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Improving The Traditionally Allocated Portfolio

Published by Tyler Schlumpf

We’re going to introduce a few mathematical concepts in this article that are crucial to building a portfolio. For those that are already moving their cursor up to the X in the right hand corner, just stick with it! These concepts, whether we choose to learn them or not, have a significant impact on the way we combine investments and are important to understand as we discuss portfolio construction. Read more

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Good Reasons to be a Control Freak

“To try may be to die, but not to care is never to be born.” –William Redfield

In 2008, the institutions that were the foundation of the U.S. economy dissolved as if they were built on sand.  Most of us probably couldn’t describe exactly what all of these companies did, but we recognized them from their Manhattan skyscrapers, billboards, and TV ads.

In a downward spiral that seemed to have no bottom, we heard and read that companies like AIG, Merrill Lynch, Countrywide, Lehman Brothers, and Bear Stearns were on the brink of collapse.  When Lehman Brothers filed for bankruptcy, we learned that it was the largest bankruptcy filing in U.S. history.  We read that Countrywide, the company to which millions of us mailed our mortgage payments every month, was failing quickly.  (We now know that it was acquired by Bank of America).

We expressed outrage when AIG, at one point the world’s largest insurer, received federal bailout money and two weeks later rewarded a select group of employees with lavish bonuses totaling $443,344.  The corporate compensation proved to be a major public relations gaffe and fed into public perceptions of corporate excess. Read more

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4 Simple Steps to Creating an Estate Plan

Published by Beth Schanou, JD

Most of the time, it feels like life is moving at the speed of light. I often feel my entire day, both at home and at the office, is spent in fast forward mode. As if it’s a race to get done as much as possible, I’m running from one thing to the next, all day long, and making sure every household member is fed, cared for, and attends school and their activities. Of course this includes the four-legged members of the family too. Read more

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Risk & Reality

By Robert O. Graves, CFP® CERTIFIED FINANCIAL PLANNER™

 

Part of creating a Life Plan for clients requires assessing their risk tolerance.  I ask the following question:  “How would you feel if you lost 10 percent of your savings because of a market downturn?”

“I think I’d be OK with that”, a client says.

“How about this: if you had $1 million and lost $100,000, how would you feel?”

A blank stare tells me that the 10 percent loss, when put into dollars and cents, is far less palatable.  Prior to 2008, many investors didn’t understand the asset allocation risks they were taking.  As a result, their portfolios were focused on certain areas while neglecting others.  This may have prevented them from having a well-defined, diversified portfolio with alternative investments that may help protect it.

I hope that the recession will help people understand risk better than they have in the past and that they will understand the difference between long and short range planning; the more time you have, the more risk you can take.  The opposite is true as well: the less time you have, the less risk you should take.  Recognizing risk factors in a tangible way means that more of us will be conservative in our investments, which could benefit us greatly in the long term. Read more

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4 Easy Ways to Diversify Your Investments

Published By Jake Bleicher, Equity Analyst

The benefit diversified investments has for a portfolio is simple, in theory. It reduces the impact any individual investment has on the portfolio, and proper diversification can help mitigate losses during a market downturn. In practice however, portfolios can become a large hodgepodge of various assets rather than a methodical allocation. The key is to reduce the correlation between assets so that they generally perform independent of one another. Read more

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What Will You Retire To?

By Robert O. Graves, CFP® CERTIFIED FINANCIAL PLANNER™

 

The familiar image of retired men and women spending their years rocking back and forth on the front porch may be a satisfactory path and even a goal for some.  But if you’re like most of my clients, this won’t satisfy.  Why?  Because you’ve got to find purpose in your retirement.

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5 Reasons It’s Important to Set Financial Goals

Published by Rob Furlong, Portfolio Manager

The alarm sounded promptly at 1a.m. Shortly after some rustling and grumbling the tent zippers opened and we stepped out into the frigid air. After a quick breakfast, we began heading uphill into the darkness. For the next eight hours life was little more than listening to the ice crunch with each step as we ascended over 5,000 feet into the thinning air. Shortly after 9a.m. we were at 14,200 feet-on top of one of the highest peaks in the Cascade mountain range. Read more

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How Emotional Decisions Can Ruin Your Investment Strategy

More money is left behind than lost during market declines. When an investor reacts emotionally to declines, they often pull money out of the market, derailing their investment strategy and leaving them much less exposed to equity markets. Often, these moves are made very near the bottom of the market and the investor leaves behind a substantial portion of return. Read more

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What Does Retirement Mean to You

By Robert O. Graves, CFP®  CERTIFIED FINANCIAL PLANNER™

 

I’ve never agreed with popular images of retirement: People spend most of their adult lives working for a company.  They wait for that final day when they will empty their filing cabinets, clear their desks, and pack all of their belongings in a cardboard box.  They then attend an office farewell party.  Afterwards, they spend the rest of their lives unemployed.  Although this scenario works for many, unfortunately my experience helping countless clients tells me that the following this paradigm can lead to boredom, frustration, and even early death.

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When Can You Retire?

Not surprisingly, one of the most common goals financial planners help their clients with is analyzing cash flow in retirement so they can live their lives comfortably without worrying about outliving their money. Cash inflow in retirement can come from many sources (Social Security, retirement plans, savings, annuities, pensions) so it’s important to consider how much and when to expect cash inflows. Read more