A general mnemonic that is particularly applicable to investment advice.

“I use the mnemonic ‘KISS’ when approaching the addition of new funds/strategies. My primary responsibilities at U.S. Wealth are that of portfolio construction and capital deployment into our models. Asset managers and fund companies have the best stories for why a new niche strategy is a perfect fit within our portfolio’s needs. They often have interesting skews (low volume, small-cap momentum, MOAT strategy, high profitability, ex-state owned enterprises, etc.); however, these strategies are not transparent. KISS is a tribute to broad-based index funds, which allow advisors to construct a portfolio with complete understanding of how a certain fund/asset class will react, while imposing lower expense ratios.” —Thomas Schulte, financial planner at U.S. Wealth Management in Braintree, Mass.

(Pronounced like “snow log”—the first g is silent.) 

“This mnemonic helps me remember not to take short cuts and always look toward long-term opportunities rather than flash-in-the-pan (high risk) greed-based investments. I made it up over a decade ago. The back story is that about 12 years ago I took a deep dive into how someone becomes a decamillionaire ($10 million plus) and maintains these assets for many years. I found 10 different consistent traits. This mnemonic summarizes the central lesson that short-term greed should never outweigh long-term goals. It is used as a compass when assessing business or life decisions. It basically means you have to put in the work; that there are no short cuts; and that you can’t fix a long-term problem with a short-term hack.”—Peter Blatt, president, Center For Asset Management in Palm Beach Gardens, Fla.

W – Withdrawal Rate
I – Inflation
L – Longevity
M – Medical Expenses
A – Asset Allocation

A mnemonic to help advisors remember the “big five” retirement risks.

“The WILMA mnemonic is useful to me because it puts the focus on the risks putting the client’s retirement in jeopardy as opposed to portfolio returns.” —Brian G. Blackwell, director of financial planning, Spotlight Asset Group in Oak Brook, Ill.

A mnemonic from social media that applies to all things financial.

“Are you feeling FOMO or FOLIA? It may be time for a change. FOMO is the Fear of Missing Out or worrying about not participating in a hot investment trend, like when cryptocurrencies or SPACs were peaking earlier this year. The opposite is FOLIA, or the Fear of Losing It All, like how many investors felt at the low point of March 2020, while the S&P 500 has more than doubled since then. Recognizing when you are being especially fearful or greedy is helpful as an investor and it often pays to do the opposite of how you feel.” —Ryan P. Johnson, director of portfolio management and research, Buckingham Advisors in Columbus, Ohio.

From Adam Smith to Milton Friedman, this mnemonic captures an enduring truth.

“I remember learning this term way back in my high school economics class, and it has stuck with me ever since. The mnemonic reminds me that nothing comes for free; everything in life has a cost. Even if you didn’t directly pay for it—whatever ‘it’ may be—the fact is that somewhere in the supply chain, someone else certainly did. In every case, energy and/or resources were used to produce the final result. Ultimately, keeping this mnemonic in mind helps me stay mindful of the costs when it comes to decision-making and consumption.”—Chris Muller, director of audience growth at DoughRoller in Austin, Texas.

A mnemonic to remind advisors not to miss the human element in establishing and maintaining client-advisor relationships. 

“This mnemonic helps remind me to focus on the person first, the numbers second. Have a bowl of candies out for a quick energy boost. Give the prospect a chance to talk. Listen to why they haven’t slept well in weeks. Hearing their story, being sensitive when asking questions and responding empathetically will ground the conversation in their reality, build rapport, and provide the correct strategy or conversation to move forward as a caring, trusted advisor.” —Syble Solomon, president and financial behaviorist at LifeWise Strategies/Money Habitudes in Hamilton, Mont.

Understanding the client’s situation, both quantitative and qualitative.

Identify goals with client.

Analyze current course and potential course of action.

Develop recommendations for client.

Present financial plan to client.

Implement the financial plan and recommendations.

Monitor the progress of the plan and adjust accordingly.

A mnemonic from a CFP candidate.

“I picked this mnemonic up while studying for my CFP exam. I’m not sure who originally made it up, but I’ve found it very useful to keep in mind as I support my team. I love using this mnemonic because it keeps the client’s entire plan in perspective. As we recognize patterns in different clients’ circumstances, human nature wants to rush and apply what we know in one situation to another situation. The mnemonic slows the process down enough to ensure we are evaluating the unique details that come with each client and their beliefs, strengths and weaknesses.” —Jessica McDonald, advisor administrative assistant, RFG Advisory in Vestavia Hills, Ala.

A useful mnemonic for trust practices.

“HEMS is an effective and meaningful shorthand attorneys use to outline the criteria for which a trustee can distribute income and/or principal to their beneficiaries.

We frequently see clients concerned about their future beneficiaries: struggling to balance their desire to provide for them and protect the underlying assets. Irrevocably locking up assets in a trust is scary, and HEMS is a powerful way to break through the fear by simplifying the legal drafting process and easing the minds of clients who want to ensure their children and grandchildren can access the trust assets when they truly need them.” —Steve Wittenberg, director of legacy planning at SEI in Oaks, Pa.

A mnemonic to help clients better understand what they hold/own.

“I use the Three Fs as a quick reminder to dig a bit into the details.

1. Fees: How much does your investment cost? If we are talking funds, what share class? What is the overall management expense? How much does rebalancing cost? Any additional annual costs?

2. Funds: What do you own? Are you U.S., world, large cap vs. small cap? Why do you own what you own? By focusing on what you own, investors begin to think smarter about ESG and other sustainable ideas. 

3. Fiduciary: Is your advice coming from a fiduciary? If yes, why; if no, why not? This section truly homes in on why advice is important to the investor.” —Brian Halbert, vice president, retirement specialist at Pensionmark in Austin, Texas.

Purchasing power risk

Regulatory risk

Interest rate risk

Market risk

Environmental risk

Default risk

Investing involves risk. Doing nothing involves risk. This mnemonic captures the major types of risk.

“Helping my clients understand the types of risk they are exposed to is a key aspect to investing. The mnemonic PRIMED helps me go over the most important risks we talk about.

Purchasing power risk is also known as inflation risk. Regulatory risk deals with changes in the regulatory or political environment. Interest rates have a significant impact on many asset values. Market risk deals with systematic and unsystematic risk. Stated another way, it’s the risk in the market system, as well as the risks specific to that one company. Environmental risk deals with changes in the environment, such as natural resources or climate. Default risk is the risk that a company can go under.”—Matthew Sanchez, private wealth advisor, Biechele Royce Advisors in Fishers, Ind.