Last week I seemed to cause a bit of a kerfuffle when I wrote about which life insurance may or may not be appropriate for the general consumer. For the readers that sent in emails and comments – thank you! It’s much appreciated and we enjoy the feedback. Twitter was also flitting and chirping with the commotion. In particular, the discussion really narrowed down to, and most of the comments we received were regarding the comment I made on life insurance not being an investment. And that’s still true. It’s not. Now there are plenty of people that will argue with me that it is an investment for this reason or that. For this writing I am hoping to explain and to clarify what I meant as an investment. From a pure investment standpoint – meaning saving and investing one’s money for retirement and or college or just saving and […]
fiduciary
What is the Best Life Policy to Buy?
When researching the appropriate life insurance to buy individuals and couples are faced with a myriad of choices. Term, whole life, universal life, variable universal life are just a few of the policies that may be presented, if not sold, to the person. So which one is best? Generally, it depends. If someone is looking for the best bang for their buck and wants to purchase the most insurance for the least amount of money term is going to be the best bet. Term is cheap, builds no cash value, and is generally used if someone or couples have a time frame where they need insurance (30 year term for a 30 year mortgage or 30 year term until retirement age). Generally those that are interested in term know that it will run out, but are hoping to “self-insure” their death at retirement since in theory they’ll have saved enough […]
Share, tweet, print, email, like or pin this post:
A Note About Designations
As you begin to seek advice regarding your savings and investments, you may come across professionals that have designations after their names – some might even have a can of alphabet soup! Here are some common designations you’ll encounter when seeking out a professional. Your advisor should have a qualified designation as a minimum requirement before you start working with him or her. CFP® – CERTIFIED FINANCIAL PLANNER™. This designation is considered the “gold standard” in the financial services industry. Holders of this designation are required to take college-level financial planning courses, have three years’ experience in financial planning, and must pass a rigorous 10 hour, 2 day examination. The designation is owned and awarded by the CFP Board of Standards. www.cfp.net ChFC® – Chartered Financial Consultant™. This designation is right in line with the CFP® with regards to the knowledge needed and required to earn the designation. Professionals that […]
Share, tweet, print, email, like or pin this post:
Baby Steps
One of my favorite movies has to be What About Bob? starring Richard Dreyfus and Bill Murray. Fans of the film will remember Bob Wiley, a neurotic, compulsive individual who seeks out the advice and care of Dr. Leo Marvin. The title of Dr. Marvin’s book that he gives to Bob is called Baby Steps – with the idea that anything is manageable and possible if you take baby steps. Baby steps are important in our everyday life. Whether it be pursuing a degree, saving for retirement or even trying to change or break a habit – you need to take it one step at a time in order to achieve the goal. And sometimes, just moving forward even at a snail’s pace is progress. Take saving money for example. Some people may think it’s tough to save, especially if they fill their budget is tight enough already. But these […]
Share, tweet, print, email, like or pin this post:
There’s No Free Lunch
Recently I had the opportunity to review a company’s website and some of their affiliations that they had with particular companies. My natural tendency is to look at what companies the firm recommended when it came to financial advising and investing. As I was perusing through the list of providers my eyes came across a rather intriguing headline that was given by one of the “preferred” vendors. The headline read, “Free Financial Plan – Over $1,000 Value!” Some of you may be wondering the same thing I was wondering: “Who in their right mind would give away $1,000?” Instantly I knew there was a catch. After doing a bit more research I found out that this “preferred” provider’s strategy was to simply create a “financial plan” that was geared toward having the clients invest and put money in financial products that paid high commissions. The take away from the article […]
Share, tweet, print, email, like or pin this post:
Do Advisers Practice What They Preach?
With a cornucopia of information available to us regarding investing, financial planning and money management making a choice between who’s right and who’s not even in the same area code may come down to what your personal preferences are, and just as important, if the person giving the advice practices what they preach. In a previous article, I spoke about how advisers get paid and the type of advice or products they may recommend depending on how the advisor gets paid for that advice. In this article I want to expand a bit further to whether or not the advice you’re getting is really being followed by the person giving it. Admittedly, there is some advice that may need to be given that may not pertain to the adviser giving it. One area may be debt reduction advice if the adviser doesn’t have any debt (but has practiced good money […]
Share, tweet, print, email, like or pin this post:
Book Review: The M Word
Subtitle: The MONEY TALK Every Family Needs to Have About Wealth and Their Financial Future This book, by Lori R. Sackler, presents to us a very insightful overview of the types of conversations that families need to have with one another – beginning with spouse to spouse, following with intergenerational conversations – about money topics. These conversations are critical to the success of most all financial plans that require some interaction between two or more people. Mrs. Sackler has a great deal of experience with the topic, having for several years hosted a radio program dealing specifically with this subject. It is this wealth of experiences, coupled with her own clients’ experiences, that really delivers a wonderful array of knowledge about the process. Throughout the book are excellent examples, which provide the reader with a portrait of each concept, in the flesh as it were. The book walks you through […]
Share, tweet, print, email, like or pin this post:
A Stable Pyramid
One of the basic fundamentals regarding financial planning and saving money revolves around what is known as the financial planning pyramid. You may hear other names such as the wealth management pyramid, the financial house, etc. You may also see different stages or “building blocks” added here or there, but I’ve broken it down for the purpose of this book to three basic levels for easier understanding. The first level is where we see risk management. This is the foundation of your plan. It’s important to have a strong base to build off of, otherwise the slightest of breezes or tremors can send it toppling. Risk management can be simply seen as your insurance – and this can range from your auto, home, renters, life, health, disability, and umbrella insurance, to your will, emergency fund, and debt management. The reason why insurance is the base is due to the fact […]
Share, tweet, print, email, like or pin this post:
5 Essential Financial Planning Steps for Your 30s and 40s
(jb note: the article below is from my friend Roger Wohlner, who blogs at The Chicago Financial Planner.) Many of the calls that I receive are from folks in their 50s or 60s who are either within sight of retirement or already retired. Many of these callers are pretty well-prepared for retirement and are seeking my help to fine-tune their situation and/or to help them through this next phase of life. This type of financial readiness doesn’t just happen it takes planning and preparation. Here are 5 essential financial planning steps for those of you in your 30s and 40s to help you reach your retirement goals and more importantly to help you achieve financial independence. Get started If for whatever reason you haven’t done much of anything to ensure your financial future it’s time to get going. Today is the best day to get started, tomorrow is the second best […]
Share, tweet, print, email, like or pin this post:
Fees
What you see is what you get – or what you don’t see is what you get. As you start or continue to invest and save for college, retirement, weddings, vacations, and other goals it’s important to know the underlying fees and charges of the products and funds that you’re in. Very often these fees are buried in the minutia of a thick prospectus or in the fine print of your account statement. Fees are necessary, but excessive fees aren’t. You should be getting what you pay for – but that can be hard if you don’t know what you’re paying. Let’s take mutual funds for example. On one end you have fees and expenses going to the fund and the manager to try to do the best with your money – which is to earn a decent return (positive or negative) and hopefully beat their benchmark. This is typically […]
Share, tweet, print, email, like or pin this post:
The Crystal Ball
Every so often we get asked by our clients or prospective clients which direction the market is going to go. This is always and entertaining question to get – and some of our “regulars” already know the answer. Having a bit of a sense of humor (albeit dry sometimes) I’ll joke with clients and tell them that the day they handed out crystal balls in my investment class, it was the one time I called in sick – and you only get one chance at the coveted crystal ball. Thus, I forever lost the opportunity to predict the future of the markets. Darn. Inevitably, clients laugh and understand the joke – and take away the underlying theme of the jocularity – that we can’t predict the future, especially in securities markets. But this doesn’t mean we can’t plan ahead. So why do we invest? Why do we save for retirement? […]
Share, tweet, print, email, like or pin this post:
How Financial Advisers Get Paid
As you begin your search for a financial professional it’s going to be important to know how the particular professional you choose will get paid. It will also be important to ask questions not only in regards to their compensation, but who actually pays the adviser. There are generally three ways in which financial advisers and planners get paid. Commission: An adviser that’s paid on commission generally gets paid based on the underlying product they sell. Commission rates vary depending on the product sold – anywhere from 5% to 50%. Term Life insurance for example, will have roughly a 40% commission rate on the annual premium for the first year. Whole Life insurance is generally 50% the first year. The difference being Term Life may have an annual premium of $1,000 where Whole Life may have an annual premium of $5,000. It can be difficult to be objective when an adviser can make $2,500 versus $400 […]
Share, tweet, print, email, like or pin this post:
Why Hire a Professional?
Throughout our lives as different life events happen and the need for help arises we have the opportunity to rely on ourselves to get the tasks done, or entrust in the skill and expertise of a professional. Very often there’s a fine line as to what we’ll bother doing ourselves or to whom we’ll hire and delegate the job. For mundane tasks, the tasks that we know we can do ourselves with little to no effort, it’s second nature for us to roll up our sleeves and get the job done. Examples of this include washing the car, cleaning the house, balancing the checkbook, bandaging a small cut, and doing the dishes. It’s rare that we’ll “contract out” these tasks as they are very limited in the expertise needed to get them done, and from a frugality standpoint, most of us are willing to accept the trade-off of doing the […]
Share, tweet, print, email, like or pin this post:
Why Designations Matter
Throughout my career I have had the occasion to talk with several financial advisors, planners, insurance agents, brokers, and other industry professionals about some of the reasons why people choose to pursue or not to pursue designations. I have heard differing views on the topic and thought I’d share some of my insights as to why I chose and still choose to pursue designations and degrees. Before I do, let me start by talking about some of the reasons why the advisors I have spoken to decide not to earn a designation. More often than not, the typical answers that I receive are not having enough time, not sure which designation to pursue, lack of funding to afford the designation, and lack of support on earning the designation – either from their employer or family. On the latter two points, some companies may not be able to “support” the designation […]
Share, tweet, print, email, like or pin this post:
Financial Planning Pyramid: Foundations
You can’t build a house from the top down, right? Like most solid structures, they start with solid base, a firm foundation. Some of the biggest skyscrapers are started below ground level, well beyond what’s in our view when we look at the behemoths of structures. Can you imagine a skyscraper built on just a foundation of concrete? The first strong wind or tremor would send it toppling. The same process can be applied to financial planning. You have to have a solid base, a firm foundation before you can think about building a portfolio, estate planning, etc. Generally, the financial planning pyramid starts with the base known as risk management. This includes such risks as auto and home insurance, an emergency fund, life and disability insurance, and a will. Having this solid base protects you from many risks in life, but also protects your plan and your money that […]
Share, tweet, print, email, like or pin this post:
Financial Autonomy
Recently, I had the opportunity to sit across from a couple nearing retirement, and looking for some options with regards to their cash flow needs, possible retirement dates, and the ever-present question, “Do we have enough?” Typically, these conversations involve careful consideration given to a number of different worries, fears and “big” problems that clients face. Frequently I will work with couples who have a hard time agreeing on how much they can spend in retirement, how much the can afford to save, and where to prioritize and allocate the money (to retirement, a wedding, college, etc.). This couple, however, was different. Well in position to enter retirement comfortable with little, if any to worry about, the tension between these two spouses could be cut with a knife – it was almost tough to sit through. One would snip at the other, and the other would interrupt while the snipping […]
Share, tweet, print, email, like or pin this post:
Book Review: Low Fee Socially Responsible Investing – Investing in your worldview on your terms
Today I’m reviewing a book written by a friend and colleague, Tom Nowak, CFP®. Tom is passionate about Socially Responsible Investing (SRI) and he has written a great overview of the concept. He introduces some very good tools that the average investor can use, either on your own or to help guide conversations with your advisor. But SRI concepts are available in many forms from many sources – what makes Tom’s book unique is that he develops a framework that allows the individual investor to implement SRI strategies (or for that matter, any investment strategy reflecting a particular worldview) in a very cost-effective manner. Mr. Nowak starts out with a discussion of fees and how they can have a major impact on your overall investment returns. As you may already know, any reduction that you can achieve on the fees that your investment activities cost you will be returned directly […]
Share, tweet, print, email, like or pin this post:
Book Review – Backstage Wall Street
This was a good book, I truly enjoyed reading it. The primary reason that I enjoyed it so much is because it’s the book I have been hoping to find from someone like author Joshua Brown: a book that tells the truth about what’s really going on on the seamy side of Wall Street (which is the only side, to be truthful). Joshua Brown (TheReformedBroker.com) provides a unique perspective – that of someone who has been involved in the “inside” of wirehouse broker-dealers, but who has since seen the light and moved on to a career in independent investment advice. As such, Mr. Brown has seen the worst of the worst, in terms of how these institutions treat the investing public. Once he became aware of how it all worked, through a great degree of soul-searching (and a whole lot of gumption), stepped away from it all and has never […]
Share, tweet, print, email, like or pin this post:
Book Review – Freedom From Wealth
This book is an excellent resource for folks who have been accumulating wealth over their lifetimes – wealth that is more than they need to live off of. Granted this isn’t everyone, but it’s probably a lot more of you than you think. You don’t need to be a Bill Gates to have these sorts of issues in your path. When you’ve worked your entire life to build up your wealth, you likely want to leave some of it to your children and grandchildren, but is it best to just hand it all over to them at your passing? What if you also hoped to make a difference in the world with your money – perhaps with charitable activities, or to help your offspring to establish their own place in the world, or to leave a legacy, a way that your name can live on? The first part of this […]
Share, tweet, print, email, like or pin this post:
Book Review: Saving Capitalism from Short-Termism
How to Build Long-Term Value and Take Back Our Financial Future This is a great book. I got a lot out of the sections that bring to the surface a lot of the issues that we’ve been seeing in our economy. These issues have been written about in countless places, but author Alfred Rappaport also proposes workable options that could be put into place to resolve these issues, a step that has been lacking in other places I’ve seen these issues discussed. But I’m getting ahead of myself. The issues I’ve referenced above are the sort of systemic issues we’re seeing in economy in general and specifically the financial services industry. Included in these issues are the wild short-term fluctuations we have been seeing in the markets, in part due to the ways that CEOs are compensated, how investment managers are compensated, and how those compensation systems influence behaviors and […]
Sterling Raskie, MSFS, CFP®, ChFC®
The latest in our Owner’s Manual series, A 401(k) Owner’s Manual, was published in January 2020 and is available on 
A Medicare Owner’s Manual, is updated with 2020 facts and figures. This manual is available on 
Social Security for the Suddenly Single can be found on Amazon at 
Sterling’s first book, Lose Weight Save Money, can be 
An IRA Owner’s Manual, 2nd Edition is available for purchase on Amazon. Click the link to choose the 
Jim’s book – A Social Security Owner’s Manual, is now available on Amazon. Click this link for the 
And if you’ve come here to learn about queuing waterfowl, I apologize for the confusion. You may want to discuss your question with Lester, my loyal watchduck and self-proclaimed “advisor’s advisor”.