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4 Steps to Take Toward Your Dream Retirement

By Jeff Gilbert

As financial advisors, we are often very focused on the long-term goals and the big picture. While this is certainly a good strategy because solid financial plans take time and consistency to be successful, it’s easy for us to forget about the present. Sure, it’s great to know that you’re getting top-notch financial planning and investment management, but we are also interested in improving your day-to-day life now—not just in the distant future. There is no guarantee about what the future will hold, so it’s our mission to strike a balance between the present moment and your long-term goals.

At Balboa Wealth Partners, we take financial planning further by helping our clients create a balance between working toward the retirement of their dreams and living their retirement dreams now. Here are four tips to help you get started.

What Do You Want Your Life to Look Like? 

Financial conversations can often be left-brain dominant. But since money impacts every area of your life, it’s critical that financial discussions also include your hopes and dreams for life. That means we need to dig into the emotional side of our thinking.

One simple way we do this is by asking our clients specific questions about what their retirement goals look like, such as:

  • Tangible goals: What would you like to have? 
  • Conceptual goals: What would you like your life to be like?
  • Freedom goals: What would you like to be able to do?

Principle in Action

Many people don’t even know where to begin when faced with the above questions and will sometimes provide a surface-level answer, something like “I’d like to travel” or “I’d like to spend more time with my family.” These are great starts, but it may take some time to truly uncover what’s most important to you. That’s okay. Even if you don’t know exactly what you want, there are ways to take practical steps toward leading a happier, more fulfilled life now. 

1. Expect Less

It’s no secret that money can buy comfort, stability, and less stress. But can money buy you happiness? The answer? To an extent. Researchers have found that increased income is associated with increased levels of happiness and life satisfaction up to a point—$105,000 to be exact. (1) Beyond that threshold, happiness levels plateau and additional increases in income result in negligible changes in happiness. 

Instead of focusing on the ultimate retirement dream (e.g., a certain amount of money in the bank, or a specific car or household item), try focusing on what you do have and live in the moment as much as possible. Practicing meditation or mindfulness can have significant impacts on your overall sense of happiness and well-being, (2) and letting go of expectations of what your life should look like can be a great first step in living your retirement dream now.

2. Set Sub-Goals

If your dreams are more on the tangible side, that’s great too. To help with these goals, try setting smaller sub-goals that can be achieved more quickly than the ultimate retirement dream. For instance, if your retirement dream consists of retiring in a condo on a beach in South Florida, maybe set a sub-goal of vacationing in South Florida first. Taking that trip could inspire you even more to make your ultimate dream a reality, while also allowing you to live your dream in the moment as well. 

3. Find Purpose

Studies show that individuals who live a purpose-driven life are happier and healthier on average than those who don’t. (3,4) Not only that, they also live longer! (5) A purposeful life is commonly associated with fulfillment and motivation, and can be found in many ways. Volunteering for a local nonprofit or church, spending time with your children, or pursuing a newfound hobby are great ways to find purpose in your day-to-day life.

4. Prioritize Family & Friends

This one sounds obvious, but it’s often one of the hardest things to do. Life gets in the way and before you know it, you’ve spent a whole month getting stuff done but not really spending any true quality time with the people who matter most. Living your retirement dream now often comes in the form of just slowing down for a moment. Realizing that the laundry list of stuff to buy, deadlines to meet, and things to do is important, but so is connecting with and learning from those around you.

The great news is that you don’t have to wait until retirement to do that. You can start setting aside time every week to check in with your loved ones and find meaningful ways to connect. You might just find that in doing so, your to-do list becomes a little lighter and maybe even easier to accomplish.

Get Started Today

So, what are some of the action steps you can take to start pursuing your dreams now? You may be surprised to realize that some of your goals can be accomplished sooner rather than later. 

At Balboa Wealth Partners, we are here to celebrate your successes and cope with your challenges as you work toward living your retirement dream now. Learn more about how we can help by calling our office at 949-445-1465 or emailing me at [email protected].

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.

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(1) https://www.gobankingrates.com/money/wealth/minimum-salary-to-be-happy-state/

(2) https://www.helpguide.org/harvard/benefits-of-mindfulness.htm#

(3) https://living.medicareful.com/finding-a-purpose-makes-you-happier-healthier

(4) https://psychcentral.com/news/life-purpose-linked-to-better-brain-health

(5) https://hrs.isr.umich.edu/publications/biblio/11635

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Financial Planning for Aging Parents

By Jeff Gilbert

Taking on the role of your parents’ caretaker comes with many responsibilities for which you may not be prepared. As they approach old age, they no longer just need help reading fine print or moving heavy furniture around the house; they will need more serious assistance like managing their finances and planning their estate. While it’s no kid’s dream to one day have to care for the people who you once believed were invincible, having a plan in place can help ease the burden, especially during a stressful time of transition. Keep in mind the following legal and financial considerations when planning for your aging parents’ financial legacy. 

1. Get That Will in Place! 

How many times have you heard a story in the news about a celebrity who died without a will and left their relatives and business partners with a raucous legal battle? Case in point: The battle over Jimi Hendrix’s estate continues to this day (more than 50 years later!) all because he had no will. (1)

While you may consider your family above such squabbles, it’s better not to test that assumption. You never know how large amounts of money will affect people and their behavior. Your parents need to have a will that spells out their final wishes, including who will carry out those wishes as the executor of their estate.

This is especially important in situations with blended families. It’s all too common for someone to neglect to update their will and leave an ex-wife or ex-husband as the sole inheritor or executor of an estate. Not only do your parents need a will, but they also need to make sure it is updated to reflect their current situation and desired legacy. 

The importance of double-checking beneficiary designations goes beyond just a will. Make sure your parents have gone through all of their accounts, including life insurance policies, retirement accounts, and other savings, and verified that their listed beneficiaries are correct. 

2. Start the Long-Term Care Conversation

If your parents are over 65, there’s a 70% chance they’ll need some sort of long-term care services in their lifetime. (2) That’s a high possibility that should be taken seriously.

Your whole family needs to come together to develop a plan for caring for your parents when the time comes. Discuss topics such as: Who will provide care for them? Who will pay for the care? Does it make sense for them to purchase long-term care insurance?

All too often, the most responsible or local son or daughter ends up shouldering the entire burden. This leads to burnout and resentment toward the other siblings. Save your family the trouble and proactively come up with a plan that everyone can agree on.

3. Assign Roles and Responsibilities

Approximately one in nine people age 65 and older are living with Alzheimer’s. (3) There’s a chance that a time will come when at least one of your parents is no longer able to make decisions for himself or herself. Who is going to make decisions for them at that point, both financial and medical?

While this can be an uncomfortable conversation, don’t avoid it. This is something you need to discuss with your parents and get the proper legal documents in place before they become incapacitated. Having simple powers of attorney written up will save you the trouble of going to court to request the right to help your parents when they need it most. And if your parents are comfortable with it, it would be a good idea to have one or more of their kids added to a bill-paying account. This way, if an emergency situation arises, they can access cash reserves to pay bills and debt payments immediately instead of waiting for assets to be released or legal documents to be enacted.

4. Invest in Your Relationship

While it is important to have all of the proper legal documents in place and have a plan for how to take care of your parents when they can no longer take care of themselves, for most people, their biggest regret is simply that they didn’t make the most of their time with their parents.  

We all know that our time here on earth is limited, so we need to spend it investing in those we love. As you watch your parents age, it’s a visual reminder that your time with them is coming to an end. Consider creating a routine to make sure you spend time with them frequently while you still can. Can you make a standing date for breakfast on Fridays or a phone call on Sunday afternoons? Carving time out of your busy schedule for your parents is one of the very best ways to prepare for these final years of their lives.

5. Enlist the Help of a Professional

Attempting to manage your parents’ financial situation on your own can feel overwhelming with all the decisions to make and various family opinions to contend with. Parents may also not be receptive to these difficult conversations with their children and the role reversal they find themselves in. This is where the help of an experienced financial advisor can make a world of difference for everyone involved. Someone knowledgeable and skilled in helping families make important decisions about such things as wills, retirement, and estate planning can be a great asset in these sensitive situations.  

At Balboa Wealth Partners, we are dedicated to supporting, educating, and providing informed direction to every client. If you would like help planning for your parents’ future, contact our office by calling 949-445-1465 or emailing [email protected].

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.

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(1) https://www.guitarplayer.com/news/the-estates-of-jimi-hendrix-and-noel-redding-and-mitch-mitchell-are-suing-each-other-heres-whats-going-on#:~:text=The%20estates%20of%20all%20three,from%20streaming%20and%20digital%20media.

(2) https://acl.gov/ltc/basic-needs/how-much-care-will-you-need

(3) https://www.alz.org/alzheimers-dementia/facts-figures

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How I Invest My Own Money

By Jeff Gilbert

Clients always ask me how I manage my own money as if it’s a secret that I keep to myself. The thing about money management is that people often feel like no matter how much they learn about the latest techniques and trends, they’re never quite doing it right, that there’s always some better way to save or to invest. 

With more than 30 years of experience in the financial services industry and as a CEO of a holistic financial management firm, I’m here to tell you that the way I manage my own money is not all that different from how I manage my clients’ money. Here are the three things I focus on the most when investing my own money.

Analyze Objectives & Constraints

I always say, “If it’s good enough for my clients, then it’s good enough for me.” This is why I start my personal investment plan the same way I start my clients’, through a thorough analysis of my objectives and constraints. This includes things like:

  • Understanding and prioritizing my financial goals: Do I want to invest for long-term goals like retirement, intermediate goals like education funding for my children, or short-term goals like going on vacation or buying a new house? Sometimes I will be investing for multiple financial goals all at once, which adds a layer of complexity to the plan.
  • Analyzing risk tolerance: Risk tolerance is the degree to which I can handle risk in my investment portfolio, both financially and emotionally. Some people are risk-averse and don’t like seeing large swings in their investments even if they can technically afford to lose the money. Other people don’t mind short-term volatility if it means they have a greater potential to earn more over time. Risk tolerance is unique to each investor and there is no right or wrong choice when it comes to this. Personally, I don’t mind taking risks as long as I know I have an adequate emergency fund and all my other financial bases covered.
  • Time horizon: This category ties into which financial goals I have decided to prioritize. Goals can be short-term, intermediate-term, and long-term depending on when I will need the funds. Typically, the longer the time horizon, the more risk you can take with your investments.

Create a Plan

The next step in my personal investment process is to create a plan for both qualified and non-qualified assets based on the investment objectives and constraints outlined in the first step. I start by defining an asset allocation strategy (i.e., what percent should be stocks vs. bonds or other investments) and then I narrow down the strategy to specific investments.

Qualified Assets

Qualified assets are those that receive favorable tax treatment, typically because they are meant for retirement savings. Qualified assets include employer-sponsored retirement plans like 401(k), 403(b), or pension plans. Individual retirement accounts (IRAs) and self-employed retirement savings can also be considered qualified. 

Generally speaking, these accounts should hold investments that will take advantage of both the tax-deferred characteristics (or tax-free in some cases) and the long time horizon until retirement. Typically, these accounts will start out with an aggressive allocation toward stocks (80/20) for younger investors and gradually become more conservative (60/40) as the time frame until retirement shortens.

Several types of investments make sense for qualified accounts:

  • Stocks that you plan to hold less than a year
  • Actively managed funds that produce substantial short-term capital gains
  • Income-producing assets

These are all good choices for a tax-advantaged account since any tax consequences will be deferred until retirement.

Assets that are already tax-advantaged themselves, like municipal bonds and qualified dividend-paying stocks, are not good investments to hold in these types of accounts.

Non-Qualified Assets

Non-qualified assets are traditional brokerage accounts that allow you to invest in a wide array of investment offerings. They do not have any tax advantages and thus require the most strategy when choosing which investments to use. Any money contributed will be on an after-tax basis, and any subsequent interest or dividends earned will be taxed. You will also be taxed on capital gains if you sell an investment for a gain.

The best investments for these accounts are those that have tax advantages, like municipal bonds and qualified dividend-paying stocks. ETFs are another good choice because they have significantly less turnover due to the passive nature of the investment. They follow a “buy and hold” strategy and are therefore much more tax-efficient than traditional mutual funds.

Monitor & Adjust

No matter which investments I choose, the final step is to continually monitor the plan and adjust as issues or new information arises. I will make adjustments based on any changes in my objectives or life events that may call for a modification. 

Typically qualified assets (retirement plans) are only changed to rebalance the asset allocations back to the ratios chosen in the second step. Non-qualified assets are subject to much more change as they are at the mercy of life events and market volatility. No matter which goal and investment strategy I’ve chosen, I always track my progress and make changes as needed.

How I Can Help You

Successful money management and investing don’t have to be shrouded in mystery. At Balboa Wealth Partners, our goal is to give our clients the tools and resources they need to feel confident in their financial plans. If you’d like to learn more about our investment philosophy and how it applies to your portfolio, give me a call at 949-445-1465 or email me at [email protected].

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.

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What Is a Fee-Only Financial Advisor and Why Does it Matter?

By Jeff Gilbert

If you’re in the process of looking for a financial advisor—congratulations! You have taken the first step to reach your financial goals by partnering with a professional. Now the challenge becomes finding an advisor you can trust who has your best interests in mind. You may have heard the term “fee-only” being used to describe financial advisors’ practices. But what does “fee-only” mean, and why is it an important distinction when choosing your financial advisor?

How Advisors Get Paid

To truly understand the value of a fee-only advisor, it’s important to first understand the different ways advisors can get paid. The three most common methods include:

  • Commission-based
  • Fee-based
  • Fee-only

Commission-based advisors don’t charge fees to their clients. On the surface, this model sounds great. But these advisors have to get paid somehow, so instead, they earn commissions from financial and insurance products they sell to their customers. Even if they mean well, commission-based advisors may be more motivated to sell investment and insurance products that will earn them the most money, rather than providing advice that is solely in the best interest of the client.

Fee-based advisors may sound like they’re fee-only, but they can also make commissions from financial products and transactions. In addition to charging their clients a fee, they earn a percentage of their revenue from selling products on behalf of brokerage firms, mutual fund companies, or insurance companies, thus placing them at the same risk for conflicts of interest as commission-based advisors.

Fee-only financial advisors are paid directly by their clients—and only by their clients. They don’t receive any type of kickbacks or commissions for recommending certain securities, investments, or insurance products. Their fees are typically structured as hourly or project-based fixed fees or as a small percentage of the assets they manage, known as assets under management (AUM) fees. Because fee-only advisors only get paid by their clients, their incentives are usually better aligned with the clients they work for than commission-based or fee-based advisors.

The Pros of Working With a Fee-Only Financial Advisor 

The National Association of Personal Financial Advisors (NAPFA) believes fee-only advisors are the most transparent and unbiased advisors you can come by. If you’re in the market for a financial advisor, here are three reasons why you should choose a fee-only financial professional: 

1. Reduced Conflicts of Interest

No matter how pure an advisor’s intentions are, it can be difficult to provide unbiased recommendations when they know they’ll get a kickback or commission. But this isn’t the case for fee-only advisors. They have no incentive to push certain products because they don’t sell any products at all. They’re solely compensated by you. Fee-only advisors can still have conflicts of interest that may be tied to the value of investments that are managed, but they are required to clearly disclose those to clients.

2. Fiduciary Commitment

Fee-only advisors are fiduciaries at all times, which means they are legally and ethically obligated to act in your best interest and to disclose any potential conflicts of interest. They are loyal to you and provide objective financial advice based on your unique situation and goals. 

3. Objective Advice 

It’s easy to act on emotion when you’re dealing with your own money. For example, if there’s talk of a stock market crash, you may want to change your investing strategy. Or if a family member needs to borrow money, you may be tempted to help them out even though you know giving to them would jeopardize your financial security. You also want to live a comfortable life during retirement, but you’re not sure if you’re on track. In situations like these, it’s nice to have someone you can go to for objective advice.

We’re Here for You

At Balboa Wealth Partners, we have our clients—and our clients only—in mind. We pride ourselves on transparency and avoiding biased advice whenever possible. We give our clients our undivided loyalty and are dedicated to helping them reach their financial objectives. 

Whether you have a specific financial concern or need help developing a solid financial plan, we’re here to guide you every step of the way. Give me a call at 949-445-1465 or email me at [email protected] to set up a complimentary get-acquainted meeting so we can see if we are a good fit! 

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With nearly three decades of industry experience, he has worked as both an advisor and executive level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals and to worry less about their finances and more on their passions in life. Based in Orange County, he works with clients throughout Southern California, as well as Arizona, Oregon, and Washington. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Chalice Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Chalice. Neither firm is affiliated.

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The Cost of Putting Off Financial Planning

By Jeff Gilbert

With everything on your overflowing plate, organizing your finances probably keeps getting put on the back burner. We get it. Whether it be insurance planning, filing taxes, or putting together an estate plan, most people aren’t eager to put the nitty-gritty of financial planning at the top of their to-do list. You don’t need to enjoy it, but it still needs to be done. 

Delaying completing these tasks can be costly—in time, energy, and money. If you’ve been putting off your financial plan, consider these 5 reasons why you shouldn’t.

1. You Might Not Be Saving As Much As You Should

The first reason you shouldn’t put off financial planning is that you might not be saving as much as you should. That’s not to say that the savings you do have shouldn’t be celebrated. But no matter the amount you have, you need to be sure it will be enough. 

If you plan to retire in your mid-60s, your retirement savings may need to carry you through 30+ years. Not to mention rising inflation that will decrease the value of your savings over time and the additional expenses you will likely encounter along the way. A study by the Center for Retirement Research estimated that the medium retirement savings of Americans age 55-64 is $120,000,1 yet the average retirement cost is nearly $46,000 per year!2 At that rate, a savings of $120,000 will only last 3-4 years.

The best way to avoid running out of money in retirement is to work with a financial professional to understand what your savings can handle. Contrary to popular belief, you cannot use a multiple of your annual income to determine how much to save. This is why it’s so crucial to plan ahead. The sooner you understand your need, the more options you will have and the easier your goals will be to accomplish.

2. Healthcare Costs Are on the Rise

If you’ve ever held a hefty medical bill in your hand, you aren’t alone. Healthcare costs in America are among the highest in the world.3 And as you age, you will likely require more healthcare services. According to the Fidelity Retiree Health Care Cost Estimate, the average couple at age 65 will need about $300,000 saved to cover healthcare costs in retirement.4 Most people don’t even have that much in their retirement accounts to live on, let alone cover medical costs.

Given the events of the past two years, it’s more important than ever to start preparing for the ever-increasing cost of care. The longer you wait, the less options you’ll have. Working with an experienced professional can help you evaluate your options and build a long-term plan for healthcare. 

3. Tax Strategies Take Multiple Years to Implement

Another reason not to put off financial planning is that if you don’t start early, you’ll miss out on several tax strategies that take years to implement, including:

Tax-Advantaged Retirement Savings

If you’re in a high tax bracket, being able to save for retirement with pre-tax dollars is a great advantage because pre-tax contributions reduce your taxable income and ultimately reduce the amount of taxes you owe. This strategy could save you thousands of dollars in taxes each year. The earlier you start, the more you’ll save over the course of your career. 

Roth Conversions

Roth conversions help to increase your retirement savings and decrease your long-term tax liability by transferring funds from a pre-tax retirement vehicle (traditional IRA) to an after-tax account (Roth IRA). This allows your money to grow tax-free for as long as you’d like, and required minimum distributions (RMDs) are avoided as well. 

Withdrawal Strategies

When it comes to withdrawing from your retirement accounts, how you take your distributions can make all the difference. Each retirement asset (employer-sponsored accounts, Social Security, traditional IRAs, etc.) has different tax characteristics. Creating a withdrawal strategy can help lower your tax burden by structuring withdrawals from each income source in a tax-efficient way. 

To properly implement these strategies and more, a long-term understanding of your full financial picture is required. Putting off financial planning can leave you stuck with a huge tax bill that could have been avoided.

4. Compound Interest Requires a Head Start

Just as saving early allows you to take advantage of massive tax savings over time, there is a compound effect that occurs with the money that is actually invested as well. The money contributed to your retirement account each year will grow exponentially over time, but the key part of that equation is time. 

A single penny that doubles every day for a month may not seem like much on the surface, especially when compared to $1 million up front. But by the time the 30th day rolls around, you will have over $5 million in pennies. This same concept can be applied to your retirement account, but because retirement investments are at the mercy of the highs and lows of the stock market, it will take more than 30 days to see that kind of growth. 

If you wait to invest, you are missing out on growth year after year, and the resulting loss of earnings can be substantial. Not to mention the potential for loss when you try to invest yourself without the proper advice and guidance of a professional. We’ve found that many clients are often invested too conservatively and miss out on the opportunity for significant growth in even just a slightly riskier portfolio. 

5. Financial Planning Can Alleviate Stress

Do you feel 100% confident about the myriad of financial choices you make day in and day out? Have you encountered more complexity as your assets have grown? Partnering with a financial professional can help alleviate the stress and anxiety that comes from trying to figure out your finances. 

Think about all the time you spend worrying over finances and whether you are saving enough money. Are those thoughts preventing you from making great memories and actually living your life? For many of our clients, the answer is yes. But it doesn’t have to be that way. 

Financial planning can help alleviate the stress that comes from not knowing where you stand or how to achieve your goals. It can provide clarity by defining a path from point A to point B, and allowing you to get the most out of your life along the way.

Don’t Wait Any Longer!

It should now be apparent that there are many reasons to start the financial planning process sooner rather than later. If you have long-term financial goals, such as buying a house, planning a wedding, or saving for retirement, working with a professional is one of the best things you can do to set yourself up for success. Don’t leave your most important goals and priorities to chance. At Balboa Wealth Partners, we strive to be your guide to financial independence—your advocate to help achieve your financial goals by building a custom plan to put your money to work for you.

If you want to feel confident in your financial future, give me a call at 949-445-1465 or email me at [email protected] to set up a no-obligation consultation. And you can complete a complimentary risk assessment here. We look forward to hearing from you!

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Kingswood Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Kingswood. Neither firm is affiliated.

1https://smartasset.com/retirement/average-retirement-savings-are-you-normal
2https://www.financialsamurai.com/the-average-spending-amount-in-retirement-is-surprisingly-high/
3https://www.investopedia.com/articles/personal-finance/072116/us-healthcare-costs-compared-other-countries.asp
4https://www.fidelity.com/viewpoints/personal-finance/plan-for-rising-health-care-costs

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Top 6 Habits of Financially Successful People

By Jeff Gilbert

Defining financial success is a hard thing to do. Some people consider financial success to be a feeling of reassurance and safety, while others consider financial success to be a symbol of status and power. However you choose to define success is completely up to you, but there are certain core habits and behaviors that will get you there. In this article, we’ll explore the top 6 habits to keep in mind if you’re trying to achieve financial success.

1. Cultivate Financial Confidence

One of the best habits to build is financial confidence. Many people define financial confidence by how much money you have (i.e., having money gives you financial confidence). But it’s actually the opposite. Feeling confident in your ability to save money, build wealth, and make wise financial decisions is what brings financial confidence (and ultimately financial success), not the other way around. 

Making the conscious mindset shift from one of cynicism and doubt to one of determination and confidence can make a huge difference in your ability to achieve your goals. In fact, recent research suggests that a positive outlook on your own ability to accomplish something makes you more likely to actually accomplish it. (1)

Don’t be afraid to dream big financially. You have the power to achieve your goals by proactively planning, dreaming, and strategizing. Think of your most lofty financial goal and break it down into smaller substeps. Does it sound impossible to save $100,000 in five years? Think of saving $20,000 every year instead. It’s easy to get discouraged when it feels that substantial progress is so far away. So, try acknowledging and celebrating small milestones along the way. This can help you stay motivated to keep working toward your goals. 

2. Improve Your Financial Literacy

Another great way to achieve financial success is through improving your financial literacy. It sounds cliche, but there is a reason the saying “Knowledge is power” is so commonly quoted. As with any topic, the more you know about finance, the more likely you are to make wise financial decisions. Sure, you can hire financial professionals to advise you along the way (see point #6), but nothing beats having a sense of agency over your own finances. You can rely on professionals, but you should also rely on yourself to grow your financial understanding and improve your financial literacy.

Reading books by financially successful people, listening to podcasts, reading magazines like The Economist and Kiplinger’s, or taking a financial education course are just a few ways to take your financial future into your own hands and improve your chances of achieving financial success.

3. Avoid Everyday Debt

You’ve probably heard it said that wealthy people avoid debt like the plague. Financially successful people live by this concept, understanding that credit should be used sparingly and not as a way to live beyond your means. 

Credit can be a useful financial tool when purchasing large assets that will appreciate and bring value down the line (like a house), but it can be a slippery slope if used for everyday expenses or things you don’t need. Avoid overburdening your finances with credit card debt, and if you do use credit, make sure the balance is paid off every month. Revolving credit card debt is the quickest way to rack up interest charges and fees that can take years to pay off, which makes it exponentially harder for you to achieve true financial success. 

Try shopping without your credit cards and planning ahead for large purchases instead. Minimizing the amount you have to borrow and creating a repayment plan are two ways to avoid the trap of everyday debt.  

4. Don’t Keep Up With the Joneses

While you do want to follow the good financial habits of successful people, you don’t want to get caught up in thinking that your life needs to look exactly like theirs. This is especially true when you are working toward a certain lifestyle. You won’t be able to afford that lifestyle right away, so don’t feel pressure to keep up with the Joneses. 

In today’s social-media-driven age, it can be tempting to compare yourself to your peers, feeling pressure to surround yourself with nice furniture, designer clothes, expensive cars, grand vacations, and the latest technology. But these items will only set you back in your quest for financial success, especially if they were funded with everyday credit (see point #3). 

Financial success is often built from doing the things that other people don’t want to do: tracking expenses, minimizing your spending, saving and investing religiously, etc. These small habits, when done consistently over time, will generate compounding growth and provide the framework you need for financial success.

5. Manage Your Risk

There are many ways a financial plan can be derailed. Whether this comes in the form of investment risk (hello, market volatility!), health risk, auto, liability, or homeowner risk, properly managing these potential obstacles is one of the most important ways to protect your accumulated wealth and build financial success. You can have a sizable amount saved, but it can be wiped out in an instant if you get sick, get in an accident, or experience any number of financial curveballs life may throw. 

The good news is that though there are seemingly endless risks out there, many of them can be mitigated through proper insurance and estate planning. Get in the habit of regularly checking your insurance coverage amounts to ensure they’re adequate enough to protect what you’ve already built. Consider an estate plan to protect your wealth in the event of incapacity or death, and don’t forget that making sure you’re adequately covered now will save you time, money, and energy in the future.

6. Seek the Guidance of a Professional

Though many of these points mention the importance of building your own financial confidence and literacy, working with a financial professional is also a great way to achieve financial success. Not only are financial advisors a good resource for additional financial education, they can also help you stay on track and hold you accountable to the goals you want to achieve.

Advisors have access to industry tools, technology, and continuing education that make tracking, implementing, and projecting the overall state of your financial plan much easier and much more accurate than if you were to do it completely on your own. Consider working with an advisor you trust to maximize your potential to achieve financial success.

Take the Next Step in Your Journey to Financial Success

Are you ready to take the next step in your journey to financial success? To learn more about how Balboa Wealth Partners can help you achieve financial confidence through these habits and more, call me at 949-445-1465 or email me at [email protected] for a complimentary, no-obligation conversation.

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With nearly three decades of industry experience, he has worked as both an advisor and executive level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals and to worry less about their finances and more on their passions in life. Based in Orange County, he works with clients throughout Southern California, as well as Arizona, Oregon, and Washington. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Chalice Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Chalice. Neither firm is affiliated.

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(1) https://medium.com/swlh/3-scientific-studies-that-prove-the-power-of-positive-thinking-616477838555

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We Have 5 New Team Members Joining the Balboa Wealth Team!

By Jeff Gilbert

At Balboa Wealth, we are passionate about bringing uncompromising advice, exceptional investment expertise, and outstanding service to as many people as possible. That’s why we are excited to announce our third office location in Tucson, AZ, and growth at our Scottsdale location. We want to introduce you to our five newest team members who will be serving our Arizona clients. 

Group Picture

Meet Ryan

Ryan Robinson, financial advisor and Chartered Retirement Planning Counselor℠ at our Tucson location, spends his days applying his investment knowledge and experience to build financial strategies tailored to his clients’ unique lives and goals. He prioritizes building long-term relationships with his clients so he can offer advice and service that truly makes an impact on their lives, both now and in the future. 

Ryan has a bachelor’s degree in business finance from New Mexico Highlands University, where he attended on a baseball scholarship. Born and raised in Flagstaff, AZ, Ryan now enjoys calling Tucson home. When he’s not working, you can find Ryan taking advantage of the Southern Arizona climate by participating in friendly (but competitive) rounds of golf. You can also find Ryan and his wife, Gloria, spending time with their young sons, Cole and Jace, trying to find outlets for their considerable energy! 

Meet Duane

Duane Shumaker, a Tucson native, specializes in investment and tax planning and is passionate about coordinating his clients’ entire financial picture, making sure every aspect of their financial lives is working together to get them to their goals. Duane is a CERTIFIED FINANCIAL PLANNER™ professional and an enrolled agent with the Internal Revenue Service, for which he is authorized to represent taxpayers at all administrative levels. He is managing partner of Shumaker, Wengren, LLC, one of the leading accounting and tax preparation firms in Tucson.

Duane has a Bachelor of Business Administration from the University of Phoenix and a degree in electrical and computer engineering from the University of Arizona. He also works as an adjunct faculty instructor for the University of Phoenix for their CERTIFIED FINANCIAL PLANNER™ program. Outside of work, Duane is an avid supporter of University of Arizona athletics and enjoys scuba diving, bowling, card games, and collecting and restoring classic muscle cars.

Meet Enedina

Also a native Tucsonan, Enedina Grijalva’s role is to assist in assessing clients’ current financial situations and create plans tailored to their lifestyles and goals. After years of working in cosmetology and training under award-winning hairstylist Michelle Helmke, Enedina made a career change to pursue her dream of helping people achieve financial security. She uses her vast experience in customer service and marketing to help strengthen the relationships between Ryan, Duane, and their clients.

On a personal note, Enedina is a fanatical animal lover! When she’s not putting together budget plans for her clients, she can often be found lounging on the couch with her dog, Blu, or playing Animal Crossing. Enedina is known for her inquisitive personality. 

Meet Gregory

Gregory Hermes serves our high-net-worth clients at our Scottsdale location. With over 25 years in the industry, Gregory has a plethora of experience in many years of financial planning and investment management. He grew up around family members working in finance and financial advising is in his blood (his great-great grandfather even worked for J.P. Morgan, Sr.). 

Originally from Chicago, Gregory was responsible for launching the investment advisory division at Harris Trust in Scottsdale, which was eventually recognized as the top-producing office in the U.S. His time working at upscale banks and serving professional athletes makes him a perfect fit for our Scottsdale client base. He considers his clients like family and is passionate about helping them take their finances to the next level.

Gregory loves spending time with his son. They are very involved in sports, especially baseball, and spend every other weekend at tournaments. Gregory himself was an athlete, playing hockey in his early years and winning state championships in his senior year on the swim and track teams at New Trier High School. He’s heavily invested in his community as a founding Arizona chapter leader of DePaul Alumni Association, board member of a brain cancer charity, a St. Vincent DePaul volunteer, and a parishioner at St. Theresa in Arcadio, where his son attends school.

Meet Ian

Ian

Ian Crawford comes to us from JP Morgan Private Bank, bringing a wealth of experience in banking and finance to our Scottsdale team. He is a candidate for CFP® certification and is dedicated to growing in knowledge and skill so he can exceed client expectations. Ian has built his career on the three key pillars of trust, responsiveness, and integrity so that he can provide the highest level of comprehensive wealth management services for his clients.

Originally from Southern California, Ian made Arizona his home after graduating from the University of Arizona with a bachelor’s degree in marketing. Outside of work, Ian enjoys spending time with his wife, Leslie, and their son, Grayson. Together, they love to travel and can’t wait to explore more of the world with their son. 

Moving Forward Together

We are proud to be expanding our reach and bringing Ryan, Duane, Enedina, Ian, and Gregory onto our Balboa Wealth team. If you want to experience the difference Balboa Wealth Partners can make in your finances, give me a call at 949-445-1465 or email me at [email protected].

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Chalice Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Chalice. Neither firm is affiliated.

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What’s Going on With Inflation? 3 Reasons Why It’s Here to Stay

By Jeff Gilbert

Inflation headlines are the norm these days. It didn’t come as a surprise to many that after months of being told the current inflation crisis was transitory, Federal Reserve Chair Jerome Powell announced that we can expect high inflation to continue through 2022. (1) What may have seemed like a slight inconvenience at first is now becoming a much larger issue as prices keep soaring with no clear end in sight. 

If you want to know why inflation is up, look no further than the COVID-19 pandemic, which brought the entire global economy to a complete standstill for the only time in modern history. It’s to be expected that the rebound from such a once-in-a-lifetime event will be just as enigmatic as the event itself. 

That’s not to say that the future is bleak, but rather to temper expectations so that we can properly plan for the future and mitigate potential risk. Here are some reasons why inflation has increased in the past year and what it means for your long-term purchasing power.

What Is Inflation?

According to Investopedia, inflation is a decrease in the purchasing power of money, reflected in a general increase in the prices of goods and services in an economy. (2) It can be characterized as persistent or transitory. Transitory inflation (3) is temporary and happens when supply doesn’t meet demand. If left unhandled, it can turn into persistent inflation, (4) which results in a more permanent increase in prices due to a continuous mismatch in supply and demand. 

The Consumer Price Index (CPI) is a common measure of inflation. The most recent CPI report from December 2021 suggested that inflation has risen an astounding 7% over the past year! (5) That is significantly higher than the typical 2% rise we see in an average year.

Why Is Inflation So High?

To better understand if inflation will last, let’s take a look at the factors contributing to its rise.

Devalued Dollar

When the COVID-19 pandemic first hit and millions of Americans were furloughed or laid off, drastic economic measures were taken to keep the country afloat. The U.S. government instituted expansionary monetary and fiscal policies in order to pump money back into the economy, increasing the money supply at a rapid rate. It jumped from $15.5 trillion in February 2020 to $18.8 trillion in October 2020, an increase of over $3 trillion. (6)

Though experts agree that these drastic measures were necessary to keep the economy from collapsing, they also agree that the increase in money supply devalued the dollar, meaning it takes more dollars to buy the same item since each dollar is less valuable. 

This issue is further compounded by the current trade deficit, which is sitting at a $174.6 billion (28.6%) year-to-date increase. (7) Because the U.S. buys (imports) more than it sells (exports), a devalued dollar relative to other countries’ currencies drives the cost of imported goods up even more. It’s tempting to write these issues off as fallout from the pandemic, but the trade deficit is not a new issue. In fact, the U.S. has seen a deficit every year since 1975. (8) This indicates that the rise of inflation is not a new issue either, it’s just been sped up and exacerbated by the increase in government spending in response to the pandemic. 

Supply Chain Headaches

If there’s one thing that’s been in the news even more than inflation concerns, it’s supply chain disruptions. Since the vaccine rollouts and slow return to pre-pandemic life, companies have struggled to keep up with manufacturing and distributing goods. This is because many distribution centers cut their hours when the global economy came to a halt in anticipation of a huge drop in demand for consumer goods. The drop in demand, however, did not come. 

As people across the globe spent days, then weeks, then months in their houses, demand skyrocketed for exercise equipment, home goods, and office supplies. Factories increased their output, but the distribution chains have struggled to get everything where they need to be. 

Additionally, the increased production has also caused a shortage in raw materials, thereby exacerbating the gap between overall supply and demand for even basic items. As demand continues to outpace supply, prices are driven higher and higher. 

Labor Shortages and Increasing Wages

Continued labor shortages are another factor driving inflation. In what is being called “The Great Resignation,” millions of workers across America have quit or considered quitting their jobs as they reevaluate the role that work plays in their lives. (9) As such, many companies are finding that they have to pay higher wages in order to attract and retain employees. These increased costs often get passed through to the customer in the form of increased prices for goods and services.

The flip side of the labor shortage issue is the passage of the $15 federal minimum wage. (10) Many states are following suit with plans to increase their respective minimum wage thresholds. So even if companies weren’t paying more for labor because of the struggle to find workers, they would still be paying more due to increasing minimum wage. Again, these increased costs will be passed through to consumers, and it will be more than just a transitory change in prices since the minimum wage laws are permanent. 

How Long Will Inflation Last?

It’s tough to say exactly how long inflation will last, but based on these three variables, it could be a couple years before we return to the target rate of 2%. As our global economy shifts, trade alliances change, and we experience the ongoing effects of the COVID-19 pandemic, it seems to be an issue that will persist for the foreseeable future. 

Let Us Help You Protect Against Inflation

Even if you’re not worried about degrading purchasing power, skyrocketing inflation is still a headache. It’s another variable to account for when it comes to your long-term financial strategies.

At Balboa Wealth Partners, we have the tools and expertise to guide you through a long-term inflationary environment. We will review your investment and retirement plans for proper diversification and risk tolerance levels, ensuring you are properly protected no matter how long this increased inflation lasts. If you’d like to partner with a financial planner who understands your unique needs and inspires you to be more confident in your financial decisions, give me a call at 949-445-1465 or email me at [email protected].

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Chalice Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Chalice. Neither firm is affiliated.

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(1) https://www.foxbusiness.com/politics/powell-fed-wrong-inflation-not-transitory

(2) https://www.investopedia.com/terms/i/inflation.asp

(3) https://finance.yahoo.com/news/inflation-transitory-persistent-210149448.html

(4) https://finance.yahoo.com/news/inflation-transitory-persistent-210149448.html

(5) https://www.bls.gov/news.release/pdf/cpi.pdf

(6) https://www.statista.com/statistics/1121054/monthly-m2-money-stock-usa/

(7) https://www.census.gov/foreign-trade/Press-Release/current_press_release/ft900.pdf

(8) https://www.thoughtco.com/history-of-the-us-balance-of-trade-1147456

(9) https://www.abc.net.au/news/2021-09-24/the-great-resignation-post-pandemic-work-life-balance/100478866

(10) https://www.dol.gov/newsroom/releases/whd/whd20210721

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What Should You Do About Inflation and Stock Market Volatility?

After a three-year rally, the financial markets have been down for seven straight days, marking their worst slide since the pandemic decline in March of 2020. (1) Monday’s market dip put the S&P 500 down over 10%, which is officially called a “correction” on Wall Street. (2)

In addition to the stock market decline, inflation has been causing concerns. Because inflation is reaching 40-year highs, it is expected that the Federal Reserve will begin raising interest rates in the spring, which could potentially slow the economy. (3)

Investors are understandably nervous about their investments and their purchasing power. If you are worried about your portfolio, you’re not alone. But during stock market volatility, it’s important to keep a level head to avoid financial mistakes.

Stay Calm

At times like these, it’s important to put current conditions into perspective. This is not the first time the market has taken a tumble and it won’t be the last. Declines in the Dow Jones Industrial Average are actually fairly regular events. In fact, drops of 10% or more happen about once a year on average: (4)

Ride Out the Uncertainty Storm

It’s important to remember that markets dislike uncertainty. Currently, there is a lot of uncertainty regarding the continued coronavirus pandemic, inflation, interest rate hikes, tensions between Russia and Ukraine, and earnings reports due out for several large technology companies. 

With so much uncertainty, volatility right now is extreme. The VIX, or the market volatility index, is at the highest level in nearly a year. (5) As we get more information, it is likely that day-to-day market fluctuations will decrease. 

Play Dead

There’s an old saying that the best thing to do when you meet a bear market is the same as if you were to meet a bear in the woods: play dead. While easier said than done, successful long-term investors know that it’s important to stay calm during a market correction. We don’t know yet whether the coronavirus fears will translate into an official correction, but the risk always exists.

Market volatility has increased in recent years and the media can often make it seem like each episode is worse than the one before. In reality, volatility does not hurt investors, but selling when the market is down will lock in losses.

Remember That Your Portfolio Is Diversified

Fears about inflation, volatility, and market declines are stressful. However, it is important to keep in mind that while the stock market is down, your portfolio is made up of both stocks, bonds, and other assets that are designed to work together to decrease overall losses. It’s important to consider your specific portfolio, investment horizon, and circumstances when reflecting on economic events. If you have questions about your portfolio, get in touch with our office.

Review Your 401(k) and Other Accounts

Now is a good time to take a look at all of your investment accounts, including your 401(k) to make sure it is well diversified. If you have not rebalanced your other investment accounts in the last year, get in touch with our office and we’ll take a look and offer recommendations to minimize potential losses.

Speak With Your Advisor

Whether you’re new to investing or an experienced investor, it’s helpful to consult with an objective third party. Human nature causes us all to act out of emotion when our accounts go down. As an independent firm, we put your best interests first. We seek to serve as a support system for our clients, helping them make informed financial decisions that aren’t driven solely by emotion. 

We’re Here for Your Friends and Family

If you have friends or family who need help with their investments, we are happy to offer a complimentary portfolio review and recommendations. We can discuss what is appropriate for their immediate needs and long-term objectives. Sometimes simply speaking with a financial advisor may help investors feel more confident and less concerned with the day-to-day market activity.

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Chalice Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Chalice. Neither firm is affiliated.

_____________

(1) https://www.cnbc.com/2022/01/23/stock-market-futures-open-to-close-news.html

(2) https://www.forbes.com/advisor/investing/what-is-market-correction/

(3) https://abcnews.go.com/Business/wireStory/fed-signal-rate-hike-launches-risky-inflation-fight-82442509

(4) https://www.capitalgroup.com/individual/planning/market-fluctuations/past-market-declines.html

(5) https://seekingalpha.com/news/3790661-sp-500-etfs-fall-as-the-vix-crosses-above-32

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Jump-Start Your Financial Plan for 2022!

By Jeff Gilbert

2021 is officially behind us. If you’re like many of us who had high hopes when we rang in 2021, only to experience another intense year of the pandemic, economic shutdown and uncertainty, and slow road back to “normal,” it might be overwhelming to think about planning for a new year.  But the good news is that there are actionable steps you can implement to manage your finances effectively and truly make 2022 the fresh start you desire. Here are four ways you can get started today.

1. Set Financial Goals

The first way to jump-start your financial plan is to set financial goals. Do you have a goal for your finances or are you just crossing your fingers and hoping you have enough for the lifestyle you want? 

Specific goals with defined timelines will help to determine the best course of action, including how much risk you can and should take with your money. For instance, if you’re looking for a guaranteed source of income, then you will probably want to stick with investments that will provide long-term security. Conversely, if you are looking for substantial growth, then you might want to take on more risk and invest less conservatively. Every dollar in your portfolio should be working toward a specific goal.

Remember that the best goals will be SMART: 

  • Specific: The more you can identify exactly what you’re saving for, the easier it will be to work toward it. 
  • Measurable: As much as possible, try to identify how much your financial goal will cost. Do the research to figure out what you need to save so that you’re able to see tangible progress along the way. 
  • Attainable: Make sure your goal is realistic and achievable. This might require some self-reflection or reevaluation of your priorities.
  • Relevant: Ask yourself which goals align with your core values. Remember that your finite assets will be split amongst your seemingly infinite list of wants. The more you can scale back your list to what is truly relevant, the quicker you’ll be able to achieve each goal.
  • Timely: Identify the timeline for each goal so that you can prioritize which ones need to be addressed first and how much risk you can afford to take.

2. Strengthen Your Savings

If there’s one thing the last two years have taught us, it’s that it’s crucial to prepare for the unpredictable. Whether it be a pandemic, a lost job, or rising rates of inflation, sufficient savings can mean the difference between staying afloat during uncertain times and not having enough when you need it most. 

If you’re not saving already, take steps to start putting a portion of your income away every month. Usually 10-15% of pre-tax income is a good guideline. Ideally, it is recommended that most people should have at least 3-6 months’ worth of non-discretionary expenses saved in a highly liquid, easily accessible emergency fund before saving toward other goals. Either way, consistent savings are the cornerstone of any solid financial plan.

3. Reevaluate the Risk in Your Portfolio

As mentioned in Step 1, risk is fundamental to investing. Even “investing” by hiding cash under your mattress involves risk, since there’s always the chance of a break-in or increased inflation eating away at its value. To jump-start your financial plan in 2022, be sure to reevaluate the amount of risk you are taking in your overall portfolio. 

It’s not uncommon for a portfolio to become unbalanced as the market ebbs and flows. What may have started out as a 60/40 allocation between stocks and bonds can easily become a 70/30 or 80/20 allocation, which is a significant difference in risk level. You may also find that you are too heavily concentrated in one type of asset or in one company’s stock. If this is the case for you, rebalancing and diversification should be explored. 

Though risk is fundamental to investing, it’s also crucial that you aren’t overexposed to unnecessary risks. Take steps to evaluate your risk tolerance, based on your unique financial circumstances, stage of life, and personality, and be sure your investments align.

4. Find a Financial Partner

Regardless of where you are in the planning process or what goals you have set for your financial life, we are here to support you, guide you, and navigate any financial challenges you may face. Partnering with a financial professional is a great way to take control of your finances and get a jump-start on the future. 

At Balboa Wealth Partners, we have the tools and expertise to help you manage and coordinate your financial affairs, advocating for you as you pursue your financial goals. If you want personalized support as you navigate the challenges of life and make decisions that impact your future, give me a call at 949-445-1465 or email me at [email protected].

About Jeff

Jeff Gilbert is the founder and CEO of Balboa Wealth Partners, a holistic financial management firm dedicated to providing clients guidance today for tomorrow’s success. With over three decades of industry experience, he has worked as both an advisor and executive-level manager, partnering with and serving a diverse range of clients. Specializing in serving high- and ultra-high-net-worth families, Jeff aims to help clients achieve their short-term and long-term goals, worry less about their finances, and focus more on their life’s passions. Based in Orange County, Jeff works with clients throughout the entire country. To learn more, connect with Jeff on LinkedIn or email [email protected]. 

Advisory services provided by Balboa Wealth Partners, Inc., an Investment Advisor registered with the SEC. Advisory services are only offered to clients or prospective clients where Balboa Wealth Partners and its Investment Advisor Representatives are properly licensed or exempt from registration.

Securities offered through Chalice Capital Partners, LLC, member FINRA, SIPC.

Balboa offers advisory services independent of Chalice. Neither firm is affiliated.

 

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