Celebrate Financial Freedom on July 4th
Will you be celebrating your financial freedom next week? It’s hard to believe that Fourth of July is right around the corner. In just a few days, all across America families will get together and celebrate with barbeques, pool parties, and fireworks. We remember the day we became an independent nation and reflect on how fortunate we are to live in freedom.
As a financial advisor, we seek to help provide our clients a different type of freedom: financial freedom. For us, financial freedom means your money is able to provide the lifestyle you desire for the length of time you need it to. In other words, making sure you enjoy life while never outliving your money. Sounds like a simple concept but it requires careful planning and commitment working with an advisor who understands your goals and shares your vision.
Consider hiring a fiduciary advisor to help you achieve your financial independence. A fiduciary is bound legally to put their client’s need ahead of their own. In contrast, traditional advisors must only make “suitable recommendations”. Just like sunscreen offers you an additional layer of protections from sunburn, hiring an advisor who is held to the fiduciary code of ethics can offer additional protection to your assets because legally they must work for their clients first.
You should understand what your advisor’s investment process is. How do they determine what asset classes you should have exposure to? How do they decide which fund/ETF should be purchased? Do they typically buy and hold or use a “tactical” approach? What is their Buy and Sell Discipline? Do they rebalance, meaning do they take money from the winners and give it to the losers? What happens if the losers continue to lose? We find that most Advisors performance cannot beat their index. Furthermore, the average fund or ETF generally does not outperform their index over time.
Ask your advisor if they utilize a client investment policy statement. An investment policy statement is a crucial document that formalizes an advisor’s process regarding investment lineup selection, monitoring, and replacement. Did you know that growth stocks significantly outperformed value stocks over the past year? Having exposure to international stocks last year would have had a negative impact on your portfolio.
We employ a math-based investment strategy that allows us to focus on asset classes and sectors that are over performing and steers us away from those that are underperforming. This strategy allows us the opportunity to take what the markets will give us which allows us to grow and potentially preserve our client’s accounts over time. Our tactical model was up 5% in 2018 and has averaged over 17% over the past 5 years. Past performance is certainly no guarantee of future performance and this particular model may not be suitable for all investors, but at the end of the day, performance determines how your account will grow.
Achieving financial freedom will require careful planning. Did you know retirement planning should begin as early as possible? The earlier you begin to plan, the better chances you will have at achieving your goals and making sure your money works for you and not against you. The decisions you make in your 20s and 30s will significantly impact your lifestyle in your 70s and 80s. Hire an advisor who can guide you through all phases of the planning process. We use sophisticated web based planning software that allows us to show you how seemingly small changes can make a big difference in achieving your specific goals.
As you prepare to celebrate our country’s independence, take a moment to determine if you are actively preparing to achieve personal financial freedom. If you are unsure, we would love to sit down with you to map out a plan. Happy Fourth of July from our office at Victory Fiduciary Consulting.
Ashley Rosser, President
Prior to her career in the financial services industry, Ashley earned her Bachelor of Science in Nursing from Cedarville University.
Ashley decided to make a career change from her ten years within the healthcare industry as a pediatric emergency room nurse to retirement and 401K investment planning. She joined Victory Fiduciary Consulting in 2008 after obtaining her Series 65 professional financial license and went on to earn her AIF (Accredited Investment Fiduciary) professional designation from the Center for Fiduciary Studies.