Trending Topics
This Month’s Trending Topics
I Bonds
Over the past few years, some of you purchased I Bonds when the inflation rate was high and these bonds were paying over 7 percent interest. You may have noticed that the interest rates these bonds are now paying is much lower as inflation has moved back below 3 percent. Bonds being purchased today are paying an annualized rate of 3.11 percent, which is much lower than a few years ago and lower than most high yield savings and CD rates.
Depending how long you have held the bonds and your goals for the money, it might be a time to consider cashing out. However, there are impacts to cashing out that you should consider before doing so.
- If the bond is less than 5 years old, you will lose the last three months of interest
- You will owe tax on any interest earned on the bond
- If inflation were to go back up, these bonds could become attractive once again
Please reach out if you own I Bonds and want to discuss your options.
Money Transfers
We want to ensure we are getting your money to you as quickly, efficiently and safely as possible. Some items which are extremely helpful for us to ensure this happens:
- If you change bank accounts and the account was linked to your Osaic account, please let us know so we can update with the new account information. It takes a few days to link a new account and any attempt to transfer funds to a closed account will result in a rejected transfer which will take a few days to get the funds back into your Osaic account.
- If you request a transfer out of your account, Osaic’s back office may give you a call to verity the request. If you receive a call from Osaic after requesting funds be sent out of your account, be sure to call them back as they will not send the funds until they receive a verbal verification from you.
- If you have a checkbook linked to your Osaic account, try to use a consistent signature when signing. Osaic’s back office is very careful when paying out checks and will call for verification when your signature isn’t a match to what they have on file.
- Be sure to let us know if you are going to write checks against your Osaic account so we can ensure there is sufficient cash to cover the check.
- Please let us know as soon as you know money will be needed as it takes a few days to get the funds freed up and transferred. Be aware that Osaic does not allow third party wires, unless it’s to a title company for a home purchase.
Changes/Fear
With a new administration taking over in Washington, there have been some concerns expressed to us about what could happen and potential worst-case scenarios that some of you may be hearing or reading. While we understand the concerns and there may be some changes that negatively impact the country or markets, we want to point out that there were concerns four years ago, 8 years ago, essentially every time a new administration takes over.
While this time may be different and some of the concerns may be valid, our country has always gotten through it and moved forward. A couple of pieces of advice when you read or hear about something catastrophic that is predicted to happen.
- Try to remember a time when you read or heard something about a potential catastrophic event with the economy, banks or the market that was going to happen, you acted on it, and then, with the benefit of hindsight, you were glad you did.
- When you hear about something catastrophic that is going to happen, find the source of the information. How do they know this is going to happen? Where did they get their information? What is their motivation in providing you with this information? Has anyone actually proposed legislation to enact what they are predicting?
- Think about all the financial networks, websites and blogs out there that need to fill 24 hours of airtime, screen time and sell ads. The more extreme the information, the more likely you are to watch it or click on it. When was the last time you clicked on something because it was positive and made you feel good?
Sure, every once in a while, there is someone who makes a bold prediction which turns out to be useful. But you typically have to wade through a lot of garbage to get it. And if things really do turn out to be as bad as the worst-case scenarios, will putting all your money in gold or cash really save you if the entire system has collapsed?
We understand the fear that can come with change and the unknown. We understand the stress of watching your portfolio value drop, especially when you are in a stage in life when you are dependent on it for income. But what if, rather than obsessing on the unknown and these potential one-off scenarios which have virtually no chance of happening, you try to focus on what you can control, and the things that are truly important to you. And when someone tells you things are about to fall apart, ask them where they are getting this information and why you should believe it is credible.
Try to maintain a positive mindset, no matter how bad the headlines may make things seem. But if the unknown is keeping you up at night, please reach out so we can talk about how to design a strategy to get you back to sleep. We are here to help in any way we can, so don’t hesitate to reach out if there is something on your mind.
This material is meant for general illustration and/or informational purposes only. Views expressed in this newsletter may not reflect the views of Osaic Wealth, Inc. It is our goal to help investors by identifying changing market conditions. However, investors should be aware that no financial advisor can accurately predict all of the changes that may occur in the market. This material should not be relied upon as investment advice. Investors should note that there are risks inherent in all investments, such as fluctuations in investment principal. There is no guarantee that a diversified portfolio will outperform a non-diversified portfolio in any given market environment. This article contains forward looking statements and projections. Past performance is no guarantee of future results. Neither Osaic Wealth, Inc. nor its representatives provide tax or legal advice. If you don’t wish to receive marketing emails from this sender, please reply to this email with the word REMOVE in the subject line.