Latest News from The Musuneggi Financial Group

Post-Brexit Bear Market? Oh my!

By Mary Grace Musuneggi

bear marketIn the wake of the Brexit decision, I can’t help but think back to June 2008. I remember fielding calls from clients who were pretty sure they would spend their retirement years living under the Smithfield Street Bridge. As 2008 and early 2009 brought financial markets to their knees, we felt their pain. In lighthearted moments we would laughingly say maybe we needed to change the name on the door of the office from The Musuneggi Financial Group to The Musuneggi Dog Walking Gang. But the fact is it was more important for us to hold on to the belief that “this too shall pass”–and it did.

In 2014 we began to advise clients that we were at the historic highs of the stock market…and we had bond rates that were at historic lows. Double whammy! And although there is no crystal ball, and past history cannot predict future history, we do believe that history can lend some perspective.

At that time, Brenden Gebben, Portfolio Manager for Absolute Capital, shared an article in which he referred to the Ned Davis Research that says during Bull Markets, on average, the stock market has historically sustained upward trends for 331 market days before a 10% correction occurs and upward for 1105 market days before 20% correction occurs. So from this view we were certainly due for a correction.

And here it is. So what are some things we need to do? What are some things we need to remember?

1. Avoid trading too frequently.

2. Stop. Don’t panic. Trust your strategies. Trust your money managers’ strategies; after all, that’s what you’re paying for.

3. Don’t get out of the market at the worst times.

4. Be sure you are diversified. There are other market segments beyond just domestic stocks and government bonds. Be sure you understand them all.

5. Re-balance sometimes. Often. Frequently. Or whenever it is appropriate for your risk tolerance and for your objectives.

6. Don’t ignore tax ramifications. Return on investment is not the same as after-tax return on investment.

7. Know that we cannot control economies, performance over the years, or returns, but we can control strategies and asset allocation.

8. And remember, in 1921 the Dow Jones was at 60. Obviously it has gone up. But to get there it has gone up and down and up and down and up and down along the way. Time can certainly be more important than timing.

No matter what the markets are doing, your investment decisions need to be those that are right for you. At the right time. In the right allocation. To review your current strategy give us a call.

And if you’re concerned about a Bear market post-Brexit, we’ve just added a Bear Market Webinar to next week’s calendar. For more details and to sign up, click here or contact Chrissy at chrissyg@mfgplanners.com.

Who Has a Legacy?

By Mary Grace Musuneggi

Just about the time a President’s term is coming to an end, there is talk about what he wants his legacy to be. The same discussion often happens when a leader leaves the business world or a non-profit organization.

But a “legacy” is not just for the great leaders of our world. It is for all of us who are great in our own worlds. We all have a legacy. What will we leave behind when we leave this earth? How will people think of us? What have we done to add to the world or to make it a better place? What have we taught our children? What have we given to those we love?

Here is an idea I heard of years ago: pretend you are attending your own funeral and listening to what people will say about you. What do you think you would hear? What did you accomplish that you want everyone to know about? And what did you do that no one will know about or speak about…but you are proud to have accomplished?

One way many of us contribute to our world is through volunteering and charitable
giving. When I am asked by people who are retiring, “What will I do every day if I am not working?” my first suggestion is to consider volunteering. The world is in desperate need of volunteers, and there are organizations that need you–from medical research, to educational programs, to animal rescue, to the environment, to religious causes, you are bound to find something that fits your passion. This can be your legacy…or at least a part of it.

If you regularly donate to charity or other worthy cause, put money in your church collection, tithe, or spend money at a fundraiser, you are one of those special people who helps to contribute to the betterment of our world, even if just a small part of it. And this, too, is part of your legacy.

Believing in the premise that you will “reap what you sow” and “get what you give,” you probably find that your reward for charity comes in feeling good about what you are doing, or by an increase of abundance in your life, or maybe even in the value of the tax deduction you can claim. In any case, those organizations who share in your generosity are very appreciative. They love you!

Finding the time to build your legacy is one thing. But where will you find the money to build your legacy, if that is what is required?

Tithing–giving away 10% of your income–is a good start and one of the central themes in abundant living.

Sharing an inheritance is another. If you have been fortunate enough to receive assets from a family member or friend, you may want to leave part of that as your legacy.

Or, if you routinely give from your income or assets to a charity, considering giving IRA money instead of non-IRA assets. This is especially great if you have to take a Required Minimum Distribution every year once you are over 70 ½. You can have IRA assets sent to a charity, which is a tax-free strategy for you and the charity. It’s a win-win.

A sustainable legacy that will continue long after you have passed on is a Foundation. Most people think these are only for the rich and famous, but you can start a foundation for as little as $10,000. That money can be added to the foundation today, or it can be done once you pass away. You can name the foundation whatever you want (I named mine after my mom) and you can dictate who will receive the funds: the elderly, or dogs, or children, or the earth…it is entirely up to you.

Whatever the case, we only live once. But if we do it right, once is enough.

The Musuneggi Financial Group is proud to partner with the Pittsburgh Foundation to assist clients and friends in developing a legacy. For more information, please contact our offices at 412-341-2888 x 0

Mary Grace Musuneggi Receives Humanitarian Award

NAIFA PA conf 2On May 4, Mary Grace Musuneggi received the 2016 Humanitarian Award from the National Association of Insurance and Financial Advisors – Pennsylvania.

NAIFA-PA presents their annual Humanitarian Award to recognize an individual’s efforts to give back to the community and positively impact lives. Mary Grace was selected because of her longtime commitment to helping women be independent and successful, including her work with Single Steps Strategies, Dress for Success Pittsburgh, and Toys for Tots.

The award includes an honorarium for charity, and Mary Grace is pleased to donate hers to Dress for Success Pittsburgh: “To be recognized by peers is always an honor, but I’m especially excited to be able to put the spotlight on Dress for Success Pittsburgh and the amazing work they do every day for women in western PA. Any time we can pay it forward in their direction, I know something positive is about to happen.”

Congrats, Grad! Now About Those Loans…

Graduation group

 

By Mary Grace Musuneggi

It’s the time of year when some students are ready to graduate from college, while other students are preparing to graduate from high school and begin their college experience. It is the time of year to look back at the accumulation of college debt…or forward to the loans yet to come. In either case the cost of education can be the largest output of cash for parents (and their children) aside from the purchase of their home.

So for the bad news. The graduating college students who will be venturing out into the world with large college debt may struggle to be gainfully employed in a high-paying job and pay their loans. They will need to put on hold, or should put on hold, purchasing a home or car and starting a family of their own. If not, their debt amasses with mortgages, car loans, and saving to educate their own children. Somewhere in there is also the need to save for their own retirement. And if it is the parents who put their retirement planning on hold to pay for college, catching up may be hard or even impossible.

And then there is the issue of being a co-signer for the college loans. If the student does not pay, the parent has to pay. If the student becomes disabled, the parent has to pay. If the student dies, the parent will still have to pay. And with some college loans, if the co-signer dies the loan may be due in full immediately, or the lender could go after the co-signer’s estate.

Now for the good news! Saving early and often can help. Preparing a thorough financial plan can address many of these needs. Taking advantage of various educational options and financing arrangements can go a long way to addressing the costs. Life insurance on the child could handle the co-signer issue that may arise. Understanding the loan agreements before signing is also important. Considering refinancing options with existing loans may make the payments lower. Researching federal college payment plans to see if loan payments can be adjusted based on the amount of income earned can allow money for other financial needs. Checking with your financial institution to release the co-signed as soon as possible is a definite must.

Planning. Planning. Planning. It all comes down to planning. Start planning when the kids are born. Continue planning as they grow. Don’t put retirement planning on hold. Plan to read and understand everything you sign. Discuss career planning early with the student. Plan to have a plan. Plan to ask for help. We are here when you need us, but remember that we are here sooner, too: consider the benefits of letting us help you put a plan in place before you need us.

Don’t Forget This IRA Tip!

Remember that if you have not done your IRA or Roth contribution for 2015, you still have until April 18th to do so.

Remind your accountant to determine what tax savings you may get if you make a traditional IRA contribution for yourself or a spousal for a spouse who is not currently working outside the home.

The tax savings can be substantial, and we would rather you keep that extra money in your pocket than “donate” it to Uncle Sam. We suspect you would prefer that, too.

Please contact our offices if we can help: 412-341-2888 x0.

 

This information should not be considered as tax/legal advice. You should consult your tax/legal advisor regarding your own tax/legal situation. Securities & Investment Advisory Services Offered Through H. Beck, Inc. Member FINRA, SIPC.
H Beck, Inc. and The Musuneggi Financial Group, LLC, are not affiliated.

Important Tax Info!

Happy New Year! As we come to the end of one year and the beginning of another, we are reminded that tax time is just around the corner. We are hopeful that the following information will be helpful in your preparation. We highly recommend that you keep this with your tax information and share it with your accountant. If you are doing your taxes on your own or with a person who is not a professional accountant, we will do our best to help, but we are limited by liability from giving tax advice. If you are not proficient in doing your taxes with software or online, we highly recommend that you work with a professional.

1099’s – In the past, we normally expected that 1099’s should arrive to you by mid-February. However, in the last few years, this has not been the case. Our hope is that you receive all of these by the end of February, but we have no control over this, nor can we control that some companies may issue 1099’s and then send corrected 1099’s weeks later. If you have taken withdrawals from your IRA’s or similar tax-deferred accounts, you will receive 1099R’s. If no withdrawals have been made, you will not receive 1099’s on these accounts. Be sure that you are in possession of all of your 1099’s before you meet with your accountant. Many issues that arise from your taxes are tax issues and not investment issues. It is also helpful to have your accountant compare your 1099’s to those from previous years to be sure nothing is missing. This is particularly important if you are working with someone new. Use your last year’s return as a guideline. Expect your accountant to do the same. If there is a missing 1099, they should ask where it is or if the account has been replaced. We have no way to know what you have provided to your accountant, but this way they will know what you should provide.

Cost Basis – If you have sold securities during the year, you will see these reflected on a 1099B. You will need to provide cost basis information to your accountant for these trades. This means that you will need to know what you paid for the shares and the dollar amounts of the capital gains and reinvested dividends, if there are any. Without this information, you could be paying too much in taxes on these trades. We also know that many of you will need financial statements for college and other government programs at this time of year. We will be happy to help you with advance notice.

Please do not call us from your accountant’s office assuming that we can provide this information while you are there. It is important that you do not wait until the last minute to file your return. If you need us to provide you with account information, it may take up to 10 business days.

Data Collection – Please see that your accountant provides you with a data collection list or questionnaire to be sure you have provided everything, as well as to be sure that you have not missed any possible deductions. Many mistakes on tax returns are ones that cause you to pay higher taxes.

Our Services – We can only provide you with information for accounts that are currently under our management. A fee will be charged for us to do research on accounts that we do not manage or control. As we are not accountants, we cannot answer specific accounting questions for your tax return. We do have accountants on our team that we would be more than happy to introduce to you. If you would like us to review your return after it is completed, or to work along with your accountants, we would be glad to do this on a fee basis.

Electronic Filing – If your return is filed electronically, we highly recommend that you review it before it is transmitted. We have had clients in past years who received their returns, wanted to make IRA contributions to reduce their taxes, or had additional information for their returns, but discovered that the tax preparer had already transmitted their return electronically before they received their copy to review. To avoid this, simply ask the tax preparer to wait for you to review the return before it is filed.

Retirement Plans, IRA’s and possible other deductions – Before you submit your return, be sure that you have taken advantage of all IRA tax laws. There are higher limits today than in past years and additional potential tax savings. Ask your accountant to calculate what this could mean for you, as you can make 2015 contributions up until April 15th of 2016. If you are making an IRA contribution for 2015, we recommend that you mail your contribution by April 10th. However, contributions mailed directly to the investment can be made if they are postmarked by midnight on April 15th. If you do not take advantage of these for this tax year, the opportunity will pass and you cannot go back. There are also very good reasons to add to Roth’s and non-deductible IRA’s, including doing them for supplemental education planning. If you made contributions to a 529 plan for education, these may be state tax deductible. Please let your accountant know your contribution amount.

Deducting Investment Fees – Some investment and management fees are tax deductible. Please mention this to your accountant to see if you qualify.

As always, we are here to assist, so please feel free to call or email us for additional information. You may also have your accountant contact us directly. We often speak the same “language,” and this can simplify many issues.

One final word of advice: we highly recommend that you do not spend your refund until you receive it; nor do we think it is wise planning to request a cash advance of your refund amount.

May 2016 bring you happiness and prosperity as we look forward to working with you throughout the New Year.

Sincerely,

The Musuneggi Financial Group

 

 

The information contained in this letter is not intended to constitute legal, accounting, investment, consulting, or other professional advice or services. For specific information that applies to your circumstances you should consult a qualified tax advisor. In accordance with IRS circular 230 disclosure, and to ensure compliance with requirements imposed by the U.S. internal revenue service, we inform that any tax advice contained in this article was not intended or written to be used, and cannot be used, by any taxpayer for the purpose of (1) avoiding tax-related penalties under the U.S. internal revenue code or (2) promoting, marketing or recommending to another party any tax-related matters addressed herein.

Congratulations to our NAIFA Quality Award Winners!

NAIFA Quality AwardCongratulations to Christopher S. Musuneggi and Christine Pikutis-Musuneggi, recipients of the 2015 National Association of Insurance and Financial Advisors (NAIFA) Quality Award.

This award is considered a mark of distinction for financial advisors, and it recognizes Christopher and Christine’s professionalism, quality service provided to clients, adherence to the NAIFA code of ethics, and service to the industry association.

This is Christopher’s third consecutive NAIFA Quality Award. Christine is currently President of NAIFA-PA.

New Year’s Resolutions: Stop Smoking, Lose Weight, Do Estate Planning?

The best way to get started is to quit talking and begin doing.”
~ Walt Disney

notebookjEstate Planning may not be found on a typical list of New Year’s resolutions, but if you have not competed your planning, then it should be. It doesn’t require willpower, it won’t take months to accomplish, and unlike some resolutions, once done, it will not pop up on your list again next year.

Now if you are thinking, I don’t need to do that because I am married and everything I have goes to my spouse; or everything I have is in a joint name; or, I don’t really own anything, so there isn’t anything to plan for…well, if these were valid reasons not to do a will (and in reality they are not!), they are still not reasons to go without a Power of Attorney or Living Will, which are essential parts of Estate Planning.

These are not reasons to have not updated your beneficiaries, or not prepared your Family Letter, or not done your Pre-Planning, or not reviewed the way your assets are titled. There is a whole lot more to Estate Planning than just having a will. And trying to save a few hundred dollars by not planning can often end up costing you or your heirs thousands of dollars.

Although having these documents was always important, in today’s world they are critical. Over the years, our firm has too often had to be a party to situations where the lack of correct documents has cost our clients time and money, put strains on their businesses, and even caused rifts in their relationships with family members.

And even if you do have these documents, you need to be sure they are not outdated. When you update your documents, be sure to contact us so that we can help to coordinate your beneficiaries with your updated wills.

If you have assets in your own name, you need a Power of Attorney. Your Power of Attorney is the person who can handle your assets if you are unable to. Appointing a Power of Attorney is not the same as adding someone else’s name to the account, which could cause a gifting issue or other serious problems. Many married couples believe that because all of their accounts are held jointly, they do not need a Power of Attorney. But IRA’s are owned individually, and if you are disabled your spouse cannot automatically act on your behalf for these accounts. And if you are the person who normally handles an account for another, such as a parent or even a spouse, there may be times that you need to act on their behalf when they are not here to sign or give consent. A Power of Attorney can help to resolve this issue, too. Remember that in accord with privacy laws, our firm is not permitted to give a child, a sibling, or even a spouse information on another individual’s account without written permission.

Once your planning is done, it will provide you with such peace of mind. But to finalize the process, you have to take one more step: introduce your Power of Attorney and your Executor to your Financial Advisor. If you are a client of our firm, we will ask you for a copy of your Power of Attorney. We will want to be sure that we can help if the time comes when you need our help the most. And we want to meet these important people before that time arises. That way they will be comfortable with us, and we will not need to get to know each other during a crisis.

So now as you are writing that list of resolutions, just remember…Stop smoking. Great! Lose weight. Good! Do your Estate Planning. Absolutely!

 

Yes, Christopher, There is a Santa Claus 

Nobody can conceive or imagine all the wonders there are unseen and unseeable in the world.”  — Frank P. Church, “Yes, Virginia, there is a Santa Claus”

 

By Mary Grace Musuneggi

With the onset of the Holiday Season, I find it easy to recall the days of my childhood and the memories of my Christmases past. When I was young, on random Saturdays, my mother and I would ride the streetcar to downtown and get off under the Kaufmann’s clock. I still remember the department store Christmas windows as we walked along Smithfield Street. I remember the bells of the Salvation Army Santa. I remember the Christmas music that filled the air.

The wonderful Christmas memories and traditions of my past are probably the reason that the Holiday Season is still as exciting to me as it was when I was a child. I have never let go of the joy and delight that the season can bring. I have never forgotten the Spirit of the Holiday. And I have never stopped believing in Santa Claus.

Almost 30 years ago, when my son, Christopher, was 10 years old, a group of his friends had 2013 gathered in our family room to play video games. The boys were talkingchris 10 about the hottest new game on the street, and as I passed by, Christopher called out to me, “Mom, can you buy this new game for me for Christmas?” I responded with, “We will see. Maybe Santa Claus will bring it for you.” With that the other boys began to laugh as they chided him with “You mean you still believe in Santa Claus?” And in a voice barely above a whisper, hoping I would not hear, Christopher replied, “No, I don’t; but my Mom still does.”

And I do. I believe in the Santa Claus that helps us find the time that we never seem to have the rest of the year. The time to shop and decorate and bake. I believe in the Santa that helps us find the extra energy needed to write out the cards, to wrap the gifts, to attend the parties, to cook the dinner. I still believe in the Santa Claus who in years where money was tight, somehow made it appear to help to pay for the gifts and the tree and the new outfits. And I believe in the Santa Claus that brings family and friends closer and makes us wish for Peace on Earth and Goodwill to All, no matter what the state of the world might be.

Although for some the holiday season may seem lackluster with the state of the economy, the endless negative news from the media, issues facing the country or because of personal or family concerns, more than ever, once again, I believe that Santa will appear bringing the blessings of faith and hope; the kindness of strangers and the love of family and friends; the miracle of sharing; the knowledge that all we have is all we need; and the realization that we still live in the greatest country in the world.

And when years have gone by these blessings will still exist, and hopefully our current struggles will be lost memories and Santa will continue to be part of Christmas.

We at The Musuneggi Financial Group wish this year that the miracle of Santa will be part of this Holiday Season for everyone we know.