Live Well Archives - Page 3 of 3 - NorthStar Capital Advisors

What Assets Make Up Wealth?

This is the time of year where our office is busily updating our clients’ net worth statements. Net worth is the best measure of both your current financial health and the financial progress you’re making over time. Remember that your net worth, simply put, is the sum of all the financial assets you own minus all of the debts that you owe. Almost every good financial decision you can make serves to either grow or protect your net worth. For example, saving and investing increase your the financial assets you own, while paying off debt decreases the amount you owe.

The Visual Capitalist recently published the fascinating chart below that examines how the composition of assets varies by net worth.

It’s readily apparent that the asset mix changes greatly between lower and higher net worths:

Primary Residence:
This is by far the most important asset class for all net worth tiers up to $1 million.

Vehicle:
For the $10k net worth tier, the value of a vehicle is more than investments such as pensions, IRAs, mutual funds, stocks, etc.

Stocks:
The proportion of directly-held stock increases up the tiers, and billionaires hold a significant portion of wealth in stocks.

Business Interests:
Most multi-millionaires or billionaires are not liquid, and have most of their wealth in business interests.

Donate Wisely

Whether you’re contemplating a last-minute donation for 2017 or planning a major move to define 2018, we advise you to donate wisely. The awesome decision tree below from Bloomberg assembles the advice from philanthropic advisers, nonprofits, and volunteer experts to help narrow down the best method of giving for you. Download a PDF if you’re having trouble reading it below.

Insights from Longevity Village

There’s a village in China where centenarians are ten times more common than in the United States. Bapan, China is called “Longevity Village” thanks to this density of 90+ and 100+ year old residents. Most of these older villagers are living long and healthy lives. Aging very slowly, there is essentially no signs of obesity, cancer, heart disease, or dementia.

Dr. John Day has written a book on Longevity Village that shares insights for living a long and healthy life. The villagers of Bapan have diet that is free of added sugars and processed foods. They get plenty of exercise with many 90 and 100 year olds still working in their gardens.

But four attitudinal elements are key as well:

Smile more (baseball players who smile in their playing card photographs live 7 years longer on average than those that don’t smile)
Rethink stress (70% of doctor visits in the US are stress-related)
Don’t forget to play (exercising in itself is not playing)
Look forward to aging (people who embrace the aging process live 8 years longer than those that don’t)

Source: WSJ

10 Life Lessons We Learn Too Late

A few years ago someone on Quora.com asked the question, “What are the lessons people most often learn too late in life?” Jay Bazzinotti provided the following brilliantly insightful response:

1. Time passes much more quickly than you realize.

2. If you don’t take care of your body early then it won’t take care of you later. Your world becomes smaller each day as you lose mobility, continence and sight.

3. Sex and beauty may fade, but intimacy and friendship only grow.

4. People are far more important than any other thing in your life. No hobby, interest, book, work is going to be as important to you as the people you spend time with as you get older.

5. Money talks. It says “Goodbye.” If you don’t plan your finances for later in life, you’ll wish you had.

6. Any seeds you planted in the past, either good or bad, will begin to bear fruit and affect the quality of your life as you get older — for better or worse.

7. Jealousy is a wasted emotion. People you hate are going to succeed. People you like are going to sometimes do better than you did. Kids are going to be smarter and quicker than you are. Accept it with grace.

8. That big house you had to have becomes a bigger and bigger burden, even as the mortgage gets smaller. The cleaning, the maintenance, the stairs — all of it. Don’t let your possessions own you.

9. You will badly regret the things you didn’t do far more than the things you did that were “wrong” — the girl you didn’t kiss, the trip you didn’t take, the project you kept putting off, the time you could have helped someone. If you get the chance — do it. You may never get the chance again.

10. Every day you wake up is a victory.

Giving the Gift of Financial Planning

A Lifetime of Financial Knowledge Wrapped Up in a Bow

Stuck for ideas on what to give newlyweds, graduates, or new parents for Christmas or Hanukkah? Consider something nontraditional this year that will last a lifetime and never go out of style: a visit with a financial planner.

Giving someone a financial planning consultation is a unique way to show you care, and it can help set up a loved one for a successful financial future. Newlyweds, graduates, and new parents all are at the start of a new phase of their lives. A financial planning gift provides them with something that may last for decades.

Those experiencing life’s transitions will also face financial challenges. Whether it’s learning to budget as a couple, understanding retirement plan options at the first job after graduation, or starting to think about paying for college, many important financial decisions await young people today. You can help by putting financial planning front and center.

Maintain the Wedded Bliss

Money and finances are among the top issues that cause marital discord. A financial planner can help strategize for a happily-ever-after financial life. A good planner will spend time talking to the couple, helping them determine their mutual financial goals. There are so many topics a financial planner can help with, including: managing household expenses; reviewing assets, debts, and credit reports; creating a budget; discussing future goals and creating mutual goals such as buying a home; analyzing benefits; updating wills; and reviewing insurance coverage.

Help Graduates Start Right

Once the diploma is hanging on the wall, it’s tempting for new grads to overspend, racking up credit card debt and a new car loan when what they really need to be worrying about is paying down student loans and planning for retirement. A gift of financial planning can help a new graduate establish short- and long-term financial goals and develop a budget to meet those goals. A financial planner may also help the grad deal with the new challenge of filing taxes and make recommendations on how to allocate investments into 401(k) or other retirement savings vehicles.

Bringing Up Baby, or Babies

The government estimates that a middle-income family will spend more than a quarter of a million dollars to raise a child until he or she is 18. New parents will benefit by working with a financial planner to figure out how much money they’ll need to raise their child. A financial planner can help them create a savings safety net, create and stick to a budget, advise about life insurance and wills, and talk about saving for college.

Purchase a financial planning gift certificate for someone you care about and know you’ve made a lasting contribution!

Your Investments Don’t Care Who Wins

Countless words and boundless time have been expended over the ages debating which political party is best for the investment markets. Good news! You can stop worrying and wasting your time because 160 years of history are very clear on this question.

Vanguard research going back to 1853 demonstrates that stock market returns are virtually identical regardless of which party is in the White House (see chart above). Similarly, Vanguard finds the political party of the president has little impact on the bond market as well.

So take a deep breath and relax because your investments* don’t care who wins on November 8th.
(* “your investments” should be a diverse portfolio of assets that serves a long-term investment discipline that is goal focused and planning driven)

Source: Vanguard

Happy Money: The Science of Smarter Spending

If you think money can’t buy happiness, you’re not spending it right. Two rising stars in behavioral science explain how money can buy happiness—if you follow five core principles of smarter spending:

1. Buy Experiences
2. Make it a Treat
3. Buy Time
4. Pay Now, Consume Later
5. Invest in Otheres

“Buy Experiences” essentially means to spend money on memorable experiences instead of expensive toys, because you are able to relate to those experiences on an emotional level for much longer that with objects.

“Make It A Treat” focuses on the concept of over-consumption creating a weakening of the enjoyment factor. If you have something every day, even if it’s something you love, it becomes routine rather than fully enjoyable.

“Buy Time”: The idea that you make life decisions that allow you to have more free time. Suggestions include outsourcing unnecessary tasks.

“Pay Now, Consume Later” is a fascinating concept. In society today, we’re more apt to do the reverse, thanks to credit cards. Essentially, it’s sort of like half the fun of a road trip is getting there. When consummation is delayed, from something as simple as eating candy to attending an event, the enjoyment is increased. When something’s already paid for, if enough time passes, it seems “free” when it’s actually consumed.

“Invest In Others” hits on how donating or spending money on others feels better than buying things for yourself.

Happy Money (by Elizabeth Dunn and Michael Norton) offers a tour of new research on the science of spending. Most people recognize that they need professional advice on how to earn, save, and invest their money. When it comes to spending that money, most people just follow their intuitions. But scientific research shows that those intuitions are often wrong.

Happy Money explains why you can get more happiness for your money by following five principles, from choosing experiences over stuff to spending money on others. And the five principles can be used not only by individuals, but by companies seeking to create happier employees and provide “happier products” to their customers.

By the end of this book, readers will ask themselves one simple question whenever they reach for their wallets: Am I getting the biggest happiness bang for my buck?

What You Should Focus On

We all want to live a great life. The path to achieve that life relies, in part, on knowing what to focus on and what to ignore. Focusing on the things you can’t control is a waste: a waste of time, energy, and often, money. Here’s a list of things that matter, things you can control, and the things you should focus on.

Things that matter:

Health
Human progress
Long-term market returns

Things that you can control:

How you treat people
Feeling good about yourself
Making smart financial decisions

What you should focus on:

Living a happy, productive life
Surrounding yourself with good people
Not letting a long-term plan be derailed by the current market environment

Source: Carl Richards, Michael Batick

5 Words of Advice for New Graduates

Congratulations to the 3 million young people who have graduated from high school over the past few weeks! Want to be happy and prosper? Consider these 5 words of advice from 20 thoughtful people:

Budget. Save. But enjoy yourself.
Ben Carlson, A Wealth of Common Sense

Live simply. Fees add up.
Kanyi Maqubela, Collaborative Fund

Buy every month, never stop.
Josh Brown, Reformed Broker

Save. A lot. Start immediately.
Bob Seawright, Madison Avenue Securities

Carl Richards, The New York Times

Your potential is an asset.
Noah Smith, Bloomberg

Sleep on it. Then decide.
Sam Ro, Yahoo! Finance

Live on less. Have more.
James Osborne, Bason Asset Management

The world owes you nothing.
Jason Moser, The Motley Fool

Savings is the best investment.
Tadas Viskanta, Abnormal Returns

Perpetually seek your true passions.
Tom Gardner, Motley Fool CEO

“No downside” means “run away.”
Bill Mann, CIO Motley Fool Asset Management

Time is your scarcest asset.
Bryan Hinmon, Motley Fool Asset Management:

Don’t carry credit card debt.
Eddy Elfenbein, Crossing Wall Street

It’s not a race. It’s a marathon.
Craig Shapiro, Collaborative Fund

Focus on what you control.
Phil Huber, Huber Financial Advisors

Invest as soon as feasible.
Matt Argersinger, Motley Fool analyst

Never stop asking questions. Ever.
Chris Hill, Motley Fool radio host

Your best investment is yourself.
Cullen Roche, Pragmatic Capitalism

Spend less than you make.
Matt Koppenheffer, Motley Fool

Source: TMF

NorthStar Client Family Featured in AARP The Magazine

Debra and Gary Wilhoit, a NorthStar client family, are featured in the June/July 2016 issue of AARP The Magazine. Dr. Chris Mullis, CEO and senior planner at NorthStar, is quoted in the article alongside senior advisors from Charles Schwab and T. Rowe Price.

Kudos to the Wilhoits for candidly sharing their early-retirement anxieties and the actions they have taken to ultimately reach greater peace of mind and long-term success. Millions of Americans who are transitioning toward and into retirement can immediately relate to the Wilhoits’ experience. And millions of Americans can benefit by adopting the Wilhoits’ long-term perspective and positive investor behavior.

AARP The Magazine addresses the evolving life stages of 50+ Americans and is the largest circulation magazine in the United States (35.9 million readers).

1 23