No one likes to think about death, and yet we all have to face it sooner or later.  My clients often request a checklist when someone they know has passed away.  It can provide some structure during a time that can seem overwhelming.  This financial checklist is in no way meant to be legal recommendations. A couple of things to note:

1. Since each estate is unique, your own legal and accounting professionals should guide you through the overall process.
2.  If you are a Trustee, the estate planning documents will give you immediate access to funds possibly needed for funeral and other expenses related to the death of the individual.
3. If you are a named executor, you will have to wait for court appointment for access to funds but you should be able to retrieve the individual’s original will from his/her safe deposit box.

WITHIN THE FIRST FEW DAYS –Take your time.  Recognize that you are going through a grieving process.  Do not be rushed into any decisions.  At the immediate time of death, there is nothing that needs to happen from a legal standpoint. You can spend your time dealing with the doctors, funeral homes and immediate family members. Get yourself through this time and process. After that, your next step will be to:

1. ____Locate any health care powers of attorney, advance health care directives, funeral and burial instructions, etc. and review them for possible instructions about disposal of the body and funeral arrangements.

2.____ Locate any papers relating to prearranged funeral services or pre-purchased burial plots.

3. ____If your loved one has served in the U.S. Military, check the website www.USMilitary.about.com and search for information on Military Honors available at burial such as US Flag and Military Representative.

4.____ Check with the decedent’s banks to see if they have any safe deposit boxes.

5. ____ Locate the original copy of the will or trust, if there is one.

6.____ Locate all the legal and financial documents that pertain to the deceased person’s assets such as deeds, vehicle titles, stocks, bonds and insurance policies.

7.____ Locate and secure important personal documents such as driver’s license, social security card, passport, birth certificate, divorce decree, legal separation agreement, marriage license, military separation papers, citizenship and retirement documents.

8.____ Maintain a detailed list of all expenses relating to the final care and/or death of the decedent. You will probably be able to obtain reimbursement for these expenses from the decedent’s estate or trust, and some of these expenses will be deductible for estate tax or income tax purposes.

9.____Contact the deceased person’s financial planner, CPA and estate planning attorney. They each need to know and will each have a role in helping you. The attorney will prepare any documents necessary to confirm the authority of the successor trustee of the trust. This will give the trustee access to assets within the trust to cover costs of the funeral and/or other related expenses.

10.____Request a minimum of five (5) death certificates from the funeral home. Most life insurance policies and related assets require an original certificate with the claim form.

WITHIN THE FOLLOWING WEEK - The deceased’s financial planner will often help with the following.

1.____Contact the insurance agent or agency handling each life insurance policy and request death benefit claim forms. If the deceased had a financial planner they will often do this for you.  Note that most insurers will usually cut a check relatively quickly following the death of a loved one.

NOTE: Do not feel compelled to invest this money immediately.  Most insurance companies will let you keep the proceeds from a life insurance policy in an interest bearing cash account until you have a plan for investing it.  If you know your loved one had a life insurance policy but you cannot find it, contact the American Council of Life Insurers (www.acli.com), which offers guidance in tracing missing policies. 

2._____Notify all other insurance carriers i.e., health, long term care, umbrella, disability, accidental death, travel, vehicle, homeowners or renter’s insurance.

3.____Get a list of all the beneficiaries of the insurance policies with their age, relationship to deceased and their current address and phone number.

4.____Contact the deceased’s current and past employer to see if any retirement plans or life insurance policies are in place and request the necessary claim forms.

NOTE: Many companies make every attempt to help the families of their employees after a death.  They may cut you a check right away for wages owed, vacation pay, sick pay, and life insurance benefits.  If the death was the result of an accident on company time, there may also be accidental death and dismemberment benefits.

NOTE: Also notify Worker’s Comp, if appropriate. 

5._____Gather all of the decedent’s bills and expenses that are coming due, bank and brokerage statements, and last year’s tax return.

6._____Locate and organize notes regarding assets and liabilities, such as Promissory Notes, Loans, Business Interests, Patents, and Royalties

7. ____ Check with banks and credit card companies to see if there was additional life insurance connected with the decedent’s accounts.

8.____ Contact all of the financial institutions that hold any assets of the deceased. Tell them you need the date of death values on each asset in each account. Ask them to send you a copy of this information. Note the name of the individual assisting you.

9.____ Locate and secure any items mentioned in a governing document, will or trust or documents of title.

WHEN YOU HAVE RECEIVED THE DEATH CERTIFICATES 

1. ____ Process Life Insurance Claims

2. ____ Apply for Social Security Benefits at 1-800-772-1213 (and/or the Veteran’s office at 916-731-7300 if applicable) and inform them of the death of the individual. Otherwise you will be required to pay back any monies that are overpaid to the decedent. Many times the funeral home will have notified Social Security; confirm this with them.

3. ____ Close Credit Card Accounts and destroy Credit Cards.

4. ____ Notify banks and brokerage firms and remove the deceased’s name from any joint accounts.

5._____Meet with the deceased’s financial planner or yours, as appropriate, to develop a long-term investment plan for the estate assets, including any life insurance benefits to be received.

WITHIN THE NEXT FEW WEEKS AFTER DEATH 

_____ Gather the legal documents (deeds, promissory notes, deeds of trust, loan or real estate documents), estate planning documents (such as wills and trusts), all current and/or past due bills, statements, claims forms, etc., and set up an initial meeting with the financial planner, CPA and the estate planning attorney to identify what needs to be done and coordinate who will do it.

Some of the tasks that will need to be addressed include the following:

∞ Lodge the original will with the court in the county of his/her domicile (legal residence).

∞ See an attorney to determine whether a petition for probate of the will must be filed.

∞ Beginning to prepare for filing the estate tax return (Form 706). Some of the forms and documents you have been collecting will be needed by your CPA or attorney to document date of death calculations for that return.

∞ Your attorney or CPA can assist you with finalizing and understanding any legal documents and/or forms that you have received.

∞The financial planner and estate attorney can also assist you with funding the trusts (if applicable) and with making distributions to any beneficiaries.

∞The financial planner and CPA can help you make IRA and pension plan election decisions.

A couple of things to consider: 

1. When you are ready, taking charge of the financial affairs can be a very healing process.  It gives us focus and empowerment when we may need it the most.
2. If applicable, contact a human resources (HR) representative of the decedent’s employer for help with retirement plans.  A surviving spouse will be able to roll over money from the deceased spouse’s retirement plan into his or her own IRA.  In most cases, that will make sense, but if you are considerably younger than your spouse you may want to keep the assets in your spouse’s retirement plan.  That may allow you to tap into those assets at a younger age without penalty.
3. Make sure you have sufficient cash on hand.  One of the biggest concerns immediately following a death in the family is making sure the survivors have enough cash to meet their current expenses as well as funeral costs.  You may want to take part of your life insurance proceeds or other death benefits and increase your cash reserves.  Try to have at least six months’ worth of living expenses covered in a money market or other very accessible account.  This will help ensure that you are not too rushed into making other major financial decisions right away.
4. Consider creating a lasting memorial.  One of the most healing experiences for survivors is to find a way to honor the people they have lost.  Whether it’s through a brick paver in a memorial walkway, a scholarship in the name of your loved one at his or her alma mater, or a donation to a favorite charity, creating a tangible remembrance is an important part of paying tribute to those who have blessed our lives.
5. If you wonder if you could benefit from any type of bereavement counseling or other support, you probably could. Please feel free ask us for a list of community resources. Don’t overlook the vital role your church, synagogue or mosque may play in providing spiritual and social support for you and the family involved.
6. For many, particularly those who are not the chief financial decision maker in the household, professional financial counseling may be a comfort.  Be sure to carefully screen financial advisors before you agree to work with them.  Key resources can be the web sites for the Board of Standards for Certified Financial Planners (www.cfp.net) and the Financial Planning Association (www.fpanet.org).

Mitchell Kauffman provides wealth management services to corporate executives, business owners, professionals, independent women, and the affluent.  He is one of only five financial advisors from across the U.S. named to Research magazine’s prestigious Advisor Hall of Fame in 2010, and among a select list of 100 over the past 20 years. 

Inductees into the Advisor Hall of Fame have passed a rigorous screening, served a minimum of 15 years in the industry, acquired substantial assets under management, demonstrated superior client service, and have earned recognition from their peers and the broader community.  

Kauffman’s articles have appeared in national publications, and he is often quoted in the media.  He is an Instructor of Financial Planning and Investment Management at the University of California at Santa Barbara, Santa Barbara Community College, and Pasadena City College.  

For more information, visit www.kauffmanwealthservices.com or call (866) 467-8981.  Kauffman Wealth Services is an independent Registered Investment Advisor and serves clients from two office locations: 140 South Lake Avenue,  Pasadena, CA 91101 and 550 Periwinkle Lane, Santa Barbara, CA 93108.   Securities offered through Raymond James Financial Services, Inc., member, FINRA/SIPC.

Especially during these times of economic uncertainty, being able to predict the future with 85% accuracy is a tantilizing prospect.  Suprisingly, that is what we get in considering that of past 21 presidential years, 18 have shown positive returns for the S&P 500.

Election year statistics have been the topic of much speculation.  A leading theory suggests that administrations may use fiscal policy such as changes in taxation and government spending to tip voter sentiment in their favor.  Actually if we drill down further, it appears that the most lucrative approach suggests we buy equities on Oct. 1^st of a president’s second year, then sell out on Dec. 31^st of the fourth year, according to the study “Presidential Puzzle: Political Cycles and the Stock Market,” by Pedro Santa Clara and Rossen Valkanov of UCLA..  Amazingly, that simple timing strategy would have sidestepped most down markets for the past 60 years.

Political rethoric aside, history also shows that the S&P 500ˡ tend to perform better under Democratic administrations (11% average return) than Republican (2% average return).  A significant exception to these trends, of course, was the 2008 financial crisis where instead of strong market performance we saw one of the worst downturns in almost a century.

As we look out over the 2012 horizon, there are a slew of worrisome challenges:

1. Structural Deficits, which can only be addressed by decisive government action;
2. Economic Uncertainty, which has prompted many investors and businesses to postpone decisions and horde cash.
3. Taxes as the Bush tax cut extensions are slated to expire at year end.
4. Middle East Turmoil, which continues to feed rising oil prices.

With these in mind, what strategies have we recommended to our clients?  Here are our top five to consider:

1. Taxable Fixed Income: With U.S. interest rates near historic lows, corporate and government bonds could be in for a tough time.  Some analysts are even describing how the 30+ year bull market for bonds which began under the Volker Federal Reserve is likely at an end.  Certainly as market rates rise, bond values decline.  So we are well advised even with laddered portfolios to stay under five year maturities and minimize exposure to bond funds.
2. Municipal Tax-Free Income: While rising rates would typically have a determintal effect on muni’s, a wild card could see increased demand should it be clear that income taxes are going to rise.
3. Dividend Stocks: As yields on many equities exceed 4%, income hungry investors have been flocking to this sector.  Cash flush corporations are increasing dividends to their shareholders plus initiating stock buy-back programs, both of which could support appreciation in this sector.  Also with so much global uncertainty, the US may be deemed the safest haven around.
4. Commodities: There is much speculation that inflation may be already here and perhaps not being accurately tracked by the government’s Consumer Price Index.  Besides gold which has enjoyed a tremendous run up over the past few years, a diversified basket of commodities may offer opportunities to preserve purchasing power.
5. Real Estate: Historically one of the best inflation hedges, commercial and residential real estate are likely near their lows in general.  Ironically, some analysts predict that rising interest rates could offer a stimulus antidote as banks would find it increasingly profitable to lend money in support of this battered sector.

Certainly as the election outcome becomes clear, many hope that governmental grid lock reduces and lawmakers recognize the importance of reaching across the aisle for meaningful bipartisan solutions.  Knowing that historical trends favor positive market performance this year can give us solace as we navigate these challenging waters.

ˡPedro Santa-Clara, and Rossen Vakanov. “The Presidential Puzzle: Political Cycles and the Stock Market. The Journal of Finance 57.5 (2003): 1841-72. Print.

The information contained in this report does not purport to be a complete description of the securities, market, or developments referred to in the material. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Any opinions are those of Mitchell Kauffman and not necessarily those of RJFS or Raymond James. Investing involves risk and investments mentioned may not be suitable for all investors. Dividends are not guaranteed and must be authorized by the company’s board of directors. Bond prices and yields are subject to change based upon market conditions and availability. If bonds are sold prior to maturity, you may receive more or less than your initial investment. Holding bonds to term allows redemption at par value. Bond prices and interest rates have an inverse relationship. Commodities are generally considered speculative because of the significant potential for investment loss. Commodities are volatile investments and should only form a small part of a diversified portfolio. There may be sharp price fluctuations even during periods when prices overall are rising. Real estate investments can be subject to different and greater risks than more diversified investments. Declines in the value of real estate, economic conditions, property taxes, tax laws and interest rates all present potential risks to real estate investments.

This information is not considered a recommendation to buy or sell any investment.

Mitchell Kauffman provides wealth management services to corporate executives, business owners, professionals, independent women, and the affluent.  He is one of only five financial advisors from across the U.S. named to Research magazine’s prestigious Advisor Hall of Fame in 2010, and among a select list of 100 over the past 20 years. 

Inductees into the Advisor Hall of Fame have passed a rigorous screening, served a minimum of 15 years in the industry, acquired substantial assets under management, demonstrate superior client service, and have earned recognition from their peers and the broader community.  

Kauffman’s articles have appeared in national publications, and he is often quoted in the media.  He is an Instructor of Financial Planning and Investment Management at the University of California at Santa Barbara, Santa Barbara Community College, and Pasadena City College.  

For more information, visit www.kauffmanwealthservices.com or call (866) 467-8981.  Kauffman Wealth Services is an independent Registered Investment Advisor and serves clients from two office locations: 140 South Lake Avenue,  Pasadena, CA 91101 and 550 Periwinkle Lane, Santa Barbara, CA 93108.   Securities offered through Raymond James Financial Services, Inc., member, FINRA/SIPC. 

These events offer clients an enjoyable social experience and a relaxed venue to introduce their friends and colleagues who could benefit from knowing more about our services.

To learn more about all upcoming events, please contact Kevin Whitten at 626.795.6874 Extension 2.

Past Events

Client Education Breakfast at CalTech
Saturday, Janurary 28, 2012

Each year clients and their guests enjoy breakfast at Cal Tech while they hear the very latest from experts on a broad range of fascinating, life-enhancing topics beyond just the economy and markets.

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Protecting your estate from creditors, predators, in-laws, and outlaws.  That is a key reason for clients with larger estates to consider establishing an Irrevocable Life Insurance Trust, or ILIT.

Acronyms can be mystifying, so let’s start with a definition.  An ILIT is a trust wherein the grantor gifts assets (and thereby gives up all incidence of ownership) so that the ILIT itself becomes the owner of the asset(s). That effectively removes the asset(s) from inclusion in the grantor’s estate.  So if all goes as it should, upon death there could be less or no estate taxes because the estate is smaller.  This makes the ILIT an essential tool for financial and estate planning.

As with many things that sound too good to be true, there are downsides. 

1. Benefits of Ownership: Top is that the grantor typically also irrevocably forfeits the incidents of ownership.   This may include control as well as economic benefits such as cash flow.  The extent to which this occurs may depend on state law and the trust language.
2. Pull Back: If an individual owner dies within three years of the transfer, the value of the asset is pulled back into the estate for tax purposes.  It is important to remember that it is the death of the owner, not the insured, that influences the clock for this three year rule.

Depending on the client’s goals, ILIT’s often have either one or both of these objectives:

1. Liquidity: If the estate size is large enough to potentially be taxable, an ILIT can provide cash at death that could be used to pay estate taxes and settlement costs.  Under this scenario, life insurance on either one or both spouse’s lives is often used as the funding vehicle.  This contrasts with life insurance that is owned by the grantor and would thus be included in his or her estate for tax purposes.   It also provides a leveraged effect in that the dollars paid for premium are typically a fraction of what the actual death benefit can be.   The goal is to make sure the estate has sufficient liquidity so there is no pressure to liquidate assets at an inopportune time just to settle the tax bill.
2. Estate Reduction: Since an ILIT can hold virtually any asset of value, another goal may simply be to transfer the asset out of the estate.   This will make the estate smaller at death and thus subject to less or no estate taxes.  The strategy can be even more effective if the asset is expected to appreciate in value, since that appreciation would hopefully be out of the grantor’s estate and therefore also not subject to estate taxes.

So if the husband owns an insurance policy on his wife, as an example, and she dies, the proceeds that would be available to the estate at that time would not be subject to estate taxes.  However, upon the husband’s subsequent death, the value would be included and possibly taxable.

Using life insurance within an ILIT can offer an alternative.  First, life insurance proceeds are received income tax-free by the policy beneficiaries.  Also, there can be creditor protection, since in many states life insurance proceeds paid to a named beneficiary are not subject to the claims of the policy owner’s creditors.  The specific rules of course can vary from state to state.

If the estate is named as beneficiary, the proceeds are still paid income tax-free.  However by doing this we have converted a non-probatable asset into one that is subjected to the probate process.  This can create several disadvantages, including:

1. Expenses are greater due to attorney and court fees;
2. More time is needed to go through the probate process as opposed to just a beneficiary payment;
3. Estate creditors could have access to the insurance proceeds depending, again, on prevailing state laws.  Hence a reason we would not usually recommend the estate as beneficiary of an insurance policy.  This also speaks to the prudence of always naming a contingent or secondary beneficiary;

In short, an ILIT is really a financial bucket designed to hold assets.  If dealing with life insurance, the policy’s value is not the insurance proceeds but rather the cash value or the market value, as determined by an IRS formula.   So when dealing with existing coverage, it is a simple matter of having the owner transfer or assign the policy to an ILIT by filing a change of policy ownership and beneficiary form with the insurance company.  Once the ownership change has been recorded by the insurer, it is also important to now name the ILIT as the new owner as well as the policy beneficiary.   Since this is a gift, a gift tax return form 709 should also be filed with the IRS even if there is no tax due.

Clients often ask how gifting an insurance policy to an ILIT could affect their annual gift exclusion.  In considering this, it is important to remember that the exclusion applies to present interest gifts which can be enjoyed now.  By contrast, gifts to an ILIT are of a future interest so they do not typically qualify for the exclusion.

As an alternative, we use a technique called the “Crummey” provisions.  The Crummey provision is based on prior case law and allows an exception when the ILIT trustee sends a letter to the trust beneficiary saying they have a specific time, say 30 days, to claim their portion of the gift.  Although they may not opt to do so, that the option exists effectively creates a “present-interest” gift exclusion.

Another option is to allow for spousal access.  This means that the trustee in his or her sole discretion may distribute money to the spouse or the grantor for health, education, maintenance or support.  We usually see this in the form of separate ILIT’s for each spouse with the non-insured spouse being the beneficiary.  If done properly, the provision can allow the spouse to withdraw dividends and interest earned by the policy at, say, retirement, while keeping a majority of the death benefit available to the estate.

With any irrevocable trust, and ILIT’s are no exception, there can be an issue of retaining too much control over the transferred assets.  When this occurs, we face the danger of having the policy being pulled back into the estate for tax purposes.  That is why it is often advisable to spend the additional expense in order to involve a professional trustee.  Professional trustees, often a trust company or bank, typically bring a high competence to the table that may help assure all functions as it is intended.

This information is not considered a recommendation to buy or sell any investment.

Written by
Mitchell E. Kauffman, MBA
Certified Financial Planner^TM
Masters of Science in Financial Planning

Mitchell Kauffman provides wealth management services to corporate executives, business owners, professionals, independent women, and the affluent.  He is one of only five financial advisors from across the U.S. named to Research magazine’s prestigious Advisor Hall of Fame in 2010, and among a select list of 100 over the past 20 years. 

Inductees into the Advisor Hall of Fame have passed a rigorous screening, served a minimum of 15 years in the industry, acquired substantial assets under management, demonstrate superior client service, and have earned recognition from their peers and the broader community.  

Kauffman’s articles have appeared in national publications, and he is often quoted in the media.  He is an Instructor of Financial Planning and Investment Management at the University of California at Santa Barbara, Santa Barbara City College, and Pasadena City College.  

For more information, visit www.kauffmanwealthservices.com or call (866) 467-8981.  Kauffman Wealth Services is an independent Registered Investment Advisor and serves clients from two office locations: 140 South Lake Avenue,  Pasadena, CA 91101 and 550 Periwinkle Lane, Santa Barbara, CA 93108.   Securities offered through Raymond James Financial Services, Inc., member, FINRA/SIPC.

How can it be that with gas prices flirting with $4 per gallon and with food prices on the rise, there only is a 3.2% annual Consumer Price Index increase through April 2011?  Does there seem to be a disconnect to you?

If your answer is yes, you are not alone.  Despite repeated reassurances by Ben Bernanke, Chairman of the Federal Reserve Bank, that inflation is well in hand, a growing number of notable economists have been questioning how accurately the CPI actually tracks the true rise in the very same consumer goods and services that we use every day.

To fully appreciate the controversy, it may be valuable to step back and take this in context.  The Bureau of Labor Statistics of the U.S. Department of Labor is charged with tracking changes in the prices of 207 consumption items (e.g. raw materials, as well as goods and services) at the manufacturer, wholesale, and retail levels in 44 geographical areas.  The result is 9,108 components, which, at times, behave similarly and, at other times, differently.  The technical issues imposed are daunting to say the least.  While the methodology used for this tracking can be critical, it is inevitably the local retail price level that most impacts consumers at the grocery store, gas pump, restaurant, etc.  (Consumer Price Index and Public Policy)

The official monthly “All Urban” CPI for the past year is depicted in the following chart . You may recall just a year ago and coming off the 08-09 financial crisis, the big concern was actually “deflation.”  That occurs when prices decline and is perhaps the scariest of all scenarios. Deflation was a dominant factor in extending the Great Depression of the 1930’s.  When consumers believe that prices are falling, they are less likely to spend money and do the activities they normally do.  The economic results can be disastrous.

So Bernanke, as a devoted student of the Great Depression, has been working in earnest with his Federal Reserve colleagues to actually create modest inflation.  And he has been claiming reasonable success in those efforts, which seems to be supported by, among other things, the chart below.

That said, there is a growing number of leading economists and academics who have been questioning the ability of the government’s CPI to accurately track the true costs of goods and services on which we spend money on every day to live, work, and entertain ourselves.   One noted economist, John Williams, has gone so far as to routinely refer to the CPI as a “bogus index.”  The Dartmouth trained economist believes that the Bureau of Labor Statistics has, under the auspices of “improvement,” actually changed the calculation method “24 times since 1978” and that if the same methodology were being used today, the true CPI figures would be more like 10%!.

One methodology change in particular, called “the substitution effect” (as recommended by the Boskin commission report under the Bush 1 and Clinton administrations, in the 1990’s), is often cited as an overt example of CPI understatement.  Underlying this process is the presumption that when prices for goods and services rise, consumers will tend to “substitute like products to avoid the price increases.”  An example is when the price of steak rises, it is assumed that even the most devoted consumer will choose to buy hamburger instead.  Whether that behavioral change actually occurs and to what extent is the subject of great controversy.  Critics claim that this one change in and of itself could be understating the true inflationary pattern by 1-2 percent annually.  The argument continues that when you filter in all the other methodology changes, some minor and others major, the end result is a dramatically understated CPI.

What possible incentive would there be to understate such a critical economic indicator?  Because the CPI is the key inflation index used to adjust social security, military retirement, and numerous other entitlement programs.  It is also the basis for our income tax system, including tax brackets, personal exemptions,  and the standard deduction.  Bottom line, the Boskin Commission estimated that over $600 billion would be saved if the CPI increases could be reduced by 1.1% annually for the ten year period 1997-2006.  So supporters of this theory are confident that motivation abounds.

Conspiracy theories aside, “Product Downsizing” may be another way that inflation is subtly affecting us.  Therein, items particularly in the food category are finding their packages contain less product offered at the same price.  The NY Times recently suggested an idea called “Stealth Inflation.”  Manufacturers are seeing the costs of their commodities rise in the face of an otherwise tight fisted economy where frugal shoppers abound.  Rather than pass prices on and risk losing market share to a cheaper competitor, the slightly smaller package allows manufacturers to pass on rising prices in a discrete manner less likely to incur customer wrath.  So for example, when a two ounce candy bar suddenly appears on the shelves one day as 1.8 ounces but continues to sell for the same price, the change could be construed as an 11 percent price increase.

As John T. Gourville,Harvard Business School marketing professor, so aptly put it: “Consumers are generally more sensitive to changes in prices than to changes in quantity.” So Gourville suggests that subtle changes in package design or inclusion of more air to fill the package, can give the same shelf appearance.  But the reality is, less in hand for the same price equals higher cost.  And that spells inflation in any language.

How these practices specifically affect us may be the fuel for much economic controversy.  When translated into our future planning, at the very least it can serve to place more emphasis on the need for growth in savings among investors of all ages.

There is common agreement, especially with our increased longevity; over one in four of us may be facing 30 years or more of retirement (according to the Society of Actuaries Annuity 2000 Mortality Table).  Should inflation average 5% per year, it will take $141 in just 7 years to buy what $100 buys today.  Considering the number one fear of retirees today is running out of money, achieving financial independence in our golden years is vital.  Suffice to say, it is absolutely imperative that techniques geared toward capital and purchasing power preservation be an essential part of every retirement portfolio.

This information is not considered a recommendation to buy or sell any investment.

Written by
Mitchell E. Kauffman, MBA
Certified Financial Planner^TM
Masters of Science in Financial Planning

Mitchell Kauffman provides wealth management services to corporate executives, business owners, professionals, independent women, and the affluent.  He is one of only five financial advisors from across the U.S. named to Research magazine’s prestigious Advisor Hall of Fame in 2010, and among a select list of 100 over the past 20 years. 

Inductees into the Advisor Hall of Fame have passed a rigorous screening, served a minimum of 15 years in the industry, acquired substantial assets under management, demonstrate superior client service, and have earned recognition from their peers and the broader community.  

Kauffman’s articles have appeared in national publications, and he is often quoted in the media.  He is an Instructor of Financial Planning and Investment Management at the University of California at Santa Barbara, Santa Barbara City College, and Pasadena City College.  

For more information, visit www.kauffmanwealthservices.com or call (866) 467-8981.  Kauffman Wealth Services is an independent Registered Investment Advisor and serves clients from two office locations: 140 South Lake Avenue,  Pasadena, CA 91101 and 550 Periwinkle Lane, Santa Barbara, CA 93108.   Securities offered through Raymond James Financial Services, Inc., member, FINRA/SIPC.

When it comes to bonds, the old adage, “they ain’t what they used to be,” may hold good wisdom in this challenging economic climate.  Bonds are essentially loans that investors make to domestic and foreign corporations, U.S. and foreign governments, as well as state and local municipalities.  As such, they represent a wide spectrum of investment opportunity. Some, particularly U.S. Govt., higher rated corporate and municipal bonds, have been traditionally viewed as a “safe haven” and buffer against stock market volatility.  Others, such as high yield and international, may offer greater risk with varying degrees of upside potential.  Bonds have also been sought for their diversification and for reliable competitive interest rate returns.

However, in this environment of low interest rates, sovereign and municipal debt uncertainties, some of these long held beliefs are being called into question.  Clients, perhaps more than at any other time over my nearly 30 years of advisory experience, are raising issues that I thought would be helpful to address:

Are bonds not a safe investment that should be part of every investor’s portfolio especially as they approach retirement? Bonds are traditionally used to provide predictable income, diversification, and a buffer against portfolio volatility.  That is why so many investors flocked to bonds in the aftermath of the Financial Crisis.  In fact, “… since January 2007, average net new money going into bond mutual funds each month has been roughly four times greater than net outflows from equity funds.” ¹

However, the correlation between bonds and stocks is seen as getting closer to the point whereby they may no longer offer the kind of diversification as they once did. And, the low interest rate environment has offered disappointedly low income opportunities when compared with other options such as dividend paying stocks.

Many economists point to the increased volatility of bond markets and that bond losses can be greater and continue for longer periods than those of stocks. For example, the bond markets experienced a 67% decline (in real terms) occurred Dec. 1940 – Sept. 1981 for 20 year U.S. Treasuries. In fact, they did not return to their 1940 level until 1991. ²

Of course the definition of a “safe investment” will vary between investors.  For those who define it as stability of principal, it is important to fully understand the risks posed by bonds at a time when market rates are low and perhaps poised to rise.

Are bonds a good investment when interest rates are low?  Traditional (i.e. fixed coupon) bonds have their maturity and interest rates set at the time of issue.  As such, they can be viewed as contracts, many of which are bought and sold daily.  Because interest rates are constantly changing in the market place, the value of those fixed contracts will fluctuate as well.  For example, if a bond is issued at a 5% rate and the next year market rates rise to 6%, investors are less attracted to the 5% bond.  Consequently the price could fall.

Conversely, if rates should fall to 4% the next year, the bond becomes more attractive and the price could rise.  Because of this, the price of bonds is said to be “inversely related” to interest rates.  So when market rates have been low and begin to rise, we could expect to see bond values fall.  Investors need to be aware that buying many types of bonds in a low rate environment could cause their bond portfolio to decline in value when rates rise.

Should I buy bonds at a premium?  A low interest rate environment often makes bond prices rise on the secondary market resulting in the trading price exceeding the bond’s par value.  Problem is, when that bond eventually matures, it is the par value and not the cost that gets redeemed.  An income investor who spends the interest generated along the way could end up with less than the purchase price when the bond is redeemed.

Proponents of premium bonds may argue they can be effective when the interest is reinvested instead.  However this “Total Return” strategy can present some challenges.  First, reinvestment of interest payments can be difficult if the amounts are too small to purchase additional bonds.  If reinvestment is impeded, the return on those interest payments will be limited which will reduce overall performance.  Second, premium bonds can experience greater volatility as interest rates rise.  Even investors who are planning to hold bonds to maturity can become unnerved to see their account values fall abruptly.  Bottom line, purchasing premium bonds can pose greater risk than what may be apparent and should be considered carefully.

Should I buy bond mutual funds?  Mutual funds offer some very positive advantages: Diversification, reduced costs when compared to individual bonds, professional management, simplicity, liquidity and convenience.  There is of course a very broad spectrum of bond funds, varying by bond type, maturity, strategy, open versus closed end fund, etc.  It is important to keep in mind that individual bonds typically have a return of par value that is guaranteed by the issuer.  When we invest in open end bond funds, we are buying into an existing portfolio of bonds that is perpetual.  This implies that as bonds within the portfolio mature, the proceeds are usually reinvested in additional bonds.  So, to that extent, we lose the predictability of maturity that individual bonds provide, which may create additional uncertainty and risk factors.

Also, bond funds may be advertised for their relatively high yields, modest average portfolio maturities and average investment grade.  Bond funds, like all mutual funds, are hardly transparent.  We typically do not know the current portfolio holdings until 3-6 months after the fact, a practice funds use to prevent “front running.”  The key is to remember that “average” means there are just as many bonds below as above the figures.  So if a fund’s yield seems too good to be true, it is likely being raised by inclusion of lower grade and/or longer maturity bonds that are being masked within the averages.

Finally, bond funds typically charge 0.50-1.5% in annual management fees.  Especially in a low rate environment, managers are particularly challenged to deliver sufficient value that can compensate for their fees.  Certainly there are opportunities to add value, especially when dealing with more aggressive segments of the bond markets.  For example, the managers that are somehow able to help their investors profit from the European sovereign debt crisis could be worth their weight in gold!  Similarly, those who can successfully navigate the challenging waters of municipal debt and high yield “junk” bond could potentially deliver exceptional value that more than offsets their fees.  But many of these could be considered speculative and only suitable for the more aggressive investor.  For more moderate risk investors seeking a “safe haven” and reliable income, many bond funds can be highly challenged in a low, potentially rising rate environment to earn their keep and more challenged to protect their investor’s principal.

If inflation should rise, what would this mean to my bond investments? Inflation can be a dirty word where bond investors are concerned.  The reason is and as was noted above, most bonds provide a fixed income stream for their lifetimes.  When inflation rises, of course, the purchasing value of such fixed income streams can erode.  So even the very hint of rising inflation can cause volatility in bond markets as bond investors will often sell their holdings and move to cash.  Of course, there are exceptions, such as “floating rate,” “Treasury Protected Inflation,” and “high yield” bonds, which, if properly managed, may have a greater potential to perform.  These aside, in our current environment, where many economists fear that greater inflation may be coming and that the U.S. Govt.’s official inflation indices may not be accurately tracking inflation increases³, bond investors should be wary.

Should I be worried about talk of a “bond bubble? Certainly in the aftermath of the financial crisis, investors poured inordinate amounts of money into individual bonds and bond funds as they sought “safe haven” from the stock market declines.  This was particularly the case but not confined to just U.S. Treasuries.  Jeremy Siegel, renowned author and finance professor at Wharton, has continually warned of bond bubbles developing in 2010 and 2011.⁴ “Now bond bears say the latest rally is setting up the bond market for an even bigger crash (than that of stocks in 2008-09) once interest rates start to rise again.” ⁵ It is almost axiomatic that when we see investors move money at greater than normal rates into a given investment sector, there is cause for concern.  Especially given the cyclical nature of markets, there is certainly enough data to, at the very least, cause concern.

Longer maturity bond have higher yields; should I invest in them?  Yield-hungry investors are often tempted by advertisements promising higher interest rates.  Mutual funds may also use longer term bonds to help increase their stated yields.  It is important to realize that these higher yields come at a price which is often in the form of greater volatility.  The fact is price sensitivity can be affected by a bond’s “duration.”  This is a calculated figure based on several factors including the bond’s interest coupon and its length of time until maturity.  It is widely accepted that “… the greater the length of the bond’s remaining term, the more sensitive it will be to changes in interest rates.” ⁶ Simply put, higher duration and/or longer maturity implies greater price sensitivity, which translates to increased risk.  Investors should be mindful of this in considering whether longer term bonds may meet their needs.

Which types of bonds are most at risk should interest rates rise?  Historic trends also give us some sense of priority and also risks:

• Treasury Bonds provide a reliable return when held to maturity, so they historically exhibit the greatest price decline when market rates increase. ⁷
• Corporate Bonds, because they offer higher yields, can be less sensitive to rising interest rates.
• High Yield Corporate Bonds, because they are typically below investment grade, usually offer higher interest rates.  However, since their fortunes are based more on the issuer’s performance, these can move more in sync with the stock markets and may be the least sensitive to rising rates. “…the problem is that the correlation between high yield bonds and equities has demonstrated a nasty tendency to spike upward just when it is most important for it to remain low – for example, when equities are experiencing negative returns.  Again, this is because much of the return of high yield bonds is a result of risk premiums associated with equities, not debt.” ⁸
• Treasury Inflation Bonds are designed with the goal of maintaining relatively stable principal during rising rate environments.  Whether they do or not depends on many market factors and upon who the issuer is.  “One market that now makes no sense to us is the popular Treasury Inflation Protected Securities (TIPS), where … the yield on the benchmark 10-year TIPS turned negative for the first time in history….” ⁹
• Floating or Adjustable Rate Bonds are loans that financial institutions make to businesses that are often below investment-grade credit quality.  As such, they have a high debt-to-equity ratio and typically generate yields that are greater than investment-grade bonds. Analysts and financial regulators alike have expressed concern to the point of issuing an investor alert, as “… investors may not realize that they could be taking on more risk if they invest in products with higher returns.” ¹⁰ The alert was prompted by the four-fold influx into floating-rate loan funds between 2008 and 2011.

All said bonds values can decrease sharply when interest rates rise.  For example, Treasury yields need only rise 0.3% over one year on average to produce a loss on the Barclays Treasury index, according to a First Pacific Advisors study.  Their advisors see interest-rate risk as at the greatest it has been since the 1950’s. ¹¹ Further, the 10-year Treasury yield is projected to rise to 3.8% by year end, according to the median estimate of 70 economists and strategist surveyed by Bloomberg News. ¹²

Conventional wisdom suggests that traditional fixed income instruments, including bonds of various types, have an important role to play in most investor’s portfolios.  However, in our current low interest environment where the uncertainties are great, many analysts do not see an attractive reward potential to offset the myriad of risk involved in significant bond investing.  In fact, some see bonds as almost impractical on a risk/reward spectrum.  It may very well be that on a longer term basis, we certainly embrace bonds in most clients’ portfolios.  But at a time of so many potential risk exposures, it may be prudent to consider other strategies that can help control portfolio risk and provide predictable cash flow when needed.

Investors should consider the investment objectives, risks, charges and expenses of an investment company carefully before investing. The prospectus contains this and other information about an investment company and is available from your financial advisor. The prospectus should be read carefully before investing.

This information is not considered a recommendation to buy or sell any investment.

Written by
Mitchell E. Kauffman, MBA
Certified Financial Planner^TM
Masters of Science in Financial Planning

Mitchell Kauffman provides wealth management services to corporate executives, business owners, professionals, independent women, and the affluent.  He is one of only five financial advisors from across the U.S. named to Research magazine’s prestigious Advisor Hall of Fame in 2010, and among a select list of 100 over the past 20 years. 

Inductees into the Advisor Hall of Fame have passed a rigorous screening, served a minimum of 15 years in the industry, acquired substantial assets under management, demonstrate superior client service, and have earned recognition from their peers and the broader community.  

Kauffman’s articles have appeared in national publications, and he is often quoted in the media.  He is an Instructor of Financial Planning and Investment Management at the University of California at Santa Barbara, Santa Barbara City College, and Pasadena City College.  

For more information, visit www.kauffmanwealthservices.com or call (866) 467-8981.  Kauffman Wealth Services is an independent Registered Investment Advisor and serves clients from two office locations: 140 South Lake Avenue,  Pasadena, CA 91101 and 550 Periwinkle Lane, Santa Barbara, CA 93108.   Securities offered through Raymond James Financial Services, Inc., member, FINRA/SIPC.

A take-off on the old adage “significant savings can often be had to those who ‘don’t wait’” states the case with year-end tax planning.  A few smart moves prior to Dec. 31^st can make a significant difference in your April tax bill.  The key for most of us will be to defer income and accelerate deductions.

Some common income deferrals include:

1. Delay year-end bonus, compensation, payments for service, and rents;
2. Postpone retirement plan distributions that are not required;
3. Hold off on the sale of capital gain property until after January 1^st, or opt for installment payments instead of lump sum.

Typical deduction acceleration methods are:

1. Pre-pay deductible interest as well as state payments for property and estimated income taxes;
2. Make charitable contributions prior to year-end.  Where gains exist, consider gifting appreciated investments rather than cash so to get a deduction for the entire market value without having to realize the taxable gain.
3. Be sure to maximize deductible IRA ($5,000 plus an additional $1,000 for those over 50 for 2011; indexed to inflation in subsequent years) and SEP ($49,000 based on eligible compensation) & 401K retirement plan employee salary deferral contributions ($16,500 plus an additional $5,500 for those over 50).  Remember an unemployed spouse may also be eligible for the IRA.

Investors want to be mindful of a few points as well:

1. New mutual fund investments may be best delayed until after year-end distributions have been made.  This is because distributions are blindly made to an owner on a given date of record without regard to how long the investment was owned.  For example, a 10% capital gain distribution for record owners of December 13^th; a December 12^th investment of $10,000 could result in a $1,000 taxable capital gain with no mitigating advantage.
2. Offsetting realized gains with losses can help as well, so long as the sales do not cause adverse investment results.  Keep in mind the 30-day “wash sale” rules, and up to $3,000 of investment tax loss can be applied against income from other sources.
3. Charitable IRA’s: Those over age 70½, who are faced with taking Required Minimum Distributions (RMD) from their IRA, can opt to have up to $100,000 of the balance contributed to the charities of their choice directly. By doing so, they can satisfy their RMD and may come out ahead tax-wise.
4. Roth IRA Conversion: In select situations, it can be beneficial to have some or all of a traditional IRA converted to a Roth. When considering this, the upfront tax cost must be weighed carefully against the longer term benefit that a “tax-free” Roth can provide.

For self-employed professionals and small business owners, recent legislation makes it advisable to re-evaluate your retirement plan structure. As an example, a self-employed individual with $100,000 of net profit could only fund $18,587 to her SEP IRA, but was able to fund $35,087 ($40,587 if over 50) to a one person 401K.  The difference could result in an additional tax savings of almost $10,000.

For some, it may be even more advantageous to consider a defined benefit pension plan.  Another self-employed client in his late 50’s, who was able to make a $220,000 deductible contribution based on his $400,000 salary.  This is expected to generate a tax savings of $100,000.  Certainly, much depends on the circumstances, such as the owner’s age, income history and whether other employees were involved.

Many semi-retired clients, for example, are compensated as independent contractors for consulting and for serving on corporate boards.  Depending on the situation, they may be able to establish a pension plan that might allow a substantial contribution to offset the majority of this income.  The trick is that these plans generally need to be established prior to year-end.

If you are one of the over 3 million taxpayers subject to the Alternative Minimum Tax, it may be better to accelerate income and defer deductions.  That is because the AMT, with its own system of rates and rules, will disallow many itemized deductions.  For example, AMT taxpayers could hurt themselves by pre-paying their state taxes in the current year.  They may also find portions of their mortgage interest expense disallowed.

There are a myriad of other year-end tax savings tips.  Don’t forget; for those in the higher tax brackets, $1,000 in additional tax deduction may result in almost $400 in actual tax savings.  Awareness and acting prior to year-end are the keys to effective tax planning.  Meet with your tax or financial professional soon.  It may well be the best investment you make all year!

Note: Any information contained herein is not a complete summary or statement of all available data necessary for buying or selling any investment and does not constitute a recommendation.

This information is not considered a recommendation to buy or sell any investment.

Written by
Mitchell E. Kauffman, MBA
Certified Financial Planner^TM
Masters of Science in Financial Planning

Mitchell Kauffman provides wealth management services to corporate executives, business owners, professionals, independent women, and the affluent. He is one of only five financial advisors from across the U.S. named to Research magazine’s prestigious Advisor Hall of Fame in 2010, and among a select list of 100 over the past 20 years.

Inductees into the Advisor Hall of Fame have passed a rigorous screening, served a minimum of 15 years in the industry, acquired substantial assets under management, demonstrate superior client service, and have earned recognition from their peers and the broader community.

Kauffman’s articles have appeared in national publications, and he is often quoted in the media. He is an Instructor of Financial Planning and Investment Management at the University of California at Santa Barbara, Santa Barbara Community College, and Pasadena City Colle

For more information, visit www.kauffmanwealthservices.com or call (866) 467-8981. Kauffman Wealth Services is an independent Registered Investment Advisor and serves clients from two office locations: 140 South Lake Avenue, Pasadena, CA 91101 and 550 Periwinkle Lane, Santa Barbara, CA 93108. Securities offered through Raymond James Financial Services, Inc., member, FINRA/SIPC.

So, what do you do now? With portfolio and home equity values having fallen by 1/3 or more over the past year, many planning for or already in retirement are asking this painful question as they hope to enjoy their “Golden Years.”  Sadly, over 65% of workers age 45+ expect to delay retirement and work longer as a result of the current economic turmoil.

Even before the economic meltdown, psychologists have long described retirement as one of the top 10 “Life Stressors”.  This is due to the obvious financial and emotional challenges that must be addressed.  Arguably, our current economic dilemma may have moved this up the scale considerably.

There are a number of key strategies that can make a significant difference as you plan for or re-evaluate your retirement during these tumultuous times:

1. Review Your Living Expenses: Categorize your outflow into three groups; 1) Survival, i.e. food, housing and health care that are essential; 2) Desired, which are discretionary lifestyle extras like entertainment and vacation; and 3) Legacy, which include gifts and inheritances to others.  This prioritization will be valuable should your income decrease and as a basis to project your retirement needs.
2. Don’t Time the Market: While tempting, studies show that timing only accounts for 1.8% of total portfolio performance (adapted from Financial Analysts Journal, May-June 1991).  Another study by ICMA-RC¹ showed that if you missed just 10 of the top performing days over the 20-year period (8/1991-8/2011), your portfolio would have underperformed by over 3.5% per year!  Remember, by the time you see performance, it is usually too late.
3. Re-Balance Your Portfolio: During any business cycle, there are winners and losers.  Make sure your investments are balanced and diversified according to your risk tolerance, timeframe, growth and cash flow needs.
4. Be Skeptical of Doomsayers:  Especially during tough times, prognosticators abound.  Economics is a ‘soft’ science at best wherein even the brightest Nobel Laureates are wrong a significant percentage of the time.  There is an old saying, “put 5 economists in a room and you’ll get 10 different opinions.”
5. Seek Objective Expert Advice: Many blame Wall Street’s “sales” mentality for some of its economic woes.  Just as surgeons don’t operate on family members themselves, it is good to have an outside opinion.  Get advice from an independent Certified Financial Planner™, who has no bias from their employer’s proprietary products.  A “client-centric” model that focuses on your needs first and foremost, and integrates investments with the rest of your financial picture, may be the best road to success.
6. Update Your Retirement Plan: Everyone can benefit from having a plan that can provide lifetime income and establishes the feasibility of their retirement goals.  If you don’t have one, get one.  If you have one, update it to see what adjustments may be needed.  Remember, those who fail to plan, plan to fail.
7. Consider Getting a Second Opinion: Just as in medicine, a qualified second opinion can never hurt even if you believe you have all your bases covered.
8. Dollar Cost Average: If you have extra cash, consider investing a specific amount each month.  If you are eligible for a 401K or other retirement plan through your employer, keep funding it.  The DCA automatic process is a disciplined method that helps you buy fewer of the expensive shares and more of the cheap shares as markets fluctuate.  While no guarantee, it can, over time, mean a lower average cost and the potential for more profit.
9. Keep the Long Term Perspective: Despite the persistently high unemployment figures, recent economic data suggests we are not likely to hit another recession.  The reality is that we are coming off the worst downturn in almost a century.  As such, the recovery will take time.  Just as when we were in the midst of the “good times” and no end seemed in sight, it is tempting to see the “tough times” as going on forever.  The unprecedented, world wide government efforts to stimulate our economies will pay off and we will get through this.
10.  Remember the Pendulum Principal:  Investor behavior is prone to excesses and deficiencies much the way a pendulum often over-swings its mark.  One need only look at the current near-zero or negative yields on Treasury Bills to realize that the flight to safety may be overdone.  Just as we had the “Tech Bubble” and the “Real Estate Bubble,” we are likely in the midst of a “Panic Bubble.”  Resist the temptation to “follow the herd” in making emotional decisions that you may regret later.

The irony is that people are not naturally wired for investment success; they typically sell low and buy high because of emotional reactions.  Study after study cites this as the number one factor in explaining why individual investors chronically underperform the markets.  It is another reason why it is critical to have an objective plan that can provide guidance during unnerving times.

Investors are reminded that dollar cost averaging (DCA) and diversification does not assure a profit and does not protect against loss in declining markets.  Since DCA does involve continuous investments in securities regardless of fluctuating markets, investors should consider their willingness to continue purchases during market downturns.

This information is not considered a recommendation to buy or sell any investment.

Written by
Mitchell E. Kauffman, MBA
Certified Financial Planner^TM
Masters of Science in Financial Planning

Mitchell Kauffman provides wealth management services to corporate executives, business owners, professionals, independent women, and the affluent. He is one of only five financial advisors from across the U.S. named to Research magazine’s prestigious Advisor Hall of Fame in 2010, and among a select list of 100 over the past 20 years.

Inductees into the Advisor Hall of Fame have passed a rigorous screening, served a minimum of 15 years in the industry, acquired substantial assets under management, demonstrate superior client service, and have earned recognition from their peers and the broader community.

Kauffman’s articles have appeared in national publications, and he is often quoted in the media. He is an Instructor of Financial Planning and Investment Management at the University of California at Santa Barbara, Santa Barbara Community College, and Pasadena City CollFor more information, visit www.kauffmanwealthservices.com or call (866) 467-8981. Kauffman Wealth Services is an independent Registered Investment Advisor and serves clients from two office locations: 140 South Lake Avenue, Pasadena, CA 91101 and 550 Periwinkle Lane, Santa Barbara, CA 93108. Securities offered through Raymond James Financial Services, Inc., member, FINRA/SIPC.

¹  Stocks are represented by Standard & Poor’s Composite Index of 500 stocks, and unmanaged index that is generally considered representative of the U.S. stock market. Past performance is not a guarantee of future results.

Increasingly Complex at an Accelerating Speed!  Our world is changing as never before.  Keeping up on important financial information has never been more important and more challenging.

To meet that challenge, we have just completed a total revamp of our website at www.KauffmanWealthServices.com. Now, you can readily access more resources, more easily and quickly!  Among the many enhancements, you will find:

1. Totally Searchable: All of our research content has been converted to “Blog” format and is now easily accessible.  Just use the key word search bar at the top of the right column on each page.  Now this important, published information is at your finger tips;
2. What’s New: At the top of the left column, our most recent three articles and research papers are readily available;
3. Market Update Newsletter Sign Up: For those not currently receiving our valuable weekly updates, signing up has just gotten easier with the new signup box on the right column toward the bottom;
4. Social Media: Follow us on Facebook, LinkedIn, Twitter and YouTube for even more current information using the convenient buttons to the right of each screen;
5. Up to the Minute Financial Tools & Reports: Available under the Tools & Resources menu, this link gives you access to the entire resource library available from Raymond James;
6. Who We Serve:Our clients face challenges and we offer our tailored solutions to help them.  Examples are easily accessible through the horizontal photo band across the top and also on the “Who We Serve” drop down menu, second from the left.  This can be a great way to help your friends and colleagues understand how we deliver customized solutions to their toughest questions:
   1. Business Owners seeking to enhance their personal benefit from or planning to sell their business;
   2. Executives wanting to optimize their firm’s benefits packages;
   3. Single Women wanting to have more confidence and control over their finances;
   4. Retired or Contemplating Retirement and wanting to know how to achieve financial independence;
   5. Affluent or Suddenly Affluent and wanting to preserve their legacy for heirs and charitable causes.

1. Why Choose to Work with Us & What Makes Us Different: There, you will find, in black and white, what we stand for, and the financial philosophies we use to help you achieve a “Life Well Lived.”

Besides resources, I am proud of how this site really captures the essence of our service and disciplines.  It speaks to my personal passion for our service, why we do what we do and how it works!

Also consider this as a valuable tool for your friends and colleagues to understand the benefits of what we do.  These days, with the challenges we face, now more than ever we are seeing how a Second Opinion can make all the difference.

Let me invite you to explore its easy navigation and lend your feedback.  At Kauffman Wealth Services, we work to earn your business every day.