Atlantic Capital Management

Atlantic Capital Management (112)

As predicted by many market-watchers, the Federal Open Market Committee announced on January 29 that it would continue to cut its monthly bond purchases. Citing the continued moderate expansion of the U.S. economy, Fed Chairman Ben Bernanke moved to trim the bond-buying program (known commonly as “quantitative easing” or “the Fed taper”) from $75 billion per month to $65 billion. Bernanke additionally announced that the Fed’s policy of supporting near-zero short-term interest rates would continue indefinitely. Short-term interest rates, which govern the rates at which financial institutions borrow from one another, have a cumulative effect on all loans; in deciding to keep the federal funds rate target rate between 0% and 0.25%, the Fed reiterated its focus on stimulating the economy through availability of capital.

Several things came to mind as I read through the announcement:

  • What does this mean for investors? Despite a little bit of turmoil in the markets during the run-up to and in the wake of the announcement, this round of quantitative easing will have very little impact on investors who are well-diversified and in it for the long haul. Asset allocation for breadth and depth, across markets and sectors, is still the “status quo” strategy for our portfolios.
  • The Fed remains bullish about U.S. recovery. It’s hard not to see the continued expansion of the taper as a vote of confidence for the overall recovery of the U.S. economy. Chairman Bernanke specifically reiterated the Fed’s forecasts for 3% growth in 2014 and 2015 during the announcement. Low interest rates are good for the economy and for investors. And the Fed’s continued assertion that it will keep those interest rates low “well past” the point where the unemployment rate reaches 6.5% builds in some favorable long-term perspective.
  • Emerging markets are in for more volatility. The algorithm here is simple: as investors look to the U.S. as the first-world economy with the most upside potential, the flow of capital out of emerging markets and into the resurgent domestic economy may accelerate.  This may retard emerging market recovery.  At best, it will do little to quell the correction that has been bleeding emerging market investors since the spring.

At ACM, we’re inclined to follow the Fed’s lead and “stay the course” with our traditional focus on breadth and depth across markets. We’ll certainly be paying attention to the next rounds of tapering as they take place, but for right now, we’re taking it in stride.

Tuesday, 11 February 2014 00:00

Women and Financial Independence

Written by

As we discussed in last year’s article on the growing increase in life expectancy (“Financial Security for Longer Life Expectancy” ), Americans are living longer. Women in particular are living well past the average life expectancy benchmarks. Recent longevity statistics tell us that women will generally outlive men by 5 to 7 years; the promise of a longer life is even better for those that are married.

Most women of the “Baby Boomer” generation seem to realize that their life expectancy will exceed that of their parents' generation. Less obvious are the financial consequences of extended longevity. Boomer women have embraced living longer, but remarkably few of them have done the kind of retirement planning necessary to address that possibility. Studies indicate that less than one-third of women age 55 or older have enough retirement money to match income projections based on their average life expectancy and beyond.

So, what does all this mean for women in terms of graciously living out this expected and predictable extension of life? Our many years of experience tell us this: having a retirement plan that addresses this scenario is a necessary, and fairly simple, requirement! Here are three suggestions that will help you get off to a good start:

1. Be brave. Not having enough money for later life is a scary thought, and can be emotionally paralyzing. Instead of letting that fear lead to procrastination, take an objective and creative look at your situation. Explore your options…all of them, no matter how daunting or trivial. Simply being aware of the options for reducing your lifestyle can be empowering. For example, you may need to consider “downsizing” out of your family home. Getting through the emotional aspects of this decision is hard. But being brave, and being proactive about the idea of making a change, will help to strengthen feelings of being in control of your financial future.

2. Don't wait. Procrastination isn't an option. The planning and decision-making processes take time. Take one simple step right now: determine how much cash flow your current lifestyle is requiring each month, and make the necessary adjustments to your spending and saving habits with your retirement goals in mind. Get started now. It won't be easier or better or more comfortable if you wait to begin your planning process.

3. Be realistic. If you don’t have the experience or information to plan your financial future over the next 20 to 40 years, the “do-it-yourself” approach might not be for you. Ask for help! The statistics are staggering: 74% of women over the age of 50 don’t have a financial adviser to help walk them through this process. Start looking for someone to work with now. Interview tirelessly until you find the person who has both the credentials and personality you are comfortable with to help you on your journey.

Our Blog


(19 articles)


(24 articles)


(24 articles)


(15 articles)


(18 articles)


(12 articles)


(3 articles)