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Five Steps That Will Improve Your Balance Sheet in 2016

      Since New Years is a time to reflect and set goals for the upcoming year, I thought I would take the liberty of offering my suggestions that I think will make most every person better off than if they choose to ignore them.  None of these ideas is a recommendation of a particular investment strategy or place to be in the market, which goes to show that it’s not all just about market returns.  So, here they are:
     1.   Make Powers of Attorney.  Making a Will has to be the most procrastinated (if that’s a word) task in existence.  It’s possible, but not likely, that you can get through life without one and everything will turn out just fine.  The same is not true for Powers of Attorney.  If you have an accident or have the bad fortune to suffer from dementia or Alzheimers, your family will wind up paying thousands of dollars in attorney fees and spending time at the Courthouse that they never would have had to spend if you and your spouse or partner made Powers of Attorney.
     2.  Set up a Health Savings Account.  I know I sound like a broken record, but I don’t know the downside of setting aside pretax dollars to pay for out of pocket medical expenses that you will someday need to pay.  Unless you have a Cadillac health plan, the deductibles on insurance have increased drastically.  HSA savings can be rolled over from one year to the next, so even if you don’t have a lot of health care expenses now, you can accumulate dollars for future use.  HSA dollars can be used for long-term care insurance premiums too.  If you don’t want one for yourself, set them up for your kids.  It’s a great way to give them money that they can’t waste.
     3.  Quit Speculating on Interest Rates and Stop Trying to Time the Stock Market.  Two of the least productive endeavors ever. You don’t have to own stocks. Decide what your investment philosophy is and stick with it.
     4.  Consider Buying Life Insurance.  I often tell people that what I sell nobody wants.  Life insurance is at the top of the list. But life insurance offers many benefits if people would just take the time to consider it.  Not the least of which, life insurance should be considered as an asset class that can bring stability and certainty to the mix of other assets we own that change in value daily.  A new product in the marketplace is joint first to die whole life.  Yes, a policy on two lives that pays on the first death.  A great idea for young married couples that are both in the workforce as well as older couples that want to make sure they have enough assets to last two lives.
    5.  Decide How You and Your Partner or Spouse Will Pay for Long Term Care if you Ever Need it.  You don’t have to buy long term care insurance, but telling yourself that you will never need the assistance of a home health care worker or have to pay for skilled nursing care, is wishful thinking. Statistics tell us otherwise.  If you decide to self insure, think about which assets you will sell first to pay for your care.
     I could think of a few more, but I thought five was a enough.  Happy New Year!

About LPL Financial
LPL Financial (Nasdaq: LPLA) was founded on the principle that the firm should work for the advisor, and not the other way around. Today, LPL is a leader in the markets we serve,* supporting nearly 20,000 financial advisors, and approximately 800 institution based investment programs and 500 independent RIA firms nationwide. We are steadfast in our commitment to the advisor-centered model and the belief that Americans deserve access to personalized guidance from a financial advisor. At LPL, independence means that advisors have the freedom they deserve to choose the business model, services, and technology resources that allow them to run their perfect practice. And they have the freedom to manage their client relationships, because they know their clients best. Simply put, we take care of our advisors, so they can take care of their clients

*Top RIA custodian (Cerulli Associates, 2020 U.S. RIA Marketplace Report); No. 1 Independent Broker-Dealer in the U.S (Based on total revenues, Financial Planning magazine 1996-2021); No. 1 provider of third-party brokerage services to banks and credit unions (2020-2021 Kehrer Bielan Research & Consulting Annual TPM Report); Fortune 400 Company as of June 2021. LPL and its affiliated companies provide financial services only from the United States.

Jones & Company and LPL Financial are separate companies.

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