Client Newsletter 3Q23

Dear Ambassador Family,

I hope you are enjoying a wonderful summer! Let me update you on a few important topics.

Why You Want to Keep Your Financial Plan Up to Date

Only 2 years ago in 2021, we had a fantastic year in the markets. Sometimes, strong markets spur complacency. We made an effort to steer our clients away from it.

We encouraged our clients to be proactive while markets were on our side. We advised you to develop a financial plan and be ready for a downturn, should it come. We also urged you to challenge yourselves with probing questions, such as:

  • Where are you now?
  • Where do you want to be?
  • What is your timeline?
  • How much volatility can you afford?
  • Have you had major changes in your life?

At the beginning of last year, we spoke again and cautioned that 2022 might not be as good of a year for your investments. Concerns about rising interest rates and their impact on asset bubbles in real estate and other areas suggested caution about the kinds of investments you chose to make.  2023 has started out better, but we still have concerns as to how sustainable the rally might be.

It is easy to get caught up in your emotions when it comes to money.  Some people are prone to falling in love with certain investments. Many of you are close to retirement and worry about your financial situation once your paychecks stop coming in. Others, who are already in retirement, might find it quite difficult to suffer a reduction in investment income.

Those that planned ahead experienced solid returns and were in a better position to sustain their lifestyles in spite of the market volatility since 2022. 

However, those who lacked a strategic financial plan faced greater risk, and are more inclined to make ill-informed choices based on emotions and not rational, strategic planning.  Even with only moderate losses and a pickup in market volatility, they were more vulnerable to panic by obsession with the ups and downs of news produced by media outlets.

Having a well-thought-out strategic plan can significantly increase your likelihood for success.  When we understand how much time you have, how comfortable you are with taking risks, and how quickly you need access to your money, we can create strategies that are better at helping you. It’s like having a bigger toolbox to find the best solutions for you.

Changing Jobs? Consider a Direct Rollover IRA.
If you are changing jobs, you might benefit from directly rolling over your retirement investments from your previous employer to a direct rollover IRA. Done correctly, directly rolling over your investments to an IRA avoids the risk of a tax penalty if you failed to act after 60 days. It also allows you to save with continued tax deferral. An IRA provides greater investment options that might benefit returns and diversification. Consolidating accounts might also simplify your investments.

Potential risks include the loss of employer-provided benefits and the need for careful planning to meet the 60-day deadline. A corporate plan might also be cheaper.

Understanding the rollover process and executing it on time is essential to avoid tax penalties.

Despite the risks, changing jobs and using a rollover IRA potentially offer greater control and flexibility over retirement savings. Proper evaluation and planning might help mitigate risks and maximize the benefits of a rollover IRA.

Investment Update: When the Crowd Zigs, Zag

Recently, when I turned on the business news, many of the guests interviewed were waxing poetic about the attractions of the market and the end-of-recession prospects for 2023.  It left me scratching my head. 

Barely 1 in 20 names of the S&P 500 are actually up in 2023 (after a correction of most stocks in 2022).  The rally has focused mostly on names perceived to benefit from Artificial Intelligence (AI).  Valuations appear high relative to history, yet earnings for most of the market are not rising and falling in many cases. 

Banks and many stocks geared toward economic growth are down.  Only 3 months ago, several banks had failed because of large, sudden deposit outflows.  Now we are seeing default rates on commercial property loans pick up. 

Interest rates remain high and are not falling.  Stocks celebrated the Fed not raising rates in June, but Canada, UK, and Australia DID after taking similar pauses.  While headline inflation appears to be slowing, core inflation is resilient.

While we took up risk slightly in the first part of June for more aggressive accounts, at current levels, we are skeptical.  Yields on cash above 5% appear compelling relative to most other assets.  It is possible that the bubble mindset has returned to parts of the market, but without confirming fundamentals, it risks bursting.  The global economy shows pockets of weakness. 

Call us from Missouri (“Show me”), but we remain defensive in the near term and would not be surprised to see volatility return, perhaps as soon as this summer.

Spousal Rights & Retirement Plans
Married IRA owners usually do not need their spouse’s permission to choose a different beneficiary. However, if you have a company retirement plan, like a 401(k), you typically need your spouse’s consent. In some plans, you may also need spousal permission before taking a large lump sum distribution.

ERISA provides two types of financial protection for spouses (IRAs are not covered unless you live in a community property state).

Firstly, in all ERISA plans, spouses are automatically designated as the primary beneficiary unless the participant designates another beneficiary with spousal consent.

Secondly, unless the participant opts for an alternative payment form with spousal consent, their benefit must be paid as a special annuity known as a “QJSA.” This annuity provides a monthly benefit throughout the participant’s lifetime and, if the spouse survives, continues paying them for their lifetime.

The QJSA requirement applies to most ERISA-covered plans, excluding those without annuities as a payment option (i.e. 401(k) plans). However, it does include most ERISA 403(b) plans and defined benefit pension plans.

Mark Your Calendar for Labor Day Weekend!

Back in 2019, Charles Schwab acquired TD Ameritrade. Your account(s) will be transitioning to the Schwab Alliance platform over Labor Day weekend. This transition is on track to take place by Tuesday, September 5, 2023.

In preparation for this transition, you will be receiving communication from TD Ameritrade and Charles Schwab. I will highlight a few things you need to be aware of.

Key Takeaways:

  • Your TD Ameritrade accounts will automatically transition to Schwab Alliance on (or around) Tuesday, September 5, 2023.
  • After 9/5/2023, Charles Schwab will serve as your new custodian.
  • AWM will have all the same authorizations for trading, fee deduction and payment, and money movements.
August 25, 2023 Last day to request an incoming account transfer
September 1-5, 2023 Account information will be unavailable (8:30 p.m. ET on 9/1/2023 to 5:00 a.m. ET on 9/5/2023).
September 5, 2023 Account information will be available again at 5:00 a.m. ET.

Accessing Your Schwab Alliance Account

Starting Tuesday, September 5, you will access your account(s) through Schwab Alliance (

  1. If you have a Schwab Login ID and password, there is nothing you need to do. You can log in with these credentials.
  2. Need to set up your Schwab Login ID and password? Go to and select New Schwab User, then follow the prompts.

AWM Client Portal

Once the TD/Schwab merger is complete, it may take a few extra days for your Schwab accounts to appear in your client portal. We thank you for your patience during this merger.

If you have any questions or concerns, please reach out to us. We will do our best to answer your questions and help however we can.



Petr Burunov, CFP®
President / Wealth Strategist

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