COVID-19 Stimulus Package

Hello from Sycamore,

On March 27th, 2020 congress passed and the President signed into law a roughly $2 trillion stimulus package to help individuals and businesses deal with the fall out due to COVID-19. We have not had a chance to learn the specifics of this bill but understand the basics. Here are some of the policies that we think are pertinent to investors.

  1. Required minimum distributions from IRA type accounts have been waived for 2020.
  2. If you have already taken your 2020 RMD it appears that you may be able to ‘roll’ that distribution back into the IRA but only if you can put the money back within 60 days of the distribution. If you took your distribution early in 2020, these monies cannot be put back into your IRA type account.
  3. The tax filing deadline has been moved to July 15th, 2020 and with this, so has the date to make contributions to IRAs and health savings accounts for 2019.
  4. The 10% tax penalty on withdraws from IRA type account for those not yet 59.5 years old is waived on withdraws up to $100,000.
  5. IRA distributions in 2020 will be allowed to be paid back in full within 3 years and not incur any tax as long as the distribution is due to disaster relief. If you elect not to repay this amount, the distribution is taxable as ordinary income. Additionally, you may have the ability to pay this tax liability over 3 years.
  6. Loans from your 401(k) etc. are now allowed up to $100,000 or 100% of the account balance.

If you currently take RMD’s from your account with Sycamore and do not need the money for living expenses, it may be wise to delay those payments. This would allow for a reduced tax bill and potential for having to liquidate assets at a reduced price.

We want to remind you that we are fully operational during these times but are conducting business only remotely. The health and safety of our community continue to be at the forefront of Sycamore’s mind.

Brent Yard
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 |2020-04-02T06:04:52-04:00April 2nd, 2020|2020 Newsletters|0 Comments

Surviving the “Bear”

Hello from Sycamore,

Sir John Templeton, founder of the Templeton funds, had some investment advice for us in August of 1958. “To buy when others are despondently selling and to sell when others are avidly buying requires the greatest fortitude and pays the greatest ultimate reward”. In March of 1994 Sir John had additional wisdom for us. “ This time is different are among the most costly four words in market history”.

I think we can all agree that talking about the last bear market (with the benefit of hindsight) and living through the current bear are two very different things.

All bear markets are different and also the same. Each time we have a sell-off based on emotion, there’s a different event/trigger that causes the sell-off. But each bear market is the same because they involve emotional investment decisions rather than rational  (based on the math or data) decision making. All bear markets are stressful because we are not able to see into the future but this one is more stressful than most because we are all dealing with the possibility of becoming infected with COVID-19 in addition to watching our accounts lose market value.

When you originally made your investment allocation decision, you were not being towed around by your emotions. Changing that original allocation decision based on the current market condition is usually a mistake.

History tells us that ‘bear’ markets generally serve up many wonderful investment opportunities for those that remain cool, calm and collected.

Thank you all for being great investors and for having ice water in your veins and for your business and trust!

Craig Smith
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 |2022-07-21T12:22:10-04:00March 30th, 2020|2020 Newsletters|0 Comments
Go to Top