Special Needs Financial Planning

Picking the wrong niche is one of the worst decisions you could make for your practice.

In May the Congressional Budget office (CBO) updated its 10-year fiscal estimates for federal revenue, spending, and annual deficits through 2029. The CBO is a non partisan agency tasked with analyzing data to provide Congress estimates for GDP growth and the impact on government spending and revenue from changes in tax laws.

Over the last 18-months, there has been a continual drone of political punditry touting the success of “Trumponomics” as measured by various economic data points. Even the President himself has several times taken the opportunity to tweet about the “strongest economy ever.”

A situation that involves someone who may be mentally ill requires that advisors understand the degree to which those involved may have diminished capacity. Consider this example from my practice.

The disconnect between retirement confidence and preparation—and 3 simple ways advisors can make a difference.

Amazon, Google or someone else is going to disrupt the paper-mongering insurance industry.

Many factors are holding down inflation, U.S. jobs growth continues to surprise and China’s bad loans are getting worse.

Planning for a successful retirement is about much more than just an investment strategy that will provide you with sufficient assets to fund your desired lifestyle. It’s also about planning for a meaningful life in retirement.

The calendar is modest, with the big reports all hitting last week. Investors will never have more current information on the economy, the Fed, corporate earnings, and various risks than they do right now. It is difficult to guess what the punditry will do when given an open slate.

The US economy has a tendency to lag in the 1Q following big holiday spending, but not this year. While there have been widespread predictions that the economy was slowing down and the recovery might be ending, the latest GDP report put all that to rest.

What keeps your wheels spinning, generating new ideas and creating new solutions? What drives you forward? What is your “why?”

Q1 2019 proved to be the exact opposite of Q4 2018; it was the quarter where nearly everything worked. Virtually all asset classes produced positive returns, from U.S. and International equities of all sizes and sectors, to higher quality bonds and junk bonds, and, yes, even commodities floated with the rising tide.

Am I destined to work for people who think they know everything? Is that this business?

My career started in 1994, which was a stealth bear market for stocks and an outright bear market for bonds. Fed Chair Alan Greenspan hiked rates seven times as he played catch up in response to a percolating economy that rediscovered its sea legs coming off the 1991 recession.

The Health Services Sector is one of the smallest sectors as presented by FactSet as it only contains 137 companies out of more than 19,000 in the US and Canadian universe.

According to a 2016 Return on Disability Group report, over 56 million people in the United States identified themselves as having a disability. This demographic, along with their caretakers, requires specialized financial planning, but are often left underserved by their advisors.

I found more value in the Finance Sector than I did in any other sector that I screened. All in all, I identified 131 attractively valued companies out of the 1,888 companies in the Finance Sector.

2018 will be broadly remembered as a year when nothing worked and daily stock market volatility spiked. This contrasted with 2017 where seemingly everything pushed higher, and volatility was low. But in 2018, nearly every single asset class and all but one major stock market index (Brazil) around the globe posted negative returns.

When is it appropriate to commence a guardian proceeding? What do I have to prove? What concerns should I have about bringing a proceeding? Can it be avoided?

Let’s be clear. October’s market decline was a rather mild warning shot. At its lowest close, the S&P 500 lost -9.9% from its September peak, before rebounding in recent sessions. As I noted during the 2000-2002 and 2007-2009 collapses, intermittent “fast, furious, prone-to-failure” rebounds are among the factors that encourage investors to hold on through the entirety of major declines.

Advisors often receive clients’ advance directives, such as durable powers of attorney and health care proxies, that were drafted in a different state, perhaps many years ago. Are those still valid?

It is hard to say with certainty what drives trading on any particular day, but it doesn’t seem a stretch to say that over the past few months a combination of tariffs and Federal Reserve rate hike fears have broadly impacted both equity and fixed income markets.

To get CPAs to like you, there’s no more powerful tool than empathy. Here’s what is going on in the mind of the CPA when you approach them to be a source of referrals.

The music is fading out, and a trap-door has opened up in the floor, but they're still dancing. In recent days, the combination of extreme valuations and unfavorable market internals has been joined by acute dispersion in daily trading data that often occurs within a few days of pre-collapse peaks in the market.

For years, Adam Sharp has helped accredited and retail investors get in on the ground floor of some of the most promising early stage investment opportunities. These include not just venture capital but also equity crowdfunding and cryptocurrencies, which he added last year to his two research offerings, First Stage Investor and Crypto Asset Strategies.

We hired an HR person who turned out to be an irascible gossip. Team members are coming to me to complain. What should I do?

What we can learn about the current state of our economy by traveling and visiting with others outside of our home turf is amazing. For many of us in the investment business, our view of the economy is easily warped by statistical reports and interpretations prepared by professional economists.

For much of this recovery and expansion, many have opined that this economic cycle would ultimately end very differently than those of the past. We have resisted this narrative and instead explained our belief that this cycle will indeed follow the same path and end like all others.

The US labor market is going from strength to strength. Like with corporate earnings, June jobs data beat consensus estimates - up 213,000 - pushing the average monthly gain for the past year to 198,000 per month.

Life-cycle economics contributes two foundational concepts to financial planning. The first is that individuals and couples must accumulate savings during their working years to support themselves in retirement. The second is consumption smoothing – clients prefer to maintain a steady standard of living over the full cycle of accumulation and decumulation.

Harold Evensky's most recent NewsLetter.

Each year, Social Security’s Trustees report to Congress on the financial status of the program. This typically generates a number of anxiety-provoking media headlines about if/when it will run out of money. Gail Buckner, CFP, our personal retirement and financial planning strategist, takes a look at the facts. She says Social Security is actually in pretty good shape overall.

Once each year, the Trustees of the Social Security and Medicare trust funds are required to provide a detailed status report to Congress, including financial projections well into the future. The latest reports were provided to Congress last week. There was good news and bad news, as usual.

In over thirty years of watching the economy we've seen recessions, recoveries (both slow and fast), panics, lulls, and boomlets. But we've rarely seen a job market this strong.

The US labor market has rarely been stronger. Recent figures from the Labor Department show US businesses had a total of 6.550 million job openings in March versus 6.585 million people who were unemployed. That's a gap of only 35,000 workers.

Today we’re going to look at how Washington spends our tax dollars. Specifically, we’ll look at a new report which shows how the federal government spends the income tax paid by the average family – and how they spend even more than what’s collected to create massive budget deficits year after year after year.

Here are some issues senior LGBTQ clients face and how you can help them.

In many respects, economists are a little unusual. We think in odd ways, and we arrange data into odd patterns. We find it hard to reach conclusions without significant equivocation.

David Lau is the founder and CEO of DPL Financial Partners, a firm focused on the distribution of commission-free insurance products geared toward the RIA and fee-based advisor channel. In this interview, he discusses his suite of products and related services.

Federal Reserve officials like to say their policy course is “data-dependent.” That sounds very cautious and intelligent, but what does it actually mean? Which data and who’s interpreting it? Let’s ask a few questions.

The most significant economic news of late was last Friday’s disappointing report on 4Q Gross Domestic Product which came in at only 2.6% (annual rate) versus the pre-report consensus of 3.0%.

If you lapse into a lecture about the overwhelming evidence supporting passive investments, remember you might as well be showing the prospect an article about bird feeding.

The combined tax reform proposal includes plans to lower tax rates on individuals and businesses and change many deductions. Those hoping for tax simplification, however, may be disappointed. Here’s a thorough but concise summary of the plan.

On December 2, Senate Republicans managed to obtain enough votes to pass sweeping US tax reform legislation, but with several changes compared with the original House of Representatives' bill. At more than 470 pages, the "Tax Cuts and Jobs Act" is certainly not a light read. But, it has some important implications for individuals and corporations, for better or worse in some cases.

Today I’ll give you some quick thoughts on the just-issued November jobs report, then take a deeper look at the automation problem/opportunity.

When you write about economics, you learn very quickly that the economy doesn’t care what you say about it. The forces that drive it are beyond any one person’s comprehension, much less control. But at the same time, the economy doesn’t work like a law of nature. Unlike gravity, for instance, the economy responds to human choices and preferences. We influence it, even if we don’t understand exactly how.

Can I run my sole-practitioner firm for the next 15 years until I retire? I write because my wife keeps bugging me to “hire someone to help” and I am dragging my feet to do this. She thinks it will free me up, but I believe it will tie me down in ways I don’t desire.

You routinely engage in some practices that on the surface make sense. But you would gather more assets if you discarded them. Here are three examples.

Supply and demand theories suggest worker scarcity would increase the price paid for labor. This has certainly been the case during recent American expansions, when annual wage gains topped 4%.

Can 529 funds be used for gap-year expenses? I recently had a parent ask me if their child’s 529 college savings account money could be used to help pay for gap-year expenses. Here’s the short answer: Maybe.

If you’re like many working Americans, you may be concerned about the state of Social Security and whether it will be there for you when you retire. Gail Buckner, CFP, our personal retirement and financial planning strategist, explores some myths about Social Security and eases some concerns about its future.

Every year the Trustees of the US Social Security and Medicare trust funds provide their report on the current and projected financial status of these programs.

The pace of job growth has slowed, but it’s likely not because the economy is weakening. It may even be because the economy is strengthening.

The international markets have lower valuations, improving growth and possibly even more political certainty than here in the U.S. Foreign currencies are rising against the U.S. dollar as economic trade flows shift and investors want to diversify away from the United States. It is getting increasingly more difficult to make business and investment decisions with Washington D.C. policy proposals and reactions being so fluid. CEOs are confused, foreign leaders are confused and even I am confused whether buying an American made car without the Ford or GM logo on it is still a pro-American purchase.

Have we all gone lazy? Are Americans no longer the restless go-getters they once were? Has our culture changed in ways that impede economic progress instead of naturally promoting it? In his new book, The Complacent Class, Tyler Cowen, one of the most eclectic and inventive authors on economic issues, says yes to all of these questions.

The middle class is a fairly new development in economics. Up until the last century or two, most societies had a tiny wealthy elite and great masses of common laborers. We now regard having this group in the middle, not wealthy but with their own assets and spending power, as a great achievement. We don’t want to lose it, but some people fear we will.

Donald Trump swept into office on a populist wave. His promise of greater growth for the United States economy resonated with a large part of those disappointed with stagnant wages and a lack of opportunity. He said he would bring manufacturing jobs back and provide better healthcare coverage at a lower cost.

This week we begin a series of letters exploring the new economic and sociological anxiety. I want to look at what causes it and think about what we can do to ease it. I don’t know how many letters this dive will take. I may break away for other topics and then come back to the topic of angst. 

Today’s U.S. labor market report solidified market expectations that the Federal Reserve will raise the fed funds rate by 25 basis points at its two-day meeting next week.

If you're like most working people, you've probably received a statement in the mail from the Social Security Administration listing your potential future benefits. Trying to figure out how Social Security arrived at those mysterious figures requires some detective work. Here, Gail Buckner, CFP, our personal retirement and financial planning strategist, attempts to crack the code. She discusses how your benefit is calculated and offers some strategies on how to maximize it.

With his widely followed, and positively reviewed, address to Congress last week, President Trump showed how easy it could be to unite Washington around a big-budget centrist agenda on health care, immigration, taxes, infrastructure and the military.

Today, patient reader, we hopefully reach the end of our tax reform saga, which has grown much longer than I expected. I seriously thought at the beginning that I could fit all this into one letter. Then it became a two-parter, then a trilogy, and then … well, here we are.

This letter turns out to be the penultimate installment in my now five-part series on tax reform.

With student loan debt on the rise, it is important to understand different options for funding education costs over the short or long term. Opening and contributing to a 529 college savings plan offers many benefits such as tax-free growth and higher returns, compared to many traditional savings options.

Advisory firms face a daunting challenge as they prepare themselves for the latest version of the future. They will have to retool their service offering for a new generation of clients (aka Millennials), who have very different preferences, different advice needs and far more digital sophistication than your Baby Boomer clients ever had.