Jersey benefits Group, Inc. Find Us On Facebook
 
Home > The Kaighn Report > Jersey Benefits Advisors Investor Newsletter Summer 2019
July 13, 2019
Jersey Benefits Advisors Investor Newsletter Summer 2019

MARKET WATCH

By the time you read this synopsis of the first half of 2019, our nation will have celebrated the 243rd anniversary of its independence with fireworks displays from coast to coast.  I hope you were able to take a few days to reflect on the remarkable journey of our nation, are thankful for the service of those who protect our interests, and fully enjoyed the fruits of your own labor by pursuing an activity that provided some well-deserved entertainment.  Now we can all try to work off the burgers, hot dogs and miscellaneous beverages we consumed throughout the holiday.

 

As we ended the first half of the year, the major indices were all very close to their records, and only the Dow Jones Industrial Average (DJIA*) had not breached its October 3, 2018 record high.  The S&P 500* and the NASDAQ* surpassed their previous records several times this spring, and they closed the quarter hovering very close to their all-time highs.  Performance for the first half of this year would be a respectable showing for the entire year, but as we are all aware, there is still a second half to go.

 

So, how good was the performance in the first half?  The DJIA* closed at 26,599.96 for a year to date (YTD) gain of 14.03%, while the S&P 500* ended at 2,941.76 notching a 17.35% YTD increase.  The tech heavy NASDAQ* raced to a record high in April, slipped in May and recovered to finish the first half at 8,006.24 which was a 20.66% YTD performance.  Of course, we had to wait until the abbreviated session before the 4th of July holiday to receive confirmation that our bull market was still alive and well, as the DJIA* surpassed its all time high to close at 26,966.00 while the S&P 500 & NASDAQ* also set records of 2,995.82 and 8,170.23 respectively.  I guess this exposition was just a precursor to the fireworks displays on the actual holiday.  Anyway, it’s a good start for the second half, and we’ll see where things go from here.

 

The Bureau of Economic Analysis (BEA) released the 3rd estimate of first quarter Gross Domestic Product (GDP) on June 27th and the increase of 3.1% was unchanged from the previous estimate.  On July 26th the first estimate of second quarter growth will be released, and while there are some expectations of economic deceleration, it is unlikely the economy fell off a cliff, so to speak, in the second quarter.  So, look for this record setting, ten-year expansion to keep chugging along for the foreseeable future.

 

Meanwhile, that pesky yield curve, of which we spoke in the last missive, is about as flat as it can get, and this means the bond market is predicting, although some might say is forcing, the Federal Reserve to cut short term rates.  We’ll see how that plays out later this month.  If the economy is indeed decelerating, and inflation continues to remain under 2% with unemployment at 3.7%, the Fed may cut interest rates by 25 basis points as soon as its July meeting.  Many experts say you shouldn’t dismiss the bond market, and it is emphatically saying the Federal Reserve went too far, too fast with the pace of interest rate increases.  With interest rates at historically low levels, I’m inclined to think the Federal Open Market Committee (FOMC) might just look at the data on the economy in relation to their mandate, which is price stability and full employment, and hold rates steady to see how long term rates react.  As you can see, there are many forces at work trying to figure out where markets and economy are headed during the second half of the year.  The answers are in the data, and it’s somewhat inconclusive at this point.

 

Tariff and trade issues, as well as unruly foreign actors can upset the delicate balance that keeps global commerce thriving.  Respect for rule of law and property rights, including intellectual property, are at the heart of many of the disruptive disputes around the globe.  Free and fair trade is a goal to which we all aspire, even if it may never be fully achieved.  The good news is that it looks like we are taking a few tactical steps forward on the trade issue, and that is one of the reasons why markets around the world continue to be positive.  If you have any questions about your accounts, or need to discuss retirement plans, college savings plans or other investments, please give me a call or send an email.

OUR PRIVACY POLICY AT JERSEY BENEFITS

At Jersey Benefits Group, Inc. and Jersey Benefits Advisors, we collect and use information from you on applications and other forms as well as information about financial transactions with us and from non-affiliated third parties.  This “nonpublic personal information” is obtained in connection with providing a financial product or service to you. 

 

We do not disclose any nonpublic personal information about you without your express consent, except as permitted by law and only to provide services to you.  We may disclose the nonpublic personal information we collect to persons or companies that perform services on our behalf for your benefit. 

 

We restrict access to your non-public personal information and only allow disclosures to persons and companies as permitted by law to assist in providing products or services to you.  We also maintain physical, electronic and procedural safeguards to protect your nonpublic information in all instances.

 

I hope you had a relaxing Independence Day and if you have any questions or concerns regarding our privacy policy, or if you’d like to discuss your accounts in more detail, please feel free to contact me.

IS THE TIME RIGHT FOR A 529 PLAN?

Are you a parent or grandparent with a newborn or young school-aged child in the family?  Saving money for college expenses is a goal I hear many young parents express, and one of the best ways to build tax-advantaged savings for college is the 529 plan. A 529 plan is a tax-advantaged savings plan designed to encourage saving for future college costs.

 

The 529 plan, legally known as a “qualified tuition plan,” is sponsored by states, state agencies, or educational institutions and is authorized by Section 529 of the Internal Revenue Code.  Changes in the tax code were made in 2006 making permanent the provision that earnings in a 529 plan are tax free upon withdrawal when used for education expenses.  This has resulted in eliminating any change in status for earnings for the 529 plan and made it the premier savings vehicle for college savers.

 

There are two types of 529 plans: pre-paid tuition plans and college savings plans. All fifty states and the District of Columbia sponsor at least one type of 529 plan.   Additionally, a group of private colleges and universities sponsor a pre-paid tuition plan. There are differences between pre-paid tuition plans and college savings plans, and each individual family needs to determine which plan may be right for their needs. Pre-paid tuition plans generally allow college savers to purchase units or credits at participating colleges and universities for future tuition and, in some cases, room and board. Most prepaid tuition plans are sponsored by state governments and have residency requirements. Many state governments guarantee investments in the pre-paid tuition plans that they sponsor.

 

College savings plans generally permit a college saver (also called the “account holder”) to establish an account for a student (the “beneficiary”) for the purpose of paying the beneficiary’s eligible college expenses.  An account holder may typically choose among several investment options for his or her contributions, which the college savings plan invests on behalf of the account holder. Investment options often include stock mutual funds, bond mutual funds, and money market funds, as well as age-based portfolios that automatically shift toward more conservative investments as the beneficiary gets closer to college age. Withdrawals from college savings plans can generally be used at any college or university. 

 

Many state governments offer tax free withdrawals from 529 plans which are sponsored in their state.  This can be an important consideration when choosing a 529 plan.  It is also important to realize that investments in college savings plans that utilize mutual funds are not guaranteed by state govern-ments and are not federally insured. 

 

If a 529 college savings plan seems like a good fit for your overall portfolio, please feel free to contact me for more information to help you with the decision-making process.  While it can seem like an arduous project to choose a 529 plan for your child or grandchild, it is important to realize the younger the child, the more time there is for the investment in the plan to take advantage of market compounding.

Company Information  

John H. Kaighn offers various products and services under the trade name of Jersey Benefits Advisors.

 

PO Box 1406

Ocean City, NJ 08270

Phone: (609) 827-0194

Fax: (856) 637-2479

Email: kaighn@jerseybenefits.com

http://jerseybenefits.com

 

John H. Kaighn is an Investment Advisor Representative & Registered Representative of Royal Alliance Associates, Inc.  Securities and Advisory Services are offered through Royal Alliance Associates, Inc. (RAA) Member FINRA & SIPC.  RAA is separately owned and other entities and/or marketing names, products or services referenced here are independent of RAA.

 

10 Exchange Place

 Suite 1410

Jersey City, NJ 07302

 

Royal Alliance Associates, Inc. is not affiliated with Jersey Benefits Advisors or Jersey Benefits Group, Inc.

 

Insurance Services and Third Party Administration offered through Jersey Benefits Group, Inc., a licensed Insurance Agency in the State of New Jersey.

 

PO Box 1406

Ocean City, NJ 08226

Phone: (609) 827-0194

Fax: (856) 637-2479

Email: kaighn@jerseybenefits.com

http://jerseybenefits.com

 

All opinions expressed in this newsletter are independent of Royal Alliance Associates, Inc. and solely those of John H. Kaighn and Jersey Benefits Advisors.

*The S&P 500, the DJIA, the NASDAQ and others referenced are unmanaged indices that are widely used as indicators of Market Trends. Past Performance does not guarantee future results and the performance of these indices does not reflect the fees and charges associated with investing.  It is not possible to invest directly in an index.

*Dollar Cost Averaging through a systematic savings plan is an excellent way to build an account without a sizeable initial investment.  Saving a portion of our pay each month is very important.  Company sponsored pension plans are one method to save and should be used for retirement.  Other systematic investment accounts, such as ROTH IRA’s, Traditional IRA’s, Coverdell Accounts, 529 Plans, Brokerage Accounts and Annuities can also be opened, and debited directly from checking or savings accounts.  For more information, just call to set up an appointment.  Referrals are always welcome. 

John H. Kaighn




FREE Insurance Quote
The Kaighn Report
Partner Directory
Browse Articles
 

*Jersey Benefits Advisors is a trade name for J/M Kaighn, Inc. a corporation registered in the State of New Jersey, and Jersey Benefits Group, Inc. is a corporation registered in the State of DE.

*John H. Kaighn is a Registered Representative and an Investment Advisor Representative of Royal Alliance Associates, Inc. Securities and investment advisory services offered through Royal Alliance Associates, Inc. member FINRA/SIPC. Royal Alliance Associates, Inc. is separately owned and other entities and/or marketing names, products or services referenced here are independent of Royal Alliance Associates, Inc.

*Insurance services provided by Jersey Benefits Group, Inc., a Licensed Insurance Producer in the State of New Jersey.

*John Kaighn is licensed to offer securities through Royal Alliance Associates, Inc. in the states of CO, DE, FL, IL, MD, NC, NJ, NY, and PA., as well as investment advisory services in NJ. This Website should not be considered a solicitation for securities business or investment advisory services in any other state.

*This web page offers links to other companies. Once a hyperlink is activated, you will be leaving Jersey Benefits Group, Inc., and operate outside Jersey Benefits Group, Inc. Website. Jersey Benefits Group, Inc. is not responsible for the validity, completeness or accuracy of any information provided on those sites to which you may link. Furthermore, Jersey Benefits Group, Inc., Jersey Benefits Advisors and Royal Alliance Associates, Inc. shall not be liable for any direct or indirect system damage or other problems you may incur as a result of linking to any other website, including any consequences arising from your accessing third party technologies, sites, information and programs made available through Jersey Benefits Group, Inc.

Sight2Site Media