BITCOIN! 3 things you need to know

Bitcoin image.jpg

by Tracy Ann Miller, CFP

Todays' world shattering news that Bitcoin (one of many Cryptocurrencies) has broken two highs within a single day and posted over a 900 percent return since the start of 2017, has many people asking:

1)   What is it?

2)   Should I invest in it?

3)   What are the risks?

Bitcoin is a cryptocurrency – defined by Wikipedia, "a cryptocurrency is a digital asset designed to work as a medium of exchange using cryptography to secure the transactions, to control the creation of additional units, and to verify the transfer of assets". Bitcoin, created in 2009, was the first decentralized cryptocurrency. Stay tuned for more posts on why it’s important to understand what a cryptocurrency is.

Bitcoin may be an investment but at this point, I have to say if it is, this investment fits squarely into the speculative piece of the investment allocation pie. My advice is to limit the amount of your total investable retirement capital to anything speculative including cryptocurrencies. That means no more than a 5% allocation on the conservative side to 15% if you are more aggressive.  Keep in mind you need to add all of the money you have in speculative investments to make sure you are not adding too much. Earlier in 2017,  I opened a cryptocurrency account and purchased a small amount of Bitcoin. Honestly I did it for the research aspect of it and I am tempted right now to get out and take the profit.  It has been quite an experience, so for this reason I do recommend that people open a cryptocurrency account for the experience.  Do you own any physical gold or silver?  If so, you had to buy it in a completely different way than you buy other investments and there is no way to truly understand what that is like until you do it yourself. Invest in the learning experience.

The risk in buying Bitcoin at this stage is that the current price indicates that the value has gone too far too fast.  Take at look at the 2017 price chart!

2017 Year to Date Bitcoin Price. Up over 900%

When that happens, statistically you are more likely to see a drop in price than for the price to continue moving higher.  That being said, I have yet to see this big of a bull market in anything in my 30 years in finance. Clearly new ground and worth paying attention to.  New technologies present tremendous upside potential because they are new, unknown, unproven. When you invest in 'unproven' you should get a higher return. The other side of the coin? New technologies also present tremendous risks, even complete failure.  The phrase caveat emptor (let the buyer beware) clearly applies at this point.

How You Can Be a Forensic Investigator

Lee Munson is interviewed by Bruce Love from Financial Times’ Financial Advisor IQ. This is the second installment of a long form interview in which Munson explains his last 10 years working with Clinton Marrs going after bad actors in the investment industry. 

Tax Efficient Savings for your Children

Is your money working as hard as it could be?

Are you earning too little and giving too much of the earnings to Uncle Sam?

Then it might be time to revisit the ROTH IRA.  In particular Roth IRA’s for children. 


Recently a client asked me this question: Does parental income affect a dependent child's Roth IRA contributions? 

I thought it would be a good time to explore some of the rules. 

Many times a grandparent or family relative wants to set up a Roth IRA for his grandchildren or niece/nephews.  The family relative might provide the funds to deposit to a Roth IRA account either by directly gifting the funds or by initiating a “matching” program (great idea!!)  So, the question is, does the parent’s income, as the parent claiming the child as a dependent, affect the dependent child's eligibility?

The answer is, a child must have his or her own earned income to qualify for a Roth IRA contribution in the year for which the contribution is made. But, he or she does not have to have a W-2 to justify opening the IRA.  Many children do informal jobs for which they are paid and the total of this income can be used as a contribution.  The parent or grandparent can provide funds for the child to contribute.  If the IRS ever asks about this income (which is unlikely) be prepared to show a journal of the income received to document the amount.  It's a good idea to do this at any rate and to keep an ongoing journal record.  The child needs to know the amount of income they earned even if they are not required to make a tax return for the year they make the contribution. This record ensures they contributed only up to the amount earned or the IRA contribution limit for the year (whichever is less).  Roth contributions are not reported on the tax return, but in the long run it is best to know the full amount of actual contributions versus earnings from investments. This is important in the event the money is used before the child’s retirement as Roth withdrawals are potentially taxed if the rules are not followed.

The difference between the old fashioned savings bonds and the tax free savings growth in a Roth IRA can be staggering when you consider the length of time of the investment.  Add to that the potential growth of a well balanced mutual fund investment and your child can have a well planned retirement no matter what the future tax policies might look like. 


Lee Munson Helps Victims Fight Back Against Bad Brokers

When I traveled to NYC in August, Bruce Love, Financial Times journalist and Editor-in-Chief of Financial Advisor IQ, wanted to sit down and talk to me about being a forensic investigator. While it’s a small part of what I do, it gives me incredible insights into how the industry is changing, and what effects client’s the most.

This is a three part series, and I’m grateful that Financial Times dedicated so much time and effort for a rare long-form interview.

Stay tuned for part 2 and 3. 

Portfolio Wealth Advisors makes the Albuquerque Business First’s Top Private Companies List

We ask Lee Munson, Chief Investment Officer of Portfolio Wealth Advisors about what it means to make the list. 



“After making the Private 100 over the past several years, it was no surprise that we made Albuquerque Business First’s Top Private Companies List. My business parter, Tracy Ann Miller, and I have discussed our plans for growth and find our best work is done one on one rather than ramping up and hiring. You can’t hire a kid out of business school to do what we do. It simply takes to many years to amass the knowledge necessary to help people live off their assets. Sure, any kid can help you save and grow money when you are young, but retirement is whole other ball game that takes more wisdom than experience. With that said, it’s an honor to own a firm that has had this type of success in New Mexico. My word of advice: anyone can make it in New Mexico.”

If you would like to learn how our firm can help you find success in retirement, reach us at [email protected]

Fox Business Asks Lee Munson His Insights On Market Conditions

It’s always a pleasure to be asked to appear on a big show. It’s even better to have Lauren Simonetti simply ask me what I think about markets and let me talk. One of the advantages of being in the News Corp studio in midtown Manhattan is feeling the energy of a live set. When it’s just you and the host, you have the time (having time on live TV is relative, of course) to develop an idea and get a few things out there you can’t do when arguing with some other guest about a topic you don’t care about. 

I tell it like it is – I expect a small pullback, but that’s not a new idea. I talk about where to invest capital when the market has done well and spent a summer going sideways. When asked about the big central bank meeting in Jackson Hole, I say we won’t get any bombshells. However, if there are any hawkish comments that cause a pullback – you want to think about buying that dip. 

Remember, there is a reason I’m asked to be on these shows. I provide a high level reality check on what the media is selling.

Lee Munson Interviewed By Yahoo! Finance On Solar Eclipse Day

Seana Smith and I go back over 5 years. She used to book me on After The Bell at Fox Business. Now she is in the driver’s seat hosting Yahoo! Finance’s morning show Market Movers. We covered a few key topics, but all we really want to know is where the market is heading. Spoiler alert: over time it goes up.

“When everyone wants something to happen, it ain’t gonna happen” - Lee Munson on corrections.  

“When everyone wants something to happen, it ain’t gonna happen” - Lee Munson on corrections.  

The cold reality is that after months of quite markets, big Wall Street firms are seeing a big drop in trading revenues. So what is a pig to do? Well, if you have no material fundamental damage to the market, just tell people is has to go down or get more volatile because it hasn’t in months. Is that how you want to manage your money?


Our firm took a more realistic approach in which I outline in this interview. We rebalanced and took profits from the last 9 months. This period had significant gains in certain assets classes, especially international stocks. If we get a mild pullback (my opinion, but who cares) or a correction (the fear Wall Street is peddling), we have fresh capital to reinvest. 

Just remember that the big dogs out there aren’t selling stocks, they are hedging their portfolios using complex and costly derivatives to try and make some money while the market goes sideways. Let them have their side game all to themselves. 

Yahoo! Finance Asks Lee Munson, CIO of Portfolio Wealth Advisors: What is the biggest mistake investors make at record highs?

I love Yahoo! Finance. They give you plenty of time to talk, ask great questions, and don’t force me into a little box on the screen yelling at someone else. Jen Rogers is up to date and knows her stuff.

Here is the link:

Pullback? I WANT a pullback, people.

Pullback? I WANT a pullback, people.

First off, Jen Rogers asks me why how I use my background in investor behavior to manage my portfolios and clients. Simply said, many investors were not fully invested and others think an all time high means the market must crash – both are wrong.

Next, I wanted to discuss why I wanted a pullback. It’s simple, that way I can sell small parts of my client’s bond portfolios to buy stock from nervous investors that didn’t have a plan and don’t know what they are doing. Plus, nobody really has a good reason the market should go down other than a meaningless sell off before going higher. 

What exactly is going to bring the market down?

What exactly is going to bring the market down?

Lastly, I discuss exactly what I have been taking profits on, and what I want to do with the cash. 

I just want to see the tax cuts this fall!

I just want to see the tax cuts this fall!

The bottom line, look at profits, but here is what I really worry about. This fall, we have very little that can make this market go down 10-15%. I’m worried about not going down enough. Why? Because I want a sale on the market to buy low and sell high. It’s very simple.

Hey, look for the dip, and buy it, but don’t bet that we see a ‘big one’

Hey, look for the dip, and buy it, but don’t bet that we see a ‘big one’

If you want to talk about how I can help you live off your portfolio, call me at 505-884-3445

The Larry Kudlow Show Asks Lee Munson About Market Threats

Last week I was asked to be on The Larry Kudlow Show to talk markets with the man himself. As Chief Investment Officer of Portfolio Wealth Advisors, I’m in charge of communicating our investment strategy. Not to mention coming up with said strategy and executing it.

Here is the link:


arry Kudlow started having me on as a guest years ago when he had his top ranked CNBC show the Kudlow Report. Ever since then he has been supportive of my views. Well, most of the time. This half-hour interview covers basic questions like, will markets see a big correction or light selloff? How will profits play into this rally?

One of the things Larry talks about that most in the financial media ignore is the effect of currency on stock and bond returns. Since this is radio, we have a lot more time to talk about important issues beyond the sound bites. For that reason, radio has always been a favorite medium of mine.

If you want to meet with me personally about how I help people live off their portfolios, call 505-884-3445.


Fox Business Invites Portfolio Wealth Advisors CIO Lee Munson to Discuss Markets

August 7, 2017


This week I was in NYC meeting with client’s and having a blast with my daughter, Zoë. In between the trip to American Girl, MOMA, and American Natural History Museum, we got in a few media appearances.


Here is the link:

[use the pic of me below as the link picture]


And the You tube link [the main link I want people to use – so order it that way, and have the actual Fox link more off to the side – again, always promote the YouTube first since no ads and edited just to my part.

American Girl Café with Zoë and Chloë]

American Girl Café with Zoë and Chloë]

Sitting down with Gerri to talk markets]

Sitting down with Gerri to talk markets]

Gerri Willis was hosting Making Money on Fox Business. We sat down and discussed if investors should be concerned about the current market environment. Gerri is an experienced host that knows this can all be boiled down to a few things. 

HOLD ON people, we don’t have an inverted yield curve yet…

HOLD ON people, we don’t have an inverted yield curve yet…

First, we have no inverted yield curve. Lucky for viewers, Gerri stopped me in order to explain what that means. When short term interest rates are higher than long term rates, it’s called an inverted yield curve. What does that mean? Pretty much anytime you see it a recession is close by. We aren’t even close to those conditions. 

Pullback! I want a pullback! Explaining to Gerri why a mild pullback could be all we get, despite the negative investor sentimen

Pullback! I want a pullback! Explaining to Gerri why a mild pullback could be all we get, despite the negative investor sentimen

As long as we continue to have positive growth in profits and easy money from the Fed, don’t expect anything but market volatility. It’s a big recession we worry about, and that isn’t on the horizon for the near future. 

Gerri Willis – a first class act

Gerri Willis – a first class act

If you want more information on how I help client’s live off their stock and bond portfolio, call me at 505-884-3445.