In this episode of the Planned Solutions Incorporated Podcast, The US yield curve, the graphical depiction of US interest rates for different maturities, has inverted between the 2-year and 10-year maturities. Some argue that this signals a slowdown in the rate of US economic growth. However, historically the differential between the 2-year yield and the 10-year yield has been a poor indicator. Meanwhile, the more accurate difference between 3-month Treasury bills and 10-year Treasury bonds continues to signal strong economic growth over at least the next 12 to 18 months.

Also, As the Fed has increased short-term interest rates banks have been slow to respond by raising rates on money markets and CDs. However, US Treasury interest rates have increased so that in many cases they now exceed the yields offered by banks. In addition, Treasury interest is not subject to state incomes taxes making the after-tax yield even more attractive to investors in states with an income tax.

And, Taxpayers who need more time to file their 2021 income tax returns may file for an extension of time to file their returns. The IRS now offers multiple options to file an extension and make any necessary payments. This includes submitting a paper request for an extension of time to file or an electronic request using the IRS Direct Pay website. The IRS Direct Pay website also allows taxpayers to make electronic tax payments should there be an expected amount due.

Plus a look at the Planned Solutions Incorporated Office Bulletin Board- The 2021 personal income tax return deadline is right around the corner. Taxpayers have until April 18th to file their personal income tax returns or apply for an extension of time to file. However, an extension of time to file a tax return is not an extension of time to pay any tax that may be due. Therefore, taxpayers should complete as much of their tax return as possible before April 18th to determine if there is likely to be an amount due. If there is a projected balance owed a payment should be made with the request for an extension to file by April 18th. Taxpayers who file for an extension but fail to pay any tax due may be subject to a late payment penalty as well as interest on the amount due up until the date the tax is paid.

Now that tax season is nearing an end, many taxpayers are wondering how long they need to keep their tax records. For most taxpayers, the statute of limitations for the IRS to audit or make changes to their tax return is three years from the due date of the return or the date the return was filed, whichever is longer. Therefore, most taxpayers may destroy their records from the 2018 tax year after April 18th, 2022.

Chase Armer's book- Financial Planning Insights is now available at:

www.amazon.com/Financial-Planning…1586894022&sr=8-1

To subscribe to the Personal Finance Review (the written form of all the content we discuss on the podcast) please e-mail [email protected]

The Personal Finance Review is published and distributed on a biweekly basis by Planned Solutions, Inc. for informational purposes only. Please seek the advice of a qualified financial planner before taking any action.

Planned Solutions, Inc.

ADDRESS: PHONE:

1130 Iron Point Road, Suite 170 (916) 361-0100

Folsom, CA 95630 (800) 750-2111

E-MAIL: FAX:

[email protected] (916) 361-0191

WEB SITE:

www.PlannedSolutions.com

#finance #invest #investment #stocks #inflation #deflation #bonds

In this episode of the Planned Solutions Incorporated Podcast, The Federal Reserve Open Market Committee recently switched gears from its low-interest rate stance to stimulate economic growth and job creation to a higher interest rate stance to combat inflation. This has caused some to predict a period of stagflation where economic growth is slow, and inflation is high. However, most economic data, as well as the Federal Reserve's statement, indicate that the US economy is strong enough to withstand higher interest rates.

Also, Oil prices have experienced extreme levels of volatility in recent weeks with prices increasing 9% in a single day as well as declining 11.5% later in the same week. Some of this price change is undoubtedly caused by the uncertainty surrounding Russia’s invasion of Ukraine, but some of the price volatility is also likely the result of speculators buying and selling oil futures to profit from price changes or hedge other investments.

And, there are certain circumstances where an individual may end up having a tax basis in their IRA. The basis amount is tracked on their income tax returns on Form 8606 and is carried forward from year to year. It is very important to maintain accurate records of this tax basis to determine the amount of any future IRA distributions that will be tax-free. In addition, the tax basis in an IRA can be transferred to the account beneficiaries which may reduce their tax liability as well.

Plus a look at the Planned Solutions Incorporated Office Bulletin Board- The war in Ukraine has created another type of war, a ratings war, with even normally reputable news organizations resorting to hyperbole and exaggerated claims in an effort to lure in viewers and readers. This is making it more and more difficult to get access to rational, balanced, and objective analysis about what is going on in Ukraine and the implications that it may have for the global economy. In our last newsletter we referenced a book, Prisoners of Geography, that we feel gives a good explanation of the historical and geographic factors that set the stage for Russia’s invasion of the Ukraine without any of the emotion or sensationalism that has crept into the current news coverage.

Another good resource is the podcast, “Why it Matters,” which is published by the Council on Foreign Relations. They posted an episode on March 2, 2022, titled Perspective on Ukraine, with Richard Hass. The episode is a good summary of the current situation in Ukraine from a US foreign policy perspective.

Chase Armer's book- Financial Planning Insights is now available at:

store.bookbaby.com/book/financial-…anning-insights

www.amazon.com/Financial-Plannin…1586894022&sr=8-1

To subscribe to the Personal Finance Review (the written form of all the content we discuss on the podcast) please e-mail [email protected]

The Personal Finance Review is published and distributed on a biweekly basis by Planned Solutions, Inc. for informational purposes only. Please seek the advice of a qualified financial planner before taking any action.

Planned Solutions, Inc.

ADDRESS: PHONE:

1130 Iron Point Road, Suite 170 (916) 361-0100

Folsom, CA 95630 (800) 750-2111

E-MAIL: FAX:

[email protected] (916) 361-0191

WEB SITE:

www.PlannedSolutions.com

#finance #invest #investment #stocks #inflation #deflation #bonds

On this episode of the Planned Solutions Incorporated Podcast, Many large mutual funds distributed large capital gains in 2021, which has created a tax headache for shareholders who own those investments in taxable (non-retirement) accounts. These distributions are often very frustrating as they differ from year to year and can be challenging, if not impossible, to anticipate ahead of time. Fortunately, there are a number of strategies that investors can use to manage this issue, including favoring Exchange Traded Funds (ETFs), over mutual funds for increased tax efficiency

Also, Most economists expected that the US inflation rate would decrease during the Spring and Summer months. This was largely based on an expectation that the year-over-year increase in oil prices would decrease as the higher prices in the Spring and Summer 2021 are factored in. However, Russia’s invasion of Ukraine and the resulting spike in oil prices now makes it more likely that high inflation rates will persist.

And, The expanded unemployment benefits offered under the economic stimulus bills in 2020 and 2021 made many dependent children eligible to receive unemployment benefits. This has created an issue in some cases because unlike earnings from a job, unemployment benefits are considered unearned income and therefore may be subject to the Kiddie Tax. Under the Kiddie Tax rules, unearned income may not only be taxable but the amount that exceeds certain thresholds may be taxed at the parent’s highest tax rate.

Plus a look at the Planned Solutions Incorporated Office Bulletin Board- Russia’s invasion of Ukraine has many of us asking questions about how this could happen. What are Russia’s motivations? How has history and economics defined the relationship between Ukraine, Russia, and the West? What are the implications for the future? Most of the current media coverage is influenced by current events or the bias of the media outlets. This has caused many clients to ask us how they can get unbiased information and context in order to better understand the current situation and how it may be resolved.

Several years ago, I read a book called Prisoners of Geography which explains how geography has shaped many of the conflicts around the globe. It so happens that the first chapter is on Russia with an emphasis on its relations with its Eastern European neighbors. I strongly recommend the book as an unbiased source of information that is not influenced by current events but rather takes a very long-term, objective view of the conflict. It also shows that many who study geopolitics could see this conflict coming many years in advance, and yet the leaders of Russia, Ukraine, and the West were, unfortunately, unable to avoid armed conflict by ignoring the lessons of history and geography.

Chase Armer's book- Financial Planning Insights is now available at:

store.bookbaby.com/book/financial-…anning-insights

www.amazon.com/Financial-Plannin…1586894022&sr=8-1

To subscribe to the Personal Finance Review (the written form of all the content we discuss on the podcast) please e-mail [email protected]

The Personal Finance Review is published and distributed on a biweekly basis by Planned Solutions, Inc. for informational purposes only. Please seek the advice of a qualified financial planner before taking any action.

Planned Solutions, Inc.

ADDRESS: PHONE:

1130 Iron Point Road, Suite 170 (916) 361-0100

Folsom, CA 95630 (800) 750-2111

E-MAIL: FAX:

[email protected] (916) 361-0191

WEB SITE:

www.PlannedSolutions.com

#finance #invest #investment #stocks #inflation #deflation #bonds

On this episode of the Planned Solutions Incorporated Podcast, The risk of increased regulation, especially on US technology companies, has largely taken a backseat to other financial risks. This is even as China’s regulatory crackdown on their large technology companies caused their stock prices to drop in 2021 and European regulation has hindered growth in the sector for years. Now the US is becoming more and more active in seeking to rein in the power of its large technology companies, which should not only be a concern for investors but also has the potential to reduce innovation and slow economic growth.

Also, Stock prices have fluctuated so far in 2022 as the long-expected market correction (decline of 10% or more from the previous high) finally occurred in January. However, the fourth quarter earnings season continues to show strong growth in company earnings reports which may be a good sign for stock performance over the longer-term after the current market volatility subsides.

And, January retail sales show strong growth in consumer spending even as inflation pushes prices up. This data continues to support the argument that the reopening of the economy in the Spring of 2021 caused a sharp adjustment in retail spending patterns as spending on gasoline and clothing, which were depressed during the pandemic, recovered the most over the past year. Gasoline prices especially have been a large contributor to inflation, but the increased prices appear to have little impact on consumer gasoline purchases so far.

Plus a look at the Planned Solutions Incorporated Office Bulletin Board- What will they think of next? We all know the dangers of Phishing when it comes to email (never reply to an e-mail with personal information or click on links included in an email unless you have confirmed that they are valid) but now you can be SMShed!

SMShed (SMS texting from an unknown number) is the same thing as a phishing email, but via text message instead. Usually these come from an unrecognized number, and you should treat them suspiciously just like you would an email from an unknown person – generally by deleting without clicking on anything.

Please remember that you will not receive a text message from us directly regarding your accounts. If you do receive a text message from someone at our firm or from your custodian (Charles Schwab, American Funds, etc.) that is unsolicited, please notify us immediately. You can also call Schwab Alliance directly at 800-515-2157 if you have any concerns about the security of your account – they can add additional security such as (1) voice recognition or (2) a verbal password.

Chase Armer's book- Financial Planning Insights is now available at:

store.bookbaby.com/book/financial-…anning-insights

www.amazon.com/Financial-Plannin…1586894022&sr=8-1

To subscribe to the Personal Finance Review (the written form of all the content we discuss on the podcast) please e-mail [email protected]

The Personal Finance Review is published and distributed on a biweekly basis by Planned Solutions, Inc. for informational purposes only. Please seek the advice of a qualified financial planner before taking any action.

Planned Solutions, Inc.

ADDRESS: PHONE:

1130 Iron Point Road, Suite 170 (916) 361-0100

Folsom, CA 95630 (800) 750-2111

E-MAIL: FAX:

[email protected] (916) 361-0191

WEB SITE:

www.PlannedSolutions.com

#finance #invest #investment #stocks #inflation #deflation #bonds

On this episode of the Planned Solutions Incorporated Podcast, Interest rates have been rising which has some investors concerned that higher borrowing costs may hamper the pace of economic growth. However, the shape of the yield curve (longer-term interest rates rising faster than shorter-term interest rates) continues to signal strong economic growth in the future. Accordingly, the Federal Reserve Recession Indicator, which uses the yield curve to estimate the future pace of economic growth and the risk of a recession in the future, is currently signaling a less than 5% chance of a recession within the next year.

Also, The supply and demand for housing now seem to be in equilibrium, meaning the market is currently not oversupplied or undersupplied. This will likely lead to a cooling in housing prices as the homebuilder industry is able to meet the demand for new housing units. In addition, it is unlikely to lead to a sharp decline in housing prices as demand will likely remain strong enough to absorb the new supply.

And, Restricted Stock Units (RSUs) are a form of employee compensation that often creates some confusion around tax reporting. RSUs are not taxable when granted but rather trigger taxation when they vest. In addition, many employees sell a portion of the shares granted at vesting to cover the required tax withholding. These sales trigger a tax reporting obligation that needs to be reflected on the employee’s tax return. Therefore, it is important to track these transactions and make sure they are properly reported.

Plus a look at the Planned Solutions Incorporated Office Bulletin Board- The IRS recently announced that it mailed incorrect statements to some taxpayers who claimed the advanced child tax credit in 2021. The IRS has not stated how many of the 36 million families that received advanced payments have been mailed incorrect statements so it is unknown whether this issue will be widespread or limited to a smaller subgroup.

Tax season has technically opened as the IRS is now accepting e-filed tax returns. However, several federal and state tax forms have not yet been finalized. Therefore, not everyone will be able to file their tax returns early depending on which forms are

Chase Armer's book- Financial Planning Insights is now available at:

store.bookbaby.com/book/financial-…anning-insights

www.amazon.com/Financial-Plannin…1586894022&sr=8-1

To subscribe to the Personal Finance Review (the written form of all the content we discuss on the podcast) please e-mail [email protected]

The Personal Finance Review is published and distributed on a biweekly basis by Planned Solutions, Inc. for informational purposes only. Please seek the advice of a qualified financial planner before taking any action.

Planned Solutions, Inc.

ADDRESS: PHONE:

1130 Iron Point Road, Suite 170 (916) 361-0100

Folsom, CA 95630 (800) 750-2111

E-MAIL: FAX:

[email protected] (916) 361-0191

WEB SITE:

www.PlannedSolutions.com

#finance #invest #investment #stocks #inflation #deflation #bonds

On this episode of the Planned Solutions Incorporated Podcast, The US stock market has declined more than 10% to start the year. This officially puts the market in correction territory (a 10% or greater decline from previous highs) but is still well above bear market territory (a decline of 20% of more from previous highs). Stock market corrections are quite common and more often than not do not progress to a bear market. Therefore, investors should be careful about changing their risk level during these declines and instead focus on how their portfolios can be adjusted to take advantage of these declines.

Also, The Federal Government has updated the life expectancies used to calculate Required Minimum Distributions (RMDs). The changes reflect the increase in life expectancies that has occurred in recent decades. For most ages this will reduce the percentage that tax-deferred retirement account holders are required to take each year, however in some cases, there may be no change or could even be a small percentage increase.

And, Taxpayers who received the Advanced Child Tax Credit during 2021 will be required to reconcile, or true-up, their payments with the IRS when they file their tax returns. In order to complete the required calculations, the taxpayer will need a copy of IRS Letter 6419 which will report the amount that the IRS paid on behalf of the taxpayers. Taxpayers should also be aware that the credit may need to be repaid if the status of their dependent(s) changed or the taxpayer’s income increased to the point where the credit is phased out.

Plus a look at the Planned Solutions Incorporated Office Bulletin Board- Taxpayers will be able to EFILE their federal tax returns starting Monday, January 24, 2022. While we always encourage filing an accurate and timely return, this year it is even more important to take the time to ensure you’ve gathered all the necessary information before submitting your return because of IRS delays due to limited resources and a backlog of tax returns. Therefore, any discrepancies may delay the processing of your potential refund, and should you need to amend your return you may be waiting much longer than the standard processing time.

Chase Armer's book- Financial Planning Insights is now available at:

store.bookbaby.com/book/financial-…anning-insights

www.amazon.com/Financial-Plannin…1586894022&sr=8-1

To subscribe to the Personal Finance Review (the written form of all the content we discuss on the podcast) please e-mail [email protected]

The Personal Finance Review is published and distributed on a biweekly basis by Planned Solutions, Inc. for informational purposes only. Please seek the advice of a qualified financial planner before taking any action.

Planned Solutions, Inc.

ADDRESS: PHONE:

1130 Iron Point Road, Suite 170 (916) 361-0100

Folsom, CA 95630 (800) 750-2111

E-MAIL: FAX:

[email protected] (916) 361-0191

WEB SITE:

www.PlannedSolutions.com

#finance #invest #investment #stocks #inflation #deflation #bonds

On this episode of the Planned Solutions Incorporated Podcast, The stock market has stumbled to start the year. However, digging deeper into the returns it appears that a major shift in market leadership may be occurring. Growth stocks have started the year in the red, led by a sharp decline in technology stocks. Meanwhile, value stocks have posted gains led by a sharp increase in the value of financial stocks. The cause appears to be an increase in interest rates, which typically hurts the valuations of growth stocks while benefiting financials, which may experience increased profits in a rising interest rate environment.

Also, It is increasingly common for investors to lose track of small retirement accounts. One reason for this is that employers may transfer small 401k account balances to IRAs rather than leaving the money invested in the plan. This can complicate financial planning strategies and even change the investment strategy to an IRA default option rather than the investment strategy selected by the plan participant.

And, Buy Now Pay Later programs have become popular with consumers as well as retailers. Retailers like it because it allows them to offer quick access to credit to customers to capture additional sales. Customers like it because these loans can be secured quickly with little or no underwriting. However, it is important that consumers be careful in taking on too much debt or missing payments which may adversely impact their credit score. Often the best practice is to save before buying rather than using short-term credit.

Plus a look at the Planned Solutions Incorporated Office Bulletin Board- Before preparing your 2021 income tax return(s) it is important to make sure that you have all of the tax forms and other tax information that you need. In some cases, this may mean being patient until all of your investment forms have been issued. This year it is once again especially important to account for the Economic Impact Payments (EIP) that were sent out to most taxpayers in early 2021 as well as any advanced child tax credit received.

Chase Armer's book- Financial Planning Insights is now available at:

store.bookbaby.com/book/financial-…anning-insights

www.amazon.com/Financial-Plannin…1586894022&sr=8-1

To subscribe to the Personal Finance Review (the written form of all the content we discuss on the podcast) please e-mail [email protected]

The Personal Finance Review is published and distributed on a biweekly basis by Planned Solutions, Inc. for informational purposes only. Please seek the advice of a qualified financial planner before taking any action.

Planned Solutions, Inc.

ADDRESS: PHONE:

1130 Iron Point Road, Suite 170 (916) 361-0100

Folsom, CA 95630 (800) 750-2111

E-MAIL: FAX:

[email protected] (916) 361-0191

WEB SITE:

www.PlannedSolutions.com

#finance #invest #investment #stocks #inflation #deflation #bonds

On this episode of the Planned Solutions Incorporated Podcast, The headline inflation rate for the 12 months ending in November was 6.8%, the highest since the 1970s. However, not all goods and services prices increased at the same rate. Energy alone made up 2.5% of the headline inflation rate while food added 0.85%, and vehicle prices added an additional 1.6%. Therefore, just three categories accounted for nearly 5% in inflation whereas most other categories increased at rates that we in line with or slightly above their long-term average.

Also, The personal residence exemption allows a single homeowner to exclude up to $250,000 and married couples to exclude up to $500,000 in gain from the sale of a personal residence and is often under-utilized. Homeowners with gains on their homes that start to exceed the amount of gain that can be excluded may want to consider selling their home to take advantage of the tax benefits and start the gain over on a new home.

And, For taxpayers over age 72, Required Minimum Distributions add a layer of complexity to managing their retirement accounts. This is especially true if the taxpayer is still working as the RMD rules for their employer’s retirement plan may be different than they are for other retirement plans. Therefore, it is important for taxpayers to manage their RMDs and where appropriate possibly implement strategies to reduce or simplify the administration of their RMDs.

Plus a look at the Planned Solutions Incorporated Office Bulletin Board- As a reminder, the new higher contribution limits for retirement accounts will be implemented at the start of 2022. The new 401k contribution limit will increase to $20,500 for savers under age 50 and $27,000 for those age 50 and older. This increase will also apply to 403b and 457 retirement plans. If your goal is to maximize your retirement contributions through equal periodic payroll deductions you may need to increase your contribution election before your first paycheck of 2022 is issued.

Chase Armer's book- Financial Planning Insights is now available at:

store.bookbaby.com/book/financial-…anning-insights

www.amazon.com/Financial-Plannin…1586894022&sr=8-1

To subscribe to the Personal Finance Review (the written form of all the content we discuss on the podcast) please e-mail [email protected]

The Personal Finance Review is published and distributed on a biweekly basis by Planned Solutions, Inc. for informational purposes only. Please seek the advice of a qualified financial planner before taking any action.

Planned Solutions, Inc.

ADDRESS: PHONE:

1130 Iron Point Road, Suite 170 (916) 361-0100

Folsom, CA 95630 (800) 750-2111

E-MAIL: FAX:

[email protected] (916) 361-0191

WEB SITE:

www.PlannedSolutions.com

#finance #invest #investment #stocks #inflation #deflation #bonds

On this episode of the Planned Solutions Incorporated Podcast, It remains to be seen whether the recent bout of high inflation will persist longer-term. However, should inflation remain elevated, it is important to understand the impact that it may have on stock prices. This includes the potential for high inflation to lead to an increase in interest rates, which will likely have negative implications for growth stocks, while value stocks and high-dividend stocks may benefit from such an environment.

Also, Two of the last pandemic related stimulus programs are scheduled to end in the next couple of months. The expanded child tax credit payments that some households are receiving monthly in advance are scheduled to end on December 31, 2021. Also, the moratorium on federal student loan payments and the suspension of interest payments on those loans are scheduled to end in February 2022.

And, Year-end tax planning often involves tax-loss harvesting in which investors sell investments that have a tax loss to capture the tax benefit for the current or future tax years. However, in some years tax-gain harvesting may also be advisable, especially when taxpayers can use past losses to offset the gain, will avoid taxes on the gain due to low income for the tax year, or expect income tax rates on capital gains to increase in future years.

Plus a look at the Planned Solutions Incorporated Office Bulletin Board- The 2021 SmartVault files have been created; this can be a good place to store any donation receipts, car registrations taxes, property tax payments, estimated tax payments, etc. while we wait for the tax season to begin.

Chase is once again contributing to the Sacramento Business Review (SBR) January economic update event. The SBR is a collaboration between members of the Sacramento Chartered Financial Analysts (CFA) Society and the Sacramento State University School of Business.

Chase Armer's book- Financial Planning Insights is now available at:

store.bookbaby.com/book/financial-…anning-insights

www.amazon.com/Financial-Plannin…1586894022&sr=8-1

To subscribe to the Personal Finance Review (the written form of all the content we discuss on the podcast) please e-mail [email protected]

The Personal Finance Review is published and distributed on a biweekly basis by Planned Solutions, Inc. for informational purposes only. Please seek the advice of a qualified financial planner before taking any action.

Planned Solutions, Inc.

ADDRESS: PHONE:

1130 Iron Point Road, Suite 170 (916) 361-0100

Folsom, CA 95630 (800) 750-2111

E-MAIL: FAX:

[email protected] (916) 361-0191

WEB SITE:

www.PlannedSolutions.com

#finance #invest #investment #stocks #inflation #deflation #bonds

On this episode of the Planned Solutions Incorporated Podcast, After 18 months of volatility the Federal Reserve Senior Loan Officer Survey appears to be signaling a normalization in the market for loans. Lenders tightened lending standards for both consumer and business loans in 2020 but are now loosening those standards to encourage more borrowers to apply. Meanwhile, demand for mortgage loans increased in 2020 but has since declined while the demand for consumer loans (auto, credit card, and personal loans) has recovered this year.

Also, Many people are leaving corporate life for the freedom and flexibility that may come from being self-employed. However, working as an independent contractor rather than as an employee may come with some additional taxes and expenses. It may also reduce access to a number of common employee benefits which should be taken into consideration.

And, When someone passes after setting up a trust to handle their financial affairs there are a series of actions that are required by law to protect the interests of all parties involved. Therefore, the successor trustee as well as the beneficiaries or other interested parties should be aware of the legal requirements in order to meet their fiduciary duty and protect their rights. This is especially important when there are disagreements about how the trust should be administered.

Plus a look at the Planned Solutions Incorporated Office Bulletin Board- Planned Solutions will soon be sending out our tax engagement letters and organizers in early January. We will also be posting the organizers in SmartVault a few weeks before mailing the organizers.

At Planned Solutions, we have been engaged in training about cyber security.

Chase Armer's book- Financial Planning Insights is now available at:

store.bookbaby.com/book/financial-…anning-insights

www.amazon.com/Financial-Plannin…1586894022&sr=8-1

To subscribe to the Personal Finance Review (the written form of all the content we discuss on the podcast) please e-mail [email protected]

The Personal Finance Review is published and distributed on a biweekly basis by Planned Solutions, Inc. for informational purposes only. Please seek the advice of a qualified financial planner before taking any action.

Planned Solutions, Inc.

ADDRESS: PHONE:

1130 Iron Point Road, Suite 170 (916) 361-0100

Folsom, CA 95630 (800) 750-2111

E-MAIL: FAX:

[email protected] (916) 361-0191

WEB SITE:

www.PlannedSolutions.com

#finance #invest #investment #stocks #inflation #deflation #bonds