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Epic Insights

Getting Off On The Right Foot in 2012

January 9, 2012

A look at some financial changes & the opportunities they may present.

Every year brings some financial change, so here are some relevant changes relating to investment, tax and estate planning for 2012.

Retirement plans. 401(k), 403(b) and 457 plan annual contribution limits rise slightly to $17,000, and you can contribute an additional $5,500 to these accounts if you are 50 or older this year. IRA contribution levels are unchanged from 2011: the ceiling is $5,000, $6,000 if you will be 50 or older.¹

As you strive to contribute as much as you comfortably can to these accounts this year, you will probably notice some changes with the retirement plan at your workplace. In 2012, retirement plan sponsors (i.e., employers) will have to note all of the fees and expenses linked to the funds in the plan to plan participants. So if you have a 401(k) or 403(b), you may notice some differences in the disclosures on your statements and you will probably notice more information coming your way about fees. There is also a push in Washington, D.C. to have financial companies provide Read More »

Estate Plans’ Cloudy Times

December 7, 2011

This post is actually an article written by Epic Capital’s Managing Director, Edward Doughty, CFP® that was featured in the Charlotte Business Journal’s December 5th 2011 issue. Here is the article as it appeared, and in it’s entirety:

The Congressional Joint Select Committee on Deficit Reduction (the Super Committee) failed at its task of finding $1.2 trillion in debt savings over the next 10. Now, the process known as sequestration, which triggers automatic spending cuts, is slated to kick in January 1, 2013. The cuts must be split evenly between defense and other programs, and raising taxes is not imposed by the process. And with next year’s elections, the stage is set for more legislative inaction.

Regardless of the 2012 election results, if Congress fails to pass legislation and the Bush tax-cuts expire, taxes will increase across the board in 2013. So with just over one calendar year before the tax cuts are slated to expire, some observers believe this is one of the best environments for estate planning in a generation. Read More »

Year-end Tax Planning: 10 Things to Keep in Mind

November 23, 2011

The window of opportunity for many tax-saving moves closes on December 31. So set aside some time to evaluate your tax situation now, while there’s still time to affect your bottom line for the current tax year. With that in mind, here are 10 things to consider as the curtain closes on 2011.

1. Deferring income to 2012 means postponing taxes

Consider opportunities you might have to defer income to 2012. You might be able to delay a year-end bonus, for example. If you’re able to push what would have been 2011 income into 2012, you may be able to put off paying income tax on the deferred dollars until next year.

2. Paying deductible expenses sooner may help you in 2011

Does it make sense for you to accelerate deductions into 2011? If you itemize deductions, it might help your 2011 bottom line to pay deductible expenses like medical costs, qualifying interest, and state and local taxes before the end of the year, instead of waiting until 2012.

3. Income tax rates to remain the same in 2012

The same six federal income tax rates that apply in 2011 will apply in 2012. So, depending upon your income, you’ll fall into either the 10%, 15%, 25%, 28%, 33%, or 35% rate bracket. And, as in 2011, long-term capital gains and Read More »

European Rescue Package

October 28, 2011

Here is a great piece written by LPL Financial’s Chief Market Strategist, Jeffrey Kleintop. After seeing Jeffrey present back in early August in the midst of extraordinary market volatility, it became very obvious that he simply gets it. His observations are clear and concise, his forecasts very easily understood, and his knowledge level is second to none. Enjoy this lastest writing, we did:

The European summit on October 26, the fourteenth in 21 months, finally produced a deal in a late-night negotiating session. European leaders announced a deal that was close to what had been carefully leaked over the prior weeks of deliberations and had helped the S&P 500 Index to rally off of the lows of the year. From the closing low on October 3, the Index has climbed nearly 17% in just three and a half weeks and is on pace for the largest monthly gain since 1987.

Overall, the statement confirms the view that the risk of a 2008-like financial crisis erupting in Europe, which has been the focus of global markets in recent months, has been taken off the table. However, over the long term, concerns remain about the outlook for economic growth in Europe and the ability of some peripheral countries to meet budget targets. While the statement does not clarify all the details, it does lay out the three most important aspects of the rescue package:

Reducing Greece’s debt. The package cuts Greece’s debt burden with a 50% “haircut” on Greek bonds. Private investors, including banks, will swap their Greek bonds for those with half the face value, but higher quality given an Read More »

Why Europe Matters to Your Investment Portfolio

October 13, 2011

This is a great synopsis from our friends at Forefield, as to why the US financial markets seem to hang on every new piece of news out of Europe regarding their debt problems:

Ever since the possibility of default on Greek sovereign debt has become headline news, a lot of people have found themselves wondering, “How is it possible for the financial problems of a country so small and so far away to create such turmoil in the world’s markets?” What’s happening in Europe is probably affecting your portfolio right now, regardless of the quality of your holdings or how well diversified you are.

Just what is all the shouting about? It’s no secret that the so-called PIIGS nations (Portugal, Italy, Ireland, Greece, and Spain) are having difficulty coping with the debt that years of deficit spending have created. A robust global economy helped to mask the problem, but in recent years the burden of sovereign debt–bonds issued by sovereign governments–has become increasingly unsustainable. With debt at roughly 140% of its gross domestic product,* Greece is particularly troubled. Imposing austerity measures required by its European colleagues has added to the country’s recessionary woes. That in turn has made it even more difficult to achieve mandated deficit reduction targets in order to qualify for additional installments of financial aid from the European Financial Stability Facility (EFSF) set up last year by 17 eurozone countries.

Bank exposure

One of the chief concerns about the possibility of default on sovereign debt has to do with the financial stability of banks that hold it. Some of the largest French banks have already suffered downgrades of their credit ratings because of their extensive holdings of debt from troubled European countries, particularly Greece. If a Greek default made Read More »

A Financial Check-up from the Neck-up

September 8, 2011

We have all suffered through (and many are still suffering through) the second worst economic downturn in our country’s history. “I Was There” and no one is even handing out the proverbial free tee-shirt. But there have been signs of hope, as the stock market has rebounded well off its 2009 lows, corporations are in much better financial shape, investors have delevered, and many economic indicators are still moving in the right direction (albeit at a much slower pace than most would like to see). The most stubborn areas can still be seen today in the housing market and the elevated levels continuing in unemployment. Add to that the US debt debacle, as well as European debt woes, slowing growth in the emerging markets, an S&P US rating downgrade and the media is once again having a feeding frenzy.

We are once again starting to hear the rumblings of the most overused financial term in the last decade … the infamous “Double-Dip”. Yet for the longest time, one would only associate that phrase with a trip to Dairy Queen, Baskin Robins, or maybe even these days Ben & Jerry’s or some newly launched frozen yogurt chain.

What’s the chance of a “double dip” recession? Statistically very slim, as it has only happened two other times in the last one-hundred years (and in both cases the circumstances were very different). But don’t pop the cork yet. Read More »

Budget Cuts & The Debt Ceiling

July 19, 2011

If we slash trillions from the federal budget, what does that do to our GDP?

The summer of discontent stretches on. As July ebbs into August, we have no resolution on the federal debt limit issue. The possibility of default is still in play. Republican leaders want major cuts to entitlement programs as a condition of raising the debt ceiling; Democrats agree on the necessity of cuts but also want tax hikes for the wealthiest Americans to bring in added revenue.

A trillion-dollar divide. On July 14, CNBC.com reported that both parties had tentatively agreed on nearly $1.4 trillion worth of reductions to the federal budget. That’s not too surprising: $1.4 trillion is the projected size of the budget gap for the fiscal year ending in September. Republicans have called for $2.4 trillion in cuts.^1,2

This federal belt-tightening is going to lead politicians, economists and consumers into the second part of the debt cap Read More »

The D Word Haunts Wall Street

July 5, 2011

Is there a chance that America could actually default on its debt?

When will the debt ceiling issue be solved? The NFL, the NBA, the EU, Congress … wherever you look, it seems people would rather wrangle these days than resolve their differences. The U.S. Treasury has set a hard deadline of August 2 for Congress to settle its divide on the federal debt ceiling, and if partisan bickering interferes, the world economy could suffer a severe hit.

What would happen if we miss the deadline? According to federal budget analysts at the Bipartisan Policy Center, the Treasury would only be able to make a slight majority of its 80 million monthly payments in August. Treasury Secretary Timothy Geithner would likely be put in the same position as a struggling consumer low on cash and behind on his bills: he would have to selectively decide which debts to pay for the month and which to ignore.¹

Should August 2 come and go without a solution, Congress’s inaction (and Geithner’s subsequent decisions) would have dramatic global repercussions. Most likely, his big priority would be to pay off bond investors so that a formal Read More »

Greetings from Charlotte, North Carolina

June 8, 2011

Greetings from Charlotte, North Carolina, and Welcome to Epic Capital’s first ever “Epic Insights” blog post! We will keep this post short, as we are simply excited to take this blog site live, but please know that we will be adding much more content in the days, and weeks to come.

Ever since Epic Capital was started, it has been a goal of ours to break down the walls of conventionalism when working with a financial management firm. Most practices tend to isolate their clients and treat them merely as a customer rather than the purpose of their firm’s existence. In the conventional model, the advisor dictates the relationship. At Epic Capital, we look to put our clients at the center of our day and then we revolve around them. We look for our clients to be as involved or as uninvolved as they feel they’d like to be in our working relationship. If e-mail is their communication tool of choice, we oblige. If they prefer a 30-minute phone consultation once every month, we can accommodate. If they would like to do a financial plan review via a live web-feed or screen-share, we’ll do that too. They call the shots and we customize our interaction accordingly. Read More »

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