Archives for December 2017

Cryptocurrencies, such as the best-known version called bitcoin, emerged in 2009 as a means to process electronic payments. As we move further away from a cash-based economy, so much of how we conduct financial transactions is based on two factors: Credit and trust.

In order to extend credit, a financial institution must trust that the consumer will pay it back. The consumer, in return, must trust that the institution will keep his or her personal data, account numbers and other financial information secure. As we have learned during the course of this transition to a cashless society, mutual trust can and is breached quite often.

That chasm is what created a new form of currency, referred to as cryptocurrency because it exists only in electronic form. Instead of trusting a financial institution to securely conduct transactions, it takes the institution – and its accompanying need to collect personal data and impose middle-man fees – out of the trade deal. Cryptocurrency is a direct, peer-to-peer electronic transaction system secured by code that only the entity on the receiving end can read and process.

The transaction is secure, instant, irreversible, anonymous and incurs no third-party transaction fees. Also note that it is not backed, controlled or overseen by any central authority, and all transactions are recorded via a central cloud-based database. Because of the level of anonymity they offer, cryptocurrencies are unfortunately often connected with illegal activity.

At this time of year, many of us are shopping the post-holiday sales. But no matter what time of year it is, the way we buy things has changed dramatically over the last decade. Sure, there are those who still enjoy the rush of finding a great in-store deal, joining the throngs of shoppers during big sale days, and ducking in and out of stores and parking lots.

But for those who don’t, alternatives abound. These range from voicing an Amazon order through a tabletop Alexa device, shopping online on their computers or using their phones or tablets to make purchases.

Some people combine their retail and online shopping resources. A recent survey found that 43 percent of mobile shoppers of electronics buy products on their phones right inside a store after searching for a better price. And nearly 70 percent of shoppers say they want retailers to offer a variety of channels to buy a product, including in-store, online, or buying online and picking up in the store.

Another new trend embraces the idea that cherished experiences are more important than physical products. These may include concerts, weekend vacations or a spa day.

In fact, since 2005, spending in restaurants and bars has grown twice as fast as all other retail spending. Even more remarkable is that 2016 was the first year ever that Americans collectively spent more money dining out than on groceries.

Many investors who have participated in the eight-year bull market have done well. But those approaching retirement may wonder if it’s time to transition assets to more conservative holdings.

Here are factors to consider before making a decision about changing your portfolio: The U.S. economy and markets are still in good shape. U.S. stock valuations continue at above long-term averages, interest rates and unemployment are low and consumer confidence is high. It’s also important to remember that today’s 65-year-olds are statistically likely to live into their 80s.

Based on these factors, some investors with substantial financial resources and who are comfortable with leveraging market risk for longer-term financial goals may want to discuss with their financial advisor whether they should stay the course in their equity allocation even after they retire. Give us a call at (952) 460­-3260, and we’ll be happy to help you weigh the potential risks vs. rewards of your current strategy.

The content provided here is designed to provide general information on the subjects covered. It is not, however, intended to provide specific legal or tax advice. Contact us at info@securedretirements.com or call us at (952) 460­-3260 to schedule a time to discuss your financial situation and the potential role of investments in your financial strategy.