What is wealth? - Part 3 of 3

So what is the point? Do not let the term wealth management be a deterrent or an attraction. It is the people and principals behind the name that defines the effectiveness. Wealth is relative, but consistency, transparency and execution are a discipline.

It has been nearly two years since the remarkable stock market volatility and uncertainty began. The subsequent time period has proven to have a number of impacts on the financial markets and the companies that function within it. We are in a period of learning as you go. With the housing market going on five years of declining prices and volume and mortgage rates at near all-time lows, we clearly have a sickly economy with a market that seems to be on life support via the Federal Government. Interest rates at extreme lows, unemployment at nearly 10% and overall uncertainty in policy making from Washington D.C. is a recipe for concern. Even so, there are strategic opportunities out there, proper processes and prudent steps available for those with needs and/or goals with their wealth.

That said, the real question and pursuit is not to derive an absolute answer to our financial ills, but rather to identify the best tools, medicines and actions to take to sustain individuals and organizations in this tumultuous time. It is in these environments that the need and ability to be neutral on investing is critical. Now is not the time to be pounding the table on what style, category or method will be best 10 years from now, but rather, it is to be nimble, opportunistic and flexible. Seldom before, have there been periods of such formative change in the fiscal future of a generation. Monetary and fiscal policy is changing, leadership is struggling and individuals are concerned. Now is a time to broaden the investment opportunities, tighten the belt and implement a plan that is wise and efficient.

A consultative process that will develop and expose concerns, goals and needs is critical. It is our view that investors should be asking: “What is the minimum amount of risk I need to take to accomplish my goals?” For too long, marketers of financial products have appealed to greed to pursue more than is necessary at the fatal expense of risk. We continue to find that risk is rarely understood and always experienced with disdain.

Be careful, be smart, be a wise steward.

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