One of our clients asked us this question last week and we thought you might be interested to hear the answer.
First of all, what is an RMD?
It is a required minimum distribution.
When do you need to take one? My December 2006 statement shows that I have an RMD due on April 1, 2007, and another December 31, 2007. How could I have two RMDs due in one year?
You are first required to take an RMD by April 1 in the year after you turn 70-1/2. Afterward, you are required to take future RMDs by December 31 of each calendar year. Essentially, you have an additional 3-month “grace period” (January 1-March 31) to take your first RMD.
Why do you need to take an RMD?
Basically, paying taxes is inevitable when it comes to your retirement assets. You can defer paying some income taxes by refraining from distributing your retirement assets, but you can’t do this forever.
Information was taken from Charles Schwab and Investopedia. Visit these sites to learn more.
We decided to make a few changes to our blog to make it better for you.
1- We will be posting one article each week on Wednesdays to give you the best content.
2- We will write about questions you have and topics you are interested in. This blog is for you and we want to write about things you’d like to learn about.
Feel free to leave questions or topic ideas in the comments section or email us at shannon at paragonwealth.com. You can also call us at 801-375-2500.
3- We will be starting a new blog that will be integrated into our new website that will have updates two to three times a week if you would like more information. The site will be up in July.
Let us know how we can make this blog more useful to you. We’d like to hear your feedback. Thanks!
At Paragon Wealth Management, we think it is important to publicize our performance numbers on a monthly basis.
Our two most popular portfolios are a conservative portfolio called Managed Income, and a growth portfolio, which is more aggressive, called Top Flight. Our 2008 numbers are listed below compared to their indexes or benchmarks.
2008 Performance Numbers
Managed Income Lehman B Top Flight S&P 500
Jan-08 -1.31% 1.68% -5.26% -6.00%
Feb-08 0.01% 0.14% -0.96% -3.25%
March-08 -0.16% 0.34% -3.08% -0.43%
April-08 2.19% -0.21% 6.8% 4.87%
May-08 1.07% -0.73% 3.91% 1.30%
Although, past performance is no guarantee of future results… you may be interested to see our past performance numbers.
Paragon’s Track Record
Managed Income Lehman B Top Flight S&P 500
2008 1.78% 1.21% 1.01% -3.80%
2007 2.24% 6.96% 16.98% 5.50%
2006 5.73% 4.33% 5.91% 15.79%
2005 5.72% 2.43% 6.30% 4.89%
2004 12.81% 4.34% 10.15% 10.87%
2003 29.55% 4.10% 50.31% 28.69%
2002 -3.72% 10.25% -13.60% -22.12%
2001 4 Qtr 9.65% 4 Qtr 0.05% 9.10% -11.92%
2000 — — 62.42% -8.82%
1999 — — 17.69% 20.66%
1998 — — 31.67% 28.58%
Click here to learn more about our investment services or call us at 801-375-2500.
An investor’s actual returns may vary due to timing of withdrawls, contributions and other factors. Past performance is no guarantee of future results. Before investing, contact Paragon to discuss your investment objectives, risk tolerance and fees. Investments in securities involve the risk of loss. The S&P Index is a market-value weighted index comprised of 500 stocks selected for market size, liquidity, and industry group representation. It is not possible to directly invest in this index.
In the past we have written articles about market forecasting. This article was written by Charles Martineau, and it goes right along with our philosophy on marketing forecasting. It was taken with permission from Invest by Simplicity.
“So where is the stock market going this year Charles?”
– I don’t know.
“Why don’t you know? Aren’t you supposed to be one of the top finance students at your university?”
– What do you mean by top? I have good grades, but that doesn’t mean I know where the market will go this year or next year… actually no one can!
– Do you know anyone who can actually predict where the market is going on a consistent basis?
“Well I thought someone could because of all the news on TV, etc… Those stock specialists sound smart, right?”
– Well they need to sound smart, otherwise they don’t get a pay check! I could give you lots of reasons why the market will go up or down by the end of the year.
“No, what do you think?”
– I still don’t know…
“I am confused!”
– PERFECT! Now you understand the market!
“What do you mean?”
– You are CONFUSED! That’s the whole point… the market is simply a weird non-sense confusing thing!
“I still don’t get it…”
I’ve had this this famous conversation a couple of times with my dad, family, and some school friends.
Everyone needs to realize that no one can predict the market and where it will be by the end of year or the next year or in three to four years.
There are two types of Stock Market Specialists:
1- Some who don’t know where the market will go
2- Others who haven’t realized yet that they don’t know where the market will go
Sounds simple right?
Not really because it goes against human nature for not knowing something. Humans seemed to be programed to find trends where there are actually none.
But why is the market really confusing? I could go into details, but I won’t.
Simply ask yourself:
“What is the market? or Who is the market?”
The population of the world is forming the market and since humans often act in manners that are so unpredictable, how can we predict the market? We can’t!
However, there’s something I can say for sure about “predicting” the market, if you can actually call this a market prediction.
In the past, Bull markets are followed by Bears but Bull periods tend to last longer than Bears… there you go!
Now everyone understands the stock market. Right?
Featured in Utah Valley Magazine’s May/June issue.
Hunter Dave Young is also a former world-class magician who toured for more than four years before becoming a successful entrepreneur and then a finacial adviser who owns Paragon Wealth Management in Provo. Dave is Utah Valley Magazine’s new columnist.
Five years ago Dave Young, owner of Paragon Wealth Management, made a goal to harvest a mountain goat that was among the world’s 10 largest. After two failed attempts to get the record-setting goat in Alaska, Dave set his sites on the British Columbia/Yukon border in the fall of 2006.
“Getting to where the world’s largest goats are takes an immense amount of concentration,” says Dave, whose first column in Utah Valley Magazine appears on page 111. “We were scaling 60-to-100-foot cliffs. It’s a mental game.”
After nine days of backpacking, David was finally able to harvest a mountain goat that ranked on the all time “Top 10 in the World” list. He retrieved the goat after it fell more than 2,000 feet into a ravine.
“It took a lot of patience and determination,” David says. “I learned a ton.”
Dave applies his hunting lessons to his very successful investment business.
Hunting the Stock Market
When he’s not hunting world-class trophies to hang in his Provo office, Dave spends his time managing his successful Top Flight Portfolio.
“What I enjoy most is the challenge of getting something that’s hard to get,” Dave says. “Anyone can go on a safari and shoot a zebra. I enjoy hunting leopards. They’re like mountain lions on steroids. They’re quicker, more aggressive and have a bad attitude. If you make eye-contact with a leopard — they’ll jump at you.”
Dave’s mantra of not taking the easy road translates into how he handles clients’ financial futures.
“It takes a great deal of focus and patience to manage money,” Dave says. “You can’t force the market to do what you want.”
While some financial advisers focus on selling their clients value-added services or simply on their personality, Dave has always relied on investing.
“What sets us apart from other financial advisers is that our fundamental roots lie in investing,” he says. “That has been our primary focus for the past 20 years.” The company does not sell any financial products.
And that effort has not gone unnoticed. Since its inception in January 1998 through December 31, 2007, the Paragon Top Flight Portfolio has generated a total return of 417.34 percent, crushing the 77.42 percent the S&P 500 has posted.
“That works out to a compound annual return of 18.03 percent for Top Flight, versus 5.95 percent for the S&P 500,” Dave says. See www.paragonwealth.com for Paragon’s full disclosure.
Most investment advisers are considered successful if they are able to simply beat the S&P 500.
Paragon’s Top Flight portfolio has far outpaced that standard in all economic conditions the past 10 years.
An investor’s actual returns may vary due to timing of withdrawls, contributions and other factors. Past performance is no guarantee of future results. Before investing, contact Paragon to discuss your investment objectives, risk tolerance and fees. Investments in securities involve the risk of loss. The S & P index is a market-value weighted index comprised of 500 stocks for market size, liquidity, and industry group representation. It is not possible to directly invest in this index.
Dennis, Trudy, Patrick, Shannon, Dave, Cathy, Kim, Nate
Congratulations Paragon Wealth Management! They received the 2008 Utah Best of State award in Business Services- Financial Services. Dave Young, President of Paragon, accepted the award on Saturday, May 31 at the Salt Palace Convention Center in Salt Lake City.