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Investment Commentary: December 2019

BY: FRANK HOSSE
Director of Investments – Argent Trust Company  |  615.385.2720

Global stocks continued their upward trend in November. The MSCI ACWI Index, a common measure of both developed and emerging-market stocks, gained 2.4% in the month. This index broke through highs not seen since early 2018. U.S. stocks continue to lead returns across the world, gaining 3.6% in November. Amazingly, the S&P 500 Index closed at a record high 11 times during its 20 trading days in November. Foreign equity markets were positive in November but unable to match the returns of U.S. stocks. Developed international stocks gained 1.1%, while emerging-market stocks edged lower by 0.1%.

Currently, every underlying sector of the S&P 500 has a positive year-to-date return (2013 was the last calendar year where all sectors were also positive). The majority of sectors are clustered around the S&P 500’s gain of 27.6%; however, technology and energy are outliers on either end. If the tech sector return holds, it would be the sector’s best calendar year return this decade—a fitting end to a decade that has been dominated by technology and tech-related businesses. Whether many of these businesses thrive in the 2020’s remains to be seen, but it will be hard for their share prices to match the sector’s 17% annualized return this decade.

 

 

 

 

 

 

 

 

 

As is typically the case with investing, there is always something to worry about—and that “something” continues to be a trade war between the U.S. and China. Hong Kong’s pro- democracy party won 85% of the seats in the local elections, a massive increase on the 25% seen in 2015. A few days later, Donald Trump signed the Hong Kong Rights and Democracy Act into law, triggering tension in Beijing as the text supports the demonstrators. This development is making it tricky to finalize the US-China trade truce, especially as Beijing has only offered very gradual changes to intellectual property rights for the 2022-25 period. A “phase one” trade deal was supposed to be agreed upon in November, but negotiations continue to drag on and uncertainties linger. The two sides have about two weeks to agree on terms before the United States is set to impose another round of tariffs on Chinese goods on December 15.

In the fixed-income markets, the U.S. Treasury yield curve steepened last month following a Federal Reserve rate cut late in October, which brought the short-end of the curve lower, while the longer-end inched up during the month. Most bond markets were flat to negative in November. The U.S. core bond index lost 0.1% but is still up an impressive 6.7% year to date. High-yield bonds and emerging market bonds were mixed, gaining 0.3% and losing 0.5%, respectively. At this point, bond markets don’t expect the Fed to cut for a fourth time when their December meeting concludes.

Certain material in this work is proprietary to and copyrighted by Litman Gregory Analytics and is used by Argent Financial with permission. Reproduction or distribution of this material is prohibited, and all rights are reserved.

The Morning View: December 6, 2019

BY: MARSHALL BARTLETT
Senior Vice President / Portfolio Manager


Announced this morning, the economy added 266,000 jobs in November, well above forecasts. Additions occurred in manufacturing, health care, and motor vehicles, given the adjustments from the recent auto strike. The unemployment rate ticked lower one tenth to 3.5% and Average Hourly Earnings increased 0.2% for November and 3.1% on an annual basis. Furthermore, Average Weekly Hours worked remained at 34.4. Overall, a strong headline number highlighting a stable job market, with low unemployment and moderate wage increases. With the Federal Reserve currently on hold with respect to interest rate policy, the labor market continues to support steady, moderate economic growth in the months ahead. Meanwhile, the back and forth trade negotiations between the U.S. and China remain in focus for the markets as the upcoming December 15th deadline for additional tariffs looms. In all, bond yields ticked higher following the report and equity futures are also higher heading into the market open.

 

 

 

 

 

 

 

 

 

 

This material is intended to be for informational purposes only and is intended for current or prospective clients of Argent Trust Company. This information is obtained from sources believed to be reliable, and its accuracy and completeness are not guaranteed. Information does not constitute a recommendation of any investment strategy, is not intended as investment advice and does not take into account all the circumstances of each investor. Forward-looking assumptions are Argent Trust Company’s current estimates or expectations of future events or future results based on proprietary research and should not be construed as an estimate or promise of results that a portfolio may achieve. Actual results could differ materially from the results indicated by this information. Investments can go down as well as up. Past performance is not a reliable indicator of future results.

How Your Charitable Donations Can Have the Greatest Effect

BY: MINDY HIRT
Vice President / Wealth Advisor
(615) 385-2718 
|  mhirt@argenttrust.com

Mindy Hirt

With the holiday season now in full swing, many of us are thinking about what we can do to help the less fortunate.

Charitable giving feels good to do and can make a big difference to organizations that rely on donor contributions for a large portion of their operating budgets. Around this time of year, there tends to be an increase in “checkbook giving” — writing a small check to a charity, sometimes in response to a mail solicitation. It’s quick to do and requires very little effort.

As we’re planning our donations, though, it’s good to keep in mind how a well-considered financial strategy can make these charitable dollars go further, as well as provide some benefits back to the donor in the form of tax breaks. Many of our clients at Argent are charitably inclined. Whenever we know someone has an interest in giving, whether it is to a religious organization, educational institution, health and human services or other nonprofit, we have conversations about tax-advantageous ways to help those donations have the greatest effect.

Here are a few of the most popular options available:

Donating stock or other property: By donating stock that has increased significantly in value since it was purchased, you can receive important tax benefits. The primary one is avoiding a tax of up to 23.8 percent that you’d normally pay if you sold the stock (the 20 percent capital gains tax, plus the Affordable Care Act tax of 3.8 percent). A charity, on the other hand, could receive the stock as a gift from you, sell it and pay zero capital gains tax. This benefit also applies to other types of assets as well.

IRA distributions: We have a number of clients with individual retirement accounts (IRAs) who are age 70½ or older and must take minimum required distributions from their accounts. Distributions are normally taxed at the IRA owner’s ordinary income bracket — which could be as high as 37 percent, meaning the person may only receive 63 percent of their money after taxes. By giving some or all of your IRA distribution to charity (up to $100,000 per year), you can fulfill the yearly distribution requirement while making your dollars go further than they would if you received them directly.

Donor-advised funds and foundations: Donor-advised funds can be a smart way to receive the tax benefits of a charitable contribution even if you haven’t decided on a recipient for your money. The barrier to entry for opening a donor-advised fund is low — only $5,000 — and once you’ve made the contribution, it can be maintained for your lifetime. One important note: Once you contribute to a donor-advised fund, it’s technically no longer yours, so you can’t change your mind about donating. However, you can designate what charities receive distributions and the amount. Management fees for these funds are in the 1 percent range, which is very affordable.

Private foundations also allow donors to make a gift in the current tax year without selecting a specific charity as a recipient. Foundations are more complex to set up than donor-advised funds but are intended to last for multiple generations and allow donors a higher degree of structural flexibility. Foundations also differ from donor-advised funds because minimum distributions of 5 percent annually must be distributed to charitable beneficiaries.

Charitable lead trusts/charitable remainder trusts: Charitable trusts can also be a way for clients to structure donations and receive income. With a charitable lead trust, a charity receives distributions from the trust for a finite time — 10 or 20 years, for instance — after which the beneficiaries receive any remaining assets. A charitable remainder trust works the opposite way — beneficiaries receive income from the trust for a lifetime or specific number of years, after which the principal is donated to charity.

Timing donations: With the 2017 tax reform, the timing of when you donate is even more important. Clients can often benefit from “bunching” or “bundling” their charitable gifts for a number of years into one taxable year. This strategy allows the donor to itemize deductions in the year of the “bundled” charitable gift (often done through a donor-advised fund) and use the standard deduction in those years that donations are not made. In total, the deductions can be maximized over multiple years.

Each donor’s personal financial picture and charitable goals will ultimately make the difference in which route they choose. The first step should be a conversation with a wealth advisor who can offer personalized recommendations before the donor meets with their CPA or attorney.

The Morning View: November 19, 2019

BY: MARSHALL BARTLETT
Senior Vice President / Portfolio Manager

 Announced this morning, Housing Starts indicated there were 1.314 million units started in October, an increase of 3.8% over the previous month. While a bit below forecasts, units rebounded from previous levels and growth was seen in both single family and multi-family homes.  Meanwhile, Building Permits indicated there were 1.461 million permits issued in October, an increase of 5.0% over the previous month, above forecasts.  While housing is only a small portion of GDP, less than 4%, it is an interest rate sensitive portion of the economy and it is reassuring to see it rebound given the recent rate cuts by the Federal Reserve.  Should housing figures continue to strengthen, it could provide additional support to the slow growing economy in the months ahead.  In all, bond yields ticked slightly lower following the report and equity futures remained higher heading into the market open.

 

This material is intended to be for informational purposes only and is intended for current or prospective clients of Argent Trust Company. This information is obtained from sources believed to be reliable, and its accuracy and completeness are not guaranteed. Information does not constitute a recommendation of any investment strategy, is not intended as investment advice and does not take into account all the circumstances of each investor. Forward-looking assumptions are Argent Trust Company’s current estimates or expectations of future events or future results based on proprietary research and should not be construed as an estimate or promise of results that a portfolio may achieve. Actual results could differ materially from the results indicated by this information. Investments can go down as well as up. Past performance is not a reliable indicator of future results.

The Morning View: November 15, 2019

BY: MARSHALL BARTLETT
Senior Vice President / Portfolio Manager

In this morning’s data, Retail Sales for October rose 0.3% slightly higher than the 0.2% expected. Strength was seen in autos and non-store retailers. The Control Group, which excludes sales for food, autos, building materials and gas stations, also rose 0.3% in October, matching forecasts. However, the control group for the previous month was revised lower to -0.1%. Overall, even with the previous month revised lower, consumers continue to carry the load for the economy as the manufacturing sector and business investment have waned in recent months. Uncertainties surrounding trade negotiations, impeachment hearings, the upcoming election, and “Brexit” will likely continue to weigh on the minds of business leaders in the months ahead. As a result, the  consumer will remain in focus, especially as we head into the holiday season. In all, bond yields have ticked slightly lower following the report and equity futures are higher heading into the market open.

This material is intended to be for informational purposes only and is intended for current or prospective clients of Argent Trust Company. This information is obtained from sources believed to be reliable, and its accuracy and completeness are not guaranteed. Information does not constitute a recommendation of any investment strategy, is not intended as investment advice and does not take into account all the circumstances of each investor. Forward-looking assumptions are Argent Trust Company’s current estimates or expectations of future events or future results based on proprietary research and should not be construed as an estimate or promise of results that a portfolio may achieve. Actual results could differ materially from the results indicated by this information. Investments can go down as well as up. Past performance is not a reliable indicator of future results.

Avoiding the Debt Trap for Your Child’s Higher Education

Originally published on Kiplinger.com on November 8, 2019

BY: DAVID REDDING, CTFA, AEP
Austin, TX Market President, Argent Trust Company | (512) 478-3188

It is the dream of many parents for their children to attend college after graduating high school. However, as many of us have experienced, the cost of higher education continues to climb and is making it difficult, if not impossible, for many families to send their children to college.

I witness this frustration in many of my clients as we work through financial plans to take care of their needs today and their goals in retirement, while also funding educational expenses for their children and grandchildren. It’s increasingly challenging to guide my clients through a plan that will allow them to successfully navigate all of these goals, primarily due to the rising cost of higher education.

According to U.S. News and World Report, the average cost of tuition and fees in 2019-20 for private colleges is $41,426. At public colleges, it’s $11,260 for in-state residents and $27,120 for out-of-state students. When room and board, transportation and other expenses are added in, the average cost of a four-year education from a state school, for in-state residents, can be greater than $100,000. The average cost of a four-year private university can easily exceed $250,000. Though most schools provide scholarships or financial aid to reduce the overall “sticker price,” the cost can still be daunting.

Start saving early

If you believe your child or grandchild will attend college, the first step is to start saving early. I almost always recommend a 529 college savings plan. These plans are easy to use, allow for tax-free or tax-deferred growth, and are offered by most mutual fund companies.

A great tool to research different state-sponsored 529 plans is www.savingforcollege.com. This site provides a lot of information on how to best save for college and get the most out of a 529 plan. Bottom line, $250 a month put into a plan earning 7% for 18 years should grow to around $100,000, which may not cover all the cost of college, but it will certainly help.

In many cases, debt is the only way to pay for the high cost of a college education, but I recommend to my clients to avoid debt if at all possible. Post-graduation debt is at an epidemic level in this country. According to the College Board, the average student debt balance for four-year public schools is $26,900, and $32,600 for private schools. This debt is carried by the student and does not include any debt that their parents might have also incurred to put their children through school — possibly jeopardizing their own retirement. So, start saving early!

Is college the right fit?

The second step is determining if your child will really benefit from a four-year degree, or if some other type of job experience or trade school might be a better fit. The days of going to college for the “experience” is a thing of the past. It is simply too expensive.

Parents should also determine if their child is ready for college. Many are. However, a year or two in college at a cost of $25,000 to $50,000 per year can be a big waste of money if the child doesn’t know what they want to do, or simply isn’t ready for the rigors of college-level classes. A “gap year” (or two) is becoming more the norm, giving young adults valuable life skills in a full-time job for a year or two out of high school. In many cases, they can save money to partly defray the cost of attending college.

I can assure you that young adults who use their own money to pay for tuition, books or even spending money will be much more frugal than their parent-funded colleagues!

Understand your ROI

Third, figure out the real cost of college and the potential return for the degree that is being sought. This can vary greatly, but determining a “return on investment” is necessary, due to the high cost — and is especially important if any debt will be carried by the graduate after college. What is the cost versus the most likely salary for a position in the field they are studying? What is the predicted need for jobs in the field of interest upon graduation?

I frequently work with couples who make too much money to qualify for grants or FAFSA assistance. In their cases, their child is often not in the top 10% of their class and didn’t score in the top tier on the SAT or ACT; therefore, the child is not eligible for performance-based scholarships, and is also not a five-star athlete being recruited to play Division I sports on a full ride. Unless there is a large amount of family money from which to pay the expense, we have to get creative.

One family’s creative solution

One client of mine was able to achieve their child’s desire of going to the college of her choice — and did so in a very financially responsible manner. Their daughter was bright, but not in the top 10%, so automatic acceptance to the university she wished to attend was not offered. She wanted to go to Texas A&M University, which her father and great-grandfather attended, but the competition was very tough.

She decided to deviate from the traditional path in high school of taking the AP and pre-AP classes that could give her GPA a boost. Instead, she took “dual credit” classes that were offered by a local community college at her high school. She graduated high school with 24 college credits, almost a full year! The cost of these college classes amounted to the cost of the books she needed to buy, so they were basically free.

She then enrolled in Blinn College, a two-year school that is known to work closely with Texas A&M to help students transfer when their two years of mostly prerequisite work are done. She completed all of her core classes at Blinn, made excellent grades, and was accepted into the Education program at Texas A&M to complete her junior and senior years.

The tuition at Blinn was $2,500 per semester, versus $7,500 at Texas A&M. The total cost of her four-year degree will be approximately $65,000, or roughly half of what four years at Texas A&M would have cost, including tuition, fees, expenses, room and board, and transportation.

I share this story as an encouragement to show that there are unconventional ways to accomplish the same goal. With the cost of higher education continuing to rise, more and more of these unconventional paths will need to be explored. So, start saving early and do everything possible to avoid the debt trap for education.


David E. Redding, Market President and Senior Wealth Advisor at Argent Trust Company, helps clients navigate the complex world of estate planning, trust administration, wealth transfer and closely held business strategies. His 30 years of experience in the industry give him a depth and understanding to tackle real life problems faced by high net worth families as they plan for the transition of business interests and wealth to future generations.

Why a Lifetime Trust Might Make Sense for Your Family

BY: CORT H. BETHMANN, JD, LLM
Wealth Advisor, Argent Trust | (615) 591-4002

When I partner with clients and their attorney to set up their estate plans, one question that comes up frequently is the best strategy for passing their wealth to their children after their death.

The answer to that question can be different in each family situation. Some of our clients choose to give their money as an inheritance. Others structure their trusts so that when their children reach a certain age, the trust starts paying out portions of the principal, and the remainder is provided after the parent passes away.

Many of our clients aren’t aware that there’s a better option available — lifetime trusts. These are truststhat, as the name indicates, last through the lifetime of their beneficiaries.

Despite a host of reasons why a lifetime trust might be in your beneficiaries’ best interest — a few of which I’ll go through in a moment — clients hearing about them for the first time often wrestle with the idea. There’s a general perception that giving assets to your children in trust conveys the underlying message that they aren’t trustworthy. Because of that, many clients prefer to give their money outright as long as their children are old enough to handle the responsibility.

But leaving money in a lifetime trust has nothing to do with trustworthiness. A well-maintained trust can support a family for decades to come, ultimately giving your beneficiaries all the control they could want, while providing them some important protections as well.

One key benefit of a lifetime trust is that it can ensure that a family’s money stays protected in case of a divorce. When a mother and father set up their trust, they intend for their money to go to their son or daughter, then on down the biological tree.

However, consider the possibility that after you give your assets outright to a son or daughter, they are divorced from their spouse. All those assets could be brought into the marital estate and divided between your child and their ex-spouse. You may love your daughter-in-law or son-in-law, but you probably also want your children to keep the wealth that you’re passing down to them.

Other scenarios could be that a son or daughter gets in an accident or hurts somebody, gets into debt or has a business deal that goes bad. In those cases, assets handed down from their parents would be subject to creditors — unless they’re kept in trust. These situations are the kinds of things you think will never happen, until they do.

One major issue surrounding trusts is who ultimately has control over the money. Clients often want their children to be the designated trustee — and in many jurisdictions, including Tennessee, where I’m located, the laws do allow for a trust’s beneficiary to serve in that role. Although the money is held in trust and the trustee has to abide by certain rules to access it, they can make distributions from the trust for their own health, education, maintenance and support needs.

I suggest to my clients that, if they choose to go this route, they first sit down with their children and communicate the reasons why they want to leave their money in trust. The key is communication — explaining to the children that this arrangement isn’t a negative reflection on them, and legally protects them from unexpected future life events that may threaten to take away their inheritance.

If you decide to put your money in a lifetime trust, one important thing to know is that once in place, it’s irrevocable — meaning that it can’t ever be altered. So it’s very important to have a good team of legal and financial advisors involved in creating the trust to make sure that everybody is on the same page.

In many client situations, the benefits of a lifetime trust far exceed the drawbacks, providing your family financial protection and control for many decades to come. If you’re considering a lifetime trust for your family, I’m glad to answer any questions or discuss them with you further. Give me a call at (615) 591-4002.

Finding Your Financial Footing: A Widow’s Journey

BY: NICOLE JACOBSEN-NALLYCTFA
Louisville, KY Market President  |  (502) 569-7400

Losing a spouse is a life-changing, traumatic event. While your sorrow will subside over time, most widows face a new challenge: managing an uncertain financial future. A study by the U.S. Government Accounting Office showed that a widow’s household income fell by 37 percent, while a widower’s declined only 22 percent.

During my career as a fiduciary trust and investment advisor I’ve worked closely with many families and widows. When I lost my husband in 2018, my experience and training helped, but didn’t seem to make my journey any easier. It did, however, demonstrate just how unique is every widow’s grieving process and also just how similar.

It made me realize that I needed to take the time to mourn – and that I needed to wait at least a year before I made any big changes, especially financial changes. I also learned to embrace the four tasks of mourning that J. William Worden describes in his book “Grief Counseling and Grief Therapy.” I’ve modified these a little, but I agree with Worden that widows should complete each task so the process of mourning is completed. Worden advises widows to:

  • Accept the reality of the loss
  • Experience the pain of the loss
  • Adjust to the changes in the new reality
  • REINVEST in the new reality

Every widow’s experience is different and so is the length of time each will take to substantially complete this process. Here are five lessons I learned during my journey that I hope will help you make better financial decisions after losing your spouse:

1. Find an advisor or someone you trust

If you are not already working with a financial advisor, then find someone you trust to help navigate the many challenging tasks you face. Even simple tasks, such as closing a bank account, can be overwhelming. The inability to make decisions is a true “grief response” for many widows. Having a trusted person near you or on-call to support you will help alleviate some of the stress from losing your spouse.

Once you have identified your trusted advisor, now is the time to lean on that person for advice, guidance and, most importantly, support. Don’t give in to your feelings that you are alone. If you are working with an attorney for probate or estate administration, have that person file any claims on your behalf. Both professionals will protect you from being taken advantage of during this difficult time in your life.

2. Hold off on making financial decisions

DO NOT make any unnecessary financial decisions during the first year. Period. This includes changing investments and/or purchasing any new financial instruments (for example, stocks, bonds or real estate). I can’t stress this enough. It is easy to think that you must find your “new normal” quickly to start to heal, but it will be many months before you are equipped to figure that out.

3. Understand the value of your financial assets and liabilities

Financial goals for widows vary by circumstance and situation. The primary initial goal should be to become familiar with your assets and debts and to get into a routine of paying household expenses (if you didn’t already manage paying the bills). Once you’ve been doing that for a year you will have a clear understanding of your total financial picture (income, expenses, assets and debts) and will be in a much better position to determine and adjust to your new financial goals.

4. Get help with life insurance claims

Typically, the funeral home can file a claim on your behalf for life insurance proceeds or assist with completion of claim forms. Let them do it if they provide this service. Any funds received during the first year should be maintained as cash (and invested in a money market fund) until sufficient time has passed. Again, I recommend waiting at least a year – the time may vary depending on your situation – before you make changes to how the funds are managed or invested.

If it falls on you to file your life insurance claim, contact the insurance company yourself, by phone or online, to request and complete the claim forms and avoid the local insurance agent. You should shield yourself from well-meaning agents trying to sell you investment products that are not in your best interest.

5. Hold off changes to your Social Security benefits

If your spouse was entitled to monthly Social Security checks, you must report the death and stop those payments. Although you have up to one year to file a claim for survivor benefits, if you know you need to file a new claim, call and make an appointment that is at least a month out to sit down with a Social Security officer.

Use that time to manage household bills. Keep your expenses to a minimum to “keep the lights on,” so to speak. It typically takes several weeks to receive a certified death certificate to file a Social Security survivor claim anyway, so take that time to catch your breath. You may want to take your trusted advisor with you to the appointment.

Grief is a journey and it’s tough work. Be gentle with yourself and remember that what you are going through is normal. Find support from your family, but also consider using local grief counseling services to help you understand the roller coaster of stress and emotions you are experiencing.

Reinforcing Our Commitment to Fiduciary Excellence

Providing a fiduciary level of service is central to Heritage Retirement Plan Advisors. To further prove our commitment to always putting our clients’ best interests first, we recently passed a rigorous, multi-month audit by the Centre for Fiduciary Excellence (CEFEX). The elite certification is granted only to investment advisory firms that demonstrate conformity to a recognized global standard of fiduciary excellence. There are currently 137 certified investment advisory firm worldwide. We are the only certified investment advisory firm in Oklahoma.

The process was guided by “Prudent Practices® for Investment Advisors,” an industry-recognized handbook grounded in law, regulation and professional best practices. The standard describes how an investment advisor assumes the responsibility for managing a client’s overall investment management process, which includes selecting and monitoring funds, as well as developing processes to implement investment strategies and fiduciary processes.

For clients, this means we uphold the highest level of fiduciary care – and that has a direct effect on you, your plan and your employees. As your advisor, we help plan sponsors with fulfilling their fiduciary duties as outlined by the Department of Labor.

  • Act solely in the interest of plan participants and their beneficiaries and with the exclusive purpose of providing benefits to them;
  • Act prudently in the faithful performance of all duties;
  • Follow the plan documents (unless inconsistent with Employee Retirement Income Security Act;
  • Diversify plan investments; and
  • Pay only reasonable plan expenses.

The CEFEX certification is another important way to demonstrate that we always act in our client’s best interest. Our prudent, transparent process directs all of our actions to assure effective stewardship of your assets, conforming to the highest professional standards of conduct.

Click here to learn more about Heritage Retirement Plan Advisors.

Heritage Retirement Plan Advisors Earns Fiduciary Excellence Certification

MEDIA RELEASE
Contact: Taryn Clark, Marketing & Communications Manager
Heritage Trust Company | 405.608.8899

 

OKLAHOMA CITY, Oklahoma, Sept. 18, 2019 – Heritage Retirement Plan Advisors is honored to announce its Investor Advisor Certification from the Centre for Fiduciary Excellence, LLC (CEFEX). The certification, which can be viewed at www.cefex.org, is granted by CEFEX only to investment advisory firms and financial service providers that demonstrate conformity to a recognized global standard of fiduciary excellence. Heritage is the only CEFEX certified investment advisor in Oklahoma.

To earn CEFEX certification, Heritage underwent a rigorous, multi-month audit and certification process guided by “Prudent Practices® for Investment Advisors,” an industry-recognized handbook grounded in law, regulation and professional best practices. The standard describes how an investment advisor assumes the responsibility for managing a client’s overall investment management process, which includes the selection, monitoring, and removal of funds, as well as developing processes to implement investment strategies and fiduciary processes.

“CEFEX is pleased to add Heritage Retirement Plan Advisors to an elite group of investment advisors who have demonstrated adherence to professional practices that define a standard of fiduciary excellence,” said CEFEX Managing Director Carlos Panksep. “They have earned the right to use the CEFEX Mark which indicates the firm’s established practices are aligned with investors’ interests and worthy of trust and confidence.”

“For more than 10 years, Heritage Retirement Plan Advisor’s mission has stayed true to providing clients with unbiased guidance and transparency with the highest ethical standards,” said Brad Knowles, managing director of Heritage Retirement Plan Advisors. “We applied for CEFEX certification because our retirement plan clients deserve proof of fiduciary process and transparency about the quality of their investments. It’s also necessary in today’s world, as ‘fiduciary’ can be a confusing word. Passing this strict audit certifies that we work in their best interest as prudent plan fiduciaries and provide effective stewardship of their assets.”

CEFEX certification standards are substantiated by legislation, case law and regulatory opinion letters from the Employee Retirement Income Security Act (ERISA), the Investment Advisers Act of 1940, the Uniform Prudent Investor Act (UPIA), the Uniform Prudent Management of Institutional Funds Act (UPMIFA) and the Uniform Management of Public Employee Retirement Systems Act (UMPERSA) in the U.S. A full copy of the standard can be downloaded from CEFEX at www.cefex.org and the certificate and assessment results can be viewed by clicking on the “Registration” tab and searching for Heritage Retirement Plan Advisors.

About CEFEX®
CEFEX®, Centre for Fiduciary Excellence, LLC, a Fi360® company, is an independent certification organization. CEFEX works closely with industry experts to provide comprehensive assessment programs to improve the fiduciary practices of investment stewards, advisors, recordkeepers, administrators and managers. CEFEX is based in Pittsburgh, PA. Learn more at www.cefex.org via Twitter or on LinkedIn.

About Heritage Retirement Plan Advisors
Heritage Retirement Plan Advisors, part of the Argent Financial Group family of companies, offers investment and fiduciary services exclusively to sponsors of retirement plans. Since 2008, Heritage has been providing plan sponsors with unbiased advice and transparency with the goal of improving participant outcomes. For more information, visit www.heritage-401k.com.

About Argent Financial Group
Argent Financial Group (AFG) is a leading independent fiduciary wealth management firm. Responsible for more than $21 billion in client assets, AFG provides individuals, families, institutions and businesses with a broad range of wealth management services including trust administration and related services, investment management, family office services, retirement plan and charitable organization administration, mineral (oil and gas) management, and financial, retirement and estate planning. The company was also recently named for the second year in a row to the Inc. 5000 list of the fastest-growing companies in the U.S. AFG is the only financial services company in Louisiana to make the prestigious list. For more information, visit www.ArgentFinancial.com.

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Michael Romero Joins Heritage Trust Company in Oklahoma City as Vice President and Relationship Manager

MEDIA RELEASE
Contact: Taryn Clark, Marketing & Communications Manager
Heritage Trust Company | 405.608.8899

OKLAHOMA CITY, Oklahoma, August 13, 2019 – Heritage Trust Company announced today that Michael Romero has joined the company as vice president and relationship manager in the Oklahoma City office. He will assist clients in a variety of areas, including trusts, probate and estate planning and administration.

Romero joins Heritage from the Baptist Foundation of Oklahoma, where he has worked since 2001. He served as vice president, trust counsel until 2016 when he was promoted to senior vice president, chief development officer. While there, he was responsible for supervising staff, budget maintenance, monitoring various communications/marketing efforts and participating in cross-team collaboration.

“Mike brings with him an abundance of valuable financial experience, as well as a trust background. He will provide an influx of new ideas and perspective to our clients,” said Kevin Karpe, president of Heritage Trust Company. “His expertise in charitable giving and philanthropy will also be an invaluable addition to our team.”

Romero is also an adjunct professor at the University of Central Oklahoma, where he teaches courses in estate planning and administration and business law. In addition, he is an active member of Council Road Baptist Church.

“I couldn’t be more excited to join Heritage and to continue working with the local philanthropic community,” said Romero. “What drew me to Heritage was how well respected it is for providing exceptional, fiduciary client services. I hope to use my experience to help charitable organizations achieve their missions and look forward to doing so with such an outstanding firm.”

Romero earned his bachelor’s degree in business administration from Oklahoma Baptist University and his Juris Doctorate degree from the University of Oklahoma College of Law. He is also a member of the Oklahoma Bar.

Romero and his wife, Laura, have been married 26 years and have four children. In his free time, he enjoys watching his kids play sports, reading a good book or exploring the Oklahoma terrain on a hike.

About Heritage Trust Company
Heritage Trust Company, part of the Argent Financial Group family of companies, offers trust administration, oil and gas management, real estate management, financial planning and investment management services to individuals, for-profit companies and charitable/non-profit organizations. The Oklahoma-based company has offices in Oklahoma City, Ponca City and in Tulsa under the AmeriTrust brand, which serve clients in the United States and several countries around the world. For more information, visit www.heritagetrust.com.

3 tips for improving your retirement plan’s fiduciary file

Originally published on BenefitsPro.com on July 31, 2019

BY: LINDE MURPHY, CRPCTM

Managing Director, Institutional Services  |  (210) 352-2428

Linde Murphy

It’s that time of year for many retirement plan sponsors as they put the finishing touches on Form 5500, the annual employee benefits report required to be filed with the IRS. It’s also an ideal time for sponsors to take a deep dive into the retirement plan fiduciary file to improve documentation and avoid any compliance-related squabbles with Uncle Sam.

Many employers underestimate the value in having a comprehensive, well-organized fiduciary file — the 20-30 agreements, contracts and written plans that compose any retirement plan. The effort spent organizing your files will give you more time to find ways to improve the plan. Just think: No more scrambling to find or update plan documents at the last minute when filing your 5500.

Remember that you, as plan sponsor, are responsible for keeping your company’s retirement plan in compliance. Here are three best practices to make sure the fiduciary file helps you accomplish that goal:

1. Always have a fiduciary file checklist

Every plan sponsor needs to have a comprehensive checklist of all documents — and where those documents are located — in the fiduciary file. Yes, this should be obvious, but you’d be surprised at how many plan sponsors have an incomplete list and/or can’t easily locate required documents.

Confer with your retirement plan advisor to make sure you have all the necessary documents on file. The more time spent finding documents means less time helping employees with their retirement savings needs. Here’s a sample of the documents that should be included in your checklist:

 ●  Regulatory audits: The plan adoption agreement, Form 5500, IRS opinion or determination letters, fidelity bond agreements, trust agreements, investment policy statements, lists of all fiduciaries, trustees, consultant and plan administrator agreements

●  Administrative functions: Corporate board resolutions, board meeting minutes, fiduciary roles and responsibilities

●  Investment monitoring: Investment account statements, investment committee meeting minutes (if applicable)

 ●   Participant communications: Section 404a-5 participant fee disclosure, automatic enrollment notices, QDIA notices and event communications

This list just scratches the surface, but as you can see, there’s a forest of paperwork that has to be organized. The checklist is your go-to document to keep you organized. It also will serve as a constant reminder of what files you — and anyone else who is involved in managing your plan — need to keep current.

2. Document procedures, processes and roles

A word of advice on managing processes and procedures for something as complicated as a retirement plan: If it’s not written down and documented, then you haven’t done it. Just ask any auditor.

Written documentation of operational procedures is essential so everyone involved with your company’s plan administration can see how important processes are managed. These documents function as the primary resource guide and describe the key roles, responsibilities and tasks so the team understands who’s doing what, how it’s being done and when it’s getting done. Written documentation also provides auditors with necessary evidence to show how your company is managing the plan.

3. Make reviewing your fiduciary file a quarterly priority

Far too many employers look at reviewing their fiduciary file as an annual event. Don’t fall into that trap. A lot can change in a year — new federal regulations could be adopted, employee demographics could change due to staffing needs or executives involved in plan governance could leave the company.

Reviewing your plan quarterly will help to assure that you follow the terms of your plan. Many plans conduct a quarterly investment review, but few go beyond just the investments. Take advantage of these review meetings by adding fiduciary training, reviewing any issues that surfaced the prior quarter, and discussing upcoming changes.

Managing your company’s retirement plan can be a challenging, thankless task. But when you follow these tips, you’ll sleep better because you will have a plan that’s properly documented and working in the best interests of your employees.

Linde Murphy, CRCP, serves as managing director for Argent Retirement Plan Advisors, a Registered Investment Advisor with the SEC that specializes in providing fiduciary and investment advisory services to employer sponsored qualified and non-qualified retirement plans. Linde, who has more than a decade of experience in the financial services industry, works with corporations, nonprofits and municipalities to design high quality and cost-effective retirement plans. Prior to joining Argent, she was chief operating officer and chief compliance officer of M.E. Allison & Co., an investment banking firm specializing in municipal finance.

Argent Retirement Plan Advisors, LLC is a Registered Investment Advisor registered with the Securities and Exchange Commission. A current copy of our written disclosure statement is available at no cost upon request.