Saturday, February 14, 2009

You are not alone in dread of opening financial statements

Published Thursday February 12 in The Williamson Herald

By Tom Grimm, columnist

Do you have a stack of unopened financial statements sitting on a counter somewhere? And even though you know you should take a look at them, you haven’t.

Amazingly, for most of us this feels strangely familiar. As you know, you are not alone in your concerns about your finances. This is, in many ways an unprecedented time we are living in. We do not have a magic ball that is going to tell us the future, but there are still some sound principles that do work, despite a dwindling market economy. However, in this downward market, it is now more important than ever to not ignore your financial situation. It doesn't matter how much money you have tucked away in your personal financial portfolio, if you have a stack of financial statements, then you need to know and understand what is in them. Every effective financial plan must have a strategy, and no where in the laws of economics can you find a spelled out strategy for burying your head in the sand. So, here are a few first steps to offering you a helping hand to get your head out of the sand, and making your way to being financially empowered and knowledgeable about what you need to be doing to protect your retirement and life’s savings.

Before you can make sense of your statements, you need a plan. And every plan needs a checklist. Here are a few questions to ask yourself and your current financial advisor as you begin to sort through your financial situation.

Financial Checklist:
1. Do you meet face to face with your financial advisor? If not pick up the phone today and call them and request a face-to-face meeting with them. Bring a list of questions to the meeting. The industry standard is to meet at least once a year and/or on a quarterly basis if necessary.
2. Communicate your concerns with your advisor and make sure you are comfortable with the advice you are being given.
3. Open your statements every month, review them and examine them.
4. Consider your age and your tolerance of risk.
5. Make sure your advisor is not a salesman but a strategist keeping your best interest in mind.
6. Read the newspapers and keep current with financial news.
7. Get a second opinion and make a change if you are not happy with the service you are being given? Though it may not seem like a good time to change advisors ask yourself when would be a better time? Even though finding a new advisor can take time and be difficult don’t wait if you aren’t being serviced professionally.
8. Ask your financial advisor if your portfolio is suitable and well diversified, and then ask them to explain to you how they came to the decision of your current plan.

As an advisor myself I must say that hiding when times are bad is never a good strategy and the more contact I have with clients the more confidence we both feel that they are properly invested and aware of what is going on. Communicating with your financial advisor is key. Even in this current market, not all investments are doomed. There are still a few safer-havens out there and it is the job of your financial advisor to be looking for them and finding them for you.

What every advisor should be offering for their clients is a well-diversified strategy. Remember, communicate, ask questions about your portfolio, and stay in contact with whoever is managing your money.

So, open those financial statements, call your advisor, and commit to re-evaluate your current positions and strategy. We’re all in this together and the old saying is true that “every adversity carries a seed of equal or greater opportunity.” Good luck and remember your life is much more than what you can see on a financial statement.

Tom Grimm is a financial advisor and investment consultant in Franklin. Contact him at 467-6368 or

Posted on: 2/12/2009

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