NEWSLETTER. Winter 2016 In this issue... Welcome

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1 NEWSLETTER Winter 2016 In this issue... Welcome Welcome to another edition of the McBrearty Capital Management newsletter. We hope you enjoy this edition! Happy New Year! 2015 had a lot of activity in politics, socioeconomic issues, weather, religion, and nuclear weapons. The overall stock market was quite volatile at times, traveling over 10,000 points in just one week, yet ending the year essentially flat. Commodities were by far the worst performing asset class. As you can imagine, economic predictions for 2016 are all across the board. > Jim s latest economic update covering 2016 predictions, crude oil, and asset class returns. > A 2016 first quarter financial Checklist > Looking for an easier way to deposit checks? Learn how to deposit checks using Schwab Mobile Deposit. > 10 early signs and symptoms for Alzheimer s > Senior Scams > Quick tips when shopping for Health Insurance

2 > Economic Update Market Trends Sam Stovall, Managing Director for U.S. Equity Strategy of S&P Capital IQ s Global Markets Intelligence group, stated on Bloomberg that over a span of 50 years, when markets have been flat one year, the average market return in the following year is 13%. Stovall also stated that only once in 50 years did a market remain flat for a second year. However, Stovall expects volatility in the beginning of an interest rate tightening cycle has already shown interest rates rising, little inflation, slower economic growth, violent weather swings, unrest in the Middle East, and concerns about nuclear weapons in North Korea. Oil Markets Dr. David Kelly, Chief Global Strategist and Head of the Global Market Insights Strategy Team for J.P. Morgan Funds, points out in the chart below global oil consumption has not slowed. Oil prices are low because of the high levels of supply. He stated in a conference call on January 6, 2016 that oil prices are not an economic predictor.

3 Asset Class Returns The JP Morgan chart shown above displays the returns over the last 15 years by asset class. In 2015 the worst category was commodities, which include oil, gold, etc. The runner up for worst asset class returns was emerging markets. China, which is the second largest economy, will see continuing growth but at a slower pace. Developed Markets were flat in 2015, yet Dr. David Kelly believes the best investment opportunities in 2016 are in Europe. Many economists believe India is the next China. While China s growth rate is expected to slow the International Monetary Fund is forecasting India s growth rate will rise to 7.7% by Real Estate Investment Trusts have been recovering from the mortgage collapse of The chart topper for asset class returns in 2015 was REIT s. Large caps were the second best performing asset class. REIT s should do well again in 2016, but we believe other asset classes have more potential. Notice that a diverse portfolio had greater returns and less volatility over this tumultuous 15 year period than large caps. Your portfolio is unique to you. We tailor your portfolio based on your personal risk tolerance and specific needs.

4 > Financial Checklist A financial To-Do List for the first quarter File Your Tax Return The IRS officially begins accepting tax returns as early as January 19th. Filing early not only helps taxpayers get their refunds as quickly as possible, but it s the best defense against tax related identity theft. Tax returns are due April 18th this year. Set Financial and Personal Goals Many people establish New Year s resolutions this time of year. We recommend setting Financial goals in January. Some examples might be to maximize your contribution to your Roth IRA in 2016, or to save 20% of your income over the next 12 months, or to pay off debt by the year end. Review Designated Beneficiaries IRAs and insurance policies have designated primary and contingent beneficiaries. This is a great time to review and update them with any changes. Strengthen Online Passwords If you have any weak or duplicate passwords anywhere, change them as soon as possible using a capital letter, number, and a symbol. Finish Funding for 2015 Tax Year You have until April 18, 2016 to fund your traditional and Roth IRAs for Now is also a good time to fund your Health Savings Account (HSA). Start Tracking Daily Expenses Just as we are encouraged to write down everything we eat when we are trying to lose weight, writing down everything we purchase can help cut back spending. Try keeping a notebook in your car or purse and write down everything you buy for one month. You may be surprised to see how quickly the small purchases add up!

5 Schwab Mobile Deposit Rachel s Recommended Read Deposit checks wherever you are with Schwab s mobile check deposit service. Make deposits to your eligible Schwab Bank or Schwab brokerage and IRA accounts by simply taking pictures of your checks with your compatible iphone, ipad, or Android Smartphone. Mobile deposits submitted before 4pm local time within the US will be processed the same business day. Apply for Schwab Mobile Deposit at the Schwab Alliance Website CustomerCenterLogin.aspx?&kc=y&sim=y File and Suspend Strategy Schwab Security For an extra layer of security for your Charles Schwab accounts, consider adding a verbal password that will be required each time you call Schwab. Charles Schwab also offers a free security token to make online logins even more secure. To request a security token or to setup a verbal password, you may call Charles Schwab at Last November s budget deal eliminated the file and suspend strategy for Social Security, reducing possible benefits by as much as $67,000 for those planning on utilizing this strategy. If you are between ages 62 and 69, this may affect you. Feel free to contact our office to discuss this matter further. Follow us on Facebook to see the latest financial news, upcoming shred dates, and any available Lady Vols tickets.

6 > Alzheimer s According to the Alzheimer s Association, 5.3 million Americans of all ages had Alzeheimer s disease in Someone in the United States develops the disease every 67 seconds. Alzheimer s disease is the 6th leading cause of death in the United States. Awareness 10 Early Signs and Symptoms of Alzheimer s 1. Memory Loss that disrupts daily life 2. Challenges in planning or solving problems 3. Difficulty completing familiar tasks at home, at work, or at leisure 4. Confusion with time or place 5. Trouble understanding visual images and spatial relationships 6. New problems with words in speaking or writing 7. Misplacing things and losing the ability to retrace steps 8. Decreased or poor judgement 9. Withdrawal from work or social activities 10. Changes in mood and personality For more information visit Pointers for Health Insurance Enroll On-Time: If you are insured through your job or buy it yourself open enrollment starts November 1, 2015 and ends January 31, Do Not Auto Renew: Premiums change, so what worked last year may not be the best option for you this year. Align your health care plan with your current health care needs. Be Wary of Low Cost Plans: Low Cost plans often come with high deductibles. Low cost plans for someone with a chronic disease or a need for expensive medication may not be the best choice. Know Your Providers: Stick with In-Network providers whenever possible to reduce high costs. Sign Up Right: Sign up for Medicare Part A right before or after you turn 65 even if you get insurance through an employer. There s no premium for Medicare Part A, and it covers hospital inpatient care.

7 Financial elder abuse is a growing crime. Fraudsters are defrauding elders and exploiting them to other fraudsters because they seem to be an easy target. According to the Federal Trade Commission, elder fraud complaints to its offices are up by 47% in spite of the fact that many elderly victims do not report fraud. Elders are hesitant to report fraud because they feel ashamed, or fear that others may feel they are not able to care for themselves financially. > Senior Scams The most common financial scams targeting seniors according to the National Council on Aging are: Medicare/Health Insurance Fraud: Scammers may pose as a Medicare representative to steal personal information. Counterfeit Prescription Drugs: Online counterfeit prescription drugs offered at a discount. Funeral & Cemetery Scams: Scammers may show up at a funeral claiming the deceased has outstanding debts. Telemarketing: The scams are hard to trace because they do not have a paper trail. The scammer may state that a family member or friend was in an accident and needs money, or solicit money for a fake charity (often after a natural disaster). Internet Fraud: Some elders are less adept when using the internet making them easier targets for internet scams. Pop-up browsers may look like anti-virus software prompting the user to download, which in turn will be at a cost, or install a virus which may obtain their personal information. Sweepstakes/Lottery Scams: Scammer may state a lottery prize has been won. Then they send a fake check that the victim may deposit allowing the scammers to collect fees from their accounts until the check is rejected. The Grandparent Scam: Fraudsters place a call pretending to be a relative or grandchild stating they need financial help. There are preventative measures you can take in order to prevent elder fraud. You can opt out of commercial solicitations up to five years at a time at dmachoice.org. Nomorobo is a free robocall interception service that is available to certain VoIP service. You can check availability at nomorobo.com. The Adult Protective Services offers a 24/7 hotline at if you suspect you may be a victim.

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