Curtain Call

 

The Center's Team enjoys sharing their knowledge with the press to help stories come to life, share facts and bring important topics to the forefront.  We are also honored when we are recognized by media and publications for our work and service to our profession. Here's what's new:

Detroit Free Press

Timothy Wyman, CFP®, JD was quoted in the Sunday Free Press on June 27, 2013, in an article titled, “Pension safety net won’t help City of Detroit retirees” by Susan Tompor.

Online Trading Academy

Laurie was quoted on Online Trading Academy on July 8, 2013, in an article titled, “Finance Advice for Grads” by Paige Reinsel.

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Old Habits Die Hard: Are You Spending Enough?

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 I received an intriguing question from a client recently.  His query: “We who are savers struggled initially as young earners to develop the discipline to pay ourselves first.  We have spent the first two thirds of our lives making spending decisions based on debt avoidance rather than conspicuous consumption; all with the goal to make sure we would achieve financial independence in our retirement years.  But now that we’re retired, that deep-rooted discipline comes back to haunt us as we transition into our spending years.  I'm finding it difficult to spend the money now, even though we are financially secure.  Any advice?”

Actually, this is not an uncommon issue with our retired clients at the Center.  There is an element of self-selection that occurs for our long-time clients—they tend to be both forward-thinking “planners” by nature and they have generally demonstrated excellent self-discipline over the years.  It is not unusual that this results in having more financial resources than they might have expected or imagined, and the careful spending habits developed over decades don’t change quickly.

For many, many years, I have defined “financial planning” as the process of finding an appropriate balance between spending now and investing for the future to ensure that all of your financial goals are accomplished throughout your life.  Most people tend to err on one side or another—they either spend so much now that they jeopardize their future goals; or they have far too aggressive savings goals, giving up current quality of life unnecessarily.  In planning, we can quantify what it takes to meet future financial goals, and making sure that we are doing what is needed to help reach those goals—whatever is left can be spent freely and without guilt on those things that are of highest priority.

There are some that find themselves in the enviable position of having more than they need at retirement. Here again, we can quantify what it takes to maintain financial security with some cushion for unforeseen contingencies—

The excess is available for other priorities, which can include:

  • Gifting: to family members or to charities
  • Creating a meaningful financial legacy
  • Increasing one’s annual income to incorporate some “luxury” items or experiences
  • Pursuing passionate interests such as collecting art, fine wine, or extensive travel

My advice to you, if you are in this position, is not to “deny yourself” if there is something you would like to do.  This is not to recommend spending money frivolously; but on the other hand, if there is an expenditure that would improve the quality of your life or the lives of those you care about, don’t hesitate to spring for it—even if it seems “unnecessary”.  The ultimate goal here is to pursue those areas of interest because they are meaningful and important to you, unconstrained by financial concerns.  That, friends, is true financial freedom.

Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Any opinions are those of Center for Financial Planning, Inc., and not necessarily those of RJFS or Raymond James.

 

Keys to Weight Loss Can be Keys to a Successful Financial Plan

 For the last several months, I have been watching my weight with the goal of improving my long-term health.  I have been following the Weight Watchers plan, which has helped me to create some solid habits for weight loss success. 

These same healthy habits can help individuals achieve financial planning success:

  1. Track – Much like dieters should track what they eat, it is important for individuals to track where they spend; this helps to identify areas where overspending might be occurring.
  2. Maintain Discipline – Like dieters need to stick to a plan, individuals with long-term financial goals should have a plan for saving and be committed to it.
  3. Splurge Once in a While – Like a dieter who deprives him or herself for too long and then binges, individuals that have been disciplined at savings should occasionally spend on something fun to enjoy the present … but as a reward rather than a binge.
  4. Be Accountable – Like a dieter should weigh in regularly and be honest with the results, individuals should meet with their financial planner at least annually to check progress and to make any needed adjustments to the plan.

If you have already formed these habits for your financial life, don’t be afraid to meet with your financial planner to check the scale.

Sandra Adams, CFP® is a Financial Planner at Center for Financial Planning, Inc. Sandy specializes in Elder Care Financial Planning and is a frequent speaker on related topics. In 2012 and 2013, Sandy was named to the Five Star Wealth Managers list in Detroit Hour magazine. In addition to her frequent contributions to Money Centered, she is regularly quoted in national media publications such as The Wall Street Journal, Research Magazine and Journal of Financial Planning.

Five Star Award is based on advisor being credentialed as an investment advisory representative (IAR), a FINRA registered representative, a CPA or a licensed attorney, including education and professional designations, actively employed in the industry for five years, favorable regulatory and complaint history review, fulfillment of firm review based on internal firm standards, accepting new clients, one- and five-year client retention rates, non-institutional discretionary and/or non-discretionary client assets administered, number of client households served.

Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constituteinvestment advice.  Any opinions are those of Center for Financial Planning, Inc., and not necessarily those of RJFS or Raymond James.

How investor access keeps you in the loop even when you are on the Go

 We, here at the Center, love to use the latest technology and we’re excited to be able to put it at your fingertips.  Many of you know about Investor Access, the free, online portal designed exclusively for Raymond James clients.  It offers a secure platform to view and navigate your Raymond James accounts.  This is a free service and it is quite user friendly and it is now portable.  Raymond James offers an app so you may use this service on the go!  Designed with the busy client in mind, this app incorporates the features you would have on the full website.  Your detailed information can now be accessed through your mobile device and is just as safe and secure.

Obtaining the app is easy.  Just visit Apple’s App Store, Google’s Play Store, or Window’s Marketplace to sign up.  You will need to be enrolled in the desktop version of Investor Access before adding the application to your mobile device.  Access to the full website can be found on our website under the “Clients” tab.  Need help?  Call us – we would love to help set you up with this technology to make your life easier even when you are on the go.

The app is just one tool in our technology toolbox, enabling us to keep in contact with our clients and each other.  We have the ability to increase our productivity with the help of software programs and databases that allow retrieval of information at a moment’s notice.  We are able to personally communicate with clients via email and through voice over IP services like Skype. Our broad communication is accomplished through Facebook, Twitter, LinkedIn, our company website, and even YouTube.  While these features help make our day a bit easier, it is even more exciting when we have technology that will make your life easier!  

Breaking the Mold of a Broke College Kid

 

This blog is contributed by the Center’s summer intern, Zach Gould, who is a senior at the University of South Carolina. He shares his take on how students can take charge of their finances:

Let’s face it, college students are notoriously broke. During the school year, I don’t have a job because I plan and budget so I can focus all my attention on school. That means, when summer rolls around, I work at least 40 hours a week for 10 weeks or more, which is what I’m doing at the Center this summer. While I’m working, I try not to spend much money. My goal is to save at least 80% of my summer earnings so I’ll have it to spend during the school year. Because who wants to eat cafeteria food for 9 months? And you have to have cash for dates, movies, and a very occasional trip to the bars (wink).  So, once school starts I see how much money I have left from summer and budget that over the 9 months that I’m in school. I also plan for extra spending in December because of the holidays. Can you tell one of my majors is finance?

It is not impossible to maintain a job during the school year. A lot of my friends work part-time while going to school and are, in many cases, more organized than me because they are forced to be. This also provides income during the school year, which if you are paying for college yourself, certainly is necessary. If you’re not paying for college out of pocket, it is simply more expendable income. But holding down a job while going to school does have drawbacks, like limiting your ability to be a part of a lot of clubs or teams. Either way, after three years of making ends meet on a college student budget, I've learned a few things.

This is what I’ve learned:

  1. Start saving early for spending money in college. You are on your own and expenses previously covered by your parents are now funded by you.
  2. Budget the money you make while working during summer so it can last you throughout the school year, especially if you don’t plan to have a job while in school.
  3. It is possible to work and attend school, which will give you more flexibility with income. You must, however, be very organized and limit your hours to make sure you are achieving social and academic balance as well.

I’ll head back to college in a month with most of my summer earnings in the bank. It takes budgeting and careful planning not to blow it before the end of the first semester, but I know the skills I’m using now will really pay off in May when I graduate and am truly on my own.

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

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3 Lessons Investors Can Learn from Miguel Cabrera

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 I grew up in a sports-loving household – playing sports and watching sports was a large part of my youth.  It should not be surprising that many of my key life lessons have been learned through sports analogies.  As I watch Miguel Cabrera -- one of the greatest hitters in Major League Baseball --  I can’t help but notice how investors might learn from three of his key skills:

  1. Always keep your eye on the ball – Remember that your investments are tools to get you to your planning goals; don’t let the ups and downs of the market cause you to lose sight of your long-term goals.
  2. Swing for a base hit – Keep your investment strategy balanced and stick to the fundamentals.  Taking big “swings” with trendy investment vehicles or making big shifts in your allocations may put you at risk for striking out.
  3. Hit for average – The goal of your investment portfolio should be to return what is needed to reach your financial planning goals within your tolerance for risk.  Maintaining a moderate, but positive, average return over your financial life can get you farther than those who try to swing for the fences, but strike out more times than not.

As you are watching your favorite baseball team this season, keep in mind that the best hitters, like the best investors, stick to the fundamentals.  And don’t forget, your financial planner can be your most valuable hitting coach.

Sandra Adams, CFP® is a Financial Planner at Center for Financial Planning, Inc. Sandy specializes in Elder Care Financial Planning and is a frequent speaker on related topics. In 2012 and 2013, Sandy was named to the Five Star Wealth Managers list in Detroit Hour magazine. In addition to her frequent contributions to Money Centered, she is regularly quoted in national media publications such as The Wall Street Journal, Research Magazine and Journal of Financial Planning.

Five Star Award is based on advisor being credentialed as an investment advisory representative (IAR), a FINRA registered representative, a CPA or a licensed attorney, including education and professional designations, actively employed in the industry for five years, favorable regulatory and complaint history review, fulfillment of firm review based on internal firm standards, accepting new clients, one- and five-year client retention rates, non-institutional discretionary and/or non-discretionary client assets administered, number of client households served.

Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute investment advice.  Prior to making an investment decision, please consult with your financial advisor about your individual situation. Any opinions are those of Center for Financial Planning, inc., and not necessarily those of RJFS or Raymond James.  Investing involves risk, and investors may incur a profit or a loss.

Happy Centerversary

 Join with us as we celebrate two Center team members Centerversaries.  Jennie Bauder a Client Service Manager at the Center who, as of this month, has been a part of our team for 10 years and Gerri Harmer a Client Service Associate, who has been part of our team for 6 years. We like to honor Center employees when they reach a "Centerversary" because we value experience and committment (and quite frankly, we just like having Jennie and Gerri around)!  

We are proud to take a moment and recognize both Jennie and Gerri.  Managing Partner Tim Wyman said it well, "We are fortnuate to have you both."  

When we asked Jennie how it felt to reach the 10 year mark she said, "Working at The Center has endless rewards and has given me so much over the last 10 years.  It is a workplace I enjoy coming to every day and has a family feel amongst my co-workers and Center clients."

Gerri had these thoughts, "It's exciting to work in such a positive team-oriented environment with phenomenal staff and absolutely wonderful clients."

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Signs Say Housing is Back

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 If you haven’t noticed here locally, the housing market has really changed.  A client told me of a house they tried to purchase in the Detroit suburbs that had 70 offers last week. It was just two or three years ago when you couldn’t give these places away.

A recent well-known gauge for housing, the S&P/Case-Shiller 20-City Composite Home Price Index, which was released in May, posted the biggest gain in seven years.

The 20-city index--one of several S&P/Case-Shiller housing indices--showed a 10.9% gain between March 2012 and March 2013, the highest increase since 2006. In addition, all 20 cities tracked by the index had gains for three straight months. But not all markets are equal. Consider that San Francisco and Phoenix saw large price jumps of more than 20%. However, New York and Boston had smaller gains of 2.6% and 6.7%, respectively.

Also consider that all economic assets are eventually just a supply/demand equation. Prices should be rising given the low supply of homes, less new construction, relatively low prices, and low mortgage rates.

As for the economy as a whole, rising home prices often serve as an indicator that the economy is performing better since it generally demonstrates increased consumer confidence. And while this latest report is good news for homeowners looking to sell, it also provides welcome news to underwater homeowners who may now see an increase in their home equity.

Another gauge of the housing market is that a large number of institutional investors are buying properties to rent—suggesting that there is still a ways to go in terms of a full-fledged housing recovery.

You may hear people worry that another housing bubble is in the cards. Well not so fast! Consider that this economy is built on different terms than the one that led to the housing bubble burst in 2006. Those differences include a tighter mortgage lending environment and houses that may still be undervalued at prices that are significantly lower than they were at their 2006 peak.

Matthew E. Chope, CFP ® is a Partner and Financial Planner at Center for Financial Planning, Inc. Matt has been quoted in various investment professional newspapers and magazines. He is active in the community and his profession and helps local corporations and nonprofits in the areas of strategic planning and money and business management decisions. In 2012 and 2013, Matt was named to the Five Star Wealth Managers list in Detroit Hour magazine.

Five Star Award is based on advisor being credentialed as an investment advisory representative (IAR), a FINRA registered representative, a CPA or a licensed attorney, including education and professional designations, actively employed in the industry for five years, favorable regulatory and complaint history review, fulfillment of firm review based on internal firm standards, accepting new clients, one- and five-year client retention rates, non-institutional discretionary and/or non-discretionary client assets administered, number of client households served.

The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material.  The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete.  Any opinions are those of Center for Financial Planning, Inc., and not necessarily those of RJFS or Raymond James.

The Prescott tragedy hits close to home

 Founding Partner of The Center, Daniel Boyce, lives in Prescott, Arizona, just miles from where the Yarnell Hill Fire that took the lives of 19 firefighters. The tragedy was the greatest loss of life for firefighters since Sept. 11, 2001 and hit very close to home for Dan and his wife Sue. He shares his thoughts:

The loss of 19 elite Arizona firefighters is a devastating blow for our small city, made all the more poignant for all of us since the same crew had been active in putting out a larger fire much closer to Prescott just a week or so earlier. That fire started just 4-5 miles due west from our house, and within 9 hours was over 5,000 acres in size. Had the wind been from another direction, we would have quickly been in the "line of fire"; as it was, we had our car packed with our most important stuff, our cats sequestered to be able to grab them quickly, and were ready to evacuate if the winds had shifted. But thanks to more than 600 firefighters battling for over a week on rugged terrain, in the end there were amazingly no structures burned or serious injuries.

The Yarnell Hill Fire, where the tragedy occurred June 30th, is about 15-20 miles south of us. We saw the air tankers loaded with fire-retardant slurry headed in that direction--run after run--little did we know what would ensue. Things around here have been tinder dry, and it has been unusually windy, making fire conditions extremely hazardous.

Sue and I sang in the choir at the memorial service for the 19 firefighters from Prescott. It was held at the largest arena in the area and still thousands who couldn't fit in sat outside to watch the service on jumbo screens. Though Sue and I don't know any of the fire victims personally, in a town of this size (~100,000) there is generally only one, or at most two, degrees of separation. It was an extraordinarily moving service and it reminded me once again how fortunate we all are, and how important it is to share our gratitude with those we care about.  So I'm doing just that.  Thank you for being an important part of my life.

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