One Down, One to Go!!!!

The USA Today recently reported that the total cost of raising a child born in 2013 is $245,340 (not including college!!!).  Financial speaking, kids are a HORRIBLE investment.

As a seasoned Financial Advisor, I say, “who cares.

Life isn’t about numbers. This is easy to forget as we toil each day to provide for our family, save for emergencies, college and retirement.  Don’t let these day to day pressures cause you to miss the joy of being alive RIGHT NOW. Alive and surrounded by the ones you love. In other words, don’t sacrifice the only life you have for a tomorrow that may never come.

Kids are awesome. Sure, they are frustrating, annoying, messy, inconsiderate and all. BUT, to quote my daughter, Emma, “kids are all around amazing people”. She’s right. I can’t imagine life without them.

One of the most exciting (and hardest) parts of being a parent is seeing them gain more and more independence. Our kids are teenagers (Spencer is 18 and Emma is about 17).  Smack in the middle of  the separation stage.  My wife and I have worked to “Prepare the child for the path, not the path for the child.” Spencer and Emma have embraced this and are honest, strong, independent, amazing young adults.

Last weekend, we shipped our oldest off to college. We threw him 5 1/2 hours out of the nest to Texas Tech University.  He is well on his way to graduating from being a M.I.T. (man in training). I couldn’t be more proud of Spencer.


You’re Next Emma!!!!

Emma College Scared


What do you love most about raising kids?

#26 What You Need to Know Before Investing in Real Estate [Podcast]

If you chose to invest in real estate as part of your retirement plan, you better understand what you’re signing up for.

For RentMost “educational” classes, workshops etc. focus on all the benefits of real estate and gloss over the realities of doing it. Buying, owning and operating rental properties is hard work.  This week, I talk with Philip Wetzel about the real work that goes into investing directly in real estate.

Retirement Tip of the Week

3 lessons from Jim Collins‘ books Good to Great and Great By Choice that you can use to make smarter financial decisions.

Screen Shot 2014-08-19 at 4.13.58 PMTwo of my favorite business books are Great By Choice and Good to Great. Last week, I had the pleasure of hearing the lead author of each, Jim Collins, speak. It was awesome.  The lessons learned from his research on what made companies great can easily be applied in managing your financial life. Here are 3 that you should start using today…

  • First who, than what
  • Confront the brutal facts (yet never lose faith)
  • Fire bullets, then cannonballs

Feature Presentation: What You Should Know Before Investing in Real Estate

Investing in real estate can be a good thing-as long it fits your situation, you truly understand the risks and work involved and stay diversified.

There are plenty of workshops, classes, seminars, infomercials systems, etc. out there to “teach” you how you should do it. Unfortunately, they are typically strong on the benefits and light on all the work needed to position yourself for success.  In this episode, I start to give you the rest of the story.

Some of the topics we cover are:

  • Why you need to run it like a business
  • How to do your homework before you buy your first home
  • Why passive real estate investing is not really passive
  • The difference between flipping house and real estate investing
  • The importance of having cash reserves
  • The advantages of being a handyman
  • The advantages and dangers of using leverage
  • Why you need to put 20% down when you buy a property
  • The importance of finding quality tenants
  • How management companies work

Enjoy the Podcast?

Help me out and leave a review in iTunes. 

#25 How to Organize Your Financial Records [Podcast]

My financial records are a mess. Really, they’re horrible.

FilingLast week,  it took me 3 days to find a car title. My records are a mess. It embarrassing. I work so hard to help keep my client’s financial lives in order and neglect my own record keeping.

Need to get organized?

In this episode, I’ll share the framework I’m going to use to get my act together. In fact, I’ve added an Organize Your Financial Records checklist to the Retirement Answer Library.  So, click here, download it and let’s get organized together.

Retirement Tip of the Week

Ever lend money to a family or friend? In my practice, I see this all the time.  We all want to help the ones we care about and, if you’ve done well, you’ll get asked to invest or lend money by someone close. Unfortunately, helping out with loans or investments can be one of the worst decisions you make.

In this episode, I’ll show you how to deal with these requests and a framework for lending money to friends and family that may save you a lot of grief.

How Much Do I Need to Retire?

“How Much Do I Need to Retire?” is the question a lot of us are afraid to ask.  We’re afraid because we think the “number” we’ll be told to save will be impossible to achieve.

Recently I sat down to discuss the question “How much do I need to retire?” with the panelists on the Money Mastermind Show

(Glen Craig, Kyle Prevost, Miranda Marquit, Peter Anderson, and Tom Drake).

If you’re struggling with this question, watch. We discuss creative ways you can plan for retirement while still enjoying life today.

Topics we discuss include:

  • How do I figure out how much I need for retirement?
  • What is the best way to save for retirement?
  • What are the best investments for retirement?
  • How do I set goals for retirement?
  • Why retirement planning is more than just saving and investing
  • Creative ways to plan your life
  • Should you count on Social Security?
  • Why your net worth statement is essential to making smarter financial decisions
  • How do I choose a financial advisor?
  • Long-term care insurance

What is your biggest concern about planning for retirement?



First Name
Tell Me About Your Retirement Planning Experience

Want to Talk About How Much You Need to Retire?

Tonight I’ll be joining the folks over at the Money Mastermind Show to discuss How much you need to retire.


Simple question, right?

We’ll have an hour-long open discussion on how to define and plan for retirement.

You can watch and ask questions LIVE tonight at 9:00 pm CST.

To join the Google Hangout go here. (pretty cool tool, there is video and audio)

To listen to the episode later, subscribe to the Money Mastermind podcast in iTunes




#24 Strategies for Handling Market Corrections [Podcast]

Is the stock market correction here?  In the last week of July the S&P 500 index lost 2.7%. The worst weekly loss in over two years. It didn’t take long for the sensationalist headlines to pop up. Here are two of my favorites.

Warning: That plunge in stocks is just the beginning

3 market warning signs predict 20% stock tumble

Insight: When these indicators flash together, it’s time to sell Market Correction

Strategies to Help You Handle Market Corrections

I’m all about investing wisely for retirement. If you are a trader, market timer, trend follower, etc. you might want to click away. For the rest of you, here are my suggestions to help you invest wisely and sleep better at night.

1. Have a Plan

Sounds simple but most people don’t. They invest based on intuition, emotion and trust rather than facts, process and purpose.  Your plan doesn’t have to be elaborate it just needs to be clear and actionable. It should include:

  • Goal for investment assets
  • Investment timeframe
  • Risk/reward target
  • Target investment allocation
  • Rebalancing policy
  • Communication and evaluation schedule

2. Have adequate cash reserves

More than anything, this may the most practical strategy to weather market corrections. One of the biggest mistakes you can make is  to sell an investment at the wrong time because you need the money. With interest rates on savings accounts near 0%, it is tempting to put all your money “to work”. Don’t. Cash reserves give you the flexibility to weather uncertain times in your life as well as the markets. (in episode #17 I discuss cash reserves). Here are the basics of cash reserves

Emergency fund (3 months to 2 years living expenses) + Expected expenses within the next 12 months=Less emotional decisions

3. Have at Least a 3 Year Investment Timeframe

Anything under a three year time frame is speculating not investing. Investing wisely requires time.

4. Be Well Diversified

Every time I say this I feel like the teacher in the Peanuts cartoons…Blah, Blah, Blah. Diversification and asset allocation help you avoid the trap of trying to pick winners and losers. They position you to participate in the economic growth of the world. That is the point of investing.  The more you try to game the system, the more likely you’ll miss out (Here is a recent episode on investing mistakes).

One thing you can do right now is make sure your allocation is rebalanced back to the target you should have set in the beginning. Over the last 4 years, the stock markets have done quite well. If you haven’t rebalanced to your target you probably have a lot more equities than you originally intended. This could mean you have more volatility than you bargained for. Studies have shown that rebalancing your portfolio regularly helps you achieve better results. Rebalancing Feels bad, but works good.

5. Understand Market Corrections are Healthy for the Markets and Your Portfolio

You’ve heard it said that investing is like gambling. In a sense that’s true. If you invest based on intuition, emotions and the advice of the financial press, you’re just one of the suckers walking into the casino. If, however, you invest based on history, research, process and prudence you are more likely to have the odds of the casino over the long-term. That is investing wisely.

Retirement Tip of the Week

Try it Before You Buy it

Retirement savings golden nest eggYou need to be very careful when you are in the Retirement Nesting stage of life. Retirement Nesting occurs during the 3 years prior to retirement and the 2 years after you retire. This is the time of retirement lifestyle dreams. AND a time when you are susceptible to marketers selling the retirement dream.

The Retirement Nesting stage is a danger zone for poor financial decisions. Don’t fall for the emotional urges to buy an R.V., vacation lot, condo or big toy. They can be great but you need to be certain, very certain, that it is something you will truly use. Just recently, I had to help a gentleman unload a beach condo he purchased on a whim 5 years ago. He lost over $100k on the deal (and only used once). Don’t be that guy. Here are some tips to avoid the same mistake:

  • Do LOTS of research over  a 12 month period before you buy
  • Always pay cash.
  • Rent the object of your desire for the first 2 years to see how much you actually use it. It is easy to rent anything anywhere nowadays.
  • Test drive vacation homes, R.V.s and resorts over the first 5 years of you retirement. It can be great fun and save  you from making a costly mistake.

Resources Discussed

 Like the Podcast? Subscribe in iTunes

#23 7 Ways to Screw Up Your Retirement [Podcast]

The cost of a financial misstep in retirement can be devastating. During retirement it is hard to “earn” your way out of poor decisions. Poor planning or a big loss during retirement can ruin your financial security. In this episode I discuss the most common retirement “screw ups” I’ve seen and how you work to avoid them.

Uh Oh

7 Ways to Screw Up Your Retirement

Having unrealistic return expectations for your investment assets (too high in 1990s, too low in 2007-08)

Crazy as it sounds, in the 1990s people retired thinking they could earn 15%-20% per year and take 10% from their assets for retirement income.

Today, we see the opposite extreme. After 2008-07, people aren’t so optimistic about retirement. In fact, they are down right pessimistic.

Not sticking to a spending plan and reviewing it annually

When you  retire it is essential that you become more intentional about your spending. In retirement your earnings power diminishes. You’ll have less opportunities to earn your way out of poor spending choices.

Set a spending plan and review it annually. This will allow out adjust as your situation changes.

Falling in love with an investment or investment strategy

Real estate; Gold; Rental houses; Tech stocks; Dividend stocks. I’ve seen it all over the last 23 years. Just because you’ve had great success with a particular investment or strategy doesn’t mean it is the be all end all.  Managing assets during your retirement years is more about consistency and protection than stellar returns. The past is littered with “sure thing” investment that have gone bust. Just look at the list above.

Financially supporting/enabling adult children

I’m not sure where the line is between occasionally helping a child out and enabling them. We’ve seen retired parents destroy their financial security by bailing out their children from there poor choices. A good litmus test is to ask yourself: Are you preparing your children for the path, or the path for the child?

Starting or investing in a small business

Starting a business or investing in a new venture is exciting. Be careful. They all sound exciting at the start but most small businesses fail. Retirement is not the time to invest a lot of money in an entrepreneurial dream.

Buying expensive lifestyle toys (vacation home, R.V. or land)

Go ahead and dream big but be careful about spending big money on your retirement toy. It’s very common to see older retirees saddled with debt on an expensive R.V. or vacation lot that isn’t used and worth a fraction of the loan amount.

Sticking your head in the sand when it comes to your financial life

Not being aware and willing to address the financial realities of your retirement is a sure way to screw it up.

Retirement Tip of the Week

Complete your estate plan. Yeah it’s boring and can cause some uncomfortable conversations, but get it done. Please

Tips to getting the estate planning questionnaire done:

  • Don’t try to do it at home
  • Set an appointment with your spouse outside of the house to complete
  • Have your advisor or a trusted friend interview to complete it

Tips for Keeping it up to date:

  • Review it once a year with your spouse and trusted advisor
  • Review the same time each year (like a holiday or annual family gathering)

#22 Invest Wisely: LPL’s Investor’s Almanac: Mid-Year Outlook [Podcast]

This week I speak with Burt White, Chief Investment Officer of LPL Financial. Burt and I discuss LPL’s mid-year outlook Titled: The Investor’s Almanac.

SpringBurt and his team do a great job simply communicating the economic and investing environment.  Their Investor’s Almanac is a great tool to help us invest wisely.  No bold predictions or market calls here, just easy to understand insights you can use to make better informed investing decisions. If you’d like a free copy of their Investor’s Almanac you can access it in the Retirement Answer Library.

In this episode we discuss:

  • how to use investment outlooks to Invest Wisely
  • where the U.S. is in the economic cycle
  • where they see potential risks and opportunities
  • how international markets are not in sync with U.S. markets
  • why you should consider harvesting high quality bonds
  • possible alternatives to traditional fixed income
  • places to find income
  • super themes that should provide a benefit the U.S. economy
  • the importance of turning off the worry factory of financial media

Retirement Tip of the Week:  Designating a Trust as a Beneficiary of an IRA

Last week a client called requesting the beneficiary of his Individual Retirement Account (IRA) be changed to a trust. This planning strategy has become more popular over the last few years. This strategy for IRAs can has some benefits if the ultimate beneficiary is:

  • a minor child
  • someone with special needs
  • a spouse from a second marriage
  • a spendthrift with poor financial skills

The trust can help protect the inherited assets and better control how those funds are used by the beneficiary of the trust.

Be careful using this strategy though. Done incorrectly, the strategy could conflict with IRS rules and possibly create big tax problems. It is important the attorney drafting the trust be familiar with certain aspects unique to inherited IRAs.

Some things to consider are:

  • Make sure the beneficiaries of the trust are people. They cannot be non-persons (like a charity)
  • Consider adding language specifically prohibiting distributions to non-persons
  • Make sure it is a Conduit Trust. It should include language that requires the distribution from the trust to the beneficiaries of the Required Minimum Distributions coming from the inherited IRA.
  • If there is more than one beneficiary, consider having a separate trust for each. This will also each trust beneficiary to use their own age for required minimum distributions

Find the podcast valuable?

Help others discover it by subscribing in iTunes and leaving a review.  I would consider it a great favor.


#21 How to Accept the Worry and Start Planning for Retirement [Podcast]

“I worry”


I talk to a lot of people about retirement. Not only clients but most everyone I meet over age 50.  I’ll always ask them what their #1 thought is on retirement. I’ve learned a lot from this exercise. The most important thing I’ve learned is that people worry about retirement….alot!.

They worry about:

  • all the uncertainty
  • living without a paycheck
  • inflation
  • running out of money
  • maintaining my standard of living
  • my health and healthcare costs
  • being a burden to my children
  • long-term care costs
  • losing money in the markets
  • the economy
  • my country

In this episode, I’ll show you how to come to terms with your worry and the uncertainty about retirement. Once you’ve done that, you’ll be free to build a system to manage through the uncertainty in your life. I discuss:

  • Market uncertainty
  • Economic uncertainty
  • Uncertainty in your life

How to begin to manage it by:

  • Scheduling “little conversations”
  • Using checklists
  • Making lots of little adjustments as your life unfolds during retirement

Building this structure is really what this blog, the Retirement Answer Library and podcast is all about.

Retirement Tip of the Week

The importance of tax diversity on your balance sheet as you near retirement. If you’re within 5 years from retirement, why it may make sense to significantly lower the amount you save in your 401(k) retirement plan.

Resources Discussed

Enjoy the Podcast?

A big THANK YOU to Dean for sending me your kind note, thanking me for the podcast and Retirement Answer Library. So glad it’s been helpful to you. It really means the world to me.