Your “Silent” Partner

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I would like to tell you a few stories…

I’m meeting with a husband and wife and they’ve got some bonus money they’re trying to decide what to do with. I raise the question as to whether they’d like to pay off their mortgage or invest the funds and the husband quickly answers “Invest the funds!” The wife subtly looks out the window.

I’m meeting with a husband and wife and we’re reviewing their investment allocation. They have chosen to be a little more aggressive than I’d typically recommend for someone with their monthly withdrawal needs. I suggest they boost their personal cash accounts and increase their allocation to fixed income in their investment accounts while reducing their international stock and small cap stock exposure. The husband shakes his head before the words are barely out of my mouth and informs me that they’ll keep the pedal to the metal. The wife is suddenly interested in her shoes.

I’m meeting with a husband and wife and we’re going over how much they have saved in college savings accounts for their children’s upcoming college expense needs. I show them they have set enough to cover more than 4 years at most universities even though their kids aren’t sure where they want to go or if they will have any scholarships. The wife tells me their kids might just go to an Ivy League school, and she gets out her checkbook and starts writing checks to make some additional contributions to their children’s college savings accounts. The husband spontaneously becomes interested in his cell phone.

I’m meeting with a husband and wife and I suggest we examine their estate planning documents as it has been several years since they’ve been executed. I talk about the importance of making sure their wishes would still be fulfilled, but the wife says that won’t be necessary because it’s not fun to think about. The husband takes a sip of his water and awkwardly asks me what my expectations are for the market for the next twelve months.

The title of “husband” or “wife” is meaningless in this post. The subtly looking out the window, the sudden interest in one’s shoes, the spontaneous interest in one’s cell phone, and the awkward subject change are not. These body language cues, gestures, and reactions are significant.

In my experience as a financial advisor I’ve learned there is oftentimes a more vocal spouse. There is oftentimes a “CFO Spouse,” one that is more involved or interested in the family finances. There is nothing necessarily wrong with this norm, but I’ve also learned the value of engaging the less vocal, less-CFO spouse if they’ll let me. Sometimes they have questions that have gone unanswered and concerns that have gone unaddressed. As you may have surmised from the stories above, I’ve found cases when one spouse would sleep a lot better if their mortgage was paid off, one spouse would feel a lot better if they were a little more conservatively invested, one spouse would be in support of setting aside a little less for the kids, and one spouse would be more confident in their situation if certain difficult and time-consuming conversations were had.

I hope my words are food for thought and will serve as a good heads-up. As a financial advisor (and husband) I can tell you that if your spouse isn’t happy, nobody’s happy!

-Tom

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.

-Tom

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.

-Tom

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.

-Tom

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!

-Tom

Normal Investors - Familiarity

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Imagine you are just getting home after a very busy and stressful day at work. You just closed the door to the garage, dropped your bag on the couch, and are making your way up the stairs towards something you value deeply - comfortable clothes. Yep, there’s that old pair of jeans you wore yesterday. You know the ones with the slightly worn knee and the stretched out belt loop from where you like to rest your thumb? Best of all, they’re everso slightly stretched out from your wearing them yesterday. Don’t worry, I won’t tell anyone!

Of course there’s a similar feeling when you return home after travelling, whether for business or for pleasure. That moment after you’ve filled the laundry bin, returned your toothbrush to its normal spot, and have finally put up the suitcase. Oh it’s nice to see your shower, your couch, and most of all, your pillow! Wouldn’t you agree?

As you’ve undoubtedly gathered, I’m talking about familiarity. Whether a pair of comfortably worn jeans or your old friend of a pillow, familiarity feels good. It’s what you know. It’s what feels right. It’s what feels safe. Familiarity is also the third tendency that I present to you as a trait many normal investors have.

I would offer that many people go with what they know, especially when they are unsure of what is best. Consider some research done by Vanguard back in 2010 that found that Canadian investors were 65% invested in Canadian stocks, U.S. investors were 72% invested in U.S. stocks, and Australian investors were 74% invested in Australian stocks. Canadians, Americans, and Australians certainly have their differences, but do you really think the before mentioned investment allocations coincidentally showed that degree of “home bias?” I don’t. Investors were investing in what they felt they knew.

To take this a step further, let’s spend a moment on company stock. Regardless of the company, most people I come in contact with who work for publicly traded companies tend to own stock in their employers. Why? Do they think their company’s stock is going to really pop? Sometimes. And sometimes, they’re right, but sometimes they’re not. I’ve met many successful employees and successful investors who have a significant portion of their wealth in “their” company stock, and they desire to continue holding that stock even when they are no longer actively working for the company. Why? I think it’s because it’s easier for someone to feel safe investing in a company that they know a little about rather than the broader market which they may not know as well. Employers are aware of this, too, and that’s one reason employees are often incentivized with company stock in an attempt to align the employee’s financial success with the company’s future financial success and encourage hard and good work from employees.

(As an aside, I attended a lecture given by a professor from the Wharton Business School earlier this year, and he shared that a study was currently being done on what stocks were the hardest to get investors to diversify out of based on their location. #2 was supposedly getting a Seattle resident to sell some Microsoft stock (Microsoft is based in Seattle). Guess what #1 was? Getting stock in The Coca-Cola Company out of an Atlanta resident’s hands! Do any of my local readers here have any Coca-Cola stock? If you don’t, I bet you have friends and family who do!)

Familiarity feels good. Investing in companies that are based in your country is normal. Investing in the company you work for is normal. Investing in companies that are near and dear to your city or state is normal. However, you have to be careful when considering the investment risks of being overly concentrated in a single stock, a single sector, a single asset class, or a single country’s stocks. The risk-adjusted returns of a diversified portfolio are often still king. Going with what you know, what feels right, and what feels safe can be a crutch and a safety blanket, but what if your crutch was named Enron? What if you’re a Greek citizen and Greek companies are what you know? What if your paycheck was coming from Lehman Brothers, the pension benefit you were working for was guaranteed by Lehman Brothers, and most of the stock you owned was invested in Lehman Brothers stock? It’s normal to invest based on familiarity, but that may not always be best.

There’s nothing I hate more than when a grocery store I frequently visit decides to remodel. It’s frustrating. It doesn’t feel like it used to, I don’t understand the layout, and I don’t know where anything is, but I will get used to it. Eventually the new layout will feel familiar. Sort of like an investment portfolio that has recently been adequately and prudently diversified, eventually the new layout will feel familiar.

-Tom

Next up: overconfidence

Stumped!

It was slightly more than a routine trip to the vet, but it was not supposed to be a big deal. Our dachshund, Miss Lucy Bristow, was going in for her five-year dental cleaning and some X-rays. Sure, it wasn’t a “normal” visit, but I wasn’t ready for what was coming my way. I wasn’t prepared for the financial question on page two of the obligatory paperwork. It read something to the effect of:

Should your pet experience a life-threatening injury or illness, every effort will be made to reach you. However, if you are unable to be reached, you authorize $__________ worth of treatment/services/materials to be performed/used by the veterinary practice in an effort to save your pet’s life.

Woah! What a question! I may help people with their finances for a living, but I’ll be honest with you, at that moment, with an unexpected question like that, I didn’t have a clue. I was stumped! To make matters worse, I knew my wife was tied up in a client presentation. This decision would be mine and mine alone.

In my efforts to stall so I could regain some composure, do some soul searching, crunch a few numbers, and consider what my wife might do to me if something were to happen to Lucy and I didn’t put quite a big enough number in that giant blank space, I asked one of the nurses what people usually put. She laughed and said, “It’s a tough question, isn’t it?” I nodded. She said she had seen everything from $0 to $15,000! Woah again! Still, I was relieved to hear her words as the number I was considering was definitely between the two she offered.

I tell you this story for two reasons: 1) So if you are a pet owner you can go ahead and be thinking of your answer should you ever be asked that question and 2) To make the point that there are some really hard financial questions out there that you need to be able to tackle. Questions such as:

• Can you afford that bigger house?
• Can you afford for one of you to quit working?
• How much auto, home, life, disability, long-term care, and liability insurance do you need?
• Are you saving enough for retirement?
• Can you retire?
• How much can you afford to spend?
• Who should be your Power of Attorney?
• How would your assets be distributed if you passed away tomorrow?

Sometimes life throws you a financial surprise (like a blank space on a veterinary form), and it’s okay to be temporarily stumped. Take a deep breath, think through your options, talk to a clear-headed, neutral third party if need be, and figure it out. Other tough financial questions are the “five-hundred-pound gorillas in the room” until they are answered. I’d suggest you go ahead, bite the bullet, and answer those. Knowing how you are doing is important. Knowing what you can afford to do and not do is important. Knowing all would be financially okay for your loved ones if something happened to you is important. Those questions can and should be answered.

I finally gave the nurse a number. Later, when I was telling this story to my wife and asking her what she would have put, I found out that our numbers were actually really close, but mine was a little higher. Whew! Either way, I’m happy to report Lucy came out just fine, and that’s what matters!

-Tom

Why You Need to Rebalance



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Suppose you invested $100,000 on January 1st, 1995. You invested $50,000 in the Barclays U.S. Aggregate Bond Index and $50,000 in the S&P 500 (U.S. stocks). Between January 1st, 1995 and December 31st, 2002, you were in for quite a ride as the Dotcom Bubble expanded and eventually popped. Your bonds would have offered annual returns of 18.46%, 3.64%, 9.64%, 8.70%, -0.82%, 11.63%, 8.43%, and 10.26%. Your stocks would have offered annual returns of 37.58%, 22.96%, 33.36%, 28.58%, 21.04%, -9.11%, -11.89%, and -22.10%. Declining interest rates and the mania surrounding Internet-based companies fueled some really good returns during that period. In fact, if you didn’t touch your $100,000 portfolio at all during that period, I’d estimate you would have had around $206,000 by the end of 2002.

Do you notice how the last three years of S&P 500 returns from 2000 – 2002 were negative as the bubble popped and a recession began? Wouldn’t it have been nice to have liquidated your portfolio on December 31, 1999 and missed the stock market pullback? If you had, your portfolio would have been around $248,000 on December 31, 1999; $42,000 better than it would have been worth three years later!

By now I hope you know me well enough to know I’m not the type to ever advise you going all in or all out of the market. When it comes to market timing like that, I’m just not that smart, and I don’t think anyone else is, either. I believe in calculated tactical adjustments to a portfolio if you see a medium to long-term trend, but I do not believe in ultra-short-term trading and all-in / all-out investing. There's just too much uncertainty!

Some of you that were investing back in the late 1990s and early 2000s may be able to remember how hard it would have been to sell out of your high-flying stock portfolio on December 31, 1999. That was a time (like many times before) where the sky felt like the limit.

Great, Tom. You’ve told me this story about how I would have been better off selling my January 1st, 1995 portfolio on December 31st, 1999 versus holding it until December 31st, 2002, but then you told me no one can know exactly what the future holds and not to invest all-in or all-out. What can I do? You can rebalance.

Rebalancing your portfolio is something you should periodically do to bring your portfolio strategy back in line with your initial investment strategy. Sure, it can be a hassle, it can generate some capital gains taxes, and it can generate some trading fees, but oftentimes, it’s worth it. Hopping back to our 50% bonds and 50% stocks January 1st, 1995 portfolio example, did you know that by December 31st, 1999 your portfolio would have only had 29% bonds and would have swelled to 71% stocks? Would you be happy if the portfolio strategy you agreed to in 1995 drifted that much? I don’t know many investors who would be pleased with a divergence from their investment strategy of that magnitude. That’s why in the spirit of trying to more closely maintain your investment strategy and hedge your bets on the markets continuing to roar upward vs. correct downward, periodically rebalancing your portfolio is the way to go. Excluding taxes and fees, if you would have rebalanced your January 1st, 1995 portfolio at the end of every year back to a 50% bonds and 50% stocks portfolio, your portfolio would have had around $216,000 by then end of 2002; $10,000 better than if you had done nothing at all. Rebalancing your portfolio can generate taxes and transaction costs, but it also, and more importantly, allows you to not drift too far from your investment strategy. Rebalancing is a prudent way to hedge your bets on the market going up or down in the future.

I don’t often trade a portfolio, but when I do, I prefer to rebalance. Does that make me the most interesting wealth advisor in the world?

-Tom

The Right Answer

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With all of the great college football bowl games that have been on television recently, I have seen a lot of fans doing some pretty strange things. Some fans are flat out in costume. Some are chanting the same words over and over, while some are constantly jumping in place, and some even make animal sounds during kickoffs! I can’t help but think of that old Bud Light commercial showing fans doing similarly strange things in an effort to somehow help their teams win the game. The slogan reads, “It’s only weird if it doesn’t work.”

In my world of financial advice, people ask me questions all the time. Sometimes I know or can find the “correct” financial answer pretty quickly, but most of the time I need to develop some sort of probability analysis or perform a calculation or projection before I can offer the “correct” numerical solution. The thing is, my initial “correct” financial answer or “correct” numerical solution isn’t always right for the client who asked the question, and it’s not because of faulty research or incorrect math; it’s because it doesn’t yet factor in my client’s feelings or emotions. The slogan for the financial advice I try to give to people would read, “It’s only correct if it works for you.”

Let’s say someone has $10,000 to invest and asks me if they should invest it all in gold. Let’s say a retired person who has more assets than they likely need to continue to live comfortably is really concerned about the world situation and asks me if they should invest $10,000 of their assets in gold coins to put in their safe deposit box. My long-term investment advice would probably be the same to both parties, but it might not be the right answer for both parties.

One of the questions I’m asked most frequently is when someone should begin drawing their Social Security. Someone can choose to start at age 62 or wait until age 70 and likely receive a higher benefit for each year they waited, but it is not always an easy question to answer. If two 62-year-old clients with the exact same assets and retirement incomes asked me if they should start Social Security, but one of them is losing sleep because they are concerned that the government might change their benefits if they wait to start drawing Social Security, my Social Security advice would probably be the same to both clients, but it might not be the right answer for both clients.

If two people can finally pay off their low-interest student loans or make their annual IRA contributions, but one of them has really been struggling with the fact that they still have student debt, my cash utilization advice would probably be the same to both people, but it might not be the right answer for both people.

My point is that almost all financial decisions are double-edged. There is often an analytical or numerical “correct” answer and an emotional “correct” answer. When those are the same, it’s easy to decide what to do, but when they are different, it can be quite the conundrum. Some of the deepest and most meaningful conversations I’ve ever had with clients have come from discussions where financial expertise seemed to suggest one thing and emotional credence seemed to suggest another. I take the privilege of being a part of such conversations very seriously, and it is because of conversations like these that I know no software, no app, no robo-advisor, and no strictly commission-based broker can completely replace my role in helping people think through the tough financial decisions to find their right answer.

When you find yourself facing a tough decision where your emotions and finances seem to be pushing you in two different directions, proceed with caution! Be careful relying on what you’ve read, what you’ve heard, what your computer says, and what Bob told you he did that time in the break room. Remember, it’s only correct if it works for you, and I’m happy to try to help you find your right answer.

-Tom