COVID-19 and Personal Bankruptcy for Small Business Owners

Our Clients generally are not needful of this relief, or appropriate candidates for it—but we felt this is very important for the community to know, and to pass on.  I have a long relationship with Andy, and consider him a wonderful resource. 4/16/2020  Author: Andrew M. Thaler Esq. Most small business owners unavoidably have to either incur business debt in their own name (think of an American Express Card) or personally guarantee business debt. The Coronavirus has had a devastating effect on small business.  Many small businesses will simply not be able to weather the storm and survive. In this scenario, an inability of non-operating companies to pay its debts will leave small business owners with personal liability on business debt. Now is the time […]

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Deferrals of Insurance Premium Payments in NYS

From the NYS Dept of Financial Services— Regulations will be issued in the near future allowing consumers and small businesses experiencing financial hardship due to COVID-19 to defer paying health insurance premiums through June 1, 2020. Details will be available once the regulation has been issued. Consumers experiencing financial hardship due to COVID-19 may defer paying life insurance premiums for 90 days. Consumers and small businesses experiencing financial hardship due to COVID-19 may defer paying premiums for property and casualty insurance for 60 days Premium finance agencies are required to provide same relief as insurers.

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Observations on Life Insurance Companies and Products

I saw this list (excerpted) of observations from a Life Insurance sales person, and it is worth looking at, keeping in mind the sales oriented goals: Will Life Insurance Policies Pay Out on Death from a Pandemic?   Individual life insurance policies DO NOT EXCLUDE deaths from a pandemic. Some Employer provided life insurance policies MAY EXCLUDE pandemics, war and terrorism. How Will Insurers’ Financial Health Be Impacted By The Corona Virus? Life insurance company portfolios are actually impacted negatively due to increased Death claims from the coronavirus but are positively impacted from the elimination of annuity payouts on the death of annuitants. Are Life Insurers Still Able to Conduct Physicals for New Policies? YES.  And, Some companies have Eliminated the need for Physicals for […]

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Planning in a Disaster

We appear to be entering a new and terrible phase of this nightmare, where access to adequate health care becomes impossible in an overloaded system.  Our dread and anxiety become compounded by uncertainty about how long this phase could continue–hopefully just weeks, and not (many) months. Many of our friends, neighbors and our clients have the resources to withstand the loss of work, business, and income.  The sadness we feel for those who do not is a hard burden to bear, and we hope you all find ways to help and support those whose families are truly upended and ruined.  It is difficult to think that beyond our own communities, lay even more vulnerable populations, in dense Brazilian Favelas, slums in India, or overcrowded refugee […]

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Two Risks in Retirement Planning that are Frequently Ignored

Retirees experience heightened vulnerability to “sequence-of-returns risk” once they are spending from their investment portfolio.  Poor returns early in retirement can force the sustainable withdrawal rate well below what is implied by long-term average market returns.  The returns experienced near your retirement date matter a lot more than most people realize.  Retiring at the start of a bear market is incredibly dangerous.  You might enjoy positive average market returns over 30 years of investing, but if negative returns are experienced in the early stages when you start spending from your portfolio, wealth can deplete rapidly through withdrawals, leaving a much smaller nest egg to benefit from any market recovery, even with the same average returns over a long period of time. Retirees face the risk […]

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Be Careful Relying on Online Retirement Calculators

The Wall Street Journal highlighted a recent academic study at Texas Tech University WSJ Article, Damato & Tergesen that found the results misleading and incorrect in two thirds of the thirty six free or low cost tools which the researchers tried.  In the examples highlighted, the online calculators significantly overstated the level of confidence which the data indicated would be safe for a secure retirement. The researchers recommended being careful to avoid oversimplifying a process which requires commitment and effort to 1) provide an analysis that suits your individual circumstances and needs, and 2) understand the strengths and weaknesses of results obtained, and how to use them wisely. The Will Doctor notes that our growing faith and dependence on automated simple solutions to complicated lifestyle questions is […]

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Assumptions for Risk and Investment Returns

The effectiveness of any effort to assess your future financial security depends on using assumptions about many variables.  These include your life expectancy, saving and spending levels over time, inflation, and hypothetical investment returns on your savings.  Each variable must be considered very carefully, and the results need to be viewed under multiple scenarios.  This gets complicated, especially since there are competing methodologies about how to build the variables, and much of this guesswork is getting more scientific (and accurate) on a daily basis. Of course, it is very obvious to everyone that there will be a lot of room for disagreement about future investment returns, depending on how the computations are made, and the weight of historical returns over different time periods.  Bessemer Trust […]

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John Lennon on Planning

Just ran into this quote-it’s becoming more true, every day: “Life is what happens while you are making other plans.” In the 21st Century, assumptions that are required for prudent analysis of our future financial security, and the attendant recommendations, becoming much harder to stand behind.  Someone famous once called these “known unkowns”.  Consider the following: Geopolitical risk Theological/religious conflict Terrorism Vastly increased mobility and ability to change domicile/vast refugee migrations The emergence of global citizens not tied to specific nationalities Globalization of Trade vs. Inceased Protectionism Currency fluctuations (often expressed in martial terms) The digitization of work and commerce and everything Automation of professional services Technology and the Internet Digital privacy, security and Cyberwarfare Increased Longevity Changing gender and sexual identities The rise of […]

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