Maintaining a long-term focus Posted on May 26, 2020June 3, 2020 by ksimas The stock market’s history of volatility and growth As we all struggle with the unprecedented coronavirus crisis and the corresponding stock market crash, it may provide some small degree of comfort to view the current market turmoil from a historical perspective. When investing for the long term, it’s important to keep in mind that while stocks have far outperformed other investments over the long term, they have also been subject to short-term periods of sharp decline. Financial Market Performance Growth of $10,000 investments From January 1, 1970 – December 31, 2019 Source: Morningstar Office. Stocks measured by Standard & Poor’s 500 Index, bonds by the Ibbotson Associates SBBI US Long-Term Government Bond Index, and money market by the SBBI US 30-Day Treasury Bill Index. All results assume reinvestment of dividends on stocks or coupons on bonds and assume no taxes. It is not possible to invest directly in an index. The hypothetical investment results are for illustrative purposes only and should not be deemed a representation of past or future results. Actual investment results may be more or less than those shown. The graph above illustrates the growth of hypothetical $10,000 investments in stocks, bonds and money market securities over the last 50 years. Notice that during this 50-year period, stocks have provided vastly superior long-term performance than bond or money market investments, but at the same time have subject to a far higher level of short-term volatility. This volatility is illustrated by the more dramatic peaks and valleys of the blue line depicting stock market performance. Note that at the end of the fifty-year period, the $10,000 stock investment has grown to nearly three times the amount of the bond investment, and more than five times the amount of the money market investment. Included in this 50-year time period were the “2nd Black Monday” stock market crash of 1987, the “dot-com bust” crash of 1999–2000, and the “Great Recession” crash of 2008. Following these and other significant stock market declines, the market rebounded to eventually reach new record highs. While past stock market performance is not a guarantee of future results, the historical performance of the market suggests it will eventually recover from its current decline just as it did with previous ones. It is possible to lose money by investing in a money market fund. Although the fund seeks to preserve the value at $1.00 per share, it cannot guarantee it will do so. The fund may impose a fee upon the sale of shares or may temporarily suspend sales of shares if its liquidity falls below required minimums because of market conditions or other factors. An investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The fund’s sponsor has no legal obligation to provide financial support to the fund, and you should not expect that the sponsor will provide such support at any time.
3 Tools to Help Build Your Retirement Savings Posted on May 14, 2020 by ksimas All teachers have that one class that makes them feel like retirement can’t come soon enough. If that’s you this year, then it’s time to kick your savings into high gear. However, saving like you are in a mad dash toward retirement takes the dedication of a marathoner. Here are three tools to help you build your retirement savings. 1. Calculate how much you need to save The question of how much you need to save for retirement can be as big a buzzkill as seeing a back-to-school ad on your first day of summer vacation. The many variables used to determine your retirement savings needs can make calculating this magical number complex. But, once you’ve done some mental math and have a goal number in mind, our Investment Goal Calculator can help you figure out what you need to save today to get there. With it you can explore the many factors involved, including your initial savings, periodic contribution amounts and frequency, years to accumulate, interest compounding, inflation and more. By experimenting with these numbers using the calculator, you’ll see what you can do today to reach your retirement investment goal. 2. Pre-tax savings Also referred to as “tax-deferred” savings, in that it’s income you won’t pay taxes on now, but will when withdrawing from your retirement savings, pre-tax savings is automatically taken from your paycheck and deposited in your retirement savings plan. It can make saving for retirement easy and help you avoid the feeling that you’ve got to give something up to save. Because the money is automatically deposited into your savings instead of your bank, it doesn’t necessarily feel like you’re making a sacrifice. For those who have trouble saving, this may help establish positive savings habits. 3. A savings app Digital spending has become increasingly easy and convenient with applications like Venmo, Amazon Prime, and other retailers who make paying for goods and services a simple click of a button. Saving for retirement with the help of apps can be equally as simple. Try these apps to help you save using digital technology. Created by Intuit, Mint helps you create budgets, categorize spending to eliminate superfluous expenses, pay bills, vet credit card programs, and review your overall financial picture to find ways to save money and reduce fees. As a smartphone app, Mint can send you notifications and reminders to help keep you on track. Qapital and Acorns are both savings apps built on the idea of investing leftover funds into a savings account. Qapital invests unspent budget surplus into your savings account and allows you to set reminders to save when ad-hoc or contractor payments are received. Acorns use what they call ‘micro-investing.’ For each purchase you make, Acorns will round up to the nearest dollar and automatically invest the spare change. Budgeting apps like Mvelops and Claritymoney help you monitor your spending and both suggest ways to save, plus alert you if you go over budget. Clarity Money goes so far as to use AI to monitor your spending habits. Mvelopes uses Certified Budgeting coaches to help you stay on budget and increase your savings.
What are Mutual Funds? – MemberMinds Video Posted on May 12, 2020June 29, 2020 by ksimas A mutual fund is a portfolio of securities such as stocks or bonds. Investors can own shares of a mutual fund and over time can earn capital gains or experience capital losses. In this video, MemberMinds host Tom Nugent talks with Chris Janeway, a PlanMember Financial Professional. They discuss: The basics of mutual funds and their advantages and disadvantages How mutual funds are managed and who chooses the securities included in the portfolios The differences between managed and indexed mutual funds Costs related to owning mutual funds and the various expenses and fees Knowing when a mutual fund may be the right investment vehicle for your overall investment plan
529 College Savings Plans – MemberMinds Video Posted on May 12, 2020June 16, 2020 by ksimas <span data-mce-type="bookmark" style="display: inline-block; width: 0px; overflow: hidden; line-height: 0;" class="mce_SELRES_start"></span> A 529 plan allows individuals to save money for college on a tax-advantaged basis and can be a great vehicle to help pay for eligible college expenses. Many parents and students are trying to figure out how best to save for the high cost of college. MemberMinds host Tom Nugent and Chuck Riharb, Business Development Officer at PlanMember discuss 529 plans. Together they review: What 529 plans are and the tax advantages they provide Who can use the proceeds of a 529 and what qualified expenses include Who can start a 529 plan and other features of 529 plans To get further insight about 529 plans and other college savings vehicles, contact your PlanMember Financial Professional.
Beneficiaries – MemberMinds Video Posted on May 12, 2020June 29, 2020 by ksimas Proper designation and regular review of your retirement account beneficiaries are essential to ensuring that what remains in your accounts after you pass on goes exactly where you want. All too often, improper designation or failure to update account beneficiaries leads to unnecessary delays, taxes, legal battles or the money simply not going where it was intended. Angel Sugleris, Assistant Vice President of Human Resources at PlanMember, and host Tom Nugent discuss the importance of beneficiary designation. Additionally, they cover: State regulation for spousal beneficiary designation Naming a trust or a will as a beneficiary The importance of reviewing your beneficiary designations
Working with Financial Advisors – MemberMinds Video Posted on May 12, 2020June 16, 2020 by ksimas Working with a financial advisor can help you tackle important financial decisions about retirement planning, but the decision of who to choose can be difficult. This episode of MemberMinds on the advantages of having a financial advisor and some tips on how best to select one. Topics include: What to look for when researching potential financial advisors What qualifications and credentials financial advisors can have and what they mean What a relationship with a financial Advisor means and what to expect To get more information about selecting a financial advisor, contact your PlanMember Financial Professional.
Roth IRA – MemberMinds Video Posted on May 12, 2020June 29, 2020 by ksimas <span data-mce-type="bookmark" style="display: inline-block; width: 0px; overflow: hidden; line-height: 0;" class="mce_SELRES_start"></span> Roth IRAs are after-tax individual retirement plans created to help individuals save for retirement. Because it allows individuals to save after-tax dollars and provides tax-free income in retirement, a Roth IRA may have advantages for many investors. In this episode, MemberMinds host Tom Nugent talks with Greg Marsh, Registered Representative at PlanMember Securities, about the differences between a Traditional IRA and a Roth IRA and when you should consider one over the other. Additionally they discuss: The tax advantages of a Roth IRA How household income can affect your ability to contribute to a Roth IRA Conversion from Traditional IRAs into Roth IRAs
403(b) Plans – MemberMinds Video Posted on May 12, 2020June 16, 2020 by ksimas <span data-mce-type="bookmark" style="display: inline-block; width: 0px; overflow: hidden; line-height: 0;" class="mce_SELRES_start"></span> A 403(b) savings plan is an employer sponsored retirement plan for employees of school districts, governmental organizations and other 501(c)(3) nonprofit employers. While its counterpoint for employees of private employers, the 401(k) plan, is similar, there are some distinct differences are worthy of discussion. In this video, MemberMinds host Tom Nugent talks with Richard Ford, Chief Marketing Officer at PlanMember. They discuss: What exactly a 403(b) is and who can contribute to one Tax-advantages of a 403(b) and concurrent 457 contributions 403(b) Roth options and other additional 403(b) features To get further insight about 403(b)’s and to find out if one might be right for you, please contact your PlanMember Financial Professional.
Retirement Plan Loans – MemberMinds Video Posted on May 12, 2020June 16, 2020 by ksimas <span data-mce-type="bookmark" style="display: inline-block; width: 0px; overflow: hidden; line-height: 0;" class="mce_SELRES_start"></span> No one wants to have to dip into retirement plan savings to meet current financial needs, yet retirement plan loans are an option many Americans consider using under pressing financial circumstances. As an alternative to taking heavily penalized early distributions from a retirement plan, a plan loan may be an option better suited to ensure you preserve what you’ve worked so hard to save. In this video, Tom Nugent and Chris Greenan explain more about what a retirement plan loan is, what types of plans they are available, and some of the regulations and restrictions for taking them. Considering a retirement plan loan? There are several things to carefully consider before you make your decision. What exactly is a Retirement Plan Loan, and when they are available How much can be borrowed in a retirement plan loan How retirement plan loans are repaid • How interest works for plan loans What happens if an individual is unable to repay a plan loan To learn more about plan loans, contact your PlanMember Financial Professional.
Annuities – MemberMinds Video Posted on May 12, 2020June 16, 2020 by ksimas <span data-mce-type="bookmark" style="display: inline-block; width: 0px; overflow: hidden; line-height: 0;" class="mce_SELRES_start"></span> Many people face the challenge of transitioning from saving for retirement, to spending during retirement. Leveraging an annuity is one way to help ensure that adequate income is available during retirement. MemberMinds host Tom Nugent discusses principles of an annuity and strategies for using them with Steve Hanson, Vice President of Strategic and Product Development at PlanMember. Additionally, they discuss: The different types of annuities How annuities can be used to cover essential retirement expenses Optional features annuities can have, and their provisions To get more information about the different types of annuities and their features, contact your PlanMember Financial Professional.