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“After such a long period of relative calm … volatility has reared its head yet again, and, as is often the case, it started first in the currency market,” according to David Rosenbreg, chief economist and strategist at Gluskin Sheff. “Near-6% moves in the US Dollar against the likes of the sterling and euro in a two-month span are hardly regular occurrences …Gold has sunk to eight-month lows, off 6.5% in barely more than six months, while oil has swung back into contango (where the spot price trades below futures), which is aggravating downward price pressures.”
Bond yields and the US dollar historically move together, “but treasuries are selling off their radically overbought levels, equities are rolling over and some commodities have sagged to fresh five-year lows.”
There has also been “a very sudden switch in expectations” regarding when the Fed will raise rates. And on top of that, the Japanese economy is “stumbling” following a sales tak hike, and the most recent European Central Bank easing has “exerted little lasting impact.”
“Ordinarily, gold and commodities fare well in periods of global political tensions, but not this time, perhaps owing to the softness in domestic demand growth abroad. A better way to play the instability and stepped-up military expenditures may be through exposure to global defence stocks,” Rosenberg writes.
Women Live Longer Than Men But Tap Into Social Security Benefits Too Early (Financial Advisor Magazine)
On average women live longer than men, but only 3% of women wait as long as possible to receive Social Security benefits, according to a Nationwide Financial survey. And that’s bad for them because the earlier you begin getting benefits, the less you’ll get in aggregate.
Generally the earliest time possible to receive benefits at 62, which reduces the total benefits for life. On the flip side, each year a person waits after 66 (the retirement age), their benefits grow by 8%.
Women may buy into benefits early for several reasons. Some might be unaware that waiting will result in greater benefits (and may think that retiring earlier will mean more benefits). Others may simply be forced into retirement.
The life expectancy for a woman is 86, and 25% of women reach 92, according to Nationwide.
There Are Several Ways To Improve Communication With Your Clients (Financial Planning)
There are several easy ways to improve communication with clients, according to Financial Planning’s Ingrid Case.
One way is to keep the conversation relevant and involved. In other words, don’t just stick to reports and numbers. Instead, ask clients about major and minor life events, which could influence their financial plans in a way they did not previously realise.
Also, involve clients in agenda setting. Sometimes financial advisors give so much information at one time that clients have a hard time processing and analysing the situation. If you set the agenda together, they can more seriously think about what will be discussed.
And last, ask clients questions that will help them open up about money. These include things like “if you had all the money you need and needed only to do something every day that thrills you, what would it be?” or “it’s a random Wednesday morning during your retirement. What are you going to do today?”
“Only 20% of American today is part of a ‘traditional’ family like the one portrayed in the show ‘Leave it to Beaver,'” according to Investment News’ Liz Skinner. As a result, there’s a huge market potential for creating a business model that offers financial help to single-parent, multigenerational, same-sex households, boomerang families, blended families, and more.
75% of modern families (defined as those that are anything except a married couple with one or more children under 21 living at home) do not have a financial adviser. 57% have never used professional financial help.
However, these are the families that are more likely to need financial help. In fact, around 73% of families experienced financial hardship “such as bankruptcy, an unexpected loss of a main income source or the need to rely on short-or long-term disability.” Contrastingly, only 42% of traditional families reported these issues.
Investors who try too hard to be hands-on actually “do a poor job of timing their purchases and sales,” Morningstar’s Christine Benz writes. Even fund managers didn’t do well when they employed this strategy.
On the flip side, being completely hands-off isn’t a great strategy either. “You’ll improve your portfolio’s risk/reward profile (and especially its risk level) by periodically rebalancing your asset-class exposures back to your target levels — that is, scaling back your exposure to strong-performing assets and adding to your underperformers,” Benz writes.
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