The Life Planning 101 Podcast

Faith Over Fear

This week, Angela discusses the current financial market volatility in April 2025, emphasizing the theme 'Faith Over Fear.' She explores how investors can navigate uncertainty by understanding the nature of investing, the composition of financial markets, and the importance of having a solid financial plan.
Key Takeaways 💡
The current financial markets are experiencing significant volatility due to factors like tariffs, interest rates, and political noise, which understandably creates fear among investors. However, such turbulence is part of the economic cycle, and historically, crises have presented investment opportunities rather than just risks. Angela cautions against simply hiding from the market and encourages looking for opportunities amid the chaos.
Investing is fundamentally about the future—whether five, ten, or thirty years ahead—and requires a belief that the world will continue to advance with new technologies, efficiencies, and comforts. Without faith in a stable and growing future, investing loses its purpose. Angela urges listeners to consider their long-term outlook on the world and economy as a foundational step in overcoming fear.
The financial markets are not just abstract numbers or symbols on Wall Street; they represent real companies producing everyday goods and services that people rely on, such as toothpaste, clothing, and transportation. These businesses operate under supply and demand principles similar to local businesses, and their success depends on meeting consumer needs despite market noise or political disruptions. Understanding this can help investors see beyond market volatility to the underlying economic realities.
Much of the fear in the markets stems from uncertainty about whether investments will meet current and future financial needs, often due to a lack of a clear financial plan or insufficient cash reserves. Angela stresses the importance of 'cash confidence'—having enough liquid assets to weather market downturns without panic. She advises listeners to develop a plan that buckets cash appropriately to maintain stability and take advantage of market opportunities when they arise.
Emotions, especially fear, can undermine even the best investment strategies and analytics. While data and expert management are critical, they are insufficient if fear causes poor decision-making. Angela encourages investors to have faith in their future outlook, understand the business sense behind investments, and maintain a comprehensive plan that aligns with market opportunities. This mindset allows investors to act confidently rather than react fearfully during market volatility.

The Griever's To-Do List (Rebroadcast)

This episode focuses on the importance of life planning to prepare for unforeseen circumstances like illness or death. Through the story of Maria and her husband Tom, the episode highlights the emotional, financial, and logistical challenges faced by families without proper planning.
Key Takeaways 💡
The episode emphasizes the importance of taking action to prepare for unforeseen life events, such as illness or death, to reduce the burden on loved ones. Angela encourages listeners to reflect on their responsibilities and take proactive steps to care for their families.
Maria's story illustrates the challenges of navigating life after her husband Tom suffered a severe stroke, which left him physically impaired and behaviorally changed. Their retirement dreams were disrupted, and Maria had to manage alone, highlighting the unpredictability of life.
Maria faced a steep learning curve in managing financial and estate matters after Tom's passing, despite having a financial cushion from selling their business. This underscores the need for a comprehensive retirement and estate plan.
The episode discusses the limitations of Medicare and health insurance, which often do not cover long-term care needs. Maria had to navigate the complexities of Medicare, Medicaid, and out-of-pocket expenses during a health crisis.
Financial planning challenges included managing the proceeds from their business sale, understanding tax implications, and dealing with inflation's impact on savings. Maria also had to make difficult decisions about social security and her late husband's belongings.
The emotional and logistical burden of funeral planning and addressing her own future needs led Maria to realize the importance of having a plan in place. The episode stresses that planning is a gift that provides peace and allows survivors to thrive.
Angela encourages listeners to consider what should be on their 'griever's to-do list' to avoid placing unnecessary burdens on family members during difficult times. Proactive planning can ease the challenges faced by survivors.

This Week in the Market - Episode 74 (4/11/25)

About the Podcast 🎙
This episode discusses recent market volatility, interest rate changes, and their implications on investments and global markets. The KFS Team analyzes historical market patterns, the role of the Federal Reserve, and the impact of political and economic factors on market behavior.
Key Takeaways 💡
The 10-year Treasury yield has risen to 4.5%, marking a significant increase and causing ripple effects across other asset classes. Such large percentage moves in interest rates are uncommon and have led to shifts in the bond market and investor behavior.
During COVID, the Federal Reserve intervened by purchasing bonds to stabilize prices and lower yields. In contrast, the current rise in yields is driven by significant selling, highlighting a shift in market dynamics.
The unwinding of the basis trade, where hedge funds buy treasuries and sell futures, has caused massive financial movements, raising concerns about further market instability.
China's potential selling of treasuries could destabilize its currency and have broader implications for global markets, adding to the uncertainty.
Historical data shows that significant declines in the S&P 500, such as the recent 12.1% drop, often lead to substantial gains in the following year, with an average return of 32.5%. This pattern suggests potential for recovery despite current volatility.
The volatility index (VIX) is a key measure of market uncertainty, with spikes often followed by market recoveries. Trading during volatile periods becomes more expensive due to wider spreads and increased costs.
Retail investors tend to react emotionally during market downturns, while institutional investors adopt more strategic approaches. This difference in behavior influences market dynamics.
Interest rates play a critical role in market behavior, with lower rates encouraging investment and leveraging. However, the Federal Reserve has indicated it does not plan to lower rates despite global trends.
The Bloomberg Financial Conditions Index has shifted from expansion to contraction, reflecting tighter financial conditions. The Federal Reserve's delayed response to these changes has raised concerns about potential liquidity crises.
Despite recent market volatility, there is optimism about future recovery and significant investment opportunities. Patience and a proactive approach are encouraged, as upcoming earnings reports may provide positive signals.

Finding Peace in Turbulent Times (Rebroadcast)

The water in life gets rough from time to time. When we take our eyes off of the horizon, we tend to suffer. And like being sea sick, you may feel that you probably aren’t going to recover until your feet hit dry land. This week we share some tips to help you find peace during turbulent times.

This Week in the Market - Episode 73 (4/4/25)

Got a few minutes? This week Aaron, Sam, Brent, and Henry talk about what's going on in the market, tariffs, interest rates, and more.

Paralyzed by Estate Planning

This episode focuses on estate and legacy planning. Angela discusses the challenges of estate planning, including procrastination and complexity, and provides actionable steps to simplify the process using a structured approach.
Key Takeaways 💡
Angela highlights that 68% of Americans lack a valid Will, with procrastination being a major factor, especially among those earning over $80,000 annually. She emphasizes the importance of addressing this issue to avoid leaving loved ones unprepared.
The concept of a legacy planning process is introduced to help individuals navigate the complexities of estate planning. Angela stresses that taking the first step and engaging actively in the process is key to overcoming procrastination.
Angela presents the acronym W.W.T.C. (Who Gets What, When, and Under What Terms and Conditions) as a simple framework for estate planning. She encourages listeners to jot down their thoughts without overthinking to make the process less intimidating.
Listeners are advised to start estate planning by identifying 'who' they want to include in their estate.
The next step is determining 'what' each person or cause will receive. Angela advises being specific about allocations without worrying about equal distribution at this stage.
Angela discusses the importance of deciding 'when' beneficiaries will have access to their inheritance, distinguishing between access and outright ownership. She also addresses common fears about how beneficiaries might use their inheritance.
The 'terms and conditions' for each beneficiary are explored, with Angela acknowledging that family dynamics can complicate these decisions. She encourages listeners to document their concerns and wishes to ensure clarity.
Angela shares a story about Sister Mary to illustrate the importance of taking action in estate planning, even if the approach is unconventional. This underscores the need to prioritize planning to avoid future complications.
The episode concludes with Angela emphasizing that estate planning is an act of love for those left behind. She encourages listeners to use the provided tools to ensure their wishes are honored and family conflicts are minimized.

This Week in the Market - Episode 72 (3/28/25)

This episode delves into financial topics such as market volatility, private investments, and portfolio diversification. Aaron, Sam, Brent, and Henry discuss current market conditions, inflation, private equity, and debt, offering insights into investment strategies and opportunities in private markets.
Key Takeaways 💡
The market has experienced significant volatility, with short-term interest rates fluctuating and inflation readings showing a month-over-month increase of 0.3%. Despite these numbers, everyday costs for essentials like food and fuel remain high, creating a disconnect between market reactions and public sentiment.
Volatility in the market can present buying opportunities, and hedge funds often benefit from such conditions by accessing diverse asset classes that perform well during turbulence.
Private companies vastly outnumber public ones, with the private market valued at $11 trillion compared to the $88 trillion public market cap. This disparity highlights the growth potential in private markets.
Private equity and debt offer companies alternatives to traditional bank loans, especially as post-2008 regulations have made banks less willing to lend to large companies. Investment firms have stepped in to fill this gap.
Private debt markets are described as less risky than equities, with lenders conducting thorough analyses to ensure loan security. Returns in private debt markets can range from 12-14%, with companies using these funds for growth rather than survival.
Private investments often require a higher level of sophistication or assets due to liquidity challenges and high barriers to entry. Investors must adhere to the company's schedule for accessing funds, aligning their interests with investment managers.
Diversification in portfolio construction is crucial, as different asset classes perform variably, smoothing out overall returns and reducing volatility. Private markets often offer higher yields compared to public markets, but at the cost of liquidity.
Investors should limit illiquid assets to around 5% of their portfolio, aligning investments with their liquidity needs and life planning goals. Longer-term investments can yield better compounding returns.

No Time to Die (Rebroadcast)

Like the title of a James Bond movie, we live in a day and age where it can seem like there is no time to die. There seems to be so many obligations that need our attention. Do you care about your family? Then you don’t want to miss this week’s episode of Life Planning 101.

This Week in the Market - Episode 71 (3/21/25)

Aaron Kennedy is joined by Sam Barker, Brent Bible, and Henry Knowles this week to talk about interest rates, market performance, international investments, and investment strategies. The team provides insights into current market conditions, the importance of diversification, and lessons from past investment decisions.
Key Takeaways 💡
Interest rates are currently inverted, with shorter-term treasuries offering better returns than longer-term ones. Higher rates reduce the present value of future income, and a decrease in rates could improve mortgage payments and economic conditions.
International markets are outperforming US markets this year, with European indices like the FTSE and DAX showing significant gains. International markets also have lower price-to-earnings (PE) ratios, making them more attractive to investors compared to the US market.
The US market's concentration in top-performing stocks, such as Microsoft and Amazon, has led to challenges for diversified portfolios. The top 10 stocks in the S&P 500 are significantly overvalued compared to historical averages.
Fixed income investments, while less exciting than stocks, play a crucial role in portfolios, especially during market downturns. The team emphasizes the importance of recognizing buying opportunities during market dips and maintaining a forward-looking mindset.
Market downturns should be viewed as opportunities rather than threats. The team encourages proactive investment during dips, as these moments can provide a competitive edge and align with the human desire for progress and improvement.
The team reflects on past investment decisions, particularly with FICO, a company with strong financial performance but a high PE ratio. They highlight that high-quality companies can justify higher valuations and express regret for not investing earlier.
FICO's share buyback strategy has increased the value of remaining shares for existing shareholders. The team emphasizes the importance of management's confidence in their company's future, even at high valuations.
The team references Warren Buffett's investment philosophy, which evolved from focusing on undervalued companies to prioritizing quality companies at fair prices. They compare FICO's situation to Amazon's past, where high PE ratios were justified by consistent growth.

Why Every Business Owner Needs an Exit Plan

This episode features Rich Hall, a certified exit planning advisor, discussing the importance of preparing businesses for sale. The conversation focuses on the challenges business owners face when selling their companies, the need for proper exit planning, and strategies to ensure a successful transition while aligning with personal and financial goals.
Key Takeaways 💡
A significant portion of business owners' wealth (80%) is tied up in their businesses, yet only about 10% have a formal exit strategy. This lack of planning can lead to financial risks and missed opportunities when attempting to sell.
Many business owners overvalue their companies, viewing them as personal investments rather than marketable assets. This often results in unrealistic expectations and challenges during the sale process.
The value of a business is determined by how easily it can be transferred to a buyer. Businesses that are too dependent on the owner or a few key clients are less attractive to potential buyers.
Only 30% of businesses listed for sale actually sell, and many owners attempt to sell too late, often due to burnout. Proper planning and preparation are essential to increase the chances of a successful sale.
Over half of business exits occur involuntarily due to unforeseen events like death, disease, divorce, disagreements, or distress. Advance planning can help ensure the business continues to operate under such circumstances.
A significant number of business owners (75%) regret selling their businesses within the first year, often due to inadequate financial planning or a lack of purpose post-sale. It's crucial to plan for life after selling to avoid this regret.
Exit planning involves aligning the business's value with the owner's personal and financial goals, while also considering legacy and financial outcomes. Ideally, this process should start 2-3 years before the intended sale.
Businesses that are income-based rather than value-based often struggle to sell, even with strong financials. Owners should focus on making their companies less dependent on themselves and diversifying their client base to enhance attractiveness to buyers.
Living a purpose-filled life post-retirement is essential, as many business owners struggle to find fulfillment after the initial excitement of retirement fades. Planning for a meaningful life after selling is as important as the sale itself.
Business owners should prioritize family and faith, as time spent with loved ones is irreplaceable. Living life intentionally rather than by default is a key takeaway from the discussion.

This Week in the Market - Episode 70 (3/14/25)

Aaron Kennedy is joined by Sam Barker, Brent Bible, and Henry Knowles this week to talk a little about the markets, interest rates, what they're looking at right now, and more. You don't want to miss this. Do you have questions or suggestions for future episodes? Feel free to reach out to us at: www.kennedy-financial.com.

What Isn't New in D.C.?

This week, Angela discusses key financial and legislative updates, including the Corporate Transparency Act, Social Security Fairness Act, Secure Act 2.0, the impact of executive orders on financial markets, and more.
 
Key Takeaways 💡
The Corporate Transparency Act, though not currently enforced, could impose significant fines and prison time for non-compliance. A new rule is expected by March 21st, and Congress is discussing potential changes or elimination of the act, which could benefit businesses.
The Social Security Fairness Act addresses unfair provisions like the windfall elimination provision and government pension offset, benefiting 3.2 million people retroactively from January 2024. Listeners are encouraged to check their eligibility for potential benefits.
The Secure Act 2.0 introduces automatic enrollment in retirement plans and increased catch-up contributions for employees aged 60-62, effective in 2025. These changes provide an opportunity to maximize retirement savings.
Executive orders are creating uncertainty in financial markets, with reactions depending on whether policies are pro-business. Angela emphasizes the importance of seeking opportunities amidst the chaos and adapting to the evolving landscape.
The Tax Cuts and Jobs Act of 2017 faces slow progress for extension in Congress due to political strategies and reconciliation bill complications. Angela highlights the implications for business deductions, tax brackets, and the challenges of balancing the budget.
Angela stresses the urgency of addressing the debt ceiling and the limited timeframe Congress has to achieve proposed goals. It's important to stay informed about tax cuts and legislative changes through reliable resources.
Listeners are urged to adapt to inevitable changes and find growth opportunities, quoting Jack Canfield. Proactive planning is recommended to navigate the ongoing changes from Washington.