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How will I help you understand my investment recommendations?

Posted by Shanna Tingom, AAMS® on Oct 26, 2017 6:05:41 PM

When it comes to investing I encourage people to be cautious. There are different types of investments that meet different goals so it’s important to ask questions and research the best options for your family and work with a financial professional you can trust.

At Heritage Financial Strategies, I want to help you understand my investment recommendations.

Let's start with why I am recommending a particular investment.

I want to answer the question of how it fits with your other investments, including employer sponsored retirement plans (401K, 403b) and other insurance policies. That’s why we talk about your current financial situation, short and long term financial goals, and your risk assessment survey. I want to have an understanding of your situation.

If you need this money, how easy is it to get to?

No one wants to think about a worst-case scenario but it needs to happen. You may not need access to the funds immediately but what if you have an emergency and need some or all of the money? If it is an Annuity, for example, you may have to tie up a significant amount of money for a significant period of time before you can cash it out.

This poses problems especially if you need that money for immediate expenses.

What will happen to dividends or interest that you earn?

Follow the cash to understand more about a business or mutual fund before investing.

They will save the money, reinvest into their organization, or pay out dividends. Most of my clients elect to have dividends reinvested to buy more shares of the investments they own. But you could also opt, in most cases, to take the dividends and interest as a payment. This is particularly helpful if you are counting on this income for retirement purposes.

What, if any, tax issues will this create?

Every investment move creates the potential for two things, taxes and fees. Will this investment help your tax situation or hurt it? If there are ways to achieve the same or similar results with fewer taxes, I’ll share those with you as well.

Speaking of fees, how do I, your financial advisor, get paid from this recommendation?

I will always clearly discuss what the costs and fees are with anything I recommend. Even if you don’t directly pay them. I always want you to understand this and I welcome any questions you have on this subject.

At Heritage Financial Strategies, we are dedicated to helping you understand my investment recommendations, associated fees, and tax implications.