People of different ages see the world through their own unique lens and sometimes have a hard time accepting the habits of other generations. Understanding these differences has never been more important for a financial advisor, both in terms of their impact on the workplace and in managing multigenerational client relationships.

 

* In U.S. dollars as of June 30, 2019. Source: Ameriprise Q2 Earnings Release. Contact us for more current information. © Morningstar as of 06/30/19. Out of 47, 4- and 5-star rated Columbia income-focused funds (Inst. shares), 7 received a 5-star Overall Rating and 21 received a 4-star Overall Rating. The Overall Morningstar Rating is derived from a weighted average of the performance figures associated with its 3-, 5- and 10-year (if applicable) Morningstar Rating metrics. Not all funds are available in all jurisdictions, to all investors, or through all firms.

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Working through generational differences can be challenging, but it's important when building a strong team and understanding your client base. Learn about each generation's strengths and how embracing generational diversity can help grow your business.

We observed marked deteriorations in our equity-related signals over August. One tweet from the president in favor of resolving trade disputes could send the market higher. Despite this possibility, the longer term data trends make us comfortable introducing an underweight. Treasury assets have provided important support for asset allocation portfolios during times of equity market stress. While we believe that it’s a poor time to significantly add duration given how much yields have already moved, it is a good time to maintain Treasury allocations and duration exposure to offset equity market volatility. Non-directional strategies — such as absolute return — present compelling opportunities. We think commodities will do well, based on idiosyncratic risks for commodity markets that are asymmetrically tilted to the upside.

Anwiti: What most people may notice immediately is that the return forecasts are lower. Six months ago, the S&P 500 5-year forecasted return was 6.3%, and that’s been cut to 5.9%. Returns are lower in fixed income as well. A significant driver of the fixed-income revisions was the change in the Fed’s stance on rates — the pivot from hiking to a much more accommodative view. Expectations for yields have come down and returns are lower.

FinTech is harnessing data and technology to redefine an individual or institutions unique financial needs, including those historically too difficult to reach or uneconomical to serve. This shift will profoundly alter what products and services will be available and when. It will challenge regulators and drive unexpected partnerships. It will engage every stakeholder, require cultural change and reward value creation.

 

This year,  leaders and innovators will focus on answering an important question, what does increased access in financial services look like? Join us to deep dive on the critical evolution underway in financial services and what it means to entrepreneurs, investors, institutions,  and importantly, the consumer.  

When it comes to saving for a college education, it's true that the earlier you start the better. But no matter where you fall in the savings process, you can gain the tools, knowledge and guidance to lead you down the right path.

529 plans offer many well-known benefits, including generous contribution limits, tax-deferred growth and tax-free distributions to fund qualified education expenses.

 

But the mechanics of 529 plan distributions can be confusing for account owners. These five tips may help investors avoid unintended tax consequences, and in some cases, even help account owners and beneficiaries take advantage of little-known tax benefits.

 

1. Many college expenses can be funded tax- and penalty-free — but not all.

Account owners can use earnings tax-free to pay for qualified education expenses at qualified institutions, including tuition, fees, books, computers and room and board. But using earnings for non-qualified expenses may result in taxation plus a 10% federal penalty. Knowing what isn’t considered qualified is critical.

The return to college in September can be filled with anticipation as students face new professors, classmates, sports, academics — and the realization that another year of tuition payments are due. There’s been a lot of talk about the spiraling costs of higher education in recent years. But despite the ability to charge higher and higher price tags for a degree, many institutions struggle to cope with increasing financial pressures.

Negative demographic trends, questionable values for higher priced schools and ballooning student debt are just a few of the pressures facing colleges and universities in the U.S. Most of the sector is likely to see these negative forces play out over years, giving them time to adjust to new realities. But for some, the reckoning may be closer than investors anticipate. For these institutions — mainly smaller, less-selective, private liberal arts colleges with under 2,000 students — the challenges will be more imminent and may result in...

Central banks have been pivoting toward easier policy — a theme that’s been dominating bond market performance in 2019. In particular, the Federal Reserve has signaled potential interest rate cuts, marking a meaningful shift compared with the hiking cycle of the past three years. This has been a driving force behind double-digit returns in many bond market sectors in the first half of the year.

 

* In U.S. dollars as of June 30, 2019. Source: Ameriprise Q2 Earnings Release. Contact us for more current information. © Morningstar as of 06/30/19. Out of 47, 4- and 5-star rated Columbia income-focused funds (Inst. shares), 7 received a 5-star Overall Rating and 21 received a 4-star Overall Rating. The Overall Morningstar Rating is derived from a weighted average of the performance figures associated with its 3-, 5- and 10-year (if applicable) Morningstar Rating metrics. Not all funds are available in all jurisdictions, to all investors, or through all firms.

We read all day, every day, but the idea of carving out time in the summer to indulge in prose beyond email, text and IM is a hallowed tradition. In the 19th century, the advent of railroads and steamships made “getting away” more widely accessible, and the sweaty populace of industrializing cities headed for the beach — with books, magazines and broadsheets. A short 175 years later, we have a fully loaded Kindle. We recently asked some of our colleagues to recommend books for the beach or backyard during peak vacation season.

 

Gene Tannuzzo, Deputy Global Head of Fixed Income, Senior Portfolio Manager

Big Mistakes: The Best Investors and Their Worst Investments by Michael Batnick. It’s a good reminder to stay humble. It also teaches us that good research pays off in the long run — not always every day with every investment.

 

The recent escalation of a trade war with China has increased the risk of a U.S. recession. On August 1, President Trump proposed 10% tariffs on nearly all the remaining $300 billion of imports from China effective September 1. (Since then, he has postponed a sizeable portion of consumer goods tariffs to December 15.) These would be in addition to the $250 billion in goods that already face 25% tariffs. Markets reacted negatively, expecting a hit to growth and earnings. Long duration bonds rallied and various yield curves either flattened or went deeper into inversion. Even before the trade wars, equities had sold off following a confusing August Federal Open Market Commitee press conference in which Fed Chair Jerome Powell had struggled to communicate its decision to cut rates.

In late May, trade talks between the U.S. and China ended abruptly. The U.S. raised the tariff rate on $200 billion of imports from China from 10% to 25% and raised the prospect of additional 25% tariffs on remaining imports of about $300 billion. In addition to China, there remains a risk of Section 232 auto tariffs on imports from Europe and Japan. And most recently, trade policy risks were ratcheted up a notch with the threat of tariffs used as an economic weapon in discussions over immigration policy with Mexico. 

With the passage of time, it’s now possible to assess the impact of the tariffs already in place. New academic studies have used data on import volumes, U.S. import prices, U.S. producer prices and U.S. consumer prices to conclude that:

Anwiti: What most people may notice immediately is that the return forecasts are lower. Six months ago, the S&P 500 5-year forecasted return was 6.3%, and that’s been cut to 5.9%. Returns are lower in fixed income as well. A significant driver of the fixed-income revisions was the change in the Fed’s stance on rates — the pivot from hiking to a much more accommodative view. Expectations for yields have come down and returns are lower.