Dear Friends, Clients and Colleagues,

A Goldman Sachs analyst recently stated “flat is the new up”, pertaining to the markets. I thought this was a clever quip, that is, until last week happened. Last Friday’s stock market sell off was serious – a 530 point plunge in the Dow Jones Industrial Average, representing a 3% loss for the day and 10% off the market’s high in May. (on wall street) There have been many U.S. equity market downturns over time, with varying levels of severity and different lengths of recovery period. Since 1980 the S&P has fallen double digits 11 times, yes 11 times—which is less frequent than losses in prior decades! The first article below entitled Crash Rules Everything Around Me, gives a great perspective on the ebb and flow and markets with the most salient point being that with history as our guide we know that, “double digit losses and bear markets are the rule, not the exception”.

For most of our clients planning is centered on retirement income needs, and the ability to rely on their investment portfolio to fund cash needs in retirement. I have included a recent article by Dimensional Fund Advisors entitled “Yield vs Total Return”. This article explores the benefits and trade-offs of two different income generating approaches.

With all of the planning in the world, sometimes it is still difficult to manage our behavior and remain focused and disciplined. For example, the disciplined decision to stay invested during down markets — when all you want to do is sell — even though you can yield more successful results by staying focused and committed to your long-term plans. For a little levity on this subject, we included a clip from one of my favorite television series Seinfeld for a humorous look at how our behavior (and instincts) can affect our lives — sometimes in very unexpected ways.

Finally, take a peek at the CIA corner for some business updates and other news. Thank you for the continued support and trust you place in us!

Articles of Interest

Cash Rules Everything Around me
Crashes, corrections, drawdowns, losses, system resets or whatever you want to call them are a feature of the financial markets, not a sign that they are broken.

Yield vs. Total Return
Focusing on income-oriented investments can result in unintended biases in a portfolio. Biasing a portfolio toward stocks with higher dividend yields or bonds with increased yields will likely change a portfolio’s risk and return characteristics. Investors should be aware of the related trade-offs before pursuing a yield bias.

Seinfeld Clip!
Own your future by staying on course, “doing the opposite” and fighting those fear instincts. Seinfeld will show you how!

CIA Corner

•    Recommended reading:  Go Set a Watchman. I opted for some lighter reading this summer and found this book very interesting. Originally written in the mid-1950s, by Harper Lee, the manuscript was first submitted to her publishers before To Kill a Mockingbird. Assumed to have been lost, the manuscript was discovered in late 2014. Go Set a Watchman features many of the characters from To Kill a Mockingbird some twenty years later.

•    Stephanie was invited to join both the Board of Directors and serve as Treasurer for Bridges for End of Life, a nonprofit that provides information and resources to assist individuals in the Lowcountry as they navigate end-of-life realities. More information about their good work can be found here

•   We were fortunate enough to have an intern work with us this Summer. Will Tuchfarber, who is now a Sophomore at Notre Dame, helped us implement a new contact management and workflow system which will allow us to better manage our time so that we can focus on providing an increased level of service to our clients. He was a tremendous resource to us and we wish him well during the cold winters of Chicago!