Don’t Forget About Estate Planning | Investors Edge

By John Stewart, chief investment officer at Farmers Trust Co.

Week in Review:  Oh My, Omicron!

I’m sure a quick Google search might give me the answer, but I’m curious what they start calling new COVID variants once they run out of Greek letters.

Out of nowhere, news of the Omicron variant, a supposedly highly mutated new COVID strain originating in South Africa, sent the stock market into a sharp tailspin, with the S&P 500 index falling 3% in a matter of a few days. Economically sensitive small company shares and travel stocks felt the brunt of the pain, with some falling 20% or more from their recent highs.

Within a few days, however, most Omicron-related news was turning out to be much better than feared and equity prices began to rebound.

Don’t get caught up in the noise and emotion of headline-related market volatility. DO, however, keep an eye on the weakening trend in corporate earnings estimates, which is likely the real reason markets have become vulnerable to downside pressure. It’s probably a good time to harvest SOME of your hard-fought gains from the past 20 months.

Featured Insight:  Don’t Forget About Estate Planning

Most people spend the majority of their financial planning on matters pertaining to asset accumulation and prudent investment management to accomplish goals such as saving for retirement.

What often gets neglected is planning for the who and how of what happens to your assets in the event of your incapacity or death – otherwise known as estate planning.

While many people may have the goal of having their last check bounce right before they pass away, in reality, if you’ve done a good job with your retirement planning, odds are you’re likely to leave a fair amount of assets to the next generation.

Consulting with an estate planning attorney in conjunction with other trusted advisers on financial matters will allow you to ensure your assets are transferred according to your wishes – like children or preferred charities instead of to the government or some long lost nephew by marriage that you never even met.

Looking Ahead:  More Inflation Data

The Consumer Price Index, or CPI, for November will be released next Friday. This will be a closely watched report after the blazing hot October reading of 6.2%.

This will also be the Fed’s last look at inflation data before their policy meeting the following week. Fed Chair Jerome Powell – yes, Biden decided to renominate Powell to another term as Fed chair if you hadn’t heard – was talking tough on inflation earlier this week, even hinting that the central bank might decide to wind down its asset purchase program at a quicker pace.

Recent market weakness, especially in oil prices, which are down close to 20% in the past month, could give the Fed cover to stay with their go-slow approach to tightening monetary policy.

If they do choose to get more hawkish on fighting inflation, however, expect a few more bumps in the road as we head into 2022.

Copyright 2022 The Business Journal, Youngstown, Ohio.