Home

Zachary Sprung Joins 2020 Student of the Year Campaign

I’m very excited to share with you that my son, Zachary Sprung, is part of the 2020 Student of the Year campaign.  Over the next 5 weeks, he will be working to raise money and awareness for The Leukemia & Lymphoma Society (LLS) and their mission to cure blood cancers. 

He is honored to be a part of such an outstanding group of fellow students, but it is an even larger honor to be able to work for the patients, survivors and their families.

Zach's personal goal is to raise $15,000 between today, and March 11th.  It’s a lofty goal, but he is willing to work hard to reach it. He cannot do it alone, and he needs your help. 

You can donate via his personal fundraising page: https://events.lls.org/li/lisoy20/zsprung 

Not only is this campaign a great way to support LLS and their life-saving work, but it’s a great leadership opportunity for him. Students receive scholarships based on their fundraising and awareness efforts. I am so excited to be able to share how he is trying to make a difference in the community. 

Thank you for your generosity and support. Your donation truly makes a difference and with your help, we’re one step closer to a cure for blood cancers. 

P.S. Does your company have a matching gifts program that might be willing to match your donation? Be sure to fill out the matching form if they do.

81490556 10157517838651014 5644140794257342464 o
 
We appreciate any support you can provide to Zach and this great cause!

This article represents the opinion of Mitlin Financial Inc. It should not be construed as providing investment, legal and/or tax advice.

Three Main Contributors to The Student Debt Crisis

 CollegeDebtCrisisAs many of you know, I am knee-deep in the college planning process for my oldest who is a junior in high school and student debt has been a hot topic. The student debt issue in this country is real and a $1.5 Trillion Dollar one at that. This exceeds the outstanding debt for consumer car loans and credit cards too. So how are we here? Why are the future leaders of our country and economy racking up debt to such a large extent?

The way I see it, there are three parties at fault for this crisis and it needs to be addressed before it becomes a larger issue for the economy at large. In looking at this issue I see three main contributors, the schools, parents and students, and the government. Let’s address each one in further detail.

1) Schools have become one of the largest contributors to the crisis. They are higher learning institutions that have become marketing machines. They inundate potential students with information, enticements and many times inaccurate information regarding their institution to get you to attend and fork over the huge tuitions. Universities have also uncovered a way to keep you longer, the five-year program. It used to be college students would be on the five-year program if they could not find their way while attending, now the schools simply have designed programs to keep you longer.

What is the ROI for a student that spends the fifth year instead of entering the workforce after four? Is it that much higher to make it worth the time and money? I would argue that, unless you are entering a specific specialty that requires the fifth year, the return on that investment is very low.

 

2) Parents and students certainly are contributing to this crisis too. We all want the best for our kids, but does it make sense for us to put our families in financial strain and/or our children in debt. I have seen numerous instances where kids have attended Universities, that have caused this type of financial strife, just because they had a sports team they wanted to root for or because they wanted to go to warmer weather. I thought going to college was to get ready and prepare you for the real world and a career. Based upon that, shouldn’t we be evaluating schools on their ability to provide your students with the greatest return on investment for their chosen area of interest?

We, as parents, must educate our children on what the cost-benefit of going to school is and put guardrails on what can be spent. Each family is different, based upon their income level and savings, but there should be some parameters put into place. Encouraging our children to take loans, without educating them on the long-term effects on their financial situation, is the equivalent of putting them in a boat without a life vest. Not many seventeen or eighteen-year-olds comprehend the true cost of taking on $100,000 in loans for their education. It is our job to help them understand what it means.

 

3) I blame the government for this problem too. They are too quick to provide loans to our young people without having them understand what they are committing too. Loans are an important part of the education process and they should be available to those that need them and understand the ramifications. There has to be a way that there could be a requirement that these students receive some type of education showing them what the effects will be. Offering a student a loan to get their education and deferring their payments until they graduate sounds fantastic, even better to a young person. Many do not realize that these loans, although no payments are being made, are accumulating interest from day one and will be much larger when they begin payments. We must show them what the loan is going to cost them in the long run and how long it could take for them to potentially pay it back.

 

The student loan crisis is a complicated one but needs to be addressed. It needs to be attacked from several angles and not just one. As you embark on the college planning process please keep these issues in mind and think twice before you take on a great deal of debt for your family and your child. I would be happy to discuss your situation with you or anyone that you know. Just contact us, Mitlin Financial, at (844) 4-MITLIN x12 to schedule a time if you would like to discuss the college planning process and the effect it could have on your family’s financial situation.

Be sure to share this article with friends, family and business acquaintances who might be interested too. We look forward to helping you, and them, get on the right path and stay there.

This article represents the opinion of Mitlin Financial Inc. It should not be construed as providing investment, legal and/or tax advice.

Mitlin Financial Welcomes Jorrell Bland to the Team

 Bland Jorrell ProfessionalPhoto Web

Mitlin Financial, Inc. is pleased to announce that Jorrell R. Bland has joined us as the newest member of our team.
 
Jorrell comes to us with over four years of experience in the financial services industry with New York Life.  Jorrell will be responsible for servicing clients of the firm and making sure they are "WOW'd".  He is committed to providing our clients, and all those that interact with our firm, a high level of service.
 
Please join me in welcoming Jorrell to Mitlin Financial and feel free to contact him at (631) 952-4466 x13 or via email at This email address is being protected from spambots. You need JavaScript enabled to view it..  Jorrell looks forward to speaking with you and meeting you in the near future.

This article represents the opinion of Mitlin Financial Inc. It should not be construed as providing investment, legal and/or tax advice.

Zero Commissions, Does Not Mean “Free”

 

zero

 

Recently several brokerage firms, including our primary custodian TD Ameritrade, have announced they are moving to zero commissions on online trades involving equities, exchange-traded funds (ETF’s) and options. This move is a result of pressure from investment firms like Robinhood who have made this move in recent years.

At first glance, this seems like a win for the investor and it is to a degree. This will eliminate a nuisance fee of, around, $10 to place orders to buy and sell these securities. Let’s be real though, in some instances these little fees added up to a hundred million or more of revenue for some of these firms. Do we really believe that they are simply going to let go of this revenue without trying to recapture it somewhere else? I surely do not!

The brokerage firms are going to be hard-pressed to replace the lost revenue in other places. I believe this may lead them to recover the revenue through less transparent methods. When you were paying $6.99 a trade (or whatever your brokerage was charging) you knew the inherent cost of the trade or at least thought you did. In many instances, although you were paying $6.99 per trade the brokerage firms were deriving additional revenue from these trades in other places. The $6.99 was clear and transparent, while the other costs were not.

Zero commissions, I believe, will not mean zero cost to the client. Just as $6.99 did not necessarily mean that was the total cost. There are several ways these firms will be able to ascertain revenue, such as widening the bid/ask on securities, selling their order flow and requiring certain cash balances in client accounts.

The first two methods cited above, widening the bid/ask and selling order flow, are techniques used by the brokerages to add revenue through trading. These are methods used by the brokerage firms and custodians in order to increase their revenues generated based upon the sheer volume of orders that they are placing on an ongoing basis. The client is typically getting a fair price but it enables the firms to generate more revenue at the same time. In a perfect world, the client would pay nothing for the trade and potentially receive a better price for the transaction. As we know, nothing in life is free.

We also may see the brokerage firms start requiring clients to maintain a certain amount in cash balances to receive “free” trading. Cash balances have a tendency to be a huge source of revenue for firms. These balances are currently receiving a paltry amount of interest and the brokerages are able to lend out funds, based upon these balances, at much higher rates. The revenue generated to them is the difference between what they are paying the client and what they are receiving in interest. In many cases, this could be several percentage points of interest. Should firms require a certain amount of cash balances be maintained in an account for “free” trading, is it really free then? In my view you are simply underwriting your own trading by maintaining the balances they require with the revenue being generated.

The takeaway here should be, “free” is not free, there is typically a cost somewhere. It is important that you work with a fiduciary advisor that will review, share and discuss these potential issues with you and disclose those conflicts of interest too. Be sure to contact us, Mitlin Financial, at (844) 4-MITLIN x12 to schedule a time if you would like to discuss “free” trading further and how it might affect you and your portfolio.

Be sure to share this article with friends, family and business acquaintances who might be interested too. We look forward to helping you, and them, get on the right path and stay there.

 

This article represents the opinion of Mitlin Financial Inc. It should not be construed as providing investment, legal and/or tax advice.

Congress Set To Pass SECURE Act

 CapitalBuilding

The SECURE Act, Setting Every Community Up for Retirement Enhancement Act, has been in the news for many months now. Since the House passed this earlier in the summer there has not been much heard about it until recently. This piece of legislation has been attached to the spending bill that Congress is looking to pass before they break for the holiday. The House has already passed it and it is on to the Senate.

This is a complex act with many working parts. We will cover some of the highlights that will affect the largest majority of people.

We see one of the most sweeping changes in the way beneficiary IRA’s will be handled. The SECURE Act will eliminate the ability of the beneficiary (unless they are a spouse or fill another exception) to stretch the payments from the IRA over their lifetime, the well-known stretch IRA. Instead, beneficiaries will be forced to withdraw all the assets from the beneficiary IRA no later than 10 years after the account owner passes away. This will have significant impacts on the tax status, especially those in high brackets and their prime working years, of the beneficiary and could have other adverse consequences as a result too. This provision will have the potential for a negative impact over time.

The act does contain some provisions that will be helpful. Those who have IRA assets will not be required to take RMD’s (required minimum distributions) until the age of 72. This will only apply to those that have not attained age 70 ½ before the end of 2019. In addition, those who are working past the age of 70 ½ who currently cannot make IRA contributions will be able too.

The SECURE Act is being touted as the most sweeping piece of legislation in the retirement area since the passage of the Pension Protection Act of 2006. There are additional aspects of the act that will affect retirement plans which will potentially provide access to more people to save. In addition, the insurance industry has been a big proponent of this legislation because it will provide the ability for insurance products, specifically annuities, to be purchased inside of 401(k) plans. This is a big win for the insurance company, but I am not sure it is equally as beneficial for the general public looking to save.

The SECURE Act contains 29 new provisions and changes, far too many to cover in a blog post, but I believe we have covered the most important ones. It is going to be more important than ever in 2020 to make sure that you are working with a fiduciary advisor, who is working in your best interest, who understands how this act is going to affect you. There may be additional planning needed from an estate planning perspective if your current assets include a large retirement plan and/or IRA assets.

It looks highly likely that this legislation will pass later this week and you will want to make sure you know how this is going to affect you in 2020 and going forward. We will be addressing this with each of our clients in their upcoming meetings and suggest you make sure you are reviewing it too. Be sure to contact us, Mitlin Financial, at (844) 4-MITLIN x12 to schedule a time if you would like to discuss the SECURE Act and what effect it could have on your family’s financial situation.

Be sure to share this article with friends, family and business acquaintances who might be interested too. We look forward to helping you, and them, get on the right path and stay there. 

This article represents the opinion of Mitlin Financial Inc. It should not be construed as providing investment, legal and/or tax advice.

More Articles ...

@MitlinFinancial