Understanding Credit Reporting

Understanding Credit Reporting

Historically low interest rates present a welcome opportunity for many homeowners to improve their financial situation by refinancing their mortgage.  But, like everything else in the world of finance, there are no free lunches.  To take advantage of these lower rates, homeowners must leap the FICO hurdle.
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A preview of the SECURE Act

A preview of the SECURE Act

A preview of the SECURE Act

a new retirement bill out of the House of Representatives
Let's Talk!

A preview of the SECURE Act, a new retirement bill out of the House of Representatives.

Earlier this year, the House of Representatives passed a new bill called the Setting Every Community Up for Retirement Enhancement Act, aka the SECURE Act. (Acronyms are kind of a thing in Congress.) As the name implies, the bill has important ramifications for people’s retirement savings. In this letter, we want to give you a preview of what the bill is designed to do.

Now, before we do that, it’s important to note that the SECURE Act must first be passed by the Senate and then signed by the president before it actually goes into effect. Many things in the bill could change before that happens, though, so it’s impossible to know exactly what the final law will look like. And of course, it’s always possible the Senate could choose not to pass the bill, or make so many changes that the House decides to rework their version.

That said, the SECURE Act enjoys bipartisan support. In fact, only three members of the House voted against it, with 417 members voting for.1 So it’s expected the Act will become law sometime soon. As your financial advisors, it’s our job to get familiar with the bill now so we can help you prepare for the changes it will bring.

What is the SECURE Act?
The SECURE Act does many things, but at its core, it’s designed to help more Americans save for retirement. Many of the bill’s provisions are designed specifically for businesses, which we won’t get into at this time.  But there are also provisions that impact regular individuals, including pre-retirees, the recently retired, and even their children. None of these changes are particularly dramatic, but they are important nonetheless.

Changes to IRAs and 401Ks2
One of the changes the bill makes is lengthening the time people can contribute to their IRAs. Currently, retirees can only contribute to an IRA up to age 70½. Once they hit this milestone, they are required to begin making withdrawals, called required minimum distributions. Under the SECURE Act, that age would increase to 72. That means retirees have an additional 18 months to benefit from the tax advantages that come with IRAs.

Another change the bill makes is for new parents. Under current law, you must be 59½ years old to make withdrawals from a traditional IRA or 401k. If you withdraw money earlier than that, you would have to pay a penalty of 10% on the amount you took out. There are a few exceptions, such as if you need the money to pay large medical bills, buy a home, or manage a disability. But, generally speaking, the government wants the money you contribute to your retirement accounts to be saved for retirement.

Under the SECURE Act, new parents will also be able to withdraw funds penalty-free. This is to help cover birth and adoption expenses, and it’s especially helpful for younger parents who have high deductible insurance plans. There is a $5,000 cap on withdrawals, though, and they would need to be made within one year of the birth or adoption.

Changes to inherited IRAs2
Another important change – especially from an estate planning perspective – regards inherited IRAs. For years, one of the more popular estate planning strategies has involved the use of Stretch IRAs. When a parent or grandparent dies, they can leave their IRA to their children, grandchildren, or other heirs. Under current law, the beneficiary can take distributions from their inherited IRA based on their official life expectancy. This allows them to “stretch out” the value of the IRA – and the tax advantages that come with it – for a longer period of time. For example, if a 50-year old with a life expectancy of 85 inherited her mother’s IRA, she could stretch out her distributions over the next 35 years.

If the SECURE Act goes into law, this will no longer be possible. Instead, the beneficiary must take out 100% of the IRA’s assets within 10 years of the original owner’s death. As distributions are taxable income, this could have a major impact on the beneficiary’s tax situation.

Planning ahead
As you’ve probably guessed, this topic is important to all of our clients. Some are older, some younger; some nearing retirement, some far away; and some already there. That’s because, while no single provision will affect everyone, almost everyone will be affected in some way.

As mentioned earlier, the SECURE Act has not yet become law, and it’s uncertain when the Senate will vote on it. That said, it’s important that we start planning ahead. If you have any questions about the SECURE Act, please let us know. Otherwise, we’ll make a point to go over any provisions that affect you the next time we have an account review.

If any of the changes you just read about don’t affect you, but could affect someone you know, please share this letter with them. Or, please let us know so we can reach out to them if and when the bill becomes law. As your financial advisors, we want to ensure you’re prepared for any changes coming down the pike – and we want to ensure your family is prepared, too.

We will keep a close eye on Washington as this bill makes its way through Congress. As soon as the situation is clearer, we will let you know. As always, please let us know if there is ever anything we can do for you.
Have a great month!

1 “Congressional Leaders Want SECURE Act Passage in 2019,” Plan Sponsor, October 7, 2019. https://www.plansponsor.com/congressional-leaders-want-secure-act-passage-2019/
2 “Text of H.R. 1994,” Congress.gov, 6/3/2019. https://www.congress.gov/bill/116th-congress/house-bill/1994/text

Are you looking for a financial advisor?  Do you feel confident about your retirement account decisions? Business owner looking for a company 401K plan administrator? Or an athlete or high net worth individual needing long term financial planning advice? Research Financial Strategies can help. We are here to help you design a financial strategy that is molded specifically for you. One that changes as your life changes. Financial investments to help you live worry-free now and in the future.

In our experience, we’ve found that the most successful solutions begin by asking the right questions.
We gain a broader perspective of your goals and the future you wish to create

Today is a Good Day to Start Your Financial Plan

1. We Listen

Our focus is on your life and priorities. Not just your portfolio. That’s why we start by listening and learning about you. Each individual client has different needs and concerns that need to be addressed. We carefully listen to those concerns. We will gain important information that will help us to best serve our clients and help protect their financial futures.

2. Plan

Together we will work to implement the plan that was developed for you. We will keep you constantly updated on what is happening and evolve our plan as your life happens.
Above all, our advisors want to help you meet your goals, even if that means helping you find out what your goals are.

3. We Take Care Of The Rest

We are here for you whenever you need us. Call your Research Financial Strategies Financial Advisor at any time, for any reason. You will always have access to the guidance you need whether it is high tech, high touch or a combination of the two. Your personal Financial Advisor will help you figure out how to pay for life’s great adventures!


Ready to Make a Change?

With an “education first” approach, Research Financial Strategies ensures that our clients understand how their money is being invested, and we guide the development of financial plans that help them achieve their goals for personal wealth and retirement security.

How Can We Help?

Annuities, Potomac, Annuity, Bethesda,  Annuity Advisor, Rockville, 

Market Commentary – November 25, 2019

Market Commentary – November 25, 2019

Thanksgiving is in the air!
On Thursday, U.S. investors may find themselves giving thanks for the bull market.

Year-to-date, the Standard & Poor’s 500 Index, Dow Jones Industrial Average, and Nasdaq Composite have all gained more than 20 percent with dividends reinvested. The MSCI World Index also is up 20 percent year-to-date.

Bond markets have rallied, too. U.S. government bond yields have dropped since January, and prices have risen. Not all asset classes have packed an oomph, but investors are feeling optimistic, reported Michael Mackenzie of the Financial Times.

Ben Levisohn of Barron’s expressed some skepticism about the current level of optimism.

“If you believe the current narrative, everything is right with the world. By cutting interest rates three times, the Federal Reserve has averted a recession. And with the U.S. and China slowly making progress on a trade deal, capital spending could revive and boost the economy. And right on time, the S&P 500 index hit a new all-time high, seemingly confirming this rosy narrative…Strangely, market sentiment appears to be getting better even as the economic data appear to be getting worse.”

He’s not wrong. Economic data suggest U.S. and Chinese economies have begun to experience negative effects related to the two-year-old trade war. Reuters reported economic growth in China has slowed to a 30-year low. Growth in the United States has slowed, too.

While many remain optimistic about progress in resolving the U.S.-China trade dispute, Barron’s Nicholas Jasinski spoke with the chief investment officer of an international wealth management firm, who commented, “Our view of U.S. and China is that it’s a competition that’s going to go on for a generation economically, diplomatically, militarily.”

Last week, major U.S. indices finished lower on concerns about trade talk progress.

Happy Thanksgiving!  We’re thankful for you.

Why do presidents pardon turkeys?
A turkey may not be on the Great Seal of the United States, as Ben Franklin would have preferred, but the bird has a surprisingly robust history at the White House.

From the 1870s until 1913, turkeys were provided to the White House for holiday meals primarily by Rhode Island poultry producer Horace Vose. After his death, it was a free for all.  The White House Historical Association wrote,  “By 1914, the opportunity to give a turkey to a President was open to everyone, and poultry gifts were frequently touched with patriotism, partisanship, and glee. In 1921, an American Legion post furnished bunting for the crate of a gobbler en route from Mississippi to Washington, while a Harding Girls Club in Chicago outfitted a turkey as a flying ace, complete with goggles. First Lady Grace Coolidge accepted a turkey from a Vermont Girl Scout in 1925. The turkey gifts had become established as a national symbol of good cheer.”

The first time a turkey was granted clemency was in 1863. President Abraham Lincoln instructed the White House staff to spare a bird which had become a favorite of his son, reported the Constitution Daily.

Some say President Truman pardoned a turkey or two, but the Truman Library does not agree.

Records indicate it was 1963 before another President spared a turkey destined for the White House kitchen. While both President Lincoln and President John F. Kennedy showed mercy, neither officially pardoned their birds. President Ronald Reagan joked about a pardon, but the first official Presidential turkey pardon was issued by President George H.W. Bush in 1989.

So, why do Presidents pardon turkeys? We’re not really sure. We know where pardoned turkeys go, though.

For many years, like Super-Bowl-winning quarterbacks, they went to amusement parks in Florida and California. The turkeys helped lead Thanksgiving Day Parades. More recently, “…the spared turkeys are sent to an enclosure at Virginia Tech called ‘Gobbler’s Rest’… where they get to frolic with other free turkeys,” reported The Independent.

Weekly Focus – Think About It
You may have heard of Black Friday and Cyber Monday. There’s another day you might want to know about: Giving Tuesday. The idea is pretty straightforward. On the Tuesday after Thanksgiving, shoppers take a break from their gift-buying and donate what they can to charity.”
— Bill Gates, Business magnate and philanthropist

Best regards,

John F. Reutemann, Jr., CLU, CFP®

P.S.  Please feel free to forward this commentary to family, friends, or colleagues. If you would like us to add them to the list, please reply to this email with their email address and we will ask for their permission to be added.

Investment advice offered through Research Financial Strategies, a registered investment advisor.

S&P 500, Dow Jones Global ex-US, Gold, Bloomberg Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; the DJ Equity All REIT Total Return Index does include reinvested dividends and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.
Sources: Yahoo! Finance, Barron’s, djindexes.com, London Bullion Market Association.
Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.

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* This newsletter and commentary expressed should not be construed as investment advice.
* Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value.  However, the value of fund shares is not guaranteed and will fluctuate.
* Corporate bonds are considered higher risk than government bonds but normally offer a higher yield and are subject to market, interest rate and credit risk as well as additional risks based on the quality of issuer coupon rate, price, yield, maturity, and redemption features.
* The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. You cannot invest directly in this index.
* All indexes referenced are unmanaged. The volatility of indexes could be materially different from that of a client’s portfolio. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. You cannot invest directly in an index.
* The Dow Jones Global ex-U.S. Index covers approximately 95% of the market capitalization of the 45 developed and emerging countries included in the Index.
* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.
* Gold represents the afternoon gold price as reported by the London Bullion Market Association. The gold price is set twice daily by the London Gold Fixing Company at 10:30 and 15:00 and is expressed in U.S. dollars per fine troy ounce.
* The Bloomberg Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.
* The DJ Equity All REIT Total Return Index measures the total return performance of the equity subcategory of the Real Estate Investment Trust (REIT) industry as calculated by Dow Jones.
* The Dow Jones Industrial Average (DJIA), commonly known as “The Dow,” is an index representing 30 stock of companies maintained and reviewed by the editors of The Wall Street Journal.
* The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system.
* International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.
* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.
* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.
* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.
* Past performance does not guarantee future results. Investing involves risk, including loss of principal.
* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee it is accurate or complete.
* There is no guarantee a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
* Asset allocation does not ensure a profit or protect against a loss.
* Consult your financial professional before making any investment decision.
* To unsubscribe from the Weekly Market Commentary please reply to this e-mail with “Unsubscribe” in the subject.

https://www.barrons.com/articles/dow-jones-industrial-average-snaps-four-week-winning-streak-51574469902?mod=hp_DAY_3 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/11-25-19_Barrons-The_Dows-Winning-Streak-Ended-With-a-Whimper-as-Trade-Worries-Return-Footnote_1.pdf)
https://www.ft.com/content/0d445fe2-0c60-11ea-b2d6-9bf4d1957a67 (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/11-25-19_FinancialTimes-Investment-Outlooks-Hinge-on-Deciphering-Conflicting-Signals-Footnote_2.pdf)
https://www.cnbc.com/2019/11/18/the-bond-phenomenon-of-2019-isnt-over-yet-says-trader.html (or go to https://peakcontent.s3-us-west-2.amazonaws.com/+Peak+Commentary/11-25-19_Barrons-The-Bull-Market-Could-Still-End-in-2020-Here’s-How-to-Prepare-Footnote_3.pdf)

Thanksgiving 2019

Thanksgiving 2019

Happy Thanksgiving!

Nine things to be thankful for as a financial advisor
We're Here For You!

Happy Thanksgiving!  We hope you have a wonderful day spent with family, friends, and great food.

As you know, Thanksgiving is a time for reflecting on all that we have to be thankful for. It occurred to us the other day that, as your financial advisors, we’ve never shared what we are thankful for. And we are thankful for a lot. 

So, if we can beg your indulgence, please allow us to share:

Nine things we are thankful for as your financial advisors

  1. Our country
    We’re thankful we live in a country where we have the freedom to set our own goals, choose our own paths, and pursue our own happiness. There are millions of people in the world who don’t have this freedom – a freedom we strive never to take for granted.
  2. Our military
    We’re thankful for the thousands of brave men and women who strive to protect that freedom, along with all the other unalienable rights we enjoy.
  3. Our community
    As financial advisors, we have come to know many different members of our community, including people from all walks of life. While no community is perfect, we truly believe ours is as beautiful, unique, and worth participating in as any in the world. We are lucky to live here – and we are thankful we do!
  4. Our modern world
    While sometimes it seems like modern technology causes as many problems as it solves, in our case, it has enabled us to help more people better – and faster! The fact that we can speak with you over the phone, send you an email or monitor your investments with just the push of a button is amazing. There’s more power in our cell phones than in the spacecraft that took Neil Armstrong to the moon – and that power is something we’ve come to rely on every day.
  5. Our health
    As financial advisors, one of the most important things we do is help people be secure financially so they can take care of themselves physically. It’s helped us become more appreciative of our own health. The simple fact we can leave our homes and go to work every day is no small blessing.
  6. Our job
    We are thankful we have a job that enables us to support our family and pursue our passions. We are thankful our jobs are our passions. Not everyone enjoys going to work every day. Not everyone has the opportunity to do what they love. But we do, and we will never stop being grateful for it.
  7. Our team
    While we all strive to be as self-reliant as possible, the fact is that no one succeeds in life without the help of others. That’s why we are so thankful for our amazing team. There has never been a group of people more dedicated and professional. We wouldn’t be where we are without them.
  8. Our families
    The older we get, the more we realize that family is what matters most in this life. A loving, supportive family is the richest fortune anyone can have, and in that regard, we are each rich indeed. In good times and bad, it’s our family who have cheered us on, propped us up, and pushed us forward. We love and cherish them all.
  9. Our clients
    We are thankful for you. Do you have any idea how lucky we are to work with clients of your character? How humbled we are to be entrusted with your financial success? How honored we are to help you in any small way we can?

The truth is, there are lots of people in this world we would not want to work with. But when we look through our list of clients, we are staggered. We have the privilege of serving some of the smartest, kindest, most decent human beings anyone has ever met.

People like you are why we do what we do. You’re the reason we never hit the snooze button. The reason we are happy to burn the midnight oil. There aren’t words to express how thankful we are for your business. For your trust. For your kindness. For you.

In other words, we are thankful to be your financial advisor. On behalf of our entire team, we wish you a Happy Thanksgiving!

How Can We Help?

Annuities, Potomac, Annuity, Bethesda,  Annuity Advisor, Rockville, 

Will There Be A Recession?

Will There Be A Recession?

Will There Be A Recession?

Are you prepared?
Let's Talk!

The simple answer is probably.  
Historically, the American economy has grown in fits and starts, otherwise known as recessions and expansions. As a result, it is likely there will be another recession in the United States.

What are recessions? When gross domestic product (GDP), which is the value of all goods and services produced in the United States, declines for two consecutive quarters, many people will say the economy is in a recession.1

Typically, during recessions, unemployment rises, consumer income declines, consumer spending falls, and industrial production and manufacturing slow down.2

The last recession began in 2007 and ended in 2009. It lasted for 18 months, and was the longest recession since World War II.3

What are expansions? An expansion begins when GDP begins to grow again. Usually, during expansions, unemployment declines, consumer income increases, consumer spending grows, and industrial production and manufacturing accelerate.2

The current expansion began in June 2009. It is the longest expansion in the history of the United States.3, 4

 It’s important to note that during recessions and expansions, there may be brief reversals. For example, a recession may include a period of growth before the economy declines further, and an expansion may include a period of decline before the economy grows more. Usually the beginning of a recession or an expansion isn’t identified until well after it has occurred.1

When will there be a recession?
There is no simple answer to this question.

The causes of recessions are not always easily recognized, reported Robin Harding of Financial Times. When a threat to economic growth is observed, policy makers or central bankers often take action to minimize it.5

Recent recessions have been caused by unanticipated financial crises. In 2001, the bursting dotcom bubble sparked recession. In 2007, mortgage loan defaults and the housing crisis were the catalyst.5

The longevity of the current expansion has many investors worried about the chances of recession. However, as previous Federal Reserve Chair Janet Yellen commented, “I don’t think expansions just die of old age.”6

Despite the inverted yield curve*, which can be a recession signal, Harding wrote:5  “There are some signs we are late in the current cycle. Asset valuations are high by historic standards. Private debt has risen a lot in China and some peripheral economies. The Trump administration is rolling back financial regulation. It all increases risk. But the signs of stress that often precede a crisis – wild ebullience or rising defaults – are not obvious.”

In July 2019, the Federal Reserve Bank of New York estimated the probability of a recession in the United States by July 2020 at 31.5 percent.7

Fortunately, recessions tend to be far shorter than expansions. The United States has experienced 11 economic cycles – contractions followed by expansions – since 1945. The average length of recessions has been about 11 months. The average length of expansions has been 4.8 years.3

What will the stock market do?
Stock markets reflect investors’ expectations for the future. As a result, they tend to fall before a recession begins and rise before a recession ends. It’s not a very useful pattern because market volatility makes it very difficult to recognize when a market decline signals recession ahead and a market gain signals recovery.

No matter what the stock market does, it’s important for investors to implement strategies that will help them remain calm when markets are volatile. Here are four tips to help you stay focused on your goals when markets are turbulent:

  1. Keep your perspective. They may be uncomfortable, but stock market downturns are normal. Historically, markets have regained losses suffered during downturns and moved higher.8
  2. Choose the right amount of risk. When stock markets deliver strong returns, it can be tempting to invest in stocks more heavily. Before you do, remember more stocks means higher volatility. Choose a portfolio allocation that will let you stay calm during periods of volatility and market downturns.
  3. Take time to rebalance. The performance of markets can affect your portfolio allocation. If the stock market does well and the bond market poorly, you may end up with more risk than intended. Rebalancing preserves your allocation.
  4. Downturns may create buying opportunities. The silver lining behind the dark cloud of recession is you may be able to invest in strong companies at low share prices.
  5. Remember your goals. We spend a lot of time helping clients identify life and financial goals and then designing portfolios to help pursue those goals. The stock market may head south, but that doesn’t mean your goals have changed. Remember why you’re investing.


If you’re nervous about financial markets and would like to discuss what’s happening or just be reassured, give us a call. We’re happy to talk with you.

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For over 25 years, Research Financial Strategies has been serving Ashburn Virginia families and businesses as their financial advisor.  Let us put our money management expertise to work for you.  Set up a no obligation consultation by either filling out our contact form or by calling us at 301-294-7500.  We are here for you Ashburn!


We are dedicated to helping you protect and manage your assets, prepare for retirement and life’s events, and develop a legacy that benefits your loved ones and future generations. As your financial partner, we listen and respond to your needs using clear, simple language. We offer personal service, seek to develop innovative strategies, and pledge to lead you with great care along the path to pursuing your goals.