According to a news survey by The Millionaire Corner, a Series 65 online resource about investing, this highly charged political environment regarding the future is about as stressful as swatting at mosquitoes during a Friday night barbeque.

The real issues, at least as far as affluent investors are concerned, are stock market conditions, the economic environment and their own retirement–in precisely that order. All of this partisan-related posturing conjures up about a 5 percent concern (2 percent for millionaires), and that may be just because they were asked how much it bothered them. After all, if someone asks you to list five foods in your order of preference, you wouldn’t leave the last one off entirely.

This is good news, because it signals that more people feel more in control of their future, and less reliant on Congress to figure it out for them. 

[CLICK HERE to read the article, "Affluent Investors Keeping Close Watch on Stock Market Conditions," at MillionaireCorner.com,  

[CLICK HERE to view graphics of "The recession and recovery in perspective," at The Federal Reserve Bank of Minneapolis, April 26, 2013.]

In an even more blasé survey by Franklin Templeton,¹ nearly a third of the surveyed respondents said they thought the stock market was flat or down last year, when in fact the S&P 500 was up 16 percent – and has performed admirably for the last four years. Because the majority of those surveyed also reported that they would be more conservative or make no changes to their investment portfolios, the study concluded that investors are still more concerned with avoiding loss rather than achieving higher returns.

[CLICK HERE to read the article, "What Ails the Economy? In a word: Washington," at Yahoo! Finance, April 26, 2013.]

[CLICK HERE to read the article, "Job Picture Looks Bleak for 2013 College Grads," at Yahoo! Finance, April 26, 2013.]

Despite people’s persistence in going to work every day, paying their bills, making plans for the future, and enjoying their families in this beautiful spring weather, headlines continue to warn us that our legislators are not doing their jobs and it’s causing great detriment to the economy.

The Commerce Department recently reported that the U.S. gross domestic product (GDP) grew by only 2.5 percent in the first quarter–substantially below expectations. It’s no wonder, however, since sequestration began in March. The new numbers reflect, at least partially, a 4.1 percent decrease in government spending, including the 11.5 percent reduction in defense spending.

The government cuts represent an interesting paradox as far as the economy is concerned, with one insider suggesting that, “Whatever your view is on government spending, it’s going to be a headwind for growth.”

[CLICK HERE to read the article, "First Quarter Growth, at 2.5%, Misses Expectations," at The Wall Street Journal, March 20, 2013.]

Americans, being what we are–resilient to terrorism, the housing bust and, yes, backyard mosquitoes–are taking in all of this economic and policy gloom and doom in stride. If you want to talk about your future, regardless of what goes on at Capitol Hill, please give us a call.

By contacting us you may be offered information on the sale of insurance products.  While we believe this information to be correct as of publication, we do not guarantee the accuracy of the information included.

The information and opinions contained herein are provided by third parties and have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by our firm. Content is provided for informational purposes only and is not a solicitation to buy or sell the products mentioned. The information is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet the particular needs of an individual’s situation.   

If you are unable to access any of the news articles and sources through the links provided in this text please contact us to request a copy of the desired reference.

If you could look into a crystal ball and predict which retirement income plan was more likely to be around in 20 years – would you choose Social Security or company pensions?

[CLICK HERE to read the article, "President Obama looks to reduce Social Security cost of living increases with 'chained CPI'," at marketplace.org, April 5, 2013.]

As much as the solvency of Social Security is constantly debated, it may well stay the course long term in some shape or form. Pensions, on the other hand, are rapidly heading towards extinction. The latest pension plans potentially facing cuts include Boeing and Major League Baseball (MLB).

Boeing recently announced its intention to stop offering pensions to new employees, joining the ranks of other large corporations that have adjusted pension offerings, including GE, Lockheed, Ford and General Motors.

[CLICK HERE to read the article, "Boeing's latest move confirms nationwide trend to end pensions," at KPLU.org, March 1, 2013.]

[CLICK HERE to read the article, "Ford's Leaky Pension Boat is a Multi-Billion Dollar Problem," at Forbes, March 31, 2013.]

It may be just as well, since pension plan funding has suffered significantly in recent years. In fact, Boeing has set aside only three-quarters of the $75 billion it owes for future pensions, a sum that represents more than the company’s current stock market value.

Boeing is not alone in its savings deficit. According to Olivia Mitchell, executive director of the Pension Research Council at Wharton Business School of the University of Pennsylvania, U.S. corporations currently boast the highest level of pension underfunding in history.

[CLICK HERE to read the article, "Are Pensions Dead?" at The Motley Fool, March 30, 2013.]

Even the MLB, despite climbing revenues of $8 billion a year, is considering cutbacks and/or alterations to pension plans offered by ball clubs. Similar moves by other organizations may not eliminate current pension plans, but they might stop contributing to them.

[CLICK HERE to read the article, "Personnel pensions on cutting block," at ESPN, March 20, 2013.]

The lesson here is that we may be on our own going forward. Within a couple of decades, the majority of our retirement income may result from our own planning, saving, investing and purchasing insurance policies to protect our income in retirement.

[CLICK HERE to read the article, "Lessons from the Financial Crisis," at Fidelity Viewpoints, April 2, 2013.]

If you’d like to discuss ways to generate and protect* retirement income in a world where individuals control their financial future, please give us a call.

By contacting us, you may be offered information regarding the purchase of insurance products. 

*Guarantees offered by annuities are subject to the financial strength and claims paying ability of the issuing insurance company.

The information and opinions in the linked articles are provided by third parties and have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed.  They are for informational purposes only and should are not intended to provide specific advice nor provide the basis for any purchasing decisions. 

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For all the criticism received prior to the New Year, both houses in Congress seem to be in full swing working on legislation on a wide range of issues, from budget control to gun control.

As for the budget, the huge divide doesn’t really appear to be getting any closer. With one phase of the sequester underway as of March 1, we now have another six-month “band-aid” instead of a long-term resolution.

As the budget challenge lingers, we also draw closer to another battle over increasing the debt limit, scheduled to bump into its ceiling later this summer. The financial analysts at Fidelity believe that fiscal debates will be ongoing until our debt situation stabilizes–calling this our “new normal.”

[CLICK HERE to read, "Congress avoids shutdown; bickers over 2014 budget," at CNN.com, March 22, 2013.]

[CLICK HERE to read the article, "What the budget battles mean for investors" at Fidelity, December 10, 2012.]

On the health care front, Paul Ryan and the GOP are still trying to overturn Obamacare. In addition to the wide-sweeping proposals to do away with much of the legislation, smaller bills are being introduced to chip away at some of the smaller issues the bill faces.

For example, the “Access to Independent Health Insurers Advisors Act” is designed to specifically exclude agent compensation from the Medical Loss Ratio (MLR) formula–primarily in the individual and small group markets. The Patient Protection and Affordability Act currently restricts health insurer profits by requiring that no more than 20 percent of an insurer’s expenses be attributed to non-medical costs. This includes health insurance broker commissions.

Expanded coverage requirements and the restricted medical loss ratio could result in profit losses for insurers. It is anticipated that they will reduce broker commissions to help shore up margins. This proposed legislation is designed to exclude broker commissions from the MLR so this field remains viable to help people navigate the complex health care market in the future.

[CLICK HERE to read the article, "Senate first at bat in 113^th with MLR bill introduction," at LifeHealthPro, March 22, 2013.]

[CLICK HERE to read the article, "Senate Dems vote to repeal part of health care law," at Benefitspro, March 22, 2013.]

Speaking of new legislation, to combat the threat of gun violence in South Dakota schools, the state has passed a law allowing school teachers to bring their own weapons to school. You can read more about this and the history of gun legislation in this country, below.

[CLICK HERE to read the article, "A State Backs Guns in Class for Teachers" at The New York Times, March 8, 2013.]

[CLICK HERE to read the special report, "Guns in America," at The Washington Post, March 13, 2013.]

Remember that whenever new legislation gets passed, it’s important to understand how changes can impact your financial situation. If you would like a personal review and consultation, please give us a call.

Your financial professional is not permitted to offer, and no statement contained herein shall constitute tax, legal or accounting advice. Individuals should consult with a qualified professional regarding the applicability of this information to your situation. By contacting us you may be provided with information regarding the purchase of insurance products.

By contacting us you may be provided with information regarding the purchase of insurance.

The information and opinions contained herein are provided by third parties and have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by our firm. Content is provided for informational purposes only and is not a solicitation to buy or sell the products mentioned. The information is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet the particular needs of an individual’s situation.   

If you are unable to access any of the news articles and sources through the links provided in this text please contact us to request a copy of the desired reference.

According to a new study by Prudential Financial, the majority of women today are financially responsible for providing their own and their families’ income. Among the 1,400 women surveyed, 53 percent are primary breadwinners, and 22 percent of women who are married or living with a partner report being the one who makes the most money. The research concludes that these recent findings are largely due to the impact of the Great Recession.

[CLICK HERE to read the  news release, "Women are primary breadwinners, whether they like it or not," July 11, 2012.]

[CLICK HERE to read the report, "Financial Experience & Behaviors Among Women," from Prudential Financial, July, 2012.]

Economic Partnership
The 2009 National Marriage Project report, “The State of Our Unions,“ found that women offer more risk-management capabilities when it comes to managing the household investment portfolio. The study revealed that while husbands are more focused on performance, women view investments as a way to help secure their family’s financial future.

The study also concluded that since the beginning of the nation’s economic downturn, millions of Americans have relied on their own marriages and families to weather this economic storm. “The recession reminds us that marriage is more than an emotional relationship; marriage is also an economic partnership and social safety net. There is nothing like the loss of a job, an imminent foreclosure, or a shrinking 401(k) to gain new appreciation for a wife’s job, a husband’s commitment to pay down debt, or the in-laws’ willingness to help out with childcare or a rent-free place to live,” according to one of the report’s authors.

[CLICK HERE to read the "The State of Our Unions: Marriage in America 2009," at The National Marriage Project, December 2009.]

[CLICK HERE to read the article, "The Great Recession's Silver Lining?" at thestateofourunions.org, December 2009.]

[CLICK HERE to read the article, "The Smart Money: She Saves, He Spends," at thestateofourunions.org,  December 2009.]

Job Front
According to the Institute for Women’s Policy Research, in the last three years of the recovery, men have recaptured 46.2 percent of all the jobs they lost since the beginning of the recession. Women are about 10 percent behind, having gained back 38.7 percent of jobs lost. Many of the job losses for women came from the public sector, as they are more concentrated in Government than men. However, growth in non-government jobs in the health and education sectors–the largest industries for women’s employment–have helped their recovery numbers.

[CLICK HERE to read the article, "Women Pick Up The Pace On Jobs Gains," at The Wall Street Journal, August 13, 2012.]

One of the key lessons we’ve learned throughout these recessionary times is how to buckle the belt when there is no other option. If your household has acquired a new income source in light of economic growth and recovery, consider maintaining those spending controls and assigning the new income stream to a disciplined investment or savings strategy. After all, the lessons we learn today can go a long way to securing our future tomorrow. Please contact us to discuss this learning opportunity further.

The information and opinions contained herein are provided by third parties and have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by our firm. Content is provided for informational purposes only and is not a solicitation to buy or sell the products mentioned. The information is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet the particular needs of an individual’s situation.

If you are unable to access any of the news articles and sources through the links provided in this text please contact us to request a copy of the desired reference.

What “Recovery” Feels Like

Today’s headlines are dominated by the claims, promises, accusations and trash talk of our noble presidential candidates. Each says they’re fighting for the future of middle-class Americans, a category of citizens for whom neither can admit to being a card-carrying member.

But who is the middle class, anyway? Recent research and survey trends have unleashed some interesting findings. For example, since 2000 the middle class has shrunk in size, from 61% of the adult population in 1971 to 51% in 2011. Not surprisingly, there were increases in the upper economic tier (from 14% to 20%) and lower tier (from 25% to 29%) during the same time frame.¹

¹[CLICK HERE to read the news release, "The Lost Decade of the Middle Class," at Pew Research Center, August 22, 2012.]

[CLICK HERE to read the article, "Middle Class Exit 'Lost Decade' With Little Hope: Pew Report," at The Huffington Post, August 22, 2012.]

Even though the Great Recession officially ended three years ago, the middle class isn’t really feeling much recovery in terms of its income – or home equity for that matter. Sixty-two percent say they had to reduce household spending in the past year due to money issues, whereas at the height of the recession in 2008, only 53% reported cutting back.¹

According to data from the Federal Reserve’s Survey of Consumer Finances, American’s median net worth fell 28% from 2001 to 2010, erasing two decades of gains. From 2007 to 2010 alone, the value of middle income family assets fell by 19%.¹

Mature Middle Class

From 2001 to 2011, adults ages 65 and older fared best, or so it would seem. Their incomes are higher now than in 2001, but you could also attribute this to the fact that many 65+ folks are continuing to work, whereas before they could retire. 

And speaking of earning income, mature workers do not appear to be enjoying the increases their younger peers are getting. According to a new report from Sentier Research, the typical household income for people age 55 to 64 years old is almost 10% less in today’s dollars than it was three years ago – when the recovery officially began. Actually, in almost every demographic group nationwide, Americans are earning less today on average than they did in June 2009, despite our third year in recovery.

Perhaps we should reconsider what “recovery” really means.

[CLICK HERE to read the article, "Big Income Losses for Those Near Retirement," at The New York Times, August 23, 2012.]
 

Who’s Getting Paid More?

A recent AOH Hewitt survey found that companies are spending less on base pay increases for all workers, opting instead to reward high-performing workers with larger bonuses. According to an AON Hewitt spokesperson, “It is unlikely that salary increases will reach pre-recession levels of 4% or higher any time soon.” Aon Hewitt projects base pay increases of 3% in 2013 for executives, salaried exempt and nonexempt workers.

However, some areas of the country are more likely to pay higher increases than the national average, including Denver, Austin, Dallas/Fort Worth, Detroit, San Diego, Houston and Kansas City. Cities expected to pay lower-than-average increases in 2013 include San Francisco, Chicago and Minneapolis/St. Paul.

[CLICK HERE to read the news release, "Aon Hewitt Survey Shows Marginal Rise in Salary Increases in 2012; Spending on Performance-Based Awards Remains Strong," at Aon Hewitt, August 13, 2012.]

[CLICK HERE to read the Employment Cost Index news release for June; U.S. Bureau of Labor Statistics, July 31, 2012.]

As our “recovery” continues to amble along, you may feel more confident about the future by putting your savings on track for risk-managed growth opportunity – coupled with retirement income security – for the future. We’ve got strategies that can help you do that. Please give us a call.