Market update, commentary, a recap of the CARES Act 2020 federal stimulus package, and answers to client questions from Tuesday, March 31, 2020 with Joe Anderson, CFP®, President of Pure Financial Advisors, and Pure’s Executive Vice President and Director of Research, Brian Perry, CFP®, CFA.
Download Brian Perry’s full slide presentation.
00:00 – Introduction
02:54 – Market Update
- 03:15 – Many investors follow their emotions – reacting can hurt performance
- 04:55 – S&P 500 Index daily changes
- 05:52 – The market’s response to crisis
07:04 – Portfolio Management Change: a tactical shift in stock trading, temporarily shifting rebalancing bands from 20% to 25%
08:57 – CARES Act:
- 09:19 – Recovery rebates
- 13:09 – Coronavirus-related distributions from retirement accounts
- 14:32 – Benefits of Coronavirus-related distributions
- 16:03 – Enhancements to loans from employer plans
- 16:52 – RMDs waived in 2020
- 20:33 – Charitable deductions
- 21:37 – Unemployment compensation
- 22:38 – Small business provisions
- 24:01 – Student debt relief, healthcare-related rules
Attendee Questions:
25:19 – Remind us how we can get a copy of the slide deck? Download it here.
25:35 – Regarding the 20% or 25% bands: My question is what is done when holdings go outside this range? I assume plus side actions would be different than the minus side.
28:35 – Are retired persons also going to get the pay-out from the stimulus plan?
29:03 – Even though I haven’t paid any federal or state income taxes, will I be eligible for any sort of refund when I file my income tax return?
29:26 – How can RMD tax withholds be recouped on a rollback?
30:12 – As a small business owner, I have cut my employees to 4 hours per day to help us weather the storm. When my employees apply for unemployment they are being told they need to use their vacation time first. If I allow them to use vacation time I don’t save any salary costs. Does this sound accurate?
30:35 – Can you explain again what is meant by the banding, and what the 20 to 25% change means?
31:20 – Is there a provision in the CARES Act allowing the use of 529 plan funds for non-educational purposes?
32:36 – You say ‘another-allocation’: please list your potential allocations
34:25 – If I claimed my 21-year-old daughter who is in college as a dependent, and she has a part-time job and filed her 2019 taxes, will she get the $1200 under the Cares Act?
34:38 – My wife has her own business and is now making like nothing. Can she collect unemployment even though she is a sole proprietor?
34:59 – How can a typical account benefit from tax-loss harvesting?
38:09 – So if I receive my $1200 rebate this year and in the year 2020 I have no tax liability, I do not have to pay back the $1200?
38:19 – We had our taxes completed two weeks ago by our CPA. We have not e-filed yet, should we have the CPA re-run the preparation given the new information/guidance in CARES Act?
39:14 – If taking out up to $100,000 from IRA will not have fees applied to them, is that a taxable action? I’m thinking I would like to do Roth IRA conversions.
42:04 – With the volatility in the market, are you buying/selling more frequently?
42:10 – I understand with the bands expanded, it allows it to ‘run’. Doesn’t that allow it to run BOTH ways? Higher and lower?
42:49 – Hi, I’m an independent musician set up as a sole proprietor on our tax returns. In the past I have never been able to collect CA unemployment benefits. Will I be able to collect under the Federal CARES Act just implemented? Additionally, what about the small business loans that are essentially grants, as they are not requiring them to be paid back?
44:32 – I like to hear your opinion on what will the market be trending in the new few weeks/months?
46:53 – Are the bands the same in taxable and non-taxable/retirement accounts? Why wouldn’t the upside band be larger than 25%?
47:37 – I am interested in taking out a $100k loan from the 403(b) and repay it over 3 years and use the $100k to invest due to the drop. My time horizon is 5 years or longer. Your thoughts?
48:28 – With the salons closed, how is Joe maintaining that sharp hairstyle?
48:45 – What do you think the Padres win/loss record would be right now?
Watch the previous market update webinar (March 24, 2020).
Subscribe to our YouTube channel.
IMPORTANT DISCLOSURES:
• Investment Advisory and Financial Planning Services are offered through Pure Financial Advisors, Inc. A Registered Investment Advisor.
• Pure Financial Advisors Inc. does not offer tax or legal advice. Consult with a tax advisor or attorney regarding specific situations.
• Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
• Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.
• All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy.
• Intended for educational purposes only and are not intended as individualized advice or a guarantee that you will achieve a desired result. Before implementing any strategies discussed you should consult your tax and financial advisors.
