February 16, 2022 – The “Wednesday Weekly” has now been published for six months. We hope the content has been informative and thought-provoking, as that was our objective when we began.
The competition for our attention is fierce. Family, children, jobs, and sleep are all that most people can focus on in one day. Weekends sometimes open up a bit, but are quickly filled with the “weekend warrior” activities we have all come to expect. Managing finances is essential for many reasons, and, unfortunately, seems to have a permanent place on the “to-do” list.
In our country, financial literacy continues to be a big issue. The financial press and media do little to help, as their focus is on fueling our intrinsic emotions regarding finances – “fear and greed.” It may not support the “common good,” but it sure sells! Surely, the financial services industry will step in to fill this void and help us through this “financial fatigue.” Not so fast! In my essay “You’re Wealthy, What’s Next,” I outline the difficulties you will face when you become serious about your financial future and our Financial Life Guidance approach.
I will admit that I have no clear plan on what topics I write about each week, but I know that the essays cover topics that I believe will be impactful to my clients and other readers. I also know that my primary objective is not to have you learn, but rather to make you “think.” The writings provide a perspective on situations we all will face at some point. If it is now, you can take appropriate action. If not, it gives you the ability to plan or be prepared when the time comes. Each person is so unique that my attempt at providing “solutions” is noble, but experience tells me there is always a “special situation.”
A review of past essays has led me to four key themes: 1) Healthcare, 2) Personal Finance and Economics, 3) Human Behavior, and 4) Financial Life Guidance.
We all know the importance of maintaining a healthy lifestyle. But have you thought about how your health affects your finances? Reflect on “Healthcare Planning- A Missing Piece” to understand the interdependencies. Media and advisors focus on maximizing savings for two life events: retirement and education. This is important for sure, and even more attractive given the impact of the trillions of dollars in savings have on the profits of the financial services industry! But what about saving for healthcare costs? The IRS has provided some real incentives for this inevitable cost with Flexible Spending Accounts and Health Savings Accounts. Not a lot is written about these plans because, quite frankly, the amount of savings “in play” is dwarfed by retirement savings programs. However, in “Health Savings Plans – A Planning Home Run,” I provide some great ideas to maximize their benefit. I would be remiss not to focus on our seniors’ healthcare issues. In the essay “Approach Your Golden Years with Healthcare Confidence,” I discuss the real fears held by our seniors but also provide a perspective that “things might not be as bad as they look.” And providing a view on the interplay of planning ideas and ethics, consider “Medicare Planning and Your Moral Compass.”
I can see certain commonalities with 20 years of experience guiding clients on many financial opportunities. Rarely does vacation homeownership not creep into our discussion. It may be part of their goal-setting session or when they return from an incredible vacation experience. It is a big decision and “A Vacation Home – Beyond the Numbers” can provide some insight. Likewise, the decision to take, refinance or pay off a mortgage is standard for almost all clients. “The Wisdom of Borrowing” gives perspective on the role of debt in your financial plan. We realize that among the highest priorities in a person’s life are their children and pets, and each requires an unbelievable amount of sacrifice. Ensuring your child is positioned correctly for their financial future is a concern for most parents and is addressed in “How To Teach Your Kids Good Money Habits.”
No one is eager to pay Uncle Sam “More Than Your Fair Share,” and we make sure our clients do not. The volatility of the stock market made me consider a whimsical essay, “Halloween Lessons To Guide Your Portfolio,” as well as addressing the specter of rising prices in “Who Should Worry About Inflation, and Who Should Not.”
As Financial Life Guides, our understanding of behavioral finance is equally important to our clients, as is our technical competence in finance. Helping our clients acknowledge behaviors and biases that may alter their feelings about a financial decision, and ways to cope with stress or deal with change, is way more impactful than trying to “pick the next Apple or Amazon” investment. One of the constant “truisms” we impart upon our clients is “the only constant in life is change.” Consider how “Lessons to Help Your Future Self” and “Starting Over” could help you cope with the change you will inevitably face. And our holiday-themed essay “The Gifts That Keep Giving” attempts to harness your holiday stress into positive outcomes for you and your loved ones.
Much has been written about the importance of mindfulness and maintaining the proper mindset. Cognitive-behavioral theory teaches that your brain’s sequence of events is thoughts, emotions, and action – in that order and usually performed in a split-second. Changing behavior (actions) will require a change of mindset (thoughts). Easy to understand, hard to accomplish, as us perennial dieters know. I believe that a key to the proper mindset is optimism! I outlined my rationale in “Be Optimistic, Achieve Optimal” and “Silver Linings Playbook,” which emphasize the power of being optimistic – the glass is half full, and every problem is an opportunity! I am also concerned with self-proclaimed perfectionists,and the impact of striving for perfection, as outlined in “The Perfect 10, Or Not.”
While all these essays portray our thinking and approach to “Financial Life Guidance,” we try hard to guide anyone we come in contact with to become self-sufficient and able to control their financial future. The essay “Ask Yourself These Questions, or I Will” provides insights into the power of self-reflection and a tool we constantly use with our clients.
I hope you will be able to carve out some time to explore the messages in these essays that might be of interest to you. Let me know if they help or if further clarification would be beneficial. Also, please provide me with any topics you would like me to cover in future essays, and as always, feel free to share this with anyone who might find the readings helpful.