Lee McArthur Encourages Investors to Start Saving Today
Tuesday, April 17th, 2012
With the political parties advocating very different directions for the federal government and a presidential election in November, many investors – individuals and small businesses alike – are sitting on the sidelines to see what happens. According to Lee McArthur, a registered representative of New York Life, that is a mistake.
"With Obamacare being reviewed at the Supreme Court and the election in the fall, I'm hearing many small business clients say they don't want to make any decisions until we get past Nov. 1. They don't know what they need to cover health care for employees and they don't know what's down the road in terms of taxes," McArthur said.
"I still believe there are some things small business owners and individuals can do now. They can at least make a monthly investment in a low-risk investment vehicle that will let them sleep at night."
McArthur manages the New York Life agency in Valdosta, Ga. Founded in 1845, New York Life Insurance Company is the largest mutual life insurance company in the United States and one of the largest life insurers in the world. It offers life insurance, retirement income, investments and long-term care insurance.
Finding Safety With Yield
According to McArthur, one of the biggest challenges investors face in today's market is finding safety for their funds with any kind of yield. With the Federal Reserve committed to keeping interest rates at historic lows through 2014, this challenge will persist for at least two years.
"I think there are three fixed-income investments that offer some yield with relatively low risk and those are municipal bonds, high-yield corporate bonds and cash-value life insurance," McArthur said.
"Of course you still have to be careful about credit quality especially with municipalities facing greater fiscal distress. But I think there are many good quality investment candidates in all three areas."
In the equity markets, McArthur believes that return on investment in the short-run will not be as high as most investors would like it to be. In recent weeks, all major stock indices have recorded relative highs that in some cases rival their pre-recession levels.
"I think you have to be very tactical in the stock market right now. The opportunities are few, in my opinion, although developing markets and large cap stocks offer some," McArthur said.
Optimistic Near-Term and Long-Term But…
McArthur is "cautiously optimistic" that the equity and fixed-income markets will deliver good returns in 2012. He also feels good about returns over the coming 10-year period.
"History says that the markets will deliver solid returns over almost any 10-year period," he said. "And I think issues we face today like the European debt crisis will be resolved by then."
The more difficult outlook is for the next two to five years. According to McArthur, there are just too many moving parts to develop a good projection of returns over that time period.
His advice for investors? Create a floor for the downside risk in your investment portfolio. For example, New York Life offers investment vehicles that guarantee your capital investment.
"We can't guarantee growth, but we can guarantee the downside. Our goal is to grow your investment, but at least you can sleep at night knowing your money is safe. It's not the right vehicle for every investor – it depends on your financial objectives."
For more information, contact Lee McArthur at [email protected] or (229) 740-2415.
