Allocation Mix - Prudential Financial
September/October 2017 One of the most important decisions you can make as a retirement investor is how to allocate your retirement investments among stocks, bonds and cash alternatives. But how do you determine the right asset allocation* for your situation? Start by reviewing the information your plan provides and talking to your financial professional.
Consider the categories Your retirement plan likely offers funds or portfolios that hold investments in the three main asset classes. Stocks — Historically, stocks have provided the highest potential long-term returns but also have the greatest risk of short-term losses. Bonds — Bonds tend to provide more modest returns than stocks, but they are also less volatile. Cash alternatives — Considered the least risky of the three main asset classes, cash investments offer the lowest potential returns.
Take a look at time How long you have to work before you plan to retire may have an impact on how you allocate your assets. Your financial goals and risk tolerance also may determine the investments you choose. Generally, you may be more comfortable with investment risk when you have a longer time frame. And as retirement draws near, you may become less comfortable with investment losses.
no longer be right for you in a few years. Your risk tolerance may change as you get older. Plus, performance differences can cause your portfolio’s asset allocation to change over time. For example, if stock investments perform well and increase in value, stocks could then represent a larger portion of your portfolio than you had intended. You may need to rebalance your portfolio to restore its original allocation. With your financial professional, regularly review your investments and adjust your asset allocation as needed. * Asset allocation doesn’t guarantee a profit or protect against losses.
Putting Together
Your Asset
Allocation Mix
Review your account regularly The asset allocation you choose today for your plan account may
This is an advertisement prepared by DST. Articles are not written or produced by the named representative. DST is not affiliated with Prudential Financial or any of its affiliates. 0303455-00001-00
FINRA Reference FR2017-0427-0101/E 08/02/17
Tyler Sloves
Financial Advisor
The Prudential Insurance Company of America 445 Broadhollow Road Suite 405 Melville, NY 11747
Tel: 631-927-3363 Cell: 516-244-1565 Fax: 877-840-7822 Email: [email protected] Website: www.prudential.com/us/t.sloves With my training and commitment to my clients, I am confident I can provide a high level of personalized service. As your financial professional, I will work diligently to help you achieve your financial goals with appropriate insurance and financial products it's my promise to you. 0272965-00002-00
Get Smart about Back-to-School Shopping Back-to-school shopping is big business. In fact, it’s the second biggest shopping season after the winter holidays, according to the National Retail Federation. If you have school-age children, here are some tips to help them get ready for the school year without busting your household budget.
Do your homework Start with the supply list from your child’s teacher or the school website. If your child already has some of the items on hand from last year, you can reuse them this year. After you edit the supply list down to what you actually need, clip coupons, check circulars and look for online deals. When you do head out to the stores, stick to your list. Consider shopping alone if you have a child who will beg you to purchase items that aren’t on the list. Learn your lesson The start of the new school year often is the time when parents purchase new clothing and shoes for their children. Once again, you’ll want to look for sales and only purchase items your child actually needs. You may want to wait to buy winter clothes. If your child is having a growth spurt, boots bought in September might not fit in December. And since kids can outgrow clothes so quickly,
consider having a clothing swap with friends who have kids who are different sizes and ages than yours. Consignment shops and thrift stores also are a way to buy trendy clothes for less.
Teach your children You can turn back-to-school shopping into a learning experience for your kids. Get them involved by having them research and compare prices for items on their lists. When you go to the mall, give them money and let them decide what to buy. You and your children should agree on a list of the things they are responsible for purchasing. Then it’s up to them to figure out that if they splurge on one or two expensive items, they might not have enough to buy the other things on their list. Learning how to stick to a back-to-school budget is a lesson that may serve them well in life.
By the numbers:
Back-to-School Shopping Here’s what back-to-school shoppers were planning to buy before the 2016–2017 school year:
95% School supplies
92% Clothes/shoes
78% Backpack/ lunch box accessories
543670
Source: Back-to-School Survey 2016, Deloitte LLP
29% Technology products
32% Pre-configured “kits” offered by school or PTA
When it comes to health insurance, the more you know, the better. Here are a few terms you may not fully understand.
Got Life Insurance? A recent study by LIMRA* found that 30% of U.S. households do not carry life insurance. Is yours among them? September is Life Insurance Awareness Month — a perfect time to make sure you have the coverage you need.
Allowed amount. The maximum amount on which payment is based for covered services. You may be charged the difference if a provider charges more than this amount.
Don’t let these “reasons” stop you from buying life insurance. I can’t afford it. If you think life insurance is too expensive, do you know the cost? According to LIMRA, many people overestimate the cost of life insurance by as much as three times its actual cost. Keep in mind that life insurance can help provide financial security for your loved ones if the unthinkable happens. It’s too complicated. Six out of 10 of those asked in the LIMRA survey said they don’t know how much life insurance
to buy or how much they need. If you have questions about life insurance, your financial professional would be happy to answer them. When you stop and think about it, there’s no good reason not to protect your loved ones. Talk to your financial professional today about your life insurance needs. * Facts About Life 2016, LIMRA, 2016
Rules of the Road If you’re nearing your retirement date, it’s a good idea to learn the rules about taking required minimum distributions (RMDs) from individual retirement accounts (IRAs) and 401(k) plans. Your first RMD generally will be due by April 1 of the year after you reach age 70½.
Another RMD will be due by December 31 of that same year and then each subsequent year.
50%
If you miss taking an RMD, the penalty will be 50% of the amount you should have taken but didn’t.
You can withdraw more than the minimum amount.
$
Your withdrawals will generally be taxable at your ordinary income tax rates. For more information about RMDs, talk to your financial professional.
Deductible. The amount you have to pay for covered services before your plan begins to pay. Note that the deductible may not apply to all services. Coinsurance. Your share of the cost of a covered service once you’ve met your deductible. It is usually a percentage of the allowed amount. Copay/copayment. A fixed dollar amount you pay for a covered service, such as a doctor’s visit. Out-of-pocket limit. The maximum amount you will pay in a policy period, not counting your premium or amounts you pay for services the plan doesn’t cover.
What’s the Word?
expenses you may anticipate having. For example, your medical expenses during retirement may take up more of your income as you age and when you no longer have access to health insurance from your former employer.
Q. I’ve been reviewing various materials on setting retirement goals and have noted an emphasis on considering inflation when determining how much I need to save. What do I need to take into account when allowing for the effects of rising prices?
A. You might barely notice the effect inflation has from year to year, but the cumulative impact over time on the purchasing power of your retirement savings may be quite dramatic. But there are ways you can try to minimize the effects of inflation. Inflation can increase the costs of various goods and services over time. Even if you expect to cut back on spending during retirement, inflation could continually increase the amount of income you’ll need each year. You’ll probably want to plan for a retirement that may last 20 years or longer. Make sure to account for any extra
This publication is prepared by DST for the use of the sender. This publication is not intended as legal or tax advice. Great care has been taken to ensure the accuracy of the newsletter copy; however, laws change often and each reader’s situation is different and professional advice is essential before acting on any information herein. Whole or partial reproduction of Let’s Talk Money® without the written permission of the publisher is forbidden. All websites referenced in this newsletter are provided solely as examples of resources from which information can be obtained. The websites are not affiliated with the publisher or distributors of this newsletter. © DST, 2017
Saving more for retirement is one way to combat the effects of inflation. By contributing more to your retirement plan (or other retirement savings account) and by carefully choosing your investments, you can help your retirement savings keep pace with inflation. Also consider increasing your contributions when you receive a pay raise. To help account for inflation when planning for your retirement, you and your financial professional should consider: • When you plan to retire • How long you expect your retirement to last • Potential pay increases • Inflation from now until retirement • Inflation during your retirement years
Offering investment advisory services through Pruco Securities, LLC (Pruco), doing business as Prudential Financial Planning Services (PFPS), pursuant to separate client agreement. Offering insurance and securities products and services as a registered representative of Pruco, and an agent of issuing insurance companies. 1-800-201-6690. Each is a Prudential Financial company located in Newark, NJ and is solely responsible for its own financial condition and contractual obligations. Availability of other products varies by carrier and state. Neither Prudential Financial, its affiliates, nor its financial professionals, render tax or legal advice. Please consult with an attorney, accountant, and/or tax advisor for advice concerning your particular circumstances. “Prudential Advisors” is a brand name of The Prudential Insurance Company of America and its subsidiaries.
Recyclable 2017/05 RET P-262912 om042901
Consider the categories Your retirement plan likely offers funds or portfolios that hold investments in the three main asset classes. Stocks — Historically, stocks have provided the highest potential long-term returns but also have the greatest risk of short-term losses. Bonds — Bonds tend to provide more modest returns than stocks, but they are also less volatile. Cash alternatives — Considered the least risky of the three main asset classes, cash investments offer the lowest potential returns.
Take a look at time How long you have to work before you plan to retire may have an impact on how you allocate your assets. Your financial goals and risk tolerance also may determine the investments you choose. Generally, you may be more comfortable with investment risk when you have a longer time frame. And as retirement draws near, you may become less comfortable with investment losses.
no longer be right for you in a few years. Your risk tolerance may change as you get older. Plus, performance differences can cause your portfolio’s asset allocation to change over time. For example, if stock investments perform well and increase in value, stocks could then represent a larger portion of your portfolio than you had intended. You may need to rebalance your portfolio to restore its original allocation. With your financial professional, regularly review your investments and adjust your asset allocation as needed. * Asset allocation doesn’t guarantee a profit or protect against losses.
Putting Together
Your Asset
Allocation Mix
Review your account regularly The asset allocation you choose today for your plan account may
This is an advertisement prepared by DST. Articles are not written or produced by the named representative. DST is not affiliated with Prudential Financial or any of its affiliates. 0303455-00001-00
FINRA Reference FR2017-0427-0101/E 08/02/17
Tyler Sloves
Financial Advisor
The Prudential Insurance Company of America 445 Broadhollow Road Suite 405 Melville, NY 11747
Tel: 631-927-3363 Cell: 516-244-1565 Fax: 877-840-7822 Email: [email protected] Website: www.prudential.com/us/t.sloves With my training and commitment to my clients, I am confident I can provide a high level of personalized service. As your financial professional, I will work diligently to help you achieve your financial goals with appropriate insurance and financial products it's my promise to you. 0272965-00002-00
Get Smart about Back-to-School Shopping Back-to-school shopping is big business. In fact, it’s the second biggest shopping season after the winter holidays, according to the National Retail Federation. If you have school-age children, here are some tips to help them get ready for the school year without busting your household budget.
Do your homework Start with the supply list from your child’s teacher or the school website. If your child already has some of the items on hand from last year, you can reuse them this year. After you edit the supply list down to what you actually need, clip coupons, check circulars and look for online deals. When you do head out to the stores, stick to your list. Consider shopping alone if you have a child who will beg you to purchase items that aren’t on the list. Learn your lesson The start of the new school year often is the time when parents purchase new clothing and shoes for their children. Once again, you’ll want to look for sales and only purchase items your child actually needs. You may want to wait to buy winter clothes. If your child is having a growth spurt, boots bought in September might not fit in December. And since kids can outgrow clothes so quickly,
consider having a clothing swap with friends who have kids who are different sizes and ages than yours. Consignment shops and thrift stores also are a way to buy trendy clothes for less.
Teach your children You can turn back-to-school shopping into a learning experience for your kids. Get them involved by having them research and compare prices for items on their lists. When you go to the mall, give them money and let them decide what to buy. You and your children should agree on a list of the things they are responsible for purchasing. Then it’s up to them to figure out that if they splurge on one or two expensive items, they might not have enough to buy the other things on their list. Learning how to stick to a back-to-school budget is a lesson that may serve them well in life.
By the numbers:
Back-to-School Shopping Here’s what back-to-school shoppers were planning to buy before the 2016–2017 school year:
95% School supplies
92% Clothes/shoes
78% Backpack/ lunch box accessories
543670
Source: Back-to-School Survey 2016, Deloitte LLP
29% Technology products
32% Pre-configured “kits” offered by school or PTA
When it comes to health insurance, the more you know, the better. Here are a few terms you may not fully understand.
Got Life Insurance? A recent study by LIMRA* found that 30% of U.S. households do not carry life insurance. Is yours among them? September is Life Insurance Awareness Month — a perfect time to make sure you have the coverage you need.
Allowed amount. The maximum amount on which payment is based for covered services. You may be charged the difference if a provider charges more than this amount.
Don’t let these “reasons” stop you from buying life insurance. I can’t afford it. If you think life insurance is too expensive, do you know the cost? According to LIMRA, many people overestimate the cost of life insurance by as much as three times its actual cost. Keep in mind that life insurance can help provide financial security for your loved ones if the unthinkable happens. It’s too complicated. Six out of 10 of those asked in the LIMRA survey said they don’t know how much life insurance
to buy or how much they need. If you have questions about life insurance, your financial professional would be happy to answer them. When you stop and think about it, there’s no good reason not to protect your loved ones. Talk to your financial professional today about your life insurance needs. * Facts About Life 2016, LIMRA, 2016
Rules of the Road If you’re nearing your retirement date, it’s a good idea to learn the rules about taking required minimum distributions (RMDs) from individual retirement accounts (IRAs) and 401(k) plans. Your first RMD generally will be due by April 1 of the year after you reach age 70½.
Another RMD will be due by December 31 of that same year and then each subsequent year.
50%
If you miss taking an RMD, the penalty will be 50% of the amount you should have taken but didn’t.
You can withdraw more than the minimum amount.
$
Your withdrawals will generally be taxable at your ordinary income tax rates. For more information about RMDs, talk to your financial professional.
Deductible. The amount you have to pay for covered services before your plan begins to pay. Note that the deductible may not apply to all services. Coinsurance. Your share of the cost of a covered service once you’ve met your deductible. It is usually a percentage of the allowed amount. Copay/copayment. A fixed dollar amount you pay for a covered service, such as a doctor’s visit. Out-of-pocket limit. The maximum amount you will pay in a policy period, not counting your premium or amounts you pay for services the plan doesn’t cover.
What’s the Word?
expenses you may anticipate having. For example, your medical expenses during retirement may take up more of your income as you age and when you no longer have access to health insurance from your former employer.
Q. I’ve been reviewing various materials on setting retirement goals and have noted an emphasis on considering inflation when determining how much I need to save. What do I need to take into account when allowing for the effects of rising prices?
A. You might barely notice the effect inflation has from year to year, but the cumulative impact over time on the purchasing power of your retirement savings may be quite dramatic. But there are ways you can try to minimize the effects of inflation. Inflation can increase the costs of various goods and services over time. Even if you expect to cut back on spending during retirement, inflation could continually increase the amount of income you’ll need each year. You’ll probably want to plan for a retirement that may last 20 years or longer. Make sure to account for any extra
This publication is prepared by DST for the use of the sender. This publication is not intended as legal or tax advice. Great care has been taken to ensure the accuracy of the newsletter copy; however, laws change often and each reader’s situation is different and professional advice is essential before acting on any information herein. Whole or partial reproduction of Let’s Talk Money® without the written permission of the publisher is forbidden. All websites referenced in this newsletter are provided solely as examples of resources from which information can be obtained. The websites are not affiliated with the publisher or distributors of this newsletter. © DST, 2017
Saving more for retirement is one way to combat the effects of inflation. By contributing more to your retirement plan (or other retirement savings account) and by carefully choosing your investments, you can help your retirement savings keep pace with inflation. Also consider increasing your contributions when you receive a pay raise. To help account for inflation when planning for your retirement, you and your financial professional should consider: • When you plan to retire • How long you expect your retirement to last • Potential pay increases • Inflation from now until retirement • Inflation during your retirement years
Offering investment advisory services through Pruco Securities, LLC (Pruco), doing business as Prudential Financial Planning Services (PFPS), pursuant to separate client agreement. Offering insurance and securities products and services as a registered representative of Pruco, and an agent of issuing insurance companies. 1-800-201-6690. Each is a Prudential Financial company located in Newark, NJ and is solely responsible for its own financial condition and contractual obligations. Availability of other products varies by carrier and state. Neither Prudential Financial, its affiliates, nor its financial professionals, render tax or legal advice. Please consult with an attorney, accountant, and/or tax advisor for advice concerning your particular circumstances. “Prudential Advisors” is a brand name of The Prudential Insurance Company of America and its subsidiaries.
Recyclable 2017/05 RET P-262912 om042901
