Watching the Markets with Interest

In March, the Federal Reserve decided to reign in its plan for raising rates this year, reducing the expected number of rate increases from four to two.

The Federal Open Market Committee came away from its most recent meeting projecting an interest rate hike of .50 percent, down from the original projection of 1 percent. According to the article’s author, the Fed is waiting for tighter credit spreads and higher inflation expectations before making additional increases.

In the short term, we believe this news could be good for the bond market, permitting income investors an attractive entry point to invest at potentially higher yields. In the domestic credit market, longer maturities in investment-grade corporate bonds offer attractive spreads, supported by both corporate fundamentals and the Fed policy.

Despite the fact that manufacturing in the U.S. has experienced a downward slide in employment numbers, it produces approximately 65 percent of S&P 500 earnings. There are signs that U.S. manufacturing output is growing thanks to domestic demand, touting 3.3 percent growth over the past year. It is our belief that further growth, low unemployment and inflation near the 2 percent target could prove to be a catalyst for the Federal Reserve to move interest rates higher.

For more information on how the latest market trends may impact your retirement income strategy, feel free to give us a call.

[CLICK HERE to read the article, “Looking for yield in all the right places: A post-FOMC playbook” from Columbia Threadneedle, March 21, 2016.]

[CLICK HERE to read the article, “Rumors of the industrial sector’s demise are greatly exaggerated” from Columbia Threadneedle, March 28, 2016.]

We believe markets like certainty, but that’s something we lack in abundance thanks to this topsy-turvy election year. Oil prices continue to fall, and the only certainty is that they can’t keep falling forever.

In the fixed income market, many portfolio managers are recommending that investors resist chasing yield, diversify their holdings and seek out solid, risk-adjusted returns. According to the  article, “5 Rules for Avoiding Bond Portfolio Purgatory”, “Consistency of results is far more important than absolute returns in any given year.”

View the provided link to read the article, “5 Rules for Avoiding Bond Portfolio Purgatory” from Forbes, March 23, 2016: http://www.forbes.com/sites/investor/2016/03/23/5-rules-for-avoiding-bond-portfolio-purgatory/#1d9a5fe97029

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.

This material has been prepared for our firm and contains general information to help you understand basic financial planning strategies that may help you work towards your financial goals. Please understand that I cannot make any promises or guarantees that you will accomplish such goals.  All investments are subject to risk including the complete loss of principal.

Throughout, we may generally discuss different financial vehicles; however, nothing contained herein should be construed as a recommendation to buy or sell any financial vehicle, nor should it be used to make decisions about your investments.

The information contained in this material has been obtained from third party 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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Longer Lifespans Translating to Change of Scenery

Men may now be living longer than ever, but, from a location standpoint, retirees are doing anything but staying put.

Women still live longer than men, but the gap has narrowed, as the lifespan of males has increased consistently over the past few decades. This means the chances are now greater that a married woman will spend more time in retirement with her spouse than as a widow.

Retirees are making the most of their time together by branching out to new territory. It used to be that people up north braved formidable winters throughout their working lives, then retired to Florida or Arizona. Now, there are spots all over the country that attract retirees with affordable living options, in addition to moderate year-round temperatures.

[CLICK HERE to read the article, “Fewer Retirees are Living Alone” from U.S. News & World Report, Feb. 19, 2016.]

[CLICK HERE to read the article, “Americans less prepared for longer lives” from Palo Alto Online, March 4, 2016.]

Wyoming has become a trendy destination for retirees seeking low taxes, good weather, soothing hot springs and a low crime rate -- not to mention attracting the grandchildren with trips to Yellowstone and Grand Teton national parks.

On the other side of the country, retirees over the age of 60 in Columbia, South Carolina, can take free classes at the University of South Carolina. Housing is also affordable, costing a retiree with a paid-off mortgage an average of $367 a month.

[CLICK HERE to read the article, “The 10 Best States for Retirement” from Fox Business, March 1, 2016.]

That’s not bad, considering the average Social Security benefit for retired workers was $1,335 per month in 2015. With a well-thought-out retirement income strategy, you could live comfortably. Having time to enjoy retirement with a spouse is great, as is the ability to travel the country together, but couples should still have a contingency retirement income plan for whichever spouse lives longer.

One study concluded that, despite the smaller gap between genders, about half of women over age 65 will still spend at least 10 years without a spouse. We make a point of talking about the potential for this scenario with all of our clients. If you’d like to learn more about retirement income strategies that may be suitable for you, please give us a call.

  

[CLICK HERE to read the article, “Social Security Basic Facts” from Social Security Administration, Oct. 13, 2015.]

[CLICK HERE to read the article, “10 Best Places to Retire on Social Security Alone” from U.S. News & World Report, Oct. 14, 2014.]

The U.S. Census Department recently released data showing that for people age 55 and older, housing is their greatest expense. It’s important to have a plan to reduce this expense once you’re retired, especially since -- at later ages -- health care expenses are likely to increase.

Perhaps the most influential factor in retirement today, and certainly in the future, is our longer life expectancy. It’s one thing to talk about longevity in statistical terms, but it’s far more important that we look at this reality up close and personal and create a strategy for it.

[CLICK HERE to read the article, “A closer look at spending patterns of older Americans” from U.S. Bureau of Labor Statistics, March 3, 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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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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New Year a Good Time for New Approach

We frequently resolve to reinvent ourselves in the New Year — exercise more, eat healthier, read more or save more.

This concept of reinvention carries over to several aspects of the financial world as well, both personally and in businesses.

At a certain age, it’s common for people to put their materialistic desires behind them and focus on a more personal lifestyle. We grow up learning to want things, but after our income level reaches a comfortable level, we reflect on whether we have what we really want. At that point, our perspective can change.

If we can help you refocus your financial situation to match the type of lifestyle you want to lead going forward, we’re here for you.

[CLICK HERE to read the article, “Minimalist Living: When a Lot Less Is More,” from Time, March 15, 2015.]

[CLICK HERE to read the news release, “What Psychology Says About Materialism and the Holidays,” from the American Psychological Association, Dec. 16, 2014.]

Companies often find themselves needing to reinvent as a result of rapidly changing surroundings. Not long ago, Yahoo and Barnes & Noble were industry leaders. But, as new technology and competitors emerge, a period of poor sales or stock performance can put once-successful business models in need of a shakeup.

[CLICK HERE to read the article, “Is It Too Late to Reinvent Yahoo?” from Knowledge@Wharton, Jan. 4, 2016.]

[CLICK HERE to read the article, “How Can Barnes & Noble Avoid Borders’ Fate?” from Knowledge@Wharton, Dec. 18, 2015.]

An alternative method of reinvention is simply changing the impression presented to consumers through a rebranding. This could mean a new logo, a new look for brick and mortar stores, a new look for the website; basically good branding means creating a cohesive look across all customer touchpoints.

Does a new logo mean the service or product has changed? Perhaps. Sometimes companies rebrand to reflect changes, other times it’s just a new update to their look. While a fresh, new look could attract new customers in the short-term, if the product hasn’t improved, it won’t be long before it’s time for another overhaul.

[CLICK HERE to read the article, “When’s the right time to reinvent your brand with a new logo?” from W.P. Carey School of Business, Arizona State University, Jan. 4, 2016.]

[CLICK HERE to read the article, “Three ways Fortune changed in 2015,” from Fortune, Jan. 4, 2016.]

[CLICK HERE to read the article, “Goodbye, Moto(rola): Iconic brand name to be phased out,” from CNET, Jan. 7, 2016.]

The same can be true when it comes to reinventing our own situation. Sometimes we just “rebrand” ourselves, informing friends and family that we’ve joined a gym or started shopping at Whole Foods.

Truly reinventing ourselves requires commitment and discipline. We can’t just say we’ve made a change, we have to take the often painstaking steps to get there. If any of your reinvention plans involve your financial situation, remember that we’re here to help you develop a strategy and stick to it.

We are an independent firm helping individuals create retirement strategies using a variety of insurance 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. 

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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Brain Power Translates to Staying Power

We keep hearing about how life expectancy has increased, and today’s retirees are living longer than ever. However, longevity behooves that we (1) take measures to retain good health and mental acumen as we get older and (2) develop a long-term financial strategy to provide for ourselves and our loved ones in retirement.

We can help you with the latter, and here are some new studies that may help you with the former.

Recent research has found that the brain can actually grow new nerve cells through a process called neurogenesis. The hippocampus section of the brain — which is responsible for learning, memory, mood and emotion — generates up to 700 new neurons per day. In fact, scientists have discovered a clear link that patients given anti-depressants generate a higher level of new neurons, which are directly responsible for improving mood.

While neuron production tends to decrease as we age, there are factors we can control to help increase production: learning, physical activity and specific factors related to diet, such as restricted caloric intake, intermittent fasting, consuming flavonoids (found in blueberries and dark chocolate) and omega-3 fatty acids (found in salmon). Soft foods (as opposed to crunchy foods) also have been found to promote neurogenesis.

[CLICK HERE to view the Ted Talk, “You Can Grow New Brain Cells. Here’s How,” from BCG Perspectives, October 2015.]

Other studies have demonstrated positive brain changes associated with higher levels of daily physical activity and fitness. In addition to keeping muscles and joints fit, exercise also improves oxygen circulation and the nerve processes that improve memory and brain functions as people age.

Scientists say it doesn’t take much; simply that we continue to be active throughout the day. For example, get up and move around every hour that you’re awake.

[CLICK HERE to read the article, “Getting closer to understanding how exercise keeps brains young,” from Harvard Health Publications, Sept. 4, 2015.]

Another phenomenon that impedes brain functionality is sleep deprivation, which is common among adults at every age. A sleep-deprived brain thinks slower, reacts slower and is prone to poorer decision making. Furthermore, lack of sleep can impact mood, and people who consistently lose sleep are more likely to experience depression.

[CLICK HERE to read the article, “Sleep and Melatonin,” from National Sleep Foundation, 2015.]

[CLICK HERE to read the article, “Sleep and Sound,” from National Sleep Foundation, 2015.]

[CLICK HERE to read the article, “Have Insomnia? Researchers Identify Brain Circuit Responsible for Wakefulness, Sleep,” from MedicalDaily.com, Dec. 26, 2015.]

Finally, you can help optimize your brainpower by cutting down on refined sugar consumption. While it’s well known sweets aren’t good for our waistlines, they can also be detrimental to mental sharpness and the ability to get a good night’s sleep.

Let’s face it: If we’re going to live a long time, we want to maintain a high quality of life. The decisions you make regarding health and nutrition are in your hands, but if you ever have questions about keeping your finances in good shape, feel free to give us a call.

[CLICK HERE to read the article, “How Giving up Refined Sugar Changed My Brain,” from Fast Company, Sept. 1, 2015.]

We are an independent firm helping individuals create retirement strategies using a variety of insurance 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.

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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