The Full Field of View – Our Annual Financial Statement Update

You may have recently visited your doctor’s office because you had a sore throat.  Before they took a throat culture, it is likely they first checked your height, weight, blood pressure and heart rate.  Likewise, when dropping off your car for an oil change, a good (and honest!) mechanic will conduct a full vehicle diagnostic and provide necessary maintenance suggestions before handing back your keys.  Our annual financial statement update is similar to these techniques and comprehensive evaluations.  In order to successfully manage your investment portfolio, it becomes vital that we keep an eye on your complete financial picture.

Our financial lives can get complicated, risks may be unforeseen, opportunities may be neglected and sometimes even prudent planning breaks down as we get busy and forget to follow-through.  Effective wealth management integrates the numerous pieces of your financial life and helps ensure that little gets lost in the shuffle.

Our annual financial statement update is geared towards maintaining current details on the six central aspects of wealth management (see Figure 1).

The following list highlights a few examples of the pertinent financial information on which we are tracking and advising during these annual update meetings:

Investment Management

• 401k, 403b or other retirement plan investment allocation and performance
• Employer stock option vesting schedule and expiration dates
• Electing to receive pension proceeds as a lump sum or lifetime income stream

Risk Management

• Long-term disability coverage levels, tax implications and premium expenses
• Net cash surrender value and taxable earnings on permanent life insurance policies
• Private versus employer paid health insurance coverage features and expenses

Estate Planning

• Simple sweetheart wills or complex family and marital trusts
• Current legal guardians, trustees and beneficiaries of family assets
• Titling, ownership and transfer instructions on estate assets

Tax Planning

• Changes to your adjusted gross income trends
• How to balance your distributions from taxable, tax-free and tax-deferred accounts
• Choosing the appropriate assets for making deductible charitable contributions

Education Planning

• Investment allocation of 529 college savings plans and UTMA accounts
• Keeping up with rising college tuition costs
• Qualifying strategies for financial aid

Retirement Planning

• Determining when it is necessary to update your financial planning models
• Maintaining the appropriate targets for net worth, savings or spending rate
• The proper age to receive Social Security or other pension benefits

Our New Financial Report – Completing Your GHPIA Profile and Providing Your Total Net Worth

In addition to organizing the aforementioned pieces of your financial puzzle, we utilize our annual financial statement update to obtain current values and information on the following:

• Assets and liabilities
• Income and expenses
• Insurance policy details
• Copies of your tax returns, estate documents and outside account statements
• Future financial and personal goals

Once we have organized and updated this information, we will provide you with a comprehensive financial report totaling your net worth and highlighting your wealth trends at GHPIA (see Figure 2).

Our financial report is similar to the online wealth tracking tools (aka financial aggregators) like Mint or Personal Capital.  However, our report is distinguished from these online tools by not requiring your personal logins and passwords, and our report is better tailored to our preferred techniques of wealth management.  We will submit your updated financial report to you by regular mail or via our newly adopted online client portal, which offers greater security and ease in sharing documents back and forth with our clients.

As your financial life constantly evolves, your annual financial report bolsters our quest to provide you with cohesive, straightforward and prosperous wealth management strategies.  Beyond meeting with you regularly to review the performance and strategy of your GHPIA investment portfolio, we likewise periodically offer a third meeting to gather this broader perspective of your financial composition, update your financial statement and possibly identify areas requiring additional oversight.

Investment Insight is published as a service to our clients and other interested parties. This material is not intended to be relied upon as a forecast, research, investment, accounting, legal or tax advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The views and strategies described may not be suitable for all investors. References to specific securities, asset classes and financial markets are for illustrative purposes only. Past performance is no guarantee of future results.