Page 1 FALL 2014 Stephen L. Roberts, CFP® Stephanie L. Ring Angela C. Fischer, CFP® Economic Update A utumn is a wonderful time of traditions— apple picking, football games, and enjoying the beauty of the changing seasons. Unfortunately, it also seems to be a time when the markets get ’spooked.’ Although October’s market fluctuation is unsettling, we don’t believe the recent volatility is immediate cause for alarm when viewed in the context of historical trends. Moves of this magnitude—both up and down—have taken place during an overall expansion in the economy and favorable period for stocks. Market pullbacks are actually quite common, but the lack of them in recent years has caused investors to be less accustomed to them. Considering this context and the current market environment, we think it is unlikely that recent volatility is an early signal of a recession or bear market. Looking at historical evidence of the S&P 500 Index, volatility has been customary for a bull market:    In the mid-2000’s cycle we saw a similar series of 5-7% pullbacks, never a 10%. It has been three years since we have experienced a 10% pullback; on average we expect one 10% drop per year. In a typical mid-cycle year, stocks experience four 5% pullbacks, and this year (and last) we have only seen one. We believe the current market volatility is being driven by a number of factors: a host of geopolitical issues, including the spread of Ebola; the rise of Islamic State militants in Iraq and Syria; ongoing concerns about the underlying health of the Chinese economy; and most importantly, persistent economic weakness in Europe. Although the geopolitical situation has deteriorated in recent weeks, a number of positive factors in the global economy and U.S economy may offset:       The U.S. economy continues to expand at a pace well above its long-term average, the labor market has created over 2 million jobs in the past year, and the unemployment rate is 5.9%, according to the U.S. Commerce Department and the Bureau of Labor Statistics. While the Federal Reserve will most likely end its bond-purchase program later this year, Fed policymakers have indicated there is no hurry to raise rates, and when they do, rate hikes are likely to be modest. The European Central Bank is preparing to add a much needed dose of monetary stimulus to the European economy, following the results of European-wide bank stress tests later this month. Valuations on the S&P 500 remain near historical averages, and while no longer cheap, remain reasonable given the interest rate and earnings environment. Concerns around global growth have driven oil and gasoline prices sharply lower, which may support consumer spending. The decline in bond yields in 2014 has lowered borrowing costs for corporations, which in turn lower expenses and help profitability. (Continued on next page) Roberts, Ring & Fischer Wealth Management, Inc. www.rrfwealth.com 201 S. Water St. ~ Silverton, OR 97381 (503) 873-3684 Page 2 FALL 2014 Economic Update—(continued) Although pullbacks are unwelcome, they are often a short interruption in the context of a longer-term bull market. Our view remains that the U.S. economy is expanding and the upcoming corporate earnings season is likely to reveal that growth is robust. While the geopolitical issues may spark profit taking, we do not believe they will end the recovery. As you enjoy your autumn traditions, we will continue to watch the U.S. economy, the Fed, and the financial markets. LPL Financial Research maintains its positive stock market view, and believes the bond market is unlikely to do much more than provide a buffer against stock market declines, especially if interest rates rise as expected. Still, we believe a diversified portfolio makes sense to mitigate unforeseen risks. As always, if you have questions, we encourage you to contact us.    When can I retire and how much will I need to meet my goals? What strategies can I utilize to ensure that my wealth transfers to my heirs and is protected from estate taxes? As your financial advocate, we are here to help you answer these questions confidently. Our planning process is not a once in a lifetime event. It is ongoing and evolutionary, taking into account changes throughout your life and the financial decisions you will Imagine every asneed to consider. It is com- pect of your finanprehensive and integrated, capable of addressing a wide cial life organized range of financial circum- and viewable at stances and concerns. We the touch of a will customize your plan with button. Anytime. your objectives, priorities and From anywhere. personal values. So what is the cost of using these additional services? Zero. WealthVision is a sophisticated, state of the art planning tool we offer to our clients free of charge. Have you experienced WealthVision? For those of you who haven’t been introduced to WealthVision, we invite you to experience one of the most valuable financial planning tools we’ve ever used. Imagine every aspect of your financial life organized and viewable at the touch of a button. Anytime. From anywhere. Our complimentary, state of the art financial planning software organizes all of your accounts, assets and information, viewable on your own secure personal financial homepage. You can view your entire financial picture in one simple location without searching through hard copy files or bouncing from one website to the next. Once we have all of your data aggregated, we can run planning projections to help answer questions like:  How can I plan to save for my kids’ college education? Another popular question is, “How secure is this program?” The security of your data is our top priority. WealthVision is equipped with world-class technology, firewalls and encryption services, but beyond that there are additional safeguards to protect users. WealthVision is a non-transactional program – meaning it is impossible to move money in or out of the system. There are no social security numbers, passwords, or account numbers stored on the system. We understand that not everyone is interested in viewing their accounts online—some may not own a home computer. However, these clients have still found a lot of value in using the retirement, and estate planning tools during our annual meetings. Once we have set up your personal profile, we simply revisit the information each year to ensure it is current. Then we can measure the progress we are making toward your goals and implement planning adjustments as needed. Call us today to request a data gathering worksheet so we can get started on creating a personalized profile for you. We look forward to working with you to illustrate how a clear, sophisticated financial plan and investment strategy can simplify your life and give you the time you need to focus on the things that are most important to you.  FALL 2014 Page 3 Is it time for a checkup? Things change. Life happens. As part of your overall financial health, an annual review or “check-up” of your life insurance coverage can help you stay on track with your long term financial goals. People are living longer now than they ever have, and life insurance companies have taken notice. Since the mid 1990s, insurance companies across the nation have begun using new actuarial charts that reflect those longer life spans, which translates to lower life insurance rates. That means that if you bought a policy in the years before the change, your rate may be much higher than it needs to be. During your policy review we will work together with our LPL Insurance Associates team of experts to determine whether or not you need life insurance coverage, if so—how much is needed to adequately cover your needs, and if there is a lower cost alternative in the marketplace today, versus what you currently own. Life insurance is not just about financial planning, but protecting the people and organizations you care about. Life insurance proceeds can provide surviving family members and business partners with the funds to pay for the balance on the mortgage on a home, a child’s future education, a legacy for grandchildren, buying out a partner’s portion of a business or a surviving spouse’s retirement. If you are interested in a full review of your life insurance needs and/or current coverage, please call us to schedule an appointment.  Client Appreciation Party We are pleased that so many of you braved the heat this past August to attend our summer party. Hopefully you walked away with a prize basket or at least enjoyed a relaxing chair massage and some tasty refreshments. We posted some great pictures from the event on our company Facebook page—log on and take a look. We are already looking forward to doing it again next summer! Back by popular demand… Steve’s Fishing Adventures! It’s been a few years since I’ve included this particular column in my “investment” newsletter. But due to multiple requests from various clients, it’s back. I’m not sure if it’s a good thing or not that some of our clients are more interested in reading my fishing stories rather than our wonderful and oh-so-exciting economic news. So last month Debi and I took our annual trip over to Sawyers Landing RV park in Newport. This year’s trip was another successful outing. Multiple family and friends visited and we all feasted on the salmon and crab we caught. (And there’s nothing like searing fresh tuna in a cast iron frying pan right there on the side of the bay.) One of the most unique things that happened this year was one day when we had just put the boat in upriver above the town of Toledo. We were standing on the dock when suddenly, a 10-pound Coho salmon literally jumped out of the water and landed in the middle of the dock about 4 feet from us, flopping all around! I’ve seen a lot of strange things on the water, but this took the cake! There was another fisherman standing there who proceeded to try to grab the fish. This slippery task was harder than one would imagine, but he finally ‘caught’ the fish. We were anxious to head out on the water for some fishing of our own, thinking, “If they’re jumping out of the water at our feet… this was going to be a pretty good day!” Of course, that was the one day we got skunked. We concluded that perhaps we should have just stayed back on the dock—-with our net ready!  FALL 2014 Do you know of anyone who is retiring? Over 10,000 baby boomers are retiring and filing for social security each day. The need for a retirement planning specialist is greater than ever before. If you know of someone who would benefit from our planning services please let us know. We would be happy to send them a brochure describing our firm and set up a free consultation. As a brief side note, there seems to be some misconception over the announcement we made a few years back regarding our account opening minimum. Just to clarify, the minimum only applies to new clients— and it does not apply to your family members. The whole purpose of implementing the new account minimum is to protect the level of service we offer to our existing clients. If we can enhance our relationship Page 4 with you by offering assistance to your loved ones, we are certainly more than happy to do so. Limiting new clients to those with at least $250,000 of investible assets allows us to focus on our goal of providing the highest quality of service to you. In addition, we are continually making improvements to help enhance our service level. In the past year we’ve hired a new employee to join our administrative support team and completed an extensive technology upgrade in our offices. We are excited about the growth our business has experienced over the years and recognize that a large part of our success has been due to your referrals. Thank you—we truly appreciate the trust and confidence you’ve placed in our firm.  The opinions voiced in this material are for general information only and aren’t intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult with your financial advisor prior to investing. All performance referenced is historical and no guarantee of future results. All indices are unmanaged and may not be invested into directly. The economic forecasts set forth in this newsletter may not develop as predicted and there can be no guarantee that strategies promoted will be successful. Investing involves risk including loss of principal. There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk. International investing involves special risks such as currency fluctuation & political instability & may not be suitable for all investors. This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your situation with a qualified tax or legal advisor. 201 S. Water St. Silverton, OR 97381 (503) 873-3684 Address Service Requested Securities and advisory services offered through LPL Financial Registered Investment Advisor Member FINRA/SIPC