In this issue

Healthcare and Retirement: Four Things to Consider Today

401(k) IN FOCUS

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401(k) SOLUTIONS

August 2017

Quarterly Market Update p. 5

Is 10% Right for Me? p. 7

Understanding Roth 401(k) p. 8

Healthcare and Retirement: Four Things to Consider Today

2 AUGUST 2017

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401(k) SOLUTIONS

You already know the importance of saving for retirement

and putting aside money in your 401(k) for things like paying

off your mortgage, future vacations, and pursuing your

hobbies. But have you considered the day-to-day needs

you’ll face in retirement, like how to pay for healthcare

when you’re no longer able to work?

Healthcare costs are already a concern for most Americans,

and they’re only going up. Assisted living facilities,

additional medical appointments, potential surgeries, and

long-term medications can drain the healthiest retirement

savings. If you haven’t considered the cost of your future

healthcare needs, the time to start researching—and

acting—is now.

3AUGUST 2017

Save Today

Your 401(k) plan is one of the best ways to save for your

financial needs in retirement, including healthcare costs.

A key benefit of a 401(k) is that it allows you to save and

invest money directly from your paycheck, on a regular

basis, before any taxes are withheld. For 2017, you are

allowed to contribute up to $18,000, pre-tax! This goes up

to $24,000 if you are age 50 or older.

You may also have access to a Healthcare Savings Account

(HSA), another great way to set money aside for your

health costs. Healthcare Savings Accounts allow you to

save up to $3,400 per year for an individual, or $6,750 for

family coverage, tax free. Withdrawals are also made tax-

free, as long as they are used to pay qualified healthcare

expenses (before age 65). HSA funds do not have to be

spent at any particular time, meaning they are available for

your use throughout your working years and in retirement.

HSAs do have some drawbacks. To participate, you’ll be

required to participate in a high deductible health plan,

which won’t work for everyone’s current needs. Also, HSA

money can only be spent on specific healthcare costs

(without incurring a 20% penalty) before age 65. Finally,

because HSAs are intended for current medical concerns,

you’ll need to dip into your account to help cover costs

now, which makes using it to plan for your future healthcare

needs difficult.

Live Long and Prosper

Wondering how much you’ll need to save to cover your

retirement healthcare costs? Consider this: In 2016, a

retired 65-year-old couple would have needed to have

about $270,000 saved to be 90% certain that they would

be able to pay for their healthcare expenses throughout

retirement.1 And that number is going up.

Many factors play a part in determining how much you’ll

need for your future, including your current health, lifestyle,

and family medical history. Each of these contributes to

your longevity, which in turn, will also affect your medical

costs. A longer life may come with the need for long-term

care, additional years of treatments, and more medications.

So how much should you save? There are some great online

tools that can help you make an educated guess about both

your personal longevity and your potential costs. Check

out the Living to 100 Life Expectancy Calculator,² where

you can answer detailed questions about your family’s

medical history, as well as your lifestyle, and receive an

educated guesstimate you can use for planning. AARP also

has the Health Care Costs Calculator, a great tool to help

you forecast how much you should plan to save for your

retirement healthcare costs.3

Medicare Won’t Cut It

Understanding and navigating Medicare can be complex

and confusing. Doing some personal research on how the

program works and your coverage options is important.

Also, remember that retirement sometimes comes sooner

than expected. Unforeseen family concerns or medical

issues can disrupt the best laid plans. It’s important to

research and understand Medicare and other insurance

options well in advance of when you’ll actually need them.

That way, if you need to retire earlier than planned, you

can rest easy knowing you understand your options, costs,

and responsibilities.

4 AUGUST 2017

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401(k) SOLUTIONS

Baby Steps to a Healthier You

Looking for small but significant ways to create a healthier

you now is a great way to affect your future health today.

Eating less sugar, exercising 30 minutes a day, going to

your regular preventative health checkups, meditating,

and letting go of unhealthy addictions or habits are all

examples of ways you can potentially improve your health

and quality of life.

Be sure to give yourself time and patience as you introduce

new activities, foods, and behaviors. And don’t try to do

everything all at once—pick and follow through on one

step at a time until your new healthy choice becomes a

healthy habit. Small, significant changes like these will

leave you feeling stronger, more youthful, and happier

today. You can improve your health, be more active, and

you may even see reduced health care costs in your future.

Planning for all aspects of retirement, from the exciting

trips to your day-to-day needs, is your chance to create the

future you’ve dreamed of. Take the time to consider your

future now: It’s a great way to help make your retirement

more comfortable, healthy, and fun.

1Employee Benefit Research Institute, 2016.2Go to www.livingto100.com. 3Go to www.aarp.org.

In 2016, a retired 65-year-old

couple would have needed

to have about $270,000

saved to be 90% certain that

they would be able to pay

for their healthcare expenses

though out retirement.1 And

that number is going up.

5AUGUST 2017

Quarterly Market Update from the Fisher Investments Investment Policy CommitteeGlobal markets tacked another 4.0% onto their 2017 rise

in Q2, bringing year to date returns to 10.7%. Non-U.S.

stocks again outperformed, with European stocks faring

particularly well. We see 2017’s back half as amplifying early-

year trends, and all seems on track for a great 2017 led by

non-U.S. stocks. Q2 was strong, but stocks didn’t move straight up—they

never do. European and Technology shares outperformed

in Q2 but wobbled a bit mid-quarter, leading pundits to

muse the year’s great start may be unraveling—a myopic

viewpoint, in our view. Recent waffling looks quite typical

of U.S. presidents’ inaugural years. Since 1970, when good

sector-level data begin, the non-U.S. sectors and countries

leading in inaugural-year Q1s have outperformed for the

full year the majority of the time, frequently gaining steam

in the second half. Yet leadership often fluctuates or cools

some in Q2—shaking out faithless investors. In his April

24 column for Britain’s Financial Times, Ken Fisher called

inaugural years’ second quarters “relatively quiet compared

to the year’s back half.” History strongly argues Q1 is the

guide, suggesting a sunny second half awaits for the year’s

early leaders.

While we expect the bull market to continue with gusto in

the period ahead, a correction—a short, sharp, sentiment-

driven decline exceeding -10%—is always possible.

Corrections are entirely random, coming and going with

little discernible reason amid significant media fanfare. It

doesn’t approach the magnitude (as of this writing), but

corrections share these features with the much-ballyhooed

recent volatility in big Tech—the so-called FANG or FAAMG

stocks. To us, these gyrations look typical of a quick reversal

or counter-trend. Ken’s friend Jim Cramer first dubbed the

now ubiquitous Facebook, Amazon, Netflix, and Google the

“FANGs” in 2013. It was mostly a CNBC curiosity until they

plunged on June 9, rendering FANG front-page fodder.

Two days later, media added Apple and swapped Netflix

for Microsoft, and FAAMG suddenly became a front-page

verb. Not just in The Wall Street Journal—regional papers

and even the front of USA Today’s “Money” section warned

against getting FAAMGed. Such fast, universal media

coverage is typical of short-term moves, not longer-term,

lasting negatives. To us, it recalls 2013’s short-lived “taper

tantrum” over quantitative easing’s potential end, 2010’s

“Flash Crash” and other flash-in-the-pan stories.

Universal bandwagon jumping is a hallmark of quick swings.

Markets discount widely known information, and the

bandwagon simply saps surprise power. Long-term trends

play out so slowly in part because there is no hype machine,

making folks much slower to catch on.

In our view, FANG hype is distracting from other, more

meaningful developments—chiefly, another year of falling

uncertainty, which is right on track. President Trump is filling

out his administration to little fanfare while accomplishing

much less than hoped or feared. Meanwhile, media

continues losing credibility by overselling the Comey and

6 AUGUST 2017

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401(k) SOLUTIONS

Sessions hearings (which under-delivered), reveling in Sean

Spicer’s disappearing act and covfefe jokes, burying more

important considerations for investors: After President

Trump’s five-plus months in office, we have a good sense of

his relative political muscle. Businesses and investors largely

know what they’re dealing with, enabling risk-taking.

While uncertainty is falling somewhat in America, the real

nexus is Europe, where euroskeptic populist fears fizzled.

Three months ago, investors were tearing their hair out over

far-right, anti-euro French presidential candidate Marine Le

Pen and her Front National party. But she lost decisively to

centrist Emmanuel Macron, whose En Marche party then

took a solid majority in June’s Parliamentary contest while

voters relegated Le Pen to the fringes. Euroskepticism’s

decline in France and Holland bolstered sentiment,

assuaging fears over radicalism in Italy and Germany. U.K.

political uncertainty ticked up when PM Theresa May lost

her majority in June’s snap election, but renewed gridlock

should reduce legislative risk, helping clear the fog as the

year progresses.

Outside politics, we believe sentiment and fundamentals

support our bullishness on Europe. Animal spirits are

stirring in Europe, where economic data keep improving

and beating expectations. Corporate earnings, up nicely in

America, are soaring even higher abroad. Strong Emerging

Markets growth is boosting export-oriented Asia, especially

big Asian Technology companies. Meanwhile, sentiment is

still relatively sunnier toward America, creating more room

for positive surprise elsewhere. As uncertainty melts away

and investors appreciate these and other positives, we

believe stocks should enjoy a strong run.

– The Investment Policy Committee

1Source: FactSet, as of 07/03/2017. MSCI World Index return

with net dividends, 03/31/2017 – 06/30/2017 and 12/30/2016

– 06/30/2017.

FAQ–Ask a Retirement Counselor I’ve heard I should be putting 10% into my 401(k). How do I know if this is the right amount?

Great question! We regularly hear from industry resources

that we should save about 10% of our current pay to meet

our future income needs in retirement. Unfortunately,

there isn’t one right answer that will work for everyone.

We all have different living circumstances, life expectancy,

family medical history, housing situations, goals, time

left to save, and more. All of those differences make our

finances much like our fingerprints—different and unique

to each individual. And because we are so different,

following generalizations about something as important as

our financial future is definitely not the best way to meet

our retirement goals.

To have the best chance of making our personal goals a

reality, we need to identify our own unique circumstances

while also considering our time left to invest and the

standard of living we expect. These factors and more

should be considered when determining your personal

savings rate, or how much you put aside.

One of the best ways I’ve found to help determine a healthy

personal savings rate is to use a retirement calculator.

Retirement calculators are great tools that help you project

your retirement needs based on your current age. They’ll

ask questions like:

• At what age would you like to retire?

• How much money do you already have saved?

• How much do you want or need to be able to

spend each year during retirement?

They then take that information and calculate an

approximate percentage or amount you should withhold

from your paycheck.

It’s important to remember that as your circumstances

change, your personal savings rate should change too.

We recommend using a retirement calculator on a yearly

basis to review your personal information and update your

401(k) contribution. This will help keep you on track to

retirement readiness.

There are many retirement calculators, but be forewarned:

not all are created equal. Quality calculators account for

inflation and allow you to adjust the rate of return you

expect to get on your investments. Be sure to check out our

Fisher Investments 401(k) Solutions Retirement Calculator,

and give us a call with any questions at 888-322-7586.

7AUGUST 2017

About John KleinJohn Klein is a Retirement Counselor for Fisher 401(k) Solutions. He brings more than a decade of experience in financial planning and retirement education to his clients. John enjoys motivating employees and helping them get the most out of their company retirement plans.

John earned his B.S. in Business Administration and Psychology from Southern Illinois University, Carbondale.

8

Understanding Roth 401(k)You’re already putting money in your 401(k) each

month, but have you considered contributing to

your Roth 401(k)? Maybe you don’t know what

a Roth 401(k) is. If not, you aren’t alone—most

Americans don’t understand the differences between

a Traditional and Roth 401(k), the benefits of both,

and which option or combination of options will

help them best meet their retirement goals. And not

knowing may mean you’re missing out on significant

tax opportunities that may benefit you in retirement.

To help, we’ve created a short (2 minute) educational

video about Roth 401(k)s that you can view online.

From understanding the tax benefits of both options

to help identifying whether the Traditional, Roth,

or a blend of both options is best for you, our

video answers your basic questions and helps you

better understand what a Roth 401(k) is. Not sure

if your company offers a Roth 401(k) option? Ask

your HR representative, or give our friendly Help

Desk a call at 888-322-7586 for more information.

CONTACT US

If you have a 401(k) account serviced by Fisher Investments 401(k) Solutions and need help or have

any questions, please contact us at 888-322-7586. We can help you with your 401(k) account, including

assistance with technical issues, as well as other service needs. We can also help answer questions about

the latest news developments and what they may mean in terms of investments and retirement planning.

Fisher 401(k) Solutions Video

K02163V August 2017©2017 Fisher Investments.

Investing in stock markets involves the risk of loss. Past performance is never a guarantee of future returns. This newsletter is intended for educational purposes only. It constitutes the general views of Fisher Investments and should not be regarded as personalized investment or tax advice or as a representation of investment performance. No assurances are made that Fisher Investments will continue to hold these views, which may change at any time based on new information, analysis or reconsideration. In addition, no assurances are made regarding the accuracy of any forecast made herein. Not all past forecasts have been, nor future forecasts may be, as accurate as any contained herein.

ABOUT FISHER

Fisher Investments 401(k) Solutions is dedicated to helping business owners and their employees successfully

reach their retirement goals. We help people better optimize their retirement savings opportunities and

understand their retirement plan options through in-person enrollments, ongoing education and our live-

person Help Desk.