Headlines you need to know this week

March 31, 2020

Best Interest regulation may be delayed

The Securities and Exchange Commission (SEC) may consider a delay in implementing its Regulation Best Interest, according to a recent report. The new rule, governing retail financial advice, was set to take effect on July 30. Other SEC filing requirements have already been extended, the report stated.

Savers may seek to tap retirement accounts

The $2 trillion stimulus package passed last week provides support for individuals, families, and small businesses that are under pressure from the impact of the COVID-19 pandemic. The legislation allows savers make early withdrawals from 401(k) plans and other retirement accounts without penalty in order to pay for bills and expenses. Rules for required minimum distributions (RMDs) are also relaxed this year.

Pandemic hits finances of majority of adults polled

Most Americans have taken a hit to their finances from the COVID-19 pandemic, according to a recent poll. In the March 13 survey, 63% of respondents said their finances were affected, including 27% with stock market losses. Looking ahead, 21% expect their finances to be severely affected.
March 24, 2020

IRS extends deadline for tax payments

The Internal Revenue Service extended the payment deadline for individuals and corporations with a tax obligation this year. In guidance released last week, individuals may defer up to $1 million and corporations can defer up to $10 million for 90 days beyond the April 15 tax deadline.

Investors prefer human advisors

Investors prefer human advisors over robo-advice, a report found. In this time of social-distancing, advisors are connecting with investors and relying more on phone, email, or other technology. The survey found that 44% of investors seek advice from a human advisor and 15% use a robo-advisor. More than half (51%) of those polled said they feel “very confident” about their investments when working with a human advisor, compared with 34% of those using robo-advice.

Advisors are fielding tough questions

In light of significant market volatility, it’s not surprising that advisors are being inundated with questions about what to do with investments. In addition, the COVID-19 pandemic and its impact on markets may be more challenging than other market downturns in history. A recent article featured several advisors who were surveyed about how they are handling tough questions.
March 17, 2020

Millennials, GenZ tapping retirement for expenses

Millennials and GenZers are saving more for retirement. But one third of savers are tapping their retirement accounts early to pay credit card and student loan debt and medical bills, a recent survey found. Of the more than 1,000 respondents, 88% said they are putting some money into savings every month. Most (72%) said they have a job with a retirement plan and about half of participants are saving 5% or more of income.

Investors less optimistic about stock prices

Bearish sentiment, as measured by the AAII Investor Sentiment Survey, reached its highest level in seven years, with 51.3% of investors expecting stock prices to fall in the next six months. Investor optimism — a view that stock prices will rise in the next six months — dropped to 29.7%. Bearish sentiment is above its historical average for the fifth time in the past seven weeks. Neutral sentiment declined 2.7 percentage points to 19.0%.

Investors stay the course in volatile times

Most investors have not made changes to their financial plan during recent volatile markets, a survey found. More than 65% of advisors said their clients were more likely to reach out to them for advice. Most individuals who are in or within a few years of retirement expressed heightened concern about their investments. Still, 60% of advisors said their clients made no changes to their strategies.
March 10, 2020

Retirement readiness improving slightly for women

Women are less confident about retirement than men. In a recent study involving some 14,000 employees and 1,600 retirees, researchers found that only 25% of women believe they are on track to save what they need for retirement and 26% believe they will have a comfortable retirement. The numbers are better for men, with 40% of men on track to meet goals and 48% confident about retirement. However, women’s “retirement readiness score” improved in the 2019 study.

Why Millennials save

Most Millennials are saving. A recent survey noted that 86% of Millennials said they had financial goals for the next five years. Still, 69% said they did not have an emergency fund and 68% did not have a savings account outside of retirement savings. The top financial goals cited were: debt repayment (57%), travel (48%), and increasing their retirement savings rate (45%).
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