Cybercrime is booming. In 2021, the FBI reported that cybercriminals scammed nearly $7 billion from Americans — a figure slightly higher than the gross domestic product (GDP) of Switzerland for that year, according to research organization World Economics. How can you protect yourself from cyberthieves? Here are some suggestions that can help:
 

• Watch out for “phishing” attempts. You may receive emails that appear to be from a legitimate firm, requesting information your financial institution would never request online — confirmation of an account number, password, Social Security number, credit card number and so on. These notes can look official, often incorporating a firm’s logo, so pay close attention to what’s being asked of you.
• Think twice before clicking or downloading. If you are suspicious about a communication, don’t click on a link or download an attachment — instead, go to your financial firm’s website or use their app to verify they sent the information or request.
• Become adept with passwords. Use a different password for each of your accounts and change your passwords regularly. Of course, maintaining multiple passwords can be confusing, so you might want to consider using password management software, which generates passwords, stores them in an encrypted database and locks them behind a master password — which is the only one you’ll need to remember.
• Use your own devices. Try to avoid using public computers or devices that aren’t yours to access your financial accounts. If you do use another computer, clear your browsing history after you log out of your account.
• Be cautious about using Wi-Fi when traveling. When you’re on the road, you may want to use public hotspots, such as wireless networks in airports and hotels. But many people don’t realize that these hotspots reduce their security settings to make access easier, which, in turn, makes it easier for cyberthieves to intercept your information. In fact, some hackers even build their own public hotspots to draw in internet-seekers in an effort to commit theft. So, if at all possible, wait until you can access a trusted, encrypted network before engaging in any communications or activity involving your financial accounts.
• Don’t give up control of your computer. Under no circumstances should you provide remote access to your computer to a stranger who contacts you, possibly with an offer to help “disinfect” your computer. If you do think your device has an issue with malicious software, contact a legitimate technician for assistance.
• Know whom you’re calling for help. If you need assistance from, say, a customer service area of a financial institution, make sure you know the phone number is accurate and legitimate — possibly one from a billing or confirmation statement. Some people have been scammed by Googling “support” numbers that belonged to fraudsters who asked for sensitive information.
• Review all correspondence with your financial services provider. Keep a close eye on your account activity and statements. If you see mistakes or unauthorized activity in your account, contact your financial institution immediately.

Advanced technology has brought many benefits, but also many more opportunities for financial crimes. By taking the above steps, and others that may be needed, you can go a long way toward defending yourself against persistent and clever cyberthieves.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor Preston Carbone, Westford, MA  - EdwardJones.com/Preston-Carbone, Edward Jones, Member SIPC

It’s that time of year when many of us promise ourselves we’ll go to the gym more, or learn a new language, or take up a musical instrument, or any number of other worthy goals. But this year, when making New Year’s resolutions, why not also consider some financial ones? Here are a few to consider:

• Don’t let inflation derail your investment strategy. As you know, inflation was the big financial story of 2022, hitting a 40-year high. And while it may moderate somewhat this year, it will likely still be higher than what we experienced the past decade or so. Even so, it’s a good idea to try not to let today’s inflation harm your investment strategy for the future. That happened last year: More than half of American workers either reduced their contributions to their 401(k)s and other retirement plans or stopped contributing completely during the third quarter of 2022, according to a survey by Allianz Life Insurance of North America. Of course, focusing on your cash flow needs today is certainly understandable, but are there other ways you can free up some money, such as possibly lowering your spending, so you can continue contributing to your retirement accounts? It’s worth the effort because you could spend two or three decades as a retiree.

• Control your debts. Inflation can also be a factor in debt management. For example, your credit card debt could rise due to rising prices and variable credit card interest rate increases. By paying your bill each month, you can avoid the effects of rising interest rates. If you do carry a balance, you might be able to transfer it to a lower-rate card, depending on your credit score. And if you’re carrying multiple credit cards, you might benefit by getting a fixed-rate debt consolidation loan. In any case, the lower your debt payments, the more you can invest for your long-term goals.

• Review your investment portfolio. At least once a year, you should review your investment portfolio to determine if it’s still appropriate for your goals, risk tolerance and time horizon. But be careful not to make changes just because you feel your recent performance is not what it should have been. When the financial markets are down, as was the case for most of 2022, even quality investments, such as stocks of companies with solid business fundamentals and strong prospects, can see declines in value. But if these investments are still suitable for your portfolio, you may want to keep them. 

 • Prepare for the unexpected. If you encountered a large unexpected expense, such as the need for a major home repair, how would you pay for it? If you didn’t have the money readily available, you might be forced to dip into your long-term investments or retirement accounts. To prevent this, you should build an emergency fund containing three to six months’ worth of living expenses — or a year’s worth, if you’re retired — with the money kept in a low-risk, liquid account. 

These  resolutions can be useful — so try to put them to work in 2023.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor James Normington, AAMS, Westford, MA - EdwardJones.com/James-Normington. Edward Jones, Member SIPC

There are no shortcuts to investment success – you need to establish a long-term strategy and stick with it. This means that you’ll want to create an investment mix based on your goals, risk tolerance and time horizon – and then regularly review this mix to ensure it’s still meeting your needs. In fact, investing for the long term doesn’t necessarily mean you should lock your investments in forever. Throughout your life, you'll likely need to make some changes.

Of course, everyone’s situation is different and there’s no prescribed formula of when and how you should adjust your investments. But some possibilities may be worth considering. For example, a few years before you retire, you may want to re-evaluate your risk exposure and consider moving part of your portfolio into a more risk-averse position. When you were decades away from retiring, you may have felt more comfortable with a more aggressive positioning because you had time to “bounce back” from any market downturns. But as you near retirement, it may make sense to lower your risk level. And as part of a move toward a reduced-risk approach, you also may want to evaluate the “cash” positions in your portfolio. When the market has gone through a decline, as has been the case in 2022, you may not want to tap into your portfolio to meet short-term and emergency needs, so having sufficient cash on hand is important. Keep in mind, though, that having too much cash on the “sidelines” may affect your ability to reach your long-term goals.

Even if you decide to adopt a more risk-averse investment position before you retire, though, you may still benefit from some growth-oriented investments in your portfolio to help you keep ahead of – or at least keep pace with – inflation. As you know, inflation has surged in 2022, but even when it’s been relatively mild, it can still erode your purchasing power significantly over time.

Changes in your own goals or circumstances may also lead you to modify your investment mix. You might decide to retire earlier or  later than you originally planned. You might even change your plans for the type of retirement you want, choosing to work part-time for a few years. Your family situation may change – perhaps you have another child for whom you’d like to save and invest for college. Any of these events could lead you to review your portfolio to find new opportunities or to adjust your risk level – or both.

You might wonder if you should also consider changing your investment mix in response to external forces, such as higher interest rates or the rise in inflation this year. It’s certainly true that these types of events can affect parts of your portfolio, but it may not be advisable to react by shuffling your investment mix. In the first place, nobody can really predict how long these forces will keep their momentum – it’s quite possible, for instance, that inflation will have subsided noticeably within a year. But more importantly, you should make investment moves based on the factors we’ve already discussed: your goals, risk tolerance, time horizon and individual circumstances.

By reviewing your portfolio regularly, possibly with the assistance of a financial professional, you can help ensure that your investment mix will always be appropriate for your needs and goals.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor Alan Bell, Littleton, MA - EdwardJones.com/Alan-Bell. Edward Jones, Member SIPC.

If you receive Social Security, you’ve probably already heard that your checks in 2023 will be bigger – considerably bigger, in fact. How can you make the best use of this extra money? Here’s what’s happening:

For 2023, there’s an 8.7% cost-of-living adjustment (COLA) for Social Security benefits – the largest increase in 40 years. Also, the monthly Medicare Part B premiums are declining next year, to $164.90/month from $170.10/month, which will also modestly boost Social Security checks for those enrolled in Part B, as these premiums are automatically deducted.

Of course, the sizable COLA is due to the high inflation of 2022, as the Social Security Administration uses a formula based on increases in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). So, it’s certainly possible that you will need some, or perhaps all, of your larger checks to pay for the increased cost of goods and services. But if your cash flow is already relatively strong, you might want to consider these suggestions for using your bigger checks:

• Reduce withdrawals from your investment portfolio. When you’re retired, you will likely need to withdraw a certain amount from your portfolio each year to meet your expenses. A boost in your Social Security may enable you to withdraw less, at least for a year. This can be particularly advantageous when the markets are down, as you’d like to avoid, as much as possible, selling investments and withdrawing the money when investment prices are low. And the fewer investments you need to sell, the longer your portfolio may last during your retirement years.

• Help build your cash reserves. When you’re retired, it’s a good idea to maintain about a year’s worth of the amount you’ll spend from your portfolio in cash, while also keeping three months’ of your spending needs in an emergency fund, with the money kept in a liquid, low-risk account. Your higher Social Security checks could help you build these cash reserves. (Also, it’s helpful to keep another three to five years’ worth of spending from your portfolio in short-term, fixed-income investments, which now, due to higher interest rates, offer better income opportunities.)

• Contribute to a 529 plan. You could use some of your extra Social Security money to contribute to a tax-advantaged 529 education savings plan for your grandchildren or other family members. 

• Contribute to charitable organizations. You might want to use some of your Social Security money to expand your charitable giving. Your generosity will help worthy groups and possibly bring you some tax benefits, too.

While it’s nice to have these possible options in 2023, you can’t count on future COLA increases being as large. The jump in inflation in 2022 was due to several unusual factors, including pandemic-related government spending, supply shortages and the Russian invasion of Ukraine. It’s quite possible, perhaps even likely, that inflation will subside in 2023, which, in turn, would mean a smaller COLA bump in 2024.

Nonetheless, while you might not want to include large annual COLA increases as part of your long-term financial strategy, you may well choose to take advantage, in some of the ways described above, of the bigger Social Security checks you’ll receive in 2023. When opportunity knocks, you may want to open the door. 

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor Gerald Breen, Acton, MA - EdwardJones.com/Gerald-Breen
Edward Jones. Member SIPC.

Here’s an interesting statistic: Some 72% of retirees say one of their biggest fears is becoming a burden on their families, according to a 2021 survey by Age Wave and Edward Jones. Both before and during retirement, what steps can you take to avoid burdening your loved ones in the future? Here are a few suggestions:
 

• Build your retirement savings. The greater your financial resources, the less likely it becomes that you’d ever have to count on your grown children for financial support. You may have access to a 401(k) or similar retirement plan at work, so take advantage of it. Even with an employer-sponsored plan, you also may be eligible to contribute to an IRA. In addition to offering a variety of investment options, a 401(k) and IRA provide potential tax advantages. And once you do retire, be careful about how much you withdraw each year from your retirement plans and other investments.
• Plan for health care costs. Once you are retired, health care costs will be a significant expense. You may have Medicare, but you'll also want to consider your need for supplemental health insurance to cover traditional medical costs. And you’ll want to consider another potential health-related expense: long-term care. You may never need the services of a home health aide or a stay in a nursing home, but no one can predict the future.

• Create necessary legal documents. If something were to happen to you, and you didn’t have the appropriate legal documents in place, your loved ones could be placed in a bind, both financially and emotionally. That’s why it’s a good idea to create documents such as a durable financial power of attorney, which lets you name someone to manage your finances if you became incapacitated, and a durable power of attorney for health care, which allows someone to make medical decisions on your behalf if you can’t make them yourself. You’ll want to work with a legal professional to develop the documents appropriate for your needs.
• Evaluate your housing needs. As you enter retirement, you may want to evaluate your living situation. Could you downsize to a smaller home, or perhaps a condominium or apartment? Not only might you save money with such a move, but you could also end up relieving your grown children of the responsibilities and hassles involved in clearing out and selling your home should you become unable to do so yourself during the later years of your retirement.

It’s unfortunate, but recessions are a fairly normal part of the economic landscape. When a recession occurs, how might you be affected? The answer depends on your individual situation, but regardless of your circumstances, you might want to consider the items in this recession survival checklist:
 

A recession accompanied by a bear market is not pleasant. But by taking the appropriate steps, you can boost your chances of getting through a difficult period and staying on track toward your important financial goals. 

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor Mandy Calouro, Chelmsford, MA  - EdwardJones.com/Mandy-Calouro, Edward Jones, Member SIPC

As you go through life, you will likely have long- and short-term financial goals. But how will your strategies for meeting your long-term goals differ from those needed for your short-term ones?

If you’re like most people, your biggest long-term goal is achieving a comfortable retirement. And for this goal, a common strategy is putting away money in tax-advantaged retirement vehicles, such as your 401(k) and IRA.

So, how should you go about preparing for shorter-term goals, such as a family vacation, home renovation, wedding or major purchase?

For starters, determine what your goal is, how much you can spend on it and when you’ll need the money. Even if you can’t pinpoint a precise amount, you can develop a good estimate. Of course, the sooner you start this process, the better off you’ll be, because you’ll have more time to save.

Your next decision involves the manner in which you save for your short-term goal. Specifically, what savings or investment vehicles should you use? The answer will be different for everyone, but you need to make sure that your investments align with your risk tolerance and time horizon. And you’ll want to ensure, as much as possible, that a certain amount of money is available for you at the specific time you’ll need it.

If you aren’t able to save enough to reach a short-term goal, you have other options — you can borrow what you need, or you can potentially sell investments to cover the cost. How can you decide which choice is best?

To help make up your mind, you’ll first want to consider some of the most common borrowing options: credit cards, home equity loans, personal loans and margin loans. (A margin loan lets you borrow against the value of investments you already own). How might each of these loans fit into your overall financial strategy? Will the repayment schedule work with your cash flow and budget?

You’ll then want to compare the costs and benefits of borrowing, in whatever form, against selling investments. For example, if you can borrow at a lower interest rate compared to the return you think you can get from your investments, borrowing might be a reasonable choice. You’ll also need to consider other factors, such as your credit score, taxes, fees associated with selling investments and time needed to repay debts. If, for instance, selling investments will trigger a large amount of taxes, borrowing might be preferable. You’ll also want to consider whether there’s a penalty or high costs associated with selling investments. In addition, if you have a long time horizon for a loan, you may want to sell investments to avoid paying interest for a longer period of time, and thus driving up the overall cost of borrowing.          Finally, keep in mind that you may have built an investment mix designed to align with your goals and risk tolerance. If you were to sell any of these investments to meet short-term needs, you would want to consider the need to rebalance your portfolio to maintain your desired asset allocation.
As you can see, there’s a lot to think about when it comes to paying for short-term goals. But by carefully evaluating your options, you can make the choices that are right for your needs.

This article was written by Edward Jones for use by your local Edward Jones Financial Advisor Alan Bell, Edward Jones, Member SIPC.

You may have heard that you can simplify your investment strategy just by owning index-based or passive investments. But is this a good idea? You’ll want to consider the different aspects of this type of investment style. 
 

To begin with, an index-based investment is a vehicle such as a mutual fund or an exchange-traded fund (ETF) that mimics the performance of a market benchmark, or index — the Dow Jones Industrial Average, the S&P 500, and so on. (An ETF is similar to a mutual fund in that it holds a variety of investments but differs in that it is traded like a common stock.) You can also invest in index funds that track the bond market. 
 

Index investing does offer some benefits. Most notably, it’s a buy-and-hold strategy, which is typically more effective than a market-timing approach, in which individuals try to buy investments when their prices are down and sell them when the prices rise. Attempts to time the market this way are usually futile because nobody can really predict when high and low points will be reached. Plus, the very act of constantly buying and selling investments can generate commissions and fees, which can lower your overall rate of return. Thus, index investing generally involves lower fees and is considered more tax efficient than a more active investing style. Also, when the financial markets are soaring, which happened for several years until this year’s downturn, index-based investments can certainly look pretty good — after all, when the major indexes go up, index funds will do the same.
 

Conversely, during a correction, when the market drops at least 10% from recent highs, or during a bear market, when prices fall 20% or more, index-based investments will likely follow the same downward path. 
 

And there are also other issues to consider with index-based investments. For one thing, if you’re investing with the objective of matching an index, you may be overlooking the key factors that should be driving your investment decisions — your goals and your risk tolerance. An index is a completely impersonal benchmark measuring the performance of a specific set of investments — but it can’t be a measuring stick of your own progress.
 

Ultimately, diversifying across different types of investments that align with your risk tolerance and goals — regardless of whether they track an index — is the most important consideration for your investment portfolio. Use this idea as your guiding principle as you journey through the investment world.