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Crunch Time Tips for Tax Time

Posted by on Mar 25, 2019 in blog | Comments Off on Crunch Time Tips for Tax Time

Crunch Time Tips for Tax Time

Each year HFS strives to educate our team and our clients on helpful tips for tax time. Click here, New Year, New Tax Changes, for a review of the Tax Cuts and Jobs Act changes. You, your CPA, and your Financial Planner can work together to plan so you have no surprises near year end. You put your trust in the team around you to be on top of the latest information and adjust plans as necessary to stay on course.

Due to the changes in tax law, the amount of people who itemize their tax returns will fall from 46 million to 16 million in the US according to The Financial Planning Association guide Money: Tax Guide 2019. This is largely due to the following changes: (more…)

Is Financial Stress Eating Up Your Profits?

Posted by on Feb 14, 2019 in blog | Comments Off on Is Financial Stress Eating Up Your Profits?

Is Financial Stress Eating Up Your Profits?

Financial stress is a silent killer that may be robbing your business of thousands or even millions of dollars of profit annually.  Mercer estimated that employers lost approximately 250 billion in wages in 2017 because of financial stress1.  The survey which was based on 3,000 workers found that employees are spending approximately 150 hours annually during work time on financial issues1.  Seventy percent of HR professionals say financial stress is impacting their workforce.  In addition, financial stress can also lead to increased absenteeism, lower productivity, and higher healthcare costs.  Many Americans are anxious about their retirement security and for good reason, companies have abandon the Defined Benefit pension plan, for the Defined Contribution or 401(k) plan.  Two thirds of employees age 55-64 don’t have enough in retirement savings to cover one year of income.  Sixty three percent of our workforce doesn’t have enough in a rainy day fund to cover a $500 emergency2(more…)

Global Asset Allocation Views – Q1 2019

Posted by on Jan 29, 2019 in blog | Comments Off on Global Asset Allocation Views – Q1 2019

Global Asset Allocation Views – Q1 2019

Global Asset Allocation Views – Q1 2019

Quarter in Review

            The 4th quarter of 2018 did not go as planned, though in reality nothing about investing truly ever goes to plan.  The S&P 500 had just hit an all-time high and we were heading into historically what has been the strongest part of the calendar.  Then Fed Chairman Jerome Powell spoke.  An unscripted comment about how we are ‘a long way’ from neutral on interest rates and the rest is history.  Many people still remember 2007 and how the Fed overzealously tightened.  As the floodgates opened, under the radar events began to occur: 1) sentiment began to dampen as economic data came in lower than expected, 2) investors were busy harvesting losses and more eager to sell than to buy, and finally 3) institutional investors went missing as a large number of hedge funds closed up shop and algorithmic trading computers were having their support levels broken leading to forced selling.  A selling stampede occurred and there was no liquidity to prop up the market.

The S&P 500, on a total return basis, finished the year in the red for the first time since 2008.  The US Aggregate bond index closed flat for the year, while international markets fell even harder than domestic stocks as trade concerns, US Fed tightening, and a firm dollar all were significant headwinds for international companies.  It is prudent to never overreact to short-term bouts of volatility. (more…)

Do You Know the Real Rate of Return On Your Investments?

Posted by on Jan 29, 2019 in blog | Comments Off on Do You Know the Real Rate of Return On Your Investments?

Do You Know the Real Rate of Return On Your Investments?

Many investors look at their monthly statements or review their account online and look at a couple of numbers to determine how their investments are doing. The first number is usually the balance in your account. If it is more than it was the last time you looked at it then you feel good. Next they look at the percentage return on their portfolio to see if it is a number they can feel good about. Obviously, the higher the number the better. However, before you put your statement away it is important for you to understand what your rate of return is really telling you.

In August 2014 Thornburg Investment Management authored a study on investment returns and what the real rate of return is on a portfolio. You can review the study by clicking here. Thornburg notes that nominal returns are a misleading indicator of what the returns on your portfolio actually mean in terms of the buying power of your money. Different investment vehicles offer different potential for real rates of return. The big question is; how should you invest your hard earned dollars to give you the best buying power when you need the money?

In order to determine the Real Real Rate of Return you need to consider not only the interest rate or market growth of your invested dollars but also the erosion of the nominal return from taxes, expenses and inflation. (more…)

Out with the old and in with the new…year?

Posted by on Dec 18, 2018 in blog | Comments Off on Out with the old and in with the new…year?

Out with the old and in with the new…year?

The year of 2018 is sprinting to the finish line. The snow is starting to fall and the fireplace is crackling as we hustle through December. Days like today are the best time to reflect on the year in review. Your reflection can help you establish your “why.” Why do you get out of bed in the morning? Why do you go to work each day? Why do you choose to raise children? Your why is your purpose. To review the year passed is to review your purpose:

-Who are you most grateful for?

-What are you most grateful for?

-Did you make a meaningful impact in the life of someone else? (more…)

The ABCs of ESG

Posted by on Dec 12, 2018 in blog | Comments Off on The ABCs of ESG

The ABCs of ESG

What is ESG?

ESG (Environmental, Social, and Governance) is an investment discipline focused on non-financial factors that investors have determined as being critical for a firm’s long-term performance.  These factors focus on a variety of issues ranging from climate change, gender equality in the workplace, and board independence.  Companies have begun to voluntarily report on their ESG issues with many investment institutions urging the SEC to make it mandatory.

(more…)

Global Asset Allocation Views – Q4 2018

Posted by on Oct 17, 2018 in blog | Comments Off on Global Asset Allocation Views – Q4 2018

Global Asset Allocation Views – Q4 2018

Bulls and bears can both point to different sets of data to make their case on the markets.  Bulls can point to continued strength in the Leading-Coincident Indicator which shows no sign of a recession and a flattening, but not yet inverted, yield curve which has historically been the best time to be invested.  We also just had the strongest GDP number (4.2%) since Q3 2014!  Bears can look at high debt levels continuing to pile up in our Federal government as well as in corporate debt, where the next potential bubble may be hiding.  The good news on the debt level is that households, the financial sector, and state/local governments continue to show low and falling debt levels.  More bad news comes from overseas where trade tensions, hawkish US monetary rhetoric, and strong oil prices have put real pressure on Emerging Markets.

The S&P posted its best quarter since 2013 with a 7.2% gain amid low volatility and countering what has historically been a tough part of the calendar.  The U.S., Canada, and Mexico finally agreed on terms for a revamp of NAFTA that has helped alleviate trade concerns with our closest trade partners.  Unfortunately, the U.S. and China are further from a deal with the US potentially slapping an additional 25% on $267 billion of Chinese imports.  With China importing less of our goods their potential recourse would be to sell US treasuries (flooding the market and causing our rates to spike), block mergers and acquisitions by U.S. companies worldwide, or the more likely scenario of harassing U.S. companies that do business in China.  In the short-term, it appears that China will wait until after the U.S. midterms to see how strong President Trump’s hand will be at that time. (more…)

You are the parent? So What?

Posted by on Oct 8, 2018 in blog | Comments Off on You are the parent? So What?

You are the parent? So What?

The applications are in, standardized tests are complete and a college decision has been made.  Time is racing as college acceptance notices soon lead to freshman move in day. Now all there is to do is buy dorm supplies and drop the kids off, right?  Wait! Maybe not.  A recent consultation with an attorney’s office opened our teams’ eyes to something that you may not have thought of before.

As a parent you spend years caring for the needs, wants, and wishes of your children and in a blink they are off to college on their own. Now may be the time to parent from a far. Consider an unsettling, but not unthinkable situation:  Your adult child is no longer living in your home. You get a call from a roommate or friend saying that there has been a medical emergency and your child is in the hospital.  Your first instinct is to call or rush to the hospital to find out what is happening, but you are denied access to any information.  If you are the parent(s), what can you do to ensure a hospital does not deny you information about the medical care of your loved one? (more…)

My Team, Our Team, Your Team

Posted by on Aug 2, 2018 in blog | Comments Off on My Team, Our Team, Your Team

My Team, Our Team, Your Team

 It has been a whirlwind since I joined the HFS Wealth Advisors Team back in January.  I am looking out my office window and I cannot believe it is July.  Where did the time go?

For you regular readers of HFS Headlines you are used to seeing valuable tips on topics like managing risk, tax changes, retirement, college planning, etc.  Down the road, you will likely see the same type of posts from me as well.  Now, however, I thought I would take a slightly different approach to my first post.

Coming to the HFS team after 20 years in retail banking has been a big learning curve for me from a job knowledge standpoint.  In preparation of my licensing, there have been countless hours of studying manuals, files and terminology.  When I feel like I cannot possibly cram one more thing into my brain, I try to take a step back and go to my “comfort zone” and remember the reason I joined the HFS team in the first place. (more…)

Global Asset Allocation Views – Q3 2018

Posted by on Jul 10, 2018 in blog | Comments Off on Global Asset Allocation Views – Q3 2018

Global Asset Allocation Views – Q3 2018

Global Asset Allocation Views – Q3 2018

                Markets have continued their wild ride in 2018 with U.S. markets gaining steam with the help of small caps.  Meanwhile, international markets have been damaged by political issues, the strengthening dollar, and the U.S. fed’s outlook on rate increases.  A populist government has been allowed in Italy where the far-right Lega, promising a lower flat tax, and the far-left 5-Star party, promising a universal basic income, will increase the budget without the required structural reforms needed.  In Spain, a minority government was formed by the center-left after ousting the prime minister and the troubles over secession by Catalonia continues.  Brexit negotiations continue to go nowhere as the March 29, 2019 deadline looms.  On top of this, European manufacturing has moderated while the ECB has stated they will end their QE (quantitative easing) program this December. (more…)