Monuments don't pay dividends

Nate Crosby |

RMDs. It’s that time of year again.

If they have not done so already, IRA owners who have attained age 72 (excluding Roth IRA) must take a required minimum distribution (RMD) from their IRA, SEP, or SIMPLE IRA. Your advisor or custodian can provide the calculations, based on the 2021 December 31st account total. The penalty for failing to take an RMD withdrawal is 50% of what the IRA owner was required to take out. If you are unsure if you have to take the required minimum distribution for 2022, contact our office for assistance at 419.496.0770 or email

We often have situations where an IRA owner is required to take a distribution but does not need the money from the withdrawal to meet his/her lifestyle. Here are a few ideas if that describes you:

  • Contribute to a Roth IRA for a minor grandchild. As long as the child has earned income you can make a Roth IRA contribution on your grandchild’s behalf, thus creating tax-free money for that child in the future. Earned income includes babysitting money, a paper route, and other common jobs performed by minors that typically don’t earn enough money annually to be required to file a tax return.
  • Use RMDs to purchase a life insurance policy. Whether you use a single premium or a limited-pay life insurance policy, using RMD distributions is a powerful way to turn taxable pennies into tax-free dollars that bypass probate court. If you are not yet thinking of your legacy, a cash-value life insurance policy is still a great way to ensure tax-deferred growth of the cash with no future RMD requirement.
  • If you don’t have a burning desire to do anything with your RMD money, but aren’t thrilled with the interest rate in your bank account, consider depositing the money in a non-qualified investment account. Think of the non-qualified account as the wrapper. What the money does inside the non-qualified account is up to you. Earn over 3% in a money market fund or purchase your favorite stocks, precious metals, or real estate. Best of all, the account has no RMDs and no surrender charge period.

Heightened Security

If you have stopped in our office for a review meeting or service within the past few weeks, you have undoubtedly noticed the heightened security we hired since Halloween. We are proud to have Nick Vogel on our team. He is the first superhero we have employed, and I can tell you he takes his job very seriously. We are all safer because of his service.

Inflation report injects hope into the market. What to take away.

We got a surprise in the inflation rate as measured by the Consumer Price Index (CPI) last week. We saw the largest single monthly decrease in the year-over-year inflation rate since January 2022. To say the stock market reacted positively would be an understatement.

Here is the Bull case: The Federal Reserve has been steadfast in its statement it will raise interest rates until demand decreases and inflation returns to a normal level of 2-3%. In October, the Consumer Price Index dropped from 8.1 to 7.7%. Even though gasoline and food continued to increase in price, there was enough offset in things like natural gas to slow the year-over-year inflation rate. Investors took the surprise reduction in CPI as a sign that interest rates are indeed killing demand and with it a light at the end of the tunnel. The U.S. labor market remains strong and as a whole, publicly traded companies are displaying quarterly earnings that are not as bad as originally feared. While many companies in the Tech Sector have issued hiring freezes or have begun substantial layoffs, we are not seeing that in materials, energy, and manufacturing. If inflation continues to decrease at a significant rate, perhaps the Federal Reserve will be able to pause interest rate increases early in 2023 and we get the “soft” landing in the market that history has proven to be so rare. The remainder of the year has limited financial news; perhaps indeed we have paved the way for a Santa Claus Rally.

And the Bear case: Earlier in the year when inflation rose above 7%, consumers were up in arms. Reaching it on the way back down has a way of making it seem more palatable. We are still a long way away from the Federal Reserve’s target interest rate of 2-3%. Investors have crossed their fingers hoping the Federal Reserve will pivot sooner than expected and pause or eventually lower interest rates seems unlikely at this stage. Meanwhile, Federal Reserve Chairman Powell pointed out that history has taught us there is extreme danger in pausing interest rate increases too early. Allowing inflation to reverse course and run higher again reduces the power of the Federal Reserve to tame it at all. For now, investors should take Jerome Powell for his word. Despite the positive news from October, interest rates will go higher.

As often is the case, we think perhaps there is a middle ground. While 7.7% inflation is still unacceptable, the trend lower is a positive sign, and investors have a reason to be hopeful. Does that mean the market moves straight up from here? The market never moves in a straight line, up or down. Last week we did remove all short positions from our models as we believe risk can now be managed through low-correlated asset classes and stable-fixed income products when necessary to bolster stock portfolios. We will continue to manage risk with eyes on CPI reports in the coming months to tell us if indeed inflation is being tamed. 

Monuments don’t pay dividends

There is an old saying in the investment world, “Monuments don’t pay dividends.” This statement is directed at the fact that growth and innovation too often have a shelf life. When a business owner starts a business and grows it to a successful company over many years, there often comes a time when the ego of the business owner begins to think about a legacy. Their focus shifts from innovation to creating permanence, so they begin to build monuments. We may see this in the investment world when companies stop spending money on research and innovation, and instead spend it on building offices or buying the rights to name a building after their business. AT&T Stadium ring a bell? The Dallas Cowboys play in one of the world’s most awe-inspiring stadiums. When was the last time you thought of AT&T the company as awe-inspiring? “Monuments don’t pay dividends.” I try to take this wisdom with my personal life as well as investing. Life is best experienced in the growth stage. Never stop learning, growing, and investing in yourself. 

Macy's Fall Flavor Punch

Ingredients: 32 ounces cranberry juice, 32 ounces orange juice, 2 liters lemon-lime soda, ice, orange slices, and fresh cranberries


  1. In a punch bowl, add ice, cranberry juice, orange juice, and soda.
  2. Stir to mix.
  3. Garnish with orange slices and fresh cranberries. 

Disclaimer: This newsletter represents the opinions of Crosby Advisory Group, LLC and is not designed to replace individual consultation. Investing involves risk including the potential loss of principal. Consider all risks and fees before investing. Crosby Advisory Group, LLC has ownership interest in CAG Marketing and NMD Insurance.