I know the shut-down is being relaxed across the country, but most of us are still spending a lot of time at home. Before you fill up your calendar, I have something to add to your quarantine to-do list; the Get-Your-Stuff-Together Notebook.
Creating a notebook can be a tedious process, which is why it rarely gets done. Who has the time to weed through all their papers, compile a list of all your important financial details, then put them together in a somewhat organized fashion? Well, thanks to a global pandemic and a stay-at-home order, you do.
If you’ve ever had to search for documents after a loved-one passed, then you know the importance of having financial information organized and available. You can help alleviate family members’ unneeded stress at this difficult and challenging time.
If you’re interested in taking this on, below are 8 sections you’ll want to include. If you’d rather pick up a book that’s ready to fill in, contact us at (503)387-3222 or [email protected] and we’ll put our Allevi-8 Book aside for you. We have 25 available to give out.
1. Financial Plan
This is a good spot to put your overall financial plan for the future. What are you contributing to retirement accounts? How much are they likely to grow? Any annuities? What about investment property? Inheritances, pensions, social security…. We can help you put one of these together if you’d like.
2. Contacts
Some of the most helpful information a beneficiary/executor could have is to know the professionals you were working with. Contact information for the financial advisor, estate attorney, accountant, and insurance agent, are a few that should be listed.
3. Accounts
This is an important section for obvious reasons. Where are the assets that you’ve accumulated? Not just personal bank and investment accounts, but think about accounts as well that may be more difficult to access. You may want to include the company, account #, type of account, and approximate value. This should be updated at least annually.
4. Insurance
There’s over $1 Billion in life insurance that beneficiaries don’t collect every year because they didn’t know a policy existed. Don’t let this happen to you. Make a list of all the insurance policies (life, disability, long-term care…) you have and include: company, policy, type of policy, and the benefit coverages.
5. Estate Plan
Updating your will or trust is vital to making sure you leave a legacy and not a logjam. Include your will, trust, or leave a note of where to find those documents. This could also be a good spot for a letter with additional instructions for heirs. I wrote a note to my wife, “Uh oh, this isn’t good. If you’re reading this either I’m gone or you’re wishing I was!”
6. Taxes
After someone is gone, there’s a final tax return that needs to be prepared for their estate. Having past tax returns can be helpful for an accountant to complete this. Consider keeping a copy of your last few years of returns in this section.
7. Real Estate
Real estate is often the largest asset for an individual or family. This is a great spot for the deed/title, mortgage statements, and leases for an investment property.
8. Other
This is like the junk drawer for all the random stuff you didn’t put in earlier sections. Here are some ideas to include: passwords, car titles, business information, pet information, spare keys… The list goes on…
Once you’ve completed this, duplicate it electronically and store it in the cloud. Information in these cloud folders can be shared with anyone you desire.
Now, get organized, create a plan, alleviate your loved-ones-stress, and get-your-stuff-together.
Stock Portfolio Changes
We’ve made a few changes in our Stock Portfolio in the last few weeks. We received great news from quarterly earnings reports from the South-American Amazon, Mercadolibre MELI, and cybersecurity firm Fortinet FTNT last week. Both were up greater than 20% in one day!
To celebrate the good performance, we sold some other stocks we bought during the downturn to raise cash; Target TGT and Home Depot HD got the boot out of the portfolio after approximately a 15% gain each. We also sold payment processor Square SQ after a puzzling 10% gain in one day after showing a terrible loss in the first quarter.
After making the sales, we bought a small position in the video call company Zoom Video Communications, Inc. ZM, anticipating a better than expected earnings report in June. The stock is up 18% since we bought it just two weeks ago.
It’s extremely challenging to outperform the stock market, but that’s what we’ve been trying to do in this portfolio. The stock market is now down approximately -8.5% for the year but the Stock Portfolio is positive by several percent (depending on the particular portfolio) over the same time period.
We’re so thankful to the advice of the people we follow at Morningstar, Motley Fool, Jim Cramer, and Barron’s for helping us achieve this! We’ll hope it continues!
Fund Portfolio Changes
We’re still holding a big position in a technology fund, First Trust Internet Fund FDN, in the Fund Portfolio we bought during the downturn. It has a 15% gain so far and we will likely sell at some point in the near future if the stock market continues to go higher.
If we see a “second wave” of the virus, the stock market will pull back and we will use some of the 15% cash we have to buy yet again.
We hope everyone is safe and sound and we look forward to talking soon. Until then, please let us know if we can do anything for you.
– Bruce Porter & Tim Porter, CFP®
