U.S. stocks turned in a second consecutive quarter of dramatic gains, continuing a historic stock market recovery that few predicted in the depths of the March downturn. The S&P and Nasdaq Composite scored a string of records in the third quarter which has confounded many investors with its sheer velocity and strength. Despite a stretch of volatility in September, the S&P 500 and Dow Jones Industrial Average gained 8.5% and 7.6% respectively over the past three months. Both indexes are up more than 26% since the end of March. Considering the effects of the pandemic and the impact it had on the economy, these are outstanding outcomes. The patient investor has been rewarded for staying calm during the storm.

This year can best be described as unpredictable. The pandemic has changed the economy, business, work, school and our lives in ways we never envisioned just nine months ago. Looking ahead to the fourth quarter much uncertainty remains about the timing and public acceptance of a COVID-19 vaccine which in turn, raises doubt about the strength of the economy’s future growth prospects. Congress is still working on a second stimulus package, and the passing of Justice Ginsberg has only increased the tension between the two parties. The outcome of the Presidential election could have significant economic and social consequences, and there is an increasing probability the results will be contested. Relations with China have not improved, and the Federal Reserve has offered few, if any, specifics on the recent changes made to their monetary policy toolkit.

Amidst the volatility and uncertainties, economic data is improving. New home sales (August) climbed for a fourth straight month to the highest level in nearly 14 years. Following two straight months of declines, consumer confidence rebounded in September. We have seen stronger than expected employment results, strength from big technology in the post COVID-19 economy, monetary support from central banks with the hope for additional fiscal stimulus and prospects for an effective vaccine.

The financial markets are starting the fourth quarter on a relatively high note providing investors a golden opportunity to reevaluate their portfolios and risk exposures. It’s imperative to take a long-term balanced approach to your portfolio and it’s just as important to set your risk tolerance to comfortably weather future volatility. Markets are moving at speeds we never thought possible and it is necessary to properly position your financial plan to stay invested for the long haul.


On August 18, 2020, the U.S. Department of Labor (DOL) issued an interim final regulation implementing Section 203 of the Setting Every Community Up for Retirement Enhancement Act of 2019 (the SECURE Act), which requires an annual lifetime income disclosure for 401(k) and other ERISA defined contribution plan participants, “to give a realistic illustration of how much monthly retirement income they could expect to purchase with their account balance”. The statement must include an estimated monthly payment based on a single life annuity and a qualified joint and 100% survivor annuity. Both options must be illustrated regardless of whether the participant is single or married.

Although issued as an interim final regulation, the DOL is allowing a 60-day comment period, and it hopes to improve the regulation before its effective date. The rule will be effective one year after publication in the Federal Register.

Producing this lifetime income figure requires five pieces of information: the account balance, the date of starting payments, the age on which the annuity starts, the interest rate and an estimated end date for the payments. Since only the first (account balance) is known at the point of producing the statement, the other assumptions are prescribed in the rule.

The DOL outlined four goals for this undertaking: uniformity in calculation methodology; providing a basic understanding of how it was calculated – clear and concise explanation of how it was done, including an unambiguous statement that the projections are not guaranteed; model language to use in doing so; and “broad fiduciary relief” for those that use the regulatory assumptions, and the model language prescribed by the rule, with language drawn from the SECURE Act itself that clarifies that those who do “will not be held reliable in the event participants are unable to purchase equivalent monthly payments,” according to the DOL.


As the year-end approaches and situations change from year to year, individuals should take stock and ask themselves basic questions, such as:

  • Financial goals – are they still on track?
  • Should you reassess your risk tolerance?
  • Do you need to minimize your tax bill?
  • Review your investment performance. Is it time to rebalance your portfolio?
  • Review current participation rate. Will your current contribution level get you to your retirement goal?
  • Review all Beneficiary information. Have life events affected existing designations?