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 PreshowReturn to index of stories... |
Building and Preserving your Nest Egg. An Investor Survival Guide. Now on New Hampshire Public Television. |
| Hello/Nest Egg Return to index of stories... |
Hello Everyone. I'm Myron Kandel. Welcome to More Than Money: An Investor Survival Guide. I'm here at the historic Mount Washington resort in Bretton Woods, New Hampshire. The monetary system that was created here more than half a century ago is being revisited amid the world's current economic crisis. Individual investors have also gotten the message to re-examine portfolios and investment objectives. To help you do that we've put together a series of programs. In this program we'll focus on building and preserving a Nest Egg. We begin with a personal story. Beth Carroll shows us it's never too late to invest in the future. Nationwide Insurance Commercial 40% of Households Have Saved Almost Nothing for Retirement. Health Care Costs 2nd biggest barrier to retirement saving source: NASE 2007 Retirement Survey |
| Building a Nest Egg Return to index of stories... |
MARGE- REVISED 10/24/08 NATS: Nationwide Insurance Commercial: Music Up….life comes at you fast. TRK1: . So fast research shows 40% of households have saved almost nothing for retirement. SOT: DEE: 08:06:21 the reality is that most people when they think they can retire… cannot. TRK2: Dee Lee HAS authored several books on retirement. She says you need to start planning for retirement at your very first job… But, few do. SOT: DEE: 7:50: 43 people don't look long term. They see that the car payment is due they see that the kid needs braces or see that they want shoes or there soccer equipment or their hockey equipment I mean outfit a kid for hockey is a 1,000 bucks. So they think that they have Time and they don't. TRK3: Given near-empty nest eggs an increasing number of boomers are working beyond retirement age. Nats: Margi @work: 6:45:58 I'm taking trip to staples.if you need anything I can get it. TRK4: 65-year old Marge Varnum of Nottingham is one of them. SOT: Marge: 2:05:37/@ home I am not going to retire laughs.you know I am going to just keep working. TRK5: Marge is an office assistant at her son's construction company. It's a new job with benefits and a 401 k plan. SOT: Marge: 2:10:58 yes, but since I started my retirement plan when I was 64…its going to be a while before its going to accumulate wealth. Nats: portsmouth fabric co TRK6: We first met Marge when she was working part time at the Portsmouth Fabric Company. A lot has happened in those 3 years. Sot: 2:03:17 Marge: well the biggest thing to happen was I needed my aortic valve replaced and I did not have insurance, so I have a lot of medical bills. TRK7: 20 thousand in medical bills, another 10 thousand for living expenses. SOT: Marge: 2:05:09 I used up all my retirement. What little savings I had paid off the hospital, and all the doctors bills I have been paying off slowly. TRK8: National surveys show that Health care costs are the 2nd biggest barrier to saving for retirement. SOT: DEE: 07:57:37. I did research for one of my books, "The idiots guide to retiring early" and everybody wanted to retire at 55. But nobody thought about the healthcare issue because Medicare does not kick in until your 65. So you have 10 years where your naked you have to provide your own healthcare and that could be if you're a couple it could be 10-15,000 dollars a year just for healthcare premiums. The other costs that come with it you know your co- pays, the out of pocket expenses, so you need to be looking at 10-15,000 dollars a year for healthcare. TRK7: To pay for costly prescription drugs Marge used credit cards. SOT: Marge: 2:17:00 I was paying 500 dollars a month for the first 3 months after surgery. Then you know food, gas, you know whatever TRK8: The use of credit cards has seriously increased the debt level of the 55 plus generation. SOT: DEE 07:59:16 One of the largest increase in bankruptcies are retires why, b/c they are abusing their credit cards……. People use their credit cards and they use them to supplement their income and they think well I'll just pay off the minimum this month and it gets them in trouble. TRK9: To pay off credit card bills…Marge is relying on skills she learned as a homemaker…. teaching sewing classes and weaving scarves. NATS: 6:24:040:10 Marge: I usually sell them for $85 to friends.sell to a lot of friends.I think my retail price will be 90 this year, they're beautiful scarves.top chenille. TRK10: Stacks of wood outside her home will be used to cut heating costs. Nats: Marge in garden: CLIP 631: 6:28-35 I love these French beans. Wide Margi PIKCING with nats 6:28:45 TRK11:… she even grows her own food. NATS 6:32:10 Marge/garden: I THINK u do save because you're getting good organic food and that's expensive to buy even at the farmers market 6:32:26 **** TRK 12: Can all that make a difference? SOT: DEE: 08:37:08 No. She can't possibly do enough and as we get older we may not want to lug wood in, we may not want to be cold, and we may not want to grow our vegetables b/c it still means working out there in the garden and one of the biggest problems is when people say to me my plans for retirement is I am going to work forever. You may not be able to you may have arthritis, you may have another ailment, they have cancer there may be something that prevents you from working forever. Trk13: Ideally, Workers in their 5o'S or 60's should be saving HALF their paycheck toward retirement SOT: DEE: 7:51:55 she can't save half her paycheck and most people cannot unless you are in a duel income family, where your kids are already out of the house your home is paid for maybe you could stock away one income 7:52:07 TRK 14: So, what will Marge's retirement look like? SOT DEE: 07:57:10 She is going to be working for a very long time, and you know what that's ok too those are choices we make. Many people work because they want to, many people work because they have to in retirement. TRK15: Dee Lee 's advice on managing money is also featured in daily radio segments. Dee: a comfortable retirement should be #1 goal…women are not saving enuf. TRK16: Dee says women outlive men and need to make their savings last longer. SOT DEE: 07:55:47 90% of women will be alone in retirement at sometime. 90%, so yes women should plan on being alone. Which is why it is important that they need to learn about their finances, especially if they relied upon a husband or a partner all these years to take care of the financial decisions. . TRK17: Like many nearing retirement.Marge's home remains her biggest asset. SOT: 2:23:04 Marge: That's what I invested in basically…when the divorce went thru. I didn't know much about investing and I was looking into where I was going to live and what I was going to do and I figured that real estate was as good as anything to invest in. SOT: DEE 08:00:23 Well often times people do think of their home as an investment, it truly is not, it's your home, it's your shelter, if you are going to use it as an asset sell it and down size. TRK18: This generation is also the first to join their parents in retirement, at the same time. So how does Marge's parents retirement differ from hers? SOT: Margi: 02:15:29 They were able to save money, their house is paid for and of course they didn't get a divorce. TRK 19: Boomers like Marge will also face more time "in" retirement. So, how do you make your money last a lifetime? SOT: dee 08:08:22 Plan. You know it's a four letter word and we hate four letter words, but the reality is we should be planning for retirement all through your working career. well you need to sit down and calculate what are your needs going to be and there are calculators online, there are actually ASEC American Savings Council has some great calculators on their website. You could figure how much you need, how much more you need to save. 7:52:40 Now the nice thing about these calculators is they allow you to change the parameters'. Let's say you want to retire at 60 and you want to have 50,000 $ well you run all the numbers and the ting goes tilt you can't retire then and you are certainly not going to have 50,000 in retirement income. So you put the factors in again. Maybe I will retire at 65, maybe I'll work part time in retirement. So retirement planning is fluid, because there are so many things that happen to us I mean life happens and it changes all of our goals. TRK 19: Does the old adage.it's never too late ….apply to Retirement Planning. SOT: DEE 08:09:05. Yes, The reason why is because no matter what you save you hopefully are not going to use it all the day you retire, or you go into a partial retirement and you collect your social security, you're on Medicare, you are still working part time, you are still doing the things you love so its not a chore everyday to get up and face work. TRK20: But, there is a "cost" to waiting. SOT: Beth 08:34:57 What's your sense about Margie's picture? SOT DEE: 08:35:01 Well Margie is going to have to be diligent she needs to be able to stay on top with it and consider whether or not she will need help from her son and that may very well be the situation as time goes on she may not be physically able to work she might not be able to stay in the house that she is in. SOT: Beth: 02:22:21 When you look ahead at retirement are you optimistic? SOT: marge 02:22:29 Well I would probably ban together with 2-3 other people in a house grow food and you know I lived with very little money for a very long time. SOT: 2:09:33 beth.do you worry about outliving your money? Sot: Marge: 2:9:36 well, I already have. 02:08:25 No. But I probably wouldn't have anyway. You know b/c eve if I retired I would be sewing more, I would be raising/growing more food I am not somebody I can't see me retiring. |
| Intro Jaffe Return to index of stories... |
It's clear, investing in the future is something we all need to do, no matter how old - or young-we are. And, given all the instability in the markets it might not be wise to go it alone. What qualities then, should you look for in a financial advisor? I talked to Chuck Jaffee, senior columnist for marketwatch-dot-com, for some guidance. |
| Choosing a Broker Return to index of stories... |
Chuck Jaffe Highlighted time codes are the Camera on Chuck Jaffe 15:01:48 14:19:33 Myron talking to Chuck about calling him Myron not Mike. Also how John McCain kept calling Myron Marvin. 15:02:51 14:19:59 Chuck Jaffe is the Senior Columnist from Market Watch. Com. Author and syndicated columnist for many years. Chuck why is it important on picking Can I do that again? 15:03:22 14:20:28 Chuck Jaffe is the Senior Columnist at Market Watch. Com. Author of a book about picking financial advisors and syndicated columnist for many years. Chuck why is it important to pick the right financial advisor? 15:03:39 14:20:46 Well if you're going to turn for help you want to make sure you are going to get it and so many people wind up advocating this decision, they come to a point we're they say well I maybe need something but they don't entirely know what they are looking for and then they go off and meet somebody who says I can help you, but you are not getting the right fit and lets face it, it is more important who you pick as your financial advisor and it is which investments you pick there going to be the one who guides you through this process getting them the right fit is arguably the most important financial decision you'll ever going to make. 15:04:13 14:21:18 you know you use the word advisor and I do too a lot of people would really say I really need a broker is there a difference? 15:04:20 14:21:26 There is a huge difference and in fact it's a big source of confusion for consumers right now as well. A stock broker is really somebody who really is just managing the stock portion of your portfolio. They may get involved in other things, but what you have to decide is what the services that you want. Do you want somebody who is really only going to run the investments or do you want somebody who is really going to coordinate the whole picture to make sure you have enough insurance or do you need annuities to protect your income, do you want to make sure that you're getting certain investment types, do you want a quarterback or do you want somebody who is going to be a specialist and that's really what it boils down to. A broker who tends to be a specialist, an financial advisor tends to be a generalist. 15:04:59 14:22:06 Now I have an account, I have a lawyer, I have an insurance man don't they do some of that? 15:05:06 14:22:13 They do. The question is whether or not they are working in concert and whether or not you're getting the best advice for your money. Because as a general rule you talk about the various types of experts you got your account who works in a vacuum, and you got your lawyer who works in a vacuum, and you got your broker who works in a vacuum and ideally they wouldn't work in a vacuum you need to get them together or you have somebody to coordinate the plan. 15:05:32 14:22:38 Now there are a lot of people who do call themselves brokers who do really what you say, how do you find out whether you really have the right one? 15:05:39 14:22:46 There are a few things and first you start with checking credentials because somebody who is a broker these days if they are doing more financial advise and doing more then just picking advise there typically have gotten the right qualifications to be a financial planner and you are going to be looking at a form called Form ADV that's a form that a financial advisor has, its not short for anything it's just the first three letters of advisor and you want to take a look at that because it gives you there background and there regulatory history and things along those lines. A broker has a different form that's part of their background check and you want to start there and basically make sure there are no red flags. But a lot of this is also going to come down to personality its not just oh are you qualified, these are the people who are going to be guiding you through some of the most trying important times of your life, whether it's the market has gone crazy or one spouse has died and the other needs advise or we're passing the money to your kids these are extremely trying times. You want to make sure you don't just have someone who qualified, but you want to have somebody who is qualified for you and your family. 15:06:48 14:23:55 Well I have a friend who said that he or she has a really good financial advisor just take that advice from the friend and go on from there. 15:06:59 14:24:06 Yeah that is a horrible way to go. And it's a horrible way to go because chances are good that they didn't do the right things to pick that advisor, did they vet them, did they check more than one, what came to their conclusion, they maybe be a perfect fit for your friend, but your friend may have a totally different scenario then you have. I like to point out that if you drive down my street and you go to the end of my street you'll find a guy at the end who drives a Jaguar and hey we can obliviously afford to live in the same neighborhood, but we don't work the same kinds of jobs, we obliviously don't have the same kind of spending ideas, because I got my Volks Wagon to his Jaguar and our jobs are totally different. He's a doctor he works that kind thing that different type of income stream so we might be friends, we might live in the same neighborhood are cars my look the same when they are in the garage, but we are not the same people and hence we probably shouldn't have the same advisors. 15:07:58 14:25:04 What about the chemistry is that important? 15:08:00 14:25:07 The chemistry is huge and one of the big things that happens is people turn to advisors when they gotten enough money that they feel is important but they also frequently its one spouse's driving decision and both spouses need to be involved and in fact both spouses need to be involved in managing money they have to be involved in picking the advisor. I like to put it this way I can almost deal with any advisor but who my wife is going to want to deal with when she out lives me and she has to call these people in her time of need is extremely important. So I have talked to people where the husband really likes the advisor and the wife thinks he's too slick, ok what's going to happen if he predeceases her now you are going to have this time were she is going to deal with this guy she doesn't want to deal with and that is a recipe for disaster, it's a recipe that even if the guy she's got is ok, she doesn't want to deal with him so what happens in her time of need she is going to find somebody else and now is potentially a victim of senior abuse because we know that the really bad cases here are folks who get taken and at their time of need frequently when they are senior citizens, you got to have that right chemistry. |
| Choosing a Broker 2 Return to index of stories... |
15:09:07 14:26:14 You mention a very important point senior abuse. Now most investment advisors, most brokers whatever they're called are honest hard working people who would want to do their best for their clients but there is a small percentage who do not, who are in it just for themselves. How do you avoid getting in the hands of that kind of person. 15:09:30 14:26:36 Well there are a few things that you have to do. You start treating everybody when you don't know them like they're that guy who is bad and that's and I'll point out that includes the guy who came from that referral great they are your neighbors advisor but that doesn't mean they are going to be great for you and there are a lot of things that can go on there have been plenty of cases where rogue advisors had their good referrals and then were stealing from the bad- the folks that they didn't know. So you start by treating everybody as if they are that rogue advisor and you make them prove it to you. You also put up a level of service that you want to achieve, remember if they won't do what you want them to do when they don't have your money and they don't have you as a client you have no reason to expect them to do what you want when they do have your money so you load everything up on the selection process, make sure you are doing a full background check. Most times when there have been the big headline cases where people got ripped off by that rogue all they would need to do is call their state securities administrator to find out you know there are enough red flags here maybe I shouldn't go with this guy. That's one. Two check references talk to people, not about- advisors hate giving out references it's not about how much did the guy make, it's how did they treat you, how did they interact, what happened the first time they gave you some advise ad you didn't take it that's not even a question that an advisor can answer about themselves. So you want to talk to references whenever you can, make sure you see a sample plan. They're going to have some plan it's going to be for Prince Charming or something along those lines depends on how clever they want to be, but this is what I am paying for, what's it going to look like, can I read it, can I understand it does it makes sense to me and my spouse if there is a spouse in the picture and that's how you're going to vet the person. 15:11:19 14:28:25 You made a good point that people are vulnerable when there in time of need and lets say the death of a spouse or divorce or something like that, even an illness of a child or a grandchild, that's a moment of vulnerability. So you shouldn't be waiting for that moment to be looking for an investment advisor. 15:11:40 14:28:47 Not only should you not wait for that moment but I think there is a lot of comfort. For example when you're talking about seniors who have done it themselves or mostly themselves their entire life. They may have done it themselves, but usually one partner is more dominate then the other. What you would like to leave for your loved ones to be able to make it through that difficult time is some measure of instructions or some measure of guidance. So if you didn't work for a financial advisor and you get too late in life what you really are setting it up is the survivorship plan. Ok helping to make sure that I can take care of my family and Oh by the way when the time comes when I am not here to do it instead of my spouse saying, this sort of seems like somebody whose just the way he would have done it. I want them to say No that is the advisor you picked, that we picked together and that where you could have that continuity rather than that disconnect now I am going to a stranger. 15:12:33 14:29:41 You know we talked about seniors. There are people who have either run their own money and felt that they didn't need investment advice and they get older. Not only did they get older but investment climates change right. So therefore what you think you've been doing well you may not be as courante? as you should be, how do you deal with that? 15:12:57 14:30:06 Well you want to make sure that you got a financial advisor who is maybe talking to you about a lot of things that don't necessarily come up. There's a concept that has become very common in financial planning called longevity risk and its really the risk that you're going to outlive your money. And, you might think Oh I am not I got this insurance program etc , but there are new products that are being created every day. So what you want to do is address; here are my financial concerns what do we need to do to get them addressed completely and what's a current way to do it. It doesn't mean you want to throw out everything you have out the window I think that's a danger spot especially with seniors who maybe have a lot of insurance they go and meet a new advisor well we are going to let these polices go away, were going to put you in something new. That's great for the advisor its not always great for the consumer. It may on the surface look good, but a lot of times it has to work out just perfectly to be the right move. So I think that you want to take a good hard look at any of the new fangled ideas. Be somewhat skeptical about them, but understand that the problem that we have today is people outliving their money and you don't want to be on that side so what are doing to help people get there. 15:14:16 14:31:22 Well you know there are people who feel strongly about what they do a mutual fund salesman thinks mutual funds are the greatest. A stock broker thinks stocks and bonds are the best and an insurance man thinks it's the be all and end all of financial planning and they really mean well and they are enthusiastic about what they do because they are doing it well, but how do you avoid getting in the hands of a specialist who is not looking at the overall picture. 15:14:48 14:31:54 Well one of the ways that you can do that is you can go hire a financial advisor who is basically takes you on as a client to build the plan, but leaves it for you to implement. So that way great we know that we want to get a certain amount invested in large cap mutual funds but I am not going to be the guy putting it together. I'll let you the customer put it together and the sort of give you the action plan and they'll do checkups on a regular bases and it's a growing segment of the financial planning business where they're saying, gee I want to really work more on an hourly bases giving people a plan that says where you're going, here's where you're at, how do we go from here to here and that puts you in that mode where ok here is what you're going to need and we all agree that this is the plan, now you go make it happen and then you can go work with your specialist's. Or again getting to that point where why do you talk with multiple advisors, you'll get specialists who will say, Oh I can also help you on the insurance side or I also do stocks and mutual funds. I like to call those people utility infielders take the baseball analogy out, utility infielder is a player who is good enough to play a lot of positions, but not good enough to start at any one of them. If I am going to build a financial team with a quarterback who sort of looking- I want players who can start at every position. I want a guy who really good at accounting to be my accountant. I want a guy who is really good on insurance to my insurance, I want a guy who is really good at investments to be on that side. I don't necessarily want somebody who says I can do a little of this and I can do a little of that. 15:16:22 14:33:28 Well there are different degrees of compensation right, you just mention a moment ago about hourly compensation. There are people who get a compensated by a percentage of the assets that there managing for you and so on. What's your suggestion. 15:116:40 14:33:46 Well I think the first thing that people need to understand is that every type of financial advise comes with a conflict. That those folks who say we charge a percentage of assets under management will tell you that is conflict free financial planning. It's not, not at all every single one. In the case- your selling on commission people don't like commission because I sell and then I get my money on a cut of that, but at least the conflict is out in the open. Think about it this way if you go to your financial advisor, you just received an inheritance or you just cashed out your annuities, whatever it might be you got a lump sum of money and maybe it's in your best interest to pay off your mortgage. Well if you pay off the mortgage that money does not become assets under management that advisor who gets a percentage assets under management doesn't get the money. So for anybody to tell you that its conflict free is silly, you know it doesn't exist. And especially the more complicated we get with certain types of products and everything else. So there is no such thing as conflict free planning then its going to be which conflict-pick your battle. I do prefer the fee only model, because it does align their interest and yours. It does say, ok you're going to get paid more if I am making more, but again I want to make sure somebody understands, that hey we need to talk about some decisions that are not best for the advisors compensation, there may be decisions where the best thing to do for my family is to put money into things that don't increase my portfolio and don't increase your compensation and if they're not willing to do that, that's where the conflict comes up. |
| Choosing a Broker 3 Return to index of stories... |
15:18:18 14:35:24 The- Look you talked about growing assets. We all want to grow our assets as we get a little closer to retirement age or we're already retired are more interested in conservation and growth. How do you approach that? 15:18:39 14:35:44 I think everybody needs to come up with a plan that works for them. For some people its what I call the don't mess it up money plan. You don't mess it up money is if you gotten to where you can be set for life, take the money that you need to be set for life and don't mess it up. If that means treasuries or protect inflation treasuries, ultra safe investments if you can keep them all in money market funds do it. It's not about how much can I get between now and the end of my life make sure that you have that money that's set for life and go off and you can sleep well at night. No matter what happens to the rest of it once the don't mess it up money is here you can go buy scratch tickets if that's what you wanted to do but then you can also take other risks to decide what the rest of my goals are and you know you will always be able to sleep well at night and market times like we have right now, the folks that are able to sleep good at night are the ones who feel there future is reasonably protected. 15:19:37 14:36:44 What about the 5 years. You know we heard people talk about- if you need your money within five years be very careful with it. 15:19:47 14:36:53 Well what you are seeing and I actually have written about this is a change in the definition short term. And the definition of short term changes every time the market sentiment goes in different directions. So let's go back to the 1990's when the market was booming short term kept getting shorter and shorter because people wanted - they felt you can't lose in the market so they wanted to put their money to work. Now people are feeling well gee I can't win in the market, I don't know when its going to bounce back after all the turmoil that we've had. So we see short term to get out to be 5 years. So go back a decade short term was 18 months to 2 years. Mid-term or intermediate term was 2 years to 5 and the long term was anything after 5. Now short term is 5 years intermediated is up to 10 and long term is more then 10. If you're in your 20 that's definition will cost you, if you are in your 40's or 50's that's not a bad way to go, but it also requires you to save more to be able to make up for the fact that you have a little more of your money on that short term scale. 15:21:02 14:38:08 You know there's a little bit of a gambling streak many Americans, even seniors right who will visit Atlantic City or Las Vegas or whatever right. Once you get to a certain age should you subdue that gambling instinct entirely? 15:21:20 14:38:27 It depends on your resources. If you can afford to gamble then no you shouldn't suppress it go off and have some fun if that's what you want to do. I think for most people you have to recognize that your life expectancy works exactly the opposite of the way you think it does. For example every year you get older you think your one year closer to end so I don't have to worry about my money as much, the truth is every year that you age your life expectancy goes up Yeah. Because you made it so that statically your likely to go a little further and a little further so you get to the point where your 60. The life expectancy of somebody who is 60 is longer then somebody who is 55 that's actual years you are going to make it. So the truth is when you get into your 70's you already have some measure of longer life expectancy then maybe you think, no as long as its long term and you have that long term need you need to be investing like that. 15:22:23 14:39:31 And finally if you're talking about stocks and bonds specifically what do you do, let me phrase it a little differently what are the worst mistakes that people make. 15:22:41 14:39:49 I think the worst mistakes that people had made had been that they didn't anticipate the danger and they didn't understand how bad things could get so they didn't protect themselves. Its one thing that, I have told the story of my father, my father in law didn't want o burden me with all of his financial decisions. So there was a particular stock that he owned that I had no idea about. Had I know, I was making the stupid investment of the week I would have told him, maybe this isn't the best thing for you to hold as I am writing that its about to go down by 50% and I was wrong it went down by 85%. So on the one hand the man died and achieved everyone of his financial goals, on the other hand this stock totally meaningless in the- did he achieve his financial goals lost 85% of its value and it bugs my wife ad it bugs me, because we of course know that he would have never wanted to do it. Thank goodness that it never came into play and I think that is what you see a lot of people doing is, ok I've got this thing, I'll expect it will come back, I think you need to figure out what your tolerance for pain is before the pain comes. 15:24:10 14:41:17 How do you do that? 15:24:12 14:41:19 What's the worst case- we have now lived through worst case scenarios. We now have lived through stocks falling 85%. So you buy something and you say what's maximum pain how much pain could I endure if I am wrong and once you say its 50% you know or 80% or 20% you get that thresh hold- I think you take a look and say can I endure any more pain. Am I getting to where either financially I can achieve my goals if this keeps going or I am now losing sleep at night and I think especially for many investors its that sleep factor that becomes the worry. If you can't endure more pain you've said I reached my pain threshold I'm out of here and I think that is a great time to sell. The wrong way to sell is, Oh my god look how bad its doing I'm going to sell right now and now you sold at the very worst time both from the marketing stand point and the emotional stand point. 15:25:12 14:42:18 Well you know very well especially in recent times that people panic when the market goes down dramatically. How do you avoid that? 15:25:21 14:42:27 Well I start by not getting to euphoric when the market goes up. Some how all the people who panic when the market goes down you've never heard anybody go, oh man the market was up 800 points today what a great thing. Right? The market was down 800 points what am I going to do, my entire investments are all horrible, nobody ever said, gee the market went up 800 points aren't I lucky today. 15:25:51 14:42:56 Jaffe talking into the camera. OK pick that one up. Pick that one up and put her on the roof. IF she let you could just put her on the roof. Talking about his cats. 15:26:05 14:43:12 I am going to ask you again. The story about your father in law was a little too involved. I'll say one of the worst ….OK? 15:26:15 14:43:22 What are the worst mistakes that people make. 15:26:17 14:43:24 Well I think for a lot of people what happens is that they get to a spot where they put blinders on. Where they assume things to be better and so they don't want to look and they wind up looking and totally freaking out because its now the worst case scenario they've ever seen and they sell at just the worst possible moment as opposed to entering things saying here's my down side, here's what I am willing to stomach, I don't expect- I don't think anybody buys an investment expecting the worst case scenario will happen to them. You would never buy it if you truly expected it to happen, but lay it out, here is what the worst case scenario is and then when you see it occurring your ready to go well I thought this was as bad as it could be this has reached the negative side of my expectations I'm out of here as opposed to, I'll ride this out and I'll hope and maybe it will get better and what have you. And I think the other the mistake that people make just horribly is they got to get back to break even as if break even is somehow guaranteed, break even is never guaranteed. 15:27:21 14:44:27 The market doesn't care when you got in and when you're going to break even. 14:44:31 15:27:24 And the market has no clue when you're going to retire, when your kids college tuition is due none of that if you happened to need your money tomorrow that puts you in a totally different circumstance then somebody who needs it in 10 years and the market doesn't care. 15:27:41 14:44:47 Chuck Jaffe thank you for joining us. 15:27:43 14:44:49 Always a pleasure Myron. |
| Intro Dennis Return to index of stories... |
OK. So you get a good advisor and you've developed a good plan. Should you stick with it? Especially when things aren't going well. Dennis Tsakiris, president of Wealthwise Financial Management says, "maybe." |
| Dennis Tsakiris Return to index of stories... |
15:07:18 Dennis let me ask you this question. We live in very turbulent investment times, how do you tell them to react to these big swings in the market? 15:07:39 Everybody that has a relationship with a financial planner, financial advisor needs to be able to feel free to pick up the phone and say Hey Dennis I've got a question here, I've got some concerns, lets meet let's get together and talk about that and that develops into an interview topically where you sit down and lay all the cards on the table and you say, hey listen where are you right now this is where you have your investments, this is we're your 401k maybe, this is where your Roth IRA's and really truly a value weight where you are and to make sure it's in your risk tolerance and that's what I think we are seeing a lot of the issues now Myron is people maybe beyond that risk tolerance or beyond their comfort level because we can't sleep at night when we wake up and look at our statements from your 401k's and that's troubling. 15:08:41 Well you know sleeping at night is a Maxum right, you should not invest in anything that keeps you up at night, buts that's easy to say. But what do you say to somebody who looks at that 401k statement and its way down from where it was a year ago and when the market was at its hype. 15:09:03 I got to tell you that's a tough phone call. It's a tough conversation, but what you have to do is once again sit down and say ok this where we are, we need to evaluate that is where you are right now. Should you be in stocks, should you be in bonds, should we be in bonds, should we increase the position in either bonds or cash or fixed. That's important because once again we are talking about risk tolerance at the same time keeping in mind your goals. Often times the conversation well listen my goals have changed a little bit I am now 3 or 4 years into retirement its prudent at that point to make sure you review your portfolio that you perhaps adjusted to a more conservative position, and that would typically be more the conversation that I would be having with my younger clients. Now my retirees and with all this type of volatility going on its quite different. Some are saying oh my goodness I am seeing my life savings drop in value and part of my job is to sort of separate the emotion and bring in some of the logic, lets revisit your portfolio, lets revisit your goals, lets talk about are you where you should be once again and do we need to make some changes, if we do decide if we are going to make some changes then lets develop a structured plan to do that. Now what we are seeing a lot out there is we are seeing a lot of knee jerk reactions, which is our emotion. We open our 401k statements and we say goodness! Things are not looking good here. 15:10:44 And sometimes there is panic. 15:10:46 There is absolutely panic. And I am finding that more than ever with a lot of my senior clients. 15:19:04 What about the question of asset allocation. 15:19:18 The best thing is to be able to go into a software program or whatever it happens to be using and come up with those niftily little pie charts that we all see and those are kind of cool and those are cute but what they do really tell you if you use them properly is exactly where your money is. Should you be there should you be in international stock, if you're a retiree and you have 15% over in emerging markets is that prudent, probably not so you really need to know that information or someone on the team has to be advising you to make sure that you are making those proper decisions so asset allocations absolutely especially in these volatile times as we all know we see it every day sometimes we hear the blue chips are up today emerging markets are down these are just styles of stocks, styles of investments some of them go up and down at different times and that allows us to perhaps cushion the fall if it does come down and that makes money in other areas as well. 15:22:19 Good advise Dennis thank you very much for joining us. 15:22:20 Its been a pleasure thank you. |
| Recap/Goodbye Return to index of stories... |
There's no one- size fits all when it comes to investing. Building a nest egg and preserving it takes time and patience. If you don't want to go it alone, do your homework and find a good advisor, make a plan and keep tabs on it. Know your risk tolerance, take the longview and plan for the unexpected. And, remember, if you can't sleep at night, then perhaps it's time for a change. I'm Myron Kandel. Thanks for watching. |
| Funding Credit Return to index of stories... |
More Than Money: An Investor Survival Guide has been made possible by a grant from the Investor Protection Trust and in association with the New Hampshire Bureau of Securities Regulation and the Center for Public Responsibility and Corporate Citizenship |
| Alternate Close Return to index of stories... |
There's no one-size fits all when it comes to investing. Building a nest egg and preserving it takes time and patience. If you don't want to go it alone, do your homework and find a good advisor, make a plan and keep tabs on it. Know your risk tolerance, take the longview and plan for the unexpected. And, remember, if you can't sleep at night, then perhaps it's time for a change. For more information on this program and links to interviews and resources, visit our website at nhptv-dot-org slash-money. I'm Myron Kandel. Thanks for watching. |
| Key: Economy Return to index of stories... |
NEW HAMPSHIRE OUTLOOK: SPECIAL Air Date/Time: 11/30/2008 HOST: Myron Kandel Length: 12:03 Building and Preserving your Nest Egg. An Investor Survival Guide. Now on New Hampshire Public Television. Hello Everyone. I'm Myron Kandel. Welcome to More Than Money: An Investor Survival Guide. I'm here at the historic Mount Washington resort in Bretton Woods, New Hampshire. The monetary system that was created here more than half a century ago is being revisited amid the world's current economic crisis. Individual investors have also gotten the message to re-examine portfolios and investment objectives.To help you do that we've put together a series of programs. In this program we'll focus on building and preserving a Nest Egg. We begin with a personal story. Beth Carroll shows us it's never too late to invest in the future. PRODUCER/REPORTER: Beth Carroll NAME OF PARTICIPANTS: Dee Lee\Certified Financial Planner, Marge Varnum\Planning for Retirement. |
| key: Consumerism Return to index of stories... |
NEW HAMPSHIRE OUTLOOK: SPECIAL Air Date/Time: 11/30/2008 HOST: Myron Kandel Length: 12:03 Building and Preserving your Nest Egg. An Investor Survival Guide. Now on New Hampshire Public Television. Hello Everyone. I'm Myron Kandel. Welcome to More Than Money: An Investor Survival Guide. I'm here at the historic Mount Washington resort in Bretton Woods, New Hampshire. The monetary system that was created here more than half a century ago is being revisited amid the world's current economic crisis. Individual investors have also gotten the message to re-examine portfolios and investment objectives.To help you do that we've put together a series of programs. In this program we'll focus on building and preserving a Nest Egg. We begin with a personal story. Beth Carroll shows us it's never too late to invest in the future. PRODUCER/REPORTER: Beth Carroll NAME OF PARTICIPANTS: Dee Lee\Certified Financial Planner, Marge Varnum\Planning for Retirement. |
| Key: Economy Return to index of stories... |
NEW HAMPSHIRE OUTLOOK: SPECIAL Air Date/Time: 11/30/2008 HOST: Myron Kandel Length: 14:22 Building and Preserving your Nest Egg. An Investor Survival Guide. Now on New Hampshire Public Television. Hello Everyone. I'm Myron Kandel. Welcome to More Than Money: An Investor Survival Guide. It's clear, investing in the future is something we all need to do, no matter how old - or young-we are. And, given all the instability in the markets it might not be wise to go it alone. What qualities then, should you look for in a financial advisor? I talked to Chuck Jaffee, senior columnist for marketwatch-dot-com, for some guidance. PRODUCER/REPORTER: Myron Kandel NAME OF PARTICIPANTS: Chuck Jaffee\Personal Finance Columnist. |
| key: Business / Industry Return to index of stories... |
NEW HAMPSHIRE OUTLOOK: SPECIAL Air Date/Time: 11/30/2008 HOST: Myron Kandel Length: 14:22 Building and Preserving your Nest Egg. An Investor Survival Guide. Now on New Hampshire Public Television. Hello Everyone. I'm Myron Kandel. Welcome to More Than Money: An Investor Survival Guide. It's clear, investing in the future is something we all need to do, no matter how old - or young-we are. And, given all the instability in the markets it might not be wise to go it alone. What qualities then, should you look for in a financial advisor? I talked to Chuck Jaffee, senior columnist for marketwatch-dot-com, for some guidance. PRODUCER/REPORTER: Myron Kandel NAME OF PARTICIPANTS: Chuck Jaffee\Personal Finance Columnist. |
| Key: Economy Return to index of stories... |
NEW HAMPSHIRE OUTLOOK: SPECIAL Air Date/Time: 11/30/2008 HOST: Myron Kandel Length: 4:44 Building and Preserving your Nest Egg. An Investor Survival Guide. Now on New Hampshire Public Television. Hello Everyone. I'm Myron Kandel. Welcome to More Than Money: An Investor Survival Guide. OK. So you get a good advisor and you've developed a good plan. Should you stick with it? Especially when things aren't going well. Dennis Tsakiris, president of Wealthwise Financial Management says, "maybe." PRODUCER/REPORTER: Myron Kandel NAME OF PARTICIPANTS: Dennis Tsakiris\Certified Financial Planner. |
| key: Business/ Industry Return to index of stories... |
NEW HAMPSHIRE OUTLOOK: SPECIAL Air Date/Time: 11/30/2008 HOST: Myron Kandel Length: 4:44 Building and Preserving your Nest Egg. An Investor Survival Guide. Now on New Hampshire Public Television. Hello Everyone. I'm Myron Kandel. Welcome to More Than Money: An Investor Survival Guide. OK. So you get a good advisor and you've developed a good plan. Should you stick with it? Especially when things aren't going well. Dennis Tsakiris, president of Wealthwise Financial Management says, "maybe." PRODUCER/REPORTER: Myron Kandel NAME OF PARTICIPANTS: Dennis Tsakiris\Certified Financial Planner. |
| Release Forms Return to index of stories... |
Have release forms -- Nest Egg - Margaret Varnum, Kelly Tour Choosing A Broker - Chuck Jaffe Money Bus Tour Manchester: NOT AIRED Jill Boynton, Susan John, Lynn Jones, W. John Dulmage, Maureen Demers, Sherrill St. Germain, and Robert Bartley. |