Products October 21, 2013

Guardian Kicks Off Financial Literacy Site

A personal financial planning website shows people how they can walk through their financial lives, starting with a career in their 20s all the way through retirement.
Reported by

The Guardian Life Insurance Company of America created a consumer-oriented, educational website to help investors start thinking about and planning for retirement. 

The site, www.myretirementwalk.com, offers tools, infographics and guidance for people at several life stages using an animated, interactive experience to provide financial planning and retirement insights. Major milestones—a person’s first job out of college, mid-career promotions, marriage, starting a family, buying a home and preparing for retirement—are guideposts along the way.

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Visitors can select an avatar based on age and gender and then guide that avatar on a simulated walk. The site offers advice about saving, managing debt and planning for the future for each stage.

My Retirement Walk is also an engagement tool for financial professionals looking to start more meaningful conversations with clients and prospects about retirement and financial planning. Only 13% of Americans report that they are very confident they will have enough money to live comfortably in retirement – according to the 2013 Retirement Confidence Survey by the Employee Benefit Research Institute (EBRI) – making it is essential for financial professionals to directly confront their clients’ educational and planning needs. My Retirement Walk can be an engaging and informative tool for advisers.

Guardian developed the website and tools in collaboration with behavioral finance expert Daniel Crosby of IncBlot Behavioral Finance. Because it can be difficult for people to break free of day-to-day responsibilities to focus on future financial needs, Crosby and Guardian leveraged the principles of behavioral finance to make the site entertaining and educational.

The goal was to help people think about their futures without feeling overwhelmed. Educated consumers are more likely to take action, especially when they can clearly envision themselves older and in retirement. Many tools, including infographics, articles and calculators, can be found through the resources tab on the site.

A blog feed on the site addresses a range of retirement-oriented topics. Crosby is the main contributor and, with other authors, will offer insights and observations on issues such as how to drive better retirement outcomes, how to develop attainable action plans for retirement saving and how to set financial goals for each of life’s stages.

In “How to Create a Retirement Action Plan,” Crosby suggests individuals move beyond the bucket list and think about items such as housing, health care and estate planning. He cautions against letting a 401(k) or other retirement plan go on auto-pilot, and suggests people work with an adviser to set and achieve financial goals. ‘’ More posts on personal finance issues will be added regularly, a Guardian spokesman said.

The website address is myretirementwalk.com.

The Markets October 21, 2013

Fund Manager Survey Shows Mixed Results

Optimism over global economic conditions and corporate profits shrunk in early October as persistent volatility and high tail risks in U.S. markets outweighed improving sentiments towards Europe.
Reported by

Researchers generated data for the Bank of America Merrill Lynch Fund Manager Survey between October 4 and October 10, finding the number of investors believing the global economy will strengthen in coming months fell to a net 54%, down substantially from a net 69% measured in September. 

Despite the drop, current levels are still generally considered strong when compared to historic levels.

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Other findings in the survey suggest a net 71% of fund managers expect economic growth to remain “below trend” in the coming year—up from a net 61% last month. Nearly one in four respondents (24%) indicated concerns about U.S. fiscal tightening topping the list of portfolio tail risks, up from just 6% in September.

Expectations for a recovery in corporate profits have also fallen. Last month, a net 41% of fund managers reported expecting corporate profits to improve worldwide in the next 12 months. In October, that number fell to a net 28%, with 18% believing corporate profit margins will decrease over the same time period. 

Those results were accompanied by a scale back in equity holdings among survey respondents. A net 49% of global asset allocators consider themselves overweight in equities, down from 60% measured in September. Additionally, the last month has seen investors reduce their positions in eight out of the 11 sectors monitored by the survey.

Last month, a net 9% of respondents were overweight in U.S. equities, but in October that measure has dropped to 0%. At the same time, investors shifted back towards fixed income, scaling back underweight positions in bonds and portfolio cash levels.

Improving convictions about European equities, emerging markets

Despite increased volatility in U.S. markets, European equities avoided the downshift in global sentiment, instead hitting a 6-year high. A net 46% of asset allocators are now overweight in European equities, up from a net 36% in September and representing the highest reading since 2007.

A net 10% said they see the Eurozone as the region with the most favorable outlook. In August, a net 5% percent forecasted falling profits for the region.

Positivity towards corporate Europe also improved over the last month. In August, a net 55% of European respondents to the survey said double-digit growth was unlikely in the following year. During October, a net 6% reported that double-digit earnings growth is now likely, representing a two-month swing of 61 points.

Japanese equities also resisted the global trend in October to record a second successive month of improvement. A net 30% of global asset allocators are overweight the region, up from a net 22% in September.

For emerging markets, a net 10% of respondents were underweight in emerging markets equities in October, improved from a net 18% underweight a month ago. 

A net 38% of the global respondents said emerging markets equities are the most undervalued of all the regions tracked by the survey. In contrast, a net 63% reported believing the U.S. is the most overvalued region.

Like U.S. markets, those in China worsened moving into October, according to the survey. A net 5% of regional fund managers expect the Chinese economy to strengthen in the coming year, down from a net 28% in September.

Also reported in the survey: Asset allocators further reduced exposures to commodities, with a net 28% calling themselves underweight in commodities against a net 16% reporting the same in September.

More on the survey’s results and methodology can be read here.

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