Wealth Management Blog | WrapManager

Gabriel Burczyk

Founder & CEO

Social Security Changes: How the Budget Agreement Affects Retirement Plans

Posted by Gabriel Burczyk | Founder & CEO

November 18, 2015

Social Security Changes: How the Budget Agreement Affects Retirement Plans

Investor concerns about another government shutdown were eased in late October, when Congressional leaders passed a bipartisan agreement that will provide relief from sequester cuts and avoid unnecessary debt defaults¹ (yes, we just wrote the words ‘bipartisan’ and ‘agreement’ in the same sentence).

A closer look at the budget agreement, however, revealed some changes to Social Security rules that will close the window – at least for now - on some unique Social Security Retirement Benefit ‘strategies’ that we’ve written about before.

The End of the “File and Suspend” Strategy

The first is the File and Suspend Strategy. Before this budget agreement, the file and suspend option allowed one person in a married couple to file for their benefit (thereby allowing the spouse to claim their benefit) but then immediately suspend it – allowing that future benefit to increase. You file, your spouse claims, then you suspend.

Cash Vs. Mortgage in Your Retirement Lifestyle Planning

October 6, 2015

Many people approaching retirement consider where they will live during their retirement years. Relocating to a more affordable or comfortable area could be an important part of your retirement lifestyle planning. Even if you plan to remain in your current home, however, your family nest egg will be influenced by your home financing. Cash vs. Mortgage Different schools of thought exist about whether it’s best to pay off your home and live debt free or carry a mortgage during your retirement years. It seems like a simple decision, but several factors complicate this decision. Further, there isn’t a one-size-fits-all answer to this question. Depending on your personal retirement lifestyle planning goals and your current situation, one of these options will likely be more advantageous than another. Your financial advisor can help you sort out the ramifications of whether to pay off your mortgage, carry a loan, or consider a reverse mortgage. [+] Read More

How Rising Interest Rates Affect Stocks and Bonds

September 16, 2015

Recent stock market volatility has given way to renewed curiosity over when the Federal Reserve (Fed) will start to raise interest rates in the U.S. A recently released poll by the National Association of Business Economics showed that just 37% of surveyed economists believed the Fed would hike rates in September, meaning that a majority of those surveyed think it will come even later in the year (if not next year).1 The question on many investors minds, however, isn’t so much when the Fed will start to raise interest rates, but how it will affect the economy and the stock market. Theoretically, as the Fed starts to raise interest rates, it becomes incrementally more costly for businesses and individuals to borrow money—meaning that economic activity could feel some headwinds over time. Investors often worry that rising interest rates could thus mean choking off the already fragile economic expansion, and that a slowing economy could mean falling stock prices. [+] Read More

How to Reduce Your Exposure to Cybersecurity Threats

August 11, 2015

At WrapManager, we take your data security very seriously. With all the media coverage of data breaches in the media today, we wanted to provide information that could help reduce your risk of being compromised with a short list of suggested ways to protect yourself while still enjoying the ease of managing your life using email and the internet. Here are few things you can do to improve your cybersecurity: Consider making requests regarding your account by phone and make sure there is a verification process in place at your financial institution for withdrawal of funds; [+] Read More

The Impact of Rising Interest Rates on Your Portfolio

June 17, 2015

You’ve probably heard it more than once in the last few months: the Federal Reserve appears likely to commence “lift-off” of interest rates at some point later this year. Some analysts believe the first rate hike could come this June, others point to September. At the end of the day, no one really knows for sure when that first hike will come (even the Fed is reluctant to commit to a defined timeframe). But there does seem to be consensus around one view: it will eventually happen. Source: Federal Reserve, FactSet, J.P. Morgan Asset Management. Market expectations are the federal funds rates priced into the fed futured market as of the date of the March 2015 FOMC meeting. *Forecases of 17 Federal Open Market Committee (FOMC) participants, midpoints of central tendency except for federal funds rate which is a median estimate. Data are as of April 30, 2015 Click to view larger image So what does that mean for investors? Do rising interest rates spell trouble for equities and the fixed income markets? Is now the time to adjust your investment portfolio? Using history and hard data as a guide, we’ll take a closer look. [+] Read More

5 Ways to Reduce Your Taxable Income in 2015

March 11, 2015

Check our our post: 3 Tips for Reducing Your Taxable Income in 2016. According to J.P. Morgan, the average American pays more in taxes than they do for food, clothing, and housing…combined. And, that only applies to income taxes! For investors, the cut often runs even deeper. Not only is your earned income reduced every year, but—J.P. Morgan also reveals that taxes on your investments can reduce an 8% annual return to as low as 5.2%.1 Click for larger view [+] Read More

What Falling Oil Prices Mean for Your Portfolio Strategy

January 14, 2015

Oil prices have moved around quite a bit over the last decade, but the pace and magnitude of the recent decline has investors wondering if there’s trouble ahead for the markets. Oil Prices Have Fluctuated Greatly in the Last Ten Years Click for larger view [+] Read More

Does it Still Make Sense to Diversify Your Portfolio?

December 16, 2014

As we approach the end of each year, we like to take a look back at which areas of the market outperformed others. As investors, this allows us to analyze why certain areas of the market may have done better than others, and it make us think about what we can expect looking forward into the coming year. Pulling up performance for this year-to-date (as of December 16th) shows us that US stocks as measured by the S&P 500 outperformed Europe, Asia and the Far East (EFA), and small cap stocks (IWM): Click for larger view These differences in performance may lead investors to wonder… [+] Read More

ISIS, Ebola, Vladimir Putin! Time to Change Your Portfolio Strategy?

November 13, 2014

Over the last few months, a string of global events have tested the markets. Whether it’s the spread of Ebola, the presence of terrorist group ISIS in Iraq and Syria, or the latest in the geopolitical chess match between Russia and the West, it seems there is no shortage of events that could impact the markets and your portfolio. The natural question on many investors’ minds is: will these events affect the upward market trend and is it time to adjust my portfolio? [+] Read More

5-Star Mutual Funds May Not Be Your Best Option – New Study Finds

October 16, 2014

The Wall Street Journal recently asked Morningstar to conduct a study on “five-star” mutual funds, to get an idea of how many were able to maintain their top rating over 10 years (July 2004 – July 2014). What they discovered will likely surprise you. Of the 408 mutual funds reviewed, the majority of them no longer had five stars. This and another study by S&P Dow Jones Indices underscore the common fallacy that investing in a five-star mutual fund increases the likelihood of a positive long-term outcome.1 Determining which funds to invest in should go well beyond a five-star rating system. In fact, you need a financial advisor who is dedicated to your needs and specializes in independent and ongoing assessment of investment options. High net worth investors should consider separately managed accounts instead of mutual funds given potential tax and visibility benefits. [+] Read More