Q4, 2019 and the last decade

Q4 provided a strong finish to the year with US stocks up 9.1%, international stock up 7.86% and emerging markets up 11.84%. Bonds were relatively flat in Q4 with US bonds up 0.18% and global bonds down 1.11%. 2019 was a great year all around for investors. The US stock market was up 31.02%, international markets were up 22.49% and emerging markets were up 18.42%. The US bond market was up 8.72% and global bond markets were up 7.57%. Don’t you wish every year was like this? The US stock market had its best year since 2013 and US bonds had their best year since 2002! For a detailed market overview covering Q4 and all of 2019, click here. To provide a valuable perspective for investing, last year I compared 2017 to 2018, showing the difference a year can make. Now let’s look at the difference a decade can make. Average annualized return:                                        2000-2009       2010-2019       CombinedUS Stocks (S&P 500)                                                    -0.95%              13.55%                6.05%International Stocks (MSCI EAFE)                               1.17%               5.5%                    3.31%Emerging Markets (MSCI Emerging Markets)           9.77%              3.68%                  6.68%US Bonds (Barclays US Ag. Bond)                               6.33%              3.74%                  5.03%International Bonds (Barclays Global Ag. Bond)        6.49%              2.48%                 4.46% This is a great reminder to align your investments with your objectives since even over fairly long periods of time (which I would consider 10 years to be) results can vary drastically. And of course, it is important to maintain broad diversification to help smooth out the ups and downs. Advisory services offered through Arbor Point Advisors. Securities offered through Securities America Inc., Member FINRA/SIPC. Arbor Point and Securities America are separate companies. CA Insurance #0E88557

investing at market highs

 The stock market continues to set new highs. The bull market has been running for almost 11 years, the longest in history, and setting all-time highs since 2013. This has been great for investors, yet at the same time, it can cause concern that a drop is right around the corner. Of course, the market will drop at some point, ups and downs are a part of investing, however, don’t let the fear of market highs drive your investment decisions. Market highs get a lot of headline news, but they are a pretty common occurrence and should inspire confidence rather than fear. Below is some information to back up my reasoning: Post-World War II:- The S&P 500 has spent about half the time within 10% of all-time highs. In other words, it’s frequently close to “the top”- The S&P 500 has had positive returns 74% of the time the year following all-time highs, and even more frequently for the following 3- and 5-year periods- Number of market highs in recent years:2013 – 452014 – 532015 – 102016 – 182017 – 622018 – 182019 – 20+  If you interpreted market highs as a sign to hunker down and seek safety, you’ve likely suffered huge opportunity costs. Since the S&P 500 reached a market high in March 2013 following the Great Recession (a 5-year dry spell without market highs), it has hit over 200 new all-time highs and has more than doubled in value. As it is said, “time in” the market, not “timing” the market, is a more reliable strategy. I’m not saying that my crystal ball is telling me we will continue to set market highs each of the next few years, but I am saying that market highs are not reason alone to fear the stock market.Yes, there can be long periods of time without new highs, which is why it is important to make sure you have the right portfolio for your circumstances, one that is well diversified and in-line with your needs and comfort level.  Advisory services offered through Arbor Point Advisors. Securities offered through Securities America Inc., Member FINRA/SIPC. Arbor Point and Securities America are separate companies. CA Insurance #0E88557

Christmas Spending Holiday Budget Joy Giving  Gift

spending season

The change of seasons is something I look forward to each year, though admittedly it’s subtle in San Diego. Still, the cooler temperatures and early nights make me want to eat comfort foods and enjoy a dark beer. That said, there can be too much of a good thing and that is why I’m trying (and losing the battle) to stave off Christmas movies in my family until after Thanksgiving. All of the excitement, especially in children, can make it hard to say no. Retailers try to capitalize on the weakness and temptation to say yes during the holidays, and it seems to be working as holiday sales surpassed $1 trillion dollars last year. If we aren’t careful, the magic that comes with the holidays can actually suck the joy from us shortly thereafter. According to LendEdu, nearly a quarter of Americans will go into debt at Christmas and a survey by Principal Financial Group revealed that 53 percent of people feel financially stressed by holiday spending. Here are a few tips to keep the joy and avoid stress: Start saving for Christmas in January – Set a budget for Christmas, save for it throughout the year and stick to it when the time arrives. It feels much better to spend money you’ve already given yourself permission to spend.Avoid the Costco curse – This isn’t an official thing, but I’ve fallen victim to it myself. It’s the idea that I had no idea I needed something, or that it even existed, until I go to Costco and now I have to have it, and it’s a good deal! You could also call this impulse buying and it can happen anywhere.Take advantage of sales, but don’t be taken advantage of by them – I can’t even keep track of all the “special” sale days there are now, Black Friday, Cyber Monday, etc. With a little research, this can be a good time to make purchases as long as they’re planned for, and maybe not only for Christmas gifts. For example, my wife is overdue for a new phone. Since I was planning to buy her one within the next few months and we have the money earmarked, why not get a $200-$300 gift card for Target or Walmart by buying it at this time? That money can go towards our Christmas budget. I hope the tips above help you truly experience the joy of gift-giving, without lingering negative effects. Of course, the most important thing to remember is that the magic of the season comes from sharing moments with those you love and celebrating the birth of the Prince of Peace.   Advisory services offered through Arbor Point Advisors. Securities offered through Securities America Inc., Member FINRA/SIPC. Arbor Point and Securities America are separate companies. CA Insurance #0E88557

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Retirement Planner in San Diego

 

Advisory services offered through Arbor Point Advisors. Securities offered through Securities America, Inc., Member FINRA/SIPC. Arbor Point Advisors and Securities America are separate companies. This site is published for residents of the United States and is for informational purposes only and does not constitute an offer to sell or solicitation of an offer to buy any security or product that may be referenced herein. Persons mentioned on this website may only offer services and transact business and/or respond to inquiries in states or jurisdictions in which they have been properly registered or are exempt from registration. Not all products and services referenced on this site are available in every state, jurisdiction or from every person listed. CA Insurance #0E88557

Advisory services offered through Arbor Point Advisors. Securities offered through Securities America, Inc., Member FINRA/SIPC. Arbor Point Advisors and Securities America are separate companies. This site is published for residents of the United States and is for informational purposes only and does not constitute an offer to sell or solicitation of an offer to buy any security or product that may be referenced herein. Persons mentioned on this website may only offer services and transact business and/or respond to inquiries in states or jurisdictions in which they have been properly registered or are exempt from registration. Not all products and services referenced on this site are available in every state, jurisdiction or from every person listed. CA Insurance #0E88557​

Rancho Bernardo Financial Planner