Because of how dynamic the field of finance is, people are always in search of new insights. Finance advice from a professional might offer something new to a client, but more often than not, it’s going to be the same information they’ve heard many times before.
Professionals often offer tidbits of the current happenings in the field when asked for industry “secrets,” but evergreen insights provide a lot more actionable information for a client, even though they've probably already heard them a hundred times over. Here, 15 skilled financial professionals fromForbes Finance Counciloffer their favorite “best-kept-secret” finance tips that they typically like to share with their clients.
Members share their favorite financial tips that they share with clients.
Photos courtesy of the individual members.
1. Tune-Up Your Portfolio Allocations
Investors often overlook solid portfolio construction. Allocating your portfolio in a way that juggles all your objectives (risk/return targets, income requirements, etc.) can get tricky. Fortunately, there are technology-driven portfolio optimization tools that can help. Your optimal allocations evolve over time -- keeping an eye on them helps you ensure your portfolio is always in good shape. -Bernard George,Nvstr
2. Invest What You Can Afford To Lose
Don’t be afraid to invest. Many people will balk at the lack of liquidity and increased risk of investing their funds. However, in the long run, it’s the best way to increase your portfolio. Whether it’s real estate, cryptocurrency or traditional banking, do your own research. Don’t invest more than you can afford to lose, but don’t be afraid to take those opportunities. -David Gokhshtein,David Gokhshtein Inc
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3. Take Advantage Of HSA Accounts
Take advantage of health savings accounts (HSA) plans, if possible. There are multiple tax advantages. You contribute money tax-free. It's yours forever. It can earn compound interest over time. You can even invest some of the funds if you like. Money comes out tax-free for medical expenses. You can withdraw for non-medical at 65 with no penalty, only ordinary tax. You can use money in retirement toward Medicare premiums. -Danielle Kunkle Roberts,Boomer Benefits
4. Don't Accumulate Debt
Debt is the ball-and-chain that will keep you from growing your wealth. You have to be disciplined and not live outside your means. Aside from a mortgage, you shouldn't owe anyone anything. You can do this a number of ways. For example, pay cash for your car and maintain it for 20 years. Put the money you'd spend on a car payment in a Roth IRA. -Jeff Pitta,Medicare Plan Finder
5. Create A MOOSE
My tip is to create a MOOSE, which stands for a "Monthly Out-Of-Sight Expense." Essentially, this is where you create a "phantom" expense every month by deducting and saving $10, $20, $100 or whatever your cash flow allows. By creating this expense in your budget, you are actually paying yourself first for some future use. -Justin Goodbread,Heritage Investors
6. Put Your Money In A 401(k)
Put income into a traditional 401(k) -- you don't pay taxes on it and it's also hidden from creditors. If you want to buy stock in Amazon, you don't need $2,000 to buy one share. A 401(k) allows you to buy fractions of stocks. Your company may also match your contributions. Start small, with an amount you won't notice, and grow your wealth in one of the fastest ways possible: the 401(k). -Faith Keith,Leverage Retirement
7. Invest In Real Estate
There are lots of strategies, but a 1031 exchange in real estate allows you to defer paying capital gains taxes on an investment property when it is sold. Almost all high-net-worth individuals have investments in real estate and the 1031 exchange is one of the key tools. -JD Morris,Red Hook Capital
8. Get A Loan From The SBA
Get financing through the Small Business Administration (SBA). The SBA 504 and SBA 7(a) loan programs are the best-kept secret in small business financing and I believe more and more small business owners are waking up to this truth. The SBA is becoming more efficient in the time it takes to approve a loan, which means lenders, especially non-bank lenders, can move faster when it comes to funding those loans. -Christopher Hurn,Fountainhead Commercial Capital
9. Partner Tax Planning And Wealth Management
Partner your tax planning with your wealth management strategy. Many might think of tax and wealth management as exclusive entities in their lives, but the reality is they directly impact one another. Sit down with your financial advisor and your CPA to develop a plan that makes sense on all sides. -Ryan Hauber,Honkamp Krueger & Co., P.C.
10. Take Advantage Of Disruptive Credit Opportunities
Small businesses certainly don't want to overextend, but access to credit is critical to growth. There are companies that cater to startups and offer credit cards that don't require a personal guarantee or credit checks. It works like a charge card you pay off every month, while building credit for the business and earning the perks of any other credit card -- all without going into debt. -Maryanne Morrow,9th Gear Technologies
11. Remember That Life Insurance Policies Can Be Sold
Most professionals don’t realize life insurance is an asset that can be sold, especially if the policy owner no longer wants or needs their policy. A life settlement is an easy way for financial advisors to provide their clients with an innovative solution and differentiate themselves from other advisors at the same time. -Clay Gibson,Magna Life Settlements
12. Start Small To Build The Right Habits
No one saves a million overnight, and most can't go from saving 0% to 20% of wages. The best trick is to start small, saving just 1% so you can build a positive habit of saving in your life. Then you can slowly increase the percentage over time until you reach your goal of 20% or more! Once you see the savings accumulate you won't go back, but you need to start. -Vlad Rusz,Vlad Corp. USA
13. Budget And Don’t Overspend
It may sound basic, but overspending can create problems at all levels of wealth. While much of wealth management is about accumulating wealth, what you do with your wealth is an equally impactful discussion. Keeping a close eye on your day-to-day expenses may not be the most exciting part of your financial plan, but it is still crucial, whether you are just starting off or nearing retirement. -Sonya Thadhani Mughal,Bailard, Inc.
14. Measure Critical Key Performance Indicators
Having key performance indicators and metrics is the most efficient way to improve your business as you can then steer the ship in the right direction if it goes off-course. Having a tight handle on your KPIs and cash flow are the two most critical items when trying to push your business to the next level, which is why you need to invest in a higher finance skill set within your company. -Khurram Chohan,Together CFO
15. Visualize Each Dollar As A Soldier In Your Battalion
You must view each of your dollars as soldiers -- you are the general leading the battalion. When a soldier (dollar) is sent out, does it recruit more soldiers (asset) or die (expense)? When they need rest, do they continue onward to battle or recover (money spent when low or saved)? Like a seasoned general, view your money as your troops and maximize margins with strategy. -Sam Singh,CFObase
