Are Your Investments are Sinking or Swimming

Are Your Investments Sinking or Swimming?

How often do you make assumptions when you open your 401k statement about how well it is performing? I often find that clients will decide whether or not their account is performing well based upon whether their account is worth more or less at the end of a given quarter. This is not necessarily a good way to determine whether or not your account actually had “good” performance.

My 12-year old daughter is relatively new to the sport of competitive swimming. She started later than most other swimmers her age and has worked hard to try to close the gap. During her meets (her very long early meets) I have spent a lot of time analyzing data of her times. Most important to her is that she continues to drop time, improve her form, and have fun. But many times, she will ask me, “how are my times”. She wants to know how her times compare to other kids in her age group. Just knowing how fast she swam is meaningless if she does not know how fast all the other competitors were.

The same is true of investment performance. If your performance report says you had a net return of 6% for last quarter, some might say that it performed “well.” What if the rest of the fund’s peer group returned 11% that quarter? Then you might think 6% wasn’t actually that great. Or what if you see a return of -1%? Your first thought might be that my account is underperforming but if the peer group returned -2.3 % then your return actually faired better than its peers. Another question to ask is what percentage return has your account earned AFTER fees and expenses? Most people honestly have no idea, yet this is really the most important number when it comes to knowing how your account performed. Expenses matter, especially in the long run. It is important to know the whole picture in order to determine if your portfolio is actually working for you and not against you.

You should consider working with an advisor who screens your fund lineup every quarter to determine if your current holdings are appropriate. Screening should involve more than just short-term performance. A fund’s five-year and ten-year performance numbers are a better indicator of how it has performed rather than just looking at the last three months. Other factors that should be considered is how the fund compared with its closest index and peer group in expenses, risk taken, and style drift. Monitoring software that provides a fund fiduciary score can give a good overall snapshot of how a fund compares using all criteria, not simply performance. Our firm seeks to find investments with consistent long-term performance at extremely low costs. A great question to ask your adviser: “What screening criteria do you use in determining if my fund investments are still appropriate and the best to achieve my goals?” Just because a fund was appropriate three years ago and was the best choice then, doesn’t mean it is still the best option today. You must have an effective ongoing process to help you achieve your desired outcome.

Just like my daughter’s swim times must be viewed in light of all the other swimmers she competes against, you should also compare your investment accounts in a similar way. If you are not sure how well your current accounts are actually performing, we would be happy to sit down with you and give you a complimentary report detailing how your portfolio stacks up against its peer group. If someone asked if your portfolio was sinking or swimming, would you know how to answer? If you aren’t sure, it might be time to start asking questions


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.

 

 

What to Watch For With 401k ‘Autos’

What to Watch For With 401k ‘Autos’

Automatic enrollment/escalation has been great for participation rates, but there are potential pitfalls

They’re unquestionably effective, but can at times be “logistical nightmares” for HR reps, according to Ashley Rosser, president of Victory Fiduciary Consulting. How do advisors ensure they work?

Watch the interview below to learn more

Five Training Tips to get Financially Fit

Five Training Tips to Get Financially Fit

Ashley Rosser, Mullica Hill’s expert Financial Advisor offers Five Training Tips to get Financially Fit! 

I love fitness. I love running and have raced multiple half marathons. I have competed in many triathlons, including one half iron distance that took me over 7 hours to complete and I am currently in training to complete my second one. I absolutely love setting crazy goals, following a well laid plan, and then achieving what I once thought was impossible.

Many comparisons can be made for how individuals can achieve “financial fitness”. America, as a whole is completely out of shape financially. Consider that 78% of Americans are considered to live paycheck to paycheck.Three quarters of workers would say they are in considerable debt. Most frightening, only 12% of Americans aged 55-64 have saved enough for retirement.

Five Training Tips to get Financially Fit!

1. Set goals.

You can’t know how to get somewhere if you don’t even know where you want to go. It is ok to have different short term and long term goals. Maybe your immediate goals are to get a savings account built up, or to reduce your current high interest debt. But maybe long-term you want to make sure your retirement accounts are funded appropriately or you could want to save for a second home. Whatever your goals are, write them down and be specific.

2. Start budgeting.

No one ever wants to actually do a budget, but it is impossible to make the best use of your money if you don’t even know what you are spending each month. Be honest and realistic. If you are spending $500 a month on groceries, then don’t budget for $200. Look at your spending trends and see if any adjustments can be made. No matter how tight your budget is, there is probably at least 2% of your income that is spent that you cannot account for. Think about how that 2% could be better used.

3. Save by paying yourself first.

I just mentioned that you probably can’t account for at least two percent of your income that is spent. Make sure you are paying yourself first, just like a bill each month. $25 dollars a week means you can have $1200 saved in an emergency account in just one year. Start somewhere, and try to increase what you save each month. Chances are if you don’t see it, you won’t even miss it. While we are on the topic, make sure you are deferring into your 401k account. The sooner you start, the more advantageous it will be for you in the future. If there is a company match, make sure you max out your deferral percentage right away to get the full match. If you don’t, you are literally leaving free money on the table.

4. Reduce that debt!

Take inventory of what your debt and interest rates currently are. Try to pay off your highest interest rate balances first. Consider consolidation or transferring to a low interest rate if possible. If you do a balance transfer, make eliminating the debt a high priority. Most importantly, limit your future use of credit. It is incredibly freeing to climb out of the debt but easy to get sucked back down if you are not extremely careful with how you spend.

5. Hire a “coach”.

I hired a coach for my first half ironman because I was overwhelmed and was not sure how to achieve success. A financial advisor can help you get on the right path for financial fitness. Before you hire an advisor, ask them how they will be paid. Are they paid on commissions or a predetermined asset based fee? Do they act as a fiduciary in your best interests? Make sure you understand what value you will receive for the fees you will pay. Consider using low cost, well diversified investment strategies for long term investments.

If you are interested in getting more information on how to achieve financial fitness, feel free to make an appointment at our office. I would the truly love the opportunity to help you get into the best financial shape of your life.


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.

Is Your Advisor Concerned About Conflicts of Interest

Is Your Advisor Concerned About Conflicts of Interest?

When I worked as a nurse at a large hospital, we never got “free lunch”. Pharmaceutical companies never brought us bagels in the morning, no sandwiches and brownies for lunch, no late afternoon coffee and cookie sessions. Why were we denied such innocent “perks of the job”? My institution held their patient’s interest higher than their own and they were concerned for any direct or indirect conflicts of interest. The hospital never wanted a practitioner to be swayed in one direction based upon a personal relationship or incentive.

There are also conflicts of interest that can exist in investment management relationships. Do you want your investment advisor to give you unbiased recommendations that are in your best interests first? Of course you do, a fiduciary has the legal obligation to do so. The definition of a fiduciary means an adviser who works directly for their clients and must document placing clients’ interests ahead of their own.

If an advisor is not acting as a fiduciary, they do not have to give advice that is in your “best interests”. Rather, they follow the Suitability Standard, which requires only that broker-dealers must reasonably believe that any recommendations made are “suitable” for clients. A key distinction in terms of loyalty is important; in that brokers serve the broker-dealers they work for first.

Why non-fiduciary advisors have  conflicts of interest

Non- fiduciary advisors can receive many different forms of compensation. Some recommendations may earn them lavish trips, bonuses, expense reimbursements among many other incentives. They may have a “quota to sell” of a particular product. If it is “suitable” for you, it may be recommended even if it’s not necessarily “the best”. If they recommend moving from one fund to another, this can trigger a commission to be charged. Sometimes, the only way an adviser receives compensation is by recommending to buy or sell funds, in other words to “move money”.
So, if your advisor works for a bank or broker dealer, the types of investment options and services will depend on what the bank or brokerage firm will allow. Nearly all Broker Dealers have production requirements for the Advisory Firm that must be met. The Advisory Firm must sell a certain amount of securities to keep their job with the Broker Dealer.

Why RIAs Do Not have  conflicts of interest

An independent Registered Investment Advisor (RIA) is legally required to work for their clients first. They offer the investments and services that are in their clients’ best interests without constraints.

RIAs receive their compensation from their clients only based on a mutually agreed upon fee. Sometimes it may be an hourly rate for services. More commonly, fiduciary advisers will charge a flat quarterly fee based upon the investment account size. It does not matter what investment are recommended, the advisor’s fee remains level. They can’t accept any incentives from Mutual Funds or other investment companies/products. Their only source of income comes from the client and remains non-conflicted this way.

I agree with my former employer’s stance on conflicts of interest. No one wants to worry that a medical decision could be made without the patient’s best interest placed first. I also believe that when it comes to your investments, the standard should remain the same. My clients’ interests should always be placed ahead of my own. I would love the opportunity to talk more if you have questions about whether a fiduciary adviser could help you make decisions for your financial future.


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.

Keep your investment account healthy and free from disruptive viruses

Keep your investment account healthy and free from disruptive viruses

Currently, moms and dads are constantly worried about all those winter viruses that kids seem to bring home this time of year. The former nurse in me always seeks out ways to protect our family from illness. The simple practice of washing hands, getting your flu shot and avoiding sick contacts goes a long way! Did you know there are also simple yet effective ways to keep disruptive “viruses” out of your investment accounts? They can lurk in the shadows, creating havoc without you even seeing them.

Are you aware that using the wrong share class of funds can costs investors as much as 1% or more in overall costs? The exact same mutual fund can have 6 different share classes, all with varying fees associated with them. The least expensive share class will not pay any commissions or inflated fees to your financial advisor. They are commonly referred to as Institutional Share Classes. Higher fund expense ratios will act like a virus, quickly eating away at your portfolio performance. You should ask your advisor if you are using Institutional Share Classes and if they are unable to offer them, you should consider the merit of using an advisor who can.

Do you want to make sure that your investment advisor puts your needs ahead of their own?

Most people would say without hesitation, “yes!”  However, few know that in order to ensure this, you must hire an advisor who acknowledges themselves as a Fiduciary.  Many financial advisors act as a non-fiduciary, which means their recommendations do not have to be best for you.

In short, besides the fees you pay your advisor, they can also accept commissions or receive other financial benefits from the mutual funds or products they recommend to you.  Just as a physician has taken the Hippocratic Oath to “do no harm,” financial fiduciaries have a legal obligation to always act in your best interests first.

Imagine going to the doctor with a cold and finding out they prescribed you a very expensive unnecessary medication because he received tickets to a sporting event for doing so. Working with an advisor who is a fiduciary means they can’t make recommendations that are not in your best interests.

A Virus threatening your investments….

Are you well diversified, using the right mix of stocks, bonds and cash? If you aren’t sure, you could have a virus threatening your account’s long-term health.  It is crucial for an investor to make sure they have the proper asset allocation based upon their goals and time horizon. Being too conservative early on, or too aggressive later can cause consequences that will be difficult to overcome.

When you see your physician for your annual check up, they don’t just check your lungs or eyes. Rather, they look to see how all your systems are working together and determine if any recommendations should be made based upon your exam.  A holistic advisor will look at your overall financial health and be able to help you make decisions that will give you the best opportunities for success. No two investors are the same; the right advisor will guide you through a comprehensive screening and then help you interpret what the results mean.

Simple steps to avoiding Viruses….  

Just like a simple practice such as frequent hand washing can prevent winter sickness, so will a simple check-up of your financial strategy, help keep your investments healthy and free from costly disruptions.

If you have any questions in reference to “viruses” that can affect your financial health please don’t hesitate to contact me, of course with no obligation.

Wishing you and your family great physical and financial health.


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.

Investing in the Stock Market - Riding the Roller Coaster

Investing in the Stock Market – Riding the Roller Coaster

Investing in the stock market can be unpredictable, and even scary if you are not prepared ahead of time. If you recently looked at your most recent 401k statement, you know the stock market has been taking investors for a wild ride. On December 24th 2018 the Dow Jones dove 600 points. One week later on New Year’s Eve, the market rallied and climbed 265 points, lessening the blow from the previous week. It left some investors shaken, wondering what’s next? Some may have even opted to “get off the ride”, without really understanding the long term effects of doing so.

Investing in the stock market can be a Roller Coaster RIDE

I’m reminded of when I took my daughter on her first roller coaster. As we were waiting, I prepared her. “We will climb way up that hill. Once we get to the top, we will come down really fast. We will go up and down a few more hills, but we will be safe and you will have fun.” As we began, my daughter anxiously looked down below and said, “I don’t want to go down the hill anymore.” I held her hand saying, “we have to go down, it’s all part of the ride”. As we raced down the first hill she screamed, “I WANT TO GET OFFFFFFF!” I told her if we got off now, we would get hurt, we had to finish the ride. That afternoon reminds me of what investors should remember during periods of volatility. You can’t expect the market to be permanently rising. History has shown us that we can expect a negative performing year every five years. Yes, we are well overdue. How do you ride out the turbulence?

Riding out turbulence when Investing in the stock market

First, make sure your train is on a well laid track. Ensure you are appropriately invested in a well-diversified account. A financial advisor can help you determine what percentage of stocks, bonds and cash you should consider investing in your portfolio. Your risk tolerance and time horizon should be large consideration. A good rule of thumb is if your portfolio is appropriate today, it should still be appropriate tomorrow even if the market environment has changed. Don’t “get off the ride” prematurely. Choosing to change your positions or get out of the market during a market downturn can lock in any losses permanently. Diversification is key for most long term investors. Having exposure to different asset classes and sectors will allow you make the most of a volatile market. Keep investing, even when the market is down. Remember, when the value of mutual funds go down you are essentially buying market shares “on sale”. Who doesn’t love a good sale? Also, investors should make sure the fees they pay are reasonable. While you can’t control the market, you can certainly control costs within your investments. Overpaying for advisory services will certainly cost you a lot in the long run! Finally, remember the ups and downs and turns are all part of the ride.

There is no such thing as a flat roller coaster and the same goes for the stock market. We have to have the occasional lows if we want to enjoy the highs. As for my daughter, she too learned to embrace the ride. As our train came to an abrupt stop back at the platform she grinned ear to ear and said, “let’s do that again mom!”

– Best Regards, Ashley Rosser President 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.

Should You Consider a Roth IRA or Roth 401K

Should You Consider a Roth IRA or Roth 401K

You may have heard about a retirement account known as a Roth, but do you really understand what the potential benefits are and whether you should consider contributing to one? With all the different investment options and accounts that are available, its no wonder many people get overwhelmed. Today, we will share a quick synopsis of the Roth 401k /IRA option and why it may be beneficial to you.

Roth accounts are funded with “after tax” dollars. This means you pay taxes first, then your contributions are added to your retirement account. However, at retirement you will be able to take the full account balance TAX FREE. That’s right, no matter how much money your account has earned you can take the full amount without paying additional taxes.

Let’s consider an example. Emily contributes $200/month to a Roth 401k over 40 years. She did not receive any tax deferral benefits up front, rather she paid taxes on the money first. If her investments had average returns of 6%, at the age of 65 Emily would be able to take over $400,000 tax free. She paid taxes only on the $96,000. The rules for taking the tax free benefits are fairly simple. The Roth must be in existence for at least 5 years and an individual must be at least 59 ½ before starting withdrawals.

Determining whether a Roth fits into your financial plan may depend on how long you have until retirement. Typically, the longer the money will have to compound over time, the more attractive the Roth may be. Also, if you are still in a low earning tax bracket an individual may choose to utilize the Roth (as opposed to someone in a high tax bracket in high earning years). Each situation is different and so you should talk directly with your financial advisor to see if adding a Roth makes sense.

– Best Regards, Ashley Rosser President 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.

Lottery

Are the odds in your favor?

In case you have not heard, there is a mega millions drawing happening tonight. Actually, it’s a $2.6 billion dollar drawing. It has created a lot of excitement for many. Everywhere you go, you can hear people talking about what they would do if they won, where they would go, and what they would buy. Many have expressed quitting their jobs right away, buying a new house (or island), or helping family members. It seems people are inspired to dream when they have a chance of “winning big”. I have to admit, it is fun to get lost in the “what would I do with a billion dollars” fantasy. Unfortunately, the odds are certainly not in our favor of winning the lottery. I read somewhere that you have a better chance of “being drafted by the NBA or being killed by a vending machine” then winning the lottery. Yikes! But still, Americans across the country are excitedly buying their tickets in anticipation that this could be the life change they have been waiting for.

What if I told you that you don’t actually need luck to become a millionaire by the time you are 65. All it really takes is some forethought, discipline, and time. In fact, if you are still in your 30s, all it takes is saving $7,000 a year through a retirement account. That works out to about $580 per month before taxes. Which really means you will probably only miss about $460 from your actually net pay check. Friends, that is only about $220 per biweekly pay. Can you find a way to defer that into a 401k or IRA for the future payout of $1,000,000? Can you start with something smaller and build to achieve the ultimate goal? Someone in America might become a billionaire tonight, but it is possible for many more to become millionaires by the time they retire. It all starts with making the choice to save now for the future.

We love helping our clients hit the “retirement jackpot” … no lottery ticket necessary!

Victory Fiduciary Consulting’s Coats for Kids Campaign

Victory Fiduciary Consulting’s Coats for Kids Campaign

Our coats for Kids campaign was born from the experiences of our President, Ashley Rosser. Prior to her career at Victory, Ashley was a pediatric nurse for a hospital located in West Philadelphia for over ten years. She was often reminded of the daily struggles of so many children living in the nearby communities. Throughout the long winter months, while driving to work she would see small children walking to school in the bitter cold without jackets, hats, or gloves. This has forever stayed in her mind and she always hoped to one day help make a difference in the lives of children who are not able to have the basic necessities. This was the catalyst for Victory Fiduciary Consulting’s first “Coats for Kids” campaign last year.

Over two months’ time, Victory collected 75 new and like new coats for kids and adults. By working with local schools, Victory was able to provide over 30 coats to children in need who live right in our communities. An additional 40 adult and children’s coats were donated to a mission in Camden who directly handed them out to those in need.

2018 Coats for Kids Campaign

We are hoping to make a difference again this year by collecting new and like new coats for kids and adults. We will be working with our local schools to distribute specific coats to students who have been identified to be in need. This year, we will also be taking donations of hats, mittens and scarves to go with the coats. You may drop off any donations to our office at 53 N. Main Street Mullica Hill NJ. We will also have a box on our porch for after-hours drop offs. We will be kicking off the “Coats for Kids” campaign at our annual Client Appreciation Day Open House on October, 25th from 3pm-7pm. Thank you so much for helping us make a difference in our community.

Making the Case for Life Insurance

Making the Case for Life Insurance

Let’s look at making the case for life insurance. Life insurance isn’t about YOU. It is about your loved ones. When a spouse/partner dies unexpectedly, many times their loss is catastrophic to their family’s financial stability. Many households are two income families; the sudden loss of one’s income can be insurmountable for their family to overcome. No one ever wants to talk about the need for life insurance. It is an uncomfortable subject and most people view it as “the only purchase I hope I never need”. Unfortunately, the reality is by the time one realizes they or their partner should have purchased life insurance, it is often too late.

Making the Case for Life Insurance – Objections

One of the objections I hear often is “We are young and healthy, I do not see a need for it right now”. Wrong. The best time to look at purchasing insurance is when you do not have any medical issues. Once you receive a serious medical diagnosis, it can be very difficult and sometimes even impossible to secure coverage for yourself. Rates are also much more favorable for a younger, healthy person. Another response I hear often is “but I have coverage through my employer, why do I need my own policy” Unless you can guarantee that you will work for your current job until you either die or no longer need insurance, you are taking a gamble that you will have coverage when it is needed. 

Making the Case for Life Insurance – Types

There are different types of insurance that offer different benefits and purpose. Some will simply provide a death benefit for a specific dollar amount and are guaranteed for a set number of years. Their payments are typically fixed for the duration of the contract. There are other insurances that can provide coverage “for life”. The premiums may be fixed or variable, depending on the specific coverage you are looking for. Some contracts are strictly designed to provide a death benefit, while others have cash value benefits as well.

Making the Case for Life Insurance – Expertise

 It is important to sit down with an insurance professional who can help you determine how much coverage you should consider having and what type of insurance would best suit your specific needs. At Victory, we use a specialized program that helps our clients determine how much life insurance they should consider purchasing based upon their current needs and lifestyle. It is important to be well informed of your needs so you can properly protect your family for years to come.