For the fifth quarter in a row (Q4 2016 through Q4 2017), US stocks, international developed stocks, emerging markets stocks, and global real estate investments have been up. For the third quarter in a row (Q2 2017 through Q4 2017), both stocks and bonds have been up. Additionally, for the first three quarters of 2017 we saw both international developed and emerging market stocks outperform US stocks. In Q4 2017, emerging market stocks continued to outperform US stocks.SEE MORE
We often (maybe too often) beat the drums about staying the course and thinking long-term. We recommend this article; in which, Barry Ritholtz eloquently justifies several of ClearLogic’s Investment Principles regarding long-term thinking.
Here are a few of our favorite quotes from the article:
- “investors spend too much time worrying about risks that are either statistically unlikely or,
conversely, the kind of risk that ends up being good for their portfolios over the long haul.”
- “over the past century, U.S. stocks have returned about 10 times what Treasurys have,
although they also experienced numerous massive selloffs over that time”
- “Politics and investing don’t mix…How does knowing the political party of a president impact
a portfolio if a portfolio will outlast the administration? People who make decisions out
of fear or politics miss out.”
There will be market corrections, some significant. (This why at ClearLogic we prepare for them in our clients’ portfolios and financial plans and work with our clients so that they are prepared for them not just financially, but also mentally and emotionally.)SEE MORE
Global stock markets again rose during the third quarter of 2017. This marks three straight quarters of positive stock market growth and two straight quarters of positive growth across both stocks and bonds. International stocks outperformed US stocks in Q3, as we saw last quarter.
Of ClearLogic’s 10 Investment Principles for long-term conservative growth, most at play this quarter were “let markets work for you”, “embrace market timing”, and “don’t try to outguess the market”.SEE MORE
We at ClearLogic often tell our client “don’t try to save a buck; focus on how you want to live your remaining year”. Now there’s scientific research that shows spending a buck here and there to save time improves happiness.
A study in the Proceedings of the National Academy of Sciences suggest that spending money to save time may reduce stress about the limited time in the day, thereby improving happiness. Over 5,000 people in the United States, Denmark, Canada and the Netherlands were surveyed in 2 rounds on well-being and timesaving purchases, such as ordering takeout food, taking a cab, hiring household help or paying someone to run an errand. 28 percent in the first round and 50% in the second who made such purchases reported greater life satisfaction than those who did not. Despite its benefits, the practice of buying time is not as popular as one might expect, they found. Even among more than 800 Dutch millionaires surveyed, all of whom surely could afford to do so, only a slight majority spent money on timesaving tasks.
While a Protestant work ethic that values being busy or guilt over paying someone for a task that people could easily do themselves, the data now shows a buck here and there to save time especially on dreadful tasks provides significant happiness. We recommend reading more about the study in the fun article in the New York Times.SEE MORE
Significant tax savings are possible from deductions for assisted living facilities, nursing homes, and continuing care retirement communities. Taxpayers can deduct medical and dental expenses for the taxpayer, the taxpayer’s spouse, or relatives the taxpayer supports that are more than 10 percent of their adjusted gross income – including long-term-care expenses for chronically ill people even in a nursing home.
The determination of “chronically ill” must be made by a licensed health care practitioner who must certify the resident as unable to perform at least two activities of daily living for at least 90 days due to a loss of functional capacity. Severely cognitively impaired individuals requiring substantial supervision, such as those with Alzheimer’s disease, also qualify as chronically ill. If the taxpayer does not qualify as chronically ill by reason of being able to perform two or more of the activities of daily living, a portion of the cost of the stay at the assisted living facility is still deductible.
It is important to discuss and plan for long-term-care costs as well as available tax benefits and insurance options as part of one’s annual financial review. Having the right documentation in advance to take advantage of all tax benefits is equally important. We recommend reading more details about the tax benefits in an excellent article on the subject. (ClearLogic guides clients with the financial/tax, logistical, and even emotional aspects of long-term care and medical costs as part of handling “all things financial” for clients.)SEE MORE
Global stock markets again rose during the second quarter of 2017. Additionally, both US and international bond markets were up, making the second quarter of 2017 positive across the board. Last quarter, we noted that international stock markets outperformed US stock markets, reversing a trend we had seen over the past few years. The reversal continued this quarter with international stocks returning about double what the US stock market returned.
Of ClearLogic’s 10 Investment Principles for long-term conservative growth, most at play this quarter were “look beyond the headings”, “practice smart diversification”, and “let markets work for you”.SEE MORE
Federal retirees with healthy retirement incomes are in a unique position when it comes to health insurance.
On the surface, Medicare Part B appears attractive, because you most likely will not incur any co-pays or co-insurance costs with your Federal Employee Health Benefit [FEHB] plan. Unlike Medicare Part A which is free, Medicare Part B premiums are significant – for an individual with an adjusted gross income just over $85,000 per year are $2,250 per year and for a married couple just over $170,000 are $4,500. Keep in mind the FEHB plan covers 100% of medical expenses once the annual out-of-pocket maximum is reached – typically $5,000 for an individual and $10,000 for a couple.
In most cases even with periodic, major medical expenses, carrying Medicare Part B in addition to an FEHB plan will cost more than it will save you in out-of-pocket costs. There are a few cases where the cost of carrying Medicare Part B more than pays for itself. It all depends on your individual circumstances.SEE MORE
Global stock markets rose sharply in the first quarter of 2017. Over the past few years, US stock markets have outperformed international stock markets, but this quarter reversed that trend. Emerging market stocks in Q1 saw returns that were double that of the US markets, while international developed stocks outperformed US stocks as well. Only international bonds suffered negative returns in the first quarter.
Of ClearLogic’s 10 Investment Principles for long-term conservative growth, most at play this quarter were “avoid market timing”, “resist chasing past performance”, and “practice smart diversification”.SEE MORE
Filing a 278 financial disclosure form is an annual time-consuming and onerous task for most federal employees and military personnel often in positions of significant responsibility or highly compensated ones.
One must gather all the information to be filed, complete the form and its four schedules, and often revise it upon review by agency attorneys and/or ethics officials. At ClearLogic Financial, we manage all of our client’s financial assets under one umbrella reporting system and can run a single report to list almost all the items required on the 278. ClearLogic also uses a sophisticated investment approach to eliminate hundreds of potential conflicts of interest, thereby streamlining the listing of assets.
As part of our service to handle “all things financial” for our clients, ClearLogic prepares 278 forms for each of our federal and military clients. We consider it part of our professional role to make all financial matters easy for our clients.SEE MORE
While many are feeling that 2016 will go down in history as a very disappointing year, it certainly wasn’t for financial markets and your portfolio. In a year with Brexit and Donald Trump winning elections (and the Cubs winning the World Series!), the chart above should not have happened.SEE MORE