The Anatomy of an Index The S&P 500 represents a large portion of the value of the U.S. equity market Prepared by: Nate Lewis Did you know that nearly $10 trillion in assets are benchmarked to the Standard & Poor’s 500 Composite Index, including about $3.5 trillion in index assets?1 The S&P 500 is ubiquitous. It is constantly referenced in financial and non-financial media, and we may compare the return of our own investments to its performance. As the index represents approximately 80% of the value of the U.S. equity market (or about 80% of market capitalization), it may be

2018 Economic Review In this 2018 recap: a strong economy, a volatile year for equities and commodities, a trade battle between the U.S. and China, a gradual path upward for the federal funds rate, and slower growth overseas. Provided by: Nate Lewis THE YEAR IN BRIEF Investors will remember 2018 as a year of significant ups and downs. Wall Street ended the year on a down note, with the fourth quarter leaving the S&P 500 in the red: the index retreated 6.24% in 2018. The Federal Reserve made a series of quarter-point interest rate hikes, the United States and China

Monthly Economic Update January 2019 In this month’s recap: equity and commodity markets experience major losses, the Fed sends a hawkish message, home sales improve, and the economy maintains its momentum. THE MONTH IN BRIEF December 2018 will be remembered for its volatility and its challenges. The S&P 500 flirted with bear market territory, dropping 10.16% for the month. Appetite for risk declined here and abroad in the face of tariffs, concerns about the Federal Reserve raising interest rates too quickly, a federal government shutdown, and questions about the Brexit. It was also a difficult month for commodities. In contrast,

Weekly Economic Update 1/7/2019 In this week’s recap: an impressive jobs report, a disappointing factory activity index, a slight recovery for oil, and some tailwinds on Wall Street. 2018 Ended with a hiring surge The latest Department of Labor jobs report suggests an economy with plenty of forward momentum. Employers added 312,000 net new jobs in December, the most in ten months. The main jobless rate rose 0.2% to 3.9% as more Americans entered the labor force; the U-6 rate, measuring underemployment, held at 7.6%. Last month, wages were improving at a rate of 3.2% per year, an increase of

An Executor Checklist The steps you may need to take to fulfill a major responsibility. If you are an executor to an estate, you must carry out your duties responsibly. Fulfilling these duties is not only a measure of your ability, but a measure of your character. You can approach these tasks methodically. In fact, it is probably best if you do. Here are the common steps required of executors, before and after the death of a testator. What should you do now, before having to assume the role of executor? The most important thing you can do is to

Stocks & Presidential Elections What does history tell us – and should we value it? As an investor, you know that past performance is no guarantee of future success. Expanding that truth, history has no bearing on the future of Wall Street. That said, stock market historians have repeatedly analyzed market behavior in presidential election years, and what stocks do when different parties hold the reins of power in Washington. They have noticed some interesting patterns through the years, which may or may not prove true for 2020 or for any other election year down the line. Do stocks really

Your Year-End Financial Checklist Seven aspects of your financial life to review as the year draws to a close. The end of a year makes us think about last-minute things we need to address and good habits we want to start keeping. To that end, here are seven aspects of your financial life to think about as this year leads into the next.. Your investments. Review your approach to investing and make sure it suits your objectives. Look over your portfolio positions and revisit your asset allocation.    Your retirement planning strategy. Does it seem as practical as it did

Weekly Economic Update 12/17/2018 In this week’s recap: inflation moderates, oil prices head south, and equities have a tough week. As FUEL GROWS CHEAPER, INFLATION BECOMES TAMER Last week, the latest Consumer Price Index arrived, showing no move for headline inflation in November and a 0.2% core inflation increase. That precisely matched the consensus forecast of economists polled by Reuters. What held the headline CPI in check last month? You can credit a sudden drop in gas prices, which fell 4.2%. Annualized inflation declined to 2.2%. Overall producer prices only rose 0.1% last month, compared to an October ascent of

A Retirement Fact Sheet Some specifics about the “second act.” Does your vision of retirement align with the facts? Here are some noteworthy financial and lifestyle facts about life after 50 that might surprise you. Up to 85% of a retiree’s Social Security income can be taxed. Some retirees are taken aback when they discover this. In addition to the Internal Revenue Service, 13 states levy taxes on some or all Social Security retirement benefits: Colorado, Connecticut, Kansas, Minnesota, Missouri, Montana, Nebraska, New Mexico, North Dakota, Rhode Island, Utah, Vermont, and West Virginia. (It is worth mentioning that the I.R.S.

Why Do You Need a Will? It may not sound enticing, but creating a will puts power in your hands. According to the global analytics firm Gallup, only about 44% of Americans have created a will. This finding may not surprise you. After all, no one wants to be reminded of their mortality or dwell on what might happen upon their death, so writing a last will and testament is seldom prioritized on the to-do list of a Millennial or Gen Xer. What may surprise you, though, is the statistic cited by personal finance website The Balance: around 35% of

Tax Scams & Schemes The “dirty dozen” favored by criminals & cheats. Year after year, criminals try to scam certain taxpayers. Year after year, certain taxpayers resort to schemes in an effort to put one over on the Internal Revenue Service (I.R.S.). These cons occur year-round, not just during tax season. In response to their frequency, the I.R.S. has listed the 12 biggest offenses – scams that you should recognize, schemes that warrant penalties and/or punishment.    Phishing. If you get an unsolicited email claiming to be from the I.R.S., it is a scam. The I.R.S. never reaches out via email,

Weekly Economic Update 12/3/2018 In this week’s recap: stocks soar, the USMCA is signed, households spend more, and two housing market indicators fall short. COMMENTS FROM JEROME POWELL INSPIRE A RALLY Wall Street liked what it heard from Federal Reserve chairman Jerome Powell last week. While speaking Wednesday to an audience in New York, Powell stated that interest rates “remain just below the broad range of estimates of the level that would be neutral for the economy – that is, neither speeding up nor slowing down growth.” He also noted there was “no preset policy path” for raising interest rates

Tax Considerations for Retirees Are you aware of them? The federal government offers some major tax breaks for older Americans. Some of these perks deserve more publicity than they receive.        If you are 65 or older, your standard deduction is $1,300 larger. Make that $1,600 if you are unmarried. Thanks to the passage of the Tax Cuts & Jobs Act, the 2018 standard deduction for an individual taxpayer at least 65 years of age is a whopping $13,600, more than double what it was in 2017. (If you are someone else’s dependent, your standard deduction is much less.)1 You

Ways to Ease the Cost of College A look at grants, scholarships, 529 plans, and other methods. How much could a college education cost in the 2030s? You may want to take a deep breath and sit down before reading the next paragraph   A MassMutual analysis projects that four years of tuition, room, and board at a private college will cost nearly $369,000 in 2031. An article at CNBC offers a slightly cheaper estimate, putting the total expense at $303,000 for a freshman setting foot on campus in 2036. (Today, the cost of four years at a private university is

Social Security Gets Its Biggest Boost in Years Seniors will see their retirement benefits increase by an average of 2.8% in 2019. Social Security will soon give seniors their largest “raise” since 2012. In view of inflation, the Social Security Administration has authorized a 2.8% increase for retirement benefits in 2019.1 This is especially welcome, as annual Social Security cost-of-living adjustments, or COLAs, have been irregular in recent years. There were no COLAs at all in 2010, 2011, and 2016, and the 2017 COLA was 0.3%. This marks the second year in a row in which the COLA has been

Staying Out of Debt Once You Get Out of Debt As you reduce your liabilities, embrace the behaviors that may improve your balance sheet. Paying off a major debt produces a sense of relief. You can celebrate a financial milestone; you can “pay yourself first” to greater degree and direct more money toward your dreams and your financial future rather than your creditors. Once you get out of excessive consumer debt, the last thing you want to do is fall right back in. What steps can you take to reduce that possibility, and what missteps should you avoid making?   Step

Weekly Economic Update 11/19/2018 In this week’s recap: a bit more inflation pressure, a big fall retail sales gain, another setback for light sweet crude, and a down week on Wall Street. IN OCTOBER, INFLATION JUMPED THE MOST SINCE JANUARY The Consumer Price Index rose 0.3% last month, according to the Bureau of Labor Statistics. This was the largest monthly gain for the headline CPI since its 0.5% move in the first month of the year. A 3.0% leap in gasoline prices played a significant role. Core consumer inflation, which does not include volatile food and energy costs, increased by

Weekly Economic Update 9/24/2018 BLUE CHIPS HIT A 2018 HIGH On Thursday, the Dow Jones Industrial Average saw its best close since January. Friday took the index even higher, to another record settlement of 26,743.50. That capped a 2.25% weekly advance. The Dow was not the only major benchmark shattering records last week. The S&P 500 also settled at a historic peak Thursday before drifting slightly lower to 2,929.67 a day later; in five days, it rose 0.85%. For the Nasdaq Composite, the story was different: it declined 0.29% last week to 7,986.96.1,2 AUGUST WAS A FLAT MONTH FOR HOME

The IRA and the 401(k) Comparing their features, merits, and demerits. Taxes are deferred on money held within IRAs and 401(k)s. That opens the door for tax-free compounding of those invested dollars – a major plus for any retirement saver.1    IRAs and 401(k)s also offer you another big tax break. It varies depending on whether the account is traditional or Roth in nature. When you have a traditional IRA or 401(k), your account contributions are tax deductible, but when you eventually withdraw the money for retirement, it will be taxed as regular income. When you have a Roth IRA

Discover the 403(b) This retirement plan allows teachers & employees of non-profits to invest for their futures.  Does your spouse contribute to a 401(k)? You are probably eligible for a retirement plan that can help you save and invest for retirement in the same way – a 403(b). 403(b) plans actually predate 401(k)s. They first appeared in the 1950s. School districts and non-profit organizations commonly offer these retirement savings vehicles to their employees.1  Contributions to most 403(b)s are 100% tax deductible. Typically, you just defer a small percentage of your salary into these plans per paycheck, prior to taxes being