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Dear ,
Welcome to the August 2011 issue of The Wealth Chronicle.
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Market Update
Not only did August bring Hurricane Irene and a heat wave to the Northeast, we also saw the return of 2008 market volatility. It was common in August to see 500 point swings up and (mostly) down in the Dow a daily occurrence. Let's recap the events that caused the volatility
- The S&P downgrade of US Government Fixed Income. The irony is that after the S&P downgrade investors flocked to the very investments (US Treasuries) that were downgraded.
- The charade our politicians went through to come to a last minute deal to raise the debt ceiling which is the amount that our government is legally allowed to borrow
- Europe - Greece is bankrupt and fear spread that the same could happen to some of the larger European countries like Italy, Spain, and France. There was also rioting in England
- The US economy is growing slower than expected and our future growth numbers were revised downward.
- On the positive side, corporate profits remain very strong
- Joblessness numbers are improving even if it is slightly
There are a couple of things to consider in light of the recent events
- Unlike 2008 where every asset class took a hit, in August we saw a pullback to only equities. A well diversified portfolio is important to hedge against these types of pullbacks
- There is a lot of negative news floating around now regarding the economy. That news is already priced into the market which is why it does not make sense to panic sell if the market does pull back.
- The August pullback has the advantage that some asset classes are now on sale and can be purchased for a cheaper price and it may be time to consider a Roth IRA Conversion (See article below)
- Inflations seems to be tamed for now
Stayig tuned into the daily news of the market and economy can be trying. You can stock up on Alka Seltzer, Tums, or if you would like to discuss the economy or the specifics of your account I welcome the opportunity to talk with you. | |
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Free Social Security Planning Seminar
"What Baby Boomers Need to Know to Maximize Retirement Income"
After being told for years that Social Security is "going broke", baby boomers are realizing that it will soon be their turn to collect. To help baby boomers better understand the Social Security system, this workshop will cover the following:
- 5 factors to consider when deciding when to apply for benefits
- When it makes sense to delay benefits - and when it does not
- Why you should always check your earnings record for accuracy
- How to coordinate benefits with your spouse
- How to estimate your benefits
- How to minimize taxes on Social Security benefits
- How to coordinate Social Security with your other sources of retirement income
The decisions baby boomers make now can have a tremendous impact on the total amount of benefits they stand to receive over their lifetime
Date: Tuesday September 20, 2011
Time: 7:00PM Location: Ringwood Public Library, 30 Cannici Drive Ringwood, NJ 07456 Register Now
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Roth IRA Conversion One of the byproducts of the August pullback in the equity markets is the executing of a Roth IRA conversion making sense. When a Roth IRA is converted you have to pay taxes on the amount that is converted. For example if you convert an IRA worth $100,000 and are in a 25% tax bracket, you would have to pay $25,000 ($100,000 X .25). However if your IRA is now worth $90,000, you would have to pay $22,500 in taxes ($90,000 X .25). A Roth IRA has many unique benefits that you can't find with other financial tools. I have written a couple of articles in previous newsletters that detail the Roth IRA: April 2009 and February 2010. There are other factors that go into determining if it makes sense to convert to a Roth IRA and if you would like to discuss it with me, please contact me at 201-842-7655 or marc@bautisfinancial.com.
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Lobsters and Microbrews
When an August road trip to Maine for Alison and Steve's wedding got put on the calendar we weren't sure what to expect. Katie and I had never been to Maine and were not looking forward to the 7 hour car drive up there. Prior to the trip I was told that Maine was beautiful and the food was great. Maine did not disappoint.
We knew we were in for a good trip when 2 miles over the border we stopped for lunch and had our first lobster roll, which seemed like a hot dog roll stuffed with two lobsters worth of meat. Little did we know that lobsters were so common in Maine that you could get them at a gas station the same way you go into a 7-11 around here and could get a slurpee. The other thing we found out that Maine is known for is Microbreweries. On the recommendation of our friend Kevin, the beer connoisseur, we stopped at Shipyard Brewery in Portland
Our second stop on the trip was at The Samoset Resort in Rockport. We spent a couple of days there relaxing in an atmosphere that reminded of us the resort in the movie Dirty Dancing. Luckily we were there the same time the 64th Annual Lobster fest was going on in town. http://www.mainelobsterfestival.com/
After Samoset we drove back down the coast to the wedding location in Booth Bay Harbor. There we ate more lobster, had an afternoon of exploring the harbor via bicycles and a great time at the wedding.
Maine was a great time and if you don't mind the long drive up there I definitely recommend visiting. |
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Provident Bank
Tired of earning 0% interest on your bank accounts? Provident Bank of NJ offers a Smart Checking program in which you can earn 2.51% APY for balances up to $25,000. There are certain requirements that must be met, but in addition to the 2.51% APY, you receive Free Online Banking, ATM Refunds, and there are no monthly fees or minimum balance requirements
You can find out additional information from the Provident website or by contacting Hal Rodriguez, the manager of the Provident Bank branch in Hoboken.
Hal Rodriguez
201-659-4311
halbert.rodriguez@providentnj.com
77 River St, Hoboken, NJ 07030 | 
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Nearly half of affluent Americans will not or did not pay for the full cost of their children's college education. Their reasons why?
- 45% expect their children to receive a scholarship or grant
- 30% want to make their children more appreciative of their education
- 29% want to teach their children about financial responsibility
- 19% their children want to pay part of the expense
- 18% will not have enough money
On July 31st the Atlanta Braves became the second baseball franchise to record 10,000 losses. The first was the Philadelphia Phillies. I knew the Mets played in the weakest division!
Of the approximately 2.8 million death reports the Social Security Administration receives per year, about 14,000 are incorrectly entered into its Death Master File, which contains the Social Security numbers, names, birth dates, death dates, and last-known residences of more than 87 million deceased Americans. Erroneous death entries can lead to benefit termination, cause severe financial hardship and distress to affected individuals. People have stopped receiving disability checks, had bank accounts closed, and even lost inheritances.
If you "diss" Jersey Shore's "The Situation," prepare to pay the penalty! A day after offering "The Situation" of the Jersey Shore reality TV show a substantial payment if they stopped wearing Abercrombie-branded clothes, Abercrombie's stock dropped 8% on a day when the market was flat. It seems the two acts were a coincidence and that Abercrombie's stock drop could be tied to its earnings announcement in which it gave a lukewarm outlook to its sales and earnings.
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Please contact me if you have any questions about the articles above or about your personal or business finances.
Sincerely,
Marc Bautis
Wealth Manager office: 201-842-7655
cell: 201-221-6895 fax: 201-754-9760
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Disclaimer:The information contained in this newsletter is for information purposes only and may not be suitable for your specific financial situation. You should consult a financial advisor before making any investment decisions relating to the information contained in this newsletter
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 | MEET MARC
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Marc Bautis is a Wealth Manager specializing in working with young families as well as retirees and those nearing retirement. He understands that everyone wants to not only protect their principal, but also be sure that their money lasts. He is committed and proud to deliver independent advice, always in the interest of his clients.
Marc is the creator of the Retirement Fitness Challenge™, a program designed to be sure his clients enjoy the retirement years as they have always envisioned them. Marc's program is designed to prevent outliving your money but also to minimize expenses during retirement and find the best time to start taking Social Security benefits.
Marc is a graduate of Seton Hall University. He is a Bergen County native, from Lyndhurst, where much of his extended family still resides. He currently lives in Hasbrouck Heights with his wife Katie and Old English Bulldog, Winnie.
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