Mattson Financial Services June 2019
F I N A N C I A L S E R V I C E S , L L C
616-514-3831
www.MattsonFinancial.com
June 2019
Have You Tuned In to Diversity? UNDERPERFORMING ASSETS
Recently, a client came to me wanting to talk about his portfolio. He had concerns that some of his assets were underperforming. This surprised him because he thought the market had been performing well this year — and he assumed his investments would follow suit. Many people look to the Dow Jones Industrial Average as a gauge for the economy and for their portfolio. In the case of this client, he noted the double-digit return in the market and asked why he wasn’t seeing similar returns in his portfolio. In the portfolios we manage, about 13 percent of the assets are tied to companies on the Dow Jones. The Dow is made up of the top 30 companies in the market. This begs the question: If the Dow is only 30 companies, why do news organizations insist on reporting on how well the Dow is doing on a daily basis? The answer is it makes for good drama. The Dow may drop 2 percent, but the report will say a “500-point plunge.” It sounds like major economic news. A few decades ago, a 500-point plunge would have been catastrophic, but today, it doesn’t mean nearly as much. It’s not even a blip on the radar. “The things our fathers, grandfathers, or even great- grandfathers were investing in might not make any sense today.” Now, these 30 companies do represent the largest workforces in the country. How well these companies perform, good or bad, can give us
some insight into how the economy is doing, but they’re not the best gauges for portfolio performance.
In 2017, the No. 1 market return was from small-cap, not Dow, companies. Small-cap companies outperformed the Dow 2 to 1. But if you have all of your money in small-, medium-, or large-cap companies, you’ll only end up hurting yourself — and you won’t be happy with your portfolio. This is why we talk so much about maintaining a diverse portfolio. The things our fathers, grandfathers, or even great-grandfathers were investing in might not make any sense today. They may have seen excellent returns in the past, but that may not hold true as we look at the current financial landscape. At one point in time, they may have been getting 12 percent returns on simple savings accounts, but that doesn’t happen today. At Mattson Financial Services, we utilize WealthGuard — a tool that helps ensure proper asset allocation when it comes to long-term investments. It protects your retirement funds and helps keep you nimble. That is to say, when the Dow is posting double-digit returns, you might not see that reflected in your portfolio. But you’re certainly not going to see major losses when the market takes a turn in the other direction. Realistically, you’re more likely to see 8–10 percent returns. As you prepare for retirement with a diversified portfolio, you’ll be set up with the income you need to enjoy that retirement. So, when it comes down to it, tune out the news and tune in to diversity! –Gary Mattson
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‘INFLUENCE’
A ROAD
Business majors and longtime entrepreneurs will be very familiar with this work. And in an age when many shiny new theories on leadership and personal development come out every year, it’s refreshing to revisit a classic that has stood the test of time. Thirty-five years after its original publication, “Influence: The Psychology of Persuasion” should still be required reading for marketers, small business owners, and anyone else looking to improve their negotiation skills. Written by Dr. Robert Cialdini, “Influence” explores why people say yes. A professor of business and psychology, Dr. Cialdini is uniquely qualified to tackle this question, combining scientific data with practical applications. “Influence” is still a subject of praise, with marketing research groups and journals of psychology lauding the book as a “proverbial gold mine.” You don’t have to get too far into “Influence” to see why.
Dr. Cialdini lays out six “universal principles” of the human psyche. These include “Reciprocity,” our tendency to want to return perceived kindness or concessions; “Commitment and Consistency,” our tendency to cling to past decisions; and “Scarcity,” our tendency to assign value to things based on their rarity. While these may sound like surface level business concepts, the way Dr. Cialdini uses these principles as a launching point gives “Influence” value. With each principle, the author dives into examples of how these psychological elements can be used by you or against you in any negotiation. Take “Commitment and Consistency” for example. If you are able to get a person to agree with you on several small points, you lay the groundwork for them to agree with you in the future. Conversely, you can be more alert when people try to use this tactic on you.
WHY TAI CHI IS COOLER THAN YOU THINK
Better Balance With the Internal Martial Art
When you think about martial arts, a few images come to mind: Mr. Miyagi, possibly nunchucks, and people breaking objects using impressive disciplined strength.
While the movements appear mild, the practice of tai chi requires discipline and strength. That’s part of the reason why it provides a powerful punch of health benefits and also why less than 5 percent of people stick with it. Some teachers say it takes three years to learn the basic movements of tai chi — and more than a lifetime to master. Physical training, combined with the internal meditative aspect of tai chi, are the reasons martial arts legend Jet Li has turned to the exercise in recent years, even campaigning to make it an Olympic event. In an interview, Li explained his push to make tai chi a more widely recognized and accepted exercise: “In our attempts to push ourselves, we’ve lost sight of an important part of the sporting mindset: balance.” For anyone setting out on a mission to age gracefully, tai chi can help reduce your risk of falling with its focus on posture. An ounce of preventive tai chi may be worth a pound of cure; the Center for Disease Control reports that people pay an average of $35,000 in health care costs every time they fall. Many community centers and health and wellness facilities offer opportunities to learn tai chi, from free community classes to entire tai chi facilities. Go see for yourself why this is the martial art everyone should practice.
But one of the most powerful martial arts you may not immediately picture is tai chi. This ancient Chinese form of combat in slow motion is an internal martial art that works from the inside out by developing the body’s internal energy, known as qi, or “chi.” In Chinese medicine, balanced qi is essential to good health. Hundreds of studies demonstrate the mental and physical benefits this quiet martial art provides. Because of its focus on posture, tai chi is particularly helpful for balance. In Harvard’s analysis of 20 different studies, tai chi was shown to improve cognitive
function and slow the progression of dementia more than other forms of exercise.
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AP TO CLOSING DEALS
One of the most powerful results of reading “Influence” is that it helps you recognize behaviors you yourself were unaware of. Indeed, that’s the whole underlying thesis of Dr. Cialdini’s work: As social creatures, we all have
The freedom of retirement certainly comes with its perks, but challenges of post-work living exist as well. Chief among them, for most elderly folks, are fears of social isolation and financial insolvency, as having coworkers and a regular income are not as common in retirement. Perhaps this is why so many retirees are flocking to home-sharing platforms like Airbnb or its seniors-only cousin, The Freebird Club. Airbnb reported last year that the 60-plus age bracket is its fastest- growing demographic worldwide, with the number of senior hosts as much as doubling every year. Home-sharing platforms can be a tremendous boon to a tight retirement budget. It’s an especially attractive option to elderly folks who find themselves rich in assets but struggling with liquid finances. Home-sharing allows them to tap into these resources. According to Priceonomics, U.S. Airbnb hosts bring in a monthly average of $924. But home-sharing can do more than boost your income. By opening a room in your home to travelers, you’ll encounter all kinds of people you might never otherwise meet, prompting dynamic social interactions and meaningful connections. The rating systems on Airbnb and similar platforms almost entirely prevent would-be troublemakers from entering your property, and users report that when a rare negative experience does occur, the company typically has your back. It’s a great way to stay socially engaged while staving off loneliness. Best of all, running a modestly successful Airbnb usually doesn’t take much work. It simply requires you to set up a neat, welcoming space, keep in contact with your guests, and ensure the check-in and check-out processes are as straightforward as possible. In fact, senior hosts seem to have a leg up on their younger counterparts, as elderly hosts earn the most consistently positive ratings across the globe. Airbnb and The Freebird Club won’t make you rich, but they’re relatively low-effort enterprises that come with some massive benefits. If you’re looking for a little busywork, some extra cash, and a little social interaction in your retirement, hosting may be your best bet! An Opportunity for Easy Money and Social Engagement WHY SENIORS ARE FLOCKING TO HOME-SHARING PLATFORMS
habitual behaviors geared towards finding common ground with others. Once you are aware of these behaviors, you’ll begin to see conversations and negotiations in a whole new light.
GRILLED BEEF RIBS LAUREL’S FAVORITE
Nothing feels more paleo-appropriate than digging into a giant rack of beef ribs. This largely hands-off recipe requires plenty of hands-on eating, making you feel like one of our cave-dwelling ancestors.
Ingredients
• •
1 5-lb. rack of beef ribs Kosher salt and black pepper, to taste
Directions
1. Heat a charcoal, wood-burning, or gas grill to medium-high. Once heated, move heat source to one side or turn off half of the burners to create an indirect heat zone. 2. Season ribs with salt and pepper and char on the hotter side of the grill, turning occasionally, for 12–15 minutes. Once charred, transfer to the other side of grill and cook until the thickest part of the rib reaches 130 F, about 2 1/2–3 hours. 3. Let meat rest for 15 minutes. If desired, serve alongside grilled veggies.
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PRST STD US POSTAGE PAID BOISE, ID PERMIT 411
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F I N A N C I A L S E R V I C E S , L L C
SAVE THE DATE! June 7 — *New Time* First Friday Event 12–3P.M. at our Kentwood Office, “Social Security & Long TermCare” FT. Shaved Ice & Rolled Ice Cream! July 5 —No First Friday Event July 13 — Annual Charity Event, “A Magical Night in Shanghai” More details soon! Aug. 2 — First Friday Event 12–3P.M. at our Kentwood Office, “Show and Shine!” Car Show. More details soon!
3226 28th Street SE Kentwood, MI 49512 INSIDE THIS ISSUE
Tune In to Diversity
1
‘Influence’ and the Psychology of Yes
Why You Need to Add This Exercise for Better Balance
2
Why Seniors Are Flocking to Home-Sharing Platforms
3
Exploring the River of No Return
4
**Reminder: If you have any changes to your financial situation, please notify us as soon as possible.
Investment advisory services are offered through Mattson Financial Services, LLC, a Registered Investment Advisor in the state of Michigan. Insurance products and services are offered through Lakeview Financial Group, LLC. Mattson Financial Services, LLC and Lakeview Financial Group, LLC are affiliated companies. JOURNEY DOWN A RIVER OF NO RETURN
The Unspoiled Beauty of Central Idaho
There’s more to Idaho than potatoes. Sitting square in the center of the Gem State is one of the largest contiguous areas of protected wilderness in the U.S. While the Frank Church-River of No ReturnWilderness Area may not roll off the tongue as easy as Yellowstone or Yosemite, this 2 million-acre swath of mountains, gorges, and alpine lakes offers something for outdoor enthusiasts of all stripes. River of No What, Now? The name of the wilderness may sound a little ominous at first —who wants to travel down a river of no return?—but in truth, it’s a title from times gone by when canoes and small watercraft could travel down the Middle Fork of the Salmon River swiftly but couldn’t fight the current going back up. Today, those same rapids make the Middle Fork a wildly popular whitewater rafting destination, with plenty of local and out-of-state enthusiasts making a return journey every summer. Rafting Isn’t for Me. What Else You Got? If crashing down 300 Class III rapids isn’t your speed, the Frank ChurchWilderness has plenty of other ways to enjoy the wildmountain country. There are several lodges that were grandfathered in to the wilderness area, most of which are only accessible by jet boat, light aircraft, or good old-fashioned hiking. Some, like the Middle Fork Lodge, offer five-star accommodations, located conveniently close to one of the area’s many natural hot springs. Those with the right permits will find the rivers and lakes full of fishing opportunities, and the surrounding pine forests are teeming with game. Lodges? I Just Want to Get Away From It All. For those looking for a truly unplugged experience, backpacking to the many campsites scattered throughout the region can be an incredible journey. If you spend a night beside the crystal-clear waters of Langer Lake, hundreds of miles away from any light pollution, you’ll find peace, quiet, and a sky bursting with stars. If you’ve ever wanted to experience a truly untamed part of the United States, Idaho is the hidden gem you’ve been looking for.
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