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Laurie D. Renchik, CFP®, MBA

International Women’s Day Celebration Challenges Women to Find Their Tribe

Laurie Renchik Contributed by: Laurie Renchik, CFP®, MBA

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The Center team recently commemorated International Women’s Day by hosting a gathering in Southfield to celebrate and support women’s achievements in our community and throughout the world.

In keeping with the theme of building personal and professional networks, over 150 attendees enjoyed networking opportunities before and after the keynote delivered by Joscelyn Davis, Founder and President of Jade Strategies.  Ms. Davis inspired her audience with personal stories and research-based strategies for visionary women who want to advance and lead.  Acknowledging that barriers exist, Ms. Davis provided fresh ideas and easily implemented action steps to help women cultivate a tribe of trusted advisors, mentors, and colleagues.

Aligned with the keynote message, The Center has a long history of supporting women in leadership roles.  In fact, two of our three founding partners are women, as are three of our five current partners.  Statistics bear out that women have very few role models at the top, and we are proud to be an exception to the rule!

Understanding the challenges women face is a worthy endeavor, and we wholeheartedly thank all those who joined us for our International Women’s Day celebration here in Southfield, Mich

Laurie Renchik, CFP®, MBA is a Partner and CERTIFIED FINANCIAL PLANNER™ at Center for Financial Planning, Inc.® With 20 years of industry experience, she specializes in proactive retirement planning and helping clients assess risk in their portfolios.

Raymond James is not affiliated with nor endorses Joscelyn Davis and/or JADE Strategies.

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Sustainable Investments and Your Portfolio

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Laurie Renchik Contributed by: Laurie Renchik, CFP®, MBA

Planning for a sustainable retirement is one that will financially support you for a lifetime. The financial planning process is dynamic as life unfolds and is subject to new information and changing circumstances along the way. 

One of the changes I see happening today is that a growing number of retirement savers are thinking more seriously about how a sustainable investment strategy fits into their overall investment plan. 

In tandem, the sustainable investment landscape is also evolving and growing.  Once a niche market, sustainable investing is becoming mainstream moving from a limited universe of investments focused on screening objectionable exposures to a range of solutions to achieve sustainable outcomes.  In fact, US investments focused on sustainable objectives grew 135% in the four year period from 2012 through 2016.**  With this volume of growth comes opportunity.  Demographic shifts, government policies and corporate views on environmental and social risk are the primary forces driving growth and change today.

For example, sustainable investing today includes Exclusionary Screens, ESG factors and Impact Targets.  Exclusionary screens avoid exposure to companies who operate in controversial sectors such as fossil fuels, tobacco or weapons.  ESG Factors invest in companies whose practices rank highly by Environmental, Social, and Governance (ESG) performance standards.  Impact Targets invest in companies whose products and solutions target measurable social or environmental impact.

If your goal is to create a sustainable retirement and in tandem allocate a portion of your investments to supporting a sustainable global future we can help. 

Our top priority is to create the best plan coupled with the best investment portfolio for you.  If that means taking sustainable investment preferences into consideration we have the resources and solutions available to build on traditional portfolio analytics to understand your current exposures and relevant sustainability factors.  We can set targets to improve the sustainability of your portfolio based on your personal objectives and measure performance data over time.

Contact us today to learn more!  Sustainable investing can drive positive social or environmental impact alongside financial results, allowing investors to accomplish more with their money.  Opportunity awaits.

Laurie Renchik, CFP®, MBA is a Partner and Senior Financial Planner at Center for Financial Planning, Inc.® In addition to working with women who are in the midst of a transition (career change, receiving an inheritance, losing a life partner, divorce or remarriage), Laurie works with clients who are planning for retirement. Laurie is a member of the Leadership Oakland Alumni Association and is a frequent contributor to Money Centered.

**Year over year growth in sustainable assets in the U.S. 2012 to 2016. Source: Global Sustainable Investment Alliance. Views expressed are not necessarily those of Raymond James Financial Services and are subject to change without notice. Information contained herein was received from sources believed to be reliable, but accuracy is not guaranteed. Information provided is general in nature, and is not a complete statement of all information necessary for making an investment decision. Past performance is not indicative of future results. There is no assurance these trends will continue or that forecasts mentioned will occur.  Investing always involves risk and you may incur a profit or loss. No investment strategy can guarantee success.

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International Women’s Day Celebration with The Center

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On behalf of The Center team we want to thank everyone who participated in our First Annual International Women’s Day event!  The energy in the room of 200+ women on March 8th was an inspiration sure to carry on throughout the year.  Celebrating women’s success and making a difference in other women’s lives carries a message of community and mutual support; a WIN-WIN with staying power.

Our keynote presentation by Laura Vanderkam was a gift of wisdom and practical application as she helped us understand how to focus on aligning our time with priorities.  Before, during and after the presentation it’s no surprise that networking conversations were abundant from start to finish.  A truly remarkable exclamation point on the morning was the generous spirit in which financial donations were made for Haven’s Spark program. 

DONATION RESULTS

An amazing result for Haven’s Spark program:

$5,295 (so far!)

RESOURCE DIRECTORY

Networking connections are an essential ingredient to success.  If you have not already reached out to new connections we are happy to provide this resource directory of the companies and organizations who were participants in our Women’s International Day event.

KEYNOTE TO-DO LIST LINK

Laura’s advice hit home as evidenced by all of the head nodding going on in the room!  If you missed the link to our “more balanced life” To-Do list click here to open your personal copy!

PHOTO GALLERY

Smiles and memories of our time together at The Center sponsored Women’s International Day event. Click to view.

SAVE THE DATE 

Plan to celebrate International Women’s Day with us again next year on Friday March 8th 2019!  You can mark your calendar and we will take care of all the details!  

IN CLOSING

Women celebrating women is one example of pooling resources around a common goal.  We are grateful to have so many professional connections and women advocates in our circle of friends.  In our world of financial planning, it is not uncommon to work with accomplished women who are seeking guidance to ensure that their present plan for financial security is on track for future success.  One hurdle is that many times they don’t know someone …… consider that we might be that someone!

Laurie Renchik, CFP®, MBA is a Partner and Senior Financial Planner at Center for Financial Planning, Inc.® In addition to working with women who are in the midst of a transition (career change, receiving an inheritance, losing a life partner, divorce or remarriage), Laurie works with clients who are planning for retirement. Laurie is a member of the Leadership Oakland Alumni Association and is a frequent contributor to Money Centered.

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Tax Reform Series: Changes to the Mortgage Interest Deduction (including home equity loans/LOC implications)

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The Tax Cuts and Jobs Act (TCJA) is now officially law. We at The Center have written a series of blogs addressing some of the most notable changes resulting from this new legislation. Our goal is to be a resource to help you understand these changes and interpret how they may affect your own financial and tax planning efforts.

Washington has been busy and after many twists and turns sweeping tax reform was signed into law on December 22, 2017.  There are key changes for homeowners regarding the mortgage and home equity line of credit (HELOC) interest deductions.

Mortgage

If you own a home, mortgage interest is still deductible. The debt cap of deductibility, however, has been lowered.  The new cap limits interest deductibility to the first $750,000 of debt principal.  Debt principal refers to acquisition indebtedness or loans used to acquire, build, or substantially improve a primary residence.  The new $750,000 cap is a reduction from $1,000,000 and an additional $100,000 of home equity debt. 

  • The reduction to $750,000 expires December 31, 2025 and reverts back to $1,000,000 beginning in 2026.

  • Mortgage debt incurred before December 15, 2017 is grandfathered under the $1,000,000 cap

  • In the future, a mortgage refinance for debt incurred prior to December 15, 2017 will retain the $1 million debt limit (but only for the remaining debt balance and not any additional debt). In addition, any houses that were under a binding written contract by December 15th to close on a principal residence purchased by January 1, 2018 (and actually close by April 1st) will be grandfathered.

Home Equity Line of Credit (HELOC)

Home equity lines of credit give homeowners the ability to borrow or draw money using equity in the home as collateral.  New restrictions mean that home equity loan interest is not necessarily eligible for a deduction. 

While you may have read that interest on HELOC’s is no longer deductible, this is only if the loans are cash out or for purposes other than home purchase or improvement.  It’s important to note that deductibility is not based on whether the loan is a home equity loan or home equity line of credit. Instead, the determination is based on how the proceeds are used.

  • If the money is used to consolidate debt, pay for college or used for any other personal spending not associated with home acquisition or substantial improvement, the interest is not deductible; without grandfathering.

  • Interest on a HELOC up to the total $750,000 cap that is used to build an addition or substantially improve the home is deductible for taxpayers that itemize.

We are here to assist in any way we can.  This summary of mortgage and HELOC interest deductibility changes highlights key areas to keep in mind for 2018 tax planning.  If you have any questions regarding your personal situation, don’t hesitate to contact us.

Laurie Renchik, CFP®, MBA is a Partner and Senior Financial Planner at Center for Financial Planning, Inc.® In addition to working with women who are in the midst of a transition (career change, receiving an inheritance, losing a life partner, divorce or remarriage), Laurie works with clients who are planning for retirement. Laurie is a member of the Leadership Oakland Alumni Association and is a frequent contributor to Money Centered.

The information contained in this blog does not purport to be a complete description of the securities, markets, or developments referred to in this material. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Laurie Renchik and not necessarily those of Raymond James. Expressions of opinion are as of this date and are subject to change without notice. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct. This material is being provided for information purposes only. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Please note, changes in tax laws may occur at any time and could have a substantial impact upon each person's situation. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors of RJFS, we are not qualified to render advice on tax or legal matters. You should discuss tax or legal matters with the appropriate professional. Raymond James Financial Services and your Raymond James Financial Advisors do not solicit or offer residential mortgage products and are unable to accept any residential mortgage loan applications or to offer or negotiate terms of any such loan. You will be referred to a qualified Raymond James Bank employee for your residential mortgage lending needs.

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A New Season: Empty-Nesters

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This year the fall season took a different turn than the past eighteen and it wasn’t associated with the weather.  My youngest child was college bound for his freshman year.  How did that happen?  It was a mad rush from high school graduation festivities in June to college move in day in August.  The reality of an empty nest began to set in as my husband and I drove home leaving our son to settle into his new digs.  Our conversation took many expected turns reminiscing about the past and looking forward to the future.  

This new chapter we surmised was as an opportunity to put some additional focus on our life goals including a “catch-up” sprint to shore up retirement savings. More questions than answers surfaced.  Should we downsize, take a big trip, save more, spend more, double up on mortgage payments, or put a finer point on our expectations for the future?  Perhaps you can relate to this milestone in life. 

The following Empty Nest Checklist can help to organize thoughts and prioritize action steps:

  1. Revisit the big picture.  Make time to talk about lifestyle changes you’re thinking about, along with their financial impact. Think of it like a test drive for your retirement years. While you are at it, give your financial plan a fresh look. Celebrate successes, clarify goals and identify potential gaps.

  2. Consider your finances.  Updating your monthly budget is a good first step.  Putting money you were using to support children toward larger financial goals like paying down your mortgage and boosting retirement savings may be an option with surprising benefits.

  3. Review investments.  The status quo may not meet your future needs.  Your financial advisor can help with a review of retirement savings accounts.  Learning how your savings can generate income in retirement helps financial decision making during this new chapter. 

  4. Update your goals and need for insurance.  The bottom line is to make sure that existing insurance policies still make sense for your situation.  If your mortgage is paid off and dependents are now independent you may want to reassess your coverage.

Goals change at every stage of life, so regularly reviewing your plans is an important step. Revisiting the basics can build confidence as you plan for tomorrow. Reconciling your next steps as empty nesters is essential to enjoying all that is to come. Don’t forget to celebrate each milestone you’ve achieved along the way and put in place a plan for what comes next.

Laurie Renchik, CFP®, MBA is a Partner and Senior Financial Planner at Center for Financial Planning, Inc.® In addition to working with women who are in the midst of a transition (career change, receiving an inheritance, losing a life partner, divorce or remarriage), Laurie works with clients who are planning for retirement. Laurie is a member of the Leadership Oakland Alumni Association and is a frequent contributor to Money Centered.

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Adjusting the Secret Sauce in your Financial Plan

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Investing in your financial future is a journey that doesn’t start or stop at retirement. Creating financial independence to support your future is a work in progress practiced over a lifetime. While it is reasonable to assume that the approach for a 35-year-old may not be appropriate for a 55-year-old, there is a common thread that emerges regardless of age. As priorities shift and circumstances change, financial plans and investment portfolios need periodic adjustments to stay in sync with your life. If your life journey is anything like mine, some plans work out perfectly and others may require course corrections to stay on track. I have found that the secret sauce is not just THE financial plan; but rather the consistent financial planning process along the way.

Let’s consider a 55-year old with a plan to retire in five years at the age of 60. In this transition period, the focus is shifting from saving and accumulating to preparing to withdraw income from retirement accounts; commonly referred to as the distribution phase. Having the confidence to retire without worry of spending down the nest egg too quickly is a common concern for folks in this transition phase. Sustaining the nest egg especially in the face of events that are beyond control—like market corrections, changing economic backdrops, and business cycles—are why financial plans and investment management go hand and hand.

I have found that considering a range of “what-if” scenarios in order to address concerns before retirement is a productive approach to addressing an unknown future that could unfold during your retired years.

  1. Market corrections:  In the early years of retirement, a portfolio that goes down in value during a market correction may suffer initially and cause stress for the recent retiree.

    ACTION: Don’t panic. When things go in directions we don’t like, the natural inclination is to take action. To avoid a reactive response, start out with a properly diversified portfolio which includes appropriate asset allocation, ready cash on hand to support income needs, as well as a process for monitoring the big picture. Review your plan for confirmation.    
     

  2.  Inflation is higher than expected: With inflation, things cost more over time eroding the value of savings especially when considering a 30 or 40-year retirement.

    ACTION: We don’t know how much inflation will spike or fall in the future. Model a range of scenarios in your baseline income assumptions to understand the potential impact. Revisit the areas of rising costs in your plan as part of your review process. Your financial plan should be built to withstand uncertainties.
     

  3. Lower than anticipated market returns: A plan that is monitored consistently and customized to your long-term retirement goals can include the analysis and financial independence calculations to easily take into consideration lower than expected returns. 

ACTION: Build in a margin of safety in your baseline assumptions as a buffer to absorb the impact of lower than expected market returns. Put yourself in the best position to achieve your goals by prioritizing in advance where you can make incremental changes so that clarity and purpose are fundamental to your decision. 

Life has a wonderful, unpredictable way of introducing lots of sticky details into the mix. Your financial planner can help with the details and changes needed to take care of your nest egg by working with you to adjust the secret sauce as needed along the way.

Laurie Renchik, CFP®, MBA is a Partner and Senior Financial Planner at Center for Financial Planning, Inc.® In addition to working with women who are in the midst of a transition (career change, receiving an inheritance, losing a life partner, divorce or remarriage), Laurie works with clients who are planning for retirement. Laurie is a member of the Leadership Oakland Alumni Association and is a frequent contributor to Money Centered.

Asset allocation and diversification do not ensure a profit or guarantee against loss.

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The Center's Day of Creative Giving

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There are many ways to give time, talent and resources through volunteering.  Recently, a group of Center clients, friends, and team members came together with energy and purpose to lend a hand for an afternoon of Creative giving.  The goal was to make 125 care packages for children who are experiencing a stay at C.S. Mott Children’s Hospital in Ann Arbor.   We reached our goal and hope that the goody bags will bring smiles to the faces of children receiving care at C.S. Mott.

Handmade cards decorated the outside of the packages. Volunteers filled the bags with snack items, huggable stuffed animals, coloring books, and puzzles. The smiles were abundant, and the sense of purpose created a positive vibe for all.  

The Center Charitable Committee, Creative Committee, and team members all pitched in to help with the planning and set up.  Clients and friends of the Center came together in support and created a multitude of brightly colored Care Packages filled with tangible items and a sprinkle of love and caring. 

In the words of Oprah Winfrey; “I don’t think you ever stop giving.  I really don’t.  I think it’s an ongoing process.  And it’s not just about being able to write a check.  It's being able to touch somebody’s life.”

Thanks to all that contributed to the success of our “Creative Giving” day!

Laurie Renchik is a partner and Certified Financial Planner™ at the Center for Financial Planning, Inc.®

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5 Steps for When You're in the Retirement Home Stretch

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It’s the home stretch! Important retirement decisions during the five to ten years before you leave the workforce can easily create more questions than answers. Dropping to the bottom line, one way to describe retirement readiness is getting in step with financial and lifestyle matters before you stop working. 

What to do? Start with the big picture and think about what the ideal retirement looks like for you. Maybe you have already dropped to the bottom line and have a preferred timeframe in your sights. Either way, below are five steps to help.

Five Fundamental Steps to Help Guide Decisions Leading Up to Your Retirement Day:

  1. See When You Can Realistically Retire
    It’s not a simple decision. Start with getting a general idea about out how much money you’re likely to spend each year. Some expenses drop off like payroll taxes, retirement savings, and potentially mortgage debt. Additional expenses may surface like extended travel, bucket list items, or higher than average health care costs.

  2. Make a Plan to Pay Off Your Debt
    While you are still working, review all outstanding debt. Personal loans, student loans, and credit cards tend to have higher interest rates. Make a plan to pay these off before you retire. Now is also the time to find the balance between putting “extra” on the mortgage and funding retirement accounts. Your financial planner and CPA can help with these decisions.

  3. Run the Numbers to Understand Where You Stand Today
    This is your opportunity to see how close you are to your potential retirement goal and what changes you might need to make. An annual review with your financial planner will help chart progress, identify gaps, and create solutions.

  4. See How Retirement Age Affects Social Security Benefits
    Some people are inclined to begin receiving Social Security as soon as possible, even if it means reduced payouts. For planning purposes the best decision depends on many variables including health, wealth, tax situation, and life expectancy. Understanding the impact to your retirement plan is a big part of making the decision when to draw those benefits.

  5. Keep Your Plan on Track
    Now that you are hitting the final stretch it is time to give your retirement savings all that you can.  Ramping up for the next ten years will make a big difference. 

You are almost there! Candidly thinking through your options and taking your plan to the next level is sure to help you hit your retirement mark in good stride. But if you need help along the way, please reach out to us or your Financial Planner for guidance.

Laurie Renchik, CFP®, MBA is a Partner and Senior Financial Planner at Center for Financial Planning, Inc.® In addition to working with women who are in the midst of a transition (career change, receiving an inheritance, losing a life partner, divorce or remarriage), Laurie works with clients who are planning for retirement. Laurie is a member of the Leadership Oakland Alumni Association and is a frequent contributor to Money Centered.

Opinions expressed are those of Laurie Renchik and are not necessarily those of RJFS or Raymond James. Every individual's situation is unique; please consult with a financial professional before making any investment decision.

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How to Get on the Same Financial Page

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If I told you that over 40% of couples don’t know how much their partner earns, would you believe it? The Couples Retirement Survey recently published by Fidelity Investments revealed that this statistic is in fact true. My first thought was, “how can this be” and a close second was “what’s the best way for folks falling in the 40% to get in sync financially?”   

Here are 5 straightforward questions to help get the conversation started.

Getting to the answers may not be easy especially if there is no centralized management in the household. Ready – set – go!

  1. Do we have any financial secrets? Talk about debt, obligations, past mistakes and what you learned. Are you a spender or a saver? Develop a shared vision for the future.

  2. How much do we earn? Include bonuses in your discussion and consider your future career goals and earning potential as well. 

  3. What’s our budget? Do you know your cost of living? Is it above your means or below? Create and maintain a budget together.

  4. What do we own and what do we owe? Take an inventory or your collective assets and liabilities; property, insurance policies, bank and retirement accounts—anything that involves money.

  5. How much are we saving for retirement and where are the accounts? Keep track of your 401(k)s, including those from previous jobs; IRA’s and other accounts dedicated to retirement savings. How much are you contributing and whose name is on each?

The preceding five questions are conversation starters. Want to get started? Set a date to talk money using these questions as a starting point. Compile all of your account numbers and passwords in a secure place for easy reference and share with your partner. Schedule time with your financial planner to review your progress and strategize for a more complete understanding of your financial status as a couple which is crucial to planning, budgeting and saving toward future goals.

Laurie Renchik, CFP®, MBA is a Partner and Senior Financial Planner at Center for Financial Planning, Inc.® In addition to working with women who are in the midst of a transition (career change, receiving an inheritance, losing a life partner, divorce or remarriage), Laurie works with clients who are planning for retirement. Laurie is a member of the Leadership Oakland Alumni Association and is a frequent contributor to Money Centered.

This information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete.

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Financial Planning: Creating a Road Map for your Future

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Setting the stage for a comfortable retirement can start with your first paycheck and continue through every stage of life. Whether you are at the beginning of your career or well on your way to reaching financial goal milestones, one of your options along the way is to develop a relationship with a financial planner.

Why partner with a financial planner?

When you establish a relationship with a financial planner you start with a customized financial plan and pair it with ongoing investment advice. That way the plan leads investments rather than the opposite. By pairing a plan—informed by long term goals—with your investment strategy, investment decisions are based on you rather than a starting point of past performance or beating the market. 

If we could simply lay out a plan, set it on autopilot and land on time at our destination it would take all of the financial wondering and stress out of planning for the future. Life, however, is no ordinary journey from point A to point B; it is likely that unexpected turns happen at the most inopportune times. Turns like career changes or getting close to retirement are inflection points in life where your financial planner can make a big difference. 

I have found that the most successful financial planning relationships are focused on real life advice, in real time managing change as it happens. Looking forward helps allows for a more proactive approach, reducing the importance of relying on the rear view mirror for perspective. While it may be tempting to start with investments and lay out your plan later, it is not a complete solution. Without financial planning investing alone may not produce the results you are counting on. 

Here are my top three route changers that can add value in your journey with a financial planner:

  1. Financial planning doesn’t mean planning for the day your health begins to fail; it means asking where do I want to be in three years? Ten years? Twenty years?

  2. Steer your financial plan by making investment decisions based on your goals and current circumstances. It may be tempting to jump straight to investments. Resist the temptation for a more focused journey.

  3. Tracking your progress through every stage of life is an effective accountability check and helps increase the likelihood of reaching your destination on time and prepared.

So whether you’re beginning your financial journey or nearing a big inflection point, feel free to call us and ask how we can help create a plan and map out your future to better align your investments with your goals.

Laurie Renchik, CFP®, MBA is a Partner and Senior Financial Planner at Center for Financial Planning, Inc.® In addition to working with women who are in the midst of a transition (career change, receiving an inheritance, losing a life partner, divorce or remarriage), Laurie works with clients who are planning for retirement. Laurie is a member of the Leadership Oakland Alumni Association and is a frequent contributor to Money Centered at The Center.

The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Laurie Renchik and not necessarily those of Raymond James. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Every investor's situation is unique and you should consider your investment goals, risk tolerance and time horizon before making any investment. Prior to making an investment decision, please consult with your financial advisor about your individual situation.

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