Overcoming adversity - what car racing can teach us about money and life

The 35th annual Pittsburgh Vintage Grand Prix concluded yesterday. The event’s mission is to produce a world-class vintage racing event in order to raise funds to help provide residential care, treatment and support for developmentally disabled individuals in the Pittsburgh region.

I have first attended the event in 1988 shortly after moving to Pittsburgh and have volunteered for it several times. While I do not race cars, I have occasionally enjoyed days driving at the track. Understanding the physical dynamics of racing, will not just make us safer drivers on regular roads but also teach us to better handle tense moments in other aspects of our lives.

Entering a turn too fast can send your car in oversteer.  The tail end of the car spins out as tires lose grip. You don’t have to race in order to experience this. It may have happened to you while driving on an icy road.

Spinouts are not limited to roads and tracks. They are part of everyday life. In our permanent quest to fulfill our biological, emotional and logical needs we will invariably face adversity. To learn more about setting personal goals in these key areas, you may revisit “Setting your goals – a practical framework” post:  https://www.linkedin.com/feed/update/urn:li:activity:6285244145703407616

Single-mindedly pursuing our own agendas at full speed, without empathizing with the needs of those we care about, may drive them away and send our personal lives into a tailspin. Looking to make a quick buck by investing our money too aggressively can result in large losses when markets turn against us. These large losses may jeopardize the chances of achieving our longer term financial goals and legacy projects.

While the best course of action is prevention (not driving too fast), sometimes adversities occur. When they do, the most common knee jerk reaction is to panic and over-correct. Don’t do it!

·         If we hit the brakes as the tail end of the car starts sliding, the wheels will lock, tires will lose grip and the car will go in a full spinout - we may die.

·         If we supplicate to others and ultimately blame them for not conforming to our agendas, we will drive them away and never learn how to actually go about fulfilling our emotional needs.

·         If we sell out of our long-term investments when markets go down, we may turn temporary paper losses into permanent losses – our long term security and legacy may be jeopardized.

Do this instead

·         Look up the road to where you want the car to go. Slightly turn the steering wheel into the slide, wait for the car to straighten and keep on driving.

·         Keep our long-term emotional needs in mind.  Seek to understand the emotional needs and motivations of others we care about. Give a little and we may be pleasantly surprised.

·         Keep our long-term financial and legacy goals in mind. Opportunistically make investment adjustments, but put short-term setbacks in perspective and be patient.

The organizers of the Pittsburgh Vintage Grand Prix did not over react in front of their first year’s logistical challenges of setting a temporary track in the middle of one of the city’s most popular public parks. They followed their mission and made the necessary adjustments.  Last year, the organization donated over $4 million to two deserving charities: the Autism Society of Pittsburgh and Allegheny Valley School.

When faced with adversity, follow these steps:  do not panic, figure out what is causing it, keep your eyes on your goals and make calibrated adjustments.


Upwards and onwards,


Andrei Voicu, CFP®

How to take command of yourself and your finances

How to take command of yourself and your finances to build a life designed to be successful and rewarding both now and in 10,15 or 25 years.

Good things don’t just happen

Our modern society is an anonymous society. Extended families are geographically scattered. Everyone is busy toiling along on their own. Over 50% of marriages end up in divorce and many more are stuck in a rut. Expectations of happiness are often not met.

Many people treat life as some mythical emotionally-driven process. Things are supposed to just happen for some undefined reason. Just like in the movies, everything will work out in the end. Except, for when it doesn’t. The process is devoid of logical forethought or planning. There is no clear understanding on how things really work. There are no clearly defined end goals.

Nowadays, we often lack traditional role models who used to pass along their accumulated wisdom. Folks are forced to relearn life experiences from building and managing relationships to handling finances through stumbling, failure and experimentation. Some of the lessons that have been lost are things most people won't learn in two lifetimes.

Make good things happen instead

So how do you reclaim control? You must lead! Actively educate yourself and seek guidance from people who have the experience and the knowledge that can benefit you. Learn what works and what doesn’t. To be successful in all aspects of your life from personal relationships to financial freedom and self-actualization you must have a plan.

For the purpose of this post, I will limit my comments to money matters.

Set goals and quantify them in dollars and cents. Build a comprehensive plan. Implement it. Monitor your progress and make adjustments when needed. Repeat as necessary.

Step 1 – Education and guidance

You can save yourself some money by educating yourself on financial matters and performing your own investment work. As complexity increases hiring a financial advisor with the experience, knowledge, tools, resources and investment opportunities not otherwise available to you can provide true value.

The web of available financial service providers can be confusing to many. Whether you are deciding on hiring an advisor for the first time, adding an additional one or considering replacing your current one, ask yourself the following questions:

1)      Is the advisor’s compensation aligned with your best interest / is the advisor a full time fiduciary?

2)      What are any potential conflicts of interest?

3)      Does the advisor have hands-on investment experience or is simply re-selling someone else’s work?

4)      Does the advisor tailor investments for you, or one size fits all prepackaged portfolios?

5)      Does the advisor specialize in working with people like yourself?

6)      Is the advisor’s client load an impediment in offering personalized services?

7)      Does the advisor have unlimited access to investment opportunities?

Step 2 – Define and articulate your own goals

I have previously covered the topic how to go about setting your goals. If you have not read that blog you may find it here: https://www.linkedin.com/feed/update/urn:li:activity:6285244145703407616

Step 3 – Build and implement a plan

Consider how much money you will need to cover your three main life priorities: biological needs, emotional needs and the desire to leave a legacy behind, not just now but 10, 15 or 25 years from now. Invest your money accordingly: safe, liquid cash reserves, or insurance to cover your current biological needs in case your earning power is disrupted. Use moderate risk investments such as properly diversified portfolios of stocks and bonds to cover basic expenses and cover the cost of your emotional desires further down the line. Finally, consider less liquid, higher potential return investments such as private equity and private real estate to build your own legacy, “immortality project”.           

Step 4 – Monitor and adjust

Periodically measure your progress. Assess if your investments are performing as they have been designed to perform and your expectations are met.

While planning is a key element of success, micromanaging every individual detail is foolish. Life will bring surprises you can in no way expect and take you far afield from where you intended to go. Expect the need to recalibrate and adjust your plans accordingly.

At Quattro Advisors we can help you design and implement your own personal plan starting from the bottom up.  All Quattro partners and staff are directly involved in research and planning. I personally bring over 24 years of experience in hands on investment research and portfolio management by having led the investment process in over $1 billion in clients investment assets.  Our investment process is purposely designed to provide bias-free recommendations based on in-depth detailed research and access to investment opportunities not available through many traditional financial services providers.

Andrei Voicu, CFP®

Setting your goals - a practical framework

“Out, out, brief candle!” Yet the finer words provide no solace; the final act is always the same.”

William Shakespeare - MacBeth

Life’s Purpose

Does it matter if your life matters?

In 1973, cultural anthropologist Ernest Becker published “The Denial of Death” which won the 1974 Pulitzer Prize for General Non-Fiction.

The premise of the book is that human civilization is built around one central principle: give people a reason to believe that they will live on past physical death.

Perspective matters. Mindlessly carrying out a purposeless, random existence birth, growth, adulthood interrupted by buying stuff, and finally dying can lead to a sense of helplessness and depression. We begin to wonder: what is the purpose of all this struggle? There must be more to life than this.

The antidote? Defining our purpose(s) in life is our "immortality project," as Becker calls it.

·         Carrying for family and children, to pass on our genes to ensure the survival of our own lineage (and maybe even the human species)

·         Being remembered by the world for achieving great things

·         Actively engaging in hedonism by losing ourselves in the joys and sensations of now without worrying about mortality

·         Believing in an after-life, where by worshipping a god we will live in bliss for eternity with all the people we have known and cared about

In short, denying death in our own special way.

Know yourself

Now, how do you plan on finding your “immortal purpose”? It’s a personal question. Consider your biological needs which we must satisfy to survive: breathing, eating, responding to fear and anger, sex.  Fulfilling them brings pleasure, and ignoring them brings pain, or even death. Now consider your emotional needs: a sense of belonging, being understood, respected, loved, desire for learning and exploring new things.  Finally, consider your logical needs:  what we actually control. They involve abstraction, planning, reasoning, and strategy.  These are desires such as "building a business" or "learning a skill". Now think of these needs in 10, 15 or 25 years from today—will they be the same?

Once we a have a general picture of what it may take to fulfill our biological and emotional needs as well as our life purpose, we got the road map, a blueprint. It is time to figure out the money part.

Personal finance requires flexibility. Plans may get shot to hell by biological impulses or immediate needs (I want that car! This kid needs braces). These earlier brains care far more about filling their basic and emotional needs than they do about the logical and thoughtful financial plan the neocortex brain has worked so hard to help us craft. Planning out finances is not a one-time deal. It’s an ongoing process that constantly evolves as life throws us curve balls over time.

At Quattro Advisors we have the experience and know how to help you navigate through the process with a holistic, goal-oriented approach where your progress is reviewed and clearly communicated. The necessary planning and investment adjustments are made to continually stay focused on your ever moving targets.

Andrei Voicu, CFP®


Happy as children

When we were children, we didn't trouble ourselves with the search for happiness, because it was always within our grasp. If we could just play with that new toy, run in the woods, swim in the pond or spend time roughhousing with our friends, we felt satisfied and at peace.

When we grow older, we lose ourselves in the pursuit of careers and families. As full satisfaction often remains somewhat elusive, we may also search to build a legacy of making a positive difference in other people’s lives.

Doing anything we want doesn’t always require money but it often does. The realities of juggling our financial resources are unique to every individual. Medical professionals face additional unique complexities in managing their finances.

Many physicians have two or more employers, may have a private practice and / or earn additional income from consulting work. Such setup results in a plethora of retirement plan options that need to be understood, coordinated and managed. 

Coordinating contributions

One question physicians most frequently ask is how much they should contribute and to which account. Some financial advisors recommend contributing every penny allowed under the law. This may not always be necessary.

Ultimately, the optimum contribution level varies from person to person. Understanding how we spend as we age can help us build better retirement plans, craft more effective investment strategies and attain more successful outcomes. Successful outcomes can be obtained by correctly matching our lifestyles and legacy goals with our assets, savings rate, earning power and comfort level with taking risks.

At the very least, physicians should seek to take full advantage of the matching contributions from their employers. Matching employer contributions typically range from 50% of the employee contributions up to 6% of salary to 150% of the employee contributions up to 8% of salary[1].

As an example, let’s assume a physician earns $50,000 from a university and $300,000 from a hospital. The physician may maximize the match by contributing 8% ($4,000) of the university salary and 6% ($18,000) of the hospital salary to 403B plans. According to Federal rules only a total of $18,000 contribution can be made before tax by any one employee. In this case, $4,000 of the physician’s contribution will be made with after tax dollars.

The university matches 150% of the physician’s contribution ($6,000) of the physician’s contribution to a 401A plan. The hospital matches 50% of the physician’s contribution ($8,100) [2].

Older employees in certain plans may benefit from accelerated matching contribution options, but should consider these with care. The option is irrevocable and all employer matches may stop after 10 years.

Contributions made above these levels will not benefit from employer matches and will be made with after tax dollars. However, the investment growth and earnings in these accounts are not taxed, thus are still better than personal accounts for long term accumulation of assets.

In 2017, if under the age of 50, the total combined employee and employer contributions to any one plan is $54,000. If over the age of 50, employees benefit from a “catch up” provision allowing them to contribute an additional $6,000. As a result physicians benefiting from two employers’ retirement plans can contributions as large as $120,000 per year.

Some retirement plans offer in service withdrawals. Employees can roll over before tax retirement balances into an IRA and after tax retirement balances to a Roth IRA while still employed, starting at age 52. This option is known as the Mega back door Roth IRA, as it allows circumventing income and contributions limits otherwise in force.

Coordinating investments

Multiple retirement plans and personal accounts may give the illusion of diversification and safety. If not properly coordinated, investments may significantly overlap and risk may be far greater than it appears. Conversely, potential returns may be left on the table.

Many traditional asset classes are exposed to similar risk factors. Quantifying and making the appropriate adjustments to the aggregate exposure to equity, interest rate, credit and currency risk across all holding may help prevent unexpectedly large losses in times of market pullbacks.

Since not all plans offer the same investment choices, it is prudent to look at the overall picture of all assets and invest all accounts so they properly complement each other.

Physician Retirement Planning Checklist:

1)    Are you effectively coordinating and maximizing your employers’ retirement plan matching contributions?

2)    Is your contribution level in line with your long term goals, risk tolerance and time horizon?

3)    Do your choices of investments across multiple retirement plans and personal accounts properly complement each other?

4)    Are you taking unnecessary risk or leaving potential returns on the table?

5)    Are you taking advantage of additional and complementary investment opportunities through in service rollovers to IRAs / Roth IRAs?

6)    If receiving 1099 income, are you contributing to a SEP IRA to help avoid AMT (Alternative Minimum Tax)

7)    Are you paying more in taxes on your personal investments than you need to?

Somewhere in the middle all of this complexity, we may begin to long for a way to get back that youthful contentedness we felt much of the time as children and that left us long ago. A robust financial plan and retirement plan design under professional care may free up some worries and bring us a step closer to being satisfied and at peace.

Andrei Voicu, CFP®

[1] Retirement plans and matching contributions vary from plan to plan. Employees should consult with plan administrators for their specific circumstance

[2] ERISA (Employee Retirement Income Security Act of 1974) rules cap maximum salary levels on which employee retirement plan contributions can be made on to $270,000) to a 401A Plan

Hope and Fear

Get to know your advisor!

In this blog I share some personal background and a brief history of the markets over the 23 years I have been managing investments. There has been a lot of drama.  Investors' hope for riches alternated with their fear of loss. We are fast approaching another junction. The days of central banks carrying the day are coming to an end. Will hope or fear prevail? How should you invest?

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