From time to time we come across lists and articles on investing. And we’ve taken a few of the items we’ve seen over the years and written a little commentary based on how we serve you.

A year from now, you plan to own similar investments.

We believe ‘winning’ in the market begins with understanding ‘why’ you are allocated as you are.  Timing and changing strategies rarely produce the long term results investors need to fund their retirements.  Sticking with an allocation that is rebalanced and invested with purpose is the best way to ‘Win’ in retirement.

You’re so well-diversified that you always own at least one disappointing investment.

This is probably one of the hardest lessons in investing and represents the value in diversification.  A properly diversified portfolio is always going to have some asset classes (i.e. investments) out of favor with others being the bright spots.  The key is to own them both since timing them consistently is impossible.

When the stock market is volatile, or even decreasing, you are not uncomfortable.

You realize that the stock market is volatile and the temporary declines of 14% inter-year and greater than 20% every 5 years are normal. That’s precisely why stocks return more over the long term than other less volatile investments.

For every dollar you’ve saved, you have an eventual use in mind — and you are invested accordingly.

Dollars that you have saved, but aren’t needed for many years in the future, should be invested accordingly.  The dollars needed soon should be in less volatile (i.e. lower return) investments.  However, don’t shortchange your resources the ability to outpace inflation when they are needed far into the future.

You can remember the last time you rebalanced.

Well, you might not be able to recall if you have, but the good news is that as a client of GuideStream Financial, you have your portfolio(s) rebalanced at least annually.  We help you stay true to your long term investment and retirement objectives.

You never say to yourself, “Wow, I didn’t expect that.”

This is our goal.  Through preparation and education, you understand that year to year, your portfolio will fluctuate depending on contributions, withdrawals and returns – but that in the end, you have a good working knowledge of how your cash flow will work over time.  We know you don’t like surprises and neither do we.  Some years, things may be fruitful and other years they may not be. What’s most important is that we both know the long term goals and that is where we focus.

We appreciate your continued trust and are honored to assist you on your stewardship journey. 

The Importance of Having A Will

According to a 2014 survey, 51 percent of Americans age 55-64 (and 62 percent of Americans age 45-54) don’t have a will. The reasons for not maintaining a will can range from a lack of urgency to a paralyzing fear of death. Not only is having a will necessary, the effects of dying without having a will—called dying “intestate”—may be worse than you expect.

The Dangers of Dying Intestate
Estate Shrinkage
It is normal for estates to lose some of their value to final costs, such as burial/funeral expenses and outstanding debts. However, lengthy court procedures and legal fees attributed to resolving inheritance disbursement can quickly erode a large part of an estate’s net worth. Wills are created for the benefit of survivors; not having one reduces the amount that passes to the heirs.

Family Disputes and Disagreements
Disagreements regarding an estate can easily cause rifts in families. Arguments over who deserves specific heirlooms or property can be exacerbated when the wishes of the decedent are not directly known. In extreme circumstances, these kinds of disputes can last for decades, making a will essential—especially when families are large or relationships are strained.

Drafting a Will
Inexpensive and Quick Process
Creating a will is not expensive, with some estimates putting the cost at just a few hundred dollars if done through a lawyer. Additionally, there are legal websites that allow individuals to draft their own wills at a fraction of that cost. Whichever method is used, creating a will typically takes less time to complete than most people think.

Benefits of a Will
Control over Assets
The decedent may have specific desires regarding which of their family members get their possessions. Instead of the distribution of assets being decided by another family member or possibly the legal system, having a will allows the decedent to fully control where all assets will be distributed.

Choose Executor of Will
If there is no will, and subsequently no executor named, the individual that is chosen by the probate court may not act according to the decedent’s desires. Choosing the executor of a will ensures that the individual that the decedent thinks will best serve his or her wishes will be in charge of key decisions, handling conflicts and proper care of 
the estate. 

Custody of Children
If the decedent has children, but has not named a new guardian in a will, the courts will decide who gets custody of their children. Although judges consider living situations and familial relations while trying to act in the best interest of children, they can’t possibly know every detail about each family’s unique situation and there is no guarantee that a court-appointed guardian will be the same person the decedent’s would have wanted.

Now is the Time
Peace of Mind
Thinking about death may be frightening, but the thought of leaving confusion, lack of clarity and potential disputes behind can be even more unsettling. Creating a will allows individuals to know that, when they pass away, all of their wishes will be honored and their loved ones will be free from the burden of figuring out the details of an estate.

Keep it Updated
If you already have a will, consider revisiting and, if necessary, updating it. There may have been financial, legal or personal life changes that are not yet reflected by the current version of your will. Not having a will can create confusion, but having an outdated will that gives rights to a former spouse or estranged family members can be disastrous for intended heirs.


Remember that past performance may not indicate future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, strategy, or product referenced directly or indirectly in this newsletter will be profitable, equal any corresponding historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. You should not assume that any information contained in this newsletter serves as the receipt of personalized investment advice. If a reader has questions regarding the applicability of any specific issue discussed to their individual situation, they are encouraged to consult with a professional adviser. 

This article was written by Advicent Solutions, an entity unrelated to Guidestream Financial, Inc.. The information contained in this article is not intended to be tax, investment, or legal advice, and it may not be relied on for the purpose of avoiding any tax penalties. Guidestream Financial, Inc. does not provide tax or legal advice. You are encouraged to consult with your tax advisor or attorney regarding specific tax issues. © 2014 Advicent Solutions. All rights reserved.

Financial Planning: Not Just for Men!

Financial Planning: Not Just for Men!

-by Debra Lyon, Caitlin Koppelman, and Lori Pelham-

Lisa is 35. She’s a mother to 2 beautiful children and a recent divorcee. She just returned to part time work last year when her youngest started school. Up until now, she’s largely left the management of family finances to her husband. Now that he’s her ex-husband, she’s faced with limited financial knowledge, heaped on top of an already stressful balance between work and family.

Lisa needs an advisor who knows her needs; someone she can trust completely. Someone who can clearly communicate financial principles to help her not only succeed, but grow in her financial literacy. In short, she needs a coach who can teach her and help her look out for her family’s financial future.

Susan is 72 and recently widowed. Her children are grown, and she’s pleased to say that she devoted her life to raising them well. She hasn’t worked since before the kids were born, and she’s always been thankful for her husband’s careful attention to their family finances. Now that he’s gone, she’s not sure who to turn to. She knows the basics of paying bills – her husband shared that much with her – but what about taxes? Long-term care needs? How does her husband’s death affect their estate plan?

­­­­Susan needs an advisor who recognizes her situation and knows the unique needs that come with it. The ideal advisor for Susan would be able to look at the whole picture of her financial situation – appreciate and honor what her husband has put in place – and help Susan move forward toward the future with confidence.

These are just two examples of women and their unique financial needs. Even if you’re currently married and/or part of a dual-income household, as a woman you have specific financial thoughts and convictions that may be different from your husband’s. While you’re working together toward a shared future, it’s important you continue to take an active role in the management of family finances.

Women are earning more and spending more than ever. They control more dollars in the US economy today than in any other time in history. Any financial advisor worth their fee should recognize this fact and (more importantly!) recognize the unique needs of the women in his/her client base.

Find yourself a financial coach. Maybe you already have one, but you don’t usually go to the annual review meetings with your spouse. We encourage you to go: build a relationship with your advisor. If you have shared finances, that coach should be looking out for you, too.

If you’re on your own, like Lisa or Susan, seek out the counsel of an advisor. If it helps, look for a woman whose professional opinion you trust. Even if her personal situation is different from yours, you still have some major things in common.

Don’t leave your financial future to chance. Find an advisor you can trust, a coach who can help you navigate the twists and turns of life. That relationship will prove fruitful now and in the future.  


The Cost of Biases

Behavioral finance—the interaction between human psychology and money—has become a major component of current economic theory. Experts on behavioral finance love to study how greed and fear cause massive swings in the markets.

But behavioral finance doesn’t just exist in academic theory and panicked stock crashes—it’s part of everyday life. The human brain isn’t a calculator and struggles to separate money from emotion. Every time we open our wallets, our financial biases and blind spots threaten to disrupt good decision-making.

Fortunately, biases become much easier fight once we learn to recognize them. Here are a few of the most common financial biases people face:

Bandwagon Effect

One of the strongest biases, the bandwagon effect is the tendency for people to change their opinion or behavior to match that of those around them. Bandwagons often create social pressures and can push people to spend far too much “keeping up with the Joneses.” Always evaluate your financial decisions on what works best for you, not what works best for others.

Familiarity Bias

Familiarity bias is when people show an irrational preference for something that they’ve used in the past. One common effect of this is default brand loyalty, which can hurt the efficiency of a budget or draw you into extra spending.  How many times have you bought a familiar product brand even when there is evidence another option might be better or cheaper? Give something new a try.

Ego Depletion

This bias is a kind of mental lapse. Self-discipline is difficult, and our brains can only do so much of it before taking a break. If we push ourselves too much, we often react strongly in the opposite direction. Ego depletion is what leads to shopping binges after you cut too much discretionary spending from your budget. Remember: rewarding yourself for progress is an investment in your goals.

Recent/Available Information Bias

When it comes to information, people are quick to embrace the new and forget the old. Information biases are responsible for many fads and false fears. For example, if you have two coworkers who were robbed in the past year, you may want to buy an expensive security system. Even if the thieves were caught and local crime rates are extremely low, your judgement is disproportionally affected by the information that is most recent and most available to you.

Survivorship Bias

This bias is the tendency to misinterpret a situation by focusing on the quality examples. It can be paraphrased as, “you only hear about the ones that make it big.” This bias is most dangerous to entrepreneurs or investors because it causes them to underestimate difficulties overestimate success. People should be brutally honest with themselves and consider the possibility of failure before investing their life savings in a business.

Zero-risk Bias

Humans love certainty; it eliminates risks and makes planning for the future much easier. We love it so much we’re often willing to pay more for extra peace of mind, even if it doesn’t make complete sense. For instance, people happily pay a lot of money for the reliability of a new car and then also buy the dealership’s short-term warranty to protect it against a breakdown. We know a new car is highly unlikely to have problems for a few years, but we still feel the need for added certainty.

Fighting for Financial Independence

In America, the idea of “independence” is almost sacred. Every July 4th, we celebrate the start of the United States’ long road towards independence and control of its own interests.

When people make plans for the future, many put “financial independence” as their ultimate goal. But much like national independence, financial independence— living without the need to work for someone else—takes years of struggle against huge challenges.

Here are some of the essential concepts to help you win your war for financial independence. Each one battletested and proven effective by that other great struggle for independence: the American Revolution.

Coordinate your attack – Winning a war takes success on all fronts. If you neglect a certain area of your finances, all your progress could be completely undermined. For instance, going to great lengths to secure higher income for yourself becomes pointless if it forces your expenses to grow even faster. Even though you are worth more, your net worth will decrease and it will take more time to reach your goal. Every part of your financial plan needs to work together to secure victory in the shortest amount of time. (Siege of Yorktown, 1781)

Seize opportunities to advance – Sometimes a great financial opportunity appears, but we are too nervous to take advantage of the situation. Although caution is useful, having the courage to commit to a solid investment can pay huge dividends in the future. Watch for financial opportunities, judge them rationally and make a bold move if everything looks good. (Battle of Saratoga, 1777)

You can lose a battle and still win the war – Both financial plans and military strategies must survive
setbacks and short-term problems on their way to a longterm goal. If generals completely changed their campaigns every time something went wrong, no army would ever accomplish its objectives. Don’t let temporary market downturns or sudden expenses cause you to panic or abandon your goals. Expect difficulties and learn to push through, even when things are disrupted. (Battle of Bunker Hill, 1775)

Keep your morale up – Staying disciplined with saving, planning and investing is difficult in even the best of times. But if your attitude turns negative, you’ll never be able to reach the level of independence you desire. When things get tough, try to focus on the future and how great things will be when you reach your goals. Don’t forget to regularly reward your efforts; it’s better to occasionally deviate from your plans than to get worn out and give up entirely. (Winter at Valley Forge, 1777-8)

Drill your actions – As with all things, practice makes permanent. Habits take time to develop, so keep trying to put your financial plans into practice. If you continually allow or encourage yourself to break your rules, you’ll be creating bad habits that could end up being costly. Training is about getting so comfortable with an action that you can perform it in the middle of chaos. (Baron von Steuben, 1730-1794)

Get creative – The most impressive victories are the ones that an enemy never saw coming. Traditional tactics can work well in most situations, but taking time to find an original approach to your goals can get you to financial independence faster and more efficiently than anyone expected. (Battle of Cowpens, 1781)

The fight for financial freedom takes hard work, discipline and sacrifice. It’s a war unlike anything else, but its values are nothing new. By understanding the challenge and adapting the lessons of the past, we can learn how to keep winning independence for the future.

Simple Fitness Truths

-By Mark Olson-

Why is it that most of us have a sincere desire to manage our health and finances to their highest potential but few have effectively cared for those critical aspects of life over the long haul?

Most of us will acknowledge the primary cause is that life is complex, and the urgent tends to crowd out the important.  Another contributing factor is that we are surrounded by, and vulnerable to, varieties of myths and traps that keep us from taking, and then staying on, that higher road.

One dominant health myth is that there is a magic diet or product that will allow us to be fit and maintain our target weight with a minimum amount of time or effort.  Six-pack abs in six weeks anyone?

The financial arena is loaded with illusions that financial security is an end-all or that a guru or scheme exists that can magically turn $100 into $1,000 virtually overnight.  The untimely death of a loved one can be a sobering reminder that financial security and blazing returns may not be so important after all.

So what is it that can help us rise above the complexities of life and do what is most important?

The missing link, that can make all the difference, is a goal-focused plan that flows out of our deepest convictions overseen by someone who can hold us accountable.  One of the first steps of getting there is to be quiet enough, long enough, to define those elements in life that matter most.  Spouses, coaches, pastors, advisers and friends can be invaluable along that path.

If your conviction is that you are a steward of the physical aspects of your life, your goal-focused health plan may be to maintain a target weight and exercise some minimum amount per week.  If so, your long-term success could be assured by simply eating less calories than your body expends, finding ways to exercise consistently with activities that bring you joy and engaging people to hold you accountable.

If your conviction is that you are a steward of the financial aspects of your life, your goal-focused financial plan may be to maintain giving and saving at some target level and living on the rest.  If so, your long-term success could be assured by giving to the people and causes you care about most, investing in a globally diversified portfolio with a target return that flows out of your plan and engaging with some type of coach to help you adhere to your plan until your needs change.

In health, as well as finance, I have found that the differentiating keys to success over the long haul are defining reasonable goals and maintaining consistency through an appropriately balanced pace.  It’s all about average speed over a lifespan; not maximum speed at any emotionally charged point in time.

See you on the journey.

“There is no shortcut to anywhere worth going.”  Beverly Sills

“Slow and steady wins the race.”  Robert Lloyd

“The glory of God is man fully functioning.  Find your place to do that, and you will find the peace that passes all understanding.”  Irenius

For Today’s Children, Retirement Planning Starts Young

We all hope for a long, healthy life, but—from a financial standpoint—the length of our lives may be starting to get out of hand. One projection from the U.K.’s Office of National Statistics estimates that more than 30 percent of the nation’s children born after 2011 will reach age 100. That means that for every couple that reaches age 65, more than half will have least one partner live another 35 years.

If today’s children continue to retire at what we currently consider a “normal” age, many could spend almost as much of their life in retirement as they spend working. Since a majority of U.S. citizens already face insecure retirements with current financial planning norms, extended longevity may become an overwhelming monetary challenge.

One solution to the problem may lie in changing when people begin to plan for retirement. A few extra years of growth can have a massive impact on the value of a retirement account. If we can train today’s children to make good financial decisions earlier in life than most adults do now, they’ll be better able to handle the cost of an extremely long retirement.

But it’s today’s adults who will need to teach them.

In general, adults usually impart their financial habits to children—whether they mean to or not. Kids are observant, and adults’ financial decisions can imprint upon them easily. However, retirement planning, though essential, is an obscure subject. Children get to see how adults spend their money, but they don’t often see how they save it.

Obviously, trying to lecture a young child about 401(k)s and investment strategies won’t be helpful to anyone, so adults will need to take a more basic approach. By teaching children the underlying principles of saving, planning and money growth, you can turn their future financial decisions into a matter of obvious choices.

Getting Kids to Learn
Though teaching financial habits takes more than a piggybank, it’s still a great place to start. Providing a younger child with both an allowance and savings goals is a great way for them to practice budgeting. Help the child set goals that are simple and attainable; if they set an ambitious goal, offer to help them by covering the difference if they reach a significant percentage of the total value.

But saving alone isn’t enough: children need to understand that value can grow over time. This can be taught by providing them with interest: offer a small amount of money for each dollar they saved from their last allowance. They’ll quickly learn that by forgoing some immediate gratification, they can reach their savings goals even faster.

Later on, you can reverse this process to teach a child about debt. Allow them to borrow money from you for a small purchase, but plainly explain that they’ll have to pay the money back with interest. When they hand their money over to you later, it becomes a golden opportunity to explain how debt means paying extra.

If you prefer a more direct route of education, there are numerous online resources to help teach kids about money and smart planning—one of the most interesting examples being Warren Buffett’s own online cartoon series “Secret Millionaires Club” (
As a child grows, help them get the ball rolling on retirement planning. Our team at GuideStream Financial would be glad to help them take some first steps. We can help you explain the importance of planning ahead for retirement and avoiding heavy credit debt (especially during college). Financial maturity doesn’t happen overnight, so stay patient and don’t try to cover everything all at once.
Remember that past performance may not indicate future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, strategy, or product referenced directly or indirectly in this newsletter will be profitable, equal any corresponding historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. You should not assume that any information contained in this newsletter serves as the receipt of personalized investment advice. If a reader has questions regarding the applicability of any specific issue discussed to their individual situation, they are encouraged to consult with a professional adviser. 

This article was written by Advicent Solutions, an entity unrelated to Guidestream Financial, Inc.. The information contained in this article is not intended to be tax, investment, or legal advice, and it may not be relied on for the purpose of avoiding any tax penalties. Guidestream Financial, Inc. does not provide tax or legal advice. You are encouraged to consult with your tax advisor or attorney regarding specific tax issues. © 2014 Advicent Solutions. All rights reserved.

Financial Planning

-By Scott Blakemore
What comes to mind when you think of “Financial Planning”? 

When asked what I do for a living, my response, “I’m a financial planner” is usually met with blank stares and the sound of crickets.  Now and then I get a response, “Oh, I’ve done that”, “I have an annuity,” or “I have an IRA”.  If only that was all it takes.

In the next few paragraphs, we’ll address three common perspectives regarding “Financial Planning” that many people share and how it affects their planning decisions.

I don’t understand enough to know where to begin.  We hear this one often (both from clients and potential clients).  They apologize for not knowing enough about their investments, pension plans, social security, health or insurance benefits. 

Here is the good news: planners realize you have likely never been taught, nor do you probably want to learn about all the components of your financial situation.  I don’t want to be a nurse or doctor, and when I go to the doctor, I don’t apologize for not knowing how to take my blood pressure.  I am not trained in this, and they don’t expect me to know.  I just want to know if my blood pressure is good or bad, and what to do to correct the problem.  The same is true for a financial planner – you don’t have to know it all, but you do need to know who can help.

Financial planning is inflexible and limiting.  Rarely does someone verbalize this concern, but when asked if they perceive this to be true, their eyes get wide and they nod their head in agreement.

How many Fortune 500 companies have business or marketing plans, sales forecasts, or budgets?  Probably all of them.  How many change their plans the following year?  Probably all of them.  Maybe they aren’t big wholesale changes, but as information comes in and circumstances change, they change.  The same is true for your financial plan – a good plan is flexible and changes over time as you do.

I have a 401k, IRA or Roth IRA.  I own an annuity, stock or bond.  I’m all set.  While various products and retirement plans are definitely components to be used appropriately when constructing a plan, they are not a financial plan in and of themselves.  Does owning a bat make you a baseball player or owning golf clubs make you a golfer?  Having the right equipment is important, but if you want to be successful, you need a coach – someone to teach you and help develop your skills.  The same is true for a financial planner, we will help you learn the game, coach you and use the appropriate tools.

At its root, financial planning is mostly about trust in the person helping you.  Remember, you aren’t required to understand everything, your plan can flex with you, and there’s much more to a financial plan than the components you use.  Find someone who will listen to you and help you ask the right questions … that is the best, first step toward a more solid financial future.

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