Our Opinion

October 2019

             For many years now, we see America’s economic and monetary progress is intertwined with exposing and opposing the agenda of the new Democratic (socialist) party. Donald Trump and his administration has been the voice of reason on many diverse matters. It is the multi-partisan, fake media and deep state apparatus – driven by powerful, stealthy, immoral, callous opponents of freedom and free enterprise – that are actually to be feared. They represent a mindless machine that continues to send the message that there are no rules and no limits, and with no other purpose other than seizing absolute power through socialism. Trump and his administration are standing up to it all.

             The extremely agitated political atmosphere of this administration was to a large extent inevitable, given the mandate this President received to make profound public policy changes, and to unmask the  bipartisan political class in its entrenched positions. There is a very long fuse that is burning with excruciating slowness toward the power cake of explicit revelation of democratic lawbreaking, and rank partisanship against the President. We see that every Democratic nominee has championed tax, immigration, healthcare, and environmental policies that the great majority of Americans will not seriously entertain, and excludes talks on reparations for descendants of slaves, and legalized infanticide. Thus far, most of the democratic party is sleep walking into an election that will become a fiery show of all the outrages and enormities of the last three years. It will be like an immense fireworks display, relentlessly mounting to a climax of eventual indictments, and an electoral landslide.

             Since Trump took office, the Dow Jones Industrial Average’s compounded annual return is approximately 15%, well above the historical average of 9%. We are in the midst of the longest running, bull market in history, fueled by low interest rates, historically low unemployment, reduction in household leverage, relatively low oil prices, a white-hot housing market, lower corporate and individual tax rates, deregulation, the very recent, informal resumption of Quantitative Easing (money printing), the reduction of dependence on government assistance programs, optimistic consumer confidence, and our recent attainment of our long-term goal of energy independence.

            Some pundits have been calling for recession since the last recession in 2008. Predicting a black swan event in the marketplace is next to impossible, and significantly altering investment strategy in anticipation can result in a loss of opportunity now and purchasing power in the future. Notwithstanding continued U.S. stock market volatility, we continue to position our clients for the slower continuation of this 11-year bull market, in accordance with each family’s risk tolerance. We will continue to be prudent in our recommendations, but financially plan for an optimistic moral, social, religious, and economic future for our country. We believe that continued economic expansion, more fiscal accountability and monetary responsibility will extend into Trump’s 2020 reelection years and confirm support of the way American capitalism was designed to work in our Constitutional Republic. Further, should the Democratic socialists and the dangerous, hypocritical, radical left lose enough seats in the House in 2020, we think a three-branch majority in Congress that supports traditional capitalism will significantly accelerate more, long-awaited changes.

             There comes a period in life when our remaining time on earth is worth more than exchanging it for additional income or to increase our net worth, which are called the retirement years. But the pre-retirement planning process is significantly hampered first and foremost by procrastination, and secondarily by the effects of inflation and taxes. Statistically, only 27% of Americans say they’ll be financially prepared for retirement. The average American needs between 75% and 85% of their pre-retirement, gross income in order to maintain their lifestyle in retirement, based on the assumption that spending declines in retirement. Social Security is the number one Federal entitlement program and provides up to 40% of an average retiree’s income. At MAP Estate Planning, we will assist you in increasing your total retirement income.

             Health problems are cited as the major reason for retiring earlier than planned. On the other hand, deliberately deferring retirement by one year, allows for an 8% higher standard of living for a couple, and the subsequent survivor. Housing represents the highest expenditure in the early years of retirement, but healthcare costs surpass housing costs after age 85. Important risk factors to retirement income include longevity risk, inflation risk, market risk, healthcare and long-term care risks, and declining cognitive abilities risk.

             By January 2020, state insurance commissioners have directed all insurance carriers to use the 2017 Commissioners Standard Ordinary (mortality) Table, in place of the 2001 CSO Table now in use. Further, an updated approach to how a life insurer is mandated to set aside funds, known as reserves, to pay insurance claims when they become due, will also be required. Reserves ensure that carriers are adequately capitalized on the insurance business they are putting in place. The new mortality table will play into the new increased reserve requirements such that many current products and riders must be repriced in order to be compliant. The net effect is projected to be an increase in premiums ranging from about 1% to 8%, depending on the varied pricing of the different life insurance products among the many competing carriers. These upcoming changes will not affect any insurance plans now in force, or any pending policies placed in force prior to December 31, 2019.

             As the Fall season is fully underway, we’d like to express our appreciation for your business, for your trust in us, and loyalty to MAP Estate Planning.

              We wish you a happy and healthy holiday season.


            Ann, Steve, and Anthony Ziniti