The Art and Science of Getting and Staying “On a Roll”
I love adapting engineering and physics concepts to solve common financial problems many people, even financially savvy people, encounter all the time. That’s why I’m so excited about my latest invention, the Wealth Allocation Wheel.
The challenge, in simple terms, is “staying on a roll.” There is an art and science to staying on a roll with your wealth. This means having enough inertia with your wealth to successfully navigate the Stages of Financial Freedom (see Illustration 1). The clear aim I have written about extensively is how to achieve controlled growth while avoiding short or long periods of stagnation or depletion.
Brady Siegrist, CFP, Managing Director of Wealth Management at Janiczek Wealth Management explains how the color-coded Wealth Optimization Dashboard, a key exclusive feature of Janiczek’s patented system, can help all clients, regardless of their net worth, business knowledge, age or investment savvy.
We monitor and measure things everyday. We glance at our speedometer to confirm we are not exceeding the speed limit. Thermometers tell us if we are running a fever or if our outside plants are in danger of freezing. A scale lets us know if an envelope requires extra postage. Think of all the diagnostic tests that report plusses and minuses of our physical well-being. How, then, do we measure our financial well-being? Why does financial strength matter?
Strength = Durability
Contrary to what some may assume, the number of digits it takes to record a person’s net worth is not an indicator of his or her financial strength. Size does not determine financial strength. Rather, durability is the measure of strength.
Carole McKeown has regularly rolled out new features of our service packages for 18+ years on the Janiczek® team. In this post, she highlights the features of J-Vault. J-Vault is an application that provides our clients with secure access to all their financial information from any device–desktop, tablet and even your smartphone!
We are aware some advisory firms serving high net worth individuals charge as much as $25,000 a year for an advanced online system that aggregates all of a client’s financial information. At Janiczek® Wealth Management such an application, J-Vault, comes standard with our services. We rolled out our J-Vault application, on a pilot basis, to several clients over the last year. We are excited to announce we will offer the J-Vault application to all clients over the next year.
Secure Current Financial Snapshot
Imagine…a highly secure location from which you can obtain a current financial snapshot on your smartphone. Yes! A complete balance sheet with liquid accounts updated with the prior day’s closing prices; a balance sheet so precise it has your latest checking account, credit card, and mortgage balances. And, of course, all investment accounts, retirement accounts and even private investments are included. A nice snapshot of where you are and that’s not all.
MLPs May Increase Portfolio Performance
Owning oil and gas pipelines can add octane to a portfolio’s performance, particularly in today’s energy and economic backdrop.
It’s our job to help clients gain the proper exposure to safety, market and aspirational asset categories. It’s also our job to identify pockets of the market that, when available, have attractive fundamentals and/or characteristics worth considering. Oil & Gas MLPs in the midstream space (storing and transporting energy) has caught our interest for years and remain an asset class of interest. While we take care of researching and handling the details for our clients, it doesn’t hurt for you to pipe into the conversation. Here’s a quick primer on the space.
Long-term strategies may challenge investors to stay focused. The fight against short-term thinking is getting harder as we accomplish so many things with increasing ease and speed.
There is more computing power in an iPhone than what NASA had during the first landing on the moon. Remember when Netflix mailed DVDs to your home? Now we can stream just about anything to our smartphones. And what would you have said ten years ago if I had told you the President of the United States’ main communication tool in 2018 would be Twitter?
But speed doesn’t change everything.
Janiczek community members recently enjoyed an evening of sushi rolling at Izakaya Den in Denver. Chef and Owner Yasu Kizaki taught twenty clients and employees about the history, types, and methods of rolling sushi.
“Everyone enjoyed meeting each other and we learned some fascinating things from a master of his craft,” said Brady Siegrist, partner. “It was a rather unique cultural experience.”
This year, the Janiczek team resolved to nurture personal and professional connections between community members.
“Many of our clients reside in the greater Denver area,” said Siegrist. “Our team plans to present future opportunities for clients to get to know one another. One of our goals is to explore topics and activities that seek to enhance life and living in some way.”
Whether discussing investments, longevity, or sushi, the benefits of connecting Janiczek community members can be powerful. Future events are in the planning stages, so if you are interested in learning more about the growing Janiczek community, let us know!
Books, Reading and Knowledge
“I read and read and read. I probably read 5 to 6 hours per day. I read five daily newspapers, I read a fair number of magazines, I read 10k’s, I read annual reports, and I read a lot of other things too. I’ve always enjoyed reading. That’s how knowledge works. It builds up, like compound interest.”
– Warren Buffett
In other words, reading opens one’s mind to bigger and better things. Another voracious reader, Bill Gates, recently shared his picks for some good summer reading. And who wouldn’t be interested in reading what a brilliant thinker like Gates found illuminating?
Of course, the Janiczek community isn’t short on good book recommendations either. In December, our team offered up some of our favorite books of the year, and our client community responded with some great picks of their own. (One client recommendation made the current Bill Gates list … great minds think alike, right?!)
So, as you begin your summer reading, whether to learn or to simply escape, we gladly share a few of our picks. Personally, I’ll be reading one of Bill Gates’ picks, Origin Story: A Big History of Everything by David Christian.
If you have book recommendations, by all means, let me know!
Book Recommendations from the Janiczek Team
One asset class has rebounded to new all-time highs — U.S. small cap stocks.
After a bullish 2017 and hopes of a continued global equity melt up, 2018 has instead reintroduced market volatility. Despite global market volatility, U.S. small cap stocks have rebounded to new all-time highs.
Factors influencing the success of U.S. small cap stocks
I’m not sure Yogi Berra is big source of investment knowledge for most investors. But, that doesn’t mean his words of wisdom, “déjà vu all over again,” don’t apply.
Today’s Wall Street Journal included an article titled, “Value Investors Face Existential Crisis After Long Market Rally.” It discussed the “rut” that value investing has experienced since 2009. No arguments there. Value stocks are down about 1% year-to-date while growth stocks are up nearly 8%. The tech-heavy NASDAQ Composite Index, which holds many of the favorite tech names among growth investors, is at its all-time high.
A Familiar Scenario
But as I sipped my morning coffee and read further, I didn’t ask myself how we should change our current value approach (for the portion of our portfolios dedicated to value investing) to match the current environment. Instead, I found myself thinking about earlier in my career, the late 1990s. Tech ruled the day from 1995 through 1999, and value investors lagged back then too.
“The Return of Volatility.” “Volatility Is Back With A Vengeance.” These are some of the headlines recapping the first quarter of 2018. Many of them
discuss volatility and risk interchangeably, as though they were both the same … but they’re not.
Risk and volatility are different, and we intend to set the record straight. In this issue of Portfolio Matters, we cover the first quarter’s risks and volatility that was (and wasn’t) witnessed in markets, and provide investors some clarity on thinking about the two individually and separately…read more.