As another wonderful Thanksgiving is approaching, I thought I’d use this week’s newsletter to enjoy a tongue-in-cheek situational laugh.
Every family has an “Uncle Rico.”
He’s predicted 17 of the past three recessions.
He’s predicted 35 of the five best-performing stocks this year,
and if you aren’t careful, you might find yourself taking investment advice from your well-meaning, fun-loving, pumpkin pie-devouring, former high school PE teacher uncle.
Uncle Rico is sly. He’ll find a quiet moment and pull up on you to share his favorite new stock app.
Unsolicited, he’ll provide 3-5 hot stock picks you must get in on.
After all, he’ll point out that his system predicted the rapid run in [insert best-performing stock].
**We’ve all been in this situation, and we’re just having some fun here – Uncle Rico means well, but…
Keep in Mind
- Uncle Rico likely does not have a written financial plan.
- It’s extremely unlikely Uncle Rico knows how much money he needs to be financially independent.
- Uncle Rico usually takes substantially more risk than required to adequately fund the plan (that he doesn’t have).
Closing the Loop with Uncle Rico
Option 1: Provide a boring nugget of wisdom.
“Uncle Rico, you know that my financial advisor shared with me recently? The worst rolling 30-year return for the S&P 500 is 7.8% annually.
Which means that $100,000 could be worth $951,837 in 30 years!”
Option 2: Offer Uncle Rico another slice of pie or a refill on his favorite beverage (proceed with caution; this could backfire).
Option 3: Check on the kids.
Option 4: Enjoy the solitude of doing the dishes.
What We Believe
- Acting upon a written financial plan is the ultimate safeguard to keep the barbarian of investment behavior away (acting emotionally upon Uncle Rico’s advice).
- Getting quality investing returns is NOT easy. Investment returns are earned. It takes faith, patience, and discipline.
- Your family’s dreams or vision of the future determine your financial plan. Your financial plan determines the portfolio.
- Your plan dictates how much you should allocate to growth, fixed income, and cash.
- We believe investment strategies should be low-cost & diversified.
If you or someone you’re close to could use help aligning their finances and establishing a financial plan, please reach out to us, we’re accepting new clients and eager to help.
10 Actions To Take 10 Years Before Retirement
In this paper we discuss 10 actions you should take to develop and deploy a successful long-term wealth plan. It will help you make decisions about your financial journey today and well into your retirement chapter.