Our Insights on

  • DOL Fiduciary Rule - An Update

    Fourth Quarter 2016

    The landscape for personal financial planning will change this year.  It is highly likely we will see changes in the income tax and estate tax areas.  There has grown up, to the extent it did not exist before, a cottage industry in prognostication about where things are headed.  Of course, like almost all prognostications, most of these will turn out to be wrong and as always we recommend you treat prognostications with a good dose of skepticism.  They are guesses.  No more, no less.

    One subject of interest is whether the recently promulgated DOL (fiduciary) rule, which I discussed in our 1st Quarter 2016 letter, will be repealed or otherwise vacated.

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  • Reverse Mortgages

    Third Quarter 2016

    We have begun to reconsider the use of reverse mortgages. This has been an "against the grain" exercise since we have always preferred to leave the home equity in our plans for clients so that even at an advanced age and out of money, the client would still have the equity in their home to fall back on as a last resort. The availability and continued evolution of reverse mortgages, or Home Equity Conversion Mortgages (HECM's), have prompted us to refine our thinking on this issue.

    The conventional wisdom has been that reverse mortgages are for use as a last-resort. Last resort situations can still be a reason to take out a HECM, but other uses may make the HECM attractive as well.

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  • A Powerful Charitable Device

    Second Quarter 2016

    As a part of the year end legislation in 2015, Congress made permanent a special rule on IRA distributions that can be quite useful and beneficial to those IRA holders that are charitably inclined. Called the Qualifying Charitable Distribution (QCD) rule, the provision allows special tax benefits for an IRA owner who makes a distribution of IRA funds to a qualifying charity. The rule had been in place for several years before, but was of quite limited utility since the QCD was always in the "extenders" legislation that only were extended after the end of the year. That left the use of the provision in a state of being quite uncertain from a planning perspective. Again, now the QCD provision is permanent. How can QCDs work for you?

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  • A New Rule

    First Quarter 2016

    You have probably heard that the Federal Department of Labor (DOL) recently issued a new set of rules that prescribe a standard of conduct for those advising retirement account (including IRA account) holders. The rules provide that advisors, (more particularly brokers and annuity salespeople) can no longer earn commissions and other forms of conflict creating compensation from these advisory arrangements unless the advisors agree to do so pursuant to a Best Interests Contract (BIC) which binds the advice provider to a fiduciary standard.

    The new rule does little to clarify or rationalize the already bewildering landscape of rules of conduct for financial advisors. While it is well-known in the financial services industry that trust is at the heart of the relationship between financial advisor and client, it is also well known that most clients have little clarity as to what ethical standards may apply to their advisor. 

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  • A Look Back

    Fourth Quarter 2015

    With the completion of 20 years of operations, I hope you enjoy a glimpse back at what we were (I was) thinking about 20 years ago, and how things have changed (and what has stayed the same). 

    Our investment management process began as a careful and laborious screening and filtering and analysis of actively managed mutual funds. The screening encompassed virtually the entire mutual funds universe. At the bottom of the mutual fund analysis process was the search for Alpha, or market-beating performance. This search was driven by the desire to meet the expectations of the broadest population of the investing public, many if not most of whom expect their investment manager to “beat the market”.  

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