Jobs, Wages, GDP Potential Areas of Growth in 2016

By many measures, the country’s economy is continuing on its upward trend.

The U.S. Bureau of Labor Statistics reported 242,000 new jobs in February 2016, with the unemployment rate unchanged at 4.9 percent. Industries with the highest number of jobs gains were health care and social assistance, retail trade, food and beverage and private educational services.

While these industries may have the highest number of jobs available, they’re not necessarily the highest-paying jobs. With the exception of doctors, most of the highest salaries go to people who work in the technology industry or hold a mid-level position that requires data analysis for strategy and product management.

[CLICK HERE to read the article, “Employment Situation Summary” from U.S. Bureau of Labor Statistics, March 4, 2016.]

[CLICK HERE to read the article, “25 Highest Paying Jobs in America” from GlassDoor.com, March 9, 2016.]

Another bit of good news is that, according to one 2016 salary forecast, workers across the country are expected to receive their biggest pay increase in three years. In many households, that may be the most significant indicator that the economy is recovering.

However, one of the lessons we learn from stagnant wages is how to “tighten the belt” and live on less. Just remember that if you do get a significant raise this year, one of the possible ways to utilize it is by investing. The more you invest today, and the longer your money has time to grow, the greater the potential for higher income in retirement. Please remember that investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. If you’d like to discuss ways to potentially optimize an increase in household income this year, let’s talk.

[CLICK HERE to read the article, “Employees Will Get the Biggest Salary Increase in Years In 2016” from FastCompany, Jan. 11, 2016.]

[CLICK HERE to read the article, “United States Wages and Salaries Growth Forecast 2016-2020” from Trading Economics, 2016.]

The combination of lower unemployment and higher wages also means people may be able to spend more money. This, in turn, drives economic growth, as is reflected in the 2016 outlook for the nation’s GDP. Greater consumption may also lead to higher production, distribution, revenues and return on investment for investors.

[CLICK HERE to read the article, “GDP Growth Slowed by Strong Dollar's Drag” from Kiplinger, Feb. 26, 2016.]

[CLICK HERE to read the article, “This map will change the way you see the US economy” from World Economic Forum, Feb. 15, 2016.]

We are an independent firm helping individuals create retirement strategies using a variety of insurance and investment products to custom suit their needs and objectives.

The information contained in this material is provided by third parties and has been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions.

If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference. 

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The 1%, the Lower 50% and the 49% In Between

Five years ago, 388 people were as wealthy as half the people in the world combined.

While that’s a lot of money divided among a small number of people, it’s nothing compared to where that number stands today. Currently, the world’s 62 richest people hold the same amount of wealth as the world’s poorest 3.5 billion.

Two things happened in this past five years to contribute to this vast discrepancy:

1.      The richest 62 people in the world increased their wealth by 44 percent (to $1.76 trillion)

2.      The wealth of the bottom half of the world saw their net worth drop by 41 percent

The recession kept many people out of the stock market because they needed funds to hold them over during job loss or wage stagnancy. At the same time, wealthy people who kept their jobs and/or had ample assets were able to stay in the market, which happened to experience a period of booming performance -- therein providing their large gains.

We believe that this experience illustrates the need to have patience in the markets no matter the circumstance. We can help you use your current assets to create strategies utilizing both investment and insurance products that help meet your long-term financial goals. Please remember that investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

[CLICK HERE to read the article, “The 62 Richest People on Earth Now Hold as Much Wealth as the Poorest 3.5 Billion,” from The Huffington Post, Jan. 17, 2016.]

[CLICK HERE to read the article, “Where Is All the World’s Money Going?” from The Economist; Jan. 19, 2016.]

With elections approaching, the growing divide of wealth has transcended economics and become a hot topic in the world of politics as well. According to one wealth expert, the most concerning trend for ultra-wealthy individuals is how the average person feels -- and votes -- this year in response to growing income inequality.

[CLICK HERE to read the article, “How inequality harms health -- and the economy,” from CBSNews, March 6, 2015.]

[CLICK HERE to read the article, “What does 2016 hold for the rich?” from Bankrate.com, Jan. 20, 2016.]

[CLICK HERE to read the article, “How the super-rich plan to invest in 2016,” from CNBC, Dec. 29, 2015.]

Another interesting component for the ultra-rich is the ability to monetarily support political candidates who favor wealth-protection strategies. Lobbying has practically become an industry in and of itself: Corporations now spend about $2.6 billion a year on reported lobbying expenditures.

As financial advisors, we want to stay abreast of where money is being spent and where it is being earned. It is our belief that tracking the activities of the 1 percent may help provide a roadmap for where the average person may want to invest, but our goal is to look out for your individual needs and objectives. While most of us are unlikely to reach the level of wealth enjoyed by the 1 percent, we’re here to help you navigate your way to a financial future in which you can have confidence.

We are an independent firm helping individuals create retirement strategies using a variety of insurance and investment products to custom suit their needs and objectives.

The information contained in this material is provided by third parties and has been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions.

If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference. 

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How to Cope With Market Volatility

The investment markets had a rocky start in 2016, and many analysts believe market volatility may continue to be a theme throughout the year.

Market volatility is a tough factor to deal with. It inherently makes us want to react, to change, to make things smooth and even keel. It may cause stress when you know that your investments can be impacted by elements completely out of your hands.

But there is something you can control in that regard. It’s your financial objectives -- your short- and long-term goals. If you’ve put strategies in place to help reach those goals, we believe volatility shouldn’t necessitate changes in most situations.

We always talk about “staying the course” but recognize that it’s easier said than done. If your situation changes, if your financial goals change or if you just need reassurance that your  financial plan is on track for your retirement income goals, feel free to reach out -- that’s what we’re here for. And periodically, we’ll reach out to you to help reassess your plan and ensure it’s still on track.

[CLICK HERE to read the article, “Poll: What the Market Volatility Is Telling Investors,” from Morningstar, Feb. 21, 2016.]

The Greek philosopher, Heraclitus of Ephesus, is quoted as the first to state, “Change is the only constant in life.” The same is true with investment markets. Today, there are plenty of people with their own philosophies on how to manage the constancy of change in the investment industry.

Jack Bogle, founder of the Vanguard Group, reiterates his mantra that investors should “stay the course” in this volatile market. He offers a rule-of-thumb strategy for volatility: 60 percent to 40 percent stock-to-bond ratio. In his words, “If you’re younger, a lot higher, if you’re older ... somewhat lower.”

We believe this may be good advice in general, but it doesn’t take into account personal factors such as investment timeline and tolerance for risk. For that, you should consider working with a  financial advisor to discuss your financial situation, risk tolerance and investment objectives. We will work with you to identify strategies utilizing both investment and insurance products that may help you address your concerns.

[CLICK HERE to read the article/view the video, “Don’t panic about market volatility: Jack Bogle,” from CNBC, Feb. 17, 2016.]

[CLICK HERE to read the article, “Mitigating the financial and emotional impact of market volatility,” from Columbia Threadneedle, Feb. 8, 2016.]

[CLICK HERE to read the article, “Personal Investment Strategies for Volatile Times,” from Knowledge@Wharton, Feb. 16, 2016.]

Market volatility frequently drives investors into more “safe-haven” financial products, such as CDs and cash. However, your safe haven today won’t necessarily be a safe haven when you retire. Small returns and low yields that do not keep up with the cost of living can put your retirement income in a challenging position.

The reality is that we as individuals can’t control the markets. When large numbers of investors all commit the same actions -- such as invest in a certain company and drive up its price, or sell and drop it precipitously -- we can influence the price of individual stocks. But there are far greater and overarching economic forces that impact market performance, such as oil production and the direction of interest rates.

All we can really do is control our own actions -- and, as Bogle suggests, take our emotions out of the picture and rely on a retirement strategy designed to meet our personal goals. That’s exactly what we’re here to help you do.

[CLICK HERE to read the article, “Investment Insights: No Relief,” from Merrill Lynch, Jan. 9, 2016.]

[CLICK HERE to read the article, “Vanguard CEO: Expect a lot less from stocks for a decade,” from CNBC, Jan. 25, 2016.]

Investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Any references to steady and reliable income streams refer only to fixed insurance products. They do not refer in any way to securities or investment advisory products.

We are an independent firm helping individuals create retirement strategies using a variety of insurance and investment products to custom suit their needs and objectives.  Investment Advisory Services offered through Global Financial Private Capital, LLC, an SEC Registered Investment Advisor.

The information contained in this material is provided by third parties and has been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions.

If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference. 

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