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Clarity Coaching Tips

Here you will find many tidbits of coaching and financial information that often needs to be clarified for most American investors. Some of the information is very basic and in the form of a current market update. Some of the information is timely topics, based on current social political and economic climate. Some of these are strategies, ideas, and concepts that we have picked up through the years and implemented in our practice. Basically a soup to nuts area of information on all things financial.

 

Check out our Clarity Coaching Video Clips and the “It’s Your Money” podcasts for more tidbits that might pique your interest.

Prudence not Prognostication

09/13/2012 by

According to the Wall Street Journal, 21 of Fidelity’s Mutual Funds dumped nearly two million Facebook shares in June, less than two months after this “IPO (Initial Public Offering) of the Century” went public. Over that brief period of time, this wildly anticipated and super-hyped stock plummeted to almost half of its original price.

Do we own, or did we own Facebook shares in any of our investment portfolios? The answer is a resounding NO! As with any new public offering, Facebook does not meet the screening criteria of Dimensional Fund Advisors (DFA), the primary investment company we use in the development of our portfolios. To put it simply, at this stage of its corporate life, Facebook is just too risky for too many of our clients.

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What Would Grandpa Say?

09/05/2012 by

Many of you may already know we are not fans of municipal bonds. In fact, we do not hold any municipal bonds in any of our investment portfolios because we think they are too risky. I bet that surprises a lot of people, especially retirees. My astute, well read, late grandfather would be shocked to hear this, having retired from Ma Bell after 42 years, an old school, buy American, blue chip investor. That’s because many advisors routinely recommend that retirees buy and live off of the income generated by supposedly safe individual municipal bonds.

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401(K) Fee Disclosures Now Required by DOL

07/13/2012 by

More often than not, when I ask a client about their 401(k) fee structure or plan cost, the answer I get is, “There is no cost. My company uses no-load mutual funds. It’s free.”

A survey sponsored by AARP, found that 71% of retirement plan participants believed they did not pay any fees at all. This is understandable, but shocking! That’s because this information is rarely disclosed.

The impact of fees and commissions on your retirement can be significant. This is especially true if your plan selections include variable annuities.

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Should I stay or should I go???

06/14/2012 by

General Motors retirees, they will have until July 20, 2012, to make the big decision!

That’s the deadline, just a little over five weeks away, when more than 40,000 General Motors supervisory and white-collar retirees will be forced to make what could be the most important financial decision of their lives. Should they accept GM’s offer of a lump-sum “buy-out” of their monthly pension checks and thus possibly receive the biggest check they’ll ever get? Or should they continue to receive a monthly pension check when GM transfers their retirement plan to a private group annuity from Prudential?

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Facebook on Wall Street

05/18/2012 by

Facebook! The IPO (Initial Public Offering) of the century! Facebook will “go public,” which means that you can buy its shares just like you can buy the stock of any other public company.

Lots of people who never invested before are calling financial advisors and stock brokers to buy shares, but is this a good idea? Does it make sense to buy individual shares of Facebook for your investment portfolio? A lot of people think so, because they are comfortable and they use the product every day.

The answer to the question as to whether or not you should buy Facebook depends on your objective. If you want to speculate with your money, you may want to take a chance. However, you have to be prepared to take a loss – perhaps a sizeable loss – if you are unlucky and the share price falls.

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Tastes Like Chicken! Smells Like Fish!

04/26/2012 by

Every once in a while, I run into an investor who bought a financial product that, upon reflection, may not have been totally appropriate given the individual’s personal and financial circumstances.

Not that the investment was completely “wrong”, but perhaps a different product or approach may have better met the client’s goals and objectives.

One thing you can do to help keep this from happening to you, is to find out who the advisor works for. I don’t mean the specific company that employs him or her, but the type of company that employs the advisor. That information can go a long way to help you understand whether the financial advisor’s loyalty is to you, or to the employer.

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Main Street Money

03/02/2012 by

My coach is coming to town! Yes, Mark Matson is coming to Happy Valley March 8th, at the Corner Room from 12 – 2PM. He is kicking off his media tour for the public broadcasting special airing around the country, as well, his new book Main Street Money. The book is awesome by the way…only available now through Public Brodcasting pledges during the many broadcasts to be aired (the special is great as well!). Mark will start a multi-city bus tour in NYC March 7th, stopping by State College March 8th, and onto Pittsburgh for a live broadcast during a special airing March 9th. See link for sneak peek of special:

http://www.youtube.com/watch?v=Wc7IjPMoow4

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Bonds: Strategies or Schemes

02/23/2012 by

According to Fortune Magazine, Warren Buffett, the Oracle from Omaha, will soon release his annual shareholder letter pointing out that “money-market funds, bonds, mortgages, bank deposits…are thought of as ‘safe.’ In truth they are among the most dangerous of assets…their risk is huge.”

Further in the letter, Mr. Buffet writes that “Right now bonds should come with a warning label.” Why is Mr. Buffett so concerned about these types of investments, many of which are embraced by retirees in their search for a safe haven for their IRAs and 401(k)s?

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From Deb’s Desk – Insider Coaching

02/16/2012 by

Hope this finds you well. It is that time of year when we are all gathering our tax papers, forms 1099’s, 1098’s, W-2’s, etc… Confusing and hectic time of year but also a good time to review, organize and educate yourselves in regards to your finances.

If what you thought was the best way to handle your finances turned out not to be, when would you want to know? And…if you knew, would you do something about it?

2011-2013 tax reporting changes: What you need to know

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Masters of the Universe: Fund Managers

02/02/2012 by

The truth is, very few money managers, if any, can consistently beat the market.

Larry Swedroe, director of research at Buckingham Asset Management in St. Louis and author explains in the video below how…”Past performance has NO predictive value whatsoever,” Swedroe argues, jabbing at the SEC disclaimer that ”past performance is no indication of future results.”

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You Don’t Know, What You Don’t Know

01/19/2012 by

Hidden Fees! They are all over the place when it comes to investing.

At least once a month, an investor tells me that another advisor offered managed accounts where the one and only portfolio cost would be the advisor’s fee. Often the fee quoted would be somewhere between 1.25% and 2.25%, plus or minus a little bit. That other advisor would say that there are no other costs and that everything else is free or all inclusive and that absolutely no other expenses would apply.

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Why did you leave me here all alone?

01/12/2012 by

“Oh where, oh where has the money gone”? That’s what investors trusting their portfolios to MF Global Holdings are singing right now. $1.2 billion in customer funds cannot be found, and no one seems to have any idea what happened to those investment accounts. You might have seen this in the news.

The president of the now bankrupt MF Global, former New Jersey governor Jon Corzine, testified at a Congressional Committee Hearing on December 13. In his opening remarks, he said:

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Ringing The Old Year Out and Bringing The New Year In—-

12/22/2011 by

As we look at the 2011 year in review, remember that “this too shall pass”. New Year’s Resolutions are about to begin and as we look forward to 2012, make a New Year’s resolution as it relates to your finances. Take the 30 day challenge, look at income needs vs wants and get a “real” budget in place.

Last week, the Wall Street Journal ran interviews with four financial advisors soliciting their outlooks for 2012. Specifically, the Journal asked these sages to forecast which sectors had the most promise and which ones investors should avoid next year.

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ABC…1 2 3 the Rules!

12/16/2011 by

Check out this video of Mark Matson’s appearance on Fox Business last Friday. Mark is the CEO and President of Matson Money, the portfolio management firm we use, as well as my personal coach.

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Bet it all on Black not Red

12/12/2011 by

Last Friday marked the 10 year anniversary of Enron Corporation going bust.

On December 2, 2001, Enron filed for bankruptcy. In the late 1990’s and the very early 2000’s, you could hardly find a growth or a high tech mutual fund that did not list Enron as one of its top 5 holdings. Yes, it was sad when the company tanked, but it was devastating to the thousands of Enron employees who’s 401(k) Retirement Plans were brimming with shares of Enron Stock.

At the time, a little over 60% of Enron employees’ 401(k) accounts held the company stock. About 11% of that was the “company match” portion, but the rest was selected by the employees as a retirement plan holding. And essentially overnight, their plans for a peaceful retirement were shattered.

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