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I attended an insurance seminar in Clearwater in February (a great time to visit Florida, right?).
Anyway, the trip resulted in two benefits. The first, I managed to fit in a bicycle ride across Georgia, culminating in sitting on a church pew where I heard President Jimmy Carter give his Sunday lesson. He is scheduled to deliver fewer of them this year, finally cutting back at age 93. In his hometown of Plains, a few residents still had up lawn signs that read "Carter for Cancer Survivor", a kind gesture first greeting him three years earlier when he returned from the hospital. Carter’s lesson my Sunday was unconditional love and caregiving, good one for the topic I’d like to describe for you next. For those who are getting older (aren’t we all?), at the insurance seminar I attended, I heard from Dr. Carolyn McClanahan a former emergency room doctor who has since changed careers to become a financial planner focusing around the life stages of aging. She created an online toolkit, Whealthcare, together with Dr. Chris Heye, and in cooperation with Dr. Anthony Weiner, Director of Outpatient Geriatric Psychiatry at Mass General Hospital. The idea is to complete planning before the need occurs, before a life-changing medical event, particularly the onset of cognitive impairment. Whether you can make this a part of your planning or you can recommend it to someone who could, I wanted you to know it’s available. I could also tell a personal story about how it’s helped my family.
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Why invest in individual stocks and bonds when most every financial adviser seems to be recommending passive mutual funds?
The other day, I bought for clients Florida municipal bonds that finance land preservation in that state, protecting the Everglades. The bonds were odd lots (considered any amount less than $100,000). A buyer of odd lots benefits, purchasing at a sizeable discount — the dealer is motivated to move these bonds off its own balance sheet. This isn’t a problem for us since our intention is typically to hold bonds to maturity. By buying at lower prices, we capture a performance advantage versus the investor who invests regardless of price. And isn’t that what investing is all about, investing to conserve what’s important while also earning a profit? Another example, we bought stocks this past quarter that had fallen in price for no good reason. Why? At the end of the year, investors sell losing stocks to realize their losses. They reduce their tax bills. This selling further depresses prices in these stocks. By buying some of them, we begin 2018 with a head start when it comes to value — these stocks were often penalized too much in relation to their merits. Good businesses may or may not make for good stocks. Much depends on their purchase price. In contrast, another rule of thumb must be mentioned. Bad businesses make for poor investments — these we avoid. Smart investing is about figuring out the difference, one from the other. |
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March 2023
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Integrity. In conversation. Prudent values.
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