1. CONSIDER CONVERTING YOUR RETIREMENT PLAN TO A ROTH: This will be a big story for all of 2010.In general we are advising our clients to do so - although each situation should be analyzed. Call Richard Weisinger CPA in our office if you need any assistance in this area. We would be pleased to input your data into our proprietary software and run simulations for you at no charge. For more information on Roth Conversions CLICK HERE
2. BUY ONE SHARE OF BERKSHIRE HATHAWAY: The incredible wisdom of Warren Buffett is profound and humbling. The Oracle of Omaha is still sprouting investment philosophy that should be followed by all - and the annual trek to his meetings mid-year are a rare treat. (Several members of TeamGerber will be there again this year.) The Annual Letters from Buffett CLICK HERE are a lesson in savvy investing and are essential reading. This investment should be held as a family legacy.
3. LONG TERM CARE INSURANCE SHOULD BE CONSIDERED: Generally we advise those over 50 to buy it - and for those much younger we suggest they purchase it for their parents. For more information CLICK HERE
4. REVIEW YOUR WILL AND ESTATE PLAN: These documents should be reviewed at least every 5 years - and more frequently when circumstances and / or the law changes. In addition to the recent changes to the estate tax rates, this economic environment presents a "perfect storm" of low interest rates and low asset valuations - an ideal time to divest yourself of wealth as appropriate. Also consider protecting your wealth from the "creditors and predators" by use of an asset protection trust. For more information on bulletproof wealth protection strategies CLICK HERE
5. KEEP BOND MATURITIES SHORT: With interest rates at historic lows, they have more chance of rising than declining. And rises in interest rates diminish the value of longer term bonds. So stay at the shorter end of maturities where possible.
6. REBALANCE YOUR PORTFOLIO: The equity markets are up nicely since their lows and you should be sure that you (and not the markets) determine the appropriate % allocation of your assets. CLICK HERE for more information on this classic wealth enhancement strategy
7. AVOID FOLLOWING THE CROWDS (THE MASSES = THEM ASSES) Ignore the advice of your golf buddies / hairdresser / the proverbial "shoe shine man". The crowds are almost always wrong. Remember Rip Van Winkle's Investment Wisdom: "Guide your ship by the stars, not the prevailing winds" CLICK HERE for more information on classic portfolio design approaches.
8. REVIEW YOUR LIFE INSURANCE: Life insurance is now considered to be an asset class worthy of serious consideration as an investment. Costs have come down for many types of life insurance. We would be pleased to show you how guaranteed liquidity can be generated using our "GEM: Guaranteed Estate Multiplier" (R) approach either as a tax advantaged retirement fund – or as traditional life insurance. Secure life insurance companies will usually return a guaranteed 5 to 12 times your investment in cash, free of income tax, capital gains tax and estate tax when structured correctly depending on age and health. (We have seen cases where even those in mediocre health and older have made smart investments in this arena.) For those who have seen their wealth devastated by poor investment choices, this is often the best way to pass on a rebuilt estate to the next generation. "If you die poor you'll need life insurance to maintain lifestyle costs – and if you die rich you'll need it to pay the death taxes" ~ Rip Van Winkle's Wisdom
9. CONSIDER CHANGING YOUR INVESTMENT ADVISOR: In our recent survey we concluded that over 50% of investors were dissatisfied with their advisors. Compare your returns with the benchmarks - and review the fees and charges to determine whether you're getting your money's worth. Most investors are far better off in index based portfolios with bonds as a rudder to provide safety. Nobel Prize winning economics tells us that asset allocation is the most significant determinant of portfolio performance - and that stock picking and market timing don't usually work. To find out "The 10 Things Your Stockbroker Doesn't Want You To Know" CLICK HERE Get a sense of why we advise staying away from the mass media and the Wall St marketing machine note that Jim Cramer is right about 45% of the time with his stock market predictions. Flipping a coin would have done better at 50%. CLICK HERE to see the analysis.
10. MEET WITH YOUR HOME AND AUTO INSURANCE BROKER: At least every few years you should review coverages to ensure that all locations that you own or rent – and all autos - are properly insured. Valuable art and jewelry should be separately scheduled and covered. Obtain appraisals where needed to support current values. Ask your broker about replacement cost insurance, consider earthquake / hurricane / flood insurance as appropriate – and take pictures of your jewelry, art, open closets and furnishings. (Those photos and videos which should be stored offsite). These will be invaluable should the need arise to prove a claim.
NOTE: NOTHING HEREIN SHALL CONSTITUTE THE GIVING OF PROFESSIONAL ADVICE. PLEASE MEET WITH YOUR ADVISORS BEFORE ACTING ON THIS INFORMATION OR ANYTHING IN OUR NEWSLETTERS, WHICH ARE GENERIC IN NATURE AND DO NOT TAKE INTO ACCOUNT YOUR INDIVIDUAL CIRCUMSTANCES.
