Oppenheimer & Co. Inc.McCann & Ward Private Client GroupWilliam J. McCann, Director - InvestmentsMary E. Ward, CFSAssociate Director - Investments325 North Old Woodward AvenueSuite 370Birmingham, MI 48009248-593-3729248-593-3716william.mccann@opco.commary.ward@opco.com

September 2015Tips for Women Entrepreneurs

Six Life Insurance Beneficiary Mistakesto Avoid

Three Tax Planning Concepts

Are stock dividends reliable as a sourceof income?

The Big PictureEssential Wealth StrategiesTips for Women Entrepreneurs

See disclaimer on final page

Check out our website:

http://fa.opco.com/mccann.ward

According to theNational Women'sBusiness Council,nearly 8 millionwomen-ownedbusinesses exist inthe United States.Women-owned firmscomprise 28.7% ofall nonfarmbusinesses and

generate more than $1.2 trillion in revenue.Interestingly, 88.3% of women-ownedbusinesses have no employees, indicating thatmany women strike out on their own, perhapsto better balance work and family.¹ If you'reconsidering the launch of a new venture (orknow someone who is), the followinginformation may be helpful.

Facing unique challengesAlthough there are no gender differences in thesteps involved in starting a business, womenmay indeed face unique challenges when itcomes to implementing those steps.

According to a Babson College study, womenentrepreneurs tend to have less confidencethan their male peers. Among those who haveidentified new business opportunities, 34% ofwomen admit to a fear of failure, compared with29% of men, and less than half of womenbelieve they have the capabilities to start abusiness, compared with 63% of men.²

Women may also face challenges in securingventure capital (VC) funding. In a differentstudy, Babson researchers found that 85% ofall VC-funded companies have no women onthe executive team, and only 2.7% ofVC-funded companies are led by a womanCEO. However, VC firms with women partnerswere more than twice as likely to invest in firmswith women on the executive team and morethan three times as likely to fund a companywith a woman at the helm.³

Overcoming the obstaclesSo what should a woman with a great businessidea do?

First and most important, define what success

means to you. Do you want a thriving operationwith dozens of employees, or are you lookingfor self-employment to bring in additionalincome while allowing more time for familyneeds? Or maybe it's something in between?Be sure you have a clear vision of your dreambefore you launch.

Understand that preparation and knowledge arekeys to building confidence. Develop a writtenbusiness plan that describes your business'sproducts and/or services, target market,marketing and sales strategy, opportunities andchallenges, competition and how you willaddress it, and other key success factors. Thisdocument and the hard work involved inpreparing it will be especially important if youplan to seek financing from lenders, angelinvestors, VC firms, or other outside sources.The required research will help prepare you toanswer the tough questions from potentialfinanciers.

Know that successful entrepreneurs aretypically willing to take calculated risks. Don't letfear drive your decision making. Once again,preparation is important, but don't let youranalysis end up in paralysis.

Be sure you have enough funds set aside tosurvive the start-up phase, which can last aslittle as a few weeks or as long as severalyears, depending on your business. Havingenough money to live on during this period mayfurther bolster your confidence, reduce fear offailure, and support wise risk taking.

Finally, take heart in knowing help is available.The Small Business Administration,Women's Business Centers, and CommunityDevelopment Financial Institutions (CDFIs)across the country provide resources andinformation especially for women businessowners.

¹ National Women's Business Councilfact sheet, June 2015

² Babson College, Global EntrepreneurshipMonitor, 2013 United States Report

³ Babson College, Women Entrepreneurs 2014:Bridging the Gender Gap in Venture Capital

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Six Life Insurance Beneficiary Mistakes to AvoidLife insurance has long been recognized as auseful way to provide for your heirs and lovedones when you die. Naming your policy'sbeneficiaries should be a relatively simple task.However, there are a number of situations thatcan easily lead to unintended and adverseconsequences. Here are six life insurancebeneficiary traps you may want to avoid.

Not naming a beneficiaryThe most obvious mistake you can make isfailing to name a beneficiary of your lifeinsurance policy. But simply naming yourspouse or child as beneficiary may not suffice.It is conceivable that you and your spousecould die together, or that your namedbeneficiary may die before you. If thebeneficiaries you designated are not living atyour death, the insurance company may paythe death proceeds to your estate, which canlead to other potential problems.

Death benefit paid to your estateIf your life insurance is paid to your estate,several undesired issues may arise. First, theinsurance proceeds likely become subject toprobate, which may delay the payment to yourheirs. Second, life insurance that is part of yourprobate estate is subject to claims of yourprobate creditors. Not only might your heirshave to wait to receive their share of theinsurance, but your creditors may satisfy theirclaims out of those proceeds first.

Naming primary, secondary, and finalbeneficiaries may avoid having the proceedsultimately paid to your estate. If the primarybeneficiary dies before you do, then thesecondary or alternate beneficiaries receive theproceeds. And if the secondary beneficiariesare unavailable to receive the death benefit,you can name a final beneficiary, such as acharity, to receive the insurance proceeds.

Naming a minor child as beneficiaryUnintended consequences may arise if yournamed beneficiary is a minor. Insurancecompanies will rarely pay life insuranceproceeds directly to a minor. Typically, the courtappoints a guardian--a potentially costly andtime-consuming process--to handle theproceeds until the minor beneficiary reachesthe age of majority according to state law.

If you want the life insurance proceeds to bepaid for the benefit of a minor, you mayconsider creating a trust that names the minoras beneficiary. Then the trust manages andpays the proceeds from the insuranceaccording to the terms and conditions you setout in the trust document. Consult with anestate attorney to decide on the course that

works best for your situation.

Per stirpes or per capitaIt's not uncommon to name multiplebeneficiaries to share in the life insuranceproceeds. But what happens if one of thebeneficiaries dies before you do? Do you wantthe share of the deceased beneficiary to beadded to the shares of the survivingbeneficiaries, or do you want the share to passto the deceased beneficiary's children? That'sthe difference between per stirpes and percapita.

You don't have to use the legal terms indirecting what is to happen if a beneficiary diesbefore you do, but it's important to indicate onthe insurance beneficiary designation form howyou want the share to pass if a beneficiarypredeceases you. Per stirpes (by branch)means the share of a deceased beneficiarypasses to the next generation in line. Per capita(by head) provides that the share of thedeceased beneficiary is added to the shares ofthe surviving beneficiaries so that eachreceives an equal share.

Disqualifying the beneficiary fromgovernment assistanceA beneficiary you name to receive your lifeinsurance may be receiving or is eligible toreceive government assistance due to adisability or other special circumstance.Eligibility for government benefits is often tied tothe financial circumstances of the recipient. Thepayment of insurance proceeds may be afinancial windfall that disqualifies yourbeneficiary from eligibility for governmentbenefits, or the proceeds may have to be paidto the government entity as reimbursement forbenefits paid. Again, an estate attorney canhelp you address this issue.

TaxesGenerally, life insurance death proceeds arenot taxed when they're paid. However, thereare exceptions to this rule, and the mostcommon situation involves having threedifferent people as policy owner, insured, andbeneficiary. Typically, the policy owner and theinsured are one in the same person. Butsometimes the owner is not the insured or thebeneficiary. For example, mom may be thepolicy owner on the life of dad for the benefit oftheir children. In this situation, mom iseffectively creating a gift of the insuranceproceeds to her children/beneficiaries. As thedonor, mom may be subject to gift tax. Consulta financial or tax professional to figure out thebest way to structure the policy.

Note: As with most financialdecisions, there are expensesassociated with the purchaseof life insurance. Policiescommonly have mortality andexpense charges. In addition, ifa policy is surrenderedprematurely, there may besurrender charges and incometax implications.

Note: While trusts offernumerous advantages, theyincur up-front costs and oftenhave ongoing administrativefees. The use of trusts involvesa complex web of tax rules andregulations. You shouldconsider the counsel of anexperienced estate planningprofessional and your legal andtax advisors beforeimplementing such strategies.

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Three Tax Planning ConceptsThere are many ways to potentially reduce yourtax burden. Here are three tax planningconcepts that you should be familiar with.

Tax deferralWhen you defer taxes to later years, anyearnings compound without being reduced byincome taxes. As a result, your investment maygrow at a faster rate than if earnings weresubject to income tax each year. In somecases, such as with a qualified plan or atraditional IRA, tax deferral may be combinedwith an initial tax deduction or exclusion fromincome for contributions.

Tax deferral can be provided bytax-advantaged accounts that generally deferany taxation until distributions are made.Examples include qualified plans and IRAs,annuities, health savings accounts (HSAs),Coverdell education savings accounts (ESAs),and 529 plans. Taxation of capital gains isgenerally deferred until property is sold. Taxdeferral may also be available through the useof strategies such as installment sales andlike-kind exchanges.

Tax deferral can be the most beneficial whenyou defer tax until a time when your tax rate willbe lower, or at least when it will be no higher. Ifyour tax rate will be higher later, there may stillbe an advantage to tax deferral, but you'll needto run the numbers to determine whether thebenefits of tax deferral might overcome thehigher tax rate.

Example: You make a nondeductiblecontribution of $5,000 to a traditional IRA.Assume you will be subject to a 28% incometax rate, both now and in the future. If you earna 5% annual rate of return for 20 years, the$5,000 will grow to $13,266, with an after-taxvalue of $10,952. (If you made a deductiblecontribution of $5,000 to a traditional IRA andplaced any tax savings from the deduction in aside fund, the after-tax value of the IRA plus theside fund after 20 years would generally beeven greater.) If instead you simply saved$5,000 in an account that is taxable each year,the $5,000 would grow at a 3.6% after-tax rateto $10,095 in 20 years. This is $857 less thanwith the tax-deferral advantage of making anondeductible contribution to a traditional IRA.*

Tax-free incomeInterest income from municipal bonds cangenerally be received free of federal incometax. Qualified distributions from Roth IRAs,Roth 401(k)s, HSAs, ESAs, and 529 plans canalso be received free of federal income tax. Insome cases, such as with a Roth IRA, taxdeferral may be combined with tax-free income.

Example: You make a nondeductiblecontribution of $5,000 to a Roth IRA. If you earna 5% annual rate of return for 20 years, the$5,000 will grow to $13,266, with no federalincome tax on qualified distributions.*

Special tax ratesThe tax rate on long-term capital gains andqualified dividends is generally 0% fortaxpayers in the 10% and 15% tax brackets,15% for taxpayers in the 25% to 35% taxbrackets, and 20% for taxpayers in the 39.6%tax bracket. In some cases, such as with stock,special tax rates may be combined with taxdeferral.

Example: You purchase stock that pays nodividends for $5,000. Assume you will besubject to a 15% capital gain tax rate, both nowand in the future. If the stock increases 5% invalue each year and you hold on to the stockfor 20 years, the $5,000 will grow to $13,266,with an after-tax value of $12,027.*

Example: You purchase a dividend-payinginvestment for $5,000. Assume you will besubject to a 15% capital gain tax rate, both nowand in the future. If you earn a 5% annual rateof return consisting of qualified dividends andlong-term capital gains that are taxable eachyear, the $5,000 will grow at a 4.25% after-taxrate to $11,460 in 20 years.*

Note: To the extent that distributions fromtax-advantaged accounts such as qualifiedplans and IRAs, annuities, HSAs, ESAs, and529 plans are subject to tax, ordinary incometax rates apply; they generally do not qualify forspecial capital gain tax rates.

*These hypothetical examples are forillustrative purposes only, and the results arenot representative of any specific investment ormix of investments. Actual results will vary.Investment fees and expenses have not beendeducted. If they had been, the results wouldhave been lower. You should consider yourpersonal investment time horizon and incometax brackets, both current and anticipated,when making an investment decision, becausethey may further impact the results of thecomparison. These illustrations assume a fixedannual rate of return; the rate of return on youractual investment portfolio will be different, andwill vary over time, according to actual marketperformance, and could include losses. This isparticularly true for long-term investments. It isimportant to note that investments offering thepotential for higher rates of return also involve ahigher degree of risk to principal.

An additional 3.8% netinvestment income tax mayapply to some or all of yournet investment income ifyour modified adjustedgross income exceedscertain thresholds. This taxdoes not apply to qualifiedplans and IRAs or totax-free income.

Distributions from qualifiedplans and IRAs prior to age59½ may be subject to a10% penalty tax unless anexception applies.Nonqualified distributionsfrom HSAs, ESAs, and 529plans may also be subjectto a penalty tax.

You might also consider theeffect of state income tax.

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Oppenheimer & Co. Inc.McCann & Ward Private Client GroupWilliam J. McCann, Director - InvestmentsMary E. Ward, CFSAssociate Director - Investments325 North Old Woodward AvenueSuite 370Birmingham, MI 48009248-593-3729248-593-3716

william.mccann@opco.commary.ward@opco.com

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2015

The content herein should not beconstrued as an offer to sell or thesolicitation of an offer to buy anysecurity. The information enclosedherewith has been obtained fromoutside sources and is not theproduct of Oppenheimer & Co. Inc.("Oppenheimer") or its affiliates.Oppenheimer has not verified theinformation and does notguarantee its accuracy orcompleteness. Additionalinformation is available uponrequest. Oppenheimer, nor any ofits employees or affiliates, does notprovide legal or tax advice.However, your OppenheimerFinancial Advisor will work withclients, their attorneys and their taxprofessionals to help ensure all oftheir needs are met and properlyexecuted. Oppenheimer & Co. Inc.Transacts Business on all PrincipalExchanges and is a member ofSIPC.

How can I protect my Social Security number fromidentity theft?Your Social Security number isone of your most importantpersonal identifiers. If identitythieves obtain your Social

Security number, they can access your bankaccount, file false tax returns, and wreak havocon your credit report. Here are some steps youcan take to help safeguard your number.

Never carry your card with you. You shouldnever carry your Social Security card with youunless it's absolutely necessary. The samegoes for other forms of identification that maydisplay your Social Security number (e.g.,Medicare card)

Do not give out your number over the phoneor via email/Internet. Oftentimes, identitythieves will pose as legitimate governmentorganizations or financial institutions andcontact you to request personal information,including your Social Security number. Avoidgiving out your Social Security number toanyone over the phone or via email/Internetunless you initiate the contact with anorganization or institution that you trust.

Be careful about sharing your number. Justbecause someone asks for your Social Security

number doesn't mean you have to share it.Always ask why it is needed, how it will beused, and what the consequences will be if yourefuse to provide it.

If you think someone has misused your SocialSecurity number, contact the Social SecurityAdministration (SSA) immediately to report theproblem. The SSA can review your earningsrecord with you to make sure their records arecorrect. You can also visit the SSA website atwww.ssa.gov to check your earnings recordonline.

Unfortunately, the SSA cannot directly resolveany identity theft problems created by themisuse of your Social Security number. If youdiscover that someone is illegally using yournumber, be sure to contact the appropriatelaw-enforcement authorities. In addition,consider filing a complaint with the FederalTrade Commission and submitting IRS Form14039, Identity Theft Affidavit, with the InternalRevenue Service. Visit www.ftc.gov andwww.irs.gov for more information.

Are stock dividends reliable as a source of income?Dividends can be an importantsource of income. However,there are several factors youshould take into considerationif you'll be relying on them to

help pay the bills.

An increasing dividend is generally regarded asa sign of a company's health and stability, andmost corporate boards are reluctant to cutthem. However, dividends on common stockare by no means guaranteed; the board candecide to reduce or eliminate dividendpayments. Investing in dividend-paying stocksisn't as simple as just picking the highest yield;consider whether the company's cash flow cansustain its dividend, and whether a high yield issimply a function of a drop in a stock's shareprice. (Because a stock's dividend yield iscalculated by dividing the annual dividend bythe current market price per share, a lowershare value typically means a higher yield,assuming the dividend itself remains the same.)

Also, dividends aren't all alike. Dividends onpreferred stock typically offer a fixed rate ofreturn, and holders of preferred stock must bepaid their promised dividend before holders ofcommon stock are entitled to receive theirs.

However, because their dividends arepredetermined, preferred stocks typicallybehave somewhat like fixed-incomeinvestments. For example, their market value ismore likely to be affected by changing interestrates, and most preferred stocks have aprovision allowing the company to call in itspreferred shares at a set time or at a specifiedfuture date. If you have to surrender yourpreferred stock, you might have difficulty findingan equivalent income stream.

Finally, dividends from certain types ofinvestments aren't eligible for the special taxtreatment generally available for qualifieddividends, and a portion may be taxed asordinary income.

Note: All investing involves risk, including thepotential loss of principal, and there can be noguarantee that any investing strategy will besuccessful. Investing in dividends is a long-termcommitment. Investors should be prepared forperiods when dividend payers drag down, notboost, an equity portfolio. A company's dividendcan fluctuate with earnings, which areinfluenced by economic, market, and politicalevents.

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