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Acknowledging that the coronavirus has resulted in financial hardship for many individuals, Uncle Sam by way of the CARES Act has allowed for temporary suspension of certain rules and penalties for tapping one’s retirement plan this year if one is “qualified” under the Act, meaning either diagnosed or spouse or dependent diagnosed or proof of material adverse financial consequ

In our management of clients’ assets, we use exchange traded funds (or “ETFs”) for the majority of our investments. ETFs are a relatively newer form of a mutual fund which invest generally as passive indexes as opposed to traditional mutual funds which are actively managed. There are thousands of ETFs available which cover just about any type of investment one can think of.

The holidays are fast approaching. For many of us, it will be one of the strangest holiday seasons we've ever experienced due to COVID. Many of us will not be spending the holidays with family or perhaps we will share holiday cheer over zoom meetings.

Don't Be Surprised With a 10% Decline

The financial markets have come a long way since March when many "experts" predicted a further major decline in the stock market was inevitable. Those "experts" got it wrong.

Barron’s ran a story this weekend on Robinhood. Robinhood is a new free online trading platform that is targeting millennials. The concept of Robinhood is a good one: provide basic online financial advice and free trading to help (mostly younger) people get started in saving and investing for retirement. That said, there are elements of Robinhood that raise some concerns.

Khalil Parker and Deidre Downey have very little money in the bank, no savings for a down payment on the house they hope to buy and a 2-month-old baby. “We’ll sleep again someday,” Parker jokes. “Actually he’s a very chill little baby.” Parker, 33, and Downey, 32, have tiny balances in their retirement funds. Parker has student loan debt.

There has been debate over the years about whether men or women are better investors. Studies give women an edge over men with regard to investment performance. One recent study in particular is the Warwick (U.K.) Business School study of 2800 people that showed women outperforming both the market and their male counterparts. Several factors most likely account for this.

An interesting study from Morningstar shows that the relative outperformance of large “growth” stocks versus large “value” stocks may have reached an important apex in May of this year. The analysis goes back to 1937 and shows that the two other times in which this relative performance reached such an extreme were November of 1939 and February of 2000.

 

Much of what we do as financial planners involves forward-looking assumptions around things such as inflation, the economy, and financial market returns. One might question how, as planners, we can have any real confidence in making forward projections in the face of high uncertainty, particularly the current environment.