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Helping you live the best life possible with the money you have!

September 2020

Dear Readers,

In light of recent events, and knowing that 2020 has ticked just about every checkbox on the "Terrible Things That Can Happen" list, we would like to encourage all of our clients to purchase earthquake insurance if they don't already have it.

Wildfire Updates

While Anabel's best friend was on the front lines as a firefighter, Moana was evacuating with her family from Felton to Morgan Hill, and then from Morgan Hill to Riverside, because one evacuation just isn't enough when you have a kid and a cat in the car with you. 

We were grateful and lucky to be able to come back home, but we know many people who weren't. Our hearts go out to those who have lost their homes, and if you need help with things like working through your insurance claim or amending taxes to account for uninsured losses, please don't hesitate to get in touch. Moana is working on a home cleanup this weekend, and if you know anyone else who needs any volunteer labor, just say the word and she'll be there.

There's lots of general information out there already, like the website UPhelp which provides good information on insurance, but locally in the San Lorenzo Valley, we have a support group on Facebook for those who have lost their homes in SLV and anyone who wants to help them. There are also insurance-specific SLV groups so that people with the same insurer can help each other navigate the claims process.

Much like the ancient greek myth of the sunflower who grew two new heads for every one that was cut off *, we will help each other rebuild and come back as a community, stronger than ever.

* I think that's how the myth goes. If not, how do you explain this:

Elections and the Market: What Can We Predict?

One thing that a lot of people have been asking us is how we think the presidential election will affect the market. While it's certainly possible that the election outcome will swing the markets one way or another, it's pretty much impossible for us to tell in advance.

Here's an interesting 4-minute video that shows the relationship between different administrations and how the market performed: What History Tells Us About Elections and the Market

And if you want some more research, here's a bunch of data showing returns during and after election years, during different presidents, and annualized returns by which party controlled the presidency or Congress. Results for elections affecting the markets are all over the place. The overall message, though, is clear: staying invested in the long run will reward you, regardless of who is in charge. 

Natural Bridges Blog Posts

Should You Sell Your Life Insurance Policy?

If you have a life insurance policy you no longer need - maybe your kids are grown and independent, and you're retired - then you might want to sell it.

Back to Basics: 9 Common Insurance Mistakes to Avoid

Choosing an insurance policy that works best for you and your family is worth taking the time and effort to do right.

Natural Bridges Personal Updates

The challenge of growing a garden makes it very hard for Moana to throw in the hose and give up at the end of summer. Being away from the house for a week made this decision a little easier, since most everything was dead when she got back and she didn't even have herself to blame.

One last hurrah from the garden: a few borage plants are still growing, just enough to pick and sugar some flowers for cupcake decorations.  Did you know you can eat borage flowers? They taste like cucumber, which means you can count the cupcakes as a daily serving of vegetables. Stay healthy!

Anabel and I continue our slog towards the CFP exam (it's this month!) For today's peek into our studying, we would like to introduce you to the wonderful world of OPTIONS.

What are options? In simple terms, buying an option gives you the option to either sell or buy shares of a stock at a later point in time, at a set price. 

  • If you think stock prices will go DOWN, you can buy PUT options (think: "telling Moana she's terrible at investing is a real put-down"). 
  • If you think stock prices will go UP, you can buy CALL options (think: "I will call up Moana and tell her I was wrong about her being bad at investing"). 

Buying options is cheaper than actually buying the shares of stock, but you will be paying a premium - and if the stock price doesn't go the way you think it will, your option will expire worthless and you lose all your money. On the other hand, if you are right about which way the stock price goes, you can stand to make a lot more return since options can be highly leveraged.

Does that sound like gambling? Well, there's a reason we've never talked with you about options before. They're a terrible idea! But if you're bored with lottery tickets and roulette, options can be a new and fun way to lose your money. And now we can tell you all about them, as Chris would say, "in nauseating detail".

Chris probably did something this month too but I'm going to be honest with you, with all these numbers floating around in my brain, I can't remember. I'm sure he's doing fine. 

Much love,

Moana and the Natural Bridges Team

This isn't on the highway, I assure you! We let Bean wander around a bit to get comfortable with the car before she snuggled in for the long haul.

P.S. If you know someone who wants to start trading options, send them this newsletter and then smack them upside the head with a trout.

Natural Bridges Financial Advisors

627 Center St, Santa Cruz
California 95060 United States

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