We hear quite a bit about “fake news” these days. It’s a term that doesn’t have a reliable definition. But one thing is true: all the talk of “fake news” has made some people much more likely to question the information they receive. I think some healthy skepticism is prudent. It’s my hope that this skepticism leads to better understanding of the entire issue under discussion.
One example is economic news we routinely see in the media. Over the last few years, the U.S. savings rate has been reported to have been in decline since 2009. But in a recent review of the U.S. economy by the Bureau of Economic Analysis in the Department of Commerce, the U.S. savings rate was revised upward as shown in this chart.
The revised information does raise a question: If people were saving more, how did they spend enough to increase Gross Domestic Product steadily since 2010?
One answer is that incomes rose more than at first thought. The revised numbers show an average of 3.5 percent increase annually over the past five years, instead 3.1 percent.
Another answer is that profits for partnerships, individual-owned companies and other small businesses were much higher than originally estimated. Profits not spent by these firms are considered savings.
Getting good financial advice
So the economy is growing. Savings rates are up. But what does it mean for your family and your financial goals? Well, it’s hard to say. The answer depends a lot on your family’s specifics. Remember, much of the macroeconomic news is interesting, but does not necessarily speak to the most important issues for your personal financial goals.
That’s why it’s so important to be a thoughtful consumer of the news and information offered to you. And sometimes that includes getting the perspective of a trained professional who is your advocate in the quest to reach your financial goals.
I think a good advocate is always very important to your financial success. That’s why I am so pleased to be a financial planner who is always my client’s advocate – a fiduciary advisor. As a fiduciary for my clients, it’s my job to be skeptical and always look for the best solution to solve my client’s problems. I work hard to fulfill this commitment.
Real financial information
Long-time clients and friends will remember me saying that I consider much of financial “news” to be more about titillation and entertainment than it is about innovations and investor education. I have often called it “financial pornography,” since it does not relate to your real situation and will not help you reach your financial goals. It can, however, be distracting and exciting.
If you want to move forward toward your financial goals, I suggest you turn off the cable financial news and set a meeting with a CERTIFIED FINANCIAL PLANNER™ professional. If you meet with a planner who is always an advocate for the client– a fiduciary advisor – and only works for the client – a fee-only advisor – you can be confident that the financial advice you get is focused on your best interests and is a good fit for your complete situation.
CFP® professionals take a multi-faceted approach to your financial planning process that includes budgets, risk protection, retirement planning, investment management, taxes and estate planning. All these related aspects of your financial life are what really matter when it comes to reaching your goals.
A CFP® professional can help you create a financial plan that is driven by your goals and priorities and addresses all aspects of your financial life. With a big-picture approach, you will get a meaningful understanding of your goal progress. And you will get a personalized action plan for how to move forward.
Yes, I am a CFP® professional. I’m always a fiduciary and I only work on a fee basis. And yes, I’m still taking on a few great families to be part of my financial planning practice.
If this article has you thinking the news of the day and trying to understand how it should affect your personal financial choices, contact my office at rdunn@dunncreekadvisors.com.
I am always happy to meet with people who are working on their financial goals. Dunncreek Advisors does not provide legal or tax advice, nor is this article intended to do so.
Have I saved enough for retirement?
