Coastal Financial Planning, Inc.
Lincoln: 401.727.8151
Narragansett: 401.788.8151


I hope everyone had a safe and enjoyable Fourth of July.

I will be releasing the newsletter twice a year going forward and communicating any important notice via Facebook .  If you have not already liked our Facebook page , please do so to stay up on market events.    Like us on Facebook


In This Issue
Market Performance Report
Greece's Bailout & The Markets
Medicare Parts B & D
Thank you all
Our Question This Issue
Market Performance Report



This has been a difficult year in the market; however: this quarter's returns were favorable, although slight.


Year to date, the moderately conservative portfolios came in at .25% and the moderately aggressive accounts came in at .8%.  I believe the moderately aggressive portfolios were higher, due to equity market exposure. Although no one sector performed particularly well, these portfolios had a reduced exposure to bonds, and as a result did fare slightly better.


The numbers as of June 30, 2015

Index                     YTD         

Dow                     0.44%

NYSE                   -0.07%

S&P 500               0.57%

Russell 2000         0.03%


Please be advised that the figures above are for general information purposes and that no two portfolios are identical. Additionally, risk and time horizon are specific to each individual.


What's ahead?

From an economic standpoint, the dollar is indexing higher against other traded currency.  The 10-year treasury is down year to date, -.68%. By comparison, the 2-year bond is yielding .10%, the 5 year yield is -.75% and TIPS (Treasury Inflation Protected Securities) are down -1.06%. Floating rate bonds and high yields are offering slightly better yields at .88% and .65% respectively.  REIT's are also in negative territory, but they do offer an attractive yield, which will compel me to hold these investments at this time.


U. S. consumers are still spending (particularly on new autos), employment is recovering and the housing market has hit a 10-month high.


The corporate sector is strong, as a result of healthy balance sheets and lower borrowing costs. 


I do anticipate the markets to remain flat over the summer and then see some growth in the fall, particularly in the oil and gas industries which are at a current year low. 
Greece's Bailout and the Markets


As of July 6, the S&P opened 16 points lower in reaction to the instability in the Greek currency market.

The euro declined slightly in value and European stock markets pulled back, with the knowledge that this debt-burdened country will continue its fall. There is much speculation that Greece will have to leave the Euro and revert back to their own currency.


On July 20th, the Greeks are scheduled to make a payment of $3.9 billion to the European Central Bank (ECB). This will be a critical time for Greece and there is much skepticism regarding their ability to make this payment.


This will affect the US economy particularly in the 10-year Treasury bond. Expect the 10-year [Treasury] to trade inside the 2.25% to 2.50% range. This range has minimally vacillated throughout this Greek saga.

However, forecasters are expressing concern for a further decline in the 10-year bond, bringing the yield below 2.25%, with a downside potential to 2.10%.


At this time, I will be avoiding most Treasury bonds until the end of July in anticipation of continued volatility with the lack of resolution in the Greek currency market.

Medicare Parts B & D - Will you be required to pay the adjusted premium?
Medicare carries pitfalls that most applicants are unaware of, as I have clients that are approaching Medicare application age and clients whose parents are nearing Medicare applications, it is important to note the penalty that can be applied to your premium costs.

Many do not realize that there is a two year look back on income, which could cause higher income applicants to pay a surcharge on the Medicare premium in the initial years.  The results could trigger an increase of 200%, which would significantly impact health insurance costs during retirement.


Planning is essential prior to your application for Medicare Part B and D.  Modified Adjusted Gross Incomes (MAGI) exceeding $85,000 for individuals and $170,000 for married couples will be subject to the increased premiums costs.


To avoid the income surcharge, clients should be aware of certain transactions that are excluded from the calculation. 

If it is necessary to draw additional income prior to Medicare, consider these investments which are not calculated into gross income for surcharge purposes:

  • Roth IRA distributions
  • Roth 401(k) distributions
  • Income drawn from Health Savings accounts
  • Loans taken from a whole life insurance policy

Income that negatively reflects on surcharges includes the selling of a home or receipt of a large cash bonus prior to retirement.


For more in-depth information, the attached link has been added for your convenience:



Advanced planning is recommended if you or a family member is reaching Medicare qualification age.


As always, please contact our offices to schedule an appointment to see how this may affect your personal circumstances.

Thank you all


I would like to take this time to thank my clients and affiliated professionals, for the opportunity to serve you personally or through your business.


The firms' goal, like other professional service firms, is to strive for client satisfaction through performance, communication and professionalism.  Our clients'

satisfaction results in our primary source of new business, through referrals.  Your referrals, both personally and through your business, are appreciated and serve as the cornerstone of our organization. 


Thank you all,

Angela Thomson, CFP (r)
Coastal Financial Planning, Inc.
Like us on Facebook

Our Question this issue is...

Over the last 20 year period, what has the annual average rate of return been, based on a $100,000 investment placed in the stock market?

A. 12.1%

B. 11.2%

C. 10.5%

D. 9.3%


As would be expected, accounts with full equity exposure fared better than those investments split between stocks and bonds, and bonds only.

The historical holding return over the last 20 years has resulted in a gain of 11.2%.

Conversely, a bond only portfolio had a 6.1% return over the same time period, and a portfolio mix of 50/50 bonds and stocks resulted in an

annualized return of 9.1%. 

In the past, planners had used the 50/50 mix, with an assumption that this would generate a larger return of 10% in most portfolios, but the volatility over the years has caused this number to diminish.


So if you answered B, you were correct.


Although the equities portfolios return is very attractive, it is wise to remember the greater the return, the greater the risk.


Many cannot tolerate the swings experienced in the equities market over the years.


Quick Links

Like us on Facebook

Join Our Mailing List

Coastal Financial Planning, Inc. has been creating this newsletter for many years.

I would like your feedback.

Are the contents of the articles of value to you? 


Do you consider information presented in this format worthy of sharing with friends and business associates?


Has the information presented in each newsletter been of any value to your business dealings?


I would love to hear your comments.  


Please feel free to post your input on our
Facebook page.

Like us on Facebook