In Soccer and In life
Goals are a big deal.

Financial planning

If anyone can prosper, then you’ve got to be ready to let that same “anyone” define what prosperity looks like for them. It’s unique to all of us, and while some plans are similar, no two are the same.

Here’s what’s on the menu:

  • Defining Life Goals (not just financial)
  • Compiling Personal
  • Financial Statements
  • Insurance Planning
  • Tax Planning
  • Retirement Planning
  • Estate Planning
  • Intergenerational
  • Wealth Transfer
  • Education Planning
  • Charitable Foundation
  • Management
  • Philanthropic Counsel
  • Business Planning

Ideas to keep in your Curious mind

These are some of the basic concepts that will help “flavor” how we integrate finances into your life goals. Teaching is a big part of the role of an advisory, and so there’s no better time to start defining the landscape than right now!

The Ragan Young Financial Crash Course.

Average Return Vs. Real Return

Do you ever look at a mutual fund performance to determine how well they have done over a 3yr, 5yr, or 10yr time period? Of course, we all do. However, do you ever look at the volatility or the Beta of the mutual fund? I would venture to guess that the answer is no.

Let’s say you invest $10,000 into a mutual fund and it grows 100%. Your new balance is $20,000. The next year, you lose 50%. Your new value is now $10,000, which is your initial contribution. Quick, what is your real return? What is your average return?

Your average return over the 2-year period is 25%. However, your real return is 0%.

Click here to compare real returns vs. avg. returns over a given period of time.


How Diversified are you? Diversification, in my opinion, is sometimes an overused word. Most people have heard of it, but do most people really understand it? A better word I like to use is correlation. Correlation is a statistical measure which indicates the degree to which the prices of two assets move together. Correlation between two stocks is 1.0 when the prices of the two stocks move completely in tandem. Stocks with a -1.0 correlation indicates they move in completely opposite directions. If the price of stock A goes up, the price of stock B goes down. Correlation is 0 if the two stocks move completely independently of one another.

Here is a link that provides some correlation of some asset classes:

Eroding Factors of Money

When making investment decisions, one needs to consider some of the following before making investment decisions as it can affect your overall returns.

Inflation: Inflation is caused by the high rates of growth in the economy’s money supply. So, when the government pumps more money into the economy, it weakens the dollar. This means that your money’s rate of return has to keep up with the rate of inflation in order to maintain its buying power. One other thing is that Inflation is not tax deductible.

Taxes: Imagine this; most families work from January to mid-May for the government. This is just to cover their taxes. The more you earn, the more you pay in taxes. Taxes are a part of life. They help pay for things like our roads and public safety. Tax deferral is not a good strategy to lessen the tax impact. It just delays them.

Technology Change: If you remember the VHS, it became the standard format for consumer viewing and recording in the 1980s. By 2006, most major film studios stopped releasing new productions in this format. The DVD format took over. So what does this mean to the consumer? Changes in technology erodes your money because you have to either pay to keep up or be left behind.

Planned Obsolescence: How many times do you have to replace your cell phone? It’s not that they break down, but companies improve their products over time. Products are not designed to last long. Companies know and plan on this for consumers to purchase their new products as the previous ones become obsolete.

Financial Expenses: Fees, commissions, premiums, and charges can cut into your returns.

Lost-Opportunity Costs: If you pay $100 towards tax, you not only lose that $100, but you also lose the interest that you would have received if you had invested that money. Have you ever considered the lost opportunity costs on auto, home, health, disability, and other insurance policies? If they never pay a claim, then those dollars (and the interest i could have earned) are lost forever. But, if you don’t get in a wreck, if your home doesn’t burn down, and you don’t get disabled, that’s a good thing right?

Interest-Rate Declines: If you depend on a certain interest rate in order to meet your financial goals and the interest rate declines, then it may be harder for you to make ends meet. One of the things that retirees fear is investing in the market when they need this money to live on. They are afraid that they will lose their money. So they put their money in a savings account. But this strategy can still erode their money because if the interest rates decline, then that’s less money it can earn.

Loans and Interest Charges: Let’s say that it’s time for a new car. You find one for $15,000. You go to the dealership and finance the vehicle with the auto company at 6% APR. But you also have $15,000 in your savings account. You are getting 3% return. So what you have just done, regardless of financial institution, is borrow your own money for a negative -3% return.

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