Folks,

On 12/4/20 the U.S. Secretary of Education Betsy DeVos announced an extension on the federal student loan forbearance period. Federal student loan borrowers will not be expected to make payments through January of next year, 2021. Non-payments will continue to count toward the number of payments required under an income-driven repayment plan, a loan rehabilitation agreement, or the Public Service Loan Forgiveness program.

During this forbearance period any payments will go directly to the loan principal which will lower your interest payment in the future. We urge our clients to take advantage, if financially feasible, of this opportunity and pay down the principle on your loans.

This article was posted by the U.S. Department of Education:

https://www.ed.gov/news/press-releases/secretary-devos-extends-student-loan-forbearance-period-through-january-31-2021-response-covid-19-national-emergency

If you or anyone know anyone you know needs help understanding their student loan status please feel free to contact us.

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.

Changes to Federal Tax Forms From 2017 Tax Changes Impacts Preparation of Free Application for Federal Student Aid (FAFSA)

Beginning October 1, 2019, applicants will be able to file for the 2020-2021 FAFSA using information from your 2018 tax return. In previous years the IRS Data Retrieval Tool would be able to import data from the parent & student Federal Income tax return. The new 1040 form eliminated the existing IRS forms 1040A and 1040EZ and added a set of schedules, for those tax returns requiring more information. As usual, the left hand doesn’t talk to the right hand. So, the changes to the tax forms have not been incorporated into the FAFSA application and Data Retrieval Tool. This creates confusion and new questions on the 2020-2021 FAFSA process, that if answered incorrectly may affect the Expected Family Contribution (EFC) and therefore the amount of aid the family may receive.

If you would like more information on this issue or help in preparing your FAFSA for next year give us a call at 973-771-5120

Jim was recently featured in Retirement Daily’s Ask Bob column! Click to get his input on spousal benefits for social security.

For the Week of April 29, 2019

The Markets

Better-than-expected economic data helped stocks close higher Friday. The U.S. gross domestic product grew at 3.2 percent in the first quarter. Amid this positive news, the S&P 500 and the NASDAQ closed at record highs. For the week, the Dow fell 0.06 percent to close at 26,543.33. The S&P gained 1.21 percent to finish at 2,939.88, and the NASDAQ climbed 1.85 percent to end the week at 8,146.40.

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.

Nothing?! — Forty-five percent of the 76 million baby boomers in the U.S. have no retirement savings. The oldest boomers turned 65 years old in 2011. This year is the ninth of 19 years of baby boomers turning 65 (source: Insured Retirement Institute, BTN Research).

In Less Than a Generation — The average cost of one year of college at an average four-year public institution (including tuition, fees, room and board) has tripled over the last 22 years, rising from $7,142 for academic year 1996-97 to $21,370 during academic year 2018-19 (source: College Board, BTN Research).

10-Year Paper — The yield on the 10-year Treasury note closed at 2.56 percent on Thursday, April 18. The 10-year note yield closed at 2.98 percent on April 18, 2009. The 10-year note yield closed at 5.23 percent on April 18, 1999. The 10-year note yield closed at 9.06 percent on April 18, 1989 (source: Treasury Department, BTN Research).

WEEKLY FOCUS – 3 Ways to Make Money With Your Talents and Skills

Want to make a little extra cash? Retired and just a tad bit bored? Looking to expedite paying off student loans or saving for a dream vacation? Whatever the reason, maybe you’re thinking about a part-time job but already work full time, or don’t want to embark on a new career or retool your education. Why not cash in on existing skills or talent?

Here are a few ways to pick up a little extra money, online and off:

Teach: You’ve honed your skills over your career. Why not pass them on? Next gen professionals would benefit from your experience. And you’d have the satisfaction of knowing those lessons wouldn’t be forgotten. And don’t overlook your hobbies or general life experiences. Community colleges have entire sections devoted to ongoing education and life experiences, including travel outings, home and garden projects and specific hobbies. You could also develop online courses on your own if you’re willing to market yourself.

Consult: Companies often outsource certain tasks to experienced consultants. This type of independent work can be very appealing. And don’t forget to think outside the box. If you have great organizational skills, you could even offer your services as a personal home organizer.

Create: Your degree was in business, but you really wanted to become an artist (or photographer or writer, etc.). Over the years, you’ve created on the side, just for pleasure. Why not share your talent? There are websites that buy photos for image databases. Or, you could find local retailers to exhibit your for-sale art. The retailer gets original works to grace their store, and you have a venue with guaranteed traffic. You can also sell online. Several virtual storefronts cater to artists, crafters and those offering specialized services.

Opportunities to make extra money are constantly expanding. Why not capitalize on your given (and hidden) strengths, talents and skills?

If you need to reassess your future finances or major income streams, call our office. We can help ensure your financial plans are on track to meet your longevity goals.

* 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 April 2019. All rights reserved. Securities offered through Securities America, Inc., Member FINRA/SIPC. SAI#2520512.1

The first quarter of 2019 is in the books and fortunately for investors, a return to “normalcy” has occurred. Now “normalcy”, as used here, refers to the penchant for stocks to march deliberately higher and bond yields to stay stubbornly low. Last quarters brutal sell-off in equities is but a distant memory and Pollyanna has returned.

While I’m thrilled with the rebound in asset prices I’m not sure the markets aren’t wishing upon a star at this stage in the economic cycle.

On March 28, 2019 the final reading for 4^th quarter 2018 US Gross Domestic Product was up 2.2%, with the growth for all of 2018 at 2.9%. Consumer and government spending were revised down in the report.  On March 26^th, the Consumer Confidence Index declined from 131.4 in February to 124.1 in March.  The Expectations Index – based on consumers’ short-term outlook for income, business and labor market conditions – decreased from 103.8 in February to 99.8 in March. Just today, the Institute for Supply Management non-manufacturing index declined in March, to the lowest level since August 2017.  Clearly, the US economy is slowing. However, I believe we maintain growth at roughly 2% per year.

The global economy is also showing signs of slowing.  Much of this is, I believe, attributable to 2 big geo-political unknowns – the US/China trade negotiations and the United Kingdom leaving (or not) the European Union. These types of unknowns bring business investment in hiring, new equipment, and new product development to a halt. Getting these two issues resolved, hopefully in a positive fashion, will provide a boost to global growth. Alternatively, a breakdown in the US/China trade deal and/or a negative outcome in the UK would likely increase the odds of a global economic slowdown.

On the investment front,  I am most concerned about corporate earnings, which start reporting on April 14^th.  Corporate earnings growth slowed dramatically in the 4^th quarter of 2018, and could even turn negative for the 1^st quarter of 2019.  While the stock market is aware of this, I’m not sure it has priced it correctly.  If 1^st quarter earnings are better than expected then the market probably continues its upward bias.  If earnings are worse, then I expect the market to experience a selloff, albeit not as dramatic as what we saw at the end of last year.

Overall, I remain optimistic but cautious.  We have some tailwinds – low interest rates and inflation, a steady job market and slowly rising wages, but there are risks that are hard to quantify – political uncertainty and trade tensions.  We will continue to monitor the situation and adjust accordingly.

I hope you find this report helpful. Please feel free to share it.

We have added a new tool to help those nearing or just beginning retirement to explore their readiness for retirement.  It’s an easy interactive tool.  Please share it with family, friends and colleagues.

https://www.ready-2-retire.me/JimMcCarthy

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

• April  is National Autism Awareness month.  Let’s all get educated on this issue and works towards acceptance and inclusion of people dealing with autism.
• April is also National Financial Capability month.  We at Directional Wealth Management commit to equipping individuals to lead better financial lives through an integrated framework of educational resources, collaborative tools,  and personal one-to-one advice.

April 10^th                     Christian’s wife Maecy birthday

April 12 & 13^th            We adopted our 4 legged children Coco (2010) and Buddy (2013)

April 15^th                     Tax Day.  Remember to make those IRA or Roth contributions.

April 20^th                     Passover begins – Chag Pesach Sameach

April 21^st                     Easter Sunday – Have a blessed and Holy Easter

April 22^nd                     Earth Day – let’s all recycle, turn out lights when we leave rooms, and do all we can for our environment

April 24^th                     Administrative Professionals day – remember your staff

April 25^th                     My daughter Satya’s birthday – wow she is turning 35!  I must be getting old 😊

Sources:  JPMorgan, Nottingham Advisors

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.

For the Week of December 3, 2018

The Markets

Stocks were up Friday, reflecting optimism about a potential trade deal with China. The S&P Index and the NASDAQ achieved their best week in nearly seven years, and the three major indexes were positive for the month. For the week, the Dow rose 5.32 percent to close at 25,538.46. The S&P gained 4.91 percent to finish at 2,760.17, and the NASDAQ climbed 5.64 percent to end the week at 7,330.54.

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.

Use Time to Your Advantage — $522 invested at the beginning of every month for 40 years, earning 6 percent per year, will accumulate to $1 million. $1,021 invested at the beginning of every month for 30 years, earning 6 percent per year, will accumulate to $1 million. The calculations ignore the impact of taxes and are for illustrative purposes only. They are not intended to reflect any specific investment alternative (source: BTN Research).

Bonds Are Down Too — The YTD total return through Friday, Nov. 23, of 10-year Treasury notes was a loss of 3.1 percent (source: Ryan Indexes, BTN Research).

What They Pay — The average tax rate (including federal income taxes, payroll taxes and excise taxes paid as a percentage of income) for the bottom 20 percent of U.S. taxpayers has fallen from 7.5 percent of before-tax income in 1979 to 1.5 percent of before-tax income in 2015. The average tax rate for the top 1 percent of U.S. taxpayers has fallen from 38.5 percent of before-tax income in 1979 to 33.3 percent of before-tax income in 2015 (source: Congressional Budget Office, BTN Research).

WEEKLY FOCUS – Plan for Three Stages of Retirement

To prepare for retirement, it’s important to have a solid financial plan in place before you leave the workforce. No matter what your age, starting on your plan today will give you more flexibility later in life.

Retirement is typically viewed as a single phase of life. But it is more accurately divided into three stages, each with unique financial needs. Early retirement, sometimes called the “go-go” years, is a time of increased activity. During middle retirement, or the “slow-go” years, activity levels decline. And in late retirement, or the “no-go” years, extra activities stop.

Early Retirement: These are the years you’ve dreamed of. You still have your health, and you have the time to travel and indulge in hobbies. But all this activity means you may spend more than when you were working. If you’ve planned for retirement and aren’t counting on Social Security, filing early for benefits could help pay for leisure activities. But claiming Social Security before full retirement age will lock you into a reduced monthly benefit. Claiming benefits at age 62 could lead to a 30 percent cut in what you would have received if you had waited until full retirement age.

Middle Retirement: In this period, personal spending declines, but health care costs often increase. A recent report revealed people incur an average of $122,000 in out-of-pocket medical costs from their 70^th birthday until death.¹ This is the time when you can reap the rewards of waiting until full retirement age to claim Social Security benefits. Remember, for each year you wait until you turn 70, you’ll receive an 8 percent boost. That extra cash could help with medical expenses.

Late Retirement: By late retirement, expenses related to travel and big-ticket purchases are typically no longer a concern. In this stage, you’ll need adequate funds to keep you comfortable and possibly pass on a legacy. According to the Social Security Administration, a 65-year-old man today can expect to live to 84.3, while a 65-year-old woman can expect to live to 86.7.² With life expectancy projected to increase, it’s important to have a financial plan that will take you comfortably into your 80s, 90s or even to 100.

To get started building a financial plan or to revisit your existing plan to ensure it will take you through each stage of retirement, give us a call today.

¹http://www.nber.org/papers/w24599.pdf          ²http://www.ssa.gov/planners/lifeexpectancy.html

* 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 December 2018. All rights reserved. Securities offered through Securities America, Inc., Member FINRA/SIPC. SAI#2335657.1

Financial Market Overview

October has a bad reputation for monumental crashes such as those in 1928, 1987 and 2008, but historical data indicate a push to new highs through the end of the year is likely.  October for the S&P 500, for the last 20 years, is actually the strongest month of the year. The S&P 500 has risen by an average 2.1% in October over the past 20 years. (source: LPL Financial)  Additionally,  going back to 1950, October is the strongest month during midterm election years. Since 1982, October in midterm years has only been down once.

source: CNBC.com

US equities continue to outperform International and likely will continue to do so.  In fixed income, interest rates rose across all time frames (short, medium and long) due to the Federal Reserve continuing to increase short-term rates and the strength of the US economy.  This has put downward pressure on fixed income security values.  We continue to favor equities over fixed income.

Economic Overview

The third reading for second quarter GDP growth reaffirmed what I have been saying – the US economy is growing solidly. Growth in the second quarter was 4.2%, up from 2.2% in Q1, and estimates are for it to remain north of 4% going into Q4. Unemployment remains historically low, inflation is tame, the housing market remains robust and the fiscal stimulus released by the tax reform act in 2017 is still feeding its way into the economy.

While the US economy is quite strong right now, I am anticipating a slow-down in growth (not a recession) in mid-to-late 2019, as the combined effects of the fiscal stimulus wearing off while the Federal Reserve is raising interest rates to act as brakes.

Overall, we have a positive outlook for the economy and financial market for the balance of 2018 and well into 2019.  We continue to invest accordingly while monitoring for any change to our outlook.

We hope you find this report informative.  Please share it with anyone who you feel would benefit from the information.

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

• October is Breast Cancer Awareness and Domestic Violence Awareness month.

October 7^th        2^nd anniversary of purchasing our office building – we’d love to have you come for a visit   – 141 W Main Street Rockaway

October 8^th        Columbus Day

October 15^th  Medicare open enrollment    thru 12/7/18 – you can switch from original Medicare to Medicare Advantage, or vice versa. You can also switch from one Medicare Advantage plan to another, or from one Medicare Part D (prescription drug) plan to another, or drop your Medicare Part D coverage altogether. Please call us if you have any questions about your options.

October 22^nd   National Nut Day – only in America can you have a day to celebrate nuts.  Ps: peanuts are legumes, not nuts!

October 31^st    Halloween

Sources:  CNBC.com, LPL Financial, Nottingham Advisors

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.

Applications for the NJ Senior Property Tax Freeze must be filed by October 31, 2018

There are several eligibility criteria:

• You were age 65 or older as of 12/31/2016
• You have lived in New Jersey, as a homeowner or renter, since 12/31/2006
• You have owned and lived in the same home since 12/31/2016
• You must have paid the full amount of the Property Taxes due on your home:
  • For 2016: By June 1, 2017, and For 2017: By June 1, 2018; and

• Your total annual income must have been:
  • For 2016: $87,007 or less, and For 2017: $87,268 or less.  (NOTE: Income for this purpose is “all” income received, including Social Security, Pensions, IRA distributions, etc.)

If you meet all the above criteria you should file the application.  You can find the forms and instructions here:  https://www.state.nj.us/treasury/taxation/ptr/printform.shtml

If you do not meet all of the above criteria then there is no need to file.

Please feel free to contact us if you have any questions or reach out to your income tax preparer.

Source: https://www.state.nj.us/treasury/taxation