Greetings,

I can't believe we are over half way through the year! We have a couple of fun announcements at Life Planning Partners, Inc. with our newest employee, quarterly market newsletter, and latest blog post!



We are excited to introduce you to our newest team member Christy Lewis! Christy is our new Executive Assistant. She will be working closely with the advisors to help with all insurance related tasks, including gathering policies and helping shop for insurance. She will also be a key support to Krissy and Angie with client services. Christy brings over seven years of experience in the insurance industry, most recently serving as a subject matter expert in the quality department at an insurance agency.

Originally from St. Petersburg, Florida, Christy moved to Jacksonville with her husband after graduating from Florida State University and has been enjoying life here ever since. Outside of work, she loves spending time with friends & family, playing with her dog (Rocco), reading, and traveling whenever she gets the chance.

We look forward to you meeting her! 

The next announcement – we are in process of scheduling the annual shred party. We are waiting for the heat to subside some, and our goal is to have something on the calendar by mid October.

As always thanks for allowing us to have jobs we love. We are happy to answer any questions.

The Flash Crash

Brett Lozowski

What a quarter! That’s all I can say… The financial markets really gave us the full range of emotions from hopelessness and despair to newfound optimism. In just two months, we narrowly avoided an economic catastrophe to rally to new all-time highs.

What happened?

The US stock market (S&P 500) took the ultimate knockout blow plunging nearly 19% from February to April in response to President Trump’s tariff policies. However, like every good fighter, The US stock market got up and got back in the ring.

Just days later a 90 day pause in tariffs caused the US stock market to rally 9.5% in just one day- its best day in nearly 17 years! The fight continued, and two months later financial markets reached new all-time highs.

Despite tariff policy and trade disputes, in the first half of the year, US stocks finished up 6.2%, international stocks (Vanguard total international index) gained a hot 18.2%, and bonds continued to serve as the ballast gaining 3.8%.

I am shocked on how the markets have shaken out. It goes to show how quickly things can change. This goes to show that the disciplined investor who sticks to their asset allocation through thick and thin usually wins. Last quarter was certainly no different.

We are fortunate that financial markets rebounded so quickly and we must remember this is not always the case. Some market pullbacks are short lived and others are long lasting. Most of the time there is light at the end of the tunnel and it often comes when we least expect it. 

The Stoic philosopher Epictetus said "There is only one way to happiness and that is to cease worrying about things which are beyond the power or our will." The cornerstone of financial peace is having a good financial plan to clarify how much risk you can take in your portfolio emotionally and financially. Everyone of our clients have a good financial plan so no matter what the markets do, you will be okay.

If you still find yourself using worry minutes, we are just a phone call away to help you put it all in perspective. Thank you for your trust in our work.

Everything You Need to Know About Your Bonds

By Brett Lozowski

As many of you know we use quite a few individual bonds in your investment portfolio. We buy a wide variety of bonds differing in maturity, tax status, and more based off what makes sense in your financial picture.

What is the purpose of using all these individual bonds and what role do they play in your portfolio?  

Individual bonds provide diversification from the stock market and provide stable income streams for your investment portfolio. As our wise, retired investment manager Tim used to say, “Bonds are the ballast of the portfolio.”

Individual bonds are held to maturity. This means you get back your initial investment (your principal), and you also collect interest payments along the way. The bonds we purchase are very high quality (strong credit ratings), and the majority of the bonds are insured, meaning your principal is protected.

Recently, changes in interest rates negatively affected bond prices which caused them to appear red (at a loss) on your statements. Should you be concerned with these declines in bond prices?

The short answer is no.

Interest rates and bonds have an inverse relationship. If interest rates go up, the value of your current bonds will go down. Likewise, if interest rates go down, the value of your current bonds will go up.

What do the “losses” on your statement mean? The bond price fluctuates with changes in interest rates. The price you see on Fidelity represents what price you would receive if we sold your bond early. Since we never sell your bonds, the price you see on Fidelity is not relevant. When the bond matures, you will get your principal back and you’ve collected all that beautiful interest along the way.

The long and short of this? You can simply ignore the losses or gains showing on individual bonds on your statements! Rest easy knowing that the bonds are doing their job and acting as your safety net along the way.

Why do we use individual bonds as opposed to just using bond funds? Using individual bonds allows us to lock in good interest rates for a longer period of time. With interest rates at near multi decade highs, you’ll be excited that you own these bonds when interest rates start to decline. As the bonds mature, Brett will look at reinvesting or using the proceeds to help fund your cash flow needs.

We use bond funds in addition to bonds for a couple of reasons. Bond funds are easier to sell than individual bonds. The proceeds can be used for cash flow needs or rebalancing. Bond funds come in handy when you have an unexpected expenditure such as a dream car or an opportunity for a once in a lifetime vacation! Bond funds can also allow us to take advantage of the cheaper prices in the stock markets if we see a pullback.

In summary, bonds do their job by funding cash flow needs, adding diversification, and serving as the ballast in your portfolio. I am always happy to chat and answer questions you may have about the bonds in your portfolio!