Managing your financial life is not just about money.

FPA Annual Conference Recap

Last month Kirk and Justin attended the Financial Planning Association’s annual conference in Nashville.  The annual FPA conference is one of the country’s largest gatherings for financial professionals. It is a great opportunity to keep up with what is happening in our industry. Here are a few of our takeaways…

Market Outlook

No financial conference would be complete without multiple sessions on the economy. As you probably know by this point, we at McNamara Financial take all economic and market prognostications with a grain of salt. But we had to sit through a bunch of these things, so I might as well pass on what we learned. If I had to summarize I would say that most of the speakers believe that the economy is in relatively good shape.  No one was willing to project a recession in the near term. That’s good news. However, there was also an agreement that prices, especially here in the US, are on the high side. The market has been in an uninterrupted upward trend since 2009 and it most certainly won’t last forever. The average forecast was for another 12 to 24 months of an upward trend, with serious uncertainty after that. Take that for what it’s worth.

Costs Still Count

There was no session dedicated specifically to investment costs.  But if you looked at the sessions as a unit, the transition to lower-cost investments was a driver of much of what was being discussed. The rise of exchange-traded funds (ETFs) and strategies using exchange traded funds show no signs of stopping.  This should come as no surprise to our clients of course. McNamara Financial began transitioning to lower-cost, index and index-based strategies using ETFs about 10 years ago.  Good to know we made the right decision.

Reverse Mortgages Gaining Traction

From a financial planning perspective, the thing that stuck out most this year was the focus on reverse mortgages. Reverse mortgages have been around for quite a while, mostly with a bad reputation due to high costs and lack of education.  The government updated the regulations for the reverse mortgage market on October 2nd.  Most of the experts agreed that the changes will improve the market over the long term. In addition, the realities of our country’s retirement situation, with low savings rates and increasing life expectancy, are making reverse mortgages a necessity for more and more Americans. And is more of our family, friends, and neighbors enroll, the less stigma the product will have. Our take away from the sessions was certainly not that reverse mortgages are great for everyone. Like any tool, they are appropriate for some people, and not for others. Hopefully the recent changes will improve the product and make them more appropriate, and more acceptable, more people.

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