Whether you have plans to retire early or simply want to retire comfortably, it's important to set realistic expectations and then make a plan to achieve them. We'll help you learn some of the right questions to consider, and we'll do our best to help you work toward the right answers.

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.

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.

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.

 

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.

 

We all use instincts for decision-making and even survival. But gut reactions can hurt your clients' investments. Learn more about these behaviors and biases and why many people are prone to them. More importantly, get tips on how you can help prevent your clients from making costly, emotional decisions.