The life of Pi

There’s a lot of inspiration in a slice of pie. Much like retirement planning, it all starts with a seed. If you plant the seed early enough and water it just right, it grows into a tree with apples plump enough to sustain you when you need to harvest them. You have to time the apple harvest carefully to maximize the flavor of the apples and their ability to sustain their nutritional value. And then there’s the dough, a perfect blend of two very common ingredients – butter and flour. But, you need to cut that butter into the sifted flour exactly right for the flakiest dough, and only the best bakers can manage that. Most people need a little help. Just like life, you’ll want to add sugar and spice to your pie, and everyone’s preference is different. You have to figure out what proportions best suit you before you seal the crust. Sometimes you need to tweak the recipe to suit your own needs. We can help with that. We’ve been helping people bake their perfect slice of retirement pie for more than 40 years. Happy Pi Day from all of us at Winch Financial. We hope your pie is extra delicious today.

Congratulations to Aaron Bauer, CFP®

Congratulations to Aaron Bauer, an investment analyst and financial advisor here at Winch Financial, who recently earned his CFP® designation. The CFP® designation requires some of the most rigorous standards in the industry. In fact, the Certified Financial Planning board bases its highly selective licensing on what it calls the four e’s – education, exam, experience and ethics. Regarding education, the board requires candidates to complete coursework on financial planning through a CFP Board Registered Program and hold at least a bachelor’s degree in any discipline from an accredited college or university. After completing the coursework, each applicant must pass a 170-question, multiple-choice exam that consists of two 3-hour sessions over one day. The exam includes stand-alone and scenario-based questions, as well as questions associated with case studies. Candidates also need to complete either 6,000 hours of professional experience related to the financial planning process, or 4,000 hours of apprenticeship experience that meets additional requirements. Lastly, and most importantly, each CFP® must maintain high ethical and professional standards for the practice of financial planning, and to act as a fiduciary when providing financial advice, always putting the clients’ best interests first. We’re very proud of Aaron and fortunate to have him on the Winch Financial team.

Sound and Practical Finance tips (SPF 15) for people in their 60’s

With retirement becoming a reality for many people in their sixties, decisions about how much and when to apply the protection becomes the driving force behind many of the financial decisions they make. The following Sound and Practical Financial (SPF 15) tips can help: Understand your full retirement age, which is currently 66 for people born between 1943 and 1954 and increases by phases each birth year after. If you were born anytime after 1960, your full retirement age is currently 67. Your benefits and any applicable spousal benefit will be reduced incrementally if you choose to begin taking Social Security before you hit your full retirement age (FRA). Know exactly what your Social Security monthly benefit will be before you turn it on, and factor this into your retirement budget. According to the Social Security Administration, the benefits an average wage earner will receive is designed to replace about 40% of pre-retirement income. The maximum monthly benefit in 2021 for someone who retires at FRA is $3,113 and the average benefit will be $1,522. Ask yourself if you are ready to retire if this will be your main source of income. It is important to understand that you don’t have to claim Social Security when you retire. If you retire before you reach your FRA, and have other resources that will allow you to do so, you should consider delaying your Social Security benefit to allow that money to grow. This will increase the size of the benefit you will receive each month for the rest of your life. Delaying your payments until your reach FRA will also mean you can leave a higher benefit for your surviving spouse once you pass away. If you are married, you can take one spouse’s benefit early while letting the other’s grow. Sit down with a fiduciary advisor who can run a Social Security analysis on your accounts and offer you some… | Read More »

In the clients’ best interest

We applaud the Department of Labor’s fiduciary rule, which demands all advisers act in their clients’ best interest. That this ruling, which takes effect today, has been so hotly debated speaks volumes about how far the industry still has to go to achieve real transparency. The ruling charges advisors with the task of giving advice in their clients’ best interest. Previous, advisors who did not fall under the fiduciary standard, those selling commissionable products under a broker/dealer, only had to adhere to a suitability standard.  They had to offer advice that was suitable for their clients, but could be in the advisor’s best interest. Specifically, if two suitable products were suitable for a client, but one resulted in a higher commission for the advisor, the advisor was under no legal obligation to offer the lower commissioned product. Today, according to the DOL ruling, all advisors must act with prudence and loyalty.  “Prudence” means the advice must meet the professional standard of care as defined by the Employee Retirement Income Security Act (ERISA).  “Loyalty” means advice must be “based on the interests of the customer, rather than the competing financial interest of the adviser or firm.” Additionally, advisors must charge no more than reasonable compensation. They are also prohibited from making misleading statements about investment transactions, compensation, and conflicts of interest. This includes material omissions as well as material misstatements. We spell these terms out because we believe in them. We value our fiduciary relationship with our clients. We enjoy sitting on the same side of the table with them, and we look forward to doing so for many years to come. If you have any questions regarding the DOL ruling, which will require a little more paperwork for us and our clients but no change in our valued relationship with them, please don’t hesitate to ask.

10 million reasons to hire a fiduciary

Last week the SEC filed an injunction against the aptly named Cavalier Union Investments, LLC, and charged owners Merrill Robertson, Jr. and Sherman Vaughn, Jr. with defrauding investors of more than $10 million. The duo’s astounding audacity offers another example of how essential it is for investors to review their advisor’s credentials before handing over their lifesavings. One click on the SEC’s website would have shown that neither Robertson nor Vaughn held a license to sell securities. Although they promised a diversified portfolio that would yield as much as 20%, they never even sought to invest the money in securities. According to the SEC, the only investments made by Cavalier Union Investments were restaurants that failed in 2014. Yet, they continued to solicit investors. Robertson, a linebacker for the Philadelphia Eagles from 1999 to 2001, capitalized on the connections he’d made as an athlete coming up through the system. Many of his investors were former coaches and employees at the schools he’d attended. In what has the makings of a classic Ponzi scheme, the duo allegedly used the money they collected to fund their own lifestyle and to keep up the pretense that they were successfully investing the money. New money went to investors who wanted to withdraw from their accounts. We understand the nearly sacred relationship between a coach and his or her player and assume this mutual respect earned on the playing field contributed to the unlikely success of this scam. Still, we are surprised that it went on for as long as it did. Retirement accounts represent the single biggest investment of people’s lives, and the one they worked the hardest to achieve. We recommend a thorough vetting process before handing over any assets, beginning with confirming the advisor’s registration through the SEC website. Look for a fiduciary, one who is legally bound to act in your best interests. Ask for references from current clients. Understand… | Read More »