Financial Questions and Answers
Q: I’m interested in investing in foreign or international stocks. How risky is this?
A: As a real estate agent might say, it depends on location, location, location. Stocks from developed countries, such as those in Europe, trade much like U.S. stocks. As with any stocks, their prices will rise and fall, but the markets themselves are mature. Stocks from emerging countries like China and India are riskier, and frontier countries’ stocks are even riskier and less predictable. As with any investment strategy, you need to consider your risks versus potential rewards. Many balanced portfolios include international stocks, but it is up to you to do your homework before investing.
Q: I live in a high-tax state, where I can no longer deduct all my state and local taxes, so I’m considering a move. Any advice?
A: If it’s only about money, there are states without a state income tax and with low real estate taxes, but they may have high sales taxes. There are also other factors to consider beyond money, including how you might adapt to moving to a strange locale and leaving friends and loved ones. Your best bet? Try out potential new locales before making any move permanent. And remember tax laws can change, regardless of location.
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