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Ameriprise Workers Find a 401(k) Plan Unsatisfactory – Their Own!

By Lon Jefferies | Published: November 1, 2011

Late last month, a group of workers at Ameriprise Financial Inc. filed a lawsuit in federal court against their employer, accusing the company of stuffing its 401(k) plan with expensive, underperforming mutual funds that came from the company’s own investment management arm. According to the suit, the company placed 401(k) contributions in proprietary funds that charged plan participants $20 million in excess costs.

The workers allege that Ameriprise and its committees, as the plan’s overseers, violated their fiduciary duty to the retirement plan. Investments in the 401(k) plan included mutual funds from Ameriprise subsidiary RiverSource Investments LLC, which is now known as Columbia Management Investment Advisers LLC. (Ameriprise seems to be developing a history of changing the name of their funds frequently to avoid having mutual funds with negative reputations. For example, Ameriprise funds recently utilized the RiverSource name for only five years).

According to the suit, “Defendants chose more expensive funds with inferior performance histories in order to generate revenue for Ameriprise. An investigation would have revealed to a reasonably prudent fiduciary that the RiverSource investment managers investing in RiverSource mutual funds were imprudent.”

The lawsuit highlights several concerns many fee-only financial planners have about their industry. First, as the majority of financial advisors work on a commission basis, there is always concern that advisors will direct their client’s assets into investments that pay the largest commission, not the investments that are necessarily the best option for the client. According to Ron Lieber of the New York Times, since the vast majority of Ameriprise’s revenue comes from investments in the company’s in-house insurance, annuities, and mutual funds, the firm’s success depends on advisors steering client investments into those products.

Second, there is always the concern (and in many cases, plenty of documentation) that proprietary investment options are excessively expensive and provide performance that is under par. In this case, the RiverSource target date funds used by the 401(k) plan cost investors .84% – .94% each year in fees, while a Vanguard alternative charges .10% -.18% in annual fees. Further, workers claim that the RiverSource funds lagged their benchmarks and received poor performance ratings from Morningstar Inc.

The lawsuit provides further support for the contention that fee-only financial planners are in a unique position to focus on what is best for clients. As fee-only advisors never receive commissions from the products they recommend, their job as fiduciaries is to concentrate on recommending the investments with the best performance records and lowest fees at all times. If you haven’t spoken with a fee-only financial planner to confirm you have cost-efficient, high-performance investments in your portfolio, call our office to schedule a complimentary consultation.

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Are You an Average Investor? (Hope You’re Not!)

By Lon Jefferies | Published: October 5, 2011

DALBAR, an independent research firm, recently published a 20-year study that illustrates how the average investor has fared compared to the market as a whole. According to the study, the average stock-fund investor has achieved an annualized return of only 3.83% from 1991 through 2010. Had these investors simply invested their money in the S&P 500 (composed of large U.S. company stocks) and forgotten all about it, they would have achieved a 9.14% annualized gain.

Keep in mind that investing solely in the S&P 500 isn’t maximizing the diversification in an investor’s portfolio. After all, the S&P 500 doesn’t include small and mid-sized companies, or international stocks. History tells us that over long periods of time, a diversified portfolio should outperform a non-diversified portfolio.

Even a simply buy-and forget strategy with bonds would have achieved greater returns than what the average stock fund investor achieved over the last 20 years. An investor who simply held the Barclays Aggregate Bond Index since 1991 achieved an annualized return of 6.89%, and encountered much less volatility and risk than the average stock investor was exposed to.

Consider the difference between an investor earning an average annual return of 3.83% as opposed to 6.89% or 9.14%:

$100,000 Invested At Different Growth Rates
Rate of Return

3.83%

6.89%

9.14%
10 Years

$145,622

$194,702

$239,794
20 Years

$212,059

$379,089

$575,014
30 Years

$308,805

$738,095

$1,378,854

Notice the growth in the funds invested at the 3.83% return that the average investor achieves. It should be readily apparent that a 3.83% return is simply not enough growth to provide most of us with anything near the retirement we strive for.

This study illustrates that investor behavior is the biggest culprit causing below average investment performance. No single mistake explains this poor performance. Rather, there are a combination of errors repeated over and over — mistakes that can be overcome by simply implementing and adhering to a disciplined investment strategy.

So how do we avoid being “an average investor?” Make sure to read the other article included in this month’s newsletter to learn about the most common, hurtful mistakes that the average investor makes. Beware: you’ll see that the majority of these mistakes are encouraged by CNBC and some of your favorite websites.

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8 Ways to Avoid Being an Average Investor

By Lon Jefferies | Published: October 5, 2011

The first article in this month’s newsletter reviewed a study by DALBAR that concluded the average stock investor had received a 3.83% annualized return from 1991-2010, while the S&P 500 generated a 9.14% annual return over the same period. The study concluded that investor behavior tends to cause investors to underachieve when compared to the market. Let’s look at the top eight mistakes the average investor makes.

Mistake 1: Excessive Buying and Selling

A study of more than 66,000 households found that investors who traded most frequently underperformed those who traded the least. For the study, investors were split into five groups based on their trading activity. The returns achieved by the 20 percent of investors who traded the most lagged the least active group of investors by 5.5% annually. Another study showed that men trade 45 percent more than women; consequently, women outperformed men.

Mistake 2: Information Overload
Those who monitor the market too closely have a tendency to undermine their portfolios with self-destructive behavior. Richard Thaler, a professor at the University of Chicago, conducted a 25-year study where he divided investors into three groups: one group who checked their investment performance every month, one that checked performance once per year, and one that checked performance every five years. The study concluded that individuals who checked performance the most frequently obtained the lowest investment return and were most likely to sell an investment immediately after a loss. Of course, selling low is not a good strategy for making money.

Mistake 3: Market Timing

History has shown that the market rises about 70 percent of the time. Market timers tend to find themselves out of the market during the 70 percent of the time it’s going up because they are trying to avoid the 30 percent of the time the market is falling.

Market timing is typically driven by emotion. Investors tend to buy stocks when they feel good and sell when they feel bad. Unfortunately, investors tend to feel good once the market has run up 20 percent and feel bad when their portfolio is down 20 percent. With the “feel good/bad” strategy, investors will always buy after the market has already gone up and sell when the market has already fallen.

Mistake 4: Chasing Returns
Guess which mutual funds attract the most new money each year? Money flows into mutual funds that have just enjoyed the greatest performance in the previous year. Unfortunately, investors are often late to the party with this strategy. For instance, in 1999 the Nicholas-Applegate Global Tech I Fund posted an unbelievable 494 percent return, and investors saw instant riches parading before their eyes. Yet, an individual investing in this fund at the start of 2000 experienced the following returns: -36.37% in 2000, -49.26% in 2001, and -44.96% in 2002.

It shouldn’t be surprising that chasing returns is a very common mistake. The entire financial media industry is built around a common theme: “Don’t Miss Out on the Ten Hottest Stocks.” When the fine print says “past investment performance is no guarantee of future returns,” believe it!

Mistake 5: Poor Diversification

You may have seen this mistake coming. Investors tend to be concentrated in one or two companies or sectors of the market. Over-concentration can damage a portfolio, whether the market is performing well or poorly. Poor diversification leads to excessive volatility, and excessive volatility causes investors to make hasty, poor decisions.

Mistake 6: Lack of Patience
Most mutual fund investors hold their funds for only two or three years before impatience gets the best of them. Individual stock investors are even less patient, turning over about 70 percent of their portfolios each year. It’s difficult to realize good returns from the stock market if you invest for only weeks, months, or even a couple of years. When investing in stocks or stock funds, investors must learn to set their investment sights on five and ten-year periods.

Mistake 7: Not Understanding the Downside
When you buy an investment, you should plan on worst-case scenarios occurring when you invest. It is true that past performance isn’t guaranteed to repeat, but it does give us an indication of what to expect on the downside. Know how your investments performed during recessions, wars, terrorist attacks, and elections. If you don’t understand the risks at the outset, you are more likely to react poorly during periodic market setbacks and get scared out of the market.

Mistake 8: Focusing on Individual Investment Performance Rather than Your Portfolio as a Whole
Ray Levitre, author of The 20 Retirement Decisions You Need To Make Right Now, said “One way to know you are diversified is that you will always dislike a portion of your portfolio.” If you are properly diversified, I can guarantee you that each year some of your investments will lag behind others in your portfolio. If you look at investments in isolation rather in context of your overall portfolio, you will be tempted to make poor decisions. You can get yourself into trouble by getting rid of investments when they’re low in value and replacing them with those that just experienced a nice run.

Conclusion
Most of these mistakes can be avoided by having a clearly defined, long term investment strategy. Before investing, develop a proper diversification strategy, a system for evaluating the performance of investments, and solidify your long term investment goals. Then, turn off CNBC and refer back to the systems and principles of your strategy when it is time to make investment decisions.

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Is a Roth Recharacterization Right For You?

By Lon Jefferies | Published: October 5, 2011

In 2010, many people took advantage of law changes enabling them to convert their traditional retirement accounts to a Roth IRA. The intention was to pay taxes on those retirement dollars in 2010 and enjoy tax-free growth going forward.

While this is likely still a sound strategy, the recent market downturn may provide a less expensive opportunity to do this. Consider the example of an individual in the 25% Federal tax bracket who converted $100,000 of retirement funds to a Roth IRA in 2010. In doing so, this investor paid $25,000 in taxes so that all future earnings in the Roth account would grow tax-free.

Now suppose this investor’s current account value has dropped to $80,000 during the volatile market we’ve experienced. An investor might argue that it was unfair to pay taxes on $100,000 of income when the asset is now only worth $80,000. Believe it or not, the IRS is willing to agree.

By recharacterizing the 2010 Roth conversion, both the investor and the IRS can pretend that the 2010 Roth conversion never took place. Essentially, the investor is converting the Roth dollars back into a traditional IRA account where taxes are again deferred and it’s like the Roth conversion never happened.  This eliminates the tax bill that was created by the original Roth conversion.

As most people have already filed their 2010 tax returns, they will need to file an amended 2010 return in order to eliminate the reference to the Roth conversion and receive a refund of any unnecessary taxes paid.

What if the investor still prefers the tax-free treatment a Roth IRA provides? Amazingly, the IRS provides an opportunity to still take advantage of these great investment vehicles. After 30 days have passed since the individual recharacterizes his Roth account back to a Traditional IRA account, the investor can against convert the funds back to Roth dollars. What is the advantage of this? Now the investor is paying taxes on $80,000 of income rather than $100,000. Assuming the taxpayer is still in the 25% Federal bracket, the tax bill would now be $20,000. Thus, by recharacterizing and re-converting, the individual lowered their tax bill by $5,000! 

The small hassle of this process may not be worth it if the tax savings will only be a couple hundred dollars. However, if you’re due to lower your cost by thousands of dollars, it is definitely something you should look into.

If you converted retirement funds to a Roth IRA last year, speak to your financial advisor to determine if you might be able to reclaim any unnecessary taxes you have paid. Notice: applications for Roth recharacterizations are due October 17th.

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Are 401(k) Loans a Good Solution?

By Lon Jefferies | Published: August 26, 2011

According to Bankrate.com, 19% of Americans tapped their retirement savings last year to cover the cost of an emergency.  Most people need to borrow money at some point, but is borrowing from a 401(k) plan the best solution?

Before you consider borrowing from a 401(k) plan, it’s a good idea to weigh the benefits versus the costs. Additionally, be aware that not all 401(k) plans allow employees to borrow from their accounts.  Check with your H.R. department before you even begin to consider a loan.

On the surface it may look very attractive to borrow from your 401(k) plan.  You can borrow up to 50% of your account value up to a maximum of $50,000. Further, borrowing from a 401k plan is unique in that you’re borrowing from yourself instead of from a third party.  The interest and principal that you pay goes back into your plan.

Here’s a simple example that illustrates what you’re essentially doing by borrowing from your 401(k) plan.  Assume that you place ten $10 bills in your right pocket.  You then transfer the bills to your left pocket and place an IOU for $100 in your right pocket.  Every month you return one $10 bill to your right pocket, and you utilize fifty cents from your piggy bank to pay the required interest.

As the example illustrates, the cost of borrowing from a 401(k) can be minimal. However, the individual in our example isn’t exactly getting ahead either. The problem is that you’re just shifting your own money around.  You are missing the opportunity to build your 401(k) from an outside source in the form of new contributions, employer matches, growth, interest and dividends.

Taking a loan from your 401(k) has other costs. Most plan administrators charge a fee to prepare loan documents. A large administrator in Utah charges $75 to set up an employee loan.  Worse, some employers won’t let you continue contributing to your 401(k) plan until the loan is fully repaid.  Thus, you could forgo matching contributions – one of the greatest benefits of an employee retirement plan.

To pay back the money, you must set up a strict repayment schedule.  The payback period cannot last more than five years (except for funds withdrawn for a home purchase), and you will typically make monthly payments using a reasonable interest rate – commonly the prime rate plus 1%.  Many employers automatically deduct the loan repayment from the employee’s paycheck – with after tax dollars! Of course, this negates another one of the greatest benefits of a 401(k) plan in that you no longer get tax deferral.

If you leave an employer while you have a loan balance, you have to repay the entire outstanding loan balance.  If you default on repayment, the IRS will treat the loan as a distribution. You will then be subject to income taxes and, if you are under 59 ½ years old, will have to pay a 10% penalty.

Before taking a loan from your 401(k), ask yourself why you want to borrow money. Reasons for borrowing money run the gamut from truly important things, such as medical expenses or buying a house, to things that merely feed our egos, such as hot new cars or exotic vacations.  If you’re borrowing to buy something nonessential, you should consider a different source than a 401(k) plan.  It’s not a good idea to replace appreciating assets (your 401(k)) with assets that depreciate.

Generally, I feel that a 401(k) loan should be considered only if it’s essential and all other financial resources have been exhausted. However, there are instances when a 401(k) loan can be a fantastic solution. For instance, I have a client who expects to receive an inheritance within the next few months. However, this client would like to purchase a new home immediately and needs funds for a down payment. It makes sense for this client to borrow from his 401(k) plan in order to cover the initial cost of the home loan and repay the loan in full once the inheritance is received. This enables this individual to borrow funds inexpensively but then not forfeit the great benefits provided by his retirement plan.

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Stock Market Craziness

By Lon Jefferies | Published: August 5, 2011

Dear Clients,

We wanted to touch base with you given the craziness in the stock market over the past week and hopefully provide some perspective which the press fails to report. Let’s look at the market drop from some other angles:

BONDS
Almost all of your portfolios have bonds in them. When you hear news that stocks are down remember that stocks only represent a piece of your portfolio. Further, if stocks are down, most likely bonds are up. This holds true during the past week — bonds have been up.

STOCK MARKET PERFORMANCE
The stock market is up 8.59% as measured by the S&P 500 over the past 12-months (as of 8/4/11). So, while it’s true that stocks have been beat up over the past week, they are still in positive territory for the past 12-months. Year-to-date the stock market is down 3.50%. Longer term the stock market is up significantly. Since March 9, 2009, just about two and a half years ago, the stock market is up 86.31%. Thus, even though the market is down recently it is up significantly over the past two and a half years.

BALANCED PORTFOLIO COMPARISON
By comparison, our portfolios that are comprised of 50% stocks and 50% bonds are up 8.29% over the past 12-months, and are up 0.53% year-to-date. Longer term our 50/50 mix portfolios are up 54.49% since March 9, 2009.

BUY LOW SELL HIGH
It’s funny, if I were to ask you how to make money in stocks you’d likely say, “buy low and sell high.” However, while this is easy to say it’s very counterintuitive. If you buy low you are buying something that is down in price, that nobody wants, that CNBC is saying is awful. Buying low is buying stocks now. Buying high is buying gold now. The average person buys high once an investment has gone up in value and the investor feels good. They generally sell after an investment drops and the individual feels bad. Of course, this is the opposite of what they should do. This emotional investing is the ticket to poor returns.

REBALANCE – BUYING LOW
A good way to take advantage of the recent stock market drop is to rebalance your portfolio. Since stocks have done poorly recently your stock allocation may be lower and your bond allocation may be higher than the targets we’ve set. For example, a portfolio that was 50% stocks and 50% bonds in January may be 45% stocks and 55% bonds now. My recommendation is to rebalance. This means, in this example, to sell 5% of the bond portfolio and add the money to the stock portfolio, bringing the portfolio back to the target weighting of 50/50. Please let me know if you would like to rebalance your portfolio.

BUCKET INVESTING
We typically position portfolios using a bucket strategy. “Bucket One” consists of the money you’ll spend in the next year or two. This money is in money markets or equivalents. “Bucket Two” consist of money that will be spent in years three to ten years. This is our bond money. “Bucket Three” contains the money that won’t be spent for ten years or more. With this methodology the money you have invested in stocks is money that we won’t begin spending for ten years. This means that if there is a stock market drop we have ten years to rebound. Time is on our side.

APPLE COMPUTER
Do you think Apple will be profitable over the next 1-3 years? In other words, do you think Apple will sell ipads, ipods, iphones, and computers? If the answer is yes and they are profitable, their stock will likely increase. Stock prices, while swayed by the noise of recent events, eventually reflect their true value based on a company’s profitability/earnings. I believe companies will figure out a way to be profitable even given the current craziness. If this is true then stock values will go up.

EXPENSIVE WORDS
The most expensive words on Wall Street are, “This time it’s different.” When we have stock market drops people – even the pros on Wall Street – tend to let their emotions get the best of them, and begin to believe that this market drop is different from previous market drops. We have always rebounded from stock market losses. Corporations have figured out a way to be profitable even when economic conditions have seemed insurmountable. I believe that this will continue to be the case. I believe that capitalism works and will continue to do so. If this is the case, then stocks will increase over time.

HOLD THE COURSE
As you might expect by now, we are bullish on the long-term, and believe that the best action to take right now it to stay the course.

We hope this was helpful as you battle the negative sentiment created by illogical volatility and sensational news reporting.

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What’s the Guaranteed Rate on Your Variable Annuity Really Worth?

By Lon Jefferies | Published: July 1, 2011

Have you heard of an investment that will guarantee a 5, 6, or even 7 percent return, and can return more if the market performs well? Actually, these claims are quite common in the variable annuity world. However, it is critical to realize that the guaranteed return is only half the story, and that the withdrawal rate attached to the annuity dramatically impacts the actual return achieved by the investment.

Moshe Milevsky has done some great work determining “the catch” of these investments. His entire report can be viewed here, but the following is a summary of his findings:

Growth Rates Aren’t The Whole Story

These products are called “guaranteed lifetime income benefit” variable annuities (GLIB VAs). The annual guaranteed growth rate, which is the rate touted by annuity firms to attract consumers, applies only to an income base. The income base is usually the equivalent of your original investment, plus the interest derived from the invested dollars at the annual guaranteed growth rate. This value is completely separate from the actual market value of the account, which fluctuates with the market. At set periods, an investor can choose to withdraw the actual market value from their account or annuitize the income base. If the investor decides he wants to annuitize the value of the income base rather than cash in the actual value of the account, he will receive a set dollar amount annually for the rest of his life. The dollar amount is determined by the withdrawal rate assigned to the contract. Withdrawal rates frequently range from 4 to 7 percent, and this figure is usually not made as clear and apparent as the annual guaranteed growth rate by insurance firms. Yet, it is crucial to understand that the withdrawal rate is different from the annual guaranteed growth rate, and every GLIB VA has both.

In order to take advantage of the annual guaranteed growth rate of as much as 7 percent, investors must first sacrifice the liquidity of their investment. After annuitizing, investors will never be able to access the lump sum of their investment — they will only receive annual payments for the rest of their life. Second, whether annuitizing is a good option depends on the withdrawal rate and how long the investor lives. If the withdrawal rate is low, which essentially limits the speed in which you can access your invested funds, the annuity’s actual return is lowered.

Not as Good as it Sounds

Let’s look at an example. Suppose a 55 year old invests $100,000 in a product offering a 7 percent guaranteed growth rate and annuitizes this product in ten years. The guarantee assures this investor he will have at least $196,715 by the age of 65. This number sounds great, but this is where the potential problem arises.

When you refinance your home, do you simply work with the bank that offers the lowest mortgage rate? Recently, banks started utilizing a trick where they offer obscenely low mortgage rates but charge a high amount of fees to process the loan. Homeowners are beginning to realize that when financing their home, they need to consider total costs, or a combination of the mortgage interest rate and the fees to generate the loan.

Similarly, a high annual guaranteed growth rate of return doesn’t do an investor any good if they are restricted by a low withdrawal rate. Suppose our hypothetical product stipulates a withdrawal rate of 5 percent. Thus, at age 65, the investor will receive 5 percent of $196,715, or $9,836 for the rest of his life. Again, this figure doesn’t sound too bad, but what rate of return is he actually achieving assuming he lives to his natural life expectancy? Following is a chart containing cash-equivalent returns for GLIB VAs with various guaranteed growth and withdrawal rates.

As you can see, our 65 year old investor whose annuity has grown 7 percent annually during the past ten years but is restricted to a 5 percent withdrawal rate will only earn 2.09 percent annually over the life of the investment. Don’t forget that these guaranteed income riders come with an additional cost – commonly 1 percent per year. Of course, this makes our actual achieved return even lower. Varying the investor’s age and the investment’s growth and withdrawal rates will produce a range of implied returns, but the actual return is always less than the growth rate highlighted in the policy. Why? As Mr. Milevsky puts it, “marketing materials speak the language of ‘investment Celsius’ to human beings who are hard-wired to understand ‘economic Fahrenheit.’ The numbers sound similar, but the scales are completely different.”

Do your homework when analyzing any annuity product. Speak to a fee-only financial planner who can provide you with objective advice. You may hear a different side of the story than what you hear from the commissioned sales agent promoting the product.

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Should You Stick With Stocks?

By Lon Jefferies | Published: June 23, 2011

It’s been an anxious few months for investors. Those nearing retirement have watched their savings erode as the Dow Jones Industrial Average slipped about 7 percent between April and June.

The drop reflects the souring economy. Unemployment has climbed back over 9 percent, home prices have fallen to 2002 levels, and the rate of U.S. economic growth has slowed. Meanwhile, European debt problems continue to rattle world financial markets.

With stocks wavering, is it a good idea for you to head for the exits? Find out what Ray LeVitre, founder of Net Worth Advisory Group and author of The 20 Retirement Decisions You Need To Make Right Now had to say about the issue in this month’s AARP Bulletin.

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The Square Dilemma

By Lon Jefferies | Published: June 1, 2011

Take fifteen seconds and count the number of squares you see in this image.

Do you believe that if you show this illustration to two other people, the probability that all three individuals will come up with a different answer is quite high?

There are actually 30 squares within the illustration: 16 individual squares, 9 squares made up of 2 x 2 individual squares, 4 squares made up of 3 x 3 individual squares, and the entire image itself is the last square.

What’s the point of this exercise? Even seemingly the most simplistic situations can be surprisingly complex, and a second opinion can shed new light on an old topic.

Net Worth Advisory Group offers complimentary consultations. Even if you are confident in your retirement planning efforts and your ability to design a top-level investment portfolio, speaking to a fee-only Certified Financial Planner may provide a new perspective to your situation and reveal ways to improve your financial future. Call to schedule an appointment.

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More Than Money

By Lon Jefferies | Published: June 1, 2011

People often focus their retirement planning efforts on meeting financial goals while neglecting other equally important issues. Relevant questions involve not just what financial resources you will have available, but how you will use your time during retirement.

Katherine Schlaerth, an associate professor emeritus at the USC School of Medicine, recently wrote an article for the Los Angeles Times called “Early Retirement is Hazardous to Your Health.” As a geriatrician, Dr. Schlaerth believes that working longer is generally a good thing. She has observed that patients who quit working are likely to gain weight, become hypertensive, and even develop depression. Her observations have been substantiated by several research studies: the Whitehall II study of British civil servants, a recent joint study by the Rand Corporation and the University of Michigan, and an Israeli study. These studies include the following conclusions:

  • Continuing to work reduces the risk of cognitive decline.
  • Both men and women in countries where people work longer have better memories.
  • Those who work longer have better health and are more independent.

To illustrate these conclusions, try solving this simple problem. If five people win the lottery and the prize of $ 2 million is divided evenly, how much will each winner get? In a recent study, half of Americans over age 50 gave an incorrect answer. Further, three-fourths of people over age 85 and almost everyone over age 90 answered incorrectly.

How can we apply the lessons from these experiments to retirement?

  1. Maintain an activity retirement plan. If possible, keep working. Some people can continue to work part time in their occupations. Retired people can serve as volunteers in various capacities. Pursing hobbies can be rewarding, but some are personal activities that don’t include essential interactions with other people.
  2. Avoid too much leisure. We can strengthen and lengthen our cognitive skills by keeping active.
  3. Aging will eventually decrease our reasoning ability, no matter how long we may be able to defer it. Designate a financial advisor or trusted family member to assist in handling financial matters while you are still able to make good decisions. This will not only benefit you immediately, but will also benefit a surviving spouse.

While I enjoyed lunch at the recent National Association of Personal Financial Advisors Conference in Salt Lake City, I met Jim from Fort Collins, Colorado. I discovered that Jim is eighty years old and still practices as a financial advisor. He is slim, trim, and mentally sharp. I’m sure him would agree with these three lessons.

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