“Manage the Markets”

by Catherine Avery

Happy Friday!!!

I don’t know about you, but after the holidays it has been really hard to get back into work mode. I have finally convinced myself that it’s a new year, a new outlook and time to charge forward. We all have the choice of being sucked in by the gloom and doom or finding something positive to look forward to. I do believe that the new administration is certainly doing its best to try to move our country forward. At this time, I do think that everyone is wondering what this new government has in store for us. Today’s newsletter is a peek at some of the positive proposals that Obama and his crew are talking about.

Happy Reading!

Warm regards,

Catherine Maniscalco Avery

 CAIM specializes in creating and managing 

customized and fully diversified investment portfolios for private investors.

203.966.2712  p
203.966.5697  f



What impact will the new Administration have on you and your finances?

On the one hand it’s ‘wait and see’ time. We really don’t know what’s going to get passed in Congress and exactly what’s going to happen yet. And, despite the Fed’s aggressive rate-cutting campaign, some bold programs and $700 billion dollar bailout plan, the financial markets are still stressed and shaky.

On the other hand, a few early proposals made by President Obama suggest that it will not be all gloom and doom. Here are 5 proposals to be aware of:

Temporarily suspend the rule that seniors age 70.5 take the required annual distribution from their retirement accounts. This proposal gives retirement plans and accounts a chance to rebound. It’s an important move – you don’t want to be forced to take money from your retirement plan(s) in a down market. Remember, I have always advised clients to take smaller distributions from their retirement accounts anyway, (and if they can), as it gives the markets time to bounce back.

1/3 of the proposed $825 billion stimulus plan is aimed at tax cuts. This will include a $500/worker and $1,000/ family tax credit. Businesses will also get some breaks to help them grow. Need I say more?
Require companies to automatically enroll their employees in 40(I) Ks and IRAs. Do you know how many people receive these types of plans and ignore them? Especially younger workers? This proposal will aid those who don’t realize, or understand, how interest compounded over 30-40 years adds up, and the importance of investing NOW!

The Fed plans to initiate a program that expands the availability of consumer loans. We have to get consumers purchasing in order to move the economy along. This proposal is an important boost to consumers who have been so tapped out.

The Fed may also expand another program under which it is buying up to $500 billion in mortgage-backed securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae. This is great, especially for first time homebuyers, as it will keep the mortgage rates low!

What to do with your Portfolio?

You need an action plan! But it should be a plan based on careful deliberation and not rash action. Your best bet is to:
Stay with high quality, financially stable companies that pay dividends, have low debt and high cash flow
Keep your debt in check, and try to pay it down, if you can
Make sure you continue to save for your retirement

And that’s the bottom line!

See you next month with more updates and news!

For those of you with questions, feel free to call me at 203.966.2712. Also please visit my website at www.catherineaveryinvest.com

Please pass along this newsletter to friends and family to spread the word!