Broker Check

The RFG Weekly Wealth Report

April 15, 2019

Stocks broke out of a narrow range on Friday following news that two major banks grew their bottom line in the first quarter. For the week, the S&P 500 rose 0.79%; the Nasdaq Composite, 0.91%. The Dow Jones Industrial Average improved 0.50%. Turning to overseas stocks, the MSCI EAFE index declined 0.09%.


In 2004, the U.S. Senate passed Resolution 316, recognizing April as National Financial Literacy Month to raise public awareness about the importance of personal financial education in the U.S. and the serious consequences that may result from a lack of understanding about personal finances. 

Programs and resources are available through Federal and State agencies in addition to credit unions, schools, non-profits, and businesses in observance of the month to increase consumer awareness and encourage communities to participate in the celebration.   


The market spent much of the week in a lull as investors waited for earnings season to begin. Wall Street is paying close attention to both guidance and profit margins. 

Big Banks Post Solid Results 

Friday, Wells Fargo and JPMorgan Chase both reported Q1 profit growth, and JPMorgan Chase announced record revenue. 

This was welcome news. Analysts have tempered some of their expectations entering this earnings season, recognizing that slowing global growth, tariffs, and dollar strength may be affecting corporate profits. The dollar rallied 6.2% in Q1. 

Inflation Picks Up

The Consumer Price Index rose 0.4% in March, the most in 14 months. This matched the consensus forecast of economists polled by MarketWatch, who believed rising gas prices would affect the number. 

Even with this March jump, annual inflation remained relatively tame at 1.9%. 

What's Ahead

Note that U.S. stock and bond markets will be closed on Good Friday (April 19).    



The Super Rich (those with a net worth of $500 million or more) who have family offices typically engage a sizable lineup of professional advisors to help them create and implement financial plans. To help ensure those plans are both state-of-the-art as well as in line with their needs and wants, many of them regularly "stress test" these plans. 

Here's why you should join them in that effort - even if you're not nearly as wealthy. 

Ask "What if?" 

At heart, stress testing is when you ask, "What if ...?" about a variety of areas of a financial plan you have or are considering. When it comes to estate planning, for instance, a wealthy individual might ask questions like:

• What will actually happen to my assets when I pass on?

• How will my family be affected, precisely?

• Who will be tracking the hard assets such as artwork and jewelry to make sure they go to the designated heirs - as opposed to vanishing?

• Who is going to make sure my estate plan is being executed as it's supposed to be?

To be effective and informative, stress testing should be done in a systematic manner. While there are some variations, the basic process starts by determining your goals. Your goals, any problems to be addressed and opportunities to benefit should be the driving forces behind the financial and legal solutions you employ. 

The end result of the process: recommendations. Based on those recommendations, there are five courses of action to consider taking:

Stay the course - solutions are on target and of high quality.

Choose different solutions -  financial techniques and products are not going to achieve the desired results.

Modify the approach - solutions can be made more powerful with only slight modifications.

Choose a different professional - solutions are appropriate but the professionals involved are not up to the task of implementing them, switch to more capable and/or cost-effective experts.

Continue stress testing - the stress test process should continue throughout your life to ensure the plan is constantly up to date and effective. 

Frequently, stress tests uncover flaws in financial plans as well as better ways to achieve desired outcomes. For those reasons, stress tests typically benefit a great number of people who want to ensure financial success.

As always, please contact my office with any questions or financial concerns you may have.

Have a great week!