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Archive for the ‘Best Of Us’ Category
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Tuesday, April 14th, 2009
If you’re like 80% of the people in the world you don’t have as much in your investment accounts as you did one year ago. Whether you should change Financial Advisors or not, now is a good time to asses the performance of your current advisor and decide if it is time to make a change. I want to make it clear that I am speaking of a Financial Advisor not an Investment Advisor, there are less then 5% of the world’s population that should be seeking the services of an Investment Advisor. The investment markets are not a place for most of us to turn to make money; they are a place for us to preserve the capital that we’ve accumulated and grow that capital at reasonable rates of return. Too many of us lost a sizable amount of our capital in the 2001 Tech Bubble only to loose more in the Sub Prime Bubble because we were working with an Investment Advisor not a Financial Advisor.
The first step in choosing your new Financial Advisor is for you to decide what you want from your advisor. Here are some suggestions:
Help me preserve the capital I have been able to accumulate and grow it at a conservative rate of return.
Help me to live within my means and set an investment strategy based on my needs and goals.
Help me protect my family form the loss of my earning ability or my death.
Help me and my family achieve our financial goals prior to retirement.
Help me accumulate enough to enjoy a comfortable retirement.
Help me assess my need for long term care insurance.
Help me establish and estate plan.
Once you know what you want from your advisor you’ll need to find a qualified provider. As in all professions the first qualification you need to look for is education. Your potential advisors will have a Series 6 or a Series 7 securities license as well as an insurance license and a variable products license. A Series 6 allows them to sell mutual funds and a Series 7 allows then to sell stocks, bonds, options as well as mutual funds. A Series 7 is a more in-depth course of study then the Series 6, so I’d eliminate anyone who doesn’t have a Series 7 securities license.
Seventy percent of the people representing themselves as Financial Advisors stop their education beyond their licenses and their required annual continuing education credits. It’s the other 30% of the advisors that you are looking for. These are the people with initials behind their names representing professional designations. At the top of this designation pecking order is the CFP (Chartered Financial Advisor) designation. A CFP is comparable to a master’s degree in financial planning; it takes three years of study and at least three years of practical experience. To find a CFP in your community go to: (http://www.cfp.net/search) Other designations like the ChFC (Chartered Financial Consultant) and CLU (Chartered Life Underwriter) are focused on specific segments of the financial advisory field. These designations are comparable to Board Certifications in the medical fields, and I personally would not put my finances in the hands of anyone who doesn’t take their profession seriously enough to seek all the education that is available. This search can leave you with a list of three to three hundred depending on the size of your community. I suggest that you check www.BestofUS.com, a website that lists the best of ten professions across the United States. This should help you bring your list down to a manageable number of qualified advisors.
Next go to the NASD (National Association of Securities Dealers) website and look up your short list of qualified advisors.
(http://www.finra.org/Investors/ToolsCalculators/BrokerCheck/index.htm) Here you’ll be able find out your potential advisors work history, license history and if they have had any legal or disciplinary action brought against them. We’ve gone through some pretty tough financial times over the past ten years and a lot of good advisors have been sued, so use this information as a means of asking your potential advisors questions. “Can you tell me what these issues are about?” Now Google your short list and see what you find; you’ll be surprised what you’ll learn.
At this point, you need to sit down with those left on your short list. Here is a list of questions that you should ask.
What is your approach to financial planning? If they don’t address the “Help me” points above their not a Financial Advisor. If they start talking about Managed Accounts, Sector Investing, Momentum, Technical verse Fundamentals, or Option Strategies your talking to and Investment Advisor.
What was your book of business worth on March 1, 2008 and what is your book of business worth today? Can I see supporting reports? Their going to ask to see your finances, it’s fair for you to ask to see theirs and if it’s down more then 25% you’re in the wrong place.
How are you paid? There are only three possible answers here; commissions, asset base compensation, or fees. Most will be a combination of the three possibilities; the one that you want to watch out for is commissions. Commissions can create a conflict of interest. Asset based compensation means as your assets grow their compensation grows or as your assets go down so does their compensation. I liked that it results in a common objective. Fees will involve special work like a financial plan or a research project relative to your specific situation, and that’s fair.
How often will we meet to review my situation? This needs to be at least twice a year.
Tell me about yourself. How long have your been in the business? Do your have any professional designations? Have you had any legal or disciplinary action taken against you? What is your employment and education background? Have you written any books or articles that I can read? You know all the answers, just sit back and judge.
If you’ll follow this process you’ll find the Best Financial Planner for you. You may end up with the person that you’ve been using, but you now know they are qualified to provide you with the service that you need from your new Financial Advisor.
Choosing a Financial Advisor can be as important as choosing a doctor, so do your homework and then take responsibility for your decision. As in managing your health you have to take an active role in the management of your finances; stay involved and understand everything.
Tags: Best financial advisor, financial, financial advise, financial advisor, financial advisors, financial consultant, financial plan, financial planner, financial planners, financial planning, financial services. Advisor, insurance, investment, investment adviser, investment advisor, investment management, investments, life insurance, mutual funds, wealth management
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Tuesday, April 14th, 2009
Last year our government spent $150 billion on a Stimulus Program in an effort to increase consumer spending and hopefully bring our economy back into a growth mode. In fact consumer spending did increase by 5% in May 2008 but most of that can be attributed to escalating fuel and food prices. Those Stimulus dollars that didn’t go to fuel and food went towards flat screen TV’s or other foreign made merchandise resulting in more of our American dollars leaving our shores.
In late 2008 we that tax payers agreed to give the financial industry $700 billion to clear up their bad debt and put them in a position where they could get back into the lending business thus stimulating the economy. We now know that the $700 billion was a drop in an ocean of bad loans and the banks are still in trouble, thus unable to extend credit to others because of their own financial problems. The talk is that possibly the banks need to be nationalized which means that we the taxpayers will assume all of their self manufactured bad loans and our children and grand children will be faced with bring the U.S. banking system back to solvency.
In the past week we the taxpayers stepped forward again to fund a new recovery program with a price tag of $1 trillion. This time we are told that these funds will not go to the banks, they will go to create jobs. This is certainly something that our country needs, as jobs have been leaving our shores for decades only to be accelerated as industry, retail, sales and construction have come to a stop in the United States over the past quarter.
Over the past six months we have recognized that the financial structure of the best capitalistic system know to mankind is failing. It’s hard to understand because of its size and scope, but if you think of the problem relative to your household it’s simple. You’ve been spending more then you’ve been bringing in, you’ve been using credit like you’ve been using water; as if there was no end to the supply. Now the tap has been turned off, you lay off the gardener, the maid, and the cook. The bank is at the door and your cars have been repossessed. What do you do? You get a second job and mom goes to work. Simply put you cut your expenses and you maximize your income.
This is exactly what our government has to do. Cut all the pork out of the federal budget and raise taxes. The budget is being addressed and President Obama says he is going to raise taxes on anyone making over $250,000 per year. This is a start but will not get us out of debt; but there is a way. The Best of the U.S. Tax and Stimulus Program will increase the federal tax on gasoline by $3.00 per gallon, put a $2.00 per pack tax on cigarettes and a $1.00 per six-pack of beer and fifth of whisky. In addition we will shut down the illegal drug trade and the underground economy.
We consume 390 million gallons of gasoline per day, 50 million packs of cigarettes per day, and 21 million gallons of beer per day. In one year a $3.00 gas tax would generate $427 billion a year ($.4.7 trillion in 10 years), a $2.00 cigarette tax will generate $36 billion a year ($3.6 trillion in 10 years) and a $1.00 six-pack beer tax will generate $7.4 billion per year (7.4 trillion in 10 years). This is a total annual increase in income of $447 billion. These funds should be allocated to payoff our debt, and get our nation back on its feet. We could address, national health insurance, we could have the best schools in the world, fund renewable energy research and we could fund cancer, Parkinson’s, and stem cell research.
In conjunction with the increase in these taxes we need fund The Best of the U.S. Tax and Stimulus Program. A $150 billion program offering consumers a free U.S. made automobile that gets 36 MPG or better when they turn in their gas guzzler for destruction. This program would take 7.5 million gas guzzlers off the road reducing fuel consumption by up to 833 gallons per year per auto or 6.25 billion gallons total. This would eliminate our need for 320,512,800 barrels of oil resulting in $45 billion not leaving our country each year; thus the program investment would be recouped in just over three years. The auto replacement program represents 6% of the U.S.’s passenger cars and would reduce our nations overall fuel consumption by 4%, each year the program is in place. The Best of U.S. Tax and Stimulus Program, over 10 years, would reduce our oil consumption by 40%; we currently produce 25% of our need. With the added drilling in Anwar and the Gulf we could be producing 50% of our need within 10 years leaving less 10% needed from offshore; which we could get from Canada and Mexico. These figures do not account for the millions of Americans who would switch to more fuel efficient vehicles outside of The Best of U.S. Tax and Stimulus Program as a result of purposely pushing the price of gas up above $5.50 per gallon.
U.S. auto makers sold 17 million cars in 2007 and sold 11 million cars in 2008 resulting in the probability of bankruptcy for one or more of the three. Under The Best of U.S. Tax and Stimulus Program each manufacture would be challenged to produce a four passenger auto and a six passenger mini van that achieved 36 MPG or better. The winner of the challenge would be guaranteed the sale of 7.5 million vehicles each year of the program. With gasoline selling for over $5.50 per gallon it will be only a matter of time before we are powering our automobiles with natural gas or electricity generated by natural gas rather than coal.
The Best of the U.S. Tax and Stimulus Program will also address national health care. Today only 60% of U.S. citizens are covered by health insurance and yet our hospitals are over crowed. The current health care industry employs 14 million of us and accounts for $2.6 trillion of our gross national product. With national health care, which would provide health care for the other 40% of us, we could easily create another 5 million jobs. National health care is estimated to cost $36 million a year which could be paid for with our cigarette and beer tax. If this falls short we can put a tax on obesity by putting a federal tax on fast food.
The Best of the U.S. Tax and Stimulus Program will also address the U.S. Black Market in illegal drugs and the Underground Economy which results in over $2 trillion leaving our country each year and over $400 million in evaded taxes. By introducing a program that regularly and unannounced changes the color of U.S. currency the incentive to accumulate illegal U.S. dollars will be thwarted; the drug trade will come to a halt and the flow of human traffic across our boarders will reverse directions.
Join me in encouraging President Obama and your Senators and Representatives to adopt The Best of the U.S. Tax and Stimulus Program. Email them this post today!
Let’s take control of our economy, our energy needs and our health care; it’s easy if we have the will power to take control of our lives.
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Tuesday, April 14th, 2009
All too often when we find ourselves in need of a doctor, a lawyer, a dentist, or a financial advisor we turn to the least qualified people for guidance; our family, friends and our other advisors. The fact is that in today’s world the playing field of medicine, law, and finance is changing so fast that the professional who has the good old boy reputation is not the most qualified provider of advice.
In many cases the best is not the guy with the big office and the large staffs with years experience but instead the hard worker with the most current education and information.
Having spent my career in the world of finance it became evident to me that continuing education was as important as years of experience. As we have seen in the past year investment derivatives has drastically changed the world of investments. If your broker was not well schooled and well read you sat with him or her and saw your portfolio shrink on a daily basis while being advised that our banking system is strong and this down turn will not last.
Yet if your advisor had read The Trillion Dollar Meltdown by Charles R. Morris published February, 2008, he could have given you a day by day description of what was going to happen to the investment markets over the following months. Since then the S&P 500 has lost over 35% of it value, City Group has gone from $29.00 to $4.00 per share and AIG has gone from $56.00 per share to $1.00 per share. You and your investment advisor would have understood Credit Default Swaps and how they compounded the problems of the Sub-Prime mess. You could have chosen not to participate in the past years crises.
Thankfully I did read Charles Morris’s book but got caught by a series of unqualified and uneducated doctor’s years earlier resulting in the amputation of my daughters left foot because for fifteen years her doctors misdiagnosed a cancerous tumor in her foot.
The lesson to be learned is to research your professional advice providers. Do they have professional designations, are they in good standing with their professional organizations, do they teach within their profession? In short are they current with the latest information within their field?
I was motivated by my daughter’s question: “Dad why did this happen to me, I’m a good person?” Since my retirement in June 2004 I have worked to find reason for what happened to her. I designed and built a website BestofUS in an effort to help other people avoid the mistake that we made and give some level of guidance on where to look for the best professional in the United States.
We as consumers have to take on some level responsibility for our health, our wealth, and our wellbeing. If we don’t we will continue to be victims.
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Tuesday, April 14th, 2009
I have been spending most of my time the last several weeks working on my website, www.BestofUS.com. I want to redesign the site and build it’s monthly traffic. I feel that BestofUS has great potential to do good as well as generate cashflow.
The Best of The U.S.
www.BestofUS will be redesigned to have a landing page which will direct the visitor to the Professionals Page, the High School Page, and our new page which is under construction: The Smartest of US page.
The Smartest of US is a contest which we anticipating will bring us site traffic of 3000 to 5000 visitors per day. I own the URL SmartestofUS.com. The contest has the potential to generate revenue through an entry fee. The details are being worked out with our attorney.
The landing page will also offer current content consisting of RSS feeds to relative blogs and news. The site will look like WebMD.com or Wellness.com, with the flash screens directing visitors to our listing pages.
All pages need SEO, and SEM work. We need to build our web links with our 63,000 listed professionals and High School student’s social network pages.
With increased site traffic and public awareness we want to build our listing pages business plan around increased professional listing upgrades. We need to offer a monthly or annual payment plan with an automatic renewal. We currently have 63,000 professionals listed with 300 upgraded to include contact information and web link.
We need to market our Best High School Student page through FaceBook and MySpace, and support it through advertising. The page needs to turn into a Social Networking site for the Smartest Students keyed to College Admissions, Scholarships, Competitions, and Intern Opportunities.
Searching for the Smartest of U.S. (Under construction)
OverviewThe Best of the U.S. announces a year long $1 million competition to find the smartest individual in the United States. We will hold twelve monthly competitions starting January 1, 2009.
Participants will be asked to answer 50 questions online in an allotted time of 15 minutes.
Each entry will carry a $10.00 fee; contestants will be allowed to enter as often as they wish.
The 50 questions will be randomly drawn from a data base of over 4,000 questions.
Each month the top 10 scorers will qualify for the semifinals. The 10 semi-finalists will be tested in a testing center to determine the monthly winner. The monthly winner will be paid a cash prize of $10,000 and qualify as one of the 12 finalists.
The twelve finalists will be invited to a central location in February 2010 to be tested and to determine The Smartest of U.S.
The winner and 999 runner-ups will share in the $1 million purse.
Grand Prize = $100,000
1st Runner-up through 80th Runner-up = $5,000
81st Runner-up through 180th Runner-up = $1,000
181st Runner-up through 1000th Runner-up = $500
The top ten monthly competitors and their corresponding scores will be posted on the website everyday.
The top 1000 annual competitors and their scores will be posted on the website.
The competition is open to all residents of the United States 18 years of age or older.
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