by Frazer Rice
Measure the success of your portfolio by measuring its performance after taxes, fees, inflation, and your spending needs. Many people understand the impact of taxes and fees, but it’s much less common for people to realize that your portfolio needs to outperform your spending and the seemingly invisible costs of inflation. Not every investment needs to be a home run. However, your investments need to contribute to your portfolio in a way that helps you achieve your goals from a holistic perspective.
For example, you may have an allocation to cash, which would not outperform inflation or spending but has the important feature of liquidity. That cash allocation may represent safety or the preservation of funds for your needs. It may help you to sleep well at night. As long as that allocation to cash is considered in the broader context of your total assets and their ability to help you achieve your goals, you are making an intelligent decision for your future and your legacy.
Next Steps
The biggest obstacle in wealth planning is the reluctance to begin, and the toughest step to take is the first one. You’ve got to take that first step.
Think about the future and where you fit into it. Do you have the resources to live the life you want? How do you want to provide for your family? How do you want your business to be passed on? How do you want to improve your community (or the world)? How do you want to impact society with your resources? How do you want to be thought of?
These are emotional, complicated concepts, and few people have experience in this area themselves. Thinking ahead about these issues will make the process of planning for the future easier.
It’s okay to ask for help. It’s not okay to weather this storm in silence, or assume it will take care of itself. You’ll need to be willing to receive assistance and advice from experts who work in wealth management every day. The advisors who will help you achieve your goals are out there. You should start having conversations now, to know which people you’ll select for the advisor cabinet that will help you achieve your goals.
Even after hearing all of this, don’t panic! In the complex and changing world of wealth management, nobody can do everything on their own. The most intelligent decision-making around wealth usually starts with the ability to listen to experts who have experience helping other wealthy families. I’ve put my thoughts and experiences down on paper (or pixels) with the goal of arming you with a resource to begin your journey.
Thank you for reading this book, and I hope my years of experience in law, government, philanthropy, and wealth management have been a helpful resource for you. To loosely quote the esteemed world leader David Lee Roth: If you liked this, please tell a friend. If you didn’t like this, please tell two enemies.
If you have additional questions about any topics discussed in this book, or questions regarding your own planning, please reach out to me anytime at www.FrazerRice.com. I’m happy to help you reach your goals in any way I can.
Appendix
Supplemental Reading List
Investing
The Intelligent Investor, Benjamin Graham and Jason Zweig
Incredible Shrinking Alpha, Larry E. Swedroe and Andrew L. Berkin
The Little Book of Common Sense Investing, John C. Bogle
One Up on Wall Street, Peter Lynch
The Handbook of Fixed Income Securities, Frank J. Fabozzi and Steven V. Mann
Getting Started in Asset Allocation, Bill Bresnan and Eric Gelb
The Success Equation: Untangling Skill and Luck in Business, Sports, and Investing, Michael J. Mauboussin
Estate Planning and Structuring
The Wall Street Journal Complete Estate Planning Guide Book, Rachel Emma Silverman
Strictly Business: Planning Strategies for Privately Owned Businesses, David K. Cahoone and Larry W. Gibbs
The Family Office Book, Richard C. Wilson
Family Dynamics
Family Wealth—Keeping It in the Family: How Family Members and Their Advisers Preserve Human, Intellectual, and Financial Assets for Generations, James E. Hughes Jr.
The Protestant Work Ethic and the Spirit of Capitalism, Max Weber
Human Capital, Gary S. Becker
Inside Information on Wall Street
Liar’s Poker, Michael Lewis
The Big Short, Michael Lewis
Backstage Wall Street, Joshua M. Brown
Take on the Street, Arthur Levitt
The Sellout, Charles Gasparino
No One Would Listen, Harry Markopolos
Disrupted: My Misadventure in the Start-Up Bubble, by Dan Lyons
Humor
Class: A Guide through the American Status System, Paul Fussell
The Official Preppy Handbook, Lisa Birnbach
The Dilbert Principle, Scott Adams
Adventures in Retirement, Lawrence G. Doyle
Rules for Modern Life, Sir David Tang
Thought-Provoking
Freakonomics, Steven Levitt and Stephen Dubner
Choose Yourself, James Altucher
Zero to One: Notes on Startups, or How to Build the Future, Peter Thiel
Trust Me, I’m Lying: Confessions of a Media Manipulator, Ryan Holiday
The Four: The Hidden DNA of Amazon, Apple, Facebook, and Google, Scott Galloway
Acknowledgments
I would like to express my gratitude to all the people who supported me in writing this book. In particular, I’d like to thank Mom, Dad, Alex, Nick, and ML McCarthy for their unconditional support. This process has taught me that writing, like baseball, involves a lot of individual effort but is ultimately a team sport. If I list all of the family, friends, and colleagues who endure my mental wanderlust, I could fill another twenty pages. My thanks to all of them.
Next, I’d like to thank Brad Kauffman, who spent many hours listening to and organizing my thoughts. It’s no small feat separating the signal from my noise. Additionally, I thank John Vercher, Elizabeth de Cleyre, Barbara Boyd, Zach Obront, Tucker Max, and the rest of the crew at Lioncrest for their help and contributions to this process. It’s a lot of fun to be able to conquer a personal Everest, and I hope this accomplishment unlocks many future endeavors. It wouldn’t have been possible without them.
Finally, I’d like to thank Peter Pell, Stephen Winterstein, Alan Leist, Roger Vincent, Davis Parr, Meredith Whitney, Jim Harberson, James Altucher, and Josh Brown who provided me with direct feedback to help make this book a reality. A special thank-you to Tony Guernsey who gave me my start and the opportunity to succeed in the wealth management industry.
About the Author
Frazer Rice is a leading private wealth manager with fifteen years’ experience advising millionaire and billionaire families on finances, including fiduciary and estate matters. His clients include business owners, hedge fund managers, real estate developers, corporate executives, foundations, and established families.
Frazer has been featured in the New York Times, the Daily Telegraph, and the Journal News, and he has appeared on cable television news networks. In addition to his financial expertise, Frazer is a member of the New York State Bar and a graduate of Duke University and Emory University Law School. He hosts a podcast and blog on politics, business trends, and entrepreneurship at www.FrazerRice.com.