03/19/2012
In Search of Guarantees
Guarantee...an interesting and oftentimes overused word...death and taxes, right? However, in this, the most volatile time I've seen in my entire adulthood, people are seeking things that are "guaranteed" but rarely do they find what they are looking for...at least in my opinion. For some reason beyond my application of "applied common sense", people think that investing in stocks, mutual funds, etc. have some type of guarantee associated with them because they have an average annual return of X%. There's a reason the phrase "past performance is not indicative of future results" is stamped on every brochure, prospectus, and other relevant piece of material associated with these investments.
So, is anything "guaranteed" anymore? Webster's defines the word as: a promise or assurance, especially one in writing, that something is of specified quality, content, benefit, etc. To use this definition, in my world, yes there are things that are guaranteed...because they are in writing, and they come from major financial institutions, like life insurance companies. OK, just because I mentioned the words "life insurance" doesn't mean you should stop reading. This is about the word "guarantee". There are certain aspects about some of their products where the word "guaranteed" can work against you.
Case in point: a large majority of "Financial Entertainers" tell you to purchase only level term life insurance to protect you, your family & your business...because it's inexpensive, and "anything other than term is garbage" to quote one of them. Usually they tell you to buy a "20 year guaranteed level" product. There's that word again...whatever the annual cost will be...there are two guarantees there. The first one is that your cost is guaranteed to not change for 20 years. However, the second one is that the price in the 21st year and beyond is guaranteed to increase exponentially should you have to keep it due to health reasons & the ability to buy new insurance. There's a reason that 98% of all term insurance policies issued never pay the benefits to the chosen beneficiary: people outlive the guaranteed period and can't pay the price in the 21st year (Source: LIMRA).
My rebuttal to that: "If you know the day you are going to die, buy term insurance the day before!" In our comprehensive planning approach at Peachtree, we believe in the values that whole life insurance offer to an individual's financial plan. Why? It is loaded with guarantees that we need to stabilize and complete the overall plan. If properly structured, the death benefit of the policy is guaranteed be paid to the chosen beneficiaries, and equally as important, the cash values inside the policy will grow at a guaranteed 4% rate of return. Higher rates of return in the form of dividends paid to the policy could be greater, and historically have been, but they are determined by each company on an annual basis and are not guaranteed.
Another insurance company offered product that offers guarantees is a variable annuity. Again, another product that is scrutinized by the "financial entertainers". Why? Because they say the fees are higher than other investments...and yes, they are right...but there's a reason why, as there are underlying guarantees that are beneficial to the client. If I have a client that is 50, and they have an IRA in mutual funds worth $100,000, what will it guaranteed to be worth at age 65 and what will their guaranteed retirement income be? I used to be criticized in the 1990s for using 10% as a hypothetical rate of return. "It's too low...surely I can get more than that!" The 2000s have been a little different as in looking back at the last decade, 6% is often perceived as "too aggressive". BOTTOM LINE: Just as "There is no crying in baseball." (Thank you Tom Hanks)...there are no guarantees in mutual funds. If you can find them...let me know...please!
So...simply put, a variable annuity is a product where the investments are made up of mutual funds, mainly in models of conservative, moderate, or growth risk parameters. The funds work just like a regular portfolio of mutual funds...they go up and down with the market. However, there are underlying guarantees offered by the issuing insurance company, and they vary by company.
Same scenario, different methodology. Client, age 50, $100000 IRA in mutual funds inside a variable annuity with underlying guarantees. If I am trying to calculate guaranteed income in retirement, now I can plan with certainty. I know that the underlying guarantee in the annuity says that over a 15 year period, which gets me to age 65, for purposes of taking guaranteed withdrawal benefits (A.K.A retirement income), the account will be guaranteed to be worth 250% greater than the original amount.
In this scenario, with certainty, I can plan for a guaranteed amount at age 65 of $250,000. That's a 6.3% average annual return, by the way...which was too aggressive in the last paragraph!! In addition, I can plan for the client to receive guaranteed annual income of 5% for his life which equals $12,500/yr. I can do this with certainty, and guarantees backed by the issuing insurance company. This illustration is a simple "worst case scenario" as I have all of this in writing in the brochures and prospectus of the annuity contract.
The best case scenario is that we somehow find ourselves back into a Bull Market...whenever and if ever that might be...and the investment portfolio grows greater than the 250% guaranteed amount. The client can take that larger amount and still take a 5% guaranteed lifetime income. Regardless of either situation, I can plan with certainty and not speculation. The word "hypothetical" doesn't come into our planning whatsoever in this scenario.
There are certain terms I have used that make this article relevant, and suitable for me to share with you. Two of the most scrutinized products in the entire financial planning arena are the two that I've shared with you. My thought is that they are often times the most misrepresented and misused products offered by financial sales people. The words I want you to pay attention to in this piece are "properly structured", "comprehensive planning approach", and "hypothetical". I used the word "guaranteed" 28 times including this last one, so hopefully I'm getting my point across.
I live by the phrase "people always criticize what they don't understand", and that's why I finally wrote this piece...that, and the friend I had coffee with this morning said I should as she would enjoy reading it. As always, I'm here to serve, and to deliver what I think is the honest truth...and I welcome your comments, both pro and con.
Thanks for your continuing readership...
In Search of Guarantees
mentioned the words "life insurance" doesn't mean you should stop reading. This is about the word
12/31/2011
It's Going to be a Groundhog Year
It’s mid-December and I’m listening to Christmas music so I am in the best mood as I can be as I write. 2011 was a challenging year. Between Capitol Hill, Wall Street, global unrest that we’ve never felt before, and the economic ripple effects of 2008 still being felt, it was difficult to “think happy thoughts” as one of my golfing buddies has said to me occasionally on the course. Maybe you felt that way…maybe you’re still feeling that way…
I went back through my writings for 2011 and it was a lot of hardcore stuff. I truly believe that traditional financial planning is no longer in your best interests and continues to be perpetuated by writers for newspapers and magazines, “financial entertainers”, company product brochures, and a lot of other people that aren’t licensed to sell anything to anyone anywhere. It’s all painted with a lot of warm fuzzies about this utopia that we enjoyed in the 80’s & 90’s and are unlikely to see again for the foreseeable future.
Remember the movie “Groundhog Day” with Bill Murray? When he kept repeating the same day over and over and over? That’s what I mean by this month’s title. 2012 will be similar to 2011. If you disagree, then someone please give me some facts and ideas as to how it will be different? It seems Congress can’t get along with each other, it’s an election year, which means nothing will get done by our voted officials, and the global economy is…well…volatility reigns…let’s just leave it at that…
I’ve written about Einstein’s definition of insanity numerous times. So what are you to do to get through this “Groundhog Year” and avoid the definition? Forget resolutions…I’m talking about your money, your future, and your family. Here are some thoughts…some are easy…some will take some work and a lot of thought…and some are just plain ole common sense.
1. Get yourself organized! Online banking is great, but an electronic system such as Mint.com or Quicken will show you exactly where your cash flows are going. You might be surprised!!
2. Are your wills up to date? Do you even have one? Do you know what happens when someone dies? It’s time to learn. Its ridiculous how many people don’t have wills, so get it done! I’ve got a list of attorneys that will be glad to talk to you that specialize here.
3. Review all of your insurance programs. People tend to buy insurance based on cost and convenience…which can result in disaster when what they actually own is put to the test. Low deductibles mean higher monthly costs. In the event of a bad scenario, know exactly how much protection you are paying for. Chances are it’s not enough. Term insurance runs out. Group life and disability plans are cheap for a reason. There could be a potential recapture of hundreds of dollars just from that simple review…and potential benefits in the millions!
4. SAVE MORE MONEY!!! The average US savings rate hovers around the 2-4% range (Source: US Dept of Commerce). You need to be saving at least 10-15%...20% is where our firm likes our clients to be. The only way I can do it is monthly drafts from my checking account. If it’s in my account & not stashed away somewhere, I’ll spend it. The interest on savings is irrelevant…just start putting $$$ away!
5. Recognize that we are still in the early stages of a BEAR MARKET. If you chart the S & P 500 since 2000, we are at a 0-1% return over the eleven year period and it could be well into 2020 before we see another Bull Market. (Source: Ned Davis Research) Yes, from 1982-1999, you could expect average annual returns of 17%, but that was then. What are your strategies for the financial goals you have (college funding, retirement, etc.) when there are no returns? (HINT: Click on the Sailing & Rowing logo to validate what I just said.)
6. Recognize the difference between TAXABLE LATER and TAXABLE NOW. Given $14,000,000,000,000 of governmental debt and $68,000,000,000 of money owed in Social Security, Medicare, government employee pension & healthcare plans, do you really want to throw all of those $$$ in your 401(k) into the future where inflation, a declining workforce, and an aging population could eat away at the worth of those assets?
7. Seek to learn more about tax advantaged investments…there are more available to you than you think!
8. Truly think about where you are in your financial life cycle? Are you in Accumulation mode? If you’re like me and are over 50, you’re probably thinking about Preservation mode. If you’re closer to retirement, Distribution is where you should be focused. Lastly, what is your Legacy? Many of my small business clients are focused on “Exit Strategies” from their business. What is your “Exit Strategy”? If you don’t have one, one will be chosen for you…it’s called Life Happens.
9. GET OUT OF DEBT. I’m talking strictly about consumer debt. Mortgage debt doesn’t count in my mind. Tax deductible mortgage interest is about all you have left to claim on your tax return. Yes, it’s post-Christmas, so pay the cards off. This is one of the few areas I will agree with the “financial entertainers”…There I said it!!
10. “Rinse, Lather, Repeat”. …just like the shampoo instructions…keep these thoughts in your mind, and never stop the process…and get someone to help you (Shameless self promotion, by the way.) You’ve probably got enough financial products, but they are like a junk drawer with no coordination and a lot of product pitches thrown in. Your car insurance agent will never talk to your investment advisor who will never talk to your banker…so who determines what is best for you & your family?
OK, I’m stopping at 10…that’s enough! I told you some would be hard and some would be common sense…as always, I’m here…and everything you’ve just read is what we do here at Peachtree Planning. I wish you a wonderful Groundhog Year….oops, I’m sorry…2012…
12/06/2011
Memories of the Sears Wishbook
What is it about Christmas that creates such nostalgia? I remember when I was a kid in the 60’s, around the first of November, my brother David and I would impatiently wait every day for the mailman to deliver the first true signal that Christmas was coming….The Sears Wish Book! Hopefully, you’ve just smiled…for whenever I mention this to someone, there’s a nice warm feeling about hearing those words…sort of like Homer Simpson when he thinks about donuts. I found this cover of the 1966 issue…that would have made me eight & my brother David six…and I sure don’t remember our catalog looking this nice…ever!
I remember Mom trying her best to help us avoid a fight when determining who got the first shot with it. I guess she was lucky that it was just the two of us. We didn’t have a sister, so the girls’ section usually wound up immaculate. However, the boys’ section was altogether different, as we usually studied it line-by-line, page-by-page. It was dog-eared, circled, marked up, numbered, prioritized, and written in by both of us. If we had spent as much time with the World Book encyclopedias (there’s another memory for you) as we did with this catalog, we would have been considered child prodigies. I guarantee you that I could find that football game with the vibrating field in about 30 seconds or less!
My memories take me back to the Sears & Roebuck on Central Ave. in Knoxville, which was almost identical to the old Sears store on Lafayette St. here in Nashville. We would always walk through lawn and garden, through the appliance section, into the main store, and right into the candy counter. Most times, we got dragged there for school clothes (Yuck!), but after that book came in the mail, we knew exactly where we were going….downstairs to the Toy department…and to see the big guy…the head honcho, the one guy that truly understood what that Wish Book meant to us…Santa Claus!
Our experiences with Santa weren’t as dramatic or tragic as the kids in “A Christmas Story”, but the memories of that Sears store are etched in my mind forever… as are the framed pictures of me and David on Santa’s lap in my home. As I watch those old Super 8 movies of our childhood, (converted to DVD, thank you) I remember David and I on Christmas morning in our bedrooms, both feeling like two thoroughbreds in the gate, just waiting for Mom to give us the “all clear sign”. It wasn’t Christmas without Dad and his movie camera with that light bar that had 10000-watt bulbs in it. We still laugh about being partially blinded by it trying to get to our presents.
Today, Christmas in so many ways is so different. The Sears I remember is gone. The Wish Book now has an I-PAD app. This fall, both Mom and Dad have already proclaimed “Don’t get us anything as we don’t need anything!” Yeah, whatever. It’s probably going to be a “point & click” shopping spree online and gift cards for all…with a few surprises thrown in! Last year, David asked for & got no telling how many E-Bay gift cards. I think he had spent all of them by Christmas afternoon…me, I’m more of an Amazon.com guy.
I consider myself a blessed man in that for as long as I can remember, the Carden family has gathered around the tree in my parents’ living room, all of sitting in the same exact places as mandated by Chase & Courtney, my nephew & niece. It’s their job to hand out presents and we go around the room, opening gifts one at a time. Dad doesn’t get as much chocolate as he used to, but it’s a sure thing he’ll get it. In spite of their proclamation, Mom & Dad usually are genuinely surprised. As Mom says, after 59 years of marriage, it’s hard to surprise Dad…but we always seem to succeed. Besides, being sneaky is half the fun of buying gifts in the first place.
Yes, Christmas as I knew it as a kid will never be the same. My Wish Book is now a personal journal of words, thoughts, experiences, emotions, goals, wants, prayers, and dreams. The only pictures in it are those created by my mind and my heart. Christmas today is about family and friends. My clients seem to become my friends, and sometimes my friends become clients…and all of them become a part of my own personal family.
So, with all my heart, please know if you’re reading this, that you are a part of my Wish Book, and I wish you all of the love, hope, and joy of this Christmas and Hanukkah season.
Regards,
Brian
Brian_Carden@PeachtreePlanning.com
10/20/2011
"You Are Here"
It’s been a challenging year for me physically. For a guy that prided himself on being in pretty good shape throughout my life and never spending a night in the hospital since my parents took me home after being born, I’ve found myself having three knee surgeries in the last year, the most recent being a total knee replacement in August. Running was always my safe place, my comfort zone, and the one thing that I could count on to help me maintain my sanity, both physically and emotionally. It’s been an eye-opening experience to say the least…but then again I ran my first cross country race in high-top Converse as Adidas hadn’t been imported yet & Nike had not been created back then.
Recently, our office went to Atlanta to our corporate office for our quarterly study group and 2 days of great meetings. Afterwards, I needed some quiet time, and also needed to walk to get the stiffness out of my new knee joint…so I went to one of the malls as it was raining outside. As I got started, I stopped at one of the information stations to see the layout for my walk. Luckily for me, there were three levels so I could window shop & exercise at the same time. (No, I didn’t practice any “retail therapy” while I was there!) There were several information booths throughout the mall. Amazingly enough, these stations must have been psychic as at each one, it told me one thing…”YOU ARE HERE”. They knew exactly where I was! How about that?
So where am I going with this month’s rant, you ask? Today, YOU ARE HERE TOO! more than likely, at some point in your past, either someone or something told you that at this point in your life, be it age, occupation, or educational qualification, that as of right now, you should have a net worth of a certain amount, have a certain balance in your retirement accounts, savings accounts, etc. Very possibly, if you’re divorced like I am, or single like a bunch of my close friends, maybe you thought you would have had a great relationship with someone and had the national average of 2.3 kids. Maybe you thought you should have been retired by now. Who knows where you fit in this…but I know you fit somewhere! The sad reality of this is that all of these emotional benchmarks were created…and perpetuated…either by history, the media and their “entertainers”, mathematical calculations, or perhaps by someone like a parent or sibling that had all of the best intentions for you.
I remember the days of 401(k) enrollment books where a participant could use a paper slide and calculate how much X PERCENT of their income saved annually & compounded at either a 10% or 12% rate (8% was too conservative back in the 90’s) and the number at age 65 was astounding. There is an emotional concept in investing called “ANCHORING”. This is where you become emotionally “anchored” in either a stock price or an account balance. Example: You bought XYZ mutual fund with a $50,000 investment 5 years ago. If it’s worth $75,000 today, and the most logical thing to do is sell it, take your profits, and reallocate the proceeds, you say “Brian I can’t sell it! Look at the capital gains I’ll have to pay!” If it’s worth $25,000 and it’s time to sell it because logic says it wasn’t a good investment to start with, you say “Brian, I can’t sell it! It’s going to come back!” “Past performance is not indicative of future results, right?”…they say that for a reason…
The other example of ANCHORING probably applies more to you. I remember meeting with a business owner a few years back. I felt I could help him, but in our conversation I learned that he felt like a failure because somewhere in his psyche, he should have been worth $1,000,000 at age 40, and at age 45, he was nowhere close. He was successful in his family life, and his business had the ability to grow exponentially, but since he didn’t hit that emotional benchmark, he preferred to bury his head in the sand rather than explore strategies and concepts with me that might have gotten him back on that mathematically driven thought. In my mind, he cheated me out of an opportunity really to get to know him, impact his life, his business, and his family.
Me, I’m still bothered occasionally by “shoulda, woulda, coulda disease”. I’ve moved past it, but it’s hard to think of “what might have been”. I’ve paid my share of life tuition on some of the decisions of my life. Some days it’s “life tuition”…some days it’s “stupid tax”. Those words “if only”, “perhaps”, and “what if” will screw you up every time.
So do you have a set of numbers in your head that have become “unreachable or unrealistic benchmarks”? If you do, who are you sharing them with…if anyone? Money is not math or financial products. Let me emphatically repeat that…Money is not a calculator, some mutual funds and insurance policies!! Those things are needed, sure, but by themselves, they won’t fix what you’re really, truly wanting for yourself & your family!! Money is a series of economic strategies, each with their own capabilities. Each strategy has to have a “worst case scenario” and “best case scenario” played out for optimum efficiency or deficiency.
Just like Peyton Manning at the line of scrimmage…money has to be nimble and be able to move as the defense presents itself (a.k.a. THE ECONOMY). Just as he calls one play in the huddle, observes where another might be more efficient as he sees his opponent’s strategy, and finally executes what he feels will be the play…or strategy…with the greatest probability of success…that’s how your money has to work for you during these unforeseen and unpredictable economic times. Traditional financial planning, like “buy term, invest the difference”, and “maximum funding your 401(k), you’ll be in a lower tax bracket when you retire” is like Peyton yelling to the defense, “Hey, we’re running it up the middle, you guys, and it’s gonna work this time!”
Here’s the deal. If you personally know me, hopefully you know I’m a pretty good guy & walk a fairly strong walk…which means I do all I can to live through my actions and not my words. I’m Gene Carden’s kid remember? I was trained by the best! If you’ve been a loyal reader for the last eight years and we haven’t had the chance to meet, or maybe haven’t seen each other in a good while…and I’ve given you some consistent things to think about during these times…then my words have to suffice as my bond. I’ve said it for years, and I stand by it every month…I can make an impact in your life, your financial life, and the lives of those around you…if you will let me.
Right now, “YOU ARE HERE”. You can’t go back and do anything any differently…but you can sure do something going forward…but you have to do two things: make the decision to hit reply, and then get out of your own way so we can openly work together to accomplish everything you want & desire. If a Starbucks meeting is the first step towards us talking, then the latte’ is on me.
As always, thanks for reading,
Brian
Brian_Carden@PeachtreePlanning.com
09/07/2011
OK What Am I Supposed to do Now?
I am always so appreciative when clients and friends comment back on my writings. It is nice to know that after this many years, I’m still putting stuff out there that is worth a few minutes of your time. Last month’s piece "OK, Now I’m Really Scared" was actually written well in advance of the debt ceiling crisis, the S & P’s downgrading of the government (late on a Friday afternoon after market close, which was poor timing in my opinion) and of the stock market "soaring and plummeting" as a reaction to both of these items .
The title seemed to have a little karma working for me as the facts that I wrote about had little if any to do with what you thought I was actually scared about…but boy, did it cause a firestorm of frustration regarding all that is going on in our country. I ran into a friend at the Ryman the other night and instead of saying hello, he says "Thanks for the uplifting commentary, Brian! I wanted to get a razor out and slit my wrists!" Of course, he said it with a smile as he was shaking my hand, but it wasn’t the most optimistic piece I’ve ever written, was it? I don’t apologize for telling the truth, by the way.
So…What are you supposed to do now? It depends on what you’ve been doing. We all know Einstein’s definition of insanity…doing the same thing over and over expecting different results. There’s a good chance that if you’ve been following some of the financial myths out there, you’re not too far from insanity and didn’t know it. So, let’s get started. Let’s talk about your liquid cash. "Cash is king, right?" Financial planning 101 says save 3-6 months of your annual income, right? So where are you putting it? First of all, Ben Bernanke, the chairman of the Fed has come out and boldly made the statement that no changes will be made in the bond rates for the next two years. This means that you will see virtually no returns on your savings accounts, money markets, and CDs for the foreseeable future…that is if you consider 1/10% annual yield a return. In a nutshell, he’s saying that you will receive no reward for saving it and not investing it. He’s forcing you to take more risk in order to get a greater return. My question is "Do investors really want to take more risk in this environment?" People are starting to save again and the government is going to penalize you for saving and seeking "safe investments". Really, are you kidding me????
Here’s another point worth discussing. If you were to invest $1 today, how would you want the earnings? Taxable, tax deferred, or tax free? Taxable gives you the greatest amount of liquidity. However, are you aware that you can lose money in stocks and stock mutual funds and still have to pay a 1099 for dividends, interest and capital gains? Remember 2008 when your portfolio was down 30-40%? It wasn’t that long ago. So, in order to avoid that scenario, you fund your tax deferred 401(k) account. Here’s a new "Cardenism" for you: Do you know what the "K" stands for? Konfiscation. (…just like the "N" on Nebraska’s football helmets stands for Nowledge.)
Here’s my take on your 401(k) & how I see it playing out. In order to avoid all of the current federal income taxes you are facing today, you are going to take that $1 and put it into a "tax-deferred account". People get huge amounts of immediate gratification from this action. However, at some point in the future…whenever that is…you are going to take that $1 and spend it. You might pay a 10% penalty for premature withdrawal prior to age 59 ½, who knows. TODAY, that $1 is worth exactly that…$1. You can take it anywhere and buy that amount of goods and services. However, you are willing to take that $1 and throw it as far into the future as possible where you are hoping & praying that it will buy you more than it will today. You’re hoping & praying that income tax will be less when you take it out than when you deferred it…that inflation (or purchasing power reduction) will be such that your $1 will buy more than it would today…that this volatile stock market that once returned an average annual yield of almost 17% from 1980-1999 (Source: Ned Davis Assoc.) will come charging back to give you that return again…even though the S & P 500 Index has returned exactly ZERO PERCENT FOR THE LAST 10 YEARS through 7/31/11. These are both actual & average annual returns by the way…ZERO, NONE, NADA!!!
How about tax-free investing? Most people choose that alternative over taxable and tax-deferred. I’ve yet to meet someone that isn’t worried about income taxes. However, they immediately think of municipal bonds, where the earned interest is possibly government & state income tax free. Many claim proudly "I make too much money to qualify for a ROTH!" Funny that when I talk about economic strategies and concepts that go "outside the box" they default back into product mode, or at best, financial strategies based on myth.
Now I ask you: given all of the wonderful cheerful factoids I gave you last month, do you think that taxes are going up or down???? Given what you are feeling right now about your own personal confidence in the financial markets, do you actually expect anytime soon to see the 17% average annual yields from over a decade ago? If you have drunk the cool-aid of the financial entertainers, then you are a firm believer of their financial myths, as they preach lower taxes, double digit returns, and a financial nirvana the likes of which are unattainable by common sense.
If you’re in panic mode right now…you should be. Emotion trumps logic almost 100% of the time. These are scary times that might continue into your grandchildren’s old age. History’s lessons aren’t going to fix this as we’ve never seen the political, financial, and global arenas collide like this ever before.
However there are strategies out there that are available to you. My role is to not only be the "professional explainer" of these strategies, but to guide you through the economic minefield of disasters you are facing…and will continue to face as long as we walk this big round ball. My statement to you remains constant and absolute: "I can help make an impact in your life and the lives of those you love if you will let me." It’s up to you at this point…
Best,
Brian
Brian_Carden@PeachtreePlanning.com
www.briancarden.com
08/17/2011
OK, Now I'm Really Scared August 2011
......before I was just concerned, by the way. I was in Atlanta at our corporate office for a quarterly advisor’s meeting and we had a guest speaker who discussed at length the current state of the US Government including the proposed budget and what the guesstimated future income taxes were going to look like. Here are the highlights of what I took away:
- 2010 Income taxes collected $1.4 TRILLION…estimated in 2016 to be $2.7 TRILLION…that’s close to doubling by the way. (usgovernmentrevenue.com)
- 2010 Federal Debt = $13.5 TRILLION…estimated in 2016 to be $20.8 TRILLION (usgovernmentrevenue.com)
- Amount of available currency in the US…1000 days ago - $829 BILLION…today $1.5 TRILLION. (US Treasury)
- Interest on the Federal Debt as of today = growing at a rate of $52,000,000 an hour, or $866,666 per minute…JUST THE INTEREST!! (usgovernmentrevenue.com)
- Current Federal spending of new dollars = $2 BILLION/hr. (usgovernmentrevenue.com)
- Current National unemployment is 9.1% (as of 5/2011). The current healthcare reform bill factors in a 4.51% unemployment rate. (healthreform.gov)
- Number of government employees making over $150,000 1000 days ago = 7,464…today = 82,034 (usgovernmentrevenue.com)
- In the last 10 years the value of the US dollar has decreased by 40%. (Reuters)
- Inflation has stayed stable around the historical average of 3%, but it doesn’t include food and gasoline…which are the two major items in my life that seemingly cost more every year. (inflation. us)
- Current Governmental unfunded liabilities, such as pension & healthcare benefits for government employees, civil servants, and military personnel, and also including Social Security & Medicare benefits currently totals $62 TRILLION…equal to $534,000 per household. (USA Today)
So if I read this right, and with an abundant amount of logic and controlled emotion, we’re pretty much screwed. I do not have a political bias in these numbers…unfortunately, they are what they are…and it’s apparent that we are going to be paying for it for many generations to come…and that taxes have got to go one way…UP! So given these facts, and knowing that tax brackets are probably as low as they will ever be going forward…what strategies are available? It’s not the paying of taxes that bothers me so much, but the thought of my assets being held for future confiscation by the constantly changing minds on Capitol Hill.
Traditional financial planning says defer as much of your income today as possible to save income taxes. Tax deferred retirement plans like 401(k) & IRAs only complicate the problem as what’s the point of taking a deduction at today’s bracket & throwing those dollars way into the future when I might be paying double what I could have paid today in taxes. Not to mention that the market isn’t giving me my 15% returns like the “financial entertainers” keep promising. If my home mortgage deduction is one of the few I still have, why is paying off my home earlier a benefit? Especially given that it is still 20% below its appraised value in 2008.
Hopefully you’re as scared as I am…Lord knows I don’t like feeling alone with thoughts like these. Maybe you’re intrigued as to what strategies are still available. Here’s a key point…all of the bullet points were based on Economics…not finances. You might think you can control finances…but you cannot control economics. Traditional financial planning doesn’t help you when faced with these issues. Economic planning does.
What a radical concept: Economic Planning. Economic Planning is taking hard cold facts and realities to help you truly understand the minefield of financial traps & pitfalls that you will be facing everyday for the remainder of your life. It takes into consideration the abundant amount of misinformation and myths you are constantly subjected to by the media, financial institutions, cable channels & websites. It addresses your fears about taxes, risk, inflation, the value of the US dollar, and penalties. It answers those questions that won’t go away…the ones that “keep you up at night”.
Show this to your CPA or “Your guy” that you work with …see what they say about all of this. Post it to the world & see what they think. I’m curious to know if I’m the only one that is reading these facts correctly. Did you notice how many times I said the word TRILLION in the bullet points? Just in case you’re interested, that’s $1000000000000. Do I have your attention yet?
Best,
Brian
"Walking Case Studies", July 2011
It seems like the amount of continuing education to which I’m subjected never ends, which means when it comes to my clients & prospects that’s a really good thing. I constantly have to stay on my game with regards to continuing regulations & ethics issues associated with being a financial advisor. In as much as it can be very time consuming, I appreciate the fact that my industry is always doing all it can to put the client’s needs first…and yes, once in a while I accidentally learn something too!
I’ve grown to dislike multiple choice questions immensely…never been a good test taker…ever. It’s a skill I don’t have. However, one of the components of all of this education has been working case studies. This is where I get to roll my sleeves up & “have at it”. They give me a ton of data, including an overview of the client’s demographics, their balance sheet, income statement, cash flow statement, and a lot of information on their assets, investments, retirement plans, and insurance coverage. In addition, I learn what the client’s needs, wants, goals, and desires are about. The why & what of what they are doing is paramount in these cases.
Once all of the material has been read and the important data highlighted, then I do what I enjoy the most, which is:
Evaluate ALL of the strengths & weaknesses regarding their money.
Create strategies & stress -test them to confirm their effectiveness.
Exploit every ethical and legal option available in the spectrum of the financial world.
Present & implement a series of recommendations that more closely correlate what they were currently doing to what they should be doing…and most importantly, what they said was important to them.
Did you notice that there wasn’t a single thought in those bullet points that said “sell a product”? They will be needed to implement what has been laid out in my recommendations, but there’s not a hidden bias towards any specific agenda that says “THEY NEED BETTER MUTUAL FUNDS” or “MORE INSURANCE IS THE SOLUTION”. It’s not how I work anyway. You might feel differently based on your past experiences. Too many in my business work from the thought process of “If all you have to sell is a hammer, everything starts to look like a nail.” As one of my peers has said about his experience before he joined Peachtree Planning “People in our business called themselves “Financial Planners” but there’s never been much planning going on out there”. Sadly, too many firms have a bias of some type. I can say that because in this firm, we regularly see it in our prospect’s data as we take them through our planning process.
To me, if you are reading this, you are a “walking case study”. If I had your financial data, there is a high probability it would look very much like these case studies. Some situations are very complex, some are very simple…it just depends as rarely are two clients exactly alike. We have a process here that insures that every bullet point is completed and executed to the best of our abilities. If we are at the implementation stage with a client and a 50 lb of nails needs to be put into place to make their planning more efficient and have a higher probability of a positive outcome, I’ll go to Home Depot and bring back a big bag of nails.
It’s that simple…I practice applied common sense on a daily basis. If the University of Tennessee offered a graduate program in it, I would have the shingle on my wall. Just like these case studies, there are areas in your financial life that may need help. We’ve yet to meet anyone that we haven’t been able to make a true impact on their lives, and I would relish the opportunity to show you how we can do the same for you. You know the drill…just hit reply & let me know.
By the way…I always do very well on my case studies…
Best,
Brian
08/04/2011
"OK, Now I'm Really Scared" August 2011
…before I was just concerned, by the way. I was in Atlanta at our corporate office for a quarterly advisor’s meeting and we had a guest speaker who discussed at length the current state of the US Government including the proposed budget and what the guesstimated future income taxes were going to look like. Here are the highlights of what I took away:
- 2010 Income taxes collected $1.4 TRILLION…estimated in 2016 to be $2.7 TRILLION…that’s close to doubling by the way. (usgovernmentrevenue.com)
- 2010 Federal Debt = $13.5 TRILLION…estimated in 2016 to be $20.8 TRILLION (usgovernmentrevenue.com)
- Amount of available currency in the US…1000 days ago - $829 BILLION…today $1.5 TRILLION. (US Treasury)
- Interest on the Federal Debt as of today = growing at a rate of $52,000,000 an hour, or $866,666 per minute…JUST THE INTEREST!! (usgovernmentrevenue.com)
- Current Federal spending of new dollars = $2 BILLION/hr. (usgovernmentrevenue.com)
- Current National unemployment is 9.1% (as of 5/2011). The current healthcare reform bill factors in a 4.51% unemployment rate. (healthreform.gov)
- Number of government employees making over $150,000 1000 days ago = 7,464…today = 82,034 (usgovernmentrevenue.com)
- In the last 10 years the value of the US dollar has decreased by 40%. (Reuters)
- Inflation has stayed stable around the historical average of 3%, but it doesn’t include food and gasoline…which are the two major items in my life that seemingly cost more every year. (inflation. us)
- Current Governmental unfunded liabilities, such as pension & healthcare benefits for government employees, civil servants, and military personnel, and also including Social Security & Medicare benefits currently totals $62 TRILLION…equal to $534,000 per household. (USA Today)
So if I read this right, and with an abundant amount of logic and controlled emotion, we’re pretty much screwed. I do not have a political bias in these numbers…unfortunately, they are what they are…and it’s apparent that we are going to be paying for it for many generations to come…and that taxes have got to go one way…UP! So given these facts, and knowing that tax brackets are probably as low as they will ever be going forward…what strategies are available? It’s not the paying of taxes that bothers me so much, but the thought of my assets being held for future confiscation by the constantly changing minds on Capitol Hill.
Traditional financial planning says defer as much of your income today as possible to save income taxes. Tax deferred retirement plans like 401(k) & IRAs only complicate the problem as what’s the point of taking a deduction at today’s bracket & throwing those dollars way into the future when I might be paying double what I could have paid today in taxes. Not to mention that the market isn’t giving me my 15% returns like the “financial entertainers” keep promising. If my home mortgage deduction is one of the few I still have, why is paying off my home earlier a benefit? Especially given that it is still 20% below its appraised value in 2008.
Hopefully you’re as scared as I am…Lord knows I don’t like feeling alone with thoughts like these. Maybe you’re intrigued as to what strategies are still available. Here’s a key point…all of the bullet points were based on Economics…not finances. You might think you can control finances…but you cannot control economics. Traditional financial planning doesn’t help you when faced with these issues. Economic planning does.
What a radical concept: Economic Planning. Economic Planning is taking hard cold facts and realities to help you truly understand the minefield of financial traps & pitfalls that you will be facing everyday for the remainder of your life. It takes into consideration the abundant amount of misinformation and myths you are constantly subjected to by the media, financial institutions, cable channels & websites. It addresses your fears about taxes, risk, inflation, the value of the US dollar, and penalties. It answers those questions that won’t go away…the ones that “keep you up at night”.
Show this to your CPA or “Your guy” that you work with …see what they say about all of this. Post it to the world & see what they think. I’m curious to know if I’m the only one that is reading these facts correctly. Did you notice how many times I said the word TRILLION in the bullet points? Just in case you’re interested, that’s $1000000000000. Do I have your attention yet?
Best,
Brian
05/27/2011
R.E.S.P.E.C.T
I’ve written enough financial stuff for a while…so I thought I’d take a break and just write what’s on my mind…and no, the title is not an acronym for anything…I’m not that creative today. When I was home in Knoxville recently for my niece’s high school graduation (congrats again Courtney!), Dad & I had another of our good conversations. At 86, I don’t take any of these talks for granted. He told me he would give anything to just be able to get up on Monday morning and “make calls” as he deemed it…just go see people & do what he could to help them. He did it every day since he got out of college in the early 50’s, and he misses it.
Dad’s “Golden Rule” was drilled into my head growing up…”To have a friend, you’ve got to be a friend.” It’s permanently embedded in there and I can’t get rid of it...nor do I want to. Dad worked in an era with no cell phones, fax machines, computers, blackberrys, I-phones, etc. He made his living calling on people, getting to know them, and doing whatever he could to take care of them...period. He said he never worked a day in his life…he just got up in the morning and went out and helped people. When you called Dad, it was guaranteed that he would call you back as soon as he could…regardless of whether or not he wanted to talk to you or not! I told him that afternoon “It stinks being your kid.” Here’s why I said that…
Dad taught me to have a “high bar”…to live by what I thought was a simple standard of treating people…it seemed simple at the time. Today is a different world…and it all boils down to respect & the way we treat others. It seems that the new way of communication is non-communication. People don’t talk anymore…they text, or e-mail, or it seems these days, they don’t respond at all. A returned phone call used to be the standard…now it’s a luxury. Recently, I sent an email to a friend I noticed on Linked In and said that I had called him several times to see how he was doing and how his new career change was going. He responded with a huge apology and the words…”You would think as many times as I don’t get calls returned, I wouldn’t be doing the same to you.”
Don’t say you don’t do it…because you know you do…that one person that you won’t call back…and they keep calling. I am a huge disciple of the Sandler Sales System. They saved my career over a decade ago. There is a plethora of great thoughts that came from those classes, but in particular, two redeeming thoughts are carried around with me: “NO is okay…tell them NO…they will be good with it…but just be honest enough to say NO.” Secondly, “People have been told it’s OK to lie to salespeople and they will still get into heaven.” Everyone laughs at the second one…but they know it’s true.
We live in an age of convenience and information…everyone carries a device that allows them access to the world in a few key strokes. We can be reached by anyone, anytime, anywhere. If you sell a product, offer a service, or just want to be a friend to someone, you probably feel as I do. Don’t you love it that when you see someone that hasn’t returned several of your calls, the first thing they say is “I’m sorry I haven’t called you back.”
We are all living on this big ball just trying to enjoy life while we are here, and do our best to live as good a life as we are capable. Our company motto here at Peachtree Planning is “Help some people, make some money, have some fun.” That’s pretty simple, isn’t it? Aren’t you trying to do the same thing…regardless of your occupation? I’ve said it before in my monthly rants, and I’ll continue to say it…”I can make a significant impact in your financial life…if you will let me!”
So here’s my challenge…and just try it and see if it really inconveniences you…for the next 30 days, when someone contacts you…personally or professionally…it doesn’t matter…just respond to them…leave a voice message if appropriate…if you’re too busy to talk or meet, let them know that & when a good time to call back might be…if NO is the right answer to their question…TELL THEM NO…it’s alright…just tell them something other than nothing at all.
It’s called respect…and it’s a part of Gene Carden’s legacy that I’m passing on to you. When Dad felt disrespected, he would often say to me “Son, if they only knew what I was thinking about them”…and now you know what his son is thinking…
Best,
Brian
Brian_Carden@PeachtreePlanning.com
05/02/2011
"It's All Greek to Me"
I’m having déjà vu flashbacks to my sophomore year in college…holding a lit matchstick in my hand, trying to recite the Greek alphabet before I got burned…the things I had to do to get a fraternity brother’s signature in my pledge book while trying to join Sigma Alpha Epsilon.
Being a Financial Advisor is a challenging occupation…well it’s not really an occupation to me anymore as after 29 years, I’ve come to realize that I am truly called to do this kind of work. I’ve also come to know that the creative right side of my brain dominates the analytical left side. When I go to advisor’s conferences and to roundtable meetings with money managers, most of the people in the room are very much left brained people. There is lots of talk about stuff that sometimes makes my head explode, including tons of math & algebraic equations. When they start talking about Algorithmic and Quantitative Trading, I’m borderline suicidal at that point. I understand it…I have to…but I’m always thinking about how I can explain it to you!
There are terms that I’ve come to embrace that do envelope both parts of my gray matter…being the cerebral guy that I am…and they are the first two letters of the Greek alphabet: ALPHA and BETA. Both terms are very important for you to know. I’ll keep this as right brained as possible…I promise!
ALPHA is the excess return above what you are hoping to get. That means if you are trying to get a return equal to the S & P 500, and you get more than that…that’s ALPHA. Mutual fund managers get their bonuses by trying to beat a benchmark like this, and they are always “in search of ALPHA”. BETA is the volatility, or risk, associated with your investments
Example: The S & P 500 always has a BETA of 1.0. It’s a primary benchmark in the investment & mutual fund world. So the 10 year average of the S & P 500 is 2.42% with a BETA of 1.0. That’s your benchmark. So for the same period, if your investment account got a 1% return and the calculated BETA was 1.3, then it’s obvious your strategy is backwards: Too much volatility and minimal return. The reward didn’t equal the risk!
People everywhere are “chasing high returns”, financial entertainers and even financial advisors are putting themselves out there that they can get you these high returns. First of all, if the S & P 500 has only averaged 2.42% for the last decade (Source: Standard & Poors), where are these returns? Secondly, assuming they are out there, how much risk are you willing to take to try to get them? Remember 2008, when your investments were down 40-50% because you were focused on the ALPHA and not the BETA? The way I see it, most financial strategies are flawed as their goal is not manage the risk (BETA), but to seek the highest returns possible (ALPHA). It hasn’t worked for the last decade, and it’s apparent to me it’s not going to work going forward. Again, your strategy is backwards. You’re chasing returns and you need to be focused on the risk, because the returns simply haven’t been there!!! That’s where I come in. You need better strategies.
I’ve talked about Sailing & Rowing before & you need to watch this video. Since this Bear Market started in early 2000, you should have been ROWING as Rowing strategies include ALPHA assets because the returns from a down market have come from ROWING. If you’re SAILING, which most people are, Sailing strategies are BETA assets, as they create volatility and focus on risk.
Whew…how did I do? Hopefully I didn’t get too technical. If I did, here’s a synopsis: In your investment portfolios, you’re probably focusing on the returns & not the risk…that’s backwards in this market. To learn more, go to my website, www.briancarden.com & watch the “Sailing & Rowing” video. Once you’re done, call me & we can take the Greek out of your emotions, your investments, and maybe your planning.
As always, thanks for reading…Lets see…alpha, beta, gamma, delta, epsilon, zeta, eta, theta………
Best,
Brian
03/29/2011
Really?...Are You Kidding Me?
It never ceases to amaze me just how people think, what people do, and how they are affected by those that have no reality about what they are talking about. There are so many financial myths out there that can be completely blown to bits by reality, but they have been there so long that they’ve become common practice and therefore we as a society believe that they are true…and worst of all, that they actually work for us! It’s gotten to a point of ridiculousness.
I love some of today’s comedians in the way they observe, critique, and comment on what they see in today’s society. Some of my favorites are Dennis Miller, Chris Rock, and Lewis Black. When I listen to them, they not only make me laugh out loud, they make sense. When they are on stage, it seems as if I see the same thing they do…they just have a better way of delivering it. So, for this month, I thought I’d share some documented facts and figures that I keep in my head…you know the stuff that makes me fun at parties. If you shared a financial thought with me that I knew to be a myth, if I knew you well enough, it’s what might come out of my mouth after I said “Really? Are You Kidding Me?”
- “I expect a 10-12% return in my mutual funds.” Really? Too bad it’s not 1982 again as I might buy that. Average rate of return from 1982-2000 was around 16.8%. However, from 2000-2010, when you are doing all you can to grow your accounts…ZERO PERCENT. The only increases have come from your employer match! So what is your strategy now? (Source: Ned Davis Research)
- After 2008, when I lost 40% in my investments, I moved everything into bonds to be safe.” Really? 80% of all mutual fund inflows from the middle of 2008 through the end of 2010 went into bond funds. (Source: American Funds) From the bottom of the market in October 2008 to the current levels in February 2011, the S & P 500 went from a low of 683 to a current level of 1311…almost 90% growth in 14 months. (Source: Altegris Investments).
- “I expect to retire in a lower tax bracket.” Really? We are at the lowest marginal tax brackets since the Great Depression. 10%. Given that we are $40,000,000,000,000 in debt (that’s trillion, by the way), how can Uncle Sam let it go any lower? The highest marginal brackets were during the Roosevelt administration at 90%!!!! Could we go back there again? (Source: Internal Revenue Service)
- “My 401(k) is the best asset I have.” Really? How liquid is it if you need cash for a life event, such as your children’s education, or a new career opportunity? What happens if you lose your job due to outsourcing or off shoring? Maybe it’s time you learn more about “Use, Enjoyment, & Control”. What would you say if I told you it might be the worst asset you’ve got?
- “My advisor is my next door neighbor’s grandson’s fraternity brother…and I haven’t seen him in years…but I’d never leave him!” Really? So he sold you some mutual funds and that’s about it? So how’s that working for you? Still planning on retiring at 65 on that strategy?
- “I have all my investments at ___________(pick no-load company) because they have very low management fees and I get free advice from them. Really? So how’s that 1-800 headset rep doing managing you through this slumbering Bear Market? Given his vast experience, what is he doing to advise you through all of this global volatility that we’ve never seen before? Is it just me, or have you ever seen someone working there with gray hair?
- “I think the market has recovered and that we will see double digit returns for quite a while.” Really? What financial entertainer told you that? Let’s see…the government bailout money flowed through US financial institutions, and the printing of new dollars to flood banks with money to stimulate the economy (a.k.a. Quantitative Easing) might have worked for a little while. However, given that total unemployment is bordering on 20% (including actual unemployment, those that have stopped looking for work, and those “underemployed” that took jobs lower than their former employment) (Source: Dept of Labor), and that the dollar has lost 40% of its value since 2000 (Source: Genworth Wealth Mgmt), where do you see this miraculous recovery?
- “I pick my own mutual funds and stocks as I have as much research available to me as you do” Really? So how’s that working for you? In this technological age, you do have as much access as I, but here’s the deal…my job is not to be a “stock picker”, or to manage your money…that’s another financial myth. My job is to manage you…your emotions and your expectations. My role is to find opportunities in the financial world that meet the objectives that we’ve agreed upon and to exploit them in a beneficial way tailored to what you want in life. “A rising tide floats all boats”, and anyone can make money in a bull market…anyone. We have not seen a Bull Market in 11 years, and it’s anticipated that we will stay in this slumbering Bear until at least 2019 (Source: Crestmont Research).
- “Life Insurance is an unnecessary expense and the cheaper it is the better.” Really? The Life Insurance industry thanks you, because almost 98% of all “cheap term insurance” plans either lapse or terminate, resulting in lots of profit for them. If I showed you where utilizing cash value life insurance as a part of your overall comprehensive planning could actually cost you less than term insurance over your lifetime, and allow you to spend your assets more freely in retirement, would you actually listen? The sad part is that you’ll think I’m trying to make a commission to sell you insurance, but in actuality, if I do my job effectively, you will be the one that makes more money…that is if you will trust me!
Okay, that’s nine “Reallys?” in one post…probably enough for a while. I told you I was fun at parties! Do I have your attention yet? Traditional financial planning doesn’t work in this “New Normal”, just as traditional asset allocation doesn’t either. (See the attached white paper for more information.) Alternative strategies have to be exploited in your thinking, your investments, and your planning…and that is what we do…we think outside the realm of normal, because we know if it hasn’t gotten you there yet, it’s not going to! Remember Einstein’s definition of insanity? You’re doing it over & over and expecting the same results…chances are your current advisor is the one creating this for you. I can guarantee the financial entertainers are perpetuating this!
Just like a chess match, one move isn’t going to get you to “checkmate”…it’s a series of thought out strategies…each calculated for a “best case, worst case scenario”. That’s the way we approach financial planning, and we are very, very good at it. If you made it here, thanks for reading…I appreciate you! With that, I’ll close with my same eight words…”I can help you, if you’ll let me!”
The ball’s in your court…
Best,
Brian
Brian_Carden@PeachtreePlanning.com
03/08/2011
What I've Learned from 1983-2011…A Perspective
MARCH 2011
It’s scary to think I’ve been in this industry for 29 years…a good percentage of it was as a wholesaler for major insurance and investment firms, but still…I’ve been in and around it for almost all of my adult life. This after having said I would never be in this business while still in college. However, I thought it would be interesting to share what I’ve seen since I got my first securities license back in 1987. (Two months before the first “big crash” by the way.)
Back then, there were only “insurance agents” or “stock brokers” as financial planning as we know it today was in its infancy. The raging bull market from 1981-2000 was just starting to run and IRA’s, 401(k) plans, and mutual funds were just coming into popularity. My first company retirement plan was a profit sharing plan with an after-tax contribution option and if the law hadn’t changed in 1986, I would have had to stay there for 15 years to be 100% vested. My first mutual fund purchase had an 8.5% front end load. Luckily for all of us, that’s all changed.
When I first became a retail advisor in the early 1990’s, I had to pick the mutual funds for my clients. Diversification meant breaking the percentages into large and small cap stock funds, maybe a bond fund to reduce the risk of stocks, and the most I could put into International funds was 25%. Back then, the market was “sailing along”. You threw money in the market and it went up! My recommendations were based which fund family had the best past 3,5, and 10 year performance…or by what funds your company told you were available for you to sell. There really wasn’t a risk tolerance profile back then…people saw the double digit returns of the stock market, and wanted you to get it for them…and it was fairly easy during those Glory Days of the roaring 90’s.
Around 1990, a professor named Harry Markowitz won a Nobel Prize in Economics for his studies on “Modern Portfolio Theory” and how a broadly diversified portfolio could significantly reduce the risk of stocks while continuing to give reasonable returns. He said it wasn’t market timing or investment picking that made the difference, but that diversification and asset allocation were the keys to managing volatility (aka risk). I knew these types of portfolios were available, but in their initial stages, those offered catered to the higher net worth investors and the account minimums were in the $1,000,000 range. It takes the industry a while to adapt to new ways of thinking, but in the mid 90’s, when the mutual fund industry began to create model portfolios that fit the average American, I became a true disciple of his theories. It took the guesswork out of which funds to pick, and also allowed me to be an advisor and not a picker. My belief was and still is that my role is not to manage your money, but to manage you and your financial process. If you worked with me, there’s a high percentage chance you were invested in an actively managed portfolio model…and I was criticized by some for utilizing these strategies because they weren’t aggressive enough!
In March of 2000, the dot-com bubble burst. The market was driven to ridiculous highs based on investor greed. (Easy dot com…easy dot go!) Alan Greenspan, the head of the FED, (the guy that has his thumb on the pulse of the economy) said on more than one occasion, “The market is showing signs of “irrational exuberance””. This meant even he didn’t understand why it was doing what it was doing as it was defying common sense. Companies that in the final analysis had no chance of making a profit saw their stock go through the roof in a matter of weeks…only to be worthless later. So the raging bull market officially came to an end. All of those people that were taking way too much risk than they should all got absolutely hammered when the market corrected. For many, it was like a big “hail Mary” to make up for those years when they didn’t save anything and they saw the market as a way to get rich quick & retire well…at least that’s what they thought. So they headed for money markets and other accounts that they thought were “safe” only to find their accounts being eaten alive by purchasing power risk (aka inflation).
At that time, that was the first real major correction of the last 20 years, so everyone kept saying “Don’t panic, the market will come back…it always has!” However, you don’t really know you’re in or out of a bull market until Wall Street and the FED says you are. So, even though we’ve been in this current bear market for going on eleven years straight…with no signs of a real change, the media keeps relentlessly telling us that we are heading for happy days. So we keep plodding along, being told to “keep sailing, it will come back”. Financial entertainers even to this day, still use ridiculous hypothetical rates of return of 12-15% in calculating what future account balances will be worth down the road. CNBC seems to report two things on a regular basis: The Dow is soaring or the Dow is plummeting.
So we go back and forth during the last decade…or the “Lost Decade” as it’s come to be known as the average return in the S & P 500, the Dow Jones Industrial Average, and the Russell 3000 for that decade was exactly ZERO PERCENT. If we look back to 2008, as Yogi Berra says “It was déjà vu all over again!” If we thought 1999 wasn’t bad enough, we had no clue 2008 was going to happen. Just like the big Nashville flood of 2010, it was devastating…no one saw it coming…no one prepared for it…no one in their right mind could have predicted it would have happened…but it did! The US and global markets were down 30-40%. Despite my best efforts in keeping my clients’ investment portfolios properly diversified and managed specifically towards their tolerance for risk, everyone’s balances declined. Managed accounts, mutual fund portfolios, and variable annuities…all of them went down. Emotions superseded logic in the worst way possible.
Diversification was meant to have asset classes acting differently during market swings. Stocks go up, bonds go down, US goes down, International goes up, so on and so forth. That’s the way it was supposed to work! That’s what won the guy the Nobel Price for crying out loud!! However, when we needed it to work the most, it broke down. When asset classes should have reacted in an opposite fashion, almost all asset classes became more correlated. By the way, correlation is when two or more items act in the same manner. Note to self: What has worked for Mom & Dad for the last 59 years in building a wonderful marriage, won’t work in an investment portfolio.
Bringing this to the present…you’ve probably looked at your investment statements for the last year. Congratulations, you were probably up. The S & P 500 returned almost 15%...most of it in the 4th quarter. “Happy days are here again, right?” Here’s the part that is confusing…I’ve yet to read or hear anything from my various money managers as to why the market was up other than consumer spending was up and consumer confidence was stronger. Does that make sense to you? Is the market showing signs of “Irrational Exuberance” again? Wall Street can’t tell us. A manager that had a banner year last year is now pessimistic. One that was ultra conservative last year, all of a sudden is optimistic. We are still in a Bear Market, and will be there for several more years…that is the only thing Wall Street can agree on.
So, what have I learned? Here’s a list of only a few things. I’ve learned that:
The market is about as unpredictable as it’s been in my entire career…and it will continue to be for the rest of my career.
Those too many in our business claiming to be advisors are simply investment salespeople offering a false hope based on past performance and hypothetical future rates of return.
That a local advisor cannot effectively manage your money, multi-billion dollar globally based entities with teams of researchers & highly educated non-emotional specialists do…and even then, they get it wrong.
That a single strategy of “buy and hold” won’t work anymore. It takes so much more than that.
That “alternative investments” that were once shunned upon, such as currencies, commodities, and managed futures, need to be discussed as a part of your portfolio NOW.
That a group of economists can’t agree on anything…and rarely will never get it right.
That financial products are only a small part of the equation…if the financial strategies are not there, failure becomes an option.
That the more I think I’ve learned it all, the more I realize haven’t learned as much as I need to.
That common sense just isn’t that common anymore.
There’s no telling how long this list could get...good thing I’m only talking about my profession. Hopefully, I’ve been honest enough to let you see just some of what I’ve seen for all of these years. I’ll close with my seven word mantra, which is “I can help you if you will let me”. As always, thanks for reading…do me a favor…add someone to my monthly subscription list…maybe they need to talk to me.
Many thanks!
Brian
Brian_Carden@Peachtreeplanning.com
02/08/2011
What Type of Investment Are You?
If you were to categorize yourself, what are you: stock, bond, mutual fund, option, derivative…or maybe even a “credit default swap”...that nasty little thing that no one knew about that caused Wall Street to crumble? Which would you be? Here’s where the distinction lies...and it’s fairly simple to differentiate. If you are gainfully employed by someone else, I’ll call you a “W-2”. If you are Self Employed and a Business Owner, I’ll call you a “SEBO”, which is an acronym I’ve created for you. (Entrepreneur has to be one of the most overused words in this decade in my opinion.)
So, you are a W-2, your talents and skills are technically owned by your employer, and your productivity creates income for that employer. The only increase in your value comes with raises or cost of living adjustments. Therefore you are a BOND. Your employer “buys” you with a stated salary, and you generate profit for him. You have a feeling of some safety by being a bond, but it could be fleeting. Oh, in this volatile employment environment, technically, you are a “CALLABLE BOND”, as your occupation could be outsourced or “offshored” and your employer could claim your salary back as if he sold a bond.
As a bond, the only way to diversify is to invest into stocks. You are probably doing this already by funding your 401(k). It’s the norm of our generation. However, let’s look at the ramifications of what you are actually doing. The last 11 years have generated a zero average annual rate of return in stocks and stock mutual funds. It’s highly likely the only gains in your account have come from employer matching, and that has probably diminished as well over the last decade. I think it’s a fair assessment that income taxes won’t be any lower for the foreseeable future…so there’s a high probability that you could be setting yourself up for “reverse tax planning”…deducting in a low bracket and taking income from it in a higher bracket. We also know that trillions of dollars of investable assets are being “disinvested” into money markets and bond funds. 80% of all new mutual fund inflows in 2009 and YTD 2010 are going into bond funds. If you are one of these people, you are doing “reverse diversification”…meaning you are becoming a bigger BOND. If you cannot hear that lit fuse attached to your back, trust me, it’s there. Your bubble is going to burst. (Click my e-mail address at the bottom for instructions on how to diffuse your “bond bomb”.)
Now, let’s talk about you, “Mr. or Ms. SEBO”. You are in control of your own destiny. You wake up every morning in search of growing your business and your marketplace. You also go to bed every night worried to death about the risk that you are taking by doing so. The increases in your value come from growth. Therefore you are a STOCK. You are 100% at risk, and your value can go to zero. So to diversify, you must invest into bonds, or bond equivalents. If you’ve been wondering why you are emotionally battling with your advisor about putting more money into stock mutual funds, there’s your answer. By doing so, you are naturally over-diversifying…also known as redundancy. He is telling you that you should take assets from your SEBO, of which you understand the risk and volatility, and put them into another risk pool that you do not. By following his advice, possibly funding a SEP or other retirement plan, you are also reducing or perhaps eliminating the current opportunities of USE, ENJOYMENT, & CONTROL of those assets…and again, there has been no return for the last 11 years!
Enter THE BANK CALLED YOU. It’s a way of diversifying YOU. By utilizing a different type of bond portfolio, automatic diversification is created against the risks that you take every day. It’s an investment that never goes down, can only go up, and has no correlation to the volatility of the markets…both stock and bond. It creates a synergistic relationship with the SEBO in you, and enhances USE, ENJOYMENT, & CONTROL, of your assets. It takes risk off the table, while creating diversification and tax efficiency of those hard earned assets. It also builds a bigger moat of protection around your castle of financial and professional assets.
To learn more about it, please go to my website & watch the videos. You will probably want to learn more, so click my e-mail address and contact me. I’ll introduce you to the concept and show you all of the strengths and weaknesses of this strategy. No sales pitches, I promise! If you are a SEBO, or know someone that is…it’s time you take me up on that Starbucks latte.
Regards,
Brian Carden
Brian_Carden@PeachtreePlanning.com
www.briancarden.com
01/11/2011
What Would You Do?
This post is not about your “bucket list”. I wrote on that a long time ago after the movie came out. This is hardcore stuff about real world conversations that I have had with people just like you. I’ve looked into the eyes of a husband and father that was just deemed terminal by cancer and told him what the financial options were for his loved ones if he dies…and if he should miraculously live. I’ve squeezed a man on the shoulder because he was unable to shake my hand because of an accident that rendered him totally and permanently disabled…and said he didn’t need disability insurance when I mentioned it to him years before. I’ve met egocentric men, thinking that they knew everything but were humbled by the fact that their career path was at its end due to corporate “off-shoring” of their job, their big title, and their six figure income. I’ve sat with people that bet their entire life savings on a high flying stock pick from a friend and lost it all. So…what would you do…?
…if you knew you were going to die in 6 months?
...if you knew you would be totally disabled in the next 12 months?
...if you knew you were going to become a financial failure in the next 18 months?
…if you knew that the “roaring bull markets” of 1981-2000 are gone for good?
What would you do? It’s 2011! Would you do what you’ve done to date, which is say that “I don’t need that much life insurance” (even though it’s available to you right now)…or say “Disability insurance is too expensive, besides, I can always work if I’m hurt.” Or perhaps, you’ve told your wife that “I will always be marketable in the workforce…don’t worry”. Oh yeah, I can’t leave out my “red flags” on the financial entertainers as they’ve totally duped Americans into thinking that they will be comfortable in retirement by following their continually recommended philosophies that they cannot validate…and they do it on a daily basis. Where is it written that Americans deserve a double digit return in their 401(k) plan and a guaranteed employer match on top of that?
So…what would you do if faced with one…if not all of the above listed questions? Are you still going to ignore it? It will get better, won’t it? That won’t happen to you, will it? You’ve got it all under control, right? If you’re reading this…forward it to your spouse or significant other and let them answer these questions for you. Trust me the answers you get won’t be the ones you’re thinking of.
Are there more efficient strategies? Absolutely. But the key is prudent planning before “bad things happen to good people”. I’m not talking about products here…but serious, roll-up-your-sleeve-planning using “worse case scenarios” and cost recovery strategies where dollars leaving their lives could have been “recaptured & redeployed”. Could I have helped that man buy the appropriate amount of life insurance before he got sick so that his wife would be somewhat relieved? Yes…actually, his “human life value” or to put it in terms of your homeowners insurance, his “replacement value” was $10,000,000. The friend with the total disability couldn’t make it on 100% of his salary, so how is his family going to get by on 0%? That egocentric man could be in great shape from a “use, enjoyment, and control” perspective had they followed some simple advice and reallocated monies into more effective investment and savings buckets. And if you’re thinking that this market will recover anytime soon, and that as the financial entertainers keep preaching, you will “retire in a lower tax bracket”…well…”A fool and his money are soon parted!”
I must admit, I cried when I got home after meeting the man with terminal cancer…it broke my heart that I couldn’t improve their financial situation…but I hope I did help them emotionally. My job that evening was to evaluate where they were from a “YOU ARE HERE” perspective…and to give hope to the wife that at the least, she could sleep a little better that night. The best words I could have ever said came out that night…and that was “Given where you think you are, I think you’re going to be okay”. I trust she might have gotten a good night’s sleep that night…and that’s why I do what I do. By the way, they didn’t have updated wills! That’s done now too…a little detail they had overlooked.
This one came from the heart…It’s not full of metaphors and word pictures, of which I seemingly have gotten a reputation for among my friends, clients, and tongue-in-cheek critics. Everything above is real…I can’t make it up…I carry these memories around with me. I’ve said it all along; I CAN HELP YOU IF YOU WILL LET ME!!!! Maybe now it’s time…it’s up to you…
Have a Great 2011!
Brian Carden
Brian_Carden@PeachtreePlanning.com
www.briancarden.com
12/14/2010
Trusting in the Holidays
It’s always interesting as to how I write this holiday post each year. Sometimes the words flow like butter…sometimes like barbed wire. For the majority of my year’s writings, I can look back and see a lot of logic through the paragraphs and factoids that I’ve gotten on the pages. Occasionally, I’ll have an emotional piece like last month, when I wrote about Dad. It’s easy to write about him…and if you know me at all, you know why. Right now, I’m probably more emotional than logical…it’s been that kind of year.
In reflecting back on 2010, it’s been a good year for the most part. There are new friends and clients in my life that were not here 12 months ago. Also, as a firm, we are blessed to have helped a lot of people that have come through our planning processes here at Peachtree. When I say “I can help you if you will let me!!” I’m speaking for everyone here and I’m saying it passionately. We believe in what we do. In preparing to talk to an investment club later this month, I saw a chart on one of my regular reads showing the connection between “Wall Street and Main Street” were at polar opposites…meaning the trust of our industry has pretty much gone out the window in relation to the past performance of the markets. I can’t really blame people for feeling that way either. I’ve seen marketing pieces from investment companies that have to go back a full 15 years just to show a positive average annual return in their funds. This sleeping bear market of 11 years and counting is snoozing along with no end in sight. The investment firms that I turn to for my information say we might be on the back side of this bear market…which still means it could be another 6-8 years of zero percent average returns.
The industry seems to think that if you advertise enough on Sunday sporting events and show enough happy couples living the dream of a comfortable retirement, that it will convince you that they are trustworthy. You trust that right? Trust is something that is earned, not given. It’s also something I know I can’t advertise.
Several years ago, I wrote a piece entitled “Memories of the Sears Wish Book”. One of my favorites as back in the day before “big box stores”, the Internet, and of immediate gratification, this wonderful publication was as good as it got! After hours of reading, studying, writing in, marking up, and dog-earing pages of that amazing catalog, my brother David and I got to go see Santa. The amazing thing was that both David & I trusted him! Call it naïveté. Call it what you want…but we trusted Santa Claus. The anticipation of sitting on Santa’s lap (at the Sears on Central Ave in Knoxville) and telling the big guy what we wanted for Christmas…well was pretty darn awesome for two kids in the 1960’s.
The proof was in Christmas morning…over those years of trusting, Santa brought a new bike, figure eight slot car racing set, Lincoln Logs, LEGOs, numerous Hot Wheels & Matchbox cars, and the crème de la crème…the football game with the vibrating field and the decals for all of the NFL teams! (Ladies, I’m sorry…I didn’t have a sister, so I can’t relate to Barbie dolls and the Kenner EZ-Bake Oven.) Amazingly, we somehow got what we wanted…we didn’t get it all, mind you. But we always got the top 1-2 items on the list. We didn’t know he wasn’t really real…until we saw price tags on a box one year…but regardless, we had faith and trust in Santa.
This Christmas I have a lot to be grateful for, as my family circle is still intact…in fact there is a new addition, as I have a new dog, Charley…a two year old rescued west highland terrier…and he will experience his first Carden Christmas. For the most part, my own personal joy of Christmas is based on our family circle. Mom & Dad are continuing to do well…my brother David, his wife Cindie, daughter Courtney, and their son Chase (my “mini me”) will all be together once again. As long as our “circle remains unbroken”…all will continue to be okay. I have the faith and trust that it will continue to be.
In keeping with my initial thoughts…now is that time of year that I specifically get to share with you that I am grateful for the trust that you have shared with me…from being your “trusted advisor” to being a trusted friend. Perhaps we have never met, but you are a loyal reader. If that is the case, maybe 2011 will be the year that you really start to question how you feel about trust, and maybe we might be able finally have that long promised latte’ together to learn why you feel that way.
It’s my hope that you have a blessed Christmas and Hanukkah season…that it be covered in love, peace, friends, family, and of course the trust that maybe…just maybe…if only in your memories…there really is a Santa Claus.
Peace,
Brian Carden
Brian_Carden@PeachtreePlanning.com
www.briancarden.com
12/02/2010
Sailing and Rowing
If you’ve looked at your investment statements lately, you might notice that there are no parentheses around your annual returns. Yes, these double digit returns, are a pleasant change from the last couple of years, but the big question is how long this will last. Given the current economic conditions, what are you doing right now to prepare for what lies ahead?
This year, we have been fortunate to get reasonable returns in our equity investments without doing a lot except stay the course. This is called a “sailing” strategy. The winds are at our back. But what did you do when faced with a headwind? Did you finally give up, surrender, and disinvest into cash or money markets? …or did you look for alternative strategies that made good investment sense? To prove my point, the average annual return of the S & P 500 since 2000 is a NEGATIVE 4% (source PPCA, Inc.)
Given this statistic, if you think about how to move forward when the wind is in front of you, this is called a “rowing” strategy. What can I do to keep moving forward when the markets are making it difficult for me to get any return at all? Granted, last year, all bets were off as all asset classes were down. US stocks, US bonds, and International were all in negative figures…and even the safety of money markets was in question for the first time in my professional career.
If you are insecure about your financial future, don’t feel alone. The person in the car beside you, or the office next to you is feeling the same. No one feels secure these days. Unemployment is affecting the middle to high income earners and not just the laborers and “blue collar” people. The common thought in our office is that taxes have to go up to support all of the government bailouts, subsidies, and support programs.
You’ve probably heard that the US dollar is becoming less and less valuable in the global economies. To prove this point, after I got back from a much needed vacation to Cancun a few weeks ago, I got my bank statement. All of my debit charges had an additional currency exchange fee as the dollar decreased in value to the peso in that brief couple of weeks. Quite eye-opening actually!
What’s the point to all of this? You are probably hearing about a lot of “tactics” to make money in this volatile economy. Tactics might work in the short run, but it is prudent “strategies” that will help guide you through all of this market volatility, not to mention the inclusion of other economic drags, such as inflation, taxes, the cost of living, and life events. Anyone can create “sailing” strategies. However, what makes a “rowing” strategy work is the “coxswain”…the person at the front of the rowboat coaching and giving direction to the crew. In the financial world, the coxswain should be your trusted specialist. He is the one that you need to trust to guide you through those headwinds.
Given what lies ahead, “all things financial” is not a “do it yourself project”. If you are somewhere between “shoulda, woulda, coulda” and “fixin to get ready to”…let’s talk. There’s never been a better time to have that cup of coffee.
Best wishes,
Brian Carden
Brian_Carden@PeachtreePlanning.com
www.briancarden.com
11/09/2010
Walking Down Gene Carden's Road
Inspirations come to me from a myriad of places…sometimes, I’ll hear a song lyric…or perhaps see a quote that resonates…and often times, it’s from the vantage point of a pew on Sunday mornings. Recently I heard Mike Glenn state that “Common sense isn’t all that common.” Needless to say, I grabbed one of my 3 x 5 cards and started writing. I’ve said it before with total conviction and I’ll continue to say that our Senior Partner Corky Dawes, who is a true friend and mentor to me, says that I have the third most important occupation in your life, behind your physician and your pastor. By the way, Mike is the pastor at Brentwood Baptist Church…you know, the one on Concord Road at I-65 that looks like a small community college with a steeple.
One of the things I most enjoy about Mike is that first of all, when I’m in the room with several thousand other people, it always feels like he’s having a conversation with me…and only me. There is not a pulpit, podium, nor a teleprompter anywhere…he’s just speaking from his heart. If you’re a member there, perhaps you feel the same as I. His last series was comparing where one pledges their allegiance: to the American dream of success, stuff, and the like…or the spiritual world of living a Godly life and using the Word as a roadmap. He quoted Thomas Jefferson who wrote the Declaration of Independence, and more specifically he talked about where Jefferson wrote about the “pursuit of happiness” and not “the possession of it”. We do like to own stuff here in Williamson County, don’t we?
It’s funny, because we all can laugh at all of the televangelists that we’ve seen through our years of watching TV. I used to do a great Ernest Angley impersonation when I was a kid. Remember that guy? He was hilarious…but then again, I saw him for who he was. There were only three channels back in those days, so on rainy days, when we couldn’t go outside to play, we watched stuff like this. “Say ba-by…out demon spirit…come out!” I didn’t realize that one could create so many syllables out of a name like Jesus…“Jae-eee-eee-sss-us”.
Why do I mention this? Simple…for every religious nut out there, there are men of God like Mike Glenn who can stand in front of everyone he meets and speak from his heart. He basically calls it as he sees it, and he calls it with conviction. He has a lifetime of experiences, studies, and life lessons that he can pull from on an immediate basis. When Mike talks, I listen…intently…I’m always listening for that “ah-ha moment”...that moment when I hear something that resonates with me that I can bring back to my desk and write about with financial overtones and my own set of experiences, studies, and life lessons…just as I’m writing to you right now.
You might think that I have the audacity to play the religion card and to compare myself to Mike. If that is the way you feel, then please stop reading, close this screen, and move on. There is no sense in reading any farther if that thought has entered your mind. One of my favorite sayings is “The Lord Wants spiritual fruit, not religious nuts.” Needless to say, I can’t stand religious nuts, and here in Nashville, the buckle of the Bible belt, we have more than our share of them…especially in my business. Unfortunately, in the last 2-3 years, there has been a lot of harm caused by financial advisors professing their faith as a marketing ploy to get people to invest their hard earned dollars with them. Unfortunately for the investor, those unethical schemes cost the clients millions of dollars and put the advisors in prison…and the sentences can’t be long enough to suit me!
Mike is a battery recharger for me. I show up on Sunday sometimes drained by my prospects, friends, and even clients. The media makes everyone think that being a financial advisor is an easy job where all you have to do is just talk to people, get them to sign a few forms, get paid very well, and then spend the rest of your time at the country club schmoozing more people to sign a few forms. Trust me…there’s a reason that my industry has a 95% failure rate of new hires in their first 12 months of employment…it ain’t that easy! Mike helps me be made up of the best “spiritual fruit” I can be.
Where I do see myself like him is in my conviction to share the truth with you on matters that I see myself as knowledgeable on my areas of expertise as Mike considers himself. And I have the passion to stand up for what I know is truthful and in the best interests of everyone I meet. Just as there are “religious nuts” in Mike’s world, there are “financial gurus” in mine. Those that seemingly have some credibility because they are behind a microphone of in front of a camera, but can do more harm with their words than any televangelist can ever do.
So, 28 years later…here I am…after having numerous conversations with God as to why this industry chose me. At first it was a job…then it became an occupation…then later a career…and now after some answers to a lot of my questions, a true calling to help people, I find myself listening to a man like Mike Glenn asking me “Brian, on what road have you built your life?” I’m looking at my 3 x 5 card right now with those words written on it. I will tell you for all of the glass half empty days; there have been an abundance of glass half full days. A majority of those glass half full days involve my Dad…either in conversation or in thought. If you’ve been a loyal reader of my posts for the last six years, then you know of Dad.
He’s 85 now…a little slower these days, but he’s still with us. The “Carden foursome” played a few weeks ago…Dad, my brother David, nephew Chase and of course, me. He can’t hit it very far these days, and it frustrates him, but he still hits it straight as an arrow…and to him, being out with us is about as good of a day as he can have...short of being with Mom of course. About three years ago, life happened, and God pretty much told him, “Gene, you’re done working…but I’ll make sure you’re around for a while longer.” At one point, when he was completely out of it in his hospital bed, and we were wondering if his time with us was over, he suddenly woke up, looked at Mom and said, “Hagan, I’m not done yet!” I swear, his last words to us will be “Don’t worry about me, I’m fine.” And I have no plans to hear those words for quite a while!
Dad would love nothing better than to get up in the morning and go out and make “sales calls” as he calls them. He just loved being in the mix. He told me recently that he never worked a day in his life. He just got up every morning and did all he could to help people. He sold industrial tools, mill and mine equipment, and just about everything a manufacturing plant or construction company could use. If you signed a purchase order within a 100 mile radius of Knoxville, chances are Gene Carden’s card was on your desk somewhere. Recently some of his friends from a company he used to call on looked him up in the phone book and called the house. Mom answered and they asked if this was Gene Carden’s house and she said yes. Then they asked “Is he still alive?” To which Mom answered, “Yes he is, would you like to talk to him?” Needless to say, Dad went down and had lunch with them a few days later. It made him feel so good to know he was missed and that he made a difference to those people. There is no telling how many people he has touched through these many years of “doing what Dad does”.
It’s funny. I’ve never seen him read a Bible or quote scripture…never seen him pray other than saying the blessing at the dinner table…never seen him do a lot of things that you would think a lot of “religious men” might do. The closest he probably came was telling me his version of the Golden Rule, which was “To have a friend, you’ve got to be a friend.” Then again, I have never met a man who “walks the walk” any more than Dad. I’ve learned through him that it’s my walk that makes me who I am…not my talk. It’s the consistency of getting up every morning, and doing your best to help someone else. Not the money you make, the notoriety you get…just get up every morning and do all you can do to help someone else. Dad doesn’t feel the need to tell me about his walk with God…he’s just shown it to me for all of my 52 years.
He has to walk in the evenings to keep up his strength, and when he does, he will call me a couple of times a week and we will talk about my day…who I saw, what I did, the frustrations I have in getting people to understand I’m truly trying to help them, etc. The greatest compliment I’ve ever received came from a man who knew Dad for years and he told me “Darn it Carden, you’re just like your old man!” To which I replied, “Yes I am!” So when a man like Mike Glenn asks me on what road have I built my life, it’s easy for me to look at the road that Dad continues to walk.
In my walk, I do everything I can to be like Dad…and to be quite honest, some days it’s just hard…sometimes downright frustrating. Where Mike Glenn can stand up on Sundays and tell you what you’re doing right now is not going to get you to where you want to be from a Godly perspective, I know in my heart, and with 28 years behind me, I can tell you what might have gotten you here will not get you there from a financial perspective. Or in some circumstances, I can tell you where you would have been if you hadn’t listened to one of those financial entertainers that you think are “all seeing, all knowing”. They call them “financial gurus” now don’t they? Whatever…regardless, whatever you think. I can not only state with all of my heart and soul, but also numerically validate, that a high percentage of what you hear and read is wrong regarding investments, insurance, and many other things financial. You can’t get financial advice through the media, just like you can’t get a haircut over the phone!!
I’ve sat and listened to potential clients rationalize their misguided beliefs to me over and over again. I’ve had friends who thought that since they made more money than I did, that they were smarter than I, and that they knew exactly what I did for a living. To which I replied, “You have no clue what I did, because if you did, you would realize immediately that I could help you!” But I guess that guy at the brokerage firm was still promising him 12% returns like the financial entertainers are promising you every time you turn on the radio or television. I’ve had men look at their wives and tell them point blank that “They weren’t buying that much life insurance on themselves.” To which I thought, obviously, you love the money it takes to buy the insurance more than you love your family. And on a daily basis, I find myself quoting the comedian Ron White, who gave us “You can’t fix stupid!!”
Wow…this piece didn’t wind up finishing the way it started, did it? But as Popeye says “I am who I am!” In my case, I don’t apologize for it. I know the quality of work we do here at Peachtree Planning of Tennessee. I know the difference between an investment strategy and a mutual fund or variable annuity sale. I know a product peddler when I see one. I know a faux leather binder full of facts figures and assumptions doesn’t make a financial plan. I know when someone has been taken advantage of by someone claiming to be a “fee based” this or “certified” that, and if someone plays the “Christian” card, it has always been my nature to run like my hair was on fire…regardless of what industry they were in!
And, I know who I am…and what road I’m on. Thank you Mike for your words of inspiration…and of course, thank you Dad…I love you and am proud to be your son. See you around the family table in a few weeks.
Have a wonderful Thanksgiving!
Brian Carden
Brian_Carden@PeachtreePlanning.com
www.briancarden.com
10/11/2010
Deus Ex Machina
OCTOBER 2010 INSIGHTS
...from the desk of Brian Carden, Financial Advisor
Oh would my 8th grade Latin teacher, Miss Ahler be proud. 40 years later, I'm speaking her language. The English translation of this phrase is "God from the machine". Where it's applicable is usually in literature. It is a device used in the plot whereby a seemingly impossible problem is suddenly and abruptly solved with the immediately created and unexpected intervention of some new character, ability, or object.
If you enjoy a good novel as much as I do, you dive deep into hundreds of pages waiting for the big twist in the plot that either solves the mystery, or brings all of those different subplots together for the big finish. You're entrenched in this story, and then all of a sudden, something, or someone appears from nowhere and amazingly, the dilemma of the created plot is solved. It makes for a wonderful read if you're strictly talking about literary fiction.
However, in the world of "financial fiction" it's a different scenario. Let's think about this for a moment. Our parents and grandparents world of guaranteed monthly pension incomes is close to extinction. The thought of receiving Social Security benefits in the future is not as guaranteed as it once was. If you stayed fully invested in stocks and stock mutual funds for the last decade you lost money (average annual return = -.2%). To top this, the "financial entertainers" are still spouting double digit returns and a retirement where you won't out live your money. I don't get it how does that work? One was on an Internet video proclaiming a future value number in retirement where the calculated average annual return (that they didn't have to disclose) was close to 19% and I can't make this up another was on the front of a cereal box in the grocery store offering the chance to win their financial plan if you bought that brand!!
So the guaranteed pension income provided by corporate America is going the way of the albatross the future of Social Security is in jeopardy, in spite of trusting your advisor's constant words of "hang it there, your account will recover", you're still not making any noticeable progress in your equity accounts, our country's global strength is diminishing daily, and I can go on and on. So I ask you: Where is your "Deus ex Machina"?
In your "financial plot", what amazing intervention do you expect to happen that will solve your current and future financial life? It's not hidden in rates of return or a "one size fits all" financial plan and it is surely not on the radio, television, or newspapers and no the Lottery doesn't count either. If you can't think of anything even remotely realistic, maybe it's finally time to take me up on that free Starbucks latte.
Best,
Brian
brian_carden@peachtreeplanning.com
PS: Thanks to Vince D'Adonna with Strategies for Wealth in New York City for initial thoughts on this idea.
09/09/2010
My View On The World
SEPTEMBER 2010 INSIGHTS
…from the desk of Brian Carden, Financial Advisor
Satchel Paige is quite an athlete and a great story in the annals of professional baseball. He was pitching in the major leagues well into his 50s. And like Yogi Berra and Casey Stengel, he was very quotable. Of my favorites is “It’s not what you know that hurts you. It’s what you know that just ain’t so!” Given this as a mantra, I have a huge bias against most of what YOU are exposed to regarding money, investments, and all things financial. It is continually amazing to me how the media continues to confuse virtually everyone. Let’s list them shall we?
- Jim Kramer ranting on CNBC about how picking US stocks is the way to financial success.
- Everyone else on that station reporting every single bit of minutia that might make a difference to one’s portfolio…and generally doesn’t make a bit of difference…but sells a lot of ads!
- Sam Waterston telling you that you can have financial freedom by doing it yourself with TD Ameritrade.
- Wall Street based wire houses telling you that they know how to invest, when to invest, and that you should trust them because they are who they are…period. (Can you say credit default swaps...I know you can?)
- Financial entertainers spouting their own brand of disoriented and invalid information to the masses that seem to think they are credible because they have a camera or microphone.
Now, the second part of this…after 28 years of “reading between the lines” I continually shake my head at what the mutual fund industry puts out there for advisors to use to convince YOU to invest your money with them. Let’s look at a few of these:
It’s an industry statistic that almost 70% of all advisor based mutual funds are placed with one particular fund family. This one has a bias toward investing in large US based companies and one that sells its funds based on historical performance and lower than average management fees…but has to put in every brochure or publication for you to read “Past returns aren’t predictive of future results.” Its insane how many people come into our office thinking they are well diversified and all they own are 4-5 funds entirely in this investment firm. This one piece they published for the advisor community went as far to say that this wasn’t a “lost decade”. This because their flagship funds actually had a positive average annual return for the decade ending December 31, 2009. The comparison point was showing that the S & P 500 Index had a negative 1% return. This wasn’t a “lost decade”? Okay, let’s see…I bought this fund and held it through all of the cyclical bears of the last decade and all I have to show for it is 2-3%? Right…still felt lost to me!
In the period from 1982-1999, if you threw money at the market, the prevailing winds blew it to an average annual return of 16.8%. It was easy. Open your sails wide just put money in an account and watch it go. I actually lost a client because his portfolio only returned 30% in one year and he read in Money Magazine that he could have gotten more if I had invested him in specific fund. Obviously, he didn’t see that I didn’t have a crystal ball in my office, nor do I have one now. This was the biggest run up in our country’s history…from start to finish a total return of 1409% (Source Ned Davis Research). Almost 40% greater than the last bull market that lasted from 1942-1966…but who invested in the market in those days? My Dad and Granddad both had pensions provided by their employer back then, so who needed to invest their own money for retirement?
What caused that huge run up? Let’s look and see. If you’re going to look at historical performance, you need to look at what caused it. Ronald Reagan and “Reaganomics” cut income tax brackets to the lowest they had been since Roosevelt took office. Here’s a trivia question for you. What was the highest marginal tax bracket in our country’s history? 94% during the tail end of WWII. Roosevelt may have turned our country around with the New Deal and other programs, but he taxed the country to death to do so!
In 1982, in addition to the Reagan tax cuts, 100% of the baby boomers were fully employed which meant that the largest demographic group in the history of the country were earning wages and paying taxes. Unemployment was at an all time low. In addition to this, in 1980, the Individual Retirement Account and the 401(k) plan were introduced to Americans….and also at that time, the mutual fund became a very popular investment tool for those accounts as they created automatic diversification and lower entry costs into equity investments in lieu of individual stocks. So here comes a huge influx of new dollars into the market invested directly into those US companies. Demand drives up price, so off we go…the bulls are running hard!! Oh yeah, back then, we still made stuff! We proudly said “Buy American” and we did it. It was later in the 90’s that the US stock market growth began to skew corporations to look more toward shareholder returns and overrode employee loyalty. Back in that time, the rule on investing internationally was “never invest in a country whose food you would not eat”. China and India were still third world countries…not the global economic engines that they are today.
Enter the dot com era of the late 90’s. Computers had replaced thousands of workers. Exporting the manufacture of consumer goods to the Far East and other countries that provided cheap labor replaced thousands more. Initial Public Offerings (IPO) of technology driven companies were happening hourly and even though many never had a dollar of earnings, public demand for them drove their prices through the stratosphere. Even a chat room went public…how does that happen? Well, easy dot com…easy dot go…
Alan Greenspan, who was the head of the Federal Reserve…the overseer of US monetary policy…said very clearly “The market is showing signs of irrational exuberance”…meaning it’s still going up and I don’t know why!!! So in March 2000, after we survived the millennium scare at New Years, BOOM…We enter the start of our current bear market in March 2000. Tech companies tank…corporate spinoffs with no sustainable growth model goes down with them…bubble burst big time!
The running joke around Nashville was that if you compared buying $1000 of Northern Telecom stock to buying $1000 of Anheuser-Busch…the beer, not the stock…drank the beer and recycled the cans…the profit of the recycled cans would have been worth more than the NORTEL stock. Moral of the story…don’t invest…drink responsibly and recycle. (As Larry the Cable Guy says, “That’s funny right there, I don’t care who you are!)
Enter 2010. President Obama has passed what looks like the first of several new laws that sound a lot like socialized healthcare. Income taxes are going up in 2011. The first of what people think will be several going forward. George Steinbrenner, the owner of the New York Yankees, died recently with a $1.1 billion estate (that’s $1,100,000,000.00) and paid ZERO in Federal Estate taxes because the government couldn’t make up their mind about what to do with estate tax laws because they were so wrapped up in healthcare. Almost all of my investment managers that I look to regularly for true unbiased advice are negative about the next 3-6 months. Some are surprisingly neutral, and only one is optimistic, but they are a globally biased money manager and they still see opportunities on the planet.
For the last 10 years, for “staying the course” for doing what you didn’t do the last time the market tanked and you might have actually stayed the course and didn’t disinvest into cash…for all of those sleepless nights, you were rewarded with a negative return of .2%. 2008 was a reality check for everyone as we had seen 10-20% volatility in the markets…but 40-50%? That’s a hard pill to swallow. So what have investors done since then? Well, if stocks don’t work, then bonds must right? So we’ve seen a huge shift of new dollars into bond funds…80% of all new dollars going into bond funds to be exact in 2009 and year to date 2010.
So, let’s see…instead of risking dollars in stock funds, people flock to the false sense of safety in bond funds. Per Peter Lynch, the creator of the Fidelity Magellan fund, bond funds can be more volatile than stock funds because they don’t have the upside potential of stocks. For a true stock fund manager, bond funds are designed to do one primary thing: reduce the overall volatility of the portfolio…period. They serve no purpose other than that to an equity minded investment manager.
Bonds, however, do have the downside issues with interest rate risk. With interest rates at historical lows, and with US government debt at an historical high, if the government increases bond yields to meet the demand of those that buy our debt…namely BRIC countries (Brazil, Russia, India, China)…if they increase the interest rates on newly issued bonds to entice the purchasing of US debt, then existing bond funds with lower yields will decline drastically. Guess what…another bubble yet to burst! So…how are you feeling so far?
So let’s talk about my new favorite investment metaphor “SAILING & ROWING”. Here’s the simple truth. If we are back in the years of 1982-1999, the winds of fortune were blowing. The bull market was running. If you were fully invested then, you were using a “SAILING” strategy of investing. The winds blow…you’ve got a full sail, and your account goes up…simple. Just like the phrase “a rising tide floats all boats”…a strong wind blows all sails. Regardless of asset class, large vs small, growth vs value, domestic vs international…it didn’t matter…the prevailing winds blew your stock mutual funds went up.
How about the last decade from 2000-2010? Those winds weren’t blowing…in some years like 2008, the unforeseen headwinds blew you backwards 40-50%. Sure, you might have had a year like 2007 where you caught some breeze, but it was fleeting. All the momentum you thought you had going into 2008 quickly dissipated. If you are participating in a company retirement plan, 401(k) or 403(b), IRA, or a 529 college savings plan…you are in a sailing strategy...PERIOD. Even if you are in a bond fund, given the current climate, you are in a sailing strategy. Your only alternative to this is disinvesting into cash…and logically you know this is not a viable strategy…but trillions of dollars are disinvested there right now.
One of the problems with SAILING strategies begins with the way that their fund managers are compensated. If I am managing a large cap US stock fund, my performance is measured against my benchmark, which is normally the S & P 500 index. So if I can outperform my benchmark, then my picture will be on the cover of Money, Kiplinger’s, and Fortune magazines, and we will then have a huge inflow of new dollars chasing those returns…oh, I’ll get a big bonus for taking more risk with your money…but then again, you gave it to my fund to reduce your volatility and diversify your portfolio, didn’t you? How does that statement make you feel?
Enter “ROWING” strategies. Those money managers I mentioned earlier that I rely on for viable non-sensationalistic and logical information understand this. They tell me that we might be on the backside of this Bear market…that’s encouraging…but it still means that we could be in it for another 8-10 years as from their vantage point; they do not see any positive economic indicators that tell them otherwise.
What are ROWING strategies? What do you do when you have to move your money forward regardless of market conditions? If there are no winds of fortune for you, you have to have oars in the water. I call this an “Absolute Return” strategy. Bonds won’t do this. Cash and Money Markets will not do this either…they may not lose money, but in this economic climate of all time lows, bank savings accounts, CD’s, and money markets aren’t even coming close to even equaling inflation…which at present, is lower than its historical average of 3%.
A great example of an Absolute Return strategy that is very accessible to you is the cash value account inside an ordinary dividend paying whole life insurance plan. The dividends are subject to change on an annual basis, but the minimum guarantee on the cash in the contract is 4% and it’s also guaranteed to never go down. There you have it…a perfect example of something of which you’re probably very desirous…but you wouldn’t want that would you? Those financial entertainers who are always 100% correct think that is a horrible place to put money!
Where are ROWING strategies needed; where money is on the sideline for a future use, such as operating capital for a business owner, for college planning where the student is less than 5-7 years away, for diversification against a Bear market with no end in sight, for people who are either close to retirement or who are in retirement who need their assets to keep up with and possibly exceed the cost of living for seniors.
It sounds fairly simple, doesn’t it? However it’s not. ROWING strategies require considerable skill and work in search of value. Unlike SAILING strategy managers, ROWING strategy managers manage to a different benchmark. They manage to a “zero loss objective”. Simply put, they “win by not losing”. If they don’t lose money, then they are more likely to earn their bonus. You might think you are doing this yourself by not being invested at all…choosing to keep your assets in money markets and cash. Well, these managers are “winning by not losing”…you are “losing by not playing”.
So let’s recap. Stocks are not the place to be for the foreseeable future…long term, yes, as we will see another Bull market…short to intermediate term, probably not so good. The stability of the US economy has become a servant to the new global powers of China & India. Bonds aren’t much more attractive. Interest rates are at historical lows, and any increases will cause a huge drop in existing bond prices and account values. Money market and savings account yields are virtually non-existent. Income taxes have nowhere to go but up given government spending and a deficit increasing by the second.
Most of what you are exposed to in the media might not be in your best interests. Financial entertainers are just that…and most of their information is, and has been horribly wrong. SAILING strategies might sound good, but will not work in a secular Bear market. ROWING or Absolute Return strategies are available to you, but not through normal channels…not just any advisor or advisory firm can offer them.
However, it just so happens that I not only can offer them, but can tailor them to your specific economic desires. As I always leave each writing, I would love to learn more about you, your family, your wishes, dreams, wants, desires, values, and everything that you are saving your hard earned money for. If you wish to learn more about me and my practice here at Peachtree Planning of TN, please hit the contact button on this page, or call me directly at 615.506.0300. I’m betting that Starbucks latte that you won’t…but maybe it’s time to prove me wrong.
Regards,
Brian
Brian_Carden@PeachtreePlanning.com
Copyright, 2010, Brian E. Carden
08/16/2010
Recapture & Redeploy
AUGUST 2010 INSIGHTS
…from the desk of Brian Carden, Financial Advisor
Did you ever think that words that sound like military strategies could ever be circled back to discuss money, investments, and all things financial? I’ve said it before…I’ll continue to say it… "You really don’t know what I do!" Here’s what you might think I do, because it’s probably what the guy down the street probably does…(1) look at only the stuff that he can either replace or re-do (2) ask you how much more out of your lifestyle budget you can commit to buy more financial stuff (3) give you a sales pitch on a product that will outperform your current stuff ( 4) convince you to work with him because his firm is bigger, better and they are one of the country’s leading providers of…you guessed it…financial stuff.
What if you were able to look at your financial picture from a totally different perspective? The only time you create a Balance Sheet is when you want to make a major purchase, like a home or a car. We all have a Balance Sheet…however; the only thing we ever focus on is the Income Statement…which means we make $$$, we spend $$$, and hopefully we have a few $$$ left. So that’s where the guy down the street focuses his efforts…strictly from the cash flow that comes into your life.
What if I could “forensically” look at all of the intricacies of your financial world? I mean every moving part…from your car & home insurances, to your benefits at work, to your 401(k) and maybe even to your living expenses. What if by doing this, I could find dollars that are leaving your life unnecessarily…and you probably don’t even know about it? If I could do this, then I could have an insight to your “total financial picture”. Throughout the process, we will discuss why money is a part of the problem that “keeps you up at night”. We will have a values based conversation and find out what really makes you tick…and how those “psychological” thoughts, feelings, fears, wants, needs, and desires have played into your financial decisions. “Forensic Financial Psychologist”…I’ve said that before, haven’t I? (See April 2010.)
We could then discuss where the inefficient dollars are and discuss alternative strategies to make them more efficient. Inefficient dollars are those that are leaving your life unnecessarily…only never to return again...but the use, enjoyment, and control of those dollars are gone forever…and forever is a long long time. If we find those inefficient dollars and “recapture” them if you will…and we have agreed that your values about your money supersede your current tactics regarding your money, then we can create new strategies to “redeploy” those dollars.
What have we done? First, we’ve created a process for you that is living & breathing. Secondly, we can then use it to create financial strategies that will match your values. Thirdly, we can use it as an ongoing measuring stick to continually search for inefficiencies that we can “recapture & redeploy” throughout your life. Fourthly, and maybe the most important, we’ve created a strategy where “the efficiency of money can outperform the rate of return on money.”
How about that? If you have more money, you won’t need to chase returns on your money…come challenge me on that one…The Starbucks latte is waiting for you…and I’m buying…how’s that for efficiency?
Best,
Brian
Brian_Carden@PeachtreePlanning.com
www.briancarden.com
Copyright, 2010, Brian E. Carden
07/12/2010
Backstops
JULY 2010 ARTICLE POST
…from the desk of Brian Carden, Financial Advisor
If you ever played baseball or softball, then you know what a backstop is all about. It’s there to make sure things don’t get too far past you. You know when the pitcher throws a ball that is totally uncatchable…or when the left fielder sails a throw towards the plate and its 10 feet over the catcher’s head. When things get outside the lines of play…that’s what a backstop is for…in sports anyway.
If you look at your life, who can you count on to be your backstop? Yes, you can go to the spiritual side & say that God has your back…he has mine too. Really, when “life happens” as I’ve said a thousand times, who can you really say has your back? If you are as fortunate as my parents, who at 59 years together, make being in love easier than Phil Michelson makes a wedge shot, I know that through all of Dad’s health issues…that regardless of everything that he’s gone through…Mom has always had his back…and regardless of how his physical health has been, his heart & soul has always had Mom’s back…and it will until he takes his last breath…which I hope is a ways away…he just turned 85, and I’m not done with my Dad just yet...because he has always had my back.
Being a “SM-ISO”…single man in search of…not having someone I can call “my backstop” has always been that big hole in my life. What am I in search of, you ask? That one person I can truly count on to have my back…regardless of what life might throw at me…or at us. Shouldn’t be that hard, should it? If you are one of my good friends & clients reading this…you already know this about me…and I probably know that about you as well. This one, however, is up to God as I’ve thrown it back up to him on countless occasions.
From a financial perspective, who has your back? Who is that one person that truly has your best interests at heart with regards to your money, goals, wants, dreams, fears, and a plethora of other emotions? Don’t come back at me & say I have an advisor at “Blah Blah Blah Investment Co.” More than likely they are just a “hardware salesman” as I discussed last month. Don’t tell me you’ve got “a financial planner” because that financial plan they did six years ago was outdated the day they gave it to you…it was probably nothing but a snapshot of what was then. Don’t tell me you follow the guidance of one of the “financial entertainers” either. As I’ve said before, “You can’t get financial advice through the media…just like you can’t get a haircut over the phone.”
If you’re married, don’t tell me your spouse has it all under control. Trust me on this; we’ve yet to meet that spouse that had it “all under control” once we’ve done a thorough & comprehensive review of all of their moving parts. I’ve met too many widows that had that same thought…only to find out they were financially devastated because their late husband “had it under control”. I’ve met a bunch of business owners that felt the same…until their partner died…they thought it was “all under control”.
Here’s the deal…if you just write three small words at the top of a legal pad for me that say WHAT HAPPENS IF? Now start filling in the page with all of those things that come to mind…when you’re done, I’ll add another 40-50 for you, because it’s what I do all day long with my clients. What am I doing, by the way? I’m stepping up to the plate and becoming “your financial backstop”. If you let me do my job right, I’ll be more than that as well…as my clients have become my friends…and my friends have become my clients.
So I ask you? Who has your back? Take a good look behind you and see who is there…or who you think is there…or who just might be there that you’re unaware of. I’ll bet that Starbucks latte that you don’t have a financial backstop…so it sounds like you might just need me after all…and when “life happens”…if you let me do what I am trained and skilled to do…I’ll be right there. As our Senior Partner says often, we are the third most important person in one’s life behind their doctor and their minister…and not only do I believe that…I do what I can to live it as well.
Best,
Brian
Brian_Carden@PeachtreePlanning.com
www.briancarden.com
COPYRIGHT 2010, Brian E. Carden
06/14/2010
The Bank Called You
JUNE 2010 INSIGHT
…from the desk of Brian Carden, Financial Advisor
OK, it’s finally summer…locally the weather is warm, flood damage is slowly being repaired, and Nashville is slowly coming back to normal. In spite of all of the economic negativity being spouted on the daily airwaves, Internet, & alleged “financial gurus”, some Nashvillians are doing very well for themselves. In last month’s rant “Who Says” I challenged several of the financial myths that are continually being floated around by the above mentioned sources of information. This month, let’s look to measure some of the financial products where people are placing their money, circa 2010.
I’ll set the stage. You’ve probably heard that the 2000’s have been called “The Lost Decade”. From an equities based perspective, it’s true. But let’s look at a couple of other current issues.
- The Russell 3000, the broadest index of US based stocks, had an average annual return for the last 10 years of -.2%. All that risk for virtually zero return. (Ned Davis Research)
- Money markets and CD’s are at unattractive lows. Bank savings accounts are at 0.1%.
- 80% of all mutual fund inflows for 2009 and 2010 are going into bond funds. (Strategic Insight, 2010) First consumers are chasing returns…now they’re running from them!
- The US Government has issued bonds (or I.O.U’s) in excess of $42 trillion and most of them are being bought by our friends in the “BRIC countries “ (Brazil, Russia, India, & China). If they quit buying…we will have to incent them by raising interest rates to make them more appealing. If that happens, the resulting correction of the entire bond fund market could go crashing down just like equity funds did in 2008.
So just exactly where are you investing your dollars? It’s a conundrum, isn’t it? What if you could use a series of financial strategies and financial tools to create “The Bank Called You”? If you could do that, what would it look like? First of all, you would have to build the actual structure, and then put deposits into it systematically to make it grow. You would want it to have a reasonable rate of return, say 4%...and if it could be a guaranteed rate that would be even more attractive. Of course, there would be some annual expenses to running your bank as well.
Would you like to grow your deposits in a tax-favorable environment, and maybe even take dollars from your bank in the same way either through withdrawals or loans? This way you could create some effective exit strategies that many of your other investment alternatives might not have. To make it as safe as possible, you would need protection in place against creditors, predators, and life events such as illness, accident or death.
We’re just strategizing here…but if you’ve been a loyal reader for the last six years, you hopefully know two things. First, everything you read has been approved by a compliance officer for accuracy and correctness. Secondly, I’m not going to put anything in print I can’t back up. I’ve generally finished these pieces with a call to action…either in a response via e-mail, or to take me up on that Starbucks Latte that’s been available to you this entire time. “The Bank Called You”…has a nice ring to it, doesn’t it?
Sincerely,
Brian
Brian_Carden@PeachtreePlanning.com
www.briancarden.com
www.thebankcalledyou.com
05/10/2010
“Who Says?”
MAY 2010 INSIGHTS
…from the desk of Brian Carden, Financial Advisor
It’s amazing to me how people can believe the things that they do with no basis of fact other than their own opinions. With football season only a couple of months away, I am reminded of one of my favorite actions on an NFL football field. That’s when Jeff Fisher sees a bad call from one of the officials and throws the infamous red flag. In a kind and legal way, he’s calling “Bull Hockey” (with references to Col. Potter on MASH) on the official’s ruling. (I don’t think my compliance officer who reviews and approves all of my writings would allow me to say what I would like in this instance anyway…)
I carry a pocket full of imaginary “BH flags” with me on a regular basis. Usually they get thrown when I see Sam Waterston on a Sunday ad telling you how successful you can be by investing on your own with the firm that pays him well to read those cue cards…or when I see people walking around during the ad with a big number in their hands. If I was to waste my time by listening to the “financial entertainers” on the airwaves, this city would quickly be out of red fabric in a matter of days. I also throw them in my own office when reviewing the financial documents of potential planning clients. They thought they had a financial advisor, but in fact had some policies and a few statements that had no relevance to what was important to them.
One of my favorite quotes is from John F. Kennedy, when he said "The great enemy of the truth is very often not the lie--deliberate, contrived and dishonest--but the myth--persistent, persuasive and unrealistic." Financial myths are abundant…they can be so easily disguised behind a spokesperson, financial entertainer, or even more scary, a product peddler acting like an advisor.
So who says?
- You will retire in a lower tax bracket!
- You will get a double digit return in stock mutual funds over your lifetime!
- You will retire from your chosen career on your terms!
- You paying off your house early is a good financial decision!
- You buying term insurance your entire life is in the best interests of your loved ones!
- You maximum funding your 401(k) is the best financial decision you can make!
- You not having a properly drafted and executed will makes any sense whatsoever!
- The government will take care of you when you get sick and elderly!
Well, guess what? To everything above, I throw my plethora of “BH flags”…my myriad of symbols saying that everything that is above is a “financial myth”. The fundamental difference between me and all of the “financial entertainers” and other posers out there is that I CAN PROVE THAT THEY ARE WRONG!!!! Not only can I prove it, I can validate why these “financial myths” can absolutely destroy all of those values that we would have discovered together during our first meeting. Whew…I’m tired…enough ranting for this month…the Starbucks latte is on the table…waiting for you to hit the email button & take me up on my offer.
Best,
Brian
brian_carden@peachtreeplanning.com
04/12/2010
Hardware or Software
APRIL 2010 INSIGHTS
…from the desk of Brian Carden, Financial Advisor
No this is not about computers, so please keep reading. For what it’s worth, I refused to get a Blackberry up until 2 years ago, when our team forced me to have one…I’m not a technology guy in any shape form or fashion…trust me! I have 6 remotes at home because I refuse to consolidate to one!!! After 28 years in this industry and many of those years of wondering why my career chose me and not vice versa…I’ve been blessed to be able to turn my “career into a calling”. That means the man you meet in social settings is the same guy that will be across from the conference table in our office…or the one that is alongside you when “life happens” and other than a doctor, or a minister, I’m the other person you might need the most.
So many people that I meet are defined by what they do. However, what they do is not who they are. Herein lies my dilemma…as I’ve said before, “You really don’t know what I do.” In networking situations, to keep it very brief, I’ve often referred to myself as a “forensic financial psychologist”. Here’s how that breaks down:
- Forensic, meaning I dig up all of your policies, statements, wills & tax returns, etc. to review and figure out the all of the moving parts of your financial stuff.
- Financial means $$$$, pure and simple, because you probably have thought about your money several times this morning before reading this.
- Psychologist because it’s all about the emotions, values, fears, wants, needs, desires, hopes, etc…that surround your money. Granted, I am not a psychologist, but emotions come into every conversation I have with clients and prospective clients.
Why “Hardware or Software”? It’s very simple actually. Hardware is nothing but product sales. “Oh, I’ve got an insurance agent.” “My financial advisor manages my IRA, but I never talk to him…I’m probably too small of a fish for him anyway”. “I used to have an advisor, but he’s changed firms so many times, I’ve lost touch with him.” “I bought my life insurance on the Internet because it was cheap.” Trust me; I’ve heard all of these, and more! Hardware says since your account balance has gone down 40%, let’s move it to something safer…like another product!
Software, on the other hand, is all about being a trusted advisor…one that listens, asks a lot of questions that a lot of people are scared to ask you. It’s those questions that don’t get asked that keep you up at night, isn’t it? Software is all about learning about what is so important to you about your money…your family...your cash flow. Oh yeah, it’s also about the emotions surrounding the psychology factor that I mentioned above. It’s about planning…for today, tomorrow, and the next generation that follows you.
There’s a ridiculous misconception in financial planning, and that is “My financial advisor manages my money.” I don’t think so…that’s hardware. My role is not to manage your money, per se, but to manage you, your expectations, your emotions, and everything in between. How do I get paid? Well, just like a computer needs software to run…in order for your financial plan to be implemented correctly and managed as we go, the appropriate mix of products have to be in place first. I get paid to implement the products (hardware) so that I can walk alongside you as your trusted advisor (software).
So again here we are…the Starbucks latte is waiting for you. You tell me…what does your financial picture look like…full of hardware, perhaps? Let me know how that is working for you...
Best,
Brian
Brian_Carden@PeachtreePlanning.com
COPYRIGHT 2010, Brian E. Carden
03/05/2010
Exit Ramps
MARCH 2010 INSIGHT
...from the desk of Brian Carden, Financial Advisor
Listen to the Podcast and click the play button below.
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Read the Transcript
On January 29th, when Nashville was getting ready for its big snow storm, I was in Atlanta at our annual year-end celebration and awards banquet. We had all gathered for a firm picture, with over 100 staff members, advisers, and partners in attendance. As soon as the picture was over, our Senior Partner said very clearly, “Everyone from Nashville! Hit the road & let’s get home ASAP!”
Needless to say, it was a very, very long day. I drove & it took me 7.5 hours to get home, and the last 100 took probably 5 hours of that. We hit some serious snow on I-24…and an 18 car pileup to boot. My friend and associate Janet was my “co-pilot” and somewhere around Tullahoma she asked me if we could stop and take a break. So we decided to pick an exit, as we had choices. So we did, regrouped, filled up with gas, knocked the 50 pounds of ice off my car and headed home best we could. My “endgame” if you will, was to get to the most appropriate exit so that we could get back to our office here in Brentwood. That exit was Old Hickory Blvd. The key thought here is that I was able to create and implement my own “exit strategies”.
Regardless of what you might think…everything has an exit strategy. Your career, your retirement accounts, your business, and yes, even your life. Traditional financial planning seems to forget this as people are still being led to believe that they can retire on their terms…using a fictitious rate of return on their assets that we haven’t seen in over a decade. (12% according to the “financial entertainers”). Somewhere, somehow…someone convinced Americans that they should contribute the absolute maximums to their 401(k) plans because they would retire in a lower tax bracket. This one still dumbfounds me. I don’t know about you, but everything coming out of Washington these days says we’re going to get a lot of income tax increases over the remainder of our lives. Here’s a new concept for you: REVERSE TAX PLANNING. (Future article forthcoming)
If you are gainfully employed by a company, the owners have an exit strategy for you…they just haven’t told you yet. If you own your own business, or are an entrepreneur, you’re probably wondering how to “retire from your business”. From my experience with my business owner clients, owning a business is like going into the House of Mirrors at the fair. Remember that? It was easy to get in…fun to be in there for a while…but when you wanted out, you wanted out…and you wanted out NOW!
Stephen Covey said it best when he said “Begin with the end in mind.” Everyone knows this quote, but very few implement it. It’s easy to write a business plan and start a new business. It’s easy to fund a 401(k) or IRA. It used to be easy to get a job in corporate America…but just like the House of Mirrors, how are you getting out...on your terms!!! Traditional financial planning and the “financial entertainers” say that you’ll be fine and that the market, inflation, taxes, and life events will not be that big of an issue. However, I totally disagree. Our firm views your life in four distinct stages.
- Accumulation. You will always be on this line…making contributions and growing assets…probably for your entire life.
- Preservation. If you’re in your late 40s or older, you’re probably thinking, “I can’t be this aggressive anymore”. Especially with this 10 year Bear Market that has no end in sight. Where’s that 12% average return these days?
- Distribution. Which would you prefer; telling the market that you are going to retire on your terms…or having the market telling you that you will retire on their terms? Shouldn’t you start planning this now and not 3 months before you declare “I’m retiring”?
- Legacy. So you’re going to retire on your terms, in a lower tax bracket, still get a strong return on your assets, while taking monies out, and you will never run out of money while you are alive…leaving a legacy of love (and hopefully assets) to those that mean the most to you. Let me know how that works for you.
Last month I said that “You really don’t know what I do”…and I stand by that statement…with a Starbucks latte as a side bet. The bet still holds. If you’ve truly got it all figured out…show me. I’d love to see what your “exit ramps” look like.
Best,
Brian
Brian_Carden@PeachtreePlanning.com
Copyright 2010, Brian E. Carden
02/05/2010
You Really Don’t Know What I Do
FEBRUARY 2010 E-ARTICLE
…from the desk of Brian Carden, Financial Advisor
We’ve had this conversation around our office lately, and I’ve had it with several friends as well in social settings. The reason I say this is because the stereotypes of being a Financial Advisor are, in my mind, deserved in a lot of situations. However, in the case of me and my peers here at Peachtree Planning, those stereotypes are not even close to being accurate. I hear all the time “I know what you do”…“you just want to handle my IRA rollover” or “you just want to sell me insurance”. Wrong. Way wrong. What I do see most of the time is someone, maybe like you perhaps, that thinks they’ve got a financial advisor, but what they’ve actually got is statement full of investments and/or life insurance policies and that they are OK because of it. That isn’t planning…those are products.
We all know what the word “assume” spells…do you really want to assume you and your family will be able do the things that you want to do…or do you want to really know that you will? If you were one that bought a “financial plan” (and I use that term loosely) that was in a nice notebook, full of facts, figures, percentages, etc….that book is totally useless. It might have been a nice snapshot of where you were at the time, but today, all bets are off.
Anyone can go to the Internet and find all kind of calculators to project numbers. So are you still using the assumption that you’ll get a 10-12% average yield on mutual funds, that’s what the “financial entertainers” say, right? However I will state with absolute fact that the Russell 3000, the largest index in the US, has averaged a negative -.2% for the last decade? So for all that risk in equities…for all that volatility…for all that emotional frustration because your accounts weren’t growing…you got a -.2%. If I look back over the last 30 years, you would have gotten a 10.55% average annual return in equities…but then again, with an ultra-conservative portfolio of 80% bonds/20% stocks, I would have gotten 9.30% over the same time frame…classic tortoise and hare story. (Read this paragraph again…the risk hasn’t been worth the reward, has it?) Again…that isn’t planning…THAT’S MATH!!
So what do I do? First of all, I listen…and ask a lot of questions…about what is important about you, your family, your career, your future, your dreams, desires…and oh yeah, your money. I’ll bet you a Starbucks latte that even if you are making a good income, doing your best to meet those objectives, and maybe even you’ve got a financial advisor…that there are disconnects and inefficiencies in your life that that will keep you from reaching everything you told me in that first meeting.
Next, I analyze every moving financial part in your life…everything. Then we stress test what you’re doing, and show you where those disconnects truly are. Like a conductor directing a symphony, we find out what instruments are not in tune, and we make them so…without using an extra dollar that is already in your life. Maximum efficiency of your dollars and meeting your personal dreams, wants, and desires are our optimum goals for you.
Finally, we continue to build a relationship with you that helps us stay on track…call us a “Financial GPS” as we will always know where are in relation to our plan. When was the last time your advisor did a full comprehensive review on your total financial affairs? …and I mean a complete and absolute review?
That’s what I do…and I can help you…if you will let me…the bet for the Starbucks Latte is out there. Hit reply and let’s find out who wins.
Best,
Brian
Brian_Carden@PeachtreePlanning.com
www.briancarden.com
Copyright 2010, Brian E. Carden
01/11/2010
Use, Enjoyment & Control
JANUARY 2010 INSIGHTS
...from the desk of Brian Carden, Financial Advisor
The Use, Enjoyment, & Control Podcast:
Download Use, Enjoyment, & Control Podcast (right click save as)
Three simple words…but yet they mean so much…especially when applied to money, investments, insurance, and all things financial. It’s one of the reasons that US citizens are so deep in debt. If I buy a new car, HDTV, or any other consumer item, I can validate the purchase because I can have “use, enjoyment, and control” of whatever it is I just bought. Do I need to buy any of these things? In some situations, yes, but often times, not. How much stuff does one person need anyway? Did you know that “retail therapy” is actually a valid psychological syndrome?
If I take the basic fundamental tools needed in financial planning, such as different insurance products, investments, and retirement planning options, the acid test is whether or not I can apply these three simple words to each of them. Let’s start with something as basic as car insurance. Can I use it today? Well, I don’t really want to, but when I was in that head-on collision in 2008, I did. Can I enjoy it today? The girl that hit me had no insurance, so because I had the correct coverage, I was able to buy another car four days after the wreck. Can I control it today?If my safe driving record continues going forward, and I manage my deductibles accordingly, yes, I can control the costs & benefits. …how am I doing so far? Keep reading…it gets better.
How about my home? Can I use it today? Absolutely…its my home and I love not only being there, but entertaining my friends and clients. Can I enjoy it today? Same thought applies. Can I control it today? Well…kinda sorta. I can control my ability to make the mortgage payment. I can refinance the loan when it’s appropriate and in my best interests…but I cannot control the market value. Just like you, I took a hit as the Nashville housing market continues to decline. My home is a great asset, but it might not be a great investment.
A 401(k) plan, you ask? Let’s see if it holds up. Can I use it today? No…not without subjecting it to income taxes and possible premature withdrawal penalties (if you’re younger than 59½). Can I enjoy it today? No…it is a retirement account, and any enjoyment is deferred until a later date. The same rules apply here as well. Can I control it today? No…the market fluctuates on a daily basis and I’ve never met anyone who has consistently outperformed it. Also, since it is a tax-deferred account (postponed is a better word), the government will probably have it’s say as to how much in taxes you will have to pay when you do take $$$ from these types of accounts. Sorry, but retiring in a lower tax bracket might fall into that “financial fiction” section of the bookstore I’ve wrote about in the past.
And finally, the most misunderstood financial tool of them all…life insurance. First of all, term insurance. Can I use it today? Me personally, no…my beneficiaries can. Can I enjoy it today? …only the thought that if I leave this world, I do so knowing I left it a little better than I found it. Can I control it today? I can control the amount and the price, but as I get older and less healthy, both will change drastically and generally, not for the better. According to LIMRA, 99% of all term policies do not pay benefits to beneficiaries. 99%...so why do all the “financial entertainers” and other media sources recommend it? (See my earlier thought about the “financial fiction” section.)
Now for the big finish…drum roll, please!! Let’s analyze good ole whole life insurance. Can I use it today? Absolutely…any cash values available in the contract are always liquid for any purpose and if accessed correctly, withdrawals can be tax free. Can I enjoy it today? Yes. Cash values grow tax deferred and have a guaranteed minimum rate of return (usually 3-4%). Current dividends, which are not guaranteed and do adjust annually, have already been declared by companies for 2010 in the range of 5-7%. By the way, regardless of market conditions, this account never goes down. Can I control it today? Yes. Contrary to “financial fiction” I can put as little as possible to keep the contract in force, or as much as is allowed by law to use the cash value as a part of my safe assets in my overall portfolio asset allocation. If you want more proof, go to www.lifeinsuranceasanassetclass.com
Three little words…use, enjoyment, control…hopefully, after reading this, you recognize that they have clout…and they can empower you to make better financial decisions. If you use them in the way that I do, maybe you will begin to have a different understanding of how you should use money…and a clearer idea of what is “financial fiction”, how you should look at “financial entertainers” and what are the true facts about financial planning.
Kindest regards,
Brian
brian_carden@peachtreeplanning.com
Copyright, 2010, Brian E. Carden
12/04/2009
It's Time
Yes, it’s time for my Christmas article. The “It’s Time” title comes primarily from a new mantra that has been used at UT football games this year. To think that so many Vol fans are excited at a 7-5 record is somewhat incredible, but it’s their optimism for the future of our team and our new coach that drives that emotion. It is amazing how attitudes have changed regarding my Alma Mater in the last 12 months…and the same applies to life in general for many of us.
It’s time for us to forget the frustrations of the year, the economy, the continual negative barrages of the media, and every non-positive thing that has happened this year…for a little while. Just like you, I could list a bunch of stuff that didn’t go according to my plan created when I did my goal setting for 2009. In fact, that list could fill up that page…but that doesn’t solve much, does it?
In looking back at some of my previous December articles, “Memories of the Sears Wish Book” was fun…for those of us that remember it, there was nothing like it…that was the most dog-eared, circled, marked up, and prioritized publication ever brought into the Carden household. Last year’s article was hard, because I wrote about my best friend Duffy, and the 15 years of joy he gave to me and my family…and how hard it was to be without him at Christmas. That picture of him lying under the tree is still taped to my monitor as I write this…and I do talk to him often.
The one that means to most to me was written December 2005 entitled “My Christmas Blessings to You” and it’s special because it’s about two very important things in my life…my family, and the relationships I have with my friends and clients. My greatest gift is (and I hope will be for as long as God allows it) to have all of my family around the tree at Mom & Dad’s house. I used to think that 85 was old, and that’s what Dad will be next month. He might not be as fast as he used to be, but he’s as sharp as a tack. Last week he & I went to a UT basketball game together…just like the good old days…and he hoofed it from the parking lot to our seats and back again…not missing a step! And he climbed a bunch of them!
Being home at Thanksgiving reminded me just how blessed I truly am. And writing this reminds me of the same when it comes to my friends and clients. I can’t remember working any harder than I did this year, and having more fun doing it…especially with everyone here at Peachtree. Dad has always said that the day he starts worrying is the day that everyone stops giving him a hard time…and it’s no exception here. I think I’ve compiled about 3-4 new nicknames around here just this year. Needless to say, we love what we do, we love who we work with, and we love the clients that we are charged to take care of. Our Senior Partner and mentor says that we have the third most important occupation in a person’s life, behind physicians and ministers. We truly believe that and do everything possible to “walk the walk”.
With that in mind, I truly thank each and every one of you for your friendship, your readership, your trust, and your faith in me and the team here at Peachtree. My Christmas wish for you is that if there is something that kept you from having the year you anticipated, whatever that one wish might be, that it’s granted to you. 2010 is a brand new year, and it will be full of opportunities and great things! If you’re reading this, just back away from your computer, close your eyes for a minute or two, and just think of that wish…It’s Time!
Merry Christmas and Happy Hanukkah!
Brian
Copyright 2009, Brian E. Carden
Brian_Carden@peachtreeplanning.com
07/15/2008
The Revised Bucket List
If you haven’t seen the movie “Bucket List”, then go rent it immediately. First of all, Jack Nicholson and Morgan Freeman are together in costarring roles. Secondly, it’s a great story about living when you’re dying. Two guys, knowing that they are each going to “kick the bucket” so to speak…so they’ve created their list of things they want to do before they die…A.K.A. their “bucket list”. I’ve got a lot of living yet to do, but still, I’ve started creating my own bucket list. Funny how the older I get, the faster this world keeps on turning…
I was at an advisor conference last month talking with my new friend Bob from Tarpon Springs, Florida; he brought up the concept of “buckets of money”. Needless to say, the idea of this writing was born. In case you haven’t noticed, a constant theme of my writings has been about transition. If you’re not in one, you soon will be…especially if corporate America has anything to say about it. The traditional financial “bucket list” says keep some money back for emergencies, fund your kid’s college education, fund your 401(k) plan to the annual maximums, retire from the company you’re currently working for, and so on and so forth. (By the way, according to the TV ads with actor Sam Waterston, you can do all of this by yourself using a 1-800 number.)
Since the market has done what the market does, which is go up and down every hour of every day…and the media does what it does, which is scare the common sense out of you, odds are that you’re probably using words like: scared, confused, frustrated, mad, emotional, fearful, etc. You know, those words that keep you up all night worrying…not sure what you’re worried about, but worrying nonetheless.
So with all that said, here’s my “REVISED BUCKET LIST FOR 2008 AND BEYOND”
- Interview and hire a competent financial ADVISOR, not a salesperson of financial & insurance products. Learn to ask the questions to discern between the two.
- Create a written financial plan that is measurable, adjustable, and realistic.
- Learn to stop thinking about only planning for retirement, but focus on your life in five year increments. (Average length of stay in corporate America is less than three years.)
- Know the difference between tax-deferred, tax-free, and tax-deductible. (You might think you’re cheating the government by max funding your 401(k) plan and tax-deferring those dollars, but Uncle Sam knows differently…trust me on that one!)
- Quit listening to the media hype. According to financial industry expert, Alan Parisse, there are 17 negative articles about money & investments for every 1 positive. 17:1!!
- Understand that “safe” is not necessarily “safe”, nor oftentimes, is it in your best interests. This market will turn around, but it will turn like a ski boat…not like a cruise ship. If you miss it, you could be left behind financially.
- Reflect on where you are from different perspectives, such as personal, financial, emotional and occupational. Learn to be grateful for what you have, but recognize that careful planning will be a key component to maintaining these perspectives.
If this resonated with you, it’s time to get out a pen & start working on your “Revised Bucket List”. We’ve all got a lot of living yet to do. If it didn’t, maybe you should plan to do what Jack & Morgan did. The way this world is spinning, who knows what your future holds. By the way, I’m here if you get writers block on your list!
Regards,
Brian
07/15/2006
The DaVinci Code & Financial Planning
Almost every church sign I’ve driven past in the last couple of months has advertised a sermon on this book. Some pastors went as far as to say, “I’ve forbidden my congregation from seeing it.” Sorry…I read the book over a year ago…and saw the movie as well. Both were entertaining…besides, I don’t know what the fuss is about. Because of my faith, I know the truth and where to find the answers to those spiritual questions I ask myself regularly. To me it comes down to the fact that regardless of what one might think of the factual relevance of the storyline, when you go to Borders to buy a copy of the book, it’s always going to be in the Fiction section.
Just as my faith helps me define the truth spiritually, my professional experience, education, and beliefs as a financial planner allow me to know the difference between “Financial Fiction” and what is actually true. In the movie “The Man who Shot Liberty Valance” starring Jimmy Stewart, the hero is not made nor born, but manufactured by the storywriters of that time. As the editor of the newspaper said, “This is the West. When the legend becomes the fact, print the legend.”
Here are a few examples of “Financial Fiction”…Liberty Valance style:
| LEGEND: | You don’t need a financial advisor to create wealth…do it yourself! |
| FACT: | From 1984-2004, the S & P 500 average annual return = 12.2% The average investor = 3.5% (Dalbar) |
| LEGEND: | Knowing what to buy & sell and how to time the stock market is the key to wealth accumulation in investments |
| FACT: | Nobel Prize winning Study says only 2% market timing, 4% investment selection, 94% success rate with Asset Allocation via Modern Portfolio Theory. (Nobel Prize in Economics, 1990) |
| LEGEND: | We’ve all got plenty of time to save for retirement. |
| FACT: | 41% of American households headed by individuals ages 45-54 do not have any retirement savings what so ever. (Congressional Research Service) |
| LEGEND: | The Dow Jones Industrial Average and the S & P 500 index are the leading indicators of how the US stock market is fairing. |
| FACT: | Only 30 stocks make up the DJIA. (dowjones.com) 22% of the largest US companies are not a part of the Index. (Russell, Inc.) |
| LEGEND: | Term insurance is the only type of life insurance you’ll ever need. |
| FACT: | Only 1% of all term policies issued result in death benefits to the named beneficiaries. (Penn State Study, 1994) |
So ask yourself, in your mind, what is legend and what is fact…and where did you get your information. Unfortunately, Borders doesn’t have a “Financial Fiction” section, but if they did, it would probably be full of hundreds of books and magazines with “legendary” titles & cover stories. If you are tired of Fiction and are ready to move over to the History and the Psychology sections, (remember, money has emotion) maybe it’s time to hit reply.
Regards,
Brian
Copyright 2006, Brian E. Carden
Securities offered through Securities America, Inc., Member NASD/SIPC, Brian E. Carden, Registered Representative
Advisory Services offered through Securities America Advisors, Inc., Brian E. Carden Financial Advisor
Past Editions
- In Search of Guarantees
- It's Going to be a Groundhog Year
- Are you Wishing...or Wanting?
- Memories of the Sears Wish Book
- Thanksgiving Memories from my Soul
- You Are Here
- OK What Am I Supposed To Do Now?
- Walking Case Studies, July 2011
- R.E.S.P.E.C.T. June 2011
- OK Now I'm Really Scared, August 2011
- It's All Greek to Me! May 2011
- Really?...Are You Kidding Me!
- What I've Learned from 1983-2011…A Perspective
- The Revised Bucket List
- Trusting in the Holidays
- Walking Down Gene Carden's Road
- The DaVinci Code & Financial Planning
- It's Time
- Use, Enjoyment & Control
- You Really Don't Know What I Do
- Exit Ramps
- Hardware or Software?
- Who Says?
- Backstops
- Recapture and Redeploy
- My View on the World
- Deus Ex Machina
- The Bank Called You
