Welcome to Peachtree Views. As you can tell from browsing our website, at Peachtree Investment Advisors our primary focus is on our clients. However, there are times when we feel it appropriate or beneficial to be subject matter experts or post articles of interest on topics related to wealth management. If you have any feedback on wealth management topics that you would like to see covered in the future, please contact us here.
Now that we have passed the halfway point of 2018, we invite you to read our assessment of where things stand in the capital markets. If you should have any questions or would like to discuss this or other investment related topics further, please feel free to contact us.
How often have you heard pundits pontificate about when to get in or out of the market? We have yet to meet the person that can perfectly time BOTH when to invest and when to be on the sidelines. You’ve probably heard the adage, “The market timers’ Hall of Fame is an empty room.” Luckily for long-term, disciplined investors, time is on your side. Yes, criteria such as valuations, fundamentals and diversification certainly matter. However, as these charts and return comparisons succinctly show, so does participation. Whether you invest at a market top or bottom, being invested in the long run has historically beaten sitting on the sidelines. A famous quote, commonly attributed to Ben Franklin, reads “The man who does things makes mistakes, but he doesn’t make the biggest mistake of all – doing nothing.” We hope you find these charts and data helpful. If you should have any question about this topic or other wealth management subjects, please feel free to contact us.
To state the obvious, investing involves risk. There is no such thing as a free lunch or a perfect pitch in investing. To be sure, there are many ways to minimize, but not necessarily eliminate, risk. This article, from Financial Planning magazine, reviews the benefits of asset class diversification in your investment portfolio. Diversification can provide benefits above and beyond mitigating risk and volatility. However, to reap the rewards it requires both patience and discipline. With that said, we understand that diversification isn’t for everyone. Some may prefer a more narrowly focused portfolio based on individual circumstances and preferences. By design, a broadly diversified portfolio will not outperform the highest returning asset class in a particular year. However, as shown in the linked article and despite some turbulent times for investors, it has returned approximately 7% this millennium, outperforming many individual asset classes and with a much lower risk and volatility profile (measured by standard deviation). At Peachtree, our clients are long-term investors, not traders or market timers. They prefer the peace of mind knowing that they are invested in a disciplined and diversified strategy. After all, successful investing is about good behavior rather than just good timing. We hope you enjoy the article. If you should have any questions about this topic or other wealth management subjects, please feel free to contact us.
Much has been written in the past about the difference between Brokers (held to the Suitability Standard) and Advisors (held to the Fiduciary Standard). This topic is getting even more attention recently as a result of the Labor Department’s plan to toughen standards for advice on retirement accounts. The financial services industry has a tendency to get overly technical and use a lot of jargon in articles, research papers, TV interviews, etc. Thus, we thought a simple whiteboard analogy could go a long way in educating investors on the differences between working with a broker and a Registered Investment Advisor. Unfortunately, many in the industry like to make it less than clear whether the person managing your investments is required to act as a fiduciary and put your interests first. Not all people providing investment advice are truly Investment Advisors even though their title may say something like “VP and Financial Advisor” or “SVP of Wealth Management”. Peachtree Investment Advisors is a privately-owned Registered Investment Advisor. Thus, we have no conflicts of interest or outside influences in how we manage our clients’ wealth. We are held to and strongly believe in the Fiduciary Standard, which means that we always put our clients’ interests first. Despite all of the conflicts, confusion and differences of opinion, this is a very straightforward issue. Ask the person with whom you are now working or are considering hiring for the future: “Are you an advisor governed by the Fiduciary Standard and will you always put my interests first?” We hope you enjoy this whiteboard video from HighTower Advisors and find it informative. If you should have any questions about this topic or other wealth management subjects, please feel free to contact us.
If you are interested in an article from the Wall Street Journal a few years back discussing the same topic and to provide more background, click on the link below.
It seems a natural assumption that quality of life and peace of mind go hand in hand with a well-deserved retirement. Imagine working hard for much of your adult life, being a diligent saver and doing all of the right things only to find that some of those very personality traits are infringing upon your happy retirement. As this article mentions, “Conscientiousness is the personality trait most closely related to academic achievement, job performance, marital stability and longevity. Conscientious people accumulate more wealth than less conscientious people…This all sounds great. And it is – until it collides with retirement.” The article also discusses another pitfall for retirees: assuming all that new-found free time could be dedicated to self-managing their investment portfolio. As the author explains, “Investors are notoriously bad at evaluating the risk they are taking with their portfolios.” We hope you enjoy the article. If you should have any question about this topic or other wealth management subjects, please feel free to contact us.
Some of our clients have reached the age where they must take Required Minimum Distributions (RMDs) from their IRAs and/or 401k accounts. Over the years, we’ve fielded a lot of inquiries about the options available for these distributions. Below is a link to an article from the Wall Street Journal that discusses a popular tax break for wealthy investors who are subject to taking RMDs. While every taxpayer is different, this is often a beneficial scenario for all parties involved: taxable income for the client is reduced and his/her favorite charities become the beneficiaries of the distributed funds. If you should have any questions about this topic or other wealth management subjects, please feel free to contact us. We hope you enjoy the article.
Sometimes, things are in fact too good to be true. We don’t think this is one of them. Many of our clients, and all of us here at Peachtree Investment Advisors, have established donor-advised funds to assist with charitable giving and tax planning. According to the National Philanthropic Trust, “a donor-advised fund is a philanthropic vehicle established at a public charity. It allows donors to make a charitable contribution, receive an immediate tax benefit, and then recommend grants from the fund over time.” There are many benefits of a donor-advised fund including:
- Gifting of appreciated securities without paying capital gains taxes
- Realization of immediate tax benefits
- Diversifying previously concentrated positions for tax free growth over time
- Flexibility on timing of contributions and grants
- Ease of administration / philanthropic reporting and online access
- Creating a lasting charitable legacy
We utilize Schwab Charitable for our donor-advised funds, which Barron’s rates as the top donor advised sponsor available. The process to establish the account is rather simple and the account minimums and fees are reasonable. Click on the links below to learn more about donor-advised funds and Schwab Charitable. We hope you find this information helpful. If you should have any question about this topic or other wealth management subjects, please feel free to contact us.
Those of you who are dealing with the rising costs of college education, take note of this potential savings opportunity. We’ve helped advise clients over the years on the traditional routes for saving and paying for college (e.g. 529 plans, Coverdell Education Savings Account, Prepaid Tuition Plans, UTMA/UGMA Accounts, etc.), but the purpose of this Peachtree Views article is to shed some light on a lesser known way to potentially reduce the financial burden of a college degree. The Academic Common Market is a tuition-savings program for college students in 15 Southern Regional Education Board (SREB) states, who want to pursue degrees that are not offered by their in-state institutions. Students can enroll in out-of-state institutions that offer their degree program and pay the institution’s in-state tuition rates – more than 1,900 undergraduate and graduate programs are available. Those that have researched schools recently understand that the difference between in-state and out-of-state tuitions is significant. We hope you find the article linked below to be helpful as you plan for college for a loved one. If you should have any questions about this topic or other wealth management subjects, please feel free to contact us.
Turn to the news on just about any evening and there is a good chance that you will hear some disturbing stories about cybersecurity related crimes. The statistics and threats to each of us of becoming a victim of a cybersecurity attack at some point are even more overwhelming. Being in the financial services industry, we are on the front lines of this war. And let there be no doubt, the threats are real and we are all fighting this war to keep these criminals from stealing our assets. We’ve seen firsthand where cyberterrorists have hacked into our clients’ email accounts in an attempt to get us to wire money out to a fraudulent account or third party. Fortunately, we have specific cybersecurity policies and procedures in place here at Peachtree Investment Advisors to mitigate these risks. With that said, there are many things that we should all be doing to protect ourselves and our assets. We hope you find the tips in these articles of benefit. If you should have any questions about this topic or other wealth management subjects, please feel free to contact us.
For Business Owners: SBA Top Ten Cybersecurity Tips
For Parents: Connect Safely: A Parents’ Guide to Cybersecurity
For Kids: CyberSecurity for Kids Top Tips
For Everyone: US Computer Emergency Readiness Team