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Incorporating “You” Into Your Investments

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Who are you, and what is your money about? Decades ago, the universe of investment choices for main street savers was much more limited. Thanks to technology and innovation, you now have tens of thousands of options from which to choose. The challenge is to winnow down the options to those that fit you best. Even world-class investments won’t do, if they don’t align with your personal tastes and unique financial circumstances. The following five factors are a few of the considerations we evaluate when designing portfolio allocations.

Personal Circumstances and Goals

There are any number of details that might influence the specific selections we’d recommend for your evidence-based portfolio. How long do you have to invest toward your various goals? What are your cash flow wants and needs? Are you a business owner? What are your legacy plans? These and other fundamentals can influence not only how we structure your investment accounts, but which specific holdings to tilt toward or away from.

Risk Tolerances

Are you comfortable taking big risks in pursuit of greater rewards? Maybe you even thrive on the bleeding edge of the latest investment innovations—such as potential new investment factors, alternative markets beyond stocks and bonds, cryptocurrency, and other blockchain-related investment vehicles. Conversely, you may prefer only the most tried-and-true solutions, with decades of dependable performance data on record. Your portfolio can be tailored in either direction.

Taxable Tradeoffs for Existing Wealth 

Most investors arrive with existing investments—good, bad, and everything in-between. In pursuit of perfection, we must carefully account for the costs of transitioning toward a more cohesive portfolio. This includes accounting for the “space” in your existing, tax-sheltered accounts, as well as the tax ramifications of selling less desirable taxable positions. Upfront and ongoing, we perform cost/benefit analyses to identify when our preferred investment selections should be in your best interest, and when tradeoffs may have to do.

Ideal Allocations when Faced with Limited Options

Most employer-sponsored retirement plans offer only a limited number of investment selections. Even if your company retirement plan doesn’t offer ideal selections, it may still be among your best, most tax-wise investment vehicles—especially if your employer is matching your contributions. After all, free money is hard to beat. For the income you’re directing to your retirement plan, you must make the best selections available to you and fill in the resulting gaps in your household allocation with assets outside of the employer’s plan.

Sustainable Investing

Do you want to incorporate an “ESG” (Environmental, Social, Governance) or similar values-based element in your investing? The right solutions for you depend on where your priorities fall.

Each of these items helps you view your allocation from the high-level view. The next step is to go micro and evaluate each individual fund on its unique merit. If we can help you by crafting an ideal allocation tailored specifically for you, please let us know.

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