Waypoints

Market Perspectives - Second Quarter 2019

What to make of these markets?

U.S. equities continued their strong performance, ending the second quarter of 2019 with the S&P 500 index up 4.3%. The trend of growth-oriented stocks outperforming value-oriented stocks continued as well across all company sizes. On the fixed income side, interest rates declined across the board in the U.S. and with investors continuing to look for safe havens, higher quality corporate and taxable municipal bonds1 both posted returns of 4.5%.

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Family Perspectives

Are THEY prepared?

Parents often worry that their children (and grandchildren) are not prepared to handle the wealth that they may one day inherit. They are concerned that the next generations may not fully understand or appreciate their family history and values and that they may lack adequate financial skills and discipline.

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In the 2018 U.S. Trust Insights on Wealth and Worthstudy which surveyed nearly 900 respondents with $3 million or more in investable assets, there were five topics, listed in order of importance, that these high net worth individuals wanted to discuss with their advisors. The percentages listed after each of these topics represent the number of those interviewed who are actually discussing these topics with their advisors.

  1. Estate planning (48%)
  2. Trust options and implications (35%)
  3. Strategic philanthropy (16%)
  4. Use of family wealth (20%)
  5. Teaching children/heirs financial skills (21%)

In other words, while high net worth clients may say that “facilitating discussions about the use of family wealth” is the fourth most important topic to discuss, only 20% of them actually are having the conversation with their advisors, much less with their families! While many wealthy people already have in place a good will and an estate plan, many of them -- like the people in this study -- have good intentions but just have not gotten around to discussing with their families some of these important topics.

Many people have good reasons for not broaching these emotional subjects. Some parents fear that if children know how much money may be coming to them, they will not be motivated to find their own way in life. Or their children may be at different places in their own lives… some more capable of handling money than others. Also, their children may be scattered and beginning to raise their own families – so, while there may be interest in having the conversation, there hasn’t been a convenient time or location for a discussion. Finally, many people are active and busy and just haven’t gotten around to it.

If you are nodding as you read this, we encourage you to begin to take steps so that your children/grandchildren are prepared for what may someday be theirs. Reaching across generational lines to talk about your family’s unique history and legacy can be a rewarding and educational experience for all involved. If you do not want your children to know the full extent of your wealth, there are ways to structure the conversation that does not reveal the true nature of your net worth.

You might consider scheduling a family meeting specifically for this purpose. Your advisors may have some resources to help you get started. Focusing the discussion around family history, family values and philanthropy can be a good place to begin. Also, you may want to enlist the help of a professional facilitator to assist in guiding the discussion. A neutral third party can put the participants at ease and keep the conversation from swerving off track.

Regardless of your approach, taking time to impart financial knowledge and family values ensures that future generations will be equipped to handle the responsibility of wealth.

[1] 2018 U.S Trust Insights on Wealth and Worth; https://www.privatebank.bankofamerica.com/articles/insights-on-wealth-and-worth-2018.html

In the Spotlight: Congrats to Nirali!

In the Spotlight: Congrats to Nirali!

On May 11, 2019, Nirali Raval, Waypoint’s Associate Relationship Manager, married Anthony (Tony) Trovato. The wedding took place at the historic Atlantic Wildfowl Heritage Museum. Originally from Pennsylvania, Tony is a fourth-grade teacher at Glenwood Elementary in Virginia Beach. They recently arrived from their honeymoon in Costa Rica. They thoroughly enjoyed their stay and adventures at Playa Nicuesa Rainforest Lodge, which is an eco-resort.

Waypoint in the Community

Giving back to our community is at the heart of who we are and what we do at Waypoint Advisors. Every team member believes in the importance of being an active community member and gives back in ways that matter to them.

We are proud members of the following civic, professional and charitable organizations:

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· United Way of South Hampton Roads

· ACCESS College Foundation

· ForKids

· Hampton Roads Community Foundation

· Chesapeake Bay Academy

· Chesapeake Bay Foundation—HR Advisory Council

· Hampton Roads Gift Planning Council

· Virginia Symphony Orchestra

· EVMS Foundation

· TowneBank—Director

· Horizons Hampton Roads

· VB Friends School—Friends of Friends

· Read Across America

Did you know?

Did you know?

Did you know that 2018 saw the first decline in individual charitable giving after eight years of consecutive growth? According to the Giving USA 2019 report, individual giving declined 1.1% in 2018 (-3.4% after adjusting for inflation), but still totaled $292 billion[1]. The decline can be attributed to a number of factors, including a complex tax environment in 2018 where the number of households claiming itemized deductions was more than cut in half from 2016. Many families found themselves below the threshold to claim the benefits of charitable deductions for their giving. One way to preserve that benefit is by “bunching” or grouping several years’ worth of annual gifts to a charity into one year to surpass the threshold for itemized deductions. Waypoint Advisors is happy to help you think strategically about your philanthropy.

 

[1] Giving USA 2019: The Annual Report on Philanthropy for the Year 2018, Giving USA Foundation, June 18, 2019.

Market Perspectives - First Quarter 2019

Are You Prepared? (Part III)

Equities recovered nicely in the first quarter with the S&P 500 ending up 13.6% and the Russell 2000 small cap index returning 14.5%. The International MSCI-EAFE and MSCI Emerging Market indices were both up in the 10% range. The Equity Hedge Index (HFRI) posted a 7.2% return. In fact, nearly every equity index was positive for the first quarter of 2019.

With equity markets continuing their positive surge, you may be scratching your head and thinking, “where’s all the risk everyone is talking about?”

(Click the PDF icon at right to read more...)

In the Community: Nirali goes back to school!

In the Community: Nirali goes back to school!

On January 29th, Christopher Newport University hosted a financial literacy event on campus for all students. Hayden Cochran, a junior at CNU and son of Lori Cochran, Waypoint's Operations Manager, organized the event and invited Waypoint to participate. The panel consisted of a CNU accounting professor, Waypoint's Nirali Raval, and a CEE Fund chairman. Students engaged in an interactive discussion and Q&A on topics such as establishing smart spending practices, creating a financial plan, paying for student loans, and diversifying investments. Nirali shared personal finance stories, as well as resources and tips to help students prepare for successful financial independence.

Waypoint believes it is important to engage high school and college students in financial literacy education as it positions them to be good stewards.

Did you know?

Did you know?

Now is a great time to review your charitable giving for the year. Consider giving now to avoid the year end rush and take advantage of high market valuations. Don't forget to take the time to ensure that your annual giving is aligned with your values.

Market Perspectives - Fourth Quarter 2018

Are You Prepared? (Part II)

In our last newsletter, you may remember that we talked about how hurricanes are like market corrections – no one knows when they are coming, but it is better to be prepared for the worst when a storm is looming on the horizon.

While not quite a hurricane, the fourth quarter did give us some scary moments and sent us wanting to run for shelter. 

(Click the PDF icon at right to read more...)

In the Spotlight: Waypoint's Newest Members!

In the Spotlight: Waypoint's Newest Members!

Waypoint is pleased to welcome several new members to the family! In the last several months, John Clunan got Leo, a yellow Labrador Retriever; Kelly McCarthy got Dash, who we believe is a Shepherd mix – part German, part Australian; and Susanna Dellinger got Elvis, an English Cream Golden Retriever. We couldn’t be happier about our new furry friends!

Market Perspectives - Third Quarter 2018

Are You Prepared? (Part I)

By the time the American and National Leagues sort out who will go to the World Series and college football teams wrestle to get to the National Championship game, we will be almost done with a different kind of season that is often fraught with uncertainty and havoc - hurricane season!

In sports, no matter how well prepared you are, the unexpected can happen (think Old Dominion and Virginia Tech!). Hurricanes, too, are unpredictable, and it is wise to take precautions while the sun is shining. Recently, our community was fortunate to have missed the wrath of Hurricane Florence. But not before schools and businesses were closed and thousands of people were instructed to evacuate. The inconvenience of the preparation was a small tradeoff for the reassurance that family and friends were protected no matter which way the storm turned.

Investing is much like preparing for a storm. (Click the PDF icon at right to read more...)

Did you know?

As we approach the holidays and the season of gift-giving, it is a great time to plan year-end gifts to charity and to make tax-free gifts to loved ones. If you are planning to make any gifts to charity between now and the end of the year, you may want to consider gifting appreciated securities rather than cash.

Waypoint Advisors is happy to help with these and any other year-end tax planning strategies that may be appropriate for you.

Market Perspectives - Second Quarter 2018

Walking the Tightrope - Don’t Look Down

Compared to the wild ride we experienced early in the first quarter, market volatility and high valuations settled into a more comfortable range during the second quarter. But, even though most economic indicators point to continued growth in the markets, investor emotions remain on edge, swinging between optimism and pessimism as forces that support global growth are offset by competing forces that deter growth. This balancing act causes many of us to worry, “How long will this bull market last and what could derail it?”

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Family Perspectives

At Waypoint, we try to view issues pertaining to wealth management through the eyes of the families we serve. Recently we conducted a survey that indicated many of our readers were interested in topics such as education strategies, taxes, estate planning and philanthropy. As a result, we are going to add a piece in our newsletter from time to time addressing these topics.

A Time of Transitions

“No graduate gets to this moment alone. I want to acknowledge your parents and grandparents and friends that are here cheering you along just as they have every step of the way.” - Tim Cooke, CEO of Apple, 2018 Commencement Speaker, Duke University

This spring it seemed as if everyone we knew had a graduation or two on the calendar. Children, grandchildren, nieces, nephews. College, high school, middle school, even kindergarten. Such excitement! Such optimism! Such buoyant confidence! A wonderful time of reflection and hope for the future (and no more tuition payments!).

Graduations remind us that life is full of transitions and that having good plans in place can help ease the anxiety of change and market uncertainty. With the slower summer months in front of us, this can be a good time to review, update, or implement family wealth strategies. 

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In the Spotlight: Waypoint Welcomes Kelly McCarthy

In the Spotlight: Waypoint Welcomes Kelly McCarthy

Kelly is a proud military brat and Virginia Beach local. She brings to Waypoint experience in both Family Office and Private Equity Fund Administration from Wall, Einhorn & Chernitzer, P.C. and Envest Holdings, LLC. She is on target to earn her Executive Certificate in Financial Planning from Old Dominion University this fall.

Market Perspectives - First Quarter 2018

Volatility is Back

In previous newsletters we talked about the eerie calm of the markets last year. In all of 2017, the S&P 500 index did not fluctuate more than 2% and it set 62 record highs over the year (the second most within a single year since 1990), ending up 21.8%. In contrast to the peaceful afternoon zephyrs of 2017, the first quarter of 2018 was a squall. Average daily volatility of the S&P 500 index jumped 355% in late January, with peak volatility in Q1 more than 1322% higher than the average from the prior 13 months.

In the Spotlight: Jane Short Chairs Women United Board

In the Spotlight: Jane Short Chairs Women United Board

Waypoint teammate Jane Short has been elected Chair of the Women United board for the United Way of South Hampton Roads. Founded in 2002, Women United has grown to a force of over 900 local women who through philanthropy and volunteerism are transforming the lives of women and children in South Hampton Roads. The South Hampton Roads chapter has raised more than $7 million to create the largest Women United Endowment Fund in the nation. To date, the group has invested more than $600,000 in community programs that address the issues of families in poverty.

Waypoint in the Community: Read Across America Day

Waypoint in the Community: Read Across America Day

On February 9, 2018, members of the Waypoint Advisors team participated in a national initiative called "Read Across America Day." Organized locally by the Virginia Beach GrowSmart Foundation, over 150 volunteers read in 237 classrooms and distributed 5,446 total books in every Virginia Beach Public Schools Pre-K, Head Start, Parks and Rec early childhood programs, and a variety of private childcare centers. The Waypoint team had the pleasure of reading the Dr. Seuss book, Oh the Thinks You Can Think!, to children at Parish Day School. "I cannot say THANK YOU enough!" wrote Miss Devin Cowhey, Virginia Beach GrowSmart Development Specialist. "We are so lucky to have you all as guest readers for this wonderful event. Without you, it wouldn't be possible." 

Did you know?

The recently passed Tax Cuts and Jobs Act has expanded the use of 529 plans. This tax-free way to accumulate money for college and other higher education programs now allows distributions up to $10,000 per year for K-12 education expenses at public, private or religious institutions. Waypoint can help you determine the best strategy for you and your unique situation. Virginia currently offers a tax deduction of up to $3,500 per account each year for contributions to 529 plans. If a deduction can’t be used in the year the contribution is made, it can be rolled over indefinitely to future years.

Virginia continues to receive high honors for its 529 plans.

Market Perspectives - Fourth Quarter 2017

As part of our year-end review of the markets, we decided to have a little fun and create a quiz touching on some of the interesting stories of 2017. See how you do! You will find the answers embedded in our Market Perspectives (see PDF at right) and in the Waypoints section of our website.