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Financial Planning
To get where you want to go, you have to know where
you are and where your destination lies. While not everyone needs
a full-scale analysis, many can benefit from the Financial Review,
a comprehensive financial-planning service designed to add value
for our clients.
The Financial Review provides a detailed look at your
assets and how they might be used to reach your financial goals.
It’s designed to help increase cash flow and reduce taxes.
Our financial-planning specialists use information you provide—along
with a computer-assisted program that incorporates the latest tax
changes and financial-planning strategies—to produce the Financial
Review for you and your Financial Consultant. It’s the foundation
of your complete plan for long-term prosperity.
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Financial
HorizonsSM
One of the things long-term prosperity means today
is being ready, at age 65, to fund as much as 25 more years of comfortable,
active living. Our Financial Horizons program, the first program
designed specifically for retired investors, has been reviewed and
approved by The National Council on the Aging, Inc. It provides
a number of value-added services—a financial security analysis,
an income-tax review, a cash-flow analysis, an estate planning profile,
an annual financial checkup, a periodic newsletter, and more. Through
Financial Horizons, your Financial Consultant can help you plan
a secure retirement.
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Estate Planning
Even if you don't expect your estate’s value
(including death benefits from insurance policies) to total more
than $625,000, you may need an estate plan. Proper estate planning
can use lifetime gifts and trusts to minimize your estate-tax liability.
For example, without an estate plan, an estate of
$1.5 million might be charged $353,750 in estate taxes. A good plan
could reduce that charge to $95,000--for a savings of $258,750!
With the help of our Financial Planning Department,
your Financial Consultant can complete a comprehensive estate plan,
for you to review with your accountant and attorney.
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Strategy Plus
Offered exclusively to Investors Security clients,
our Strategy Plus program helps you and your Financial Consultant
develop the appropriate blend of asset classes for your overall
investment strategy.
The Case for Asset Allocation
With decades of market activity to analyze and hundreds
of studies to review, we now know the most important factor that
affects investment performance isn’t the ability to time the
market, anticipate global economic changes, or forecast investor
psychology. In fact, more than 90% of a portfolio’s performance
depends on a process known as asset allocation--the science of combining
the right categories of investments.
The concept was originally developed by Nobel Laureate
Professor Harry Markowitz of the University of Chicago. Large pension-fund
managers and other institutional investors have benefited from this
approach for years. Now individual investors are taking advantage
of this methodology as well.
What Drives a Portfolio?
- 4.6% Security Selection
- 2.1% Market Timing
- 1.8% Other Factors
- 91.5% Asset Allocation
Source: Brinson, Singer, and Beebower, "Determinants
of Portfolio Performance II: An Update," Financial Analyst
Journal, May-June 1991.
Diversification Is the Key
Strategic asset allocation begins with diversification--making
sure you don’t put all your money into one type of investment.
Regardless of the percentages, a strategically diversified portfolio
often includes a mix of:
- equity investments including domestic and
international stocks and stock mutual funds;
- fixed-income securities such as corporate, government,
or municipal bonds; and
- other investments including CDs and money markets.
These categories of investments are also known as
asset classes.
Investments Working Together
Different asset classes react differently to the same
changes in the world’s economy. The right mix is critical
because it doesn’t matter as much how one particular investment
performs, but how all of your investments perform together.
Diversifying your investments may reduce your portfolio’s
volatility. Of course, no strategy can guarantee against losses
in every conceivable investment situation.
When you take a strategic approach to investing, by
diversifying your portfolio and taking advantage of asset allocation,
you arm yourself with the tools of successful investors.
In Summary
When you work with an Investors Security Financial
Consultant, your Strategic Allocation Review may include:
- a recommended asset mix for your investments;
- a comparison of your existing portfolio to the
new portfolio
- proposed for you; and
- information on the potential returns and volatility
of your existing and proposed portfolios.
If you are interested in taking advantage of our Strategy
Plus investment process, talk with a Financial Consultant at the
Investors Security office.
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College Planning
Providing for your children's education, seeing them
achieve their potential and knowing the opportunities a good education
provides can give you a sense of satisfaction greater than any possession
can offer. But this should not mean sacrificing your other major
goals.
Balancing these goals can be a challenge.
How prepared are you to send your children
to college?
Investors Security offers many options to help you
achieve your college planning goals.
Average cost of public and private
colleges
College-funding ideas and investment solutions
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