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The Morning View: February 27, 2020

BY: MARSHALL BARTLETT
Senior Vice President / Portfolio Manager

Announced this morning, the first revision of GDP growth for the fourth quarter 2019 was 2.1%, as expected.  The quarterly increase in core Price Consumption Expenditures (PCE) was 1.2%, slightly lower than expected.  In addition, initial jobless claims for the previous week were 219,000, higher than expected, but still in the low 200k range.  Overall, this data reminds us that while the economy is growing, it is at moderate levels and inflationary pressures are benign, and this is before the impact of the spread of the Coronavirus (COVID-19) globally, causing markets to react in recent days.  Until there is some clarity of the impact on the global economy and how world leaders will respond, market volatility will likely continue.  We continue to monitor these events, keeping in mind individual risk tolerances and long-term goals.  In all, bond yields ticked lower this morning and equity futures are also lower as we head 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.

Just Because You Can Doesn’t Mean You Should: Why You Need a Corporate Trustee

Originally published to the Winter 2020 edition of The Southerner, a newsletter of the Southern Cremation & Funeral Association

BY: DEBBIE HOLMES
VP & Trust Officer-Funeral & Cemetery Trusts, Argent Trust Company | (318) 251-5856

The adage “Just Because You Can Doesn’t Mean You Should” is advice given to someone who is not using their resources in a wise way. Here in the South we also hear it used as advice given to someone regarding their wardrobe or questionable activities. It means even though there are things you can do; it does not always mean it is the best choice to do them.Debbie Holmes

There are some states that currently allow or have previously allowed you to act as your own trustee. Sounds good, right? You are saving money on those trustee fees! But is it a wise decision to not engage a trust professional, especially in an industry as complex as ours?

Trust companies and banks with trust departments are required to become “eligible” to serve as a trustee for Funeral Home and Cemetery trust accounts. A trustee may be eligible to serve in your state for any other type of trust but may be prohibited from serving in our industry due to additional qualifications. A corporate trustee that is eligible to serve in your state already has the stamp of approval from your regulators!

Corporate trustees bring a wealth of knowledge to the table. In the Funeral and Cemetery trust profession, the knowledge is specialized since it is state-specific. It is part of a corporate trustee’s job to monitor any legislative changes that will affect trust administration. Large trust companies will have a dedicated staff, often including an attorney, monitoring the states in which they are qualified. They will also provide career Funeral and Cemetery trust professionals that handle the day to day administration of your account. These individuals are familiar with all areas of trust administration and are also responsible for having the specialized knowledge for the states they serve.

Another reason to use a corporate trustee is to gain connections to other Funeral and Cemetery trust professionals such as tax preparers, investment managers and record keepers. Your trustee should have a preferred tax preparer who is experienced with Funeral and Cemetery trusts tax preparation. This can be a money-saving feature because a trustee is able to negotiate a lower fee due to the volume of business.

A corporate trustee has a fiduciary duty to act solely in the interest of their clients both legally and ethically. When you hire a corporate trustee, you gain an unbiased advisor to add to your team to help your business succeed. A corporate trustee in our industry has the honor of assisting you in serving your communities.

You may be allowed to forgo a corporate trustee, but you could let a corporate trustee serve you as you take care of your business.

3 Ways the SECURE Act Could Change Your Retirement Plan Strategy

Originally published on fwtx.com on February 3, 2020

BY: KATHY CHRISTOFFEL, CTFA
Market President, Argent Trust-Fort Worth Market
(817) 502-3586

New regulations passed by Congress and signed into law by President Trump at the end of 2019 contain several provisions that could have a significant financial impact on your retirement savings.

The changes are included in the Setting Every Community Up for Retirement Enhancement Act (SECURE Act), which went into effect on Jan. 1. This landmark legislation marks the first major step forward by regulators in more than 10 years that is designed to help Americans save for retirement.

It’s welcome news for many Americans, especially those who are struggling to build their nest egg or simply don’t know the best approach to save for retirement. A survey by the CFP Board, a financial planning trade organization, found that nearly half of adults (48 percent) said they are not setting aside money for retirement. The same poll also revealed that two in three adults said they are not receiving retirement planning advice from a financial professional.

As you might expect with federal regulations, there are rules that will help the average American, but also provisions that are less taxpayer friendly. Provided below are three important changes to IRS regulations on retirement accounts. Please consult with your financial advisor so you know how it will affect you.

1. Age Restrictions on IRA Contributions Removed

One of the best features of the SECURE Act is that individuals who are still working past traditional retirement age can contribute to a traditional individual retirement account (IRA) as long as they receive earned income. The old regulations prevented individuals from adding to their IRA after they reached 70 ½ years of age. That’s great news for the growing number of retirement-age Americans who are still working.

2. Age Increased For Required Minimum Distributions

Another benefit of the Act is the age that individuals must begin required minimum distribution (RMDs) from their IRAs – or the minimum amount that must be withdrawn each year from an account – was increased to 72 years of age from 70 ½. Unfortunately, anyone who reached age 70 ½ in 2019 or earlier cannot take advantage of the change. The IRS also left in place a 50 percent penalty on any distribution shortfall below the RMD.

3. “Stretch” IRAs No Longer Allowed

Now for the bad news. The IRS has placed a significant restriction on inherited IRAs, commonly referred to as “stretch IRAs.” All funds held in an inherited IRA must now be distributed by the end of the 10th calendar year following the year of the IRA owner’s death. Under the old rules non-spousal beneficiaries were allowed to “stretch” the RMDs over their life expectancy. The change could have a negative tax effect on beneficiaries in their 40s or 50s, who can no longer stretch RMDs over decades. Fortunately, the IRS left unchanged rules for surviving spouses if they choose to become the owner of the IRA instead of the beneficiary, in which case the surviving spouse’s normal RMD timeline applies.

The SECURE Act ushers in some welcome – and much needed – improvements to help individuals protect and grow their wealth. I urge you to meet with your financial advisor and review your retirement plan to make sure you are on the right path to meet (and hopefully exceed) your financial goals.

About the author: Kathy Christoffel serves as market president for Argent Trust Company’s Fort Worth wealth management team where she oversees business development and provides client solutions. A certified trust and financial advisor, Kathy has 27 years of experience as a trust and wealth management professional. She is also involved with several professional organizations, including the American Bankers Association, Tarrant County Probate Bar and Institute of Certified Bankers

The Morning View: February 7, 2020

BY: MARSHALL BARTLETT
Senior Vice President / Portfolio Manager

Announced this morning, the economy added 225,000 jobs in January, more than expected.  Both the construction and health care industries were strong, while manufacturing remains weak.  The unemployment rate ticked higher by one tenth to 3.6% as people re-entered the workforce.  Average Hourly Earnings increased 0.2% in January and have increased 3.1% on an annual basis, slightly higher than expected.  Overall, a strong headline jobs number with wage growth increasing, but at a very moderate pace, suggesting little upward pressure on inflation.  The Federal Reserve is likely to remain on hold with their accommodative policy.  In all, bond yields and equities are both lower early in today’s trading. 

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.

Argent Financial Group Employee Spotlight – Lance Johnson

Introducing the Argent Financial Group Employee Spotlight! Every two weeks, a different employee will be featured. For our first Q&A, meet Lance Johnson.

Q: What led you to Argent and what makes it unique?

A: In 2014, Heritage Trust’s Oklahoma City oil and gas division had an issue arise and the VP of the department recruited me and another professional to help — we’ve both been here since.  Argent and Heritage is a combination of equals, and its family atmosphere makes it unique. Many firms descend into corporateness, but Argent has steadfastly maintained its close internal family/relationship business model.

Q: Why do you enjoy working at Argent?

A: One, for the unique reason above, but most of all because our department’s president, David Luke, is a macro manager. He expects and respects hard work, a willingness to tackle big issues and commitment to the myriad of tasks required to effectively operate a successful, client-oriented oil and gas department. And he empowers all his staff members to accomplish these goals.

Q: What does the company mean to you?

A: It means a daily opportunity to enter a beautiful building, provide a large number of client requirements and interact with top-quality business professionals who also enjoy the company — as shown in their demeanor and attitudes.

Q: Share a favorite memory from your time at Argent?

A: It is a collective memory — having a small, but very satisfying role in helping families maximize the financial benefits from their oil and gas mineral ownership.

Q: If you could have any other job for one day, what would it be?

A: A Big 5 Photo Safari guide in Kruger National Park, South Africa.

Q: What is your favorite quote?

A: “The poorest way to face life is to face it with a sneer. A cynical habit of thought and speech, a readiness to criticize work which the critic himself never tries to perform, an intellectual aloofness which will not accept contact with life’s realities — all these are marks, not … of superiority but of weakness. It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.” Theodore Roosevelt, April 23, 1910, 3 p.m. at the Sorbonne, Paris.

The Morning View: January 31, 2020

BY: MARSHALL BARTLETT
Senior Vice President / Portfolio Manager

In this morning’s data, Personal Spending grew 0.3% in December as expected. Personal Income increased 0.2% in December, slightly lower than expected. The core Personal Consumption Expenditures (PCE) deflator, a measure of inflation that excludes food and energy, increased only 1.6% on an annual basis. Overall, spending and income had modest increases in December, but are likely enough to continue to support the current, moderate level of economic growth. The first reading GDP growth in the fourth quarter 2019 was 2.1%, as announced yesterday. In addition, inflation remains benign and below the 2% target set by the Federal Reserve, suggesting no change to the accommodative monetary policy currently in place. In all, bond yields are slightly lower and equity futures are also lower 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. 

Is Now a Good Time To Refinance My Mortgage?

Answer these 5 questions to determine if refinancing makes financial sense

BY: KENNY BROWN, Jr.  Vice President / Business Development, AmeriTrust
& LAURIE SAINT, CPA®  Assistant Vice President / Financial Planning, AmeriTrust Investment Advisors

Mortgage rates have taken another dip and it may have you wondering if now is a good time to consider refinancing your mortgage. Today’s rates, which are around 4 percent, are low by historical standards. According to home ownership analytics firm Black Knight, more than 6.8 million homeowners could save money by refinancing now.

There are several important considerations to review when determining if you should refinance. These include your current mortgage interest rate, credit score, lender and loan amount. It’s also critical to factor in closing costs, which include credit fees, appraisal fees, points (fees paid to a lender at closing for a lower interest rate), insurance and taxes, escrow and title fees and lender fees.

While every person’s situation is unique, here are five questions to answer to determine if you should refinance:

1. What is your goal?

For example, are you interested in changing the terms of your mortgage to pay off the balance more quickly or do you want to take out equity for home improvements? It may or may not make sense to refinance your mortgage depending on your goal. The savings from refinancing should be enough to recover the closing costs within 18 months to justify refinancing your mortgage. Planning to pay off credit card debt with equity from your home also may make financial sense. However, if you continue to have a substantial balance every month, then I would advise against using a home line of credit or mortgage refinancing to pay off your credit card debt. Knowing your behavior and working with advisor who keeps this in mind when establishing your goals is important.

2. How do I evaluate the cost?

The most important consideration when evaluating cost saving is the interest rate you are paying on the current loan versus the new mortgage. The cost of borrowing is impacted by many factors, including your FICO score, which looks at the history of when you received credit, the amount of credit you have outstanding, how much of that credit have you used and whether or not you have paid that credit back on time. This is the score lenders use to determine your creditworthiness. If your FICO score has decreased, then you may not be able to take advantage of prevailing lower rates and could receive a higher rate than what you currently have.

Unfortunately, it can be expensive to refinance, but you can make a more informed decision by simply asking your lender to run a break-even analysis to better understand how long it will take for the monthly savings to recover the costs to refinance. Do not forget to negotiate refinance costs. You may be able to have the mortgage company waive the appraisal fee or other miscellaneous expenses, which could reduce the benefit of refinancing.

3. Is a life-changing event anticipated?

Next, consider if the break-even point will occur during the time you expect to be living in your home. It is unlikely to be worth the cost to refinance if you’re planning to move before getting to your break-even point. According to the data collected from a 2018 US Census questionnaire, the top five reasons why Americans move are: 1.) they want a new or better home/apartment; 2.) they want to own their home; 3.) other family reason; 4.) new job or job transfer; and 5.) they want less expensive housing.

4. How are the mortgage terms changing?

Are your rates fixed versus a variable rate? A variable rate introduces an element of the unknown if interest rates go up at a time when your financial picture may have changed and you may no longer afford your mortgage payment. Rather than refinance your mortgage, one option may be to simply shorten the number of repayment years. You may also be able to save the cost of refinancing by setting up bi-monthly payments with the mortgage company.

5. How many years remain on the unpaid balance?

Under current tax law, with the increase in the standard deduction advisors may encourage their clients to pay down their mortgage. However, if the terms of your mortgage are considered long-term (10 years or more), tax law reform that is ending in 2025 – which provided us with a much lower tax rate – could change, which may negatively affect the refinancing decision. Tax laws change and it has a direct impact to the cost/benefit of refinancing your mortgage.

There are many variables that must be considered, and every situation will depend on your individual set of circumstances. But if you work with a financial advisor and answer these questions, you’ll be in a much better position to make the right decision.

The Morning View: January 23, 2020

BY: MARSHALL BARTLETT
Senior Vice President / Portfolio Manager

In this morning’s data, as expected, the European Central Bank decided to keep the deposit rate unchanged, at -0.5%, and monthly bond purchases will remain at 20 billion euros.  The statement following their meeting noted ongoing, but moderate economic growth in the Euro area, with weaker manufacturing and a firm labor market.  They will also conduct an overall review of their policy strategy.   Overall, continued accommodation from the ECB as inflation remains elusive, with some similarities to conditions in the U.S.  Meanwhile, initial jobless claims in the U.S. were 211,000 for the previous week, slightly below expectations, suggesting a continued firm labor market here at home.  In all, bond yields are little changed and equity futures are lower this morning 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: January 16, 2020

BY: MARSHALL BARTLETT
Senior Vice President / Portfolio Manager

Announced this morning, Retail Sales for December rose 0.3%, as expected. Strength was seen in gasoline stations, clothing stores, and building material retailers, while motor vehicle & parts dealers were weak. The Control Group, which excludes sales for food, autos, building materials and gas stations, rose 0.5% in December, above forecasts. Overall, a nice rebound in the control group figures from the previous month, which is used in the calculation of GDP. Consumers appear to have maintained their spending levels as we moved through the holidays, suggesting the economy will continue its moderate pace of growth in the months ahead. In all, bond yields ticked higher 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. 

Financial Planning for the Senior Marketplace

BY: DAVID RUSSELL, CFP®, CSA®
Vice President & Trust Officer  |  (601) 707-0008

David Russell

With the new year, I’ve entered my 36th year in the financial services industry. Just writing this fact feels strange. I’ve never characterized myself as a veteran of the industry, feeling instead that I’ve just hit my stride. The years however tell me differently and it’s easy to understand how senior professionals can feel marginalized. I chose a doctor several years my junior so that as I aged, he’d still be in practice. Understandably now, clients want to know who my back up is “just in case.”

The financial planning industry has done an admiral job of preparing people for two pivotal moments: Retirement – that magic age when one stops earning a paycheck, travels the world, plays golf every day, and enjoys a life of leisure; and Death – the final moment beyond which our assets and legacy are left to our heirs. It has done a poor job of equipping advisors to address the financial planning issues of the period in between. Sure, advisors sell long term care insurance to forty and fifty-somethings for this period, and others sell annuities to seniors skittish about the financial markets, but these are product solutions aimed at the senior market, not financial planning discussions. In a similar way, a walker solves an issue with balance and prevents falls, but a walker is not a comprehensive plan for health and wellness throughout life.

While there are several common financial planning issues for every age demographic, there are also many unique financial planning needs of the senior market.

It’s tempting to ask how a plan for continued social engagement is a financial planning issue. With social isolation a major contributor to poor health among seniors[1], and healthcare costs absorbing a significant portion of a senior’s resources, a plan for social engagement as we age should be an integral part of the financial planning conversation with seniors.

Annual Medicare elections are another example of an often-confusing labyrinth of decisions that can have significant financial impact for years.

Identity theft and elder financial fraud are estimated to cost seniors between $3 and $30 Billion a year[1], and nearly everyone I know over age 70 has been targeted. A plan that includes identity theft protection as well as vulnerabilities to undue influence inside of familial relationships needs to be included.

Plans for living arrangements, whether aging in place, or facility care should be discussed long before the actual need arises. Just as saving for retirement doesn’t begin at age 65, neither should plans for where someone lives out the remainder of their life be delayed until the 11th hour.

Family meetings to discuss an aging client’s dependency plan should be also be held long before a dependency event occurs. It helps assure family members that a plan is in place, informs them as to who-does-what-when, and when done early enough and under the direction of the aging client, preserves his or her seat of honor at the head of the table.

Family Business Succession has been a central component of financial and estate planning for years and is the least neglected area of financial planning for seniors among those who own a multi-generational family enterprise. Still, nearly 60% of the small business owners surveyed by Wilmington Trust, do not have a succession plan in place[2].

In conclusion, financial planning does not end at retirement. As one client reminded me years ago, “retirement is just another word for thirty years of unemployment.” It doesn’t look the same for all seniors but when practiced with integrity, it can be extremely beneficial to the entire family, and rewarding for the financial planner who chooses to serve this market.

David W. Russell, CFP®, CSA® is Vice President and Trust Officer with Argent Trust in Ridgeland, Mississippi.


  1. National Institute on Aging. (2020). Social isolation, loneliness in older people pose health risks. [online] Available at: https://www.nia.nih.gov/news/social-isolation-loneliness-older-people-pose-health-risks [Accessed 7 Jan. 2020].
  2. Consumer Reports. (2020). Financial Elder Abuse Costs $3 Billion a Year. Or Is It $36 Billion? [online] Available at: https://www.consumerreports.org/cro/consumer-protection/financial-elder-abuse-costs–3-billion—–or-is-it–30-billion- [Accessed 7 Jan. 2020].
  3. Usatoday.com. (2020). Most small business owners lack a succession plan. [online] Available at: https://www.usatoday.com/story/money/usaandmain/2018/08/11/most-small-business-owners-lack-succession-plan/37281977/ [Accessed 7 Jan. 2020].

Fixed Income Commentary – January 2020

4th Quarter 2019 and 2019 Fixed Income Review

Fixed income markets had mixed performance in the 4th quarter of 2019, although returns for the year were quite good considering the historically low rates available and U.S. equity markets being near all-time highs. A better outlook for global growth, trade policy progress, and continued benign inflation were contributing factors.  Additionally, world central banks, including the U.S. Federal Reserve, signaled more accommodative policies, with the latter cutting the overnight rate three times in the second half of the year.

Below are some 4th quarter and 2019 Bloomberg Barclays fixed income index returns:

The 10-year U.S. Treasury (UST) Note, a bell-weather measure used in the fixed income markets, ended 2019 with a yield of 1.92%, a marked decrease from 2.68% the previous year.  However, that yield was quite a bit higher than the 2019 10-year UST yield low of 1.46%, which was the lowest yield level since 2016.  In addition, the UST yield curve “steepened” during the quarter as short-term yields increased less than longer-term yields as global bond yields rose in general.  The 2-10-year UST yield spread differential, an often-cited measure of the slope of the yield curve, ended 2019 at 35 basis points, the widest since 2018. That same yield spread was 5 basis points at the end of the third quarter (and in fact briefly inverted for a period of about a week) and has averaged almost 100 basis points for the past five years.

The chart below shows the changes in the UST yield curve from the end of 2018 (gold line) and the end of 2019 (green line).  The bar graph at the bottom shows the changes in yields for select maturities.

Following several years of overtly hawkish interest rate guidance, the Federal Reserve Open Market Committee (FOMC) signaled a complete shift in monetary policy earlier in 2019, citing deteriorating economic conditions and continued low inflation (below their 2% target).  As such, the FOMC reduced its Federal Funds target rate three times, each by 25 basis points. The Federal Funds target rate currently sits at 1.50-1.75%.

In their most recent meeting in December, the FOMC left interest rates unchanged and signaled that they would keep them on hold through 2020 amid a solid economy.  The FOMC highlighted that while factory gauges have weakened, they expect consumers to keep the expansion going. In following, the committee stated  that they will continue to monitor the implications of incoming information for the economic outlook, “including  global developments and muted inflation pressures.”

At their December meeting, the FOMC updated predictions for GDP, inflation and unemployment. The Fed’s median estimate for the core Personal Consumption Expenditures (PCE) Index, the Fed’s preferred inflation gauge, is expected to be 2.00% in 2021, unchanged from the prior projection. In addition, the median estimate for GDP in 2020 is 2.00% and 1.90% in 2021, both unchanged from the last estimates.  The unemployment rate is expected to remain near an historically low 3.50% in 2020, the same as it is now.

Foreign sovereign bond yields moved higher in Q4 2019, on better global growth expectations, and global negative yielding debt has decreased to around $11 trillion from almost $18 trillion earlier in the year.  The U.S. fixed income markets have yet to witness the negative yield phenomenon and most domestic pundits, including the Federal Reserve, do not expect negative interest rates in the U.S. At present, the use of negative interest rates is an extraordinary monetary tool being implemented by some central banks with untested results and unknown long-term repercussions.

Below, in blue, are 10-year bond yields from several foreign countries (sorted from low to high).  Note the wide difference between the yield of the bellwether German Bund (the German ten-year note) at -0.23%, which had a record low yield of -0.74 in early September, compared to the U.S. ten-year note at 1.87% currently. This marked disparity in yields is indicative of divergent monetary policies as well as differing economic outlooks domestically and abroad.

We would be remiss not to mention a marked increase in Federal Reserve overnight operations to address an ongoing liquidity issue which recently came up toward the end of the third quarter. To avoid a “cash crunch” in the overnight lending markets, the Fed has been injecting billions of added reserves in the form of repurchase agreements or “repos” to offset intermittent spikes in the overnight lending rate. There are several explanations for this recent development, with the most plausible pointing to a combination of larger reserve requirements at the money center banks and increased Treasury issuance to fund burgeoning deficits at the federal level, all exacerbated by more lucrative overnight lending opportunities in the other markets. Recent statements by the Fed Chair, Jerome Powell, downplayed any structural weaknesses in the domestic financial system. He further stated he expected the Fed’s intervention to gradually wane toward the end of the first quarter of 2020. While no obvious problems were indicated in overnight operations at year-end, we will continue to monitor and report upon this ongoing development.

While always seeking opportunities during periods of market dislocation, we continue to recommend that our core fixed income portfolios maintain high credit quality and shorter, more defensive, durations. Admittedly, a more aggressive duration posture would have returned a bit more in 2019 but we continue to feel the potential upside is outweighed by paltry cash flows available in longer dated bonds with interest rates at current levels. We believe a core fixed-income strategy utilizing high quality individual bonds (where appropriate) evenly “laddered” over several years, and replacing maturing bonds with longer maturities, provides a good offset for riskier assets or strategies in a well-diversified portfolio. Along with this “volatility dampening” characteristic, a laddered individual bond portfolio also provides dependable cash flow and a source of liquidity which may be accessed as more lucrative opportunities become available in other sectors. As always, potential individual bond purchases are screened for sustainable financial strength, conservative debt coverage ratios, and other favorable characteristics.

As mentioned in our previous quarterly review, these are very unusual times in the financial markets. An unprecedented amount of central bank intervention with historically low (and even negative) interest rates, as well as overt political pressure for added accommodation at a time when sovereign deficits balloon to historic levels globally, is a challenging environment to traverse.  In following, for most fixed income accounts, we currently recommend a broad diversification of strategies, both conservative and more opportunistic, as a means of preserving capital, creating cash flow, and pursuing positive risk-adjusted returns. We hope you will contact your portfolio manager, or any member of our fixed income team, with questions or comments, or to discuss our thoughts further.

__ __ __

For more information about this investment commentary, please contact one of the following:

Sam Boldrick, Director of Fixed Income, Argent Trust
Hutch Bryan, Senior Portfolio Manager, Argent Trust
Oren Welborn, Portfolio Manager, Argent Trust

Not Investment Advice or an Offer
This information is intended to assist investors. The information does not constitute investment advice or an offer to invest or to provide management services. It is not our intention to state, indicate, or imply in any manner that current or past results are indicative of future results or expectations. As with all investments, there are associated risks and you could lose money investing.

5 Questions to Answer When Reviewing Your Retirement Plan

BY: MARK HARTNETTJD, CFP®, AEP®
Managing Director, Argent Family Wealth Services | (662) 550-4443

Congressional approval of the landmark Setting Every Community Up for Retirement Enhancement Act (SECURE Act) serves as a great reminder to retirees about the importance of revisiting your retirement plan to make sure you are meeting your financial goals.

The SECURE Act, which was signed into law on Dec. 20, 2019, is a game changer and ushers in some of the biggest improvements to our country’s retirement system in 13 years. For retirees, the Act increases the age for required minimum distributions and eliminates age restrictions for contributions to traditional individual retirement accounts (IRA). Those are two examples of how the legislation will affect retirement plans.

If you are planning to retire or are already retired, it’s always wise to reassess the underlying assumptions of your retirement plan with a financial advisor. Here are five questions to ask when reviewing your plan:

1. Are the underlying assumptions of your retirement plan still valid?

Times change and so should your retirement plan. The SECURE Act is a perfect example of how you need to review your plan whenever new laws are approved. One new provision in the Act limits the time frame for required minimum distributions for beneficiaries of an IRA. If your plan includes a “stretch IRA” strategy, you’ll need to make an adjustment. Remember, a retirement plan serves as the road map for your financial future. It will help manage risk and also take advantage of opportunities that come your way.

2. Have your healthcare needs changed?

Healthcare expenses will eat up a significant chunk of retirement savings so it’s essential that you watch those costs like a hawk. Even with Medicare, a healthy 65-year-old couple who both live into their late 80s will spend an estimated $606,337 on healthcare, according to HealthView Services, a health care cost-projection software company. Medical expenses are unpredictable. Adjust your retirement plan if your healthcare needs change.

3. Do you have a safety net for emergencies?

Everyone should have an emergency fund to pay for large, unexpected expenses or loss of income. Having sufficient funds set aside for emergencies is critical during retirement so you don’t tap into the savings you’ve worked so hard to accumulate. A widely used rule of thumb is to have 12-18 months of expenses in an emergency account.

4. Do you have the right investment portfolio structure?

For most people, investments held in retirement accounts – 401(k)s, IRAs and similar tax-deferred accounts – represent the majority of their nest egg. Your retirement is at risk if you are not protecting the value of those assets – and maximizing income and capital appreciation –through proper diversification. Have your financial advisor perform a stress test on a regular basis to make sure your investments can tolerate a major stock market correction.

5. Should you reassess your giving?

One of the greatest acts of kindness is giving to others in need. Consider making financial gifts now rather than as part of your legacy. Is there a family member who could use financial help? Is there a charity or special cause that would benefit from a larger donation now instead of smaller contributions over several years? A retirement plan check-up can help you transfer wealth in a meaningful, purpose-driven manner without jeopardizing your retirement.

A retirement plan is a dynamic document. Revisit it regularly – at least once a year – to see if you are still meeting your savings, spending and giving goals. If you’re off track, find out why so you can correct your course and feel confident about your financial future.

Mark Hartnett, JD, MBA, CFP®, AEP® currently serves as Managing Director of Argent Family Wealth Services, a division of Argent Financial. His practice focuses on providing leadership to financially successful families and family offices that desire to grow their family balance sheet through multi-generational planning in order to overcome the proverb “shirtsleeves to shirtsleeves in three generations.” Mark and his wife Jo-Shannon have been married twenty-eight years and live in Oxford, Mississippi, with their three children.