What We Believe In
For me, I am truly a financial planner first and a portfolio manager only in the sense that investments will provide the funding for the overall financial plan. Investments, no matter the type (stocks, bonds, mutual funds, exchange traded funds, alternatives, etc.) or where they're held (IRA, 401k, trust, joint, 529, etc.) are merely one slice of the overall financial planning pie.
The first step in our process is determining what you're wanting to accomplish, how much time you’ve got to accomplish it, and what you already have in place to achieve these goals. Once we've completed this, we will then develop an investment strategy to help us to reach your goals. Then, and only then, I will work with my Investment Management Partner, Loring Ward, to design a portfolio (or portfolios) that will accomplish the goals we've set forth - based on historical rates of return, of course.
That's the easy part though. Once this is complete, I become your behavioral financial planner – helping you to continue to make good decisions about what to do – and what not to do – regarding your investments and personal finances.
I will never EVER say that the investments I recommend will “outperform” anyone else’s. It is certainly a possibility, but I will never promise it nor can any other financial planner – and to be completely transparent, investment performance doesn't have much of a connection with everything else that I will be doing for you.
My approach is goal-focused and planning-driven, rather than being based on some attempt to outguess the economy or the markets (which I’ll never do or make any attempt to do). I believe successful investing involves constantly acting towards the realization of goals, and all unsuccessful investing is based on reacting to whatever the markets happen to be doing at the moment (easier said than done for many individuals).
Once we are completely on the same page, our next step is to determine your most important financial goals. Then we will look at your financial condition and consider the time we have for each goal: when do you want to retire, how to pay off debt, automating your finances, and so forth.
Finally, we will figure out if there is any additional money you can add to your investments before you need to start drawing on them, and of course what other resources you can rely on. Once we have established all of this, we will then know exactly the appropriate portfolio - allocation - for each goal.
In my opinion (and it’s well documented), by far the most important factor determining the long-term investment returns people get in real life is their own behavior. So the issue for me isn’t predicting when markets will peak or bottom out – which no one can consistently do – but managing the way you respond to those periods of enthusiasm near market tops, and to the fear and hopelessness, which are very human reactions, around market bottoms.
I can promise that I will never try to predict when the next bubble will form (although I can say on average to expect one about every 5-10 years). However, I will make sure you never get overly exposed in the first place. I’ll also never try to pick a point at which the market might bottom. However, I will be working as hard as humanly possible to make sure you don’t panic out of a bear market when clearly the right thing to do is stick to your financial plan (and possibly investing more cash at rock bottom prices). This is the true definition and tremendous value of behavioral financial planning.
And because this is so important, let me reiterate: I cannot and will never guarantee your investments will be “outperforming” at any given moment (whatever your's or the media’s definition of outperforming is). But I can feel reasonably sure that you will be achieving better long-term results than most of your peers simply because I helped you avoid some of the very common human mistakes that most people make.
Your financial plan will always dictate your investments.