Monday, February 12, 2018

Retirement Data: Fidelity Plan Balances Average Six Figures at End of Q4 2017


Please click on the above chart to enlarge. From Fidelity's press release:
  • IRA and 401(k) accounts continue to hit record levels. Increasing contributions and a strong stock market drove both the average 401(k) and IRA balances over six figures. The average 401(k) balance rose to $104,300, 13 percent higher than Q4 2016. The average IRA balance climbed to $106,000, which is also a 13 percent year-over-year increase. 

Saturday, February 3, 2018

February Market Update - Volatility Returns

The S&P 500 was up 5.62% in January. When we examine global securities via the Morgan Stanley Capital International All Country World Index (MSCI ACWI, iShares ETF ACWI), which represents 85% of the global investable equity market, it has been up a record 15 months in a row. After a surge in the stock market to start 2018, the S&P 500 finally experienced a 3% or greater correction (during the week on January 29-February 2). The last time investors encountered such weakness requires us to travel back in time to November 4, 2016, right before the U.S. Presidential election. Let's review price, sentiment and valuation as we enter February.

Friday, January 5, 2018

January 2018 Market Update - Bulls Rejoice

The S&P 500 was up 0.98% in December. When we examine global securities via the Morgan Stanley Capital International All Country World Index (MSCI ACWI, iShares ETF ACWI), which represents 85% of the global investable equity market, it has been up a record 14 months in a row. The main story about the market in 2017 is the total lack of volatility. The S&P 500 has not had a 3% or greater correction since November 4, 2016. Let's review price, sentiment and valuation as we start 2018.

Wednesday, December 6, 2017

December 2017 Market Update

The S&P 500 was up 2.81% in November. When we examine global securities via the Morgan Stanley Capital International All Country World Index (MSCI ACWI, iShares ETF ACWI), which represents 85% of the global investable equity market, it has been up a record 13 months in a row (the old record was 10 months). This month we'll learn if a U.S. government shutdown will end the MSCI's monthly growth streak in 2017; I'm hopeful the spending bill is extended. Let's review price, sentiment and valuation as we start December.

Friday, November 10, 2017

Retirement Data: Fidelity Plan Balances Q3 2017


Please click on the above chart to enlarge. From Fidelity's press release:
  • "Retirement account balances reached all-time highs for the fourth consecutive quarter. Helped by strong stock market performance, the average 401(k) and IRA balances increased 10 percent over the last year and continued to hit record levels. The average 401(k) balance rose to $99,900, while the average IRA balance climbed to $103,500."  

  • "While the average 401(k) and IRA balance increased for every generation (Boomers, Gen X and Millennials) over the last year, significant growth was seen among Gen X investors. The average IRA balance for Gen X investors increased 16.5 percent to $51,500, and the average Gen X 401(k) balance increased 18 percent to $98,800." 

Monday, November 6, 2017

November 2017 Market Update

The S&P 500 was up 2.22% in October. When we examine global securities via the Morgan Stanley Capital International All Country World Index (MSCI ACWI, iShares ETF ACWI), which represents 85% of the global investable equity market, it has been up a record 12 months in a row. Investors must consider whether or not the strength of stocks can continue and ponder if low volatility can remain. Furthermore, we've made it to November escaping the seasonally risky months of August, September and October without any stock market corrections. With positive corporate earnings, the past two months saw the S&P 500 advance more than 4%. With that background, let's review price, sentiment and valuation as we start November.

Tuesday, October 17, 2017

Retirement Data: Boston College Center for Retirement Research IRA/401k Analysis

The Center for Retirement Research at Boston College is out with a new report titled 401(K)/IRA Holdings In 2016: An Update From The Federal Reserve’s 2016 Survey of Consumer Finances (SCF) by Alicia H. Munnell and Anqi Chen.

The overall report shows some encouraging trends, however it's disturbing to read the extent of the challenges younger and lower paid workers have accessing defined contribution plans and saving for retirement. The report highlights that the financial services industry working with municipal, state and federal governments need to create more options so fewer working age adults miss out on saving for retirement. Below are two graphics from the report that stood out to me. The first one shows how little the median household has saved for retirement. The second one shows the disparity between high income folks and low income folks nearing retirement. Notice the median household has $780,000 in the top quintile by income compared to $26,700 for the lowest quintile by income.