Main Kokomo Office: 765-455-1554|info@sycamoreweb.com

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 You will still be responsible for regular income tax on the complete amount withdrawn.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

Third Quarter 2024 Market Commentary

Hello from Sycamore,

Performance and The Markets

Let’s start with the good news! September is historically the worst-performing month of the year for the stock market, but not in 2024. Our composite gained a little more than 1.5% for September, it has gained a bit more than 27% for the last 12 months, and over the last 10 years, it has gained 224% or almost 11% per year. These have indeed been wonderful times for shareholders. We cannot see into the future, but for practical purposes, we believe the next 50 years will be like the past 50 years. However, over the next 10 years, we expect returns to be muted somewhat when compared to the past 10 years.

Let’s all take a moment to thank Adam Smith for promoting capitalism when our country was formed. Capitalism can be difficult from time to time and brutal occasionally, but it is efficient. As shareholders, capitalism (recessions included) is our friend. Our economy continues to grow, we’re creating more jobs, inflation is being tamped down, and interest rates have been reduced recently. There is always room for improvement and there are always ‘pundits’ sharing their version of doom (bad news sells, ya know), but we do not see anything on the horizon that will derail our economic growth or the stock market. Of course, the stock market can sometimes be emotional, so we’ll need to be prepared for the normal ups and downs. This is not 1999. We are finding many companies that can be purchased at what we feel are bargain prices.

The Economy

As I mentioned earlier, our economy continues to perform well. It appears that the Federal Reserve Bank believes inflation is under control enough to start reducing interest rates. A reduction of 0.5% was announced recently. Our gross domestic product – which recently has been revised upward by the Commerce Department – has been growing at a modest and steady pace of a little more than 2% since 2020. Housing starts are weaker than we would like, but auto sales have remained firm and are trending higher. We think the recent decrease in interest rates will help both industries. Job creation has slowed over the past year, but we still have created almost two and a half million new jobs over the last 12 months. Currently, we expect – and look forward to – more slow and steady growth from our overall economy. Thank you, Adam Smith.

Investors vs Speculators

Each fall we like to thank you for being investors and not speculators, and we like to remind you of our investment goals for your account(s) that are using our ‘Growth at a Reasonable Price’ (GARP) strategy. First, we work to deliver reasonably good returns. Second, through our ‘risk first’ analysis and broad diversification, we make a concerted effort to reduce risk and volatility in your portfolio(s) with us. The markets have been good for so long that it’s easy to forget about the risk side of investing, but we have not been trying to hit ‘home runs’ in the past and we have no plans to start now. We’ve learned over the years that additional risk can mean LESS return. We have no plans to place your capital at additional risk no matter how tempting the current ‘story’ is. Third, we do our best to keep taxes on your portfolio(s) as low as possible, but please remember that taxes are a secondary consideration…our first goal is to earn profits.

Purchase and Sale Activity During Q-3

Sales: Stericycle (SRCL), Sirius (SIRI)
Buys: Nice LTD (NICE), VeriSign Inc. (VRSN)

Thanks for your business and trust!

Sincerely,
The Sycamore Financial Group Team

*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 |2024-10-22T22:23:51-04:00October 22nd, 2024|2024 Newsletters|0 Comments

Certified Financial Planner Achievements

Hello from Sycamore,

We are thrilled to announce the recent achievements of two outstanding members of our team, Allison Rumschik and Brent Yard. Both Allison and Brent have successfully completed the rigorous coursework, passed the comprehensive 6-hour final exam, and have now earned the prestigious marks of Certified Financial Planners™.

Allison-Rumschik-Sycamore-FinancialThe CFP® designation identifies individuals who have met the stringent experience and ethical standards set by the CFP Board. This includes the successful completion of financial planning coursework at an accredited college or university and passing an exam that covers a wide range of topics: Professional Conduct and Regulations, General Principles of Financial Planning, Risk Management and Insurance Planning, Investment Planning, Tax Planning, Retirement Savings and Income Planning, Estate Planning, and the Psychology of Financial Planning.

Certified Financial Planner™ professionals commit to acting as fiduciaries, which means they always act in the best interests of their clients when providing financial advice. Allison and Brent have demonstrated their dedication to this principle, showcasing their commitment to providing superior results for our clients, our industry, Sycamore, and themselves. We could not be prouder of the dedication and commitment they’ve demonstrated.

Brent-Yard-Sycamore-FinancialSycamore Financial Group understands that each individual has unique financial aspirations. Consistently achieving these goals hinges on a close relationship with a trusted, knowledgeable financial advisor. With decades of experience in investment management and financial planning, our team is dedicated to strategically safeguarding and enhancing the assets of our clients. We prioritize three objectives for our client’s portfolios: delivering solid returns, minimizing volatility, and optimizing tax efficiency.

Our enduring relationships attest to the quality of service and tangible investment outcomes we provide. By comprehensively understanding your financial goals and objectives, we collaborate to craft a tailored plan that aligns with your specific investing, retirement planning, or college savings strategies. At Sycamore Financial Group, we are committed to guiding you toward financial success with expertise, dedication, and personalized attention.

Please join us in congratulating Allison Rumschik and Brent Yard on their impressive accomplishments and their continued commitment to excellence in financial planning.

Sincerely,
The Sycamore Financial Group Team

By |2024-07-16T18:20:26-04:00July 16th, 2024|2024 Newsletters|0 Comments

The Low Down on Retirement Accounts 2024

Hello from Sycamore,

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

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 on 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 anytime in 2023. As long as you will reach age 73 by December 31, 2023, you must take your first RMD (for 2023) by April 1, 2024.

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 2024

Retirement Savings Plan Contribution Limits have changed.

  1. 401(k), 403(b), 457 plans, and federal government Thrift Savings Plan contribution limits are $23,000.
    1. Catch-up contributions for those over age 50 are $7,500.
  2. IRA contribution limits increase to $7,000.
    1. Catch-up contributions for those over age 50 are $1,000.
  3. SIMPLE IRA contribution limits $16,000.
    1. Catch-up contributions for those over age 50 are $3,500.

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 |2024-07-16T17:02:20-04:00May 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

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
Go to Top