As our great country gets ready to celebrate Independence Day, we face a series of difficult problems at home. Among them is the persistent issue of retirement readiness. Although paycheck-to-paycheck life is the order of the day for many Americans, it doesn’t have to be. The timeless personal financial principles of debt reduction paired with a robust savings and investment plan through a workplace 401(K) and/or an IRA are alive and well for those who choose it.

Good personal finance is a little like good personal hygiene. It is up to individuals. In other words, it is difficult to legislate. Besides, lawmakers are so busy struggling with internal problems at the Veteran’s Administration, the State Department, Border Patrol, and the IRS that if we wait for Washington to solve problems related to financial literacy, the wait will likely be very long. With the help of your adviser, you are well served to take matters into your own hands.

Meanwhile, geopolitical risk has intensified considerably. The newest threat is from ISIS militants in Iraq while conflicts in Syria and Ukraine remain unresolved. The chaos in Iraq has caused the price of oil to rise and corresponding higher prices at the pump will ultimately cause pain for both US businesses and consumers. Thankfully, an effort to build energy independence is well under way. The bigger threat, of course, is that the violence in the Middle East will somehow be exported to the West.

As we approach the second half of the year, the US economy has likely pulled itself out of a first quarter decline. The stock market has recorded one record after another. The bond market provided additional tailwind, despite warnings of higher interest rates from many analysts and economists. Monetary policy at the Fed remains accommodative, although the Central Bank continues to reduce bond buying by $10 billion per month and is on course to finish the program later this year.

At ASG, we keep a close eye on both portfolio performance and the economic calendar. Stocks, bonds, and cash are the building blocks for an asset allocation model that is customized for age and risk profile. What with the DJIA very close to 17,000, now is a good time for a mid-year review with your adviser. At ASG, your call is always welcome.

Happy summer!

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