• ­MidAmerica Financial Resources Presents:

     

    WEEKLY ECONOMIC UPDATE

     

     

     

    WEEKLYQUOTE

     

    “Chance favors the prepared mind.”

     

    - Louis Pasteur

     

     

    WEEKLYTIP

     

    When a single parent is ill or injured and cannot work, a family can face a major financial crisis. Single parents should consider disability insurance in light of that risk.

     

    WEEKLYRIDDLE

     

    Three women leave work with only one umbrella to share between them. They all try to fit under the one umbrella as they walk to a cafe. When they reach the cafe, none of them are the least bit wet. Why?

     

     

    Lastweek’sriddle:

    What three letters can you use to spell out a word meaning “enemy?”

    Lastweek’sanswer:

    F, O, E.

     

     

     

     

    August 15, 2016

     

    RETAIL SALES WEAKEN

    July was the first month since March without a gain in U.S. retail purchases. The Census Bureau’s latest report showed retail sales were flat last month, a disappointment in the wake of June’s 0.8% climb. Car and truck sales advanced 1.1% during July, but, minus auto buying, retail sales were actually down 0.3% for the month.1

     

    HOUSEHOLD SENTIMENT INDEX IMPROVES

    The University of Michigan’s monthly consumer sentiment index rose to 90.4 last week in its preliminary August edition. It had ended July at a mark of 90.0. A consensus forecast of economists at Briefing.com had projected a 90.2 reading.1,2

     

    WHOLESALE INFLATION RETREATS

    The federal government’s Producer Price Index moved 0.4% lower in July as declining energy costs lessened inflation pressure. The core PPI fell 0.3%. In June, the headline PPI rose 0.5%; the core PPI, 0.4%.1,2

     

    OIL RALLIES, NASDAQ CLOSES AT RECORD HIGH

    August 8-12 was oil’s best week since early April: WTI crude settled at $44.67 on the NYMEX Friday after futures ascended 6.4% in five days. A 0.23% weekly gain led the Nasdaq Composite to a record close of 5,232.89 Friday. History was also made Thursday when the Nasdaq, S&P 500, and Dow Jones Industrial Average each settled at all-time highs – the first time that had happened since 1999. The Dow advanced 0.18% for the week; the S&P, 0.05%. The Dow settled Friday at 18,576.47; the S&P, at 2,184.05.1,3

     

    THIS WEEK: Sysco announces earnings on Monday. On Tuesday, the July CPI arrives, plus reports on July building permits, groundbreaking and industrial output, and earnings from Advance Auto Parts, Cree, Dick’s Sporting Goods, Home Depot, Popeye’s, TJX Companies, and Urban Outfitters. Wednesday, Wall Street considers the minutes from the July Federal Reserve policy meeting and earnings announcements from Agilent, American Eagle Outfitters, Analog Devices, Cisco, L Brands, Lowe’s, NetApp, NetEase, Staples, and Target. A new initial claims report appears Thursday, along with the Conference Board’s latest leading indicators index, and earnings from America’s Car-Mart, Bon-Ton Stores, Gap, Hormel Foods, Perry Ellis, Ross Stores, Stage Stores, Toro, and Walmart. On Friday, Deere & Co., Estee Lauder, Foot Locker, Stein Mart, and Tuesday Morning present earnings.

     

    % CHANGE

    Y-T-D

    1-YR CHG

    5-YR AVG

    10-YR AVG

    DJIA

    6.61

    6.75

    12.97

    6.75

    NASDAQ

    4.50

    3.74

    21.73

    15.43

    S&P 500

    6.85

    4.70

    17.06

    7.24

    REAL YIELD

    8/12 RATE

    1 YR AGO

    5 YRS AGO

    10 YRS AGO

    10 YR TIPS

    0.07%

    0.58%

    0.06%

    2.33%


    Sources: wsj.com, bigcharts.com, treasury.gov - 8/12/163,4,5,6

    Indices are unmanaged, do not incur fees or expenses, and cannot be invested into directly. These returns do not include dividends. 10-year TIPS real yield = projected return at maturity given expected inflation.

     

     

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    Securities and advisory services offered through National Planning Corporation (NPC), Member FINRA/SIPC, a Registered Investment Adviser.
    MidAmerica Financial Resources and Malan Financial Group are separate and unrelated companies to NPC.

    This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment. The Dow Jones Industrial Average is a price-weighted index of 30 actively traded blue-chip stocks. The NASDAQ Composite Index is an unmanaged, market-weighted index of all over-the-counter common stocks traded on the National Association of Securities Dealers Automated Quotation System. The Standard & Poor's 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. It is not possible to invest directly in an index. NYSE Group, Inc. (NYSE:NYX) operates two securities exchanges: the New York Stock Exchange (the “NYSE”) and NYSE Arca (formerly known as the Archipelago Exchange, or ArcaEx®, and the Pacific Exchange). NYSE Group is a leading provider of securities listing, trading and market data products and services. The New York Mercantile Exchange, Inc. (NYMEX) is the world's largest physical commodity futures exchange and the preeminent trading forum for energy and precious metals, with trading conducted through two divisions – the NYMEX Division, home to the energy, platinum, and palladium markets, and the COMEX Division, on which all other metals trade. Additional risks are associated with international investing, such as currency fluctuations, political and economic instability and differences in accounting standards. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. Past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested. All economic and performance data is historical and not indicative of future results. Market indices discussed are unmanaged. Investors cannot invest in unmanaged indices. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional.

    Citations.

    1 - thestreet.com/story/13674220/1/stocks-close-mixed-as-crude-enjoys-best-weekly-gain-since-april.html [8/12/16]

    2 - briefing.com/investor/calendars/economic/2016/08/08-12 [8/12/16]

    3 - markets.wsj.com/us [8/12/16]

    4 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F12%2F15&x=0&y=0 [8/12/16]

    4 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F12%2F15&x=0&y=0 [8/12/16]

    4 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F12%2F15&x=0&y=0 [8/12/16]

    4 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F12%2F11&x=0&y=0 [8/12/16]

    4 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F12%2F11&x=0&y=0 [8/12/16]

    4 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F12%2F11&x=0&y=0 [8/12/16]

    4 - bigcharts.marketwatch.com/historical/default.asp?symb=DJIA&closeDate=8%2F11%2F06&x=0&y=0 [8/12/16]

    4 - bigcharts.marketwatch.com/historical/default.asp?symb=COMP&closeDate=8%2F11%2F06&x=0&y=0 [8/12/16]

    4 - bigcharts.marketwatch.com/historical/default.asp?symb=SPX&closeDate=8%2F11%2F06&x=0&y=0 [8/12/16]

    5 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyield [8/12/16]

    6 - treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=realyieldAll [8/12/16]

     

     

  • Managing Drug Costs

     

    How can households meet the challenge?   

     

    Provided by MidAmerica Financial Resources

     

     

    Are prescription drug costs burdening your finances? This problem is far too common today. Consider the price tag of some of the drugs used to treat arthritis, hepatitis C, cancer, and multiple sclerosis. A Kaiser Family Foundation study notes that the cost of medications such as Zytiga, Humira, Gleevec, and Revlimid may run anywhere from $4,000-12,000 a year. For the record, Medicare Part D’s catastrophic coverage threshold for prescription medications is currently $4,850 per year (up from $4,700 in 2015).1,2  

     

    How can a household try to manage drug costs? There are some approaches that may help.

      

    Shop around & compare Part D plans annually. This year, the Part D recipients who were automatically re-enrolled in their plans faced monthly premiums averaging $41.46, a 13% rise from $36.38 in 2015. As you shop, keep in mind that plans with smaller premiums may have higher out-of-pocket costs. Some plans also limit monthly doses of certain drugs in their coverage, or request patients to try less costly drugs before branded drugs can be prescribed.3

        

    Consider generics. Generic drugs represent nearly 90% of prescriptions written today and can cost 80-90% less than branded therapies. Sometimes generic alternatives are not available, but often they are.3

            

    Stay within the plan network. If you do, you’ll discover that 85% of Part D plans offer preferred in-network pharmacies. If you go out of the network for non-preferred medications, your cost for those medications may rise. That said, shopping around at different pharmacies may yield some savings. Pharmacies located inside big-box retailers sometimes provide amazing savings on commonly prescribed medications.3

     

    Ask a compounding pharmacy if it can make a medication for you. In such an instance, the savings could be substantial.

     

    Ask your doctor if you can reduce your dose. If that is doable, it could mean monthly savings.

     

    Use a pill cutter. Typically, you pay for drugs by the pill rather than the pill strength. A pill cutter (which you can usually pick up for less than $10) can be an avenue to savings. This is true for many prescription drugs.4

     

    Try GoodRx. This app is free for your phone, and you can also visit GoodRx.com on your PC. GoodRx will give you a coupon so you can buy a prescription drug at the price it has negotiated with particular pharmacies in your area. In some cases, the discounts can be as large as 90%.4

     

    Health Savings Accounts (HSAs) & Roth IRAs may also be useful. If you do not yet qualify for Medicare coverage, you may have the option to create an HSA, which must be used in conjunction with a high-deductible health plan (the current IRS definition of a high-deductible is $1,300 for individuals and $2,600 for families). In 2016, individuals can put up to $3,350 into an HSA, families up to $6,750; those 55 or older may make an extra $1,000 catch-up contribution to their accounts. HSAs are funded with pre-tax dollars, so the contributions reduce your taxable income. HSA funds may be partly or wholly invested, and they can be withdrawn tax-free as long as they pay for qualified medical expenses. Accumulated HSA funds may be withdrawn and spent for any purpose once the accountholder turns 65; although, withdrawals will be taxed as regular income at that point if not used to pay for qualified health care costs.5

     

    IRS Publication 502 defines the cost of prescription drugs (and insulin) as a qualified medical expense. Qualified medical expenses also include lab fees and the costs of eyeglasses and contact lenses, psychiatric care, and drug and alcohol rehab programs.5,6

     

    If you are already a Medicare recipient, one unheralded approach is to use Roth IRA funds to help meet drug costs. Roth IRA withdrawals are voluntary if you are the original owner of the IRA, and they may be made tax-free if you follow IRS rules. Required Minimum Distributions (RMDs) from traditional IRAs represent taxable income, and those RMDs could put you in a higher tax bracket and even prompt a Medicare surcharge.3

           

    Lastly, see your doctor on a regular basis. A routine checkup could alert you and your primary care physician to what could become a chronic ailment. If treated early, that ailment could possibly be allayed, even overcome. Undetected or untreated, it could result in a long-term health problem with long-run financial impact.

     

    MidAmerica Financial Resources may be reached at 618.548.4777 or greg.malan@natplan.com. www.mid-america.us

      

    This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.

      

    Securities and advisory services offered through National Planning Corporation (NPC), Member FINRA/SIPC, a Registered Investment Adviser.
    MidAmerica Financial Resources and Malan Financial Group are separate and unrelated companies to NPC.

     

        

    Citations.

    1 - benefitspro.com/2015/12/09/seniors-face-enormous-out-of-pocket-prescription-c [12/9/15]

    2 - medicare.gov/part-d/costs/catastrophic-coverage/drug-plan-catastrophic-coverage.html [8/8/16]

    3 - fool.com/retirement/2016/08/07/7-strategies-to-lower-your-medicare-prescription-d.aspx [8/7/16]

    4 - vitality101.com/health-a-z/8-ways-to-slash-the-price-of-your-meds [6/8/16]

    5 - investopedia.com/articles/personal-finance/010516/how-effectively-utilize-health-saving-accounts.asp [1/5/16]

    6 - tinyurl.com/zr2fmo7 [8/8/16]