4 Ways to Avoid Common Investor Biases

February 1, 2019 Dustin Sobolik - Investment Officer

It may stun some folks, but successful investing often relies more on managing emotions than on managing the market. I’m emphasizing this even after analyzing fund and macroeconomic data for the last three hours. Our biases and emotions play a strong role in our investment decision-making, often to our detriment.

Let’s start with recency bias, also known as, “markets are falling and they will continue to fall because they just fell.” It also happens to be my girlfriend’s bias toward my cooking. Just because I burned spaghetti 10 times in the past doesn’t mean I will burn spaghetti 10 times in the future. (Okay, I might.) However, it does apply to investing and the markets. This is also called zoom theory. It’s the tendency to overweigh recent experiences when forming a view of the future. It’s why folks think they can tolerate risk when returns are strong, only to sell when asset prices fall. They zoom in. Let’s zoom in on the most recent sell off for an example:

HTC Team News and Honors

February 1, 2019 Heartland Trust

We are proud to be a Premier Partner with the FMWF Chamber for 2019.
Jon Benson, Trust Officer, is a past president of Hospice of the Red River Valley and is currently on the Board of Directors.
Steve Halverson, chairman of the board, currently serves on the FMWF Chamber of Commerce Board of Directors as a member at large.
We celebrated the holiday season with a Christmas party at the Plains Art Museum, complete with a white elephant gift exchange and pottery making class.
- Gary is going to get a lot of use from his gift.
- Jana, Kevin, and Mary are now expert potters.

Meet Kayla Kranda

February 1, 2019 Heartland Trust

Kayla Kranda is an Operations Associate at HTC. She oversees our trust accounting software and makes sure everything balances. Kayla enjoys spending time with her family and friends and is an avid football fan.

Tell us about yourself.

I grew up in Tappen, North Dakota, and graduated from Minot State University with a bachelor of science degree in finance. I have been in the financial services and banking industry for over 15 years. Currently, I live in West Fargo with my husband, Kyle, son Karson (2 1/2), and daughter Kora, who was born at the end of January.

Patience Is a Virtue

February 1, 2019 Jace Gilleshammer

Everyone has heard the saying “good things come to those who wait” or maybe you’ve heard of the marshmallow test given to children. Likewise, delayed gratification is a major part of investing. Chasing an asset class that just had a winning period or selling one that experienced a losing streak can wreak havoc on a portfolio.

The current volatility in the stock markets reminds me the value of having a game plan and sticking to it. No asset will go up forever; almost everything is cyclical. If you are patient and stick it out, however, odds are the outcome will be positive. If you go back 10 years ago, the unpredictable asset class was housing and, eventually, the entire stock market. About 20 years ago it was the technology sector. At those points in time, if you got out at the bottom and didn’t get back in in a timely fashion, you may still be feeling the effects.

Updating Our Software to Serve You Better

February 1, 2019 Heartland Trust

Technology is always changing. To keep clients and employees satisfied, businesses need to strike a balance between staying up-to-date without constantly changing the way business is done. At Heartland Trust Company, we are always looking for ways to improve our technological footprint while keeping your information secure.

In 2018, we transitioned to new trust accounting software. Our entire team took on hours of extra training to learn the new software before the conversion. So far, the transition has been very successful. Our clients have access to a secure, user-friendly, and robust program with many new and exciting features. Our staff has new tools to streamline processes and serve you better.

Tips for Protecting Your Identity

February 1, 2019 Monica Millette, QKA® - VP, Manager -- Retirement Services.

Data breaches seem to be inevitable these days. When they happen, your personal and financial information can be compromised leaving you feeling vulnerable. While you can’t control the manner in which your personal data is safeguarded by others, you can make it more difficult for criminals to use your personal information to cause you harm.

Most companies must first view your credit report prior to extending credit. With that in mind, freezing your credit may be one of the easiest ways to protect yourself against identity theft. By putting a freeze on your credit, you restrict access to your personal information thereby preventing thieves from opening new accounts in your name.

Famous People Who Failed to Plan Properly

February 1, 2019 Broadridge Investor Communication Solutions

It’s almost impossible to overstate the importance of taking the time to plan your estate. However, a 2017 survey from Caring.com estimates only 42 percent of American adults have a will or estate plan. Over 80 percent of those 72 and older have made these preparations, but that number drops significantly with younger demographics.

You might think that those who are rich and famous would be way ahead of the curve when it comes to planning their estates properly, considering the resources and lawyers presumably available to them. Yet there are plenty of celebrities and people of note who died with inadequate (or nonexistent) estate plans.

COLA Limits for 2019

February 1, 2019 Jana Samek, Relationship Manager – Retirement Services

The Internal Revenue Service and the Social Security Administration have announced the cost of living adjustments (COLA) applicable to dollar limitations for retirement accounts and the Social Security wage base for 2019. Many of the limits have changed for the 2019 plan year. Changes for 2019 are in bold in the chart below.

IRA and SIMPLE plan limits are both up $500. The annual IRA limit is now $6,000 (catch-up remains the same at $1,000 for those 50 and older) and the SIMPLE limit is $13,000 (catch-up remains at $3,000).