"Staying the Course" Isn’t a Snooze Button

Contributed by: Mallory Hunt

"The key to making money in stocks is not to get scared out of them." – Peter Lynch

When it comes to investing, the phrase "stay the course" is practically gospel. It's repeated in market downturns, shared in financial blogs (this may currently resonate…), and printed on motivational coffee mugs. And rightly so—emotional decisions are one of the biggest threats to long-term investment success. While staying the course is a powerful mindset for long-term investors, it can often be seen as a call for inaction, and you very well may be sick of hearing the phrase, but it's not inaccurate. Just like a plane on autopilot still needs a pilot in the cockpit, your portfolio still needs your eyes—just not your panic.

Staying the Course ≠ Doing Nothing Forever

Yes, staying invested during market volatility is usually the right move, but does that mean your investments should go untouched for decades? Of course not. Your financial life isn't static, nor is the world around you. Life changes. Goals shift. The markets evolve. And your investment strategy needs to reflect that. Think of your portfolio as a garden. Staying the course means letting your plants grow, not digging them up every time a storm rolls in. BUT it doesn't mean ignoring weeds, forgetting water, or never pruning. Good gardeners check in regularly—so should good investors.

This chart below, created by my colleague, Nick Boguth, effectively illustrates the undeniable relationship between risk and return. While drawdowns can be unsettling, we are here to provide guidance and support during these uncertain periods. However, it is important to notice that significant periods of volatility are often followed by substantial growth. The blue line below signifies how markets have continued to grow despite volatility and drawdowns (orange line). While those drawdowns can be deep and painful to live through in the moment, you can see that they tend to be only temporary

What Staying the Course Really Means

It means sticking to a well-thought-out plan, not ignoring it altogether. It means:

• Rebalancing regularly – Markets move, and over time, your portfolio drifts from its original allocation. Rebalancing brings it back in line with your risk tolerance and goals. Luckily, we are already doing this for you! We review accounts frequently throughout the year and rebalance when they deviate from your set goals.

• Reviewing goals and timelines – Are you still saving for that early retirement? Has your timeline changed? Are you nearing a big purchase? Your investments should reflect those life updates. Guess what? We do this for you, too! These items are usually discussed during your Annual Review Meetings with your planner.

• Avoiding emotional reactions – This one remains true. Don't let headlines or temporary downturns dictate your moves. We know this can be difficult, but again, staying calm isn't the same as being passive. We are always available to answer any questions that you may have.

The Bottom Line

Staying the course is about consistency, not complacency. The most successful investors stay engaged, review their plans periodically, and always keep the big picture in mind. So no, you don't need to micromanage your portfolio every week, but it shouldn't be stashed away or forgotten. Check in, stay informed, and above all else, trust the process.

Mallory Hunt is a Portfolio Administrator at Center for Financial Planning, Inc.® She holds her Series 7, 63 and 65 Securities Licenses along with her Life, Accident & Health and Variable Annuities licenses.

The information contained in this blog does not purport to be a complete description of the securities, markets, or developments referred to in this material. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete. Any opinions are those of Mallory Hunt and not necessarily those of Raymond James. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Every investor's situation is unique and you should consider your investment goals, risk tolerance and time horizon before making any investment. Prior to making an investment decision, please consult with your financial advisor about your individual situation.

How Much is Enough? Calculating Your Retirement Savings Goal

Contributed by: Josh Bitel, CFP®

Retirement may seem far off, but knowing how much you need to save is a crucial first step toward financial security. The answer to "How much is enough?" isn't one-size-fits-all—it depends on your lifestyle expectations, health, location, and longevity. However, there are some "rules of thumb" that can help you put a pulse check on your retirement plan:

Start with the 80% Rule

A common rule is that you'll need about 70% to 80% of your pre-retirement income to maintain your lifestyle in retirement. For example, if you currently earn $100,000 annually, plan on needing around $70,000–$80,000 per year after you stop working. This accounts for lower expenses—such as commuting, work clothing, or mortgage payments—but you may spend more on healthcare or travel.

Use the 25x Rule

Once you have your annual income target, multiply it by 25 to estimate your total retirement savings goal. If you need $70,000 a year, that means you should aim for $1.75 million. This rule is based on the 4% withdrawal strategy, which assumes you can withdraw 4% of your retirement savings annually without running out of money for at least 30 years, a popular strategy for estimating the strength of a financial plan.

Factor in Other Income Sources

Remember to account for other income sources like Social Security, pensions, or rental income. If Social Security is expected to provide $20,000 a year, and you need $70,000, then your savings only need to cover the $50,000 gap—meaning a goal closer to $1.25 million instead of $1.75 million.

Adjust for Inflation and Healthcare Costs

Healthcare expenses tend to rise with age, and inflation steadily erodes purchasing power. It's wise to build a cushion by overestimating your needs rather than falling short. Consider using retirement calculators or working with a financial advisor to model different scenarios.

Start Early, Save Consistently

The earlier you begin saving, the more time your investments have to grow through compound interest. Even modest contributions can grow significantly over time. Don't worry though, it is never too late to get started! If you start later, increasing your savings rate or delaying retirement by a few years can make a big difference.

Ultimately, your retirement goal should reflect your unique vision for the future. Take time to define that vision, crunch the numbers, and revisit your plan regularly. Your future self will thank you. And, of course, don't hesitate to seek advice from a financial planner if you are curious about your retirement path.

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Enjoyed this blog? Boost your financial confidence with our book, Finding Your Center: Achieving Confidence Through Financial Planning. Click HERE to learn more and get your copy.

If you're in the Metro Detroit area, join our book tour and receive a FREE copy!

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Josh Bitel, CFP® is a CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® He conducts financial planning analysis for clients and has a special interest in retirement income analysis.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of Josh Bitel, CFP® and not necessarily those of Raymond James.

Investing involves risk and investors may incur a profit or a loss regardless of strategy selected, including asset allocation and diversification.

Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Center for Financial Planning, Inc®. Center for Financial Planning, Inc.® is not a registered broker/dealer and is independent of Raymond James Financial Services.

Why Insurance Matters – And Why It Starts with You

Contributed by: Kelsey Arvai, CFP®, MBA

Life is unpredictable. While we can't foresee every twist and turn, we can prepare for what may lie ahead to help protect ourselves, our family, and our stuff. Insurance often serves as a crucial tool in this preparation, offering a safety net against unforeseen events. Before caring for loved ones, protecting your home, or building a legacy, you must take care of yourself because you are your most valuable asset.

Building wealth starts with taking care of your health. Medical costs remain the #1 cause of bankruptcy in the US, and rising medical expenses can feel overwhelming. Health insurance helps mitigate these costs, making healthcare more accessible and affordable. Even when health insurance does not seem worth the investment, it is hands down the most important one you will make over your lifetime. Being reactive with your health is often far more expensive, both financially and emotionally, than taking a proactive approach. Skipping annual check-ups, preventative screenings, or delaying addressing symptoms makes you susceptible to negative compounding effects on your overall financial well-being and future. The risk is clear—turning small, manageable health issues into major financial burdens. Without health coverage, the average cost of a three-day hospital stay in the US is over $30,000, not to mention the toll a hospital visit takes on other areas of your life. Health insurance isn't just about avoiding enormous costs; it's centered around making you the best and healthiest version of yourself. Building your financial plan around sustainable self-care is one of the most meaningful decisions you can make.

In essence, insurance is about risk management. It's a proactive approach to protect yourself and your loved ones from potential financial hardships. Disability insurance is often overlooked, yet it remains among the most critical insurance coverage, along with health and life insurance. Each is designed to ensure that you or your loved ones are provided for in the worst-case scenarios. Disability insurance provides financial support if you cannot work due to illness or injury, allowing you and your family to maintain your standard of living, despite challenging times. Regularly reviewing your insurance coverage, goals, and needs remains at the core of your financial strategy to ensure alignment.

Now that you and your loved ones are protected, we now turn our attention to your stuff and lifestyle. Stuff is everything from your home, car, vintage teacup collection, clothes, and personal belongings. When it comes to protecting your lifestyle and property, auto and homeowners' insurance/rental insurance are foundational—but the details matter. For our clients in Michigan and other no-fault states, please understand the importance of unlimited Personal Liability Protection (PIP) coverage. While recent legislation allows for lower coverage options, unlimited PIP remains the gold standard for safeguarding against catastrophic medical expenses following an accident—especially when considering lifelong care costs.

Whether you are a homeowner or renting, policy insurance requires intentional customization. Renters insurance is often overlooked, but it is an affordable way to protect your personal belongings and provide liability coverage if someone is injured in your rental—coverage your landlord's policy doesn't include. Standard policies often limit coverage on high-value items like fine art, wine, or other collectibles. To fully protect these, you'll need to itemize and schedule them separately, which may require formal appraisals and updated valuations every few years. Whether in Michigan or elsewhere, ensuring your policy reflects the full value of your lifestyle—not just your home or apartment's square footage—is a key part of holistic planning.

Umbrella insurance provides an extra layer of liability protection beyond your auto and homeowners/renters policies—offering you reassurance if you're ever involved in a major lawsuit. If you have significant assets, host guests frequently, or have young drivers in your household, consider implementing a policy. Property & Casualty insurance (auto, renters, umbrella, and homeowners) helps safeguard you, your family, and your stuff by ensuring your quality of life is not disrupted by unexpected damage or losses.

Lastly, let's discuss legacy and LTC coverage. According to the US Department of Health and Human Services, someone turning 65 today has nearly a 70% chance of needing some form of long-term care (LTC) services at the end of their life. Yet, it is very difficult and expensive to plan for. We often don't associate LTC with the legacy we hope to leave, but the two are deeply connected. Without a plan in place—whether through traditional LTC, a hybrid life/LTC policy, or a dedicated self-funding strategy—we leave ourselves vulnerable to preserving your financial legacy and easing the burden of your loved ones. Additionally, life insurance intended to cover legacy purposes offers comfort that your loved ones will be financially supported in the event of your passing. It can help cover funeral expenses and outstanding debts and provide ongoing income to your family.

The insurance hierarchy in your plan should reflect your values. Start by protecting yourself and your health, then protect your income and loved ones, your lifestyle and stuff, and finally, your legacy. Insurance isn't about fear—it's about caring deeply for the life you're building. Review your insurance coverage at least annually to identify if there are any gaps in your insurance coverage and assess where you are now. If there are gaps, strategize and implement coverage to ensure you are where you want to be.

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Enjoyed this blog? Boost your financial confidence with our book, Finding Your Center: Achieving Confidence Through Financial Planning. Click HERE to learn more and get your copy.

If you're in the Metro Detroit area, join our book tour and receive a FREE copy!

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Kelsey Arvai, MBA, CFP® is an Associate Financial Planner at Center for Financial Planning, Inc.® She facilitates back office functions for clients.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of Kelsey Arvai, MBA, CFP® and not necessarily those of Raymond James.

Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC. Investment advisory services are offered through Center for Financial Planning, Inc.

Center for Financial Planning, Inc. is not a registered broker/dealer and is independent of Raymond James Financial Services.

The Importance of Reviewing Account Beneficiaries and Account Titling Annually in Your Estate Plan

Contributed by: Sandra Adams, CFP®

When most clients think about their estate planning, they think about the actual drafting of the documents — their Wills, Durable Powers of Attorney, maybe their Trust. While the documents themselves are crucial components of a comprehensive plan, one often-overlooked step is the annual review of account beneficiaries and account titling to make sure they are consistent with the estate documents. Together, these two parts of the plan can significantly impact how your assets are distributed after you pass away, so it is vital to ensure they align with your overall estate planning goals.

Why Review Beneficiaries?

Beneficiary designations on accounts such as retirement plans, life insurance policies, individual investment accounts (Transfer On Death designations), and bank accounts (Payable On Death designations) supersede what is written in your will. This means that if your beneficiary information is outdated, your assets could go to someone you no longer intend to receive your assets or even unintentionally create tax liabilities or complications for your loved ones.

For instance, you might have named your ex-spouse as a beneficiary years ago. If you have forgotten to update your beneficiary designation, this could lead to a distribution that contradicts your current wishes (unless, of course, you still wish to leave money to your ex-spouse!). Annual reviews of these designations ensure that beneficiaries reflect your present intentions and changing life circumstances — whether it is marriage, the birth of a child, or the passing of a loved one.

The Role of Account Titling

Equally important is ensuring your account titling is consistent with your estate planning goals. Joint accounts, for example, can pass directly to the surviving account holder, potentially bypassing your will’s instructions. If your accounts are titled improperly, your assets may not flow according to your plan, leading to unintended tax consequences or family disputes.

By reviewing your account titling annually, you can confirm that your assets are positioned in the most effective way to meet your estate planning goals and minimize the risk of probate court or conflict.

Work with your financial planner to make sure regular reviews of both beneficiaries and account titling are a part of your annual estate planning review process to give you peace of mind and ensure your wishes are honored when the time comes. If you or someone you know needs assistance with an estate planning review, feel free to reach out — we are always happy to help. [email protected]

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Enjoyed this blog? Boost your financial confidence with our book, Finding Your Center: Achieving Confidence Through Financial Planning. Click HERE to learn more and get your copy.

If you're in the Metro Detroit area, join our book tour and receive a FREE copy!

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Sandra Adams, CFP®, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® and holds a CeFT™ designation. She specializes in Elder Care Financial Planning and serves as a trusted source for national publications, including The Wall Street Journal, Research Magazine, and Journal of Financial Planning.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of Sandy Adams, CFP® and not necessarily those of Raymond James. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors of RJFS, we are not qualified to render advice on tax or legal matters. You should discuss tax or legal matters with the appropriate professional.

Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC. Investment advisory services are offered through Raymond James Financial Services Advisors, Inc.

Center for Financial Planning, Inc. is not a registered broker/dealer and is independent of Raymond James Financial Services.

The Power of Working Longer

Contributed by: Nick Defenthaler, CFP®, RICP®

Saving 1% more towards retirement for the final 10 years of one’s career has the same impact as working one month longer. Yes, you heard that correctly. Saving 15% in your 401k instead of 14% for the 10 years leading up to retirement has the same impact as delaying retirement by only 30 days! Hard to believe but that’s exactly what the National Bureau of Economic Research found in their 2018 research paper titled “The Power of Working Longer”. To make your eyes pop even more, saving 1% more for 30 years was shown to have the same impact as working 3-4 months longer. Wow!

If you’re like me, you find these statistics absolutely incredible. This clearly highlights how big of an impact working longer has on your retirement plan. When you’re getting very close to retirement (usually 5 years or less), most of us won’t be able to make a meaningful impact to our 25-35 year retirement horizon by increasing our savings rate.  At this point in our careers, it just doesn’t move the needle the way you might think it would.  Without question, the best way you can increase the probability of success for your retirement income strategy in the latter stages of your career is to work longer. But when I say “working longer”, I don’t necessarily mean working longer on a full-time basis. 

A trend I am seeing more and more of that excites me is a concept known as “phased retirement”. This essentially means that you’re easing into retirement and not going from working full-time to quitting work cold turkey. We as humans tend to view retirement as “all on” or “all off”. That’s the wrong approach if you ask me. We need to be thinking of part-time employment as part of your overall retirement/financial game plan.  

Let’s look at this case study about Diane:

Diane, age 61 came in for her annual planning meeting and shared that the stress of her well-paying sales position was completely wearing her down. At this stage in her life and career, she no longer had the energy for the 50 hour work weeks and frequent travel. Now a grandmother of 3, she wanted to spend more time with her kids and grandkids but was fearful of how retiring at 61 compared to our plan of 65 would impact her long-term financial picture.  After further conversations, it became evident that Diane did not want to stop working completely; she just could not take the full-time grind anymore. When the pen was put to paper, it was concluded that she could still achieve her desired retirement income goal by working part-time for the next 3 ½  years (until 65 to get her to Medicare age).  Her income level would be dropping to a level that would not allow her to save for retirement at all, but believe it or not, that did not have a meaningful impact on her long-term plan! Earning enough money to cover virtually all of her living expenses and dramatically reducing portfolio distributions until age 65, however, was the key factor. 

Having conversations surrounding your desired retirement age is obviously a critical component to your overall planning.  However, a question that is sometimes overlooked that I like to pose is, “WHY do you want to retire at that age?”.  As a society, we do a good job of creating social norms in many aspects of life, and retirement is not immune to this.  I’ve actually heard several clients respond to this question and say, “Because that’s the age you’re supposed to retire!”.  When I hear this, I get nervous because these are the folks who usually make it 6 months into the retirement transition only to find that they are not truly happy. They found purpose in their career, they enjoyed the social aspects their job offered and they loved keeping busy, whether they realized it at the time or not. 

The bottom line is this – don’t discount the effectiveness easing into full retirement can have, both from a financial and lifestyle standpoint. Some clients have found a great deal of happiness during this stage of life by working less, trying a different career or even starting a small business they’ve been thinking about for years. The possibilities are endless.  Have an open mind and find the balance that works for you, that’s what it’s all about. 

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Enjoyed this blog? Boost your financial confidence with our book, Finding Your Center: Achieving Confidence Through Financial Planning. Click HERE to learn more and get your copy.

If you're in the Metro Detroit area, join our book tour and receive a FREE copy!

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Nick Defenthaler, CFP®, RICP®, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® Nick specializes in tax-efficient retirement income and distribution planning for clients and serves as a trusted source for local and national media publications, including WXYZ, PBS, CNBC, MSN Money, Financial Planning Magazine and OnWallStreet.com.

Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC. Investment advisory services are offered through Raymond James Financial Services Advisors, Inc. Center for Financial Planning, inc. is not a registered broker/dealer and is independent of Raymond James Financial Services. Every investor's situation is unique and you should consider your investment goals, risk tolerance and time horizon before making any investment. Prior to making an investment decision, please consult with your financial advisor about your individual situation. Neither Raymond James Financial Services nor any Raymond James Financial Advisor renders advice on tax issues, these matters should be discussed with the appropriate professional. This case study is for illustrative purposes only. Individual cases will vary. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Prior to making any investment decision, you should consult with your financial advisor about your individual situation. The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of Nick Defenthaler and not necessarily those of Raymond James.

How to Measure Your Financial Health Before Retirement

Contributed by: Kali Hassinger, CFP®, CSRIC™

Retirement can be one of life's most exciting milestones, but achieving it successfully requires careful planning and preparation. Whether you're a few years away from retirement, just starting to think about it, or already have a determined retirement date approaching, it's essential to evaluate your financial health prior to retirement. When clients approach the Center Team with retirement at the forefront of their minds, we work through a detailed and personalized financial planning process in order to determine if and when a comfortable retirement can become a reality.

The Financial Planning process includes a step-by-step review of all of the aspects of your financial life, including, but not limited to, the following:

Determine Your Retirement Goals and Spending Needs

I've often been asked, "How do I know when I've saved enough for retirement?" Ultimately, that answer is driven by what you plan or hope to do in retirement and how much that lifestyle costs! Sitting down to reflect on what you would like retirement to look like is an important part of the process. When you have outlined your goals and spending needs, you can begin the process to determine whether or not you've saved enough for retirement.

Develop a Net Worth Statement and Evaluate Your Retirement Savings

Of course, assessing the amount of savings you've accumulated for retirement is an important step in the financial planning process. It includes retirement plans like 401ks, IRAs, Roth accounts, and any other cash or investment savings you have earmarked for retirement. It's not uncommon for someone to have multiple accounts with the same tax treatment. Consolidating similar accounts can help you to feel organized, especially when these accounts are needed to create income in the future.

Other items to add to your Net Worth statement are any real estate, debts, business assets, or property.

Review Retirement Income

As mentioned above, your savings will be needed to create cash flow in retirement, but there are also other sources of income that must be reviewed and planned for. For many Americans, Social Security is often the largest source of fixed income in retirement. When to begin collecting Social Security is a very important decision that should be made with a deep understanding of the benefits and options. 

For those who have pension income, there are often decisions that must be made with those programs as well. Understanding the benefits and trade-offs between electing a pension over a lump sum option can help you to make the decision that is best for your lifestyle and retirement plan.

With these income sources in mind, we work with clients to develop a cash flow approach that incorporates and plans for tax implications, withdrawal strategies, and the longevity of your retirement.

Understand Your Investment Portfolio

As you approach retirement, you will want to reassess your overall investment portfolio, allocation, and strategy. While the set-it-and-forget approach may have been effective during your working years, managing your investment portfolio in retirement can require a more detailed methodology. Managing cash, your risk profile, and maintaining a balanced and diversified portfolio is important throughout retirement. Ultimately, your allocation should match both the amount of risk your plan necessitates and your level of comfort with investment risk.

Plan for the Unexpected

Retirement can realistically last 30 years or more! Think about your life and the world 3 decades ago. So much has changed and evolved that it can be hard to know what our lives could look like that far into the future. There will always be factors we can't control, but we can plan for those factors to the best of our abilities through insurances and an estate plan.  Additionally, our financial planning process incorporates possible market returns (including negative market environments) and the effects of inflation over time.

Determining your financial health before retirement requires a comprehensive review of all aspects of your financial life. The sooner you start this process, the better. By understanding where you are today, you can make any necessary adjustments to reach your goals. Financial planning is an ongoing process, and working with a financial planner can provide the planning and guidance you need to live your desired retirement!

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Enjoyed this blog? Boost your financial confidence with our book, Finding Your Center: Achieving Confidence Through Financial Planning. Click HERE to learn more and get your copy.

If you're in the Metro Detroit area, join our book tour and receive a FREE copy!

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Kali Hassinger, CFP®, CSRIC® is a Financial Planning Manager and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® She has more than a decade of financial planning and insurance industry experience.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of Kali Hassinger, CFP®, CSRIC™ and not necessarily those of Raymond James.

Prior to making an investment decision, please consult with your financial adviser about your individual situation. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Center for Financial Planning, Inc®. Center for Financial Planning, Inc.® is not a registered broker/dealer and is independent of Raymond James Financial Services.

What Financial Planning Really Means for You and Your Family

Contributed by: Kelsey Arvai, CFP®, MBA

Let me start by telling you what financial planning is not. Financial Planning is not one-size-fits-all. It’s not only for the wealthy. It’s not a one-and-done exercise. And it’s certainly not just about creating a budget or calculating your net worth. Comprehensive financial planning is deeply holistic. It often starts with the numbers (budgets, investments, retirement projects, etc.), but it is ultimately driven by every area of life: social, emotional, physical, and even spiritual well-being.

Building wealth over the long term incorporates aspects of not only financial strategy but also your relationships, mental health, lifestyle, and values. At its core, financial planning is about designing a life that speaks to you and what really matters to you and your family—spending time with loved ones, creating meaningful memories, and making your money work in ways aligned with your values. Time and energy are some of our most finite resources. The art of planning lies in striking the right balance between the two, along with our financial resources while navigating the ever-shifting demands of life. To quote our recent publication, Finding Your Center, which I will do throughout this blog: “The Center was built on a belief that people deserve more than financial advice—they deserve partners who listen.”

Even when you’re not quite sure what outcome you’re aiming for—or how you might get there, you and your family are the starting point. Your unique talents, desires, fears, values, and current life circumstances shape your financial strategy. Think of it like a fitness plan or a nutritional diet: the best one is the one that is tailored for you and your family. Financial Planning is a tool to help optimize your life, not just your portfolio. “True wealth is found in the freedom to live life on your terms, with clarity and confidence.” Whether that looks like living on $2,000/month or $200,000/year, the goal isn’t a specific dollar amount or net worth value. It’s that deeply satisfying sense of clarity, confidence, and calm that comes from designing a plan, following it, and living it. There is no crystal ball that can protect us from pain, fear, or grief. That’s not the goal of planning. “Financial planning isn’t about predicting the future. It’s about preparing you to meet it—wholeheartedly.”

Financial planning can have ripple effects in every direction: from saving for your children or grandchildren’s education to supporting your aging parents or grandparents to navigating windfalls or inheritances to hardships and difficult times. One of the greatest gifts you can give your family is not money; it’s clarity and confidence. “Our work isn’t just for today—it’s for the generations that come after, and the values they’ll carry forward.”

The clients we serve are diverse—young professionals, retirees, blended families, small business owners, your next-door neighbors, your kid’s teachers, and college graduates who are just starting out. “You don’t need to have it all figured out to begin. In fact, that’s why we’re here.”

At the end of the day, financial planning is about more than money, dollars, and cents. It’s about living with alignment and purpose. It’s about being proactive, not reactive, and finding freedom in structure. So, let me leave you with this question: What would it mean to you and your family to feel financially at peace? “Our greatest joy is helping people write their own definition of success—and walking with them as they live it.”

Are you curious about what a personalized financial plan might look like for you or your family? Let’s talk: Discovery Call with Kelsey Arvai, MBA, CFP®.

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Enjoyed this blog? Boost your financial confidence with our book, Finding Your Center: Achieving Confidence Through Financial Planning. Click HERE to learn more and get your copy.

If you're in the Metro Detroit area, join our book tour and receive a FREE copy!

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Kelsey Arvai, MBA, CFP® is an Associate Financial Planner at Center for Financial Planning, Inc.® She facilitates back office functions for clients.

This material is being provided for information purposes only and is not a complete description, nor is it a recommendation. Any opinions are those of Kelsey Arvai, MBA, CFP®, and not necessarily those of Raymond James.

Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC. Investment advisory services are offered through the Center for Financial Planning, Inc. The Center for Financial Planning, Inc. is not a registered broker/dealer and is independent of Raymond James Financial Services.

Helping Aging Parents: Financial Planning for Longevity

Contributed by: Sandra Adams, CFP®

More of us are living in a new reality. One in which we are working and caring for our own families while simultaneously facing the needs of aging parents. It is not uncommon that our older adult parents have simply "fallen" into their retirement without a real plan. Many became retirement age and decided it was time to retire without any real certainty that they had enough income and assets to support their plan for their lifetimes. In their minds, they felt secure with what they had, did not spend all that much, and would make it work — no worries. But now that you are more involved and are helping them as they get older, it worries you that they have never really planned. What should you do?

Just as you would think of planning for yourself to make sure that you are on track for your future financial goals, it makes sense to help your older adult parents get their financial ducks in a row. It is never too late for them to make sure they are on track and to adjust and find resources if they are not.

To start, it makes sense to find a financial planner who specializes in longevity planning to work with your parents. You will want to make sure that the planner will be able to review your parent's full financial plan (the technical side of the plan) in addition to looking ahead at aging plan considerations that may come into play for your parents in the future.

What should be included in the plan?

• Review of Net Worth and Financial Assets – it is important to review what assets are held, where they are held, and what the registrations of those assets are. It is here where we can identify opportunities for simplifying the investment assets holdings, inconsistencies in investment account registrations, etc.

• Review of Income, Cash Flow, and Debt Items – it is important to review where income currently comes from, how much income is needed to support normal cash flow needs, and any debt items. The more a client(s) have in guaranteed income sources (Social Security, pensions, annuity payments, etc.) towards their retirement income needs, the stronger their overall plan will be.      

• Review of Overall Retirement Cash Flows — the ability to fund their retirement incomes over time with the income and assets that they have available. Here, it is important to be realistic about future life expectancies, ongoing inflation, and returns on any investment assets that are available. The major unknown here is the possible need for Long Term Care in the future, especially if no Long-Term Care insurance is available.

• Review of the Investment Portfolio — for many older adults, we find that there is a measure of extremes. Either they have left their portfolios extremely aggressive from when they were working and never adjusted them, and thus they are taking on way more risk than they should be at their age and stage of life, OR they are extremely conservative and almost all in cash, CDs and bonds and they are at risk for not being able to keep up with the cost of living. Either extreme could be detrimental to a retirement plan long term.

• Review of Risk Management – review of insurances on an ongoing basis is more important than many people realize. This means everything from reviewing personal lines insurances to ensure that liability coverages are sufficient, to ensuring that life insurance policies are still relevant and understood, and that any riders on those policies are documented for future use (i.e., long-term care, etc.).

• Review of Estate Planning – reviewing and updating of estate planning documents on a regular basis is particularly important, especially as clients get older. Powers of Attorney should be regularly reviewed so that the older adult can ensure that those they have named are still the people they wish to manage their affairs if they cannot act on their own behalf. Trust and/or Will provisions should also be reviewed regularly to make sure that wishes have not changed and/or do not need to be updated. In addition, beneficiary designations and investment accounts should be reviewed regularly to make sure that they are consistent with your estate plan.

• Longevity Planning – Reviewing your current and future challenges, alternatives, resources, and desired experience as it relates to finances/money, housing, and care should be part of the planning with your older adult parents. Planning AHEAD is crucial here for both you and for them. For them, this gives them the most amount of control over their future aging life. For you, this helps you to help them plan, saves you from guessing their wishes, and helps make decisions easier as things change for them going forward. An aging plan should include some specific resources and action steps that can be reviewed and monitored as time goes on.

Since you are an active participant in your parent's care and their planning for the future, we encourage you to be a part of their planning process if they are open to that. Having open communication amongst the family as clients age makes the planning process a much better process for all involved. If helping your aging parents with longevity planning is something you are interested in doing, please feel free to reach out to us for help: [email protected]

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Sandra Adams, CFP®, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® and holds a CeFT™ designation. She specializes in Elder Care Financial Planning and serves as a trusted source for national publications, including The Wall Street Journal, Research Magazine, and Journal of Financial Planning.

The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of Sandy Adams, CFP® and not necessarily those of Raymond James. While we are familiar with the tax provisions of the issues presented herein, as Financial Advisors of RJFS, we are not qualified to render advice on tax or legal matters. You should discuss tax or legal matters with the appropriate professional.

Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC. Investment advisory services are offered through Raymond James Financial Services Advisors, Inc.

Center for Financial Planning, Inc. is not a registered broker/dealer and is independent of Raymond James Financial Services.

Social Security Taxation

Contributed by: Nick Defenthaler, CFP®, RICP®

In my experience, there is typically a high level of confusion when it comes to understanding how Social Security benefits are taxed (consumers AND many financial advisors!). Understanding how other forms of income interact with Social Security is imperative when constructing a tax-efficient retirement income for a client. As we'll explore in this article, the impact other forms of income can have on Social Security can often make or break a financial planning/tax decision in a given year.

Social Security Tax Basics  

Are you ready for your head to spin? The taxation formula and application of this formula for Social Security benefits is tricky! Let's start with the formula for what's known as 'provisional income' or 'combined income.' An individual's provisional income will then determine how much of their Social Security benefit will be included in their overall income for the year.

• Adjusted Gross Income (AGI) + tax exempt bond interest + ½ Social Security benefit = Provisional Income (PI).

What income counts as AGI? Great question! Income from pensions, annuities, employment wages, dividends, interest, capital gains, and pre-tax 401k/IRA distributions would all be included in AGI.

• Provisional income less than $25,000 for single filers, $32,000 for joint filers = $0 tax paid on Social Security benefits.

• Provisional income between $25,000 - $34,000 for single filers, $32,000 - $44,000 for joint filers, up to 50% of Social Security benefits will be taxable.

• Provisional income above $34,000 for single filers or above $44,000 for joint filers, up to 85% of Social Security benefits will be taxable.

Provisional Income Example

As you can see, there are many moving parts, so let's look at an example. Mark and Jenny have a pension income of $40,000, distribute $36,000 each year from their Traditional IRAs, and recently started their Social Security benefits, which total $50,000. To determine their provisional income, we would complete the following calculation:

$76,000 AGI (pension + IRA distributions) + $0 tax exempt bond interest + $25,000 (50% of total Social Security benefits) = $101,000 of provisional income.

Given $101,000 of income, $42,500 (or 85%) of Mark and Jenny's Social Security combined benefit of $50,000 will be included in their income for the year.

• Pension = $40,000

• IRA Distributions = $36,000

• Social Security = $42,500

• Total Adjusted Gross Income = $118,500

The IRS has a great resource on its website that will help you calculate your provisional income and help forecast the taxability of your Social Security benefit – click HERE to check it out.

Reducing Tax on Social Security

As you can see from the example above, increasing one's provisional income will inevitably increase the taxability (and possibly the rate of tax) of one's Social Security benefit. The timing of realizing income such as capital gains, IRA distributions, or Roth IRA conversions is all important when creating a well-thought-out income plan that takes Social Security taxation into consideration.

We have seen many examples before where, on the surface, a Roth IRA conversion appeared to make sense for a client, given their current tax bracket. However, after running the numbers and seeing how much their provisional income would increase as a result of the conversion, we ultimately advised against converting funds to Roth. In many cases, the increased taxability on Social Security benefits diminishes the value of a Roth IRA conversion and can even be the source of increasing one's Medicare premiums and subject you to 'IRMAA' (Click HERE to read one of my past articles on this topic).

The impact of taxes on Social Security is a very important aspect of your retirement income plan. There are multiple 'push and pulls' when determining how much tax you'll pay on your benefit. While quite confusing, it's critical your advisor understands these nuances to help ensure your retirement income stream is as tax efficient as possible!

Nick Defenthaler, CFP®, RICP®, is a Partner and CERTIFIED FINANCIAL PLANNER™ professional at Center for Financial Planning, Inc.® Nick specializes in tax-efficient retirement income and distribution planning for clients and serves as a trusted source for local and national media publications, including WXYZ, PBS, CNBC, MSN Money, Financial Planning Magazine and OnWallStreet.com.

Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC. Investment advisory services are offered through Raymond James Financial Services Advisors, Inc. Center for Financial Planning, inc. is not a registered broker/dealer and is independent of Raymond James Financial Services. Every investor's situation is unique and you should consider your investment goals, risk tolerance and time horizon before making any investment. Prior to making an investment decision, please consult with your financial advisor about your individual situation. Neither Raymond James Financial Services nor any Raymond James Financial Advisor renders advice on tax issues, these matters should be discussed with the appropriate professional. The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of Nick Defenthaler and not necessarily those of Raymond James.

Q1 2025 Investment Commentary: Diversification Results in Smoother Ride than Headlines Portray

Contributed by: Angela Palacios, CFP®, AIF®

Contributed by: Nicholas Boguth, CFA®, CFP®

The past few months have been a whirlwind—new leadership in Washington, escalating trade tensions, geopolitical conflicts, and market swings have dominated headlines. Even the Federal Reserve noted heightened 'uncertainty' after holding the Fed Funds Rate steady, and that might be an understatement.

The S&P 500 started out steady this year, gaining a few percent by mid-February and reaching a new all-time high! But the short-term whims of the stock market turned from that point as it fell sharply and briefly hit a 10% decline from its peak by mid-March (those famous "Magnificent 7" stocks got hit even harder, the notable one being TSLA that was down a whopping 53% from its high a few months prior). The S&P 500 ended at -4.5% this quarter.

While all that turmoil was occurring in the big U.S. stock names, international stocks were quietly having a fantastic quarter. The MSCI EAFE (a common stock index covering international stocks) was actually positive for the entire quarter, outperforming its U.S. counterpart by over 16% at times and ending the quarter at a positive +8%.

Bonds also did their job and provided the support we want to see during times of volatility, the Bloomberg U.S. Aggregate Bond Index added +3%.

If you were just watching the headlines, it may not have felt this way, but all of that adds up to a balanced portfolio* being essentially flat to start the year. U.S. stocks dragged down performance, while bonds and international stocks were additive. Our ultimate goal has always been to help you achieve your goals; therefore, we continue to focus on the risk reduction benefits of a diversified portfolio, and so far this year, the benefits of diversification have added up to a smoother ride.

*Morningstar's Moderate Allocation category average for the quarter was -0.3%.Source: Morningstar Direct.

Diversification

It is quarters like this that remind us why we invest in diversified portfolios and create a plan BEFORE there is market volatility.

Famed Nobel Laureate Harry Markowitz, whose investment principles still shape how portfolios are created today, said, "Diversification is the only free lunch in investing." We tend to agree, which is why we strongly believe in diversified portfolios. The only pushback I'd give is that it isn't "free"; it is actually very difficult for most investors to stay diversified. The hard part is that there is always a piece of your portfolio lagging, tempting you to second-guess it. Lately, that's been international stocks—but those who stayed the course just reaped the rewards of a quarter where international outperformed by more than 10%. Over the long haul, we believe diversification leads to favorable outcomes for investors, and we will continue to allocate accordingly.

Trade War Deja Vu

With all of the recent volatility directly induced by the trade war escalation, we have to look backward before deciding what, if anything, to do with portfolios. The most recent time period we have to look at from history is President Trump's first term when he tackled international trade, starting in late 2017 and continuing through into 2019. You can see that as various headlines escalated throughout the year, the market (the gray area) reacted mildly at first and even continued to climb higher through the summer as the war escalated. It is also important to remember that the volatility late in 2018 was not simply induced by the trade war. At the same time, the Federal Reserve (The Fed) took a tighter policy stance, increasing interest rates and giving forward guidance that it would continue to shrink its balance sheet.

The difference this time is we have lived through this before, so markets are reacting poorly and more quickly than they did before. Perhaps because they are remembering what happened in 2018 and the volatility we saw at the end of the year was still fresh in investors' minds. What is lacking in all commentary we read, though, is experts and investors forget we had a HAWKISH Fed that was raising interest rates then. Now, we have a Fed that is expected to cut rates later this year.

How We Are Trading It?

As we have warned previously, media headlines are often wrong or sensationalized. But this doesn't mean that we ignore them and what is happening. As an investment committee, we digest and step back to calmly make decisions when warranted. So, what have we been up to?

1. Taking profits in positions that have been big winners. This may look different depending on what stage of life you are in and your portfolio needs, but for all, regardless of stage, it's called rebalancing. Rebalancing isn't just a process, it can also be a very tactical tool. We have let our winners run for a long time; once they were overweight, we shifted from US Large cap to areas like bonds (big winners recently) and into areas that underperformed for years like international (also big winners recently). This was done much nearer the market top for US Large before the recent volatility occurred.

2. Lengthening duration in our bond portfolio now that intermediate term bonds are yielding more than short duration bonds. We harnessed that higher yield for your portfolio. Not to mention, some great price performance induced by market volatility recently too.

3. Raised cash for those in withdrawal stage. We did this early this year before the drawdown started. Taking advantage of a good start to the year for markets, we made sure people taking withdrawals had ample cash to fund future withdrawals, getting to sell while markets were up rather than being forced to sell down the road into weaker markets if they continued.

Remembering that portfolio management is not an "all or none" process is crucial. It is about positioning yourself to minimize emotional decisions so you can find the "opportunity" that exists in crisis. Stay tuned for more change to come in portfolios as we assess the consequence of tariffs, especially reciprocal tariffs, being put into place!

If you have questions, it is important that you reach out to your advisor.  We recommend stepping back to remember your investment goals and ask yourself if those have changed. Remember, when we are doing your planning work, we expect times like this to occur, "when, why, and how much" are the surprise but not the "if."  Our planning work knows this volatility occurs and builds cushion into your plan to be able to help manage periods like this.

Angela Palacios, CFP®, AIF®, is a partner and Director of Investments at Center for Financial Planning, Inc.® She chairs The Center Investment Committee and pens a quarterly Investment Commentary.

Nicholas Boguth, CFA®, CFP® is a Senior Portfolio Manager and Associate Financial Planner at Center for Financial Planning, Inc.® He performs investment research and assists with the management of client portfolios.

Any opinions are those of the Angela Palacios, CFP®, AIF® and Nick Boguth, CFA®, CFP® and not necessarily those of Raymond James. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. There is no assurance any of the trends mentioned will continue or forecasts will occur. The information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. Investing involves risk and you may incur a profit or loss regardless of strategy selected. The S&P 500 is an unmanaged index of 500 widely held stocks that is generally considered representative of the U.S. stock market. The Russell 2000 Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index, which represent approximately 8% of the total market capitalization of the Russell 3000 Index. The MSCI EAFE (Europe, Australasia, and Far East) is a free float-adjusted market capitalization index that is designed to measure developed market equity performance, excluding the United States & Canada. The EAFE consists of the country indices of 22 developed nations. The Bloomberg Barclays US Aggregate Bond Index is a broad-based flagship benchmark that measures the investment grade, US dollar-denominated, fixed-rate taxable bond market. Keep in mind that individuals cannot invest directly in any index, and index performance does not include transaction costs or other fees, which will affect actual investment performance. Individual investor's results will vary. Investing in oil involves special risks, including the potential adverse effects of state and federal regulation and may not be suitable for all investors. Past performance does not guarantee future results. Diversification and asset allocation do not ensure a profit or protect against a loss. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Past performance is not a guarantee or a predictor of future results. Raymond James and its advisors do not offer tax or legal advice. You should discuss any tax or legal matters with the appropriate professional.

The Magnificent Seven are a group of companies including Alphabet, Amazon, Apple, Meta Platforms, Microsoft, NVIDIA, and Tesla. Raymond James makes a market in these stocks. This is not a recommendation to purchase or sell the stocks of the companies mentioned.