It’s my belief the volatility we’ve seen in the past few weeks, months, and year will continue going forward. I also believe that more active management may make sense to take advantage of this market condition.
I talk about this in my video.
I also discuss the rising healthcare costs in your future and that I have software that will estimate what lump sum you may need upon retirement to fund your healthcare under certain assumptions.
Fun stuff! Click on video to hear more!
TRANSCRIPT:
Hi there, Mike Brady with Generosity Wealth Management, here in Boulder, Colorado. And I am really pleased to be talking with you today and there are a couple of things I want to talk about today.
And the first one is volatility. On Wednesday, we had a DOW that was over 400 points up, and this is following the Thanksgiving week where the market was sharply down. (Low volume but still sharply down.) And it’s my belief that this type of volatility, and not just in the last couple of weeks, we’ve seen a lot of volatility in the last year or so, I believe it is going to continue going forward. And if that is true, it’s also my belief that some active management should be considered for client’s portfolio. That’s something that I’m going to be talking with my clients about in the coming months. That’s also something I’m going to be talking about in these videos in the coming months, that it may have a place in a volatile environment- how can we best position our portfolio to take advantage of that particular market condition? So, if you’re not one of my clients, I recommend you give me a call so that we can talk about it, kind of one on one, and your personal situation.
And the second thing I’m thinking about this week is well, healthcare costs; and specifically as it relates to retirement.
I heard a statistic yesterday that is very interesting. The Fortune 100, 91 out of the Fortune 100, in 1985, had traditional pension plans. Today, the Fortune 100, only 19 of them have traditional pension plans. If you’re a GE employee, starting today, you know, day one of your employment, you are not offered their traditional pension plan. And that is, GE is one of the largest companies, with the largest pension plans. So, I think this is a trend that is going to continue going forward. And what this tells us is that you’ve got to take control of your saving and investing for your own retirement. Don’t assume that someone else, either some big corporation or even Social Security is going to handle it. You’ve got to take control of it!
And one of the largest expenses you’re going to have in retirement are your health care costs. And fifty-three per cent of individuals recently polled couldn’t even estimate what those health care costs are. We’re talking Medicare A, and B, and D, and your estimated premium payments, and your estimated out of pocket expenses. These are some expenses that you’re going to have to, you know, pay in your retirement. So the question is, in your life expectancy, what are they going to be, what kind of a lump sum, under certain assumptions, will you need to have in retirement? And of course the question is- do you have that set aside? You may, you may not, but let’s try to quantify that on a piece of paper.
I have some wonderful software that I’m going to be working with clients with in the next couple of months to try to put that number down on a piece of paper so that we can say, “Boom! This amount of money is what, under these assumptions, we’re going to need for the healthcare costs for the rest of your life.” So the question is, have you done that for yourself? Maybe you have. If you haven’t, give me a call I can try to help you answer that question. It’s a hard number to really put down, things are always in motion, but you know what, let’s try to estimate as best we can. An estimate is better than not having any idea at all. And it is something we can revise as the years go forward.
So anyway, that’s kind of what’s on my mind this week. Mike Brady, Generosity Wealth Management, 303.747.6455, here in Boulder, Colorado. A comprehensive, a full service wealth management firm; I love my clients, I have a great passion to treat my clients like members of my family, and if you’re not my client, I’d love to talk to you about whether it makes sense if what I do is right for you, or if I’m the right person to help you with that. So, anyway, you have a wonderful week and we’ll talk to you later bye bye now.
Europe has been, and will continue to be, the news event going forward. The effect it has upon the US is irritatingly large, whether we like it or not.
As I’ve stated in previous newsletters, the European Monetary Union (Euro) will have to change drastically for Europe to weather their problems. There will also be some drastic, fundamental ways the relationship between state and citizens will change.
The question is: what does this mean for your investments?
1. I continue to caution against all things Europe
2. Constantly evaluate the allocation of your investments to ensure they’re meeting your risk levels
3. Consider more active management in the coming year. Talk to me about what this might mean.
As a complement to some of the volatility I discuss in my video, you can see in the chart to the left that what goes up one month can go down the next.
What an interesting month! Who would have thought it would turn out to be such a good month just a short 3 to 4 weeks ago? Many people actually, if you seek out alternative voices to that which you see in the daily paper or newscast. I talk about this in this week’s video below.
Also, I talk about how you should assess the level of communication in the past 2 to 3 months from your adviser. Did you hear from him/her? You sure as heck should have.
Lastly, now is a great time to get back to basics.
Click on video to hear more.
GWM- Video Transcript- 28 October 2011- Information, Communication, Basics
Hi there, Mike Brady with Generosity Wealth Management, here in Boulder, Colorado. It’s been a few weeks since I’ve done a video and sent a newsletter out. But my last video was about fifteen or sixteen minutes, and that was pretty long compared to my previous ones but I had a quarterly review and lots happening in the third quarter.
Today I’m thinking about two or three different things; the first one is information, the second is communication and the third is kind of getting back to basics.
Let me tell you what I mean by that; information. Three, four weeks ago, let’s not kid each other, you could not open up a newspaper or a magazine or watch, you know, some nightly news telecast without it all being negative. “If it bleeds, it leads.” And one of the responsibilities, I believe, of an investor and your financial advisor is not to get into a bunch of group think. I remember back in 1999, early 2000, when the internet boom was going on, if you poopa’ed any kind of an internet stock or tech company- you were just like “old thinking.” I remember Warren Buffet back in in 1998, 1999, was at a big conference of some type and yeah, there were all these internet people saying “oh God, he’s old thinking” “he needs to get with the new economy.” And, you know what, that took courage on his part, (of course he had a few billion behind him) to say “listen, I believe that your analysis is incorrect.”
Well frankly, three or four weeks ago everyone was saying the market stinks and the economy stinks, and there’s no way that it can go but down. And, that’s just not the case. I’m glad that the last quarter, excuse me, the last month has been a good month. Do I know exactly where it’s going to go-if it’s going to continue on its upward trend, is it going to reverse and go back to the down? No, I don’t. But I say that very humbly. And I watch things very closely. And I’m going to continue to have the right percentages.
I am going to next week, (assuming nothing major happens), in the next week or so, I’m going to do a video that I did about two or three months ago on information and confidence in your information. I did the video, and then so much stuff was happening in the month of August that I kind of had to put it in the can, I had to kind of put it to the side. But I want to do that because it is so relevant. I just listened to it before turning on this video, my camera here and I think it’s great and I’m very excited to share that with you.
Second thing is communication. A financial advisor sure as heck should reach out to clients and sure as heck should have been communicating with you. Because if you only hear from a financial advisor when things are going well, that’s a problem- in my opinion. You pay a financial advisor to help you, to set up a plan to hold your hand, you know sometimes, in the difficult times.
If you’re my client, you know that I gave you a call; that I reached out to you and that you’ve always got these videos and blogs and newsletters.
The last thing that I want to talk about is getting back to the basics. You know, I’ve always talked about estate planning, and tax planning, retirement planning. These are absolutely the core, essential pieces of what you should be doing for yourself. The market is going to go up, and it is going to go down, OK? I’m just telling you that. Up, down, sideways, three ways the market goes. And reassess for yourself how you felt this last quarter, and did you completely want to go off and completely change everything? No! (Hopefully not.) You need to have a plan, yes it needs to be modified accordingly, but hopefully you’re in partnership with somebody who will help tell you when “wow, we need to radically change this,” or only minimally change it, or maybe do nothing. That is proactively doing nothing is still doing something, OK? And so make sure that you get back to the basics; is your portfolio in line with what your risk level is? I think that’s absolutely essential and that’s some of the best advice that you can get.
Now I believe going forward that we’re going to have, so maybe I’m thinking of four things (!), I think we’re going to have some volatile markets and this is an opportunity for some tactical allocation, some dynamic asset allocation. So one of the things that I’m going to be talking about in the next quarter or so, for clients, is how that plays into your portfolio.
I think there are certain markets where this is… where having a more actively managed portfolio makes sense. And I think going forward that is going to be the situation because we’re having various trading ranges, increased volatility and lots of range trading and ex cetera.
So, anyway those are some of my thoughts. I guess it’s not quite as short a video as I thought. Sorry about that. But well, you could have hit pause at any time during this video!
Anyway, Mike Brady, Generosity Wealth Management, 303.747.6455. I would love to hear from you. If you’re my client I absolutely love you. If you’re not my client, I like you, but I’d love to get to love you. So please give me a call, or an e-mail; mike@generositywealth.com.
But anyway, you have a wonderful, wonderful day and a wonderful week, and we’ll talk to you later bye bye now.
