Articles for Advisors

Are Young Women Slowing Down Female Advancement?

The woman’s liberation movement of the 1960’s and 1970’s fought inequality of pay, employment discrimination, equal employment, and tax deductions for child-care, just to name a few.  While significant changes have been made in employment since the 60’s and 70’s, many women argue that there are still significant battles to be won.  According to the U.S. Census Bureau and the Bureau of Labor Statistics report from 2019, women are paid 82 cents for every dollar that is paid to a man.  Many argue that there are reasons for this disparity, one of which is taking time off to raise children or needing a more accommodating work schedule.  How do wealthy women today feel about these issues? 

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Who is Your Trustee?

Placing assets into the legal structure of a trust is something that wealthy investors chose to do for a variety of reasons.  The ability to very specifically dictate how assets are to be distributed as well as estate and inheritance tax savings are often common reasons.  Other wealthy investors create a trust in order to avoid probate or even to account for a beneficiary with special needs.  Many other reasons for trust creation exist however there is a common element of trust development that most investors who utilize a trust encounter: who is going to be the trustee on the trust.

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Spectrem Weekly Update: Wealthy Moving Due to Taxes, Climate and Pandemic

Two years ago I moved my family from Illinois to Florida primarily because of taxes.  The economic and political climate in Illinois was dismal....along with the actual climate (the weather!). We saved enough in personal income tax and real estate taxes to fund my daughter’s college tuition payments.  That was a big deal for our finances.  Spectrem’s research now shows that we are not alone.  While the news includes snippets of the exodus from the big cities to suburbs or the south, research also now proves that climate, taxes and the pandemic restraints are also contributing to the grand relocation.  That means that financial providers and advisors need to be able to accommodate customers wherever they may be located. 

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Why Women Use Financial Advisors More Than Men

The financial services industry has long been male dominated.  In fact, in 2018 the CFP Board reported that 76.83% of Certified Financial Planner professionals were men and only 23.16% were women.  In this male dominated field, do women feel comfortable working with a financial advisor?  According to recent research from Spectrem Group 61% of women use a financial advisor, while only 56% of men use an advisor.  Seventy percent of women also use only one financial advisor, while men are slightly more likely to utilize more than one financial advisor.  Why are women more inclined to use a financial advisor?

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How Young is Too Young to Have a Financial Advisor?

Many children are given piggy banks when they are young, in an effort to help them understand the value of saving and keeping assets in a safe location.  Some kids take to the concept of saving incredibly well, amassing a large nest egg from holiday and birthday gifts over the years due to a lack of spending.  Others take a more spendthrift approach, spending the money before it has the chance to collect any dust at the bottom of that piggy bank.  What about some of the more advanced types of financial management, such as investing or planning?  At what age is it appropriate to meet a financial advisor?  The answer may surprise you.

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Are Women More Conservative Investors?

Women have often been stereotyped at worriers.  Women are assumed to be more conservative with risks and sometimes assumed to be less knowledgeable about finances and investing.  Women are the nurturers and expected to naturally look out for their family.  Not that long ago it was unheard of to have women be part of financial discussions, but now we have female financial advisors, and advisors who make certain that women are an equal part of the discussion as men.  Does that mean women are going to have the same risk tolerance?  Just like in nearly every other aspect of life, women are not just like men.

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Even Ultra-Wealthy Investors Are in Debt

The national debt has been a subject of great political discussions recently, with many politicians and Americans nervous about the over $27 trillion dollars the U.S. has in debt.  The topic remains in the media due to the talks of stimulus packages and the possible addition to our federal debt.  Debt is not a new topic in the news, and it is a tool that many individuals utilize on a smaller scale within their own financial planning.  Utilizing financial leverage in various capacities is commonplace among wealthy investors, but how common is it among the ultra-wealthy?

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Failure to Launch

A popular movie released in 2006 features a man who is in his mid-30s and is perfectly happy living with his parents.  He hasn’t taken on the typical responsibilities of adulthood and “launched” his life completely.  His parents resort to hiring a women to help him leave their home and live on his own completely.  This idea of adult children still living with their parents or at least relying upon them for financial assistance is not a new concept.  Parents and children have been struggling with just how much help is too much, and at what point do the financial responsibilities need to be on the child for many years.  Women can differ from men in significant ways regarding these topics, leading to a difference of opinion among parents as well.

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The Unknowns in Retirement Accounts

According to US Census data from 2017, 79 percent of Americans have access to a 401(k) or similar retirement account through the employer they work for.  This is typically one of the most common ways many investors receive their first introduction into investing and saving for retirement.  When an investor leaves a company and moves to a different employer, sometimes those investors elect to take their employer sponsored defined contribution plan and roll it into an IRA.  Given that these accounts are often the first glimpse into investing for many investors, what do wealthy investors know about retirement accounts and what is still unknown?

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The global pandemic has impacted every household in the country.  Some changes have been small or temporary, such as quarantining for a period of time, or doing remote learning, while others have the potential for longer term impact, such as being laid off from work or having work hours or pay reduced.  In the cases of unemployment or cut in wages, many Americans have resorted to other sources of income outside of their traditional career income or investment income.

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