life goals

Letters to our Children #4: Create Your Own Adventure

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Narratives, or stories, are how we understand the world and our place in it. They may play a powerful role in helping you form and reach your major aims. For example, my own narrative about working to age 92 has given our enterprise a vitality and dynamism that those coasting toward retirement may lack—among other benefits.

While your story is highly personal and unique, we often see these three patterns:

1. Younger clients are often aiming at building financial security, establishing homes and careers, within the longer term goal of becoming financially independent.
2. Some of our clients are retirees whose narratives involve being a good steward of their wealth, enjoying life by living modestly but well, and aiming at leaving a legacy to succeeding generations.
3. Others are more focused on travel or other things that were not possible during their working years, and having the cash flow to comfortably support those things.

The foundation of your narrative is your core principles, or what you are trying to do with your life. When your story connects with the most fundamental thing about you, it may be more likely to become true. What are the three most important things in your life?

Where and how do you want to live? What role will family play in your activities? How will you spend your time? Will you work at something you enjoy for pleasure in later years? Is entrepreneurship in your future?

You do yourself a big favor when you realize that life is your own adventure. You can create it.

Sometimes your story has to change because life happens. One chapter ends and a new one begins. We are almost never done with new chapters and new stories. Resiliency and adaptability, making the most of what you have to work with, are useful additions to any story.

Clients, if you would like to talk about your story or anything else, please email us or call.

Letters To Our Children #3: The Outlines of Planning

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The object of planning is to figure out your primary aim or goals in life, and what you need to do to get there. The habit of rethinking these things from time to time and assessing your progress keeps you on track.

It is helpful to think in terms of narrative – stories – that describe what you are thinking about. For example, if your story involves retiring to a home in the mountains, your life between now and then will be shaped by that goal. You might vacation in your intended destination, get a feel for the lifestyle, the real estate market, activities, how your life might look in retirement. The narrative may motivate you to do what you need to do to make it a reality some day.

No matter how distant your goal, you’ll be better off if you know how much wealth you might need to get where you want to go. So there is some arithmetic and financial planning to do.

Getting down to details, we think there are several broad categories that need attention in a comprehensive plan. People are better off when they think about and manage:

• Human capital, or earning power, and careers.
• Investing wisely, managing financial assets.
• Spending well, managing the budget and liabilities.
• Residential plans, where do you want to wake up every day?
• Educational funding plans for children or other relatives.
• Retirement intentions.
• Exposures to loss.

In subsequent letters, we will get down to details in each of these areas. Clients, if you would like to talk about this or anything else, please email us or call.


Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.

Directing Positive Change

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We humans are not perfect, have you noticed? Many of us have aspects we would like to improve in order to make life better.

In his book Atomic Habits, James Clear illustrates three layers of behavior change. We may seek to change an outcome, or the process to get that outcome, or our identity. Let me explain.

The outcome is the obvious thing, what we want to end up with. I’m reminded of comedian Steve Martin’s advice on how to become a millionaire. “First, get a million dollars.” Lose weight, get a degree, or get in shape are other examples of outcomes.

The process or systems you use to get to a desired outcome are a better focus for our efforts to change. If your goal is financial independence, you might begin contributing to a retirement plan, start a Roth IRA, begin a monthly automatic deposit to a savings account, find ways to earn more money, or monitor your expenses more carefully.

It seems like a process orientation – how we get to our desired outcomes – is a better place to focus than on the outcomes. But there may be a more powerful layer to effect change.

A recent news story indicated that a large fraction of pre-retirees believe they will struggle financially in retirement. If part of one’s identity is they will end up broke, it may be difficult to make process improvements stick. “What’s the use, if I am going to end up broke anyway?”

If identity becomes “I am a person who will always be able to get along financially,” then doing the things that are necessary to make that true become easier, if not automatic. But can our identities be changed?

James Clear says that what we do affects what we believe about ourselves, our identity, just as our identity affects what we do. So taking those steps to improve our processes, combined with a thoughtful approach to what we want to become, may actually shape our identity over time.

Consider the difference between “I’m trying to quit smoking” and “I don’t smoke anymore.” The first version is from a person who still identifies as a smoker. The second version is from someone who believes that smoking is now a part of their past, not their present identity. You know which one is a more effective way to look at it.

Clients, if you would like to talk about this or anything else, please email us or call.


The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

Moving Target

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We have observed that spending in retirement is a moving target. One theory says we spend more money in the early years of retirement than in the later years. Financial planner Michael Stein describes it this way: the Go-Go years, the Slow-Go years, and the No-Go years.

Spending in retirement impacts some of our most fundamental plans and planning. Retirees have a wide range of lifestyles, avocations, and circumstances which take money. It’s a personal thing.

In our experience we see people spend less as they age. When we first noticed this trend, we wondered if that was because some people run low on money. However, we recently have taken note that people with resources tend to spend less as time goes on. (Health expenses may run counter to this trend, increasing toward the end of life).

Each person has their own objectives and habits, and life throws some curve balls too. Case by case, it could make sense to plan on spending more in the early years of retirement. Bucket list items, to be done once, might come early in retirement.

The Alaska cruise, trip to Hawaii, or tour of Europe should be undertaken when you have the time and money and health to do it. The boat or camper, if one is desired, should be purchased when one has more years to enjoy it.

One of the most gratifying parts of our work is working with people on their plans and planning. We’ve worked with some of you from mid-career all the way into many years of retirement. Each one of you is as different as a fingerprint.

Clients, if you would like to talk in more detail about your retirement aspirations or anything else, please email us or call.


The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

 

The Meaning of Life

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If you ask Google “What is the meaning of life?” you’ll have more than 25 million search results from which to choose. We cannot answer the question for you, but the question and its answer influence your plans and planning.

Whether we think about “the meaning of life” or not, each one of us has fundamental values and principles that shape our words and deeds and lives. If we are to rely on one another, we probably need some common ground on these values and principles.

We say this because strategy and tactics in planning and investing arise out of our values and principles. If there is some agreement on values and principles, then our strategies and tactics will likely make sense to everyone involved. But if we have completely different ways of looking at the world, then we would probably have different ideas about strategies to deal with opportunities and risks as they arise.

We work with a diverse clientele, people from all walks of life in every kind of circumstance, across the country. You have your hopes and dreams; our object is to understand them, and figure out what role we might play in making them more likely to happen. You may understand ‘the meaning of life,’ or perhaps like us you’ve concluded that life is a journey on the road to understanding. Either way, aren’t we all trying to make sense of it?

Whatever one might think about the meaning of life, it is certain to be better if we listen to one another, respect the intentions and plans of the thoughtful people around us, and help each other get where we are trying to go.

Although it may not look like it, that last sentence is our business plan. It isn’t like the ones you might find in a business school textbook. There aren’t any numbers or growth objectives or profit goals. Simply put, the better off our clients are, the better off we are likely to be.

That has meaning in terms of the resources we need to serve you, personnel and training and equipment and facilities. It shapes how we spend our time, researching markets and managing portfolios and talking to you and communicating in other ways. And it is a big factor in making our practice sustainable.

What is your fondest wish? What are your major objectives? What is the meaning of life? If you’d like someone to listen to your answers, please write or call. It’s what we do.

Fruition, What a Wonderful Word!

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We’re inspired by recent conversations with clients and friends whose plans, as they say, have come to fruition. Fruition—the realization or fulfillment of a plan or project—scarcely begins to describe the satisfaction and joy we’ve seen.

The recent retirees after downsizing to a maintenance-free home, going to art festivals instead of pulling weeds, having more dinners with their descendants, seeing more ball games… people going on that Alaska cruise or the tour of Italy… hobbies becoming true avocations. These are some of the plans we’ve seen come to fruition for people we are close to.

A wise person once said that a plan is a dream put into writing. We are in the business of trying to make the arithmetic work for people who would like to try to make their dreams come true. We’ve written before about the best way to retire and the point is, dreams are personal. What are you trying to do? Where do you want to wind up?

One of the privileges of long experience in our work is seeing the realization or fulfillment of plans made long ago. But life sometimes throws curve balls. So we’ve also seen adaptations and adjustments made by people who would have preferred to avoid the need for adjustments. Not everyone we love lives as long as we wished, health may be fleeting, and circumstances often present a mixed bag. The point is, sound plans usually put us in better shape to deal with the unanticipated.

Money is not the most important thing in the world. But it is also true that resources give us options we might otherwise not have. Wealth may free up our time, and time is what life is made of. Dreams and arithmetic working together may make the best things more likely. If you would like to discuss your dreams and plans in greater detail, please write or call.

A Time to Reflect

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These are exciting times. With a birthday approaching, I am halfway to 120 years old. It is a natural place to stop and reflect on the journey so far, and the path ahead.

Twenty years ago, I was planning the concept that turned into Leibman Financial Services. At its heart, the idea was to build a business whose success depends entirely on the success of clients. After two prior decades of working with money in most of its forms, the experience and preparation were in place. The interest and passion was there. All we needed was people who would entrust us with their hard-earned wealth and well-thought plans.

Then you showed up. Thank you. The work is gratifying beyond words. And that leads to the next topic, the path ahead.

I plan to work to age 92. Two of my oldest friends, now gone, worked to that age in their own businesses. They were vibrant and active and happy in their later years, a good model for me.

It is amazing how a cherished objective can shape your actions and choices. I often say it is almost embarrassing to be learning so much at such an advanced age. But this is just lame humor. The need to keep learning and adapting and to stay current with developments in the economy and the markets and the business, and to get the resources and people in place to serve your needs, and the constant search for investment opportunities…all of this is invigorating. I feel like I discovered the Fountain of Youth.

The future is not guaranteed to us, in any sense. We can plan a big retirement party for the year 2048 when I turn 92. But we can’t know that any one of us will be there. So we would also like to extend another invitation, for something a little sooner.

If you would like to have breakfast with me at B’s Diner in Louisville, or lunch at the Main Street Café, just call the shop. We are scheduling through mid-July, so there are plenty of slots. The coffee’s always on, too, so if another time would suit you better, we can do that. Thank you all, so much, for the decades–past and future.

Feelings, Numbers, and Big Decisions

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Life comes with many questions, infinite in variety. Should I buy a different home, live somewhere else, go back to school, retire in the sun, spend time differently, have more children, get a dog, buy a second home, invest in solar panels, change careers, take Social Security now?

Feelings are vital to making good decisions about your life and plans. So are numbers. But using one in place of the other may lead to terrible outcomes.

“Know yourself.” Some wise person advised this back in the dawn of history, and it is the foundation of great decision-making. What do you want? Where are you going? Where do you want to wake up every day? What are you trying to accomplish in life?

Notice that numbers do not really enter into these things: this is the next step, when we do all the arithmetic there is to do. If we quantify everything that can be put into numbers, we will have a much easier time in actually making choices and decisions.

For example, one might have feelings about whether to start Social Security earlier or later. You may believe that if you claim benefits at the earliest age, you will be better off because you will ultimately collect a greater number of monthly payments. On the other hand, you may think that if you defer until later, you will be better off because each payment will be higher. These are feelings.

But when we do the arithmetic, we might discover that there is a break-even point out there that applies to you at a certain age. If you live longer, the numbers say deferring benefits is a better option. If you pass away sooner, you would have come out best by taking benefits early. Figuring out which option works best at what age is arithmetic.

Here’s an interesting thing about this decision: nobody knows the date that is going on their death certificate, so numbers cannot PROVE which choice is better. We won’t know until we find out. But obviously, numbers do help us better understand the meaning and consequences of our feelings.
We figure out what we want with our feelings. We learn everything we can learn from the numbers. We use both to arrive at a thoughtful, knowledgeable decision.

When people make decisions without any numbers or with nothing but numbers, sometimes it does not work out. “We deserve a large new home, so we are buying one,” or “Our taxes would be lower if we moved to another state in retirement, so we are moving.” Sure, you bet—but in each case, do the numbers work with all of your other goals and priorities and feelings?

We do our best to understand your feelings, your goals, your objectives, what you are trying to do in life. And we add all the pertinent numbers, in terms you can work with, so that you can make good decisions. Feelings and numbers: both are vital. Call or email us if we can help you sort things out.


The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.