2017 Q2 Newsletter
With the major equity indices hovering near all-time highs at the halfway point of 2017, last week’s Client Corner illustrated how every recession, correction, and bear market in your lifetime (and long before) has turned out to be nothing more than a temporary interruption of a permanent upward long-term trend. Therefore, it should come as no surprise to anyone that when (not if) the next “distraction” occurs, we will continue to rigidly adhere to our disciplined, patient, goal-oriented, lifelong investment approach. Armed with this preemptive “I told you so,” let us shift focus from our investment portfolios to our financial plans.
In keeping with our comprehensive approach to wealth management, we launched our new DEM Dashboard software system in January 2016. And after using this powerful tool for 18 months, I can say without exaggeration that investing in this technology has been one of the best decisions we have ever made.
The system provides real-time access to all your current financial data and important documents via a single, secure, encrypted portal. Having this data allows us to project your income, expenses, assets, and liabilities throughout your lifetime, ensuring we both maintain the proper long-term perspective in both good times and bad. Most important, the program’s Decision Center allows us to model “what if” scenarios and quantify their effect on your Plan’s probability of success. We have used this feature to help many of you make more informed real-world decisions involving not only your investments, but also your taxes, loans, insurance policies, retirement plans, and charitable giving. Here are just a few examples:
- After modeling a business owner’s tax situation, we worked with his CPA and a retirement plan specialist to shield over $600,000 from taxes by adding a defined benefit component to his existing retirement plan.
- We replaced a retiree’s primary mortgage with a low-interest margin loan and had him completely debt free within 14 months.
- We worked with an independent insurance agent to save one client over $6,000 per year in annual premiums by consolidating his home/auto with a single carrier, increasing his deductibles, and covering his excess liability using a low-cost umbrella policy.
- We reduced one client’s marginal tax bracket from 39.6% to 33% and eliminated substantial embedded capital gains from his portfolio by accelerating future charitable donations and transferring appreciated securities into a donor-advised fund.
Consolidating your financial data inside our DEM Dashboard allows us to collaborate with your other advisors or our extensive network of client-centered CPAs, bankers, retirement plan specialists, attorneys, and insurance agents to design wholistic financial solutions. As proud as we are of our exceptional long-term investment returns, the highest compliment we can receive is hearing that we are delivering peace of mind through our comprehensive approach to wealth management.
Senior Portfolio Manager
Disciplined Equity Management
Plan Appropriately, Invest Intelligently, Diversify Broadly, Ignore the Noise