simplebooklet thumbnail

Fairhaven Journal: Spring/Summer

FAIRHAVEN
JOURNAL
WINTER/SPRING 2019
Master Your Emotions to
Become a Better Investor
TABLE OF CONTENTS
Note from Marc Horner ..........................................................................................................3
Control the Controllable .........................................................................................................4
Team Member Spotlight,
Heidi Orth .......................................................................................8
Meet the Fairhaven Team, .....................................................................................................11
Elevated Childhood Treat,
Asian Caramel Crisps ..................................................................12
Medicare Enrollment,
Making the Process Simpler ...............................................................16
Conservation and Advocacy at the Shedd,
Protecting Our Oceans ....................................... 19
A Bicontinental Success,
Client Prole. .................................................................................20
Aspen Wine
Perfectly Paired with a Good Cause
.....................................................................24
Fairhaven in the Media .........................................................................................................28
This material has been prepared for informational and educational purposes for our clients and friends. Please consult your Fairhaven Wealth Management professional to discuss how this may
impact your own financial plan and/or investment portfolio. This material is not intended to provide, and should not be relied upon for accounting, legal or tax advice or any other purposes. Neither
Fairhaven Wealth Management nor its subsidiaries or affiliates provide accounting, legal or tax advice. Please consult your tax advisor and/or attorney for such guidance. Advisory services offered
through Fairhaven Wealth Management, an SEC registered investment advisor. Securities offered through Triad Advisors, member FINRA/SIPC. Fairhaven Wealth Management and Triad Advisors
are not affiliated. For a copy of Fairhaven Wealth Management’s ADV Part 2 disclosure document please direct your inquiry to admin@fairhaven.com.
3
©2019 Fairhaven Wealth Management. All rights reserved. The information contained in this issue of the Fairhaven Journal is correct as of press time.
NOTE FROM MARC HORNER
Welcome to Journal issue #3! As some of us emerge from the Polar Vortex hitting Chicago and other parts of
the country, you may want to skip directly to the Fairhaven Team prole of Heidi Orth. One of her favorite
places is Hawaii…need we say more? Aer you’ve had a mental warm-up, skip over to a recap of topics we
discussed at the annual Year Ahead event last month, the role emotions play when investing. Also, you might
enjoy the proles of two classic American success stories; one involving the partnership between a French
immigrant and a high school teacher, and the other a family that is turning their passion for wine into a cash
generating machine to help people with disabilities. Of course, we also continue with our foundational topics
around food, philanthropy and healthcare.
Speaking of healthcare, we also have an exciting announcement! Jim Sullivan, the healthcare expert on
whom we have relied for perspectives on a range of healthcare issues, has accepted our oer to ocially join
the Fairhaven Team as our resident expert on all things healthcare, including evaluating decisions around
Medicare and Social Security. Jim spent 20 years with Arthur Anderson guiding clients through compensation
and benets decisions and he continues to serve the accounting industry as an educational resource for the
AICPA (American Institute of Certied Public Accountants).
While Fairhaven is surely not the only rm out there providing a dedicated healthcare resource to its clients,
I am condent in saying we are in the extreme minority. I am personally thrilled to have Jim join an already
strong team (said with all humility) in providing our clients access to a range of resources beyond just
investments.
Please join me in welcoming Jim to the team and, more importantly, do not hesitate to lean on his expertise.
Sincerely,
Marc Horner
Wealth Advisor
Founder
CONTROL THE CONTROLLABLE
Becoming a better investor by mastering your emotions.
T
he end of 2018 provided a reminder that
investment markets can be volatile. While a
relatively normal part of the investment
experience, dramatic market moves can sometimes
produce understandable feelings of anxiety.
Rather than hear about someones predictions about
what the Fed might do with interest rates or taris or
who is going to win the Super Bowl (none of which is
accurately predictable), we thought it might be more
interesting to get some perspective on things within our
control.
At this year’s Annual Outlook, our guest speaker was
Ken Haman, Managing Director of AllianceBernstein.
With more than 20 years of experience in psychology
and human behavior, Ken provides a unique perspec-
tive on developing the skills of being a successful
investor. In his work you will not nd references to
mathematical terms like Sharpe Ratio, Beta or Dura-
tion. Instead of spreadsheet processes, Ken tries to help
us elevate our awareness of our emotional processes.
At its root, investing is about addressing the emotional
challenges that come from being vulnerable in a big and
oen frightening world. We worry: “Am I going to be
okay?, “Is my family going to be okay?”, “What steps do
I need to take to protect myself?
ousands of years ago, humans answered that last
question by gathering into groups, developing tools and
weapons, cultivating elds, breeding livestock, building
villages, and surrounding villages with walls. ese
advancements were driven by the desires to increase
security and reduce risk.
Although civilization has advanced dramatically over
the past 50,000 years, despite our achievements, our
brain, central nervous system and survival instincts
essentially remain as they were back in the prehistoric
era. e result is an odd contradiction in how we
experience money and investing: our rational, educated
and modern brain thinks one way while our emotional,
instinctive and primitive brain can react very dierently.
A BRAIN IN TWO PARTS: INVESTING IS MORE
COMPLICATED THAN YOU MIGHT THINK
Over the millennia, the human brain evolves. e
oldest, most primitive part is the brain stem, the
structure that controls our instinctive ght-or-ight
reaction. Its primary function revolves around survival.
A newer section, the neo-cortex, has evolved to cope
with more complex issues; rational thought, language,
long-term planning and the ability to process a variety
of information needed to understand a complex world.
is insight—the idea of “two brains”—is central to the
challenge of investing. Investors perceive information
and then, based on their personal experiences and
5
interpretation, begin to react. If the information is
benign or pleasurable, the central nervous system may
decide theres no need to take strong emotional action.
However, when the information is negative or threaten-
ing, it can be a dierent story. Emotions can interrupt
our ability to think rationally. Fortunately, science has
revealed a way to become aware of these instinctive
patterns.
HEURISTICS: AUTOMATIC WAYS OUR
BRAIN TRIES TO MAKE DECISIONS EASIER
For all human beings, the dynamics of language,
thoughts and emotions are deeply connected. Research
has shown that sometimes the brain uses automat-
ic-thinking mechanisms or shortcuts to process and
react to information. ese are called heuristics, and
the study of how heuristics inuence nancial deci-
sion-making is the focus of the discipline known as
behavioral nance.
Dr. Daniel Kahneman was among the rst scientists to
uncover patterns of thinking, many of which signi-
cantly inuence how we make investment decisions.
Most of these patterns result in decisions that feel
natural and correct but cause us to make investment
mistakes. One classic example is how we naturally
distinguish between pain and pleasure. Kahneman
discovered that we are more than twice as motivated to
avoid pain as we are to seek pleasure. is means we
feel pain from an investment loss signicantly more
than we get pleasure from a gain. Even though mathe-
matically it would make more sense to see losses and
gains as similar measurements, it feels to us like they
are not. Kahneman called this heuristic loss aversion.
SOLVING THE OLDEST PROBLEMS:
HEURISTICS STARTED OUT AS SURVIVAL TOOLS
Heuristics such as loss aversion originally worked very
well. Because they are built-in patterns that get activat-
ed automatically, they enabled primitive humans to
survive and prosper. Unfortunately, while they may
work well enough in some situations, they typically
work very poorly when applied to investment decisions.
When a leading economic indicator drops, it causes a
similar feeling as the howl of a wolf. A short-term
correction in an asset class is like the snarl of a sa-
ber-toothed tiger. e drop of a few basis points in a
bond funds valuation seems like the movement of a
crocodile on the edge of a riverbank. e problem isn’t
so much that changes stimulate reactions; in many
cases, we should react to changes in our environment.
e real problem is the way we react. Our brains tend
to respond to changes we experience today the way they
did 50,000 years ago and use mental shortcuts that
might not t the current situation.
One of the shortcuts the human brain uses to cope with
a complex environment is to simplify challenges. For a
survival-oriented brain, keeping things simple is very
important. Unfortunately, when it comes to investing,
its possible to make things too simple.
Because the primitive part of our brain likes to keep
things simple, we sometimes lose track of our purpose
when investing. We can ght this inclination by setting
6
FEELING
THOUGHT
BRAIN STEM
NEO-CORTEX
Anxiety/
Urgency
Heuristics
Too Much
Information
Avoid Pain
Seek Pleasure
specic goals attached to a concrete vision of the
future. Detailed mental images allow your brain to
make rational sense of the investing process and keep
emotions under control. With clear goals and a
rational understanding, you can look at an investment
that has lost money in the short term and say, “Im still
on track and I’m doing okay!”
is brings us full circle to the ultimate question: “Am
I going to be okay?” is big question cannot be
simplied to a single number or one simple indicator.
It requires looking at how we cope with our built-in
vulnerabilities: the concept of ecacy.
e Oxford English Dictionary denes ecacy as “the
ability to produce a desired or intended result.” While
the denition is short, the importance of ecacy
cannot be underestimated. Each of us enters the world
as a small, fragile and completely dependent creature.
We spend years learning how our bodies work, how to
interact with others and how to cope with challenges.
As soon as weve mastered the basic skills for navigat-
ing the world, we become aware of our weaknesses
and vulnerabilities.
As we age, life becomes more complicated and the
consequences of failure become more serious. Ecacy
is found in people who feel they can overcome
adversity, protect themselves from dangers and
produce their desired results; they’re condent they
will be okay in the future.
Conversely, someone who lacks a self-concept of
eectiveness or has little condence sees the future as
uncertain and frightening. e human without
ecacy cannot condently answer the question “Am I
going to be okay?”. is has direct and signicant
implications for investing.
THE WEAKNESS OF 20/20 HINDSIGHT
Our brain tends to confuse looking back in time with
being able to predict the future. erefore, we oen say
“I should have known better” aer we make a mistake.
With the benet of hindsight, the negative results
now appear to be obvious and inevitable. In his book
inking, Fast and Slow, Daniel
7
Past Future
One of the shortcuts the human brain uses
to cope with a complex environment
is to simplify challenges.
continued on page 27
P
erformer Bruno Mars once said, “Hawaii is para-
dise. It might sound cheesy, but there is music in
the air.
Bruno, who grew up in Honolulu, would certainly con-
cur with Fairhaven administrative assistant Heidi Orth,
whose favorite vacation destination is Hawaii. “What
makes Hawaii so wonderful? Where do I start? e
picturesque landscape, unique foliage, wonderful ocean
breezes, the beaches, the marine life, the rainbows, and
all of the unique history and traditions…how’s that for
a list!” Heidi says.
Elaborating on her family trips to the Pacic, “We’ve
been blessed to be able to visit Maui and Kauai, and it’s
hard to pick which is better.ey are both beautiful in
their own way,” Heidi adds.
One recent trip to Maui brought Heidi face-to-face
with several awesome creatures of the deep. “I had been
hoping to see a whale. While on a boat trip over to the
island of Lanai, the captain was sharing with us various
points of interest and stories of “Old Hawaii. Suddenly,
a humpback whale breached in the distance directly be-
hind the captain. It was just like those pictures you see,
but it was real! It was an awesome sight! Toward the end
of our cruise, a large school of spinner dolphins (there
had to be more than 100!) swam alongside the boat
leaping out of the water. It was so much fun to watch!
A resident of Downers Grove, IL, Heidi spends her
beach vacations with her husband of 25 years, Dan, a
soware engineer. On these water-centric journeys,
Heidi enjoys a variety of outdoor activities. “I love
walking along the shoreline, especially uninterrupted
stretches of beach which seem to go on for miles.Shell-
ing, searching for sand dollars and unique rocks and
pieces of driwood all make the shore come alive.
Kayaking and snorkeling are fun, and who doesn’t love
a good boogie board ride? Of course, sunsets are also a
must,” Heidi says.
TEAM MEMBER SPOTLIGHT
Administrative Assistant
Heidi Orth
9
“We have a great group of people who
genuinely care about taking care
of our clients and each other
10
Heidis family includes three sons. Her eldest, Ryan, is
enrolled in post-graduate psychology studies in Mary-
land. Conor is a recent computer science graduate. And
Nolan is a rst-year student at North Central College in
Naperville, IL.
Having been part of the team at Fairhaven Wealth
Management since its founding, Heidi cites the culture
as her favorite aspect of the job. “We have a great group
of people who genuinely care about taking care of our
clients and each other. Smiles tend to come easy around
the oce and that level of comfort with one another
cannot help but create a positive work environment.
It might not be the same as a walk on the beach, but I
really enjoy being a part of the company,” Heidi says.
11
Gerald King
Wealth Advisor
Trent Warren
Wealth Advisor
Susan Kostecki
Administrative Assistant
Blair Fuchs
Wealth Advisor
Marc Horner
Wealth Advisor and Founder
Heidi Orth
Administrative Assistant
Michael Kronk
Emeritus
Amy Christenson
Media Consultant
Gina Hornbogen
Executive Assistant
Denise Jahns
Administrative Assistant
Barb Schrage
Administrative Assistant
Kurt Anderson
Wealth Advisor
David Edstrom
Senior Relationship Manager
Joseph Guest
Head of Operations
MEET THE FAIRHAVEN TEAM
e best people, carefully chosen, for service and results.
Paul Mardoian
Wealth Advisor
Dave Wilson
Social Media Manager
T
his was a childhood favorite treat that I used
to help my grandmother make. e original
recipe was a blending of chocolate and
butterscotch morsels slowly melted and combined
over a double-boiler. While certainly delicious “as-is,
we’ve tried to use our culinary knowledge to take
these tasty treats to another level of richness by using
a combination of white and bittersweet chocolate
chips along with some cream.
e cookie gets additional crunchiness from a mix of
fried lo ‘mein noodles, toasted sesame seeds and that
professional chef secret weapon…Special K cereal! e
cookies make a wonderful gi whether on Valentines
Day or any other day of the year you want to put a smile
on the face of your sweetheart. ey are also excellent
crumbled up as an ice cream topper.. Bon appetit! >
A CHILDHOOD TREAT...ELEVATED
Chef Owners, Academe Brasserie
Shanna and Brian O’Hea
Shanna and Brian O’Hea are the Chef-Owners of Academe Brasserie and e Kennebunk Inn in Kennebunk, Maine. is 1799 property
with 23 guest rooms and a 100-seat restaurant, anchors Main Street in one of Maines most popular tourist destinations.
e O’Heas have gained international recognition by participating in cooking programs around the world including: e Walt Disney
World Epcot International Food and Wine Festival and Holland America Cruise Line. Shanna has appeared on Food Networks “Chopped,
“Beat Bobby Flay” and winner of “Rewrapped.” Brian and Shanna will both appear on a new Food Network show in the spring of 2018 called
“Best in Seafood.
Academes signature Lobster Pot Pie has been featured in Oprah Magazine as one of Gayle Kings favorites, on Food Networks “e Best
ing I Ever Ate,” Travel Channel’s “Food Paradise,” and 2014 Travel and Leisure Holiday Gi Guide. eir Lobster White True Pizza
has appeared on the “O List” in Oprah Magazine and was also featured on Travel Channel’s “Food Paradise.” Both products are available
on MaineLobsterPotPie.com, a website the O’Heas developed to ship fresh Maine seafood overnight across the United States.
13
½ Cup Sugar
1 Teaspoon Corn Syrup
2 Tablespoons Water
1 Cup Cream
2 Ounces White Chocolate Chips
6 Ounces Bittersweet Chocolate Chips
1 Cup Fried Lo ‘Mein Noodles
2 Cups Special K Cereal
1 Tablespoons Toasted Sesame Seeds
1 Teaspoon Sea-Salt
METHOD
Bring cream to simmer in separate pot, reserve
Place sugar, water and corn syrup in quart size pot
over high heat
e sugar will dissolve and begin to boil, let boil
for 4-5 minutes
e sugar will begin to caramelize, remove o heat
when the color reaches a deep amber
Slowly pour warm cream into caramel o the heat,
it will boil rapidly and raise but will subside once
all the cream has been incorporated
Mix caramel sauce into the white and bittersweet
chocolate in a heat safe bowl with a rubber spatula
Once all the chocolate is melted and the caramel
sauce has been fully incorporated to achieve a
smooth ganache , mix in the fried lomein noodles
and special K cereal with rubber spatula so
everything is nicely coated begin to boil, let
boil for 4-5 minutes
Using two tablespoons scoop bite size pieces onto
Asian spoons or waxed paper sheet tray
Garnish with toasted sesame seeds and sprinkle of
sea-salt and refrigerate until set
Asian Caramel Crisps will last up to four days
under refrigeration
ASIAN CARAMEL CRISPS
14
E
nrolling in Medicare was never supposed to be
this confusing.Years ago, the process was simpler.
And less confusing. So, what has changed?
And what can you do to simplify the process?
Well consider each of those questions in turn.
WHAT CHANGED?
ere are six factors that have made the Medicare
decision more complex.
1.
e Normal Retirement Age (NRA) for Social Secu-
rity benets and the eligibility age for Medicare used
to be the same – 65. Enrolling in Social Security
and Medicare went hand in hand. You only had to
keep one date in mind. e date you reached 65. In
1983, however, Congress changed the law gradually
increasing the NRA from 65 to 67. e eligibility
age for Medicare remained 65. With this change,
enrolling in Social Security and Medicare was no
longer a “one and done” deal. If you wanted an unre-
duced Social Security benet you held o enrolling
until your NRA. Your NRA now comes aer your
Medicare eligibility. is means at 65 Medicare
enrollment is not automatic. You may go on line
(www.medicare.gov) and enroll or go to your local
Social Security oce to enroll in Medicare.
2.
More of us are retiring aer 65. Years ago, most
people (including your parents and grandparents
most likely) retired at 65. And why not? Social
Security and Medicare kicked in at 65. So, did
most company pensions. Many of us have now
begun working beyond 65. is has created
confusion about staying on the employer’s group
health plan versus enrolling in Medicare.
e worker’s spouse, if over 65, faces the same
question. Stay in the spouses employer group
health plan or move to Medicare.
3.
Many employers have ended retiree health care
plans. But many plans still exist. Employer retiree
plans combine with Medicare to provide coverage.
CPA and Financial Planner
James Sullivan , MS, CPA, PFS
17
MEDICARE ENROLLMENT
Making the process simpler
Should you enroll in your employer’s retiree
health plan?
4. Add into the mix COBRA coverage, Medicaid eli-
gibility and Obamacare plan coverage. Dont forget
Medicare eligibility before 65 because of disability.
Your current health coverage will impact your
Medicare enrollment decision.
5. e introduction of Medicare Part D (prescription
drug coverage) over ten years ago has added anoth-
er set of decisions. Finding the plan that best meets
your prescription drug needs at an aordable price
should be done annually during the Open Enroll-
ment Period that runs from October 15 through
December 7.
6. Finally, the rise in popularity of Medicare Advan-
tage (MA) plans. ese plans come with or without
prescription drug coverage (MAPD plans). Ap-
proximately one-third of all Medicare beneciaries
opt for a MA or MAPD plan. ese plans can oer
signicant benets. e dierent features make it
important to consider each plan available in your
area carefully. Recent legislation has broadened the
benets a MA or MAPD may provide beneciaries.
It also made making changes to coverage more ex-
ible with the addition of the Medicare Advantage
Open Enrollment Period which will run annually
from January 1 through March 31. e rst such
open enrollment period kicked o in 2019. More
options, more confusion!
If you make the wrong decision regarding when to en-
roll in Medicare, you may face late enrollment penalties
(that can be imposed for the rest of your life). Your
enrollment dates may also be restricted. is may leave
you with no health insurance of any kind for a period!
SIMPLIFY THE PROCESS
As you’ve probably gured out by now there is not a
cookie cutter” approach. Individual circumstances
matter. Here is what you can do to make the process
simpler.
First, begin thinking about your Medicare enrollment
well before your Initial Enrollment Period (IEP). Your
IEP lasts seven months. It begins three full months
before the month in which you turn age 65. It includes
the month you turn age 65. It continues for the three
full months aer the month you turn age 65. You can
also delay enrollment until aer your IEP but that must
be done with care. Note there are special rules for those
born on the rst of the month. eir Medicare eligibili-
ty begins the month before their birth month.
Second, at least six months before your IEP begins
do a “Medicare enrollment inventory” answering the
following questions.
1. Have you already started taking Social Security
benets before 65 or plan to do so before your IEP?
2. Will you continue working aer 65? Will you have
access to an employer provided group health plan?
Does the plan include prescription drug coverage?
3. Will your spouse continue working aer you turn
65? If his or her employer oers a group health plan
are you eligible?
4. When you retire, does your employer (or union)
oer a retiree group health plan? Is your spouse
eligible for coverage?
5. Do you have any of the following types of health
care coverage: COBRA or an individual or family
health plan (e.g., such as an Obamacare plan). Did
you become eligible for Medicare before age 65
due to a disability? Are you eligible for Medicaid?
Medicaid is a health insurance program provided
by the federal and state governments. It is open to
individual with income and assets below certain
thresholds.
In subsequent articles we will review the impact of
these individual circumstances on your Medicare
enrollment decisions.
Jim is a CPA and nancial planner. Jims practice focuses on helping
his clients think about and plan for the costs of health care in
retirement. He has written over 100 articles on health care costs
in retirement and a book on Medicare for the American Institute
of Certied Public Accountants (the AICPA). He is currently
writing a book for the AICPA on the impact of chronic and ter
-
minal illness on retirement plans. He lives in Glen Ellyn with his
wife, 3 children and 2 Beagles. Jim can be reached at jsullivan@
Fairhavenw.com
18
19
B
eyond the aquarium and across the globe, Shedd sta are
working every day to protect and advocate for aquatic wildlife
and their habitats. Just this past year, Shedd engaged in several
conservation eorts that had far-reaching results for the aquatic
animal world.
One important eort that Shedd hosted in 2017 throughout the ma-
jority of 2018 was the Washed Ashore: Art to Save the Sea traveling
exhibit created by artist Angela Haseltine Pozzi, which showcased 19
larger-than-life sculptures of aquatic animals, created entirely from
plastic beach trash. Since the project began, 10,000 volunteers have
removed more than 38,000 pounds of plastic trash from over 300
miles of beaches. e exhibit helped spark conversations with Shedd
guests about plastic pollution and the aquariums own plastic reduc-
tion eorts like Great Lakes Action Days and Shedd the Straw.
Shedd also initiated the #SheddeStraw campaign, aimed at raising
awareness for and reducing the use of single-use plastic. Scientists
estimate approximately 8 million tons of plastic trash end up in the
ocean annually, and plastic straws account for much of this harmful
waste. Partnering with several local organizations, including the
Chicago White Sox, Shedd has helped raise awareness for decreasing
the use of plastic straws. Overall, Shedd has cut its own plastic use by
70% since 2013. Click here to view a quick video on this program.
Abroad, Shedd sent veterinarian Dr. O’Connor to Madagascar to
help provide care to over 10,000 critically endangered radiated
tortoises who were held captive as part of a poaching scheme. In
Quebec, Shedd sta assisted in the rst rescue and relocation of a
stranded beluga calf in 2017. And Dr. Steve Kessel, Director of Ma-
rine Research, continues leading important research and conserva-
tion eorts to collect shark biodiversity data and collaborate with the
Bahamian government to preserve essential shark sanctuaries. Closer
to home, Shedd continues vital conservation work in Lake Michigan.
Looking for ways to get involved with Shedd? Visit Shedd’s website at
www.sheddaquarium.org or contact John Kinzer at jkinzer@shed-
daquarium.org to learn about the impact an Aquarium Council
membership has on Shedds global mission, as well as how it can
enhance your own experience.
CONSERVATION AND ADVOCACY AT SHEDD
Protecting our oceans
Lush gardens surrounding the Moreaus meticulously
restored 250-year-old French manor house.
21
O
n Dec. 26, 1976, Philippe Moreau was ying
back to Paris aer visiting family in the United
States. A native of France, Philippe spoke little
English – but across the plane aisle sat Diane, a foreign
language teacher based in central Illinois. She was es
-
corting a group of students abroad for the Christmas and
New Year’s holidays. During that ight, romance took o
and in June of 1978, Philippe and Diane married.
Before they were married, Philippe was working as an
assistant city engineer for a medium-sized city in the
Normandy region of France and Diane was continuing
her education career. Relocating to the United States,
Philippe was hired at an engineering consulting rm in
the western suburbs of Chicago. Diane also changed
her careers and transitioned from education to assisting
non-English speaking patients at a local hospital as a
medical interpreter and patient advocate.
Each of their careers continued to progress. Starting as
an entry-level eld staer, Philippe performed construc-
tion inspections and conducted surveys as he learned
the process of designing and building roads, sewers and
large waste water treatment plants. He also continued
his professional education via night school becoming
a professional land surveyor and engineer licensed in
both Illinois and Wisconsin, all the while improving his
prociency in the English language.
Diane went on to be promoted to Director of Patient
Support Services, managing the operations of the hos-
pital interpreting sta coordinating the more than 300
volunteers who regularly participated in the hospital
volunteer program. If that was not enough, she also
managed the hospital gi shop operations.
Over the years, the owners of the engineering consulting
rm couldnt help but notice Philippes work ethic. Di-
ane shares that feeling: “He worked hard and spent long
days, learning, listening, taking assignments and proving
himself to be loyal, responsible and reliable.” e owners
oered Philippe the opportunity to buy the company. It
was not an easy decision, but they decided to take the
plunge and in 1996 Philippe became the owner of the
rm he started at as a French immigrant – a classic, up-
by-the-bootstraps, American success story!
Philippe & Diane Moreau
A BICONTINENTAL SUCCESS
A chance meeting, hard work, passionate commitment, and careful planning
Transitioning from employee to owner was not all
croissants and champagne (French puns intended).
Ownership included both risks and new responsibilities
but under Philippes leadership the company contin-
ued to grow via a mix of entrepreneurial ingenuity
and engineering acumen. “Philippe recognized growth
opportunities in the environmental and electrical/con-
trol engineering elds and enlarged the company by
creating two additional consulting engineering rms to
capitalize on these opportunities.
Philippe and Diane started working with Marc Horner
of
Fairhaven a few years aer buying the company. “Marc
helped us think about the business as another part of
our investment portfolio. While maybe not the same as
shares of IBM or Apple, our investment in the business
represented equity risk. As the business grew and the
acquisition debt was reduced, we reallocated periodic
distributions in more conservative, income-producing
investments to both systematically “de-risk” our overall
investment portfolio and build a source of income for
our eventual retirement”, observes Philippe. “Tax-e-
ciency has always been an important goal and we appre-
ciate the proactivity of Marc and the team at Fairhaven
in communicating thoroughly with both our tax and
legal advisors.
roughout their relationship, a connection with
France has continued to be important to both Philippe
and Diane as they frequently visit family and friends.
In 2006, they re-established ocial French roots when
they purchased a dilapidated, 250-year-old manor and
adjacent centuries old forest located in the Brittany
region of northwestern France.
Completing the restoration took over six years! We
could write a book about turning an old, cold, granite
structure into a comfortable, warm, modern residence
with its beautiful garden and hilly landscape,” reminisc-
es Diane.
Coming full circle, in 2014 Philippe sold the engineer-
ing rm to the next generation of sta members and
just recently Diane retired from the hospital celebrating
40 years of service. e couple now split their time be-
tween Brittany, France and their home in the Chicago-
land area.
While in Britany, Philippe loves to work outdoors in
the forest surrounding their house and maintain their
farm equipment. “e property has enough grain pro-
ducing acreage that we are ocially “French Farmers.
Had Philippe told me the game plan was to retire and
become farmers, I may have thought twice about that,
laughs Diane.
Diane loves to visit the local farmer’s markets, which are
colorful and animated. “Although we live in the coun-
tryside, we can easily enjoy the beautiful coast of Brit-
tany, spending time hiking the trails, picking mussels
from the rocky ocean, enjoying walks on the beach and
the beautiful rugged clis. We also like to take day trips
to the various islands found in Brittany, and we love
to visit the old towns nearby with their cobblestoned
streets and beautiful architecture.
While residing in the land of Lincoln, Philippe has
several vintage car restoration projects going, including
a 1947 Lincoln Continental Coupe and a 1948 Lincoln
convertible. Diane keeps busy with tness classes and
volunteering in the community. “We like to discover
new restaurants and go to the movies. We also love to
visit our National Parks, which are Americas treasures,
Diane says.
More than 40 years aer meeting on a plane to Paris,
much has been accomplished by Philippe and Diane
both personally and professionally. e common thread
running through their experiences can be summed up
with one word…together.
22
(Facing, clockwise from top) Restored garden as seen from of the Moreau’s back terrace; Massive egg-crate style grille of Philippes
1947 Lincoln Continental; Brittany’s distinctively delicate yet meaty mussels; 17th century Chapelle de Saint-ey, Pointe du Van;
Medieval cobblestoned streets of northwestern France; e dramatic unspoiled beauty of Brittany ‘s coastline.
Transitioning from employee to owner
was not all croissants and champagne...
31
PERFECTLY PAIRED WITH A GOOD CAUSE
25
T
he story of the Aspen Lane Wine Company
begins with Bob and Sonya Evanosky and their
three sons: identical twins John and Christopher
and their younger brother, Jack. Each of the boys were
diagnosed in 2005 with a fatal genetic disease known as
metachromatic leukodystrophy (MLD).
Inspired to make a dierence and give back to the many
organizations who support families like theirs, in 2010
Bob and Sonya together decided Bob would leave a
successful career in aviation to form Aspen Lane. And
though Aspen Lane has only been around for a few years,
it already boasts 10 high-quality wines and has created
a variety of private labels for nearly 100 companies and
individuals, including one of Chicagos billionaire philan-
thropists.
An accomplished home winemaker, Bob had the idea to
combine his passion for wine with a for-prot business
that would provide recurring income to select not-for-
prot organizations that serve both children and adults
with disabilities. In developing the Aspen Lane busi-
ness plan, Sonya and Bob met with the Paul Newman
Foundation, which has given away over $400 million to
charities through sales of the actors salad dressing and
learned that there were about 20 other businesses in the
U.S. using a similar business model…but none of them
dealt with wine.
e rst step in executing on this plan was, of course,
making good wine. Sourcing grapes from top wine pro-
ducing regions like the state of Washington, Aspen Lane
produces high-quality wines with remarkable avor and
reliable drinkability. Producing a wide range of varietals
has expanded the appeal of Aspen Lane whether you are
a fan of reds or whites. Both the diversity and consisten-
cy of their wines has contributed to a loyal and growing
following extending beyond the Chicagoland home of
the winery.
“We work hard to create consistent taste proles from
year-to-year, so if you like one vintage, you will enjoy
the following year’s vintage just as much or maybe
even more., smiles Bob.
Unlike a typical fund-raiser or one-time donation, the
execution of their business plan has created a cash ow
engine that generates a repeatable source of income for
the various not-for- prot partners of Aspen Lane. Aer
costs, 100% percent of the money from every bottle goes
to their partner charities such as Marklund, MidAmerica
Service Dogs, Indian Prairie Educational Foundation,
Fox Valley Special Recreation Association, DayOne
PACT, the Aurora Area Interfaith Food Pantry and
the Aurora Veterans Advisory Council.
Seeing our vision to use wine as a catalyst for change
actually become a reality is remarkably rewarding”,
observes Bob. “While our small-batch winery will likely
never become a Mondavi or a Kendall-Jackson, we have
a lot of fun making great wine and seeing the prots
support organizations that do so much for people with
disabilities.” Cheers!
To learn more and to purchase Aspen Lane wine,
visit: www.aspenlanewinecompany.com
And for more information about MLD,
visit: www.evanoskyfoundation.org
24
True Norths spectacular fairways are lined with towering strands of hardwoods and
pines. FACING PAGE: Beautifully designed cottages that complement the serene
setting of the northern woods are available for those who choose to play and stay.
Kahneman provides guidance
about 20/20 hindsight: “Hindsight bias has pernicious
eects on the evaluations of decision makers. It leads
observers to assess the quality of a decision not by
whether the process was sound but by whether its
outcome was good or bad.…is outcome bias makes it
almost impossible to evaluate a decision properly—in
terms of the beliefs that were reasonable when the
decision was made.
A successful investment is especially tricky to think
about; if it performs well, most investors are seduced by
the thought that they made the right selection. Nassim
Taleb confronts this idea directly in his book Fooled by
Randomness: “Clearly, the quality of a decision cannot
be solely judged based on its outcome, but such a point
seems to be voiced only by people who fail (those who
succeed attribute their success to the quality of their
decision).” e great investor is humble in the face of the
conditions of uncertainty, complexity and urgency that
dene the challenge of
investing.
SOCIAL PROOF IS “FOLLOW
THE LEADER” FOR ADULTS
As we explore dierent types of heuristics, it becomes
clear there are many ways for our brain to answer the
wrong question. For thousands of years, decision-mak-
ing oen boiled down to asking, “What are other people
doing?” If everyone was running away, it was probably
smart to join them. If everyone was shing or harvest-
ing, that probably meant it was a good idea to do the
same.
Social proof is another heuristic that causes us to assess
the value of an investment by how popular it is with oth-
er investors. Like most heuristics, social proof feels right
and natural to the human brain. Unfortunately, when it
comes to investing, what everyone else is doing is rarely
an indicator of a good investment opportunity. It can
feel intuitively right and even compelling, but many
things about investing are counterintuitive and dicult
for the primitive part of our brain to process. Investing
quite oen requires contrarian thinking…
doing the opposite.
HIGHER-QUALITY DECISIONS?
eres no cure for heuristics. ese patterns have been
built in to the human brain by 50,000 years of experi-
ences. So, the question is not “How can I avoid making
these mistakes?” You cant; they’re built in to the way
we think about the world and are helpful under certain
circumstances. When it comes to investing, a better
question is “What can I do to make higher-quality
decisions?”
Pay attention to your feelings. Heuristics operate within
the most primitive part of the brain: the part in charge
of survival…the ght-or-ight instinct. When you are
feeling emotional about a decision, that is a good indica-
tor of a heuristic being activated. When investing, avoid
succumbing to emotions and try to recognize that slow,
rational thinking will likely lead to better long-term
decisions.
A comprehensive discussion of Behavioral Finance is
beyond the scope of this article. We are passionate about
the topic and convinced that the mastery of emotions
will have a far greater impact on long-term investment
decisions than anything that can be found in a spread-
sheet. We hope you enjoyed this introduction. Stay calm
and invest on!
27
continued from page 7
CONTROL THE CONTROLLABLE
ABOUT FAIRHAVEN
Fairhaven Wealth Management is an independent, privately owned investment and wealth management rm serving select families and
small to mid-sized businesses. At Fairhaven, our commitment is simple – we exist to serve our clients…period. Our culture of service
and accountability combined with prudent risk management and tax-eciency are the cornerstones of our client commitment.
www.fairhavenwealth.com
This material has been prepared for informational and educational purposes for our clients and friends. Please consult your Fairhaven Wealth Management professional to discuss how
this may impact your own financial plan and/or investment portfolio. This material is not intended to provide, and should not be relied upon for accounting, legal or tax advice or any other
purposes. Neither Fairhaven Wealth Management nor its subsidiaries or affiliates provide accounting, legal or tax advice. Please consult your tax advisor and/or attorney for such guidance.
Advisory services offered through Fairhaven Wealth Management, an SEC registered investment advisor. Securities offered through Triad Advisors, member FINRA/SIPC. Fairhaven Wealth
Management and Triad Advisors are not affiliated. For a copy of Fairhaven Wealth Management’s ADV Part 2 disclosure document please direct your inquiry to admin@fairhavenw.com.
FAIRHAVEN IN THE MEDIA
In addition to sharing valuable nancial knowledge and education on social media, were
also a frequent presence on radio and TV. Follow us on Facebook and LinkedIn and see
all of our media appearances at ww w.fairhavenwealth.com/media