Financial Advisor News

Piedmont, CA

Financial Advisor News

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Piedmont, CA

by: ALISON VAN DYKE

FIRST AND MAIN FINANCIAL

(510) 601-1935

Oakland, CA | East Bay; Q3 2020 Market Summary and the Upcoming Election

We presently live in a country where, unless we shun it, we’re constantly bombarded with someone else’s narrative. Wherever you fall on the political spectrum, unless you try to focus more on practicable solutions than fear; TV, social media, print media and our most elite universities are constantly driving home a message and it either makes you feel good, or, afraid of the “other” side.

Newspapers and TV shows are driven by profit. If they can overwhelm and engage their audience with messaging that makes them more committed to ideas that make them feel good, while mistrustful of opposing views (more tribal), they sell more adds and make more money.

This is not new.

Print and on-line newspapers are battling for their lives due to low barriers to entry for alternative news sources. They need to grab and hold your attention to survive.

Social media and the internet have been around for a nanosecond with respect to the history of humankind and thus our brains aren’t evolutionarily wired to deal with the speed and consequence of what might go on in that space. The artificial intelligence algorithms directing content to social media users are relentless in pushing whatever gets one too look and keep looking. If one shops for information with a narrow band of interest, one will mostly get content pushed in that band.

These days, to many, the things they believe according to what they’re shown by the places they shop for information seem totally certain. There are kernels of truth in the different narratives but given the nature of what’s available to us one must, unfortunately, make extra effort to formulate broader perspective and find irrefutable facts.

I delved into this because we’re about to have an election where we’ve reached an incredibly deep divide between the political factions and we regularly get calls, have conversations, or are told by different clients that they want to wait until after the election to consider investing more money, or, maybe they should take some money out of markets given the apparent craziness. Whichever side one is on they likely think things will be really bad if the other side wins.

We received a lot of clients after the last election when economic results didn’t align with expectations. Then as now many people would rather not have a connection to the stress of having to make decisions about how their money will be invested and so it’s our ethical imperative to try to stay connected to base facts and maintain a broad and reasonable perspective.

This is an ongoing endeavor requiring constant focus and we’re always searching for new information to help us better serve our clients.

The economy is coming back after being shut down. Unemployment is at an extremely reasonable level (7.9%) given the immediate and severe shock to the system. We came into the pandemic in one of the most stable and positive economic environments ever in the history of our country. Unemployment was the lowest in over 50 years while growth was decent and inflation contained with no signs of excess in markets or in our economy. This is called a goldilocks economy.

Depending on one’s information sources the situation may seem much worse than it is. The situation is not great, and many people are hurting, but The Federal Reserve Bank and our government have made strong efforts to keep the train on the tracks while things get reconfigured to a certain degree.

Markets have done quite well and one simply can’t argue with the consensus determined by trillions of dollars all directed with the incentive to profit, not lose.

We don’t know what the election will bring but unless the person who winds up in office tries for a massive wealth transfer, my guess is most of us will keep waking up every morning with basic human needs, and there will continue to be people and companies to fill those needs. Global economic progress will likely thus continue. Global economic progress has lifted about a billion people out of poverty over the last decades.

As always, we appreciate the trust you put in us to manage your investments. We are always available for a conversation should questions arise.

Sincerely,

Erik S. Wolfers, MBA, CFP®

Oakland, CA | East Bay; Which Factors Contribute to a Healthy Retirement?

Hi, I’m Erik Wolfers. I’m the founder and managing member of First & Main Financial. We’ve been helping clients get through retirement since 2001. Today I want to talk a little bit about a longevity; and this specifically pertains to when people are in retirement or their “golden years”.

I go to a continuing education conference every year, and this year I sat in on a talk with a gentleman from the Longevity Institute at Stanford in which he highlighted four factors that have been shown to contribute to a long and healthy life. I wanted to share them with you.

One is connectedness—it’s not good to be isolated when you get older. You want to have a certain number of people you connect with regularly, that you have deep meaningful relationships with. It doesn’t have to be a lot of people—I can’t remember what the magic number was, but it’s less than 10, possibly even less than 5, depending on a person’s personality.

Sleep is critical for everyone, especially when you get older—you need to get adequate sleep so that your body can restore itself; there’s a big wave these days of using breathing devices to help people make sure they get enough oxygen.

Activity when you get older is known as a good for everyone in health and life. You need to be active and it doesn’t necessarily have to be super vigorous activity—but people need to get up and move and move regularly and go for walks, that kind of a thing.

The last thing is sitting. Sitting has been shown to shorten people’s lives if they do it too much.

So again this was research from Stanford and I’m sure there is other great information out there. The Stanford Longevity Institute is good resource. I wanted to share because if you spend your whole life saving money and generating good investment returns, you want to have a good life once you are able to not work anymore.

If you are looking for some financial guidance; whether for a one time financial plan or continuing advice on your investments, we invite you to meet with a First & Main Financial planner for a free consultation. We would be more than happy to sit down with you, assess your situation and review our services to help navigate your financial future.

Oakland, CA | Piedmont; Financial Planning and the Emotions of an Inheritance

Hi, I’m Erik Wolfers. I’m the founder and managing member of First & Main Financial. We’ve been helping clients get good outcomes with their personal finances since 2001. We operate as fiduciaries, where our only objective is to do what’s best for our clients and help them get the best outcome depending on their circumstances and the preferences.

Today, I want to talk a little bit about inheritance. Periodically we have people come to us who have inherited money and it’s an interesting human dilemma—people sometimes have different emotions, different feelings about getting money from someone who they love, and there always seems to be a kind of natural confusion about the taxability.

If you inherit something that was a taxable asset, something sitting in a living trust possibly or a piece of real estate, you get a step-up in basis. Whatever the cost of the asset was to the person who originally acquired it, when they pass it to you, the cost is now the current cost. It can be sold without any taxable gain or any tax consequences to person inheriting the money. Life insurance is also tax free.

We get a lot of clients who inherit retirement accounts and there’s confusion about what to do with those kinds of accounts. Mostly clients open up what’s called an inherited IRA or beneficiary IRA and the assets go into that account. They can take all the money out if they like, and the withdrawal will be fully taxable as income on their taxes.

The rules have recently changed with IRAs. It used to be you could spread the distributions out over your lifetime if you wanted to take it out slowly as possible. Now it has to be taken out within 10 years. But you don’t have to take any out until the 10th year, thus allowing the money to grow and also avoiding any tax consequence of pulling the money out on an annual basis.

We’ve been through it a lot with our clients. We understand that it can be a confusing time and a stressful time with respect to making decisions, or how to feel about the money for those who have inherited it. But it can be made very simple if you’re getting help from someone who has your best interest at heart. It can be a painless process and hopefully a lot of good can come from it.

If you are looking for some financial guidance; whether for a one time financial plan or continuing advice on your investments, we invite you to meet with a First & Main Financial planner for a free consultation. We would be more than happy to sit down with you, assess your situation and review our services to help navigate your financial future.

Oakland, CA | East Bay; Financial Planning and Investing for the Long Term

Hi, I’m Erik Wolfers. I’m the managing member of First & Main Financial. We’ve been helping clients achieve positive financial outcomes since 2001.

Today, I’m going to talk a little bit about the long-term. When we’re investing for a client, we are investing for their entire life; it could be decades. We just recently got a client in his early twenties and so he has decades to invest—and positive movement for clients when they’re young or throughout their lives with respect to their investment portfolios, can make an enormous difference in their well-being and also in the outcome that they achieve.

One has to have a long-term perspective, the perspective of the individual, the holistic perspective, because we do go through periods of adverse market conditions or bad economic cycles. Right now, we’re just clear of the most rapid drop ever in the history of the stock market with a recovery that’s unbelievable to some people—but the stock market has recovered very well. Parts of the stock market are still depressed, but I’ve been through several adverse market cycles and when we have clients who start with us two or three years before a bad market cycle, then at the end of two or three years their returns are not great. They might be positive—we have clients who’ve been with us for about three years that have gotten pretty decent returns, but they’re not like long-term average returns and that’s because there’s a dip in the middle.

It’s natural to think that something’s wrong or that you should make changes to a portfolio, but again we’re investing for decades for most people, and so some number of years from now this dip for this adverse market environment will be a hazy memory, although what’s happened during this time may not be so hazy because it’s so unusual.

Working with us, we know who you are, what you’re about, what your time frames are, and that’s why and how we’re always going to invest your money: to try to get the best outcome for you. We would like to keep people from making changes that may permanently impair their wealth, which is what often happens when markets get wacky like they did back in March and April this year. So, be sure to have an investment horizon and attach your mind to investing horizons that are appropriate for your entire life.

If you are looking for some financial guidance; whether for a one time financial plan or continuing advice on your investments, we invite you to meet with a First & Main Financial planner for a free consultation. We would be more than happy to sit down with you, assess your situation and review our services to help navigate your financial future.

Oakland, CA | East Bay; Independent Financial Planners and Fiduciary Standards

Hi, my name is Erik Wolfers. I’m the Managing Member of First & Main Financial. We’ve been helping clients with personal finance since 2001.

Today I’m going to talk a little bit about perspective and expertise and the fiduciary standard in the financial services industry, or practicing as a fiduciary. We got a new client last week, a single mom who is struggling with buying a home; because of the cost of homes, and she also has other basic desires to retire on time or maybe a little bit late — sending a daughter through college.

On the phone in our initial call we discussed the concept of using an interest-only mortgage to buy a home and also potentially using a line of credit as a cash reserve—using equity in the home as an emergency reserve.

Often when people buy a house they use most of their cash and then they don’t have an emergency reserve and that feels uncomfortable for them.

So, we did quick calculations and went deep into concepts. I was happy to help her but then she decided to work with us in a more detailed basis.

It takes years to gather experience and expertise on all different facets of the personal financial services industry, and when you work as a fiduciary, as we do, our only interest is helping our clients achieve the best outcome possible—which is an idea that’s not resident for many people. In their minds, they’re worried the financial services industry is going to take advantage of them, or not be looking out for their best interest, which is often true.

We are interested in primarily helping our clients get the best results possible—and there are other people like us that operate in the same way. But, being a financial planner/financial advisor is like anything else: years of accumulated experience provides insight and perspective that you simply can’t have if you haven’t been doing the work for a long time.

I always encourage people to work with a fiduciary, work with someone that’s experienced, and I also lean toward independent companies because then there’s no conflicts of interest.

If you are looking for some financial guidance; whether for a one time financial plan or continuing advice on your investments, we invite you to meet with a First & Main Financial planner for a free consultation. We would be more than happy to sit down with you, assess your situation and review our services to help navigate your financial future.

Oakland, CA | Managed Accounts: What Level of Service Should You Receive for the…

Hi my name is Erik Wolfers. I’m the managing member of First and Main Financial. People have been trusting us with their life savings since 2001. Today I’m going to talk a little bit about money management. We’ve just gotten new clients after going through a financial planning process with them.

When we looked at their Investments they decided to also move their Investments to us for ongoing wealth management and comprehensive services.

The money had been managed by a national brand name firm in an account called a Managed Account which assumes there’s some level of expert management happening inside of the account.

They were paying 1% plus the firm was using some number of in-house, brand name products; so they’re kind of double-dipping on fees.

But in looking at their accounts it was obvious that the accounts were not managed in a customized fashion or in an expert fashion. They were managed more like by formula or what is more commonly known nowadays as robot style investing, and the clients were not getting excellent responsive service.

So, if you’re paying 1% and really more than 1% and not getting great service and the performance in your account isn’t great, it’s obviously not optimal for you, the client.

They moved to us and we’re going to provide an exceptional level of service and use money management products and techniques that have been proven to work well over time.

There are a number of firms like ours out there, that put the client first and charge fair fees. And so, I always encouraged people even if you don’t choose us, to work with somebody that’s an expert, that has experience, and that’s going to put your interest first.

If you are looking for some financial guidance; whether for a one time financial plan or continuing advice on your investments, we invite you to meet with a First & Main Financial planner for a free consultation. We would be more than happy to sit down with you, assess your situation and review our services to help navigate your financial future.

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BIO: At First & Main Financial, Alison Van Dyke helps clients with their financial lives. She has worked in Corporate Finance for Bank of America and Chase Manhattan Bank. Alison is pursuing the CFP® certification; she received her MBA at Georgetown and her B.A. in Political Science from UCLA.

235 Wildwood Avenue,
Piedmont, CA 94610, USA

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Piedmont, CA 94610, USA

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BIO: At First & Main Financial, Alison Van Dyke helps clients with their financial lives. She has worked in Corporate Finance for Bank of America and Chase Manhattan Bank. Alison is pursuing the CFP® certification; she received her MBA at Georgetown and her B.A. in Political Science from UCLA.