Average is not good enough … Our goal at Family Investment Center is excellence. We find excellent investment products and supervise an excellent service package. We maintain a library of excellent research materials and financial planning resources. We also demand top safety and security for our clients.
We won’t settle for average. We continually seek top managers or securities and meld them into superior custom portfolios. Each palette of investments is carefully tailored to personal or family goals. We enlist excellent managers, research, resources, and effort for our clients. Don’t settle for average. You deserve excellence.
Please search our blog posts for answers to common investment questions, and we look forward to sharing our knowledge and experience with you first-hand.
You’ve worked for decades and have established a nice retirement lump of cash in your 401(k). You’re getting close to retirement and you think it might be time to make some changes – but don’t get too jumpy. There are some things to keep in mind before you risk tripping into an investment blooper.
Don’t Make Sweeping Shifts
It’s a common misconception that as you get closer to retirement you need to get out of stocks and bonds. The reality is that if you retire at 65, you’ll likely have at least another 10 years (average life expectancy for males is age 75 and age 81 for women) where you’ll be withdrawing that money for expenses, which means a portion can still be building on itself in stocks and bonds. You aren’t using up your entire retirement savings in one year, so let it keep working for you.
Be Aware of Risk and Risk Aversion
Do you know exactly what the risks are with each one of your investments? People who run into trouble are often the ones that have not clarified the risk associated with their investments. Investment advisors will tell you that while risk aversion can keep you from some significant gains, jumping into investments without proper guidance can put you in a worse situation come retirement day.
Balancing Social Security and 401(k)
Maybe you’ve considered stopping your pre-tax contribution to your 401(k) so that you’ll see higher benefits in Social Security? This is a popular one for investment “experts” to tout, but you want to think carefully about this. While the 401(k) contribution does lower your income tax, it doesn’t affect your Social Security tax and FICA payments. By this logic, you’d be smarter to put more in your 401(k) as you get closer to retirement.
Talk to Investment Managers
It’s commendable that you’re researching your options as you plan for retirement. Financial literacy is in short order today. However, there are so many loopholes, pitfalls, and complex situations involved with investments that many successful investors work with investment advisors (they work with other peoples’ money on a regular basis and have an understanding of the changing investment market). They have the knowledge required to keep your nest egg in the right place working for you, and they have more time to devote to it.
The investment advisors at Family Investment Center are ready to help you look at the changes you need to make as you near your retirement. If you’ve tried the do-it-yourself approach and/or have consulted with commission-based brokers or financial planners and didn’t come away with a winning situation, perhaps it’s time to consider our services. Whether you’re already retired or still working, we offer the solutions that can give you confidence for what tomorrow holds.
A surprising number of Americans do next to nothing to prepare for retirement. For those that do make efforts to put their money to work in investments for retirement, the process often causes confusion. According to Money Magazine, planning your retirement isn’t getting any easier – and most adults don’t have a full set of answers.
Decades ago, it was common for a worker to retire on the pension plan at their place of employment. These plans have fallen out of favor with a majority of American businesses, which means that you are having to do a lot more work on planning your retirement than the generation of workers before you.
As noted in Money Magazine, with 64 percent of households within five years of retirement, it’s more important now than ever that Americans find the answers to their questions. A financial research firm, Hearts and Wallets, did a study recently that found the percentage of households so close to retirement has jumped by 10 points in just two years. Furthermore, the research indicates that Americans believe retirement planning is the most difficult among 24 other financial tasks.
What’s the biggest obstacle to understanding retirement? For many people it’s knowing when exactly they will retire. The Hearts and Wallets study found that 61 percent of those surveyed said they didn’t know when they would retire. For nearly everybody else, planning for retirement is difficult due to not knowing how long a lifespan will be after retirement.
Another area that confuses Americans, and understandably so, is figuring out the minimum distributions from retirement accounts, deciding where to invest, and when to start investing. These are aspects of planning your retirement that could use the help of a professional investment advisor.
Hearts and Wallets didn’t touch on the mortality aspect of planning for retirement. However, due to the advancements in medical technology and ingenuity, we’re living longer. In 1950, women could expect to see age 71 whereas men were looking at 65 as their average life expectancy. Today, women can expect to live to age 81 and men to age 76. These are things to take into account for retirement that your parents or grandparents didn’t probably consider as heavily.
One of the tools you can use in your retirement planning is Social Security. While this isn’t likely going to be the bulk of your income for your retirement years, if approached correctly, you can have thousands more dollars in Social Security benefits coming to you over your lifetime.
To get the answers to your Social Security questions and to clear up confusion about your retirement planning, come to Family Investment Center where professional and experienced advisors are ready to guide you through the process. (Plus, we don’t operate on commission – instead we’re motivated by you reaching your goals!)
Americans love taking the do-it-yourself (DIY) approach. Plenty of reality television programs document the lives of people in the process of DIY projects, some meeting with success and others with failure. When it comes to managing your investments, how smart is it to go the DIY route?
Given the sheer number of investment “experts” offering advice on television, magazines and in books, you’d think there is plenty of information out there to give you a head start on the process. So, you spend a few hours a month reading up on investing, loosely following the market and think you’re ready to jump in with both feet and put all of your money to work for you. It could be a big mistake.
Financial planning is not something most successful investors want to take up as a hobby. It’s something best left to the real experts – the ones who do it for a living. Despite all of your research, you’re probably not capable of watching over your money as well as a professional investment advisor. (According to a survey by Charles Schwab, around 33 percent of people who need investment advice don’t seek it from a professional, so you’re not alone). But you do have a chance to change the situation, starting now.
Maybe you’re thinking you don’t need financial planning advice because your bank account doesn’t match that of a wealthy person. Not all rich people were born that way. Some of them worked hard for their money and consulted an advisor long before they could be considered wealthy. Financial planning assistance and investment advising services are there for anybody, and it doesn’t have to be overpriced. In fact, a fee-only advisor will work with you on a range of “nest egg” sizes without the added pressure of the advisor working on sales commission.
Maybe you’re thinking you don’t need financial planning advice because you have a very simple financial situation. Qualified, experienced financial advisors are capable of unleashing a wealth of information, even for people who think their finances are simple. Thinking this way could keep you from realizing your potential as an investor, and it could keep you stuck in some old patterns of thought that aren’t based on reality. A financial planning expert can unlock these complexities for you and they work hard to stay on top of the knowledge to do so.
Once you consult with an investment advisor your work is only just beginning when you sit down for your consultation. You might learn that you need to adjust your spending or saving habits to create a larger window of opportunity when it comes to Social Security benefits later. As you age and your life changes, you’ll need to make adjustments and financial decisions that protect and/or enhance your investments. A financial advisor will be there to provide guidance on your options.
The professionals at Family Investment Center are investment advisors specializing in large portfolios. Our team knows the process of investment advice can be intimidating, which is why we are careful to fully explain everything and to listen to your needs. We focus on wealth “wellness,” which means your investments can be one part of the total picture of confidence as you look toward your future.
What You Can Learn From the Mistakes of Those Who Accumulate Wealth Quickly
We marvel at the talents of professional athletes. We also dream of accumulating wealth in a short period of time as they have. The reality is that some of us will end up in a better position financially if we follow some fairly straightforward rules of investing.
Financial planning for athletes differs somewhat from the average salary-earning worker in that they will accumulate their wealth in a few short years before they’re forced into retirement. Those who are successful plan wisely and avoid the temptation to live large. A first-round draft pick will last around nine years on average. However, the players selected later in the draft that make the opening day roster will see a career lifespan of around six years. The point is that these players have a little time to amass the money they’ll rely on for the remainder of their lives.
ESPN highlighted the expenditures of one player selected in the 10th spot in the draft. According to ESPN, Travis Taylor made big purchases at luxury car dealerships and a Rolex watch shop, bought a new home, and spent $40,000 on furniture, even before he had signed with the Baltimore Ravens.
This would all seem perfectly logical if he could count on a career that lasts until he’s 65, but in reality, he may be lucky to be in the league on his 30 birthday. The lesson here for the rest of us is that the top earning years can be shorter than we expect. Investing with consistency and working with a professional advisor can mean maximizing these earnings over the long haul.
Athletes pulling down big salaries find themselves in a very high tax bracket. Those without accountants or financial advisors sometimes fail to take into account that nearly 40 percent of their earnings must go to Uncle Sam. Others may fall victim to scammers who offer the moon but take everything, which is what NFL player Darren Woodson found out when he lost almost $4 million in a bad deal with a financial planner. The takeaway here is that taking big risks rarely pays off. What are you doing to lessen the blow of the taxes you pay and how risky are your investments?
Professional athletes experience the same financial pitfalls and temptations we all face, but on a bigger stage and in a grander scale. Like us, they are sometimes too focused on spending rather than saving; they don’t put a consistent retirement plan together and they are not always willing to invest responsibly because it seems like there will always be plenty of time to earn more money.
If you’ve got questions about wise investing, contact the team at Family Investment Center. In fact, our founder/CEO Dan Danford is a Registered Financial Advisor for the NFL Players Association. Aside from our nationally-known credentials, it’s our focus to see you reach your goals in a commission-free setting. Reach out to us today and let’s get started.