Published: Fri, 22 Jan 2021 21:04:05 +0000
Market Blog 1/22/2021 Index Performance View enlarged chart. US and International Equities The major market indexes finished the week higher. The tech-heavy NASDAQ had a solid week returning over 4%. In addition, many international markets followed in lockstep with their … Continue reading →
Published: Fri, 22 Jan 2021 17:00:23 +0000
Economic Blog 1/22/21 It has been exactly one year since the first COVID-19 case in the United States was reported to the Centers for Disease Control (CDC), and to say the world as we know it has been completely changed … Continue reading →
Published: Fri, 22 Jan 2021 16:00:54 +0000
Friday, January 22, 2021 Top Story Stocks take a pause as investors reassess risk appetite US stocks opened firmly lower after the S&P 500 Index reached another all-time high Thursday. European markets are lower in midday trading as the European … Continue reading →
Published: Thu, 21 Jan 2021 16:59:16 +0000
Economic Blog 1/21/21 The onset of the global pandemic shocked the economy and triggered one of the deepest recessions ever in 2020. As investors fled to “safe haven” Treasuries and the Federal Reserve (Fed) lowered interest rates, the yield on … Continue reading →
Published: Thu, 21 Jan 2021 16:00:19 +0000
Thursday, January 21, 2021 Top Story Low Mortgage Rates Add Fuel to Housing Boom The national average 30-year fixed mortgage rate continues to decline, falling below 2.9% as the housing market remains one of the hottest areas of the economy. … Continue reading →
Published: Wed, 20 Jan 2021 16:00:46 +0000
Wednesday, January 20, 2021 Top Story Inauguration Day in the United States Joseph R. Biden, Jr. will become the 46th President of the United States today. He is expected to issue sweeping executive orders that focus on the environment, immigration, … Continue reading →
Published: Wed, 20 Jan 2021 15:04:04 +0000
Market Blog 1/20/2021 Today Joe Biden becomes the 46th President of the United States. We’ve already looked forward at what his presidency, coupled with a blue wave in Congress, could mean for policy in Market Policy Projections for 2021, so … Continue reading →
Published: Tue, 19 Jan 2021 17:10:21 +0000
Economic Blog 1/19/2021 Investment-grade credit spreads, the extra yield you get from investment-grade corporate bonds compared to similarly dated US Treasuries, have already tightened to a level you usually only see during the middle of the economic cycle—and that can … Continue reading →
Published: Tue, 19 Jan 2021 16:00:42 +0000
Tuesday, January 19, 2021 Top Story Market Signals Covers It All This week’s Market Signals podcast covers all the latest events impacting markets and the economy: Q4 earnings, a new stimulus proposal, the Democratic blue wave, and President-elect Joe Biden’s … Continue reading →
Published: Fri, 15 Jan 2021 21:12:53 +0000
Market Blog January 15, 2021 Index Performance US and International Equities The major market indexes finished the week lower. In addition, many international markets followed in lockstep with their US counterparts. Emerging markets (MSCI EM Index) outperformed developed international markets … Continue reading →
Published: Fri, 15 Jan 2021 17:00:19 +0000
Economic Blog January 15, 2021 One of the top questions we’ve received recently has been what a blue wave may mean for investments. After the Democrats won the two Senate runoff elections in Georgia, they will now control the White … Continue reading →
Published: Fri, 15 Jan 2021 16:00:02 +0000
Friday, January 15, 2021 Top Story Retail Sales Worse Than Expected Retail sales in the United States declined 0.7% month over month in December, below all but two of the 70 forecasts in Bloomberg’s consensus survey (US Census Bureau). The … Continue reading →
Published: Thu, 14 Jan 2021 17:25:56 +0000
Market Blog January 14, 2021 Heading into 2020, we maintained our preference for growth stocks as we believed that earnings growth would become harder to come by as the economic cycle aged, and their robust earnings growth was greatly appealing. … Continue reading →
Published: Thu, 14 Jan 2021 16:00:27 +0000
Thursday, January 14, 2021 Top Story New Street View Video Sets Positive Tone The stock market has started off 2021 surprisingly well, and LPL Research Chief Market Strategist Ryan Detrick says this bull market is alive and well. “Surprises to … Continue reading →
Published: Wed, 13 Jan 2021 17:00:38 +0000
Economic Blog 1/13/21 Rising COVID-19 cases and concern about the policy environment put a dent in small business optimism in the month of December, the index’s second straight monthly decline. As shown in the LPL Chart of the Day, the … Continue reading →
Published: Wed, 13 Jan 2021 16:00:57 +0000
Wednesday, January 13, 2021 Top Story Consumer prices in line with forecasts Consumer inflation for December, based on the Consumer Price Index (CPI), grew 0.4% month over month, buoyed by higher gasoline prices. Core inflation, excluding food and energy prices, … Continue reading →
Published: Tue, 12 Jan 2021 17:00:41 +0000
Economic Blog 1/12/2021 Treasury yields hit two key levels the first week of 2021. As shown in the LPL Chart of the Day, the 10-year Treasury yield moved above 1% for the first time since March 2020, and the 10-year … Continue reading →
Published: Tue, 12 Jan 2021 16:00:55 +0000
Tuesday, January 12, 2021 Top Story 2021 Policies Update and the Markets In this week’s Market Signals podcast and video, LPL Research talks about 2021 policy updates and the possibilities of higher taxes and more regulation, more stimulus, higher Treasury … Continue reading →
Published: Mon, 11 Jan 2021 16:00:53 +0000
Monday, January 11, 2021 Top Story Stocks open modestly lower as investors reassess risk sentiment. The US dollar traded higher with demand supported by higher Treasury European stocks pulled back from a 10-month high in midday trading as Germany underperforms. … Continue reading →
Published: Fri, 08 Jan 2021 21:00:11 +0000
Market Blog January 8, 2021 Index Performance View enlarged chart. US and International Equities This week, we gained clarity on the makeup of Congress with the Georgia US Senate runoff. Democrats will now have control of both chambers of Congress, … Continue reading →
Published: Fri, 08 Jan 2021 17:00:59 +0000
Economic Blog 1/8/2021 The differences in strength between the stock market and real economy were laid bare this week as the stock market surged to new highs while the jobs market continued to deteriorate and remains well short of its … Continue reading →
Published: Fri, 08 Jan 2021 16:00:05 +0000
Friday, January 8, 2021 Top Story Jobs Growth Turns Negative The US economy lost 140,000 jobs in December, according to the US Bureau of Labor Statistics, missing Bloomberg survey estimates of a 50,000 gain. This represents the first monthly loss … Continue reading →
Published: Thu, 07 Jan 2021 18:19:52 +0000
Markets Blog 1/07/21 2020 was a good year for stock investors despite unprecedented challenges. After being down more than 30% at the March 2020 lows, the S&P 500 Index ended the year with a solid 18.4% total return. Last year … Continue reading →
Published: Thu, 07 Jan 2021 16:23:11 +0000
Thursday, January 7, 2021 Top Story LPL Research Condemns Violence in Washington, DC LPL Research condemns the violent actions at the US Capitol Building on Wednesday and hopes for healing in our nation’s political and societal divides. We fully support … Continue reading →
Published: Wed, 06 Jan 2021 17:00:50 +0000
Market Blog January 6, 2021 Well, we can officially say goodbye to 2020. Although there still will be many challenges in 2021, we do see much better times ahead. Just how amazing was it? “2020 will go down in history … Continue reading →
Published: Wed, 06 Jan 2021 16:00:44 +0000
Wednesday, January 6, 2021 Top Story 2020 in 20 Charts 2020 was a historic year in many ways, which made it hard to highlight just a few charts. So in honor of 2020, we picked 20 charts that show how … Continue reading →
Published: Tue, 05 Jan 2021 18:18:28 +0000
Economic Blog 1/5/2021 US investment-grade bonds had a solid 2020 despite a tumultuous year overall. The broad Bloomberg Barclays US Aggregate Bond Index had a total return of 7.5%—not as strong as 2019’s 8.7% but its fifth-best year in the … Continue reading →
Published: Tue, 05 Jan 2021 15:57:24 +0000
Tuesday, January 5, 2021 Top Story 10 Lessons LPL Research Learned in 2020 LPL Research reviews its top 10 takeaways from 2020, the year-end Santa Claus Rally, and what the markets are saying about the Georgia runoffs in this week’s … Continue reading →
Published: Mon, 04 Jan 2021 17:46:29 +0000
Market Blog View enlarged table. US and International Equities The S&P 500 Index, Dow Jones Industrial, and Nasdaq Composite indexes, continued their November run in December. As noted last month, November was a record-breaking month for equities, thanks to … Continue reading →
Published: Mon, 04 Jan 2021 16:42:25 +0000
Monday, January 4, 2021 Daily Insights Markets start the New Year higher. US markets continue their trek higher following last year’s nine-month rally. Market participants appear optimistic for a better 2021 in the wake of COVID-19 vaccine progress and December’s … Continue reading →
Published: Thu, 31 Dec 2020 21:02:00 +0000
Market Blog 12/31/2020 US and International Equities As we finish out a challenging year this week, Congress passed COVID-19 relief, providing increased unemployment benefits, small business assistance, along with an additional $600 stimulus payment. In addition, Congress is presently in … Continue reading →
Published: Thu, 31 Dec 2020 16:00:51 +0000
Thursday, December 31, 2020 Happy New Year to all from LPL Research! We made it through a very challenging 2020. Have a happy, healthy, and safe 2021. Top Story What a big end of year rally means. The S&P 500 … Continue reading →
Published: Thu, 31 Dec 2020 13:00:51 +0000
Market Blog 12/31/2020 Welcome to the last day of 2020! It has been a devastating year in so many ways, yet for investors it has been quite rewarding. Much of the gains in 2020 have taken place the final two … Continue reading →
Published: Wed, 30 Dec 2020 17:00:47 +0000
Economic Blog 12/30/20 For many economic data series, 2020 has been a roller coaster. Not for housing, however. The onset of the COVID-19 pandemic and social distancing measures jump-started the “nesting” behavioral shift away from urban apartments and into single-family … Continue reading →
Published: Wed, 30 Dec 2020 16:00:31 +0000
Wednesday, December 30, 2020 Top Story Home prices continue to climb. While some industries continue to struggle during the pandemic, housing data in the United States (US) remains a strong point of the US economy. Standard & Poor’s 20-city composite … Continue reading →
Published: Tue, 29 Dec 2020 17:54:05 +0000
Economic Blog 12/29/2020 2020 was an extraordinary year for the Federal Reserve (Fed). The Fed responded swiftly and decisively to the rapidly accelerating financial and economic uncertainty brought on by efforts to contain the COVID-19 pandemic. The current Fed was … Continue reading →
Published: Tue, 29 Dec 2020 16:00:03 +0000
Tuesday, December 29, 2020 Top Story Lessons learned from the Fed in 2020. The Federal Reserve (Fed) will remain in focus for markets in 2021. “Don’t fight the Fed” seems like obvious investor guidance in hindsight, but it didn’t in … Continue reading →
Published: Mon, 28 Dec 2020 16:00:31 +0000
Monday, December 28, 2020 Top Story Solid holiday shopping season. Holiday sales grew 3%, beating forecasts for a 2.4% increase according to MasterCard’s SpendingPulse. Online sales rose 49% year over year. These results were impressive for a recessionary period—the comparable … Continue reading →
Published: Thu, 24 Dec 2020 17:28:26 +0000
Market Blog 12/24/2020 Data is as of 11:15 AM ET View enlarged chart. US and International Equities This week, concerns about a new COVID-19 strain in the United Kingdom along with new lockdown restrictions have weighed on the markets even … Continue reading →
Published: Thu, 24 Dec 2020 16:00:25 +0000
Thursday, December 24, 2020 Top Story Markets Close Early Today The NYSE and NASDAQ will close at 1 p.m. ET today. The bond markets will close at 2 p.m. ET. All markets will be closed Friday, December 25, and will … Continue reading →
But how do you pursue that vision? Social Security benefits may not provide enough income for your retirement years. And unfortunately, few employers today offer a traditional company pension plan that guarantees you a specific income at retirement. On top of that, people are living longer and must find ways to fund those additional years of retirement. Such eye-opening facts mean that today, sound retirement planning is critical.
It's common to discuss desired annual retirement income as a percentage of your current income. Depending on who you're talking to, that percentage could be anywhere from 60 to 90 percent, or even more. The appeal of this approach lies in its simplicity. The problem, however, is that it doesn't account for your specific situation. To determine your specific needs, you may want to estimate your annual retirement expenses.
Use your current expenses as a starting point, but note that your expenses may change dramatically by the time you retire. If you're nearing retirement, the gap between your current expenses and your retirement expenses may be small. If retirement is many years away, the gap may be significant, and projecting your future expenses may be more difficult.
Remember to take inflation into account. The average annual rate of inflation over the past 20 years has been approximately 2.5 percent. (Source: Consumer price index (CPI-U) data published by the U.S. Department of Labor, 2013.) And keep in mind that your annual expenses may fluctuate throughout retirement. For instance, if you own a home and are paying a mortgage, your expenses will drop if the mortgage is paid off by the time you retire. Other expenses, such as health-related expenses, may increase in your later retirement years. A realistic estimate of your expenses will tell you about how much yearly income you'll need to live comfortably.
Once you have estimated your retirement income needs, take stock of your estimated future assets and income. These may come from Social Security, a retirement plan at work, a part-time job, and other sources. If estimates show that your future assets and income will fall short of what you need, the rest will have to come from additional personal retirement savings.
By the time you retire, you'll need a nest egg that will provide you with enough income to fill the gap left by your other income sources. But exactly how much is enough? The following questions may help you find the answer:
When you know roughly how much money you'll need, your next goal is to save that amount. First, you'll have to map out a savings plan that works for you. Assume a conservative rate of return (e.g., 5 to 6 percent), and then determine approximately how much you'll need to save every year between now and your retirement to reach your goal.
The next step is to put your savings plan into action. It's never too early to get started (ideally, begin saving in your 20s). To the extent possible, you may want to arrange to have certain amounts taken directly from your paycheck and automatically invested in accounts of your choice (e.g., 401(k) plans, payroll deduction savings). This arrangement reduces the risk of impulsive or unwise spending that will threaten your savings plan--out of sight, out of mind. If possible, save more than you think you'll need to provide a cushion.
You need to understand the types of investments that are available, and decide which ones are right for you. If you don't have the time, energy, or inclination to do this yourself, hire a financial professional. He or she will explain the options that are available to you, and will assist you in selecting investments that are appropriate for your goals, risk tolerance, and time horizon. Note that many investments may involve the risk of loss of principal.
The following are among the most common retirement savings tools, but others are also available.
Employer-sponsored retirement plans that allow employee deferrals (like 401(k), 403(b), SIMPLE, and 457(b) plans) are powerful savings tools. Your contributions come out of your salary as pretax contributions (reducing your current taxable income) and any investment earnings are tax deferred until withdrawn. These plans often include employer-matching contributions and should be your first choice when it comes to saving for retirement. 401(k), 403(b) and 457(b) plans can also allow after-tax Roth contributions. While Roth contributions don't offer an immediate tax benefit, qualified distributions from your Roth account are federal income tax free.
IRAs, like employer-sponsored retirement plans, feature tax deferral of earnings. If you are eligible, traditional IRAs may enable you to lower your current taxable income through deductible contributions. Withdrawals, however, are taxable as ordinary income (unless you've made nondeductible contributions, in which case a portion of the withdrawals will not be taxable).
Roth IRAs don't permit tax-deductible contributions but allow you to make completely tax-free withdrawals under certain conditions. With both types, you can typically choose from a wide range of investments to fund your IRA.
Annuities are contracts issued by insurance companies. Annuities are generally funded with after-tax dollars, but their earnings are tax deferred (you pay tax on the portion of distributions that represents earnings). There is generally no annual limit on contributions to an annuity. A typical annuity provides income payments beginning at some future time, usually retirement. The payments may last for your life, for the joint life of you and a beneficiary, or for a specified number of years (guarantees are subject to the claims-paying ability of the issuing insurance company). Annuities may be subject to certain charges and expenses, including mortality charges, surrender charges, administrative fees, and other charges.
Note: In addition to any income taxes owed, a 10 percent premature distribution penalty tax may apply to taxable distributions made from employer-sponsored retirement plans, IRAs, and annuities prior to age 59½ (prior to age 55 for employer-sponsored retirement plans in some circumstances).
Contact a VyStar Investment Services Financial Advisor today by phone (904) 908-2495 or email VISMarketing@vystarcu.org.
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