Business Owner Requirement
If you are the owner of an LLC or corporation, the Financial Crimes Enforcement Network of the United States is requiring you to file a report. The deadline is 12/31/2024 and the fine is $500 per day if you do not file a report. If your tax team has not discussed this with you yet, you could work with our team members at Summit Tax Services (Heemer Klein and Co.) to complete it. To file on your own, go to: https://boiefiling.fincen.gov/fileboir
President Biden’s Announcement
On July 21st, President Biden announced that he would not be running for re-election and endorsed Vice President Kamala Harris to be the Democratic nominee for President. At this time, the polling numbers are similar moving from President Biden to Vice President Harris, so it has not moved the stock market much. We will continue to monitor the situation, including polls, stock market movements, and likely policy changes after the election.
Inflation Concerns
We speak with clients all the time about how challenging the past few years have been when it comes to inflation, and how certain expenses, especially grocery store trips, seem to be worse than what they see on the news or within government reports.
Understanding CPI Adjustments
The government wants to keep official inflation numbers, better known as CPI, as low as possible because there are over 70 million Americans on Social Security and 5 Million Americans working for the US Government/Military.Thus, roughly 23% of the country gets a raise every time CPI is reported higher.
Historical Changes in CPI Calculation
The government has adjusted the formula which has reduced the official numbers over the years. Most notably, they removed interest expense in the early 80’s.
If we were calculating CPI today the way we calculated it back in the early 1980’s, it would have increased by nearly 30% in the past few years. In 2023 alone, inflation would have been over 17% using the old methodology. In summary, inflation feels worse than the official number in some cases, and that may be on purpose.
Financial Planning and Review Meeting
We’d love to have a review meeting with you to discuss investments, retirement income planning, college planning for kids or grandkids, tax preparation, health insurance, including Medicare supplemental and prescription drug plans, and a variety of other financial planning topics. Please contact our office at (586) 226-2100 to schedule a meeting!
If you’ve had any changes to your income, job status, marriage status, a new birth in the family, 401K options, address, risk tolerance, or any other financial changes, please contact us right away.
Watch This Month’s Market Commentary on YouTube:
Sincerely,
with contributions from Robert Wink, James Wink, Zachary Bachner, James Baldwin, and Daniel Ladzinski
Sources:
- https://www.nbcnews.com/politics/2024-election/kamala-harris-trump-2024-polls-biden-rcna162934
- https://www.ssa.gov/policy/docs/chartbooks/fast_facts/2023/fast_facts23.html#:~:text=70.6%20million%20people%20received%20benefits,Social%20Security%20benefits%20in%202022
- https://www.statista.com/statistics/204535/number-of-governmental-employees-in-the-us/
- https://www.investopedia.com/articles/07/consumerpriceindex.asp
- https://www.shadowstats.com/alternate_data/inflation-charts
Notes & Disclaimer: Investment advisory services are offered through Summit Financial Consulting LLC, an SEC registered investment advisory firm. Registration does not imply a certain level of skill or training. Summit Financial Consulting Investment Advisory Firm Representatives do not render tax, legal, or accounting advice. Life/Annuity Insurance products and services offered by the individual insurance agent. Health insurance is offered through Summit Health Services, LLC and Property/Casualty (P&C) Insurance is offered through Summit Insurance Services, LLC and our local P&C agency partners. Please update Summit Financial Consulting LLC, if your investment objectives have changed or if the personal or financial information previously provided has changed. The investment advisory disclosure document that describes Summit Financial Consulting investment advisory services account is provided to you annually, but additional copies are available upon request. Investing involves risk, including the risk of a total loss. Stock market indices, like the S&P 500 Index, are unmanaged groups of securities considered to be representative of the stock market in general or subsets of the market, and their performance is not reflective of the performance of any specific investment. Investments cannot be made directly into an index. Historical returns data are calculated using data provided by sources deemed to be reliable, but no representation or warranty, expressed or implied, is made as to their accuracy, completeness or correctness. Dividends are not included in index returns. This information is provided “AS IS” without any warranty of any kind. Past performance is no guarantee of future results. This communication is only intended for recipients who reside in states where our agents are licensed to sell these products. All guarantees are subject to the claims paying ability of the issuing insurance company. Past performance cannot predict future performance. It is not possible to invest directly in an index. Representatives of Summit Financial Consulting LLC offer tax preparation services through Summit Tax Services. Summit Tax Services is a DBA of Heemer Klein & Company and they are owned and operated independently.