Annual Credit Report Reminder

Summer is just around the corner, and with the barbecues and cicadas comes another reminder from us that you should check your credit report.

The Fair Credit Reporting Act (FCRA) requires each of the nationwide credit reporting companies — Equifax, Experian, and TransUnion — to provide you with a free copy of your credit report, at your request, once every 12 months. Here is a link to the Federal Trade Commission website

To get your credit report online visit this site:  Click on request your free credit report.

Since you get 1 report each year from each reporting company my suggestion is to spread them out during the year.  For example, request Equifax in January, Experian in May, and TransUnion in September.  That way you can see any changes made throughout the year.

If you would rather make the request by mail , print and complete the attached Annual Credit Report Request Form and mail it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.  Again, I would print 3 copies and make separate requests throughout the year.

Review each report for inaccuracies or incomplete information and follow the supplied instructions on how to get these corrected.

Please call me if you have any questions on this information. annual-report-request-form

Weekly Market Notes – May 10, 2021

For the Week of May 10, 2021

The Markets

Stocks rose to record levels Friday despite negative economic news. The Labor Department reported just 266,000 non-farm jobs were added last month, far from the 1 million forecasters expected, and the unemployment rate rose 6 percent. Bad news seemed to be good news to investors expecting the Fed to keep interest rates low. For the week, the Dow rose 2.72 percent to close at 34,777.76. The S&P gained 1.26 percent to finish at 4,232.60, and the NASDAQ dropped 1.48 percent to end at 13,752.24.

Returns Through 5/7/20211 WeekYTD1 Year3 Year5 Year
Dow Jones Industrials (TR)2.7214.3348.7315.2417.13
NASDAQ Composite (TR)-1.486.9454.3624.9225.05
S&P 500 (TR)1.2613.2549.3518.7917.79
Barclays US Agg Bond (TR)0.28-2.340.175.313.21
MSCI EAFE (TR)2.599.3646.887.2510.11

Source: *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, NASDAQ 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. (TR) indicates total return. MSCI EAFE returns stated in U.S. dollars.

Tax Cheaters — In September 2019, the government projected our nation’s tax gap, i.e., the difference between what all taxpayers should have paid compared to what they actually paid, was $441 billion per year. On April 13, IRS Commissioner Charles Rettig testified before the Senate Finance Committee the tax gap could be as high as $1 trillion annually, or more than double the previous estimate (source: IRS, BTN Research).

Wood — The average cost of building a new single-family home in the U.S. has increased by 8 percent in the last year ($24,000) solely because of the rising cost of lumber. Lumber mills shut down nationwide in 2020 for as long as four months, leading to a lumber shortage as homebuilding demand accelerated. Lumber imports into the U.S. have been impacted by a beetle plague ravaging Canadian forests (source: National Association of Homebuilders, BTN Research).

Half — 49 percent of the United States’ 330 million population maintain their health insurance through an employer’s health insurance plan either as an employee or a dependent of an employee (source: Kaiser Family Foundation, BTN Research).

WEEKLY FOCUS – Make Your Tax Refund Work for You

If you’re one of the millions of Americans receiving a tax refund this year, why not use that money to reap long-term benefits? The following seven options could make a lasting impact on your financial well-being:

  1. Having an emergency fund to cover basic living expenses is an important step to achieving your financial plans and keeping your retirement funds secure. If you don’t have six months of living expenses set aside in a high-interest savings account, use your tax refund to get closer to that goal.
  • If you have credit card debt, pay down your balance to get out of debt quicker. Then invest the money you save each month.
  • If your emergency fund is set and you don’t have high-interest debt, invest your tax refund in your retirement plan. If you want to reap the full benefits of compound interest, the sooner the better.
  • If there’s a course you’ve been wanting to take to boost your career, use your refund for tuition. Or, perhaps you have a hobby you’ve always wanted to turn into a side business. Why not use the money to create a website or build the inventory you need to get started?
  • Increase your home’s efficiency with new windows or appliances. You’ll save money on utility bills now and make your home more valuable when it’s time to sell.
  • Purchase a term life insurance policy to guarantee your loved ones an equal standard of living should tragedy strike.
  • Donate part or all of your tax refund to a charity and lower your taxable income in the process.

How you spend your money will ultimately depend upon your goals and individual financial situation. If you need help deciding your best route, call our office.

* 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. SAI#1581151.1 

May 2021 Monthly Outlook – Managing Risk – Dangerous Leap

“Risk is good. Not properly managing your risk is a dangerous leap.”  – Evel Knievel

We believe the strategic case for risk assets remains favorable, with ongoing support from: 1) economic reopening and normalization, 2) fiscal support, 3) pent-up savings, and 4) historically easy financial conditions. As we move into the post-COVID-19 world, we believe the recovery will be non-linear and the opportunity set highly dynamic.  We expect the economy to show superior growth for the balance of 2021, while the financial markets have already priced in a good deal of this growth.  The financial markets will need to contend with the potential for rising inflation driven by the economic growth and the potential for the FED to reduce monetary accommodation to fight inflation.   Come 2022, we expect economic activity to fall back into a normal range of 2%-3% per year. 

Chart of the week
Source: Goldman Sachs Global Investment Research and GSAM SAS Market Strategy

On the investing front, we are on alert as despite a barrage of positive economic data recently and amazingly positive corporate earnings reports, there has been a  pattern of sell-the-news profit taking in the past two weeks of April. It also comes at a time when defensive assets are showing relative strength compared to growth assets. The move isn’t large enough to break through recent support, but it was significant enough to establish a divergence between the movement of major market benchmarks and their volatility measures. This kind of price movement is typical when markets are faltering near highs. It implies that institutional investors often want to quietly slip out of their positions before the demand for stocks becomes too weak and creates a rush of sellers.  

The chart below shows that the S&P 500 Index and the Nasdaq 100 Index, have both showed a subtle pattern of higher highs over the past two weeks. Meanwhile, the Cboe Volatility Index (VIX), and the Cboe Nasdaq Volatility Index(VXN) are showing a pattern of higher lows (they should be showing a pattern of lower lows). This makes a subtle implication that market makers are a bit worried about the potential for falling prices.

That seems incongruous given the excessively positive data from both the private and the public sector that the economic recovery is progressing rapidly. But this is the kind of clue that experienced investors look for. When price action doesn’t follow what seems to be obvious for a given narrative, then we start to wonder if a larger, less obvious dynamic is building. It may not materialize into a full blown change of trend, but if it does do so, this is the kind of subtle warning the market might give.

Source: Investopedia

Therefore we have tightened our risk management thresholds while simultaneously shifting our portfolio allocations into areas that continue to show strength.

We hope you find this report informative.  Feel free to call us with any questions or concerns.  Please share this report with anyone you feel will benefit from it.

May Calendar of Events   (comments and additions for future months are always welcome)

·      May is National Mental Health awareness month.  Nearly 44 million American adults, and millions of children, experience mental health conditions each year. Let’s all get educated on this issue and work towards acceptance and inclusion of people dealing with mental health issues.

May 5th                      Cinco De Mayo – stay thirsty my friends                 

May 9th                     Mother’s Day – wishing all mom’s, grandmothers, and great grandmothers a wonderful day. Hopefully soon we can get together to celebrate.

May 15th                   Armed Forces Day.  Dedicated to recognizing those presently serving in our armed forces

May 23rd                    My daughter Caryn’s birthday  

May 31st                   Memorial Day – let’s remember and give thanks to all who served our country


Sources: Investopedia, Bespoke Investment Group, Goldman Sachs

Although information herein has been obtained from sources deemed reliable, its accuracy and completeness are not asserted. All opinions and estimates included in this report constitute the judgment of the financial advisor as of the dates indicated and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security.

Investing involves risk and you may incur a profit or a loss. Diversification does not ensure a profit or ensure against a loss. There is no assurance that any investment strategy will be successful.  Past performance is no assurance of future results.

Please consider the charges, risks, expenses and investment objectives carefully before investing. Please see a prospectus containing this and other information. Read it carefully before you invest or send money.

Information provided should not be construed as legal or tax advice.  You should discuss any tax or legal matter with the appropriate professional.