Making Margin

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind this episode of Making Margin:

• Nick
• Allie  
• Jeff
• Drew

Today’s topic is all about housing, specifically the recent housing price boom.

Discussion Topics:

• Home prices are up 15.8% on average year-over-year across the country according to a recent National Association of Realtors’ report (and in some places like Miami are already officially in super-boom mode).
• Supply hasn’t kept up, demand has accelerated during pandemic.
• What’s leading to this?
• Is it a bubble?
• What’s our advice?

Resource:

https://www.forbes.com/sites/petertaylor/2021/04/18/yes-americas-housing-market-is-officially-over-heating-everywhere-how-long-can-it-last/?sh=1afb56a24437

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind this episode of Making Margin:

• Nick
• Jeff

Today’s topic is all about sustainable investing. 

• Socially responsible investing, social investment, sustainable socially conscious, "green" or ethical investing, is any investment strategy which seeks to consider both financial return and social/environmental good to bring about social change regarded as positive by proponents.
• All sorts of different ways to look at this but today we’ll talk through our approach for clients who are looking for this sort of thing.

Resources:

Give.org to see details on orgs

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Jeff
• Drew
• Allie

Today we’re talking about changing your mind, which seems abstract, but actually has a lot of applications to finance.

• As we start to get to know our clients, we like to find out about their background; then we talk through where they are now, then where they (think) they want to go
• Reality is that a financial plan is just a lot of assumptions about an unknown future, and we’re creating it with our current selves
  
   

Discussion Topics:

• Tell me something you were convinced about that you’ve changed your mind on (style, preference, whatever). Do you think you’ll change your mind about that thing again?
• Are there other things you’re convinced you will/won’t change your mind about?
• How can we build plans that allow for people to change their mind (a potentially expensive reality)?
• We all have inherent biases due to our way of thinking. Here is just a small sample of common cognitive biases:
• Law of small numbers: We bias towards anecdotal examples rather than statistically significant data. So we may generalize one incident to an entire population.
• Confirmation bias: We may be too quick to seize on limited evidence that confirms our existing perspective. And we may be too quick to dismiss contradictory evidence for the same reason.
• Over-optimism: We tend to come up with plans and forecasts that are unrealistically close to best-case scenarios.
• Assigning cause to random chance: We are quick to assign causality to events that may in fact be unconnected.
• Recency bias: We bias towards recent events when we make judgments and decisions.

Resources:

“Strong opinions, weakly held”: https://medium.com/@ameet/strong-opinions-weakly-held-a-framework-for-thinking-6530d417e364

How Risky Is It, Really?: Why Our Fears Don't Always Match the Facts

https://www.amazon.com/gp/product/B003O86EZK/ref=dbs_a_def_rwt_bibl_vppi_i0

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Allie  
• Jeff
• Natalie
• Drew

Today’s episode: 

• Second part of our Kids and Money series talking about expenses for kids. What should they be responsible for? And when? How much of their allowance should we allow them to spend?
  
   

Discussion Topics:

• Tell me your experience with spending as a kid.
• How do you go about offering advice on what kids can buy?
• What spending limits should we put in place for kids?
• What about giving and saving? 

Resource:

http://myclassroomeconomy.org/

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind this episode of Making Margin:

• Nick
• Allie  
• Jeff
• Natalie
• Drew

Today’s topic is all about kids and allowances. When to give? How much? For what?

Discussion Topics:

• We talk about our experience with allowance as kids.
• Should you give allowance for something specific or just for existing as your kid?
• How much should it be given? Cash? Debit card? 
• When should it start?
• Should it change as time goes on? Does it grow as they get older?
• Should we give them money or gifts for holidays/birthdays?

Resource:

https://www.greenlightcard.com/

Episode 21 - Who Needs a Financial Advisor?

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Jeff
• Natalie
• Drew

Today’s topic is all about who actually needs financial advice. 

• Because of resolutions, a lot of people start looking at what a good financial advisor does at the start of the new year.
• We’re trying to redefine what a financial advisor can provide and to whom they can provide it.
  
   

Discussion Topics:

1. According to Advice That Sticks there are a few main reasons why people initially seek out an advisor: 
   1. Confirmation for a decision they are making
   2. A solution to a long standing problem
   3. A solution to a new problem (i.e. inheritance)
   4. Wanting help or guidance during an emotional time (i.e. divorce)
2. People think that most of the conversations we have with clients is surrounding investments, when in reality we primarily discuss their personal goals and things outside of the typical portfolio of stocks and bonds. One of our main goals is to help people avoid mistakes, and that doesn’t just mean investment mistakes. 
3. The person that doesn’t need an investment advisor is the person that has the time, knowledge, and desire. If you don’t have all 3 then it is probably worth outsourcing.
4. A financial advisor provides an unattached and unemotional approach to investments.

Take Away:  More people could find significant value in a good financial advisor than you might think. Traditionally, high-quality advisors were reserved only for the uber-wealthy, while the rest of us were stuck with product salesman masquerading as advisors. That’s changed, though, and now a solid financial plan is available to just about everyone.

Resources:

Advice That Sticks by Moira Somers

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Jeff
• Natalie
• Allie

Today’s topic is all about Christmas traditions and how to create a generous family culture. 

• Christmas Traditions: Past, present, future.
• What was gift giving/receiving like growing up?
• What traditions do you want to continue? What do you want to change?

Advice

• Create traditions that put others first
• Include some sort of charitable intent; include kids in it
• Limit the number of gifts; maximize the number of experiences

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind Making Margin:

• Nick
• Drew
• Natalie

Today’s episode: 

• How can we be confident in 6% (or higher!) growth rate?
• Why do we think it’s important to have equities (and/or bonds) in a portfolio?
• We have to set some expectations regarding investment planning. So, how do we come to the conclusions that we do when designing a portfolio?
  
   

Discussion Topics:

• There is an equity premium.  We know intuitively that the founder of a company has more to gain and more to lose than the bank from which he borrows the money.  A bond is comparable to a bank that is lending out money.  The bank expects the return of their capital and a slight return on their capital.  A business owner is looking for a multiplication of capital.
• The longer the history, the more confidence you can have -- Looking at monthly data in the US from January 1926 to July of 2020, there have been just over 1130 months.  This means that there have been over 1000, 10-year periods - 120 months squished together.  
• Have a realistic expectation - Morgan Housel wrote, “Markets crash all the time. You should, at minimum, expect stocks to fall at least 10% once a year, 20% once every few years, 30% or more once or twice a decade, and 50% or more once or twice during your lifetime.”
• What’s the point of investing? Maximizing return or reaching a goal?
• Investor’s Manifesto

Welcome to the Making Margin podcast! Greenway’s team is here to discuss common financial mistakes and to help you navigate them. 

Meet the voices behind this episode of Making Margin:

• Nick
• Allie
• Jeff

Today’s topic is all about alternative investments.

• For some time now, university endowments have included alternative investments in their portfolios attempting to both diversify their risk, and increase their return on investment.
• Most have been unsuccessful in actually increasing their returns, and according to a recent report, that lack of success is in direct proportion to the percentage of alternative investments in the portfolio
• Should individual investors hold alternative assets, or are plain vanilla portfolios just fine?

Discussion Topics:

• Traditional asset classes
  • Stocks, Bonds, & cash
• Alternative assets
  • Commodities
  • Real estate
  • Master limited partnerships (mostly in the energy industry)
  • Private equity
  • Hedge funds
• In theory, who might be a good fit for alternative asset classes? What’s the potential benefit?
  • Wealthy investors
  • Large endowments/non-profits
• In reality, what have the drawbacks been?
  • Lower return, Higher cost, & Dependence on manager selection
• Do we hold any ‘alternative’ assets in our client portfolios?
  • closest we get is REITs
• Do people need the additional diversification benefit that alternatives bring?
  • Mostly no

Take Away: A plain vanilla portfolio may be just what you're looking for.

References: 
https://bit.ly/3evtgL1 
https://bit.ly/3mZFm1M