Last week, The National Association of Personal Financial Advisors invited me to address their national convention, which is held in Salt Lake City, UT, this year in May.

I’ll be a part of a panel discussing the future of financial therapy and headline a breakout session on why financial planners that have their own financial planner, are happier and have more profitable practices than those planners who do their own planning.

For most state governments, including South Dakota, the chickens are coming home to roost.

For decades state and local governments have spent far more than they’ve received. They’ve funded the shortfall by borrowing and pushing the repayment out into the future, hoping against hope that somehow the money to repay the debt would come from increasing tax revenues.

Unfortunately, the increases didn’t materialize. In some cases, tax revenues actually fell as taxpayers’ incomes shrank or highly taxed individuals and companies moved to states with lower tax bases. Cities and states that overspent and over-promised are now seeing lenders begin to refuse requests for new borrowing. Now, they must make the painful decision to cut spending. This by necessity must include the programs most responsible for the overspending, which are the entitlement programs like education, Medicaid, Medicare, and public pensions.

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This week I did a very quick trip to Seattle, WA, where I spoke on my client process at the annual symposium of the Puget Sound FPA.  TD Ameritrade sponsored my talk, which was a first for both of us. I appreciated their sponsorship, as I know those in attendence at my presentation did, too. It was a pleasure meeting some new friends and connecting with old, albeit, the connection time was way too short!   And, yes, true to the stereotype that Seattle residents despise, it rained the whole time I was there.

If the premise of a new book, Academically Adrift, is correct, college might be just a waste of money. 

In spite of soaring tuition costs, more and more students go to college every year. A bachelor’s degree is now required for entry into a growing number of professions. And some parents begin planning for the expense of sending their kids to college when they’re born. Almost everyone strives to go, but almost no one asks the fundamental question posed by Academically Adrift: are undergraduates really learning anything once they get there? Continue Reading »

The determining factor that may give your kids the best chance in life doesn’t depend solely on genetics, or the decisions you make as a parent, or if you have a lot of money.  It’s actually more complicated than that, according to a study done by the University of Texas and the University of Virginia.

According to the study, for poorer parents it’s the decisions the parents make in their parenting that is the biggest determiner of their children’s  mental abilities.  For more wealthier parents, it is the kid’s genetics that matter most.

Read Jonah Leher’s report in The Wall Street Journal on this interesting phenomena here.

If you’re a plumber, do you send your sister a bill for replacing her leaking shower head? If you make your living as a massage therapist, do you expect your mother to pay you for her twice-monthly massages? As a financial planner, do you charge your family members for financial advice? Continue Reading »

Ask Dick Wagner, CFP, what his best advice is that can fit in one sentence and he will tell you, “Spend less, save more, and don’t do anything stupid.”  Here’s an article written by Olivia Mellan on the best one-line financial advice from America’s top financial planners.  Click here to read the article.

The results of the study commissioned by South Dakota Senator Tim Johnson are in:  the status quo regarding government oversight of financial advisors is adequate and no change is needed.

The bottom line is this:  sales people touting their financial products can continue to look and act like they are working in the best interests of the consumer, without disclosing the fact they are not and there is no need to make financial planning a profession.

What this means is that consumers will continue to need to work very hard to determine if their financial advisor is a salesperson or their advocate and whether they are a client or a prospect.  Continue Reading »

I’ve had an interesting conversation on Twitter recently where I was “tweeting” (that’s “talking” for the over-50 crowd) about a research study that indicated when paying off debt, there is no advantage psychologically to paying off the smallest debt first.  Instead, you should apply your funds to the highest interest rate debt.

Of course, paying off the debt with the highest interest rate makes rational sense.  When just doing the math, it always is the better financial decision.  Still, the study suggests that the human brain is wired to pay off the smaller debt first. Continue Reading »

“Fee-only advisors derive no compensation from selling commission-based products; any compensation they receive comes from clients. That compensation structure helps ensure that the advisor is working strictly on the client’s behalf and isn’t inclined to favor products that may not be in the client’s best interest,” according to Esther Pak, of Morningstar, in a post on Yahoo Finance. Continue Reading »