Webinar: Financial wellness for Intel employees

Learn how to manage money during uncertain times.

Tags: Home buying, Mortgage, COVID-19
Published: July 01, 2020

During this webinar replay, Jill Enabnit, Senior Vice President, Deposit Product Manager, U.S. Bank, and Karen Wimbish, Head of Investment Product and Financial Planning at U.S. Bancorp Investments, discuss:

  • How we’re here to support you when you need us
  • Support through the Coronavirus Aid, Relief and Economic Security (CARES) Act
  • Financial considerations in the current environment

View video transcript


Intel: Financial Wellness

JILL ENABNIT: Thanks, Courtney, and good afternoon, everyone. We appreciate you joining us today. My name is Jill Enabnit, and I lead our Deposit Product Management area here at US Bank. On the phone with me is Karen. And I'm going to hand it over to her to introduce herself also.

KAREN WIMBISH: Thanks, Jill. And I'm Karen Wimbish, and I'm head of Investment Products and Financial Planning at US Bank for Investment. And Jill and I are delighted to be here with you this afternoon. And we're going to cover quite a number of things, but there were some questions that were submitted, and we'll try to get to as many of these topics as we can in today's presentation.

And there were things like how do I go about finding an advisor and what are our opinions on the stock markets, what should I do with a 401(k), how many weeks stash do we recommend that an emergency fund should cover, and mortgage incentives that are part of Workplace Banking. So now, let's get started. And I'm going to turn it back over to Jill.

JILL ENABNIT: Thanks, Karen. So I'm going to spend some time talking about your everyday banking needs. And we recognize that these are unprecedented times, and want to ensure that you are aware and taking advantage of all the options available to support your individual banking needs and help you achieve your financial wellness, while also realizing your goals in any environment. So attending financial seminars such as the one today is a great way to educate yourself. It helps you learn about the tools and all the support functions that are available for you. So our hope is that, today, you walk away with a few action items that help you gain, or maintain, good financial habits now and in the long term.

So to start, when you want assistance with your accounts or are unsure of what to do next, your bank is there for you. So make sure you contact them. We recognize that the financial impacts from COVID and the current environment are individualized, and therefore you may have to use customized solutions. So your bank, US Bank specifically, may have customized solutions to fit you or your loved ones' needs.

So I'm going to give you some examples that US Bank has provided. So we've done things like temporary reduced APRs on new US Bank personal loans. We've reduced pricing on US Bank simple loans. We removed the savings withdrawal limits and suspended any fees related to excess savings withdrawals. All things that can help, depending on what your needs are.

So additionally, we can provide resources to help you understand your options during things like medical hardship, adjusting to the loss of a job, avoiding predatory scammers, and more. So just leverage what's available. So you could visit, in our case, the dedicated website, which is usbank.com/covid-19. And that'll help you stay up-to-date with how we're responding, and potentially give you other additional resources that might help.

So if you have a question, ask. We want to help. So in a branch, you can find one through our dot.com locations to find your local branch operations, our customer relationship consultants or bankers are prepared to help you with your individual questions and needs. They can also help connect you with experts from around the bank that could be from mortgage help to wealth management, which Karen's going to talk about in more detail, to understanding financial options that you might have if you have a small business, or maybe you have a side gig.

So leverage those available financial education resources so you can focus on achieving your goals. In some instances, you might have the option to use things like co-browse or screen share services that can connect you with a banker. That allows our bankers to view your screen along with you so you can kind of provide that real-time assistance or troubleshoot any issues.

So leverage the resources that are available. Ask your questions when you don't know the answers and want additional help. That's what your bank is there for. So a second area to ensure you're educating yourself and your family is around potential financial scams. So while you need to be aware and prepared for scammers 365 days a year, unfortunately, the current environment has brought out additional scams. So scammers and cyber criminals may try to take advantage of your concerns related to civil unrest or COVID-19. So they may do things like offer you fake products, they may give you medical advice that's not correct, they may create fake charities or try to compel you to click on fraudulent links to gain access to your device.

Be aware of the risks. So educate yourself on the types of scams to watch out for. If you have vulnerable loved ones-- it could be your children, elderly parents, or others-- be aware of this scam risks, and discuss those risks so that you have also a chance to educate them, and also be aware of their financial activities so that you can watch out for them.

So additionally, our COVID-19 page has additional information on scams specific to the COVID environment and what to watch for. There are also other resources out there that you can help stay up on what scams are out there on an annual basis. So for additional information, you can visit the Federal Trade Commission, or usbank.com has an Online Security page, where that is kept up-to-date with the types of scams and some of the things that you can do to help protect yourself.

So now you have ways to access the resources when you have a question, you can protect yourself from financial scams. Next, what you want to do is ensure that you have control and use the tools available to make your financial life work on a day-to-day basis. So the COVID environment has shown that convenience of digital options to support your banking needs from anywhere, it can reduce your stress and it can ensure that you stay on track to your financial goals.

So what are some ways you can do that? There are many tools and financial education sources available. I'm going to talk about three specific categories for you to address that look at your everyday financial needs and support some of your longer-term financial goals. So first, ensure that your everyday banking needs are covered and uninterrupted.

So through a number of digital banking options, you can do almost anything, virtually conduct almost everything you need to do from an everyday financial transactions online or through your mobile device. So while digital is always convenient, this is especially important when you think about the current environment. Whether you're working from home, you might have schedule changes or concerns with social distancing, virtual banking options will keep you on the right financial path.

So ways to do that. Use the mobile app, online banking, or a voice assistant, such as Alexa or Google Home, to complete your banking activities. Some things you want to make sure that you're really thinking about. Stay current and pay your bills through a bill pay functionality. So US Bank Bill Pay, or whatever your bank might have available. It supports social distancing and helps ensure that you don't miss a date. So if you're like me, lately sometimes I don't even know what day it is. It seems like they all run into one another. So having that bill pay functionality ensures that you're staying on track.

Another option is, if you have to send money to friends or family, use a functionality like Zelle. Or maybe you have a side gig. Consider having that be the way you have your customers pay you. Zelle's a great option to let you reduce your need to take checks or cash and support social distancing at the same time.

So a third way is to look at how you deposit your checks. So deposit your checks from the convenience of your home through Mobile Check Deposit. So while you'll see some branches are beginning to return to broader business hours, Mobile Check Deposit is a very convenient way for you to bank anytime on your terms and ensure that you have timely access to any funds that you might be receiving through checks.

So leveraging digital banking also helps with your financial health. So protect yourself and stay on track to financial goals by regularly monitoring your account activity. So what does that mean? You can do things like set up text or email alerts that help you track your balance and know when key activity occurs in your financial life. So being aware of the activity in your account provides you knowledge to build good financial habits, and is also another way to help protect yourself from scams. If you're aware and know what's going through your account, you'll recognize early on if you have been a victim or had some scam occur.

So you can use the tools within US Bank mobile app to keep track of your spending and savings opportunities through personalized insights also. So how do you do that? You can use budgeting insights that let you understand your spending habits, in total and across some categories. So it provides regular insight into how you spend in areas like shopping and dining out, travel. Plus, you can see how that works over time. So you can work to make small reductions in some of those discretionary spend categories that help you towards the second category of digital banking strategy, which is what can you do to save.

So take advantage of ideas and tools that can help you save more. Even if it's in small amounts, it can add up over time and help you save toward your financial goals. So what could that be? That can be everything from regular automated transfers to savings accounts, which is likely the largest place you're going to end up saving in bigger chunks, but then use those things on the margin. Use things like micro savings tools that look at your cash flows and give you ideas of where you might have had small amounts throughout the month that you could have saved a little bit more.

You can also do things like small transfers that are linked to how you use your debit or your credit card. So think of it as every time you swipe your card, you transfer 25 cents from your checking account to your savings account. You could set that up as an automated process. So you can set yourself up overall for saving success by using those automated tools, and use them in combination so that you're getting to the point where you're getting to goals for savings over time.

So if you're worried about overdrafting, then you should link your savings account to your checking account for overdraft protection. So at US Bank, we never charge a fee for you to use your own money. So you can use an advance from your savings account to cover an overdraft in your checking account if needed.

So the third key area is to use digital tools to support your financial goals is understand your credit health. So knowing your credit score and the impacts your financial habits and actions have on your score is extremely important. So all US Bank digital customers have access to a free credit view dashboard, and it also has a simulator tool attached to it that allows you to navigate your credit health. It allows you to think about simulations and ways you use credit, and what that means for your score. So whether you currently use credit or plan to borrow in the future, using this no cost tool today to understand your credit score will make you a smarter borrower for tomorrow.

So whether it's building good financial habits, moving money, depositing checks, or having an awareness of your overall financial health, all of that can be accomplished simply and securely from your home, or anywhere, by leveraging all those virtual tools. So if you don't already have it, you can download the US Bank mobile app, or you can text get app to 872-265, or visit your app store for the mobile device that you have.

So those are some tools that can help you stay on the right financial track. During COVID relief, we've also had some unique things or specific things tied to needs that people may have during this time. So to provide support to customers financially impacted during the COVID crisis, we've done things like ensure that customers have timely access to their stimulus checks.

So this included increasing mobile deposit check limits and removing restrictions to allow you to deposit a government check through mobile. So if you have a stimulus check that is in paper form and you haven't put it into your account yet because you don't want to go to a branch or you're social distancing, go ahead and use Mobile Check Deposit to do that.

Additionally, we want to help customers with options on their mortgage if they're financially stressed. We want to provide options for customers that may need access to IRA or retirement accounts to help cash flow need. And finally, we're helping businesses through Paycheck Protection Program. So if you are someone who has a side gig or a small business, think about how you might potentially use or leverage Paycheck Protection Program, if it's appropriate. At this point, US Bank has done paycheck protection loans that have helped businesses that have over 800,000 employees. So it's a great resource also.

Finally, as an Intel employee, Intel has a US Bank Workplace Banking program association with us. So you can always participate in that program, in addition to anything tied into the COVID-19-related benefit. So this is our way to say thank you to you, and also a reminder that you have specific benefits with us, such as this webinar and other financial education seminars. So take advantage of it. You can use the digital resources available to help you manage your money, save time with mobile and online banking, and use those savings tools and the credit health score simulator that I talked about earlier.

Additionally, leverage it to open a door to a new home. So talk to a banker, and you can learn more about the Workplace Banking perks that you have, which includes a credit towards mortgage closing costs. Additionally, you have access to our Financial IQ. So this seminar, and other, more detailed information on topics such as protecting yourself from scams and planning for the purchase of a home are available on that Financial IQ site. You can visit usbank.com/workplace for additional information and special benefits and the specific information tied into being an Intel employee.

So lastly, when you think about your everyday banking needs, make sure that, if you have a question that hasn't been covered today, ask about it. We want to help you. You can visit our website for branch locations or you can visit one of the branches on the screen. These are the branches that are located near Intel corporate site. So as you're coming back into the office, you have that opportunity.

So now that you have a stronger set of tools to help you with your everyday banking and financial needs, I'm going to turn it over to Karen, who's going to talk about some smart financial moves to help you consider during this challenging time.

KAREN WIMBISH: Great. Thanks, Jill. I don't think it's an understatement to say there's been a lot going on in the market since the beginning of the year, and most of that due to the uncertainty around COVID-19. And in this time of uncertainty, it's our goal at US Bancorp Investments to provide you with relevant insights and guidance in a timely manner. So during our time today, I'm going to spend a few minutes reviewing what's currently happening in the market. It's almost hour by hour right now. And then we're going to go through some smart financial moves that you might want to consider during these really complicated times that we're in.

So let's start by reviewing what's happening in the markets as of this week. And I'll go through the major market sectors, and I'm going to give you both a global view and then our thinking around those particular sectors.

So let's start with the global economy. Quick take on this is the stock market rose sharply last week, and it fell very sharply this week. But last week was aided by an unexpected solid jobs report that bolstered the expectations of a quicker than anticipated economic recovery. And our view was that the jobs report was a clear sign, yes, that the US economy has begun to recover.

We're likely to see sharp improvements in data over the coming months, rebounding it was really a historically weak April. But even so, we're going to be in this, quote, muddle-through recovery, in which there'll be some clarity, but the economic path is going to continue to remain uncertain for a period of time. And that's what our expectations are. We still believe that recovery back to 2019 growth trends is really unlikely this year.

So let's look at the equity markets. It's been like a roller coaster. Stocks were rallying last week, as there were indications of economic improvement emerging, even though the duration and impact of COVID-19 remains unknown and the path toward normalcy is subject to much uncertainty. So while the S&P 500 closed last Friday, June 5th, at 3,193, which was a whopping 43.7% above the March 23rd low of 2,237 and 6% shy of the February 19th all-time high of 3,386, this week has seen a significant decline, and there continues to be lingering concern around COVID-19, as the S&P was down to 3,002 at close today, which was down 188 points.

With regard to the bond market, just a quick overview. The strong jobs report did boost long-term treasury yields, meaning that the prices of treasuries did fall, as compared to corporate bonds, particularly for riskier assets. So in our view, we recommend a tilt toward high-quality assets. Companies have ample access to new debt capital, which can help them bridge these short-term shortfalls in operating cash flow, and corporate bond yields are still higher than historical norms compared to treasuries. The Fed remains focused on implementing existing programs announced in recent months for now, rather than initiating new programs.

And lastly, let's talk about real assets. The, quote, risk-on market environment and rotation into the most beaten up sectors helped real assets last week, and most real asset based equities actually outperformed the S&P 500 quite handily. The market seems to be pricing in a reopening recovery after the strong employment report that we got last Friday.

So in our view, we still think the market is a bit exuberant about growth assumptions in some of these real asset sectors, and additionally, the one-month extension of the OPEC Plus production cut has now been reported to be a voluntary cut, with no policing mechanism for compliance. So we still believe that too many questions exist around demand after this virus is contained in order for anyone to overweight these sectors.

So of course, as you all know, things can quickly change. We just saw that in the last couple of days. But our team of investment strategists are constantly publishing up-to-date market insights and guidance, all of which you can find at usbank.com/marketnews. And this can be a great resource for you if you're one of those folks who are interested in following the market more closely.

So now that you understand a little bit more about what's happening with the market, I want to cover some strategies that can not only help protect your investment portfolio, but also give you some things to think about and to consider that may help stabilize your finances in general. So first of all, don't panic. And it's a natural reaction in times like this to feel a little panicky. I admit to it myself, even though I've worked in the business. But if you look at the history of the market's expansions and contractions, you can get a fresh perspective on the advantages of investing for the long term.

And this chart that I'm showing here on the screen right now shows the performance of the S&P 500 over the last three decades. And as you know, the S&P 500 is a capitalization index of 500 widely traded stocks that are broadly representative of the performance of the stock market in general. And despite sizable declines in many years-- and I'm sure a lot of you remember 2008-2009, when it was down 38%-- I certainly do-- in 21 out of the last 30 years, the S&P ended up with a positive gain, as you can see from this chart here.

So what can you do? Well, if you do have extra cash available and you're comfortable with the cash reserves that you have on hand, give some thought to starting or continuing to contribute to a retirement account, like 401(k)s or IRAs. If you don't have a retirement account yet, a 401(k) is definitely worth considering, especially since your employer offers a match. Intel will match pre-tax and/or Roth contributions up to a maximum of 5% of your eligible pay each pay period.

And remember, after-tax contributions are not eligible for that match but you're you're always 100% vested in your contributions and in the 401(k) match. And as your employer does offer a match on your 401(k), this should be the first place to invest and the last place to stop investing. If you already have a retirement account, but you find that you don't have as much cash available to contribute as you have in the past, you should still consider trying to prioritize your contributions to your 401(k), for all of the reasons that I just mentioned.

Another thing you might want to consider with the recent decline in the market is that you'll be able to buy more for less. Stocks are on sale, said another way, which really could work out well for you in the long term. You may have heard of the concept of dollar cost averaging, which is a strategy in which an investor places a fixed dollar amount into a given investment, like a common stock or a mutual fund or a money market fund, on a regular basis.

And this investment generally takes place each and every month, regardless of what is happening in the financial market. And the result of this strategy is that, when the price of a given investment rises, the investor won't be able to purchase as many shares, they'll purchase fewer shares, but also, when the price of a particular security declines, the investor will be able to purchase more shares. It's really difficult to try to time the market, and past history has shown that you're better off staying in the market by continuing to contribute the same amount each month.

So it's during times like the ones we're in now when it's even more important to meet with your financial advisor. And if you don't have a financial advisor, it's an opportunity for you to consider getting one. I get asked a lot of times what's the best way to find an advisor. And my advice is to ask your family, ask your friends, ask someone that you trust that you know has done a good job with their financial management. Ask them for a recommendation. And once you get a referral, contact the advisor and interview him or her, and make sure you're comfortable with them, that they can speak to you in a way that you understand, that they can relate to you, and that you feel that they have your best interests in mind.

So the financial advisors will work with you to develop a customized financial plan to help meet your unique needs. They'll want to understand your goals, and they can help make adjustments to your investment strategy, if needed. Remember, this is their full-time job, and they're specialists in their field. They understand the markets, they watch them all the time, and they can offer you an experienced perspective on your financial strategy. And this is even more important if you have complex financial needs or if you have multiple goals that you're trying to achieve that really require more specific and one-on-one guidance.

They can also help reassure you that you're on track toward your goals. And I can promise you, when the latest adjustments to the stock market happened, my husband and I spent some time talking with our financial advisor just to make sure that our plan was still on track and there weren't any adjustments we needed. And one of the great things that a financial advisor can do is to help keep you from making emotional, panic-driven decisions, because that does come to mind sometimes in times like this. And also, remember, with the advancements in technology, an advisor can work with you in person, but you can also meet with an advisor over the phone, and even do a video conference, which is what my husband and I did when we met with our advisor.

So another option you might want to consider for investing is a robo-advisor. And robo-advisors are a relatively new option for investors. Most have only been around for the last five years or so. At US Bancorp Investments, we launched ours about four years ago. And a robo-advisor basically lets you guide how you want your investments to be set up, but then manages them for you based on sophisticated algorithms.

So how does that work exactly? Well, the robo-advisor will build a custom investment portfolio based on your goals and your risk tolerance and your time horizon-- those are the three main factors-- and then will consistently monitor and rebalance your portfolio based on your investment model. And it makes adjustments as the market fluctuates. So these adjustments are what we refer to as auto-rebalancing.

So let me give you an example of how it works. So let's say, for your portfolio, it's determined that you should have 70% of your money invested in a more aggressive bucket of funds and 30% in conservative funds. And if the market fluctuates over time, you could end up with something closer to an 80/20 ratio. And this might mean that too much of your money is allocated into that aggressive bucket.

And when this happens, the robo-advisor will buy and sell appropriately to get you back to your ideal 70/30 mix. So the robo-advisor monitors your account regularly and it keeps an eye on how your portfolio is performing. And it's all done for you automatically. And this helps you stay on track to meet your goals even during large market fluctuations, like the ones we're experiencing.

So now, let's turn to financial planning. And I am a big proponent of financial planning, and for everyone having some type of financial plan. And having or revisiting your financial plan is very important when it comes to protecting your investment portfolio. Having a plan can also help you gain financial peace of mind. And a financial planner can also keep all of your finances, not just those tied to your investments, on track.

So some things to think about right now, for example, are your financial goals still appropriate? Are they still reachable? Have you had to deal with sudden changes in your own economic circumstances, things like a spouse or a partner having lost their job recently? Were you forced to deplete some of your emergency cash reserves to cover immediate expenses? It's factors like these that may indicate it's a good time to review your financial plan. And it's really important to keep your financial goals on track as much as possible, even through challenging times.

And as part of your overall financial plan, there are some other areas of opportunity that I want to ask you to consider. First one is the state of your emergency fund. Having the flexibility to address immediate expenses is one of the core aspects of good financial planning. We have asked how much do you need, and we believe you should be sure you have at least three to six months of monthly expenses set aside in easily accessible cash account, like checking accounts or savings account or money market account.

If you've had to tap into your reserves in recent months, explore other options to meet short-term needs. And one of the new options that we have available to us in 2020 is a penalty-free flexibility to tap into your retirement account to meet short-term needs. You'll still be responsible for the other regular taxes. Only the penalty is waived. And if this is something that you want to consider, a key is to avoid having to liquidate long-term positions, such as stocks, that may have recently lost value.

If you do have to make a withdrawal against your retirement account, you also do have the option to put it back in at a later date. So when you're ready to reinvest, this is another challenge. You want to make sure that you have a set plan to redeploy that cash. There have actually been studies showing that market timing is difficult, and that redeploying cash from the sideline can be psychologically challenging. And I know I've personally experienced that when you're getting ready to put it back in the market.

So one of the things that you can do to help your discipline around that is to develop a plan based on a set time or a particular price to redeploy this cash, because cash left on the sidelines will undermine the achievement of your financial goals, as cash holdings have historically returned less than most other investments and inflation over time. And as we discussed earlier, success in a financial plan is often delivered through time invested in the market, rather than timing of the market.

Another thing that you can consider is managing your income tax liability. Are any of your investments that are in your already taxed accounts in loss positions that might offer you a way to offset capital gains or ordinary income taxes? Could you benefit by having a greater percentage of your traditional IRA savings in a Roth IRA account?

Remember, you have to be eligible to have a Roth IRA account. There are income limits. But that could offer you the potential for tax-free distributions down the road. Do you have access to incentive stock options at work? Is your portfolio still properly balanced to reflect your current risk profile? If any of these apply to you, there are potential opportunities to more efficiently manage your current and future taxes.

So let's just look at one example a little more closely. Consider converting traditional IRA assets to a Roth IRA. And again, remember, you have to be eligible, because there are income limits in order to have a Roth. A Roth conversion allow someone to convert all or a portion of their retirement savings from accounts like a traditional SEP or SIMPLE IRA or a 401(k), and to convert them into a Roth IRA.

Now, remember, this will be a taxable event because you did not pay taxes on these contributions at the time you made them. But this may be a prime opportunity to convert assets currently in a tax-deferred retirement account that have declined in value to a Roth account, because since taxes are due based on the account value on the date that you make the conversion, choosing to convert to a Roth IRA when your account value is reduced should help limit the tax liability. And then once the market recovers and the value of the converted units increase, you'll benefit from a higher-- you may be able to benefit from a higher tax-free balance in that Roth IRA. And really, your tax advisor and your financial professional can help determine which, if any, of these options are right for you, and to help you manage your income tax liabilities.

And updating your estate plan cannot be underestimated here. COVID-19 has been a very painful reminder for many families of why we all need to make sure that we have our personal documents in place. You may have sharpened your focus on making sure all of your affairs are in order, but if you haven't, now is an optimal opportunity to set aside some time to look at some of your key estate planning documents. Make sure your will, your trust, things like health care directives and power of attorney designations are all up-to-date. And the same is true for beneficiary designations on IRAs and other retirement accounts.

And one additional note I want to make on beneficiary designation. You may have had the best of intentions in naming a non-spouse beneficiary, such as children or grandchildren, to inherit your IRA or your workplace savings plan, but under new laws that took effect in 2020, this may create a greater tax burden for them, because instead of being able to calculate annual distributions from inherited accounts based on their own life expectancy, non-spouse beneficiaries must now withdraw the full balance in the inherited retirement account within 10 years. So you should discuss this with a legal or a tax advisor.

And also, make sure that assets are properly titled in accordance with your estate planning intentions. Identify somebody you trust to have access to your online accounts and passwords, if need be. I have nightmares about not having all my passwords written down in the same place where my family could find them if they needed to. So have a family discussion about what steps to follow if one or more family members should become seriously ill.

And lastly, plan for unexpected events. And one of the best things you can do is to review your life insurance and your long-term care insurance. In the midst of a global pandemic, it's only natural for people to think about the potential impact on their own lives, as well as their loved ones, if they were to get sick. This makes it a good time to review some of your insurance coverage, such as your life insurance and long-term care policy.

Insurance protection is an important part of your overall wealth plan. And by considering your goals and your whole financial situation, you can determine the type and amount of insurance that meets your need. A solid insurance protection plan is so important so you won't have to draw down your savings or liquidate your investments, should you ever find yourself in a crisis. No matter what your stage in life, the right protection can help you feel more confident that you're prepared for whatever lies ahead.

So that brings us to a close today. Jill and I want to thank you for attending today's webinar. And remember, for more information, you can look for the branch locations that Jill went through or visit usbank.com/wealth-management. Thanks so much for being with us, and have a great day.

JILL ENABNIT: Thank you. That concludes today's session. We hope you have a wonderful day. 

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