The Lowry Letter®

Week of 5/15/2020

We held our first “Ask the Joes® Live” on Wednesday and were glad to be able to connect with some of you in that way. This week’s Lowry Letter® will look at what we shared during that call. We will host another one soon, on a different day and time that might reach some of you who could not participate.

We will continue to meet with clients remotely for the present time. We can do this in a number of ways, from phone to Jitsi to Zoom to Facetime. Please don’t hesitate to contact us if you would like to talk. One of the nice things about videoconferencing is the ability to connect in a more meaningful way in the comfort of your own home.

We are adding a new member to our team, Briana. She starts on Monday and will be directly supporting Bea & Nicole. We look forward to introducing her to you soon.

We talked: about what nervous or tired investors should do during this period of uncertainty. Investing remains a long-term project. The risk tolerance and risk capacity of your specific need and situation should determine where your money goes. If you have a long-term goal, the current market turmoil should not play a major role in investment choices. If there is less time before the specific event, investing in the markets might not be the right call. As always, every situation is unique.

We think: Roth Conversions are worth considering for many of our clients. Whether it makes sense depends on your specific situation. If you think you will be in a higher tax bracket in the future, paying the tax now on pre-tax assets will save money IF the converted amount is left alone for 5 years or more. Other caveats apply, and we can discuss them further.

We shared: interesting data from JP Morgan on the industries most affected by COVID. These demonstrate how some of the economic impact of economic closures does not affect publicly-traded stocks. Industries like travel & tourism, restaurants, and retail contribute about 7% of the earnings of the Standard & Poor’s 500, while composing 20% of all payrolls. In other words, the dramatic declines in those industries and resulting unemployment is not having the same impact on the results of public companies.

We discussed: government efforts to aid the economy, such as the Paycheck Protection Program. Evolving guidance from the Small Business Administration caused some companies to reconsider their use of the PPP. On Wednesday, the SBA explained that for loans less than $2 million, they would assume that those loans were made based on a good faith attestation by the borrower that they were economically necessary.

We shared: that people with Federal Student loans are in a 6-month period where interest on student loans will not be accrued. We also explained the homeowners with Fannie Mae loans may participate in a forbearance program that will delay (not eliminate) mortgage payments for a period of time. You or your loved ones might benefit from such a program and we can review them with you.

During our call, we shared our outlook on COVID and the direction of the economy and markets. We expect volatility to continue given the uncertainty about the direction of the virus. Infection data does support efforts to reopen parts of the economy and we hope they will be successful. It will probably take several years before the economy reaches the same level of economic output as before the virus hit.

For a recap of how the markets performed in April, read our Monthly Market Recap .

Advisory Services offered through Lowry Financial Advisors, Inc., a Registered Investment Adviser. Securities and additional advisory services offered through Commonwealth Financial Network®, Member FINRA/SIPC, a Registered Investment Adviser. Advisory services offered through Lowry Financial Advisors, Inc, are separate and unrelated to Commonwealth. Lowry Financial Advisors, Inc. is located at 12921 SW 1st Rd, Suite 215, Tioga, FL 32669. 352-333-7990

Lowry Financial Advisors is the only advisory firm that helps its clients reach their goals through The Achieving Simplicity® Experience™, providing clarity and confidence in their personal and financial lives.