When I was a child the only television my father ever watched, and I with him, was the Jackie Gleason Show. Mostly I think he loved the dancing girls. Later in my teens he faced some difficult times and, probably for distraction, began to channel surf (which in those days provided a measure of exercise given the need to get up from one’s seat in order to change stations). Often at the end of a movie he would, sounding disappointed in himself, press the off button with vehemence and pronounce to no one in particular what a senseless waste of his time it had been.
Read MoreI recently met with a client and, as usual, we reviewed the amount of money she withdraws each year from her portfolio. Because she is retired, we want to make sure she doesn’t spend down her assets too quickly. By “too quickly” I mean that she should have some money left at age 95. (At this point most clients tell me “Oh I won’t live to be 95” to which I reply “Well you could! And if you do you don’t want to be destitute!”) As we were talking about the things she likes to spend her money on she mentioned a friend who goes to Florida every winter. “You know” she said wistfully, “she’s richer than I am.” “How do you know?” I asked. “Because I see how she lives” replied my client. My answer to that was, “the way someone lives is not always an indica-tion of their wealth” which led to a discussion about over-spending. As a financial planner I have all too often sat with clients whose lifestyle was way beyond their means.
Read MoreEarly in our business when clients would ask about investing in a way that is kind to the environment, or avoids companies that build weapons or treats their employees unfairly, our simple and stock response was that these types of investments generally under-perform the broader market. And that would be the end of the conversation. How this whole issue of Sustainable and Responsible Investing (SRI) dropped off the radar of this writer, a financial planner who strives to live in a way that is gentle to our planet and to the animals and people who populate it is a mystery. Perhaps I was pre-occupied with running a business; perhaps I subconsciously continued to dismiss SRI as a viable option to help clients meet their goals. But it hit me in the face when recently I presented a portfolio design to a new client who looked aghast at the underlying companies within the mutual funds being recommended – chemical companies, frackers, weapons suppliers, agribusiness, tobacco , etc. – and declared they couldn’t’ possibly support these types of investments regardless of return. Zing!
Read MoreThere has been a lot of news lately about the increasing use of bitcoins, a new form of digital currency. Most of us never heard of them before this year, but they have been around since 2009 when they were created by an unknown person known as “Satoshi Nakamoto.” The currency doesn’t exist physically and there are no banks that hold them. They are stored in a digital wallet on the cloud, or on your computer. There are several exchanges where you can buy them, or you can acquire them by selling a good or service in exchange for bitcoin.
Read MoreAs noted in the past, at Cornerstone we get to take our birthday off. Last year at this time I wrote about my trip to Mackworth Island and how good it was to go solo, to walk and sit by the sea, to slow down for a short period and simply just be. I decided this may be a good annual event and was undeterred when heading back this June despite the gray and gusty rain-sprinkled day. A person can sit and think in all types of weather!
Read More“Happiness is neither virtue nor pleasure nor this thing nor that but simply growth; we are happy when we are growing.”
I’ve always appreciated this quote by William Bulter Yeats and long associated growth with learning. I bought a set of World Book encyclopedias when I graduated from high school and remember opening the books at random. I rebuilt the engine of my ’67 Cougar with my not-yet husband. Yes, learning equals growth equals happiness. But is growth always good?
Read MoreAn ironic outcome of the financial crisis of 2008 is that, while interest rates are at historic lows, refinancing or obtaining a mortgage is more difficult than ever. Recently several of our clients experienced trouble while trying to refinance their existing mortgages. Either the bank wanted information that proved difficult for the client to provide (proof that a company pension would continue at least 10 years) or the process took so long that the client got frustrated and walked away. These experiences are not unusual, according to several mortgage lenders I have spoken with recently. Because of all the bad loans out there, banks are being very stringent with their requirements. They want to be sure that any loan they approve will pass FHA inspection (so they can sell it to the FHA and get if off their books) or is strong enough to keep on their books. On the whole this is a good thing – those “no income” loans of old are gone for good, we hope. But it is making life harder for even those with good credit histories and steady income.
Read MoreThere is no perfect equation that establishes the price of a stock, unfortunately. In the marketplace of buyers and sellers this figure is based on supply and demand; an increase in demand for a stock puts upward pressure on its price and a decrease in demand creates an over-supply and pushes the price of a stock down. Beyond this, there are 3 basic areas that come into play: Fundamental factors, technical factors and market sentiment.
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