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About Allison Rumschik

Rumschik2018

The Low Down on Retirement Accounts 2025

Hello from Sycamore,

If you are 73 and haven’t taken your Required Minimum Distribution (RMD) for the 2024 tax year, you will likely need to by April 1, 2025.

What is an RMD?

An RMD is the minimum distribution you must withdraw from your retirement account each year.

When do I have to begin taking RMDs?

You must begin taking your RMDs by April 1st of the year following the calendar year in which you reach age 73. What does this mean?

  1. Example: Your 73rd birthday was any time in 2024. As long as you will reach age 73 by December 31, 2024, you must take your first RMD (for 2024) by April 1, 2025.

Then each year after this you must take your RMD by December 31 of that year.

Can I take more than my RMD amount?

You can withdraw more than the minimum amount required. The total amount you withdraw will be included in your taxable income.

Can I take withdrawals before 73?

Yes. Once you reach 59 ½ you may take withdrawals with no early withdrawal penalty. You will still be responsible for regular income tax on the complete amount withdrawn.

You may also withdraw funds prior to age 59 ½ however, you will likely need to pay an extra 10% early withdrawal penalty in addition to the regular income tax.

Highlights for 2025

Retirement Savings Plan Contribution Limits have changed.

  1. 401(k), 403(b), 457 plans, and federal government Thrift Savings Plan contribution limits are $23,500.
    1. Catch-up contributions for those over age 50 remain at $7,500.
    2. Catch-up contributions for those aged 60-63 remain at $11,250
  2. IRA contribution limits remain at $7,000.
    1. Catch-up contributions for those over age 50 remain at $1,000.
  3. SIMPLE IRA contribution limits $16,500.
    1. Catch-up contributions for those over age 50 are $3,500.
    2. Catch-up contributions for those aged 60-63 are $5,250
  4. SEP IRA contribution limit is $70,000 in 2025.
  5. The Health Savings Account (HSA) contribution limit for single people in 2025 is $4,300 and for family coverage is $8,550
  6. Qualified Charitable Distribution’s annual limit for 2025 is $108,000.

As always, do not hesitate to reach out to our offices at (765) 455-1554 to discuss this.

Thank you for your continued trust and support,

Sycamore Financial Group

*Past performance does not assure future results. Investors cannot invest directly in the stock market indexes such as the S&P 500. Investment return and principal value of an investment will fluctuate. Investor value, when sold may be worth more or less than their original cost.

By |2024-12-19T00:00:43-05:00December 19th, 2024|2024 Newsletters|0 Comments

Timing the Market vs. Time in the Market

Hello from Sycamore,

Have you considered changing your investment strategy based on some event that you believe will happen with the idea of changing back after the event? I can think of some questions leading up to this most recent election that we fielded. On Wednesday, as we watched the market climb about 3%, we thought it would be a good reminder that time in the market is more important than timing the market. We believe staying the course is typically the best course of action. The decision you make when emotions are not involved tends to be the best decision in the long run. To illustrate this, we located a graph showing if you were to invest in the S&P 500 for a 20-year time period (1/1/2004- 12/29/2023) and how missing some of the best days in the market could impact your returns.

Impact Of Time Out Of The Market
Impact Of Time Out Of The Market

Table Source: JP Morgan Asset Management. The dollar amount shows the performance of a $10,000 investment between Jan. 1, 2004, and Dec. 29, 2023. Returns are based on the S&P 500 Total Return Index. Indices do not include fees or operating expenses and are not available for investment. The hypothetical performance calculations are shown for illustrative purposes only and are not meant to be representative of actual results while investing over the periods shown. Calculations are gross of fees but include reinvested dividends. Hypothetical performance does not reflect actual trading, liquidity constraints, fees, and other costs and may not account for the impact of certain market factors such as lack of liquidity. Simulated trading programs are designed with the benefit of hindsight. Returns will fluctuate and an investment upon redemption may be worth more or less than its original value. Past performance is not indicative of future results.

We now pose a question to you – how would you know when the time was right to sell or buy? Is it worth it to potentially cut your returns in half if you are wrong? We believe that generally you should stay the course and trust the process.

Thank you for your continued trust and support,

Sycamore Financial Group

*Data not audited
**Past performance does not assure future results.  Investors cannot invest directly in the stock market indexes such as the S&P 500.  Investment return and principal value of an investment will fluctuate.  Investor value, when sold may be worth more or less than their original cost.
***This article is distributed for general informational and educational purposes and is not intended to constitute legal, tax, accounting, or investment advice.***

By |2024-12-19T00:03:03-05:00November 9th, 2024|2024 Newsletters|0 Comments

2024 First Quarter Market Commentary

Hello from Sycamore,

Performance and the Markets

We are pleased to report that the first quarter was a bonus quarter with our composite gaining more than 7%. This is about three times the normal gain that we would expect so we’re pleased. While we do expect your account(s) to gain more before the year-end, we doubt that the current pace will be sustained. There’s plenty of good news on the economic front, and as you know we believe – in the long run – share prices and your account(s) value will follow the profitability of the companies you hold. There’s much that we cannot control but we can control the quality of the companies in your account(s), and that is where we put our efforts. Obviously, we want as much growth as possible but only if the risk is not too large. Maximizing growth is important, but not as important as controlling risk.

Does anyone remember early 2022 when many were expecting increasing interest rates to spark a recession? Hasn’t happened yet! Our economy continues to be stronger and more resilient than expected. If inflation moves lower, we expect interest rates to decline later this year. Lower interest rates could provide a boost for the overall economy and share prices.

The Magnificent Seven (Microsoft, Alphabet, Amazon, Apple, Meta, Nvidia, and Tesla) are still on a roll. As a group, they gained more than 100% and accounted for about 50% of the S&P 500 gain last year. As we have reported before, they now represent about 30% of the S&P 500 index. Maybe they’ll go up at this rate forever! Maybe this time it really is different! Maybe!

The Economy

From our perspective, the economy is solid. Inflation has been a bit more stubborn than we would like, but it’s better than one year ago. The current rate is about 3.5% which is a nice reduction from the roughly 9% peak in mid-2022 and…Producer Prices continue to decline. The Federal Reserve Bank of Atlanta now expects our economy to grow at a respectable rate of 2.4% for the first quarter of 2024. Unemployment continues to be historically low at less than 4%, which is better than our long-term average. The Bureau of Labor Statistics reported that we created more than 300,000 new jobs in March alone.

We are not saying everything is perfect, it rarely (if ever) is. For instance, commercial real estate values have declined somewhat over the past year or so, and new home sales could be better. We are saying that the economic underpinnings appear to be in place to support growth for both our economy and the companies that we have placed into your portfolio(s). In the long run, betting against the U.S. economy and everyone who runs a business, has been a poor bet. We remain optimistic.

Managed portfolio purchase and sale activity during quarter 1
Sales: Sally Beauty, Sirius XM Holdings, and Hexcel.
Buys: Dentsply Sirona, MGP Ingredients, UGI Group, and Malibu Boats.

As always, do not hesitate to reach out to our offices at (765) 455-1554 to discuss this.

Thank you for your continued trust and support,

Sycamore Financial Group

***This article is distributed for general informational and educational purposes and is not intended to constitute legal, tax, accounting, or investment advice.***

By |2024-04-30T04:00:21-04:00April 30th, 2024|2024 Newsletters|0 Comments

2023 Fourth Quarter Market Commentary

Hello from Sycamore,

2023 is now in the books and this year was special for us because it marked completing 40 years for Sycamore. We want you to know how grateful we are to have had this 40-year run and how fortunate we feel to be able to work with all of you.

We are aware that without your business, Sycamore would not exist. A good number of you have been with us since the beginning and many of you worked with me back in the 70’s. They say that time flies when you’re having fun. Without any doubt, this has been fun and we’re just getting started.

I also want to thank Anita (37 years), Karen (38 years), Kathy (19 years), Brent, and Allison (7 years each) for being the best in class. None of this would work without them, and their value to our company cannot be overstated.

Additionally, we’re happy to report that the markets turned 180 degrees from 2022 and we had nice gains for most portfolios for 2023. We’re looking forward to 2024.

All in, what could be better?

We realize that we are very fortunate, and I personally want to thank each of you again for your business and trust.

Performance and the Markets

As we stated above, the markets reversed course from the decline we had in 2022, recovering more than the amount lost last year. Over the past few years, share prices have remained about the same while, at the same time, most companies that we track have continued to show earnings gains. The longer this goes on the more confident we become that share prices will increase from current levels.

You may have noticed that your portfolio has not tracked closely to the S&P 500 index that we use as our ‘market’ yardstick. The S&P 500 is experiencing a phenomenon as just a few stocks – known as the magnificent 7 – now represent about 30% of the index. These stocks are Apple, Microsoft, Nvidia, Alphabet, Tesla, Meta, and Amazon. Through your account at Sycamore, you likely own some of these stocks, but they do not represent 30% of your equity holdings. It’s the “unexpected” that can cause problems with your portfolio, and we are not about to take large risks with your money. Many of you will remember that we experienced a similar divergence in the late 90s during the Tech bubble. In some ways, it’s different this time, but it’s really not different this time.

The Economy – Remember that we want the economic data to be boring!

The economy continues to do well but we’re not expecting a repeat of the growth (near 5% annualized) that we had in the third quarter of 2023. The Atlanta Federal Reserve Bank has reported that our economy grew at a respectable annualized rate of 3.3% during the 4th quarter of 2023. Our economy continues to produce new jobs – about 2.7 million in 2023 – and the unemployment rate remains historically low at about 3.7%. Per capita Real Disposable Personal Income now stands at about $50,000. Just before COVID-19, that number was about $48,000. We are continuing to make progress. The Federal Reserve Bank has been raising interest rates for about a year and it seems to be having the desired effect on inflation which has dropped from about 6% at the beginning of 2023 to about 3.5% by year end. It usually takes about 12-18 months for the effect of an interest rate increase to show fully so we’re expecting the effect of the interest rate increases to be more evident in the next 6 months. We expect that these rate increases will continue to slow the rate of inflation and before long, we expect the Federal Reserve Bank to reduce interest rates.

Purchase and Sale Activity During Q-4

Sales: Kelly Services, Petmed Express, Embecta, Kyndryl, Bell Ring, Post Holdings, Kellogg, Kelonova, Tupperware and Sandoz Group.
Buys: International Flavors and Fragrances.

As always, do not hesitate to reach out to our offices at (765) 455-1554 to discuss this.

Thank you for your continued trust and support,

Sycamore Financial Group

***This article is distributed for general informational and educational purposes and is not intended to constitute legal, tax, accounting, or investment advice.***

By |2024-01-26T17:30:13-05:00January 26th, 2024|2024 Newsletters|0 Comments

2024 Contribution Limit Changes

Hello from Sycamore,

Did you Know?

For the 2024 tax year, some contribution limits have increased.

  • 401(k), 403(b), & 457 account contribution limits are now $23,000 for the year.
    • There is a $7,500 catch-up if you will turn 50 in 2024.
  • Traditional and Roth IRA annual contribution limits are now $7,000.
    • There is a $1,000 catch-up if you will turn 50 in 2024.
  • SIMPLE IRA contribution limits are now $16,000.
    • There is a $3,500 catch-up if you will turn 50 in 2024.
  • Health savings account limits are now $4,150 for individuals and $8,300 for families.
    • There is a $1,000 catch-up if you will turn 55 in 2024.
  • The annual gift tax exclusion for 2024 is $18,000 per person.
  • The annual qualified charitable distribution (QCD) limits are now $105,000.

As always, do not hesitate to reach out to our offices at (765) 455-1554 to discuss this.

Thank you for your continued trust and support,

Sycamore Financial Group

***This article is distributed for general informational and educational purposes and is not intended to constitute legal, tax, accounting, or investment advice.***

By |2023-12-15T03:09:17-05:00December 15th, 2023|2023 Newsletters|0 Comments

Third Quarter Commentary 2023

Hello from Sycamore,

Performance and the Markets

It seems like there is always plenty to worry about and this year is no exception. Considering the political environment and the calls for a recession over the past year or so, there is plenty to be concerned about. However, as we think back over the years, there has always been enough to be concerned about, but how many of the things we worried about came to fruition? I think you’ll agree that the answer to that question is very few. According to researchers at Penn State University, only about 8% of the things people worry about come true. From our perspective, what we have today is simply more of ‘the normal’. Share prices and most markets have been declining a bit for the last month or so, but this is not unusual. We’re at about the same level now as we were at the 1st of 2023 and for practical purposes, ad the market has been relatively quiet for almost 2 years.

The economy and the consumer are still strong. The Federal Reserve Bank of Atlanta’s GDPNow estimate for the 3rd quarter of 2023 is +4.9%. This number is a good argument against a recession anytime soon. If a recession does appear, we feel it will likely be mild and after the roughly 25% decline in the S&P about 1 year ago, we feel the markets have already priced it in. Some sectors – especially tech – are a bit overvalued, but overall, we see the market as being ‘fairly’ priced. By the way, we’ve just had ten years of very good share value increases, and we do not expect those ‘outsized’ returns to continue. We look for more modest gains over the next few years. Fixed investments are now certainly paying more than they have since before The Great Recession, but we also have higher inflation, so they are just keeping up. We remain optimistic over the long haul. As we do our research looking for bargains, we are having no trouble finding good value.

The Economy

The economy appears healthy. As we mentioned above, The Federal Reserve Bank of Atlanta’s GDPNow estimate for the 3rd quarter of 2023 is +4.9%. There are still some who feel we will have a recession, but those voices are fading a bit and their predictions have been tempered. It is true that the Fed has been raising interest rates though the rate of increase has slowed considerably this year. Higher interest rates should tamp down inflation and we’re already seeing some success with this. Additionally, the money supply, M-2 is declining. This is unfamiliar territory so time will tell, but we believe this is good and necessary after the cash infusion we had during COVID-19. While all this has been happening, the economy is continuing to do reasonably well. Unemployment is at historical lows, new home sales, which had declined significantly from their 2020 highs have started to trend higher during 2023. Disposable personal income is growing, new orders for durable goods are trending higher, and Inflation – which peaked in mid-2022 at an annualized rate of about 9% – has now dropped to around 5%. Things aren’t perfect, they never are, but overall, there is plenty to be positive about.

Purchase and Sale Activity During Q-3

We bought MDU Resources – MDU, ASGN Inc- ASGN, Forward Air – FWRD and AMC – AMCX

We sold Flour Corp – FLR, Kenvue – KVUE, and Knife River Corp – KNF

We’ve started to shift into longer-term bonds and fixed investments.

Investors and Speculators

Each year we like to remind you of our goals for your portfolio(s). We are pleased to have outperformed the S&P 500 over the last 27 years, but that is not one of our primary goals. Our long-term goals for your portfolio(s) are to deliver reasonably good returns, reduce your overall volatility, and reduce your taxes through lower turnover. Speculators worry about the latest story and today’s market opening direction. Investors purchase good businesses and participate in their growth.

As always, do not hesitate to reach out to our offices at (765) 455-1554 to discuss this.

Thank you for your continued trust and support,

Sycamore Financial Group

*Data not audited
*Results reported gross fees
**Past performance does not assure future results. Investors cannot invest directly in the stock market indexes such as the S&P 500. Investment return and principal value of an investment will fluctuate. Investor value, when sold may be worth more or less than their original cost.

By |2023-10-26T23:48:28-04:00October 26th, 2023|2023 Newsletters|0 Comments

Fourth Quarter 2022 Economic Commentary

Hello from Sycamore,

Performance and the Markets

2022 is now in the books and while it wasn’t one to brag about, we feel that overall, during the last 10 years, the markets have been very good.

The question we’d all like an answer to is how will the markets fare in 2023? The short story is…we’re more optimistic about 2023 than we were about 2022. Before we tell you why let me tell you two things that you already know. One – We cannot predict the future. Two – we’re not market timers. With those thoughts in mind, we’ll be happy to share what we think about the next twelve months.

If you travel back to December 2021, you will remember how optimistic most projections were. The market had just finished a great year. At that time, most investors felt confident and were looking forward to a good 2022. However, we were a bit more cautious. If you look at your annual review follow-up letters we sent you from 2021, you will likely find that we were cautioned against expecting a continuation of the outsized market gains we’d been experiencing. Why? When we conduct our investment analysis, we study the earnings of companies and compare those to the current share price (this is a significant simplification of our research process) to determine if we want to hold that security. In 2022, earnings increased more than expected but not as much as share prices, so we were being cautious. We’ve learned that a strong defense can be as – if not more – important than your offense. What does this have to do with our thoughts about 2023?

During the 3rd quarter of 2022, profits of the 500 companies in the S&P 500 index increased by about 9% vs the 3rd quarter of 2021 (Source; S&P Global Market Intelligence). During this same 12-month period, the average share price of these same stocks declined by about 15%. From our perspective, the relationship between earnings and share prices has improved significantly. We are more optimistic about 2023, but we will continue to invest in your accounts with a strong defense.

Speaking of last year, let’s look at some final numbers. For the year ended 12/31/22, our Growth and Income Composite – gross of fees – declined 6.95% while the S&P 500 declined 18.11%. We are very pleased with our relative performance.

The Economy

First, let’s discuss inflation. For the last year, inflation has been a problem. The Federal Reserve has increased the interest rate over the last year to try to slow the rate of inflation and this seems to be having a positive effect. Additionally, we see that producer prices (commodities like corn and beans for example) have declined from an annualized rate of more than 20% earlier this year, to a more moderate annualized rate of less than 9%, and that decline appears to be continuing. This is good news.

Housing is a significant and weak sector. Interest rates are having a major impact on the sale of existing homes and now they appear to be starting to have a similar impact on new home construction. We expect both declines to moderate as buyers become accustomed to the higher interest rate environment, but in the meantime, housing is likely to be a drag on the economy.

Other economic indicators are in relatively good stead. The sale of automobiles, which have been steady throughout 2022 are beginning to trend higher. Unemployment continues to remain near all-time lows and the economy continues to create new jobs. In December we created more than 200,000 jobs and for the year 2022, we created about 4.5 million jobs. This is the second-highest total ever following the 6.7 million jobs created in 2021. Consumer Confidence, which has been declining slowly since mid-2021, seems to be heading north again.

We could talk about the economic data until your eyes glaze over, but suffice it to say that overall, we are cautiously optimistic about the economy during 2023.

Purchase and sale activity during Q-4

During the 4th quarter of 2022, we were relatively inactive- we bought Alphabet and had no sales.

As always, never hesitate to contact us with any questions or concerns.

Thank you for your continued trust and support,

Sycamore Financial Group

*Data not audited.
**Results reported gross of fees.
***Past performance does not assure future results.  Investors cannot invest directly in the stock market indexes such as the S&P 500.  Investment return and principal value of an investment will fluctuate.  Investor value, when sold may be worth more or less than their original cost.

By |2023-01-23T20:44:05-05:00January 23rd, 2023|2023 Newsletters|0 Comments

Coronavirus Precautions Announcement

Hello from Sycamore,

We thank you all for your patience and understanding as we have navigated through the unchartered waters of COVID-19. The virus continues to be a significant risk to all of us so while we continue to remain fully operational, all business will continue to be conducted remotely (phone or computer screen share) through March 31, 2021. Our physical office locations will not be open. We will continue to do our best to answer every call or email as quickly as possible. All reviews will continue to be over the phone.

Our clients, employees, and community are our top priorities. We appreciate your patience and understanding as we all work together to stay healthy.

Thanks for your business and trust!

Allison Rumschik
Sycamore Financial Group

By |2022-07-20T15:38:58-04:00March 16th, 2020|2020 Newsletters|0 Comments

The Low Down on Retirement Accounts

Hello from Sycamore,

It’s that time of year again – if you are over 70 ½ and haven’t taken your Required Minimum Distribution (RMD) for the 2018 tax year, you can expect to be hearing from us!

What is an RMD?

An RMD is the minimum distribution you must withdraw from your retirement account each year.

When do I have to begin taking RMD’s?

You must begin taking your RMD on April 1 of the year following the calendar year in which you reach age 70 ½. What does this really mean?

Example: Your 70th birthday was June 30, 2017. You reach age 70 ½ on December 30, 2017. You must take your first RMD (for 2017) by April 1, 2018.

Example: Your 70th birthday was July 2, 2017. You reach age 70 ½ on January 1, 2018. You do not have to take an RMD for 2018. You must take your first RMD (for 2018) by April 1, 2019.

Then each year after this you must take your RMD by December 31 of that year.

Can I take more than my RMD amount?

You can withdraw more than the minimum amount required. The total amount you withdraw will be included in your taxable income.

Can I take withdrawals before 70 ½?

Yes. Once you reach 59 ½ you may take withdrawals with no early withdrawal penalty. You will still be responsible for regular income tax on the complete amount withdrawn.

You may also withdraw funds prior to age 59 ½ however, you will need to pay an extra 10% early withdrawal penalty in addition to the regular income tax.

Highlights for 2019

Retirement Savings Plan Contribution Limits have changed.

  1. 401(k), 403(b), 457 plans and federal government Thrift Savings Plan contribution limits increases from $18,500 to $19,000 annually.
    1. Catch up contributions for those over age 50 remains unchanged at $6,000.
  2. IRA contribution limits increase from $5,500 to $6,000.
    1. The additional catch up contribution remains at and additional $1,000 over the annual limit, now making it $7,000.
  3. SIMPLE IRA contribution limits have increased from $12,500 to $13,000.
    1. Catch up contributions limit for those over age 50 remains at $3,000.

For questions or concerns, please don’t hesitate to contact us with any questions.

Thanks for your business and trust!

Allison Rumschik
Sycamore Financial Group

*Past performance does not assure future results. Investors cannot invest directly in the stock market indexes such as the S&P 500. Investment return and principal value of an investment will fluctuate. Investor value, when sold may be worth more or less than their original cost.

By |2022-07-21T12:28:01-04:00December 5th, 2018|2018 Newsletters|0 Comments

ABOUT THE COMPANY

Sycamore Financial Group is an independently owned and operated regional financial services corporation. We use repeatable and sustainable processes and systems to support clients’ investment needs. This client-centered approach focuses on consistently producing the highest quality results in order to exceed your expectations. We concentrate our efforts and expertise to help assure the best possible results from your portfolio.

MORNINGSTAR RATING

MorningStar Rating Sycamore Growth and Income Composite was rated three stars against 697 Large Blend category funds overall for the period ending 12/31/2023
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