As we take time this week to reflect on all we are thankful for, we want to begin by […]
The Best Market Week Since 1974 (as predicted by nobody)
No one was anticipating the week of April 6th (technically 4 days since the market was closed for Good Friday) would be one of the best in stock market history. Last week, the S&P 500 gained 12.15%, NASDAQ gained 8.9%, and foreign stocks gained 8.3%. This is by no means an indication that we are out of the woods, but another example of the market reacting swiftly and in anticipation of positive news (in this case, planning to reopen the economy). Time and time again, we are reminded that market timing is a gamble and can damage long-term financial security.
We continue to expect volatility as the world negotiates the pros and cons of lifting lockdowns in a world where the virus is still active. Protecting public health will be weighed against the economic impact and there will be setbacks along the way. Maintaining a long-term diversified approach while being careful to plan for short-term cash needs remains the cornerstone of our investment philosophy.
Jeffrey Kleintop and Kathy Jones are two investment strategists we follow closely. We have included links to their latest articles we found of interest:
2nd Quarter Federal Estimated Tax Payment now due July 15
The IRS issued additional guidance moving the due date of the 2nd quarter federal estimated tax payments to July 15th. This now aligns with the due dates of the 2019 federal tax return and the 1st quarter federal estimated tax payment. States have been following suit but be sure to confirm with your tax preparer.
If you have a child receiving reimbursement for room and board expenses not incurred due to COVID-19 shutdowns, you have 60 days from the refund check date to recontribute the funds to the student’s 529 account. Alternatively, you may use the funds for qualified education expenses during the same calendar year. If the funds are not redeposited or used for other education expenses, the IRS may consider the original 529 withdrawal as a non-qualified taxable withdrawal because the funds are no longer being used to cover qualified higher education expenses.
The IRS has established a website for taxpayers to update their direct deposit/address information and check on the status of their stimulus check, which should begin to be distributed Friday. There is also a section for non-filers to enter their payment information to receive their funds. The website is: https://www.irs.gov/coronavirus/economic-impact-payments
Get a CLUE about FDIC Insurance
Lately, we have fielded many questions about FDIC insurance coverage. This topic can be very confusing as illustrated in the following tale by our resident mystery writer, Liam Hurley.
The late Mr. Boddy was discovered by investigators in the kitchen of Tudor Manor, an elegant residence often called Boddy Mansion by local residents. All evidence pointed to Mr. Boddy being bludgeoned by a lead pipe discovered in a corner of the kitchen.
A group of six acquaintances of the late Mr. Boddy have fallen under suspicion. A look into the cash and deposit accounts of Mr. Boddy and his six acquaintances has revealed a complicated web of accounts held at CLUE National Bank.
As the detectives pour over the crime scene, we turn to the question of FDIC insurance for those involved. One of the detectives muttered, “I’m glad we only have to figure out who committed the murder. I pity whoever was stuck with the FDIC mess.”
Here is the status of the accounts just prior to the unfortunate intersection of Mr. Boddy’s head and a lead pipe moving with powerful force and high velocity:
- Mr. Boddy held $1,000,000 in a Revocable Trust he nicknamed “The Candlestick.” His six dear friends, Colonel Mustard, Mrs. White, Professor Plum, Mrs. Peacock, Mr. Green and Miss Scarlett were named equal beneficiaries of his trust.
- Colonel Mustard is a man of means. He has named Miss Scarlet the beneficiary of a $300,000 Revocable Trust nicknamed “The Billiard Room.” The trust nickname and choice of beneficiary should not be discussed in polite company.
- Colonel Mustard has another Revocable Trust nicknamed “The Ballroom.” Colonel Mustard has named Mr. Green, Mrs. Peacock and Miss Scarlet equal beneficiaries of this account. The late Mrs. Mustard would not have been pleased with these choices.
- Colonel Mustard has also named the same unlikely trio of Mr. Green, Mrs. Peacock and Miss Scarlett as the beneficiaries of his $750,000 IRA he termed “The Library.”
- Miss Scarlett will be disappointed to learn that Colonel Mustard also has a $50,000 individual account, which he referred to as “The Study,” that has no named beneficiary.
Fortunately for us, EDIE is on the case (FDIC Electronic Deposit Insurance Estimator)!
Single Accounts (owned by one person with no beneficiaries): $250,000 per ownerThe real crime here is how confusing it can be to solve the mystery of FDIC coverage! EDIE reminds us of the following FDIC insurance guidelines:
- Joint Accounts (two or more persons with no beneficiaries): $250,000 per co-owner
- IRAs and other certain retirement accounts: $250,000 per owner
- Revocable trust accounts: Each owner is insured up to $250,000 for each unique eligible beneficiary named or identified in the revocable trust, subject to specific limitations and requirements
Client Webinar Registration OPEN We are excited to offer our first virtual client webinar on Monday, October 12, 2020 […]