The Bipartisan Infrastructure Plan
The bipartisan infrastructure plan was signed into law this week with a big yawn from markets. It is easy to forget that traditional thinking is: markets are always discounting in advance and expecting occurrences that might have an impact. Records for new highs in stock market averages were anticipating financial intervention in the form of infrastructure. The implementation of the infrastructure legislation will take time and will have little impact on the economy in the short term. Still, market averages hover near records.
Next on President Biden’s agenda is the passage of the build-back better legislation focused on soft infrastructure (internet, childcare, pre-k, reimbursement to family caregivers, family leave), which the House hopes to pass this week. Timelines have been moved repeatedly and we are paying attention.
Climate change impacts
Climate change is impacting the entire world. It always seemed so far off until this year. The evidence of global warming and climate change are evident all over the United States and the world. The COP26 United Nations Climate Change conference attempted to bring nations together to commit to confront and get ahead of climate change. The divisions in the world as well in our country were indicated by the action and statements taken. One big divide is between developed countries and developing countries. Developed countries have the resources and economies to develop alternative energy sources as well as take measures to encourage energy conservation and pollution remediation. Not so much for developing countries. Combating climate change is expensive. Developing economies are suffering from the pandemic and they have less incentive to invest and encourage climate change remediation because it is expensive. Though climate change does not recognize country borders or state borders.
The political problem is serious, especially in the United States. Imagine if President Biden or his climate change emissary John Kerry proposed that the United States help fund climate change remediation efforts in developing countries. One reason the United States has not been aggressive with legislation addressing climate change is due to the cost and the entrenched special interests that profit from the current energy policy. Acting beyond a single country's self-interest will be required to make meaningful progress on the resulting threats to well-being.
Not only are there divisions across political parties addressing climate change, but there is also a generational divide with young Americans much more concerned about climate change than their parents. Take a look at this survey from May 2021 by the Pew Trust: https://www.pewresearch.org/fact-tank/2021/05/26/key-findings-how-americans-attitudes-about-climate-change-differ-by-generation-party-and-other-factors/.
On another note, for those looking for an escape, be sure to check out Disney’s Star Wars Galactic Cruiser two-day immersion. It looks like a fantastic domestic travel outlet to fulfill some of our greatest fantasies: https://disneyworld.disney.go.com/star-wars-galactic-starcruiser/overview/
Additional Resources: Retirement Plan and IRA Required Minimum Distributions FAQs
For 2021, Required Minimum Distributions, or RMDs, will be required from all eligible accounts before 12/31/2021. Last year, 2020, the CARES Act provided a one-year suspension on Required Minimum Distributions. That suspension ended on 12/31/2020.
To determine if you may be required to make a Required Minimum Distribution in 2021, consider the following two questions:
- Yes/No: Are you age 72? OR were you age 70.5 years old as of 1/1/2020? OR Regardless of age, do you own an inherited or beneficiary retirement account of any kind?
- Yes/No: Do you own any of the following employer-sponsored retirement plans? Profit-sharing plans, 401(k) plans (including Roth 401(k) plans), 403(b) plans, and 457(b) plans. Do you own any traditional IRAs and IRA-based plans such as SEPs, SARSEPs, and SIMPLE IRAs? (Note: RMD Rules do not apply to Roth IRAs while the owner is alive).
If you answered "Yes" to both of the above questions, you may be required to make a distribution from each eligible account before 12/31/2021.
For SAS managed accounts eligible for a 2021 RMD, please contact the SAS Advisor Team with the following information before 10/31/2021:
- If you would like your RMD to be completed with the same instructions as 2019
- The percentage to be withheld for federal *and* state taxes, or mark none
- The account to receive the RMD funds into either another owned Individual, Joint, or Trust account managed by SAS, or an external linked account not managed by SAS
- If banking instructions are not on file, please complete, sign and send back the following form to the SAS Advisor Team along with your responses: https://veoone.tdainstitutional.com/teamsite_vdh/resources/documents/downloadforms/TDAI9341.pdf
For non-SAS managed accounts eligible for a 2021 RMD, contact that account's advisor, custodian, or plan administration to complete the 2021 RMD before 12/31/2021.
IRS RMD Reference Link per the date of this blog 10/15/2021: https://www.irs.gov/retirement-plans/retirement-plans-faqs-regarding-required-minimum-distributions
This website is informational only and does not constitute investment advice or a solicitation. Investments and investment strategies recommended in this blog may not be suitable for all investors. SAS Financial Advisors, LLC and its members may hold positions in the securities mentioned within this newsletter.