Is Your Financial Advisor Watching You Break the Rules of Prudent Investing for Fear of Losing Paychecks?

Is your financial advisor watching you break the rules of prudent investing for fear of losing paychecks?

Do you have the kind of financial advisor who’ll always tell you what’s right and refuse to see you make moves with your portfolio that are imprudent, based on your circumstances? Or is your advisor of the breed – I’d even dare to say it’s where most advisors fall these days – who lets his/her clients make all the decisions regarding their portfolios, even down to specific asset class combinations, when it’s appropriate to rebalance, and everything in between? Personally I think that’s a terrible – and incredibly unfortunate – mistake.

Now, don’t get me wrong. I’m by no means suggesting that you simply go hand over your hard-earned money to some guy or gal in a suit, sitting in an air conditioned office, and completely back off without any input whatsoever. Truth is, I wouldn’t do that with my own money, so why would I expect you to invest that way?

But here’s my point. As an investor, you must have clear and specific input and expectations regarding what you want and do not want, for that matter, when it comes to your portfolio – things like how much volatility you can live with, etc. Even if you’re not that specific, a good financial advisor must and will have a thorough discussion with you in order to understand at the deepest possible level your core vision, desires, concerns, and expectations so that he or she can help you put together the best possible portfolio to get the job done. In the end, you should know exactly why your money is invested in a certain way, what you can expect – both good and bad – and when and how changes are to be made. As a matter of fact, isn't this the exact reason financial advisers are paid in the first place?

Now contrast that with what seems to be the norm today, where the investor tells the advisor specifically what to buy or when they believe they should get in or out of specific investments. Let’s face it, most of this is based purely on emotions whipped up by what’s going on in the media.

Of course, I get it. The money belongs to the investor and he or she may decide to invest it as he or she pleases. But think about it. Would you prefer a doctor who lets you, as the patient, decide the exact prescription and dosage you should be taking?

Could it be that these so-called financial advisors who are leaving every decision completely up to the client are so concerned about maintaining their paychecks that they will do whatever makes the client feels good and happy? Are they so worried that the client might go somewhere else that they’d let them do whatever makes them happy in the moment, even if it could end up destroying the very wealth they’re trying to grow in the long run? Or it is that these advisors do not want to be held accountable for the very thing they’re paid to do, guiding clients to invest prudently, according to their specific circumstances?

Then again, if you skip the initial step I mentioned earlier and invest without having a clear-cut understanding of where you are headed and what you can expect, isn’t this the natural progression?

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Visit LaserFG.com or call 877.656.9111 right now to book your complimentary, confidential consultation with a financial professional who has your best interest at heart and who is willing to ask the tough questions to help you get where you want to go. You’ll be paired with an experienced financial professional who can help you plan for a secure future, regardless of your current financial situation. Retirement planning means planning for ALL aspects of your life after retirement. If you're ready, we’re here to help. 

The Life Insurance Debate: Forget Everyone Else and Go with Your Guts

The Life Insurance Debate: Forget Everyone Else and Go with Your Guts

It’s my tradition during September, Life Insurance Awareness Month, to dedicate one of my columns to that subject. So let's talk about it from the standpoint of asking, “Is it really necessary for you to purchase life insurance?” and also address some of the reasons that folks who should purchase life insurance give for not doing so.

First, do you even need it? I know that there are several consumer schools of thought out there on this very issue, but throughout my years as an advisor in professional practice, I have arrived at what I like to refer to as the common-sense approach to money management.

In this particular instance, here’s how I’d put it: Life insurance simply pays money, upon your death, to someone you designate. Period. So, do you have someone or several folks who will still need the financial support you are presently providing, in case the unthinkable were to happen to you?

Yeah, yeah, yeah. Am I telling you to go spend money on some life insurance which, in all likelihood, you might never end up using? Of course, you're probably going to live a good long life, but it's not as simple as that, is it? Personally, I think we should see life insurance premiums as not being about us, but as a representation of our commitment and responsibility to take care of our dependents financially. Just so we are crystal clear, I am not advocating running out to buy life insurance. Not at all. Instead, I want you to do what you feel in your gut is right for your family.

Now here's the thing I like to point out. Unfortunately, just as with many other things in life, there are some unscrupulous life insurance agents who are more focused on selling only whatever they have to offer so they can get paid, without regard for whether it's really appropriate to your specific need. However, the good news is there are also some decent, honest agents out there who can help you get exactly what you need to take care of your responsibility to your loved ones, so don't let the unscrupulous ones hold you back.

I wish you the very best of luck and a healthy long life with your family.

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If you'd like help to be sure your portfolio is properly diversified,  visit LaserFG.com or call 877.656.9111 right now to book your complimentary, confidential consultation. You'll be paired with an experienced financial professional who can help you plan for a secure future, regardless of your current financial situation. Retirement planning means planning for ALL aspects of your life after retirement. If you're ready, we're here to help. 

The Stock Market Probably Isn’t Going to Destroy Your Wealth – But This Certainly Will

The Stock Market Probably Isn’t Going to Destroy Your Wealth – But This Certainly Will

Let me admit right off the bat, the headline may sound a little out of the norm from what you may have heard, read about, and probably even come to accept about the stock market, especially in recent days. But take a deep breath and consider these fundamental truths.

First of all, it’s important for those of us who choose to invest in the stock market to remind ourselves of the reason that we made that decision, instead of investing in, say, a CD at our local bank or some sort of fixed annuity or any other alternative investment. At the very core of that decision must be the fact that the stock market is, by far, the greatest known wealth creation tool in the history of mankind, bar none. Nothing else legitimate even comes close.

But that is not all. We also know, without any shadow of a doubt, that the stock market – since its inception – has never moved in a vertical straight line. Things would be pretty nice and much, much easier if that were how it worked, wouldn’t you say? However, that’s not how it works. In fact, did you know that your financial advisor would face regulatory penalties if he/she were to give you the impression that your stock market portfolio could only go up? The simple reason for that being that such a suggestion would be misleading and set unrealistic expectations.

Here’s the normal thing about the stock market: sometimes it goes up and sometimes it dips. The other crucial thing to understand is that no financial advisor – or anyone you’ll see in the media, or anywhere on this planet, for that matter – can tell you exactly what the market is going to do next. Yes, no one knows!

The problem, in my humble opinion, is that most investors do not have prudent stock portfolios. They just buy something that sounds, looks, or feels good, without really making sure that it’s properly diversified to help them weather the storms that may come along. Although no one on the face of this planet can predict the future movements of the stock market, there is such a thing as an efficiently diversified portfolio that is custom-built to your investment temperament so to speak.

Here’re some recommendations to think about. If you don’t think you’re up to all these ups and downs, you should probably not be investing in the stock market at all. And I’m not trying to be sarcastic or anything here. If, on the other hand, you believe that over the long haul you’d be better off investing some of your money in the market, please make sure you talk with a financial professional who can help you to build an efficiently diversified portfolio with a standard deviation (amount of volatility) you can live with, and don't be surprised when the down moments come, because more likely than not they will.

And the most crucial thing of all is to make sure your advisor is someone who’ll keep you on your toes to stay the course with discipline. What does that mean? When the market tumbles, as it did in recent days, and panic sets in, does your advisor cave and do whatever you want done? Or does he/she remind you about the basics and see it as an opportunity to re-balance your portfolio?

Finally, whatever you decide to do, I hope you don't take your investing advice from Jim Cramer.

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If you'd like help to be sure your portfolio is properly diversified,  visit LaserFG.com or call 877.656.9111 right now to book your complimentary, confidential consultation. You'll be paired with an experienced financial professional who can help you plan for a secure future, regardless of your current financial situation. Retirement planning means planning for ALL aspects of your life after retirement. If you're ready, we're here to help. 

The ONE Inherited 401(k)/IRA Mistake that Could Be Your Worst IRS Nightmare

The One Inherited 401(k)/IRA Mistake that Could Be Your Worst IRS Nightmare

As the proverbial saying goes, “life happens.” And as part of the natural progression of life, sooner or later, we are all bound to lose someone near and dear  – and that person may have listed us as a non-spouse beneficiary of his/her 401(k), traditional IRA, or another kind of qualified plan.

 No, I’m not trying to suggest what you should do with your inheritance. That will be totally up to you. However, if you intend to roll over money left to you in a qualified plan by someone other than your spouse, you must tread cautiously. And that’s because the manner in which you go about it could land you in some very hot waters with the IRS.

Let me use this recent case involving one of our clients to illustrate my point. She recently lost her mom, of whose IRA she was the beneficiary. The custodian of the IRA sent her a check made out in her (the client’s) name and explained to her that insofar as she deposited it in an IRA within 60 days, she would avoid having to pay taxes on the entire check, come tax time.

While that may sound like a pretty standard thing, it’s completely wrong, untrue, and inapplicable in this situation. The so-called “60-day-indirect-rollover” rule does not apply if you are a non-spouse beneficiary. What’s more, there’s no exception under the Tax Code – Section 408(d)(3)(c) – for non-spousal beneficiaries who accept checks made out in their names, even if you turn around and deposited it into an inherited IRA the very next moment.

So, but for the fact that my client has a pretty sharp advisor who knows what he’s talking about – hey, its OK for yours truly to take some credit every now and then – she would have been set up for a very nasty surprise come next April 15th when the IRS came knocking: that she would have to pay tax on her entire inheritance check. 

It was pretty obvious to me that whoever gave her the erroneous information was unfamiliar with the IRS rules, so I got on the phone with the custodian to get the situation sorted out and have a new check issued directly to the new custodian.

In a nutshell, here’s what you should keep in mind. If someone other than your spouse leaves you money in a qualified plan and you intend to spread the tax burden over the longest possible time allowed by the IRS, your ONLY option is a direct-custodian-to-custodian rollover. And by the way, you should probably get yourself a pretty darn knowledgeable financial advisor, too!

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If you are ready to have a real conversation about how to start planning for your future – even if you haven't saved a penny yet – visit LaserFG.com or call 877.656.9111 right now to book your complimentary, confidential consultation. You'll be paired with an experienced financial professional who can help you plan for a secure future, regardless of your current financial situation. Retirement planning means planning for ALL aspects of your life after retirement. If you're ready, we're here to help. 

Are You in Denial About Your Retirement?

Are You in Denial About Your Retirement?

According to the 51-page Retirement Security Report released by the Government Accountability Office (GAO), as recently as June 2015, among households headed by someone age 55 or older, about 29 percent don't have a retirement savings of their own or any form of employer pension. Just to reiterate, these forks have absolutely no savings whatsoever, anywhere.

And the situation is not much better among those 55+ households who do have some form of savings. On average, those between 55 and 64 have about $104,000 in savings, while those between 65 and 74 have about $148,000 saved for retirement. These balances translate into a monthly annuity payment of $310 and $649, respectively.

No matter how you look at it, these are very grim scenarios.

Of course these folks knew all along that they weren't going to keep working forever, even if that was what they were somehow hoping to do. In fact, I’d even bet that every single one of these well-meaning folks never intended to enter their retirement years in total financial disarray.

So what happened?

Obviously, there could be a million and one reasons why these folks are in the bind they find themselves at the latter end of their lives. But what you must realize is that although they intended for the best and hoped it would play out just as they wished, hoping and intending weren’t enough because they didn’t back them up with the right amount of action.

So how much importance do you attach to your retirement planning? Is retirement even that crucial to you? Do you have a specific plan in place to measure your progress in this regard? Or you are simply saving a little here and there and hoping that things will just turn out OK?

While most of us would agree that retirement planning in one of the things that should be at the top of our to-do list, unfortunately the evidence in real life, as seen by the GAO report I referenced earlier, proves otherwise. A staggering number Americans are increasingly relegating retirement planning to the bottom of their to-do lists and are not taking it seriously enough. I’m hoping you hear this message loud and clear, because the last thing you want to be is a broke retiree.

Happy retirement.

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If you are ready to have a real conversation about how to start planning for your retirement – even if you haven't saved a penny yet – visit LaserFG.com or call 877.656.9111 right now to book your complimentary, confidential consultation. You'll be paired with an experienced financial professional who can help you plan for a secure retirement, regardless of your current financial situation. Retirement planning means planning for ALL aspects of your life after retirement. If you're ready, we're here to help. 

My Feedback on Ron Paul’s America Destruction Commercial

My Feedback on Ron Paul’s America Destruction Commercial

It’s all over the place, so you’ve probably already seen it. Former congressman Ron Paul appears in a commercial warning us about the coming "inevitable" total collapse of the American dollar – and with it, civil unrest and martial law. In fact, in his own words – or more appropriately, those of Stansberry Research, the outfit for which he is the spokesperson – this coming crisis will be “infinitely worse than the crisis of 2008”… and, of course “stocks and bonds will crash.”

To sum up both the short TV commercial and the entire 54-minute supposed warning, everything is basically going to grind to a halt and it’s going to be cataclysmic. But of course there’s a solution. Your family can survive this next crash if you buy Porter Stansberry’s America 2020: The Survival Blueprint publication for $49.50 or thereabouts.

Now here are my two cents on this.

All the commercials on TV and elsewhere seem to be suggesting that this apparent warning is coming from the former Congressman. However, when you visit the site to which the ad directs you, there’s a disclaimer – a.k.a fine print – at the bottom of the page notifying you that “Ron Paul is the spokesman for Stansberry Research, LLC.” I wonder why the commercial doesn’t make this connection up front, rather than burying it in the fine print. Could it have something to do with the fact that Porter Stansberry’s firm has a notorious reputation for making, quite frankly, outlandish claims about the destruction of our economic system and way of life that turned out to be full of hot air?

If my memory serves me, which I believe it does, this was the same outfit behind the claim that

America will totally collapse back in 2011. We are now more than halfway through 2015. The last time I checked, we are still here, in the United States of America. And we still have our economic livelihoods intact, for the most part. Now Stansberry’s firm want us to buy even more of their stuff?

As for former Congressman Ron Paul lending his credibility to this kind of message, this is a free nation, so he should go ahead and knock himself out. Personally, I will not be spending my 50 bucks or so on this so-called Survival Blueprint. I think that’ll get me couple weeks’ worth of my favorite vanilla chai latte. You draw your own conclusions.

All my best.

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Want an independent assessment to confirm that you are on the right track when it comes to saving for your retirement, including the money you will leave to your heirs? Come in so we can help you to  objectively evaluate your current approach. Visit LaserFG.com or call 877.656.9111 right now to book your complimentary session. 

Should You Get Out of the Stock Market Now?

Should You Get Out of the Stock Market Now?

Are we at the beginning of a stock market Armageddon that will grind everything to a halt? In the wake of the hoopla surrounding the situations in Greece, on the one hand, and China on the other hand, many investors are wondering whether now is the time to head for the exit. If that’s you, I don’t blame you at all. Heck, I would be scared too, just listening to some of these so-called “market experts” (notice the quotation marks) tell the rest of us without crystal balls what to expect.

So should you pull out of the stock market now, as some are suggesting? Obviously that is a crucial question – the answer to which, in my opinion, lies in one basic and indisputable fact about the stock market:

No one on the face of this planet – including your favorite media money guru, financial advisor, pastor, or member of Congress – can predict exactly where the stock market is headed. I'm sorry if you thought otherwise, but the stock market isn't a predictable thing. As an investor, you must understand this fundamental fact in order to maintain your sanity as you invest your hard-earned money. The only predictable thing about the stock market is that it will fluctuate – sometimes it goes up and sometimes it dips.

While it is true that certain events do impact the market, no one can actually predict the specifics of those events, let alone the extent to which they might impact global financial markets. Keep in mind that all these “experts” offering their interpretations of what is going on in Greece and China (or any other event in the past or future, I might add) come after the fact – as in, at the end of the trading day, week, month, quarter, year, decade, etc. Who couldn't come up with the perfect analysis of what happened after-the-fact? On Main Street, we call it Monday Morning Quarterbacking for a reason.

Take the past several days, for instance. One moment Greece and China are pulling the stock market into another crash. The very next moment,  the market is back in the green because Greece and China aren't that big of a deal. Seriously?

Don't get me wrong, though. I'm not implying that you should just throw your money into some stock portfolio and hope for the best. There is such thing as an efficient stock portfolio that is built based on sound principles, including recognizing that the market will indeed move up and down due to situations and circumstances beyond your control. I believe it behooves every investor to have a carefully crafted and properly diversified global portfolio, with true negatively and/or low correlated asset classes. And then to re-balance it when necessary.

Interestingly enough, there's overwhelming agreement in the financial planning community that this is precisely what a prudent investor should be doing. But in reality, most so-called financial advisors seem more focused on selling the next hot mutual fund or stock, rather than on keeping investors focused on the fundamental principles.

I don't know what the end game will be in Greece or China. However, this much I can tell you. When investors panic, they tend to make the wrong moves with their portfolios – and some pay for those mistakes for the rest of their lives. The fact is that whether Greece, China, or any other country goes down or not, if you don't have an efficient portfolio and a disciplined advisor, any significant hit could destroy your wealth.

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Want an independent assessment to confirm that you are on the right track when it comes to saving for your retirement, including the money you will leave to your heirs? Come in so we can help you to  objectively evaluate your current approach. Visit LaserFG.com or call 877.656.9111 right now to book your complimentary session.