Categories for Blog

Who’s Picking Up the Tab?

September 27, 2016 9:28 am Published by Leave your thoughts

Have you ever been out to a great dinner, or on a great vacation, or perhaps at a great show, really enjoying yourself, yet knowing in the back of your mind that the bill for this great experience would come due, and it might be a doozy? Think about that experience and feeling, apply it to today’s markets, and ask yourself: how will investors feel when it’s time to pay the bill?

We’re not writing this to imply that a market crash akin to the Financial Crisis is just around the corner; far from it. We see ourselves in a slow-growth world that is a result of the experimental monetary policy by governments and central banks (CBs). They are manipulating interest rates without providing comparable fiscal stimulus to recover from a financial downturn, and as a result, these easy rate policies around the globe have lulled investors into a false sense of complacency.

Just looking at this small sampling of market returns gives us some idea about the effects of the CB’s policy of low rates:

During the period when the U.S. Fed embarked upon its Quantitative Easing programs (QE) and Operation Twist, the stock and bond markets earned much of the total returns since the low of the Financial Crisis. Other central banks, particularly in Europe, chose different paths that focused initially on austerity and had less robust results (e.g. a ‘double-dip’ recession in the U.K.). Across the globe, however, it appears that the ability for continued monetary policy stimulus to drive growth is limited. We are left with stagnant growth levels, negative interest rates in many countries, market uncertainty and growing populist movements that promote nationalism over growth.

Central banks are not united in policy goals, governments and corporations are not engaging in enough (if any) fiscal stimulus, and the world’s growth engine for many years—China—is retrenching and transforming. All of this leads to a suspicion that stocks and bonds are overpriced, particularly on the part of income-seekers driving money into utilities and other high-dividend stocks. This is clearly an important inflection point. We must accept that issues that have become political ‘hot button’ talking points—global trade, immigration policy, tax reform and populism—are perhaps now more important drivers of future growth than furthering the low interest rate policies that have dominated the past seven years.

Investors have asked us, are we worried about a bear market? A combination of several indicators turning bearish would cause us concern, such as much higher interest rates and inflation, an inverted yield curve and stock overvaluation. Recent market gyrations seem to be overreactions at this point; U.S. economic data do not currently predict a recession or an inflationary environment that would require the Fed to quickly raise rates. This does NOT mean valuations are at relative discounts—low rates are pushing some investors to equities, and areas such as utilities will be the first to sell off as rates move.

We’re seeing a lot of investment suggestions for private equity, private or second-market debt funds, real assets and options-hedged equity products. All are expected to provide better risk-adjusted returns than conventional stocks and bond portfolios. Our evidence doesn’t support many of these ideas. As we learned eight years ago, and can see in the table above, the traditional relationships between stocks and bonds provides the insurance and low correlation we need. In times of crisis, U.S. Treasurys and public-market liquidity (such as U.S. large-cap equities) are the prized investments.

Our clients know, too, that we preach diversification, patience and a focus on the far horizon, not the next step. The market data we review indicate that the U.S. economy is still healthy (but not robust), and few signs of the high rates, high inflation, excessive stock valuations or a recession are present. We expect some volatility in the period ahead, but our long-term growth outlook remains positive.

Are Your Politics Influencing Your Investment Strategies?

August 31, 2016 8:21 am Published by Leave your thoughts

Whether you’re in the Trump or Hillary camp—or for the possible candidate in between—some have been asking, ”Are there financial strategies to take to protect your investments before, during and after election day comes around?”

We understand that it’s fun to banter with your friends around the dinner table about the merits of this or that candidate, what’s even more interesting is to examine how investors react to political change. Behavioral researchers have found over the years that if an investor’s favored candidate becomes elected, the investor experiences an increased market confidence and tends to take on more portfolio risk. Conversely, if the candidate-of-choice loses, investors expect fallout from the new administration and look for investment safety. 

Take the recent Brexit vote for example. Investors needed to be prepared for market risks if the vote went either way. Thankfully it didn’t create the significant market losses many predicted, but the impending vote had people on edge for a bit.

In the case of the U.S. presidency, researchers from the University of Miami, Brigham Young University and the University of Colorado at Denver conducted a study on how politics impacted investor behavior, reviewing three presidential-election years from 1991 through 2002.

Their behavioral research found that after the 1992 and 1996 elections when Bill Clinton won the presidency, Democratic voters tended to invest more in domestic stocks and to stay invested for a longer time. Conversely, Republicans felt less confident at that time about the economy and invested in foreign stocks and traded more frequently.

Then when George W. Bush won the presidential election in 2000, Republican voters did the same thing the Democrats did when their party representative was in office—they took on more risk, invested in domestic companies and traded less frequently.

The outcome from the researchers’ study was that both Republican and Democratic voters seemed to be influenced more by their political beliefs to help guide their investment choices than by listening to the logic and the advice of a financial advisor.

Voting—like investing—is a very personal act. And there’s no right or wrong way to cast your vote. The only thing that’s certain is it’s going to be quite a journey leading up to November.

The takeaway from studying investor behavior during election seasons is identical to why many investors fail to achieve reasonable returns…their own behavior is their most significant risk. We believe that investors who have a “true” diversified asset allocated portfolio will experience the variable returns from each asset class. Don’t be swayed by popular opinion or what you hear from the media about a certain candidate’s platform to make immediate portfolio changes.

Your financial situation is unique and needs an individual review to cover all potential scenarios. No matter what is happening in the world, a solid financial strategy should have the foundation of objective analysis. Whether you lean toward the Republican, Democratic, Independent—or any other political philosophy—our role is to help you create a solid financial plan.

Five Common Financial Marriage Mistakes to Avoid

July 27, 2016 9:54 am Published by Leave your thoughts

“Till death do us part” has now been replaced with “till debt do us part.” Therapists, divorce lawyers and financial professionals often cite money issues as a main contributor to the demise of a marriage. But it doesn’t have to be the case.

While everyone’s situation is different, there are some common financial issues that can derail a relationship.

1. Opposing values

If one partner wants to acquire a lot of possessions or live a certain lifestyle—expensive cars, the latest fashions, luxurious vacations and regular visits to the top restaurants—and the other partner prefers a more toned-down existence, then there may be areas of conflict. It doesn’t matter how much net worth you have—materialism can decrease happiness.

Researchers at Brigham Young University and William Patterson University found in a study that in one in five of 1,734 couples, both partners admitted a strong love of materialistic things. While these couples had financial means, money was often a bigger source of conflict for them. Not surprisingly, these couples were rated at the bottom of the survey’s happiness scale.

2. Not seeing eye-to-eye about money

This differs from values, as it’s more of a day-to-day allocation of funds. According to experts, foolishly spending money is the number-one financial cause for divorce. Of course, “foolish” is a matter of opinion.

Some spouses may want to save to meet goals such as paying for college, buying a second home or investing in a business. While others believe that spending money on hobbies such as gambling, restoring cars or remodeling homes is a good way to relax or to increase income. The take-away is to decide what amount of money you, as a couple, are comfortable allocating toward discretionary spending.

3. Maintaining traditional relationship roles

Gone are the days when women turned the earnings and financial planning responsibilities over to their partners. Many women earn more than their husbands; some wives—or husbands—choose to delay an income to care for their children.

The bottom line: Someone in the household is usually more predisposed to managing financial matters—and if no one is, consider working with a Certified Financial Planner. There are also many online tools you can use to help keep track of your finances.

4. Having different money philosophies

Often in a marriage, one is a spender and the other is a saver. It’s not a deal breaker, but these differences can cause tension in a relationship. It is not uncommon to see financial opposites gravitate toward each other.

Recognizing this and consulting a neutral third party can help alleviate tensions. Perhaps it means allocating a certain amount for the spender to have each month and an amount that the saver feels comfortable with, as well as a common fund that the couple contributes to that meets mutual goals.

5. Neglecting to plan

As John Lennon said, “Life is what happens to you while you’re busy making other plans.” Things happen—and sometimes you look back and wonder where the years went.

Marriage, kids, houses, businesses, caring for loved ones, health issues—no one is immune from life’s challenges. Which means having a plan as a couple—from the day you say “I do” is key. If you have significant assets, consider a prenup from the start. If you forgo a prenup, consult with a financial planner to develop a roadmap for moving forward.

Money is a difficult subject for most people. Combining funds, philosophies, and spending and savings habits can add to the pressure. Whether you’ve been married for decades—or are simply contemplating marriage—consider professional advice about how to make a financial plan that you both can agree upon. Talk to us today about how to develop a personalized financial plan that meets your mutual goals.

JJ Burns & Company Acquires Emmes Wealth Management

July 11, 2016 9:28 am Published by Leave your thoughts

Melville, NY – Nationally recognized wealth management expert JJ Burns announced this week that the company he founded has acquired Syosset-based Emmes Wealth Management. Emmes founder and CEO, Barry Goldberg, will join JJ Burns & Company as a Director. The acquisition represents a significant step toward JJ Burns & Company’s long-term strategic plan of building a leading wealth management team. 

Founded in 1994, JJ Burns & Company focuses on comprehensive wealth management based on an individual’s unique vision and goals. This boutique, high touch approach to planning incorporates all areas of your financial life including retirement planning, investment management, estate planning, and legacy planning. With the acquisition of Emmes Wealth Management and the joining of Barry Goldberg to the team, it gives JJ Burns & Company more time to focus on their mission of making a meaningful difference in the lives of the families they work with and their strategic partners.

“We serve our clients with openness and unparalleled attention to detail,” explained JJ Burns, CFP®, CEO/President. “And we’re excited that Emmes Wealth Management embodies those same principles that JJ Burns & Company is known for. Barry’s expertise and shared values formed the foundation of this acquisition.” 

Emmes Wealth Management was built on the principal of taking a whole life view of clients’ financial situations and providing broad-based, integrated strategies. “We are excited to join JJ Burns & Company. Their team planning approach, analytical and evidence driven investment strategy, and powerful client service model will enable us to provide even more value to the families we serve,” said Barry Goldberg.

Going forward, Mr. Goldberg will continue to manage his base of clients while becoming part of strategic business development initiatives and strategic partnerships at JJ Burns & Company.

About JJ Burns & Company

JJ Burns & Company is a leading wealth manager for high-net-worth individuals and families. As an SEC-registered independent Registered Investment Advisor, the company is a fiduciary advisor making recommendations that are solely based on the best interests of clients. JJ Burns & Company uses a team approach with a focus on fostering long-term client relationships. The company works closely with other professional advisors to develop a holistic plan covering every aspect of a client’s financial life. For more information, visit https://jjburns.com.

Women’s Finance: There’s a Difference?

June 29, 2016 9:53 am Published by Leave your thoughts

It’s not that women are from one planet and men are from another. It’s just that women tend to end up with different life circumstances than men. Top that off with lower salaries, and there’s a greater need for taking a closer look at financial strategies.

In my 25 years’ experience serving women clients, I find that they can multitask far more than men. They make the family’s social plans, maintain relationships, take care of kids, parents and in-laws—all while juggling their careers. This presents enormous challenges to their time.

It’s true that women control about half of household finances. That means they are watching the bank account, paying the bills, making large purchases, putting something in the savings account, and paying off the credit card.

But they often don’t understand the inner workings of investing. Some of them do, but they just have a lot on their plates. Looking from the outside, investing can appear to be a world of complicated strategies and men making deals.

Seeing Things Another Way

Of course having kids changes everything—finances and all the other aspects of your life. But even without kids, women can have cultural biases toward money, who handles finances, and how to save.

When attending financial workshops, our firm has noticed many men often ask about the best tips for investing. Many women, however, ask about balancing saving for retirement, sending the kids to college, and taking care of elderly parents.

They want to enjoy life while their kids are younger. Women feel some of the most precious gifts are right now in the present.

We often see men wanting tips on when to buy and sell. Women want to know how to support their daughter who’s moving home from college, and their elderly father who needs assistance to stay in his home a few more years. They wish to live a richer life, and at the same time successfully manage the relationships that are important to them.

Saving More, Having Less

Women tend to save a larger percentage of their salaries. They also contribute to their 401(k)s in greater numbers than men.

Despite putting more money away, we often see women ending up with less at retirement.  Salary disparities can take a toll on investing over the long run.

But for those women who started saving early, the benefits of compounding can help make up some of the difference in the total amount saved.

Life Happens

We have found women who have children might take some time off during pregnancy or after the kids are born. For some families, they’ve had to make the difficult decision of balancing childcare vs. going back to work. Re-entering the workforce can often lower wages and position.

When parents get older and need help, women are often the ones to take on the added responsibility. When kids are also in the mix, that makes those women part of the “sandwich generation.”

Life expectancies are increasing for men and women, but women still tend to live longer. That means women need more money for living out their retirement dreams.

Women also are usually the ones initiating divorce. They’re willing to be on their own, and want to know what they can get for themselves and their children, and can they be happy with that.

Risky Business

Getting help from a professional can help in many situations. Developing a financial strategy is one.

Women are often not as comfortable taking risks with their investments. Sometimes this is because they view money a little differently than men. Other times, they haven’t spent as much time learning about investments.

It’s been our experience that women often take fewer risks with their money. They want to remain in a position of control. They might not mind our assistance, but they want to feel in charge of the situation. Circumstance like being in debt can weigh heavily on a woman’s conscience. She might feel like she needs to get that paid off before taking what she could perceive as the risk of investing.

It can be easy to let a husband take care of the household finances. It can be nice to let someone do the worrying, researching and planning for you. But if something happens and he is no longer there, some decisions will need to be made—and that will fall on her.

Worry More, Plan More

Many women have more control over the well-being of the family. This can make them worry more about finances. The balancing act of life can fall heavily on women.

Seeking advice from a professional can help teach her about investing, planning for retirement, and even saving for the kids’ college education. Seeking help from someone who has been trained can help alleviate uncertainty in many situations—whether the advice is from a financial advisor, lawyer, or accountant.

Getting help from the pros can help women feel like they are placed back in control. They can learn about investing strategies, plan for contingencies, prepare for retirement, set goals, and balance all the financial elements of life.

Despite often being good planners, we’ve seen many women don’t seek advice until something major happens. But once they engage our help, they tackle the plan like the other aspects of their life.

Someone “Gets” Me

You’ve decided you’d like to talk with a financial advisor. Don’t be afraid to ask them questions. When you start your search, you want to make sure it’s a good fit. When a match “clicks,” you feel more confident and ready to take what comes your way.

Don’t be afraid to explore how your relationship with an advisor would work. You may want lots of contact or just a little. You may want your financial advisor to give you a couple of choices to choose from, or a wide range.

See how comfortable you are with the way they explain things to you. Are things clear, or do you need more information?

You are building a relationship, and not just with an advisor but also a team. Make sure it feels good to you. It may be one of the most important decisions you make regarding your family’s future.

Brexit: What It Means For You

June 24, 2016 1:35 pm Published by Leave your thoughts

In an expectedly close but surprising vote, the U.K. has completed a referendum to endorse a withdrawal from the European Union (EU). Today’s market reactions are the usual result from market uncertainty around economic issues—sell-offs in “risk assets" such as stocks and currencies and a flight to quality in “safe-haven” currencies and bonds (e.g. the U.S. dollar and Treasuries). Early analysis of the results indicates, however, that the LONG-term results may not be as severe as feared.

HERE’S WHAT HAPPENED

U.K. and Commonwealth voters, by a slim margin, voted to leave the EU. Prime Minister David Cameron immediately resigned, and a new government will be installed in the fall.

WHAT HAPPENED IN TODAY’S MARKETS?

  • Stocks and other assets such as currencies, have sold off around the globe. The U.K. and other EU countries have been hard hit, while the U.S. decline has been muted. Leading up to this, the global markets were rebounding over the last couple weeks.
  • The U.S. dollar and Japanese yen have strengthened; the Euro has declined a bit, and the sterling has substantially declined against the dollar.
  • There has been a flight to quality in bonds, particularly U.S. Treasury Bonds.
  • Gold has been priced up, while oil has declined.

WHY WERE MARKETS VOLATILE?

  • Many believed that Britain would remain in the EU and short-term traders made heavy bets in currencies and other “risk assets.” In fact, markets rallied into the vote as the DJIA was up over 250 points yesterday. Interest rates were moving higher.
  • The markets were surprised once the votes were tallied and markets reversed their trend, giving back most of these gains. The behavior was violent as Britain leaving the EU is a significant event. 
  • The U.S. markets declined as the thought process that European companies are trading partners of the U.S. This could be negative for some businesses.

WHAT ARE THE LONGER-TERM EFFECTS?

  • Britain represents 4%-5% of global GDP. Net results may not be that significant. 
  • The U.K. will need to implement policies to provide liquidity and ease interest rates. 
  • The sterling will fall, U.K. inflation will increase due to increased import prices, and U.K. GDP will likely decline in the near-term. A recession is possible in Britain.
  • The U.S. will be relatively insulated. The Fed will likely delay interest-rate hikes.
  • Global growth may be affected to some degree. This event is not a ‘Lehman moment’ that accelerated the global Financial Crisis. As one pundit noted, “…markets adapt. Policymakers adjust.  Businesses will change course while they continue to seek profits. Prices will reset. Opportunities will emerge.”

WHAT SHOULD BE DONE IN MY PORTFOLIO?

  • Our principles of portfolio construction are based on each of our client's unique personal goals. Their plan is well thought out and balanced by diversified asset allocation. 
  • Changing your portfolio based on a reaction to market events rarely leads to productive long-term results. 
  • All of our plans are built upon the certainty that we will go through negative events and market fluctuations.
  • All of our portfolios contain an anchor of high quality bonds and bond funds, which help to limit declines in significant market events, and did so during the Brexit vote today. Our bonds are doing exactly what we want in uncertain times. 
  • We expect short-term stock volatility and will be partially offset by bond and commodities gains. Today’s market moves are short-term reactions, and most currency and bond markets have moved in orderly fashion (i.e. no extreme drops). And, as our pundit notes, “The long-term political, economic and financial repercussions of the ‘Leave’ vote are incalculable at this point.” 
  • While the Brexit vote has been surprising and unsettling, most of the effects will be felt in the U.K. and Europe. We don’t see any required portfolio moves at this point; most of the trading is just that—trading. Long-term investors should stay focused, and we’ll update you as events progress.

As always, if you have any questions or wish to speak to us directly please feel free to call us.

How Brexit May Affect Your Money and Investments

June 22, 2016 10:21 am Published by Leave your thoughts

Securities markets around the world have been reacting to the politically charged environment in the U.K. over the fierce debate about whether it should leave the European Union. A so-called “Brexit” referendum vote will be held on Thursday this week. British citizens 18 years of age and older, citizens abroad who have been registered to vote in Britain within the last 15 years, and residents of Britain who are citizens of Ireland or the Commonwealth (53 countries) are eligible to vote.

A vote in favor of leaving the EU would likely trigger further volatility in stock, bond and currency markets around the world. U.S. stocks already proved they were sensitive to the situation in the U.K. when they gapped down at the opening two Fridays ago after a poll conducted by The Independent suggested that 55% of Britons were in favor of a Brexit. The result surprised many investors, and the murder of Minister of Parliament member Jo Cox last week by a man shouting “Britain first!” stunned people around the world.


Candlelight vigil in London for Jo Cox

During the mourning of Minister Cox, tensions eased and additional polls were conducted, many of which suggested that The Independent poll was inaccurate. One betting shop put the odds of the U.K. leaving the EU at just 27%, or about 1 in 4. If accurate, it appears that the conservative groups that support leaving the EU will not have enough votes.

Nonetheless, we find it interesting that the U.K. is dealing with many of the same political issues that are being hotly debated in the U.S. presidential election. Jobs, immigration, and reclaimed sovereignty are the main issues for Britons who favor leaving the EU. These issues are very similar to the “Make America Great Again” slogan of the Trump campaign.

The global boom over the past two decades has eliminated many manufacturing jobs in both the U.K. and U.S. Meanwhile, immigration into both countries has caused concerns for conservative groups ranging from perceived increased competition for domestic jobs to increased healthcare costs and a threat of terrorism. The long-term effects have resulted in rising wealth inequality and chronic under- and unemployment among the middle and lower classes in both nations.

On the flipside, many voters in the U.K. appear to be supportive of remaining in the EU, as do most independent economists and large corporations. If history is an accurate guide, the referendum vote this Thursday could be similar to the last referendum held in 1975, when Britain considered leaving the European Economic Community. Back then tensions were running high as well, but more than 67% voted to remain. That’s an indication of how difficult it is to change the status quo.

Regardless of Britons’ EXPECTED intentions to remain, it’s important to be aware of market risks that could develop this week if the vote goes the other way. U.S. investors are clearly in favor of the U.K. remaining; that’s why U.S. stocks surged on Monday after many news outlets suggested that the votes to remain would significantly outnumber votes to leave. That said, market risk would likely surge if U.K. voters decide to leave the EU. The reason is there are many more unknowns associated with Britain leaving the EU than there are for remaining. Also, risks to GDP in the U.K. and the EU after a vote to leave have been estimated to be as low as a 3.2% decline within the next few years before moderating in the next decade.

In fact, the governor of the Bank of England said the prospect of a Brexit is “the biggest domestic risk to financial stability because, in part, of the issues around uncertainty.”

It has been estimated that negotiations about how the U.K. would divorce from the EU will take up to 2 years. Ironically, some of the most disliked EU economic policies may end up remaining in force in the renegotiated trade and economic treaties with former EU partners.

Some influential business people still believe that leaving the EU is a better option than remaining. Edward Atkin, one of Britain’s most successful manufacturers, was quoted by The New York Times as saying, “Customs duties are completely irrelevant compared to fluctuations of the currency.” Interestingly, most economists believe that a Brexit could be devastating for the pound. They also believe that it would take 10-15 years to recover from leaving the EU.

Regardless of how the referendum turns out, we believe that investors who are diversified in long-term strategies will experience some volatility in their portfolios in the short term. If voters decide to remain in the EU, we wouldn’t be surprised to see stocks around the world enjoy a relief rally. Deutsche Bank provided this handy chart to help illustrate how currencies, interest rates and stocks could respond after the vote.

We are also interested in how this week’s referendum affects the Clinton and Trump campaigns and other conservative movements in Europe. This may be the subject of a follow-up post.

How to Choose a Financial Advisor: 8 Questions to Ask

June 16, 2016 8:38 am Published by Leave your thoughts

Whether you're beginning to plan for your financial future—or have found yourself smack dab into making significant decisions that you didn’t anticipate—at some point you’ll need to consult with a financial advisor. However, it can be difficult to always know who the best person is to trust your finances to.

Choosing a financial advisor goes beyond working with someone who has the backing of a large brokerage firm or an impressive list of credentials behind their name. When you look around, there are a lot of alphabet-soup designations out there. Anyone can call themselves a financial advisor, but that doesn’t necessarily mean that they are highly qualified to advise you.

What to Look for in an Advisor

Professional credentials do not tell you everything you need to know about an advisor. You should also look at an advisor’s experience, investment style, and type of clientele. Use the following questions to help you in evaluating an advisor.

  1. What are your qualifications? Advisors must be registered with the Securities and Exchange Commission (SEC) or Financial Industry Regulatory Authority (FINRA) in order to provide investment advice. It’s important to understand the two standards of care that advisors are held to by each. The fiduciary standard requires that an adviser put the clients’ interest first and is enforced by the SEC, while the suitability standard is enforced by FINRA and requires that a broker make recommendations that are suitable based on a client’s personal situation. You should also do your due diligence to find out if a potential advisor has ever been investigated or found guilty of an infraction.
  2. How does your firm operate? No great advisor goes at it alone so discover all you can about the team behind the principal advisor. The mix of the team speaks volumes about the firm. Ask what licenses, certifications and/or credentials members of the team have. For example, many top advisory firms will have a Certified Financial Planner (CFP) and a Chartered Financial Analyst (CFA) on their team. Go deep and investigate other members on their team as stated in the above. Ask what role they play and how this will benefit you.
  3. What services do you provide? Some advisors only offer investment planning, while others take a whole life approach. As an example, Certified Financial Planners (CFP) have a process that looks at your overall goals and creates a written plan that addresses the wealth gaps to get you where you want to go.
  4. What does a financial plan look like? Of course every plan is different and should be tailored to the individual investor. However, ask to look at a sample portfolio or investment plan. Find out how the advisor approaches the planning process and communicates with clients. Ask if or why you need a plan, you may not depending on your needs. Also be sure to ask for client references—and then check them.
  5. What is your investment approach and how do you choose investments? It’s important that advisors have a process of how investments are chosen and deployed in an asset allocation. Your advisor should be able to explain how and why a particular investment is chosen. Discover their buy, sell and rebalance disciplines. It’s easy to buy investments, it’s the discipline of when and why to sell that are keys to better performance.
  6. What is your communication style? Some clients are very financially savvy while others appreciate a bit of hand-holding and education. Will your advisor and his or her team take the time to thoroughly explain the markets, the investing rationale—and any other questions that you may have? At times of market stress, how does the advisor communicate?
  7. How are you compensated? Some advisors are strictly fee-based, while others earn their living by commission or from selling an investment product. Ask if there are any conflicts of interest which would motivate the advisor to do something that’s not in your best interest. Be sure all fees are disclosed and if you’re unsure about something—ask!
  8. What makes the investment team unique? We ask these questions when we buy a car, hire a contractor, or work with a personal trainer. An investment advisor should be no different. Ask them how they define a successful relationship. If your advisor can’t explain in clear language why they are different and how you will benefit from becoming a client, move on.

Know When It’s Time to Change Advisors

You may have been with an advisor for many years and have not been particularly satisfied. But sometimes it seems easier to stay with them because change can be just as difficult. Stop and take a minute to see if any of these points apply:

  • Lack of communication: A good advisor is always available for clients—by phone, email or appointments. If your advisor isn’t keeping you in the loop, it’s time to look for someone else.
  • Pushing products instead of giving advice. One size does not fit all. Your financial plan should be tailored to your specific goals. Avoid advisors who recommend cookie-cutter products or plans.
  • Not being proactive—or reactive. A year or two of lackluster performance isn’t cause for alarm. Those are things that an advisor cannot completely control. However, if your performance returns continue to be out of line with your risk tolerance or goals, be sure to discuss re-vamping your investment strategy. And, if you come away feeling that your advisor isn’t listening, consider making a change.

At JJ Burns & Company, we believe a good advisor is truly your partner in your long-term financial success. Talk to us about how we can help you reach your goals.

Exclusive Webinar: 2016 Mid-Year Economic & Market Outlook

June 1, 2016 2:38 pm Published by Leave your thoughts

[Update: For those who couldn't attend, you can watch the webinar video here.]

Will the Fed raise interest rates in June? How will the U.S. presidential election affect the market and your portfolio?

After a challenging start to 2016, the markets have improved. Issues surrounding a potential interest rate hike, U.S. elections, Brexit, and China continue to influence economic and corporate earnings growth. Find out how these challenges will impact investment portfolios in 2016.

Join JJ Burns & Company on Wednesday, June 8th at 1:00 pm EST for a complimentary webinar to discuss the 2016 Mid-Year Economic & Market Outlook. During this live presentation, CEO JJ Burns, Managing Director Anthony LaGiglia, and Chief Investment Officer Steven Mula will review our outlook for the next 6 months.

Bonus: All registrants will receive a link to the on-demand version of the webinar following its completion.

In this 30-minute webinar we'll talk about:

  • The recent market correction and our economic outlook for the rest of 2016
  • Issues affecting the stock market such as potential interest rate hike, U.S. elections, Brexit, and China
  • How we construct investment portfolios to take advantage of volatile markets

Plus we’ll also answer questions from attendees.

Don't miss this informative event! Reserve your spot today.

No Will? Don’t Make Prince’s Mistake

May 13, 2016 7:43 am Published by Leave your thoughts

David Bowie and Prince both had much in common—an international career as talented musicians, performers and actors; and sadly, untimely deaths this year (January and April, respectively). But possibly the most significant thing they didn’t share were wills. While Bowie had an estate plan and a will, Prince reportedly died without one.

We understand that discussing financial matters for some people is difficult—and that contemplating what will happen when you’re gone can be even more unpleasant. However, without proper planning, you stand to lose a significant amount of the value of your estate to state and federal taxes, not to mention legal fees. It’s estimated that Prince’s $300 million estate will pay $120 million—or more—in taxes.

Consider this: without a directive after your death, a judge could award your spendthrift step brother (whom you never liked) an equal share of your hard-earned assets as those awarded your children. Or, your alma mater may not be able to help fund the scholarship that was so important to you.

A comprehensive wealth management plan will give you the power to live the life—and pass on the life—that you want.

Officially Intestate

The legal term for dying without a will is “intestate.” Depending on the situation, it can be a lengthy, difficult process to sort out if you are managing it for a family member or friend—or if they are managing it for you.

To save effort, it’s key to understand what assets are not passed through in a will. These are assets where beneficiary(ies) are assigned or where there is co-ownership, and can include:

  • Life insurance policy proceeds;
  • Retirement plan funds in IRAs, a 401(k) or other retirement plans;
  • Assets held in a living trust;
  • Joint tenancy or community property funds with right of survivorship, such as real estate or bank accounts;
  • Funds or property held in a transfer-on-death account.

States Rule Over the Feds

The federal government has a specific tax percentage they levy on the amount of an estate. But what every state requires for probate and levies for taxes is different.

Generally, spouses, registered domestic partners and blood relatives will inherit under a certain state’s intestate laws; unmarried partners, friends and charities are not eligible to receive an intestate distribution. If there is a surviving spouse, he or she usually receives the largest portion of the estate. And if no relatives can be found, without a will, the state becomes the heir and takes any remaining assets.

In the case of Prince, who was divorced and had no living children, his one full-blooded sibling and five half-blooded siblings will all share in his estate.

Special Considerations

If you have minor children or loved ones with special needs, it’s especially important to have a will and other estate planning instruments in place to care for them. You don’t want to leave important guardianship decisions up to a judge who knows nothing about you, your family nor your wishes.

The Bottom Line

A will for anyone at the minimum is essential. A comprehensive estate and financial plan is even better. Changes in life invariably happen so make sure your plan is up to date. If you don’t have one, talk to us today.