May 15, 2019

Many investors aren’t aware of the concept of fee-only financial planning, so we’re sending along the article below from Financial Planning Magazine¹ because it’s the best one we’ve seen written on the subject in years.

Written by Bob Veres, a well-respected industry observer for decades, it’s clearly sarcastic in tone. It’s intent, however, is to point out the players in the personal finance marketplace and the incentives behind their compensation.

Source: Direxion Funds

May 15, 2019

• FUTURE PLANS - 48% of households in America headed by individuals at least age 55 have no retirement savings, 26% have a defined contribution (DC) plan (e.g., 401(k) or IRA) but no defined benefit (DB) pension plan, and the remaining 26% have both a DC and a DB plan (source: Government Accountability Office).

• PREPARE FOR IT - A 65-year old American couple has a 48% chance that at least one of them will live to age 90, i.e., at least a 25-year life expectancy (source: Social Security Administration).

• END OF LIFE - 1 out of 3 Americans at least age 85 has Alzheimer’s (source: The Atlantic).

March 31, 2019

By: John Zeltmann

Stan and I will both tell you we have one of the greatest jobs in the world. Helping people plan for their retirement while making financially sound decisions during their working years is an incredibly rewarding vocation. Daily, we get to help people figure out how to reduce tax bills, determine appropriate levels of life insurance, plan for college, and prudently grow their portfolios over time. Those are just some of the highlights.

When we have those types of conversations with the children of our clients, the rewards can be just as profound. 

Source: Direxion Funds

March 31, 2019

• ALMOST ALWAYS - Since 1950, there have been 60 different 10-year periods (i.e., the 10-years from 1950-59, 1951-60, 1952-61, . . . 2009-18). The S&P 500 has produced a positive total return result in 58 of the 60 decade-long periods, i.e., 97% of the time. The S&P 500 consists of 500 stocks chosen for market size, liquidity and industry group representation. It is a market value weighted index with each stock's weight in the index proportionate to its market value (source: BTN Research).

• ECONOMIC DOWNTURN - 9 of the last 10 recessions in the United States began under a Republican president going back 66 years to 1953. The only recession over this time span that began with a Democratic president in the White House was a 6-month recession that began in January 1980 during Jimmy Carter’s last year as president (source: National Bureau of Economic Research).

February 15, 2019

Financial planning is part art and part science. The science portion relates to the use of academic studies to construct portfolios with various levels of risk that can be used to provide retirees a certain level of income for their lifetime. The art element is equally important because we deal with individuals, and each individual has unique needs, disciplines, and tolerances.

Source: Direxion Funds

February 15, 2019

January 14, 2019

At year-end, mutual fund companies often distribute gains to shareholders in the form of capital gains distributions. Even if the fund is down for the year, shareholders may have a tax liability in their taxable accounts. These distributions are sent to investors via check, automatically deposited as cash to their brokerage account, or reinvested into the issuing mutual fund.  For those investors receiving the cash distributions, many see them as welcome arrivals - year-end bonuses, if you will.  It's not quite that simple.

Source: Direxion Funds

December 31, 2018

November 15, 2018

I recently read an article in an industry journal¹ titled: “You Can’t Win if You’re Afraid to Lose.” The tagline was: “To experience higher potential gains, clients need to be willing to tolerate occasional losses.”

Source: Direxion Funds

November, 15 2018

• A greater percentage of Millennials have all of their pre-tax retirement money invested in cash and bonds (20%) than those that have all of their pre-tax retirement money invested in stocks (19%). 2,593 Millennials (ages 20-36 in 2017) were surveyed in the 4th quarter 2017.

• 47 investment bankers worldwide received jail time as a result of the 2008 global recession, including 25 bankers from Iceland. Just 1 American investment banker went to prison, receiving a 30-month sentence for “fraudulently inflating” the prices of mortgage-backed securities.

• 618 US employers surveyed in the 1st quarter 2018 anticipate offering a starting base salary of $65,000 to college graduates with a bachelor’s degree, $85,000 to workers coming “direct-from-industry” and $105,000 to MBA graduates.