Wealth Management Blog | WrapManager (43)

Is Your Retirement Portfolio Diversified Enough for this Market?

Posted by Michael J. O'Connor | CWS®, Vice President Investments

October 21, 2014

Is Your Retirement Portfolio Diversified Enough for this Market?

For investors who are heavily invested in the US markets, there may have been some disappointment when they saw their returns during the six month period ending in September. The S & P 500 has shown an 8.3% return year to date as of September 30th, but some overseas markets such as India (+24.7% over the same time period) have shown higher returns.¹

Portfolio diversification strategy is important for all investors. While diversification does not guarantee profit or protect against loss in declining markets, investing mainly in US stocks (or any single country or region) can be harmful to your portfolio and ability to reach your goals. The below chart demonstrates the importance of a balanced portfolio and shows how different markets and asset classes can perform well one year, and not so great the next year.

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Portfolio Diversification

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

Year-End Investment Planning Checklist for 2014

October 15, 2014

It’s that time of year again—time to look back, review your investments and look forward to the coming year. Below are a few areas and tips to review with your Wealth Manager during your upcoming quarterly review. Be sure to provide as much information as possible so that any needed adjustments can be made to your investment plan, accounts and investments. Tax Planning Strategies Capital losses are deductible against capital gains. In 2014, up to $3,000 in net capital losses may be deducted against ordinary income. If you had net capital loss amounts in excess of $3,000, you may carry the excess forward indefinitely.1 [+] Read More

Getting Through the Next Stock Market Correction

October 14, 2014

Getting through stock market corrections begins before they happen. While it is almost impossible to predict exactly when a market correction will begin and end, there are things you can do now to help reduce the stress felt by many investors during these events. Remember that corrections are temporary and a normal part of healthy markets. You can get through any stock market correction if you have the right frame of mind, adhere to a few basic guidelines and use your financial advisor as a sounding board. Avoid Hasty Investment Decisions It’s normal to feel anxious during corrections and think about changing direction with your investments. But timing the market rarely, if ever, works. By the time you’ve made a decision to change investments, it’s possible the correction could be half over. Once you’re out of the market, the next decision is when to get back in, which is also timing the market. [+] Read More

Research Money Managers with the Money Manager Directory

October 9, 2014

WrapManager’s Money Manager Directory helps investors find and request information on money managers and their strategies. This information is often hard to find and can be biased, especially if the money manager is providing it to you themselves. Information may include: Performance information Comparison to similar investment strategies In depth strategy information How the strategy could fit into your portfolio One of our Wealth Managers will reach out to you with the information. If it’s not available, they can show alternative money manager strategies that we recommend to appropriate clients and how they could work for you. [+] Read More

Updated Guide to the Markets for Q4 - JP Morgan

October 8, 2014

JP Morgan’s quarterly Guide to the Markets provides a wealth of information about the economy, stocks, fixed income and international markets, mainly displayed in easy to understand charts and graphs. It represents a one-stop shop for information that is often hard to find and scattered among multiple sources. These are just a few pieces of information you will find in the Guide: The current state of the US and international economies Interest rates and inflation Annual returns and intra-year declines Fixed income sector returns Outlook for US, international and emerging stock markets Download the Guide Here [+] Read More

Ladies, Don’t Make this Social Security Mistake

October 7, 2014

There’s no disputing the fact that women live longer than men, but, according to a Nationwide Financial survey, only 3 percent of women wait to take their social security benefits until they’re qualified to receive the maximum amount. The decision to start receiving social security benefits at the full retirement age of 66, or even to start collecting them early at age 62, means that women can miss out on hundreds of thousands of dollars of much-needed retirement income - a social security mistake to avoid if possible. One in four women reaches the age of 92, and with rising healthcare costs, it’s increasingly important that women work with a financial advisor to create and monitor a retirement income plan. However, only 33 percent of women currently work with financial advisors. Those who don’t work with financial advisors are nearly three times as likely to report that their Social Security payments are less than they anticipated.1 [+] Read More

Keep Your Retirement Plan on Track with Quarterly Reviews

October 2, 2014

Your Financial Advisor is there to keep an eye on your investments and make adjustments to keep your finances on track. But if your journey through retirement is going to stay on track, you should regularly check in with your Financial Advisor as your life and the economy change. These reviews (at least quarterly) give you an opportunity to evaluate your goals and make adjustments to your investment and retirement income plan. They also help make sure your investment strategies are still appropriate for you. It is also a good time to take care of housekeeping items such as updating beneficiaries. Tasks like these may seem minor, but they could have a big impact on your finances if they’re neglected. It doesn’t take long to review your investment plan with your Financial Advisor. Just an hour or two per quarter can keep everyone on the same page and help you to meet your goals. [+] Read More

Social Security Strategies for Divorced Spouses

October 1, 2014

Planning for Social Security benefits is complex, and if you’re divorced, you may have wondered how spousal benefits will work for you in your retirement years. One thing is for certain: when it comes to Social Security, timing is everything. Knowing and understanding your options can help improve your retirement income plan. General Options Just as there is flexibility for married retirees, divorced retirees have several options when it comes to Social Security. Spousal benefits are generally 50% of your ex-spouse’s full retirement benefits if you file at your full retirement age (66). [+] Read More

Retirees Beware: Popular Investments You May Want to Avoid

September 30, 2014

There was once a time when investing in the markets was as simple as choosing how much money to have in stocks, versus bonds, versus cash in the bank. Since that time the investment landscape has evolved and the menu of investment options has grown, giving you several products like hedge funds, annuities, ETFs, mutual funds and private REITs. Unfortunately, many of these investments often lack transparency and come with hidden risks and inconsistent returns. Take care in analyzing these three investments as you work with your financial advisor to plan your investment portfolio and retirement income plan. [+] Read More