Click below to read our June 2021 Blog edition.

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HOSPITALS - Between 3/01/20 and 6/30/20, American hospitals lost $51 billion per month of revenue due to canceled and foregone medical services. The Mayo Clinic furloughed or cut the hours of 29,500 of its 70,000 employees in 2020 or 42% of their workforce (source: American Hospital Association, Mayo Clinic). 

WEAR A MASK - Flu cases have dropped dramatically during the pandemic. The number of Americans testing positive for the flu during the 2020-2021 flu season was the lowest number recorded in 25 years (source: CDC).  

NOT IN THE OFFICE - Although only 20% of American employees were “working from home” (WFH) before the pandemic, 71% were WFH by December 2020 and 54% want to continue to WFH after the pandemic is contained. As a result of the change to WFH, the demand for office space is falling, e.g., vacant office space in Manhattan (New York City) is at its highest level in 30 years (source: Pew Research Center).   

REAL ESTATE - The 2020 pandemic caused thousands of home sellers to pull their homes off the market, fearful of strangers entering their homes during the crisis. In March 2020 at the start of the pandemic, 1.49 million existing homes were on the market for sale. By March 2021, just 1.05 million homes were on the market. With a smaller supply, home prices soared. The median sales price of existing homes sold rose from $280,700 in March 2020 to $350,300 in May 2021, an increase of +25% in 14 months (source: Nat’l Association of Realtors).   

AIR QUALITY - The lockdown of economies around the world beginning in March 2020 reduced auto, truck, and airplane emissions. 84% of nations surveyed reported improvement in their overall air quality in 2020 when compared to 2019. Nitrogen dioxide, the gas released in the air from the burning of fuel, declined 26% in the USA during 2020 when compared 2019’s level (source: IQAir’s 2020 World Air Quality Report, ScienceDirect).  

MENTAL HEALTH - Since the start of the pandemic in March 2020, 52% of American employees report having trouble sleeping at night and 42% have suffered anxiety or depression. The Federal Communications Commission (FCC) adopted rules in July 2020 to establish a nationwide “988” hotline for suicide prevention and for individuals experiencing mental health crises by July 2022 (source: FCC).   

FEWER BABIES - In spite of being on lockdown with our spouses/partners, the number of US births fell in 2020 to 3.60 million births, the 12th declining year of births in the last 13 years (source: CDC).  

STRESSED OUT AND LONELY - Alcohol sales nationwide increased by +34% during the 2nd quarter 2020 (i.e., April-May-June) compared to sales from the 2nd quarter 2019. Hospital admissions for cirrhosis and alcoholic hepatitis were up +30% in 2020 compared to 2019 (source: Annals of Internal Medicine).  

AT THE POOL - American cities do not have enough lifeguards to service pools nationwide, e.g., Austin, TX is short 80% of its 750-lifeguard goal for the summer of 2021. The pandemic shutdown put a freeze on training and certification programs required for lifeguards (source: American Lifeguard Association).  

NO ZOOM FOR ME - 40% of teachers with 21-30 years of experience said they were considering early retirement or quitting the profession completely (source: National Education Association, August 2020).  

The chart below illustrates the comparative performance of World Markets since February 3, 2020, the start of the current COVID-19 recession thru June 21, 2021. By aligning on the same day and using a log scale vertical axis, we get an excellent visualization of the relative performance. We've indexed each of the eight to 800 on the February 3rd start date. The callout in the lower right corner shows the percent change from the start date to the latest weekly close. Three of the eight world markets are in positive territory as of June 21st – The U.S. (S&P500), England (FTSE 100), and Japan (Nikkei 225). Of the five remaining, all are in an upward trend, except China (Shanghai) and Hong Kong (Hang Seng). Even though German (DAXX), French (CAC 40), and India (BSE SENSEX) markets are in negative territory since February 3rd, they have recently turned to an upward trend.  

Are you getting ready to retire or are you already there? How are you doing with shifting gears into a new mindset? We are creatures of habit and this change in cash flow can provide a real jolt to our psyche. So often we see clients who are afraid to spend money in retirement even though our scenarios show no need for the level of concern they may be feeling. 

No doubt there is a need to find balance between spending and savings at all points in our lives. Retirement is that specific time when we actually may experience three phases in our spending: the Go-Go years, the Slow-Go years, and the No-Go years. Balancing these phases with a more fixed income and the distribution of investable assets is key. This article provides some key insights that may help in this transition. 

After saving up for decades to retire, many Americans are excited to finally stop working and enjoy their free time.

Yet for some, switching to a spending mindset after being so focused on saving can be a difficult transition.

“There’s a lot of unknowns and if there hasn’t been detailed planning or a high-level overview, someone might enter retirement with a lot of stress and anxiety,” said Anjali Jariwala, certified financial planner, CPA and founder of FIT Advisors in Torrance, California.

Many retirees don’t want to spend down all their assets. Instead, they want to preserve or even grow them during retirement. On average, nearly 47% said they plan to spend none or just a small portion of their accounts, according to an April study from the Employee Benefit Research Institute. The group surveyed 2,000 households aged 65 to 72 with less than $1 million in financial assets.

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Oftentimes financial advisors are on the front line when it comes to looking out for our client’s cognitive decline. We (Alexander Financial Planning) also do an assessment with our clients periodically to check in on this very issue. This article does a great job of pointing out some of the signs and some steps that can be taken to help in this area.  

For baby boomers who manage their own nest eggs, a risk is looming that has nothing to do with stock prices or interest rates.

The risk is cognitive decline, which can rob them of their judgment, often without much warning. One big mistake—or a series of smaller ones—can go unnoticed by loved ones, and potentially ravage a lifetime of hard-earned savings.

To mitigate these risks, there are things baby boomers and others can do now to prepare for any problems. In addition, big do-it-yourself investing and trading venues like Vanguard Group, Fidelity Investments and Charles Schwab Corp. are strengthening some of the ways they detect possible signs of decline. Among other things, all three firms check for clients’ difficulty navigating security protocols or need for frequent password resets. In such cases, a designated family member might be informed.

Vanguard also checks client-call recordings for keywords—such as “confused” and “dementia”—that might signal trouble.

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There continues to be research done on the connection between human behavior with our relationship to money. This article may be helpful as we come out from under our Covid-19 rock and dust off our credit cards. 

It’s been known for decades that credit cards encourage spending. But why that happens still isn’t entirely clear. New research offers some fresh insight into the causes—and how consumers might be manipulated in an increasingly cashless society.

Research on credit-card spending has tended toward the explanation that delaying payment removes a barrier to purchases in shoppers’ minds. A study published in February in Scientific Reports found evidence of another kind of trigger. Differences it found in brain activity between shoppers planning to use a credit card and those planning to buy with cash indicate that buying on credit doesn’t just ease shoppers’ inhibitions, it actively encourages purchases, the researchers say. 

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