The End of The 4 Percent Rule

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The "4 percent rule" was a retirement spending approach that became mainstream in the 1990s. The rule suggested that a retiree with an average portfolio distributed between stocks and bonds (approximately 60-40) should withdraw 4 percent of his or her retirement funds each year (adjusting each year for inflation). If the retiree could stay limited to that 4 percent, he or she would be able to fund retirement for at least 30 years. The simplicity of the 4 percent rule made it hugely popular with investors. The method made planning easy and was projected to leave the vast majority of ...

Protecting Yourself From Tax Scams

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Here at McCarthy Grittinger Financial Group we understand that tax season can be a stressful time of year. It’s annoying and, for many, expensive. But despite its unpopularity, some people are determined to make it even worse: tax scammers. Wherever there is money, there is someone willing to steal it. Tax season provides thieves with several opportunities to fleece people who are just trying to do their civic duty. There have been some recent news stories already this year about IRS-impersonators calling taxpayers and we feel it is important for our clients to understand the issues at hand. Fortunately, being …

Predictions and Investor Psychology

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“We really can’t forecast all that well, and yet we pretend that we can, but really can’t.” -Alan Greenspan “In order to be successful, an investor has to understand not just finance, accounting, and economics, but also psychology” – Howard Marks, Co-Chairman Oaktree Capital Predictions and Investor Psychology As we put together our 2016 outlook newsletter, a few themes continue to rise to the top and the question of which topic to write about became an easy answer: investor psychology and market predictions. When viewed together, you can see how easy it is for an investor to get caught up …

Tis The Season for List

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‘Tis the season to review lists that we made either at the beginning of the year or at the beginning of the holiday season (and maybe even check them twice if you are like Santa). Lists are a great tool for many things. They give us a goal. They keep us focused. They give us feedback. Financial planners like goals, focus, and feedback. Financial planners love lists! Perhaps a list’s biggest benefit is the reference point it provides when your plan is under “attack”. We all can relate to walking into the store (or clicking for those internet shoppers) and …

Congress Ends Two Advanced Social Security Strategies

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Social Security may be one of your largest assets. What and when you collect will make a huge difference to your lifetime benefits and changes to the program are important to understand. This month's newsletter provides an explanation of recent changes. In November 2015, Congress passed a law that raised the national debt limit and prevented a government shutdown. The law included provisions that removed two Social Security filing statuses: "file-and-suspend" and "file-and-restrict." Read All

Season of Change

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It has been told that Mark Twain was a terrible investor and the reason being that he ended up gaining knowledge through his own poor decisions and experiences. The above quote could be attributed to another hard lesson learned in that to speculate in the short-term is a fool’s errand. As you know, we do not believe it is profitable in the long-term to speculate on the short-term. With that said, we were not shocked or overtaken with emotion when the stock market recently became much more volatile the last few months. When we look at investment portfolios, we will …

Stay Calm and Carry On

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Benjamin Graham, called the father of fundamental investing, said “in the short run the market is a voting machine; in the long run, it is a weighing machine.” A dilemma investors seem to face today is that the ‘short run’ seems to be more like the ‘long run’. We are particularly aware of the emotions of this market and that investors can change their ‘vote’ about the future very often. But we hold firmly to Mr. Graham’s belief that the ‘long run’ makes more sense and that the fundamentals will eventually be ‘weighed’ by the market. Stay calm and carry …

Our Perspective On Recent Market Volatility

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In this stock market turmoil, we want to assure you that Your Anxiety Removal Team® is here for you. We are monitoring events and the markets and pledge to keep you informed. We have been through these volatile storms in the past and will survive again. As your financial advisor, we care deeply about your financial well-being, and it is in times like these that it is important to stay calm and refrain from making decisions that may be detrimental to your wealth. What is going on? Global financial markets endured their worst week of the year this past week …