Emphasis in retirement is generally placed on financial planning, which is critically important, but doesn’t address the potential void of emotional, psychological, intellectual and physical adjustments. Serious attention to these non-financial aspects is important for those who are considering retirement, wanting to revitalize their current retirement and/or are a partner in a retirement relationship.
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When economists studied the Great Depression after the 1930s, one of the things that was cited as worsening the economic decline and prolonging the recession was the Smoot-Hawley tariffs. This protectionist trade policy was signed into law in 1930 and raised the tariffs on over 20,000 imported goods to the U.S. Despite nearly 90 years passing since then, whenever the term “trade war” surfaces in the media, folks immediately cite the mistakes from the 1930s and warn against repeating them.
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According to the Pew Research Center, 1 in 7 middle aged adults is providing financial support to both aging parents and their children. The term “Sandwich Generation” is used to describe people between their late 30’s through their early 50’s who are feeling the financial pressure of supporting their aging parents, supporting their children, and saving for their own retirement. Read More..
Tax-deferred retirement accounts allow investments to compound free of taxes, which can make them an exceptional investment vehicle. One of the downsides is the fact that there are annual contribution limits on these accounts. The IRS is in charge of determining the contribution limits to each of these types of accounts. In determining these limits, they take into account several factors including your income. They announce the limits for the upcoming year annually, which may or may not change. Below are the 2018 contribution limits for some of the various retirement accounts.
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The last year (2017) in the stock market will go down as one of the least volatile years on record. The largest pullback in stocks during the year was a scant -3%. Experienced investors know that historically the stock market has experienced yearly pullbacks in the neighborhood of double-digits. That made last year’s action in the market feel eerily calm to many portfolio managers, and begs the question, will 2018 be the year that investors see a pickup in volatility?
The answer is almost certainly yes, given that 2017 was such an anomaly in terms of low volatility. But it remains to be seen whether we will see just a mild pickup in volatility or something larger. The other element that is more difficult to predict is what will be the catalyst for any pullback. A sharp rise in bond yields? A geopolitical event? A policy shift in China? One never knows until it is upon us, but investors should not expect a repeat of last year’s ultra-low levels of market volatility.
The Senate and the House have both released their proposed versions for tax reform. While they work to iron out the differences, consensus has it that the bill will probably take effect on January 1, 2018, even if it has to be made retroactive at some point during 2018. Certain opportunities are poised to disappear next year and action can be taken by December 31st of this year to take advantage of the current tax laws. Year-end tax moves will likely be more important this year as the government is trying to implement new tax laws for 2018. In preparation for the potential passing of the bill, we have outlined a couple ideas to consider before year end.
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Talking about money is not something all parents are comfortable with. For some people it can be too complicated. For others, too scary. Some families simply just do not have the time to teach their children about money. According to a recent T. Rowe Price survey, 69 percent of parents have some level of reluctance when it comes to talking to their children about money. However, those parents that are able to get over the hurdle and have these conversations with their children are much more likely to have children that are financially smart. As a parent, you can be part of this solution. Budgeting, earning, saving, spending, and investing are broad concepts that you can teach your children at a young age to help ensure they are money savvy throughout their lives.
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One of the questions we hear in almost every client meeting of late is, “How can the market be going up when things are so bad out there?” Rather than try to identify and debate each item that could be referred to as ‘bad’, we think it would be more instructive to revisit market dynamics and the true drivers of stock prices that investment managers refer to when they talk about the strong underlying fundamentals behind this market.
