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Just for Women – Raising Financially Aware Children

By | 2018, Money Moxie | No Comments

Being financially savvy has a massive impact on our lives, as well as those of our children and grandchildren. Kelly Ness, of American Century Investments, focused on improving our family’s finances.

The principles of financial responsibility are not well taught in schools. According to a recent study, high school children claim 88% of their financial education came from their parents.

Where do children learn money management? Statistically, children are far more likely to be savers than spenders if their parents or grandparents talk to them about money. So, what should we say?

First, we need to understand our own money habits. Which behaviors do we want our children to replicate? Which should they not follow?

Next, we need to open a dialogue. Discuss saving, investing, debt dangers, and charitable gifting. It is also important to be open about household income and budgeting. In this way, they can learn from real and personal experience.

An allowance is a great way for young children to learn. Kids who receive an allowance tend to save more than those who do not. Children should also have financial goals. This can be a great opportunity to teach them about working for income and saving for purchases. When it comes time to buy, they will have an understanding of its worth.

Creating the time to teach your children or grandchildren about financial responsibility will pay dividends. It’s never too early, or too late. Bring your older children or grandchildren to your next appointment at SFS and allow them to ask questions. This will help to reinforce the value of planning, investing, and saving for the future. If you have questions regarding family financial education, please reach out to us. We would love to help you help them.

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Financially Savvy Women

By | 2018, Money Moxie | No Comments

Just Getting Started

You are starting your financial life with a blank canvas. . . you are the artist. You can create a lifetime of financial freedom if you start with a few simple habits and follow them purposefully.

3 Tips to get you headed in the right direction:

1. Get a handle on your spending and keep debt at a minimum. Save for the things you want rather than borrowing. It may take longer but the reward will be that much sweeter.

2. Determine your top three financial goals—build emergency savings, get out of debt, buy a car, save for a down payment for a home, etc.—and create a plan of action.

3. Let compound interest work for you. Contribute to a 401(k), IRA, or Roth IRA and be sure to capture the full company match.

Settling Into Life

Mid-life offers the opportunity to regroup. Your family has a routine, your career is well underway, and you are looking to the future. This is an ideal time to create or refine your financial plan.

You may have up to 20 years before your retirement dream becomes a reality. Focusing on these items will help you reach your goals:

Increase your retirement contribution. If you are falling short, you still have time to make an impact.

Get rid of mortgage debt before you retire. Debt in retirement can reduce your standard of living and prevent you from living the way you had hoped.

Update your financial plan. Make adjustments if needed.

On Your Own

Suddenly single. . . now what? You may find yourself unexpectedly on your own. While the prospects of being on your own may seem overwhelming, we are here to help guide you through this transition.

4 items to focus on first. Taking control of your financial situation will give you confidence and peace of mind:

1. Sources of income. They may include your salary, insurance proceeds, assets from a settlement.

2. Outgoing expenditures. What expenses will you have monthly and annually.

3. Update documents. Insurance and retirement plan beneficiaries.

4. Review portfolio and plan. This includes investment holdings and options. Make sure they still meet your needs.

Reaping Life’s Rewards

You are living the life you’ve dreamed of and enjoying your standard of living. Count on living a long life. Now is the time to get your house in order—so to speak. What’s your financial legacy? Money . . . or financial values.

Top goals. These are the things that should be top on your list:

Review your income plan. Make sure your money lasts as long as you do.

Update your estate planning documents. Do they meet your goals? Determine the best way to pass assets to the next generation.

Have a family meeting. If you want your family to be involved, they need to know what to expect.

Designate a trusted contact who can help you financially.

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When Do You Need a Financial Advisor?

By | 2018, Money Moxie | No Comments

Last week I attended the Silicon Slopes Tech Summit that celebrates the booming Tech sector along the Wasatch Front. As I spoke with vendors and attendees, a consistent theme came up: “When do I need an advisor?”

Here are my thoughts on this and other similar questions I was asked.

Do I really need an advisor? You may not always need an advisor, but you always need a plan. If you don’t have a roadmap, how do you know if you have reached your destination? Many people have vague ideas in their heads of what success looks like. Maybe it’s retiring at the age of 50 and sitting on a beach drinking lemonade. Maybe it’s starting up your own company. Maybe it’s giving back to the community.

It is important to sit down and write out your ideas of success. Then take one more step by defining the path that will take you there. Without creating the stepping stones, your ideas will only remain wishful dreams.

Do you need an advisor to create that plan? No, as long as you are willing to do the research. Nowadays there is so much information available on the internet that you can become an expert in any area…as long as you are willing to do the research. As our CEO Roger Smedley puts it, “You don’t know what you don’t know.” Even more dangerous may be the things you think you know with certainty.

So, if you want to create your own plan, but fear you are missing something, consult with a professional that can identify potential pitfalls and help turn your stepping stones into concrete, actionable ideas.

Don’t advisors cost a lot? At SFS, our initial consultation is free. I love to see young college graduates come in who are ready to conquer the world. I give them some time to help create a plan. I know that if I help guide them in the right direction, they will be more financially secure, and who knows, they may even become one of my top clients in the future.

If a person becomes a client, then there are fees that vary depending on the services provided. Comparing our fees and our in-depth planning, we are a far better value than our competition. I have had people question our cost, but I have never had them question our value.

What you don’t want to do is to get your advice at the water cooler. While good advice may not be cheap, bad advice will always cost you dearly no matter how little you pay for it.

Is it best to talk to an advisor before or after my company goes public? Anytime you are dealing with a potential windfall, you should talk to an advisor. As human beings we constantly overestimate how much something is worth. When I was young, I thought $100,000 for retirement was a lot of money. Now, I know it could disappear in a heartbeat.

So, if you get a windfall, reward yourself by using some of the money to take a trip or do something fun. Just don’t blow it all in one place. The world is full of once-rich people that are now broke.

Make sure your money helps you accomplish your goals according to your plan. And if you don’t get the windfall you were expecting, still talk to an advisor. We can help you reach your goals.

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Women Bridging the Retirement Gap

By | 2017, Money Moxie, Newsletter | No Comments

It’s true that women average longer life spans than men. What is often unknown, or in some cases marginalized, is that we will need a larger nest egg to provide income for those additional years. This requires creative planning. Not necessarily more risk; rather a more defined plan for using the money we have saved for retirement.

As women, we also tend to focus on quality of life. We value things that give us purpose and enjoyment: traveling, giving back to our community, or creating memories with our children and grandchildren. These ideals drive our financial goals and decisions while money helps us achieve them.

Women often feel insecure about their financial
decision-making abilities. Building financial confidence is important. We need to be educated and have a better understanding of the decisions that need to be made and the options available to meet our needs. Once we have financial confidence, we are committed to our plans. We have a real desire to stay on track to attain what we consider to be financial success.

Developing financial confidence is the foundation to financial success. This comes naturally from our financial experiences – good and bad. It can also come through an exerted effort and a desire to have more knowledge and a greater understanding. Here are three ways you can take control:

Get Educated: Rather than wait for the life lessons to take shape, make an effort to learn more. You can attend educational seminars in the evening. Caution advised, most seminars offering free meals etc. focus on selling you a product. Our seminars are designed to educate you regarding specific topics and concerns. If you are busy at work, watch an educational webinar while you have lunch or in the evening from home. Our website has a collection of resources focusing on women and their unique needs. You can find it by clicking on Women and Wealth from our home page at SmedleyFinancial.com. If you have additional questions or want information on a specific topic, give us a call. We have a library we can draw from to provide you with the resources you are looking for.

Create a Financial Plan: A financial plan focuses on your personal financial needs, goals, and current circumstances. No matter where you are financially, you need a plan to move forward. Women often start a financial meeting by saying, “I don’t have very much….” The truth is, the less you have, the more important every dollar becomes. A plan will help maximize the assets you have available, creating a clear path to your financial goals and direction that will help you circumvent potential roadblocks.

Design a Retirement Income Plan: Most women want to know, “How will I replace my paycheck when I retire?” A retirement income plan is just as important as, if not more important than, a financial plan. Making sure that our money lasts throughout our retirement years is essential. By the time we retire, few of us will have the luxury of picking up another job to provide additional income. If we overspend in the early years of retirement, we may impede the success of our plan long-term. The same can be said about taking too much or too little risk; the results can be devastating. An income distribution plan must be updated each year to evaluate our ability to maintain our desired lifestyle.

You have the resources and ability to take control of your financial future. I understand you are very busy. Still, I challenge you to take the next step. Find one topic you want to know more about. Visit our website, give us a call for resources, or attend a seminar or webinar to learn more. There is never a better time to begin a financial journey than today!

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Preparing for Disasters

By | 2017, Executive Message, Money Moxie, Newsletter | No Comments

Watching nature unleash her fury over the last two months has been upsetting. Our hearts go out to those who are reeling from the devastation as they pick up the pieces of their lives.

As each potential disaster becomes a reality, it forces us to focus on our personal situations. We have heard numerous clients and friends – including myself – say they have pulled out their emergency “go” kits and reviewed their plans to make sure everything is in order. These plans often focus on food, water, clothing, and the essentials to maintain life for a short period of time. We want to be ready should we find ourselves in an emergency situation.

But, what if your emergency situation is financial? Your ability to weather a financial crisis may depend on your financial plan. Financial plans are designed to take into account and help you prepare for the many financial situations you may encounter.

Financial disasters can range from how will I pay for the car when it breaks down to how will I pay for care in my aging years when I can no longer stay at home? There are a myriad of situations to consider. Knowing you have a plan in place to address a financial emergency can help you take control should a situation arise.

Good intentions will not help in a financial disaster. Get prepared. If you have not created or reviewed your financial plan, I invite you to do it now! Your financial success is important.

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Your Future Is Here. Now What?

By | 2017, Money Moxie, Newsletter | No Comments

You’ve worked hard for your future and now it is here. Thirty-six holes, a fishing trip, and a dip in the hot springs–and it’s only Thursday. Now what?

Maybe you have always dreamed of working with 4H or the Boys and Girls Club of America. Perhaps you’ve realized that you need a little bit more income in retirement for the lifestyle you want; or you retired early and want health insurance until Medicare kicks in.

If any of these situations sounds familiar, it might be worth considering an encore career. Some encore careers are part-time roles in similar industries, while others involve finding a new role.

Luckily, there are several resources available for those considering an encore career. The AARP website (www.aarp.org) has a section on encore careers while organizations like encore.org (www.encore.org) aim to create a movement to give back to communities.

There is also another resource that you may be overlooking: SFS. Hopefully, a successful career and your relationship with us has put you on the path to financial freedom.

We can help you develop an income distribution plan using your current assets to subsidize your new, probably reduced income, and to ensure your monthly income is sustainable.

In addition to helping with the transition, we can help you throughout your encore career. We will continue to monitor your financial health and manage income distribution while also providing advice on things like health insurance, Medicare, and Social Security strategies.

Discuss the options for an encore career with us. It can be a great way to continue being involved in your community and it can help with your financial freedom.

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Women in Transition: The Loss of a Spouse

By | 2017, Money Moxie, Newsletter | No Comments

One of the hardest life transitions women face is the loss of a spouse. Whether it is from death or divorce, picking up the pieces and moving forward is challenging – emotionally and financially.  One of the hardest life transitions women face is the loss of a spouse. Whether it is from death or divorce, picking up the pieces and moving forward is challenging – emotionally and financially.

Where there were shared responsibilities, suddenly you are in charge of everything from getting the car fixed to managing the daily budget and long-term financial plan. It can feel quite overwhelming. Not to mention, this transition comes at an incredibly emotional time.

Adjusting to your new conditions will not happen overnight and may actually take several years.  This is a time of profound self-discovery for women, who may find themselves examining issues of identity, life meaning, and aging. Creating a support group – family, friends, and professionals – gives you a pool of people you can use as a sounding board that will keep your “best interest” in mind when providing advice.

While there will be many things to tackle over the next year, here are some important things to do in the short-term:

Locate and organize your important documents and financial records. It is easy to overlook something when you are dealing with emotional stress. Having a system for gathering and organizing financial records can provide some sense of control.

Important financial documents and records are generally the first items to focus on. The bills still need to be paid and the cash flow needs to be managed.

  • Checking and savings accounts statements
  • Investment account statements
  • Retirement plan statements
  • Stock and bond certificates

Legal documents may need to be updated, reviewed, or available for reference. These include:

  • Will
  • Trust
  • Power-of-attorney
  • Medical directive

Other important papers should also be organized so that you can determine if adjustments need to be made, such as updating ownership records or beneficiaries. Some may be required for documentation as you make changes.

  • Social Security statements
  • Insurance policies
  • Marriage, birth, and death certificates
  • Property deeds
  • Ownership titles – vehicles and recreational equipment

Keep in mind that everything does not have to be done immediately. Gathering this information will allow you to set up a system for tracking important details. Keep a notebook or use a computer spreadsheet that you can easily access for account numbers, phone numbers and addresses, who to call for information on accounts, professional contacts, and deadlines to monitor.

After the initial legal and financial matters settle, you will begin adjusting to your new financial circumstances. As you move forward, remember that it may be two steps forward and one step back. Take comfort in knowing you are making the best decisions you can, financially and otherwise, for you and your family.

Remember, you are not alone. Even though you believe you can do it all, reach out to us as your trusted advisors. We can help you navigate this new landscape, avoid some of the pitfalls, give you advice, and be a sounding board as you make important decisions.

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What Tech Employees NEED from Financial Advisors

By | 2017 | No Comments

I recently surveyed tech employees to find out how financial advisors can better address their biggest concerns. Here’s what they had to say.

Make me believe that my company is a unicorn, but help me save as if it isn’t.
Even with the tech boom, only 15 to 20 new companies per year will eventually reach the mark of $100 million in revenue. The good news for Silicon Slopes companies is that the majority of those companies are coming from outside the San Francisco area.i The new 2017 list shows that Utah is home to 4 Unicorns: DOMO, Qualtrics, Pluralsight, and InsideSales.com.ii

Are you working for a unicorn? Many tech employees sink all of their excess cash into stock options. This can create a huge windfall or a major money pit. Britt Hawley from InsideSales.com says that tech employees need financial advisors to, “help them understand, manage, and factor (stock options) into their financial planning.” A good financial advisor can help you create a holistic plan that still optimizes your stock option purchases while giving you some balance through your 401k, insurance planning, and other investment planning. Dan Preece from HealthEquity found this to be true when the company he works for went through an IPO; “One of the biggest things for me was having help navigating through stock options, IPOs.”

Part of a holistic plan is creating a way for you to reach your goals even if your company doesn’t get bought out or go public. There is a lot of value in diversification and multiple income streams. You should still be contributing 10-15% of your salary into your 401(k). If your 401(k) ends up being the smallest piece, then it is still icing on the cake. If your 401(k) is your main retirement, then you will be grateful you chose to save. You don’t want to have to delay retirement because you are still hoping that your company will go public.

Help me without taking all of my money
Too many times tech employees seek out good advice only to find a sales person, masquerading as a financial advisor, pushing the “hottest thing since sliced bread.” Kayden Holt from Pluralsight put it this way, “Employees need people to help them without taking all of their money.” Unfortunately there are a few rotten “advisors” that taint the whole bunch. Be wary if an investment planner is only playing on a one string guitar or sells you something that is too good to be true.

Seek out a holistic advisor, typically a Certified Financial Planner®, that will look at all of your goals and will devise a plan to help you get there. Also make sure the fees they charge are in line with the service provided and that they can prove the value they are providing. Tech employees “like to know in a tangible way how they are benefitting from a financial advisor,” stated Mr. Hawley. Good advice does not have to be expensive, but bad advice always costs you dearly, no matter how little you pay for it.iii

Educate me about how to invest.
Tech employees are more savvy than most. “They like to understand the why” behind an advisors investment actions, said Mr. Hawley. Good investment advisors will be able to explain the details of their investing process with its pros and cons. They can explain in concrete ways what they can do for you that you can’t do for yourself. If you want to do your own investing, they can help you do it. If you want to have someone else manage your money, they can do that too. Most importantly they will be a teacher. “Just as much as we needed grade school to learn how to read and write,” said Mr. Holt, “we need financial advice to learn, grow, and earn.”

Give me different ways to access advice.
The world of advice is changing. The old stockbroker model of paying commissions for stock trades is dying. In its place you can find different models: Do it yourself, monthly retainer, or assets managed for a fee.

Technology is changing the landscape and making better advice and trading platforms available to the masses. Many do-it-yourselfers are drinking in the information and trading their own account.

Paying a monthly retainer, like $100 a month, is a newer model. It allows you to call up and ask questions anytime you want. It also helps people start out on the right foot even if they don’t have a lot of investable assets. It begs to reason that if you are willing to invest $100 in a phone every month, you should be willing to invest $100 in your financial security.

If you don’t enjoy researching investment ideas, you don’t have the time, or you’re afraid of not knowing what you don’t know, then seek out a holistic fee based firm that will also give you advice as part of that fee. The fee based model makes sure the advisor’s interests are aligned with yours.

Shield me from taxes
Tech employees tend to excel and have some great financial rewards. You may also be working for a unicorn and end up with a windfall. In either case you are probably getting killed by taxes, figuratively of course. Mr. Preece stated that reducing tax liability is extremely important because “I’ve worked hard to earn what I’ve got (often putting in late hours) and I want to ensure that I can enjoy as much of what I’ve earned as I can.” The best financial advisors will work in concert with CPAs specializing in stock transactions to make sure you can shield yourself from as much tax as legally possible.

Tech employees have some unique needs. The right financial advisor can help address those needs and make sure your future is all that you expect it to be. As Mr. Holt said, an “advisor is one of the only ways to balance your money and invest in yourself.”


i https://www.strictlyvc.com/2014/12/01/many-tech-companies-break-year/
ii https://www.cbinsights.com/research-unicorn-companies
iii http://www.cbsnews.com/news/quest-for-alpha-the-final-10-rules-for-being-a-successful-investor/

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Forge a New & Powerful Financial Paradigm

By | 2017, Executive Message, Money Moxie | No Comments

Dear Friends and Financial Partners!

How can you improve your savings and investing before and during your retirement? Here are some nifty (some might say awesome) tips to immediately change your personal money paradigm.

Change Your Money Mind-set: Chris Reining, who lives in Madison, Wisconsin, became a millionaire at age 35 by doing one thing differently. Chris started working to save and invest, rather than working to spend. By going through a self-imposed paradigm shift, your life can also transform from a working-to-spend environment to a savings-and-investing world. The outcome speaks for itself. This is one powerful idea.

Get Professional Financial Help: Ours, of course. When you are accumulating assets in your 401(k) or 403(b), you are in an automatic investment mode. If you don’t know what the sequence-of-returns risk is or how dollar-cost averaging works against you during your withdrawal years, you are already behind and need our help. Social Security has over 2,700 rules and hundreds of exceptions to these rules. Medicare is filled with land mines. Distributing assets during the decumulation phase is exponentially more complex than adding assets.

Take Charge of Your Emotions: Don’t let your emotions take charge and dictate your actions. Specifically, when the stock market is dropping or has dropped, don’t lock in your losses! Remember: Stock market drops are temporary. Locking in losses is permanent. Locking in losses by selling at or near the bottom of a market may be a mistake you and your loved ones will pay for the rest of your lives.

Ignore the Media: Call us. We know your specific financial goals. We manage money and segment your accounts by time to avoid the sequence-of-returns risk. Even when the media is all doom and gloom, there’s a good chance your accounts will be doing just fine with respect to your own financial goals. “The Sky is Falling” mentality illustrated by Henny Penny, more commonly known in the U.S. as Chicken Little, may cause you to want to lock in your losses. Don’t do it. Even well-meaning friends and family members can push you away from financial goals.

Remember: Contrary to many, investing is not about beating the market. Financial planning and investment management are about meeting your goals, including having a sustainable income stream during retirement. At Smedley we strive to help you forge a powerful, yet personal financial paradigm. As always, we are on your side.

Bullish Best Wishes,

Roger M. Smedley, CFP®
CEO

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Sharla Jessop–President of Smedley Financial

By | 2017, Executive Message, Money Moxie, Newsletter | No Comments

Dear Friends and Financial Partners!

Smedley Financial Services, Inc.® is pleased to announce that Sharla J. Jessop, CFP®, was elected and has accepted the position as President of Smedley Financial, effective immediately. Sharla was elected by acclamation at our annual Board of Directors meeting in February 2017.

Sharla officially joined forces with Roger on March 1, 1994. Sharla had previously worked as an insurance agent for 10 years in Ogden and Salt Lake City. Shortly after starting, Sharla astutely passed four exams in four months.

Sharla became a Certified Financial Planner® certification holder on October 10, 2006. This includes meeting rigorous professional standards and passing multiple challenging examinations plus a 2-day, 10-hour comprehensive exam.

One of the best things about Sharla is her love for people. With Sharla, you, our clients, have always been first and foremost in her mind. She has always put your best interests first. Her ethics are above reproach.

Sharla has always been a powerhouse. From the beginning she has demonstrated great drive, energy, and ability. In so many ways Sharla has been fearless. She has met challenge after challenge. Sharla has always been teachable. If she didn’t know something, Sharla wouldn’t stop researching until she found the correct answer.

What you may not know about Sharla is that she is well-respected nationally. Many of her peers throughout the United States seek her input on a regular basis. Sharla has made time for mentoring new advisors throughout the United States.

So, at Smedley, we are entering a new era. I’ll still be around as the Chief Executive Officer (CEO).

Bullish Best Wishes,

Roger M. Smedley, CFP®

CEO

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