(New York)

Annuities are a widely available and popular product, and they are heavily utilized by retirees whose main focus is income. Therefore, it would make sense that tax planning around that income would be more of a major consideration—especially because annuities have some peculiarities as it regards taxation—but in general it does not seem to be an explicit topic. One of the first things to remember is the difference between qualified and nonqualified annuities—the former being in retirement plans, the latter not. Both require mandatory withdrawals after age 72. It is critical to remember that only interest, not principal is taxable when withdrawing money from a nonqualified plan. This is a big danger zone that some retirees fall into. Two other important notes: annuity interest used to fund long-term care insurance can be used tax free; and spouses can assume ownership of an annuity in the event of the death of their spouse tax-free.

FINSUM: For advisors who readily deal in annuities, this info will be second nature. However, there are a lot of advisors who are just starting to get into annuities and this info will be quite useful.

(Houston)

Unprecedented freezing temperatures across the south have wrangled most news headlines this week. This is causing a not so surprising collapse in production from the major U.S. manufacturers in the state most affected, Texas. But the lack of demand from refineries is creating a negative pull on oil prices as they are slower to adjust to changing conditions. Sluggish oil prices will be expected to continue despite a 3.5 million barrel shortfall in production because the refineries aren’t in high demand. On top of this demand shortfall, OPEC has announced plans to ramp up production. These combining factors have produced about a 2% decline in WTI crude futures after declining 1% in trading last Thursday. Finally, the Biden administration has set the course to re-engage with the 2015 Iran nuclear agreement, however, Trump-era oil sanctions have not been reversed.

FINSUM: The run-up in oil prices over the last two weeks was driven by inclement weather in the U.S. but look to the finer details of global production in the next couple of weeks to push oil prices back down. Examine related sectors, like the airline industry, to capitalize on these fluctuations.

January and early February offered some rough times for investors. The two-week meme stock debacle had most investors’ hearts skip a beat...view the full story on our partner Magnifi's site

Two junk bond indices, Bloomberg Barclays U.S. Corporate High Yield Index and ICE BofA US High Index Yield, hit record lows both dipping to about 4%...view the full story on our partner Magnifi's site

(Chicago)

Municipal bond market returns remain low, but nonetheless investors seem willing to keep demanding low yield munis. This rise in demand...view the full story on our partner Magnifi's site.