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How Middle East Conflicts Have Historically Impacted Markets

On the morning of Saturday, October 7, Hamas launched a surprise attack on Israel killing hundreds and plunging the region into further conflict. Israel immediately declared war on Hamas, responded with air strikes, and called up 300,000 army reservists. The U.S. and many U.N. Security Council members have condemned the attacks by Hamas, which is designated a terrorist organization by many major countries, and are providing assistance to Israel including the positioning of a U.S. aircraft carrie...

Incentive Stock Options (ISOs)

Incentive Stock Options (ISOs) are a common form of incentive tied to the equity of a private or public company. ISOs provide employees with the opportunity to purchase company stock at a predetermined price, known as the exercise price. Although ISOs present a great opportunity to participate in the success of a company, there are some aspects of this type of compensation that can present additional complexity.Tax TreatmentISOs are subject to specific IRS rules, and not all employees are eligib...

Navigating Medicare, Supplemental Insurance, and Travel Coverage

With healthcare expenses on the rise, understanding the intricacies of Medicare, Medicare Supplemental Insurance plans, and the benefits of travel insurance coverage is essential. Medicare: Your Foundation for Health CoverageMedicare serves as the primary health insurance for eligible individuals aged 65 and older in the United States. It consists of four parts:Part A (Hospital Insurance): Covers inpatient hospital stays, skilled nursing facilities, hospice care, and some home health servic...

Saving for College: The Benefits of 529 Plans

As the costs of education continue to increase at exorbitant rates, helping your loved ones save for college is one the best ways to help them secure a bright future. Setting up a College Savings Plan, commonly known as 529 plan, is one of the best options for achieving this goal. Here are the key benefits of using a 529 plan:Tax Advantages: Earnings in a 529 plan grow federally tax-deferred, and no federal or state tax is imposed on distributions used to pay for qualified expenses, which a...

The Small-Cap Advantage

While large-cap (capitalization) companies might grab the headlines, the benefits of investing in small-cap companies should not be overlooked. Small-cap companies are businesses with market capitalization ranging from a few million to a few billion dollars. They are characterized by their growth potential, nimbleness, and the opportunity for significant market out performance.Let us break down the benefits:Growth Potential: Small-cap companies often operate in niche markets, with ample room for...

RSUs

In this month's newsletter, we will be discussing the common tax and financial planning considerations that arise with RSUs, or Restricted Stock Units. RSUs are a popular form of equity compensation that companies use to incentivize their employees. While RSUs can be a great way to motivate and reward employees, they come with their own set of challenges. Unlike stock options, RSUs don't give employees the right to purchase company stock at a specific price. Instead, RSUs are a promise from the ...

How to Teach Kids About Money

Recently after asking what I do for a living a 4th grader told me if he had a million dollars, he would buy a limousine full of candy. The comment, although amusing, prompted me to think about how kids learn about money at school and inspired this month’s newsletter topic.The financial acumen we adopt as children can have a significant impact on our financial decision making as adults. If you have a child, grandchild, niece, or nephew in your life here are some tips to make money conversations...

Navigating Risks in our Financial System

For many of our clients the recent failure of Silicon Valley Bank (SVB) hit close to home. While still evolving, there is plenty of speculation as to what might come next. One recent development is that government officials from the Treasury, Federal Reserve, and Federal Deposit Insurance Corporation (FDIC) have announced that depositors will be made whole in an effort to restore confidence.The collapse of Silicon Valley Bank (SVB) was the first FDIC-insured bank failure since 2020 and the secon...

Q1 Market perspective

While major stock market indices have rallied this year, investors continue to receive mixed signals from the economy. On the one hand, inflation is improving which has allowed interest rates to stabilize at a lower level. On the other hand, last week's jobs report was a significant surprise to the upside with 517,000 net new jobs created in January and the unemployment rate falling to 3.4%, the lowest in over 50 years. Although the inflation data suggest the Fed could slow or pause its rate hik...

Secure Act 2.0

The Secure Act 2.0 is a piece of legislation passed at the end of 2022 that changes several retirement plan rules with the objective of increasing the savings rates of American households.The comprehensive list is long so here are the highlights:Retirement Plans:RMD (required minimum distribution) ages have changed to 73 for individuals born between 1951 and 1959 and 75 for those born in 1960 or later. IRA owners can still do a QCD (qualified charitable distribution) starting at age 70.5Starting...

Year End Tax Moves

Here is a list of our favorite tax strategies to consider: 1. Charitable Giving: Contribute cash to an eligible 501(c)(3) charitable organization before year end to qualify for a deduction of up to 60% of AGI (adjusted gross income) or contribute non-cash assets for a 30% deduction against AGI. If you are subject to Required Minimum Distributions (RMDs) from your retirement plan consider a qualified charitable distribution (QCD) directly to a charity from your retirement plan. 2. ...

ESG (Environmental Social Governance) Newsletter Edition

Green Bonds 101 Investments derived out of concern for climate change and the accelerating adoption of alternative energy have grown significantly in popularity. Caveat emptor (buyer beware): not all investments labeled “green” are worthy investments. Although the consensus is that green bonds have proven their value; the industry is still deciding how that value is calculated, reported, and standardized. What is a Green Bond? Green bonds allow companies and governments to raise capital for ...

Market Update

Global markets pulled back again last week following the Fed's announcement that it would tighten by another .75% and keep rates higher for longer. Major indices are back to their June market lows with the S&P 500 falling 23% year-to-date and the Nasdaq down 31%. Bonds have also struggled as all interest rates have jumped, with the 2-year Treasury yield rising to 4.2% and the 10-year to 3.7% - the highest levels since 2007 and 2010, respectively. Investors have been navigating this challengi...

The Healthcare Cost Challenge

There is consensus across a number of studies that the United States spends twice as much as comparable countries on healthcareHow can you prepare for rising healthcare costs?If you are healthy…Group plans through your employer are less costly than private insurance. You may choose to elect a high deductible plan (HDHP) if you are a healthy individual. A HDHP will give you the ability to save pretax into a tax deferred health savings account (HSA). HSA limits for 2022 are $3,600 per year ...

Stay Invested. You won’t regret it.

The market is unpredictable. You are probably feeling a little anxious about current market volatility and headlines. I am here to reassure you with a few key data points that may put your mind at ease.While bear (negative) markets are unavoidable, bull (positive) markets are much longer with larger returns.Since 1956, the average bear market has lasted one year two months with a decline of 36%.In contrast, the average bull market lasts 5 years 9 months and returns 192%.Recoveries from market lo...

Are you vacation ready?

With summer approaching you are likely thinking about what beach to escape to or European city you want to explore. Making travel plans can be time consuming and expensive. We have compiled a list of 5 travel hacks sure to make your experience more pleasant and less expensive!Use a rewards card- Credit cards can be a great way to accumulate points and perks for travel. Many cards offer large one-time incentives to sign up and the perks far outweigh any annual membership fees. The Platinum A...

Looking for safety?

Is this a track from the 1980s? Current inflation rates are certainly taking a page out of the 1980s playbook. The Bureau of Labor Statistics estimates that inflation was at 6.9% in 2021. Inflation is back but not for the same reasons as the 1980s. A combination of easy money policy, government spending, supply chain issues, energy economics, as well as post covid spending are all contributing factors.The shock of inflation has forced the Fed to make some aggressive monetary policy moves. The Fe...

What does war and geopolitical risk mean for my financial plan?

Headlines, trends, conflict, and the natural progression of the economic cycle can leave us wanting to get off the sometimes-wild ride of equities. In uncertain times, we should take a step back and reassess our financial priorities and take stock of true economic impact. The events unfolding in Ukraine are tragic. The implications of this war will have long-lasting humanitarian and economic consequences. Our modern-day view of globalization is forever changed. From a real economic output perspe...

Tax filing checklist

The basics:W-2 forms 1099-MISC forms for independent contractor income 1099-G forms for unemployment income, and/or state or local tax refunds 1099-INT, 1099-DIV for interest and dividend income 1099-B for capital gain/loss Most CPAs will ask for a copy of last year’s tax return Record of estimated tax payments (if applicable) Retirees:SSA-1099: Social Security benefits received 1099-R, Form 8606 for payments/distributions from IRAs or retirement plans Business, Property & Miscellaneous:1099-S...

Get a handle on current market volatility

The ebbs and flows of the market, although uncomfortable, are a normal part of the economic and market cycle.So why does this feel different? Despite some setbacks at the onset of the pandemic, US equity markets in recent history have been consistently positive. The last significant shock to the financial system occurred over a decade ago. Think back to the financial crisis. That is the last time the S&P 500 had losses in one year (2008) of over 30%. Since then, there have only been two yea...

Reducing Financial Anxiety

A New Year can be exciting but daunting for many as the reality of financial burdens set in. Financial stress is defined as the emotional tension and helplessness one can feel specifically related to money matters. Financial stress can lead to strains on your relationships, depression and anger.So how can we better prepare for and cope with financial stresses as they come our way? 1. Align with your partner on spending and savings goals by being transparent. As you create a plan provide for some...

Giving Tuesday

I personally love Giving Tuesday because it puts the spotlight on organizations that are left out of quarterly earnings calls: nonprofits. It is not always easy making a list of nonprofits to donate to. In the theme of giving back this Tuesday I want to provide some helpful tips. Often, there is hesitation when making gifts to charities because we don’t know where to give or assume the amount is not significant enough — but what I love about numbers is that it is not about the amount tha...

Protecting your family through uncertainty

A common question I get from clients, centers around their need for life insurance. The answer depends on a variety of factors including dependents, income, total assets, and liabilities. For clients in their 20s to 40s life insurance is a tool to replace income and payment of debts. A household with one bread winner, young children, and a mortgage has the largest need for insurance. Premature death can cause financial ruin for many families. Start with maximizing the insurance provided by your ...

Understanding inflation headlines

Inflation is nothing new, but has been the focus of recent financial headlines. Historically the price we pay for things increases over time. In 1970 the price of a candy bar was 10 cents, in 1980 an average model car would cost you $7,000. So what causes the price of goods and services to creep up over time? There are a number of factors that contribute to inflation. First, is an increase in production costs. Production costs could include the price of raw materials, increase in wages, or trade...

Understanding Shareholder Advocacy

The interest and investment in Sustainable and Responsible Investing (SRI) has grown tremendously in the last decade. Environmental, Social, and Governance (ESG) funds received an inflow of $51 billion dollars in new money last year. As advocates of this strategy may already know, the shareholder advocacy approach focuses on leveraging the power of stock ownership in publicly traded companies to encourage environmental, social, and governance awareness and action. Shareholder advocacy has been a...