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Feeling off balance? The Epley maneuver to the rescue

Feeling off balance? The Epley maneuver to the rescue

I believe in a mindful approach to life. I practice yoga. I meditate. And I try to make choices that are good for my mind, my body, and my spirit. So last Tuesday, as I found myself worrying about the election, I decided to avoid the hours (and hours) of news coverage and simply wait until morning to hear the final results. As I worked away on my computer (with the Wi-Fi off!), I could hear small tidbits of the reports from the living room where Rhoda was watching the news. The little I did catch sounded a whole lot different from what I expected, but I shut it out, went to bed at 10:00 as usual, and slept knowing that I’d cast my vote and that the final outcome was out of my hands.

On Wednesday morning, I rose quickly out of bed, and it hit me like a lightning bolt. Not the news of the election, but a severe case of an old, unwelcome visitor—vertigo was back. And it was bad. The room spun…and spun…until I was able to sit down before I fell down. Then the nausea hit me. I had tried to mentally prepare myself for the election outcome, but this physical ailment wasn’t on my list of things to deal with last week!

I am all too familiar with the terrible dizziness and queasiness of vertigo. Six years ago, a “T-bone” car accident caused floating particles in my inner ear to break loose, which is a very common cause of the vertigo condition I experienced after the wreck. But this time there was no determinable cause except for one: age. All I wanted was for the spinning to stop as soon as possible—and to stay away as long as possible! But every time I turned my head suddenly, stood up after a yoga pose, or simply got out of bed, the spinning was back in force. I dreaded every move because it seemed everything I did triggered an episode.

I’m not the only one feeling a bit traumatized after election night. My ailment was physical, but for many, the results of the election are causing people to take actions they know will only trigger another episode of upset. Just as my head is spinning, I see so many people exerting their precious energy on election results they can’t change. And the onslaught of news, emails, and social media are only feeding the flames of stress and alarm. It seems we all need a cure to get through it all, and I don’t believe focusing on the negative is the answer.

For my type of vertigo, there is a cure called the Epley maneuver. Performed by an audiologist, it’s a process that restores the floating particles in the inner ear to where they belong. Once the particles aren’t bouncing around in your ear canal and stimulating your nervous system, the sensation goes away. I was finally able to have this done yesterday, and after 20 minutes I was back on my feet again. No more balance issues. No more vertigo. As long as I sleep on my back for a few nights and don’t move my head quickly, I’m back on track. The confusion, disorientation, and dread are now history, but for the past week, getting my balance back was front and center in my life.

If the election results have you feeling off balance and worried about the future, now may be the time to find an Epley maneuver of your own. You might start by filtering out the noise from social media, the news (Why do we watch that stuff nightly before going to bed anyway?), and even the dinner table. With Thanksgiving coming up, you might start with a family rule about the table conversation—no politics or discussion on the election or the outcome. Consider replacing the politics discussion with each person around the table sharing a blessing. I am thrilled to hear Nina, my 7-year old granddaughter, share that she’s thankful for her family—especially at Thanksgiving.

For me, starting each day with yoga, meditation, and time with Rhoda helps me stay mentally and physically balanced. I wrote about my experience with yoga and the importance of focusing on controlling what you can in my blog Remember to Breathe. At the time, I was referring to investing, but I think the same guidance applies now. Shifting the focus to positive, healthy things and controlling what we can is a great way to find balance—no matter what challenges we face day to day.

Still seeking a way to restore your balance?  This email address is being protected from spambots. You need JavaScript enabled to view it.  to schedule a time to chat. I’m here to help. 

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Climbing the Wall of Worry

Climbing the Wall of Worry

Most investors have heard that “bull markets climb the wall of worry”—a phrase that refers to when investors continue to buy even when there’s a little (or a lot) to worry about. And it usually pays off. But how can you tell whether the stock market is in a bull phase that is “climbing the wall,” or whether the fear is justified and a bear market is just around the corner?

I’ve observed over the years that portfolios perform less well when worry and emotion are the guiding forces. (Which is the primary reason it makes sense to seek out an RIA firm to help guide objective investment decisions.) Today’s environment is full of worry. Brexit, interest rates, and the US Presidential Election have investors on edge, and investors are stressed. As a result, it can be difficult to remember this important reality: fear provides the best equity buying opportunity.

In periods of fear, Wall Street strategists have a poor record of recommending equities. They underweighted equities during the entire bull market of the 1980s and 1990s. Then they overweighted equities in the wake of the 2000 technology bubble, just in time for the so-called “lost decade in equities” when US stocks produced a negative return for more than ten years straight. Today is no different. Wall Street strategists are recommending the lowest equity allocation in the 30-year history of the data. And these recommendations are all rooted in fear. They did the same thing during and after The Great Recession (2008-2015). Those who went against the grain and took advantage of the opportunity to buy value-priced equities were handsomely rewarded.

Remember that long-term market trends are driven not by current events, but by the overall economy. From our perspective, the US economy is in pretty good shape looking forward:

  • The September jobs report includes many positive trends. More people are seeking work, a sign of growing optimism. The number of folks stuck in part-time work shrank as more of them landed full-time work. And the job gains were broad-based, showing up in many industries.

  • Inflation remains benign and interest rates remain low. However, the Fed has hinted that a small hike in the interest rate of ¼% is likely in December.

  • New motor vehicle sales are trending downa little to 17 million vehicles a year. However, that level of decline is to be expected after the large increase in sales the last few years.

  • Wages and personal income are seeing continued growth. This growth is feeding consumer spending, which lies at the core of the US economy. This dynamic is unique to the US. Australia, Brazil, and Canada are commodity-export driven. Russia’s economy is driven primarily by energy exports, and China’s is economy is driven by manufacturing exports.

  • No political leader has the power to strong-arm their ideas without the approval of Congress. Whatever happens on November 8, that balance of power should keep things in check.

All of these factors point to the fact that the US is in an under-recognized sweet spot right now. Many strategists and investors may be wearing blinders of fear at the moment, but I strongly believe that any short-term pullback in the stock market should be viewed as a buying opportunity—not a reason to run for cover.

Still worried about the economy?  This email address is being protected from spambots. You need JavaScript enabled to view it.  me to schedule a time to chat. I’m here to help.


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Money problems have you red in the face? It’s time to get out of the heat

Money problems have you red in the face? It’s time to get out of the heat

In my many years as an advisor, I’ve found that the hardest part of my job isn’t managing the numbers or dealing with the ups and downs of the market. What’s far more difficult for me is seeing a client get completely overwhelmed and embarrassed by money problems. Self-judgment. Guilt. Self-criticism. They can all rear their ugly heads. And perhaps the worst part of all is knowing that some folks are too embarrassed to share their money problems—even with their trusted advisor.

Last month, I had what seemed like an easy phone call with Jane. Her husband Gary is hoping to retire in the next few years, and she wanted to review their finances to see where they stood. The couple moved to Arizona two years ago after Jane received an early retirement package. With her husband’s $65K annual salary, her pension, and other investment income, their income is $90K a year. They owe $150K on their home, including a $110K mortgage and a $40K HELOC at 5.5% and 6% respectively. After running some ballpark numbers, I told Jane it looked like Gary could retire in about three years when he turned 65. According to my calculations, with Medicare reducing their health insurance costs and their combined pensions and IRA-401(k) withdrawals, they should be able to live quite comfortably.

The next day I received this email from Jane.

I was too embarrassed to tell you this yesterday, George, but our finances aren’t quite as simple as it seems. In fact, I expect Gary’s retirement will have to wait indefinitely as we’ve gotten ourselves into some pretty hot water financially. Our income simply isn’t enough to cover anything but our basic expenses, so we’ve used credit cards to cover ourselves. I’m mortified to tell you that we’ve racked up more than $30,000 in high-interest debt that is costing us more than $700 a month in payments. With that on top of our mortgage and home equity loan payments, etc., you can see why retirement is out of the question, at least for quite some time. We’re in a terrible mess. It’s so bad that we can’t even afford the $14,000 needed to repair our air conditioning—a tough situation in the Arizona heat. It hit 113 degrees here yesterday, but without the funds, I’m afraid we’ll just have to “tough it out.”

Though I doubt you can help at this point, I would appreciate your input. I'd prefer to communicate via email. couldn't listen to your kind voice, all I would hear is disappointment and pity. Just sending this email has me in tears.

It was heartbreaking to read her note. Clearly, Jane was terribly embarrassed about her situation—reacting as if she’d done something wrong or had gotten herself into this bad situation. While I was able to see the numbers as a financial puzzle to be solved, Jane viewed the situation as an insurmountable personal failure. The good news: I already had some very realistic solutions forming in my head. Of course, I had two distinct advantages that Jane didn’t. First, as an advisor, I’m experienced to see the forest—not just the trees. Second (and perhaps most importantly), since it’s not my own money we’re looking at, my perspective isn’t clouded by emotion and self-judgment, so I can be objective.

I immediately reached out to Jane (via email, of course!) to let her know that what she was facing was actually a small problem that she only perceived to be unsolvable. In fact, she had assets available that could be quickly and easily leveraged to address her needs. She called that afternoon, and together we kicked into gear. Here’s a high-level view of how we’ll turn down the heat:

On my recommendation, Jane immediately withdrew an additional $2,500 from the existing HELOC at the local bank. We added that amount to another $2,500 on her credit card to make the required $5K deposit on the much-needed AC repair to get it ordered. We then withdrew $14,3000 from her ROTH to cover the remaining cost of the air conditioner to get them out of the heat—literally—within the week. Whew!

We placed the remaining funds from the ROTH withdrawal into Jane and Gary’s checking account as an emergency fund to keep them from resorting to credit cards for future car repairs, home repairs, and other unbudgeted expenses.

To reduce their mortgage payments, we’re refinancing both the primary mortgage (5.5%) and the HELOC (6%) to an amortized 30-year fixed rate at 3.75%. This will reduce their payment from $1200 to less than $800 a month.

The next item on the agenda is to tackle their high-interest credit card debt, using a one-time withdrawal from Jane’s $800K IRA to pay it off. With the increase in expendable monthly income, they should be able to pay off the remaining of $11K in credit card debt by early 2017. If they’re short, we’ll make another withdrawal from the IRA next year. And they’ll keep $5,000 to $7,000 in the bank for emergencies so they don’t keep dipping into the credit card “well” to cover surprise expenses.

No matter how wise or successful you may be in other areas of your life, financial planning can feel like a dark, murky, mysterious world—and it can throw things out of perspective. To get through a trying financial situation, rest assured that no matter what your challenges, “toughing it out” may not be the only answer. Talk to a trusted financial advisor, get the guidance you need, and take control of your finances. It’s the best way to get out of the heat and stop sweating.

Feeling overwhelmed by a money challenge? Let’s schedule a time to chat and to get you on a better path forward.


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Post-Brexit: A new take on Independence Day

Post-Brexit: A new take on Independence Day

Ah, Independence Day! On Monday, most of us will hang out the flag, fire up the barbecue, and maybe take in a fireworks display. It’s the quintessential summer celebration in America. In Britain, not so much. Though July 4 has never given Brits a cause for joy, this summer the country has little to celebrate. The Brexit referendum has turned into a complex game of “he said-she said,” and at the moment it’s unclear how the whole thing will play out. As a result, companies are setting plans to flee the UK, the pound has hit an historic low, and analysts are predicting a near-certain recession in Britain.

The contrast to what’s happening in the US is acute. While the news of the ‘leave’ vote sent shock waves through Wall Street, the market has recovered at a speed almost as stunning as Brexit itself. After the news hit last Friday, the Dow ended down 602 (-3.5%) in one day. It was difficult not to assume the numbers would continue to fall. Instead, investors have voted that Brexit is simply no big deal…so far. As I write, the Dow is sitting just over 17,800 after a multi-day rally that has the S&P 500 less than 2% below it’s pre-Brexit close last Thursday. The ability of global markets to shrug off what many considered to be an economic disaster is the best evidence yet that investors may have finally learned one of the most important investment rules: don’t sell on bad news. Acting when you’re in a state of shock almost always has a regrettable outcome. To avoid costly mistakes, let the dust settle before taking action, and stay the course until any ramifications to your portfolio are clear.

I spoke with Jackie and Carl yesterday—long-term clients who have been retired just over 5 years. 42% of their portfolio is in stock, with the remainder in bonds and alternative investments. They’re taking a distribution of $2,500 a month ($30,000 a year) out of their $800,000 portfolio. That’s 3.8% of the $800K. As retirees, it would have been easy for Jackie and Carl to panic as the effects of the Brexit news played out on Friday. After all, they’re on a fixed income, and that $800,000 portfolio declined a little for a couple of days. But if 2008 had any positive value at all, it’s that it taught people like Jackie and Carl how to ride out a storm. When we spoke yesterday, they told me they’d been ready to batten down the hatches, but they weren’t overly concerned; they knew we’d structured their portfolio according to their needs, and they trusted its ability to survive the turmoil.

It was a smart decision. I compared the year-to-date performance of their portfolio last Thursday—just before the Brexit vote was announced—to where it sat on Monday evening—just after Friday’s and Monday’s declines of 602 and 150 points, respectively, that brought the total market decline to 5%. The good news: Jackie and Carl’s account declined just 2% during the same period. The portfolio was designed to survive the bump in the road. By the time the markets closed Wednesday, their overall portfolio was down less than 1% since last Thursday, and even better, it was actually up 3% YTD—more than enough to cover their withdrawals for the last six months and still add to their remaining balance. That’s something to celebrate on Independence Day!

As we head into the July 4th weekend, I’m reminded of the parallels between America breaking away from England in 1776 and Britain breaking away from the European Union today. If the Brits had a stock market 240 years ago and the news of America’s exit had reached the front page of The London Times, would their stock market have tumbled some 30% or more? Perhaps. But eventually things would have worked their way to a sensible conclusion.

Britain still has a lot of work to do to iron out Brexit and the resulting political and economic chaos. The European Union has some major repair work to do as well. In the near future, more pain is sure to come. Yet I expect that just as America and Britain both managed to thrive after 1776, the European Union and Britain will do the same—eventually. And so, I assure you, will the markets. “Keep calm and carry on”…and enjoy the fireworks!    


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The jobs report (and other news that doesn’t really matter)

The jobs report (and other news that doesn’t really matter)

It was 2008 in early October, and Rhoda and I were enjoying our last couple days of basking in the beauty of Yellowstone National Park—one of our cherished times away from the office. But suddenly everything changed, and our peaceful retreat was turned upside down. My phone rang, and when I answered I was surprised by the panicked voice of my newest client: “Get me out of this market George! You have to do something!” I had no idea what had happened. I told her I’d do some research and call her back right away.

Of course, if you’ve ever visited the Yellowstone Lodge (or any lodge in a large nature area), you know my first challenge. The Lodge has intermittent Internet on a good day, and this was anything but that. Just before the market closed that afternoon, the Treasury Department announced they were going to let Lehman Brothers “fail”. There would be no bailout. In its last 30 minutes of the day, the market dropped over 150 points. The media started shouting about the panic that would likely hit on Monday since Lehman Brothers wasn’t alone—many banks had problem balance sheets that were just as bad. This was unprecedented in my lifetime, and I knew then we were in for something steeper than even the tallest peak at Yellowstone.

There was little I could do except return to Denver to be here for my clients who were terrified of what this meant to their life savings and struggling hard to figure out what it meant to them and how to move forward. In less than 8 hours I was at my desk working to find a strategy—any strategy—that might be beneficial if and when the predicted panic hit. The one thing I was sure of is that I needed to persuade my clients not to sell. It would be like grabbing for a falling knife.

The Great Recession had its beginning on that day I flew back from Yellowstone. I couldn’t fathom then that the downdraft would last until the spring of 2009. Nor could I have predicted that that after hitting bottom at 6443 in March that year that the Dow would double in less than three years. The prognosticators kept predicting lower and lower stock averages even when the Dow was at 6443. Some panicked—and lost. Those who kept cool heads analyzed the big picture, determined the context and consequence of what was happening, and made careful choices based on the facts. They were the clear winners in the end.

What happened in those years is a constant reminder to me of how to approach current events—especially those that paint a potentially ominous picture for the stock market. Will China’s economic slowdown throw the US into recession? Are slowing new job numbers powerful enough to throw us off track? Can consumers keep up their spending growth? They’re all questions to consider, and in each case we need to take the time to make careful, thoughtful decisions and not fall into the reactionary mindset that the media loves to perpetuate. (For more on that timeless topic, re-read my blog Headlines sell—but don’t let them mislead you!)

The market is having some expected jitters after last week’s Bureau of Labor Statistics report that only 32,000 new jobs were created in May—nowhere near the expected 150,000 jobs. It’s good to note that the Bureau states that number is within 115,000 jobs of possible error. Here’s a great article in the Wall Street Journal on the huge margin of error—and frequent revisions—of payroll and other data. Even so, the important facts to keep in mind are these:

  • Job growth inevitably varies significantly from month to month, especially in a recovering economy such as this one.
  • In May, despite relatively meager job growth, unemployment decreased by 0.3% to 4.7%. That’s 484,000 fewer unemployed.
  • Wage growth is on the rise at more than +2.5%.
  • Job growth is “stronger for longer” in this recovery due to the depth of the last recession.
  • Job growth will decline as the unemployment rate sinks further and employers struggle to find enough skilled workers to fill available positions.


Putting these numbers in context is an important piece of the puzzle as well. Some parts of the country, including Colorado Springs and Denver, are reporting a shortage of skilled labor in construction—a challenge that is holding back major construction projects. Health care, technology, and accounting are just a few examples of fields that have a bright future for jobs. At the same time, non-skilled workers are hurting, and pending minimum wage increases in many states and cities have employers on a mission to automate hourly-wage jobs.

All of this is important information, but economic growth is still driven primarily by consumer spending—and spending requires discretionary income that results from an increase in total income. Looking at changes in average or median income is fine, but ultimately it’s the change in discretionary income that matters most to the economy.

No matter how the market reacts to the job numbers—or changes in interest rates, or China’s economy, or the upcoming election—keeping these individual factors in perspective is key. To keep a cool head, look at the big picture, analyze new information with care, and keep your eye on the big picture. Speaking from experience, it’s the easiest (and often the most lucrative) way to take on even the tallest mountains.


Need help analyzing new information to be sure you’re on track for the future?  This email address is being protected from spambots. You need JavaScript enabled to view it.  to schedule a time to chat.    


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I believe in a mindful approach to life. I practice yoga. I meditate. And I try to make choices th...