Category Archives: divorce

Investment & Financial Insights

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Have a seat at our table

KathyWe live in a world where having access to the internet affords everyone an opportunity to be a self-appointed expert on a vast and varied list of topics. A quick online search can provide information as broad and diverse as the best way to remove grass stains, all the way to diagnosing complex medical conditions. While educating yourself is always a wise and recommended endeavor, it’s also important to remember that discernment is key. In other words, there is wisdom in knowing when to ask for help.

Reaching your financial goals and maintaining the assets you’ve worked so hard to attain can be a complex and overwhelming task, even for the most fiscally savvy of individuals. This is why we believe so strongly in a synergistic approach to money management.

The collective and comprehensive experience and training of our financial professionals make us a respected authority on an array of banking and wealth management services. Working together as a team, we offer depth of knowledge and a holistic approach to help you realize your financial objectives. Our staff is comprised of trusted professionals who hold advanced degrees in business, law, and other prestigious credentials. We’ve got all the bases covered. So no matter if your current focus is financial planning, investments, retirement, or tax planning, the team at Stock Yards Bank Wealth Management & Trust will work hard to make your financial dreams come true. ♦


Economic Update| Q3: 2018


markJuly 10, 2018

If there were any good news, would anyone be able to hear it over the hyperbole or read it through the sensationalized headlines on our smartphones?

Thankfully, we did.  During the second quarter of 2018, unemployment in the United States fell to a rate not seen since 1969.  Wage growth accelerated.  Tax reforms boosted personal take-home pay, as well as corporate earnings.  The stock market in the United States rose as the Standard & Poor’s 500 Index delivered a total return of 3.4%.  International stocks as measured by the MSCI EAFE Index declined modestly due to political uncertainty in Europe and the Far East.  Although many fixed income investors experienced negative returns during the second quarter (Bond prices fall as prevailing interest rates rise.), proceeds from maturing bonds could be reinvested in bonds offering more attractive yields.

Cable commentators are very good at creating a sense of uncertainty and fear to keep viewers engaged (and to sell advertisements).  News organizations have plenty of raw material available to construct gripping storylines: rising
interest rates, wealth disparity, volatility in financial markets, turmoil in Washington D.C. and abroad, and tariffs.  Because these variables are beyond our control, they are prone to create anxiety.  Only by delving into the facts can we determine whether or not the worry is warranted.

For example, the subject of tariffs often leads to discussion of a global trade war and its potential consequences.  Should we be worried?  Research firm Strategas helps put this topic in perspective.  It compares the size of the tariffs that have been imposed and merely proposed to the size of new fiscal stimulus including repatriation of cash held abroad by US-based companies and tax cuts resulting from the Tax Cuts and Jobs Act of 2017.  In total, $800 billion of stimulative policy in the United States dwarfs the $120 billion of tariffs and potential tariffs that have been in the news.

Here are some other encouraging facts.  For the first time in a decade, the United States posted three sequential quarters of 2.5%-or-better GDP growth last year.  Consumer confidence and business confidence indicators have strengthened and remain strong.  A decrease in regulatory burden has enabled businesses to increase efficiencies.  Tax reform has helped US companies compete more effectively in the global economy.  Tax cuts have provided companies, both large and small, with the ability to hire and to invest in new property, plant, and equipment.  All of this is good news for economic growth.

Now, if you are beginning to worry that we have turned Pollyannaish, rest assured that we are well-aware of the business cycle.  Although we do not expect to see a recession soon, we recognize that the combination of full-employment and inflation has typically compelled the Federal Reserve to act.  The Fed has been especially careful to share its plans in recent years.  That said, if the Fed tightens monetary policy too aggressively, a recession could follow.  Since the timing and magnitude of an inevitable recession are unknowable, we investors stay the course.

By this we mean that we continue to favor common stocks as the financial asset of choice over fixed income and non-financial assets like collectibles and commodities.  We welcome stock price volatility, which market commentators and business school professors call risk.  In our view, volatility creates opportunity.  While prices can be quite volatile, the value of quality companies is quite stable.  Volatile stock prices enable alert investors to capitalize on asset mispricing.  To quote Benjamin Graham, the father of value investing, “In the short run, the market is a voting machine but in the long run, it is a weighing machine.”  Daily price changes are the result of emotion and speculation.  But, over the long run, fundamentals dictate value.

Most of our clients have a long investment time horizon.  Since this is the case, we have the long run in mind and are able to focus on the fundamentals that can create the most value for our clients over time.  We concentrate our efforts on constructing portfolios of high quality, shareholder-friendly, growing companies that are trading at reasonable relative valuations.  We prefer moated businesses with inside ownership, proven management, and unique business models that insulate them from competition.  We also prefer conservatively financed businesses with low levels of debt, strong cash flow from operations, and high returns on capital.  We expect that companies with these characteristics will do well in the current economic environment and, more importantly, during difficult economic times.  When the inevitable recession or stock market correction occurs, the high quality, well-capitalized companies that we own will protect our clients from permanent loss of capital.  We use this perspective in our investment process to minimize mistakes that could result from reacting to BREAKING NEWS ALERTS.  Professional investment discipline is one of the most valuable things we can provide to our clients.

Thank you for the confidence you have placed in our Wealth Management & Trust team at Stock Yards Bank & Trust.  Please contact us directly by phone or by email at any time to discuss our outlook or to review your portfolio in light of your objectives.♦

Retirement, Social Security and Divorce

marc.JPGWhether you expect social security benefits to account for a substantial portion of your retirement income or to supplement other sources, everyone has a similar objective of receiving the maximum benefit possible.  It is widely known that married couples have several strategies to consider, however, divorced individuals have some options as well.  Divorce after 50, otherwise known as Gray Divorce, is on the rise and recent changes to the tax code have removed the taxation and deductibility of alimony* paving the way for social security to become a more prevalent income consideration for couples divorcing at older ages.  Understanding claiming strategies for divorced couples may be more important than ever.

In order to claim benefits on your ex-spouse’s record you must have been married at least 10 years and divorced at least 2.  Your ex-spouse must be entitled to receive social security or disability benefits based on his or her work history, however, he or she does not have to be retired or currently claiming.  This differs from married couples where the spouse upon whose record the benefit is being claimed must also file for benefits.  The ex-spouse can be remarried and is not alerted of anyone claiming based on his or her record.  In fact, multiple ex-spouses can claim on the same worker’s record!

If you wish to claim on an ex-spouse’s record, you cannot be currently remarried.  Additionally, the spousal benefit must be more than what you would receive based on your own record.   Although you may file as an ex-spouse you are deemed to have filed for your own benefit as well.  Social Security will give you the highest benefit available (the spousal benefit is typically ½ of the higher wage earners benefit).

The earliest an individual can file for a social security retirement benefit is age 62 (unless your ex-spouse is deceased and you qualify to file for a survivors benefit).  Filing at age 62 permanently reduces your benefit whether you claim on your own record, your spouse’s, or your ex-spouse’s.   By claiming early you lose the opportunity for delayed retirement credits and growth of your benefit (there is no impact on the ex-spouse’s own benefit).  An exception to this rule applies to those born before 1954.  These individuals have the option to file for a benefit based on their spouse’s (or ex-spouse’s) work history and then claim his or her own at a later date if higher.

Exceptions also apply in the case of survivors.  A divorced individual (meeting all of the criteria explained above) can claim his or her own benefit if initially it is greater than the spousal benefit, then step-up to a survivors benefit upon the death of the ex-spouse.  Ex-spouses, widows, and widowers can continue a survivor benefit if they remarry after age 60.

There are many factors to consider in claiming social security whether you are single, married, divorced, or widowed.  How to claim becomes equally important as when to claim.  Your team of advisors at Stock Yards Bank is here to aid you in making these decisions as you move through your various phases in life. ♦

*For divorce agreements entered into after December 31, 2018.


Wealth Management & Trust

KATHY THOMPSON, Senior Executive Vice President, (502) 625-2291
E. GORDON MAYNARD, Managing Director of Trust, (502) 625-0814
MARK HOLLOWAY, Chief Investment Officer, (502) 625-9124
SHANNON BUDNICK, Managing Director of Investment Advisors, (502) 625-2513
PAUL STROPKAY, Chief Investment Strategist, (502) 625-0385
REBECCA HOWARD, Managing Director of Wealth Advisors, (502) 625-0855


We provide the information in this newsletter for general guidance only. It does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, investment, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. The information is provided “as is,” with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, expressed or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.


Suddenly Single: Planning to Go It Alone

Untitled-logo trustMost of us cannot imagine the sudden loss of our spouse. Yet, difficult as it may seem to accept, U.S. Census data indicates that the overwhelming majority of married women will be on their own for a significant number of their later years. Should this happen to you, you might be thrust into economic self-survival at a time when you may feel particularly vulnerable and least able to cope. Nevertheless, serious decisions would have to be made, often having a lasting impact on your future financial well- being.

Planning for the Unimaginable

There is an unpredictable aspect of “sudden loss” in that we never quite know how we will react to certain events until they actually occur. While no one can ever be totally prepared to deal with personal trauma compounded by legal and financial matters, there are steps you can take to help you navigate through this difficult period.

The key is to find a way to help provide structure in your life at a time when structure may be disintegrating.

It Happened. . .What Do I Do?

When the initial shockwaves hit, there are matters that will require immediate attention: notification of family and friends; funeral arrangements; and contacting an attorney to review the will and handle the legal aspects of your spouse’s estate. Let your closest friends and most trusted advisors help you with some of these details and short-term decision-making, but proceed with caution regarding major financial decisions such as whether to sell your home, borrow or lend money, invest, make major purchases, and make work/career changes.

During this period, you will most likely face competing demands on your financial resources. If your spouse was the primary income earner, it may take some time to assess your financial situation. During the first few months, pay bills that need to be paid, but spend cautiously, paying attention to cash flow and liquidity.

Rebuilding After the Shockwaves

Certain timetables (e.g., timely filing of tax returns) can’t be overlooked, but much of the financial recovery process should be orchestrated to match your emotional recovery. Some of the important aspects that will have to be addressed eventually will include assessing the needs of dependent children; making housing decisions; determining your income needs; making decisions about insurance settlements; evaluating your insurance needs; and managing money on your own.

Many of these decisions may flow naturally from an appraisal of your needs (and/or desires) to participate in the workforce. Will you want to work? Will economic necessity dictate that you must work? If you are currently employed, will you stay in the same position? If you have not worked for some years, how well will your skills fit the job market? Will you need to acquire more education or enhance your technical skills?

While professional advice will be helpful, don’t allow yourself to be pressured in areas in which you need more time. Your goal should be to develop a sense of command and control concerning your financial future. Align yourself with advisors who will have the patience to work with you at your pace, advisors who will help you gain the knowledge and confidence necessary to go it alone.

Obviously, the earlier you begin to educate yourself concerning financial matters, the better prepared you will be to withstand the impact of facing sudden loss. The quality of your life may depend on your financial skills and your willingness to take responsibility for managing your own financial affairs.

If you have questions about the financial implications of divorce, email our Certified Divorce Financial Analyst,, for help!

Resource information provided by Financial Media Exchange.




Remarriage: Altering Your Financial Plan to Meet Your Needs

Untitled-logo trustIn previous generations, husband’s traditionally handled the family finances. While this arrangement may have worked well during the husband’s lifetime, the consequences of the wife’s lack of involvement in the family’s finances often became clear after her spouse died. Today, more women are actively directing the outcome of their personal finances, and for good reason.

Women need to plan for a time when they may be on their own. Through divorce, widowhood, or personal choice, the odds are high that a woman will be independent at some point in her lifetime. Financial planning is essential for women throughout life, but it becomes especially important in the event of remarriage, as financial arrangements may need to be made for ex-spouses and children.

If you are in a second marriage or about to remarry, you may want to consider the following important points about managing your personal finances:

Bank Accounts. Should married couples combine their bank accounts or keep them separate? Or, perhaps combine certain accounts and keep others separate? There is no right or wrong choice—this is a personal decision. An open and honest discussion may reveal whether or not you and your spouse are financially compatible regarding spending habits, saving, investing, debt, etc. If there is a marked difference in the way you both handle money, then separating your finances may be a better plan.

Prior Debt. Will each spouse be responsible for the other’s prior debt, and if so, to what extent? Keeping the indebted spouse’s prior debt separate may help ensure that the other spouse’s property remains out of reach from creditors.

Property Acquired before Remarriage. Owning previously acquired property in your own name can prevent the risk of losing personal property to your spouse’s potential creditors. Also, doing so may have estate tax benefits. Keeping your property in your own name can help to minimize estate taxes while providing an inheritance for children from a previous marriage.

Home Ownership. Many married couples choose to title property jointly as tenants by entirety. When one spouse dies, the home passes to the surviving spouse tax-free. However, there may be estate tax consequences when the surviving spouse dies. Be sure to consult with a qualified tax professional beforehand.

Retirement. Saving for retirement is one of the major financial goals for married couples. Women, in particular, have unique concerns when planning for retirement. First, women typically live longer than men, so their retirement income needs to last longer. In addition, women often spend more time out of the workforce than men as a result of caregiving responsibilities, and therefore are less likely to have pensions and full Social Security benefits. According to the U.S. Department of Labor in 2013, when women work, they typically earn 82 cents for every dollar earned by their male counterparts. Consequently, the gap between gender incomes makes it especially important for women to prepare for retirement.

Insurance. Disability income insurance can help replace a portion of your income in the event you are unable to work due to sustaining an injury or illness. This type of insurance provides funds that can be used for bills and expenses. Similarly, life insurance provides a death benefit that can be used by your family. Proceeds can help ensure that children from a prior or current marriage can attend college, the mortgage can be paid, and the surviving spouse has some replacement income.

Estate Planning. It is important for blended families to plan for the final disposition of assets. Trusts can be a valuable tool to minimize estate taxes and to help ensure that your assets are distributed to heirs according to your wishes. For example, at your death, your assets can pass to a trust, from which your surviving spouse will receive income without direct access to the assets. At the death of the surviving spouse, the assets can then pass to children from your current or previous marriage. This provides ongoing income for your surviving spouse and an inheritance for your children, as well. In addition, if the surviving spouse later remarries, the trust can be designed to preclude your assets from their marital or community property.

Every woman who remarries needs to balance her financial past with her financial future. By addressing the management of your personal finances as soon as possible, you can avoid disputes and build financial independence for your extended and blended families.

If you have questions about the financial implications of divorce, email our Certified Divorce Financial Analyst,, for help!