The Nature of Risk
W.A.Smith Financial Group Blog
by admin
1y ago
When you invest money, you are putting it at risk — all investments can lose money. The key is to gauge your risk, and to not put more money at risk than you are willing to lose. This is a relative concept. If you have only $10,000 to invest, then putting $9,000 in a high-risk investment means you could lose almost all of your savings. However, if you have a million-dollar portfolio, putting $10k in a high-risk investment would not be considered all that risky, because a loss of $10k wouldn’t obliterate your portfolio.1 As you can see, evaluating risk is just as personal as your financial goa ..read more
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The Financial Stress Toll (of Late)
W.A.Smith Financial Group Blog
by admin
1y ago
In a recent survey by the American Psychological Association, more than 80% of American adults said they were feeling increased financial stress due to: Higher inflation (87%) Ongoing supply chain issues caused by the pandemic (81%) Global uncertainty due to the war in Ukraine (81%) Furthermore, hardships related to the pandemic — including poor health, loss of loved ones, difficult work and family situations, isolation and inconvenience — have affected the entire nation and the world. In the U.S., 63% of respondents said COVID-19 has changed their life forever.1 A 2021 Employee Financial W ..read more
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Market Volatility: Taken in Perspective
W.A.Smith Financial Group Blog
by admin
2y ago
But remember, this is the situation for which you built a long-term asset allocation strategy. If you haven’t developed such a strategy yet, we are happy to help you do so. We can help identify your long-term goals, particularly with regard to retirement planning and multiple streams of income to help mitigate the risks of outliving your savings. An all-weather portfolio is designed to withstand the types of challenges we have encountered in recent years — and position your assets for growth in the future. Contact us if you would like a portfolio review. It is also important to appreciate whe ..read more
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The War on Oil Prices
W.A.Smith Financial Group Blog
by admin
2y ago
As with any major global conflict, we learn things. The pandemic taught the U.S. the importance of reshoring manufacturing jobs, so we aren’t beholden to other nations, like China, for many of our consumer goods, from medicines to electronics.1 One of the key lessons emerging from the Russia-Ukraine conflict is self-reliance for energy sources, such as oil and gas. Fortunately, the U.S. is the top oil-producing country, accounting for 20% of the world’s supply.2 And yet, although we are not reliant on Russia for our oil supply, crude oil prices — even here in the U.S. — are determined by ..read more
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The Value of Multiple Retirement Income Streams
W.A.Smith Financial Group Blog
by admin
2y ago
Retirement planning was historically a little easier. For instance, the average life expectancy in 1950 was 68 years old.1 If you retired at age 62, your retirement plan might need only six years of retirement income. Additionally, with the decline of defined benefit pension plans, only 14% of private industry employees receive a pension today.2 Since more people are responsible for deciding how much income to set aside for retirement and how to invest that money, they are falling short compared to the days of employer-sponsored retirement income and shorter life expectancies. In fact, r ..read more
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Windfall Imaginings
W.A.Smith Financial Group Blog
by admin
2y ago
Have you ever thought about what you would do if a windfall dropped in your lap? It’s not that unusual. After all: The U.S. is experiencing the greatest wealth transfer in history. Nearly $68 trillion, mostly held by baby boomers, will be transferred to heirs in the next 25 years.1 Since 2018, individual lottery windfalls in the U.S. have ranged between $688 million and $1.59 billion.2 Lots of entrepreneurs build up businesses from scratch and then sell them for a substantial profit.3 No matter your situation, if you are blessed with a windfall, we encourage you to work with professional ad ..read more
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How the Russia-Ukraine Conflict Could Affect Americans
W.A.Smith Financial Group Blog
by admin
2y ago
When Putin invaded Ukraine in late February 2022, President Biden announced sanctions targeting Russian banks, the country’s sovereign debt and Russian oligarchs, warning that Russia would pay an even steeper price if it did not cease its aggression. In the early days of the conflict, European banks braced for the fallout. However, U.S. bank executives believe the industry will remain somewhat insulated from major disruption, having disengaged with the Russian financial sector in recent years.1 In fact, real estate represents one of the weakest links within Russia’s kleptocratic system. Even ..read more
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Are We Back to Normal Yet?
W.A.Smith Financial Group Blog
by admin
2y ago
It’s been two years since COVID-19 hit U.S. shores, but are we anywhere near pre-pandemic normal yet? It doesn’t look like it. The stock market, while volatile, recovered nicely from the initial shock and sustained overall performance for much of the pandemic, until recently. One contributing factor appears to be inflation, which has been rising in recent months to higher levels than we’ve seen in years. There’s a lot of debate as to why that is happening. Some economists say the inflation is pandemic related, given ongoing issues with supply chains, inventory shortages, the labor market and ..read more
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What We Worry About
W.A.Smith Financial Group Blog
by admin
2y ago
Retirement Planning A recent survey found that about 50% of couples do not agree on how much money they should have saved by retirement.¹ However, new research shows that couples who engage in financial planning together tend to be happier and more successful during retirement. Interestingly, couples that score highly on cognitive interdependence (meaning they think of themselves less in individual terms and more as a couple) tend to involve their partners more in retirement planning. Better yet, once they agree on their financial goals for retirement, they tend to have a stronger sense of we ..read more
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An Update on Municipal Bonds
W.A.Smith Financial Group Blog
by admin
2y ago
Municipal bonds are popular among retirees and near-retirees as they seek to reduce market risk and position assets for a lower tax bill. One way to diversify across this sector is to invest in municipal bond mutual and exchange-traded funds. In 2021 alone, that’s where investors placed a record-high $96.8 billion of their money.1 With interest rates expected to rise this year, many investors may enjoy lower municipal bond prices accompanied by higher yields. Furthermore, investors pay no federal taxes on muni bond interest and, in some cases, no state or local taxes.2 Note that bonds with a ..read more
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