Banking Leaders: Are They BORN or MADE?

Bob DiCosola, EVP, Human Resource/Training & Development/Risk Management

Robert DiCosola

As an adjunct professor at a local college, I always ask that question as part of the
curriculum for the HR management and business classes I teach. The answer is almost always the same: About 50 percent of the class feels leaders are born, and the other 50 percent believes leaders are made.

That split is actually quite predictable. Experts in this field note that about 15 percent of executives (the top of the bell curve) are born leaders who start out strong and get better over time. Another 15 percent (the bottom of the bell curve) are executives who never want to be leaders or who are never going to be good leaders. The middle of the bell curve (everyone else, or 70 percent of executives) is where the potential to make leaders lies!

A perfect case study for this blog involves my two sons, Joe and Rob. Joe, 22 years old and a recent Audio Engineer grad, is humble, sympathetic, patient, empathetic, a great listener, and a young man of high integrity. Rob, 17 years old and a senior in high school (and drum major in the Batavia marching band this year), is a great communicator, consensus-builder, coach, motivator, problem identifier and problem solver. All of these are outstanding traits for a leader of people. But Joe would rather have a root canal than lead, while Rob naturally leads his peer group like the Pied Piper of Batavia!

 So Rob is at the top of the bell curve and Joe is at the bottom. What does that mean for the 70 percent?

For those executives who have aspirations to manage and lead, a good place for them to start is to train a laser focus on their company’s core values and. Then they can work to hone the leadership competencies necessary to embodying those values.

At Old Second, our core values drive the competencies we require for potential leaders. They are:

  • Solve It
  • Own It
  • Collaborate
  • Innovate
  • Keep Growing
  • Walk the Talk

The corresponding leadership competencies are to:

  • Support strategic growth goals by being a visionary, strategic planner, as well as a sales/service coach and motivator; a consensus and unity builder; and a manager who understands profitability and is willing to serve as a change agent when needed.
  • Support the image of a trusted community banker by leading through example and acting with integrity, trust, and credibility, while being inclusiveness and demonstrating strong community ties.
  • Support ongoing development vs. stagnation through the continuous development of yourself and staff; offering operational and technical expertise; and serving as an example of a well-rounded banker.

As a senior management team, we strongly believe that respect and leadership are mutually inclusive. We further believe that managers who serve as role models of ethics and integrity and who gain respect through credibility, rather than through intimidation, make the best ambassadors for a community bank.

In discussing career growth with our employees, we always make sure that they understand our overall philosophy:

“Career development is the responsibility of the incumbent; management’s role is to provide the tools and opportunities to make it happen.”

Ultimately, Where Your Career Leads Is Up to You

The question is not whether you are a naturally born leader or not. The question you need to ask yourself is: o you have the drive, focus and perseverance to become one?

It’s of the utmost importance to create your own personal blueprint. Identify and address opportunities for improvement as they arise, while maximizing your strengths. Then, partner with your boss to make what comes next happen!

New British PM: Wealth Economic Update July 18, 2016

U.S. and World News

  • Theresa May, British Prime Minister

    Theresa May, British Prime Minister*

    Just three weeks after the U.K. voted in favor of leaving the European Union, Theresa May took over from David Cameron to become the 54th British Prime Minister. Financial markets appeared to approve of the selection although many analysts have said the implications for the U.K. economy could be much bigger due to uncertainty about her policies. May has wasted no time readying her Brexit team as she has appointed a Chancellor, foreign secretary, a Brexit “Tsar” and a trade negotiator.

  • Staying in the U.K., the Bank of England surprised the market by choosing to hold off on any easing action this week. It was believed that BOE Governor Mark Carney would cut rates 25 basis points or increase its bond buying program in the wake of the Brexit vote in order to ward off a possible recession.

Markets

  • This week the S&P 500 was up 1.51% for the week and closed at 2,162. The Dow Jones gained 2.04% and closed at 18,517. So far in 2016, the S&P is up 6.94% and the Dow is up 7.68%.
  • The 5 year and 10 year U.S. Treasury Notes are now yielding 1.11% and 1.56%, respectively.
  • The spot price of WTI Crude Oil gained 1.17% this week to close at $45.94 per barrel. WTI Crude is up 9.69% in 2016.
  • The spot price of Gold lost 2.21% this week, closing at $1,336.15 per ounce. Year to date, gold prices are up 25.92%.

Economic Data

  • Initial jobless claims came in at 254,000 which was unchanged from last week’s reading. The Labor Department noted no special factors in the data. The four week moving average for claims moved down to 259,000.
  • The headline Consumer Price Index (measure of inflation) rose 0.2% in June, below estimates of 0.3%. This was boosted by a 1.3% increase in energy prices, although food prices decline -0.1%. Over the last 12 months, headline CPI has risen 1.0%.
    • The Core CPI (excludes food and energy) rose 0.2%, in line with expectations. Rent inflation remained firm, rising 0.3% in the month. Over the last year, core prices have risen 2.3%.
  • Retail sales increased by 0.6% in June, soundly beating estimates of 0.1%. Sales were boosted in part by higher gasoline sales as fuel prices rose.

Fact of the Week

  • As of 6/30/2016, there was $11.7 trillion of sovereign debt that carries a negative interest rate (ie. investors loaned governments money with the guarantee that they would be paid back less if they held the bond to maturity). This represents over 30% of the world’s sovereign debt. Countries issuing negative yield debt include Japan, Germany, Sweden, Denmark and Switzerland. (Source: Fitch Ratings)

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 rgartelmann@oldsecond.com
Jean Van Keppel CFA® – (630) 906-5489 jvankeppel@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Joel Binder, SVP – (630) 844-6767 jbinder@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz, VP – (630) 906-5467 ejgorenz@oldsecond.com

Visit Old Second Wealth Management

*Image of Theresa May, Photo credit:UK Home Office, via Wikimedia Commons. License: Creative Commons Attribution 2.0 Generic license.. (See, https://commons.wikimedia.org/wiki/File:Theresa_May_2015_(cropped).jpg).

Non-deposit investment products are not insured by the FDIC; not a deposit of, or guaranteed by, the bank; may lose value.

 

Brexit aftermath: Wealth Economic Update July 5, 2016

U.S. and World News

  • pont_fawr_bridge_Wales_84636501_340The U.K. now faces the challenge created by its vote to leave the European Union and Chancellor George Osborne cautioned it would not be “plain sailing” in the days and weeks ahead. In the fallout from the shocking vote, there have been rumblings of a “re-do” vote or a renewed independence vote in Scotland, but neither is likely to gain too much traction. The process for the U.K. to leave is will officially begin when Parliament invokes Article 50, the timing of which has yet to be determined. Candidates for the Prime Minister post that David Cameron resigned from are beginning to emerge, though prominent Brexit figurehead and former London Mayor Boris Johnson has dropped out of the running.
  • Puerto Rico today defaulted on $800 million of debt payments it had constitutionally guaranteed to make to general obligation bond holders. These bond holders were supposed to receive priority before the Puerto Rican government paid out anything to state employees like police and teachers, however Governor Garcia Padilla ruled to continue running essential services on the island. This marks the first time that a U.S. state or territory has failed to pay general obligation bonds since the Great Depression. In response, Washington has pushed through a law signed by President Obama that would create a federal oversight board to oversee the restructuring of Puerto Rico’s over $70 billion of additional debt. The plan involves 1 out of every 3 dollars the island earns in revenue being used to pay off creditors.

Markets

  • After falling dramatically again on Monday, markets roared back the remainder of the week and regained most if not all of the post-Brexit losses. The S&P 500 was up 3.27% for the week and closed at 2,103. The Dow Jones gained 3.18% and closed at 17,949. So far in 2016, the S&P is up 4.00% and the Dow is up 4.37%.
  • Interest rates moved lower again this week despite the rally in the equity markets. The 5 year and 10 year U.S. Treasury Notes are now yielding 1.00% and 1.44%, respectively.
  • The spot price of WTI Crude Oil gained 3.48% this week to close at $49.30 per barrel. WTI Crude is up 17.71% in 2016.
  • The spot price of Gold gained 1.95% this week, closing at $1,341.35 per ounce. Year to date, gold prices are up 26.41%.

Economic Data

  • Initial jobless claims came in at 268,000 which was an increase from last week’s reading of 259,000. The Labor Department noted no special factors in the data. The four week moving average for claims moved down to 266,750.
  • The Case-Shiller home price index rose 0.5% in April, slightly missing expectations of 0.6%. Prices increased in 16 of the 20 cities represented in the index. Over the last 12 months, home prices as measured by the index have risen 5.4%.
  • The headline PCE Index (measure of inflation) rose by 0.2% in May, in line with consensus expectations. The increase was in part due to a 1.4% rise in energy goods and services prices. Over the last 12 months, headline PCE has increased 0.9%.
  • The Core PCE Index (excludes food and energy, preferred measure of inflation by the Federal Reserve) also increased 0.2% in May and was in line with expectations. Over the last 12 month, Core PCE has risen 1.6%, still well short of the Fed’s 2% inflation target.

Fact of the Week

  • According to the Social Security Trustees 2016 report, the trust fund backing the payment of Social Security benefits would be zero in 2035. A zero trust fund does not mean that Social Security payments would also go to zero, but rather would drop to 77% of their originally promised level (or a 23% cut to benefits). In the 2009 report, the projection had been that that the trust fund would hit zero in 2042.

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 rgartelmann@oldsecond.com
Jean Van Keppel CFA® – (630) 906-5489 jvankeppel@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Joel Binder, SVP – (630) 844-6767 jbinder@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz, VP – (630) 906-5467 ejgorenz@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC; not a deposit of, or guaranteed by, the bank; may lose value.

 

What May Surprise You About Treasury Management at Old Second Bank

Juwana Zanayed, First Vice President/Director—Treasury Management

Juwana ZanayedIn today’s world, access to treasury management tools is beneficial to companies of all sizes. But, how you gain access to those tools, their level of sophistication and the support you receive once you sign up for them can vary greatly. At Old Second, we offer all the same big bank products, on a local level and with personal hands-on service.

At their most basic, treasury management products and services help your business in at least one of three ways:

  1. Increase cash flow through remote deposit or lockbox services
  2. Tailor treasury management services to reduce accounts receivables
  3. Streamline operations through improved efficiencies

As technological innovations have enabled more banks to offer these products to companies of all sizes, there has been a tendency for some of the larger banks to package these services into off-the-shelf solutions. There are some efficiencies to be gained from doing this—at least from a bank’s perspective. But, taking a one-size-fits-all approach to bringing treasury management products to mid- to small-sized companies isn’t always a more efficient option for each client.

For this reason, we customize the suite of services we offer to your firm’s needs and then scale those services to the size of your company, not the other way around. Taking a right-sized approach enables us to not only give more clients access to the latest innovations in treasury management as soon as they are available, it also ensures you only pay for the services that are right for you.

One-Stop Shop Thanks to a Team Approach

Each relationship manager has an in-depth understanding of and can suggest best practices in treasury management. This allows us to look at the customer relationship as a whole, drawing in experts from across different service areas of the bank as needed.

As a result of this approach, each client is assigned a dedicated team of experts—including a lender, treasury advisor and a wealth manager. Regardless of whom you reach out to on the team, each knows the history of your relationship and will take a hands-on approach to answering your questions and resolving any issues that may arise.

What You Need Today

In addition to treasury management and credit tools, including our BusinessManager® [DIRECT LINK to previous blog] product, we find what businesses are most in need of today is confidence that when they are transacting business online it’s secure.

Our commercial online banking platform allows you to manage your accounts twenty-four hours a day with secure access from any computer with Internet access.

For this reason, we provide our clients with access to multi-layered protection in a variety of ways. We use Trusteer Rapport, a security software, to protect online banking communication from being stolen by detecting malicious browser tampering. It can also remove existing financial malware from employee machines and prevent future infections.

Security Manager, is another software feature. It offers password authentication by generating single-use, text passcodes. Old Second also uses multi-layered security and encryption to keep bank and account information secure.

In addition, we offer two fraud prevention tools:

  • Positive Pay protects against fraud by validating each item on each check to ensure only authorized checks are cleared through your accounts.
  • ACH Fraud Protection blocks and filters information to protect against electronic fraud.

For more information our treasury management services click here. To determine which are appropriate for your firm—contact a commercial representative at 877-866-0202. We can’t wait to talk to you about what we can do for you today.

 

UK Vote: Wealth Economic Update June 27, 2016

U.S. and World News

  • london_big-ben_49186880_340The United Kingdom has voted to Leave the European Union in the historic Brexit vote held on Thursday. For more information on this event, please see the special Brexit update here.
  • Acting Brazilian President Michel Temer has authorized a payment of $850 million from the federal government to the state of Rio de Janeiro, which is struggling with a fiscal crisis less than two months before the Olympic Games are slated to begin. This is in addition to fears about the Zika virus and other major public health concerns leading up to the Olympics. Rio declared a state of financial emergency last week as a result of deteriorating finances, which have forced deep cuts to services like education, healthcare and policing.
  • Just a week before $2 billion in bond payments come due, Puerto Rico’s governor Alejandro Garcia Padilla reiterated that the island will default on its general obligations even if services are cut off. Padilla is currently in Washington lobbying for Congressional approval of a bill that would establish the framework for Puerto Rico to restructure its $70 billion in debt.

Markets

  • Equity markets rallied early in the week before dropping dramatically after the results of the Brexit Referendum. The S&P 500 was down -1.62% for the week and closed at 2037. The Dow Jones dropped 1.55% and closed at 17,400. So far in 2016, the S&P is up 0.74% and the Dow is up 1.18%.
  • Interest rates moved lower again this week following the Brexit vote. The 5 year and 10 year U.S. Treasury Notes are now yielding 1.07% and 1.56%, respectively.
  • The spot price of WTI Crude Oil lost 2.04% this week to close at $47.57 per barrel. WTI Crude is up 13.59% in 2016.
  • The spot price of Gold gained 1.32% this week, closing at $1,315.75 per ounce. Year to date, gold prices are up 24.00%.

Economic Data

  • Initial jobless claims came in at 259,000 which was a decrease from last week’s reading of 277,000. The Labor Department noted no special factors in the data. The four week moving average for claims moved down to 267,000.
  • Existing home sales increased by 1.8% in May, which was in line with consensus and reached a new post-crisis high. Single family home sales rose 1.9% in the month, while multi-family sales increased 1.6%. By region, existing home sales rose in the Northeast (+4.1%), South (+4.6%) and West (+5.4%), but fell in the Midwest (-6.5%).

Fact of the Week

  • During the 25 years from 1991 to 2015, the average interest rate on a 10 year US Treasury note was 4.7%. As of close on Friday June 24th, the 10 year US Treasury note had a yield of 1.56%. (Source: Treasury Department)

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 rgartelmann@oldsecond.com
Jean Van Keppel CFA® – (630) 906-5489 jvankeppel@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Joel Binder, SVP – (630) 844-6767 jbinder@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz, VP – (630) 906-5467 ejgorenz@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC; not a deposit of, or guaranteed by, the bank; may lose value.

 

Brexit: Special Wealth Management Economic Update June 24, 2016

brexit_graphThe United Kingdom has spoken and its decision is for the nation to Leave the European Union. With all of the votes counted in the Brexit referendum, ‘Leave’ was victorious over ‘Remain’ by a margin of 52% to 48%. The result was a surprise to book makers and financial markets, both of which had heavily priced in a status quo result. Equity markets are sharply negative this morning, particularly overseas, and currency markets are quite volatile as they attempt to digest the surprising outcome.

UK Voters have had issues with the trade and particularly the immigration policies that had been imposed by the European Union for quite some time. The populistic belief that they had ‘lost their country’ to immigrants was the overriding reason for the ‘Leave’ vote. In response, Prime Minister David Cameron announced that he would resign and a replacement would be selected by October.

So what now? It should be noted that this will not be a fast process for the U.K. to leave. There is a two year negotiation period in order to establish new trade deals with the remaining EU members, all of which require parliamentary approval. The vote may also lead to other independence votes by other disgruntled EU members down the line, though EU officials will try to suppress these movements by making the terms of the UK’s exit as unattractive as possible. The longer term economic impact on the UK and Europe in general is up for debate, with many believing that all parties will be better off for the split, however short term volatility will likely continue as the details are worked out.

We at Old Second Wealth Management focus on long term investing, and market volatility such as this often presents opportunity to invest at depressed prices. If you have any questions or concerns, please do not hesitate to reach out to your Old Second Relationship Manager or Investment Officer.

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 rgartelmann@oldsecond.com
Jean Van Keppel CFA® – (630) 906-5489 jvankeppel@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Joel Binder, SVP – (630) 844-6767 jbinder@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz, VP – (630) 906-5467 ejgorenz@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC; not a deposit of, or guaranteed by, the bank; may lose value.

 

How to Navigate the Wealth Management Milestones in Your Life

Jacqueline Runnberg, CFP®

Jacqueline Runnberg, CFP®Everyone travels a different path through their financial life. But like any well-traveled road, there are milestones along the way. Here are the common life events you are likely to pass through—along with a few roadblocks and detours—and a checklist of what you should be considering as you reach each one.

First Job

  • Understand employee benefits and employer-sponsored (especially tax-advantaged) savings opportunities for health care expenses, retirement and student loan repayment
  • Create a will and set up powers of attorney

Career Changes

  • Review the impact a change will have on your insurance coverage
  • Rollover your retirement account to keep savings on track and tax deferred

How to Navigate the Wealth Management Milestones in Your LifeRelationship Commitments

  • Talk about money with your life partner—different attitudes can be reconciled but not if they are unknown to one another
  • Know each other’s debt load and credit scores
  • Determine how your assets and income will be pooled together, saved and spent
  • Decide the best way to obtain health insurance coverage
  • Review your named beneficiaries on your employee benefits and in your will and power-of-attorney documents

Home Ownership

  • Buy what you need, not the maximum you can afford—it’s likely going to be your biggest asset

Side Trips
These events can require that you immediately revisit your portfolio allocation, named beneficiaries, and state and local laws affecting personal property, liability and estate settlement:
➢ Moving to a new state
➢ Starting a business
➢ Receiving an inheritance

Children

  • Review your budget for different spending needs
  • Initiate saving for future expenses
  • Revisit your will or trust documents and be sure to name a guardian
  • Start saving for college

Detours
To avoid unintended consequences, update documents that name beneficiaries and those for insurance coverage with these events:
➢ Divorce
➢ Unemployment

Retirement Planning

  • Determine what retirement means to you
  • Periodically reassess and gauge your progress
  • Plan for healthcare expenses
  • Understand your options and benefits under Social Security

Estate Planning

  • Consider that having more assets require more tax planning to ensure efficiency
  • Take into account beneficiary considerations
  • Preserve wealth as it grows and the process becomes more complex
  • Plan for your legacy

Roadblocks
Be prepared to reroute for:
➢ Illness or disability
➢ Changes in laws

Retirement

  • Test income plan before fully retiring
  • Determine the best withdrawal strategy for your circumstances

We’ve helped many generations of financial travelers plan for their journey and for any side trips, detours or roadblocks they might encounter along the way. Give us a call to meet with a wealth management representative today. We’ll help you determine the best route for realizing your financial goals.

Non-deposit investment products are not insured by the FDIC; not a deposit of, or guaranteed by, the bank; may lose value.

Wealth Management Economic Update June 20, 2016

U.S. and World News

  • brexit_93801255_340Britain faces a critical vote on June 23rd to determine whether or not the nation will remain in the European Union. Momentum for the ‘Leave’ camp has been building in recent weeks which has added to volatility in the financial and currency markets. Adding to matters, a prominent member of the British Parliament and strong supporter a ‘Remain’, Jo Cox, was murdered this week by a pro-Brexit individual. Many analysts believe this act may sway voters more towards a ‘Remain’ choice.
  • The Federal Reserve chose to leave interest rates where they were during their policy meeting this week. It was a unanimous decision with no dissents. Referencing the weak May employment report, the Committee noted that the “pace of improvement in the labor market has slowed while growth in economic activity appears to have picked up.” The Committee members are starting to change their expectations to better match the market as now six of its officials are now projecting only one rate hike in 2016.

Markets

  • Equity markets were lower this week. The S&P 500 was down -1.12% for the week and closed at 2071. The Dow Jones dropped 1.00% and closed at 17,675. So far in 2016, the S&P is up 2.38% and the Dow is up 2.76%.
  • Interest rates moved lower again this week. The 5 year and 10 year U.S. Treasury Notes are now yielding 1.11% and 1.61%, respectively.
  • The spot price of WTI Crude Oil shed 1.92% this week to close at $48.13 per barrel. WTI Crude is up 16.45% in 2016.
  • The spot price of Gold gained 1.92% this week, closing at $1,298.65 per ounce. Year to date, gold prices are up 22.39%.

Economic Data

  • Initial jobless claims came in at 277,000 which was an increase from last week’s reading of 264,000. The Labor Department noted no special factors in the data. The four week moving average for claims moved down to 269,000.
  • The headline Consumer Price Index (measure of inflation) increased by 0.2% in May, boosted by higher energy prices (+1.2%). Over the last 12 months, CPI has risen a paltry 1.0%, mostly reflecting the prior decrease in energy prices.
  • Core CPI (excludes food and energy prices) also rose 0.2% in May. This brings the one year increase in core prices to 2.2%.
  • Retail sales increased by 0.5% in May, partially benefitting from higher gas station sales. Motor vehicle sales also gained 0.5% during the month.

Fact of the Week

  • The number of internet capable electronic devices (ie. laptops, smart phones, cars, watches, etc) surpassed the world’s population in 2010. By 2020, the number of ‘connected’ devices will reach 50 billion or more than 6 times the current world population of 7.3 billion. (Source: Federal Trade Commission)

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 rgartelmann@oldsecond.com
Jean Van Keppel CFA® – (630) 906-5489 jvankeppel@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Joel Binder, SVP – (630) 844-6767 jbinder@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz, VP – (630) 906-5467 ejgorenz@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC; not a deposit of, or guaranteed by, the bank; may lose value.

 

Wealth Management Economic Update June 13, 2016

U.S. and World News

  • Saudi Arabia has approved a plan to reduce public spending and to generate income without depending on oil. The plan is expected to boost non-crude revenues to $141 billion by 2020, create 450,000 non-government jobs, and help fund a large part of production of goods and services worth $72 billion.
  • The U.S. House of Representatives has passed legislation that will assist Puerto Rico with its debt crisis ahead of a $1.9 billion debt payment that it may not be able to pay. The bill consists of the U.S. putting a federal control board in charge of managing the restructuring of Puerto Rico’s $70 billion in debt. The bill now requires the Senate’s approval and will be started in the next few weeks.
  • zurich_switzerland_340A proposal to introduce a guaranteed basic income for every person living in Switzerland has been rejected by the country. Only 23.1% of the voters were for the proposal with the argument that a monthly income of 2,500 Swiss francs per citizen would promote dignity and public service, while 76.9% were against it saying that it would cost too much and cause damage to the economy.

Markets

  • Equity markets were flat again this week. The S&P 500 was down 0.15% for the week and closed at 2096. The Dow Jones dipped 0.33% and closed at 17,865. So far in 2016, the S&P is up 2.55% and the Dow is up 2.53%.
  • Interest rates moved lower further this week. The 5 year and 10 year U.S. Treasury Notes are now yielding 1.17% and 1.64%, respectively.
  • The spot price of WTI Crude Oil gained 0.66% this week to close at $48.98 per barrel. WTI Crude is up 18.44% in 2016.
  • The spot price of Gold gained 2.43% this week, closing at $1,274.43 per ounce. Year to date, gold prices are up 20.10%.

Economic Data

  • Initial jobless claims came in at 264,000 which was a decrease from last week’s reading of 267,000 reaching a post crisis low. The Labor Department noted no special factors in the data. The four week moving average for claims moved down to 270,000.
  • The University of Michigan’s index of consumer sentiment dropped to 94.3 from 94.7 in the June preliminary release which was in line with consumer expectations.
    •  Consumer sentiment remains new post-crisis highs, despite the negative jobs report last week.

Fact of the Week

  • Of the 10 largest cities in the United States, only Chicago has seen its population decline since the year 2000. 8 of the 10 largest cities have experienced population gains of at least +100,000, growth that only the cities of Chicago and Philadelphia were unable to achieve. (Source: Census Bureau).

Please contact a member of the Wealth Management Department if you have any questions about this information.

Rich Gartelmann CFP® – (630) 844-5730 rgartelmann@oldsecond.com
Jean Van Keppel CFA® – (630) 906-5489 jvankeppel@oldsecond.com
Brad Johnson CFA®, CFP® – (630) 906-5545 bjohnson@oldsecond.com
Joel Binder, SVP – (630) 844-6767 jbinder@oldsecond.com
Jacqueline Runnberg CFP® – (630) 966-2462 jrunnberg@oldsecond.com
Ed Gorenz, VP – (630) 906-5467 ejgorenz@oldsecond.com

Visit Old Second Wealth Management

Non-deposit investment products are not insured by the FDIC; not a deposit of, or guaranteed by, the bank; may lose value.

 

3 Reasons You Need a Will Today

Andy Roche, MBA, CPA, CFP®

June_andy_roche_portraitIf you don’t have a will, you’re not alone. Approximately 55 percent of Americans have yet to prepare this essential document.[1] It’s understandable: No one wants to spend a lot of time planning for when they are no longer around.

But as valid as the reason for avoidance is, every adult, regardless of age, should have a will. Here’s why.

Reason 1: It’s Not About You

Though a will is the legal expression of your last wishes, it’s really not about you so much as the people you care about. These are the people who will have to carry on…without you…and without directions on what to do with your financial and personal assets if you don’t leave a will.

When you don’t have a will, decisions like who receives your property and in what amounts are determined by state law. The matter can take months, and even years, to sort out if there are challenges by potential heirs. It can also lead to unintended consequences. For instance, parents or siblings you’ve been estranged from for years could end up inheriting your property rather than your fiancé or life partner.

Even if the state laws lead to the same distribution you would have preferred, the uncertainty can cause disagreements among your survivors. These can then result in lengthy and emotionally exhausting divisions over who was promised what and make holidays a minefield of hurt feelings and misunderstanding for years to come.

Reason 2: Unclear Future for Your Children

Arrangements for the care and custody of underage children are also covered within wills. State law and state welfare agencies can quickly get involved and undermine your intentions. For instance, custody could end up reverting to an ex-spouse despite your remarriage or bypass a life partner and send your children to live with a grandparent, or even foster care.

Reason 3: Undermining Your Legacy

For many, causes and support for community initiatives or organizations are important elements in their lives. Without a will, these causes may be left without your support—personal and financial.

Don’t Be That Person

As intimidating as it is to think about your last wishes, the process can be fairly simple, especially when you are younger and have a less complicated financial life.

Online legal advice services provide ready access to immediate, do-it-yourself options. But to ensure your assets are properly titled and your wishes accounted for, a family law attorney may be a better alternative.

If named as your executor or trustee, Old Second will enact your documents when the time comes. It’s an option that can spare your family from the responsibility and the time involved in settling an estate. Talk to any of our wealth management representatives about these services or if you need help creating a list of questions and considerations to discuss with your attorney. We can also review a draft of your documents once they are prepared and answer any additional questions that may have come up since your first meeting with your attorney.

 

[1] A.L. Kennedy, “Statistics on Last Wills & Testaments,” legalzoom.com, retrieved 5/21/16.