An article from Financial Advisor magazine published on February 24th featured Marc Scudillo discussing the Russian invasion of Ukraine and its effects on markets.
While investors are not panicking over the invasion of Ukraine by Russia and the resulting market volatility, some have questions, according to advisors who discussed clients’ reactions in late February.
Marc Scudillo, managing officer of EisnerAmper’s wealth management and corporate benefits practice, said he has been getting questions from clients about the events in Ukraine. “They want to know how far the situation will go and what it means for them,” Scudillo said. “There are heightened emotions but we assure them we understand their concerns and they are not going to be down 10%, like the general market. We tell them our planning has set them up to react to both good and bad markets.”
Some of EisnerAmper’s clients even want to know how they can take advantage of the downturn in the market. “They said they have been wary of buying when the market was so high and they want to know how to use the crisis. They have confidence” in their planning, Scudillo says.
Some economic experts at universities are also encouraging advisors to advise clients to hold their positions, stating opinions like Putin has overreached and that markets could rebound before the crisis is over. There are varying opinions about how to invest during this crisis. Some say investing in the Russian market can be risky because so many companies are state-owned. Others believe the energy sector is likely to see movement following the invasion. The invasion may keep inflation high and inflation may become a global issue.
But it’s also possible the Federal Reserve will slow its increase of interest rates, or even bring rates down, benefiting stock valuations. When the crisis does end, this could help lower fear and drive markets back up, limiting its impact over the course of time.
If you have any questions about how EisnerAmper Wealth Management & Corporate Benefits can help protect and grow your portfolio regardless of economic conditions, please contact us: https://eisneramperwmcb.com/
Read the entire article here:
Marc Scudillo is the managing officer of EisnerAmper Wealth Management and Corporate Benefits LLC (www.eisneramperwmcb.com). He is a certified public accountant and a Certified Financial Planner™ and Certified Business Exit Consultant®.
Both, ERISA and the IRS requires that DC plan loans reflect a “reasonable rate of interest”.
So much about financial wellness has to do with cultivating a mindset that favors delayed versus immediate gratification. In the language of behavioral economics, the tendency to prefer short-term rewards is called hyperbolic discounting. This often leads to more impulsive decision-making, and it can feed excessive personal debt and hamper retirement readiness over time, whereas those (typically in the minority) who will wait for a larger reward are frequently described as “present-based.”
While in this study the “cost” of impatience was limited to $26, employees that struggle with delaying gratification and prioritizing saving for the future will no doubt pay a much higher price. They may need to remain in the workforce longer. They’ll also likely experience higher levels of stress, especially as they approach the date they hoped to retire by. They may also accrue excessive debt, which may adversely impact their standard of living — especially during their golden years.
According to Forbes, building a culture of gratitude in the workplace has a tremendous upside — for both workers and employers. Employees tend to find working in a more grateful environment a more positive and rewarding experience. And being appreciated by people other than one’s supervisor can provide a boost in morale. Teamwork is encouraged even as it exists alongside healthy competition. And while all of these organizational benefits take hold, it turns out that you may also be helping workers with their long-term financial decision making.
Per the DOL, plan sponsors should ask the service provider about the following:
Michael Abate, AIF®, CRPS®
While one could say it’s always a good idea to focus on well-being of any type — whether that’s physical, mental, or financial wellness — there’s perhaps never been a more important time to help employees improve their financial literacy, behaviors, and resilience than right now.
1. Ongoing fiduciary training and education. Fiduciary committee members take on significant risk for their service. And even though there are no specific job titles or requirements to participate on a retirement plan committee per ERISA — such as being a financial or human resources officer, it’s vital that committee members be prudently appointed and that only individuals qualified for the role take on this responsibility. They should have an understanding of ERISA fundamentals and the workings of retirement plan structures and operations. But perhaps most importantly, members must have a commitment to working solely for the interests of plan participants and beneficiaries. The functioning of the committee can be further strengthened with ongoing continuing education on fiduciary responsibility and training to keep members abreast of any regulatory or other ERISA, DOL or IRS changes that could impact the retirement plan they oversee. Schedule regular training — perhaps quarterly — and consider fiduciary liability insurance to provide an added layer of protection for members, whose performance should be closely and regularly monitored.
Upon becoming eligible to participate in your company’s 401(k) plan, participants are asked to select investments, contribution rate and to indicate a beneficiary designation. This is obvious and it is likely that an application would not be accepted unless this information was completed. What is often less obvious is the need to update beneficiary designation in event of significant life changes acknowledging that their 401(k) assets may not then coincide with the terms of a will addressing other assets.
