of the highly anticipated Apple Watch.

Apple has been slow to throw its hat into the wearable computing ring, so naturally it will be trying to make up for lost time with its smart watch. There were concerns last year about pricing and battery life, so it will be interesting to see where the Apple Watch stands on both fronts.

March 10: It's been four years since Borders was forced by creditors to liquidate, closing down all of its stores in the process. That corporate-crushing event was initially a godsend for Barnes & Noble (BKS), but even the country's last remaining major book retailer is struggling these days.

Barnes & Noble was originally expecting to spin off its Nook and college bookstore businesses, but it announced last week that it would be keeping its e-book business after all. The chain reports next week, and Wall Street sees improving profitability on declining sales for the seasonally potent holiday quarter.

March 13: The South by Southwest -- or SXSW -- festival kicks off in Austin later this month. Most people see the annual festival as a the launch pad for music and film projects, but there's also an interactive element where budding upstarts and established titans of tech show off their latest innovations.

Twitter (TWTR) and Foursquare used SXSW to introduce the world to their social media platforms, and investors may want to keep tabs on the five-day festival to see which upstarts turn heads.

March 27: BlackBerry (BBRY) was once such an iconic brand in smartphones that industry pioneers affectionately referred to the company as CrackBerry given its addictive nature. It's a different landscape in 2015, when Android and Apple's iPhone dominate the market.

BlackBerry is still around, hoping that its email-centric and secure platform appeal to corporate customers. It hasn't been enough. Owners continue to kick the habit, shifting to Android, iOS, and even Windows Phone. BlackBerry reports later this month, and the market's holding out for a small quarterly loss on another double-digit decline in revenue.

Motley Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Apple and Twitter. The Motley Fool owns shares of Apple, Barnes & Noble and Twitter. Try any of our Foolish newsletter services free for 30 days. Check out our free report on our favorite high-yielding dividend stocks.​

 

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Bill Gates Once Again Tops Forbes' List of Billionaires

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Forbes Billionaires
Nati Harnik/APMicrosoft co-founder Bill Gates
NEW YORK -- The world's richest person got even richer this year. And a basketball superstar-turned-owner made the list for the first time.

Bill Gates's net worth rose to $79.2 billion in 2015 from $76 billion last year, Forbes said Monday. That put him at the top of the magazine's list of the world's billionaires for the second consecutive year. The co-founder of Microsoft (MSFT) has topped the list for 16 of the last 21 years.

In second place is Mexican telecommunications mogul Carlos Slim Helu, with a net worth of $77.1 billion. He had topped the list in 2013.

Next is investor Warren Buffett, who moved up one slot this year with a net worth of $72.7 billion. In fourth place was Amancio Ortega, the Spanish co-founder of clothing retail chain Zara, with a net worth of $64.5 billion. Rounding out the top five was Larry Ellison, founder of technology company Oracle (ORCL), with $54.3 billion.

Forbes said there were 1,826 billionaires on its list this year, up from 1,645 in 2014. Added together, they were worth a combined $7.05 trillion, up from $6.4 trillion last year.

Most of the those on the list were men. But there were 197 women, up from 172 a year ago. The highest-ranking woman was Christy Walton, the widow of John Walton, a son of the founder of Walmart Stores (WMT). She has a net worth of $41.7 billion, according to Forbes.

The world's youngest billionaire was 24-year-old Evan Spiegel, the CEO and co-founder of mobile messaging company Snapchat, with a net worth of $1.5 billion. Snapchat's other co-founder, 25-year-old Bobby Murphy, had the same net worth as Spiegel. Other tech billionaire newcomers were two co-founders of taxi-ordering app Uber and one of its executives. Three co-founders of Airbnb, the vacation-home rental website, also made the list.

Basketball legend Michael Jordan joined the list for the first time this year, thanks to his ownership in basketball team Charlotte Hornets and payouts form his Nike (NKE) brand. Jordan had a net worth of $1 billion, the magazine said.

This is the the 29th year that Forbes has released its billionaires list. The magazine said it calculated each person's wealth based on stock prices and exchange rates on Feb. 13, 2015.

Forbes said it calculated each person's net worth based on stock prices and exchange rates on Feb. 13, 2014.

Here's the list of the Top 10:

1. Bill Gates
Net worth: $79.2 billion
Source of wealth: Technology company Microsoft Corp.
Nationality: American

2. Carlos Slim Helu
Net worth: $77.1 billion
Source of wealth: Telecommunications
Nationality: Mexican

3. Warren Buffett
Net worth: $72.7 billion
Source of wealth: Investment holding company Berkshire Hathaway Inc.
Nationality: American

4. Amancio Ortega
Net worth: $64.5 billion
Source of wealth: Retail chain Zara
Nationality: Spanish

5. Larry Ellison
Net worth: $54.3 billion
Source of wealth: Technology company Oracle Corp.
Nationality: American

6. Charles Koch (tie)
Net worth: $42.9 billion
Source of wealth: Conglomerate Koch Industries.
Nationality: American

6. David Koch (tie)
Net worth: $42.9 billion
Source of wealth: Conglomerate Koch Industries.
Nationality: American

8. Christy Walton
Net worth: $41.7 billion
Source of wealth: Retailer Walmart Stores.
Nationality: American

9. Jim Walton
Net worth: $40.6 billion
Source of wealth: Retailer Walmart Stores.
Nationality: American

10. Liliane Bettencourt
Net worth: $40.1 billion
Source of wealth: Cosmetics company L'Oreal
Nationality: French

 

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Keurig Goes for a Slam Dunkin' With Coffee K-Cups

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dunkindonuts.com
It's going to be a lot easier for fans of Dunkin' Donuts coffee to get their java fix. Keurig Green Mountain (GMCR) last week expanded its partnership with Dunkin' Donuts parent Dunkin' Brands (DNKN) and its coffee distributor J.M. Smucker (SJM).

Dunkin' Donuts makes its signature coffee available as K-Cup portion packs for Keurig brewers that it sells through thousands of Dunkin' Donuts doughnut shops today. The expanded deal will now find Dunkin' K-Cups sold through more retail outlets, including Keurig's own website.

Going from thousands of places to buy Dunkin' K-Cups to tens of thousands is a win-win-win deal. Smucker will naturally ring up more sales as the distributor, but there's even more to gain by Keurig and Dunkin' Brands.

Tossing Out a Wider Net

Keurig is the undisputed champ of single-serve brewing platforms. There's no one that's even close to the company that made one-cup servings of premium coffee, accessible anywhere, that one can plug in its namesake brewer.

Keurig Green Mountain has been one of the market's biggest winners over the past few years. The stock has been a 30-bagger over the past eight years. Unfortunately, it's feeling pretty mortal these days. Last month's quarterly report was problematic. Net sales were flat with the prior year, held back by a 12 percent decline in brewer sales volume.

It's easy to spot the problem. Keurig got greedy last fall, rolling out the Keurig 2.0 platform that came with a digital rights management feature that refuses to brew any K-Cup that doesn't have a Keurig-authorized lid. It's easy enough to circumvent. Those with older K-Cups and third-party portion packs can simply slap a newer label on the lid to trick the scanner. However, the whole episode left a bad taste in consumers' mouths. Customer reviews for the new brewers haven't been kind.

Making Dunkin' Donuts brews more widely available won't repair Keurig's reputation, but it does solidify the lineup.

Making the Dough Nuts

Dunkin' Brands can also use the boost. Comparable-restaurant sales at Dunkin' Donuts rose just 1.4 percent in its latest quarter, and the uptick was even more modest overseas. Dunkin' needs to keep sales growing at the individual store level if it wants to continue to build out its franchisee-fueled concept, and expanding the exposure of its popular coffee can help.

One would normally think that making Dunkin' coffee easier to brew at home or the office break room would hurt sales of franchisees. Why go line up at a Dunkin' Donuts if the same beans can be brewed anywhere else?

Well, in a savvy move, Dunkin' is cutting its franchisees in on the action. Dunkin' Brands will share the proceeds with its franchisees. The unprecedented deal could yield between $2,500 and $3,000 a year for franchised locations. For once we find the franchisees on the royalty-collecting end of the arrangement. It's a development that could actually encourage more franchisees to hop on, giving them a new revenue channel to consider.

So, yes, this is a deal that should benefit all three companies, but Keurig Green Mountain is the one that probably needs this the most.

Motley Fool contributor Rick Munarriz owns shares of Keurig Green Mountain. The Motley Fool recommends Keurig Green Mountain. Try any of our Foolish newsletter services free for 30 days. To read about our favorite high-yielding dividend stocks for any investor, check out our free report.

 

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Market Wrap: Rally Pushes Nasdaq to Highest Level Since 2000

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NASDAQ Climbs Above 5000 Points For First Time In 15 Years
Bryan Thomas/Getty Images
By Sinead Carew

NEW YORK -- The Nasdaq closed above 5,000 for the first time Monday since the year 2000 dot.com bubble, as tech stocks were boosted by deals. The S&P 500 and Dow indexes, meanwhile, hit records after economic data pointed to a slowly accelerating economy.

After oscillating around it for much of the day, the Nasdaq composite index gained steam in the late afternoon to finish firmly above the milestone it last reached on March 27 2000, marking only the third time the index closed above 5,000.

"You've an entirely different make-up of stocks. Real earnings and revenue are driving the Nasdaq now," said Douglas Depietro, managing director at Evercore ISI in New York. "Anything with a website went to $100 back then."

Tech Rally

The Nasdaq was boosted Monday by chipmakers NXP Semiconductors, Intel (INTC), as well as network equipment-maker Cisco Systems after two big deal announcements.

Shares of NXP (NXPI) rose 17.3 percent to $99.56 after it agreed to buy smaller peer Freescale Semiconductor (FSL) to create a company valued over $40 billion. Freescale rose 11.8 percent to $40.36.

Hewlett-Packard (HPQ) said it would buy Wi-Fi gear maker Aruba Networks (ARUN) for about $2.7 billion, the biggest deal for the world's No. 2 PC-maker since 2011. Rival Cisco (CSCO) rose 2.3 percent to $30.19.

"Going forward for the rest of the week, you may see a little pause because people are waiting for the economic data release Friday, because that may give an indication what the Fed's going to do about interest rates," said Depietro.

Weighing the Economic Data

U.S. consumer spending fell for a second month in January, with lower gasoline prices dampening inflation pressure while personal income fell just short of expectations, showing a rise of 0.3 percent.

Separate gauges of manufacturing conflicted, as financial data firm Markit's final U.S. Manufacturing Purchasing Managers' Index hit a four-month high while a reading from the Institute for Supply Management fell to its lowest in 13 months.

Money is continuing to pour into the market because of low interest rates, and although stocks are somewhat expensive they're not overly expensive.

The Dow Jones industrial average (^DJI) rose 155.93 points, or 0.86 percent, to 18,288.63, the Standard & Poor's 500 index (^GSPC) gained 12.89 points, or 0.61 percent, to 2,117.39 and the Nasdaq composite (^IXIC) added 44.57 points, or 0.9 percent, to 5,008.10.

'Not Overly Expensive'

"Money is continuing to pour into the market because of low interest rates, and although stocks are somewhat expensive they're not overly expensive," said Stephen Massocca, chief investment officer at Wedbush Equity Management in San Francisco.

Lumber Liquidators (LL) plunged 25 percent to $38.83 after a news report said its products failed to meet safety standards, allegations the hardwood flooring retailer denied.

About 6.43 billion shares changed hands on U.S. exchanges, compared with the 6.3 billion average for the last five sessions, according to BATS Global Markets.

NYSE advancers outnumbered decliners 1,851 to 1,214, for a 1.52-to-1 ratio; on the Nasdaq, 1,792 issues rose and 960 fell, for a 1.87-to-1 ratio.

The S&P 500 posted 57 new 52-week highs and 4 new lows; the Nasdaq composite recorded 144 new highs and 32 new lows.

-With additional reporting by Caroline Valetkevitch.

What to watch Tuesday:
  • Automakers release vehicle sales for February.
Earnings Season
These selected companies are scheduled to release quarterly financial results:
  • AutoZone (AZO)
  • Barclays (BCS)
  • Best Buy (BBY)
  • Bob Evans Farms (BOBE)
  • Dick's Sporting Goods (DKS)
  • JD.com (JD)
  • Kate Spade (KATE)
  • Navistar International (NAV)
  • Tri Pointe Homes (TPH)
  • TiVo (TIVO)

 

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How to Find a Retirement Home That Keeps You Vibrant

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Horizontal|Color Image|Photography|Indoors|Day|Water|Retirement|Lifestyles|Sports And Fitness|Travel|Vacations|Caucasian|Recreat
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By Maryalene LaPonsie

Lynn Mercer sports a bumper sticker on her vehicle that reads "Living in the Cove and Loving It." That's how much the 67-year-old likes her retirement community, Colony Cove, in Ellenton, Florida.

However, not everyone is so enamored by the idea of moving to a community intended for seniors. "Unfortunately, people ... think of rocking chairs out on the front porch," says Jean Gallios, 88, who has lived at Emerald Heights, a retirement community in Washington state, for more than 22 years.

Like Mercer, Gallios says her experience has exceeded expectations, and her retirement community is a far cry from the stereotype of a dreary institution where seniors have tiny apartments or gather in bland communal rooms.

If your current home has become a burden, but you dread the idea of moving to a retirement home, you may be surprised by the amenities and atmosphere offered at many senior communities. Here are five tips to help you find a place to retire that won't make you feel like you're being put out to pasture.

1. Think Resort Community, Not Retirement Home

"The biggest misnomer is that retirement communities are for old people," says Lisa Hardy, CEO of Emerald Communities, which owns Emerald Heights, where Gallios lives. "There are lots of vibrant, young retirees living in communities across the U.S."

Hardy equates the experience of today's retirement communities to living on a cruise ship or visiting a resort. Depending on the community, there may be on-site restaurants, spas and entertainment venues. Residents could spend the day crafting in an art studio, swimming in the pool or visiting with out-of-town family who are renting a cottage on the property or staying in a community-run hotel.

If there is one thing these communities are not, it's institutional. That's one reason why Gary and Theresa Bennett were convinced to put down a deposit on the latest Emerald Communities development, Heron's Key, in Gig Harbor, Washington. With a variety of available floor plans, including apartments and cottages, and plenty of amenities, the couple decided Heron's Key would feel like home and not a facility.

2. Keep Continuing Care In Mind but Out of Sight

For many seniors, the prospect of needing extra care in the future is a motivating factor in the decision to move into a retirement community. Certainly, it was for the Bennetts who, at ages 69 and 72, respectively, already live in a condo in Gig Harbor but wanted the security offered by a community. "With family spread around, what happens to [my wife] if I pass away?" Gary asks.

Many retirement communities offer continuing care services that allow seniors to stay on-site but move into assisted living and skilled nursing settings. Seniors like Gallios and her husband, who saw three of their four parents require nursing home care, find comfort in knowing they won't have to go far if they can no longer live independently. What's more, Emerald Communities won't charge them anything extra per month for it.

While continuing care is an important consideration when selecting a community, you don't necessarily want it to be a constant reminder of where you might end up in a few years. Before selecting a community that offers continuing care, ask how the different care levels are arranged on-site. "People want to know skilled nursing is there," Hardy says, "but they don't want to see it."

3. Get Involved Before You Move

Checking out the amenities and people in advance is another way to find a retirement community that doesn't make you feel old. "The location was important to us," Mercer explains, "but it was also important to find a community with lots to do."

If possible, see if the communities on your shortlist allow prospective residents to join activities where they can meet other current or future residents. For example, even though the Bennetts' home is still in development, the community has been holding social events so future residents can cultivate friendships in advance of their move-in date.

4. Allow Time to Review Your Options

Taking time to find the right community is another reoccurring theme that emerges in conversations with happy retirees.

For Gallios, it was a 10-year journey to find the perfect home. After she and her husband spent a year cleaning out her parents' house after their passing, they decided to do things differently as they aged. The following year, on her husband's 55th birthday, they started their hunt for the perfect community. It was 10 years later, to the day, when they settled in as two of the earliest residents at Emerald Heights.

The Bennetts experienced something similar. Gary Bennett feared being in a situation in which one of his out-of-town sons would come for a long weekend that would result in a whirlwind tour of communities one day and moving in the next. He didn't want to end up in a high-pressure situation like that. Instead, he and his wife took their time to research options and ensure they could move, on their own terms, to a community they love.

5. Look Outside the 55-Plus Communities

A final tip to finding a retirement community that doesn't make you feel old may be to bypass retirement communities entirely.

Tammy Barry is the director of sales and marketing for Heritage Harbor Ottawa, a resort community about 90 minutes southwest of Chicago. She describes it as a "stroller to wheelchair" community that has attracted retirees as well as young families and singles. "What I've heard from residents is that they like they are in a resort setting but close to their kids and grandkids," she explains.

Seniors who go this route may want to consider factors such as property maintenance requirements, the availability of public transportation and proximity to health care providers. In the case of Heritage Harbor Ottawa, although it's not a continuing care retirement community, it is in the process of developing a memory care and assisted living facility on a neighboring property that will offer convenient care options to aging residents.

While not the same as a community catering to seniors, an all-ages resort community can meet the needs of older adults. "There's always an energy [here]," Barry says. "[You] don't have to feel like 'I'm one step away from the nursing home.'"

Retirement homes and communities may conjure visions of elderly residents shuffling about with little to do, but seniors in these communities disagree. According to Gallios, finding the right community means you can expect a life that's about as perfect as it gets.

 

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6 Ways to Live Like You're Rich - but Not Spend a Lot

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Living on a budget doesn't have to mean living a boring, bland life. In fact, if you're smart about the way you manage your money, you can enjoy some perks that feel outside of your means, at a cost that's entirely within budget.

Here are six ways to enjoy a full, satisfying and -- dare we say it? -- downright luxurious life while still keeping a modest budget.


Paula Pant quit her office job in 2008, traveled to 32 countries and is a successful real estate investor. Her blog Afford Anything is the groundswell of a rebellion against tired old financial advice that says you should skip lattes and chain yourself to a desk for 40 years. Afford Anything helps you crush limits, create riches and maximize life.

 

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This Retailer Is America's Most Respected Company

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Wegman's Takes No. 1 Spot For Best Reputation

As a retailer, Amazon.com (AMZN) reigns all but supreme. The Internet giant sells goods and services to customers in every state of the union -- and to 76 countries around the world besides. Every year, Amazon does $89 billion in business (although according to S&P Capital IQ data, Amazon loses money on that business).

And yet, this year, Amazon just yielded pride of place on Harris Interactive's poll of America's most loved companies to a little Rochester, New York-based brick-and-mortar supermarket operating in just six states and pulling down only one-tenth of Amazon's revenues.

Its name: Wegmans Food Markets.

Harris' Poll Gets Bigger -- and Amazon's Reputation Gets Smaller

For 16 years, Harris (a subsidiary of Dutch Nielsen N.V. (NLSN), of television ratings fame) has been putting out its own "Reputation Quotient" report on the 60 "most visible companies" doing business in America. These range from homegrown brands such as Amazon and Wegmans to foreign imports like Sony (SNE) and Samsung (SSNLF) (ranked 13th and third on the list, respectively).

"Reputation is far from static and is a business asset that is earned every day as people evaluate companies through the lens of what matters most to them,"Carol M. Gstalder, Harris Poll reputation and public relations practice leader, says in a news release. In this poll, which it expanded to cover 100 companies for the first time this year, Harris aims to quantify which companies are hot -- and which are not.

Why? "More than half of the public actively seeks out information about companies they hear about or do business with" -- what Harris terms "visibility." What's more, 36 percent of shoppers say "they've decided against doing business with a company because of something they learned about its conduct." In other words, reputation -- both bad and good -- matters. And "companies need to evaluate and understand the increasing expectations consumers have when it comes to corporate reputation," according to Harris, if they want to climb to the upper ranks of this poll -- and presumably run a more successful business.

Why Wegmans Wins

This year's winner, Wegmans, edged out Amazon by "building a sterling reputation in the communities [it serves], through its employees, one shopping experience at a time," says Gstalder. It probably doesn't hurt that, as retailers, both Wegmans and Amazon are companies that shoppers deal with on a daily, or at least weekly, basis -- giving both companies multiple opportunities to burnish their reputations with their customers. No. 4-ranked Costco (COST) probably benefits from the same dynamics -- and helps to give retailers three of the top four slots on Harris' poll.

Although Wegmans was one of the 40 companies only just now added to the list in this year's poll, its appearance at the top shouldn't come as a huge surprise. Harris Poll's Equitrend survey just last year found Wegmans rated tops among supermarket shoppers in the U.S. Northeast.

Elsewhere in the nation in last year's Equitrend poll, Costco was named the most popular grocer in the West, Publix in the South, and Hy-Vee in the Midwest. In the Reputation Quotient study, these chains placed fourth, eighth and unranked, respectively, among the 100 "most visible companies."

As for the other companies on the list, Harris assigns to each ranked company a Reputation Quotient score ranging from 1 to 100. Of the 100 companies reviewed, none was found to have "critical" problems with its reputation (i.e., a score below 50) -- although investment banker Goldman Sachs (GS) came closest with a score of just 55.07.

Conversely, an even dozen companies hit Harris' target mark of an RQ score above 80. In addition to Nos. 1 and 2 Wegmans and Amazon, these include, in order:
  • Samsung.
  • Costco.
  • Johnson & Johnson (JNJ).
  • Kraft Foods (KRFT).
  • L.L. Bean.
  • Publix.
  • Apple (AAPL).
  • Google (GOOGL) (GOOG).
  • Berkshire Hathaway (BRK-B).
  • Disney (DIS).
Counting L.L. Bean, Publix,and Apple Store-owning Apple as "retailers," this means that an even half of the top dozen we love the most are retailers we shop at regularly.

When these businesses do their jobs right, familiarity doesn't breed contempt, but respect.

Fact: Despite growing up in the Northeast, Motley Fool contributor Rich Smith has never been inside a Wegmans -- but he's heard good things. The Motley Fool recommends Goldman Sachs. The Motley Fool recommends and owns shares of Amazon.com, Apple, Berkshire Hathaway, Costco Wholesale, Google (A and C shares), Johnson & Johnson and Walt Disney. Try any of our Foolish newsletter services free for 30 days. Check out our free report on our favorite high-yielding dividend stocks.​

 

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The 5 Biggest Personal Finance Milestones From My Life

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I want to talk about the five biggest moments in my personal finance journey. I was never destitute, but growing up with a single mom, we didn't have anything resembling financial security. When it was time for me to go off on my own, I promptly did a financial faceplant and amassed a bunch of debts that are frankly embarrassing to think about today. It has been more than a decade since I started turning things around, and half that time since I really started to gain ground. Lots of people can replicate in these milestones in their own lives.

  1. I hit rock bottom. When I look at pictures of myself at 21 and 22, I want to slap my stupid face. That kid spent and partied his way to five figures of debt with very little money coming in. I hope you enjoy that sports car, because you certainly can't afford it! I didn't really know better yet, but I quickly learned when I couldn't afford to make payments and I found out that I would be paying off my debts for more than a decade at the rate I was going. It took awhile for the reality of this to sink in. I will be poor -- this poor -- for many years to come. So I changed things up. I sold my car. I worked 70-80 hours a week at two jobs for almost two full years. I stopped wasting money and time, and I threw every extra dollar at my debts until ...
  2. I paid off my debt. In less than two years, no less! This was a huge eye opener for me. Not only had I killed off debt that was set to haunt me for a big chunk of the rest of my life, I had done it quickly. I've got to credit my mom for inspiration on this one. I had seen her turn her life around by buying a business a couple of years before. Seeing that another life was possible gave me the energy to work stupid long hours until my head was above water. It was a great feeling, but it didn't stop there.
  3. I started saving. For over a year, I was putting upwards of $1,000 into debt balances, every single month. Now I had no more debt. I kept working at the same rate for about half a year, still saving that much every month. But I started saving it in several key areas: 1) a six-month emergency fund, 2) a fund for the down payment of a house, 3) monthly contributions into my fresh new individual retirement account, 4) a fund for travel and 5) a fund to help start my business. Once the emergency fund was filled up, I could contribute even more to these other areas. At some point, I burned out laboring like a workaholic (not my natural mode of existence), so I quit my other job and took a breather. I can't tell you how much my mindset at this time differed from that of two years before. I felt like I could breathe. I didn't feel anxious. I felt good.
  4. I started my business. This takes us to about 2010, when I started getting the Modest Money blog off the ground. MM didn't become my full time gig for a couple more years, but I had learned the basics of web marketing through one of my jobs, and I knew I could do this thing myself. I spent thousands of hours learning how to really do this thing. I went to conferences, learned coding and talked to anybody who knew something I didn't about blogging. I also started a couple of side web ventures, a couple of which are still going strong today. Today, my work life is pretty fluid. Some days I work for other people, many days just for myself. I have a lot of residual income streaming in from many sources. If one business goes belly up, I know there are different revenue streams that will survive. The same goes for my investments.
  5. I bought my house. I don't know if I just missed the memo on home ownership when I was growing up, but it has turned out to be an awesome way to build wealth. My home has appreciated about 7 percent every year I've owned it. Because my taxes and interest payments are written off on my taxes, that's a 28 percent return on my investment since I bought my house. Add to this the steadily building wealth I've gained through equity, and my home might be the single best investment I have made in life thus far. It makes me want to buy more real estate.

The Hero in Your Future

I don't know if you saw Matthew McConaughey's crazy-eyed Oscar acceptance speech from last year, but he said something I'll always remember. He said that his hero in life was himself 10 years from now. That might sound a little conceited if you don't frame it right. Basically, he said he wanted to always be pushing himself to be better, to become someone that his past self could respect and admire. I want to do the same. I think my little debt-ridden self from a decade-plus ago would like the guy I've become. I want the same to go for the guy I am 10 years from now. Here are a couple bonus milestones I'd like to see in my future.

  1. More houses. I'd like to own a few houses. I've seen the way my current place has appreciated, and I'd like to rent to others. Growing up in a string of rental places, I know how vulnerable being a renter can be. I remember good landlords and bad ones. If I'm going to invest in properties, I want to provide quality housing to people without pushing for the highest dollar tenants. Just a personal project, but it's something close to my heart. The way I look at it, it's a way I can grow my money while providing a service that people actually need.
  2. Investments for my children. I don't have kids, and my girlfriend and I have no specific plans. But I want them someday. Before I start reproducing, I want to have investments in place for them to at least be able to go to college, to get a level of education somewhat better than the one I had.

These future investments will only be possible because I made the changes I mentioned in the first milestone. Without changing my life and paying off my debt, I never would have been able to achieve any level of wealth. Many people never get past that first step. I want to encourage you to make the change. Those two years or so were the hardest step on this journey. I guess that's why more people don't get past that stage. If I can do it, you can. Feel free to reach out to me or check out my writing for tips on how. But it's not rocket science. You can get there just like I did.

 

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