The end of the year is near. The time is now to prep for year-end decisions. Today’s show covers topics around year-end planning and reviews the things that you have control of within your financial plan. Alex starts the show with discussing interest rates. Rates are at historic lows in terms of borrowing and you should be exploring your options to take advantage of this low rate environment.Jason shares a story about a client that he recently spoke with were it did not make financial sense to refinance and to watch out for toxic information. This client was initially led into thinking that since everyone has been talking about refinancing. She should as well refinance. This is not always the case and working with a trusted professional is key. Alex discusses how banking institutions are requiring investment assets to be moved into the lending bank prior to loan approval to potentially qualify for a reduced mortgage rate. Unfortunately, this scenario does not guaranty a loan approval and can disrupt a well-managed investment portfolio.

Jason adds, not to mention, the potential tax implications of selling securities with gains to satisfy the lender’s request. Closing take away; be sure to work with trusted professionals that work together to manage your best interest.

Jason segued into the topic of paying off your loan early and how it typically does not make good financial sense given the current low interest rate environment and the potential average rate of return in an investment account. Alex adds that those focused on paying off their loan tend to under fund retirement accounts and miss out on compounding interest and growth. Rebalancing your portfolio is the second topic discussed. Jason posed the question, how many clients that manage their own investments, properly rebalance using a strategy or philosophy? AND how many advisers do account rebalancing the right way? Jason further explains tolerance band rebalancing used in Intelligence Driven Advisers (IDA) portfolios and the benefits associated. Alex discusses how this year has been an incredible example of portfolio management through rebalancing and utilizing tax loss harvesting as another component of rebalancing.

Tilting your portfolio to stay in line with global macroeconomic themes, is the third topic that Jason and Alex introduce. Where are we in the economic cycle? Politics, protests and movements are events that you need to be aware of, but do not let these short-term events dictate big moves in your portfolio. No, rather, make small tilts. Jason uses the analogy, of fine tuning the frequency of an old radio to make the signal sound crystal clear. Jason provides further explanation of tilting positions within your portfolio. Alex and Jason close the show with reminding listeners to save, given the current COVID environment many activities such as vacationing have been cancelled creating additional cash flow. Individuals should have more money available. Unfortunately, many are spending money on items that they do not need. Instead, use those savings to max out your retirement accounts and add to your investment accounts.

In this show you will learn about:

  • Interest Rates and Refinancing- Portfolio Rebalancing
  • Tilting Portfolios