connections - Conway Wealth Group

Fall 2015
CONWAY ’S
CONNECTIONS
PLEASE, TALK ABOUT MONEY!
BY MICHAEL CONWAY
After selling our longtime family home last year,
which was emotional and difficult for all of us, we
have found ourselves living on a farm! While I’ve
always wanted more space and a more rural lifestyle,
I admit I am a bit amazed at where we have landed.
We recently had horses make their way to our barn,
and Leslie will be headed out to the coop to gather
farm fresh eggs. (It’s possible this is news to her.)
Remember the TV show, “Green Acres?” It seems
I’m living it.
MICHAEL CONWAY
both are relieved to be out of Brooklyn, and Meghan
It ensures that they have a full understanding
has begun her job as a special educator.
of their parents’ wealth and what their
parents have decided to do with it.
Allison is making her way in NYC and loving every
minute. She’s managed to travel a bit as well and
Estate plans often are complex. Typically,
has found herself in Copenhagen, Interlaken,
a plan for a wealthy family may include
foundation funding, insurance for estate
Switzerland, and San Francisco over the past
taxes, a variety of trusts, gifting significant
few months.
sums to children, and other elements. It’s
Luke spent the summer helping at Conway Wealth
far better for adult children to see the whole
Group, working on an organic farm, and even
picture, rather than just the aspect that
moving boxes and stripping wallpaper for his mother.
directly involves them (receiving a significant
After packing up everything we own and filling
It’s amazing to realize that he has begun his junior
financial gift). It offers additional financial
multiple dumpsters while arguing over what defines
year at High Point University.
education, and may help prevent
“dumpster worthy,” we are now starting a new
adventure on the farm.
If that wasn’t enough, Zach just got married a few
months ago! Meghan is now the official new
In my experience, including adult children
again, unless of course you count the horses and
the chickens? If so, then I guess we are full up again.
Mrs. Conway, and we are thrilled. On a gorgeous
Life is never dull. It sneaks in a few surprises. We are
Saturday afternoon, they said, “I do,” and now will
now in-laws and farmers. I have to say, I love the
be starting their life together in Morristown. They
misunderstandings.
Which leaves Leslie and me with the empty nest yet
former, but never saw the latter coming.
thinking about the flow and management
that it’s impolite to talk about money.
of money. If they accomplished specifically
Unfortunately, this proviso of polite
defined household chores, the kids were
conversation has hampered financial literacy
given 10 one-dollar bills each. Then, I would
for generations. In my opinion, it is imperative
ask for three of those dollars back:
parents’ money is being managed and the
• $1 for tithing, which went to the church.
been made. Children learn about legacy
for families to talk about money.
Many schools don’t teach some of the most
basic skills required to live a successful life.
We are taught about U.S. history, but we
• $1 for tax, which was used to offset the cost of a family dinner out or an event.
valuable. It gives parents an opportunity to
model financially responsible behavior, and
helps children better understand how their
reasoning behind specific choices that have
issues, tax consequences, and other matters
they may not have considered previously.
• $1 for investment, which was invested.
We recommend that families open
When allowance time came around, we
and legacy plans long before the death of
answered all kinds of questions. Why do we
a parent occurs. If everyone has a thorough
have to give money back? What happens
understanding of legacy plans, the potential
checkbooks.
if I don’t? Why do I want to invest? What
challenges of estate disposition are minimized,
if I don’t have enough money this week?
and the process may go more smoothly.
As a result, it’s often left to parents to educate
What if I want to give money to something
don’t learn how to register to vote. We’re
Michael Conway
President and Chief Executive Officer
Conway Wealth Group LLC
in financial discussions of all kinds can be
For many years, people have been taught
taught how to drive a car, but we are not
told how to change a tire or how to purchase
an automobile. We’re taught Algebra, but
not how to complete tax forms or balance
communications about financial expectations
We can help
their children about financial matters. Teaching
else, like the Humane Society? It gave us the
financial principles from an early age estab-
opportunity to talk about some pretty
lishes a baseline of financial knowledge that
important concepts, and helped us provide
financial and legacy planning, from wills and
can help the children make sound financial
our children with a sound financial foundation.
trusts to insurance to powers of appointment,
decisions from youth through adulthood.
Find teaching opportunities
When our children were growing up, I set
Make legacy planning a part
of their education
up a very basic financial system within our
children involved when decisions about
house. It was intended to get the kids
structuring estate plans are being made.
It is a good idea to have older and adult
As advisors, we can help all aspects of
and much more. We also can make it easier
to talk with your children—no matter how old
they are—about money and financial planning.
After all, that’s what we do every day.
/1
WHY HAS U.S. ECONOMIC
GROWTH SLOWED?
by Americans has increased from 14 percent to 46 percent of
Historic Composition of U.S. GDP
total U.S. tax receipts. This has reduced Americans’ spendable
income and negatively affected economic growth.
Government expenditures currently account for 18 percent
of GDP. While government spending has increased from historic
4
levels, it is financed by tax dollars (money subtracted from
consumer spending) and often is less efficient in utility and outcome.
Private investment and inventories comprise about 16 percent
of GDP today.4 Studies have shown higher investment spending
is correlated with higher economic growth. Investment is
influenced by demand expectations. When demand is low,
investment is reduced.
Annual share
of GDP (percent)
Consumption
Government
Expenditures
Private
Investment
Net Exports
1961-70
61.8
17.1
20.5
0.6
1971-80
62.5
17.2
20.6
-0.3
1981-90
64.6
17.0
20.3
-1.9
1991-2000
67.3
15.3
18.9
-1.5
2001-2010
70.0
15.9
18.6
-4.5
2011-2014
68.5
19.2
15.6
-3.3
2015 through 2Q
68.3
17.8
16.9
-3.0
St. Louis Federal Reserve, Organization for Economic Cooperation and Development,
Bureau of Economic Analysis
Net exports reflect the difference between goods and services
imported to the U.S. and those exported by our country. Most
recently, net exports detracted from GDP, lowering it by about
3 percent.4
Since the 1930s, the individual income tax paid
by Americans has increased from 14 percent to
46 percent of total U.S. tax receipts.
How do we spur GDP growth?
BY DEAN RAHIMI
Rising income taxes have hurt consumer spending
In its 85th Annual Report, the Bank for International Settlements
Year
suggested that the only way to “…sustainably raise output and
Measuring the productivity and growth of a country is one
growth was 16.9 percent during the first quarter of 1950 and
way to gauge its economic health. Economist Paul Krugman
the worst was -10 percent during the first quarter of 1958.3
wrote, “Productivity isn’t everything, but in the long run
it is almost everything. A country’s ability to improve its
standard of living over time depends almost entirely on
its ability to raise its output per worker.” 1
A well-known measure of economic productivity is Gross
Domestic Product (GDP), which estimates the value of
goods and services produced in a country during a given
period. It’s found by adding public and private consumption,
private investments, government expenditures, and net
productivity growth and to shake off debt addiction,” 5 is to move
Individual
income taxes
Corporate
income taxes
Total receipts
$
(in millions)
% of tax
receipts
$
in millions)
% of tax
receipts
$
in millions)
away from stimulative policies that influence aggregate demand
1940
892
14
1,197
18
6,548
However, U.S. economic growth has been slowing over
and to embrace policies that produce structural change,
1960
40,715
44
21,494
23
92,492
time, as the trend line indicates. To understand why our
including “…improving the flexibility of product and labor markets,
1980
244,069
47
64,600
12
517,112
growth has slowed, it’s helpful to look more closely at the
providing an environment conducive to entrepreneurship and
2000
1,004,462
50
207,289
10
2,025,191
components of GDP.
innovation, and boosting labor force participation.”
2014
1,394,568
46
320,731
11
3,021,487
Consumption (or consumer spending) has become the
In my opinion, to boost productivity in the U.S. we need
largest component of U.S. GDP. It has been the driver of
to pursue sound fiscal policy that may include actions like:
• Encouraging development of skilled labor
• Cutting individual income tax rates
• Pursuing pay for performance policies
• Investing in infrastructure
Sustainably increasing GDP growth is not a short-term endeavor. It will require
• Increasing public private partnerships
the political courage to implement policies that may take years to bear fruit.
U.S. economic growth in recent decades, and currently
accounts for about 68 percent of U.S. GDP.4
exports. As the chart shows, from 19472 through 2014, U.S.
In order to spend, consumers must have money in their
GDP averaged 3.26 percent annually. The fastest rate of
pockets. Since the 1930s, the individual income tax paid
5
Office of Management and Budget, Historical Tables, Table 2.1
1
Paul Krugman, The Age of Diminishing Expectations (1994)
The first year quarterly GDP was measured in the U.S.
3 Bureau of Economic Analysis [http://bea.gov/iTable/iTable.cfm?ReqID=9&step=1#reqid=9&step=3&isuri=1&904=1947&903=1&906=q&905=2015&910=x&911=0]
4 Bureau of Economic Analysis [http://www.bea.gov/iTable/iTable.cfm?ReqID=9&step=1#reqid=9&step=3&isuri=1&903=5, cited 8/27/15]
5 Bank of International Settlements, 85th Annual Report, June 2015, p. 18
2
2 / CONWAY’S CONNECTIONS / CONWAY WEALTH GROUP
/3
RETIREMENT INCOME
MISCONCEPTIONS
AND REALITIES
Investing for yield can be risky
Trying to generate enough income for retirement by investing only in assets that pay interest or dividends is not a great
idea in any market environment, but it’s a particularly tall order in the current low interest rate environment. In early
August of 2015, the real interest rate (after inflation) on benchmark 10-year U.S. Treasury bonds was about one-half
of one percent.7 That’s not enough interest to provide a decent level of income for most retirees so, they look elsewhere
to increase their income.
If choices are limited to assets that offer interest or dividends, such as longer-term bonds, lower-quality bonds,
dividend-paying stocks, real estate investment trusts (REITs), or other options, then the amount of risk in a relatively
undiversified portfolio could increase significantly, especially if the Federal Reserve begins raising interest rates.
A well-diversified portfolio offers retirement
income investors many advantages.
Amid rising rates:
• Dividend stocks often underperform, hurting stock prices and affecting portfolio income.8
• REITs tend to do poorly, especially if the properties in objectives and risk tolerance. There are many reasons
a total return strategy is a sound approach.
1.First, the portfolio is likely to have exposure to asset classes that are performing well during any given period of time.
the REIT have lengthy leases that limit rent increases.9
2.Second, since diversified portfolios often include Each of these investments may do well over long periods
non-correlated and alternative assets, portfolio of time, and they often play important roles in well-diversi-
volatility may be lower over time.
fied portfolios. However, holding concentrated positions
when it seems likely that rates will rise may not be a
sound strategy.
Investing for total return has benefits
BY VICTOR MACCAGNAN
3.Third, well-diversified total return portfolios offer inflation protection because they include stocks—
the only investment that has consistently beaten inflation over the long-term, historically.
Everyday life is peppered with misinformation. For example, NASA reports The Great Wall of China
No one is certain which asset classes or sectors will
cannot be seen from outer space. Searing meat doesn’t lock in moisture, it adds flavor. And Napoleon
perform well during the next month, year, or decade.
Make sure you have enough
retirement income
was five foot seven, which was tall for a Frenchman at the time.
That’s why we build and manage globally diversified
whether they’ll have the income they want and need
portfolios that include multiple asset classes and
when they stop working. If you’re interested in discussing
investment strategies, and align with our clients’
retirement income strategies, please give us a call.
The current market environment is highly unpredictable.
6
While some misconceptions are relatively harmless, others can be quite detrimental. A persistent financial myth
is that investing for retirement income means putting all of your assets into yield-producing investments, like bonds
We offer retirement projections to help our clients determine
or dividend-producing stocks. That’s not the case. A well-diversified portfolio offers retirement income investors
many advantages.
4 / CONWAY’S CONNECTIONS / CONWAY WEALTH GROUP
6
Google docs, Common Misconceptions, cited August 11, 2015 [https://docs.google.com/spreadsheet/ccc?key=0AmCeWwNKr6FmdFFKQm9rZW5HM0dpY2V0OFh0YndCR3c#gid=1]
U.S. Treasury [http://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield] [http://www.treasury.gov/resource-center/data-chart-
center/interest-rates/Pages/TextView.aspx?data=realyield]
8 Morningstar, Dividends Great for Long Term, but Beware Rising Rates, May 29, 2014 [http://www.morningstar.com/cover/videocenter.aspx?id=649457]
9 Investment News, Rising interest rates to test REIT strength even as investors seek diversification, May 16, 2015 [http://www.investmentnews.com/article/20150316/FREE/150319927/
rising-interest-rates-to-test-reit-strength-even-as-investors-seek]
7
/5
PAY-AS-YOU-GO GOVERNMENT
In an effort to balance budgets without raising taxes, local, state,
and federal governments have begun assessing fees for services.
PERSONAL NOTES
SHARON FULGENZI
DEAN RAHIMI
CAROLYN SCHNEIDER
2015 offered proof that we do reap
When I was working with our armed forces
This year has been bitter sweet for my
wonderful rewards for the work, persever-
in Afghanistan, my supervisor inspired me
family. It started off with my daughter
ance, and strength of character it takes to
with his farewell letter. It still resonates with
giving birth to our newest family member,
follow our dreams and raise a family.
me today. He wrote to me that a man’s
Lucy Bee, who was named for her
success is not measured by how fast he
maternal great grandmother. What a joy
runs, but by how fast he can get back up
it was for all of us, especially for her great
after he falls.
grandfather, who was thrilled to welcome
My daughter graduated from the University
of Scranton, cum laude. As every parent
understands, it was a wonderful and
his seventh great grandchild to the world.
proud moment. I like to think I know the
I didn’t realize how powerful his words
most rewarding path for my new gradu-
were until I started my journey with the
In February, our California children and
While the average taxpayer certainly notices
express lanes or roadways, assessing fees
A Department of Justice Investigation found
federal and state taxes withdrawn from a
for driving in congested areas, and/or
ate’s future, but I realize the end goal is for
Chartered Financial Analyst® (CFA)
grandchildren joined us in Boston, along
that, in one city, judicial authority was being
paycheck, they may not recognize these
charging per mile driven.11
her to be happy and able to make those
program. After “falling” a few times, I
with our daughter and her family, for a
used to, “…compel the payment of fines and
decisions on her own. We will travel to Italy
learned how to get back up faster than the
four-day winter wonderland holiday.
The charge for garbage collection
fees that advance the City’s financial
together later this year to celebrate her
time before. I am pleased to report that I
Amazed by the amount of snow covering
Whether you pay a fee based on the size of
interests…the court issues municipal arrest
graduation, her growth, and the next
have completed the CFA program exami-
the ground, the adults spent hours with
your trash can, purchase special garbage
warrants not on the basis of public safety
chapter of her life. And, yes, we are also
nations, and am excited to begin my
the children building forts and igloos and
bags, or owe an annual fee for trash pick up,
needs, but rather as a routine response to
celebrating my role as her parent!
pursuit of practical knowledge in this
just having fun. It’s an experience that
garbage collection fees are becoming
I’m sure none of us will ever forget.
popular among cities with deficits. Seven of
My son has found his passion and he’s
challenging and dynamic discipline.
The cost of commuting
missed court appearances and required fine
Here’s something to consider while driving
payments.” 14
15 major U.S. cities currently charge for
following it. The joy it brings my heart to
Last fall, Roya and I were married and then
The saddest part of this year was the
home: Traffic jams wasted more than three
trash collection, and several are considering
When we evaluate how well our cities and
see his happiness can’t be explained in
traveled to St. Thomas in the U.S. Virgin
passing of my father-in-law in June. He
billion gallons of fuel and nearly seven billion
states are performing financially, it’s critical
words. It’s truly a blessing.
Islands for our honeymoon. It was great
died two days before his 104th birthday.
collection fees.12
trip. Both families are excited about our
We were sad and heartbroken, but also
union.
happy and thankful to have had him in our
additional costs as significant add-ons to the
tax bill. Here are a few examples of fees and
service charges Americans may find themselves paying to keep their cities and states
functioning.
person hours last year. The cost was $160
billion nationally, which came out to about
The price of justice
$960 per commuter.10 Some cities are
The Economist stated that charges in
introducing fee strategies to reduce traffic
American courts have become so high
congestion. They’re charging tolls for
citizens end up in jail for non-payment.13
to consider the big picture—taxes and other
There’s no doubt raising my children has
revenue sources.
been the hardest challenge I’ve faced. It is
with pride, and some relief, that I am able
Roya works at an orthopedic center in
to see the light at the end of the road.
Franklin Lakes, New Jersey, and enjoys
I look forward to the rest of 2015 and hope
it is as joyful as the first half of the year.
10
Texas A&M Transportation Institute, Traffic Gridlock Sets New Record for Traveler Misery, August 26, 2015 [http://mobility.tamu.edu/ums/media-information/press-release/]
11 U.S. Department of Transportation, What Is Congestion Pricing?, July 31, 2014 [http://ops.fhwa.dot.gov/publications/congestionpricing/sec2.htm]
12 Crain’s, What Chicago could soon have in common with LA and Dallas: garbage fees, August 20, 2015 [http://www.chicagobusiness.com/article/20150820/NEWS02/150829982/what-chicago-
could-soon-have-in-common-with-la-and-dallas-garbage-fees]
13 The Economist, It’ll Cost You, August 29, 2015 [http://www.economist.com/news/leaders/21662545-charging-public-services-sometimes-makes-sense-often-though-it-racket-itll-cost-you]
14 Department of Justice, Investigation of Ferguson Police Department, March 4, 2015 [http://www.justice.gov/sites/default/files/opa/press-releases/attachments/2015/03/04/ferguson_police_
department_report.pdf]
6 / CONWAY’S CONNECTIONS / CONWAY WEALTH GROUP
helping others through medical knowledge.
My wife and I hope you enjoy health and
happiness. May your dreams become
realities, and your efforts make this planet
more beautiful.
lives for so long. He left his mark on many
people by letting them know what is really
important in life. I will definitely miss him
but know that I will always smile whenever
I hear his name.
I’m not sure what’s in store for the rest of
the year, but I hope it will be good for all.
/7
Since the Great Recession, the Federal Reserve (Fed)
has instituted unprecedented policies that have
suppor ted the revival of financial markets, helping
investors forget the dark days of the downturn.
THE FEDERAL RESERVE AND
FINANCIAL MARKETS
The process also lowered yields on Treasuries and
suggested it might back in 2010. It suggests the Fed
bonds, driving investors into the stock market. By
is aware of current weaknesses, but must avoid spooking
Bernanke’s own admission, that rush to equity markets
investors who have become so addicted to the safety net
was indeed one intent of the policy, as he believed the
of loose monetary policy.
boost would lead to economic growth:
“...higher stock prices will boost consumer wealth
and help increase confidence, which can also
spur spending. Increased spending will lead to
higher incomes and profits that, in a virtuous
circle, will further support economic expansion.”15
As markets became addicted to announcements, Fed
members focused on wording, timing, and tone to gently
inform markets of even the most miniscule rate increase.
Markets dipped dramatically at the end of August 2015,
a blow to investors who had over-allocated to equity in
portfolios because of the near-zero (Fed-induced) interest
rates. Based on past Fed behavior, it seemed plausible
Even as stocks began to soar, that theory seemed
that the Fed would swoop in to ease the pain with a
a bit backward. Rather than investors pushing equity
well-timed announcement. Or maybe, yet again, they’d
markets higher based on confidence in a growing
choose to delay the rate hike, despite the fact that the
economy, Bernanke was hoping for the reverse—for
economy could easily withstand such a small rate increase.
From March 2009 through August 2015, the Standard & Poor’s 500 (S&P 500) Index rose more than 180 percent,
consumers to spend based on confidence in rising
despite ongoing questions surrounding economic stability. Now, after months of gently warning markets, the Fed must
Sure enough, New York Fed President William Dudley
equity markets. But if investors got weary on the ride
finally move toward a rate hike.
indulged investors, saying that a rate hike at the September
to the top, would there really be enough true economic
FOMC meeting “seems less compelling.” And, of course,
growth to support those valuations? Would investors
stocks proceeded to bounce back from earlier losses.
ZACHARY CONWAY
In a November 2010 Washington Post Op-Ed, Federal Reserve Chairman Ben Bernanke wrote in support of the
Fed’s decision to initiate a second round of quantitative easing. In effect, the process of purchasing an additional
$600 billion in long-term U.S. Treasuries injected more dollars into the money supply, which spurred consumption
expenditures and the overall economy.
really invest on the basis of continued support from
the Fed rather than real economic and corporate
fundamentals?
Amid the drop, Federal Reserve Bank of Kansas City
President Esther George acknowledged that the Fed’s
policies have indeed affected asset values, but seemed
In my opinion, through this psychological herding, the
unsure about the end game. “Whether that means assets
Fed’s policies forced investors to detach from long-
are overpriced, I don’t know,” George said.16
term investment plans and change portfolio allocations
to riskier assets, a frightening proposition for many
Whether Fed officials understand how this will play out or
Americans heading toward retirement and in need of
not, recent history suggests the committee will continue to
income. Unfortunately, the delicate nature of the Fed’s
coddle investors if markets head toward correction.
plan for miniscule rate increases—and the hesitancy to
Regardless, recent market volatility serves as an important
execute the plan—might reveal the true fragility of our
reminder for long-term investors to stay the course with
economic growth. It suggests that years in a bull
portfolios built around risk tolerance, time horizon, and
market did not fully restore the economy as Bernanke
needs for liquidity.
Now, after months of gently warning markets,
the Fed must finally move toward a rate hike.
15
The Washington Post, What the Fed did and why: supporting the recovery and sustaining price stability, November 4, 2010
[http://www.washingtonpost.com/wp-dyn/content/article/2010/11/03/AR2010110307372.html]
16CNBC, Fed’s George: Prepared for rate hike, despite selloff, August 27, 2015 [http://www.cnbc.com/2015/08/27/feds-george-prepared-for-rate-hike-despite-selloff.html]
/9
The Investment News recently published an
2. Use a credit monitoring service. While
include I.D. theft coverage. Also, check
article titled “Identity Thief Explains the Art of
they are not 100% foolproof, credit
with your credit card companies about
Emptying Bank Accounts.” The thief described
monitoring companies track credit
whether identity theft protection is
his success impersonating accountholders. In
reports and will alert clients when new
included with your card.
one case, he convinced a credit card company
accounts are opened in their names.
that he was the real deal when the actual
If you do not use a service, you should
accountholder was on another line trying to do
check your credit report at least once
Be wary when sharing information on
the same thing. The accountholder was at a
a year.
social media sites. For example, don’t
announce your vacation or offer specifics
disadvantage. He had to recall personal details
from memory, while the thief simply pulled the
5. Keep private information private.
3. Have cash available. It may be wise to
about when you will be away from home.
keep emergency cash in your home safe
information off his screen.
17
at home. Then, if your credit cards or
6. Be on guard. If you receive an e-mail or
Fortunately, there are some steps you can take
bank accounts are compromised, you’ll
phone call (even from someone claiming
to protect yourself:
have a fallback. Check your homeowner’s
to be with your bank, credit card company,
insurance policy or talk with your insurance
or a tax agency) asking for personal
agent about the amount that will be
information, just say no. Instead, find the
card statements carefully and in a timely
reimbursed if cash is lost or stolen. This
phone number for the institution and call
manner, and report fraudulent activity
way you can make an informed decision
either security or customer service to
immediately. Check with your financial
about the amount of emergency cash you
verify the validity of the inquiry.
institutions and credit card companies
want to have available.
1. Be vigilant. Review all bank and credit
SIX TIPS FOR PROTECTING
18
YOUR IDENTITY
If you have any questions about how to
about time frames for reporting suspicious charges. If issues are not reported
4. Get insurance. Check with your
within a certain period of time, you may
homeowner’s insurance agent about I.D.
become responsible for the charges.
theft insurance coverage. Some policies
protect your personal information,
please give us a call.
NANCY CHUNG
Technology is changing rapidly. Smart watches and phones
offer apps that help with dinner reservations, ticket purchases,
grocery shopping, laundry, parking, and other tasks. The operating
systems on our smart phones, tablets, and other mobile devices
often sync with our automobiles.
What Is A Life Well Lived?
The older we get, the more important family, health, and financial
security become. In fact, those were the essential elements of
surveyed think their children are well prepared to handle family wealth.
a life well lived according to participants in the 2015 Insights on
Almost two-thirds of parents have not disclosed their wealth to
Wealth And Worth Survey.
So, how well are those who participated in the survey doing when it
Mobile payment systems are transforming smart phones into wallet
held by others. In recent years, criminals and some rogue nations have
replacements. As we take advantage of convenient and time saving
gained access to personal information stored in files held by banks,
technology, it’s important to take steps to protect vulnerable personal
merchants, health care providers, and local, state, and federal govern-
information so we don’t become victims of cybercrime.
ments. Often, the data is sold, combined with personal data taken from
While we can safeguard our personal devices with security software
social networking sites, and used to commit fraud and identity theft.
There is a clear need for family financial communications. Few parents
comes to the essential elements of a well-lived life? 19
Family Not everyone has devoted the time and attention to their
children.21
Good health Many respondents agreed that good health is essential
to a good life. Overall, however, they gave themselves a grade of Bwhen it came to maintaining their health. Most survey participants felt
that they were pretty well prepared for the healthcare expenses they
families that they think they should. Almost 80 percent of survey
might incur—out-of-pocket expenses, long-term care costs, and
participants said there was at least one area of their lives in which they
others—over a long life.
should be doing more, and family was among the top answers given. 20
and encryption, we can do little to secure information we share that is
17 Investment News, An identity thief explains the art of emptying your clients’ bank accounts, July 15, 2015 [http://www.investmentnews.com/article/20150715/FREE/150719942/an-identity-thiefexplains-the-art-of-emptying-your-clients-bank]
19The 2015 Insights on Wealth and Worth survey included 640 individuals with at least $3 million in investable assets. They spanned four distinct generations: Millennials or Generation Y (age 18–34), Generation X (age 35–50), Baby Boomers (age 51–69), and Matures (age 70+). Fifty-seven percent were men and 43% were women.
18
20
Consumerfinance.gov [http://files.consumerfinance.gov/f/201409_cfpb_consumer-advisory_card-security.pdf]
21
Ibid, p. 11
Consumerfinance.gov [http://files.consumerfinance.gov/f/201409_cfpb_consumer-advisory_card-security.pdf]
10 / CONWAY’S CONNECTIONS / CONWAY WEALTH GROUP
Continued on page 16
/ 11
TAKEO SPIKES INTERVIEW
HIS BLUEPRINT
TO SUCCESS
AS A PLAYER AND LEADER
49ers, and San Diego Chargers, serving as captain for 12
Who do you think most inspired you
to become a leader?
of 15 seasons. In addition, Takeo posted 19 interceptions,
And in my household, I think it was a compilation of my
more than 1,000 tackles, and two Pro Bowl appearances.
mother and my father. My mother was the loudmouth.
In a recent interview, we asked Takeo 10 questions about
Whenever something wasn’t right, she would let you
his career as an elite player, teammate, and leader.
know, and then she would attack the problem. My father
Through the rest of his 15-year career, Takeo played for
the Buffalo Bills, Philadelphia Eagles, San Francisco
You served as captain of your team
in 12 of the 15 seasons you played in the
NFL, a true testament to your leadership
and likability among teammates. What
specifically do you think teammates and
coaches saw in you to give you that
designation?
Takeo: I think when people deal with people, it’s like the
old saying: “real recognizes real.” And a lot of it was just
my demeanor and the way that I approached the game.
When it was time for work, it was time for work. When
and just observe. Then he’d make his move unannounced. He was very subtle in his approach, but he was
loud in the way he made his point. I really respected that
because I learned what worked compared to what didn’t.
He proved actions speak louder than words, and that’s
where I really found my style.
What lessons do you think someone in
the corporate world could take away
from your success in the NFL?
Takeo: I think it’s most important to understand that it’s a
marathon and not a sprint. Any time in corporate America
respected that a lot. I was the same person they saw
when you want to advance, or you don’t start out exactly
on the field. They knew I was sincere in everything that
where you want, you have to commit to the process
I did and everything that I said. But more than anything,
rather than focusing on an end result. Throughout that
my words matched my actions, and my actions matched
journey, adversity is going to hit, but that’s just preparing
my words.
you for the next stop of adversity along the way. When
Takeo: Before I really got into motivating someone, I had
to understand that person. When it comes to inspiring
people, I think it’s important to realize that what motivates
you might not motivate someone else, and what
motivates someone else might not motivate you. So
12 / CONWAY’S CONNECTIONS / CONWAY WEALTH GROUP
was kind of like a leopard. He would sit back in the cut
it was time for play, it was time for play. And the guys
You’re clearly a motivated person.
What were your best tactics to motivate
those around you? Did they work?
After an illustrious career at Auburn University, linebacker
Takeo Spikes was selected by the Cincinnati Bengals in the
first round of the 1998 NFL draft. After an impressive rookie
season, coaches and teammates decided to designate
Takeo as a captain of the team.
Takeo: I’ve learned what I’ve learned from what I saw.
you get to the end of that journey, you then have a better
understanding of your own value. The most growth
comes when you think you’re defeated.
As a linebacker, you have to play with
immense intensity, yet also be very aware
of the details of an offense. How did you
balance the two?
Takeo: I created a balance by getting on a routine. I never
I took the time to just understand the person, even just
wanted to be in the business of playing catch up. I knew
a small snippet of his life. And when you acknowledge
what procrastination would do, and I knew how it felt to
the people you deal with, they’ll be more receptive. Then,
be unprepared when it was time to show up. So I took in
when you tell them something, it’s seen as constructive
a little bit every day, instead of trying to swallow a lot at
criticism, only to help them get better and to help the
one time. I knew if I could understand one piece this day,
team accomplish that common goal.
and another piece this day, then put it all together at the
end of the week, my puzzle was complete.
Continued on page 14
/ 13
Continued from page 13
I’m sure you saw your teammates make
on-field mistakes. How did you coach
them through those moments when the
next play was about to start?
What player in the league did you most
enjoy playing against, and why?
Takeo: Basically, I would just tell them that I knew they
and knocking him down. That’s Brett Favre. I remember
were human, that I knew they would make mistakes, and
knocking him down several times throughout a game.
that I was glad to see we were all on the same page. The
With sixty minutes in a game, we would get the best of
Takeo: I’ll tell you about a guy who I really admire
because of his inability to quit, despite us sacking him
ability to show everybody how fast you could forget the
him for 58 minutes. But he would never give up. In every
mistake showed me how you could handle adversity. I
series, he always had the same look in his eyes when he
looked at football the same way I looked at anything else.
came to the line of scrimmage. With two minutes left in
It’s all about being able to adjust. Not only at halftime,
the game or sixty minutes left to play, it was always that
not only after coming off the field for a series, but in any
same look. That’s poise.
moment of the game. What person do you know on this
PERSONAL NOTES
What’s next for you in life? How do you
think your experience in the league will
translate to the rest of your life?
ZACHARY CONWAY
VICTOR MACCAGNAN
NANCY CHUNG
For me, it has been a year of sudden and
This has been a great summer for my
My niece, Melissa, graduated from UCLA
significant change.
family and me. We have enjoyed boating,
with a degree in Biology. She currently
Takeo: I always feel like I have something to say. And
After a year-long engagement that seemed
fishing, playing on the beach, and
is working and contemplating going to
when I talk I feel like it has substance. I want to inspire
to flash by, my wife Meghan and I married
spending time with family and friends.
graduate school. It’s wonderful to see
on August 1st. We had a perfect day, filled
At six years old, Victor and Brianna played
her develop into a kind, thoughtful, and
How did you bounce back
from your own mistakes?
people who are straddling the fence or don’t even realize
their potential. Most of the time, people just don’t move
with family, friends, and plenty of dancing
their first rounds of miniature golf and
independent young lady.
forward. I feel like I was a part of one of the greatest busi-
at our reception. We capped off the event
Takeo: The greatest thing about football is that we
ness models of all time. I’ve had the opportunity to sit on
with a beautiful honeymoon in Mexico,
perform on a week to week basis. So when you talk
the Board of Player Representatives, sit in committee
where we could finally relax, reminisce on
about gratification in the corporate world, you have to
meetings dealing with the NFL, and sit on the first
our wild year, and eat way too much food.
wait until the end of the quarter or check the market and
Player’s Advisory Board with the commissioner. I’ve
measure your gains and losses over a long period of time.
gained valuable information about business and in how
In football, I can put the work in for the week, and if it
people interact with each other, how they operate, and
gives me a little bit of vindication on that Sunday, then I
what their expectations are. Right now, I’m working on a
earth that gets everything right and doesn’t have to make
adjustments? Nobody. A lot of guys could get it right
some of the time or even most of the time. But if their
greatest attribute was to make adjustments and come
back with it right, that spoke volumes to me.
know I’m doing something right and I can continue to
book of photography and interviews that profile 12 NFL
build on that success.
Hall of Fame linebackers, each with unique stories on
and off the field. In those interviews, I’m seeking to
How did you confront disappointing
moments in your career, particularly
through those hard-fought losses?
Takeo: I realized that the game wasn’t all about me.
understand what made them outliers and how they
achieved such greatness that was well outside the norm.
Not to mention, I’ll have my Masters in Business in June.
I have the blueprint.
Back in June, Meghan and I made a quick
decision to move out of Brooklyn, NY, and
head to Morristown, NJ. Now, back at
home in our new apartment, we have
much to look forward to as we start a life
together. Having worked as a special
forward to the day that they are able to
ride the surf with me.
I could do better. I dealt with my frustrations and my
day-to-day activity. It has been fantastic
losses by analyzing them thoroughly, but then I’d go
working with my colleagues to enhance our
back into my mind to think about how I could improve.
business efficiencies and to improve our
I was always taught that the definition of insanity
overall client service. It’s inspiring to see our
is to do the same thing over and over and to expect
efforts translate into a better experience for
a different result. For me, I would change my routine
our clients. I look forward to continuing to
but still keep my core fundamentals. And every year
learn the business in the year ahead.
So the year has brought us new jobs,
a move, and a marriage. We can’t wait to
see what’s next!
June. I always thought that Oxford was
a prestigious place for learning and didn’t
at a fantastic restaurant in Atlantic City.
transportation center for shipping cattle
It once had an unlisted phone number and
from the countryside to London (as food
was supposed to be impossible to get into
for city dwellers) using the River Thames.
unless you “knew” somebody. We always
I love the old buildings there, some
love a great dining experience.
dating back to the 1200s. Filmmakers
rides, and other activities.
In October, I joined Conway Wealth Group
reunion at Oxford University this past
know that it meant “Ox Fort.” It was a
is excited to start her new job
at Lakeview Elementary in Denville, NJ.
I traveled with a friend who had a class
Josephine and I celebrated her birthday
This autumn will bring apple picking, hay
and became immersed in the firm’s
14 / CONWAY’S CONNECTIONS / CONWAY WEALTH GROUP
Shore with their Bodyboards. I am looking
education teacher in Brooklyn, Meghan
When I came to that realization, I focused more on what
I’d get a little bit better.
began to ride the waves at the Jersey
I wish everyone a terrific end to 2015 and
a great beginning to 2016!
even built an exact replica of one the
dining halls at the University to use in the
Harry Potter movie series.
Trips are meant for discovery, and
antique shops are a favorite of mine. This
time, I discovered a calling card case that
can be used for business cards, although
its size is slightly larger. It’s from the
Victorian era, and is made of tiger maple
decorated with ornate silver trim. One
rarely sees hand craftsmanship like
this today.
I hope you and your family are having
a rewarding year filled with wonderful
memories.
/ 15
Continued from page 11
NEWS & EVENTS
What Is A Life Well Lived?
Should long-term care be needed, one-half of respondents
expected to stay in their homes and one-fourth expected to
live in luxury assisted living facilities. These expectations may
Conway Wealth Group Sponsors 17th Annual
Anderson House Golf Outing
be unreasonable for some since only 40 percent have financial
plans in place to support the expense of either option.22
Financial security All participants in the survey had at least
three million dollars in investable assets, and most of them
(93%) said they were financially secure. It’s interesting to note
that respondents from the wealthiest households were less
likely to say they were financially secure than respondents
from households with less wealth.
2015 Insights on Wealth And Worth Survey
23
financial security because it may create complex estate planning
Business owners accounted for about 18 percent of survey
respondents. Many have yet to develop a formal business succession
challenges.24
The survey report pointed out, “Financial security is not an end in itself,
strategy, which could significantly affect their financial security
but rather an essential contributor to the kind of engaged, connected,
during retirement.
meaningful lives that high-net-worth individuals seek.” 25
Few respondents expect their businesses to be run by the next
If you would like to review your financial plans to make sure that you’re
generation, but they have a strong desire to create a legacy for their
well positioned to embrace the challenges and opportunities that life
children even if they do not inherit the business. This, too, can affect
may bring, please give us a call.
22
Ibid. Pp. 7-8
23
Ibid, p. 13
24
2015 Insights on Wealth and Worth Survey, Five Attributes of Today’s Business Owners, May 2015, p. 4 [http://www.ustrust.com/publish/content/application/pdf/GWMOL/USTp_ARBMMBP7_2016-06.pdf]
25
U.S. Trust, p. 13
PERSONAL NOTES
From left to right. Zachary Conway, Jan Holmstrup (Anderson House Executive Director) and Michael Conway.
Rain didn’t dampen the spirits of the hundred golfers
make it possible for us to continue our work, changing
who attended the 17th Annual Anderson House Golf
women’s lives and helping them build happy and
Outing in June at the Stanton Ridge Golf and Country
productive futures,” said Jan Holmstrup, Senior Vice
Club. Once again, the outing included a round of golf,
President Development and Halfway House Services
a delicious lunch, and Mercedes Benz and Flemington
with Turning Point.
Furs hole-in-one prizes. Many players and their guests
in-laws. We enjoyed biking, relaxing on the
beach, crabbing, and fishing. We even played
we’re shifting our focus back to the school
in a Bocce Ball tournament! The kids all had
year and the fall activities that keep us moving
an incredible time at summer camp, while my
on the weekends.
husband and I saw a few concerts, went
down to the Jersey Shore, and caught up on
KIM KUSHEL
Now, as the summer months come to an end,
some movies. We went to Baltimore to visit
my parents (and have some hard shell crabs)!
So much to do, so little time! Is it me or is
The kids spent a very busy week with their
time just flying by?
grandparents which included a ceramics
This year has been filled with fun adventures.
class, enjoying a pre-season Ravens game,
We started by taking a family trip to Hilton
visiting the Maryland Zoo, and topping it off
Head, SC, where we had a great visit with my
with an extra-innings Orioles game!
16 / CONWAY’S CONNECTIONS / CONWAY WEALTH GROUP
Since there is no way to slow time, I take a
minute or two each day to remind my family
attended a dinner and participated in silent and live
auctions, as well as a 50-50 raffle. The event raised more
than $38,000.
Anderson House is a well-respected halfway house and
transitional residence program for women from all New
Jersey counties who are recovering from alcoholism and
drug addiction. Anderson House and Turning Point, Inc.
The featured speaker for the evening, Michelle, was a
joined forces one year ago, in July, and, together, offer a
resident in transitional housing. She graduated from the
full continuum of care from detox to outpatient counsel-
halfway house program two years ago, and has been
ing. The next Anderson House Golf Outing will be held
strengthening her recovery while working in the commu-
on June 6, 2016. If you would like to learn more about
and myself of the importance of living in the
nity. Michelle has received promotions at work, and is
the event or about volunteer opportunities for Anderson
moment and appreciating every day. Good or
considering returning to college.
House, please visit www.andersonhouse.org.
bad, there are many lessons to be learned.
Wishing you all the best in 2015!
Conway Wealth Group at Summit Financial Resources
was a Platinum Sponsor. “Loyal sponsors like Michael
/ 17
Recommendations expressed may not be suitable for all individuals. You should not rely exclusively on the information in this presentation.
Independent research of the risks involved should be conducted. To determine which investment(s) may be appropriate for you, consult
your financial advisor prior to investing.
CONWAY WEALTH GROUP, LLC LLC is owned by Michael W. Conway who offers securities and investment advisory services through
Summit Equities, Inc., Member FINRA/SIPC, and financial planning services through Summit Equities Inc’s affiliate Summit Financial
Resources, Inc. 4 Campus Drive, Parsippany, NJ 07054. Tel. 973-285-3600 Fax 973-285-3666 Direct Office Tel. 973-285-3640
This market commentary is an advertisement. The commentary concept has been developed by the Conway Wealth Group LLC at Summit
Financial Resources, Inc and a majority of the commentary was written by third party contributors edited by the Conway Wealth Group.
20150929-0763
Conway Wealth Group LLC, Summit Financial Resources, Inc., 4 Campus Drive, Parsippany, New Jersey 07054
Tel 973-285-3640
Fax 973-285-3644
www.ConwayWealthGroup.com