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Slick TV ads often make financial planning and wealth management sound simple, but it’s usually not. Managing wealth requires knowing a lot about highly technical topics, like taxes, government regulations, and finance as well as history, psychology and how to communicate with loved ones about sensitive issues. This article highlights some of the knowledge needed to manage wealth and why it’s often so daunting without the help of an independent personal financial advisor who is familiar with your situation.
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Fed Governor Kugler Details Inflation And Economic Outlook
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Why Rates May Not Be Cut Until June
The cost of a loan to buy a home, car, college education, and achieve the American Dream is staying the same for now. As expected, Federal Reserve Chairman Jerome Powell said the central bank did not lower loan rates following the Fed’s Wednesday, Jan. 31, 2024, policy meeting.
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Practical Suggestions For Achieving Your 2024 Resolutions
New Year’s resolutions usually fail because they‘re often too hard to achieve. After six months, only 10% of people who make resolutions achieve them or remain committed to them, , according to a study by Dr. Mark Griffiths, a Chartered Psychologist and Distinguished Professor of Behavioral Addiction at the Nottingham Trent University. What can you do to make financial, medical, or other personal resolutions more likely to be achieved?
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A Sign Of Progress In Solving U.S. Economic Problems
The Federal Reserve appears to be pulling off a feat most experts did not believe it could: ending its aggressive inflation-fighting campaign of 11 interest rate hikes without tipping the U.S. economy into a recession.
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Fed Keeps Rates Unchanged; Expects Easing In 2024
To promote transparency and free markets, the Federal Reserve System began publishing the opinions of the 19 U.S. central bankers that decide interest rate policy.
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Have You Logged Into Your Social Security Account?
Have you logged in to your Social Security account? Creating an online account at SSA.gov is an important first step in understanding your retirement income situation. However, only about 60 million of the 160 million individuals in the U.S. labor force who have Social Security accounts have created a way to access the Social Security Administration’s website.
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The Great Fake Out Of 2023 Is Poised To Extend Into 2024
All year long, the economy and stock prices have fooled experts and consumers, outperforming expectations month after month.
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Test Your Financial Planning IQ
The five questions below are a challenge meant to allow you to assess your knowledge of investing, tax and financial planning. If you have been following our news stream, this quiz draws on familiar ground. The answers are below.
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Planning Briefs
China Poses A Hidden Risk For Many 401(k)s
Published Wednesday, February 12, 2020 at: 7:00 AM EST
The coronavirus has focused renewed attention to the risk of investing in China, but China may pose a hidden risk to retirement investors holding emerging markets funds.
More than a third of emerging markets funds typically are comprised of Chinese stocks. For example, 35% of the holdings of the MSCI Emerging Markets Index, the widely used index against which emerging markets investments are benchmarked, are in Chinese stocks. Many 401(k) investors may be unaware that a third of their emerging markets investments are invested in China.
The longer-term risk posed by investing in China is reflected in this chart of the Standard & Poor's 500 performance versus an index representing emerging markets. Since Chinese stocks commonly dominate holdings of emerging markets investments, Chinese stock market returns have dominated the performance of emerging markets investments.
Although financial news headlines have focused on the risk to the Chinese economy posed by coronavirus, the outbreak is actually likely to be only a temporary negative. However, the longer-term risk of owning Chinese stocks is illustrated in the relatively poor performance of emerging markets versus U.S. stocks.
Since the China economic boom from 2003 to 2007, the MSCI Emerging Markets Index has gone sideways for 12 years. Meanwhile, U.S. stocks soared, more than doubling, in the longest bull market in modern U.S. history.
To be clear, since 2007, when the rate of growth of China's gross domestic product peaked at about 18%, the MSCI Emerging Markets index has not shown a net gain. That's for 12 years! That's the hidden risk of Chinese stocks.
If you have questions about emerging markets, investing in China, or about asset allocation of your portfolio, please contact our office.
The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is a market-value weighted index with each stock's weight proportionate to its market value. Index returns do not include fees or expenses. Investing involves risk, including the loss of principal. Past performance is no guarantee of future results. Return and principal value of an investment will fluctuate, and when redeemed, may be worth more or less than their original cost. Performance statistics quoted here may be lower or higher now.
Nothing contained herein is to be considered a solicitation, research material, an investment recommendation or advice of any kind., and it is subject to change without notice. Any investments or strategies referenced herein do not take into account the investment objectives, financial situation or particular needs of any specific person. The material represents an assessment of financial, economic and tax law at a specific point in time and is not a guarantee of future results.
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