Fires in California Remind Us to Use Our Hearts and Heads

Fires in California Remind Us to Use Our Hearts and Heads

By: Joe Delaney At times like these, when record-breaking fire is again ravaging parts of California, we remember that our financial portfolios are not just numbers on paper. They are about protection for ourselves and our loved ones. They are also about our human desire to be good custodians of the world and empathic neighbors. Here in the San Francisco area, we at Lifeguard Wealth are having a lot of conversations with people about what they can do to help. We share our thoughts below. First, let’s summarize what’s happening in this state. Wildfire Update At the time of this writing, the Camp Fire in Butte County, northern California has become the most destructive and deadliest in California history, eclipsing last year’s Tubbs fire in Santa Rosa. CBS News reported on November 13th that it had burned through 130,000 acres and taken 48 lives. Meanwhile, the Woolsey and Hill Fires are burning to our south, northwest of Los Angeles. These have claimed over 100,000 acres and 2 lives. As always, high winds, high temperature and dry air are fueling this latest outbreak. Firefighters are doing their best to channel the blaze away from population centers, but many people have already lost their homes and business. There will be more destruction before this is over. How You Can Help (and Be Smart About It) There are many organizations you can support that are claiming to help. It is important to use both your heart and your head when the need is so great. If you do not have a personal relationship with a charity’s leadership, you must do your research...
New Real Estate Scam – Confirm and Verify Again 

New Real Estate Scam – Confirm and Verify Again 

Lately, we’ve seen an increase in fraud schemes related to the sale and purchase of real estate.  Imposters are gaining access to various real estate company email addresses and sending false wire instructions to people. Because the person was anticipating the email they provide the wiring instructions to their advisor and approve the transaction.  Imposters are also gaining access to personal emails. They then use the personal email to send wiring instructions to their financial advisor update wire instructions previously sent to the advisor by the title company. Because the client and advisor were both anticipating the wire, they verbally approve and process the instructions without confirming details with the escrow company. Take action Do not trust closing information or transaction instructions received via email. EVEN IF THEY LOOK LEGITIMATE. To ensure that the transaction is legitimate, you should call or video chat with a trusted person using a verified phone number to confirm the instructions. If you have any questions regarding this information please contact our...
The Only Market Volatility You Can Count On

The Only Market Volatility You Can Count On

By Tim Maurer “As you can see, we’re experiencing rough air at the moment. But as a reminder, we can’t predict rough air,” said the Delta airline pilot ferrying me from St. Louis to Charleston (via Atlanta—always Atlanta), “so please keep your seatbelts on whenever you are seated.” Thank you, sir, for giving me precisely the hint of inspiration I needed to frame this week’s note of encouragement while in the midst of one of the crazier market stretches we’ve seen in several years! Of course, statistically speaking, this momentary bout of stock market extremism is more the norm than the exception.  No, it’s not particularly normal to have thousand-point-up or -down days for the Dow Jones Industrial Index.  But volatility—market ups and downs—is, indeed, more normal than, for example, what happened last year. Did you know that 2017 was one of the least volatile market years in decades?  The U.S. stock market was not only up for the year—but for every month of the year—for the first time ever.  Who would’ve made that prediction late in 2016, in the middle of the craziest election cycle of my two-score-and-two-year lifespan? When considering this aberration, I can say with confidence one of the very few market predictions I (or anybody, for that matter) can responsibly make: The market is more likely to be volatile than not. There are many financial writers and companies who are seeking to capitalize on fear and greed by offering overly optimistic or hopelessly pessimistic takes on any and every market movement.  But the best anyone can actually do with intellectual honesty is to acknowledge the obvious fact that we’re currently experiencing some volatility. And...
Remember the Equifax Breach? Be Worried if You Have Not Done This

Remember the Equifax Breach? Be Worried if You Have Not Done This

By Joe Delaney In a recent conversation with a client, I asked him whether he had put a credit freeze on his files with our three U.S. credit bureaus to protect himself from identity theft since last year’s Equifax breach. His response was understandable and common. No. Nothing has happened to me, so I must be okay. I don’t blame him. We all struggle with the “out of sight, out of mind” effect. We live in a time beyond the 24-hour news cycle. Now, a story that appears in our news feeds at breakfast is eclipsed with another by lunchtime. How are we ever to follow consequences of the events of six months ago? Last September I recommended a few action steps, the most important of which was to put a freeze on your credit. Not a temporary “lock”, which hackers can get around as easily as they can breach your account, but a permanent freeze (check with your state of residence to determine if it is indeed permanent or expires after a period of time). This follow-up article is about why that’s still a vital step to take. WHAT TO DO WHEN YOU KNOW A TSUNAMI IS COMING Think of this from the hackers’ point of view for a moment. There is no point to illegally accessing the personal data of nearly 148 million Americans (60% of the adult US population!) unless you plan to use what you got. But when? When everybody has forgotten all about it. When your guard is down. The breach was like seismic activity that warns of a greater event to come, like...
Taxes Are Everywhere, But So Are Planning Opportunities

Taxes Are Everywhere, But So Are Planning Opportunities

By William Morgan Start funding an education savings plan once you begin making plans to start a family. 529 plans have become more flexible. You can now use them to pay for kindergarten through 12th-grade tuition, and not just on college expenses. Check your home state to make sure it has updated its rules to allow K-12 withdrawals as qualified distributions. The goal of beginning to save early is now even more important. Understand the new tax implications on purchasing a home. State and local taxes — including real estate taxes — are now capped at $10,000. Mortgage interest is limited to the amount of interest on qualified debt of $750,000. This means that buying a new home may now come with less tax savings, making it more important to understand your specific circumstance. When making charitable contributions, consider using a donor-advised fund to lump charitable contributions in one year, then distribute the funds to charities over many years. This strategy may allow you to itemize deductions in one year and then take the standard deduction in subsequent years, enabling you to achieve a tax benefit that you otherwise might not receive. Worrying about federal estate taxes may no longer be a concern with the individual lifetime estate tax exemption nearly doubling from $5.49 million to $11.2 million. When considering making lifetime gifts, it is critical to consider how to optimize the benefit from the step up in basis to reduce a family’s total tax bill. When someone receives an inheritance, the cost basis of the property is stepped up to the fair market value at the date of death. This eliminates any taxable...
Expect Volatility

Expect Volatility

By Sue Stevens The past two years have seen an unusually low level of volatility in the stock market. That can lead to complacency. Last week, we started to see bigger “air pockets” emerge, which can be jolting to your system. To put Friday’s market drop in perspective, the Dow fell about 2.5 percent. It was down 4.1 percent last week. Monday saw an additional 4.4 percent drop for a total of 8.5 percent down within a week. A 10 percent drop is normal. We’re just out of practice. Don’t let the media throw you off balance. So What Happened? The jobs report came out and showed more people are working. That sounds good, right? But some people read that to mean that the Fed will “tighten” more quickly — or raise interest rates more often. The prediction is that it will do so four times this year. We already knew that. It’s basically a sign of an improving economy. No real problem there. But that can mean inflation can be on the move, too. It’s not a problem now. And most projections show it picks up, but not dramatically so. Bond interest is rising as well. Again, that was expected. Last week the 10-year Treasury jumped to paying 2.85 percent. This week, we’re back closer to 2.6 percent. We’ve been waiting for it to rise above 2 percent for quite a while. Economists predict it may hit 3 percent by year-end. 4 percent is more of a historical level, but 3 percent is more likely in this environment for some time. What Should You Do? Right now, do...
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