4th Quarter Newsletter

Normally our quarterly newsletter is dedicated to investment related matters including market performance and news related to individual issues that may or may not be in your accounts. While important, your investments are only one facet of your total financial plan. For this issue of the newsletter, we would like you to think about the following in terms of your total financial plan.

1. Have you recently had a life changing event (marriage, divorce, childbirth, etc.) that warrants a new look at your current financial plan?

2. Are you on track for your retirement, college savings, or other savings/investing goals? When was the last time you updated these projections? Do you have well thought out, written goals for these objectives?

3. When was the last time you reviewed your life and/or disability insurance coverage? Is your current life insurance coverage adequate for your needs? Do you need to increase or decrease your coverage to reflect current needs? Is your current disability insurance in line with your current salary and needs should you become disabled?

4. Do you believe that, at some point in your life, you will require Long Term Care services (nursing home, home health care, etc.)? If so, what action have you taken to address this issue?

5. When was the last time you reviewed your wills, powers of attorney, and advanced healthcare directives? Do these documents meet your current needs? Are the Personal Representatives named in these documents aware of your wishes, and are those representatives still valid for your current situation?

6. Are the primary and contingent beneficiaries on your investment accounts, life insurance policies, and wills up to date? Do these beneficiary selections meet your current wishes as to the disposition of your assets upon your death?

If any of the above questions cause you concern, or if you would like to begin the discussion concerning any or all the above issues, please contact our office to set up an appointment. As financial planners and Chartered Financial Consultants®, we are invested in ensuring we address not only your investment portfolios, but also the areas listed above.

On another note, you all know that we have had some personnel changes at the firm this year. We appreciate your patience as we have worked to overcome these challenges. In July, we welcomed Lisa Bolduc to our administrative team.  Lisa brings a wealth of experience, ranging from Air Force service to non-profit work, and has already proven herself to be an invaluable asset to the Eagle Financial team. We are very glad she accepted our job offer!

Those of you who have positions in the private placement real estate investment trust sponsored by AR Global will see a reduction in your quarterly bill. This is due to the fact that the redemption programs for these issues have been temporarily suspended. Once the companies resume their redemption cycles, we will begin billing on these positions again.

And finally, with the announcement that Equifax, one of the “big three” American credit bureaus, suffered a serious cyber-security breach recently we want to ensure our clients that keeping your personal identifying information secure is a top priority for our firm. While we feel that we’re taking proper steps in our firm’s security measures, we’re encouraging our clients and their family members to also take steps to help protect their identity and reduce potential security risks. We invite you to visit our website and view our Reducing the Risk of Cyber-Security Threats blog post.

We greatly appreciate your continued trust in Eagle Financial Strategies. From all of us here, we hope you have a great fall.

Very Respectfully Submitted,

Park O. Johnson III                                           Andrew W. Shuman

1st Quarter 2017 Newsletter

Happy New Year from the crew at Eagle Financial Strategies! We hope you had a great holiday season.

Following please find some items of interest as we go into 2017.

For those of you who still have Master Limited Partnerships in your account, please be aware that you will receive a Form K-1 to file with your tax return. From past experience, many of these K-1s are not issued until the end of March. If you have any questions concerning whether or not you will be receiving a K-1, please email or call us.

We have done a full review of our models and selected investments. You will most likely see some activity in your accounts over the next few weeks as we realign your portfolios with the new models, swapping out selected investments for the new ones.

We expect some turbulence in the market going forward. The “Trump Rally” thus far has been based solely on analysts’ thoughts on “what might happen”. No one knows for sure. While President-Elect Trump has made some clear indications as to what he would like to do, he still needs a cooperative Congress and Supreme Court to fully execute his vision.

Interest rates should head higher throughout the year. The Fed has telegraphed the possibility of three rate increases during 2017. This will cause some volatility in the fixed income markets if the rate increases should materialize.

As far as to our thoughts on the market’s overall reaction, our crystal ball is still broken (I know, we need to get a new crystal ball repair man-we are open to suggestions). As always, we believe that staying the course and executing a properly developed investment plan based upon your individual risk tolerance is the proper action. Almost all of the accounts we manage are set up to be long-term investment programs. Therefore, it makes no sense to make short-term adjustments that could potentially harm the program over the long-term. An interesting study supports our belief that staying invested and not trying to time the market, even in poor market conditions, is the way to go.

According to the 9/5/2016 edition of BTN Research, the total return of the S&P 500 from 2011 through 2015 was 80.7%. The best 13 trading days in that five-year period (out of 1,258 total trading days) accounted for 55.1% of the 80.7% gain. Put another way, approximately 1% of the trading days over the five-year period accounted for approximately 68% of the total five year gain. If one had been trying to time the market by moving in and out in response to external factors, they stood a very good chance of missing the biggest gains from 2011 through 2015. (These figures represent past performance only, and cannot be used to predict future performance.)

This does not preclude a speculative investment once in a while (though only if it is indicated by your risk tolerance), but does lend credence to our belief that remaining invested over the long-term, adding to investments (especially in down markets), and reinvesting dividends and interest back into the account is the proper way to execute a long-term investment program.

We wish you all a Happy, Healthy, and Prosperous New Year.

Let’s Be Careful Out There…

This is just a quick note of caution to all of our readers. More of a “blurb” than a “blog”.

As investment advisors, we often have a front row seat to people’s financial mistakes. One of the biggest mistakes people make is believing an unscrupulous advisor that guarantees investment returns.

By law, investment advisors are NOT allowed to guarantee investment returns.

If you are approached by someone who states that they can triple your money, guarantee an XX% rate of return on your money, or makes a claim guaranteeing you to never lose your money, kindly show that person the door. The only money they are tripling is most likely their own, through gaining access to yours.

In our roles as life insurance agents, we often show people illustrations showing a guaranteed interest rate on a policy or annuity. This cannot be mistaken for the same type of guarantee that is mentioned above as they are contractual promises from the company providing the policy. The company has a financial interest in seeing that they honor their guarantees. You, as a consumer of the product, still need to be aware that those guarantees are only as strong as the company behind it. Therefore, is it truly a guarantee? By the strictest definition of the word, I would say no.

Bottom line. Nothing in the financial world is truly guaranteed, even the interest on government bonds that are backed by the “full faith and credit of the U.S. government” (don’t even get me started…). Fall back on the old saying that if it seems too good to be true, it probably is.