Capital Advisory Group - September 2020

Capital Advisory Group - September 2020

THE WEALTH ZONE

SEPT 2020

119 Old State Rd., Ellisville, MO 63021

CapitalAdvisoryGrp.com

Building a Better Future for Today’s College Kids ONE WAY TO HELP STUDENTS MITIGATE OR AVOID DEBT

A good breakfast is a lot like a good education. Just as a healthy breakfast can build the foundation for a productive day, a good education gives students a solid foundation for their futures. This month is Better Breakfast Month — the same month many students are preparing to go back to school. For students heading off to college, one big topic on their minds may be debt. Tuition rates have far outpaced inflation, and many graduates have been left with debt that takes years, if not decades, to pay off. Young people are wondering how they can build a foundation for their future if part of that future includes student loan debt. According to U.S. News &World Report, between 1999 and 2019, an average out- of-state tuition cost (at public universities) increased by 181%. The average cost of attending a private university increased by 154%, but those numbers don’t compare to the cost of getting a four-year degree on in- state tuition — that increased by 221%. If you knew your breakfast would leave you with a stomach ache or a feeling of malaise, would you want to eat that breakfast? Probably not. Chances are, you would find something else — something better. But what options do students, and their parents and grandparents, have?

Should they accept debt as a normal part of going to school? Should students have to work two or more jobs? One option is the 529 plan. If you’ve been following this newsletter, you know we bring it up from time to time. The 529 plan is defined by the Securities and Exchange Commission as a “tax- advantaged savings plan designed to encourage saving for future college costs.” Additionally, the 529 plan can be broken into two primary categories: prepaid tuition plans and college savings plans. Prepaid plans allow the account holder to buy tuition credit at current tuition rates (think of it as locking in rates). A downside of the prepaid option is that it’s expressly for tuition and related fees. Equipment (such as laptops) and other amenities (including room and board) generally aren’t covered. This option is also subject to a limited enrollment period. College savings plans, on the other hand, are not subject to an enrollment period. Anyone, regardless of age, can open a savings plan with the purpose of saving for college. The account holder can make contributions as desired or set up an automatic deposit. That said, account holders are limited to how many contributions they can make to the account. Those limits vary state to state

and range roughly between $235,000 and $500,000.

When it comes to taxes, it’s important to note that 529 plans are not subject to federal or state tax as long as the beneficiary follows account guidelines. In other words, as long as the beneficiary uses the account to pay for “eligible college expenses” they will not be subject to income tax and a 10% federal tax penalty. To that end, it’s important to carefully review the terms of your specific plan. Another thing to consider: 529 plans are essentially investment portfolios. Growth of the college savings plan is dependent on market performance, as these plans are made up of stock mutual funds, bond mutual funds, and money market funds. The account holder can choose the investment options when the account is opened. Opening a 529 account for your child or grandchild can be one of the greatest gifts you give them. It takes away much of the financial burden that comes with pursuing higher education, giving them a better foundation for their future. Call it a better breakfast! If you need more information on a 529, give our office a call. We'll be happy to assist you. -Jeff and John Zufall

(636) 394-5524 1

Published by The Newsletter Pro • www.TheNewsletterPro.com

Looking for Your Next Home Project? THE HOTTEST QUARANTINE KITCHEN REMODELS

CHANGE CAN BE EASY

Pam Marmon’s Outline for Effective Post-Pandemic Transformation Pam Marmon understands what it means to adapt. After growing up in Bulgaria, Marmon had to modify her way of living when she emigrated to the U.S. Today, she’s a CEO, entrepreneur, wife, and mother who believes that change doesn’t have to be difficult. In fact,

she’s mastered it. Marmon has even established a company, Marmon Consulting, that helps other companies develop strategies for executing transformation. In Marmon’s book, “No One’s Listening and It’s Your Fault: Get Your Message Heard During Organizational Transformations,” she outlines her proven methods for effective communication in any company setting, from a major corporation to a family business. Released on March 24, 2020, Marmon’s advice is timely in a period when many business

Cooking in a beautiful, open kitchen is the dream of homeowners everywhere. Luckily, in 2020, many quarantined kitchen lovers have turned that dream into a reality. There have been a ton of kitchen projects trending on Twitter and Instagram, and if you want that natural and open aesthetic for yourself, try implementing the renovations below. A popular project has been to install more open shelving , and it’s not just because people want organizational space! By using open shelves instead of cabinets, you can make your kitchen feel larger while showing off those beautiful plates and cups! Whether you install a sleek slab of reclaimed wood or an industrial wood and pipe shelf, there are a lot of natural pieces you can use to make your kitchen look like it stepped out of a modernized village home. Pantry remodeling is another popular trend that’s improving the kitchen and adding space. Why does the door to the pantry have to be solid wood? If you want something more lightweight, try using a porch door. The see-through features can make the space more inviting, especially when painted a beautiful, bright color like emerald green or baby blue. Then, upgrade your pantry’s organization with wooden boxes, tall glass jars, and natural-colored containers. Thinking of a bigger project? We’ve got your back. One way to make the soft light in your kitchen stand out is to install dark flooring . Not only can it contrast lighter furnishings and cabinets, but it’ll also flatter your lighting even more! To keep up with the bright, easy-going appearances, try using light reclaimed wood for cabinets. It’s visually textured and healthy for the environment! Furthermore, Carrara marble countertops can add sleekness to your kitchen without drawing attention away from the other beautiful accent pieces in your kitchen. Still looking for more inspiration? Check out the #interiordesign hashtag on your favorite social media site and find your dreamy, movie-perfect kitchen.

owners are searching for proactive solutions and the next step in finding post-pandemic success. Marmon’s book is the perfect guide for business leaders who recognize the need for tangible change and want to execute it as effectively as possible. The key, Marmon explains, is to identify your company’s culture and cater your plan’s language to suit what will resonate with your employees the most. This will establish a sense of alignment with your business’s vision and direction, which can be one of the biggest hurdles to overcome. You cannot achieve success in a period of change if your team is doubtful and unwilling. With your company united toward your vision, you can begin to enact real change. However, this is only the beginning. Marmon’s book also outlines how to connect with fellow leaders in your company to develop a framework for growth. By creating a stable foundation and inspiring change, you’ll find this time of major transition to be much smoother than you may have anticipated. As a result, your company will come out on top at the end of the COVID-19 era. Marmon’s mantra is inspiring: “With the proper process, change is not hard.” And with her book, “No One’s Listening and It’s Your Fault,” business leaders can see just how simple change can be.

2

CapitalAdvisoryGrp.com

Money Myths: What’s True and What Isn’t?

There are many “money myths” out there — myths or beliefs that suggest you should do this or that with your money — or approach taxes a certain way. However, many of these myths are centered around poorly thought-out advice. Here are two common examples: 1. It makes sense for only one member of the household to manage the finances. It’s not uncommon for one person in a household to be in charge of the bills, banking, and other accounts. Many people don’t necessarily enjoy being involved in finances, so by default, one person takes the reins. While this arrangement may work for a while, it can also be a source of long-term problems. Should the person in charge of the finances become ill, incapacitated, or die, this could leave the other partner (and potentially other family members) in a challenging position. They must figure out the financial puzzle piece by piece, and there is no guarantee that puzzle will ever be completed. This is why communication about finances between spouses and family members is so important. Even if one person handles the finances, there should be discussions about those finances. Both

spouses should be fully aware of the bills that come into the household and all the accounts they have open in their names (from checking accounts to retirement accounts). 2. You should be concerned about estate taxes. The media often portrays estate taxes as something we all need to worry about and that we should set up a trust to better manage these particular taxes. For some families, estate taxes are something they need to worry about — but for most Americans, this isn’t the case. In 2020, there is an exclusion limit of $11.58 million. For an estate that exceeds that limit, federal estate tax would only be owed on anything beyond the $11.58 million. However, if the estate is valued at less than $11.58 million, heirs would not have to worry about the federal estate tax. Many states have estate or inheritance tax — Missouri has neither, while Illinois, for example, has a 16% estate tax. Regardless of the value of your estate, it pays to have an estate plan in place, including a living will and designation of power of attorney. Spell out your health care wishes and make sure all of your estate documents are organized and up to date.

TAKE A BREAK

BACON AND EGG BREAKFAST PIZZA

This twist on a pair of classic breakfast foods is the perfect back-to-school fuel for your kids. Whip it up at breakfast or any time of day, really — it’s never too early or too late for pizza.

Ingredients

Directions

• 1 package premade pizza dough • 2 tbsp olive oil, divided • 6 eggs • 2 tbsp water • 4 slices bacon, cooked and crumbled • 2 cups cheese of your choice, shredded

1. Preheat oven to 400 F. Grease a 15x10x1-inch pan. Spread the dough evenly over the bottom of the pan and 1/2 inch up the sides. Prick it with a fork and brush with 1 tbsp oil. Bake until lightly browned, about 7–8 minutes. 2. In a nonstick skillet, heat the remaining oil on medium. In a bowl, whisk the eggs and water together. Add the mixture to the skillet and stir until thickened and no liquid egg remains. 3. Add the egg to the baked crust in an even layer. Sprinkle on the bacon and cheese, then bake 5–7 more minutes before serving.

Inspired by TasteOfHome.com

3

(636) 394-5524

119 Old State Rd. Ellisville, MO 63021 CapitalAdvisoryGrp.com

PRST STD US POSTAGE PAID BOISE, ID PERMIT 411

Helping Students Build a Better Future

page 1

How to Enact Effective Change

page 2

The Hottest Kitchen Remodeling Trends During Quarantine

page 2

Two Money Myths Busted

page 3

Bacon and Egg Breakfast Pizza

page 3

Who Knew There Was a Fortune Cookie Day?

page 4

ONE FORTUNATE COOKIE Put a Little Crunch in Fortune Cookie Day

Would you trust your future to a fortune cookie? Your finances? Hopefully, the answer is no! For a long time, fortune cookies have been a Chinese takeout staple. We associate them with Chinese restaurants, and they make for an amusing way to end a meal. We crack open the cookie and read our personalized prophecy or anecdote about the future. Then, we promptly forget about it and go about our day. Sept. 13 is Fortune Cookie Day — a day dedicated to the small crimped cookie that’s stuffed with a paper fortune. How do you celebrate this day? It’s up to you. Order takeout and enjoy your fortune or just buy the cookies themselves for a simple treat. Interestingly enough, there is confusion as to the origin of the fortune cookie, but all historians agree on one point: It didn’t

come from China. Instead, its origins are Japanese. In the 1800s, a cookie that looked remarkably similar to the modern fortune cookie was developed in Kyoto, Japan. The big difference between the 19th century version and today’s version is the flavor. Back in the day, it was a savory cookie, made with ingredients like sesame and miso, and the fortune-stuffed cookies were physically larger. In the early 20th century, the fortune cookie appeared in the United States. These cookies were served at the Japanese Tea Garden at Golden Gate Park in San Francisco. The invention of the modern fortune cookie isn’t without a little drama. In 1918, the founder of the Hong Kong Noodle Company, based in Los Angeles, told the

world he was the inventor of the cookie. Several decades later, in 1983, a federal judge took a look at the case. After reviewing San Francisco’s Court of Historical Review, the judge ruled that the cookie was invented in San Francisco. The tea shop owner got all of the credit. But why are they served by Chinese restaurants today? It’s a simple way to offer thanks to restaurant patrons.

4 CapitalAdvisoryGrp.com

Published by The Newsletter Pro • www.NewsletterPro.com