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Can Money Buy Happiness?

By Soutas Financial | June 21, 2021 | Comments Off on Can Money Buy Happiness?
Can Money Buy Happiness?

In 2010, a study was published by two Nobel prize-winning economists purporting that people with more money feel better about their lives. However, that held true only up to an annual salary of $75,000 ($90,000 in today’s dollars). Past the $75k threshold, people weren’t necessarily any happier.

That scenario has apparently changed in the ensuing decade. A recently updated version of the study now concludes that happiness continues to increase with income – without a cap.1

How do you define happy? The way we quantify happiness during our working years may be different from retirement. That’s largely because some of us define ourselves by our work or career status – how much we earn and whether we’ve reached our professional goals. Once we retire, the focus is put less on these things – our happiness can be shifted towards other things.

It may be family, travel, improving our golf or tennis game, pursuing hobbies, or checking off that bucket list. When we are in the retirement planning stage, it’s important to think about what will make you happy in retirement. From there, you can establish a number – your total assets – that support those concrete goals. That’s different from coming up with a random number and then living whatever lifestyle you can with it. If you’d like to discuss your retirement goals in more depth, feel free to contact us.

The 2020 World Happiness Report promises to be an interesting read because it’s the first in which data was collected during a global pandemic. While you would think the responses would be dreary, there are some positive patterns to consider. Across 12 countries, people affected by lockdowns developed stronger relationships with friends, neighbors and even the front-line workers at their local stores. In fact, 62% reported that living under a lockdown made them feel more connected to their community. More than half (58%) determined that those human connections are what make them truly happy.2

If you speak with retirees from earlier generations, there has long been a common theme that the important factor affecting a happy retirement is health – not wealth. More than 80% of today’s retirees agree. According to a recent Merrill Lynch study, regardless of wealth, Americans age 50 and older say that their biggest worry in preparing for retirement is being able pay for health-care expenses.3

Everyone’s ideal retirement is different. Your actual plans are what can change the goalposts for “the number” you need to have saved by retirement. While traditional retirement advice recommends we save anywhere from 10 to 15% of current income for retirement, you may be able to save less – or need to save more – to achieve the specific lifestyle you want in retirement. In other words, budget for the lifestyle you plan to enjoy, not the income that you presently earn.4

It’s one thing to scale your annual retirement income to your lifestyle – but what about the big-ticket risks? The Society of Actuaries (SOA) has identified a number of post-retirement risks that can affect income, such as the need for long-term or nursing care.5 By unbundling the income and insurance elements of your plan, you may be better able to afford the retirement lifestyle that will make you happy.6

Fresno Financial Consultant Takeaways 

Fresno financial planning is our utmost concern here at Soutas Financial and we thought these takeaways were worth mentioning again: The way we quantify happiness during our working years may be different from retirement. Once we retire, the focus is put less on these things – our happiness can be shifted towards other things. The 2020 World Happiness Report promises to be an interesting read because it’s the first in which data was collected during a global pandemic. Across 12 countries, people affected by lockdowns developed stronger relationships with friends, neighbors and even the front-line workers at their local stores. In other words, budget for the lifestyle you plan to enjoy, not the income that you presently earn.4

Diversifying your retirement assets among a variety of vehicles and alternatives—both insurance and investment oriented, depending on what is appropriate for your situation—may offer you a better chance of meeting your retirement income goals throughout your lifespan. We help our clients with problems sometimes associated with retirement such as stopping spend down and avoiding probate. In doing so we leverage strategic wealth management as well as retirement annuity designed to help accomplish those goals.

Are you trying to find an investment advisor? Look no further than Soutas Financial & Insurance Solutions Inc. your Fresno retirement plan consultant is committed to helping take the complexity out of retirement planning. By using a variety of insurance and investment strategies that focus on Asset Protection, Long-Term Care Strategies, Legacy Planning, Tax-Efficient Strategies IRA, 401(k) & 403(b) Rollovers, Life Insurance, Annuities, Medicare, we can help you develop an overall retirement income strategy specific to you and your family. We have a strong team of professionals helping ensure you receive all the assistance you need not only in developing your retirement income strategy, but in maintaining it throughout your retirement. Contact us today at 559-230-1648 or visit us today at Soutas Financial to get your retirement plans on track for success!

Other Fresno Financial Advisor Articles 

Soutas Financial & Insurance Solutions Inc. 
333 W. Shaw Avenue Suite 106
Fresno, CA 93704 
(559) 230-1648 
Soutas.com 

Content prepared by Kara Stefan Communications.

Alex Ledsom. Forbes. Feb. 7, 2021. “New Study Shows That More Money Buys More Happiness, Even For The Rich.” https://www.forbes.com/sites/alexledsom/2021/02/07/new-study-shows-that-more-money-buys-more-happiness/?sh=561c2ff770d5. Accessed March 1, 2021.

World Happiness Report. Feb. 24, 2021. “Let’s Build Back Happier!” https://worldhappiness.report/blog/lets-build-back-happier/. Accessed March 1, 2021.

Kathleen Coxwell. New Retirement. Jan. 9, 2020. “65 Retirement Tips for a Healthy, Wealthy and Happy Retirement!” https://www.newretirement.com/retirement/retirement-tips-healthy-wealthy-happy-retirement/. Accessed March 1, 2021.

Paula Pant. The Balance. Feb. 11, 2021. “Plan for Retirement Based on Lifestyle, Not Current Income.” https://www.thebalance.com/plan-for-retirement-based-on-lifestyle-not-current-income-453919. Accessed March 1, 2021.

Ken Hawkins. Investopedia. Jan. 4, 2021. “Common Post-Retirement Risks You Should Know.” https://www.investopedia.com/articles/retirement/08/post-retirement-risks-outlive-assets.asp. Accessed March 1, 2021.

Jerry Golden. Kiplinger. Nov. 4, 2020. “Find the Income to Insure Against Retirement Risks.” https://www.kiplinger.com/retirement/601671/find-the-income-to-insure-against-retirement-risks. Accessed March 1, 2021.

We are an independent firm helping individuals create retirement strategies using a variety of insurance and investment products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic financial planning strategies and should not be construed as financial or investment advice. All investments are subject to risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

-939480 – 06/21

How Can I Tell the Difference Between Economics and Finance?

By Soutas Financial | June 18, 2021 | Comments Off on How Can I Tell the Difference Between Economics and Finance?
How Can I Tell the Difference Between Economics and Finance?

One of the more glaring lessons of the 2020 pandemic was that the economy and the stock market are not the same thing, nor do they necessarily move in lockstep. They are measurements of two different things, often indicating how the other will react. However, as we saw last year, the economy is a greater indicator of how Main Street is doing while the stock market is more a reflection of Wall Street.

The day-to-day performance of major stock indices, such as the S&P 500 and the Dow Jones Industrial Average, is not usually an accurate account of what’s happening in the lives of most Americans.1

As a general rule, economics is more of a social science. It conveys a picture that captures the interplay between real resources and human behavior. Finance, on the other hand, is a proactive measure. Its focus is on the tools and techniques of managing money.

We hear these two terms used interchangeably all the time, though, and that’s because they often do move in the same direction. That’s not what happened last year. While millions of Americans lost jobs and other sources of earned income, after an initial drop in the stock market, many investors saw their portfolios make ample gains. This was a good demonstration of how your money in the market could be working as another source of income. It’s another way of diversifying your assets, so that your investments can keeping earning money even if you can’t. Remember, we’re here to help you put your assets to work, so call on us if you need guidance.

Economics covers the production, consumption and distribution of goods and services and how people interact with them — through buying, selling, or working to buy or sell them — and how they react to price changes driven by supply, demand and inflation. It is, after all, people who drive economic activity and ultimately growth. There are two main branches of economics: macroeconomics and microeconomics.2

Macroeconomics measures the overall economy through factors such as inflation, price levels, rate of economic growth, national income, gross domestic product (GDP) and changes in employment levels.Microeconomics tracks specific factors within the economy, largely the choices made by people, households and industries. It is a study of the incentives behind those decisions and how they affect the use and distribution of resources.4

Finance, on the other hand, deals specifically with the use and distribution of money. As a discipline, it comprises three basic categories: public finance, corporate finance and personal finance. Within those realms, we often talk about the difference between Main Street and Wall Street. Main Street describes the average American investor as well as small independent businesses, while Wall Street consists of high net worth investors, large global corporations and the high finance capital markets.

There are inevitable conflicts between these two sectors. For example, government regulations frequently are designed to protect individual investors and/or small businesses, but they can pose a detriment to Wall Street profitability. The opposite can also be true, where benefits for large corporations can hurt small businesses, local jobs and small investors.5

Early on, the Federal Reserve and other central banks stepped up to infuse the economy with capital, thus stemming the tide of the economic decline. While these moves helped bolster the stock market, they did not prevent the loss of hundreds of thousands of jobs or stimulate consumerism. In other words, policy and even legislative intervention may have helped Wall Street, but it didn’t do that much to encourage economic growth or job creation.6

Fresno Retirement Consultant Takeaways 

Soutas Financial your Fresno financial planner would like to remind you of these points: One of the more glaring lessons of the 2020 pandemic was that the economy and the stock market are not the same thing, nor do they necessarily move in lockstep. As a general rule, economics is more of a social science. It conveys a picture that captures the interplay between real resources and human behavior. Finance, on the other hand, is a proactive measure. Its focus is on the tools and techniques of managing money. Economics covers the production, consumption and distribution of goods and services and how people interact with them and how they react to price changes driven by supply, demand and inflation. Finance, on the other hand, deals specifically with the use and distribution of money.

Diversifying your retirement assets among a variety of vehicles and alternatives—both insurance and investment oriented, depending on what is appropriate for your situation—may offer you a better chance of meeting your retirement income goals throughout your lifespan. We help our clients with problems sometimes associated with retirement such as stopping spend down and avoiding probate. In doing so we leverage strategic wealth management as well as retirement annuity designed to help accomplish those goals.

When searching for Fresno financial advisors, look no further than Soutas Financial & Insurance Solutions Inc. your Fresno retirement planning advisor is committed to helping take the complexity out of retirement planning. By using a variety of insurance and investment strategies that focus on Asset Protection, Long-Term Care Strategies, Legacy Planning, Tax Efficient Strategies IRA, 401(k) & 403(b) Rollovers Life Insurance Annuities Medicare, we can help you develop an overall retirement income strategy specific to you and your family. We have a strong team of professionals helping ensure you receive all the assistance you need not only in developing your retirement income strategy, but in maintaining it throughout your retirement. Contact us today at 559-230-1648 or visit us today at Soutas Financial your top financial advisors in Fresno, Ca., to get your retirement plans on track for success!

Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Soutas Financial & Insurance Solutions, Inc. are not affiliated companies. California Insurance License # OK48173

Other Fresno Financial Advisor Articles 

Soutas Financial & Insurance Solutions Inc. 
333 W. Shaw Avenue Suite 106
Fresno, CA 93704 
(559) 230-1648 
Soutas.com 

Content prepared by Kara Stefan Communications.

1 Clark Merrefield. Journalist Resource. Jan. 11, 2021. “The stock market is not the economy. Right? Here’s what the research says.” https://journalistsresource.org/studies/economics/stock-market-not-economy/. Accessed Feb. 4, 2021.

2 Stephen D. Simpson. Investopedia. Nov. 2, 2020. “Finance vs. Economics: What’s the Difference?” https://www.investopedia.com/articles/economics/11/difference-between-finance-and-economics.asp. Accessed Feb. 4, 2021.

3 Investopedia. Dec. 29, 2020. “Macroeconomics.” https://www.investopedia.com/terms/m/macroeconomics.asp. Accessed Feb. 4, 2021.

4 Investopedia. Nov. 2, 2020. “Microeconomics.” https://www.investopedia.com/terms/m/microeconomics.asp. Accessed Feb. 4, 2021.

5 Corporate Finance Institute. 2021. “What is Main Street vs Wall Street?” https://corporatefinanceinstitute.com/resources/knowledge/finance/main-street-vs-wall-street/. Accessed Feb. 4, 2021.

6 Shyam Sunder. Yale Insights. June 17, 2020. “Liquidity Injections May Have Driven the Stock Market Recovery.” https://insights.som.yale.edu/insights/liquidity-injections-may-have-driven-the-stock-market-recovery#gref. Accessed Feb. 15, 2021.

We are an independent firm helping individuals create retirement strategies using a variety of insurance and investment products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic financial planning strategies and should not be construed as financial or investment advice. All investments are subject to risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

-939480 – 06/21

Where Can Expanding Families Find Reliable Financial Advice?

By Soutas Financial | June 15, 2021 | Comments Off on Where Can Expanding Families Find Reliable Financial Advice?
Where Can Expanding Families Find Reliable Financial Advice?

Overview

Obviously, managing money as part of a partnership is vastly different than doing so for oneself. Even more challenging is the need to constantly adapt money skills for a growing family. Most people start out on their own, evolve into a partnership, and from there families grow in interesting ways — including complex relationships with ex-spouses, stepchildren, siblings, parents and in-laws.

For couples, it’s important to understand from the outset that income should not equate to power. One spouse will almost always out-earn the other, but that should not change the delicate and deliberate balance of two equal partners making financial decisions together.

This is a critical point, because income earnings can swing back and forth throughout a long-term relationship. Stay-at-home moms have created cottage industry businesses that become more profitable than dads with a steady job. Layoffs happen. Illness and injury can sideline breadwinners. Everyone has a role, and those roles can morph over time or change on a dime, based on need and circumstances. Keeping a family financially stable is an all-hands-on-deck proposition, so never underestimate either partner’s contribution.

Fortunately, this lesson has become more widely appreciated with each new generation. Today, 54% of all women with a partner earn as much as or more than their spouse. Moreover, nearly one in three millennial and Gen X women are their household’s primary breadwinner.1

Not only is it important for couples to accept that financial management is an equal and shared responsibility, but it can be easier to support each other and achieve goals when they do.

Marriage/Partnering

If you can’t agree on money issues as a couple, it’s only going to get harder as your family grows. To this point, recognize that there is no one way of managing finances that works for everyone. Some people share all of their accounts, others share some accounts but also have individual accounts, which is common because 401(k)s, 403(b)s, IRAs and annuities permit only one owner. Still other partnerships work cohesively when spouses keep their money separate, either contributing to shared bills or dividing expenses equally or based on income.

It is not only essential to find a solution that works best for your partnership, but be aware that your solution may change over time

As years go by, it may make sense to combine accounts — or even separate them if money is a constant source of disagreement. As you determine your financial arrangements, consider the following guidelines.

• Young couples often keep their money separate until individual debts (e.g., student loans, credit card balances, auto loans) are paid off and/or credit scores are repaired.

• Together, establish specific short- and long-term goals, such as saving for a vacation and a down payment on a house.

• Determine specific vehicles and amounts to be contributed. For example, a couple may save for a house via separate Roth IRAs, each contributing $500 a month. They also may save for a vacation through a shared high-interest savings account, contributing a certain percentage of the work bonuses each receives.

• Meet regularly, such as once a quarter, for the specific purpose of monitoring your progress. Support each other to help stay on track, identify any obstacles that occurred that quarter and discuss how you can avoid or compensate for them going forward. Celebrate when benchmarks are achieved — both individual (student loan paid off) or together (vacation goal met). Then set new goals.

• Agree on certain practices, such as how much to spend on entertainment and dining out. Who pays for what? Should you have a joint emergency fund? What is the limit either of you can spend before consulting the other?

“Households tend to divide and conquer. One spouse may take care of the day-today finances, while the other handles the longer-term investments. Both spouses, however, need to understand the entire picture of the household finances should something happen.”2

Children/Education

They say there’s no manual for raising children, but in reality, there are thousands — as a single Google search will reveal. It’s a good idea to read up and even meet with a financial advisor so you understand all of the potential financial needs and risks you take on when starting a family. The following are some basic tips. From there, you and your partner should develop a plan that meets your family’s specific requirements.3

• As soon as each child is born (adopted, joins the family by marriage, etc.), be sure to add them to your health insurance plan. For a newborn, most plans provide a 30- to 60-day window to enroll a new child, during which time the health plan may cover them automatically. This is a good thing to investigate before your child is born (or moved from an ex’s health plan), so you know your timeline to complete this task.

• Be aware that even with just one child, your household budget will continue to change as he or she grows. Young couples frequently are amazed at how much “stuff” they have to buy for an infant. However, that’s a mere microcosm of what’s to come as that child gets involved in extracurricular activities, develops a fashion sense and wants the same videogames and cellphones that his or her friends have. Recognize that whatever your thrifty ideals are at the beginning of parenthood, they will inevitably evolve.

• Before they start a family, a couple may have sufficient life insurance through their employer policies. However, when children come along, they generally need to buy additional coverage for each spouse. Consider expenses that would need to be covered if one or both spouses were to pass away. This includes money needed to continue making housing, utility and debt payments, as well as regular household expenses. It’s a good idea to consult with an insurance agent to help you consider all of your potential needs.

• College is expensive, so it’s best to start saving early. Contributing to a 529 college savings plan can give your money the opportunity to grow tax deferred, so it keeps working as you do. When withdrawn for qualified education expenses, those earnings are typically exempt from federal and, in most cases, state taxes. As your child approaches the end of high school, you may want to consider additional funding options such as scholarships, grants and student loans. However, the less you or your student has to borrow, the better for both of your long-term financial prospects.

• Accept that boomerang kids are a reality. In 2019 alone, 17% of young adults ages 25 to 34 lived with their parents, and that number increased substantially during the pandemic. In fact, in July 2020, Pew Research reported that more than half (52%) of 18- to 29-year-olds lived with their parents. Depending on your child(ren) and your situation, you can work out household contribution plans for things like housing, health insurance, food and family cellphone plans. Ultimately, recognize that parenting these days tends to harken back to the time when adult children lived at home until they got married. You can fight it, but it’s also good to plan for it — or at least don’t be surprised if/when it happens to you.4

Retirement/Estate Planning

Estate planning is not just for wealthy people — or even the elderly. Couples with families — particularly complex modern families — should consider what would happen to their “estate” should one or both spouses pass away. At any age, here are some tips:

• Update beneficiary designations on your financial accounts any time there are changes to your family dynamic, such as marriage, new children, divorce or death.

• Draw up basic documents such as a will, which should include a named guardian for your children, powers of attorney and health care directives.

• Work with qualified professionals to ensure you have adequate financial protection should one or both spouses pass away.

• Maintain a file or notebook for all of your legal documents, financial accounts and insurance policies, including login credentials, any auto-payment information and named beneficiaries.

Parents/Caregiving

Families don’t stop at children. At some point, they can restart with the care of one or more elderly relatives. In fact, a recent survey by T. Rowe Price revealed that approximately one out of three families that look after an aging relative spend at least $3,000 a month related to that care.5 Whether providing direct care for daily living activities or taking over a parent’s money management, the obligations of family finances do not usually stop when the last chick leaves the nest.

In preparation for this eventuality, it’s a good idea to start the conversation early on in your parents’ retirement. They will likely be reluctant to have this discussion, but mention that you are developing a plan for your own retirement so it’s important to understand any additional obligations you may have down the road.

Consider these discussion points:

• If it became necessary, would you consider moving to an assisted living community or do you have the funds to pay for care at home? Or is it your plan that I/we would take care of you?

• Discuss the potential for downsizing and/or living closer to you or your siblings.

• Ask about their overall financial situation, including savings, investments and other valuable assets such as whether they own their home outright, their Social Security income and any insurance policies — including long-term care or a policy with a long-term care rider.

• Inquire about any pending liabilities, such as mortgages or credit card balances.

• Include all appropriate family members, including siblings, in these conversations. This is not just to share responsibilities, but in case something happens to you before your parents pass away.

• Either you or your parents also should maintain a file or notebook with their legal documents, financial accounts and insurance policies, with login credentials, auto-payment information and named beneficiaries. Also include contact information for their doctors and financial advisors.

Final Thoughts

When a couple decides they want to share their life together, regardless of how their family may expand in the future, there are some basic tenets that can help navigate financial challenges:

1. Agree on shared financial objectives and how to achieve them.

2. Don’t keep secrets when it comes to money; be transparent about debt, credit scores, spending habits and separate accounts.

3. Make planning and saving a priority.

Recognize that money is often a catalyst that can end a relationship. By making money discussions a part of your ongoing dialogue, this enables each partner the opportunity to have a say in financial goals and decisions. While couples often divide and conquer household responsibilities, financial decisions should be made together.

This is no different than deciding if and when to have children; it’s that important. Talk often and freely, without judgment. It also can be helpful to develop a relationship with a financial advisor to guide you as your family grows and changes. Sometimes objective, third-party advice is what a couple needs to maintain perspective and prevent money from creating problems in their relationship.

Fresno Financial Planner Takeaways 

As your Fresno financial advisor we thought this was a good takeaway: For couples, it’s important to understand from the outset that income should not equate to power. This is a critical point, because income earnings can swing back and forth throughout a long-term relationship. If you can’t agree on money issues as a couple, it’s only going to get harder as your family grows. Estate planning is not just for wealthy people — or even the elderly. Couples with families — particularly complex modern families — should consider what would happen to their “estate” should one or both spouses pass away.

Diversifying your retirement assets among a variety of vehicles and alternatives—both insurance and investment oriented, depending on what is appropriate for your situation—may offer you a better chance of meeting your retirement income goals throughout your lifespan. We help our clients with problems sometimes associated with retirement such as stopping spend down and avoiding probate. In doing so we leverage Medicare long term care as well as risk management designed to help accomplish those goals.

When searching for Fresno financial advisors, look no further than Soutas Financial & Insurance Solutions Inc. your Fresno portfolio advisor is committed to helping take the complexity out of retirement planning. By using a variety of insurance and investment strategies that focus on Asset Protection, Long-Term Care Strategies, Legacy Planning Tax-Efficient Strategies, IRA, 401(k) & 403(b) Rollovers, Life Insurance, Annuities, Medicare, we can help you develop an overall retirement income strategy specific to you and your family. We have a strong team of professionals helping ensure you receive all the assistance you need not only in developing your retirement income strategy, but in maintaining it throughout your retirement. Contact us today at 559-230-1648 or visit us today at Soutas Financial to get your retirement plans on track for success!

Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Soutas Financial & Insurance Solutions, Inc. are not affiliated companies. California Insurance License # OK48173

Other Fresno Financial Advisor Articles 

Soutas Financial & Insurance Solutions Inc. 
333 W. Shaw Avenue Suite 106
Fresno, CA 93704 
(559) 230-1648 
Soutas.com 

Content prepared by Kara Stefan Communications.

1 Jacqueline Sergeant. Financial Advisor. April 1, 2021. “The Buck Increasingly Stops With Millennial, Gen X Women.” https://www.fa-mag.com/news/the-buck-increasingly-stops-with-millennial–genx-women-61202.html. Accessed April 11, 2021.

2 Judith Ward. T. Rowe Price. March 29, 2021. “Couples and Money: 6 Important Financial Promises to Make.” https://www.troweprice.com/personal-investing/resources/insights/6-financial-vowscouples-should-take-to-heart.html. Accessed April 12, 2021.

3 Mark Vandenburg. Vanguard. Sept. 3, 2020. “Preparing your finances for parenthood.” https:// investornews.vanguard/preparing-your-finances-for-parenthood/. Accessed April 12, 2021.

4 Judith Ward and Robert Young. T. Rowe Price. March 26, 2021. “How to Balance Your Needs With Those of Your Children and Parents.” https://www.troweprice.com/personal-investing/resources/ insights/managing-competing-financial-priorities.html. Accessed April 12, 2021.

5 Ibid.

This content is provided for informational purposes. It is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet the particular needs of an individual’s situation. None of the information contained herein shall constitute an offer to sell or solicit any offer to buy a security. The information and opinions contained herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by AE Wealth Management. Neither AEWM, nor the firm providing you with this report are affiliated with or endorsed by the U.S. government or any governmental agency.

Investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

AE Wealth Management, LLC (“AEWM”) is an SEC Registered Investment Adviser (RIA) located in Topeka, Kansas. Registration does not denote any level of skill or qualification. The advisory firm providing you this report is an independent financial services firm and is not an affiliate company of AE Wealth Management, LLC. AEWM works with a variety of independent advisors. Some of the advisors are Investment Adviser Representatives (IAR) who provide investment advisory services through AEWM. Some of the advisors are Registered Investment Advisers providing investment advisory services that incorporate some of the products available through AEWM. Information regarding the RIA offering the investment advisory services can be found at https://brokercheck.finra.org/.

-939480 – 06/21

Why Is It Important to Protect My Money From Myself As I Get Older?

By Soutas Financial | May 31, 2021 | Comments Off on Why Is It Important to Protect My Money From Myself As I Get Older?
Why Is It Important to Protect My Money From Myself As I Get Older?

As we all get older, an issue that becomes especially important at this stage of life is how to help clients protect their financial resources from an unexpected threat — themselves. One tool is to ask clients to sign a statement authorizing a planner concerned about possible irrational behavior to contact someone, such as a family member or physician, designated by the client. While this would not prevent a client from firing an adviser, it would provide a method of discussing the issue and also involve another person in the decision.

Another possibility is to put clients’ assets into either an irrevocable living trust or a Domestic Asset Protection Trust (in states that allow them) and naming someone other than the client or the planner as trustee. While the client, as the beneficiary, would have the power to fire the trustee, concern about a trustee being fired irrationally could be mitigated to some degree by having a corporate trustee. In addition, with a DAPT, the beneficiary client would not have the power to amend the trust without the agreement of the trustee. This would give some protection against self-destructive choices by a client who was gradually losing competency. One disadvantage of this approach is cost, so it isn’t an option for everyone.

Perhaps the most important strategy is to work with clients to create a contingency plan in the event of mental decline. It could include arrangements to consult with family members or other professionals such as physicians, social workers, and counselors. For clients without close family members, the plan might authorize the financial adviser to call for an evaluation, by professionals chosen in advance by the client, if the client’s behavior appeared irrational. This team approach might alleviate clients’ fears about being judged incompetent by the person managing their assets.

The possibility of mental decline is something no one wants to consider. Yet it’s as essential a financial planning concern as making a will. Helping clients build financial resources for old age includes helping them create safety nets to protect those resources from themselves.

When it comes to insurance, it seems like the journey’s never over. You hear about another type of coverage you need, and you’re pulled into an endless, money-draining exercise!

But here’s the thing: Did you know you could be your own insurance provider by becoming self-insured? No more unnecessary insurance premiums or jargon—just you, your savings and investments and a whole lot of peace of mind.

So, how do you get to being self-insured, and what should you self-insure?

What Is Self-Insurance?

Being self-insured means that you would have enough money to pay for anything an insurance company would usually foot the bill for.

Benefits of Self-Insurance

1. You’re paying less in premiums every year.

If you’re self-insured, you’re not paying an insurance company every year to carry the risk of insuring you. That’s a huge benefit to you, because you’re saving money! And we’re all about saving money where we can—especially on insurance premiums.

2. You’re financially independent when it comes to your investments.

Saving money on insurance premiums means you have more money to put into investments. And if they’re good investments (like a mutual fund), then that’s even better!

3. You can raise your deductibles.

Being self-insured means you can feel confident about raising the deductibles on the insurance you can’t avoid, like your auto, home and health insurance. If you raise a deductible, your premium will go down because you’re agreeing to pay more out of pocket toward a claim.   

Fresno Financial Consultant Takeaways 

Soutas Financial your Fresno financial planner would like to remind you of these great pointers: As we all get older, an issue that becomes especially important at this stage of life is how to help clients protect their financial resources from an unexpected threat — themselves. One tool is to ask clients to sign a statement authorizing a planner concerned about possible irrational behavior to contact someone, such as a family member or physician, designated by the client. Another possibility is to put clients’ assets into either an irrevocable living trust or a Domestic Asset Protection Trust (in states that allow them) and naming someone other than the client or the planner as trustee. You might also consider the benefits of self-insurance.

Diversifying your retirement assets among a variety of vehicles and alternatives—both insurance and investment oriented, depending on what is appropriate for your situation—may offer you a better chance of meeting your retirement income goals throughout your lifespan. We help our clients with problems sometimes associated with retirement such as stopping spend down and avoiding probate. In doing so we leverage Medicare long term care as well as risk management designed to help accomplish those goals.

When searching for Fresno financial advisors, look no further than Soutas Financial & Insurance Solutions Inc. your Fresno retirement plan consultant is committed to helping take the complexity out of retirement planning. By using a variety of insurance and investment strategies that focus on Asset Protection, Long-Term Care Strategies, Legacy Planning, Tax-Efficient, Strategies IRA, 401(k) & 403(b) Rollovers, Life Insurance, Annuities, Medicare, we can help you develop an overall retirement income strategy specific to you and your family. We have a strong team of professionals helping ensure you receive all the assistance you need not only in developing your retirement income strategy, but in maintaining it throughout your retirement. Contact us today at 559-230-1648 or visit us today at Soutas Financial to get your retirement plans on track for success!

Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Soutas Financial & Insurance Solutions, Inc. are not affiliated companies. California Insurance License # OK48173      905978 – 05/21

Other Fresno Financial Advisor Articles 

Soutas Financial & Insurance Solutions Inc. 
333 W. Shaw Avenue Suite 106
Fresno, CA 93704 
(559) 230-1648 
Soutas.com 

Our firm is not affiliated with the U.S. government or any governmental agency. Individuals are encouraged to consult with a qualified professional before taking any withdrawals from their retirement assets or insurance policies.

via As You Age, You Need to Protect Your Money — From Yourself

via Self-Insurance: How It Works and When You Need It

What Should I Avoid Doing When Investing Into My Retirement?

By Soutas Financial | May 28, 2021 | Comments Off on What Should I Avoid Doing When Investing Into My Retirement?
Fresno Financial Advisor News: How To Help Maximize Social Security Benefits

Gone are the days when employees worked for decades for one employer and received a decent pension and Social Security to fund a comfortable retirement. Retirement investing is now a consumer’s responsibility. Ultimately, financial decisions made during your life determine your retirement lifestyle. David Thomas, CEO at Equitas Capital Advisors in New Orleans, says, “From the World War II generation to the baby boomers, we saw the shift from Social Security to self-security. The problem is that all too few are providing for their self-security, and the ones that do are not doing enough.” Workers who depend solely on Social Security for their retirement face a challenge.

Most savers take an on-again, off-again approach to putting money away. They contribute what they can, when they can, and hope for the best. But consistent saving gets the best results, new research shows. This points up the value of strategies like automatic contributions and paying yourself first.

Putting all retirement savings in IRAs and 401(k)s

Investors enjoy the tax-deferral benefits of retirement accounts. But there’s no avoiding the tax man forever. Without additional funds, outside of a retirement account, a retiree withdrawing from a 401(k) is forced to pay taxes on that withdrawal with money from the account. “A better accumulation strategy would be to split savings into both pretax IRA, 401(k) plans and post-tax savings like a brokerage account invested in low-fee exchange-traded funds,” says Martin E. Levine, a chief financial officer at 4Thought Financial Group. That way, investors can increase the retirement account tax-deferral benefits by withdrawing funds at a slower pace.

Investing only in stocks and bonds

Real estate investment trust, known as REITs, and other real estate investments offer another diversification benefit to current retirees and those in the accumulation phase. “The Jobs Act of 2012 changed the game for many investors, opening new doors to diversify their portfolios with more real estate options rather than sticking strictly to stocks and bonds,” said Adam Hooper, CEO and founder of RealCrowd, a crowdfunding commercial real estate firm in Oregon. Real estate investment also tends to be less volatile than the stock market acting as a stabilizer within a portfolio with a strong opportunity for returns, Hooper adds.

Waiting too late to begin retirement saving

With all of the conversation surrounding returns, the most important factor in wealth accumulation is time. An investor who contributes $6,300 per year from age 25 to age 65 and earns 7% annually on the investment can retire with almost a $1.4 million nest egg. In contrast, an investor who starts investing $6,300 per year at age 40 and earns an average 7% annually will only reach $428,000 in savings by age 65. The first investor’s contributions grew nearly five times. This investor contributed a total of $252,000 for 40 years to yield a $1.4 million investment portfolio. While the second investor contributed a total of $157,000 to equal $428,000 at age 65.

Saving through thick and thin over a long period works. Most 401(k) plans make it easy through automatic enrollment, automatic pre-tax contributions and automatic escalation of contributions each year. Don’t opt out. If these features are not available in your plan you can approximate the strategy with automatic contributions to an IRA. In this long-term game, consistency makes the difference.

Fresno Financial Planner Takeaways 

As your Fresno financial advisor we thought this was a good takeaway: Avoid taking an on-again, off-again money saving strategy. It is a far better idea to remain consistent. Investors enjoy the tax-deferral benefits of retirement accounts. eal estate investment trust, known as REITs, and other real estate investments offer another diversification benefit to current retirees and those in the accumulation phase. And don’t wait too late to begin your retirement savings.

Diversifying your retirement assets among a variety of vehicles and alternatives—both insurance and investment oriented, depending on what is appropriate for your situation—may offer you a better chance of meeting your retirement income goals throughout your lifespan. We help our clients with problems sometimes associated with retirement such as stopping spend down and avoiding probate. In doing so we leverage Medicare long term care as well as risk management designed to help accomplish those goals.

When searching for Fresno financial advisors, look no further than Soutas Financial & Insurance Solutions Inc. your Fresno portfolio advisor is committed to helping take the complexity out of retirement planning. By using a variety of insurance and investment strategies that focus on Asset Protection, Long-Term Care Strategies, Legacy Planning Tax-Efficient Strategies, IRA, 401(k) & 403(b) Rollovers, Life Insurance, Annuities, Medicare, we can help you develop an overall retirement income strategy specific to you and your family. We have a strong team of professionals helping ensure you receive all the assistance you need not only in developing your retirement income strategy, but in maintaining it throughout your retirement. Contact us today at 559-230-1648 or visit us today at Soutas Financial to get your retirement plans on track for success!

Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Soutas Financial & Insurance Solutions, Inc. are not affiliated companies. California Insurance License # OK48173

Other Fresno Financial Advisor Articles 

Soutas Financial & Insurance Solutions Inc. 
333 W. Shaw Avenue Suite 106
Fresno, CA 93704 
(559) 230-1648 
Soutas.com 

via 7 Retirement Investment Strategies to Avoid

via How to Double Your Nest Egg for Retirement

We are an independent firm helping individuals create retirement strategies using a variety of insurance products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic retirement income strategies and should not be construed as financial advice.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

905978 – 05/21

How Can I Protect My Retirement From the Ups and Downs of the Coronavirus Market Swings?

By Soutas Financial | May 27, 2021 | Comments Off on How Can I Protect My Retirement From the Ups and Downs of the Coronavirus Market Swings?
Fresno Retirement Advisor News: How Can I Protect My Retirement From the Ups and Downs of the Coronavirus Market Swings?

After weeks of resistance, the U.S. stock market has been laid low by the global spread of the coronavirus (COVID-19). From February 19th through February 27, the S&P 500 fell more than 11%, as the reality set in that our economy will slow at least temporarily as production in major supply markets (namely, China) is curtailed, and consumer spending may decrease.

The coronavirus slide is just the most recent example of how using a three-bucket strategy can make it easier to stay calm(er) during stock sell-offs. With plenty stuffed in a cash bucket and a bond bucket, you can generate the income you need—and take any required minimum distributions(RMDs)—without needing to touch your stock bucket when it is down. But what else can you do?

Tap your cash

Sam Stovall, managing director of U.S. equity research at CFRA, has crunched stock data dating back to World War II and found that when losses are relatively mild (less than a 20% decline) it typically takes no more than four months or so for markets to recover. When a bear descends with losses of 20% or more, the average recovery time is around two years.

Start a side business

One of the safest ways to diversify your income is to create a side business or freelance service. Strategize your choice of a side business by treating it like an apprenticeship. Even if you just want to mow lawns and do some gardening on weekends, use these jobs as an opportunity to figure out how to squeeze in some small business bookkeeping, work on your marketing skills, and upsell clients.

Add a bond buffer

At this life stage you likely have 50% or more of your portfolio invested in bonds. That means that at least half of your portfolio has actually increased in value during the stock slide that started on February 19th. The Bloomberg Barclays U.S. Aggregate bond index —the benchmark tracked by core bond funds— is up 1%. If you are using Treasury bonds in your portfolio, you’ve likely seen an even bigger gain.

Diversify your portfolio

It’s never wise to have all of your financial eggs in one basket, regardless of how safe that seems. Simply throwing everything you have into the same retirement fund without diversification might work out — or it might prove to be a big gamble. You may still end up with a decent retirement, but chances are you could have made hundreds of thousands, if not millions more, simply by diversifying your funds. Domestic stocks, bonds, index funds and REITs, plus ETFs, are just a few places to start.

Pay down all of your debt

Diversifying your income involves paying down your debt. Free up your income by aggressively paying down credit card bills, loans and even your mortgage. Side hustles and upselling clients is one way to find the income to lower those bills, but you can also get creative with techniques like putting your debt on a credit card with no interest fees for a year. Just make sure you pay it off quickly, of course.

Fresno Retirement Advisor Takeaways 

When it comes to Fresno retirement planning Soutas Financial puts your future first. Don’t forget these great reminders: It is worth the effort to protect your retirement funds from the ups and downs of the Coronavirus market swings. Consider the following ways: Tap your cash; start a side business; add a bond buffer; diversify your portfolio; and pay down all of your debt.

Diversifying your retirement assets among a variety of vehicles and alternatives—both insurance and investment oriented, depending on what is appropriate for your situation—may offer you a better chance of meeting your retirement income goals throughout your lifespan. We help our clients with problems sometimes associated with retirement such as stopping spend down and avoiding probate. In doing so we leverage stop spend down as well as long-term care strategies designed to help accomplish those goals.

When searching for Fresno financial advisors, look no further than Soutas Financial & Insurance Solutions Inc. your Fresno financial advisor is committed to helping take the complexity out of retirement planning. By using a variety of insurance and investment strategies that focus on Asset Protection, Long-Term Care Strategies, Legacy Planning, Tax-Efficient Strategies, IRA, 401(k) & 403(b) Rollovers, Life Insurance Annuities, Medicare, we can help you develop an overall retirement income strategy specific to you and your family. We have a strong team of professionals helping ensure you receive all the assistance you need not only in developing your retirement income strategy, but in maintaining it throughout your retirement. Contact us today at 559-230-1648 or visit us today at Soutas Financial to get your retirement plans on track for success!

Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Soutas Financial & Insurance Solutions, Inc. are not affiliated companies. California Insurance License # OK48173

Other Fresno Financial Advisor Articles 

Soutas Financial & Insurance Solutions Inc. 
333 W. Shaw Avenue Suite 106
Fresno, CA 93704 
(559) 230-1648 
Soutas.com 

via Three Steps to Protect Your Retirement from Coronavirus Market Swings

via Diversify Your Income: Protect Your Finances with These Strategies

We are an independent firm helping individuals create retirement strategies using a variety of insurance and investment products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic financial planning strategies and should not be construed as financial or investment advice. All investments are subject to risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

905978 – 05/21

How Will a Wide Distribution of Vaccines Affect the Stock Market?

By Soutas Financial | May 25, 2021 | Comments Off on How Will a Wide Distribution of Vaccines Affect the Stock Market?
Fresno Financial Consultant News: How Will a Wide Distribution of Vaccines Affect the Stock Market?

If there’s one thing that can move the economy and stock market forward, it’s hope. This year, that hope is being presented in the form of COVID-19 vaccines. Economists and Wall Street analysts have long proclaimed that comprehensive economic recovery is not possible until we have contained the virus. The prospect of wide distribution of effective vaccines and herd immunity by the end of the year has put recovery in our crosshairs.1

What does this mean for investors? Review your investment portfolio and get your financial house in order. If we are due for improvement, it could be beneficial to get into the market when prices are low, rebalance often and take advantage of market dips for additional investment opportunities. As always, we are here to help guide on the best way to meet your financial goals.

This hopeful sentiment was echoed by CNBC’s ever-enthusiastic “Mad Money” host, Jim Cramer. He recently proclaimed that the U.S. stock market will be poised for even greater heights if President Biden is successful in forging a plan to quickly and widely distribute the COVID vaccinations.2

Phil Orlando, Federated Hermes’ chief equity market strategist and one of Wall Street’s bullish market analysts, advocates a combination of vaccine rollout and additional fiscal stimulus. He believes one of the surefire ways to boost economic growth is to help lower-skilled unemployed people find work. He predicted that by July 4, the U.S. will be coronavirus-free, setting the stage for a “monster market year.”3

Unfortunately, European stocks continue to struggle despite market exuberance in the U.S. over a new presidential administration. Part of this concern may be that many EU countries have suffered setbacks due to subsequent and more virulent strains of the coronavirus. As before, the U.S. continues to lag on the worst of the effects of the virus as they occur.4 This foreshadowing makes it all the more important that vaccines get into as many arms as possible in the next few months.

Market sectors that have suffered terribly from calls for lockdowns and social distancing are likely to benefit the most from widespread distribution of the COVID-19 vaccine. This includes the aviation and hospitality sectors, as well as the office and retail property market in Europe and the U.S. Of course, the opposite could be true: Pandemic beneficiaries could see a loss in revenues once people get out and about — for example, Amazon, Netflix and Zoom Video.5

Fresno Financial Consultant Takeaways 

Soutas Financial your Fresno financial planner would like to remind you of these points: Economists and Wall Street analysts have long proclaimed that comprehensive economic recovery is not possible until we have contained the virus. One of the surefire ways to boost economic growth is to help lower-skilled unemployed people find work. Market sectors that have suffered terribly from calls for lockdowns and social distancing are likely to benefit the most from widespread distribution of the COVID-19 vaccine.

Diversifying your retirement assets among a variety of vehicles and alternatives—both insurance and investment oriented, depending on what is appropriate for your situation—may offer you a better chance of meeting your retirement income goals throughout your lifespan. We help our clients with problems sometimes associated with retirement such as stopping spend down and avoiding probate. In doing so we leverage strategic wealth management as well as retirement annuity designed to help accomplish those goals.

Are you trying to find an investment advisor? Look no further than Soutas Financial & Insurance Solutions Inc. your Fresno retirement planning advisor is committed to helping take the complexity out of retirement planning. By using a variety of insurance and investment strategies that focus on Asset Protection, Long-Term Care Strategies, Legacy Planning, Tax-Efficient, Strategies IRA, 401(k) & 403(b) Rollovers, Life Insurance, Annuities, Medicare, we can help you develop an overall retirement income strategy specific to you and your family. We have a strong team of professionals helping ensure you receive all the assistance you need not only in developing your retirement income strategy, but in maintaining it throughout your retirement. Contact us today at 559-230-1648 or visit us today at Soutas Financial to get your retirement plans on track for success!

Other Fresno Financial Advisor Articles 

Soutas Financial & Insurance Solutions Inc. 
333 W. Shaw Avenue Suite 106
Fresno, CA 93704 
(559) 230-1648 
Soutas.com 

Content prepared by Kara Stefan Communications.

1 Robin Wigglesworth. Financial Times. Dec. 2, 2020. “The ‘everything rally’: vaccines prompt wave of market exuberance.” https://www.ft.com/content/d785632d-d9a0-45ae-ae57-7b98bb2fb8d6. Accessed Jan. 25, 2021.

2 Kevin Stankiewicz. CNBC. Jan. 20, 2021. “Jim Cramer says the stock market could ‘explode’ if Biden improves Covid vaccine rollout.” https://www.cnbc.com/2021/01/20/jim-cramer-stocks-could-explode-if-biden-improves-covid-vaccine-rollout.html?recirc=taboolainternal. Accessed Jan. 25, 2021.

3 Stephanie Landsman. CNBC. Jan. 20, 2021. “Covid-19 vaccines will end pandemic in U.S. by early summer, Federated Hermes’ chief equity market strategist predicts.” https://www.cnbc.com/2021/01/20/covid-19-vaccines-will-end-pandemic-in-us-by-early-summer-federated.html. Accessed Jan. 25, 2021.

4 Jim Armitage. Evening Standard. Jan. 25, 2021. “FTSE 100 rises slightly as investors balance surging Wall Street with Covid worries.” https://www.standard.co.uk/business/ftse-100-rises-covid-joe-biden-quarantine-b900967.html. Accessed Jan. 25, 2021.

5 Sumathi Bala. CNBC. Nov. 23, 2020. “Hopes for a coronavirus vaccine are creating market winners – and losers.” https://www.cnbc.com/2020/11/23/investing-coronavirus-vaccine-creates-market-winners-and-losers-.html. Accessed Jan. 25, 2021.

We are an independent firm helping individuals create retirement strategies using a variety of insurance and investment products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic financial planning strategies and should not be construed as financial or investment advice. All investments are subject to risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

905978 – 05/21

How Do I Know When To “Buy Low”?

By Soutas Financial | May 24, 2021 | Comments Off on How Do I Know When To “Buy Low”?
Close-up Of A Businessman’s Hand Analyzing Graph On Laptop

The beginning of the year is typically full of hope. We make New Year’s resolutions, and it may take a few months for our enthusiasm (and vigilance) to wane. There’s also the “January Effect,” when the stock market generally gets a performance boost thanks to tax harvesting in December and subsequent reinvestments. But even that phenomenon tends to fade.1

When it comes to investing in the stock market, we recommend a strategic approach. First, you want to consider your big picture — which includes how you ultimately want to use accumulated assets (e.g., college tuition, retirement) and when you’ll need them. You also want to make sure you don’t take on too much risk, so that requires a strategic asset allocation across a diverse group of investments. Finally, one of the basic tenets of stock investing is to buy low and sell high. We can help you with all of these tactics.

We expect 2021 to be an interesting year. Assuming wide distribution of COVID-19 vaccines and successful containment of the virus, the economy should get back on track. But as we saw in 2020, even the coronavirus didn’t have a long-term impact on the stock market.

With that said, Merrill Lynch sees a broad market uptrend in 2021. In equities, the money manager sees upside in cyclical sectors (e.g., financials, materials, industrials), U.S. small-cap value stocks and emerging markets — which are supported by the continued downtrend in the U.S. dollar.2 Bear in mind that while some of these investments pose higher risk, they also follow the tenet of buying low and selling high. The key is to find stocks that are currently selling at low prices but have the potential to rise given (1) the current economic environment, (2) market trends and (3) individual company fundamentals.

When rebalancing, if prices seem too high to reinvest, don’t be hesitant to hold cash for a short time. Investment legend Warren Buffett maintained a highly liquid allocation over the past year, but he did so in preparation to pounce on good buying opportunities when they surfaced.4

On the other hand, there are times when buying low may not be advisable. For example, airline stocks continue to struggle despite congressional relief. Industry experts predict that revenues are unlikely to return to pre-pandemic levels for several years.5

Note that stocks tend to rise on positive news, especially if that news shows some promise of economic growth. A good example of this is when, on Jan. 19, Treasury Secretary nominee Janet Yellen advised Congress to “act big” with regard to increased coronavirus stimulus relief. Following her remarks, the Dow Jones Industrial Average rebounded from a recent losing streak and both the S&P 500 and the Nasdaq made significant gains.6

Fresno Retirement Consultant Takeaways 

As your Fresno financial advisor we thought this was a good takeaway: When it comes to investing in the stock market, we recommend a strategic approach. First, you want to consider your big picture. And one of the basic tenets of stock investing is to buy low and sell high. When rebalancing, if prices seem too high to reinvest, don’t be hesitant to hold cash for a short time. On the other hand, there are times when buying low may not be advisable. For example, airline stocks continue to struggle despite congressional relief. Industry experts predict that revenues are unlikely to return to pre-pandemic levels for several years.5

Diversifying your retirement assets among a variety of vehicles and alternatives—both insurance and investment oriented, depending on what is appropriate for your situation—may offer you a better chance of meeting your retirement income goals throughout your lifespan. We help our clients with problems sometimes associated with retirement such as stopping spend down and avoiding probate. In doing so we leverage strategic wealth management as well as retirement annuity designed to help accomplish those goals.

When searching for Fresno financial advisors, look no further than Soutas Financial & Insurance Solutions Inc. your Fresno portfolio advisor is committed to helping take the complexity out of retirement planning. By using a variety of insurance and investment strategies that focus on Asset Protection, Long-Term Care Strategies, Legacy Planning, Tax Efficient Strategies IRA, 401(k) & 403(b) Rollovers Life Insurance Annuities Medicare, we can help you develop an overall retirement income strategy specific to you and your family. We have a strong team of professionals helping ensure you receive all the assistance you need not only in developing your retirement income strategy, but in maintaining it throughout your retirement. Contact us today at 559-230-1648 or visit us today at Soutas Financial your top financial advisors in Fresno, Ca., to get your retirement plans on track for success!

Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Soutas Financial & Insurance Solutions, Inc. are not affiliated companies. California Insurance License # OK48173

Other Fresno Financial Advisor Articles 

Soutas Financial & Insurance Solutions Inc. 
333 W. Shaw Avenue Suite 106
Fresno, CA 93704 
(559) 230-1648 
Soutas.com 

Content prepared by Kara Stefan Communications.

Eric Reed. The Street. Jan. 17, 2021. “January Effect: What Is It and Why Does It Occur?” https://www.thestreet.com/investing/what-is-the-january-effect. Accessed Jan. 20, 2021.

2 Merrill Lynch. January 2021. “Weak Periods May Be Buying Opportunities.” https://olui2.fs.ml.com/Publish/Content/application/pdf/GWMOL/Viewpoint_January_2021_Merrill.pdf. Accessed Jan. 20, 2021.

3 Sachin Nagarajan. Morningstar. Jan. 15, 2021. “A Responsible Version of Market-Timing.” https://www.morningstar.com/articles/1017362/a-responsible-version-of-market-timing. Accessed Jan. 20, 2021.

4 Theron Mohamed. Business Insider. Jan. 18, 2021. “Warren Buffett advised NFL linesman Ndamukong Suh to be ready to buy when bargains appear.” https://markets.businessinsider.com/news/stocks/warren-buffett-advises-ndamukong-suh-be-ready-buy-bargains-2021-1-1029977459. Accessed Jan. 20, 2021.

5 Alan Farley. Investopedia. Dec. 22, 2020. “Wrong Time to Buy Airline Stocks.” https://www.investopedia.com/wrong-time-to-buy-airline-stocks-5093391. Accessed Jan. 20, 2021.

6 Joseph Woelfel. The Street. Jan. 19, 2021. “Stocks End Higher as Yellen Tells Congress to ‘Act Big’ on Stimulus.” https://www.thestreet.com/markets/stock-market-dow-jones-industrial-average-banks-yellen-011921. Accessed Jan. 20, 2021.

We are an independent firm helping individuals create retirement strategies using a variety of insurance and investment products to custom suit their needs and objectives. This material is intended to provide general information to help you understand basic financial planning strategies and should not be construed as financial or investment advice. All investments are subject to risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

The information contained in this material is believed to be reliable, but accuracy and completeness cannot be guaranteed; it is not intended to be used as the sole basis for financial decisions. If you are unable to access any of the news articles and sources through the links provided in this text, please contact us to request a copy of the desired reference.

905978 – 05/21

How Could Raising the Minimum Wage Affect the Economy?

By Soutas Financial | May 23, 2021 | Comments Off on How Could Raising the Minimum Wage Affect the Economy?
Fresno Financial Advisor News: How Could Raising the Minimum Wage Affect the Economy?

Overview

The legislatively mandated minimum wage is the lowest hourly compensation an employer can pay a worker. Originally, it was introduced in 1938 to prevent factories from exploiting workers by paying them low wages that would keep them in poverty.

It is possible that some of those factories may have gone out of business because they were unable to sustain the higher mandated wage. However, companies with sustainable business models survived the new regulation, and the country thrived after passage of the Fair Labor Standards Act (FLSA).

Today, the federal minimum wage in the United States is $7.25 per hour; for workers whose compensation is partially funded through tips, their minimum wage is $2.13 an hour. However, 29 individual states have established a higher minimum wage, with others scheduled to incrementally increase their state minimum wage over the next several years.2

In fact, 42 cities also have passed legislation to increase the minimum wage above the current federal mandate. Among them, 22 are already requiring an hourly wage of $15 or more.3

President Joe Biden has proposed an incremental plan to increase the minimum to $9.50 this year toward the goal of $15 an hour by 2025. However, in light of lost revenues many businesses have experienced due to the pandemic, Biden recently conceded that perhaps the goal could be adjusted to $12 or $13 an hour by 2025. Thereafter, the plan is to index the federal minimum wage to the median U.S. wage, which is the middle point at which half of workers earn more and half earn less.4

Proponents of the minimum wage increase say it would be instrumental in reducing poverty, mitigating income inequality and boosting employee morale — which, in turn, could improve productivity. On the other side of the coin, opponents believe a mandated increase would cause higher prices and job losses, thus increasing the number of people living in poverty.

Inflation

There are two sides to the inflation theory. One is that when business owners have to pay their workers more, many believe they must raise the price of their goods and services to pay for the wage hike. However, economists say that wages are only one component of the price equation, and in many cases, heightened wages can be offset by higher morale/productivity and lower turnover costs.

The other side of the inflation theory is that if wages do not keep up with overall increases in the cost of living, more and more workers will likely sink into poverty. Less consumer spending reduces product demand, so companies may lose revenues.

The reality is that today’s wages have not kept up with gradual increases in the cost of living over the past decade. In fact, there has never been a lag of 10 years or more before increasing the minimum wage since the Fair Labor Standards Act was passed in 1938.

The last increase was in July of 2009. Since then, general inflation has increased by more than 20%, and the average rent across the country has increased by more than 30%. In short, workers who earn the current minimum wage ($7.25/hour = $15,080/year) can no longer afford a basic one-bedroom apartment (national average $1,470/ month x 12 = $17,640/year) — and that’s not including utilities, food, transportation and insurance.5

Jobs Many business models, especially small mom-and-pop shops, may not be able to sustain a higher minimum wage — even an incremental increase over several years. According to the Congressional Budget Office (CBO), the current proposal to raise the minimum wage to $15 by 2025 would essentially eliminate 1.4 million jobs due to staff cuts and business closures.

However, the CBO also projects that the mandated wage hike would likely increase the incomes of 17 million people, lifting 900,000 out of poverty. So, while there is never one solution that will benefit everyone, the CBO numbers suggest that the advantages of serving 17 million people outweigh the disadvantages of 1.4 million becoming jobless.6 And, consider that once the latter cohort does find other jobs, they too will benefit from the higher mandated wage.

Over the past 25 years, evidence-based research such as that established by the CBO has changed the mindset of many economists on this issue of lost jobs. This evolution started with a report published in 1993 when the state of New Jersey raised its minimum wage. The study compared the impact on 410 fast-food restaurants in New Jersey and in Pennsylvania — which did not raise the minimum wage. Despite having to pay higher wages, restaurants in New Jersey actually added more jobs than those in Pennsylvania.

The researchers concluded two reasons why New Jersey restaurateurs expanded: (1) a slight increase in prices did not dissuade patrons, and (2) happier workers were less inclined to quit, so the increased cost was mitigated by lower turnover and training expenses.7

“Research has shown that raising the minimum wage reduces poverty and has positive economic benefits for workers, their families, their communities and local businesses where they spend those additional dollars,” said Rosemary Boeglin, a White House spokeswoman.8

Economic Advantages To Raising Minimum Wage

Higher wages, particularly among lower-income households, tend to circulate back into the local economy. In fact, small-business owners rely on customers to earn enough income to be able to afford their wares — such as a local eatery, a farmer’s market or an auto mechanic shop. A higher minimum wage is likely to increase consumer spending, creating a higher demand for goods and services and, in turn, more jobs. Ultimately, higher wages can be a pro-GDP growth strategy.

Raising the minimum wage also has the potential to decrease government spending. Higher-earning workers get a lifeline out of poverty, which means less reliance on government welfare programs and tax subsidies. According to the Economic Policy Institute (EPI), if the federal hourly minimum wage is increased to $15 by 2025, the federal government would save between $13.4 billion and $31.0 billion on major public assistance programs.

For example, note the savings projected in the following programs:

• Earned income tax credit (EITC) and child tax credit (CTC) — between $6.5 billion and $20.7 billion a year

• Supplemental Nutrition Assistance Program (SNAP) — between $3.3 billion to $5.4 billion a year

Higher wages also lead to increased income taxes. The EPI projects that the $15 an hour minimum wage would raise an additional $7.0 billion to $13.9 billion in annual contributions to Federal Insurance Contributions Act (FICA) tax revenues, which go to support Social Security and Medicare benefits. Another study found that higher minimum wages give workers who are closing in on retirement a good reason to work longer and delay drawing Social Security benefits.

There are even health benefits associated with a higher minimum wage, presumably due to the ability to afford better health care, healthy food choices and more exercise options. A growing body of research correlates higher minimum wages with a lower incidence of smoking, reduced obesity, lower teen birth rates, fewer alcohol-related traffic fatalities, fewer suicides and higher infant birth weight. In turn, these positive health implications allow for reduced spending by Medicaid, Medicare and Veterans Affairs. And, of course, the healthier the national workforce, the longer people can continue working and contributing to income and payroll tax revenues.9

“Economists no longer reflexively oppose minimum wages, as most once did. Empirical work assembled over the past three decades has demonstrated that modest increases in the minimum wage typically have, at most, small negative effects on employment.”10

Global Competitive Landscape

The stronger the U.S. economy, the better we can compete on the national stage. At present, the U.S. lags other developed countries in the mandated minimum wage. Currently, we rank 12th in the world, but perhaps more importantly, the U.S. minimum wage represents 33% of the nation’s median earnings. This is last among the 31 countries in the Organization for Economic Cooperation and Development. By comparison, Canada’s minimum wage accounts for 51% of median income; France’s represents 62%.11

Final Thoughts

Clearly, there are advantages and disadvantages to increasing the minimum wage. Given that it has been 12 years since the last change, companies may need to start considering how to accommodate potentially mandated increases as part of their staffing budget. The biggest variables are how much the minimum wage will increase and when.

On one hand, now may not be the ideal time for a large wage increase. After all, on the heels of the pandemic, many businesses lost revenues and would not be able to recover if they were required to pay minimum wage staff substantially more. It is worth noting, however, that the U.S. has increased the minimum wage during economic declines in the past. Most notably, the original Fair Labor Standards Act was passed following the Great Depression to help get the country back on its feet.

Just as businesses must make adjustments for operational expenditures, we should all continually monitor our household budget to identify rising costs. With a pending increase in the minimum wage, we may see higher prices for food, entertainment and other common expenses. Slight increases are not likely to break our budget, but all the same, cutting costs in order to mitigate higher outlays is what balancing a budget and long-term planning are all about.

Fresno Financial Planner Takeaways 

As your Fresno retirement plan consultant we felt the following ideas were top notch: Today, the federal minimum wage in the United States is $7.25 per hour; for workers whose compensation is partially funded through tips, their minimum wage is $2.13 an hour. The reality is that today’s wages have not kept up with gradual increases in the cost of living over the past decade. Higher wages, particularly among lower-income households, tend to circulate back into the local economy. Raising the minimum wage also has the potential to decrease government spending. Higher-earning workers get a lifeline out of poverty, which means less reliance on government welfare programs and tax subsidies.

Diversifying your retirement assets among a variety of vehicles and alternatives—both insurance and investment oriented, depending on what is appropriate for your situation—may offer you a better chance of meeting your retirement income goals throughout your lifespan. We help our clients with problems sometimes associated with retirement such as stopping spend down and avoiding probate. In doing so we leverage Medicare long term care as well as risk management designed to help accomplish those goals.

When searching for Fresno financial advisors, look no further than Soutas Financial & Insurance Solutions Inc. your Fresno financial planning consultant is committed to helping take the complexity out of retirement planning. By using a variety of insurance and investment strategies that focus on Asset Protection, Long-Term Care Strategies, Legacy Planning Tax-Efficient Strategies, IRA, 401(k) & 403(b) Rollovers, Life Insurance, Annuities, Medicare, we can help you develop an overall retirement income strategy specific to you and your family. We have a strong team of professionals helping ensure you receive all the assistance you need not only in developing your retirement income strategy, but in maintaining it throughout your retirement. Contact us today at 559-230-1648 or visit us today at Soutas Financial to get your retirement plans on track for success!

Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Soutas Financial & Insurance Solutions, Inc. are not affiliated companies. California Insurance License # OK48173

Other Fresno Financial Advisor Articles 

Soutas Financial & Insurance Solutions Inc. 
333 W. Shaw Avenue Suite 106
Fresno, CA 93704 
(559) 230-1648 
Soutas.com 

Content prepared by Kara Stefan Communications.

1 The Economist. Jan. 30, 2021. “What would a $15 minimum wage mean for America’s economy?” https://www.economist.com/finance-and-economics/2021/01/30/what-would-a-15-minimumwage-mean-for-americas-economy. Accessed March 29, 2021.

2 World Population Review. 2021. “Minimum Wage by State 2021.” https://worldpopulationreview. com/state-rankings/minimum-wage-by-state. Accessed March 29, 2021.

3 Paul Wiseman, Dee-Ann Durbin and Christopher Rugaber. PBS. Feb. 17, 2021. “How economists see Biden’s $15 wage proposal.” https://www.pbs.org/newshour/health/how-economists-seebidens-15-wage-proposal. Accessed March 29, 2021.

4 Ibid.

5 Aimee Picchi. CBS News. July 24, 2020. “It’s been a record 11 years since the last increase in U.S. minimum wage.” https://www.cbsnews.com/news/minimum-wage-no-increases-11-years/. Accessed March 29, 2021.

6 Paul Wiseman, Dee-Ann Durbin and Christopher Rugaber. PBS. Feb. 17, 2021. “How economists see Biden’s $15 wage proposal.” https://www.pbs.org/newshour/health/how-economists-seebidens-15-wage-proposal. Accessed March 29, 2021.

7 Ibid.

8 Ibid.

9 Ben Zipperer, David Cooper and Josh Bivens. Economic Policy Institute. Feb. 2, 2021. “A $15 minimum wage would have significant and direct effects on the federal budget.” https://www.epi. org/publication/a-15-minimum-wage-would-have-significant-and-direct-effects-on-the-federalbudget/. Accessed March 29, 2021.

10 The Economist. Jan. 30, 2021. “What would a $15 minimum wage mean for America’s economy?” https://www.economist.com/finance-and-economics/2021/01/30/what-would-a-15-minimumwage-mean-for-americas-economy. Accessed March 29, 2021.

11 Paul Wiseman, Dee-Ann Durbin and Christopher Rugaber. PBS. Feb. 17, 2021. “How economists see Biden’s $15 wage proposal.” https://www.pbs.org/newshour/health/how-economists-seebidens-15-wage-proposal. Accessed March 29, 2021.

12 World Population Review. 2021. “Minimum Wage by Country 2021.” https://worldpopulationreview. com/country-rankings/minimum-wage-by-country. Accessed March 29, 2021.

This content is provided for informational purposes. It is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet the particular needs of an individual’s situation. None of the information contained herein shall constitute an offer to sell or solicit any offer to buy a security. The information and opinions contained herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed by AE Wealth Management. Neither AEWM, nor the firm providing you with this report are affiliated with or endorsed by the U.S. government or any governmental agency.

Investing involves risk, including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values.

AE Wealth Management, LLC (“AEWM”) is an SEC Registered Investment Adviser (RIA) located in Topeka, Kansas. Registration does not denote any level of skill or qualification. The advisory firm providing you this report is an independent financial services firm and is not an affiliate company of AE Wealth Management, LLC. AEWM works with a variety of independent advisors. Some of the advisors are Investment Adviser Representatives (IAR) who provide investment advisory services through AEWM. Some of the advisors are Registered Investment Advisers providing investment advisory services that incorporate some of the products available through AEWM. Information regarding the RIA offering the investment advisory services can be found at https://brokercheck.finra.org/.

905978 – 05/21b

Fresno Financial Advisor News: How To … Protect Against Pickpocketing

By Soutas Financial | April 29, 2021 | Comments Off on Fresno Financial Advisor News: How To … Protect Against Pickpocketing
Fresno Financial Advisor News: How To … Protect Against Pickpocketing
  • Protect your ID, passport and credit cards with radio-frequency identification (RFID) blocking travel gear.
  • Carry your important documents and currency in zippered cases, preferably with an anti-theft locking zipper.
  • Your back pocket is known to pickpockets as the “sucker pocket” – do not store your wallet there.
  • Carry only one ID card and one credit card in your wallet (not all of them).
  • Copy or take photos of your credit cards and passport in case they’re stolen so you can cancel or place an alert on these accounts quickly.
  • It’s best to use an ATM machine inside a bank to retrieve cash, as they are less likely to have a hidden illegal skimmer installed.

Fresno Financial Planner Takeaways 

When searching for Fresno financial advisors, look no further than Soutas Financial & Insurance Solutions Inc. your Fresno portfolio advisor is committed to helping take the complexity out of retirement planning. By using a variety of insurance and investment strategies that focus on Asset Protection, Long-Term Care Strategies, Legacy Planning Tax-Efficient Strategies, IRA, 401(k) & 403(b) Rollovers, Life Insurance, Annuities, Medicare, we can help you develop an overall retirement income strategy specific to you and your family. We have a strong team of professionals helping ensure you receive all the assistance you need not only in developing your retirement income strategy, but in maintaining it throughout your retirement. Contact us today at 559-230-1648 or visit us today at Soutas Financial to get your retirement plans on track for success!

Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Soutas Financial & Insurance Solutions, Inc. are not affiliated companies. California Insurance License # OK48173 860314 – 03/21

Other Fresno Financial Advisor Articles 

Soutas Financial & Insurance Solutions Inc. 
333 W. Shaw Avenue Suite 106
Fresno, CA 93704 
(559) 230-1648 
Soutas.com 

Corporate Travel Safety. Oct. 24, 2018. “Pickpocketing and RFID Digital Theft Increase: How to Prevent Becoming a Victim.” https://www.corporatetravelsafety.com/safety-tips/pickpocketing-rfid-theft-prevention/. Accessed Oct. 2, 2020.

Our firm provides links to third-party articles in an effort to assist users in locating information on topics that might be of interest to them. Information presented has not been verified and is not guaranteed, nor can we attest to the accuracy of information provided. Linking to an article or website does not constitute a representation of the services offered by our firm, nor does it constitute an endorsement by our firm of the sponsors of the site or the products presented on the site. The information is not intended to be used as the sole basis for financial decisions, nor should it be construed as advice designed to meet the particular needs of an individual's situation.