Our Thoughts

FJY News to Know #6

Aw, Look…They’re Playing Nice

With world leaders and policy-makers alike playing not-so-nice in the legislative schoolyard in recent years, 5 key risks that have improved can leave the rest of us breathing a little easier. And yet still holding our breaths a little, of course.

For investors, The market doesn’t like uncertainty, so it’s good to see signs of stabilization across the world begin to show over the past few weeks, suggesting policy-makers are making positive moves:

  • The US government is back in action, at least for the next week.
  • Conversations with China are in motion.
  • The Fed is evaluating and evolving its balance-sheet strategy
  • Brexit: Take Two
  • Italy is bouncing back & shows signs of stabilization

From Fed policy to government workers returning to work to international developments, read more to gain a better grasp of the economic outlook.

Good News, Bad News? The Fed Didn’t Raise Interest Rates

This is one of those 50/50, depending on how you look at it situations. On the one hand, it’s good news for borrowers, but somewhat bad news for savers. The Fed’s choice not to raise interest rates in January could mean marginally more money in the bank for consumers. The Fed also dropped its pledge of ‘further gradual’ rate hikes and may wind down its balance-sheet runoff. This is an indication it’s willing to adjust the size of its balance-sheet runoff, and perhaps end it altogether. This is all occurring amid Wall Street worries that it contributed to the huge stock-market selloff in December.

In a 10-0 vote, senior Fed officials left a key U.S. interest rate unchanged after a two-day meeting in Washington. The current level of interest rates is “appropriate for the state of the economy,” Jerome Powell, Federal Reserve Chairman, said in a press conference afterward.


Now, THIS is news we really love to share. The tax reform and the tight labor market are increasing the employer matching contributions for their employees. This means more money into your retirement plan from your employer!

The corporate benefits of the tax reform showed, as increased profits allowed companies to offer employees pay increases, higher bonuses, and increased employer match amounts. It helped drive after-tax corporate profits to their highest-ever level in the third quarter, according to Federal Reserve data.

If you haven’t done so, reviewing and maximizing your employer-provided benefits is a cornerstone of a person’s financial plan. Make sure you aren’t leaving money (and other benefits!) on the table!

Do you suffer from “resulting”?

This is the concept of confusing “the results of a decision to be completely linked to the decision-making process that went in”. Basically, a positive outcome can lead to overconfidence bias and that can lead to more risk-taking. If you take more and more risks, then the odds of one of those risks causing harm is greater. Apply this idea to investing: When you choose a DIY approach for your financial life, this can be detrimental and create a situation that’s even harder to rebound from.

Lack of savings, lack of needed insurance, lack of diversification, lack of big purchase planning – all of these are examples that can go very right or VERY wrong. Ask yourself these 5 questions to prudently plan and remember,

“Don’t beat yourself up over a less than ideal outcome, if you made the right choices for the right reasons.  Luck aside, good decisions and planning are the key components to maximizing your chances at financial success.”- Alan Ness, FJY Senior Financial Advisor

Someone Might Be Facebook Stalking You…and It Isn’t Your Ex 

This recent report is yet another reason to be careful about what you put on social media. New York’s top financial regulator is allowing life insurers to use social media data and other nontraditional sources when determining premium rates. Be sure to read the linked article for more specific do’s and don’ts for this topic, but here’s the gist: Some things can be good to post like nutrition focuses and fitness tracker data. Obvious no-nos are photos of bar hopping and smoking. Higher-risk sports can also be harmful or more expensive for insurability. How will this regulation impact insurability and rates? That’s still to be determined. We’ll have to keep our eye on this to see what happens in NY and implications for other states as a result of this.

We love writing about all things finance to help you learn more about how to achieve financial goals; both personally and with your business. Be sure to check out our blog page for an array of topics covering various aspects of finance, wealth management, and all things employer-sponsored retirement planning. FJY Financial specializes in Financial Planning, Investment Management, and Company Employee Retirement Plans, crafting the right strategy and plan for your specific needs. Contact us today to learn more!