Perspectives from the Gamble Jones team

Newsletter – Quarter 3, 2021

The many students who have recently returned to school can only hope for grades like the stock market has posted for most of the year.  Over the past several months, the market has successfully shrugged off a number of concerns, including extended valuations, rising inflation, and a slowdown in the economic recovery caused by the Delta variant of Covid-19.  The result has been an unusually steady climb higher by the market for most of the year with just a few minor blips along the way.  In fact, the S&P 500 has doubled since bottoming in March of 2020 without a single 10% correction during that span.  A rise in interest rates represents the latest challenge for stocks and has added some volatility to the market in recent days.  The result has been the first 5% pullback in the market since just before the election last year, ending what had been the second-longest stretch without such a decline over the past 25 years and the 8th longest streak since 1930.  There has also been some choppiness below the market’s surface throughout the year, with bigger fluctuations among various sectors of the market that have come in and out of favor.  However, the market as a whole has been pretty resilient, with the S&P 500 remaining just a handful of percentage points off its high.

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2021 Retirement Account Contribution Limits

Below are the 2021 tax year contribution/deferral limits. Please review your unique tax situation with a professional before significantly altering your retirement savings tax strategy. Contact us with any retirement planning questions.

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Asset Allocation Review

As the stock market continues to reach all-time highs, we want to encourage you to review your investable assets to make sure your asset allocation is still appropriate based on your goals and risk tolerance.

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Estate Taxes

“Tis impossible to be sure of any thing but Death and Taxes”  – Christopher Bullock (1716)

Federal estate taxes, gift taxes, and generation-skipping taxes compose our current “transfer” tax system.  Estate taxes are imposed upon and paid by the taxable estate before distribution (or transfer) to the beneficiaries.  In contrast, inheritance taxes are imposed upon and paid by the beneficiaries for assets inherited. The federal tax system has used each method in the past but currently uses the “estate” tax system, while the states generally use the “inheritance” tax system.

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Newsletter – Quarter 2, 2021

What a difference a year makes!  This time last year, we were in the midst of lockdowns with a recovery in the stock market beginning to form as technology and stay-at-home stocks propelled the market higher off of the March Covid lows.  Now, a year later, the domestic economy has reopened, and cyclical stocks, which benefit from a strong economy, have taken over market leadership. 

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Planning for Long-term Care

In light of our population’s current demographics and projected longevity, there is a heightened need for long-term care planning.  More people than ever before are expected to require long-term care services and rely on those services for a greater period of time.  In addition, health care costs tend to rise more quickly than general inflation which raises the question of how to pay for long-term care services.  Can you self-insure or should you purchase insurance coverage?  How will you manage a long-term care need?

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Newsletter – Quarter 1, 2021

Only in the mercurial world of the stock market would good news be greeted with such turbulence.  While the prospects for economic and corporate earnings growth have become much rosier in recent months, this optimism has been accompanied by an increase in long-term interest rates that has created some additional market volatility.

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