There May Be More to Kids’ Movies Than You Think!

Sara Craven

In my house we are running either the theme song from The Lego® Movie or the hit ballad from Disney’s Frozen on a continuous dizzying loop. Either my daughters are parading around the kitchen with their princess capes on - “letting it go” - or my son is pumping his fists in the air shouting “Everything is AWESOME.”  Both songs can serve as appropriate lessons for personal financial management, and while I’ll refrain from specifically addressing   sister princesses, a snowman named Olaf and animated Legos, I think a corollary can be drawn to the benefits of seeking professional financial advice, and the power of your team.  

The theme song from Disney’s Frozen, “Let It Go,” underscores the emotional fears that control us and prohibit us from effective decision making. Only by letting go can we create emotional distance and become more “powerful” – and effective.

Markets, especially volatile ones, have the power to influence investors’ behavior; they can lead some investors to make poor or at least ill-timed investment decisions, inconsistent with their long term objectives. These emotional decisions can have a lasting impact on investment success over time. When emotions guide your investment decisions, many times you’ll end up in an emotional trading trap.  Consider these scenarios:

• Say you sold everything to avoid a market sell-off - Congratulations! If you were lucky enough to time that step right, the decision of when do you buy back in is no easy trick. What clues and trends will guide you through this very emotional predicament? Investors can remain frozen for extended period, perhaps even entirely missing the benefits of a market recovery.

• Woohoo! The market is “ripping” and you buy because you “want some of THAT” - only for the market to begin a consolidation on bad economic data.   What now?

It’s extraordinarily difficult to take the emotion out of such decisions. Professional investment advisors are trained to “wring out” the emotional distractions and exert the discipline needed to act in a contrarian way and resist following the crowd. ”Herd mentality” is usually what drives decisions when emotions run high. So what do people do in such periods?  They tend to buy when the world and markets are looking strong, and sell when markets have turned negative – in other words: buy high, sell low.

You may want to “let go” of those emotional traps (at least a little) by hiring a professional manager, who has the discipline to manage your portfolio unemotionally and keep your strategy on track.  No one completely escapes the angst, but minimizing it helps.

Enticing to another audience, Warner Brothers’ The Lego® Movie theme song, “Everything is Awesome,” subtly emphasizes the power and capabilities of a unified team.  Like the Lego team, if your team of advisors works well together, they can meaningfully improve your outcomes.   To effectively protect your assets, they collectively and individually put a structure and strategy in place for you. Often, investors think of their attorney, CPA, insurance agent, or investment advisor by their respective specialties rather than as members of a cohesive team, working in harmony to construct, implement and manage their long term financial plan.  Each of these specialists influence and help develop your optimal, individualized plan, geared to your circumstances and vision.  It may even make sense to supplement the team with a banker, philanthropic advisor and/or real estate agent.  Coordinating the team is often the job of your “wealth manager,” since that person is likely to be most frequently in touch, given the day-to-day nature of their work.  Just as a team of medical specialists can best address your health and wellness, your team of financial specialists working together will build, integrate and manage your plan to steward your wealth.   Understanding the role of each core member helps clarify how the pieces fit together:

Financial Advisor: Long term wealth solutions via financial planning and investment management for you and your family;

Estate Planning Attorney: Asset protection and providing for your family after you are gone;

Tax Advisor: Tax preparation and related planning strategies and expertise;

Insurance Advisor: Risk management strategies and asset protection.

In my personal experience, I have learned that teamwork strengthens the unique services of each member of the team.  We work together in congruency with a client’s many moving pieces. Such an arrangement assures that I have a full understanding of your overall circumstances.  That allows me to customize (really optimize!) the work I do for you.

Importantly, I can help fill gaps in your team by providing referrals to able members of the professional community.  I work closely with your outside legal, accounting and insurance professionals to effectively integrate these areas into your plan. Your professional team is greater than the sum of its parts.  They collectively provide integrated expertise and discipline for your benefit.  

Like Legos, your team is a master creation of building blocks stacked into place for you and your family. The emotional stress of personal investing is eliminated so that you can “Let It Go” and enjoy other important aspects of your life, knowing your professional team is hard at work. 

The bottom line?  Surround yourself with experts - it’s a formidable team.

 

“Everything is Awesome” music and lyrics by Tegan and Sara, The Lego® Movie 
"Let It Go" music and lyrics composed by Kristen Anderson-Lopez and Robert Lopez, Frozen

This information has been developed internally and/or obtained from sources that Sand Hill Global Advisors, LLC (“SHGA”), believes to be reliable; however, SHGA does not guarantee the accuracy, adequacy or completeness of such information nor do we guarantee the appropriateness of any investment approach or security referred to for any particular investor. This material is provided for informational purposes only and is not advice or a recommendation for the purchase or sale of any security. This information reflects subjective judgments and assumptions, and unexpected events may occur. Therefore, there can be no assurance that developments will transpire as forecasted. This material reflects the opinion of SHGA on the date made and is subject to change at any time without notice. SHGA has no obligation to update this material. We do not suggest that any strategy described herein is applicable to every client of or portfolio managed by SHGA. In preparing this material, SHGA has not taken into account the investment objectives, financial situation or particular needs of any particular person. Before making an investment decision, you should consider, with or without the assistance of a professional advisor, whether the information provided in this material is appropriate in light of your particular investment needs, objectives and financial circumstances. Transactions in securities give rise to substantial risk and are not suitable for all investors. No part of this material may be (i) copied, photocopied, or duplicated in any form, by any means, or (ii) redistributed without the prior written consent of SHGA.