1st Quarter Newsletter 2019

NEWSLETTERWith Knowledge Comes Condence
FIRST QUARTER 2019

Upcoming Workshop: Market Briefing

After the S&P 500 Index hit market highs in third
quarter, fourth quarter wrapped up 2018 in negative
territory for the first time since 2008. With bonds facing
headwinds from rising interest rates and international
stocks underperforming domestic stocks, investors are
understandably nervous about what the future holds. With
that in mind, our annual Market Briefing may help bring
some clarity and calm nerves.

At the briefing, we will look at the
history of investing, put 2018 into
perspective, then turn our focus to
2019 and beyond.

We hope you will join us!

This event is open to the public, so feel free to bring a
friend or pass this information along to those who may be
interested. Refreshments will be served. There is no cost for
this event, but space is limited, so reserve your spot today!

WORKSHOP DETAILS: WHO: Anyone! Whether you’re a client of the firm or
not, we encourage you to attend and bring a friend.
RSVP: By Wednesday, April 17 by calling
317-872-5090 or emailing WHEN: Wednesday, April 24, 6-7:30 p.m.
[email protected]
WHERE: The Pyramids, Pyramid Three,
COST: None, but space is limited. Lower Level, Conference Room A & B
(3500 DePauw Blvd, Indianapolis, IN 46268)

Worley Erhart-Graves Financial Advisors is a Registered Investment Advisor. Registration as an investment advisor is not an endorsement of the firm by
securities regulators and does not mean the advisor has attained a particular level of skill or ability. All expressions of opinion reflect the judgment of
the authors as of the date of publication and should not be construed as personalized investment advice. Different types of investments involve varying
degrees of risk, and there can be no assurance that any investment will either be suitable or profitable for a client’s portfolio. Worley Erhart-Graves Financial
Advisors is not engaged in the practice of law or accounting. Always consult an attorney or tax professional regarding your specific legal or tax situation.
Worley Erhart-Graves Financial Advisors, Inc., is affiliated with Smitson Erhart-Graves Tax Advisors, LLC, through common control and ownership. Smitson
Erhart-Graves Tax Advisors provides accounting and tax preparation services. If you require such services, we may recommend you use Smitson Erhart-
Graves Tax Advisors, although you are under no obligation to do so. Fees for financial planning and investment advisory services are separate and distinct
from the fees Smitson Erhart-Graves Tax Advisors charges for their services.

Feeling Secure

Juli Erhart-Graves, CFP®

Like everyone, my personality, values, dreams, and hang-ups One of the perks of my job (at least in my eyes), is talking to
have been shaped by my childhood. For various reasons, I clients and learning about their experiences. The good, the
didn’t feel like I had much security in my life while growing bad, and the ugly help me become a better financial planner
up. I developed a strong sense that I had to fend for myself. To and help me continue to work toward security in my own
be fair, though, I think being the first born, with all the typical life—because, you know, security is never one of those things
first-born traits, has played into this as well. Regardless, I crave you attain and then sit back and relax! Sometimes they are big
security in my life as an adult—I always have, and I assume I things and sometimes they are little. Regardless, I learn from all
always will. I want to make sure I have a plan for everything, of it.
along with a Plan B, in case things change.
One of the little things I learned came out of a client getting
her wallet stolen. As I listened to her story, I put myself in her
shoes and saw the inconvenience a stolen wallet would cause.
Trying to remember everything that was in the wallet was the
first hurdle, then it would be a matter of alerting all the banks
and credit cards, getting replacement membership cards, and
more. I wasted no time and copied everything in my wallet
(front and back), and now I keep those copies at home. I did
this for my husband and daughter as well.

In the end, I hope my drive for security helps my clients feel
secure themselves.

Do Your Adult Children Have
a Medical Advocate? Gail Gill, CFP®

It’s ski season and my family is heading out west for some (pre-signed by the patient giving me authority) allows me
fun in the snow. It always seems like there’s so much to to confer with the medical staff, whereas the Healthcare
pack (jackets, skis, poles, helmets, gloves, etc.), but there Directive form allows me to make medical decisions if the
are two more items that I require my adult children to patient is unable to speak for themselves.
bring:
When you show up at a hospital with these forms in hand, the
• HIPAA Form* hospital administrator immediately knows he/she can discuss
the patient’s situation with you. It’s like you’ve been instantly
• Healthcare Directive Form upgraded in how you’re treated. The staff appreciates that
you have come prepared and have made their job easier.
Snow skiing can be a dangerous sport. So, if an emergency Medical emergencies are always shocking and chaotic. So be
ski accident arises, I don’t want anything standing between prepared and add these documents to your file.
myself and the hospital when it comes to my adult child
receiving the best medical treatment. You see, I want to be *HIPAA is United States legislation that proves data privacy
their advocate, and to do that the hospital needs to know and security provisions for safeguarding medical information
that I have been given that authority. That’s why I carry (on (Health Insurance Portability and Accountability Act of 1996)
my digital device) a HIPAA and Healthcare Directive form
for each of my adult children. The signed HIPAA form

Quarterly Estimated Tax Payments:
Why, When, and How Much? Pam Smitson, CPA, CGMA

As you know, we are in the thick of tax season, and I’m finding capital gains, and flow-through or sole proprietor business
a lot of clients want to learn more about quarterly estimated income.
tax payments. Perhaps the new tax laws changed their situation
enough to warrant estimated tax payments, or perhaps they The IRS rules base expected withholdings on the prior year
have experienced a life change, like retirement. Regardless, I tax liability (2018). Depending on the taxpayer’s Adjusted
thought it would be helpful to rerun, with updates, an article Gross Income (AGI), either 100% or 110% of the prior year tax
from a couple of years ago explaining the why, when, and how is expected to be paid in to avoid an underpayment penalty.
much of quarterly estimated tax payments. If the taxpayer’s AGI is $150,000 or more, the higher 110% is
expected. The goal of quarterly estimates is to protect the
Tax preparation consists of more than just preparing the prior taxpayer from penalties. However, too much withholding
year return. It prepares you for the current year tax liability by is also to be avoided because it deprives the taxpayer from
assessing the need for quarterly estimated tax payments, which valuable cash flow.
are due in April, June, September, and the following January.
The only cushion in avoiding under-withholding penalties The IRS understands that circumstances change tax liabilities
without paying estimates is if the taxpayer’s bill, when all is said from year to year. Therefore, there is an alternative to paying
and done, is less than $1,000. Otherwise, under-withholding in a minimum of the prior year tax. The 90% rule is used in
penalties may apply. these circumstances and is calculated (I use the term loosely,
because it is more of a guess) on the current year (2019) tax
Quarterly tax estimates are usually needed when the taxpayer liability. This can be a challenge, because the due dates of
has income without the appropriate withholding to cover the the quarterly estimates occur before the actual tax liability is
tax liability. This happens when withholdings are not enough known.
(resulting from taking too many exemptions against your
wages) or ignored completely (not having any withholdings You may ask, “Do I need to pay them if my preparer provides
applied from retirement distributions or Social Security). them?” The answer rests with you. I recommend you pay
Estimates may also become an issue due to income where them. However, the worst-case scenario is you will need to
withholdings are not an option, such as interest, dividends, pay the penalty on top of the tax due in April.

Do You Know the Way to San Jose?

Bonnie Struck, CMFC®

When I hear the Dionne Warwick song “Do You Know the One of my first mistakes was routing a truck to San Jose,
Way to San Jose?” I am reminded of my early career as a California, instead of San Jose, Texas. It was 1983 and
Shipping Supervisor in Tennessee. In my senior year at IU, computers were a thing of the future in the logistics field,
I was recruited by Frito Lay as the first female Shipping so routing trucks was done manually. I remember my
Supervisor in the history of the company. It was exciting and manager calling me to his office and pointing to a map. He
equally intimidating. I relocated by myself from Bloomington said something to the effect of, “You college grads think
to Pulaski, a city with a population of less than 8,000. That in you know everything, yet you sent a full truck to the wrong
itself was overwhelming, but I had no idea what the future state.” I was horrified but, fortunately, he caught the error
held. My staff consisted of middle-aged male truck drivers and early and dispatched the truck correctly. My guys had a great
warehouse workers. Believe you me, as a 22-year-old single laugh at my expense, but it somehow bonded us and was the
woman from the northern U.S., it required thick skin. Trying to beginning of mutual respect and lifelong friendship with my
acclimate to a new city, southern culture, and career was no manager. Although devastating at the time, he often reminds
easy task, and my staff tested me every step of the way. me of that day, and I can smile now.

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INDIANAPOLIS, IN
PERMIT NO. 937

3500 DePauw Blvd. | Suite 1035
Pyramid One, Third Floor
Indianapolis, IN 46268

317.872.5090 Phone
855.872.5090 Toll Free
317.872.5095 Fax

wefinancialadvisors.com

It is important to us to stay involved in the Central Indiana community. One of BRUNCH & BLINGO
our most recent upcoming community activities is our sponsorship of Brunch & Saturday, April 13 | 9:30 a.m.
Blingo benefiting Ronald McDonald House of Central Indiana. Brunch & Blingo Indianapolis Art Center
consists of a brunch buffet, mimosas, a chance to win dazzling Kendra Scott
jewelry, and—you guessed it—playing bingo! Benefiting Ronald McDonald
House of Central Indiana
Brunch & Blingo is on Saturday, April 13 at the Indianapolis Art Center. Doors open
at 9:30 a.m. Proceeds will benefit the Ronald McDonald House of Central Indiana.

When registration opens, tickets sell out quickly. Like Worley Erhart-Graves on
Facebook to be notified when they go on sale.