March 2011 Newsletter
Business Spotlight - Yola’s Cafe
Looking for a nice quiet place to meet with family, friends, or business associates? Look no further! Yola’s is one of Madison’s best kept secrets. Learn more here!
Financial Gurus
In this month’s Commercial Spotlight Newsletter we feature three different financial planners and their unique perspectives. Everyone can use sound financial advice and these are three options that you may want to consider. Questions and answers below!
Nathan Brinkman, Triumph Wealth Management
Michael Kock, Kock Financial
Jason Sanger, Wisconsin Financial Group
Nathan Brinkman
Triumph Wealth Management, LLC
e: nbrinkman@finsvcs.com
p: (608) 828-4338
1. What are the biggest things happening in the markets and financial planning industry right now?
There are so many current moving parts it is hard to pin one thing down. With the current tragedy in Japan, increases in fuel prices, increases in agricultural commodities (food prices), impending inflation and sweeping tax law changes there is plenty of information for us to digest. In the markets we deal with the here and now, in financial planning we try to determine how the here and now affects next month, next year and the years to come.
2. What advice do you have for potential clients when they are seeking a financial planner?
Interview a few. Work with someone you feel you can trust. Make sure they independently review your situation and are not product focused.
3. What are the most important goals people and families should have in their financial plan?
Every situation is different and unique. I think one of the biggest problems in financial planning is helping people truly identify what their goals and dreams are. So many of us think we want to follow in the footsteps of our friends and family. Most of us wouldn’t be happy with identical results.
4. What is the most important thing all people should do, right now, when it comes to financial planning?
My experience has taught me people spend more time planning for a vacation than their financial affairs. The most important thing people can do is take some time to evaluate their current position and determine what needs to change. The next trick is to implement the changes. This time of year is a great time to do a review.
Michael Kock
Kock Financial
e: michael@kockfinancial.com
p: (608) 270-9030
1. What are new developments or issues that have arisen in the financial planning industry and markets lately?
Probably the biggest development lately is the extension of the Bush tax cuts. What most people are not aware of is that the Federal Estate Tax exemption is now $5,000,000…however the Lifetime Gift Tax Exemption was raised from $1,000,000 to $5,000,000 now. That could allow for much more flexibility in clients being able to transfer wealth without gift tax consequences in the future. Market update, is one of perspective. If you look at the markets from a fundamental viewpoint, they look historically cheap even the increase that we’ve had in the markets. Corporations are being some of the most profitable in the past 50 years, they’re sitting on historically high cash positions, while valuations are still at very, very low numbers, and productivity is very, very high. If you look at the market from a technical trading aspect…which carries a shorter time horizon and viewpoint…it’s quite expensive. 52 week highs vs 52 week lows, 200 day moving averages, etc., all look expensive. Seems as confidence is coming back into the market and that the fundamental viewpoint is winning thus far.
2. What advice do you have for potential clients whey they are seeking a financial planner?
First…your planner needs to be objective and have the CLIENT’S bests interests as his primary objective. Second, is how your planner approaches the topic. Too many investment representatives want to sell you ‘carpeting and paint’ and jam that into a ‘financial house’. We strive to build your ‘house’ first…then go out and find the proper tools and investment vehicles that fit your needs. Being independent helps us accomplish that objectively. I think it’s in the client’s best interests to have their planner disclose their fees and revenues as well and set a fee structure that’s conducive to the client. It could be fee based, asset management based, commission based or a combination. Bottom line…the planner has to provide VALUE and trust. If he/she doesn’t, follow the green line and see how it works out.
3. What are the most important goals people and families should have in their financial plan?
Quite easy.
One…don’t spend more than you make.
Two…save and save wisely.
It’s amazingly that simple. The way you save and all the different investment opportunities is where an advisor can really help. I’m learning every day. The investment landscape is constantly changing…so you have to be up to speed and be able to adapt. Two of the most respected institutions in the world years ago…GM and Fannie Mae…went basically bankrupt. Turning a blind eye to your situation can be dangerous and irreversible if you’re not careful.
4. What is the most important thing all people should do, right now, when it comes to financial planning?
Follow answer to question #3. And if you can’t handle this issue yourself, find someone you can trust who you think has your best interests in mind that you can develop a long standing relationship with to help you with your finances.
Michael Kock CFP (TM), CLU, ChFC is the owner of Kock Financial. Securities offered through First Heartland Capital, Inc. Member FINRA & SIPC. Advisory services offered through First Heartland Consultants, Inc. Kock Financial is not affiliated with First Heartland Capital, Inc.
Jason Sanger
Wisconsin Financial Group, Inc.
e: jasonsanger@wisconsinfinancial.com
p: (608) 274-9110
1. What are the biggest things happening in the markets and financial planning industry right now?
There is a large portion of the population (the baby boomer generation) that is starting to retire or within 10 years of retirement. Many people are now realizing that they have to start positioning their assets appropriately to get the best retirement income streams. In essence, they are preparing for the switch from accumulating money to distributing money for retirement income.
2. What advice do you have for potential clients when they are seeking a financial planner? Come see us!!! Okay, if that’s not appropriate then use this: Since we all only have a finite amount of money to work with, every financial decision we make affects every other one. Therefore, the financial decisions we make for things like retirement and college savings shouldn’t be looked at as separate events. In fact, you can lose a lot of money by doing it this way. When seeking a financial planner, be sure they understand the big picture relationships that exist between these types of decisions, they are not separate.
3. What are the most important goals people and families should have in their financial plan?
Proper protection, annual savings, and efficient allocation of their annual savings. When deciding how to efficiently allocate annual savings, it is imperative to understand the options for using the money later, as this often economically defines where to allocate savings today. For example, many people are saving for retirement, but haven’t taken the time to understand how retirement income streams work. If you begin with the end in mind, it becomes clear as to what vehicles need to be there down the road to maximize results. If you were going to climb Mt. Everest, would getting to the top of the mountain be the goal, or would getting to the top and then making it back down safely really be the goal? This is a metaphor for people’s financial lives…. What it takes to make it back down the mountain in retirement is what defines what we have to be doing today when we’re climbing the mountain in pre-retirement?
4. What is the most important thing all people should do, right now, when it comes to financial planning?
Make the time to do it. Time is one of the most valuable assets people have to work with, get started as soon as possible. If you never start setting money aside, you will never be better than your ability to earn an income.
