SHE OWNS IT

Let’s say you inherited an IRA from your parents, or you’re the beneficiary of an inheritance from your beloved Grandmother. Or your business is finally doing so well (after many years of hard work and losses), that you have more income than you imagined.  All of a sudden with this financial improvement, you are trying to figure out how to handle the money.  Even if this financial gain was expected, you might find the size or the complexity of managing the assets overwhelming.

As a financial advisor to those that find themselves in this situation, I am continually fascinated by how people handle their assets.  Everyone views their assets in a variety of different ways. For instance, if you look at a certain stock in your portfolio and think of the person who gave it to you, you may find you now hold a certain amount of personal sentiment to it. Does this mean you will never sell this stock? Why do some people not think twice about selling a stock gift, while others would never consider selling it?  As your financial assets grow, your ability to evaluate and manage these assets needs to grow also.

We advise you to evaluate your new financial position as well as learn to manage your assets and the tax implications. Investments including businesses are ongoing entities, so they need to be managed from the perspective of an overall portfolio.

Some questions to consider about your assets:

• If your grandmother gave you the stock is it still your Grandmother’s money?  Or maybe you had built your company that may have been in the family before, or you started it from scratch.
• When do you take ownership and responsibility for the gains or losses of the investment?
• When do you have the right to make the decisions about how to spend or invest the money?
• Let’s say your Aunt gave you Apple stock 15 years ago, and it has gone up tremendously.—Do you just give her credit for that decision and plan to hold it forever?—What if she gave you GE and you did not sell it and lost money?  Do you blame your Aunt for the win and yourself for the loss?

When we manage money for clients –when the assets go up the clients take the credit, and when it goes down, it is the advisor’s fault.  I get it—that is human nature and fact of this investment business.  But why do we become attached to certain stocks or investments because of the history?

We need to be professional about these decisions in managing our investment portfolio and not take unnecessary risk.  As entrepreneurs, you are dedicated to the growth of your business and are you reinvesting your assets in your company?

 “Woman Up” and take responsibility and control of your assets.  It is your money.