News & Insights

Dear Clients,

I have a favor to ask.  If you have a minute and the inspiration strikes, would you please reach out to me with any anecdotes or observations about how money has affected your family, for better or worse?

I’m particularly interested in relationships between parents and kids, something from your own childhood or something you encountered while raising your kids.  Don’t feel constrained though because relationships with siblings or extended family are complex and interesting too.  Anything goes.  You can anonymize your feedback as much as you like, although I’d point out that we never share our clients’ personal information anyway.

The line, “Sell, Mortimer!  Sell!” comes from the iconic 1980s movie, “Trading Places,” where the film’s heroes, played by Eddie Murphy and Dan Aykroyd, get the better of villains Randolph and Mortimer Duke while trading orange juice futures contracts—which is yes, a real thing.  In the pivotal scene, Murphy and Aykroyd have duped the Dukes into thinking they received an advance copy of the government crop report indicating there will be an orange shortage, meaning the price of orange juice will go higher once the report is officially released.  The Duke brothers, believing they have an information edge, place bets on the price of orange juice going up.  When the actual crop report is released it indicates instead that oranges are plentiful, the price of orange juice futures drops like a rock and the Dukes realize they’ve been had.  In the panic to unload their position Randolph Duke directs his brother to, “Sell, Mortimer!  Sell!”

President Trump often announces his policy interests through twitter.  Last August 17th he tweeted this:

“In speaking with some of the world’s top business leaders I asked what it is that would make business (jobs) even better in the U.S. “Stop quarterly reporting & go to a six month system,” said one. That would allow greater flexibility & save money. I have asked the SEC to study!”

It was later learned that the idea for dropping quarterly reporting came from a conversation with former Pepsi CEO Indra Nooyi that focused on ways to improve job growth.  Mr. Trump was quoted in the Wall Street Journal of semi-annual reporting: “I thought of it.  It made sense.  We are not thinking far enough out.”

The end of the year is a great time to review your finances.  Whether you’re still working or retired, there are changes you can make to ensure that you’re not leaving any money on the table.  These changes can help reduce your 2018 taxes and set up for a more financially sound 2019.  It might seem easier to procrastinate and push these financial decisions into the New Year.  However, timing is important when it comes to making some of the tax-related adjustments, many of which have a deadline that must be met by December 31.

No one likes to think about their demise.  However, like Ben Franklin’s ubiquitous saying goes, nothing in this world is certain except death and taxes.  This Viewpoint is a practical warning about steps you need to take, or need to have your elderly parents take if you are fortunate to still have them with us.

Without proper planning, successor trustees or executors could spend 6-9 months of their lives dealing with dozens of insurance companies, mutual fund providers, brokerage firms, and transfer agents in charge of dividend reinvestment programs (DRiPs).  Each firm has its own terminology, policies and procedures, and paperwork.  Many of these forms need to be notarized, have signatures guaranteed, or even have them “medallion guaranteed.”

The massive Equifax data breach occurred approximately one year ago, resulting in the theft of Social Security numbers, birthdates, names, addresses, and in some cases driver’s license numbers.  The number of individuals involved was staggering, nearly 147 million.  Shortly following the breach, Scott wrote a Viewpoint outlining potential countermeasures for individuals interested in protecting themselves from identity theft.  Not to fully rehash these alternatives but they included placing a fraud alert on your credit file, the use of a credit protection service, or a credit freeze.  Scott’s article is still accessible on our website, and given the prevalence of credit fraud, the use of one of these alternatives is worth strongly considering.

Although we consider ourselves money managers, not experts on taxes or charitable giving, we think our clients should be aware of a potential tool for optimizing tax and gifting strategies.

Donor-Advised Funds (DAFs) are charities whose purpose is to help donors give money to other charities.  They have existed for over 80 years and have recently enjoyed a surge of popularity.  DAFs are similar to private foundations in many ways, but they offer a cheaper, more accessible alternative for the 99.5% of people who don’t have the wealth or the energy to organize and administer their own foundations.