By Jacqueline Marcell
(Impressive Press, April 2001) $17.96

I grew up with a “Jekyll & Hyde” father who was wonderful most of the time, but when he’d get mad he’d explode in a screaming, pounding-his-fist rage. It was never directed at me, I was the golden child, but I watched his temperament change like a light-switch as he’d yell at my mother and brother. We would cower and walk on eggshells trying not to upset him. After my parents retired, my mother had a heart attack and he took care of her for 11 years, refusing all help, despite my constant efforts to hire caregivers who he would throw out. When my mother nearly died from an infection caused by her own waste because he had not kept her clean and taken her to the doctor, I had to step in despite his loud protests.

I started to experience his rages at a heightened level over things that seemed so illogical and irrational. When he took two filthy hand towels out of the trash and threw them at me, accusing me of throwing out all their things, I was stunned and sobbed my heart out to have him turn on me. I thought it was just more of his bad behavior of a lifetime, getting intensified by my mother’s near-death illness and the stress of caring for her for so long without help.

I reported his illogical behavior to the doctor but whenever she saw him, he’d act so normal, so darling, so in control, I couldn’t get help with medications. He was able to act completely sane when he needed to. I didn’t find out until much later that he had told the doctor that I was just after his money and that she shouldn’t pay any attention to me. She knew him for twenty years and didn’t know me very well, as I lived four hundred miles away.

It took me a year to solve it on my own, riding a roller coaster of emotions as some days he’d be my loving dad and so normal, and then all of a sudden something would set him off and he’d go into a screaming tirade calling me every nasty name he could think of. As I tried to make safety changes to my parents home and help them, he threw me out and even choked me over adding HBO to his television for a caregiver who had requested it, even though he had previously given his permission. The police were called and he was 5150′d to a psychiatric hospital for a 72-hour observation.

When he got to the psych unit, he was so adorable, so normal, they released him, telling me they couldn’t find anything wrong with him. After four episodes of violence, and 40 caregivers later, I had to threaten the psychiatrist with a lawsuit if they released him and he came home and hurt anyone. They finally held him 2 weeks (called a “5250″)and reported that he couldn’t learn very well and that his memory was slipping. It was so intermittent, he was able to act normal most of the time, and was still able to hide his life-long temper tantrums.

I finally found help when I got him to the Alzheimer’s Association’s best recommendation for a geriatric dementia specialist who did extensive neurological tests and CAT scans and found that my father had the beginning of multi-infarct vascular dementia and that he’d had numerous tiny strokes and a possible secondary dementia: Alzheimer’s. Once I found doctors who understood the complexity of his brain chemistry, we were able to manage it with medications for the dementia (Aricept and later Exelon), aggression (Risperdal), and depression (Zoloft).

After much experimentation with combinations and dosages, the brain chemistry was properly balanced, without having to zombie him out. Then I started behavior modification on my eight-five year old father. By using “tough love” and “reward and consequences”, he learned how to behave and control his temper most of the time, even with the onset of dementia. When he is on good behavior he gets rewards of praise, affection, attention, and extra dessert works good too. When he is asserting his life-long need to control and boss people around, he gets negative consequences: no dessert, minimal communication, no attention, no affection. He has finally learned that there is no “pay-off” for pounding his fists and screaming and yelling. He will not get his way… period, and no one cowers. We walk away 100% of the time.

The next piece of the puzzle was to get him busy by going to Adult Day Care with my mother. By having daily mental stimulation, physical exercise, proper nutrition and social interaction, he finally had a reason to get up in the morning. Now instead of being a “sundowner” and up all night reeking havoc, he is tired out all day with fun activities and will sleep through the night, which allows everyone else to sleep also.

After turning around a seemingly impossible situation, I decided to write a book about it to help others who are trying to manage “challenging” elders. The result: Elder Rage or, Take My Father… Please! How to Survive Caring For Aging Parents.” Written with a humors tone, people learn to identify the earliest warning signs of dementia, which are very intermittent. Life-long behavior patterns start to get distorted.

I stress that the use of medications can slow the dementia down from progressing as fast as it would otherwise, keeping a loved one in Stage One an extra 2-4 years. Statistically families wait four years before reaching out for help, usually after a crisis, but by then the loved one is already in Stage Two, which requires full-time care. This is going to cost a lot of money and heartache.

Having Long-Term Care Insurance is the answer for the financial impact of caring for someone with dementia. Once there is a record of “memory loss” in a person’s medical chart, Long-Term Care Insurance will be denied.

By being sensitive to the early warning signs, getting to the right doctors, getting the right combination of medications and understanding that demented does not means stupid, many of these disruptive behaviors can be managed. The bottom line message is that there can still be a good life after a diagnosis of dementia if it is properly managed medically and behaviorally.

Ten Warning Signs of Alzheimer’s Disease
Reprinted with permission of the Alzheimer’s Association of Orange County.

1. Recent memory loss that affects job skills.
   It’s normal to occasionally forget assignments, colleagues’ names, or a business associate’s telephone number and remember them later. Those with dementia, such a Alzheimer’s disease, may forget things more often, and not remember them later.
2. Difficulty performing familiar tasks.
   Busy people can be so distracted from time to time that they may leave the carrots on the stove and only remember to serve them at the end of the meal. People with Alzheimer’s disease could prepare a meal and not only forget to serve it, but also forget they made it.
3. Problems with language.
   Everyone has trouble finding the right word sometimes, but a person with Alzheimer’s disease may forget simple words or substitute inappropriate words, making his or her sentence incomprehensible.
4. Disorientation of time and place.
   It’s normal to forget the day of the week or your destination for a moment. But people with Alzheimer’s disease can become lost on their own street, not knowing where they are, how they got there or how to get back home.
5. Poor or decreased judgment.
   People can become so immersed in an activity that they temporarily forget the child they’re watching. People with Alzheimer’s disease could forget entirely the child under their care. They may also dress inappropriately, wearing several shirts or blouses.
6. Problems with abstract thinking.
   Balancing a checkbook may be disconcerting when the task is more complicated than usual. Someone with Alzheimer’s disease could forget completely what the numbers are and what needs to be done with them.
7. Misplacing things.
   Anyone can temporarily misplace a wallet or keys. A person with Alzheimer’s disease may put things in inappropriate places: an iron in the freezer, or a wristwatch in the sugar bowl.
8. Changes in mood or behavior.
   Everyone becomes sad or moody from time to time. Someone with Alzheimer’s disease can exhibit rapid mood swings from calm to tears to anger for no apparent reason.
9. Changes in personality.
   People’s personalities ordinarily change somewhat with age. But a person with Alzheimer’s disease can change drastically, becoming extremely confused, suspicious, or fearful.
10. Loss of initiative.
    It’s normal to tire of housework, business activities, or social obligations, but most people regain their initiative. The person with Alzheimer’s disease may become very passive and require cues and prompting to become involved.

HOW IS ALZHEIMER’S DIAGNOSED?

There is no single diagnostic test for Alzheimer’s Disease. Instead, AD is diagnosed by comparing a series of test results and exams including: a thorough medical history, assessment of mental status, physical exam, neurological exam, lab tests including an EEG and brain scan, such as a CT, MRI, PET, or SPECT, psychiatric and other exams. A diagnosis of Alzheimer’s disease through this evaluation is considered 80-90% accurate. The only way to be absolutely certain is through an autopsy.

I spent a lot of time over the last day or two watching cable news and the feeling I got was that it’s over. Close up the shop because the US economy is about to enter a recession or even a depression. Even congressmen were using the dreaded ‘D” word, irresponsibly I may add. But is it really time to throw in the towel and declare the end of America as we know it? Is this just a ploy by the media to scare Americans into voting for a Messiah, who will then save the country from itself?

There is no question that the economy has some problems, namely a credit crunch, but Sec. Paulson’s plan will help relieve the crunch and open up credit flow. If you examine the economic data, we aren’t even close to the average recession. The amount of job loss pales in comparison to average job loss in recessionary times. the amount of banks that close is negligible compared to the hundreds that close during recessions. And I could go on and on. So why isn’t ‘main-street’ getting this information? Anyone notice that the usage of ‘main-street’ has taken on a life of its own?

What’s scary is the Democratic plan to save humanity. Capping salaries of private company CEO’s is not only illegal, but will scare them off from trying to purchase ‘toxic’ assets. Larry Kudlow had a brilliant point on the matter. He said, “And then there’s the ownership question. Some Democrats want Uncle Sam to take an ownership position in all the selling and purchasing banks. This is nuts. In America, this is nothing but property confiscation. It also will sharply curb buyers of the distressed assets.
You think Henry Kravis or Steve Schwarzman are gonna take a salary cap and lose an ownership share of the private-equity funds they themselves created and built? They shouldn’t and they won’t. And these funds are crucial to the new process. The only banks that will sell in this over-regulatory environment are the absolute, near-bankruptcy turkeys.”

Right on! He goes on to say that in the case of Fannie and Freddie and other companies bailed out by the government that in those cases you can feel free to pay the CEO along the lines of a high salary bureaucrat, but not the CEO of private company.

I think everyone needs to take a deep breath and get a bit of perspective. Things aren’t as bad as they are being made out to be. Pass Paulson’s plan, and allow the market to work the problems. My gut feeling is that if we do that, we are going to be in fro a bigtime economic boom.

Please see our Disclaimer HERE.

Aaron Katsman is Managing Editor of the Israel Opportunity Investor newsletter. He is lead portfolio manager for the Israel Growth Portfolio and Managing Director of America Israel Investment Associates, LLC. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email aaron@profile-financial.com.

Although we often hear about the “wonders” of compound interest, many people don’t know what it actually means and they miss out on its benefits.

Two quotes are attributed to Albert Einstein regarding compound interest. Einstein apparently referred to compound interest as “the greatest mathematical discovery of all time,” and on another occasion he claimed that it was the “eighth wonder of the world.” Although we don’t know if these quotes are accurate, there is definitely something magical about compound interest.

What is it?
Compound interest is the ability of an asset to generate earnings, which are then reinvested in order to generate their own income. In other words, the term “compounding” refers to generating earnings from previous earnings. The magic of compound interest transforms your hard-earned money into a very efficient tool for building long-term capital. For compounding to really work, however, it is necessary to reinvest all earnings over time. When an investor gives more time to his investments, he is more likely to optimize the income potential of the original sum.

Example
If an investor had $5,000 in an account that paid 5% annually in simple interest for five years, he would earn $250 a year. This would generate a total of $1,250 in interest. In this case, the interest rate and the yield are the same — 5% per year.
However, the same $5,000 investment paying 5% in compound interest could earn more. In this situation, if the money is reinvested and compounded annually for five years, it would produce a total of $1,381.41 in interest. This is because when the investor earns interest on his interest, the yield — an average of 5.52% per year — is higher than the actual interest rate at which he initially invested. This difference of 0.52% a year may seem insignificant, but we should also consider that the investor did not need to work to receive this money. Moreover, this half a percent could make a significant difference over a longer period, such as 20 or 30 years.
The Earlier the Better
When an investor starts investing at a younger age, he will benefit far more from compounding. To understand this further, let’s take the case of two investors named Tzivia and Moshe Aryeh, who are both the same age. When Tzivia was 25, she invested $15,000 at an interest rate of 5.5%, which was compounded annually. By the time Tzivia reached 50, she had $57,200 in her bank account.

Moshe Aryeh, on the other hand, did not start investing until he reached the age of 35. At that time, he invested $15,000 at the same interest rate of 5.5% compounded annually. By the time Moshe Aryeh reached 50, he had just $33,487 in his bank account.

What happened? Both Tzivia and Moshe Aryeh are 50 years old, and both invested the same amount of money ($15,000) at the same rate of interest (5.5%). However, Tzivia had $23,713 ($57,200 – $33,487) more in her savings account than Moshe Aryeh, even though he invested the same amount of money! By giving her investment more time to grow, Tzivia earned a total of $42,200 in interest while Moshe Aryeh earned only $18,487.

Annual Contributions
The above example clearly demonstrates the positive benefits of compound interest. Taking it a step further, imagine that Tzivia, who invested $15,000 at the age of 25, also adds an extra $2,000 a year to her account, where everything is invested at a rate of 5.5%. If she were to continue this disciplined investment approach until retirement (at the age of 65) she would end up with over $413,000. And if Tzivia were to add some risk to her investment profile in the hope of getting an even higher return, her nest egg at retirement could grow even more substantially.
The Cost of Waiting
As mentioned earlier, the two essential aspects for compounding to work are reinvesting the earnings and time. Each year that goes by without any investment will therefore affect your retirement. If you have 30-40 years until retirement, every year that you forego saving or investing money today may subtract between 1-5 years from your retirement.

Just Start
You don’t have to be wealthy to start investing. If you start saving early and make disciplined contributions, compounding may mean that you, too, can retire with a very large nest egg.
 

Aaron Katsman is President of Global Investments at Profile Investment Services.  He is a licensed financial professional both in the U.S. and Israel, and helps people who open investment accounts in the U.S. Securities which are offered through Portfolio Resources Group, Inc. a registered broker dealer, Member FINRA, SIPC, MSRB, SIFMA. For more information email aaron@profile-financial.com

For the past nine months or more, most business news reports will tell you that the global stock markets are down again. However, although the media tend to play this up, it is in fact nothing unusual. Generally, though past performance is no guarantee of future returns, markets have a few good years, followed by a less-than-stellar year or two. For example, in the current market cycle, there were four or five good years, and now the markets have dropped. That’s precisely why investors in the stock market need a long-term horizon, as well as to be able to withstand all of the market ups and downs. Below are three investing tips that may help investors remain sane during market downturns:

Diversify
To understand this concept more easily, we first need to define the meaning of diversification. Diversification is an investment technique that uses many varied investments within a single portfolio. The idea behind it is that a portfolio of different kinds of investments may, on average, yield higher returns and pose a lower risk than a single investment. Diversification tries to smooth out volatility in a portfolio caused by market, interest rate, currency and geopolitical risks. In laymen’s terms, don’t put all your eggs in one basket. It’s important to remember that diversification does not assure against a loss.

If you include bonds or FDIC-insured Certificates of Deposit (CDs) in your stock portfolio, it may take away some of the volatility of the portfolio, allowing for potentially, more stable returns over the long run.

Don’t Panic
Keep you eyes glued to your long-term goals. It’s important to remember that markets go up and down, and if you made a financial plan, it would have taken this type of market volatility into account. The worst thing you can do as an investor is panic and sell everything and then wait for the market to recover. The market tends to recover very quickly. Large market gains often come about in quick and unpredictable spurts, and missing just a few days of strong market returns can substantially erode long-term performance. Remember the famous investing principle of buying low and selling high. Investors who panic often end up selling low.

Rebalance
The third principle is for investors to update or rebalance their investment portfolios.  Rebalancing is necessary for two main reasons. First of all, it keeps your asset allocation in line with your risk level and, secondly, it keeps your portfolio in line with both your short- and long-term goals and needs.

Let’s use the following example: When you first decide to invest, you decide that an allocation of 70% stocks and 30% bonds seems right for your $100,000 portfolio. We can also assume that over the course of the past few years, the stock market moved up strongly, and bonds barely moved up at all.

Based on the assumption that all gains and dividends were reinvested, and you didn’t deposit or withdraw any money, you would find that the stock portion of the portfolio would be worth a lot more than the initial $70,000. On the other hand, your bond holdings would be worth little more than the $30,000 invested in them.

However, while it is true that over the last few years your portfolio in this case would have grown, it would unfortunately have also become riskier. The reason for this is because the portfolio would move from being a 70% stock and 30% bond allocation to an allocation of 80% stocks and 20% bonds.

In this situation, if you don’t rebalance and you have a riskier portfolio, when the market starts to drop, this could lead to a greater loss.  It is a good idea to implement these three tips, as they are a possible means to help you weather the storm of volatile markets.
Past performance is not a reliable indicator of future results. The S&P 500 index measures large-cap stocks and US stock market performance of leading companies in leading industries. An investor can not invest directly in an index.

Aaron Katsman is President of Global Investments at Profile Investment Services. He is a licensed financial professional both in the United States and Israel, and helps people who open investment accounts in the U.S. Securities are offered through Portfolio Resources Group, Inc. a registered broker dealer, Member FINRA, SIPC, SIA. For more information, email aaron@profile-financial.com