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July 31, 2017

Dear Clients and Friends,



We hope that you are enjoying the summer. This quarter’s newsletter highlights some trends we see that are impacting personal finance.  


Digital Currency & Assets


Currency is a medium of exchange. Its creation greatly enhanced trade, which formerly relied on barter, the exchange of one good or service for another. Mankind has used different forms of currency over the years. The first coin was thought to be used about 600 BC, the first bank note about 1661 AD, and the first credit card was introduced in 1946. The U.S. dollar dominates world commerce as a medium of exchange. It acts as an unofficial global reserve currency. Other currencies extensively used in world trade include the Euro, the British Pound, Japanese Yen, and the Swiss Franc. These currencies all can be controlled or manipulated to some extent by central banks of the issuing nation. Enter the Bitcoin.


Bitcoins are a form of digital currency (no papers or coins) that operates outside the control of central banks. That means that a government cannot, among other things, freeze a bitcoin account. The bitcoin system employs sophisticated technology to control the number of bitcoins available and the number in each owner’s accounts. 


The era of digitalized assets brings with it ease of use, allowing for the payment of bills, the deposit of checks, the movement of funds between accounts - all by phone or another internet connected device. Cyber security refers to efforts to protect digital assets from theft. There is a tug of war between convenience and protection. The more convenient it is to move digital money, the easier it seems to be for hackers to access it as well. This climate requires extreme vigilance. Users should frequently examine credit card and financial institution statements for unauthorized activity and set up alerts, when possible, for transactions that exceed a certain threshold. 



Extended Lives & Mental Capacity


Many individuals are leading healthier, more active lifestyles for decades after retirement. This requires financial resources to last longer as lifespans increase, an obvious financial planning challenge. However, a new and somewhat unexpected challenge comes from a trend of more retired clients losing some cognitive ability that impacts financial decision making. Individuals experiencing this challenge should have someone they trust in a fiduciary role. A fiduciary is someone placed in a position of trust to look out for the best interests of another person.


At Schiavi + Dattani, we are fiduciaries with regard to the recommendations we make and the actions we take on your behalf. It is, however, important that the client perform an oversight role and partner with us in managing financial resources. If the client loses the ability to perform those duties, then another trusted individual, often a family member, needs to step into that role.   As a result, we recommend that you review the individuals you have selected to be holders of your Durable Power of Attorney, alternative holders of that power and successor trustees of any living trusts. Contact your service advisor here at Schiavi + Dattani and we will discuss your concerns to see if changes should be made in any of these appointed positions of trust.


Digital Estates


We are increasingly moving personal information from papers and books to digital assets. Digital estate planning is the process of making arrangements to properly deal with digital property upon death. This planning should include:

  • Prepare a list of all of your digital devices, such as desktop computers, laptops, tablets, flash or thumb drives, external hard drives, smartphones, etc., and noting how each of these devices can be accessed.
  • Document what data is stored electronically, on a physical device or online.

  • Document all online accounts, including but not limited to: email, social media, shopping, photo and video sharing sites, and online storage.
  • Document any domain names you use or control.
  • Enable your executor to access devices and accounts. Leave instructions as to what information you want destroyed and what information or assets you want survivors to have. This requires having up-to-date logins and passwords accessible to a survivor.
  • Store all of the above information in a safe place. Consider leaving a copy of this information with your appointed Durable Power of Attorney.

We are aware of the following states with S+D clients that have passed legislation to allow fiduciaries access to digital assets: Delaware, Florida, Hawaii, Maryland, New Jersey, New York, North Carolina, South Carolina, and Virginia. Notably, Pennsylvania has yet to pass similar legislation.


The source for the above information was www.everplans.com. To learn more, visit that site.



Employer-Sponsored Health Insurance


If you obtain health insurance coverage through an employer and have the ability to choose between coverage options, you may be tempted by lower-cost plans that limit access to out-of-network providers. Please consider the potential need to utilize a specialist outside of the network and be covered by a plan that includes coverage for that possibility. We are concerned that participants may not be giving this enough thought or consideration and either accepting a limited default plan or the lowest cost option.


Many employers use the Fall as their open enrollment season for benefit elections. If you have any questions, our advisors are on hand to review the options and help you maximize the benefits available to you.



We continue to work daily to earn your trust and confidence.

Best Regards,


Vincent A. Schiavi, CFP®, CPA/ PFS                            Ravi P. Dattani, CFP®, CPA

President                                                                       Vice President



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