How did your parents handle it?

This prior experience will go a long way in shaping your perspective on the prospect of aging and arranging for care.  Did you provide care for a loved one or assist your spouse in arranging for care for an in-law?  If so you have a unique understanding of the burden this immense task presents.   If not, perhaps you have witnessed a friend or another family member go through this process with their parents.  Alternatively, a generation ago, care was handled differently and life expectancy was shorter for those who developed health issues.

How is your health now?

If you are healthy when you decide to discuss this issue with your family and advisors many more options exist than if a health event has occurred.  While you are able a health assessment can be done and insurance can be considered.  Also you can consider restructuring assets to qualify for programs designed to cover long term care later in life.  Or you might look into the option of a continuing care retirement community (CCRC).  These residences are becoming increasingly popular and offer a plan for long term care if it’s necessary down the road.

What planning have you done already?

Do you plan to stay in your home as long as possible?  If so, is it a residence conducive to aging?  Is it one level or are there steps?  Have you discussed with your children their feelings toward the family home or how contributing to a family member’s care might affect them?  Some parents feel they don’t want to be a burden.  However, the children may feel a duty or honor in coordinating the work.

Regarding asset planning, do you have a proper Health Care Power of Attorney and Advance Directive in place?  Has it been reviewed in a year and is it stored in a place where those involved can access it?  Specifically, does it allow the decision maker to gift assets if it means you will better qualify for government services?  Does the document use language and medical terminology that are the latest methods in life sustaining care?

Are there any programs you can utilize?

There are two main government programs that people associate with long term care:  Medicare and Medicaid.  Medicare does not cover long term care beyond 100 days.  During the initial 100 days it can cover some of the costs, but only in certain circumstances.  Medicaid, on the other hand, can cover long term care costs in a nursing home, though one has to have negligible assets to qualify.  Care is almost always provided in a nursing home, which isn’t the usual preferred choice.

What is covered by long term care insurance?

If you buy a form of long term care coverage is it the best kind for your preferences and asset profile?  There are many varieties of coverage in the marketplace today.  There are a couple of different ways for your family and you to receive funds for the cost of care.  Terms like “reimbursement” and “indemnity” are often used to outline when and how much of the benefit may be utilized.  Reimbursement generally only allows benefits once a bill for the actual care has been produced and paid.  Indemnity on the other hand allows funds to be used for a wide variety of costs once care is defined as needed and a plan of action has been put into place.  Most traditional long term care policies use a reimbursement model in their contracts.

What are the next steps?

The next step is to work with a wealth advisor who can inventory these questions and guide you in the right direction based on your particular answers.  Long term care isn’t just an insurance product; it’s a plan for the rest of your life.

Brian has been in the financial planning field for 12 years.  Brian focuses his practice on non-business owners and specifically, public sector employees in the areas of retirement planning, wealth preservation and insurance protection.

Securities offered through Triad Advisors, Member FINRA/SIPC.  Advisory Services offered through Planning Solutions Group, LLC.  Planning Solutions Group, LLC is not affiliated with Triad Advisors.

Not FDIC Insured, No Bank Guarantee, May Lose Value

Don has been a financial advisor since 1987 and is a member of the Financial Planning Association (FPA). His practice focuses on high net worth business owners, physicians, and retirees in the areas of wealth management, business continuity planning, fringe benefit design, estate planning, and qualified plan analysis.

Securities offered through Triad Advisors, Member FINRA/SIPC.  Advisory Services offered through Planning Solutions Group, LLC.  Planning Solutions Group, LLC is not affiliated with Triad Advisors.

Not FDIC Insured, No Bank Guarantee, May Lose Value

Maybe these disconnects recur because we forget that Janus also represents endings or closure and that to understand the future, we must spend some time reflecting on the past.  Reflect first, then resolve.

As Howard Bank reflects on 2012, we see a year of successes as shown in our yearend earnings release – loans up 17%, deposits up 20%, transaction deposits up 55%, and income up 17%.  We crossed the $400 million in assets threshold – all driven organically through some very tough years for banking.  We successfully raised $10 million in the equity markets to fund future growth – organic and acquired – and we listed our stock on NASDAQ after becoming an SEC registered company.  We also began work on our first branch in Baltimore County to complement our two locations in Annapolis and our four locations in Columbia and Ellicott City.  Click here to view our Earnings Report 2012.

But reflection is not just about the what, but about the why.  So when we look back and reflect, we are thankful to our stakeholders – shareholders who supported the capital raise, board and management leadership who had the courage to move forward rather than just “hunker down” as some others in the industry did, employees who delivered the Howard Bank value proposition every day, and clients who honored us by seeking our advice and support to help them achieve their dreams.  We have been successful because we chose good partners.  These stakeholders are our strategic partners – and our long-term goals are aligned with their long-term goals.

With this strong foundation in place, and the reflection that our foundation has been built by a community of strategic partners, we now resolve to continue along a path of greater and greater impact.

When we started the bank almost nine years ago, we did so to have an impact: on our shareholders through capital growth and eventually market recognition of that growth, on our colleagues through a sense of meaning, accomplishment and legacy as the best award for hard work and shared expertise, on our customers as they grow and achieve their dreams and on the communities in which they – and we – live and thrive. We will continue to do that.  But it is not just more of the same.  If reflecting must be about what and why then the resolutions need to be about what and how.  So we also resolve to increase our impact by refining the how – by keeping the good that is critically important and subtracting the good that distracts from our mission.  That may sound funny – keep the good and subtract the good.  But if we are to increase our impact we must continually focus on what most helps our strategic partners – customers, employees, shareholders – and subtract out the activities that may be “good” but do not support these goals. Good strategy and better execution are as much about what we do not do as they are about what we do.  It is all about alignment.  So we keep “sharpening the saw” as the late Stephen Covey counseled, so that our advice is good, our expertise continues to grow and our impact is stronger.

Those are our reflections (thank you to our stakeholders) and those are our resolutions (choose wisely as we grow).

I leave you with a few questions to accompany these thoughts.

Have you reflected on your own strategic partnerships over these past difficult financial and economic years?  Have you resolved to do business with partners with whom you have an alignment – both an affinity and a commitment to you?  If not, why?  Is it inconvenient?   It’s ultimately your choice.  Do you want your own Janus to see a brighter 2013 or the same clouded 2012?

If, upon reflection, you resolve to only work with partners whose interests are aligned with yours, we are a great alternative.  And if you need help to reduce any inconvenience, just call and we will come to you.

The basic purpose of diversification is to reduce your risk of loss. It’s primarily a defensive type of investment policy. Depending on your investment goals and tolerance for risk, your strategy may emphasize one type of investment over another. But overall, your plan should be diversified. That’s because no single type of investment performs best under all economic conditions. A diversified program is capable of weathering varying economic cycles and improving the trade-off between risk of loss and expected return. Of course, diversification cannot entirely eliminate the risk of investment losses.

* Diversification may help reduce, but cannot eliminate, risk of investment losses.  Historical performance relative to risk and return points to, but does not guarantee, the same relationship for future performance.  There is no assurance that by assuming more risk, you are guaranteed to achieve better results.

Forms of Diversification. An investment portfolio consisting of twenty different construction industry stocks is not diversified. Diversification means dividing your funds among different asset classes, such as stocks, bonds, real estate and savings accounts. For instance, suppose your portfolio consisted entirely of bonds. Your money would be at significant risk if interest rates rose since bond prices generally fall when rates go up.

It’s also important to diversify by owning several stocks in different industries. Suppose you held just 1,000 shares of a major company’s stock and during the last recession you suffered a loss of $40 per share when the stock fell from 100 to 60. A diversified portfolio consisting of many different stocks in various sectors may have cushioned the blow of the loss.

Diversification also means not tying up all your funds in long-term investments. You’ll need to keep a certain amount easily accessible — that is, in money-market accounts, savings accounts or short-term certificates of deposit (CDs) — for on-going expenses, emergency needs, and short-term goals such as saving to buy a car or pay taxes. And through dollar-cost averaging, a process of buying stocks and bonds from time to time instead of all at once, you can spread the risk over both good and bad markets. Using dollar cost averaging does not assure a profit and does not protect against loss in a declining market.  Using this investment method involves continuous investment in securities regardless of fluctuating price levels of securities. Therefore, investors should consider their financial ability to continue purchasing through periods of low price levels.

Sample Portfolio. Your specific investment decisions will depend on several factors: your age, tax bracket, risk tolerance, liquidity needs, investment time horizon and investment goals. In general, however, a well-diversified portfolio might include:

• Cash Reserves for short-term needs — checking accounts, money-market accounts, savings accounts and shorter-term CDs.
• Longer-term, taxable investments that are relatively liquid, such as:

*        Stocks — common or preferred

*        Bonds — U.S. Government, corporate

*        Mutual Funds — bond funds, growth funds, balanced funds, international funds

• Tax-advantaged investments, such as:

*        Annuities — fixed and variable

*        Qualified Plans — 401(k), 403(b), IRAs, SEPs

*        Municipal bond funds

• Real estate — commercial, residential

You may want to consult a financial advisor regarding designing a portfolio that is right for you and your risk tolerance.

Diversify Beyond Investments. Diversification alone may not be sufficient to protect your investments. By taking a broader view, a financial planning strategy can put safeguards in place to help protect yourself and your family.

For instance, purchasing disability income insurance provides protection for your ability to earn a living. Life insurance is another form of protection. It can help preserve your estate assets and reduce the risk that a disaster could wipe out your family’s standard of living. Life insurance can also provide the necessary cash for your survivors to pay estate taxes and other expenses, or to carry on a family-owned business.

A diversified financial planning strategy will not eliminate risk or guarantee success. But it can offer a sound approach to help accumulate, preserve and protect your assets, reduce risk and potentially grow assets over time. Talk with a qualified professional about how to put an effective financial planning strategy in place.

Kathy Armstrong is a CERTIFIED FINANCIAL PLANNER^TM professional and works with Heritage Financial Consultants in Hunt Valley.  She is an investment advisor representative through Lincoln Financial Advisors Corp, a registered investment advisor and broker-dealer, member SIPC, 307 International Circle, Suite 390, Hunt Valley, MD  21030, 410-771-5655.  Neither Heritage Financial Consultants nor Lincoln Financial Advisors is affiliated with Howard Bank.  CRN201112-2061913

Do you ask for referrals?          Many small businesses have to rely on referral sources to keep business steady. Have you asked your current customers for referrals? This is a marketing channel that in many cases can be very inexpensive but you have to ask for the referral. Writing a simple Thank You letter to your customers and placing a couple of business cards in the letter asking for referrals maybe a good marketing channel you haven’t identified.                                                -          May 25, 2011, “Marketing and Small Business – Questions to ask yourself.”

I received a couple of emails on how would you actually ask for referrals based on the above post.  I touched on it above but have put this quick Action Plan together below to help you with asking for referrals:

• Make a list of your current customer base (if you have an extensive customer list break it down to a manageable list).
• Call each customer as a “courtesy” to see how everything is going.  This should not be a sales call but rather a courtesy call.  Keep the conversation short and to the point and specifically ask how your product / service is benefitting them and if they have any questions or concerns about the product (not only a courtesy call but ensuring your customer is still happy).
• Follow the call with a handwritten Thank You note.  In the brief note you would simply let them know that you appreciate their business and you would appreciate any referrals of friends or family who can benefit from your product / service (include 3 to 5 business cards and any referral offer you may be running).

Do you ask for referrals?          Many small businesses have to rely on referral sources to keep business steady. Have you asked your current customers for referrals? This is a marketing channel that in many cases can be very inexpensive but you have to ask for the referral. Writing a simple Thank You letter to your customers and placing a couple of business cards in the letter asking for referrals maybe a good marketing channel you haven’t identified.                                                -          May 25, 2011, “Marketing and Small Business – Questions to ask yourself.”

I received a couple of emails on how would you actually ask for referrals based on the above post.  I touched on it above but have put this quick Action Plan together below to help you with asking for referrals:

• Make a list of your current customer base (if you have an extensive customer list break it down to a manageable list).
• Call each customer as a “courtesy” to see how everything is going.  This should not be a sales call but rather a courtesy call.  Keep the conversation short and to the point and specifically ask how your product / service is benefitting them and if they have any questions or concerns about the product (not only a courtesy call but ensuring your customer is still happy).
• Follow the call with a handwritten Thank You note.  In the brief note you would simply let them know that you appreciate their business and you would appreciate any referrals of friends or family who can benefit from your product / service (include 3 to 5 business cards and any referral offer you may be running).

Many of us have just finished long late evenings filled with vicarious living as we watched the 2012 Summer Olympics – albeit on a time delayed basis. We know that the Olympics have been around and have honored traditions  for a very long time (776 BC) but that they have changed with the times – televised, split into different years for winter and summer games, inclusive of some paid athletes (tennis stars, ice skaters), offering new sports (women’s boxing). But we enjoy them not for what has changed but for what has not really changed. We enjoy them and follow them and talk about them incessantly in the break room  (and destroy office productivity to the tune of $650MM) because they are the increasingly rare ”pure” competition that pits talented individuals and teams against one another simply  in search of ” the best”. While money and endorsements and contracts follow, these athletes sincerely view those as extras, icing. It is the affirmation of talent honed by years of hard work that is the prize – nothing as ephemeral as a cereal box placement or even an Under Armour ad.  Every Olympic athlete – with or without a medal – epitomizes what it means to stretch for a goal – one’s skills, one’s time, one’s patience, one’s focus are all tested. And so we view each of them as a winner – not just the three on the award stands – not just the ones singing their national anthem. We respect them, we emulate them, we salute them and for a few days in August we live through them. Because we too really want to stretch.

I am not a winning athlete – an abysmal runner (the original 12 minute mile), a forever Level 1 tennis player, a golfer in search of a handicap, a swimmer in search of a scuba tank but I love the idea that the all time medal winner (since 776 BC- a real all time winner) hails from Baltimore, has a Mom who still attends all his meets, makes mistakes and gets past them and is an emerging small (specialty) business owner in our home town. His stretch took him to Athens, Beijing, London and back to Baltimore. Maybe I love this image because I really believe that if you dream big, you get more out of life; that, as we age, we regret the things we did not do rather than the things we did do; that practice makes perfect; that underdogs are always more interesting than a sure thing and that life is all about Plan B. And I am not alone at Howard Bank with those beliefs.

Maybe that is why Howard Bank supports the inner athlete in each of us – the business owners who dream of being a brand name and sacrifice their personal time to advance that brand, the entrepreneur who finds a way to open a new location in a new market in a recession, the company that manages risk rather than avoiding it. Howard Bank respects the drive, the discipline, the attention to details – the relentlessly boring repetition that turns a sportsman into an athlete. We respect the grit of the small to medium sized business much more than the glitz and hype of the Fortune 100. We respect it…and we also live that life every day. You can click on our most recent press releases that describe our most recent medals – balance sheet growth in customer loans and deposits, our solid and consistent core earnings, our new branch in Annapolis, our new team in Baltimore and our newest capital raise . For us, Ellicott City, Columbia, Annapolis, Towson are our Athens, Beijing and London. We are your audience – applauding and supporting those efforts.  Let us know how we can help you stand on the winner’s platform.

Retirement planning is an ongoing process – it is not a “once and done” issue.  Putting together a plan to ensure you will reach your goals and not outlive your money is important work.

Here are decade-by-decade objectives to consider.

• Your 20s. You may feel broke, especially if you have college loans, but saving for retirement now will allow time to work for you.
• Your 30s.  You may have gotten married and have children, and the pressures to save for retirement are competing with many other demands. Don’t let them distract you, even if you decide to stop out of working.
• Your 40s.  Most people hit their peak earning about now.  College may be looming, but don’t sacrifice saving for retirement to save for college for your children.  College can be financed, but your retirement cannot.
• Your 50s.  You are into the home stretch. Hopefully by this point you have saved regularly and invested prudently.  Carefully rebalance your portfolio, and if you have fallen behind in your savings goals, work aggressively to catch up.  Some people in this age range have paid off their homes.  Use that cash to get ahead.
• Your 60s.  For many people, you are almost at the finish line.  Now is the time to take a reality check.  When can you afford to stop working?  Are you psychologically ready to retire?  At what age do you want to start drawing Social Security?

The most important step is to put together a plan – then change it as your circumstances dictate.  But, without a plan, you are leaving your retirement up to chance.  Take a careful approach for your retirement, and you will see tremendous results.

Kathy Armstrong is a CERTIFIED FINANCIAL PLANNER^TM professional and works with Heritage Financial Consultants in Hunt Valley.  She is an investment advisor representative through Lincoln Financial Advisors Corp, a registered investment advisor and broker-dealer, member SIPC, 307 International Circle, Suite 390, Hunt Valley, MD  21030, 410-771-5655. Neither Heritage Financial Consultants nor Lincoln Financial Advisors is affiliated with Howard Bank.   CRN 201112-2061908

Hackers, backed by professional criminal organizations are targeting small and medium businesses to obtain access to their web banking credentials or remote control of their computers. These hackers will then drain the deposit and credit lines of the compromised bank accounts, funneling the funds through channels that quickly redirect the monies into other accounts not owned by the business.

Avoid Business Account Takeover

A business account takeover is generally initiated by opening email or visiting legitimate websites and clicking on links, documents, videos or photos that unknowingly install malware programs designed to collect sensitive permissions and passwords. Sophisticated versions of malware can even capture token-generated passwords, alter the display of a website to a user, or display a fake website indicating the bank’s website is down.

Once installed, the malware provides information to hackers to impersonate the business in online banking sessions. To the banks, the credentials look just like the legitimate user. The hackers then move funds via wire transfers or ACH (electronic) transactions to other accounts not owned by the business.

Many hackers are currently targeting small and medium size businesses, municipalities, and non-profit organizations that may not have the sophisticated detection software or internal controls of larger businesses. Nevertheless, there are several steps a small business should consider to reduce the likelihood of a business account takeover.

Protect Yourself

• Use a dedicated computer for financial transactional activity. DO NOT use that computer for general web browsing and email.
•  Never open attachments or click on links from unsolicited emails.
• Apply operation system and application updates (patches) regularly.
• Use the latest versions of Internet browsers, such as Internet Explorer, Firefox or Google Chrome with “pop-up” blockers and ensure that updates (patches) are most recent versions.
• Use and maintain updated spam filters and anti-virus software.
• Have host-based firewall software installed on computers.
• Turn off your computer when not in use.
• Segregate responsibilities; require one person to enter/perform a transaction and a second person to approve the transaction.
• Do not approve transactions by batching them together, be sure to review and approve each one individually.
• Review your banking transactions daily.
• Use a dedicated bank account for ACH and wire transactions, only funding that account before you initiate transactions.
• Contact your information technology provider to determine the best way to safeguard the security of your computers and networks.

Potential Signs Your Computer System May Be Compromised

• Inability to log into online banking.
• Dramatic loss of computer speed.
• Changes in the way things appear on the screen.
• Computer locks up so the user is unable to perform any functions.
• Unexpected rebooting or restarting of the computer.
• Unexpected request for a one time password (or token) in the middle of an online session.
• Unusual pop-up messages, especially a message in the middle of a session that says the connection to the bank system is not working.
• New or unexpected toolbars and/or icons.
• Inability to shut down or restart the computer.

Avoid Identity Theft and Online Fraud

Scams such as Spoofing and Phishing to commit identity theft are becoming more prevalent. Identity theft involves the use of your personal information – your name, Social Security number, credit card, bank account numbers, or other identifying information – by someone else, to commit fraud or other crimes.

E-mail Phishing – Involves you receiving an e-mail, with something similar to “Official Information” or “Online Banking Problem” in the subject line, that appears to be from a legitimate company. It may even include the company’s logo and a link to an Internet address that looks appropriate. This e-mail directs you to link to a website where you are to supply account or personal information. This is not normal operating procedure for a reputable company and should be questioned.  Howard Bank will never send and e-mail that asks for information such as social security number, account number, or PIN.  Simply clicking the link could secretly install software on your computer. The software may infect your computer with a virus or record and transmit everything you type, including passwords. Additionally, the website you link to may be spoofing the correct Internet site.

Website Spoofing – Involves you trying to visit a website but accidentally keying-in or linking-to a different address. This may lead you to a website that mimics the legitimate site that you were trying to visit. The spoof Internet site may route whatever information you provide to criminals. This can include your account numbers, Social Security Numbers, credit card information, passwords and personal identification numbers. To make spoof sites seem legitimate, criminals may use the logos, graphics, names and code of the real company’s site. They also may attempt to fake the URL that appears in the address field at the top of your browser window and the padlock that appears in the lower right corner.

Skimming – Another method is called “skimming”. This method uses a small electronic device placed over or sometimes even inside a card slot at an ATM, gas pump, etc.  The device will capture information from a customer’s card, such as account numbers and PIN.  This recorded information is then used to create fraudulent cards.  If you notice anything out of ordinary, notify the machine’s owners immediately.

Sometimes, the scheme can be as simple as a phone call or letter asking you to update your information.  You should never give out personal information such as your PIN, social security number, or account number to unknown parties.  No reputable company will ever call you requesting this type of information.

Protect Yourself