For the Week of May 29, 2017

The Markets

Although Friday was the lightest trading day of the year and stocks ended little changed, the S&P 500 and the NASDAQ edged to records. Positive influences included a better-than-expected first-quarter earnings report, continued signs of a steady economy and expectations the Federal Reserve won’t raise rates abruptly. For the week, the Dow rose 1.35 percent to close at 21,080.28. The S&P gained 1.47 percent to finish at 2,415.82, and the NASDAQ climbed 2.08 percent to end the week at 6,210.19.

Source: Morningstar.com. *Past performance is no guarantee of future results. Indexes are unmanaged and cannot be invested into directly. Three- and five-year returns are annualized. The Dow Jones Industrials, MSCI EAFE, Barclays US Agg Bond and S&P, excluding “1 Week” returns, are based on total return, which is a reflection of return to an investor by reinvesting dividends after the deduction of withholding tax. The NASDAQ is based on price return, which is the capital appreciation of the portfolio, excluding income generated by the assets in the portfolio in the form of interest and dividends. (TR) indicates total return. (PR) indicates price return. MSCI EAFE returns stated in U.S. dollars.

Lengthy — The current economic expansion (in its 95^th month) is the third longest U.S. expansion based on data tracked since 1854, i.e., for 163 years (source: National Bureau of Economic Research, BTN Research).

Many Years, No Change — The Social Security payroll tax rate paid by employees has been 6.2 percent since 1990 except for a 2 percent reduction in the rate during the two years of 2011-12 (source: Social Security, BTN Research).

More Taxes — Proposed House legislation (Social Security 2100 Act) by U.S. Rep. John Larsen of Connecticut would increase the Social Security payroll tax rate paid by employees from 6.2 percent to 7.4 percent, to be phased in over 24 years from 2019-2042. Larsen’s plan would also phase out the current $127,000 ceiling on earnings subject to payroll taxes, so all earnings would be taxed by 2047. (source: Social Security Office of the Chief Actuary, BTN Research).

WEEKLY FOCUS – National 529 College Savings Plan Day

May 29 is a nationally designated day to focus on one of the best ways to save for college or continuing education – a 529 College Savings Plan. A 529 plan is an affordable, state-sponsored, tax-advantaged investment vehicle; funds are used to pay for college expenses like tuition, books, required equipment, and room and board.

Federal tax benefits for 529s, which incentivize planning and saving, are more generous than other savings options. Earnings in a 529 can be withdrawn at any time and aren’t taxed when used for qualified expenses at eligible postsecondary institutions. Other savings vehicles such as mutual funds are subject to annual income and capital gains taxes when money is withdrawn. In addition to federal tax savings, some states offer full or partial tax deductions for 529 contributions made by the account owner. Tax deductions could make your own state’s plan attractive. But since you’re allowed to open accounts in other states, consider your options. In some cases, better investment performance of another state’s plan might outweigh the benefits of your state’s tax deduction.

Unlike Roth IRAs and Coverdell Education Savings Accounts, 529 plans have no income or age limits. Anyone can set up, or benefit from, a 529. You can set up an account for a friend, your grandchild or relative, even yourself. The funds can also be used for career enrichment programs, certificates and advanced degrees.

While it’s never too early or late to start saving for college, a big benefit of a 529 comes from the tax-free withdrawal and earnings that build up over time. That’s why opening an account when a child or grandchild is very young makes perfect sense. But it doesn’t mean an older student wouldn’t also benefit from a 529. This could figure into retirement lifestyle and budget planning, especially for an encore career or lifelong learning during retirement.

Opening a 529 account is an investment decision. To find out if opening a 529 is right for you, or for help in choosing the right 529, call our office. We can answer your 529 questions and guide you through the financial planning process.

*The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Morgan Stanley Capital International Europe, Australia and Far East Index (MSCI EAFE Index) is a widely recognized benchmark of non-U.S. stock markets. It is an unmanaged index composed of a sample of companies representative of the market structure of 20 European and Pacific Basin countries and includes reinvestment of all dividends. Barclays Capital Aggregate Bond Index is an unmanaged index comprised of U.S. investment-grade, fixed-rate bond market securities, including government, government agency, corporate and mortgage-backed securities between one and 10 years. Written by Securities America, Copyright May 2017. All rights reserved. Securities offered through Securities America, Inc., Member FINRA/SIPC. SAI#1808210.1

For the Week of May 22, 2017

The Markets

Wall Street saw sharp losses mid-week after reports surfaced that President Trump tried to interfere in the federal investigation of possible coordination between Russia and Trump’s election campaign. Stocks rose Friday but closed down for the week. For the week, the Dow fell 0.32 percent to close at 20,804.84. The S&P lost 0.32 percent to finish at 2,381.73, and the NASDAQ dropped 0.61 percent to end the week at 6,083.70.

Source: Morningstar.com. *Past performance is no guarantee of future results. Indexes are unmanaged and cannot be invested into directly. Three- and five-year returns are annualized. The Dow Jones Industrials, MSCI EAFE, Barclays US Agg Bond and S&P, excluding “1 Week” returns, are based on total return, which is a reflection of return to an investor by reinvesting dividends after the deduction of withholding tax. The NASDAQ is based on price return, which is the capital appreciation of the portfolio, excluding income generated by the assets in the portfolio in the form of interest and dividends. (TR) indicates total return. (PR) indicates price return. MSCI EAFE returns stated in U.S. dollars.

The Young and the Rich — Americans under the age of 35 make up 25 percent of the U.S. population but hold just 5 percent of U.S. wealth. Americans between the ages of 55-64 make up 16 percent of the U.S. population but hold 31 percent of U.S. wealth (source: Federal Reserve Bank of St. Louis, BTN Research).

A Goal of Mine — Of American adults who are not homeowners, 69 percent anticipate they will become a homeowner within the next 10 years (source: Gallup Poll, BTN Research).

Not Enough Shoppers — Fourteen publicly traded U.S. retailers have filed for Chapter 11 bankruptcy protection in 2017. Eighteen retailers filed for bankruptcy protection in 2009 (source: AlixPartners, BTN Research).

WEEKLY FOCUS – Before You Retire…

If you’ve worked, saved and planned for retirement, you may think you can ease up during your final years of work. But there are actually many things to do and consider as you approach the finish line to retirement. Here are a few: 

Get one-time expenses out of the way. You may want to tackle the big house repair or renovation you’ve been planning before you quit working. If costs are more than expected, you can work a few extra months to cover them.

Review your employee handbook. Working through a certain date may qualify you for an annual bonus, extra vacation pay, full vesting on your retirement account or a bigger pension. If a stressful work situation or health issues make working difficult, you may be able to take a leave of absence or combine short-term medical benefits, vacation and sick time to reach the target.

Use health benefits. Use up medical, vision or dental benefits that will expire and any funds in a flexible spending account before the deadline. If you haven’t done so, determine what Medicare options best suit your needs.

Max out your tax-advantaged contributions. You can contribute to a 401(k) or solo 401(k) as long as you are working (regardless of age), and may be able to delay required minimum distributions if your plan allows it. If neither you nor your spouse has a 401(k), you can contribute to a traditional IRA (regardless of income) until you are 70½ if you are working. If you do have a 401(k) and your earned income doesn’t exceed the maximum allowed, you can contribute to a traditional IRA until you are 70½. As long as you have earned income, you can contribute to a Roth IRA (regardless of age) if your earned income falls below the maximum allowed.

Consider consolidating accounts. If your employer allows you to keep your 401(k) when you leave, compare its fees and range of investments to your IRA’s options. Consolidating can reduce paperwork and make it easier to balance investments, plan required minimum distributions and update beneficiary changes.

Do a dry run. Work with your advisor to create a distribution plan for your investments. After determining your monthly post-retirement income, try living on that amount for a few months. If it’s difficult, explore possible changes.

We want your retirement experience to be the one you’ve dreamed of. We can help you evaluate all the aspects related to your retirement years and create a personalized, comprehensive plan.

*The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Morgan Stanley Capital International Europe, Australia and Far East Index (MSCI EAFE Index) is a widely recognized benchmark of non-U.S. stock markets. It is an unmanaged index composed of a sample of companies representative of the market structure of 20 European and Pacific Basin countries and includes reinvestment of all dividends. Barclays Capital Aggregate Bond Index is an unmanaged index comprised of U.S. investment-grade, fixed-rate bond market securities, including government, government agency, corporate and mortgage-backed securities between one and 10 years. Written by Securities America, Copyright May 2017. All rights reserved. Securities offered through Securities America, Inc., Member FINRA/SIPC. SAI# 1802859.1

For the Week of May 8, 2017

The Markets

Solid corporate earnings, a stronger-than-expected April employment report and higher oil prices helped U.S. stocks rise Friday. The S&P 500 and the NASDAQ closed at record highs. For the week, the Dow rose 0.33 percent to close at 21,006.94. The S&P gained 0.66 percent to finish at 2,399.29, and the NASDAQ climbed 0.88 percent to end the week at 6,100.76.

Source: Morningstar.com. *Past performance is no guarantee of future results. Indexes are unmanaged and cannot be invested into directly. Three- and five-year returns are annualized. The Dow Jones Industrials, MSCI EAFE, Barclays US Agg Bond and S&P, excluding “1 Week” returns, are based on total return, which is a reflection of return to an investor by reinvesting dividends after the deduction of withholding tax. The NASDAQ is based on price return, which is the capital appreciation of the portfolio, excluding income generated by the assets in the portfolio in the form of interest and dividends. (TR) indicates total return. (PR) indicates price return. MSCI EAFE returns stated in U.S. dollars.

After Tax Reform — Following the Oct. 22, 1986, signing of the Tax Reform Act, the U.S. economy grew by an average of 3.8 percent per year for three subsequent years, i.e., 1987-89 (source: Department of Commerce, BTN Research).

Inflation Returns — Inflation using the Consumer Price Index has exceeded 2 percent year-over-year for four consecutive months through March, the first time inflation has had such a streak since April 2012. The Federal Reserve’s annual inflation target is 2 percent (source: Department of Labor, BTN Research).

Last Two Decades — The U.S. bond market, including treasury, municipal, corporate, mortgage and asset-backed debt, has increased 239 percent in size in the last 20 years to $39.4 trillion as of Dec. 31, 2016, equal to growth of 6.3 percent per year (source: Securities Industry and Financial Markets Association, BTN Research).

WEEKLY FOCUS – Thwart the Latest Scams

With criminals becoming more creative, honest citizens need to be more guarded to foil the latest scams. Here are a few examples to watch out for:

 Shared Google Docs. Last week, individuals received an email from someone they knew inviting them to view a Google Doc by clicking a link. When they did, they were asked for access permissions to their Gmail account, and their contacts were spammed. The phishing scheme raced around the internet before Google issued a statement saying the attack had been stopped. The latest in a series of Google Doc scams, this episode serves as a reminder to be on guard. If you’re not expecting a person to share a Google Doc, delete the email in question or contact them before clicking a link.

 Phone recordings. If a stranger calls and asks a question like, “Can you hear me?” or “Are you the homeowner?” avoid saying “yes.” If you do, your response is recorded, and they may claim you have agreed to an unwanted service or product. Even if they don’t, you have verified your number is active and you answer calls from unknown numbers, allowing the scammer to sell your number to other questionable solicitors. Instead, let calls with an unfamiliar number go to your answering machine, answer and hang up or respond with a question, such as “Can you hear me?” or “Who is calling?” If you suspect a call was from a scammer, note the number and report it to the BBB Scam Tracker to warn others. You can also report suspicious or unwanted calls to the FTC’s National Do Not Call Registry and register your home and mobile number to avoid, or at least reduce, unsolicited calls.

 Home improvement scams. Spring and summer months bring out home improvement con artists. Popular scams advertise a service at a low price and persuade the homeowner more expensive services are needed, ask for a large up-front payment and don’t deliver, or offer low prices because of poor services or “left-over” (actually substandard) product. When a major storm hits, storm chasers flood in who often install substandard roofs and are long gone when problems arise. The Better Business Bureau reminds homeowners to research companies thoroughly; check to see if they are licensed, bonded and insured; get a written contract; ask for references; and refuse to make large down payments or pay in cash.

Protecting your personal information and financial well-being is important to us. If you need assistance monitoring your accounts or believe you may have been a victim, please contact our office. We are here to assist you. For more information contact us at 973-771-5120 or via email to:   Info@Mywealthdiretion.com

* The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Morgan Stanley Capital International Europe, Australia and Far East Index (MSCI EAFE Index) is a widely recognized benchmark of non-U.S. stock markets. It is an unmanaged index composed of a sample of companies representative of the market structure of 20 European and Pacific Basin countries and includes reinvestment of all dividends. Barclays Capital Aggregate Bond Index is an unmanaged index comprised of U.S. investment-grade, fixed-rate bond market securities, including government, government agency, corporate and mortgage-backed securities between one and 10 years. Written by Securities America, Copyright May 2017. All rights reserved. Securities offered through Securities America, Inc., Member FINRA/SIPC. SAI# 1791307.1