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Your Bank > Education and Advice > CNB University

Bring the Pieces of Your Financial Plan Together

M Buonaugurio
Mark Buonaugurio is Senior Vice President - Group Manager, Investment and Financial Planning Services and can be reached at MBuonaugurio@CNBank.com or 585-419-0670 x50617.

For most of us, wealth is not an end itself, but a means to living a rewarding life – achieving personal goals, caring for family members and contributing to the larger society around us. All of this requires a vision of what we want to accomplish and how we intend to do it. When wealth is required to achieve those goals (and it usually is), your financial plan will be key to helping you reach them. If your wealth strategy is executed well, the different parts of your financial life should fit together like pieces of a puzzle, with a picture that meets your goals. Often, however, our financial assets look like a series of collectibles – a hodge-podge of securities – that chronicles one’s life rather than a guide to the future. When this happens, it is very easy to lose sight of the financial plan, or even to lose track of the assets themselves.

Here are a few simple ideas to keep your assets on target with your plans.

1. Take stock of your certificates.

Maybe you inherited stock certificates long ago and put them somewhere for safekeeping. It may sound strange, but it can be very easy to lose track of such securities. All of your assets are relevant to your financial plan, but if you forget that you have them, they can’t very well help you achieve your goals.

One client recently found an old municipal “bearer bond” – a physical certificate with coupon stubs attached. The bond had long ago matured. Not only did she not receive her principal repayment, but she failed to present her coupons to get the interest income for many years. Another client found several stock certificates tucked in a desk drawer when a family member passed away; among them were Kodak shares that should have been sold long before the company lost all of its value.

These common examples of out of sight, out of mind aren’t limited to stocks and bonds. Where’s that insurance contract you bought years ago? Is it still in force? Do you still need it? Your financial planner can help determine if this should still be part of your planning puzzle.

2. Consider your options.

Some employers give their workers shares in the company, or options to buy shares. These may be held in a profit sharing plan with the company, or they might have been deposited in a brokerage account or with a stock transfer agent chosen by your employer. In any case, they should be part of your plan. Especially with a former employer, shares can be easily neglected and forgotten. If possible, moving these assets into a managed portfolio is a good way to make sure they are properly monitored, especially if they are a large portion of your total wealth. There are far too many sad tales of investors who lost fortunes in their company’s stock when their employer’s fortunes turned south. Even if such assets weren’t forgotten, the oversight of an objective, unsentimental advisor can avoid unnecessary heartache. (Remember that Kodak stock? It first experienced the tech boom of the 1990s before going bust in 2012 – a small fortune gained and lost.)

Harder to forget, but just as easy to ignore are 401(k) retirement accounts left in the care of former employers. These, too, should be factored into your overall investment strategy. Sometimes 401(k) plans include the company stock, but even in fully diversified accounts, it is important that the asset allocation be properly tended to in a way that is consistent with your overall goals. You can roll over your former employer’s retirement account into your IRA to consolidate your accounts and provide better oversight to reach your goals.

3. Simplify your solution.

Often in the course of a successful career, we buy investments that suit the needs of the moment, but that are scattered in various places: a brokerage account here, a mutual fund there, CDs with several banks, a term life insurance policy somewhere in the house. Are you keeping track of it all? Do the pieces still fit? If you’re getting on in years, does your family or a trusted advisor know where everything is? Bringing the pieces of the puzzle together to form a coherent picture is often the best solution. The idea, remember, is to have your assets serve you to meet your goals. They are not an end in themselves.

By bringing your assets together under the watchful eye of a trusted advisor, you can be more confident that your wealth strategies will stay true to your plan. It allows you to share the burden of tracking your assets with someone who has your interests in mind and who knows all the pieces of the puzzle.

Consolidating your assets with a competent and trusted financial advisor can be the key to simplifying your financial life in a complex and dynamic world – and maybe give you some extra time to enjoy the goals you set out to meet. The professionals at CNB’s Wealth Strategies Group will be happy to help you do that.

How CNB Can Help

If you would like to discuss in more detail, I am available to answer any questions you may have. Please call me today at (585) 419-0670, ext. 50617 or MBuonaugurio@CNBank.com.

This material is provided for general information purposes only and is not a recommendation or solicitation to buy or sell any particular security, product or service. Past performance is not indicative of future investment results. Any investment involves potential risk, including potential loss of capital. Before making any investment decision, please consult your legal, tax and financial advisors. Non-deposit investment products are not bank deposits and are not insured or guaranteed by Canandaigua National Bank & Trust, or any federal or state government or agency and are subject to investment risks, including possible loss of principal amount invested.