IN THE KNOW
Monthly Newsletter
March 2020
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In this month's newsletter we have timely articles on Coronavirus and market declines, information on our Business Continuity Plan, and important information on 2020 tax changes including the announcement of the extension of the IRS Filing Deadline.
We are a firm that understands that managing your assets is about more than money. It is about empowering your future. At ML&R Wealth Management, we focus on you.
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Monday, March 9th, marked the 11th anniversary of the crescendo of the global panic that marked the bottom of the bear market of 2007-09. It is wonderful irony that the world has elected to celebrate this iconic anniversary with another epic global panic attack. As we all know by now, the precipitants of this decline have been:
(a) the outbreak of a new strain of virus, the extent of which can’t be predicted,
(b) the economic impact of that outbreak, which is equally unknown, and
(c) most recently, the onset of a price war in oil.
The common thread here is the unknown: we simply don’t know where, when or how these phenomena will play out. We have no control over the uncertainty; BUT we can and should have perfect control over how we respond to it.
Advisor, Vanessa McElwrath recently sat down with KVUE to discuss this topic in detail. View the video below for estate planning tips.
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Before I begin the tax portion of this article, I just want to share a few thoughts I have had while communicating with clients as we work through this challenging time. Extreme uncertainty can make us all more emotional, naturally. However, getting through adversity requires that we keep our faith in the principles that we know have stood the test of time. It is easy to forget how difficult things were after a distant crisis has passed, especially with the benefit of a long stretch of good times. When the next unexpected crisis comes along, we feel like this one is different and worse than anything in history. Psychologists call this the fading affect bias. We must keep things in perspective and remember that our country has persevered through very difficult challenges before. We will get through this challenge too! We don’t know when, but we will persevere by collectively sticking to our principles and values.
Ok, let’s talk about taxes.
Retirement Savings
For 2020, the maximum contribution to an IRA is $6,000 (plus $1,000 catch up for age 50 and older). The maximum contribution to a 401(k) account is $19,500 (plus $6,500 catch up for age 50 and older). Traditional IRA contributions and 401(k) salary deferrals are pre-tax, so you get the benefit of reducing your taxable income. Also, while we do not know how stocks will perform in the months ahead, they can clearly be bought cheaper now than in the recent past. It is important to continue contributing to your retirement account if you are able because your contribution buys more shares.
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Financial Wellness Q&A
In this section we will address common personal finance questions. Email
wealth@mlrpc.com
if you have a question you would like answered.
Question:
Even though the IRS extended the 2019 tax filing and payment deadline to July 15
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, do I still need to make estimated payments for 2020 on April 15
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and June 15
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as in prior years?
Answer:
IRS Notice 2020-18 states that all estimated tax payments originally due on April 15 for the 2020 tax year do not need to be submitted until July 15. Further, there will be no penalties and interest assessed on these balances due.
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Updates from our Parent Company, Maxwell Locke & Ritter
Treasury Secretary Steven Mnuchin announced today via twitter that taxpayers will have an additional three months to file their tax returns, to go along with the extension of the payment deadline previously announced.
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his week, President Trump on March 18
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signed into law the Families First Coronavirus Response Act, which requires employers to provide paid family and medical leave, and sick leave, to employees and provides payroll tax credits for employers providing the leave.
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ML&R's Business Continuity Plan
As the novel coronavirus (COVID-19) continues to spread in the U.S. and across the world, our priority at ML&R Wealth Management is the safety and well-being of our people, clients, families, and community. Additionally, we are minimizing the impact that COVID-19 could have on our services and are monitoring daily updates and recommendations from the CDC. We have employed the safeguards below to ensure the health and well-being of our people as well as our clients and friends who visit our offices. These safeguards should also allow us to continue to meet our clients’ investment-related needs.
- Because of our commitment to a flexible work environment, we have the technological, cultural and operational infrastructure to work remotely if needed.
- We have software that allows us to meet with our clients remotely to walk through documents electronically and answer questions or issues you may have concerning your needs.
- We have large digital file transmitting capabilities, online portals, and access to courier services and will work with clients on an individual basis to ensure that the delivery of files is safe and efficient. If such assistance is needed, please contact your advisor for the best delivery option.
- If visiting our office, rest assured that our high traffic areas receive additional detailed cleaning. Moreover, our people are following the recommended hand-washing regimen and have been provided hand sanitizer throughout our office space.
ML&R has a business continuity plan for emergencies such as COVID-19. As your trusted advisors, we will continue to monitor this ever-changing situation and will modify our plan as necessary to ensure we can serve our clients to the best of our abilities. Please contact us at (512) 275-2700 if you have any further questions.
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Jake DeKinder, Head of Client Communications, and Mark Gochnour, Head of Global Client Services, discuss recent volatility in financial markets and provide perspective on these events.
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Cybersecurity Reminders During COVID-19
These are unsettling times and we all have a thirst for more information about what is going on and how long it will last. However, we must still be diligent online. Below are a few of the latest cyber scams to watch out for:
- Outbreak maps - Malicious actors have begun spreading malware through online maps claiming to track the impact of coronavirus. As users visit the sites or click the links, they are exposing usernames, passwords, credit card numbers, browsing history, or other nonpublic personal information that is then exploited by the attackers or sold to other criminals on the dark web.
- Email campaigns - Criminals are also leveraging common forms of fraud like spam email campaigns, using infected attachments or downloads to gather information.
- Charitable giving - Scammers may pose as clients claiming to need funds for charitable contributions or expenses related to the virus. Be on guard for sudden or urgent requests for funds — and talk to your clients about how they can protect themselves from falling victim to such schemes.
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Subscribe to our 401(k) Plan Services Quarterly Newsletter
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Are you responsible for administering your company's 401(k) plan?
Would you like more insight and resources regarding the retirement plan services industry?
If so, please subscribe to our 401(k) Plan Services Quarterly Newsletter. You can check out the last few issues below.
See our latest Retirement Plan Services articles:
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What's Happening in Austin This Month
While we know there are no in-person events for the next month, we wanted to share virtual events and activities.
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About ML&R Wealth Management:
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At ML&R Wealth Management, we take investing personally. Your ML&R Wealth Management advisor will work to develop a lasting relationship with you, keeping in touch to understand your changing goals and to provide an asset management strategy to help achieve them. Whenever you need sound financial advice, you have a direct line to a trusted advisor.
For over 20 years, we have served individuals, families, businesses, and nonprofits with wealth management services, custom retirement and 401(k) plans, and portfolio management.
We believe in accountability and transparency and operate as a fee-only advisor with fees calculated solely on assets under management.
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