However, tariffs may also be used as a geopolitical strategy or a negotiation tactic in trade disputes. Regardless of their intended purpose, tariffs can significantly impact businesses and economies, affecting investment returns. Investors can adjust their strategies and portfolios with tariffs in mind in several ways.

Focusing on Domestic Companies

One way that investors can respond to tariffs is by focusing on domestically focused companies. Companies that generate most or all of their revenue domestically should be less affected by tariffs and trade disputes than companies that rely heavily on international trade. Similarly, industries less insulated from global trade, such as manufacturing, might be a suitable strategy in a tariff-heavy environment.

Portfolio Diversification

Another investment strategy with tariffs in mind is diversification. Diversification is a well-established concept in investing that helps manage risk. By spreading investments across different assets, sectors, and regions, investors can manage the impact of any single investment going bad.

Diversification means investing in different sectors and countries. By investing globally, one manages exposure to any one country’s tariff policies.

Practice Adaptability

Investors may also consider companies that have demonstrated adaptability to tariffs. Some businesses have successfully navigated the tariff landscape by rejigging their supply chains, negotiating with suppliers, or passing costs to customers.

It is important to note that while tariffs can create adversity, they can also create opportunities. For example, if a tariff is applied to a foreign product, it may provide an opportunity for a domestic company producing a similar product to increase its market share. For investors, this could mean a chance to invest in companies that stand to benefit from the tariffs.

Stay Informed

Reading trends and predicting the impact of potential tariffs can be challenging for even the most seasoned investors. Investing with tariffs in mind is about managing losses and maximizing gains by understanding the global economic landscape while mitigating risks.

It requires a keen understanding of international politics and economics. Therefore, it’s vital to rely on guidance from a financial professional who understands how tariffs and other macroeconomic factors impact specific investments.

Important Disclosures:

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by Fresh Finance.

LPL Tracking #731836

Sources:

https://www.forbes.com/sites/rhettbuttle/2025/04/02/tariffs-how-they-work-and-who-is-being-impacted/

https://www.investopedia.com/terms/t/tariff.asp

The post Investing With Tariffs In Mind appeared first on Choice Bank.

However, the good news is that with strategic planning and informed decisions, younger investors can overcome these obstacles and turn their homeownership dreams into a reality.

The Importance of Early Homeownership

Delaying the pursuit of homeownership can have long-lasting effects on financial stability. It’s not just about missing out on the opportunity to build equity; it also hinders the sense of security that comes with owning a home and benefiting from potential property value appreciation. To empower the next generation of investors, here are some strategies to boost young adults over the homeownership hurdle.

Financial Education and Planning

Knowledge is a powerful tool, and everyone should invest time in financial education. Seeking guidance from professionals can help you understand your financial landscape and map out realistic strategies toward homeownership. This includes exploring student loan repayment options, adopting effective budgeting strategies, and creating a savings plan for a down payment.

Exploring Alternative Paths

There’s more than one way to become a homeowner. Younger adults can consider buying a smaller starter home or exploring shared ownership arrangements. These alternatives allow them to enter the housing market sooner, enabling them to start building equity while accommodating their financial circumstances.

Seeking Down Payment Assistance

Many are unaware of the various down payment assistance programs available at the local, state, and federal levels. These programs can provide valuable financial help to those saving for a down payment. To explore eligibility and application processes, consult with mortgage or tax professionals and visit relevant federal, state, and local websites.

Prioritizing Debt Repayment

While the temptation to delay student loan payments in favor of saving for a down payment is understandable, finding a balance is crucial. Prioritizing debt repayment not only improves credit scores but also increases the likelihood of qualifying for a mortgage with favorable terms. A strategic approach to debt management is a key step on the path to homeownership.

Exploring Rent-to-Own Options

Rent-to-own arrangements provide a practical solution for those who want to start building equity while working toward homeownership. This option allows individuals to rent a property with the potential to buy it later, providing a stepping stone towards achieving their homeownership goals.

Planning Matters

For younger investors, overcoming the homeownership hurdle is about more than financial strategies; it’s a journey towards pursuing stability and building a foundation for future financial growth.

By embracing financial education, exploring alternative paths, seeking assistance programs, prioritizing debt repayment, and considering rent-to-own options, young adults can work toward navigating the path to homeownership with confidence and turning their dreams into reality.

Our financial advisors can help you with your plan for buying your first home. Meet with us today.

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

This article was prepared by MainStreet Journal.

LPL Tracking #544400

The post Tips for Younger Investors Buying a First Home appeared first on Choice Bank.

Seeking the help of a professional to assist in one’s wealth planning leaves more time for them to focus on their primary specialty area, thus driving efficiency in managing results. Often, these individuals are focused on their careers, are business owners, or are high achievers with many goals. Here are ten ways a financial professional can assist high-performing individuals work toward improving their financial health.

1. Planning for Goals

A financial professional can develop a customized plan considering income, expenses, financial goals, risk tolerance, and investment strategies. This holistic plan considers all aspects of a high-performing individual’s financial life and aligns them with their goals.

2. Planning for Retirement

It’s vital to start planning early to maintain your desired lifestyle while working and after retirement. Financial professionals will work to understand your retirement lifestyle goals and devise a comprehensive plan based on your goals, risk aversion, and timeline.

3. Investment Advice Based on Your Situation

Investing can be a complex process. A financial professional can help with investment diversification and recommend suitable investment strategies to help manage financial goals.

4. Tax Planning

Efficient tax planning can result in significant financial savings. Financial professionals are equipped to recognize your tax liabilities and objectively propose strategies to mitigate taxes.

5. Risk Management and Insurance

From health insurance to life and property insurance, financial professionals can help you understand the importance of appropriate insurance coverage. Your assets may avoid early depletion with suitable insurance, making insurance essential to asset preservation.

6. Debt Management

Too much debt can hinder financial independence. Financial professionals work with you to determine appropriate strategies for prioritizing and paying off debts, maintaining a healthy credit score, and working toward financial confidence.

7. Estate Planning

Comprehensive estate planning ensures efficient wealth transfer to beneficiaries. Financial and legal professionals together will help guide you through complex processes such as drafting a will, setting up trusts, and tax implications based on your situation.

8. Education Funding

Whether you’re funding your child’s education or returning to school yourself, a financial professional can guide you on appropriate strategies for paying for education without jeopardizing your financial goals.

9. Emergency Funding

Unexpected situations that require immediate financial resources may arise. A financial professional will help develop a strategy for creating an emergency fund and determine the appropriate amount to set aside as you work toward a fully funded emergency fund.

10. Behavioral Coaching

Money decisions often involve a lot of emotions; market ups and downs and other significant life events can derail your long-term financial goals. If your emotions dictate your investment decisions, a financial professional can help you manage them to keep you on track toward pursuing your goals.

Remember, financial wellness is not just about acquiring wealth; it’s also about managing and preserving it for the future. High-performing individuals must seek guidance in this endeavor, as managing finances requires the help of a financial professional, time, and continuous effort.

Important Disclosures:

This material was created for educational and informational purposes only and is not intended as tax, legal, insurance or investment advice. If you are seeking advice specific to your needs, such advice services must be obtained on your own separate from this educational material.

 All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.This article was prepared by Fresh Finance.

LPL Tracking # 538128

Sources

https://www.forbes.com/advisor/investing/financial-advisor/what-is-a-financial-advisor/

The post Asking for Help Is a Strength, Not a Weakness. 10 Ways a Financial Professional Can Assist You. appeared first on Choice Bank.

There are several ways to “mix” your investments. You can invest in different instruments which are also broken up into sectors (both listed below). This is generally called “diversification.” The goal of diversification is to help avoid losing significant money from investments that don’t turn out as you may have hoped. However, just because you are diversified doesn’t mean you selected a safe composition of investments. For example, if you have many different high-risk penny stocks, the diversification may not have done much to decrease the risk that you could lose money. You have to be prudent in your investment decision-making and understand how each asset works.

Some of the investment instruments people consider for their portfolio include:

• Stocks – Fractional ownership interest in a company. If the company does well, the investor tends to do well, and vice versa.
• Bonds – A debt security, like an IOU. Borrowers issue bonds to raise money from investors who earn interest over time.
• Mutual Funds – A company that pools money from investors and invests the money in securities such as stocks, bonds, and short-term debt. Unlike ETFs, mutual funds can only be bought and sold at the end of the trading day.
• Exchange-traded funds (ETFs) – A collection of securities that tracks sectors of the market or seeks to outperform an underlying index. Unlike mutual funds, ETFs trade throughout the day on a stock exchange and their price fluctuates based on supply and demand.
• Fixed-income investments (that aren’t bonds, such as certificates of deposit (CDs), money market funds, and commercial paper. Sometimes preferred stock is considered fixed income since it is a hybrid security bringing together equity and debt features) – Debt instruments that pay a fixed rate of interest.
• Annuities – Financial products that provide a guaranteed income stream. Investors fund the product with a lump-sum payment or periodic payments.
• Derivatives – Financial contracts between two or more parties that determine their value from an underlying asset, a group of assets, or a benchmark. These tend to be higher risk investments and you want to be extremely careful and consult a financial professional before treading in these volatile waters.
• Investment Trusts – A public limited company that strives to earn money through investing in other companies. Investment trusts are closed-ended funds with a fixed number of shares and can only be traded once per day at the end of the trading day. Investment trusts generally cost less to own that a similar mutual fund but are typically more expensive than an ETF.

The sectors investors select from include:

• Industrials – (Stanley Black & Decker, Caterpillar, A.O. Smith, etc.)
• Materials – (Sherwin-Williams, Amcor, Albemarle, Nucor, etc.)
• Real Estate – (Realty Income, Federal Realty Investment Trust, Essex Property Trust, etc.)
• Consumer Staples – (Coca-Cola, Walmart, Proctor & Gamble, Colgate-Palmolive, etc.)
• Energy – (Exxon Mobil, Chevron, Shell, Enbridge Inc, etc.)
• Financials – (LPL Financial, Aflac, Chubb, Franklin Resources, etc.)
• Utilities – (Consolidated Edison, Atmos Energy, NextEra Energy, Duke Energy, etc.)
• Information Technology – (NVIDIA, Apple, Microsoft, International Business Machines (IBM), etc.)
• Healthcare – (Johnson & Johnson, Abbott Laboratories, Kenvue, Pfizer, etc.)
• Consumer Discretionary – (Amazon, McDonald’s, Lowe’s, Target, etc.)

Return on Investment (ROI) and Compounding

Historically (according to officialdata.org), since the inception of the S&P 500 in 1957 the index has produced an annual return of 10.26%. If you are an individual stock picker you know that it is hard to beat the S&P 500 over time. Even the greatest investor of all time, Warren Buffett didn’t beat the S&P 500 over the past twenty years, missing matching its return by .05%.

What is the S&P 500 index? The S&P 500 Index or Standard & Poor’s 500 Index is a market-capitalization weighted index (market capitalization is the total dollar market value of a company’s outstanding shares of stock. Market value is the amount for which something can be sold on a given market) of the 500 leading publicly traded companies in the U.S. It is considered one of the best gauges to measure top-tier American equities’ performance and the overall stock market.

Thanks to the advent of ETFs, in 1993, that mirror the S&P 500, investors are now able to buy shares of funds that aim to produce returns equal, or close that of the S&P 500. For an investor who doesn’t have the time to conduct their own research, these investment options could be part of their overall program to assist in their long-term retirement savings goals.

Another aspect of investing that is often overlooked is the power of compounding. Compounding occurs when your investment begins to earn interest on the interest as well as the principal. The longer you hold the investment the more extraordinary the compounding has the opportunity to become. Albert Einstein is credited with saying, “Compound interest is the eighth wonder of the world. He who understands it earns it; he who doesn’t pays it.” The secret to compound interest working in your favor is being patient. Morgan Housel, the author of The Psychology of Money, said, you don’t have to be particularly smart or lucky to do well in the stock market. You just have to invest according to your risk tolerance and then be patient. Warren Buffett’s partner, investing legend Charlie Munger once said, “The first rule of compounding: Never interrupt it unnecessarily.” The concept when it comes to compounding and value investing over many decades is to buy and hold and wait. But first you have to figure out your risk tolerance.

Determine Your Risk Tolerance

Everybody has a different risk tolerance based on their income level, lifestyle, life experiences, and many more factors. It is critical that you figure out your own risk tolerance and not somebody else’s because of FOMO (anxiety that something exciting is happening and you are missing out), which can be damaging to your finances and significantly impact your financial condition and strategy.

Allocation of Assets

Based on your risk tolerance and your investment goals, you want to decide how you plan to allocate your investments, for example, a percentage in stocks, bonds, etc. This includes how much you want to keep on hand in cash.

While asset allocation does not ensure a profit or protect against a loss, being consistent with your investment allocation helps to lower volatility as you maintain your portfolio diversification. It helps to stay focused on your long-term goals and reduce impulsive decision-making based on speculative news. Remember, it is impossible to predict the future of the market or its volatility as much as it is futile to try and predict natural disasters, wars, and pandemics. Things happen in life, but consistency can help you navigate those unpredictable times.

Invest in What You Know

When it comes to investing, experienced investors often reiterate the importance of investing in what you know.

• Choose businesses and companies that you are familiar with their products and services.
• Do your research to get an understanding of the various investment vehicles available.
• Start with investments that you are familiar with.
• As you become more knowledgeable about how investing works you can begin to expand your portfolio with various forms of instruments and strategies.

Work to Master the Fundamentals

It is hard to earn a dollar, but it isn’t as hard as you might believe to build wealth over time with the right guidance and strategy. And, you don’t have to have a high-income job to do it. Think of investing as you would golf, boxing, or any other sport or skilled hobby. We’ll use golf and boxing in this example: The next time you watch either sport, notice each player’s swing looks different and in boxing each fighter’s stance is unique, however, despite their different approaches they still are able to put themselves in the position to win. This is because they understand the fundamentals. Investing is the same thing. You don’t have to have the same stock portfolio as your neighbor, co-worker, relative, or investing guru to do well over time. As long as you understand the fundamentals of investing and create the mix of investments that works for you, you can be unique and manage your wealth using your own strategy.

Everybody’s retirement and financial goals are different, their strategies are unique to them, their life experiences are distinct from their friends and neighbors, and the reasons why they make the decisions they do are personal. There is no right or wrong mix of investments when you are building a portfolio, however, there are strategies that may help you lower some of the risk of investing while preserving and working to grow your wealth.

If you have invested for a while, you probably understand that there are absolutely no guarantees that you will come out on top as an investor. Most great investors from Warren Buffett to Peter Lynch had a mentor that they learned from. They weren’t just born with financial acumen. Warren Buffett learned from Benjamin Graham. Peter Lynch’s lifelong mentor was George Sullivan. Getting help so you can improve your financial situation is a step that highly motivated investors take.

Consider Consulting a Financial Professional

Want to learn more about your retirement planning? Just as history’s most notable investors sought the help they needed, you too can do the same. Consider consulting a financial professional to help you create an investment portfolio and strategy that can align with your retirement goals.

Meet Our Team

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.  All indexes are unmanaged and cannot be invested into directly.

An investment in Exchange Traded Funds (ETF), structured as a mutual fund or unit investment trust, involves the risk of losing money and should be considered as part of an overall program, not a complete investment program. An investment in ETFs involves additional risks such as not diversified, price volatility, competitive industry pressure, international political and economic developments, possible trading halts, and index tracking errors.

Because of their narrow focus, investments concentrated in certain sectors or industries will be subject to greater volatility and specific risks compared with investing more broadly across many sectors, industries, and companies.

There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by Marketing Solutions.

LPL Tracking #659526

Sources:

Guide to Fixed Income: Types and How to Invest (investopedia.com)

Bonds | Investor.gov

Derivatives 101: A Beginner’s Guide (investopedia.com)

S&P 500 Returns since 1957 (officialdata.org)

Warren Buffett Has Underperformed the Stock Market for the Last 20 Years (linkedin.com)

Quote by Albert Einstein: “Compound interest is the eighth wonder of the w…” (goodreads.com)

The post Choosing the Right Investment Mix is Key to Your Retirement Plan appeared first on Choice Bank.

Willingness to be Patient

Investing in the stock market is complicated. The complexity doesn’t just come from trying to make sense of the endless ratios and calculations that people come up with in an attempt to predict how the market will fluctuate and how companies will perform over time. It comes from their ability to be patient in world that magnifies immediate gratification.

According to a study from the University of California at Berkley, over time, 90% of investors lose money. Not only was this prevalent back in 2009, it still holds true today. People jump on trends, buying and selling to get the quick buck. The market doesn’t approve of shortcuts. The potential for doing well in the market comes more from time and patience than anything else. “The stock market is a device for transferring money from the impatient to the patient,” says Warren Buffet, the world’s greatest value investor, highlighting the importance of having a long-term strategy.

Money, if invest carefully, may grow over time because of compounding. Compounding kicks in decades down the road. It doesn’t happen overnight. According to a Barron’s study, Warren Buffett earned over 90% of his net worth after the age of 65. He started investing at the age of 10 and has done it consistently for over 80 years. He is living proof there is something to be said about patience.

Emotional Stability

One of the biggest mistakes people made in 2008 when the market crashed primarily due to the housing bubble bursting, was panic selling. Investors began losing money hand-over-fist and started selling their interests for fear we were falling into a new Great Depression. Watching your net worth being decimated before your eyes is a traumatizing experience. Unless you are going through it, you have no idea how scary that is.

Even people who are not high-net-worth panic when a bear market growls, and it is human nature to sell, though not necessarily the optimal approach. Investopedia states, ” Those who stayed invested during these difficult times perhaps came out in the best shape.”

Be Diversified

Owning several different assets (diversifying) is one way to help mitigate the overall risk of your portfolio and market uncertainty and volatility. However, you will never be entirely risk-free. All investing involves risk. But taking steps to be diversified and owning different types of investment instruments, from stocks and bonds to index and mutual funds, treasury bills, certificates of deposit, and even real estate work to lower the risk of losing everything should one of the investments experience a significant decline.

Invest Within Your Means

Investing within your means begins with living within your means and understanding your income versus your expenses, your spending habits, why you buy what you buy, and your ability to create and follow a budget. On the Temple of Apollo in the ancient Greek district of Delphi, there is an inscription, “Know thyself.” Two of the most cogent words ever put together. Once you have a better understanding of how you behave, work on investing within your means, meaning only gamble in the market what you are safely willing to lose without that risk interfering with your happiness or financial responsibilities.

Consult a Financial Professional

Maybe the smartest strategy you can do working to stay ahead of uncertain markets is to consult a financial professional. With their help, you can find out where you stand in your current financial position, where you would like to be in the short and long term, and how certain decisions may impact these strategies and goals.

Meet With One Of Our Financial Professionals

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by LPL Marketing Solutions

LPL Tracking # 552419

Sources:

3 Reasons to Not Sell After a Market Downturn

Shocking But True: 90% of People Lose Money in Stocks | Medium

Just How Much Do Individual Investors Lose by Trading?

Why 90% of New Investors Lose Money in the Stock Market?

Introduction: Socrates and the precept “Know yourself” (Chapter 1) – Socrates and Self-Knowledge

Gnothi Seauton. Know Thyself. – The Kensington Sierra Madre

Warren Buffett Has Amassed Over 90% of His Wealth Since He Turned 65

The 200 best investing quotes of all time

The post Smart Strategies for Staying Ahead in Uncertain Markets appeared first on Choice Bank.

Defined contribution plans, such as 401(k) plans, are the most popular employer-sponsored retirement plan in the United States. According to recent statistics provided by the Investment Company Institute, there are about 600,000 401(k) plans in the U.S., covering approximately 60 million active participants and millions of former employees and retirees.

And while each 401(k) plan is structured basically the same, each plan offers different tools for employees. One tool that is often – but not always – offered is the ability to allow participants (employees) to borrow a portion of their account balance.

Let’s examine the benefits and drawbacks in simple terms:

The Benefits

• Paying You. When you pay your 401(k) loan back, you are, in effect, paying interest to yourself. It all goes back into your account.
• In practical terms, if the interest rate you are paying yourself equals or exceeds the rate of return you are earning on the unborrowed portion of your account, you are not hindering the long-term growth of your 401(k). Unfortunately, there is no way to know this with any certainty.
• Easier Access. Often times, a loan from your own 401(k) is just easier for you because there are no credit checks or as many hassles compared to more traditional loans. However, there will be paperwork to fill out and it usually takes time to process, so don’t expect to receive your loan proceeds the next day.

The Drawbacks

• The interest portion of loan repayments usually is not tax deductible.
• These loans have limits and they are usually short-term.
• Amounts not repaid on time will be viewed as taxable withdrawals by the Internal Revenue Service and may be subject to penalties.
• If you leave the company, your employer may demand full repayment within 60 days; you might owe taxes, and possibly penalties, on the unpaid balance.
• Fees. There are usually a variety of loan costs, in addition to interest – just like most other loans. These might include origination or administration fees and they can add up quickly.
• Missing out on market returns. As mentioned earlier, if the interest rate you are paying yourself equals or exceeds the rate of return you are earning on the unborrowed portion of your account, you are not hindering the long-term growth of your 401(k). However, the opposite is true because the cash you borrow does not earn the market rate that would have been accumulated if the money had been left in the account, which could be higher, depending on how the market performs and the investments selected, of course.
• Less retirement readiness. Taking a 401(k) loan will usually hurt your retirement nest egg from a psychological perspective. In fact, Fidelity Investments found that borrowers contribute an average of 2 percent less to their 401(k) plans while paying off the loan and for two years beyond the loan repayment date.

The Choice is Yours

If you need to borrow money for some unforeseen event, you should consider all credit sources available to you and select the source best suited to your needs. Tapping into your 401(k) plan might be the right decision for you, but consider all your options first.

And talk to a financial professional.

Meet our Team

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual security. To determine which options may be appropriate for you, consult your financial professional.

The information provided is not intended to be a substitute for specific individualized tax planning or legal advice. We suggest that you consult with a qualified tax or legal professional.

All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.

Your Bank (“Choice Bank”) provides referrals to financial professionals of LPL Financial LLC (“LPL”) pursuant to an agreement that allows LPL to pay the Financial Institution for these referrals. This creates an incentive for the Financial Institution to make these referrals, resulting in a conflict of interest. The Financial Institution is not a current client of LPL for advisory services. Please visit https://www.lpl.com/disclosures/is-lpl-relationship-disclosure.html.

This article was prepared by RSW Publishing.

LPL Tracking #1-05246421

The post Understanding 401(k) Loans appeared first on Choice Bank.

Deflation

Deflation is the opposite of inflation. It is a term used to outline the decline in the price level across the economy, not the growth rate of the price level (disinflation). Deflation can be triggered by a decrease in the supply of money and credit, growth in productivity and the abundance of goods and services, and a decrease in aggregate demand.

One thing to remember is that, according to the Federal Bank of San Francisco, it is relatively difficult to differentiate between low inflation and modest deflation. This can occur when biases arise in the measurement of the Consumer Price Index (CPI), which is normal.

A couple of significant periods of deflation occurred, for example, between the years 1930 and 1933 when prices dropped an average of about 7% each of those years. This period was known as The Great Depression. In the 21st century, from December 2007 to June 2009, the country experienced what was known as the Great Recession. The reason for this happening is not known for sure, as it could have been a number of factors; however, economists have speculated that the unusually high cost of borrowing may have been a major catalyst.

Disinflation

Disinflation is a temporary slowing of the rate of price inflation. This could occur because of technological or productivity advancements, a curtailment in the money supply, or companies increasing prices at a slower pace within a contracting business cycle. Think of it as a productivity surge boosting real GDP growth, yet the inflation rate continues downward. It is not something investors should be very concerned about. Disinflation is not uncommon and can viewed as normal during healthy economic stretches.

To clarify, inflation and deflation refer to the movement of prices. Disinflation is the change in the rate of inflation. Inflation is the U.S. dollar’s purchasing power and how expensive goods and services have become over a specified period.

During periods of disinflation, stocks and bonds tend to perform well, particularly when a central bank is lowering interest rates.

From 1980 through 2015, the U.S. economy experienced one of the most prolonged periods of disinflation in the country’s history. This occurred after the Great Inflation of the 1970s when prices increased more than 110%, and inflation reached 14.76% entering 1980, forcing the Federal Reserve to implement a monetary policy to reduce it.

What Does all of This Mean for the Average Consumer?

Depending on what type of an investor you are, deflation and disinflation could play a significant role in your financial and investment decision-making. Regardless of your investment strategy, having a diversified portfolio can help mitigate some of the risks involved in investing. However, there is no way to completely eliminate risk when investing in any security. When the economy is in the grips of deflation or disinflation, there are a few strategies to help make your money work for you.

Investment ideas during periods of Deflation

• Consider looking into investing in dividend-paying stocks.
• Discuss High-Interest Savings Accounts (HISA) with your financial professional.
• Read up on Investment-grade (IG) bonds to determine if they are beneficial.

Investment Ideas During Periods of Disinflation

• Consider researching investments that are sensitive to interest rates, like bonds. In the early 2000s during disinflation, the Fed lowered interest rates, which allowed bonds to generate above-average returns. Keep in mind that decent returns on past investments do not guarantee future results.
• Research assets with fixed cash flows like money market funds.
• Industries like manufacturing, transportation, and construction may not be as particularly strong during periods of disinflation.

Get the Investment Advice you Need

It is important to remember that nearly all the well-known investors you study to learn about the market had mentors who guided them until they, themselves, became mentors. Make the time to consult your financial professional to learn how your financial decisions will impact you and align with your financial strategy and goals.

Meet With One of Our Financial Professionals

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

Investing in stock includes numerous specific risks including: the fluctuation of dividend, loss of principal and potential illiquidity of the investment in a falling market.

An investment in the Money Market Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price.

There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by LPL Marketing Solutions

LPL Tracking # 511062

Sources:

Understanding Deflation | San Francisco Fed (frbsf.org)

Understanding Deflation vs. Disinflation (investopedia.com)

Disinflation: Definition, How It Works, Triggers, and Example (investopedia.com)

Monthly inflation rate U.S. 2023 | Statista

Were There Any Periods of Major Deflation in U.S. History? (investopedia.com)

Disinflation: Definition, How It Works, Triggers, and Example (investopedia.com)

The post Deflation, Disinflation, and Why Investors Need a Plan for Both appeared first on Choice Bank.

What Part of My Account Can I Convert?

Assuming your 401(k) allows in-plan conversions, you can convert any vested part of your 401(k) plan account into a designated Roth account regardless of whether you’re otherwise eligible for a plan distribution. Reminder that plans aren’t required to allow in-plan conversions, so check with your financial advisor on if your plan allows them.

Keep in mind that if you’re entitled to an eligible rollover distribution, you can always roll those dollars into a Roth IRA instead of using an in-plan conversion.

What Else do I Need to Know?

If you have the choice of an in-plan conversion or a rollover to a Roth IRA, which should you choose? There are a number of factors to consider:

• In general, the investments available in an employer 401(k) plan are fairly limited, while virtually any type of investment is available in an IRA (on the other hand, your 401(k) plan may offer investments that you can’t replicate in an IRA, or that aren’t available at similar cost).
• An IRA may give you more flexibility with distributions. Your distribution options in a 401(k) plan depend on the terms of that particular plan, and your options may be limited.
• Finally, 401(k) plans typically enjoy more protection from creditors under federal law than do IRAs. Please, consult a professional if creditor protection is important to you.

Other Things to Consider

When evaluating whether to initiate a rollover from an employer plan to an IRA, always be sure to keep the following in mind:

1. Ask about possible surrender charges that may be imposed by your employer plan, or new surrender charges that your IRA may impose.
2. Compare investment fees and expenses charged by your IRA, and investment funds, with those charged by your employer plan, if any.
3. Understand any accumulated rights or guarantees that you may be giving up by transferring funds out of your employer plan.

Whether a Roth conversion makes sense financially depends on a number of factors, including your current and anticipated future tax rates, the availability of funds with which to pay the current tax bill, and when you plan to begin receiving distributions from the plan. Also, you should consider that the additional income from a conversion may impact tax credits, deductions, and phaseouts; marginal tax rates; alternative minimum tax liability; and eligibility for college financial aid.

Have questions about 401(k) in-plan Roth conversions? We would love to connect with you!

Important Disclosures:

This information is not intended as tax, legal, investment, or retirement advice or recommendations.

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

The information provided is not intended to be a substitute for specific individualized tax planning or legal advice. We suggest that you consult with a qualified tax or legal professional.

LPL Financial Representatives offer access to Trust Services through The Private Trust Company N.A., an affiliate of LPL Financial.

This article was prepared by Broadridge.

LPL Tracking #1-904197

The post 401(k) In-Plan Roth Conversions appeared first on Choice Bank.

Review Your Asset Allocation

Market volatility can often provide the first clue that you’re just not comfortable with your current asset allocation. If you’re fully invested in stocks and the idea of a 20 percent (or higher) drop has you considering pulling your funds out of the market, it may be worth investigating whether you should diversify into a few more conservative options. On the other hand, if you’re dissatisfied with your rate of return when compared to the broader market indexes, you may want to invest more aggressively.

Your ideal asset allocation will depend on a few factors:

• Your risk tolerance
• Your investment horizon
• Your investment purpose such as  retirement, paying for a child’s college, a down payment, a wedding, or long-term savings

For short-term investments, it’s often advised to keep your funds in a more stable set of assets, like high-yield savings accounts, certificates of deposit, or government bonds. Meanwhile, more long-term investments are often best kept in the market, where they can take advantage of compounding returns.

Take Full Advantage of Your Retirement Plan

If your employer offers a 401(k) match and you’re not contributing enough to take full advantage of it, this is something you should change today. Retirement matches are essentially “free” money, as they aren’t calculated as part of your gross salary. By contributing to retirement up to your employer’s match, you’ll be able to basically double your retirement contribution with minimal impact on your paycheck.

And for those who would like to start contributing more to their retirement accounts, setting aside a certain percentage of every raise can be a way to increase retirement savings without reducing your pay.

Get Rid of Losing Stocks

Although many claim you don’t really lose money on a stock until you sell it at a loss, there’s an opportunity cost that comes when you tie up money in a stock for years without seeing a positive return. At least once a year, it’s a good idea to review your investments, identify any “losers,” and consider whether it’s time to finally let them go.

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

Asset allocation does not ensure a profit or protect against a loss.

There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.

All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by WriterAccess.

LPL Tracking #1-05268284

The post Investor Summer School: 3 Investing Moves to Make Before Summer is Over appeared first on Choice Bank.

Here are 6 myths that we want to bust! Hopefully, Zeus doesn’t punish us for sharing them:

Myth # 1 – Investing in the stock market is too risky

Many are wary of investing in the stock market for fear that they will lose all of their money should the market dramatically take a turn for the worse. One way to mitigate this fear and manage your risk is to have a diverse portfolio. Having a diverse portfolio involves a variety of stocks (ownership in different companies) and also owning several different kinds of investments, from stocks to bonds to short-term investments to name a few. If there happens to be a downturn in the market and one of the stocks doesn’t perform well, having multiple types of investments could potentially lessen the blow. But when it comes to investing, it is about understanding how the market works and being mindful of your risk tolerance.

Another risk-aware method of investing in the stock market to consider is investing through exchange-traded funds or mutual funds, where your money is pooled with other investors and used to purchase securities. Doing so provides you ownership in several companies while simultaneously creating diversity within your portfolio. These funds are professionally managed, adding another layer of risk management. They are affordable, and investors can easily redeem their shares anytime.

Time is also a factor when you invest money. If the market is bullish for a time, having a long-term strategy can allow the investment time to recover over the long haul. If your intention is slow, long-term growth with a diversified portfolio, the risk factor decreases even more.

Myth # 2 – You will be in a lower tax bracket when you retire

Many workers believe that they will fall into a lower tax bracket when they retire. However, this is only sometimes the case. There are a couple of reasons why this might not happen:

• Future tax rates may be higher than they are today. A good example of this is happening right now. Prior to the Tax Cuts and Jobs Act, which took effect Jan. 1, 2018, the top tax bracket was 39.6 %. Currently, it is 37%, although this may increase once again to 39.6% in 2026 when the Tax Cuts and Jobs Act sunsets. As the government and the market continually evolve, it is hard to say what your tax bracket will be when you finally retire, or how it may fluctuate in the years after retirement.
• After retirement, you have fewer tax deductions. If your kids are grown, there will be no dependents to claim. If your house is paid off, there will be no mortgage interest deduction and no annual tax-deferred contributions to your 401(k) to reduce income.
• Withdrawals from your retirement account can bump you into a higher marginal tax bracket. This is primarily a concern for individuals in the top tax bracket. When you withdraw from a retirement account, you don’t pay higher taxes on your other income; instead, you pay just on the retirement account withdrawal. However, consult with a financial professional and discuss how much you can withdraw without exceeding your bracket’s maximum.

Myth # 3 – You can’t contribute to an IRA after you retire

Even if you are retired, you can still contribute to traditional or Roth IRAs if you have earned income. Your contributions to a traditional IRA may be tax-deductible. Earned income is generated by a wage, salary, bonus, or tips, so you would have to have some kind of part-time work. Neither interest nor Social Security qualifies as earned income.

Myth # 4 – Saving for retirement is hopeless if I start late or contribute small amounts

It seems like a while down the road before you have to retire, and right now, you can only contribute a small amount, so what good would that do? But money has a way of accumulating, especially if you start investing early. However, it is never too late to begin saving for your retirement. Discussing your plans and financial condition with a financial professional is a good way to learn effective methods to pursue your retirement goals.

Myth # 5 – All debt is bad debt

The word debt comes with uneasy connotations; however, not all debt is bad. In a nutshell, having “good” debt refers to money that was borrowed to increase your income over time, like student loans, a business loan, or a home mortgage. “Bad” debt, on the other hand, is considered money spent that doesn’t help your financial position, for example credit card debt, personal loans, or even an auto loan.

Myth # 6 – It is impossible to know today how much money you will need to retire

Every year the cost of living and inflation continues to rise, and the market regularly fluctuates. In times of a bullish market, it seems like the market will never turn, but historically speaking, over the past century, the stock market has averaged a return of about 10 percent per year. When we were young, our parents encouraged us to save around 10 percent of every paycheck and put the money toward retirement. Today, financial professionals suggest saving 20 percent, which includes employer contributions.

A helpful way to bust money myths and develop a suitable financial strategy is to consult with a financial professional who can help guide you on your financial journey.

Important Disclosures

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial professional prior to investing.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.

Past performance is no guarantee of future results.

There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.

An investment in Exchange Traded Funds (ETF), structured as a mutual fund or unit investment trust, involves the risk of losing money and should be considered as part of an overall program, not a complete investment program. An investment in ETFs involves additional risks such as not diversified, price volatility, competitive industry pressure, international political and economic developments, possible trading halts, and index tracking errors.

Investing in mutual funds involves risk, including possible loss of principal. The funds value will fluctuate with market conditions and may not achieve its investment objective. Upon redemption, the value of fund shares may be worth more or less than their original cost.

Contributions to a traditional IRA may be tax deductible in the contribution year, with current income tax due at withdrawal. Withdrawals prior to age 59 ½ may result in a 10% IRS penalty tax in addition to current income tax.

The Roth IRA offers tax deferral on any earnings in the account. Withdrawals from the account may be tax free, as long as they are considered qualified. Limitations and restrictions may apply. Withdrawals prior to age 59 ½ or prior to the account being opened for 5 years, whichever is later, may result in a 10% IRS penalty tax. Future tax laws can change at any time and may impact the benefits of Roth IRAs. Their tax treatment may change.

This information is not intended to be a substitute for specific individualized tax advice We suggest that you discuss your specific tax issues with a qualified tax advisor.

All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.

This article was prepared by LPL Marketing Solutions

LPL Tracking # 1-05357584

The post 6 Money Myths That Are Limiting Your Wealth appeared first on Choice Bank.