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.
Investment Strategies and Sudden Gains (Such as Tax Returns)
If you find yourself with unexpected money, you may also find yourself with questions. For many, receiving an unexpected sum of money is exciting – but it also requires a strategy. Investment strategies for these life experiences don’t have to be complicated; it can be helpful to review the concepts below.
Here’s more to ponder: thinking beyond tax season, the National Endowment for Financial Education found that almost 70 percent of people who hit it big will find themselves in the same situation they were in before obtaining that money.
Recently Forbes asked a dozen investment advisors about investment strategies for windfalls. Here are their top tips to keep in mind:
1. Pay Down Your Debts
While it isn’t as fun as going on a shopping spree, paying down certain types of debt is vital for a brighter financial future. (Note: some debt is good debt. Credit card debt is never good debt. Talk to an advisor about which debt is good and which is bad.)
2. Make Fact-Based Decisions
The first reaction after receiving a windfall might be to spend, spend, spend. However, to sit and do nothing aside from developing an investment strategy is probably your smartest option. Rather than focus on short-term expenditures that satiate your shopping itch, think long-term.
3. Hold on to It
If you have no real debt to speak of, put some of the money into the bank. We never really know what life will give us, which is why setting aside enough to cover three to six months of expenses (“emergency fund”) is wise.
4. Invest It
Before you invest your windfall, you need to ask yourself a couple of questions: is my emergency fund in good shape and are my debts paid down? If you can answer yes to both, consider investing in accounts like an IRA or brokerage account. There are many different options, so talk to an investment advisor about what’s best for you.
5. Addressing Risk
For those who are immediately thinking long-term with this windfall, it’s reasonable to look down the line and assess when you think you might actually start spending this money. You need to assess the risk associated with various investments so that you have a chance at compound returns, yet the risk is low enough so that it will be there for you when you need it. There are also taxes to consider, so talk to your investment advisor about which options fit your goals.
Windfalls can cause a flood of emotions, which we all know is not the best state to be in while considering financial decisions. Do yourself a favor and hold off on making decisions and contact your investment advisor about steps you should consider.
At Family Investment Center, we’ll talk to you about your goals and how this windfall can work toward those goals. Contact us today and let’s build a solid investment strategy together.
Why an Advisor Should be More Than Just “Experienced”
Most investment advisors have gone through a number of exams and licensing steps to earn their position. But is that enough? You want an investment advisor who is up-to-date in their industry so they can help you develop an investment strategy that is the best fit for your life.
Licensing exams will test the applicant’s knowledge of basic products and state and federal laws regarding investing. While one would hope a firm would only hire people with appropriate education, not all exams hold them to the same rigor. Regardless of how extensive an advisor’s education has been, it’s important for them to continue on a path toward furthering their education.
One credential you have likely heard about is CERTIFIED FINANCIAL PLANNER™ , or CFP®. These professionals complete education and testing in areas including budgeting, planning for retirement, saving for education, tax planning, estate planning, insurance, and other areas. They are also held to rigorous experience and continuing education standards and are required to act in clients’ best interests in a constantly changing environment.
While credentials are helpful, are they enough to ensure that you’re getting the advice that will help you reach your investment goals? Advisors can also attend national conferences to boost their education and gain new ideas.
One example is Charles Schwab’s annual IMPACT conference, which provides an excellent opportunity for investment advisors to hear from others in their industry and to soak up new insights. The cornerstone of IMPACT is education, and the conference is designed to cover vital topics in an industry that continues to evolve.
Dan Danford, CEO of Family Investment Center, says taking his professionals to IMPACT is an investment in and of itself. “It’s not cheap to take all our advisors to the IMPACT conference,” Danford said. “This year it was in Chicago, but we’ve gone to Denver, San Diego, Boston, and Washington DC before.”
Despite the travel expenses, Danford said it’s totally worth the investment because the value is in what they learn.
“There are thousands of advisors there,” Danford began, “dozens of educational sessions and top-rated keynote speakers. Most of all, we learn how others are doing what we do for clients. We see new products, new software, new service models, even new competitors. Most of all, we hone our craft. Because being better each day is one powerful key to helping others.”
At Family Investment Center, we’re constantly expanding our knowledge of the investment industry so we can better serve our clients. Regardless of your level of expertise in investments, we can help you meet your goals. Contact us today and let’s talk about what your money can do for you.
Three Quick Reminders for 401(k) Investing
A 401(k) is an excellent investment tool that many workers utilize today for their retirement. Most pension plans have been replaced, in many cases, with a 401(k). Some companies offer an employer match, which is free money to you (or a company benefit, if you prefer to look at it that way). That is why 401(k) investing can be a key part of your portfolio.
First and foremost – if your company does offer a match, it may only be a single-digit percentage. Consider taking full advantage of this, because if you’re not contributing the maximum amount, you’re leaving money on the table that could be increasing the amount you have in your account when you retire. This means that if your company matches up to five percent, you should attempt to contribute five percent of each paycheck in the company 401(k) to get the full company match.
Many people will contribute more than what the employer will match because not only will they benefit from the compound interest of the matching amount from the company, but they’ll also have extra going into it that will give them more options in what they can do in retirement.
Most employees who contribute to their 401(k) accounts don’t miss it because it’s automatically withdrawn from their paycheck and placed directly into the account. There are no checks to sign or money to withdraw; you just get your regular paycheck, and you can see your contribution in the itemized list of deductions.
Enrollment is automatic, as well, for many companies, which means there is no decision to make on your part. All you have to do is adjust how much you’ll be putting in per pay period.
Take it to the Max
A goal for your investment is to try and reach the maximum amount the IRS allows you to put in every year. (There are some circumstances where this may not be in your best interest, though, so be sure to consult an advisor.) This number can change, but currently, you can contribute up to $18,000 of earned income per year.
If you’re 55 or older, you can contribute more – it’s called a “catch-up contribution” that allows you to contribute an extra $6,000 a year. This is an excellent option for people who’ve gotten a late start on retirement.
Don’t Abuse the Bonus
What do you do with your tax refunds, bonuses and raises? Do you plan big nights out, trips and large purchases? If you just spent a small percentage of that money on those things and then took the rest of that extra money and put it into your 401(k), you will grow your retirement savings at a faster rate. Let’s say you just got a five percent raise. Consider bumping up your contribution by four percent; then you may have that much extra to use in retirement.
At Family Investment Center, we’ve got many ideas to help you plan for retirement. Contact us today and schedule a visit to talk about a strategy for your investments.
Family Investment Center Now Offering Expanded Financial Planning Services
Family Investment Center is expanding its financial planning offerings, and a nationally-known professional in the investment industry has joined the team to carry this work forward. Richard C. Salmen, CFP(R), CFA, EA is leading a new team of investment professionals from a Family Investment Center office in Lenexa, Kansas.
Salmen brings a high-impact resume and national recognition to the Kansas City region. As of January 1, 2018, Richard C. Salmen serves as president of Family Investment Center and will lead the financial planning services. Salmen’s credentials include CERTIFIED FINANCIAL PLANNER® Professional and a Certified Trust & Financial Advisor (CTFA). He received the CFA Institute Board of Governors Chartered Financial Analyst (CFA®) charter. As an Enrolled Agent (EA), he is authorized to represent taxpayers before the Internal Revenue Service at all levels.
Salmen’s previous experience includes serving as the Chief Executive Officer of Northern Financial Advisors, a Detroit, MI, fee-only financial planning and investment management firm. He graduated summa cum laude with a Bachelor of Science in Business Management from the University of Nebraska at Kearney and was a graduate business scholar while receiving his Master of Business Administration (MBA) degree from the University of Kansas.
In 2006, Salmen began a three-year term as a member of the national board of directors for the Financial Planning Association (FPA) based in Denver, Colorado, ultimately serving as national President in 2009. In 2010, he served as FPA national Chairman. In November 2014 he was elected to serve a four-year term on the Board of Directors for the Certified Financial Planner Board of Standards, Inc., beginning January 1, 2015. He is the 2018 Chair of CFP® Board’s Board of Directors.
As a true multi-tasker, Salmen is a retired air traffic controller for the Federal Aviation Administration and also spent 14 years as a member of the Army Reserves, finishing his career at the rank of Captain. Read more here in this Kansas City Business Journal article.
Salmen’s accolades are commendable, but it’s his experience in financial planning that caught the eye of Dan Danford, CEO of Family Investment Center. Danford said in a recent news release that Salmen will expand on existing financial planning services. “This broadens the scope of Family Investment Center to solve client challenges at different levels of goals,” Danford said.
Furthermore, Salmen, like everyone at Family Investment Center, has operated as a fee-only, or commission-free, advisor. He will maintain that model as he works with Family Investment Center out of Lenexa. Areas of financial planning offered by Salmen and his team include tax preparation; estate planning; business planning; insurance planning and risk management; cash flow management; and goal setting.
If you’re interested in 2018 being the year that money makes sense, contact our team at Family Investment Centertoday. It’s time to start doing more of what you love.
How Your Goals Can Get a Boost With an Investment Advisor in Your Corner
Who do you trust with your money? Or, who do you trust to advise you about what you should do with your money? Too many people might offer up the following: “Friends, family and co-workers.” Unfortunately, these people, while highly trusted for a number of reasons, shouldn’t be a source of expertise when it comes to your investments. That is best left to an investment advisor.
Why not friends, family and co-workers? The reason is simply because they’re telling you what worked for them, and their situation is likely much different from yours. What worked for them might be a choice that isn’t right for you. Getting objective advice from a professional can give you a personalized plan for your unique situation.
Ask Yourself Questions About Your Investments
Have you been asking yourself if your money is in the right place or earning what it needs to earn in order for you to meet your goals? If you already have an advisor, have you wondered if they are offering objective advice? And what are they charging? When you have a fiduciary in your corner, you don’t have to worry about getting conflicting advice, and as a fiduciary, they are required to be transparent about their fee structure.
Why a fiduciary, you ask? A fiduciary is required to put your best interests first - not their own profits. A fiduciary won’t take a commission on products they sell to you, which means any advice they offer will not be motivated by lining their pockets with money.
What’s an Independent Financial Advisor?
Independent Registered Investment Advisors, or RIAs, work in independent advisory firms that offer personalized advice, which is especially beneficial if you have complex needs regarding your finances.
Many RIAs are also fiduciaries, which means they’re held to high standards of care. Furthermore, they’re registered with the Securities and Exchange Commission or their state securities regulators.
What’s the Benefit of Working With an RIA?
One of the most common reasons people say they like working with an RIA is that they develop a personal, attentive and responsive relationship with them. Furthermore, the guidance they offer is customized because no two people are alike, nor do they have the same goals. Their fee structure should be simple and transparent, meaning you never have to wonder if you’re getting charged hidden fees that you will find out about later.
At Family Investment Center, we’ve established ourselves as a fiduciary since day one. Our investment professionals have years of experience and work as a team to serve clients well. Talk to us today and let’s talk about you – your life, your goals and your future. Let us develop strategies to fit your unique situation.