“Sanctuary, sanctuary,” cried Quasimodo, the hunchback of Notre Dame as he ran into the church with the convicted woman Esmeralda to escape the lynch mop who had tried her and found her guilty. Back in the day the sanctity of the church was a safe harbor for those fleeing the law.  Today many of America’s affluent, upper middle class and even seniors in retirement are fleeing taxes. What tax shelters remain can help you keep more of your money. Here are the most popular for retirement. Health Savings Accounts: Contributing to a qualified health savings account is tax deductible, accumulates tax deferred and is distributed tax-free for medical expenses and medical insurance premiums for coverage like disability, health, Medicare and long-term care. The annual contribution limits for 2017 are $3,400 for individuals, $6,750 for married couples and $7,750 for married couples over age 55. There is also a once in a lifetime transfer from an IRA or Roth IRA to an HSA tax free up to $7,750 for married couples over age 55 in a non-contribution year. Roth IRAs: These accumulate tax deferred with tax-free distributions after age 59½. Under the five-year rule you could access part of your Roth   Read more…

Brainstorming is one of the most enlightening exercises in business. There’s nothing like a meeting of the minds to develop a fuller understanding of corporate goals, strategies and tactics. The facilitator needs to know how to turn into the storm to drive ideas and stay away from blowhards that take up oxygen in the room. Ideas must be pithy and to the point. Don’t be surprised that the vast majority of ideas are absolutely insane and can’t be implemented. But the few that survive are generally worth pursuing. There are always more tares than wheat. Serving is part of the building process. Product selling can only go so far. The direct and indirect elements that affect product sales often become the servicing menu items that have marketing magnetism that attract clientele. As an example: Your firm sells life insurance, but that space is overrun with competition. You need to educate your clients, referrals and prospects on the tax aspects, the physiology of underwriting, the distinctions in product lines and planning scenarios that include indemnification, income and inheritance. Those are your differentiators. Unwarranted fears can put the brakes on a company and decelerate growth and decrease profitability. Fear that we’re out   Read more…

The personal touch always out ranks the typical business talking points and lets people know you care. Social media is one aspect of personal publication. The original intent of social media was an environment for friends and family to keep apprised of activities occurring within their community. But it was eventually adopted by corporate America as a high-tech contact tool. Sharing business ideas and concepts on social media is like having your own study group. But, as mind boggling and cool as high tech is, high touch is actually viewed as heartfelt. All work and no play can make your edge dull. Finding life’s balance should be priority one. Placing the fulcrum in the right place between work and play can bring an equilibrium to your practice and family. Workaholics spend their time and health to secure wealth. Everyone needs to strike a balanced lifestyle between their vocation and family. Many businesses have parties, social gatherings and charity events where they participate in their community as a group. It develops a comradery with business associates that brings them together as team, which can increase productivity. A major error that can undermined relationships is placing unrealistic expectations on others especially expectations   Read more…

In the economy of relationships people make mistakes. It’s just part of the price you pay in a partnership. Factoring in a few inevitable mistakes into the relationship equation can soften the blow of a blunder. Being vulnerable and open can help others through their difficulties and challenges. No doubt you will need some grace yourself someday, and the universe has a way of pay back, so sow well. Sharing in the public domain is tricky business. We live in an open society with social media and cameras everywhere. Any post can be an evergreen… forever.  Be judicious in exposing personal issues, politics and religion. Lines get drawn in politics and religion and it’s hard to cross back over to repair a bad posting. It can be detrimental to business when you share too much. Having someone’s back in business is a high value characteristic among partners. It creates a bond, a loyalty that is not easily broken. When someone has been there for you, you need to display commensurate actions that speak louder than words. Unnecessary conversation is almost always counterproductive. Sometimes our additional discussions hurt our credibility. Stick to the meat of the matter and avoid wordiness. Often,   Read more…

Being authentic is often referred to as the approach. This is pretty simple. Be who you are and accept others as they are. The authenticity of connecting personalities, beliefs and points of view can accelerate relationships. Generating a personal touch is a solid business characteristic, but personal politics and religion are often deal killers. Business is business. Professionalism is just good business. Identify Shared Goals and Values. Have you ever heard the statement, “Birds of a feather flock together”?   In life we typically seek out people with whom we share similar goals and values.  How do they treat others? Do we respect them? We cannot always share the same point of view with everyone, but shared values are a must.  It’s ok to agree to disagree!  Learn to compromise and appreciate how people with different goals, ambitions, and viewpoints can enhance your life. Most importantly, learn what they can teach you. Disagreements can enlarge and broaden a partnership. Different points of view can create contrast.  If everyone agrees on everything then you may have inadvertently created an echo chamber and not a sounding board for differing business strategies and tactics. Respect is earned. Developing relationships takes time, dedication, and a willingness to   Read more…

No one wants to spend sweat equity with people who never sweat and have no ‘skin in the game’.  If you’ve been around the block more than once, you know you’ve wasted time and treasure on lesser things. So as a promise to myself and you as well, let’s partner with people who are aligned with our goals. Many partnerships suffer from misalignment. They just don’t mesh. They don’t complement each other. It’s best to recognize it, cut your losses and move on. Successful businesses know their core competencies and market to them. They create a value proposition around them and design a menu of services to develop an inter-dependency with their target audience. If the services or “deliverables” are viewed as a significant benefit to your target audience, it will create a reliance upon you for support, and direction. To be effective and profitable, you will need to strike a balance between spending time and treasure on “givers and not takers”. You only have so much time, resources and money, so choose wisely and keep the phrase “mutually beneficial” at the forefront of your mind. If it’s not mutual, It’s over right then and there. Our business, and possibly   Read more…

In addition to limiting non- systematic risk, one of the goals of creating a diversified portfolio is to provide a more consistent return year in and year out. In the long run, consistency provides a greater profit than you’d achieve fluctuating between some stellar years and some black holes. Diversifying means buying a number of investments within an asset class. No matter how good a blueprint is, it doesn’t guarantee high-quality results. You also need superior construction. In investment terms, this means building your portfolio by selecting a diversified group of securities for each asset class you invest in and ensuring that each security meets your criteria for investing. For example, if US equities are one of your asset classes, you might choose
a number of individual stocks. Or you might diversify by choosing a variety of mutual funds or exchange-traded funds (ETFs) investing in US equities. Diversification within each asset class is essential because it allows you to offset, or dilute, security-specific risks. You can expect securities that share similar characteristics to react in much the same way to specific factors or situations. For example, one of the major determinants of the value of any long- term corporate bond is   Read more…

Variation is a fact of investment life. The asset class that provides the strongest return in one year is likely to be overshadowed the following year—or the year after that. The same is true of asset subclasses. In some years small caps outshine large caps. Other years the opposite is true. By owning both, you boost the potential for greater overall gain. Most securities have two types of risk: systematic and nonsystematic. Systematic risks affect an entire market or asset class. An example of interest rate risk is that almost all recently issued bonds lose market value when interest rates rise. Likewise, currency risk affects all non-US investments, whose return is vulnerable to the changing
value of the dollar against the currency in which the investment is denominated, or sold. And inflation risk reduces buying power when your return on investment is less than the rate of inflation. You can counter systematic risk with asset allocation, creating a portfolio of asset classes that are vulnerable to different risks, not all of which are likely to occur at the same moment. Bonds may suffer as interest rates fall, but stocks often excel. So does real estate. And that low correlation is exactly   Read more…

The term instrument might suggest a trumpet or a scalpel rather than a stock or a bond. Similarly product is more likely to make you think of vegetables or running shoes than of currency. But the terms are used frequently and often interchangeably to refer to both specific investments and to investment vehicles, or mediums for investing, such as unit trusts and mutual funds. Asset class is a category or type of investment, such as stocks or bonds. All investments in the same class share characteristics that differentiate them from another asset class. Each class typically has a number of subclasses of investments whose similarities are even more narrowly defined. For example, small-company stocks are a subclass of stocks. There are nine traditional asset classes, each of which behaves differently enough from the others to merit its own category, and a number of nontraditional classes. Cash Equivalents US Equities Non- Dollar Equities Mortgage Backed Securities Short Term Debt Long Term Debt Non- Dollar Debt Real Estate Precious Metals  Other assets are harder to assign to conventional asset classes, often because they behave differently than their names would suggest. That’s the result, in many cases, of actually straddling two classes. Contributions   Read more…

Like most people, you’re probably investing to achieve some specific financial goals. Your list may include some, though probably not all, of the common objectives that many people share: Enjoying a comfortable retirement requires a vision of your golden years and the lifestyle you’ll lead, as you grow older. Paying for your children’s college education is expensive but can provide a career advantage for your progeny, perhaps for generations to come. Buying a home (or a vacation home) is a primary goal with a down payment and good credit. Building a business cost money. Financing your entrepreneurial spirit may require your own money in the game. Traveling around the world is an exciting prospect for entertainment and self-education. It can be a meaningful opportunity for your family as well. Endowing a chair at your alma mater or donating to your favorite charity Providing financial security for your parents with long term care assistance and eldercare oversight. Enriching your heirs is at the heart of leaving a legacy. Often the impact can be felt for generations. The bottom line is that most people can’t afford to pay for everything they want to accomplish with the income they earn. That’s why investment   Read more…