3 Tall Ships Takeaways

If you’ve never been to a Tall Ships event, you should endeavor to do so -- seeing these magnificent ships is quite a site to behold.

I was able to observe a couple of these ancient and also “made to look ancient” beauties sailing into Boston Harbor for a event, and a couple of things really struck me.

First, in this particular case, the Tall Ships were sailing into the Harbor against a pretty strong headwind. Many of the ships have large, square sails and as many skippers will tell you, it’s nearly impossible so sail into the wind with those sails, so they were heading in under motor power. Sailing is faster and cheaper – so whenever possible, get behind a business tailwind! Every industry has headwinds and tailwinds. We should look for those trends in our industry and get behind them. In financial services, those tailwinds are probably fiduciary advice, low cost products and transparent fees. I for one am glad that I’m not sailing into those headwinds.

Second, I was struck by the diversity of ships and the many different ports of origin that were all coming together for this event. Sure, people like to visit one amazing ship like the U.S.S. Constitution, but when ships from all over the world arrive, well, that really turns people out. Diversity is good in many business contexts, but it is especially valuable in long-term investing. Helping you build a high quality, diversified portfolio is one of the most impactful services that working with an Registered Investment Advisory firm can provide.

Lastly, it’s great to see something with such a long history endure. Sure, we sail with carbon-fiber sails and GPS technology, but many of the tools and techniques that were used to sail ships hundreds of years ago are still practical today. “Sailing by feel” is as relevant today as it was hundreds of years ago. That ability comes from years of experience and in many ways, expertise was, and still is, the coin of the realm. In whatever you do, become an expert.

If you would like to meet with an advisor to discuss where your financial ship is sailing, we would love to talk to you and help you captain your way to financial security.

PLEASE REMEMBER:

- INVESTING AND INVESTMENT MANAGEMENT INVOLVES RISK, INCLUDING THE LOSS OF YOUR INITIAL INVESTMENT OR ANY INVESTMENT GAINS.

- PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.

- THIS GENERIC INFORMATION IS PROVIDED FOR EDUCATIONAL PURPOSES ONLY AND SHOULD NOT BE CONSTRUED AS A RECOMMENDATION FOR ANY INDIVIDUAL TO TAKE A SPECIFIC ACTION.

- PLEASE INVEST PRUDENTLY AND SEEK PROFESSIONAL HELP FROM A FINANCIAL ADVISOR, INVESTMENT MANAGER, ACCOUNTANT, LAWYER OR OTHER PROFESSIONAL ON MATTERS THAT YOU ARE UNSURE OF OR THAT ARE UNIQUE TO YOUR PERSONAL CIRCUMSTANCES.

- FINANCIAL PLANNING AND INVESTMENT MANAGEMENT SERVICES PROVIDED BY J. BRADFORD INVESTMENT MANAGEMENT, NASHUA NH.

5 Ways to pick your 401(k) or 403(b) differently than your basketball bracket

TOURNAMENT TIME

No doubt your office sports guru or the take-charge sports fan in your life has distributed brackets or the URL for you to make your picks in the upcoming NCAA basketball tournament.

But if you’re like most of us, you don’t know a whole lot about college basketball, you haven’t watched that many games throughout the season, and you probably won’t get around to doing the picks until just before the deadline.

When it’s time to pick, you’ll implement some combination of well-known strategies to choose your teams – pick the higher seed, pick teams playing close to home, pick teams that are hot and the ever-popular, pick the team with the cutest mascot. Maybe this year you’ll get lucky…

That kind of cavalier approach is probably fine for your basketball bracket, but if you pick your 401(k) or 403(b) investments in a similar fashion, you could be significantly and negatively impacting your investing objectives.

FIVE STEPS

So how do you pick investments from that daunting list of investment choices? Truthfully, it’s not easy and it can be quite complicated based on your situation and your individual risk factors, but in general there are five basic steps everyone should follow:

1)     You should first determine your ability and willingness to take risk. This can generally be accomplished by taking a risk questionnaire or other assessment tool either on-line or with a professional.

2)     You should align your risk tolerance with an appropriate asset allocation. There too, there are many sophisticated models available on-line, usually used in conjunction with a questionnaire or you can discuss your situation with a professional. No one single chart can be used by everyone, but a simple model may look something like this one, which is provided for illustrative purposes only.

3)     Determine the asset allocation mix of the funds available to you and find the possible combinations of funds that align to your allocation. There may be funds that you don’t want in your allocation and there may be many choices to meet a particular category, such as U.S. stocks. You’ll also want to be sure that your selections provide enough diversification, particularly if you have company stock.

4)     Make your final selections. Once you have a diversified mix of possible choices across multiple asset classes and are still trying to choose which ones - funds with lower fees and funds that have higher risk adjusted returns are two areas to consider focusing on. Sometimes that information is summarized in a nice chart and sometimes that information is provided in summary form through a third party, but often you have to go from fund to fund to make that assessment. Assessing funds against their benchmark and against their peers is another prudent step.

5)     Finally, you need to periodically rebalance your portfolio. As investments increase and decrease in value, your portfolio may become riskier than you intend or not be risky enough. You may have to buy or sell some positions to bring your asset allocation back into balance.

Again, each of those steps can have many complicating factors depending on your individual situation. If you would like help with any of the steps above or would like professional management of your 401(k) or 403(b), please schedule a free consultation or give us a call.

PLEASE REMEMBER:

- Investing and investment management involves risk, including the loss of your initial investment or any investment gains.

- Past performance is no guarantee of future results.

- This generic information is provided for educational purposes only and should not be construed as a recommendation for any individual to take a specific action.

- Please invest prudently and seek professional help from a financial advisor, investment manager, accountant, lawyer or other professional on matters that you are unsure of or that are unique to your personal circumstances.

- Financial Advisor and Investment Management Services provided by J. Bradford Investment Management, Nashua NH.