|
Don't miss this month's timely story ideas, direct dial phone numbers, and E-mail addresses of these accessible experts! • USA Today’s #1 Featured Money Manager for Three Years Ends 2002 With Positive Returns in Three Managed Account Categories. • 2003 will be a Stock Picker's Market, a repeat of 2002. • Advisory Firm Protects Client Assets in a Way Diversification Cannot. • Income
Disparities Lead to Planning Opportunities • Expert Predicts LTC Financing Trends. • Partner with Uncle Same to Pursue Your Dream. • The Ability to Successfully Manage Separate Accounts Will Position Advisors to Win Competitive Cases and Retain Clients and Assets. • Other than a Financial Planner, Who Are You? TRURO CAPE COD RENTAL COTTAGE AVAILABLE • SEE
LAST PAGE FOR DETAILS. USA Today's #1 Featured Money Manager for Three Years Ends 2002 With Positive Returns in Two Managed Account Categories. Michigan-based Registered Investment Advisor, Schultz Investment Advisors, Inc., (SIA) announced that its 2002 year-end results in two of its seven publicly offered fee-based managed accounts not only beat nearly all indices--but actually finished in the positive column yet again. SIA was featured December 13 as USA Today's #1 Individual Account Money Manager over the past three years, according to columnist John Waggoner who based his column on Morningstar data. SIA notes that it does not utilize margin, short sales, or purchase metal or mining investments for its clients. Scott Schultz, President & Chief Investment Strategist, SIA, says, "We are pleased and gratified to have our proprietary methodology of investment analysis recognized in the marketplace over such a difficult market for so many investors." SIA's two account offerings that finished the year with positive results are: World Growth +12.01% for 4th qtr. 02-------+1.99% for FY 02 SIA specializes in the management of individual portfolios of Closed-End
Mutual funds for its clients and manages approximately $14 million
in assets.
2003 will be a Stock Picker's Market, a repeat of 2002. Only exceptional stock pickers had a good equity in 2002 and they were few and far between. Choosing undervalued or reasonably priced stocks required a strong emphasis on free cash flow, says Pat Horan, CFP, ChFC, Horan Associates Financial Planning, Towson, Md. "It's all about valuation, maybe a boring story, but one that works. Success last year and this year depends on taking a contrarian approach and buying fallen angels. Temporary mispricing in the market offers the astute investor an opportunity to purchase a good company with a long earnings history whose stock price has been decimated. Some of Horan Associates picks in the last year are as follows: * EDS was purchased at $10 and is now at $19.33 per share, equaling
an 93% increase. Horan says that the company had a liquidity crunch when the commercial paper market dried up, but have recently resolved some of their financing problems, smoothing the way forward. Qwest is a baby bell, says Horan. They have more than 12 million subscribers, and we didn't' think the government would let them go into bankruptcy or interrupt telephone service for such a large part of the country. We originally bought the stock at $8, at 35% below book value, it went to $1.07 and we bought more, now it's back to $5.52. While there is still risk, we believe the dcompany may be on the rebound back to a reasonable valuation in terms of its stock price. *Safeway Stores has a great deal of free cash and cash flow. The
stock was badly beaten down and cheap when we bought it. The days of throwing money at any tech stock and succeeding are over for now. Careful analysis will beat the market now and in the long term. It’s not just stock picking – it is understanding and buying a business at a fair price. Patrick J. Horan, CFP™, ChFC, is the founder and managing partner of Horan & Associates Financial Advisors, Ltd., providing asset management and financial planning for executives and closely-held business owners through management of wealth accumulation and wealth preservation with minimal tax consequences. Worth Magazine recognized Horan & Associates in 2001 as one of the “Top 250 Financial Advisers in America” for the third consecutive year. He can be reached at 800-592-7534 or path@horan-associates.com, www.horan-associates.com.
Advisory Firm Protects Client Assets in a Way Diversification Cannot. The next time an advisor tells you they have an emphasis on safety, you should ask two questions? 1- How do you do it? Peter Bernstein, the famous economist and author, once said "diversification is not a guarantee against large losses, only against losing everything at once." If an advisor claims to add safety through "diversification", then proceed to question 2- How have you done the last few years? Not hypothetically, but real world results. It is easy to say "we try to reduce risk", but another thing entirely to actually do it. Don't allow your advisor to define safety as losing less than the market. Look for someone who defines safety as not losing. By using internal market indicators to measure risk, some advisors know when the probability of making money is in the client's favor, or more importantly, when the chance of losing money is too high. Look for advisors with proven reliability over the past decade in all types of market conditions. PMFM, Inc. uses
technical market analysis to monitor market risk levels, and trend
ratings to measure manager performance. They simply will not hold
a negative trending mutual fund in their portfolios. Period. PMFM,
Inc. Principals are Tim Chapman and Don Beasley, experience investment
advisors with offices just outside Athens, Georgia. Jud Doherty,
CFA, manages the marketing and distribution of 401k Toolbox.
PMFM provides money management services for its own clients,
for the assets held by plan participants in their 401(k) plans,
as well as for the clients of other asset managers. The firm
has a lengthy history of good risk-adjusted performance, and
has preserved the value of client accounts over the difficult
last three years.
Income Disparities Lead to Planning Opportunities for Non-married Couples. At tax time, couples can use their unmarried status to positive advantage in the following three examples: *If you are unmarried and have significant charitable contributions for the year as a couple, the higher income earner can claim those contributions. This allows the higher earner to shift the deductions for those contributions to their individual tax return. * The higher income earner can also pay miscellaneous, deductible expenses (cost of tax preparation, financial planning fees, etc.) for further deductions. * The higher income earner can take the children as dependents, further reducing his taxable income. Note, however that when non-married couples shift mortgage interest deductions and real estate tax deductions to the higher income earner, they may be creating a problem for the lower income earner at the time of death of the higher income earner. At that time, the lower income earner may have to prove that both partners contributed to the purchase and mortgage payments for the house. Individual tax returns that delineate mortgage deductions are part of that proof. Debra A. Neiman, CFP (R) Neiman & Associates Financial Services, LLC, Watertown, Mass., can be reached at deb@neimanonline.com, or by calling 617-744-1816. She is a co-founder of the PridePlanners Association, an organization for financial advisors focusing on the needs of non-married couples.
Expert Predicts LTC Financing Trends. Marilee Driscoll, author of the highly acclaimed "The Complete Idiot's Guide to Long Term Care Planning," sees changes ahead for many aspects of long term care. Here are a few: #1) The evolution of long-term care insurance will move from a product primarily purchased by seniors to a product primarily purchased via payroll-deduction at workplaces ; #2) Major LTC insurance premium increases will scare consumers contemplating coverage. This fact fuels pressure for insurers to offer rate guarantees; #3) State deficits negatively impact people - and facilities - which rely primarily on Medicaid funding to pay for long-term care. Less local care will be available to Medicaid patients as facilities close because of state's growing inability to support Medicaid-only facilities. #4) Reverse mortgages will gain popularity - partially due to their attractiveness as a long-term care funding vehicle; #5) New products will debut to give consumers more options to privately-pay for long-term care: 1. The relatively new life settlement product will get more attention, and 2. New line-of-credit will allow children to finance an elder's care with payments made over time. Marilee Driscoll is author of the only long term care planning book to cover all the ways to pay for long-term care, "The Complete Idiot's Guide to Long Term Care Planning" available IN BOOKSTORES AND on Amazon.com now. The book recently received an enthusiastic "must buy" recommendation from Humberto Cruz, nationally syndicated Gannett personal finance reporter. Driscoll is President of the Long Term Care Learning Institute, Plymouth, Mass., speaks to national audiences (both consumer and financial services) on retirement planning and long term care. She also provides technical long term care training to financial advisors & accountants. 508-830-9975 or toll free at 866-MARILEE (866-627-4533), or md@LongTermCareLearning.com
Partner with Uncle Same to Pursue Your Dream. Make certain you take the most direct and economic route in turning your passion or avocation into an income-producing activity. It is possible to formalize many ventures, thereby allowing you to enjoy tax benefits created by your efforts. Increasingly, individuals are pursuing secondary interests, leveraging core skills, experience, and interests in new directions outside the workplace. The type of activities that can generate tax benefits are diverse: creating new products, developing a new publication for a highly specialized marketplace, or footing the considerable training and travel expenses of a rising young athletic talent in the form of a son or daughter on the amateur circuit. Initial expense outlays associated with building a venture may lend themselves to forming a limited liability company that offers the benefits of partnership taxation, with gains and losses taxed at the partner rather than at the company level. Consult with your tax accountant to make certain that your venture meets the tax code burden of proof. When it does, the pass-through of losses in the early years reduces taxable income at the partner level and thus, the overall expense of building the venture. Dreams come in myriad shapes and sizes. Partnering with Uncle Sam makes great sense. Paula
Chauncey, CFA, Managing Partner of être llc, 617-716-0257,headquartered
in Boston, MA, works with individuals, and their closely held
businesses, to develop and execute wealth-building strategies. pchauncey@etrellc.com. The Ability to Successfully Manage Separate Accounts Will Position Advisors to Win Competitive Cases and Retain Clients and Assets. Industry experts agree that separate accounts will drive the financial services industry’s growth and that the smartest financial professionals will prosper by capturing fee-based assets under management through separately managed accounts. Such accounts are becoming the dominant investment models for emerging affluent investors. In this era, access to “hedge funds” also will expand, as separate accounts and hedge funds are marketed to this affluent target audience of investors through one, professional, coordinated separate accounts process. Advisors must work now to develop strategies that can be used to build strong continuing relationships with high net worth investors who know about the tax and other benefits of separately managed accounts. Not being able to offer these products will stunt business growth in the affluent sector. The new book “How to Build A Successful Business in Separate Accounts & Hedge Funds” by Rich White, from Judy Diamond Associates, Inc., offers advisors a comprehensive “how-to” guide to implement separate accounts management packages for an asset-based fee. Advisors who can do this will be in the best position to win competitive cases, retain clients and assets and see their practices prosper. To have a copy of the book sent immediately, contact Judy Diamond. judy@freeerisa.com or call 202-728-0111. FreeERISA.com is read by more than 140,000 financial professionals monthly including Securities Brokers/Investment Managers, Financial Planners, HR/Employee Benefit Managers, Insurance Brokers, Accountants, Third Party Administrators, and others allied to the retirement industry. The Web site gets 1,650,000 page views per month from professionals using the featured research tools and data.
Other than a Financial Planner, Who Are You? Distinguishing yourself in the marketplace is imperative, especially in a flooded market such as financial planning where 99.9% of all financial planners sound exactly the same -- same services - same fees, same value proposition. In this environment of equally good financial planners how can potential clients tell you apart from your competition? Learn to talk about you – not financial planning – and what you may have in common with potential clients. For example -- you are an avid cyclist who loves traveling. You
tip the competitive scales towards your practice when an investor
(a prospect who happens to love travel and cycling, too) is looking
for a financial planner and finds you. Your similar interests and
lifestyle create a great opportunity and a great rapport. The great thing about financial planning is that if you are any good at all, clients will stick with you – once you have them. It’s hard work and a bit nerve-wracking for an investor to decide whom to choose the first time. They don't want to pick financial planners over and over again. There’s a lot at risk – their money, their future, their security. By sharing interests, you give them even more incentive to pick and stay with you. Investors hire a financial planner to help make the most out of life not just the most out of their assets. Letting people know how you are different, and much more than a financial planner, highlights your uniqueness. However you choose to distinguish yourself, make sure it is authentic to your interests and interesting to talk about (word-of-mouth marketing). You may love cooking, swing dancing, rock collecting. You may be a cat lover, active in the gay community, or speak four languages. How do you want to be known in the next five years? Distinguish your business by letting people know who you really are as a person. Laura
J. Moore, M.Ed., Moore Communications, Arlington, Mass. 781-646-1661 Quaint Cottage for Rent – Truro, Cape Cod Superb, Private Cape Cod National Seashore Location To Editors and Reporters who receive “Trends from Ink&Air”: January is the month for you to make your vacation decisions if you want to have good choices on Cape Cod. I own a small, very charming and quaint two-bedroom cottage in South Truro, Mass. that sleeps four. It is a superb, private, Cape Cod National Seashore location. The closest beach is Ryder Beach - about 1 1/2 miles. This cottage affords the greatest privacy, and is protected visually and from sound by its isolated location. It is 100-feet off of a small, two-lane road, in the woods, with absolutely no nearby neighbors. The location is "olde" Cape Cod. Edward Hopper painted extensively in this immediate neighborhood in the 30s and “The Complete Watercolors of Edward Hopper” includes 25 plus watercolors of the South Truro area. Weekly rates are $800 per week in July and $850 in August. We also rent off-season at lower rates. The cottage is available from Sunday to Sunday and there is No Smoking allowed. We do accept dogs. The Cape is only four miles wide here, so access to pristine ocean beaches is very easy. My parents started building this treasure in 1949. It was then, and is now, a labor of love. Last spring, we completely demolished and rebuilt the 20’ x 10’ kitchen and bath wing (shower only) and installed a new septic system and a new well. Do you lust
for quiet, calm, and beauty when you are on Please contact
my rental agent Sue Peters at Cape Shores Real Estate in Wellfleet.
You can view the cottage at Cape Shore’s web site at http://www.capeshores.com.
508-349-1000. Insist on speaking with Sue.
|