Finding Financial Peace of Mind …
All The Important Financial Advice You Need On An Index Card

The idea that the basics principles of personal financial success are simple enough to be written on an index card began with the original 2013 posting of the Univerisity of Chicago Professor Harold Pollack’s card on Ezra Klein’s blog at the Washington Post. This concept has recently resurfaced thanks to Christine Benz at Morningstar. You can see photos of both Professor Pollack’s card and Ms. Benz’s card . at the original articles. These advisors find some common themes and some unique perspectives.

The common themes in both index-cards are:

  • Maximize use of tax-advantaged and employer sponsored plans
  • Invest in low-cost, diversified mutual funds

Ms. Benz adds that:

  • Investors should rebalance not more often than annually and only if off-target by at least 10%

In addition, Professor Pollack offers some sound ideas including:

  • Save 20% of your money
  • Pay your credit cards in full every month
  • Require your financial advisors to commit to a fiduciary standard

Real Financial Planning’s Sally Kennedy is a NAPFA member and has signed the NAPFA Fiduciary Oath which requires:

  • Always act in good faith and with candor
  • Be proactive in disclosing any conflicts of interest that may impact a client
  • Do not accept any referral fees or compensation contingent upon the purchase or sale of a financial product

Are Robo-Advisors “Real”?

What do “real” financial planners offer that an automated service can’t?

  • Plenty, proponents argue. Retirement planning in particular involves many complex moving parts—Social Security claiming strategies, tax planning, and the decision of where and how to live, to name just a few—that can’t easily be boiled down into an algorithm. “I don’t see robo-advisers doing very well with that at all,” said Dave Littell, retirement income program director at The American College.
  • What’s more, most digital advisers don’t look at the entirety of an investor’s financial life. They’re not going to advise on an estate plan, insurance purchases, or how to maximize employee benefits, for example. While they handle 401(k) rollovers, for the most part they don’t manage assets in clients’ 401(k)s, even though many Americans hold the bulk of their retirement savings in these accounts.

There is a clear distinction between a financial advisor (robo- or otherwise) who is focused solely on generating an investment portfolio and a “real” financial planner who takes the time and effort to develop a personal relationship with clients and to see the full spectrum of financial circumstances of a family or individual. This is the charter of Real Financial Planning.

23 April, 2013
PBS Frontline: The Retirement Gamble

Finding Financial Peace of Mind …

This is an oldie, but a goodie: Retirement is big business in America, but is the system costing workers and retirees more than what they’re getting in return, asks FRONTLINE correspondent Martin Smith. See the full story here .

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