Accountable Update

Another Groundhog Day, Another Market High?

Last year was an amazing time to be invested in stocks. The S&P 500 Index recorded 62 new closing highs in a year that only had one down month (April). 2018 has felt a little like Groundhog Day, well not THE Groundhog Day (today), but more like the 1993 Bill Murray movie. In the film, Murray's character awoke each morning to relive the same day. So far, the S&P 500 has recreated setting a new record high 15 times before peaking last Friday. 

With market records seemingly being set every day, I’m increasingly asked if the winning streak means negative returns for stocks are on the horizon? Maybe so, but if you had gone to cash every time the market hit a new high last year, you would have left a lot of meat on the bone.

When addressing this question, it can be helpful to keep the following in mind:

Thinking About Market Timing? Forget It!

Sometimes, lessons on investing come from the most unexpected places. Maybe you saw the news this week that rap artist 50 Cent came into a “Bit” of a windfall. According to a Wednesday article by TMZ, one of the payment methods the artist accepted for his 2014 album, Animal Ambition,was Bitcoin. At the time, one of the crypto coins was worth between $650 - $700, and the rapper took in about 700 of them in sales.

Fast forward to today, with each Bitcoin worth $10,000, er, $12,000, uh, $11,000…oh, you get the point, and his stash is now worth somewhere around $8,000,000. Thus, leading to what is sure to become one of the most famous investing quotes of all time, “Ima keep it real, I forgot I did that $#!+, lol.”

Roth IRA Tips, Back Doors, and Key

It seems that all we have been doing for the past few months is talking about taxes. The Tax Reform & Job Act did, in fact, give us much to talk about. At one point, it appeared that the bill was going to do away, or significantly reduce, pre-tax savings opportunities currently available to eligible retirement plan participants.

The talk was that after-tax contributions would largely replace pre-tax contributions in 401(k)s, 403(b)s, and other defined contribution plans. In other words, they would have forced everyone into Roth IRA type of arrangements, where you don’t get the near-term incentive of saving on taxes, but the earnings would be tax-free. Fortunately, taxpayers retained the incentives and flexibility to decide for ourselves between pre-tax accounts that defer income taxes or post-tax alternatives that grow tax-free. With both alternatives still available, a common question remains.

Should I do a Roth IRA?

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