THE PATIENT PROTECTION AND AFFORDABLE CARE ACT
May 20, 2011 by Tom Licciardello, CFP · Leave a Comment
Federal Healthcare Reform
The passage of Federal Health Care Reform, also known as the Patient Protection and Affordable Care Act, provides opportunities and challenges for all parts of our health care system, including employers, consumers, providers and insurers. We are committed to providing our clients with information about health reform and how it may impact them.
Harvard Pilgrim Health Care has prepared a wonderful document that explains the impact of reform on employers and their employees:
Compass Capital Corporation Economic Update
May 19, 2011 by Tom Licciardello, CFP · Leave a Comment
Please take a moment to view our video:
Is the Inflation Monster at the Door?
April 7, 2011 by Tom Licciardello, CFP · 1 Comment
There is an increased amount of sp
eculation about inflation, as geopolitical tensions continue to build and disrupt the production and supply of oil. The increase in rhetoric is focused around both short- and long-term inflation: if inflation is present, is it transitory or is it settling in for the long haul?
At times, it can be difficult to wrap one’s head around all of this inflation talk, especially when consumers are feeling the pain of higher prices at the gas pump and the grocery store. On a related note, have you noticed that cereal boxes have become smaller, or that bags of chips are now lighter? These are simply creative ways of passing higher prices to the consumer without causing sticker shock.
However you look at it, inflation as experienced and measured by the general consumer is at a high point. But is this a sign that persistent price inflation is just around the corner? Not necessarily, or at least not when measured through the gauges that the government uses to analyze inflation. This is why Federal Reserve Chairman Ben Bernanke remains very vocal in his view that inflation is not currently a problem and that the recent price increases in oil and commodity prices are likely to prove transitory.
Read the full commentary presented by Sean P. Simko, Managing Director of the SEI Fixed Income Portfolio Management team:
Another Piece of the Inflation Puzzle
Donate to Japan tsunami victims, not scammers
March 15, 2011 by Tom Licciardello, CFP · Leave a Comment
as seen on the website “MarketWatch”
How to avoid frauds set up to snare charitable dollars aimed at Japan
By Andrea Coombes, MarketWatch
SAN FRANCISCO (MarketWatch) — Scammers already are trying to profit off the tragedy and devastation that continues to unfold in the aftermath of Japan’s massive earthquake and tsunami.
JAPAN IN AFTERMATH | MarketWatch Topic: Disasters
That means, if you’re eager to donate to the victims in Japan, it’s best to proceed carefully. Already, a scam email is circulating that purports to be from the British Red Cross, asking that donations be wired, said Jenny Shearer, an FBI spokeswoman.
“If you are moved to make a donation to help people in Japan,” Shearer said, “look up whatever organization you like to give your money to, go to their website, find them in the phone book, or go to their office if they’re near you … If you respond to an email or you wire money, that money is not going to go where you intend it to go to.”
In the days and weeks after Hurricane Katrina, more than 4,000 new websites related to the hurricane were created, and while some were legitimate, “fraudulent ones are popping up faster than we can pound them down,” the FBI said in a press release at the time.
Among other snares, scammers often create websites that look like legitimate charitable organizations so they can steal givers’ credit-card numbers and other personal data. Fraudsters also send out “phishing” emails with links to those fake sites. They may send emails with attached photos of the disaster, but those attachments contain malware and viruses. Then there’s “smishing” — unsolicited text messages that either download malware or try to prompt you to give up your personal information or credit-card number.
To make sure you avoid any similar tactics related to this disaster, heed the tips below to make sure your money gets where you want it to go.
Also, listen to this podcast on how to avoid earthquake charity scams.
- Whether you plan to text your donation or mail a check, make sure the charity is an established organization. Go to sites such as Charity Navigator (www.charitynavigator.org) and the Better Business Bureau’s Wise Giving Alliance (www.bbb.org/charity) to vet the charity.
- Be wary of pleas for donations on Facebook and other social-media sites. They may be legitimate, but research the charitable organization before contributing. And don’t click on links to a charitable site; instead, type the charity’s website address directly into your browser to avoid being misled by scam sites that look real.
- Never give money in response to an unsolicited email message or phone call. Instead, contact the charity yourself, either by typing in the website or calling it directly.
- Be wary of groups that say they will forward donations. In some instances, they may be aboveboard, but if you’re not sure, it’s best to go directly to the main organization.
- Don’t open email attachments professing to be about the disaster. They’re all too likely to contain a virus.
- If you text a donation, keep in mind that it may take as long as 90 days for the charity to receive your gift, according to a tip sheet posted online by Charity Navigator.
- File any fraud complaints with the Internet Crime Complaint Center (www.ic3.gov). Known as IC3, the Center is a partnership of the FBI, National White Collar Crime Center and Bureau of Justice Assistance. Also, call the National Center for Disaster Fraud at 1-866-720-5721 to report the fraud.
Tsunami captured on video
Amateur video shows how oceans waters overtake a coastal Japanese town with deadly force.
Japan faces nuclear leak
Another explosion hits the stricken Fukushima Daiichi nuclear power plant, with ‘substantial amounts of radiation’ leaked.
• Donate to victims, not scammers
• Global tech sector could feel the impact
• National Guardsmen head to Japan
• Another blast hits nuclear plant
• Slide show: Japan’s intensifying nuclear crisis
• Slide show: Japan’s devastation in pictures
MARKET REACTION
• Japan stock crash threatens global markets
• Leveraged ETF that shorts Japan rallies 15%
• Nuclear-energy ETFs sell off on Japan news
• Coach, Tiffany pay price for Japan exposure
• Uranium shares fall as Japan battles meltdown
NUCLEAR CRISIS
Tokyo watches unfolding crisis
Tokyo residents are told to remain calm after news of a radiation leakage at an earthquake-damaged nuclear reactor, and MarketWatch bureau chief Lisa Twaronite wonders what to tell her children.
• Nuclear renaissance in peril
• White House, GOP still support nuclear energy
• GE, Hitachi to work on nuclear safety
• Tokyo residents weigh nuclear threat
• China won’t give up on nuclear energy: report
For more information, see tips on Internet Crime Complaint Center site.
Also, see the tip sheet on avoiding scams on Charity Navigator site.
Should you have a “Bucket List”?
March 1, 2011 by Tom Licciardello, CFP · 4 Comments
Having just returned from a trip to South America that included visits to Machu Picchu, the Straights of Magellan, Cape Horn, Ushuaia, Argentina, and Rio De Janeiro, my wife and I though about how lucky we were to visit such exotic locales.
In addition to the cultural exposure, we felt that we have a deeper understanding of international issues that comes when you leave “the nest”. We are motivated to continue our travels to the far reaches of the globe when we recover from this trip!
Discussing future trips lead us to the inevitable discussion of what’s on our “bucket list” – a term made famous by the movie of the same name. So how does one include life’s wishes into their financial plan?
Of course, the first recommendation is to come by the office and consult with “Your Trusted Financial Advisor”. One of our very important tasks is to assist you in understanding the financial implication of the goals you strive to achieve.
Attached is an interesting article by Robert Powell of “Market Watch” that gives great advice for those who want to create a Bucket List.
Dream big, but plan ahead!
This is the Year for Your Estate Plan
June 8, 2010 by Tom Licciardello, CFP · Leave a Comment
Why 2010 is the Year You Should Pay Closer Attention to Your Estate Plan
Estate planning is an essential part of anyone’s personal finances — no matter how wealthy you are. But even for those who have been diligent about planning for their spouses and heirs, this is a year when it may make particular sense to re-examine your strategy.
With the nonstop flurry of legislative activity in Washington, Congress has still not acted on the phase-out this year of the estate tax. If nothing is done this year, the heirs of any person who dies in 2010 won’t be liable for any federal estate taxes, no matter how big the estate. (The carryover basis rules for 2010, however, may give rise to additional planning considerations.)
Yet the potential bad news will come next year when the estate tax is scheduled to return with a vengeance on all estates over $1 million in size (the threshold was $3.5 million for individuals in 2009) with a potential return to a 55 percent top tax rate..
It’s worth a trip to your estate planning attorney and your financial planner to help ensure your paperwork is in order and the previous plans you’ve made won’t cause problems.
Family trusts – also called bypass or credit shelter trusts – are of particular concern. These trusts work this way: Individuals add what’s known as a formula clause to their will or revocable trust that distributes up to the maximum amount of assets that can pass free of estate tax to the trust if the individual dies before their spouse. The creation of the trust helps ensure that once your spouse dies, neither these assets nor any appreciation on them will be subject to estate tax. But if you die this year, a failure to address the formula clause could potentially cause you to unintentionally disinherit your spouse.
The bottom line: It’s worth making a call to a financial planner and your estate attorney to make sure your plans are still in order.
And what if you’ve never made an estate plan? Even if you’re not particularly wealthy, you definitely need one. Here are some specific things you should do and make sure you have in place:
Make a financial plan: You can’t have a very effective estate plan without a full grip on your finances. First, sit down with us to create a financial plan so you can gain an understanding of all the various aspects of your finances from your income and investments to your debt. Add various facts about your family situation to the mix, and that’s the starting point for an estate plan.
Make a will your first priority: Unless you have a very complicated estate, a standard will with wording common to your state may be satisfactory to properly dispose of your assets, but it’s generally a good idea to get feedback from an estate attorney to make sure your will fits you and your financial structure.
How Much Term Life Insurance Should You Own?
June 8, 2010 by Tom Licciardello, CFP · Leave a Comment
You may have read that term life insurance rates are at historic lows and that now is the time to buy. It’s worth a quick primer on why life insurance is necessary and who should buy it before getting to specific amounts that individuals should own.
First, a quick definition of what term life insurance is. A term policy is a policy with a set duration on the coverage period – anywhere from one to 30 years – and when it reaches the end of that term, the policyholder decides whether or not to renew it. Term policies provide no cash buildup like whole or universal life insurance – it only provides a death benefit at the time the insured dies. Because term doesn’t provide that investment component – the cash value that can be borrowed against – term is generally cheaper to buy than whole or universal life.
There is plenty of debate whether consumers should buy term or whole life. Some critics argue that whole life is a poor choice because you arguably could get a better return from other investments. Though limited, there are good purposes for these investment-feature policies – generally as part of an estate-planning strategy.
But the first point is to decide whether you need insurance. People without dependents generally don’t, while people with spouses and families generally do. The primary point of life insurance is to replace income or eliminate debt if a breadwinner dies.
As for the decision on what kind to buy, it helps to get some advice. A well drafted plan can help you determine the right insurance products to buy based on your needs and other assets.
Through our planning process we can help you decide how much life insurance to buy and over how long a period. Some critical questions that should be asked when purchasing insurance:
- How much income would your spouse and your children need to replace your income over a period of years based on your current age?
- Will your spouse or guardian need to provide childcare support?
- Is there a mortgage to pay off?
- Are there substantial short-term debts, like credit cards or auto loans, to pay off?
- What are estimated college expenses for children and spouses, and when will those expenses start?
- How much will burial expenses be?
- Do you have any other life insurance?
- Are there anticipated expenses for care giving for elderly relatives or children or family members with special needs?
- Do you anticipate substantial estate taxes when you die?
- Do you have any other assets that can be liquidated sensibly or will bring in income?
Keep in mind that youth and health will also be factors in how much insurance you can afford to buy. And keep in mind that life insurers will investigate suspicious claims, so be honest about all facts you report.
Many term life policies are both “renewable” and “convertible.” Renewable means you can renew your coverage without a medical exam. The latter allows you to convert your term life policy into an equivalent cash value policy from the same carrier, should this make sense during the term of the policy. Again, the kind of coverage you choose should depend on your own personal needs and we can help you determine what those are.
Not only can we shop numerous life insurance carriers for the best rates, we also know it’s important to work with the most financially healthy carriers.
One more thing. Don’t buy insurance and forget about it. Make sure that every few years you are reviewing your insurance purchases as part of your overall financial plan. Life circumstances change – incomes rise and fall and family size changes. Your insurance holdings always need to reflect current needs and conditions.
Why U.S. Investors Should Care About the Euro
June 6, 2010 by Tom Licciardello, CFP · Leave a Comment
Sovereign debt troubles continue to persist in Greece and other parts of peripheral Europe, resulting in volatile global markets and heighted anxiety. Despite the unveiling of a Greek bailout package by the European Union and the International Monetary Fund, investors are still signaling a lack of confidence by sending European markets lower. As uncertainty about the situation grows, it has begun to affect the European banking system as well. In response, the euro has fallen against the U.S. dollar from $1.33 on April 30 to $1.22 on May 26. The Euro’s Decent.
Investment Update: Market Volatility Continues
June 5, 2010 by Tom Licciardello, CFP · Leave a Comment
From a market perspective, the month of May had more than its fair share of challenges. The Dow Jones Industrial Average fell 7.92% for the month, the worst percentage decline for the month of May since 1940. In addition, markets have been highly volatile, as shown by the Chicago Board Options Exchange Volatility Index (VIX), a measure of implied volatility in the S&P 500 Index that is also known as the “fear index;” it rose from 22 at the end of April to 33 by the end of May. From continued gloom cast by the sovereign-debt crisis in peripheral Europe to the “Flash Crash” on May 6, when U.S. blue-chip stocks made a staggering 1,000-point decline before recovering a majority of the drop by the end of the day, it is easy to see why investors remain cautious.
Kevin P. Barr, Head of SEI Investment Management Unit, presents the Market Volatility.