6 Steps To Financial Empowerment For Business Owners

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The journey to financial empowerment as an entrepreneur is often challenging. Societal expectations, access to resources, and self-imposed limitations can create barriers to achieving financial success.

However, these obstacles are not insurmountable. By adopting specific strategies, you can break the cycle and build thriving, profitable businesses.

Here are key steps to help you on this path to financial empowerment

  1. Develop a Strong Money Mindset

One of the most critical steps to financial empowerment is developing a strong money mindset. Many people have been conditioned to view money with caution or even guilt, but it’s essential to shift this perspective. Cultivate a positive and abundant mindset around money by recognizing that making money is not only acceptable but necessary for sustaining and growing your business.

Invest in your financial education. Understanding the basics of money management, profit margins, and financial planning will give you the confidence to make informed decisions. Surround yourself with positive financial role models who can inspire and guide you.

The more you immerse yourself in an environment that values wealth creation, the more natural it will become to view money as a tool for success rather than a source of stress.

  1. Seek Out Funding Opportunities

Access to capital is often a significant barrier for entrepreneurs, but there are more resources available than ever before. Explore various funding sources, including angel investors, venture capital, small business grants, and even crowdfunding. Don’t be afraid to negotiate and advocate for your business and remember that you deserve the same opportunities as anyone else.

Networking plays a crucial role in accessing these opportunities. Join industry groups, attend events, and connect with other entrepreneurs and investors. Building relationships within these circles can open doors to funding and other resources that can help you scale your business.

  1. Build Confidence

Confidence is a cornerstone of financial empowerment. Entrepreneurs often struggle with self-doubt, which can hinder their ability to take risks, seize opportunities, and assert their worth. Building confidence requires intentional effort, but it’s well within your reach.

Start by setting and achieving small goals. Each success, no matter how minor, will boost your confidence and motivate you to take on larger challenges. Seek feedback from trusted peers or mentors and use it as a tool for growth rather than criticism. Celebrate your achievements, both big and small, to reinforce your sense of accomplishment.

  1. Prioritize Self-Care and Delegation

Balancing the demands of business ownership with personal responsibilities can be overwhelming. Many entrepreneurs feel the pressure to do it all, but this approach often leads to burnout and diminished productivity. Prioritizing self-care and delegation is crucial for long-term success.

Recognize the importance of work-life balance and set boundaries to protect your time and energy. Delegate tasks that don’t require your direct involvement. This allows you to focus on the strategic aspects of your business that drive growth and profitability. Remember, taking care of yourself is not a luxury; it’s a necessity for sustaining your business and achieving financial empowerment.

  1. Find a Mentor

Mentorship is invaluable in the journey to financial empowerment. A mentor who has achieved the success you aspire to can provide guidance, share insights, and help you avoid common pitfalls. Their experience and perspective can be a powerful tool for accelerating your business growth.

Reach out to successful entrepreneurs, industry leaders, or even peers who have expertise in areas where you seek improvement. Building a network of supportive mentors and peers creates a rich environment for learning, growth, and financial success.

  1. Value Your Work

One of the most common challenges for entrepreneurs is undervaluing their work. This often leads to underpricing products or services, which can hinder revenue growth and send the wrong message to potential clients. It’s essential to understand and assert the value of what you offer.

Conduct market research to ensure your pricing is competitive while reflecting the quality and uniqueness of your offerings. Don’t be afraid to charge what you’re worth. Clients who truly value your work will be willing to pay a fair price.

Remember, if you don’t value your work, others won’t either. Confidence in your pricing not only improves your bottom line but also reinforces your position as a serious and successful entrepreneur.

The bottom line is that breaking the cycle of financial struggle requires intentional action and a commitment to change. By following these tips, you can overcome the barriers that hold many people back in business. Financial empowerment is not just about making money; it’s about building a sustainable, profitable business that allows you to live the life you desire while making a positive impact on the world.

By Melissa Houston, Contributor

 

 

 

 

 

© 2024 Forbes Media LLC. All Rights Reserved

This Forbes article was legally licensed through AdvisorStream.

 

Prepared by Broadridge Advisor Solutions. © 2024 Broadridge Financial Services, Inc. 

Investment and insurance products and services are offered through Osaic Institutions, Inc., Member FINRA/SIPC. F&M Financial Services is a trade name of F&M Bank. Osaic Institutions and F&M Bank are not affiliated.

Securities and Insurance Products:

Not Guaranteed by the Bank | Not FDIC Insured | Not a Deposit | Not Insured by Any Federal Government Agency | May Lose Value Including Loss of Principal

 

 

F&M Bank and F&M Financial Services Announce the Promotion of Calan Jansen to Senior Vice President

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Timberville, VA (8/19/2024)

 

FOR IMMEDIATE RELEASE

F&M Bank is pleased to announce the promotion of Calan Jansen to the position of Senior Vice President. With over 20 years of wealth experience, Calan holds her Series 66, 63, SIE, 7, and 6 licenses, has been an invaluable asset to F&M Bank for the past 8 years, and is an Osaic Institutions Wealth Advisor with F&M Financial Services.

 

Throughout her career, Calan has consistently demonstrated excellence and has been recognized as one of the top 20 advisors nationally within Osaic Institutions, Inc. Her exceptional skills and expertise have also earned her the distinction of being the leading female advisor within the state of Virginia.

 

Calan is known for her personalized approach to financial planning, understanding that each individual has unique aspirations, circumstances, and risk tolerances. Her thoughtful and tailored strategies have set her apart in the industry, earning her the trust and confidence of her clients.

 

When asked about her promotion, Calan stated, “I am honored and excited to take on this new role as Senior Vice President at F&M Financial Services. I look forward to continuing to serve our clients with dedication and expertise, helping them achieve their financial goals and secure their future.”

 

F&M Bank CEO, Mike Wilkerson, expressed his confidence in Calan’s abilities, saying, “Calan has consistently demonstrated outstanding performance and exceptional leadership throughout her tenure at F&M Bank. Her promotion to Senior Vice President is well-deserved, and I have no doubt that she will excel in this expanded role, further contributing to the success of our organization.”

 

In addition to her professional achievements, Calan’s team recently achieved a significant milestone by winning the Gold award in the Shenandoah Valley Best contest. This community-voted contest, hosted annually by the Harrisonburg Radio Group, recognizes the excellence and dedication of local businesses within the Shenandoah Valley.*

 

For more information about F&M Financial Services and to get in touch with Calan Jansen, please visit www.fmbankva.com/calan-jansen.

 

* F&M Financial Services was awarded Gold in the 2024 Shenandoah Valley Best Contest’s Wealth Management category. The nomination and voting period occurred in March 2024, with results announced publicly in May 2024. Results can be viewed at www.shenandoahvalleybest.com/categories/2024

Investment and insurance products and services are offered through Osaic Institutions, Inc., Member FINRA/SIPC. F&M Financial Services is a trade name of F&M Bank. Osaic Institutions and F&M Bank are not affiliated.

Securities and Insurance Products:

Not Guaranteed by the Bank | Not FDIC Insured | Not a Deposit | Not Insured by Any Federal Government Agency | May Lose Value Including Loss of Principal

 

 

###

 

Contact:

Marketing@fmbankva.com

Jake Mowry, (540) 437-3466

About F&M Bank

F&M Bank Corp. (OTCQX: FMBM) proudly remains the only publicly traded organization based in Rockingham County, VA, and since 1908, has served the Shenandoah Valley through its banking subsidiary F&M Bank, with full-service branches and a wide variety of financial services, including home loans through F&M Mortgage, and real estate settlement services and title insurance through VSTitle. Both individuals and businesses find the organization’s local decision-making and up-to-date technology provide the kind of responsive, knowledgeable, and reliable service that only a progressive community bank can.

 

What expenses are included in the annual cost of college?

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To most parents, the annual cost of college simply refers to tuition and room and board. To the federal government, however, the annual cost of college means the cost of attendance. Twice per year, the federal government calculates the cost of attendance for each college, adjusts the figure for inflation, and, if your child is applying for financial aid, uses this number to determine your child’s financial need.

Five categories of expenses are used to determine the cost of attendance at a particular college:

  • Tuition and fees: Same for all students at private colleges but can vary at public colleges, depending on whether the student is in-state or out-of-state
  • Room and board: Can vary by student, depending on the meal plan your child selects and whether he or she lives on or off campus
  • Books and supplies: Can vary by student, depending on your child’s courses and his or her requirements
  • Transportation: Can vary greatly by student, depending on where your child lives in relation to the school
  • Personal expenses: Can vary by student (e.g., health insurance, spending money, clothing)

Tuition, fees, room, and board (referred to as “direct costs”) are calculated using the college’s figures. For books, supplies, transportation, and personal expenses (referred to as “indirect costs”), the federal government sets a monetary figure even though the exact expenses incurred will depend on the individual student. Thus, depending on these variables, your child’s actual cost may be slightly higher or lower than the cost used for official purposes like financial aid determinations.

If you’re interested in obtaining the monetary amount allotted to each category for a particular college, contact that college directly.

 

 

Prepared by Broadridge Advisor Solutions. © 2024 Broadridge Financial Services, Inc. 

Investment and insurance products and services are offered through Osaic Institutions, Inc., Member FINRA/SIPC. F&M Financial Services is a trade name of F&M Bank. Osaic Institutions and F&M Bank are not affiliated.

Securities and Insurance Products:

Not Guaranteed by the Bank | Not FDIC Insured | Not a Deposit | Not Insured by Any Federal Government Agency | May Lose Value Including Loss of Principal

Can Home Improvements Lower Your Tax Bill? It Depends

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Most home improvements are not tax deductible — with one possible exception. In certain situations, you may be able to deduct improvements deemed necessary for medical reasons (not just beneficial to general health). If you itemize instead of taking the standard deduction, you can deduct unreimbursed medical expenses that exceed 7.5% of your adjusted gross income, so the tax savings could be significant if a costly home improvement pushes your total medical expenses above that threshold. Installing air conditioning to help treat asthma or modifying a home to make it wheelchair accessible are common examples of qualifying expenses.

Here are two more ways that improving your home could potentially reduce your tax burden.

Capital improvements

Projects that add to the value of your home, prolong its life, or adapt it to new uses are considered capital improvements. When you sell your home in the future, you can add the cost of capital improvements to your initial basis (what you paid for it originally), reducing your capital gain and the resulting tax bill.

Some examples of capital improvements include remodeling the kitchen, replacing all your home’s windows, adding a bathroom, or installing a new roof. Repairs that keep your home in good condition (such as repainting, replacing a broken door or window, or fixing a leak) don’t count as capital improvements. However, an entire repair job may be considered an improvement if it’s done as part of an extensive remodel or restoration.

Energy-saving tax credits

The Inflation Reduction Act of 2022 reconfigured two nonrefundable tax credits for home improvements that save energy. Unlike a deduction, which reduces your taxable income, a tax credit lowers your tax bill dollar for dollar. Both credits are available only for the installation of new products that meet specific energy efficiency requirements.

The energy efficient home improvement credit is equal to 30% of qualified expenditures for an existing home (not new construction). A $3,200 maximum annual credit is available through 2032. A $2,000 limit (30% of all costs, including labor) applies to electric or natural gas heat pumps, heat pump water heaters, and biomass stoves and boilers. A separate $1,200 limit applies to home energy audits and building envelope components (such as exterior doors, windows, skylights, and insulation) and energy property (including central air conditioners).

The residential clean energy property credit is a 30% tax credit available for qualifying expenditures for clean energy property (and related labor costs) such as solar panels, solar water heaters, geothermal heat pumps, wind turbines, fuel cells, and battery storage.

Learn more about investment products and schedule a call with Calan today!

 

 

For retirees investing in bonds, don’t assume that individual bonds and bond funds are the same type of investment. Bond funds do not offer the two key characteristics offered by bonds: (1) income from bond funds is not fixed–dividends change depending on the bonds the funds has bought and sold as well as the prevailing interest rate, and (2) a bond fund does not have an obligation to return principal to you when bonds within the fund mature. Additionally, the risk associated with bond funds varies depending on the bonds held within the fund at any given time, whereas the risk associated with individual bonds generally decreases over time as a bond nears its maturity date (assuming the issuer’s financial situation doesn’t deteriorate). Finally, fees and charges associated with bond funds reduce returns. Even so, you may still find bond funds attractive because of their convenience. Just be sure you understand the differences between bond funds and individual bonds before you invest.

This content has been reviewed by FINRA.

Prepared by Broadridge Advisor Solutions. © 2024 Broadridge Financial Services, Inc. 

Investment and insurance products and services are offered through Osaic Institutions, Inc., Member FINRA/SIPC. F&M Financial Services is a trade name of F&M Bank. Osaic Institutions and F&M Bank are not affiliated.

Securities and Insurance Products:

Not Guaranteed by the Bank | Not FDIC Insured | Not a Deposit | Not Insured by Any Federal Government Agency | May Lose Value Including Loss of Principal

Investment Planning throughout Retirement

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Investment Planning throughout Retirement

Investment planning during retirement is not the same as investing for retirement and, in many ways, is more complicated.

Your working years are your saving years. With luck, your income increases from year to year as you receive promotions and/or pay raises; those increases offer some protection against rising costs caused by inflation. While you’re working, your retirement objective generally is to grow retirement savings as much as possible, and investments that offer higher potential reward in exchange for greater potential for volatility and/or loss are often the focus for those retirement savings.

When you retire, on the other hand, spending rather than saving becomes your focus. Your sources of income may include Social Security, employer pensions, personal savings and assets, and perhaps some income from working part-time. Typically, a retiree’s objective is to derive sufficient income to maintain a chosen lifestyle and to make assets last as long as necessary.

This can be a tricky balancing act. Uncertainty abounds — you don’t know how long you’ll live or whether rates of return will meet your expectations. If your income is fixed, inflation could erode its purchasing power over time, which may cause you to invade principal to meet day-to-day expenses. Or, your retirement plan may require that you make minimum withdrawals in excess of your needs, depleting your resources and triggering taxes unnecessarily. Further, your ability to tolerate risk is lessened — you have less time to recover from losses, and you may feel less secure about your finances in general.

How, then, should you manage your investments during retirement given the above complications? The answer is different for everyone. You should tailor your plans to your own unique circumstances, and you may want to consult a financial planning professional for advice.

The following discusses two important factors you should consider: (1) withdrawing income from retirement assets, and (2) balancing safety with growth.

Choosing a sustainable withdrawal rate

A key factor that determines whether your assets will last for your entire lifetime is the rate at which you withdraw funds. The more you withdraw, the greater the likelihood you’ll exhaust your resources too soon. On the other hand, if you withdraw too little, you may have to struggle to meet expenses; also, you could end up with assets in your estate, part of which may go to the government in taxes. It is vital that you estimate an appropriate withdrawal rate for your circumstances, and determine whether you should adjust your lifestyle and/or estate plan.

Your withdrawal rate is typically expressed as a percentage of your overall assets, even though withdrawals may represent earnings, principal, or some combination of the two. For example, if you have $700,000 in assets and decide a 4 percent withdrawal rate is appropriate, the portfolio would need to earn $28,000 a year if you intend to withdraw only earnings; alternatively, you might set it up to earn $14,000 in interest and take the remaining $14,000 from the principal. An appropriate and sustainable withdrawal rate depends on many factors including the value of your current assets, your expected rate of return, your life expectancy, your risk tolerance, whether you adjust for inflation, how much your expenses are expected to be, and whether you want some assets left over for your heirs.

Fortunately, you don’t have to make a wild guess. Studies have tackled this issue, resulting in the creation of tables and calculators that can provide you with a range of rates that have some probability of success. However, you’ll probably need some expert help to ensure that this important decision is made carefully.

Withdrawing first from taxable, tax-deferred, or tax-free accounts

Many retirees have assets in various types of accounts: taxable, tax-deferred (e.g., traditional IRAs), and tax-free (e.g., Roth IRAs). Given a choice, which type of account should you withdraw from first? It depends on your specific situation.

Roth IRA earnings are generally free from federal income tax if certain conditions are met, but may not be free from state income tax.

Retirees who will not have an estate

For retirees who do not intend to leave assets to beneficiaries, the answer is simple in theory: Withdraw money from a taxable account first, then a tax-deferred account, and lastly, a tax-free account. This will provide for the greatest growth potential due to the power of compounding.

In practice, however, your choices, to some extent, may be directed by tax rules. Retirement accounts, other than Roth IRAs, have minimum withdrawal requirements. In general, you must begin withdrawing from these accounts by April 1 of the year following the year you turn age 73. Failure to do so can result in a 25 percent excise tax imposed on the amount by which the required minimum distribution exceeds the distribution you actually take. (The tax is reduced to 10% if you take the full required amount and report the tax by the end of the second year after it was due and before the IRS demands payment.)

Retirees who will have an estate

For retirees who intend to leave assets to beneficiaries, the analysis is more complicated. You need to coordinate your retirement plan with your estate plan.

If you have appreciated or rapidly appreciating assets, it may be more advantageous for you to withdraw from tax-deferred and tax-free accounts first. This is because these accounts will not receive a step-up in basis at your death, as many of your other assets will, and your heirs could face a larger than necessary tax liability.

However, this may not always be the best strategy. For example, if you intend to leave your entire estate to your spouse, it may be better to withdraw from taxable accounts first. This is because spouses are given preferential tax treatment with regard to retirement plans. As a beneficiary of a traditional IRA or retirement plan, a surviving spouse can roll over retirement plan funds to his or her own IRA or retirement plan, or, in some cases, may continue the deceased spouse’s plan as his or her own. The funds in the plan continue to grow tax deferred, and distributions need not begin until the spouse’s own required beginning date.

Retirees in this situation should consult a qualified estate planning attorney who has some expertise with regard to retirement plan assets.

Balancing safety and growth

When you retire, you generally stop receiving income from wages, a salary, or other work-related activity and start relying on your assets for income. To ensure a consistent and reliable flow of income for your lifetime, you must provide some safety for your principal. This is why retirees typically shift at least a portion of their investment portfolio to more secure income-producing investments, and this makes a great deal of sense.

Unfortunately, safety comes with a price, which is reduced growth potential and erosion of value due to inflation. Safety at the expense of growth can be a critical mistake for some retirees. On the other hand, if you invest too heavily in growth investments, your risk is heightened, and you may be forced to sell during a downturn in the market should you need more income. Retirees must find a way to strike a reasonable balance between safety and growth.

One solution may be the “two bucket” approach. To implement this, you would determine your sustainable withdrawal rate (see above), and then reallocate a portion of your portfolio to fixed income investments (e.g., certificates of deposit and bonds) that will provide you with sufficient income for a predetermined number of years. You would then reallocate the balance of your portfolio to growth investments (e.g., stocks) that you can use to replenish that income “bucket” over time.

The fixed income portion of your portfolio should be able to provide you with enough income (together with any other income you may receive, such as Social Security and required minimum distributions from retirement plans) to meet your expenses so you won’t have to liquidate investments in the growth portion of your portfolio at a time when they may be down. This can help you ride out fluctuations in the market, and sell only when you think a sale is advantageous.

Be sure that your fixed income investments will provide you with income when you’ll need it. One way to accomplish this is by laddering. For example, if you’re investing in bonds, instead of investing the entire amount in one issue that matures on a certain date, spread your investment over several issues with staggered maturity dates (e.g., one year, two years, three years). As each bond matures, reinvest the principal to maintain the pattern.

As for the growth portion of your investment portfolio, common investing principles still apply:

  • Diversify your holdings
  • Invest on a tax-deferred or tax-free basis if possible
  • Monitor your portfolio and reallocate assets when appropriate

 

Learn more about our investment products and schedule a call with Calan today!

 

For retirees investing in bonds, don’t assume that individual bonds and bond funds are the same type of investment. Bond funds do not offer the two key characteristics offered by bonds: (1) income from bond funds is not fixed–dividends change depending on the bonds the funds has bought and sold as well as the prevailing interest rate, and (2) a bond fund does not have an obligation to return principal to you when bonds within the fund mature. Additionally, the risk associated with bond funds varies depending on the bonds held within the fund at any given time, whereas the risk associated with individual bonds generally decreases over time as a bond nears its maturity date (assuming the issuer’s financial situation doesn’t deteriorate). Finally, fees and charges associated with bond funds reduce returns. Even so, you may still find bond funds attractive because of their convenience. Just be sure you understand the differences between bond funds and individual bonds before you invest.

This content has been reviewed by FINRA.

Prepared by Broadridge Advisor Solutions. © 2024 Broadridge Financial Services, Inc.

Have You Met Calan Jansen, One of Virginia’s Leading Financial Advisors?

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When it comes to managing your wealth and planning for your financial future, having an experienced and knowledgeable advisor by your side is crucial. In the state of Virginia, one name stands out among the rest – Calan Jansen. With over 20 years of wealth experience and Series 66, 63, SIE, 7, and 6 licenses, Calan has established herself as one of the top financial advisors in the region.

Calan’s Background and Expertise

Raised in Shenandoah County, Calan’s roots are deeply embedded in the local community. Her career in finance has been driven by her passion for helping individuals achieve financial security and peace of mind. Calan’s extensive experience in wealth management has equipped her with a unique set of skills and insights, enabling her to navigate the complexities of the financial world with ease.

Impressive Achievements

For the last five years, Calan Jansen has consistently ranked among the top 20 advisors nationally within Osaic Institutions Inc. This exceptional accomplishment is a testament to her dedication, expertise, and unwavering commitment to her clients’ financial success. Furthermore, Calan is also proud to hold the distinction of being the leading female advisor in the state, breaking barriers and paving the way for other women in the industry.

Extensive Wealth Experience

With over 20 years of experience in the financial industry, Calan Jansen brings a wealth of knowledge and expertise to her clients. Throughout her career, she has honed her skills in various aspects of wealth management, including investment strategies, retirement planning, and risk management. Calan’s expertise extends to a wide range of financial instruments, ensuring that her clients receive tailored advice and guidance to meet their unique financial goals.

Thoughtful Approach

What truly sets Calan apart is her thoughtful approach to each client she works with. She understands that every individual has different financial aspirations, circumstances, and risk tolerances. Calan takes the time to listen and understand her clients’ needs, goals, and concerns, allowing her to develop personalized strategies that align with their long-term objectives. Her ability to build strong relationships based on trust and open communication has earned her a loyal client base who appreciate her genuine care and dedication.

 

Calan Jansen’s impressive track record, extensive wealth experience, and thoughtful approach make her the go-to financial advisor in the state of Virginia. Her commitment to her clients’ financial success, coupled with her expertise in wealth management, sets her apart from the rest. Whether you are planning for retirement, seeking investment opportunities, or looking to protect your assets, Calan Jansen is the trusted advisor who will guide you every step of the way.

 

Learn more about our investment products and schedule a call with Calan today!

 

Investment and insurance products and services are offered through Osaic Institutions, Inc., Member FINRA/SIPC. F&M Financial Services is a trade name of F&M Bank. Osaic Institutions and F&M Bank are not affiliated.

Securities and Insurance Products:

Not Guaranteed by the Bank | Not FDIC Insured | Not a Deposit | Not Insured by Any Federal Government Agency | May Lose Value Including Loss of Principal

 

 

Should You Buy Long-Term Care Insurance?

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The longer you live, the greater the chances you’ll need some form of long-term care. If you’re concerned about protecting your assets and maintaining your financial independence in your later years, long-term care insurance (LTCI) may be for you.

Who needs it?

As we age, the odds increase that we’ll need some form of long-term care at some point during our lives. And with life expectancies increasing at a steady rate, the likelihood of needing long-term care can be expected to grow in the years to come.

But won’t the government look out for me?

Medicare pays nothing for nursing home care unless you’ve first been in the hospital for 3 consecutive days. After that, it will pay only if you enter a certified nursing home within 30 days of your discharge from the hospital. For the first 20 days, Medicare pays 100 percent of your nursing home care costs. After that, you’ll pay $204.00 in 2024 per day for your care through day 100, and Medicare will pick up the balance. Beyond day 100 in a nursing home, you’re on your own–Medicare doesn’t pay anything.

If you’re at home, Medicare provides minimal short-term coverage for intermediate care (e.g., intravenous feeding or the treatment of dressings), but only if you’re confined to your home and the treatments are ordered by a doctor. Medicare provides nothing for custodial care, such as help with feeding, bathing, or preparing meals.

Medicaid covers long-term nursing home costs (including both intermediate and custodial care costs) but only for individuals who have low income and few assets (eligibility guidelines vary from state to state). You will have to use up most of your savings before you qualify for Medicaid, and aside from a small personal needs allowance, you will have to use all of your retirement income, including Social Security and pension payments, to pay for your care before Medicaid pays anything. And once you qualify for Medicaid, you’ll have little or no choice regarding where you receive care. Only facilities with Medicaid-approved beds can accept you, and your chances of staying in your own home are slimmer, because currently most states’ Medicaid programs only cover limited home health care services.

Looking out for yourself

If you want to retain your independence, protect your assets, and maintain your standard of living while at the same time guaranteeing your access to a range of long-term care options, you may want to purchase LTCI. This insurance might be right for you if you meet the following criteria:

  • You’re between the ages of 40 and 84
  • You have significant assets that you would want to preserve as an inheritance for others or gift to charity
  • You have an income from employment or investments in addition to Social Security
  • You can afford LTCI premiums (now and in the future) without changing your lifestyle

Once you purchase an LTCI policy, your premiums can go up over time, but the rates can only rise for an entire class of policyholders in your state (i.e., all policyholders who bought a particular policy series, or who were within certain age groups when they bought the policy). Any increase must be justified and approved by your state’s insurance division.

Several factors affect the cost of your long-term care policy. The most significant factors are your age, your health, the amount of benefit, and the benefit period. The younger and healthier you are when you buy LTCI, the less your premium rate will be each year. The greater your daily benefit (choices typically range from $50 to $350) and the longer the benefit period (generally 1 to 6 years, with some policies offering a lifetime benefit), the greater the premium.

 

Connect with an Osaic Institutions Financial Advisor today!

 

Prepared by Broadridge Advisor Solutions. © 2024 Broadridge Financial Services, Inc.

Investment and insurance products and services are offered through Osaic Institutions, Inc., Member FINRA/SIPC. F&M Financial Services is a trade name of F&M Bank. Osaic Institutions and F&M Bank are not affiliated.

Securities and Insurance Products:

Not Guaranteed by the Bank | Not FDIC Insured | Not a Deposit | Not Insured by Any Federal Government Agency | May Lose Value Including Loss of Principal

Incorporating Impact Investing Into Your Retirement Planning

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Are you interested in the responsible investing trend? Looking for a way to get a competitive return on your investment without compromising your values? Impact investing allows you to directly support environmental and social change. Keep reading to learn more about impact investing, how it compares to ESG investments, and whether or not it’s right for you.

Hands holding the world

What Is Impact Investing?

The concept of impact investing was introduced in 2007 by the Rockefeller Foundation and others. The goal is to marry financial return alongside a measurable social impact. This type of investing is growing rapidly, with estimates in 2022 reaching $1.164 trillion.

 

Impact investors put their money in funds that consist of businesses driving environmental and social change. This can be in both the emerging and developed markets. Impact investments typically support areas like sustainable agriculture, renewable energy, conservation, microfinance, housing, healthcare, and education.

Who Can Be An Impact Investor?

Impact investing can be pursued at both the individual and institutional levels. For example:

 

  • Fund Managers
  • Development finance institutions
  • Diversified financial institutions
  • Private foundations
  • Pension funds and insurance companies
  • Family Offices
  • Individual investors
  • NGOs
  • Religious institutions
  • Corporates

Money growing trees

How Does Impact Investing Differ From ESG Investing?

Some people use “ESG” and “impact investing” as interchangeable terms, but there are some important distinctions.

What is ESG Investing?

 

  • ESG stands for Environment, Social, and Governance.
  • ESG investors choose to invest in companies with a high ESG score because they want their investments to align with their values.
  • However, ESG-designated companies are not necessarily making a direct impact on environmental, social, or governance issues.
  • Instead, ESG investors are supporting companies that are committed to protecting the environment, doing good in the communities where they operate, and meeting high standards for management and corporate governance.

What is Impact Investing?

  • Impact investing means using your money to drive the changes you want to see in the world. Impact investors want to get a good return on their investment, but they also want to invest in businesses that are driving change.

Overall, you can think of the difference between impact and ESG investing as a question of how you want your investment funds to count. Do you want to support existing companies that operate in a way that matches your values? Or, do you want to help newer companies make a direct impact in the areas that you care about?

ESG is a framework that helps investors understand the choices an organization makes. Impact investing is a strategy that helps investors make a difference directly from their investments. Both ESG and impact investing seek a return on the investment.

One last distinction: While all impact investment funds are ESG-compliant, not all ESG funds are impact investments.

Four Tenets of Impact Investing

These four characteristics of impact investing define investors’ expectations for what impact investing means and what they can hope to get out of it.

  • Intentionality: Perhaps the primary characteristic of impact investing is the investor’s intention to make a positive social or environmental impact through their investment decisions.
  • Data-driven: Impact investing may have a lofty goal, but it should still be based on evidence and data, not instinct or hunches.
  • Performance-measured: Impact investment funds should measure the actual impact produced to ensure investors are getting the desired results.
  • Knowledge sharing: Impact investors should share their experiences, using a shared language, to help grow the industry and help others learn.

Trends In Impact Investing

Interested in becoming an impact investor? Here’s what to watch for in this space:

 

  • More focus on women-owned businesses
  • More focus on the climate crisis
  • Greater adoption of digital technologies to track and measure impact
  • Standardization in the industry to avoid “impact washing”
  • Collaboration between investors and NGOs
  • A shift from broad, diversified investments to more focused and singular themes
  • Partnership between Impact and EGS investments

Man investing smart

Is Impact Investing a Good Fit For You?

As with many other questions around money and investing, the answer here will depend on your personal situation, values, and long-term goals. There are a variety of impact investments to choose from, but you should always do your research first and ask questions. Be realistic about the return you can expect on your impact investment. All investments carry risk, so make sure your choice of investment matches your risk tolerance (high, medium, or low). Finally, remember that you can also volunteer your time or make charitable donations to your favorite causes if you decide not to pursue impact investing.

Talk to our Osaic Institutions Financial Advisors for personalized advice!

If you have questions about impact investing, want to know which investments will best support your goals, or just need help developing an investment plan, F&M Financial Services is here for you. Schedule an appointment with an Osaic Institutions Financial Advisor with F&M Financial Services at any of our locations today!

Investment and insurance products and services are offered through Osaic Institutions, Inc., Member FINRA/SIPC. F&M Financial Services is a trade name of F&M Bank. Osaic Institutions and F&M Bank are not affiliated.

Securities and Insurance Products:

Not Guaranteed by the Bank | Not FDIC Insured | Not a Deposit | Not Insured by Any Federal Government Agency | May Lose Value Including Loss of Principal

Six Keys to More Successful Investing

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A successful investor maximizes gain and minimizes loss. Though there can be no guarantee that any investment strategy will be successful, and all investing involves risk, including the possible loss of principal, here are six basic principles that may help you invest more successfully.

Long-term compounding can help your nest egg grow

It’s the “rolling snowball” effect. Put simply, compounding pays you earnings on your reinvested earnings. The longer you leave your money at work for you, the more exciting the numbers get. For example, imagine an investment of $10,000 at an annual rate of return of 8 percent. In 20 years, assuming no withdrawals, your $10,000 investment would grow to $46,610. In 25 years, it would grow to $68,485, a 47 percent gain over the 20-year figure. After 30 years, your account would total $100,627. (Of course, this is a hypothetical example that does not reflect the performance of any specific investment.)

This simple example also assumes that no taxes are paid along the way, so all money stays invested. That would be the case in a tax-deferred individual retirement account or qualified retirement plan. The compounded earnings of deferred tax dollars are the main reason experts recommend fully funding all tax-advantaged retirement accounts and plans available to you.

While you should review your portfolio on a regular basis, the point is that money left alone in an investment offers the potential of a significant return over time. With time on your side, you don’t have to go for investment “home runs” to be successful.

 

Endure short-term pain for long-term gain

Riding out market volatility sounds simple, doesn’t it? But what if you’ve invested $10,000 in the stock market and the price of the stock drops like a stone one day? On paper, you’ve lost a bundle, offsetting the value of compounding you’re trying to achieve. It’s tough to stand pat.

There’s no denying it — the financial marketplace can be volatile. Still, it’s important to remember two things. First, the longer you stay with a diversified portfolio of investments, the more likely you are to reduce your risk and improve your opportunities for gain. Though past performance doesn’t guarantee future results, the long-term direction of the stock market has historically been up. Take your time horizon into account when establishing your investment game plan. For assets you’ll use soon, you may not have the time to wait out the market and should consider investments designed to protect your principal. Conversely, think long-term for goals that are many years away.

Second, during any given period of market or economic turmoil, some asset categories and some individual investments historically have been less volatile than others. Bond price swings, for example, have generally been less dramatic than stock prices. Though diversification alone cannot guarantee a profit or ensure against the possibility of loss, you can minimize your risk somewhat by diversifying your holdings among various classes of assets, as well as different types of assets within each class.

 

Spread your wealth through asset allocation

Asset allocation is the process by which you spread your dollars over several categories of investments, usually referred to as asset classes. The three most common asset classes are stocks, bonds, and cash or cash alternatives such as money market funds. You’ll also see the term “asset classes” used to refer to subcategories, such as aggressive growth stocks, long-term growth stocks, international stocks, government bonds (U.S., state, and local), high-quality corporate bonds, low-quality corporate bonds, and tax-free municipal bonds. A basic asset allocation would likely include at least stocks, bonds (or mutual funds of stocks and bonds), and cash or cash alternatives.

There are two main reasons why asset allocation is important. First, the mix of asset classes you own is a large factor — some say the biggest factor by far — in determining your overall investment portfolio performance. In other words, the basic decision about how to divide your money between stocks, bonds, and cash can be more important than your subsequent choice of specific investments.

Second, by dividing your investment dollars among asset classes that do not respond to the same market forces in the same way at the same time, you can help minimize the effects of market volatility while maximizing your chances of return in the long term. Ideally, if your investments in one class are performing poorly, assets in another class may be doing better. Any gains in the latter can help offset the losses in the former and help minimize their overall impact on your portfolio.

 

Consider your time horizon in your investment choices

In choosing an asset allocation, you’ll need to consider how quickly you might need to convert an investment into cash without loss of principal (your initial investment). Generally speaking, the sooner you’ll need your money, the wiser it is to keep it in investments whose prices remain relatively stable. You want to avoid a situation, for example, where you need to use money quickly that is tied up in an investment whose price is currently down.

Therefore, your investment choices should take into account how soon you’re planning to use your money. If you’ll need the money within the next one to three years, you may want to consider keeping it in a money market fund or other cash alternative whose aim is to protect your initial investment. Your rate of return may be lower than that possible with more volatile investments such as stocks, but you’ll breathe easier knowing that the principal you invested is relatively safe and quickly available, without concern over market conditions on a given day. Conversely, if you have a long time horizon — for example, if you’re investing for a retirement that’s many years away — you may be able to invest a greater percentage of your assets in something that might have more dramatic price changes but that might also have greater potential for long-term growth.

Note: Before investing in a mutual fund, consider its investment objectives, risks, charges, and expenses, all of which are outlined in the prospectus, available from the fund. Consider the information carefully before investing. Remember that an investment in a money market fund is not insured or guaranteed by the Federal Deposit Insurance Corporate or any other government agency. Although the fund seeks to preserve the value of your investment at $1 per share, it is possible to lose money by investing in the fund.

 

Dollar cost averaging: investing consistently and often

Dollar cost averaging is a method of accumulating shares of an investment by purchasing a fixed dollar amount at regularly scheduled intervals over an extended time. When the price is high, your fixed-dollar investment buys less; when prices are low, the same dollar investment will buy more shares. A regular, fixed-dollar investment should result in a lower average price per share than you would get buying a fixed number of shares at each investment interval. A workplace savings plan, such as a 401(k) plan that deducts the same amount from each paycheck and invests it through the plan, is one of the most well-known examples of dollar cost averaging in action.

Remember that, just as with any investment strategy, dollar cost averaging can’t guarantee you a profit or protect you against a loss if the market is declining. To maximize the potential effects of dollar cost averaging, you should also assess your ability to keep investing even when the market is down.

An alternative to dollar cost averaging would be trying to “time the market,” to predict how the price of the shares will fluctuate in the months ahead so you can make your full investment at the absolute lowest point. However, market timing is generally unprofitable guesswork. The discipline of regular investing is a much more manageable strategy, and it has the added benefit of automating the process.

 

Buy and hold, don’t buy and forget

Unless you plan to rely on luck, your portfolio’s long-term success will depend on periodically reviewing it. Maybe economic conditions have changed the prospects for a particular investment or an entire asset class. Also, your circumstances change over time, and your asset allocation will need to reflect those changes. For example, as you get closer to retirement, you might decide to increase your allocation to less volatile investments, or those that can provide a steady stream of income.

Another reason for periodic portfolio review: your various investments will likely appreciate at different rates, which will alter your asset allocation without any action on your part. For example, if you initially decided on an 80 percent to 20 percent mix of stock investments to bond investments, you might find that after several years the total value of your portfolio has become divided 88 percent to 12 percent (conversely, if stocks haven’t done well, you might have a 70-30 ratio of stocks to bonds in this hypothetical example). You need to review your portfolio periodically to see if you need to return to your original allocation.

To rebalance your portfolio, you would buy more of the asset class that’s lower than desired, possibly using some of the proceeds of the asset class that is now larger than you intended. Or you could retain your existing allocation but shift future investments into an asset class that you want to build up over time. But if you don’t review your holdings periodically, you won’t know whether a change is needed. Many people choose a specific date each year to do an annual review.

 

Contact us today for an assessment.

 

Prepared by Broadridge Investor Communications Solutions, Inc.

Investment and insurance products and services are offered through Osaic Institutions, Inc., Member FINRA/SIPC. F&M Financial Services is a trade name of F&M Bank. Osaic Institutions and F&M Bank are not affiliated.

Securities and Insurance Products:

Not Guaranteed by the Bank | Not FDIC Insured | Not a Deposit | Not Insured by Any Federal Government Agency | May Lose Value Including Loss of Principal

 

Building a Diverse Investment Portfolio: A Guide for New Investors in the Shenandoah Valley

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Looking for investment help in the Shenandoah Valley?  You’ve come to the right place. At F&M Financial Services, we know that investing can feel intimidating when you’re not familiar with the various investment options and terminology. In this article, we’ll cover the basics of building a diversified investment portfolio. From defining common terms to explaining different approaches to investing, you’ll have a better understanding of your investment portfolio. Of course, if you have specific questions or need advice about your portfolio, contact one of our Osaic Institutions Financial Advisors in Harrisonburg, Rockingham County, and Shenandoah County.

Where can I monitor stock values?

Local investors in the Shenandoah Valley can find a real-time market report and see our 14 most popular stocks on the Local Market Dashboard page. Looking for local investing help? Consider investing in local publicly-owned businesses with roots in the Shenandoah Valley. The dashboard provides a bird’s eye view of current share prices on the most popular local stocks, as well as important national indicators such as the Dow Jones Industrial Average, S&P 500, and NASDAQ Composite.

How to diversify your investments

Generally, diversifying* your investment portfolio is a reasonable approach to realizing steady long-term growth of your finances. Understand your various investment options and how they could support your investment goals:

What is a stock?**

Individual stocks represent a share of ownership in a publicly-traded company. Investors can buy stocks ‘a la carte” in the hope that they will increase in value over time. For example, investors who purchased individual Apple stock in 1980 would have seen their bet pay off very well in the years since, if they held onto it.

However, not every bet pays off and it’s hard to know at the Initial Public Offering which companies will become wildly successful like Apple or Tesla, and which will flame out. That’s why many investors prefer to mitigate the risk of individual stock values by investing in index funds or ETFs.

For example, the Dow Jones is a stock market index tracking 30 of the largest blue-chip companies on the stock exchange. You could choose an ETF (Exchange-Traded Fund) that tracks the Dow Jones. ETFs provide broad market exposure to potentially give your portfolio more stability and less risk.

Similarly, the S&P 500 is a stock market index following 500 of the top publicly traded U.S. companies. You can invest in index funds and ETFs that track the S&P.

Lastly, the Nasdaq Composite Index features stocks that are exclusively listed on the Nasdaq stock exchange. It is more tech-heavy than the Dow or S&P and the total number of stocks in the Nasdaq can change often.

What is a bond?

A bond is a unit of corporate debt that can be traded as an asset. Bonds are considered less risky than stocks to invest in because bonds have a fixed interest rate. However, the trade-off for that stability is usually a lower rate of return. That’s why building a diversified portfolio means having both higher-risk/higher-rate-of-return assets like stocks as well as more reliable/lower-rate-of-return assets like bonds.

What is a Mutual Fund?***

Unlike index funds and ETFs, which are not actively managed and only follow stocks, a mutual fund is defined by the U.S. Securities and Exchange Commission as:

A mutual fund is a company that pools money from many investors and invests the money in securities such as stocks, bonds, and short-term debt. The combined holdings of the mutual fund are known as its portfolio. Investors buy shares in mutual funds. Each share represents an investor’s part ownership in the fund and the income it generates.

 

Because mutual funds already contain a diversified portfolio of stocks, bonds, and short-term debt, buying shares in a mutual fund can be an easy way to diversify your own portfolio.

When it comes to index funds and ETFs vs. mutual funds, one of the main differences is that the cost of management fees tends to be lower for ETFs on average when compared to Mutual Funds. Mutual funds are sold by prospectus only, which may be obtained from a financial professional and should be read carefully before investing. Investors should consider the risks, investment objectives, fees, expenses, and charges disclosed in the prospectus.

CDs, Savings Accounts, and Money Market Accounts

As you approach retirement age, you’ll want to keep a portion of your investment portfolio in a more liquid account where you can earn some interest while having access to the next year or two of cash for living expenses. F&M Bank offers Certificates of Deposit (CDs), Free and Premium Savings Accounts, and Money Market to meet your liquidity needs.       

Should I include Real Estate in My Investment Portfolio?

During your investment research, you may have heard of the 20% rule. If you are unfamiliar, the idea is that some investors find value in allocating at least 20% of your portfolio into investments that are outside of the stock market itself. It is popular for many investors to fill this 20% with real estate. This is not a hard and fast rule, however. Some investors may be more comfortable with a smaller or larger percentage of their funds being in real estate. Regardless, it can be a good idea to consider this as a piece of your overall investing strategy. Our financial advisors can help you understand what allocation would be the best fit for you. You also can learn more about F&M Bank’s mortgage lending options to get started with funding a real estate purchase.

Consider Your Risk Tolerance

We’ve covered the risk levels of various investment vehicles such as stocks, bonds, and mutual funds. But you also need to consider your personal tolerance for risk when deciding how much of your portfolio to allocate to different types of investments.

 

How much time do you have?

Generally, the younger you are the more aggressive you can afford to be with risk. A temporary setback can be overcome with time, while someone close to retirement will want to be more moderate or conservative. However, age isn’t the only factor to consider. Your comfort level with risk, long-term investment goals, and current income are also important.

 

As a general rule of thumb, a portfolio for each risk level would look like:

 

  • Aggressive: About 80% stocks and 20% bonds
  • Moderate: About 50% stocks and 50% bonds
  • Conservative: About 20% stocks and 80% bonds

 

Contact our financial advisors in the Shenandoah Valley to discuss your personal risk tolerance and how to diversify your portfolio accordingly.

Build your investment portfolio with a team you trust!

If you’re looking for Wealth Management services in Virginia, our financial planners guide you through your options for how to invest your money in VA to ensure you understand your investment portfolio and are comfortable with our strategy. Schedule an appointment with an Osaic Institutions Financial Advisor with F&M Financial Services at any of our locations today!

 

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*Diversification is a method of helping to manage risk. It does not assure a profit or the avoidance of loss.

**Past performance is not a guarantee of future results.

*** Mutual funds are sold by prospectus only, which may be obtained from a financial professional and should be read carefully before investing. Investors should consider the risks, investment objectives, fees, expenses, and charges disclosed in the prospectus. Investment objectives, fees, expenses, and charges disclosed in the prospectus.

 

Investment and insurance products and services are offered through Osaic Institutions, Inc., Member FINRA/SIPC. F&M Financial Services is a trade name of F&M Bank. Osaic Institutions and F&M Bank are not affiliated.

Securities and Insurance Products:

Not Guaranteed by the Bank | Not FDIC Insured | Not a Deposit | Not Insured by Any Federal Government Agency | May Lose Value Including Loss of Principal