Brightworth, Atlanta Financial Advisors, Say Taming the U.S. Budget Beast Has Been Done Before

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Brightworth
    ATLANTA, GA, May 17, 2012 /24-7PressRelease/ -- In recent years, U.S. budget deficits and the national debt have grown rapidly. Today, many in Washington and around the country think the runaway debt is out of control and cannot be turned around. However, Brightworth, Atlanta financial advisors, say some may be surprised to learn we've been here before and were able to bring the debt back down.

During World War II, the United States ran massive budget deficits that caused our debt to Gross Domestic Product (GDP) ratio to skyrocket from 44 percent in 1940 to 109 percent in 1946. As the war came to an end, the United States sharply reduced its military and overall government spending.

Cutting government spending today will be harder than it was in 1946, when military spending could be sharply reduced. Although there are military expenses to reduce as operations in Iraq and Afghanistan wind down, Medicare, Medicaid and Social Security make up a significant part of spending today and will be politically hard to cut. The other option of increasing tax revenues is also not popular and could slow economic growth. To bring the budget back into balance, some combination of entitlement cuts and revenue increases will be required.

The Atlanta asset management team at Brightworth states, "Given the political challenges of cutting entitlements and raising taxes in an election year, most politicians would prefer to reduce the debt to GDP ratio through economic growth and inflation." Inflation rose to nearly 4 percent in late 2011. While it may drop in the near term, inflation will likely be higher in coming years as the U.S. government looks to reduce its overall debt.

U.S. economic growth will probably remain modest, but could be stronger than expected if bold tax reform and economic growth policies are implemented. As the decade following World War II showed, modest economic growth and moderate inflation can significantly reduce the debt to GDP ratio if we can reign in deficits.

For more information on Atlanta investment management, visit http://www.brightworth.com.

About Brightworth:

Brightworth is a "fee-only" Atlanta wealth management firm. The Atlanta financial planners at Brightworth have a deep expertise across the financial disciplines to provide ongoing advice and coordinated leadership. Brightworth portfolios are built with a global capital markets perspective that includes the use of alternative investments to capture returns and reduce volatility as markets shift. With a policy of accountability and transparency, this Atlanta asset management firm is built to last with a succession plan designed for Brightworth to operate independently for generations.

For more information, visit http://www.brightworth.com

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Peliculas Online

Pose Retirement Questions to a Financial Planner

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You can pose your retirement questions to a certified financial planner for free on Wednesday, during two hourlong online sessions run by the National Association of Personal Financial Advisors and Kiplinger.

During the two Web sessions — at 10 a.m. Eastern time, and at 1 p.m. — you can ask your questions and have them answered by a member of the financial advisers group. Members of the association are fee-only financial advisers, meaning they earn fees from their clients only, rather than earning commissions from selling investments or other products.

The event is the second in a series. A transcript of the questions and answers from the previous session in October is available at Kiplinger’s Web site.

To participate, you can visit the Facebook pages of either the association or Kiplinger.

(You can also read questions and answers or submit questions via the association’s or Kiplinger’s Twitter handles, using the #JumpStartRetire hashtag).

If you miss Wednesday’s session, you can try again at another session on Dec. 14.

Kiplinger and the association will also run two day-long “Jump Start Your Retirement Plan” sessions on Jan. 12 and 17.

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Peliculas Online

Bucks: Resolution: Resign as Family Chief Financial Officer

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I got married in 2010 to a law student. We entered the marriage with different financial circumstances: I’d been working for a few years, paying taxes, saving for retirement and building credit. He was in school, focused primarily on covering his tuition. So when we merged our finances, it made sense based on our differing positions (and my fascination with personal finance) that I would continue to manage the money for us both.

This year, however, my husband graduated, passed the bar and is now planning his re-entry into the work force. And I’m welcoming the change as an opportunity to step back from being the main one in charge of our finances.

Pulling this off poses a few challenges, though. First, there is the technical. Online accounts for retirement savings, credit cards, etc. are intended to be accessed by one person only, so we’ve had to research ways to keep my usernames and passwords secure but allow my husband to find them.

Then there’s an educational hurdle. Although I’ve tried to keep my husband in the loop about the various moves I’ve made with our money, his easygoing nature and absolute trust in my judgment has meant that he doesn’t scrutinize our options. Looking at interest rate tables and reading prospectuses is more my thing. So now my husband is tasked with learning everything from what day of the month our utilities are due to which expenses can be paid out of our health savings account.

The rewards of this project will make the effort worthwhile, in terms of the benefit to our bottom line and our relationship.  Sharing these responsibilities will serve as checks and balances for everything from paying bills on time and watching our budget to tweaking our investment portfolio. His lower tolerance for risk and preference to keep cash will be a welcome balance to my gain-chasing impulses.

Most of all, I’m looking forward to knowing we’re equal partners in making choices about our future.

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Peliculas Online

How to Check Out a Financial Adviser

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That’s surely on the minds of thousands of clients of firms like UBS Financial Services, which is embroiled in a recent trading scandal, and Bank of America Merrill Lynch, which is suffering myriad financial woes.

If you’re concerned about whether an adviser’s parent firm is going to survive a crisis or if you’re not happy with your portfolio, there are some important questions to ask before you make a change to a new wealth manager.

Brand reputation is often the linchpin for advisory relationships. You should expect a wide range of services and extensive handholding from a top-tier firm. But when the company is tarnished, top executives and advisers often resign or are fired.

Take UBS, the Swiss bank that was once one of the most powerful brands in wealth management. At one point before the 2008 financial crisis, it employed 8,000 advisers. It was one of the largest managers of private wealth, with $1.7 trillion in client assets. Since the crisis, the firm has lost more than 1,000 advisers.

After it was revealed that a UBS trader had lost $2.3 billion from unauthorized trading, the company’s chief executive, Oswald Grübel, and other managers resigned.

If you are with a troubled firm, how do you know whether or when to move on?

The financial advisory industry is going through climactic change. The Securities and Exchange Commission is writing a rule that will make brokers and advisers become fiduciaries. This means that if they don’t put your interests first, you can sue them, which is not the case with most securities brokers and agents now, as they are governed by a looser standard of whether an investment they recommend is “suitable.”

“Don’t think that brand names are important when the industry is going through a paradigm shift,” says Paula Hogan, a certified financial planner (C.F.P.) and chartered financial analyst (C.F.A.) who is based in Milwaukee. People do not care as much about portfolio returns as they do about maintaining a standard of living for a lifetime, she said, and many high-visibility firms focus more on returns and less on comprehensive financial planning.

Finding an adviser who already acts as a fiduciary — while not a fail-safe standard — offers better investor protection than the broker-dealer model.

Generally, most fee-only C.F.P.’s, C.F.A.’s, lawyers and accountants who do personal financial advising have a written standard of care that combines a code of ethics with extensive pro-client guidelines.

Fees also provide an insight into the relationship you will have with a firm. Do they charge for assets under management or an hourly rate for planning services, or both? Do they earn a commission on their recommendations?

“Where does your adviser get their compensation from?” Mr. Hogan asks. “Do they own another business that benefits from their recommendations to you, or does the business own them?”

Don Trone, a fiduciary consultant with 3Ethos in Mystic, Conn., said he looked at credentials carefully. He favors C.F.A.’s because of their rigorous training in investment analysis, as well as those who are constantly updating their knowledge “through a commitment to lifelong learning.”

In addition to preparing an investment policy statement outlining your financial goals and risk tolerance, a worthy adviser must have the ability to listen, Mr. Trone said.

“They should adopt a consultative approach,” he said. “They should sit down and listen to you and write on a legal pad your goals and objectives. I like the 70/30 rule. You should do at least 70 percent of the talking and not vice versa.”

Yet even if an adviser is a great listener, the bedside manner can often cover some huge problems. Just ask the victims of Bernie Madoff. The next level of your inquiry can get at some of the most troublesome conflicts.

Stephen Horan, head of private wealth management for the CFA Institute in Charlottesville, Va., which represents chartered financial analysts, says it would be worthwhile to ask for an adviser’s Security and Exchange Commission’s ADV Form, Part II. This document is supposed to list any potential conflicts of interest and specify how advisers are compensated.

While you may grimace at the thought of poring through a disclosure form, you will learn if the adviser is paid referral fees by financial product firms, information about their transaction costs and where they hold your assets. This last item is critical. Ideally, your money should not be held by the adviser’s firm. You need a trusted third party holding your cash.

Several specialized search engines will check for disciplinary or legal actions and summarize the firm’s record. While it is not possible to know everything about an adviser, you can also learn a lot by how much attention they pay to ethical codes and adherence to tougher global guidelines, including the Global Investment Performance Standards, industrywide ethical benchmarks recognized in 32 countries.

“The world’s imperfect, and you can’t hold an adviser to impossible standards,” Mr. Horan says. “But a code of ethics and standard of practice is important. Just because a broker’s background check comes up clean doesn’t mean it’s a seal of approval.”

Ultimately, finding the right wealth manager goes beyond what the firm can bring to the table. They need to make the time investment in you and your objectives, and you need to complement the process by asking the right questions before engaging with them.

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