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About Jim Malliard

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So far Jim Malliard has created 26 blog entries.

Five Minute Gift

Five Minute GiftOne of the favorite gifts I received last Christmas was The Five-Minute Journal by Alex Ikonn and U. J. Ramdas. With this simple book, I begin and end each day by writing down daily goals, personal affirmations, “amazing things that happened today,” and areas for improvement. This daily five-minute gift to myself has been beneficial on many levels.

The exercise reminds me of one of my favorite high school teachers, a Cuban refugee and Spanish teacher, who encouraged us to write extensive notes as we studied for exams. That way, he said, we would be more likely to recall the material. It worked for me then, and the exercise of writing continues to help me decades later.

Scientific studies confirm that writing thoughts down significantly improves recall and increases the likelihood of accomplishing goals. It also can have a therapeutic effect. Given the documented benefits of journaling, including improved memory and health, New York Times columnist Hayley Phelan has gone so far as to call journaling “essentially a panacea for modern life.”

Written thoughts and goals are beneficial in all aspects of life, not the least being investment and financial planning. That’s why creating a written plan is one of the first tasks we complete with new clients. Clearly defining things like your goals and tolerance for risk, and the responsibilities of the parties involved (i.e. advisor, account custodian, fund managers) are fundamental elements of a good investment policy statement (IPS).

The IPS also includes an asset allocation plan for your portfolio. Your advisor performs periodic reviews of the allocation to help assure your investments are aligned with your plan. It’s also good for you to review the plan at least every few years to update or revise, if needed.

Give Yourself a Five-Minute Gift Each Day

Again, writing things down helps you remember what objectives are most important to you. It provides peace of mind knowing you have a plan. And it increases your chances of achieving your goals.

By |March 31st, 2019|Financial Planning|

Create a Vivid Written Financial Plan

How many times have you been told you’re more likely to achieve a goal if you write it down? More times than you can count? Probably. That’s because study after study has proven it to be true. Is it time to create a vivid written financial plan to achieve your goals?

Vividly describing your goals in written form is strongly associated with goal success. People who very vividly describe or picture their goals are anywhere from 1.2 to 1.4 times more likely to successfully accomplish their goals than people who don’t, according to Mark Murphy, CEO of Leadership IQ, a leadership training and research firm.

“Writing things down doesn’t just help you remember, it makes your mind more efficient by helping you focus on the truly important stuff,” Murphy stresses. “And your goals absolutely should qualify as truly important stuff.”

When you take possession of something – an item or an idea – you are more committed to it. Neurologists and psychologists call this phenomenon the “endowment effect.” Thus, writing down a goal gives you ownership of that goal. It becomes “yours,” a part of you, something you want to keep and protect.

That’s just one reason why we encourage our clients to have a written financial plan. It’s a way to vividly picture where you want to go and how you will get there.

We also encourage you to revisit that plan periodically – it’s not chiseled in stone; it’s a living document that changes and adapts as you live your life.

October is National Financial Planning Month.

Charles Schwab’s 2018 Modern Wealth Index survey shows that investors with a written financial plan tend to have greater fiscal discipline and better money habits.

Unfortunately, only 25 percent of Americans have a written plan. At Perspective Financial Services, about 50 percent of our clients have a written plan. If you don’t have a written financial plan, talk with your advisor about creating one.

By |October 22nd, 2018|Advisors, Financial Planning|

Successful Investors Keep Seatbelts Fastened

Successful Investors Keep Seatbelts FastenedLooking back two years, U.S. stocks have risen more than 30 percent. There have been occasional dips along the way, though the rise has been pretty much non-stop. The first week of February 2018 jolted investors back to reality, as stocks fell more than 10 percent in a short period of time. The numbers themselves sounded scary. The Dow Jones Industrial Average fell 1,800 points in a few days; it was easy to forget the drop was from record heights of 26,000. Since then, markets have recovered more than half of that unnerving slide.

Successful Investors Keep Seatbelts Fastened

It’s a challenge to remain calm during a substantial market decline for some investors. Once again, we have witnessed how important it is to block out “The sky is falling!” media warnings. Emotional reactions are likely to be detrimental for investors. The fact is volatility is a normal part of investing. It is always there. It’s interesting to note that we most often see the term “volatility” used when markets fall, and yet markets are “volatile” on the upswing, too, as we have seen for a good stretch of time.

Investors are well-advised to “stay in their seats with seatbelts fastened” when things get bumpy. Intra-year market declines are common, according to academic research by Dimensional Fund Advisors (DFA). Looking back to 1979, DFA found that about half the years experienced declines at some point of more than 10 percent. Despite those significant drops, calendar year returns finished positive 32 of 37 years.

The DFA study also determined that trying to avoid short-term losses through market timing is apt to hinder long-term performance. A substantial piece of long-term stock returns comes from just a handful of up days. An investor attempting to time the market is all too likely to be on the sidelines on strongly positive days. Through the period of 1990 to 2017, missing out on only the five best days cut returns by a full one-third.

As the markets jump and jolt, try to remain seated and relaxed. Better yet, get up and do something you enjoy. Go for a walk or out to a movie, and let the markets do what they will from day to day knowing that you have a long-term plan.

By |April 16th, 2018|Current Affairs, Investing|

Retirement Age Rising

Legendary singer Tony Bennett, who at age 91 still tours and performs for live audiences, has quipped, “It’s too late to retire.” More and more, Americans seem to share Bennett’s sentiment; they are postponing retirement and spending their golden years on the job. Recent studies show the average retirement age rising.

Retirement Age Rising

For men, it is just shy of 65 years, up from 62 in 1985. For women, since 1985, average retirement age has increased from about 60 years to 62. Today, about 20 percent of people 65 or older work at least part-time – the highest rate in 55 years. Among 70- to 74-year-olds, 19 percent work – that’s an 11 percent gain since 1994. The Bureau of Labor Statistics predicts if current trends continue, by 2024 about 36 percent of 65- to 69-year-old American workers will still be in the labor force.

While some older workers who delay retirement do so because they need the money, others continue working because they remain healthy, highly-skilled and happy at their jobs. A recent study by Transamerica found that 44 percent of later-retirees continue to work by choice. In other words, many people are working longer not because they have to, but because they want to.

“By the time you’re in your 60s and 70s, you’ve probably worked yourself into something you enjoy doing,” explains Jacquelyn James, an expert on aging at Boston College.

In addition to improved health and longevity, factors contributing to later retirement include:

  • changes to social security have improved incentives to keep working;
  • fewer workers are covered by traditional pensions;
  • people with more education tend to work longer; and
  • many jobs today are less physically demanding than in the past.

Older workers also tend to thrive in knowledge-based jobs – such as finance, law or business – according to Stanford psychologist Laura Carstensen.

By |October 23rd, 2017|Current Affairs, Retirement|