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Improving Investor Behavior – Hindsight in 2020

Marquis displaying "The World is Temporarily Closed"

Note

This article originally appeared in the Denver Post, December 20th, 2020.

They say hindsight is 20/20, and as we make the year 2020 hindsight, it’s a good time to reflect. What did we learn? What surprised us? How can we use our past to make our future bigger and better?

It was former Secretary of Defense Donald Rumsfeld, who said it’s the “unknown unknowns” that get you. Unlike a “known unknown,” something we expect but don’t quite know the outcome, an unknown unknown is something no one could have predicted. The election was a known unknown: somebody would get elected; we just weren’t sure who. The circumstances may have been unusual, but there was going to be an outcome that we could anticipate.

An unknown unknown is something like COVID-19: something that comes out of left field and creates uncertainty through its mere existence. We did not understand its nature, the impact, the contagiousness, how to treat it, who would be the most vulnerable, what the effect would be on our healthcare system or how people would react to it. Even ten months later, there is still much we don’t know. Read more

Steve Booren

Steve Booren

Steve Booren is the Owner and Founder of Prosperion Financial Advisors, located in Greenwood Village, Colo. He is the author of Intelligent Investing: Your Guide to a Growing Retirement Income and a regular columnist in The Denver Post. He was recently named a Forbes Top Wealth Advisor in Colorado.

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What Are You Doing on November 4th?

Capitol Building

Election Day, Tuesday November 3rd, is only a week away. While 2020 has been historic, it seems that everyone has a dramatic expectation of what will happen in the investment markets, as if it will be the “next” big 2020 disruption.

This morning I scheduled an appointment with my dentist. While the office’s operations coordinator looked at the upcoming weeks, she asked me “What are you doing on Wednesday 11/4?” Obviously, she was inquiring about my availability, but given that I have been thinking about and discussing the elections and markets with regards to next week as often as I have, my first response was….”I’m going to take a deep breath and proceed with my regular Wednesday routine.” As you can imagine, she was a bit confused by my answer, and expected me to discuss times that I could make it in to the office. I apologized as I laughed with her, and explained that the response was automatic with regards to the election and the investment market conversations I had been having around the same time period.

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Pat Alfano

Pat Alfano

Pat joined the Prosperion Financial Advisors team in August 2017 as a part of the Anderson team, and brings ten years of experience in the financial services industry. Starting out as an “advisor to advisors” in 2007, Pat developed his industry experience by helping advisors bring solutions to their clients with mutual funds, separately managed accounts, insurance based products, and employer sponsored retirement plans. Pat started working with clients of his own in 2015 as an advisor to individuals and institutions, and has enjoyed being able to deliver goal focused results. As an advisor, Pat believes that every individual and group deserves quality financial advice and planning regardless of their stage in wealth accumulation or distribution. As an advisor, Pat develops customized strategies for individuals and organizations in light of their unique goals and aspirations.

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Improving Investor Behavior: Keep Politics Out of Your Portfolio

I voted stickers

Note

This article originally appeared in the Denver Post, September 20th, 2020.

With the election a short 45 days away, the news stream is unrelenting. Political TV ads, postcards, and of course those phone calls during the dinner hour – it’s an all-out media assault designed to convince you that if the “other guy” gets elected, the world is sure to end. It’s enough to elicit one of three emotional responses: either anger and outrage toward the opposition and confirmation bias toward your selection, utter fear and terror at what may or may not happen, or complete apathy toward the whole process. Regardless of where you stand, it’s important to recognize the effect that this election might have on your portfolio… or lack thereof.

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Steve Booren

Steve Booren

Steve Booren is the Owner and Founder of Prosperion Financial Advisors, located in Greenwood Village, Colo. He is the author of Intelligent Investing: Your Guide to a Growing Retirement Income and a regular columnist in The Denver Post. He was recently named a Forbes Top Wealth Advisor in Colorado.

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Does Your Business Need a LIFT?

Balloons

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This article originally appeared in ColoradoBiz Magazine, Sept. 1, 2020.

If COVID has brought anything to business owners’ attention, small and large alike, it’s the need for a financial plan before bad news drops. A year ago, the likelihood of a worldwide pandemic effectively shuttering business in the U.S. for six months seemed so outlandish that had you suggested it; you would have been laughed out of the room. In hindsight, that suggestion would have made you look like a genius or a prophet.

My point is this: every business needs a financial plan to help guide and keep them afloat no matter how good times may be or how plentiful the work may appear. In reality, it’s no different than the financial suggestions we impress upon our clients. As an independent advisor, I run a business and help my clients think about how they run theirs.

So, what have the impacts of Covid-19 taught us from a business perspective? What should businesses consider as they navigate through today and plan for the future? As I look back over the past five months, I see four key actions to take now to “LIFT” businesses.

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Steve Booren

Steve Booren

Steve Booren is the Owner and Founder of Prosperion Financial Advisors, located in Greenwood Village, Colo. He is the author of Intelligent Investing: Your Guide to a Growing Retirement Income and a regular columnist in The Denver Post. He was recently named a Forbes Top Wealth Advisor in Colorado.

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Improving Investor Behavior: Reframing Your Business Mindset

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This article originally appeared in the Denver Post, August 16th, 2020.

For business owners, improving investor behavior can mean more than a focus solely on financial instruments. The intent of this column has been improving investor behavior, which often discusses market investments like equities, bonds, and other financial assets. But it’s important to consider how our investor behavior applies to other critical areas of our lives, namely in the ownership and running of a business.

As an independent financial advisor, I’m in a unique spot. I own a business and am responsible for running that business while helping my clients think about running theirs. I have a dual perspective, both as an advisor and as a business owner. So this week, I want to cross over into the business world and encourage you to consider how your investment behavior (i.e., the beliefs and attitudes you have about your business) and possibly the most valuable asset you have, your employees, might be affecting your results.

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Steve Booren

Steve Booren

Steve Booren is the Owner and Founder of Prosperion Financial Advisors, located in Greenwood Village, Colo. He is the author of Intelligent Investing: Your Guide to a Growing Retirement Income and a regular columnist in The Denver Post. He was recently named a Forbes Top Wealth Advisor in Colorado.

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Improving Investor Behavior: Blind Spots & Confirmation Bias

Person holding viewing glasses

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This article originally appeared in the Denver Post, July 19th, 2020.

We talk a lot about perspective in this article. Our perspective is the lens through which we view the world. It is our way of framing everything we see and ultimately defines how we react to what life throws at us. We believe what we believe because of our past experiences and perception of reality. In finance, investors often share their perspectives (albeit usually too much), which gives us untold insight into how people may be thinking at any given time.

The perspective du jour is that markets are not accurately pricing honest valuations (i.e., stocks are overpriced). But is this accurate or a blind spot in our perspective?

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Steve Booren

Steve Booren

Steve Booren is the Owner and Founder of Prosperion Financial Advisors, located in Greenwood Village, Colo. He is the author of Intelligent Investing: Your Guide to a Growing Retirement Income and a regular columnist in The Denver Post. He was recently named a Forbes Top Wealth Advisor in Colorado.

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Getting Back to Better

Friends enjoying a picnic in a New York park

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This article originally appeared in the Denver Post, June 21st, 2020.

As a dad, I’ve always embraced my inner Tim “The Tool Man” Taylor when it comes to Father’s Day. Whether it’s a new drill, pressure washer, or some other home improvement gadget, I’ve always enjoyed gifts that keep me building. In a way, I enjoy the metaphorical message behind it too: tools give me the ability to enhance the environment that keeps my family safe, warm, and protected. It’s what I’ve always strived to do as a father.  

My goal as a parent has always been to build a better future for my kids, and to give them opportunities that I didn’t have. Whether that’s financial, educational, personal, or whatever it may be. It’s an essential part of my “why.” I think deep down there’s a part of us that wants our kids to be better than we ever were. To me, that’s progress and hope. It’s an innate and immeasurable desire – to want our tomorrow to be better than our today.  

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Steve Booren

Steve Booren

Steve Booren is the Owner and Founder of Prosperion Financial Advisors, located in Greenwood Village, Colo. He is the author of Intelligent Investing: Your Guide to a Growing Retirement Income and a regular columnist in The Denver Post. He was recently named a Forbes Top Wealth Advisor in Colorado.

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Improving Investor Behavior: Fear is a Very Powerful Emotion

Elevator buttons

Note

This article originally appeared in the Denver Post, May 17th, 2020.

After almost 45 years as a financial advisor, one realizes that there’s truth behind the phrase, “Reality is made up of circles, but we see straight lines.” Market cycles, crises, and investor behavior are all echoes of things we’ve seen in the past and will likely experience again in the future. No doubt the COVID-19 crisis impacts us all, and while it may feel like something completely new, it really isn’t. This is especially true when focusing on finance.

You’ve likely heard the comparisons of this crisis to the Spanish Flu of 1918. While there are many parallels, this event was long ago. With so many innovations and improvements in the meantime, it’s hard to wrap your head around their similarities and differences. The “what-ifs” prevail. What if they had had better hospitals? What if they had better testing, doctors, technology?

So, for comparison’s sake, let’s consider more recent events. My career includes four large fear-driven market “crises” that come to mind: Black Monday in 1987, Y2K in 1999, the World Trade Center attacks in 2001, and the recession in 2008. Though these events are all unique, they were all the same in many ways.

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Steve Booren

Steve Booren

Steve Booren is the Owner and Founder of Prosperion Financial Advisors, located in Greenwood Village, Colo. He is the author of Intelligent Investing: Your Guide to a Growing Retirement Income and a regular columnist in The Denver Post. He was recently named a Forbes Top Wealth Advisor in Colorado.

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Highlights of the CARES Act

Capitol building

Late last week the senate passed and the President signed the CARES stimulus package designed to, among many things, curb the financial turmoil created in the wake of the Coronavirus. This $2.2 trillion, 800+ page legislation offers meaningful help to investors, business owners, and those directly impacted by layoffs or the virus.

Using several sources we’ve compiled a list of some of these benefits that our clients might find most helpful. If one stands out to you, please reach out to us and we’ll be happy to walk through how it might apply to your situation. We’d also recommend connecting with your CPA regarding tax-related items.

Here are some of the highlights:

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Fire Drills and Why We Do Them

Buttons to report a fire or call police

Every meeting we have with clients includes a line item on the agenda: Fire Drill. 

What would you do if the market dropped significantly tomorrow? What would that look like for you? For years now it has felt like an unnecessary discussion point, even with the occasional pull back due due to a tweet or tariff threat. Yet we keep it on the agenda because, in the words of Mike Tyson, “Everyone has a plan until they’re punched in the face.”

Two months ago, no one could have anticipated a worldwide pandemic resulting in a virtual halt of economic activity. Yet it happened. But isn’t that the purpose of fire drills? To know what the plan is if-and-when something disastrous happens?

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Steve Booren

Steve Booren

Steve Booren is the Owner and Founder of Prosperion Financial Advisors, located in Greenwood Village, Colo. He is the author of Intelligent Investing: Your Guide to a Growing Retirement Income and a regular columnist in The Denver Post. He was recently named a Forbes Top Wealth Advisor in Colorado.

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