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Five Things to Know This Week

Five Things to Know This Week

1. Charity Begins at Home

If you’re concerned about your charitable giving strategy right now, it’s okay to be cautious. Don’t feel guilty putting off the contributions you may have made in previous years so that you can be sure you are supporting yourself and your family right now. You can always make a decision in the 4th quarter of this year and maybe you’ll even have appreciated securities to send, which would be a good charitable tax strategy to consider. Your family may need more assistance than usual and we want to help. If you are considering a gift to your children, we offer free guidance to you and them so that we can provide them with the optimal path on how to spend your generous support wisely.

2. Market Volatility

We expect global bond and equity markets will remain volatile as COVID-19 continues to take its toll on the global economy. The absolute collapse of oil this past week was an obvious product of this global pandemic, as were many retail businesses filing for bankruptcy. As always, the 1 North team advocates a disciplined investment process by rebalancing toward your investment targets and by maintaining a diversified, strategic asset allocation to smooth out market volatility. As stated last week, please let us know of any cash needs to cover at least 3 months of expenses. This will allow us time to liquidate positions during optimal market days.

3. Consider a Roth Conversion in 2020

For those of you with a large traditional IRA and lower earned income, we should review the possibility of converting a larger amount to a Roth IRA. Now may be the optimal time, given the reduction in value of some of your more volatile growth positions. We would take the most volatile growth positions in your traditional IRAs and transfer (convert) them to your Roth IRAs. How much we convert this year depends on how much tax you are willing to pay. We will review this with your tax advisor, but we can convert up to the top of the 12% tax bracket or we could convert up to the 20% effective tax rate.

4. Financial Stress

Many factors contribute to your physical health. During this pandemic, your health should be your main concern and keeping your stress levels low, including financial stress, is important. We are here to help you with this – always. Start by reviewing your finances. Determine what is important and what is not, then break these out into what is a variable expense and what is a fixed expense. Once you have determined what is important, talk to our team to help you connect with resources and methods to help you with any of your challenges. As with most financial professionals, our team is up to date on federal and state programs related to this pandemic, including stimulus checks, unemployment benefits, small business loans, etc. and we stand ready to help!

5. Stay Connected

Now is as important a time as ever to remain connected to one another. There are a number of free video conferencing applications available for both work and personal use. Though Zoom still ranks at the top of most lists for video conferencing and screen sharing, we’ve omitted it here due to the recent security concerns (it is fair to note that Zoom continues to make changes in response). The exact application that works for you will depend on what you’re looking for, but here are some of the top competitors to consider. Google Hangouts/Meet is available on desktop and mobile for video chats of up to 10 participants with no time cap. Microsoft Skype supports up to 50 participants with no time cap and ability to record. CISCO Webex is currently offering an upgraded free version that supports up to 100 participants for an unlimited duration and offers the ability to screen share. Microsoft Teams is built into Office 365 with a free version available using a personal email address. The free version offers video conferencing for up to 300 participants, guest access, and screen and file sharing.

As always, we are here as a resource for those that you care about and for. If you are worried that your family and/or friends may have been given improper financial guidance or are losing their hard-earned assets, we are available for a free second opinion or guidance to make sure they stay financially safe.

Be well and have a wonderful week!