CLEARWATER WEALTH PARTNERS
Client Meeting Transcript
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CLIENT: Chen Household (Sam & Alex Chen)
DATE: June 15, 2022
TIME: 2:00 PM
MEETING: 2022 Q2 Quarterly Review
LOCATION: Conference Room A, Clearwater Wealth Partners
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TRANSCRIPT
[0:00] Sarah Chen: This has been a difficult quarter for markets — I won't sugarcoat
it. The S&P is down about 22% year-to-date through yesterday. The Fed raised rates 50
basis points in May and 75 basis points last week — the largest single hike since
1994. Bonds are also negative, which makes it feel worse because there's nowhere to
hide in a traditional portfolio. Your portfolio is at $855,000. Down from $910,000 in
March, but meaningfully above the COVID low of $610,000.
[0:05] Sam Chen: This feels worse than COVID somehow. At least in 2020 we knew it
was temporary and the recovery was fast.
[0:06] Sarah Chen: That's a really common reaction and I think it's psychologically
accurate. In 2020 the drop was violent and fast — about 34% in 5 weeks — but the
recovery was just as fast. This is a slow grind lower over months, which is harder
emotionally because there's no clear turning point to look forward to.
Inflation-driven bear markets tend to resolve more slowly than panic-driven ones.
[0:09] Alex Chen: Are we doing anything?
[0:10] Sarah Chen: Yes, but not what you might expect. I'm actively looking at
tax-loss harvesting opportunities. When positions are down, we can sell and buy a
nearly identical replacement, realizing losses on paper that reduce your tax bill —
without changing your economic exposure in any meaningful way. The wash sale rule
requires us to wait 30 days before buying back the same security, but there are
adequate substitutes.
[0:13] Sam Chen: What specifically are you looking at?
[0:14] Sarah Chen: UECIX — your US equity core index fund — is down significantly
from the March 2022 purchase. The lot we bought has an unrealized loss of roughly
$21,000. I'd swap it for UECIY, a nearly identical index fund from a different
provider. Same economic exposure, different ticker, so the wash sale rule doesn't
apply. We'd crystallize the $21,000 loss and use it to offset gains this year or
carry it forward. I'm also looking at a similar swap on the international equity
sleeve.
[0:17] Alex Chen: And we wouldn't be selling out of equities — just swapping into
a similar fund?

[0:18] Sarah Chen: Exactly. Your allocation stays at 60/35/5. The economic exposure
to the US stock market is unchanged. But instead of sitting on unrealized losses that
do nothing for you, we harvest them and create a tax asset. In a year like this, with
NLTK income already on the books, that carryforward is valuable.
[0:20] Sam Chen: When would you do this?
[0:21] Sarah Chen: I'm not ready to execute today — I want to wait until we're deeper
into the summer when the picture is clearer. September is my target. If we execute
before September 30th, I'd want to make sure we're 30 days clear of any prior
purchases to avoid wash sale issues. I'll send you a formal recommendation before I
do anything.
[0:23] Alex Chen: Good. The NLTK Q2 vest — 625 shares?
[0:24] Sarah Chen: Yes — executed June 1st at $13.20. $8,250 W-2 income. NLTK is down
significantly from its highs — the vest price is the lowest we've seen since early
2020. Sold 450, held 175 per protocol. NLTK concentration is under 2% of portfolio at
these prices — well within cap. The lower income is actually helpful in a year where
the broader income picture is elevated from salary growth.
[0:26] Sam Chen: ACCT-CASH — we've been rebuilding it. Where are we?
[0:27] Sarah Chen: $18,200 — progressing nicely from the post-purchase drawdown. I
want to get to $25,000 by year-end as the primary emergency buffer. The home is a
year old now — the first-year surprise spending should be behind you. Action items:
I'll send you a formal TLH recommendation by September 1st for your approval; no
allocation changes; NLTK Q2 vest processed; ACCT-CASH rebuild continues.
[0:30] Meeting adjourned
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ACTION ITEMS
1. Prepare formal TLH recommendation (UECIXfiUECIY swap) — send by September 1 for
client approval
2. NLTK Q2 vest processed — sell 450, hold 175 — June 1 execution confirmed
3. ACCT-CASH rebuild target $25,000 by December 31
4. No allocation changes — maintain 60/35/5 through rate-hike cycle
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CONFIDENTIAL — For client use only. Not for distribution.
