By Curtis Burkholder
Take a moment to pause and remember how you felt at the beginning of 2020. Did you have a sense of excitement and anticipation for the start of a new year and new decade? What did you hope to accomplish this year? What did you expect life to look like by the middle of 2020?
If you were like me, you started the year with excitement, anticipation, and goals you hoped to accomplish. However, that quickly changed as March arrived and coronavirus changed all our lives. With schools and businesses being closed and “stay at home” orders in place, life suddenly was drastically different. I think it’s safe to say that none of us anticipated this new “normal”: mask wearing in public, limits on business capacity, and phrases such as “social distancing” and “6 feet apart” being commonplace.
Despite how things turned out and amid the challenges we all faced (and continue to face), I would encourage you to pause and reflect on where you are in life right now. Were there things you were able to accomplish over the last several months with reduced scheduling commitments? Did you find some things impossible to do with businesses being shut down? Have you had new opportunities or insights due to being required to stay at home? No matter what life looks like for you right now, I encourage you to revisit your dreams and goals. While some may need to be adjusted, some may be even more relevant today than ever before!
Reevaluating goals can be applied not only to personal life but also to our financial lives. Perhaps you have experienced a loss of income or increased job uncertainty. Maybe you’re busier now than ever and have seen your earnings greatly increase. Wherever you find yourself financially, it is wise to evaluate if you are doing the best job with the finances that have been entrusted to you.
In times of uncertainty, having a plan can help to guide us through difficult times. For example, when we travel, there are unknowns that can arise such as detours and mechanical breakdowns. However, as you remain patient and focused, even following the detour, you will arrive at your original destination. The same is true of our financial lives. When we stay focused on our goals and values, as we come upon “detours” in life, we can adjust our actions accordingly. Intentionally remaining focused on and revisiting our goals as needed, while navigating detours, allows us to accomplish what we set out to accomplish.
In conclusion, as we find ourselves in unexpected circumstances, I would encourage you to reflect back on the goals you set for 2020 as well as what you have learned over the last 6 months. As you then turn and look to the future, consider what is most important to accomplish with the time remaining in 2020. I believe God has unexpected opportunities and possibilities in the days and months ahead for you and your family!
by Ron Bare
In February of this year, I spent a week in Florida with my family as well as with some of our team from the office. Visiting colleges with our daughter, going to Disney’s Animal Kingdom, enjoying the beach, and attending the annual “Kingdom Advisor Conference” all seem like a distant memory. It is hard to believe that this was only three months ago! While we had heard a few “rumblings” of a new virus during our travels, we saw no masks or any cause for concern, even when boarding our plane on February 23rd.
The equity markets at the time were reaching new highs. The US economy was very strong, with record low unemployment and solid GDP growth rates. Although some were saying markets were beginning to look overvalued, the bottom line was that companies were profitable and were predicting even greater profits throughout 2020.
Then Covid-19 arrived and with it, full-blown panic. The market dropped 34% in 33 days, a record decline. I discussed this in our video blog in late March (which you can find on our website.) Now, two months later, the dust has begun to settle and although the panic has subsided there is still uncertainty about where we go from here. The markets have since recovered much of their decline, however, a large amount of skepticism remains. With this in mind I thought it may be wise to pass on a few thoughts relating to investing success over time:
- When stock prices are going down, the enduring value of the underlying companies is going up. The lower prices go, the more value is to be had at those prices. You understand this in almost every other area of your economic life (we all love to purchase something on sale!) It is essential to apply this same principle to the stocks of American companies we invest in – or you may never become a successful investor.
- Staying fully invested during market declines is the only sure way to capture the entirety of the markets long term advance. It is not possible to consistently sell out of falling markets and buy back later at the “right” time. Most of the market driven news is geared toward market traders, NOT long-term goal and plan driven investors. To the latter, market fluctuations are just part of the process to be rewarded for the long term returns of some of the greatest companies of America and around the world.
- You should never try to make long-term investment strategies out of short to intermediate-term disruptions. We always advise to make investment decisions based on our values and financial plan, not short-term events or emotions. The past few months are a good example. Let’s assume you ignored the market downward collapse of 33 days in late February and March and woke up today, May 15th, and took a look at the markets. Yes, they are down 15-16% from earlier highs, but that is in the range of a typical market correction that happens about once every 12-18 months.
There is the ongoing chance that the markets will continue to drop back due to the uncertainty we still are facing with the Covid-19 virus and economic wake it will leave. If you adhere to the ideas presented above, then these fluctuations should not impact your long-term goal and plan driven investment strategy. Perhaps when we focus on the long term, we not only will make much better investment decisions in the short term, but we also will rest better as we wait for time to pass.
by Ron Bare
For many of us, both individually and as companies, the year 2020 was to be an exciting “Year of Vision!” As 2019 drew to a close we began thinking of developing tools and correspondence to help our team and clients pursue a greater vision – not only in the area of finances, but also in other areas that money can be used as a tool to enhance. Areas of life such as family relationships, health, friendships, spiritual enrichment and more can all be improved when we gain better vision in our desires for these areas.
Then, as you are very aware, Covid-19 arrived in our country and the urgent took priority over many other initiatives. “2020 Vision” suddenly took a backseat. Perhaps at first your response was, what is the point of planning or focusing on our future vision when we need to survive this health scare and the financial/job implications that may flow from it. That is how I felt as this unfolded these past few months. But now I have another thought – what if this “reset” or “pause of life” (which is unlike anything we have ever experienced) is a gift to actually help us get a better perspective for tomorrow? Would we have ever really stopped all the activities and busyness of our lives long enough to gain true “2020” vision for our future? I’m doubtful.
Have you heard the old saying “Eat Your Carrots – they give you good vision!” Well, as I child I loved carrots. I always chalked my love for carrots as the reason for my 20/20 eyesight. Even as many of my peers have started to lose their vision and need corrective eyewear to get back to 20/20, I proudly kept eating my carrots. But time is moving on and I find myself holding the paper and my phone a bit further away from my eyes as I read. I stubbornly have stayed away from the eye doctor but I must admit, to get back to “20/20” I may need more than carrots for my vision!
Perhaps this quarantine has been the “corrective eyewear” we needed to get back to 20/20 vision for our lives. Let us not waste the good that has come from this. What have we learned? What do we need to change when life gets back to “normal”? Do we really want to go back to the way things were? Like many of you I am ready to fully get back to work. I am ready to get outside and go out to eat, “sit down style!” I miss sporting events, both locally and professionally. I miss actually going to church each Sunday. But I am not ready to go back to the hustle of plans most evenings and weekends, running to school/sports events often, and catching a few brief conversations with my kids and wife in passing. I LOVE the family dinners, games after dinner, conversations in the kitchen, cooking meals together, actually finishing projects that have been on the list, working out each day with my son and knowing that the upcoming weekend has a good bit of margin for life and rest! I love having extra time to connect with many of our clients on the phone and not running from appointment to appointment feeling rushed in many conversations. I want to listen to them, hear how they really are doing, and pray and help anyone I have the opportunity to spend some time with.
What is my vision for 2020 and beyond? How about taking better care of the body that God has given me and making exercise part of my daily life – doing it with my family. Growing spiritually as I read the Bible and connect with God on a deeper level because I’m spending time with God and actually listening to what He is saying in His word rather than feeling rushed by the next daily agenda item. Connecting with family by being together and enjoying each other (most of the time, 😊) rather than just going to watch them participate in an activity. Really connecting with a few close friends and sharing life together. And working with additional margin so we can not only provide financial counsel but care and connect in deeper ways.
How about you? What is your vision for beyond the Covid-19 quarantine? What have you learned? What have you enjoyed and what do you need to DECIDE now so when life gets back to “normal” you do not, but rather you create a “new normal”. A normal with purpose, vision, margin, enjoyment and time to connect with God and people – the way God designed it.
by Ron Bare
As I sit down to write this, it is a sunny 70-degree day with a slight breeze, some would say near “perfect” conditions. It may be perfect weather but that’s not what I feel inside. I feel a burden – a burden but at the same time peace. Peace that goes beyond my understanding but a heaviness of the unknown. How many lives and families will be affected? What will the economic impact be and how will it ultimately affect us? All of the “experts” seem to have a different outlook on the health situation and the financial impact and timeframe. Could it be that no one really knows? Where should we go for the answers?
These past few days as I worked at my home office, I watched several signs of new life outside my window; a robin with bright colors, a finch perched just feet away, a bald eagle flew right over my house and I can almost watch the bushes and trees budding their leaves. These are all reminders that spring is here and new life is coming!
It is also the week of Easter. A story that redefined the meaning of life! Hope, Peace, Love, Joy can all be found in the Easter story regardless of the circumstances we find ourselves in. Jesus died on Good Friday and all seemed lost – even his 12 disciples thought it was over. They fled for their physical lives, were emotionally defeated and spiritually confused. BUT Easter morning came a few days later and everything changed! Over 500 witnesses saw Jesus after he rose on Easter and many wrote about it and sacrificed their lives because of their testimony. They had a new outlook – one that changed everything. Physically they had hope for life beyond what this world has to offer, emotionally they had joy and peace even when enduring suffering, and spiritually they had a rebirth knowing they had hope for eternity.
We can experience the same today in the uncertainty of our life circumstances. We may find ourselves wanting to control our circumstances or how our leaders are responding – but we will be better off working on self-control. We CAN control how we respond to events, but usually cannot control the events themselves. How can we have contentment, faith in the future, and peace? To be content it is necessary to not fear the future, to have peace we must look for truth and to have faith we must rely on what is trustworthy. Are these even possible? Yes! The Easter story makes all this possible. We have someone who gives us a bright future, who IS truth and who has proven trustworthy. This person is found in the center of the Easter story – Jesus. He is our Way, our Truth, and our Life!
We are praying for you and your family that you will experience His peace, joy and hope this Easter weekend. And for our country and world to have physical, emotional, and financial healing. I am also looking forward to a good ham and lots of chocolate!
The CARES Act is an acronym for Coronavirus Aid, Relieve, and Economic Security Act. Below are some thoughts specific to our industry that might be helpful to you:
- 2019 IRA Contributions: The 2019 IRA contribution deadline has been extended with the tax-filing deadline until July 15th. Make sure that you communicate with us if your contributions are intended to be for prior-year.
- Early Withdrawal Penalty Waiver: The CARES Act also waives the 10% early distribution on distribution of up $100,000 from IRAs and plans for individuals who meet the requirements of being affected by the coronavirus. The tax would still be due on pre-tax distributions, but could be spread evenly over three years, and the funds could be repaid anytime during the three years.
- 2020 RMDs: The Act included a waiver for required minimum distributions (RMDs) for 2020. This waiver applies to company savings plans and Traditional and Inherited IRAs. If you would like to stop your 2020 RMDs, please contact our office.
- Charitable deductions: The Act creates an above-the-line charitable deduction for 2020 (not to exceed $300) with a cash donation to charity, this particularly useful for those using the Standard Deduction on their tax return but still give. If you itemize your deductions, the bill also modifies the AGI limitations on charitable contributions for 2020, to 100% of AGI for individuals and 25% of taxable income for corporations. The bill also increases the food contribution limits to 25%. The prior AGI limit was 60% for individuals. Donor-Advised Fund Limits were unchanged, so if you are desiring to maximize the individual or corporate increases, the increased giving must be directly to a qualified charitable organization.
The Bill that was passed is over 800 pages long and covers many things from stimulus, to loan programs, to one-year changes in tax laws, and more. Please stay close to your accountants, attorneys, and bankers for applicable opportunities this Act provides. Feel free to reach out to us if you have questions as to how this Bill impacts you and if we don’t know the answer, we’ll point you to someone who does.
If you anticipate receiving a stimulus check, it would be a good time to prayerfully consider how best to use that money since it was not in anyone’s plans as the year started. If you haven’t been financially impacted by the COVID-19, perhaps consider extra levels of generosity to help those who have needs.
Thank you again for trusting us to walk with you on your stewardship journey.
Please take some time to watch this video blog from our Founder and President Ron Bare. He provides perspective on the coronavirus, the financial markets, and how to implement some Biblical wisdom in times of uncertainty. We hope that it will be a blessing and encouragement to you during this pandemic. Please pass it on to others to whom you think it will benefit.
On Thursday, Pennsylvania Governor Wolf ordered all non-life-sustaining businesses in Pennsylvania be closed as of March 19. Bare Wealth Advisors is complying with that request and our physical location is closed until further notice.
Although our physical location is closed, we remain committed to serving you throughout the unfolding coronavirus situation. We will all be working remotely and will have access to our email and voicemail during this time. If you need to contact us, please call the office number. If someone is unable to answer the phone, please leave a message and we will call you back promptly.
This in an unprecedented time in the life of our community, nation, and world. We are daily seeking the Lord for His guidance and are committed to praying for our leaders and all of those on the front lines of fighting this virus. We are also praying for you and your families – please feel free to reach out to us with any concerns or personal requests. We appreciate your understanding and patience, and we look forward to being able to meet with you again face to face soon.
We wanted to give you an update on Bare Wealth Advisors’ response to the developing coronavirus situation.
First, we want to keep lines of our communication open with you and be available to discuss any questions or concerns that you may have over the upcoming weeks. We understand the concerns you may have related to your investment accounts and the potential impact on your financial plan. If there are any short-term changes to your financial situation, please contact as soon as possible. In any situation, we will continue to provide advice based on the timeless principles in God’s Word.
Second, while we will remain open, we are limiting the number of in-office meetings we have. If you are scheduled in the next few weeks, we will reach out to you regarding your meeting. Based on various factors, we will be holding meetings via phone or Skype.
We will have staff available to receive any checks for deposit into your accounts. You can either mail these in or drop them off at the office. We will also have a licensed advisor available to speak to you via phone during our normal business hours.
While we think the size of our team and our office location are not conducive to spreading the virus, our first priority is the safety and health of our employees and clients. Also, as Americans we want to be part of the solution to minimizing the serious effects of this virus. By taking these steps, we can help protect our team and their loved ones, you our clients, and contribute to our country moving forward. This is a developing situation with governments both locally and nationally issuing updates, so we will keep you up to date on how these effects our day to day operations.
Additionally, if you are at a higher-risk of getting sick, please let us know if we can assist you in any way with getting items you may need for daily living.
As always, please do not hesitate to contact us with any questions or concerns.
The Bare Wealth Advisors Team
by Ron Bare
As mentioned in our previous blog, the Bare Wealth Advisors team believe in helping our clients make financial decisions flowing out of a comprehensive financial plan based on your values and goals. However, we do understand that the current health situation with the virus and also the implications of how this effects your financial goals is probably on your mind. With that in mind, we wanted to share a few thoughts on fear and also a few principles we believe.
Since fear levels in our country (and world) are at high levels, we thought it would be good to share some thoughts and principles related to fear and finances. I have heard that the Bible says do not fear (or be afraid) somewhere close to 365 times, one for each day. This is clearly to remind us that our nature is to fear the unknown and the circumstance we may be faced with. I was reminded in our church service this past week to read Psalms 91 (too long to type in this blog – I suggest going to the YouVersion Bible app to read). Reading this and other scripture is a great way to actively combat fear in our lives and for those we care about.
In addition, as we make financial decisions, we believe reviewing a few basic principles can be effective when we live in times of uncertainty. Here are a few to consider:
- God is the owner of all things, including our money (Psalm 24:1). This reminds us we are stewards and should work hard to manage what has been entrusted to us; however, we are not expected to have a crystal ball based on future events that may or may not happen.
- Live within your means and be content with what we have (Hebrews 13:5)
- Minimize the use of debt
- Build liquidity and have some money put back in savings for the unexpected and for income that you may need in the short term (our planning process accounts for these items)
- Think long term – the longer term your perspective typically will help you make better financial decisions. (Think back to the financial crisis of 2008 – 12 years ago, we have recovered well)
- Give generously – personally I believe this to be a very important step in coming up against fear we may have. Fear causes us to hold tight to what we have rather than have an open hand, look to help someone in need or bless a cause or mission you believe in.
In summary, one of our core values at Bare Wealth is Biblical wisdom. We believe that when we manage our lives and finances according to Biblical principles we can experience:
- Contentment under all economic conditions
- Confidence in financial decision making
- Maximize the use of money, our talents and time for what matters most to us
As always feel free to contact our team with questions on your plan/investments or concerns related to what is happening in our world, we care about you and your family.
Also, please pass this on to any family or friends who may benefit from reading this.
by Ron Bare
One thing I have learned, working in the financial services industry over the past 24 years, is by having your investment decisions flow out of a comprehensive personal financial plan, based on your values and goals, is essential to making wise decisions over time. The moment you separate your investment decisions and make them independently of a comprehensive financial plan is when those decisions are made based on emotions, news events, or other items that do not point back towards your values and goals.
If you have worked with Bare Wealth for any length of time, you know we believe in planning around our client’s purpose, values and goals and letting these items drive all decision making. However, we do understand when world events cause large movements in the financial markets, feelings of concern may arise regarding how these shifts may impact your objectives. With that in mind, we do not want to be silent when events, such as the coronavirus, influence the markets with an 11% drop in one week.
In case this has caused any concern (or fear) related to life or your finances, we want to assure you that unless your goals or short-term financial needs have changed, it is best not to react to these news events. Let your financial plan have the time it needs to properly help carry out your goals. As always, we are here to take any questions or inquiries surrounding these events. In the meantime, lets pray for the families impacted by the virus and pray that a solution would be developed to stop the spread of the disease.