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Newsletter: 1st Quarter, 2019

Newsletter, 1st Quarter 2019

 

Employee Spotlight: Kylie Felker

Meet Kylie our Chief Operating Officer and Chief Compliance Officer. Don’t let the titles fool you, she also loves early-bird dinners, organizational projects and making lists. When she isn’t creating spreadsheets and solving problems at the office, she can be found eating, traveling and overcommitting. Even though she has an aversion to vegetables, Kylie is never far from her next meal because being hangry is her kryptonite. Kylie and her husband Justin love to travel and have plans to eat their way through Savannah, New Orleans and Hawaii later this year.

As an Ohio transplant, Kylie considers herself a Greenville ambassador and is constantly finding ways to get involved in the community or convince family members to move here. Two of Kylie’s current passion projects are the Emrys Foundation and Mentor Upstate. Kylie serves as the Treasurer for Emrys and has learned a lot engaging with creative writers, poets and artists.

Kylie Felker is the Chief Operating Officer & Chief Compliance Officer at Foster Victor Wealth Advisors. She holds her CRCP professional designation.

 

 

Planner Tip of the Quarter: Does Your Money Have a Job Description?

By: Gordon Gulledge

When it comes to reaching your financial goals, success is often bred by finding balance. Whether it is paying down debt or beginning to save for retirement, the secret lies in finding a middle ground. One strategy, which we speak to daily, is making sure that every dollar has a job description. This means having clarity around monthly inflows and outflows. An effective way to begin identifying ‘your number’ is by using a cash flow analysis. This is useful in categorizing monthly needs, or necessities, while also recognizing the items that tend to occur on a more elective basis.

It is important to remember that everyone has a different set of monthly needs and wants, which is why working through the cash flow exercise is key. By personally revisiting my cash flow exercise on a regular basis, I can maintain a balance in the dollars that are earmarked for expenses and debt reduction, as well as the dollars that are being used for mid-to-long-term goals, such as retirement. By maintaining this defensive-offensive balance, I reduce the worry and fear of labeling each dollar with the same job description.

 

 

Considerations for Long Term Care

By: Cynthia Redding

With the average lifespan continuing to increase year by year, planning for in-home health care, assisted living facilities, and nursing home rehabilitation is a crucial aspect of personal financial planning. Insurance is a practical source of protection against the financial and emotional strain of a long-term care event. Traditional long-term care insurance policies operate by providing a set benefit for a set amount of time.

We have noticed an increasing interest in hybrid policies that combine long-term care benefits with whole life insurance products. This trend is not unique to Foster Victor clients; nationwide sales of life-LTC hybrid policies have increased significantly in recent years. One of the most appealing aspects is that the client is not locked in to a “use it or lose it” product. With a hybrid policy, there is an available pool of money set aside to be used for long-term care needs. If the cash value is not used for this purpose, it is still paid out to the insured’s beneficiaries as part of the life insurance coverage. Traditional long-term care policies tend to have less expensive premiums, but there is typically no residual benefit or return of premium if the long-term care coverage is not used. Another item to consider, standalone long-term care policies often have a narrower window of age eligibility while hybrid policies can start as early as age 18. It is never too soon to start planning, and asset protection can be a crucial tool accomplished by either type of long-term care insurance.

 

 

Kylie’s Fraud Protection Tip of the Quarter

Hundreds of thousands of people call cyber hacking their career. They spend all day trying to procure access to your information. A common misconception is that as soon as a hacker obtains access you’ll know it. Often hackers wait until a larger opportunity emerges to sell or leverage your passwords and personal information. So, even if a zero inbox isn’t your Zen place, we highly recommend deleting unnecessary emails and setting up rules to automatically empty your trash folder. The less information available, the less likely a hacker will stick around until you buy your next house or initiate your next bank wire.

 

Teaching Your Kids About $$$: Lessons Learned From Our Parents

By: Garrett Hyer

Teaching children and young adults about money and finances is often a tricky subject.  When is the right time to start?  What do we discuss?  What is a good first step?  One of my first memories regarding money, was my parents taking me to “open” my first bank account.  As a kid I earned an allowance doing odd jobs around our house, as I grew up that turned into summer’s cutting grass or random projects for our neighbors.  I used to collect the cash from my “jobs” and store it in a wooden box in my room.  That made it easy to access and easy to spend.

This all changed the day my parents took my brother and I to open bank accounts.  We grabbed our money boxes and off we went to the bank.  It was a weird feeling walking out of the bank with no cash and a little plastic card in its place.  I didn’t realize or appreciate it at the time, but my parents helped me open this bank account to create responsibility.  Gone were the days of cash just sitting around, if I wanted to get money, I had to think about getting it from the bank.  This was my first memory of learning about money, and it can be a great place to start with children today.  Have them open their own account, make a deposit and allow them to make some of their own decisions about money while they are still under your roof.  Learning to think about money on a small scale early in life will help build financial responsibility for larger decisions later in life.

Foster Victor Wealth Advisors understands the value of connecting with kids and young adults about finances early.  One way we engage with our client’s children and their friends are through our High School and College Financial Bootcamps.  These are 90-minute sessions where we introduce a wide range of financial concepts in a fun and collaborative environment.  The dates for our 2019 events are as follows:

High School Financial Fundamentals:
Thursday, November 7th from 4:00PM – 5:30PM

College Financial Fundamentals:
Tuesday, December 17th from 3:00PM – 4:30PM

If you have a young adult interested in attending, please reply via email: ghyer@fostervictorwa.com.

 


Kylie’s Compliance Corner

Tired of getting mail from fund companies requesting your vote? Foster Victor will vote proxies on your behalf. Reach out to your advisor, or any member of our team, and we can help give your mailbox a break. 

 

 

How to Retrieve Tax Documents for Investment Accounts

By: Susan Harvell

We know how important and stressful preparing to file taxes is each year. Schwab account 1099 Composite tax forms will be available on the dates listed below. To access these forms online, you can login to the 1099 dashboard found on the statements page of www.Schwab.com.

Important Dates:

February 1-15, 2019

  • Stocks, options and cash deposit interest.

  • This date applies to accounts holding investments for which we have all necessary tax information.

  • Downloads to tax software will be available by February 5th.

February 15-28, 2019

  • ETFs and mutual funds, fixed income, REITs, UITs, WHFITs, suspect securities, and U.S. and foreign stocks that have been reclassified in the past.

Note: Just like in years past your statements and tax documents will be sent via email or US mail.

 

 

Elizabeth’s Reading Suggestions:

Every quarter we select articles that you may find educational and informative.

Has the U.S. economy found a sweet spot? Job creation is soaring, but not inflation

Apple Buyout Targets Could Include Netflix and Sonos, JPMorgan Says

Why China’s Under Pressure to Make a Trade Deal

 

 

As Goes January, So Goes the Year

By: Peter Nielsen, MBA, CFA®

How can one month mean so much for annual returns? No one knows for sure, but if January finishes higher, it bodes well for stock investors. Over the last 70 years, when the markets end up in January, 83% of the time they are higher for the year. Of the eight times that the indicator failed, four were in years hit by a recession.

Since its formal inception in 1972, the January Barometer has investors looking closely at daily returns as each January progresses. While it doesn’t have an unblemished track record, it is one that is not wise to bet against. Academics reason that January represents a new tax year and that capital to be invested in the new year will probably hit in January.

Stock prices were depressed by investor angst in the latter months of 2018. Perhaps it is no surprise that they have rebounded in January 2019. However, ending January with the S&P 500 Index up 7.9% provides an encouraging outlook.

 

 

How much of your Social Security Benefit is taxed?

By: Robert T. Coleman IV, CLTC®, CLU®, CFP®

As our clients approach retirement, we get a lot of questions on how much of their social security benefit will be taxed.  There is a lot of confusion around the actual calculation and what sources of income are included in the calculation.  However, generally speaking, the higher your income, the more taxes you will pay on your benefits.

To determine how much of your Social Security will be taxed, you first need to calculate your provisional income. Provisional income equals your adjusted gross income plus tax-free interest from municipal bonds plus 50% of your Social Security Benefit.

If your provisional income is less than $25,000 on a single return (or $32,000 if married filing jointly), then your social security benefits are not taxable. If your provisional income is between $25,000 and $34,000 on a single return (or $32,000 and $44,000 on a joint return), then up to 50% of your Social Security benefits may be taxable. If your provisional income is more than $34,000 on a single return (or more than $44,000 on a joint return), then 85% of your benefits may be taxable.

The calculation above only applies to federal income taxes. Luckily, South Carolina does not tax social security benefits.

 

 

Rand’s Quarterly Fund Digest:

MFS International New Discovery
Ticker = MIDAX

Sector is International Developed Markets

Morningstar Analyst Rating is Silver

Fund Managers & Process – This fund’s team divides portfolio responsibilities by regions. David Antonelli, who picks stocks across all foreign regions, joined MFS in 1991 and has 30 years of investment experience. He was at the helm when this fund opened in 1997 and was the sole manager for several years. (He and two other comanagers run Bronze-rated MFS International Growth using the same stock-selection strategy as here.) Peter Fruzzetti, who selects names in Europe and Japan, has been a comanager since 2004. He joined MFS in 2000 and has 24 years of industry experience.

Jose Luis Garcia, who chooses issues in Latin America, has been a comanager since 2007. He joined MFS in 2002 and has 23 years of investment experience. Robert Lau, who picks stocks in Asia ex-Japan, has been a comanager since 2008. He joined MFS in 2001 and has 24 years of industry experience. Garcia and Lau run Bronze-rated MFS Emerging Markets Equity using the same stock-selection strategy as here.

The four managers focus on firms that can deliver sustainable above-average growth across full market cycles. They also look for clear and durable competitive advantages, good free cash flows, solid balance sheets, and strong management teams. They want their picks to be attractively priced, and they use a variety of valuation metrics, including discounted cash flow models, sum-of-the-parts analysis, and price multiples, to make sure that they are.

Historical Performance – The fund Has outperformed the benchmark MSCI ACWI ex-US Index in 9 of the last 10 years.

 

To see more about what FVWA is doing in the community, check out our Instagram!

Faith Zane

Faith ZaneTEST

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