Bonding With Your Portfolio

Nearly all investors realize the importance of diversification to the investment process. Many may not be as familiar with the importance of asset allocation— dividing your portfolio into the appropriate mix of stocks, bonds, and cash. Although assets can also include real estate (homes, vacation homes, and rental properties) or business ownership, the most widely held asset classes are stock, bonds, and cash. In a strong economic climate, the potential for gain when stocks perform well opens up. Typically, most people who invest in the stock market also see value in having a liquid cash reserve set aside for emergencies and larger expenditures. But, what about bonds? Are they affected by economic swings and what are the risks involved? There is interest rate risk associated with investing in a bond or bond mutual fund, referred to as an inverse relationship. This means that as interest rates rise, generally, prices of …

CONTINUE READING

Will Net Neutrality Impact Financial Planning?

Will Net Neutrality Impact Financial Planning? Perspectives from a Financial Advisor: You’re probably tired of hearing about, talking about and thinking about Net Neutrality. And I suspect your opinions on this topic are along ideological lines. But from my perspective as a financial advisor, the idea of repealing Net Neutrality is worrisome. Let me explain. As most know, “Net Neutrality” is the basic principle that prohibits internet service providers (like AT&T, Comcast or Verizon) from slowing down, speeding up or completely blocking content, websites or web-based applications you and I want to use. Let’s Ignore the Free Speech Issue for a Second I don’t want to get into a divisive discussion about whether Net Neutrality enables and protects free speech. Nor do I want to debate how much Net Neutrality will devastate certain communities that cannot afford to pay. And I don’t want to get into an argument about whether …

CONTINUE READING

Things All Financial Advisors Should Keep In Mind

Money management can seem pretty straightforward — customers set goals, and financial advisors help them meet those goals. But things aren’t always so simple. Emotions, family situations and the client’s financial standing can pose challenges for financial advisors if they’re not prepared. “Every individual is unique, and makes decisions about investing and wealth management influenced by their emotional makeup,” says wealth management adviser Chris White. “Financial advisors need to understand the emotional factors that drive their clients’ behavior, and their attitudes about risk-taking and money management. If they do, they will be better able to fashion wealth management plans that are suited to an individual client’s personality, temperament and risk-tolerance.” Here are some things to keep in mind. Plan for a Solo Life, as Well as Marriage Married couples who start financial planning generally don’t give any consideration to the chance of divorce, even as a remote contingency, says registered …

CONTINUE READING

Don’t Miss These Year-End Retirement-Planning Deadlines

It’s not too late to ensure that your retirement planning is on track to maximize tax savings before the end of 2017. Understanding end-of-year deadlines can help you maximize your tax savings as well as prepare for another year of saving. “Tax planning should really start in January, not in November or December,” says Randall Luebke, a financial planner at Lifetime Paradigm. “That said, if you do wait, be sure to do everything you can to reduce the taxes you pay.” Now is the time to accelerate your tax-deductible expenses and put off receiving taxable income. Here are some tips. Consider Roth Accounts If you’ve been thinking about converting a traditional IRA to a Roth IRA, it’s a good time to make a decision and act because you must file forms by the end of the year. With Dec. 31 falling on a Sunday in 2017, experts recommend aiming for …

CONTINUE READING

Big Data Trends in the Financial Industry

Big Data Trends in the Financial Industry

Banks, brokerages and other financial institutions are all looking for ways to put big data to work these days. According to a study by the IBM Institute for Business Value, more than 70% of financial companies that use big data analytics say it creates a competitive advantage for their organization.   Financial organizations tend to have a lot of data, and mining that data can help them find a way to maintain their edge with customers. “The key is making sure you use big data for what it is, a signal of how people have responded to a set of past circumstances,” says Eric Nalbone, head of performance marketing for Kabbage, which provides funding to small businesses. Here’s a look at the biggest trends in how financial firms are using big data in their organizations. Applying It to Risk Management Financial institutions and companies that want to protect themselves and …

CONTINUE READING