LUMINATE NEWSLETTER ISSUE 2 2024
IN THIS ISSUE
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Welcome Golden Lantern Market Outlook Food for Thought Behind the Scenes Highlights
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WELCOME The Luminate team is thrilled to share this newsletter with you in hopes of keeping you closely connected and informed about the latest happenings and insights. In this issue, we celebrate our Golden Lantern award winner, an award honoring those who has made a profound impact on the Luminate vision, culture, and clients. We also provide a detailed Market Outlook , offering key economic insights and forecasts that are essential in today's ever-evolving business landscape. Additionally, our Food for Thought section is designed to enrich your knowledge with practical advice to help set you up for success. Lastly, don’t miss our Behind the Scenes Highlights where we share important milestones and celebrate our collective successes. We believe that by staying informed and connected, we can all advance together. Enjoy the read!
THE GOLDEN LANTERN
The Golden Lantern award at Luminate is a prestigious quarterly recognition, voted on by all team members, celebrating individuals who profoundly influence the company's vision, culture, and client relationships. This honor acknowledges those who exemplify outstanding dedication and impact within the organization.
The most recent recipient of this esteemed accolade is Financial Planning Analyst Irene Valle !
• Consistently demonstrates a strong work ethic • Irene’s contributions have significantly impacted our team's success • Excellent communicator • Always ready to lend a helping hand to anyone who needs it • Keeps the firm promise by always delivering exceptional client service • She is a HIGHLY organized insurance rockstar!
To read Irene’s bio, visit www.luminatewealth.com/team
MARKET OUTLOOK
AI & TECH DRIVE MARKET RETURNS In recent months, the market has been significantly influenced by the strong performance of growth stocks, particularly in the AI and tech sectors. Notable companies such as NVIDIA and Apple have showcased impressive growth, with NVIDIA's stock surging over 36% and Apple rising by more than 22% in the last quarter alone. NVIDIA's strategic decision to split their stock 10 to 1 and Apple's massive stock buyback at a record of $110 billion dollars have further cemented their positions as market leaders. These companies, which together hold a weight of almost 14% in the S&P 500, have been the primary drivers of market returns. This concentrated performance highlights the importance of large-cap growth stocks in the current market landscape. In contrast, other areas of the market, including small-cap stocks and bonds, have remained relatively flat or negative. Consequently, our portfolio has been strategically positioned to capitalize on these large-cap growth opportunities.
INFLATION: A PERSISTENT CHALLENGE
• While inflation has shown signs of peaking, it has stalled at levels higher than the Federal Reserve's target. The Fed's recent quarterly Summary of Economic Projections (SEP) indicates that inflation is expected to remain elevated, leading to a projected year-end Federal Funds Rate of around 5%. Consequently, the Fed's pace of rate reductions is likely to be more gradual, with only a modest decrease expected in 2024. We believe that any significant rate cuts will be driven more by rising unemployment rates than by declining inflation. Current unemployment rates have edged up from a low of 3.5% last year to around 4%, and further increases could prompt the Fed to act. Lorem ipsum semper • Lorem ipsum semper
• Lorem ipsum semper Lorem ipsum semper OUR SPOTLIGHT RECIPIENT •
MARKET OUTLOOK
OUR STRATEGIC APPROACH At Luminate, our investment strategy is dynamic and responsive to evolving market conditions. Unlike the "set it and forget it" approach common in the industry, we continually adjust our portfolios based on the latest economic data. This proactive management has been particularly evident in our recent moves adding to large-cap growth, taking profits in health care, and adding to emerging markets. In 2022, our anticipation of rising interest rates led us to reduce our bond holdings in favor of alternatives, insulating our portfolios from market downturns. As bond rates increased, we gradually re-entered the bond market, capitalizing on more favorable conditions. This strategic flexibility allows us to protect and enhance our clients' portfolios, adapting to both inflationary pressures and interest rate fluctuations. OUR COMMITMENT TO FLEXIBILITY Flexibility and adaptability are cornerstones of our investment philosophy. Our portfolios are designed to be living entities, capable of responding to market changes and seizing opportunities across various sectors. Whether returns come from energy stocks, dividend stocks, or growth stocks, our focus remains on maximizing growth while managing risk. PARTNER WITH LUMINATE With Luminate as your trusted wealth management partner, you can navigate today's complex market with confidence. Our commitment to insightful, proactive guidance ensures you are well prepared to embrace both opportunities and challenges in the ever- evolving financial landscape. In a landscape marked by uncertainty — from inflation and interest rates to geopolitical issues — our tactical approach ensures we remain agile and well-positioned. By continually monitoring market conditions and adjusting our strategies, we aim to deliver superior returns without taking on unnecessary risks.
FOOD FOR THOUGHT
OUR SPOTLIGHT RECIPIENT The Tax Cuts and Jobs Act (TCJA) of 2017 Are you familiar with the Tax Cuts and Jobs Act (TCJA)? This major tax legislation was passed in 2017 and brought about significant changes to both individual and business taxes. While many of these changes were designed to be permanent, several key provisions are set to expire at the end of 2025. This is often referred to as the "sunset" of the TCJA.
WHAT DOES THIS MEAN FOR YOU?
The sunset of the TCJA could have a substantial impact on your tax situation. For individuals, this could mean higher income tax rates, a reduced standard deduction, and the return of the Alternative Minimum Tax (AMT). For businesses, the valuable Qualified Business Income (QBI) deduction could disappear. Additionally, the estate and gift tax exemption, which was temporarily doubled under the TCJA, is set to revert to its pre-2018 levels.
FOOD FOR THOUGHT
WHY PLANNING IS CRUCIAL
Given the potential tax implications of the TCJA sunset, it's essential to start planning now. By understanding how these changes could affect you, you can make informed decisions about your financial future. For example, you might consider accelerating income or deductions, converting a Traditional IRA to a Roth IRA, or making significant gifts before the estate tax exemption is reduced. WE'RE HERE TO HELP Navigating the complexities of tax law can be challenging. That's why our team is here to guide you through this process. We can help you understand the potential impact of the TCJA sunset on your specific situation and develop a personalized plan to minimize your tax burden and maximize your financial well-being.
Don't wait until it's too late. Reach out today and let’s talk about how we can help you prepare for the TCJA sunset.
Recently our firm attended a seminar led by nationally- recognized tax expert Bob Keebler of Keebler & Associates regarding the upcoming sunset of the Tax Cuts and Jobs Act (TCJA). Many of these provisions are set to expire at the end of 2025 and may impact your family or business. We have some great planning to share and excited to talk to you more about it!
OUR SPOTLIGHT RECIPIENT
BEHIND THE SCENES HIGHLIGHTS
New Video!
Check out our new video and discover why clients trust Luminate Wealth to Light the Path to their Greatest Life. Our mission is to partner with you to Plan Wisely so that you can Live Boldly. Luminate Wealth is dedicated to providing personalized financial strategies tailored to your unique goals. Whether you're planning for retirement, growing your investments, or securing your family's future, our expert guidance ensures you're always one step ahead.
OUR SPOTLIGHT RECIPIENT
Visit www.luminatewealth.com to watch our video and learn more about how we help others achieve financial success and how we can help you. We gladly offer a no cost 2nd opinion service.
Emily Bassin ’s New Arrival! We are thrilled to announce the arrival of baby Andrew, born on May 11th, to Emily Bassin’s family! This joyous addition has brought a wave of happiness and excitement to their family, and we couldn’t be happier for them. Congratulations to the proud parents as they embark on this wonderful new chapter!
OUR SPOTLIGHT RECIPIENT
18575 Jamboree Rd, Suite 400 Irvine, CA 92612 (949) 622-7237 luminatewealth@nm.com www.luminatewealth.com
This publication is not intended as legal or tax advice. Financial Representatives do not render tax advice. Consult with a tax professional for tax advice that is specific to your situation. The opinions expressed are those of Luminate Wealth Management & Insurance Services as of the date stated on this newsletter and are subject to change. There is no guarantee that any forecasts made will come to pass. This material does not constitute investment advice and is not intended as an endorsement of any specific investment or security. Please remember that all investments carry some level of risk, including the potential loss of principal invested. Indexes and/or benchmarks are unmanaged and cannot be invested in directly. Returns represent past performance, are not a guarantee of future performance and are not indicative of any specific investment. Diversification and strategic asset allocation do not assure profit or protect against loss. Members of Luminate Wealth Management & Insurance Services use Luminate Wealth Management & Insurance Services as a marketing name for doing business as representatives of Northwestern Mutual. is not a registered investment adviser, broker-dealer, insurance agency, or federal savings bank. Northwestern Mutual is the marketing name for The Northwestern Mutual Life Insurance Company (NM) and its subsidiaries in Milwaukee, WI including Northwestern Mutual Investment Services, LLC (NMIS) (investment brokerage services) a registered investment advisor, broker-dealer, and member of FINRA and SIPC, and Northwestern Mutual Wealth Management Company (NMWMC) (investment advisory services), a federal savings bank. Northwestern Mutual Private Client Group is a select group of Northwestern Mutual advisors and representatives. Northwestern Mutual Private Client Group is not a registered investment adviser, broker-dealer, insurance agency, federal savings bank or other legal entity.
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