VESTED Fall 2019

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The Age of Learning

Andre Ward Whatever His Hands Find To Do PLUS Overseas Properties The Gravity-Defying World of Negative Interest Rates Listen Up! The Making of a Mentor

FALL 2019

At CAPTRUST, we believe we have a profound responsibility to share our success with those less fortunate than we are. One way we do that is through the activities of the CAPTRUST Community Foundation, our in-house, employee-run charitable foundation. Its mission is to enrich the lives of children in communities we serve. The foundation, a registered 501(c)(3) charity, was formally organized in 2007 to provide our employees with opportunities to participate as a group in community outreach efforts and to offer their time, passion, and financial support as a way to give back.

“Children are the living messages we send to a time we will not see. �

Neil Postman

We invite you to like the CAPTRUST Community Foundation on Facebook.

COMMUNITY FOUNDATION

capcommunityfoundation.org | toll free: 855.649.0943 4208 Six Forks Road, Suite 1700 | Raleigh, NC 27609

Volume 5, Issue 3 | Fall 2019 PUBLISHER

We recently held our first VESTED Symposium in Raleigh to share the people and ideas contained in our magazine with readers in a new way. Despite the passing remains of Hurricane Dorian, we had a great turnout, and attendees enjoyed the evening’s blend of social and educational content. Barb Hagerty, last summer’s Second Act cover story, delivered the event’s keynote talk, followed by our own Kevin Barry sharing his insights on how we can all become better investors.

This issue’s Second Act hero is Andre Ward, a former professional boxer and 2004 Olympic gold medalist, who chose to retire undefeated at age 33 in 2017. Today, Ward applies the same intensity he brought to the boxing ring to his post-career life that includes broadcasting, business ventures, and mentorships.

In this issue, we also feature a range of topics, including: • buying a retirement home outside the U.S.; • podcasts as a form of entertainment and source of learning; • why most retirees are failing to maximize their Social Security benefits;

J. Fielding Miller Chief Executive Officer EDITORS John Curry Editor-in-Chief

EDITORIAL ADVISORY BOARD

industry is responding to older Americans’ desires to reengage their passions for learning and some of the options available to them.

And the latest installment of Investment Strategy from CAPTRUST Chief Investment Officer Kevin Barry and Investment Strategist Sam Kirby explores the recent phenomenon of negative interest rates—what they are, what they mean, and how to think about them as an investor.

As always, we appreciate your article ideas, thoughts, and suggestions. Please keep them coming!

Jeremy Altfeder Financial Advisor

Mike Gray Senior Vice President, Financial Advisor

Hugh (Trae) Cole Financial Advisor

Land Hite Senior Vice President, Financial Advisor

Ellen Crowley Vice President, Financial Advisor

Greg Middleton Director, Advisor Group

Nick DeCenso Senior Manager, Wealth Strategy

Aaron J. Morris Vice President, Financial Advisor

Karen Denise Senior Director, Wealth Client Services

Teri Parker Vice President, Financial Advisor

Philip D’Unger Specialist, Wealth Solutions

Alysia Tacinelli Client Management Consultant

Justin Gartman Client Management Consultant

Kyle Tucker Senior Vice President, Financial Advisor

Tiffany Walker Senior Wealth Planner

ART DIRECTION AND MARKETING Lonzetta Allen Associate Art Director

John Curry Art Director

Harrison Brackett Jennifer Mastrapasqua Graphic Designer Distribution Manager

All the best, WITH THE ASSISTANCE OF

• cybersecurity for world travelers; and • mentoring to positively influence future generations.

This issue’s must-read feature, “The Age of Learning” by regular contributor Kim Painter, looks at how the education

Alysa Cronin Managing Editor

J. FIELDING MILLER CAPTRUST Chief Executive Officer

Azul Photography Raleigh, NC

Worth Higgins & Associates, Inc. Richmond, VA

Gabrielle Burke Pittsburgh, PA

Getty Images Seattle, WA

Justin Gartman Raleigh, NC

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CONTENT AND CONTRIBUTORS

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Gabrielle Burke

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KEVIN BARRY

JENNIFER BROOKLAND

JOHN CURRY

SAM KIRBY

Kevin Barry is CAPTRUST’s chief investment officer and leads the Consulting Research Group, the team responsible for investment manager due diligence, asset allocation, and discretionary investment management for the firm’s wealth management and institutional advisory clients.

Barry studied finance at La Salle University in Philadelphia and the University of London, where he received a Master of Science degree in financial management.

Jennifer Brookland is a writer, editor, and radio producer living in Durham, North Carolina. She spent three years working in communications for international development organizations before moving to North Carolina. As a freelance journalist, Brookland writes and edits for a variety of local and international print and digital media, including the World Bank Group, the United Nations High Commissioner for Refugees, Our State magazine, and North Carolina Public Radio.

As chief marketing officer, John Curry is responsible for all areas of strategic marketing and branding for CAPTRUST. In the industry since 1986, Curry has served in senior management roles with firms such as ProShares and AllianceBernstein and has experience in areas of strategic marketing, including product development and design, market research, branding, and sales campaign management.

As leader of CAPTRUST’s Investment Strategist team, Kirby works with the firm’s financial advisors to assist clients with investment strategy, portfolio construction, and monitoring. He has 15 years of financial services experience. Kirby earned a Bachelor of Arts degree in journalism from the University of North Carolina and a Master of Science degree in management from North Carolina State University. He is a CFA charterholder.

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Features

Columns

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THE AGE OF LEARNING

16

PASSION PURSUITS

33

MONEY MINDSET

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WHATEVER HIS HANDS FIND TO DO

23

GLEANINGS

36

LASTING LEGACY

24

EXPERT ANGLE

39

CLIENT CONVERSATIONS

32

MARKET REWIND

42

CAPTRUST HAPPENINGS

by Kim Painter

by Jennifer Brookland

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OVERSEAS PROPERTIES

by Kim Painter

THE GRAVITY-DEFYING WORLD OF NEGATIVE INTEREST RATES

Listen Up!

by Jeanne Lee

Places & Prices

Safe Travels

by Jeanne Lee

The Fuzzy Math of Social Security

by John Curry

The Making of a Mentor

by Jane Leibbrand

by Kevin Barry and Sam Kirby

JEANNE LEE

JANE LEIBBRAND

KIM PAINTER

Jeanne Lee is a freelance writer living in the lovely college town of Oberlin, Ohio. She has written about consumer and business topics for 20 years, including stints at Fortune and Money. Her work has appeared in publications like USA TODAY, Fortune Small Business, and Health. She loves thinking about ways for people to hack their finances and daydreams of paying off her mortgage before she has to pay for college for her two boys.

Jane Leibbrand served 21 years as vice president of communications with the Council for the Accreditation of Educator Preparation. Author of numerous magazine and journal articles, she began her career as a high school English teacher and college English instructor. After receiving her Master of Arts degree from the University of Georgia, she transitioned to a career in communications in the Washington, D.C., area.

Kim Painter is a freelance writer specializing in health and lifestyle issues. She was a USA TODAY staffer for many years and has continued to contribute to the newspaper as a reporter, columnist, and blogger. She lives in McLean, Virginia, where she practices what she preaches: wearing sunscreen, eating broccoli, and getting at least 10,000 steps a day.

All publication rights reserved. None of the material in this publication may be reproduced in any form without the express written permission of CAPTRUST: 919.870.6822. Š2019 CAPTRUST Financial Advisors. The opinions expressed in this report are subject to change without notice. This material has been prepared or is distributed solely for informational purposes and is not a solicitation or an offer to buy any security or instrument or to participate in any trading strategy. CAPTRUST does not render legal, accounting, or tax advice. If you require such advice, you should contact the appropriate legal, accounting, or tax advisor. The information and statistics in this report are from sources believed to be reliable but are not warranted by CAPTRUST Financial Advisors to be accurate or complete.

Performance data depicts historical performance and is not meant to predict future results.

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The Age of

Learning

by Kim Painter

When Kate Fulkerson, 71, signed up for an online marketing course last year, she wondered if she might be the oldest student in the class.

But when Fulkerson, a clinical psychologist and career counselor based in Durham, North Carolina, showed up in Phoenix for a conference linked to the course, she saw that the number of gray-haired people outnumbered the younger ones.

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Fulkerson says her fellow attendees were much like the older adults she regularly counsels on encore careers. “These were very energized people trying to figure out what to do next with their lives.”

There are a lot of gray heads in online and brick-and-mortar classrooms these days, and a lot of adults over the age of 50 are asking the same question: What’s next?

Some are seeking new career skills. Many others are pursuing learning for learning’s sake—for intellectual stimulation, a sense of purpose, and, often, social connection.

And educators are responding by throwing out the welcome mat for mature learners in a bigger way than ever before. There are courses online, including the massive open online courses (MOOCs) that some major universities now offer to anyone with an internet connection. There are also plenty of traditional classrooms in colleges, universities, community centers, and elsewhere that welcome older learners.

Want to get a master’s or doctoral degree decades after you last set foot on a campus? Some universities now have support services just for you. Maybe you want to study the history or literature you missed as an undergrad focused on other things. You can find a no-pressure class for that. Or maybe you want to polish your tech skills, prepare for a new leadership role, or unleash your inner entrepreneur. Opportunities abound—in everything from oncampus fellowships to online micro-credential courses.

Still, “We have so much mind-shifting to do,” says Nancy MorrowHowell, a professor of social policy who directs the Harvey A. Friedman Center for Aging at Washington University in St. Louis.

“When we created all our educational institutions, life expectancy was half as long. Now that we live much longer, we can’t stop our formal education at age 22.”

While not all later learning is career-focused, economic forces are driving the change. “We want to work longer, and the workforce needs us longer,” says Morrow-Howell. “But the shift to multigenerational learning is just getting started.”

Want to get a master’s or doctoral degree decades after you last set foot on a campus? Some universities now have support services just for you.

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University for Life At age 57, Lynne Johnson, of Dallas, Texas, is a proud recent graduate of Washington University’s master’s degree program in social work. She hopes her degree will help her find a job with an organization that assists older adults and their caregivers.

She started her graduate studies at the university’s Brown School in 2015, a couple years after completing a long-delayed bachelor’s degree at another university. In between degrees, she was the primary caregiver for her mother, who has since passed away.

Previously, she had a long career in film production and a shorter stint as an English teacher in Taiwan.

Despite her many life experiences and her clear career goals, Johnson says she did not feel entirely welcome when she showed up at graduate school in her early 50s. “I could tell early on—even in the orientation—that the younger students didn’t want anything to do with the older students,” she says. “It was very awkward, and I had a hard time making friends and fitting in.” Some faculty members were unwelcoming as well, she says.

Eventually, she gained confidence and felt more at home, Johnson says. But she saw a need for more support for students like herself. In fall of 2018, shortly after her graduation, she worked with MorrowHowell to launch a group for students entering the Brown School at age 30 and over. The student group is part of a support program called Next Move.

The university, like many others, is taking broader steps to nurture learners of all ages. In late 2018, it joined the Age-Friendly University Global Network, a group that includes more than 50 universities in the U.S., Canada, Europe, and Asia.

The network is focused, Morrow-Howell says, on helping universities figure out ways to serve people of all ages and promote multigenerational connections.

“Older and younger students will figure out that they are all just people,” she says. “That could go a long way toward reducing ageism—by the young and old, toward the young and old, in workplaces and elsewhere.”

It’s no coincidence that universities are making these changes as alumni and other older adults, including retirees who move to university towns, are asking for more ways to partake in university life, says Holden Thorp, a former Washington University professor of chemistry and medicine, who was the university’s provost and executive vice chancellor for academic affairs for four years. Thorp is now editor-in-chief of the Science family of journals.

“We are definitely seeing some folks wanting to put together their encore careers, but we also are seeing folks who realize that maybe they could have gotten more out of college the first go-around, and 6

Fall | 2019

“

We are definitely seeing some folks wanting to put together their encore careers, but we also are seeing folks who realize that maybe they could have gotten more out of college the first go-around, and they are coming back to do some of the things they wish they had done.

Holden Thorp

”

they are coming back to do some of the things they wish they had done,” he says.

Traditional college students in their teens and early 20s “do not always think about how rich the intellectual experience in front of them can be,” says Thorp. “But if we can plant the seeds and they come back 30 years later, we’ve done our job.”

Learning for Learning’s Sake While career and degree-granting programs are welcoming more older learners, some of the most popular courses for mature adults remain those that offer learning for learning’s sake—with no grades or other expectations attached.

That’s the niche served by the Osher Lifelong Learning Institutes, a network of 124 programs hosted by colleges and universities serving 390 towns and cities in all 50 states, says Steve Thaxton, executive director of Osher’s national resource center at Northwestern University, Chicago. He notes that several hundred additional lifelong learning programs, unaffiliated with Osher, operate in other communities. A comprehensive list can be found at osher.net.

While each institute chooses its own offerings, the most popular courses nationwide fall into a few consistent categories year after year, Thaxton says. The list includes history, fine and creative arts, current affairs, literature, religion, philosophy, spirituality, and health and wellness.

The institutes, launched in 2001, “have grown and grown,” Thaxton says. They now serve about 200,000 members nationwide.

One of the largest programs is at Duke University in Durham, North Carolina. The greatest challenge for the program is finding enough classroom space, across four counties, for all the courses attended by its 2,600 members, says Institute Director Chris McLeod. For some popular classes, “we practically have to shoo people out of the classroom, because if we don’t, there will be gridlock in the parking lot” when students arrive for the next session, she says.

While career and degree-granting programs are welcoming more older learners, some of the most popular courses for mature adults remain those that offer learning for learning’s sake— with no grades or other expectations attached.

McLeod is seeking a new central classroom facility. At the same time, her institute and others like it are weighing the pros and cons of online access to some classes. Such access could expand participation but could also limit the social opportunities that are an important part of the experience, McLeod says. A happy medium might be to set up satellite classrooms—at assisted living centers, for example—where rooms full of people could interact with one another and with an instructor and students in another locale.

In a world where many people want to keep learning longer than they can keep driving, those kinds of accommodations make sense, Thaxton says.

McLeod says there’s also a demand for “more classes around rethinking and reimagining retirement because of longer life spans.” In fact, one of those classes was taught this fall by

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Fulkerson, the psychologist and career counselor studying online marketing to expand her own options.

According to Fulkerson, “there is a huge unmet need” for helping people past traditional retirement age realize and achieve their full potential. That’s why lifelong learning, for credit or not, for credentials or not, is a growth industry.

McLeod agrees. Her members, she says, are “some of the most energetic, highly educated people I’ve met in my life, and they are saying, ‘I’m not done.’”

According to Fulkerson, “there is a huge unmet need” for helping people past traditional retirement age realize and achieve their full potential. That’s why lifelong learning, for credit or not, for credentials or not, is a growth industry.

THE ENCORE FELLOWSHIP The idea of an encore career can sound like a fantasy: At midlife or beyond, you will do something totally new—ideally something that will give you a new sense of purpose and maybe even a paycheck.

So, how do you turn that fantasy into reality? For some people, the answer is an intense educational reboot at an encore career institute. These programs remain few and far between—and some are quite small, selective, and expensive—but more are popping up all the time. Many of the programs are yearlong fellowships at major universities.

This is how some of the best-known programs describe themselves: • The Stanford Distinguished Careers Institute offers people in midlife with major career accomplishments the opportunity to renew their purpose, develop new communities and recalibrate wellness, and transform themselves for new roles with social impact.

• The Advanced Leadership Initiative at Harvard University is a new third stage in higher education designed to prepare experienced leaders to take on new challenges in the social sector, where they can potentially make an even greater societal impact than they did during their careers.

• University of Minnesota Advanced Careers (UMAC) is a gap year for grown-ups as they transition from career jobs into what’s next. UMAC offers the time, space, and insights for fellows to reimagine the arc of their lives, which may include a new career, part-time work, entrepreneurship, or unpaid community participation.

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• The Inspired Leadership Initiative (ILI) at the University of Notre Dame is a program for individuals from all disciplines—business, nonprofit, and academic, just to name a few—who have completed their chosen careers and wish to spend an academic year at Notre Dame experiencing intellectual immersion, local and global community engagement, and many of the rich resources the university has to offer to pivot to the next stage in their lives.

• The TOWER Fellows Program at The University of Texas at Austin is an innovative initiative that provides individuals an opportunity to be at one of our nation’s outstanding research universities for nine months to enhance their knowledge by participating in intellectually stimulating classes and seminars, interact and engage with a community of peers, and prepare themselves for future opportunities.

Whatever His Hands Find To Do

by Jennifer Brookland

Boxer Andre Ward lay on his bedroom floor, his muscular legs propped up against the wall, trying to keep the thoughts that were tumbling through his mind from spilling out of his mouth. His wife, Tiffiney, was in her closet, just out of reach but within earshot. And he had never admitted the things to her that he was struggling to keep inside now.

“Don’t talk like this; don’t admit this,” Ward cautioned himself.

“Don’t say the ‘R’ word.”

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Retirement had not been the plan. Ward was at the top of his game. In fact, he was a day away from publicly announcing a three-fight deal with HBO—a cherry on top of an unbelievable mound of victories.

But he felt overwhelmed and burdened. Maybe it was time to stop.

Tears began rolling down his cheeks as he let the words come out.

He thought it was time to end the boxing career that had consumed and propelled him for 23 years.

Ward wasn’t accustomed to crying. He was used to winning. In the 13 years he’d been a professional boxer, he had never lost a single match.

A Look Back Ward grew up in the Bay Area of California, where his first love was baseball. But when his dad started telling him stories about his own amateur heavyweight career, it was game over. Ward wanted to be like his dad—a fighter.

There was plenty about Frank Ward not to emulate. He was a functional heroin addict: an engaged and well-meaning business owner and father, but one who couldn’t slip or weave out of addiction, emerging blank and distant from his room. Ward wondered how the man he regarded as Superman could transform so entirely.

Ward’s mother had already succumbed to her illness. She was a full-blown addict who lived on the streets for the better part of Ward’s youth.

Nevertheless, Ward never saw himself as a victim. “I had real hardships around me, but I didn’t grow up in the slums; I wasn’t a kid who had absolutely nothing,” Ward says. “I had a good family base even though my family had issues.”

As a single dad, Frank Ward was a no-nonsense guy and the most important man in his young son’s life. He took the 9-year-old Ward to Virgil Hunter, the man who would become his coach and godfather, and asked a question: “Can you teach my son how to hit and not get hit?”

Hunter could, and he did.

Becoming the Best Though Ward couldn’t have articulated it at the time, boxing was an escape. It didn’t matter that his dad was back in rehab or that they really were losing the house this time. In the ring, as his body ached with effort and his ears rang, and his opponent’s sweat rained down around him, he felt a sense of total peace.

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Though Ward couldn’t have articulated it at the time, boxing was an escape. It didn’t matter that his dad was back in rehab or that they really were losing the house this time. In the ring, as his body ached with effort and his ears rang, and his opponent’s sweat rained down around him, he felt a sense of total peace.

Getty Images: Al Tielemans

Ward used to wait for her to keep her promise to come home, watching out of his window. Sometimes, she would come back. But it was mostly to demand drug money from Frank Ward, not to see her son.

Ward fought his first amateur boxing match when he was just 10 years old. He put everything he had and everything he was into the sport. And it showed. He went 115 and 5 in his amateur career and won a gold medal for the U.S. as a light heavyweight at the 2004 Olympics in Athens before turning professional at age 20.

Ward took on the fighting nickname S.O.G., short for “Son of God,” a reflection of his deep Christian faith and spirituality.

From there, Ward’s career was even more illustrious. He earned multiple world titles in middle and heavyweight classes and became known as the No. 1 pound-for-pound fighter in the world. He fought 32 matches. He never lost.

There were plenty of examples of kids who came from rough backgrounds to dominate boxing: Mike Tyson, Kassim Ouma, Dwight Muhammad Qawi. But from a young age, Ward noticed something about sports stars who managed to fight their way up to the top. They often plummeted swiftly back down to earth when the game was up.

“

A lot of fighters come from nothing, get a lot of notoriety, prestige, money, and then it ends badly. I knew I didn’t want to be a fighter that people could wag their finger and shake their head at and say, ‘Look what he once was.'

Andre Ward

”

“A lot of fighters come from nothing, get a lot of notoriety, prestige, money, and then it ends badly,” Ward says. “I knew I didn’t want to be a fighter that people could wag their finger and shake their head at and say, ‘Look what he once was.’”

Perhaps because of that awareness—that boxing would be something he did, not all that he was—Ward always had the end in mind. “I never tried to convince myself it was forever,” he says.

Getty Images: Alexis Cuarezma

Ward promised himself that one day, when he decided to leave the sport, it would be at the apex of his career, when people would wonder why he was leaving, not cluck that he should have bowed out sooner.

In his penultimate fight, against light heavyweight champion Sergey Kovalev, Ward won a narrow victory. He spent the next three months doing nothing. He couldn’t convince himself to keep training. His desire was depleted. It felt like the end. His wife and his pastor, former Oakland Raiders running back Napoleon Kaufman, convinced him to put in one final effort.

A rematch against Kovalev that would cement Ward’s legacy as one of the greatest fighters in the world.

Walking into the Las Vegas ring that June day in 2017, Ward felt the familiar fear wash over him. He had to go out in front of the world shirtless in a pair of trunks and fight another man. His mind skipped to the Sunday after the fight—the downcast faces of his disappointed family, the commentators blathering about Ward’s big loss, the headlines his critics would finally get to write: Ward Defeated!

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He thought about the last time he had lost a fight, when he was around 14 years old. About the freezing Southwest flight home where he sat, shivering with his arms tucked into his jacket, feeling the loss as a cold, bottomless mix of anger, shame, and sadness. He’d never forgotten that feeling. And he never wanted to feel it again.

He didn’t have to. Even in the midst of that fight’s chaos, Ward felt ready. He felt peaceful. Ward beat Kovalev by technical knockout in the eighth round, holding on to his hard-won titles and clinching his fighting legacy. He was still on top.

So, three months later, when he dropped the ‘R’ word as Tiffiney rummaged in their San Ramon, California, closet, he felt an unburdening. It was time.

Mission Accomplished “As I walk away from the sport of boxing today, I leave at the top of your glorious mountain, which was always my vision and my dream,” Ward wrote in a web post entitled “Mission Accomplished.”

Now, it was time to avoid the fall.

Ward threw himself into his second act with all the ferocity and discipline he’d brought to the ring. The same intensity he brought to preparing for fights, training, his diet—now he brings it to what he calls his “post-career life,” a slew of broadcasting, business ventures, meetings, and mentorships.

“There’s a scripture that says whatever your hands find to do, do with all your might,” Ward says. “That’s what I’m trying to do, stay in attack mode.”

Ward is perhaps most prominently engaged as a broadcaster for ESPN. He’d moonlighted sporadically in a similar role for Showtime and HBO before his retirement. But last year, he became part of a three-man commentator team that regularly covers the sports network’s biggest boxing events.

For this self-described perfectionist, the fear of making a mistake in front of thousands of television viewers never goes away. But overcoming fear is what Ward is trained to do. Now, instead of psyching himself up for a fight, he talks himself down. Instead of taking a deep breath and never letting it go, when the little red “on air” light comes on and a producer starts the countdown, Ward tells himself to drop his shoulders and exhale.

Retiring from the ring has allowed Ward to dabble in other arenas, including acting, with a role in Creed 2 and a gig hosting a reality boxing show created in part by Sylvester Stallone. He is on the board of advisors of a company called Everybody Fights, a boutique gym hybrid launched by George Foreman III that offers a boxinginspired group fitness brand and an inclusive, empowering ethos.

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“

As I walk away from the sport of boxing today, I leave at the top of your glorious mountain, which was always my vision and my dream.

”

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be the best, Ward was sick of the routine: school, homework, gym, back home, rinse, and repeat. There was no hanging out, no lazing around, no daydreaming. “I gave up a childhood to get that gold medal, to get those championships,” he says. “So, I went out there and did everything I didn’t get a chance to do.”

Ward calls it his season of rebellion. “I really almost lost it all,” he says.

It was Hunter, his coach and godfather, who saw through Ward when he said he didn’t care about boxing anymore. He convinced him not to let the Olympics pass him by. And Ward felt the influence of God drawing him and pulling on him—leading him to be the champion he was supposed to be. The champion he became.

Stopping to Smell the Roses

Ward also runs his own clothing line, S.O.G. Sportswear. And he talks about his work as co-manager for Shakur Stevenson, a 22-year-old boxer from Newark who Ward says has been “an honor and a privilege” to help coach.

He also teamed up with Ike’s Love and Sandwiches Chief Executive Officer Ike Shehadeh to open a franchise location of the restaurant in Ward’s hometown of Hayward, California. (The Andre ‘S.O.G’ Ward sandwich is a hefty salami and provolone affair with a one-two punch of pesto and Caesar dressing.)

Paying It Forward Staying engaged in his hometown was important to Ward, and he’s doing it with more than sandwiches. Ward says giving back to the community has always been important to him. Rather than donate to specific charities, Ward and his family try to be present for people who need them. “We’re just available,” he says of himself and Tiffiney. Whether it’s feeding the homeless or donating a whole bunch of athletic shoes, “I try to be whatever I need to be when there’s a need to be met.”

Ward shares his story, too. He’s visited schools, juvenile detention facilities, and prisons to talk about his journey and the decisions he made that kept him on the path to greatness. From the sound of it, Ward hasn’t made too many mistakes. But he always points out how close he was to throwing it all away during his tumultuous teenage years, when the lure of the streets was powerful and his discipline ebbed.

His father’s death in 2001 was an excuse to mess up, he tells the young guys he meets with. After spending a childhood training to

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Retirement has been harder than Ward ever thought it would be.

There are days when he questions the decision at all. “What did you do?” he asks himself sometimes. “You had opportunity, you had money, you could still be doing your thing!” He misses those fat paychecks. Who wouldn’t? But there are other things too. The smell of the gym. The feeling of getting his hand raised in front of tens of thousands of people. The roar of the crowd filling his ears.

Since walking away from the ring, nothing has given him the sensation he used to get walking into it.

But Ward isn’t trying to re-create that. He’s chasing other highs now: the euphoric feeling he has when his crew does a great show live on the air, the time he gets to spend just being a dad to his own five kids. He used to go away for weeks at a time. Now, he laughs, they whine when he’s out of the house for a few days.

Ward will always be known as one of the world’s best boxers. But he’s working to make sure his legacy is more than that. “You don’t have to be a fighter, you don’t have to be an athlete,” he says.

“Even though what we do is a lot of who we are, we have to work to not allow what we’re doing as our vocation to truly define us.”

These days, the ultra-competitive former boxer tries to maximize his potential in whatever he does, as a broadcaster, a businessman, a father, investor, or mentor—always holding himself accountable and asking how he can improve.

In other words, “Whatever my hands find to do,” he says, “I’m doing with all my might.”

Squint2MyLou

Ward delivers a severe right hook to Kovalev in the eighth round of his second match.

Looking back on his career now, Ward is finally able to bask in his professional accomplishments. That’s something he never did until he retired. “I didn’t allow myself to glance at the belts and say, ‘Wow, you’re pretty good,’” he says. Now, “I’ve had the opportunity to embrace what I did over the past 23 years.”

S.o.g.

Born in 1984, Ward started boxing when he was just 9 years old. By 2003, he claimed three major amateur championship titles, including the Under 19 National Championship.

The next year he became the first American boxer to win an Olympic gold medal in eight years, landing him a spot alongside the likes of Muhammad Ali, Sugar Ray Leonard, and Oscar De La Hoya.

Ward turned professional in 2004, quickly rising to worldwide prominence by racking up five world titles in two weight divisions. In 2011, Ward defeated World Boxing Classic Champion Carl Froch in the Super Six final in Atlantic City, unifying titles and making him the World Boxing Council and World Boxing Association Super Middleweight Champion of the World.

Getty Images: Jed Jacobsohn

Ward was named 2011 Fighter of the Year by every major media outlet and the Boxing Writers Association. During his undefeated reign, Ward ranked as the world’s best active boxer, pound for pound, by The Ring magazine and the Transnational Boxing Rankings Board.

Ward boasts an undefeated professional boxing record of 32 wins and zero losses, with 16 matches ending in a knockout.

Ward is a loving husband to his wife Tiffiney and a proud father of five children: Andre Jr.; Malachi; Champ; Amira; and Amari. A devout Christian, he incorporates his faith into every aspect of his life and is a strong role model to his fans around the world.

The Ward family resides in San Ramon, California.

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LISTEN UP!

by Jeanne Lee

Remember Must See TV from the 1990s? If you didn’t tune in, you risked being left out at the water cooler. Nowadays, though, it seems like everyone is raving about must-listen audio content. It’s a podcast frenzy out there—podcasts are the new radio but improved with digital-age enhancements that make them incredibly addictive. Millions of Americans have gotten hooked on them.

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If you haven’t tried podcasts yet, you might wonder why devotees are so passionate. Maybe you’ve heard friends rave about how thought-provoking This American Life is or how listening to Modern Love brought them to tears. Perhaps your kids or workmates are talking excitedly about Homecoming. Or how they just binged on Dirty John and really, really want you to listen to it.

Serial, only 27 percent of Americans had listened to a podcast, but the show’s wild popularity drew in millions more listeners.

After finishing Serial, Altfeder sought other true crime podcasts like S-Town, Dr. Death, and Who the Hell is Hamish? He found Revisionist History, in which Tipping Point author Malcolm Gladwell examines misunderstood people and events from the past. That podcast led him to another Gladwell endeavor, Broken Record, that has in-depth interviews with musical geniuses like David Byrne, Rufus Wainwright, and the late Tom Petty. Each new podcast seemed to lead him to several other must-listens.

Human beings are hardwired to love a good yarn, and podcasts deliver some really high-quality ones—right into your headphones, any time of day or night. “In the past, you’d have an orator standing in front of a crowd. Later, it was books on tape and then on CD,” says Jeremy Altfeder, financial advisor at CAPTRUST. “Podcasts aren’t unique, but their delivery is new. They’re in your ear. You don’t If you have a particular passion, have to go to them, they come right to you.” whether it’s knitting, Greek mythology, Two-thirds of Americans now listen to podcasts at least once in a while, and 23 percent listen a few times a week, according to a 2019 CBS News poll. That’s a sharp increase from a year ago, when the majority of Americans did not listen to podcasts.

theme parks, or whatever, there is probably a podcast in that niche that will impart a special feeling of having found your tribe.

Podcasts offer hours of rich entertainment and food for thought, waiting to be nibbled or devoured whenever you want it. There are bite-size news programs to help you start your day. Dramas to enliven car trips. And if you have a particular passion, whether it’s knitting, Greek mythology, theme parks, or whatever, there is probably a podcast in that niche that will impart a special feeling of having found your tribe.

Podcasts have existed since 2003 but were more or less on the fringe until the fall of 2014, when the true crime podcast Serial came out.

“Serial was what got me into podcasts. A lot of my friends were really into it,” says Altfeder. Right away, he was drawn in.

Serial tells the story of Adnan Syed, a man who has served many years of his lifetime sentence for murder. But a cloud hangs over his conviction: Did he really end the life of his former girlfriend in 1999, even though they were still friends? Or did a shoddy defense case doom an innocent man? One of Syed’s supporters brought his old case files to National Public Radio reporter Sarah Koenig, and she started looking into the case. Koenig talks to Syed from prison, tracks down people who knew him then, and interviews former classmates who could perhaps have provided an alibi. She becomes obsessed, and through her vivid storytelling, masses of listeners did, too. To date, the first season of Serial has been downloaded more than 200 million times.

Serial and its follow-up, S-Town, are “some of the best storytelling I have ever been exposed to,” says Greg Middleton, director of marketing at CAPTRUST, who is also a die-hard podcast fan. Before

Podcasts are such a treat for Altfeder that he now uses them to motivate himself to work out or tackle an unloved chore. “I hate mowing the lawn, but if I can put on my headphones and listen to a podcast, it’s like a reward,” says Altfeder. “It helps me not to have such distaste for something I hate doing. It’s like watching a really good movie—I get completely lost in it.”

The mental trick of pairing something fun with a dreaded job has a formal name in behavioral economics. It’s called temptation bundling. Thanks to podcasts, anyone who’s curious about this can download Freakonomics Radio to hear a full explanation directly from Katherine Milkman, the professor at the Wharton School at the University of Pennsylvania who coined the term. Altfeder listened to her experiments using the technique to help subjects coax themselves to go to the gym and meet their goals, similar to what he does for his own self-improvement. The episode is No. 200, “When Willpower Isn’t Enough,” if you want to give it a listen.

Before he found podcasts, Middleton was often bored on his morning commutes, listening to the usual talk radio and Top 40 pop songs. A friend suggested that TED talks might provide more stimulation, so he searched online for some and stumbled upon the TED Radio Hour podcast.

If TED talks are brain food, the TED Radio Hour podcast is a shot of concentrated vitamin B-12. Each episode takes on a big, captivating theme—extrasensory perception, altruism, or colonizing outer space are some examples—and explores it through an hour’s worth of the most interesting excerpts from various TED Talks. “Before you know it, your commute is over, and you wish it was longer,” says Middleton.

Another one he finds inspiring is Jocko Podcast. “I’m a goal-driven person. I like a military approach to life,” says Middleton. The show’s host, Jocko Willink, is a retired Navy SEAL who uses compelling military stories to discuss discipline and leadership in the business world. It isn’t necessarily everyone’s cup of tea, but 17

“

I hate mowing the lawn, but if I can put on my headphones and listen to a podcast, it’s like a reward. It’s like watching a really good movie—I get completely lost in it.

GREAT FIRST PODCASTS

Jeremy Altfeder, CFP®

With over 750,000 podcasts out there, according to Podcast Insights, it can be hard to know where to begin. Getting started requires only a smartphone—and maybe some headphones. Your device may have a built-in podcast app, like iPhone’s Podcast.

If not, you can listen through an app like Spotify, TuneIn, Stitcher, Overcast, Google Play, or iHeart, among others.

Middleton finds the podcast mentally nourishing, along with some others like The Tim Ferris Show and The Jordan B. Peterson Podcast.

Consider giving one of these hugely popular audio programs a try, and see if you get hooked on the world of podcasts:

”

A parent of active young kids, Middleton also relies on podcasts to sustain him through his daily routine with his family. “Anything that makes you better engaged when you’re doing dishes at 9:30 at night—when the kids have finally been put to bed and you still haven’t changed out of your suit—is a bonus. It helps me through that.”

• Story Corps—Heartfelt conversations about love, family, and the important things in life.

Podcasts are great to share with kids, particularly on road trips. “They solve the question of what to play in the car,” he says, “with something positive that helps them develop and grow.” Middleton’s family loves listening to Wow in the World, an NPR program with tantalizing science tidbits for kids. Middleton’s son enjoys it so much, “he wants to call in to the hosts and share cool science facts he learns in school,” he says. He wants to tell them his Wow in the World.

• TED Radio Hour podcast—Explorations of fascinating questions of human existence with TED Talk speakers.

Middleton’s even gotten his 71-year-old dad, an avid barbecue griller, interested in podcasts. “My dad was getting tips on his craft from YouTube videos,” but his vision isn’t that strong anymore. “He recently asked me to help him download some barbecue podcasts,” says Middleton. That’s right, barbeque is a podcast category with a surprising slate of titles: BBQ Beat, BBQ State of Mind, BBQ Central Show, Best Barbecue Show, and Behind the Smoke: BBQ War Stories—to name just a few.

Aficionados can listen to pitmasters from around the world riff on grilling techniques, sauce recipes, and the best in cooker technology.

So, whether your love is drama, news, history, linguistics, politics, or barbecue, there’s likely a podcast that’s perfect for you. Humans have always loved a good story, and now with podcasts, you can carry them around on your phone and listen to them anytime.

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• The Daily—Twenty-minute weekday deep dives into important news stories with New York Times journalists.

• Sleep with Me—This adult bedtime-story podcast combines the pain of insomnia with the relief of laughing to help you fall asleep.

• Throughline—Weekly show about the history missing from conversations around current events.

• Up First—Quick daily news roundup with NPR’s Morning Edition team.

• Serial—The juggernaut that launched the true crime genre of podcasts.

• Revisionist History—Author Malcolm Gladwell takes a second look at events, people, and ideas from the past to see what might have been misunderstood or overlooked.

• Crime Junkie—Every episode is dedicated to a different crime story, and episodes are typically 40 minutes to an hour.

OVERSEAS

PROPERTIES

by Kim Painter

When some people think of retirement, they imagine themselves on a Carolina beach or an Arizona golf course.

Merl Baker saw himself somewhere very different: at the opera, symphony, or an art museum in Berlin, Germany, with his wife, Rita. This year, the couple made that vision a reality.

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Mazatlán Harbor, Mexico

Santo Domingo, Dominican Republic

Merl, who is 66, retired from his job as a partner at NMG Consulting in Stamford, Connecticut. Soon afterward, he and Rita, a retired high school German teacher, also 66, embarked on a new life. Merl and Rita now live half the year in Berlin, in an apartment they bought more than a decade ago, and the rest of the year on their sailboat in Maine or at their longtime home in Greenwich, Connecticut.

Whether to Buy at All

“There are oceans to be sailed, mountains to be skied, and operas to be heard,” Merl says.

Even if you have been to your dream destination several times, you can never have enough information, experts say.

While many Americans who purchase property abroad have different priorities, including golf and beach time, the Bakers’ choice to buy a home in a foreign land is an increasingly common one, experts say.

But it’s not a decision to make without careful planning and a lot of soul searching, says Dan Prescher, senior editor at International Living magazine.

“

You should rent first. And six months is probably the minimum. In six months, you’ll know whether you’ve picked the right neighborhood or not.

Dan Prescher

“Moving abroad is not for everybody. It’s not even for most people,” he says, though it has been a great experience for him and his wife, Suzan Haskins. The two journalists, who met and married in Omaha, Nebraska, have lived in seven different communities in four countries over the past two decades. They have purchased two homes in Mexico and one in Ecuador and learned a little each time, he says.

Kathleen Peddicord has had even more learning experiences. The founder of the Live and Invest Overseas publishing group currently divides much of her time between homes she and her husband, Lief Simon, own in Paris, France, and Panama City, Panama. The couple, avid investors, own properties in 24 countries.

Here’s what Prescher, Peddicord, and other experts say Americans should consider before buying a home in another country.

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Let’s say that, over the course of a few vacations, you fall in love with the lifestyle in Mazatlán, Mexico, or the Algarve region of Portugal. Perhaps you find yourself envying friends making a killing renting out their condo in the Dominican Republic—when they aren’t there sipping rum themselves.

”

“You should rent first. And six months is probably the minimum,” Prescher says. “In six months, you’ll know whether you’ve picked the right neighborhood or not. You’ll know when the church bell rings, what the street is like when the rain comes, and how bad the bugs get on your side of the hill.”

His advice: “Stay long enough to learn what your deal breaker might be.”

Peddicord agrees. “If you decide this city isn’t for you or this country isn’t for you, you just cancel the lease or wait for it to expire and move on.” Or, she says, “you may decide to keep your options open by continuing to rent—a choice that often makes good financial sense.”

Even if you are buying an overseas home primarily as an investment and rental property, you should pick a spot that you will be happy to visit many times, she adds. “Expect you are going to be there at least once a year to check in with the rental manager and oversee maintenance,” she says. “People who buy properties in places they would not live themselves can end up resenting the time they have to spend there,” she says.

Algarve region, Portugal

Paris, France

A World without the MLS or Zillow When you shop for a home in the U.S., your first stop is often an online listing site, such as Zillow, Trulia, or Realtor.com, where you can see and compare many homes on the market, complete with exhaustive slideshows, sales, and tax histories. At some point, most people also check in with at least one real estate agent who knows the target neighborhood.

WHERE’S THE BEST PLACE TO LIVE ABROAD?

Undergirding the whole system is the Multiple Listing Service, or MLS, a comprehensive database of all the homes listed by agents and brokers in any given area. A home listed on the MLS should have the same price no matter who is showing it.

There is no one answer, of course. One person’s paradise is another person’s nightmare.

Forget all of that when you shop for a home outside the U.S., Peddicord says. “The MLS concept does not exist elsewhere, and a home may be listed with multiple agents for multiple prices.”

And shopping online? “Google is not your friend,” Peddicord says. “What you find is likely to be confusing, misleading, or downright wrong.” She says that agents seeking foreign buyers in some markets engage in bait-and-switch tactics, and the homes you see online will not be what’s actually available.

The solution is lots of legwork. Talk with other expatriates about their experiences, and find more than one agent to show you properties, Peddicord advises.

And stay skeptical, she says. “Take everything a real estate agent tells you with a grain of salt. In most places, they can say whatever they want to try to make the sale.”

Getting Legal Help Does the person selling you a home have the legal title to that home? Are the taxes paid up? Are there any access concerns? To avoid tripping over such issues, you will want a lawyer who represents your interests to scrutinize every aspect of the sale, Peddicord and Prescher explain. This person should speak the local language, have lots of experience working with Americans, and be able to explain everything to you in your own tongue, they say.

But the experts at International Living put out a list with a little something for everyone each year. The publication considers factors such as affordability, climate, and health care. They also consider how enthusiastically each place welcomes foreign residents.

Here are International Living’s top 10 places to retire in 2019: 1. Panama

6. Colombia

2. Costa Rica

7. Portugal

3. Mexico

8. Peru

4. Ecuador

9. Thailand

5. Malaysia

10. Spain

Get recommendations from other expatriates in your target community—many have Facebook groups and other online gathering spots—and interview several lawyers before making a choice, Peddicord advises.

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If you plan to live in your property for more than a few months a you are living a drive away in Mexico or a daylong series of costly year, your lawyer can also help you wade through options for flights away in Vietnam or Bali. becoming a legal resident of your adopted land. Some countries make it easy, Healthcare expenses are another major Don’t forget to consider the cost especially for retirees with healthy pension concern. In some places, Americans checks and bank balances. can enroll in national health plans or of travel—both to explore your buy good local insurance for very little, new environment and to get Your lawyer may help you with other Peddicord says. In other matters as well. circumstances, people will want to back home from time to time. purchase international policies, she Rainelda Mata-Kelly, a Panama City says. And still others will decide they lawyer who specializes in working with foreign homebuyers, says don’t need health insurance that covers their basic local care, American clients are often surprised when she suggests she because it is so affordable. accompany them to a local bank to set up an account. “Opening a bank account in Panama is quite complicated,” she says. “Having Prescher says he and his wife have found medical and dental care to the right paperwork and having an introduction to the bank be good and surprisingly affordable in their Latin American locales: manager will make your life much easier.”

“I’ve had a lot of dental work done and rarely paid more than $150 for anything, including crowns and extractions,” he says.

Understanding Your Tax Situation

Moving abroad, for part or all of the year, does not put you out of the reach of the Internal Revenue Service. You still must file a tax return and may owe taxes. But Americans earning money while living abroad benefit from the foreign earned income exclusion, which allows you to earn a certain amount before U.S. taxes kick in.

While your new home country may also send you a tax bill, foreign tax credits and tax treaties that forbid double taxation may greatly ease your burden in many places, Peddicord says.

Baker—the opera lover who bought a Berlin apartment—says one reason he and his wife won’t live there for more than six months a year is that German taxes would kick in one day past six months on the income he expects to earn working part time for his former full-time employer.

Bottom line: Get a tax advisor familiar with the ins and outs of overseas living.

Planning for Routine Expenses One reason for renting before you buy: It gives you a chance to live like a resident, not a tourist—to discover the grocery stores, restaurants, merchants, and transit options you will use in everyday life. Many people discover they can live much more cheaply as residents than vacationers, Peddicord and Prescher say.

But don’t forget to consider the cost of travel—both to explore your new environment and to get back home from time to time. If you expect to return to the U.S. several times a year, it matters whether

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One caveat: Peddicord urges Americans to sign up for Medicare at age 65, even though they can’t use it abroad—because they will pay a penalty for signing up later if and when they return to the U.S.

Considering Your Exit Strategy Maybe you plan to live out your years abroad, but then something happens. That something is often a serious health issue or, more happily, the arrival of grandchildren back in the U.S., Prescher says. In fact, he says, he and his wife have spent extra time back in Omaha this year—in one of two homes they own there—to be with their 5-year-old granddaughter.

Having an exit plan means keeping your options open, he and Peddicord say. For some people, that means maintaining a home in the U.S. that you may or may not rent out while you are gone, or simply maintaining the financial flexibility to return. When you buy real estate abroad, just as when you buy domestically, you want to consider resale potential.

Then there’s the ultimate exit plan: your estate planning. Make sure you have a will and other documents that will hold up legally in the country where you own property.

For those considering purchasing a property abroad, there’s much to consider and many stones to be overturned. Some of the most important pieces of your plan should include experiencing the area, often, before you commit to anything, and also engaging the help of expert resources.

Places & Prices

Thinking about living in a different part of the country—or a different part of the world?

We’ve checked with Numbeo, the largest database of user-contributed information, about cities and countries worldwide and came up with a bite-size sampling of how much housing, food, and fuel your U.S. dollars will buy around the world today.

Newport, Rhode Island

Nice, France

Jupiter Beach, Florida

San Cristóbal de las Casas, Mexico

Barcelona, Spain

Bangkok, Thailand Kuala Lumpur, Malaysia

Salinas, Ecuador

Brisbane, Australia

Cape Town, South Africa

$1,566

$6.00

$63

$1,475

$5.58

$60

$1,133

$4.00

$55

$1,078

$3.82

$50

$3.76

$44

$848 $713

$3.74

$32

$710

$2.81

$26

$558

$2.69

$19

$533

$18

$164

$2.11

$11

$/Month

Dinner for two

$1.91

$/Gallon

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SAFE TRAVELS

by Jeanne Lee

These days, it’s hard to take a vacation without staying connected. Checking in for flights, finding hotels, and booking rideshares is all frequently done through mobile apps. Whether you’re navigating to a Parisian pied-à-terre or a luxury resort in Costa Rica, along the way you’ll likely need to visit unfamiliar websites, use public Wi-Fi, and possibly use an airport charging station to keep your cellphone from dying. Meanwhile, cybercriminals around the globe are developing ever more sophisticated phishing, ransomware, and man-in-the-middle schemes.

No wonder cyberthreats for travelers are a bigger worry than ever before.

“Overall, the threat landscape is dramatically more dangerous for travelers today,” says Bart McDonough, chief executive officer and founder of cybersecurity firm Agio and author of Cyber Smart: Five Habits to Protect Your Family, Money, and Identity from Cyber Criminals.

“Most of us in our cyber-life are constantly walking through a bad neighborhood—you can get pickpocketed online four times a day in the U.S.,” says McDonough. “But when traveling to places like Southeast Asia, parts of the Middle East, or Eastern Europe, it’s like going into a really bad neighborhood.”

Just a few years ago, the main worry for technology-wielding jet-setters would have been coming home with a virus-infected laptop that you might have to toss.

Now, the stakes are higher. “Breaches usually result in loss of money, whether through a ransomware attack—in which your data is held until you pay—or some kind of wire transfer fraud,” says McDonough.

“

Breaches usually result in loss of money, whether through a ransomware attack—in which your data is held until you pay—or some kind of wire transfer fraud.

Bart McDonough

Increasingly, it’s your smartphone the bad guys are attacking. “Cybersecurity threats are more mobile-focused compared to five years ago. A lot of people are using mobile devices instead of laptops while traveling now,” says Jon Meyer, CAPTRUST’s chief technology officer. “There is a constant stream of bot-related phone calls and bot-related texting that wasn’t there before.”

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”

Your Devices Are Showing How vulnerable is your smartphone? iPhones inherently provide better cybersecurity than most Android phones, says McDonough. “I recommend an iOS device when traveling, because the Apple ecosystem tends to be far safer than Android.” iPhones are far less likely to become infected by viruses attached to phishing emails, since Apple keeps strict controls over what software developers do within the iOS system.

Similarly, iPads are more secure than laptops, so they’re an excellent choice for reading documents or spreadsheets on the road. “If you can get away with it, leave your laptop at home and take your iPad,” McDonough says. “The number of malware attempts on laptops is probably in the millions each year, but on the iPad, I bet it’s in the single digits.”

Among Android phones, a Google Pixel may be the best bet from a cybersecurity standpoint. The reason? “Google Pixel devices are safer than some of the other Android devices, because Google owns both the hardware and the software. That means they’re able to push more timely software updates. With Samsung, which only owns the hardware, they have to rely on Google for the software. That can create gaps and delays in updates, which is music to the ears of hackers,” says McDonough.

Something that is Something that is important for all devices is keeping the operating system up to date. Cybercriminals take advantage of the fact that it’s human nature to procrastinate on updates, and they carefully study known bugs in outdated versions. “When Apple releases an update that fixes four or five things, the bad actors go to the previous version and start figuring out how to exploit them,” says McDonough.

important for all devices is keeping the operating system up to date.

Cybercriminals take advantage of the fact that it’s human nature to procrastinate on updates, and they carefully study known bugs in outdated versions.

Got Public Wi-Fi? Connecting to free Wi-Fi in public places isn’t quite as risky as it used to be, especially in large airports or major hotel chains that contract with top-tier internet service providers.

Most websites now routinely encrypt your data as it travels to and from their servers—this is indicated by the “https” in the web address—so any hackers who intercept information from your device are unlikely to be able to decode it.

Even so, be judicious about free networks, especially those in small, independent businesses.

“Don’t connect to every Wi-Fi in a restaurant to share pictures of your food on Instagram,” says Meyer. “If you’re making a banking transaction or entering credit card information, it’s best to wait till you’re on a trusted network.”

Do you need a virtual private network (VPN)? Business travelers often use a VPN to encrypt data and keep location and identity information secret when using public networks.

Individuals can subscribe to a service like Express VPN, NordVPN, or IPVanish to use while on your laptop or phone, but experts say that for casual users, it might not be worth the expense and inconvenience. “A lot of people don’t like how it slows down the speed of browsing,” says Meyer. “Unless you’re working with sensitive business or financial information, a VPN may not be necessary.”

Instead, for those times when you’re worried about privacy, “We tell people to use their cellphone data. It’s slower and you do pay for it, but it’s safer than connecting to anyone’s Wi-Fi,” says Meyer.

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Social Media Maneuvers Posting on Facebook or Instagram? A simple message like “Maui, here we come!” could tip off criminals that your house is empty and unguarded. “In one incident, people were using bots to collect information about anyone in New York City who posted on Facebook or Twitter that they were going out of town and selling it to local criminals,” says McDonough. It’s safest not to post travel itineraries, photos of boarding passes or passports, or pictures with location details.

release in August 1968, add special characters like exclamation points, and capitalize with the beat, like this: HjdmiB08!TaasSamiB68.

Using unique passwords for each site is safer than repeating passwords. McDonough recommends downloading a password manager like LastPass or 1Password to keep track of them all.

In one case, a high-net-worth individual was targeted by hackers after the website of his daughter’s school sports team was compromised. “His Gmail account had the same password as the sports site. Your email account is basically a gateway to your online financial accounts,” says McDonough.

Even setting your Facebook posts to “friends only” isn’t foolproof, because there could be impersonation accounts lurking within your friend network. “If you’ve ever received an invitation to connect from someone that you thought you were already connected to, there’s a good chance it was a bot-created fake Weak passwords make online account attempting to infiltrate your accounts vulnerable. If you’ve resorted network,” McDonough says.

“One celebrity does this on Instagram: The first time she posts a picture, she leaves the location blank. When the trip is over, she goes back and updates her location,” McDonough says. That’s a safer way to enjoy posting travel photos on social media.

to easy passwords, like your favorite sports team or the classic “123456,” take a few moments before your trip to put stronger ones in place.

Protect Your Passwords Weak passwords make online accounts vulnerable. If you’ve resorted to easy passwords, like your favorite sports team or the classic “123456,” take a few moments before your trip to put stronger ones in place, especially on your financial and email accounts. Consider that hackers can generally decode nine-character passwords in five days, 10-character passwords in four months, and 11-character passwords in 10 years, according to Meyer.

His tactic for generating passwords is using song lyrics. Take this example of a Beatles lyric: “Hey Jude, don’t make it bad. Take a sad song, and make it better.”

String together the initial letters for a unique password, like this: HJDMIBTASSAMIB. To make it even stronger, add numbers corresponding to the song’s

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The hackers looked through the individual’s emails to find out about his banking and brokerage accounts, then used his email account to reset his passwords on those accounts and gain online access. “They’ll often do the password reset at 2:00 am or 3:00 am and then delete those emails, so you’ll never see it,” says McDonough.

Do the Two-Step Hundreds of millions of Americans have had data compromised through the huge corporate data breaches of recent years, like Equifax, JP Morgan, and Target. If you want to add an extra layer of protection to online accounts like Apple, Google, Microsoft, email, and financial accounts, go into the settings menu and turn on the security feature called two-step authentication, or multifactor authentication. The next time you sign in, you’ll be prompted to enter a random numerical code that will be sent to you by text or email in addition to your password. If your password is ever compromised, your accounts will still be secure.

“If I could only recommend one thing, it would be to enable two-factor authentication. You should really do it every time because it makes every password unique,” says McDonough.

A final tip: Leave unneeded technology at home, McDonough says.

“At one point, around a third of data breaches resulted from people losing devices. If you bring your laptop with you, there’s always a chance you could lose it and then someone could suck your data off it. So, if you only really need a phone, just bring a phone.”

THE GRAVITY-DEFYING WORLD OF NEGATIVE INTEREST RATES

by Kevin Barry and Sam Kirby

There are some ground rules in life that we simply know to be true. Of the four Gabrielle Burke

fundamental forces of nature, the most tangible is the force of gravity. We know instinctively that our dropped coffee mug will fall—and that the coffee that’s spilled will run downhill.

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Figure One: 10-Year U.S. Treasury Yields (1962-Present) 18 16 14

Yield (%)

12 10 8 6 4 2 0

1965

1970

1975

1980

1985

1990

1995

2000

2005

2010

2015

Source: Bloomberg

As if pulled by gravity, interest rates across the globe have been falling since the financial crisis. In the U.S., the yield on a 10-year Treasury has fallen from 5 percent in mid-2007—which was not far from its nearly 60-year average of approximately 6 percent—all the way down to 1.47 percent in August. As shown in Figure One, virtually all of the instances when the 10-year Treasury’s yield fell below 4 percent have occurred since 2007.

represents a sizable and growing share of the global bond market.

Worldwide, more than $17 trillion of bonds carry negative yields.

That number represents about 30 percent of the global bond market, according to a recent Bloomberg article on the topic.

But what are negative interest rates and how did we get to this point? Why would anyone tolerate them? And what should an investor do in a world turned on its head?

Within the U.S., the impact of falling rates has been mixed. Low interest rates have helped stimulate The World Turned Upside the economy by reducing borrowing Down Unlike Newton’s apple, which stopped costs for both consumers and falling once reaching the ground, businesses. Everything from One way to think about interest rates borrowing to buy a house or car to is that they represent the price of interest rates in some countries have issuing bonds to build a factory or money. If you want to borrow more continued falling below 0 percent— buy back stocks has been cheaper as of it, it is only reasonable to expect a result of lower interest rates. And to pay lenders for the privilege. We into negative territory. because bond prices move opposite all know that there is no free lunch. yields, investors have seen strong total returns from bond portfolios through the combination of price For corporations and governments, such borrowing typically takes appreciation and yield. the form of issuing bonds. Like a mortgage, the issuer of the bond (the borrower) agrees to repay the face value of the bond (the loan On the other hand, savers looking for interest income from their amount) at the maturity of the bond to the investor (the lender), savings or retirees trying to generate reliable streams of income along with a stated amount of interest. This is the way the bond from their retirement assets have suffered. world has worked for thousands of years. In fact, as shown in Figure Two, scholars can trace the interest rates on bond issuances as far In many parts of the world, the situation is even more extreme. back as 3000 B.C. Unlike Newton’s apple, which stopped falling once reaching the ground, interest rates in some countries have continued falling As a larger share of the global bond market flips into negative below 0 percent—into negative territory. The phenomenon of interest rate territory, we have seen some shocking headlines. A negative interest rates, once viewed as a financial oddity, now recent USA Today headline read, “Bank will pay customers to take 28

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Figure Two: Interest Rates in Babylonia, Greece, and Rome

out mortgages by offering negative interest rates in Denmark.” In a world where the interest rate is negative, not only is the lunch free, but the restaurant is paying you to dine there.

40% 35% 30%

Interest Rate

Here is a scenario to help illustrate how such a bizarre event could occur. If the coupon on a 10-year U.S. Treasury was 1.625 percent and you were to purchase $100,000 of this bond at par value—or $1,000 per bond—you would receive $1,625 in interest payments each year. And at the end of 10 years, you would receive back your $100,000 in principal. Because the entirety of your initial investment was returned to you, the total return on this bond is represented by the annual coupon payments, and you would have enjoyed a yield of 1.625 percent.

45%

25% 20% 15% 10% 5% 0%

3000

1900

700 600 500 400 300 200 100

B.C.

100 200 300 400 500 A.D.

Now imagine you are a bond investor in Babylonia Greece Rome Germany, where interest rates have turned negative. Instead of paying par for a 1.625 percent coupon bond, you may have to pay Source: Homer, Sidney, A History of Interest Rates: 2000 B.C. to the Present, New Brunswick, NJ: Rutgers a premium over par. For example, you University Press, 1963 could pay $127,000 for a bond with a face amount of $100,000. Because coupon payments are calculated against the face value of the bond—not the price paid—you would receive the same Imagine you are a bond investor in $1,625 in interest income each year as the U.S. investor, and you Germany, where interest rates have turned would likewise receive a $100,000 return of principal in ten years.

In this case, the total return of the bond is not equal to the 1.625 percent interest received. Because the cumulative amount of interest payments—or $16,250—is not enough to offset the $27,000 premium paid upfront, the annualized total return on the bond becomes a bizarre -1 percent.

Even if the bond math illustrated above makes sense, an important question remains: Why would a rational investor choose to buy this value-eating, negative-yielding bond? There could be several reasons:

negative. Instead of paying par for a 1.625 percent coupon bond, you may have to pay a premium over par. For example, you could pay $127,000 for a bond with a face amount of $100,000.

• Negative inflation. Even if an investor loses a little bit of purchasing power due to negative interest rates, if the overall level of prices in the economy decreases more, he or she still comes out ahead.

• Profit motive. Instead of holding the bond to maturity, an investor may believe that already-negative rates will decline further. If that happens, he or she can sell the bond and make a profit. This is referred to as the greater fool theory.

• Risk aversion. If an investor is concerned about the future prospects of the stock market and other risky assets, a slightly negative interest rate may be acceptable as “the devil you know.”

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• No choice. Some investors with structural needs, such as insurance companies or pension plans, are required to match a future guarantee with current assets. They may simply have no choice but to invest in negative-yielding bonds.

• Passive investors. A passively managed mutual fund or exchange-traded fund that seeks to mirror a bond market index would purchase bonds regardless of yield so that it can meet its investment objective.

• Noneconomic buyers. Some buyers, such as central banks trying to inject liquidity into their economic systems to stimulate growth, are simply not price-sensitive buyers. They have other goals and would purchase bonds regardless of negative yields.

How Did We Get Here?

growth. By 2015, with an unemployment rate of 5 percent—down from 10 percent in 2009—and inflation beginning to reemerge, the Federal Reserve had begun to reverse course and raise rates.

Facing the challenges of a less dynamic economy, demographic headwinds, and continued bank weakness, the response to rate reductions in Europe was less robust. European banks, still struggling to rebuild their capital reserves, were content to hold excess reserves at the ECB—even if they earned no interest—rather than lend out much-needed capital to businesses and consumers.

This prompted the ECB to embark on an economic experiment on a grand scale; it reduced short-term policy rates below 0 percent in mid-2014 with follow-on rate decreases moving the policy rate to -0.4 percent, where it stands today. This dramatic policy was intended to Lower interest rates make it less provide a jolt to the system. If deposits were penalized through the direct cost expensive for borrowers to borrow of negative rates, banks should be much and provide less incentive for more willing to lend.

Central banks, such as the U.S. Federal Reserve and the European Central Bank (ECB), cut policy interest rates—such as savers to hoard cash. the fed funds rate—to stimulate their So far, this policy has failed to work. countries’ economies. Lower interest And this extreme policy has also raised rates make it less expensive for borrowers to borrow and provide concerns about the potential unintended consequences, such as less incentive for savers to hoard cash. As shown in Figure Three, asset bubbles, if investors hungry for yield seek out ever-riskier the Federal Reserve began to cut short-term interest rates in 2007, investments. taking the fed funds rate from 5.25 percent all the way down to 0.25 percent by the end of 2008. The ECB followed suit, cutting its How Long Can Low Rates Persist? short-term rate from 3.25 percent in 2008 to 0.25 percent by mid-2009.

Despite the stronger economic picture in the U.S., recent concerns over the negative impact of trade tensions have placed downward Although their policy actions were similar, the results of these pressure on interest rates. The Federal Reserve again responded to actions in the U.S. and Europe have been quite different. Monetary slowing growth prospects with its primary monetary policy tool. At stimulus, combined with the more dynamic economic the end of July and again in late September, it reduced the fed funds underpinnings in the U.S., helped stabilize the economy and restart rate by one-quarter of 1 percent.

Figure Three: Federal Reserve and ECB Short-Term Rates

6.0 5.5 5.0 4.5 4.0

Interest Rate (%)

3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 -0.5 -1.0 2005

2007

2009

Federal Funds Target Rate - Lower Bound

Source: Bloomberg

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2011

2013

2015

ECB Deposit Facility Announcement Rate

2017

2019

Figure Four: Year-to-Date Total Returns for U.S. Stocks and Bonds

1.1.2019 - 09.30.2019

Year-to-Date Total Return

U.S. Stocks

20.6%

U.S. Bonds

8.5%

10-Year U.S. Treasury Bond

9.9%

Source: Bloomberg. U.S. Stocks are represented by the S&P 500 Index, U.S. bonds by the Bloomberg Barclays U.S. Aggregate Total Return Value Unhedged USD Index, and the 10-year U.S. Treasury by the Bloomberg Barclays US Government 10-Year Term Total Return Index.

Importantly, the U.S. has also Investors should heed a few Importantly, the U.S. has also shown a shown a willingness to employ important reminders as we willingness to employ another powerful another powerful policy tool: fiscal consider the effects of an extended stimulus. The passage of the Tax period of low or negative global policy tool: fiscal stimulus. The passage of Cuts and Jobs Act provided fuel to interest rates: the Tax Cuts and Jobs Act provided fuel the growth engine in the form of corporate and individual tax cuts • Lower interest rates, while to the growth engine in the form of and increased government signaling lower income ahead, corporate and individual tax cuts and spending. Notwithstanding have served to boost the price of longer-term concerns over the size bonds and other investment assets, increased government spending. of government budget deficits and such as real estate and stocks. As the national debt, the combination shown in Figure Four, in 2019, of monetary and fiscal policy has proven to be potent. Like oars in a every $1 of increased bond prices has been accompanied by a canoe, these policy tools are best when used together. $2 increase in stock prices. Through the end of September, the total returns for U.S. bonds and stocks are approaching 10 So far, Europe has not shown a willingness to use its fiscal tool. In percent and 21 percent, respectively. fact, Germany has moved in the other direction, reducing government debt over the last nine years. Like a canoe with one oar, • Fixed income is still an important part of a diversified Germany has been traveling in circles rather than toward its investment portfolio. Bonds remain an important tool to intended destination. counterbalance stock market volatility. And although investors should expect less from their bonds in the next several years, If the headwind of global trade tensions were reduced meaningfully, they will still provide income to portfolios. the U.S. economy could regain its growth footing and this, combined with higher debt levels, could pressure rates higher.

• Investors should consider alternatives to stocks and bonds.

Europe, on the other hand, could face exceptionally low—or Where appropriate, diversifying investment categories such as negative—rates for longer given its structural issues. infrastructure, real estate, private equity, and credit may offer risk reduction and market returns that are less correlated to Investor Impact of Low (and Negative) Rates traditional asset classes.

The concept of negative interest rates is enough to leave readers and investors scratching their heads—especially those in or nearing retirement with a need to generate income. It is a challenge likely to persist for some time, even if negative rates do not materialize on U.S. shores. It appears that our current low-interest-rate environment is not going away any time soon.

As always, an investor’s best defense against uncertainty is a diversified portfolio that is properly matched to his or her tolerance for and ability to withstand risk. In a world with low, if not negative interest rates, having a sound financial plan that considers longterm income needs relative to sources of income and the need to preserve principal becomes even more important.

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SOLID YEAR DESPITE Q3 TURBULENCE Most asset classes added to their 2019 gains in the third quarter, despite attention-grabbing headlines and fears of waning global economic growth. While periodic bouts of news-driven market volatility have irked investors, their patience has been rewarded with generous gains so far this year.

• Despite concerns about slowing economic growth and the ongoing trade dispute with China, U.S. stocks added to their impressive gains and closed out their best first three quarters since 1997.

• International stocks slipped this quarter—weighed down by emerging markets and a strong dollar—but remain in positive territory for the year.

• Bonds rallied again this quarter, building on their year-to-date gains, as interest rates rose from multiyear lows.

• Public real estate held on to strong gains, thanks to subdued interest rates and favorable market demand. It is this year’s standout performer.

27.9%

• Strategic opportunities posted a small gain for the quarter and lag all other asset classes for the year.

20.1%

MARKET INDEX PERFORMANCE (as of 9.30.2019)

Q3 2019

YTD 2019

12.1% 8.5%

1.1%

2.8%

7.3%

2.3%

Strategic Opportunities

U.S. Bonds

1.2%

-1.7% International Stocks

U.S. Stocks

Real Estate

LOOKING FORWARD Escalating trade tensions have dampened business confidence, lowered global economic growth expectations, and increased the likelihood of a recession. Meanwhile, the Federal Reserve cut short-term interest rates in July and September and may cut further if conditions deteriorate; the European Central Bank has signaled similar accommodative policies.

We are monitoring economic conditions for further signs of weakness, and we are following several issues that could cause renewed market volatility such as Brexit, developments in the U.S.-China trade dispute, the U.S. presidential impeachment process, and next year’s presidential election.

Asset class returns are represented by the following indexes: Russell 3000 Index (U.S. stocks), MSCI All-Country World ex-US Index (international stocks), Bloomberg Barclays U.S. Aggregate Bond Index (U.S. bonds), Dow Jones U.S. Real Estate Index (real estate), and HFRX Absolute Return Index (strategic opportunities).

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THE FUZZY MATH OF SOCIAL SECURITY

by John Curry

Early this year, the financial and mainstream media generated dozens of stories about how nearly all American retirees—some 96 percent of them— are filing to begin receiving Social Security benefits at the wrong time.

These stories—based on findings from a study performed by money manager United Income—claim that only 4 percent of retirees are making the financially optimal decision to wait until age 70 to begin receiving benefits. And, while delaying until 70 seems like a stretch, most would benefit by waiting at least until age 65.

As a result of their choices, “they will miss out on a collective $3.4 trillion in benefits before they die,” according to a Bloomberg article on the topic.

That’s a lot of money being left on the table. So much that you must ask yourself: Why is this happening?

As you would expect, that question has many potential answers— some practical and some more esoteric.

Practical Explanations Practically speaking, there are many partial answers. For example, some of these retirees may not have had access to good software, tools, or advice to help them make this important decision, so they made the only one that made sense to them.

According to Federal Reserve data, the median and most common retirement age in the United States is 62. You know what else it is?

It’s also the minimum age at which you can start collecting Social Security benefits.

Arguably, the reduced benefit available at the early eligibility age of 62 is a financial incentive to file. In other words, getting something today—even at a reduced rate—is better than what I could have received yesterday.

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This urgency has been fueled by Social Security staffers who have inappropriately told people who make benefit inquiries to “Take your benefits because you could die tomorrow,” says Laurence Kotlikoff, professor of economics at Boston University and author of Get What’s Yours: The Secrets to Maxing Out Your Social Security.

It is understandable that some fraction of filers may want to tap into their benefits early to make sure they get out what they put in—even if they aren’t optimizing.

And, of course, with the negative press we periodically see about benefit cuts or the solvency of the Social Security trust fund, it is understandable that some fraction of filers may want to tap into their benefits early to make sure they get out what they put in—even if they aren’t optimizing.

No doubt there is a kernel of truth in these explanations, but that doesn’t explain the overwhelming miscalculation that Social Security filers repeatedly make.

The fact is: There are several aspects of the Social Security filing decision that simply confound the human brain. These behavioral biases, as they are known, can render humans unable to make optimal—or sometimes even OK—decisions about their financial lives. Arguably, there could be numerous biases negatively influencing the Social Security filing decision, but let’s focus on two.

Immediate Gratification The first of these biases is called present bias. Present bias is the idea that an individual will place greater value on something received in the present moment, rather than waiting to receive it in the future. It suggests that, given the choice between a payoff today and a payoff in the future, we tend to choose the payoff now—otherwise known as immediate gratification. This is true even for decisions that our future selves may regret.

In a nutshell, we see the future self we are delaying gratification for as a separate person from our current self, making the decision in question a choice between doing something for ourselves today or doing something for a stranger tomorrow.

In the case of Social Security, present bias causes millions of Americans to value—and therefore file to receive—benefits today versus benefits later, despite the significantly higher payouts they’d receive if they waited. Of course, present bias is not limited to the Social Security decision. It is—pardon the expression—ever present in our lives.

Present bias is why we splurge on a big vacation or a lavish purchase today and fail to start saving.

It’s why we claim we’ll save more later, after we get a raise or bonus, but don’t. It’s why we eagerly commit to dieting or a new exercise regime—so long as we get to start it tomorrow.

We see the certain and immediate costs to these choices and weigh them against murky benefits in the distant future. Immediate gratification wins almost every time.

Fuzzy Math The other behavioral bias worth mentioning is called exponential-growth bias. Exponentialgrowth bias is the tendency to undervalue the effects of compound interest, leading to the underestimation of future values. Because we are very bad at these calculations, our underestimation can be massive.

Victor Stango and Jonathan Zinman from Dartmouth College wrote about exponential-growth bias in their 2007 paper, “Fuzzy Math in Household Finance: A Practical Guide.” They point out that exponential-growth bias is relevant to household finances in two ways. Unchecked, exponential-growth bias means that people will get the future value of savings or investments wrong, 34

Fall | 2019

especially “when the opportunities are relatively long-term and/or high-yielding,” say Stango and Zinman. “They underestimate returns because they underestimate how quickly interest compounds.”

Exponential-growth bias also leads to underestimation of interest costs on borrowing. “This problem is the mirror image of understanding compound interest,” say Stango and Zinman.

The net result is that households with a strong exponential-growth bias tend to save less and borrow more—a double-edged sword of bad financial behaviors.

Back to Social Security. Exponential-growth bias is part of why filers are more likely to file for benefits before full retirement age. It causes them to undervalue the benefits of waiting.

Further, because many people are cash poor, “they can’t wait until age 70 to collect their retirement benefit when they’d be roughly 70 percent higher, after inflation, than if they started claiming at age 62,” says Social Security expert Laurence Kotlikoff. They can't grasp the real value of waiting.

The fuzzy math challenge of Social Security is further complicated by the fact that Social Security pays an inflation-adjusted income until you die—and most filers are not capable of valuing the longevity insurance and inflation protection that’s built into benefits. But that’s a story for another day.

Of course, all is not lost. You can, in fact, overcome the challenges of our flawed human wiring when it comes to maximizing Social Security benefits. What can you do?

Here are a few suggestions: • Estimate your benefits. Through the Social Security Administration’s website at ssa.gov, you can get a personal benefit statement that takes into account your earnings over the years.

From there you can model the impact of taking benefits before and after your full retirement age—and clearly see the value of waiting.

• Plan to maximize benefits. Not everyone can afford to delay taking benefits until age 70. A comprehensive retirement plan that looks at your expected retirement spending and potential sources of income can help you understand if it’s possible to delay or when you’ll need to start taking Social Security benefits.

The fuzzy math challenge of Social Security is further complicated by the fact that Social Security pays an inflation-adjusted income until you die—and most filers are not capable of valuing the longevity insurance and inflation protection that’s built into benefits.

• Shock test your plan. As the saying goes, “No plan survives contact with the enemy.” Make sure your plan includes extreme scenarios, including living to 100 (or older!), a significant market sell-off the year you retire, a Social Security benefit cut, and a sustained increase in spending—whatever you need to test to make sure you’re going to sleep at night.

• Reserve the right to reassess. Retirement is not a set-it-and-forget-it endeavor. It’s an iterative process. Update your plan periodically—every three to five years or whenever you’ve experienced a significant change—and be prepared to adapt. Sustained good or bad markets, a sudden change of health status, or sale of property are all excellent reasons to loop back and reassess your plan.

If you’re reading this, chances are good you have already taken at least one big step and hired a financial advisor. A financial advisor will take the time to understand your individual situation and create a retirement plan and investment strategy tailored to your specific needs, goals, and risk tolerance. As importantly, an advisor can help you keep your emotions and biases in check so that you stay on course.

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The Making of a Mentor

by Jane Leibbrand

When you think about the times you‘ve been able to guide someone else’s growth and development—whether it’s through a relationship with your child or a younger colleague at work—you probably recall a great sense of satisfaction. Psychologist Erik Erikson says adults in middle adulthood are engaged in the “generativity versus stagnation” stage of psychosocial development.

Generativity—leaving a lasting legacy for others who come after you—happens naturally if you’re a parent and grandparent. But it also happens when you’re contributing to benefit future generations in other ways.

Erikson says the drive to contribute to another’s positive development using the knowledge and wisdom you’ve accumulated over the years leads to successful completion of the generativity stage and the later “integrity” stage of life in later adulthood, when you look back and review your contributions. His research shows that those who don’t reach out to others and give back risk feeling disconnected and may regret missed opportunities.

The Power of Workplace Mentoring

One way we can leave a lasting legacy is by mentoring others.

Mentoring can occur in all types of environments—anytime and anywhere. Aside from the seminal task of parenting, workplace mentoring can help fulfill Erikson’s generativity task during middle adulthood. Workplace mentoring programs may sustain and improve companies, in part, by powerful effects on both mentor and mentee. For those in retirement, post-career mentoring can lead you in new directions for a more satisfying next chapter.

Mentoring has many other positive attributes that impact the bottom line. Studies show that mentoring programs help companies recruit quality candidates, increase employee engagement, and boost job retention. When an employee has a mentor, he or she is less likely to be looking at other job options.

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Companies are eager to transmit knowledge from experienced workers to new hires. By teaching young employees about the successes and failures that they have experienced, mentors play a vital role in the making of future leaders. Most C-suite executives—75 percent—say that mentoring helped to propel them to leadership positions.1

Mentoring programs also help increase diversity. Research shows that when managers are paired with mentees of a different race or gender,

getting to know the person helps break down stereotypes or bias; the mentor becomes a champion of the mentee through the new relationship.

Those are several good reasons that more than 70 percent of Fortune 500 companies have some variation of a mentoring program, and about 25 percent of small companies do, too.2 Experts say there’s no one best mentoring program; the goals of the company, the culture, and even new technologies, all help shape different types of mentoring approaches.

BUSINESS MENTORING OPPORTUNITIES If you're interested in sharing your experience with a mentee, you may find business mentoring to be a good fit for you.

Essential Advice for Mentors Top corporate mentoring programs don’t get that way by accident; sponsoring companies evaluate their programs and listen to feedback.

First Round, a venture capital firm that creates initial stage funding of tech companies, issued a call for mentees and mentors and received an overwhelming response from both.

The company structured its mentoring approach so that each mentormentee pair met every other week for one quarter. The mentees developed an agenda and shared it prior to their meetings, and First Round surveyed how mentees were applying their learning—all good workplace mentoring practices.

First Round then evaluated 100 matches to find what qualities make the most successful mentor-mentee matches and distilled the knowledge into a piece titled “We Studied 100 Mentor-Mentee Matches—Here’s What Makes Mentorship Work.” Here is what they found: • It’s not just business. Successful mentor-mentee pairs use their time together to form personal connections. Find out who each other is outside of work. Ask about favorite activities, hopes and dreams, and family. This forms the beginnings of real relationships.

• Transparency and self-disclosure. A seminal piece of advice for mentors is to be transparent. When you share a story about a time a project didn’t work out the way you planned or something you regret and why, you’re showing vulnerability. Your mentee is more likely to feel that he or she can bring a problem to you without fear of criticism.

• The ability to listen. Good mentors are also good listeners. Meet in a conference room or nearby coffee shop for more privacy. Mute your phone, and pay attention.

Think about the people in your orbit. To whom have you gone for advice? Most likely, it’s the people who sat back and listened without judgment—who didn’t jump in immediately with all the answers or counterpoints. A poetic essay by Brenda Ueland, “Tell Me More: On the Fine Art of Listening,” points out that simply being able to talk out a problem can help clarify what needs to happen next. Being heard is an important gift you can give your mentee.

SCORE | Score.org If you love sharing the lessons learned and knowledge you’ve accumulated running a business, you may find that mentoring through SCORE, the largest network of business experts volunteering as mentors in the U.S., works for you.

ACE Mentor Program | Acementor.org If your background is in architecture, construction, or engineering, you may find the ACE Mentor Program of America, Inc. (ACE) is right up your alley. By working with real professionals in their work environments, ACE students receive an invaluable hands-on education and learn to understand the day-to-day workings of a business.

MicroMentor | Micromentor.org MicroMentor is an easy-to-use social network that allows entrepreneurs and volunteer business mentors to connect so they can solve problems and build businesses together.

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Benefits for Both of You Mentoring not only aids the mentee’s growth and development, it also provides important benefits for the mentor. If your mentee is younger and recently out of school, he or she may show you the latest technology or reveal new practices in your industry.

Mentoring also has the potential to develop leadership skills. A Sun Microsystems study of employee career progress found that those who mentored others were six times more likely to be promoted than employees who didn’t mentor.3 Mentoring also has powerful psychological benefits, both in the workplace and otherwise. When mentoring, you’re giving of yourself to others and the act has a boomerang effect. When you help guide someone’s growth and development, you gain a sense of fulfillment, purpose, and achievement. Research shows that helping others can cause physiological changes in your brain related to feelings of happiness, followed by a sense of well-being, and may stimulate neurochemicals involved in experiencing a reward.

Beyond the Workplace If you’re approaching retirement, have you thought about life after you’re no longer in the 9-to-5 world? Experts say it’s important to have a plan. Going from operating on all cylinders to a full stop can lead you to question your purpose. Retirement offers tremendous freedom to make a truly meaningful impact in the lives of others.

You don’t need to be a professional expert to be a great mentor.

You just need to be able to answer basic questions or know where to find the answers.

There are a multitude of different mentoring opportunities around each and every one of us. For example, if you relate to children well, you could be a welcome addition to a mentoring program helping at-risk youth. In fact, analyses of programs mentoring at-risk youth show that children who have a consistent relationship

“

Whether you are a business professional or formerly homeless, your knowledge and life experiences can help one of our mentees make the positive changes they desire for a more successful future.

Trusted Mentor

”

with a mentor are 52 percent less likely than their peers to skip a day of school and 37 percent less likely to skip a class.4 Another option, faith-based mentoring, is very common. Also known as spiritual mentoring, it is largely about modeling a mature life built on the values of your faith and being there for the mentee when questions arise.

Athletic coaches are in an advantageous position to become mentors. A few minutes during a water break or a quick walk-up to the athlete while heading to the locker room can bring about surprising results. Players become comfortable around coaches and learn to initiate such mentoring moments on their own.

The bottom line is, mentoring opportunities are everywhere. If you’re knowledgeable about things like budgeting from paycheck to paycheck, obtaining employment or improving employment situations, improving your level of education, improving homemaking skills, or establishing a network of people who are reliable, you have plenty of valuable insight that you could pass on to another person through mentoring.

To quote the website of Trusted Mentor, a nonprofit organization in Indianapolis, Indiana, “Whether you are a business professional or formerly homeless, your knowledge and life experiences can help one of our mentees make the positive changes they desire for a more successful future.”

If you want to help an individual who is seeking to be supported by a mentor, you can visit mentoring.org and search the Mentoring Connector database for a variety of programs in your community and connect with them directly about becoming a mentor.

Mentoring can make a lasting difference in someone else’s life.

What do you want your legacy to be? Mentoring may play a central role.

George, Phil, “Your Next Must-Have Job Benefit: A Mentoring Program,” Recruiter, 2017

1

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2

“Jones, Mel, “Why Can’t Companies Get Mentorship Programs Right?” The Atlantic, 2017

3

Richards, Kelli, “The 4 Most Important Reasons You Need to Become a Mentor,” Inc., 2014

4

“Mentoring impact,” Mentor: The National Mentoring Partnership, 2019

READER Q & A

?

In this issue, we explore early retirement package offers, the difference between value and growth investing, and how to get rid of those annoying telemarketer calls.

I’ve just been offered an early retirement package.

How do I know if it’s a good deal?

A

For some, receiving an early retirement offer may be overwhelming or unexpected news, and it’s important that you not rush into a decision. Once your initial emotions settle, it’s time to assess whether to accept, decline, or perhaps negotiate the proposed offer.

But how do you know if the offer you’ve received is a good one? By evaluating it carefully to make sure that it fits your needs.

What’s the severance package? Most early retirement offers include a severance package that is based on your annual salary and years of service at the company. Make sure that the severance package will be enough for you to make the transition to the next phase of your life. You will also want to make sure that you understand the payout options available to you. Don’t underestimate your ability to negotiate. You won’t get more if you don’t ask. However, keep in mind, if hundreds of people have received the same early retirement offer, you’re less likely to be able to negotiate better terms.

Does the offer include health insurance? According to the Society for Human Resource Management, companies are evenly split on whether to continue medical coverage for terminated employees, with a slight majority (52 percent) opting to extend those benefits if the employees were enrolled prior to the termination date. If your package does not include medical coverage, look at your other health insurance options, such as COBRA, a private policy, dependent coverage through your spouse’s employersponsored plan, or an individual

health insurance policy through a health insurance exchange marketplace. Because your healthcare costs will probably increase as you age, an offer with no medical coverage may not be worth taking if these other options are unavailable or too expensive.

What other benefits are available? Some early retirement offers include employer-sponsored life insurance. This can help you meet your life insurance needs, and the coverage probably won’t cost you much. However, continued employer coverage is usually limited (e.g., one year’s coverage equal to your annual salary) or may not be offered at all. In addition, a good early retirement offer may include other perks, such as financial planning assistance or job placement assistance to help you find other employment. If you have company stock options, your employer may give you more time to exercise them.

To decide if you should accept an early retirement offer, you can’t just look at the offer itself. You have to consider your total financial picture.

Can you afford to retire early? Even if you can, will you still be able to reach all of your retirement goals? These are tough questions that a financial professional should help you sort out.

Of course, everyone’s circumstances are unique, and severance packages can create complex legal, tax, and financial questions. It’s important to work with qualified professional advisors to help figure out what is right for you before making any decisions.

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?

When it comes to investing in stocks, what is the difference between growth and value investing?

A

The terms growth and value refer to two different approaches to investing in stocks, and many investment managers focus on one style or the other. Although the goal of both strategies is often the same—to generate attractive risk-adjusted returns—the way they seek to achieve this goal differs. More than anything, it is a difference in mindset, with each style favoring certain characteristics as they scour the market for investment opportunities.

Growth investors favor stocks with the potential for future earnings growth rates that are higher than the broader market. Because higher future earnings should translate to higher future stock prices, successful growth investors are keen to understand the drivers of future growth and seek to identify companies with high growth potential before the rest of the market catches on.

Questions that a growth manager will ask of potential investments include: Will growth come from taking existing products to new markets or from the development of new products? Can the company disrupt an existing marketplace with a new technology? How sustainable is the growth, and how defensible is the company’s market position? What are the risks or threats to future growth plans? And, importantly, how much future growth is already reflected in the current stock price?

Value investors, on the other hand, look for stocks whose current prices are below their assessment of the fundamental value of the business. They believe that markets can overreact in the short term, yielding opportunities for investors to profit when stock prices return to their intrinsic values.

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Value investors seek diamonds in the rough. In other words, they are looking for businesses that have fallen out of favor or that face some sort of temporary setback, with the idea that when the market realizes the true value of that business, its stock price will appreciate, and investors will profit.

—OR—

A balanced approach

that provides investors

the potential to benefit

from both styles remains the best strategy.

The starting point of a value investor’s process is to determine the intrinsic value of a company.

Once estimated, this value can identify when that stock is selling below where it should be.

This approach often requires extensive fundamental research, financial modeling, and interviews with company management, customers, and suppliers.

As you would expect, these two styles yield portfolios that look quite different from one another. Growth strategies tend to emphasize high-growth industry sectors such as technology, health care, and consumer discretionary stocks, while value-oriented portfolios often emphasize sectors such as financials, industrials, and consumer staples.

Other differences include portfolio turnover, dividend yield, and degree of volatility relative to the market as a whole.

Finally, there is the question: Which style is better? And it may come as no surprise when we say that for most investors the answer is: both. There can be extended periods when one style outperforms the other, and it is notoriously difficult to anticipate when such transitions will occur. A balanced approach that provides investors the potential to benefit from both styles remains the best strategy.

How do I stop those annoying telemarketing calls?

A

How many times have you just sat down to dinner when the phone rings? You think the call could be important, so you pick up. But on the other end is Bill from your local cable company with a great offer for you or, equally disruptive and frustrating, it’s a robocall. If you’re like most people, you hang up or wait until Bill is finished to say, “I’m not interested.”

Luckily, AT&T, Sprint, Verizon, and nine other telecommunications companies have teamed up with attorneys general of all 50 states, plus the District of Columbia, to announce a new pact to eradicate illegal robocalls. According to National Public Radio, included in the deal is call-blocking technology that will be integrated into phone networks’ existing infrastructure at no additional charge to customers.

However, if you want telemarketers to stop calling you, you need to say that.

Once you tell a telemarketing firm to put you on its do-not-call list, it is required by law to do so. If a telemarketing company continues to call, you may be able to take that firm to court. If you find yourself in this situation, be sure to document the calls—dates, times, company name, the caller’s name—and consult an attorney for more information.

A better way to end telemarketing calls is to sign up for the National Do Not Call Registry. This free federal service, managed by the Federal Trade Commission, makes it illegal for telemarketers to call you once your number is included on the registry. To sign up, visit donotcall.gov or call 888.382.1222.

If you want telemarketers to stop calling you, you need to say that.

Once you tell a telemarketing firm to put you on its do-not-call list, it is required by law to do so.

Although you should receive far fewer dinnertime calls once you’ve signed up for the national registry, don’t expect telemarketing calls to end completely.

Because certain calls don’t fall under federal rules, you may continue to receive calls from companies with which you have an established business relationship— from charities or political organizations soliciting donations—or from companies doing phone surveys. To end these calls, you’ll have to ask these callers, one by one, to put you on their organization’s do-not-call list.

If you have a question for the VESTED team, we’d love to hear from you and see if we can help. Please send your questions to us at VESTEDmagazine@captrust.com.

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GIVING BACK CAPTRUST colleagues from around the country participated in a host of volunteer opportunities over the last several months. Employees gave their time, energy, and brute strength to enrich lives in the communities we serve.

2019 Hops for Hope

9/11 Day of Service

Volunteer Spotlight

• Carolina Tiger Rescue, Pittsboro, North Carolina • Camp Mary Atkinson - Girl Scouts of NC Coastal Pines, Raleigh, North Carolina • Children’s Home Network, Tampa, Florida • Crisis Assistance Ministry, Charlotte, North Carolina • Diaper Bank of NC, Durham, North Carolina • Feeding America Southwest Virginia, Salem, Virginia • Holy Trinity Presbyterian Church, Tampa, Florida • Hope Reins, Raleigh, North Carolina • Inter-Faith Food Shuttle Camden Street Learning Garden, Raleigh, North Carolina • Inter-Faith Food Shuttle Farm, Raleigh, North Carolina • Inter-Faith Food Shuttle Grocery Bags for Seniors, Raleigh, North Carolina • Metropolitan Ministries, Tampa, Florida

For a fifth year, CAPTRUST participated in Triangle Hops for Hope. The event raised more than $160,000 to benefit Children’s Flight of Hope, a local nonprofit that provides air transportation for children to access specialized medical care. CAPTRUST’s team, The Roth IPAs, brewed a Berliner weisse named Tiki Trashcan, raised $3,719 for the cause, and came in second place in the Critics’ Choice Award competition.

From Olympics to lions and breakfast to books, CAPTRUST colleagues were busy this past summer, giving their time and energy to enrich lives in the communities where we do business.

Volunteers put time in to further the good work of more than 20 programs and organizations that are making a difference.

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Fall | 2019

On September 11, CAPTRUST colleagues were out in force to volunteer their time and energy for the good of the Raleigh community. Volunteers logged hours at the diaper bank, sorting and packaging diapers to be distributed to underserved families.

Another group of volunteers gave a hand at the Habitat for Humanity ReStore, helping to bring in heavy deliveries, organize donations, and get items ready for sale.

Bond Brothers 5K

On September 28, the CAPTRUST Community Foundation partnered with Bond Brothers Beer Company to host the third annual Bond Brothers 5K race in Cary, North Carolina. The event included a hilly 5-kilometer circuit around downtown Cary and a block party at the brewery. The race attracted 575 runners and raised more than $20,000.

• Murphy Games, Tampa, Florida • Note in the Pocket, Raleigh, North Carolina • Piedmont Farm Animal Refuge, Pittsboro, North Carolina • Ronald McDonald House Charities®, Atlanta, Georgia • Special Olympics, Morrisville, North Carolina • Triangle Land Conservancy, Durham, North Carolina • The Food Bank of Eastern Michigan, Clarkston, Michigan • Valley Youth House - Camp Fowler, Orefield, Pennsylvania • Walk MS: Twin Cities, Minneapolis, Minnesota • YMCA Y Readers Program, Charlotte, North Carolina

San Antonio, TX

CAPTRUST GROWTH We are pleased to announce two new regional offices, two new financial advisors, and several key hires, including a new chief financial officer.

Kelly Mills

Kelly Mills joined CAPTRUST in July as the firm’s chief financial officer. She is charged with overseeing all accounting and financial reporting matters for the firm. Prior to joining CAPTRUST, Kelly was chief financial officer and principal for Fiduciary Network. She received her Bachelor of Business Administration degree from Texas Tech University and her Master of Science degree in accounting, auditing, and financial reporting from Texas Tech University’s Rawls College of Business.

Frank Bub

In August, Frank Bub joined CAPTRUST as a senior director in the firm’s wealth management business. His more than 25 years of experience working with independent investment advisors will come in handy as he focuses on wealth management sales and growth initiatives for the firm. Prior to joining CAPTRUST, he was director and eastern head of relationship management and consulting at BNY Mellon’s Pershing Advisor Solutions.

Kelly Gilbert

As an institutional client services manager in CAPTRUST’s Business Operations Group, Kelly Gilbert oversees a team of client management consultants who support the firm’s institutional financial advisors. She earned her Bachelor of Science degree in biology from Eckerd College and her Master of Business Administration, Global Management degree from the University of Phoenix.

Jennifer Cunningham

Jennifer Cunningham joined CAPTRUST in August as a senior manager leading the firm’s integrations. She is charged with management of the onboarding process for the firm’s new advisors and their clients. Prior to joining CAPTRUST, Jennifer worked as a vice president in the field services and operations area of First Citizens Wealth Management and Investor Services.

New Office in Green, Ohio In June, CAPTRUST announced the addition of Cornerstone Capital Advisors to its growing wealth management business. Led by Mario Giganti, the highly credentialed and experienced Green, Ohio-based team oversees $770 million of client assets. They use a goal-based financial planning process to help individuals and families and serve as a personal financial resource for high-income professionals and entrepreneurs. In addition, their fiduciary services team assists businesses and nonprofits with their retirement plans and endowments.

The Green, Ohio, team includes: • Amanda Bernier • Nathan Bopp • Scott Cooper • Mark W. Fearigo • Mario Giganti • Glen Hahlen

• Daniel R. Harsh • Lisa Hay • T. Grey Kennedy • Jared A. Milhoan • Mark Muntean • Kevin Spray

Six New Offices in Texas In September, South Texas Money Management (STMM) joined the CAPTRUST family. Headquartered in San Antonio with additional offices in Austin, Brenham, Corpus Christi, Dallas, and Houston, they specialize in providing investment advisory services to individuals, trusts, estates, defined benefit plans, institutions, foundations, and endowments.

The STMM team brings $3.7 billion of client assets to CAPTRUST along with 17 new financial advisors: • Heather Ford Caussade • Kim Cornwell • Lisa Fox • Julia Gavrilov • Lisa Gostkowski • Mary Hartman Hime • Lance Lahourcade • Christina K. Lecholop • Madelon Yanta Leone

• Lisa Ivie Miller • David W. Mize • Holly Moore • Donna Patterson • Cathy Ritter • Michelle Scarver • David Stix • Sherry Thiltgen

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CAPTRUST GROWTH We are excited to share two notable financial advisor hires.

Catherine Ellis

Catherine Ellis joined CAPTRUST’s Austin, Texas, office as a financial advisor responsible for providing investment advisory services to fiduciaries of corporate retirement plans.

Catherine served as a vice president, regional retirement consultant for American Century Investments prior to joining CAPTRUST. She received her Bachelor of Business Administration degree from Missouri Western State University.

Mike Planning

Mike Planning joined the firm in August as a financial advisor working in our Greensboro, North Carolina, office. His responsibilities include helping retirees and soon-to-be retired clients build their plans for the future, including Social Security strategies, income tax planning, portfolio construction, and cash flow generation. Prior to joining CAPTRUST, he worked as a financial advisor associate with Stifel Nicolaus. Mike received a Bachelor of Science degree in finance and marketing from La Salle University.

CAPTRUST RECOGNITION CAPTRUST Ranks No. 1 (Again)

The July 2019 issue of Financial Advisor magazine ranked CAPTRUST number one among registered investment advisors with assets of more than $1 billion, making it the firm’s fourth year running to achieve this distinction. The magazine’s annual survey analyzes several metrics, including assets under advisement, asset growth over the trailing year, and assets per client, as well as other indicators of business success.

Curry Wins C-Suite Award

The Triangle Business Journal recognized CAPTRUST Chief Marketing Officer John Curry as one of its outstanding business leaders at its 2019 C-Suite Awards luncheon held in August at Prestonwood Country Club in Cary, North Carolina.

The C-Suite Awards identify and honor the region’s outstanding corporate leaders for their contributions to the Triangle community and the significant impacts they make toward the success of their respective organizations.

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Fall | 2019

TBJ’s Best Places to Work

The Triangle Business Journal again named CAPTRUST to its Best Places to Work list. This is the sixth year CAPTRUST has received this honor. A group of CAPTRUST dignitaries learned that the firm placed No. 2 among extra-large companies in the Triangle at an awards luncheon hosted at Raleigh Improv in Cary, North Carolina, on September 12. Businesses on the list are scored and ranked based on the results of a survey voluntarily completed by employees.

VESTED Symposium CAPTRUST hosted its first VESTED Symposium at the Contemporary Art Museum in Raleigh, North Carolina, on September 5. The event included a talk from keynote speaker Barbara Bradley Hagerty, an award-winning journalist and the author of New York Times best-selling Fingerprints of God and Life Reimagined. CAPTRUST Chief Investment Officer Kevin Barry closed out the evening with a downto-earth take on the current investment landscape, followed by questions from the audience.

InvestmentNews Names Miller as Financial Planning Industry Leader

In September, InvestmentNews recognized the 50th anniversary of financial planning by honoring a distinguished group of individuals widely viewed as movers and shakers in the industry who have helped shape the financial planning landscape through their ideas and actions.

We are proud to share that CAPTRUST Chief Executive Officer Fielding Miller was included in this very impressive list of 20 major contributors in the financial planning industry.

Excellence Award Winners The Excellence Award is a way for CAPTRUST associates to recognize co-workers who go above and beyond and consistently perform at the highest levels. The award winners represent an elite group whose attitudes and performance have positively impacted CAPTRUST’s clients and the company. The following are the Excellence Award winners for the second quarter of 2019.

James Stenstrom James’ can-do attitude is a great example of living the CAPTRUST mission. His leadership capabilities and willingness to offer assistance to colleagues positioned him as a natural choice for this special recognition.

Ashley May Ashley is an active student of the game and has mastered her role at CAPTRUST. Ashley’s peers recognized her for consistently going beyond her normal job functions to keep the Tampa office engaged with the local community. Her commitment to deliver the best to our clients, colleagues, and communities is evident in all she does.

New Website Launch In July, we launched a refreshed website with the help of design firm Skookum. The new captrust.com boasts enhanced navigation, an updated look and feel, easy access to news and resources, and sitewide search capabilities. Before year-end, we will be launching a dedicated spot on captrust.com for VESTED, featuring articles from the latest issue, a searchable article and video archive, and a flip-book for easier reading.

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We know that investors are looking for experienced and trusted advisors who can provide wealth management services that are focused on their unique circumstances and tailored to their goals.

In more than 30 years of acting as a fiduciary to some of the country’s biggest retirement plans, we have gained valuable insights that we can apply to your wealth planning and investment challenges.

Ted Lew, CFP® Vice President, Financial Advisor San Ramon, CA Mark Miller Senior Vice President, Financial Advisor San Ramon, CA Dave Fernandez, CFA® CFP® Vice President, Financial Advisor San Ramon, CA

captrust.com • 919.870.6822 | toll free: 800.216.0645 • 4208 Six Forks Road, Suite 1700 | Raleigh, NC 27609