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.
© 2024 Moneywatch Advisors . All rights reserved.
