Practical Tips & Insights for your Best Financial Life

Bottom Line:

 - The essential or most important point

 - The final line of a financial report 

 - The ultimate outcome

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How to Avoid an IRS Penalty: IRA Contributions & 529 Withdrawals

“I’ll pay extra taxes" said no one ever.  

The IRS levies penalties – even for honest mistakes, such as an excess IRA contribution or 529 withdrawals exceeding qualified educational expenses.

“But I didn’t intend to…” will not result in the IRS waiving the 6% or 10% penalty for not adhering to often-confusing rules on contributions and withdrawals.


To avoid a penalty, understand the rules and consult with a tax and financial professional to take the right steps and correct any mistake.


What is an excess IRA contribution? 

Anything which is not an allowable contribution as defined by the IRS.

Traditional IRA

Allowable contributions

     $5,500 in under age 50 in 2016

     $6,500 if age 50 or over in 2016

Excess contributions (besides the obvious greater than permitted dollar amount)

     You (or your spouse) did not have taxable compensation from an employer or self- employment income

     You (or your spouse) is age 70 ½ or older

Roth IRA

Permitted contributions phase-out based on income and tax filing status

        Single Filer: $117,000-$132,000

        Married filing jointly: $184,000-$194,000

6% Penalty each year until removed 

An excess contribution will be assessed a 6% penalty – not once, but each year the excess contribution remains in the IRA.

When to Correct  

It is best to correct your excess contribution as soon as possible to minimize the assessed penalty.   

The deadline for correcting 2016 excess contributions is October 16, 2017.

Although the deadline is not until October, if you correct before filing your 2016 tax return you may avoid having to file an amended return, and may even be able to roll the excess contribution forward.

How to Correct  

1. Withdraw the contribution and any attributable earnings or loss. Any earnings will be subject to the 10% early distribution penalty if you are under age 59 ½; 

 2. Re-characterize the contribution. Simply put, transfer the contribution amount (plus earnings or loss) from a Roth to a Traditional IRA or vice versa.  Re-characterizations are not taxable or subject to penalty.

Which Method to Use

This is where having a relationship with a trusted advisor becomes critical, as the answer depends on the facts of your individual situation.

If you have no taxable compensation, for example, and made a traditional IRA contribution, re-characterization is not an option and you will need to correct by withdrawal.

If you are self-employed your contributions must be the lesser of the ceiling or your net income. Correct calculation of your net income and self-employment tax is essential.


If your excess contribution to a traditional IRA is due to age (if you were 71 in 2016, for example), you may be able to re-characterize to a Roth where there are no age limits.


If you contributed to a Roth and traditional IRA in the same tax year and your total contribution went over the allowable IRA amount, you would successfully correct only if you knew to remove the excess from the Roth IRA first.


Bottom Line: Excess IRA contribution rules are complicated. The advice of a knowledgeable tax and financial advisor will save your time and money.



Excess 529 Withdrawals & Education Credits: A Tricky Coordination

Non-qualified 529 withdrawals are subject to a 10% penalty.

529 withdrawals are only tax-free if used to pay for IRS-defined qualified educational expenses (QEE). The earnings portion of all non-qualified withdrawals will be subject to income tax plus a 10 percent penalty.  

The American Opportunity Tax Credit (AOTC) reduces your federal tax bill dollar-for-dollar by up to $2,500 per year for each eligible college student for qualified tuition expenses if you are within income limits,


Claiming both the AOTC and a qualified 529 withdrawal takes coordination. 

You cannnot claim any of the AOTC for expenses that were used to calculate the tax-free portion of a distribution from a 529 plan (or prepaid plan, or Coverdell) in that year.

For example, if you take $10,000 out of 529, your qualified educational expenses would have to be greater than $10,000 for you to claim any of the AOTC. Calculating how much to withdraw, when from a 529 plan to maximize the education tax benefits available requires advance planning.

Bottom Line: Maximizing education tax benefits requires coordination according to IRS provisions with stiff penalties for error. Having a financial and tax professional who understands education funding will save you time, money, and sleepless nights.


SNAP (fka SNAPCHAT) is going public tomorrow with a 1-Year “lock-up” on selling 


How to decide whether to buy Snap’s IPO

5 key factors:

  1. A one-year no sell restriction on 50 million of 200 million shares

  2. Shareholder Rights

  3. User Growth

  4. Monetization

  5. Competition 

Why is Snap prohibiting investors from selling 50 million shares for one year?

In Snap’s words:

"We expect approximately 50 million shares of our Class A common stock purchased by investors in this offering will be subject to a separate lock up agreement with us providing for a restricted period of one year following the date of this prospectus. These agreements will reduce the number of our shares available for sale in the public market during their term. We may, in our sole discretion, waive any of these lock up agreements before the restricted period expires."

Bottom Line

Investors who purchase these 50 million shares may not sell for 1 year, unless…

Snap management decides (if the stock does not tank) to waive the restriction.

Why is Snap doing this ?

A limited number of shares helps support the price of a stock. By limiting the number of shares available for sale in the public market, Snap is seeking to reduce the risk of the sharp decline that has plagued high profile technology IPOs.

Why would investors agree?  

These shares are generally for big investors, like mutual funds and corporates, who agree not to sell for one year in exchange for a guaranteed block of shares. 

So, the initial public offering is not exactly 100% to the “public” but an offering first to select large investors, and then to the public.

Is the Snap Lock-up Unusual?

Yes, it is unusual.  It is usual for there to be a 30 to 90-day lock-up period for insiders – who own stock prior to the IPO.  The Snap lock-up, in comparison, is for new investors, and is unusually long at one-year.

Is the Snap Lockup Positive or Negative for Individual Investors?

Both arguments are being made:

“A year-long lock-up period is atypically long, potentially signifying strong demand for the IPO.”

“Lock-up periods can buoy companies at risk of a stock selloff in the months following their IPO. This risk is particularly strong for companies in the technology sector.”

​Bottom Line: It may be either or both 

Positive: Big investors will agree to a lock-up when they anticipate paying a higher than IPO price if they do not receive the guaranteed block. In this case, the long lock-up signals the expectation of strong demand.

Negative: Snap must lock-up investors to prevent the sell-off that has plagued high-profile technology IPO. Here, the long lock-up signals the possibility and need to prevent a significant price drop.

The strong risk of a stock selloff in the months following a technology sector IPO in discussed in our earlier piece, here.


To summarize:


Of the last five technology IPOs in the U.S. (Groupon, Zynga, Facebook, Twitter, and Fitbit) only Facebook has since recovered from its first-year nosedive. Nine of the 15 to raise at least $1 billion had declines from 9 percent to more than 80 percent. Google (Alphabet Inc) is the exception.  It soared nearly 180 percent in its first year – but not in one day. So, investors had the opportunity to participate in a slightly less than 180 percent climb after the IPO date.


Those shying away from Snap’s IPO argue Snapchat's financial losses are growing and its user growth slowing amid renewed competition from services like Facebook's Instagram.  Others are concerned Snap’s two cofounders will hold voting control for the publicly traded company, meaning the founders will control all stockholder decisions. This is particularly problematic for those who maintain, founder, Evan Spiegel, the CEO, has a questionable personal history

“Deleting should be the default,” Spiegel has been quoted as saying, after the public release in 2014 of his undergraduate e-mails detailing  “illegal drug use, underage drinking, misogynistic behavior, including urinating on a woman after she passed out following sex, and harassing women he regarded as being overweight.”

4 key considerations for prospective Snap IPO investors

  1. Shareholder Rights:

    • Snap is structured in such a way that new shareholders won’t have voting rights and the input on matters usually associated with such rights, including board composition and executive pay. 

  2. Slowing user growth:

    • In the Q4 of 2016, Snap posted the slowest growth rate in of the 12 preceding quarters.

    • Snap maintains the slow growth was partly due to problems with Android, which have been addressed

  3. Monetization:  

    • Snap had negative cash-flow of $678 million in 2016, up from $326 million the year before. Snap has no profits, and is not expected to be profitable until 2020.

    • Snap has only just started focusing on making money from its users through advertising. Snap’s core bet is that advertising migrates to the mobile Web, since people Snap on smartphones.

  4. Competition: 

    • Facebook — and Instagram, which Facebook owns — is competition with $390 billion deep pockets & a huge user base.

    • Snap has a reputation for innovation.




  1. When: March 2, 2017

  2. Where: NYSE

  3. Price per share: $15-$18 (TBD the evening of 3/1/2017)

  4. Valuation: $19.5 billion - $22.3 billion

  5. Key considerations:

    • Shareholder Rights

    • User Growth

    • Monetization

    • Competition 

    • One-year “No Selling” period for 50 million shares


If you are considering investing, you should familiarize yourself with Snap’s business plan, growth expectation and financials. You may access Snap’s Prospectus here, and watch a roadshow video here.

Only you and your advisor can decide if for you, it is better to buy on the IPO date or wait and see if there is a decline or a rise in price which presents an opportunity more appropriate for your risk tolerance and reward objectives.


Since 2010, nearly 200 tech companies have held IPOs.


Of those which have survived, more than one-half are trading below their IPO price. Meaning that for every eventual IPO winner like FB (triple its 2012 IPO price) or ServiceNow (4x IPO), there is a loser like GoPro (1/2 IPO price) and Twitter (43% below IPO).

Given the price volatility of IPOs and even of “winners” like FB buying on the IPO date may not be the right strategy for an investor looking to fund financial goals. 


If you believe in the growth potential and profitability of a company filing for an IPO, or just want to own the stock because you like the product, before jumping in ask yourself and your advisor the following:

When should I buy?

At what price is my Stop Loss, Take Profit and Re-entry? 

How much can I afford to lose without putting my financial future at risk? 


How to give your Spouse a Gift that

Grows for Retirement 


Women to Watch


Investing like a Woman Pays Off

Especially during Market Roller-Coasters 

A gift wrapped in Tiffany blue may be hard to resist, but a gift that contributes to retirement dreams is even better.


A Spousal IRA is a perfect gift to show appreciation for a stay-at-home partner and increase retirement savings.


“You just stay at home?”  People often fail to recognize the critical value of the partner who steps out of a career to care for children or support the other’s business launch or climb up the career ladder.


Spouses, however, can recognize each other and add to their retirement savings by setting up a Spousal IRA (The Kay Bailey Hutchison Spousal IRA).


A spousal IRA gives a stay-at-home spouse equal footing to invest for retirement. A spousal IRA is a separate IRA set up in the spouse's name and social security number, belonging exclusively to that spouse. It is an exception to the IRS rule requiring earned income to contribute to an IRA.*


Put simply, if your spouse did not work outside the home, you may be able to set up a separate IRA (not name as a beneficiary of your IRA) based on your taxable compensation. The contribution may even be deductible.

To qualify, you must be legally married and filing a joint tax return.


While the maximum annual contribution of $5,500 ($6,500 for investors age 50 or older) may not seem like much, it is a lot fewer calories than chocolate and can make a real difference in your joint retirement savings over time.  


Spousal IRAs are a valuable retirement savings tool. They are simple to establish, and simple to fund. There is no special reporting to the IRS, and if you make a spousal contribution into a plan one year and your spouse returns to work the next year a regular contribution can be made into the same plan.  A Spousal IRA may be either a traditional or Roth IRA, and there is no requirement for spouses to contribute to the same type of IRA.


Other IRS IRA rules apply, including contribution thresholds ($5,500 each for 2015), income thresholds to fully fund a Roth (MAGI below $183K), and age restrictions for traditional IRA contributions (you must not be 70 ½ or older).


Talk to your wealth advisor about using a Spousal IRA to show your appreciation to a stay-at-home partner and increase your savings for retirement.



*Spousal IRAs

If you file a joint return, you may be able to contribute to an IRA even if you did not have taxable compensation as long as your spouse did. The amount of your combined contributions can’t be more than the taxable compensation reported on your joint return. See the formula in IRS Publication 590-A.  If neither spouse participated in a retirement plan at work, all of your contributions will be deductible.

How to Choose a College Savings Account 


An 'Education IRA' is now referred to as the Coverdell ESA.


Like a 529 college savings account, a Coverdell is a savings account with special tax status to encourage and reward saving for qualified education expenses.   


Deposits to both a Coverdell and a 529 account grow tax free until distributed and withdrawals are tax-free when used for qualified educational expenses.   


Very different are the requirements for contributing to and withdrawing funds:




- K-12 and college qualified expenses  

- $2,000 limit on total annual contributions

- Beneficiary must be younger than 18 

- Contributions are not tax deductible.

- Beneficiary must be under 18

- Funds must be withdraw by age 30

- Modified adjusted gross income must be less than      $110,000 ($220,000 joint)



- College qualified expenses only

- No annual contribution limit

- No age restriction on beneficiary

- Contributions may be state-tax deductible

- No age limit on beneficiary

No time or age limit on withdrawals

No income limit to establish account


If you qualify you may set up both a Coverdell and a 529 for each student beneficiary. 


Alert: Withdrawals are only tax-free if used to pay qualified education expenses. The earnings portion of all non-qualified withdrawals will be subject to income tax plus a 10 percent penalty tax. 


Coming soon in this series: 1. How to manage college savings plans for financial aid eligibility; 2. Leveraging 529 accounts a gift and estate tool; 3. Weighing a state tax deduction against 529 plan performance, 4. How to determine if you are eligible for education tax credits. 


As Twitter exploded with rants of succession and actor-politician stand-offs, women with the power to impact people’s lives made it clear they would hold their ground and stand by their principles in working with the president-elect.

Janet Yellen, Chair of the Federal Reserve Bank, quietly told the world while testifying before Congress that there would be apolitical policy-making under her leadership and there were no circumstances under which she would 'pick up her marbles & go home.'

"I was confirmed by the Senate to a four-year term, which ends at the end of January of 2018, and it is fully my intention to serve out that term."


In short, U.S. and world markets can count on stability in leadership at the Fed until February 2018, and on Yellen as a member of the Board until 2024.

The markets can also depend on Ms. Yellen to fight for the political independence of Central Bank policy.   

Testifying before Congress, Ms. Yellen stressed the need for central bank independence, and made clear her intention to ensure it under her leadership:


"Markets come to expect low and stable inflation from a central bank that has political independence and good economic performance…”

Janet Yellen is the first woman to hold the position, Chair of the Board of Governors of the Federal Reserve System.  She also serves as Chair of the Federal Open Market Committee (FOMC), the System’s principal monetary policy-making body.  

As leader of America’s central bank, Janet Yellen is arguably the most power woman in the world. She has immense influence over not only the U.S. economy but global financial markets. Trillions of dollars can be lost or gained based on how financial markets interpret her words.


World markets should respond favorably to the stability of her tenure and her commitment to an independent Central Bank.


Senator Dianne Feinstein (D-Calif.). Senator Feinstein, the first women to serve on the Senate Judiciary Committee, was named the first women ranking member (leader of the minority party) on Wednesday.


She immediately made her position know:

 “When President-elect Trump is willing to support responsible policies and nominees, I’ll hear him out, but this committee has a vital role to protect the Constitution and scrutinize policies, senior officials and judges very carefully, and that’s what we intend to do.”

“We simply won’t stand aside and watch the tremendous successes achieved over the past eight years be swept away or allow our nation’s most vulnerable populations to be targeted.”


As to Supreme Court appointments, Feinstein stressed:


"the committee will pay very close attention to proposed nominees to ensure the fundamental constitutional rights of Americans are protected.”


Senator Feinstein will also lead the committee’s review of president-elect Trump’s nomination of Jeff Sessions for Attorney General, stating:

"Senator Sessions has served on the Senate Judiciary Committee for many years so he's well aware of the thorough vetting he's about to receive. And while many of us have worked with Senator Sessions closely and know him to be a staunch advocate for his beliefs, the process will remain the same: a fair and complete review of the nominee. While Senator Sessions and I differ on a great many issues, I am committed to a full and fair process."

In the vernacular of President-elect Trump, it appears the women in D.C. have the "balls" to stand firm on their principles in the face of political pressure.  

Chair of the Federal Reserve, Janet Yellen  tells Congress she will not vacate her post under any circumstances (aka political pressure from Trump)

No matter how hard you may try to avoid it, the Trump presidency is likely to come up in conversation over the Thanksgiving holiday. Even if you intend to keep your personal opinions to yourself it is important to know the players. Below you will find a snapshot of key cabinet positions (bios may be accessed by clicking on a name), and a technology story to use as a distraction. Good Luck & Happy Thanksgiving.

Presidential Nominee Playbook aka  

Trump's "Mike" Trio

Mike Flynn (NSA) & Mike Pompeo (CIA) join Mike Pence (VP)


Mike PenceVice President-elect, former U.S. Congressman and current Governor of Indiana

Mike FlynnNational Security Advisor, Lt. General, retired (Senate confirmation required)

Mike PompeoCIA Director, Representative, Kansas

Jeff Sessions Attorney General, Senator, Alabama (R) (Senate confirmation required)

Reince Priebus - Chief of Staff, Republican National Committee Chairman  

“Under active consideration” for Secretary of State:

Mitt Romney - former Governor of Massachusetts who ran for president in 2008 and 2012. A longtime Trump critic, the appointment of Mitt Romney is likely to be viewed favorably by Democrats and U.S. allies concerned with alternative such as Rudy Giuliani and John Bolton.

Still to be announced:

Treasury Secretary  

This selection is likely to have the greatest immediate impact on financial markets. The Treasury Secretary is charged with ensuring the orderly operation of the U.S. Treasury market, perhaps the most important in the world. The perception of world markets of the ability of the Secretary to ensure its orderly operation can have “significant direct costs or savings to taxpayers, and changes in Treasury yields can also influence rates on other financial instruments and consumers around the world.” Read more.

Candidates include: Steven Mnuchin, former Goldman Sachs banker who served as Trump’s campaign finance chairman;  Jamie Dimon, current CEO, JPMorgan Chase; Jeb Hensarling, House Financial Services Chairman; Jonathan Gray, Blackstone Group (Dem)

World markets are closely following the selection process as president-elect Trump’s promise of infrastructure spending of ‘as much as half a trillion dollars on infrastructure’ while cutting taxes could balloon the budget deficit. Consequently, the next Treasury chief is viewed as a key player in articulating and executing economic policies.  U.S. debt doubled to $19.6 trillion from $10.7 trillion, while the federal budget deficit reduced by about two-thirds.

Expect wide and rapid fluctuations in the stock and bond markets as the selection process progresses.

For a full list of cabinet positions see:

NBC’s short video on the NSA, CIA and AG nominees may be viewed at:

   $25 Billion for

Disappearing Messages   


Have you always wanted to stun your tech-obsessed siblings or children with your knowledge? Well here’s your chance.

Ask how much they think the company behind Snapchat is worth, how much they would pay for a share*, and whether they own “Spectacles.” 

Snap Inc., the company behind the Snapchat qpp has filed for Initial Public Offering (IPO) valued at ~ $24 Billion (with a B) dollars.  *Hint: leaked information from a private funding round in May puts the share price at ~ $31. Read More

Snapchat is known for its app which lets users send disappearing messages from a smartphone. The company's strategy is to expand beyond the app, and in line with that strategy recently changed its name to Snap Inc. In May, Snap introduced “Spectacles” – sunglasses that record and upload 10-second clips video clips to SnapChat Memories via wifi. The glass have only been available by accessing a vending machine secretly placed in remote location untill a few hours ago when Snap opened its first storefront in New York. Visit the store here:

Valued at $20-25 billion the IPO would be the largest IPO since Chinese e-commerce giant Alibaba went public in 2014 ($170.9billion) and the largest technology IPO since Facebook went public in 2012 ($81.2 billion).  The four-year-old Snap filed a “Confidential IPO”. This means only the regulators see the initial draft of the IPO prospectus. The company is permitted to make changes before the prospectus is made available to the public. Snap was eligible for a “Confidential IPO” under the 2012 Jumpstart Our Business Startups Act because it expects to have less than $1 billion in revenue this year.
Why a confidential IPO? 1-The financial reporting requirement is two years of audited and 2 years of unaudited financial statements versus 2 years and 3 years for a regular IPO. 2-Confidential IPOs protect startups from public and media scrutiny during the process. IPOs are difficult, and a startup may choose not to proceed after initial filings due to market or business conditions.  A regular IPO filing could result in public disclosure of private information and damage to the company’s reputation should it decide not to proceed.
Read more at:
If you are considering participating in an IPO please read "Don't let FOMO threaten your financial goals" and speak with your advisor before making a final decision, particularly about timing your purchase.   

Talking Turkey Cheat Sheet

Thanksgiving Table Talk Cheat Sheet

Credit: STEVE DEMPSEY | Bay Area News Group     View full cartoon slide show here 

Don't be Bullied by Reports of Stock Market "Plunges" and "Soars"

August 19, 2016

Don’t be bullied by stock market reporting action words like "plunged" and "soared" when making investment and trading decisions. After all the noise, equities edged only slightly lower this week – DJIA Monday open: 18,588, Friday close 18,533.


Week in Review:

The DJIA closed slightly below (18,533) its Monday open of 18,588. The Federal Reserve remains split on the need for and timing (Sept v. Dec) of a rate increase. The yield on the 10-year Treasury Note rose to 1.58% from 1.49%. Oil, measured by West Texas Intermediate Crude rallied to $48.00 from $43.83.

And You:

Stay focused on your long-term plan and don’t be bullied to buy or sell based on sensational reporting.  Work closely with your financial advisor to ensure your investment plan is design to achieve your long-term financial goals and accurately reflects your time horizon and risk tolerance.  If you want to participate in short- and intermediate- market moves or have identified a stock or sector of interest speak to your advisor about setting aside an appropriate amount of funds for this purpose.  Be prudent and careful to ensure your active engagement in the market - if not profitable, cannot materially (negatively) impact your long-term financial stability. Remember, trading has the potential to negatively or postively impact portfolio returns.

One way to be actively engaged in the markets is to review your portfolio holdings with your investment advisor and identify opportunities for reallocation or investment of cash.  Questions to Ask:  Is this a good time to reallocate?  or to rebalance? Should I take profits and reinvest n another sector or asset class.  If you have been holding cash or looking to take a position in a stock or market, is now a good time to do so? 

Most importantly, remember that not even the greatest traders are right all of the time.  Trade wtih discipline.  Before you put on a position identify: 1. At what price you believe it is not a good trade and therefore will sell (to stop your loss) and 2. at what price you expect to take profit.  This analysis will help you trade with discipline and can serve to limit losses to tolerable levels and ensure the taking of profits. 

The ability of women to stay the course and not react to or try to beat markets is one of the reasons the portfolios of women generate higher returns than those of men. The recovery of the stock market to pre-Brexit levels within days of the 900-point sell-off illustrates why investing like a woman pays off. Investors that sold in response to the sell-off and then re-established positions likely did so at a higher price than where they sold, and incurred unnecessary sell and buy fees. 

Recent studies continue to support the seminal study, Boys will be boys: gender, overconfidence, and common stock investment, from the University of California, Davis, showing that women investors beat their male counterparts by around 1 percentage point a year.

With long-term returns from the stock market averaging 5 percent a year, 1 percentage point is a significant part of overall return. Resisting the urge to trade in-and-out of positions to try for market tops and bottoms, women incur less fees increasing their overall return. Women also do more research, and subscribe to a buy-and-hold investing philosophy that weathers market cycles.  

The market goes up, and the market goes down. Historically, which is not a predictor of future performance, over the long term the market has gone up. Currently, there are as many experts calling for another sell-off as there are calling Brexit a “buying opportunity.” Regardless of direction, I agree with KKR’s head of global macro and asset allocation, Henry McVey, that this is an "Adult Swim Only" market in which investors need to tread cautiously.



These two charts show the DJIA over the last one month and the last five days. The time period observed creates a very different impression of the market. The charts illustrate the market has recovered much of the initial loss it suffered after the Brexit vote, supporting the initial strategy of hold versus sell.   


The market's recovery does not predict the future, or indicate the market and individual stock will go higher. When the market reopens on July 5th, it is as likely to go lower as higher, or to tread pending new data or action by governments, central banks, corporates and financial institutions. The fact of Brexit has not changed.  The only change has been replcacing the uncertainty of the referendum with the uncertainty of the two-year process of Britain's exit.  The extreme market reaction simply illustrates why investment decisons should not be dictated by market moves, but by careful analysis of all relevant market and individual factors.


If you are investing or considering selling or buying securities speak with your financial advisor and create a plan that takes into consideration all relevant variables, both market and those unique to you, including risk tolerance, income, expenses, debt, savings, liquidity needs, portfolio holdings, other assets, time horizon and investment goals.

Student Loan Borrowers may be eligible for Refund of Late Fees & a Credit Upgrade 

Do you have a Wells Fargo student loan?  Borrowers are eligible for a refund of illegally charged late fees.  


The $3.6 million penalty Wells Fargo will pay to settle charges of illegal student loan practices is not going to help you or your clients, but the $410,000 Borrower Fund required under Consumer Finance Protection Bureau (CFPB) may.  

BottomLine: Wells Fargo illegally charged late fees to consumers who made payments on the last day of their grace periods, as well as those who elected to pay through partial payments.

Wells Fargo must submit a plan to identify and refund consumers within 90 days.


Ensure you / your clients gather payment and loan documents to ensure receipt of any eligible refund.

Wells Fargo also failed to update and correct inaccurate, negative information provided to credit-reporting companies about borrowers who made partial or extra payments. 

Ensure you / your clients secure a copy of a current credit report and submit the necessary information to update and correct inaccurate/negative information. 


You may read the Consent Order here or news articles on the Order here.

Women to Watch: Janet Yellen

Why the focus on Jackson Hole  

Caricature | by DonkeyHotey

The market's focus this week is on the speech Janet Yellen is expected to make at Jackson Hole on Friday.  

- Janet Yellen is the Chair of the U.S. Federal Reservce 

- Jackson Hole is where global Central Bankers will meet to discuss world monetary policy.

- Monetary policy is the control of the supply of money which impacts inflation and interest rates. 

Chairwoman Yellen will speak at the symposium Friday morning.  Her speech entitled "The Federal Reserve's Monetary Policy Toolkit" has the potential to significantly move the market if it gives a clear signal on the timing of an interest rate increase.  The Federal Reserve and analysts are divided on whether a rate increase will take place in September or December 2016.  Several strategists have pointed to the limitations of monetary policy and suggest the speech will focus on the need for other actions to achieve the dual goals of full employment and stable inflation.  

Major Wall Street firms speculating on the content of Ms. Yellen's speech have updated their forecasts for interest rates and the markets.  Read here.  


BottomLine: Any Federal Reserve increase is likely to be passed along to you in a chain reaction.   The Federal Reserve does not increase the interest rates you pay directly.  The Fed increases the rates banks pay to borrow funds, banks then raise their prime rate, which in turn affects mortgage rates,car loans, and other consumer loans. While banks can raise their prime rate even if the Federal Reserve does not act, they generally align with Federal Reserve policy.  BottomLine, a Fed interest rate hike will likely impact everyone - negatively and positively who has a home mortgage, car loan, savings account or money in the stock market.

If you are interested in learning more about investing and taking control of your financial future, Request your complimentary consultation. 



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