Happy New Year! Happy, healthy and safe is what we all want. We have a new administration coming in on January 20th, 2021 and those political winds will certainly affect all of us, both positively and negatively depending on how you view specific regulation and more possible tax changes. More importantly is now the economy and hopefully the pro-business ideas that the new administration will have and the positive effect it will have across all of our businesses and population. As you know we are not political in our writings as far as views, but we do want to comment on the “impact” that policies, laws and regulations may have on you.

Moving forward into 2021 we see more upside in the economy and markets, but a lot of that depends on three things; Political policies, the hope that more than 75% of the population takes the vaccine and the COVID strain doesn’t mutate into something worse that another vaccine will need to be developed. This should make common sense to all, but through hundreds of conversations throughout 2020, it’s amazing the take so many different people have on the COVID situation and the effects on the population.

As more businesses move to more normal operations in the 2nd Half of the year, more consumer’s will spend, especially at restaurants and vacation locations. This will put more people back to work and off government assistance. The net result of that level of consumer spending will push the markets up even further to catch up to many stocks that were able to thrive during 2020. Remember, the consumer is more than 70% of our economy and we need the vaccine to work and those businesses that were hurt the most to return to normalcy in order for the markets to maintain its valuation and go higher. Obviously we are being positive, but we are also relying on people pulling together and believing in the vaccine, but still being smart with masks, hygiene and social distancing.

We have put together a comprehensive “2021 Market Outlook” which you can request further down in the newsletter. This is where we have put together more insight, deeper thoughts and investment ideas to consider.

Click Here for 2021 Tax Planning Strategies – Courtesy of BrinkerSimpson Accountants

Probably the most important sage advice we can give is, “be positive”. Most people feel we have turned a corner with COVID and you need to focus on your current job and you and your family’s future. Depending on your Life Stage and Risk Profile, you may want to consider shifting some of your portfolio to more conservative assets because volatility will return in 2021. Expect several 5%-8% pullbacks and potentially 1-2 10%+ pullbacks. Be smart with your outlook over the next 3+ years as your Life Stage should dictate your allocation from Growth and Value oriented assets.

Be well, stay safe and healthy!