Private Client Group

March 31st, 2019

Apple’s new ventures, the retirement savings crisis, and more

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In this week’s Steady Investor, we look at some of the biggest news stories:

Read on to get the details:

Apple Inc.’s Next Chapter Involves TV and Goldman Sachs – Apple’s most recent quarterly earnings report revealed something that keen market observers probably already knew – iPhone sales were starting to slow. Not only are customers keeping iPhones longer, but competitors like Samsung are flexing their muscle in Emerging Markets where sales remain robust. How does Apple respond? Naturally, the company pivots. In a highly anticipated move this week, Apple CEO Tim Cook announced the company would be expanding its reach in entertainment, financial services, news, and videogames. Apple News+ is a $9.99/month subscription that is said to give readers access to more than 300 magazines and newspapers, in which the Wall St. Journal is involved. Apple is also set to launch a credit card in conjunction with Goldman Sachs, one that aims to give customers a commitment to privacy as well as real time cash rewards. But perhaps the biggest unveiling was Apple’s pivot into the TV streaming business, taking on behemoths like Netflix, Amazon, and Disney. Apple is said to be working partnerships with stars like Oprah Winfrey and Steven Spielberg for content, though it is unclear what Apple intends to charge and how they will deliver the service.1 ________________________________________________________________________

5 of the biggest financial mistakes you should avoid!

Are you falling prey to some of the biggest financial mistakes? See for yourself with our guide.

There are common mistakes and habits that can help some investors succeed while others fail. See what are the biggest mistakes investors make and how to avoid them with our guide, “5 Investment Do’s and ‘Don’ts”

If you have $500,000 or more to invest and want to learn more, click on the link below:

Learn About the 5 Do’s and Don’ts of Investing!2

________________________________________________________________________

Could the New Tax Law Actually Hurt Multi-Nationals? The verdict may be “GILTI” as charged. The new tax law no doubt lowers the overall corporate tax rate for corporations, from 35% to 21%. But, there’s a provision in the law known as the Global Intangible Low-Taxed Income tax, or GILTI, that says multi-nationals that pay a foreign tax rate lower than 13.125% must pay a minimum income tax in the U.S. Since many corporations already pay a rate at or higher than 13.125%, many thought they’d be excluded from GILTI. But that’s not turning out to be the case, because Congress did not change rules that force some companies to count U.S. expenses toward foreign operations. In short, these expenses should be offsetting GILTI, but they’re not. The end result is that it may make sense for some companies to move some of these U.S. expenses abroad, which is the exact opposite incentive that the Trump Administration is trying to create.3

Government Report Shows Half of Older Americans Have ZERO in Retirement Savings – it’s a sad reality but also a well-telegraphed one: Americans are grossly underprepared for retirement. A recent government report moved the issue front-and-center again, with fairly staggering statistics that should give every reader pause. By the numbers: Of Americans 55 or older, an eye-opening 48% had nothing saved in a retirement account, like a 401(k) or IRA. We’re not talking low account balances or even a few thousand – we’re talking zero dollars. That’s a problem. To be fair, a decent percentage of these Americans have access to a pension, but the fact that no supplemental dollars are saved anywhere is, in our opinion, ‘not ok.’ While we’re dishing out the unfortunate stats, there’s more: The Employee Benefit Research Institute estimated that 41% of households where the head is between the age of 35 and 64 are probably going to run out of money in retirement. Too many Americans are relying on just Social Security to finance retirement, and we hope the work we do here at Zacks Investment Management can help change that.4

Not saving enough for retirement is a common investing mistake. But it is only one of many, in our view, that investors are making such as changing strategies too often, getting emotional about investing or failing to diversify.

To help you understand these mistakes and what you can do to avoid them, we have created the guide, “5 Investment Do’s and Don’ts.”5

In this guide, we provide our thoughts on what we believe are 5 of the biggest financial mistakes investors should avoid, while also examining 5 financial habits that we think can help you invest successfully and with confidence. If you have $500,000 or more to invest and want to learn more, click on the link below:

Disclosure

1 The Wall Street Journal, March 25, 2018. https://www.wsj.com/articles/the-apple-card-is-here-with-cash-back-and-privacy-promises-11553541513?mod=djem10point
2 ZIM may amend or rescind the “5 Investment Do’s and Don’ts” guide for any reason and at ZIM’s discretion.
3 The Wall Street Journal, March 27, 2019. https://www.wsj.com/articles/tax-changes-hit-overseas-profits-of-some-u-s-companies-11553679000?mod=djem10point
4 Bloomberg, March 26, 2019. https://www.bloomberg.com/news/articles/2019-03-26/almost-half-of-older-americans-have-zero-in-retirement-savings?mod=djem10point
5 ZIM may amend or rescind the “5 Investment Do’s and Don’ts” guide for any reason and at ZIM’s discretion.

DISCLOSURE

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.

Zacks Investment Management, Inc. is a wholly-owned subsidiary of Zacks Investment Research. Zacks Investment Management is an independent Registered Investment Advisory firm and acts as an investment manager for individuals and institutions. Zacks Investment Research is a provider of earnings data and other financial data to institutions and to individuals.

This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. Do not act or rely upon the information and advice given in this publication without seeking the services of competent and professional legal, tax, or accounting counsel. Publication and distribution of this article is not intended to create, and the information contained herein does not constitute, an attorney-client relationship. No recommendation or advice is being given as to whether any investment or strategy is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole.

Any projections, targets, or estimates in this report are forward looking statements and are based on the firm’s research, analysis, and assumptions. Due to rapidly changing market conditions and the complexity of investment decisions, supplemental information and other sources may be required to make informed investment decisions based on your individual investment objectives and suitability specifications. All expressions of opinions are subject to change without notice. Clients should seek financial advice regarding the appropriateness of investing in any security or investment strategy discussed in this presentation.

Certain economic and market information contained herein has been obtained from published sources prepared by other parties. Zacks Investment Management does not assume any responsibility for the accuracy or completeness of such information. Further, no third party has assumed responsibility for independently verifying the information contained herein and accordingly no such persons make any representations with respect to the accuracy, completeness or reasonableness of the information provided herein. Unless otherwise indicated, market analysis and conclusions are based upon opinions or assumptions that Zacks Investment Management considers to reasonable. Any investment inherently involves a high degree of risk, beyond any specific risks discussed herein.
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