by JEFFERSON ADCOCK, PARTNER
Watching the news or listening to financial podcasts every day, you can easily fall into the mindset that investing guides everything in life. At TrustCore, we turn that mentality on its head.
As holistic financial planners in Tennessee, we strive to understand what brings you joy in life and then develop the appropriate roadmap to help ensure you will have enough to live that ideal life. Investments are an important component of this roadmap, but we believe they are leveraged most effectively in conjunction with other assets and solutions.
Holistic financial planning looks beyond your investment portfolio to put processes in motion to realize your aspirations rather than simply hit numerical milestones. After all, saving $5 million for retirement is just a figure unless you place some context around it. How does such a sum apply to all aspects of your life, the lives of your immediate and extended family or business partners? At TrustCore, we approach financial planning as a comprehensive basket of decisions and actions meant to construct a life of purpose and meaning. Rather than simply strive for strong investment performance, we take a much broader view of our role as a financial planner.
We believe this holistic approach can benefit you in several ways. Because the term “holistic financial planner” is new to some people, we wanted to share a few facts.
Prudent Cash Management
You have surely heard the saying, “cash is king.” We would tweak that to “cashflow is king.” Whether you are a business owner balancing an optimal exit strategy with current personal expenses, or an executive with concentrated stock positions approaching retirement, everyone needs access to a reliable stream of income for day-to-day spending and to enjoy the here and now.
A holistic financial planner can help you integrate your assets to generate long-term growth while producing regular cashflow in the most tax-efficient manner. This could mean allocating a portion of your investment portfolio to dividend-paying stocks and taking distributions in cash, building a ladder of Tennessee tax-deferred municipal bonds, or designing an asset dedication strategy.
When you put yourself into a cookie-cutter plan, your personal interests can be put on the backburner.
Preparing for the Inevitable Rainy Days
As holistic financial planners at TrustCore, our team assesses the risks as well as the rewards of investments and other financial assets when implementing a financial plan. We believe this has many benefits.
Portfolio management can balance the potential for growth while seeking to minimize volatility through an asset allocation geared to your goals and risk tolerance. Diversification is a time-tested approach for spreading risks across a number of distinct investments that behave differently in varying market and economic conditions.
For some TrustCore clients, we take the strategy of diversification a bit further by utilizing alternative investments where appropriate. Alternatives are investment vehicles found outside traditional single security, mutual fund and ETF wrappers and that are influenced by different factors than those that impact traditional investments. Examples include hedge funds, private equity, real estate investment trusts, commodities, reinsurance contracts and peer-to-peer lending, to name just a few. If you take this route, it’s important that you work with a financial planner who has in-depth knowledge in the alternative-investment space and can help you understand the benefits and risks of each investment type based on your specific needs.
At TrustCore, we have this experience!
As holistic financial planners in Tennessee, the TrustCore team realizes that investments are often the least of their clients’ worries. For the family of a small business owner, for example, the untimely death or disability of the founder or the filing of a liability lawsuit against the business could lead to financial distress if the proper protections are not in place. TrustCore maintains an independent insurance agency that holds longstanding relationships with a variety of major insurance carriers providing life, disability and business risk policies.
The key to a holistic approach is getting started!
Keeping Uncle Sam at Bay
When it comes to financial planning, it’s also crucial to understand the difference between gross and net as you develop tax-managed investment portfolios as well as estate, trust and gifting strategies to minimize your tax liabilities. With increases to capital gains and business tax rates on the agenda of the new administration in Washington, now it’s especially critical and timely to have a tax management solution in place ahead of pending tax changes.
The Takeaway
Retirement planning can be confusing, overwhelming, even scary. As an “easy” way to get started, many people find themselves adapting a basic, age-based approach to investing. When it comes to important decisions, like when to take Social Security benefits and when to retire, they take advice from family members, friends and coworkers. They take a set-it-and-forget-it approach and assume everything will work out on its own.
That can be dangerous.
Are your retirement plans the same as your friends’? Is your family make-up the same as your coworkers’? Do you have the same fears and obligations as your neighbor?
Everyone’s financial situation and family structure is different. Your retirement plan should be too!
If you’re looking for help in creating a holistic financial plan, contact the TrustCore team. Our holistic financial planners in Tennessee can help, whether you’re local or nationwide. Start the conversation.
Important Information and Disclosures
Readers are encouraged to conduct their own independent research. This information is intended to be limited in scope and provide basic educational information on presented topics. Data represented is believed to be from reliable sources.
TrustCore makes no warranty concerning such information. TrustCore expressly disclaims all representations and warranties that: (a) the content is correct, accurate, complete, or reliable; (b) any of the information will remain available for any amount of time or in any medium; and (c) that any omission or error will be corrected. The information contained in this presentation should not be considered a solicitation, offer, or recommendation for the purchase or sale of any securities, other financial products, or services and should not be regarded as a description of services offered by TrustCore. TrustCore shall not be held responsible or liable for any damages or losses, whether direct, indirect, incidental, special, consequential, or exemplary, that arise or result from the use of such information.
The information contained herein is presented with the understanding that the individual authors, presenters or organizers are not rendering financial, legal, accounting or other professional advice or opinions on specific facts or matters, and accordingly assume no liability whatsoever in connection with its use. The foregoing information should not be regarded as offering a complete analysis or opinion on any provision of local, state or federal law. You should not attempt to implement any of the planning strategies set forth in this content without first obtaining competent, professional advice from a qualified individual or firm.