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The Cox Connection

Vol 4 Issue 1 ||JANUARY 2021

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CAPITAL MARKET UPDATE

Market Performance as of 12/31/20

  • S&P 500 TR: QTD 12.15% and YTD 18.40%
  • Dow Jones Industrial Average TR: QTD 10.73% and YTD 9.72%
  • MSCI EAFE (International Stocks): QTD 16.05% and YTD 7.82%
  • MSCI Emerging Markets: QTD 19.70% and YTD 18.31%
  • Bloomberg Barclays US Aggregate Bond: QTD 0.67% and YTD 7.51%
  • Bloomberg Barclays Global Aggregate Bond: QTD 0.89% and YTD 5.58%

Happy New Year! We turn the page on another year thinking about what we have learned and how to apply that to our future. We have learned, time and time again, that to be resilient you must have faith. Faith in your God, faith in your process, and faith in the people with whom you surround yourself. Without faith you will constantly question your future and what "could" be. You will constantly feel like you should be doing something else and always compare yourself to others. There comes a time after reviewing, preparing, and testing various scenarios that you must let go and have faith.

We feel strongly that a long-term strategy should continue to be your focus; even if you are retired or retiring. Year 2020 market results were a pleasant surprise to most. We did expect the economic slow down related to the pandemic but expressed to you that we fully anticipated the capital markets to bounce back as they did and have done in the past. We waited patiently for the market results following the Presidential election and have been pleasantly surprised at the year end results; S&P 500 up more than 18% and the Aggregate U.S. Bond Index up more than 7%. We have seen impressive results not just in the U.S. but across the globe as businesses figure out how to adjust to a new way of operating and serving its customers.

Going forward we will continue to monitor bond yields in our portfolios. We expect them to remain low, given the current monetary policy. We expect to see prices of goods and services to rise as the economic recovery continues. This will all continue to help the equity markets in the next couple of years. We expect foreign investment opportunities to play out similarly.

Over the last few weeks U.S. political tensions continue to rise, but with little impact on the capital markets. We are cautiously optimistic about the coming months as well. We watch the news with interest but feel very confident that our country will pull through stronger. You and the people in our everyday lives give us faith in our future as they demonstrate that the majority of the U.S. is made of great people who work hard everyday and who will look out for one another. Continue to work hard and take care of one another, and most importantly have FAITH!

Source: Total returns of the indices mentioned are provided by Morningstar, MSCI, and S&P Dow Jones. None of these firms nor their Information Providers can guarantee the accuracy, completeness, timeliness, or correct sequencing of any of the information on their websites, including, but not limited to information originated by them, licensed by them from information providers, or gathered by them from publicly available sources. There may be delays, omissions, or inaccuracies in the information. Past returns are no indication of future results.

RETIREMENT INSIGHTS

Principles of Preserving Wealth

There are some fundamental estate management principles that can enable you to manage your financial and personal affairs during your lifetime and distribute your wealth after death. We encourage you to talk to an estate planning attorney for more details on each of the following documents you should have:

  • Living Will - gives instructions about your medical care
  • Power of Attorney - authorizes someone to handle legal and financial decisions on your behalf
  • Durable Power of Attorney for Healthcare - allows

Contemporary research shows that about 70% of older Americans complete advance directives before their death. That's up from 30% only a decade ago.

There are also some financial documents to consider:

  • Joint Ownership - holding an asset in joint ownership with a co-owner allows you to pass on the asset without probate
  • Durable Power of Attorney - gives someone the ability to handle legal and financial decisions even if you cannot.
  • Living Trust - transfers assets to heirs without probate

With extended life expectancy and a variety of treatment options available, the chance that you or someone close to you will benefit from an advance directive is greater than ever.

One more additional item to discuss with your attorney and accountant are gift taxes. The tax code allows an individual to gift up to $15,000 per person in 2021 without triggering any gift or estate taxes.

Read our full article, here. Please call us if you have any questions or would like to review your situation, 281-395-8300.

2021 Retirement Savings

401(k)s

The salary deferral amount for 401(k)s remains the same at $19,500, while the catch-up amount of $6,500 for age 50 and over also remains unchanged. However, the overall limit for these plans will increase from $57,000 to $58,000 in 2021.

Individual Retirement Accounts (IRA)

The limit on annual contributions remains at $6,000 for 2021, and the catch-up contribution limit for age 50+ is also unchanged at $1,000.

Roth IRA

Roth IRA account holders will experience some beneficial changes. In 2021, the Adjusted Gross Income (AGI) phase-out range will be $198,000 to $208,000 for couples filing jointly. This will be an increase from the 2020 range of $196,000 to $206,000. For those who file as single or as head of household, the income phase-out range has also increased. The new range for 2021 will be $125,000 to $140,000, up from the current range of $124,000 to $139,000.3

If you’re curious about any of the above, or want to update or begin contributions to a retirement account, give us a call.

Source: IRS.gov

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Cox Global Associates, Inc. || 1260 Pin Oak Road, Suite 204 || Katy, TX 77494 || 281.395.8300 https://www.coxglobalassociates.com/ || info@coxglobalassociates.com

Securities and Advisory Services are offered through Geneos Wealth Management, Inc. FINRA, SIPC. Investment advisory services also offered through Cox Global Associates, Inc., A Registered Investment Advisor.

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. "Principles of Preserving Wealth" was developed and produced by FMG Suite to provide information on a topic that may be of interest. FMG Suite is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.