Welcome to our 30th year, and yes, I’m bragging. When I opened our doors in May of 1984, it was just in time to witness the fai l ing of half the savings and loan institutions thanks to an early 80s deregulation of the banking industry. (You’d think they would have learned and spared us 2008?) Interest rates were in double digits, as was unemployment; there was an inflationary hangover, having feasted on gold, real estate and oil & gas during the 70s, which had been kicked in the rear by then. Gold dropped by almost 65% off its high to $303 the year we opened, and kept going lower.* Even the stock market crashed in 1984, just before it took wings and hardly looked back. It was slightly over 1000 at the time. The investment mood was dour. Nothing was doing well. Maybe it wasn’t the best time to open a financial planning and investment counseling firm. But I did, and with lots of talent and brilliant assistance, here we are 30 years later and proud to be among the top wealth management firms in the nation. Without your confidence we wouldn’t be here, so I thank you deeply from all of us. And we’ll continue, as always, to work hard to earn it.

Since we’ve evolved over the years from a Financial Planning firm into a Wealth Management firm, many have asked about the difference. The basic goal of financial planning is to help one design a secure path to wealth or, at the very least, financial well-being. Today our clients come to us already with wealth and pretty well planned, and although there often are financial planning tweaks to be considered, our firm’s emphasis is on helping to manage the assets that come along with that relationship. We’ve always been all about helping to make each client’s financial trip through life as smooth and easy as possible, no matter what the circumstances. That will never change.

This was a fun year to manage money, and as Todd and Hugo will relay, next year might be sweet as well. Just be sure to check your risk tolerance from time to time, as will we. It’s amazing how it goes up with great markets and down with rough ones. If only we had all “backed up the truck” in 1984.

Speaking of markets, both Todd and I have been called upon to par ticipate in some segments on CNBC during the afternoon market repor t. It’s a compliment and it’s fun. Check out our website MegGreen.com for replays. Our autographs available upon request. :-)

Hope you enjoy the newsletter and all the information it brings. Our clients have their consolidated year-end MG&A statements enclosed, perhaps the last year for these as we move into repor ting heaven with our new online systems. It’ll only get better.

I wish you wellness, happiness, lots of love and lots of fun for the New Year. So glad we’re “in this” together.

Meg Green, CFP®

Chief Executive Officer

30TH ANNIVERSARY 1984 2014

Meg Green, CFP®

Founder and CEOMeg Green & Associates

Dear Client/Friend,

*Only Gold Historical London spot prices.

Market Overview 2013

2014 Trends and Opportunities

Headlines continued to taunt investors in 2013 as excessive coverage of the fiscal cliff, sequestration,

budget deal and debt ceiling made embracing this bull market difficult for many investors. Unrelenting

news coverage that the Fed might reduce their monthly bond buying led to a tiny “taper” tantrum

in September. However, investors with a longer-term view, discipline and a little thick skin received

some sweet returns to go with a year full of bitter “news.” As the char t below indicates, stock

markets registered very sizeable returns while traditionally lower risk investments offered subpar to

slightly negative results.

The best lesson of 2013 may have been that investors should

stop stressing over headlines, tweets and ever-present news

flashes and not try to “Washington-proof ” their por tfolio.

Even in a year of so many worries, what ifs and maybes,

a well-diversified por tfolio generated ample returns.

Fur thermore, most rewarding to investors and their advisors

effor ts are those focused on asset allocation, manager

research and selection, and tax-management. These are the

areas of exper tise that our Investment Management Team

is dedicated to bringing to each and every client under

our care.

Todd BattagliaPresident

2013 MARKET RESULTS

Source: Morningstar Inc.

With equity markets in the US hitting new all-time highs, bubble fears are in the air once again. If history is any guide, however, great years in the stock market (over 20% returns) are usually followed by good years (average returns of 10%). While plenty of skepticism about the sustainability of this bullish cycle exists, we feel plenty of positive trends are in place and even some mega-trends (longer-term events) that we feel offer plenty of upside potential for investors over the next few years:

1) TREND: Improving Confi dence – Psychology can play a big role in market behavior. When consumer confi dence is at extremes, it can create a multiplier effect on momentum leading to frothy highs and black swan lows. We feel confi dence is going to continue to improve in the new year. The biggest contributors to consumer confidence are housing, employment, stock markets and gasoline prices.1

All four areas have improved in the past year creating a sizeable wealth-effect that should keep the investment engine running strong in the risk-on markets such as stocks, real estate and new business formations (people star ting new companies).

OPPORTUNITY: US Equity Markets – While US companies are expected to continue growing earnings in 2014, confi dence can help put some extra oomph behind it leading to higher stock prices and in turn creating a vir tuous economic cycle. The char t below shows how price/earnings multiples (P/Es) can expand as consumer confidence increases. This means investors are willing to buy stocks at higher prices for the same amount of earnings per share. This is because investors are confident about the

future as they feel, and in many cases are, “wealthier.” Confi dence-driven P/E expansion can extend bull markets for many years and to much higher levels. We believe US equities will continue their rise in 2014 as a result of continued earnings growth, suppor ted by an improving economy, and from a big helping of confidence.

CONFIDENCE, EARNINGS & MULTIPLES

Source: JP Morgan, Guide to Markets, 1Q20141 JP Morgan, Market Insights, 12/31/13

“…investors should stop stressing over headlines…”

If you would like a current copy of our ADV Part II of Sterne Agee Financial Services Inc. or Meg Green & Associates Inc., please contact Gigi and she will send it to you.

2) MEGA-TREND: Energy Revolution – Energy has become a competitive weapon for the US, promoting and advancing economic prosperity, military security and a better standard of living for its citizens.2 And yet, we are only in the early stages of this new era and are still learning how to flex our energy muscle. Many studies show that advances in horizontal drilling (called fracking) will unlock hundreds of billions of dollars of oil and gas “trapped” within shale formations across the US. The energy boom offers many benefits including:

Lots of jobs country-wide in the energy and manufacturing sectors. It’s a jobs machine!

Many “instant” millionaire land owners in Texas, Pennsylvania, Ohio, North Dakota and several other states.

Abundant and affordable energy that acts as a tax cut for consumers and businesses creating a wealth effect that will ripple through the global economy.

A manufacturing renaissance in the US due to low natural gas prices. This bodes well for “Market Street” as every $1.00 spent in manufacturing adds another $1.48 to the economy… the highest multiplier effect of any economic sector.3

Source: U.S. Energy Information Administration,

BENTEK 12/31/12

U.S. CRUDE OIL AND NATURAL GAS PRODUCTIONOPPORTUNITY: MLP Stocks – While the US economy and markets should benefi t on many fronts from this new energy era, we believe a focused energy investment has merit. We fi nd exploration and drilling investments a bit speculative for our blood. However, we feel Master Limited Partnerships (MLPs), also known as pipeline companies, offer a conservative energy option. Pipelines provide transportation of gas and oil from drilling sites to refi neries, storage facilities, and exporting hubs. Like a toll booth, these companies collect fees for energy transportation. MLPs are ideal for income-minded investors as they offer compelling tax-effi cient yields in the 5-6% range. They also offer growth potential as experts estimate that it may take trillions of dollars of infrastructure investment to keep up with future gas and oil production as illustrated in the chart to the right.

3) MEGA-TREND: Middle Class Explosion – The global middle class (bourgeoisie) will more than double from 2 billion today to 4.9 billion by 2030. The International Monetary Fund (IMF) estimates that 60 million people will enter the middle class each year just in China and India combined, or about the population of Italy, for the next 20 years. The char t illustrates how the middle class demographic is expected to play out over the coming decades and the 150% increase in consumption power it will bring to the global market place.

The world has seen two great middle class expansions since the 1800s including the Industrial Revolution which benefi ted Western Europe and the US, and during the Post WWII era that heavily benefi ted Europe, North America and Japan. We are now entering the world’s third and largest middle class population boom in history.4 This mega-trend spells relief for economies around the world.

Source: Organization for Economic Co-Operation and Development, The Emerging Middle Class in Developing Countries, 2010

BURGEONING BOURGEOISIE

OPPORTUNITY: Emerging Market Equity and Debt – After surging 79% in 2009 emerging market (EM) equities have see-sawed since, and EM Debt, the darling of fi xed income this past decade, led declining major asset classes in 2013 with an unimpressive return of -6%. Why should one be enthused? We feel there are several good reasons:

Almost the entire middle class explosion is happening in the EM.5

Increasing middle class translates into major increases in consumer spending. Made in China may soon read… Sold in China!

The IMF forecasts that over the next 10 years almost 70% of world economic growth will come from EMs.6

EM countries have significantly lower Sovereign Debt than the US and other developed countries as a percentage of GDP.7

EM stocks are still 35% off their all-time highs and stocks have better fundamentals (e.g. lower P/E’s) than US and other developed market stocks.8

We believe that the emerging markets will benefit greatly over the next 20 years similar to the economic responses experienced in Europe, the US and Japan during their middle class surges. New capital should fl ow to these countries as economic benefi ts are realized from their younger populations trending upward in financial status. They’ll produce more and consume more than developed countries whose aging populations create strain on national pension systems and health care budgets.

2 ING Global Perspectives, December 12/31/13 3 Oppenheimer, Investment Viewpoints, 12/31/13

4 Ernst & Young, August 2013 5 TimesofMalta.com 10/24/13 6 T. Rowe Price, Insights, August 26, 2013 7 & 8 JP Morgan, Guide to the Markets 1Q2014

Investor Alert…Taxes on The Rise!New for 2013 are higher tax rates. For those in the highest brackets, expect an extra pinch from Uncle Sam on April 15th. A new maximum long-term capital gain and dividend tax rate of 20%, a reinstated 39.6% tax rate on taxable income and short-term capital gains, and a new Medicare tax rate of 3.8% bring new meaning to the adage that “it’s not what you make it’s what you keep that matters.” Clearly, a well-coordinated portfolio management approach that is sensitive to taxes has become more vital to protect and grow one’s wealth. That is why portfolio tax-management has been, and continues to be, a priority for us. Here are some of the things it entails:

Tax-Smart portfolio construction – We put tax-sensitive mutual funds, managers and asset classes in taxable accounts and keep the high turnover investments in the retirement accounts.

Year-round tax loss harvesting – Even big years in the market like 2013 have plenty of market dips where losses could be generated. We can book losses anytime of year to help with potential capital gains. Unused tax losses can be saved (carried forward) for future tax years.

Control for wash-sales – Booking tax losses is great, but you need to be careful. The IRS doesn’t allow you to buy the same security 30 days before or 30 days after you sold it in any account in a family’s household, including retirement accounts! If you do, the losses are not allowed for that tax year. Our state-of-the-art portfolio management software monitors wash-sales amongst all the accounts in a household to minimize this.

Proactive Tax-Planning – We communicate with clients and their tax professionals regularly during the year to make sure portfolio activity like realized gains and losses, retirement contributions, required minimum distributions, gifts of appreciated stock, and charitable contributions, are factored into your tax picture.

As a reminder, the better informed we are, the better we can do our job to help manage your wealth. For our clients, please have your tax professional forward a copy of your 2013 tax return to our office (or email our CPA liaison and VP of Compliance, Mallory Mangrum at mallory@meggreen.com) so we can make informed decisions and recommendations for your portfolio.

IRD… three little letters than can save you or your heirs a ton of taxes.

They stand for “Income in Receipt of a Decedent,” and it’s given to all types of taxable income earned, but not received by the decedent at the time of their passing. What do we mean? IRAs, pensions or 401k’s, income in annuities, unpaid interest or dividends, salary, wages and sales commissions not yet paid, but owed... things that would have been taxable to him or her had they lived.

IRD income is generally taxed at the benefi ciary’s ordinary income tax rate, so that IRA Rollover that Uncle Henry left you will be taxable at your rate upon withdrawal, no matter when.

UNLESS… Uncle Henry’s estate paid an estate tax on these IRD assets. In that case, you may be eligible for an IRD tax deduction based on the amount of estate taxes Uncle Henry’s estate paid. That could be a free and easy tax shelter. All you have to do is know about it and fi le accordingly.

Your CPA knows this, but with heirs, sometimes the whole picture doesn’t come through with the inheritance. Just wanted to make you aware.

4) TREND: Improving State and Local Finances – While 2013 saw its share of disappointments with Detroit at the top of the list, municipal finances continued to strengthen and the future is looking better. State’s finances have improved 15 consecutive quar ters and local government revenue is responding favorably to the improving US housing market and higher sales tax revenue.9

OPPORTUNITY: Municipal Bonds and High Yield Municipal Bonds – Municipal defaults are still low and those in recent years were not totally unexpected by por tfolio managers doing their job. The perception many investors have is that municipal bonds are “bad” right now because of default risk and interest rate risk. The reality is that municipal bonds are attractive for several reasons:

Excessive outflows in 2013 have created appealing credit spreads compared to other types of taxable fi xed income, especially for high yield municipal bonds.

State and Local governments have improved their budgets with fiscal austerity measures that are beginning to hit the bottom line.

Higher interest rates help by improving their pension funding status bringing much needed balance sheet relief.

Higher Federal income tax rates at 39.6%, phased-out itemized deductions and exemptions, and increasing State income tax rates make municipal bonds very attractive to wealthy investors.

Municipal bond income is not subject to the new 3.8% Medicare Tax.

They provide a predictable stream of high quality, dependable, tax-free income that is backed by state, and local governments that have historical default rates considerably lower than corporate bonds of similar quality.

It’s impor tant to be aware that plenty of challenges lay ahead in 2014 and headlines will once again test your intestinal for titude for risk as they try coaxing you to the sidelines for a “breather.” So be forewarned. While none of these events can be confidently predicted or anticipated, por tfolios can be structured to “weather” their deleterious effects. A well-balanced por tfolio of stocks, bonds, real estate, liquid alternatives and cash can go a long ways toward “Washington-proofing” your por tfolio or to protect against an occasional black swan.

For our clients, we look forward to reviewing your por tfolio and your allocations, as always, to make sure you are on the right track and positioned to take advantage of the next mega-trend. In the meantime, do not hesitate to contact us if you have any questions or concerns about the markets and/or upcoming events.

9 WSJ, In the Markets, 12/26/13

Our portfolio reporting received a much needed facelift in 2013,

which allows us to now customize and tailor your portfolio reports

to look the way you want to see them. Some prefer a simple

snapshot of their holdings, while others want extreme details, daily.

We’re happy to repor t (pardon the expression) that custom

tailored repor ts are now par t of your wealth management

experience at Meg Green & Associates.

As a result of our transition to Sterne Agee in the fall of 2012,

we also partnered with a public company called Envestnet,

a leading provider of integrated portfolio, practice management

and reporting solutions to fi nancial advisors and institutions.

We began rolling out our newly enhanced portfolio reports

just this past year. If you already use our online client portal,

you were the fi rst to be introduced to our new reporting.

Those of you not yet online who wish to be, please call our offi ce

to get hooked up. But not to worry. In addition to the reports

online, we are also presenting our new reports when you come

in for a review.

And for those CPAs we share clients with, be sure to ask for our

new tax estimate report. It is a useful tool for projecting clients'

tax liability from a portfolio point of view.

New Year…New Technology.

Watch Out…They’re Out to Get You!Sean O’Halloran, AWMA® Senior Wealth Manager

Every year identity thieves continue to improve their tactics. As a result, we do too. So please do not be surprised, or offended, if we ask a few questions to verify your identity when you call in. We all need to maintain a healthy skepticism when it comes to giving out personal information. Never give out your personal information due to an email request, letter request, or random call. There has been a rise in criminals impersonating people via emails and letters, as well as posing as actual fi nancial institutions. The imposters monitor your mail and online behavior. This allows them to look and sound just like you or a financial institution in a letter or email.

The best bet if you are contacted by someone asking to update your information, is to NOT give it at that time. A legitimate institution would never send a random letter or email asking for an update. Call the institution back using a familiar number like the one on the back of a credit card or on a monthly statement. Even better is to walk into a local branch if available. Of course, if you do not know the institution at all, just disregard the contact altogether.

Shred it all. Thieves will dig through your garbage to get personal information…your name, date of birth, credit card number, whatever is in there. Don’t give them the chance. If you don’t own a little shredder, get one.

Guard your social security number by giving it only when necessary, not just because you’re asked. Don’t write it on checks (except to the IRS), or keep it in your wallet. Be stingy with it. Having your social stolen can be a nightmare.

Choose passwords that aren’t as obvious as your bir thday or pet’s name. Use letters and numbers. Make it easy for you to remember but hard for someone to guess.

Keep in mind that we at Meg Green & Associates cannot accept any investment orders or wire instructions by email or voice message. We will need to speak to you first before initiating any transactions.

Let’s all have a safe New Year!

ASSET ALLOCATION

Equity 51.66%

• Large-Cap Growth 14.88%

•Large-Cap Core 12.28%

•Large-Cap Value 9.78%

•Mid-Cap Growth 1.37%

•Mid-Cap Core 2.92%

•Mid-Cap Value 1.00%

•Small-Cap Core 3.12%

•Small-Cap Value 1.34%

•REITs 4.98%

International 13.26%

•Int'l Developed Mkts 8.90%

•Int'l Emerging Mkts 4.36%

Global Equity 7.36%

•Global Equity 7.36%

Fixed Income 22.78%

•Emerging Markets Bond 1.48%

•Intermediate Bond 1.66%

•Long Muni 0.69%

•Intermediate Muni 8.31%

•Short Muni 1.26%

•High Yield 7.29%

•International Bond 2.08%

Cash 1.97%

•Cash 1.97%

Alternatives 2.59%

•Hedged Equity 1.31%

•Multi-Strategy 0.22

•Alternative Fixed Income 0.31%

•Alternative 0.75%

Other 0.38%

•Other 0.38%

Our Team

Securities offered through Sterne Agee Financial Services, Inc., member FINRA/SIPIC. Investment advisory services offered through Meg Green & Associates, Inc., a registered investment advisor not affi liated with Sterne Agee Financial Services, Inc.

This material is meant for general illustration and or informational purposes only. The views expressed are not necessarily the opinion of Sterne Agee Financial Services, Inc. This material should not be relied upon as investment strategy or purchasing any securities. Investors should note that there are risks inherent in all investments, such as fl uctuations in investment principal. Past performance of any index, investment or strategy cannot be relied upon as a guarantee of future results. This article contains forward looking statements and projections. There are no guarantees that these results will be achieved. The information here was obtained from sources believed to be reliable; however, it cannot be guaranteed. In general, the bond market is volatile as prices rise when interest rates fall and vice versa. This effect is usually pronounced for longer-term securities. Any fi xed income security sold or redeemed prior to maturity may be subject to a substantial gain or loss. The investor should note that vehicles that invest in lower-rated debt securities (commonly referred to as junk bonds) involve additional risks because of the lower credit quality of the securities in the portfolio. The investor should be aware of the possible higher level of volatility, and increased risk of default. International investing involves special risks including greater economic and political instability, as well as currency fl uctuation risks, which may be even greater in emerging markets. Investments in real estate have various risks including possible lack of liquidity and devaluation based on adverse economic and regulatory changes. Municipal bond offerings are subject to availability and change in price. If sold prior to maturity, municipal bonds may be subject to market and interest risk. An issuer may default on payment of the principal or interest of a bond. Bond values will decline as interest rates rise. Depending upon the municipal bond offered, alternative minimum tax and state/local taxes could apply. Municipal bonds may not be suitable for all investors. Please see your tax professional prior to investing.

2627 Ives Dairy Road, Suite 201, Miami, Florida 33180T: 305-931-1400 • 1-800-741-2004 • F: 305-931-6256

MegGreen.com

Top left to right

Mallory Mangrum, VP, Chief Compliance Offi cer; Todd Battaglia, President; Meg Green, CFP®, Chief Executive Offi cer; Kevin McGann, VP, Chief Operations Offi cer; Hugo Calenzani, Sr. Investment Strategist Offi cer

Seated left to right

Tere Spiegel, Sr. Client Services Associate; Sean O'Halloran, AWMA®, Sr. Wealth Manager; Gigi Wright, Executive Assistant; Jeremy Bailey, Wealth Management Associate; Amy Ortigosa, Client Services Associate

“Money is only a tool. It will take you wherever you wish, but it will never replace you as the driver.” Ayn Rand

Our portfolio reporting received a much needed facelift in 2013,

which allows us to now customize and tailor your portfolio reports

to look the way you want to see them. Some prefer a simple

snapshot of their holdings, while others want extreme details, daily.

We’re happy to repor t (pardon the expression) that custom

tailored repor ts are now par t of your wealth management

experience at Meg Green & Associates.

As a result of our transition to Sterne Agee in the fall of 2012,

we also partnered with a public company called Envestnet,

a leading provider of integrated portfolio, practice management

and reporting solutions to fi nancial advisors and institutions.

We began rolling out our newly enhanced portfolio reports

just this past year. If you already use our online client portal,

you were the fi rst to be introduced to our new reporting.

Those of you not yet online who wish to be, please call our offi ce

to get hooked up. But not to worry. In addition to the reports

online, we are also presenting our new reports when you come

in for a review.

And for those CPAs we share clients with, be sure to ask for our

new tax estimate report. It is a useful tool for projecting clients'

tax liability from a portfolio point of view.

New Year…New Technology.

Watch Out…They’re Out to Get You!Sean O’Halloran, AWMA® Senior Wealth Manager

Every year identity thieves continue to improve their tactics. As a result, we do too. So please do not be surprised, or offended, if we ask a few questions to verify your identity when you call in. We all need to maintain a healthy skepticism when it comes to giving out personal information. Never give out your personal information due to an email request, letter request, or random call. There has been a rise in criminals impersonating people via emails and letters, as well as posing as actual fi nancial institutions. The imposters monitor your mail and online behavior. This allows them to look and sound just like you or a financial institution in a letter or email.

The best bet if you are contacted by someone asking to update your information, is to NOT give it at that time. A legitimate institution would never send a random letter or email asking for an update. Call the institution back using a familiar number like the one on the back of a credit card or on a monthly statement. Even better is to walk into a local branch if available. Of course, if you do not know the institution at all, just disregard the contact altogether.

Shred it all. Thieves will dig through your garbage to get personal information…your name, date of birth, credit card number, whatever is in there. Don’t give them the chance. If you don’t own a little shredder, get one.

Guard your social security number by giving it only when necessary, not just because you’re asked. Don’t write it on checks (except to the IRS), or keep it in your wallet. Be stingy with it. Having your social stolen can be a nightmare.

Choose passwords that aren’t as obvious as your bir thday or pet’s name. Use letters and numbers. Make it easy for you to remember but hard for someone to guess.

Keep in mind that we at Meg Green & Associates cannot accept any investment orders or wire instructions by email or voice message. We will need to speak to you first before initiating any transactions.

Let’s all have a safe New Year!

ASSET ALLOCATION

Equity 51.66%

• Large-Cap Growth 14.88%

•Large-Cap Core 12.28%

•Large-Cap Value 9.78%

•Mid-Cap Growth 1.37%

•Mid-Cap Core 2.92%

•Mid-Cap Value 1.00%

•Small-Cap Core 3.12%

•Small-Cap Value 1.34%

•REITs 4.98%

International 13.26%

•Int'l Developed Mkts 8.90%

•Int'l Emerging Mkts 4.36%

Global Equity 7.36%

•Global Equity 7.36%

Fixed Income 22.78%

•Emerging Markets Bond 1.48%

•Intermediate Bond 1.66%

•Long Muni 0.69%

•Intermediate Muni 8.31%

•Short Muni 1.26%

•High Yield 7.29%

•International Bond 2.08%

Cash 1.97%

•Cash 1.97%

Alternatives 2.59%

•Hedged Equity 1.31%

•Multi-Strategy 0.22

•Alternative Fixed Income 0.31%

•Alternative 0.75%

Other 0.38%

•Other 0.38%

Our Team

Securities offered through Sterne Agee Financial Services, Inc., member FINRA/SIPIC. Investment advisory services offered through Meg Green & Associates, Inc., a registered investment advisor not affi liated with Sterne Agee Financial Services, Inc.

This material is meant for general illustration and or informational purposes only. The views expressed are not necessarily the opinion of Sterne Agee Financial Services, Inc. This material should not be relied upon as investment strategy or purchasing any securities. Investors should note that there are risks inherent in all investments, such as fl uctuations in investment principal. Past performance of any index, investment or strategy cannot be relied upon as a guarantee of future results. This article contains forward looking statements and projections. There are no guarantees that these results will be achieved. The information here was obtained from sources believed to be reliable; however, it cannot be guaranteed. In general, the bond market is volatile as prices rise when interest rates fall and vice versa. This effect is usually pronounced for longer-term securities. Any fi xed income security sold or redeemed prior to maturity may be subject to a substantial gain or loss. The investor should note that vehicles that invest in lower-rated debt securities (commonly referred to as junk bonds) involve additional risks because of the lower credit quality of the securities in the portfolio. The investor should be aware of the possible higher level of volatility, and increased risk of default. International investing involves special risks including greater economic and political instability, as well as currency fl uctuation risks, which may be even greater in emerging markets. Investments in real estate have various risks including possible lack of liquidity and devaluation based on adverse economic and regulatory changes. Municipal bond offerings are subject to availability and change in price. If sold prior to maturity, municipal bonds may be subject to market and interest risk. An issuer may default on payment of the principal or interest of a bond. Bond values will decline as interest rates rise. Depending upon the municipal bond offered, alternative minimum tax and state/local taxes could apply. Municipal bonds may not be suitable for all investors. Please see your tax professional prior to investing.

2627 Ives Dairy Road, Suite 201, Miami, Florida 33180T: 305-931-1400 • 1-800-741-2004 • F: 305-931-6256

MegGreen.com

Top left to right

Mallory Mangrum, VP, Chief Compliance Offi cer; Todd Battaglia, President; Meg Green, CFP®, Chief Executive Offi cer; Kevin McGann, VP, Chief Operations Offi cer; Hugo Calenzani, Sr. Investment Strategist Offi cer

Seated left to right

Tere Spiegel, Sr. Client Services Associate; Sean O'Halloran, AWMA®, Sr. Wealth Manager; Gigi Wright, Executive Assistant; Jeremy Bailey, Wealth Management Associate; Amy Ortigosa, Client Services Associate

“Money is only a tool. It will take you wherever you wish, but it will never replace you as the driver.” Ayn Rand

Welcome to our 30th year, and yes, I’m bragging. When I opened our doors in May of 1984, it was just in time to witness the fai l ing of half the savings and loan institutions thanks to an early 80s deregulation of the banking industry. (You’d think they would have learned and spared us 2008?) Interest rates were in double digits, as was unemployment; there was an inflationary hangover, having feasted on gold, real estate and oil & gas during the 70s, which had been kicked in the rear by then. Gold dropped by almost 65% off its high to $303 the year we opened, and kept going lower.* Even the stock market crashed in 1984, just before it took wings and hardly looked back. It was slightly over 1000 at the time. The investment mood was dour. Nothing was doing well. Maybe it wasn’t the best time to open a financial planning and investment counseling firm. But I did, and with lots of talent and brilliant assistance, here we are 30 years later and proud to be among the top wealth management firms in the nation. Without your confidence we wouldn’t be here, so I thank you deeply from all of us. And we’ll continue, as always, to work hard to earn it.

Since we’ve evolved over the years from a Financial Planning firm into a Wealth Management firm, many have asked about the difference. The basic goal of financial planning is to help one design a secure path to wealth or, at the very least, financial well-being. Today our clients come to us already with wealth and pretty well planned, and although there often are financial planning tweaks to be considered, our firm’s emphasis is on helping to manage the assets that come along with that relationship. We’ve always been all about helping to make each client’s financial trip through life as smooth and easy as possible, no matter what the circumstances. That will never change.

This was a fun year to manage money, and as Todd and Hugo will relay, next year might be sweet as well. Just be sure to check your risk tolerance from time to time, as will we. It’s amazing how it goes up with great markets and down with rough ones. If only we had all “backed up the truck” in 1984.

Speaking of markets, both Todd and I have been called upon to par ticipate in some segments on CNBC during the afternoon market repor t. It’s a compliment and it’s fun. Check out our website MegGreen.com for replays. Our autographs available upon request. :-)

Hope you enjoy the newsletter and all the information it brings. Our clients have their consolidated year-end MG&A statements enclosed, perhaps the last year for these as we move into repor ting heaven with our new online systems. It’ll only get better.

I wish you wellness, happiness, lots of love and lots of fun for the New Year. So glad we’re “in this” together.

Meg Green, CFP®

Chief Executive Officer

30TH ANNIVERSARY 1984 2014

Meg Green, CFP®

Founder and CEOMeg Green & Associates

Dear Client/Friend,

*Only Gold Historical London spot prices.

Market Overview 2013

2014 Trends and Opportunities

Headlines continued to taunt investors in 2013 as excessive coverage of the fiscal cliff, sequestration,

budget deal and debt ceiling made embracing this bull market difficult for many investors. Unrelenting

news coverage that the Fed might reduce their monthly bond buying led to a tiny “taper” tantrum

in September. However, investors with a longer-term view, discipline and a little thick skin received

some sweet returns to go with a year full of bitter “news.” As the char t below indicates, stock

markets registered very sizeable returns while traditionally lower risk investments offered subpar to

slightly negative results.

The best lesson of 2013 may have been that investors should

stop stressing over headlines, tweets and ever-present news

flashes and not try to “Washington-proof ” their por tfolio.

Even in a year of so many worries, what ifs and maybes,

a well-diversified por tfolio generated ample returns.

Fur thermore, most rewarding to investors and their advisors

effor ts are those focused on asset allocation, manager

research and selection, and tax-management. These are the

areas of exper tise that our Investment Management Team

is dedicated to bringing to each and every client under

our care.

Todd BattagliaPresident

2013 MARKET RESULTS

Source: Morningstar Inc.

With equity markets in the US hitting new all-time highs, bubble fears are in the air once again. If history is any guide, however, great years in the stock market (over 20% returns) are usually followed by good years (average returns of 10%). While plenty of skepticism about the sustainability of this bullish cycle exists, we feel plenty of positive trends are in place and even some mega-trends (longer-term events) that we feel offer plenty of upside potential for investors over the next few years:

1) TREND: Improving Confi dence – Psychology can play a big role in market behavior. When consumer confi dence is at extremes, it can create a multiplier effect on momentum leading to frothy highs and black swan lows. We feel confi dence is going to continue to improve in the new year. The biggest contributors to consumer confidence are housing, employment, stock markets and gasoline prices.1

All four areas have improved in the past year creating a sizeable wealth-effect that should keep the investment engine running strong in the risk-on markets such as stocks, real estate and new business formations (people star ting new companies).

OPPORTUNITY: US Equity Markets – While US companies are expected to continue growing earnings in 2014, confi dence can help put some extra oomph behind it leading to higher stock prices and in turn creating a vir tuous economic cycle. The char t below shows how price/earnings multiples (P/Es) can expand as consumer confidence increases. This means investors are willing to buy stocks at higher prices for the same amount of earnings per share. This is because investors are confident about the

future as they feel, and in many cases are, “wealthier.” Confi dence-driven P/E expansion can extend bull markets for many years and to much higher levels. We believe US equities will continue their rise in 2014 as a result of continued earnings growth, suppor ted by an improving economy, and from a big helping of confidence.

CONFIDENCE, EARNINGS & MULTIPLES

Source: JP Morgan, Guide to Markets, 1Q20141 JP Morgan, Market Insights, 12/31/13

“…investors should stop stressing over headlines…”

If you would like a current copy of our ADV Part II of Sterne Agee Financial Services Inc. or Meg Green & Associates Inc., please contact Gigi and she will send it to you.

2) MEGA-TREND: Energy Revolution – Energy has become a competitive weapon for the US, promoting and advancing economic prosperity, military security and a better standard of living for its citizens.2 And yet, we are only in the early stages of this new era and are still learning how to flex our energy muscle. Many studies show that advances in horizontal drilling (called fracking) will unlock hundreds of billions of dollars of oil and gas “trapped” within shale formations across the US. The energy boom offers many benefits including:

Lots of jobs country-wide in the energy and manufacturing sectors. It’s a jobs machine!

Many “instant” millionaire land owners in Texas, Pennsylvania, Ohio, North Dakota and several other states.

Abundant and affordable energy that acts as a tax cut for consumers and businesses creating a wealth effect that will ripple through the global economy.

A manufacturing renaissance in the US due to low natural gas prices. This bodes well for “Market Street” as every $1.00 spent in manufacturing adds another $1.48 to the economy… the highest multiplier effect of any economic sector.3

Source: U.S. Energy Information Administration,

BENTEK 12/31/12

U.S. CRUDE OIL AND NATURAL GAS PRODUCTIONOPPORTUNITY: MLP Stocks – While the US economy and markets should benefi t on many fronts from this new energy era, we believe a focused energy investment has merit. We fi nd exploration and drilling investments a bit speculative for our blood. However, we feel Master Limited Partnerships (MLPs), also known as pipeline companies, offer a conservative energy option. Pipelines provide transportation of gas and oil from drilling sites to refi neries, storage facilities, and exporting hubs. Like a toll booth, these companies collect fees for energy transportation. MLPs are ideal for income-minded investors as they offer compelling tax-effi cient yields in the 5-6% range. They also offer growth potential as experts estimate that it may take trillions of dollars of infrastructure investment to keep up with future gas and oil production as illustrated in the chart to the right.

3) MEGA-TREND: Middle Class Explosion – The global middle class (bourgeoisie) will more than double from 2 billion today to 4.9 billion by 2030. The International Monetary Fund (IMF) estimates that 60 million people will enter the middle class each year just in China and India combined, or about the population of Italy, for the next 20 years. The char t illustrates how the middle class demographic is expected to play out over the coming decades and the 150% increase in consumption power it will bring to the global market place.

The world has seen two great middle class expansions since the 1800s including the Industrial Revolution which benefi ted Western Europe and the US, and during the Post WWII era that heavily benefi ted Europe, North America and Japan. We are now entering the world’s third and largest middle class population boom in history.4 This mega-trend spells relief for economies around the world.

Source: Organization for Economic Co-Operation and Development, The Emerging Middle Class in Developing Countries, 2010

BURGEONING BOURGEOISIE

OPPORTUNITY: Emerging Market Equity and Debt – After surging 79% in 2009 emerging market (EM) equities have see-sawed since, and EM Debt, the darling of fi xed income this past decade, led declining major asset classes in 2013 with an unimpressive return of -6%. Why should one be enthused? We feel there are several good reasons:

Almost the entire middle class explosion is happening in the EM.5

Increasing middle class translates into major increases in consumer spending. Made in China may soon read… Sold in China!

The IMF forecasts that over the next 10 years almost 70% of world economic growth will come from EMs.6

EM countries have significantly lower Sovereign Debt than the US and other developed countries as a percentage of GDP.7

EM stocks are still 35% off their all-time highs and stocks have better fundamentals (e.g. lower P/E’s) than US and other developed market stocks.8

We believe that the emerging markets will benefit greatly over the next 20 years similar to the economic responses experienced in Europe, the US and Japan during their middle class surges. New capital should fl ow to these countries as economic benefi ts are realized from their younger populations trending upward in financial status. They’ll produce more and consume more than developed countries whose aging populations create strain on national pension systems and health care budgets.

2 ING Global Perspectives, December 12/31/13 3 Oppenheimer, Investment Viewpoints, 12/31/13

4 Ernst & Young, August 2013 5 TimesofMalta.com 10/24/13 6 T. Rowe Price, Insights, August 26, 2013 7 & 8 JP Morgan, Guide to the Markets 1Q2014

Investor Alert…Taxes on The Rise!New for 2013 are higher tax rates. For those in the highest brackets, expect an extra pinch from Uncle Sam on April 15th. A new maximum long-term capital gain and dividend tax rate of 20%, a reinstated 39.6% tax rate on taxable income and short-term capital gains, and a new Medicare tax rate of 3.8% bring new meaning to the adage that “it’s not what you make it’s what you keep that matters.” Clearly, a well-coordinated portfolio management approach that is sensitive to taxes has become more vital to protect and grow one’s wealth. That is why portfolio tax-management has been, and continues to be, a priority for us. Here are some of the things it entails:

Tax-Smart portfolio construction – We put tax-sensitive mutual funds, managers and asset classes in taxable accounts and keep the high turnover investments in the retirement accounts.

Year-round tax loss harvesting – Even big years in the market like 2013 have plenty of market dips where losses could be generated. We can book losses anytime of year to help with potential capital gains. Unused tax losses can be saved (carried forward) for future tax years.

Control for wash-sales – Booking tax losses is great, but you need to be careful. The IRS doesn’t allow you to buy the same security 30 days before or 30 days after you sold it in any account in a family’s household, including retirement accounts! If you do, the losses are not allowed for that tax year. Our state-of-the-art portfolio management software monitors wash-sales amongst all the accounts in a household to minimize this.

Proactive Tax-Planning – We communicate with clients and their tax professionals regularly during the year to make sure portfolio activity like realized gains and losses, retirement contributions, required minimum distributions, gifts of appreciated stock, and charitable contributions, are factored into your tax picture.

As a reminder, the better informed we are, the better we can do our job to help manage your wealth. For our clients, please have your tax professional forward a copy of your 2013 tax return to our office (or email our CPA liaison and VP of Compliance, Mallory Mangrum at mallory@meggreen.com) so we can make informed decisions and recommendations for your portfolio.

IRD… three little letters than can save you or your heirs a ton of taxes.

They stand for “Income in Receipt of a Decedent,” and it’s given to all types of taxable income earned, but not received by the decedent at the time of their passing. What do we mean? IRAs, pensions or 401k’s, income in annuities, unpaid interest or dividends, salary, wages and sales commissions not yet paid, but owed... things that would have been taxable to him or her had they lived.

IRD income is generally taxed at the benefi ciary’s ordinary income tax rate, so that IRA Rollover that Uncle Henry left you will be taxable at your rate upon withdrawal, no matter when.

UNLESS… Uncle Henry’s estate paid an estate tax on these IRD assets. In that case, you may be eligible for an IRD tax deduction based on the amount of estate taxes Uncle Henry’s estate paid. That could be a free and easy tax shelter. All you have to do is know about it and fi le accordingly.

Your CPA knows this, but with heirs, sometimes the whole picture doesn’t come through with the inheritance. Just wanted to make you aware.

4) TREND: Improving State and Local Finances – While 2013 saw its share of disappointments with Detroit at the top of the list, municipal finances continued to strengthen and the future is looking better. State’s finances have improved 15 consecutive quar ters and local government revenue is responding favorably to the improving US housing market and higher sales tax revenue.9

OPPORTUNITY: Municipal Bonds and High Yield Municipal Bonds – Municipal defaults are still low and those in recent years were not totally unexpected by por tfolio managers doing their job. The perception many investors have is that municipal bonds are “bad” right now because of default risk and interest rate risk. The reality is that municipal bonds are attractive for several reasons:

Excessive outflows in 2013 have created appealing credit spreads compared to other types of taxable fi xed income, especially for high yield municipal bonds.

State and Local governments have improved their budgets with fiscal austerity measures that are beginning to hit the bottom line.

Higher interest rates help by improving their pension funding status bringing much needed balance sheet relief.

Higher Federal income tax rates at 39.6%, phased-out itemized deductions and exemptions, and increasing State income tax rates make municipal bonds very attractive to wealthy investors.

Municipal bond income is not subject to the new 3.8% Medicare Tax.

They provide a predictable stream of high quality, dependable, tax-free income that is backed by state, and local governments that have historical default rates considerably lower than corporate bonds of similar quality.

It’s impor tant to be aware that plenty of challenges lay ahead in 2014 and headlines will once again test your intestinal for titude for risk as they try coaxing you to the sidelines for a “breather.” So be forewarned. While none of these events can be confidently predicted or anticipated, por tfolios can be structured to “weather” their deleterious effects. A well-balanced por tfolio of stocks, bonds, real estate, liquid alternatives and cash can go a long ways toward “Washington-proofing” your por tfolio or to protect against an occasional black swan.

For our clients, we look forward to reviewing your por tfolio and your allocations, as always, to make sure you are on the right track and positioned to take advantage of the next mega-trend. In the meantime, do not hesitate to contact us if you have any questions or concerns about the markets and/or upcoming events.

9 WSJ, In the Markets, 12/26/13