Broker Check

The Weekly Wealth Report

February 08, 2021

The Week on Wall Street

Stocks notched strong gains last week, paced by a string of solid economic reports and consensus-beating corporate earnings.

The Dow Jones Industrial Average gained 3.89%, while the S&P 500 advanced 4.65%. The Nasdaq Composite index jumped 6.01% for the week. The MSCI EAFE index, which tracks developed overseas stock markets, climbed 1.96%.


What do Ermal Fraze, Thomas Adams, Melitta Bentz, and Stephen Perry all have in common? They are recognized annually on February 11th, along with the likes of the Wright brothers, Thomas Edison, George Washington Carver, and Elisha Otis. On February 11, the United States recognizes National Inventors' Day, a day to salute past and present great inventors. First signed into declaration on February 11, 1983, President Ronald Reagan chose the date because it was Thomas Edison's birthday.

Thanks to inventors, we can safely ride in an elevator, have a well-lit room at the flip of a switch, speak to someone on the other side of the world or efficiently pump lotion from a bottle. Many inventors go their whole life without recognition for their creations while others are household names. Nearly everything around us is the result of someone tinkering in their garage, laboratory, or basement trying to find a solution to a problem.

Some inventions may be happy accidents by an observant person; the microwave oven, penicillin, sticky notes, and bubble wrap may never have made their way into their current use if it were not for sharp or persistent inventors.


Bull Story Remains Intact

As the social media trading frenzy fizzled, investors were able to focus on more fundamental issues, like economic data and a fresh batch of corporate earnings. Pleased by an economy that appeared to be growing stronger, coronavirus cases in decline, and an improving vaccine rollout, investors bought stocks with enthusiasm.

The rally last week was broadly based, with the Energy, Financial, Communication Services, and Technology sectors posting gains.

The stock market’s optimism on an improving economy was seconded by the bond market as the 30-year Treasury rate rose to nearly 2.0% by Friday. When yields rise, bond prices fall. Falling bond prices may indicate that investors are less interested in Treasuries and more interested in other investments that benefit from a stronger economy. Rising yields may also reflect worries that a growing economy may spark inflation that may lead the Fed to rethink its zero-rate policy.

The Inevitable Denouement

It was just two weeks ago that a social media chat forum appeared to contribute to a buying frenzy in a handful of struggling companies, unsettling Wall Street and capturing the nation’s attention.

These stocks staged a broad retreat last week as more was learned about the trading activity.

A similar social media-inspired buying effort was also initiated on silver. But silver prices experienced a modest gain before quickly reversing direction just days later.


When making the decision to enroll in Medicare for the first time, it’s important to understand how enrolling in Medicare will affect your ability to contribute to an HSA.

Health Savings Accounts (HSAs) are tax-advantaged savings accounts for individuals with High-Deductible Health Plans. In order to actively contribute to an HSA, you cannot have any other health coverage, including Medicare. As an HSA accountholder, you have a few options:

Eliminate Contributions and Enroll in Medicare

When you enroll in Medicare, you will have to discontinue making contributions to your HSA or change your contribution amount to zero. You’ll want to do so six months beforehand due to the retroactive coverage of Medicare, which may cause you to incur tax penalties.

Use HSA Funds for Qualified Medical Expenses

Just because you can no longer contribute to your HSA, doesn’t mean you can’t use your accrued savings as intended. You will still be able to withdraw your funds tax-free to help pay for your medical expenses such as deductibles, premiums, copayments, and coinsurance.

Delay Social Security Benefits

You cannot simultaneously collect Social Security and decline Medicare Part A, so if you wish to continue working and contributing to your HSA, you will have to delay applying for social security until you are ready to stop making HSA contributions.

There are many factors in deciding when to make changes to your healthcare upon Medicare eligibility, if you have questions about these or other financial considerations, we’re happy to speak with you about them in more detail.

As always, please let us know if there is anything we can help with along the way or any financial concerns you may have.

Have a great week!