Nvest Financial Group, LLCNvest Financial Group, LLC

69 York Street, Suite 1 • Kennebunk • ME • 04043207-985-8585 • 603-766-0471info@nvestfinancial.com • www.nvestfinancial.com

Foreign Tourists

July 2020See disclaimer on final page

The hot long days of summer are a bit different this year, given the current situation. We hope you and your family are keeping safe and healthy. Although we all want to, and hopefully can,enjoy the beaches, family and friend cookouts and the overall joys of summer, it is still important for all of us to be smart about it.

As a reminder, both Nvest offices are open and accepting live meetings, with appropriate precautions being taken to protect you and our staff. However, if you feel more comfortable with anonline meeting, please feel free to continue requesting such. Also, both Nvest offices will be closed on Friday, July 3rd in observance of Independence Day and will reopen on Monday, July6th at 9:00AM.

We hope you and your loved ones have a safe and enjoyable summer! Please visit our website at www.nvestfinancial.com to check out our latest news, articles, and announcements. Shouldyou have any questions, please do not hesitate to contact us.

Warmly,

All at Nvest

More than 79 million foreign tourists visited the United States in 2019, adding $254 billion to the U.S. economy.Residents of Canada and Mexico accounted for almost half of the total, while the countries below were the top10 sources of overseas visitors. Travel restrictions and lockdowns due to COVID-19 have severely disrupted theflow of foreign tourists in 2020. It's too early to know the full extent of the damage to the tourism sector, but theeffects may continue for some time after the virus is controlled.

Source: National Travel and Tourism Office, 2020

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Tapping Retirement Savings During a Financial CrisisAs the number of COVID-19 cases began to skyrocketin March 2020, Congress passed the Coronavirus Aid,Relief, and Economic Security (CARES) Act. Thelegislation may make it easier for Americans to accessmoney in their retirement plans, temporarily waivingthe 10% early-withdrawal penalty and increasing theamount they could borrow. Understanding these newguidelines and the other rules for loans and earlywithdrawals may help you determine if they areappropriate options during a financial crisis.(Remember that tapping retirement savings now couldrisk your financial situation in the future.)

Penalty-Free WithdrawalsThe newest exception to the 10% early-withdrawalpenalty allows IRA account holders and retirementplan participants to take distributions of up to $100,000in 2020 for a "coronavirus-related" reason.* Thesesituations include a diagnosis of COVID-19 for accountowners and certain family members; a financialsetback due to a quarantine, furlough, layoff, orreduced work hours, and in the case of businessowners, due to closures or reduced hours; or aninability to work due to lack of child care as a result ofthe virus. This temporary exception augments theother circumstances for which a penalty-freedistribution is typically allowed:

• Death or disability of the account owner• Unreimbursed medical expenses exceeding 7.5% of

adjusted gross income (increases to 10% in 2021)• A series of "substantially equal periodic payments"

over your life expectancy or the joint life expectancyof you and your spouse

• Birth or adoption of a child, up to $5,000 per accountowner

• Certain cases when military reservists are called toactive duty

In addition, IRAs (but not work-based plans) allowpenalty-free withdrawals for a first-time homepurchase ($10,000 lifetime limit), qualifiedhigher-education expenses, and payments of healthinsurance premiums in the event of a layoff.

Five Industries Most Likely to Offer Retirement Plan LoansPercentage of plans that offer loans, by type of industry3

Work-based plans allow exceptions for those whoseparate from service after age 55 (50 in the case ofqualified public safety employees) and distributions aspart of a qualified domestic relations order.

Tax ConsequencesPenalty-free does not mean tax-free, however. In mostcases, when you take a penalty-free distribution, youmust report the full amount of the distribution on yourincome tax return for that year. However, the incomeassociated with a coronavirus-related distribution canbe spread over three years for tax purposes, with up tothree years to reinvest the money.1

Retirement Plan LoansIf your work-based retirement plan allows loans, youtypically can borrow up to the lesser of 50% of yourvested balance or $50,000. Most loans must be repaidwithin five years, but if the money is used to purchasea primary residence, the repayment period may belonger. The CARES Act permits employers to increasethis amount to the lesser of 100% of the vestedbalance or $100,000 for loans to coronavirus-affectedindividuals made between March 27, 2020, andSeptember 22, 2020.* Affected participants who haveoutstanding loans on or after March 27, 2020, will beable to delay any payments due in 2020 by one year.2

Hardship WithdrawalsMany work-based retirement plans also permithardship withdrawals in certain circumstances.Although these distributions are not exempt from the10% early-withdrawal penalty, they can be a lifeline forpeople who need money in an emergency.

For more information about your options, contact yourIRA or retirement plan administrator.

*Employers do not have to adopt the new withdrawaland loan provisions.1) Amounts reinvested may reduce your tax obligation on the distributions;however, due to the timing of distributions and required tax filings, you mayhave to file an amended return to seek a refund on any taxes previouslypaid on withdrawn amounts. 2) The original five-year repayment period willbe extended for the delay, but interest will continue to accrue. 3) Source:Plan Sponsor Council of America, 2019 (2018 data)

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Portfolio Performance: Choose Your Benchmarks WiselyDramatic market turbulence has been common in2020, and you can't help but hear about the frequentups and downs of the Dow Jones Industrial Average orthe S&P 500 index. The performance of these majorindexes is widely reported and analyzed in detail byfinancial news outlets around the nation.

Both the Dow and the S&P 500 track the stocks oflarge domestic companies. But with about 500 stockscompared to the Dow's 30, the S&P 500 comprises amuch broader segment of the market and isconsidered to be representative of U.S. stocks ingeneral. These indexes are useful tools for trackingstock market trends; however, some investorsmistakenly think of them as benchmarks for theperformance of their own portfolios

It doesn't make sense to compare a broadlydiversified, multi-asset portfolio to just one of its owncomponents. Expecting portfolio returns to meet orbeat "the market" in good times is usually unrealistic,unless you are willing to expose 100% of your savingsto the risk and volatility associated with stockinvestments. On the other hand, if you have awell-diversified portfolio, you might be happy to seethat your portfolio doesn't lose as much as the marketwhen stocks are falling.

Asset Allocation: It's PersonalInvestor portfolios are typically divided among assetclasses that tend to perform differently under differentmarket conditions. An appropriate mix of stocks,bonds, and other investments depends on theinvestor's age, risk tolerance, and financial goals.

Consequently, there may not be a single benchmarkthat matches your actual holdings and the compositionof your individual portfolio. It could take a combinationof several benchmarks to provide a meaningfulperformance picture. There are hundreds of indexesbased on a wide variety of markets (domestic/foreign),asset classes (stocks/bonds), market segments (largecap/small cap), styles (growth/value), and othercriteria.

Keep the Proper PerspectiveSeasoned investors understand that short-term resultsmay have little to do with the effectiveness of along-term investment strategy. Even so, the desire tobecome a more disciplined investor is often tested bythe arrival of your account statements.

Making decisions based on last year's — or last month's— performance figures may not be wise, because assetclasses, market segments, and industries do notalways perform the same from one period to the next.When an investment experiences dramatic upsideperformance, much of the opportunity for market gainsmay have already passed. Conversely, moving out ofan investment when it has a down period could takeyou out of a position to benefit when that marketsegment starts to recover.

There's nothing you can do about global economicconditions or the level of returns delivered by thefinancial markets, but you can control the compositionof your portfolio. Evaluating investment results throughthe correct lens may help you make appropriateadjustments and plan effectively for the future.

The performance of an unmanaged index is notindicative of the performance of any specific security,and individuals cannot invest directly in an index.Asset allocation and diversification are methods usedto help manage investment risk; they do not guaranteea profit or protect against investment loss. Allinvestments are subject to market fluctuation, risk, andloss of principal. Shares, when sold, may be worthmore or less than their original cost. Investments thatseek a higher return tend to involve greater risk.

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Debit or Credit? Pick a Card

Prepared by Broadridge Investor Communication Solutions, Inc. Copyright 2020

Securities offered thru Commonwealth Financial Network; Member FINRA/SIPC. Investment Advisory Services maybe offered thruCommonwealth Financial Network, a Registered Investment Adviser and/or Nvest Financial Group, a Maine and New Hampshire licensedInvestment Adviser. Advisory Services offered by Nvest Financial Group, LLC are separate and unrelated to Commonwealth. Fixedinsurance products and services offered through CES Insurance AgencyThe accompanying pages have been developed by an independent third party. Commonwealth Financial Network is not responsible fortheir content and does not guarantee their accuracy or completeness, and they should not be relied upon as such. These materials aregeneral in nature and do not address your specific situation. For your specific investment needs, please discuss your individualcircumstances with your representative. Commonwealth does not provide tax or legal advice, and nothing in the accompanying pagesshould be construed as specific tax or legal advice. Securities offered through Commonwealth Financial Network, Member FINRA/SIPC.

Americans use debit cards more often than creditcards, but they tend to use credit cards forhigher-dollar transactions. The average value of adebit-card transaction in 2018 was just $36, whilecredit-card transactions averaged $89.1

This usage reflects fundamental differences betweenthe two types of cards. A debit card acts like a plasticcheck and draws directly from your checking account,whereas a credit-card transaction is a loan thatremains interest-free only if you pay your monthly billon time. For this reason, people may use a debit cardfor regular expenses and a credit card for "extras."However, when deciding which card to use, youshould be aware of other differences.

Fraud protection. In general, you are liable for nomore than $50 in fraudulent credit-card charges. Fordebit cards, a $50 limit applies only if a lost card orPIN is reported within 48 hours. The limit is $500 ifreported within 60 days, with unlimited liability afterthat. A credit card may be safer in higher-risksituations, such as when shopping online, when thecard will leave your sight (as in a restaurant), or whenyou are concerned about the security of a card reader.If you regularly use a debit card in these situations,you may want to maintain a lower checking balanceand keep most of your funds in savings.

Merchant disputes. You can dispute a credit-cardcharge before paying your bill and shouldn't have topay it while the charge is under dispute. Disputing adebit-card charge can be more difficult when thecharge has been deducted from your checkingaccount, and it may take some time before the fundsare returned.

Rewards and extra benefits. Debit cards offer little orno additional benefits, whereas some credit cards offercash-back rewards, and major cards may include extrabenefits such as travel insurance, extendedwarranties, and secondary collision and theft coveragefor rental cars (up to policy limits). Of course, if you donot pay your credit-card bill in full each month, theinterest you pay can outweigh any financial rewards orbenefits.

Credit history. Using a credit card can affect yourcredit score positively or negatively, depending on howyou use it. A debit card does not affect your creditscore.

Considering the additional protections and benefits, acredit card may be a better choice in some situations —but only if you pay your monthly bill on time.1) Federal Reserve, 2019

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