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Another Decade Ends...Where has the time gone?
Why does it seem that the older we get, the faster time flies? It has also been said that "Time flies when you're having fun!". It is hard not to ask rhetorical questions as we close out the year, and the decade too.

We hope that whether one year or ten, time has been kind to you. May you find warm opportunities to enrich the lives around you in the coming year(s). The investment of time is the greatest gift of value one can bestow upon another. There is no time like the present to strengthen foundations by building new memories. Invest wisely today because tomorrow isn't promised. May your holiday season be filled with sharing and caring, living and giving, laughter and love.

  • Here's a heads up for those that may be coming to our office. Construction on a multi-use building is beginning catty-corner to our office. Additionally, the school construction across the street is commencing. There may be road closures periodically.

  • Teri and Tracey will be attending the TD Ameritrade Annual Conference in Orlando, FL at the end of January. We hope to learn more about the Charles Schwab - TD Ameritrade merger.

  • SPECIAL EVENT: We stumbled upon an amazing art gallery while we were at the Orion Launch conference in Omaha, NE. Coincidentally, the photographic work of Thomas D. Mangelsen will be on exhibit at COSI during 2020.  There will be a meet and greet at COSI on January 20, 2020. Check with COSI for exact time and admission cost. Additionally, Thomas Mangelsen will be a guest speaker for the OSU Environmental Film Series: A Life in the Wild on January 21, 2020. This event is free. More details are available at the following website:

  • The Morningstar Portal is no longer available due to the transition to Orion. We are working to launch the new Orion Client Portal for eligible clients very soon. We apologize for any confusion and appreciate your patience.

  • News broke on 11/21/2019 regarding merger negotiations between Schwab and TD Ameritrade. Details will be forthcoming. Please stay tuned.
+ Teri's World
Being a visual person, Teri views each month of the year as if she is jumping hurdles on a track. For some reason the hurdle for the month of December always seems to gets raised higher than the rest! This year is no exception. Adding a bout with the flu and a cold have made it a bit more challenging! Year-end tasks always increase the time spent in the office, but she has managed to keep pace with the season and enjoy time with family and friends. Earlier this week she lost her 150+ year old Catalpa tree next to her house. Hard to see it get cut down, but structurally it needed to be done. She is looking forward to a few days with the family in Hocking Hills over New Years. 
+ What about Bob
The late Thanksgiving has certainly accelerated the Christmas season. Bob & Christine had a great but very untraditional Thanksgiving weekend. They spent a good portion of it with their oldest daughter Ashley doing some shopping in downtown Westerville. They got their Christmas tree, put up the outside Christmas lights and didn’t eat turkey until Sunday afternoon. 

Bob and Christine had a great time with neighbors and friends at a local Newark Brewery watching the OSU/Michigan and then the Big 10 Championship games.

They are looking forward to spending a wonderful Christmas day with their daughters Ashley and Brittany and their families. 

Bob and Cris hope you have a great Christmas.
+ Tracey's Time
Tracey & Andy are looking forward to finding quiet moments amid the holiday chaos. The kids will be home for our traditional Christmas Eve dinner. Meals shared with family are truly special occasions and we appreciate sharing a meal in good company.

A new tradition we have established in recent years is for the family to see the holiday Star Wars movie release together in the theater. Soon we will have to choose a different event as Star Wars movies are sadly coming to an end.

Day to day we continue to taxi Cayleigh to her activities, currently including hockey practice and games, and guitar lessons. She has a guitar recital this weekend and we are excited to hear what she has been practicing.
+ Maria's Moments
December has been a busy month for Maria, she finished up her classes for the semester at Ohio Dominican University and has been preparing to celebrate the holidays with family. She will be enjoying her time off from school by spending time with family. Maria’s family will be traveling from California, Missouri, and Minnesota to Columbus to celebrate Christmas together. She is very excited to begin the new year and for all the new adventures that will come with it! 
Current Economic and Investment Information
ELECTION YEAR 2020 –17 of the last 19 presidential election years have produced a positive total return for the S&P 500 stock index. The only “down election years” dating back to 1944 were in 2000 and 2008. The S&P 500 consists of 500 stocks chosen for market size, liquidity and industry group representation. It is a market value weighted index with each stock's weight in the index proportionate to its market value (source: BTN Research).  
STOCK MARKET PREDICTIONS - A year ago (12/17/18), Barron’s published the year-end 2019 forecast for the S&P 500 made by 10 Wall Street strategists. 4 of the 10 predictions had the S&P 500 finishing 2019 at 3100, up from its 12/31/18 actual close of 2507. The S&P 500 closed last Friday 12/13/19 at 3169 (source: Barron’s). 
BOND YIELD PREDICTIONS - A year ago (12/17/18), Barron’s published the year-end 2019 forecast for the yield on the 10-year Treasury note made by 10 Wall Street strategists. All 10 predictions had the yield increasing from its 12/31/18 actual close of 2.68%, with 5 of the 10 forecasting a yield of 3.2% or higher. The yield on the 10 year Treasury note closed last Friday 12/13/19 at 1.82% (source: Barron’s). 
GERMANY- Just 1 in 9 households in Germany (11%) have money invested in the stock market today (source: Bundesbank). 

NET WORTH- If the nation’s aggregate net worth of $113.8 trillion was spread equally across all 122.7 million US households, every American household would be worth $927,000 (source: Federal Reserve).  
JUST U.S. INTEREST - The government paid $376 billion of interest expense on our nation’s outstanding debt during fiscal year 2019, i.e., a $1 billion per day (source: Treasury Department). 
NATIONAL DEBT- Our national debt is $23.1 trillion as of Thursday 12/12/19. If the United States was to pay down the national debt by $1 million a minute, i.e., $1.44 billion a day, it would still take 44 years to extinguish $23.1 trillion of debt (source: Treasury Department). 

BANKS - Through last Friday 12/13/19, just 4 banks had failed YTD and required a bailout from the Federal Deposit Insurance Corporation (FDIC). Since the FDIC was created in 1933 during the Great Depression, there have been just 3 years –2005, 2006 and 2018 – when there were no bank failures during the calendar year. 157 banks failed in 2010, an average of 3 per week (source: FDIC). 

U.S. POPULATION - 13.7% of the US population (44.7 million individuals), approximately 1 out of every 7 people, was born outside the United States (source: Census Bureau).

U.S. BIRTHS -The number of babies born in the United States has declined in 10 of the last 11 years, i.e., 2008-2018. There were 524,521 fewer babies born in 2018 (3.79 million) than were born in 2007 (4.32 million) (source: National Vital Statistics Reports). 

COLLEGE - There are fewer college students in 2019 (18.9 million) than there were 8 years ago in 2011 (20.4 million) (source: Census Bureau).   

EDUCATION -TENNESSEE - Tennessee offers tuition-free community or technical college to any of its high school students who graduate before age 19. Students must maintain at least a 2.0 GPA and complete 8 hours of community service each term. The state has 13 community and 27 technical colleges (source: Tennessee Promise program).
Who Owns American Treasury Bonds?

You often hear that the Chinese government might somehow strike back at the U.S. by selling off its Treasury holdings. But did you know that China is not actually the biggest foreign holder of the government securities?

This past June, Japan overtook China as the largest non-U.S. holder of Treasuries, with $1.17 trillion—above China’s $1.10 trillion in holdings. That’s 17% and 16% of the total, respectively. It’s unlikely that either country will decide to dump their American bond holdings, since the comparable alternatives around the world—now some $13 trillion in global government debt—are paying negative interest rates.

Japan’s and China’s total of $2.27 trillion ownership in U.S. bonds is, in any case, a small fraction of the $23 trillion U.S. debt. So who would be the biggest threat if it sold out America’s bonds? The Social Security Trust Fund is actually the largest single holder of Treasuries, with around $2.887 trillion. As we approach the year 2026, when inflows are scheduled to fall below outflows, the trust fund will be steadily liquidating Treasuries, but initially at a fairly slow pace.

The other holders of American debt? The U.S. Federal Reserve, after its QE policies, now owns $2.46 trillion in Treasury bonds. American pensions are holding $2.8 trillion, mutual funds another $2.1 trillion, individual investors own $1.8 trillion, and banks and state/local government funds together have invested around $1.4 trillion in U.S. government bonds. Other significant investors include the United Kingdom (5% of total debt, or $323 billion)), Brazil (4.4%; $306 billion), Ireland (4%; $271 billion) and Luxembourg (3.7%; $230 billion).


Hot off the press, it is expected that President Trump will sign the bill today and it will become law today. We had a conference call earlier today on some of the particulars that helped to clarify some key concerns. There are many changes but I will highlight a few. One, if you turned 70 ½ this year, you will continue to take your RMDs going forward. Otherwise, if you are less than 70 ½ by the end of this year, your RMD will begin the year you turn 72. Two, if you are still working after age 70 ½, you can now continue to make traditional IRA contributions. Three, if you have inherited funds in an IRA from someone who has died this year, you are under the old stretch IRA rule. If you inherit funds after December 31st 2019, you are under the new rules where all funds must be distributed within 10 years. Four, they have expanded the payout rules under 529 plans allowing up to $10,000 to be applied to student loans for an individual or for a sibling. Lastly, there are numerous changes to 401-K plans and too many to address at this point. So stay tuned…  
Spending Bill Includes Seismic Retirement Changes, Curtails Stretch IRAs

By Ashlea Ebeling
Forbes Staff

The just released 1,773-page $1.4 trillion 2020 spending bill means many Americans will be rewriting their retirement plans—if it gets signed into law before the holidays as expected. It includes the SECURE Act—Setting Every Community Up for Retirement Enhancement Act of 2019—which passed in the House 417-3 in May but stalled in the Senate. Basically, the whole SECURE Act was brought over, including the “pay for” revenue raising provisions.

“The most significant piece of retirement legislation in a decade could become a reality, after all,” says Brian Graff, CEO of the American Retirement Association.

The American Council of Life Insurers was quick to send out accolades: “[The SECURE Act] would mark a significant step toward modernizing America’s retirement system for workers.”

What’s in it for life insurers? A fiduciary safe harbor provision that will make it easier for employers to offer retirement plans with lifetime income options through annuities.

Also, there are increased tax incentives for small employers to offer retirement plans in the first place. The bill increases the tax credit for new plans from the current cap of $500 to $5,000, or $5,500 for plans that automatically enroll workers. Rule changes will make multi-employer retirement plans, where two or more employers band together to offer a plan, more workable too.

The pay-for that will get the most attention in the retirement planning community is the imposition of a 10-year payout rule for beneficiaries of inherited retirement accounts.

Here’s a rundown of some of the major retirement changes in the spending bill.
(Forbes’ Kelly Phillips Erb explains here how the spending bill would kill three Obamacare taxes.)

It would allow part-time workers to participate in 401(k) plans. 401(k) plans typically require employees to work 1,000 hours in a 12-month period to participate in the plan. The new threshold would be 500 hours for three consecutive years. Note: This isn’t mandatory, so it’s in the employers’ court, and it wouldn’t be effective until January 1, 2021.

It would increase the age for required minimum distributions from 70½ to 72. Instead of having to take out annual RMDs from your 401(k) and IRA starting when you turn 70 ½, the minimum age would be 72. This would be a boon to most taxpayers who can afford to delay taking money out (it’s estimated it will cost the Treasury $8.9 billion over the 10-year budget window).

It would eliminate the prohibition on traditional IRA contributions for those age 70 ½. So, older workers would be able to save on a pre-tax basis and boost their retirement kitties. This is important given that folks are working longer and facing increasing longevity.

It would allow penalty-free retirement plan withdrawals for new parents. Within a year after a birth or adoption, new parents could take up to $5,000 from a 401(k) or IRA or other qualified retirement plan.

It would require inherited IRAs to be depleted within 10 years. This is the provision that will pay for virtually everything else—bringing in an estimated $15.7 billion to the Treasury over 10 years. It will upend estate planning. Today IRAs can be stretched out over beneficiaries’ lifetimes, providing decades of tax-deferred (or tax-free in the case of Roth IRAs) compounding. Instead, most IRA beneficiaries (not a spouse) would be required to deplete an inherited IRA within 10 years, accelerating—and likely increasing— taxes owed and destroying creditor protection for IRAs held in trust. Forbes contributor Leon LaBrecque explains how the 10-year rule could cost your kids here.

Two-Thirds Of All Americans Are Missing This Estate Planning Document

By Megan Gorman, Senior Contributor
Estate planning is a complex world for most Americans. For many, the process can seem overwhelming and expensive. For others, it is uncomfortable to confront one’s mortality and requires tough decision making. But regardless of one’s feeling on estate planning, there is one estate planning document that all Americans should have: A Health Care Directive. 

But what exactly is a health care directive? It is a legal document in which an individual specifies their decisions for caregivers in the event of illness or dementia and directs end of life decisions. It can also provide guidance on how the caregivers should handle the body after death.

Health care directives are also known as living wills, durable health care powers of attorney or medical directives. But they all serve the same function: to provide guidance and direction on how one’s medical and death decisions should be made.

The Impact of Estate Planning

While wills and trusts have been around for centuries, health care directives are a relatively new legal document. They came into existence in 1976 when California passed the first law that permitted health care directives. By 1992, all 50 states had similar laws. 

That the law was so quickly accepted across the country is an indication of why these documents are so important in today’s world. A key concept is that of control. Estate planning allows us to have control on certain issue when we are impaired and after our death. 

Yet despite how important a health care directive is, a 2017 study found that only a third of all Americans have one, which is surprising since both attorneys and health care professionals advocate for this document. 

While we often think of death as a single event, in most cases it is a process. As we work through a directive, it is important to visualize how each step will play out.

Choosing the Right Agent

A key decision in a health care directive is choosing one’s agent. The agent is a proxy who acts on your behalf to make decisions that are consistent with your wishes, so it’s important to pick someone whose values are aligned with yours. The agent is your advocate on decisions such as whether you want to have treatment continued or just be kept comfortable in palliative care. These are intimate, life changing decisions. For most married people, the spouse is a likely choice for this role. For the contingent agent, adult children, other close family members or friends can be ideal.

Once you choose an agent, you should sit down with the person and go through the directive. Hearing you explain your decisions and thoughts will provide guidance for them if and when the need for them to step in arises.

After One Passes

The agent’s role in the health care directive does not end at death, but continues to ensure that our post-mortem wishes are carried out. When the individual passes, the agent takes control of the body. Even before the funeral plans are addressed, the agent has to make sure that any organ donation wishes are carried out. Often this decision is indicated on one’s driver’s license, but it is also restated in the health care directive. If an individual chooses to donate their body, their health care directive can provide important details. In most states, there are four choices for donation: transplant, education, research and therapy, and options for further parameters as well. For instance, if someone wishes to donate only certain body parts, this can be made explicit in a health care directive.

Once donation wishes are carried out, the agent helps to make sure funeral wishes are handled properly. Burial is an ancient ritual. From the preparation and disposal of the body to the accompanying religious rites, it is a time-honored tradition. But never before have we had so much choice in how we want our bodies to be handled after our deaths. In the past, many felt bound by religious tradition, but funeral planning today is much more a reflection of an individual’s values.

These instructions can be listed in the health care directive and can be as simple as burial or cremation. But there is flexibility with how elaborate you wish to be in detailing your funeral plans, including who you want for your eulogy, songs to be played, even the selection of flowers.

Be Proactive

Ultimately a health care directive allows you to control an important part of your legacy. You will have a clear voice in the decision-making process from medical decisions to funeral procedures. It is important to take care of this document sooner rather than later. Fortunately getting one is relatively straightforward, since most states offer a statutory form that can be found on the state Attorney General’s website. 

Once this is put in place, despite all apprehension about the estate planning process, you will likely feel you can rest easy having gotten this part of your life in order.
"Maybe this year, we ought to walk through the rooms of our lives not looking for flaws, but looking for potential."

- Ellen Goodman

Alexander Financial Planning
1621 W. First Avenue
Grandview Heights, OH 43212

Registered Investment Advisor
This material is distributed by Alexander Financial Planning, Inc., (AFPI) and is for information purposes only. Although information has been obtained from sources to be reliable, we do not guarantee its accuracy. It is provided with the understanding that no fiduciary relationship exists because of this report. Opinions expressed in this report are not necessarily the opinions of AFPI and are subject to change without notice. AFPI assumes no liability for the interpretation or use of this report. Financial planning, investment conclusions and strategies suggested in this report may not be suitable for all investors and consultation with a qualified advisor is recommended prior to executing any investment strategy. All rights reserved.