Study: Individuals Working With a Financial Planner Add 29% to Their Retirement Income

Account Qualification

Question: I want to start investing but I don’t know how to take the first step?

Believe it or not the first step to investing is not finding an investment itself but the path to the investment. What type of investment account should you open? Let’s walk through the different investment accounts available and their different purposes.

Account Type: Traditional IRA, SEP IRA, Traditional 401k, 403b, 457 Plans.

These accounts typically will provide the investor a present day tax deduction. This can help an individual or family reduce their tax liability in the year the funds were placed in the account. Some of these accounts may allow contributions up until April 15th of the following tax year to help offset the tax year being prepared.

These accounts are best for high income individuals with a long term investment horizon. The purpose of the funds are for retirement purposes.You may be charged with taxes and penalties if you use these funds prior to age 59 and a half.

Account Type: Roth IRA, Roth 401k

Tax free growth. Let’s do that again only go to your window open it up, stick your head out and scream “TAX FREE GROWTH”. That feels good right. The downside is no current day benefit to you.

Roths are best served for those with lower incomes with hopes of being in a higher income tax bracket in the future. The funds, like the IRAs discussed above are intended for retirement purposes and should be held for extended periods of time. Penalties may be incurred for distributions prior to age 59 and a half.

Account Type: Non-qualified or Brokerage

Liquidity. These funds are readily accessible for investors at any point. This type of investment can be converted to cash at any point. The downside is taxes are owed each year for any capital gains, dividends, or other possible transactions.

These types of accounts are for those with intermediate to shorter investment timelines or may need access to capital.

Before you go looking for the perfect investment, you need to find the best account path to help maximize return. If you are unsure what type of account you should open ask yourself or your advisor these simple questions:

  1. Will I need access to this money?
  2. What is my goal for this investment?

These things should help you determine the best course of action. More information on various account types and benefits can be located here

Make it a healthy, happy, profitable day.


8 Tips for Financial Success

As a financial advisor I thought I would share with you my personal favorite 8 tips I believe all individuals, couples or families should be practicing.


  1. There are no get rich quick schemes. Embrace this mindset. Once you realize the path to prosperity is through a slow methodical plan of attack the better off you will be.
  2. Build your emergency fund. You should be thinking along these lines: If a storm damaged your roof, could you comfortably replace it? If your car suddenly dies, could you comfortably replace it?
  3. Be aware of your costs and expenses. Many of us turn on automatic payments and deductions and may not take the time to reconcile our monthly expenses. It is a smart exercise to look through and review bank and credit card statements, reviewing receipts, and turning off services you are not using.
  4. Start investing today. The path to retirement begins the moment you start saving for retirement. Remember tip 1: there is no get rich quick scheme. Don’t wait to start planning ahead, the earlier you start the better off you will be.
  5. Walk away from that purchase. Take 24 hours from that impulse big expenditure. If you still need it or want it 24 hours later, it will most likely still be there. Do you want money or things?
  6. Protect your loved ones. If something were to happen where you, or your spouse, lost your ability to earn an income you will want disability and/or life insurance to protect against this loss.
  7. Basic estate planning. At the very least, you should have a legally binding Will in place to determine where and how assets will be distributed. Do not leave this task up to the government to decide.
  8. Set goals! Setting goals is important for a few reasons. Setting and meeting goals grants us a feeling of achievement, of a job well done. Setting goals also allows us to hold ourselves or our professionals we hire to a high standard. If your goals are unattainable your financial professional can set you straight. If you are investing for yourself and never making your goals it may be time to seek help.

If you would like to learn more about my thoughts related to personal finance and how easy building blocks can begin a lifetime of wealth please email me at [email protected] or find me on Facebook at Paul Hundley, Lighthouse Capital. You can read more of my blogs at the Lighthouse Capital Blog.

Make it a healthy, happy and profitable day!

Paul Hundley

Discussing Life Insurance

Life insurance: this is a topic I avoided for most of my professional career. I always liked to view myself as an “investment” guy. I would rather focus on equity, fixed income, asset allocation, macroeconomics, and how the world around us can affect your investments. However, when I became a father almost a year and a half ago life insurance was a topic I could not continue to ignore. My daughter depends on me for everything, financial support being one of them. It is not fun to think of my mortality at just 37 years of age, but my mother passed at 48 years old and my uncle passed at 32, both due to cancer related complications. Unfortunately, my family history is my reality and it would be irresponsible to not plan defensively, should a day come and I am unable to provide for Cadence.

The most common question I encounter regarding life insurance is determining how much insurance an individual needs, and what kind of insurance coverage they may require. There are a few simple starting points that I take into consideration.
How much are your earnings? How much does your spouse earn?
What are your current liabilities – mortgages, cars, credit cards, student loans etc.?
What are your future projected liabilities- children, college etc.?

The next issue is determining what type of life insurance coverage is needed. Do you need temporary, or more commonly referred to as term insurance? Term insurance covers you for a set number of years. Or is a permanent policy through whole or universal life more appropriate for you and your family? Permanent policies are typically for families with special needs children or possible estate planning needs.
Click Here for an explanation of different types of life insurance.

Planning for the cost of life insurance should not be a burden..There are extremely affordable policies on the marketplace, and we would be happy provide you with a number of different quotes and policy types.

Personally, life insurance is extremely unfun. But I promise you this, if for some unforeseen reason your spouse calls me with tragic news we will not be talking stock. We will be talking about how you did the right thing protecting your family.

I look forward to regularly sharing with you my views relating to personal finance. I would appreciate any feedback that you may have, and if you have a topic that you would like me to cover, please email me at [email protected] or find me on Facebook at Paul Hundley, Lighthouse Capital. Or read more of my blogs at the Lighthouse Capital blog.

Make it a healthy, happy, and profitable day.


Study: Many People are Significantly Behind in Saving for Retirement

(Source) – While many Americans know if they’re putting money aside for retirement, few can tell with confidence how much money they should accumulate to maintain their lifestyle after they stop working. Over 80% of Americans say they don’t know how much money they’ll need for retirement, according to the final report from a four-year-long study of 50,000 people aged 25 and older, and released recently by Merrill Lynch with aging consultants Age Wave. Retirement costs 2.5 times the cost of the average American home, it found.

The median amount of saving for households age 65 to 74 was $148,000, less than three times the median U.S. salary of $55,775, according to 2015 Government Accountability Office report, and far below the required amount that would ensure a comfortable lifestyle. People should have 10 times their current salary by the time they’re 67, according to Fidelity Investments. Click here for the full article. 

Our take: How much should you save for retirement? This is one of the most frequently asked questions that we receive, and the answer is entirely dependent on your particular situation. It all depends on your goals, determining what your needs will be in retirement, and your investment risk tolerance. Getting organized and assisting individuals map out their road to retirement is a frequent task that we engage in with our client’s. Contact us at [email protected] to help plan your retirement.

Study: Individuals Working With a Financial Planner Add 29% to Their Retirement Income

(Source) – Research by David Blanchett and Paul Kaplan of Morningstar, Alpha, Beta, and Now . . .  Gamma, has attempted to quantify into real numbers the value that financial planners can provide.  Their research shows that financial planners help individuals generate roughly 1.82% excess return each year, creating roughly 29% higher retirement income wealth.  This means even if an adviser is charging a 1% fee a year for the management of retirement assets, the financial advice still has a huge impact on generating additional retirement income. Click here for the entire article. 

Our take: This research showcases the tremendous value that a financial planner can bring to an individual’s retirement. According to this study, if an individual is on track to earn $50,000 per year in retirement, they may be able to increase this amount to $64,500 per year by working with a financial planner throughout their career. Find out how we can help you with your retirement, by contacting us at [email protected].



IMPORTANT DISCLOSURE: Results may vary. Lighthouse Capital, LLC did not participate in this research study performed by Morningstar, Inc..