A Message for You

October 2020

Don’t Invest Based on a Single Story

By Wayne Park | 5 - 10 minutes

A message from American Century Investments Wayne Park, Senior Vice President, Personal Financial Solutions

Election decisions based on one candidate or policy may not provide the results you expect—rarely are issues settled soon after all the votes are in. Investing decisions on a single event, such as an election or a market reaction, may not give the desired results either. You could succumb to what novelist Chimamanda Adichie calls the “danger of a single story” and miss the bigger picture.*

When you consider a collection of stories and experiences, it can help you make more informed decisions. It’s how we manage your money. I believe it’s a good approach for you too.

Find out why our investment professionals make decisions based on process over politics.

     

Read Now

Add to Your Collection

How do you look beyond single stories that market and news headlines tell us nearly every day? Take a page from our investment professionals’ playbook: They make decisions objectively (based on data), systematically (following repeatable processes) and in a disciplined way (true to their objectives). Here are my thoughts on how you can do the same with your investments.

  • Stay Objective – Ignore the emotions of today’s turmoil and keep focused on your long-term goals. There will always be uncertainty, but history shows that long-term investing can have rewards.**
  • Make It Systematic – Keep investing even through the trying times. Investing regularly helps you keep your long-term goals a priority.
  • Practice Discipline – This has to do with your investment plan. Have a mix of different investments—known as diversification—to help balance your portfolio through market ups and downs. Then, stick with it no matter what stories you may hear, but remember to reevaluate periodically to ensure you're on track.

Let Us Help Unravel the Plot

Sometimes it’s hard to know which stories to pay attention to. That’s where we can help with both how we actively manage your investments and our commitment to help you reach your goals. Our consultants are here to evaluate if your plan fits, so you don’t have to be swayed by a single story. Don’t hesitate to call us if you need help.

Best Regards,

Did you miss the previous message?

Click the month to read previous articles from Wayne Park. 

Different Season, Same Principles Apply

October 2, 2020

Normally this is the time of year when people start looking forward to the holidays. In fact, the shopping countdown has already begun. (If you’re keeping count, it’s less than 90 days!) Like everything else we’ve experienced in 2020, this upcoming season will likely not be the same. Even when everything is different, there are principles that don’t change.

What Does the Last Part of 2020 Have in Store?

Read our investment professionals’ outlook for the fourth quarter.

A Different Season

Some predict a disappointing holiday season due to the pandemic. Even the fate of trick-or-treating hangs in the balance. The continued fallout will certainly impact many families in varying degrees and possibly yours too. Remember, we’re here if you have questions or need help with your finances.

In a normal season, we’d talk about not overspending and sticking to your budget. It’s still a smart plan for your cash, whether you celebrate the same or not. For your investments, there are principles that apply through all seasons.

Principles Are Always in Season

Smart investing principles are never out of season. It’s true when markets go up and when they go down. It’s especially true in times of uncertainty. Below are three principles for the top of your list.

  1. Practice proper asset allocation – The appropriate percentage of stocks, bonds and money markets can help balance your portfolio and aims for a risk level that fits you. This balance may help your investments withstand a variety of market conditions. And having several investment types is designed to offset losses in one area with potential gains in another.
  2. Stick with it – As important as asset allocation is, it may not help if you knock your portfolio off balance. Some investors may be tempted to sell stocks and bonds, moving their funds to a money market in an effort to avoid losses and “play it safe.” Taking such actions may come with “opportunity costs.” It’s important to consider how much growth (opportunity) you might miss out on in a potential market rebound.
  3. Match actions to you – Don’t get me wrong, money markets play an important role in a portfolio. The question is how much you need. Depending on how soon you need the money, a higher percentage may be the right choice. My point is that whatever actions you take need to match your goals and timeline.

LEARN MORE ABOUT THESE PRINCIPLES AND HOW YOUR ACTIONS CAN IMPACT YOUR INVESTMENTS.

Read Trading One Risk for Another? Find the Right Balance.

Read Now

Different Season, Same Promise

Another thing that hasn’t changed is our commitment to you. We’re still in the business of hope for the future and for your success. 

Diversification does not assure a profit nor does it protect against loss of principal.

Generally, as interest rates rise, the value of the securities held in the fund will decline. The opposite is true when interest rates decline.

Who Wants to Hear a Scary Story? Not Me!

October 9, 2020

There have been plenty of frights for investors this year—the pandemic, market volatility, economic news, political uncertainty and more. We’ve covered them frequently over the past several weeks. Now I want to turn to some practical ways to help manage two things that people can get the jitters about: Taxes and protecting your personal information. Both can be scary topics, but there are ways to alleviate their threats.

Bust Tax-Time Fears

Tax time can be an investor’s—really anyone’s—least favorite time of year, especially when figuring out if you owe taxes. Did you have a gain or a loss? Did your fund pay dividends? Then there’s the sometimes-complex task of figuring your cost basis—used to calculate gains or losses based on the price you originally purchased a security or share. Some may dread the paperwork. Others just get nervous when it comes to anything dealing with taxes.

Why am I talking about taxes in October? There are things you can do—even starting now—to make tax time less frightening next April. A few have a December 31 deadline so I’m bringing them to your attention now. And yes, it also goes with my spooky Halloween theme, but that’s not the main point. Read the article below for nine tax items that you can start thinking about now.

Forget the Ghosts: 9 Ways to Bust Tax Time Specters

     

Read Now

 

Thwart Identity Tricksters

Identity theft has been a threat for a while. Unfortunately, the pandemic has not slowed down scams, or people’s fears. According to a recent Transunion study, 83% of people are worried about having their identities stolen and stress over it has risen 32% during COVID-19. Even more scary,10% of U.S. adults became victims of the crime during this time.*

Here at American Century Investments, we take seriously your private information and the security of your money. Along with the precautions we take, we also know that protecting your identity requires a partnership between us and you. There are things you can do both online and offline. Read the article below to get our latest tips on protecting your information. 

Find out what you can do to help safeguard your private information and your money.

Read Protect Your Data — and Your Dollars

Handle the Tricks, Enjoy the Treats

After what we’ve experienced so far in 2020, I think we could all use a break for the rest of the year. Will we get it? Who knows, but I encourage you to take advantage of our tax-time tips and learn ways to help protect your identity. Acting now may allow you to treat yourself to less stress in the coming months.

If you need help with your investments, remember we're here for you. You can still speak to a real person when you need to. Please don’t hesitate to call us. As always, thanks for your confidence in us.

*COVID-19’s Impact on Online Government Services, Transunion, August 2020.

IRS Circular 230 Disclosure: American Century Companies, Inc. and its affiliates do not provide tax advice. Accordingly, any discussion of U.S. tax matters contained herein (including any attachments) is not intended or written to be used, and cannot be used, in connection with the promotion, marketing or recommendation by anyone unaffiliated with American Century Companies, Inc. of any of the matters addressed herein or for the purpose of avoiding U.S. tax-related penalties.

This information is for educational purposes only and is not intended as tax advice. Please consult your tax advisor for more detailed information or for advice regarding your individual situation.

Investment return and principal value of security investments will fluctuate. The value at the time of redemption may be more or less than the original cost. Past performance is no guarantee of future results.

Beyond Who’s President, There’s SALT

October 16, 2020

As we count down to the November elections, many people focus on who will be president for the next four years. Presidents may help decide the direction of the country, but for your personal finances, you may want to look closer to home. Local races may have more impact because of SALT (state and local taxes).

The President and the Stock Market

Presidential elections can definitely impact the markets—especially leading up to election day. The oftentimes-charged season can result in uncertainty, and that can be unnerving to investors. In fact, in one of our recent surveys, 32% of clients said that the election was their single biggest investment concern, followed by market volatility and the pandemic.

But after an election, the individual and party winners don’t seem to matter much to the markets, if history is a guide. Still, the results may have a role in policy decisions and affect certain industries. Read our take on some of the potential outcomes.

Global Markets at a Crossroads

     

Read Now

Don’t Pass On the SALT

State and local taxes may actually have more of an influence on you than who lives in the White House. From schools to water service to roads, local governments play a big role in quality of life. And because they are typically smaller elections—with lower turnouts—your voice may count even more.

You’ll also see impacts on your money. Local governments impose property taxes and sales tax on what you purchase and consume. That can affect you and your family’s discretionary income and the amount you can invest for the future.

Be Heard and Stay Calm

Voting is a privilege we should all exercise—for all levels of government. I encourage you to also stay strong in your investment plan, particularly if you’re watching the markets react leading up to Election Day. In the next few weeks, be sure to watch your inbox for more perspective about elections and the markets.

In the meantime, remember that volatility is normal—even in this everything-but-normal year and election process. Our Volatile Markets? Kick Up Your Financial Knowledge article may help give you some perspective.

Also, if you’re wondering about your investment plan, remember we’re here for you. Please don’t hesitate to call us.

IRS Circular 230 Disclosure: American Century Companies, Inc. and its affiliates do not provide tax advice. Accordingly, any discussion of U.S. tax matters contained herein (including any attachments) is not intended or written to be used, and cannot be used, in connection with the promotion, marketing or recommendation by anyone unaffiliated with American Century Companies, Inc. of any of the matters addressed herein or for the purpose of avoiding U.S. tax-related penalties.

This information is for educational purposes only and is not intended as tax advice. Please consult your tax advisor for more detailed information or for advice regarding your individual situation.

Your Investments in “This Normal”

September 4, 2020

While many are accepting life with the pandemic—rather than wondering when we’ll resume normal—one thing we’re not quite used to are stock market movements. Many were shocked by the drops earlier this year and the recent market highs have left some wary. When markets experience dramatic movements, it may be a good time to stick with active investments. Let’s explore why.

Get our perspective

 on what’s happening with the stock market and possible recovery scenarios in our latest article: The Disconnect: Pandemic vs. Market.

Read Now

The Market Reflects Our Normal

If this were 12 months ago, few of us would blink if markets were hitting records. We had grown accustomed to the markets going up—at least most of the time. Today it’s different. The makeup of the market also tells a different story from what we knew just nine months ago.

Looking at the so-called “COVID-19 winners,” you see some stocks that were excelling before. The FAANG—Facebook, Amazon, Apple, Netflix and Google—stocks were doing well prior to the pandemic. As technology companies, their products also fit nicely into our new way of living.

However, that's not to say that the winners will always continue breaking records—as we saw this week. And other companies might be considered COVID losers because they have not rebounded at all. The market makeup is different from what we knew and it's not likely going back. It's a different economy.

Should You Change How You Invest?

If you’re confident that your investment plan still fits your long-term goals, the answer is no. If not, or you made sudden moves when the markets got rough, it might be time to evaluate. I believe the best place to be is in a diversified portfolio that fits your situation. However, given this different economy and new environment, now may be a good time to evaluate actively managed investments versus index or passive ones.

Active Investments in Volatile Times

Both active and index funds can have a place in your portfolio—it’s usually not an either-or choice. However, for volatile times, there may be some advantages to relying on the expertise and experience of an active portfolio manager.

Active managers can look below the surface of a company’s performance to see if its financials match what’s happening with the stock. They can also take advantage of opportunities or back away from risky prospects more quickly. The ability to pivot may be especially important during times of big market swings or uncertainty. Index funds don’t have the same luxury.

Are You Confident in Your Plan?

As important as the makeup of your portfolio is, it’s also important that you feel prepared for whatever comes next. If you need help evaluating your portfolio, you’re in the right place. A free portfolio review is available upon request. Just call us.

As always, thanks for your continued confidence in us.

Investment return and principal value of security investments will fluctuate. The value at the time of redemption may be more or less than the original cost. Past performance is no guarantee of future results.

Diversification does not assure a profit nor does it protect against loss of principal.

References to specific securities are for illustrative purposes only, and are not intended as recommendations to purchase or sell securities. Opinions and estimates offered constitute our judgment and, along with other portfolio data, are subject to change without notice.

Going the Distance

September 11, 2020

There’s not much most of us wouldn’t do for a loved one. Sometimes we care for a parent or someone else who can’t do it alone. The physical and mental strain can be difficult—especially if you don’t live close. But you go the distance no matter what. That same principle applies to investing, too.

Are You Caring for Someone From a Distance?

Get practical help about how to set up a long-distance care plan.

Read Now

Caregiving: Pace Yourself

Dedicating your time and energy—and likely your money—caring for a loved one is not easy. It’s even harder when you don’t live nearby. I’ve experienced it myself, including the urgency of wanting to be there. One piece of advice: Don’t burn yourself out.

Instead, go step by step and enlist the aid of others. The last thing you need is to have your own health or finances suffer. Think of it as providing steady care rather than racing to do everything all at once. That’s actually a good idea for your investments as well.

Find Your Stride

Long-distance runners pace themselves so they can cross the finish line. With investing, setting your stride starts with an investment plan that is your “speed”—one that considers when you need the money and how much risk you can tolerate. What does not work are “sprints” or “detours.”

  • The sprint is attempting to reach the finish line with highly aggressive investments—usually to make up for a lack of savings or losses. It can be too risky, especially with uncertain markets.
  • The detour is side-stepping a solid plan by jumping out of the market to avoid losses or jumping in to capitalize on gains. Market timing can be detrimental to your goals.

Take Your Time

We believe time in the market is superior to trying to time it. Staying invested lets you take advantage of compounding—making money on your original investment as well as on the earnings. Also, when you’re already invested, you won’t miss a potential market spurt.

How Can We Help?

When caring for a loved one, remember to care for yourself and your own finances—pace yourself. Do the same with your investments. In either situation, we’re here for the financial side. If you need help, please call us.

Thanks for putting your confidence in us to manage your money.

Best Regards.

Investment return and principal value of security investments will fluctuate. The value at the time of redemption may be more or less than the original cost. Past performance is no guarantee of future results.

What’s Your (Investing) Type?

September 18, 2020

People have different relationships with their investments—just like they have different connections with people. Some believe it has to do with your investing personality. It’s an interesting concept and one that may give insight into how you make decisions.

Your Investing Personality

Your relationship with your investments is likely linked to your family’s view of money and your own experiences. Psychologists and behavioral finance professionals say it also involves your personality, which they classify into different types based on research.

Let’s review those developed by Jonathan Myers,* an industrial psychologist who believes your investing personality doesn’t change much under different circumstances. Based on that premise, events such as COVID-19 would not have much impact on how you handle investing decisions.

Professional Money Managers Use Multiple Traits

Our experts use research, data analysis, experience to manage money. Get a sense of how they do it in our latest article: Fundamental vs. Quantitative Investing: Same Goal, Different Process

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Do You See Yourself in Any of These?

  • Cautious Investors don’t like risk or losing money. They usually make few portfolio changes and may be wary about financial advice, preferring to do their own research.
  • Emotional Investors follow the latest trends and make decisions on instinct. They may hold on to an investment—even if they shouldn’t—because they believe everything eventually works out.
  • Technical Investors follow the numbers when making investment decisions. Research and diligence are their mantras.
  • Busy Investors are aware of everything that’s happening with the markets and may make decisions based on what they hear. They check prices often and may buy and sell—a lot.
  • Casual Investors are busy with work and family, using a “set-it-and-forget-it” style. They rarely check on their finances, preferring to leave it to professionals who they may or may not be in contact with regularly.
  • Informed Investors use information from many sources and keep watch over their investments, markets and the economy. They listen to experts and are confident in their decisions—relying on knowledge and experience.

The Markets Speak—Should You Listen?

Some investors tune in daily to market feeds, economic news and government actions, such as the Federal Reserve meeting this week. Should you react? It may depend on your knowledge and how close you are to your goal—such as retirement. We can help with the big picture. Learn about the Fed’s monetary policy and how changes may affect you.

Work With Your Style

Knowing the personality type(s) that made you say, “That’s me!” may help. It can enable you to lean on your strengths and avoid potential pitfalls when making investing decisions.

All personalities are welcome here. It’s why we offer a variety of services for how people like to work with us. Whether you’re a DIYer, looking for occasional guidance or prefer to leave it to the professionals—we’re here for you. Don’t hesitate to call us.

*Myers, Jonathan. What Kind of Investor are You? www.codeinvesting.com , 2017.

Investment return and principal value of security investments will fluctuate. The value at the time of redemption may be more or less than the original cost. Past performance is no guarantee of future results.

Down the Home Stretch: Rein in Emotions

September 25, 2020

Whew! We made it to the fall and are nearing the final lap of the year. It’s still 2020, so that doesn’t mean we’re “home free.” What could possibly go wrong? From continued COVID-19 cases to economic uncertainty and a charged election period—there’s plenty to stir our emotions. Let me offer possible solutions for feelings about your finances.

Concerned About the Elections and Your Investments?

Get perspective in our latest article: Stocks Are the True Independents in This Election.

Read Now

 

Keep Blinders On (When Needed)

When emotions run high, I recommend tuning out distractions. The latest news can prompt undue worry, especially if your investment plan fits your goals. If you’re less confident, it may be time to revisit your plan.

Another way to tune out noise is to practice healthy financial habits. Stay invested and avoid knee-jerk financial decisions. It can have a negative impact on your goals.

Beat Money Stress With Healthy Habits

Read Financial Stress: The Link Between Health and Wealth

Refocus Your Emotions

What does an emotional decision look like? According to one psychologist, an emotional investor may follow the latest trends and make choices based on instinct.1 Emotions may drive you to:

  • Choose investments based on a gut reaction
  • Jump into a high-performing investment without much research
  • Hold on to a bad investment because you still hope for the best

Is there a place for emotions when investing? Money is one of the most personal things we deal with so it naturally evokes feelings. The solution may be to refocus them.

One way is to rein in your emotions for short-term decisions but use them to your advantage for long-term ones. Turn your ability to persevere into a commitment to a solid financial plan. And channel gut instincts into taking smart risks—ones that offer potential rewards—and aren’t merely popular trends.

Another way you can offset emotions is to set up convenient automatic investments. Automatic investing removes questions about when to invest and lets you take advantage of market swings. You buy more shares when prices are low and fewer shares when they are high.2

Keep Calm and Ask for Help

Whatever sparks your emotions, I hope you find peace in focusing on what’s important, including your future. And if you need help with the financial side, don’t hesitate to call us. Like everything else in 2020, we can get through the rest of this year together.

1

Myers, Jonathan. What Kind of Investor are You? www.codeinvesting.com, 2017.

2

Dollar cost averaging does not ensure a profit or protect against a loss in declining markets. This investment strategy involves continuous investment in securities, regardless of fluctuating price levels. An investor should consider his or her financial ability to continue purchases in periods of low or fluctuating price levels. 

Investment return and principal value of security investments will fluctuate. The value at the time of redemption may be more or less than the original cost. Past performance is no guarantee of future results.

Lose Out or Miss Out? A Strategy Can Help.

August 7, 2020

Many people have worries about money. These can lead to abandoning your investments during rocky markets or making decisions that may not pay off in the long run. The alternative is to follow a sound plan that can anchor your emotions.

FOMO vs. FOLO

Have you heard about FOMO—the fear of missing out? It’s the anxiety people have when they feel left out. And it’s not just for 20- and 30-somethings on social media. People with investing FOMO fear missing out on high performance. They may chase a hot investment one day only to sell later when it fizzles.

There’s also FOLO—the fear of losing out. Not as widely known as FOMO, I’m using FOLO to refer to the anxiety investors have about losing money. This can lead some to sell or move to cash investments at the first sign of a rocky market and stay there.

Is anxiety dictating your investment decisions?

A plan can help alleviate worries and put you on the path toward your goals.

Request a Call

Self-Fulfilling Choices

Worry can skew perceptions and lead to decisions that give the very results you don’t want. For example, in the first six months of 2020, the stock market experienced one of the worst drops in history, but also one of the highest gains. The average for that period is actually modest, but many did—and still do—only focus on the dramatic drops.

Those in the FOLO camp may have moved into a money market (or out of the markets) and missed the big loss, but also the big gain. Unfortunately, this could have resulted in locking in the losses and missing the rebound.

Succumbing to FOMO can play out as selling at a loss and later buying high—the opposite of what you want to do. This market timing can expose you to missing out on what you want: Some of the market’s best days. That’s why we advocate time in the market as a better strategy.

Opt for Strategic Decisions

The good news is that you can make investing decisions based on proven strategies instead of emotions. There are ways to strike a balance and avoid guessing what to do next, including practicing these:

  1. Balance Risk. An alternative to staying on the sidelines is to match your portfolio risk to your goals and timeline. Also, realize that the extremes of “low risk” and “all risk” are not the only answers for your portfolio.
  2. Diversify. Adding a mix of several different investments in your portfolio has long been hailed as a practice to manage loss. The idea is that when one investment performs badly, others may offset it by performing well.

Add Balance to Your Portfolio—Two Resources for You

Trading One Risk for Another? Find the Right Balance explains how low risk impacts your rewards. It also reviews choices to keep your money growing. Read now

The Surprising Truth About Diversification further breaks downs this important principle and sets the record straight on what it is and is not. Learn more

Let Us Help

Investing during uncertain times can feel scary, but I encourage you not to lose heart—even if you made a knee-jerk reaction along the way. Instead, focus on a long-term plan that’s built just for you and your goals—including how you feel about risk. Need help with your plan? Don’t hesitate to call us.

As always, thanks for your confidence in us.

Investment return and principal value of security investments will fluctuate. The value at the time of redemption may be more or less than the original cost. Past performance is no guarantee of future results.

Diversification does not assure a profit nor does it protect against loss of principal.

The Urgency of Emergency Planning

August 14, 2020

If this was 2019, I might be talking leisurely to you about the need to have an emergency plan. Now 2020 has made us more aware of how important that is. Fortunately, if we missed it the first time, hopefully there's a second chance to plan. Let’s take advantage of it.

The Best Time to Plan

Of course, we all know that you should plan BEFORE an emergency strikes. You don’t have to look far to see what happens when we’re caught unprepared. One of your top priorities should be working towards saving enough to cover three to six months of expenses. Sound daunting? Like most things in life, there’s nothing wrong with tackling it one step at a time.

There are a few things to consider for an emergency account.

Read Setting Up an Emergency Fund—What You Need to Know for some tips.

Read Now

Remember the Basics

While the investment and saving side of planning are critical, other details require your attention. Having your accounts in order is also important in an emergency. And doing it now gives one less thing to stress over. Here are four things to do:

  1. Solidify your long-term plans. If you’ve put off an estate plan, I encourage you to take that step. Your financial plan isn’t complete until you have that in order. Legal documents include a will or trust, power of attorney and medical directives. You’ll also need to appoint people to carry out your wishes.
  2. Name names on your financial accounts. Make sure you have other people on your accounts who can or will take over. That includes beneficiaries on retirement accounts and interested parties on brokerage accounts. Bank accounts, credit cards and other investments will need the same.
  3. Stay organized. Keep papers in order, including account information, statements or other documents that you may need to get your hands on quickly. That also includes who you work with—financial advisors, attorneys, doctors, insurance agents, etc. Hard copy or electronic, make sure you can easily access the information, and others can too if needed.
  4. Share with loved ones. Finally, communicating with your family is a key part of being prepared. They’ll need to know where to find things and what’s in your plan. Together, you should also decide who will do what in an emergency.

It’s Work, but Worth It

Planning takes thought and commitment, but the result will be worth it. I hope you take that time for yourself and your family. And if you need help with your financial plan or updating your accounts, we’re available. For fast service, you can also update your beneficiaries on our website.

We’d love to help you prepare for whatever comes next. Don’t hesitate to reach out.

Family Money Discussions? Practice, Practice.

August 21, 2020

Why is it so hard to talk to our families about money? It can be uncomfortable for parents and children to have conversations about financial issues, even if they are your plans. Maybe it’s like other things we do—it just takes practice.

Money Talk Opportunities and Necessities

There are certain times in a family’s lifecycle when opportunities to discuss money arise and other times when it’s critical. Talks may be easier if you have them more often, starting when children are younger. But, if they’re older—even grown—it’s not too late.

Starting an allowance for a younger child or sending your high school grad to college (even virtually) are great opportunities to talk about money responsibilities. What if your grown child comes back to the nest? It’s also a good time to discuss finances.

Money talks with aging parents may be hardest for adult children and the parents themselves. No one wants to think about the need to help mom or dad with finances or caregiving. Parents may find it difficult to share their plans. However, these may be the most important conversations.

Need Help Discussing Money Plans With Your Family?

Get ideas and how-to’s in Family Money Talk: The Key to a Strong Financial Plan.

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More Talk Can Make It Easier

I encourage you to make money talks a regular habit and to start somewhere. COVID-19 may give you an opening. As the pandemic stretches on, the need for planning continues for finances, retirement plans and unfortunately, health plans. Your family—even children—may feel more confident knowing there’s a plan.

Start Talking. We’ll Help With the Plan.

Remember we’re here to help with questions about your finances. If you find yourself facing a family tragedy, our estate transfer services may be able to help. Don’t hesitate to call us.

As always, thanks for your confidence in us.

Winning by Not Losing—A Good Strategy?

August 28, 2020

Discussions about upcoming sports seasons—or not—remind me of a long-held thought that more games are won by not losing. While that can be debated among sports fans and statisticians, the theory applies to investing as well. Let’s explore why.

“Winning by Not Losing” in Investing

Not losing in sports can mean building a strong defense or avoiding turnovers and errors. These also apply to how you handle your investments, which is especially important during volatile market times.

Do You Know How to Invest During Rocky Times?

Read our latest article: Volatile Markets? Kick Up Your Financial Knowledge.

Read Now

Playing Defense

In sports, the goal of defense is to prevent the other team from scoring. For investing, the goal is to position your portfolio against losses. While we like our investments to perform well, behavior finance tells us that investors focus more on not losing than they do on winning big gains. 

There is something behind that fear; mathematically, investments are penalized more from losses than they are rewarded from gains. How? For every loss, you need exponentially higher gains just to break even, as shown in the illustration.

Cruel Math of Losses

Market corrections and losses will happen. When they do, investors must make up the loss—and more—just to break even.

Avoiding Turnovers

Turnovers in sports give the opposing team an advantage. With investing, mistakes or straying from your plan—such as jumping in and out of the market or chasing performance—can be negative for your long-term goals. These “errors” may result from fear or forgetting that losses can occur even when markets are performing well.

What Can You Do?

A principle that can help you play defense is having a proper asset allocation. It starts with diversifying, or including a variety of different stocks, bonds and cash in your portfolio, which may help cushion losses. Asset allocation is how much of each kind of investment you have based on your timeline and how you feel about risk. Having a mix that fits you can help you stay the course no matter what the markets are doing. It can also help you avoid the mistake of chasing the highest performers.

Let Us Help

Need help seeing if you are diversified properly and your portfolio risk matches your needs? Request a free portfolio review or let us answer questions you may have; just call us.

We’re serious about helping you reach your financial goals. Thanks for entrusting us with them.

Best Regards.

Investment return and principal value of security investments will fluctuate. The value at the time of redemption may be more or less than the original cost. Past performance is no guarantee of future results.

Diversification does not assure a profit nor does it protect against loss of principal.

Together: How We "Play" It

July 2, 2020

July is a special month for us, and not just because of Independence Day. Every year we look forward to the American Century® Championship—a celebrity golf tournament that brings sports and entertainment personalities together in an exciting competition.

It’s fun to watch even if you’re a non-golfer. But the Championship isn’t just about the game or us. It’s about changing lives by supporting causes we’re passionate about. After the hazards so far in 2020, the Championship is just one way we’re choosing to play out the rest of the year with conviction. Let me share how we can make a difference—together.

How Will You Play It?

Learn more about the American Century Championship – July 10-12

Watch. Win. Give.


How We Play It

Playing golf is one thing, but managing your money and making a difference are serious business for us. Our inspiration for both started with our late founder and his desire to do something meaningful for people. In the beginning, it was about helping individuals become financially independent.

Now, our purpose also includes impacting others through medical research that has the potential to save lives. It’s the heritage the Stowerses—our founder and his wife—gave to us.

Learn how Jim and Virginia Stowers turned their passion into a legacy. Read their story and find out how you play a part too.

How Will You Play It?

Helping you with your investments is still as important today as it was when Jim started the company. How you personally approach your finances is just as important.

You may be rethinking your previous planning methods; especially given the unexpected events we’ve experienced. Continued market ups and downs may also have you wondering what to do next.

Like a golfer who faces challenges on the course, market turbulence can threaten to take you off track. It helps to know how to adjust when difficulties arise. Our Weathering the Storm: 4 Time-Tested Investing Strategies article is a good resource for you. If you’d like to speak with someone about your finances, please call us.

Watch. Win. Give.

I hope you will join us in helping change circumstances for others—and have some fun while you do it. Here are two ways to get involved:

  1. Tune in to the American Century Championship live broadcast on July 10-12 on NBC affiliates. Monies from the Championship will support COVID-19 relief efforts and the fight for social equity.
  2. Show us how YOU play it. Join our Trick Shot Challenge for a chance to win two tickets to next year’s American Century Championship. No purchase necessary. Void where prohibited. Must be 18 to enter. Read full contest rules. Enter today.

As always, we appreciate your confidence in us. Together, let's reach for new ways to impact the future of prosperity and health for others.

Best Regards.

The Future. How Will You “Play It?”

July 10, 2020

If there’s a lesson from 2020, it’s that you can’t always know what’s coming your way. However, you can decide what you will do. You’ll hear that message this weekend when you tune in to the American Century Championship celebrity golf tournament. We’re asking ourselves and you: How will you “play it?” How can you respond to make the future better for yourself and others?

Tune in to the American Century Championship - July 10-12

  • Watch sports and entertainment MVPs and legends compete to win and change lives.
  • Take the Trick Shot Challenge for a chance to win tickets to next year’s tournament in Lake Tahoe.

This contest has now concluded. No purchase necessary. Void where prohibited. Must be 18 to enter. Read full contest rules.

Let me share how we’re choosing to respond. It’s starts by sticking with our convictions—both in how we manage money and seek to positively impact the future. I also have some ideas about how you can “play it” for the people in your life.

How We Play It for You

For you, our number one job is delivering investment results to help you save for college, retirement or for any other reason you invest. Your goals are important and we actively manage money to help you be successful. Our investment professionals work to outperform by:

  • Repeating strategies they believe can work time after time.
  • Staying vigilant and knowing what makes markets move and change.
  • Taking smart risks, not unnecessary chances, with your money.

Learn more about how we’re invested in you and your future.

How We Play It for Others

Making a difference is part of our DNA. Throughout our history, we've been committed to helping people become financially independent. And through the unique relationship with our primary owner, the Stowers Institute for Medical Research, our dividend payments support the Institute's work of uncovering the causes, treatments and prevention of life-threatening diseases.

The American Century Championship is an extension of that purpose and will support some of today’s most critical causes.

As our client, you play a role in all of it. Your continued confidence allows us to keep reaching for ways to impact not only your future, but the future of others. Thank you for that.

How You Play It

You wouldn’t be investing if you weren’t playing it for the future. But I also know that investing can be complicated. It’s our job to break it down and help you stay informed so you can make decisions that are right for you.

Part of it is making real people available to answer your questions, but you also need the right tools. It’s why you hear from us about the markets, events in our world, and other topics that may impact your finances. Find our latest insights and news in our COVID-19 Center.

Play It for Others Too

Whether it’s family, friends or other important people in your life, I’m convinced that few of us invest only for ourselves. How can you impact your loved ones? This year has made it evident that planning is crucial—especially for the unexpected.

Read Plan Your Legacy at Any Age to find out why estate planning is important for your loved ones and get information to help you start.

Together: How We Play It

Large scale or for the people in your circle, making a difference motivates us to do our best. We’re here to help you make an impact for those you love. Help us impact others by tuning in to the American Century Championship.

Let’s play this together for the future. If you need help, don’t hesitate to call us.

Best Regards.

What's Next for Your Money?

July 17, 2020

While markets continue their up and down reactions to headlines and economic news, it can be hard to know what to do with your investments. Should you stay the course? Run to safety? Uncertainty can make you wonder what the next move should be. Let’s review some basics to consider for money decisions.

In or Out? There Is an In-Between

Many people think about investing as being “in” or “out” of the markets. We perceive “in” as risky and “out” as safe during volatile times. Let me remind you that investing has a risk spectrum—from low to high. In between cash and the most aggressive stocks are many different levels of risk.

The risk spectrum also relates to rewards—generally the higher the risk, the higher the potential returns, and vice versa. What’s important is that the risk/reward balance in your portfolio fits your goals and your timeline.

Understand the importance of risk for your short- and long-term goals. Read Golf and Investing: More in Common Than You Think to put it in perspective.

One-Fund Wonder?

In music, a one-hit wonder is a song that’s briefly popular. Investors with just one investment—unless it includes a mix of others like a fund-of-funds or model portfolio—may set themselves up for a one-fund wonder. Like that one ‘80s song, your investment could be famous for a performance spurt followed by an infamous sudden drop. We advocate a diversified portfolio.

Expand Your Playlist

A diversified portfolio includes a mix of the broad investment categories below. Each category plays a different role in a portfolio and within each are several choices with varying levels of risk and reward.

Money markets fill a stabilizing role and give you easy access to your money. However, sitting in a money market fund to avoid risk can be risky too. Returns likely will not keep up with inflation.

Bonds play the lead for income. They are essentially loans from you to entities (corporations, governments) that agree to pay you back with interest over time. While most can have less risk, the rewards are generally lower than stocks.

Stocks take center stage for growth, allowing you to participate as companies grow. Stock funds range from moderate to very aggressive—depending on the kinds, sizes and locations of companies they invest in. They typically offer the highest rewards with the highest risks.

Need help putting your portfolio together? Call us for help.

Find Your Fit, Repeat

Deciding what to do with your money should not be an emotional choice. Having your portfolio risk match you and your goals is one way to do that. Another way is to invest regularly. That helps take the emotion out of when to invest.

Read Keep Emotions in Check—Automatically to see how automatic investing can help you remove the emotional decisions and take advantage of market swings.

Your Next Step

Deciding if you should make a change with your money is an important step. Being aware of the investing principles I’ve discussed is a start, but sometimes talking it over with someone can help. That’s why we’re here. Please don’t hesitate to call us.

As always, thanks for your continued confidence in us.

Best Regards.

Investment return and principal value of security investments will fluctuate. The value at the time of redemption may be more or less than the original cost. Past performance is no guarantee of future results.

This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal or tax advice.

Diversification does not assure a profit nor does it protect against loss of principal.

Generally, as interest rates rise, the value of the securities held in the fund will decline. The opposite is true when interest rates decline.

Financial Decisions: It’s Personal

July 24, 2020

What’s more personal than money? Not much. That’s because personal decisions are intertwined with finances, and vice versa. It’s nearly impossible to make a financial decision without it affecting your loved ones too. Below are some thoughts for how to align personal and financial decisions, and not lose sleep over them either.

Consider Family and Finances as One

Financial matters that impact you also affect those around you. An income setback, a job loss, and as we know well, a global pandemic, can change more than your money. Situations such as these and even less critical ones can also affect relationships, so it’s important to consider the impacts of your choices.

A current example: As states and administrators navigate reopening (or not) parents may need to adjust their work life (again). Grandparents and other family members may also be called upon to help, giving caregiving a whole new meaning.

Traditional and expanded caregiving needs can change family dynamics overnight. But even non-critical events need a plan. Hopefully you can prepare for these very personal and financial decisions before they occur, though I realize sometimes it’s not possible. Either way, I encourage you to consider your family and your own financial future in decision making.

Read Caregivers: Take Care of Yourself, Too for information about how you can manage finances in a caregiving situation.

Evaluate Tradeoffs and Priorities

Financial decisions often boil down to tradeoffs. A decision to invest for retirement may mean you spend less now in exchange for a potentially comfortable lifestyle in the future. Saving for an education could equate to cheaper family vacations, but hopefully less reliance on student loans for your child later.

These examples affect your bottom line today but may be worth a payoff later. Choosing the opposite—spending today—will also affect your future finances. Weigh priorities and their impacts when making financial decisions.

Give Yourself a Break

Finally, knowing your financial decisions impact your loved ones can feel weighty. However, I encourage you to not fret over your choices—past or present. As humans, we feel proportionately worse about losing money than we feel good about gaining it.

Even if you’re rethinking a decision, you can keep moving forward. And if you need to talk over your money decisions with someone, remember we’re here. Don’t hesitate to call us.

Thank you for allowing us to be part of your personal financial decisions. We don’t take it lightly.

Best Regards.

Are You Feeling the Pressure?

July 31, 2020

It’s the end of July, and who would have imagined our lives and finances would still be under such pressure? With virus cases continuing to rise in many places, social questions still outstanding and the markets responding differently from day to day, it’s no wonder we’re feeling the weight. Taking control may offer relief.

The Link Between Health and Wealth

Stress of any kind can have an impact on our wellbeing. From sleepless nights to physical symptoms, it’s clear that prolonged stress is a concern. Beyond our health, worries about how COVID-19 did or still could affect your finances is real, too.

According to a recent survey , Americans report that they are nearly 15% more financially stressed now compared to the end of last year. Unfortunately, the respondents believe this heightened stress could have a lasting effect. On the bright side, the study indicated that people are paying more attention to their finances. If you are stressing over money, the resource below may help.

Feeling the Pressure?

Read Beat Financial Stress: The Connection Between Health and Wealth.

Read Now

Just Do One Thing

Taking control of your finances is one way to help relieve stress. If that sounds stressful, the key may be to take one step at a time. You don’t have to solve all your financial questions at once.

A way I relieve stress is to organize something. It’s my way of controlling one thing amid so many things that I can’t. I encourage you to do the same with your finances.

What could that look like for you? Maybe it’s requesting a portfolio review from one of our consultants to make sure you have the right amount of risk for your current situation. Or reviewing your budget to see if it still works for your family.

Another thing you can do is simplify, especially if your investments are spread out among different places. How about bringing that old 401(k) together with a retirement account here? Viewing your investments in one place can make it easier to keep track of everything and see how you’re progressing.

Bringing your money together can relieve stress and more.

Read 3 Smart Reasons to Streamline Your Financial Picture.

Read Now


Taking care of just one thing is a good place to start in reducing financial stress. Talking it over with a real person can help, too. That what we’re here for. Please don’t hesitate to call us.

And as always, thank you for letting us help with your financial future.

Best Regards.

This information is for educational purposes only and is not intended as a personalized recommendation or fiduciary advice. There are different options available for your retirement plan investments. You should consider all options before making a decision. Our representatives can help you evaluate all of your distribution options.

Unsettled World, but Still Hopeful

June 5, 2020

I think it’s safe to say that the past few weeks and months have been challenging for most people in our country. Impacts from the COVID-19 pandemic have led to financial market volatility, staggering unemployment and a potential recession.  

On top of that, our nation is experiencing deep pain. I recognize that as much as I am troubled by events in the U.S., I cannot fully appreciate what George Floyd’s family, friends and the African American community are feeling. My hope is that you, your family and community are healthy and safe; and that the remainder of 2020 will be a time of renewal and recovery. 

The Market Echoes Hope 

Despite a world pandemic, signs of recession and a distressing social environment, the stock market continues to remain positive because of investors’ expectations and their hopes for resolutions. We believe this reinforces the stock market’s forward-looking view versus the bond market, which reflects today’s volatile elements. However, like many circumstances these days, markets can change quickly. Regardless of which direction, we are here for you. 

Through times of uncertainty, we are thinking about you and your investing goals. It’s why our investment professionals stay focused on the long term and manage your money with the same steadfastness as always. We believe it can help you find success through the many ups and downs the markets may encounter. 

How can you be ready for any environment? Follow our lead and keep a long-term view of your own investments. To stay focused, it helps to have a plan. If you don’t have one, or want to recheck a current plan, remember we’re here to help. 

As always, we appreciate your confidence in us. 

Innovations and Evolutions

June 12, 2020

Six months into this decade, and who would have thought that 2020 would prove to be a time of so many drastic changes? Many have altered their personal lives regarding health, perspectives and much more. It takes innovative thinking to adapt—and that also applies to your finances.

Innovations and Your Investments

Innovation is a significant piece of the puzzle that our portfolio managers look at when deciding in which companies to invest. Companies that adapt and change often signal good opportunities for growth, even in uncertain times.


Evolving Services

Just like your investment needs can change, so can what you require from services. Maybe you want to make account changes faster or need help navigating market turbulence. Two of our most recent service changes include:

  1. Enhanced measures to help keep your private information safe when you log in to americancentury.com. If you haven’t used our convenient online services, register to try them.
  2. Lower minimums for our advisory service mean more clients can access financial planning and personal advice from a real person. I encourage you to find out about our Private Client Group.

A Foundation of Innovation

Innovation is also part of our DNA. You may not know that our primary owner is world-class biomedical research organization, to which we pay annual dividends ($1.6 billion since 2000).

This ownership gives us a story unlike any other in the investment world. Read how it allows us to have a different kind of purpose that has the potential to save lives. You play a role in that too.

Your investment helps us support this ongoing medical research, and we can’t thank you enough. We’re also committed to continue evolving as you change. Don’t hesitate to reach out if you have a need right now.

Private Client Group advisory services are provided by American Century Investments Private Client Group, Inc., a registered investment advisor. This service is generally for clients with a minimum $50,000 investment. Call us to determine the level of service that is appropriate for you. The advisory service provides discretionary investment management for a fee. All investing involves risk.

Today’s Road Bumps Won’t Stop the Future

June 19, 2020

Current conditions are causing us to focus only on today’s financial needs—for good reason. But there’s another reality we should not lose sight of: Today’s road bumps won’t stop the future, and that includes your retirement. The solution? Balance today’s needs with tomorrow’s goals.

Sidestep Roadblocks: Stay Balanced and Informed

Balancing finances for now with your retirement goal is essential. If you’re already retired or it’s a few years away, it’s even more critical. I encourage you not to allow current road bumps (or craters) steer you completely off track.

Instead, refocus some of your financial energy on the future. That includes being aware of some important aspects for retirement. We have some resources to help.

  1. Social Security is a major player for retirement income. Review the latest updates, or if you need the basics, learn how to maximize your benefits.
  2. Medicare will be important for health care in retirement. Review the 2020 Medicare changes and what they may cost.

New Realities for Retirement

Developments since COVID-19 could also affect your retirement plans. Here are a few to consider as you reassess:

  • New timeline? Market activity has been down, up and down again. Perhaps your portfolio is a bit out of alignment from the turbulence. Or maybe you are second-guessing a quick buy or sell decision when the markets (and you) first reacted to the pandemic. A portfolio tune-up and an evaluation of your timeline may be a good place to start.
  • New tax implications? Government stimulus packages could have a long-term impact on U.S. taxpayers, including retirees. Now may be time to consider some tax-advantaged options, including IRAs.

Pre-tax verses post-tax contributions, taxes when you withdraw or tax-free withdrawals—compare Traditional and Roth IRAs to see which might work best in a new tax world. You may also want to look at other tax-advantaged investment choices, including municipal bonds. Call us to find out more.

Detours Don’t Have to Derail Your Future

Looking ahead, there’s still much uncertainty about outcomes for the pandemic, social distress and how the economy and markets will react. But we can all be certain about this: The future will come. Let us help you refocus and reevaluate so your plans don’t break down along the way.

Please consult your tax advisor for more detailed information regarding the Roth IRA or for advice regarding your individual situation.

Taxes are deferred until withdrawal if the requirements are met. A 10% penalty may be imposed for withdrawal prior to reaching age 59½.

IRA investment earnings are not taxed. Depending on the type of IRA and certain other factors, these earnings, as well as the original contributions, may be taxed at your ordinary income tax rate upon withdrawal. A 10% penalty may be imposed for early withdrawal before age 59½.

Money Smarts: Pass It On, Build It Up

June 26, 2020

If recent market ups and downs have done anything positive, it’s reminded us how crucial it is to make wise financial decisions and to know how to handle money properly. That’s also an important lesson you can share with kids because, like it or not, they’re watching and learning from you. The good news? We can help you teach money smarts with our five lessons.

The Right Time to Teach

Parents, grandparents, aunts, uncles or family friends—anyone can make a difference in a young person’s life when it comes to teaching them about money. It doesn’t matter if you sailed through this current financial upheaval or have taken a few missteps. Either situation can be a good life lesson for kids. At the end of the day, we want them to be successful and avoid pitfalls we or others may have experienced.

Is financial knowledge important? A recent survey suggests that it’s more important than ever. Nearly 9 in 10 Americans report that the COVID-19 crisis stressed their personal finances. The biggest culprits?

Money Stressors During Covid-19

  • 54% said they did not have enough saved
  • 48% said they’re worried they don’t have enough to pay bills
  • 39% said they are stressed about job security

Source: National Foundation for Financial Education, April 2020

Enroll Kids in “Money Camp”

Help your kids be more prepared for their futures. This summer may be a great time to get them learning about all aspects of money. With limited openings of camps, swimming pools and other typical summer activities, take advantage of the extra time they may have and enroll them in your own “money camp.” Not sure how or where to start? We’ve got you covered.

Our Raising Financially Aware Kids eBook includes activities for any age—from understanding the value of money to saving and investing to managing credit for older teens, you’ll find a variety of activities to keep them busy. Download the free eBook.

Sharpen Your Money Smarts Too

While you’re exploring ways to help the kids learn about money, don’t forget to stay on top of your own financial education. Right now, it’s particularly important to understand how markets can react to crises, and what you should (or shouldn’t) do about it. Below are some resources that can help.

Sharpen You Own Money Smarts

Bear markets? Bull markets? Watch our video to learn what they are and how they relate to the economy.

Buy, Sell, Hold? Learn the do’s, don’ts and maybes of managing finances in volatile markets.

Be a Lifelong Money Teacher and Learner

It’s never too early to start teaching kids about finances. It’s never too late for you to increase your own knowledge. For you, another important aspect is learning about your portfolio. Is it working smart for you? If not, how and why? Call to let us help

Investing in Emotional Times

May 1, 2020

It’s an emotional time for many with health and financial fears. The worst fear may be the unknown. It’s also a time when many make hasty decisions. But sometimes the best course is to take a step back, weigh the options and rely on what you know to be true. 

What Are You Worried About?

Last week we asked what worries you most right now. Not surprising, health concerns ranked first. Many expressed that they were equally anxious about the combination of their financial futures, employment, life after the pandemic and market volatility. Let me address health and financial worries here.

Plan for Health Concerns

Caring for yourself can take on many forms, but one that may be overlooked is having plans in place to address health issues. These include health insurance, medical, estate and comprehensive financial plans. All can be critical if you experience a health problem. In addition, planning goes a long way to helping relieve stress and anxiety because you know you’ve taken steps to prepare.

Choose Strategies Over Emotions for Your Finances

While the answers to many concerns may take time for individuals and the nation to figure out, there are strategies for addressing market volatility anxiety. Large market dips—even for a few days—can rattle the most confident investor. In the midst, I encourage you to resist quick moves that may do more harm than good in the long run.

Below are two strategies to help keep emotions in check and your money working for you. You can also find more about these in our COVID-19 Center.

  1. Focus on your long-term plan. You have an investing plan for a reason, and it’s designed to help you reach your end goal—even through market turbulence. Our CIO Rich Weiss says that there’s no room for knee-jerk reactions in your plan. Watch his latest video for more perspective. (No plan? Call us.)
  2. Take advantage of market swings. It sounds counterintuitive to invest more when all you want to do is protect what you have. However, volatile markets can offer opportunities.

Is it complicated? Only if you try to time the markets. Market timing requires you to be right twice: When you buy and when you sell, and few, if any, are successful at it.

A better option is to invest regularly and take advantage of dollar-cost averaging—buying more shares when prices are low and fewer shares when prices are high. The easiest way is to set an automatic investment at an interval of your choice. Doing it automatically takes the emotion and guesswork out of “when” to invest. Read more about dollar-cost averaging in our latest article.

Confidence as You Look Forward

Fear and worry are normal when everything around us isn’t. I hope you take comfort in knowing we are in this together, and we are here for you. If your investment plan has you concerned, please don’t hesitate to reach out to a consultant for help.

As always, our best to you and your loved ones.

Risk Is Inevitable. Let’s Manage It.

May 8, 2020

As we experience market ups and downs sparked by the pandemic, it’s a good reminder that risk is a natural part of using money. While there’s no way to get around risk, there are ways to manage it. 

Risks to Your Money

From hiding your money under the bed to investing in the latest trends, risk is involved in all the ways you seek to preserve or grow your money. Even the mattress option has risks: It’s not insured. It won’t grow. And, it won’t keep up with inflation. I encourage you to know the risks before you decide where to put your money.

Saving vs. Investing vs. Trading

It might help to compare these and their potential risks and rewards. Many confuse them and how they’re different, so let me break them down.

Saving is putting money aside for the near future.

Bank savings are the traditional way, but others have gotten creative. Think coffee cans, freezers and of course, under the mattress.

Preservation is the goal; however, in the best of times you may earn interest, but right now the annual interest rate is only about .07%.1

1Federal Deposit Insurance Corporation, as of April 27, 2020.

Investing is buying and holding assets for long-term results.

Investing can help you build wealth over time for long-term goals such as your retirement. There are many investment vehicles, including stocks, bonds, mutual funds and exchanged-traded funds. Within each category are a variety of choices too.

Rewards can be much higher than a savings account but investing carries more risks—one of which we know well: market risk. The stock market’s average annual 10-year return is 11.68%, but its one-year return is .86%.2

2S&P 500 Index data as of April 30, 2020. The S&P 500 Index is a capitalization-weighted index of 500 widely traded stocks. Created by Standard & Poor’s, it is considered to represent the performance of the stock market in general.

Past performance is no guarantee of future results. Investment return and principal value of security investments will fluctuate and it is possible to lose money.

Trading is buying and selling assets for short-term results.

Trading attempts to take advantage of market ups and downs at a given point. Stocks, bonds and commodities (goods that can be sold on an exchange) can all be traded.

Rewards can be higher, but the lows can be much more dramatic too. You don’t have to look too far into the recent past to see how risky it could be. This year alone, the stock market fell approximately 34% between February and March.3

3Source: Wall Street Journal Markets, S&P 500 Charts, May 2020.

At American Century Investments, we invest for the long-term and believe you should too.

How Much Risk?

The answer is personal and one you should base on your goal for the money—preservation, long-term or short-term—and your feelings about risk. Start by answering these questions:

  1. How much can I afford to lose? For the answer, you should also consider how much you are willing to lose.
  2. When do I need the money? Your timeline can clue you in on how much risk to take. More time can equate to more risk because you have time to make up potential losses. Usually you’ll want less risk when you don’t have time to recoup losses.

Don’t Avoid Risk, Manage It

There’s no way to avoid risk if you want your money to have growth potential. However, let me offer some ways we can help you manage it:

  • Understand your true risk tolerance. It’s one thing to say how you feel about risk on paper. It’s another to experience a real loss. Our consultants can walk you through questions to help you figure out yours.
  • Know your actual timeline. Let’s take the guesswork of when you might need the money and help you create an actual plan for it.
  • Match your investments. After settling risk and time answers, we’ll help you choose investments that fit. That includes making sure you have a mix of different kinds (diversification) and the percentages that add up to your ideal risk level (your asset allocation).
  • Make it work for you. Finally, we’ll offer ideas to help you stick to your plan. One we champion is automatic investing—setting a regular time and amount to invest—so you don’t have to worry about “when,” and you can stay invested no matter what markets do next.

Why Manage Risk?

The alternative to managing risk is to avoid it, and that can have a long-term effect on your money and what you’re investing for. Some jumped out of the markets at the first sign of rough waters as COVID-19 began to spread. They may have also missed the moderate rebound we saw later, and unfortunately locked in those losses. Let us help you find a better way.

Bulls, Bears & Recessions. What’s Your Next Move?

May 15, 2020

In the financial world, we use labels to describe what’s happening in the markets or the economy. What labels don’t do is tell you what to do with your portfolio. Honestly, they shouldn’t. Focusing on long-term goals is a better way to make decisions—especially during uncertain times.

Labels Can Trigger Emotions

Some labels can spark anxiety or make us feel too confident. Many experience fear when they hear terms like bear market, or even worse, recession. Out of distress, some will act without considering potential long-term effects on their money.

On the flip side, bull markets tend to give us more confidence. Unfortunately, they can also make us forget that bear markets occur too. Extended bull markets, like we experienced over the past decade, can make a decline seem even more dramatic.

A bear market is a 20% drop in an index (often the S&P 500 Index) from its most recent high. It’s not the same as a “correction,” which is a 10% drop.

A bull market is a 20% increase from the most recent low.

Recessions describe economic slowdowns. Officially, they are indicated by two consecutive quarters of decline in the gross domestic product (GDP)—the output of goods and services in a country or economy.

The S&P 500 Index is used as a benchmark for stock market performance. This performance is not an indicator of economic health, but the two are related.

Bears and Recessions: Chicken and Egg?

Recessions and bear markets are often discussed in the same conversation because recessions tend to follow bears, but not always. For example, right now the stock market has returned to bull territory—having risen 20% from its most recent low—but most economists agree that the U.S. economy is in recession.

It’s important to note that markets usually recover before the economy does and recessions can last longer. Why? The stock market looks to future earnings of businesses and where investors believe the economy is headed, versus current economic output.

As the U.S. gradually reopens, many are hoping that the economy will recover soon. To hear about possible scenarios, be sure to watch Multi-Asset Strategies CIO Rich Weiss’ latest video.

What Next for Your Portfolio?

Investing through a recession isn’t something you’ve had to deal with in a while—newer investors may have never had to at all. Before the pandemic, the markets had been so good for so long, so it feels like new territory.

Whether you acted after the initial market declines in the first quarter or decided to hold the line, recent volatility and a slowed economy have likely impacted your portfolio. However, those events shouldn’t necessarily dictate what you do next. Instead, base portfolio decisions on your own goals, how much time you have and how much risk you want to take.

Call for Backup

You don’t have to navigate market conditions alone. Whether you need to stay the course or reallocate, it’s important to talk through your options before you make a move. That’s why we’re here. Please don’t hesitate to call and let us help.

When Doing the Right Thing Matters Most, We’re Here

May 22, 2020

Times of crises often drive people to seek help—even if they have never asked before. That’s a good thing. Who can go through life without needing assistance from time to time? When you want to know if you’re doing the right thing with your money or just need a second opinion, you’re in the right place.

Help From a Name You Know

Many of you are long-time clients, having first invested with us 20 or more years ago. Thank you!  We appreciate the loyalty and commend you on your long-term investing view. That same view guides how we manage your money.

There’s something else we’re passionate about that you may or may not know. While we started out as a mutual fund provider, we’re also here to help answer the question many people want to know: Am I doing the right thing with my money?

You’re in the Right Place

I want to make sure you know about the services available when you need help. The following may be especially helpful during the uncertainty we’re experiencing now in both the markets and the economy.

Investment Guidance – Get help choosing investments that address a specific need—such as capital preservation. A consultant can help you understand the different funds we offer and which may match what you’re looking for. The service is free to any American Century® client.

Portfolio Reviews – Go a little more in-depth with a portfolio review. A consultant will look at your portfolio as a whole and make sure it fits your specific goals, your timeline and especially for right now: whether you have the right amount of risk. Portfolio reviews are also free upon request to clients.

Advice and Planning – If you’re looking for more attention to your finances, check out our Private Client Group.* This newer service may be our best kept secret yet. About 1,000 of our clients have already taken advantage of it because they like having dedicated financial consultants in their corner—plus the financial advice, in-depth planning and expert portfolio oversight if offers. 

You might also be surprised that our premium service does not have the high minimums required by other advisors and it’s available for one-fee**—a truly unique feature in our industry.

Want more information about working with an advisor?

Connect With a Person When You Need It

I know there are many online, or robo advisors, out there and they’ve been popular among those who like to manage investments on their own. While those have their place, there are times when it’s nice to talk to a person. You can get that here when you need it.

Also know that our consultants do not work on commissions and don’t benefit from recommending a particular investment over another. The heart of our services is to help you know if you’re doing the right thing for who and what you’re investing for. Please don’t hesitate to reach out.

*

Private Client Group advisory services are provided by American Century Investments Private Client Group, Inc., a registered investment advisor. This service is generally for clients with a minimum $50,000 investment. Call us to determine the level of service that is appropriate for you. The advisory service provides discretionary investment management for a fee. All investing involves risk.

**

Annual Investment Advisory Fee is 0.90% for balances $5 million and under and 0.70% for balances over $5 million. American Century Investments Private Client Group charges a single annual fee based on the value of your assets under management with us. The single fee includes our Private Client Solutions, along with any underlying trading costs, commissions, and custody services related to our recommendations. American Century Investments' financial consultants do not receive a portion, or a range of the advisory fee paid by clients. Client-oriented trades outside of our recommendations and other activities like wire transfer fees, may result in additional cost. 

Look to the Future—Even

May 29, 2020

Through StormsIt’s hard to think about what’s down the road when there’s so much happening right now and probably more uncertainty ahead. One thing I believe: You and your loved ones deserve a bright future. Having a plan is one way to help you on your way to what matters most.

The Future of Us

All of us will likely look back with unbelievable stories about how we spent our time in 2020. Some will have sad memories about the virus. Others will have funny tales about sheltering in place and working from home. Graduates will remember virtual ceremonies, and our kids may tell stories about how parents didn’t know math as well as the students.

What we discover about living through the pandemic may very well impact the future and how we view our finances too. We’ll likely have a different perspective about emergency accounts, savings priorities and the value of financial planning for critical times.

Plan for Better Days

Regardless of what life will look like years from now, I encourage you to not lose sight of what it could be. Planning now will be one of the best investments you can make in your own life and those closest to you.

If you don’t have the means to invest right now, don’t feel guilty. You can still have a plan regardless of your current financial status. As soon as you’re able, put these on your list of to do’s—replenishing your savings, adding to an emergency fund and investing more.

If you have children, also add saving for their education, so they can reach for their dreams. For yourself, add retirement savings too. Sometimes we think about others and immediate expenses and put off our own retirement planning. It you need help with all these priorities, we can help.

Celebrate 529 Day with Us

Despite what’s happening in our world, we are choosing to celebrate 529 Day today. May 29 is a time to focus on the importance of saving for an education and the benefits of 529 savings plans. A 529 is not only an easy way to save for your student’s future, it also offers some nice tax breaks for you now. 

The availability of tax or other state benefits (such as financial aid, scholarship funds and protection from creditors) may be conditioned on meeting certain requirements, such as residency, purpose for or timing of distributions, or other factors.

If you don’t have a savings plan for your student, I invite you to learn more, by reading our article that busts myths about 529s. You can also enter our contest for a chance to win $1,529 in a new or existing Learning Quest® 529 Education Savings Program. It will make a nice start or addition to your savings. The contest ends May 31 so you still have a few more days to enter. 

No purchase necessary. Void where prohibited. See contest rules

Pave the Way for Your Future

Education savings and retirement planning are just two ways to prepare for the future. Another way is to check up on your portfolio. A portfolio review is as important to your finances as an annual physical is to your health. Find out more about portfolio reviews, and don’t hesitate to call us to evaluate yours. It's free, and it's all part of the services you get from us.

Join me in looking towards the future with hope.

IRS Circular 230 Disclosure: American Century Companies, Inc. and its affiliates do not provide tax advice. Accordingly, any discussion of U.S. tax matters contained herein (including any attachments) is not intended or written to be used, and cannot be used, in connection with the promotion, marketing or recommendation by anyone unaffiliated with American Century Companies, Inc. of any of the matters addressed herein or for the purpose of avoiding U.S. tax-related penalties.

This information is for educational purposes only and is not intended as tax advice. Please consult your tax advisor for more detailed information or for advice regarding your individual situation.

Before investing, carefully consider the plan's investment objectives, risks, charges and expenses. This information and more about the plan can be found in the Learning Quest Handbook, available by contacting your financial advisor or American Century Investment Services, Inc., Distributor, at 1-800-579-2203, and should be read carefully before investing. If you are not a Kansas taxpayer, consider before investing whether your or the beneficiary's home state offers a 529 Plan that provides its taxpayers with state tax and other benefits not available through this plan.

Notice: Accounts established under Learning Quest and their earnings are neither insured nor guaranteed by the State of Kansas, the Kansas State Treasurer or American Century Investments.

Administered by Kansas State Treasurer Jake LaTurner
Managed by American Century Investment Management, Inc.
Distributed by American Century Investment Services, Inc.

As with any investment, it is possible to lose money by investing in this plan. The value of your Learning Quest account may fluctuate, and it is possible for the value of your account to be less than the amount you invested.

When Normal Does a Backflip

April 10, 2020

If these were regular times, you might find yourself rushing to meet an April 15 tax deadline or making a last-minute IRA deposit to squeak in one more deduction. But this is 2020 and nothing is normal.

If we ever needed a break, it’s now. Fortunately, financial relief is on the way with the stimulus package and an extended tax deadline—now July 15. What will these changes mean for you?

Unraveling Relief Packages

Congress passed the CARES Act to assist Americans as we experience threats to our health and finances. It offers help for individuals, families, businesses and industries. With several rules and guidelines included, you may need help unraveling the details.

Find those in our CARES Act: Your Questions, Answered article, as well as answers to questions we’ve received from clients like you. In addition, you’ll find an article about ways to free up emergency money if you find yourself needing to cover expenses quickly.

We’re Here for You

Whatever your circumstance, remember our consultants are available to help you walk through decisions that may impact your finances now and in the future. Please don’t hesitate to reach out.

We continue to hope for the best for you and your loved ones’ health and safety.

How Are You Managing?

April 17, 2020

The current global crisis is proving to be the ultimate stress test. While we all cope in our own ways, I hope there’s comfort in knowing that we’re in this together. This week we’re focusing on ways to help manage the challenges we’re all facing—from investments to home life.

Your Personal Stress Test

  1. Know what you can control. You can make sure your portfolio risk fits you. If you can’t sleep or shake the need to sell and cut losses because of volatility, it may be time to re-evaluate. Don’t wait to find out, request a call.
  2. Rely on the experts. Knowing that professionals are managing your money can be a stress reliever in uncertain times. Here, they actively manage your investments so you don’t have to. Learn more about active management in this week’s video. Watch CIO Rich Weiss.
  3. Relieve stress at home. We know there’s more on your mind than investing. Balancing everything may be the ultimate struggle right now. Read 7 Ways to Actively Manage Your Household for some of the best ideas we’ve found.

Let Us Help

Please don’t hesitate to reach out with your questions.

Take care of yourself and your loved ones. It’s what matters most.

Hope and Planning: They Really Do Go Together

April 24, 2020

The need to have financial and health plans in place because of COVID-19 is not a topic any of us like to think about. However, it would be a disservice if we didn’t encourage you to take steps to prepare. It doesn’t mean you don’t have hope, it means you care.

Estate and Other Plans Right Now

It’s unnerving to think that you or someone close could need to be hospitalized, but it’s equally distressing not to have a plan. That’s why this week we’re focusing on what you can do. You’ll find a podcast on how to prepare for the unexpected, as well as an article about talking to your family about your plans.

Communicating helps ensure that loved ones understand your wishes. How do you do that in these no-contact times? Review ways to stay connected—not just about money and estate plans, but also to keep family and friend ties strong too.

Planning may also include what everyday life may look like post-pandemic. I hope you were able to listen in to Dr. Sanjay Gupta—neurosurgeon and CNN chief medical correspondent—discuss this topic. If you missed it, a webcast replay is now available at our COVID-19 center.

Where Are You With Your Plans?

See how you compare with the results from last week’s family money survey. Don’t worry if you feel behind. Remember our financial consultants are here to help.

As always, we’re wishing health and safety to you and your loved ones.

Need Your Investment Plan Reviewed? We’re Here to Help.

Request a Call

*Chimamanda Adichie, TEDTalks: The Danger of a Single Story, 2009

**The average annual returns of the S&P 500 since 9/30/2000 is 6.42%. Cumulative returns since that time are 247.10%. Fact Set data as of 9/30/2020.
The S&P 500® Index is composed of 500 selected common stocks most of which are listed on the New York Stock Exchange. It is not an investment product available for purchase.

Diversification does not assure a profit nor does it protect against loss of principal.

Investment return and principal value of security investments will fluctuate. The value at the time of redemption may be more or less than the original cost. Past performance is no guarantee of future results.

The opinions expressed are those of American Century Investments (or the portfolio manager) and are no guarantee of the future performance of any American Century Investments' portfolio. This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal or tax advice.

American Century Investments is not responsible for and does not endorse any comments, content, advertising, products, advice, opinions, recommendations or other materials on or available directly or via hyperlinks from Facebook, Twitter or any third-party website. Facebook, Twitter and LinkedIn are registered trademarks of their respective owners.