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Have you ever lay in bed dreaming what you would do with a sudden financial windfall? Would you buy a new house or travel around the world or buy a ridiculously expensive car? Would you quit your job? Or would you create a plan to segment your newfound wealth into buckets in a reasoned, thoughtful way? Maybe 1/3 to your future, 1/3 to charity and 1/3 to the blow it out, crazy, can’t remember where that came from fun bucket?

Recently I came across separate articles of two different athletes who earned a lot of money in a short time but approached their new financial standing in completely different ways. Here are their stories:

Enjoy this month’s edition that features an announcement by TD Ameritrade, a reminder of year-end distributions and 2020 contribution limits.

Charles Schwab to Acquire TD Ameritrade

As I penned this blog on the back of a barf bag while stuck on a Southwest plane waiting to have it’s malfunctioning electro-optical peanut butter sensor repaired, it seemed an appropriate time to remind myself of a few of the many, many things I’m grateful for.

Did you owe tax last year after the federal tax law changes? I did. Last year the IRS changed withholding guidance for employers that may have put more money into our checks but left us with a larger payment at tax time. Now is the time to check whether you’ll owe or get a refund and how to adjust if you need to.

Enjoy this month’s edition that features a best practice on your accounts plus commentary on investments so far this year.

Save the Date for the Moneywatch holiday party and open house on Thursday, December 12 from 4:00-7:00 PM.

The Medicare alphabet soup of options reminds me of that old Abbott & Costello routine, “Who’s on first?” where Abbott’s list of the baseball team’s players – Who, What, etc. – is also a non-responsive answer to Costello’s questions. Don’t remember that? Good for you, Medicare is probably years away. Chuckle, like me, when you think of that bit? Probably need to pay attention to this.

When you go to a car dealership you expect to be sold a car, right? In fact, they’re called salespeople. You both know the relationship of the other so you know what to expect. No problem.

Similarly, if you go see a financial advisor you expect to get advice. But, how do you know if that advisor is truly providing advice for you or really just trying to sell you something, such as life insurance or an annuity?

I love the big pass play in college football. In fact, one of my fondest football memories is the Andre Woodson to Stevie Johnson touchdown pass to beat Louisville in 2007. Even today, watching that play on YouTube gives me goose bumps. One thing I don’t care for, however, is the “expert” in the stands constantly yelling at the offensive coordinator to “throw the deep ball!” As much as I love them, those are low-percentage plays that are prone to incompletions or, worse, interceptions. They add risk to the team’s goals to score and win and should only be employed within the overall game plan.

My friend Jed came into wealth from some bubbling crude a few years back and decided to invest some of that newfound cash. Now, being a simple but wise man, Jed knew instinctively that he shouldn’t put all his eggs into one basket, but he didn’t know what kind of baskets to use and how many eggs to put into each. So, he decided to seek some advice from a Certified Financial Planner™ professional. This highly trained advisor, bound by a strict code of ethics requiring him to provide Jed advice strictly in Jed’s best interest, recommended he diversify his investments because that would help reduce his risk and smooth out his investing ride.  

As a generous man, Jed gifted part of his life-changing windfall to his son, Jethro. Now, Jethro is also a simple man but maybe not quite as wise as his father. In fact, he was quite comfortable keeping all his proverbial cereal in one, very large bowl. He didn’t seek professional financial help, other than his friend from the bank, Jane Hathaway, who readily agreed with Jethro’s suspenders and more suspenders approach.

Enjoy this month’s edition that features a review of the last 12 months of the stock market.