December 2014: Your Friend on Benefits

December 2, 2014
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We hope that you had a wonderful Thanksgiving!  We sure did. It’s December and this means that 2015 is here. Like the holiday shopping that starts on Thanksgiving, your 2015 gifts will come from your preparation in late 2014. So as you gear up for the New Year, here’s what we’re covering in our December newsletter to help you make 2015 your best year ever:

  •      Your Friend on Benefits…Employee Benefits
  •      The Market Scoreboard for November 2014
  •      Illumination’s Media Spotlight: Financially Intelligent Insights

Illumination’s Insights: Your Friend On Benefits…Employee Benefits

Whether you are making $30,000 or $3 million, maximizing your employee benefits is extremely important to your financial health. I don’t just mean maximizing in the sense that you sign up for everything that your company has to offer, but strategically signing up for certain benefits and opting out of others.

Because it is employee benefit season, and over the last 10 years I’ve read hundreds of employee benefit guidebooks, I wanted to give you a plain English guidebook with suggestions on what to enroll in, in order to maximize your benefits for 2015.

Market Scoreboard: November 2014

The U.S. large cap S&P 500 led the way with a positive 2.75% for the month of November. Overall, international equities and commodities remain weak whereas most of the strength in 2014 has been displayed within the U.S. equity market. Real estate and bonds remain the other areas or leadership in the global financial markets.

Dec 2014 Marketing


Sources: Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly.

Defensive market leadership is making its presence felt despite the S&P 500 at record highs. Consumer staples and government bonds are showing some of the best performance as of late which indicates that the large investors (e.g. institutions, hedge funds, insurance companies, pension funds, mutual funds, etc.) are positioning themselves more defensively.

On the economic front, Real gross domestic product — the value of the production of goods and services in the United States, adjusted for price changes — increased at an annual rate of 3.9 percent in the third quarter of 2014, according to the “second” estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 4.6 percent. This continues to reinforce the prevailing view that the Q1 -2.1 percent GDP contraction was a weather-related fluke.

An offshoot of GDP is GNP and one of Warren Buffett’s favorite long-term valuation indicators is the Market Cap of all U.S. Equities to GDP. In 2001 Buffett said, “it is probably the best single measure of where valuations stand at any given moment.” A high valuation implies lower long-term future returns and a low valuation implies higher long-term future market returns.  Buffett’s favorite valuation indicator suggest that today’s market is indeed at lofty valuations, now well above the housing-bubble peak in 2007. In fact, we can see in the first chart above only four quarters (during the bubble) with higher valuations.

While this indicator is note useful in short-term trading, it does have a strong correlation with market returns over the next 5-10 years. At today’s price’s it is saying “buyer beware”.

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Illumination’s Media Spotlight

Here’s our monthly compilation of interesting articles and videos designed to keep you informed and engaged in the areas of personal finance, the economy and life. We hope you enjoy this month’s edition. Please send us your thoughts on this month’s articles and suggestions for future posts.

Personal Finance

Wall Street Journal: Gifts for the Financially Savvy
NY Times: Saving Ourselves From Not Saving
Wall Street Journal: Best Books For Investors  – A Short Shelf

TED: Why Some People Find It Harder to Exercise Than Others

INC: 13 Questions Mindful Leaders Ask Daily

Great Videos, Podcasts & TED Talks
Eventual Millionaire: Scaling Up Your Business Fast

Illumination’s Community Spotlight
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Cheers to our friend Cory Charlupski and his sister Rachel on taking The Babysitting Company to the West Coast. If you need a trusted babysitter on either coast, home or away, check them out.

“A great accomplishment shouldn’t be the end of the road, just the starting point for the next leap forward.” – Harvey Mackay

Having just celebrated Thanksgiving with our family and friends, we wanted to thank you for the time, insight, and support that you have shown us throughout the year. We know this is just the beginning of a wonderful journey and we look forward to many more years of things to be grateful for. Have a great finish to 2014!

All the Best,

Matt & The Illumination Wealth Team

Feel free to forward this newsletter to any of your family, friends or colleagues; if this was forwarded to you, you may subscribe here.

The opinions and forecasts expressed are those of Matt Rinkey, President of Illumination Wealth Management (IWM) and may not actually come to pass. Mr. Rinkey’s opinions and viewpoints regarding the future of the markets should not be construed as recommendations of any specific security or Illumination Wealth services. No part of this material is intended as an investment recommendation. Neither the information nor any opinion expressed constitutes a solicitation to purchase or sell securities or any of IWM’s services. Do NOT ever purchase any security without doing sufficient research. There is no guarantee that investment objectives outlined will actually come to pass. Investors should consult an Investment Professional before investing in any investment program. Neither Mr. Rinkey or Illumination Wealth nor any of their employees shall have any liability for any loss sustained by anyone who has relied on the information contained herein. Entities including, but not limited to IWM, its officers, directors, employees, customers and affiliates may have a position, long or short, in the securities referred to herein, and/or other related securities, and may increase or decrease such position or take a contra position. The analysis contained is based on both technical and fundamental research. Although the information contain is derived from sources which are believed to be reliable, they cannot be guaranteed. Past performance is never a guarantee of future results.