Making It, Keeping It, Growing It

The rules of the road for the new investor

Rule No. 1: Never lose money. 

Rule No. 2: Never forget rule No. 1. — Warren Buffett

While playing golf with a good friend of mine the other day, the conversation turned towards his son’s upcoming graduation from the University of Texas at Austin and how the time is now to provide smart financial advice to prepare for the “real world” — having a job, saving money and covering his expenses. The conversation reminded me that even if you are a novice in the world of managing your wealth, thinking strategically about how to manage wealth is important from the day you receive your first paycheck.

The phrase ‘wealth management’ may sound more complicated than it actually is. Perhaps it sounds like something only reserved for someone who has saved for years? The reality is the moment you start working in the real world you have the opportunity to actively manage and plan for the future. Those who throw financial management to the wind often find themselves with challenges down the road that they are unprepared for financially. These challenges could prevent them from having the lifestyle they may have dreamed about. As I tell my clients, “dreams and financial strategies need to go hand-in-hand.”

Here are the 5 essential tips I recommend to young and new investors to proactively build financial well being:

Tip 1: Have liquid savings

Illiquidity is a word in personal finance that does not inspire warmth or confidence. Property and jewelry are two examples of illiquid investments that many rich and famous individuals are known for having. I also believe that it is very important to have cash savings tucked away in a safe place for any emergency you may encounter. I often suggest that my clients set a consistent goal of saving, for instance putting aside a minimum of 20% of their income each month. Often there is an instant feeling of self-confidence when there is cash in pocket. Having more cash available as opposed to the imbalance of only illiquid investments is preferred.

Tip 2: Use credit only when you can pay on time

Part of wealth management is to know how to use credit wisely so that it can be used to your advantage. Credit includes unsecured loans, mortgages and, of course, loans for bad credit. Paying back your credit on time is absolutely crucial, which is why only using credit that you can pay back in full each month is very important. A credit history showing that you applied for credit and repaid it on time helps to build a solid financial track record that future lenders will consider.

As clarification, I am not suggesting that it is bad to use credit cards; but using credit for impulse spending that you cannot afford without paying interest is unwise. Interest quickly adds up and sinks you deeper into debt, which can sabotage your wealth management plan.

Tip 3: Have an achievable goal in mind

Wealth management also involves knowing your goals. If you dream of owning a home or if you want to buy a car, you need to plan for the cash needed for big-ticket items. While it may be nice to dream of buying a home or even a luxury vehicle, it is foolish to dream without planning how to build wealth to pay for that dream. Every dollar spent by mortgaging your future and happiness can lead you to a life of financial misery.

Tip 4: Start planning for retirement

Retirement should be on your mind even if you are just dipping your fingers into wealth management. While many people who are approaching retirement age are thinking about the various ways they can afford to retire, many young people do not see the value in saving for retirement until later in life. However, with the cost of living high and people living longer, any money saved needs to stretch.

By incorporating your desired lifestyle and dreams into your retirement and wealth management plan now, you can reap the financial benefits later when you really need them.

Tip 5: Create a long-term strategy

Wealth management should not only be about wealth creation, but wealth preservation as well. The long-term view is better than short-term “get rich quick” schemes, which plague some wealth management beginners.

As an investor, you should be focused on creating a long-term strategy that can secure rewards for you in the future. A long-term strategy might include interest-bearing savings, investments in property, and investments in the stock market, depending on where your interests lie, your risk tolerance, and investment horizon.

Your advisor can create a road map that will help you think ahead to life events like marriage, children, school tuition, and more. Stay engaged in your investments and be involved in the decision-making process, but do so with a private wealth advisor so that you have a professional helping you make big decisions.

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David Osborne is the founder of Osborne Advisors, an independent private wealth management firm offering wealth management to high net worth individuals, families, estates and corporations since 1999. An extension of Osborne Advisors, Osborne Advisors Pro, is a sports wealth management offering created solely to focus on the unique financial management needs of professional athletes and coaches.

This article was written and prepared by Red Fan Communications (Austin, TX, 512.551.9253) and David Osborne. David Osborne is a registered representative and registered investment adviser representative of SWS Financial Services, Inc., a member of FINRA and SIPC and a registered broker dealer and registered investment adviser who does not provide tax or legal advice, located at 1201 Elm Street, Suite 3500, Dallas, TX 75270, 214.859.1800. Though information provided in this article was prepared by sources believed reliable, SWS Financial Services, Inc. does not guarantee its accuracy or its completeness. This article may not be duplicated or redistributed without the prior consent of SWS Financial Services, Inc. Red Fan Communications is unaffiliated with SWS Financial Services, Inc.

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Animal News

Advocates find false info being fed to Texas legislators on pet store law

Puppy mill dogs do not have a great life.

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A national pet store chain has been implicated in a dishonest campaign to try and influence Texas lawmakers on an upcoming bill making its way through the legislature.

The pet store chain is Petland, and they're engaged in a battle against The Ethical Pet Sale Bill (SB 1652 / HB 3458), which would encourage pet stores to stop selling at-risk animals from puppy mills and support shelters and rescue groups instead.

The Ethical Pet Sale bill has support from rescue and animal groups across Texas, who are all grappling with a glut of animals on the streets and in overcrowded shelters. That pet overpopulation problem gets even worse when pet stores import more animals from puppy mills in states like Missouri and Ohio.

If Texas passes the bill, it will join a growing number of states and cities who've already passed similar laws including Dallas, Austin, Bryan, College Station, El Paso, Euless, Fort Worth, Houston, New Braunfels, Pasadena, San Antonio, The Colony, Sherman, and Waco.

Most reputable pet store chains such as PetSmart and PetCo do not sell cats and dogs. Petland does. The company operates 84 stores in the U.S., and fights bills like this by hiring lobbyists to discourage legislators from supporting these bills.

Phony list
In this case, a two-page summary was distributed to some Texas state senators listing reasons why they should oppose SB ("The evidence from other states, especially California, demonstrates that these types of bans do more harm than good"), plus a list of organizations that are opposed.

Most of the organizations opposed to the bill profit directly from animals, such as Petland and Puppy Dreams, a North Texas chain that also sells animals.

But the list also had surprising names including PetSmart, PetCo, and Pet Supplies Plus — the three largest pet store chains who all have a history of supporting adoption of shelter animals.

Their presence on the list caught the eye of animal advocacy groups such as Texas Humane Legislation Network and Humane World For Animals, who've worked with the big three in the past.

"We became aware of Petland Inc.’s lobbyist apparently sharing the attached document with legislators, claiming the listed pet and pet product industry leaders are opposing this legislation," said a spokesperson from Humane World of Animals (HWA). "We checked in with contacts at Petco, Petsmart, and the American Pet Products Association, and all of them deny opposing this legislation or giving Petland permission to list them on this opposition letter. It’s very possible others listed in this letter also did not give their permission to be included — we only connected with the those listed above at this stage."

CultureMap also contacted the three major pet store chains and received similar responses that they had not been consulted nor did they issue a rejection of the bill, although none wanted to be quoted.

The misrepresentation is concerning because it muddies the water with false information at a time when the bill is still under consideration:

HB 3458 — the version going through the Texas House — passed a House Committee with a 10-1 vote and has been moved up the chain towards passage.

SB 1652 — the version going through the Senate — still needs to get through the Senate Committee, Calendars, and a floor vote.

"By creating a false narrative about the position of the above industry leaders, this letter has the potential to sway lawmakers at a critical juncture in the legislation’s journey," the HWA spokesperson says.

Two Petland stores in the Dallas area — in Frisco and Tyler — have been the subject of undercover investigations. Petland Webster recently settled a lawsuit with several families that the store allegedly sold sick puppies to, and several lawsuits have been filed against Petland Woodlands in Texas, claiming the store sold sick puppies. One pet owner told the House Committee that he'd spent $20,000 on medical care of a puppy he bought at a pet store.

"Banning the retail sale of puppies and kittens is a common-sense solution to protect both animals and Texas consumers," said Dean Senator Judith Zaffirini of Laredo, who filed the bill. "My SB 1652 would help reduce pet overpopulation, promote responsible breeding practices and prevent families from unknowingly purchasing sick animals. With varying local ordinances in place and further action at the city level now restricted, it is important for the state to provide a clear and consistent approach that prioritizes both animal welfare and consumer protection."

politics animals