August 2014 Newsletter to Clients

Enjoy this month’s edition which starts with the birth announcement of Chase Hammond. From there, we discuss the importance of saving for the future, sooner rather than later. We also have a quick summary of the economy. Then we discuss the importance of notifying us of life events and creating an estate plan.

Ramsey Bova and Robert Hammond welcomed the birth of a boy, Chase Benedict Hammond, on August 1, 2014 at Baptist Health Lexington. At birth, Chase weighed 7 pounds, 13 ounces, and was 19.5 inches long. He joins big brother, Pierse Hammond.

A person who contributes the maximum to a Roth IRA beginning at age 19 will have accumulated $330,000 more than one who begins contributing at age 25, by the time each person is 67. It pays to begin saving early and a Roth IRA is a must.

The economy seems to be working pretty well, notwithstanding persistent high unemployment. The residential real estate market is recovering. Consumer confidence is up so people are spending more freely. The stock market ignores most bad news. The Dow Jones Industrial Average has recovered from about 6,500 in 2009, five years ago, to 16,500+ at this writing.

When you decide to move, please tell us rather than our having to find out via a family grapevine. A change of state residence may affect your will. Also, if you’re taking regular IRA distributions, the change may affect state income tax withholdings.

We all inevitably face our own mortality, sometimes with notice but often without. Everyone needs a Death Plan.

The plan should be in place for the person who is left behind. That “lucky” person—the second to die—faces daunting tasks and may have little help. Share the following with your mate, sibling, friend, or whoever will handle your affairs after you die.

Create a list of contacts and a list of volunteers to assist with the contacting. Relatives, fellow workers, advisers, etc. are the first priority.  In my case, my wife notifies our children and her sister. Her sister will contact my brothers and sisters, who will be asked to contact my other relatives. My children will contact my fellow workers and a short list of close friends.

Where are your online passwords, checkbooks, will, and the key to your safe deposit box? In my case, because we split our time between Kentucky and Florida and travel frequently, nearly all of our bills are paid automatically through direct debit from checking and/or credit cards. And the credit cards are automatically paid from our bank accounts. Your mate needs to know these secrets and how to access the various accounts. Teach your partner your personal bookkeeping system; share records such as information about your life insurance and the location of policies. My wife will have to learn Quicken, and it is my responsibility to start training her today.

Share your desire about a funeral, memorial service, open or closed casket, cremation or burial. What should be done with your personal property, cell phones, computers, automobiles, watches, and jewelry? Enough of this death stuff for now. Just remember that we don’t always get a warning that the end is near, so start working on it now!

Thanks for your continuing confidence and referrals.

Past performance is no guarantee of future results. The opinions expressed are those of Moneywatch Advisors, Inc. and are no guarantee of the future performance of any particular fund. This information is for educational purposes only and is not intended as investment advice. Please consult your financial advisor for more detailed information or for advice regarding your individual situation.