 Coolest cars for under $18,000. The car experts at Kelley Blue Book call the Hyundai Veloster the number one coolest car available for under $18,000. But Dodge and Chevrolet make a surprise appearance on the foreign-car-dominated list.
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The word "meat" just isn't working up the appetite like it used to. Taco Bell will start testing a new "Power Protein" menu in Ohio aimed at health-conscious consumers. The emphasis is on nutrition, rather than meatiness.
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 US consumer confidence at five-year high in June. The Conference Board announced that its consumer confidence index jumped to 81.4 in June. That's the best reading since January 2008. Twenty percent of consumers expect there will be more jobs in six months.
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If you're looking for a way to save some money each month on home expenses, you may be considering replacing the HVAC (heating, ventilating and air conditioning) system. This article provides some useful guidelines to help you determine when to replace your HVAC system and how to comfortably handle the cost of an HVAC system upgrade.
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George Zimmer, CEO of Men's Wearhouse, was not fired because of his personal image. He was let go because he wanted to sell the company to a private investment group. "Mr. Zimmer had difficulty accepting the fact that Men's Wearhouse is a public company with an independent board of directors and that he has not been the chief executive officer for two years," said the board.
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 Fewer than one in four Americans have enough money in their savings account to cover at least six months of expenses, enough to help cushion the blow of a job loss, medical emergency or some other unexpected event, according to the survey of 1,000 adults.
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 While Downton Abbey fans may be sad over the loss of one of their favorite (and sensible) characters, series creator Julian Fellowes is expressing a surprising amount of happiness. Dan Stevens, who plays Matthew Crawley, has moved on to roles in high-profile Hollywood films.
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 Some 70% of Americans either hate or are totally uninterested in their jobs, a Gallup study of 150,000 people finds. A full 20% of respondents are what Gallup classifies as "actively disengaged," the ones who are muttering complaints at the water cooler and using their lunch breaks to scour job postings online.
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This month we share a new video that discusses what investors' attitude should be toward record-low interest rates, dividend-paying stocks, and setting money aside during market turbulence. After you've watched it, please feel free to contact us at 614-888-2121, 877- 389-2122 (toll free) or chornyak@chornyak.com if you have any comments or questions.
We also have some important information on the implementation of the new healthcare law, concerns for estate planning, and some new insights into divorce in America, which we hope you will find interesting and enlightening.
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Weathering the storm during financial turbulence
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Joe Chornyak discusses the necessity of having a diversified investment portfolio that yields returns in the long run. At the same time, setting some cash aside for emergencies will help ride the storm of market fluctuation.
Click here or on the image above to view the video.
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Health insurance exchanges gear up for action
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Eleanor Laise of Kiplinger points out some important benefits of the new healthcare law that will soon be in effect.
Circle October 1 on your calendar. If you're under 65, you may be less than three short months from a whole new outlook on your health, wealth, and retirement security. October 1 marks the start of open enrollment on the new state-based health insurance exchanges created under the 2010 health care overhaul law. And it will give many older consumers their first opportunity to sign up for health insurance plans that guarantee comprehensive coverage regardless of health status, in many cases subsidized by tax credits. Coverage will begin January 1, 2014, when most people are required to have insurance or pay a penalty. People who have long been charged hefty premiums because of their age, denied coverage for preexisting conditions or rejected completely will suddenly find multiple insurers competing for their business. For people in their fifties and early sixties who are not yet eligible for Medicare, the health law provisions taking effect in the coming months "really are a game-changer," says Sara Collins, a vice-president at the Commonwealth Fund, a nonprofit research group in New York. "People won't have to make career decisions based on whether or not they have health insurance through a job," she says. That dream of entrepreneurship or early retirement could become a reality. The launch of the exchanges should reverse a troubling decline in insurance coverage among older adults not yet eligible for Medicare. In 2012, 20% of people 50 to 64 did not have insurance for the full year, up from 15% in 2005, according to the Commonwealth Fund. A previous survey found that cost concerns caused 75% of people in this group to skip needed health care, including avoiding doctor visits when they were sick. A decline in workplace coverage and rising long-term unemployment among the age 50-to-64 group have contributed to the coverage gaps. "Even someone with hefty savings and a lot of retirement income could find themselves in a lot of trouble in the individual market today," particularly if they have a chronic condition such as diabetes, says Karen Pollitz, senior fellow at the Kaiser Family Foundation. "Even if you do get a good rate when you're healthy, if something happens to you, kiss it goodbye." People with employer coverage should pay close attention to the exchanges, too. Workers and early retirees offered only skimpy employer plans can shop for their own coverage on the exchanges. The upcoming changes remove some big question marks from the retirement planning process, reducing the risk that you'll have to go uninsured and limiting the premiums you can be charged as you grow older. That should bring relief to people like Ray Swartz, 61, a retired public speaker in San Francisco. The premium on his individual health plan, now about $600 a month, has climbed roughly 10% year after year. Health care, he says, "is the number one expense I have, by far." He's planning to look for other coverage options when the exchanges open later this year. There are still big challenges ahead for consumers seeking affordable coverage. A 62-year-old who is eligible for tax credits on the exchange, for example, could still spend as much as 27% of his income on premiums and out-of-pocket costs if he incurs a very high level of health care charges, according to a Commonwealth Fund report. Consumers may also find that plans on the exchange don't include the broader provider networks they're used to seeing. The details of insurance offerings are not available yet, but you don't have to wait until October to start exploring your health care choices. Here are answers to some key questions that will help prepare you for the new health care marketplace. Will I be required to switch plans? If you're currently covered by a plan that you purchased on the individual market, you may not have to change plans, but you may want to shop on the exchange anyway. If your policy was active before March 23, 2010-the day that health care reform was signed into law-your plan may be "grandfathered," meaning you can simply keep your current coverage. But you may miss out on some of the benefits that the health law requires for newer plans, including the elimination of annual coverage limits and free coverage of preventive services. Grandfathered plans must, however, comply with some other aspects of the law, such as the elimination of lifetime coverage limits and protections against insurers canceling your coverage after you get sick. Read the entire article here.
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Avoiding inheritance conflict in your family
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 Commonwealth Financial Network provides this important article on the importance of planning ahead for the distribution of your assets to beneficiaries after you die. Open communications and good documentation are essential.
Even in the most close-knit families, an inheritance can cause a feud if the deceased hasn't left a detailed plan. You might be thinking, "That would never happen to my family!" Unfortunately, family feuds over inheritances are all too common.
To help ensure that your clan won't be left bickering about money after you pass away, here are some tips to consider:
- Be realistic and communicate openly. Your children may be depending on a significant inheritance to help them purchase a home, pay for a child's education, or cover another large expense. To avoid disappointment, give them a sense of where you stand financially, emphasizing that your finances may change depending on medical expenses or other unexpected costs.
- Keep your documents up to date. Be sure to update your will and beneficiary designations to reflect life events such as marriages, divorces, new grandchildren, and so on. Keeping your documents current will help ensure that you don't unintentionally include or exclude anyone.
- Address personal property. In addition to your will, leave a separate list of personal property with instructions detailing who should inherit each item. The list should describe each piece of property you wish to gift, leaving no room for interpretation.
- Don't task the oldest beneficiary with distributing your assets. Many parents inadvertently create conflict by naming the eldest child as the beneficiary of their assets, expecting him or her to evenly distribute the inheritance to the other siblings. If you want all of your children to inherit equally, put them all down as legal beneficiaries.
Continue reading this article by clicking here.
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(To view the video, click here or on the image above.)Suzi Wagner is a financial advisor at Chornyak & Associates who focuses on serving clients and growing the business. You can read each staff member's individual bio on the About Us section of our web site.
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Not your mother's divorce: Three 21st century trends
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Forbes contributor Jeff Landers writes for women who are going through a financially complex divorce. In this piece he reports on declining marriage rates, women initiating the divorce, and "grey" divorce.
Marriage rates are decreasing, so divorce rates are decreasing, as well.Groucho Marx famously said, "Marriage is the chief cause of divorce." He was spot on. Choosing not to get married doesn't mean you won't ever go through a painful breakup, but it does mean you won't have to get a divorce if it happens. Nowadays, many couples choose to live together in long-term relationships rather than get married -and they can do so without worrying about social repercussions. Think about how your grandparents would have felt about your mother living with her boyfriend before the wedding, let alone long-term! In many families, such a choice would have been scandalous even one generation ago. By contrast, many couples today live together before marriage, and increasingly, instead of marrying at all, without scandalizing anyone or even raising many eyebrows. Moreover, according to U.S. Census data, couples who do marry are doing it later. In 2000, the average age of a woman at first marriage was 25; in 2010, it was 26. The data shows that not only has the average age at which couples first marry crept up, but the percentage of adults over ages 35, and even 45, who have never married has also grown significantly over recent years. This might be attributed to the ever-increasing percentage of women in the workplace. Women have significant assets of their own, and don't need to marry to be supported financially, anymore. (For some of you reading this, it may be difficult to imagine that was ever true!) In addition, the availability of child care enables more women to keep working after they have children. "From an economic standpoint part of the reason why marriages are trending down is because historically and traditionally, women felt the need to be married to achieve financial stability; however, today's women are educated and independent, and marriage is a choice as opposed to a necessity," explained Emmanuel Kojo Bentil, Esq., from Bentil Associates, LLC, Media & Business Counsel & Consultants. "You can see this trend manifested in television programming, films and other media. As an entertainment attorney, a vast majority of the women I currently represent and work with or have previously represented are single women who are entrepreneurs and successful within their field. Whenever I think of an unmarried, financially independent and extremely successful woman, I think of Oprah Winfrey." Most of the time, it's the woman who initiates divorce.Many people are surprised to learn that about 2/3 of divorces are filed for by the wife. That number climbs even higher among women who have more economic independence and social acceptance of the choice. Based on my professional experience, my take on this trend is that even though a man may engage in activities that take a toll on the marriage, he's usually not inclined to end it himself. By contrast, I've seen many women put up with a range of destructive behavior - cheating, drug or alcohol addiction, gambling, emotional or physical abuse, narcissism, or any number of things - until they just can't take it any more, or until they see that their children are being irreparably affected by it. At that point, they initiate divorce proceedings. Continue reading the article here.
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This communication is strictly intended for individuals residing in the States of: AL, AR, AZ, CA, CO, CT, DC, DE, FL, GA, IA, IL, IN, KY, LA, MA, MD, ME, MI, MN, MS, MT, NC, NH, NJ, NV, NY, OH, OR, PA, RI, SC, SD, TN, TX, UT, VA, VT, 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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As the Federal Reserve considers its exit . . .
The key news events for June were the Federal Reserve (Fed) meeting and news conference, where Fed Chairman Ben Bernanke announced that he believed the real economy was improving. He also stated that members of the Fed Board of Governors had begun to consider the circumstances under which it would slow the pace of the central bank's bond purchasing program.
Markets interpreted this as an announcement that the Fed would be no longer be supporting the economy, and they reacted accordingly. Interest rates rose, and stock prices fell. Subsequent announcements that a reduction in stimulus would not occur in the near-term were reassuring to investors. Both interest rates and markets recovered, though rates remained higher and markets lower by month-end.
The downward adjustment and subsequent partial recovery may reflect a growing understanding that the real economy is normalizing and that interest rate policies must do so as well. At the same time, the gradual withdrawal of the Fed from fixed income markets may require further pricing adjustments as overall demand drops.
. . . Volatility returns to markets . . .
The volatility that started in May continued in June. Equity markets ended the month down across the board, with the Dow Jones Industrial Average losing 1.25 percent, the S&P 500 Index losing 1.34 percent, and the Nasdaq losing 1.52 percent. Volatility persisted throughout the month, with multiple moves of more than 1 percent, both up and down. Price movements were particularly high at the end of the month, with a more than 5-percent drop in five days followed by an almost 3-percent recovery.
Even as stock prices have fluctuated recently, investors should feel good about returns this year. This has been the strongest first half for U.S. equity markets since 1998, with the S&P 500 returning 13.82 percent. In the second quarter, it rose 2.91 percent.
Technically, U.S. markets are in a weaker position than they have been recently. Markets closed well below their 50-day moving averages, a sign of weakness, and have shown a downward trend over the past couple weeks. Although they are still above their 200-day averages, it will be important to see whether they recover or remain below their 50-day averages.
The major fundamental factor affecting markets in June was the spike in interest rates following the Fed's news conference. Income-generating stocks, and those most dependent on lower rates, were significantly affected. The financials sector, which had led markets higher throughout the first and most of the second quarter, lagged in June. In particular, REITs performed poorly, as rising interest rates took away what had been a major tailwind to this asset class's performance. Investors also shunned cyclical sectors such as materials and energy.
International markets showed similar weakness. The MSCI EAFE Index lost 3.55 percent for the month and 0.99 percent for the quarter, while the MSCI Emerging Markets Index showed even weaker performance, losing 6.79 percent for the month and 8.94 percent for the quarter. International markets were affected not only by the turmoil in U.S. markets, but also by a banking shock in China, where the central bank initially declined to intervene in a liquidity shortage before later relenting. In Europe, ongoing weakness in the real economy continued to weigh on financial market performance.
Bonds were unable to shield against weak stock market performance in June. The Barclays Capital Aggregate Index fell 1.55 percent and slipped 2.32 percent during the quarter. Bond prices were hit across the board, as U.S. rates spiked. Within the realm of fixed income, floating-rate bonds were one of the better-performing areas in June. Investors in short-duration bonds were also largely insulated from rising rates. The worst-hit area over the month was international bonds, which were subjected to the negative currency effect of a rising dollar, as well as generally rising rates. Long-duration bonds, particularly corporates, also underperformed.
Nevertheless, investors should keep the recent sell-off in bonds in perspective. As events in June demonstrated, it is possible to lose money in bonds, but the volatility of high-quality bonds is still significantly lower than that of stocks. Over the longer term, it is important to include bonds in most portfolios as an anchor to counterbalance the risks taken in equities.
The real economy continues to improve in the U.S.
Part of what drove the Fed's announcement, and the consequent volatility in financial markets, was the improvement in the real economy. During June, and throughout the second quarter, economic indicators showed improvement almost across the board.
The improvement continued despite the negative economic effects of federal government spending cuts known as sequestration. These cuts led in part to a reduced estimate for first-quarter growth, and they intensified during the second quarter, slowing growth in many areas. Despite this, economic growth continued.
Housing pushed the economy forward, with prices and sales levels still increasing. Supply remained at historically low levels, suggesting that home values could continue to rise. Meanwhile, housing construction supported employment growth.
Overall growth in employment slowed but stayed positive in June. Nonetheless, consumer confidence and spending increased. Leading economic indicators ticked up, supported by increases in economic surveys from several of the 12 Fed districts.
The negative effects of sequestration were set to peak around June and may now begin to subside, suggesting that the current moderate levels of growth may increase. The Fed's withdrawal of stimulus from the economy could prove a headwind, when it takes effect, but the Fed has made clear that this will not occur immediately.
The rest of the world does less well
Even as the U.S. real economy continued its moderate recovery, other parts of the world showed more weakness. Europe was still mired in a mix of slow growth and recession, depending on the country, with unemployment at very high levels throughout much of the southern eurozone and political uncertainty continuing to affect Greece.
China showed the greatest level of uncertainty, as an apparent liquidity squeeze in the banking system, driven by a shortage of cash, drove interbank interest levels to record highs. The Chinese central bank initially refused to intervene but later had to inject cash to support the system. This, combined with slowing growth in the Chinese economy, drove down Chinese equity prices, which was a large contributor to emerging market weakness.
U.S. remains well positioned for growth
Despite the negative factors impacting the U.S. economy-the drag from sequestration, slowing manufacturing growth driven by economic weakness in Europe and Asia, and rising interest rates-the current recovery appears to be on track. The effects of sequestration should peak and recede in the next couple months, the nonmanufacturing sector is continuing to show strong growth, and interest rates are moderating.
Risk factors remain, principally from abroad, as the eurozone remains very weak and China experiences growing pains. In addition, the actual course of the Fed's exit will almost certainly create more volatility. Nonetheless, at this point we expect the U.S. economic recovery to remain on track.
For financial markets, more volatility may come, but, although recent events have created weakness, there does not appear to be any obvious reason for significant further declines. External shocks are possible, but at this point it appears that markets may have stabilized. With this in mind, investors should focus less on short-term market gyrations and instead allocate capital in a manner consistent with their long-term goals.
Authored by Brad McMillan, vice president, chief investment officer, and Sean Fullerton, investment research analyst, at Commonwealth Financial Network.
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