posted on April 26th 2016 in Austin CFP Team Posts & Your Financial Advisor with 0 Comments /

You’re intelligent, educated, and working toward success combined with a life balance and happiness. Things seem to be going well for the moment, but there’s an undercurrent of tension in your life with things changing, many future unknown variables, and time-constraints that limit your mental focus to the details and noise of today as opposed to your vision of the future.

I’m sure this sounds familiar, as I believe everyone experiences these emotions to greater or lesser degrees that vary from day-to-day.

There is a way to convert the TENSION to INTENTION and my role is to bring my experience, expertise, and fiduciary perspective to people to help them make this transformation with their lives.

How is this done? You have to have a PLAN: “an INTENTION about what you are going to do.”

A plan does not blindly focus on one thing like investments or insurance. That limited focus approach is of limited value.There are so many other things in life that will be important to a successful plan: sale of a business, tax-efficiency, estate planning, cash flow needs in retirement, taking care of family in the future, to name a few. A good plan should be holistic with a deep understanding of your needs, wants, and wishes, and should be maintained with guidance from a trusted fiduciary advisor.

It’s hard if not impossible to accomplish this on your own and the longer you procrastinate in changing your focus, the more risky your future becomes.

To enable the execution of the plan, WorthPointe has invested in the best planning tools available today, giving clients real-time, interactive, and holistic views and projections of their entire net worth. It’s up to me to provide leadership, insight, guidance and coordination for your plan.

There is of course the famous quote I paraphrase here by Field Marshall Helmuth Karl Bernhard Graf von Moltke (who probably insisted on repeating his full name and title upon introduction): “No plan survives contact with the enemy.” During his life in the 1800s, real-time communications were essentially non-existent, so this was a relevant perspective for him at that time. But things have changed a bit since then.

Which brings us to two essential points for planning today. First, the real-time information we can now have at our fingertips allows us to make better decisions. Second, to be effective the plan will need to be continually updated over time, and this can be done easily with the technology and tools we have in place. Both these points were not viable options for Field Marshall Helmuth Karl Bernhard Graf von Moltke.

Take my advice, if you will. Engage to begin the transformation from a life of TENSION to a life of INTENTION.

Simply put, this is what successful people do.


2016 Q1 Index Review


(Table Disclosures and Performance for periods greater than one year are annualized. Selection of funds, indices and time periods presented are chosen by the client’s advisor. Indices are not available for direct investment and performance does not reflect expenses of an actual portfolio. Past performance is not a guarantee of future results. Russell data copyright © Russell Investment Group 1995-2013, all rights reserved. The S&P data are provided by Standard & Poor’s Index Services Group. MSCI data copyright © MSCI 2013, all rights reserved. Barclays Capital data provided by Barclays Bank PLC.)

This was an interesting quarter for the markets, with the end of it providing some surprises. The most relevant conversation I had in the last several months regarded emerging markets. This individual had convinced himself that emerging markets were doomed. Boy did he miss out. It just goes to show you, you should not try to predict which particular stocks or asset classes to get in and out of. All of the pieces are important to the diversification strategy.

The broad U.S. equity market recorded slightly positive performance

for the quarter. Value indices outperformed growth indices across all size ranges. Small caps underperformed large caps. In U.S. dollar terms, developed markets outside the U.S. lagged both the U.S. equity market and emerging markets indices during the quarter. Small caps outperformed large caps in non-U.S. developed markets.  

The value effect was negative in non-U.S. developed markets using broad market indices. Large cap value indices underperformed large cap growth indices. The opposite was true in small caps; small cap value indices outperformed small cap growth indices.

In U.S. dollar terms, emerging markets indices outperformed developed markets, including the U.S. Value outperformed growth across all size ranges. Small cap indices underperformed large cap indices.

REITs in developed markets posted very strong performance for the quarter. U.S. REITs outperformed broad market U.S. equity indices.

Interest rates across the U.S. fixed income markets generally decreased during the first quarter. The yield on the 5-year Treasury note fell 55 basis points (bps) to 1.21%. The yield on the 10-year Treasury note decreased 49 bps to 1.78%. The 30-year Treasury bond declined 40 bps to finish at 2.61%. The yield on the 1-year Treasury bill dipped 6 bps to 0.59%, and the 2-year Treasury note declined 33 bps to 0.73%. The 3-month T-bill increased 5 bps to yield 0.21%, while the 6-month T-bill decreased 10 bps to 0.39%.

For the quarter, short-term corporate bonds gained 1.16%, intermediate-term corporate bonds returned 2.76% and long-term corporate bonds returned 6.83%. Short-term municipal bonds returned 0.71% while intermediate-term munis gained 1.55%. Revenue bonds slightly outperformed general obligation bonds for the quarter.

To wrap things up, I always stress that monthly, quarterly and even yearly performance numbers are just part of the noise only unsuccessful investors are transfixed on. It takes well over 10 years to reap the rewards of investing and if you can’t stick to the plan, you won’t get there.

In closing, remember, those with INTENTION will be better off than those IN TENSION. As I noted earlier, that is what successful people are able to do.

about the author: Morgan H. Smith Jr. IMBA CFP®

Morgan Smith Jr. IMBA, CFPMorgan H. Smith Jr. IMBA CFP, who has been a fee-only financial planner for over 12 years, specializes in wealth management for successful families, business owners, retirement plans and institutions requiring a disciplined fiduciary process.

An Assistant Professor at the University of San Diego, Morgan has been a frequent speaker to many professional organizations and has appeared on CNBC, Fox Business New Live and is a founding member of the Strategic Trusted Advisors Roundtable.

Learn More and/or Contact Morgan

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