Debt Should Retire When You Do

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These days, having a credit card is practically a necessity, even when you are retired. It’s hard to do things like buy airline tickets, rent a car, or place an order online without one. And, while monitoring your credit card use is important anytime, making sure you avoid credit card mistakes that could affect your finances is essential once you retire.

It’s a Credit Card, Not a Paycheck

Although it sometimes may be difficult to live on a fixed amount, using credit to supplement your income will only make it harder to live within your means. Avoid using your card to pay for groceries or other necessities unless you can pay the balance in full when the bill comes due. If you can’t pay the balance and continue to charge purchases, you risk having a larger credit card bill than you’re comfortably able to pay each month. And you could be incurring hefty finance charges on the unpaid balance, making it even harder to reduce your debt.

Pay Attention to Features

Think about how you intend to use the card. Cards that earn travel or other rewards may be appropriate if you’re disciplined and pay off your card balance each month. But make sure any fees for a rewards card don’t outweigh the benefits. If there’s a strong possibility that you’ll carry a balance on a high-rate card, forget the rewards and look for a card with a low interest rate.

Nurture Your Credit Score

You’ll get the best deals on credit cards if you have a high credit score. Don’t hurt your score by paying bills late or getting into too much debt.

If You Do Have Debt

If you still have credit card debt as you begin retirement, make sure you have a plan for paying it off. Once it’s gone, using credit responsibly will help keep your finances on track.

Required Attribution
Because of the possibility of human or mechanical error by DST Systems, Inc. or its sources, neither DST Systems, Inc. nor its sources guarantees the accuracy, adequacy, completeness or availability of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. In no event shall DST Systems, Inc. be liable for any indirect, special or consequential damages in connection with subscriber’s or others’ use of the content. 
AR Tracking Number: 1-909497 Expiration Date: 11/2020 

Common Investment Pitfalls and How to Avoid Them

Only about 17% of American workers say they are “very confident” they will have enough money to live comfortably throughout retirement. (1) To help reduce such uncertainty in your life, consider these five common investment pitfalls — and how you might avoid them.

Mistake #1: Waiting to Maximize Your Contributions The sooner you start contributing the maximum amount allowed by your employer-sponsored retirement plan, the better your chances for building a significant savings cushion. By starting early, you allow more time for your contributions — and potential earnings — to compound, or build upon themselves, on a tax-deferred basis.

Mistake #2: Ignoring Specific Financial Goals It is difficult to create an effective investment plan without first targeting a specific dollar amount and recognizing how much time you have to pursue that goal. To enjoy the same quality of life in retirement that you have become accustomed to during your prime earning years, you may need the equivalent of up to 80% of your final working year’s salary for each year of retirement.

Mistake #3: Fearing Stock Volatility It is true that stock investments face a greater risk of short-term price swings than fixed-income investments. However, stocks have historically produced stronger earnings over the long term.(2) In general, the longer your investment time horizon, the more you might consider adding stock funds to your portfolio.

Mistake #4: Timing the Market Some investors try to base investment decisions on daily price swings. But unless you have a crystal ball, “timing the market” could be very risky. A better idea might be to buy and hold investments for several years.

Mistake #5: Failing to Diversify Investing in just one fund or asset class could subject your investment portfolio to unnecessary risk. Spreading your money over a well-chosen mix of investments may help reduce the potential for loss during periods of market volatility. Diversification may offset losses in any one investment or asset category by taking advantage of possible gains elsewhere. (3) Now that you are aware of these five common investment errors, consider yourself lucky: You are ready to potentially benefit from other people’s experiences — without making the same mistakes.

 

 

Source/Disclaimer:
(1)Source: Employee Benefit Research Institute, “The 2018 Retirement Confidence Survey,” March 2018.
(2) Source: DST Stsyems, Inc. Stocks are represented by total returns from Standard & Poor’s Composite Index of 500 Stocks, an unmanaged index generally considered representative of the U.S. stock market. Fixed-income investments are represented by annual total returns of long-term (10+ years) Treasury bonds. Indexes do not take into account the fees and expenses associated with investing, and individuals cannot invest in any index. Past performance is no guarantee of future results. With any investment, it is possible to lose money.
(3) Diversification does not assure a profit or protect against a loss in any market.
Required Attribution:
Because of the possibility of human or mechanical error by DST Systems, Inc. or its sources, neither DST Systems, Inc. nor its sources guarantees the accuracy, adequacy, completeness or availability of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. In no event shall DST Systems, Inc. be liable for any indirect, special or consequential damages in connection with subscriber’s or others’ use of the content. 
AR Tracking Number: 1-909500 Expiration Date: 11/2020 

JANUARY 2020 CLIENT LETTER

January 2, 2020

Dear Valued Investor:

Happy New Year! What a difference a year makes. One year ago the stock market was plunging and came perilously close to ending what has become the longest bull market ever recorded. In December 2018, dropping stocks were suggesting an increased risk that a recession, or market crisis, might be on the horizon. Confidence in investing fundamentals coupled with attractive stock valuations helped keep a focus on long-term investing objectives in the face of short-term volatility.

One year later with 20/20 hindsight, what appeared to be a bullish forecast for stocks may have been too conservative, and now we’re asking if stocks have come too far, too fast. December 2019’s stock market environment has been in some ways the opposite of December 2018’s. After a strong rally that has lifted stock valuations, the question now is whether investing fundamentals can to continue to support 2019’s gains throughout 2020.

Stock market fundamentals have improved significantly over the past year. We’ve received clarity on the biggest market uncertainties: U.S.-China trade relations, the Federal Reserve (Fed) pivoting from rate hikes to rate cuts, and the United Kingdom’s exit from the European Union (Brexit). We’ve also seen a leadership transition at the European Central Bank and more production cuts by Saudi Arabia-led OPEC to help stabilize oil prices. These actions plus reduced trade tensions in other key international economies could be viewed as evidence that economic growth outside the United States has stabilized and may even be starting to pick up a bit, although it is not assured.

Investors have priced in a lot of this good news, and it’s possible that some potential 2020 gains have been pulled forward into late 2019. Stocks may need to be repriced over the next several months as investors wait for the economy and corporations to deliver against pricing, and that wait could be uncomfortable at times. Corporate earnings growth will likely be the driver of stock market gains, but that still may depend on more progress in trade negotiations. Negotiations on “phase two” of the U.S.-China trade talks could become bumpy, and that could lead to additional turbulence in the stock markets. Inflation could also pick up and trigger renewed fears of Fed rate hikes, although a slight increase in inflation is a sign of a healthy economy. Fallout from the impeachment, international economic data in decline, and the potential for a highly charged U.S. election also could lead to increased market uncertainty this year.

While the strong market performance of 2019 may limit the magnitude of potential market advances in 2020, stock market gains are still possible this year. A Fed committed to keeping interest rates at current levels and progress on trade can improve prospects for business investment and productivity growth. To help prepare for what may be a dynamic—and possibly volatile—year ahead, please read LPL Research’s Outlook 2020: Bringing Markets Into Focus.

Best wishes for a healthy and prosperous New Year, and please contact me if you have any questions.

Sincerely,

Wayne Rigney

 

 

Important Information

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance referenced is historical and is no guarantee of future results.

The use of Stocks and Markets herein are referencing corresponding indexes, unless otherwise noted. All indexes are unmanaged and cannot be invested into directly. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment.

Economic forecasts set forth may not develop as predicted.

All data is provided as of December 31, 2019.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

This Research material was prepared by LPL Financial, LLC. All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.

Tracking # 1-931723 (Exp. 01/21)

December 2019 Client Letter

December 3, 2019

Dear Valued Investor:

Hindsight is 20/20, but finding clarity in future uncertainty can be fuzzy. 2019 has been a very rewarding year for investors. One year ago after publishing Outlook 2019 we were all tested with market volatility, and that’s a reminder that we need to continue to be prepared for uncertainty in the markets.

As we look forward to the year 2020 and a new decade, some key trends and market signals will be important to watch. These include progress on U.S.-China trade discussions, slowing global growth, an encouraging outlook from corporate America, and continued strength in consumer spending. To help keep it all in focus, LPL Research Outlook 2020: Bringing Markets Into Focus offers investment insights and market guidance through the end of 2020.

As Outlook 2020 explains, progress on trade remains central to growth projections. LPL Research expects 1.75% U.S. gross domestic product (GDP) growth in 2020, which reflects the potential for continued trade and geopolitical uncertainties amid the expected gradual slowing of the economy at this point in the economic cycle.

The bond market also is expected to show a modest increase in longer-term yields, supported by continued flexibility by the Federal Reserve in setting interest rates. LPL Research’s year-end 2020 forecast for the 10-year U.S. Treasury yield is a range of 2–2.25%.

Expectations for better corporate earnings growth in 2020, along with continued economic growth in the United States, could support stocks at current valuations. After the strong market gains thus far in 2019, corporate earnings may be the primary driver for stocks next year. The LPL Research team calculates that the S&P 500 could increase by mid-single-digits, consistent with profit gains, by the end of 2020, and they believe mild inflation and still-low interest rates will support these valuations. At the same time, we are mindful of our position in this extended business cycle, and we’ll be on the lookout for signs of moderation.

Together we will continue to monitor the impact of trade negotiations, the upcoming elections, and keep an eye on developments around the world. The LPL Research Outlook 2020 is here to help, bringing some clarity to a complex investing environment and providing insightful commentary to support investment decisions during the year ahead.

If you have any questions, please feel free to contact me.

Sincerely,

Wayne Rigney

 

 

IMPORTANT DISCLOSURES

 

Our 2020 year-end fair value target range for the S&P 500 is 3,250–3,300. We base this year-end target on a trailing price-to-earnings ratio (P/E) of 18.75, which we multiply by our 2020 S&P 500 EPS forecast of $175. We believe mild inflation and still-low interest rates support these valuations. Please see the full Outlook 2020 publication for additional description and disclosure.

This material is for general information only and is not intended to provide specific advice or recommendations for any individual. The economic forecasts set forth may not develop as predicted.

The Standard & Poor’s (S&P) 500 Index tracks the performance of 500 widely held, large-capitalization US stocks. All indexes are unmanaged and cannot be invested into directly.

The PE ratio (price-to-earnings ratio) is a measure of the price paid for a share relative to the annual net income or profit earned by the firm per share. It is a financial ratio used for valuation: a higher PE ratio means that investors are paying more for each unit of net income, so the stock is more expensive compared to one with lower PE ratio.

Earnings per share (EPS) is the portion of a company’s profit allocated to each outstanding share of common stock. EPS serves as an indicator of a company’s profitability. Earnings per share is generally considered to be the single most important variable in determining a share’s price. It is also a major component used to calculate the price-to-earnings valuation ratio.

Gross Domestic Product (GDP) is the monetary value of all the finished goods and services produced within a country’s borders in a specific time period, though GDP is usually calculated on an annual basis. It includes all of private and public consumption, government outlays, investments and exports less imports that occur within a defined territory.

This research material has been prepared by LPL Financial LLC.  Tracking # 1-921238

 

Outlook 2020

November 2019 Client Letter

November 7, 2019

Dear Valued Investor:

Turning the calendar from October to November brought more than trick-or-treaters, pumpkins, and leaves to rake. It also brought a wave of important economic updates that delivered more treats than tricks and helped the stock markets reach new highs.

Those new highs may be causing you to feel a bit wary, however, wondering if the end is nearing for what is now the longest bull market ever recorded. Should new highs be feared or embraced? Since 1980 the S&P 500 Index historically has generated above-average returns one year after reaching a new high. New highs have been a normal by-product of bull markets, and we should expect to see more.

There are several reasons to expect this bull market may deliver more new highs in the months ahead. Overall, the U.S. economy remains on solid ground with no sign of imminent recession. Gross domestic product for the third quarter came in better than expected despite businesses’ weak capital investment related to the U.S.-China trade conflict. The consumer remains the anchor of the U.S. economy, as shown in recent strong consumer spending data. Job growth in October was solid, even when considering the General Motors strike (which is over), and wages continued to rise.

Recent trade headlines also reflect encouraging progress. President Trump and China President Xi likely will sign a preliminary trade agreement within the next month or so. The most contentious issues will need to be worked out in future negotiations, but any de-escalation of the current trade tensions will be welcome. Resolving the trade dispute may encourage companies to invest more, which could drive stronger economic growth and corporate profits and help push stocks higher.

Doing its part, the Federal Reserve (Fed) gave investors what they were hoping for and cut interest rates for the third time this year. Stocks historically have responded well one year after cuts that were also characterized as a “gradual mid-cycle rate adjustment.”

We are entering what historically has been the best performing six months of the year for stocks. When we add that positive seasonal factor to the overall good health of the U.S. economy, support from the Fed, and progress on a trade agreement, it appears this bull market may have more left in the tank. At the same time, we cannot dismiss potential risks to markets, most notably the possible unraveling of the U.S.-China trade pact, lackluster economic growth in Europe and Japan, stalled corporate profit growth, and the potentially contentious upcoming U.S. presidential election campaign. After a relatively calm and steady stock market advance this year, a pickup in market volatility would be totally normal.

We should continue to watch for signs of excesses in the economy that could lead to a recession and bring this record bull market to an end. For now, there don’t appear to be any worrisome cracks in a strong economic foundation, and the backdrop for stocks appears to remain favorable.

Please contact me if you have any questions, and have a very happy Thanksgiving.

Sincerely,

Wayne Rigney

 

________________________________

 

Important Information

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance referenced is historical and is no guarantee of future results.

The use of Stocks and Markets herein are referencing corresponding indexes, unless otherwise noted. All indexes are unmanaged and cannot be invested into directly. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment.

Economic forecasts set forth may not develop as predicted.

All data is provided as of November 1, 2019.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

This Research material was prepared by LPL Financial, LLC. All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.

October 2019 Client Letter

October 3, 2019

Dear Valued Investor:

Summer has turned to fall, and there’s already a little chill in the air. Three-quarters of the year is behind us now, and both stock and bond markets have had a strong year so far, although we expect to see regular—but normal— bouts of volatility as we progress through the fourth quarter. In its first week October has lived up to its reputation as a volatile month, but it’s important to keep in mind that October actually has been the third strongest month on average for the S&P 500 Index for the past 20 years. There are several key factors to watch the rest of the year as the weather continues to cool and end-of-the year activities heat up.

Trade and impeachment have garnered a lot of the headlines recently, but behind the scenes the U.S. economy has remained resilient. Economic data has been increasingly beating expectations. The most recent data points to third-quarter economic growth that’s consistent with the long-term trend of the current expansion, which is now more than a decade long.

Trade headlines have improved in recent weeks. U.S. and China negotiators are scheduled to meet October 10, and the Chinese recently began purchasing U.S. soybeans and pork products again. Reports that the United States would curb U.S. investment in China surfaced and were quickly refuted by the White House. Finally, with the 70th anniversary of the People’s Republic of China behind us, China’s leadership may be in a better position to strike some sort of a trade deal. Even a limited agreement could help shore up business and investor confidence.

While the impeachment process will receive a lot of press attention, it is not expected to have much impact on the economy or markets. The main risk is that the political discourse may harm investor confidence.

Recession fears have heightened recently following a soft September report on U.S. manufacturing from the Institute for Supply Management. Domestic manufacturers continue to struggle with slowing international growth, tariffs, and a strong U.S. dollar. It’s important to note, however, that manufacturing comprises just 12% of the U.S. economy based on gross domestic product, while consumer spending contributes nearly 70%. U.S. consumer spending remains in good shape with low unemployment and rising wages.

Overall, fundamentals for the U.S. economy remain favorable despite trade uncertainty and increasing political risk in Washington, D.C. U.S. economic data has been exceeding expectations, and consumers continue to benefit from a solid labor market. With further progress on trade possible in the months ahead and more Federal Reserve rate cuts anticipated, this bull market may have room to run.

Please contact me if you have any questions, and enjoy the autumn weather.

Sincerely,

Wayne Rigney

 

 

______________________________________

Important Information

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance referenced is historical and is no guarantee of future results.

All indexes are unmanaged and cannot be invested into directly. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment.

Economic forecasts set forth may not develop as predicted.

All data is provided as of October 1, 2019.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

This Research material was prepared by LPL Financial, LLC. All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.

Trusteed IRA: Vol 2

Trusteed IRA: Vol. 1

Quick Market Update: Episode 1