March Client Newsletter
Wow it is March - the last month of the first quarter and spring is coming. As I write this today, I am reminded about how much we take for granted on a day to day basis. My family and I have been without power for 5 days now and we still have no idea when it will be back on. I read one article today that said that people are upset because they have had to go more than a day without power and this has been felt most in their inability to be on their various social media accounts - Wow first world problems!
I had the opportunity to attend the Kingdom Advisors annual conference last week in Orlando. It was amazing to see some sunshine and feel 80 degree weather for a few days, but even better than that was being able to spend a few days learning from amazing people who brought their different backgrounds together to speak about Redeeming Money. The main theme was generosity and how changing our perspective from how much can we get to how much can we give can have an amazing impact on us and those around us. There is an old adage that says that “it is better to give than receive” and if this is true, are we missing out on great areas of joy in our lives if all we are doing is accumulating for the sake of accumulating without a clear path to live a generous life? If this is something that you would like to explore deeper, please let me know. I believe that with a slight shift in our planning, we can accumulate enough for ourselves and our family and still be able to live extravagantly generous lives.
March Element Focus is….Debt Rate
Overall debt levels have risen substantially over the past 30 years. Most notably, younger generations are in a fairly unprecedented economic period. Student loan and total debt-to-income ratios are very high, especially for those with more than a bachelor’s degree or those who attend private schools. It’s not uncommon to see a graduate with student loans over four times their expected annual income.
While managing debt levels has always been a component of overall financial health, it is likely to be a more frequent part of ‘the conversation’ today.
Tracking your Debt Rate allows you to continuously monitor how much of your income is going towards debt payments. It helps me assess how your debt rate changes over time to identify patterns, to make smarter decisions about financing, and to help you avoid getting into hot water where you lose optionality and risk emotional stability.
I will be conducting an assessment on your credit card debt, mortgage and home equity debt, student loans, and other loans this month. This all flows into you Dr (Debt Rate) score. Throughout the month of March I will be reaching out to you if your score is revealing an issue that needs to be addressed. Often times if your Dr appears to be either to high or to low, it comes down to an input issue that we need to correct but, if your debt rate is high due to other reasons, we will spend some time digging in deeper.
To assist in managing debt, I will also be reaching out to you in order to get you onboarded onto the Sora platform. Sora is a debt monitoring system that analyzes your debt on a monthly basis and can provide real time recommendations to help work towards debt elimination, lower interest rates, higher cash flow, etc. Sora also will track any new credit applications that are approved which helps us detect potential identity theft issues quicker and allows us to act before issues grow.
March Planning and Investment Opportunities
Investment Allocation Review - Through out the month of March, I will be reviewing each overall portfolio in order to make sure that the initial investment allocation that we have been utilizing still matches your overall growth needs and still fits within your current risk requirements. With this review, you may receive from me an email with a link to revisit some of the risk assessment tools that we have completed in the past. If you receive one of these, please take a few minutes to complete this as soon as possible because it is an integral part of the overall analysis that I will be completing. If at the end of my review, there are changes, or areas we need to revisit, I will be reaching out to you. If you have any questions around your investment allocation or would like to review your risk positioning, please use this link to schedule some time for us to have a conversation: Let’s Connect
If you have a 529 plan, March is our rebalance month. This is not something that you have to pay attention to if you do not have a 529 plan or if you are utilizing an age based investment option within your 529 plan. However, if we have worked together to build a custom portfolio utilizing the various fund options offered in your 529 plan, then we need to spend some time rebalancing the plan back to our predetermined asset allocation percentages. The past 12 months have been a wild ride and we want to make sure that as we move forward that your plan is positioned correctly to optimize returns and reduce risk according to you overall investment objectives.
Client Actions
There are no specific required steps that you need to complete this month. However, as noted above, you may be receiving a request to update some of your risk tolerance information. If you have questions about this, or would like to update your risk tolerance, please reach out.
It has been a great start to the year and I am excited about what lies ahead. There is still continued uncertainty around inflation, jobs, and the possibility of a recession. With all of this constantly swirling, please reflect on your statement of financial purpose and utilize that as an anchor to help you remain steady in the days and months to come. This will help you stay focused on the bigger picture and help remove the anxiety from the short term volatility. If you have questions, need to be reminded of your financial purpose, or just need to be reassured, feel free to reach out if you have any questions or concerns. Have a great March