It’s Your Money ~ Fall 2021

Week 1: Introduction & Tax Update

Introduction and Tax Update – Video Webinar – Fall 2021

 
Video Presentation By Peter Kote, Don Vivrette & Marty McNamara

Welcome to our first session of eight meetings called “It’s Your Money!”. The name came about because many people relinquish their financial responsibility to others: this could be the spouse, child, neighbor, broker or the advisor. We believe the longer you stay in control of your money, either through a FEE ONLY advisor (owes a fiduciary duty to you) or through your personal efforts, the longer and happier you will live!

You can find our Mission Statement and rules for the workshops in the ABOUT US section. WE ARE NOT LIKE 95% OF THOSE OTHER “Free Lunch or Dinner” FINANCIAL PROGRAMS – we do not sell insurance or financial products. Our only bias is that we believe people should consider charitable organizations in their financial plans because our tax system encourages us to do so and giving tells the world about our personal values and interests. We especially encourage giving through your estate plan. Consider a Charitable Remainder Trust or a Charitable Gift Annuity when selling highly appreciated assets as well as making a charitable organization a beneficiary on your IRA, 401K or 457 plan – it is very tax wise!

We use the Quiz as an introduction to the financial world. Please see the Quiz and Answers by visiting our Resources section.

The concepts we want you to understand are as follows:

1. The financial world is a sales world. It is very similar to real estate although the sales person in the financial world do not refer to  themselves as “agents” (there is no law as to what you call yourself; wealth advisor, financial planner or consultant, etc.) According to the regulators, they are Registered Representatives of the company they work for. Since they are employees of their broker/dealer (ie. Morgan Stanley, Merrill Lynch, LPL, Ameriprise, etc.) they have a greater duty to the company than to the client.
2. Most individuals do not know much about their advisor – for questions you should ask to get to know your advisor CLICK HERE.
3. Most of us are not rational when it comes to money.
4. Comprehensive financial planning – Why investing a dollar does not come first. Only after we have reviewed our goals and objectives, time horizon, risk tolerance, tax bracket, asset allocation, diversification strategy and cash flow needs should we invest a dollar.
5. The Securities and Exchange Commission oversees all investments in the USA and operates on the premise that if everything is fully disclosed about an investment that a reasonable person can make up their own mind.
6. The first thing you should ask a professional who wants to give you advice is – “HOW ARE YOU PAID?”

PBS FRONTLINE: Money, Power and Wall Street

Inside the epic rise of a new financial order — and the trouble that followed

Watch Money, Power and Wall Street: Part One on PBS. See more from FRONTLINE.

Week 2: Annuities and Mutual Funds

Annuities & Mutual Funds – Video Webinar – Fall 2021

Video Presentation By Peter Kote, Don Vivrette & Paul Horn

In Week 2 we focus on two of the most heavily sold products by financial broker/dealers, insurance companies, banks and credit unions; Annuities and Mutual Funds. There are many other financial products sold (hedge funds, structured notes, options, individual stocks and bonds, etc.) by Wall Street. We strongly believe that 95% of the U.S. public should NOT purchase a commissioned financial product (plenty of no commissioned products in the marketplace) because of the inherent conflicts in the sale.

You need to ask: Is the recommendation being made because the product is best for the consumer or is it best for the sales person in terms of a commission? Your major broker/dealers have annual net earnings that average over $8 Billion per year.

For annuities please understand the SURRENDER CHARGES. For example, if the surrender charge is 7% in the first or second year, it is more than likely that the sales person’s commission is 7% of the investment. For mutual funds, you must understand how you are being charged (A, B & C shares) and the expense ratio because expenses are a major detriment to the annual performance of the fund you have chosen.

HighTower Whiteboard Animation: Brokers vs. Fiduciaries

Investors are taking a hard look at the people managing their money. Elliot S. Weissbluth, the CEO of HighTower, has been a visionary on this issue for over a decade. In this whiteboard video, Elliot cleverly explains the difference between brokers and fiduciaries and sheds light on the issues surrounding the industry.

Week 3: Financial Planning I

Financial Planning – Video Webinar – Fall 2021

Video Presentation By Peter Kote, Don Vivrette & Delia Fernandez

In Session Three we focus on how you should begin viewing investing and financial planning by understanding who the players are within the financial services industry.  There are over 140 designations, most of which are not very meaningful compared to licenses and registrations required by state and federal law.

The two most popular and legitimate designations are the Certified Financial Planner (CFP) and the Chartered Financial Analyst (CFA).  The CFA is usually a person that does the investing in specific securities and usually works for Mutual Funds.  The CFP credential is for the consumer and focuses on comprehensive financial planning including goal setting, insurance review, taxes, balance sheet, determining risk tolerance, writing a financial plan, estate planning and asset allocation and investing.

We believe every consumer should know how their financial planner is paid and their legal duty of care to the client.  Brokers usually have a “SUITABILITY” standard which holds them to less accountability   Whereas a “fee only” Advisor or Registered Investment Advisor has a “FIDUCIARY” duty to you, meaning if they do not do what is “in your best interest” they could be held liable.

In Financial Planning 1 we focus on the importance of knowing your net worth and spending plan.  We also cover taxes and insurance briefly.

Week 4: Financial Planning II

Financial Planning II – Video Webinar – Fall 2021

Video Presentation By Peter Kote, Don Vivrette & Delia Fernandez

Week 4 is a continuation of Financial Planning with the focus on Asset Allocation and the need to re-balance   A person’s asset allocation is one of the most important decisions they will make and many believe is the greatest factor for a portfolio’s percentage annual return.

Week 5: Medical Care Planning

Medical Care Planning – Video Webinar – Fall 2021

Video Presentation By Peter Kote, Trevor Murprhy and Michael Demoratz

In this session you will learn the definition of Long Term Care and how you should go about reviewing your needs.  Long Term Care covers care giving services to assist individuals with Activities of Daily Living that can be provided by family members or outside professionals.

Long Term Care could be one of the greatest expenses during our lifetime. It is imperative that seniors discuss LTC and make sure they have sufficient liquidity in their estate.  Our government has put together a website with an abundance of information and resources that we have found extremely useful. Their break down of LTC is as follows…

Please visit LongTermCare.gov for more information

1. Understanding long-term care services and your possible need for services can help you maximize your independence and functioning at a time when you may not be fully independent due to a sudden illness, chronic condition or accident. 
2. Planning ahead for long-term care is important because there is a good chance you will need some long-term care services if you live beyond the age of 65. Almost 70% of people over 65 need LTC. Information on this site can help you plan.
3. Paying for long-term care is difficult. Many people think Medicare pays for long-term care – but it doesn’t. Paying for LTC out of your personal income and resources can be very costly.

Here at Financial & Estate Literacy, we highly recommend you update your Advance Health Care Directive (sometimes called a living will or a Durable Attorney for Medical Decisions) AND either the booklet called “Your Way” (www.help4srs.org) or 5 Wishes (www.agingwithdignity.org)  Most of us do not spend enough time with our agent/representative to let them know how we want our death and medical care handled when we cannot communicate with the doctor ourselves.

Own Your Future

A Video from the Minnesota Department of Health & Services

Week 6: Equity Investing

Equity Investing – Video Webinar – Fall 2021

Video Presentation By Trevor Murphy, Don Vivrette and John Prichard

As we learned from our previous session on INVESTMENTS (Financial Planning 2) we need to determine our asset allocation model; what percentage of our investments will be allocated to the equity side versus the fixed income side. Equity means ownership and it provides the highest return along with the most volatility. In this session we discuss terminology, importance of diversification, timing, risk, re-balance and performance.

There is no “best” investment only a “best” portfolio which means you are properly diversified – a MUST KNOW for every consumer.

Week 7: Fixed Income Investing

Fixed Income Investing – Video Webinar – Fall 2021

Video Presentation By Peter Kote , Don Vivrette & Kurt Beimfohr

A fixed income security is an investment that pays regular income in the form of a coupon payment, interest payment or preferred dividend. An equity investor is an owner; a fixed income investor is a lender. At one time, the fixed income area was considered an excellent choice for risk-averse investors seeking a stable source of income payments at predictable intervals. It was considered low risk although it meant relatively lower returns; today the return is so low that it is very difficult for one to live off Certificate of Deposits (CD) or Treasuries.

Other than CDs, this is not an area for the less knowledgeable consumer. Michael Lewis, Liar’s Poker, spoke eloquently on how Wall Street manipulates and sells Fixed Income Investments. The movie Rounders (about the world of poker) delivers a life lesson not unlike the bond markets. “If you sit down at the table and within the first half hour can’t identify the fish, then you are the fish.” We are paraphrasing but you get the point. Don’t be the fish.

Week 8: Money and Your Mind

Your Money and Your Mind – Video Webinar – Fall 2021

Video Presentation By Peter Kote , Don Vivrette & Mark Rylance

According to Dalbar Associates, the average mutual investor trails their respective index by over 4% per year. In this session we explore the psychological side of investing that leads to this dramatic underperformance. This session will dive into recent research in neuro science that proves that the human brain is hard wired to make highly emotional and mistake prone investment decisions. We also cover how the 24/7 media news cycle wreaks havoc on our decision making, again leading to poor investment decisions and performance returns. Finally we recap the five most important takeaways that lead to investment success.