Letter to Stakeholders, December 2024

Wednesday, December 11, 5:45 pm EST. We are merely days away from the end of year holidays. Are you going to enjoy them? I am. I am going to travel with family to my in-laws, we’re going to be spoiled and I am going to watch “It’s a Wonderful Life(again).” Like you, I don’t know for certain what 2025 will bring but looking back, I never have been certain. Sometimes I have been prepared; professionally, I am required to prepare and look ahead as steward of your portfolios. In conference with Doug and after meeting with many of you during Fall “Check-ins,” we have prepared. We have prepared your portfolios for alternative risk and reward scenarios. You have cash (money markets), debt (bonds and structured notes) and equity (stocks and ETFs). You are in the best position to achieve your goals. Since the election your portfolios have done well. As for what to expect financially under the new administration, well, here’s what we are seeing. 

Scott Bessent   

United States Secretary of the Treasury is one of the more economically significant positions for the next administration to fill. If the President-Elect gets his way, Secretary Janet Yellen will be replaced by former “hedge-fund titan,” Scott Bessent. When your fellow clients ask about what we see in the stock market future, appointments like that of Mr. Bessent do not inspire fear, but rather reinforce our insistence on maintaining a rigorous investment philosophy. Although Mr. Bessent is best known for “breaking” the Bank of England with George Soros – yes, that George Soros – on a billion dollar trade, he’s not always right (actually, none of us are). Subsequent to his successes are stories of investors joining and leaving his funds. A very typical investment history for anyone who manages a hedge fund. Because even billionaires realize “ups and downs” of the markets, we will remain committed to your personalized plan and stay ready. 

Syria, France and South Korea

We have returned to a global environment best described as “never a dull moment.” Syia’s government has “collapsed,” France’s parliament has been shaken and South Korea has had to renounce its declaration of Marshall Law. This is South Korea! Fareed Zakaria’s book, Age of Revolutions that delves into the history of political backlash was a prescient registration gift from the CFP Board’s Connection Conference this year. Even Democracies like Romania are suffering through existential crisis. Global uncertainty typically means a lower stock market. But today the NASDAQ hit a record 20,035. 

Big Credit

Despite the President-Elect’s promise to keep Federal Reserve Bank Chair Jerome Powell, there is still plenty that’s going on in finance (and not just by the politicians). Over the past few years banks have curtailed their lending and so-called “shadow banks” have taken their place. Private or “alternative” (vs. “public” stock market) investing has become popular with advisors; now that popularity includes Morgan Stanley and Citi. Investments in vehicles like private debt/credit, private equity, hedge funds and structured notes are becoming mainstream.  On your behalf we have felt comfortable including structured notes in your portfolio and as we evaluate the benefits of private credit, we notice firms like Apollo (Manager of the Year by Sustainable Finance), and now BlackRock making huge commitments to corporate lending. As a firm, we took our time to study and create trusted relationships before investing into structured notes. We are evaluating and adding strategic partners who will help us to further diversify your portfolios with private credit if and when it makes sense.

Stakeholder Spotlight 

This month our Stakeholder Spotlight shines on Langley Residential Support Services. Doug has served on Langley’s board for over 13 years. You know he is passionate about serving others and that includes adults with developmental disabilities. For over forty years, Langley has served as a lifelong community and home for adults with developmental disabilities in Fairfax County. Langley empowers them to live in a residential setting (or their home) with independence and community.  

Over the past few years, our firm has proudly supported Langley’s mission and community through Doug’s time and sponsored events. If this mission resonates with you take a deeper look at this 90-second (video) and 2-minute video here.

Merry Holidays!

Jason J. Howell, CFP®, CPWA®, CSRIC® 

President

Jason Howell Company is a family wealth management firm that strengthens the finances of families making the transition from first generation success to family wealth. We envision a world where wealthy families give, grow and govern themselves in ways that enrich their local communities. We do this by reducing the fear, isolation and guilt associated with financial success.

Jason J. Howell, CFP®, CPWA®, CSRIC® and Douglas W. Tees, MBA, CFP® CAP®, CBDA  have spent a lot of time in the Washington, DC area, and are aware that many people who are first generation wealth suffer from a kind of "financial imposter syndrome."  Successful entrepreneurs and family businesses are always looking over their shoulder; government contractors worry about the next contract; former Capitol Hill staffers privately wonder if they should "feel bad" for the money they now make. Imposter syndrome is common among people who work for the many corporate headquarters based in this area as well. These feelings get in the way of properly managing family wealth. We empower them to get organized, build a team of advisors and make decisions.

Our typical "first generation wealth" families include dual income parents who work, save and have just the right amount of fun. For long-time, family owned businesses we focus on much family preservation as we do wealth preservation. 

First generation wealth success stories and family business owners realize that they:

• Need to “do something” with the cash in their checking/savings
• Need to eventually diversify their portfolio away from the family business
• Need an investment strategy for “up” and “down” markets
• Need a plan to mitigate market, credit, inflation, and political risks
• Need to start tax planning instead of just tax paying
• Need to be sure they are choosing the right work benefits
• Need to reduce financial miscommunications between family members
• Need to separate business finances from personal finances
• Need to separate family wealth from individual wealth
• Need a plan to provide space for both family and individual philanthropy 
• Need to plan for money while alive and for what happens after death