Live From Orlando: Top Advisors Tell All on Junior Partners

Registered Rep: by Diana Britton on May 22nd, 2012

Advisor panel speaks about adding junior partners at conference.The worst thing you can do when bringing on a junior partner is to immediately anoint them as heir apparent, said Daniel Boyce, FA and founding partner of the Center for Financial Planning in Southfield, Mich. “That is backwards in my estimation,” Boyce told attendees of Raymond James Financial Services’ National Conference for Professional Development in Orlando, Fla.

Any potential partner needs to earn their right to sit at the table with the partners, Boyce said. Give them the opportunity, but wait for them to step into that opportunity before you give them that reward.

Boyce, head of a $700 million AUM firm, joined other top advisors on a panel session discussing the dos and don’ts of recruiting junior partners. Boyce just brought on a new partner recently, Melissa Joy, who joined the panel to share her insights.

Boyce’s motivation in bringing on Joy was not to transfer clients over to her, as his firm already had an ensemble practice in place for that. The age differential was the motivator; he wants successors of different generations. Joy is in her 30s, he said.

Todd Sanford, branch manager of Sanford Financial Services in Portage, Mich., said his return on investment in bringing Scott Williams into his practice was so high that it would probably rival buying Apple a decade ago.

For Sanford, bringing on a younger partner was a tool for expanding the firm’s generation reach, as Williams could work with people with similar life experiences and serve younger people referred to the firm.

But you can’t just hire a junior partner the moment you need them, Sanford said. You’ve got to hire that person years before you need them.

Boyce said his role at the firm has changed over the years, to become a mentor for planners and staff. He says that role is probably the most satisfying for him, and it’s also the most important. Boyce says you can’t view your staff as an expense, but an investment.

“It’s the human capital that is your biggest asset and resource.”

Do you agree?

Kacy Wyman Fun Run Recap & Thanks!

The weather was fantastic May 6th, 2012 for the 6th Annual Cystinosis Fun Run. With the sun shining, people and pooches gathered to support Kacy Wyman, who continues her journey with Cystinosis, for a 5K Fun Run, Walk and Bike event. More than 300 people participated raising over $20,000! 

"Our gratitude is immeasurable for the amount of support we have received and continue to receive," says Tim Wyman. "The Fun Run is just one example of that support."

The Detroit Free Press ran an article May 13th, 2012 about the event and Kacy's journey. Click here to read.

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Research Trip to Wall Street

In April, Dan Boyce and Melissa Joy joined a small group of financial planners for three days visiting Wall Street Firms. With an exclusive group of 30 participants from around the country, discussions were highly interactive. The main focus of the meetings was on Asset Allocation and Portfolio Construction in today’s market environment. Main sessions were held at Blackrock, JP Morgan Asset Management, and Goldman Sachs Asset Management.

The low interest rate environment and future return scenarios for bonds was an enduring theme across firms. It was interesting to see different strategies and perspectives based upon individual firms. Perhaps not surprisingly, the European debt crisis was also a dominant topic. We also always find value of being able to “look under the hood” of financial firms on their turf.

In addition to the larger group meeting, Melissa visited portfolio managers at IVA and American Century. Intellectual curiosity is a cornerstone of our research process and an important component to our investment committee decisions is hands-on due diligence. One of the highlights of the trip was sharing ideas with other financial planners and wealth management firms. We value insights from our peers and are always open to new ideas.

Staying Connected – A Key Factor in Retirement Success

 If you ask most pre-retirees to describe their vision of a successful retirement, you would likely hear words such as family, friends, hobbies, and travel.  You would likely NOT hear someone express a desire to be alone and inactive.

Research shows that individuals who experience isolation and inactivity are much more likely to be diagnosed with depression, memory and other health-related problems.  One such study conducted by Lisa F. Berkman, an epidemiologist at Yale University, found that people who were not connected to others were three times as likely to die over the course of 9 years as those who had strong social ties.  Even more interestingly, the same study found that those with strong social ties and poor health behaviors lived longer than those with poor social ties and positive health behaviors. 

An expanded version of retirement planning is needed to look beyond income distribution planning and investment policy statements.  Planning to maintain vital social connections, whether they are family members, friends, church members, dance partners, etc., seems to be just as important to success in retirement as the stability of your investment portfolio.   So as you or your loved ones plan for retirement, think about exploring activities and hobbies, groups and clubs, and consider living arrangements for all of retirement, including early and later retirement.

Contact your financial planner to develop a retirement plan that includes all aspects of your financial life, especially the all-important social connections.

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Source:www.hsph.harvard.edu

Transfer On Death

 Estate planning is all about getting WHAT is valuable to you distributed to WHO you want, WHEN you want after you are gone.  Getting assets distributed in an efficient and cost effective manner is also important.  Avoiding costs of money and time can be accomplished by avoiding the court system for the distribution of an estate.

Probate avoidance is a common estate planning goal for many people. And, rightfully so.  While the probate process has been simplified over the years, the fact remains that the probate process continues to be time intensive and potentially costly. In many cases, a revocable living trust is used as a financial tool to avoid probate.  Another less known vehicle is the Transfer on Death (“TOD”) designation that can be added to accounts such as bank accounts and taxable brokerage accounts.

A TOD account acts much like a beneficiary designation on an IRA, 401k or even life insurance policy.  At the owner’s death, the account bypasses probate and is paid directly to the person named on the TOD form.  Some firms may charge $50-$100 to establish a TOD, but many also provide such an account for free, making this a cost effective alternative to having a Living Trust drafted.

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Any opinions are those of Center for Financial Planning, Inc., and not necessarily those of RJFS or Raymond James.

Picture the Center!

 

Sell in May and Go Away

 Along with the warm weather, spring always brings about the old debate of whether it is a good idea to, “Sell in May and go away.”  Markets tend to have their stronger performance between October and May, which has certainly held true in the past year. 

There are many theories as to why this could be true:           

• Investors tend to fund their IRA accounts either early or later in the year
• Lower summer productivity for business
• And the most obvious, people prefer to be outside rather than inside investing their money
  (especially in Michigan).

However, this year could be different. If you look at monthly returns in Election years (which like it or not we are in the middle of) the above picture is contradicted.

Beware of strategies involved in short-term timing of the markets.  Many investors end up hurting themselves by trying to time their investments in and out of the market.

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Source:  The Big Picture  http://www.ritholtz.com/blog/

Dealing with Death: A Financial Guide

 Emotionally and psychologically, handling the loss of a significant relationship is one of life’s most difficult tasks. But it’s the additional stress of handling legal and financial affairs that can feel like enough to put you over the edge.

There are a handful of items that need to be handled immediately.  Most decisions can, and should, be left for a later date when grief has been handled and clearer heads can prevail.

Here are the top 5 things you can’t put off:

1. Look for instructions that the deceased may have left regarding preferences for funeral and burial arrangements.  This may be part of a larger document called a Personal Financial Record Keeping System and Letter of Last Instruction, a document that provides important information about professional advisors, documents and accounts.
2. Locate important legal documents, including the will and trust, if one exists.  This will give guidance regarding who has been named to handle the financial affairs of your loved one and how funds can be accessed to pay for funeral and other costs.  Other important documents may include prepaid funeral plans, safety deposit box information, and marriage, birth and other identification like driver’s licenses.
3. Contact the Deceased’s financial advisor.  The financial advisor will likely have copies of any/all legal documents, as well as a complete list of all financial assets and insurances.  The financial advisor will be instrumental in helping to settle the estate and will be invaluable in helping to make important financial decisions later.
4. Get Multiple Copies of the Certified Death Certificate.  These documents will be important in settling all of the financial affairs of your loved one, and can be more difficult to obtain later.
5. Notify Income Providers.  This includes Social Security, employers paying pensions, etc.  Stopping income payments immediately prevents the need to repay them later.

It is most important to deal with your grief and to give yourself and your family time to honor your loved one.  Many of the rest of the financial decisions and affairs can be handled when the time is right. 

Contact your financial advisor for additional guidance.

Any opinions are those of Center for Financial Planning, Inc., and not necessarily those of RJFS or Raymond James.

Your Legacy in a Letter

 In April, to celebrate his 79^th birthday, my father had a special gift up his sleeve for our family.  It started as an idea and, over a period of two years, with pen to paper dad wrote his story.  It was a labor of love for him and came as complete surprise to us. “This story must begin with a little background information,” is the first sentence of a truly remarkable gift of personal memories and milestones, accomplishments and wisdom. 

Times and things change, however, writing letters to share wisdom, preserve tradition, record family history, explain and inspire is not a new concept.  In fact, letters like the one from my father are most commonly known today as ethical wills or legacy letters.  Until I received a legacy letter, I could only imagine the impact and value a gift like this carries. 

Estate planning documents like wills, trusts, and beneficiary designations are legal documents which typically are used to control the distribution, management and availability of assets from one generation to the next.  Legacy letters are not legal documents.  They pass on personal values and the nuances of your story.

There are no hard and fast “rules” for writing legacy letters. The contents and form of your letter are entirely up to you. You can tell your kids what you hope they’ll accomplish, tell stories about your grandfather, or relive the time you made a key tackle on the one-yard line to preserve a win for your high school football team.  Embellishment is allowed!

Here are some ideas to help you get started:

• Decide who you are writing to . . . .
• Speak from your heart in your unique voice  . . . .
• Life has taught me . . . .
• Some of my special memories are . . . .
• I believe . . . .
• Defining moments  . . . .

The beauty of the written word is that it can be handed down for generations to come.  Don’t hesitate – get started today.  Legacy letters are the perfect gift for any occasion!