Commentary September 2024
Labor Day is already upon us, a day that was begun in the late nineteenth century to recognize the contributions workers make to our country’s strength. Appropriately enough it now acts as the unofficial end of summer, reminding everyone it is time to stop thinking about vacation and get back to work and school.
We all mark time in our own way. When I was growing up, January 1st was never the true start of a new year. January 1st merely marked a day that came in the middle of winter and depressingly signaled the end of the holiday season and the end of winter break.
The real start of my year began with the start of the new school year, which back then was always after Labor Day. My mom would have taken me shopping and I was outfitted with new folders (crisp, clean, and colorful), new notebooks (different color covers for different subjects, each page blank and ready for all the new learning I was going to achieve), new pencils (each sharpened and ready), and a pack of new writing paper that would be divided up and go into each new folder. I remember the wonderful feeling of the beginning of things, the feeling of starting afresh.
The cynical among us might say it was all an illusion. That in a month or so the folders would be filled with the same old worksheets and would no longer look crisp and clean. The notebooks would look as if they had been through a war and half the pencils would be lost. And the “new” school year would bear a distressing resemblance to the previous school year.
That is not the way it felt to me, nor is it the way I choose to remember it. I rejoice there is a time of year when the air turns crisp, a time when you feel energized just stepping outdoors, and the promise of new beginnings beckons us. And that is what I wish for all of you.
So often, favorite sayings are repeated to the point that we become deaf to the blinding truth they convey. Yet, every day really IS an opportunity for a new beginning. We can get so caught up in our daily routines we lose our awareness of that stunning fact. A new year, a new outlook on life, begins whenever you decide to embrace it.
When we meet with you, we often discuss life’s milestones, all the different beginnings and all the changes. We want to make sure your today’s and tomorrow’s are protected. And for those, who are already a client of the Maar Financial Group, an awareness of that reality informed through the creation of your custom financial plan. Because we take the time to get to know our clients so well, we also attempt to take into account their dreams of future possibilities. But to paraphrase, “the future is a mysterious place; they do things different there.”
So, it may well be that what you thought you wanted years ago has changed. You have new goals, dreams, the tantalizing thoughts of “what if….” This happens more than you might think, and when it does, we delight in taking part in the planning that can make a dream a reality.
When Labor Day rolls around, there is still a part of me that feels the promise of all those wonderful new school supplies and recalls the autumn air filled with the smell of fallen leaves, apples, wood smoke all combined, a heady brew that somehow held the promise of tomorrow. May you feel that same mystery and magic. Each dawn really does promise a new day, an opportunity to begin whatever you wish. We will be there to help you get there whenever you are ready and wherever your dreams may lead you. Happy Autumn!
Commentary July 2024
Under the cover of darkness on April 18, 1776, Paul Revere set out on his midnight ride with other patriot riders towards Concord, MA to warn the colonists of the approaching British troops. The British intended to capture and destroy military supplies being stored by the Massachusetts militia and did not anticipate any resistance from the colonists. Because of Revere and William Dawes’ warning, when the British arrived at Concord, the militia was waiting for them. Shots were exchanged and war began, the war we call The War of Independence.
I find it impossible to write a commentary for the month of July and not be thinking about July 4th, the commemoration of that declaration of our independence from Great Britain. We are forever grateful to all those who came before and, thanks to their bravery, we can celebrate this day together as one nation.
Throughout our lives, each of us experiences moments of independence and dependence that are just as monumental to us personally. We are born into the ultimate state of dependence and spend the first years of our lives helplessly reliant on our caregivers. Parents and children alike hold fast to those moments of incremental independence: a baby’s first words and steps, a child’s first day of school and first bike, and a teenager’s first job and newly acquired driver’s license. These moments represent transitions in our life stages away from dependence and towards independence. To be independent is to no longer be controlled or coerced by anyone or anything else. One can stand on their own and has freedom of decision making and movement.
One of the primary things we do with clients is prepare them for retirement, which when you think about it, is a type of declaration of independence. When you are part of the workforce you are tied, in many ways, to those who pay you for your time and skills. Most of us cannot sever the tie to our jobs whenever we choose without seeking another means of employment.
Yet, when you retire, the goal is to be financially independent. That does not mean you are cut off from all sources of income. You may be receiving Social Security checks or distribution from a pension fund. That is money you have already earned. The legal obligation is on the payor—not the recipient. So, yes you are financially independent, which sounds great, but as the colonists in 1776 soon discovered, independence carries with it new types of problems and responsibilities.
Through hard work and planning you have prepared for this moment--that shift of responsibility. Now it is all on you and it can feel overwhelming. How much can you safely spend each year? How much should be kept for emergencies? What about special plans, such as travel? And maybe most important: what can be done to help your savings grow? That growth will provide answers to those previous questions.
But here’s the thing. This doesn’t have to be something you do alone. “Depend on” means a relationship of trust, nurturance, and guidance. Everyone’s situation is, to one degree or another, unique. That calls for support that comes from those experienced and skilled in dealing with all that “independence” demands. That is exactly the support we here at the Maar Financial Group provide. We help you arrive at answers to all your questions and anticipate ones maybe you haven’t thought of yet.
July 4th is a day of celebration and fireworks. Enjoy every bit of it. But it is just one day. We will help you get ready for July 5th and all the days awaiting you.
Commentary May 2024
Over the years I’ve been doing these commentaries we have discussed many things, but rarely do I bring up anything I consider personal. Not because of an unwillingness to share, but more because this isn’t a personal diary—I see it as a forum to discuss economics and the market. This month I’ve decided to write from a more personal place and for those of you who might be reading this and don’t know me, this may serve as a bit of a personal introduction.
Last month our family had to say goodbye to Oliver, our twelve-year-old miniature poodle. Many of you know what this was like. We didn’t lose a pet; we lost a family member. For most animals that share our homes and lives, their life spans do not mesh with ours, and sadly the price of loving a pet is one of eventual loss.
Ollie’s loss prompted many reminiscences and thoughts. Strangely, one thing I found myself thinking about was how I began my practice twenty-eight years ago. Back then I primarily provided life insurance services and, yes, I know the cliched image of life insurance salespeople. I think I’ve heard most of the jokes. But it didn’t bother me, because I understood through my training that we were helping people “to mitigate loss,” which, according to Webster, is defined as “to make less severe or to alleviate.”
I was young and blessed enough that I personally had little direct experience with loss. I am older now, and of course, that is no longer the case. I find now that mitigate is not the best word to describe the value of insurance. Yes, insurance can reduce the risk of financial loss, but it does little to make the pain of the real loss less severe or alleviate it.
When we discuss insurance, what we are really discussing is mortality which is why many people are reluctant to even discuss life insurance. It is as if by discussing the issue, we are somehow opening a door most people would rather leave firmly closed. I understand that better today.
I also understand that I was right in believing in what I sold. As the years have gone by, many of my clients have relied on their insurance policies. No, it did nothing to make the true loss less painful. But it gave people fewer things to have to worry about. It helped people have the tools to begin to overcome their loss. I once heard the placement of life insurance described as “helping people in the battle of life.” That is not the way I see it. If life is a battle, then there is only one way that war will end at some point.
Instead, I embraced the idea that I was helping people “experience the possibilities of life.” And so, as my practice grew, it was natural for me to add other services to my business. Investment planning, college saving, retirement planning—all of it was ultimately about increasing the possibilities of life.
If you think I am using the story of Oliver to make a point about my practice, then I have done a poor job of explaining my thoughts and emotions. The work I do is a big part of who I am and all these thoughts ran together. And who I am was taken aback by how much the loss of this little fellow hurt. Over the years, I’ve also have learned that the only thing that really mitigates the pain is time; and sometimes, even then, it only dulls the edges.
I also know that in the upcoming weeks and months I will find myself once again discussing the importance of life insurance with clients. I better understand its limitations—what it can and cannot do. But what it can do, it does well. It is a valuable service, and I will do all I can to help people understand that. We can only mitigate so much. But we must do what we can.
Godspeed Oliver.
If requested, a licensed insurance agent/producer may contact you. See thrivent.com/social for important disclosures.
Commentary March 2024
I recently heard a historian observe that the need to know the time is a relatively recent development. For just about all human history there were only three-time related events that mattered in daily life. Sunrise, sunset, and midday when the sun was directly overhead. The idea that there was such a thing as 3pm didn’t exist. There wasn’t even a mental framework that would have allowed humans to understand the concept. It would represent a precision of time that was meaningless.
Then came time as measured by mechanical devices. Every village had a clock tower and time was measured in terms of community activities. There was no need for individual time pieces. It would be centuries before such devices were invented and became affordable. Of course, that has all changed and we now live in a world where knowing the exact time has become a requirement of life. Today everyone wears a watch and/or carries a phone that delivers time specific to the very second.
I’m telling that story as an example of how our expectations about accuracy have changed. I remember my first watch. Every few days I had to adjust the time, but it was just accurate enough for a young boy. That is no longer acceptable. Soon even accuracy wasn’t enough—we wanted precision and once again technology delivered. This has been a trend that has impacted almost every aspect of life. Automobiles were designed with mechanical tolerances that ensured an engine would last for about 100,000 miles before it was worn out. Today an engine lasting for 200,000 miles is the minimal norm.
What has happened is that we have come to expect that type of accuracy, even precision, from many fields—including the financial industry. And there have been significant steps in that direction. Any given financial instrument now trails behind it a vapor trail of data, projections, and a variety of tools for measuring relative risk and growth potential. So, one might believe that once a person has created a financial plan, using all of today’s relevant tools, that the plan is then a finished task. One can now rest easy and not have to think about it anymore. Those of you that have worked with me for any length of time know this is not the case.
Markets are dynamic and ever-changing. Your life is just as dynamic and subject to change. While we design plans that allow for the flexibility that time demands, that does not reduce the need for us to meet on a regular basis and review the plan to be assured it continues to meet your needs.
Your plan exists in an environment influenced by existing and anticipated changes to tax codes. We are not a substitute for the services of a tax accountant, but we can speak with authority as to how taxes can impact your financial planning. This is just one of those things that requires regular review.
Markets are impacted by national and world events. We may not think of these as being economic in nature, but they have significance that requires attention. Every country is part of a web of connections to other countries. Trade imbalances, international tension, and even armed conflict are an unfortunate backdrop to every investment decision. Every two years the United States has a national election that changes the make-up of the Senate and House of Representatives. This is a presidential election year. This may or may not impact markets, but it too is something we monitor.
The atomic clock at the University of Wisconsin is precise to the point of losing just one second every 300 billion years. Technology that precise is only possible with mechanical systems. Human systems, of which the markets are just one example, cannot offer any similar version of accuracy. They require watchful vigilance. And that is what we offer when we meet with you for a review. We do this with regularity because we know—the clock is always ticking.
Commentary December 2023
When Irving Berlin wrote “White Christmas,” he was in California staring out at a green landscape far from treetops filled with snow. On December 25, 1941, Bing Crosby debuted the song at the Kraft Music Hall radio show. Crosby not only turned Berlin’s “White Christmas” into the best-selling Christmas song of all time, but the best-selling single world-wide ever.
As we know the song opens with the words, “I’m dreaming of a white Christmas just like the ones I used to know.” Berlin admitted that when he wrote the song he had never experienced the sort of Christmas “where treetops glisten and children listen to hear sleigh bells in the snow” and neither had most other people who heard the song. Yet every year, people hear the song and get misty-eyed and nostalgic for this image of a Christmas that isn’t a reality for most.
The poet Dylan Thomas, who wrote A Child’s Christmas in Wales, said that in his mind every Christmas was covered in snow. He later learned only two of his childhood Christmases had anything more than a dusting of snow. I doubt Thomas was having memory problems. He was experiencing what is truly magical about the season. It’s as if our memory takes all our Christmases and shakes them as if in a snow globe, and what we see is, in its way, the perfect Christmas.
So in the snow globe of my Christmas memories I always have that magical white Christmas. In it are my Mom and Dad, Grandma and Grandpa as we gather around the Christmas table. I see our first Christmases as Erica and I were raising our family. I see the children, still young and so excited that Santa had come, all kneeling around our Christmas tree staring with wonder at the wrapped presents that had mysteriously appeared overnight.
I experience again the joy of the church Christmas programs that told the story of that first Christmas, the children all appearing in ever shifting roles as they grew. I look around and see all their grandparents smiling, laughing, photographing. We come out of the church in the stillness of a Christmas Eve where it is always blanketed in softly falling snow.
All of this merges with more recent memories, ones where our children are older, home from school and thus their presence is even more precious to us. Then we gather around another Christmas table, our table, and there they all are, happy, everyone talking at once as Christmas carols play softly in the background. I can close my eyes and feel the peace and joy of this most special of holidays.
I imagine many of you have similar memories. Christmas is an experience that is both unique and shared by all. It is true that probably none of us have “listened for sleigh bells in the snow,” or perhaps I’m wrong. Maybe we all are still dreaming of that perfect white Christmas where the treetops glisten and children listen for sleigh bells in the snow. Chances are you will find it in your Christmas memories.
May all your Christmas dreams come true, and may the magic of the holidays extend into the New Year, where all of your days will be merry and bright.
Commentary September/October 2023
The past can seem, as someone once said, like an alien country. At the turn of the 20th century, a now largely forgotten battle occupied a central place in American politics over whether the US dollar was going to be backed by gold, silver, or a combination of the two. For over 30 years, spanning an entire generation, this issue remained central to elections and inspired feelings so intense it was said people within families stopped speaking to each other if they had differing views. People would cross the street to avoid someone who in earlier times they considered a friend but was now an enemy over the issue of gold vs. silver. When the United States went off the gold standard, former congressman and ambassador to Great Britain Lewis W. Douglas said, “This is the end of Western civilization.”
People can certainly get carried away over things that in retrospect seem foolish. More recently, between 1995-2000, American markets experienced what was known as a “tech” or “dot.com” bubble. Many of you may remember this as a time when the mania for finding the next tech giant reached fever pitch. It seemed almost any tech start-up could raise millions in the market, despite never showing any profitability or sometimes even a business plan. The Nasdaq Composite index rose from 700 to 5,000 due to this frenzy for tech stocks. If you felt things were getting a bit carried away, you were told the fundamentals no longer applied. It was old-fashioned to focus on things like debt, profits, or market share. It was a bold new world.
We can shake our heads, but most of us have had personal experience with getting carried away by the enthusiasm of the moment. It is only when the enthusiasm has abated that we look at the clothes or car we bought and ask ourselves, “Now, why did I do that?”
One of the reasons to work with investment professionals is to avoid getting caught up in the intensity of the moment. But wait, you might think, can’t even professionals fall prey to these traps? After all, it wasn’t just the small investor buying dot.com stocks. You would be right, and that is why one of the key elements in choosing your investment professional is the amount of experience they have. The Bible tells us, “there is no new thing under the sun.” (Ecclesiastes 1:9) I’ve been an investment professional for 30 years, and if I haven’t seen it all, I’ve come close. An experienced advisor can draw on those decades of experience to help you navigate the rocky shoals of the different and difficult markets.
Experience isn’t the only attribute your advisor should have. You want to work with someone who has the up-to-date training to understand all aspects of investing. And finally, an attribute that can be hard to define but becomes apparent when you work with someone. Do they have the temperament that meshes well with yours? Are they the sort of person who will help you chart a path, help you stay on the path, and know what warrants concern as opposed to something that is just the noise of the moment.
Everyone should be able to find a professional that has the temperament that meets their perceived needs. As for me, the relationships I form with my clients tend to be long-term. I never believe I am just going to be working with someone for a year or two. My clients and I are on a journey—together. It may well turn out to be a life-long relationship.
Like the song says, “you must remember this…the fundamental things apply, as time goes by.” And despite all the changes that have taken place since people were so worked up about gold and silver, there ARE fundamentals that will always apply. You just need to be sure you are working with someone who knows what they are.
Commentary August 2023
A man was walking down the street when a large sinkhole opened up before him and he fell in. He soon realized he could not get out and began to call for help. A lawyer heard him and threw him a law book and walked away. An engineer heard him and threw down some architectural drawings and walked away. A friend came by and promptly jumped into the hole. “You fool,” said the man. “What did you do that for? Now we are both trapped.” His friend shook his head. “I’ve been where you are and I know the way out.”
I think there are a couple of lessons in that story. The first is that there is no substitute for experience. The second is that no matter who we are, or what our situation, at some point we will all need help. The Maar Financial Group bases our practice on those two principles.
This month on Facebook I posted a couple of times about how the mood we are in can affect the decisions we make. It used to be thought that our moods were fleeting emotional reactions, perhaps worth some passing interest, but lacking any major significance. Recent research has discovered that mood can change our cognitive processing—in other words, it can completely change the way we think.
If we are in a bad mood, we are much more likely to focus on small details. We don’t do this because we have suddenly become more discerning. No, we are doing it to be contrary, actively searching for reasons to be negative. With such thinking we are much more likely to reject any advice or planning.
If we are in a good mood, we are much more likely to be receptive to new ideas. We don’t do this because we have suddenly become more open-minded. Our critical powers become mute because we want to keep feeling positive. With such thinking many things will sound like good ideas, even ones that aren’t.
This might not seem important, and if the decision you are trying to make is where to eat for dinner, it probably isn’t. But if the decision you are trying to make involves planning your financial future, the stakes obviously become much more significant. The solution is obvious and no less important for it being so. It is crucial you work with experienced partners, ones not prone to embracing whatever current thinking is sweeping the investment community. It is crucial you work with partners who have taken the time to know you, your background, and your hopes and dreams.
Gathering all this information about you is a critical first step. We devote significant time getting to know you, addressing all your questions and concerns, and working with you in designing an individually responsive path forward. This is the right way to create a positive outlook. One that is based on experience, hard data, and durable truths. And there ARE durable truths, even in the ever-changing world of finance.
Our experience, knowledge, and understanding will be resources you can and will draw on as we work together. Positive emotions and experiences change the way you process information and the actions you take based on those experiences. Thus, there are many reasons why we want the time we spend together to create feelings of growth and well-being.
To return to the analogy with which we began: we have been where you are, we do know the way forward, and we are here to help. As we explain to our clients, the sooner we begin our journey, the better.
Enjoy the waning days of summer and I look forward to seeing you soon!
Commentary July 2023
“Let’s Celebrate Giving-Forward”
Thrivent’s President and CEO, Terry Rasmussen, wrote in Thrivent Magazine’s latest issue:
“We are particularly proud of recently achieving a milestone that would not have been possible without you. Thrivent successfully raised $1 billion for communities across the country through one million client-led volunteer teams, also known as Thrivent Action Teams.”
I share that pride because many of our clients have started or are part of Thrivent Action Teams. By doing so, our clients directly contribute to this program’s success and raise the quality of life in our communities.
We often refer to such actions as “giving back,” but I think that phrase points us in the wrong direction. The phrase has its origins in the idea of people, such as athletes, who have achieved such a level of wealth that they feel a desire to “give something back.” Inherent in the “giving back” concept is the image that the giver and the recipient are on two distinct levels with the giver, whether out of a sense of noblesse oblige or guilt, reaching backwards to a recipient who has fallen behind. There can be no doubt who has the power in the relationship.
I think, for Thrivent members, the more accurate term is “giving forward.” Ms. Rasmussen, in highlighting the member leading the one millionth Action Team, described the client as “a horticulturist who uses tools and resources from Thrivent to provide seedlings to community gardens, who then provide fresh food to people in need who don’t have access.” None of this involves looking back or giving back. Rather, the momentum is all forward. The Action Team provides seedlings for gardens (and is there a more apt metaphor for the future than seedlings?), the gardens produce food, which will then also provide the seeds and plants for future growth. The act of giving reaches into the future and will continue to grow.
This philosophy of forward momentum is reflected in all we do here at Maar Financial Group. The past can help us understand how we reached the point where we are at but offers imperfect guidance for what happens next. The world, markets, and you are constantly changing and any plan for the future must reflect that reality. As you know, I’ve written in previous commentaries about how we create plans with clear goals that are also flexible enough to adjust to changing circumstances and I want to stress that just like the Action Team provides seedlings for future growth, we are always focused on looking forward.
It might seem that discussing planning and looking forward together is redundant, but it isn’t. Researchers tell us that people are most comfortable with decisions that resemble ones they have made in the past. In a sense, as one scientist put it, “we endlessly track ourselves through life.” We don’t believe that is necessarily the best way forward. The types of choices we made ten years ago may not be applicable today. So yes, we look ahead. We consider both the near future and the long horizon. And while it is true no one can see past the horizon; the fact is the horizon changes depending on perspective.
We believe in giving forward, it is good for us personally as well as important to our communities. We believe in looking forward. Our past does not define us. We believe in planning forward. What has happened in the past does not reflect the reality of today and certainly not our vision of the future. How to get there? The best way through is always forward.