The Max Match, The Max Contribution and the Max After Tax
Prospective clients would regularly tell me they are “maxing” their 401(k)s. Upon closer inspection, I’d discover that they were not maxing their 401(k)s. What were they doing? They were maxing their employer match. This happens often enough that I think it bears explaining. When financial planners say you should “max your contribution to your 401(k),” I don’t think it means what you think it means. (See The Princess Bride.)
Nobody Talks About their Financial Failures
Let me tell you a “not-so” secret: I bought AAPL (Apple) in 2001 at $17. I had a feeling that the iTunes thing was going to be big. And I was right. Yippee for me! Having just come off the bursting of the dot-com bubble and the horror of 9/11, I made a great call.
The Role Of Allies (Part II)
I few weeks ago, I posted What is the Role of Allies? (Part I), wherein I proposed that Allies who are only mentors are coming up short. Continued economic expansion requires that Allies actively identify and recruit more women into senior leadership because, in a world that is increasingly older and female, women’s wisdom and identification with the consumer population is essential for growth.
We Have A False Notion Of Independence
I know I just wrote a little about the notion and costs of frailty risk. But I’m going to force the issue here. My experience with clients is that nobody wants to talk about caregiving and being cared for. (Exception: My mom, Hurricane Jackie, who begins every Saturday morning conversation with, “If anything happens to me….”)
How Can You Say No To Guaranteed(!) Lifetime Income?
There are some crazy and absolutely true metrics about the percentage of clients who, when offered guaranteed lifetime income by their financial advisors, refuse to take the advice. And it’s a high percentage. Since I pride myself on clear communication, I don’t think the challenge, for my own clients, was my failure to describe what it is, what it isn’t, why it’s a good thing, and what are any potential gotchas. I think it’s fear.
The Normal Aging Process And Frailty Risk
It’s hard to imagine arriving at that age where you start a conversation regaling people with your latest doctor’s appointments. Lots of us arrive there, however. Sometimes it’s a necessity, like when a child takes over a parent’s health logistics. But mostly we joke how we’ll never be that person, when in reality, we know, deep down, we are destined to become precisely that person.
Leslie F*cking Jones Wants You To Have Life Insurance
Recently, I drove east from Cincinnati to Saratoga Springs, New York, as I do twice a month; and let me state for the record that I-71 and I-90 are not interesting roads. The trip is much more tolerable when it includes catchup phone calls and audiobooks. This time, my 11-hour pilgrimage called for a weighty tome. A substantial piece of thought leadership.
The Market Is Not A Casino
It’s not our fault that we think of the stock market as a form of speculation. Pundits and consumers alike refer to investing as “playing the market,” as though we’re walking up to a blackjack table, slot machine or roulette wheel. And just like gambling, participating in the stock market comes with risk.
What Is The Role Of Allies? (Part I)
It seems to me that we (still) live in a world where misogyny is the last acceptable bias. It’s crazy to me, growing up being told I could do anything I wanted to, if I wanted it badly enough, to know that my success is a threat to anyone.
Are You Planning Properly For Your Fur Babies?
When I take on a new client, the first activity is to understand their values, their current and desired lifestyle, and assess how closely their cashflow management matches where their hearts are.
Teach Your Children and Grandchildren:
Among the most common refrains I hear from clients is, “We were never taught this stuff in school,” or “My parents never taught me about money.” For most of us, this is a truth-bomb extraordinaire.
Saving For a Fabulous 4th Quarter Harvest
I’m going to take a cue from Avivah Wittenberg-Cox and refer to our lives in quarters. She describes our 3rd quarter as one of becoming and our 4th quarter as one of harvesting. Her goal is to enable us to understand that we are likely going to live to 100, and we need to be conscious that the shape we’re in when we get there is up to us.
Losing The Conventional Wisdom, Part II
I recently read a post by a young finfluencer about something called the “family opportunity mortgage.” No doubt searching for fresh content, she rightfully made the point that it’s possible to use this tool to help your retired parents own a home. The challenge, however, is that the Family Opportunity Mortgage Program has been discontinued, so you can’t go to a lender and ask for one.
When You Live Long Enough, Anything Becomes Possible
Those who have met the Finkel family in person know that we are a small bunch. Long used to being undermined by high shelves and overshadowed by tall, long-limbed folk, we are easy to overlook, literally. But we are loud, and that certainly makes up for what we lack in stature. We are also not slender. I believe a more accurate description for us is “chunky.”
Losing The Conventional Wisdom Part 1:
Among the more pernicious myths of the 20th century is the notion that it’s good to defer taxes because, in retirement, we’ll all be in a lower tax bracket. This is treated as gospel by CPAs and mere mortals alike. We believe that, when the piper demands his due, we’ll be enjoying our financial freedom—retirement—at a discount.
Internal Financial Planner Monologue
A couple years ago, I moved to a largely fee-only financial planning model; more specifically, a fee-first planning model, as my clients would, over the course of a one-year engagement, implement solutions with my team once we had established both trust and need.
Hacking Longevity Bit By Bit
Longevity is the duration or length of our lives. Longevity risk represents how our longevity will compromise our lifestyle. Financial people refer to it as the “risk you will run out of money before you run out of breath.” As a group, we try to prevent ourselves and our loved ones from eating cat food in our 80s. But there is another longevity risk that I want to address, and that is that your healthspan—the duration of that part of your life in which you are free from debilitating illness—won’t be long enough if you don’t take ameliorative steps now.
We Are All In Sales
We’re all in sales. Day in and day out, we sell others on our ideas, recommendations, and our work product. The only difference between salespeople and non-salespeople is how they’re compensated. I’ve looked at sales compensation models and sales contributor success, slicing and dicing it every which way. And sometimes I think the “Hunter” archetype is overrated.
We All Should Have a "Forget You Fund"
A professional colleague felt she needed to ask her husband to use a $5,000 bonus to start her own consultancy. Her bonus. Her income. And she had to ask … her spouse? The issue for her was less about getting permission than assuaging her guilt for using her money on herself and not on her family. (Spoiler alert: Her spouse was completely supportive, so she did it, she’s wildly successful, and she’s never looked back.)
Childless By Choice
I am childless by choice. And that’s probably an important area for Madrina Molly™ to explore, as women without children need to consider how they will spend their later years. For a couple of decades, people told me I’d change my mind one day; that my biological clock would start ticking. It never happened.