If you're the type of person who wants to know even more, we suggest these good reads. The topics are crucial to the financial planning process.
Click on any article title and you will either download a PDF or be taken directly to that document.
I personally believe that asset allocation is your single-most important investment decision. Asset allocation involves dividing an investment portfolio among different asset categories, such as stocks, bonds, and cash. Your choice of asset allocation, and a plan to re-balance to your selected mix, is far more important than your choice in individual stocks or bonds. Choosing your asset mix is a personal decision based on your risk profile, and the ideal asset allocation will also depend on your age and life stage.
This chart breaks down performance of various asset classes over the last two decades. It’s sorted by different baskets of assets such as bonds, commodities, gold, stocks, real estate, and emerging markets. The importance of diversification is almost self-evident.
This chart shows the growth of all major asset classes of the past 65 years, ranging from cash to stocks.
This eye-opening chart comes from JP Morgan Asset Management. It shows the range of returns on an annualized basis for stocks, bonds, and a 50/50 stock-bond portfolio over 1-year, 5-year, 10-year, and 20-year periods. The returns data is from 1950-2013.
Financial planning is more than budgeting, saving or having the perfect investment strategy. Financial planning is a process that sets you on a course toward achievement of your personal goals, needs and priorities through the proper management of your financial affairs. This overview has been prepared by the Financial Planning Standards Council.
Financial planners project your financial future, including retirement needs and income, insurance needs, children’s education, and more. In making these projections, we are bound by method rather than results. This document explicitly maps out the assumptions used in the preparation of your financial projections. It's fairly long and technical, though. If you prefer to skip it, rest assured that we follow these guidelines or are even more conservative in our projections. We will never forecast returns that are in excess of these guidelines.
Want to improve your personal finances? Start by taking this quiz to get an idea of your risk tolerance--one of the fundamental issues to consider when planning your investment strategy.
Your budget is the most important variable in your financial plan. It’s also the only variable over which you have complete control. Without an accurate picture of your annual spending going forward, it becomes difficult to create a reliable plan for the future. This document takes you step by step through the process of creating a budget.
Before we can get started on your personal financial plan, we will need to compile a comprehensive list of all your financial assets and liabilities.
If you want to know what you actually get when you work with us, download this sample report. While the financial plan and report we prepare for you will be totally customized to your particular circumstances, this will give you some idea of the final report. You also receive your lifelong, year-by-year financial model as an Excel workbook that permits changes to alter the possible scenarios.