Charts & Chat - September 22, 2024

This week, CEO Eric Boyce, CFA discusses: 1. Analysis of recent and upcoming economic growth and consumer spending data 2. Capital spending, housing slowing, money supply now increasing again 3. Deficit/Debt expectations 4. Updated tariff expectations on inflation, growth, etc. 5. Latest expectations for the social security trust fund 6. Trends in stock valuations, earnings and operating profit margins

Dear Clients and Friends,

Estate planning is one of the most foundational steps you can take to protect your legacy and loved ones. Unfortunately, many people make costly errors that create confusion, delay, and unintended consequences. Here are the ten most common estate planning mistakes to avoid: 1. Not Having a Plan Dying without a will or trust means state laws dictate who inherits your assets, often leading to outcomes you never intended. Do not let the courts decide. 2. Failing to Update Documents Life changes — like marriage, divorce, or the birth of a child — require updates. Outdated plans can send assets to the wrong people. You should update every 5 years at the minimum. 3. Not Planning for Incapacity Without a durable power of attorney or healthcare directive, your family may need court intervention to manage your affairs if you're incapacitated. This makes sure someone can pay your bills while you are not able to. 4. Choosing the Wrong People or too many people Naming an untrustworthy or incompetent executor, trustee, or agent can lead to mismanagement, delays, and legal disputes. Having multiple trustees or executors makes decision making difficult. 5. Ignoring Beneficiary Designations Retirement accounts and insurance policies bypass your will. If designations are outdated, assets may go to unintended recipients. I have heard of ex-spouses receiving tax-free insurance payout and not the current spouse. Check the beneficiaries every year. 6. Overlooking Tax Implications Failing to consider estate or gift taxes can shrink your legacy. Strategic gifting and trusts can minimize tax burdens. In 2025 the lifetime estate and gift exemption is $13.99 million per person. However, if Congress does not do anything, the exemption amount goes down $7 million on January 1, 2026. If your estate is more than the exemption it will be taxed at your tax rate. Example: If you pass in 2025 and your estate is $15 million, the taxable amount is $1.01 million. You would owe $404,000. In 2026, if nothing changes, your tax would be on $8 million. You would owe 40% on $8 million, $3.2 million in taxes. 7. Fund your Trust Trusts can avoid probate, ensure privacy, and manage inheritances over time. Without them, assets may be misused or delayed. Make sure you title what you can in your trust or put as beneficiaries if necessary. Consult your lawyer and make sure they walk you through how to retitle property and investments in the Trusts name. 8. Forgetting Digital Assets Without access to online accounts and passwords, heirs may lose valuable financial and sentimental property. Even if you are in the hospital incapacitated, who is going to keep paying the monthly bills. Have a plan! 9. Leaving Assets Directly to Minors Minors can't legally own property. Without trust, courts step in — and full control often transfer at age 18. If you have trust, you will have the trustee manage the assets for the minors. You have more control from the grave with a Trust. Feel free to put in there that they must be debt free other than a mortgage for a year or get an education. They must complete it before a trustee releases the funds. I do not want my 18-year-old getting a lot of money right away! 10. Going DIY Without Legal Help Online forms can’t replace personalized legal guidance. Mistakes here often cost far more than hiring an expert. Here is a real-life example, A man drafted his own will. He was divorced and had 6 kids. In the will he stated that his kids would each get 1/6% of the estate and his ex-wife would have the remainder. The kids collectively only got 1% (1/6*6), the ex-wife got 99%. All because of a percentage symbol. Just be careful. Spending the money now will save you in the long run. Avoiding these mistakes ensures your legacy is secure and your wishes are honored.

This week, CEO Eric Boyce, CFA discusses: 1. Implications from the bombing of Iran 2. looking ahead to possibilities surrounding the expiration of the 90 day tariff moratorium 3. foreign ownership of equities rising/US v. International valuations are well out of line with trends 4. sources of concern for consumers & probability of recession 5. private capital exits remain sluggish and new capital raises falling below recent trend due in part to uncertainty

Key Takeaways Risk management is about preparation, not prediction. You can’t control everything, but you can plan for what might go wrong. It helps protect your financial goals . Whether you're saving, investing, or planning for retirement, risk management keeps you on track when life takes a turn. The core steps include identifying, assessing, controlling, and reviewing risks. Common tools include insurance, diversification, emergency savings, and legal planning . These tools help reduce financial stress when unexpected events happen. Risk is normal , managing it gives you control. Instead of avoiding risk, a good plan helps you move forward with confidence. What is Risk Management in Financial Planning? Risk management in financial planning is the process of identifying, assessing, and taking steps to reduce the impact of potential financial losses. It helps people plan for events that could hurt their finances, like a market drop, unexpected medical bills, or even losing a job. The main goal is to protect your money and make sure your financial plan stays on track, even when things don’t go as expected. Some common types of financial risk include: Market risk – when your investments lose value because of changes in the stock market Inflation risk – when your money loses buying power over time Liquidity risk – when you can’t access your money quickly when you need it Liability risk – when you face legal or financial responsibility for something, like an accident or business issue Longevity risk – when you outlive your savings in retirement By creating a structured plan to manage these risks, people can feel more confident about the future. Planning ahead helps lower the chance of a big financial shock and gives you options when unexpected things happen. A strong risk management plan is not about avoiding all risk, it’s about being ready for it. Different professionals help manage financial risk as part of a larger financial planning process. A financial analyst usually focuses on numbers, trends, and investment performance. Their job is to look at the data and make forecasts. A financial planner or risk manager , on the other hand, looks at your full financial picture. They help build plans that protect your money, lower risk, and keep your goals within reach. The Four Components of a Risk Management Plan A strong risk management plan is built around four key components. Each part plays a different role in protecting your financial future. Below is a breakdown that shows both the purpose of each step (Objective) and how it’s actually done (Process):

This week, CEO Eric Boyce, CFA discusses: 1. What CEO's are worried about the most 2. equity market valuations, sentiment, high retail investor ownership levels and potential opportunities 3. consumer and producer inflation indicators below expectations; tariff-based inflation likely be on the horizon, but not viewed as recessionary or particularly long lasting 4. consumers have pulled back on spending; soft data strengthening with tariff abatements and better equity markets 5. state of housing - rents may go up later this year; home price growth likely to slow 6. Banks more willing to lend; delinquencies higher, but may have peaked 7. analysis of weakening Chinese demographics, credit quality, household debt to GDP, lending activity and weakness within the real estate and corporate sectors

This week, CEO Eric Boyce, CFA discusses: 1. changes in the first quarter economic growth report 2. trade and dollar comments following the trade court decision 3. Fed in tough spot; inflation v. growth worry - impact on recession probability 4. Earnings and profits expectations - likely some slowing second half of 2025 but not catastrophic 5. Richmond Fed - slight improvement in expectations, although uncertainty remains a driver 6. housing clearly still stuck in low gear due to affordability 7. analysis of hard data - order, bankruptcies, etc does not reflect crisis situation 8. discussion of strong correlation between gold and dollar 9. energy stocks imply strong pricing heading into summer driving season 10. discussion of dynamic shifts within the S&P 500 index 11. private markets slow getting out of 2025 gate; institutional investments expected to increase, but new activity appears slow

In my previous article, “Caring for an Aging Parent,” we explored how to begin conversations with aging loved ones about their future healthcare needs. In this Part II, we’re diving into the why —why long-term care (LTC) planning is so critical for families today. Let’s start with some hard truths: 7 out of 10 people over age 65 will require some form of long-term care support. 66% of caregivers tap into their own retirement or savings to cover the cost of care for a loved one. 100% of families are impacted in some way. The importance of this topic becomes immediately clear: LTC will likely affect every single person reading this . It might be your parents who need care. It could be your spouse’s parents. And, statistically speaking, you or your spouse are very likely to need support in the future . In our financial planning practice, it’s our responsibility to address topics that can dramatically affect the outcome of decades of hard-earned savings. The good news is, there are many strategies and tools available today that can help you prepare and protect your family’s financial future. What Are Your Options? 1. Traditional Long-Term Care Policies Standalone LTC policies were widely used 30 years ago, but many providers have since exited the market or increased premiums to unsustainable levels due to rising life expectancy. For that reason, we do not recommend these policies and won’t spend time reviewing them here. 2. Life Insurance with Long-Term Care Benefits For older clients, we often recommend life insurance policies that provide LTC coverage if needed—but also offer a death benefit if care is never used. This structure ensures that your premiums are not lost, no matter what happens. 3. Hybrid Policies These insurance products combine life insurance with long-term care features. They allow the policyholder to access a % of the death benefit while still alive to pay for caregiving services—such as in-home care, assistance with daily activities, or transportation to appointments. Hybrid policies offer flexibility and peace of mind. 4. Annuities with Long-Term Care Ride Annuities have significantly improved in recent years. Today, certain annuities can double your monthly income for a set period if you experience a qualifying LTC event. For example, if you're receiving $6,000 per month in retirement income and meet the criteria, your income could increase to $12,000 per month for a period of time to help cover care costs. Be Proactive, Not Reactive These are just a few of the tools available to help you p lan ahead for the high costs of healthcare and caregiving later in life. The key is to start planning early—before a crisis hits . By doing so, you protect not just your savings, but also your independence and the well-being of those you love. If you haven’t yet talked about LTC planning with your family or financial advisor, now is the time. Because when it comes to long-term care, it’s not just about protecting assets—it’s about preserving dignity, choice, and peace of mind.

Dear Clients and Friends,