Jimmy Buffett's 1977 hit "Margaritaville" is not the world's most popular song, but it is probably the world's most lucrative. There are now 27 Margaritavilles worldwide, the newest of which, in Atlantic City, is comprised of restaurants, a casino, bars, and stores. In 2007, Margaritaville Enterprises raked in $100 million in revenue,
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Whether by choice or through financial reality, the percentage of American households without a car has doubled over the past two decades and is now approaching one in 10.
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 An anonymous physician who earns $570,000 a year and says, "I know that technically I am in the 1%, but I don't feel rich at all." He owns a home worth nearly $1 million, three cars, a couple of investment properties, and a chunk of a profitable healthcare company yet still frets that he doesn't have enough. "I don't feel secure."
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 World's largest Lego unveiled in New York's Times Square: The Star Wars X-wing starfighter measures 11 feet tall, 43 feet long and has a 44-foot-long wingspan. Thirty-two builders spent 17,336 hours putting together 5,333,200 bricks to build the star ship.
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 Las Vegas: New thrill ride to zip guests between Rio towers. The ride will send guests racing along a wire between the hotel's Masquerade and Ipanema towers at speeds of up to 33 miles an hour. While it's similar to a zipline, the attraction is electrically powered, so it doesn't rely on gravity.
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 "Debit or credit?" You hear it almost every time you use plastic and you probably have a preferred answer. But did you know there are some circumstances when one might be better than another? Here are five situations when you might want to choose credit over debit.
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 Weary travelers looking to catch a nap inside an airport can rarely escape the noise and bustle of the terminal. But one airport has a unique, egg-shaped solution. Abu Dhabi International Airport unveiled cocoon-like sleeping chambers inside one of its terminals.
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 Will the JCPenney brand disappear within the next year? Each year, 24/7 Wall St. identifies 10 important brands sold in America that it predicts will disappear within a year's time. This year's list reflects the brutally competitive nature of certain industries.
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We hope you will take a look at our new video on investment thoughts, and give us your opinions on how this approach may affect your financial strategy.
We try to keep our newsletter content varied and useful. College graduation time is upon us again, so our lead article deals with the serious topic of student loan debt. Please feel free to contact me with your comments and suggestions: 614-888-2121, toll-free at 877-389-2121, or chornyak@chornyak.com.
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Financial success over the long run
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 As a result of Joe Chornyak's recent meetings with portfolio managers, he uncovered some surprising insights as to what is HOT in financial markets today. Don't miss this video in which he shares with us his thoughts on creating the greatest opportunity over the long haul. Click here or on the image above to view the video.
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Getting on the right financial track after graduation
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 College graduates carrying student loan debt have been of great concern recently. Commonwealth Financial Network provides the following useful recommendations for dealing with student loans.
Do you know anyone graduating this year? According to the Project on Student Debt, an initiative sponsored by the Institute for College Access & Success, graduating seniors carried an average of more than $26,000 in student loans in 2011. With that in mind, we've compiled some ideas designed to help new grads take charge of their finances.
Controlling student loan debt
- Know your loan repayment options. For federal loans, you may be able to reduce your payments by choosing a different type of repayment plan.
- With a graduated plan, your payments start low and then gradually increase, usually every two years.
- With an extended plan, you can stretch your payments over a period of up to 25 years, but you must have an outstanding loan balance greater than $30,000.
- With an income-based plan, your payments fluctuate each year based on annual income, household size, and loan balance.
- Look into consolidating your loans. By combining multiple student loans into one, possibly at a lower or fixed interest rate, consolidation programs may allow you to dramatically reduce your monthly payments. To learn more, visit www.studentaid.gov and click on Repay Your Loans > Loan Consolidation.
- Consider public service. If you enter a field dedicated to public service (including the Peace Corps and AmeriCorps), your outstanding loan balance may be eligible to be forgiven; for more details, go to www.studentaid.gov and click on Repay Your Loans > Forgiveness, Cancellation, and Discharge.
- Don't miss payments. Missing payments hurts your credit. Plus, the government can confiscate your tax refund and even some of your wages to collect the amount you owe.
Continue reading this article by clicking here. Graduating students face a number of challenges when it comes to managing their finances. Beyond these tips, Chornyak & Associates are happy to offer personalized advice to help you or someone you know start off on the right foot financially. Contact us at 614-888-2121, toll free at 877-389-2121, or chornyak@chornyak.com.
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(To view the video, click here or on the image above.)This month we are featuring one of our key associates in a personal video introducing you to a seasoned professional who serves you at Chornyak & Associates. You can read each staff member's individual bio on the About Us section of our web site.
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Retirees return to college just for the fun of it
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Kiplinger's Judy Hasson investigates how lifelong learning programs provide intellectual stimulation and social connections.
You never thought about going back to school-that is, until you retired. Now that you have time on your hands, you're searching for intellectual stimulation. Fortunately, a growing number of universities and colleges are offering academic courses that cater to the retiree seeking to learn something new.
Ballet and music
Stanley Darer, 67, worked in finance for 35 years, and he wanted to explore anything except studying money. He has been taking courses on ballet and music at the Encore Program for Lifelong Enrichment at North Carolina State University since he retired six years ago. "I was ready for a liberal arts education," he says.
He has also been going to as many concerts and recitals as he can find. "Like most retirees, I was looking for things to keep busy, and I found it in senior learning," says Darer, who moved to Raleigh, N.C., from New York to be near his grandchildren.
Lifelong learning
Retirees such as Darer are part of a phenomenon called lifelong learning, which began more than 30 years ago but is gaining new popularity as baby boomers retire. These programs provide ways for seniors to increase their knowledge and explore new interests in ways they never could when they were saddled with tough work schedules and family obligations. They also offer opportunities for retirees to make social connections with people of similar life experiences and interests.
"Continuing education for seniors is crucial for their mental and physical health," says retired mathematician Stanley Schmidt, 74, of Poughkeepsie, N.Y., who has been teaching science and math courses for 20 years at Marist College's Center for Lifetime Study, which is organized and run by seniors.
Technology and gardening
In choosing courses, you can be whimsical or serious, find new passions or just fill in a knowledge gap. There are heavyweight subjects, such as "Current Trends: Technology and Culture" at Washington University in St. Louis and "The Civil War" at Regis College in Weston, Mass. On the lighter side, you can learn about Cole Porter, George Gershwin and other American songwriter greats by taking "They Wrote the Songs" at George Mason University in Fairfax, Va. Or you can go practical by taking classes on smart-phone photography, Microsoft Word or personal-finance topics, such as a course at Kellogg Community College in Battle Creek, Mich., on making money from your garden.
Read the entire article here.
NOTE: Few people know that The Ohio State University offers all of its courses for FREE to persons over 60. Contact Program 60 by calling 614-292-8860.
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How to spend less than you earn
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Trent Hamm of The Simple Dollar went through a complete financial meltdown in 2006. In this article he shares his number one tip for fighting debt and bad spending habits while building a financially secure future.
It sounds so simple, doesn't it? Yet there are many people out there burying themselves in debt (spending
more than they earn) or living purely paycheck to paycheck (spending exactly what they earn).
Here are five big ways to get started spending less than you earn.
First, go through every monthly required bill.
Ask yourself if you really need that service at all. Do you really use Netflix enough, or could you just rent a movie once in a while from Redbox? Do you really use your cell phone much at all, or could you just replace it with a pay-as-you-go phone? Then, go through each bill and see if there are any optional services you can eliminate. Do you really need premium cable? Do you really need unlimited text messages?
Second, keep diligent track of your spending. Keep a notebook in your pocket and write down every expense you have.
The simple process of doing this will make you think twice about unnecessary expenses. When you do have a month's worth of expenses written down, take a careful look at them. Ask yourself whether or not each of these expenses actually contributed to the value and joy of your life. That process will offer a lot of insight for you as to where your spending is going to waste.
Third, look carefully at your routines.
Watch what you do every day (or most days). Are there things you do each day that cost money? Those things are the most powerful ones to adjust, as trimming just $1 from your daily spending saves you $365 a year. Do you stop at a coffee shop each day? Why not cut down your daily order a bit, or switch to a different shop, or start making your coffee at home? Do you eat out every day? Perhaps you can start brown bagging it a few days a week. Look at every regular expense you have.
The rest of the phrase, than you earn, though, points to the other part of the equation: increasing your earnings. Continue reading for tips on how to earn more. 
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This communication is strictly intended for individuals residing in the States of: AL, AR, AZ, CA, CO, CT, FL, GA, IA, IL, IN, KY, LA, MA, ME, MI, MT, NC, NY, OH, PA, SC, TX, VA WI, WV. No offers may be made or accepted from any resident outside these States due to various state requirements and registration requirements regarding investment products and services.
Securities and Advisory Services Offered Through Commonwealth Financial Network, Member FINRA/SIPC, a Registered Investment Adviser. Fixed-insurance products and services offered by Chornyak & Associates, LTD are separate and unrelated to Commonwealth.
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Disclosures: Certain sections of this commentary contain forward-looking statements that are based on our reasonable expectations, estimates, projections, and assumptions. Forward-looking statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. All indices are unmanaged and are not available for direct investment by the public. Past performance is not indicative of future results. The S&P 500 is based on the average performance of the 500 industrial stocks monitored by Standard & Poor's. The Nasdaq Composite Index measures the performance of all issues listed in the Nasdaq Stock Market, except for rights, warrants, units, and convertible debentures. The Dow Jones Industrial Average is computed by summing the prices of the stocks of 30 large companies and then dividing that total by an adjusted value, one which has been adjusted over the years to account for the effects of stock splits on the prices of the 30 companies. Dividends are reinvested to reflect the actual performance of the underlying securities. The MSCI EAFE Index is a float-adjusted market capitalization index designed to measure developed market equity performance, excluding the U.S. and Canada. The MSCI Emerging Markets Index is a market capitalization-weighted index composed of companies representative of the market structure of 26 emerging market countries in Europe, Latin America, and the Pacific Basin. The Russell 2000® Index measures the performance of the 2,000 smallest companies in the Russell 3000 Index. The Barclays Capital Aggregate Bond Index is an unmanaged market value-weighted performance benchmark for investment-grade fixed-rate debt issues, including government, corporate, asset-backed, and mortgage-backed securities with maturities of at least one year. The U.S. Treasury Index is based on the auctions of U.S. Treasury bills, or on the U.S. Treasury's daily yield curve. The Barclays Capital Mortgage-Backed Securities (MBS) Index is an unmanaged market value-weighted index of 15- and 30-year fixed-rate securities backed by mortgage pools of the Government National Mortgage Association (GNMA), Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (FHLMC), and balloon mortgages with fixed-rate coupons. The Barclays Capital Municipal Bond Index includes investment-grade, tax-exempt, and fixed-rate bonds with long-term maturities (greater than 2 years) selected from issues larger than $50 million. The Barclays Capital U.S. Treasury Inflation Protected Securities (TIPS) Index measures the performance of intermediate (1- to 10-year) U.S. TIPS.
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Strong May marred by volatility at the end
May was another strong month for the equity markets, with a total gain of 2.34 percent for the S&P 500 Index, 2.24 percent for the Dow Jones Industrial Average, and 3.82 percent for the Nasdaq. Both the S&P 500 and the Dow notched new all-time highs, but the positive results masked a great deal of intra-month volatility. The first weeks of the month showed almost uninterrupted increases, while the last week was quite volatile, with multiple daily gains and losses of more than 1 percent, in addition to a noteworthy sell-off on the final day of May.
Fundamentals were unchanged for the month, with no new earnings announcements. Valuations crept higher with the market itself, extending further above historical levels on a long-term basis and starting to rise above those levels on a short-term basis. Technicals remained relatively strong despite the month-end turbulence, with all indices well above their 50- and 200-day moving averages.
Equity market volatility was driven largely by comments from Federal Reserve (Fed) Chairman Ben Bernanke, who seemed to suggest in a May 22 appearance before Congress that the Fed might start to reduce its asset bond purchases much sooner than had been anticipated. This unexpected information led investors to reconsider future growth expectations.
Chairman Bernanke's comments also caused volatility in the fixed income markets. The Barclays Capital Aggregate Bond Index lost 1.78 percent for the month, and 10-year U.S. Treasury yields rose from 1.66 percent to 2.16 percent (as referenced in Figure 1). The floating-rate bank loan sector was the only fixed income sector to post positive returns, and long-duration Treasuries and TIPS were hardest hit. International bonds, particularly emerging market debt, also underperformed.
Figure 1: 10-Year U.S. Treasury Yields, January 2013-May 2013
International stock markets significantly underperformed U.S. markets for the month, on both a relative and an absolute basis. Representing developed markets, the MSCI EAFE Index was down 2.41 percent. The MSCI Emerging Markets Index was down even more, losing 2.94 percent. Volatility came largely from Asia. Japan experienced very wide swings, with large gains in the first half of the month erased and turned into losses in the second half. Of the major emerging market stock markets, Brazilian equities in particular struggled, losing 7.11 percent of their value.
The real economy continued to grow
While Wall Street experienced volatility, Main Street appeared to continue its steady recovery. Early in May, employment gains for April came in above expectations, and there were substantial upward revisions for previous months. These positive signals were confirmed during the month, as initial unemployment claims persisted at low levels, close to the lowest numbers since January 2008.
Housing showed strength as well. Both new and existing home sales increased, by 2.3 percent and 0.6 percent, respectively, to the highest levels since mid-2008. In addition, house prices climbed more than 10 percent year-over-year, per the S&P/Case-Shiller 20-City Home Price Index. The supply of houses for sale remained well below normal levels, which is around 6 months, coming in at 4.1 months for new homes and 5.2 months for existing homes. The below-normal supply and persistent strong demand suggest that the home price trend may continue.
Rising house values and stock prices combined to bring overall household wealth levels close to pre-crisis peaks. These factors, together with declining gasoline prices, acted to push consumer confidence up. Both the University of Michigan Consumer Sentiment and Conference Board Consumer Confidence indices came in at or close to five-year highs in May.
At the end of the month, economic growth for the first quarter was revised slightly lower than had been initially estimated, from 2.5 percent to 2.4 percent. Even this downward revision had a positive take, however, as it was mostly due to a larger-than-estimated decline in government spending. Net of that, the private economy actually grew slightly faster than the initial estimate, per Capital Economics.
With so many indicators for the real economy at multiyear highs, and despite the ongoing effects of sequestration, many forecasters expect economic growth to continue at reasonable levels for the rest of 2013.
Growing economy puts Fed on the spot
With the real economy growing and stock markets performing relatively well, the Fed is in a quandary. At some point, it will have to start winding down its stimulus program, which currently buys $85 billion in bonds per month. The question is: When?
When Chairman Bernanke testified on May 22, he said it was quite possible that the Fed would start to slow (and end) its program in the second half of this year, sooner than many had thought. His actual testimony went further than his written preliminary testimony, and this came as a surprise to the financial markets. The prospect of a quicker-than-expected wind-down led to market turmoil, with a drop of more than 2 percent on May 22 and a further decline the next day.
The volatility caused by the chairman's comments highlights one of the major risks for investors in this market-the uncertainty surrounding the continuation of Fed support. Although it does not appear that the Fed intends to exit immediately, at some point it will do so. That exit may result in higher interest rates, which could cause market turbulence and possibly act as a headwind to the ongoing recovery.
Real economy solid, markets less so
At month-end, the real economy appeared well positioned for continued growth at current levels, but financial markets appeared less stable. Much depends on when and how the Fed starts to reduce its stimulus program. Interest rates will be the primary channel. If rates start to tick up significantly, both stock and bond valuations could be at risk.
Right now, however, interest rate increases don't appear likely in the short term, though they are eventually inevitable. Investors should be aware of this and plan for the volatility that may come when the Fed makes its move. At that time, the recovery in the real economy may be more firmly in place, which should, we hope, provide a firm foundation if markets wobble.
For investors, cautious optimism remains the appropriate stance. Improvements in the real economy certainly inspire confidence, yet the end-of-month market instability serves as a reminder for investors to be positioned with long-term goals in mind rather than with the objectives of following short-term trends.
Authored by Brad McMillan, vice president, chief investment officer, and Sean Fullerton, investment research associate, at Commonwealth Financial Network.
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