What Ever Happened to the Good Old Universal Value?

What Ever Happened to the Good Old Universal Value?

HONESTY is undoubtedly one of the very few undisputed universal virtues. Every sane adult raises their children to honor, respect, and appreciate this vitally important virtue. I have yet to meet anyone who wasn’t strongly admonished as a child, by the adults who influenced them, to be honest, no matter what. Who didn’t occasionally get in trouble for being dishonest as part of their growing up process?

Then we grow up to become adults in our own rights and assume positions of power and influence. Regardless of what you do, you must realize that you are in a position of influence because your actions and interactions affect others around you. Our various positions require and assume that we haven’t abandoned our call to be honest. In fact, I would argue that even if we didn’t sign a contract specifying it, it is assumed, required, and demanded that we will be honest.

Think about it. How often do you rush to do business with someone you believe to be dishonest? You simply don’t. People just wouldn’t patronize a lawyer, doctor, financial planner, teacher, plumber, mechanic, politician, pastor, or you name it that they believe to be dishonest. Likewise, professionals in these areas promote themselves by telling consumers they are better than their competitors because these professionals have the consumer’s best interest at heart. And isn’t that just a code phrase for honesty?

Okay, I did not just fall to Earth from the skies above. I am aware and agree that it would be naïve to believe that 100 percent of folks are honest 100 percent of the time. But lately, the repeated incidences of what I’ll term gross systemic dishonesty from certain quarters has caused me to wonder what happened to that virtue we were all raised to cherish – HONESTY!

According to a recent report, federal investigators went undercover and collected audio and video evidence that some school counselors have been blatantly lying to would-be students about things like how long it should take them to complete a program and potential starting salaries after graduation. They’ve also been teaching the prospective students how to literally lie on their federal student financial aid forms. And these are school counselors, the supposed good guys!

And what about Bernie Madoff, who lied with a straight face for years, while ripping off people’s life’s savings? Or the campaigning politicians who tell lies left and right with absolute impunity, and then claim they simply “misspoke” (whatever that means) only after being caught?

You may have heard about the bizarre cases of some city officials in the California towns of Bell and Vernon. How can someone running a small town, where the average resident earns only $25,000 per year, pay themselves a yearly salary that is more than double that of President Obama’s?

So Now What?

It is my humble opinion that there will always be a few immoral jerks who believe it is much easier and somehow “smarter” to be dishonest, push the envelope, and get away with as much as they can. No question about that. I also happen to believe that no amount of monitoring, coaching, legislation, or rules can ever dissuade those who want to be dishonest. For goodness’ sake, Bernie Madoff was the Chairman of the Board of the very organization that regulates financial professionals to ensure they are clean – the National Association of Securities Dealers, now called the Financial Industry Regulatory Authority – while running one of the biggest ponzi schemes of our times. How do you make sense or explain that, except to understand that there always will be dishonest people, even in positions of power?

BUT here’s the good news! There are also folks who understand that the only ones who will be left standing tall at the end of the day are those who CHOOSE to be honest every day – no matter what! I always tell people that we don’t train or encourage the staff at Laser Financial Group to be honest – we just hire and associate with honest people!

Think You Have a Legal Right to Social Security Benefits? Think Again!

Think You Have a Legal Right to Social Security Benefits? Think Again!


Whenever I meet with prospective clients regarding their retirement income planning – and our other strategists have similar experiences – one of the first steps is identifying their sources of anticipated future income. To a person, virtually everyone identifies Social Security as their first source. And usually their perception is something along the lines of: “The system OWES me that income; they MUST pay it to me. It’s my LEGAL RIGHT!”

Well, I don’t know how to break this to you, but I’ll do my best to explain it in simple terms. If you think your past payments of Social Security taxes legally entitles you to benefits, you're dead wrong! Yes, by that, I mean: the fact that this money is regularly withdrawn from your paycheck does not give you a right to retirement benefits.

“WHAT ARE YOU TALKING ABOUT???” you’re likely wondering right now. “Who says so? Of course I’m entitled to that money – it’s MY money!”

You regular readers probably know by now that I don’t just say stuff without backing it up with FACTS. So here are the facts.

The plain and simple answer is that the U.S. Supreme Court established this in a 1960 case – FLEMMING v. NESTOR, 363 U.S. 603. In that case, Mr. Nestor argued through his attorneys, among other claims, that his promised Social Security benefits were a contract, and that Congress could not legally renege on that contract. You may be thinking and feeling similarly, right? I mean, those FICA taxes fly out of your paycheck without any mercy. However, the shocking truth is that in its ruling, the U.S. Supreme Court rejected this argument and established the principle that entitlement to Social Security benefits IS NOT a contractual right.

Interestingly enough, of all the places you can go to research this subject, the Social Security Administration has perhaps the best summary and comments on this case. Read a couple key word-for-word quotes below:

“Like all federal entitlement programs, Congress can change the rules regarding eligibility – and it has done so many times over the years. The rules can be made more generous, or they can be made more restrictive. Benefits which are granted at one time can be withdrawn…”

Read the next sentence, also from the Administration very, very carefully.

“There has been a temptation throughout the program's history for some people to suppose that their FICA payroll taxes entitle them to a benefit in a legal, contractual sense.”

I did not major in English, and neither am I a lawyer, but from a layman’s perspective, that statement is pretty straightforward, isn’t it? Look, you do not have a legal right to Social Security benefits, period! ZIPO legal right.

Just for an an added layer of confirmation, here’s a Congressional Research Service report that was prepared for members of congress by Kathleen S. Swendiman and Thomas J. Nicola, both legislative attorneys. The summary of their report says that the Supreme Court has made clear in court decisions subsequent to Flemming v. Nestor that the payment of Social Security taxes conveys no contractual rights to Social Security benefits.

This is an important thing you must understand as you plan for your retirement. Strangely enough, I am not sure how many so-called financial professionals even know and understand that Social Security is not legally guaranteed, regardless of how much you’ve paid into it.
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For a no-obligation, complimentary consultation to examine your anticipated retirement income, call Laser Financial Group at 301.949.4449 or visit us on the Web.

Should We Take Out Life Insurance Policies on Our Kids?

Should We Take Out Life Insurance Policies on Our Kids?

Okay, this is going to be one of those discussions where I ask you to completely ignore your emotions for a moment, while I present the two sides to this argument. As the father of a fashion-crazed sixth-grade daughter (please wish me luck!) and one who would have an expanded family soon (your prayers, please!), you can be sure that I have my own opinions, but I am taking my own advice here and leaving my emotions OUT of this conversation.

Absolutely Not!!

This school of thought argues that to buy coverage on children amounts to parents/guardians trying to profit upon the tragic and unlikely demise of their children. And, since these children don’t provide any income toward the upkeep of their families, there is no financial loss to replace, should the unthinkable happen. Besides, even the thought that you believe your kid might die is simply preposterous. What kind of parent would you be if you let something happen to your child?!

Absolutely Yes!!

These folks, on the other hand, argue that, our kids do die. And since we don’t know “how” (not “when”) that will happen, it is prudent to insure their lives. There are numerous stories of families who have lost children to horrible illnesses, only after racking up huge financial obligations, some resulting in home foreclosures and myriad other financial troubles that could have been assuaged – at least to some extent – by a life insurance check.

I remember, years ago, being a branch manager at a top broker-dealer/insurance agency and having to write a letter confirming that a family would be receiving a death benefit check for the passing of their child in a horrible accident before the funeral home would feel comfortable “taking care” of their deceased child. I also remember another instance where the child of one of my colleagues was diagnosed with a deadly cancer and eventually passed away. The family used up all of their financial resources to care for their gravely sick child, even missing work without pay. After all was said and done, the death benefit check they received came in very handy and saved them from what could have become a spiraling financial nightmare – following the already incredibly tragic loss. Please note that I am simply sharing these real-life stories by way of information – I am NOT saying I support those who make this argument.

Some also argue that maximum-funded insurance policies are a great way to build cash values that can later be accessed to fund a child’s college education. In this case, the primary goal of max-funding is cash accumulation; the minimum death benefit is an incidental extra.

I told you earlier that this was going to be a very charged discussion. But as I always say, if you have kept the emotions at bay long enough to gather the facts, you can then make the best decisions for your family.
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Schedule your complimentary consultation with an expert at Laser Financial Group today! Call us at 301.949.4449 or visit us on the Web.

What REALLY Happens to the Dollars You Invest?

What REALLY Happens to the Dollars You Invest?

When most Americans invest money in their retirement plans, they usually go the traditional route, whereby if the stock market does well, they could make unlimited gains. On the other hand, when things go south, the losses also are unlimited. Millions are still trying to recover from this reality as you read this. The second traditional option is to purchase a product that pays a fixed amount of interest, like a CD from a bank, for instance.

Then there is a little-known approach that links investments to a stock market index and earns interest based on the market’s performance – via that index. Since the money is not actually invested in the market, however, when things go bad, investors don’t lose anything. This option has minimum and maximum cap rates, but it keeps market risk completely off the radar.

The thing most people don’t really understand – and, for the most part, haven’t even considered – is whether, when they make gains or losses as investors, the investment companies who carry their savings do the same.  Say you buy a mutual fund, a CD, or an annuity and your money goes to “this place” called the stock market or the bank’s vault, do you gain when the market does well and the investment company/bank gains, and do poorly when the investment company/bank loses?

It would make sense to believe it works this way, but that’s not exactly what happens. Will Rogers once said, “The problem in America isn’t so much what people don’t know; the problem is what people think they know that just ain’t so.”

You see, when you put your money in a bank or any other investment company, they use that money to undertake business ventures they believe will enable them to make money. And I’m talking serious cash, w-a-a-a-y more than you have probably ever imagined.  Now, since they have your money, there has to be a mechanism that gauges how much they have to return to you at any point in time, right? This is precisely where direct stock market investments, linking strategies, fixed interest, and a multitude of other strategies come in to play. Think of them as contracts (the key word being contracts), because in a very real sense, that’s EXACTLY what they are.

Again, these contracts are used to determine how much you have a right to claim of the investment you made. I know you are smart and starting to see the big picture, but please think about this for a moment. Do any of these companies or banks exist to lose money in an unpredictable stock market? Have you noticed that, for the most part, the SAME investment companies offer various types of investments – again, I call them contracts? 

None of our clients lost any money during the recent economic tsunami. What’s most interesting, though, is that the EXACT SAME companies (and I mean the same everything) in which our clients invested their money have many other customers whose contracts lost the better part of their life savings. Interesting, isn’t it?  The reason being is that these companies offer options, just like you’d find at a clothing store or a car dealership. So some of their investors’ money is more protected, while others have a much greater risk.

So How Come Everyone Isn’t Aware of These Choices?

I wish I had the crystal ball on this one, but I don’t. All I know for sure is that these options exist. The caveat is that not all companies carry every contract/option – just as in almost every field. May I therefore humbly suggest that you consult with a qualified, independent financial professional who knows what he/she is doing and, more importantly, is also honest to the core? Because from what I’ve seen, that’s the only way you can be sure you’ll be presented with all the choices available so that YOU can determine what will work best in YOUR circumstance.

Rather than worrying about how your investment company could be protecting your money while the majority seems to be hemorrhaging cash by the second, focus instead on making sure you are dealing with a LEGITIMATE business and that you have an ENFORCEABLE contract (notice the word contract again here). A truly independent and honest financial professional is indispensible when it comes to making sound decisions for your future.

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Call Laser Financial Group today at 301.949.4449 (or visit our Web site) to set up your confidential, complimentary appointment with an honest, independent advisor who can give you a new perspective about your investment options.