Politics Will Largely Determine the Economic Course for 2012

Posted on January 26, 2012 by Robert Fragasso

I recently had the privilege of sharing my outlook for 2012 with the Pittsburgh Business Times. Although the last several years have been very challenging economically, we are slowly recovering. In fact, the latest U.S. Bureau of Labor Statistics’ report shows 200,000 jobs were added to the economy in December 2011, and the unemployment rate, currently at 8.5 percent nationwide, continues to trend downward.

If we add half that many jobs – 100,000 – every month throughout 2012, we’ll shave the unemployment rate even further to 7 percent. So how do we do that? The political stalemate in Washington, D.C., must be broken. The volatility of the market can be directly tied on most days to whether the European Union has got a viable plan to come together and overcome its parochialism. How the world moves politically in 2012 will determine the speed and shape of the economic recovery.

Part and parcel with politics in 2012 are taxes. Although the debate has centered on who should be taxed what amount, how those tax dollars are ultimately used will be a significant factor in determining how the economy fares this year. If we tax people more to maintain nonproductive areas and levels of spending by the federal and local government, the economy will continue to lag.

Although our vote gives us some level of political influence, much of what will happen in 2012 to affect the economic recovery is beyond our control. As investors, it’s important to understand what we can and can’t control. What we can control are the decisions we make. As I’ve said many times, the market’s behavior over the last few years is no different than past cycles. Knowing that, it’s important to make the decision to stay the course you’ve set to reach your financial goals.

We may not be able to control the market, but we’ve learned from it, and we can control how we react to it. Look beyond today to the opportunities you will have after this messy system finds its way through to a solution. And if you need someone to help you make those good decisions to achieve your financial goals, give us a call. We’d be happy to chart a course for 2012 with you.

Article based on in interview with Bob Fragasso in Whirl Magazine, October 2011.
Robert Fragasso, CFP®, is chairman and chief executive officer at Fragasso Financial Advisors, a Pittsburgh-based investment and financial planning firm.  Due to industry regulations, comments are not permitted on this blog.  If you would like to contact the author, please email us at blog@fragassoadvisors.com.  Bob can also be reached for comment at 412-227-3200.

Posted in 2012, Economy | Leave a comment

“Pittsburgh’s Day of Giving”: Sharing Our Good Fortune With Our Neighbors

Posted on November 14, 2011 by Ray Amelio

Pittsburgh is a great place to live for many reasons. It provides us with sports teams filled with iconic players to cheer, world-class dining to please our palates and a beautiful overall setting in which to work and live. In Pittsburgh, we care about the well-being of our neighbors and those from throughout the region, which also makes it a wonderful home.

The employees at Fragasso Financial Advisors have happily planted roots in Pittsburgh, and we wouldn’t want to be anywhere else. Our Chairman and CEO Bob Fragasso, who regularly gives back to the community through his volunteer and philanthropic efforts for organizations including Animal Friends, the Rivers Club, Amen Corner, Entrepreneuring Youth, La Roche College and Duquesne University, has set a great example for other FFA employees.

Our firm has been a part of the Pittsburgh community for four decades and regularly lends a hand to our neighbors. It’s simply the right thing to do. We appreciate what we’ve achieved, and we want to help those who are not as fortunate. Our most recent effort to help others in our region came during the recent “Pittsburgh’s Day of Giving.” Every year, the Pittsburgh Foundation hosts the event and matches all donations made to local charities. The Fragasso employees decided to capitalize on the Foundation’s generous offer to match our donations.

Philanthropy is extremely important to our employees, and 100 percent of them participated in “Pittsburgh’s Day of Giving.” In collaboration with LPL’s Invest in Others Foundation, a charity devoted to supporting the philanthropic and volunteer efforts of financial advisors, we donated a total of $500 to the Greater Pittsburgh Community Food Bank.

Giving back to the community that gives so much to us is a small expression of our gratitude to the region, our clients and our friends. In these tough economic times, we’re grateful for what we have and happy to help those who we can.

Ray Amelio is Managing Director and Chief Marketing Officer at Fragasso Financial Advisors, a Pittsburgh-based investment and financial planning firm.  Due to industry regulations, comments are not permitted on this blog.  If you would like to contact the author, please email us at blog@fragassoadvisors.com.  Ray can also be reached for comment at 412-227-3203.

Posted in Charity, Fragasso staff | Leave a comment

Financial Planning for Our Four-Legged Friends

Posted on October 31, 2011 by Robert Fragasso

We all know the importance of financial planning for the future of our family, but what about financial planning for our pets? For many of us, our pets are family. As a long time supporter and board member of Animal Friends, an organization devoted to the well being of companion animals, I have had the pleasure of adding several cats and dogs to my family throughout the years. The joy and affection they’ve provided to me have added a wonderful aspect to my life. And because of that, I want to be sure they’ll get the care and love they deserve for as long as they live. As a Certified Financial Planner®, I’ve thought a lot about the financial considerations that should be part of pet ownership.

If you’re contemplating pet ownership or already are a pet owner, there are a few things to consider that will help ensure you are providing the same unconditional love your pets will always give to you.

End-of-life Planning
Most pet owners overlook end-of-life planning. Yes, we often consider a guardian and a trust in relation to our children, but making similar plans for your pets is just as important. Think about an individual trust for your pet or leave money to a no-kill shelter like Animal Friends. Did you know a $5,000 deposit to Animal Friends ensures your animal will be placed in a loving home and not euthanized?

Affordability
A question many consider before adding a new animal to the family is, “Can we afford it?” You first need to thoroughly evaluate where you’re getting the animal. Most breeders are great, but do your research. Make sure he or she is responsible and the animals are living in the most humane conditions – not part of a “puppy mill” or similar abusive, neglectful environment. The price of an animal from a breeder can get high, into the hundreds and even thousands of dollars – and that doesn’t include the other essentials you will eventually need to guarantee the pet’s future health. A more affordable option is often available at your local shelter. You can get an animal that has been thoroughly evaluated and vaccinated by a veterinarian and other animal experts, and spayed or neutered – all for about $75.

Pet Insurance
Finally, inquire about pet insurance the next time you visit your vet. Vets will be able to tell you which plans are reasonable and can be used at their office. Typically, policies cost as little as $16 a month, which is a huge difference compared to a $1,000 emergency vet bill.

Simple steps like the ones mentioned above will ensure your pets are cared for properly and affordably. Great no-kill shelters like Animal Friends can help you make good decisions about pet ownership.

Article based on in interview with Bob Fragasso in Whirl Magazine, October 2011.
Robert Fragasso, CFP®, is chairman and chief executive officer at Fragasso Financial Advisors, a Pittsburgh-based investment and financial planning firm.  Due to industry regulations, comments are not permitted on this blog.  If you would like to contact the author, please email us at blog@fragassoadvisors.com.  Bob can also be reached for comment at 412-227-3200.

Posted in Uncategorized | Leave a comment

When We Achieve Our Goals, We Win and So Do Our Clients

Posted on October 3, 2011 by Loriann Ostermueller

Loriann Ostermueller
Loriann Ostermueller     Assistant Manager, Marketing

As part of employee incentives for meeting company-wide goals, Fragasso Financial Advisors (FFA) recently rewarded the staff with an afternoon at PNC Park, one of Major League Baseball’s most beautiful parks.  We took the afternoon to enjoy the park and the company of our co-workers while taking in the Pirates game.  The weather was perfect, and it turned out to be a great day all around (except for the fact that the Buccos lost the game!).  As you can see from these photos below, the Fragasso team truly enjoyed the day.

Since I joined the firm in 2005, FFA has provided many incentives for the firm to meet goals, and we’ve often been rewarded for our hard work throughout the years.  When the team meets the company-wide goal set for that quarter, we are rewarded with a company-sponsored perk.  Each quarter, employees are asked how they’d like to be rewarded if they meet their goal, and this year we chose a Pirates game.

While we all enjoy working together, it’s important for us to spend time together socially as well.  Studies show that company outings can boost employee productivity and job performance. In our case, it’s a win-win: the company shows us how much it appreciates us and values our hard work, so we work that much harder, which ultimately benefits our clients. We win, and our clients win.

The fact that Fragasso appreciates its employees is not lost on us, as illustrated by our firm having been named a Best Places to Work. An employee survey determines which companies earn the recognition, so it’s evident that we all truly enjoy working here!

Loriann Ostermueller is the Assistant Manager, Marketing at Fragasso Financial Advisors, a Pittsburgh-based investment and financial planning firm.   If you would like to contact the author, please email us at blog@fragassoadvisors.com.

Posted in Fragasso staff | Leave a comment

3 History Lessons from Past Recessions That Should Drive Investment Strategy Today

Posted on September 8, 2011 by Andrei Voicu

A once unthinkable downgrade of U.S. government debt became a reality earlier last month, triggering weeks of uncertainty among investors and daily market swings. The downgrade provoked a slew of deeper questions for many investors. You may be wondering how you’ll pay for your children’s college or whether you will be left with enough to retire comfortably.  These are good and very valid questions. Let’s break it down as I share our strategy for managing investments during a volatile time.

1.    Diversify
You’ve likely heard this before and it’s more important than ever as the financial market pendulum swings back and forth. In early 2011, we were concerned with unsustainably high levels of government debt combined with historic low interest rates. In response, we positioned our clients’ portfolios away from what we perceived as higher-risk, low-return Treasuries. While we have adjusted portfolios, we won’t ever try to time markets. That’s because our research has proven that most often, investors hurt their portfolios in the process. At Fragasso, we use time-tested principles of diversification and covariance to mitigate risk.  Quite simply, by not putting all your eggs in the one proverbial basket, you can potentially reduce the risk of severe consequences when the market turns.

2.    Don’t Overreact
While it’s important to keep an eye on what’s happening with your portfolio, our best advice is to remain focused on long-term investment objectives while maintaining sufficient liquidity for immediate needs. Be sure to discuss any changes you are considering with your financial advisor, who should have sufficient research and resources to help you make an informed decision.

3.    Learn from the past
Our advice during the 2007-2008 recession worked well for our long-term clients and we continue to stand by the fundamental strategies of diversifying, focusing on long-term goals and not trying to time the markets by jumping in and out at the wrong times. Current events, in our opinion, are nowhere near as severe as what we experienced just a few years ago. Markets recover and make progress, which is all part of the evolutionary cycle.

While none can predict the future, we see this as an understandable reaction to the uncertainty fostered by the ongoing budget and tax policy debate and the striving of the national and world economies to find equilibrium.

To learn more about Fragasso Financial Advisor’s wealth management philosophy, click here.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

Andrei Voicu is Managing Director and Chief Investment Officer at Fragasso Financial Advisors, a Pittsburgh-based investment and financial planning firm.  Due to industry regulations, comments are not permitted on this blog.  If you would like to contact the author, please email us at blog@fragassoadvisors.com.  Andrei can also be reached for comment at 412-227-3200.

Posted in Congress, Economy, Financial Advisor, Financial Planning, Investing, debt, debt ceiling | Leave a comment

Bob Fragasso meets with Congress members

Posted on August 31, 2011 by Robert Fragasso

In May 2011, 20 members of the Financial Advisor Council from the Financial Services Institute went to Washington to advocate for changing the new Department of Labor (DOL) rules that would redefine fiduciary definitions in the management of retirement plans. The ruling, as it is currently written, includes Individual Retirement Accounts (IRAs) and would, if adopted as is, dramatically change many Americans’ access to retirement advice.

As part of the Ohio/Pennsylvania team, Bob Fragasso met with four members of Congress, including two on the House Financial Services Committee.  “It was imperative that we alert members of Congress about the unintended consequences of the DOL decision. In my opinion, the abbreviated and erroneous assumptions used to arrive at the fiduciary standard ruling will have a major impact on the investing public. It’s well documented that many American households are woefully underprepared to meet the challenges of planning for retirement.  If the DOL ruling is not amended, lower-net-worth households will be cut off from receiving comprehensive investment advice at a time when the public is more confused than ever about where to turn for sound advice,” said Fragasso.

Bob stated, “The Financial Services Institute is 100 percent dedicated to representing investment advisors in Washington. It’s the only central voice for our community. If we can convince the government to focus more on creating standards for disclosure and transparency, then the public will be able to make more informed choices.”  FSI, founded in 2004, is the only advocacy organization working on behalf of independent broker-dealers and independent financial advisors.

Original interview was published in the FSI Voice, September 2011.

Robert Fragasso, CFP, is chairman and chief executive officer at Fragasso Financial Advisors, a Pittsburgh-based investment and financial planning firm.  Due to industry regulations, comments are not permitted on this blog.  If you would like to contact the author, please email us at blog@fragassoadvisors.com.  Bob can also be reached for comment at 412-227-3200.

Posted in Congress, Regulation, retirement | Leave a comment

Is Your Foundation or Endowment Vulnerable?

Posted on August 26, 2011 by Daniel Dingus

Some time ago, I blogged about the personal liability that comes with a nonprofit board position. I talked about how, with the recent market turmoil, board members have faced litigation. Individuals have sued because they believed the foundation’s endowment’s investment strategy was inappropriate, investments were illiquid or there was no investment policy.

Well, anyone who’s seen a television or even glanced at a newspaper over the last few weeks knows the markets remain volatile. That means board members will continue to face scrutiny, more so than they might normally, especially relative to any investment portfolio. And that makes this a perfect time to talk about ways board members can ensure they’re meeting their fiduciary responsibility.

Looked at another way, there are several points of vulnerability that may keep foundations and endowments from meeting their investment objectives. Many trustees don’t know that their endowment or foundation may be vulnerable.

From asset allocations that are not aligned with organization objectives to failure to adjust portfolio to change in objectives or market conditions (something that is especially critical now), we’ve seen multiple ways foundations miss their financial goals. Based on our experience at Fragasso Financial Advisors, we’ve identified 10 points of vulnerability.

Use the current market situation to your advantage. If you’re a board member or the executive director of a nonprofit foundation, read what we’ve identified to be the areas of most concern, and see where your organization falls. If you are not sure of some of those areas identified, give us a call. We stand ready to help.

For informational purposes only.  Neither Fragasso Financial Advisors nor LPL Financial offers legal advice or services.

Daniel Dingus is Managing Director and Chief Portfolio Strategist at Fragasso Financial Advisors, a Pittsburgh-based investment and financial planning firm.  Due to industry regulations, comments are not permitted on this blog.  If you would like to contact the author, please email us at blog@fragassoadvisors.com.  Dan can also be reached for comment at 412-227-3200.

Posted in Endowment, Foundation, Uncategorized, liability | Tagged , , | Leave a comment

How would I design a portfolio to generate income from a $500,000 nest egg?

Posted on August 3, 2011 by Robert Fragasso

This was exactly the question posed to me in an interview for Bankrate.com: How would I design a portfolio to generate income for a 70-year-old retiree with a nest egg of $500,000, and no other source of income?

As a certified financial planner with more than 39 years of experience, I know that there are currently plenty of theories about retirement planning out there, and a lot of them are untested. If you aren’t careful, these theories could be tested on you, the investor, maybe for the first time. My best advice for making the best decisions now, to make sure your savings are safe later, is to work with a trusted advisor who is managing by textbook principles and can knowledgeably guide you toward the realization of your goals.

It is also very important for the client to find a program that he or she agrees with and can stick with.  At Fragasso Financial Advisors, we specialize in creating long-term relationships with our clients, guiding them and managing their investment assets.

You can view the complete details of my portfolio recommendations in the Bankrate.com article.

Given the overwhelming range of retirement strategies out there for people to choose from, our clients find it comforting to know they are gaining experienced and assured guidance to the path that is right for them. We encourage you to contact us to ensure your investment portfolio is working hard for you.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

Robert Fragasso, CFP, is chairman and chief executive officer at Fragasso Financial Advisors, a Pittsburgh-based investment and financial planning firm.  Due to industry regulations, comments are not permitted on this blog.  If you would like to contact the author, please email us at blog@fragassoadvisors.com.  Bob can also be reached for comment at 412-227-3200.

Posted in CFP, Financial Advisor, Financial Planning, Investing, certified financial planner | Leave a comment

Why Work With a Certified Financial Planner?

Posted on July 26, 2011 by Melissa Richey

Choosing a financial planner may be one of the most important decisions you make.   A planner can play a central role in helping you meet your life goals and achieve financial well being.    Take the time to choose a planner who is competent and trustworthy, one of whom you can depend for professional and objective advice.  Your future depends on the choices you make.

People are pulled in so many different directions when it comes to their finances, but a CFP® professional is uniquely qualified to pull all the pieces together and provide a comprehensive evaluation that looks at the whole picture of a person’s financial life.

The public’s growing need for objective financial planning advice, has placed the CFP® certification at the forefront of the financial planning profession.

A Certified Financial Planner has voluntarily submitted to the rigorous CFP® certification process that includes “the four Es”:

•    Education
•    Examination
•    Experience
•    Ethics

Anyone can call themselves a “financial planner.” But only those who have fulfilled the certification and renewal requirements of the CFP Board can display the CFP® marks.  The CFP® certification ensures that the person you choose to help you plan for your future is competent and ethical. When you work with a CFP®, you are the focus of the financial planning relationship and your needs drive the recommendations.  CFPs follow certain practice standards – called Financial Planning Standards which are based on a six step financial planning process.  This holistic approach distinguishes CFPs from other professionals who typically focus on only one area of a person’s finances.  When you work with a CFP®, you can trust that you are working with an educated, experienced and ethical advisor who is dedicated to providing current, relevant and conscientious advice.

The CFP®‘s Code of Ethics ensures that practitioners are acting fairly and diligently when providing financial planning services – this puts the client’s interests first.  Look for a measure of the planner’s commitment to ethical behavior and adherence to high professional standards.  Look for a financial planner who will put you and your needs at the center of every financial planning engagement.  Most importantly, look for the CFP® or CERTIFIED FINANCIAL PLANNER marks.

To verify that your planner is authorized by the CFP® Board to use the CFP® certification marks, call toll free 1-800-487-1497 or visit www.CFP.net/search.

Copyright© 2002-2009, Certified Financial Planner Board of Standards Inc.  All rights reserved.

Melissa Richey is a Vice President at Fragasso Financial Advisors, a Pittsburgh-based investment and financial planning firm. She is also a registered representative with LPL Financial. Due to industry regulations, comments are not permitted on this blog. If you would like to contact the author, please email us at blog@fragassoadvisors.com. Melissa can also be reached for comment at 412-227-3200 Fee-based investment management and securities offered through LPL Financial. Member FINRA/SIPC.

Posted in Advisor, CFP, Financial Advisor, Financial Planning, certified financial planner | Leave a comment

Why There’s No Time Like Now to Begin Planning Your Legacy

Posted on July 14, 2011 by Deborah Graver

As a financial planner with nearly 20 years of experience and president and chief operating officer of Fragasso Financial Advisors, I have had the privilege to work with many clients at multiple points of their financial journeys. I have seen how hard they’ve worked, come to know the families they’ve nurtured and grown, and managed the assets they’ve accumulated.

Having built such close relationships with my clients, I know how important it is for many of them to leave a legacy for future generations. I want to be sure they do it in the most effective way possible, which is why I am advising my clients that now is the ideal time to plan for the transfer of wealth.

In December 2010, President Obama signed the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, extending the Bush-era tax cuts and offering additional benefits for estate planning purposes. However, the act is only in existence for 2011 and 2012.

We have provided details of the top wealth transfer strategies that you need to know about if you plan to transfer assets to future generations, including:

  • The tax-free transfer of wealth during an individual’s lifetime has been increased to $5 million.
  • The amount of money that married couples can pass on tax-free has been increased to $10 million.
  • The amount of money that can be gifted without paying any generation-skipping tax has been increased to $5 million.
  • The top estate tax rate for 2011 and 2012 is 35 percent.
  • The IRA charitable rollover has been re-established for 2011.

You can download our three-page paper detailing these tax advantages. If you are interested in learning more about how best to manage and transfer your wealth and want to work with a team of financial advisers who will make your financial success personal, we encourage you to contact us.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

Deborah Graver is the President and Chief Operating Officer at Fragasso Financial Advisors, a Pittsburgh-based investment and financial planning firm.  Due to industry regulations, comments are not permitted on this blog.  If you would like to contact the author, please email us at blog@fragassoadvisors.com.  Deborah can also be reached for comment at 412-227-3200.

Posted in Estate Planning, legacy planning, tax | Leave a comment