Vantage Point UPDATE: Intermediate-Term and Long-Term Trend Analysis

On Friday, June 19, the S&P 500 closed @ 2110, and that was...
  
   +3.7% ABOVE its 12-Month moving average which stood @ 2034.
   +2.6% ABOVE its 40-Week moving average which stood @ 2056.
   +0.1% ABOVE its 10-Week moving average which stood @ 2108.


Therefore, the INTERMEDIATE-Term trend is NEUTRAL
and the LONG-Term trend is UP.

Annuities: Understanding the Difference Between Fixed And Variable Annuities

Do you know how much the fees and expenses associated with your retirement investments are?

Annuities offer tax sheltered growth which can result in significant long-term returns for you if you contribute to the annuity for a long period and wait to withdraw funds until retirement. You get peace of mind from a guaranteed income stream, and the tax benefits of deferred annuities can amount to substantial savings.

There are Two Categories of Annuities – Fixed and Variable

A Fixed Rate Annuity is sold by an Insurance Company and offers you a very low-risk retirement account. The owner is guaranteed at least a minimum rate of investment return. The insurer declares a specific credited rate of return based on the investment performance of its general account assets. You can receive a fixed amount of money every month for the rest of your life. However, the price for removing risk is missing out on growth opportunity. Should the financial markets enjoy bull market conditions during your retirement, you forgo additional gains on your annuity funds.

A Variable Annuity is sold by a stockbroker and is classified as a Security Investment by the SEC. A variable annuity is subject to stock market risk. With a variable annuity, contract owners are able to choose from a wide range of investment options called subaccounts, each of which generally invests in shares of a single underlying mutual fund. As with mutual funds, the investment return of variable annuities fluctuates. The most common objection to variable annuities is how notoriously expensive they can be.

A Variable Annuity with $100,000 in account value would pay $3,750 per year in fees before any interest is credited.

Fixed Annuities Offer Less Investment Risk. Generally, fixed annuities involve less investment risk than variable annuities because they offer a guaranteed minimum rate of interest. The minimum rate is not affected by fluctuations in market interest rates or the company’s yearly profits. Most people like the security of knowing that their annuity payments will never vary or that they will receive at least a minimum amount of credited interest.

Here are a few Guidelines to Consider When Making a Change to Your Retirement Portfolio:

Buy From Someone Reputable. Whether you are working through an adviser or directly through a distributor, get the facts on the firm’s financial strength and business practices. What is the company’s rating with third-party ratings agencies? Is it known for fair claims-paying practices? How reliable is its customer service? Dealing with a company that is fair and financially sound may help save you from financial headaches in the long run.

Educate yourself. Knowledge is Power. Make sure to ask your financial adviser about any potential costs that might not be apparent. The point here is to completely understand what you are paying for and how to utilize the benefits when you need them.

Be sure to consider annuities as part of your overall investment strategy, as they can add value and security to your retirement.

Watch the video below for more information on the fees and expenses associated with Variable Annuities...

Case Study: Managing Taxation on Retirement Income Withdrawals

Case Study: Managing Taxation on Retirement Income Withdrawals

As a way to help minimize the income taxes one pays, consider the following hypothetical scenario.

It illustrates the way a retired married couple whose annual expenses total $100,000 might seek to manage their taxes.

Our hypothetical couple expects $42,000 in gross income (all taxable) before tapping their retirement accounts, so their gross income gap—(before considering taxes)—is $58,000. They anticipate $20,000 in deductions and exemptions, so their expected taxable income before withdrawals is $22,000. If they withdraw $52,900 from their traditional IRAs, it would bring their taxable income to $74,900—the top of the 15% bracket for 2015.

They could then withdraw the remaining $5,100 that they need to cover their income gap from a Roth IRA, which does not generate taxable income (assuming the withdrawal is qualified). The chart below shows their cash flow and taxable income:

Example: How to Manage Taxes on Withdrawals for Retirement Accounts

This hypothetical example is for illustrative purposes only. This hypothetical scenario assumed the couple does not receive Social Security benefits. Social Security income would further complicate the tax scenario described above and should be considered when creating a withdrawal strategy.

Other Options for Our Hypothetical Couple

The hypothetical couple in this scenario leaves the bulk of Roth IRA assets alone, leaving them in place to potentially generate tax-free growth. In certain situations, however, it may be advantageous to tap Roth assets instead of tax-deferred or taxable accounts. These include situations when:

• Any distributions at all from a tax-deferred account would cause your taxable income to exceed your target marginal tax rate
• Withdrawing from a taxable account would require selling assets held less than a year, resulting in short-term capital gains, which are taxed at ordinary income tax rates
• You are also trying to minimize taxes on Social Security benefits, and withdrawals from a tax-deferred account would have an impact on the taxability of those benefits

Your circumstances may be considerably different from those described in the scenario. Nevertheless, you may be able to apply the principles to your own situation. A tax professional can help you explore the implications of different withdrawal strategies, help minimize the amount of taxes you pay on hard-earned savings, and, of course, help you maximize your ability to live the retirement you envision.

Vantage Point UPDATE: Intermediate-Term and Long-Term Trend Analysis

On Friday, June 12, the S&P 500 closed @ 2094, and that was...
  
   +3.1% ABOVE its 12-Month moving average which stood @ 2031.
   +2.0% ABOVE its 40-Week moving average which stood @ 2053.
   -0.6% BELOW its 10-Week moving average which stood @ 2107.


Therefore, the INTERMEDIATE-Term trend is NEUTRAL
and the LONG-Term trend is UP.

A Tale of Two Economies...

Bull Market Reaches 6 Years and 3 Months...

The ongoing bull market for the S&P 500 reached 75 months in length, or  6 years and 3 months, as of the close of trading on June 09, 2015. 

This bull run, the index’s 11th since 1950, is the 3rd bull in the last 65 years to reach 75 months in length.

Vantage Point UPDATE: Intermediate-Term and Long-Term Trend Analysis

On Friday, June 5, the S&P 500 closed @ 2094, and that was...
  
   +3.1% ABOVE its 12-Month moving average which stood @ 2030.
   +2.1% ABOVE its 40-Week moving average which stood @ 2051.
   -0.5% BELOW its 10-Week moving average which stood @ 2104.


Therefore, the INTERMEDIATE-Term trend is NEUTRAL
and the LONG-Term trend is UP.

Why LA's $15 Minimum Wage Will Really Be $19.28

Read More At Investor's Business Daily: 

Why LA's $15 Minimum Wage Will Really Be $19.28 


Follow us: @IBDinvestors on Twitter | InvestorsBusinessDaily on Facebook

GDP Declines -0.7% in 1Q 2015

Read More @ Investor's Business Daily: 

As Obama's Economy Falls, White House Excuses Boom 


Follow us: @IBDinvestors on Twitter | InvestorsBusinessDaily on Facebook

Vantage Point UPDATE: Intermediate-Term and Long-Term Trend Analysis

On Friday, May 29, the S&P 500 closed @ 2107, and that was...
  
   +4.3% ABOVE its 12-Month moving average which stood @ 2020.
   +2.8% ABOVE its 40-Week moving average which stood @ 2049.
   +0.3% ABOVE its 10-Week moving average which stood @ 2101.


Therefore, the INTERMEDIATE-Term trend is NEUTRAL
and the LONG-Term trend is UP.

Investors are Still More in Love with Bonds than Stocks

Impact of 401(k) Fees

Vantage Point UPDATE: Intermediate-Term and Long-Term Trend Analysis

On Friday, May 22, the S&P 500 closed @ 2126, and that was...
  
   +5.1% ABOVE its 12-Month moving average which stood @ 2022.
   +3.9% ABOVE its 40-Week moving average which stood @ 2046.
   +1.2% ABOVE its 10-Week moving average which stood @ 2101.


Therefore, the INTERMEDIATE-Term trend is NEUTRAL
and the LONG-Term trend is UP.

The Future of Social Security...

GDP Forecast: UGH!

The People Who Nailed The Horrific Q1 GDP Number Have Bad News About Q2 

The Atlanta Fed nailed US gross domestic product in the first quarter.

On Wednesday, we learned that the US economy grew by just 0.2%, far below the consensus forecast among economists for 1% growth. Of the 86 economists surveyed by Bloomberg, only four estimated that GDP growth would be 0.2% or lower.

The Atlanta Fed had long forecast 0.2% growth before revising it down to 0.1% after last Friday's durable goods report.

And just a day after the disappointing Q1 GDP release, the Atlanta Fed has news about Q2: the economy will grow by just 0.9%, according to their latest forecast. Here's what they wrote in a post on their website:

"The initial GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2015 was 0.9 percent on April 30. 

Real GDP grew 0.2 percent in the first quarter, according to the "advance" estimate from the U.S. Bureau of Economic Analysis, 0.1 percentage point higher than the GDPNow model nowcast."

Economists noted that the winter weather, West Coast port strikes, and lower energy prices slowed down the economy — all temporary factors.

Still, for a sense of how gloomy the Atlanta Fed's forecast is, Bank of America Merrill Lynch is forecasting 3.5% growth. Goldman Sachs is forecasting 3.0% growth.

Vantage Point UPDATE: Intermediate-Term and Long-Term Trend Analysis

On Friday, May 15, the S&P 500 closed @ 2123, and that was...
  
   +5.0% ABOVE its 12-Month moving average which stood @ 2022.
   +4.0% ABOVE its 40-Week moving average which stood @ 2042.
   +1.4% ABOVE its 10-Week moving average which stood @ 2094.


Therefore, the INTERMEDIATE-Term trend is NEUTRAL
and the LONG-Term trend is UP.

Americans Losing Confidence in The Economy

Americans Losing Confidence in The Economy

It's bad news when Americans lose confidence in the economy.

When confidence deteriorates, consumers become worried about their jobs and their paychecks, which in turn makes them want to spend less. And considering that personal consumption accounts for 68% of gross domestic product, the consequences can be huge.

During the week ending Sunday, Gallup's US Economic Confidence Index fell to -9, the lowest level since December.

"The recent dip in Americans' economic confidence — which is being dragged down largely by the lower economic outlook component — is likely the culmination of a variety of economic factors," Gallup's Justin McCarthy writes.

The prices Americans were paying for gas increased in the latter half of April, with the US Energy Information Administration reporting an increase of 17 cents per gallon over two weeks. Gallup has found that Americans' confidence in the economy is related to how much they pay at the pump.

"Additionally, the recent report that the nation's GDP grew a lackluster 0.2% in the first quarter — a disappointing figure compared with previous quarterly growth — may have dampened consumers' economic hopes."

But like most economists, Gallup is optimistic this downturn is a temporary blip.

"Unless the economic news continues to be bad, Americans may soon forget about the weak first-quarter GDP and rising gas prices, which, the EIA projects, will stabilize during the summer," McCarthy added.

"And even in the midst of last week's negative economic news, there were bright spots, including the federal government's reporting increases in consumer spending and a 15-year low in jobless claims. But last week, the bad news appeared to carry more weight in Americans' evaluations than the good news."

Gallup's survey included 3,542 responses from adults in all 50 US states and the District of Columbia.

Wage Growth Metric is Precisely Where It Was the Last Time the Fed Started Hiking Rates...

This Wage Growth Metric is Exactly Where It Was the Last Time the Fed Started Hiking Rates  Wage growth is here. On Thursday, we got the latest Employment Cost Index (or ECI), which climbed +0.7% in the first quarter, beating the estimate for a +0.6% gain. The index climbed +2.2% quarter-over-quarter, and +2.6% over the previous year. That led one economist to suggest that the economy is "beyond full employment."  And Steven Englander, Citi's global head of fixed income strategy, highlights something else that's remarkable about the ECI. "ECI wages and salaries (dark blue) are now exactly where they were when fed funds began to rise in 2004," Englander said. He highlighted this with a chart. Englander notes that while wages were falling then, they are rising now.  The sluggish pace of wage growth is one of the biggest things that has kept the Fed on hold. On Thursday, the ECI, as well as the lower-than-expected initial jobless claims print for last week, signalled more tightness in the labor market. To be clear, Citi's economists are not calling for the Federal Reserve to begin hiking rates in June. Englander only points to it as an "interesting" observation. However, Cleveland Fed president Loretta Mester, said a rate hike next month is still "on the table," according to Reuters.

Vantage Point UPDATE: Intermediate-Term and Long-Term Trend Analysis

On Friday, May 8, the S&P 500 closed @ 2116, and that was...
  
   +4.7% ABOVE its 12-Month moving average which stood @ 2021.
   +3.9% ABOVE its 40-Week moving average which stood @ 2037.
   +1.3% ABOVE its 10-Week moving average which stood @ 2089.


Therefore, the INTERMEDIATE-Term trend is NEUTRAL
and the LONG-Term trend is UP.

Does Hillary Clinton Have A Credibility Problem?

Seasonal Stock Market Rationale for "SELL in May and Go Away" (until November)...

The 6-month period from November-April has gained +548.3% for the S&P 500 since 1990, 8 ½ times the +65.1% return achieved during the 6 months from May-October.

Both numbers are aggregate total return performance results calculated for their respective 6-month periods beginning on 05/01/90 and continuing through 04/30/15. 

Source: BTN Research


 

Vantage Point UPDATE: Intermediate-Term and Long-Term Trend Analysis

On Friday, May 1, the S&P 500 closed @ 2108, and that was...
  
   +4.3% ABOVE its 12-Month moving average which stood @ 2021.
   +3.6% ABOVE its 40-Week moving average which stood @ 2036.
   +1.0% ABOVE its 10-Week moving average which stood @ 2088.


Therefore, the INTERMEDIATE-Term trend is NEUTRAL
and the LONG-Term trend is UP.

Estate Planning: Pros & Cons of Joint Ownership of Estates