We are happy to do introduce two new technology options which are designed to reduce paper, postage and time. Both of these upgrades are completely optional for you, but if you want to take advantage of them, let’s do it!

DocuSign

This functionality allows online form completion and signatures for nearly all Ameritrade documents. One downside of this option is that you will get an email link from Ameritrade – and that email link looks a lot like those “phishing email links” we have talked about before. We will let you know if we are sending you a document using DocuSign so that you can be on the lookout. After you electronically complete and “sign” the form, everything is automatically transmitted to Ameritrade and we get an email alert. Another downside is that mandatory attachments are messy or impossible. We are still working on making this piece easier.

What this means for you is that there are now three ways to complete and sign all the required paperwork:

• DocuSign (which we will not use unless you have agreed) – fastest and lowest carbon footprint!
• Print at LFS, mail to you and have you mail to Ameritrade or back to LFS – slowest and highest carbon footprint!
• Email form to you, have you print and complete/sign and then scan back to us. (Not all Ameritrade forms can be handled this way)

We are happy to use whichever method is easiest for you at the time.

AdvisorClient screen sharing

This functionality, which is brand new for advisors and clients, allows you to share most of your AdvisorClient screens with us (or Ameritrade) so that we can more easily answer questions and troubleshoot any issues.

This feature is simple to use:

• Log into NEW AdvisorClient
• Select “screen share” from bottom right of any page (green button)
• Give us or Ameritrade the “code for my agent” which is found at the bottom center of the page.

As always, let us know if you have any questions or concerns.

It is with great pleasure that we announce Tim Kriegel as the newest member of our Linder Financial Services team! Tim has recently received his Registered Investment Advisor certification and will be soon getting to know you and our business.

Some of you may know Tim. He has been a long time LFS client and a former neighbor of Bernie and Toby in Hendersonville. He recently retired from his position at Selee Corporation where he held a number of executive financial positions, including Chief Financial Officer. He holds a B.S. in Business Administration from Clarion State University and is a Certified Public Accountant. He currently resides in Hendersonville.

We are so excited that Tim has agreed to join us. He will have two immediate priorities as he comes aboard:

• Tim will provide additional LFS financial advisory capacity in western NC and cement our long term commitment to that area which we all love so much. We will now be able to take on new clients in western NC and provide additional operational support to those of you that reside there now. But no worries, Bernie still thinks he’s in charge and is available for coffee and advice as always. You will continue to interact with him, and with us from Atlanta, just as you do now. But feel free to refer your friends and neighbors to us now – we can now absolutely support them and we are always truly grateful for your kind words to your friends and family.
• The new SECURE Act (see Bernie’s Blog) has reinforced the importance of smart generational wealth transfer so Tim will be leading our efforts to develop the “what” and “how “ to do this very important work with and for you. This work is not just paperwork, although there is always plenty of that. We are looking forward to building robust plans to get to know your heirs and build their trust in us, while we give you one less thing to worry about!

We are looking forward to introducing you to Tim over the next several months. Those of you in western NC will get to meet him in person sooner, but expect that all of you will hear from him over time. Please join us in welcoming Tim to Linder Financial Services.

Tim’s contact info:

Phone: 828-606-9078

Email: Tim.Kriegel@linderfinancial.com

This blog will focus on the major 2020 changes to distributions from retirement accounts. The last blog entry focused on the 2020 changes to contributions to retirement accounts so feel free to look back to refresh your memory.

You may have heard of the new SECURE Act which was signed into law on December 20, 2019. We know you will feel more secure to know that “SECURE” is an acronym for “Setting Every Community Up for Retirement Enhancement Act”. The government has been busy with other priorities since December 20, so many of your usual information sources, including us, have not been fully updated yet. In truth, the government officials have not all yet agreed on some of the technicalities so just call us with questions and we will work through the implications individually with you as needed.

Required Minimum Distributions (RMDs)

• Participants will now be able to delay taking RMDs from their traditional IRAs until they reach age 72 (up from age 70 ½). This change only applies to those who turn 70 ½ in 2020 or later. If this applies to you, we have talked with you about it. If you are already taking RMDs, you must continue even if you are not yet 72. This is a good thing for most of us!

Inherited Retirement Accounts

• Beneficiary IRAs (non-spousal) must now be completely distributed within 10 years (instead of over the lifetime of the beneficiary). The rules for distribution to a spouse have not changed – the distributions are treated as if the IRA belonged to the spouse all along. Note that this means that all the income taxes must now be paid within 10 years. This is a massive, and largely unfavorable, change for most of us.
• Roth (non-spousal) Beneficiary IRAs must now also be distributed within 10 years, but there is of course no income tax due.
• This change might make a Roth IRA conversion more attractive as an estate planning strategy. We will discuss with you if applicable.

Adoption/Birth Expenses

• Penalty-free withdrawals from traditional retirement plans are now allowed for birth or adoption expenses, up to certain limits. Taxes must be paid on the withdrawals.

Happy New Year everyone! This blog will focus on 2020 changes in funding to retirement accounts and the next one will cover the 2020 changes to distributions from retirement accounts. Spoiler alert: the distribution changes are potentially complicated and we will plan to cover those with you individually as well.

401K/403B/TSP et al:

• Contribution limit increased to $19,500 (up $500)
• Catch-up contribution limit (for those 50+) increased to $6,500 for a total of $26,000 (up from $25,000)

Roth/Traditional IRA:

• Contribution limit is $6,000 (no change from 2019)
• Catch-up contribution limit (for those 50+) is $1,000 for a total of $7,000 (no change from 2019)
• Income limit eligibility for Roth contribution:
  • Phase-out begins for individuals begins at $124,000 and stops at $139,000 (up $2,000 from 2019)
  • Phase-out begins for couples begins at $196,000 and stops at $206,000 (up $3,000 from 2019)

SEP IRA:

• Contribution limit is 25% of gross salary or $57,000, whichever is less (up $1,000 from 2019)

Let us know if you need help adjusting your contributions or if you have questions about your eligibility.

Hello, it’s Bradley, Marci’s eldest, here with another of my obituary blog posts. You may have missed it in the news, (there were a few other pressing headlines in December) but on December 8th, 2019, former Chairman of the Federal Reserve, Paul Volcker, passed away at the age of 92. I thought that given the recent focus on the Federal Reserve and interest rates, it may be worth writing a few words about him.

Paul Volcker was born in 1927 in NJ, and so grew up during the Great Depression and World War II. In his senior thesis at Princeton, Paul criticized the failure of the Federal Reserve to restrain inflation following WWII (something that clearly influenced his later thinking). After several years working for the Federal Reserve Bank of New York and Chase Bank as an economist, he joined the Nixon administration as Under-Secretary for monetary affairs and was later appointed as president of the Federal Reserve Bank of NY, and finally to the Federal Reserve Chairmanship by President Carter in 1979.

When Paul Volcker took over the Federal Reserve, the United States was facing persistently high inflation, the increase in prices (or decrease in the value of the dollar) over time. These inflation levels were due in part to higher prices of oil due to the Arab oil embargo and Iranian Revolution.

High levels of inflation can be extremely detrimental to the economy, as they discourage saving (since the value of saved dollars decreases over time). In economics, inflation can be seen as too much money chasing too few goods, resulting in higher prices.

The usual antidote to inflation is a decreased money supply. And contracting the money supply is exactly what Volcker’s Fed did. Volcker increased the Federal Funds rate (the rate that banks lend money to each other; it is generally the lowest interest rate in the economy) to 20%! By comparison, the “tightening” of interest rates in today’s Fed reached only 2.5%. These high interest rates decreased the ability of individuals and corporations to borrow money, resulting in a decrease in the money supply and corresponding decline in inflation. This strategy also contributed to a recession (and unemployment rates of 10%), but by 1983 inflation had fallen to the Fed’s target of 3%.

Following Volcker’s term as Fed Chair, inflation has never risen to the same heights as in the 1970’s. This is due (in part) to the fact that Volcker’s Fed had convinced markets that if inflation were to rise again, the Federal Reserve would raise interest rates to squash it, and as in so many things in finance, expectations became reality. This collapse of inflation led to the incredible rates of economic growth in the 90’s, and later in the 2010’s. Later in his life, Volcker became an outspoken critic of banking consolidation, including support for the “Volcker Rule” requiring the separation of commercial banks from proprietary trading (a subject beyond the scope of this already too long blog post). We will all remember Paul Volcker as the inflation warrior he was.