Home » Financial Planning Advice for Advisors

Category Archives: Financial Planning Advice for Advisors

Thomas Piketty: New thoughts on capital in the twenty-first century

Thomas Piketty: New thoughts on capital in the twenty-first century

 

French economist Thomas Piketty caused a sensation in early 2014 with his book on a simple, brutal formula explaining economic inequality: r is greater than g (meaning that return on capital is generally higher than economic growth). Here, he talks through the massive data set that led him to conclude: Economic inequality is not new, but it is getting worse, with radical possible impacts.

Plan, Diversify, and Differentiate: Three Strategies of High‐Performing Advisors

Plan, Diversify, and Differentiate: Three Strategies of High‐Performing Advisors

 

A video that discusses three strategies of high‐performing advisors that helped them earn twice as much as other advisors 

Tycoon Playbook Review

Tycoon Playbook Review

enzo-bio-picture3

 

As a recent IRS report on America’s wealthiest proves, the surest way to becoming rich has always been and still is by building your own business. There are two basic approaches to building a business. One way is to focus on finding the home run product or service to build a single company around. The other way is to focus on accumulating many businesses over time. The first variation requires far more luck considering just how many failures there are relative to successes. The second variation is a simple numbers game based on the reality that once you have a system and team in place for acquisitions, you will have far more winners than losers over the long run.

 

This second path is often referred to as the PacMan strategy because you use your company to gobble up other companies. It’s the most proven path to billionaire status.

 

As with most things in life, the basic concept is simple while the devil is in the details. This is where the Playbook truly shines. The three month course reverse engineers the acquisitions strategy employed by tycoons and billionaires who made their fortunes through wheeling and dealing in businesses. Then it breaks down this complex topic into easy to understand and follow action steps. Equally importantly, it also shows you how to avoid the minefields. This is not a course built on dry academic theory.

 

The creator of the course worked for many years helping entrepreneurs and mini-tycoons to buy and sell businesses. In addition, he has also spent decades studying how they got started in the game and built their empires. As a result, the Playbook is rich in examples of actionable steps taken by tycoons to not only get going but to get it right.

 

What are the key rewards of the course in my opinion?

 

First, if you’re thinking that becoming wealthy requires an element of good luck in addition to work and perseverance, you are absolutely correct. The course reveals how you can maximize your luck if we agree that luck is a matter of being in the right place at the right time. It does so by having the second learning module reveal how insiders spot emerging opportunities well before the masses do. The eighth module teaches you how to take a calculated risk by revealing the do-able deal test for acquisition opportunities. Once you have digested these two lessons your ability to do successful acquisitions increases dramatically.

 

A second reward of the Playbook is in how it takes a complex subject such as acquisition finance, which intimidates most people, breaks it down into its constituent parts, and lists the many options you have available for buying a business. You need not be a mathematical genius to understand how tycoons acquire control of businesses. By the end of the financing section you will feel like an up and coming Kirk Kerkorian.

 

A third reward in taking the course comes from discovering the Golden Feedback Loop used by tycoons to disrupt and dominate industries. The GFL may not be available in every situation but the Playbook shows you how to recognize pre-existing ones and even trigger your own whenever possible.

 

Finally, the biggest and most important pay off comes from the details in how tycoons started down the road towards fare and fortune. The difference between them and people who don’t accomplish much is that they simply started and kept moving towards their goal. Most people never even leave the starting blocks.

 

The Tycoon Playbook contains the details of a billion dollar strategy. If you take the course and only apply 1% you will still be further ahead than most.

 

Any small business owner can begin to put these lessons into action immediately. 

 

Get your Tycoon Playbook Today!!!!!!!!!

Why Do Family Business Owners Often Die at their Desk? by Tom Deans, Ph.D.

Why Do Family Business Owners Often Die at their Desk? by Tom Deans, Ph.D.

Everyday Business Tom Deans

 

I was speaking to a friend who owns a successful manufacturing business and asked him when he plans to sell his business”. His response echoed something that I’m hearing more and more from business owners in my audience. “I can’t afford to sell – if I sell and take the proceeds and invest in this market, I couldn’t replace half my current salary”.

 

Of course the danger with this logic is that if unforeseen risk visits the business and it fails, my friend will neither have his salary nor the equity that he’s accumulated in the business over the past 20 years.

 

Misaligned financial interests of family members

 

But here’s the real problem. My friend, like so many, has other shareholders, namely other family shareholders who aren’t working in the business who want the sale proceeds now! His family dinners can best be described as a food fight waiting to happen. What to do?

 

What we do know is that doing nothing is a plan. Do nothing long enough and we know that a business owner will die at his desk. But where does the stock in the company go? Will it go to his or hers estate, to minority shareholders?

 

What usually unfolds is chaos especially when family is often left out of the planning loop. Financial advisors are doing a much better job these days of getting business owners to play the “what if” game. In fact there is a brand new breed of advisor brandishing a tough to acquire professional designation known as the Certified Business Exit Consultant — CBEC. I delivered a keynote to a recent convention of CBECs in Boston and they’re a rather impressive group of professionals committed to exit planning excellence.

 

The best advisors never stop reminding clients about the risks of business ownership

 

Asset allocation has forever been the first principal of sound investing. As investors near retirement, advisors constantly rebalance portfolios away from equity to income. The business owner who allows their high salary to cloud their thinking about the dangers to their equity in their business don’t need to travel Las Vegas to gamble – they’re already there!! Extraordinary advisors will keep this risk in focus for their business owner clients and work on divestiture strategies and timelines that meet the financial needs of both business owners today, their retirement tomorrow and the needs of surviving family.

 

Savvy advisors remind business owners that the sale process seldom unfolds quickly and even after the sale of a business, the new owners may either insist or welcome the seller to continue working and drawing a salary. It took our family 5 years to find the right buyer for our business and another 4 years to receive the full sale proceeds – that’s almost a decade from start to finish. Business owners in their 50’s, 60’s and 70’s often completely underestimate just how long and emotionally draining it is to exit their business.

 

A high salary can obscure your exit

 

You can and likely will draw a salary for many more years while actively pursuing your exit strategy. So get cracking by understanding that your high salary may be clouding your exit planning judgment and carrying with it extra risk. Risk is like stress: when you think you don’t have any, you almost always have too much. And too much a good thing is almost always fatal.

 

What will you do today to put your exit plan in motion?

 

Book Tom Deans as Your Next Keynote Speaker Today!

 

Annette Heuser: The 3 agencies with the power to make or break economies

Annette Heuser: The 3 agencies with the power to make or break economies

 

The way we rate national economies is all wrong, says rating agency reformer Annette Heuser. With mysterious and obscure methods, three private US-based credit rating agencies wield immense power over national economies across the globe, and the outcomes can be catastrophic. But what if there was another way? In this bold talk, Heuser shares her vision for a nonprofit agency that would bring more equality and justice into the mix.

Why you should listen

 

Credit rating agencies, with their power to downgrade credit ratings for entire nations, have come under intense scrutiny and recent events have put their acceptance and transparency into question. What if there was an alternative, free from the limitations and weakened legitimacy that encumbers the big three agencies?

 

Annette Heuser, executive director of the Washington branch of the German Bertelsmann Foundation, has created a blueprint for a new, non-profit solution to loosen the agencies’ iron grip. The International Nonprofit Credit Rating Agency (INCRA) would conduct unsolicited foreign-risk assessments, redefining sovereign ratings as a public good, and could dramatically shift the financial futures of the world.

 

What others say

 

[INCRA] provides an international answer to the monopoly of the three big rating agencies. SGI News

 

Introducing the concept of a Collaborative Will by Tom Deans

Introducing the concept of a Collaborative Will

by Tom Deans

Last Will and Testament

At a farm convention in Chicago, I was approached by an audience member who explained that gifting a working farm to her children was preferable to selling and leaving them each $5 million. When I pressed her for more details – such as – “what do your children think of your plan?” She snapped her head back and proclaimed, “why would I tell them?”

 

I have to confess it wasn’t the first time that I had heard someone say that silence was going to be the key ingredient of their estate plan. It got me thinking how many beneficiaries – children especially — truly know the contents of their parent’s wills?

 

When I put the question to my audiences, “how many people hold a copy of their parents’ wills?” Only 10% on average acknowledge they do. The more interesting question is: “how many in the audience will play a lead or significant role in providing care for an aging parent?” The response — an average of 75% — agreed they would. I find the disparity between these two pieces of data, striking.

 

The relationship between inheriting money and the provision of health care is an issue moving into the media and cultural spotlight for two major reasons – we’re living longer (a lot longer) and the cost of health care and assisted living are rising faster than inflation and saving rates.

 

For some who live much longer than the average age of 76 for men and 81 for woman, many will turn to family for financial support and care when their savings are fully depleted – the same family from whom secrets were kept when a surplus seemed assured.

 

Why do so many people keep secrets from those who will likely be providing them with late in life care? How do secrets serve beneficiaries or add to relationships before we become old and dependant? Talk to enough estate planning professionals and they’ll tell you it almost always comes down to a lack of trust and a debilitating fear of death.

 

For those who view their money as an absolute source of power and control you can see how the aging process and the concomitant relinquishing of power and control makes dying and death such a wretched, fearful experience. Compare that to individuals who seriously prepare family, friends and charitable organizations to receive not just their wealth but their wisdom and you’ll find some extraordinary relationships built purposefully over a lifetime – even when years outstrip savings.

 

Sharing the contents of a will requires judgment – some might call it wisdom nurtured over time. A wisdom both taught and harvested through conversations with intended beneficiaries not in the last year of life, when death seems imminent, but precisely the opposite, when death is a distant abstraction.

 

A will doesn’t need to be seen as a solo “end of life document” but rather a collaborative work of art monumentally improved by living in relationship with our intended beneficiaries.

 

It is the act of collaboration, supported through frequent and deliberate conversation about the future that we leave something more valuable than just our money. This is, in part, how our fear of death recedes when we know with confidence that our beneficiaries—our emissaries — will take our ideas and perhaps our surplus assets at death and live purposeful lives themselves.

 

Have you shared the contents of your will with your intended beneficiaries – the ones likely to be providing late in life care for you?

 

ThomasDeans

To Book Tom Deans as the Keynote Speaker at your Next Event, Click Here.

My Vet sends me reminder letters … Why can’t my lawyer when it comes to my will? by Tom Deans

My Vet sends me reminder letters … Why can’t my lawyer when it comes to my Will?

Willing Wisdom

Leading up to the release of my new book Willing Wisdom, I paid extra attention to the mail I received. Delivered to my home over the course of three months, were reminder letters from a host of personal service suppliers, including my accountant to file my taxes, my window cleaner, my lawn service, my insurance provider and my veterinarian.

 

What I didn’t receive, in fact what I’ve never received over the course of my 51 years on the planet, is a letter from my lawyer reminding me to up-date my will. Curious to know if I’m special (and not in a gifted way) I recently asked my audience – about 200 business owners from across North America assembled at a convention in La Jola California – how many of them had received an annual letter from their lawyer reminding them to up-date their will? Only seven hands shot up.

 

The results confirmed my suspicion that, like me, 193 people in that room had windows and pets receiving better regularly scheduled maintenance than their estate plans. So what’s the deal?

 

More alarming is that when questioned on the subject, half of that room acknowledged they didn’t have a will at all. When pressed further, 50% of those who did have a will confessed that it had been more than 5 years since it was last up-dated. When questioned even further almost the entire room confessed to having clean windows, healthy pets and weed free lawns.

 

Approximately 125 million North Americans over the age of 18 have no will and will eventually die intestate. The resulting financial and relational devastation to families is incalculable.

 

When I asked my veterinarian how she could be so organized and proactive in scheduling my pet’s annual check-up she tilted her head side ways (kind of like the way my dog Goblin does when I say “treats”) she blurted out – “auto-scheduler”. She might as well have added …“duhhh.”

 

Asking her for detail on this cutting edge 25-year-old technology she noted it was free — as in it doesn’t cost anything.

 

Below is the letter I received from my veterinarian word for word.


————
To: Tom Deans

Annual physical examinations and a personal health consultation is integral to maintaining Goblin’s health. Please call our office to schedule an appointment. We’ve missed you and look forward to seeing you soon!

Dufferin Veterinary Hospital
————

 

If you’re not receiving a letter from your lawyer reminding you to up-date your will, would you consider forwarding this article to your lawyer and help them get acquainted with the power of “auto-scheduling” and helping clients keep their estate plans up-to-date? Here’s a sample letter for them to consider sending annually to clients like you.


————
Dear client:

A will is one of the most important legal documents for you and your family to consider. If one or more of the following apply to you, please call our office and schedule an appointment.

 

In the past year have you experienced?

 

- the birth of a child, grandchild or other close family member?
– has someone close died?
– have you acquired or sold a business?
– has your financial situation materially changed?

 

There are many other changes in your life that may affect your will that we would be pleased to discuss, including Powers of Attorney, Advanced Health Care Directives and the selection of Executor(s).

 

I look forward to meeting with you.

 

Sincerely,

 

Your Lawyer Who Totally Gets that You are Busy and Reluctant to Think, Talk and Up-Date Your Will.
————

And while you’re at it, please remind your lawyer that no less than four US Presidents died without a will — two were lawyers.

 

To Book Tom Deans, a Lugen Family Office Speaker and

The LFO 2013 Speaker of the Year Award Winner,  

 

to speak to Your Clients, Donors, or Employees at one

of your events, please click here.

 

The Canada Wealth Gap Statistics 2013

Couting-Hundred-Dollar-Bills

In Canada the top .01% of income earners have an average income of $6 million, and collectively earn 1.5% of our total income. Sounds like a lot until you look at the US, where the top .01% earn an average of $24 million each – which adds up to a 4.5% share of the total.

(from Canadian Business, Dec 9, 2013, Editor’s Letter by Duncan Hood)

 

Managing Risk – Just Remember STARR

 

managing risk

Fortunately, there are a number of techniques for handling risks. The nature of a specific risk and the circumstances (extent of exposure, available resources, and so forth) often dictate which technique, or combination of techniques, is most appropriate. Basically, there are five methods for dealing with risk. It is easy to remember these by thinking of the acronym STARR.

 

Sharing—Sometimes, when a risk cannot be avoided and retention would involve too much exposure to loss, we may choose risk sharing as a means of handling the risk. By sharing risk with someone else, an individual also shares potential losses. That is, the individual’s own loss may not be as great if it occurs, but the individual may have to pay a portion of the losses experienced by others.

 

Transfer—Risk transfer means transferring the risk of loss to another party, usually an insurance company, that is more willing or able to bear the risk. Some non-insurance transfers of risk occur, such as when one agrees to assume the risk of another under the terms of a written contract.

 

Avoidance—As the name implies, this technique deals with risk by avoiding the risk in the first place. This usually means not undertaking an activity that could involve the chance of loss. For example, by never flying, one could eliminate the risk of being in an airplane crash.

 

Reduction—Sometimes, when risks cannot be avoided, they can be reduced. Risk reduction can work in one of two ways: it can reduce the chance that a particular loss will occur, or it can reduce the amount of a potential loss if it occurs. For example, installing a smoke alarm in a home would not lesson the possibility of fire, but it would reduce the risk of the loss from the fire.

 

Retention—Retention simply means doing nothing about the risk. In other words, people assume or retain the risk and, in effect, become self-insurers. For example, the insured would pay a smaller portion of the loss than the insurer, such as paying a deductible.

 

Canadian billionaire predicts end of US Dollar as world’s reserve currency Ned Goodman lecture

Canadian billionaire predicts end of US Dollar as world’s reserve currency Ned Goodman lecture

[youtube=

 

This video may contain copyrighted material. Such material is made available for educational purposes only. This constitutes a ‘fair use’ of any such copyrighted material as provided for in Title 17 U.S.C. section 106A-117 of the U.S. Copyright Law.

 

Translate »