The Return of the Blog

Posted on October 9, 2015 by Chris

In mid September I attended the XY Planning Network 2015 Conference in Charlotte. This was my first conference experience since Logan was born and I was looking forward to being able to attend, but I wasn’t quite prepared for the impact it would have on me.

The conference had a positive impact in several areas of my personal and professional growth. One area of immediate impact is the return of the blog and the launch of my newsletter. I had been wanting to revisit the blog and launch a newsletter, but I was in a perpetual cycle of creating roadblocks. What format should I use? What template would I need to create? What software do I need to use for the newsletter? What topics will I need to make sure I cover? The answer to all of this presented itself in the closing session of the conference.

Carl Richards of Behavior Gap was the closing speaker of the conference and his advice was clear and simple. Stop thinking about the logo, where it should go, and just make it happen. For me this was the newsletter. He continued on to say that a newsletter could simply start out as a collection of brief thoughts or interesting articles. It would organically grow over time and you can add in all the features down the road, but stop worrying about it and just make it happen.

This resonated with me since the newsletter and blog were items I wanted to do, but I was creating deterrents in making it happen. My goal was to launch the newsletter a week after the conference, and I met that goal.

The personal growth was not only in being able to reconnect with some influential people in my life, but being able to reconnect with an industry and profession. At times I’ve felt out of touch with the financial planning profession. The group of planners at this conference are all bucking the normal trends and business models of the financial planning profession and it was great to not feel like an outsider.

For you, my incredible blog readers, I encourage you to make sure that you don’t lose your sense of passion. It’s easy to get caught up in the bustle of life, family, and work and find that you lose touch with some of the essential parts of who you are. Take the time to pursue your interests, even if it’s only a few minutes every week. Keep your passion fierce not only for you, but in order to share it with the people around you.

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Market Awareness

Posted on October 2, 2015 by Chris

I am going to make a bold promise.  I promise to never send you an urgent newsletter or blog post about a bad day or possibly even week in the stock market.

As a financial planner, one of my goals is to help investors build diversified investment portfolios.  A diversified portfolio will more than likely underperform the S&P 500 every other year.  Yes, here it is up front, every other year I expect for your portfolio to lag behind the S&P 500.

The inherent risk of investing in the stock market also means we need to be prepared for the points in time when our portfolio will lose value.  I don’t expect portfolios to always generate positive returns.  We cannot have market or portfolio returns without taking on the inherent risk that comes with investing.  Our ability to withstand the potential for loss is what will ultimately help our portfolios continue to grow.

The most crucial aspect of investor behavior occurs during down markets.  When the market is down, that is when the uncertainty, anxiety, and fear about our investments is at the highest; that is when it is most crucial to step back, take a few deep breaths, and really evaluate if anything in our lives has changed where we need to abandon or change our financial plan.  Most investors become ready to sell as they watch their account balances drop because they can’t stand to see the diminished values on their statement.  But at this point in time, we are only experiencing a perceived loss.  If we don’t act on the urge to cash out, then we are still in the market, we are still in a position to be ready to take part in a market recovery.   If we act on these perceived losses, that is when we actually lock the losses into our portfolio.

All of what I’ve just said (well typed out) is understood and known by every investment professional.  We know that diversified portfolios will probably lag behind the major market indexes, we know that portfolios will experience volatility, and we know that at times the portfolios we recommend will lose value regardless of how well they are diversified.  The press that reports on the stock market knows all of these things too, but a calm attitude toward market downturns, doesn’t sell articles, magazines, newsletter subscriptions, and bring in viewers.

This idea to cause panic isn’t needed because the majority of the activity in the stock market is the known risk that comes with being an investor.  Why would I need to send out a newsletter telling you about a down day on the market, when down days are to be expected?  Market corrections are to expected, nobody knows when these events will occur or how long they may last, but that is why it is crucial to invest in a diversified portfolio.

The link below illustrates the randomness of returns on a wide range of asset classes.  As you can see the returns are not very predictable.  I’m not going to attempt to guess which one of these sectors is going to be this year’s best or worst asset class. There are too many variables involved for me to even consider trying to make a prediction, so instead of trying to guess, I use sound financial principles to design diversified portfolios to help capture a wide range of asset class and sector returns.

Radomness of Returns

My goal for every client engagement, is to set realistic market expectations before we even begin talking about investments.  The main reason I would have to send out letters to calm investors would be if I wasn’t taking the time to explain to you about the expectations for portfolio returns and the importance of diversification at the beginning.

Have a great weekend,

– Chris

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September 29, 2015 Newsletter

Posted on September 29, 2015 by Chris

September 29, 2015 Newsletter

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The Dynamic Money Relationship

Posted on September 25, 2015 by Chris

Last week I attended the XY Planning Network 2015 Conference in Charlotte.  I had the opportunity to hear some fantastic presentations and came home energized with new ideas on the future of VB Wealth.  This post is the first in follow up to my conference experience.

The first idea I want to share is on what I’m calling the Dynamic Money Relationship.  This idea focuses on the key relationships between increasing income, cutting expenses, and increasing savings in order to build wealth and help enable us to achieve our financial goals.

Increasing income is a powerful way to compound not only our earnings, but our ability to save for the future and our financial goals.  If you’ve been at your job for a few years, evaluate your salary and research what your peers are earning.  Check out Salary.com for an easy way to start researching salaries in your area.  Ask your boss about the requirements needed to receive a raise or promotion.  Read one hour a day on a subject related to your field or enhancing your personal skills.  Take that additional knowledge and use it in your job and at networking events.

Cutting expenses is also a very important part of this relationship.  If you evaluate where you are financially and see that you are falling short of your goals, cutting non-essential expenses is the first step in looking at ways to improve your overall financial situation.  This is also an area where we have a great deal of control over where our money is going.

The final piece is increasing your savings.  This could be committing to increase your retirement contributions by 1% every year.  Looking at a way to cut $100 of expenses out of your monthly budget.  Investing in properly diversified investments and paying attention to the underlying fees and expenses in your investment holdings.

All three of these areas have a direct impact on your current and future spending. If you’re looking to evaluate your financial picture, feel free to contact me and we can discuss the benefits financial planning can bring to you.

Like what you read? Sign up for our soon to be launched newsletter. The newsletter will highlight articles of interest on a wide range of financial and non-financial topics.

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2012 Money Action Plan – Part One

Posted on January 11, 2012 by Chris

If you’ve been on the internet over the past few weeks, you’ve certainly come across several articles on how to manage your money and smart money moves to make for the year ahead. In the spirit of the new year, I’m going to provide a four part series focusing on action steps you can take in the year ahead. The goal is to provide you with a calendar of steps that will allow to create concrete goals and steps you can take in the months ahead. Get ready to start on the first steps of your 2012 Money Action Plan!

January

Create a Budget – Sorry to pull the band-aid off right away, but if you don’t have a monthly and annual budget in place, it’s time to get them. You’ll want a monthly budget to cover your main cash flow needs (food, clothing, housing, utilities, transportation, etc). The idea of an annual budget is to help you plan for taxes, holiday expenses, birthday gifts, car insurance, vacations and any other expenses that crop up throughout the year.

You’ll want to have a plan in place to save for the items that fall in your annual budget since these can easily be overlooked in your budget since they usually don’t occur every month. Depending on when these expenses fall, you may have to maintain a higher savings rate at the beginning of the year to save up for expenses such as your summer vacation.

To help you create and track your budget, consider using Mint (www.mint.com), Quicken,  an Excel/Numbers spreadsheet, a pen and ledger, or notes on your 2012 calendar.

If you already have a budget, make sure to do an annual review of your 2011 income and expenses to see how you ended up. Did too many unexpected expenses cause you to drain your emergency fund or slow down that extra retirement savings? If so, look to see where need to make adjustments for 2012’s budget.

Increase Your Retirement Contribution – If you have an employer sponsored retirement plan at work, consider increasing your annual contribution percentage by 1%. If your employer offers a match (many companies that halted employee matches during the recession have been phasing them back in), try to contribute enough to receive the maximum match. The 2012 maximum elective deferral you can make to 401(k), 403(b), 457 & Roth 401(k) plans was increased to $17,000. If you’re over 50, you can also make a catch-up contribution up to an additional $5,500 for the year.

Don’t have a 401(k) or 403(b) plan? Look into opening either an IRA or a Roth IRA. You have plenty of flexibility on where you can open the account and it may not take as much money as you’re thinking to get started. The maximum contribution you can put in an IRA is currently $5,000 annualy, with an additional $1,000 available if you’re over 50.

You should speak with your accountant about which account(s) you will qualify for and any tax benefits that may be available to you. Your accountant can also help you decide on an appropriate retirement plan if you’re self employed. Your financial planner can also provide you with a general overview of the qualifications for several of these accounts.

February

Review Your Budget – You diligently worked on figuring out your monthly and annual expenses, now you need to see how you ended spending your money in January. See if you were on target or if your budget was completely overwhelmed by unexpected expenses (car repairs, vet bills, trip to the hospital). Make any adjustments you need to help you stay on track. Now that you’ve started the momentum, keep reviewing that budget each month. Remember that the goal is not to increase your budget each month, but to adjust your spending to reflect your budget.

If you didn’t track all those purchases, now’s your time for a second chance, and you can get started on creating your budget in the shortest month of the year.

Emergency Fund – A general rule of thumb is to have between three to six month’s worth of living expenses saved in an emergency fund. A good way to start is to work on saving enough to cover your auto deductible, then add on top your homeowner’s deductible and then work on having your health insurance deductible added to the mix. This will be a good way to have concrete objectives in building up your emergency fund. Your financial planner can help you design a specific emergency fund plan that meets your family’s needs.

March

Taxes – Work on your tax return(s) now. If you don’t have all of your tax documents, you can at least start working with what you do have. If you use an accountant, you can be gathering up any documents and receipts that you’ll need to provide. If you documents can be organized, your accountant will greatly appreciate your organized files. By working on  your taxes now, this will at least give you a ball park of where you may end up when it’s time to file and can give you an indicator if you may be sending a check to the US Treasury. If you haven’t taken advantage of your IRA options, you still have through April 17th (The tax filing deadline has been extended from the 15th this year) to get those contributions made and be able to deduct them on your 2011 return.

Spring Cleaning – As you go through the process of cleaning out your house, instead of tossing items that still have a useful life consider donating them to charity or consigning them. Ready to clean out the last few years of accumulated clothes? Same thing, consider consigning or donating them to a local charity.

Now it’s time to move on to all those paper documents:

Bank and Credit Card Statements – You generally won’t need more than a year’s worth of bank or credit card statements. You will want to keep any statements that show proof of purchases that you used when filing a tax return to claim an expenses or deduction with your tax returns.

Insurance Policies – As you receive updated policies you will no longer need to keep your older policies. If you have a claim in process, hang on to your old policy until your claim is settled.

Investment Records – Keep a copy of your annual statement until all investments on those statements have been sold. You may not need to keep your monthly or quarterly statements if the important information from those statements has been included on your annual statement (purchases, sells, deposits, withdrawals, dividends and capital gains paid)

Pay Stubs – make sure your pay stubs match up to what was reported on your W-2. If they match up, then you can shred your old pay stubs. If they don’t match up, ask for your employer or former employer to send you a corrected W-2, known as W-2C.

Major Purchases – If you’ve purchased jewelry, computer(s), artwork or other major items this year, keep the receipt or a copy of the receipt in a fire proof safe. In the event that you have to file an insurance claim, you will have proof of your purchase and the price you paid for the item (this applies to having to file a claim on your homeowner’s or renter’s insurance).

These steps will help you start 2012 on a good financial footing and will help you prepare for some of the other action items that will come up during the year.

If you’re looking for a more in-depth money transformation in 2012, I encourage you to call me at 919.695.3007 or email me (chris@vbwealth.com) so we can discuss the benefits and services I offer to help you move toward your personal and financial goals.

Wishing you a prosperous 2012.

Chris

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Supporting a Person in Grief

Posted on November 7, 2011 by Chris

As a financial planner, I work to create long-term relationships with my clients. Through this relationship, I am fortunate enough to be able to celebrate the family’s successes and achievements. I also realize that during times of crisis and grief, I will serve as an additional outlet of support. This is not the typical expectation that many people place on their financial planner, but through my experience, it is an important role that I have; I am in a unique position to assist the family during these periods. If you find yourself acting as a support person to someone dealing with grief, here are a few thoughts to consider.

Grieving is a process – this is crucial to understand. Everybody has a different process in how they grieve and how long the process takes, so don’t assume that if you have a short grieving process, everybody does.

Sit with them – this can be one of the most important levels of support you can provide. The pressure of having to share any feelings or words can be taken away, and they just have a person who can simply provide a supporting presence.

Let them feel sad – during a period of grieving, your sympathy and support will be more important than trying to cheer them up; sadness is a normal emotion to feel. Look for cues that they may be experiencing more than sadness and may be suffering from depression.

Be a good listener – let the person have an outlet to speak and share their feelings. Let them do the majority of the talking, and try not to give advice.

Ask about their feelings – this can be difficult, but it allows them an opportunity to express themselves. They may surprise you with some of the feelings they have.

Share your feelings – even if you’ve never gone through this experience, they may take comfort in knowing that they have your sympathy and that you have an emotional interest in them and their well-being.

Be available when you can – this just reassures them of your support, and they can know they have people to turn to.

Talk about your own losses – you may not have experienced the same type of loss, but you can share memories of your own experiences to help provide comfort.

Remember the loss – at times it may be uncomfortable to bring up the loss, but it gives you an opportunity to acknowledge the person, the loss they experienced and see that they’re moving through the grieving process.

These are just a few of the ways you can help support somebody that is experiencing grief. Here are two links to provide additional resources on the grieving process:


When working with families that have experienced a recent loss, I may play an active in role in helping the family deal with settling the financial affairs. Since I’m active in this process, I’m able to provide support to the family and see if lingering feelings of grief may be present. I also need to respect the feelings and situations these families are in so that I can make appropriate recommendations to the family on how to proceed with the financial goals or if the financial goals need to be reevaluated. It is important for me to anticipate that after a person has experienced a loss, they may need additional reassurance about their investments, investment strategies and goals. It is not unusual to see an attachment to certain investments; that will require me to address recommendations about these investments in a different manner.

A financial planner isn’t necessarily the person you would identify as being a support person to a family or person in grief, but because of the unique relationships I create with my clients, I am generally more involved in the grieving process than many people would expect. While I am not the one drafting the wills or other legal documents, I work with the family and their attorney to help make the process of settling the estate as easy a transition as it can be. I can help the family start to refocus on their goals and help them find motivation in moving forward. If through these conversations, I feel that they may need to seek additional assistance, I can voice my concerns to them in a professional manner.

If you’re experiencing grief, look for support groups in your area that can help provide additional support and resources to you.

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The Battle for Higher Education

Posted on September 22, 2011 by Chris

Earlier this week in an interview with Aaron Task from Yahoo Finance, former President Bill Clinton stated, “…the American Dream has been under assault for 30 years,”. The timing of his quote coincides very well with the topic of my blog discussing the rising costs of higher education. This post is designed to help give you some information and data that needs to be considered when evaluating your goals for education.

Most of us see a college education as a crucial tool in helping us fulfill our own vision of the American Dream. We also see a college education as a way to help our children achieve their own dreams. The importance placed on having a college education has also left us with learning how to handle the uncertainty of tuition increases over the past thirty years. We’ve seen dramatic changes in the cost of attending college over this thirty-year period. From my own experience, in the seven years since I graduated from Texas Tech University tuition has increased by 50%. In the three and a half years that I was at Texas Tech, tuition increased by 68%. These are rapid changes to the cost of college, and we have limited options in how we can absorb these rapid cost increases. As a financial planner, it’s important for me to understand these changes and use the relevant data to help me assist my clients with their goals.

I’ve spent that last few days researching and analyzing historical tuition data for North Carolina State University (NC State), Texas Tech University and Duke University. I’ll warn you that the results of these data may seem overwhelming, but it’s important to understand what the historical changes in tuition costs have been as we go through the college planning process.

This first set of data relates to the total percentage change in college tuition during three different time periods. The first time period is the 1981-’82 academic year through academic year 2011-’12. This data point was examined so that I could have a 30 year history of tuition changes and gain a long term perspective on tuition increases. The next period is the academic years 1994-’95 through 2011-’12; this time period represents the increase in tuition costs for an 18 year old who is part of the incoming freshman class of 2011. The final academic time period is 2008-’09 through 2011-’12, and this represents the change in tuition that has occurred for the graduating seniors in May 2012 (assuming a four year undergraduate curriculum). Chart 1 reflects the total percentage change for the three universities during these time periods. Graph 1 highlights the changing values of tuition at Texas Tech and NC State, while Graph 2 shows the changing tuition values at Duke and Stanford.

University

Total % Change

’80/’81 – ’11/’12

Total % Change

’94/’95 – ’11/’12

Total % Change

’08/’09 – ’11/’12
NC State

1,104%

343%

33%
Texas Tech

1,982%

385%

29%
Duke

903%

154%

5%
Chart 1: Percentage change in tuition

 

Graph 1: Change in Tuition at NC State and Texas Tech University since 1980-’81 to 2011-’12

 

Graph 2: Change in Tuition at Duke University and Stanford University since 1980-’81 to 2011-’12

After I calculated these rather striking numbers, I then calculated the percentage change from year-to-year using the 1981-’82 academic year as my starting point. Once I calculated the percentage change in tuition from year-to-year, I took a simple arithmetic average to calculate the average annual percentage change for these three periods of time. This helped to bring these numbers into perspective. If we know the average annual increase in tuition, we will have a better idea of what the targeted annual return for education accounts will need to be. Chart 2 details the average annual percentage change for the three universities.

University

Avg. Annual % Change

’80/’81 – ’11/’12

Avg. Annual % Change

’94/’95 – ’11/’12

Avg. Annual % Change

’08/’09 – ’11/’12
NC State

9%

9%

10%
Texas Tech

11%

10%

9%
Duke

6%

5%

5%
Chart 2: Average annual percentage change in tuition

The striking thing to me about these results is that the 30 year average annual return is relatively close to the two other time horizons. Since we have the average annual rate of  increase in tuition, we can see for a public university the education account would need to average an annual return between 9% and 10% to keep up with an average level of tuition hikes. I would consider this to be a very aggressive target to maintain, especially since we’ve seen a high level of market volatility impacting investment returns since 2008. Depending on your own experiences and risk tolerance, you may not feel comfortable with this much risk in the education savings for your children. If you want to be more conservative in how this money is invested, you’ll need to plan for a higher monthly savings goal.

How much will you need to save to fund four years at a public university? This is going to depend on how old your children are and if there is any current savings you or family members have set aside for college. For a newborn, lets assume a 9% annual increase in tuition for the next 22 years (18 years until college, 4 years in college) the estimated total cost of tuition and fees for four years at NC State would be $151,400 and the estimated four year total for tuition and fees at Texas Tech would be $189,100. This is a steep investment in your child’s education, and I’m currently only using tuition and fees in this example. Additional savings would be needed to cover text books, housing, food, clothes and all the other expenses that fall into a college lifestyle.

Now that you have the total estimated cost for tuition and fees, let’s break it down into the monthly amount of savings needed to save the total tuition cost by the time your child turns 18.  I’ve provided three different scenarios to show the impact savings and investing would have on the saving’s goal. The first scenario is if you didn’t earn any return on your savings. The second is if you saved in an account that generated an average annual return of 1% and the final scenario is if you invested the monthly savings in an account that averaged an annual return of 5%. This also assumes that you start saving the month your child is born. Chart 3 shows the necessary monthly savings needed to reach this goal based on the three variable different return scenarios.

University

Monthly Savings with 0% Avg. Annual Return

Monthly Savings with 1% Avg. Annual Return

Monthly Savings with 5% Avg. Annual Return
NC State

$701

$640

$434
Texas Tech

$876

$800

$542
Chart 3: The monthly savings required based on three different assumed average annual returns.

As you can see, the impact of the return on your investments will certainly factor into the amount needed to save to cover four years of college. Another factor will be as your children get closer to college age, the account would probably be invested more conservatively to help limit the impact of a major market downturn before your child gets ready to attend college.

Hopefully, you’re still with me and not feeling financially doomed. I would like to think that we’ll reach a level where tuition will flatten out and we will no longer see these continual tuition hikes. I feel that as a member of the financial planning industry, I need to be doing more to research the underlying issue of why tuition keeps increasing and helping to find solutions and alternatives to alleviate this trend of ever-rising tuition. I certainly don’t want to see that the ability families to send their children to college is out of reach and I’ll be doing my best to provide insightful and meaningful research and solutions to this conversation.

I’m hoping that in the coming months as I do further research, I’ll be able to provide you additional information on what is contributing to the ever-increasing cost of college. I can tell you currently, we see part of the tuition hikes needed as state legislatures reduce funding for higher education. We’ve also seen the expansion of campus construction for new academic buildings, athletic complexes and parking garages factor into the increasing costs of running a university, and this is more than likely contributing to tuition increases as well.

If you find yourself needing some guidance on developing your education goals and savings strategy, pick up the phone and call me at 919.695.3007 so we can have a frank discussion of where you are today financially and how I may be able to help you and your family reach your education goals.

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Let’s talk about life…insurance

Posted on September 7, 2011 by Chris

The other day I was having a conversation with a friend, and he asked if one would ever need two life insurance policies. I answered him, as I often answer most questions related to finances, it depends. I’m going to address two issues that this question raises. The first, is my insight into why I often reply, “It depends” when asked about a financial question. I’ll also address some of the factors that might encourage one to look at purchasing multiple life insurance policies and how this simple question can become much more complex very quickly.

To the first point, the “it depends” response is based on the fact that the financial needs and resources of each person, family and business are different. Financial planning isn’t designed to be a series of fill-in-the-blank questions that provide you with a generic answer. Financial planning is designed to be a dynamic and engaging process where the client and advisor are able to have an ongoing dialogue to discuss each client’s unique circumstances, feelings, cash flow and goals in order to create personalized recommendations that make sense for the client. The plan may even need to be adjusted as circumstances in your life change, and the dialogue is important to help your plan be adjusted as necessary. You certainly wouldn’t want your physician to prescribe you medication or treatment based on a limited conversation, so why would you want to seek financial advice based on a limited conversation and limited set of information?

A simple answer never gives you the fair thought, consideration and response your question needs and you deserve. In other words, by just generically answering your question, I’m probably not providing any meaningful advice or information to you.

For the initial question that was asked, “Would one ever need multiple life insurance policies?”, the answer is certainly and many people carry multiple life insurance policies. The reasons that drive this need for multiple life insurance policies is related to the circumstances of each individual’s life, financial situation and personal desires. One of the issues that factor into the search for additional life insurance stems from the level of insurance you currently have and if it will provide the level of support you desire.

You may currently only have life insurance that is offered through your employer, and it isn’t enough to provide the level of support you would like. For example, you already have an existing life insurance policy, but it won’t provide the level of coverage you’d like now that you’ve started a family. Or, you have a term life insurance policy that you realize may need to be continued, and you’re not sure if you could qualify for competitive rates when you’re in your 50’s or 60’s. These are just a few of the questions that go into the process of reviewing life insurance needs, and there are certainly many other questions and issues you’ll need to consider when thinking about life insurance coverage. I haven’t even touched on which type of insurance policy you may want and the variations between them. As you can see, this simple question has turned into something much more in depth than a simple yes or no answer.

Vaughan-Brown Wealth Management, LLC is set up as a fee-only financial planning firm. This means that we do not receive any type of commission based on our recommendations or for the implementation of the recommendations and suggestions we provide you. Part of our financial planning process is to work with you through a life insurance needs analysis and help you determine the pros and cons of the coverage you have in place. We discuss the current level of coverage and if it may make sense to pursue additional coverage, replace coverage and even if you want to consider canceling some coverage. Since we don’t receive a commission on the recommendations we provide you, you’re able to have a higher level of comfort knowing that your best interest is driving this discussion and not a sales agenda.

Interested in learning more about the financial planning process? Contact my office and set up an introductory meeting. You can reach me at 919.695.3007 or by email at chris@vbwealth.com

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A Reason to be Optimistic

Posted on September 2, 2011 by Chris

A few weeks ago I had the opportunity to volunteer with several of my peers and a group of Duke University students. The project we worked on was to shovel and spread mulch on church grounds. Luckily, the weather was nice that day and the humidity was relatively low. We were able to move a large amount of mulch that morning, but more importantly that experience left me with a renewed sense of optimism about our future. I want to share with you my part of this experience.

I am an optimist, and I always try and see the best in every situation. During the past three years, the economic climate has certainly made it a bit harder to keep my optimistic outlook, but I continue to believe that we’ll see the economy recover, unemployment drop and a sense of relief shared across the global economy. How long will this take? I don’t know. I’d prefer it to happen much sooner, rather than later, as we all do. In the meantime, I look for signs of encouragement and inspiration outside of the daily stock market returns, and this volunteer opportunity provided this experience.

The week before Duke students begin their fall classes, they have the opportunity to come to campus early and create new bonds with fellow students and within the Durham community. We had eight student volunteers, five freshmen and three upper classmen. These eight students came from a variety of backgrounds and regions of the country. For this week, they were working together because they all shared a common bond of wanting to be involved in their new community through volunteer work.

I was impressed by their willingness to work together and amazed by the skills they were all able to share with each other as the morning and afternoon progressed. As the mulching went on, I learned that in the evenings the group would gather and share stories of where they grew up and the challenges and dreams they had already encountered and accomplished. They all came from different places as strangers and will leave this weeklong experience as friends. After moving into their freshman dorms they’ll know that at least seven friendly faces on campus.

The sense of optimism I had came from seeing how these students, who carried themselves in a professional and courteous manner, would be the next generation of government leaders and CEOs. I can see that when these young achievers put their minds to the task, they will certainly be innovative and have tremendous accomplishments in the years ahead. By working together with people they never would have had met otherwise, they are building the crucial skills needed to help resolve conflict and developing a respect for the opinions of others.

I know that other colleges and universities have similar programs in place. As you see your children or grandchildren head off to college, encourage them to find out if an opportunity like this exists and encourage them to be involved. The freshmen students were able to learn their way around the campus, the new city they’d be spending at least the next four years of their lives in and more importantly they were able to make some of their first campus friends. The benefit to the other classmen is they were able to share their experiences with the newest class of freshmen and provided an opportunity to build their own leadership skills.

If your child’s university doesn’t have a program in place, encourage your children to lobby the campus administration and student government to create a program. For those of us who have been out of college a few years, find a way to volunteer with these students so you can see firsthand the potential that the latest generation of young leaders have. Hopefully, you’ll catch the optimism, like I did, that these young minds provide us.

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Creating Your Wealth Statement

Posted on August 19, 2011 by Chris

It was another turbulent day on Wall Street, and I certainly want to acknowledge the fear and uncertainty you may be feeling. My thoughts haven’t altered from my earlier blog, so please feel free to read through that for my thoughts on market turbulence.

Rather than focus on the latest wrench in the global economic recovery, I want you to go through a process with me. I want you to take a few minutes today to create your Wealth Statement. I’ve adapted my own Wealth Statement to help me focus not on building wealth, but on how I wish to live my life. My Wealth Statement helps me keep the world in perspective and filter out the noise that can otherwise be distracting.

We all see wealth in different ways and it’s important to remember this as you create your Wealth Statement. Some may see wealth as being able to retire at 50, some may see it as owning a Porsche and others may see it as time spent with friends and loved ones. While Merriam-Webster defines wealth as “abundance of valuable material possessions or resources”, I see wealth beyond that.  I see wealth as the people, and events that bring happiness and fulfillment to our lives, with material possessions and resources as a tool to help us further enhance this experience, but not necessarily the key to being wealthy.

My Wealth Statement is “To live each day to assist those in need through volunteering and charitable giving. To always work relentlessly and in the best interest of the families and businesses that have shared their aspirations with me. To be the best husband, father and son that I can be – and understand that I can’t be perfect at all three, all the time.”

My Wealth Statement isn’t tied to reaching any designated financial goal, but to help me pursue my passion of helping others, whether it be through serving meals to the needy, shoveling mulch at church or helping businesses and families map their way to success. My fulfillment in life isn’t tied the daily performance of the stock market, but to the actions that I can control and take each day. This Wealth Statement helps me see past the short-term ups and downs of the market and keep my focus on the things that are important in my daily life and to my long-term goals. It challenges me to rethink and review recommendations and look for possible deviations that will need to be addressed. It keeps me grounded so that I can have more meaningful relationships with the people that are seeking my advice and recommendations.

What I want you to do now is to think about what is important to you today. Will this same thing be important to you in ten years or twenty years? If it is, start to think how this adds wealth and fulfillment to your life. How does your job, savings and spending tie into these important goals and desires? If the items that are important to you today won’t be important to you in ten or twenty years, what is going to change that no longer makes them important to you? Do you need to focus on them as much today or find other ways to focus your time and energy?

Going through this process will help you realize the things that are truly important to you not just today, but for your long-term fulfillment as well. Write down and commit your Wealth Statement to memory. When you’re frustrated at work, disgusted by politics or feeling panicked about the stock market, come back to your Wealth Statement and look for it to give you the resolve and guidance to stay the course. You’ll know that fulfillment in your life is able to come through other means and that a few bad weeks of portfolio returns, will likely be insignificant in ten or twenty years.

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