Wednesday, October 9, 2013
According to a recent survey, only a third of Americans over age 50 could answer these three questions correctly:
- Suppose you had $100 in a savings account and the interest rate was 2 percent a year. After five years, how much do you think you would have if you left the money to grow? More than $102, exactly $102 or less than $102?
- Imagine that the interest rate on your savings account was 1 percent a year and that inflation was 2 percent. After one year, would you be able to buy more than, the same as or less than you could today with the money?
- Do you think this statement is true or false: “Buying a single company stock usually provides a safer return than a stock mutual fund”?
This lack of financial literacy is troubling given the complexity of our modern economy. One approach gaining steam is to include household finance in basic high school curriculum. However, a new paper by three business school professors concludes that financial education is not particularly helpful.
A viable alternative may include just-in-time education, which provides assistance right before a decision is made. Just-in-time education could help with student loans, mortgages, and retirement; however, those most in need of such help would be unlikely to seek it out.
Another approach is to develop simple rules of thumb that would help people cope with big decisions. Examples could include “invest as much as possible in your 401(k) plan” or “save 15 percent of your income.”
A third approach, and probably the most helpful, would be to make our current financial system more user-friendly. Making it simpler to choose a suitable mortgage, invest in 401(k)s, and use credit cards and checking accounts would have to help people make sounder financial decisions.
See Richard H. Thaler, Financial Literacy, Beyond the Classroom, The New York Times, Oct. 5, 2013.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
Monday, September 9, 2013
Last year, Warren Buffett alone gave away $3.084 billion to charity. Now, Buffett is teaching others how to follow in his footsteps and maximize charitable giving with his free online course, Giving with Purpose. One of the biggest takeaways from this course is a four-step process known as the RISE Framework for Social Change, which helps those wishing to give to decide whether a given charity merits their contribution.
- Relevance. Determine what motivates you personally to ensure your money will make a real difference.
- Impact. Make sure the money you are giving to charity as well as the time, skills, or outreach you are providing is going to an organization that actually has an impact.
- Sustainability. Invest in nonprofits that aren’t solely dependent on asking donors for more money.
- Excellence in Management and Operations. Observe the organization’s facilities, communications, and management to determine if the cause is being adequately addressed.
See Allison Kade, 4 Charitable Giving Tips from Warren Buffett, Forbes, Sept. 6, 2013.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
Tuesday, July 30, 2013
Now that the Labor Department has required 401k plans to report fees to retirement savers, Yale researcher Ian Ayres is planning to publish fund fees comparisons of thousands of 401k plans. Professor Ayres isn’t doing this merely for the sake of academia; he’s sending letters to “high cost” plan sponsors demanding they change their practices and offer low-fee products or end up being identified as “high cost” in his research.
This plan has the retirement industry up in arms with investor lawsuits and Congressional hearings soon to be expected. Afraid of this unwanted publicity, plan advisers are calling Professor Ayres’s tactics “harassment.” This reaction is understandable as a plan comparison would beg “the uncomfortable question of why high adviser fees don’t necessarily correspond to better performance.”
See Mitch Tuchman, Meet the Yale Prof Ripping the Lid Off 401k Fund Fees, Forbes, July 26, 2013.
Wednesday, July 10, 2013
The World Congress on Adult Guardianship is an unparalleled international gathering of guardianship advocates to examine problems from new perspectives and offer solutions from multiple viewpoints and cultures. Each World Congress offers opportunities to learn and collaborate by bringing together those involved in adult guardianship, as well as aging, disability and elder rights from around the globe. All participants bring a commitment to examine the best ways to shape guardianship systems so that they consistently treat vulnerable populations with dignity and respect.
Approximately 400 delegates, including academics, attorneys, court officials, judges, disability advocates, government officials, guardians, and fiduciaries from 20 countries have participated in previous Congresses.
The deadline is July 31 so submit now!
Thursday, July 4, 2013
The Nexus Global Youth Summit is an organization developed to educate and facilitate ultra-wealthy inheritors who want to make a significant difference in the world through social entrepreneurship, the process of developing creative solutions to social problems.
Started in 2011, Nexus holds summits at the United Nations in New York as well as Europe, China, Russia, and the Middle East. The goal of Nexus is to enable young philanthropically motivated individuals to better leverage their talents. Nexus is now in the process of developing workshops geared towards providing necessary financial information to these individuals and enabling wealth holders to more easily connect with social entrepreneurs.
See Russ Alan Prince, Nexus: Helping Ultra-Wealthy Inheritors Change the World, Forbes, June 24, 2013.
Saturday, June 22, 2013
Harold Evensky, President of Evensky & Katz Wealth Management, is renowned for his investment expertise as well as his core-and-satellite investment strategy.
Evensky recently answered ten questions posed by the Journal of Financial Planning concerning trends in investing. Please click here to learn how Evensky has changed his investing strategy, how he creates real cash flow for his clients, and what he’s currently teaching in the department of personal financial planning at Texas Tech University.
See Carly Schulaka, Harold Evensky on ETFs, Reverse Mortgages, and the Most Important Investment in the Coming Decade, Journal of Financial Planning, June 2013.
Thursday, June 20, 2013
Estate planning is a complex field requiring a breadth of knowledge in law, finance, and accounting fields. In addition to relevant advanced degrees, many certifications exist to bolster the credibility of an estate planner, which, in turn, hopefully improves their business.
The Chartered Trust and Estate Planner (CTEP) designation is certified by the American Academy of Financial Management and requires at least three years of experience in the estate planning field, an advanced degree, annual continuing education requirements, and over five approved courses.
The Accredited Estate Planner (AEP) designation is certified by the National Association of Estate Planners & Councils and requires at least five years of estate planning experience, a professional license, two graduate courses, and a minimum 30 hours of continuing education.
The Certified Trust and Financial Advisor (CTFA) designation is certified by the American Bankers Association and requires at least three years of experience in wealth management, a letter of recommendation, an ethics statement, and 45 continuing education credits every three years.
A number of additional certifications exist out there for the estate planner including a Chartered Wealth Manager, Asset Manager, Portfolio Manager, or Compliance Officer.
See Marv Dumon, Certifications for Estate Planning, Investopedia, June 5, 2013.
Sunday, May 19, 2013
Robert S. Keebler, Keebler & Associates, LLP, Green Bay, WI
Kristen M. Lynch, Fowler White Burnett, Ft. Lauderdale, FL
TextIt is currently estimated that there are over Five Trillion Dollars currently invested in Individual Retirement Accounts (IRAs) and that these assets comprise approximately 10% of all household financial assets. IRAs, and a staggering amount of tax-deferred employee benefit accounts (which are eligible at some point be rolled into the IRAs) now constitute a meaningful part of estate planning and post mortem planning discussions. Both IRA assets and plan assets are supposed to pass by way of beneficiary designation . . .and yet there is an ever-increasing number of situations in which the beneficiary designation does not appear to name the intended beneficiary, has some execution flaw, or has completely gone missing.
The purpose of this informative webinar is to provide some background on Federal and common State laws that impact IRAs and qualified plans, as well as contractual issues.
The speakers will discuss the types of beneficiary problems that can arise and will discuss various options and approaches towards correcting the problems or mitigating the damage caused, including:
- The impact of ERISA and REA on plan beneficiary designations;
- The deadlines after death within which actions should be taken;
- How to preserve or salvage tax deferral/life expectancy if possible;
- Spousal IRA concerns – community property, divorce settlements, elective share;
- Undue influence and beneficiary disputes – or the IRA version of a will contest;
- Post-mortem possibilities if the named beneficiary has “Special Needs”;
- The issues presented when trusts are named or utilized inappropriately;
- The constant balance between best possible tax deferral and getting the IRA into the right hands; and
- Best practices
Register now for this program using your ABA ID (00954888).
Friday, November 30, 2012
Carolyn Grose (Professor of Law, William Mitchell College of Law) has recently published her article entitled Outcomes-Based Education One Course at a Time: My Experiment with Estates and Trusts, 62 J. Legal Educ. 336 (2012).
Here is the abstract from the SSRN version of her article:
Over the past three or four years, the legal academy has been under pressure to reform, driven by the critique that legal education does not adequately prepare law students to be lawyers.
The Carnegie Report, Best Practices for Legal Education, and even publications by the American Bar Association challenge law schools to radically rethink the delivery of legal education by starting at the end and working backwards. The current buzzword for this kind of education is “outcomes-based” education. The reports encourage law schools to focus on demonstrated student learning (outcomes) rather than what students are taught (input). In fact a report by the ABA Outcome Measures Committee recommends that output measures substantially replace input measures for the purpose of law school accreditation, and the ABA is currently considering amendments to its Accreditation Standards that would incorporate parts of that proposal
When presented with the opportunity to teach a new course, I decided to put some of these ideas to the test. Thus, in planning and ultimately delivering my Estates and Trusts course for the first time, I started at the end: by identifying my desired outcomes. What did I want students who completed my course to be able to do? In Stage II, I identified what evidence I would need to determine whether students had achieved these stated goals. What would student proficiency look like, in my course? Having identified such evidence, I designed assessment tools and activities that would measure such evidence and help me determine the level of proficiency. Stage III involved designing my instruction tools and teaching activities geared toward helping students gather the evidence necessary to allow me to assess whether they were achieving the stated outcomes. I planned to teach toward my goals. And finally, in Stage IV, I reviewed the whole process – one goal at a time, one class at a time, one assessment tool at a time – to figure out how I as an instructor had succeeded, or not, at designing and delivering the course from the end to the beginning.
In this article, I explore and demonstrate the effectiveness of outcomes-based education in the context of the planning and delivery of this one course. After giving a general overview of outcomes-based education, each section of the article will first describe the particular stage of outcomes-based education (i.e. outcomes, assessment, delivery, evaluation), drawing from non-legal and legal education resources on the topic; and then will describe my process of implementing these ideas, with some evaluation of their usefulness both for me as a teacher, and for my students.
I do not think I am ruining the story by giving away the ending: Requiring clarity and transparency about my goals for this course, and gearing the entire course toward helping students meet those goals resulted in a course that felt more intentional, contextual, and capable of reproduction than any course I had taught before. I believe the students benefited from my planning and teaching, by gaining more understanding both of the material itself, and also of the process of learning the material. Their ability to self-assess throughout the semester improved measurably, allowing me to refine and adjust the materials as needed much more than I had done in previous courses. In short, this way of designing and implementing a course worked beautifully for me, and I believe it worked for my students.
Wednesday, September 5, 2012
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