If you’re wondering how the S&P 500 may react to the latest quantitative easing program, you’ll be interested in our first article this week. It features a graph illustrating the market reaction to similar programs since 2009.  Next we talk about wealth accumulation using an interesting study that shows savings to be the biggest factor. Our third article relates to Social Security and what strategies you can use to maximize your benefits.  Finally, we wrap up with an article on the importance of financial literacy and how we can support it.

The Market And Quantitative Easing – Here is a snapshot of how the S&P 500 Index has responded to actions taken by the Federal Reserve since 2009.  As expected, the Fed announced a new Quantitative Easing Program last week (QE3).  Under this program, the Fed will be purchasing about $40 billion in mortgage-backed securities each month to keep interest rates low and drive up asset prices, including those of the stock market. http://advisorperspectives.com/dshort/commentaries/QE-Update-Phil-Gose-120914.php

Savings Have The Biggest Impact On Wealth Accumulation – According to a study by the Putnam Institute, increasing your savings rate has a much bigger impact on wealth accumulation than fund performance. This is why we focus not just on investments but on a client’s savings or withdrawal rate when we help develop a financial plan.  http://www.reuters.com/article/2012/09/13/us-column-investing-saft-idUSBRE88C10S20120913

Forty-Two Social Security “Secrets” All Baby Boomers And Millions Of Current Recipients Need To Know – There are many strategies to maximize your social security benefits.  It’s almost as complex as the Federal Income Tax Code.  Here is a list of 42 items published in Forbes magazine that can benefit you.  We help clients evaluate what is appropriate in their particular situation. http://www.forbes.com/sites/kotlikoff/2012/07/03/42-social-security-secrets-all-baby-boomers-and-millions-of-current-recipients-need-to-know/

Can Education Solve Financial Illiteracy? – Here is an excellent article in Barron’s regarding financial literacy.  Most Americans are unprepared to manage their financial futures.  At Day & Ennis, we will be participating in a financial literacy program sponsored by the Georgia Society of CPAs to begin educating kids in Middle School about personal finance. http://online.barrons.com/article/SB50001424053111904819604577643522832182262.html?mod=djembwr_h

We hope you enjoy reading these articles along with us and that you find them informative.  Please forward this to your friends and family.

John R. Day and Bill W. Ennis