Month: January 2022

What’s Love Got to Do With It? How to Prep Yourself for a Downturn

Find the bargains. Own the orchard for the fruit crop. Avoid the stampede.

Our three main principles form a pretty clear constellation, guiding our practices here at 228 Main. They are action-oriented, so it’s not hard to tell day to day whether we’re sticking to them.

But what makes us stick with them, especially if we’re bracing for a downturn?

In life, when the going gets tough, our defenses can erode pretty quickly. Our energy flags. Anxiety kicks in. And loss can trick us into believing that good times will never return, that the hurt wins.

Writer and businessperson Arianna Huffington suggests a simple way to get sound decision-making back on track: choose love.

“You’ve got to make your heart bigger than the hole,” she says in her book Thrive. “You just have to make your decisions out of love. And when we make the decisions out of fear, that’s when we have problems.”

Trouble and triumph, set-ups and setbacks—those are constants, and our lives travel the roads back and forth to each. Why should we let fear take the wheel for any part of the journey?

Clients, we know that you’ve felt these truths: it’s part of what makes you the best clients in the whole world, after all. Let this be a reminder, then. We’re with you. We journey together.

When you’d like to talk about this—or anything else—please write or call.


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What Do We Mean By “Plans” and “Planning”?

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Many things are made by combining some of this, some of that. In our work with you, for example, we combine some information about your life now with a vision to get us ready for the future. Here as another new year begins, our thoughts have turned to plans and planning—and the nuances therein.

A typical New Year’s resolution is a sweeping, major goal: write a book, finish a 5k race, lose this many pounds. They tend to skip a few steps. It’s about the accomplishment, not the accomplishing.

But it could be more effective to plan a tiny step, something to execute now.

Write a page.

Walk around the block.

Eat a nutritious meal.

And if we focus on accomplishing a tiny step, then another, then another, those steps may compound into major accomplishments.

You might recognize the idea at the heart of this formula: habits are the practical foundation in shaping the person we want to become. Writing one page, then another, then another. If it becomes a daily habit, you may end up authoring a book.

Likewise, it’s easier to save something every payday than it is to worry for years about the fortune you will require for retirement. We can invest by automatic monthly deposits, for example, instead of having to think about it every time.

When we can make our habits automatic, they become a lot easier to maintain. (We don’t stop and question whether and how and when to brush our teeth each day, right?)

The planning moves you closer to the plan; the doing gets things done. Wisdom? Nonsense? You decide.

When you are ready to work on your plans and planning, we’ll be happy to talk with you about the steps that may help you get there. Email us or call.


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What Do We Mean by "Plans" and "Planning"? 228Main.com Presents: The Best of Leibman Financial Services

This text is available at https://www.228Main.com/.

Let’s Talk! (You Couldn’t Pay Me to Stop)

Converse, communicate, babble, blather, rant, rave… I love to TALK! Preaching to the choir, but it’s worth reminding everyone: I’m here to do this. By choice. More in this week’s aptly-titled video.


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What the IRS Knows: Getting Down to Brass “Tax”

photo shows a light letter box with the word "TAXES" sitting on top of various cash bills

While paying taxes is generally a good sign that you are making money, it seems most people want to avoid paying more tax than they need to. It’s a common enough question we field, and one worth considering.

How do we handle the tax impacts of our choices?

For smaller investors with tax-deferred vehicles like IRAs or 401(k) plans, tax considerations are simpler. Only deposits and withdrawals have any tax implications (and for Roth IRAs, rarely even then.)

Things get more complicated for investors with substantial balances outside of retirement accounts: most trading activity has tax impacts. You pay taxes on interest and dividend payments; you also become subject to capital gains tax when selling investments.

The principle of capital gains is straightforward enough. For instance, if you buy stock for $100 and later sell it for $100, you made no money and owe no tax. If you were to sell it for $110, you would have to pay some percentage of the $10 profit in tax (but not the rest of the $100: that was money you had in the first place.) And if you sold it at $90, you would have a loss of $10 that you could use to offset taxable gains elsewhere.

The important thing here is that the IRS generally only cares about the value of investments when they are bought or sold. If your $100 stock position balloons up to $1,000 one year and then collapses back down to $100 the next, the IRS has no interest in the round trip. They only see the difference from your original purchase, regardless of how high or low the price got in the meantime.

It is easy to despair when an investment is underperforming, but according to the IRS, those losses do not exist until you decide to sell. And if a high-flying investment should pull back from its highs, the IRS would give you a very funny look if you tried to claim it as a loss.

So if the IRS does not care about your gains or losses “on paper,” why should you? A drop is not a loss, and value at inception is a great anchor to come back to when you need a jolt of perspective.

And if after all this you find yourself with more resources than you would need in your lifetime, there are estate planning opportunities to consider. If you are sitting on long-term investment gains that you do not think you will be spending, there is little reason for you to sell those holdings and pay taxes on your gains yourself.

If those assets are passed down to your heirs, however, they would generally only need to worry about gains made after they inherited them, so whatever gains you accumulated during your lifetime can pass to them tax-free.

Lots to think about! It’s an important topic for many investors. Clients, when you need to talk about your tax considerations, please reach out.


This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.


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What the IRS Knows: Getting Down to Brass "Tax" 228Main.com Presents: The Best of Leibman Financial Services

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It’s Not All Bad News? A Closer Look at Some Newsworthy Numbers

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The number of numbers in the news can be… overwhelming, at times. Records of all kinds are broken every day, but here’s the good news: it’s not all bad news.

Trends ebb and flow, and we’re noticing some promising signs. Let’s break down a few.

First, remember that life is a mixed bag. The past two years have brought considerable heartbreak and stress, but any change also tends to make way for new growth.

Anecdotally, we’ve been heartened by the number of stories we’ve heard from you about businesses using their downtime well. Closures gave many folks the opportunity to refurbish or expand their operations—your coffee shop opening a new location, your favorite storefront getting some much-needed repairs. And so many grocery stores and retailers continue to develop their services, like the infrastructure for easier pickups and deliveries.

And then some numbers take a little more consideration to appreciate. For example, the most recently released data suggest that it’s quitting time for many Americans. In the final months of 2021, more Americans than ever were leaving jobs—by the millions—DealBook reports. This can be a great sign, as quits tend to happen when workers feel the outlook is good, that something better must be next. A quit trend like this sometimes accompanies a period of fast economic growth. No guarantees, but at least the sentiment is that many are looking forward to a better future.

Another bright spot is the surge in business applications: Americans are starting new businesses at the fastest pace in years. The New York Times explains that the number of business applications rose 25% from 2020 to 2021. That’s typically a sign of new energy being generated in the economy. When the rate of business formation is slow, it’s a sign that jobs are going stale, business relationships can get strained and rigid. Upheaval, however, has many working people rethinking their opportunities.

All this is to say that things are moving, things are changing. It’s never all good news; it’s never all bad news. We’ll be here. We’ll keep at it.

And we’re glad you’re with us.

Clients, got any numbers worth discussing? Call or write, anytime.


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It's Not All Bad News? A Closer Look at Newsworthy Numbers 228Main.com Presents: The Best of Leibman Financial Services

This text can be found at https://www.228Main.com/.

The Price Is Right! Come on Down… or Up!

A bargain is a bargain, right? We seek those opportunities that may be undervalued by others right now. But there are other types of bargains lurking, too: those opportunities that get the label of overvalued right now… but may actually have years of growth ahead of them!


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When We Overcrunch the Numbers

graphic shows a photo of a calculator, graph paper, and glasses, all pixelated

I was recently amused by an online debate among some financial planners. One planner was wondering how to “deal” with a client who wanted to pay off their mortgage early, given that they could invest their extra money instead.

My amusement came from observing those who believed their calculators or spreadsheets could provide a definitive answer to the question. Was it better to make larger mortgage payments or to invest more?

They seemed to confuse their analytical tools with an ability to know the future.

Most argued that the “correct” answer was to invest more rather than pay down the debt, because their tools showed greater ending wealth by doing so. To them, the spreadsheet was the truth. (Usually, they did did at least concede that an emotional insistence to pay off the mortgage might offer the benefit of greater peace of mind.)

None, however, acknowledged that we cannot know the future. Hence there is always uncertainty about the “best” course financially. It is possible that the path to greatest future wealth is via debt reduction, rather than investing more. No one has been to the future and back; there are no guarantees about it either way.

We do know these things: if the future is like the past, chances are one might end with more wealth by investing. And one might reduce uncertainty and increase financial security by paying the mortgage. But we don’t know if the future will be like the past.

The spreadsheet is not the future.

I wonder if there are more interesting questions worth debating… If you have what you need, what is the point of pursuing more? How do you value the feeling of owning a paid-off home? No spreadsheet—and no planner—can answer these questions for you.

Clients, when you’d like to explore the interesting questions, please email us or call. We’ll talk about it.


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It’s All About the Numbers and Feelings but Also Numbers and Don’t Forget Feelings

photo shows a journal page with "I want..." written on it

“We figure out what we want with our feelings. We learn everything we can learn from the numbers.” — Me 

Sometimes new clients are surprised when most of our work together is conversation. There’s very little button-clicking on a computer that will do us any good while we’re meeting. And there’s no chart or binder just sitting in my office—or anywhere!—that can tell us what we need to know: 

  • What does money mean in your life? 
  • What are your goals? 
  • What’s working? What could be better? 

There are choices to make that do involve some math, of course. That’s a big part of our role. But your job? Figuring out what you want and how you feel about how to get there. 

In their book No Hard Feelings, Liz Fosslien and Mollie West Duffy explain, “When people talk about decision making, they tend to assume that feeling something and doing something with those feelings are the same thing.” Some folks notice a feeling swell up in the process and try to shoo it away, thinking it will only gum things up. Surely, if we “open the floodgates, we’ll be bowled over by the crush of our emotions.” 

But that’s not giving ourselves much credit, is it? Gut feelings aren’t random signals. They can be clues to our self-knowledge. Ever bought a house, juggled job offers, or gone on a first date? 

Our feelings can help us figure out what we can live with and what we cannot. And as we’re fond of saying, “your money, your life.” No matter what happens in our conversations, clients, you’re still the one that has to live with your life—not us. 

We’re here as partners, collaborators, coconspirators… you get the idea. Reach out when you’re ready.


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It's All About the Numbers and Feelings but Also Numbers and Don't Forget Feelings 228Main.com Presents: The Best of Leibman Financial Services

This text can be found at https://www.228Main.com/.

A Terrible Case of the “Shoulds”


Better sleep can contribute to a longer life. Who are we to get in the way of your peace and calm? Your choices are yours. Don’t let anybody “should” all over you!


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If All Your Friends Did It…

photo shows a pile of pigeons sitting on top of each other on a telephone wire in a partly cloudy sky

“If all your friends jumped off a bridge, would you?” 

Does this line give you any childhood flashbacks? (Rhetorical questions abound in today’s reflection!) We’ve been noticing the number of headlines featuring the word “concern.” 

  • “Is this development a cause for concern?” 
  • “Top officials express ‘concern’” 
  • “Latest numbers raise concern” 

Whether it’s about the latest COVID-19 variant, rising prices for consumers, or bottlenecks in logistics, there seems to be plenty of concern going around. 

We’d like to pause here, though, for an important distinction: “concern” is not the same as “panic.” Life is full of “troubling developments.” We get to choose which stimuli rev us up and which improve our view of reality. Aren’t we better for having a more accurate picture? 

On a recent morning, I noticed lots of action online and in the news that might have startled some investors. I decided to spend a few hours in the office that I hadn’t planned on, just in case there were calls to catch from you, clients. There wasn’t a single ring. 

I should’ve known better. 

“If all your friends jumped into a panic, would you?” Of course not. In fact, there’s that other classic line that makes a lot more sense: “This is no time to panic.” 

Panic rarely helps. Those bursts of energy may have served us when it was time to run from an animal of prey, but these days that’s not exactly a regular demand.

Soothe your system, then let’s get some perspective, gather the facts… and go from there. The leap to panic is a shorter—but way more costly—trip. Clients, want to talk through anything troubling? You know I’m here for that. Write or call, anytime, and we’ll sort it out together.


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