January 14, 2021
HAPPY NEW YEAR
The 2020 phrase “strange times” remains alive in this new year. Often during client meetings, we are asked about market expectations going forward. Our general response – in so many words – is we cannot predict how the economy will fare and whether stocks will be down or up as a result. However, we also point out that portfolios are positioned to weather both fierce and fair winds and that our sights are on the far horizon. (By way of example, one might think markets would react positively to good news and negatively to bad. So, how to explain why the Dow, NASDAQ, and S&P rose together January 6th while our Capitol was under siege?!)
We go about our business, though, believing in democracy and capitalism with all its imperfections. At Corner-stone, reflecting on the year, the first quarter brought a precipitous COVID-related market drop and a subsequent shift in operations as we all moved to working remotely from home (except Jill, whose office has always been home). For the most part, client meetings have been held via Zoom. Kudos go to all for adapting to new technology!
We grew as a company, adding Adam Bergeron early in the year to the Newington office. Adam is a Paraplanner who intends to sit for the Certified Financial Planner® board exam later this spring. Mackenzie Arsenault and Christina Traurig were both promoted to “Managing Directors”, as they now run much of the day-to-day business operations at Cornerstone. In November we offered a financial planning position to Sara Casale from New York, who joined us January 4th. The Newington office of nearly 17 years, having outgrown its space, is now the “Portsmouth office” and relocated to 210 Commerce Way (although Jill will still maintain her office in Newington). Brittany Landry and Danielle Pensinger are moved back from their home offices and hold down the Portland physical space at Union Wharf.
We also are proud to have met the criteria to certify as a B Corporation (more about this on the back page) and joined New Hampshire Businesses for Social Responsibility (NHBSR).
I signed up for mediation training at USM, and after being postponed from March to September, the course ultimately had to be conducted all online. Nonetheless, the subject is of high interest to me and I feel well suited for this work.
2021, although still “strange times”, is beginning to feel more familiar. Or perhaps we have just adapted to our new normal. Harkening back to the earlier comment related to stock market prognostications, whoever might have predict-ed the S&P 500 would pull itself from the trenches and close out the year with an 18% gain! We can’t know what the year will bring, but we are prepared for the challenge!
ARE YOU PROTECTING ALL OF YOUR ASSETS?
Did you know that digital assets are not addressed in the typical estate plan? If overlooked, your heirs may lose access to some treasured and valuable items at your death.
At its root, digital property is anything not physically accessible - pictures stored on your password protected computer, Facebook accounts, and emails. The situation gets complicated quickly if you use a service such as cloud storage (Google Drive, Box, etc.) or social media accounts. The Revised Uniform Fiduciary Access to Digital Assets Act (RUFADAA) provides a legal framework surrounding how your heirs or fiduciaries can gain access to your digital property after you pass away. The act also protects custodians of your digital property against the claims of your heirs if you don’t have a digital estate plan.
You may have unknowingly implemented part of a digital estate plan through tools like Facebook’s “Legacy Contact” where you can designate someone to take control of your account in the event that you die. This is the first place a company will look and it will overrule any wishes specified in your will! If you don’t use the setting, or the company doesn’t provide it, they will then look to see if your will has language specifically addressing digital property. As a last resort, the company will default to their Terms of Service, which almost always deny access to anyone but the original account holder. Your digital property or account access would be forever lost!
We suggest you create or update an accurate inventory of your digital assets, update any online tools you’ve used, and contact an estate planning attorney to add the required verbiage to your will. Finally, make sure to leave specific instructions for any assets with additional complexity such as cryptocurrency
held in cold storage or encrypted data.
Digital property is an increasingly important part of our lives and requires the same level of preparation as financial assets. If you need any more motivation, imagine your last Facebook or Instagram post living in perpetuity, representing the totality of you family’s digital inheritance.
INTRODUCING SARA CASALE
“It always seems impossible until it’s done.”
These words from Nelson Mandela serve as a reminder
not to give up in the face of adversity. Instead,
we can begin with a mindset of possibility. How can we
know what is truly possible until we try?
When I entered the finance industry with a background
in politics, I was worried I’d made a mistake.
Luckily, I had wonderful mentors in the industry who
encouraged me in those early days to look beyond my
background and to use the skills I did have to adapt and
learn. This experience brought invaluable “a-ha” moments
that not only empowered me to make smarter
financial decisions in my own life but inspired me to
share this knowledge with others. It’s been my mission
since then to break down all the financial jargon and
help others understand how to apply financial planning
to achieve their life goals.
As a financial planner, I enjoy getting to know what
clients want to achieve and the significance of each goal.
From here, we can build a plan and navigate through
any of life’s unexpected twists or turns along the way.
A lifelong resident of New York State, I decided it
was time for an adventure and moved to Portland at the
end of 2020. Outside of the office, my dog Zooey and I
can be found exploring our new city and finding new
favorite restaurants and breweries
around town. Coming from a big Italian
family always gathering, or rather
gathering around good food, is my
SO MUCH FOR MARKET FORECASTING
At the end of 2019, the median consensus was that the S&P
500 would rise 2.7% in 2020. And in April, after things went
south, they changed their tune and said it would fall 11% for
the year. Given, as noted earlier, the actual gain for the year
was over 18%, the forecasters were off by a whopping 26%!
Furthermore, each December since 2000, the median forecast
did not once anticipate a market decline; in fact about
29% of the time (in six different years over the last 20) returns
were negative. Negative years are fairly consistent since 1926
such that roughly 1 out of 3 years will be negative.
Certified B Corporations Declaration of Interdependence
We envision a global economy that uses business as a force for good.
This economy is comprised of a new type of corporation - the B Corporation - Which is purpose-driven and creates benefit for all stakeholders, not just shareholders.
As B Corporations and leaders of this emerging economy, we believe:
That we must be the change we seek in the world.
That all business ought to be conducted as if people and place mattered.
That, through their products, practices, and profits, businesses should aspire to do no harm and benefit all.
To do so requires that we act with the understanding that we are each dependent
upon another and thus responsible for each other and future generations.
WINTER READING LIST
Becoming - M. Obama
Breath - J. Nestor
Sketches from a Hunters Album - Turgenev
Essentialism: The Disciplined Pursuit of Less - McKeown
The Lying Lives of Adults - Ferrente
The Wisdom of Finance - Desai
Better Business—How the B Corp Movement is Remaking Capitalism