September is Life Insurance Awareness Month. Protecting the people we love the most is incredibly important, yet approximately 30% of American households have no life insurance, and over 50% think they are under insured.
Why does a car have a spare tire that almost never gets used? Why does a football team usually keep at least one, if not two backup quarterbacks that hardly play? Why do beach communities have evacuation plans against hurricanes that rarely strike? The simple answer for all three examples is “just in case.” Should the positive expected outcome turn into a negative, having a plan in place would help you be prepared. This is why sound financial plans include a contingency; in case of death, disability or job loss. (We’ll discuss disability and job loss in future posts.)
There is certainly no argument that it is more fun to talk about accumulating wealth, sending children to college, taking vacations, and buying houses then it is to talk about death. In my 20+ years of experience in the financial and insurance industry, I have found that many people are uncomfortable contemplating death, let alone having a conversation about it and how life insurance can help prepare for a family’s financial future. Avoiding the subject, won’t make it go away! So, before considering the purchase of a policy, I would recommend you take time to learn about the types of life insurance available.
There are two categories of life insurance, temporary and permanent. Let’s briefly look at what they are and how they work. Continue reading
Summer vacation is over and children are going back to school. As kids return to the classroom to learn the fundamentals of the “three Rs” (reading, ‘riting, and ‘rithmetic — but clearly not spellin’), in this commentary we return to the basic fundamentals of investing and look at some of the basic drivers of stock prices. To do that, we discuss our own version of the three Rs that underpin our positive stock market outlook for the balance of 2014: revenues, reinvestment, and renaissance. Read the entire LPL Research Market Commentary here.
Six months ago, as my car’s GPS directed my car up Gum Street to McNeely Avenue, I got my first glimpse of what would be my new place of employment. From the first look at the grand restored gem at 139 W. McNeely in Mooresville, I sensed that this was a special place. But I had no idea how special it really was and how hard Jeff & Maryann Karp, the current owners, had worked, to restore it to its present state.
Let me start with a little history. The house was built in 1907 by Arthur Weston Colson, and while not the oldest in town, it is certainly one of the oldest. Mr. Colson’s daughters Lilyan and Lorna returned from college, and lived in this home together for their entire lives, never marrying. As teachers, they contributed their knowledge and education passions to the community. One little known fact was that Lilyan, the older sister, was the first baby baptized at St. Mark’s Lutheran Church in Mooresville, where she remained a member until she died at age 98.
Posted in Jeffrey Karp, Keren Kurti Alexander, Permission Granted, Personal Finance
Tagged DIY, Do It Yourself, Downtown Mooresville, Historical Home, Historical Preservation, Mooresvile History, Mooresville, Renovation, Victorian
With the midterm elections now just two months away and campaigning starting to heat up, we thought we would share our current views on the political landscape and what it may mean for U.S equities. In our two Outlook 2014 publications for this year, we posited that the U.S. economy and corporate profits may drive the stock market higher and investors could turn their attention away from policymakers in Washington, who were such a distraction in 2013 and earlier in the current economic expansion.
We continue to see opportunities for further stock market gains over the course of 2014, as discussed in our Mid-Year Outlook 2014: Investor’s Almanac Field Notes, based upon fundamentals rather than the potential for sweeping legislative change. Although our analysis of stock market performance around midterm elections is very supportive of our positive stock market outlook, it is not a key driver of that outlook. Continued.
In only 10 days, the NFL regular season begins. Teams and coaches will be analyzing each other’s moves and plays, looking for any indication that can give them an edge to succeed. Some will play strong offense, others good defense from the moment of the first kickoff. Although some big plays could happen during the first kickoff or first hike, we know this only the start of the game, and in turn only the start of the season. History suggests the same is true for the first Federal Reserve (Fed) interest rate hike as it relates to the stock market and economy.
While football teams are looking for an edge against their opponents on the field, investors will be keeping a close eye on the Fed to try and gain an edge as to when it will finish winding down its bond-buying program (quantitative easing 3) and eventually begin hiking short-term interest rates. Read the full weekly market commentary from LPL Research here.
Since the dawn of financial markets, investors have been searching for signals of impending declines. Many economic indicators correlate highly with the stock market, which means they are coincident and not leading, and they tend to move at the same time as stocks. Some are lagging, meaning they move after stocks, which of course is not very predictive. An important goal for all investors is to find leading indicators in an attempt to anticipate big down moves.
One leading indicator that we have found with reliable predictive power is the Conference Board Index of Leading Economic Indicators (LEI). It is always difficult to predict small stock market pullbacks, such as the two 4 – 6% drops that the S&P 500 Index has experienced in 2014. Such pullbacks can be driven by temporary fears and can contrast with the fundamental underpinnings of the market. Larger, longer-lasting pullbacks are usually driven by deteriorating economic or fundamental data that can be foreshadowed by the LEI. The LEI data for July are due out on Thursday, August 21, 2014. Read more here.
Volume has picked up during the recent downturn. No, we are not talking about trading volumes; we are talking about the volume from your TVs with talking heads warning about an impending stock market downturn. If you turn off the TV and focus on what the market is telling you, rather than the talking heads, you can tune out the noise. The way we listen to the market in our investment process is through technical analysis, where we assess the behavior of the market and its underlying drivers. Analyzing market breadth has been an especially useful technical analysis tool for predicting recessions and bear markets. There are various ways to look at market breadth, and we will be looking at two critical areas in this week’s commentary. Read more here.
I confess: this weekend, I could not help myself. While watching some TV, I stopped on a rerun of the show “Mr. Ed”. I realize that some of my readers just did a memory flashback, and others (generally, Gen X and younger) may have no idea what I am talking about.* To make matters worse, I also found a channel that was promoting an eight CD compilation of 1960’s & 1970’s music, complete with pictures of the bands. What a walk down memory lane for my wife and me!
As a group, us Baby Boomers love to reminisce about the music we grew up with (Beatles, Stones, Disco (for us late Boomers)), events that occurred (man on the moon, first TV, political events, etc.) or the life values that are important to us. Through my years of advising clients, I have realized that it is the sum total of all of our experiences, that make up the essence of our opinions about money. These same experiences are also at the core of our vision of what life after our primary career might look like. And now, we are getting to a point in life where what we need to achieve is becoming less important than how we enjoy what we have achieved. I’ve advised many people for whom this particular shift was really difficult. The three top changes that people struggle with seem to be:
- A downshift in the pace of life: We have been on the go for so long, while we built careers, raised families, etc. that even a slight downshift is a big adjustment.
- A change in motivation of activity: No longer is money the main driver. Passion activities, charitable interests, and the desire to make a difference take over.
- Health changes: While most of us are taking pretty good care of ourselves, it just isn’t like it used to be. Attention to the future healthcare needs can add to the emotional stress of this transition period.
So how do you successfully make this shift? Do you meet the challenge on your own or do you just ignore the whole thing and hope it all works out? With today’s average life expectancy for a 65 year old woman at 86, and for a man 84**, do you really want to rely on luck for a positive outcome?
Amid the barrage of nearly constant economic and market data, nothing is more important to assess the health of corporate America than the quarterly check-in that we affectionately call earnings season. As earnings season approaches its halfway mark, it’s a good time to take a look at what we’ve learned so far. Check out this edition of LPL Research’s Weekly Market Commentary for Burt White and Jeffrey Buchbinder, CFA’s take on current conditions: