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Dorion-Gray Capital Management® Weekly Commentary August 22, 2016

| August 22, 2016
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THE MARKETS...

After stocks edged higher earlier in the week, declines in utility shares led a slight market dip Friday. Volume was low as investors weighed the odds of a rate increase by December. For the week, the Dow rose 0.02 percent to close at 18,552.57. The S&P gained 0.06 percent to finish at 2,183.87, and the NASDAQ climbed 0.10 percent to end the week at 5,238.38.

Not One Penny –

Of the households in the United States headed by a currently employed individual, (i.e., a “working” household) 44 percent do not have any money invested on a pre-tax basis in a defined contribution plan, e.g., a 401(k) retirement plan (source: Government Accountability Office, BTN Research).

Remove the Cap –

Earnings up to $118,500 in 2016 are subject to payroll taxes. An estimated $180 billion annually in additional payroll taxes would be collected over the next decade if the $118,500 cap was eliminated (source: Tax Foundation, BTN Research).

Greenback Power -

Ninety percent of all global trades, including transactions that do not involve an American buyer or seller, are conducted in U.S. dollars (source: Morgan Stanley Investment Management, BTN Research).

WEEKLY FOCUS – In Sickness, in Health, in Retirement

A healthy marriage takes lots of communication, consideration and compromise. A comfortable, satisfying retirement for both spouses requires the same efforts. Yet a 2013 study from Hearts & Wallets found only 38 percent of couples actively work on their retirement strategy together. This can result in false assumptions and unpleasant surprises in the future.

That’s why joint retirement discussions and planning should start early. Initial topics might include what each spouse plans to do in retirement, and where and how they would like to live. Do they hope to maintain their current lifestyle, or could they be happy downsizing? How much travel do they envision? Will they need to assist other family members? Will they retire at the same time? Once they agree on their goals, they can estimate how much income they’ll need to achieve them – taking inflation, particularly in healthcare costs, into account.

As they form a plan and begin building the resources needed, it’s important each spouse considers how their decisions will impact their future together and individually. For instance, if the higher income spouse retires early, their Social Security payments and their partner’s spousal benefits can be reduced dramatically. And should they pass away, their partner’s survivor benefits will be lower permanently.

If offered a choice between a lump-sum distribution from one spouse’s retirement plan and monthly checks, the couple should weigh the advantages and disadvantages of both alternatives. A guaranteed income offers security, but investing the lump sum themselves may provide greater growth potential. However, they also run the risk of possible loss from a bad market, especially if they may not have time to recoup losses.

If a pension is involved, the couple should look at all the options, which could include an early buyout; rolling it over to an IRA; or monthly benefits during the employee’s lifetime, for a certain period of time or over both spouse’s lifetimes. The employee will usually receive a higher monthly benefit if they choose a single-life option. But this could be very detrimental to a lower income spouse if the employee dies at a young age.

Our retirement planning process encourages frank discussion between you and your spouse and helps you build a plan you can both feel good about. Call our office to schedule an appointment to talk about what each of you wants in your retirement – and how you can get there together.

The Dorion-Gray Team

Securities offered through Securities America, Inc., Member FINRA/SIPC. Advisory services offered through Securities America Advisors, Inc. a Registered Investment Advisory Firm. Dorion-Gray Retirement Planning is a trade name of Dorion-Gray Financial Services, Inc. located at 2602 IL Route 176, Crystal Lake, IL 60014. Dorion-Gray and the Securities America companies are separate, unaffiliated entities.

Diversification seeks to reduce the volatility of a portfolio by investing in a variety of asset classes. Neither asset allocation nor diversification guarantee against market loss or greater or more consistent returns.

© 2013. Dorion-Gray Financial Services, Inc.

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