Here are some things you might consider before saying goodbye to 2019.   
        
What has changed for you in 2019? Did you start a new job or leave a job behind? Did you retire? Did you start a family? If notable changes occurred in your personal or professional life, then you will want to review your finances before this year ends and 2020 begins.
   
Even if your 2019 has been relatively uneventful, the end of the year is still a good time to get cracking and see where you can manage your tax bill and/or build a little more wealth. 
 
Keep in mind this article is for informational purposes only and is not a replacement for real-life advice. Please consult your tax, legal and accounting professionals before modifying your tax strategy.
  
Do you practice tax-loss harvesting? That is the art of taking capital losses (selling securities worth less than what you first paid for them) to offset your short-term capital gains. You might want to consider this move, which may lower your taxable income. It should be made with the guidance of a financial professional you trust.1 
  
In fact, you could even take it a step further. Consider that up to $3,000 of capital losses in excess of capital gains can be deducted from ordinary income, and any remaining capital losses above that can be carried forward to offset capital gains in upcoming years. When you live in a high-tax state, this is one way to defer tax.1
  
Do you want to itemize deductions? You may just want to take the standard deduction for 2019, which has ballooned to $12,200 for single filers and $24,400 for joint filers because of the Tax Cuts & Jobs Act. If you do think it might be better for you to itemize, now would be a good time to get the receipts and assorted paperwork together. While many miscellaneous deductions have disappeared, some key deductions are still around: the state and local tax (SALT) deduction, now capped at $10,000; the mortgage interest deduction; the deduction for charitable contributions, which now has a higher limit of 60% of adjusted gross income; and the medical expense deduction.2,3
   
Could you ramp up 401(k) or 403(b) contributions? Contribution to these retirement plans may lower your yearly gross income. If you lower your gross income enough, you might be able to qualify for other tax credits or breaks available to those under certain income limits. Note that contributions to Roth 401(k)s and Roth 403(b)s are made with after-tax rather than pre-tax dollars, so contributions to those accounts are not deductible and will not lower your taxable income for the year.4,5
  
Are you thinking of gifting? How about donating to a qualified charity or non-profit organization before 2019 ends? Your gift may qualify as a tax deduction. You must itemize deductions using Schedule A to claim a deduction for a charitable gift.4,5
 
While we’re on the topic of estate strategy, why not take a moment to review your beneficiary designations? If you haven’t reviewed them for a decade or more (which is all too common), double-check to see that these assets will go where you want them to go, should you pass away. Lastly, look at your will to see that it remains valid and up-to-date.  
  
Can you take advantage of the American Opportunity Tax Credit? The AOTC allows individuals whose modified adjusted gross income is $80,000 or less (and joint filers with MAGI of $160,000 or less) a chance to claim a credit of up to $2,500 for qualified college expenses. Phase-outs kick in above those MAGI levels.6
  
See that you have withheld the right amount. If you discover that you have withheld too little on your W-4 form so far, you may need to adjust your withholding before the year ends.
  
What can you do before ringing in the New Year? Talk with a financial or tax professional now rather than in February or March. Little year-end moves might help you improve your short-term and long-term financial situation.
  
This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
 
Citations.
1 - investopedia.com/articles/taxes/08/tax-loss-harvesting.asp [2/26/19] 
2 - nerdwallet.com/blog/taxes/itemize-take-standard-deduction/ [9/6/19]
3 - investopedia.com/articles/retirement/06/addroths.asp [7/28/19]
4 - investopedia.com/articles/personal-finance/041315/tips-charitable-contributions-limits-and-taxes.asp [6/5/19]
5 - marketwatch.com/story/how-the-new-tax-law-creates-a-perfect-storm-for-roth-ira-conversions-2018-03-26 [2/24/19]
6 - irs.gov/newsroom/american-opportunity-tax-credit-questions-and-answers [6/28/19]

THE MONTH IN BRIEF
The S&P 500 rose 3.4% in November and attained a series of record closes in the process. Earnings results helped stocks, as did intermittent signals that the first stage of a U.S.-China trade agreement might be near at hand. Job creation improved, and consumer spending lived up to market expectations; consumer confidence and business activity, not so much. Housing indicators communicated good news, and the rally in stocks made the commodity sector look less attractive.

DOMESTIC ECONOMIC HEALTH
Were the U.S. and China close to signing off on the first phase of a new trade deal? According to officials from both countries, the answer was yes. When would this phase-one deal be finalized? No definite answer emerged. On November 8, President Donald Trump said that such an agreement was near, and six days later, White House economic advisor Larry Kudlow said that negotiators were “getting close” to an accord. On November 26, China’s commerce ministry announced that trade representatives had “reached a consensus” on remaining issues, and President Trump said that negotiators were in the “final throes of a very important deal.” Still, November ended without any announcement that a phase-one pact had been reached.

The Department of Labor’s latest employment report found that the economy generated 128,000 net new jobs in October. This was a surprise to the upside. Analysts surveyed by Bloomberg expected 85,000 new hires. Since more people looked for work in October than in September, the headline unemployment rate ticked up 0.1% to 3.6%. The U-6 rate, which encompasses both the unemployed and underemployed, also rose 0.1% to 7.0%.

Consumer spending rose 0.3% in October, representing the largest monthly gain since July. This happened even without a gain in consumer income. One prominent index of consumer confidence declined in November: the Conference Board’s consumer confidence gauge fell 0.6 points to 125.5. The University of Michigan’s Consumer Sentiment Index, however, rose to a final November mark of 96.8 from a 95.5 preliminary reading.

In the business sector, the Institute for Supply Management’s purchasing manager indices of manufacturing and non-manufacturing activity both rose. The ISM Manufacturing PMI came in half a point higher for October at 48.3; the Non-Manufacturing PMI was at 54.7, nearly two points higher. For economists worried about a downturn in the business cycle, these numbers were encouraging.

Retail sales were up 0.3% in October, and looking ahead, the National Retail Federation is forecasting a year-over-year gain of between 3.8% and 4.2% for holiday-season retail purchases. If its prediction comes true, the 2019 holiday shopping season could rank as one of the better ones seen this decade.

An October jump of 0.4% for the Consumer Price Index was noticed by economists, but it still left annualized inflation at a manageable 1.8%. The core CPI, which strips out volatile food and energy costs, was rising 2.3% year-over-year through October.

Minutes from the Federal Reserve’s October policy meeting were released on November 20, and they indicated that central bank officials were prepared to… stand pat, at least for a while. In October, most Fed officials believed the current monetary policy approach would prove adequate to guide the economy in the near term. If some event or trend prompted a “material reassessment” of the Fed’s economic outlook, then policy might shift.

​GLOBAL ECONOMIC HEALTH
The European Union scaled back its annual growth projections for 2020-21. Its latest economic forecast projects a 1.2% increase in gross domestic product for both years. This is about half the current pace of economic expansion in the United States. Inflation is projected to vary from 1.2% to 1.3%. E.U. economists believe the euro area will have a GDP of 1.1% for 2019.

With a general election coming up in the United Kingdom, Prime Minister Boris Johnson, a Tory, and his chief challenger, Jeremy Corbyn of the Labor Party, took different views of the Brexit. In November, Johnson vowed to meet the rescheduled January 31 Brexit deadline and arrange a new trade pact with the E.U. by December of next year. Corbyn claimed his party could negotiate a new Brexit deal with the E.U. before March, a deal that would be put before the electorate; voters could either approve or reject the terms of the deal and even the Brexit, itself.

In late November, key indicators suggested that China’s economy had slowed for a seventh consecutive month. (China’s third-quarter GDP reading was its poorest in nearly 30 years.) Through October, profits at Chinese industrial companies were down 9.9% year-over-year, a record annualized dip. An index of business confidence hit a 14-month low in October.
 
WORLD MARKETS
Outside America, October index performance was mixed. Several key benchmarks advanced. France’s CAC 40 and Germany’s DAX respectively rose 3.18% and 2.35%. Russia’s RTS index gained 1.01%. Australia’s All Ordinaries added 1.45%. Japan’s Nikkei 225 was up 1.39% for the month. Eyeing a macro view of global equities, the MSCI EAFE index (which measures performance across developed stock markets outside North America) improved 1.37%.

October descents to note: Indonesia’s Jakarta Composite pulled back 4.29%, Malaysia’s KLCI lost 1.02%, China’s Shanghai Composite slipped 2.78%, Hong Kong’s Hang Seng lost 1.64%, and Mexico’s Bolsa fell 1.52%.
 
COMMODITIES MARKETS
Coffee was hot in November, rising 14.77%. Two other crops also realized big gains: cocoa was up 9.31%; wheat, 7.57%. WTI crude oil added 2.36% across November; at the November 29 close on the New York Mercantile Exchange (NYMEX), a barrel was worth $58.14.

Oil was the only key energy commodity to advance in October. Natural gas slipped 12.32%. Smaller losses came for unleaded gasoline (1.48%) and heating oil (0.12%). While copper eked out a monthly gain of 0.09%, gold lost 3.25%; silver, 5.80%; platinum, 3.46%. Gold finished November at a NYMEX price of $1,470.10 an ounce; silver, at $17.10 an ounce. Corn fell 4.94%; soybeans, 4.36%. Cotton gained 2.13%; sugar, 2.48%. The U.S. Dollar Index improved 0.94% to 98.27.
 
REAL ESTATE
The pace of home buying accelerated during October. According to the National Association of Realtors, existing home sales advanced 1.9% in October, partly reversing a 2.5% September setback. New home sales, however, retreated 0.7% for October by Census Bureau calculations; they were up 4.5% in September.

Building permits were up 5.0% in the tenth month of 2019, housing starts 3.8%. The Census Bureau noted that single-family starts were up 3.2% across the 12 months ending in October, reaching a level unseen in 12 years.

Freddie Mac said that the average interest rate for a 30-year, fixed-rate home loan was 3.68% on November 27. That compares to 3.78% on Halloween and nearly 5% a year earlier. In Freddie’s November 27 Primary Mortgage Market Survey, the mean rate on a 15-year, fixed-rate home loan was 3.15%. Incidentally, home loan processing firm Ellie Mae said refinances accounted for 51% of U.S. mortgage activity in October. The last month that saw so many refis: March 2015.

30-year and 15-year fixed rate mortgages are conventional home loans generally featuring a limit of $484,350 ($726,525 in high-cost areas) that meet the lending requirements of Fannie Mae and Freddie Mac, but they are not mortgages guaranteed or insured by any government agency. Private mortgage insurance, or PMI, is required for any conventional loan with less than a 20% down payment.

LOOKING BACK, LOOKING FORWARD
The Dow Jones Industrial Average reached another milestone in November, topping 28,000. It settled at 28,051.41 on November 29; on the same day, the Nasdaq Composite closed at 8,665.47, and the S&P 500, at 3,140.98. All in all, November was the best month for U.S. stocks since June, with indices shattering historical highs.

​The short-term economic outlook has shifted to some degree; anxieties about a recession arriving in 2020 have lessened. There is still optimism that the U.S. and China may reach a phase-one trade agreement, and the Federal Reserve appears comfortable with its current monetary policy stance and seems to be watching the business cycle closely. 

Gary G. Blom CRPC | Financial Advisor
Michael Howell MBA | Financial Advisor
Address: 3340 Tully Rd. Ste B4, Modesto, CA 95350
Website: www.blomandhowell.com
Office: (209) 857-5207 | Fax: (209) 857-5098
 
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Protecting yourself from potential calamity.
 
Cybercrime affects both large corporations and private individuals. You’ve likely read about the large data breaches in the business world. These crimes are both expensive and on the rise. The U.S. Identity Theft Resource Center says that these corporate data breaches reached a peak of 1,632 in 2017. The response to the growing need for data protection has been swift and powerful; venture capitalists have invested $5.3 billion into cybersecurity firms.1
 
That’s good news for the big companies, but what about for the individual at home? What can you do to protect data breaches to your personal accounts? 
 
For most private individuals, the key idea is to both:
* Know what to do if you’ve had a data breach.
* Know what you can do that might help prevent a data breach.
 
Total cybersecurity for your financial matters isn’t something that can be strategized in a single short article like this one, but I would like to offer you two suggestions that can help you get started. Both can be done from home and represent reactive and preventative measures.
 
Credit Freeze. By reactive, I mean that a step that you can take after the fact. In many cases, a credit freeze might be a reaction to identity theft or a data breach. What it specifically does is restrict access to your credit report, which has information that could be used to open new lines of credit in your name. The freeze prevents this, but it will not prevent a criminal from, for instance, using an active credit card number, if they’ve discovered it. For that reason, you still have to monitor for unauthorized transactions during the freeze.2
 
While the freeze is in place, you can still get your free annual credit report. You also won’t have issues with credit background searches for job or renter’s applications or when you buy insurance – the freeze doesn’t affect those areas of your credit history. You can even apply for a new line of credit during a credit freeze, though that requires a temporary or permanent elimination of the freeze during the process. This can be done through either a call to the big three credit reporting agencies (Equifax, Experian, and Transunion) or a visit to their respective websites.2
 
Password Manager. This is a preventative measure. Yes, we all know the poor soul who uses “Password” as their password. While you are probably not that far gone, the truth is that there are many tricks that cybercrooks use to learn or intuit our passwords. In fact, 20% of Internet consumers have experienced some sort of account compromise. That comes at a time when about 70% of consumers operate 10 or more accounts. A few, against best practice, will use the same password across each of those accounts. A good security measure against that is password manager software – applications that allow us to keep all our numerous passwords encrypted in a vault and drop them into our browsers when requested. While yes, there are options to save these passwords, encrypted on most browsers, these security measures are limited. Password managers are focused solely on security and are more frequently updated than the browser security features might be. That attention might be difference between a criminal obtaining access to your sensitive personal information or being blocked in the attempt.3,4
 
While this is a very basic pair of tips, they are worth thinking about and may prove to be helpful in your efforts to prevent identity theft. There are, however, additional, more-advanced choices for you to explore. Talk with your trusted financial professional about other cybersecurity best practices that you might consider.

This material was prepared by MarketingPro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note - investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This is neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment.
 
 
Citations.
1 - forbes.com/sites/forbestechcouncil/2019/10/09/the-need-for-a-breakthrough-in-cybersecurity/ [10/9/19]
2 - consumer.ftc.gov/articles/0497-credit-freeze-faqs [9/2019]
3 - wired.com/story/best-password-managers/ [9/25/19]
4 - digitalguardian.com/blog/uncovering-password-habits-are-users-password-security-habits-improving-infographic [12/18/18]