Author Archives: John Kvale CFA, CFP

Drinking from a Financial Fire Hydrant …. Friday

In a two and a half day period of time, the Brain and I had less than 90 minutes of down time to digest the fire hydrant of information we were trying to consume…..

The divide and conquer technique worked like a champ as we not only have a large pad of notes to share, some great thoughts, but also some fun pictures as well.

If we were late on getting back to anyone, our apologies, but the delay was well worth it as we come back with great ideas and updates.

Today is a Friday, enjoy your day, the weekend and talk next week!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

Updates from the Conference – Today’s FOMC Announcement Analysis – Cyber Security …

As mentioned last week, the first in-person large conference in some time is going on this week…. It is very nice to see everyone “In Person” …. we had forgotten just how full the schedules are during these events … full day ahead …

Briefly our two most important topics so far!

FOMC – Federal Open Market Committee Thoughts for Today’s Announcment

Just after lunch hour today the FOMC lead by Jerome Powell are set to raise rates (Fed Funds Rates – think overnight checkbook rate) by .75% (75 basis points) ….

The experts here say focus on the future (for the record we have been crowing on looking forward throughout this slowdown see here and here – digressing) as the Wall Street chatter is a step down possibility at the next meeting to a .50% — a firming of the higher .75% increase as the next meeting OR an even softer talk of maybe no .50% would be market moving… again according to our experts…

Cybersecurity – No Email of Social Security or the Like Documents

Condensing this event into one important topic – we all need to make sure we do not send documents with Social Security numbers or the like through email…. the hackers are just too good…

This is more of a reminder for all… but as we enter tax season next year, a good reminder!

Alright, that is it for now, a quick jog and workout… then to breakfast and back in doors for a full scheduld of events today!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

October 2022 Financial Planning and Capital Market Review – DMA Reminder – By John Kvale CFA, CFP

Hello and Welcome to our October 2022 … Financial Planning and Capital Market Update!

If you are too busy to read, feel free to listen as we describe our post and thoughts in friendly podcast audio format as well as Video!

Dallas Museum of Art

2 PM Saturday Afternoon November 19th before Thanksgiving Weekend

Newbies –

We like to articulate our thoughts and review on a Monthly basis our Financial Planning Tips, Capital Markets thoughts and current events!

Hope you enjoy!

October 2022 Video

YouTube

Financial Planning Tip(s)

New Retirement Contribution Maximums

  • 401(k), 403(b), most 457 plans, increased to $22,500 (2023), up from $20,500 (2022)
  • Catch up for those over 50 is increased to $7,500 (2023), up from $6,500 (2022)
  • Total max 401(k), 403(b), most 457 plans including catch up is $30,000 (2023) up from $27,000 (2022)
  • limit on annual contributions to an IRA increased to $6,500 (2023), up from $6,000 (2022)
  • IRA catch up for those age 50 and greater remains $1000
  • Annual Gift Exclusion amount increased to $17,000 (2023) from $16,000 (2022)

Highlighted in this post

Capital Market Comments

Fastest Interest Rate Increase EVER – That’s a long time1

Our friends at Visual Capitalist are at it again with a superb chart we have been watching for, here in this post we highlight the following chart of just how fast this interest rate increase has been – fastest ever that is

Recall this is a TEMPORAY headwind to Fixed income instruments, that show up in greater magnitude due to the FOMC’s aggressiveness…

Have a Great Day, Talk to You at the End of October!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

First Group Convention in a Long Time … The Brain on Helpful Alert at the Convention … Friday

Next week, Donald “The Brain” and I travel (in separate planes – oh yes we do think of these things- planners- ok digressing) to a cooler … higher elevated climate for the first large group convention in four years and much longer for being at the same one together…

With family commitments we make it fast – heck even watching the weather for a smooth departure – we skip the big concert for a return to the kiddos….. but we will be inhaling as much information in a “divide and conquer manner” so as not to overlap events when possible…

As mentioned here, “The Brain” in funny coincidental terminology has been asked to carve out “Brain time” for other attendees to pick his Brain on the use of some very special technology in which he is not only a master power user but a helpful designer as well.

Will try to bring some good pics back for your viewing pleasure… but will certainly come back with lots of topics and ideas here in this venue for your continued review….

Ahhh, but that is next week and today is a very rainy Friday heading into an early fall weekend… enjoy and talk next week!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

Kastle Back to Office Update – New Measuring Index – Week Days in the Office … Ah ha

One of our favorite finds over the last two years is the Kastle Index… now indexes

For those newbies, this security company has taken the information and made it into a very useful index since they have the data from their security systems…

With a request from the field for more granularity on the calculation, (hat tip MR) a new data set/Index has been created that shows interesting but not surprising work characteristics…

Kastle Back to Work Barometer

Holding steady just below 50% – with some outliers on either side ..

Kastle Over Time Occupancy Measurement

Another view of the leveling off of back to work characteristics near the right of the graph…

Kastle Weekly View

Here is the new view that brings some clarity to the overall back to work index….. Monday and Fridays are clearly work from home days still!

We have lessened our reviews of this type of information, but still find this worth a look, especially if there are new data series, such as this!

Have a Great “Back to Work more Clarified” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

New 2023 Contribution Limits, 401k, IRA, Roth, SEP

Once again not surprising with the afore mentioned COLA adjustment on Social Security…. Retirement contribution limits were also adjusted by a large amount….

We find ourselves reviewing this amount so frequently and getting confused as the calendar turns as well as being in the next tax year but making contributions for the prior…. we are going to have a special tab here on our blog moving forward that will have two years data. The IRS Release.

So here we go!

Retirement Contribution Limits

  • 401(k), 403(b), most 457 plans, increased to $22,500 (2023), up from $20,500 (2022)
  • Catch up for those over 50 is increased to $7,500 (2023), up from $6,500 (2022)
  • Total max 401(k), 403(b), most 457 plans including catch up is $30,000 (2023) up from $27,000 (2022)
  • limit on annual contributions to an IRA increased to $6,500 (2023), up from $6,000 (2022)
  • IRA catch up for those age 50 and greater remains $1000
  • Annual Gift Exclusion amount increased to $17,000 (2023) from $16,000 (2022)

This takes care of the great majority of retirement plans…but for the record we do not like the formatting and will wait to post the new page once a more comprehensive and better formatted list is completed….

Have a “Fresh of the Presses IRS Retirement Increased Limit” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

Holiday Party Saturday November 19th – Dallas Museum of Art – Founders Room 2 PM Meet and Greet …. Saturday Before Thanksgiving …

We really like the novelty and tradition of the paper invite…but not the formatting issues associated with the sixth revision, to make it just “Perfect!” that dropped the day of the event…. grrrrrr

Thanks for all the jabbing…. much deserved… proves our originalism… oddly, in 26 years, this was not the first time this has happened!

Have a Great Holiday Date Correction Day! See you there!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

Fastest Interest Rate Increases Ever, and that’s a long time … Friends at Visual Capitalist

From our friends at Visual Capitalist

This is pressure for now, but pleasure as our income from our fixed pays out more!

When the Fixed Income market breathes, rates typically go down in a slowdown…. even with the Fed raising short term rates… actually especially when they raise short term rates…

Have a Good “Temporary Pressure Eventual Pleasure” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

8.7% Social Security COLA, Peripheral Effects, Pension COLA Reminder, SSA Neat Fact Sheet …

Last year we penned the following … in this post

HUGE Social Security COLA … 5.9% to Be Exact, Wow…. COLA Pension Recipients Check Your Benchmark

Looks like that was just the dress rehearsal… here is this years release…

Dall – E

With much talk of Inflation costs this year, the SSA (Social Security Administration) release this week of an 8.7% COLA (Cost of Living Adjustment) was not a huge surprise..

Important Items Associated with this Adjustment

Pensions – Folks with Pensions that have COLA adjustments should also watch for a similar increase – Your benchmark and adjustment will likely differ from SSA as they use the CPI-W three month average as noted here in our pre-post last year

Pre-Retirees – Those nearing Social Security, according to this neat fact sheet,

Maximum Social Security Benefit: Worker Retiring at Full Retirement Age goes from $3,345/mo. to $3,627/mo.

New Social Security Tax Base – Those still working, understand this COLA also filters into the SSA base income tax rate, again as mentioned in the press release

“Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $160,200 from $147,000.”

Have a Great “COLA Reminder” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

jkfinancialinc

street-cents

Third Quarter 2022 Review, Patience as we look back and forward

In this review, we have chosen not only to look back over the prior 90 days, like we usually do, but we also wanted to look forward as we go up to the end of 2022!

Patience is a Virtue

Jerome Powell (Chair of FOMC) and his fellow FOMC board members have continued to raise rates, much faster and much greater than many, including ourselves thought possible. Rewind back just to the beginning of the year and the federal reserve were actually pushing rates down, in a quick about face by the end of the first quarter, rates were on their way up an asset purchases by midyear had reversed and become asset runoffs. Their purpose is of course to slow inflation a.k.a. CPI (consumer price index), while with great intentions many of the inputs in the CPI index are very lagging and have likely already rolled over but have yet to feed into the actual report due to their delayed nature.

Patience is needed as mentioned in the bullet before this commentary and also greatly outlined in our Q4 2022 newsletter. In that newsletter, which you should already have in your possession, we outline the normal lengths of time that a slowdown occurs and what to expect from almost all angles. The main reason that we did this is to remind ourselves, and everyone else as well, as the last decade has garnered an unusually fast and short slowdowns and commensurate recoveries. With the FOMC on a continued rate increase, this slowdown is likely to be much more similar to prior slowdowns in both time and fatigue of the economy. Patience, we will get there.

Looking Forward but no Predictions

Using history as our guide, the fourth quarter is indeed usually one of the best. However, as mentioned above, the macro economy pulled down by the federal reserve and continued right increases may overwhelm seasonal historical blossoms and weigh down a normally sunny period on the calendar.

Contra moves in both Equity/Stock and Fixed Income/Bond

In slow downs, equity markets have an unusual tendency to slowly drip in reverse and then all the sudden make a jump forward only to slowly start dripping in reverse again.

In this economic cycle, we have a new asset class that is also participating, the Fixed Income Market. As mentioned earlier with the federal reserve and Powell on a continued increase goal interest rates on the longer end of the yield curve i.e., the 10 year (versus the very short one or two) have smartly slowly gone down only to jump backwards up again and then slowly begin their decrees again. Patience is again a virtue, a slowdown leads to lower rates eventually, even with the FOMC raising rates.  Patience really is a virtue, we will be there with you, thanks for your time and your patience

Sincerely,

John A. Kvale CFA, CFP

Enclosure (2022 Report)