PAST ISSUE – FALL 2010

Are You Your Own Worst Enemy?

Fall 2010

Why do investors so often act against their own best interests and sabotage their investment plan? The answer lies in the relatively new science of behavioral finance.

For the past twenty years, DALBAR Inc., an investment research firm, has published its annual Quantitative Analysis of Investor Behavior. The results, for any investor, are sobering. For the 20 years ending December 31, 2009, the S&P 500 index had an average annual return of 8.20%. During the same period, the annual return for equity fund investors averaged just 3.17%. Fees can account for some of the difference but the rest is credited to investor behavior. To paraphrase the comic strip character Pogo – we have seen the enemy and he is us.

One-On-One Financial Coaching Works Wonders

Fall 2010

How can you make sure your employees are making the most of the benefits you offer them? Can you help them make sound plans for the transition from full-time work to retirement? Are there ways to boost individual productivity by alleviating the stresses that come with financial uncertainty? The short answer to all of these questions is financial education, which can be offered in the workplace through seminars, workshops, online learning and, last but not least, one-on-one financial coaching.

The Art of Aging Well

Fall 2010

Living well into old age is about much more than money. The good life means not only having the financial means to pursue it, you also need to have the physical and mental well being to be able to enjoy it.

At one time people talked about aging gracefully. Not today. With the oldest of the baby boomers starting to sign up for seniors’ discounts, old age is undergoing a major makeover. As they have done with just about every other life phase, baby boomers are setting out to redefine old age. Today, the latter part of life is not about growing older, it’s about aging successfully and that means being active, connected and engaged.

Surprising Summer Rebound

Fall 2010

At the start of the summer, the outlook for markets was subdued at best. The global economy was slowing, possibly slipping back into recession, and the fiscal woes in Europe had many investors wondering how this most recent crisis would play out. Amidst all the uncertainty, equities staged a remarkable third-quarter rally, having the best September since 1939, and the bond market continued to show surprising strength.

Crisis Abates but Growth Remains Slow

Fall 2010

Many of the concerns that gripped the world economy just three months ago appear to have faded. However, continued weak economic growth is not among them.

The threat of a European financial crisis now seems past its peak intensity. Although Europe’s debt problems are not going to go away, there is confidence in how Europe is handling the crisis and investors are now willing to buy Spanish, Portuguese and Greek government bonds. Concerns that China was in the midst of an economic slowdown have been diffused by a string of indicators (industrial production, retail trade, imports and fixed asset investment) that have been stronger than expected. In addition, the risk of another global financial crisis has been reduced through the proposed Basel III regulations that would require a near doubling of banks capital requirements, boosting their balance sheets and helping them to absorb losses.

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