Fiduciary

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Certified Financial Planners must abide by the fiduciary standard.  Not all financial advisors do.  What is it?  What does it mean?

Terminology: “Fiduciary.”

One who acts in utmost good faith, in a manner he or she reasonably believes to be in the best interest of the client. A CFP® professional must at all times act as a fiduciary when providing Financial Advice to a Client, and therefore, act in the best interest of the Client. In this regard a CFP® professional must:

Duty of Loyalty:

  1. Place the interests of the Client above the interests of the CFP® professional and the CFP® Professional’s Firm;

  2. Seek to avoid Conflicts of Interest, or fully disclose Material Conflicts of Interest to the Client, obtain the Client’s informed consent, and properly manage the conflict;

  3. Act without regard to the financial or other interests of the CFP® professional, the CFP® Professional’s Firm, or any individual or entity other than the Client, which means that a CFP® professional acting under a Conflict of Interest continues to have a duty to act in the best interest of the Client and place the Client’s interest above the CFP® professional’s.

Duty of Care:

A CFP® professional must act with the care, skill, prudence, and diligence that a prudent professional would exercise in light of the Client’s goals, risk tolerance, objectives, and financial and personal circumstances.

Duty to Follow Client Instructions:

A CFP® professional must comply with all objectives, policies, restrictions, and other terms of the Engagement and all reasonable and lawful directions of the Client

In honor of Jane Bryant Quinn

Jane Bryant Quinn has been a personal financial journalist I have admired and respected over the years. This month she has retired. I thought I would share some of the resources she recommends as a tribute to the woman who has meant so much to me:

Here are links to free resources that Jane Bryant Quinn has found to be helpful:

Take an Extra Moment and Get Unexpected Benefits

Yesterday in the midst of travelling home after a lovely weekend with friends. I stopped to grocery shop at a Market Basket just off the highway. I do that because the pause breaks up the long drive but most importantly, it’s a great place to shop. – Great prices and lovely employees. (I never mind giving a plug to a business I admire.)

This was a quick shop as I was trying to get home before the early darkness of the time change. One thing on my mental and empty stomach list, was an already cooked chicken. They do a great job and I knew I was not up to cooking when I arrived home. And I am always up for eating!

I was disappointed to wheel my shopping cart by the warming spot and find no chickens – only cooked chicken legs – not nearly enough to feed my husband and myself. I did the rest of my shopping and swung back by the deli area to find still no chicken! My dinner plans will have to change. I paused in thought and considered asking the busy deli men behind the counter if there were more chickens anywhere. I decided to just skip it and head to check out.

When I turned around, I found another woman looking forlornly at the empty warming shelf. She said, “No more chicken? How disappointing!” I smiled, looked at her and said, “My thoughts exactly. I was just thinking of asking them if more were coming out. Would you like me to do that?”

“Oh, that would be great!” she said with a big friendly smile. The harried man behind the counter told me more were coming. Still considering the mountain roads ahead, I asked how soon – “They are just taking them out of the oven,” responding as if he had answered this question twenty times already. I can wait I thought. And I responded to the lovely lady that they were on their way.

The small dog in the child’s seat in basket was a perfect conversation starter. The red plaid flannel was covered with security dog. I asked about the animal. Another women approached and asked if she could pat the dog. “This is not my dog, it is my husbands. He is away. “ She started to educate us. “The dog is because he is deaf and assists him in hearing everything from the phone to the doorbell or alerting him to safety issues.”

I had never heard of a hearing dog and had many questions. It was fascinating! The dog could even tell when his migraines were coming on. She spoke of other dogs that helped with diabetes and epilepsy as well as other ailments. We marveled at the miracle of animals natural senses. They are so attuned and aligned with nature. Our conversation meandered from there about Maine – where I had just come from and where her husband was hunting, to maple sugaring because “Sugar” was the canine’s name to just smiles of understanding of the woods and beauty of nature.

Linked by chicken, we could have stood there all evening. After everyone else had wandered away and we had introduced ourselves, I started to think I would not be having any chicken for dinner. I told her I may need to give up and she said she would do her shopping and circle back. “But wait a minute, “She paused, “I’ll ask this time.”

My co-conspirator in chicken snatching, Dawn, was assured they were just labelling the chickens and our conversation continued. She was glad she was not going to have to cook something as now she had more time to read! So we were off on the pleasures of a good book… We could smell the chickens before they appeared. Our wait was so worth it. The young man informed us they could not keep these on the shelf. He was only carrying six.

I was so glad I waited. My heart was smiling as I parted from my new fleeting friend and headed to the checkout. I got my chicken – hot and fresh from the oven. But I got so much more from that moment. A wonderful connection. Education on hearing service dogs. And a recommendation for a great read for an upcoming flight! Take an Extra Moment this week. One never knows what goodness and smiles will come from the pause in your busy life.

Remembering Anne Frank

“Despite everything, I believe that people are really good at heart.”
— Anne Frank
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The Hidden Staircase and Anne Frank’s memoir will in my mind for a long time. Today is the anniversary of Anne Frank starting her diary and I got to thinking…..Her book may have begun my fascination with World War II stories. Not the battles or the war strategy. The stories. The people who lived through it. Whether they were on the front lines seeing action, living in their hometown in terror or taken as POW or worse to concentration camps, I read them all.

What I am searching for I do not know. But the tales of resilience and strength and human kindness in the midst of brutality somehow empower me to live on. These people no matter where they were or which side of the war, had parents, spouses, lovers, children and family. In their dire circumstances, they built family. They persevered beyond some things humanly inconceivable.

I never thought about going to Anne Frank’s house when I read the book. I envisioned the house. The house that was so far away in a foreign country that no one I knew had been to. I had the canal and brown clapboard house clearly pictured in my mind.

Then, three years ago, I found myself in Amsterdam. Her very city. Where Anne Frank lived. That was simply amazing to think about. More than forty years before I had read a book that changed my thinking and shifted me into much more appreciativeness. And now I was walking the streets of Anne Frank.

I went to her house. And there it was along a canal: brown and nondescript. Walking up the hidden staircase, gave me an airy feeling – it wasn’t the steepness or the narrowness – it was what these stairs had seen and who had walked there. I was just a tourist, a passerby but so many had paid dearly by walking these stairs.

Nothing prepared me to enter the attic rooms themselves. They were left as they were in the forties. Peeling wall paper. Bare minimum necessities for even that time. The iron sink and sparse décor. A whole life was lived here. Many lives were lived here. The rooms were decent size until you consider who lived there. And how long they had to stay put in a handful of rooms.

When I got to Anne’s room, I felt reverent. Here is a young girl, an author who held strong and focused on something beyond her current situation. She shared her story. She dreamed of a future. She made her best of her time hidden away. I was honored to share the space she had lived, written and slept in.

I wondered who had turned them in. And why? For food? Benefits? Life? Whatever it was, that was their story to tell. Their life to live. I can only imagine what strain brought them to that point in life. Where they were willing to trade a handful of people for something, anything.

Like so many, I wonder what would have become of Anne Frank had she lived. That was not to be. A blessing that her Dad lived and had the foresight and tenacity to get her diary published. That may be the only thing that saved him through the postwar years of loss and loneliness. I bless the woman who saved their personal items and Anne’s diary. She loved them and remains nameless as far as I know in all this. But that is the human side of the story. There is a human side in every WWII story. And I continue to treasure humanity. An anniversary of hope is worthy of mention.

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Have You Checked Your Estate Plan? Details Matter...

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The teller handed me the paperwork and I left the bank with a smile.  Mission accomplished.  I was taking care of the details in life.

I felt great.  I was at the bank to set some money aside in a certificate of deposit.  They had a special interest rate.  The term was just about the time I would be buying a new car so this was a great opportunity for me. 

I had withdrawn funds right from my checking account to open the cd. So I was thinking it was more a transfer. Then, I signed the prepared paperwork and headed home.

Here is the thing.  None of us are perfect.  And certainly I include myself in that fact.  So it was not until an hour later when I was telling my husband what I did, that I pulled out the paperwork to look more closely.  The cd was opened in my name.  My name alone.  Oops!  That was wrong for two reasons.

First, no one but me could access it if I was to get injured, die or disabled and needed the money.  This was not a good plan for the realities of life which I discuss often.

Second and most important, if I did die, this money would go through probate court, delaying my estate settlement.  I can hear someone now saying: “Who cares? You will be dead.”  But I do care.  You see, my husband and I spent money and time making sure our estate plan and the documents were in order.  All of our bank accounts were either in joint name or the name of our irrevocable trusts.  Now, there was one outlier and I had caused the issue.  This Certified Financial Planner had goofed.  I signed documents without thinking it through and confirming the title of the new certificate of deposit.  I saw my name and signed.  I had also made an assumption that the new account would be in the same title since I just transferred the money in.  I know better.

Verify. Verify.  Verify.  I tell clients to do this every day.  And yet, here I was.  Luckily, I had done this mid-day and the bank was still open and I called. Ellen, the teller, was very helpful when I explained the name on the account was incorrect.  She offered to redo the paperwork and call me later in the day to sign it. 

I knew she had the trust documents – so important if a bank or investment company is to put your assets in a trust name.  So at least, I knew it could be simple from there.  Or so I thought. 

Remember, the bank consolidations that have been going on and on over the years since the Great Recession?  Well, this bank had merged five years or so ago.  So now, I got a call from Ellen, telling me the paperwork would take a few days because the system had to be updated at many stages to open the cd on every level.  I almost said I would take the money out and put it in my other bank!  But that was the impatient me speaking.  The part that also was mad at herself for doing wrong.  So I told her to keep me posted. 

That was Friday.  This is Monday.  My task is still not checked off as done.  I’m deflated but grateful to have this opportunity to remind you that if you have an estate plan, be sure you have all your financial business aligned with the estate plan.  If you do not have an estate plan with documents drawn up by a lawyer, get on it.  Sometimes we can all stray, just when we think we are on track. 

 

A Trip to the Actual Bank Anyone?

A Trip to the Actual Bank Anyone?

Making a Difference

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I did not even know that Tom Brokaw was of Irish descent – look it up. But isn’t he right? I mean there are so many ways to make money. And as I reflect on my business career, I realize I chose the path which meant I could help more people. I remember sitting with a colleague, Brian, and saying we want to serve the middle class – that is who needs to hear what we have to say. The wealthy can pay for a host of experts. We can make a difference with the middle class who have never learned money facts.

Speaking is a way to serve many folks of all income levels. Writing is too. Whether I write a blog piece, email newsletter or article, my goal is for someone to learn something. I believe everyone can make a difference. We just need to know where and how our skills can be used to serve.

There is a special lady that you have heard about before, my maternal grandmother, Nanie. She made a difference in so many lives.

Nanie did not have an easy life, but she had a good life. She had five children and seventeen grandchildren. She left Ireland with one sister and one trunk in 1926, never expecting to return.

The very trunk she transported for her travels from Ireland sits in our living room, reminding me of what is possible. For this I am grateful. For her presence and learning at her knee I am eternally appreciative.

I was fortunate enough to give her eulogy. I wondered out loud about her trunk and what she packed in it for a voyage across the ocean from Ireland. What would she take for a lifetime journey? Would it fit in a trunk? More than that, I encouraged her loved ones present to share a bit of her legacy: hospitality, Irish Bread and family traditions. That would make a life well lived.

What difference do you want to make? What do you want to leave behind as a legacy? It may not be the riches you imagine. The wealth is in the lessons and time together. Set your sights on what is essential to your life rather than following a trend.

This St Patrick’s Day, you will find me making Irish Bread and tapping my foot to Irish music. May you too, find some fun and family traditions that bring out the best in you.

Great Financial Ideas Start with a Vision

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“A perpetual holiday is a good working definition of Hell.”

- George Bernard Shaw, The Horror of the Perpetual Holiday, 1914 Parents and Children

This quote should be in every retirement book there is. I know it will be in the book I write. George Bernard Shaw was an Irish playwright among other talents.

He captured the truth in 1914 in this brief saying. He knew something few people know today. The value in life is having something to do and a useful purpose in life. Without that bigger vision, life is empty. My first tag line for my business was, “Great Financial Ideas Start with a Vision.” I still believe that important fact. I encourage my clients to move toward something. This makes your financial life better. Yes, even those who want to get out of debt need a bigger vision than simply the clear task to make it happen. Otherwise, the numbers trip you up because they are not enough. They are only facts. Numbers are not powerful enough to move us to be proactive and consistent. We need a vision of what is going to be accomplished in our life after we are debt free or in our retirement or whatever our goal is.

I first experienced this in my early twenties. Experience is a great teacher. I had reached a milestone in life after college graduation with my first job. Like many millennials today, I was itchy and not content with the 9-5 situation. There was something more I wanted, but I had not even fully conceived of what I wanted for my career direction. I had inklings and I was exploring, but nothing was clicking in.

There was, however, something I always wanted to do. That something was to go out West to live and ski. My roommate was making plans to do just that before she headed to graduate school. She was looking for someone to go with and I quickly volunteered. “But you have a job,” she protested. “I can leave it," I said "I've always wanted to go out West and be a Ski Bum.”

Plans were made and systems put in place. Joining her and then her sister was easy even when a few snags threatened along the way. This was something I really wanted to do.

Being out West and skiing every day was a dream come true. Yes, I worked two jobs most of the time so I was not a true “Ski Bum.” But skiing was the goal. The days were sunny, the snow glorious and the small time ski vibe was perfectly inviting. In summary, I loved it.

I met people at work, in town and on the ski lift. Always practical, I did ask visitors what they did for a living. Being Irish, I guess I had two things going for me: the practical perspective and the gift of gab. I wanted to know if they liked their job and if it was something that might appeal to me. Even as I enjoyed the sunshine and freedom, I was still reflecting on my next career move though I had no plans beyond the next week’s work schedule. Aside from these interactions, the local conversation was always around weather and snow and skiing. And fun.

Then, one sunny day after a great ski morning, I was walking home from the post office and heard the life changing news on January 28, 1986. The Challenger had blown up. I remember being equally stunned by the immense loss of life and the invasion of the “Real World” into this tiny mountain town.

I'd loved the space program ever since I'd visited the location as a child. One could say that I had NASA pride. Added to that was the New England pride of Christa McAuliffe's mission. Christa was from New Hampshire.

Later in the day, I wanted to talk to friends about it. After a comment or two they would change the subject. …”How was skiing today?” “Did you have good runs?” “ Which ones were best?” Another day in a ski town. Short-term pleasure was the focus.

The same happened the next day. No one around me seemed to value the immensity of this loss. I wanted to be somewhere and do something that impacted more than the current day.

At that point, I remembered an older UVM alumni I'd met who was a kind mentor. When I'd told him my parents’ horror of my choice to go West, he'd been so helpful. He had told me at the Parker House in Boston over lunch a few months earlier, “Go and enjoy. Just know when it is time to leave.”

That day in Sun Valley, I decided it was time to leave the idyllic town. It would be so easy to be there still, yet I wanted more out of life than sun, ski and snow. I began to make my exit plans. To where I was not sure, but I knew what did not work anymore for me.

In that short time, as I was in the West less than a year, I learned more than I ever imagined. That took me to an understanding of clients as my career progressed. Because I had lived a semi-retirement of sorts without a bigger vision, I had an understanding of others who inherited money and could do nothing but needed more in their life. None of this made me envious. Rather, it made me thankful for the experience I had out West. Life is multilayered and complex.

This Week's Ups and Downs but mostly Downs

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 This Week’s Ups and Downs but mostly Downs, have many people struck in terror. First of all, as of this writing, the stock market is down 2% for today. Yes, you may say but what about the week? While let’s look at the long-term picture for a better perspective. Since this time last year, the market is up. Not a lot but higher than it was on December 6th in 2017 as far as the Dow Jones and S&P are concerned.

Second, the real question is….How are your investments doing? Technology for example is up. If you have some equity diversity and bonds in your portfolio, the decline of the past few days may be balancing your portfolio to the point where the losses are not so dramatic. Look closer at what you before you panic.

Third, do you have cash? Not just in your pocket but in the bank. Perhaps as part of your asset portfolio where you can access it if you needed. Remembering that cash is one of the three main forms of investment is essential to managing your money. Despite its poor return record of the past ten years, the reason cash is always in style is for its dependability. The currency is always there and insured if parked in an FDIC insured account.

Finally, if you are truly affected in your daily life by the market swings, this is a time for a two pronged improvement to your life. One, take the time to create an investment strategy that matches your age, needs, and personality. Talk to a professional investment person who can educate you and create this for you, before making any changes. Two, do some important work on yourself by finding ways to decompress more in your life. Your health is worth it.

Meantime, know what you can control and cannot. You cannot change the market. You can change your investments. Most of all, you can lower your stress level with some good information.

A Must for Every Investor... Learn about Fiduciary Responsibility

A Must For Every Investor….
Learn about Fiduciary  Responsibility

At first a confusing term, once you know what it means, you can take better care of your money. And you can take better care of others if you are a fiduciary. Most importantly, you can ask the right questions of those who are managing your money.

Investopedia says the following:

“Under the U.S. legal system, a fiduciary duty is the legal term describing the relationship between two parties that obligates one to act solely in the interest of the other. The party designated as the fiduciary owes the legal duty to a principal, and strict care is taken to ensure no conflict of interest arises between the fiduciary and his principal.

In most cases, no profit is to be made from the relationship unless explicit consent is granted at the time the relationship begins. Fiduciary duties come in a variety of forms under the legal system, including but not limited to, trustee and beneficiary, guardian and ward, principal and agent, and attorney and client. “

Read more here - https://www.investopedia.com/ask/answers/042915/what-are-some-examples-fiduciary-duty.asp

Objective Views of Financial Educators

Investment and Financial folks who do act as a fiduciary do not have any issue with this law. Many organizations like the Certified Financial Planning Board are supporters of it. Good financial advice can be given without conflict of interest or high fees.

As the possibility of a law change was being discussed, Jane Bryant Quinn wrote the following piece. It is an older but clearly objective and powerful.

http://janebryantquinn.com/2016/03/brokers-say-theyll-lose-money-if-they-have-to-give-you-better-advice/

SEC Guidelines

No matter what your politics, learn what the Security and Exchange Commission(SEC) is up to when it comes to Fiduciary Responsibility guidelines and laws.

https://www.financial-planning.com/news/warren-chides-sec-on-proposed-broker-standard?utm_campaign=Dec%2026%202018-regulatory&utm_medium=email&utm_source=newsletter&eid=b1f3ad638ceb78d6bc35428398f3aa57

I have and will keep on this subject because it is important. Read more from my email newsletters. Sign up for free here: https://www.moneypeace.com/email-newsletter-archive/

Does Your Mood Match the Market Swings?

This Week’s Ups and Downs but mostly Downs, have many people struck in terror. First of all, as of this writing, the stock market is down 2% for today. Yes, you may say but what about the week? While let’s look at the long-term picture for a better perspective. Since this time last year, the market is up. Not a lot but higher than it was on December 6th in 2017 as far as the Dow Jones and S&P are concerned.

Second, the real question is….How are your investments doing? Technology for example is up. If you have some equity diversity and bonds in your portfolio, the decline of the past few days may be balancing your portfolio to the point where the losses are not so dramatic. Look closer at what you before you panic.

Third, do you have cash? Not just in your pocket but in the bank. Perhaps as part of your asset portfolio where you can access it if you needed. Remembering that cash is one of the three main forms of investment is essential to managing your money. Despite its poor return record of the past ten years, the reason cash is always in style is for its dependability. The currency is always there and insured if parked in an FDIC insured account.

Finally, if you are truly affected in your daily life by the market swings, this is a time for a two pronged improvement to your life. One, take the time to create an investment strategy that matches your age, needs, and personality. Talk to a professional investment person who can educate you and create this for you, before making any changes. Two, do some important work on yourself by finding ways to decompress more in your life. Your health is worth it.

Meantime, know what you can control and cannot. You cannot change the market. You can change your investments. Most of all, you can lower your stress level with some good information.

Don't Count On It!

 “I am going to retire early.  My investments are doing well and I can now, “ another professional said to me.  This plan was relayed to me by over lunch.  Not my client, I did not have to say much in response but “Good Luck.”

In my head I thought of so many other things.  Mainly, does this person have an investment strategy to carry them through thirty years of retirement?

The Stock Market is up.  I am hearing enthusiasm and optimism all around in public.  In private, I hear financial professionals being cautious.  Perhaps no one knows the future.  What is one to do?  There is not a clear and easy path.  Getting educated is a first step.  Second step, dig deeper into your own financial and investment situation before you follow the herd mentality.

This is the ninth year of the longest running bull market in financial history.  Some sharp investors say it will continue.  Others “in the know” say to brace for a down turn.  Either way, this upswing will not last for the decades that the average person will be in retirement moving forward.  Creating a plan based on the good times and bad will be sure to devise a life of leisure without worries. And Peace of Mind.

We have been through this before or I have seen in as a Certified Financial Planner.  At the beginning of 2000, the tech boom was exploding.  The market was up.  Many, many folks retired based on those numbers.  When the bubble burst, those without a long-term plan went back to work.  This was not work by choice but work for cash flow to support their retirement years.   A little foresight can go a long way and prevent a forced return to the working world.

Think about what you can count on in life.  The list may be short.  We used to have pensions for life, some companies gave medical benefits as well, even our weather was a bit more predictable.  Today the world is a bit more complex and your personal situation has to be considered.  Now is the time to get educated no matter how far you are from retirement.

Want to read more?  Read and explore beyond the daily news feed or nightly news.  Here are some places to start:

https://www.cnbc.com/2018/09/20/dow-hits-new-high-amid-five-very-bullish-signals-for-stocks.html

https://www.nasdaq.com/news/

https://www.wsj.com/news/markets

And of course, please read, listen and watch more on my website: www.MoneyPeace.com

A Rainbow Kind of Day......

Amazing! One glance at the sky and I could not stop looking.  The rainbow that greeted me yesterday morning was high, and wide and situated just perfectly for my viewing.    I paused and took the moment to reflect on the beauty before me.  This time of the day I do not typically see a rainbow.  Right or wrong, they seem to me to be an afternoon occurrence. 

What could the rainbow mean?  Why today?  Why right now? The light rain that fell on me was refreshing and matched my thoughts.  This is going to be a rainbow type of day!  I smiled. 

I believe we are all able to put good intentions out there and make the kind of days we want.  Attitude matters as does our intention. 

Smiling, I thanked the universe for the reminder and carried on for my drive through the beautiful roads of Vermont to work. I never saw the rainbow again on my drive.  The smile never left my lips or heart. Rainbows represent so many things to so many people.  There is the LGBTQ movement.  There is the Irish mythology of the pot of gold at the end.  There is the Judy Garland song.  All of them are of hope and possibility.  All of them speak of beauty, of something special.

A couple of hours later, one of my dear clients came in to my office for our meeting.  She had a white paper gift bag that she dropped ceremoniously on my desk. 

“For you,” Patricia says, “I had it made by friend of mine especially.”

Imagine my smile when I opened the bag to a rainbow, a rainbow of peace signs.  I was and am still amazed.  I told her my story of intending to make it a rainbow kind of day.  Her gift radiated beauty of the giver, the purse and the peaceful intention.  I will be telling the story many more times.  I cannot wait to use my new bag!

What is your intention for the day?   Make it a Rainbow Kind of Day!

Stock Market Wave or Wobble?

These are turbulent times.  The stock market is reflective of that on many levels. The average person is watching the financial returns after the stock market “corrected” itself by over 10% on February 8th. A correction is defined by a 10 to 20 % drop from a peak.  The peak of late January was 26,616.  On February 8th, it had the largest one day point drop, losing 1033 points. 

In October 1987, I was in my mid-twenties and working at a large mutual fund company in Boston.      The market dropped 508 points on Monday October 19th.  That was nearly a 22% drop. In a day! There was a sell off across the globe.  The date is now universally called Black Monday.

After that momentous fall when the Dow Jones declined to 1,738, regulators made some changes.  They developed new rules that allowed exchanges to temporarily halt trading if there are large declines.  The idea is to reduce market volatility and prevent large panic sell-offs.  The market can still go down, but more than 20% it will be halted for the day. 

I mention this to add perspective.  Perhaps thirty years ago, you were not invested in the stock market and were not paying attention.  I was because my job was on the line as well as my investments. Now, each time I hear a significant drop in market value, I look to what the percentage of the decline is.  The percentage tells the story.  This is how you should look at your investments as well.   Look at the overall percentages.

We tend to pay closer attention when the stock market goes down then up.  Leading us to be complacent about our investments until something changes.  Fear and loss are strong motivators.

Save yourself some trouble and stress.  Do not watch the stock market every day. There is so much going on in the world complicated by our government, business climate and even Facebook.  There is so much going on for one person to digest and process every day.  Better to turn off the news and take the time to take care of yourself and money for the long-term rather than be reactive in the short term. 

Let the world be turbulent.  You keep yourself on the steady path by managing your expectations, getting educated and focusing on the important things both in and out of the stock market. 

 

Post Script:

When I started this blog post on Friday afternoon, the market was down thirty points.  When I finished an hour or so later, the market was up 40 points.  This on a day the tariff legislation was expected to be signed and cause a market decline.  At 3 pm, I left my office for a couple of appointments.  At the last appointment as it neared 5 pm, a person commented on the large decline on Thursday.

“Did the market do the same thing today?” he wanted to know. 

My response? “ No last I looked it was up a bit.”  An hour later I saw the news.  The market had dropped by 424 points.  In the last hour of trading. This is why predicting its behavior from past actions are difficult, even during one day.  I will note that the percentage drop of the day was less than 2%.   

The Stock Market Continues to Roller Coaster, As It Should. You Do Not Need To...

Thinking, Worrying & Stressing about the stock market? This is the time to fall back to your investment strategy. Don’t have one? Remember have a MoneyPeace safety account and a balance of stocks and bonds for your long term retirement monies. Need money for a home, college or car in the next three years? That money needs to be only invested in an insured cash place.

Learn Something New Every Day....Welcome 2018!!!

“Learn something new every day.” That was heard around our dinner table by anyone who cared to join us for dinner. Some families talked politics, some sports, or world problems. My Dad was a big believer in learning something new every day. Over dinner, he was sure to ask us what we learned. This was not just book learning or school. He was looking for life learning.   As a graduate of the school of Hard Knocks, he realized life skills for what they were: Invaluable. 

Learning something new often means experimenting and being willing to put yourself out there in a different way. Trying something new does not come easily to any of us. Sure, some of us more than others. But all of us had the knack for trying and failing and trying and succeeding as children. I heard last week that as children we are more willing to try things until about age five, at which time we attend school and are taught about the right way to draw a tree or the true colors of the tree. Before we met a rating system, we learned to walk by trying and failing. And trying and failing. Receiving encouragement, trying again. And then, maybe a step or two before we dropped. Only to get up and try again. No judgment, no ratings. We walked eventually.

As I enter the year, I am going back to learning something new every day, but this time not in answer to my Dad’s questions. He has been gone nine years and I sorely miss his wisdom. I'm not going back to this practice because “conventional” spiritual growth says trying the new is good for personal growth. I am going to learn something new every day because--here it is--It Feels Good! I want to feel good, even when I fail and need to try again.

What inspired this blog post and new attitude?  Simple. A freezing cold weekend in Vermont with low motivation for outside activity. I unwrapped an oil paint kit tucked away in the house.  I have never used oil paints before in my life. I have painted once in my life. And I could not even tell you how long I have had the kit. This is not about my memory failing me but since I had to dust the kit off, I only know it has been years.

I sat on Saturday, December 30th, and thought about what to paint. The thing on my mind was 2018. I sketched lightly as suggested by the guidebook accompanying my paints – I did not know that most visual artists sketch first. Then, I started painting. Fun colors. Designs that appealed to me. I mixed some paints together and made new colors. “This was fun," I thought with a smile on my face.

As I moved on, covering more and more of the surface, I wanted to do another layer of paint and merge some colors on the small canvas. Every time I tried, something blurry and unlike what I wanted appeared. So I stopped. I did not YouTube my question, I did not Google it. I went back to that guidebook – yes, someone is still reading books. The thin paperback book explained I would have to wait to do my next step until the paint was dry to the touch. I figured an hour or two. However, further research revealed that I was going to have to wait 16-24 hours for the oil paint to dry. Hmm! I wanted to be finished. 

Instead, I had to clean up. I knew how to clean brushes but admit to texting a friend on how to clean the artist’s palette. My artwork finished for the day, I had time for reflection. Writing is my typical creative endeavor. Breaking out something new felt freeing and fun. What I did not anticipate is that on December 31st, I still would not be finished with my painting project. After a bit of time with the paints, I realized I needed to add the lightness of yellow to my piece. But again, I had to let the current piece dry. Perhaps I am more patient than I thought. Or, I am learning patience in a creative way.

After the final touches on January 1st, I realized something about myself and my own creative work. I always want to power through my writing and get to the finished product. Something worthy of the reader's attention. So I write, I edit, I review and have someone else read a piece through before I commit to the completed piece. What if instead, I let the “paint dry” on my writing? I did not have to commit to hours and hours each day. Rather, I could work when something comes together in my writing and then let the writing sit for a day or two--knowing I will come back to it with fresh eyes and be ready to put the finishing touches on it. 

Yes, I am on to something. I tried something new. A real creative reach for me. And in the process, I learned a new way to approach my first love of writing. The finished art project? You be the judge…

Charitable Giving: Teach Your Children Well

Children can understand charitable giving and helping others.  No age is too young to start.

With your kids of all ages, get them involved.  Create a change jar for giving to charity.  Each month or so decide as a family where to donate the money.  Then, if you want, roll the change or take it to the bank for counting with your child.  Writing a check is great but taking the money to the charity together is a tangible lesson.  Children learn in all ways including seeing and experiencing the location and people you are helping.

Some families donate time together.  They go and work at homeless shelters providing holiday meals or make it a monthly time to support their favorite charity. Making it age appropriate to your children is a perfect hands-on lesson.

My grandmother you to hand me a dollar to put in the basket at Sunday Mass. Yes, this was a start of a lesson.  However, the more intentional and planned and discussed donating is, the better the long-term outcome. 

Yes, as a parent you have plenty on your plate.  Teaching your child about charitable giving is a two for one accomplishment.  You are teaching your child about your values and helping others.  Plus, the giving circle will continue as they practice in future years the giving that you taught them. 

Remember, the dollar amount does not count as much as the action.  The attitude of gratitude is enhanced with giving.

Charitable Giving and RMD's

For those 70 ½ you can give directly to charity with your required minimum distribution.  Why is this important? 

Those over age 70 ½ need to take Required Minimum Distribution (RMD) from their non-taxable retirement accounts.  This means an annual distribution from the Traditional IRA, 401k, 403b or Thrift Savings account that was contributed to with tax-free contributions and grew tax-free.  The RMD does not affect Roth IRAs.

If this means you will be getting a RMD before the year end, consider this – your RMD from a Traditional IRA can go directly to charity.  This is a tax-free transfer if the money goes directly from your IRA retirement account.  This does not apply to your other retirement accounts unless the 401k or 403b is first rolled over to an IRA.

If you tend to give to charity a similar amount to your expected RMD, this type of planning needs to be in your financial tool box.  Not only will it save taxes because the RMD is not counted as income, your income will be lower than if you took the money and wrote the check to charity.  This is critical in planning cash flow because Medicare Part B premiums are based on your income.  Here in Vermont, property taxes are also based on annual income.  Removing income from your tax filing may help you in other ways. 

The law, which allows tax-free transfers of up to $100,000 from an IRA to a public charity is a great opportunity for 2017. Just remember, you will not be able to use the charitable deduction again if you itemized for your taxes.

Move quickly because though this is a possibility for the tax year ending December 31st, your financial institution is busy this time of year.  You will want the request and paperwork to be in process before December 15th to be sure this happens in a timely manner.

Finally, review with your tax advisor to see if this makes sense for you.

Giving In November With Thanks: Finding A Review on Your Charity

How do you know your charity is doing a good job?

Though we are great shoppers, we often do not research the causes we give to.  We are spending time on-line finding the best price, but many donors give without true knowledge of the charity.  Some charities names may sound good and they asked for money, so we give.  Before you give, investigate. 

There are two websites that analyze the charities for their fiscal responsibility and their true nature of helping the causes they represent.  If an organization is spending 50% of their money on administration costs, for example, they may not be the best place to give your donation.  Check out: Charitynavigator.org and Guidestar.org

 

 

Is Your Credit Report Information Breached? Follow These Steps:

What do we need to know about Equifax?

On September 7, 2017, Equifax, one of the largest credit reporting agencies in the US, announced a massive data breach.  The breach had gone on from May thru July of this year.  Personal information of 143 million persons was stolen from Equifax, including 240,000 Vermonters.

Why does it matter?

The pirated data included names, social security numbers, birth dates, addresses, and, in some cases, driver's license numbers.  This is information that could be used to open accounts or file fraudulent tax returns in victims' names.

What can we do?
Everybody –

Step One   Equifax.com

Check if you are affected   Equifaxat www.Equifax.com

The call center is available at 866-447-7559

For more information and backgroundwww.equifaxsecurity2017.com

Those affected-  Enroll in the free Equifax Identity Theft Protection and Credit File Monitoring Services