Quote of the Week
“A multitude of small delights constitute happiness.” – Charles Baudelaire
Last week was pretty much “ho hum” in the markets with the markets basically even. Our new positions in Energy is doing well, and our new positions in REITs, Utilities, and precious metals were slightly down.
Interest rates rose last week, so our bond position didn’t fare well. Remember when interest rates rise, bond prices go down.
If the economy continues to decline our new positions and our fixed income positions should benefit.
The recent March Industrial Production (down 0.68%) was the latest confirming evidence of the ongoing slowdown in domestic economic activity. On a year over year basis of +2.75% represents the slowest rate of change for U.S. manufacturing growth since July of 2017.
Investors should not expect a sustained rebound from here amid increasingly difficult comparisons and now-trending deceleration in aggregate wage and salary income growth. That’s not to say wage growth is going to start dropping from a trending perspective and alleviate the upward pressure on corporate expense; instead it means U.S. corporations are likely to slow their rates of hiring further and potentially drawdown on employee hours worked as the corporate profit recession broadens over the next couple of quarters.
On Friday the first report of first quarter GDP numbers comes out. That should tell us a lot about how the economy is trending. A low number could have a negative effect on the markets. We will know a lot more on Friday morning.
|Name||Wkly %Chg||YTD %Chg||12-mo %Chg|
|Dow Jones Industrials||+0.56||+13.86||+07.68|
|10-yr Treasury Yield||+0.01||– 0.12|
|*5-day performance ending Friday|
Lisa’s Thoughts – Caring for Your Aging Parents
What is it?
Caring for your aging parents is something you hope you can handle when the time comes, but something you probably hope you never have to do. Caring for your aging parents means helping them plan for the future, and this can be overwhelming, both physically and emotionally. When the time comes for you to take care of your parents, you may be certain of only two things: Your parents need you, and you need help.
Talk to your parents about the future
Start caring for your aging parents by talking with them about their needs and wishes if they are able. In some cases, however, they may not be willing to talk to you about their future, either because they are afraid to face it or because they resent your interference. If this is the case, you may need to do as much planning as you can without them, or, if their safety or health is in danger, step in as caregiver anyway.
Prepare a personal data record
The first step you should take is to ask your parents to help you prepare a personal data record (if they are unable to help you, you’ll have to search for the information yourself). A personal data record is a document that lists information that you might need in case your parents become incapacitated or die. Information that should be included is financial information, legal information, medical information, insurance information, and information regarding professional advisors and the location of important records.
Example(s): When Marcia and her mother prepared a personal data record, Marcia realized that her mother did not have a durable power of attorney or health care proxy in case she became incapacitated and could not make decisions about her medical care. The next day, Marcia made an appointment with her mother’s lawyer to discuss this issue.
You can’t know everything, and you probably don’t have enough time to learn everything you need to know to care for your parents. That’s why you should seek advice from professionals. Some advice will be free, and some you will have to pay for. If you live far from your parents or are too overwhelmed to handle all your parents’ affairs, you can hire a geriatric care manager who will evaluate your parents’ situation, suggest options, and coordinate professionals who can help. In addition, talk to your employer. Some employers have set up employee assistance programs that offer advice and assistance to people who are dealing with personal challenges, including caring for aging parents.
Don’t try to care for your parents alone. Many local and national caregiver support groups and community services are available to help you cope with caring for your aging parents. If you don’t know where to start finding help, call the Eldercare Locator, an information and referral service sponsored by the federal government that can direct you to resources available nationally or in your area. Call the Eldercare Locator at (800) 677-1116.
What kind of advice will you need?
Housing and health care advice
If your parents are like many older individuals, where they live will depend upon how healthy they are. As your parents grow older, their health may deteriorate so much that they can no longer live on their own. At this point, you may need to find them in-home health care or health care within a retirement community or nursing home. On the other hand, you may want them to move in with you. In addition, you will need information on managing the cost of health care, long-term care insurance, major medical insurance, Medicare, and Medicaid.
- National Association for Home Care
- Visiting Nurse Associations of America
- Centers for Medicare & Medicaid Services (formerly known as the Health Care Financing Administration)
- American Association of Homes and Services for the Aging
- American Association of Retired Persons (AARP)
- Health Insurance Association of America
If your parents need help managing their finances, you may need to contact professionals whose advice both you and your parents can trust, including one or more of the following individuals or organizations.
- Your financial planner
- Your banker
- Your investment counselor
- Your tax attorney
- The Social Security Administration
Legal advisors can help you plan for your parents’ incapacity (including preparing documents such as power of attorneys, medical directives, and living wills), contact nursing home ombudsmen, set up and monitor guardianship, prepare wills, give tax advice, and provide bill payment and representative payee assistance. Many states provide funds for the delivery of free legal services to the elderly and many attorneys specialize in elder law, so finding legal advice shouldn’t be difficult.
- Your attorney
- National Association of State Units on Aging
- American Bar Commission on the Legal Problems of the Elderly
- Legal Counsel for the Elderly
What kinds of support and community services will you need?
Caring for your aging parents will be easier if you know what kinds of support and community services are available and where to locate them. The following is a list of the kinds of support and community services you can find locally and nationally, along with specific suggestions of who to contact for information.
Adult day care
If you need to work or run errands and you can’t leave your parents alone, consider using adult day care. These programs are located in hospitals, churches, temples, nursing homes, or community centers. Many are private nonprofit organizations. Adult day care can be expensive but is sometimes subsidized by the government, and fees may be based on a sliding scale. In addition, Medicare, Medicaid, long-term care insurance, or your health insurance may pay part of the cost.
- Your local senior center or community center
- National Institute on Adult Day Care
- The Alzheimer’s Association
Caregiver support groups (self-help)
Many self-help groups are available to provide information and emotional support on broad topics (such as aging) or specific topics (such as heart disease). You may find these support groups helpful if you know little about caring for your aging parents. Such groups might also provide an opportunity to help others by sharing your experiences.
- The Alzheimer’s Association
- Children of Aging Parents
- National Self-Help Clearinghouse
Caregiver training/health education
You may feel better about taking care of your parents if you are armed with knowledge. You may want to complete first-aid courses or take classes in gerontology.
- Your local college or university
- Your local hospital
- The American Red Cross
If you are uncertain of your parent’s mental or physical capabilities, ask his or her doctor to recommend somewhere you can take your parent to undergo an assessment. These assessments can be done at hospitals or clinics. Your parent will be evaluated to determine his or her capabilities. The evaluation determines whether the individual can take care of himself or herself on a day-to-day basis, including such things as bathing, dressing, eating, using the telephone, doing housework, and managing money. Based on this evaluation, you and your parent will receive advice regarding care options.
- Your doctor
- Your lawyer
- The National Association of Professional Geriatric Care Managers
- Aging Network Services
When you are caring for your aging parents, you may feel guilty or even resentful because you don’t have limitless energy. Taking care of your parents is hard work, however, and everyone needs a break once in a while. If you are caring for your aging parents, look into respite care. Medicaid may pay for some respite-care services.
- Your doctor
- Your local hospital
- The Alzheimer’s Association
- National Association for Home Care
Financial and tax considerations for you
Caring for your aging parents is not only an emotional burden for you but may be a financial one as well, depending upon how well off your parents are and how much caring for them costs. Because many adults today are becoming first-time parents in their thirties, and others are remarrying and rearing second families, increasing numbers of adults are finding themselves in the “sandwich generation.” They face having to pay expenses of growing children (including college expenses), plan for their own retirement, and support their aging parents financially. Thus, it’s important to plan not only your parents finances, but your own as well.
Financial planning for your parents
Making sure that your parents won’t outlive their money is a critical step in ensuring that your own finances will remain sound. In particular, you’ll need to make sure that your parent is receiving all the benefits to which he or she is entitled and that his or her money is invested wisely. You’ll also need to create a financial profile for your parents, a statement that includes income, expenses, and net worth. If, after considering your parent’s financial condition, it’s clear that they won’t have enough resources to pay for their own care, you’ll need to find ways to supplement their income. You may need to look at Supplemental Security Income (SSI), for instance, or ask other relatives for help. You’ll also have to determine how much financial support you can give your parents (see below).
Financial planning for you
Besides caring for your parents, you have a lot of other financial obligations. Before you can determine the best way to help your parents financially, you’ll have to look at your own financial picture. Not only will you need to consider your current expenses, but you’ll have to look down the road a few years, considering how much you’ll need to save for your own retirement and, perhaps, for your child’s education.
Tip: Due to the complexities inherent in providing adequately for several generations in the same family, consider seeking the advice of a financial professional.
Tax benefits for children supporting aging parents
Federal income tax law provides several tax benefits to you if you are supporting your parents financially. If you have a dependent care account at work, you can put pretax dollars into the account that you can use to pay for some costs associated with caring for your dependent parents. You may be able to claim an exemption for your parents as dependents, and you may be entitled to claim a dependent care credit. In addition, you may be able to file your taxes as head of household and deduct medical expenses you paid for your parents. For more information consult your tax advisor.
Questions & Answers
If you are financially supporting your parent, is he or she entitled to receive Social Security benefits based on your earnings?
If you are providing at least one-half of your parent’s support at the time of your death, and he or she is age 62 or over and is not entitled to a retirement benefit that is equal to or larger than the amount he or she would receive based on your earnings record, then he or she may be entitled to receive a parent’s Social Security benefit equal to 82.5 percent of your primary insurance amount (PIA).
Copyright 2019 Broadridge Investor Communication Solutions, Inc
By the Numbers
NOTHING?! – 45% of the 76 million “Baby Boomers” in the USA have no retirement savings. “Baby Boomers” were born between 1946 and 1964, i.e., the oldest “boomers” turned 65 years old in 2011. “Boomers” reaching age 65 in 2019 represent the 9th year of 19 years of “Baby Boomers” (source: Insured Retirement Institute). Michael A. Higley, BTN 04-22-2019
If you have friends or family in need of financial life planning services,
It would be the honor of Laurence Lof Financial Advisors to assist them.
We value your referrals!
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These are the opinions of Larry Lof and Stephanie Mayoral and not necessarily those of Cambridge, are for informational purposes only, and should not be construed or acted upon as individualized investment advice. Past performance is not indicative of future results. Due to our compliance review process, delayed dissemination of this commentary occurs.
The S&P 500 is an index of stocks compiled by Standard & Poor’s, a division of The McGraw-Hill Companies, Inc. The index includes a representative sample of 500 leading companies in leading industries of the U.S. economy. Indices mentioned are unmanaged and cannot be invested into directly.
Technical analysis represents an observation of past performance and trend, and past performance and trend are no guarantee of future performance, price, or trend. The price movements within capital markets cannot be guaranteed and always remain uncertain. The allocation discussed herein is not designed based on the individual needs of any one specific client or investor. In other words, it is not a customized strategy designed on the specific financial circumstances of the client. Please consult an advisor to discuss your individual situation before making any investments decision. Investing in securities involves risk of loss. Further, depending on the different types of investments, there may be varying degrees of risk including loss of original principal.