Am I My Brother’s Keeper?

 By Glenn J. Downing, MBA, CFP®

You may have noticed in all CameronDowning email signatures this text:

                                      Where 5% of all revenue is donated

                                        To homeless assistance in Miami.

What’s behind this?  I thought my readers might find the story interesting.

Shortly after Jonathan Cameron and I founded CameronDowning in 2014, I read a piece in the Wall St. Journal about companies that fulfilled their ethical obligations to the community by giving money to charitable endeavors off the top, rather than as planned gifts.  This really caught my attention.  Lots to consider here. 

An obligation?  As a business do we have an ethical obligation to the community at large?  After all, one...

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Fair is Where You Go to Ride Rides

By Glenn J. Downing, MBA, CFP®

Child:  But Daddy – that’s not fair! 

Daddy:  Well, son, life’s not fair.  Whoever said it is lied to you.  Fair is where you go to ride rides. 

Anyone who’s ever been in one of my CFP® classes has heard me use this expression, and indeed I picked it up in one of my own CFP classes.  Yes, the practice question you’re trying to answer may not be fair, but the CFP® Board tests you with questions like this, so toughen up.   

Fairness, Justice, and Equity

I’ve been thinking about fairness lately, along with justice and equity, and the different shades of meaning in the words.  I think of fairness in terms of fair play, i.e. the referee applies the rules even-handedly to both teams with no partiality.  Justice, on the other hand, speaks to issues of right and wrong in our relationships with one another.  Right behavior is just behavior, and wrong...

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Cash is Still King! (Part Two)

Ah, greenbacks, lettuce, clams, or Benjamins – no matter what we call it,  cash is still king!  There are few places in the world that will not take the American dollar as payment.  I fact, I can only think of two:  inflight on American Airlines, and Uber.   

Any Reasons NOT to Use Cash?

Here’s a valid reason NOT to use cash:  if some young socialist decides to knock you over the head to redistribute your wealth, those dollars are gone and cannot be replaced.  Had the young socialist only reaped your credit cards, you can get on the phone and stop those cards, and you have only a maximum $50 liability per card, if even that. 

Another reason not to use cash is airline miles and hotel points.  This is my personal practice.  We run as much as possible through the American Airlines cards and the Marriott Visa, and the points (and benefits) really add up!  But if you’re going to do this, you must have the...

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Cash is Still King! (Part One)

Here’s a question for you, ladies.  You’re out on a first date at a restaurant with someone new.  You’re interested . . . not sure, but interested.  It’s just a date . . . let’s see how the evening goes, you think to yourself.  When it comes time to pay the check, he:

  1. Pays with a gold card
  2. Flashes a thick wad of greenbacks and pays cash.
  3. Tells you how much your half is.

If it is #3, dump him right then and there and block his phone number. 

But between #1 and #2, which impresses you the most?

Credit was for Losers

Way back when I was a young man people paid cash for most everything.  In fact, it was a mark of pride to do so.  Credit was for people who couldn’t afford to pay cash – losers, in other words.  But now!  After working with many clients on cash flow organization, I can tell you that most people simply use a card to purchase everything, and most millennials don’t even carry cash.

...
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10 Places to Get Your Hands on Some Quick Cash

by Glenn J. Downing, MBA, CFP®

Everyone at some time or another needs some cash - and quickly!  The question is, have you anticipated this need and saved into it?  Or do you need to scramble?  What follows is a list of ten helpful suggestions.  

Here are 10 places to consider, in descending order.  

  1. Your emergency fund.  But if you’re reading this, I’m guessing you haven’t established and funded your emergency fund.  So when this particular cash shortfall hump is over, you know what you need to do!
  2. Tap a relative. Be sure to repay promptly along with a suitable gift, i.e. a gift card, nice bottle of wine, etc.
  3. A 401K loan. In this case you’re borrowing money from yourself.  There will be an interest charge, but you’d be paying the interest back into your own account.  Typically, you can borrow out the account value up to $50,000, and you replay the loan through payroll withdrawal. ...
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The Wisdom of the Cheshire Cat

 By Glenn J. Downing, MBA, CFP®

What follows is one of my all-time favorite quotations, from Alice’s Adventures In Wonderland.  The background is that Alice has come to a fork in the road and wonders out loud which way to turn.  The Cheshire Cat materializes, and the following conversation ensures:

Alice asked the Cheshire Cat, who was sitting in a tree, “What road do I take?” The cat asked, “Where do you want to go?” “I don’t know,” Alice answered. “Then,” said the cat, “it really doesn’t matter, does it?”

The Heart of Financial Planning

This gets to the very heart of financial planning.  How are your invested assets to be used?  What is the purpose for these dollars?  What do you want to accomplish? 

Our point is that investment accounts don’t (or shouldn’t) exist in a vacuum.  Purpose and time horizon inform the ultimate investment choices. ...

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No One Uses Cash Anymore!

 By Glenn J. Downing, MBA, CFP®

I can now pay for a Tesla with Bitcoin.  And the Mayor of Miami wants to pay City employees in Bitcoin and allow tax payments in the same cryptocurrency.  Honestly, until I can go into Bloomingdale's and buy a shirt with Bitcoin, it doesn't much matter to me.  

And neither should it to you, if you’re in the process of getting your financial house in order.  In my world of financial planning and investment management, the basics are still the pathway to financial freedom and prosperity:  spend less than what you earn and invest the rest. 

No One Uses Cash Anymore

The rub is that many people don’t know what they spend because no one uses cash anymore.  It used to be that if a man wanted to impress a lady, he’d flash a bankroll when paying the restaurant check.  Now, she’d probably flee the table at such Neanderthal behavior:  it is the gold or platinum cards that...

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When Does a Refi Make Sense?

by Glenn J. Downing, MBA, CFP®

With mortgage rates so low, we’ve been looking at mortgage refinancing for a few of our clients lately, to see if it might be in their best interests.  Here’s what we know: 

  • For those with strong credit, 30-year rates are just below 3%, and 15-year rates are in the 2.6% range. This makes sense in that the lender takes on less risk in loaning out mortgage funds for just 15 years, as opposed to 30 years.  Consequently, there is a better rate on offer.  The rate difference we see here, about 0.4%, won’t be enough to compensate for lopping 15 years off the payment period.  It’ll help some, but the 15-year mortgage will definitely carry a higher payment. 
  • It costs money to initiate a new mortgage – as much as 3% to 5% of the mortgage itself. There are lots of costs and taxes involved, including application fee, title search, title insurance, appraisal, transfer taxes, etc.  Typically...
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Will Social Security be There When I Retire?

 

By Glenn J. Downing, MBA, CFP®

This piece is the third in a Social Security trilogy.  The first is Social Security Benefits, and the second is Taxation of Social Security

A common question I’m asked in a financial planning engagement is this:  Glenn, should I plan on receiving Social Security?  Will it even be there for me?  I’ll say yes – plan on it.  Social Security is the third rail of politics, and it is my belief that it will always be there in some form or another.  For those of you who’ve never lived in a city with a subway, the third rail is an electrified rail that runs along the tracks.  There is a foot from the rail car that rides along the third rail, thus powering the car with electricity.  Pretty much instant electrocution if you touch it.

Throughout its history Congress has bought itself votes by increasing the benefit, but they haven’t always raised revenue, i.e. taxes, in a...

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Ten Important Ages in Financial Planning

By Glenn J. Downing, MBA, CFP®

I thought I’d put together a short list of the most important ages in financial planning.  The ages on the list changed a bit in 2020, so a review is in order.  Look up your age and see what’s happening for you!

Age 21 – UTMA account becomes the child’s 

An account registered as a Uniform Transfers to Minors Act is one in which a trust is created by the donor for the benefit of the minor child.  The donor retains his status as trustee until the child reaches the age of majority – 21 in Florida.  Be careful if you’re using an UTMA for college funding:  at age 21 the minor comes of age and can use the money in the account for anything he wants, including blowing it on a Ferrari.  There’s nothing the donor can do at that point – he’s lost all control. 

Age 30 – Coverdell College Savings Accounts must be distributed

A Coverdell is the original education...

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