Money Matters MALLARD Financial Partners INC

MALLARD Financial Partners INC

Message from the CEO, by Joseph L. Daigle II, CFEI

As a financial services firm, Mallard is deemed an essential service by Dela-

ware’s Governor and we have not been required to close our office. However,

since March 24th, Mallard’s staff has been working from home to minimize the

risk of spreading Covid-19. We felt it was the responsible path to take. We have

kept one staff person checking, and processing, the mail each day to ensure no

client communications are missed.

During the initial economic shock and uncertainty following the onset of the

pandemic and social distancing, Mallard applied for and received a loan through

the SBA’s Paycheck Protection Program (PPP). We used the loan to maintain

the hours and payroll of our entire office staff, consistent with the intent of the

program, so we expect this loan to be forgiven. I share this because at Mallard

we value honesty, integrity, and transparency. I consider it important to be clear

about the business decisions we’re making and share that Mallard is in a strong

financial position and able to serve our clients.

If you are not yet an ongoing Mallard client, now might be the time.

You might want a Financial Planner on your team, especially in these uncertain

times. Contact us to schedule your free, no obligation, 60 minute get-acquainted

meeting. We can hold a phone call or an online virtual meeting to suit your

needs. You’ll learn more about what Mallard does and we will learn more about

your needs. Only then can we work together to build your financial future.

Contact us at: info@mallardfinancial.com or 302-737-4546.

Can Mallard Help You?

Mallard Money Matters July 2020 Page 2

While the events of 2020 have presented many hurdles, they have also created some unique opportunities:

1. Mortgage rates have fallen to relative lows.

2. The RMD rules do not apply for 2020.

3. Converting assets to a Roth IRA are especially timely.

One major opportunity for homeowners is that home mortgage rates have fallen to new lows. How does 3% for a 30-year mortgage sound? How about 2½% for 15-years? How does a HELOC (home equity line of credit) under 2% seem? A few years ago they might have sounded outlandish, but they are recent realities here in 2020. For those who still carry a home mortgage from yesteryear’s interest rate environment, now may be a good time to think through the refinancing question. That said, more than just past rates vs. current rates needs to be considered. How long do you expect to keep your mortgage? What is the total cost of refinancing, including closing costs? How long until you recoup those costs?

The “cost” of obtaining a loan (or refinancing an existing one) is a big factor when deciding whether to apply. If you are interested, ask your lenders if they have any “special” loan offerings (e.g., a no-cost HELOC or a low-cost refinance). Using the mortgage refinance calculator on www.nerdwallet.com may help guide your decision.

Paying off your mortgage is another consideration. After evaluating your overall mortgage situation, you may want to decide to reduce your expenses by paying it off. Since the new tax law raised standard deduction amounts, many people are no longer able to deduct mortgage interest as an itemized deduction on their tax returns, so a mortgage is not as advantageous. Making this decision requires taking several things into consideration, such as where to get the funds to pay it off and predicting the tax consequences of such an action.

Now may be a good time to apply for a HELOC. Although the interest is no longer deductible (except when the proceeds are used for certain home improvements), these loans are often very handy for people who find them-selves wanting to buy a new house before they sell their current home (or want to buy a second home).

Another major opportunity impacts the retirement investing space. RMDs (required minimum distributions) do not have to be taken for 2020. This relief applies to all retirement plans and accounts (e.g., IRAs, 401(k)s, 403(b)s, etc.). It applies to lifetime distributions to owners and death distributions to beneficiaries. For those who don’t need to pull from their retirement accounts to meet living expenses, this creates an opportunity to lower taxable income. Because these amounts are not RMDs in 2020, the amounts are eligible for rollover or conversion to a Roth IRA, using the standard rules.

Elsewhere in the retirement space, converting funds from a traditional, SEP, or SIMPLE IRA to a Roth IRA can offer benefits – as part of a sound, coordinated financial plan. Reducing overall taxation means more funds are available for discretionary spending. This year offers a prime window for Roth conversions for a few rea-sons. Since RMDs are eliminated for 2020, many taxpayers will have additional headroom in their current margin-al tax bracket to convert what would have been their RMD, and maybe more! Income smoothing is beneficial for income taxes in general and, specifically for those who are 65 or older, avoiding Medicare premium surcharges.

Converting assets to a Roth IRA offers a greater benefit if share prices are at a relative low. (More shares can be converted for the same amount of taxable income.) If share prices take another dip before the end of the year, that might be an excellent time to complete this transaction.

In addition to these opportunities, for those who have been impacted by COVID-19, many restrictions have been lessened for 2020, such as the ability to withdraw up to $100,000 penalty-free (but not tax-free) from an IRA or 401(k) plan for those under age 59 1/2.

We hope that next year will bring new opportunities … and less Covid.

Opportunities in 2020, by Ed Mink CFP®, Financial Advisor

Mallard Money Matters July 2020 Page 3

Mallard has 19 full and part-time staff members. We were able to keep everyone employed during our physi-

cal-office shut down, but we spent our “stay-at-home” weeks in a wide variety of ways. Here’s how some of

the staff kept busy when we were not working:

Bought a new house (and painted the interior) and made blueberry bread

Rediscovered a love of sewing, while making (and donating) over 500 face masks

Organized basement and unpacked the last box from last

year’s move

Bushwacked the back fence and took up crumb quilting

Walked twice daily and lost 10 pounds

Took down over 8 trees from the yard

Adopted two kittens

Finished a college degree

Read over 20 novels

Bought a new car

Caught up on sleep

Grew a mustache

Thankfully, none of us have been sick with Covid-19. We hope your family, and ours, all continue to stay

well. We’re all in this together .

Please join us in congratulating Jordan Jones on becoming a full-time

member of our team! He graduated from the University of Delaware in

June with a Bachelor of Arts in Psychology. Jordan started with Mallard

in 2013 as a student intern while in high school and has proven himself to

be a valuable member of the team over his seven years with us. As a Senior

Operations Specialist in our Investment Operations Department, Jordan

will continue to work on the production of client reports and trades, along

with maintaining and improving Mallard's online presence. He is looking

forward to having a productive future at Mallard and becoming a long term

member of the Mallard team as we continue to grow.

Mallard at Home

Congratulations and Introduction to Jordan Jones, Senior Operations Specialist

750 Barksdale Road, Suite 3

Newark, DE 19711-3245

Working together, building your financial security

We are currently accepting new clients. If you know someone who is looking for financial advice, please think of us!

We offer a free 60 minute meeting — as a

nice way to get to know each other without

making a firm commitment.

We work with individuals, small businesses,

family trusts, estates, and nonprofits. Our

clients’ portfolios range from $20,000 to

$10 million. We can offer financial advice

on specific topics, such as retirement, tax

planning, education planning, estate planning,

financial planning, etc. We also offer full-

service Fee-Only investment management.

Your questions and comments

are always welcome.

Contact us at 302-737-4546 or

info@mallardfinancial.com

At Mallard Financial Partners,

we are fiduciaries.

That means we always put

our clients’ interests first.

Our business is about relationships,

not transactions.

Alan Coffey, our Cybersecurity Officer, has

joined the Board of Directors of Tri-State Bird

Rescue & Research.

Their mission is to provide professional,

compassionate rehabilitation to native injured

and orphaned wild birds and contaminated

wildlife, and to promote their stewardship

through education and humane research.

See www.tristatebird.org to learn more.

Referrals Welcome ! Fee-Only Advisors

www.mallardfinancial.com

Mallard in the Community