LAKESHORE FINANCIAL PLANNING QUARTERLY NEWSLETTER
IN THIS ISSUE The Big Picture with Jeff Brayton
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Book Recommendation
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Quote of the Quarter Financial Planning with Mark Romin Investment Management with Brennan Ifkovits Office News and Events
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Team Updates
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YOU’RE INVITED TO OUR
HOLIDAY PARTY
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Jeff Brayton-Senior Advisor Mark Romin, CFP®-Senior Advisor Pat Johnson-Chief Compliance Officer Kapre Wilseck-Client Operations Associate Tina Houle-Client Service Associate Brennan Ifkovits-Portfolio Analyst
October 2021
Thursday, December 2nd, 2021 5:00 – 5:30 Drinks 5:30 – 8:00 Dinner Assumption Cultural Center 21800 Marter Road St. Clair Shores, MI 48080 PLEASE CALL OR EMAIL TINA FOR RESERVATIONS (586) 498-0788 TINA.HOULE@LAKESHOREFINANCIALPLANNING.COM
23201 Jefferson Avenue St. Clair Shores, MI 48080 (586) 498-0788 lakeshorefinancialplanning.com
THE BIG PICTURE WITH JEFF BRAYTON
“I see all this progress, and it fills me with conviction and hope that further progress is possible. This is not optimistic. It is having a clear and reasonable idea about how things are. It is having a worldview that is constructive and useful.” Hans Rosling Swedish Physician and Author
Mark’s column in our October 2019 newsletter planted the idea of creating a Living Legacy by utilizing accumulated wealth today to create memories with loved ones while we are living. We know of several family vacations planned and taken as a direct result of this advice. I can assure you hearing stories and seeing pictures from these vacations is extremely rewarding for us.
I’ll elaborate on this quote in a moment, but I want to start this section by addressing the purpose and evolution of our quarterly newsletter. Improvement is a word we use a lot in our office. At an educational conference a few years back I heard one of those quotes that stays in your mind long after the session has ended: “You can raise the bar or you can wait for others to raise it; either way it’s going to be raised.” Along with our team, this newsletter continues to evolve with the goal of making it more helpful for you.
This all works well for me because with Mark and Brennan focusing their sections on specific topics of financial planning and investment management, I’m able to concentrate on big picture ideas and trends. I will continue to focus on subjects that may not have an immediate impact on your portfolio or financial plan, but that we believe establish long term context for our outlook and advice to you.
This month our newsletter contains the first Portfolio Management section written by Brennan Ifkovits – our new Portfolio Analyst. Brennan’s section will be focused on specific topics with his analysis and observations on the design and monitoring of portfolios. You can expect his section to be weighted towards the technical side of investments, including areas like sector rotation, asset allocation, diversification and even specific security analysis. Brennan’s section should appeal to you if you’re looking for deeper insight into our investment management strategy and process.
I also believe big picture thinking is important because it impacts our mindset and potentially our behavior. I hope my section will help to keep you focused on larger issues, and not the day to day noise we are bombarded with from all angles. Taken as a whole, we hope our quarterly newsletter helps to inform you and reassure you that our team is continuously monitoring today’s increasingly complex environment. We will also provide you with information on the members of our team and office events. We happen to know that some of you skip
Mark’s section will continue to focus on financial planning. As a Certified Financial Planner™ Professional, Mark is able to provide ideas and details that support our planning strategies. As he has in past issues, Mark will cover areas such as tax and estate planning.
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THE BIG PICTURE WITH JEFF BRAYTON
right past all of our analysis to the team update photos! Again, our goal is always to improve and we are open to your feedback and suggestions.
L. Tupy (this month’s book recommendation). One of the most compelling aspects of the book to me is it was published in 2020 so the data is fresh and current. There are also several refences to the global pandemic which will almost undoubtably impact some trends in the short term.
I began this section with a quote from Hans Rosling, author of Factfulness. Over the course of many years Mr. Rosling has been posing big questions about our world to thousands of individuals. Questions such as this one:
The book starts with 10 global megatrends like Peak Population and Are We Running Out Of Resources. It then covers an additional sixty-eight sub-trends in specific areas like global violence, farming, health and technology.
In the last 20 years, the proportion of the world living in extreme poverty has… A. almost doubled B. remained more or less the same C. almost halved
The final twenty pages of the book are dedicated to trends specific to the United States. I was surprised, and even amazed, by several of the US trends, but the one that stood out the most is titled, Bigger and Better Housing. I think we would all agree that the size of personal living space is an important indicator of human well-being. This is particularly true as we were trapped in our homes for most of 2020!
What he has found is that people in general are massively ignorant (his words not mine!) about the world we live in. The answer to the above question is C, but if you got it wrong you shouldn’t feel bad because of people polled in the US only 5% picked the correct answer. Over the past twenty years, the proportion of the global population living in extreme poverty has halved. You could make an argument that this is the most important change that has happened in the world in our lifetime. How is it that so few of us are aware of this fact?
Yet not long ago it wasn’t uncommon for two or three generations of the same family to live under the same roof, even sleeping together in the only heated room of the house. And if that doesn’t sound uncomfortable enough for you, Americans often shared their living space with their livestock to keep the latter safe from predators and thieves. That’s an awful lot of togetherness!
Hans Rosling discovered that not only are we uninformed about the condition of our world, we are “devastatingly and systematically wrong” about it. This is true across countries, backgrounds, cultures, and levels of education. I believe having at least a semi-accurate big picture world view is important. As I wrote earlier, our world view can influence our psychology and potentially our investment behavior. In short, I think understanding the world as it actually is can potentially make us better investors and decision makers. This thought sent me on a reading binge and the single best book on the topic I could find is Ten Global Trends Every Smart Person Should Know by Ronald Bailey and Marian
Nebraska Sod-House Ranchers: 1880ish Library of Congress, Prints & Photographs Division
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The Spring edition takes u guide for surviving in just a planning.
THE BIG PICTURE WITH JEFF BRAYTON I keep this photo near my desk as a reminder of our progress. This was a typical middle-class family in the 1880’s and the picture would have looked very similar right into the early part of the 20th century. By 1973, writes Mark J. Perry from the University of Michigan, a newly built home averaged 1,660 square feet. In 2017, it averaged 2,631 square feet. The size of our homes and standard of living would appear as science fiction to the family in this photo. And it makes me wonder what our homes will look like fifty or a hundred years from now. The book is full of similar facts and insights, and every trend discussed is supported with data via simple charts and graphs.
I find that occasionally stepping back Many of my friends tell me and looking at the big picture can be a everyone, I believe the refreshing break from the politicaland squabbling and negativity of the daily news.when There are thoughts you can. I a certainly many problems in the world we need to address, and continued progress is never guaranteed. However as Hans Rosling reminds Sincerely, us, “You can’t fix what is wrong in the world if you don’t know what’s actually happening.”
Jeffrey Brayton Financial Advisor Branch Manager
Quote of the Quarter
Book Recommendation
“Problems are part of the human condition, and when they are solved, and barriers are removed, life gets better – and some smart person somewhere usually makes a buck.”
‘Ten Global Trends Every Smart Person Should Know’ Ronald Bailey and Marian L. Tupy This is a quick-to-read and easily understandable guide to a better understanding of how the world is really faring. If you’re like me, it will be full of surprises.
Joel Kurtzman American economist
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FINANCIAL PLANNING WITH MARK ROMIN Tax Changes On The Way
in cost basis rule would see no changes. This would come as a dramatic relief to clients who have held stock positions for many years in taxable accounts or have property in the family dating back decades.
If you are in a high income tax bracket, chances are you’re not going to like the tax package being proposed in Congress. It is possible that the highest tax bracket will increase from 37% to 39.6% coupled with a lower income threshold for the highest tax bracket, namely $400,000 for individuals and $450,000 for married filing jointly. The second change for wealthier tax payers comes as a potential 3% surtax on modified adjusted gross income over $5 million.
There is sure to be a large amount of negotiation before any financial changes are passed. It would be great to have a consistent and easily understandable tax code - that would be a first.
The top capital gains tax rate is proposed to bump from 20% to 25%. This proposal is being written to be retroactive effective to midSeptember 2021, which would help to prevent a year-end sell off.
A big part of our job is to be on top of these changes for you as they relate to your financial plan and to the markets. We are committed to do that and to keep you informed of any adjustments we think are appropriate along the way.
Estate taxes are also possibly on the chopping block to be modified with the per-person exemption reducing to roughly $6 million from $11.7 million. For married couples it drops to $12 million from $23.4 million. As of right now, the much-discussed (at least in our world) step-up
INVESTMENT MANAGEMENT WITH BRENNAN IFKOVITS Lakeshore Financial Planning welcomed me with open arms roughly two months ago, and I’ve felt comfortable since the moment I stepped foot into the office. I have been gradually acclimating myself to the new work environment and I am grateful to have the opportunity to be in the office rather than working from home. Over the course of the last two months, I have introduced myself to many clients, and it’s been an absolute pleasure to finally bring names and faces together. I look forward to meeting you in the near future.
topics that I hope you find fascinating and ultimately helpful. My background and prior experiences are in portfolio analysis and market research, so please be patient if some of my section gets technical or overwhelmingly deep with numbers. From the outside looking in, I have come to realize that portfolio analysis and in-depth number crunching might not always make for thrilling reading. But it’s what I’m passionate about and at the end of the day, my portfolio evaluation should contribute to the goal of improving our overall investment process. I get great personal satisfaction being a part of a team committed to helping you achieve your investment goals and objectives.
I have worked behind the scenes thus far, listening to conference calls and dissecting presentations centered around macroeconomic and market data in an attempt to gather as much information as possible to assist Jeff and Mark in making even better-informed decisions for your portfolio.
I’m eager to write about and dive into
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OFFICE & EVENTS UPDATE
I know fall must be upon us because Kapre was kind enough to bring in a double batch of her award-winning chili. It truly is an award-winning recipe, and Kapre has her trophy from a Raymond James-sponsored cook off to prove it! Our entire team agreed that this year’s batch is every bit as good, if not better, than last year’s. Maybe we should sponsor our own chili cook off?! I can tell you Kapre’s chili would be tough to beat.
Did you notice our team cover photo includes Brennan Ifkovits? Brennan joined us in August. He has fit right in with our culture and is already providing us with detailed portfolio analysis. He and Mark have a friendly golf rivalry going, while I have to be content being the third best (i.e., worst) male golfer in the office. It’s great having Brennan on board and we believe he will be an important part of our team for years to come.
We decided to take a half day in August to head to Comerica Park for a Tiger’s game. It was a perfect summer afternoon, and the Tiger’s scored 10 runs (unfortunately, the Angels scored 13!) After missing last year, we do plan to host our annual holiday party on December 2nd at Assumption. We hope you can join us for what has traditionally been a fun evening with great food and drinks.
Thank you for taking the time to read our newsletter and for your continued trust and confidence.
Jeff Brayton, Mark Romin & Brennan Ifkovits
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Team Updates Jeff Brayton
Mark Romin
Kapre Wilseck
Pre gaming before a Tigers game with Lauren and Danielle and our future son and daughter-in-law
Friday night football with Emma
Up north on the Betsie River for a family vacation
Up north with friends from Houston and Kansas City
Dinner with Lauren and Yara in Cape Cod in July
Tina Houle
Celebrating Mark’s birthday
Brennan Ifkovits
Tina and her husband Brian celebrating their 10 year anniversary With buddies on Higgins Lake
Grandsons Liam and Crosby enjoying Liam’s 4th birthday gift, a new power wheels truck
Cheering on the Romeo Bulldogs
Brennan golfing with his dad and brother in St. Joseph, MI
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Pat Johnson
Celebrating the newly married couple
Celebrating Danielle & Tyler’s wedding
Congrats Tim! MSU grad
Lakeshore Financial Planning 23201 Jefferson Ave St Clair Shores, MI 48080
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