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Michael Sceiford

Edward Jones Financial Advisor Michael Sceiford of Port Jefferson has been named to the 2023 Forbes Top Next-Gen Wealth Advisors Best-in-State ranking by Forbes/SHOOK® Research. The list is comprised of more than 1,460 financial advisors nationwide, all under age 40.  Sceiford ranked No. 9 in New York State. 

This ranking is given to the top financial advisors under 40 in their respective states based on criteria that include compliance records, assets under care and more. 

“This is an incredible honor, one I could never have achieved without the tremendous support from my branch team. And I am forever indebted to my clients for the trust they have put in me and the relationships we’ve built as we work toward the financial goals that help give them the freedom to live life on their terms,” Sceiford said. 

“This work inspires me because I know that, for years to come, I can make a meaningful difference in the lives of my clients and colleagues, and in my community,” he said. 

Michael Sceiford and branch office administrator Pam Guido can be reached at 631-928-2034. You may also visit the branch website at edwardjones.com/michael-sceiford.

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Labor leader Joseph James Ettor (1885-1948) speaks in Union Square during the Brooklyn barbers’ strike of 1913. Public domain photo
By Aramis Khosronejad

Amid Labor Day celebrations, Long Island is working through a labor shortage crisis, according to New York State Assemblywoman Jodi Giglio (R-Riverhead), a member of the Assembly’s Standing Committee on Labor.

Like much of New York state, Suffolk County is navigating through various labor challenges such as its relatively high unemployment rate, lingering effects of the COVID-19 pandemic, high cost of living and rising inflation. 

Labor shortages

According to the 2023 Long Island Economic Survey, “We are in the midst of one of the nation’s biggest labor crises on record, with significant labor shortages affecting all industries and geographies.” 

In an interview, Giglio expressed her concerns for Long Island’s labor, suggesting “a lot of businesses [are] putting up help wanted signs and looking for somebody to fill these positions.” 

This July, according to the New York State Department of Labor’s Jobs and Labor Force press release, the unemployment rate in New York state “held constant at 3.9%. The comparable rate for the U.S. was 3.5%.” 

When asked whether she would consider the current labor shortage a crisis, Giglio replied, “Absolutely, it is a crisis.”

Post-pandemic recovery

The Long Island workforce is still feeling the long-term impacts of the pandemic, according to Giglio. She said much of the financial hardships were brought on by malfeasance.

“I think there was a lot of money that was stolen from the state by unemployment, fraud, and people [who] were finding ways to live less expensively,” Giglio said. Additionally, “Businesses are really struggling to stay afloat.”

Cost of living

Attributing a cause to growing labor shortages, Giglio offered that fewer young people are staying put. 

“It seems as though the kids that are getting out of college are finding different states to live in and different states where they can get meaningful jobs,” she said. “The high cost of living in New York and the jobs that are available are not able to sustain life here in New York, especially on Long Island.”

Wages

While the high standard of living in New York may be one factor contributing to labor shortages on Long Island, stagnating wages present yet another barrier.

The founder of Long Island Temps, Robert Graber, explained the complications of wages and inflation. 

“Wages have gone up, but inflation is outpacing the wage increase,” he said. “That makes it harder to recruit and fill positions.”

Migrant labor

Since spring 2022, a wave of migrants have entered New York state, the majority arriving in New York City. When asked if this migrant surge could help resolve the labor shortages islandwide, Giglio expressed some doubts. 

“I’ve been talking to a lot of business owners and organizations that have been trying to help migrants that are coming into the city, and some even making their way out to Long Island,” the assemblywoman said. “Some of their biggest problems are that they don’t have any documents, identification from their countries, nor do they have a passport, and they don’t have a birth certificate.” 

Giglio added that this lack of information could undermine effective integration into the Long Island labor force. “It’s really putting a strain on the government and the workload,” she said.

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Pixabay photo

By Michael Christodoulou

You’ll find some big differences between traditional and speculative investments — and knowing these differences can matter a great deal when you’re trying to reach your financial goals.

To begin with, let’s look at the basic types of traditional and speculative investments. Traditional investments are those with which you’re probably already familiar: stocks, bonds, mutual funds, government securities, certificates of deposit (CDs) and so on. Speculative investments include cryptocurrencies, foreign currencies and precious metals such as gold, silver and copper.

Now, consider these three components of investing and how they differ between traditional and speculative investments:

The first issue to consider is risk. When you own stocks or stock-based mutual funds, the value of your investments will fluctuate. And bond prices will also move up and down, largely in response to changing interest rates. However, owning an array of stocks — small-company, large-company, international, etc. — can help reduce the impact of volatility on your stock portfolio. And owning a mix of short- and long-term bonds can help you defend yourself somewhat against interest-rate movements. 

When interest rates fall, you’ll still have your longer-term bonds, which generally — but not always – pay higher rates than short-term ones. And when interest rates rise, you can redeem your maturing short-term bonds at potentially higher rates.

With speculative investments, though, price movements can be extreme as well as rapid. During their short history, cryptocurrencies in particular have shown astonishingly fast moves up and down, resulting in huge gains followed by equally huge, or bigger, losses. The risk factor for crypto is exacerbated by its being largely unregulated, unlike with stocks and bonds, whose transactions are overseen by well-established regulatory agencies. There just isn’t much that investors can do to modulate the risk presented by crypto and some other speculative investments.

A second key difference between traditional and speculative investments is the time horizon involved. When you invest in stocks and other traditional investments, you ideally should be in it for the long term — it’s not a “get rich quick” strategy. But those who purchase speculative investments want, and expect, quick and sizable returns, despite the considerable risk involved.

A third difference between the two types of investments is the activity required by investors. When you’re a long-term investor in traditional investments, you may not have to do all that much once you’ve built a portfolio that’s appropriate for your risk tolerance, goals and time horizon. 

After that point, it’s mostly just a matter of monitoring your portfolio and making occasional moves — you’re not constantly buying and selling, or at least you shouldn’t be. But when you speculate in crypto or other instruments, you are constantly watching prices move — and then making your own moves in response. It’s an activity that requires considerable attention and effort.

One final thought: Not all speculative instruments are necessarily bad investments. Precious metals, for instance, are found in some traditional mutual funds, sometimes in the form of shares of mining companies. And even crypto may become more of a stable vehicle once additional regulation comes into play. 

But if you’re investing for long-term goals, such as a comfortable retirement — rather than speculating for thrills and quick gains, which may disappear just as quickly — you may want to give careful thought to the types of investments you pursue.

Michael Christodoulou, ChFC®, AAMS®, CRPC®, CRPS® is a Financial Advisor for Edward Jones in Stony Brook. Member SIPC.

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Pixabay photo

By Nancy Burner, Esq.

Nancy Burner, Esq.

In December 2017, Congress passed the Tax Cuts and Jobs Act (“TCJA”).  This tax bill was an overhaul of the tax law affecting individuals and businesses in many ways. One of these changes substantially increased the Federal estate tax exemption.  

At the time the law was inked, the Federal Basic Exclusion Amount for an estate was $5.49 million ($5 million, indexed for inflation).  This meant that no taxes would be owed on the estate of a person dying in that year with a taxable estate less than that.  For estates over that amount, the overage was taxed at 40%.

The TCJA stated that for deaths in 2018, the exemption increased to $10 million, indexed for inflation.  Currently, in 2023, the estate tax exemption is $12.92 million.  This is an individual exemption, so a married couple enjoys $25.84 million between them.  

While this increased exemption is helpful for many families, it is not a long-term solution.  The law expanded the exemption but only for a limited period of time.  Barring any action by Congress to extend this further, this and other provisions of the TCJA sunset at the end of 2025.  As a result, where an individual dies on or after January 1, 2026, the exemption will return to the pre-2018 scheme of $5 million, indexed for inflation (likely to be just under $7 million).  For single persons with less than $7 million in assets, and couples with less than $14 million between them, there is no cause for concern when it comes to Federal estate taxes, even after the sunset.

With this looming sunset of the exemption amount, couples and single individuals may be able to take advantage now of the higher exemption amount with proper planning.  An alphabet soup of tools are available including SLATs, GRATs, IDGTS, etc.  The general idea being to remove assets from your taxable estate while you are alive, utilizing your expanded exemption, thus reducing the taxable assets at the time of death and passing more along to your beneficiaries.  There are also planning mechanisms for the charitably inclined that will serve to further reduce one’s taxable estate.

For New Yorkers, the State estate tax, currently $6.58 million, has been the larger concern.  Unlike the Federal, the New York exemption is not “portable” between spouses, meaning that the exemption of the first spouse to die cannot be saved to be used when the second spouse dies. Planning must be done to utilize each spouse’s exemption at the time of their respective deaths. 

Not all planning opportunities will suit your individual circumstances.  Determining the proper estate planning tools will depend upon your family structure, asset structure, and intended beneficiaries.  You should speak with your estate planning attorney today to better plan for tomorrow. 

Nancy Burner, Esq. is the founder and managing partner at Burner Prudenti Law, P.C. with offices located in East Setauket, Westhampton Beach, New York City and East Hampton.

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METRO photo

By Michael Christodoulou

When you retire, you’ll experience many changes — should one of them involve your living arrangements?

The issue of downsizing is one that many retirees will consider. If you have children, and they’ve grown and left the home, you might find yourself with more space than you really need. Of course, this doesn’t necessarily mean you must pack up and scale down yourself. You might love your home and neighborhood and see no reason to go. But if you’re open to a change, you could find that moving to a smaller house, a condo or an apartment may make sense for you.

Let’s consider some of the advantages of downsizing:

You could save money. Moving to a smaller space could lower your utility bills and upkeep costs.

You could save effort. A smaller home will mean less maintenance and cleaning.

You could de-clutter. Over the years, most of us accumulate more possessions than we really need. Downsizing gives you a chance to de-clutter. And you can do some good along the way, too, because many charitable organizations will welcome some of your items.  

You could make money. If you’ve had your home for many years, it’s certainly possible that it’s worth more — perhaps a great deal more — than what you paid for it. So, when you sell it, you could pocket a lot of money — possibly without being taxed on the gains. 

Generally, if you’ve lived in your home for at least two years in the five-year period before you sold it, you can exclude $250,000 of capital gains, if you’re single, or $500,000 if you’re married and file taxes jointly. (You’ll want to consult with your tax advisor, though, before selling your home, to ensure you’re eligible for the exclusion, especially if you do own multiple homes. Issues can arise in connection with determining one’s “primary” residence.)

While downsizing does offer some potentially big benefits, it can also entail some drawbacks. First of all, it’s possible that your home might not be worth as much as you had hoped, which means you won’t clear as much money from the sale as you anticipated. Also, If you still were paying off a mortgage on your bigger home, you may have been deducting the interest payments on your taxes — a deduction that might be reduced or lost to you if you purchase a less-expensive condo or become a renter. 

Besides these financial factors, there’s the ordinary hassle of packing and moving. And if you’re going to a much smaller living space, you may not have much room for family members who want to visit or occasionally spend the night.

So, as you can see, you’ll need to weigh a variety of financial, practical and emotional issues when deciding whether to downsize. And you will also want to communicate your thoughts to grown children or other family members who may someday have reason to be involved in your living space. In short, it’s a big decision — so give it the attention it deserves. 

Michael Christodoulou, ChFC®, AAMS®, CRPC®, CRPS® is a Financial Advisor for Edward Jones in Stony Brook. Member SIPC.

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Unsplash photo

By Michael E. Russell

Michael E. Russell

After many years running the most politically active financial empire, Socialist George Soros is passing the baton of his $27 billion Open Society Foundation to his son, Alex.  

Those of us who cringed at many of George Soros’s comments and investment strategies longed for the day when he would retire. Unfortunately, the elder Soros who contributed unabashedly in excess of $1.5 billion to extreme causes has picked the second youngest of his five children to be the Foundation Chair. Alex will also serve as President of the Soros super PAC and is the only family member on the investment committee for Soros Fund Management, a private investment management firm.  

The younger Soros will now oversee a philanthropic empire, funded from the many billions that George Soros made from finance.  I am sure that many readers are impressed by his financial acumen. However, those of us who worked in the field remember that in 1992 Soros shorted the British Pound and reportedly made a profit of $1 billion dollars.  Unfortunately, he almost broke the Bank of England! A hero to some, certainly not me. I will leave it to the readers to do their own research on the Soros empire. Just trying to get you motivated to see how some people get filthy rich.  

Allow me to mention an investment icon to look up to, Warren Buffett. At 92 years of age, he appears to be as sharp and engaged as ever. Mr. Buffett has been extremely active in the stock market this year, as well as last year, highlighted by the purchase of 25% of Occidental Petroleum. He probably read my article last month about how I felt the Japanese market was undervalued because he now has holdings in five Japanese trading companies worth $20 billion dollars. Once again, another reason to subscribe to TBR News Media. I believe he has done very well on his own without my advice. Buffett’s Apple purchase is now worth more than $165 billion dollars, quite a bit more than the $30 billion he invested. 

In 1965, Warren Buffett took over Berkshire Hathaway. Due to his efforts over the past 58 years, the fund generates $35 billion dollars in annual earnings power. A $20 dollar investment in 1965 is now worth more than $500,000, an incredible $25,000-fold increase. No wonder he calls Berkshire Hathaway his Mona Lisa.

Another financial icon who I admire is Jamie Dimon, the CEO of JP Morgan Chase.  Jamie has few peers in his field. His advice is sought by many world leaders when he travels abroad. JP Morgan Chase is now the country’s top bank, putting distance between itself and Bank of America, the bank that loves charging client fees. 

Jamie has proven to be an exceptional CEO. The bank had a very strong 2022 when it had the highest return on tangible equity among its peers. Dimon avoided huge losses experienced by Bank of America by not investing assets in bonds at historically low rates in 2020 and 2021. JP Morgan stock returned 30% last year, tops among its rivals. Jamie Dimon was the leading advisor to Federal Chair Jerome Powell and Treasury Secretary Janet Yellen. I would have preferred that they had listened to him more often. Hopefully, now they have him on speed dial.

As far as the market — we can look for further rate increases due to continued inflation concerns. For those of us looking for safety, a 5% 2-year Treasury bill looks attractive. My favorite stock, Nvidia, has paused recently closing at $422, up a mere 195% year to date. 

For those of you Crypto folks, Tether’s stablecoin will rake in $6 billion dollars of profits this year. Tether Holdings is the issuer of the largest stable coin which are like crypto cash. Typically, they hold a $1 price backed 1/1 in reserves.  It now has $83 billion dollars in deposits.  With rates increasing, Bitcoin and most of crypto have dropped in value, while Tether has become the world’s most profitable digital asset. It has kept most of its assets in U.S. treasury bills; a 5% return on $83 billion dollars is not chump change.

I hope most readers realize that some things that I write are meant to be tongue in cheek, however not all! Have a wonderful July 4th and God Bless America.

Michael E. Russell retired after 40 years working for various Wall Street firms. All recommendations being made here are not guaranteed and may incur a loss of principal. The opinions and investment recommendations expressed in the column are the author’s own. TBR News Media does not endorse any specific investment advice and urges investors to consult with their financial advisor. 

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Photo from Wikimedia Commons

Mailbox fishing and check washing, two pernicious crime phenomena, are on the rise.

The United States Postal Inspection Service defines check washing as a scam involving “changing the payee names and often the dollar amounts on checks and fraudulently depositing them.” Often, thieves steal the checks from mailboxes, removing the ink using commonplace chemical agents.

Chelsea Binns, assistant professor at John Jay College of Criminal Justice in New York City, described check washing as an “old school fraud” that is ascending in popularity.

“It is actually the second most common form of consumer fraud right now,” trailing only identity theft, she told TBR News Media in a phone interview.

Carrying out mail theft is relatively simple, Binns noted. Mailbox fishers commonly send a “line” into a post box, often with a sticky end.

“Similar to catching a fish, they’re using these devices and techniques to catch the check out of the mail,” she said.

After stealing the check, criminals can use commonplace chemical agents, such as nail polish remover, to “wash” the stolen checks, removing and changing the payee and amount to suit their preferences. Fraudsters can either cash the check themselves or sell it online in the underground market.

While check fraud is a longstanding practice, the crime has spiked following the COVID-19 pandemic. A February report by the Financial Crimes Enforcement Network indicates mail theft complaints rose 161% between March 2020 and February 2021 compared to the same period over the previous year.

While there have been cases of U.S. postal service employees committing fraud, the report suggested the rise has been driven by non-USPS employees — ranging from rogue individuals to organized criminal operations — carrying out mail thefts.

David Shapiro, a distinguished lecturer at John Jay College, is a fraud risk and financial crimes specialist. Reached by phone, he detailed why these crimes are multiplying regionally and nationally, noting the relative ease with which one can become a check fraudster.

“It’s a low-tech fraud, so it makes it available to so many people,” he said. “Granted, it can get higher tech when you want to expand the network and make it more profitable for organized criminals … but you can enter this business basically as a solo practitioner.”

Compounding this problem is the crime’s profitability, which he indicates has increased considerably due to broader financial trends.

“The number of checks in circulation is way down, but the average value of the checks is way up,” he said. “Now you’re fishing, but you’re not fishing for minnows. You’re fishing for flounders, making it more appealing to the low-tech street thief.”

While much of the national discourse around these crimes centers around security breaches within the postal delivery system, Shapiro regarded the problem primarily as a payment system problem.

“It’s being driven by the banks because the banks are ultimately liable for this kind of thing,” he said. “The customer is not out [of pocket], generally. The fraudster gets away, so basically it’s a bank liability.”

Given the scale and reach of the crime, these losses can compound astronomically. Earlier this year, Randy Hutchinson, president and CEO of the Better Business Bureau of the Mid-South, reported that check washing now accounts for more than $815 million per year in losses to individuals, businesses and financial institutions.

In the face of these challenges, there are tangible ways to protect oneself from mailbox fishing and check washing. Binns advises using a black-ink gel pen when writing out checks.

“That sinks into the check’s fibers, and it can’t be washed,” she said.

The assistant professor also advised against using one’s residential mailbox for check deliveries, and recommended mail with issued checks be taken directly to the post office and handed to a postal worker. She said mailboxes, even those placed outside the post office, are at risk of fishing.

She lastly advised consumers, particularly elders, to explore transitioning to online payment systems, removing the risks associated with paper checks altogether.

“Unfortunately, it’s time for us to change our habits to try to combat this,” Binns concluded.

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Pixabay photo

By Michael Christodoulou

Most investors are aware of the different types of stocks: big-company, small-company, technology, international and so on. And it may be a good idea to own a mix of these stocks as part of your overall investment portfolio. But the importance of diversification applies to bonds, too — so, how should you go about achieving it?

To begin with, individual bonds fall into three main types: municipal, corporate and government. Within these categories, you’ll find differences in the bonds being issued. For example, government bonds include conventional, fixed-rate Treasury bonds as well as inflation-protected ones, along with bonds issued by government agencies, such as the Federal National Mortgage Association (or Fannie Mae). Corporate bonds are differentiated from each other by several factors, but one important one is the interest rate they pay, which is largely determined by the credit quality of the issuer. (The higher the rating grade — AAA, AA and so on — the lower the interest rate; higher-rated bonds pose less risk to investors and therefore pay less interest.)

Municipal bonds, too, are far from uniform. These bonds are issued by state and local governments to build or improve infrastructure, such as airports, highways, hospitals and schools. Generally, municipal bonds are exempt from federal tax and often state and local taxes, too. However, because of this tax benefit, municipal bonds typically pay lower interest rates than many corporate bonds.

How can you use various types of bonds to build a diversified bond portfolio? One method is to invest in mutual funds that invest primarily in bonds. By owning a mix of corporate, government and municipal bond funds, you can gain exposure to much of the bond world. Be aware, though, that bond funds, like bonds themselves, vary widely in some respects. To illustrate: Some investors may choose a low-risk, low return approach by investing in a bond fund that only owns Treasury securities, while other investors might strive for higher returns — and accept greater risk — by investing in a higher-yield, but riskier bond fund.

But you can also diversify your bond holdings by owning a group of individual bonds with different maturities: short-, intermediate- and long-term. This type of diversification can help protect you against the effects of interest-rate movements, which are a driving force behind the value of your bonds — that is, the amount you could sell them for if you chose to sell them before they matured. When market interest rates rise, the price of your existing, lower-paying bonds will fall, and when rates drop, your bonds will be worth more.

But by building a “ladder” of bonds with varying maturities, you can take advantage of different interest-rate environments. When market rates are rising, you can reinvest your maturing, shorter-term bonds at the new, higher rates. And when market rates are low, you’ll still have your longer-term bonds working for you. (Generally, though not always, longer-term bonds pay higher rates than shorter-term ones.)

A bond ladder should be consistent with your investment objectives, risk tolerance and financial circumstances. But if it’s appropriate for your needs, it could be a valuable tool in diversifying your bond holdings. And while diversification — in either stocks or bonds — can’t always guarantee success or avoid losses, it remains a core principle of successful investing.

Michael Christodoulou, ChFC®, AAMS®, CRPC®, CRPS® is a Financial Advisor for Edward Jones in Stony Brook. Member SIPC.

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Photo from Pixabay
By Aidan Johnson

With ongoing concerns about young adults leaving Long Island, other age demographics may be looking for the escape hatch.

Adults aged 60 and over, who account for roughly 20% of Suffolk County’s population according to a 2022 report from the Suffolk County Office for the Aging, have been feeling the impact of Long Island’s high prices as well.

Eric Stutz, a real estate broker based out of Baldwin who specializes in seniors and estates, said he sees Long Island as below average in being a senior-friendly place.

“I see a lot of my clients are heading to the Southeast, between North Carolina, Tennessee, Florida,” he said in a phone interview. “That seems to be the majority.”

Recently, a pair of Stutz’s clients had to choose between staying on Long Island with two of their children or moving to North Carolina, where their daughter lived.

“It was a tough decision, it took a couple of years,” Stutz said. “But their main reason for moving to North Carolina … was the cost of living on Long Island.”

JoAnn Kullack, the chair of Long Island’s chapter of the Retired Public Employees Association, sees many other senior citizens having to choose between living on Long Island or finding somewhere more affordable.

“Most seniors that I know do complain about the cost of living,” she said.

‘Most seniors that I know do complain about the cost of living.’

— JoAnn Kullack

Kullack believes that one of the big draws of staying on the Island for seniors is the abundance of medical care. Big university hospitals, such as Stony Brook, and the closeness of Manhattan hospitals and specialists offer valid incentives for seniors to want to stay.

“A lot of people that I know want to stay here on Long Island,” due to access to premium health care services, Kullack said. “They don’t wish to leave.” 

Kullack suggested lowering the utility rates could offer much-needed relief to Long Island’s senior citizens. While some programs are available that can assist, she added the qualifications are often unrealistic.

“A lot of people don’t qualify,” the RPEA chair said. “If you have two people in the household, you have to be [only earning] $30,000. How can you live here on that?” 

 “You’re taking into consideration paying taxes, paying for utilities, and even if you have no mortgage on your home, you still have to have enough money for food,” she added.

Town of Brookhaven Councilwoman Jane Bonner (R-Rocky Point) views Long Island as a challenging place to live, especially for those who do not make a lot of money.

“We need to address the high tax rate on Long Island,” she said in a phone interview. “We need to do a better job of taking care of our seniors and veterans. So many of our seniors are house rich and cash poor.”

Long Island can also be tough to navigate for seniors who cannot drive, as there is a lack of adequate public transportation.

“I know myself and my husband do a fair amount of taking our moms to doctor appointments and shopping,” Bonner said, adding, “Transportation services are cut when budgets are tight — bus routes are removed.” 

Brookhaven does have programs aimed at helping seniors who may have trouble with transportation, Bonner explained. Still, the town does seek to assist its aging population where it can. 

“We have our senior clubs, our senior transportation, nutrition at our senior centers and Meals on Wheels. We do our part.”

Bonner added that she wants to see seniors be able to “age in place,” where they want to be, instead of being pushed out.

“That’s what we need because if we can provide resources for our seniors to age in a place where they are most comfortable — in their home. It is more affordable that way than building large-scale senior complexes,” the councilwoman said.

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