December 21, 2016

Five Years In

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It was around November of 2011 that the idea for 2MuchCents popped into my head. I had just assisted a client in gaining clarity and confidence around their financial situation, and it felt good. I saw their light bulb go on. I saw the burden fall off their shoulders. They were appreciative. I was also satisfied, and I felt like I might have just figured out what I was put on this earth to do as a professional. My desire to see more light bulbs go on with financial clarity and more burdens lessened with financial confidence, coupled with my hunger to help my family, my friends, and others, mixed with a dash of my frustration with the large amounts of arrogantly written and unnecessarily complicated personal financial literature out in the world led me to launch 2MuchCents.

Five years, 178 posts, and over 61,000 unique views later, I’m proud to say 2MuchCents continues on! I thought I might try my hand at blogging for a year, but I never thought it would turn into this. Today, as some of you celebrate five years’ worth of 2MuchCents with me, I want to share a few thoughts.

First, in case you missed them, the five most popular posts of all time to this point are:
  1. The Jr. Bacon Cheeseburger Postulate
  2. Roth vs. Traditional
  3. The Homemaker Retirement Plan
  4. How to Save for a Vacation
  5. Per Stirpes or Bust
Second, for 2016, my three “biggest hits” were:
  1. Investing in Experiences
  2. Brexit: European Disunion
  3. Money Mistakes We All Make
Third, I wanted to offer you a preview of some of my upcoming posts. I’m already working on topics such as the best piece of financial advice people have ever received, what you need to do to be a millionaire, and why losses do not equal gains. I hope you’ll check them out!

Thank you to Kenny Wuerstlin, Andrew Davis, Ryan Halpern, and my wife for their help all these years. I could not have done or continue to do this blog without them.

Thank you, too, for reading! Please keep subscribing, following, sharing, and most importantly, letting me know any questions you may have or topics you would like for me to write about. Your questions and topics fuel many of my posts!

Happy holidays to you and your family! I hope 2017 will be a good year!


December 15, 2016

What You Should Do With More

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Earlier this fall the U.S. Census Bureau released exciting data showing that real median household income grew an average of 5.2% in 2015 versus 2014. This represented the first statistically significant increase in income for the middle class since 2007. For the first time in almost a decade, most people have gotten a raise! This good news coupled with it being near the end of the year when sometimes employees are lucky enough to get a raise or a holiday bonus got me thinking that it might not be a bad time to suggest some things you might want to do with your additional income.

If you are fortunate enough to have additional income coming in, in general, here is what I would recommend you do, and in this order:
  1. If you are getting a raise, do a little math and see how much more money you will be bringing in each pay period after taxes. That is valuable information to know as you consider your budget going forward.
  2. Have some fun! Sure, I’m a numbers guy and a financial advisor, but I also know you only live once. Celebrate your hard work paying off and go eat at that new Italian place, buy that outfit you’ve had your eye on, or get that latest device. Now I’m certainly not suggesting you should blow all of your additional income, but I do think you should live just a little.
  3. If your cash rainy day / emergency fund is still not up to at least 3-6 months’ worth of your living expenses, it’s probably a good idea to direct your additional income to rectifying the situation. It’s not an exciting use of assets, but trust me, you will be glad you have a cash safety net in place when life throws you a curveball, and it will!
  4. As long as your modified adjusted gross income (MAGI) is below $132,000 if you are single or $194,000 if you are married and file a joint tax return, you should be eligible to contribute up to $5,500 to a Roth IRA ($6,500 if you are over age 50). This is a great way to save for retirement, and with any luck, your savings will compound over time into a larger tax-free asset.
  5. If you have any high-interest credit card debt or you are close to paying off a student loan or car loan and that will erase a fixed, monthly expense, I’d suggest you plow your additional income into your liabilities. It will save you interest expense and improve your financial situation.
  6. Top off your 401(k) or retirement plan. Unless you are already contributing the maximum amount, with additional income you should be able to contribute more to your retirement plan. This is a great way to boost your retirement savings and defer having to pay taxes on your additional income until you withdrawal money from your retirement plan later on.
  7. Put some extra towards your mortgage or other long-term debt. Again, it’s not an exciting use of your assets, but it will save you interest expense and speed up your progress towards being debt-free!
  8. If you are already charitably inclined, consider paying it forward and using your additional income for enhanced charitable giving, greater support of a cause you feel passionately about, or just helping out someone who you know could use a little help.
They say with more power comes greater responsibility. I agree, but I’d also say with more income comes greater possibility! If you are fortunate enough to have experienced a bump in your income or know you are about to get a raise or a bonus, use it thoughtfully. Have a little bit of fun, but also make it count!

October 31, 2016

We Got Trouble?

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In the Broadway musical The Music Man, one of the most famous songs is called “Ya Got Trouble?” During the song, a smooth-talking con man named Harold Hill tries to convince River City, Iowa locals that they need to give him money for band uniforms and instruments so that he can put together a marching band for the young people and protect them from the debauchery of a pool hall. I’m no con man, and I’m not asking for money for a marching band, but I’m sad to say my words today sound a little like Professor Harold Hill’s in the sense that I think we might be about to be in for some trouble, right here in the good ‘ole US of A.

You see, for many employees and retirees, open enrollment is about to begin, and for people insured through the Health Insurance Marketplace, open enrollment starts November 1st. And the word on the street is not good. I have read numerous pieces from typically liberal-leaning and typically conservative-leaning outlets and I've listened to multiple industry experts talk about 2017 health insurance coverage, and they all seem to be saying the same basic thing: brace yourself. The number of insurance carriers is going down, the number of plans available is going down, and the quality of coverage seems to be going down while the cost of coverage is going up, considerably. Last week some of this projected trouble came to fruition as the White House announced marketplace plan premiums will go up by an average of 25% in 2017.

If you read my blog, you know I’m not often one to sound the alarm. I’m not sounding the alarm today either, but I am trying to get your attention. When your open enrollment packet comes, you need to treat it like you are a member of the bomb squad. Carefully analyze every detail of your situation and proceed only with extreme caution.

We’ll have to see what happens to your premium. We’ll have to see what happens to mine. For now, here are a few general thoughts:
  • If you get a scary letter that your plan doesn’t exist anymore, don’t panic. You’re just going to have to pick another one.
  • If your plan is discontinued, don’t assume you will roll into a similar plan. Likewise, if your plan is still available, don’t assume you will automatically be reenrolled. In some cases, insurance companies feel they are now better off if they don’t have you as a customer at all, so the days of them trying to keep you with some sort of automatic election or renewal may be over. Be careful. You need coverage.
  • A lot of deductible amounts are supposedly going to be higher. If you are looking at a lower deductible plan option, look closely. It may not be as favorable as it once was.
  • A lot of co-insurance percentages are supposedly going to be less, so read carefully.
  • If you are considering going to a lower coverage plan to try and minimize increased premiums or to actually try to reduce your premium, consider your financial situation if you have a major medical event. You could be setting yourself up to win the financial battle if you’re healthy, but lose the financial war if you get sick.
  • The length of covered physical therapy treatments is supposedly going to be reduced. Read the fine print, particularly if you are planning or expecting a surgery that will require extended physical therapy.
  • Some procedures now require other procedures in order to be covered. For example, you might need a CT scan, but it might only be covered if you first have an X-ray. I can personally attest to that little quirk, so read the fine print now, and if the time to use your coverage comes, ask a lot of questions, work with your doctor, and be proactive with your health insurance provider to make sure you play the game as best as you can to reduce your out-of-pocket expenses.
  • If you are considering changing health insurance providers or plans, make sure your doctors you really like are still going to be willing to see you. A trusted, experienced physician might be worth a little higher premium if you can still see them.
  • If you are a retiree and your old employer has always paid your health insurance premiums, you might want to look into how much longer that is going to be the case. With the premium increases of recent years, the expected premium increases in 2017, and the projected premium increases going forward, many companies are beginning to pass some of the health insurance coverage burden to their retirees.
  • If your deductible or maximum out of pocket figure is greater than your cash on hand and rainy day fund, it may be time to boost those up so you can remain financially solvent even if you get hit with a real medical issue.
I’m truly sorry I can’t offer you something more concrete. I just want to warn you about the common tremors I am hearing from media sources that rarely agree. I hope I’m wrong, I hope there’s no trouble in River City, and I hope I can just go play pool!


October 27, 2016

How Much Insurance Do You Need?

Although I don’t sell any type of insurance, I do frequently offer to examine my client’s life insurance policies, disability insurance policies, homeowner’s policies, auto policies, and umbrella policies. Proper risk mitigation is a huge part of a complete and well-executed financial strategy, so I always want to make sure my clients are adequately protected. Often after my examination and analysis I am able to give my clients additional confidence in how they are insured, but there are times where some work needs to be done. Everyone’s situation is unique and there are tons of different types of insurance policies out there, but I would still like to share a few tips and general thoughts that I hope you will find helpful.

How much life insurance do you need? Tell me when you’re going to die and what kind of lifestyle you want your survivors to have and we can talk, but there are some real deep, personal questions to think through, too. Most people wouldn’t want their surviving spouse to starve or the house to be foreclosed on, but do you want to leave so much that your surviving spouse and the infamous pool boy can fill the pool with cash? I typically advise each working spouse to have enough life insurance to pay off all debt plus a little extra to allow flexibility and comfort while the grieving takes place, emotional and financial. I often times see a non-working spouse with young kids (who is doing plenty of work at home!) with no life insurance coverage at all. If the non-working spouse raising the young kids passes away, the working spouse probably can’t financially afford to swap places, so some sort of insurance on the non-working spouse to cover daycare and nanny expenses is worth factoring in. If you have children, it’s also wise to factor in other future expenses such as college expenses and wedding expenses and adding on enough insurance coverage to make sure those items would be funded and covered as well.

How much disability insurance do you need? Well, in my opinion, Yogi Berra wasn’t that far off in Aflac’s commercial when he said you want disability coverage so that “If you get hurt and miss work, it won’t hurt to miss work.” I’m more along the lines of you want enough coverage so that if you get hurt and miss work, it won’t hurt too much to miss work. In many cases you could tighten the belt and make things work if your disability income was not your normal income, but you need to make sure you have enough disability benefits and for long enough so that you could cover your fixed expenses and still maintain a tolerable lifestyle. One other thing, if you can pay for your disability insurance with after-tax dollars (most employers take money out pre-tax), I would recommend you do so. If you’ve paid for disability insurance with after-tax dollars and you do end up getting hurt, you won’t ever have to pay income tax on your disability income!  If you paid with pre-tax dollars, you will. Double whammy!

How much home insurance do you need? Think how much would it cost to rebuild my home?  This usually goes up over time even if your house’s value stays about the same. If your home value appreciates over time, you really should keep a close eye on your coverage and discuss with your agent from time to time. You should also factor in things like the value of your furniture, clothes, jewelry and how much it might cost you to temporarily live somewhere else while your home is repaired or rebuilt. Flood insurance, earthquake insurance, identity theft insurance, and specific belonging coverage (like for an engagement ring) can be added and should also be considered. If you think you only have home insurance in place below or equal to the value of what makes up your home, you may want to give your agent a call.

How much auto insurance do you need? If you get an umbrella policy (see below), this becomes a lot easier because the excess liability piece of your coverage considerations becomes a little less important. Still, you want a reasonable amount of coverage to cover the cost of medical injuries to multiple people and property damage. You might hit a Leaf with only one passenger or you might hit a BMW with 4 passengers. Also consider things like uninsured motorist coverage and windshield coverage that may or may not be adequately included in a base auto policy. I came across a pretty neat suggested auto insurance coverage calculator the other day put together by. It’s worth your checking out and comparing to what kind of auto policy you currently have in place!

How much umbrella insurance do you need? This excess liability coverage comes in multiples of a million dollars’ worth of extra liability coverage and usually only costs a few hundred dollars per million. Should you hit a school bus and the parents of the children on the bus find out you’ve been moderately successful, you’re going to want this coverage if you want to keep your stuff. And since the purpose of this coverage is to help you keep your stuff, you usually want as much coverage as you have stuff, rounded up to the next million.

It’s always better to have insurance coverage and not need it then to need it and not have it, but it can be expensive to have more coverage than you need. If it’s been a while since you’ve taken a look at the risk mitigation part of your financial plan, go kick the tires!


September 15, 2016

Insurance vs. Investments

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Not that long ago I had a meeting with a gentleman who candidly shared a frustration with me that I think is felt by many who interact with the insurance and brokerage worlds. The man told me that every time he expressed a desire to save a sizable amount of money for a new cause his insurance agent recommended a new life insurance policy and his broker recommended investing in new securities. The type of cause the man wanted to save up for and the timeframe never seemed to matter to the insurance agent or the broker. How could his insurance agent and his broker both be making the “right” recommendations?

What makes the feud between the insurance and investment industries so confusing is that neither side is necessarily wrong for trying to convince a consumer that they need what they are offering. There are plenty of really good life insurance agents out there. There are plenty of really good brokers out there. The thing is, there are times when what insurance agents are able to offer their clients may not be what is best for their clients versus investment accounts, and what brokers are able to offer their clients may not be what is best for their clients versus insurance policies. Essentially people have a “nail,” a desire to save money for a particular purpose, and they go to see two different types of “carpenters,” an insurance agent with an “insurance policy hammer” and a broker with an “investment hammer.” No matter the type of nail or the timeframe before the nail needs to be hammered in, each carpenter only knows to do one thing – use their particular hammer. As a Financial Advisor paid only by my clients, I don’t have any allegiance whatsoever to commission-based life insurance policies or commission-based investments, so I feel that puts me in the unique position of being able to serve as a neutral, third party for people such as the frustrated gentleman who find themselves caught in this age-old insurance versus investments fight. I believe that by focusing on the underlying reasons a person wants to save money and the relative timeframe before the person needs the money that I can determine whether it’s a job for life insurance or a job for investments.

Merriam-Webster defines insurance as “a means of guaranteeing protection or safety.” I tend to agree as I view life insurance as primarily a risk mitigation tool. If you are worried about your family having enough money to get by with a reasonable lifestyle, or you are trying to replace the loss of your future earnings if you prematurely pass away before your retirement years, a temporary risk mitigation tool commonly known as term life insurance is often the way to go. Because there is a temporary period of time when the insurance company might have to pay out benefits and it is relatively unlikely they will have to pay out benefits given most people’s life expectancies, this coverage tends to be relatively inexpensive. If you are worried about your heirs having enough liquidity to pay income or estate taxes after your death, or you are worried about having enough liquidity to buy out your deceased business partner’s share of the business from their heirs after their death, a permanent risk mitigation tool commonly known as whole life insurance is often the way to go. Because the insurance company is going to have to one day pay out benefits (as long as you keep covering the premium payments), this coverage tends to be pricier.

The issue of insurance versus investments usually arises when an insurance agent suggests that someone buy a whole life or universal life policy (essentially a whole life policy with a savings element) as a savings mechanism because part of your premiums can be invested and can later be borrowed tax-free and you aren’t just “throwing money away” like you might be doing if you go with a term policy and don’t happen to be “lucky enough” to die during the term. The problems with that typical pitch are that the money you invest is usually subject to very high fees (including investment management expenses and fees to the insurance company which can eat up the before-fee returns guaranteed by the financial solvency of the insurance company), and if you do decide to one day borrow from your policy, you will create a policy loan that starts charging you interest at usually a fairly high rate and can start eating away at your policy’s ability to remain in-force. Not throwing money away on a term policy you might never use really does sound appealing at first, but what about all that additional money you are using up year after year paying those higher whole life insurance premiums that could be invested, could appreciate, and could be used while you are actually alive?

Now to this point I’ve been pretty hard on insurance as an investment, but commission-based investments carry plenty of red flags in my book as well. How do you know a broker is investing in your best interest and not just to get their commission? How do you know they are not just trading or opening new accounts as frequently as they can to earn extra commissions at your expense? You are also going to be susceptible to the volatility and returns of the security or market you are invested in less the applicable investment management expenses, and if things don’t go well over a given time frame, that guaranteed investment return by the insurance company (even before all of their investment management expenses and fees to the insurance company) could end up looking pretty stable and pretty nice.

So what are you to do? Unless you have a real need for permanent life insurance, I typically recommend getting the less expensive term life insurance to mitigate the financial risk to your family of you dying before you reach your retirement years and investing the difference between the whole life insurance premiums and term life insurance premiums you saved with an investment advisor who is only paid by their clients. I’ve found this strategy often lets people get the most out of insurance and the most out of investing, at lower fees, while having more assets available for use during their lives.

I don’t see the complex debate surrounding the different saving strategies available to people through insurance and investments coming to an end any time soon, but before you decide which strategy is best for you, I’d definitely suggest you talk to somebody who has more than just one type of hammer in their toolbox.


August 31, 2016

Investing in Experiences

A few weeks ago my wife and I were fortunate enough to have the opportunity to sneak away to San Diego for a little vacation. It was wonderful. The perfect weather, the beautiful sunset cliffs, the carne asada fries… There simply aren’t words! Strictly financially speaking, we have absolutely nothing to show for it except for a few souvenirs and some credit card bills I’ve already eradicated, but the joy of the experience and the value of the memories made are definitely worth something.

I’m still relatively young, but I’ve got three decades under my belt, and that’s enough experience in this crazy game called life to have learned a few things. One of my biggest realizations is just how much more valuable an experience, like a trip, can be than most possessions.

Greek philosopher Democritus once said “Happiness resides not in possessions, and not in gold, happiness dwells in the soul." American novelist Nathaniel Hawthorne echoed the same sentiment a little more bluntly when he said “that a man's soul may be buried and perish under a dung-heap, or in a furrow field, just as well as under a pile of money." I couldn’t agree more and I think we should all pay close attention to Democritus and Nathaniel Hawthorne’s words.

The beauty of investing in experiences is you get so much more than you do with most purchases that are going to become obsolete, break, or become forgotten. Take our trip to San Diego for example. I got hours of enjoyment designing a trip where we could see as much of the city in a few days as we could as cost efficiently as possible. I got to anticipate potential itineraries in my head, altering them to make them as magical as I could. Once booked, my wife and I got to look forward to the trip for a couple of months. Once on the trip we got to savor the experiences themselves, and as the “travel agent,” I got the added satisfaction of seeing my wife enjoy the trip I had planned just as a chef enjoys watching someone clean their plate with a smile on their face. It’s only been a few weeks, but there have already been times where something has triggered a memory of San Diego and I’ve been able to smile and remember moments just to myself, share my thoughts with my wife, or compare adventures with others who have also visited that awesome city. How many physical possessions can you think of that bring that much joy?

A story I have shared with many people, and one of the saddest days of my career to this point, was the day when an elderly and somewhat miserly man emotionally asked me what the point was of all of his wealth. By all accounts this man had been blessed with a relatively happy life, but I have no doubt his life could have been fuller and his soul happier if he’d invested in a few less stocks and bonds and a few more experiences with his now deceased wife, now dwindling number of living friends, and now adult children.

I do have a few prized possessions, but it’s not my iPhone, my computer, or my television. Some of my most valuable possessions are certain pictures of my grandparents, my beloved Braves and Georgia Redcoat hats, a coffee mug, a train whistle, a baseball glove, a high school annual, a watch, a pocket knife, and some trip souvenirs. Isn’t it ironic that most of those items are the physical remnants of treasured experiences and memories that I am constantly trying to stoke so that they will continue to burn brightly in my head?

You need to have food, clothes, shelter, transportation, some possessions, a rainy day fund, and enough in a prudently invested portfolio to support your desired lifestyle. Poet, author, and philosopher Henry David Thoreau once said, “Wealth is the ability to truly experience life,” and although I was never that good at always getting what I was supposed to out of Thoreau and his Transcendentalism buddies, I think what he’s saying is that you have to have money in order to do stuff. Coco Chanel, a French fashion designer and businesswoman, put it best when she said “There are people who have money, and there are people who are rich.” Be rich. Invest in experiences.


August 12, 2016

Is Your Investment Advisor Doing the Hokey Pokey?

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Over the last few months I have had numerous conversations with people regarding their investment advisor’s dance moves. It seems that over the past year there has been a lot of “dancing” going on in some people’s portfolios. Something along the lines of you put your money in the market, you pull your money out of the market, you put your money in the market and move your investment strategy all about. If that has been your investment advisor’s tune or you self-manage your investments and that’s your typical jam, I have one word for you: stop.

A strategy largely based on putting your money in and out of the market is essentially a market timing strategy, and imperfect timing is a very common cause of poor investment performance. The truth is, no one is smart enough or consistent enough to successfully invest with a money in and money out approach over a long period of time. Sure, you can be lucky and look brilliant over a short period of time, but, even so, the transaction fees and short term capital gains taxes generated by jumping in and out of the market time and time again will also diminish your investment returns.

Most people know they need to have a large portion of their assets invested to have a good shot at hitting their retirement goals and to protect their hard-earned assets against inflation. Investors need an overall investment strategy that is historically appropriate for their age and stage in life, withdrawal needs, and risk tolerance. Beyond that, it’s my professional opinion that relatively small tactical adjustments are appropriate when there are specific opportunities or risks in the market or world that you’re trying to navigate, but drastic investment strategy changes should be the exception - not the rule. Sometimes taking action and making a lot of changes in your portfolio can feel good, but “surgery by chainsaw” rarely works out best. Instead, considering things like the amount of U.S. versus international stocks, large cap versus small cap stocks, growth versus value stocks, corporate versus municipal bonds, and long-term versus short-term bonds can be a good idea. 

Consider this year for example. Who knew 2016 would get off to one of the worst starts for a calendar year in market history? What if you’d completely jumped out of the market in February because you thought it was the beginning of the next cyclical pullback and you missed the bounce back of March, April, and May and endured transaction fees and realized capital gains? How many people actually thought Great Britain would vote to leave the European Union? What if you’d completely jumped out of the market in June due to the surprise result, media barrage, and overreaction of other investors and you missed the swift recovery and positive market performance since then?

When investing you shouldn’t make too many one-way, all-in bets. You should view investing as a mechanism to give you a high probability of achieving your financial and life goals. Investing is a marathon, not a sprint. It’s not sexy and it’s not news, but I do firmly believe investing in a prudently diversified portfolio with a long-term outlook really does give you the best chance to accumulate and preserve wealth.

After all, isn’t that what it’s all about?


June 24, 2016

Brexit: European Disunion

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Yesterday the United Kingdom (UK) held a highly publicized and anticipated referendum on whether Britain should leave or remain in the European Union (EU). After a voter turnout of nearly 72% with over 30 million ballots cast, Britain’s citizens voted to leave the EU. In light of this historic decision, I’d like to share a few thoughts.
  • This change does not happen immediately, and it is not going to be over quickly. Now that the “Brexit” decision to leave the EU has been made, Britain will have to formally notify the European Union that they will be withdrawing. This is done by invoking Article 50 of the Lisbon Treaty which is the constitutional basis of the European Union. Once triggered, Article 50 starts a two-year clock running where the terms of Britain’s exit will be negotiated between Britain and the 27 other member states, all of which have veto power over the conditions. The two-year period can be extended, but if no agreement is reached, the treaties and agreements that govern European Union member states will simply no longer apply to the United Kingdom. Article 50 has never been used, and the specific rules for exit from the EU are few, so this untested process will likely be lengthy and difficult.
  • The future of the EU may be more uncertain than the future of the UK. Despite all of the political, economic, and social uncertainties now facing the United Kingdom, at least they have chosen a path. The European Union has been riddled with one problem after another in recent years such as the European debt crisis with Greece and other member states, the Syrian, Afghani, and Iraqi refugee crisis, the uncertainty of what to do about Russia’s actions and posture in Ukraine, and now one of its very own member states choosing to leave. This has led to disagreements within the EU Parliament, within member states internally, and between member states. Italy, France, Holland, and Denmark are now all considering referendums of their own on whether they should leave or remain in the European Union, so the issue of whether the EU is beginning to disintegrate or whether it can reinvent itself to once again promote political, economic, and social harmony across Europe is the million-dollar question.
  • London may be hit harder economically than the rest of the UK. Many companies that do business with EU member states have major operations or headquarters in London. This is by design for a variety of reasons, but if Britain is no longer a part of the EU, some companies will have to consider if it would be better for their business to relocate those facilities to countries that are still members of the EU. What could be London’s loss could be Berlin’s, Brussels', Dublin’s, or Paris’ gain.
  • Scotland may want a do-over. In 2014 Scotland voted by a narrow margin of around 55% to 45% to remain part of the United Kingdom. Despite the overall UK voting to leave the EU yesterday, voters in Scotland wanted to remain part of the European Union to the tune of almost 62% to 38%. This division with most of the rest of the UK seems to already be feeding the fires for a second independence referendum from the United Kingdom. One has to wonder if Scotland became independent if they would try to rejoin the European Union.

The results of yesterday’s referendum were a surprise in most circles and create a tremendous amount of uncertainty. What will eventually happen to treaties? What will eventually happen to tariffs? What happens to EU member state citizens living and working in the UK? What happens to UK citizens living and working in EU member states? Surprise and uncertainty frequently cause volatility in investment markets, and we could very well be in for some turbulent times as the Brexit unfolds. Still, many international companies are going to keep selling their products in Europe, and people are going to keep needing them and buying them. European companies like Shell and BP are going to keep selling oil, Diamler, Fiat, and BMW are going to keep selling cars, Vodafone is going to keep selling telecommunication services, and Nestle is going to keep selling chocolate and consumer goods. In short, I certainly wouldn’t recommend someone be overly aggressive with European stock exposure at this time, but I also am not too worried about the entire continent sinking because Britain decided to return to complete independence as it had for hundreds of years before it joined the predecessor of the EU in 1973.

The next time you are at an airport, find an international flight coming in from a European Union member state and ask some passengers what they are. I bet you’ll hear things such as “French,” “German,” “Spanish,” and “Italian” as opposed to “A member of the European Union.” Yesterday, the United Kingdom did this very exercise and asked their citizens what they wanted to be. They voted “British.” I respect and understand the motivation behind the European Union and I believe it has done some good things in regards to keeping a lasting peace in Europe and allowing Europe to speak with a louder, collective voice. However, different countries with different cultures with different industries who probably still need different currencies does not necessarily sound like a lasting recipe to me.

Stay tuned.


June 21, 2016

Money Mistakes We All Make

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So many of my posts are suggestions and recommendations to do what is financially right. Today I thought I’d head in a different direction and highlight some common financial wrongs. Here is a list of seven of the most common money mistakes I’ve run into, and I’m sad to say I’ve even committed a few of these myself!

  • Not Considering the Financial Consequences of Student Loans: It’s so very easy to want to go to a certain college or institution or to get a specific degree, but will you really be able to get a job that pays enough to justify the expense? Far too many people sign up for mounds of student debt without considering the monthly debt payments and the length of those monthly debt payments versus their expected incomes when they are trying to decide what college to attend and what degree to obtain. It’s also important to make sure an advanced degree will equate to enough additional earnings to justify the expense.
  • Postpone Saving: If ends are meeting, but there’s not much leftover, it’s easy to fall into the rut of saying that you’ll start saving just as soon as you can. This is dangerous because life magically seems to always be getting more expensive. No matter your income or lifestyle, finding a way to save a little each month is really the only sure-fire way to get ahead and make financial progress towards your goals.
  • Too Much Car: Even after thoughtfully considering your finances and researching cars online, after taking a test drive at a dealership it is really easy to crave the better model with the premium wheels and entertainment package. Get what you need, not what you don’t. Additional money spent on a slightly nicer ride could go to a lot more critical financial goals such as establishing a rainy day fund or saving for retirement.
  • Rush to Buy a House / Too Much House / Furnish Too Well Too Quickly: Buying a home too quickly can really strain a person’s finances. The goal should not be to live like you want to eventually live when you retire; the goal should be to live. Just like buying too much car, buying too much house is also really easy to do. Being a new homeowner brings a list of new expenses, large monthly mortgage payments can be daunting, and you can’t always count on the price of real estate going up. As you are furnishing a house it’s important to go at a reasonable pace and decorate things as you can, not just a bunch of junk all at once or a bunch of fancy things that torpedo your cash or create recurring credit card debt. A new house doesn’t have to look like Pinterest or Southern Living overnight!
  • Children, but No Wills: Once you get married, you should probably have a will. Once you have kids, you should definitely have a will! A will is how you name guardians for your children, and even though it is the last thing you probably want to do between sleepless nights and sippy cups, it needs to be done. Wills also help make sure your spouse is looked after and your final wishes will actually be fulfilled.
  • Being Too Risky / Getting Too Defensive: So much is written, and rightfully so, about investors who get too risky and end up losing large portions of their investment portfolios. I won’t pile on further to that rant today, but I will offer that I think there should probably be a little more written about investors who get too defensive and end up spending down their assets and losing their purchasing power because their portfolios don’t generate enough growth. Portfolio growth is a function of interest, dividends, and appreciation; interest and dividends alone may not be enough to help you maintain your lifestyle.
  • Waiting Too Long To Move on Your Own Terms: Very few people want to move to the smaller house, the retirement center, or the skilled nursing facility, but there’s a lot to be said for moving when you can versus moving when you have to. Although often an emotional decision and process for the mover(s) and their family, doing so at your own pace and at your own accord is often a lot smoother and more dignified than waiting for a fall or other “triggering event.”

We all make mistakes, but now there’s no reason for you to make these!


June 02, 2016

Best Financially or Best For You?

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Some people might think my job is to make my clients as much money as possible. Some people might think my job is to make my clients the highest rate of return on their investments as possible. Generating investment returns within a client-agreed-upon degree of risk is the job of an investment advisor, but as a wealth advisor, my job is two-fold. Not only do I serve as my client’s investment advisor, I’m also charged with being my client’s financial advisor. Of course, I’m always plenty focused on investment strategy, but I’m simultaneously focused on helping my clients get what they want out of their lives.

For example:
  • How much cash should you hold? From a strictly financial perspective, conventional wisdom says three to six months’ worth of living expenses if you’re still working and one years’ worth of living expenses or more if you are retired. That is my baseline recommendation with my clients, too, but if you find yourself constantly worked up about what is going on in the world and holding a little more cash would lead to less stress during the day and better dreams at night, then go for it! It’s not necessarily best financially, but it may be best for you.
  • How should your portfolio be allocated? Based on an investor’s age, stage in life, and withdrawal requirements, historical return patterns generally lead most good investment advisors to roughly the same recommended allocation, but what if bear markets cause you indigestion and angst to almost a medical level? Given current interest rates and bond yields, it is absolutely critical to have enough allocated to stocks to have a chance to sustain or grow a portfolio over the long-term and to have a shot at protecting your purchasing power against inflation, but within reason, if your indigestion and angst could be soothed by having a few more CDs and bonds and a few less stocks, then why not? It’s not necessarily best financially, but it may be best for you.
  • How much should you withdraw? Financially speaking, it’s rarely advised to withdraw unnecessarily from your investment assets, but if you don’t, what is going to happen?  You may end up with some slightly happier heirs?  Your favorite charity may one day receive a bigger check? So often I see people do everything in their power not to withdraw money from their hard-earned assets because they are trying to keep their nest egg as big as possible. Now if a client’s financial stability or financial security is even remotely endangered by a potential withdrawal or their rate of withdrawals, I certainly raise the issue, but there are times after people have shared their dreams with me where my advice is for them to simply spend some of their money. You’ve always wanted that sports car? Get the car. You’ve always wanted to take your entire family on a beach vacation? Take the vacation. You want to help your family financially now when they need it versus later after your death when they potentially won’t? Help your family now. You want to give a substantial gift to a charity or cause you support so you can see the impact? Give the gift. It’s not necessarily best financially, but it may be best for you.

In my opinion there are two kinds of returns: your return on your investments and your return on your life. I would advise that you always be reasonably cautious when it comes to your financial situation, but when it comes to your comfort, confidence, happiness, satisfaction, and fulfillment, strongly consider that what may be best for you may not always be best for you financially. Return on investment is important, but so is return on life!


May 17, 2016

When a Man Loves a Stock

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I was waiting to pick up a to-go order one night after work last week and I was still deep in thought about a recent client meeting. The tax planning and risk management portions of the meeting had gone very well, but I once again could not break through on the investment strategy piece. Despite repeated recommendations over numerous years to try and get this husband and wife to further diversify their portfolio, a vast majority of their net worth is still tied up in one particular stock. It was at that moment that an old song I happen to like came over the speakers: Percy Sledge’s “When a Man Loves a Woman.” Here is what I heard:

When a man loves a stock
Can't keep his mind on nothing else
He'll trade the world
For the good thing he's found

If holding the stock is bad he can't see it
The stock can do no wrong
Turn his back on his best friend
If he put the stock down
When a man loves a stock
Spend his very last dime
Trying to hold on to what he thinks he needs
He'd give up all his comforts
Sleep out in the rain
If things don’t turn out the way he thought it’d be
Well, this man loves a stock
He gave it almost everything he had
Trying to hold on to its precious dividend
I hope it don’t treat him bad!!!
When a man loves a stock
Down deep in his soul
The stock can bring him such misery
If the stock plays him for a fool
He's the last one to know
Loving eyes can't ever see…
Now with apologies to Percy, my thoughts and his lyrics got a little mixed up. Still, it is kind of uncanny how interchangeable “woman” and “stock” is, isn’t it?

Based on my experience I think it probably is safe to say that the degree of emotional attachment employees sometimes develop with their company’s stock, investors sometimes develop with the stock of companies headquartered in their state or region, and heirs sometimes develop with stocks they have inherited can only be rivaled by romantic crushes. No matter the stock, and no matter the consensus outlook on that particular stock, I always remind people with significant holdings in one or a couple of securities of companies like Enron, Wachovia, and General Motors. Anything can happen to the stock they love, and although concentration can sometimes lead to wealth accumulation, diversification certainly helps with wealth preservation.

Next time I will once again attempt to articulate the risk-adjusted advantages of a prudently diversified portfolio, but I may just have to make the next meeting a dinner meeting. Perhaps old Percy Sledge’s tune will come on again and resonate with my clients like it did for me. Here’s hoping, because loving eyes sometimes can’t see.


April 26, 2016

Is Your Arrow Aimed Too Low?

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I am by no means an archer, but I have shot a bow and arrow from time to time. In Boy Scouts I launched a few arrows as part of a merit badge, and as a college student I competed with my roommates as we slowly made the top of a Styrofoam cooler look like Swiss cheese striving for the bullseye. It was fun, but believe me when I tell you that you wouldn’t want me to be your William Tell!

As you might expect, aim is pretty important when it comes to a bow and arrow. Aim too low and you’ll never hit your target. Aim too high and you’ll overshoot your target. Many people view financial goals as targets, and I think the same principles apply. That’s why I’d like to share a few thoughts with you on the importance of aiming your financial arrows to actually hit your financial targets.

In my experience I’ve found that people usually have more concrete targets than they have arrows. Most people have a general idea where they want to go and they may even know when they want to get there, but they don't always know if they're headed for the bullseye. This is where financial planning comes in to make sure you are not just shooting in the dark.

I meet with many people in their 20's and 30's who are carrying around loads of student loans. They are usually making their monthly payments, and in some cases even putting extra towards their loans, but their payment arrows are often flying all over the place. They know they want to eliminate all student debt, but they aren’t using their arrows as efficiently as they could. By prioritizing paying down the loans with the higher interest rates rather than simply making the automatic payments that are based on the size of the loans, they can ultimately pay less interest and hit their debt-free target faster!

I also meet with lots of people who share with me their goal of paying for their children’s education. It’s an admirable and loving goal, but the problem is that sometimes I find that the parents need those funds for their own retirement. Sometimes I also find out that the "child" we are discussing is a senior in high school. Either way, saving is best done over time with small savings arrows, rather than with a last-second, giant contribution.

My bread and butter is meeting with people contemplating or nearing retirement. Most of the people are not comfortable or convinced that their nest egg, Social Security, and any retirement pensions or income they may have are enough to provide for their desired retirement lifestyle by their desired retirement date. Sometimes I find people’s expectations are pretty well lined up, but other times I find people's expectations way off. I’ve had to tell someone who hated their job that they actually could have retired much earlier because their savings arrows had been aimed so high. I’ve also had to tell someone who had practically cleaned out their desk that they weren’t headed to a beach anytime soon because their savings arrows had been aimed too low. A challenging, but much easier conversation for me (and whoever I’m advising) is sharing with someone several years out from retirement that they need to aim their savings arrows a little higher and push their realistic lifestyle target expectations in a few yards in order to make things work, or better yet, that they really are on target for their retirement bullseye or better.

Aim too high with your financial goals and you could be missing out on opportunities and experiences now. Aim too low with your financial goals and you might not pay off your debt in a timely fashion, you might not be able to send your child to college, and you might not be able to retire with the lifestyle you’ve always wanted. If your aim is just right, you're either incredibly lucky or you’ve done some financial planning.


April 07, 2016

Qualified Charitable Distributions

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If I were a betting man, I’d say there is probably a pretty good chance that you have recently put the finishing touches on your tax return. If I’m wrong, congratulations on getting your taxes done early! Your CPA thanks you, trust me. If I’m wrong because I just reminded you that your taxes are due on April 18th this year, save this post for later and make double sure that your CPA is filing you an extension!

Either way, while taxes are still likely fresh in your mind, I wanted to mention something to you for this year called Qualified Charitable Distributions. For those of us who do not like to type or write long words, we affectionately call them “QCDs.”

Qualified Charitable Distributions allow an IRA owner who is over age 70 ½ the opportunity to directly transfer up to $100,000 annually from an IRA to a qualified charity tax-free. QCDs are not new in the sense that they were created by Congress back in 2006 as part of the Pension Protection Act, but they have had a roller coaster history ever since. In the initial legislation, QCDs were only to exist for two years, and at the end of 2007, the opportunity to make QCDs was no more. QCDs became popular during that time period though, and almost every year since 2007, Congress hemmed and hawed over whether to bring them back each tax year or not. Some years they did, some years they didn’t, and some years they did retroactively (I wish I could do things retroactively…). To put it simply, it was a mess. Thankfully, as a result of the Consolidated Appropriations Act of 2016, QCDs are back, and for now at least, they are back permanently.

When a taxpayer makes a QCD, they don’t report taxable income for transferring money from their IRA and they don’t report a charitable deduction, either. It’s almost like it never happened for tax purposes. If a taxpayer just withdrew money from their IRA and donated it like normal, they would report the taxable income and they could take a charitable deduction. The taxpayer gets hit with the “stick” of the additional income, but receives the “carrot” of an additional deduction. So which should you do?

I’ll be honest with you, in most cases, the initial difference on your taxes from charitably gifting by making a QCD or not making a QCD usually appears pretty small, but that doesn’t mean you shouldn’t consider a QCD. By not having to report the additional income when you make a QCD, it’s possible you can avoid triggering or reduce the damage of some of the tax laws currently in place that penalize taxpayers. Charitably giving by making a QCD could reduce your income taxes on your Social Security benefits, it could reduce a phase-out of your itemized deductions, and it could keep your income under one of those heinous Medicare income thresholds so that your insurance premiums don’t increase. If you don’t have a lot of deductions and take the standard deduction instead of itemizing your deductions, a QCD is likely a good idea for you because otherwise you will be recognizing income and not having enough deductions to get any credit on your taxes.

I know that was a lot, and I’m sorry. I’m still a recovering CPA... My point is if you or someone you know is over age 70 ½, they have an IRA, and they are charitably inclined, make sure they ask their CPA about this new potentially tax-saving tool that we now permanently have in our taxpayer toolbox. Just do your CPA a favor, and ask them after April 18th!


March 08, 2016

What Fuels Your Fire?

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I love fires. There is something about them. They are exciting. They are always changing. They are magical.

I believe our lives are sort of like fires. Life can be exciting. Life is always changing. Life can be magical.

This leads me to a question I was recently asked at a conference I attended, and now I will ask you: What fuels your fire?

I view my fire as one of those nice three-log teepee fires. My “logs” are my faith, my family, and my friends. I have a number of other large “branches” that make up my personal fire including my health and my job. I also have a lot of “twigs” that serve as additional kindling such as my love of sports, music, and theatre, and hobbies I enjoy like reading, travelling, and cooking.

Perhaps your fire looks a lot like mine. Perhaps it doesn’t. Maybe you are a log cabin fire. Maybe you are a parallel fire. Maybe you are a star fire. Your fire is your own, and as long as you stay reasonably well fueled, your flame can remain lit. Just as an actual fire burns a lot better, brighter, and prettier when there are multiple pieces of wood contributing to the flame, I believe “life fires” work the same.

As a financial advisor, I frequently work with people as they navigate through major financial crossroads. The thing is, major financial crossroads typically occur at major life crossroads. Think retirement transition, birth of a child, dual-income to single-income transition, divorce, child going off to college, death of a loved one, etc. That means I don’t just have the opportunity to help people through financial crossroads; I have the opportunity and responsibility to help people through life crossroads. Unfortunately, I’ve found that many major financial/life crossroads involve a significant change in a “log,” “branch,” or a “twig” in my client’s personal fires.

What happens when you retire and your work log goes out? What happens to all your other logs if you gain a son or a daughter and add their log to your fire? What happens if you let your spouse log or a bunch of your friends go from a blaze to some barely glowing embers? What happens when a child leaves the nest or a loved one passes away and their log is removed from your fire? At best, the shape of your life fire changes, and at worst, your fire doesn’t glow as much as it used to, or as much as it could.

My expertise is financial, but my experience is financial and personal. It’s from that experience that I urge you to think about your personal life fire. I’ve seen too many fires get rocked by major life transitions. I’ve seen too many fires that burn dangerously reliant on a single log whether that be a job, a child, or a hobby. I’ve seen too many fires fall over when a log was added. I’ve seen too many fires fall over when a log was removed. I’ve even seen a few fires go out.

Your fire is yours, and yours alone, to tend, but I ask you to consider what your life fire would look like if it was an actual fire. You may need to add some kindling. You may need to revive a log. You may need to relight a log. You may need to snuff out a log. You may need to do nothing other than remain vigilant. I’d just suggest that you strive to make your personal fire resemble an actual fire that you’d be proud to sit around and make some s’mores.


February 12, 2016

Failing to Plan

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I don’t know about you, but the beginning of the year is when I usually do my greatest amount of planning. New Year’s resolutions, vacation itineraries, home improvement lists, and fitness routines can currently be found in my personal effects. Maybe I’m too rigid. Maybe I’m not spontaneous enough. What can I say? I need a plan of attack. Without one, I feel lost.

A lot of people I meet for the first time seem to view financial planning like a trip to the dentist. It’s not always fun, and you might not look forward to it, but it is necessary to keep your teeth clean and avoid a root canal. I’m no dentist, but I do firmly believe financial planning is necessary to accumulate and grow your assets, and to avoid the many financial potholes lurking around out there.
  • Consider someone facing the huge burden of paying for their child’s college tuition the next four years versus someone who started a 529 Plan for their child eighteen years ago.
  • Consider someone who wants to retire a year from now, but can’t possibly maintain their lifestyle in retirement versus someone who implemented a debt-reduction plan ten years ago so they could coast into retirement debt-free.
  • Consider someone who made a generous charitable contribution the year after they retired when they were in a low tax bracket versus someone who more strategically made a generous charitable contribution right before they retired when they were in a high tax bracket.
  • Consider the family of someone who is left in a coma after a tragic automobile accident with no estate plan in place versus the family of someone who took the time to execute a will, a Power of Attorney, and a Health Care Directive.
  • Consider the family of someone killed in an automobile accident who never wanted to bother with the health questionnaire for life insurance versus the family of someone who made sure their family would be financially secure in the worst of circumstances.
Oftentimes it is better to be lucky than good, but I’m not always that lucky. I need peace of mind and confidence in my family’s financial security. I’m a firm believer in Ben Franklin's famous words that "If you fail to plan, you are planning to fail."
Just as a dentist can help a toothache, people often come to me at a time of financial crisis like imminent retirement, unexpected termination, a surprise job offer, a birth, a health tragedy, a death, or a divorce. Yes, I can certainly help, but it’s much easier and there are so many more options if you plan ahead. Maybe it’s me, but I prefer flossing a little along the way and having a few checkups every year to a painful toothache and a drill!

February 02, 2016

Extra! Extra! Read All About It?

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I don’t know about you, but I prefer my sports teams winning versus losing, sunshine to rain, and the stock market trending upward as opposed to trending downward. I’m not sure the media does. Think about the coverage surrounding Mark Richt’s exit from UGA, the Braves’ rebuilding and relocating, and the Falcons’ collapse after starting 5-0. Think about the coverage every time we have tornadoes or, better yet, every time we might see a snowflake. Think about the coverage when the stock market is down a few hundred points in one trading day. There is so much more “breaking” news, so many more news alerts, smart phone notifications, and headlines that are shared when the news is bad. After one of the most volatile and negative months investors have experienced in several years, I’d like to ask you to briefly turn over your phone, mute your television, silence your radio, and turn off your computer for just a few minutes and look at the last ten bear markets with me.

A bear market is defined as a drop of at least 20% from the most recent market high. Below, is a pretty fascinating chart put together by J.P. Morgan showing the characteristics of the last ten bear markets (click on it).

As you can see, markets were down around 86% during the Great Depression. Markets were down 28% during the Cuban Missile Crisis. At a point during the 70s, and during the OPEC oil embargo, markets were down 48%. Markets were down 34% at a time in the 80s after Black Monday and the 1987 market crash. Markets were down 49% in the early 2000s when the tech bubble finally burst. Markets were down 57% during the Great Recession.

Folks, the S&P 500 was down about 5% in January and I’ve seen a whole host of headlines using phrases like “market crashes,” “market plummets,” and “investors robbed.” A catchy title or headline is obviously and purposefully trying to get you to buy a paper, watch the news show, or click a link, but I think it’s important to keep things in perspective.

On the right side of J.P. Morgan’s chart you may have also noticed some data on the bull markets or market recoveries. Markets roared back after the Great Depression, the Cold War, the inflation of the 70s, the Federal Reserve intervention in the 80s, the bursting of the tech bubble, and the Great Recession. On average, the last ten bear markets have been around a 45% pullback while the last eleven bull markets have been around a 151% pop!

Don’t get me wrong, I am concerned about a lot of things going on in the world, and I would not be surprised if market volatility continued. Inevitably, at some point, there is going to be another entry on the “bear side” of J.P. Morgan’s chart. Of course history also seems to offer there will then be another entry on the “bull side” of J.P. Morgan’s chart…

What am I telling people to do? The same things I’m always telling people to do! Make sure you have enough cash set aside to feel comfortable and for any large, upcoming expenses. Make sure that your portfolio is prudently diversified for your risk tolerance and age and stage in life. As hard as it is to accept, volatility is the friend of the long-term investor. The thing is, you have to stay buckled in during the down times in order to fully participate in the up times.

At the rate many media outlets are going, I really don’t know what phrases and terms they will use when we have our next bear market. I don’t know how far they’ll go to try and convince everyone that this time is different. I’ll continue to vigilantly monitor the markets, but don’t expect me to get caught up in some headline. I’m much more interested in focusing on the cataclysmic stinkage of my sports teams and the next allegedly imminent blizzard!


January 19, 2016

Continuing Care Retirement Communities

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Continuing Care Retirement Communities or CCRCs are becoming more and more common. CCRCs are retirement communities that offer different levels of service and health care at the same location or campus. Most CCRCs have apartments, cottages, or small houses, which allow healthier residents to experience a neighborhood feel while still enjoying access to the amenities (restaurants, gyms, libraries, clubs, etc.) of the larger campus. CCRCs also usually have smaller apartments or rooms for residents who need more assistance in addition to skilled nursing facilities and rehabilitation centers. The idea is to not have to move to multiple residences towards the end of one’s life, and to not have to be separated from a healthier or sicker spouse.

The growing popularity of CCRCs is due to a number of reasons. For one, residents want to keep their independence as long as possible and CCRCs allow them the flexibility to do so. CCRCs also allow many sick residents to stay with, or at least in the same facility as, their healthier spouse. Additionally, many residents either do not want to be a burden on their spouse or family, or simply do not have spouses or families that are able to handle the burden of care necessary to support them. With people living longer and longer, I would expect this trend to continue. I’ve already seen it as I have helped a growing number of clients transition themselves or their parents to CCRCs. It’s a big decision; emotionally and financially, and one that should not be taken lightly. In that spirit, I’d like to offer a few financial tips I’ve learned along the way.

  1. Know what you can do. As you might imagine, there are varying qualities of CCRCs with varying costs. It’s important to look at what your new living expenses would be and whether that is a feasible “burn rate” given your amount of assets and life expectancy. Many people have to sell their primary residence to make a move to a CCRC possible.
  2. Figure out your real estate options. If you need to sell your primary residence when moving into a CCRC, talk with the CCRC before making any decisions. In some cases they have people or relationships that can help you clean out and even sell a home at discounted rates. I’m talking estate sale experts, realtors, and mortgage brokers. Some CCRCs offer financing on a short term loan between the time you sell your primary residence and move in, but sometimes “outside” financing on a loan to bridge you between the sale of your old home and the purchase of your new CCRC home may be necessary.
  3. Consider refundable versus nonrefundable options. Some CCRCs charge you more up front, but promise to give your heirs a portion of your down payment back after you pass away or if you pass away within a certain period of time. Depending on the specific offer, your financial capabilities, and your life expectancy, there can be a strategic decision to be made here.
  4. Consult with a CPA. At certain CCRCs, a portion of your initial down payment can qualify as a medical deduction for income tax purposes. Ask any CCRC you are considering if this is the case, and then if so, talk with your CPA. A really large medical deduction might cause you to have a really low or negative income tax year in the year you move into a CCRC, so it may make sense to pull some income forward or recognize some extra income in such a year if possible. Perhaps the CCRC will let you pay the down payment over two tax years so you can spread out the deduction? A medical deduction for moving into a really nice CCRC can near six figures, so the tax planning on this isn’t something to just do yourself or with your generic tax software!
  5. Get on a waiting list sooner rather than later. There are more people interested in CCRCs than there are spots available. If you know there is a particular facility you are interested in or you have friends going into, inquire if there is a waiting list. Usually you can get on a waiting list for several hundred to a few thousand dollars that may even be refundable if you change your mind. You may not be able to get into the CCRC you want to when you need it if you don’t go ahead and get on the list beforehand!

As always, if I can be of assistance to you or someone in your family considering a move into a CCRC, please let me know. You know where to find me.


January 05, 2016

Unplugging from Work

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Happy New Year! I hope you and your loved ones had a wonderful Christmas and a special holiday season. I also hope you were able to unplug from work. Were you?

A CareerBuilder survey taken in July found some disturbing news. Almost one in five people acknowledged that they had no ability to unplug from the office. Almost one in five people said they had a tough time enjoying other activities because they were thinking about work. Almost one in four people admit to checking work emails during activities with family and friends. Almost one in four people said work is the last thing they think about before they go to bed. Almost two in five people said work is the first thing they think about when they awake. Now I’ll admit that after my alarm goes off Monday through Friday, I often strategize my work to-do list in the shower, but other than that, what is wrong with these people?

As the old adage goes, no one on their deathbed has ever said “I wish I had spent more time at the office.” I don’t know about you, but I work to live. I do not live to work. I enjoy and get fulfillment out of my job, but if I could be at the beach with my family or at the game with my friends, I would!

There have always been "workaholics," but thanks to good old technology, now it’s even harder to separate work and life. An article on Time's states that the Center for Creative Leadership found smartphone users spend an average of five hours on work emails each weekend, and a Glassdoor poll found more than 60% of people work during a vacation.

Look, I’m not advocating to slack off or not work hard, but I am advocating to work when you work and play when you play. I am advocating for building a moat between work and life. I am advocating for looking at things in terms of life/work balance and not work/life balance.

I once had a supervisor articulate that time off did not mean less work; it simply meant rearranging when you did the work. I’ve found that to be true, and a good way to look at vacation. Get all of your stuff done that has to be done before you go, work ahead as much as you can so you won’t be drowning when you come back, and then tell your boss and co-workers you’re gone and actually fall off the grid!

Let’s face it, though, despite your best efforts to leave everything tied up in a bow, something is probably going to hit the fan while you’re out. Who is going to address the issue? You if you don’t leave other people’s names, phone numbers, and emails who can pinch-hit for you on your auto response emails or your voicemail. And just say when you’re going to be back versus some line about periodically checking emails. Cut the cord!

There may also be times where you have to protect yourself if you are truly going to disconnect. If you get a text from a co-worker at an ungodly hour, don’t respond immediately unless you really have to. If someone emails you on the weekend and you happen to be working, don’t reply immediately unless it’s absolutely necessary. This can be a bit trickier, but if a client or customer starts trying to do business after hours, you may need to consider waiting to respond until normal business hours to really establish a boundary. If you always jump when the open sign is off, you are setting expectations that don’t allow you to ever unplug. Remember, if you give a mouse a cookie (or a co-worker or client an unnecessary response while on vacation), he or she is probably going to want a glass of milk!

Finally, if you are a smartphone user, may I make a recommendation? Turn off the “Badge App Icon” for your email under “Settings” and then “Notifications.” This will get rid of that evil little box that tells you how many unread emails you have. It’s liberating – trust me!

Occasionally I work at night, once in a blue moon I work some during a weekend, and ever so rarely I send a work text or a work email while on vacation, but for the most part, I unplug. There is a point where productivity and quality will suffer if you work enough hours. If you’re rested, you’ve had a little fun, your spouse is happy, you’ve spent some time with your family, and you have a few friends, you’ll actually be a better employee. I bet you’ll be a happier person, too!