blog Archives - Longview Financial Advisors

How the Banking Failures Unfolded

Written by Wes Johnson on March 27, 2023. Posted in blog, Investment Planning, News.

Note: This market review was published on March 24th, 2023 and may not be reflective of current market or investing issues.

I am sure you, like me, have been watching the unfolding events in the banks over the last couple of weeks with a level of apprehension. At the heart of the issue is the banking system’s exposure to rising interest rates. There are larger problems than rate exposure at the banks, however it is unclear if these problems would have been exposed without higher rates. By and large, the banking system is well capitalized and lending standards have been high at most banks. This is not a situation like 2008 where banks were stuffed full of bad loans and had a credit quality problem. The quality of the loans at the banks are government securities and are of the highest quality. The problem is that they are holding long duration assets that are sensitive to changes in interest rates.

Take a look at the losses investors experienced in bond portfolios last year. The banks have similar losses in the bonds they are holding. Because of accounting rules, banks don’t have to acknowledge these losses in the held-to-maturity (HTM) portion of their balance sheet. The problem occurs when deposits are removed from banks and those bonds have to be sold at a loss to cover those deposits. A new facility that was enacted by the Treasury will provide help to these banks by allowing them to place these underwater bonds at the Federal Reserve at full price. This is a collateralized loan for a year; it has to be paid back with minor interest.

The bigger issue is that this has become more complicated by Janet Yellen segmenting the small and regional banks. Janet Yellen told senators that uninsured deposits (deposits over the FDIC limit) will only be refunded at banks that pose a systemic risk to the financial system. In essence, she has reinforced a two-tiered banking system that harkens back to the “too big to fail” days of 2008. If your bank is big enough to be deemed systemically important then you will continue to receive government assistance when things get tough. If you are a smaller bank then you must fend for yourself and good luck. As you would expect, this will mean that deposits will be moved from smaller regional banks and move to larger money center banks. This adds a lot of potential uncertainty around banks that operate in rural parts of the country that are not serviced by larger banks.

If you do not have deposits over the FDIC limit, then you don’t have to worry about the security of the deposits even if something were to happen to your bank. Another alternative over the last year that has gained popularity is money market funds. You can buy a government money market fund that is yielding higher than deposit interest rates. While these do not have a guarantee from the FDIC, they are holding US government securities, and therefore, are backed by the same entity that is guaranteeing the deposits through FDIC. At Fidelity, we utilize two separate money market funds and they are both of the government security variety.

I want to provide some insight into how Silicon Valley Bank (SVB) found itself in this situation. If you are not interested in these details, please feel free to stop reading here.

First, it is worth asking how SVB got into this situation. SVB was the banker of choice for numerous Venture Capital and start-up companies. They attracted a number of these businesses with “innovative” (risky) practices. These new companies came in with lots of deposits well over the FDIC limits resulting in the bank having the majority of deposits uninsured. When they took in the deposits from these new businesses, they bought a lot of treasuries and mortgage-backed securities (MBS) while interest rates were low. They held these in a part of the balance sheet called held-to-maturity (HTM). Because these treasuries and MBSs were intended to be held until the bonds matured at par, they did not have to report losses on the bonds when the Federal Reserve started raising rates.

SVB is not alone in this situation, and many banks have seen the value of their HTM bonds decrease in value. SVB was also not one of the 15 largest banks that require stress testing. As a part of that testing, the 15 largest banks are required to disclose how much interest rate risk they have.

When venture-backed companies became concerned, they began withdrawing their deposits quickly, resulting in around $42 billion dollars leaving the bank in a single day. This was a classic run on the bank. Because of who these depositors are, they were able to move a massive amount of money in a short period of time. SVB attempted to find additional capital, but was unsuccessful, leading to the FDIC closing and taking over the bank the following day.

It is unclear how the next events will play out. Government officials have stated the necessity of having a robust small banking system. I expect we will see changes over the coming months that will try and bolster the banking system. It is also unclear if this will change the Federal Reserves interest policy and quantitative tightening policy. I am writing this ahead of the next rate decision, but I suspect that Jerome Powell will have something to say about recent events. This added turmoil does highlight the importance of being diversified and having a plan. As always having a long-term approach, staying diversified, and remaining calm lets you take advantage of uncertainty, not held captive by it.

Disclosure: Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Longview Financial Advisors, Inc.), or any non-investment related content, made reference to directly or indirectly in this newsletter will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this newsletter serves as the receipt of, or as a substitute for, personalized investment advice from Longview Financial Advisors, Inc. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Longview Financial Advisors, Inc. is neither a law firm nor a certified public accounting firm and no portion of the newsletter content should be construed as legal or accounting advice. A copy of the Longview Financial Advisors, Inc.’s current written disclosure statement discussing our advisory services and fees is available upon request.

As we express our gratitude, we must never forget that the highest appreciation is not to utter words, but to live by them. ~John F. Kennedy

Written by Jessica Smith on March 13, 2023. Posted in blog, News.

As I begin to prepare for our first company offsite of the year, I find myself grateful. Gratefulness is a personal core value, but it is also a value our team shares. In fact, every Monday, we have a “gratefulness session” and share at least one thing for which we are grateful. Today I am grateful for you and our team.

The year 2022 was a challenging one for Longview and many of our clients. I’m not talking about how the market performed (although, that was a struggle for everyone), but about real life experiences, serious medical concerns, and loss of loved ones. Our team members experienced it as did several of you. Through it all, our team stood by each other, picking up additional job duties and offering support. You also showed support and poured into us as we navigated our way through the difficulties. So, this is a thank you letter.

Thank you for your continued support. You are the reason we exist as a firm. Your trust in us and our process along with your willingness to share our name with others has led to our continued growth. In fact, in 2022, a year that the market was down, we had our largest client growth year in our firm’s history.

Here we are, almost at the end of the first quarter of 2023 already! As we look ahead to the rest of the year, we have some exciting things planned to not only continue to strive for a high standard in our service and technical abilities, but also ways to better connect.

Again, thank you. Thank you for being a part of the Longview family. We appreciate you all more than we could ever put into words.

May we all find much for which to be grateful!

SECURE Act 2.0: An Overview

Written by Erik Buatte on January 3, 2023. Posted in blog, Charitable Planning, Education Planning, Estate Planning, Investment Planning, News, Philanthropic Planning, Retirement Planning, Tax Planning.

“Change is the only constant in life.” This phrase – attributed to Greek philosopher Heraclitus – is particularly relevant when it comes the recent changes to retirement savings in the United States. The Federal Government funding bill (which is over 4,000 pages long!) includes provisions from the prior proposed Setting Every Community Up for Retirement Enchantment (SECURE) Act 2.0 that will significantly change the way Americans save from retirement.

With that, let’s review some of those changes – specifically the “So What” that comes along with these changes. As we can expect in a law that is less than a week old, there are still a lot of unanswered questions on the HOW some of these changes will be implemented as well as the nuances as to WHEN each of these new laws are supposed to be put in effect (very few are scheduled to take effect right away in 2023).

To start, we will divide the changes based on who they are targeted at, based on life and career stage. Here is a quick summary of those main changes:

For those in retirement:

The Required Minimum Distribution (RMD) starting age will be increased to 73 starting in 2023 and 75 in 2033.
The penalty for missed RMDs will be decreased from 50% to 25% in 2023.
Employer sponsored retirement plans with a Roth account will no longer be subject to RMDs starting in 2024.
A one-time Qualified Charitable Distribution (QCD) will be allowed for Charitable Remainder Unitrusts (CRUTs) and Charitable Remainder Annuity Trusts (CRATs)starting in 2023.

For those nearing retirement:

The IRA catch-up contribution will be indexed to inflation starting in 2024.
A new “super catch-up” contribution will be available for those ages 60-63 in employer-sponsored retirement plans starting in 2025.
Catch-up contributions must be made to Roth accounts for those who made over $145,000 in the previous year starting in 2025.

For those in the early- to mid-career stages:

Automatic enrollment in new employer-sponsored plans will be mandatory starting in 2025.
Automatic rollovers between employer-sponsored plans will be allowed starting in 2025.
Employers will be able to offer Emergency Savings Accounts of up to $2,500 per year starting in 2024.
Employers will be able to make matching contributions to retirement plans to match student loan payments starting in 2024.

For education savers and beneficiaries:

A portion of overfunded 529 plans can be rolled over to Roth IRAs in the name of the 529 beneficiary starting in 2024.

—————

The details:

For those in retirement: More changes to Required Minimum Distributions

RMD Age Increased

Starting in 2023, Required Minimum Distributions (RMDs) are required in the year you turn 73 (previously 72 in 2022). In 2033, the starting age for RMDs will be increased to 75. This means that if you turn 72 on or after January 1, 2023 and 73 before January 1, 2033, your applicable age to start RMDs is 73. If you turn 75 on or after January 1, 2033, your applicable age to start is 75. This delay in RMDs allows for more years to control your income based on your needs and not mandated withdrawals, as well as increased years for proactive tax planning.

RMD Penalties Decreased

The new law also reduces the 50% penalty for missed RMDs to a less severe 25% penalty in the event that any portion of an RMD is missed in the year it is required to be distributed. It also reduces the penalty further to 10% in the event of prompt payment and acknowledgement of the missed RMD. This reduced penalty goes into effect in 2023.

RMDs for Employer Roth Accounts Waived

Starting in 2024, employer Roth accounts (such as 401(k)s, 402(b)s, and TSPs) will not be subject to RMDs – just like Roth IRAs. However, if you have funds in a Roth 401(k) and are 73 or over in 2023, you still have to meet your 2023 RMD in that account. This removes the urgency to roll over employer Roth 401K accounts into Roth IRAs as you near your RMD age and adds more flexibility in account ownership in retirement.

QCDs Expanded to CRUTs and CRATS

As of 2023, Qualified Charitable Distributions (QCDs) can be used to fund Charitable Remainder Unitrusts (CRUTs) and Charitable Remainder Annuity Trusts (CRATs) with a one-time gift of up to $50,000. Previously, QCDs to these trusts were not allowed. The new law does put two significant limitations to this opportunity however. First, stating that the QCD distribution must only be to a CRUT or CRAT that “is funded exclusively by qualified charitable distributions”. Secondly, all distributions to the trust beneficiaries will be classified as ordinary income, removing more tax preferred distributions of capital gains or qualified dividends like a “standard” CRAT or CRUT. Bottom line, there is an opportunity, but with a number of strings attached that may limit its usefulness to many.

For those nearing retirement: Opportunities to save more, but with complications.

IRA Catch-Up

In prior years, through 2023, the catch-up contribution for IRAs for those over 50 years old was held static at $1,000. A 55-year-old can contribute up to $7,000 ($6,000 base plus the $1,000 catch-up) in an IRA for tax year 2022. Starting in 2024 that catch-up limit will be indexed to inflation. This is an effort to increase that limit over time to better reflect its impact to savers getting ready for retirement. This won’t create a significant increase in the amount available year to year, but aligns it more so with other limitations that are indexed to inflation, allowing it to increase over time. For those looking to maximize this savings every year, you will need to verify the new annual value each year.

“Super Catch-Up”

SECURE 2.0 introduces a new category of catch-up contributions, the “Super Catch-Up”, for those ages 60-63 in 401(k)s, 403(b)s, and the Thrift Savings Plan. Current law allows in 2023 a catch-up contribution in these accounts of $7,500 (on top of the standard limit of $22,500 for a total of $30,000). Starting in 2025 those in that narrow age range are eligible to contribute a catch-up of $10,000 or 150% of the standard catch-up. Starting in 2026 this Super Catch-Up is adjusted for prior year’s inflation rate. In effect this creates three tiers of contribution limits in these employer sponsored plans based on ages:

Under 50: Base Contribution ($22,500 in 2023);
50-59 and 64+: Base plus Standard Contribution ($22,500+$7,500 in 2023);
60-63: Base plus the Super Catch-Up.

Bottom-line, as you near retirement you can potentially add even more to your employer sponsored retirement plans, but have to be vigilant of your specific applicable limits each year.

Catch-Ups Forced to Roth

With this one the new law gives us another significant complication. Starting in 2024 all catch-up contributions, that’s anything above the base contributions for that account type, must be done into a Roth account. Funds in a Roth account are a powerful thing for your financial future, but with a Roth contribution you have to pay the tax now. This takes away the opportunity to take pre-tax deductions on catch-up contributions for those in higher tax brackets. This only applies to those individuals with wages over $145,000 in the prior year. To help paint that picture a bit, let’s say you are 55 years old in 2024 and made $185,000 in wages in the prior year, 2023. In 2024 you can fund your 401(k) up to $30,000 (assuming no changes from 2022 limits for illustration purposes). But that $7,500 of catch-up contributions would have to be made to the Roth 401(k) and you would be on the hook for those income taxes in 2024. This is one of the key “revenue generators” included within the bill, and has some of the biggest questions on the HOW this would be put into practice. This provision makes the importance of a holistic planning approach, ensuring to balance your past, current, and future tax situation, current assets, and lifestyle plan even more important in making the decision to contribute catch-up funds to your employer plans.

For those in the early- to mid-career stages: More changes to your employer sponsored plans (401(k), 403(b), Thrift Savings Plan).

Automatic Enrollment

Starting in 2025, new employer plans (yes, just for any new plans) are required to automatically enroll employees starting at a minimum of 3% contributions. Many employers already have automatic enrollment with a gradual increase over a timeframe, but up until 2025 it is optional for employers. Automatic enrollment has been found to be a great tool in helping individuals start to save for retirement. If you are already diligent to ensure you get your employer match this is a no-change change; however, if you change employers make sure you read the plan documents carefully to determine its specific contribution increase path to avoid any surprises down the road.

Automatic Rollovers

The new law allows for 401(k) providers to automatically move your old 401(k) from a prior company to your new employer’s plan starting in 2025. This is an attempt to combat the “lost 401(k)” issues some individuals experience as they move from one company to another and potentially leave behind retirement savings. This is another item with many unknowns around HOW this would be realistically completed. Considering the questions on how this would be put in practice, it is still recommended that you carefully track prior accounts in employer sponsored plans and rollover to either a Rollover IRA or your new employer plan as appropriate for you.

Establishment of an Emergency Savings Account

To help employees save for emergencies, and reduce the reliance on hardship withdrawals from retirement accounts or taking on debt, the new law introduces an option for employers to offer an Emergency Savings Account starting in 2024. This would be savings in an after-tax basis, so no pre-tax deduction for these contributions. This would be limited to contributions of $2,500 per year and 4 withdrawals per year. If you find yourself struggling to meet your emergency savings needs, this may be a good tool for you to automate that deduction to the account and avoiding the need to reach into your 401(k) or short-term debt to fund those surprises.

Student Loan Match

This targets those individuals that are not contributing to retirement savings through work due to needing the cash flow to pay off student loans. Starting in 2024 companies can match student loan payments in retirement plans, like they would if the individual was contributing directly to the retirement plan up to the companies match. This would allow those in this position to start building some retirement savings and take advantage of compounding over a longer timeframe.

PLEASE NOTE:

Many of these provisions are optional, not mandatory, to the employer to include. If there is a provision that you are particularly interested in and want included in your company’s plan be proactive and reach out to your Human Resources point-of-contact and let them know.

For education savers and beneficiaries: There is more flexibility with savings in 529 Accounts.

529 Rollover Option

This provision has the potential to affect you across the life stages. 529s can be a great tool to save for education related expenses. Recently the 529 options were expanded to allow for expenses for K-12 and trade schools, in addition to college. However, in the event of overfunding a 529 there were limited options to get money out of the 529 without penalties. The new law, starting in 2024, allows extra funds in a 529 account to be rolled into a Roth IRA owned by the 529’s beneficiary. There are, of course, limits in place: you can only make contributions up to the individual IRA contribution limit ($6,000 in 2022), there’s a lifetime cap of $35,000, and the 529 must have been open for at least 15 years.

To illustrate this, let’s assume a grandparent established a large 529 when their grandchild was born. That grandchild graduates in 2025 with a bachelor’s degree and is done with schooling, and there is $15,000 still in the 529. One option that has been used widely is reassigning that 529 to another individual, like another grandchild. With the new law the grandparent could instead use the 529 funds to make a Roth IRA contribution on behalf of the grandchild in 2025, 2026, etc. until those funds run out. This new provision could provide for some new and unique opportunities for families both in the event of excess funds and in the development of a gifting strategy prior to education. However, this is another of the provisions that has a lot of questions in terms of the HOW we will see this put into practice going forward.

In Conclusion (for now):

This is by no means a comprehensive list of changes within the bill, but hopefully, it provides insight into the potential impacts from some of the major provisions of the new law and how they may affect our financial lives.

With change comes opportunities. By leveraging a financial plan that encompasses all parts of your financial life, these new “tools” can be thoughtfully put to use to reach your unique goals.

Fear Factor

Written by Jeff Jones on December 30, 2022. Posted in blog, Investment Planning, News.

Note: This published on December 30th, 2022 and may not be reflective of current market or investing issues.

When I say ‘fear factor,’ I’m not talking about that old American television game show from the early 2000s where contestants blindly stuck their hands in boxes of spiders *shiver*, among other ridiculous stunts, in an attempt to win money. I’m referring to good, old-fashioned fear, apprehension, alarm, and distress.

I know, this post is starting off on a strong, positive note. But stick with me. You know I’ll turn this into a story about financial planning or investment management, and you’re not wrong.

Market Watching

I have often told my clients and prospective clients that I’m not a “market watcher,” which is why I love having a dedicated investment advisor here at Longview. I have a confession to make: that’s not entirely true; however, my market watching is due to tracking the market for clients who are interested in putting set-aside monies to work in the market.

But when the fear factor sets in, it can make us do irrational things. You’ve probably heard the saying ‘buy low, sell high,’ but fear can flip that statement on its head. When we see a downturn and panic rises, we might wonder if we should just go to cash and wait it out. This can be detrimental to a financial plan. If we take the downside and miss the upturn, recovery becomes much more difficult.

CNN actually has a Fear & Greed Index that looks back over different periods of time to evaluate the levels of fear and greed in the marketplace. Keep in mind that this index is based on theory and consists of several indicators, so don’t take it at face value. (Link: https://www.cnn.com/markets/fear-and-greed)

Neil Diamond even has a song called “Fear of the Marketplace.” It’s a far cry from “Sweet Caroline.” I don’t recommend it, but if you insist (ads are not related to Longview):

Market Performance

It’s December 29th as I write this, and the one-year view of the S&P 500 Index isn’t looking very appealing. It’s a red line, and we’re not much above the low for the year. Take a look:

Pretty unsightly, right? This is where the fear factor can really set in. We see the downturn, and we worry. Or maybe we don’t. Maybe we realize that taking the “long view” is a better approach – one with less fear.

Now, let’s look at the same S&P 500 Index performance over a five-year period:

That’s a much more appealing result. Despite the 2022 performance, the market has climbed since the beginning of 2018. You were much better off remaining in the market during that time.

Neil, your thoughts

So, I invite you to join me as a self-proclaimed non-market watcher. I find myself harboring far less fear when I do. In the words of Neil Diamond:

Fear of the marketplace.
Just gotta forget the whole damn thing.

Thanks, Neil. I’ll do just that, and I hope you can, too.

You’re Invited to Longview’s Ribbon Cutting & Open House

Written by Jeff Jones on May 27, 2022. Posted in blog, News.

Drop in on Thursday, June 9th from 4-6pm for our ribbon cutting and open house. We’d love to show you our new place! Details are below:

Market Commentary

Written by Wes Johnson on May 24, 2022. Posted in blog, Investment Planning, News.

Note: This market review was published on May 24th, 2022 and may not be reflective of current market or investing issues.

“A genius is the man who can do the average thing when everyone else around him is losing his mind.”

~ Napoleon

The news around the economy and markets is getting pretty loud these days. I thought it would be appropriate to look at some facts and practical advice on how to make wise decisions in uncertain times. Let’s first analyze the current situation. Inflation is high. Labor is tight. GDP growth is slowing or has slowed. The Federal Reserve is tightening policy. The US stock market is in a correction (down 10%+) or bear market (down 20%+). The bond market, which is supposed to be safe, has been down more than 10% this year. Housing is slowing. These are leading to more and more headlines on the subject of bear markets and recessions. All of these headlines evoke feelings and emotions that can lead investors to make the wrong decisions at the wrong time. A friend of mine likes to say, “Don’t panic, but if you do, panic first.” The great Peter Lynch said this, “Corrections are unpredictable. By selling stocks to avoid pain, you can miss the next gain.” The thing to remember is that corrections and bear markets are natural and not to be feared.

Let’s look at some facts on bear markets. On average, the stock market during a bear market drops 36%, lasts less than 10 months, and happens about every four years.[1] In other words, they happen fairly frequently and are over relatively quickly. That begs the question, why don’t you exit positions and enter back when the coast is clear? To answer that, let’s look at up days during bear markets. Half of the highest gaining days for the stock market have happened during bear markets. Another 34% of the highest gaining days happened just as the bear market has ended when it’s unclear that it has ended. In other words, it’s extremely difficult to predict these things because there are massive up days, and it’s unclear when they end. One of my investing heroes, Cliff Asness of AQR, had a paper at his firm titled Sin A Little.[2] In it he describes that you can’t time the market, but if you have a diversified portfolio and see an opportunity to lean into a situation that makes sense to either underweight or overweight holdings, it can help. This is a practical way to help weather turbulent markets.

So, what are some other practical ways to make lemonade when the markets are handing out lemons?

Diversification. Having a portfolio that can benefit in different environments and circumstances can help calm fears in a hurry.

Tax-loss harvesting. If you have an investment portfolio that is in a taxable account, selling holdings at losses can help with taxes at the end of the year. Rotating those holdings into similar positions can keep your portfolio exposures the same but benefit from those realized losses. It also helps to not anchor to the losses if they are sold.

Accelerate investment. If the market gives you a discount and you can afford accelerating your retirement or investment savings, it can pay off down the road. When shopping for a car and you have been seeing prices going up year in and year out and all of a sudden you that same car you want is selling 20% lower, you buy it. The same thing happens in bear markets and corrections.

Rebalance. If you are holding a diversified portfolio, you are going to have holdings that are down and some that are up. It makes sense to sell the things that are up and buy the things that are down.

Dollar-Cost Average. Dollar-cost averaging is simply buying investments over time. Regular contributions to your investments allow you to take the opportunity to buy over time at potentially lower rates.

Limit Distributions. Taking distributions from your accounts as the market is decreasing means there is less available for the recovery. When possible, we recommend limited distributions during a bear market.

Stay the course. As indicated above, staying the course can lead to higher returns long- term. The highest gaining days usually occur in a bear market and sharp gains can happen quickly.

Remember, when all you see is negativity that there are some proactive steps that can be taken. Negative returns will come and that is a great time to position for success in the future. Capitalism exists to provide efficient use of resources, and when there become excesses in the system, recessions and bear markets come to correct those misuses. These things can be painful, but they can also lay the foundation for future growth.

[1] https://www.hartfordfunds.com/practice-management/client-conversations/bear-markets.html

[2] https://www.aqr.com/Insights/Research/White-Papers/Market-Timing-Sin-a-Little

Guest Post: WellStone Emergency Services Director of Development, Karen Petersen, CFRE

Written by Jeff Jones on January 28, 2022. Posted in blog, News, Non-Profit Spotlight.

It’s about time: “ER” for mental healthcare is finally coming to Madison County

You go to the emergency department for a broken bone or heart attack. But where can you and your loved ones go for emergencies involving mental health? For years, there were only two choices in Madison County: The ER or jail. Fortunately, a third, more effective and appropriate option is coming to the Rocket City.

WellStone, Inc., a 501(c)3 nonprofit organization, is building North Alabama’s first crisis intervention center. The 25,000 sq. ft. facility, which will be operated by WellStone Emergency Services, or WES, is scheduled to be completed in June. It’s on WellStone’s main campus on the Parkway near Torch’s Freedom Center. Experts say the 24/7 stand-alone psychiatric center will be a game-changer for mental healthcare in the Rocket City. The timing couldn’t be better.

After all, more people than ever are affected by mental illness and substance abuse. Fallout from COVID-related conditions have been detrimental to our collective mental health. It’s getting better, but statistics show that at one point, more than 40 percent of American adults reported symptoms consistent with anxiety or depression. Additionally, reports of substance abuse spiked, and overdose deaths surged to more than 100,000 in 2021.

Since the pandemic began, we, as a society, have also been hearing more about mental health crises. A mental health crisis is defined as “A situation in which a person’s behavior puts them at risk of hurting themselves or others and/or prevents them from being able to care for themselves or function effectively in the community.” A mental health crisis could involve several situations, including (but not limited to) suicidal ideation, psychotic episodes or substance abuse.

When WES opens its new facility, those in crisis will finally receive the compassionate mental healthcare they need with the dignity they deserve. When they leave, it won’t be the end, but the beginning, of their recovery journeys. Some will be referred to other programs and services within WellStone, such as therapy, medical regimens, group homes, support groups or Intensive Outpatient (IOP) treatment for alcohol or drug addiction, clinically referred to as substance use disorder (SUD). We also work with community partners, linking clients to other community agencies and organizations that can assist with sustained recovery plans.

WES won’t just change the level of care for clients in crisis. Currently operating in a limited capacity at a temporary location, WES is already making a difference for law enforcement. When police are called to a mental health crisis, they typically spend hours with that individual, admitting them to the hospital or booking them in jail. Thanks to its partnership with WellStone, officers can bring a person in crisis to WES and be back patrolling our street in about 15 minutes.

“If it is a mental health crisis, there should be a mental health response,” said Huntsville Police Chief Mark McMurray. “By building a relationship with WellStone and our other community partners, we have been able to decrease the number of repeat encounters with law enforcement for people experiencing a mental health crisis. This partnership has not only served to increase safety for these individuals and our officers but has diverted those in need of appropriate behavioral health services away from the criminal justice system.”

The diversion center will also alleviate the burden of ER staff. An estimated 8,000 people wind up at Huntsville Hospital every year due to mental health crises. Unless there is an accompanying physical emergency, mental healthcare clients will go to WES, not the ER.

This facility has been in the works for several years, after the Alabama Department of Mental Health announced the state had a significant gap in its continuum of care. Those in crisis were slipping through the cracks.

In October 2020, Governor Kay Ivey announced that WellStone would be one of three agencies to operate mental healthcare crisis centers in Alabama. The state awarded WellStone $3m for construction of the new facility. Madison City, Madison County and Huntsville are generously contributing as well. Even so, WellStone remains $5m short of the $10m costs associated with this enormous construction project.

That’s why WellStone is launching a capital campaign and inviting North Alabamians to invest in this initiative. Community members are invited to “Be the Rock,” and help “build a foundation of community, compassion and connection for those in mental health crisis.”

As we roll out this campaign and prepare to open WES’s new facility, we hope people will open their minds to what it means to be in a mental health crisis. Additionally, we hope they also open their hearts, extending kindness to those whose pain, though harder to recognize and even comprehend, is often just as excruciating. Sometimes even more so.

If you are interested in learning more about WES or WellStone’s other mental health programs and services, please visit our website. For information about our “Be the Rock” campaign, including ways to support, click here or contact Karen Petersen at karen.petersen@wellstone.com. You can also like stay updated by liking WellStone’s Facebook page.

Meet Nicole Gardner, Longview’s Newest Team Member

Written by Jeff Jones on November 23, 2021. Posted in blog, News.

We would like to take the opportunity to introduce you to our newest team member, Nicole Gardner. Nicole joined Longview in October.

As many of you are aware, Debbie is retiring at the end of the year. Debbie has played an integral role in the success of Longview since 2008. Over her time at Longview, she has worn multiple hats, serving as an administrative assistant, client service associate, office manager, and now, trainer to Nicole. We are so grateful for Debbie and will miss her dearly. Longview wouldn’t be where we are today without her. We wish her the best in her retirement.

We are looking forward to you all meeting Nicole. We are certain you will enjoy her outgoing personality and wonderful Aussie accent as much as we do!

Quarterly Market Commentary

Written by Wes Johnson on November 2, 2021. Posted in blog, Investment Planning.

Note: This market review was published on November 2nd, 2021 and may not be reflective of current market or investing issues.

The third quarter was an eventful one in the US, although the S&P 500 only ended up gaining 0.11%¹. Markets started the quarter strong, before giving back almost all of their gains during the month of September where they had a drawdown of nearly 4%¹. There was a lot going on that lead to the drawdown, but one of the biggest issues was the federal governments budget negotiations.

The federal government has a fiscal year that runs from October 1^st to September 30^th every year. This year Republicans and Democrats were clashing over the annual spending bill and passed the October 1 deadline to fund the government. While this is not the first time that this has happened and there has been a government shutdown, this time there was a real threat that the government was going to miss a payment on their debt, resulting in the United States government defaulting on what is considered to be one of the safest investments in the world.

In addition to fiscal spending issues, COVID and the Delta variant made a huge resurgence in the late summer with cases in the United States peaking around the first week of September and deaths peaking around two weeks later². While most of the country was able to avoid severe restrictions and lockdowns, they did come back in some areas which put pressure on economic growth.

The hot topic in the world of finance right now is inflation. From gas stations to grocery stores, costs are increasing at a faster pace than they have since the Great Recession over a decade ago. The Consumer Price Index rose at an annual rate of more than 5% in September³. While inflation has been increasing for most of the year, the Federal Reserve has continuously downplayed the effects that it will have and labeled it as “transitory.” However, they have now come to admit that it is persisting longer than they expected due to labor shortages and supply chain issues.

As we look toward the end of 2021, which we cannot believe is only two months away, there are plenty of things to keep our eye on concerning our investments. First, the federal government seems to be nearing a compromise on another large spending bill which is currently priced at around $1.75 trillion in addition to another $1 trillion infrastructure bill that has already been passed by the Senate, the spending bill will need to be passed before the end of the year to avoid another government shutdown and potential default. Next, inflation is likely to remain elevated into the near future as the labor shortage and supply chain issues show no sign of being corrected as we enter the holiday shopping season. Finally, the latest wave of COVID cases is in decline and vaccinations continue to rise, if these trends are to continue, they should be supportive of further economic growth.

References

¹https://www.cnbc.com/quotes/.SPX

²https://covid.cdc.gov/covid-data-tracker/#trends_dailydeaths_7daycasesper100k|new_death|seven_day_cum_new_cases_per_100k

³https://www.bls.gov/charts/consumer-price-index/consumer-price-index-by-category-line-chart.htm