Happy new year and hello to the January Effect. Will January be a great month for stocks compared to other months of the year as many people hypothesize? Can it really be that easy to overweight stocks in January and get extra returns? CNBC reported a couple days ago that since 1980 January has been only the 5th best month of the year on average. And since the year 2000 it has been below average. Ok, what's the next lazy shortcut we should look for?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Wednesday, December 31, 2014
Friday, December 26, 2014
Being smart with $$ -- Data Mining
Data mining---the process of looking at large amounts of historical data and finding patterns. But are historical patterns meaningful for predicting future results? For example, Wednesdays have historically been the best days of the week for stocks. But in the absence of an exact 5-way tie, one out of the five weekdays has to have been the best day. CNBC said that the last five trading days of the year are historically superior to other five day periods by about 1%. Is this data mining? We have three days left to see how it works out this year.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Tuesday, December 23, 2014
Being smart with $$ -- Catching a falling knife
Falling knives? People say we shouldn't catch them. In the financial markets,
investors often love to buy an asset after it has fallen but many times the
buyer jumps in only to see it continue to fall. Recently oil has fallen by
almost a half. T. Boone Pickens said today on CNBC that Brent oil should rise by
50% or more in the next year to year and a half. Will it? We will only know in
18 months but in the meantime you might want to wear some steel-plated
gloves.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Friday, December 19, 2014
Being smart with $$ -- Home prices rise but don't spend that equity
Home values are up again this year! Zillow says the value of all U.S. homes rose
by 6.7%. So now are you planning to do a cash-out refi and spend that extra equity
on a vacation or big screen TV?
Stop! Don't spend that
money. Why can't we do what our parents
did and retire on all that built-up equity?
- Bookmark my Blog:
www.clientpriority.blogspot.comThursday, December 18, 2014
Being smart with $$ -- Oil and emerging markets
Oil is down again.
Russia, Venezuela and other big producers are feeling the pain. The S&P 500 index of U.S. stocks is up 9%
year to date while emerging markets are down 9%. So should we sell our emerging markets funds
now? Only a crystal ball can tell you
that. The collective wisdom of all stock
market investors says emerging markets stocks are priced fairly to reflect
their problems. They may go up or down
from here in the near term but if you have a well-diversified portfolio, any
one holding should not hurt you much and when it starts growing you will be
glad you didn't sell.
Tuesday, December 16, 2014
Being smart with $$ -- Fund managers mess up your allocation
Fund managers are nervous about falling oil prices. So they now have 5% of their money in cash
instead of what you are paying them to invest in (says a Bank of America
Merrill Lynch survey as reported on CNBC.)
If asset prices fall you will be glad they aren't fully invested. However, if prices rise from here, you will
be angry at your poor results vs. an index fund. The problem is that YOU have chosen your
allocation to each asset class and when the fund manager is not investing
according to his/her mandate, your portfolio allocation is now off.- Larry
Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
- www.clientpriority.com
Saturday, December 13, 2014
Being smart with $$ -- Early December 2014 posts
December 12, 2014
Are you getting a raise?
Many people think so with consumer sentiment reported up today (says
Thomson Reuters/U of Michigan). This is
the best time to boost savings for your goals.
If you're getting a raise from, say, $75k to $77k and you boost your 401(k)
automatic withdrawal from 10% to 11%, you'll save about $1000 more per
year. This boost alone over 25 years
might give you an extra $60k when you retire.
Boost savings in a similar way with every year's raise and you probably
add over a half million dollars. That's
an EXTRA half million. And after taxes,
that's less half of your raise.
December 11, 2014
Women save more for retirement than men says a Vanguard
study. A higher percentage of women save
in their 401(k) and those women also save a higher percentage of their pay than
men do. C'mon guys! Step it up and do
your share! Tell HR you want your
numbers raised for 2015. The limits next year go up to $18,000 (and up to
$24,000 if you are 50 or older.)
December 8, 2014
Do Christmas and Hanukah presents make us happy?
Probably. But do we need to spend $300
on each child? Or would our kids be
happier over their lifetime if they got $100 in gifts from mom and dad and had
an extra $200 put into their college accounts? After 18 years in the stock
market, that difference could boost your college fund by $7 grand. With average student loan debt now around
$29k at graduation, that $7k would make a big difference in launching your
child into a more financially stable life.
December 3, 2014
Gas prices are low. Remember a while back when gas prices fell dramatically and the news reported that SUV sales were way up because it would be cheap to fill those enormous gas tanks? And remember how gas prices very quickly went right back up to high levels? Those buyers made the classic mistake of making long-term decisions (buying a car) based on short-term data that can change in a heartbeat. Will that happen again or will those old buyers just dust off the big car they tucked away the last time when they could no longer afford to drive it?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Gas prices are low. Remember a while back when gas prices fell dramatically and the news reported that SUV sales were way up because it would be cheap to fill those enormous gas tanks? And remember how gas prices very quickly went right back up to high levels? Those buyers made the classic mistake of making long-term decisions (buying a car) based on short-term data that can change in a heartbeat. Will that happen again or will those old buyers just dust off the big car they tucked away the last time when they could no longer afford to drive it?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- Late November 2014 posts
November 26, 2014
Giving thanks to your investment advisor? If you were simply 2/3 in stocks and 1/3 in
bonds you would have earned about 8.5% so far this year. Everybody's circumstances are different but go
ahead and thank your advisor as long as he or she helped you earn the return
you deserve. And make sure that's your return after his/her
fees. Your advisor shouldn't be making
more on your money than you are.
November 25, 2014
Black Friday and Cyber Monday. Two excuses to buy things you wouldn't
otherwise buy. Remember that saving $10 a day from graduation to retirement,
invested properly, can be worth $1 Million in your IRA. Spending $300 on a television you wouldn't
otherwise buy is 30 days worth of savings. But if you've been staring at the
blank screen of a broken TV, waiting for the chance to buy a new one, go for
it!
November 19, 2014
The stock market (S&P 500) is up 11% year-to-date despite all the turmoil. 11%! Remember how I've said that if you saved $10 a day from graduation to retirement and invested it in the stock market you might have $1 million when you retire? Well, if you could get 11% returns every year, your savings would grow to over $3.5 million! I don't know about you but I think I could retire on that.
The stock market (S&P 500) is up 11% year-to-date despite all the turmoil. 11%! Remember how I've said that if you saved $10 a day from graduation to retirement and invested it in the stock market you might have $1 million when you retire? Well, if you could get 11% returns every year, your savings would grow to over $3.5 million! I don't know about you but I think I could retire on that.
November 17, 2014
Skilled stock pickers or a simple unmanaged index fund? CNBC has 7 traders picking their 5 favorite
stocks each to see who can perform the best.
This started at the beginning of 2014 and they can make changes along
the way. So far they have a collective year-to-date return of 7.4%. Not bad.
After all, it should be easy to pick just 5 good stocks, right? Well, if you just bought the Vanguard Total
Stock Market Index Fund instead, you would have a 9.6% return. That extra 2.2% return adds up. Over 20 years
it would give you 50% more money!
- Larry Pike, CFA, Client Priority Financial Advisors LLC- www.clientpriority.com
Being smart with $$ -- Early November 2014 posts
November 14, 2014
Are you paying your investment advisor 1% of your assets every year? Or even more? Is this costing you thousands of dollars per year? Ask me about a sensible alternative. I offer a free consultation to discuss a different approach. Each month you delay can be costing you hundreds of dollars that you could be saving for retirement.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Are you paying your investment advisor 1% of your assets every year? Or even more? Is this costing you thousands of dollars per year? Ask me about a sensible alternative. I offer a free consultation to discuss a different approach. Each month you delay can be costing you hundreds of dollars that you could be saving for retirement.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
November 12, 2014
Hedge funds? Wish you could invest? Warren Buffett made a bet that over 10 years a low-cost S&P 500 stock fund would beat a portfolio of hedge funds. A little more than halfway into the bet, Buffet's choice is ahead by a huge amount. Hedge funds usually collect fees of 2% of assets plus 20% of the upside! That structure can make the hedge fund manager quite rich if things go well but it also explains a lot about why Warren Buffett is winning his bet so far.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
November 11, 2014
An article today on BloombergView,com by Barry Ritholtz is titled "My Prediction: Your Forecast is Wrong". He gives many examples of how even the best-respected Wall Street analysts are so often wrong. Even well-known predictors of previous market crashes have gone on to crash and burn on their next big prediction. So remember that the next time you hear a forecast on TV of a big market crash, there's a very high chance he/she is wrong and there will certainly be someone else making a similar claim every year. Just by chance, eventually somebody will be right but I'm not letting one doomsayer scare me into selling all my stocks.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
November 10, 2014
Is your retirement plan based on working until you die? That's what Mrs. Fletcher thought. Remember her? "She's fallen and she can't get up!" Apparently if you're over 65 you have a 1 in 3 chance of falling each year with about a quarter of those having some lasting disability (says U.S. Centers for Disease Control and Prevention.) Maybe time to implement Plan B now and save aggressively. We won't know if Plan A works until it's too late.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
November 3, 2014
If we prioritize the most important uses for our money, what
comes after groceries, housing costs, basic clothing and medical
care/insurance? 1) Education costs and college savings for our kids; 2)
Retirement savings; 3) Cable TV; 4) iPhones for our families; 5) Car expenses;
6) Entertainment and the dining out; 7) Charity; 8) Vacations; 9) Discretionary
shopping. Put these in order of most important to least. Now we must ask
ourselves why we are spending money out of order.
- Larry Pike, CFA, Client Priority Financial Advisors LLC- www.clientpriority.com
Being smart with $$ -- Late October 2014 posts
October 31, 2014 (Halloween)
Scary day? Wanna hear something REALLY scary? Paying for a family of 4 to have iPhones from your early 40s until you retire, instead of putting that money in your IRA, can cost your retirement account a quarter million dollars. Two tin cans and a string anyone?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Scary day? Wanna hear something REALLY scary? Paying for a family of 4 to have iPhones from your early 40s until you retire, instead of putting that money in your IRA, can cost your retirement account a quarter million dollars. Two tin cans and a string anyone?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
October 29, 2014
Is the correct expression "penny wise, pound
foolish" or "pound wise, penny foolish"? And then does it
matter? You may bring your lunch to work every day to save money and then go by
the top iPad. Or you may decide you can live without those expensive luxuries
but then buy 2 cups of coffee a day at Dunkin. Whether the money spent is the
big stuff or little, either example above each year from graduation to
retirement is a lost chance at boosting your retirement fund by $300,000.
October 28, 2014
One of the great missed opportunities of the recent stock market nose dive and quick recovery was the chance to convert retirement assets from a pre-tax account to a Roth after-tax account at a discount. Converting during the recent market plunge could have saved you 5% on your tax bill versus doing it today and that's a permanent savings because Roth accounts will never generate a tax bill in the future if managed properly. People wondered whether to buy or sell stocks during the recent rout but a Roth conversion does neither. It changes the tax status but not your market exposure. And if the market kept falling, you could undo the conversion avoiding the opposite problem. Ask me if you'd like to know more and watch for the next plunge!
October 23, 2014
Stocks are up about 5% from the recent low point of the selloff after having fallen about 10% from the high point. We are now up 5% year-to-date on the S&P 500 index and many people feel relieved they didn't sell all their stocks a week ago. So what comes next? I will repeat what I have been reminding everyone: We don't know what comes next. So stick with your prudently prepared long-term plan and try to ignore the short-term volatility.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Stocks are up about 5% from the recent low point of the selloff after having fallen about 10% from the high point. We are now up 5% year-to-date on the S&P 500 index and many people feel relieved they didn't sell all their stocks a week ago. So what comes next? I will repeat what I have been reminding everyone: We don't know what comes next. So stick with your prudently prepared long-term plan and try to ignore the short-term volatility.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- October 16, 2014 letter on handling the market unpleasantness
October 16, 2014
The stock market headlines have been unpleasant over the last week. Every day when the market closes it seems we have fallen another 2% and in fact we are down 10% in the last month. The risk of investing in the stock market is that it sometimes has a high short-term volatility. This has certainly been proven true in the last few days. However we do not invest in the stock market for next week's needs. We invest for our needs over the next 5 to 20 years or more. And over the long-term, the stock market has been a much better place for your money than investments like bonds or cash equivalents.
A financial plan takes into account a person's long- and short-term needs. Short-term needs are usually covered by safer and less volatile investments. For your longer-term needs, you generally invest in assets that have a higher potential for long-term returns even though there can be some painful volatility along the way. The fact that the stock market has fallen over the last week does not change your objectives and long-term plan. Additionally, a diversified portfolio will have fallen much less than the overall stock market due to the fact that some assets, like high-quality bonds and REIT funds, have risen in the last week.
Analyst will debate whether the stock market drop is based on valid changes in fundamentals or not. Sometimes fear just takes over and everybody fights to get out of the market at the same time causing prices to drop quickly, even though there may not be real reasons for the market to suddenly fall. Nobody knows where the market goes over the next week or month or year. The only thing we know is that if we sell our stocks today then we lock in a 10% lower price then if we sold a month ago. We might do this because we worry that the market will continue to fall. Others are happy to invest cash in this market because they get to put their money to work at a price that is 10% lower than if they bought it last month. But as stated above, if you have a financial plan, then you are currently invested in a manner that is appropriate for you, except that your allocation to stocks, bonds, cash and other assets may have changed slightly on a percentage basis because of the respective moves within each asset class.
I am happy to discuss the market volatility with you further.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
The stock market headlines have been unpleasant over the last week. Every day when the market closes it seems we have fallen another 2% and in fact we are down 10% in the last month. The risk of investing in the stock market is that it sometimes has a high short-term volatility. This has certainly been proven true in the last few days. However we do not invest in the stock market for next week's needs. We invest for our needs over the next 5 to 20 years or more. And over the long-term, the stock market has been a much better place for your money than investments like bonds or cash equivalents.
A financial plan takes into account a person's long- and short-term needs. Short-term needs are usually covered by safer and less volatile investments. For your longer-term needs, you generally invest in assets that have a higher potential for long-term returns even though there can be some painful volatility along the way. The fact that the stock market has fallen over the last week does not change your objectives and long-term plan. Additionally, a diversified portfolio will have fallen much less than the overall stock market due to the fact that some assets, like high-quality bonds and REIT funds, have risen in the last week.
Analyst will debate whether the stock market drop is based on valid changes in fundamentals or not. Sometimes fear just takes over and everybody fights to get out of the market at the same time causing prices to drop quickly, even though there may not be real reasons for the market to suddenly fall. Nobody knows where the market goes over the next week or month or year. The only thing we know is that if we sell our stocks today then we lock in a 10% lower price then if we sold a month ago. We might do this because we worry that the market will continue to fall. Others are happy to invest cash in this market because they get to put their money to work at a price that is 10% lower than if they bought it last month. But as stated above, if you have a financial plan, then you are currently invested in a manner that is appropriate for you, except that your allocation to stocks, bonds, cash and other assets may have changed slightly on a percentage basis because of the respective moves within each asset class.
I am happy to discuss the market volatility with you further.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- Early October 2014 posts - October was pain!
October 15, 2014
Stocks are down again today. Painful, right? But what if you have a nicely balanced portfolio? Something like 60% U.S. stocks, 10% international stocks and 30% bonds? For the last week you are down about 3.9%. Not a disaster. And for the year you would be UP slightly, not down. Over the last three years, you would have a positive average annual return of over 15%. When put in that light, we should be cheering. It would just be nice if we could sleep through the ups and downs.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Stocks are down again today. Painful, right? But what if you have a nicely balanced portfolio? Something like 60% U.S. stocks, 10% international stocks and 30% bonds? For the last week you are down about 3.9%. Not a disaster. And for the year you would be UP slightly, not down. Over the last three years, you would have a positive average annual return of over 15%. When put in that light, we should be cheering. It would just be nice if we could sleep through the ups and downs.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
October 14, 2014
So many well-respected stock analysts say the market is cheap after it has fallen in the last few days. And so many say it will keep falling. Which of them are right? It's not about right or wrong. These are all just opinions. The market will be unpredictably volatile in the short term and in the long term it will reflect the growth of the global economy.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
October 11, 2014
A week in the financial markets like this last one reminds us that investing is an uncertain proposition. We hope to earn a good positive return that will boost our retirement savings account. While investing is likely to work in the long run, the one sure way to increase your account balance is to save more.
October 10, 2014
Volatility in the stock market is continuing today with stocks expected to open on the downside. But while we are down about 2% in the last week, we are still up on the year. What to do? If your personal circumstances have not changed then a little volatility doesn't change your financial plan and you should turn off the TV.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Volatility in the stock market is continuing today with stocks expected to open on the downside. But while we are down about 2% in the last week, we are still up on the year. What to do? If your personal circumstances have not changed then a little volatility doesn't change your financial plan and you should turn off the TV.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
October 1, 2014
In September, U.S. stocks were down. International stocks were down. Bonds were down. Is there any place to hide? You could keep all your money in a savings account earning 0.10% but then your purchasing power drops each year due to inflation. Keep the faith. The year-to-date numbers are much more encouraging. And if you are in "risky" assets then hopefully it is because you have many years to ride out the volatility in the markets.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- Late September posts
September 29, 2014
Class, pay attention. 40% of baby boomers are at risk of not having enough retirement money (says Employee Benefit Research Institute via Money Mag). But in the years when families are done paying for the kids' college, they start living very large and increase spending by 51% (says Boston College Center for Retirement Research via Money Mag). Okay class, how do we solve this very complicated conflict? Bueller? Bueller?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Class, pay attention. 40% of baby boomers are at risk of not having enough retirement money (says Employee Benefit Research Institute via Money Mag). But in the years when families are done paying for the kids' college, they start living very large and increase spending by 51% (says Boston College Center for Retirement Research via Money Mag). Okay class, how do we solve this very complicated conflict? Bueller? Bueller?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
September 28, 2014
Yikes! The markets were volatile this week! What do you do? If you have a financial plan, you need to ask yourself if anything about your circumstances has changed this week versus last week. If the answer is no, then there's nothing to do. What if you don't have a financial plan? Then the volatile markets are only one concern among many.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
September 26, 2014
Do you ever feel jealous of someone else's wealth? Former Wall Street Journal columnist Jonathan Clements responds the following way to his kids' comments that the neighbors must be loaded because of the fancy, new car they are driving: "We don't know how much money they have, just how much they spend."
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ - Mid/late September 2014 posts
September 25, 2014
Leasing a car or buy one? Some like leasing because you don't have to worry about selling your car when you're done with it. But did you know when you lease you generally pay a substantial fee to "write the contract" and then pay another to terminate it? Plus you are paying for the car during its most expensive years. I get it: it's fun to always own a new car. But remember, from graduation to retirement, leasing every three years instead of owning for five may be cutting your retirement account by $300,000.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Leasing a car or buy one? Some like leasing because you don't have to worry about selling your car when you're done with it. But did you know when you lease you generally pay a substantial fee to "write the contract" and then pay another to terminate it? Plus you are paying for the car during its most expensive years. I get it: it's fun to always own a new car. But remember, from graduation to retirement, leasing every three years instead of owning for five may be cutting your retirement account by $300,000.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
September 24, 2014
Saving for retirement. Saving for the kids' education. Saving to buy a new car. Saving for a vacation. How do you do it all?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
September 19, 2014
GOOD: Having money in your retirement account.
BAD: Not knowing if it's enough.
BEST: Having a plan that gets you to your goals so that you can relax and enjoy life today without worrying about the future.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
September 18, 2014
You know those stock tips you see from self-proclaimed experts on TV? How often do you think they get back on TV a few months later and tell you when they were wrong? Odds are that half of them did worse than the market average. Well I must congratulate Kathy Kristof of Kiplinger's for being brave enough to admit her 30% decline on her July pic k. She likes it better at the lower price. As would I, all else equal.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
September 17, 2014
Don't be fooled by fancy TV commercials telling you what stock fund to buy. Of the top 10 largest U.S. stock mutual funds, as listed in Kiplinger's this month, two of them are S&P 500 index funds that simply track the largest stocks in the market and do not have an active manager. Of the remaining eight that all pay a manager to achieve the best possible performance, only one performed better than the S&P 500 index funds over the last five years.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- Early September 2014 posts
September 11, 2014
Just because it's on sale doesn't mean it's cheap. And if you can buy it for $30 a month for the next two years instead of paying upfront, it still costs $720. A payment like that on one item after another from graduation to retirement can mean $100,000 less in your IRA.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Just because it's on sale doesn't mean it's cheap. And if you can buy it for $30 a month for the next two years instead of paying upfront, it still costs $720. A payment like that on one item after another from graduation to retirement can mean $100,000 less in your IRA.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
September 8, 2014
There is an old Wall Street expression that says "buy the rumor, sell the fact." It means that stock prices often go up in anticipation of good news and then many times fall when the actual good news is announced. In September 2012, Apple's iPhone 5 was introduced. The stock was at an historical high at that point and then lost approximately half its value in the next few months. That doesn't mean the same thing will happen this time now that Apple is again at a new high and about to announce its iPhone 6. Right when you think you have figured out a trend, the opposite often happens because everyone else figured it out at the same time and might be doing the same thing as you.
September 6, 2014
The
average American spends 35% of their after-tax paycheck on housing (including
utilities and insurance) and they save 12% (plus employer matches) says
Kiplingers. How are YOU doing?
- Larry Pike, CFA
- www.clientpriority.com
- Larry Pike, CFA
- www.clientpriority.com
September 2, 2014
80% of managers of large-cap stock funds have underperformed
a simple S&P 500 index fund so far this year according to S&P Capital
IQ Fund Research. Analysts say this worse-than-usual performance is likely due
to managers guessing stocks will fall and keeping a lot of their funds' money
in cash instead of stocks like they are supposed to. But what if you think your allocation to
stocks in your portfolio should be, say, 60%, and then it turns out you only
have 50% in stocks because your stock-fund manager isn't buying stocks? In a
year like this with stocks up about 8% year to date, that just cost you real
money.
- Larry Pike, CFA- www.clientpriority.com
Being smart with $$ -- Late August 2014 posts
August 29, 2014
(SAVE + INVEST) x TIME = WEALTH
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
(SAVE + INVEST) x TIME = WEALTH
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
August 28, 2014
Do you buy actively-managed mutual funds instead of passive funds because you think the manager will be smarter in a down market and not lose as much money? Should this offset the fact that 3/4 of actively-managed funds underperform their index benchmark on average? Should the best mutual fund have done better than the horrendous -37% return of the S&P 500 index in 2008? Well, the top-performing large-cap mutual fund over the last 10 years lost 43% in 2008!! I guess we need some new reasons to buy actively-managed funds.
August 27, 2014
Over-priced investment
advice. Does your investment advisor
charge you 1% of assets? Did you know that could be costing 1/6th of your
initial portfolio over 10 years and that might even be for inferior
performance? (For example a $300,000
starting portfolio might pay out $50,000 in fees over 10 years even if you
trail market averages.) Do they only advise on assets they control and ignore
the rest of your "big picture"?
Ask me about a different approach that can save you tens of thousands of
dollars and address ALL of your financial needs.
- Larry Pike, CFA
- www.clientpriority.com
- www.clientpriority.com
August 20, 2014
Have you heard the newscasters say that the stock market is up today because of strong economic data? And then the next day they say that the stock market is down because of strong economic data? On the second day, they argue that a strong economy may make the Fed raise interest rates which can be bad for stocks. Okay, who votes for believing everything we hear on the news?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Have you heard the newscasters say that the stock market is up today because of strong economic data? And then the next day they say that the stock market is down because of strong economic data? On the second day, they argue that a strong economy may make the Fed raise interest rates which can be bad for stocks. Okay, who votes for believing everything we hear on the news?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
August 18, 2014
You may have seen the story today that 36% of adults have zero retirement savings. Shockingly, 26% of people within 15 years of retirement have no retirement savings (Bankrate.com study.) If you have too little or no retirement savings, the time to start saving is now. The earlier the better and the more the better. Every day you put it off makes the goal of retiring someday more elusive.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
August 17, 2014
investors will always try to beat the market averages but the end result is more often trailing the average than beating it. Money Magazine in it's August issue highlights average market returns and then returns for the five largest mutual funds in each category. If you have read my past posts you will not be surprised to hear that for the last three years the S&P 500 index of large-cap stocks has beaten 4 out of 5 of the biggest large-cap funds that are actively managed to try to beat that index. And as a group the five also failed to beat their benchmark index. International stocks? Same story. Confused? I am. Teams were hired to beat an unmanaged pile of stocks and four out of five did worse! Any guesses why?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- Late July and early August 2014 posts
August 12, 2014
The battle! Life insurance provides protection against you dying too soon. Annuities provide protection against you living too long. The amazing comedian Steven Wright might have said you should buy them both and let them battle it out!
The battle! Life insurance provides protection against you dying too soon. Annuities provide protection against you living too long. The amazing comedian Steven Wright might have said you should buy them both and let them battle it out!
August 11, 2014
Do you wish you could be an investing titan and buy things like hedge funds? Do you feel cheated that you can't easily get in on those kinds of investments? Isn't a stock/bond strategy for suckers by comparison? Well, Money Magazine reported this month that in the last decade hedge funds have returned less than half as much as a simple 60% stock/40% bond portfolio. But aren't they supposed to at least protect you in a downturn? Money says in the financial crash hedge funds did no better than the stock/bond mix.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Do you wish you could be an investing titan and buy things like hedge funds? Do you feel cheated that you can't easily get in on those kinds of investments? Isn't a stock/bond strategy for suckers by comparison? Well, Money Magazine reported this month that in the last decade hedge funds have returned less than half as much as a simple 60% stock/40% bond portfolio. But aren't they supposed to at least protect you in a downturn? Money says in the financial crash hedge funds did no better than the stock/bond mix.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
August 2, 2014
Click www.facebook.com/clientpriority and like it, gosh darn
it!
Kiplinger's ranked mutual funds
and listed the top performers (Sept '14 issue). Should we buy the ones that did
best in the last year? Shouldn't we rely on these talented investment managers?
Before you do, ask why it is that the top 3 performers for the last year are
nowhere to be seen in the list for the top 5- and 10-year performers?
This is true for the large-cap list, the mid-cap list, the small-cap list AND
the large-cap international list! Be
careful about jumping into a hot investment.
In many cases, what was hot last year may just be a fleeting success
story.
- Larry Pike, CFA
- www.clientpriority.com
- Larry Pike, CFA
- www.clientpriority.com
July 30, 2014
How can we save money when it's so hard to shop around for our "necessities." AT&T Wireless charges me $225 a month for a family plan with calling, data, texting etc. But then they tried to sell me on a "share" plan that has everything but only cost $164 a month. That saves $700 per year!! But then they warned that the share plan causes me to lose a per-phone discount of $25/month if I use the two-year commitment. That adds between $300 and $1200 per year based on number of upgrades. But if I use the "Next" plan for upgrades then I won't lose the discount. But the "Next" plan costs an extra $25 per month!!! No matter what, they are getting your money. But they want you to think you're getting a great deal. Anyone have a couple of tin cans and a string I can borrow?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
How can we save money when it's so hard to shop around for our "necessities." AT&T Wireless charges me $225 a month for a family plan with calling, data, texting etc. But then they tried to sell me on a "share" plan that has everything but only cost $164 a month. That saves $700 per year!! But then they warned that the share plan causes me to lose a per-phone discount of $25/month if I use the two-year commitment. That adds between $300 and $1200 per year based on number of upgrades. But if I use the "Next" plan for upgrades then I won't lose the discount. But the "Next" plan costs an extra $25 per month!!! No matter what, they are getting your money. But they want you to think you're getting a great deal. Anyone have a couple of tin cans and a string I can borrow?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
July 25, 2014
Nassim Teleb, author of The Black Swan, said:
"I'm not saying that Warren Buffett is not skilled, only that a large population of random investors will almost necessarily produce someone with his track records just by luck." Do you agree?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- July 2014 posts on Vanguard's Myths of Indexing Debunked
July 17, 2014
More indexing myths? OK, last one. "You get what you pay for." Should we expect highly-rated funds with high fees to perform better? Vanguard did an analysis and as you have guessed by now, high-cost funds underperformed low-cost funds for the last 10 years. But can you believe that over the last 10 years, the higher a fund was rated by Morningstar, the worse it did vs. its peers (in the three years after receiving the rating)?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
More indexing myths? OK, last one. "You get what you pay for." Should we expect highly-rated funds with high fees to perform better? Vanguard did an analysis and as you have guessed by now, high-cost funds underperformed low-cost funds for the last 10 years. But can you believe that over the last 10 years, the higher a fund was rated by Morningstar, the worse it did vs. its peers (in the three years after receiving the rating)?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
July 16, 2014
Still negative on indexing? Vanguard's Myth 2 says people believe that indexing gives you just average returns and don't you want better than average? But Vanguard points out that over the last 10 years, large-cap indexing has been more than 80% of actively managed large-cap funds. That doesn't sound average to me.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
July 15, 2014
Don't believe in index funds? Vanguard points out the problem with myths of indexing. Myth 1: Indexing only works in efficient markets. Some people say it doesn't work for sectors like emerging markets. But every market has an average return and Bogle of Vanguard points out "investors as a group must fall short of the market return by the amount of the costs they incur." And for the 10 years ended 12/31/13, about 75% of active emerging markets funds underperformed the index. Myth 1 busted!!
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- Early July 2014 posts
July 13, 2014
Top 100 baby names now include Khaleesi (Game of Thrones mother of dragons) and Katniss (Hunger Games) according to Nameberry. While fads are funny in baby naming, it can be dangerous in investing. So many people buy into the investment sector that was hot last year. But the time to buy that sector was last year, not necessarily now. Very often you are buying after much or all of the upside is already baked in. Sometimes you are even buying into a market that is ready to fall back to normal levels. Diversified portfolios keep you exposed to multiple sectors allowing you to catch the upside of each when it is their turn to rise. (Just for the record, the Social Security admin does not show Khaleesi or Katniss in their top 1000 names for new babies.)
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Top 100 baby names now include Khaleesi (Game of Thrones mother of dragons) and Katniss (Hunger Games) according to Nameberry. While fads are funny in baby naming, it can be dangerous in investing. So many people buy into the investment sector that was hot last year. But the time to buy that sector was last year, not necessarily now. Very often you are buying after much or all of the upside is already baked in. Sometimes you are even buying into a market that is ready to fall back to normal levels. Diversified portfolios keep you exposed to multiple sectors allowing you to catch the upside of each when it is their turn to rise. (Just for the record, the Social Security admin does not show Khaleesi or Katniss in their top 1000 names for new babies.)
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
July 9, 2014
Is Gold valuable? Who says? Is it an inflation hedge? Will it have value if society turns to anarchy? James Glassman (in Kiplingers 07/2014) tells of data where gold often fails to simply keep up with inflation. And if we find ourselves in anarchy, who wants to carry around 100 pounds of gold? Oh, and by the way, production is up to 2,500 tons per year, a 100% increase from 1980, says Glassman. Maybe you like it for a small piece of your portfolio but there are a lot of ways to add assets to your portfolio that provide decent return and don't act like stocks or bonds.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
July 8, 2014
So you want a certain investment allocation, like 60% stocks, 30% bonds and 10% cash, or whatever is right for you. And then you buy actively managed mutual funds to hit those targets. But then whoops, it turns out that your actively managed fund is invested partially in something other then it's advertised portfolio or keeps a very high cash position. Loomis Sayles Bond Fund for example was 16% cash or very short treasuries at the end of April. So much for that target portfolio. (Index funds, on the other hand, tend to be very close to fully invested in their advertised assets.)
July 1, 2014
Which is more valuable? 100 shares of a stock worth $50 a share that you bought at $40? Or 100 shares of the same stock you bought at $60? (This is not similar to the question that asks whether a pound of feathers or a pound of rocks is heavier.) Hint: One of them has a valuable tax benefit.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Which is more valuable? 100 shares of a stock worth $50 a share that you bought at $40? Or 100 shares of the same stock you bought at $60? (This is not similar to the question that asks whether a pound of feathers or a pound of rocks is heavier.) Hint: One of them has a valuable tax benefit.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- Late June 2014 posts - Apple stock
June 25, 2014
People tell me they like Apple stock and are thinking of buying some. But if you own a stock index fund (or one of many other large funds), you already own it. If you have $300k in an S&P 500 index fund, then you already own about $10,000 of Apple stock. It's the largest component of the S&P 500. So the question isn't whether to buy it; it's whether to buy more.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
People tell me they like Apple stock and are thinking of buying some. But if you own a stock index fund (or one of many other large funds), you already own it. If you have $300k in an S&P 500 index fund, then you already own about $10,000 of Apple stock. It's the largest component of the S&P 500. So the question isn't whether to buy it; it's whether to buy more.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
June 24, 2014
When Apple announced its stock split, friends asked me if they should buy it because now it will be cheaper. But will it? If the stock is splitting 7-for-1 then your one share will turn into seven shares. But in the absence of any change in the market value of the company, each $630 share will now be worth $90 instead. The total value is the same either way. But will the split cause more investors to buy which might boost the price? Maybe but you're not the first one to think of that. Usually investors anticipate such a move. In fact Apple stock is down since the split while the stock market as a whole is up. Give me a crystal ball and I will tell you where Apple is going next.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- Early June 2014 posts
June 13, 2014
Do you think you can pick a good stock to buy? Are you better than the top Wall Street analysts? Well, according to Thompson Reuters and a CNN Money study, the top 10 favorite stocks of Wall Street in 2011 FELL by 3.5%, compared to being flat if you bought an S&P 500 index fund. In 2010, the top picks beat the S&P by a ton but were themselves badly beaten by and analysts' most HATED stocks. In 2009, the analysts' favorite picks again lost to the S&P by 4% while their most hated were UP 70%!! Maybe dartboards on the financial page are another option.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Do you think you can pick a good stock to buy? Are you better than the top Wall Street analysts? Well, according to Thompson Reuters and a CNN Money study, the top 10 favorite stocks of Wall Street in 2011 FELL by 3.5%, compared to being flat if you bought an S&P 500 index fund. In 2010, the top picks beat the S&P by a ton but were themselves badly beaten by and analysts' most HATED stocks. In 2009, the analysts' favorite picks again lost to the S&P by 4% while their most hated were UP 70%!! Maybe dartboards on the financial page are another option.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
June 12, 2014
Visa says we spend an average of $300 on the 4th of July and $978 on a prom. NRF says we spend an average of $163 on Mother's Day and $114 on Father's Day. Does anyone wonder why we all complain that we can't save enough money?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
June 9, 2014
Money Magazine survey: top item couples fight about is money. Top complaint: each thinks the other spends money too frivolously. Who is right?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
June 7, 2014
Fact #17 on the benefits of fee-based financial planning vs. paying a percentage of assets under management: In an IRA, the assets-under-management guys are taking thousands out of the actual IRAs to pay the high fees. That's money that will no longer be growing tax free or tax deferred. Fee-based planners leave all your IRA money alone.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
June 4, 2014
Yesterday the oldest American turned 115! How could a retirement plan support living that long? At 65 years old, your life expectancy is mid 80s and you have a 30%-40% chance of even making it to your 90s! I don't like the idea that I might die in my 70s with money in the bank that I could've spent. But I like even less the idea I might live to my 80s or 90s with an empty bank account!
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
June 2, 2014
Warren Buffett is quoted as having said: "For some intermediate periods of years, a few (investment managers) are bound to look better than average due to chance--just as would be the case if 1000 coin managers engaged in a coin-flipping contest. What about in the long term?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- Late May 2014 posts
May 31, 2014
Are you paying your financial advisor $50,000? If you have a $300k portfolio and are charged 1% of assets under management, you pay $3000 in the first year. And what about over 10 years if your investments return 6% annually? Now it's almost $40,000. What if you add in the money you could have earned on those fees paid? Now it's $50,000. The same exercise over a 20 year period will cost you $150,000. Are you getting service worth that much? Speak to me about fee-based financial advice and planning.
Are you paying your financial advisor $50,000? If you have a $300k portfolio and are charged 1% of assets under management, you pay $3000 in the first year. And what about over 10 years if your investments return 6% annually? Now it's almost $40,000. What if you add in the money you could have earned on those fees paid? Now it's $50,000. The same exercise over a 20 year period will cost you $150,000. Are you getting service worth that much? Speak to me about fee-based financial advice and planning.
May 29, 2014
Money Magazine (May 2014) reports that if you own actively managed funds in your portfolio, one for US stocks, one for international stocks and one for domestic bonds, you have only a 17% chance of beating a simple index fund portfolio with the same asset class exposure. But get this: if you increase the number of actively managed funds to three for each of these asset classes, your chances of beating the index fund portfolio drop to only 9%. It makes sense if you think about it.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Money Magazine (May 2014) reports that if you own actively managed funds in your portfolio, one for US stocks, one for international stocks and one for domestic bonds, you have only a 17% chance of beating a simple index fund portfolio with the same asset class exposure. But get this: if you increase the number of actively managed funds to three for each of these asset classes, your chances of beating the index fund portfolio drop to only 9%. It makes sense if you think about it.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
May 28, 2014
Should we invest with the most talented managers in the world or just plop our money in an unmanaged S&P 500 index fund? And who is more talented than Warren Buffett? Well over the last five years Buffet's Berkshire Hathaway (a stock that is like a mutual fund holding his investment choices - ticker BRK-B) has returned 2% less per year than the S&P 500 index funds. 2% per year over the last five years would have cost you about $20,000 on just an initial $100,000 investment. Ouch.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Should we invest with the most talented managers in the world or just plop our money in an unmanaged S&P 500 index fund? And who is more talented than Warren Buffett? Well over the last five years Buffet's Berkshire Hathaway (a stock that is like a mutual fund holding his investment choices - ticker BRK-B) has returned 2% less per year than the S&P 500 index funds. 2% per year over the last five years would have cost you about $20,000 on just an initial $100,000 investment. Ouch.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
May 27, 2014
S&P/Case-Shiller says home prices are up 12.4% in March from a year ago. Where are they going in the next 12 months? Nobody knows but many will guess. If you run across someone who says they know for sure that prices will keep rising, ask them why they haven't mortgage everything they owned to buy more real estate.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
May 23, 2014
Dying can be very tax efficient. If you own a stock you bought at $10 and it's now at $50, if you sell it you owe taxes on the $40 gain. But if you die before selling, your heirs inherit it with a cost basis of the day of death. So they can sell it for $50 the next day and pay no capital gains tax. Why is it the IRS is encouraging us to die?
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
May 22, 2014
Should you put money in a Roth IRA instead of a traditional IRA? If you are in a low tax bracket now then you don't give up much by contributing to a Roth and if your bracket is higher later (either because of your personal circumstances or because the government realizes it's going broke and taxes everybody more) then you avoid higher tax rates later. If you already have a traditional IRA, a Roth can give you tax diversification that would help if the government does tax everyone higher years from now when you are in retirement and need this money.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
May 21, 2014
Have you seen on the news a respected analyst saying that stocks are either overpriced or underpriced? For every well-respected analyst that gives his/her opinion on the market, there's an equally well-respected analyst that has the opposite opinion. Beware being too quick to believe.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
May 20, 2014
Okay, so remember my post where you could have $1 MILLION if you saved $10/day from graduation until retirement? Well believe it or not, a HALF MILLION comes from the first 10 years saving. The other HALF MILLION comes from the last 35 years. The moral: even though it's too late for that million whatever time you have left until retirement, start saving NOW! Money saved earlier grows more than money saved later.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- Not too late to have it all
May 19, 2014
OK, many of you laughed that it's too late for most of us to get the benefit of starting your retirement savings right out of college. But if you start now and can find $20 per day to drop into your retirement stock fund, in 20 years at 7% returns, you'd have an extra $300,000 for your golden years. Not a million dollars, but instead of crying over what you haven't done, we can start doing what's necessary from this point forward. The government helps: they let you put extra money into your IRA and 401(k) if you are 50 or older.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
OK, many of you laughed that it's too late for most of us to get the benefit of starting your retirement savings right out of college. But if you start now and can find $20 per day to drop into your retirement stock fund, in 20 years at 7% returns, you'd have an extra $300,000 for your golden years. Not a million dollars, but instead of crying over what you haven't done, we can start doing what's necessary from this point forward. The government helps: they let you put extra money into your IRA and 401(k) if you are 50 or older.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- The answer to it all
May 16, 2014
ONE-MILLION-DOLLARS
Is $1,000,000 at retirement realistic? Resist a couple of little things and save $10 each day. If you save and invest an extra $10 every day from graduation until retirement, and earn 7% in the stock market, you will have an extra:
ONE-MILLION-DOLLARS
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
ONE-MILLION-DOLLARS
Is $1,000,000 at retirement realistic? Resist a couple of little things and save $10 each day. If you save and invest an extra $10 every day from graduation until retirement, and earn 7% in the stock market, you will have an extra:
ONE-MILLION-DOLLARS
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- Early May 2014 posts
May 15, 2014
Is the stock market overpriced, underpriced or at a fair level? Since current stock prices reflect the collective opinion of all of the hundreds of millions of investors in the world, when you say it's over- or under-valued, you're saying you know better than all those hundreds of millions. But I won't tell you you're wrong!
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Is the stock market overpriced, underpriced or at a fair level? Since current stock prices reflect the collective opinion of all of the hundreds of millions of investors in the world, when you say it's over- or under-valued, you're saying you know better than all those hundreds of millions. But I won't tell you you're wrong!
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
May 14, 2014
Have you wondered if the current generation of new retirees is less ready for retirement than their parents? Well, 20 years ago only 21% of new retirees (age 65-74) still had a mortgage. In 2010 that number rose to 37% according to the National Center for Policy Analysis. For those aged 75 and older the percentage with a mortgage rose to 21% from only 6%. Retiring without that makes a big difference.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
May 13, 2014
Did your investment portfolio do well last year? 10%? 15%? A simple blend of 70% stocks and 30% bonds gave you a 22% return in 2013. If you didn't get that close to that you may want to rethink your investment strategy. Missing out on a great year like that can hurt, especially when the surrounding years may be much less exciting. Like this year so far, where that simple portfolio has returned 2.5%.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
May 12, 2014
Do you have a stock you inherited or maybe received when working for an old company? And are you wondering whether to sell it or not? Ask yourself, "would I buy this stock if I didn't own it?" The answer is probably no, so if you don't have tax issues with it, sell it and reinvest the money in your diversified stock fund.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
May 8, 2014
I saw on Motley Fool 3 steps to financial success:
Work a lot
Spend a little
Invest the rest
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Being smart with $$ -- Catching up with March posts
March 31, 2014
Money Magazine surveyed 1000 adults on finances. Of those with household incomes under $100,000, 55% say they are living paycheck to paycheck. Which means 45% are not. Of the households earning over $100,000, 37% said they are also living paycheck to paycheck.
Money Magazine surveyed 1000 adults on finances. Of those with household incomes under $100,000, 55% say they are living paycheck to paycheck. Which means 45% are not. Of the households earning over $100,000, 37% said they are also living paycheck to paycheck.
March 28, 2014
Do you want to know how to really win the lottery? Don't play.
If instead of playing $1 each drawing from the end of college until retirement, you invested that money in the stock market and earned a 7% annualized return, you would have $180,000 extra in your retirement account. I know a lot of people that would consider $180k a pretty good lottery win.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Do you want to know how to really win the lottery? Don't play.
If instead of playing $1 each drawing from the end of college until retirement, you invested that money in the stock market and earned a 7% annualized return, you would have $180,000 extra in your retirement account. I know a lot of people that would consider $180k a pretty good lottery win.
- Larry Pike, CFA, Client Priority Financial Advisors LLC
- www.clientpriority.com
Dear reader:
Thank you for visiting my new blog. I would offer you a drink and a comfortable place to sit but this room is only virtual so please use your imagination and pretend I did.
I am creating this page to provide sensible financial advice that can help people make smart decisions about their money. Small mistakes with money over time can add up to substantial differences in your savings for long-term goals. Following my tips may help you to save hundreds of thousands of dollars over the decades so that you can reach your retirement or other savings goals.
I would like to start by posting historical items previously expressed elsewhere. I hope you find my posts useful and follow the advice so that you can feel smarter than your friends when it comes to money.
Larry Pike, CFA
Client Priority Financial Advisors, LLC
www.clientpriority.com
March 25, 2014
To my friends who helped me name my new financial advisory firm: Thank you!! I received so much great advice on Facebook and elsewhere and it was all so helpful. So I am happy to introduce:
Client Priority Financial Advisors LLC
This name reflects that my business is about helping the client unlike too many financial advice options that seem more about helping the advisor. I am happy to explain how.
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