Where Will Your Financial Path Lead?

DC Insights is a collection of resources for informing your family business decisions and building your family’s financial life. Discover crafted articles, curated content, impactful charts, and interesting data. The information platform complements the advisory services we offer at Dakota Coast Capital and better assists our clients in solving their financial challenges.
  • 0 3 Commentaries For Parents This Holiday Season

    • Family
    • by Dakota Coast Capital
    • 12-04-2019

      As we enter the holiday season, many of us are taking time for reflection and to express our gratitude toward family and friends. On a personal level, taking time to educate myself on how to improve as a parent is always a goal that is top of mind. Perusing my Feedly over the last couple weeks, I noted several family-focused articles that caught my attention. What’s more, I realized the applicability of the principles have much greater reach than within my own family. After all, at Dakota Coast Capital, the foundation of the business is family. Therefore, serving to impact clients’ lives is just a natural extension from how I connect with my own family. The following three articles all struck me with relevant principles that were worthy of sharing and what I am striving for everyday at DCC. Lead By Example “Do As a I Say, Not As I Do.” Have you ever uttered those words to your child? I certainly have. It may be some of the worst instruction that we can provide. If we are not leading by example, we should not be surprised if our kids sometime behave inappropriately. Can anybody relate to letting a bad word slip and hear that same word from your toddler two hours later? As parents, our children often emulate our every move. It’s critical that we present the behavior that we want to see out of them. As the author in this article points out, financial behaviors are no different. Our children need to learn to manage their finances just as much as they need to learn to tie their shoes or drive a car. AND, it’s most crucial that parents model financial behaviors with spending, saving, and investing habits to prepare their children for promising financial futures. - Kiplinger: 5 Timeless Financial Lessons Our Children Need Now by Craig Hawley Embrace Change… And Uncertainty As parents, our work-family balance is constantly evolving, though consistently a juggling act. Working parents need support and planning, including financially. The authors highlight the challenges of being a working parent and having to continually adjust to the moving target of being a good parent while at the same time growing a promising career. We all have to simply get comfortable with the uncertainty of it all and embrace the changes that are to come – while also building as much of a support network as we can. Simply put, we can all only do our best and have faith that things will work out. - Harvard Business Review: How Being a Working Parent Changes As Children Grow Up by Danna Greenberg and Jamie J. Ladge The Power of Story Family stories help kids shape their identities... even when it seems that they may not be listening. This article reminds us of the importance of the holiday season in sharing those noteworthy family anecdotes from the past. Often, it’s those personal stories that resonate most with those you love. Although most of us tend to forget the specifics, the facts and figures, often the feelings of connection that stories evoke remain palpable over the long run and can really help our children gain and retain some of life’s most important lessons. - Wall Street Journal: The Secret Benefits of Retelling Family Stories by Sue Shellenbarger Hopefully, you’ve found something in the highlighted articles above that can help you in your family relationships. I’m hoping to focus my own efforts as a parent on each of the broad themes that I took away from the writings. As it relates to Dakota Coast Capital, we will also strive to hold on to the key tenants, as well: Leading by Example. We invest your hard-earned money using the same investment philosophy, strategy, and process as we do to invest our own money. Now, of course, we customize your portfolio to your specific goals and circumstances, so the exact allocations may differ as a result. However, the overarching core tenants are extremely consistent. We believe wholeheartedly in our investment approach. Embracing Uncertainty. Investing is inherently risky. There are so many unknowns regarding financial markets that we have no choice but to embrace the uncertainty. Importantly though, risk and return are related. Risks and uncertainty are what allow for upside in investing – not just downside. That’s the good news. Said another way, without uncertainty, investing likely wouldn’t provide us with nearly as much opportunity. At DCC, we offer you the support and expertise you need to navigate the inevitable market turbulence that will come and help you can reach your financial goals. Connecting through Story. We want you to understand our entire process and strive to be as transparent as possible in our communications. We try to distill challenging investing or financial planning concepts down into bite-size pieces that you can internalize. Our goal is for you to understand the “Why” behind everything we do and leave every discussion feeling peace of mind. If you think that we could be helpful to your family, please feel free to reach out to Dakota Coast Capital. We are happy to offer complimentary initial consultations or 2nd opinions on your current financial situation.   Nothing contained in this article shall constitute an offer to sell or solicitation of an offer to buy any security. Material in this article is original or from published sources and every effort is made to verify its accuracy. However, we cannot fully guarantee the accuracy or timeliness of such information. Readers are cautioned to consult their own tax, legal, and investment professionals with regard to their specific situations.

  • 0 3 Family Scenarios When You Should Consider A Financial Planner

    • Family
    • by Dakota Coast Capital
    • 11-14-2019

      DIY Or Call The Professional? Regardless of the service area, we grapple with variations of this question all the time, whether it’s taking care of that nagging knee pain, fixing the dripping faucet, or doing your own taxes. A good first step is asking yourself three simple questions: - Do I have the baseline knowledge necessary to complete the job? - Do I have the time to devote to the task? - Do I have the desire to spend my time doing this? I like to think of myself as pretty handy around the house. I grew up on a farm. I know my way around a tool chest. But let’s be honest, I’m most definitely NOT in the same league as the folks that are working with those tools on a daily basis. However, even knowing this, I usually end up trying the DIY route and getting halfway through the sink repair, with parts strung all over the kitchen floor… and give up. Defeatedly, I call in the expert to fix my mess after squandering an entire Saturday afternoon. The plumber inevitably comes in and fixes the issue, with astonishing ease, in about 30 minutes. Needless to say, I’m learning to just call in the professional right away for any repairs that require more than a basic Google search. I'm also pleasantly surprised by how often the professionals go above and beyond, fixing something that I didn’t even know needed it – and doing so for a reasonable difference in price (often free). That’s additional value that I could not have delivered myself. Time and again, if I would have just taken the time upfront to do my research and appropriately assess the situation, I would have made the call right away. It’s rare that I have regretted a decision to make the call to the professional. In the case of wealth management, financial planning, or investment advice, I think it’s similar. A competent financial advisor can add significant value to your situation and allow you to claw back precious time in the day to spend with your family or work on your business. At Dakota Coast Capital, we find that there are three common family scenarios that are typically worth the time to do your research, reach out to a financial professional, and obtain an independent analysis: - The Family in Transition - The Family Business Owner - The Family Steward While far from an all-encompassing list, these folks can usually benefit most from the services that a competent, respectable comprehensive financial planner can provide.   The Family in Transition We’ve all been there. You “wake up” and have found yourself in a brand-new family (or career) situation. You are suddenly overwhelmed with the new reality of your – hopefully exciting – life development. Often, the financial aspects of your new circumstances are (rightfully) a secondary thought but prove to eventually initiate some undesirable anxiety. Having a new baby, getting married, moving to a new city, changing careers, retiring, dealing with the loss or disability of a loved one… they all bring their own unique financial challenges. For example, the joy of welcoming a new baby to the family also comes with a slew of new considerations, including: - Ensuring you have an emergency fund for the unexpected - Adjusting your spending budget for childcare, groceries, and medical costs - Updating your estate plan and insurance coverages in case of tragedy - Starting a plan to fund your child’s education These are just a few, among many, worthy aspirations for freshly minted parents to consider implementing after a new bundle of joy arrives. How do you determine where to start? As we recently stated in Fatherly: How to Manage Your Money After Kids, it’s critical to take a step back after an important life event and take inventory of your whole financial picture and then develop a plan that appropriately balances the resources that it takes to accomplish all of the goals and dreams that you have for your financial future. Having assistance from an objective third party who has experience helping folks who have encountered similar circumstances could help to ensure your reach those goals during these types of life changes.   The Family Business Owner The job never truly stops, as any small business owner can attest. However, that’s also part of the excitement of guiding the strategic direction of a business. Leading and developing your workforce, managing your cash flow, and evaluating your next business development opportunity all occupy your working hours (and often beyond). Your evenings and weekends are filled with reading articles from Harvard Business Review or your favorite trade/industry resource and internal brainstorming sessions at the local coffee shop. You are trying desperately to maintain a semblance of your personal life and spend as much quality time as possible with your family, seemingly never finding quite enough. You always have challenging questions on your mind: - How do we grow sensibly without compromising the foundation of the business? - Are we offering the appropriate employee benefit and retirement plan options? - How do I coordinate my company’s financials with my own personal financial situation? In short, the complex set of challenges that come with being a family business owner make taking time out of your busy schedule to review (or create) your personal financial plan with a trusted professional all the more important. Often, business owners have much of their net worth tied up in the thriving company, which may expose them to some disproportionate concentration risk. Your eggs may all be in one basket, as they say. A comprehensive financial planner can help you work through strategies to diversify your asset base, develop a plan to mitigate the personal risk exposure of your business venture, and with an eye toward the future, provide expertise on developing an eventual exit or succession plan to fund your retirement.   The Family Steward Your position of patriarch or matriarch of a successful family is often a financially complex undertaking. You may be overwhelmed with juggling all the different accounts, evaluating investment opportunities, or delicately handling differences in opinion among family members. You may just be ready to delegate some (or all) of those items to a trusted professional and free up your time for something better. While a comprehensive financial planner can be helpful in many situations, hiring one tends to be especially beneficial when you have complex issues or questions to navigate. Complicated issues like multi-generational and legacy planning, appropriately balancing the financial planning for your personal needs and your business venture(s), or efficiently structuring your retirement distributions so that your family’s nest egg leaves a legacy beyond your lifetime requires more in-depth professional insight. Coordination across professional disciplines for complex planning items is critical under these circumstances. Having multiple independent perspectives can make all the difference in ensuring the success of your family legacy. You’ll likely want to include at least a Certified Financial Planner™ professional, a CPA, and an attorney with estate planning expertise. (Questions to ask, red flags to look for, and ways to increase your chances of building a competent, cross-discipline advisory team will be a topic for another day.)   Can You Relate? As is the case with my plumber, a comprehensive financial planner can crucial guidance to situations like these and allow you to claw back precious time in the day to spend with your family or work on your business. However, selecting an advisor is a complex decision that requires thorough research and ultimately takes a leap of faith to trust someone with partnering in your financial life. Moreover, determining the actual value that a planner can provide often takes some time. It's not always as immediately apparent as a fixed sink. The long-term nature of many financial goals – such as saving appropriately and investing prudently – predicate this. That being said, a respectable, knowledgeable financial planner should be able to demonstrate their value to you in a tangible way before you make any ongoing commitment. If they don’t satisfy your expectations, walk away. Move on and interview another planner or continue with the DIY route until you find someone you trust who does meet your expectations. The most important thing is just taking the initiative to do the research into finding an advisor who is a good fit for your family’s specific circumstances in the first place. If you think that we could be helpful to your family, please feel free to reach out to Dakota Coast Capital. We are happy to offer complimentary initial consultations or 2nd opinions on your current financial situation.     Nothing contained in this article shall constitute an offer to sell or solicitation of an offer to buy any security. Material in this article is original or from published sources and every effort is made to verify its accuracy. However, we cannot fully guarantee the accuracy or timeliness of such information. Readers are cautioned to consult their own tax, legal, and investment professionals with regard to their specific situations.

  • 0 Why I Started Dakota Coast Capital – A Fiduciary, Fee-Only, Independent Advisory Firm

    • General
    • by Dakota Coast Capital
    • 11-05-2019

      As the inaugural post for DC Insights, this will take on a different, more personal flavor than most of the content to come. If that’s not your cup of tea, feel free to skip to the end for the all-business part of the post and return later for subsequent writings which will provide more direct information on financial planning, investing, and family business strategy. If you are interested in learning the story of what led me to open the doors of Dakota Coast Capital, please read on below. My Family Business Where I grew up in rural South Dakota, fall harvest is the most important time of year. Family farmers spend all year working their land and finally, during autumn, they can capitalize on their efforts as they harvest their crops. The urgency of the task hangs in the crisp morning air, while the smell of the freshly harvested grain signals the completion of the job. The sense of accomplishment (and relief) that comes with successfully finishing a growing season is unmatched, especially when you consider just what it takes to make it all happen. The leap of faith required to place complete trust in factors outside of your control – the weather and the grain markets – and believe things will work out over the long run? Remarkable. The adherence to the day-in and day-out discipline necessary to be successful? Remarkable. My family is a family of farmers. My father, my grandfather, my great uncle, my great-grandfather – all farmers. It’s in the blood, as they say… My family’s legacy. Now, my two-year-old son drives his motorized John Deere up and down the driveway for hours on end and proudly names each of his toy farm animals for his adoring, mesmerized six-month-old sister. She, herself, shows rivaling affection for “Old McDonald.” Needless to say, I would be beyond proud if either them decide to be a farmer someday, too. You may recall a Super Bowl Commercial from a few years ago. The truck ad overlays a speech by Paul Harvey, in which he vividly orates just how remarkable one must be to choose farming as a profession. A farmer must possess an unrelenting work ethic, resolve, tenderness, resilience, and tenacity… among many other qualities. A set of qualities which I have aspired since my earliest age. But as inspiring as the words have always been to me, the last line in the tribute often has left me feeling a bit unsettled: A farmer… “then replies, with smiling eyes, when his son says that he wants to spend his life ‘doing what dad does’” That… wasn’t me. I always had different dreams. The family legacy almost felt like a burden. Still, after college I was compelled by the generations of tradition and returned to the family farm to start fulfilling my duty. One problem. It didn’t stick. After a few years, I mustered up the courage to leave the farm and pursue a career focused on the capital markets, where my passion had always been. It was one of the toughest choices I have ever had to make – choosing to go against the grain of my heritage and not “do what dad does.” Even though I knew in my gut that it was the right choice, it didn’t stop the feeling that I was potentially falling short of generations of responsibility.   My Family… In Transition Little did I know at the time, unfortunate circumstances would bring me back around to the farm far sooner than I could have expected. Fast forward to late 2017, my wife and I have just barely started to get the hang of our new role as parents in Charlotte, NC – clear across the country from my family farm. Professionally, I was working in a job that I loved with one of the world’s leading asset managers. My wife had a robust, blossoming health research career and a postdoctoral position secured at a prominent university. We were in a really great place, personally and professionally. Then, we were crushed to learn that my father’s health was deteriorating rapidly, and he could no longer live alone, much less continue managing the farm’s business. (By this time, much of the day-to-day management had been entrusted to other operators, but coordinating the strategic efforts still required a good deal of attention.) After months of doctor visits and hundreds of questions, we would learn that he had developed a form of early onset dementia called frontotemporal dementia (FTD) – the most common dementia in people under 60 years old1. The cruelty that this disease inflicts on its victims is unparalleled, which perhaps is self-explanatory when you consider how it painstakingly begins removing a person’s identity at such an early age. For a glimpse into my dad’s reality, take a few minutes to watch this 60 Minutes special from CBS. So, with that newfound shock, we experienced the overwhelming realization that we were residing in a city without another family member within 500 miles, working in rewarding but also quite demanding careers, raising an infant, and worrying about a parent living 1000 miles away with an incurable, devastating health condition. We both knew what we had to do. We had to move. I needed to leave a job I never imagined I would leave. It took me weeks to process that reality and be able to even present the situation to my superiors. But… I eventually did. And, we packed up life as we knew it. We decided to make the greater Philadelphia area, my wife’s hometown, our home base while I spent most of 2018 in South Dakota navigating my father’s medical needs – and reconnecting with the operations of our family farm. With all the challenges that my father’s condition brought, having the opportunity to be more involved in my family business again was a silver lining in it all. My appreciation and energy for the farm had never been at a higher level. I’m finally back to fulfilling an obligation to the family legacy, albeit in a different and exciting way. At some point in this process of navigating our new circumstances, I came to the realization that this is what I wanted to do full-time. Not a full-time return to farming, but to advise other families in similar circumstances. Families with businesses who need advice on the multi-generational planning efforts that can smooth (or ideally eliminate) any business disruptions and to help the estimated 70% of family businesses that are not currently surviving past the 1st generation of owner(s)2. Families who need help navigating the financial stresses of a newfound personal transition in their lives, whether that may be a spouse/parent facing a debilitating disease, welcoming a new baby to the family, or deliberating an upcoming retirement to spend more time with the grandkids. These notions became the foundation for the mission of Dakota Coast Capital.   So, What Does This All Mean For You? Now in 2019, the Philly suburbs are our permanent home (with undivided fan loyalty to the Eagles and an ever-increasing appreciation for Wawa). I have spent the year transforming the initial vision of Dakota Coast Capital into a reality. Although I am continuing to guide the high-level, strategic direction of our family farm – and absolutely love staying connected with my family’s legacy – my professional focus from this point forward is on DCC and providing the vital, tailored financial services to families who have encountered similar circumstances as we have. DCC is not just your run-of-the-mill financial advisory firm. Although, many hallmarks of our offering – fee-only, fiduciary, independence, comprehensive financial planning, science-based investing, long-term discipline and holistic wealth management – are undoubtedly terms that you will hear elsewhere. At least I hope you hear them elsewhere, as I believe they are all critical components of maximizing your probability of financial success. The real value that DCC offers is not just in our capacity to deliver sound financial advice, however. The firm was formed for the very purpose of molding all those essential components into an offering specifically fit to the needs of families who own small businesses or who have encountered a significant life transition. We can relate to where you are coming from and offer an experienced, objective perspective. Alleviating the financial pressures to a family in transition or an enhancing the strategic planning of a family with a business enterprise is personal business for me, and thus, for the firm. At the end of the day, the mission of DCC is to help you spend more time doing what you love with those you love. We exist to help you achieve peace of mind with your finances, free you up to pursue your dreams, and ultimately, create or fulfill a family legacy. We know from experience how significant (and challenging) it can be to accomplish those feats successfully.     Nothing contained in this article shall constitute an offer to sell or solicitation of an offer to buy any security. Material in this article is original or from published sources and every effort is made to verify its accuracy. However, we cannot fully guarantee the accuracy or timeliness of such information. Readers are cautioned to consult their own tax, legal, and investment professionals with regard to their specific situations. 1https://www.theaftd.org 2https://hbr.org/2012/01/avoid-the-traps-that-can-destroy-family-businesses

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