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May
19
Whine And Cheese
Carrie and I survived I-95 and visited close friends in Richmond this past weekend.  We are Virginia natives, but it was our first trip to Richmond in over thirty years (!) and it is much nicer now than I recollect.  It is a vibrant city with a unique history and I look forward to a return visit soon. As part of our sightseeing, I was on a quest to see the grave of Dr. Daniel Norton located in a Richmond cemetery.  While micro-brewery stops waylaid the mission, I did find this picture of his tombstone online and spared my hosts the tedium of searching a cemetery for a single tombstone. Why would I have an interest in seeing this dude's unremarkable gravesite you ask?  Well, I read a rather remarkable book a few years ago – The Wild Vine...
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May
12
French Toast
I watched the Kentucky Derby last weekend with renewed vigor.   Mel, one of our new team members, has a sister who owns a horse boarding / training farm in Lexington, Kentucky.   One of the pre-race favorites, Irish War Cry, was boarded on her farm as a colt and it made the race all the more interesting Fortunately, I did not wager on the handsome steed because he finished a disappointing tenth.  It rained most of the day pre-race and the track was a sloppy mess.   Almost Dreaming jumped to the front of the pack early and pressed on to win an exciting race. Mel later learned that Irish War Cry had not run on a sloppy track and / or did not like the track conditions.  Which, of course, impels a reference to the classic Seinfeld scene...
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May
05
Mea Culpa
It seems like spring pollen allergy season is getting worse every year.   I am fortunate not to have allergies, but wife Carrie and daughter Abby sure do and they seem to be suffering at new levels this spring.  Sure takes the fun out of blooming flowers and trees. And I was recently speaking with one of our clients, who happens to be an orthodontist, and asked him why is it that every other kids’ mouth these days has a mess for teeth and needs braces. His answer was interesting:  The human mouth is genetically getting smaller, but teeth, which were designed for biting meat off woolly mammoth bones, are not and thus can easily get misaligned.    While human evolution has been a boon to his practice, a budding technology is buffeting...
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Apr
28
A Dropped Socket
I settled into my recliner one evening this week to watch one of my favorite shows, American Experience on PBS, and return some e-mails – and was quickly forced to put the laptop down and watch a surreal story unfold that I had never heard before – the explosion of the Titan II missile in Arkansas in September 1980.  It was a scary near-miss nuclear disaster that made Three Mile Island (which transpired just eighteen months prior) look like a picnic. The story was reported on at the time, but the Air Force worked feverishly to cover up the details and the whole story is not well known. Do watch the show - titled Command and Control - released this past January, but let me pique your interest with a digest.  One of eighteen...
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Apr
21
More of Everything
Congratulations to all my accounting / tax friends on completing another tax season this week.  I read a great quote this week: "If you want to teach your children about taxes, eat 30% of their ice cream".  One of my favorite Seinfeld episodes is when Jerry and Elaine are flying somewhere and Jerry gets upgraded to first class while Elaine gets stuck in coach.  While poor Elaine is mired in misery, Jerry gets seated in luxury next to a super model.  They enjoy hot towels, cocktails, a fine dinner and a hot fudge sundae together.  When asked by the flight attendant if they need anything else, in exultation, Jerry blurts out "more of everything"! "More of everything" fits the headline news this week that New York signed into law the...
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Apr
14
The Problem with Average
This is my first book report in quite a while.  I have a client, let’s call him “Alan”, who sees the world like I do.   He recently endorsed a new book – The End of Average by Dr. Todd Rose - and I am better for having read it.   Let me share the crux of the book’s message and how it connects with the financial planning work we do for our clients. The book starts as a history lesson (shocking I would find that interesting, I know) and a great anecdote.  Right after WWII, the US Air Force was testing new fighter jets and dealing with a spate of unexplained crashes – seventeen in just one day! – that were perplexing to the brass because it was not due to mechanical failures. Backing up, starting in the 1920s all military jet cockpits had...
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Apr
07
Don’t Get ROB’d
The start of the 2017 baseball season this week has inspired me to reveal a personal secret, so long as you as you keep it between us. This Saturday (April 8th) I will participate in the 29th annual Equitable Rotisserie League fantasy baseball auction.  I am one of the eight founding members (of twelve team owners).   Equitable was the name of the bank in downtown Baltimore at which a gaggle of geeks working in the bank's accounting department formed our fantasy league back in April, 1989.     For the uninitiated, Rotisserie baseball is the original fantasy sport.  We are purists, hueing to the original Rotisserie handbook rules as closely as possible.  And it does interfere with team loyalty.  I have been a diehard Orioles fan for...
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Mar
31
Addition By Addition
I have always liked the maxim "addition by subtraction" – rid yourself of toxic people or things around you and it can allow you to regain your mojo and prosper again. Well, Harvest Rock Advisors is building on our momentum by adding more talent to our team now, not later. The "subtraction" will hopefully come from lifting the ceiling of complexity that is settling over our practice as we strive to serve clients well, build our brand as a premier local wealth services firm, grow, and better manage the mind-boggling number of tasks it takes to run a boutique independent wealth services firm these days. Earlier this month, two fellow Cambridge Investment Research professionals, Mel Trumble and Bryce Schafer joined the Harvest Rock...
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Mar
24
Epic Fail
Did you see happen to see the news about the Wheel of Fortune episode this week now being referred to as the "epic fail".  Well, at least in the game show world.   In this particular show, the word puzzle game was the classic Broadway play and movie "Streetcar Named Desire" and contestant "Kevin" was in the driver's seat.  He had the wheel, had just correctly guessed the penultimate letter in the puzzle and was down to one spin to guess the final letter.  All that was left to solve the puzzle was an unguarded layup – the "M" in "Named".  So what does rocket scientist Kevin do?   After a nice $650 wheel spin, he announces with confidence the letter "K" - A Streetcar Naked Desire".  After the next contestant slam dunks the letter "M" for...
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Mar
17
Ransomware
I am sadly running low on life milestones to celebrate with our daughter Abby; we just celebrated a major one last Sunday – her 21st birthday.   Now, as (bad) luck would have it, her birthday fell on the Sunday at the end of her spring break.  So Carrie and I did what any immature parent would do:  We followed Abby back to Pittsburgh Sunday afternoon so she could buy us a drink!  We had a fun twenty-hour jaunt across the commonwealth and back celebrating her rolling passage into adulthood.  A regular theme of the parental guidance we have conveyed to Abby references Woody Allen's famous quote: "80% of success (in life) is just showing up".   In other words, get out and put yourself in public situations to create opportunities for good...
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Mar
10
Less Is More – Winning Investment Defense
Last week we had the privilege of hosting leaders from the York County History Center at our office to share the organization’s vision to erect a grand new history museum in downtown York.  It was an intentionally small group of professionals and engaged citizens in the community; it turned out to be a nice evening all around. At present, “YCHC” owns and manages a couple-hundred thousand square feet of museum space across multiple facilities around the city—on par with a major U.S. city - but it is sprawling and woefully inefficient to maintain. As part of their strategic plan, YCHC purchased the old MetEd power steam plant downtown and is poised to start a capital campaign to construct what should become one of the more interesting...
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Mar
03
IRA Bloopers
Maybe I'm getting out more or perhaps it was a boon year for good movies, but it seems there was more interest in the Academy Awards show this year.  I heard of red carpet parties and plenty of discussion handicapping the Oscar candidates.  And that was BEFORE the epic ballot screw up.  During the show last Sunday night, Warren Beatty and Faye Dunaway (forever "Bonnie and Clyde" to me) were on stage to announce, arguably, the most prestigious Oscar award, Best Picture.  Beatty opened the sealed envelope, looked befuddled, hesitated, consulted with Dunaway in confusion and then they tepidly declared La La Land the winner.  As the elated La La Land team bounded up on the stage and accepted the honor, the producers soon realized the...
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Feb
24
Climatology
How about this weather?   We didn’t make any cold weather escape plans this winter and it looks like we won’t be penalized for it.   Once baseball spring training has begun, any cold snaps and/or snow events are much easier to tolerate. I often use a good weather metaphor in our practice:  as an investment advisor, I serve as an investment climatologist more than a weatherman.   The definition of climatology is the science of studying weather conditions averaged over a period of time. We analyze the investment climate in terms of economic, fiscal, monetary, financial, political and other macro-level factors to help make decisions about the direction of future investment patterns, shifting our focus away from the daily capital market...
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Feb
17
Dippy The Dinosaur
Last weekend we made our regular pilgrimage to Pittsburgh to visit our daughter Abby at Pitt and play in our favorite city. Abby now works at the Carnegie Art and Natural History Museum.  We got a private tour of one of the premier museum complexes in the country and stumbled on the story of Dippy the Dinosaur, another interesting chapter in the storied life of Andrew Carnegie. Carnegie's epic bootstraps story, a Scottish immigrant rising from abject poverty to become one of the richest men in history, reads like fiction.  By the way, at its peak value, in today's dollars, Carnegie's net worth dwarfed the fortunes of Warren Buffett and Bill Gates. After building the world's largest steel company, Carnegie sold it to JP Morgan for a...
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Feb
10
Ringling Brothers And The Dow
I was saddened (but not surprised) about the recent news that Ringing Brothers and Barnum & Bailey Circus is shutting down after 133 years.  The circus was formed by the Ringling family in Wisconsin in 1882.   It merged with the Phineas Barnum's circus in 1884 and became a cornerstone of Americana for generations. I recall seeing the Ringling Brothers circus as a kid and we enjoyed taking our daughter Abby to see it as well – good solid family entertainment. Cash flow troubles due to high operating costs, changing consumer tastes and hectoring from animal rights groups all have been cited as adverse business factors that lowered the curtain on Ringling Brothers, but the back story is more revealing.   The phenomenal success of Cirque...
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Feb
03
Ode to the Oracle From Omaha
This week I attended an investment conference and was re-introduced to a funny financial planning video that that is too good not to share.   A Day in the Life of a Financial Planner Unfortunately, I have met this cartoon prospect profile more than once.  It rings true to me and is a sad commentary about we are not teaching our kids financial life skills in high school and that personal finance is not a required part of a liberal arts college curriculum.   This past Monday, HBO aired a most excellent documentary on the life of Warren Buffett, arguably the greatest investor of all time.   Mr. Buffett, his family and lifelong business partner Charlie Unger were all interviewed in depth, telling Buffett's story in a very personal way....
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Jan
27
Arrested Development
One of the all-time funniest television sitcoms is Arrested Development.  First aired in 2003, it ran for three seasons, took a hiatus and Netflix rolled out a fourth season in 2013.  Good sitcoms are stress relief for me and I'm now re-watching this laugh-a-minute series; I am also jazzed about the announcement of a new fifth season that will air later in 2017.  My favorite segment features Scott Baio playing attorney Bob Loblaw (say that several times fast).  In one hilarious scene, he states that he must stay home one evening to compose his Bob Loblaw law blog. Bob and Barb Loblaw is now our official sample client in our financial planning practice.    A shout out to my daughter Abby for introducing me to the show a couple years...
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Jan
20
Hot Chocolate Investing
I ran across a funny headline on the newswire this week about a new scheme by the most nefarious investment con man in history, Bernie Madoff.    Madoff has been busy in prison, crafting a strategy to successfully corner the market for hot chocolate inside the North Carolina federal prison in which he is serving what is, for all intents and purpose, a life sentence. Per the report, Madoff, nearing eighty years old, purchases every pack of Swiss Miss hot chocolate mix in the prison’s commissary and then sells it in the prison yard at a tidy profit.   Per one source, “if you want hot chocolate, you have to go through Bernie”.   Federal prison is the ultimate regulated environment and yet capitalism still can’t be snuffed out – funny....
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Jan
13
National Champs!
The blog title is not what you may think.   I know, there was a helluva NCAA 1-A football championship game this past Monday night, with Clemson beating Alabama in thrilling fashion.  The OTHER major college football championship game, however, was played last Saturday in a Dallas, Texas featuring my alma mater, James Madison University.    JMU handily beat Youngstown State 28-7 and was crowned 2016 1-AA national champs.  Their only loss this past season was to 1-A North Carolina and they dominated their 1-AA opponents all year.   My wife Carrie, daughter Abby and I all flew to Dallas to attend the game and it truly was a memorable experience.   Well, except for tailgating at 8:00AM in ten-degree weather – in Dallas!   The scene on...
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Jan
06
Hindsight is 50 - 50
I trust everyone is off to a nice start to 2017; all the best to you and yours for an outstanding year. Not sure about you, but I enjoy a good malapropism and a mixed metaphor.  There is actually a term – malaphor – to describe the fusion of these two forms of jumbled English.   “Is a bear Catholic?”, and “Fish or get off the pot” are a couple malaphors I like to utter to draw an amused response.   The king of the malaphor was, of course, the great Yogi Berra.  Here’s a just a couple of his pearls: “We made too many wrong mistakes.” “He hits from both sides of the plate.  He’s amphibious.” “When you come to a fork in the road, take it.” But my all-time favorite comes from Magic Johnson, the hall-of-fame basketball player....
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Dec
30
Is It Debit or Credit?
Hope everyone is enjoying the holiday season.  In this final blog post of the year, I, like many, officially put a fork into 2016 – what a wild and woolly year.   Despite some stiff industry headwinds, we eked out a solid year in our practice, with nice growth, some compelling new wealth solutions and an enhanced client service model – but it was pockmarked with a lot of needless frustration caused by goofy industry forces.   We did suffer one last personal zinger to end the year.  Our daughter Abigail is an art / history major at Pitt and this fall she landed a sweet job at the Carnegie Art Museum, one of the finest museums in the country.   The proud parent part is all well and good, but not the part where Abby had to leave York...
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Dec
19
Trump Bump
Some of the best times are the unscripted ones.   Last Friday, Carrie and I ran down to our alma mater, James Madison University, to watch JMU host a NCAA quarterfinal playoff football game.  After JMU thrashed their opponent 65-7, we stayed overnight and worked our way back to York, but we were not in a hurry.    UPDATE:  JMU is playing in the 1-AA national title game on January 7 after trouncing #1 North Dakota State—go Dukes! I have always wanted to visit the Cedar Creek National Battlefield in Middletown, Virginia, located in the northern Shenandoah Valley, just south of Winchester.  I convinced Carrie to swing by for a "quick" visit on the ride home.  Cedar Creek was a pivotal Civil War battle fought in October 1864, barely won...
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Dec
09
Domicile Planning
We took a detour returning from a Pitt game this fall and stopped in to visit Fallingwater for the first time.  Fallingwater is the famous mountain home designed and erected by the renown architect Frank Lloyd Wright during the Depression.  It is located about 45 miles southeast of Pittsburgh in a picturesque corner of Pennsylvania.  As the picture I took below will attest, it is definitely worth a visit.   In fact, I learned that Fallingwater is on the Smithsonian Institute's list of "28 places to visit before you die" - I don't disagree. After dragging my wonderful wife to a cold football game the night before, my goal was to rebuild some spousal points by spending the morning touring a vacation home museum - without complaint....
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Dec
02
Unaffordable Care Act Planning, Part II
Tags: ACA; Obamabcare
I wrote about the looming 2017 individual health insurance plan crisis a few weeks ago – and was too optimistic.   If you have individual health insurance and have not focused in on your 2017 coverage, run to your computer now and visit Healthcare.gov to get up to speed - the enrollment deadline for individual coverage starting January 1st, 2017 is December 15th. Health insurance premiums for 2017 Affordable Care Act ("ACA") health plans were published for South Central Pennsylvania last month and the rates are worse than awful.  My sense is that, for some reason, our region fared worse than other Pennsylvania insurance markets, especially Philadelphia and Pittsburgh.  Despite our reputation as "Pennsyltucky", South Central...
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Nov
23
Thanks Gifting
With all due respect to the Pilgrims and their abundant autumn harvest of 1621, the Thanksgiving holiday (my favorite) traces its formative roots to York.    To be sure, the first national day of Thanksgiving was proclaimed by the nation's first organized government in York (towne) on November 1st, 1777, to be celebrated on Thursday, December 18, 1777. The proclamation was composed by Continental Congress member Samuel Adams, better known as the "Father of the American Revolution" (and a pretty good beer brand).  It advocated a day of public thanksgiving among all the states in the confederation to celebrate the key military victory over the British at Saratoga, New York in October 1777. On December 18th, General George Washington...
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Nov
18
Remember Marcellus Shale?
I took a fun field trip to visit a natural gas well pad last week in Western Pennsylvania.  It was a nostalgic trip for me to revisit a gas well site, more on that below. I took the picture shown below last week during my visit to see operating Marcellus horizontal wells on a well pad fifty miles north of Pittsburgh.  Shown are three (of four) lateral gas well heads (the red apparatus is the wellhead and is called a "Christmas tree").   Each lateral well extends out more than one mile from the well pad!  Horizontal drilling has been aptly coined "squeezing gas from a rock". These wells sit on a five-acre pad which can collectively drain up to one-thousand acres of natural gas.  Horizontal drilling is more aesthetically friendly than...
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Nov
11
Earthquake
On Election night, I had a nice dinner out with my wife Carrie and settled in to watch the election results.  I had no interest in witnessing the expected coronation of Hillary Clinton.   I considered the presidential race to be officially over after the Republic convention last July and had resigned myself to years of enduring Bill Clinton's indiscretions and endless Clinton Global Foundation congressional hearings. For the record, I voted early Tuesday but left the top ballot blank, out of utter contempt for two awful choices and instead turned my attention to the down ballot contests. My interest Tuesday evening was focused solely on the outcome of the tight US Senate contest.  From an economic / investment point of view, divided...
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Nov
04
Unaffordable Care Act
It has been a paradoxical week for the Cubs.  They finally won the World Series in an epic series this week, which brought great joy to the city of Chicago (which could use some good news). But sad on another level because their championship drought is no longer a national phenomenon.   The Cubs are now just a team that has a pedestrian one championship in 109 years – big whoop.   Anyone want to buy my Cubs cap?  It truly has been a sad couple of weeks for many folks receiving their 2017 individual health insurance premium notices.  If your current policy is not cancelled for 2017, the premiums are likely spiking to dizzy new heights, as many feared would happen earlier this year. They say your first wealth is your health.  Indeed, it...
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Oct
27
Lovable Losers
What a terrific World Series matchup this season.  The two teams, the Chicago Cubs and Cleveland Indians, who have played a combined 174 seasons without a World Series championship, square off this week in the 2016 World Series.  One of these historic streaks must come to end soon. The Cubs hold the most ignominious record in all of sports, the longest non-championship streak, which now stands at 108 years.  In fact, the Cubs last won a Word Series in 1908, six years before their home field, Wrigley was even built – remarkable. Cleveland has been inept in its own right, last winning the World Series in 1948.  One player from the Cleveland team is still alive giving interviews about the ’48 Series – at age 95! The Cubs’ multiple...
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Oct
21
Have You Seen My COLA?
Hope everyone is enjoying the nicest Indian Summer weather I can remember.  There's no finer place to live than south central Pennsylvania in the fall.  And my Pitt Panthers are an entertaining 4-2 this season, but away games at Clemson and Miami loom in November (gulp). For the second consecutive year, however, October has brought anguish for senior citizens eager for an upward adjustment in their Social Security benefit checks in 2017. This week, the Social Security Administration announced the 2017 cost of living ("COLA") benefit increase for 2017 and it's an ugly 0.3%.  This comes on the heels of a 0.0% increase for 2016.  Wasn't 0.0% Bluto's grade point average in Animal House?  Neither is good. COLA escalators on Social Security...
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Oct
14
Elvis Meets Nixon And Living Trusts
I had the pleasure of seeing the new movie Elvis and Nixon several weeks ago and give it five stars for its historical entertainment value. This is one of those movies that would have been decidedly stupid if Elvis had not actually pulled up to the White House gate, hopped out of his limousine and insisted on hand-delivering a private note to President Nixon asserting it had national security implications.  Elvis actually did that very thing in December 1970. It turns out Elvis was concerned about the drug epidemic enveloping the nation's youth at the time and he wanted to be appointed a "federal agent at large" (I'm not kidding) and go undercover to help interdict the drug trade.  Without giving away the entertaining back story, Elvis...
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Oct
07
Bad Behavior
Tags: investments
There is so much positive momentum happening in downtown York right now.  Everywhere you turn there is private investment underway all over the central business district. Just this week, the Yorktowne Hotel was awarded a ten-million dollar state grant to help fund a major renovation project.  New apartments, retail, restaurants and microbreweries are sprouting up all over downtown and there is a palpable enthusiasm afoot. When we were looking for our new office location back in the summer of 2013, I was determined to find space that was unique, that ideally enhanced our client experience.  I really liked the idea of a downtown office, but private client parking was non-negotiable. So when I saw our current office, I was sold at first...
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Sep
30
Election Investing Musings
Last weekend, Carrie and I took off to our happy place, the Delaware shore, for a couple days of late summer beach decompression time.  Or so I thought.  I was having a nice weekend until we came out of a restaurant Sunday afternoon in Dewey Beach to find a parking ticket on our windshield - for parking in the wrong direction in a parking lot space!  It was a $30 citation and I was fit to be tied.  The parking lot was half-empty, there was no signage and I have parked in a similar fashion for over thirty-five years without an issue. What the #?!*) is the deal with reverse parking in a parking lot?   I did some homework and learned that parking the wrong way on a street is in fact considered a safety violation at night due to the rear...
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Sep
23
Get the Sensation
I had the privilege of joining the board of directors of the York County History Center this month.  YCHC is a well-run, non-profit organization dedicated to preserving and promoting the history of York County, Pennsylvania.  That's no small task - York County has a rich and diverse story dating all the way back to 1741.  As a bona fide history geek, I am excited to help lead the organization to accomplish a major capital project over the next few years, important both to the organization and the York community.  Check out their website at yorkhistorycenter.org and consider a membership. Here is yet another history nugget about York.  It is often referred to as the nation's snack food capital, with a long history of food production,...
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Sep
15
Don’t Waste Youth On The Young – The Magic of Compounding
Can you believe it has been fifteen years since 9-11?   It seems like yesterday we were living out a horrific, out-of-body experience on a late summer Tuesday morning.  Is it me or does every September 11th seem to record beautiful weather, just like that fateful day fifteen years ago?  This past Sunday the 11th was another glorious weather day, at least in Pennsylvania. The generation prior to mine all knew their precise location when they got word that President Kennedy was assassinated.   My generation knows their precise location when we got word of the first airplane hitting the North World Trade Center tower at 8:46 on 9/11/01. I was sitting in a professional education seminar at a hotel in Harrisburg when someone opened the door...
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Sep
09
Bracketology
I knocked off two travel bucket list destinations in one trip last week:  Hilton Head Island and Savannah.  I highly recommend them both, for different reasons. Hilton Head is a beautifully designed, relaxed beach resort noticeably lacking the commercial tackiness of many mid-Atlantic beaches.   It would make a wonderful retirement nexus, but the summers are Florida-brutal hot, so keep the Pennsylvania bungalow. Savannah is a beautiful city and reeks of history.  It is a port town founded in 1733, eight years before Baltimore's Fells Point (my favorite port).   It is a convenient Uber ride from Hilton Head so you can better "participate" in their colorful bar/restaurant district.   Many of the watering holes are housed in old cotton...
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Sep
02
Pushing On A String
Tags: economics
Quick, name the American who just won the decathlon at the 2016 Olympics this month for the second consecutive time?   Ashton Eaton is the trivia question answer and the lack of media attention regarding his remarkable accomplishment in our sports-obsessed society is downright odd. I admit that I can't muster up interest in the Olympics like I used to.  Partly due to my waning interest in spectator sports in general (still love my college football), but also the corruption, the drugs and outright silly number of "sporting" events.  Dressage is a sport, but not baseball?   Give me a break. Still, Eaton's accomplishment is astounding.   Only two other men have won the Olympic decathlon in back-to-back in its modern form (1912), the first...
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Aug
26
Back to School
Some of you may recall the gnashing of teeth in a recent blog note about having to move my daughter Abby into her new upper floor college apartment in Pittsburgh a few weeks ago. Well, I'm happy to report we successfully pulled off the move last weekend without damaging the moving truck, aggravating my heel spur, pulling a muscle or suffering heat stroke.  One more fun digression before getting back to work. I was recently tipped off that the outfield wall from Forbes Field was still standing on Pitt's campus and I went looking for it after my moving gig was complete.  Sure enough, I found it next door to Pitt's business school, a few blocks from Abby's apartment.  For baseball fans, aside from old Yankees Stadium, Forbes Field rivals...
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Aug
19
Does new DOL Fiduciary Rule Spell SOL?
Glad to report that I made it out and back to Chicago for Cambridge's annual advisor conference last week alive – literally – without incident.   Two days before I arrived was the bloodiest day in Chicago history, with nine murders and over forty others shot.   Chicago is one of friendliest, most interesting cities you'll ever visit and it is disquieting to watch it degenerate into such extreme volumes of violence, especially this summer.  Folks above my pay grade will need to figure out how to stem the unspeakable violence occurring in Chicago - and other cities as well.  Sadly, this is the consequence of inexcusably bad leadership.  For decades, city leaders have abandoned economic policies that retain businesses and attract new ones,...
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Aug
15
Blinded By Science
Looking forward to travelling to Chicago this week to attend Cambridge's annual advisor conference.  The event is loaded with useful presentations and should be a solid return on the time/expense investment.  I fully expect to gather a handful of really good future blog topics and cap the conference with my second visit to Wrigley Field to see the Cubs. This time the team is really interesting, not just the ballpark. I attended (virtually) a different conference recently and one presentation really caught my attention:  trends and breakthroughs developing in the biotech industry. Advances in computer processing technology have fostered remarkable advances in biotechnology, especially over the past decade, with even more promising...
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Aug
05
The Business of Franchising
Omniscient Donald Trump is now dispensing investment advice.  He appeared on television this week advising all Americans "to get out of stocks, just like I did", due to the Federal Reserve's monetary policy.   Really?  Of course, his next comment was the stock market "would go great" if he were elected (oddly, he did not refer to "yuuuge" stock market gains).   I suspect, however, the exact opposite stock market reaction would occur if he does prevail. Not to be outdone, the other knucklehead candidate went full socialist last week, promising "free everything" to everyone", this time espousing free college education for all.  But why stop there?  Why not guarantee a 4.0 GPA?  Graduates would be guaranteed $100,000 salaried jobs, a...
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Aug
01
Retirement Red Zone Investing: The Sequence Consequence
We had a smashing experience last weekend at a family wedding in Virginia.  I know, the typical family wedding is uninteresting, often an obligation, but this one was an unforgettable exception to the rule. The bride and groom were determined to host an unconventional wedding and throw a memorable party, and they succeeded - in spades.  The wedding festival was a two-day outdoor extravaganza, held on Montalto, the mountain top overlooking Monticello, Thomas Jefferson’s estate.  Flip flops and shorts was the appropriate attire. Four excellent bands performed over the two-day party, but the highlight was C.J. Chenier and the Red Hot Louisiana Band.  They are acclaimed as the nation’s premier Zydeco band, a genre of French Creole blended...
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Jul
22
Great Depression Versus Great Recession: Same or Different?
Just finished an excellent book while on vacation:  The Great Depression, A Diary by Benjamin Roth (good grief, who would read such a downer topic to relax?).    Roth was an attorney raising a family in Youngstown, Ohio in 1929.  He diligently wrote diary entries chronicling the devastating impact of the Great Depression on Youngstown from 1929 until the start of World War II in 1941.  It is written as a running list of chronological anecdotes about the personal devastation he witnessed in his hometown, but also offers astute perspective about the machinations of a government flailing to address a national economic crisis spiraling out of control. There's been much commentary contrasting the Great Recession that started in 2008 with the...
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Jul
18
QLAC: A Shiny New Retirement Planning Device
Hope everyone is finding time to enjoy this exceptional run of nice summer weather.  I have been doing muscle building exercises preparing for the day next month that every college parent dreads:  moving our daughter Abby into her first off-campus apartment.  The law of averages would suggest that some college students actually do secure a first floor apartment, but I have never met such fortunate families.  Instead, everyone seems to share my upcoming predicament:  moving stuff into an upper floor apartment unit with no elevator and old, steep, narrow stairwells without air conditioning. Anyway, the fun part of the first apartment project has commenced this summer, which is preparing Abby for an exciting new life phase.  Part of the...
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Jul
07
2016 Mid-Year Review and Outlook: 3rd and 9….
I know it’s not football season yet, but our midyear 2016 outlook must be composed in July, not September and I am need of a good metaphor for this blog note.   So play along with me and picture a beautiful Saturday afternoon in Pittsburgh on September 10th, 2016.  My Pitt Panthers are playing arch rival Penn State Nittany Lions at Heinz Field and it is a doozy of a college football game. It is early in the fourth quarter and Pitt has the ball at midfield in a tight game.  Pitt is winning (of course), but the final outcome is very much in doubt.  It is now third down and nine yards to go for a first down.  Suffice it to say it is critically important that Pitt’s offense converts the third down play, to keep the drive alive and score again...
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Jun
30
Social Security Retirement Benefits: 70 Is The New 62
Sick of Brexit yet?   I haven't seen such a blitzkrieg of headlines and analysis on this topic in well, forever.  I asked a (normally) well-informed client last Thursday (the day of the referendum) how he felt about the United Kingdom voting to exit the European Union; his response was classic, "what vote?"     I don't know about you, but I am fatigued by talking about global disfunction, so let's put on an old comfortable shirt this week:  Social Security retirement benefits. Trivia question:  What percentage of Americans, who first become eligible to start (non-survivor) Social Security benefits at age 62, indeed take those benefits at the earliest possible age? The answer, per the latest Social Security Administration ("SSA") data,...
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Jun
24
Brexit!: Is The Eurozone Brisket?
I was channel surfing the other night and stumbled on the one of my favorite all-time movies, A Fish Called Wanda, and put down my laptop for two hours of stress relief.  It is one of the funniest movies ever and a John Cleese (Monty Python) masterpiece.  It pokes hysterical fun at the prim and proper British, a timelessly funny topic. Speaking of the Brits, yesterday was an important, historic day (it remains to be seen if it proves to be a historically important day).  Europe got hammered yesterday by a firestorm that rolled in off its western coast – Great Britain ("GB").  In a shocking outcome, GB voted to leave the European Union ("EU") – coined "Brexit" - by a comfortable (52% - 48%) margin.  As Joe Biden would put it, this is a...
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Jun
17
Below Zero: The Curiouser and Cursiouser World of Negative Interest Rates
Muhammad Ali passed away earlier this month from Parkinson's disease.  I grew up in the '70s when heavyweight boxing was a wildly popular spectator sport (where did it go?).  Ali was the undisputed giant in the sport, an amazing athlete and overall larger than life figure.  After his storied boxing career, he toned down his controversial act and became a respected humanitarian. As it turns out, comedian Billy Crystal was a close friend of Ali's for over forty years.  Crystal eulogized Ali at his funeral last week.  Do visit YouTube and marvel at Crystal's extraordinary tribute to his friend, sharing some funny and poignant personal experiences (including a classic Howard Cosell impersonation).  The fact that Crystal is Jewish and Ali was...
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Jun
09
Medicareless
Last fall, during the 2016 Affordable Care Act health insurance enrollment season, the best family (of three) health insurance policy we could purchase now costs us $12,000 in annual premium and the Swiss cheese coverage is subject to a $12,000 family deductible!   At least our plan is eligible for a Health Savings Account, whoopee. I am a CFP® professional, yet even I occasionally harbor dark thoughts about dropping our health insurance altogether, pay the modest penalty, then sign up for health insurance once really sick and utilize the hell out of the medical system.  That would be an irresponsible choice, but you can't blame one for trying to plan a way out of this current health insurance crisis. As the ACA health law slumbers in a...
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Jun
02
Trolling for Dividends
Tags: investments
I had the good fortune to attend a business breakfast last week and the subject was a profile on the York Water Company ("YWC").  As a history geek who manages investments for a living, I was blown away by YWC's storied history. As it turns out, YWC is the oldest investor-owned utility in the nation!   Founded in 1816 to fend against devastating structure fires in town, YWC is hailed as the nation's first public-private utility enterprise.  Despite its successful history, YWC remains a peculiarly small utility company, providing drinking/potable water only to portions of York County. The story gets better:  YWC has paid a consecutive cash dividend for two-hundred years, the longest streak in US history!  (I am forced to restrain the...
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May
27
“Elderhood” Planning
I attended the 2016 annual meeting for the York County Community Foundation this week and heard a provocative presentation by Dr. Bill Thomas, a geriatric physician and internationally recognized expert on aging.  His entertaining message was a plea to embrace your own aging and to respect the wisdom and life experience of the elderly.   Thomas has pioneered an acclaimed communal living alternative to the institutionalization of the elderly and actually coined the term of this week's note – elderhood – the phase of life ensuing the rat race known as adulthood. While I agreed with his narrative, in fact he made this old codger feel wiser and more worthwhile, as a financial planner, I come at elderhood from a different angle.   We must...
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May
20
Deflating The Disinflation Myth: Personal Inflation is Real
We shook things up a bit this year recognizing our clients' birthdays.  Instead of a card, we are sending a report with trivia describing life in the US in their birth year.  One of the features is a price list of some popular consumer items back in the day. The report has been well-received and is stoking some fun conversations.  At a recent meeting, one client, now in his 70s, shared a picture and receipt for the fine looking new 1957 Pontiac sedan – purchased for $5,600!   I could not come up with a finer example of the financial impact of compounding inflation over time. The simple definition of inflation is that it is a measure of the decrease in purchasing power of money over time.  The consumer price index (CPI) is the US...
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May
13
A Prince Of An Estate Plan – Not!
estate planning; wills
2016 is shaping up to be remembered as the year of musician mortality.  Accomplished musicians across all genres are falling like rocks, to the point of ridiculousness:  David Bowie, Glenn Frey (Eagles), Merle Haggard, Frank Sinatra, Jr., Keith Emerson (Emerson Lake & Palmer), Billy Paul (remember "Mrs. Jones"?), Maurice White, awesome lead singer of Earth Wind & Fire and even George Martin, the fifth Beatle.    The biggest musical star to succumb, however, is Prince Rogers Nelson, who passed suddenly just a few weeks ago at the prime age of 57.  A message to Van Morrison:  take your vitamins! While not a raving fan of Prince's music. I will admit that a couple of his songs are guilty pleasures.  Music is a business, so I do admire his...
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May
05
Your Most Important Asset
disability insurance; social security; risk management
Next week marks thirty years (!) since my college graduation.  It seems like just yesterday I was a 175 pound, freshly-minted accountant sporting a cheesy '80s style mustache.  I blinked and thirty years have elapsed and sixty pounds have been added to my frame – how? By the same token, after several successful careers, I have found my niche as a Certified Financial Planner®.  I bring thirty years of experience, a graying (but still full) coif and much wealth management wisdom to the table each time I sit down with a client – and I can still see my shoes! You may have noticed an eye-popping headline last month:  Per a new Federal Reserve study, in the event of a financial emergency, 47 percent of Americans would have trouble coming up...
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Apr
29
Gold Humbug
Tags: gold; investments
gold; investments
Helium walks into a bar and the bartender says "We don't serve noble gasses in here" - but Helium doesn't react.  Okay, someone had to giggle.  How about this one:   Two chemists go into a restaurant.  The first one says "I'll have an H2O."  The second chemist says "I'll have a H2O too" - and then dies.   Someone stop me, please. Writing a pithy note about gold investing is a tall order – what a complex asset – but I'll take a stab at it.  By the way, silver is a separate topic for a future blog. Gold is a precious metal that has been highly prized for thousands of years and for good reason.  It is malleable, ductile and lauded for its lustrous color.   It doesn't rot or rust, can be mixed with other metals and maintains its desirable...
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Apr
22
Wealth Transfer Wave: Retirement Assets
financial planning; inherited IRA; retirement planning
Decades of cumulative IRA contributions, 401k deferrals, employee match dollars, profit share contributions and rollovers, all advantaged by long-term tax-deferred growth, plus the demographic bulge of aging retirees, have coalesced to create a massive wealth transfer phenomenon now playing out – inherited retirement assets. We have a growing number of clients who are inheriting retirement accounts from their parents and the financial windfall can easily turn into estate transfer and income tax problems if mishandled.    In fact, retirement assets are where income tax and estate transfer planning intersect; simple mistakes can lead to substantial adverse income tax consequences down the road for the heirs. The cardinal estate-transfer...
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Apr
15
Woe Yield
investments; stocks & bonds
A mathematician, an accountant and an economist all apply for the same job at the Federal Reserve.  The interviewer calls in the mathematician and asks "What does two plus two equal?" The mathematician replies unequivocally "four."  The interviewer then calls in the accountant and asks the same question, who answers "on average, four - give or take ten percent - but on average, four."  Then the interviewer called in the economist and poses the question again.  The economist gets up, locks the door, sits down next to the interviewer and says "what do you want it to equal?" The green eye shade economists at the Fed have been running an experiment in monetary policy the past ten years.  In started in earnest in 2006, when signs of the...
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Apr
07
Tenants, Toilets and Trash
investments; real estate; REIT
Just returned from a conference with a timely update on investment real estate.  It seems that after a healthy market correction over the past eighteen months, many real estate portfolios are now trading at a discount to their fair value.   I have long advocated investment real estate as part of a diversified investment strategy.  Often referred as the fourth asset class – after cash, stocks and bonds – investment real estate has an impressive track record of generating solid risk-adjusted return over decades. The problem lies in the definition of investment real estate.   A common mistake is viewing your home as an investment.  Sure, there have been inflationary periods and housing bubbles that have driven the price of home real estate...
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Apr
01
Alternative Capital
alternative capital; crowdfunding
The first quarter of 2016 came to a close this week and investors have been diagnosed with whiplash.  In fact, after falling 11% the S&P500 Index rallied to finish slightly positive for the quarter.  Even better:  the Dow recorded its largest intra-quarter rebound since 1933!   The US stock market seems to be gyrating around Fed Reserve monetary policy speculation, which has been a moving target since December.  Shaping up to be a scintillating investment landscape over the rest of 2016. At a recent investment conference, I learned that inside large national banks today there are 1.1 compliance professionals on staff for each lending professional.  I mentioned this startling statistic to a friend who works for a large national bank, who...
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Mar
24
Tax Tips and A Movie
financial planning; HSA; IRA; tax planning
Made time to watch the movie The Big Short last week.  It plays like a documentary and is an entertaining dramatization of the U.S. housing bubble/crash almost a decade ago, from which we are still recovering.   I am an unapologetic free-market capitalist, but the retelling of the unscrupulous practices of some of the most recognized investment banking firms on Wall Street was uncomfortable to watch.   The fact that a handful of professional investors made a fortune shorting the mortgage loan market by showing the courage of their convictions helped make the story all the more interesting.  In sum, it was a really good movie that did an effective job explaining a complicated financial scheme in understandable terms.  Not sure what the...
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Mar
18
Paid Forward
financial planning; investments; stock market
Last week on March 9th marked the seventh anniversary of the current stock bull market – and what a bull market it has been!  At eighty-four months, it is the third-longest in history – only four months younger than the original I-phone - and one of the most prolific wealth creation episodes in history.  The run started with a bounce off of an equally historic bear stock market in 2008 that spilled into 2009.  Those early intrepid investors were handed a rare opportunity to buy stocks at liquidation prices.  By the end of trading on Friday, March 6th, the S&P500 Index had collapsed 57% from its peak in October 2007.  As of last week, the S&P500's cumulative return was a mind numbing 215% off of the March 2009 bottom. While traditional...
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Mar
09
Punched In The Face
elder care planning; financial planning; retirement planning
Just finished a most interesting book about Jeb Stuart, the brilliant / controversial Confederate cavalry general.  It chronicled, in excellent detail, his cavalry's epic marauding invasion through the south central Pennsylvania countryside in the days leading up to and even during the battle of Gettysburg in the summer of 1863.  Cavalry had one primary job in the Civil War – to serve as the eyes and ears of the army - and Stuart had excelled in this role while also obstructing the US Army of the Potomac on a regular basis – at least until that point in the conflict. Part of the Confederate northern invasion plan initiated in June 1863 entailed Stuart separating from the main army, crossing into Pennsylvania around/ahead of the Northern...
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Mar
02
Double Down
Tags: investments
investments
Celebrated twenty-five years of marriage last week with my wonderful wife Carrie.  Leading up our anniversary, I had joked about the longest sentence in the English language:  marriage.  As I reflect seriously on the ingredients to a happy marriage, it simply boils down to luck and teamwork.                                             Speaking of luck, we marked the occasion with our first ever trip to Las Vegas to experience it fully before we get too old.  Too late!  We had fun, but I blame the time zone change for us petering out so early each evening.   I also sheepishly admit that I had never gambled in a casino before and was determined to try my hand at Blackjack while visiting the gaming Mecca.  I did some research on Blackjack...
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Feb
25
A Crude Reality
investments; Oil & Gas
China poured more concrete from 2011 to 2013 than the United States did in the entire 20th century.  Let me repeat, China poured more concrete in three years than the US did over a prosperous one-hundred year period!  A staggering statistic on many levels and it helps to explain the current bear market dynamics of many global commodities, including crude oil. Energy, mainly crude oil and natural gas, has been a gloomy investment topic for eighteen months now.   Like other commodities, the price of crude oil experiences wide price swings in times of shortage or oversupply. Due to a strange confluence of factors, the barrel price of crude oil has declined over seventy percent since late 2014.  The unexpected swoon in oil prices has...
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Feb
19
Got Wealth Advisor?
financial planning; wealth advisor
We are living in most interesting times.  I just read an article projecting that, within thirty years, robots will replace 50% of all low(er) skill jobs globally, creating a massive humanitarian crisis that may even threaten the species.  Sounds like a future blockbuster movie!   Back to the present, as I wrote about last fall, the financial advice industry is already being buffeted by artificial intelligence with the advent of "robo-investing".  Despite a raft of foreboding media articles on the topic, a true wealth advisor is not overly concerned about being replaced by a robot, at least any time soon.   It stands to reason that comprehensive wealth services and meaningful client relationships is now and will remain a value-added...
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Feb
11
Lost Claim: Major Social Security Benefit Change Deadline Looming
financial planning; retirement planning; social security
Retirement planning is about to get harder folks, thanks to some old-fashioned political sausage-making in Washington last fall. Buried in the Bipartisan Budget Act of 2015, which, like most legislation this day and age, was slapped together and rushed into law last November, were some significant and surprising changes to the Social Security retirement ("OASI") entitlement program.  Social Security needs a comprehensive, thoughtful overhaul, not these piecemeal changes that fall out of backroom political deals and are a blindside to Baby Boomer retirees. The most significant (and adverse) change is the termination of a popular benefit-claiming strategy referred to as "File and Suspend".   Introduced as part of a law change in 2000,...
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Feb
03
College Planning Is Retirement Planning
college planning; financial planning
One of the best lines from one of the best (the best?) comedy movies of all time, Animal House, is uttered by John Belushi, better known as fraternity brother Bluto, who laments "seven years of college down the drain" after Dean Wormer tosses the Delta Tau Chi fraternity out of Faber College. When you consider the extraordinarily high cost of higher education today, it doesn't take a seven-year college career to worry about the financial implications of attending college, both for parent and student. Now that February 1st has come and gone, it is now prime financial aid application season, so it seems like an appropriate time to discuss college financial planning issues. Not only am I dealing with this financial issue personally – my...
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Jan
27
US Dollar: Bull or Bubble?
financial planning; US economy
If you are reading this blog you have survived the epic Blizzard of 2016.  I am always skeptical about a forecasted "historical" weather system, but this week's storm was real and spectacular.  Surprising that a major weather event can still bring our advanced society to its knees. In this age of rolling asset / investment bubbles, the US dollar looks to be next in line.  The "greenback" is enjoying its strongest rise in value in forty years and this bull run is causing short-term distortions everywhere you turn, both good and bad.  For example, if you are planning that long coveted trip to France, the price is much cheaper now than a few years ago.  Tell me about it.  The dollar has rallied 17% against the Euro in just the past year!...
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Jan
22
Be The Boss In Retirement
Baby Boomers; financial planning; retirement planning
Before I get into this week's blog topic, let me acknowledge yet another unpleasant week in the global stock markets.  "Worst start to the US stock market in history" is an impressive accolade.   Let's start with a quick group therapy session, building on our 2016 Outlook blog ( http://harvrock.com/Blog.aspx?acId=116114 ) earlier this month:   Economy, interest rates and corporate profits drive the direction of the U.S. stock market over time, right?   So what has changed in this regard since December 31st: 1)      Interest rates?  Short term rates unchanged and long-term rates stable. 2)      Corporate profits?  Initial earnings reports released so far this month for 4Q15 are favorable; 3)      Leading economic indicators?  On...
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Jan
15
Budget This
budgeting; financial planning
Remember Robert De Niro and Billy Crystal in the movie Analyze This?  A really funny movie about a mild-mannered psychiatrist forced to counsel a mafia gangster about his "problems".   There are several memorable quotes, but, unfortunately, all are too colorful to share for laughs in a professional blog.  The film, however, is definitely worth a watch on NetFlix. In practice, I sometimes feel like therapist Crystal counseling folks about good financial management.   In fact, even the term "budget" can be a four-letter word because it conjures of images of accounting drudgery, self-sacrifice and delayed gratification.    Since it is New Year's resolution season, seems like a good time to talk about better financial management as a...
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Jan
07
2016 Outlook – Murky With A Chance of Cloudiness
financial planning; market forecast; stock market
Happy New Year.  Wishing you and yours a healthy and prosperous 2016.   Situation is back to normal at the Sutherland estate after a nice holiday, daughter Abby back "studying" at Pitt and the budding anticipation for spring training, now only seven weeks away. I am writing our 2016 Outlook right after a rather inauspicious start to 2016 this week.  China has become its own market barometer it seems, driving attitudes about global stocks, at least in the short run.  Concerns over the decelerating Chinese economy this summer precipitated a sharp global equity market sell off and it has re-surfaced as a real headwind for 2016. Before I proceed, a word about "market outlooks" in general.  I have worked in the investment profession for...
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Dec
31
Cyber Risk Management – The Encore
cyber security
Happy New Year!  All the best to you and yours for a prosperous 2016.  Next week we will put forth our 2016 outlook.  This week I am re-posting a note from late August that did not pass many eyeballs (peak vacation season I presume).  I don't mind saying it was a rather useful post, with helpful tips on managing cyber risk, so we are reprising now in pursuit of more eyeball volume. We consider ourselves to be professional risk managers, insulating our clients from a variety of perils. An increasingly serious risk category that we are confronting on their behalf is cyber fraud.  Modern technology is awesome, but it does have an underbelly – cyber theft of your personal data.  Each week seems to bring another headline about cyber attacks...
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Dec
23
Gifting With a String Attached
charitable giving; financial planning; tax planning
Sadly, our beloved family cat of thirteen years, Figaro, expired earlier this year.  We made it about six months before the drumbeat began about getting a new cat.  I put my foot down - and now we have two kittens, Harvey and Rocky.  I aim to anoint them our practice mascots to deduct their wet food as a business expense (just kidding). In advance of their arrival, wife Carrie and daughter Abby patronized the pet store to load up on the newest feline toys:  Catnip-laced rodents, a laser pointer and sundry other shiny objects.  Now that the boys are settled in, their favorite toys?  Abby's hair ties, plant leaves and cardboard of course.  How irritating it has been to re-learn the lesson of Abby's toddler years, watching her play with the...
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Dec
17
Whole Life Insurance – A Comeback Story
financial planning; insurance
Everyone loves a good comeback story.  As a shallow male, I naturally draw my comeback examples from the sports world.  The best sports comeback all time (let the debate begin) has to be the Cleveland Indians overcoming a twelve run deficit against the best team in baseball, the Seattle Mariners, in just three innings and then winning the game in extra innings back in 2001. Or how about the Buffalo Bills overcoming a 35 point second half deficit to beat the Houston Oilers in a 1993 pro football play-off game – accomplished by their backup quarterback no less! My favorite (because I watched it) was the Auburn-Alabama football game in 2010. Alabama was up 21-0 before I could even open a beer, yet Auburn clawed back to win 28-27, on their...
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Dec
09
RMD ABC’s
financial planning, RMD; retirement planning
A financial advisor wants to buy a horse for his daughter and negotiates the purchase of an old mare from a local farmer for $100.  The advisor pays the farmer in cash and when he returns a couple days later to pick her up, the farmer informs him the horse has died.  The advisor asks for his money back, but the farmer refuses.  "Well then, I would like to take the horse with me" the advisor says, and the farmer, confused, obliges. The two meet up again several months later and the farmer asks "whatever happened with the dead horse?"  The advisor said he sold it for a $898 profit.  "I held a raffle to win a horse for $2.00 per ticket and sold 500 tickets".   Stunned, the farmer asks: "Didn't everyone get mad at you when they found out...
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Dec
02
Yuletide Financial Planning
financial planning; investments
No, not more advice on how to make a scented gingerbread wreath to adorn your car's rear view mirror.  Not channeling my inner Ebenezer Scrooge, but there are some things that need attention this December besides just holiday preparation.  With year-end 2015 fast approaching, it's time to tidy up your finances before 2016 and here's a handy checklist to help out.  ·         Harvest Investment Losses.  2015 has been a see-saw experience for many investment classes – some up, some down.  If you own an investment of an IRA, Roth IRA or retirement plan and its current market value is now less than you paid for it, the IRS will grant you a nice tax gift this holiday – if you are savvy and seize it.   By selling it in December, you would...
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Nov
25
QTIP – Not Just For Ear Hygiene
Happy Thanksgiving!  I find myself feeling more grateful as I methodically gray, appreciating life’s gifts more fully, even after all the pains and irritations.  I am feeling especially blessed for the pure blind luck of being born an American.  Witnessing all the chaos around the world this month, it makes one appreciate our imperfect culture of freedom, community and independence a little more (at least it should). So what’s up with this odd blog title?  While the traditional QTIP is a practical little instrument, I am much more interested in the estate planning acronym:  Qualified Terminal Interest Property trust. One the most difficult challenges in estate planning is figuring how to leave inheritances to your family, not your...
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Nov
20
(Un) Health (y) Insurance
A man walks into a doctor's office.  He has a cucumber hanging from his nose, a carrot sticking out his left ear and a banana hanging from his right ear.  "What's the matter with me doc" the man asks.  The doctor replies "you're not eating properly"… They say the first wealth is your health.  Indeed, it is difficult to plan your future if your personal health is a concern, so “eating properly” and taking care of yourself on many levels becomes increasingly important on the march to retirement. We are now in the middle of the Affordable Care Act (“ACA”) health insurance enrollment period for 2016.  The health insurance premium rate increases and rising policy out-of-pocket maximums coming in 2016 are unsettling, to be sure.  I admit...
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Nov
12
Mr. Roboto, Financial Advisor?
A childhood television memory of mine was the show Lost In Space, a short-lived science fiction series on CBS in the late 1960s.  The story line is about the astronaut family of Dr. John Robinson, who, accompanied by an Air Force pilot and a robot, leave an overpopulated Earth in a spaceship in search of a planet to colonize. “Robot” was a machine endowed with superhuman strength and futuristic weaponry, but often displayed human characteristics, such as laughter, sarcasm and sadness; it even sang and played a guitar.   Seems like yesterday that I watched each episode rapt as Robot uttered:  “Warning, Danger Will Robinson”.  Footnote:  Lost in Space is not available on NetFlix, but you can see enough of it on You Tube to realize it is...
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Nov
06
Forghedaboutit
Timing is everything – or nothing.   Last week, I wrote about the specter of a massive Medicare premium increase for an unlucky group of Social Security beneficiaries in 2016 and the need to plan around this rather unfair development, all caused by the lack of a COLA increase on Social Security benefits for 2016.   Well, never mind.  One day after I posted last week’s blog – one day! – Congress passed and on November 2nd Obama signed a hastily-crafted budget law (is there any other kind these days?) – the Bipartisan Budget Act of 2015 - with some major Medicare and Social Security law changes that no one saw coming.    The bill’s rescission of the Medicare 2016 premium hike is good governance, the Social Security claiming changes,...
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Oct
28
No COLA Can Be Unhealthy
At least financially speaking, should you happen to be enrolled in the Medicare health insurance program, 2016 may cause heartburn.  Unlucky enrollees may catch a peculiarly tough break next year due to a quirk in the Social Security law that will result in sharply higher Medicare premiums for them starting this coming January. The planning moves to avoid the premium spike for Medicare enrollees are limited, so my advice is to vent and/or pour another cocktail.  However, there is a planning window for those of you eligible for Medicare contemplating retirement in 2016.  Exploiting those kind of planning opportunities is why we exist. For all of you “youngsters”, Medicare is the social insurance program providing government-sponsored...
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Oct
22
Toxic Charity
I still enjoy the old joke "Give a man a fish and he'll eat for a day, teach a man to fish and he'll sit by the lake in the shade and drink beer all day".    I took a break this past summer from reading finance on the beach and instead read a thought-provoking book, Toxic Charity, by Robert Lupton. Carrie had read the book and had been bugging me to do as well.  It tackles a taboo subject matter: intractable poverty and the inefficacy of welfare programs and charity to "fix it".  The theme is that well-intentioned Americans go about traditional charitable work all wrong.  In fact, Lupton's sub-title for the book is controversial:  "How churches hurt the ones they seek to help". Lupton is no conservative hack.  He worked over forty years...
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Oct
15
Ghosts of 2008
Halloween is around the corner.  Autumn is my favorite season, but Halloween does not gin up much interest.   I do find the popular costume trends interesting and 2015 will not disappoint:  looks like the costume winner for 2015 in a landslide is……..Donald Trump’s hair.  Even scarier than The Donald’s coif is the performance of the U.S. stock market in third quarter of 2015.  The sharp stock market correction in August and September validated the fears of many investors still haunted by the horrifying bear market of 2008 and 2009.    During one of the great historic bull market cycles since 2009, investors have had one eye on the exit the entire time.   The impressive U.S. stock market ascent since 2009 has been referred to as one of...
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Oct
01
Social Security Blanket
Baby Boomer demographics are stunning to behold:   Since 2011, ten-thousand Americans have turned age 65 every single day and this wave of seniority will continue uninterrupted for fifteen more years!  The implications of turning age 65 are multi-faceted:  retirement, elder care, investment, pension, Medicare, Viagra, grandchildren, travel and Social Security. Not a bad time to be a financial planner, like fishing in a barrel, right?  Well, I often joke my job is fixing broken financial plans and unfortunately, by age 65, too many folks have made irreparably bad retirement decisions.   One of the most common mistakes that I see are poor Social Security benefit choices. Social Security is a popular social insurance program started in...
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Sep
23
Oil Slick
Just returned from an oil and gas investment conference in Texas (where else?) last week and want to share some insight into the current state of the global oil industry and some perspective for investors moving forward.  I will address natural gas in a future post. Before that, I have to say how was impressed I was with Dallas.  It was clean, thriving city with many cool restaurants, great steak, the nicest people and a happening night life.  If I could only stay awake to experience night life again!  In August 2014, a barrel of oil cost over $100 per barrel.  On Friday September 18th, you could purchase the same barrel for $45 - a breakneck drop in value that has caused much pain and angst with energy-related investments.   The price...
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Sep
16
Your College Kid Is No Longer Your Child
As a parent of a child who has reached the age of minority, I have experienced the weird personal sensation of having morphed into a legal "stranger" to my daughter Abby for all matters legal, financial, educational, and medical.  Even though I am still a key provider and protector, the fact of the matter is that I have lost almost all legal rights to intervene on her behalf – without key legal documents in force. This is especially frustrating when it comes to children attending college away from home, because your child still seems like a dependent in many respects.   We have seen client situations where a child attending college away from home needed medical care and the health care provider refused to divulge even basic information...
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Sep
10
Retirement "Smile"
A misleading blog title, I’ll concede.  I used “smile” as a pleasant sounding decoy to hook more eyeballs to read about a key component of retirement planning:  the trajectory of your expected spending during your retirement years and its influence on your planning now. The bottom line is that you may be in store for a higher quality retirement lifestyle than you might otherwise expect given the same level of retirement resources – thank the smile. I have been constructing and managing retirement plans for many moons and my personal experience working with clients “in the trenches” managing retirement income has always differed from the traditional financial planning textbook. Conventional retirement planning wisdom is quite linear:...
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Sep
02
Cyber Risk...Management
We consider ourselves to be professional risk managers, insulating our clients from a variety of perils. An increasingly serious risk category that we are confronting on their behalf is cyber fraud.  Modern technology is awesome, but it does have an underbelly – cyber theft of your personal data.  Each week seems to bring another headline about cyber attacks leading to large databases of personal information being compromised.  We take the security of our client’s personal information as a priority duty and you should take your own cyber security very seriously as well. We have heard unfortunate stories about folks victimized by various identity theft schemes and the total lack of fun it is to repair the damage.  The technology...
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Aug
24
Sailing and Rowing
Fun times in the stock market, eh?   Along with many other professional market watchers, we have been expecting a meaningful stock market swoon for a few years now.  Just like a broken clock is right twice per day, the much anticipated market correction finally arrived in dramatic fashion.  And, of course this correction starts knowing that I was preoccupied at Cambridge’s advisor conference last week and today taking Abby back to college! So now the new anxiety is that the sudden market correction could be the start of a new bear market, unless, of course, it is not!   For unforeseen reasons, our clairvoyance to call the end of the current bull market is unreliable (get it?).   A detailed discussion of the reasons supporting the...
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Aug
18
Not So “Yuan-derful” News
Tags: China
Big news last week in case you missed it:   China’s “Federal Reserve” - People’s Bank of China - devalued China’s currency, the Yuan, by 1.9%.  China’s currency has long been manipulated by their Communist government to suit its needs.  The fact that last week’s devaluation is the largest in twenty years is a big deal as it sends a signal to investors around the globe about trending economic conditions in China. The spin from the Chinese for the devaluation is that is represents another step in its market-oriented reform to allow the currency to float against other major international currencies, as the U.S. and other major trading partners have been pressing China to do for years.  However, this has tripped the BS detector for many...
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Aug
14
Lessons from a Fledgling Entrepreneur
This week marks the two year anniversary of our starting my own wealth services practice, Harvest Rock Advisors, LLC. Needless to say, it has been an adrenaline-filled two years.  There have been several white-knuckled moments, but many more exhilarating ones.   Every day is full and often stimulating; the business has become like a member of our family. Fortunately, due to the support of our loyal clients, a ridiculous amount of hard work, good teamwork and even a little luck, our practice has not only stabilized but is enjoying positive momentum.    We even settled on the purchase of our office condominium just last week, a quite satisfying milestone in our evolution. Now, it far too early for self-congratulation, but when you...
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Aug
05
College Dollars
Our nice summer was mildly interrupted last week with the receipt of the fall 2015 semester tuition bill from University of Pittsburgh, the fine institution of higher learning that my daughter Abby attends. I don't question whether Abby's college degree will be a good investment, but holding that bill does focus the mind on its cost and, as a CFP® Professional, the arduous planning challenge facing families as to how best to fund this goal. There is no universal formula regarding the sharing of the college expense load between parent and child.  Each family unit has different dynamics, values, experiences and financial profiles that makes each higher education funding plan unique. I do, however, advise parents that higher education...
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Jul
29
Scenes from an Italian Restaurant
I read this week that Billy Joel, now age 66, recently took his fourth bride (does her name really matter?), exactly half his age.  Better yet, the happy couple is expecting a baby later in 2015.   All the best for this latest November-May couple. I admit to being a fan of Billy Joel’s music and marvel at the fact he still routinely sells out Madison Square Garden crooning his pop rock songs from 1970s and 80s – talk about an income annuity! So what is the financial planning connection you wonder?  Well, at age 66, Mr. Joel has reached full retirement age (“FRA”) for Social Security benefit purposes.  While no longer subject to a reduction in his benefits due to earned income, my hunch is that he doesn’t need Social Security benefits to...
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Jul
22
Interest Rates and Pancakes
My daughter Abby recently discovered that she is gluten intolerant and has been adjusting her diet accordingly.  She inherited her passion for pancakes from her father, however, and was more than a little anxious to discern if gluten free pancakes were edible.  Well the good news, unlike some gluten-free flour products, she has discovered that her mother's gluten-free pancakes are in fact delicious, much to her relief. To draw a weak analogy, like gluten sensitivity, interest rates are now causing some investor discomfort.  Longer-term US Treasury debt posted a substantial negative total return in the second quarter of 2015 as investors braced for the announcement of a short term interest rate increase(s) by the Federal Reserve. As...
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Jul
10
Grecian Formula - For Disaster
Recent news headlines have been consumed with the worsening relations between Greece and the European Union (EU). The explanation for the Greek crisis playing out is rooted in simple economics, but first some history.  The founding of the European Union, a political-economic confederation of twenty-eight European member countries in 1993 led to the introduction of the Euro common currency in 2002.  Seventeen of the twenty-eight EU countries, including Greece, agreed to surrender their domestic currency in exchange for the Euro. The trouble is the currency union was flawed from the get-go.   Without common political and banking institutions or cohesive fiscal policies, economic/financial imbalances among the various EU countries quickly...
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Jul
07
A Worthy Investment