Sound Advice

Gold Digging? As if there weren’t enough scams working their way through the media, the latest is a play on fears driven by the recent problems at Silicon Valley Bank and other financial institutions that have been mismanaged.   That’s what happens when banks bungle handling of their investments and fall short of available funds to meet their current obligations.   Folks will recall the banking crisis of 2008-9, which led to a market slide of over 38%, followed by a 10-year recovery with average annual gains of better than 18%. Here we go again?   Hardly, though there are certainly significant issues, one of which is the supposed guarantee of $250,000 for each depositor, which doesn’t exactly match up with banking problems in the tens or hundreds of millions.   So it appears that Washington is protecting the big guys as well as the little guys.   Something about that doesn’t seem quite right. Back to the scam, which warns people about the possibility that today’s banking problems

More Advisor Alphabet Soup One can only be amazed at the creativity of those who would be too happy to sell advisors even more letters to follow their names.   Those who are naïve probably figure that the more letters there are, the stronger the credentials of the advisor.   My sympathies to those who actually believe that.   Indeed, an easy rule of thumb to follow is that once the string gets past two sets of letters it’s probably an indication of someone to be avoided.   Yet, there are always those who will be happy to sell you a small part of the alphabet for a fee. Just recently, I received an email from the International Association of Registered Financial Consultants (IARFC), which claims to support “. . . the financial professional with a distinct Mission (capital M), a strong ethical code, and a recognition of your experience, education, and licensing through designations and an accredited credential.”   Wow, what a mouthful. For fees ranging between $200 and $600 (plus a

The Anatomy of a Financial Plan However essential it is to have a proper plan for one’s financial future, the truth is that most people don’t.   In many cases, they start giving serious thought to what lies ahead as they move into their 50s and 60s, yet by that time it may be too late to make needed adjustments to ensure the ability to continue in their hoped-for lifestyle. The basic elements of planning are simple: what you own, what you owe, what you are earning, and what you are spending.   Very straightforward.   Three of the four are relatively easy to pinpoint.   The tricky part is getting a handle on expenses.   Not only is it essential to zero in on current expenses, but spending needs to be viewed in three other contexts: retirement, one survivor, and that survivor in retirement.   Viewed from these different angles, the numbers change substantially. The current expense budget will probably include a couple of dozen categories, from essential (mortgage, utilities, etc.)