The Importance of Working with a Financial PlannerMost of us realize the importance of financial planning. We know that we should provide for our families in the event that something happens to jeopardize our financial well-being. We may want to leave a legacy for our families and for those less blessed than we are. We may want to ensure that our favorite charity continues providing services in the future and that our alma mater continues to carry out its mission of educating our citizens. But life gets in the way of making that happen. Caring and providing for our families is as important as our profession. The pleasure and fulfillment we get from our chosen pastime or helping with our favorite charity makes our lives meaningful. So making or taking the time to work with a financial planner to provide for our families can be a challenge but it is important.

The professionals at REDW Stanley can help by organizing, streamlining and tracking a person’s financial matters and providing a roadmap to help them achieve their financial goals. Putting all financial information in one place in a systematized manner as well as explaining how all of their financial issues work together can provide peace of mind to clients who know they need to organize their financial matters, but have no idea how to make that happen. Having all financial matters organized can also provide the opportunity to determine whether or not all assets are titled properly to take advantage of that Trust drawn up years ago, if a mortgage should be refinanced at a lower rate, if there is an alternate life insurance policy available at a lower cost, or if tax planning should be done to minimize taxes.

People who work with financial planners have identified what is important in their lives, have prioritized their goals, and are working toward these goals. As we begin working with our clients, we help them articulate what their goals are: traveling to those places on their bucket list, spending more time with their family, leaving money to their children, having enough money to retire at a specific age, not outliving their money, establishing a college fund for their children or grandchildren, leaving money to a charity, etc. Once those goals are established with a strategy to achieve them, our clients can go about their lives, doing the things that give them pleasure, with the knowledge that they do have a plan in place to achieve their goals.

Financial planners can help their clients reach large, seemingly impossible goals by establishing smaller goals that can be achieved through routine and persistence. Saving enough dollars over a 20-, 30- or 40-year time period for retirement, for travel or for a legacy to leave to a charity can be overwhelming. But having a small amount deducted from every paycheck and achieving close to market returns can result in the accumulation of a large dollar amount that might once have seemed impossible.

It is much easier to be disciplined about saving when a goal is established, such as having the dollars needed to send your children to college. Financial planners help clients identify their goals, put a financial value on those goals, and break those goals down into smaller, more achievable goals. By going through this disciplined process and maintaining an established strategy, the likelihood of achieving established financial goals can be improved significantly. A financial planner can be the angel on a client’s shoulder that says, “Save for little Susie’s college and for your retirement,” rather than the devil on the other shoulder that says, “You don’t really need to save now for those long term goals, but you really do need that second home right now.”

Investing to achieve an established goal should be treated as one more expense in a client’s life. Beginning as early as possible, investing on a regular schedule in a diversified portfolio and achieving a reasonable rate of return can be the difference between whether you achieve your financial goals or not.

Designing an organized, diversified portfolio that matches a client’s risk tolerance and being a buffer between making a logical, long term investing decision or an emotional, client-driven one can add value to a client’s finances. There are numerous studies detailing the very typical human response to a falling market, which is to panic and sell at the market low and then to delay returning to the market after most of the losses have been erased. A basic premise of REDW Stanley’s investing philosophy is to design a portfolio for each client that lies on the Efficient Frontier. Or put another way, to design a portfolio that matches the client’s individual risk tolerance to the appropriate projected rate of return. Combining different asset classes that are not correlated to each other provides a portfolio that produces smoother returns than making a bet on the best performing asset class in a single year, and has the probability of producing higher returns over an investor’s time frame. Portfolios that produce large annual losses generally have a smaller ending value than a portfolio that combines lower performing investments producing a steadier rate of return over the same time period. Remember that the tortoise won the race, not the hare.

Financial plans can be simple or complex and should be

Capital ConversationsMARCH 2013

Continued...Copyright 2013 REDW Stanley Financial Advisors, LLC. All Rights Reserved. This publication is intended for general informational purposes only.

The information contained does not constitute legal fi nancial, accounting or other professional advice.

Capital Conversationscustomized to meet the specific goals and objectives of each individual client. The cost of a financial plan is determined by those goals and objectives and by the simplicity or complexity of the plan and the client’s own financial position. Financial planners work with their clients to determine the price of a plan prior to beginning the plan. The cost can be calculated per plan with a separate price for an estate plan, a retirement plan, a college funding plan, an insurance plan or a retirement plan. Alternatively, the cost can be priced as a total cost for all plans provided. REDW Stanley can calculate the cost of a plan using either method, so it is important that both parties agree upon the cost of the plan to be provided.

Financial planners can assist their clients in many ways. This is a short and by no means exhaustive list of all the additional ways a financial planner can assist their clients: identifying estate tax matters; addressing the needs of a disabled child or family member after the primary care giver is deceased; gift planning to benefit that favorite charity; planning to pass assets in a tax-efficient manner to heirs; assisting with the myriad concerns (financial, legal and personal) associated with a divorce; determining the benefits of long-term care and disability insurance; assisting the surviving spouse and children after the unexpected death of a spouse or parent; and providing an impartial, objective point of view when needed. A well-educated, caring, ethical financial planner can provide answers to financial questions that are in the best interest of the client.

The financial planning professionals of REDW Stanley are those well-educated, caring, ethical financial planners who look forward to assisting our clients in achieving their financial goals.

By Laura Hall, CIMA®, AIF® Portfolio Manager/

Chief Trading and Operations Officer

1. REDW LLC has partnered with The Network, Inc., a leading national provider of hotlines, to provide a new fraud hotline service for organizations across all industries. From privately held businesses and government agencies to tribal and nonprofit organizations, subscribers will be able to join the REDW Compliance and Fraud Hotline to gain access to a 24/7/365 telephone hotline where employees can report fraud, waste and abuse, regulatory compliance violations, and many other types of financial offenses, including theft, falsification of records, conflicts of interest, unauthorized discounts, and kickbacks. REDW secured the ability to provide the service under its brand in order to help organizations, REDW clients and non-clients alike, strengthen their fraud deterrence programs.

2. Economic section: As investors look back on 2012, they should remember the resiliency of the markets in the face of macroeconomic and geopolitical uncertainties. Despite the many risks, the Dow advanced 7.26 percent, the S&P 500 was up 13.41percent, and the NASDAQ increased 15.91 percent, rewarding investors who had the emotional fortitude to remain invested according to their risk tolerance and ignore the short term “noise.”

3. Client section: A client of ours, a husband and wife, recently returned from a medical mission trip to Guatemala sponsored by Faith in Practice, where he, a doctor, performed surgery and she served as the official photographer/blogger for the group. If you are interested in their story, click on http://faithinpractice.org/blogs-and-media/photos/344.

Did You Know?Did You Know?

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