April 2016
April Insights
Let me first congratulate Danny Willet on winning the 80th Masters Golf Tournament on April 10th. It certainly was a tournament for the ages. I must also congratulate 22 year old Jordan Spieth, not only for his valiant attempt to come back from a disastrous four over par 12th hole, but also for the interview he did just after the match ended. You could see the pain in his face, but he acted with integrity and grace.

Integrity is a word often used in our industry to express how we do business. As a fiduciary, integrity is the cornerstone under which we operate. A fiduciary is required to always put the best interests of the client or beneficiary first, above profits. Earlier this month, the Department of Labor issued a new rule stating that retirement investment advisers will be required to meet this standard. 

Reading about this new rule made me wonder; wasn’t there already a suitability rule in effect? Under FINRA’s (the Financial Industry Regulatory Authority) suitability rule, firms and their associated persons “must have a reasonable basis to believe” that a transaction or investment strategy involving securities that they recommend is suitable for the customer. It is a reasonable belief that must be based on the information obtained through reasonable diligence of the firm or associated person to learn the customer’s investment profile. Here is some basic information required to determine if an investment is suitable for the customer:

Age of customer;

Investment time horizon, such as the expected time available to achieve a
particular financial goal;

Liquidity needs, which is the customer’s need to convert investments to cash
without incurring significant loss in value; and

Financial situation and needs, which might include questions about annual
income and liquid net worth to name a few.

©2016 FINRA

Makes sense doesn’t it? So my question, why is  it necessary for a new DOL rule requiring advisors overseeing retirement accounts to act under a fiduciary standard placing the interests of the client first when there is a suitability standard in place? At Garden State Trust Company placing the interests of the client first is not just a rule, it is the foundation upon which our company is built. Our clients trust us to deliver our services with integrity and that is what we have always done.

Our focus always has and always will be where it should be, on you, on your family and on your future.

Hopefully, we will finally have some warmer weather and for those of us that play golf dream we are playing Augusta National.

With best wishes,

Below are a few articles which we hope you find useful. Let us know your thoughts and reach out with any questions. 
Zuckerberg's Choice

Last year Facebook Chairman and CEO Mark Zuckerberg and his wife, Dr. Priscilla Chan, dedicated 99% of their Facebook shares to charity. The estimated value of the commitment was then $45 billion. The couple chose not to follow the example set by Bill and Melinda Gates, in that they did not set up a private foundation to manage their charitable endeavors. Learn More.

Rent or Own?

In 2009 the average age of a home seller was 46. Last year, according to the National Association of Realtors, it was 54. The Wall Street Journal reports a notable increase in the number of older renters. There were an estimated 7.5 million renters age 55 and older in 2005, and about 10.8 million in 2015. Learn More.

Rocky Start

April 4, 2016—Equity indices tumbled in January, amid uncertainty about global economic growth, oil prices and developments in China. Oil prices bottomed in February, and stocks slowly struggled back to where they’d started the year. At the end of the first quarter, the S&P 500 was up 13% off its lows, up 0.8% on the quarter. Learn More.
Because of the rapidly changing nature of tax, legal or accounting rules and our reliance on outside sources, Garden State Trust Company makes no warranty or guarantee of the accuracy or reliability of information contained herein nor do we take responsibility for any decision made or action taken by you in reliance upon information provided here or at other sites to which we link. © All rights reserved. 
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