Category Archives: Sign of the Times

Protecting Our Seniors and Their Assets

By Patrick Brault, CPA, CTFA | Principal, Regional Director

Over the past few years, a disturbing trend has come to light regarding our nation’s growing senior population: elder financial abuse and exploitation has become more widespread, with new cases increasing by the day. According to AARP, senior fraud accounts for nearly $3 billion in losses each year — and that number is expected to grow.1 A recent article in The New York Times noted that 10,000 people will turn 65 every day over the next decade, which means more elders will be susceptible to financial abuse in the coming years.2

Unfortunately, the full impact of this epidemic remains largely unknown — one of the greatest concerns for this age group is that most cases of abuse, especially those related to finances, are not reported. Typically, financial losses are related to situations involving physical or mental abuse (or both). And what’s worse is that the perpetrators are often people the senior wouldn’t expect — in fact, many cases of abuse involve “trusted” confidants, such as relatives, friends, advisors and others.

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Top Three Changes on the Tax Front for 2016

By the OneBite Editorial Staff

In one of its final legislative actions at the close of the year, Congress cleared the “Protecting Americans from Tax Hikes” (PATH) Act of 2015, which permanently reinstated a number of popular tax provisions that had lapsed in previous years (you can read more about the bill here).

Beyond the passage of the PATH Act, 2016 will bring a handful of minor changes that you’ll need to keep on your radar for next year. Right now, you’re probably thinking, “That’s great and all, but I’m focused on finalizing my 2015 tax return — I can’t even think a full year ahead.”

Sure, it may sound daunting — but it’s important to remember that tax planning is a year-round process, one that doesn’t halt once your return is signed and filed. The sooner you plan ahead and start the preparation process, the better your chances of achieving greater savings (and avoiding any unwelcome surprises) next year. The first step: schedule a meeting with your advisor to get up-to-speed on the new adjustments and assess whether they’ll affect your tax plan moving forward.


Here’s a quick look at the top changes that will take shape in 2016:

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New Legislation You Should Know: 529A ABLE Accounts

By Benjamin Hayes, CFP®, MBA | Principal, Senior Financial Advisor

Late last year, Congress enacted new rules to improve the recently created 529A ABLE account, a tax-advantaged savings account for individuals with disabilities. Before we jump into the new rules, let’s briefly review the key advantages and distinctions of the account itself.

529 New Legislation - Benjamin Hayes_ABLE

A Step Forward for Special Needs Planning

In 2014, Congress passed legislation to expand on the popular 529 plan for college savings, creating the 529A ABLE (or “Achieving a Better Life Experience”) account. The new ABLE account was developed to provide parents the opportunity to save money in a tax-advantaged investment vehicle for children with special needs.

A typical 529 plan allows for tax-free distributions only if the beneficiary uses the funds for qualified education expenses. But if the beneficiary doesn’t have expenses from one of those qualified institutions, any earnings withdrawn from the 529 account are subject to taxes and penalties. For parents of children with special needs, this rule significantly limited the practical use of a typical 529 account.

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By Roger Hewins | President

A sleeper hit movie released several years ago, “Sideways” followed the misadventures of two oddballs who could not have been more different. What was supposed to be a week of golf and good wine — two old college roommates having a nice time before the wedding of one of them — turned into something quite different. Both of them traveled from the heights of ecstasy to the depths of despair (really!), only to end up making some modest progress along their respective life journeys.

And so it goes for us. We couldn’t even sit down to write the year-end letter before the S&P 500 fell on each of the first five trading days of 2016, down 6% overall — the worst first week ever.1 Now, it is close to last August’s low; the Dow is down more than 1,000 points, as well.

So what’s with “Sideways?”

A “sideways market” is one that moves up and down over time, but makes little net progress. Imagine the line chart going up and down and ending up more or less in the middle, back to where it started. Add a little extra volatility, and that’s what we have had on our hands this past year or so. Interesting…the period just before a presidential election is often a time when markets do very well. Certainly not this cycle, not so far — up and down, down and up.

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2015 Through a Long-Term Lens

By Martha Post, CFA | Principal, Chief Investment Officer

Overall, we’ve had a pretty smooth, upward path in the markets since the 2008 financial crisis, but each year brings its share of upsets.  2015 is ending on some uncertain notes with a spate of worrisome headlines, related to this week’s Fed meeting and interest rate hike; the closing of the Third Avenue Focused Credit Fund, an aggressive high-yield bond fund; and the continuing decline in oil prices, to name a few.  Meanwhile, Congress looks to be on the verge of passing tax and spending bills that would keep the government running through next September, after the usual last minute deliberations.

2015 Year in Review Continue reading 2015 Through a Long-Term Lens

The End of Complex Social Security Filing Strategies

By Karl Schwartz, CPA, CFP® | Principal, Consultant and
Ryan McGuire, CFP® | Senior Associate Consultant

Over the past 15 years, a few Social Security filing tactics have gained momentum among married couples reaching retirement age. These strategies are a source of conversation for many clients and were also the focus of Hewins Financial Advisors’ first OneBite™ Webinar, which took place last month. As a firm, Hewins recognizes the importance of Social Security for all working families and is proactively educating its client base about the changing landscape of the program.

On November 2, 2015, President Obama signed the Bipartisan Budget Act of 2015, which impacts two of the strategies mentioned in the webinar: “file-and-suspend” and “restricted application”.

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It’s very important to understand that the following are the authors’ personal opinions of the new rules, but nothing herein is an interpretation of or opinion on behalf of Hewins Financial Advisors or its affiliates. The authors expect the Social Security Administration (SSA) to provide their own interpretation of the new rules in the coming months, which may vary drastically from those set forth below; Congress may even pass some revisions to eliminate any “unintended consequences” of the original language.

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The Curious Case of ETF Illiquidity in Volatile Markets

By Rafia Hasan, CFA, CFP® | Senior Associate Consultant, Investment Committee

Exchange-traded funds, or ETFs, have gained popularity in recent years, amassing close to $2 trillion in assets.1 ETFs come in many shapes and sizes: the plain-vanilla funds are similar to index mutual funds, with the added flexibility of allowing investors to trade throughout the day. Other ETFs follow a more complex strategy — some promise the inverse of an index, while others are leveraged to provide double or triple the return on an index.

Most long-term investors are better served steering clear of the latter — complex ETF strategies that are opaque, speculative and often contain hidden risks. But what about the ETFs that track broadly diversified indices? Do they make sense for the long-term investor?

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When Should You Take Social Security Benefits?

By Thuong Thien, CFP® | Consultant

Do you want to learn more about how you can boost your Social Security benefits? Click here to register for the first installment of our OneBite™ Webinar series.

You have probably seen the word “FICA” on your paychecks — and like many people, you may disregard it. FICA, or the Federal Insurance Contributions Act, actually refers to a tax you pay toward Medicare and Social Security. While it’s important to understand the impact both programs will have on your future, let’s focus on the latter: Social Security.

One of the most common questions I hear from clients is, “When should I start my Social Security benefits?” It’s important to build a framework for your retirement and understand where Social Security fits into your overall financial picture. Here are a few aspects to consider as you start to navigate the process.

When to take Social Security benefits

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An Introduction to Tax-Smart Indexing™

By Martha Post, CFA | Principal, Chief Investment Officer, Chief Operating Officer

Volatile market environments, like the conditions we recently experienced, remind us just how valuable a tax-aware investment approach can be. Though down moves in the market can be unsettling, they can also provide opportunities for tax-loss harvesting — the “silver lining” of a market decline, which can provide tax benefits at a time when asset values are going down.

As a CPA-based financial advisory firm, we have always taken a tax-sensitive approach to investing. We deploy a range of tax-management techniques on behalf of our clients — from using low-turnover funds, to the strategic placement of assets in accounts that make the most tax sense, to the ongoing harvesting of losses to offset gains.

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Perspectives on Volatility

By the OneBite Editorial Staff

From rebound to reverse, the market has shown its volatile side this week, putting investors’ nerves and confidence to the test. On the first day of trading in 2016, global stocks took a sharp tumble amid signs of an economic slowdown in China. U.S. stocks followed suit with the S&P 500 down by 1.5 percent on the same day.1

As uncomfortable as the ride may be, the current circumstances seem to confirm what we already know: markets go up, and yes, markets go down. In times like these, we choose to remain steadfast to the tenets of our investment philosophy, keeping our eyes focused on the long term — not the headlines.

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