Author: Richard Archer

Different groups of people have different financial needs. Business owners need assets that are more liquid and products to lower their liability. High earners need tax-minimization strategies. In the same way, women need specific products and services that fit their circumstances and goals.

While women are more likely to be the financial decision-makers in their families, they tend to have lower financial confidence across the board, particularly in the areas of investing and financial education. A Women and Wealth Initiative study found that 56% of women increase their confidence by working with a financial advisor. (1) With so much at stake, choosing a financial advisor is not a decision to take lightly. The financial advisor you choose to handle your family’s wealth will have a significant impact on your investment strategy, the fees you pay, and your confidence in your financial future.

When embarking on your advisor search, ask potential candidates these 10 questions:

1. HOW MUCH EXPERIENCE DO YOU HAVE?

Experience is essential when you’re working with a professional of any kind, especially someone handling your finances. Don’t be shy about asking an advisor about their industry experience. It will give you peace of mind to know what market conditions they’ve experienced and how many years they’ve been working in the industry.

Currently, 73% of women say they are unhappy with the financial services industry because advisors do not attempt to understand them and their needs. (2) No matter how much experience an advisor has, if they don’t have a track record of working with women, they might not be best suited to help you. Search for an advisor who wants to do more than just manage your investments, but who will listen to you, take the time to understand your goals and priorities, and educate you on essential financial concepts without using jargon or sales techniques.

2. DO YOU HOLD ANY CREDENTIALS?

Credentials and education play a critical role in your advisor’s competence. There are hundreds of designations in the financial services field and some are more applicable to your needs than others. (3) Some of the most important and useful designations include Chartered Financial Analyst (CFA), Certified Financial Planner (CFP), Certified Public Accountant (CPA), and Masters in Business Administration (MBA).

3. WHAT FINANCIAL PLANNING SERVICES DO YOU OFFER?

Not all financial advisors can provide comprehensive financial planning. Be sure to ask a financial advisor what services they provide and whether or not they have a specialty. For example, if you have children and know that you will need help with college and financial aid planning, find an advisor who specializes in that. Or, if you are curious about socially responsible investing, don’t choose an advisor who has little experience or knowledge in that arena.

4. WHAT IS YOUR PLANNING PHILOSOPHY?

It’s important to work with an advisor who shares a similar planning and investing philosophy as you. Multiple studies show that women take less risk with their money. (4) They seek stability over chasing returns and tend to stay the course when the markets go wild. Their goal isn’t to accumulate wealth as much as it is to achieve financial peace of mind. (5) Talk with an advisor about how he or she guides clients’ investing and financial decisions so you can have confidence that your needs and investment personality align with their philosophy.

5. DO YOU HAVE MANY CLIENTS LIKE ME?

Some financial advisors specialize in serving a specific demographic or level of investable assets, so you’ll want to find this out before choosing an advisor. Women approach money differently than men, and women in different circumstances have different financial needs. Whether married, divorced, widowed, old, young, a mother, a professional, or a housewife, you should work with someone who understands you and strives to serve you the way you deserve.

You face more risks to your financial future and need someone who can create a plan that addresses those threats.

6. WHO WILL BE WORKING WITH ME?

At some firms, you may work with different financial advisors depending on your appointment time or you may initially meet with a firm partner and end up working with a junior advisor.  Other firms may pair you up with one financial advisor with whom you’ll work consistently one-on-one. This is important to know ahead of time so you can make sure you’re going to get the personal service you’re expecting.

7. HOW MUCH DO YOU CHARGE?

Financial planning and investment costs can be confusing. Too often, financial advisors don’t readily disclose their fees. Fee-only financial planners are compensated directly by their clients for the services they provide and may be paid hourly, as a retainer, a flat fee, or a percentage of assets (AUM). For more information on the differences in compensation, click here.

Many women feel underserved by the financial planning industry. As such, they are more likely to want to know how much they are paying and whether the services are worth the price. (6)

8. DO YOU RECEIVE A COMMISSION?

Some financial advisors (many are with big Walls Street firms) earn their income from sales commissions. The problem is that advisors working on commission may be inclined to sell you expensive products that you may not need or understand.

9. ARE YOU A FIDUCIARY?

An advisor who serves as a fiduciary accepts responsibility to put his clients’ interests first and foremost in all decisions. A fiduciary is supposed to avoid conflicts of interest and remain unbiased in her recommendations and advice. There are many financial advisers now who accept fiduciary responsibility, so there is no need these days to settle for less.

Only 30% of women are financially literate, according to a 2015 Standard & Poor study on global financial literacy.  (7) This lack of financial understanding leads to only 10% of women expressing a high level of confidence that they will be able to retire comfortably (8) and 40% of women are uncomfortable even talking about money. (9) These factors put women in a vulnerable position. They desperately want to learn more about money and investing, but are worried they will be taken advantage of. Working with a fiduciary can ease some of these concerns.

10. HAVE YOU EVER VIOLATED ANY STANDARDS OR LAWS?

It’s a good idea to research an advisor’s credentials and run a background check with regulatory agencies. Some advisors may have been subjected to disciplinary action if they violated any laws or if a client took action against them. You can look up an advisor’s professional history by visiting FINRA’s BrokerCheck. This database will also show you the years of experience an advisor has and the licenses and credentials he or she has.

Take your time and trust your intuition when selecting your advisor. The relationship should feel right and you should never feel pressured to make a decision quickly. An advisor should be happy to answer these questions and any others you may have about how they operate.

About Richard

Richard Archer is a financial advisor and the President of Archer Investment Management with more than eighteen years of industry experience. Largely working with successful individuals and couples, he specializes in providing comprehensive investment guidance and personalized care and attention to each client. Along with holding a Bachelor of Science in Economics and a MBA, he is a CERTIFIED FINANCIAL PLANNER™ certificant and a Chartered Financial Analyst®. He combines his advanced industry education and knowledge with his genuine care for people to provide clients with an exceptional experience. To learn more about Richard, connect with him on LinkedIn or visit www.archerim.com. 

________

(1) https://www.businesswire.com/news/home/20151015005452/en/Women-Men-Solely-Responsible-Financial-Decisions-New

(2) http://www.etfcm.com/womenmoney/include/wadvisors-failing-woman.pdf

(3) Credentials Explained

(4) https://investors-corner.bnpparibas-am.com/investment-themes/retirement/why-women-typically-take-less-investment-risk/

(5) http://blog.amcpros.com/wp-content/LPL_Financial_Whitepaper.pdf

(6) http://www.etfcm.com/womenmoney/include/wadvisors-failing-woman.pdf

(7) Financial Literacy Gender Gap

(8) Women and Retirement

(9) http://www.chicagotribune.com/business/yourmoney/sc-cons-0312-marksjarvis-20150310-column.html

While many Americans are facing their retirement years completely unprepared, women face even more risk of outliving their savings than their male counterparts and are twice as likely to live under the poverty line in retirement. (1) As a result of this reality, only 10% of women are very confident they will be able to retire comfortably. (2) Why is there such a disparity? What are some unique retirement hurdles women face and how can they conquer them?

1. GREATER LONGEVITY

At birth, women are expected to live until 81, and men 76. (3) When saving for retirement, those five extra years could make or break your standard of living. But even with the average life expectancy being 81, one in three females could live until 90, while only one in five males will reach that milestone. (4) In the past 10 years alone, the U.S. centenarian population has grown 44%. What these numbers tell us is that women need even more resources to carry them through retirement. Women must also plan ahead for the likelihood of outliving their spouse.

How can we plan ahead to mitigate longevity risk when we don’t know how long we will live? The first step is to estimate your life expectancy, either by utilizing online calculators or by consulting with a financial professional. You may not be able to predict your exact lifespan, but you can determine an approximate range and plan accordingly. Once you calculate a few financial projections with an appropriate planning horizon, stress-test each projection for a longer lifespan. How do these estimations hold up if you live an additional two, five, or ten years? Evaluate the strength of your current strategies and decide whether or not you need to save more aggressively.

2. HIGHER HEALTH CARE & LONG-TERM CARE COSTS

Health care represents one of the largest expenses in retirement, but even more so for females. According to a study conducted by HealthView Services, women can expect to pay over $300,000 in health care costs, compared to the $260,000 average men pay. (5) These numbers are for healthy 65-year-olds, so if there are any known health concerns, that number will increase.

On top of standard healthcare expenses, an average 63% of people turning age 65 will require some form of long-term care during their lifetimes. (6) Furthermore, because of their longer life estimations, women pay significantly more for long-term care —$82,000, compared to just $29,000 for men. (7) These additional costs can eat away at your hard-earned savings very quickly.

There are two aspects to mitigating the risk of healthcare and long-term care costs. The first is to take care of your health now. Make sure you’re eating well, exercising regularly, and getting enough sleep every night. Getting regular health checkups and physicals help you detect problems early and improve your chances of living a healthier life.

Financially, you can review your options for long-term care insurance. Although policies can be expensive, they pale in comparison to long-term care costs. In 2007, the average long-term care insurance policy cost around $2,207 per year, (8) whereas long-term care can cost between $3,628 and $7,698 per month. (9) Instead of, or along with, long-term care insurance, consider starting a savings plan specifically for future healthcare needs. One option is to create a separate, high-yield savings account and contribute a specific amount every month.

By combining proactive physical care and dedicated financial preparation, you may be able to lessen the impact of healthcare expenses in your retirement years.

3. INCOME & WORKFORCE LIMITATIONS

Even in 2018, there is an income disparity between men and women. For every dollar earned by men, women earn $0.81 (10) and average annual Social Security payments are about $4,000 less for women. (11) Since women 80 and older receive an income that is 44% lower than that of men, it’s not surprising that three-quarters of the people in poverty are female. (12)

Women also spend more time out of the workforce to care for children or other family members. Not only does this impact earning power and Social Security payments, but also participation in employer-sponsored retirement plans. Females tend to contribute 7% of their income while men contribute 10%. (13) Over time, that 3% makes a considerable difference in savings.

Lower lifetime earnings often result in women claiming for Social Security benefits early, reducing the amount they receive by as much as 30%. (14) Before making Social Security claiming decisions, work with a professional who can walk you through different scenarios and help you choose the best strategy for your situation.

Finally, save early and often. Even though your income opportunities may not be as high as those of men, small amounts can add up over time. If your employer offers a retirement plan, be sure to participate and maximize your contribution rate to take advantage of any employer matching. Women tend to invest more conservatively than their male counterparts, so work with a professional to allocate your assets appropriately and determine your risk tolerance.

4. HIGHER DEBT LOADS

Women may make up 56% of higher-education students, but they hold 65% of the debt. Additionally, research shows that women pay more for the debt that they carry than men, even though they’re less likely to default. (15) As women try to pay off their debt, it limits their available assets they could be investing and putting away for retirement.

To mitigate the burden of debt, look for loan forgiveness programs that might be applicable to you and do your best to consolidate your loans. If possible, pay off the ones with the highest interest rate first and then throw all your extra cash towards the rest. Once your debt is paid off, all that money you were allocating to your payments will be available to put towards retirement savings.

5. LACK OF PLANNING

The Transamerica Center for Retirement Studies tells us that only 50% of women have some sort of retirement strategy, but 78% of American workers say they would feel more confident if they had a guaranteed income investment option. (16) As women generally take less risk than men, they may struggle more to feel confident in their planning options and, as a result, avoid planning altogether.

The key is to find a financial advisor that you trust and work well with. It’s never too late to create a plan, as long as you start today.

THE FUTURE IS BRIGHT

Women may have more work cut out for them to obtain their ideal retirement, but it is not out of reach. The earlier you plan and the more aware you are of the common problems or threats women face, the greater the chance you can achieve your goals.

At Archer Investment Management, we specialize in serving the financial and planning needs of women. We understand the unique challenges they face that can make financial planning more critical than ever for them. If you are nearing retirement and are worried about your financial situation, or if you want a second look at your current plan, click here to schedule a phone call.

About Richard

Richard Archer is a financial advisor and the President of Archer Investment Management with more than eighteen years of industry experience. Largely working with successful individuals and couples, he specializes in providing comprehensive investment guidance and personalized care and attention to each client. Along with holding a Bachelor of Science in Economics and a MBA, he is a CERTIFIED FINANCIAL PLANNER™ certificant and a Chartered Financial Analyst®. He combines his advanced industry education and knowledge with his genuine care for people to provide clients with an exceptional experience. To learn more about Richard, connect with him on LinkedIn or visit www.archerim.com. 

__________

(1) http://etf.wi.gov/news/WRS_news_012015/WRS_012015_art4.htm

(2) http://www.transamericacenter.org/retirement-research/women-and-retirement

(3) Social Security Actuarial Life Table, 2016.

(4) Key Findings and Issues. Longevity. Society of Actuaries, June 2012

(5) https://www.hvsfinancial.com/wp-content/uploads/2016/12/Women_Retirement_Health_Care.pdf

(6) https://longtermcare.acl.gov/the-basics/

(7) Society of Actuaries, “The Impact of Retirement Risk on Women,” 2010

(8) https://longtermcare.acl.gov/costs-how-to-pay/what-is-long-term-care-insurance/long-term-care-insurance-costs.html

(9) https://longtermcare.acl.gov/costs-how-to-pay/costs-of-care.html

(10) https://www.bls.gov/cps/cpsaat37.htm

(11)https://www.help.senate.gov/imo/media/doc/Senator%20Murray%20Report%20on%20Women%20and%20the%20Retirement%20Gap1.pdf

(12) Elayne Clift.  “USA Women Moving Millions”, News Blaze, September 16, 2008.

(13) https://www.transamericacenter.org/docs/default-source/resources/women-and-retirement/tcrs2015_sr_womens_retirement_outlook.pdf

(14) https://www.cnbc.com/2015/08/11/the-biggest-social-security-mistake-women-make.html

(15) Gender Gap in Investing and Finance

(16) https://www.transamericacenter.org/retirement-research/16th-annual-retirement-survey

If you’ve ever experienced buyer’s remorse after making a big purchase or felt embarrassed about the state of your financial affairs, you know that there’s way more to money than the number in your bank account.

Have you ever let fear of failure keep you from investing, or even creating a budget? If you have, you know firsthand how much of a role emotions play in our financial lives. Psychologists refer to these emotions and beliefs we hold about money as “money scripts.” (1)

WHAT DRIVES OUR MONEY HABITS?

No matter how hard we try to make only rational and well-thought-out financial decisions, we just can’t seem to do it. This is most likely due to the emotional and psychological baggage we carry around relating to our money, otherwise known as our money scripts. Before you beat yourself up about this, understand that these scripts start forming at a very young age.

Even if we aren’t aware of it, we spend our childhood watching our parents handle money, both positively and negatively. Over time our brains are unconsciously trained to respond in similar ways. If your parents were confident and wise investors, you will likely face investing with confidence. If your parents scrimped and saved and constantly fought over expenses, you may have strong feelings of guilt when making large purchases.

The seeds of money scripts are planted in childhood and grow to influence your financial behavior as an adult. For this reason, it is incredibly important to talk to your kids about money and model healthy financial behaviors. It is also vital for you to take the time to explore and understand your money scripts and how they influence your financial behavior.

THE BAD NEWS

While some money scripts are beneficial to financial health, others, like money avoidance, money status, and money worship, can be detrimental. Unhealthy emotions and belief patterns can lead to all kinds of financial problems, such as financial infidelity, compulsive buying, pathological gambling, and financial dependence. Certain money scripts have been tied to lower levels of net worth, lower income, and higher amounts of revolving credit.

Those may sound extreme, but have you ever let panic during down markets or overconfidence when they rally veer you from your long-term investing plan? Have you ever been unable to make a decision because you were paralyzed with worry and anxiety about the future? Have you ever put off something you know is important out of embarrassment or discomfort? Have you ever wreaked havoc on your budget for the momentary high of acquiring something you really wanted? All of these responses point back to your money script.

THE GOOD NEWS

We often think that if we had more money, we wouldn’t have any problems. But we have money problems because of how we approach money, not because we don’t have enough. This is good news! We might not be able to drastically increase our income, but we can learn to control our attitudes and perceptions. Our money scripts may be ingrained from childhood, but they are not permanent. With a focused and concerted effort, they can be changed.

Do you know what the biggest indicator of success is? Emotional intelligence, or self-awareness and self-management. (2) Before you can take charge of your money scripts, you first have to identify them. One way to do this is to be aware of your emotional responses to common financial situations. How do the following things make you feel?

• Earning money
• Buying things
• Saving for the future
• Budgeting and tracking expenses
• Making financial decisions
• Volatile markets
• Healthy markets
• Meeting with a financial professional
• Thinking about your financial future

Anything that elicits strong emotions warrants further reflection. Obviously negative emotions are not the only ones that can harm your financial life. Some positive emotions, like optimism and self-confidence, can bring about negative results if left unchecked.

HOW TO MANAGE EMOTIONAL MONEY DECISIONS

Learning to control your emotions is the key to changing your money scripts and developing healthier money habits. You can also build habits into your life that protect you financially, such as taking advantage of automatic saving and investing through your bank or employer’s retirement plan. You can schedule regular family budget meetings and enlist a friend or loved one for accountability. You can learn how you respond to emotional triggers and mandate a “cooling off” period for yourself before making any decisions.

Finally, you need to be willing to forgive yourself when you make mistakes. Leave the past in the past and move forward with the new knowledge you have gained. With discipline, self-reflection, and the help of those around you, you can reverse the money scripts that have plagued you and change the financial path for your future!

YOUR FINANCIAL PARTNER

An important resource to utilize on your journey of taking control of your finances is your financial professional, someone who can look at your situation from the outside in and help you navigate your finances without the emotional attachment you bring to the table. At Archer Investment Management, we provide comprehensive financial strategies through a highly tailored and hands-on approach. Our goal is to gain insight into your financial situation and empower you to make informed decisions. If you want the help of a professional to guide you through your financial life and overcome your money scripts, book an appointment now! 

About Richard

Richard Archer is a financial advisor and the President of Archer Investment Management with more than eighteen years of industry experience. Largely working with successful individuals and couples, he specializes in providing comprehensive investment guidance and personalized care and attention to each client. Along with holding a Bachelor of Science in Economics and a MBA, he is a CERTIFIED FINANCIAL PLANNER™ certificant and a Chartered Financial Analyst®. He combines his advanced industry education and knowledge with his genuine care for people to provide clients with an exceptional experience. To learn more about Richard, connect with him on LinkedIn or visit www.archerim.com. 

_________

(1) Money Scripts Predict Financial Behaviors

(2) Indicator of Success and Developing It

Ah…spring is in the air. The days are getting longer, the birds are chirping, the lawn mowers are busy, and many of us are getting out the cleaning supplies to make our houses sparkle. But it might be the case that more than just your home needs to be decluttered, cleaned, and organized. Do your finances need some spring cleaning? Getting your financial life in order may seem daunting, but think of it as a way to contribute to your own financial success. Consider the following tips to get started on the path of financial organization.

1. PASSWORD MANAGEMENT

Do you have a system for keeping track of your countless usernames and passwords? You’ll save yourself some headaches if you can find a method to keep all your information in one place. Plus, you’ll have the bonus peace of mind that your information will be safeguarded. There are plenty of online password managers to choose from, but however you decide to organize your login details, be sure to regularly update your passwords to protect yourself from hackers.

2. PROTECT YOUR IDENTITY

You don’t want to mess with identity theft. Not only can it cost you financially, but it causes undue stress, affects your credit, and could take years to resolve. Other than changing your passwords frequently, being cautious about releasing your personal information, and screening your emails, consider investing in an identity protection plan or credit monitoring service. If you experience the unthinkable, the professionals can take care of all the legwork and be your advocate.

3. GO GREEN!

Are you sick of all the paper that keeps piling up on your counters? Save a tree and get rid of clutter by enrolling in paperless document delivery for all your bills and financial services. Since you’re planning to create a password management strategy, the only thing you’ll need to do to access account details is find your login information and be on your way.

4. SCAN YOUR HEART OUT

Another way to prevent the mountains of paper is to scan all your paperwork to a digital folder. This allows you to clear the files out of your home but still do your due diligence and have copies of pertinent information. If you aren’t using a cloud storage program, be sure to have a backup plan for your computer.

5. REVIEW AND REVIEW AGAIN

Do you like the idea of simplifying? Your finances might benefit from this approach. Do you have multiple bank accounts that you could consolidate? What about extra cash lying around that could be invested? Do you have rarely used credit cards? All of these things can be streamlined. Also, take a second look at your spending habits and create a budget that will help you stay on top of your finances.

6. DIG INTO YOUR ESTATE PLAN

If you’ve done all the work to create an estate plan, it would be beneficial for you to review it every 3-5 years. This will keep it up-to-date with any changes, such as divorce, beneficiary adjustments, change in trustee, or a modified financial situation.

7. SEEK PROFESSIONAL ADVICE

A financial advisor is there to be on your side, helping you find ways to maximize your finances and meet your goals. If you don’t already have a financial plan, meet with your advisor to create one that is customized to your situation. This will allow you to map out when you want to retire, how you will pay for college, what socially-responsible investments are right for you, and how to fully fund your retirement and health savings accounts. If you are ready to streamline your finances and create comprehensive financial strategies for a secure future, schedule a phone call with us today!

About Richard

Richard Archer is a financial advisor and the President of Archer Investment Management with more than eighteen years of industry experience. Largely working with successful individuals and couples, he specializes in providing comprehensive investment guidance and personalized care and attention to each client. Along with holding a Bachelor of Science in Economics and a MBA, he is a CERTIFIED FINANCIAL PLANNER™ certificant and a Chartered Financial Analyst®. He combines his advanced industry education and knowledge with his genuine care for people to provide clients with an exceptional experience. To learn more about Richard, connect with him on LinkedIn or visit www.archerim.com. 

We all want to reach our financial goals, but sometimes we aren’t sure how to reach them. At Archer Investment Management, we are here to help put you on the path to financial success so you can get where you want to be. Watch this short video to learn about our holistic approach and how it gives you a better look at your finances so you can invest, save, and pay down debt intelligently. 

About Richard

Richard Archer is a financial advisor and the President of Archer Investment Management with more than 18 years of industry experience. Largely working with successful individuals and couples, he specializes in providing comprehensive investment guidance and personalized care and attention to each client. Along with holding a Bachelor of Science in Economics and a MBA, he is a CERTIFIED FINANCIAL PLANNER™ certificant and a Chartered Financial Analyst®. He combines his advanced industry education and knowledge with his genuine care for people to provide clients with an exceptional experience. To learn more about Richard, connect with him on LinkedIn or visit www.archerim.com.

Chances are your morning routine involved checking the news for the weather and traffic reports to plan your morning commute. You probably looked at your inbox and calendar to think through the workflow of meetings and tasks that are on your plate for the day. It’s likely that you will coordinate plans for this weekend, getting dinner with some friends or catching a game of your favorite sports team.

We often strategically plan every aspect of our daily lives, but what about the bigger picture? Do you have an updated and well-thought-out plan for your finances? A 2013 US Trust survey revealed that over 70% of investors don’t. (1) As an advisor, I see the tragic effects of this negligence often.

WHY DO YOU NEED A FINANCIAL PLAN?

What’s the point of creating strategies and plans for our lives? Because without a plan, we are shooting at a target blindfolded. Do you really want your financial life going astray because you didn’t have goals to aim for?

A financial plan incorporates short-term and long-term goals to transition you from where you are today to where you want to be in the days to come. Having a plan will help you get on track for your retirement so you can focus on today instead of worrying about tomorrow.

A Plan To Increase Wealth

Did you know that while approximately 96% of pre-retirees and 89% of retirees are concerned about their financial future, only 50% meet with a financial advisor to discuss their situation? (2) Meeting with an advisor doesn’t only give you confidence and peace of mind, it provides real results! The data presented in an HSBC study on the future of retirement shows us that those who created a financial plan amassed nearly 250% more retirement savings than those without a plan. (3) Are you convinced yet?

A Plan To Take Care Of The Details

Furthermore, having a comprehensive financial plan means that you have thought through the nitty-gritty details that are often overlooked, such as tax issues, health care, or legacy planning. You may think that financial planning is something you can put off for the future or hold off on until you have more money, but those who plan for their financial future are more prepared for their retirement, and this is true regardless of what you make. (4)

Now that you know why you need a financial plan, what will it look like for you?

YOUR FINANCIAL PLAN

Financial plans can address a myriad of concerns and goals, from college planning to retirement income strategizing. Depending on your needs, your plan may focus on one overarching element or multiple goals you’d like to achieve over time. Whatever you choose to focus on, your financial plan will provide a sense of understanding of where you stand financially and where you need to go in order to meet your goals.

When we sit down to assess your individual needs, here are some questions we will answer:

• Are you on track for retirement?
• Could you benefit from estate planning?
• Do you have adequate insurance coverage?
• Is there too much risk in your portfolio?
• Are you paying too much in fees?
• Have you started saving for your child’s education?
• Are there easy ways to reach your goals faster?

Take a look at this sample financial plan to get a better idea of what your financial plan could look like.

TAKE THE PLUNGE

Don’t be part of the majority who worries about their financial future, but instead, take the first step to a secure financial future and make a plan. If I told you that just fifteen minutes could make a significant impact on your financial future, would you take the plunge? You can conveniently schedule a complimentary fifteen-minute “Get Acquainted” phone call with me here and check out the stories of three clients we’ve helped! You won’t regret making a plan to set your finances on the right track.

About Richard

Richard Archer is a financial advisor and the President of Archer Investment Management with more than eighteen years of industry experience. Largely working with successful individuals and couples, he specializes in providing comprehensive investment guidance and personalized care and attention to each client. Along with holding a Bachelor of Science in Economics and a MBA, he is a CERTIFIED FINANCIAL PLANNER™ certificant and a Chartered Financial Analyst®. He combines his advanced industry education and knowledge with his genuine care for people to provide clients with an exceptional experience. To learn more about Richard, connect with him on LinkedIn or visit www.archerim.com. 

______

(1) http://doingmorethatmatters.com/wp-content/uploads/2013/09/2013-UST-Insights-Wealth-and-Worth-Full-Report.pdf

(2) https://www.soa.org/Files/Research/research-2014-retire-survey-findings.pdf

(3) http://www.hsbc.com/~/media/HSBC-com/about-hsbc/structure-and-network/retirement/pdfs/130905-life-after-work.ashx?WT.ac=HGHQ_FR_nr1.2_On

(4) https://www.cfp.net/docs/news-events—research-facts-figures/2012_household_financial_planning_survey.pdf?sfvrsn=2

Archer Investment Management is pleased to announce the newest additions to our team! As an investment management firm, we are always striving to offer exceptional service and focused, personal attention. Our goal is to have the expertise and experience needed to take care of our clients and help them on their journey towards financial peace. We believe that our new team members will help carry out our mission and leave you with even more confidence that your finances are in good hands!

TRACY COSTELLO, PRACTICE MANAGER

Tracy comes to us with over 20 years of experience working as a practice manager in a law firm, specializing in the areas of trust and foundation administration, domestic and international entity structures, and tax planning and compliance. Tracy is dedicated to guiding clients through the process of evaluating their financial position, setting goals, and implementing plans for financial security. In her free time, you can find Tracy exploring South Austin with her camera.

KELLY GOSIEWSKI, ACCOUNT ADMINISTRATOR

Kelly is our capable and knowledgeable account administrator. She spent 11 years in the U.S. military, and five years working as Director of Administration in the manufacturing industry. She decided to transition to the financial services industry, bringing her experience in operations, accounting, benefits administration, and recordkeeping. She excels at navigating the maze of paperwork required to establish and manage Archer Investment Management’s client accounts. When she’s not taming the paperwork dragon, you can find her involved in community and economic development efforts, serving on tourism and community development committees or volunteering in classes with Junior Achievement with the goal of empowering young people in their own economic success.

At Archer Investment Management, we take pride in developing long-lasting, meaningful client relationships. We offer comprehensive financial strategies for a secure future through a highly tailored and hands-on approach. We believe you will benefit from the passion and expertise Tracy and Kelly bring to our team and we hope you get a chance to welcome them! If you want to experience the difference Archer Investment Management can make in your finances, schedule a free 45-minute introductory phone call today!

About Richard

Richard Archer is a financial advisor and the President of Archer Investment Management with more than 18 years of industry experience. Largely working with successful individuals and couples, he specializes in providing comprehensive investment guidance and personalized care and attention to each client. Along with holding a Bachelor of Science in Economics and a MBA, he is a CERTIFIED FINANCIAL PLANNER™ certificant and a Chartered Financial Analyst®. He combines his advanced industry education and knowledge with his genuine care for people to provide clients with an exceptional experience. To learn more about Richard, connect with him on LinkedIn or visit www.archerim.com. 

I like being useful to others. It’s one of the reasons I became a financial advisor. And beyond my career, I am always seeking the opportunity to give back or serve others, especially in the Austin, Texas community that I love and call home.

Last year, one such opportunity to presented itself when I was invited to serve with the Metro Board of the YMCA, which provides direction for all the YMCAs in Central Texas. My initial thought was, “Do I want to serve on the board of a gym?” My free time was limited and I wanted to make sure I was giving back in the best way possible.

HOW THE YMCA HELPS AUSTIN

I soon discovered that I had no idea how much the YMCA actually accomplishes. While I could fill page after page listing all that the YMCA does, instead I’ll highlight a few of their initiatives I think make them stand out as an incredible organization.

• They’re building a new full-service, 85-acre campground, Camp Cypress, which will provide families with everything they need, including the tent, food, activities, and fun. Camp Cypress will be an amazing place for Austin families to visit for turn-key camping in nature within just 15 minutes of Austin.
• Through Project S.A.F.E., they aim to provide all area pre-k and first graders with education on safety, aquatics, and fitness activity. This is designed to help prevent drowning incidents as well as combat obesity among children. Since its launch in 2009, more than 11,000 children have gone through the program, saving countless lives!
• They offer a 12-week LiveSTRONG program and cancer support network. Survivors participate in free or low-cost customized exercise regimens catered to their individual needs from certified fitness instructors. The instructors are all trained in cancer survivorship, post-rehabilitation exercise, and supportive cancer care.
• Among the numerous programs they offer for young children, they provide early learning readiness for at-risk toddlers, year-round meals and sports for underprivileged and special needs Austin kids, and more.

I was blown away by how much the YMCA is able to accomplish and how many Austin community members they serve. In the midst of all the YMCA accomplishes every day, I needed to find where I best fit as a volunteer.

FINDING MY PLACE AT THE YMCA

The YMCA’s area of greatest need was on the Board Education and Policy committee, which was certainly a new experience for me since I’m usually quickly ushered to the Finance Committee. However, I was excited for the new experience.

After extensive board development training, I’m already helping this committee break new ground. We’re investigating partnerships with the New Philanthropists and two Univ. Of Texas MBA Fellows to help our boards become more economically and racially inclusive and representative of the vibrant and diverse Austin community.  

This project has turned out to be more involved and intricate than I expected. Identifying and cultivating new, high-performing board members and providing them an environment where they feel invited and will thrive alongside the YMCA is going to be a big job.

Despite feeling overwhelmed at times, over these last few months I have been on an unexpected journey as a volunteer that has me accomplishing important things that make me feel like I’m doing my part to make Austin better. I’m a proud Austin resident and I love that I have an opportunity to help my community thrive and serve those in need.

INTERESTED IN HELPING?

I’ve always found asking for donations to be awkward and uncomfortable, but I’ve learned that many of my clients who live in Austin and surrounding communities want to give back just as much as I do.

I encourage you to visit the YMCA of Austin’s website where you can learn about volunteer opportunities. Or, if you’re stretched for time but want to offer support, I have a personal fundraising website for the YMCA Annual Giving Campaign where you can donate a cash gift. Your funds will directly benefit one of the YMCA’s many programs. You can learn more and donate here.

About Richard

Richard Archer is a financial advisor and the President of Archer Investment Management with more than eighteen years of industry experience. Largely working with successful individuals and couples, he specializes in providing comprehensive investment guidance and personalized care and attention to each client. Along with holding a Bachelor of Science in Economics and a MBA, he is a CERTIFIED FINANCIAL PLANNER™ certificant and a Chartered Financial Analyst®. He combines his advanced industry education and knowledge with his genuine care for people to provide clients with an exceptional experience. To learn more about Richard, connect with him on LinkedIn or visit www.archerim.com. 

At Archer Investment Management, I’ve spent a number of years working closely with families who seek to send their children to college. In the past few decades, tuition costs have skyrocketed. When the average annual tuition for an in-state public college is $24,610, and $49,320 for a private college, planning far in advance is just as essential as it is for retirement, purchasing a home, and other significant financial goals.

I work with a number of families, many of whom are concerned about the nearly $100,000 price tag that comes with a four-year education. I’ve incorporated various services to help families plan for college. Here are three recent client case studies:

CASE STUDY #1: LONG-TERM COLLEGE SAVINGS

There’s never a bad time to start saving for college, and one couple I worked with started when their child was a newborn. This couple had high-paying careers and the means to save early. The husband Brian was a tech executive at Apple and the wife Betsy was a doctor who owned her own practice. They were concerned about their own graduate school debts and wanted to make sure their child didn’t have a burdensome amount of student loan debt as well. Additionally, the couple’s parents were eager to contribute to the college fund for their new grandchild.

Together, we first projected college costs at various public and private schools, with and without graduate school. This allowed us to set a reasonable range of possible future college expenses they would need to cover. We then incorporated these costs into their comprehensive financial plan to see how they impacted their current lifestyle.

From there, we helped them build a budget to see what they could reasonably afford to save.  For Brian and Betsy, it meant we also had to assess the best way for them to pay off their own graduate school debts while still being able to enjoy life and afford necessities. When you have multiple other bills, adding in a new savings goal can be tricky and requires careful planning to balance paying off debt while also maintaining liquidity.

Once we evaluated how much they could save each month for their child’s college tuition, we evaluated appropriate college savings vehicles. We also discussed how they can obtain life insurance at a low cost to protect their child financially and ensure her college is funded should the unexpected happen. Beyond college expenses, since Brian and Betsy were starting their saving early, we discussed the potential for saving tax-efficiently for the primary private school costs they expect once their child is in elementary school.

We also looked at opportunities for the grandparents to help. We encouraged one set of grandparents to make direct contributions to the college fund in lieu of physical presents for the child. For the other grandparents, we suggested accelerated gifting strategies. This was designed to work in their favor as they sought to lower their estate valuation to minimize future estate taxes and to take advantage of potential long-term tax-deferred growth.

By proactively tackling future college expenses, we were able to help this couple seamlessly integrate a new financial goal with their other goals and expenses.

CASE STUDY #2: PREPARING FOR APPROACHING COLLEGE COSTS

Often, parents start seriously considering college expenses when their child enters high school, and this case was no exception. This divorced couple shared a daughter Alexa who was a sophomore at a private high school when they realized it was time for college funding planning. They wanted to make sure to allow enough opportunity to implement their strategies before it became time to apply for financial aid through FAFSA.

This couple had a unique situation. They were divorced and had very different incomes, as the husband Eric was a self-employed artistic consultant while the mother Alana worked for a nonprofit. Our first step was to discuss the rules around determining the custodial parent and how it would affect Alexa’s projected financial aid. We also reviewed how a high-income family such as theirs can reduce their out-of-pocket tuition costs.

Next, we identified all the information the family would need to collect to complete their FAFSA paperwork and calculate their EFC (Expected Family Contribution).  They already had an idea of what kind of college Alexa would attend: an Ivy League to study Environmental Science, so we knew we needed to project costs for a private college with high tuition costs.

To do this, we reviewed their total expected cost of attendance at the five top schools they were considering. Next, we identified scholarships Alexa may be eligible to apply for at each of these schools. Through this process, we discovered she may be eligible for several significant merit scholarships if she could raise her GPA by just two-tenths of a point by the time she graduated high school. This gave her two years to work on boosting her GPA.

And although this family already had schools in mind, we helped them review several other schools they hadn’t previously considered that may fit Alexa’s goals better and offer them more financial aid. By reviewing these options, it helped the family potentially avoid the costs of transferring schools, changing majors, needless college visits, or attending a school that wouldn’t provide enough financial aid.

In looking at these new schools alongside their desired Ivy Leagues, we projected the various projected graduation debt levels and offered guidance on where they may qualify for more financial aid.

Beyond addressing savings needs and scholarships, we also evaluated student loans. We identified ongoing loans and tax credits they may be eligible for while Alexa is in school, and then estimated her starting salary at graduation (based on major and desired career) and the time required to pay off student loans.

To provide a more visual illustration, we set up a tool for them to track their ongoing student loan debt and repayment schedule as Alexa progresses through college. The system we use combines all of the loans into one place and helps them stay organized. By having this information, the family can more clearly see their projected loan repayment options and timeline.

This family intends on meeting with us again when Alexa is a senior in high school, as we can help them complete their FAFSA form, navigate financial aid roadblocks, complete and file the major forms on their behalf, and determine the fairness of the offers they receive. With this family, we are establishing an ongoing relationship where we can serve as their go-to guide for answers to their college planning questions.

CASE STUDY #3: TACKLING STUDENT LOAN DEBT AFTER COLLEGE

College planning doesn’t necessarily stop when college starts. Many people don’t realize the importance of college planning ahead of time, or simply were unable to do so. This means many must plan to pay off their college expenses after they graduate.

One client we worked with named Aaron was in this very situation. A recent graduate, he had just accepted a good technology job and it was time for him to start paying off his student loans. Like many graduates, he had a significant student debt load. It can be particularly difficult to make the required payments when you’re new to the workforce and just starting your career.

To start, we used our student loan calculator for Aaron. This tool organizes all of the loan information, calculates the loan repayment options, generates a personalized living expense analysis based on the individual’s income, and helps them start their financial future with greater clarity and knowledge.

We first calculated all eight federal loan repayment options and discovered that consolidating and refinancing his loans with a private lender would save him hundreds of dollars each month and allow him to fully pay off his loans within 10 years.

From there, we built a custom financial plan. The first component of this plan was a budget that factored in his expenses, including his car purchase, rent, travel plans, and loan repayment.

Next, we reviewed the best employer-sponsored benefits he was eligible for at his new job. We showed him how a high deductible health insurance plan for a young person can be a substantial long-term savings opportunity. We also looked at his 401(k) options, and found enough low-cost investment options in his plan to build an appropriate portfolio for his long-term retirement savings.

Lastly, we integrated this comprehensive plan online through a program that digitally links all of his student loans, bank accounts, and bills so he can track everything in one place. Aaron loves using the app on his phone so he can track his progress while on the go. In the end, he has greater confidence and visibility into his financial future and how to tackle his bills while embarking on his new tech career.

HELPING YOU

I work with a broad range of clients facing unique needs and circumstances. Whatever the situation, I strive to address them through a proactive process that focuses on understanding your personal situation, addressing your concerns, and creating strategies that help you work toward your goals.

If you’re experiencing a situation similar to one of these case studies or face an entirely different need, I encourage you to reach out to me. I can evaluate your situation and share how I can help. You can easily book an appointment with me online here. I look forward to speaking with you.

About Richard

Richard Archer is a financial advisor and the President of Archer Investment Management with more than eighteen years of industry experience. Largely working with successful individuals and couples, he specializes in providing comprehensive investment guidance and personalized care and attention to each client. Along with holding a Bachelor of Science in Economics and an MBA, he is a CERTIFIED FINANCIAL PLANNER™ and CFA^® charterholder. He combines his advanced industry education and knowledge with his genuine care for people to provide clients with an exceptional experience. To learn more about Richard, connect with him on LinkedIn or visit www.archerim.com.

If the thought of sending your child to college is making you sweat, don’t fear! While it is a major endeavor to get all the details in place, from choosing schools, navigating the application process, and planning for the transition, don’t let the worry about how to pay for all of it keep you up at night. In our last post, we provided an overview of the financial aid process and gave you ways to conquer the FAFSA. Now we are going to let you in on even more tips and tricks to maximize the financial aid your child could receive.

1. VERIFY HOUSEHOLD SIZE

The more people in your household, the better aid you will receive. If you have grandparents, nieces, nephews, or other family members living with you and relying on you for more than 50% of their support, you can include them in your household number. If you are expecting another child in the next school year, you can also include your unborn baby in the household size! Finally, if you have children who do not live with you but still rely on you for more than half of their support, they are also considered part of your household.

2. CORRECTLY REPORT YOUR BUSINESS

If you own your own business, be careful not to overvalue it on your application. Not all businesses are treated the same by FAFSA and the valuation could be quite low based on their criteria. For example, if you have small business with 100 or fewer full-time employees, you may not need to report your business at all!

3. CHOOSE WHO FILES

If you are divorced or legally separated, only one parent will file for financial aid. Since it can make a major difference in the aid received, make sure the right parent files. According to FAFSA, the custodial parent is the one who should apply, and that is the parent with whom your child has lived the most for the past 12 months. Ideally, the parent who makes the least money and has the lowest amount of assets is the custodial parent for financial aid purposes.

4. IGNORE COLLEGE LIFE INSURANCE

Many people aren’t even aware of college-oriented life insurance policies, but a salesperson may approach with this option. These policies often have high and unnecessary commissions and fees and have the potential to hurt your aid chances down the road, since utilizing these policies to pay expenses could increase your overall taxable income.

5. WATCH THE MARKETS

If you have a considerable amount of non-retirement investments, make sure you pay attention to the markets and file your aid application on a bad market day. This will lower the value of your assets and give you a chance to receive a better aid offer.

6. UNDERSTAND INCOME CATEGORIES

If your adjusted gross income is less than $50,000 and certain other criteria are met, (1) you do not have to share your non-retirement assets on the FAFSA. If you have found yourself without a job or underemployed, this can be a huge help in getting aid so your child can attend college.

7. STRATEGIZE GRANDPARENT CONTRIBUTIONS

If you are lucky enough to have parents who want to assist your kids with college, make sure you are smart about how you use that money. If a grandparent started a 529 account for their grandchild, that money will count as untaxed income for the student as soon as they take the money as a distribution. That amount could be assessed up to 50% in the aid formulas. Instead, grandparents can transfer ownership to parents where the amount will be assessed at the lower parent rate of 5.64%, or they can take a distribution in the child’s last year of school when the student will no longer be applying for aid.

8. COMPARE OFFERS

When you’ve completed the long, drawn-out application process and financial aid award letters start to roll in from your selected colleges, analyze the numbers. Your expected family contribution (EFC) should be listed on the letter, which will help you compare offers between the schools. If the award is much lower than the EFC suggests it should be, then it’s likely an inferior offer.

GET THE HELP YOU NEED

Applying for financial aid is not a simple process, but don’t let the stress and confusion stop you from making the wisest decisions and strategizing your application answers. Did you know that Archer Investment Management offers services to help you pay for college, including a specific Fafsassist package that will help you navigate financial aid roadblocks, complete and file major forms on your behalf, and help you determine which offer is best? We want to help you send your child to college with the best financial aid situation possible. Click here to schedule a phone call to get started!

About Richard

Richard Archer is a financial advisor and the President of Archer Investment Management with more than eighteen years of industry experience. Largely working with successful individuals and couples, he specializes in providing comprehensive investment guidance and personalized care and attention to each client. Along with holding a Bachelor of Science in Economics and a MBA, he is a CERTIFIED FINANCIAL PLANNER™ certificant and a Chartered Financial Analyst®. He combines his advanced industry education and knowledge with his genuine care for people to provide clients with an exceptional experience. To learn more about Richard, connect with him on LinkedIn or visit www.archerim.com. 

______

(1) https://www.edvisors.com/fafsa/secrets/reduce-adjusted-gross-income/