There are many things we are thankful for this year – paramount among them is the nice returns to date in 2017!

The year has been surprising not only in the magnitude of the market increase but in the absence of volatility so far. The amount of the increase is partially making up for the absence of significant market improvement in 2015 and 2016. Of course, the greater contributing factor to this increase is the global economic upswing occurring across nearly all of the world’s major economies. This upswing has led to improved corporate profits particularly in large multi-national companies that are predominant in the funds you own. In fact, these types of companies have experienced two consecutive quarters of double digit profit growth.

Meanwhile, this market increase has been extraordinarily smooth. However, some level of short-term volatility (the type that produces declines of 5-10%) is normal and to be expected simply by being an owner of large blue chip companies. This short-term volatility is normally headline driven and occurs over a span of weeks. Longer term volatility (the type that produces declines of 20-25%) is directly connected to a downturn in economic activity which is clearly not where the current economic trends are pointing. These trends from employment and manufacturing data to business and consumer confidence remain quite positive. The global economy is certainly improving but still not in top gear. Consequently, we remain optimistic about market returns in 2018 but with a healthy perspective on the realities of short-term headline driven volatility.

The ending of a year means that tax season and our 2018 client events will be upon us shortly. Time will tell what tax changes will occur for 2018 and beyond. The dueling House and Senate tax proposals don’t provide a clear direction at this point. For the current year, there are no major tax changes so we would expect tax returns to be similar to prior years. The only exception would be that capital gain distributions are expected to be slightly larger than past years which would increase the tax implications on non-retirement accounts.

Please mark your calendar for Tuesday, February 6, which will be our first client meeting of 2018. This will be a dinner event at the Country Club of Orlando and Joe Valencia from the American Funds will provide a 2018 Outlook. Look for more details on this event in our letter mailing in early January.

The end of the year is always a good time for a review so if you have not been in to see us lately, please call the office to set up a conversation.

Dear Friends,

We trust you all survived Hurricane Irma last week. The office was out of power for a day before resuming normal operations. It is so sad to see the pictures and hear the stories about the devastation in the Keys and the Caribbean. The forces of nature are powerful indeed!

Meanwhile, the markets continue to shrug off any negative news and move higher. Your third quarter statements which you will get in a couple of weeks are on pace to show another 2-3% increase for the most recent three month period. For the year so far, domestic equity funds are up over 12% while international funds are up over 20%.

There are some real economic fundamentals that are helping to drive this upward trend and provide the basis for our continued optimism. First, the major economies of the world are expanding in unison for the first time since the 2008 financial crisis. Second, inflation remains subdued keeping both the Federal Reserve and the European Central Bank on the sidelines to leave interest rates unchanged. Third, the U.S. economy is not over leveraged as there has been minimal credit growth over the past 10 years; and the U.S. financial system is better capitalized than it has been in years. Fourth, the stock market is not being driven upward by investor euphoria as $737 billion has been pulled out of equity strategies since the 2008 financial crisis.

Our client meeting next week will focus on the overall economic picture and discuss the importance of the active investment management that happens in each fund you own with us. Our typical client portfolio consisting of 8-10 funds which hold about 1,200-1,500 different publicly traded companies. During the course of the year approximately 300-400 of those companies will be sold and other companies bought. This very active investment approach generates superior long-term results.

Brad Rutan of MFS Investments will be our guest speaker at the event on Wednesday, September 27. As usual, the event starts at 5:30 at the Country Club of Orlando (1601 Country Club Drive, Orlando, FL) and features dinner and drinks. If you have not yet reserved your space at this meeting or would like to bring a friend, please call the office at 407-629-6477 or reply to this email.

On another note, many of you have asked us how to respond to the widely reported data breach by Equifax, one of the three credit monitoring agencies. We discussed this topic this past Sunday on the radio show (“Dollars & Sense” Sundays 9-10 AM on 102.5 FM/540 AM) and you can listen to the show on Facebook via this link https://www.facebook.com/NelsonFinancialPlanning/posts/1944460429170427 . You can also refer to the information put out by the Federal Trade Commission at https://www.consumer.ftc.gov/blog/2017/09/equifax-data-breach-what-do .

I followed the steps outlined by the FTC to find out that I may have been affected by the data breach at Equifax so I subscribed to the free credit monitoring service. Another option is to place a credit freeze or fraud alert on your credit. The fraud alert is not quite as cumbersome as the freeze when seeking credit in the future so I prefer the fraud alert unless there has been a specific incidence of identity theft. Protecting your information is of the utmost priority here at the office and we recently upgraded our firewall to the best available option on the market. We certainly live in a different and vastly electronic era these days!

If you have not been in to see us lately, please call the office to arrange a review. Thank you as always for your continued confidence and the referral of your friends to us! Look forward to seeing you on the 27 ^th _.

Dear Friends,

As President Trump marks his 100 ^th day in office tomorrow, we thought it would be a good time to take stock of where the markets, economy and headlines are.

2017 is clearly off to a great start for the markets. So far, U.S. markets are up over 6% and non-U.S. markets are up over 8%. We believe that much of this movement is simply a catch up to the economic improvement in the second half of 2016. This better economic data had generally been underappreciated and underpriced by equity markets. The election, in and of itself, simply provided the resolution of some uncertainty that gave the markets an opportunity to focus on the better economic conditions at hand.

Currently, we believe the markets are pricing in the expectation of additional economic growth. This expectation is predicated on a combination of diminished regulatory burdens on the private sector; lower personal and corporate tax rates; and fiscal stimulus in the form of infrastructure spending. Unfortunately, these pro-growth policies have been delayed by political wrangling. We are optimistic that these policies will take effect in the near term, but any further delays in implementation could splash some cold water on the markets.

Despite this political uncertainty, the greater trend towards optimism cannot be ignored. Consumer and business confidence numbers are both at levels not seen for well over a decade. Of course, optimism can be fickle particularly if headline events like North Korea take a disastrous turn. Absent that type of event (which is always a risk in today’s world), we continue to expect that this optimism will lead to tangible effects like greater spending by households and greater hiring by corporations.

Here at the office, another tax season has come and gone. If we have not yet visited with you personally in 2017, now is a perfect time to come in to the office for a general conversation. In other news, Nelson Financial Planning was recently ranked by AdvisoryHQ News as a top-rated financial advisory firm in Orlando, FL. We have attached their review to this email for your reference and to share with your friends.

We are getting ready for our upcoming client appreciation event at Enzo’s on your choice of May 11 or May 16. We thank you for your timely response and selection of food and dates. We are very excited that the response to this event has been so strong. Both dates are currently on a wait list due to venue size restrictions so please let us know if your plans change.

As always, for our latest thoughts, tune in to our weekly radio show “Dollars and Sense” at 9AM on Sunday at 540 AM/102.5 FM. The show is also available the following day on our website www.NelsonFinancialPlanning. com or on Facebook or Twitter under Nelson Financial Planning and Linked In under Joel Garris.

Look forward to seeing you on either May 11 or May 16!

21,000 on the DOW – what does it really mean? Clearly, it means positive things for the value of your accounts. Our investment allocations that typically include high levels of exposure to stocks are now fully participating in this rally. Our email at the first of the year expressed concern that the post-election rally in November and December was quite concentrated in a handful of companies in certain sectors where a Trump victory meant less regulation and more profitability. So far, in 2017, the rally has become much broader principally because the economic data continues to improve. Just last week, manufacturing activity in both China and the U.S. showed nice improvement. Meanwhile, sentiment among consumers and small business owners continues to hit levels not seen in many years.

However, just as our counsel is to maintain perspective and not get too caught up in the constantly negative news cycle, we encourage the same behavior now. A 1,000 point increase on the DOW doesn’t mean as much as it used too. The simple math underscores that. When the DOW was at 10,000, a 1,000 point jump meant a 10% increase. Now, with the DOW at 20,000, a 1,000 point increase means a 5% improvement. This 1,000 point jump in just 24 days is not even record setting in market history – merely tying a record set in 2009.

Clearly, there are reasons for cautious optimism ahead on the strength of consumer confidence and improvement in manufacturing activity. But in terms of percentage swings, this is nothing more than normal market behavior where on average swings of 5-10% occur about three times per year. We remain somewhat concerned about the continued inconsistencies of the Trump administration. In this global economy where corporate America makes nearly half of its profits (45% to be exact) from outside the U.S.A., a breakdown in international relations and trade could quickly undermine these results.

All of this certainly sets the stage for our next client meeting on March 28. Our speaker will be Bill Cass from Putnam Investments. Bill returns to discuss the latest economic and market conditions and to provide a look ahead to the rest of 2017. Please join us on March 28 at 5:30 at the Country Club of Orlando, 1601 Country Club Drive, Orlando, FL. Please RSVP for you and your guests to this email or the office at 407-629-6477.

Please stay tuned to our weekly radio show “Dollars and Sense” for our thoughts on the latest news. The speed of the news cycle these days is ever increasing and our live weekly show provides an opportunity to hear our take on the current headlines. The show airs at 9AM on Sunday at 102.5 FM or 540 AM and is available the following day on our website www.NelsonFinancialPlanning.com or our social media outlets on Facebook, Twitter or Linked In.

Around the office these days tax season is underway. While we expect many changes for 2017, 2016 returns are generally running quite similar to the prior year for most people. The only exception to this is that mutual fund capital gain distributions appear to be lower from the previous year so that is helping to reduce the tax burden for some.

On a personal note, my oldest son Nelson recently achieved the rank of Eagle Scout. So very proud of him and his accomplishments. Hard to believe he turns 16 later this month and then I will be constantly looking for my car keys!

Look forward to seeing you at the meeting on March 28!

Dear Friends,

From Brexit to Trump, 2016 produced unexpected results that made it a particularly difficult year to navigate. While our returns were positive for the year with overall results up about 7-8%, market performance particularly the Dow made headlines moving to the 20,000 level. Unfortunately, this performance was driven by a handful of companies which undermined our diversified approach in the short term.

These concentrated results occurred in a handful of financial, healthcare and energy companies who saw their fortunes reverse dramatically on election night in anticipation of a looser regulatory environment under Trump. The broader markets in 2016 saw minimal earnings and revenue growth (0.1% and 2.2 % respectively) for businesses. Diversification – just like being consistent on your holdings – is a strategy that works well over time to reduce overall portfolio risk. While providing consistent returns, it is not 100% perfect all the time.

It has been a while since we have seen this type of phenomena – 17 years in fact. In 1999, a handful of tech companies drove the market to new highs only to fall back to earth in 2000 and 2001. While I don’t believe we are in a 1999 scenario these days, there are certainly some parallels. Regardless, don’t be alarmed by your quarterly statement that you will get next week that will show minimal growth for the quarter. In addition, the international and bond portion of your allocations also worked to undermine the domestic performance. The silver lining there is that your investment allocations are lighter on those asset classes these days. Overall, the year was decent in terms of results and that’s our overall investment goal.

Looking ahead to 2017, the consumer appears to be less pessimistic than in prior years based on the past few months of consumer confidence data. This is crucially important for broad economic and market growth as consumer spending accounts for 70% of our economy. In fact, corporate earnings are expected to grow by 12% for 2017 with top line revenue growth of 6%. Meanwhile the average consumer has less debt, more cash and has finally started to experience real wage growth (nearly 4% in 2016) for the first time in years. For these reasons, we are particularly positive for the overall market in 2017.

2016 was a busy year at the office. Our main efforts involved a successful rebrand to Nelson Financial Planning along with continued efforts to ensure the cyber security of your information. We also became active on social media so be sure to follow us on Facebook, Twitter or Linked In. These outlets also provide an opportunity for broader dissemination of our weekly radio show “Dollars and Sense.” Hearing it live at 9 AM on Sunday at 102.5FM or 540AM can often conflict with church schedules but now it is always available the next day on our website at www.NelsonFinancialPlanning. com .

Tax season and our client meetings for 2017 will start very soon. In fact, our first one is coming right up on January 19. This meeting will follow our usual dinner format starting at 5:30 at the Country Club of Orlando, 1601 Country Club Drive, Orlando, FL. Our speaker will be Joe Valencia from the American Funds. Joe’s 2017 Outlook presentation should make for an informative meeting. Please RSVP for you and your guests to this email or to the office at 407-629-6477.