Archive for Financial Planning

Staying Financially Grounded

Financial Planningon April 4th, 2018No Comments

Written By: Ryan Rasmussen

During times of market volatility, investors can feel like they’re riding a bumpy roller coaster ride. And while our worldview about the markets is that human beings are fundamentally growth seeking and resilient, we recognize that the bumps along the way can make investors feel dizzy. One of the ways we try to help mitigate this dizziness is by encouraging you keep your Live Big® goals a priority. With this in mind, we share a few ideas to remind you to take a deep breath and stay focused on the things most important in your life.

Staying Organized

Financial anxiety can take many forms. Some may allow their stress to hinder them from making decisions, and others may make rash decisions without a full understanding of the implications. No matter if you respond in one of these two ways or otherwise, these behaviors are normal! When you feel yourself falling into an anxious mindset, accepting that these feelings are “normal” can help you take small actions to keep you from falling any further. A great first step to building confidence in this realm is to stay organized. For many, organization can provide a clearer depiction of where you are and where you need to go. For example, designating a folder for your tax documents can help prepare you for filing your taxes. You will be able to collect all of the required documents and move to the next step swiftly and confidently. Strategies like this can help keep you focused on your overall financial picture and provide you a path to your next objective.

Refer to Your Policies

At Yeske Buie, we believe in Policy-Based Financial Planning® as an enabler of financial groundedness. Financial planning policies act as a set of guidelines to make it easier to stick with a consistent course of action in the midst of an ever-changing environment. Think of them as guardrails for the unexpected. One of the keys to grounded policies is to align them with your values. When creating policies for our Clients, we start by helping them explore areas in their life that motivate them and we work together to create goals that align with these areas. From there, we design policies that will bridge a Client’s goals and values together. For instance, one may feel that financial security is a source of empowerment. A means to increase one’s financial security, then, might be to create an emergency fund for unexpected hardships. An example of a policy that may help one achieve this goal goal may be to save 15% of your income and half of every windfall, such as a bonus, toward your emergency fund. A policy, such as this one, can help keep you on track to achieving your goals with minimal thinking or stress and by sticking with percentages rather than fixed amounts, this creates a goal that is always achievable.

Befriend your Anxiety

Take a moment to remember a time when you felt anxiety and discomfort wash over you. My guess is that, like most, you quickly tried to deflect these feelings. Next time, try a different approach. When you feel anxious, ask yourself the following questions:

  • Why am I feeling this way?
  • What are things I can do to better my future self?
  • How did I handle a prior situation when I felt this way?

In doing this you can create more awareness in recognizing what you fear and the sources. And with awareness, you can be better prepared to take the steps necessary to overcome your fears, rather than avoiding the situation all together and continuing your discomfort. Creating strategies to move past difficult life situations can help you feel better equipped to continue working towards your goals.

Staying organized, creating policies, and familiarizing yourself with your anxiety are just a few ideas to help you feel grounded, motivated, and secure in times that reflect the opposite. Let’s be honest, anxiety has a place in all of our lives. Let’s identify it, and use it to keep us going. And of course, whenever you experience feelings of stress or uneasiness during moments of volatility or otherwise, know that we are always available to talk and remind you of your policies and the goals at the top of your priority list.

All Our Clients Are ‘Round’

Financial Planningon March 21st, 2018No Comments

Written By: Zach Bennedsen

No, we did not just call our Clients fat. Today, we’re writing about the literary concept of a flat vs. a round character and how it applies to Yeske Buie. We’d like you to take yourself back to your high school English class. While you were busy passing notes (or sending texts, depending on the age of the reader), the teacher may have been sharing some information actually worth retaining. In this case, we’re referring to the two, well-known categories of literary characters: round and flat. A round character is one that undergoes development throughout a story. They are complex and their characteristics cannot easily be summarized in a few sentences. Most importantly, a round character experiences growth as the pages turn. Conversely, a flat character is predictably one-dimensional. They do not undergo development or change, and their characteristics can be captured in the span of a sentence or two.

While the concept of round vs. flat stems from literature, we can easily apply it to people in our lives. Of course, every human being is complex. Everyone has dreams, memories, and regrets. However, until there is a meaningful relationship, we do not see the dimensionality of a person, and instead see them as flat. For example, the cashier at the grocery store, while at work, is a purely flat character to the other shoppers. A neighbor with whom you only share a friendly “hello” when picking up the morning paper is also flat, unless either party makes an effort to develop a relationship.

On the other side of the coin, our lives are made interesting by round characters. Friends and family, whom we have seen develop and change over time, are perhaps the best example of round characters in our lives. A coworker who you observe growing into a new role, or who you just learn more about during a job, is another example.

To us, some of the “roundest” people we know are our Clients. We are in a unique and privileged position to have a relationship with our Clients that spans time – often years or even decades. We are there as Clients envision and develop their goals, embark on new careers, and grow their families. Through a robust discovery process, we have a depth of understanding regarding their true nature that is not afforded to many. Through tools like the Wheel of Life (pictured right), we help Clients better understand the quality of various realms that constitute their environment. We also use a Life Transitions Survey to encourage Clients to think about the various changes they are currently experiencing, and what might be on the horizon. These tools allow us to see all our Clients as their roundest selves.

We have this opportunity because financial planning is not transactional in nature, but instead transformational. If we were simply selling financial products, our Clients could be treated as flat. Since we are instead serving as a trusted advisor through all the ups and downs, we want our clients as round as they can be. The more we know the Client, the better we can serve them. So, since eating that extra slice of cake won’t help Yeske Buie develop rounder Clients, we ask for your continued willingness to share your true selves with us. It’s an honor to see your complexity, and we truly believe it makes for better planning.

Get More from Your Credit Score

Financial Planningon March 8th, 2018No Comments

Written By: Ryan Rasmussen

Credit scores are used by individuals and organizations as a method of assessing a person’s financial responsibility. The “grading scale” ranges from 300, being the weakest, to 850, being the strongest. As a reference, Experian assesses a credit score above 670 as “good”. It is widely understood that this three-digit score helps lenders decide whether or not to approve someone for credit cards and loans, but the significance of this number permeates much further than that. As such, it is important to understand how your credit score is comprised, especially if you are trying to increase your score.

So, what exactly makes up your credit score? Data from your credit report is organized into five categories; each category making up a different portion of your credit score. Furthermore, each category carries a different “weight” in the composition of your score, so categories that make up a larger portion of the score have a more significant impact on your overall number.

Composition of Your Credit Score

The following is a break down of the composition of your credit score.

Payment History (35%): Your payment history is the heaviest weighted factor that determines your credit score. Thus, making on-time payments will benefit your credit standing forever. As you may assume, then, having a negative payment history will have the opposite effect on your credit score. Some aspects of a negative payment history, such as accounts sent to collections, tax liens and bankruptcy, will fall off your record in seven to ten years.

Credit Utilization (30%): Your credit utilization is the ratio of your credit balances to credit limit. This is a measurement of your credit limit that is being used. The lower the percentage the more positive the impact on your score.

Length of Credit History (15%): Your length of credit history is determined by averaging the amount of time all of your accounts have been open. It has been found that generally speaking, there is a positive correlation between the age of an account and a higher credit score.

Types of Credit Used (10%): There are three categories of credit accounts: revolving, installment, and open.

  • A Revolving Account is a line of credit that is based on the amount of credit a person has, with the maximum credit limit set by the lending company. The payments for revolving accounts are variable. (Example: Credit Cards)
  • An Installment Account is a form of debt that has a fixed payment amount and repayment period in which an individual can pay. (Example: Mortgage)
  • An Open Account has a balance that is to be paid in full every due date. (Example: Cell Phone Bills and Home Utilities)

New Credit (10%): New Credit is created when an individual requests an amount of credit in addition to their existing amount of credit. While making a single inquiry for new credit is likely to have little impact on your credit score, opening multiple credit accounts in a short amount of time can signal greater risk to lenders which can in turn decrease your score.

The Significance of Your Credit Score

Credit is connected to many aspects of your life and having a higher credit score can help you achieve your financial goals more easily. For example, having a good credit score can increase the likelihood of the following:

  • Receiving a loan for a car or house
  • Acquiring advantageous interest rates on loans
  • Obtaining credit cards
  • Being more attractive to employers
  • Renting an apartment
  • Paying lower insurance premiums

So, what can you do if you are not satisfied with your credit score? As was discussed above, the two factors dominating the makeup of your credit score are Payment History and Credit Utilization. The best strategies to increasing your credit score, then, revolve around improvements in these categories.

To improve the Payment History portion of your score, it is important to make sure you make all of your credit payments on time. One suggestion you may find helpful is to set reminders for yourself to make the payments or to enroll in automatic payments. Your credit score will rise when you make payments according to the dates they’re due over a long period of time.

To improve the Credit Utilization portion of your score, it is important to make an effort to lower your ratio of credit balance to credit limit. The best way to do this is by paying down your debt. You may also consider contacting your credit companies to see if you are eligible for an increased credit limit. The decision to increase your credit limit should not be taken lightly, however. As was discussed earlier, taking on too much new credit can negatively affect the New Credit portion of your score.

As a final note on this topic, whether or not you are satisfied with your credit score, we highly recommend that you regularly monitor your credit score and your credit report. You can obtain a free credit report every 12 months from each credit bureau: Equifax, Transunion, and Experian. This will provide you a consolidated report of your current credit and it’s history. We encourage you to investigate this report, make sure everything is accurate, and report any inaccuracies to the credit bureaus. Please see our post “A Careful Review of Your Credit Report” for our thoughts on best practices when reviewing your credit report.

Your credit score is tool that can help you achieve life goals. Be sure to evaluate your credit standing and make a goal to increase it if you are not satisfied. Everybody’s situation is unique; therefore, each individual will have a different strategy to raising their credit score. Of course, please reach out to anyone on the Financial Planning team if you have further questions!

Long-Term Care Aware

Financial Planningon February 22nd, 2018No Comments

Written By: Daniel Tripp

Long-term care is defined as the need for assistance with normal activities of daily living for a period of greater than 100 days. Additionally, when long-term care is needed, it is not a one-time need, but rather is a “continuum of care” that starts at home and advances to an assisted living community or nursing home. No matter where one falls on this continuum of care, the costs can be significant. Many financial experts agree that long-term care is one of the most significant financial strains you or your family may face as you age. In this piece, we explore this topic by sharing our thoughts on a few of the most common questions regarding long-term care.

What are the odds of needing long-term care? The reality is that the answer is different depending on which study you reference. One reliable study conducted by the Center for Retirement Research at Boston College estimated that 44% of men and 58% of women will need nursing home care at some point in their life.1

How much does long-term care cost? The factors determining the costs of long-term care include geographic location, the type of care received, and the person’s condition who is receiving the care. In 2016, the average annual cost of a private room in a nursing home was about $92,000, and $82,000 for a shared room.2 The annual inflation rate for long-term care is between 4% and 7% but could increase dramatically as Baby Boomers start to use long-term care facilities.3 Another factor that makes long-term care complex is the uncertainty about how much care you or your loved one may require before receiving a specific health diagnosis. With so many variables affecting long-term care cost, it’s important to start thinking about developing a long-term care plan before you’re faced with an adverse health diagnosis.

How may one pay for long-term care costs, if needed? There are four primary ways to pay for long-term care. They include relying on family, relying on Medicare, using personal assets, and utilizing long-term care insurance.

  • Relying on Family: In past decades, family members often took on the role of caregivers when a person needed long-term care. However, as society has changed, the opportunity to rely on family members to meet long-term care needs has decreased. As families have become smaller, more geographically separated, and have come to rely on two incomes, the ability and opportunity of family members to provide care has decreased. As a result, in the future, paid caregivers will likely be the most common providers of long-term care services.
  • Relying on Medicare: Contrary to popular belief, government-funded health insurance programs such as Medicare and Medicaid do not pay for long-term care, unless your assets or income are below a certain threshold specified by the states. This misconception stems from the fact that these programs will pay for acute care, which is defined as the first 20 days in a skilled nursing home and another 80 days of care on a co-payment basis following a three day stay in a hospital. If a person requires additional long-term care after 100 days, the cost will be borne by the individual.4 Finally, standard health insurance does not provide long-term care benefits. Health insurance plans are designed to provide 100 days of “short-term” care or less following an illness or accident.
  • Using Personal Assets: Paying for long-term care from personal assets is known as self-insuring. Personal assets used to pay for long-term care are typically withdrawn from one (or more) of three places. These include individual savings, retirement accounts, and home equity. There are some advantages to paying for long-term care from personal assets, particularly regarding the quality and location of care received. The disadvantage of self-insuring is that even a short stay in a long-term care facility can have a significant impact on a person’s financial security.
  • Utilizing Long-Term Care Insurance: Long-term care insurance will pay for a nursing home, assisted living, at-home care, and adult daycare. There are many factors to consider when purchasing long-term care insurance. These include the optimal age to purchase insurance, determining whether or not you have enough assets to self-insure, covering other, potentially more pressing, insurance needs first such as health, disability, and life insurance, and determining whether or not you are in good enough health to pass the underwriting process.

What is the optimal age to purchase long-term care insurance? Since your ability to obtain long-term care insurance is a function of your health, the younger you are, the cheaper and more likely you are to be able to purchase a policy. As a general rule, the earlier you purchase long-term care insurance, the cheaper the cumulative cost will be. For example, an individual who buys long-term care insurance at age fifty-five will pay less, over the course their lifetime, than a person who purchases the same coverage at age sixty-five, even though someone at age a sixty-five will theoretically pay fewer premium payments than someone at age fifty-five.3 This is because the cost of long-term care insurance premiums rise as one ages and long-term care insurance is outpacing the rate of inflation.

When should you consider purchasing long-term care insurance? At Yeske Buie, we feel that someone under the age of fifty does not need to consider purchasing long-term care insurance. Individuals between the ages of fifty and sixty, however, should carefully analyze the costs and benefits of buying long-term care insurance. We also encourage individuals in this age group to prioritize additional savings and expenses verse the premium costs of the long-term care insurance. For individuals over the age of seventy-five, it gets much harder to pass the underwriting process, and long-term care insurance becomes prohibitively expensive.3 Unfortunately, insurance companies view older individuals as part of an increased risk pool and are very reluctant to sell long-term care policies to people they consider at a high risk of filing a claim.

What can you do to plan for the possibility of needing long-term care? The following are four considerations to reflect on as you begin planning for your potential long-term care needs.

  • Educate yourself on the topic of long-term care.
    • This includes gathering information on the statistics, demographics, types of care available, and costs in your local area.
  • Evaluate your situation and assess the risk factors you face.
    • This might include realistically assessing whether you have a high longevity risk, or if your family situation prohibits you from relying on care from family members.
    • You should also consider if other family members have needed long-term care for a genetically predisposed condition such as Alzheimer’s or Dementia.
  • Consider the cost of modifying your home so you can age in place safely.
    • When thinking about this cost, you will want to evaluate whether or not you qualify for Medicaid or other government benefits such as Veteran Administration services.
  • Assess your ability to self-insure verse purchasing a long-term care policy.
    • Begin by evaluating the types, cost, and merits of long-term care insurance.

After reflecting on the above considerations, it is important to then discuss your situation with your family, trusted friends, and a Financial Planner. These individuals can help you to write your long-term care plan down and review the plan at least annually.

How can we as Financial Planners help you plan for your long-term care needs? As planners, we’re in a unique position to assist you with planning for long-term care costs. If you or your loved one has been diagnosed with an illness which will likely result in a long-term care need or if you simply want to make a long-term care plan, our team at Yeske Buie is available to assist you in any of the following ways:

  • Supporting you in walking through all the options available to you and evaluating your situation as you walk through your long-term plan development process.
  • Helping you gather the information on long-term options, running cost projections, and assessing your financial situation so you can make informed decisions.
  • Determining your risk tolerance and exploring options for paying for long-term care cost.
  • Projecting the impact of savings and investing in accounting for long-term care cost.
  • Referring you to health experts who can be there to coach you through all the details of setting up long-term care and assist you in avoiding potential pitfalls.
  • Referring you to a reputable long-term care insurance provider, and help you evaluate long-care insurance policies.

Financial Planners are in a unique position to understand your goals, values, and resources and help you find the best solution to address your needs, including your individual long-term care planning needs. Please do not hesitate to contact our team if you have any questions about long-term care insurance or creating a plan that’s right for you.

SOURCES

Olympic Overlap

Financial Planningon February 7th, 2018No Comments

Written By: Lauren Stansell, CFP®

The 2018 Winter Olympics are upon us! This year’s festivities are being held in PyeongChang, South Korea and began (last night) with figure skating and will further kick off with the opening ceremony today. Throughout the two weeks, competitions will be held in a total of 15 sports – from bobsled to ice hockey to alpine skiing –with 102 different events on the slopes or on the ice.

While these sports and events may vary widely with respect to the skills needed to win gold, the Olympics and all events surrounding it happen to align well with financial planning – from the planning and preparation process to the implementation to the monitoring. Read more about the dedication, training, performance, and teamwork similarities between the Olympics and the Financial Planning Profession…

Preparation and Training

Successful preparation for the Olympics includes intense dedication, persistent training, and professional coaching, amongst many other things. Athletes must first dedicate themselves to their sport much like we, as financial planners, must dedicate ourselves to our profession. Deciding to compete in the Olympics is not an overnight decision. It is a long-term plan that athletes choose to pursue and stick to over time. Similarly, Clients must dedicate themselves to the financial planning process which is a long-term process. These forms of dedication may not always be easy – there will be challenges and learning moments, for sure – but in the end, we feel that it is worth the investment of time.

Part of that dedication comes in the form of persistent training – athletes train day and night physically, nutritionally, and mentally to improve their skills, health, and robustness for their Olympic competitions. We at Yeske Buie persistently pursue learning and growth; we embody our values of Learn Big, Think Big, and Be Big to continue on the path to becoming the best planners we can be.

Athletes also seek out professional help, something we feel is our role to fill for our Clients. We want to be similar to an Olympic coach – to provide our best thinking, guidance, education, and support. We want to provide feedback when improvements are needed and be there to celebrate successes with our Clients! Simply put, we want to be part of our Clients’ team.

Performance

As we know, endless hours go into preparing for The Olympics in hopes of winning gold. The Games are now upon us and the athletes are ready for action. It’s time to put the dedication and planning into play. We, as financial planners, are ready for our game – taking Clients through the financial planning process; implementing our Evidence-Based Financial Planning, Policy-Based Financial Planning, Safe-Spending Policies, Investment Philosophy; and more. Although there are many individual facets of our financial planning process and relationships, we think our true value is in the combination of all parts in the execution of a successful financial planning relationship with each Client.

Team Play

In most highly valuing the sum of our parts, our approach is similar to a hockey team, made up of individual players with their own strengths and weaknesses who are selectively picked for the way they perform together as a whole. We view financial plans as a sum of the parts of a Client’s entire life, not just the money.

Likewise, when building our Investment Portfolios in alignment with our Investment Philosophy, we consciously pick the building blocks (mutual funds) for the exposure they give us to each segment of the market we’re interested in. But we don’t pick the building blocks one-by-one, we pick them based on the totality of the ideal portfolio and how well they play together.

And, like an athlete strengthening muscles to avoid injury or adjusting mid-game to better compete with an opponent, or a client setting aside funds for an emergency fund or making course corrections along the financial planning path, we build in resilience:

  • We are globally neutral, meaning we invest in the countries of the world as they make up the world economy.
    • For example, the U.S. makes up about half of the world economy and, consequently, about half of our portfolio allocation. We do not have a home-country bias.
    • That being said, when you’re watching the Olympics, if you are rooting for the United States competitors and teams, you may be exhibiting home-country bias and that is just fine!
  • We have a chunk of most portfolios invested in a stable bond fund that is included for stability in volatile times, not for returns. In retirement, this chunk of bonds is purposefully increased to function as the bridge to weather a downturn for six-to-seven years’ worth of spending needs.
  • And, like athletes in the middle of an Olympic event, we are consistently assessing ourselves and our surroundings for any adjustments that may need to be made, like rebalancing accounts, shifting to lower-duration (and less interest-rate sensitive) bonds, etc.

Financial planning and the Olympics seem to have quite a bit in common and we love finding connections between our profession and passion and the world around us!

The Best of 2017

Financial Planningon December 21st, 2017No Comments

As we enjoy the final days of 2017, we thought we’d reflect on some of the best pieces from TheLiveBigWay® Digest over the past year. We have reviewed the Digest posts from 2017 and we share with you the five most popular posts from each of our categories. We hope you enjoy reading these pieces and we wish you and yours a restful New Year’s break and a happy and prosperous New Year.

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Economy and Investing Posts

1. The Coming Bear Market 2. Yeske Buie Investment Philosophy 3. Is the Stock Market Expensive? 4. Market Note: Dow 20,000

5. 2016 Market Review

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  1. There will be a bear market, we just don’t know when, and nor should we care when, because it will only be a blip to be endured, not a permanent cause for harm.
  2. Learn how we implement our evidence-based process for assembling and managing client portfolios in this 19 minute video.
  3. The next time someone tells you that the “market” is expensive, ask them, “which market?”
  4. The Dow closed above 20,000 for the first time this past January. While 20,000 is just a number, seeing those four zeros excites the eye. But what does such a milestone portend for the future?
  5. From economics to markets to politics, 2016 provided one plot twist after another. As such, we offer a brief recap of what happened in the economy, the markets, and your portfolio, with a nod to the year to come.

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Financial Planning Posts

1. Cash Flow Trackers 2. Reviewing the Benefits 3. What is Wealth? 4. Assembling Your Financial First Aid Kit 5. Back to Basics

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  1. We take a look at one of the more popular cash flow tracking apps, Mint, and give our take on the service.
  2. We share a review of the benefits of renting and buying to consider when pondering this decision.
  3. What is wealth? We explore how the Social Progress Index is trying to redefine traditional measures for quality of life.
  4. Ensure your financial first aid kit is well-stocked for any emergency with our comprehensive checklist.
  5. We discuss the different roles and responsibilities that the beneficiaries (or any interested party) of a trust should be aware of.

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Firm News and Events Posts

1. Yeske Buie’s Live Webinars 2. Yeske Buie Special Events 3. Dave Receives the Profession’s Lifetime Achievement Award 4. Congratulations, Lauren and Daniel!

5. It’s a Boy!

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  1. Our three three live webinars were very popular this year! We hope you will register for our upcoming webinar, 2018 Outlook: Through the Looking Glass, and check out the recordings of this year’s presentations – Will the Trump Administration be GREAT for Your Finances?, Around the World in 60 Minutes, and Housing Transitions in Retirement: It’s Your Move.
  2. We also hosted two events this year featuring guest presenter, Apollo Lupescu, PhD of DFA. Check out a recap of the events here: A World of Opportunity: The Evolution of Investing in Vienna, Virginia and Explore the Possibilities: The Evolution of Investing in San Francisco, California.
  3. In October, FPA awarded Dr. Dave Yeske the profession’s equivalent of a lifetime achievement award, the P. Kemp Fain Jr. award! Congratulations, Dave!
  4. We share pictures of the joyful newlyweds, Lauren and Daniel Stansell, and their loved ones engulfed in wedding bliss.
  5. The Yeske Buie team is overjoyed to share that Yusuf Abugideiri, Senior Financial Planner in our VA office, and his wife Maegan have just welcomed their first child!

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Fun Stuff Posts

1. Perhaps the Most Beautiful Flash Mob Ever… 2. Yeske Buie’s User Manual 3. Where in the World is the Live Big® Glass? 4. The Science of Happiness

5. Can Money Buy Happiness?

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  1. Our good friend Ed Jacobson, PhD, author of Appreciative Moments, sent us a video we thought you’d appreciate. Elissa calls it “perhaps the most beautiful flash mob ever…”
  2. Yeske Buie’s User Manual is an interactive guide to all things Yeske Buie. Get information on everything from client services to “Why YeBu Clients are Elite”.
  3. We have been holding a campaign called “Where in the World is the Live Big Glass?” to show off our Live Big glass from all around the world.
  4. Recent research suggests that consciously expressing gratitude can powerfully enhance your happiness – learn more in this 7 minute video.
  5. We share an article that explores the things in life that bring and sustain happiness and suggests that spending money in more fulfilling ways can increase your happiness.

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Yeske Buie in the Media Posts

1. A New Financial Planning Framework for the Millennial Generation 2. Attracting Talent at Small Advisory Firms 3. Financial Behavior: Players, Services, Products and Markets 4. Ask the Experts: Budgeting for a Wedding

5. Media Download

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  1. Yeske Buie is proud to support Yusuf Abugideiri, CFP® and Russell Kroeger, CFP® in their recently published work to service the next generation of financial planners and clients.
  2. An InvestmentNews article by Liz Skinner shares thoughts from Yeske Buie and other small advisory firms on the difficulties of attracting new talent.
  3. Elissa & Dave contributed Chapter 15 entitled “Psychological Aspects of Financial Planning” to the seventh text of the Financial Markets and Investment Series.
  4. Lauren Stansell provided her thoughts for an article featured on WalletHub.com sharing financial considerations during the wedding planning process.
  5. We share a collection of our networking efforts at the Financial Planning Association’s Annual Conference that attracted media attention.

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Cybersecurity Posts

1. Your Identity: A Force to Be Reckoned With 2. Monitoring, Alerting, Locking, or Freezing 3. Cyber Spring Cleaning 4. Don’t Fall for the Imposter

5. Protecting Your Digital Identity

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  1. Learn more about Yeske Buie’s agreement with IdentityForce to provide identity protection services to our Clients at a significant discount.
  2. Related specifically to this year’s Equifax breach, we share our thoughts on monitoring, alerting, locking, and freezing your information to keep your identity protected.
  3. When is the last time you “scrubbed” your digital life? We offer a cyber cleaning checklist to add to your cleaning initiatives.
  4. According to the Federal Trade Commission, complaints of imposter scams are on the rise. Arm yourself with the knowledge of current imposter scams.
  5. We share our thoughts on the importance of social media identity monitoring and IdentityForce’s new feature that can help protect your digital identity.

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Estate Planning for Animal Lovers

Financial Planningon December 12th, 2017No Comments

Written By: Lauren Stansell, CFP®

When thinking about estate planning, many topics come to mind – like, what property, houses, and cars you own, who will handle the distribution of your assets, and how you will care for your children, grandchildren, and other loved ones. Often overlooked, however, is the care for our beloved, furry companions: our pets. Although you can’t leave money directly to your pets (because they’re legally considered as ‘property’), you can make plans to ensure your pets are cared for and that the necessary resources are available to the caretaker.

Here, we share a few steps you can take to ensure your pets are cared for by the people you choose and in the ways you desire.

  • Identify the person you would most like to take care of your pets if something were to happen to you. Then, identify backup caretakers.
    • By identifying backups, you ensure your pets will be taken care of even if your first choice is unavailable or uninterested in doing so for some reason. Or, for example, if your primary caretaker travels a lot, the backup could take care of your pets when the primary is traveling.
  • Once you choose your caretakers, don’t forget to talk to these people!
    • Be sure the designated care takers are willing to be selected for this role and be sure they know your wishes and desires for how to take care of your pet(s). This is also the time to let them know if you will be leaving specific resources (money) to help them care for your pets appropriately.
  • As your pet’s beloved caretaker, you know best how to care for your pet. Accordingly, it is important to formally outline what the caretaker should do, what the caretaker should not do, and how any funds left for your pet should be spent.
    • Unfortunately, informal plans including “promises” made by friends or family to care for your pet often fail. To truly ensure continual care for your companion, you must put your desired arrangements down on paper and make your designations official. This can be done in one of two ways: via your will or a pet trust.
      • Including Your Pet in Your Will: Instructing for the care of your pets in your will is an easy way to note your desires. But, it may not be ideal — wills may dictate where the pet goes immediately upon your passing, but a will doesn’t have the ability to provide for ongoing instructions and funding for the care of your pets. For example, it may leave $5,000 to the caretaker for the care of the pet, but it does so all at once. There is not a way to leave $5,000, to be distributed only as needed for the pet’s care.
      • Creating a Pet Trust: A pet trust, on the other hand, does provide the ability for a trustee (if different from the caretaker) to dole funds out to the caretaker on a specific schedule, or as needed, and provides the ability to have the trustee check in on the pet’s health, care, and living conditions.
  • As is the case for any estate document, review your choices periodically.
    • Friendships may change; pets come and go; life happens. It’s important to review the designations you make periodically to ensure they align with your current wishes and desires. And if they don’t, be sure to make the necessary updates.

To summarize, estate planning for your pets is best done following these three steps:

  1. Brainstorm your desired caretakers (primary and backup) and your wishes for how to care for your pet.
  2. Have conversations with the caretakers you identify and the family and friends closest to you to ensure they are willing to accept their role as your pet’s caretaker and understand how to implement your desires.
  3. Make your wishes official by including your pet in your will or talking to your estate attorney to create a pet trust. Be sure to revisit any official documents periodically to ensure the caretakers, pets, and desires are current.

And of course, there are often multiple ways to make arrangements depending on your specific situation. So, most importantly, talk to your estate planning attorney to determine the best way to carry out your wishes! We’re always here to help start the conversation.

The Financial Aftermath of a Natural Disaster

Financial Planningon October 19th, 2017No Comments

Content Collected By: Zach Bennedsen

The fires that have ravaged Northern California for the past two weeks are coming to a close but for many, the impact has just begun. Our thoughts are with those who have been affected by or have a loved one who has been affected by the California firestorms or the hurricanes in the southern regions of the country. For those faced with the financial aftermath of one of these disasters, we’ve collected tips from victims of prior firestorms, those in the insurance industry, and fellow financial advisors on what to do next. And, for those who were not affected by the fires, we hope this serves as a guide of preemptive steps to take, should you ever experience your own loss.

Evacuees:

Once you are safe, one of the first things to do is contact your homeowner’s insurance provider. Part of your homeowner’s policy covers for loss of use, which can provide for you to live in a home of like kind and quality, or a hotel, while you are away from your home. You may also be reimbursed for living expenses incurred above and beyond your deductible.

For those who have lost their homes:

While most homeowners have some sort of insurance coverage, the details and depth and breadth of the coverage varies considerably. Here are some specific recommendations for dealing with the loss of a home:

  • Secure Housing Quickly
    • As those who have been displaced look to rebuild their lives, it is likely that housing costs will be high and availability will be scarce as those who have been displaced look to rebuild their lives. Being proactive about securing housing will afford you the best possibility of finding a place that meets your wants, not just your immediate needs.
  • Request Agent Help
    • Your agent or broker is an expert in dealing with these kinds of events. We encourage you to enlist their help early and often.
  • Continue to Pay Your Mortgage and Contact Your Mortgage Lender
    • Following a house fire, you’ll still need to make your monthly mortgage payment. However, you should contact your mortgage company and make them aware of the situation. They may be able to make special arrangements because of your unique situation.
  • Get Organized
    • Many insurance carriers are overwhelmed between the recent hurricanes and fires. When you submit your claim, you will be competing with many other claimants and claims adjusters are only human. To help your claim process go as smoothly and as quickly as possible, it is important to be organized. Most carriers will require lists of damaged/destroyed property to obtain full value and the insurance carriers are more likely to handle an organized claimant more quickly than a less organized claimant. More specifically, an organized claimant will do the following:
      • Keep Notes: Keep notes of all conversations that you have with insurance companies, landlords, contractors, and city and county employees.
      • Be Detailed: For example, stating that you have a “dress shirt” is vague. Stating that you have a “Nordstrom, no-iron, regular fit, blue dress shirt worth $69.50” and including a link to the item on Nordstrom’s website is detailed.
      • Collect Photos of Their Home: Collect pictures of the inside and outside of your home from friends, neighbors and family members that will help you recall your furnishings and personal property.
      • Keep All of Their Receipts: Keep all receipts for expenses incurred during evacuation, loss of use, and items you buy to replace lost items. Use your phone to take photos of your receipts and store them in the cloud. Evernote, Google Drive, and DropBox are just a few resources to store images of your receipts in the cloud and allow you to write notes on the stored images.
      • Document Any Push Back: If issues become unresolved, documented push back or resistance from your Insurance Company is information that can be used to complain to the California Insurance Commission.
  • Understand the Replacement Value
    • Typically, HO-3 policies only reimburse the depreciated value (example a 5-year- old mattress is reimbursed at 20% of cost) and HO-5 policies provide full reimbursement. It is important to understand your policy’s settlement clause and if you don’t understand, ask your insurance agent for help.
  • Communicate via Email Whenever Possible
    • Email is a productive means of communication as it allows you to maintain a permanent, documented record should you need to reproduce the communication as evidence in the future. Of course, keep in mind that email is not considered a safe method of communication and you should never send personal information such as account numbers, policy numbers, birthdates, social security numbers and the like via email.
  • Avoid Using Any 3rd Party Adjuster
    • If it becomes necessary to use a 3rd party adjuster, be aware that their fee is negotiable. Typically, 3rd party adjusters don’t have guarantees and they charge a portion of the total available monies.
  • Ask for a Portion of Your Settlement Up Front
    • If your home has been damaged or is a total loss, some insurance companies will send you 20% right away to help you rebuild your life. As with any large sum of money, it is important to be mindful of how you spend it. As a note, the statute in California for people with a lender on the policy states that any amount over $50k on building property must be issued in the name of the lender and the insured. Furthermore, if there is a mortgage and a line of credit, the check will have three names to cash it.
Advice from Survivors who lost their homes to prior fires:

“The process starts right away – save receipts, they should cover temporary housing. And start looking for a place to live, people will price gouge if there’s a lot of people looking.”

“Accept the help and don’t worry about inconveniencing anyone. People want to help, and to suddenly lose your home and stuff can be pretty overwhelming.”

“Don’t be in a rush to get everything done right away. Except for securing housing we realized after the fact that we would have made better decisions and gotten more insurance proceeds had we waited a couple of months.”

We’d like to extend a thank you to those who shared their tips and recommendations with us, especially our friends at Meritas Wealth Management.

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Making the Most of Music City

Financial Planningon October 19th, 2017No Comments

Summary By: Lauren Mireles, FPQPTM

At Yeske Buie, we believe learning fuels potential. Embodying this company value, the Yeske Buie Financial Planning Team took full advantage of the opportunity to learn from some of the brightest minds in the profession at the Financial Planning Association’s recent Annual Conference in Nashville, TN. The entire Yeske Buie team took over Music City to support Dave as he received the P. Kemp Fain Jr. Award, and used the opportunity of being at the conference to the fullest; each team member attended three to five informational sessions per day during the 3-day conference. Topics of this year’s conference included behavioral finance, health care considerations, millennial needs, helping clients through a divorce, staying secure in the technology age, tax reform, employee development and more.

Reflecting on the experience, the team shared some of their most impactful learnings and the ways that they can incorporate these learnings into their work with Yeske Buie Clients.

 

Charitable Giving Trends: Leveraging Complex Assets to Maximize Impact for Your Clients

Lauren Stansell’s favorite conference session was on the topic of charitable giving trends:

This session was in the very last round of sessions during the conference and it was the most impactful (and entertaining) session I attended! The presenter, Bryan Clontz, CFP®, shared a wealth of knowledge and experience on complex (and sometimes extremely odd) assets he has helped Clients donate to charity. He explained the benefits of using certain types of assets (with large embedded gains, like the appreciated shares some Clients donate to their Donor Advised Funds) and he explained the pitfalls of using other types of assets (i.e. tax complications, inability for the charity to get use from the asset, etc.). This session opened my eyes to how much is possible with charitable giving and how the benefits and complexities can vary in different situations.

– Lauren Stansell, CFP®

Five Industry Trends Reshaping Financial Advice

Ryan Rasmussen and Daniel Tripp, members of our newest class of Financial Planning Residents, both expressed that the session titled “Five Industry Trends Reshaping Financial Advice” was their favorite session of the conference:

I thoroughly enjoyed the “Five Industry Trends Reshaping Financial Advice” session presented by Michael Kitces. This session informed planners of key drivers evolving the profession, and provided strategies for firms to thrive in the midst of change. Michael touched on the advancement of technology, the firm’s ability to differentiate their image, and a transition to working with Baby Boomers, Gen X, and the Millennial generation. The recommendations presented will help me at Yeske Buie adapt and thrive in a profession that continues to change at a rapid rate.

– Ryan Rasmussen

The presentation I enjoyed most while attending the FPA National Conference was “Five Industry Trend Reshaping Financial Advice.” Michael Kitces, a renowned thought leader in the financial planning profession, explored the role of technological disruption during the industrial revolution and made comparisons to the recent changes our society is undergoing due to the digital revolution. Kitces outlined five significant trends shaping the financial planning industry and explained how digital technology is disrupting the financial advice landscape. Michael stressed the importance of embracing digitalization, the need for financial planners to focus on new business models, and how differentiation is key to surviving in a very competitive business environment. Kitces also stressed that the advent of digital technology, far from eliminating the need for financial planners, will enable planners to serve clients more comprehensively and efficiently. He explained how those financial planners who embrace the new digital environment, while finding ways to leverage new technological tools to help clients better, faster, and in a more experiential way, will be the ones to prosper most in the new digital economy.

– Dan Tripp

CyberSecurity Issues in Financial Services: How to Stay Protected

There’s no question that cybersecurity is a hot topic in the financial planning profession and in society at large. Lauren Mireles’ favorite session was a presentation sharing ideas for how to keep your personal information and your Clients’ personal information safe in the age of technology:

The cybersecurity presentation was by far my favorite session. It is my belief that you can never be too knowledgeable in the topic of cybersecurity, especially because the techniques and types of cybercrimes are becoming more and more sophisticated by the day. The session shared examples of common and uncommon phishing techniques to be aware of, best practices in keeping information safe, and training programs for employees and Clients that help reduce the likelihood of a cybercrime. I also enjoyed the fact that the speaker was engaged with the audience and answered questions related to real experiences that firms and Clients have encountered. I feel more knowledgeable in the realm of cybersecurity and I feel more comfortable with my ability to share that knowledge with colleagues and Clients if the need arises.

– Lauren Mireles, RP®

The Leadership Pipeline: Recruiting, Mentoring and Developing the Next Generation

Zach Bennedsen and Ryan Klemm both thoroughly enjoyed the presentation by close friend and fellow CFP® professional, Cheryl Holland, on the topic of leadership development for the next generation of financial planners:

My favorite session would have to be Cheryl Holland’s “The Leadership Pipeline: Recruiting, Mentoring and Developing the Next Generation” presentation. As an aspiring young advisor in this profession, the presentation provided concrete examples of the opportunities that are possible going forward. I appreciated the attention given to a young advisor’s value in a firm and the ways to help develop their talent to better serve their Clients and the firm itself.

– Ryan Klemm

Cheryl Holland’s session on leadership pipelines had so many great takeaways. Cheryl’s firm uses thorough yet flexible timelines to map out an employee’s progression of responsibilities and proficiencies. We’ll certainly be able to incorporate some of her ideas to help bolster Yeske Buie’s own leadership pipeline.

– Zach Bennedsen

NexGen Mini-Talks

With a similar tone to Cheryl Holland’s session on developing the next generation of planners, Yusuf Abugideiri’s favorite session was a crowdsourced session titled “NexGen Mini-Taks”:

My favorite session was the NexGen Mini-Talks. Three young financial planners each had 10 minutes to share their thoughts about important issues the profession is facing. Russell Kroeger, one of our former Financial Planning Residents, spoke about ways to help young clients connect with their future-selves in support of their long-term financial planning goals. Roger Ma, an investment-banker-turned-CFP®, spoke about different service offerings and fee structures advisors could consider when launching a new firm. Brian Kelleher shared his ideas about mentorship and ways mentors and mentees can make the most of the relationship. It’s always exciting to see young financial planners feeling empowered to take on the challenge of furthering the profession!

– Yusuf Abugideiri, CFP®

Modern Day Literacy – More Than Just Words

Financial Planningon September 29th, 2017No Comments

Written By: Zach Bennedsen

How literate are you? If someone asked you this question, you might be offended. The underlying assumption that you are anything but fully literate seems insulting. What if instead, someone asked “how financially literate are you?” That prior indignation might turn to a sheepish shuffling of feet. Books, newspapers, emails, websites – words are all around us. Literacy is nothing less than a survival skill in today’s United States. But what about money? Isn’t that all around us as well? Credit cards, mortgages, auto loans, tax returns, college savings plans, 401(k)s . . . Is financial literacy any less of a necessary skill than orthographic literacy today?

The latest study conducted by the U.S. Department of Education and the National Institute of Literacy (2014) show that 86% of adult Americans have at least basic literacy skills. While many argue this percentage is appallingly low, we can at least say there is not a single school in America that does not teach reading & writing skills. As a nation, we’ve obviously decided that literacy is of paramount value. Can we say the same about financial literacy?

Let’s take a look at financial education requirements in America’s schools. According to the Council for Economic Education, only 20 states require high school students to take a course in economics, and only 17 require a course in personal finance. In a world where money is as important as reading, there seems to be a misalignment. To add another layer, in a study conducted by the National Financial Educators Council, more than half the participants aged 18-24 responded that “money management” is the high-school level course they thought would be most beneficial to their personal lives. Students want to learn about money, but schools are not necessarily offering the courses they crave.

If schools are not covering the basics, who will? Appreciating the importance of financial literacy for all ages, Yeske Buie has a program that provides resources to children and grandchildren of Clients from toddlers to college. Furthermore, we are happy to have a conversation with a child of any age – good money habits can never start too soon.

Since learning should never stop we are always open to helping Clients explore ways to increase their personal financial literacy. From conversations at the office to webinars to Client events, Yeske Buie offers many ways to learn more. After all, Learn Big is one of our core values!

Wrapping up, if you’d like a quick insight into your personal financial literacy, we share FINRA’s Financial Capability Study. Take the quiz, but don’t be discouraged if you don’t score highly – only 37% of participants are able to answer at least four of the five questions correctly.

We’ve shared some of our thoughts regarding a very broad issue today, and certainly have not covered every side of the conversation. If you have more thoughts to add, please don’t hesitate to reach out to us and share!

SOURCES:

“Our deepest fear is not that we are inadequate. Our deepest fear is that we are powerful beyond measure. It is our light, not our darkness that most frightens us. We ask ourselves, Who am I to be brilliant, gorgeous, talented, fabulous? Actually, who are you not to be? Your playing small does not serve the world. There is nothing enlightened about shrinking so that others won't feel insecure around you. We are all meant to shine. And as we let our own light shine, we unconsciously give others permission to do the same. As we are liberated from our own fear, our presence automatically liberates others.” ~Marianne Williamson