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October 2008
In This Issue: John Hayman Radio Interview >>
3rd Quarter Market Letter >>
Current Market Watch >>
IRA & 401(k) Beneficiaries >>
Planning After Divorce >>

John Hayman Radio Interview KSRO 1350AM

Capital Advantage, Inc. Founder and President John Hayman talks with radio station KSRO (NewsTalk 1350AM) about how individual investors should strive to manage their personal finances during the current period of economic turmoil and market uncertainty.

Click HERE to Listen!

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3rd Quarter 2008 Market Letter Capital Advantage, Inc.

Throughout the several decades we have been working within the financial services sector, we have been able to successfully navigate through many market corrections, many bear markets, hyperinflation that led to bond market crashes, the 9/11 terrorist attacks, the dot-com bubble and resulting market fall, and numerous foreign currency collapses.  In prior economic upheavals, we always had a series of investment alternatives to which we could reallocate clients’ assets…but not this time.

This current crisis is truly global in nature. The value of every stock and bond market (excluding government securities) throughout the world has dramatically sold-off and not one sector stands in positive territory.

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Market Watch
Market Chart October 2008

The Standard and Poors 500 (S&P 500) is an index made up of five hundred different stocks. Each is selected for liquidity, size, and industry. The index is weighted for market capitalization. The S&P 500 is the benchmark of the overall market, and frequently used as the standard of comparison in terms of investment performance.

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Be Careful About Picking Beneficiaries for Your IRAs and 401(k)s

Inheriting IRA or 401(k) proceeds from a friend or relative can be a potentially huge windfall, but it can also be a sizable tax headache. For both the giver and the recipient, it’s worth seeking some advice.

Bank accounts, stocks/bonds, real estate, and life insurance proceeds generally pass to heirs free of income tax. However, inherited retirement benefits, such as, IRAs, annuities, 401ks, and pensions can be a different story. Beneficiaries have to pay ordinary income tax on distributions from retirement benefit plans and IRAs after they are inherited. For Roth IRAs – the benefits can be free of income tax to your heirs if all tax requirements are met.

Here are some general guidelines:

Spouses are the first stop: Federal law dictates that your surviving spouse must be the primary beneficiary of your 401(k) plan benefit unless your spouse signs a waiver to redirect those funds. Even with a traditional IRA, naming the spouse as the primary beneficiary may be an appropriate option.  Should the surviving spouse have his or her own IRA, this approach would allow them to simply roll over the assets from the decedent’s IRA into their own.  Furthermore, if the surviving spouse is significantly younger than the deceased, the surviving spouse would receive the added benefit of stretching out distributions from the IRA until he or she turns 70 1/2.  The stretch-out allows the assets to continue to grow on a tax- deferred basis, thereby maximizing asset value and delaying any income tax due.

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Make Estate and Financial Planning a First Step After Divorce


After a marriage breaks up, about the last thing most people want to do is sit down with one more attorney...

Regardless of your age or whether you have kids, it’s important to consult both financial and legal experts to make sure you have an updated estate and financial plan for your new life once the divorce decree is final.

It’s also best to blend estate planning with financial planning post-divorce. If you weren’t working with a financial or estate planner during the divorce process, it’s time to do so now. The immediate months after a divorce can be disorienting – even if you don’t move, you are literally starting a new household that you will have to direct yourself, and that means new money issues to face.

Learn More >>

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Capital Advantage Logo Did You Know?


Did you know Capital Advantage, Inc. can work with your friends and family (children, parents, siblings, and family trusts)? We are happy to waive our minimum asset requirement for your loved ones. Many existing clients already have us manage their childrens and parents accounts. Call John, Donna or Gary if you have a need at (925) 299-1500.

Contact Us
John Hayman Photo John Hayman, CFP
Founder and President

Email John
Donna Zinman Photo Donna Zinman
Vice President
Sr. Financial Advisor

Email Donna
Gary Clarke Photo Gary Clarke
Vice President
Sr. Financial Advisor

Email Gary
Rick McNamara Photo Rick McNamara, CFMC
Director of Investments

Email Rick
Dawnalizabeth Henke Photo Dawnalizabeth Henke
Chief Compliance Officer

Email Dawnalizabeth
Aimee Schwartze Photo Aimee Schwartze
Director of Client Service

Email Aimee
Catherine Norris Photo Catherine Norris
Client Service Manager

Email Catherine
Amy Montano Photo Amy Montano
Senior Administrator

Email Amy (AJ)
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3708 Mount Diablo Blvd., Suite 200
Lafayette, California 94549
Telephone: (925) 299-1500