Somerset Wealth Strategies

Our Philosophy

Our philosophy is simple, though it's a radical departure from most financial planning:

  1. Reduce Risk to Maximize Returns
  2. Secure Downside Protection For Our Client's Money
  3. Use Insurances, Rather than Simply Promising Assurances
  4. Only Create & Recommend "Relative" Plans

We cannot continue doing business the way most advisors have in the past, e.g. taking significant risks without adequate protection. We further understand that investors cannot afford another 10-year period like the last -- and that’s exactly why we'll keep doing things exactly as we have for the past 20 years.

We'll continue to create plans designed to protect our clients, knowing they do not have the time, energy, or money to remake what they’ve lost. They need to be protected while at the same time stay ahead of inflation and enjoy their retirement through financial independence.

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Reduce Risk

You hear it constantly: “If you want higher returns, you must tolerate higher risk.” Translate and examine that advice: If you want to increase your chance of winning, you must increase your chance of losing. Put that one right at the top of the list of things that make you go “hmmm…”

That isn’t investing; it’s gambling. And that bizarre philosophy may prevent millions of Americans from retiring when and how they’d like to. Furthermore, even those fortunate enough to retire worry that they won’t be able to stay retired.

With more than 67 years of combined experience, our team has handled the plans, goals, and dreams of thousands of clients.

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Downside Protection: It's Just Common Sense

How responsible and wise would it be to drive around a track in a car at 200 miles per hour without a helmet, roll cage, seatbelt, or any other form of protection? Sounds crazy, right? Well then why do we think it’s a good idea to put hard-earned money into equities without some form of downside protection?

Prospectuses clearly state that you can lose everything you invest and there are no guarantees. Somehow we’ve been brainwashed to believe that this is acceptable business practice. And, of course, when you do lose your money in the market, what do most advisors tell you? “You’re in it for the long haul.”

Many investors have swallowed these clichés hook, line, and sinker because they trusted and believed their advisors.

Insurance companies offer excellent products that protect their clients’ downside. Unfortunately, many investors have been unaware of these products. And if they have known about them, they may have been told they were too expensive and too illiquid. That’s a shame, and millions of Americans simply don’t know the truth about these investments.

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Insurances Versus Assurances

Understanding the massive risks involved in the equities market, don’t you think that it would make perfect sense to design products that can participate in the upside of the markets but also protect against the downside? These products do exist, but many advisors either don’t know about them or they have misconceptions about them.

So these advisors give you assurances, while still exposing you to market risk: “I’m going to take great care of you.” “I’ll be there for you no matter what happens.” “I monitor your portfolio carefully.”

Those are probably things you want to hear from your advisor. Unfortunately, such assurances aren’t worth the money they’re printed on—even if they come from ethical, trustworthy people. It doesn't matter how much integrity your advisor has—no one can predict market behavior. Our economy is far too complex and globally-interconnected to rely on lip service from well-meaning advisors.

This is why we believe in insurances. We use financial products, such as fixed annuities, that insure buyer’s against the risk of loss. We can offer assurances, but only because our clients are insured with guarantees in the most competitive products backed by the strongest insurance companies in the nation.

When things don’t work out as hoped for and anticipated, the full claims paying ability of these companies acts as a backstop for our clients’ money.

Interestingly, many people are immediately suspicious of insurance-based accumulation vehicles. It’s usually because they think they have too many fees. But these same people carry insurance on their homes, cars, and boats. They have health and life insurance. Furthermore, they understand that if these and other vital things aren’t insured, they’re being negligent and short-sighted.

Why is it such a foreign concept to insure your retirement nest egg—potentially your greatest asset—when you insure everything else?

With the right products, we can show anyone how to pay for insurance on the investments within your retirement portfolio.

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Relative Plans

A simple way to describe what you should look for in a financial advisor is those who only offer “relative” plans. By that we mean plans that most representatives would only sell to their relatives. If you recommend a stock to your aunt and it tanks, how eager are you to see her at the next family reunion?

We use the “relative plans” as a guideline because you can’t escape family. And if we feel there’s the slightest chance we’ll want to avoid anyone after giving them financial advice, we won’t offer it. We only give recommendations that we would feel completely comfortable giving to our own mothers.

Furthermore, we back those up with long-term guidance—just as we would for our closest family members.

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