Crane Asset Management LLC
Chief Investment Officer
Crane Asset Management LLC is a full-service investment counseling firm providing investment management services to private individuals, retirement plans, endowments, and charitable foundations. All accounts are managed on a discretionary basis. While investment portfolio consist primarily of equities, we also use fixed income securities for clients whose objectives require increased income and reduced risk. John Frye co-founded the firm in 2003, with a partner who remains Chief Operating Officer. They work with all of their clients to formulate a long-term investment strategy that will meet their investment objectives while addressing their risk profiles. Understanding their clients in this way enables them to develop unique plans based upon each of their clients’ needs to help them achieve their financial goals.
Before co-founding Crane Asset Management LLC, John served as Executive Vice President and Portfolio Manager at Renberg & Associates in Beverly Hills. He began his career with E. F. Hutton & Company in New York and subsequently worked with Alex. Brown & Sons in Baltimore. He received his Bachelor of Arts in Politics from Princeton University in 1977 and his M.B.A. from Columbia University Graduate School of Business. John holds the Chartered Financial Analyst® designation and is a member of the CFA Society of Los Angeles.
BA, Politics, Princeton University
MBA, Finance, Columbia Graduate School of Business
Assets Under Management:
Crane Asset Management is registered with the State of California. A copy of Crane's Form ADV filing (Parts 2A and 2B) can be accessed here. In addition, Crane's Form ADV (Part 1) can be downloaded from the SEC's website. (Type in Crane's name in the field provided and follow the instructions on the site to download the information required.)
Introduction and Overview
You have a lot of answers so I won't go over the same territory in this one. My contribution is this:
You have been given the gift of financial security. You now both have the opportunity to become something more than a nanny and a janitor. Both of you, go get an education. Find things you like to do and investigate job opportunities in those fields. Build a skill set. Don't be afraid to fail. Continue to live within your incomes so your investments can grow, but work on building careers that will generate both high income and high satisfaction. You won't live together forever, so use this time (when you don't have the expense of a home or family). Good luck.
Oh -- and make sure that some unscrupulous significant other can't get their hands on your money. That goes for both of you. This may require legal advice, so get it before you part with any money or get involved in a relationship that might wind up being costly.
I think this is a good example of the common misconception that an advisor does nothing for you besides build an investment portfolio. With the resources available to individual investors today, that task has very little value for many people and perhaps you are one of them. Thing is, I've met a lot of smart, capable people who have no clue how to invest and make basic mistakes that cost them a lot more than 1% per year. Here is what you get for your 1%. If it's not worth it to you, then do your investing yourself.
(1) You are spared the time and stress of doing your own research and monitoring the progress of your investment choices. If something happens when you are on vacation it could be very expensive not to have someone watching all day and every day;
(2) Your manager should be able to minimize capital gains taxes for you. A well-executed tax strategy will likely also save you more than 1% per year;
(3) Your manager might be able to prevent you from doing something dumb at a time when the market is in turmoil. If you need someone to save you from your own fears and prevent you from liquidating at the bottom, the fee is also well worth it; and
(4) if you need guidance about estate planning, charitable gifts, providing for children, and any of a dozen other issues that usually arise over the lifetime of a successful individual, it is very important to have a trusted advisor on retainer. Some years that advisor might not earn their 1%, and some years they won't.
But it's up to you, especially if your current advisor is not particularly skilled.
You have received a lot of good answers, so I will address just one thing you asked: "Should I invest .. or put it in a savings account?"
Your investment account IS your savings account. You shouldn't view them as separate entities. Say at some point in the near future you have $100,000 invested in a mix of good-quality equities. Say further that three months of expenses is about $15,000. You don't need to keep cash on the sidelines, uninvested, just because something unexpected might happen. Make sure your investment account has access to margin so you can take money out without having to sell anything. You clearly might not need all $15,000. After the emergency passes you will continue saving and replenish the amount withdrawn, right? So why keep anything an an account that pays essentially zero return?
If you are asking what the optimal stock price should be in 12 months, that's actually not a very smart question. Sometimes companies grow nicely but their stock goes down. If this happens, you should buy more. While "optimally" the stock should go up tenfold, realistically it would be nice (not essential, but nice) if the stock outperformed its peers, and also nice if it outperformed the market.
You should be asking where a company ought to be next year "in regards to growth" in revenues, cash flows and net earnings. If you researched the company before making the decision to buy, you presumably have expectations and it would be nice (again, not essential) if the company exceeded your expectations. For a one-year period, that's about it. You're a long term investor so you should stop thinking about one-year results. Where do you think the company will be in TEN years?
I love Warren Buffett's quote: "The best time to sell is never."
So -- your employer, a bank, is offering to pay for online courses so you can increase your earning power and acquire a useful professional skill? What's not to like? I presume there may be some commitment required of you in exchange for this benefit -- you don't say, but it seems reasonable that the bank would expect you to work for them for some period. That doesn't sound that bad, given that your accounting certificate might entitle you to a nice raise.
Question, because you are not clear: Will you be taking these online courses while you continue to work and collect a salary from the bank? If so, then continue with your plan to accelerate your loan repayment. If not, then obviously your budget will be tighter (in effect, you'd be paying for the continuing education because the bank would pay for it rather than pay you). If this is the case, then work out whether the amount of foregone salary is worth the boost in your earnings power over the long term. It might be a good investment in yourself.
It occurs to me that you have made a very good impression on your managers at the bank. They are willing to invest in you. This could portend well for your career there. Sit down and plan the next ten years. Set goals for yourself. If you can achieve those goals by staying at the bank and rising through the organization, great. If you have other plans -- an MBA, management career in some other industry, etc -- lay the groundwork now and learn as much as you can on the bank's dime. Most importantly, seek out mentors who can guide and advise you professionally. Even if you don't have long term plans to stay at the bank, look at your managers as a resource than can help you move onward and upward. It pays to have influential friends.