Category Archives: Insurance

October — BOOOO- 2018 Podcast Video, Financial Planning and Capital Market Update – By John Kvale

Hello and Welcome to our October 2018 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 format as well as Video!

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

A Special Congrats to the Capones growing family!

Nathan Elliott Capone

Nathan Capone

October – Booo – 2018 Video

Break In – Holiday Party Reminder

10-9-18 - Holiday Party Invitation

 

Financial Planning Tip (s) –

RMD Season

In our explanative post here, we overview the RMD season items …. and remind those in the first year of their chose to defer or take …

  1. RMD $$ mandated amounts are determined by the value of applicable accounts on the last day of the prior year
  2. Current year age is a necessary factor included in calculating the RMD – see below next, first time exception – each year of seasoning (getting older) we are forced to take more out of the applicable accounts – hey the IRS has never taxed us on these in many cases – it’s their time!
  3. After tax contributions to a qualified account MUST be accounted for in order to avoid taxes – here are greater details and our taxpayer obligations on this –  don’t overpay – the IRS is not tracking this and will not come to the rescue and lower your taxes
  4. All of an individual’s accounts must be included/totaled/value (certain exceptions are made to those continuing to work) to ascertain the needed distribution
  5. Any one account can be used to satisfy the needed distribution (you do not have to take a little from each account, making it easier from an organization standpoint) BUT you must take at least the minimum distribution
  6. Failure to take the mandated distribution amount COULD result in a 100% tax – Break in – our experience has been the IRS is nice about this, but let’s not test them

Social Security COLA Bump

Congratulations to those on a fixed income, the Social Security Administration SSA’s favorite inflation gauge measured a 2.8% increase, which we review in our post here and also even created this neat historical graph for our collective review…

2019 Cola SS

 

Capital Market Comments –

Suddenly it’s Raining?

After a drop at the beginning of 2018 – mostly blamed on a creative synthetic product that bets risk will stay low (XIV) our patience was rewarded and footing found … until Ugly October came to roost…

What Gives?

At this time, no one with 100% certainty, can pin point what turned the market sky’s grey and sent rain…

Oddly, it may not be any one thing, just like an auto accident – usually multiple items occur at the same time that lead to an opening for contact with another …

Here are our best thoughts in order of our priority/possibility – again no one knows for sure…

  1. Trendy high flying stocks that have been a momentum favorite, suddenly took it on the chin – alone in time not a big deal – seen next
  2. Most mutual funds and many other assets managers close their books at the end of October – many heavily invested in the above trendy stocks had their year turn very ugly right at the finish line, possibly setting a musical chair like exit, causing much more volatility than what would have otherwise occurred if not so near the end of many fiscal years – an extra worry juggle ball in the air
  3. Mid-Term elections are finally here, and it is unlikely anyone can predict with any certainty the outcome of the elections – capital market participants hate uncertainty – not a big deal if this was all they are watching, but another juggle/worry ball up in the air
  4. Interest Rate Increase banter on how many an how long rates will increase before being “Normal” – we have discussed in great length the inverted yield curve and while we are no where near this event, yes… another juggle worry ball in the air
  5. Tarif Talk has been around all year, but looks to come to more of a peak near the end of the year – yet another worry/juggle ball up in the air

The good news is the sun will likely come out again soon, but in true rain like fashion, it seems like the days go by SLOOOOWER when your stuck inside, under cover, without sun!

The GREAT news is earnings have been for the most part very good, not GREAT and screaming as they had earlier in the year, but still very good by comparison.

MAYBE ? – we are just overdue for a correction – This fantastic chart from our friends at JPMorgan reminds us all that these type of corrections are more of the norm, not the abnorm – we have just been without regular bouts for some time!

Q4 18 JPMorgan drawdowns

Have a Great Day – Talk to you at the end of November!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
street-cents

Q 4 2018 Newsletter Video Audio Podcast Review By John Kvale

Welcome to our Video and Audio Podcast Review of our Q 4 2018 Newsletter. For those on the road or just unable to grab the time to read, our podcast type review gives you the behind the scenes insight to our thoughts, observations and deep views of the entire Newsletter.

Click Here for direct link to an electronic version (an early peek-good ole fashion paper versions are on their way to you shortly) and here for our Newsletter page

BREAK IN – Save the date for the Holiday Party

November 17th – Saturday before Thanksgiving – Dallas Athletic Club from 3-5 pm

DAC

Let’s get going!

Q 4 2018 Newsletter

And here is your review!

Capital Market Talk

Earnings and Markets Eventually Converge

In this hugely in depth article, first we discuss the effect of earnings eventually driving capital markets, but disconnects can occur. It can even be a good thing for Capital Markets to WAY underperform earnings, as they are this year because in brings valuations back in line.

Here is the key graph

7-13-18 EPS Growth and Mkt Growth 10 year avg

Higher Rates, a Short Term Headwind, Eventually a Tailwind

With sustained lower rates over the last decade, memories have faded on the tugging headwinds that higher rates have – IN THE SHORT TERM – on the mandatory safety asset class of bonds.

Higher rates are a great thing as Bonds/Fixed Income Assets have a place for almost all investors due to their safety and liquidity.

Once the headwinds subside our fixed income investments will have ridden the yield curve higher and begin paying more income in the form of yield – into our pockets – Finally!
bond index V Interest Rates

Too High of Rates Can Create Trouble

Too high of rates or an overshoot CAN create trouble … or a recession…

Our friends at JPMorgan – historically show that rate is about 5% – yea FIVE percent –

We disagree and think a lower level may now be this tipping point, due to the decade low interest rate level we have just experienced-

Current at two percent, we have a long way to go before getting too antsy
JPMorgan Rate Level for Slowdown

Inverted Yield Curve Update

So far to good- no inversion yet!
9-28-18 90 day to 10 year Inverted Curve status

Financial Planning

This series of articles came out of no where and in like domino fashion, once one was done the next took form and fell into place-

PLUP graph

App of the Quarter – Hardware

Our editor took the fancy picture out due to copyright fears, but our experience with the Firestick has been exceptional – Here are the highlights of our findings

  • Great Savings compared to just full service in many cases
  • Does not take as much internet speed as we thought
  • Bring your home on the road
  • Multiple devices used at once
  • Cuts back on duplicated services
  • Allows cherry picking services

Enjoy the fall –

See Ya next Year – Wow 2019 here we come!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

September 2018 Podcast Video, Financial Planning and Capital Market Update – By John Kvale

Hello and Welcome to our September 2018 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 format as well as Video too!

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

This is month two of our upgraded Laptop, which means a new recording system of Audio and Video — while still working the kinks out, we are getting the hang of it – Enjoy!

September 2018 Video

Financial Planning Tip (s) –

The Emergency FundMoney - dollar-941246_1920

In our post here, a shortened version of an article in the coming Newsletter, we review all, about a much needed Emergency Fund, and the levels for certain scenarios.

Reasons to be slightly bigger-

  • Possible Job Change – Need to be higher on emergency funds
  • New Family Member- Higher is better
  • New Home – Expect unforeseen expenses – they always occur (Has anyone ever built or bought a home in less time and for less money than they thought? Nope, it’s in our nature)
  • Salary Fluctuations i.e. Commissions – Error on the higher side of that emergency fund
  • Others dependent on you – Business owner, large family, solo income earners, college or wedding – Higher is better

Reasons for a normal to smaller Emergency fund-

  • Dual Similar Incomes – Lower Emergency fund is ok
  • Very stable Job – Smaller side of the living expenses will
  • Very fixed income stability – Pensions, Social, etc.

High Deductibles – Why to Consider

In this post, we discuss the reasons for considering a Higher Deductible lifestyle –

Break In – There are always situations that a High Deductible will not work, we are just pointing out the advantages, under the correct circumstances!

Auto Insurance: One of the best ideas to consider a high deductible – take a look here at the great examples of why.

Home Owners: Another great coverage to consider a higher deductible.

Health Insurance: Once again a good one, but certain situations can easily negate the advantages of this!

Capital Market Comments – Interest Rates and Bonds

Short Term Headwinds Of Higher Rates on Bonds

This busy chart gives a great picture of the short term effects of interest rates on bond. Coming from such an extended long period of unusually low rates, we are reminding ourselves along with everyone else, this is very normal phenomenon and will correct itself with time by putting extra dollars in our pockets in the form of higher yields.

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.

www.jkfinancialinc.com

street-cents

Why we like High Deductibles!

As we worked on our PLUP – Personal Liability Umbrella Policy Newsletter and Blog Post, we repeatedly ran across reasons to discuss our fondness to the Higher Deductible options on almost everything.

This article has also spawned a related article, about Emergency funds – neat chain of events articles!

Consider the High Deductible Option – On Most Everything

Health Insurance, Auto Insurance and Homeowners are the main types of ongoing insurance that allows you more control in your cost via the deductible.

The Auto Insurance Examplecrash-test-1620591__480

One of the easiest examples is the good old automobile insurance. We like high deductibles of near one thousand dollars due to the tremendous longer term premium savings that will occur over time. We certainly acknowledge that changing your coverage deductible to a higher amount today and having an accident tomorrow is bad luck and will throw you into the hole, but over time, if you are not a repeat offender, your saved premiums will more than pay for the higher deductible.

Health Insurance Example

Let’s face it, the insurance industry wants us as consumers to take more control over our medical expenses. Rather than run, embrace this coming inevitable change, and review higher deductible health insurance plans. Similar to the Auto example, if you opt for a higher deductible plan and something happens in the very short term, you will be in the hole on this decision, however time is your friend.  Having your health coverage pay for that visit to the Dr. for a cold is nice, and may make you feel good after you leave the office, however if you dig deeper, it is likely you may be paying dearly for the “free” visit.

Homeowners Insurance Deductible

Yep, there is a higher deductible option for your homeowners policy as well. This option is usually in the form of a percent of the dwelling. Be careful when reviewing these options as our experience has shown premiums and out of pocket costs can vary greatly depending on the geographic area of your dwelling and a higher percentage deductible can get out of hand if you are not careful on a higher priced dwelling. Bottom line, the homeowners policy has more moving parts due to the differences in coverages, geographic area, dwelling itself and your claim history. Take extra time in adjusting this deductible, but once you get clear on all costs, obligations and options, it’s likely you will find savings in this as well.

Have a Great “High Deductible Savings” 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

Mother Nature FLEXES her Muscles – High Deductible Pre-View – Friday

With a crew that absolutely loves the outdoors – beach, mountain, desert … heck they might even like a rainforest (never been with the whole gang.) Mother Nature has an influence on our lives.

Mother Nature FlexesHurricane -tropical-cyclone-63124__480

We wish the best for those in the mighty Mother’s path. With the most visible storm making landfall to our friends on the mid eastern coast line, and one of our far west states/islands are also dealing with her muscle flexing….

Safe wishes to all!

High Deductible Preview

Next week we continue our found series (PLUP, Emergency Fund-) with the last depending part, the High Deductible. Thanks for all the responses, we have greatly enjoyed sharing and will have full versions in the coming Q4 Newsletter.

Of course it’s a Tennis weekend, but long time followers will be surprised to know this weekend unusually includes little Brother in a Sunday match while older sister watches and gives important advice…..

Today is a Friday, enjoy your day and the weekend .. be safe and talk to you 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

Anniversary Payback Travels – Jen’s Baptism By Fire – Writers block confession, Lot’s of Neat Posts Coming

Long timer followers know we had a crazy Summer with the 13 year old’s tennis schedule…

As such, the Mrs. totally missed any real vacation over the summer together — Even the anniversary came and went without even a dinner or card — yikes – (18th!)tennis-2042723__340

Pay Back Anniversary Travels

Today and the next two days I will be out of the office/state and attempting to be loosely tethered via technology for Anniversary payback time!

Yes it is Jen’s second day as official pilot – but she has piloted much bigger planes before (more on this soon) – you are in good hands as Donald the Brain is still far from “Table for Five too!

Writers Block Confession

In full fess up mode, there are times when it is hard to write (not usually, but it happens) with nearing 2000 posts and counting, we are happy to give you a heads up — No writers block now!

WE HAVE TONS to talk about soon!

The PLUP article spurned two more articles that we think you will really like-

PLUP graphPlus we have had great ideas coming from you guys in the field– keep them coming, we love discussing hot repeating topics!

Ok … so an Anniversary Travel announcement turned into an exciting preview of coming great topics — We really like what we do – All good, all fun!

Have a Great Day and talk to you 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.
www.jkfinancialinc.com
street-cents

August 2018 Podcast Video, Financial Planning and Capital Market Update – By John Kvale

Hello and Welcome to our August 2018 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 format as well as Video too!

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

Break In – We finally upgraded our Laptop, which means a new recording system of Audio and Video — five year old laptop technology was long in the tooth – Hope you Enjoy!

August 2018 Video

 

Financial Planning Tip (s) –

The PLUP – Personal Liability Umbrella Policy

In our post here, a shortened version of an article in the coming Newsletter, we review the PLUP or Personal Liability Umbrella Policy- You likely need one!

Cost

In a world of sometimes seemingly ever higher costs, the PLUP is very affordable. Experiences have shown annually, cost of usually between $200 – $500 for $1 Million – $2 Million in coverage.

Insures your base Coverage are correct

Another neat and settling feature of the PLUP is that it mandates that your standard or base coverage are correct.

What you are protecting Coverage

The most obvious assets at risk are after tax dollars such as checking, savings and investments including Revocable Trusts.

Estate Planning Part 1 – Wills and the Basics

In a reappearance due to constant usage, we also brought back our Estate Planning Series here, Part 1.

  • Will
  • Power of Attorney
  • Healthcare Power of Attorney
  • HIPPA – Release of health information
  • DNR- Cease and Decease – Do not Resuscitate

Estate Planning Part 2 – Trusts

In Part 2, a second repeat article, here, we discuss Trusts of all sorts and their usage.

  • Revocable Trust
  • Testamentary Trust
  • Irrevocable Trust
  • QTIP- Qualified Terminal Interest Trust
  • Credit Shelter A/B Trust
  • Generation Skipping Trust
  • Irrevocable Life Insurance Trust

Capital Market Comments

Small Business Optimism Hits All Time High –

With earnings booming it is not surprising to see Small Business Optimism reaching all time highs — It is always nice to recall that while there are fast moving machines, making trades in nanoseconds and huge amount of data is being deciphered electronically to get and edge – BUT and it is a big BUT – There is ultimately a human behind the machine!

She/he is pretty happy!

8-15-18 Gallup Small Business Optimism

Have a Great Day – Talk to you at the end of September!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.

A Dallas Texas based fee only

Financial Planning Total Wealth

Management firm.

www.jkfinancialinc.com

street-cents