Time is measured for many of us from events in our lives that have meaning and strong remembrances.  To each and every one of us, those special times may vary depending upon our individual experiences.  However, there are those events that resound with the majority because of the history shaking significance that touches all of our lives at the same time.  Such an event was September 11th, 2001. It seems almost impossible that event was nearly twenty years ago. Yet, we still measure many of our life experiences from that date forward.

The recent pandemic underscores the truth of that last statement. By necessity, we have reshaped our lives and not necessarily always to our liking.  For a majority of us, our homes became our offices. The home front was our boardroom and workshop for assembling the tools necessary to achieve our business and personal goals. 
 
Four different Presidents have led our country since 9/11– George W. Bush;  Barack Obama; Donald Trump and Joe Biden.  The significance of each of their accomplishments underscores the impact they have had on our collective lives.
 
We have seen the Stock Market soar beyond our imagination, and bottom-out almost as quickly to our amazement. We have witnessed men and women’s achievements in space even reaching Mars, and then a lack of ability to sustain harmony here on earth. The closing of our favorite haunts and the impact of the dismissal of class study on our children is still to be assessed.  Yes, there have been many “ups and downs” in the past twenty years.  The question is then, “What do we have to look forward to?”
 
When I was a young man, there was a  motion picture series entitled “THE MARCH OF TIME” which centered on the days’ events that shaped the future of mankind.  I  looked forward to each one of those features on the movie screen because, with few exceptions, they pointed to a brighter more fulfilling lifetime ahead.  Maybe I’m an incurable optimist, but I see and feel that we have much to learn from the past history of our country.  We are a people who desire to create and to succeed. 
 
Thus, it is easy to realize that we have just begun to envision a brighter, more enlightened time ahead.  The “long day’s nights” that we have experienced are coming to an end.  We are starting to breathe the fresh air of personal freedoms again – planning vacations and family gatherings that will have new and many happy, emotional returns. We are opening the doors to our treasured past and are finding new avenues of expression that will pay personal dividends in a quest for happiness and security.   Hopefully we have learned from past mistakes and will take our combined experiences to heart and heal wounds that have divided us.
 
There is still much to be achieved and plenty of time if we will be patient and stay strong to accomplish all we desire.  We are a people who are noteworthy in our strengths to remember our pasts, but with the foresight to not overlook our future.  It is that reflection that helps us to remember that the “past is merely a prologue.”  Enjoy today and keep your eyes wide open to what lies ahead.  Let’s make the next twenty years the best remembered of them all!
 
TIME MARCHES ON!

​Chicken farmers say not to put all of your eggs in one basket. Investment analysts renamed this diversification. It amounts to the same thing – spreading out your assets in different baskets or investments is supposed to reduce the risk of loss. However, putting your eggs in different baskets doesn’t truly reduce the risk if one truck is carrying all the baskets and it gets in a wreck.
 
The financial pros say you should blend together stocks of different industries, non-stock assets and bonds to reduce the risk of loss. However, there’s a problem. Especially in bad times, stock returns tend to move together, or correlate. Consider the Crash of 2008. Even if you diversified between stocks of large companies, small companies and foreign companies you lost big. Going into non-stock “alternative” investments didn’t help either. Whether you owned real estate, oil or gold, you had less in December 2008 than you had in June.

Okay Baby Boomers, I am in your camp and I am sorry to announce that there are more yesterdays than tomorrows in our lives.  Where did all the time go?  Even though life is uncertain and every day is a gift, we felt okay saying… ”I will get to that tomorrow.”  But, regarding our financial lives, we need to get on it today.  It is time for all of us to take a financial inventory and review our game plan.  It’s time to sit down with your spouse, family or any people that could be affected by your passing.  Look at life insurance  policies, wills, trusts, investment accounts, annuities and bank accounts.  It’s also a great time to review your final instructions.

It’s never too late to fine tune your income accounts and plans.  Do you have the appropriate amount of income to stay in the world that you have planned and become accustomed to?  What about final expense money and policies?  Is it time to consider additional life insurance?  Do you know that life insurance is easier to buy, and you probably won’t need a medical exam?  Do you need to take a look at your “Safe Money Portfolio?”  What about sitting down with your financial professional to do a review?  Don’t you have a visit with your physician every year?  Visit the dentist?  What about keeping your car serviced?  It’s time to take action. If you don’t have a financial professional, let us know and we will connect you with a licensed insurance agent that is a member of The Safe Money Places Agent Network.  Remember, don’t put off till tomorrow what you can do today.  Tomorrow might not come. Stay safe and do it.

While flying the other day, I looked up at the fasten seatbelt sign as the pilot said to stay in our seats as we may be hitting some turbulent air.  So, of course I complied.  But it got me thinking about a message we might want to be giving our clients and prospects... “Fasten seat belts while invested, as we may be hitting some market turbulence and volatility over the next several months.”  But, instead of advising them that an oxygen mask will drop or that you can use the cushion as a flotation device, we can tell them the following, “During this turbulence, all monies in a fixed index annuity will be protected from loss of principal and previous gains.”

Now, can I continue to talk about airline experiences?  A few months ago, we were flying back to Hilton Head from Indianapolis and ran into some rough weather.  The pilot was a pro, but we circled quite a bit.  He then advised the passengers that we were going to make a stop in Savannah to get some fuel as he was afraid that we might run out of gas.  So, we landed, gassed up and were on our way without a hiccup.  Well, let's remind the client that they won't run out of gas with a fixed index annuity.  The gas we’re are talking about is the lifetime income.  Doesn't matter how long you live or the weather situation, your income is guaranteed until the day you die.

So, for the passengers with the fixed index annuity, sit back, enjoy the flight as we will be landing shortly.  Like to know more about fixed indexed annuities? Ask your licensed member of the Same Money Places Agent Network

There are so many items in our lives that require regular maintenance.  Let’s think about this for a second.  Don’t we take care  of our cars?  Yes, change the oil, make sure tires are rotated and make sure that everything is functioning well before a trip?  What about your heating and cooling systems?  Of course we stay on top of this.  We don’t want to lose heat when the weather turns cold nor lose the A/C when the sun starts to bake us in the summer.  We go to the dentist on a regular basis, get regular check ups from our physicians and also make sure that our eyes are working well.  I could go on and on.  But, are you performing regular maintenance on your retirement income accounts?  Sadly, I find that many Americans don’t.  And, that can cause some real problems in American’s lifestyles.  Let’s examine…

If you are retired, or soon to be retired, you have hopefully divided your income needs into a couple of categories.  The first being the essential income that you will need to stay in the desired income life that you have planned on.  You take those expenses and subtract social security income, pension income if you are lucky enough to have one, and other guaranteed forms of income.  That is when you find the shortfall.  Then, there is the discretionary income that you desire.  You know, vacations, trips with the kids or grandkids, educational assistance for your loved ones, etc.  And, many Americans find this to be a little nerve racking.  Maybe I can suggest something to make your retirement a little more safe and serene.

I suggest an annuity that can provide a guaranteed flow of income for as long as you live might just allow you to spend more, relieve stress and protect this nest egg from losses.  Isn’t it great to know that there is an additional check sent to you each month.  It is a great way to “plug the gap” and provide the essential income that you need.  Now, there are various forms of annuities to choose from.  And, I feel pretty confident that you will find one to help you achieve the retirement dreams that you have.  Contact a licensed insurance agent that is a  member of “The Safe Money Places Agent Network” and have that maintenance review that I am talking about.  Great for peace of mind. What do you have to lose?  I feel pretty confident that you will start gaining better sleep at night.  I love annuities and know that you will to. Stay Safe.

You have a legacy plan.  If you say, “I haven’t set up a legacy plan,” I say, yes you have. Without proper planning, you allow the government, nursing home facilities or others to do it for you.  Of course, you need a good will and possibly thoughtful trusts to get you headed in the right direction.  You also need health directives to make sure your wishes are followed through.  And, you need an executor to make sure things are handled properly. As an insurance professional, I can help take care of some basic planning that can help you avoid the pitfalls of not having a plan in place. I can take care of legacy planning, income needs and planning for long-term care needs. Please allow me to explain…

Today I am going to focus on life insurance with accelerated benefits for long term care needs, and products that have accelerated benefits.  In short, accelerated benefits on life insurance products mean that the death benefit would be paid out to you while living if you can’t perform two of the six activities of daily living.  
 
Let’s look at a real-life scenario. You may have some dollars set aside that won’t be needed for retirement income.  You purchase a life insurance policy (this could be a single premium life policy or a periodic premium plan) with the accelerated benefits as described in the paragraph above.  
 
Let’s assume that a health issue develops, and you can’t perform two of the six activities of daily living.   Let’s say that you opted for a single premium life policy with $100,000 of premium. 
 
That premium would generate for a 65-year-old female anywhere between $180,000 and $300,000 of tax-free death benefit (the more underwriting… the greater the death benefit).  So, let’s assume this policy has a $200,000 death benefit.
 
If a health issue occurs and you cannot perform two of the six activities of daily living – then, the entire $200,000 death benefit is paid out to you in tax-free payments. These payments are generally tax-free because they are an acceleration of the death benefit. These payments are paid directly to you, and you are able to use them to cover your health care costs. 
 
But what happens if I don’t need those accelerated benefits and I pass away?  The proceeds are paid tax-free to a named beneficiary.   What happens if you have an emergency and need the money?  These products accumulate cash value and you have access to the cash value when and if you need it.  
 
Some life insurance policies offer a return of premium feature.  This means if you decide to quit the policy, the insurance company will give you the premium you paid back. 
 
Your financial professional can provide you with information on this type of product. What do you have to lose?  This is a tax friendly approach to an important part of your retirement plan. Let me know if you would like more information about this type of legacy planning.

In more than eight decades of my life, I have experienced many down turns as well as positives enough to fill many essays and dreams.  If there is anything I have learned over time, nothing lasts forever.  In a flick of an eye, situations – good as well as bad – will change, and normalcy will reclaim our lives, and we will survive and be better for it.

Trying to compare our recent year of the covid 19 virus with past experiences can be difficult.  The year 2020 has few comparisons unless you go back to 1917 and the Spanish Virus.  Obviously, there are very few people who remember those dreadful days.  In the over one hundred years since then, there have been many times when we have faced difficult disease outbreaks, and even wars, yet we have survived and found means to overcome adversity.  The American Spirit  prevails in the darkest of days.  Our faith and country go hand in hand meeting the challenges and brushing aside negatives that try to lead astray.

The only comparison that I feel is realistic in my family goes back to the early and darkest days of early World War II.  Families were split apart with fathers, brothers and other relatives being shipped far away; the print mediums and radio broadcasts highlighted negative news from various fronts, rationing of essentials such as gasoline and rubber prevented people  traveling to visit family and friends.  Mom found her pantry shelves void of the sugar and spices -  many of the essentials necessary to bake the many holiday surprises we were fond of enjoying. 

I remember how my sister and I felt as young children.  Would there ever be another other Christmas like the ones we remembered from our limited past?  We were separated from family and friends, even though our parents were tying hard to convince us that Santa Claus would still find us even hundreds of miles from our normal home.  It compared to this year in many ways, and yet, we felt blessed that we were still free and able to communicate our lives and loves to those who meant so much to us.

Today, we are more fortunate to have many means of communicating instantly to those who are separated from us. With modern conveniences such as computers  and cell phones,  even though we may be apart, we  come together instantly from any part of the country or world.  In many cases photos are transmitted just as quickly as voice messages.  We are being held together even though we are apart.
Yes, today is challenging, yet we know and believe we will overcome all that we are facing.  It is in our minds and hearts to be strong and stay the course to a brighter more fulfilling future.

                                      Another day…we’re moving on… 
                     To address the challenges…others have come and gone.
                                   We’ve adjusted to wearing a mask,
                       Though it is made more difficult to complete a task.
                                A burger and fries from a local drive thru,
                            Have replaced group gatherings we once knew.
                                Family and friends stay a distance apart,
                            When a nice hug and kiss would heal a heart.
                                 Not having togetherness can be lonely,
                                 But let’s not be caught saying…”if only.”
                        Let’s reach out to those we know…many or few,
                            With a call or note or even an e-mail will do.
                                         Move on in positive ways,
                                  To make these the best of our days.

            A very Merry Christmas and a much Happier New Year 2021

Happy Holidays.  If you are like many Americans, you’re wondering when to take retirement income… and how much.  Well, for those of you old enough to remember layaway, this might just work for you. The “layaway” concept is also referred to as “laddering” by many.  In other words, let some of the money continue to grow for a while, tap another part of the nest egg for a period of time and then release the balance in a retirement income  flow. Let me give you a couple of examples.

Now, remember, each situation is different and you will want to confer with your financial professional. Here we go…

Let’s say we have a male ready to retire at age 66.  He can take Social Security now, as he needs the money, but wants to maximize the value of his Social Security retirement income. Let’s also say that his Social Security retirement income is $2500 per month at age 66.  He could leave that Social Security alone until he reaches age 70.  That $2500 is guaranteed to grow at 8% per year with no current taxation. Very tough to beat today. But, remember, he needs $2500 per month now. What to do?

He could get a 4 or 5 year single premium immediate annuity for the period until he is 70 years old. Then, when that money is finished, he then takes Social Security which is much more than the $2500 at age 66.  But, he has other moneys and will need more at age 75.  So, he could purchase a fixed index annuity with a lifetime income rider to get the additional income he desires and take retirement income off of this account at age 75.  Sound confusing?  Let me help.

With this concept, your financial professional will only need to ask you two questions.

“How much do you need?” And, “when do you need it?”

He can give you the exact amount of money you need to put in “layaway” to achieve your retirement income needs. So, let’s empty that worry bucket. Holidays are approaching, and this is one worry we can eliminate.

With bank savings accounts earning pennies in interest, and even long-term certificate of deposit rates averaging less than one percent, it can cause a squeeze in the household finances. One result is some people go on yield safaris, looking for bigger interest game. While there is nothing wrong with trying for higher returns, the concern is that the potential for loss is sometimes overlooked.
 
A decade and a half ago auction rate securities and mortgage bond tranches were sold as low risk, liquid alternatives during a period when bank rates were falling. However, auction rate securities largely became illiquid and many of the “AAA” bonds were reclassified as junk or in default in 2008.
 
This time around some savers were buying packages of small business debt – but the impact of SARS-CoV-2 is causing small businesses to fail. Others are buying dividend paying stocks – often a sound move, but even companies like Ford creased their dividend in 2020. The more adventurous try covered call option writing, where you collect a fee for agreeing to sell a stock you own at a given price. It works well when the stock price is steady; however, all the option fees put together cannot overcome a big drop – like Exxon Mobil share price falling roughly in half in 2020.
 
If you’re a saver looking for a place that pays higher interest than the bank, but still protects your principal and the interest you’ve earned from market loss, the alternative is pretty much coming down to fixed annuities. Although a fixed annuity is not FDIC insured, fixed annuity carriers have an excellent record of protection in both good and bad financial times. There are two main types.
 
 A fixed rate annuity pays a locked-in interest rate for a specified number of years – anywhere from one up to ten. A fixed index annuity pays interest based on the performance of an independent index, usually linked to the stock market. Which is better? It depends.
 
With a fixed rate annuity you know what you’re getting. With a fixed index annuity if the index goes down you won’t earn any interest for that year (but you won’t lose what you have). However, the fixed index annuity often offers the potential for considerably more interest, so if the good years offset the bad they could pay much more interest. It ultimately comes down to whether you’re okay with seeing a zero in a given year.
 
Fixed annuities have penalties for early withdrawal called surrender penalties. For fixed rate annuities with multiple year interest guarantees the penalty period usually matches the guarantee period. Fixed index annuity penalty periods are usually for five to ten years. The early penalties are much higher than those imposed on certificates of deposit – so you shouldn’t buy the annuity if you think you’ll need to cash it in early – but you need to look at the entire picture. If your choice is between a CD paying 0.75% and a fixed rate annuity paying 2.5% that has a 6% penalty, you are money ahead with the annuity after four years, even after cashing it in.    
 
This is a very tough time for savers, and it doesn’t look like yields will be going up anytime soon. Even so, this isn’t the time to quit the bank and start hunting exotic yield beasts that could come back to bite you. It is a good time to consider moving some of that money to the protected sanctuary of fixed annuities.
 
For educational purposes only. Does not provide investment, tax or legal advice. Information believed accurate, but is not warranted. Not a solicitation to buy or sell any security. Past performance is not an indication of future results. Both investments and fixed annuities involve certain risks; a consumer should consult with their advisor. Fixed annuities are not bank instruments and are not insured by FDIC.

Planning: Year-End Financial Planning Deadlines 

As 2020 comes to an end, there may be a few items that need to be completed before the clock strikes midnight on December 31st. 

• 529 Plan contributions - must be received by the plan by year end in order to claim any available state income tax credit.  In Indiana, for example, the maximum annual credit is received once you have contributed $5,000 into Indiana 529 plans (equals a $1,000 Indiana income tax credit).  
• 529 Plan distributions - must be taken in the same calendar year that the qualified educational expense is paid. If you paid an education expense in 2020, you must take the 529 Plan reimbursement distribution by year end. If you are going to pay the expense in January 2021, then you need to wait and request the distribution in 2021. 
• Health Savings Account and 401k Plan contributions – review your funding for the year to see if additional last paycheck contribution options exist or if you need to make adjustments for maximizing 2021 contributions.  
• Family gifting – the annual gift tax exclusion amount is $15,000 for 2020. This is the amount you can give to each recipient without paying gift tax or using part of your lifetime exclusion amount. 
• Charitable contributions – if under age 70 ½, consider transferring shares of low basis investments. If you are over age 70 ½, then you can make a Qualified Charitable Distribution from your IRA of up to $100,000 per year.   
• Charitable contributions continued - for 2020, if you claim the standard deduction, you can also take a $300 charitable contribution deduction (per tax return) for cash contributions to public charities. This above the line charitable deduction will reduce your taxable income by up to $300. You will need to keep your written receipt as a backup for this deduction. 
• IRA and Retirement Account distributions – the CARES act eliminated required minimum distributions (RMDs) for 2020. This year no distributions are mandatory by year end from IRAs, Inherited IRAs and company retirement plans.   
• Roth conversions – if 2020 is a low-income tax year (maybe due to lower IRA distributions or changes in come levels), you may wish to lock in a low tax bracket by converting part of your IRA to a Roth IRA.  

Thank you for allowing the Windsor Wealth Management Team to continue to earn your trust and confidence in the services offered to you. We appreciate your loyalty and always welcome feedback from you. We wish everyone a happy and healthy holiday season! 

Dream boldly. Plan wisely.